Moody National REIT II, Inc.- 8-K


Exhibit 10.1


 





 



 





 



 


AMENDED AND RESTATED ADVISORY AGREEMENT


 


AMONG


 


MOODY NATIONAL REIT II, INC.,


 


MOODY NATIONAL OPERATING PARTNERSHIP
II, LP,


 


AND


 


MOODY NATIONAL ADVISOR II, LLC


 





 



 




    


     


    

 


TABLE OF CONTENTS


 







	1.	DEFINITIONS	2
	2.	APPOINTMENT	8
	3.	DUTIES OF THE ADVISOR	8
	4.	AUTHORITY OF ADVISOR	10
	5.	BANK ACCOUNTS	10
	6.	RECORDS; ACCESS	11
	7.	LIMITATIONS ON ACTIVITIES	11
	8.	RELATIONSHIP WITH DIRECTORS	11
	9.	FEES	11
	10.	EXPENSES	13
	11.	OTHER SERVICES	15
	12.	REIMBURSEMENT TO THE ADVISOR	15
	13.	RELATIONSHIP OF THE PARTIES	15
	14.	OTHER ACTIVITIES OF THE ADVISOR	15
	15.	TERM OF AGREEMENT	16
	16.	TERMINATION BY THE PARTIES	16
	17.	ASSIGNMENT TO AN AFFILIATE	16
	18.	PAYMENTS TO AND DUTIES OF ADVISOR UPON TERMINATION	16
	19.	INDEMNIFICATION BY THE COMPANY AND THE OPERATING PARTNERSHIP	17
	20.	INDEMNIFICATION BY ADVISOR	18
	21.	EXCLUSION OF CERTAIN TRANSACTIONS	18
	22.	NON-SOLICITATION	18
	23.	NOTICES	18
	24.	MODIFICATION	19
	25.	SEVERABILITY	19





	26.	CONSTRUCTION	19
	27.	ENTIRE AGREEMENT	19
	28.	INDULGENCES, NOT WAIVERS	19
	29.	GENDER	20
	30.	TITLES NOT TO AFFECT INTERPRETATION	20
	31.	EXECUTION IN COUNTERPARTS	20
	32.	EFFECTIVENESS OF AGREEMENT	20






  






    


     


    

  


AMENDED AND RESTATED ADVISORY AGREEMENT


 


THIS AMENDED AND RESTATED
ADVISORY AGREEMENT, dated as of the 16th day of November, 2016 (this “Agreement”), is entered into by and among
Moody National REIT II, Inc., a Maryland corporation (the “Company”), Moody National Operating Partnership II,
LP, a Delaware limited partnership (the “Operating Partnership”), and Moody National Advisor II, LLC, a Delaware
limited liability company (the “Advisor,” and collectively with the Company and the Operating Partnership, the
“Parties”). Capitalized terms used herein shall have the meanings ascribed to them in Section 1 below.


 


W I T N E S S E T H


 


WHEREAS, the Company
intends to qualify as a REIT, and to invest its funds in investments permitted by the terms of Sections 856 through 860 of the
Code;


 


WHEREAS, the Company
is the general partner of the Operating Partnership and intends to conduct all of its business and make all Investments through
the Operating Partnership;


 


WHEREAS, the Company
is a party to that certain agreement and plan of merger, dated as of November 16, 2016 (as the same may be amended from time to
time, the “Merger Agreement”), by and among the Company, the Operating Partnership, Moody Merger Sub, LLC (“Merger
Sub”), Moody National REIT I, Inc. (“REIT I”) and Moody National Operating Partnership I, LP (“REIT
I Operating Partnership”);


 


WHEREAS, pursuant to
the Merger Agreement and subject to the terms and conditions therein, upon the time that the Merger (defined below) becomes effective
(the “Merger Effective Time”), (i) REIT I will be merged with and into Merger Sub, with Merger Sub being the
surviving entity and a wholly owned subsidiary of the Company and (ii) REIT I Operating Partnership will be merged with the Operating
Partnership, with the Operating Partnership being the surviving entity (the foregoing merger transactions together, the “Merger”);


 


WHEREAS, the Company,
the Operating Partnership and the Advisor are parties to that certain Advisory Agreement, dated as of the 12th day of
January, 2015 (the “Original Agreement”);


 


WHEREAS, pursuant to
the terms of the Merger Agreement, the Parties desire to amend and restate the Original Agreement pursuant to the terms hereof;


 


WHEREAS, this Agreement
will become effective in accordance with Section 32 hereof;


 


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, 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, the Parties hereto, intending to be
legally bound, hereby agree as follows:


 


1.       DEFINITIONS.
 As used in this Agreement, the following terms have the definitions hereinafter indicated:


 


Acquisition Expenses.
Any and all expenses, exclusive of Acquisition Fees and Financing Coordination Fees, 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 Investments, whether or not acquired or originated, 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 the costs of performing due diligence.


 


Acquisition Fees.
Any and all fees and commissions, exclusive of Acquisition Expenses, paid by any Person to any other Person (including any fees
or commissions paid by or to any Affiliate of the Company, the Operating Partnership or the Advisor) in connection with making
or investing in any Investment or the purchase, development or construction of any Real Estate Asset, including real estate commissions,
selection fees, development fees, construction fees, nonrecurring management fees, loan fees, points or any other fees of a similar
nature. Excluded shall be development fees and construction fees paid to any Person not Affiliated with the Sponsor in connection
with the actual development and construction of a project.


