Exhibit 10.1

 

SECOND AMENDED AND RESTATED

 

ADVISORY AGREEMENT

 

BY AND AMONG

 

HEALTHCARE TRUST, INC.,

 

HEALTHCARE TRUST OPERATING PARTNERSHIP, L.P.,

 

AND

 

HEALTHCARE TRUST ADVISORS, LLC

 

Dated as of February 17, 2017

 

 

 

   

 

TABLE OF CONTENTS

 

    Page       1. DEFINITIONS 1       2. APPOINTMENT 10       3. DUTIES OF THE
ADVISOR 11       4. AUTHORITY OF ADVISOR 13       5. FIDUCIARY RELATIONSHIP 14  
    6. NO PARTNERSHIP OR JOINT VENTURE 14       7. BANK ACCOUNTS 14       8.
RECORDS; ACCESS 14       9. LIMITATIONS ON ACTIVITIES 14       10. FEES 15      
11. EXPENSES 17       12. OTHER SERVICES 18       13. OTHER ACTIVITIES OF THE
ADVISOR 19       14. THE AMERICAN REALTY CAPITAL NAME 19       15. TERM OF
AGREEMENT 20       16. TERMINATION BY THE PARTIES 20       17. ASSIGNMENT 20    
  18. PAYMENTS TO AND DUTIES OF ADVISOR UPON TERMINATION 21       19.
INCORPORATION OF THE ARTICLES OF INCORPORATION AND THE OPERATING PARTNERSHIP
AGREEMENT 22       20. INDEMNIFICATION BY THE COMPANY AND THE OPERATING
PARTNERSHIP 22       21. INDEMNIFICATION BY ADVISOR 24

 

   

 

22. NOTICES 24       23. MODIFICATION 25       24. SEVERABILITY 25       25.
GOVERNING LAW 25       26. ENTIRE AGREEMENT 25       27. NO WAIVER 25       28.
PRONOUNS AND PLURALS 26       29. HEADINGS 26       30. EXECUTION IN
COUNTERPARTS 26

 

   

 

ADVISORY AGREEMENT

 

THIS SECOND AMENDED AND RESTATED ADVISORY AGREEMENT (this “Agreement”), dated as
of February 17, 2017, is entered into among Healthcare Trust, Inc., a Maryland
corporation (the “Company”), Healthcare Trust Operating Partnership, L.P., a
Delaware limited partnership (the “Operating Partnership”), and Healthcare Trust
Advisors, LLC, a Delaware limited liability company.

 

WITNESSETH

 

WHEREAS, the Company is a Maryland corporation created in accordance with the
Maryland General Corporation Law;

 

WHEREAS, the Company is the general partner of the Operating Partnership;

 

WHEREAS, the Company and the Operating Partnership desire to avail themselves of
the experience, sources of information, advice, assistance and certain
facilities of the Advisor and to have the Advisor undertake the duties and
responsibilities hereinafter set forth, on behalf of, and subject to the
supervision of, the Board of Directors of the Company, all as provided herein;

 

WHEREAS, the Advisor is willing to render such services, subject to the
supervision of the Board of Directors of the Company, on the terms and subject
to the conditions hereinafter set forth;

 

WHEREAS, the Company, the Operating Partnership and the Advisor (i) entered into
that certain Advisory Agreement, dated as of February 14, 2013 (as amended by
the First Amendment thereto, dated as of March 11, 2013, the Second Amendment
thereto, dated as of May 13, 2013, and the Third Amendment thereto, dated as of
May 12, 2015 the “Original Agreement”), and (ii) amended and restated the
Original Agreement on June 26, 2015 (as amended, modified or supplemented from
time to time, the “Amended and Restated Advisory Agreement”); and

 

WHEREAS, as of the date hereof (the “Effective Date”), the Company, the
Operating Partnership and the Advisor desire to amend and restate the Amended
and Restated Advisory Agreement in its entirety on the terms and subject to the
conditions hereinafter set forth.

 

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants
and agreements contained herein, the parties hereto, intending to be legally
bound as of the Effective Date, hereby agree as follows:

 

1.           DEFINITIONS. As used in this Agreement, the following terms have
the definitions set forth below:

 

“Acquisition Expenses” means any and all expenses incurred by the Company, the
Operating Partnership, the Advisor or any of their Affiliates in connection with
the selection, evaluation, acquisition, origination, making or development of
any

 

1 

 

Investments, whether or not acquired, including, without limitation, legal fees
and expenses, travel and communications expenses, brokerage fees, costs of
appraisals, nonrefundable option payments on property not acquired, accounting
fees and expenses, title insurance premiums and the costs of performing due
diligence.

 

“Adjusted Outstanding Shares” means, for the applicable period, the number of
shares of Common Stock, OP Units and other equity-based awards, excluding
restricted stock units or any other equity based awards that are subject to
performance metrics that are not currently achieved, outstanding on a daily
weighted average basis during such period, adjusted as necessary to exclude the
effect of dividends or distributions paid in shares of Common Stock, subdivision
of outstanding shares of Common Stock into a greater number of shares,
combination of outstanding shares of Common Stock into a smaller number of
shares, any reclassification of shares of Common Stock, repurchases by the
Company of shares of Common Stock and redemptions of shares of Common Stock.

 

“Advisor” means Healthcare Trust Advisors, LLC, a Delaware limited liability
company, any successor advisor to the Company and the Operating Partnership, or
any Person to which Healthcare Trust Advisors, LLC or any successor advisor
subcontracts substantially all of its functions. Notwithstanding the foregoing,
a Person hired or retained by Healthcare Trust Advisors, LLC to perform property
management and related services for the Company or the Operating Partnership
that is not hired or retained to perform substantially all of the functions of
Healthcare Trust Advisors, LLC with respect to the Company and the Operating
Partnership as a whole shall not be deemed to be an Advisor.

 

“Affiliate” or “Affiliated” means with respect to any Person, (i) any other
Person directly or indirectly owning, controlling or holding, with the power to
vote, ten percent (10%) or more of the outstanding voting securities of such
Person; (ii) any other Person ten percent (10%) or more of whose outstanding
voting securities are directly or indirectly owned, controlled or held, with the
power to vote, by such Person; (iii) any other Person directly or indirectly
controlling, controlled by or under common control with such Person; (iv) any
executive officer, director, trustee or general partner of such Person; and (v)
any legal entity for which such Person acts as an executive officer, director,
trustee or general partner. For purposes of this definition, the terms
“controls,” “is controlled by,” or “is under common control with” shall mean the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of an entity, whether through ownership or voting
rights, by contract or otherwise.

 

“Agreement” has the meaning set forth in the preamble, and such term shall
include any amendment or supplement hereto from time to time.

 

“Amended and Restated Advisory Agreement” has the meaning set forth in the
recitals.

 

“Articles of Incorporation” means the charter of the Company, as the same may be
amended from time to time.

 

2 

 

“Base Management Fee” means the fees payable to the Advisor or its assignees
pursuant to Section 10(c).

 

“Board of Directors” or “Board” means the Board of Directors of the Company.

 

“By-laws” means the by-laws of the Company, as amended and as the same are in
effect from time to time.

