--------------------------------------------------------------------------------

Exhibit 10.1

CORNERSTONE CORE PROPERTIES REIT, INC.

DEALER MANAGER AGREEMENT

Up to 77,350,000 Shares of Common Stock

Pacific Cornerstone Capital, Incorporated
1920 Main Plaza, Suite 400
Irvine, California 92614

Dear Sirs:

Cornerstone Core Properties REIT, Inc., a Maryland corporation (the “Company”),
is registering for public sale a maximum of 77,350,000 shares of its common
stock, $0.001 par value per share, (the “Shares”), to be issued and sold for an
aggregate maximum purchase price of $610,360,000 (56,250,000 Shares to be
offered to the public in a primary offering with an aggregate maximum purchase
price of $450,000,000 (the “Primary Offering”) and 21,100,000 Shares to be
offered pursuant to the Company's distribution reinvestment plan with an
aggregate maximum purchase price of $160,360,000 (“DRP”)). The Shares are to be
sold to selected persons or entities acceptable to the Company, upon the terms
and subject to the conditions set forth in the enclosed Prospectus.

The Company hereby invites you, Pacific Cornerstone Capital, Inc., a California
corporation (the “Dealer Manager”), to become the dealer manager in connection
with the offer and sale of the Shares. By your acceptance hereof, you agree to
act in such capacity and to use commercially reasonable efforts to find
purchasers for the Shares in accordance with the terms and conditions of the
Prospectus (defined below) and this dealer manager agreement (the “Agreement”),
but with no obligation or understanding, express or implied, that you are making
a commitment to purchase or sell the Shares. You agree to use commercially
reasonable efforts to find purchasers of Shares both directly and indirectly
through a selling group consisting of participating brokers (the “Participating
Brokers”) with whom you shall contract pursuant to a participating broker
agreement substantially in the form attached as Attachment 1 hereto (the
“Participating Broker Agreement”) or such other form as may be requested by a
Participating Broker provided the consent of the Company is obtained for the use
of such form.

Accompanying this Agreement is a copy of the Prospectus and the Supplemental
Material (defined below) prepared by the Company for use in conjunction with the
offer and sale of the Shares. You are not authorized to use any solicitation
material other than that referred to in this section, which material has been
furnished by the Company.

Except as described in the Prospectus or in Sections 3(f) and (g) hereof, the
Shares are to be sold for a per Share cash price as follows:

Distribution Channel
 
Primary Offering
   
DRP Offering
 
Participating Brokers
  $ 8.00     $ 7.60  
Participating Brokers Deferring Commission*
  $ 7.52     $ 7.60  
Fee for Service Investment Advisers
  $ 7.44     $ 7.60  

* For a period of six years following the date of purchase, an additional $0.10
per share will be deducted annually from cash distributions otherwise payable to
the purchaser and will be used to pay deferred commissions.

1.
Representations and Warranties of the Company

The Company represents and warrants to Dealer Manager and Participating Brokers
that:

 
 

--------------------------------------------------------------------------------

 

(a)           The Company has prepared and filed with the Securities and
Exchange Commission (the “SEC”) a registration statement (Registration No.
333-155640) for the registration of the Shares under the Securities Act of 1933,
as amended (the “Securities Act”), and the applicable rules and regulations
promulgated thereunder. Copies of such registration statement as initially filed
and each amendment thereto have been or will be delivered to the Dealer Manager.
The registration statement and the prospectus contained therein, as finally
amended at the effective date of the registration statement, are respectively
hereinafter referred to as the “Registration Statement” and the “Prospectus,”
except that if the Company files a prospectus or prospectus supplement pursuant
to Rule 424(b) under the Securities Act, or if the Company files a
post-effective amendment to the Registration Statement, the term “Prospectus”
includes the prospectus filed pursuant to Rule 424(b) or the prospectus included
in such post-effective amendment. The term “Preliminary Prospectus” as used
herein shall mean a preliminary prospectus related to the Shares as contemplated
by Rule 430 or Rule 430A under the Securities Act included at any time as part
of the Registration Statement.

(b)           On the date that any Preliminary Prospectus was filed with the
SEC, on the effective date of the Registration Statement, on the date of the
Prospectus, and when any post-effective amendment to the Registration Statement
becomes effective or any amendment or supplement to the Prospectus is filed with
the SEC, the Registration Statement, each Preliminary Prospectus and the
Prospectus, as applicable, including the financial statements contained therein,
complied or will comply with the Securities Act and the applicable rules and
regulations promulgated thereunder. On the effective date, the Registration
Statement did not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading. On the date of the Prospectus, as amended or supplemented,
as applicable, the Prospectus did not or will not contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, however,
that the foregoing provisions of this Section 1(b) will not extend to such
statements contained in or omitted from the Registration Statement or the
Prospectus, as amended or supplemented, as are primarily within the knowledge of
the Dealer Manager or any of the Participating Brokers and are based upon
information furnished by the Dealer Manager in writing to the Company
specifically for inclusion therein.

(c)           All additional written, audio or audio-visual material, including
an investment summary, audio tape, video tape and internet site prepared by the
Company for use in conjunction with the offer or sale of the Shares
(“Supplemental Material”) will be distributed by the Company only in full
compliance with the requirements of the Act (including, without limitation, the
requirement that such Supplemental Material not be delivered to any prospective
purchaser unless accompanied or preceded by a Prospectus), and at the time the
Registration Statement is declared effective and at all times subsequent thereto
up to and including the Offering Termination Date (as defined in Section 5
below), such Supplemental Material has not contained and will not contain any
untrue statement of material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.

(d)           No order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus has been issued and no proceedings for that purpose
are pending, threatened, or, to the knowledge of the Company, contemplated by
the SEC; and to the knowledge of the Company, no order suspending the offering
of the Shares in any jurisdiction has been issued and no proceedings for that
purpose have been instituted or threatened or are contemplated.

(e)           The Company intends to use the funds received from the sale of the
Shares as set forth in the Prospectus.

(f)            The Company has obtained an opinion of DLA Piper LLP (US)
confirming that, the Company has qualified for taxation as a REIT commencing
with the taxable year ended December 31, 2006.  The conditions on which the
opinion was issued were met at the time of such issuance and will continue to
exist during the Offering Period unless the board of directors of the Company
determines that qualification as a REIT is no longer in the best interests of
the Company, in which case the Company will promptly provide the Dealer Manager
notice of such determination.

(g)           The accounting firm that has certified or shall certify the
financial statements filed and to be filed with the SEC as part of the
Registration Statement and the Prospectus is a registered public accounting
firm, as required by the Act and the rules and regulations promulgated
thereunder.

 
 

--------------------------------------------------------------------------------

 

(h)           The Company is a corporation duly organized under the laws of the
State of Maryland, is validly existing as a corporation under such laws and has
power and authority to conduct business as described in the Prospectus under the
laws of the State of Maryland and every other jurisdiction in which it conducts
business or owns or leases property.

(i)             The Company has full legal right, power and authority to enter
into this Agreement and to perform the transactions contemplated hereby, and the
Company has duly authorized, executed and delivered this Agreement.

(j)            This Agreement is a valid, legal, and binding agreement of the
Company enforceable in accordance with its terms, except to the extent that the
enforceability of the indemnity provisions contained in Section 8 hereof may be
limited under applicable securities laws and to the extent that the
enforceability of this Agreement may be limited by bankruptcy, insolvency or
similar laws affecting the rights of creditors generally.

(k)           The execution and delivery of this Agreement, the consummation of
the transactions herein contemplated and the compliance with the terms of this
Agreement by the Company will not conflict with or constitute a default or
violation under any charter, by-law, contract, indenture, mortgage, deed of
trust, lease, rule, regulation, writ, injunction or decree of any government,
governmental instrumentality or court, domestic or foreign, having jurisdiction
over the Company.

(l)             No further consent, approval, authorization or other order of
any governmental authority is required in connection with the execution or
delivery by the Company of this Agreement or the issuance and sale by the
Company of the Shares, except such as may be required under the securities laws
of certain states, if any, which we have identified to you.

(m)           At the time of the issuance of the Shares, the Shares will have
been duly authorized and, upon payment therefor as provided in this Agreement,
will be validly issued, fully paid and nonassessable and will conform to the
description thereof contained in the Prospectus.

(n)           At all times subsequent to the date of this Agreement and up to
and including the Offering Termination Date (as defined in Section 5 below), the
representations and warranties made in this Section l will be true and correct
with the same effect as if they had been made on and as of such time, except as
may subsequently be disclosed in writing to the Dealer Manager.

2.
Representations and Warranties of the Dealer Manager

As an inducement to the Company to enter into this Agreement, the Dealer Manager
represents and warrants to the Company that:

(a)           The Dealer Manager is a member of the Financial Industry
Regulatory Authority (“FINRA”) in good standing and a broker-dealer registered
as such under the Securities Exchange Act of 1934, as amended, and under the
securities laws of the states in which the Shares are to be offered and sold.
The Dealer Manager and its employees and representatives have all required
licenses and registrations to act under this Agreement.

(b)           The Dealer Manager has full legal right, power and authority to
enter into this Agreement and to perform the transactions contemplated hereby,
and the Dealer Manager has duly authorized, executed and delivered this
Agreement.

(c)           This Agreement is a valid, legal, and binding agreement of the
Dealer Manager enforceable in accordance with its terms, except to the extent
that the enforceability of the indemnity provisions contained in Section 8
hereof may be limited under applicable securities laws and to the extent that
the enforceability of this Agreement may be limited by bankruptcy, insolvency or
similar laws affecting the rights of creditors generally.

(d)           The execution and delivery of this Agreement, the consummation of
the transactions herein contemplated and the compliance with the terms of this
Agreement by the Dealer Manager will not conflict with or constitute a default
or violation under any charter, by-law, contract, indenture, mortgage, deed of
trust, lease, rule, regulation, writ, injunction or decree of any government,
governmental instrumentality or court, domestic or foreign, having jurisdiction
over the Dealer Manager.