 


Advisor.
Moody National Advisor II, LLC, a Delaware limited liability company, any successor advisor to the Company, the Operating Partnership
or any Person to which Moody National Advisor II, LLC or any successor advisor subcontracts substantially all of its functions.
Notwithstanding the foregoing, a Person hired or retained by Moody National Advisor II, LLC to perform hotel 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 Moody National Advisor II, LLC with respect to the Company or the Operating Partnership as a whole shall not be deemed to be
an Advisor.


 


Affiliate or
Affiliated. With respect to any Person, (i) any 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 other Person; (ii) any 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 other Person; (iii) any Person directly or indirectly controlling, controlled by or under common control with such other
Person; (iv) any executive officer, director, trustee or general partner of such other Person; and (v) any legal entity for which
such Person acts as an executive officer, director, trustee or general partner of such other Person.


 


Articles of Incorporation.
The Articles of Incorporation of the Company, as amended from time to time.


 


Asset Management
Fee. The term “Asset Management Fee” shall mean the fee payable to the Advisor pursuant to Section 9(d).


 


Average Invested
Assets. For a specified period, the average of the aggregate book value of the assets of the Company invested, directly
or indirectly, in Investments before deducting depreciation, bad debts or other non-cash reserves, computed by taking the average
of such values at the end of each month during such period.


 


Board.
The board of directors of the Company, as of any particular time.


 






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


 


Cause.
With respect to the termination of this Agreement, fraud, criminal conduct, misconduct or negligent breach of fiduciary duty by
the Advisor, or a material breach of this Agreement by the Advisor.


 


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


 


Company.
The term “Company” shall have the meaning set forth in the preamble of this Agreement.


 


Competitive Brokerage
Commission. The term “Competitive Brokerage Commission” means a real estate or brokerage commission for the
purchase or sale of a Property, Loan or Permitted Investment that is reasonable, customary, and competitive in light of the size,
type, and location of the Property, Loan or Permitted Investment.


 


Contract Sales
Price. The total consideration received by the Company for the sale of an Investment.


 


Dealer Manager.
Moody Securities, LLC, or such other Person or entity selected by the Board to act as the dealer manager for the Offering. Moody
Securities, LLC is a member of the Financial Industry Regulatory Authority.


 


Dealer Manager
Fee. 3.0% of Gross Proceeds from the sale of Shares in the Primary Offering, payable to the Dealer Manager for serving
as the dealer manager of such Offering.


 


Director.
A member of the Board.


 


Disposition Fees.
The term “Dispositions Fees” shall mean the fees payable to the Advisor pursuant to Section 9(c).


 


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


 


Effective Date.
The commencement date of the Initial Public Offering.


 


Excess Amount.
The term “Excess Amount” shall have the meaning set forth in Section 12.


 


Expense Year.
The term “Expense Year” shall have the meaning set forth in Section 12.


 


Financing Coordination
Fees. The term “Financing Coordination Fees” shall mean the fees payable to the Advisor pursuant to Section
9(e).


 


GAAP.
Generally accepted accounting principles as in effect in the United States of America from time to time.


 


Good Reason.
With respect to the termination of this Agreement, (i) any failure to obtain a satisfactory agreement from any successor to the
Company or the Operating Partnership to assume and agree to perform the Company’s or the Operating Partnership’s obligations
under this Agreement; or (ii) any material breach of this Agreement of any nature whatsoever by the Company or the Operating Partnership.


 






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Gross Proceeds.
The aggregate purchase price of all Shares sold for the account of the Company through all Offerings, without deduction for Sales
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 Sales Commissions are paid to the
Dealer Manager or a Soliciting Dealer (where net proceeds to the Company are not reduced) shall be deemed to be the full amount
of the offering price per Share pursuant to the Prospectus for such Offering without reduction.


 


Indemnitee.
The terms “Indemnitee and “Indemnitees” shall have the meaning set forth in Section 19 herein.


 


Independent Director.
The term “Independent Director” shall have the meaning set forth in the Articles of Incorporation.


 


Initial Public
Offering. The initial public offering of Shares registered pursuant to the Registration Statement.


 


Investments.
Any investments by the Company or the Operating Partnership in Real Estate Assets and Securities and Debt-Related Investments.


 


Joint Ventures.
The joint venture or partnership arrangements (other than with the Operating Partnership) in which the Company or any of its subsidiaries
is a co-venturer or general partner which are established to acquire Real Properties.


 


Listing.
The listing of the Shares on a national securities exchange or the receipt by the Company’s Stockholders of securities that
are listed on a national securities exchange in exchange for the Company’s common stock. Upon such Listing, the Shares shall
be deemed Listed.


 


Loans.
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.


 


Merger.
The term “Merger” shall have the meaning set forth in the Recitals hereto.


 


Merger Agreement.
The term “Merger Agreement” shall have the meaning set forth in the Recitals hereto.


 


Merger Disposition
Fee. The fee payable to Moody National Advisor I, LLC (“REIT I Advisor”) pursuant to Section 1.1 of
that certain Termination Agreement by and among REIT I, REIT I Operating Partnership, REIT I Advisor, Moody National Realty, L.P.,
Moody National LPOP I, LLC and the Company.


 


Merger Effective
Time. The term “Merger Effective Time” shall have the meaning set forth in the Recitals hereto.


 


Merger Sub.
The term “Merger Sub” shall have the meaning set forth in the Recitals hereto.


 






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NASAA REIT Guidelines.
The Statement of Policy Regarding Real Estate Investment Trusts published by the North American Securities Administrators Association
as in effect on the Effective Date, as may be modified from time to time.


 


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


 


Offering.
The public offering of Shares pursuant to a Prospectus.


 


Operating Partnership.
The term “Operating Partnership” shall have the meaning set forth in the preamble of this Agreement.