 

“Cause” means (i) fraud, criminal conduct, willful misconduct or illegal or
negligent breach of fiduciary duty by the Advisor, or (ii) if any of the
following events occur: (A) the Advisor shall breach any material provision of
this Agreement, and after written notice of such breach, shall not cure such
default within thirty (30) days or have begun action within thirty (30) days to
cure the default which shall be completed with reasonable diligence; (B) the
Advisor shall be adjudged bankrupt or insolvent by a court of competent
jurisdiction, or an order shall be made by a court of competent jurisdiction for
the appointment of a receiver, liquidator, or trustee of the Advisor, for all or
substantially all its property by reason of the foregoing, or if a court of
competent jurisdiction approves any petition filed against the Advisor for
reorganization, and such adjudication or order shall remain in force or unstayed
for a period of thirty (30) days; or (C) the Advisor shall institute proceedings
for voluntary bankruptcy or shall file a petition seeking reorganization under
the federal bankruptcy laws, or for relief under any law for relief of debtors,
or shall consent to the appointment of a receiver for itself or for all or
substantially all its property, or shall make a general assignment for the
benefit of its creditors, or shall admit in writing its inability to pay its
debts, generally, as they become due. Notwithstanding the foregoing, a
Transition consummated in accordance with Section 18(c) shall not be deemed to
constitute Cause.

 

“Change of Control” means (a) the consummation of any sale, lease, transfer,
conveyance or other disposition (including by way of liquidation or dissolution
of the Company or one or more of its Subsidiaries), in a single transaction or
in a related series of transactions, of all or substantially all of the assets
of the Company and its Subsidiaries, taken as a whole, to any other unaffiliated
Person(s) other than the Advisor or its Affiliates; (b) any unaffiliated Person,
other than the Advisor or its Affiliates, becoming, in a single transaction or
in a related series of transactions, whether by way of purchase, acquisition,
tender, exchange or other similar offer or recapitalization, reclassification,
consolidation, merger, share exchange, scheme of arrangement or other business
combination transaction, the beneficial owner of more than fifty-one percent
(51.0%) of the combined voting power of the outstanding voting stock or
equivalent voting interest the Company entitled to vote generally in the
election of Directors; or (c) other than with respect to a transaction involving
the Advisor or its Affiliates, the consummation of any recapitalization,
reclassification, consolidation, merger, share exchange, scheme of arrangement
or other business combination transaction immediately following which the
beneficial owners of the voting stock or equivalent voting interest the Company
entitled to vote generally in the election of Directors immediately prior to the
consummation of such transaction do not beneficially own more than forty-nine
percent (49.0%) of the combined voting power of the outstanding voting stock or
equivalent voting interest of such Person entitled to vote generally in the
election of

 

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Directors (or Persons performing a similar function) of the entity resulting
from such transaction (including an entity that, as a result of such
transaction, owns such Person or all or substantially all of the assets of such
Person and its subsidiaries, taken as a whole, either directly or indirectly
through one or more subsidiaries of such entity) in substantially the same
proportion as their beneficial ownership of the voting stock or equivalent
voting interest of such Person entitled to vote generally in the election of
Directors (or Persons performing a similar function) immediately prior to such
transaction.

 

“Change of Control Fee” means an amount equal to the product of (i) 4 multiplied
by (ii) the Subject Fees.

 

“Change of Control Notice” has the meaning set forth in Section 18(b).

 

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

 

“Common Stock” means the shares of the Company’s common stock, par value $0.01
per share.

 

“Company” has the meaning set forth in the preamble.

 

“Contract Purchase Price” means the amount actually paid or allocated in respect
of (including, without duplication, any indebtedness and fair market value of
any liability assumed in) the purchase, development, improvement or construction
of a Real Estate Asset or the amount of funds advanced with respect to a
Mortgage, or the amount actually paid or allocated in respect of the purchase of
other Investments, in each case exclusive of Acquisition Expenses.

 

“Core Earnings” means the net income (loss), computed in accordance with GAAP,
excluding (i) non-cash equity compensation expense, (ii) the Variable
Management/Incentive Fee, (iii) acquisition and transaction related fees and
expenses, (iv) financing related fees and expenses, (v) depreciation and
amortization, (vi) realized gains and losses on the sale of assets, (vii) any
unrealized gains or losses or other non-cash items that are included in net
income (loss) for the applicable reporting period, regardless of whether such
items are included in other comprehensive income or loss, or in net income,
(viii) one-time events pursuant to changes in GAAP and certain non-cash charges,
(ix) impairment losses on real estate related investments other than temporary
impairment of securities, (x) amortization of deferred financing costs, (xi)
amortization of tenant inducements, (xii) amortization of straight-line rent and
any associated bad debt reserves, (xiii) amortization of market lease
intangibles, (xiv) provision for loan losses and (xv) other non-recurring
revenue and expenses, in each case after discussions between the Advisor and the
Independent Directors and approved by a majority of the Independent Directors.

 

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“Core Earnings Per Adjusted Share” means, for the applicable period, Core
Earnings divided by the Adjusted Outstanding Shares for such period.

 

“Dealer Manager” means Realty Capital Securities, LLC, or such other Person
selected by the Board of Directors to act as the dealer manager for the
Offering.

 

“Dealer Manager Fee” means the fee from the sale of Shares in a Primary
Offering, payable to the Dealer Manager for serving as the dealer manager of
such Primary Offering.

 

“Director” means a director of the Company.

 

“Distributions” means any distributions of money or other property by the
Company to Stockholders, including distributions that may constitute a return of
capital for U.S. federal income tax purposes.

 

“Equity Proceeds” means with respect to any period, the cumulative net proceeds
of all common and preferred equity issued by the Company and its subsidiaries
during such period, including: (1) any equity issued in exchange or conversion
of (x) exchangeable notes based on the stock price at the date of issuance and
(y) convertible equity of the Company; and (2) any other issuances of equity,
including but not limited to units in the Operating Partnership (excluding
equity based compensation but including issuances related to an acquisition,
investment, joint-venture or partnership), but excluding equity issued as a
stock-for-stock dividend or as part of a dividend reinvestment program.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, or any successor statute thereto. Reference to any provision of the
Exchange Act shall mean such provision as in effect from time to time, as the
same may be amended, and any successor provision thereto, as interpreted by any
applicable regulations as in effect from time to time.

 

“FINRA” means the Financial Industry Regulatory Authority, Inc.

 

“GAAP” means United States generally accepted accounting principles,
consistently applied.

 

“Good Reason” means: (i) any failure to obtain a satisfactory agreement from any
successor to the Company or the Operating Partnership to assume and agree to
perform obligations under this Agreement; or (ii) any material breach of this
Agreement of any nature whatsoever by the Company or the Operating Partnership.

 

“Gross Proceeds” means the aggregate purchase price of all Shares sold for the
account of the Company through an Offering, without deduction for Selling
Commissions, volume discounts, any marketing support and due diligence expense
reimbursement or Organization and Offering Expenses. For the purpose of
computing Gross Proceeds, the purchase price of any Share for which reduced
Selling Commissions are paid to the Dealer Manager or a Soliciting Dealer (where
net proceeds to the

 

5 

 

Company are not reduced) shall be deemed to be the full amount of the offering
price per Share pursuant to the Prospectus for such Offering without reduction.

 

“Indemnitee” has the meaning set forth in Section 20.

 

“Independent Director” means a Director who is not and who has not been within
the last two years, directly or indirectly associated with the Sponsor or the
Advisor by virtue of ownership of an interest in the Sponsor, the Advisor or any
of their Affiliates.

 

“Independent Valuation Advisor” means a firm that is (i) engaged in the business
of conducting appraisals on real estate properties, (ii) not an affiliate of the
Advisor and (iii) engaged by the Company with the Board’s approval to appraise
the Real Properties and other Investments pursuant to the Valuation Guidelines.

