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ADVISORY AGREEMENT

This ADVISORY AGREEMENT (this “Agreement”) is entered into on this the 12th day
of November, 2009; by and between UNITED DEVELOPMENT FUNDING IV, a Maryland real
estate investment trust (the “Trust”), and UMTH GENERAL SERVICES, L.P., a
Delaware limited partnership (the “Advisor”).

W I T N E S S E T H

WHEREAS, the Trust intends to issue common shares of beneficial interest, par
value $.01, to the public, upon registration of such shares with the Securities
and Exchange Commission pursuant to the Securities Act of 1933, as amended and
may subsequently issue additional securities;

WHEREAS, the Trust has been formed to originate, acquire, hold, manage,
administer and operate a portfolio of loans secured by real estate and interests
in entities that own real estate, as well as direct investments in real estate
and other real estate-related assets;

WHEREAS, the Trust intends to qualify as a real estate investment trust and to
invest its funds in investments permitted by the terms of the Trust’s
Declaration of Trust and Sections 856 through 860 of the Internal Revenue Code;

WHEREAS, the Trust desires to avail itself of the experience, sources of
information, advice, assistance and certain facilities available to 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
Trustees (the “Board”) of the Trust, all as provided herein; and

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

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

ARTICLE I

DEFINITIONS

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

Acquisition Expenses.  Any and all expenses incurred by the Trust, the Advisor,
or any Affiliate of either in connection with the selection, acquisition or
development of any Asset, whether or not acquired, including, without
limitation, legal fees and expenses, travel and communications expenses, costs
of appraisals, nonrefundable option payments on property not acquired,
accounting fees and expenses, title insurance premiums and other closing costs.

Acquisition and Origination Fees.  Any and all fees and commissions, exclusive
of Acquisition Expenses, paid by any Person to any other duly qualified and
licensed Person (including any fees or commissions paid by or to any duly
qualified and licensed Affiliate of the Trust or the Advisor) in connection with
origination, making or investing in Secured Loans or the purchase, development
or construction of an Asset, including, without limitation, real estate
commissions, selection fees, non-recurring management fees, loan fees, points or
any other fees of a similar nature.

 

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Advisor.  UMTH General Services, L.P., a Delaware limited partnership, any
successor advisor to the Trust, or any Person to which UMTH General Services,
L.P. or any successor advisor subcontracts all or substantially all of its
functions.

Advisory Fees.  The fees payable to the Advisor for day-to-day professional
management services in connection with the Trust and its investment in Assets as
set forth in Section 3.01(b) of this Agreement.

Affiliate or Affiliated.  As to any Person, (i) any Person directly or
indirectly owning, controlling, or holding, with the power to vote, 10% or more
of the outstanding voting securities of such Person; (ii) any Person 10% or more
of whose outstanding voting securities are directly or indirectly owned,
controlled, or held, with power to vote, by such other Person; (iii) any Person,
directly or indirectly, controlling, controlled by, or under common control with
such 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.

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

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

Average Invested Assets.  For a specified period, the average of the aggregate
book value of the Assets, before deducting depreciation, bad debts or other
similar non-cash reserves, computed by taking the average of such values at the
end of each month during such period; provided, however, that during such
periods in which the Board is determining on a regular basis the current value
of the Trust’s net assets for purposes of enabling fiduciaries of employee
benefit plan shareholders to comply with applicable Department of Labor
reporting requirements, “Average Invested Assets” will equal the greater of (i)
the amount determined pursuant to the foregoing or (ii) the most recent Assets’
aggregate valuation established by the Board without reduction for depreciation,
bad debts or other non-cash reserves and without reduction for any debt secured
by or relating to the Assets.

Board.  The Board of Trustees of the Trust.

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

Change of Control.  Any (i) event (including, without limitation, issue,
transfer or other disposition of Shares of beneficial interest of the Trust or
equity interests in the Partnership, merger, share exchange or consolidation)
after which any “person” (as that term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended) is or becomes the “beneficial
owner” (as defined in Rule 13d-j of the Securities Exchange Act of 1934, as
amended), directly or indirectly, of securities of the Trust or the Partnership
representing greater than 50% of the combined voting power of the Trust’s or the
Partnership’s then outstanding securities, respectively; provided, that, a
Change of Control shall not be deemed to occur as a result of any widely
distributed public offering of the Shares or (ii) direct or indirect sale,
transfer, conveyance or other disposition (other than pursuant to clause (i)) in
one or a series of related transactions, of all or substantially all of the
assets of the Company or the Partnership, taken as a whole, to any “person” (as
that term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended).