 
 

--------------------------------------------------------------------------------

 

(e)            No consent, approval, authorization or other order of any
governmental authority is required in connection with the execution, delivery or
performance by the Dealer Manager of this Agreement.

(f)            The Dealer Manager represents and warrants to the Company and
each person that signs the Registration Statement that the information under the
caption “Plan of Distribution” in the Prospectus and all other information
furnished to the Company by the Dealer Manager in writing expressly for use in
the Registration Statement, any Preliminary Prospectus, or the Prospectus, does
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading.

(g)           All training and education meetings held by the Dealer Manager
will be in compliance with Rule 5110 (i)(2) of the FINRA rules. Dealer Manager
will require each Participating Broker to represent that all training and
education meetings held by the Participating Broker will be in compliance with
Rule 5110(i)(2) of the FINRA rules.

(h)           Dealer Manager will obtain FINRA approval of any sales incentive
program developed by the Dealer Manager prior to its implementation. Dealer
Manager will require each Participating Broker to represent that all sales
incentive and bonus programs designed by the Participating Broker for its
registered representatives will comply with the FINRA rules.  For purposes of
this Agreement, references to “FINRA rules,” “rules of FINRA” or similar
variations, shall include, unless otherwise expressly stated or context
otherwise requires, NASD and FINRA rules currently in effect and any successor
or subsequent rules adopted by FINRA as part of its consolidated rulebook or
otherwise.

(i)             Dealer Manager has established and will maintain, and will
require Participating Brokers to establish and maintain, a customer
identification program which requires Dealer Manager, or the Participating
Broker, as applicable, to (i) verify the identify of any person seeking to
purchase the Shares through Dealer Manager, or the Participating Broker, as
applicable, to the extent reasonable and practicable, (ii) maintain records of
the information used to verify the person's identity and (iii) determine whether
the person appears on any lists of known or suspected terrorists or terrorist
organizations provided to brokers or dealers by any government agency, in all
accordance with the requirements of 31 C.F.R. Section 103.122.

(j)             Dealer Manager has established and will maintain an anti-money
laundering compliance program in accordance with applicable laws and
regulations, including the USA Patriot Act of 2001, and in accordance with NASD
Rule 3011 (or successor FINRA rule) and the related interpretive guidance
described in NASD’s IM-3011-1 and IM-3011-2 (or successor FINRA interpretive
guidance), and Dealer Manager will require each of the Participating Brokers to
establish and maintain such a program.

3.
Obligations and Compensation of Dealer Manager

(a)            The Company hereby appoints the Dealer Manager as its agent and
principal distributor during the Offering Period (as defined in Section 3(c))
for the purpose of finding, on a best efforts basis, purchasers for the Shares
for cash through the Participating Brokers, all of whom shall be members of
FINRA. The Dealer Manager may also arrange for the sale of Shares for cash
directly to its own clients and customers at the public offering price and
subject to the terms and conditions stated in the Prospectus. The Dealer Manager
hereby accepts such agency and distributorship and agrees to use its best
efforts to find purchasers for the Shares on said terms and conditions,
commencing as soon as practicable.

(b)           The “Offering Period” shall mean that period during which Shares
may be offered for sale, commencing on the date the registration was made
effective by the SEC, during which period offers and sales of the Shares shall
occur continuously in the jurisdictions in which the Shares are registered or
qualified or exempt from registration (as confirmed in writing by the Company to
the Dealer Manager) unless and until the Offering is terminated as provided
herein, except that the Dealer Manager and the Participating Brokers shall
suspend or terminate offering of the Shares upon request of the Company at any
time and shall resume offering the Shares upon subsequent request of the
Company. The Offering Period shall in all events terminate upon the sale of all
of the Shares. Upon termination of the Offering Period, the Dealer Manager's
agency and this Agreement shall terminate without obligation on the part of the
Dealer Manager or the Company except as set forth in this Agreement.

(c)            Except as may be provided in the “Plan of Distribution” section
of the Prospectus, as compensation for the services rendered by the Dealer
Manager, the Company agrees that it will pay to the Dealer Manager selling
commissions plus a dealer manager fee as follows (based on a selling price of
$8.00 per Share):

 
 

--------------------------------------------------------------------------------

 

   
Selling Commissions
 
Distribution Channel
 
Primary Offering
   
DRP Offering
 
Participating Brokers
    7.0 %     0.0 %
Fee for Service Investment Advisers
    0.0 %     0.0 %

   
Dealer Manager Fee
 
Distribution Channel
 
Primary Offering
   
DRP Offering
 
Participating Brokers
    3.0 %     0.0 %
Fee for Service Investment Advisers
    3.0 %     0.0 %

If the Dealer Manager, the Participating Broker and the investor agree, the
selling commissions can be paid on a deferred basis for Shares sold in the
primary offering. In these instances, the Company will sell the Shares at a
reduced price as set forth above and pay the Dealer Manager a correspondingly
reduced sales commission at the time of sale. The balance of the normal
commission would be paid to the Dealer Manager over six years for Shares sold in
the primary offering, out of the dividends or other distributions that are
declared and paid with respect to the reduced-priced shares sold through the
Dealer Manager or Participating Broker. The amount by which by the investor's
dividends are reduced in these cases would be paid by the Company as deferred
commissions to the Dealer Manager (and by the Dealer Manager to the
Participating Brokers for Shares sold by the Participating Brokers).

As an example, investors electing the deferred commission option for Shares
purchased in the primary offering will pay, on the date of purchase, $7.52 per
Share (which includes a commission of $0.08 per Share). For a period of six
years following the date of purchase, an additional $0.08 per Share will be
deducted annually from dividends or other cash distributions otherwise payable
to the investor and will be used to pay deferred commissions. The net proceeds
to the Company will not be affected by the election of the deferred commission
option. Under this arrangement, an investor electing the deferred commission
option will pay a 1% commission upon subscription, rather than a 7% commission,
and an amount equal to a 1% commission per year thereafter for the next six
years, or longer if required to satisfy outstanding deferred commission
obligations, will be deducted from dividends or other cash distributions
otherwise payable to such stockholder. The Company may also use other deferred
commission structures, but the Company will not pay total commissions in excess
of 7% of the offering price of the Shares.

If at any time prior to the satisfaction of the Company's remaining deferred
commission obligations, the Company decides to list its common stock for trading
on national securities exchange, or the Company begins a liquidation of its
properties, the Company may accelerate the remaining commissions due under the
deferred commission option. To the extent that the distributions prior to
listing are insufficient to satisfy the remaining commissions due, the
obligations of the Company and the investor to pay any further deferred
commissions will terminate, and the Dealer Manager and the Participating Brokers
will not be entitled to receive any further portion of their deferred
commissions following listing of the Company's common stock.

In addition, if an investor that has elected the deferred commission option
decides to participate in the Company’s share redemption program or requests
that the Company transfer such stockholder’s Shares for any reason prior to the
time that the remaining deferred selling commissions have been deducted from
such stockholder’s cash distributions, the Company will accelerate the selling
commissions due under the Deferred Commission Option as set forth in the
Prospectus.

 
 

--------------------------------------------------------------------------------

 

(d)           The Company will also reimburse the Dealer Manager for all items
of underwriter compensation referenced in the Prospectus to the extent the
Prospectus indicates that they will be paid by the Company, provided that the
Company’s reimbursement payments shall not cause (i) total underwriting
compensation (excluding reimbursement of bona fide invoiced due diligence
expenses) to exceed 10% of gross offering proceeds from the sale of the
56,250,000 shares offered to the public or (ii) total Organization and Offering
Expenses (as defined in Article IV of the Company’s charter included as an
exhibit to the Registration Statement) to exceed 15% of gross offering proceeds
from the sale of the 56,250,000 shares offered to the public.

(e)            In conformity with NASD Conduct Rule 2810(b)(4)(B)(vii) (or
successor FINRA rule), the Company will also pay the Dealer Manager for bona
fide due diligence expenses of the Dealer Manager and the Participating Brokers,
and subject to the terms and conditions, as may be allowed by any subsequent
FINRA Rule or Notice to Members.

(f)            As described in the Prospectus, the Dealer Manager agrees to sell
Shares in the primary offering to persons identified by the Company as
affiliates of the Company.  The purchase price for Shares under this program
will be $7.60 per share, reflecting that selling commissions in the amount of
$0.40 per Share will not be payable in connection with such sales.  The Dealer
Manager agrees to work together with the Company to implement this program and
to execute sales under the program according to the procedures agreed upon by
the Dealer Manager and the Company.

(g)           In addition, as described in the Prospectus, the Dealer Manager
may sell shares to Dealers, their retirement plans, their representatives and
the family members, IRAs and the qualified plans of their representatives at a
purchase price of $7.60 per share, reflecting that selling commissions in the
amount of $0.40 per share will not be payable in consideration of the services
rendered by such Dealers and representatives in the Offering.  For purposes of
this discount, a family member includes such person’s spouse, parent, child,
sibling, mother- or father-in-law, son- or daughter-in law or brother- or
sister-in-law.

4.
Sale of the Shares

(a)           A subscription agreement (“Subscription Agreement”) must be
completed by each person desiring to purchase Shares, or, at Dealer Manager's or
Participating Broker's option, by Dealer Manager or Participating Broker on
behalf of each such person, and returned by Dealer Manager or Participating
Broker together with any other documents that may be required under state
securities laws or by the Company, to the Company at 1920 Main Plaza, Suite 400,
Irvine, California 92614, Attention: Terry G. Roussel. The Dealer Manager or
Participating Broker shall ascertain that the Subscription Agreement has been
properly completed in full and signed by the prospective purchaser prior to its
return.

