Exhibit 10.2

AMENDED AND RESTATED
ADVISORY MANAGEMENT AGREEMENT

This AMENDED AND RESTATED ADVISORY MANAGEMENT AGREEMENT (this “Agreement”) is
entered into on this the 29th day of December 2006, by and between BEHRINGER
HARVARD OPPORTUNITY REIT I, INC., a Maryland corporation (the “Company”), and
BEHRINGER HARVARD OPPORTUNITY ADVISORS I LP, a Texas limited partnership (the
“Advisor”).

W I T N E S S E T H

WHEREAS, the Company has issued and will continue to be issuing shares of its
common stock, par value $0.0001, to the public, such shares to be registered
with the Securities and Exchange Commission and may subsequently issue
additional securities;

WHEREAS, the Company and the Advisor previously entered into that certain
Advisory Agreement, dated September 20, 2005 (as amended, supplemented or
restated from time to time, the “Original Advisory Agreement”), and it is
intended that this Agreement amend and restate the Original Advisory Agreement
effective as of and for all periods after the date hereof;

WHEREAS, the Company is qualified as a real estate investment trust and intends
to invest its funds in investments permitted by the terms of the Company’s
Articles of Incorporation and Sections 856 through 860 of the Internal Revenue
Code;

WHEREAS, the Company desires to continue to avail itself of the experience,
sources of information, advice, assistance and certain facilities available to
the Advisor and to have the Advisor continue to undertake the duties and
responsibilities hereinafter set forth, on behalf of, and subject to the
supervision of, the Board, all as provided herein; and

WHEREAS, the Advisor is willing to continue to undertake to render such
services, subject to the supervision of the Board, on the terms and conditions
hereinafter set forth.

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants
and agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:

ARTICLE ONE

DEFINITIONS

The following defined terms used in this Agreement shall have the meanings
specified below:

Acquisition Expenses.  Any and all expenses incurred by the Company, the
Advisor, or any Affiliate of either in connection with the selection,
acquisition or development of any Asset, whether or not acquired, including,
without limitation, legal fees and expenses, travel and communications expenses,
costs of appraisals, nonrefundable option payments on property not acquired,
accounting fees and expenses, and title insurance premiums.  Acquisition
Expenses paid or incurred by the Advisor or any Affiliate are on behalf of the
Company and will be reimbursed by the Company in accordance with the terms of
Section 3.02(a)(ii).

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Acquisition Fees.  Any and all fees and commissions, exclusive of Acquisition
Expenses but including the Acquisition and Advisory Fees, paid by any Person to
any other Person (including any fees or commissions paid by or to any Affiliate
of the Company or the Advisor) in connection with making or investing in
Mortgages or the purchase, development or construction of an Asset, including,
without limitation, real estate commissions, selection fees, Development Fees,
Construction Fees, non-recurring management fees, loan fees, points or any other
fees of a similar nature.  Excluded shall be Development Fees and Construction
Fees paid to any Person not affiliated with the Sponsor in connection with the
actual development and construction of any Property.

Acquisition and Advisory Fees.  The fees payable to the Advisor pursuant to
Section 3.01(b).

Advisor.  Behringer Harvard Opportunity Advisors I LP, a Texas limited
partnership, any successor advisor to the Company, or any Person to which
Behringer Harvard Opportunity Advisors I LP or any successor advisor
subcontracts all or substantially all of its functions.

Affiliate or Affiliated.  As to any Person, (i) any Person directly or
indirectly owning, controlling, or holding, with the power to vote, 10% or more
of the outstanding voting securities of such other Person; (ii) any Person 10%
or more of whose outstanding voting securities are directly or indirectly owned,
controlled, or held, with power to vote, by such other Person; (iii) any Person,
directly or indirectly, controlling, controlled by, or under common control with
such other Person; (iv) any executive officer, director, trustee or general
partner of such other Person; and (v) any legal entity for which such Person
acts as an executive officer, director, trustee or general partner.

Aggregate Assets Value.  The aggregate book value of the Assets at the time of
measurement before deducting depreciation, bad debts or other similar non-cash
reserves and without reduction for any debt secured by or relating to such
assets; provided, however, that during such periods in which the Company is
obtaining regular independent valuations of the current value of its net assets
for purposes of enabling fiduciaries of employee benefit plan stockholders to
comply with applicable Department of Labor reporting requirements, “Aggregate
Assets Value” will equal the greater of (i) the amount determined pursuant to
the foregoing or (ii) the Assets’ aggregate valuation established by the most
recent such valuation report without reduction for depreciation, bad debts or
other non-cash reserves and without reduction for any debt secured by or
relating to such assets.

Appraised Value.  Value according to an appraisal made by an Independent
Appraiser.

Articles of Incorporation.  The Articles of Incorporation of the Company filed
with the Maryland State Department of Assessments and Taxation in accordance
with the Maryland General Corporation Law, as amended from time to time.

Assets.  Properties, Mortgages and other direct or indirect investments in
equity interests in or loans secured by or otherwise relating to Real Property
(other than investments in bank accounts, money market funds or other current
assets, whether of the proceeds from an Offering or the sale of an Asset or
otherwise) owned by the Company, directly or indirectly through one or more of
its Affiliates or Joint Ventures.

Asset Management Fee.  The fee payable to the Advisor for day-to-day
professional management services in connection with the Company and its
investments in Assets pursuant to this Agreement.

Average Invested Assets.  For a specified period, the average of the aggregate
book value of the Assets before deduction for depreciation, bad debts or other
non-cash reserves, computed by taking the

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average of such values at the end of each month during such period; provided,
however, that during such periods in which the Company is obtaining regular
independent valuations of the current value of its net assets for purposes of
enabling fiduciaries of employee benefit plan stockholders to comply with
applicable Department of Labor reporting requirements, “Average Invested Assets”
will equal the greater of (i) the amount determined pursuant to the foregoing or
(ii) the Assets’ aggregate valuation established by the most recent such
valuation report(s) without reduction for depreciation, bad debts or other
non-cash reserves.

Board.  The Board of Directors of the Company.

Bylaws.  The bylaws of the Company, as the same are in effect from time to time.

Change of Control.  Any event (including, without limitation, issue, transfer or
other disposition of Shares of capital stock of the Company or equity interests
in the Partnership, merger, share exchange or consolidation) after which any
“person” (as that term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended) is or becomes the “beneficial owner” (as
defined in Rule 13d-j of the Securities Exchange Act of 1934, as amended),
directly or indirectly, of securities of the Company or the Partnership
representing greater than 50% or more of the combined voting power of the
Company’s or the Partnership’s then outstanding securities, respectively;
provided, that, a Change of Control shall not be deemed to occur as a result of
any widely distributed public offering of the Shares.

Closing Price.  On any date, the last sale price for any class or series of the
Company’s Shares, regular way, or, in case no such sale takes place on such day,
the average of the closing bid and asked prices, regular way, for such Shares,
in either case as reported in the principal consolidated transaction reporting
system with respect to Shares listed or admitted to trading on the NYSE or, if
such Shares are not listed or admitted to trading on the NYSE, as reported on
the principal consolidated transaction reporting system with respect to Shares
listed on the principal national securities exchange on which such Shares are
listed or admitted to trading or, if such Shares are not listed or admitted to
trading on any national securities exchange, the last quoted price on the Nasdaq
National Market System, or, if not so quoted, the average of the high bid and
low asked prices in the over-the-counter market, as reported by the principal
automated quotation system or other quotation service that may then be in use
or, if such Shares are not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market maker making
a market in such Shares selected by the Board.

Code.  Internal Revenue Code of 1986, as amended from time to time, or any
successor statute thereto. Reference to any provision of the Code shall mean
such provision as in effect from time to time, as the same may be amended, and
any successor provision thereto, as interpreted by any applicable regulations as
in effect from time to time.

Company.  Behringer Harvard Opportunity REIT I, Inc., a corporation organized
under the laws of the State of Maryland.

Company Value.  The actual value of the Company as a going concern based on the
difference between (a) the actual value of all of its assets as determined in
good faith by the Board, including a majority of the Independent Directors, and
(b) all of its liabilities as set forth on its then current balance sheet,
provided that (i) if such Company Value is being determined in connection with a
Change of Control that establishes the Company’s net worth (e.g., a tender offer
for the Shares, sale of all of the Shares or a merger) then the Company Value
shall be the net worth established thereby and (ii) if such Company Value is
being determined in connection with a Listing, then the Company Value shall be
equal to the number of outstanding Shares multiplied by the Closing Price of a
single Common Share averaged over a period of 30 trading days during which the
Shares are listed or quoted for trading after the date of

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Listing.  For purposes hereof, a “trading day” shall be any day on which the
NYSE is open for trading whether or not the Shares are then Listed on the NYSE
and whether or not there is an actual trade of such Shares on any such day.  If
the holder of Convertible Shares disagree as to the Company Value as determined
by the Board, then each of the holder of Convertible Shares and the Company
(determined by a majority of the Independent Directors) shall name one appraiser
and the two named appraisers shall promptly agree in good faith to the
appointment of one other appraiser whose determination of the Company Value
shall be final and binding on the parties as to the Company Value.  The cost of
such appraisal shall be split evenly between the Company and the Advisor.