 


Operating Partnership
Agreement. The Amended and Restated Limited Partnership Agreement of Moody National Operating Partnership II, LP.


 


OP Limited Partnership
Interests. Limited partnership interests in the Operating Partnership.


 


Organization
and Offering Expenses. Organization and Offering Expenses means all expenses incurred by or on behalf of the Company in
connection with and in preparing the Company for registration of and subsequently offering and distributing its Shares to the public,
whether incurred before or after the date of this Agreement, which may include but are not limited to, total underwriting and brokerage
discounts and commissions (including fees of the underwriters’ attorneys); any expense allowance granted by the Company to
the underwriter or any reimbursement of expenses of the underwriter by the Company; expenses for printing, engraving and mailing;
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 expenses of qualification of the sale of the securities under Federal and State laws,
including taxes and fees, accountants’ and attorneys’ fees.


 


Original Agreement.
The term “Original Agreement” shall have the meaning set forth in the Recitals hereto.


 


Person.
An individual, corporation, partnership, trust, joint venture, limited liability company or other entity.


 


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


 


Property Manager.
An Affiliated entity that has been retained to perform and carry out property-management services at one or more of the Real Estate
Assets.


 


Prospectus.
A “Prospectus” under Section 2(10) of the Securities Act of 1933, as amended (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 to the public.


 






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Real Estate Assets.
Any investments by the Company or the Operating Partnership in unimproved and improved Real Property (including, without limitation,
fee or leasehold interests, options and leases) either directly or through a Joint Venture.


 


Real Property.
Real property owned from time to time by the Company or the Operating Partnership, either directly or through joint venture arrangements
or other partnerships which consists of (i) land only, (ii) land, including the buildings located thereon, (iii) buildings only
or (iv) such investments the Board and the Advisor mutually designate as Real Property to the extent such investments could be
classified as Real Property.


 


Registration
Statement. Registration Statement shall mean the Company’s registration statement on Form S-11 (Registration Number
333-198305), as amended from time to time, in connection with the Initial Public Offering.


 


REIT.
A “real estate investment trust” under Sections 856 through 860 of the Code or as may be amended.


 


REIT I.
The term “REIT I” shall have the meaning set forth in the Recitals hereto.


 


REIT I Operating
Partnership. The term “REIT I Operating Partnership” shall have the meaning set forth in the Recitals hereto.


 


REIT I Property.
Any property including, but not limited to (i) land, (ii) land including the buildings located thereon, (iii) buildings only and
(iv) such investments the Board and the Advisor mutually deem to be REIT I Property, in each case that (A) was owned by REIT I
immediately prior to the Merger Effective Time and (B) is subject to a Sale during the period beginning on the date on which the
Merger Effective Time occurs and ending on the date that is one (1) year following the date on which the Merger Effective Time
occurs.


 


REIT I Property
Merger Disposition Fee. The portion of the Merger Disposition Fee allocable to a REIT I Property, determined in accordance
with Schedule I, attached hereto.


 


Sale or Sales.
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 ownership of any Real
Property or portion thereof, including the lease of any Real Property consisting of a building only, and including any event with
respect to any Real Property which 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 of the interest of the Corporation or the Operating
Partnership in any Joint Venture in which it is a co-venturer 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 or partner
sells, grants, transfers, conveys, or relinquishes its ownership of any Real Property or portion thereof, including any event with
respect to any Real Property 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 interest in any Securities and Debt-Related Investment or portion thereof (including with respect to any 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 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.


 






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Sales Commission.
7.0% of Gross Proceeds from the sale of Shares in the Primary Offering payable to the Dealer Manager and reallowable to Soliciting
Dealers with respect to Shares sold by them.


 


Securities and
Debt-Related Investments. Any investments by the Company or the Operating Partnership in (i) real estate securities such
as common stocks, preferred stocks and options to acquire stock in REITs and other real estate companies and (ii) debt-related
investments such as (a) mortgage, mezzanine, bridge and other loans and (b) debt and derivative securities related to real estate
assets including mortgage-backed securities, collateralized debt obligations, debt securities issued by real estate companies and
credit default swaps.


 


Shares.
The shares of the Company’s common stock, par value $0.01 per share.


 


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


 


Special OP Limited
Partnership Interests. Special OP Limited Partnership Interests means the separate series of limited partnership interests
to be issued in accordance with Section 9(g).


 


Sponsor.
Any Person which (i) is directly or indirectly instrumental in organizing, wholly or in part, the Company, (ii) will control, manage
or participate in the management of the Company, and any Affiliate of any such Person, (iii) takes the initiative, directly or
indirectly, in founding or organizing the Company, either alone or in conjunction with one or more other Persons, (iv) receives
a material participation in the Company in connection with the founding or organizing of the business of the Company, in consideration
of services or property, or both services and property, (v) has a substantial number of relationships and contacts with the Company,
(vi) possesses significant rights to control the Company’s Investments, (vii) receives fees for providing services to the
Company which are paid on a basis that is not customary in the industry, or (viii) provides goods or services to the Company on
a basis which was not negotiated at arm’s-length with the Company. “Sponsor” does not include wholly independent
third parties such as attorneys, accountants and underwriters whose only compensation is for professional services.


 


Stockholders.
The registered holders of the Shares.


 


Termination Date.
The date of termination of this Agreement.


 


Termination Event.
The termination or nonrenewal of this Agreement (i) in connection with a merger, sale of assets or transaction involving the Company
pursuant to which a majority of the Directors then in office are replaced or removed, (ii) by the Advisor for Good Reason or (iii)
by the Company and the Operating Partnership other than for Cause.