(b)           All subscription checks shall be made payable to the order of
CORNERSTONE CORE PROPERTIES REIT, INC.   If Dealer Manager or Participating
Broker receives a check not conforming to the foregoing instructions, Dealer
Manager and/or Participating Broker must return such check directly to the
subscriber not later than the end of the next business day following its
receipt.  Checks conforming to the foregoing instructions shall be transmitted
by Dealer Manager for deposit directly to the Company, at Cornerstone Core
Properties REIT, Inc., c/o Phoenix American Financial Services, Inc., 2401
Kerner Boulevard, San Rafael, CA 94901, as soon as practicable but in any event
by the end of the second business day following receipt by Dealer
Manager.  Checks conforming to the foregoing instructions shall be transmitted
by Participating Broker for deposit directly to the Company, at Cornerstone Core
Properties REIT, Inc., c/o Phoenix American Financial Services, Inc., 2401
Kerner Boulevard, San Rafael, CA 94901, as soon as practicable but in any event
by the end of the next business day following receipt by Participating
Broker.  In the event Participating Broker's final internal supervisory review
is conducted at a different location, then checks must be transmitted to
Participating Broker's final review office by the end of the next business day
following receipt by Participating Broker and Participating Broker's final
review office must in turn by the end of the next business day following receipt
by it, transmit the check for deposit directly to Cornerstone Core Properties
REIT, Inc., c/o Phoenix American Financial Services, Inc., 2401 Kerner
Boulevard, San Rafael, CA 94901.

(c)            Upon receipt of the Subscription Agreement, the Company, will
determine promptly (and in any event within thirty (30) days after such receipt)
whether it wishes to accept the proposed purchaser as a stockholder of the
Company, it being understood that the Company reserves the right to reject the
tender of any Subscription Agreement. Should the Company determine to accept the
tender of the Subscription Agreement, the Company will promptly advise Dealer
Manager or Participating Broker of such action. Should the Company determine to
reject the tender it will promptly notify in writing the prospective purchaser,
Dealer Manager and Participating Broker, if any, of such determination and will
promptly return the tendered Subscription Agreement and the purchase price of
the Shares directly to the prospective purchaser.

 
 

--------------------------------------------------------------------------------

 

(d)           The Dealer Manager will use all reasonable efforts to offer
Shares, and in its agreements with Participating Brokers will require that the
Participating Brokers offer Shares, only to persons who meet the financial
qualifications set forth in the Prospectus or in any suitability letter or
memorandum sent to it by the Company and will only make offers to persons in the
states in which it is advised in writing that the Shares are qualified for sale
or that such qualification is not required. In offering Shares, the Dealer
Manager will, and in its agreements with Participating Brokers, the Dealer
Manager will, require that the Participating Brokers comply with the provisions
of all applicable rules and regulations relating to suitability of investors,
including without limitation, the provisions of Article III.C. of the Statement
of Policy Regarding Real Estate Investment Trusts of the North American
Securities Administrators Association, Inc. (the “NASAA Guidelines”). In making
the determinations as to suitability required by the NASAA Guidelines, the
Dealer Manager may rely on representations from (i) investment advisers who are
not affiliated with a Participating Broker or (ii) banks acting as trustees or
fiduciaries. With respect to the maintenance of records required by the NASAA
Guidelines, the Company agrees that the Dealer Manager can satisfy its
obligations by contractually requiring such information to be maintained for a
period of at least six (6) years by the investment advisers or banks discussed
in the preceding sentence. Nothing contained in this Section 4(d) shall be
construed to impose upon the Company the responsibility of assuring that
prospective purchasers meet the suitability standards contained in the
Prospectus and the Subscription Agreement or to relieve Dealer Manager and
Participating Brokers of the responsibility of complying with the rules of
FINRA.

5.
Offering Termination Date

As used herein, the term “Offering Termination Date” shall mean the earliest to
occur of (i) the date upon which subscriptions for the maximum number of Shares
offered have been accepted by the Company which date the Company shall designate
by notice to Dealer Manager in writing; or (ii) June 10, 2011. The Company may
terminate the offering of Shares at any time for any reason by written notice to
the Dealer Manager at least two (2) business days prior to the date of
termination.

6.
Covenants of the Company

(a)           The Company covenants and agrees that it will pay or cause to be
paid (i) all expenses and fees in connection with the preparation, printing,
filing, delivery and shipping of the Registration Statement (including this
Agreement and all other exhibits to the Registration Statement), the Prospectus
(including any amendments or supplements thereto) and the Supplemental Material,
including, without limitation, expenses associated with the production of slides
and graphics, fees and expenses of any consultants engaged in connection with
presentations with the prior approval of the Company and travel and lodging
expenses of the representatives of the Company and any such consultants, (ii)
filing fees, Company counsel's fees and expenses paid and incurred in connection
with the registration and qualification of the Shares for offer and sale by
Dealer Manager and Participating Brokers under the Act and the securities or
Blue Sky laws of the states in which offers are to be made, and (iii) filing
fees, Company counsel's fees and expenses paid and incurred in connection with
the review by FINRA of the underwriting terms of the offering of the Shares, and
(iv) the fees and expenses of any registrar or transfer agent in connection with
the Shares.

(b)           The Company will advise Dealer Manager and Participating Brokers
promptly of the issuance of any stop order withdrawing the qualification for the
offer and sale of the Shares or of the institution of any proceedings for that
purpose, and will use its best efforts to prevent the issuance of any such stop
order and to obtain as soon as possible the lifting thereof, if issued.

(c)           If at any time when a Prospectus relating to the Shares is
required to be delivered under the Act any event shall have occurred as a result
of which, in the opinion of counsel for the Company, the Prospectus as amended
or supplemented includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend the Prospectus
to comply with the Act, the Company promptly will prepare and file with the SEC
an appropriate amendment or supplement.

(d)           The Company will deliver to Dealer Manager and Participating
Brokers from time to time without charge as many copies of the Prospectus (and,
in the event of an amendment or supplement to the Prospectus pursuant to the
provisions of this Agreement, of such amended or supplemented Prospectus) and
the Supplemental Material as Dealer Manager or Participating Brokers may
reasonably request, which Prospectus(es), as from time to time amended or
supplemented, and Supplemental Material the Company authorizes Dealer Manager
and Participating Brokers to use in connection with the sale of the Shares.

 
 

--------------------------------------------------------------------------------

 

(e)           The Company will use its best efforts to register and qualify the
Shares for sale under the laws of those states and other jurisdictions where it
is intended that offers and sales will be made and will comply to the best of
its ability with the laws of those states so as to permit the continuance of
sales of the Shares thereunder. The Company covenants and agrees that neither
the Company, nor any officer, manager or employee of either of them will make
any offer or sale of the Shares unless such offer or sale is made in compliance
with the Act and the rules and regulations promulgated thereunder.

(f)            The Company will comply with all requirements imposed upon it by
the Securities Act and the Exchange Act, by the rules and regulations of the SEC
promulgated thereunder and by all securities laws and regulations of those
states in which an exemption has been obtained or qualification of the Shares
has been effected, to permit the continuance of offers and sales of the Shares
in accordance with the provisions hereof and of the Prospectus.

(g)           The Company agrees to do or cause to be done all such filing,
recording, publishing and other acts as may be appropriate to comply with the
requirements of law for the operation of a foreign corporation in all
jurisdictions, other than Maryland, where the Company shall desire to conduct
business or own properties as the case may be.

7.
Covenants of Dealer Manager

(a)           Dealer Manager covenants and agrees to comply, and to use
commercially reasonable efforts to cause the Participating Brokers to comply,
with any applicable requirements of the Act, and of the Exchange Act, and the
rules and regulations promulgated thereunder, all applicable state securities
laws and regulations as from time to time in effect, any other state and federal
laws and regulations applicable to the offering, the sale of Shares or the
activities of the Dealer Manager pursuant to this Agreement, including without
limitation the privacy standards and requirements of the Gramm-Leach-Bliley Act
of 1999, the requirements of any applicable state privacy laws and the
applicable provisions of the USA Patriot Act of 2001, this Agreement and the
Prospectus as amended and supplemented and the FINRA rules and, in particular,
the conduct rules which require Dealer Manager (i) to recommend the purchase of
Shares only when Dealer Manager has reasonable grounds to believe, on the basis
of information obtained from the investor concerning his investment objectives,
other investments, financial situation and needs, and any other information
known by the Dealer Manager, that the investor is or will be in a financial
position appropriate to enable him to realize to a significant extent the
benefits described in the prospectus, that the investor has a fair market net
worth sufficient to sustain the risks inherent in the program, including loss of
investment and lack of liquidity, and that the program is otherwise suitable for
the investor, (ii) to maintain or require to be maintained certain files
concerning the basis for Dealer Manager's determination of the suitability of
the investor, (iii) to have reasonable grounds to believe, based on information
made available to the Dealer Manager by the Company, that all material facts are
adequately and accurately disclosed and that such disclosed facts provide a
basis for evaluating an investment in the Company, and (iv) to inform the
prospective investor or require the prospective investor to be informed of all
pertinent facts relating to the liquidity and marketability of the investment
during the term of the investment. Dealer Manager also agrees not to deliver the
Supplemental Material to any person unless the Supplemental Material is
accompanied or preceded by the Prospectus. The Dealer Manager will permit a
Participating Broker to participate in the offering only if such Participating
Broker is a member of FINRA and will reallow commissions only to such FINRA
members.

(b)           Dealer Manager will not, and will require in its agreements with
Participating Brokers that such Participating Brokers not, give any information
or make any representation in connection with the offering of the Shares other
than those contained in the Prospectus and Supplemental Material furnished by
the Company, publish, circulate or otherwise use any other advertisement or
solicitation material in connection with the Offering. Dealer Manager is not
authorized to act as agent of the Company in any transaction, and Dealer Manager
agrees not to act as such agent and not to purport to do so without the prior
written approval of the Company. Dealer Manager agrees that if and when the
Company supplies Dealer Manager with copies of any supplement to the Prospectus,
Dealer Manager will thereafter distribute Prospectuses with such supplement.
Dealer Manager further agrees to comply with all instructions from the Company
concerning the destruction of out-dated Prospectuses and the use of supplemented
or amended Prospectuses.