Competitive Real Estate Commission.  A real estate or brokerage commission paid
or, if no such commission is paid, the amount that customarily would be paid for
the purchase or sale of a Property that is reasonable, customary, and
competitive in light of the size, type and location of the Property (as
determined by the Board, including a majority of the Independent Directors).

Construction Fee.  A fee or other remuneration for acting as general contractor
and/or construction manager to construct improvements, supervise and coordinate
projects or to provide major repairs or rehabilitations on a Property.

Contract Purchase Price.  The amount actually paid or allocated in respect of
the purchase, development, construction or improvement of a Property, the amount
of funds advanced with respect to a Mortgage or the amount actually paid or
allocated in respect to the purchase of other Assets, in each case exclusive of
Acquisition Fees and Acquisition Expenses.

Contract Sales Price.  The total consideration provided for in the sales
contract for the sale of a Property.

Convertible Shares.  The 1,000 shares of the Company’s non-participating,
non-voting, convertible stock, par value $.0001 per share.

Dealer Manager.  Behringer Securities LP, an Affiliate of the Advisor, or such
Person selected by the Board to act as the dealer manager for an Offering.

Development Fee.  A fee for the packaging of a Property or Mortgage, including
the negotiation and approval of plans, and any assistance in obtaining zoning
and necessary variances and financing for a specific Property, either initially
or at a later date.  The Development Fee will include the reimbursement of the
specified cost incurred by the Advisor of engaging third parties to assist in
providing such services.

Director.  A member of the Board.

Distributions.  Any dividends or other distributions of money or other property
by the Company to owners of Shares, including distributions that may constitute
a return of capital for federal income tax purposes.

Gross Proceeds.  The aggregate purchase price of all Shares sold for the account
of the Company through an Offering, without deduction for Selling Commissions,
volume discounts, any marketing support and due diligence expense reimbursement
or Organization and Offering Expenses.  For the purpose of computing Gross
Proceeds, the purchase price of any Share for which reduced Selling Commissions
are paid to the Dealer Manager or a Soliciting Dealer (where net proceeds to the
Company are not reduced) shall be deemed to be the full amount of the Offering
price per Share pursuant to the Prospectus for such Offering without reduction.

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Independent Appraiser.  A Person with no material current or prior business or
personal relationship with the Advisor or the Directors and who is a qualified
appraiser of Real Property of the type held by the Company or of other Assets as
determined by the Board.  Membership in a nationally recognized appraisal
society such as the Appraisal Institute shall be conclusive evidence of such
qualification as to Real Property.

Independent Director.  A Director who is not on the date of determination, and
within the last two years from the date of determination has not been, directly
or indirectly associated with the Sponsor, the Company, the Advisor or any of
their Affiliates by virtue of (i) ownership of an interest in the Sponsor, the
Advisor or any of their Affiliates, other than the Company, (ii) employment by
the Sponsor, the Company, the Advisor or any of their Affiliates, (iii) service
as an officer or director of the Sponsor, the Advisor or any of their
Affiliates, other than as a Director of the Company, (iv) performance of
services, other than as a Director of the Company, (v) service as a director or
trustee of more than three real estate investment trusts organized by the
Sponsor or advised by the Advisor, or (vi) maintenance of a material business or
professional relationship with the Sponsor, the Advisor or any of their
Affiliates.  A business or professional relationship is considered material if
the aggregate gross revenue derived by the Director from the Sponsor, the
Advisor and their Affiliates exceeds 5% of either the Director’s annual gross
income during either of the last two years or the Director’s net worth on a fair
market value basis.  An indirect association with the Sponsor or the Advisor
shall include circumstances in which a Director’s spouse, parent, child,
sibling, mother- or father-in-law, son- or daughter-in-law, or brother- or
sister-in-law is or has been associated with the Sponsor, the Advisor, any of
their Affiliates, or the Company.

Intellectual Property Rights.  All rights, titles and interests, whether foreign
or domestic, in and to any and all trade secrets, confidential information
rights, patents, invention rights, copyrights, service marks, trademarks,
know-how, or similar intellectual property rights and all applications and
rights to apply for such rights, as well as any and all moral rights, rights of
privacy, publicity and similar rights and license rights of any type under the
laws or regulations of any governmental, regulatory, or judicial authority,
foreign or domestic and all renewals and extensions thereof.

Invested Capital.  The amount calculated by multiplying the total number of
Shares purchased by Stockholders by the issue price, reduced by the portion of
any Distribution (other than any Stock Dividends) that is attributable to Net
Sales Proceeds and by any amounts paid by the Company to repurchase Shares
pursuant to the Company’s plan for repurchase of Shares.

Joint Ventures.  The joint venture or partnership arrangements in which the
Company or the Partnership is a co-venturer or general partner, which are
established to acquire or hold Assets.

Listing or Listed.  The listing of the Shares of the Company on a national
securities exchange or the quotation of shares on the Nasdaq National Market
System.  Upon such Listing, the Shares shall be deemed Listed.

Mortgages.  In connection with mortgage financing provided, invested in or
purchased by the Company, all of the notes, deeds of trust, security interests
or other evidences of indebtedness or obligations, which are secured or
collateralized by Real Property owned by the borrowers under such notes, deeds
of trust, security interests or other evidences of indebtedness or obligations.

NASAA Guidelines.  The Statement of Policy Regarding Real Estate Investment
Trusts of the North American Securities Administrators Association, Inc.
effective September 29, 1993.

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Net Income.  For any period, the Company’s total revenues applicable to such
period, less the total expenses applicable to such period other than additions
to reserves for depreciation, bad debts or other similar non-cash reserves and
excluding any gain from the sale of the Assets.

Net Sales Proceeds.  In the case of a transaction described in clause (i)(A) of
the definition of Sale, the proceeds of any such transaction less the amount of
selling expenses incurred by or on behalf of the Company, including all real
estate commissions, closing costs and legal fees and expenses. In the case of a
transaction described in clause (i)(B) of such definition, Net Sales Proceeds
means the proceeds of any such transaction less the amount of selling expenses
incurred by or on behalf of the Company, including any legal fees and expenses
and other selling expenses incurred in connection with such transaction. In the
case of a transaction described in clause (i)(C) of such definition, Net Sales
Proceeds means the proceeds of any such transaction actually distributed to the
Company from the Joint Venture less the amount of any selling expenses,
including legal fees and expenses incurred by or on behalf of the Company (other
than those paid by the Joint Venture).  In the case of a transaction or series
of transactions described in clause (i)(D) of the definition of Sale, Net Sales
Proceeds means the proceeds of any such transaction (including the aggregate of
all payments under a Mortgage or in satisfaction thereof other than regularly
scheduled interest payments to the extent such interest accrues at a rate of
less than ten percent (10%) per annum) less the amount of selling expenses
incurred by or on behalf of the Company, including all commissions closing costs
and legal fees and expenses.  In the case of a transaction described in clause
(i)(E) of such definition, Net Sales Proceeds means the proceeds of any such
transaction less the amount of selling expenses incurred by or on behalf of the
Company, including any legal fees and expenses and other selling expenses
incurred in connection with such transaction. In the case of a transaction
described in clause (ii) of the definition of Sale, Net Sales Proceeds means the
proceeds of such transaction or series of transactions less all amounts
generated thereby which are reinvested in one or more Assets within 180 days
thereafter and less the amount of any real estate commissions, closing costs,
and legal fees and expenses and other selling expenses incurred by or allocated
to the Company in connection with such transaction or series of transactions. 
Net Sales Proceeds shall also include any consideration (including non-cash
consideration such as stock, notes, or other property or securities) that the
Company determines, in its discretion, to be economically equivalent to proceeds
of a Sale, valued in the reasonable determination of the Company. Net Sales
Proceeds shall not include any reserves established by the Company in its sole
discretion.

NYSE.  The New York Stock Exchange, Inc.

Offering.  Any private or public offering of Shares pursuant to an effective
registration statement filed under the Securities Act or exempt from such filing
during periods from and after the date hereof.