 






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Total Operating
Expenses. All costs and expenses paid or incurred by the Company, as determined under GAAP, that are in any way related
to the operation of the Company or its business, including asset management fees and other fees paid to Advisors, 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 taxes incurred in connection with the issuance, distribution,
transfer, registration and Listing, (ii) interest payments, (iii) taxes, (iv) non-cash expenditures such as depreciation, amortization
and bad debt reserves, (v) incentive fees paid in compliance with the NASAA REIT Guidelines; (vi) Acquisition Fees and Acquisition
Expenses, (vii) real estate commissions on the Sale of Real Property, and (viii) other fees and expenses connected with the acquisition,
disposition, management and ownership of real estate interests, mortgages or other property (including the costs of foreclosure,
insurance premiums, legal services, maintenance, repair, and improvement of property). The definition of “Total Operating
Expenses” set forth above is intended to encompass only those expenses which are required to be treated as Total Operating
Expenses under the NASAA REIT Guidelines. As a result, and notwithstanding the definition set forth above, any expense of the Company
which is not part of Total Operating Expenses under the NASAA REIT Guidelines shall not be treated as part of Total Operating Expenses
for purposes hereof.


 


2%/25% Guidelines.
The term “2%/25% Guidelines” shall have the meaning set forth in Section 12.


  


2.       APPOINTMENT.
The Company and the Operating Partnership hereby appoint the Advisor to serve as their advisor on the terms and conditions set
forth in this Agreement, and the Advisor hereby accepts such appointment.


  


3.       DUTIES
OF THE ADVISOR. The Advisor undertakes to use its 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 by the Directors, and as amended from time to time with the approval of
the Stockholders. In performance of this undertaking, subject to the supervision of the Directors and consistent with the provisions
of the Articles of Incorporation and Bylaws of the Company and the Operating Partnership Agreement, the Advisor shall, either
directly or by engaging an Affiliate:


 


(a)       assist
in the development of the Initial Public Offering and any subsequent Offering approved by the Board, including the determination
of the specific terms of the securities to be offered by the Company, preparation of all offering and related documents, and obtaining
all required regulatory approvals of such documents;


 


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


 


(c)       provide
the daily management for the Company and the Operating Partnership and perform and supervise the various administrative functions
reasonably necessary for the management of the Company and the Operating Partnership;


 


(d)       investigate,
select, and, on behalf of the Company and the Operating Partnership, 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, real estate management
companies, real estate operating companies, securities investment advisors, mortgagors, and any and all agents for any of the foregoing,
including Affiliates of the Advisor, and Persons acting in any other capacity deemed by the Advisor necessary or desirable for
the performance of any of the foregoing services, including, but not limited to, entering into contracts in the name of the Company
and the Operating Partnership with any of the foregoing;


 






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(e)      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 Directors 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;


 


(f)       subject
to the provisions of Section 4 hereof, (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 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; (vii) select Joint Venture partners, structure corresponding agreements
and oversee and monitor these relationships; (viii) oversee the performance of the Property Manager or third-party property managers
who perform services for the Company or the Operating Partnership; (ix) oversee Affiliated and non-Affiliated Persons with whom
the Advisor contracts to perform certain of the services required to be performed under this Agreement; (x) manage accounting and
other record-keeping functions for the Company and the Operating Partnership; and (xi) recommend various liquidity events to the
Board when appropriate;


 


(g)      upon
request, provide the Directors with periodic reports regarding prospective investments;


 


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


 


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


 


(j)       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;


 


(k)      from
time to time, or at any time reasonably requested by the Directors, make reports to the Directors 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;


 


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


 






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


 


(n)       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;


 


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


 


(p)       effect
any private placement of OP Limited Partnership Interests, tenancy-in-common or other interests in Investments as may be approved
by the Board.


 


Notwithstanding the foregoing, the Advisor
may delegate any of the foregoing duties to any Person so long as the Advisor or any 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 7), and subject to the continuing
and exclusive authority of the Board over the management of the Company, the Board hereby delegates to the Advisor the authority
to perform the services described in Section 3.


 


(b)       Notwithstanding
the foregoing, any investment in Investments, including any financing of such Investment will require the prior approval of the
Board. The Advisor will deliver to the Board all documents and other information required by the Board or any committee of the
Board, as the case may be, to evaluate a proposed Investment (and any financing related to such proposed investment).


 


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


 


(d)       The
prior approval of a majority of the Independent Directors not otherwise interested in the transaction and a majority of the Directors
not otherwise interested in the transaction will be required for each transaction to which the Advisor or its Affiliates is a party.


 


(e)       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.      BANK
ACCOUNTS. The Advisor may establish and maintain one or more bank accounts in its own name for the account of the Company
or the Operating Partnership or in the name of the Company and 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 Directors may approve, provided that no funds shall be commingled with the
funds of the Advisor; and the Advisor shall from time to time render appropriate accountings of such collections and payments
to the Directors and to the auditors of the Company.


 






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6.       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 or from time to time during
normal business hours. The Advisor shall at all reasonable times have access to the books and records of the Company and the Operating
Partnership.


  


7.       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 ability of the Company to qualify or continue
to qualify as a REIT under the Code unless the Board has determined that the Company will not seek or maintain REIT qualification,
(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 or its Shares, or otherwise not
be permitted by the Articles of Incorporation or Bylaws of the Company, 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, employees and members, and partners, directors, officers, members and stockholders
of the Advisor’s Affiliates shall not be liable to the Company or to the Directors or Stockholders for any act or omission
by the Advisor, its directors, officers, employees, or members, and partners, directors, officers, members or stockholders of
the Advisor’s Affiliates taken or omitted to be taken in the performance of their duties under this Agreement except as
provided in Section 19 of this Agreement.