 

“Insourced Acquisition Expenses” means Acquisition Expenses incurred in
connection with services performed by the Advisor or any of its Affiliates,
including legal advisory expenses, due diligence expenses, personnel expenses,
acquisition-related administrative and advisory expenses, survey, property,
contract review expenses, travel and communications expenses and other closing
costs.

 

“Investments” means any investments by the Company or the Operating Partnership,
directly or indirectly, in Real Estate Assets, Real Estate Related Loans or any
other asset.

 

“Joint Ventures” means the joint venture or partnership or other similar
arrangements (other than between the Company and the Operating Partnership) in
which the Company or the Operating Partnership or any of their subsidiaries is a
co-venturer, limited liability company member, limited partner or general
partner, which are established to acquire or hold Investments.

 

“Listing” means the listing of the Common Stock on an exchange, or the inclusion
of the Common Stock for trading in the over-the-counter-market.

 

“Loans” means any indebtedness or obligations in respect of borrowed money or
evidenced by bonds, notes, debentures, deeds of trust, letters of credit or
similar instruments, including mortgages and mezzanine loans.

 

“Market Check” means an analysis comparing (a) the amount of Insourced
Acquisition Expenses paid in the previous calendar year to the Advisor or any of
its Affiliates with (b) the projected amount of Acquisition Expenses for the
following calendar year assuming that a Person other than the Advisor or its
Affiliates performs substantially similar services for a substantially similar
amount of Investments.

 

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

 

6 

 

“NASAA REIT Guidelines” means the Statement of Policy Regarding Real Estate
Investment Trusts as revised and adopted by the North American Securities
Administrators Association on May 7, 2007, as the same may be amended from time
to time.

 

“NAV” means the Company’s net asset value, calculated pursuant to the Valuation
Guidelines.

 

“Notice Date” has the meaning set forth in Section 18(c)(ii).

 

“Offering” means any public offering and sale of Shares pursuant to an effective
registration statement filed under the Securities Act.

 

“Operating Partnership” has the meaning set forth in the preamble.

 

“Operating Partnership Agreement” means the Agreement of Limited Partnership of
the Operating Partnership, dated as of February 14, 2013, among the Company,
Healthcare Trust Special Limited Partnership, LLC, and the Advisor, as the same
may be amended from time to time.

 

“OP Units” means units of limited partnership interest in the Operating
Partnership.

 

“Organization and Offering Expenses” means all expenses (other than the Selling
Commission and the Dealer Manager Fee) to be paid by the Company in connection
with an Offering, including legal, accounting, printing, mailing and filing
fees, charges of the escrow holder and transfer agent, charges of the Advisor
for administrative services related to the issuance of Shares in an Offering,
reimbursement of the Advisor for costs in connection with preparing supplemental
sales materials, the cost of bona fide training and education meetings held by
the Company (primarily the travel, meal and lodging costs of the registered
representatives of broker-dealers), attendance and sponsorship fees and cost
reimbursement for employees of the Company’s Affiliates to attend retail
seminars conducted by broker-dealers and, in special cases, reimbursement to
soliciting broker-dealers for technology costs associated with an Offering,
costs and expenses related to such technology costs, and costs and expenses
associated with facilitation of the marketing of the Shares and the ownership of
Shares by such broker-dealer’s customers.

 

“Original Advisory Agreement” has the meaning set forth in the recitals.

 

“Person” means an individual, corporation, partnership, estate, trust (including
a trust qualified under Sections 401(a) or 501(c)(17) of the Code), portion of a
trust permanently set aside for or to be used exclusively for the purposes
described in Section 642(c) of the Code, association, private foundation within
the meaning of Section 509(a) of the Code, joint stock company or other legal
entity and also includes a group as that term is used for purposes of Section
13(d)(3) of the Exchange Act.

 

7 

 

“Primary Offering” means the portion of an Offering other than the Shares
offered pursuant to the Company’s distribution reinvestment plan.

 

“Prospectus” means a final prospectus of the Company filed pursuant to Rule
424(b) of the Securities Act, as the same may be amended or supplemented from
time to time.

 

“Real Estate Assets” means any investment by the Company or the Operating
Partnership in unimproved and improved Real Property (including fee or leasehold
interests, options and leases), directly, through one or more subsidiaries or
through a Joint Venture.

 

“Real Estate Related Loans” means any investments in mortgage loans and other
types of real estate related debt financing, including, mezzanine loans, bridge
loans, convertible mortgages, wraparound mortgage loans, construction mortgage
loans, loans on leasehold interests and participations in such loans, by the
Company or the Operating Partnership, directly, through one or more subsidiaries
or through a Joint Venture.

 

“Real Property” means (i) land, (ii) rights in land (including leasehold
interests), and (iii) any buildings, structures, improvements, furnishings,
fixtures and equipment located on or used in connection with land and rights or
interests in land.

 

“Registration Statement” means the Company’s registration statement on Form S-11
(File No. 333-180274) and the prospectus contained therein.

 

“REIT” means a corporation, trust, association or other legal entity (other than
a real estate syndication) that is engaged primarily in investing in equity
interests in real estate (including fee ownership and leasehold interests) or in
loans secured by real estate or both, as defined pursuant to Sections 856
through 860 of the Code and any successor or other provisions of the Code
relating to real estate investment trusts (including provisions as to the
attribution of ownership of beneficial interests therein) and the regulations
promulgated thereunder.

 

“Sale” or “Sales” means any transaction or series of transactions whereby: (i)
the Company or the Operating Partnership directly or indirectly (except as
described in other subsections of this definition) sells, grants, transfers,
conveys, or relinquishes its direct or indirect ownership of any Real Estate
Assets, Loan or other Investment or portion thereof, including the lease of any
Real Estate Assets consisting of a building only, and including any event with
respect to any Real Estate Assets that gives rise to a significant amount of
insurance proceeds or condemnation awards; (ii) the Company or the Operating
Partnership directly or indirectly (except as described in other subsections of
this definition) sells, grants, transfers, conveys, or relinquishes its
ownership of all or substantially all the direct or indirect interest of the
Company or the Operating Partnership in any Joint Venture in which it is a
co-venturer, member or partner; (iii) any Joint Venture directly or indirectly
(except as described in other subsections of this definition) in which the
Company or the Operating Partnership as a co-venturer, member or partner sells,
grants, transfers, conveys, or relinquishes its direct or indirect ownership

 

8 

 

of any Real Estate Assets or portion thereof, including any event with respect
to any Real Estate Assets which gives rise to insurance claims or condemnation
awards; or (iv) the Company or the Operating Partnership directly or indirectly
(except as described in other subsections of this definition) sells, grants,
conveys or relinquishes its direct or indirect interest in any Real Estate
Related Loans or portion thereof (including with respect to any Real Estate
Related Loan, all payments thereunder or in satisfaction thereof other than
regularly scheduled interest payments) and any event which gives rise to a
significant amount of insurance proceeds or similar awards; or (v) the Company
or the Operating Partnership directly or indirectly (except as described in
other subsections of this definition) sells, grants, transfers, conveys, or
relinquishes its direct or indirect ownership of any other asset not previously
described in this definition or any portion thereof, but not including any
transaction or series of transactions specified in clauses (i) through (v) above
in which the proceeds of such transaction or series of transactions are
reinvested by the Company in one or more assets within 180 days thereafter.

 

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

 

“Selling Commission” means the fee payable to the Dealer Manager and reallowable
to Soliciting Dealers with respect to Shares sold by them in a Primary Offering.

 

“Shares” means the shares of beneficial interest or of common stock of the
Company of any class or series, including Common Stock, that has the right to
elect the Directors of the Company.