Organization and Offering Expenses.  Specified as any and all costs and
expenses, other than Selling Commissions and the dealer manager fee (as in
effect from time to time), incurred by and to be paid by the Company, the
Advisor or any Affiliate in connection with the formation, qualification and
registration of the Company and the marketing and distribution of its Shares,
including, without limitation, the following: legal, accounting and escrow fees;
printing, amending, supplementing, mailing and distributing costs; filing,
registration and qualification fees and taxes; telecopier and telephone costs;
and all advertising and marketing expenses, including the costs related to
investor and broker-dealer sales meetings.  Organization and Offering Expenses
paid or incurred by the Advisor or any Affiliate are on behalf of the Company
and will be reimbursed by the Company in accordance with the terms of Section
3.02(a)(i).

Partnership.  Behringer Harvard Opportunity OP I, LP, a Texas limited
partnership, through which the Company may own Assets.

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Performance Fee.  The fee payable to the Advisor upon termination of this
Agreement under certain circumstances if certain performance standards have been
met pursuant to Section 4.03(b).

Person.  An individual, corporation, association, business trust, estate, trust,
partnership, limited liability company or other legal entity.

Property or Properties.  As the context requires, any, or all, respectively, of
the Real Property acquired by the Company, either directly or indirectly
(whether through joint venture arrangements or other partnership or investment
interests).

Proprietary Property.  All modeling algorithms, tools, computer programs,
know-how, methodologies, processes, technologies, ideas, concepts, skills,
routines, subroutines, operating instructions and other materials and aides used
in performing the duties set forth in Section 2.02 that relate to investment
advice regarding current and potential Assets, and all modifications,
enhancements and derivative works of the foregoing.

Prospectus.  Prospectus has the meaning set forth in Section 2(10) of the
Securities Act, including a preliminary prospectus, an offering circular as
described in Rule 256 of the General Rules and Regulations under the Securities
Act or, in the case of an intrastate offering, any document by whatever name
known, utilized for the purpose of offering and selling securities of the
Company to the public.

Real Property.  Land, rights in land (including leasehold interests), and any
buildings, structures, improvements, furnishings, fixtures and equipment located
on or used in connection with land and rights or interests in land.

REIT.  A corporation, trust, association or other legal entity (other than a
real estate syndication) that is engaged primarily in investing in equity
interests in real estate (including fee ownership and leasehold interests) or in
loans secured by real estate or both in accordance with Sections 856 through 860
of the Code.

Sale or Sales.  (i) Any transaction or series of transactions whereby: (A) the
Company or the Partnership directly or indirectly (except as described in other
subsections of this definition) sells, grants, transfers, conveys, or
relinquishes its ownership of any Property or portion thereof, including the
lease of any Property consisting of a building only, and including any event
with respect to any Property which gives rise to a significant amount of
insurance proceeds or condemnation awards; (B) the Company or the Partnership
directly or indirectly (except as described in other subsections of this
definition) sells, grants, transfers, conveys, or relinquishes its ownership of
all or substantially all of the interest of the Company or the Partnership in
any Joint Venture in which it is a co-venturer or partner; (C) any Joint Venture
directly or indirectly (except as described in other subsections of this
definition) in which the Company or the Partnership as a co-venturer or partner
sells, grants, transfers, conveys, or relinquishes its ownership of any Property
or portion thereof, including any event with respect to any Property which gives
rise to insurance claims or condemnation awards; (D) the Company or the
Partnership directly or indirectly (except as described in other subsections of
this definition) sells, grants, conveys or relinquishes its interest in any
Mortgage or portion thereof (including with respect to any Mortgage, all
repayments thereunder or in satisfaction thereof other than regularly scheduled
interest payments) and any event with respect to a Mortgage which gives rise to
a significant amount of insurance proceeds or similar awards; or (E) the Company
or the Partnership directly or indirectly (except as described in other
subsections of this definition) sells, grants, transfers, conveys, or
relinquishes its ownership of any other Asset not previously described in this
definition or any portion thereof, but (ii) not including any transaction or
series of transactions specified in clause (i) (A) through (E) above in which
the proceeds of such transaction or series of transactions are reinvested in one
or more Assets within 180 days thereafter.

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Securities Act.  The Securities Act of 1933, as amended from time to time, or
any successor statute thereto.  Reference to any provision of the Securities Act
shall mean such provision as in effect from time to time, as the same may be
amended, and any successor provision thereto, as interpreted by any applicable
regulations as in effect from time to time.

Selling Commissions.  Any and all commissions payable to underwriters, dealer
managers or other broker-dealers in connection with the sale of Shares,
including, without limitation, commissions payable to Behringer Securities LP.

Shares.  Any shares of the Company’s common stock, par value $.0001 per share.

Soliciting Dealers.  Broker-dealers who are members of the National Association
of Securities Dealers, Inc., or that are exempt from broker-dealer registration,
and who, in either case, have executed participating broker or other agreements
with the Dealer Manager to sell Shares.

Sponsor.  Robert M. Behringer.

Stock Dividend.  Any dividend or other distribution paid to stockholders of the
Company in the form of additional Shares.

Stockholders.  The record holders of the Company’s Shares as maintained in the
books and records of the Company or its transfer agent.

Stockholders’ 10% Return.  As of any date, an aggregate amount equal to a 10%
cumulative, noncompounded, annual return on Invested Capital (calculated like
simple interest); provided, however, that for purposes of calculating the
Stockholders’ 10% Return, any Stock Dividend shall not be included as a
Distribution; and provided further that for purposes of determining the
Stockholders’ 10% Return, the return for each portion of the Invested Capital
shall commence for purposes of the calculation upon the issuance of the shares
issued in connection with such capital.

Subordinated Disposition Fee.  The fee payable to the Advisor for services
provided in connection with the Sale of one or more Properties pursuant to
Section 3.01(c).

Subordinated Incentive Listing Fee.  The fee payable to the Advisor under
certain circumstances if the Shares are Listed pursuant to Section 3.01(e).

Subordinated Share of Net Sales Proceeds.  The fee payable to the Advisor under
certain circumstances following receipt of Net Sales Proceeds pursuant to
Section 3.01(d).

Termination Date.  The date of termination of this Agreement.

Texas Tax Code.  The Texas Tax Code as amended by Texas H.B. 3, 79th Leg., 3rd
C.S. (2006).  Reference to any provision of the Texas Tax Code Act shall mean
such provision as in effect from time to time, as the same may be amended, and
any successor provision thereto, as interpreted by any applicable administrative
rules as in effect from time to time.

Total Operating Expenses.  All costs and expenses paid or incurred by the
Company, as determined under generally accepted accounting principles, which are
in any way related to the operation of the Company or to Company business,
including the Asset Management Fee, but excluding (i) the expenses of raising
capital such as Organization and Offering Expenses, legal, audit, accounting,

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underwriting, brokerage, listing, registration, and other fees, printing and
other such expenses and tax incurred in connection with the issuance,
distribution, transfer, registration and Listing of the Shares, (ii) interest
payments, (iii) taxes, (iv) non-cash expenditures such as depreciation,
amortization and bad debt reserves, (v) the Subordinated Share of Net Sales
Proceeds, (vi) the Performance Fee, (vii) the Subordinated Incentive Listing
Fee, (viii) Acquisition Fees and Acquisition Expenses, (ix) real estate
commissions on the Sale of Property, and (x) other fees and expenses connected
with the acquisition, disposition, management and ownership of real estate
interests, mortgage loans or other property (including the costs of foreclosure,
insurance premiums, legal services, maintenance, repair and improvement of
property).

2%/25% Guidelines.  The requirement pursuant to the NASAA Guidelines that, in
any 12 month period, Total Operating Expenses not exceed the greater of 2% of
Average Invested Assets during such 12 month period or 25% of Net Income over
the same 12 month period.

ARTICLE II

THE ADVISOR

2.01        Appointment.  The Company hereby appoints the Advisor to serve as
its advisor on the terms and conditions set forth in this Agreement, and the
Advisor hereby accepts such appointment.