  


8.       RELATIONSHIP
WITH DIRECTORS. Subject to Section 7 of this Agreement and to restrictions advisable with respect to the qualification of
the Company as a REIT, directors, officers and employees of the Advisor or an Affiliate of the Advisor or any corporate parents
of an Affiliate, may serve as a Director and as officers of the Company, except that no director, officer or employee of the Advisor
or its Affiliates who also is a Director or officer of the Company shall receive any compensation from the Company for serving
as a Director or officer other than reasonable reimbursement for travel and related expenses incurred in attending meetings of
the Directors and no such Director shall be deemed an Independent Director for purposes of satisfying the Director independence
requirement set forth in the Articles of Incorporation.


 


9.       FEES.


 


 (a)       Acquisition
Fees. The Advisor shall receive an Acquisition Fee payable by the Company as compensation for services rendered in connection
with the investigation, selection and acquisition (by purchase, investment, exchange, sourcing or origination) of Investments.
The total Acquisition Fees payable to the Advisor or its Affiliates shall equal 1.5% of (i) the cost of all Investments, including
Acquisition Expenses and any debt attributed to such Investments and excluding Acquisition Fees and Financing Coordination Fees,
or (ii) the amount funded by the Company to acquire or originate a Loan, including Acquisition Expenses related to such Investments
and any debt used to fund the acquisition or origination of a Loan and excluding Acquisition Fees and Financing Coordination Fees.
With respect to the acquisition of Real Estate Assets through a Joint Venture, the Acquisition Fee payable by the Company to the
Advisor shall equal 1.5% of the Company’s allocable cost of such Real Estate Assets, including Acquisition Expenses and any
debt attributed to such Investments and excluding Acquisition Fees and Financing Coordination Fees. Once the proceeds from the
Primary Offering have been fully invested, the aggregate amount of Acquisition Fees and Financing Coordination Fees shall not exceed
1.9% of the Contract Sales Price and the amount advanced for a Loan or other Investment for all the assets acquired. The Advisor
shall submit an invoice to the Company following the closing or closings of each Investment, accompanied by a computation of the
Acquisition Fee. The Acquisition Fee payable to the Advisor shall be paid at the closing of the transaction upon receipt of the
invoice by the Company.


 






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With respect to and upon
the effectiveness of the Merger, the Advisor shall be entitled to receive an Acquisition Fee payable by the Company equal to 1.5%
of the aggregate Cash Consideration (as such term is defined in the Merger Agreement) paid to stockholders of REIT I in the Merger.
For the avoidance of doubt, the Acquisition Fee as described in the preceding sentence shall be the only Acquisition Fee to which
the Advisor is entitled with respect to the Merger, and the Advisor hereby waives any rights it may have under the Original Agreement
to collect any other Acquisition Fee in connection with the Merger.


 


(b)       Limitation
on Total Acquisition Fees, Financing Coordination Fees and Acquisition Expenses. Pursuant to the NASAA REIT Guidelines,
the total of all Acquisition Fees, Acquisition Expenses and Financing Coordination Fees shall not exceed 6.0% of the “contract
purchase price,” as defined in the Articles of Incorporation, of all Investments acquired.


 


(c)       Disposition
Fees. If the Advisor provides a substantial amount of services, as determined by the Independent Directors in connection
with a Sale, the Company shall pay a Disposition Fee to the Advisor equal to the lesser of (i)(a) where a brokerage commission
is also payable to a third party, one-half of the aggregate brokerage commission paid, including brokerage commissions payable
to third parties, or (b) where no brokerage commission is payable to any third party, the Competitive Brokerage Commission or (ii)
3.0% of the Contract Sales Price. With respect to a Property held in a Joint Venture, the Disposition Fee will be equal to the
percentage of the “contract purchase price” reflecting the Company’s economic interest in the Joint Venture.
Any Disposition Fee payable under this Section 9(c) may be paid in addition to real estate commissions paid to non-Affiliates,
provided that the total real estate commissions (including such Disposition Fee) paid to all Persons by the Company for each Investment
shall not exceed 6.0% of the Contract Sales Price.


 


Notwithstanding anything
herein to the contrary, Advisor shall only be entitled to a Disposition Fee with respect to the Sale of any REIT I Property to
the extent of the excess of (i) the Disposition Fee attributable to such REIT I Property calculated in accordance with this Section
9(c) over (ii) the REIT I Property Merger Disposition Fee applicable to such REIT I Property.


 


(d)       Asset
Management Fee. The Advisor shall receive the Asset Management Fee as compensation for services rendered pursuant to Section
3 of this Agreement in connection with the management of the Company’s assets. The Asset Management Fee shall be calculated
monthly and consists of a monthly fee of one-twelfth of 1.0% of the aggregate cost (before non-cash reserves and depreciation)
of all Investments the Company owns, including Acquisition Fees, Acquisition Expenses and any debt attributable to such Investments.
With the exception of any portion of the Asset Management Fee related to the disposition of Investments, which shall be payable
at the time of such disposition, the Asset Management Fee shall be payable on the first of each month.