 

“Soliciting Dealers” means broker-dealers that are members of FINRA, or that are
exempt from broker-dealer registration, and that, in either case, have executed
soliciting dealer or other agreements with the Dealer Manager to sell Shares.

 

“Sponsor” means American Realty Capital VII, LLC, a Delaware limited liability
company.

 

“Stockholders” means the holders of record of the Shares as maintained on the
books and records of the Company or its transfer agent.

 

“Subject Fees” means (i) the product of (x) four (4) multiplied by (y) the
actual Base Management Fee, plus (ii) the product of (x) four (4) multiplied by
(y) the actual Variable Management/Incentive Fee, in each of clauses (i) and
(ii), payable for the fiscal quarter immediately prior to the fiscal quarter in
which the Change of Control occurs or the Transition is consummated, as
applicable, plus (iii) without duplication, the annual increase in the Base
Management Fee resulting from Equity Proceeds in respect of the fiscal quarter
immediately prior to the fiscal quarter in which the Change of Control occurs or
the Transition is consummated, as applicable.

 

9 

 

“Termination Date” means the date of termination of this Agreement.

 

“Trading Day” means a day on which the principal national securities exchange on
which a security is listed or admitted to trading is open for the transaction of
business or, if a security is not listed or admitted to trading on any national
securities exchange, shall mean any day other than a Saturday, a Sunday or a day
on which banking institutions in the State of New York are authorized or
obligated by law or executive order to close.

 

“Transition” has the meaning set forth in Section 18(c).

 

“Transition Fee” means an amount equal to (i) $15,000,000; plus (ii) (x) 4
multiplied by (y) the Subject Fees; provided, that in no event shall the
Transition Fee exceed an amount equal to (a) 4.5 multiplied by (b) the Subject
Fees.

 

“Value” means, with respect to any security, the average of the daily market
price of such security for the ten consecutive Trading Days immediately
preceding the date of such valuation. The market price for each such Trading Day
shall be: (i) if the security is listed or admitted to trading on the NYSE or
any national securities exchange, the last reported sale price, regular way, on
such day, or if no such sale takes place on such day, the average of the closing
bid and asked prices, regular way, on such day, (ii) if the security is not
listed or admitted to trading on the NYSE or any national securities exchange,
the last reported sale price on such day or, if no sale takes place on such day,
the average of the closing bid and asked prices on such day, as reported by a
reliable quotation source designated by the Advisor, or (iii) if the security is
not listed or admitted to trading on the NYSE or any national securities
exchange and no such last reported sale price or closing bid and asked prices
are available, the average of the reported high bid and low asked prices on such
day, as reported by a reliable quotation source designated by the Advisor, or if
there shall be no bid and asked prices on such day, the average of the high bid
and low asked prices, as so reported, on the most recent day (not more than ten
days prior to the date in question) for which prices have been so reported;
provided, that if there are no bid and asked prices reported during the ten days
prior to the date in question, the value of the security shall be determined by
the Advisor acting in good faith on the basis of such quotations and other
information as it considers, in its reasonable judgment, appropriate. In the
event the security includes any additional rights, then the value of such rights
shall be determined by the Advisor acting in good faith on the basis of such
quotations and other information as it considers, in its reasonable judgment,
appropriate.

 

“Variable Management/Incentive Fee” means the fees payable to the Advisor or its
assignees pursuant to Section 10(b).

 

“Valuation Guidelines” means the valuation guidelines adopted by the Board, as
may be amended from time to time.

 

2.           APPOINTMENT. The Company and the Operating Partnership hereby
appoint the Advisor to serve as their advisor to perform the services set forth
herein on

 

10 

 

the terms and subject to the conditions set forth in this Agreement and subject
to the supervision of the Board, and the Advisor hereby accepts such
appointment.

 

3.           DUTIES OF THE ADVISOR. The Advisor will use its reasonable best
efforts to present to the Company and the Operating Partnership potential
investment opportunities and to provide a continuing and suitable investment
program consistent with the investment objectives and policies of the Company as
determined and adopted from time to time by the Board. In performance of this
undertaking, subject to the supervision of the Board and consistent with the
provisions of the Articles of Incorporation, By-laws and the Operating
Partnership Agreement, the Advisor, directly or indirectly, will:

 

(a)           serve as the Company’s and the Operating Partnership’s investment
and financial advisor;

 

(b)            provide the daily management for the Company and the Operating
Partnership and perform and supervise the various administrative functions
necessary for the day-to-day management of the operations of the Company and the
Operating Partnership;

 

(c)             investigate, select and, on behalf of the Company and the
Operating Partnership, engage and conduct business with and supervise the
performance of such Persons as the Advisor deems necessary to the proper
performance of its obligations hereunder (including consultants, accountants,
correspondents, lenders, technical advisors, attorneys, brokers, underwriters,
corporate fiduciaries, escrow agents, depositaries, custodians, agents for
collection, insurers, insurance agents, banks, builders, developers, property
owners, property managers, real estate management companies, real estate
operating companies, securities investment advisors, mortgagors, the registrar
and the transfer agent and any and all agents for any of the foregoing),
including Affiliates of the Advisor and Persons acting in any other capacity
deemed by the Advisor necessary or desirable for the performance of any of the
foregoing services (including entering into contracts in the name of the Company
and the Operating Partnership with any of the foregoing);

 

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

 

(e)             subject to the provisions of Section 4, (i) participate in
formulating an investment strategy and asset allocation framework; (ii) locate,
analyze and select potential Investments; (iii) structure and negotiate the
terms and conditions of transactions pursuant to which acquisitions and
dispositions of Investments will be made; (iv) research, identify, review and
recommend acquisitions and dispositions of Investments to the Board and make
Investments on behalf of the Company and the

 

11 

 

Operating Partnership in compliance with the investment objectives and policies
of the Company; (v) arrange for financing and refinancing and make other changes
in the asset or capital structure of, and dispose of, reinvest the proceeds from
the sale of, or otherwise deal with, Investments; (vi) enter into leases and
service contracts for Real Estate Assets and, to the extent necessary, perform
all other operational functions for the maintenance and administration of such
Real Estate Assets; (vii) actively oversee and manage Investments for purposes
of meeting the Company’s investment objectives and reviewing and analyzing
financial information for each of the Investments and the overall portfolio;
(viii) select Joint Venture partners, structure corresponding agreements and
oversee and monitor these relationships; (ix) oversee, supervise and evaluate
Affiliated and non-Affiliated property managers who perform services for the
Company or the Operating Partnership; (x) oversee Affiliated and non-Affiliated
Persons with whom the Advisor contracts to perform certain of the services
required to be performed under this Agreement; (xi) manage accounting and other
record-keeping functions for the Company and the Operating Partnership,
including reviewing and analyzing the capital and operating budgets for the Real
Estate Assets and generating an annual budget for the Company; (xii) recommend
various liquidity events to the Board when appropriate; and (xiii) source and
structure Real Estate Related Loans;

 

(f)             upon request, provide the Board with periodic reports regarding
prospective investments;

 

(g)            make investments in, and dispositions of, Investments within the
discretionary limits and authority as granted by the Board;

 

(h)            negotiate on behalf of the Company and the Operating Partnership
with banks or other lenders for Loans to be made to the Company, the Operating
Partnership or any of their subsidiaries, and negotiate with investment banking
firms and broker-dealers on behalf of the Company, the Operating Partnership or
any of their subsidiaries, or negotiate private sales of Shares or obtain Loans
for the Company, the Operating Partnership or any of their subsidiaries, but in
no event in such a manner so that the Advisor shall be acting as broker-dealer
or underwriter; provided, however, that any fees and costs payable to third
parties incurred by the Advisor in connection with the foregoing shall be the
responsibility of the Company, the Operating Partnership or any of their
subsidiaries;