2.02        Duties of the Advisor.  The Advisor shall be deemed to be in a
fiduciary relationship to the Company and its Stockholders.  The Advisor
undertakes to use its best efforts to present to the Company potential
investment opportunities and to provide a continuing and suitable investment
program consistent with the investment objectives and policies of the Company as
determined and adopted from time to time by the Board.  In performance of this
undertaking, subject to the supervision of the Board and consistent with the
provisions of the Company’s most recent Prospectus for Shares, the Articles of
Incorporation and Bylaws, the Advisor shall, either directly or by engaging an
Affiliate of the Advisor or other Person:

(a)           serve as the Company’s investment and financial advisor and
provide research and economic and statistical data in connection with the Assets
and investment policies;

(b)           provide the daily management of the Company and perform and
supervise the various administrative functions reasonably necessary for the
management and operations of the Company;

(c)           maintain and preserve the books and records of the Company,
including stock books and records reflecting a record of the Stockholders and
their ownership of the Company’s uncertificated Shares, if any, and acting as
transfer agent for the Company’s Shares;

(d)           investigate, select, and, on behalf of the Company, engage and
conduct business with such Persons as the Advisor deems necessary to the proper
performance of its obligations hereunder, including but not limited to
consultants, accountants, correspondents, lenders, technical advisors,
attorneys, brokers, underwriters, corporate fiduciaries, escrow agents,
depositaries, custodians, agents for collection, insurers, insurance agents,
banks, builders, developers, property owners, mortgagors, property management
companies, transfer agents and any and all agents for any of the foregoing,
including Affiliates of the Advisor, and Persons acting in any other capacity
deemed by the Advisor necessary or desirable for the performance of any of the
foregoing services, including but not limited to entering into contracts in the
name of the Company with any of the foregoing;

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(e)           consult with the officers and the Board and assist the Board in
the formulation and implementation of the Company’s financial policies, and, as
necessary, furnish the Board with advice and recommendations with respect to the
making of investments consistent with the investment objectives and policies of
the Company and in connection with any borrowings proposed to be undertaken by
the Company;

(f)            subject to the provisions of Sections 2.02(h) and 2.03 hereof,
(i) locate, analyze and select potential investments in Assets, (ii) structure
and negotiate the terms and conditions of transactions pursuant to which
investment in Assets will be made; (iii) make investments in Assets on behalf of
the Company or the Partnership in compliance with the investment objectives and
policies of the Company; (iv) arrange for financing and refinancing and make
other changes in the asset or capital structure of, and dispose of, reinvest the
proceeds from the sale of, or otherwise deal with the investments in, Assets;
and (v) enter into leases of Property and service contracts for Assets and, to
the extent necessary, perform all other operational functions for the
maintenance and administration of such Assets, including the servicing of
Mortgages;

(g)           provide the Board with periodic reports regarding prospective
investments in Assets;

(h)           obtain the prior approval of the Board (including a majority of
all Independent Directors) for any and all investments in Assets;

(i)            negotiate on behalf of the Company with banks or lenders for
loans to be made to the Company, negotiate on behalf of the Company with
investment banking firms and broker-dealers, and negotiate private sales of
Shares and other securities of the Company or obtain loans for the Company, as
and when appropriate, but in no event in such a way so that the Advisor shall be
acting as broker-dealer or underwriter; and provided, further, that any fees and
costs payable to third parties incurred by the Advisor in connection with the
foregoing shall be the responsibility of the Company;

(j)            obtain reports (which may be prepared by or for the Advisor or
its Affiliates), where appropriate, concerning the value of investments or
contemplated investments of the Company in Assets;

(k)           from time to time, or at any time reasonably requested by the
Board, make reports to the Board of its performance of services to the Company
under this Agreement;

(l)            provide the Company with all necessary cash management services;

(m)          deliver to or maintain on behalf of the Company copies of all
appraisals obtained in connection with the investments in Assets;

(n)           upon request of the Company, act, or obtain the services of others
to act, as attorney-in-fact or agent of the Company in making, requiring and
disposing of Assets, disbursing, and collecting the funds, paying the debts and
fulfilling the obligations of the Company and handling, prosecuting and settling
any claims of the Company, including foreclosing and otherwise enforcing
mortgage and other liens and security interests comprising any of the Assets;

 

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(o)           supervise the preparation and filing and distribution of returns
and reports to governmental agencies and to Stockholders and other investors and
act on behalf of the Company in connection with investor relations;

(p)           provide office space, equipment and personnel as required for the
performance of the foregoing services as Advisor;

(q)           prepare on behalf of the Company all reports and returns required
by the Securities and Exchange Commission, Internal Revenue Service and other
state or federal governmental agencies; and

(r)            do all things necessary to assure its ability to render the
services described in this Agreement.

2.03        Authority of Advisor.

(a)           Pursuant to the terms of this Agreement (including the
restrictions included in this Section 2.03 and in Section 2.06), and subject to
the continuing and exclusive authority of the Board over the management of the
Company, the Board hereby delegates to the Advisor the authority to (i) locate,
analyze and select investment opportunities, (ii) structure the terms and
conditions of transactions pursuant to which investments will be made or
acquired for the Company or the Partnership, (iii) acquire Properties, make and
acquire Mortgages and invest in other Assets in compliance with the investment
objectives and policies of the Company, (iv) arrange for financing or
refinancing of Assets, (v) enter into leases for the Properties and service
contracts for the Assets, including oversight of Affiliated companies that
perform property management or other services for the Company, (vi) oversee
non-affiliated and Affiliated property managers and other non-affiliated and
Affiliated Persons who perform services for the Company, and (vii) undertake
accounting and other record-keeping functions at the Asset level.

(b)           Notwithstanding the foregoing, any investment in Assets by the
Company or the Partnership (as well as any financing acquired by the Company or
the Partnership in connection with such investment), will require the prior
approval of the Board (including a majority of the Independent Directors).

(c)           The prior approval of a majority of the Independent Directors and
a majority of the Board not otherwise interested in the transaction will be
required for each transaction with the Advisor or its Affiliates.

(d)           If a transaction requires approval by the Board, the Advisor will
deliver to the Directors all documents required by them to properly evaluate the
proposed transaction.

The Board may, at any time upon the giving of notice to the Advisor, modify or
revoke the authority set forth in this Section 2.03. If and to the extent the
Board so modifies or revokes the authority contained herein, the Advisor shall
henceforth submit to the Board for prior approval such proposed transactions
involving investments in Assets as thereafter require prior approval, provided
however, that such modification or revocation shall be effective upon receipt by
the Advisor and shall not be applicable to investment transactions to which the
Advisor has committed the Company prior to the date of receipt by the Advisor of
such notification.

2.04        Bank Accounts.  The Advisor may establish and maintain one or more
bank accounts in its own name for the account of the Company or in the name of
the Company and may collect and deposit

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into any such account or accounts, and disburse from any such account or
accounts, any money on behalf of the Company, under such terms and conditions as
the Board may approve, provided that no funds shall be commingled with the funds
of the Advisor; and the Advisor shall from time to time render appropriate
accountings of such collections and payments to the Board, its Audit Committee
and the auditors of the Company.

2.05        Records; Access.  The Advisor shall maintain appropriate records of
all its activities hereunder and make such records available for inspection by
the Board and by counsel, auditors and authorized agents of the Company, at any
time or from time to time during normal business hours.  The Advisor shall at
all reasonable times have access to the books and records of the Company.

2.06        Limitations on Activities.  Anything else in this Agreement to the
contrary notwithstanding, the Advisor shall refrain from taking any action
which, in its sole judgment made in good faith, would (a) adversely affect the
status of the Company as a REIT, (b) subject the Company to regulation under the
Investment Company Act of 1940, as amended, or (c) violate any law, rule,
regulation or statement of policy of any governmental body or agency having
jurisdiction over the Company, the Shares or any of the Company’s securities, or
otherwise not be permitted by the Articles of Incorporation or Bylaws, except if
such action shall be ordered by the Board, in which case the Advisor shall
notify promptly the Board of the Advisor’s judgment of the potential impact of
such action and shall refrain from taking such action until it receives further
clarification or instructions from the Board.  In such event the Advisor shall
have no liability for acting in accordance with the specific instructions of the
Board so given.  The Advisor, its directors, officers, employees and
stockholders, and the directors, officers, employees and stockholders of the
Advisor’s Affiliates shall not be liable to the Company or to the Board or
Stockholders for any act or omission by the Advisor, its directors, officers,
employees or stockholders, or for any act or omission of any Affiliate of the
Advisor, its directors, officers or employees or stockholders except as provided
in Section 5.02 of this Agreement.

2.07        Relationship with Directors.  Directors, officers and employees of
the Advisor or an Affiliate of the Advisor may serve as Directors, officers or
employees of the Company, except that no director, officer or employee of the
Advisor or its Affiliates who also is a Director shall receive any compensation
from the Company for serving as a Director other than reasonable reimbursement
for travel and related expenses incurred in attending meetings of the Board.