 


(e)       Financing
Coordination Fees. The Advisor shall receive a Financing Coordination Fee as compensation for services rendered in connection
with the coordination of debt financing obtained by the Company. The total Financing Coordination Fee payable to the Advisor or
its Affiliates shall equal (i) 1.0% of the amount available under any loan or line of credit originated or assumed, directly or
indirectly, in connection with the acquisition of Real Properties or other permitted Investments, by the Company, and will be in
addition to the Acquisition Fees paid to the Advisor; (ii) 0.75% of the amount available or outstanding under any refinanced loan
or line of credit of the Company, and will be in addition to the Acquisition Fees paid to the Advisor; or (iii) 0.75% of the Company’s
proportionate share of the amount available or outstanding under any refinanced loan or line of credit in the case of Investments
made through a Joint Venture, and will be in addition to the Acquisition Fees paid to the Advisor. Financing Coordination Fees
will only be payable if the Advisor or its Affiliates provides services in connection with the origination, assumption or refinancing
of debt that the Company uses to acquire Real Properties or other permitted Investments. The Advisor may pay some or all of the
Financing Coordination Fee to third parties if the Advisor subcontracts with such third parties to coordinate financing obtained
by the Company. The Advisor shall submit an invoice to the Company following the closing or closings of each debt financing or
refinancing obtained by the Company, accompanied by a computation of the Financing Coordination Fee. The Financing Coordination
Fee payable to the Advisor shall be paid at the closing of the debt financing upon receipt of the invoice by the Company.


 






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(f)       Special
Limited Partnership Interests. In addition, an Affiliate of the Advisor has made a capital contribution of $1,000 to the
Operating Partnership in exchange for Special Limited Partnership Interests. The Special Limited Partnership Interests shall be
entitled to the distributions provided for, and shall be subject to redemption by the Operating Partnership, in accordance with
the terms of the Operating Partnership Agreement. To the extent distributions to the Special Limited Partnership Interests are
not paid from net sales proceeds, such amounts will count against the limit on Total Operating Expenses set forth in the Articles
of Incorporation.


 


10.    EXPENSES.


 


(a)       In
addition to the fees paid to the Advisor pursuant to Section 9 hereof and subject to the limitations set forth in the Articles
of Incorporation, the Company or the Operating Partnership shall pay directly or reimburse the Advisor for all of the expenses
paid or incurred by the Advisor in connection with the services it provides to the Company and the Operating Partnership pursuant
to this Agreement, including, but not limited to:


 


(i)       Organizational
and Offering Expenses; provided, however, that (1) the Company shall not reimburse the Advisor to the extent such reimbursement
would cause the total amount of Organization and Offering Expenses attributable to the Initial Public Offering paid by the Company
and the Operating Partnership to exceed 15.0% of the Gross Proceeds from the Initial Public Offering raised as of the date of the
reimbursement; (2) within 60 days after the end of the month in which the current Offering terminates, the Advisor shall reimburse
the Company to the extent the Organizational and Offering Expenses borne by the Company exceed 15% of the Gross Proceeds raised
in the completed Offering; and (3) the Company shall not reimburse the Advisor for any Organization and Offering Expenses that
the Independent Directors determine are not fair and commercially reasonable to the Company.


 


(ii)       Acquisition
Expenses incurred in connection with the selection and acquisition of Investments subject to the aggregate 6.0% cap on Acquisition
Fees, Acquisition Expenses and Financing Coordination Fees set forth in Section 9(b);


 


(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 borrowed money, including discounts, points and other similar fees;


 






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(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 Directors;


 


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


 


(viii)    all
expenses in connection with payments to the Directors for attending meetings of the Directors 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, and other Organization and Offering Expenses;


 


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


 


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


 


(xii)     expenses
of 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 (a) personnel costs; provided, however, that no reimbursement shall be made for costs of personnel
to the extent that such personnel perform services in transactions for which the Advisor receives Acquisition Fees, Financing Coordination
Fees, Asset Management Fees, hotel management fees or real estate sales commissions, and (b) the Company’s allocable share
of other overhead of the Advisor such as rent and utilities); and


 


(xiv)    audit,
accounting and legal fees and other fees for professional services relating to the operations of the Company and all such fees
incurred at the request, or on behalf of, the Board or any committee of the Board;


 


(xv)     out-of-pocket
costs for the Company to comply with all applicable laws, regulations and ordinances, including without limitation, the Sarbanes-Oxley
Act of 2002, as amended; and


 


(xvi)    all
other out-of-pocket costs incurred by the Advisor in performing its duties hereunder.


 


(b)       Expenses
incurred by the Advisor on behalf of the Company and the Operating Partnership and payable pursuant to this Section 10 shall be
reimbursed no less than monthly to the Advisor. The Advisor shall prepare a statement documenting the expenses of the Company and
the Operating Partnership and the calculation of the Asset Management Fee during each quarter, and shall deliver such statement
to the Company and the Operating Partnership within 45 days after the end of each quarter.


 



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11.       OTHER
SERVICES. Should the Directors 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
rates and in such amounts as are agreed by the Advisor and the Independent Directors, subject to the limitations contained in
the Articles of Incorporation, and shall not be deemed to be services pursuant to the terms of this Agreement.


  


12.       REIMBURSEMENT
TO THE ADVISOR.  The Company may reimburse the Advisor, at the end of each fiscal quarter, for Total Operating Expenses incurred
by the Advisor; provided, however, that the Company shall not reimburse the Advisor at the end of any fiscal quarter commencing
on the fourth fiscal quarter after the quarter in which the Corporation makes its first investment in an Asset, for Total Operating
Expenses that, in the four consecutive fiscal quarters then ended, exceed the greater of two percent of Average Invested Assets
or 25% of Net Income (the “2%/25% Guidelines”) for such 12-month period. Any Excess Amount paid to the Advisor during
a fiscal quarter shall be repaid to the Company or, at the option of the Company, subtracted from the Total Operating Expenses
reimbursed during the subsequent fiscal quarter. If there is an Excess Amount in any Expense Year and the Independent Directors
determine that such excess was justified based on unusual and nonrecurring factors which they deem sufficient, then the Excess
Amount may be carried over and included in Total Operating Expenses in subsequent Expense Years and reimbursed to the Advisor
in one or more of such years, provided that there shall be sent to the Stockholders a written disclosure of such fact, together
with an explanation of the factors the Independent Directors considered in determining that such excess expenses were justified.
Such determination shall be reflected in the minutes of the meetings of the Board. The Company will not reimburse the Advisor
or its Affiliates for services for which the Advisor or its Affiliates are entitled to receive Acquisition Fees, Financing Coordination
Fees, Asset Management Fees, hotel management fees or real estate commissions. All figures used in the foregoing computation shall
be determined in accordance with generally accepted accounting principles applied on a consistent basis.