 

(i)              obtain reports (which may, but are not required to, be prepared
by the Advisor or its Affiliates), where appropriate, concerning the value of
Investments or contemplated investments of the Company and the Operating
Partnership;

 

(j)              from time to time, or at any time reasonably requested by the
Board, make reports to the Board of its performance of services to the Company
and the Operating Partnership under this Agreement, including reports with
respect to potential conflicts of interest involving the Advisor or any of its
Affiliates;

 

(k)            provide the Company and the Operating Partnership with all
necessary cash management services;

 

12 

 

(l)              deliver to, or maintain on behalf of, the Company copies of all
appraisals obtained in connection with the investments in any Real Estate Assets
as may be required to be obtained by the Board;

 

(m)             notify the Board of all proposed material transactions before
they are completed;

 

(n)            effect any private placement of OP Units, tenancy-in-common (TIC)
or other interests in Investments as may be approved by the Board;

 

(o)            perform investor-relations and Stockholder communications
functions for the Company;

 

(p)            render such services as may be reasonably determined by the Board
of Directors consistent with the terms and conditions herein;

 

(q)            maintain the Company’s accounting and other records and assist
the Company in filing all reports required to be filed by it with the Securities
and Exchange Commission, the Internal Revenue Service and other regulatory
agencies;

 

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

 

(s)             calculate the NAV as provided in the Registration Statement, and
in connection therewith, obtain appraisals performed by the Independent
Valuation Advisor; and

 

(t)              supervise one or more Independent Valuation Advisor and, if and
when necessary, recommend to the Board its replacement.

 

Notwithstanding the foregoing or anything else that may be to the contrary in
this Agreement, the Advisor may delegate any of the foregoing duties to any
Person so long as the Advisor or its Affiliate remains responsible for the
performance of the duties set forth in this Section 3.

 

4.               AUTHORITY OF ADVISOR.

 

(a)             Pursuant to the terms of this Agreement (including the
restrictions included in this Section 4 and in Section 9), and subject to the
continuing and exclusive authority of the Board over the supervision of the
Company, the Company, acting on the authority of the Board of Directors, hereby
delegates to the Advisor the authority to perform the services described in
Section 3.

 

(b)            Notwithstanding anything herein to the contrary, all Investments
will require the prior approval of the Board, any particular Directors specified
by the Board or any committee of the Board specified by the Board, as the case
may be.

 

13 

 

(c)             If a transaction requires approval by the Independent Directors,
the Advisor will deliver to the Independent Directors all documents and other
information reasonably required by them to evaluate properly the proposed
transaction.

 

(d)            The Board may, at any time upon the giving of written notice to
the Advisor, modify or revoke the authority set forth in this Section 4;
provided, however, that such modification or revocation shall be effective upon
receipt by the Advisor and shall not be applicable to investment transactions to
which the Advisor has committed the Company or the Operating Partnership prior
to the date of receipt by the Advisor of such notification.

 

5.               FIDUCIARY RELATIONSHIP. The Advisor, as a result of its
relationship with the Company and the Operating Partnership pursuant to this
Agreement, has a fiduciary responsibility and duty to the Company, the
Stockholders and the partners in the Operating Partnership.

 

6.               NO PARTNERSHIP OR JOINT VENTURE. Except as provided in Section
10(e), the parties to this Agreement are not partners or joint venturers with
each other and nothing herein shall be construed to make them partners or joint
venturers or impose any liability as such on either of them.

 

7.               BANK ACCOUNTS. The Advisor may establish and maintain one or
more bank accounts in the name of the Company or the Operating Partnership and
may collect and deposit into any such account or accounts, and disburse from any
such account or accounts, any money on behalf of the Company or the Operating
Partnership, under such terms and conditions as the Board may approve; provided,
that no funds shall be commingled with the funds of the Advisor; and, upon
request, the Advisor shall render appropriate accountings of such collections
and payments to the Board and to the auditors of the Company.

 

8.               RECORDS; ACCESS. The Advisor shall maintain appropriate records
of all its activities hereunder and make such records available for inspection
by the Directors and by counsel, auditors and authorized agents of the Company,
at any time and from time to time. The Advisor shall at all reasonable times
have access to the books and records of the Company and the Operating
Partnership.

 

9.               LIMITATIONS ON ACTIVITIES. Notwithstanding anything herein to
the contrary, the Advisor shall refrain from taking any action which, in its
sole judgment, or in the sole judgment of the Company, made in good faith, would
(a) adversely affect the status of the Company as a REIT, unless the Board has
determined that REIT qualification is not in the best interests of the Company
and its Stockholders, (b) subject the Company to regulation under the Investment
Company Act of 1940, as amended, or (c) violate any law, rule, regulation or
statement of policy of any governmental body or agency having jurisdiction over
the Company, the Operating Partnership or the Shares, or otherwise not be
permitted by the Articles of Incorporation or By-laws, except if such action
shall be ordered by the Board, in which case the Advisor shall notify promptly
the Board of the Advisor’s judgment of the potential impact of such action and
shall refrain

 

14 

 

from taking such action until it receives further clarification or instructions
from the Board. In such event, the Advisor shall have no liability for acting in
accordance with the specific instructions of the Board so given.

 

10.              FEES.

 

(a)             Limitation on Acquisition Expenses.

 

(i)              The total of all Acquisition Expenses payable in connection
with the Company’s total portfolio of Investments and reinvestments, if any,
shall be reasonable and shall not exceed an amount equal to four and one-half
percent (4.5%) of the Contract Purchase Price of the Company’s total portfolio
of Investments or four and one-half percent (4.5%) of the amount advanced for
the Company’s total portfolio of Investments.

 

(ii)            The total of all Acquisition Expenses payable in connection with
any Investment or any reinvestment shall be reasonable and shall not exceed an
amount equal to four and one-half percent (4.5%) of the Contract Purchase Price
of the Investment or four and one-half percent (4.5%) of the amount advanced for
any Investment; provided, further, however, that a majority of the Directors
(including a majority of the Independent Directors) not otherwise interested in
the transaction may approve fees and expenses in excess of these limits if they
determine the transaction to be commercially competitive, fair and reasonable to
the Company.

 

(b)            Variable Management/Incentive Fee. The Company shall pay the
Advisor a Variable Management/Incentive Fee, payable quarterly in arrears, in an
amount equal to (i) the product of (A) the Adjusted Outstanding Shares for the
calendar quarter multiplied by (B) 15% multiplied by (C) the excess of Core
Earnings Per Adjusted Share for the previous 3-month period over $0.375, plus
(ii) the product of (X) the Adjusted Outstanding Shares for the calendar quarter
multiplied by (Y) 10% multiplied by (Z) the excess of Core Earnings Per Adjusted
Share for the previous 3-month period over $0.47.

 

(c)             Base Management Fee. The Company shall pay the Advisor a Base
Management Fee, payable on the first business day of each month following the
Effective Date. The Base Management Fee shall be equal to (x) $1,625,000; plus
(y) an amount equal to (A) 1.25% of the Equity Proceeds in respect of the period
following the Effective Date, divided by (B) twelve (12).

 

(d)            Payment of Fees.

 

(i)              In connection with the Variable Management/Incentive Fee, the
Company shall pay such fees to the Advisor or its assignees in cash, in Shares,
or a combination of both, the form of payment to be determined in the sole
discretion of the Advisor.