 
 

--------------------------------------------------------------------------------

 

(c)           Dealer Manager agrees to solicit purchases of Shares only in the
States and other jurisdictions in which the Company indicates that such
solicitation can be made and in which Dealer Manager has determined that such
solicitation can be made by Dealer Manager and in which Dealer Manager is
qualified to so act.

(d)           Dealer Manager will not sell the Shares pursuant to this Agreement
unless the Prospectus is furnished to the purchaser at least five (5) business
days prior to the execution of the Subscription Agreement, or is sent to such
person under circumstances that it would be received by the purchaser five (5)
business days prior to his execution of the Subscription Agreement.

(e)           Dealer Manager will use reasonable efforts to select, and will
require in its agreements with Participating Brokers that such Participating
Brokers use reasonable efforts to select, investors who Dealer Manager
reasonably believes meet the investor suitability requirements which are set
forth in the Prospectus and Subscription Agreement (Appendix A to the
Prospectus) and such additional individual state requirements as are specified
in the Subscription Agreement and which are confirmed by the investors by
payment of the purchase price for the Shares including that each investor be of
legal age in the state of his or her residence. Dealer Manager will maintain,
for a period of six years, in Dealer Manager's files a copy of the Subscription
Agreement for each investor for whom Dealer Manager acts as Dealer Manager.

(f)            To the extent that information is provided to Dealer Manager
marked “For Broker-Dealer Use Only,” Dealer Manager covenants and agrees not to
provide such information to prospective investors.

(g)           The Dealer Manager will provide the Company with such information
relating to the offer and sale of the Shares by it as the Company may from time
to time reasonably request or as may be requested to enable the Company to
prepare such reports of sale as may be required to be filed under applicable
federal or state securities laws.

8.
Indemnification

(a)           Subject to the limitations below, the Company will indemnify and
hold harmless the Participating Brokers and (to the extent permitted by the
Company's charter) the Dealer Manager, their officers and directors and each
person, if any, who controls such Participating Broker or Dealer Manager within
the meaning of Section 15 of the Securities Act (the “Indemnified Persons”) from
and against any losses, claims, damages or liabilities (“Losses”), joint or
several, to which such Indemnified Persons may become subject, under the
Securities Act, the Exchange Act or otherwise, insofar as such Losses (or
actions in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of a material fact contained (A) in the
Registration Statement, the Prospectus, any Preliminary Prospectus used prior to
the effective date of the Registration Statement or any post-effective amendment
or supplement to any of them, (B) in any blue sky application or other document
executed by the Company or on its behalf specifically for the purpose of
qualifying any or all of the Shares for sale under the securities laws of any
jurisdiction or based upon written information furnished by the Company under
the securities laws thereof (any such application, document or information being
hereinafter called a “Blue Sky Application”), or (C) any Supplemental Material,
or (ii) the omission or alleged omission to state in the Registration Statement,
the Prospectus, any Preliminary Prospectus used prior to the effective date of
the Registration Statement or any post-effective amendment or supplement to any
of them or in any Blue Sky Application or Supplemental Material a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The Company will reimburse each Indemnified Person for any legal or
other expenses reasonably incurred by such Indemnified Person, in connection
with investigating or defending such Loss upon final disposition of the
proceeding giving rise to such Loss; provided that the Company will not be
liable in any such case to the extent that any such Loss or expense arises out
of or is based upon an untrue statement or alleged untrue statement or omission
or alleged omission made in reliance upon and in conformity with written
information furnished (x) to the Company by the Dealer Manager or (y) to the
Company or the Dealer Manager by or on behalf of any Participating Broker
specifically for use in the preparation of the Registration Statement or any
such post-effective amendment thereto, any such Blue Sky Application or any such
Preliminary Prospectus or the Prospectus, and, further, the Company will not be
liable in any such case if it is  determined that such Participating Broker or
the Dealer Manager was at fault in connection with the Loss, expense or action.

(b)           Notwithstanding the foregoing, the Company shall not provide for
indemnification of any Indemnified Persons for any liability or loss suffered by
any such Indemnified Person, unless all of the following conditions are met: (i)
the directors of the Company or the Advisor or its affiliates have determined,
in good faith, that the course of conduct that caused the loss or liability was
in the best interests of the Company; (ii) the Indemnified Persons were acting
on behalf of or performing services for the Company; (iii) such liability or
loss was not the result of negligence or misconduct by the Indemnified Persons;
and (iv) such indemnification or agreement to hold harmless is recoverable only
out of the Company's Net Asset Value (as defined in the Company's charter) and
not from its stockholders.

 
 

--------------------------------------------------------------------------------

 

(c)           In addition, the Company shall not indemnify or hold harmless an
Indemnified Person for any Losses 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 Indemnified Person, (ii) such claims have been
dismissed with prejudice on the merits by a court of competent jurisdiction as
to the particular Indemnified Person and (iii) a court of competent jurisdiction
approves a settlement of the claims against a particular Indemnified Person 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.

(d)           The Dealer Manager will indemnify and hold harmless the Company,
each director and officer of the Company (including any person named in the
Registration Statement, with his consent, as about to become a director), each
other person who has signed the Registration Statement and each person, if any,
who controls the Company within the meaning of Section 15 of the Securities Act
(each a “Dealer Manager Indemnified Person”), from and against any Losses to
which any of the Company Indemnitees may become subject, under the Securities
Act or otherwise, insofar as such Losses (or actions in respect thereof) arise
out of or are based upon (i) any untrue statement or alleged untrue statement of
a material fact contained (A) in the Registration Statement, the Prospectus, any
Preliminary Prospectus used prior to the effective date of the Registration
Statement or any post-effective amendment or supplement to any of them, (B) in
any Blue Sky Application, or (C) any Supplemental Material, or (ii) the omission
or alleged omission to state in the Registration Statement, the Prospectus, any
Preliminary Prospectus used prior to the effective date of the Registration
Statement or any post-effective amendment or supplement to any of them or in any
Blue Sky Application or Supplemental Material a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, in the case of
each of clauses (i) and (ii) to the extent, but only to the extent, that such
untrue statement or omission was made in reliance upon and in conformity with
written information furnished to the Company by or on behalf of the Dealer
Manager specifically for use with reference to the Dealer Manager in the
preparation of Registration Statement, the Prospectus, any Preliminary
Prospectus used prior to the effective date of the Registration Statement or any
post-effective amendment or supplement to any of them or any such Blue Sky
Application or Supplemental Material, (iii) any unauthorized use of sales
materials, use of unauthorized verbal representations or use of “For
Broker-Dealer Use Only” materials with members of the public concerning the
Shares by the Dealer Manager; (iv) any untrue statement made by the Dealer
Manager or its representatives or agents or omission to state a fact necessary
in order to make the statements made, in light of the circumstances under which
they were made, not misleading in connection with the offer and sale of the
Shares (v) any material violation of this Agreement; (vi) any failure to comply
with applicable laws governing money laundering abatement and anti-terrorism
financing efforts, including applicable FINRA rules, SEC rules and the USA
PATRIOT Act of 2001; or (vii) any other failure to comply with applicable FINRA
or SEC rules. The Dealer Manager will reimburse each Dealer Manager Indemnified
Person for any legal or other expenses reasonably incurred by them in connection
with investigating or defending such Loss, expense or action. This indemnity
agreement will be in addition to any liability that the Dealer Manager may
otherwise have.

(e)           Each Participating Broker severally will indemnify and hold
harmless the Company, the Dealer Manager, each of their officers and directors
(including any person named in the Registration Statement, with his consent, as
about to become a director), each other person who has signed the Registration
Statement and each person, if any, who controls the Company and the Dealer
Manager within the meaning of Section 15 of the Securities Act (each, a
“Participating Broker Indemnified Person”) from and against any Losses to which
a Participating Broker Indemnified Person may become subject, under the
Securities Act or otherwise, insofar as such Losses (or actions in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in the Registration Statement,
the Prospectus, any Preliminary Prospectus used prior to the effective date of
the Registration Statement or any post-effective amendment or supplement to any
of them, (B) in any Blue Sky Application, or (C) any Supplemental Material, or
(ii) the omission or alleged omission to state in the Registration Statement,
the Prospectus, any Preliminary Prospectus used prior to the effective date of
the Registration Statement or any post-effective amendment or supplement to any
of them or in any Blue Sky Application or Supplemental Material a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, in the case of each of clauses (i) and (ii) to the extent, but only
to the extent, that such untrue statement or omission was made in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of such Participating Broker specifically for use with reference to the
Participating Broker in the preparation of Registration Statement, the
Prospectus, any Preliminary Prospectus used prior to the effective date of the
Registration Statement or any post-effective amendment or supplement to any of
them or any such Blue Sky Application or Supplemental Material, (iii) any
unauthorized use of sales materials, use of unauthorized verbal representations
or use of “For Broker-Dealer Use Only” materials with members of the public
concerning the Shares by the Dealer Manager; (iv) any untrue statement made by
such Participating Broker or its representatives or agents or omission to state
a fact necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading in connection with the
offer and sale of the Shares (v) any material violation of this Agreement; (vi)
any failure to comply with applicable laws governing money laundering abatement
and anti-terrorism financing efforts, including applicable FINRA rules, SEC
rules and the USA PATRIOT Act of 2001; or (vii) any other failure to comply with
applicable FINRA or SEC rules. Each such Participating Broker will reimburse
each Participating Broker Indemnified Person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such Loss, expense or action. This indemnity agreement will be in addition to
any liability that such Participating Broker may otherwise have.