 


13.       RELATIONSHIP
OF THE PARTIES. The Company and the Operating Partnership, on the one hand, and the Advisor on the other, are not partners
or joint venturers with each other, and nothing in this Agreement shall be construed to make them such partners of joint venturers
or impose any liability as such on either of them.


  


14.       OTHER
ACTIVITIES OF THE ADVISOR. Nothing herein contained shall prevent the Advisor or any of its Affiliates from engaging in or
earning fees from 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, member, partner, employee, or stockholder of the Advisor or its Affiliates
to engage in or earn fees from any other business or to render services of any kind to any other partnership, corporation, firm,
individual, trust or association and earn fees for rendering such services. 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.


 






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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 partnership, corporation, firm, individual, trust or association. The Advisor or its Affiliates shall promptly disclose
to the Board knowledge of such condition or circumstance. If the Advisor or its Affiliates have sponsored other investment programs
with similar investment objectives which have investment funds available at the same time as the Company, it shall be the duty
of the Board (including the Independent Directors) to ensure that the Advisor and its Affiliates adopt the method approved by the
Independent Directors by which investments are to be allocated to the competing investment entities and to use their best efforts
to ensure that such method is applied fairly to the Company.


  


15.       TERM
OF AGREEMENT. This Agreement shall have an initial term of one year from the Effective Date and may be renewed for an unlimited
number of successive one-year terms upon mutual consent of the Parties. The Company will evaluate the performance of the Advisor
annually before renewing this Agreement, and each such renewal shall be for a term of no more than one year. Any such renewal
must be approved by the Independent Directors.


 


16.       TERMINATION
BY THE PARTIES. This Agreement may be terminated (i) immediately by the Company or the Operating Partnership for Cause or
upon the bankruptcy of the Advisor, (ii) upon 60 days written notice without Cause and without penalty by a majority of the Independent
Directors of the Company or (iii) upon 60 days written notice with Good Reason by the Advisor. The provisions of Sections 17 through
30 survive termination of this Agreement.


  


17.       ASSIGNMENT
TO AN AFFILIATE. This Agreement may be assigned by the Advisor to an Affiliate with the majority approval of the Board (including
a majority of the Independent Directors). The Advisor may assign any rights to receive fees or other payments under this Agreement
to any Person without obtaining the approval of the Board. 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 Operating Partnership
to a corporation, limited partnership or other organization which is a successor to all of the assets, rights and obligations
of the Company or the Operating Partnership, in which case such successor organization shall be bound hereunder and by the terms
of said assignment in the same manner as the Company and the Operating Partnership are bound by this Agreement.


 


18.       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 receive from the Company or the Operating Partnership within 30 days after the effective date of such termination all unpaid
reimbursements of expenses and all earned but unpaid fees payable to the Advisor prior to termination of this Agreement, subject
to the 2%/25% Guidelines to the extent applicable.


 


  (b)           The
Advisor shall promptly upon termination:


 


(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.


 





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19.         INDEMNIFICATION
BY THE COMPANY AND THE OPERATING PARTNERSHIP. The Company and the Operating Partnership shall indemnify and hold harmless
the Advisor and its Affiliates, including their respective directors (the “Indemnitees,” and each an “Indemnitee”),
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, and to the extent that such indemnification would not be inconsistent with the laws of the State of Maryland, the
Articles of Incorporation or the provisions of Section II.G of the NASAA REIT Guidelines. In addition, the Company and the Operating
Partnership shall indemnify and hold harmless the officers of the Company and the Advisor and its Affiliates 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, and
to the extent that such indemnification would not be inconsistent with the laws of the State of Maryland or the Articles of Incorporation.
Notwithstanding the foregoing, the Company and the Operating Partnership shall not provide for indemnification of an Indemnitee
for any loss or liability suffered by such Indemnitee, nor shall they provide that an Indemnitee be held harmless for any loss
or liability suffered by the Company and the Operating Partnership, unless all of the following conditions are met:


 


(a)       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;


 


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


 


(c)       such
liability or loss was not the result of negligence or misconduct by the Indemnitee; and


 


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


 


Notwithstanding the
foregoing, an Indemnitee shall not be indemnified by the Company and the Operating Partnership for any losses, liabilities or expenses
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:


 


(a)       there
has been a successful adjudication on the merits of each count involving alleged securities law violations as to the Indemnitee;


 


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


 


(c)       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.


 






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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 of the following conditions
are satisfied:


 


(a)       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;


 


(b)       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


 


(c)       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.


  


20.          INDEMNIFICATION
BY ADVISOR. The Advisor shall indemnify and hold harmless the Company and the Operating Partnership from contract or other
liability, claims, damages, taxes or losses and related expenses including attorneys’ fees, to the extent that such liability,
claims, damages, taxes or losses and related expenses are not fully reimbursed by insurance and are incurred by reason of the
Advisor’s bad faith, fraud, misfeasance, intentional misconduct, 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.