2.08        Other Activities of the Advisor.  Nothing herein contained shall
prevent the Advisor or its Affiliates from engaging in other activities,
including, without limitation, the rendering of advice to other Persons
(including other REITs) and the management of other programs advised, sponsored
or organized by the Advisor or its Affiliates; nor shall this Agreement limit or
restrict the right of any director, officer, employee, or stockholder of the
Advisor or its Affiliates to engage in any other business or to render services
of any kind to any other Person.  The Advisor may, with respect to any
investment in which the Company is a participant, also render advice and service
to each and every other participant therein.  The Advisor shall report to the
Board the existence of any condition or circumstance, existing or anticipated,
of which it has knowledge, which creates or could create a conflict of interest
between the Advisor’s obligations to the Company and its obligations to or its
interest in any other Person.  The Advisor or its Affiliates shall promptly
disclose to the Board knowledge of such condition or circumstance.  If the
Sponsor, Advisor, Director or Affiliates thereof have sponsored other investment
programs with similar investment objectives which have investment funds
available at the same time as the Company, it shall be the duty of the Board
(including the Independent Directors) to adopt the method set forth in the
Company’s most recent Prospectus for its Shares or another reasonable method by
which investments are to be allocated to the competing investment entities and
to use their best efforts to apply such method fairly to the Company.

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ARTICLE III

COMPENSATION AND REIMBURSEMENT OF SPECIFIED COSTS

3.01        Fees.

(a)           Asset Management Fee.  The Company shall pay the Advisor a monthly
Asset Management Fee on the 15th day of each month in an amount equal to
1/12th of 0.75% of Aggregate Assets Value as of the last day of the preceding
month.

(b)           Acquisition and Advisory Fees.  The Company shall pay the Advisor
a fee in the amount of 2.5% of the Contract Purchase Price of each Asset as
Acquisition and Advisory Fees payable at the time and in respect of funds
expended for (i) the acquisition of an Asset, (ii) to the extent that such funds
are capitalized, for the development, construction or improvement of an Asset,
or (iii) the making of a Mortgage.  The total of all Acquisition Fees and any
Acquisition Expenses shall be limited in accordance with the Articles of
Incorporation.

(c)           Subordinated Disposition Fee.  If the Advisor or an Affiliate
provides a substantial amount of the services (as determined by a majority of
the Independent Directors) in connection with the Sale of one or more Assets,
the Advisor or such Affiliate shall receive, subject to the satisfaction of the
condition outlined below, a Subordinated Disposition Fee in an amount (the
“Contingent Subordinated Disposition Fee”) equal to (subject to the limitation
in the following paragraph) (i) in the case of the sale of Property, the lesser
of (A) one-half of a Competitive Real Estate Commission or (B) 3% of the sales
price of such Property and (ii) in the case of the sale of any Asset other than
Property, 3% of the sales price of such Asset or Assets.  The Contingent
Subordinated Disposition Fee will not be earned or paid unless and until the
Stockholders have received total Distributions in an amount equal to or in
excess of the sum of their aggregate Invested Capital plus the Stockholders’ 10%
Return.  To the extent that, in any instance, the Contingent Subordinated
Disposition Fees is not earned and paid due to the foregoing limitation, the
Contingent Subordinated Disposition Fees that would have been earned and paid
had the foregoing limitation not been in place at the time of a Sale shall be a
contingent liability of the Company, which shall be paid if and only if the
conditions set forth in this subparagraph 3.01(c) have been satisfied and, upon
the satisfaction of such condition, the Company shall pay all such Contingent
Subordination Disposition Fees as if such condition had been satisfied with
respect to each such prior Sale.

The Subordinated Disposition Fee may be payable in addition to real estate
commissions paid to non-Affiliates, provided, however, that the total real
estate commissions paid to all Persons by the Company (together with the
Subordinated Disposition Fee) shall in no case exceed an amount equal to the
lesser of (i) 6% of the Contract Sales Price of an Asset or (ii) the Competitive
Real Estate Commission in respect of any Property.

In the event this Agreement is terminated prior to such time as the Stockholders
have received total Distributions in an amount equal to or in excess of the sum
of their aggregate Invested Capital plus the Stockholders’ 10% Return through
the Termination Date, the Company Value shall be determined and any contingent
liabilities for the payment of Contingent Subordinated Disposition Fees on
Assets previously sold will be paid if the Company Value plus total
Distributions received prior to the Termination Date equals or exceeds the sum
of the aggregate Invested Capital plus the Stockholders’ 10% Return through the
Termination Date and then only to the extent of such excess.

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Following Listing, and as soon as practicable after determination of Market
Value (defined below), any contingent liabilities for the payment of the
Contingent Subordinated Disposition Fees on Assets previously sold will be
earned and paid if and only if the Stockholders have received or been deemed to
have received total Distributions in an amount equal to or in excess of the sum
of the aggregate Invested Capital plus the Stockholders’ 10% Return through the
date of Listing.  For purposes of the preceding sentence, in addition to actual
Distributions received, Stockholders will be deemed to have received
Distributions in the amount equal to the product of the total number of Shares
outstanding and the average closing price of the Shares over the 30-trading-day
period beginning the date of Listing (the “Market Value”).  Once any Contingent
Subordinated Disposition Fees are actually paid, such amounts shall thereafter
be referred to as “Subordinated Disposition Fees.”

(d)           Subordinated Share of Net Sales Proceeds.  Prior to Listing, upon
the consummation of any Sale, the Advisor shall receive a Subordinated Share of
Net Sales Proceeds in an amount equal to 15% of Net Sales Proceeds less the
amount by which the Company’s debt for borrowed money exceeds the aggregate book
value of the Company’s assets after the sale of the Asset(s) in respect of which
the Net Sales Proceeds is being determined. **Notwithstanding the foregoing, the
Subordinated Share of Net Sales Proceeds will not be earned or paid unless and
until the Stockholders have received total Distributions in an amount equal to
or in excess of the sum of their aggregate Invested Capital plus the
Stockholders’ 10% Return.  To the extent that, in any instance, the Subordinated
Share of Net Sales Proceeds is not earned and paid due to the foregoing
limitation, the Subordinated Share of Net Sales Proceeds that would have been
earned and paid had the foregoing limitation not been in place at the time of a
Sale shall be a contingent liability of the Company, which shall be paid if and
only if the conditions set forth in the preceding sentence of this subparagraph
3.01(d) have been satisfied and, upon the satisfaction of such condition, the
Company shall pay all such Subordinated Share of Net Sales Proceeds as if such
condition had been satisfied with respect to each such prior Sale.

Following Listing, and as soon as practicable after determination of Market
Value, if the Stockholders have received or been deemed to have received total
Distributions in an amount equal to the sum of their aggregate Invested Capital
and Stockholders’ 10% Return through the date of Listing, the Advisor shall
receive a Subordinated Share of Net Sales Proceeds in an amount equal to 15% of
Net Sales Proceeds less the amount by which the Company’s debt for borrowed
money exceeds the aggregate book value of the Company’s assets after the sale of
the Asset(s) in respect of which the Net Sales Proceeds is being determined. 
For purposes of this subparagraph (d), in determining whether the Subordinated
Share of Net Sales Proceeds is payable following Listing, in addition to actual
Distributions received, Stockholders will be deemed to have received
Distributions in the amount equal to the Market Value.

(e)           Subordinated Incentive Listing Fee.  Following Listing, and as
soon as practicable after determination of Market Value, the Advisor shall be
entitled to receive a Subordinated Incentive Listing Fee payable in the form of
an interest bearing promissory note (the “SILF Note”) in a principal amount
equal to 15% of the amount by which (i) the market value of the outstanding
Shares, measured by taking the Market Value, plus the total of all Distributions
paid to Stockholders from the Company’s inception until the date of Listing,
exceeds (ii) the sum of (A) 100% of Invested Capital and (B) the total
Distributions required to be paid to the Stockholders in order to pay the
Stockholders’ 10% Return from inception through the date of Listing.  Interest
on the SILF Note will accrue beginning on the date of Listing at a rate deemed
fair and reasonable by the Independent Directors on the date of Listing.  The
Company shall repay the SILF Note using the entire Net Sales Proceeds of each
Sale after Listing until the SILF Note is paid in full, with interest.  If the
SILF Note has not been paid in full within five

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years from the date of Listing, then the Advisor, its successors or assigns, may
elect to convert the balance of the SILF NOTE, including accrued but unpaid
interest, into Shares at a price per Share equal to the average Closing Price of
the Shares over the ten trading days immediately preceding the date of such
election.  If the Shares are no longer listed at such time as the SILF Note
becomes convertible into Shares as provided by this paragraph, then the price
per Share, for purposes of conversion, shall equal the fair market value for the
Shares as determined by the Board based upon the Appraised Value of the Assets
as of the date of election.  The principal amount of the SILF Note shall be
referred to as “Subordinated Disposition Fees.”