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

Contract Purchase Price.  The amount (i) actually paid and/or budgeted in
respect of the purchase, development, construction or improvement of a Property,
(ii) of funds advanced with respect to a Secured Loan or (iii) actually paid
and/or budgeted in respect to the purchase of other Assets, in each case
exclusive of Acquisition and Origination Fees and Acquisition Expenses but
including any debt attributable to such acquired Assets.

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

Debt Financing Fee.  The fees payable to the Advisor pursuant to Section 3.01(c)
of this Agreement.

Declaration of Trust.  The Declaration of Trust of the Trust filed with the
Maryland State Department of Assessments and Taxation in accordance with the
Maryland REIT Law, as amended from time to time.

Disposition Fees.  The fees payable to the Advisor for services provided in
connection with the Sale of one or more Assets pursuant to Section 3.01(f) of
this Agreement.

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

Gross Proceeds.  The aggregate purchase price of all Shares sold for the account
of the Trust through an Offering, without deduction for Selling Commissions,
wholesaling fees, marketing support fees, marketing reallowances, due diligence
expense reimbursement, volume discounts, 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 a Soliciting Dealer
(where net proceeds to the Trust 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.

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

Independent Trustee.  A Trustee who is not, on the date of determination and
within the last two years from the date of determination has not been, directly
or indirectly associated with the Sponsor, or the Advisor by virtue of (i)
ownership of an interest in the Sponsor, the Advisor or any of their Affiliates,
other than the Trust, (ii) employment by the Sponsor, the Advisor or any of
their Affiliates, (iii) service as an officer or director of the Sponsor, the
Advisor or any of their Affiliates, other than as a Trustee of the Trust or of
any other real estate investment trust organized by the Sponsor or advised by
the Advisor, (iv) performance of services, other than as a Trustee, for the
Trust, (v) service as a director or trustee of more than three real estate
investment trusts organized by the Sponsor or advised by the Advisor, or (vi)
maintenance of a material business or professional relationship with the
Sponsor, the Advisor or any of their Affiliates.  A business or professional
relationship is considered “material” per se if the aggregate gross revenue
derived by the Trustee from the Sponsor, the Advisor and their Affiliates
exceeds 5.0% of either the Trustee’s annual gross revenue during either of the
last two years or the Trustee’s net worth on a fair market value basis.  An
indirect association with the Sponsor or the Advisor shall include circumstances
in which a Trustee’s spouse, parent, child, sibling, mother- or father-in-law,
son- or daughter-in-law, or brother- or sister-in-law is or has been associated
with the Sponsor, the Advisor, any of their Affiliates or the Trust.

 
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Invested Capital.  The amount calculated by multiplying the total number of
Shares purchased by Shareholders by the issue price at the time of such
purchase, reduced by the portion of any Distribution that is attributable to Net
Sales Proceeds and by any amounts paid by the Trust to repurchase Shares
pursuant to the Trust’s plan for repurchase of Shares.

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

Listing or Listed.  The approval of the Trust’s application to list the Shares
by a national securities exchange and the commencement of trading in the Shares
on the respective national securities exchange.

Market Value.  Upon Listing, the market value of the outstanding Shares,
measured by taking the average closing price for a single Share, over a period
of 30 consecutive trading days, with such period beginning 180 days after
Listing, and multiplying that number by the number of Shares outstanding on the
date of measurement.

NASAA Guidelines.  The Statement of Policy Regarding Real Estate Investment
Trusts published by the North American Securities Administrators Association,
Inc. on May 7, 2007, and in effect on the date hereof.

Net Income.  For any period, the Trust’s total revenues applicable to such
period, less the total expenses applicable to such period other than additions
to reserves for depreciation, bad debts or other similar non-cash reserves and
excluding any gain from the sale of the Assets.  If the Advisor is paid a
Subordinated Incentive Fee or a Subordinated Incentive Listing Fee, “Net
Income,” for purposes of calculating Total Operating Expenses shall exclude the
gain from the Sale of any Assets.