 


21.          EXCLUSION
OF CERTAIN TRANSACTIONS. In the event the Company or the Operating Partnership shall propose to enter into any transaction
in which a Director or an officer of the Company, and the Advisor, or any Affiliate of the Company, the Operating Partnership
or the Advisor has a direct or indirect interest, then such transaction shall be approved by a majority of the Board and also
by a majority of the Independent Directors.


 


22.          NON-SOLICITATION.
 During the period commencing on the Effective Date and ending one year following the Termination Date, the Company shall
not, without the Advisor’s prior written consent, directly or indirectly (i) solicit or encourage any person to leave the
employment or other service of the Advisor or its Affiliates; or (ii) hire on behalf of the Company or any other person or entity,
any person who has left its employment within the one year period following the termination of that person’s employment
the Advisor or its Affiliates. During the period commencing on the date hereof through and ending one year following the Termination
Date, the Company will not, whether for its own account or for the account of any other Person, intentionally interfere with the
relationship of the Advisor or its Affiliates with, or endeavor to entice away from the Advisor or its Affiliates, any person
who during the term of the Agreement is, or during the preceding one-year period, was a tenant, co-investor, co-developer, joint
venturer or other customer of the Advisor or its Affiliates.


  


23.          NOTICES.
Any notice, report or other communication required or permitted to be given hereunder shall be in writing unless some other method
of giving such notice, report or other communication is required by the Articles of Incorporation, the Bylaws, or accepted by
the Party to whom it is given, and shall be given by being delivered by hand, by facsimile transmission, by courier or overnight
carrier or by registered or certified mail to the addresses set forth herein:


 


	To the Board and to the Company:	Moody National REIT II, Inc.
	 	6363 Woodway, Suite 110
	 	Houston, Texas 77057


	 	Facsimile: (713) 977-7505
	 	Attention: Brett C. Moody



 






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	with a copy to (which shall not	Alston & Bird LLP
	constitute notice):	1201 West Peachtree Street
	 	Atlanta, GA 30309
	 	Attention: Rosemarie A. Thurston
	 	 
	To the Operating Partnership:	Moody National Operating Partnership II, LP
	 	6363 Woodway, Suite 110
	 	Houston, Texas 77057
	 	Facsimile: (713) 977-7505
	 	Attention: Brett C. Moody
	 	 
	To the Advisor:	Moody National Advisor II, LLC
	 	6363 Woodway, Suite 110
	 	Houston, Texas 77057
	 	Facsimile: (713) 977-7505
	 	Attention: Brett C. Moody







 


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 23.


  


24.          MODIFICATION.
This Agreement shall not be changed, modified, 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.


 


25.          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.


  


26.          CONSTRUCTION.
The provisions of this Agreement shall be construed and interpreted in accordance with the laws of the State of Maryland.


  


27.          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. This Agreement may not
be modified or amended other than by an agreement in writing.


 


28.          INDULGENCES,
NOT WAIVERS. 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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29.          GENDER.
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.


 


30.          TITLES
NOT TO AFFECT INTERPRETATION. 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.


 


31.          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 one or more counterparts hereof, individually or taken together, shall bear the signatures
of all of the Parties reflected hereon as the signatories.


  


32.          EFFECTIVENESS
OF AGREEMENT. This Agreement, as amended and restated herein, shall not become effective until the Merger Effective Time.
If the Merger Agreement is terminated prior to the Merger Effective Time, this Agreement shall automatically be deemed revoked
and void ab initio, and the Parties shall have the rights and obligations set forth in the Original Agreement.


 


[Signatures on following page.]


 




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


 





	 	Moody National REIT II, Inc.
	 	 	 
	 	By:	/s/ Brett C. Moody
	 	 	Name: Brett C. Moody
	 	 	Title: Chief Executive Officer and President
	 	 	 
	 	Moody National Operating Partnership II, LP
	 	 	 
	 	By:	Moody National REIT II, Inc., its General Partner
	 	 	 
	 	By:	/s/ Brett C. Moody
	 	 	Name: Brett C. Moody
	 	 	Title: Chief Executive Officer and President
	 	 	 
	 	Moody National Advisor II, LLC
	 	 	 
	 	By:	Moody National REIT Sponsor, LLC
	 	 	 
	 	By:	Moody National REIT Sponsor SM, LLC
	 	 	 
	 	By:	/s/ Brett C. Moody
	 	 	Name: Brett C. Moody
	 	 	Title: Member



 





[Signature Page to Amended and Restated Advisory Agreement]














 




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SCHEDULE I


 


Merger Disposition Fee Allocation


 


	Asset	 	Share of Disposition Fee	 
	Homewood Suites Woodlands	 	$	316,839	 
	Hyatt Place Germantown	 	$	253,831	 
	Hyatt Place Charleston	 	$	234,029	 
	Hampton Inn Austin South	 	$	388,848	 
	Residence Inn Grapevine	 	$	444,655	 
	Courtyard Lyndhurst	 	$	657,081	 
	Hilton Garden Inn Austin	 	$	567,070	 
	Hampton Inn Great Valley	 	$	273,634	 
	Embassy Nashville	 	$	1,456,379	 
	Homewood Suites Austin	 	$	342,042	 
	Note receivable originated to Moody National DST Sponsor, LLC, aggregate principal amount of $9,000,000	 	$	162,020	 
	TownePlace Suites TCU	 	$	221,427	 
	Hampton Inn Energy Corridor	 	$	181,822	 
	Note receivable originated to Moody National Realty Company, L.P., aggregate principal amount of $4,500,000	 	$	81,010	 
	Total	 	$	5,580,685