(f)            Debt Financing Fee.  In the event of the origination of any debt
financing obtained by or for the Company (including any refinancing of debt),
the Company will pay to the Advisor a debt financing fee equal to one percent
(1%) of the amount available under such financing.  The Debt Financing Fee
includes the reimbursement of the specified cost incurred by the Advisor of
engaging third parties to source debt financing, and nothing herein shall
prevent the Advisor from entering fee-splitting arrangements with third parties
with respect to the Debt Financing Fee.

(g)           Limitations on Payments.  Notwithstanding the foregoing, no
payments shall be made under Sections 3.01(d), 3.01(e) or 4.03(b) if, at or
prior to the time the payment is due, the Convertible Shares have been converted
into Shares in the case of Sections 3.01(d) and 3.01(e), or, in the case of
Section 4.03(b), the determination of the number of Shares issuable upon
conversion of the Convertible Shares has been made in accordance with Section
5.3(iii)(c) of Article V of the Articles of Incorporation, in each case, without
any reduction in the number of Convertible Shares converted or in the value or
number of Shares to be issued upon such conversion that may be triggered under
the terms of the Convertible Shares to avoid jeopardizing the Company’s REIT
status.  If, however, the Convertible Shares have been converted into Shares in
the case of Sections 3.01(d) and 3.01(e), or, in the case of Section 4.03(b),
the determination of the number of Shares issuable upon conversion of the
Convertible Shares has been made in accordance with Section 5.3(iii)(c) of
Article V of the Articles of Incorporation, in each case, with a reduction in
the number of Convertible Shares converted or in the value or number of Shares
issued upon such conversion triggered under the terms of the Convertible Shares
to avoid jeopardizing the Company’s REIT status, (i) no payments otherwise due
and payable under Section 3.01(d) (“Offset Payments”) shall be paid until the
aggregate amount of such Offset Payments equals the aggregate value of the
Shares (as determined at the time of such conversion as being the Company Value
divided by the number of Shares outstanding at such time) issued or issuable
upon conversion of the Convertible Shares, and (ii) any payments otherwise due
and payable under Sections 3.01(e) or 4.03(b) shall be reduced,
dollar-for-dollar, by an amount equal to the aggregate value of the Shares (as
determined at the time of such conversion as being the Company Value divided by
the number of Shares outstanding at such time) issued or issuable upon
conversion of the Convertible Shares.

3.02        Expenses.

(a)           In addition to the compensation paid to the Advisor pursuant to
Section 3.01 hereof, the Company shall pay directly or reimburse the Advisor for
the specified cost of all expenses paid or incurred by the Advisor in connection
with the services it provides to the Company pursuant to this Agreement,
including, but not limited to:

(i)            Organization and Offering Expenses; provided, however, that
within 60 days after the end of the month in which an Offering terminates, the
Advisor shall reimburse the Company for any Organization and Offering Expenses
reimbursement

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received by the Advisor pursuant to this Section 3.02, to the extent that such
reimbursement exceeds 2% of the Gross Proceeds exclusive of Gross Proceeds from
shares sold under the Company’s Distribution Reinvestment Plan.  The Advisor
shall be responsible for the payment of all Organization and Offering Expenses
in excess of 2% of the Gross Proceeds exclusive of Gross Proceeds from shares
sold under the Company’s Distribution Reinvestment Plan;

(ii)           Acquisition Expenses incurred in connection with the selection
and acquisition of Assets in an amount equal to up to 0.5% of the Contract
Purchase Price of each Asset;

(iii)          the actual cost of goods, services and materials used by the
Company and obtained from Persons not affiliated with the Advisor, other than
Acquisition Expenses, including brokerage fees paid in connection with the
purchase and sale of Shares or other securities;

(iv)          interest and other costs for borrowed money, including discounts,
points and other similar fees;

(v)           taxes and assessments on income or property and taxes as an
expense of doing business;

(vi)          costs associated with insurance required in connection with the
business of the Company or by the Board;

(vii)         expenses of managing and operating Assets owned by the Company,
whether payable to an Affiliate of the Company or a non-affiliated Person;

(viii)        all expenses in connection with payments to the Board for
attendance at meetings of the Board and Stockholders;

(ix)           expenses associated with Listing or with the issuance and
distribution of Shares and other securities of the Company, such as Selling
Commissions and fees, advertising expenses, taxes, legal and accounting fees,
Listing and registration fees, and other Organization and Offering Expenses;

(x)            expenses connected with payments of Distributions in cash or
otherwise made or caused to be made by the Company to the Stockholders;

(xi)           expenses of organizing, revising, amending, converting,
modifying, or terminating the Company or the Articles of Incorporation;

(xii)          expenses of any third party transfer agent for the Shares and of
maintaining communications with Stockholders, including the cost of preparation,
printing, and mailing annual reports and other Stockholder reports, proxy
statements and other reports required by governmental entities;

(xiii)         administrative service expenses (including personnel costs;
provided, however, that no reimbursement shall be made for costs of personnel to
the extent that such personnel perform services in transactions for which the
Advisor receives a separate fee); and

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(xiv)        audit, accounting and legal fees.

(b)           Expenses incurred by the Advisor on behalf of the Company and
payable pursuant to this Section 3.02 shall be reimbursed no less than quarterly
to the Advisor within 60 days after the end of each quarter.  The Advisor shall
prepare a statement documenting the expenses of the Company during each quarter,
and shall deliver such statement to the Company within 45 days after the end of
each quarter.

3.03        Other Services.  Should the Board request that the Advisor or any
director, officer or employee thereof render services for the Company other than
set forth in Section 2.02, such services shall be separately compensated at such
rates and in such amounts as are agreed by the Advisor and the Independent
Directors, subject to the limitations contained in the Articles of
Incorporation, and shall not be deemed to be services pursuant to the terms of
this Agreement.

3.04        Reimbursement to the Advisor.  The Company shall not reimburse the
Advisor for Total Operating Expenses to the extent that Total Operating Expenses
(including the Asset Management Fee), in the four consecutive fiscal quarters
then ended (the “Expense Year”) exceed (the “Excess Amount”) the greater of 2%
of Average Invested Assets or 25% of Net Income for such year.  Any Excess
Amount paid to the Advisor during a fiscal quarter shall be repaid to the
Company.  Reimbursement of all or any portion of the Total Operating Expenses
that exceed the limitation set forth in the preceding sentence may, at the
option of the Advisor, be deferred without interest and may be reimbursed in any
subsequent Expense Year where such limitation would permit such reimbursement if
the Total Operating Expense were incurred during such period. Notwithstanding
the foregoing, if there is an Excess Amount in any Expense Year and the
Independent Directors determine that such excess was justified, based on unusual
and nonrecurring factors which they deem sufficient, the Excess Amount may be
reimbursed to the Advisor.  Within 60 days after the end of any fiscal quarter
of the Company for which there is an Excess Amount which the Independent
Directors conclude was justified and reimbursable to the Advisor, there shall be
sent to the Stockholders a written disclosure of such fact, together with an
explanation of the factors the Independent Directors considered in determining
that such Excess Amount was justified. Such determination shall be reflected in
the minutes of the meetings of the Board.  The Company will not reimburse the
Advisor or its Affiliates for services for which the Advisor or its Affiliates
are entitled to compensation in the form of a separate fee.  All figures used in
any computation pursuant to this Section 3.04 shall be determined in accordance
with generally accepted accounting principles applied on a consistent basis.

ARTICLE IV

TERM AND TERMINATION

4.01        Term; Renewal.  Subject to Section 4.02 hereof, this Agreement shall
continue in force until the first anniversary of the date hereof.  Thereafter,
this Agreement may be renewed for an unlimited number of successive one-year
terms upon mutual consent of the parties.  It is the duty of the Board to
evaluate the performance of the Advisor annually before renewing the Agreement,
and each such renewal shall be for a term of no more than one year.

4.02        Termination.  This Agreement will automatically terminate upon
Listing.  This agreement also may be terminated at the option of either party
(i) immediately upon a Change of Control or (ii) upon 60 days written notice
without cause or penalty (in either case, if termination is by the Company, then
such termination shall be upon the approval of a majority of the Independent
Directors).  Notwithstanding the foregoing, the provisions of this Agreement
which provide for payment to the

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Advisor of expenses, fees or other compensation following the date of
termination (i.e., Sections 3.01(e) and 4.03) shall continue in full force and
effect until all amounts payable thereunder to the Advisor are paid in full.