 
 

--------------------------------------------------------------------------------

 

(f)            Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against any indemnifying party under this
Section 8, notify in writing the indemnifying party of the commencement thereof.
The failure of an indemnified party so to notify the indemnifying party will
relieve the indemnifying party from any liability under this Section 8 as to the
particular item for which indemnification is then being sought, but not from any
other liability that it may have to any indemnified party. In case any such
action is brought against any indemnified party, and it notifies an indemnifying
party of the commencement thereof, the indemnifying party will be entitled, to
the extent it may wish, jointly with any other indemnifying party similarly
notified, to participate in the defense thereof, with separate counsel. Such
participation shall not relieve such indemnifying party of the obligation to
reimburse the indemnified party for reasonable legal and other expenses (subject
to Section 8(e) incurred by such indemnified party in defending itself, except
for such expenses incurred after the indemnifying party has deposited funds
sufficient to effect the settlement, with prejudice, of the claim in respect of
which indemnity is sought. Any such indemnifying party shall not be liable to
any such indemnified party on account of any settlement of any claim or action
effected without the consent of such indemnifying party. Any indemnified party
shall not be bound to perform or refrain from performing any act pursuant to the
terms of any settlement of any claim or action effected without the consent of
such indemnified party.

(g)           The indemnifying party shall pay all legal fees and expenses of
the indemnified party in the defense of such claims or actions; provided,
however, that the indemnifying party shall not be obliged to pay legal expenses
and fees to more than one law firm in connection with the defense of similar
claims arising out of the same alleged acts or omissions giving rise to such
claims notwithstanding that such actions or claims are alleged or brought by one
or more parties against more than one indemnified party. If such claims or
actions are alleged or brought against more than one indemnified party, then the
indemnifying party shall only be obliged to reimburse the expenses and fees of
the one law firm that has been selected by a majority of the indemnified parties
against which such action is finally brought; and in the event a majority of
such indemnified parties is unable to agree on which law firm for which expenses
or fees will be reimbursable by the indemnifying party, then payment shall be
made to the first law firm of record representing an indemnified party against
the action or claim. Such law firm shall be paid only to the extent of services
performed by such law firm and no reimbursement shall be payable to such law
firm on account of legal services performed by another law firm.

9.
Effective Date and Termination

Provided that at least one counterpart of this Agreement shall then have been
executed and delivered, this Agreement shall become effective at 12:00 noon,
California time, of the first full business day following the effective date of
the Registration Statement or at such later time after the Registration
Statement becomes effective as the Company shall first release the Shares for
sale to the public. For the purpose of this section the Shares shall be deemed
to have been released for sale to the public upon release by the Company of
correspondence or other notification to Dealer Manager indicating the
effectiveness of the Registration Statement, whichever shall first occur.

 
 

--------------------------------------------------------------------------------

 

This Agreement may be terminated by either party, at such party’s option, by
giving notice to the other party. In any case, this Agreement will terminate at
the close of business on the Offering Termination Date; provided, however, that
all accrued fees, commissions and out-of-pocket accountable expenses payable to
Dealer Manager under the terms and conditions hereof shall be paid when due
although this Agreement shall have theretofore been terminated.

Except as otherwise provided in Section 8, any termination of this Agreement
pursuant to this Section 9 shall be without liability of the Company to Dealer
Manager and without liability on Dealer Manager's part to the Company.

10.
Survival of Indemnities, Warranties and Representations

The indemnity agreements contained in Section 8 hereof, and the representations
and warranties of the Company set forth in Section l hereof, shall remain
operative and in full force and effect, regardless of any termination or
cancellation of this Agreement or any investigation made by or on behalf of the
Company, the Dealer Manager or any controlling person referred to in Section 8,
and shall survive the delivery of and payment for the Shares, and any successor
of Dealer Manager or the Company or of any such controlling person or any legal
representative of any such controlling person, as the case may be, shall be
entitled to the benefit of the respective indemnity agreements and
representations and warranties.

11.
Notices

Except as in this Agreement otherwise provided, (a) whenever notice is required
by the provisions of this Agreement or otherwise to be given to the Company,
such notice shall be in writing addressed to the Company at 1920 Main Plaza,
Suite 400 Irvine, California 92614, Attention: Terry G. Roussel, and (b)
whenever notice is required by the provisions of this Agreement or otherwise to
be given to Dealer Manager, such notice shall be in writing addressed to Dealer
Manager at 1290 Main Plaza, Suite 400 Irvine, California 92614. Any notice
referred to herein may be given in writing or by facsimile or telephone and if
by facsimile or telephone shall be immediately confirmed in writing. Notice
(unless actual) shall be effective upon mailing or facsimile transmission with
confirmation of receipt, as the case may be.

12.
Counterparts

This agreement may be executed in any number of counterparts.  Each counterpart,
when executed and delivered, shall be an original contract, but all
counterparts, when taken together, shall constitute one and the same agreement.

13.
Persons Entitled To Benefit of Agreement

Except as provided in the next sentence, this Agreement is made solely for the
benefit of Dealer Manager, Participating Brokers, the Company or controlling
persons thereof, and their respective successors and assigns, and no other
person shall acquire or have any right by virtue of this Agreement, and the term
“successors and assigns,” as used in this Agreement, shall not include any
purchaser, as such purchaser, of any of the Shares.

14.
Not a Separate Entity

Nothing contained herein shall constitute the Dealer Manager and Participating
Brokers, or any of them, as an association, partnership, unincorporated business
or other separate entity.

 
 

--------------------------------------------------------------------------------

 

Please confirm your agreement to become Dealer Manager under the terms and
conditions herein set forth by signing and returning the enclosed duplicate copy
of this Agreement at once to the Company at the address specified in Section 11
above.

 
Very truly yours,
           
CORNERSTONE CORE PROPERTIES REIT, INC.,
   
a Maryland corporation
           
By:
/s/ Terry G. Roussel
   
Terry G. Roussel, President
 

 
AGREED AND ACCEPTED:
       
PACIFIC CORNERSTONE CAPITAL, INC.,
 
a California corporation
       
By: 
/s/ Terry G. Roussel
   
Terry G. Roussel, President
       
Dated: 
June 10                          , 2009
 

 
 

--------------------------------------------------------------------------------

 

ATTACHMENT 1

TO DEALER MANAGER AGREEMENT

CORNERSTONE CORE PROPERTIES REIT, INC.

FORM OF PARTICIPATING BROKER AGREEMENT

Up to 77,350,000 Shares of Common Stock

Ladies and Gentlemen:

Cornerstone Core Properties REIT, Inc., a Maryland corporation (the “Company”),
is registering for public sale a maximum of 77,350,000 shares of its common
stock, $0.001 par value per share, (the “Shares”), to be issued and sold for an
aggregate maximum purchase price of $610,360,000 (56,250,000 Shares to be
offered to the public in a primary offering with an aggregate maximum purchase
price of $450,000,000 (the “Primary Offering”) and 21,100,000 Shares to be
offered pursuant to the Company's distribution reinvestment plan with an
aggregate maximum purchase price of $160,360,000 (“DRP”)). The Shares are to be
sold to selected persons or entities acceptable to the Company, upon the terms
and subject to the conditions set forth in the enclosed Prospectus.

Pacific Cornerstone Capital, Incorporated, a California corporation (the “Dealer
Manager”), has entered into a dealer manager agreement (“Dealer Manager
Agreement”) with the Company pursuant to which it has agreed to act as dealer
manager in connection with the offer and sale of the Shares. The Dealer Manager
has agreed to use commercially reasonable efforts to find purchasers of Shares
both directly and indirectly through a selling group consisting of participating
brokers (“Participating Brokers”).

The Dealer Manager hereby invites you to become a Participating Broker in
connection with the offer and sale of the Shares. By your acceptance hereof, you
agree to act in such capacity and to use your best efforts to find purchasers
for the Shares in accordance with the terms of the Prospectus and this
Agreement.

Accompanying this Agreement is a copy of the Prospectus. We may also provide you
with written, audio or audio-visual material, including an investment summary,
audio tape, video tape and internet site  prepared by the Company for use in
conjunction with the offer and sale of the Shares (“Supplemental Material”). You
are not authorized to use any solicitation material other than the Prospectus
and Supplemental Material referred to in this paragraph, which material has been
furnished by the Company.

Except as described in the Prospectus or in Section 3(c) hereof, the Shares are
to be sold for a per Share cash price as follows:

   
Primary Offering
   
DRP Offering
 
Regular Commission
  $ 8.00     $ 7.60  
Deferred Commission Option*
  $ 7.52     $ 7.60  

* For a period of six years following the date of purchase, an additional $0.10
per share will be deducted annually from cash distributions otherwise payable to
the purchaser and will be used to pay deferred commissions.

1.
Sale of the Shares.

(a)           A subscription agreement (“Subscription Agreement”) must be
completed by each person desiring to purchase Shares, or, at your option, by you
on behalf of each such person, and returned by you together with any other
documents that may be required under state securities laws or by the Company, to
Cornerstone Core Properties REIT, Inc., c/o Phoenix American Financial Services,
Inc., 2401 Kerner Boulevard, San Rafael, CA 94901. You shall ascertain that the
Subscription Agreement has been properly completed in full and signed by the
prospective purchaser prior to its return.

(b)           All subscription checks shall be made payable to the order of
CORNERSTONE CORE PROPERTIES REIT, INC. If you receive a check not conforming to
the foregoing instructions, you must return such check directly to the
subscriber not later than the end of the next business day following its
receipt. Checks conforming to the foregoing instructions shall be transmitted by
you for deposit directly to Cornerstone Core Properties REIT, Inc., c/o Phoenix
American Financial Services, Inc., 2401 Kerner Boulevard, San Rafael, CA 94901
by the end of the next business day following receipt by you. In the event your
final internal supervisory review is conducted at a different location, then
checks must be transmitted to your final review office by the end of the next
business day following receipt by you and your final review office must in turn,
by the end of the next business day following receipt by it, transmit the check
for deposit directly to Cornerstone Core Properties REIT, Inc., c/o Phoenix
American Financial Services, Inc., 2401 Kerner Boulevard, San Rafael, CA 94901.