Net Sales Proceeds.  In the case of a transaction described in clause (i)(A) of
the definition of Sale, the proceeds of any such transaction less the amount of
selling expenses incurred by or on behalf of the Trust, including all real
estate commissions, closing costs and legal fees and expenses.  In the case of a
transaction described in clause (i)(B) of such definition, Net Sales Proceeds
means the proceeds of any such transaction less the amount of selling expenses
incurred by or on behalf of the Trust, including any legal fees and expenses and
other selling expenses incurred in connection with such transaction.  In the
case of a transaction described in clause (i)(C) of such definition, Net Sales
Proceeds means the proceeds of any such transaction actually distributed to the
Trust or the Operating Partnership from the Joint Venture less the amount of any
selling expenses, including legal fees and expenses incurred by or on behalf of
the Trust (other than those paid by the Joint Venture).  In the case of a
transaction or series of transactions described in clause (i)(D) of the
definition of Sale, Net Sales Proceeds means the proceeds of any such
transaction (including the aggregate of all payments under a Secured Loan on or
in satisfaction thereof other than regularly scheduled interest payments) less
the amount of selling expenses incurred by or on behalf of the Trust, including
all commissions, closing costs and legal fees and expenses.  In the case of a
transaction described in clause (i)(E) of such definition, Net Sales Proceeds
means the proceeds of any such transaction less the amount of selling expenses
incurred by or on behalf of the Trust, including any legal fees and expenses and
other selling expenses incurred in connection with such transaction.  In the
case of a transaction described in clause (ii) of the definition of Sale, Net
Sales Proceeds means the proceeds of such transaction or series of transactions
less all amounts generated thereby which are reinvested in one or more Assets
within 180 days thereafter and less the amount of any real estate commissions,
closing costs, and legal fees and expenses and other selling expenses incurred
by or allocated to the Trust or the Operating Partnership in connection with
such transaction or series of transactions.  Net Sales Proceeds shall also
include any amounts that the Trust determines, in its discretion, to be
economically equivalent to proceeds of a Sale.  Net Sales Proceeds shall not
include any reserves established by the Trust in its sole discretion.

 
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Offering.  Any public offering and sale of Shares pursuant to an effective
registration statement filed under the Securities Act, other than a public
offering of shares under a distribution reinvestment plan.

Organization and Offering Expenses.  Any and all costs and expenses incurred by
and to be paid from the assets of the Trust in connection with the formation of
the Trust and the qualification and registration of an Offering, and the
marketing and distribution of Shares, including, without limitation, total
underwriting and brokerage discounts and commissions (including fees of the
underwriters’ attorneys); expenses for printing, engraving and amending
registration statements or supplementing prospectuses; mailing and distribution
costs; salaries of employees while engaged in sales activity; telephone and
other telecommunications costs; all advertising and marketing expenses
(including the costs related to investor and broker-dealer sales meetings);
charges of transfer agents, registrars, trustees, escrow holders, depositaries
and experts; and fees, expenses and taxes related to the filing, registration
and qualification of the sale of the Shares under federal and state laws; and
accountants’ and attorneys’ fees.

Partnership.  United Development Funding IV Operating Partnership, L.P., a
Delaware limited partnership, through which the Trust may own Assets.

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

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

Prospectus.  Prospectus has the meaning set forth in Section 2(10) of the
Securities Act, including a preliminary prospectus, an offering circular as
described in Rule 253 of the General Rules and Regulations under the Securities
Act or, in the case of an intrastate offering, any document by whatever name
known, utilized for the purpose of offering and selling securities of the Trust
to the public.

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

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

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

 
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Secured Loans.  In connection with financing provided, invested in, participated
in or purchased by the Trust, 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 or pledges of equity interests in entities owning Real Property.

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

Selling Commissions.  Any and all commissions payable to underwriters or other
broker-dealers in connection with the sale of the Shares, including, without
limitation, commissions payable to the Soliciting Dealers.

Shareholders.  The record holders of the Shares as maintained in the books and
records of the Trust or its transfer agent.

Shareholders’ 10.0% Return.  As of any date, an aggregate amount equal to a
10.0% cumulative, non-compounded, annual return on Invested Capital.