 

15 

 

(ii)            The Base Management Fee shall be payable in the form determined,
at the discretion of the Advisor, in cash, OP Units, Shares, or any combination
thereof.

 

(iii)             For the purposes of the payment of any fees in Shares or OP
Units, each Share or OP Unit, as applicable, shall be valued at the Value of a
Share.

 

(e)             Exclusion of Certain Transactions.

 

(i)              If the Company or the Operating Partnership shall propose to
enter into any transaction in which the Advisor, any Affiliate of the Advisor or
any of the Advisor’s directors or officers has a direct or indirect interest,
then such transaction shall be approved by a majority of the Board not otherwise
interested in such transaction, including a majority of the Independent
Directors.

 

(ii)            Neither the Company nor the Operating Partnership shall make
Loans to the Advisor or any Affiliate thereof or certain of the Stockholders
except Mortgages or loans to wholly owned subsidiaries of the Company. None of
the Advisor nor any Affiliate thereof, or certain of the Stockholders shall make
loans to the Company or the Operating Partnership, or to Joint Ventures, unless
approved by a majority of the Directors (including a majority of the Independent
Directors) not otherwise interested in such transaction as fair, competitive,
and commercially reasonable, and no less favorable to the Company or Operating
Partnership, as applicable, than comparable loans between unaffiliated parties.

 

(iii)             The Company and the Operating Partnership may enter into Joint
Ventures with the Advisor or its Affiliates provided that (a) a majority of
Directors (including a majority of Independent Directors) not otherwise
interested in the transaction approves the transaction as being fair and
reasonable to the Company or Operating Partnership, as applicable, and (b) the
investment by the Company or Operating Partnership, as applicable, is on
substantially the same terms as those received by other joint venturers.

 

(f)             Limitation on Insourced Acquisition Expenses.

 

(i)              The total of all Insourced Acquisition Expenses with respect to
any Investment shall initially be fixed at, and shall not exceed, 0.50% of the
Contract Purchase Price of the Investment or 0.50% of the amount advanced for an
Investment, which the Company shall pay to the Advisor or its Affiliate at the
closing of each Investment.

 

(ii)            The total of all Insourced Acquisition Expenses for any calendar
year shall initially be fixed at, and shall not exceed, 0.50% of the Contract
Purchase Price of the Investments acquired during such period or 0.50% of the
amounts advanced for the Investments made during such period (to be prorated for
any partial calendar year); provided, however, within a reasonable period of
time following the end of each such calendar year, the Company shall perform a
Market Check and provide the results thereof to the Advisor within a reasonable

 

16 

 

period of time and, if the result of the Market Check is that the projected
amount of Acquisition Expenses that would be incurred if substantially similar
services with respect to a substantially similar amount of properties were to be
provided by a Person other than the Advisor or any of its Affiliates during the
subsequent calendar year is lower than the amount of Insourced Acquisition
Expenses paid to the Advisor or its Affiliates during the previous calendar
year, either (A) the Advisor shall agree to reduce the cap on the Insourced
Acquisition Expenses until the next Market Check such that the cap on Insourced
Acquisition Expenses does not exceed the projected amount of Acquisition
Expenses that would be incurred if substantially similar services with respect
to a substantially similar amount of properties were to be provided by a Person
other than the Advisor or any of its Affiliates during the subsequent calendar
year or (B) the Company may outsource to a Person other than the Advisor or its
Affiliate certain services previously provided by the Advisor or its Affiliates
until the next Market Check.

 

11.              EXPENSES.

 

(a)             In addition to the compensation paid to the Advisor pursuant to
Section 10, the Company or the Operating Partnership shall pay directly or
reimburse the Advisor, quarterly and in arrears, for all the expenses paid or
incurred by the Advisor or its Affiliates in connection with the services it
provides to the Company and the Operating Partnership pursuant to this
Agreement, including, the following:

 

(i)              Organization and Offering Expenses, including third-party due
diligence fees related to the Primary Offering, as set forth in detailed and
itemized invoices; provided, however, that the Company shall not reimburse the
Advisor to the extent such reimbursement would cause the total amount of
Organization and Offering Expenses paid by the Company and the Operating
Partnership to exceed two percent (2.0%) of the Gross Proceeds raised in all
Primary Offerings;

 

(ii)            Acquisition Expenses, subject to the limitations set forth in
Section 10(a), and Insourced Acquisition Expenses, subject to the limitations
set forth in Section 10(e);

 

(iii)             the actual cost of goods and services used by the Company and
obtained from entities not Affiliated with the Advisor;

 

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

 

(v)            taxes and assessments on income of the Company or Investments;

 

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

 

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

 

17 

 

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

 

(ix)             expenses associated with a Listing, if applicable, or with the
issuance and distribution of Shares, such as selling commissions and fees,
advertising expenses, taxes, legal and accounting fees, listing and registration
fees;

 

(x)            expenses connected with payments of Distributions;

 

(xi)             expenses of organizing, revising, amending, converting,
modifying or terminating the Company, the Operating Partnership or any
subsidiary thereof or the Articles of Incorporation, By-laws or governing
documents of the Operating Partnership or any subsidiary of the Company or the
Operating Partnership;

 

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

 

(xiii)         administrative service expenses, including all costs and expenses
incurred by the Advisor or its Affiliates in fulfilling its duties hereunder,
including reasonable salaries and wages, benefits and overhead of all employees
directly involved in the performance of such services; provided, however, that
no reimbursement shall be made for costs of such employees of the Advisor or its
Affiliates to the extent that such employees perform services for which the
Advisor receives a separate fee; and

 

(xiv)         audit, accounting and legal fees.

 

(b)            Commencing upon the earlier to occur of (i) the fifth fiscal
quarter after the Company makes its first Investment and (ii) six (6) months
after the commencement of the initial Offering, expenses incurred by the Advisor
on behalf of the Company and the Operating Partnership or in connection with the
services provided by the Advisor hereunder and payable pursuant to this Section
11 shall be reimbursed (excluding Insourced Acquisition Expenses which shall be
reimbursed as described in Section 10(f)(i) of this Agreement), no less than
monthly, to the Advisor.

 

12.              OTHER SERVICES. Should the Board request that the Advisor or
any director, officer or employee thereof render services for the Company and
the Operating Partnership other than set forth in Section 3, such services shall
be separately compensated at such customary rates and in such customary amounts
as are agreed upon by the Advisor and the Board, including a majority of the
Independent Directors, subject to the limitations contained in the Articles of
Incorporation, and shall not be deemed to be services pursuant to the terms of
this Agreement.

 

18 

 

13.              OTHER ACTIVITIES OF THE ADVISOR. Except as set forth in this
Section 13, nothing herein contained shall prevent the Advisor or any of its
Affiliates from engaging in or earning fees from other activities, including the
rendering of advice to other Persons (including other REITs) and the management
of other programs advised, sponsored or organized by the Sponsor or its
Affiliates; nor shall this Agreement limit or restrict the right of any
director, officer, member, partner, employee or stockholder of the Advisor or
any of its Affiliates to engage in or earn fees from any other business or to
render services of any kind to any other Person and earn fees for rendering such
services; provided, however , that the Advisor must devote sufficient resources
to the Company’s business to discharge its obligations to the Company under this
Agreement. The Advisor may, with respect to any investment in which the Company
is a participant, also render advice and service to each and every other
participant therein, and earn fees for rendering such advice and service.
Specifically, it is contemplated that the Company may enter into Joint Ventures
or other similar co-investment arrangements with certain Persons, and pursuant
to the agreements governing such Joint Ventures or arrangements, the Advisor may
be engaged to provide advice and service to such Persons, in which case the
Advisor will earn fees for rendering such advice and service.