 
 

--------------------------------------------------------------------------------

 

(c)           Upon receipt of the Subscription Agreement, the Company, will
determine promptly (and in any event within thirty (30) days after such receipt)
whether it wishes to accept the proposed purchaser as a member in the Company,
it being understood that the Company reserves the right to reject the tender of
any Subscription Agreement, in each case in its sole discretion. Should the
Company determine to accept the tender of the Subscription Agreement, the
Company will promptly advise you of such action. Should the Company determine to
reject the tender, it will promptly notify in writing the prospective purchaser
and you of such determination and will promptly return the tendered Subscription
Agreement and the purchase price of the Shares directly to the prospective
purchaser.

(d)           You will use all reasonable efforts to offer Shares only to
persons who meet the financial qualifications set forth in the Prospectus or in
any suitability letter or memorandum sent to you by the Company and you will
only make offers to persons in the states in which it is advised in writing that
the Shares are qualified for sale or that such qualification is not required. In
offering Shares, you will comply with the provisions of all applicable rules and
regulations relating to suitability of investors, including without limitation,
the provisions of Article III.C. of the Statement of Policy Regarding Real
Estate Investment Trusts of the North American Securities Administrators
Association, Inc. (the “NASAA Guidelines”). Nothing contained in this Section 1
shall be construed to impose upon the Company the responsibility of assuring
that prospective purchasers meet the suitability standards contained in the
Prospectus and the Subscription Agreement or to relieve you of the
responsibility of complying with the rules of the Financial Industry Regulatory
Authority (“FINRA”).  For purposes of this Agreement, references to “FINRA
rules,” “rules of FINRA” or similar variations, shall include, unless otherwise
expressly stated or context otherwise requires, NASD and FINRA rules currently
in effect and any successor or subsequent rules adopted by FINRA as part of its
consolidated rulebook or otherwise.

2.
Offering Termination Date.

As used herein, the term “Offering Termination Date” shall mean the earliest to
occur of (i) the date upon which subscriptions for the maximum number of Shares
offered have been accepted by the Company which date the Company shall designate
by notice to the Dealer Manager in writing; or (ii) June 10, 2011; provided,
however, that the Company may, by providing notice to Dealer Manager in writing,
extend the Offering Termination Date for an additional period of up to one year,
in which case the Offering Termination Date shall mean the date as set forth in
such notice. The Company may terminate the offering of Shares at any time for
any reason by written notice to the Dealer Manager at least two (2) business
days prior to the date of termination.

3.
Obligations and Compensation of Participating Broker.

(a)           The Dealer Manager hereby appoints you as a distributor during the
Offering Period (as defined in Section 3(b) for the purpose of finding, on a
best efforts basis, purchasers for the Shares for cash. You hereby accept such
agency and distributorship and agree to use your best efforts to find purchasers
for the Shares on said terms and conditions, commencing as soon as practicable.

(b)           The “Offering Period” shall mean that period during which Shares
may be offered for sale, commencing on the date the registration was made
effective by the SEC, during which period offers and sales of the Shares shall
occur continuously in the jurisdictions in which the Shares are registered or
qualified or exempt from registration (as confirmed in writing by the Company to
the Dealer Manager) unless and until the Offering is terminated as provided
herein, except that you shall suspend or terminate offering of the Shares upon
request of the Company or the Dealer Manager at any time and shall resume
offering the Shares upon subsequent request of the Company or the Dealer
Manager. The Offering Period shall in all events terminate upon the sale of all
of the Shares. Upon termination of the Offering Period, your agency and this
Agreement shall terminate without obligation on your part or the part of the
Dealer Manager or the Company except as set forth in this Agreement.

 
 

--------------------------------------------------------------------------------

 

(c)           Except as may be provided in the “Plan of Distribution” section of
the Prospectus, as compensation for the services rendered by you, the Dealer
Manager agrees that it will pay to you selling commissions as follows (based on
a selling price of $8.00 per Share):

Selling Commissions
 
Primary Offering
 
DRP Offering
 
7%
    0 %

If you and the investor agree, the selling commissions can be paid on a deferred
basis for Shares sold in the primary offering. In these instances, the Company
will sell the Shares at a reduced price as set forth above and the Dealer
Manager will pay you a correspondingly reduced sales commission at the time of
sale. The balance of the normal commission would be paid by the Company to the
Dealer Manager and by the Dealer Manager to you over six years for Shares sold
in the primary offering out of the dividends or other distributions that are
declared and paid with respect to the reduced-priced shares sold through you.
The amount by which by the investor’s dividends or other distributions are
reduced in these cases would be paid by the Company as deferred commissions to
the Dealer Manager and by the Dealer Manager to you.

As an example, investors electing the deferred commission option for Shares
purchased in the primary offering will pay, on the date of purchase, $7.52 per
Share (which includes a commission of $0.08 per Share). For a period of six
years following the date of purchase, an additional $0.08 per Share will be
deducted annually from dividends or other cash distributions otherwise payable
to the investor and will be used to pay deferred commissions. The net proceeds
to the Company will not be affected by the election of the deferred commission
option. Under this arrangement, an investor electing the deferred commission
option will pay a 1% commission upon subscription, rather than a 7% commission,
and an amount equal to a 1% commission per year thereafter for the next six
years, or longer if required to satisfy outstanding deferred commission
obligations, will be deducted from dividends or other cash distributions
otherwise payable to such stockholder. The Company may also use other deferred
commission structures, but the Company will not pay total commissions in excess
of 7% of the offering price of the Shares.

If at any time prior to the satisfaction of the Company’s remaining deferred
commission obligations, the Company decides to list its common stock for trading
on national securities exchange, the Nasdaq Global Market or other
over-the-counter market, or the Company begins a liquidation of its properties,
the Company may accelerate the remaining commissions due under the deferred
commission option. To the extent that the distributions prior to listing are
insufficient to satisfy the remaining commissions due, the obligations of the
Company and the investor to pay any further deferred commissions will terminate,
and the Dealer Manager and you will not be entitled to receive any further
portion of their deferred commissions following listing of the Company’s common
stock.

In addition, if an investor that has elected the deferred commission option
decides to participate in the Company’s share redemption program or requests
that the Company transfer such stockholder’s Shares for any reason prior to the
time that the remaining deferred selling commissions have been deducted from
such stockholder’s cash distributions, the Company will accelerate the selling
commissions due under the Deferred Commission Option as set forth in the
Prospectus.

4.
Representations and Warranties of Participating Broker.

You represent and warrant to and covenant to the Dealer Manager and the Company
that:

(a)           You are a member of FINRA in good standing and a broker-dealer
registered as such under the Exchange Act and under the securities laws of the
states in which the Shares are to be offered and sold. You and your employees
and representatives have all required licenses and registrations to act under
this Agreement.

(b)           You have full legal right, power and authority to enter into this
Agreement and to perform the transactions contemplated hereby, and you have duly
authorized, executed and delivered this Agreement.

(c)           This Agreement is a valid, legal, and binding agreement of yours
enforceable in accordance with its terms, except to the extent that the
enforceability of the indemnity provisions contained in Section 6 hereof may be
limited under applicable securities laws and to the extent that the
enforceability of this Agreement may be limited by bankruptcy, insolvency or
similar laws affecting the rights of creditors generally.

 
 

--------------------------------------------------------------------------------

 

(d)           The execution and delivery of this Agreement, the consummation of
the transactions herein contemplated and the compliance with the terms of this
Agreement by you will not conflict with or constitute a default or violation
under any charter, by-law, contract, indenture, mortgage, deed of trust, lease,
rule, regulation, writ, injunction or decree of any government, governmental
instrumentality or court, domestic or foreign, having jurisdiction over you.

(e)           No consent, approval, authorization or other order of any
governmental authority is required in connection with the execution, delivery or
performance by you of this Agreement.

(f)           You have not violated any of the “bad boy” disqualification
provisions contained in the securities or “blue sky” laws of any jurisdiction in
which the Shares may be offered.

5.
Covenants of Participating Broker

(a)           You will not make any written or oral statement with respect to
the Company or the offering of Shares that is materially inconsistent with the
statements in the Prospectus or Supplemental Material.

(b)           You will provide the Dealer Manager with such information relating
to the offer and sale of the Shares as the Dealer Manager may from time to time
reasonably request or as may be requested to enable the Dealer Manager or the
Company, as the case may be, to prepare such reports of sale as may be required
to be filed under applicable federal or state securities laws and the rules and
regulations thereunder.

(c)           You will cease making offers and soliciting subscriptions for
Shares if so requested by the Dealer Manager in order to comply with applicable
federal and state securities laws, and will forward to offerees for execution
and delivery such additional documents and instruments as the Dealer Manager may
reasonably require.

(d)           You will: (i) maintain all representation letters, questionnaires
and other materials utilized by you to ascertain the satisfaction of the above
criteria by offerees and investors, for a period of at least six years from the
date of the offering is completed; and (ii) make such material available to the
Dealer Manager upon its request.

(e)            Before, during or after the offering, except with the prior
written consent of the Dealer Manager and except for internal-use only purposes
or for the delivery to your advisors, will not duplicate any of the Supplemental
Material or other similar selling documentation furnished to you by the Dealer
Manager or the Company.

(f)            You have not paid or awarded, and will not pay or award, directly
or indirectly, any commission or other compensation to any person engaged to
render investment advice to a potential subscriber as an inducement to advise
the purchase of the Shares, except as such commissions or other compensation may
be paid or awarded to you or reallowed by you in connection with the sale of the
Shares as described in the Prospectus.