Shares.  Any Shares of the Trust’s common shares of beneficial interest, par
value $.01 per share.

Soliciting Dealers.  Broker-dealers who are members of the Financial Industry
Regulatory Authority, or that are exempt from broker-dealer registration, and
who, in either case, have executed participating broker or other agreements with
the Trust to sell Shares.

Sponsor.  UMT Holdings, L.P.

Subordinated Incentive Fee.  The fee payable to the Advisor under certain
circumstances if certain performance standards have been met pursuant to Section
3.01(d) of this Agreement.

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

 
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Termination Date.  The date of termination of this Agreement.

Total Operating Expenses.  All costs and expenses paid or incurred by the Trust,
as determined under generally accepted accounting principles, which are in any
way related to the operation of the Trust or to Trust business, including
Advisory Fees, but excluding (i) the expenses of raising capital such as
Organization and Offering Expenses, legal, audit, accounting, underwriting,
brokerage, listing, registration, and other fees, printing and other such
expenses and tax incurred in connection with the issuance, distribution,
transfer, registration and Listing of the Shares, (ii) interest payments, (iii)
taxes, (iv) non-cash expenditures such as depreciation, amortization and bad
debt reserves, (v) the Subordinated Incentive Fee, (vi) the Subordinated
Incentive Listing Fee, (vii) Acquisition and Origination Fees and Acquisition
Expenses, (viii) Debt Financing Fees, (ix) real estate commissions on the Sale
of Assets (including Disposition Fees and Securitized Loan Pool Placement Fees),
and (x) other fees and expenses connected with the acquisition, disposition,
management and ownership of real estate interests, mortgage loans or other
property (including the costs of foreclosure, insurance premiums, legal
services, maintenance, repair and improvement of property).

Trust.  United Development Funding IV, a real estate investment trust organized
under the laws of the State of Maryland.

Trustee.  A member of the Board.

ARTICLE II

THE ADVISOR

2.01         Appointment.  The Trust hereby appoints the Advisor to serve as its
advisor on the terms and conditions set forth in this Agreement, and the Advisor
hereby accepts such appointment.  The Advisor shall be deemed to be in a
fiduciary relationship to the Trust and its Shareholders.

2.02         Duties of the Advisor.  Subject to Section 2.07, the Advisor
undertakes to use its commercially reasonable best efforts to present to the
Trust potential investment opportunities consistent with the investment
objectives and policies of the Trust 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 Trust’s most recent
Prospectus for Shares, Declaration of Trust and Bylaws, the Advisor shall,
either directly or by engaging a duly qualified and licensed Affiliate of the
Advisor or other duly qualified and licensed Person:

(a)           manage the formation of the Trust and the Partnership, including
the preparation and filing of all necessary documentation and ancillary
agreements;

(b)           structure, qualify and register the initial Offering;

(c)           coordinate marketing and distribution of the Trust’s Shares in
connection with the initial Offering;

(d)           structure, qualify, register and oversee the distribution of
Shares pursuant to the Trust’s distribution reinvestment plan;

(e)           structure, qualify and administer the repurchase of Shares
pursuant to the Trust’s redemption program;

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

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

(h)           maintain and preserve the books and records of the Trust,
including share books and records reflecting a record of the Shareholders and
their ownership of the Trust’s Shares;

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

(j)            consult with the officers and the Board and assist the Board in
the formulation and implementation of the Trust’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 Trust and in connection with any borrowings proposed to be undertaken by the
Trust;

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

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

(m)          if a transaction requires approval by the Board, deliver to the
Board all documents required by them to properly evaluate the proposed
transaction;

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

(o)          obtain the prior approval of a majority of the Independent Trustees
and a majority of the Board not otherwise interested in any transaction with the
Advisor or its Affiliates;

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

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

(r)            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 Trust
under this Agreement;

(s)            provide the Trust with, or assist the Trust in arranging for, all
necessary cash management services;

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

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

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

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

(x)           assist the Trust in preparing all reports and returns required by
the Securities and Exchange Commission, Internal Revenue Service and other state
or federal governmental agencies; and