 

The Advisor shall report to the Board the existence of any condition or
circumstance, existing or anticipated, of which it has knowledge, which creates
or could create a conflict of interest between the Advisor’s obligations to the
Company and its obligations to or its interest in any other Person. If the
Advisor, Director or Affiliates thereof have sponsored other investment programs
with similar investment objectives which have investment funds available at the
same time as the Company, the Advisor shall inform the Board of the method to be
applied by the Advisor in allocating investment opportunities among the Company
and competing investment entities and shall provide regular updates to the Board
of the investment opportunities provided by the Advisor to competing programs in
order for the Board (including the Independent Directors) to fulfill its duty to
ensure that the Advisor and its Affiliates use their reasonable best efforts to
apply such method fairly to the Company.

 

14.              THE AMERICAN REALTY CAPITAL NAME. The Advisor and its
Affiliates have or may have a proprietary interest in the names “American Realty
Capital,” “ARC”, “AR Capital” and “AR Global.” The Advisor hereby grants to the
Company, to the extent of any proprietary interest the Advisor may have in any
of the names “American Realty Capital,” “ARC”, “AR Capital” and “AR Global,” a
non-transferable, non-assignable, non-exclusive, royalty-free right and license
to use the names “American Realty Capital,” “ARC”, “AR Capital” and “AR Global”
during the term of this Agreement. The Company agrees that the Advisor and its
Affiliates will have the right to approve of any use by the Company of the names
“American Realty Capital,” “ARC”, “AR Capital” and “AR Global,” such approval
not to be unreasonably withheld or delayed. Accordingly, and in recognition of
this right, if at any time the Company ceases to retain the Advisor or one of
its Affiliates to perform advisory services for the Company, the Company will,
promptly after receipt of written request from the Advisor, cease to conduct
business under or use the names “American Realty Capital,” “ARC”, “AR Capital”
and “AR Global” or any derivative thereof and the Company shall change its name
and the names of any of its subsidiaries to a name that does not contain

 

19 

 

the names “American Realty Capital,” “ARC”, “AR Capital” and “AR Global” or any
other word or words that might, in the reasonable discretion of the Advisor, be
susceptible of indication of some form of relationship between the Company and
the Advisor or any its Affiliates. At such time, the Company will also make any
changes to any trademarks, servicemarks or other marks necessary to remove any
references to the words “American Realty Capital,” “ARC”, “AR Capital” and “AR
Global.” Consistent with the foregoing, it is specifically recognized that the
Advisor or one or more of its Affiliates has in the past and may in the future
organize, sponsor or otherwise permit to exist other investment vehicles
(including vehicles for investment in real estate) and financial and service
organizations having any of the names “American Realty Capital,” “ARC”, “AR
Capital” and “AR Global” as a part of their name, all without the need for any
consent (and without the right to object thereto) by the Company. Neither the
Advisor nor any of its Affiliates makes any representation or warranty, express
or implied, with respect to the names “American Realty Capital,” “ARC”, “AR
Capital” and “AR Global” licensed hereunder or the use thereof (including
without limitation as to whether the use of the names “American Realty Capital,”
“ARC” and “AR Capital” will be free from infringement of the intellectual
property rights of third parties. Notwithstanding the preceding, the Advisor
represents and warrants that it is not aware of any pending claims or litigation
or of any claims threatened in writing regarding the use or ownership of the
names “American Realty Capital,” “ARC” and “AR Capital.”

 

15.              TERM OF AGREEMENT. This Agreement shall be in effect from the
Effective Date through the tenth (10th) anniversary of the Effective Date and
shall be automatically renewed for successive ten-year terms on each anniversary
of such tenth (10th) anniversary date unless either party gives written notice
of its election not to renew at least three hundred sixty-five (365) days prior
to the applicable tenth (10th) anniversary date. For the avoidance of doubt,
upon expiration of this Agreement in accordance with this Section 15 at the end
of its term, neither the Change of Control Fee nor the Transition Fee shall be
owed to the Advisor, unless a Change of Control has occurred or a Transition has
been consummated, in each case, prior to any such expiration of this Agreement
at the end of the applicable ten (10) year term.

 

16.              TERMINATION BY THE PARTIES. Notwithstanding Section 15, this
Agreement may be terminated (i) in accordance with Section 18(b) or Section
18(c), (ii) upon forty-five (45) days’ prior written notice by sixty-seven
percent (67%) of the Independent Directors of the Company with Cause without
penalty, or (iii) upon sixty (60) days’ prior written notice by the Advisor for
Good Reason. The provisions of Sections 14 and 18 through 30 (inclusive) of this
Agreement shall survive any expiration or earlier termination of this Agreement.

 

17.              ASSIGNMENT. This Agreement may be assigned by the Advisor (a)
to an Affiliate of the Advisor, or (b) to any party with expertise in commercial
real estate and which has, together with its Affiliates, over $100 million of
assets under management. The Advisor may assign any rights to receive fees or
other payments under this Agreement to any Person without obtaining the approval
of the Directors. This Agreement shall not be assigned by the Company or the
Operating Partnership without the consent of the Advisor, except in the case of
an assignment by the Company or the

 

20 

 

Operating Partnership to a Person which is a successor to all the assets, rights
and obligations of the Company or the Operating Partnership, in which case such
successor Person shall be bound hereunder and by the terms of said assignment in
the same manner as the Company or the Operating Partnership, as applicable, is
bound by this Agreement; provided, that in the event any such assignment
constitutes a Change of Control, the Advisor shall be entitled to receive from
the Company or the Operating Partnership the Change of Control Fee in accordance
with Section 18(a).

 

18.              PAYMENTS TO AND DUTIES OF ADVISOR UPON TERMINATION.

 

(a)             Amounts Owed. After the Termination Date, the Advisor shall be
entitled to receive from the Company or the Operating Partnership within thirty
(30) days after the effective date of such termination all amounts then accrued
and owing to the Advisor, including the Change of Control Fee in the event of a
termination in connection with a Change of Control, the Transition Fee in the
event of a termination in connection with a Transition, and all its interest in
the Company’s income, losses, distributions and capital by payment of an amount
equal to the then-present fair market value of the Advisor’s interest.

 

(b)            Change of Control. The Company or the Advisor shall have the
right to terminate this Agreement at any time during the term of this Agreement
in connection with a Change of Control on the later of (x) the consummation of
such Change of Control and (y) the date following such Change of Control that is
six (6) months after the Company or the Advisor has received written notice (the
“Change of Control Notice”) of the other party’s desire to so terminate this
Agreement; provided, however, that the Change of Control Notice may not be
received earlier than February 14, 2019. Notwithstanding the foregoing, at any
time after the Advisor has received a Change of Control Notice, the Company
shall have the right to terminate this Agreement during any period following a
Change of Control immediately upon (i) written notice to the Advisor and (ii)
payment to the Advisor in cash of the remaining amounts that would have been
payable to the Advisor through the date that is six (6) months following the
Advisor’s receipt of the Change of Control Notice.

 

(c)             Transition to Self-Management. The Company shall have the right
to transition to self-management (a “Transition”) at any time during the term of
this Agreement if:

 

(i)              more than 67% of the Independent Directors have approved such
Transition;

 

(ii)            the Company has provided written notice to the Advisor of the
approval described in clause (i) above (the date such notice is received by the
Advisor, the “Notice Date”); provided, however, that the Notice Date shall not
be earlier than February 14, 2019; and

 

21 

 

(iii)             the effective date of Transition is at least six (6) months,
but not more than twelve (12) months, following the Notice Date; provided, that
the Company shall have the option to extend the effective date of Transition for
an additional three (3) months if, during the twelve (12) months following the
Notice Date, the Company has been working, and continues to work, in good faith
to complete a transaction, Listing or Offering that the Company is undertaking
in conjunction with such Transition.