4.03        Payments to and Duties of Advisor upon Termination.

(a)           After the Termination Date, the Advisor shall not be entitled to
compensation for further services hereunder except it shall be entitled to and
receive from the Company within 30 days after the effective date of such
termination all unpaid reimbursements of expenses, subject to the provisions of
Section 3.04 hereof, and all contingent liabilities related to fees payable to
the Advisor prior to termination of this Agreement, provided that the
Subordinated Incentive Listing Fee, if any, shall be paid in accordance with the
provisions of Section 3.01(e).  In the event the Subordinated Incentive Listing
Fee is paid to the Advisor following Listing, no Performance Fee will be paid to
the Advisor pursuant to Sections 4.03(b) below.

(b)           Upon termination, unless such termination is by the Company
because of a material breach of this Agreement by the Advisor, or upon Listing
(in which case the Subordinated Incentive Listing Fee will be paid in accordance
with the provisions of Section 3.01(e)), the Advisor shall be entitled to
receive a Performance Fee payable in the form of an interest bearing promissory
note (the “Performance Fee Note”) in a principal amount equal to the product of
0.15 times the amount, if any, by which (i) the Company Value plus the total
Distributions paid to holders of Shares through the Termination Date, exceeds
(ii) the sum of the aggregate Invested Capital plus the Stockholders’ 10% Return
through the Termination Date.  Interest on the Performance Fee Note will accrue
beginning on the Termination Date at a rate deemed fair and reasonable by the
Independent Directors.  The Company shall repay the Performance Fee Note using
the entire Net Sales Proceeds of each Sale after the Termination Date until the
Performance Fee Note is paid in full, with interest.  If the Performance Fee
Note has not been paid in full within five years from the Termination Date, then
the Advisor, its successors or assigns, may elect to convert the balance of the
Performance Fee Note, including accrued but unpaid interest, into Shares at a
price per Share equal to the average Closing Price of the Shares over the ten
trading days immediately preceding the date of such election if the Shares are
Listed at such time.  If the Shares are not Listed at such time, the Advisor,
its successors or assigns, may elect to convert the balance of the Performance
Fee Note, including accrued but unpaid interest, into Shares at a price per
Share equal to the fair market value for the Shares as determined by the Board
based upon the Appraised Value of the Assets on the date of election.  In no
event will the amount paid to the Advisor under the Performance Fee Note,
including interest, exceed the amount considered presumptively reasonable under
Section IV.F. of the NASAA REIT Guidelines in effect on the date hereof (the
“NASAA Limit”).  In such event, the aggregate amount payable under the
Performance Fee Note, including interest, shall be reduced to an amount equal to
the NASAA Limit.

(c)           In the event that the Advisor disagrees with the valuation of
Shares pursuant to Section 4.03(b) where the Shares are not Listed, for purposes
of determining the number of shares to be issued to the Advisor following the
Advisor’s election to convert the balance of the Performance Fee Note owed to
the Advisor, then the fair market value of such shares shall be determined by an
independent appraiser of equity value selected by the Advisor and the Company. 
If the Advisor and the Company are unable to agree upon an expert independent
appraiser, then each of the Company and the Advisor shall name one appraiser and
the two named appraisers shall promptly agree in good faith to the appointment
of one such appraiser whose determination shall be final and binding on the
parties.  The cost of such appraisal shall be shared evenly between the Company
and the Advisor.

 

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(d)           The Advisor shall promptly upon termination:

(i)            pay over to the Company all money collected and held for the
account of the Company pursuant to this Agreement, after deducting any accrued
compensation and reimbursement for its expenses to which it is then entitled;

(ii)           deliver to the Board a full accounting, including a statement
showing all payments collected by it and a statement of all money held by it,
covering the period following the date of the last accounting furnished to the
Board;

(iii)          deliver to the Board all assets, including the Assets, and
documents of the Company then in the custody of the Advisor; and

(iv)          cooperate with the Company and take all reasonable actions
requested by the Company to provide an orderly management transition.

ARTICLE V

INDEMNIFICATION

5.01        Indemnification by the Company.

(a)           The Company shall indemnify and hold harmless the Advisor and its
Affiliates, including their respective officers, directors, partners and
employees, from all liability, claims, damages or losses arising in the
performance of their duties hereunder, and related expenses, including
reasonable attorneys’ fees, to the extent such liability, claims, damages or
losses and related expenses are not fully reimbursed by insurance, subject to
any limitations imposed by the laws of the State of Maryland, the Articles of
Incorporation and the NASAA Guidelines.  Notwithstanding the foregoing, under
the Articles of Incorporation, the Company shall not indemnify or hold harmless
the Advisor or its Affiliates, including their respective officers, directors,
partners and employees, for any liability or loss suffered by the Advisor or its
Affiliates, including their respective officers, directors, partners and
employees, nor shall it provide that the Advisor or its Affiliates, including
their respective officers, directors, partners and employees, be held harmless
for any loss or liability suffered by the Company, unless all of the following
conditions are met:  (i) the Advisor or its Affiliates, including their
respective officers, directors, partners and employees, have determined, in good
faith, that the course of conduct which caused the loss or liability was in the
best interests of the Company; (ii) the Advisor or its Affiliates, including
their respective officers, directors, partners and employees, were acting on
behalf of or performing services of the Company; (iii) such liability or loss
was not the result of negligence or misconduct by the Advisor or its Affiliates,
including their respective officers, directors, partners and employees; and (iv)
such indemnification or agreement to hold harmless is recoverable only out of
the Company’s net assets and not from stockholders.  Notwithstanding the
foregoing, the Advisor and its Affiliates, including their respective officers,
directors, partners and employees, shall not be indemnified by the Company for
any losses, liability or expenses arising from or out of an alleged violation of
federal or state securities laws by such party unless one or more of the
following conditions are met:  (i) there has been a successful adjudication on
the merits of each count involving alleged securities law violations as to the
particular indemnitee; (ii) such claims have been dismissed with prejudice on
the

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merits by a court of competent jurisdiction as to the particular indemnitee; and
(iii) a court of competent jurisdiction approves a settlement of the claims
against a particular indemnitee and finds that indemnification of the settlement
and the related costs should be made, and the court considering the request for
indemnification has been advised of the position of the Securities and Exchange
Commission and of the published position of any state securities regulatory
authority in which securities of the Company were offered or sold as to
indemnification for violations of securities laws.

(b)           The Articles of Incorporation provide that the advancement of
Company funds to the Advisor or its Affiliates, including their respective
officers, directors, partners and employees, for legal expenses and other costs
incurred as a result of any legal action for which indemnification is being
sought is permissible only if all of the following conditions are satisfied: 
(i) the legal action relates to acts or omissions with respect to the
performance of duties or services on behalf of the Company; (ii) the legal
action is initiated by a third-party who is not a stockholder or the legal
action is initiated by a stockholder acting in his or her capacity as such and a
court of competent jurisdiction specifically approves such advancement; (iii)
the Advisor or its Affiliates, including their respective officers, directors,
partners and employees, undertake to repay the advanced funds to the Company
together with the applicable legal rate of interest thereon, in cases in which
such Advisor or its Affiliates, including their respective officers, directors,
partners and employees, are found not to be entitled to indemnification.

(c)           The indemnity provided for pursuant to this Section 5.01 shall
extend, without limitation, to any claims to the extent relating to any of the
events or outcomes set forth in the Prospectus as possible results, outcomes or
risks associated with the business and investment objectives of the Company. 
Notwithstanding the provisions of this Section 5.01, the Advisor shall not be
entitled to indemnification or be held harmless pursuant to this Section 5.01
for any activity which the Advisor shall be required to indemnify or hold
harmless the Company pursuant to Section 5.02.

5.02        Indemnification by Advisor.  The Advisor shall indemnify and hold
harmless the Company from contract or other liability, claims, damages, taxes or
losses and related expenses including attorneys’ fees, to the extent that such
liability, claims, damages, taxes or losses and related expenses are not fully
reimbursed by insurance and are incurred by reason of the Advisor’s bad faith,
fraud, misfeasance, misconduct, negligence or reckless disregard of its duties,
but the Advisor shall not be held responsible for any action of the Board in
following or declining to follow any advice or recommendation given by the
Advisor.