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

2.03         Authority of Advisor.  Pursuant to the terms of this Agreement
(including the duties set forth in Section 2.02, and the restrictions included
in this Section 2.03 and in Section 2.06), and subject to the continuing and
exclusive authority of the Board over the management of the Trust, the Board
hereby delegates to the Advisor the authority to (i) locate, analyze and select
investment opportunities, (ii) structure the terms and conditions of
transactions pursuant to which investments will be made or acquired for the
Trust or the Partnership, (iii) make and acquire Secured Loans, acquire
Properties and invest in other Assets in compliance with the investment
objectives and policies of the Trust, (iv) arrange for financing or refinancing
of Assets, (v) enter into leases for the Properties and service contracts for
the Assets with duly qualified and licensed non-affiliated and Affiliated
Persons, including oversight of non-affiliated and Affiliated Persons that
perform management, acquisition, advisory, disposition or other services for the
Trust, and (vi) arrange for, or provide, accounting and other record-keeping
functions at the Asset level.

The Board may, at any time upon the giving of notice to the Advisor, modify or
revoke the authority set forth in this Section 2.03, provided however, that such
modification or revocation shall be effective upon receipt by the Advisor or
such later date as is specified by the Board and included in the notice provided
to the Trust and such modification or revocation shall not be applicable to
investment transactions to which the Advisor has committed the Trust prior to
the date of receipt by the Advisor of such notification, or, if later, the
effective date of such modification or revocation specified by the Board.

 
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2.04         Bank Accounts.  The Advisor may establish and maintain one or more
bank accounts in its own name for the account of the Trust or in the name of the
Trust 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 Trust,
under such terms and conditions as the Board may approve, provided that no funds
of the Trust or the Partnership shall be commingled nor shall any such funds be
commingled with the funds of the Advisor; and the Advisor shall from time to
time, upon request by the Board, its Audit Committee or the auditors of the
Trust, render appropriate accountings of such collections and payments to the
Board, its Audit Committee and the auditors of the Trust.

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

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

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

 
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2.08         Payment of Certain Organization and Offering Expenses.  The Trust
shall pay directly all Organization and Offering Expenses considered
underwriting compensation by the Financial Industry Regulatory Authority.  Such
payments, other than Selling Commissions, bona fide due diligence expense
reimbursements, wholesaling fees, marketing support fees and marketing
reallowances, shall apply toward the limit on Organization and Offering Expenses
reimbursable by the Trust to the Advisor pursuant to Section 3.02(a)(i) below.

ARTICLE III

COMPENSATION AND REIMBURSEMENT OF SPECIFIED COSTS

3.01         Fees.

(a)           Acquisition and Origination Fees and Acquisition Expenses.  The
Trust shall pay to the Advisor or an Affiliate of the Advisor Acquisition and
Origination Fees, and will reimburse the Advisor for Acquisition Expenses, in an
aggregate amount of 3.0% of the net amount available for investment in Assets
(after payment of Selling Commissions, wholesaling fees, marketing support fees,
marketing reallowances and Organization and Offering Expenses).  The total of
all Acquisition and Origination Fees, including Debt Financing Fees, from any
source, and any Acquisition Expenses shall be limited in accordance with the
Declaration of Trust and the NASAA Guidelines.

(b)           Advisory Fees.  The Trust shall pay the Advisor Advisory Fees in
the amount of 2.0% per annum of the Average Invested Assets, payable monthly in
an amount equal to one-twelfth of 2.0% of the Average Invested Assets on the
last day of the immediately preceding month.  The Advisor, in its sole
discretion, may waive, reduce or defer all or any portion of the Advisory Fees
to which it would otherwise be entitled.

(c)            Debt Financing Fee.   In the event of the origination of any debt
financing obtained by the Trust, including the assumption (directly or
indirectly) of existing debt, that is used to acquire properties, to make other
permitted investments or is assumed (directly or indirectly) in connection with
the acquisition of properties, and if the Advisor or an Affiliate of the Advisor
provides a substantial amount of services, as determined by the Independent
Trustees in connection therewith, the Trust will pay to the Advisor or an
Affiliate of the Advisor a Debt Financing Fee equal to 1% of the amount
available to the Trust under such financing.  On each anniversary date of the
origination of such debt financing, the Trust will pay to the Advisor or an
Affiliate of the Advisor an additional fee of 0.25% of the primary loan amount
if such financing continues to be outstanding on such date, or a pro rated
portion of such additional fee for the portion of such year that the financing
was outstanding.