 

(d)            Advisor’s Duties. The Advisor shall promptly upon termination of
this Agreement:

 

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

 

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

 

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

 

(iv)             cooperate with the Company and the Operating Partnership to
provide an orderly management transition.

 

19.              INCORPORATION OF THE ARTICLES OF INCORPORATION AND THE
OPERATING PARTNERSHIP AGREEMENT. To the extent that the Articles of
Incorporation or the Operating Partnership Agreement as in effect on the date
hereof impose obligations or restrictions on the Advisor or grant the Advisor
certain rights which are not set forth in this Agreement, the Advisor shall
abide by such obligations or restrictions and such rights shall inure to the
benefit of the Advisor with the same force and effect as if they were set forth
herein.

 

20.              INDEMNIFICATION BY THE COMPANY AND THE OPERATING PARTNERSHIP.

 

(a)             The Company and the Operating Partnership, jointly and
severally, shall indemnify and hold harmless the Advisor and its Affiliates, as
well as their respective officers, directors, equity holders, members, partners,
stockholders, other equity holders and employees (collectively, the
“Indemnitees,” and each, an “Indemnitee”), from and against all losses, claims,
damages, losses, joint or several, expenses (including reasonable attorneys’
fees and other legal fees and expenses), judgments, fines, settlements, and
other amounts (collectively, “Losses,” and each, a “Loss”) arising in the
performance of their duties hereunder, including reasonable attorneys’ fees, to
the extent such Losses are not fully reimbursed by insurance, and to the extent
that such

 

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indemnification would not be inconsistent with the laws of the State of New
York, the Articles of Incorporation or the provisions of Section II.G of the
NASAA REIT Guidelines, if applicable. Notwithstanding the foregoing, the Company
and the Operating Partnership shall not provide for indemnification of an
Indemnitee for any Loss suffered by such Indemnitee, nor shall they provide that
an Indemnitee be held harmless for any Loss suffered by the Company and the
Operating Partnership, unless all the following conditions are met:

 

(i)              the Indemnitee has determined, in good faith, that the course
of conduct that caused the loss or liability was in the best interest of the
Company and the Operating Partnership;

 

(ii)            the Indemnitee was acting on behalf of, or performing services
for, the Company or the Operating Partnership;

 

(iii)             such Loss was not the result of negligence or willful
misconduct by the Indemnitee; and

 

(iv)             such indemnification or agreement to hold harmless is
recoverable only out of the Company’s net assets and not from the Stockholders.

 

(b)            Notwithstanding the foregoing, an Indemnitee shall not be
indemnified by the Company and the Operating Partnership for any Losses arising
from or out of an alleged violation of federal or state securities laws by such
Indemnitee 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 Indemnitee;

 

(ii)            such claims have been dismissed with prejudice on the merits by
a court of competent jurisdiction as to the Indemnitee; or

 

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

 

(c)             In addition, the advancement of the Company’s or the Operating
Partnership’s funds to an Indemnitee for legal expenses and other costs incurred
as a result of any legal action for which indemnification is being sought is
permissible only if all the following conditions are satisfied:

 

(i)              the legal action relates to acts or omissions with respect to
the performance of duties or services on behalf of the Company or the Operating
Partnership;

 

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(ii)            the legal action is initiated by a third party who is not a
Stockholder or the legal action is initiated by a Stockholder acting in such
Stockholder’s capacity as such and a court of competent jurisdiction
specifically approves such advancement; and

 

(iii)             the Indemnitee undertakes to repay the advanced funds to the
Company or the Operating Partnership, together with the applicable legal rate of
interest thereon, in cases in which such Indemnitee is found not to be entitled
to indemnification.

 

21.              INDEMNIFICATION BY ADVISOR. The Advisor shall indemnify and
hold harmless the Company and the Operating Partnership from Losses, including
reasonable attorneys’ fees to the extent that such Losses are not fully
reimbursed by insurance and are incurred by reason of the Advisor’s bad faith,
fraud, willful misfeasance, intentional misconduct, gross negligence or reckless
disregard of its duties; provided, however, that the Advisor shall not be held
responsible for any action of the Board in following or declining to follow any
advice or recommendation given by the Advisor.

 

22.              NOTICES. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report or other communication is required by the Articles of
Incorporation, the By-laws, and shall be given by being delivered by hand, by
courier or overnight carrier or by registered or certified mail to the addresses
set forth below:

 

To the Company:Healthcare Trust, Inc.
405 Park Avenue
New York, New York 10022
Attention: Chief Executive Officer and Chief Financial Officer

 

with a copy to:

 

Proskauer Rose LLP
Eleven Times Square
New York, New York 10036
Attention: Peter M. Fass, Esq.

 

To the Operating Partnership:Healthcare Trust Operating Partnership, L.P.
405 Park Avenue
New York, New York 10022
Attention: Chief Executive Officer and Chief Financial Officer

 

with a copy to:

 

Proskauer Rose LLP
Eleven Times Square

 

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New York, New York 10036
Attention: Peter M. Fass, Esq.

 

To the Advisor:Healthcare Trust Advisors, LLC
405 Park Avenue
New York, New York 10022
Attention: Edward M. Weil, Jr.

 

with a copy to:

 

Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, New York 10019
Attention: Jeffrey D. Marell, Esq.

 

Any party may at any time give notice in writing to the other parties of a
change in its address for the purposes of this Section 22.

 

23.              MODIFICATION. This Agreement shall not be amended,
supplemented, terminated, or discharged, in whole or in part, except by an
instrument in writing signed by the parties hereto, or their respective
successors or assignees.

 

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

 

25.              GOVERNING LAW. The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of New York
as at the time in effect, without regard to the principles of conflicts of laws
thereof.

 

26.              ENTIRE AGREEMENT. This Agreement contains the entire agreement
and understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements, understandings,
inducements and conditions, express or implied, oral or written, of any nature
whatsoever with respect to the subject matter hereof. The express terms hereof
control and supersede any course of performance or usage of the trade
inconsistent with any of the terms hereof.

 

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

 

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28.              PRONOUNS AND PLURALS. Whenever the context may require, any
pronoun used in this Agreement shall include the corresponding masculine,
feminine or neuter forms, and the singular form of nouns, pronouns and verbs
shall include the plural and vice versa.

 

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

 

30.              EXECUTION IN COUNTERPARTS. This Agreement may be executed
(including by facsimile transmission) with counterpart signature pages or in any
number of counterparts, each of which shall be deemed to be an original as
against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument.

 

[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first written above.

 

  HEALTHCARE TRUST, INC.                 By:  /s/ Katie P. Kurtz       Name:
Katie P. Kurtz
Title: Chief Financial Officer                     HEALTHCARE TRUST OPERATING
PARTNERSHIP, L.P.             By: Healthcare Trust, Inc. its General Partner    
                By: /s/ Katie P. Kurtz       Name: Katie P. Kurtz
Title: Chief Financial Officer                     HEALTHCARE TRUST ADVISORS,
LLC             By: Healthcare Trust Special Limited Partnership, LLC, its sole
member             By: American Realty Capital VII, LLC, its sole member        
    By: AR Global Investments, LLC, its sole member                     By: /s/
Edward M. Weil, Jr.       Name: Edward M. Weil, Jr.
Title: Chief Executive Officer  

 

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