ARTICLE VI

MISCELLANEOUS

6.01        Assignment to an Affiliate.  This Agreement may be assigned by the
Advisor to an Affiliate of the Advisor with the approval of a majority of the
Board (including a majority of the Independent Directors).  The Advisor may
assign any rights to receive fees or other payments under this Agreement without
obtaining the approval of the Board.  This Agreement shall not be assigned by
the Company without the consent of the Advisor, except in the case of an
assignment by the Company to a corporation or other organization which is a
successor to all of the assets, rights and obligations of the Company, in which
case such successor organization shall be bound hereunder and by the terms of
said assignment in the same manner as the Company is bound by this Agreement. 
This Agreement shall be

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binding on successors to the Company resulting from a Change of Control or sale
of all or substantially all the assets of the Company or the Partnership, and
shall likewise be binding upon any successor to the Advisor.

6.02        Relationship of Advisor and Company.  The Company and the Advisor
are not partners or joint venturers with each other, and nothing in this
Agreement shall be construed to make them such partners or joint venturers or
impose any liability as such on either of them.

6.03        Treatment Under Texas Margin Tax.  For purposes of the Texas margin
tax, the Advisor’s performance of the services specified in this Agreement will
cause the Advisor to conduct part of the active trade or business of the
Company, and the compensation specified in Article III includes both the payment
of management fees and the reimbursement of specified costs incurred in the
Advisor’s conduct of the active trade or business of the Company.  Therefore,
the Advisor and Company intend Advisor to be, and shall treat Advisor as, a
“management company” within the meaning of Section 171.0001(11) of the Texas Tax
Code.  The Company and the Advisor will apply Sections 171.1011(m-1) and
171.1013(f)-(g) of the Texas Tax Code to the Company’s reimbursements paid to
the Advisor pursuant to this Agreement of specified costs and wages and
compensation.  The Advisor and the Company further recognize and intend that (i)
as a result of the fiduciary relationship created by this Agreement and
acknowledged in Section 2.02, reimbursements paid to the Advisor pursuant to
this Agreement are “flow-though funds” that the Advisor is mandated by law or
fiduciary duty to distribute, within the meaning of Section 171.1011(f) of the
Texas Tax Code, and (ii) as a result of Advisor’s contractual duties under this
Agreement, certain reimbursements under this Agreement are “flow-through funds”
mandated by contract to be distributed within the meaning of Section 171.1011(g)
of the Texas Tax Code.  The terms of this Agreement shall be interpreted in a
manner consistent with the characterization of the Advisor as a “management
company” as defined in Section 171.0001(11), and with the characterization of
the reimbursements as “flow-though funds” within the meaning of Section
171.1011(f)-(g) of the Texas Tax Code.

6.04        Notices.  Any notice, report or other communication required or
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report or other communication is required by the Articles of
Incorporation, the Bylaws, or accepted by the party to whom it is given, and
shall be given by being delivered by hand or by overnight mail or other
overnight delivery service to the addresses set forth herein:

To the Directors and to the Company:

 

Behringer Harvard Opportunity REIT I, Inc.

 

 

15601 Dallas Parkway

 

 

Suite 600

 

 

Addison, Texas 75001

 

 

 

To the Advisor:

 

Behringer Harvard Opportunity Advisors I LP

 

 

15601 Dallas Parkway

 

 

Suite 600

 

 

Addison, Texas 75001

 

Either party shall, as soon as reasonably practicable, give notice in writing to
the other party of a change in its address for the purposes of this Section
6.03.

6.05        Modification.  This Agreement shall not be changed, modified, or
amended, in whole or in part, except by an instrument in writing signed by both
parties hereto, or their respective successors or assignees.

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6.06        Severability.  The provisions of this Agreement are independent of
and severable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be invalid or unenforceable in whole or in part.

6.07        Choice of Law; Venue.  The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of Texas, and
venue for any action brought with respect to any claims arising out of this
Agreement shall be brought exclusively in Dallas County, Texas.

6.08        Entire Agreement.  This Agreement contains the entire agreement and
understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements, understandings,
inducements and conditions, express or implied, oral or written, of any nature
whatsoever with respect to the subject matter hereof.  The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof. This Agreement may not be modified or
amended other than by an agreement in writing signed by each of the parties
hereto.

6.09        Waiver.  Neither the failure nor any delay on the part of a party to
exercise any right, remedy, power or privilege under this Agreement shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, remedy, power or privilege preclude any other or further exercise of the
same or of any other right, remedy, power or privilege, nor shall any waiver of
any right, remedy, power or privilege with respect to any occurrence be
construed as a waiver of such right, remedy, power or privilege with respect to
any other occurrence.  No waiver shall be effective unless it is in writing and
is signed by the party asserted to have granted such waiver.

6.10        Gender; Number.  Words used herein regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context requires.

6.11        Headings.  The titles and headings of sections and subsections
contained in this Agreement are for convenience only, and they neither form a
part of this Agreement nor are they to be used in the construction or
interpretation hereof.

6.12        Execution in Counterparts.  This Agreement may be executed in
multiple counterparts, each of which shall be deemed to be an original as
against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument.  This Agreement shall become
binding when one or more counterparts hereof, individually or taken together,
shall bear the signatures of all of the parties reflected hereon as the
signatories.

6.13        Name.  Behringer Harvard Opportunity Advisors I LP and/or one or
more of its Affiliates has a proprietary interest in the names “Harvard” (for
the businesses engaged in by the Company and its Affiliates) and “Behringer”
(for all purposes).  Accordingly, and in recognition of this right, if at any
time the Company ceases to retain Behringer Harvard Opportunity Advisors I LP or
an Affiliate thereof to perform the services of Advisor, the Company will,
promptly after receipt of written request from Behringer Harvard Opportunity
Advisors I LP, cease to conduct business under or use the name “Harvard” or
“Behringer” or any diminutive thereof and the Company shall use its best efforts
to change the name of the Company to a name that does not contain the name
“Harvard” or “Behringer” or any other word or words that might, in the sole
discretion of Behringer Harvard Opportunity Advisors I LP LP, be susceptible of
indication of some form of relationship between the Company and Behringer
Harvard Opportunity Advisors I LP or any Affiliate thereof. Consistent with the
foregoing, it is specifically recognized that Behringer Harvard Opportunity
Advisors I LP or one or more of its Affiliates has in the past and may in the
future organize, sponsor or otherwise permit to exist other investment

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vehicles (including vehicles for investment in real estate) and financial and
service organizations having “Harvard” or “Behringer” as a part of their name,
all without the need for any consent (and without the right to object thereto)
by the Company or its Board.

6.14        Initial Investment.  The Advisor or one of its Affiliates has
contributed $200,000 (the “Initial Investment”) in exchange for the initial
issuance of Shares of the Company.  The Advisor or its Affiliates may not sell
any of the Shares purchased with the Initial Investment while the Advisor acts
in an advisory capacity to the Company.  The restrictions included above shall
not apply to any Shares acquired by the Advisor or its Affiliates other than the
Shares acquired through the Initial Investment.  Neither the Advisor nor its
Affiliates shall vote any Shares they now own, or hereafter acquires, in any
vote for the election of Directors or any vote regarding the approval or
termination of any contract with the Advisor or any of its Affiliates.

6.15        Ownership of Proprietary Property.  The Advisor retains ownership of
and reserves all Intellectual Property Rights in the Proprietary Property.  To
the extent that the Company has or obtains any claim to any right, title or
interest in the Proprietary Property, including without limitation in any
suggestions, enhancements or contributions that Company may provide regarding
the Proprietary Property, the Company hereby assigns and transfers exclusively
to the Advisor all right, title and interest, including without limitation all
Intellectual Property Rights, free and clear of any liens, encumbrances or
licenses in favor of the Company or any other party, in and to the Proprietary
Property.  In addition, at the Advisor’s expense, the Company will perform any
acts that may be deemed desirable by the Advisor to evidence more fully the
transfer of ownership of right, title and interest in the Proprietary Property
to the Advisor, including but not limited to the execution of any instruments or
documents now or hereafter requested by the Advisor to perfect, defend or
confirm the assignment described herein, in a form determined by the Advisor.

[The remainder of this page has been intentionally left blank]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated
Advisory Management Agreement as of the date and year first above written.

 

 

BEHRINGER HARVARD OPPORTUNITY
   REIT I, INC.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Gerald J. Reihsen, III

 

 

 

 

 

Gerald J. Reihsen, III

 

 

 

 

 

Executive Vice President — Corporate

 

 

 

 

 

   Development and Legal

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BEHRINGER HARVARD OPPORTUNITY
   ADVISORS I, LP

 

 

 

 

 

 

 

 

 

 

By:

Harvard Property Trust, LLC,

 

 

 

 

 

its General Partner

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Gerald J. Reihsen, III

 

 

 

 

 

 

Gerald J. Reihsen, III

 

 

 

 

 

 

Executive Vice President — Corporate

 

 

 

 

 

 

   Development and Legal

 

 

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