(d)           Subordinated Incentive Fee.  The Trust shall pay to the Advisor a
Subordinated Incentive Fee equal to 15.0% of the amount by which the Trust’s Net
Income for the immediately preceding year exceeds the Shareholders’ 10.0% Return
from inception through the end of the immediately preceding year.  The
Subordinated Incentive Fee shall be paid annually and upon termination of this
Agreement in accordance with Section 4.02, unless such termination is by the
Trust because of a material breach of this Agreement by the Advisor.  If the
Subordinated Incentive Fee is being paid in accordance with the termination of
this Agreement, such fee will be payable with respect to the period between the
end of the immediately preceding year and the Termination Date only if a
Subordinated Incentive Fee was payable with respect to such immediately
preceding year.  If the Subordinated Incentive Fee is payable with respect to
such period between the end of the immediately preceding year and the
Termination Date, such fee will be based on the Trust’s Net Income between the
end of the immediately preceding year and the Termination Date and the
Shareholders’ 10.0% Return from inception through the Termination
Date.  Notwithstanding the foregoing, in the event the Subordinated Incentive
Listing Fee is paid to the Advisor following Listing, no Subordinated Incentive
Fee will be paid to the Advisor.  The Trust, in its sole discretion, may pay the
Subordinated Incentive Fee with an interest bearing promissory note, cash,
Shares, or any combination thereof.  In no event will the Trust pay a
Subordinated Incentive Fee, including any interest payable in connection with
any promissory note issued by the Trust in payment of the Subordinated Incentive
Fee, in excess of the amount that would be presumptively reasonable under
Section 9.7 of the Declaration of Trust.

 
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(e)           Securitized Loan Pool Placement Fees.  Upon the successful
securitization and placement of any Secured Loans (or any derivative thereof),
the Trust shall pay to the Advisor or an Affiliate of the Advisor a Securitized
Loan Pool Placement Fee equal to 2.0% of the net proceeds realized by the Trust
in connection with such securitization and placement, provided that the Advisor
or an Affiliate of the Advisor has provided a substantial amount of services in
connection with such securitization and placement as determined by a majority of
the Independent Trustees.  In no event will the amount of any Securitized Loan
Pool Placement Fees paid in connection with a securitization and placement of
any Secured Loans (or any derivative thereof) exceed the limits set forth in the
NASAA Guidelines and Section 9.6 of the Declaration of Trust.

(f)           Disposition Fees.  If the Advisor or an Affiliate of the Advisor
provides a substantial amount of services, as determined by a majority of the
Independent Trustees, in connection with the Sale of one or more Properties, the
Trust shall pay the Advisor or an Affiliate of the Advisor a Disposition Fee in
an amount equal to 2.0% of the contract sales price of the Property or
Properties.  In no event will the amount of any Disposition Fees paid in
connection with a Sale exceed the limits set forth in the NASAA Guidelines and
Section 9.6 of the Declaration of Trust.

(g)           Subordinated Incentive Listing Fee.  Upon Listing, the Advisor
shall be entitled to the Subordinated Incentive Listing Fee in an amount equal
to 15.0% of the amount by which (i) the Market Value of the Trust’s outstanding
Shares plus Distributions paid by the Trust prior to Listing, exceeds (ii) the
sum of (A) 100% of Invested Capital and (B) the total Distributions required to
be paid to the Shareholders in order to pay the Shareholders’ 10.0% Return from
inception through the date that Market Value is determined.  The Trust shall
have the option to pay such fee in the form of cash, Shares, a promissory note,
or any combination thereof.  If the Trust pays such fee with a promissory note,
interest will accrue at a rate deemed fair and reasonable by the Board from and
after the date of Listing.  If the promissory note has not been paid in full
within five years from the date of Listing, then the Advisor, or its successors
or assigns, may elect to convert the unpaid balance, including accrued but
unpaid interest, into Shares at a price per Share equal to the average closing
price of the Shares over the ten trading days immediately preceding the date of
such election.  If the Shares are no longer Listed at such time as the
promissory note becomes convertible into Shares as provided by this paragraph,
then the price per Share, for purposes of conversion, shall equal the fair
market value for the Shares as determined by the Board based upon the Appraised
Value of the Assets as of the date of election.