(g)           All training and education meetings held by you will be in
compliance with Rule 5110 (i)(2) of the FINRA rules.

(h)           All sales incentive and bonus programs designed by you for your
registered representatives will comply with all applicable FINRA rules.

(i)            You have established and will maintain a customer identification
program which requires you to (i) verify the identify of any person seeking to
purchase the Shares through you to the extent reasonable and practicable, (ii)
maintain records of the information used to verify the person’s identity and
(iii) determine whether the person appears on any lists of known or suspected
terrorists or terrorist organizations provided to brokers or dealers by any
government agency, in all accordance with the requirements of 31 C.F.R. Section
103.122.

(j)            You have established and will maintain an anti-money laundering
compliance program in accordance with applicable laws and regulations, including
the USA Patriot Act of 2001, and in accordance with NASD Rule 3011 (or successor
FINRA rule) and the related interpretive guidance described in NASD’s IM-3011-1
and IM-3011-2 (or successor FINRA interpretive guidance).

 
 

--------------------------------------------------------------------------------

 

(k)           You covenant and agree to comply with any applicable requirements
of the Act, and of the Exchange Act, and the published rules and regulations
promulgated thereunder, all applicable state securities laws and regulations as
from time to time in effect, any other state and federal laws and regulations
applicable to the offering, the sale of Shares or the activities of the
Participating Broker pursuant to this Agreement, including without limitation
the privacy standards and requirements of the Gramm-Leach-Bliley Act of 1999,
the requirements of any applicable state privacy laws and the applicable
provisions of the USA Patriot Act of 2001, this Agreement and the Prospectus as
amended and supplemented and the FINRA rules and, in particular, the rules which
require the Participating Broker (i) to recommend the purchase of Shares only
when the Participating Broker has reasonable grounds to believe, on the basis of
information obtained from the investor concerning his investment objectives,
other investments, financial situation and needs, and any other information
known by the Participating Broker, that the investor is or will be in a
financial position appropriate to enable him to realize to a significant extent
the benefits described in the prospectus, that the investor has a fair market
net worth sufficient to sustain the risks inherent in the program, including
loss of investment and lack of liquidity, and that the program is otherwise
suitable for the investor, (ii) to maintain certain files concerning the basis
for Participating Broker’s determination of the suitability of the investor,
(iii) to have reasonable grounds to believe, based on information made available
to the Participating Broker by the Company, that all material facts are
adequately and accurately disclosed and that such disclosed facts provide a
basis for evaluating an investment in the Company, and (iv) to inform the
prospective investor or require the prospective investor to be informed of all
pertinent facts relating to the liquidity and marketability of the investment
during the term of the investment. Participating Broker also agrees not to
deliver the Supplemental Material to any person unless the Supplemental Material
is accompanied or preceded by the Prospectus.

(l)            You will not give any information or make any representation in
connection with the offering of the Shares other than those contained in the
Prospectus and Supplemental Material furnished by the Company. You agree not to
publish, circulate or otherwise use any other advertisement or solicitation
material. You are not authorized to act as agent of the Company or the Dealer
Manager in any connection or transaction, and you agree not to act as such agent
and not to purport to do so without the prior written approval of the Company
and the Dealer Manager. You agree that if and when the Company or Dealer Manager
supplies Participating Broker with copies of any supplement to the Prospectus,
Participating Broker will thereafter distribute Prospectuses with such
supplement.. You further agree to comply with all instructions from the Company
or the Dealer Manager concerning the destruction of out-dated Prospectuses and
the use of supplemented or amended Prospectuses.

(m)           You agree to solicit purchases of Shares only in the States and
other jurisdictions in which the Company indicates that such solicitation can be
made and in which you have determined that such solicitation can be made by you
and in which you are is qualified to so act.

(n)           You will not sell the Shares pursuant to this Agreement unless the
Prospectus is furnished to the purchaser at least five (5) business days prior
to the execution of the Subscription Agreement, or is sent to such person under
circumstances that it would be received by the purchaser five (5) business days
prior to his execution of the Subscription Agreement.

(o)           You will use reasonable efforts to select investors who you
reasonably believe meet the investor suitability requirements which are set
forth in the Prospectus and Subscription Agreement (Appendix A to the
Prospectus) and such additional individual state requirements as are specified
in the Subscription Agreement and which are confirmed by the investors by
payment of the purchase price for the Shares including that each investor be of
legal age in the state of his or her residence. You will, for a period of six
years, maintain in your files a copy of the Subscription Agreement for each
investor for whom you acts as Participating Broker.

(p)           You agree to comply with the record-keeping requirements imposed
by (a) federal and state securities laws and the rules and regulations
promulgated thereunder, (b) the applicable rules of FINRA and (c) the NASAA
Guidelines, including the requirement to maintain records (the “Suitability
Records”) of the information used to determine that an investment in Shares is
suitable and appropriate for each subscriber for a period of six years from the
date of the sale of the Shares.   You further agree to make the Suitability
Records available to the Dealer Manager and the Company upon request and to make
them available to representatives of the SEC and FINRA and applicable state
securities administrators upon the Dealer’s receipt of a subpoena or other
appropriate document request from such agency.

(q)           To the extent that information is provided to you marked “For
Broker-Dealer Use Only,” you covenant and agree not to provide such information
to prospective investors.

 
 

--------------------------------------------------------------------------------

 

6.           Indemnification

(a)           Subject to the limitations below, the Company will indemnify and
hold harmless the Participating Brokers and (to the extent permitted by the
Company's charter) the Dealer Manager, their officers and directors and each
person, if any, who controls such Participating Broker or Dealer Manager within
the meaning of Section 15 of the Securities Act (the “Indemnified Persons”) from
and against any losses, claims, damages or liabilities (“Losses”), joint or
several, to which such Indemnified Persons may become subject, under the
Securities Act, the Exchange Act or otherwise, insofar as such Losses (or
actions in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of a material fact contained (A) in the
Registration Statement, the Prospectus, any Preliminary Prospectus used prior to
the effective date of the Registration Statement or any post-effective amendment
or supplement to any of them, (B) in any blue sky application or other document
executed by the Company or on its behalf specifically for the purpose of
qualifying any or all of the Shares for sale under the securities laws of any
jurisdiction or based upon written information furnished by the Company under
the securities laws thereof (any such application, document or information being
hereinafter called a “Blue Sky Application”), or (C) any Supplemental Material,
or (ii) the omission or alleged omission to state in the Registration Statement,
the Prospectus, any Preliminary Prospectus used prior to the effective date of
the Registration Statement or any post-effective amendment or supplement to any
of them or in any Blue Sky Application or Supplemental Material a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The Company will reimburse each Indemnified Person for any legal or
other expenses reasonably incurred by such Indemnified Person, in connection
with investigating or defending such Loss upon final disposition of the
proceeding giving rise to such Loss; provided that the Company will not be
liable in any such case to the extent that any such Loss or expense arises out
of or is based upon an untrue statement or alleged untrue statement or omission
or alleged omission made in reliance upon and in conformity with written
information furnished (x) to the Company by the Dealer Manager or (y) to the
Company or the Dealer Manager by or on behalf of any Participating Broker
specifically for use in the preparation of the Registration Statement or any
such post-effective amendment thereto, any such Blue Sky Application or any such
Preliminary Prospectus or the Prospectus, and, further, the Company will not be
liable in any such case if it is  determined that such Participating Broker or
the Dealer Manager was at fault in connection with the Loss, expense or action.

(b)           Notwithstanding the foregoing, the Company shall not provide for
indemnification of any Indemnified Persons for any liability or loss suffered by
any such Indemnified Person, unless all of the following conditions are met: (i)
the directors of the Company or the Advisor or its affiliates have determined,
in good faith, that the course of conduct that caused the loss or liability was
in the best interests of the Company; (ii) the Indemnified Persons were acting
on behalf of or performing services for the Company; (iii) such liability or
loss was not the result of negligence or misconduct by the Indemnified Persons;
and (iv) such indemnification or agreement to hold harmless is recoverable only
out of the Company's Net Asset Value (as defined in the Company's charter) and
not from its stockholders.

(c)           In addition, the Company shall not indemnify or hold harmless an
Indemnified Person for any Losses 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 Indemnified Person, (ii) such claims have been
dismissed with prejudice on the merits by a court of competent jurisdiction as
to the particular Indemnified Person and (iii) a court of competent jurisdiction
approves a settlement of the claims against a particular Indemnified Person 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.

(d)           The Dealer Manager has agreed to indemnify and hold harmless the
Company, each director and officer of the Company (including any person named in
the Registration Statement, with his consent, as about to become a director),
each other person who has signed the Registration Statement and each person, if
any, who controls the Company within the meaning of Section 15 of the Securities
Act (each a “Dealer Manager Indemnified Person”), from and against any Losses to
which any of the Company Indemnitees may become subject, under the Securities
Act or otherwise, insofar as such Losses (or actions in respect thereof) arise
out of or are based upon (i) any untrue statement or alleged untrue statement of
a material fact contained (A) in the Registration Statement, the Prospectus, any
Preliminary Prospectus used prior to the effective date of the Registration
Statement or any post-effective amendment or supplement to any of them, (B) in
any Blue Sky Application, or (C) any Supplemental Material, or (ii) the omission
or alleged omission to state in the Registration Statement, the Prospectus, any
Preliminary Prospectus used prior to the effective date of the Registration
Statement or any post-effective amendment or supplement to any of them or in any
Blue Sky Application or Supplemental Material a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, in the case of
each of clauses (i) and (ii) to the extent, but only to the extent, that such
untrue statement or omission was made in reliance upon and in conformity with
written information furnished to the Company by or on behalf of the Dealer
Manager specifically for use with reference to the Dealer Manager in the
preparation of Registration Statement, the Prospectus, any Preliminary
Prospectus used prior to the effective date of the Registration Statement or any
post-effective amendment or supplement to any of them or any such Blue Sky
Application or Supplemental Material, (iii) any unauthorized use of sales
materials, use of unauthorized verbal representations or use of “For
Broker-Dealer Use Only” materials with members of the public concerning the
Shares by the Dealer Manager; (iv) any untrue statement made by the Dealer
Manager or its representatives or agents or omission to state a fact necessary
in order to make the statements made, in light of the circumstances under which
they were made, not misleading in connection with the offer and sale of the
Shares (v) any material violation of this Agreement; (vi) any failure to comply
with applicable laws governing money laundering abatement and anti-terrorism
financing efforts, including applicable FINRA rules, SEC rules and the USA
PATRIOT Act of 2001; or (vii) any other failure to comply with applicable FINRA
or SEC rules. The Dealer Manager will reimburse each Dealer Manager Indemnified
Person for any legal or other expenses reasonably incurred by them in connection
with investigating or defending such Loss, expense or action. This indemnity
agreement will be in addition to any liability that the Dealer Manager may
otherwise have.

 
 

--------------------------------------------------------------------------------

 

(e)           You and each other Participating Broker severally will indemnify
and hold harmless the Company, the Dealer Manager, each of their officers and
directors (including any person named in the Registration Statement, with his
consent, as about to become a director), each other person who has signed the
Registration Statement and each person, if any, who controls the Company and the
Dealer Manager within the meaning of Section 15 of the Securities Act (each, a
“Participating Broker Indemnified Person”) from and against any Losses to which
a Participating Broker Indemnified Person may become subject, under the
Securities Act or otherwise, insofar as such Losses (or actions in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in the Registration Statement,
the Prospectus, any Preliminary Prospectus used prior to the effective date of
the Registration Statement or any post-effective amendment or supplement to any
of them, (B) in any Blue Sky Application, or (C) any Supplemental Material, or
(ii) the omission or alleged omission to state in the Registration Statement,
the Prospectus, any Preliminary Prospectus used prior to the effective date of
the Registration Statement or any post-effective amendment or supplement to any
of them or in any Blue Sky Application or Supplemental Material a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, in the case of each of clauses (i) and (ii) to the extent, but only
to the extent, that such untrue statement or omission was made in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of such Participating Broker specifically for use with reference to the
Participating Broker in the preparation of Registration Statement, the
Prospectus, any Preliminary Prospectus used prior to the effective date of the
Registration Statement or any post-effective amendment or supplement to any of
them or any such Blue Sky Application or Supplemental Material, (iii) any
unauthorized use of sales materials, use of unauthorized verbal representations
or use of “For Broker-Dealer Use Only” materials with members of the public
concerning the Shares by the Dealer Manager; (iv) any untrue statement made by
such Participating Broker or its representatives or agents or omission to state
a fact necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading in connection with the
offer and sale of the Shares (v) any material violation of this Agreement; (vi)
any failure to comply with applicable laws governing money laundering abatement
and anti-terrorism financing efforts, including applicable FINRA rules, SEC
rules and the USA PATRIOT Act of 2001; or (vii) any other failure to comply with
applicable FINRA or SEC rules. Each such Participating Broker will reimburse
each Participating Broker Indemnified Person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such Loss, expense or action. This indemnity agreement will be in addition to
any liability that such Participating Broker may otherwise have.

(f)            Promptly after receipt by an indemnified party under this Section
6 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against any indemnifying party under this
Section 6, notify in writing the indemnifying party of the commencement thereof.
The failure of an indemnified party so to notify the indemnifying party will
relieve the indemnifying party from any liability under this Section 6 as to the
particular item for which indemnification is then being sought, but not from any
other liability that it may have to any indemnified party. In case any such
action is brought against any indemnified party, and it notifies an indemnifying
party of the commencement thereof, the indemnifying party will be entitled, to
the extent it may wish, jointly with any other indemnifying party similarly
notified, to participate in the defense thereof, with separate counsel. Such
participation shall not relieve such indemnifying party of the obligation to
reimburse the indemnified party for reasonable legal and other expenses
(incurred by such indemnified party in defending itself, except for such
expenses incurred after the indemnifying party has deposited funds sufficient to
effect the settlement, with prejudice, of the claim in respect of which
indemnity is sought. Any such indemnifying party shall not be liable to any such
indemnified party on account of any settlement of any claim or action effected
without the consent of such indemnifying party. Any indemnified party shall not
be bound to perform or refrain from performing any act pursuant to the terms of
any settlement of any claim or action effected without the consent of such
indemnified party.

 
 

--------------------------------------------------------------------------------

 

(g)           The indemnifying party shall pay all legal fees and expenses of
the indemnified party in the defense of such claims or actions; provided,
however, that the indemnifying party shall not be obliged to pay legal expenses
and fees to more than one law firm in connection with the defense of similar
claims arising out of the same alleged acts or omissions giving rise to such
claims notwithstanding that such actions or claims are alleged or brought by one
or more parties against more than one indemnified party. If such claims or
actions are alleged or brought against more than one indemnified party, then the
indemnifying party shall only be obliged to reimburse the expenses and fees of
the one law firm that has been selected by a majority of the indemnified parties
against which such action is finally brought; and in the event a majority of
such indemnified parties is unable to agree on which law firm for which expenses
or fees will be reimbursable by the indemnifying party, then payment shall be
made to the first law firm of record representing an indemnified party against
the action or claim. Such law firm shall be paid only to the extent of services
performed by such law firm and no reimbursement shall be payable to such law
firm on account of legal services performed by another law firm.

7.
Effective Date and Termination.

This Agreement shall become effective upon its execution and delivery by the
Dealer Manager, the Company and you.  This Agreement may be terminated by you or
the Dealer Manager at your or its option by giving written notice to the other
and the Company. In any case, this Agreement will terminate at the close of
business on the Termination Date; provided, however, that all accrued fees
payable to you under the terms and conditions hereof shall be paid when due
although this Agreement shall have theretofore been terminated.

Except as otherwise provided in Section 8, any termination of this Agreement
pursuant to this Section 7 shall be without liability of Dealer Manager and the
Company to you and without liability on your part to the Dealer Manager or the
Company, except with respect to compensation earned for accepted subscriptions.

8.
Survival of Indemnities, Warranties and Representations.

Your indemnity agreements contained in Section 6 hereof, and the representations
and warranties of the Participating Broker set forth in Section 4 hereof, shall
remain operative and in full force and effect, regardless of any termination or
cancellation of this Agreement or any investigation made by or on behalf of you,
the Dealer Manager, the Company, or any controlling person thereof, and shall
survive the delivery of and payment for the Shares, and any successor of the
Company, the Dealer Manager or of any such controlling person or any legal
representative of any such controlling person, as the case may be, shall be
entitled to the benefit of your indemnity agreements and representations and
warranties.

9.
Notices.

Except as otherwise provided in this Agreement, (a) whenever notice is required
by the provisions of this Agreement or otherwise to be given to the Company,
such notice shall be in writing addressed to the Company at 1920 Main Street,
Suite 400, Irvine, California 92614, Attention: Terry G. Roussel, (b) whenever
notice is required by the provisions of this Agreement or otherwise to be given
to the Dealer Manager, such notice shall be in writing addressed to Dealer
Manager at 1920 Main Street, Suite 400, Irvine, California 92614, and (c)
whenever notice is required by the provisions of this Agreement or otherwise to
be given to you, at the address set forth on the last page of this Agreement.
Any notice referred to herein may be given in writing or by facsimile or
telephone and if by telephone shall be immediately confirmed in writing. Notice
(unless actual) shall be effective upon mailing or facsimile transmission with
confirmation of facsimile receipt, as the case may be.

 
 

--------------------------------------------------------------------------------

 

10.
Counterparts

This agreement may be executed in any number of counterparts.  Each counterpart,
when executed and delivered, shall be an original contract, but all
counterparts, when taken together, shall constitute one and the same agreement

11.
Persons Entitled To Benefit of Agreement.

Except as provided in the next sentence, this Agreement is made solely for the
benefit of you, the other Participating Brokers, the Dealer Manager, the Company
or controlling persons thereof, and their respective successors and assigns, and
no other person shall acquire or have any right by virtue of this Agreement, and
the term “successors and assigns,” as used in this Agreement, shall not include
any purchaser, as such purchaser, of any of the Shares.

12.
Not a Separate Entity.

Nothing contained herein shall constitute you, the Dealer Manager or the other
Participating Brokers, or any of them, as an association, partnership,
unincorporated business or other separate entity.

13.           Assignability

Neither the rights nor the obligations of the Dealer Manager or the
Participating Broker may be transferred or assigned, provided, however, that the
Dealer Manager may assign its rights and obligations under this Agreement to any
successor Dealer Manager under the Dealer Manager Agreement.  Any other
purported assignment of this Assignment or any of the rights and obligations
hereunder shall be null, void and of no effect.

 
 

--------------------------------------------------------------------------------

 

Please confirm your agreement to become a Participating Broker under the terms
and conditions herein set forth by signing and returning the enclosed duplicate
copy of this Agreement at once to the Dealer Manager at 1920 Main Street, Suite
400, Irvine, California 92614.

 
Very truly yours,
       
PACIFIC CORNERSTONE CAPITAL,
 
INCORPORATED, a California corporation
       
By:
           
Terry G. Roussel, President

AGREED AND ACCEPTED:
         
(Broker Dealer Name)
         
(Address)
         
(City, State  Zip)
 

 
By:
   

Print Name:
   

Title:
   

 
Dated___________, 2009
       
CORNERSTONE CORE PROPERTIES REIT, INC.
 
a Maryland corporation
 
By:
     
 
   
Terry G. Roussel, President
 

 
 

--------------------------------------------------------------------------------