3.02         Expenses.

(a)           In addition to the compensation paid to the Advisor pursuant to
Section 3.01 hereof and except as noted in Section 2.08 above, the Trust shall
pay directly or reimburse the Advisor for all of the costs and expenses paid or
incurred by the Advisor that are in any way related to the operations of the
Trust or the business of the Trust or the services the Advisor provides to the
Trust pursuant to this Agreement, including, but not limited to:
 
(i)            Organization and Offering Expenses; provided, however, that
within 60 days after the end of the month in which an Offering terminates, the
Advisor shall reimburse the Trust for any Organization and Offering Expenses
(other than Selling Commissions, bona fide due diligence expense reimbursements,
wholesaling fees, marketing support fees and marketing reallowances) to the
extent that such Organization and Offering Expenses incurred by the Trust exceed
3.0% of the Gross Proceeds raised in the completed Offering;

 
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(ii)           the actual cost of goods, services and materials used by the
Trust and obtained from Persons not affiliated with the Advisor, other than
Acquisition Expenses, including brokerage fees paid in connection with the
purchase and sale of Shares or other securities;
 
(iii)          interest and other costs for borrowed money, including discounts,
points and other similar fees;
 
(iv)          taxes and assessments on income or property and taxes as an
expense of doing business;
 
(v)           costs associated with insurance required in connection with the
business of the Trust or by the Board;
 
(vi)          expenses of managing and operating Assets owned by the Trust,
whether or not payable to an Affiliate of the Advisor;
 
(vii)         all expenses in connection with payments to the Board for
attendance at meetings of the Board and Stockholders;
 
(viii)        except as otherwise limited by the Declaration of Trust, expenses
associated with Listing or with the issuance and distribution of Shares and
other securities of the Trust, such as selling commissions and fees, advertising
expenses, taxes, legal and accounting fees and Listing and registration fees,
but excluding Organization and Offering Expenses;
 
(ix)           expenses connected with payments of Distributions in cash or
otherwise made or caused to be made by the Trust to the Stockholders;
 
(x)            expenses of organizing, reorganizing, liquidating or dissolving
the Trust and the expenses of filing or amending the Declaration of Trust;
 
(xi)           expenses of any third party transfer agent for the Shares and of
maintaining communications with Stockholders, including the cost of preparation,
printing, and mailing annual reports and other Stockholder reports, proxy
statements and other reports required by governmental entities;
 
(xii)          personnel and related employment costs incurred by the Advisor or
its Affiliates in performing the services described herein, including but not
limited to reasonable salaries and wages, benefits and overhead of all employees
directly involved in the performance of such services; provided, 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
 
(xiii)         audit, accounting and legal fees.

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

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

3.04         Reimbursement to the Advisor.  The Trust shall not reimburse the
Advisor, at the end of any fiscal quarter, for any Total Operating Expenses to
the extent that, in the four consecutive fiscal quarters then ended (the
“Expense Year”) the Total Operating Expenses exceed (the “Excess Amount”) the
greater of (i) 2% of Average Invested Assets or (ii) 25% of Net Income (the
“2%/25% Guidelines”) for that period of four consecutive quarters unless the
Independent Trustees determine that such excess was justified, based on unusual
and nonrecurring factors which the Independent Trustees deem sufficient.  If the
Independent Trustees do not approve such excess as being so justified, any
Excess Amount paid to the Advisor during a fiscal quarter shall be repaid to the
Trust.  If the Independent Trustees determine such excess was justified, then
within 60 days after the end of any fiscal quarter of the Trust for
which  reimbursed Total Operating Expenses for the Expense Year exceed the
2%/25% Guidelines, the Advisor, at the direction of the Independent Trustees,
shall cause such fact to be disclosed in the next quarterly report of the Trust
or in a separate writing and sent to the shareholders, together with an
explanation of the factors the Independent Trustees considered in determining
that such excess expenses were justified.  The Trust will ensure that such
determination will be reflected in the minutes of the meetings of the
Board.  All figures used in the foregoing computation shall be determined in
accordance with generally accepted accounting principles applied on a consistent
basis.  In addition, the Trust shall not reimburse the Advisor or its Affiliates
for services for which the Advisor and/or its Affiliates are entitled to
compensation in the form of a separate fee.

ARTICLE IV

TERM AND TERMINATION

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

4.02         Termination.  This Agreement will automatically terminate upon
Listing.  This Agreement also may be terminated at the option of either party
(i) immediately upon a Change of Control or (ii) upon 60 days written notice
without cause or penalty (in either case, if termination is by the Trust, then
such termination shall be upon the approval of a majority of the Independent
Trustees).  Notwithstanding the foregoing, the provisions of this Agreement
which provide for payment to the Advisor of expenses, fees or other compensation
following the Termination Date (i.e., Section 4.03) shall continue in full force
and effect until all amounts payable thereunder to the Advisor are paid in
full.  The provisions of Sections 4.03 through 5.02 shall survive the
termination of this Agreement.

 
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4.03         Payments to and Duties of Advisor upon Termination.

(a)           After the Termination Date, the Advisor shall not be entitled to
compensation for further services hereunder, except it shall be entitled to and
receive from the Trust within 30 days after the effective date of such
termination all unpaid reimbursements of expenses provided for herein, subject
to the provisions of Section 3.04 hereof, and all contingent liabilities related
to fees payable to the Advisor prior to termination of this Agreement, provided
that the Subordinated Incentive Fee, if any, shall be paid in accordance with
the provisions of Section 3.01(d) and the Subordinated Incentive Listing Fee, if
any, shall be paid in accordance with the provisions of Section 3.01(g).

(b)            The Advisor shall promptly upon termination:

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

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

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

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

ARTICLE V

INDEMNIFICATION

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

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

(c)           Notwithstanding the provisions of this Section 5.01, the Advisor
shall not be entitled to indemnification or be held harmless pursuant to this
Section 5.01 for any activity which the Advisor shall be required to indemnify
or hold harmless the Trust pursuant to Section 5.02.

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

ARTICLE VI

MISCELLANEOUS

6.01         Assignment to an Affiliate.  This Agreement and any rights, duties,
liabilities and obligations hereunder and the fees and compensation related
thereto may be assigned by the Advisor, in whole or in part, to a duly qualified
and licensed Affiliate of the Advisor without obtaining approval of the
Board.  The Advisor may assign any rights to receive fees or other payments
under this Agreement without obtaining the approval of the Board.  Any other
assignment shall be made only with the approval of a majority of the Board
(including a majority of the Independent Trustees).  This Agreement shall not be
assigned by the Trust without the consent of the Advisor, except in the case of
an assignment by the Trust to a corporation or other organization which is a
successor to all of the assets, rights and obligations of the Trust, in which
case such successor organization shall be bound hereunder and by the terms of
said assignment in the same manner as the Trust is bound by this
Agreement.  This Agreement shall be binding on successors to the Trust resulting
from a Change of Control or sale of all or substantially all the assets of the
Trust or the Partnership, and shall likewise be binding upon any successor to
the Advisor.

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

6.03         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 Declaration
of Trust, the Bylaws, or accepted by the party to whom it is given, and shall be
given by being delivered by hand or by overnight mail or other overnight
delivery service to the addresses set forth herein:

To the Trustees and to the Trust:
 
United Development Funding IV
The United Development Funding Building
Suite 100
1301 Municipal Way
Grapevine, Texas  76051
Attention:  Chief Executive Officer
 
To the Advisor:
 
UMTH General Services, L.P.
The United Development Funding Building
Suite 100
1301 Municipal Way
Grapevine, Texas  76051
Attention:  President

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

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

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

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

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

6.08         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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6.09          Gender; Number.  Words used herein regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context requires.

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

6.11         Execution in Counterparts.  This Agreement may be executed 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.  This Agreement shall become
binding when the counterparts hereof, individually or taken together, shall bear
the signatures of all of the parties reflected hereon as the signatories.

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

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

 
UNITED DEVELOPMENT FUNDING IV
             
By: 
/s/ Hollis M. Greenlaw
 
Name: 
Hollis M. Greenlaw
 
Title: 
Chief Executive Officer
             
UMTH GENERAL SERVICES, L.P.
             
By: 
/s/ David Hanson
 
Name: 
David Hanson
 
Title: 
President

 
 
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