Unassociated Document


    FORM
      OF ESCROW AGREEMENT

    


    THIS
      SUBSCRIPTION ESCROW AGREEMENT (this
      “Escrow
      Agreement”),
      dated
      as of November l,
      2008,
      is entered into by and among Lightstone Securities, LLC (the “Dealer
      Manager”),
      Lightstone Value Plus Real Estate Investment Trust II, Inc. (the “Company”)
      and
      Wells Fargo Bank, National Association, as Escrow Agent (the “Escrow
      Agent”).

    


    WHEREAS,
      the
      Company intends to raise cash funds from investors (the “Investors”)
      pursuant to a public offering (the “Offering”)
      of not
      less than $5,000,000 (the “Minimum
      Amount”)
      nor
      more than $510,000,000 of shares of common stock, par value $0.01 of the Company
      (the “Securities”)
      pursuant to the registration statement on Form S-11 of the Company (No.
      333-151532) (the “Offering
      Document”),
      a
      copy of which is attached as Exhibit A hereto. 

    


    WHEREAS,
      the
      Company desires to establish an escrow account with the Escrow Agent for funds
      contributed by the Investors with the Escrow Agent, to be held for the benefit
      of the Investors and the Company until such time as (i) subscriptions for the
      Minimum Amount of the Securities, have been deposited into escrow or otherwise
      in accordance with the terms of this Escrow Agreement and (ii) in the case
      of
      subscriptions received from residents of Pennsylvania (“Pennsylvania
      Investors”)
      and
      residents of Massachusetts (“Massachusetts
      Investors”),
      subscriptions resulting in a total minimum capital raised of $25,500,000 (the
      “Pennsylvania
      and Massachusetts Minimum Amount”)
      and
      deposited into escrow or otherwise provided in accordance with the terms of
      this
      Escrow Agreement.

    


    WHEREAS,
      the
      Escrow Agent is willing to accept appointment as Escrow Agent only for the
      expressed duties outlined herein.

    


    NOW,
      THEREFORE,
      in
      consideration of the premises set forth above and other good and valuable
      consideration, the receipt of which is hereby acknowledged, the parties hereto
      agree as follows:

    


    1.
       Proceeds
      to be Escrowed. On
      or
      before the first date of the Offering, the Company shall establish an escrow
      account with the Escrow Agent to be invested in accordance with Section 8 hereof
      entitled “ESCROW ACCOUNT FOR THE BENEFIT OF SUBSCRIBERS FOR COMMON STOCK OF
      LIGHTSTONE VALUE PLUS REAL ESTATE INVESTMENT TRUST II, INC.” (the “Escrow
      Account”).
      All
      funds received from Investors in payment for the Securities (“Investor
      Funds”)
      will
      be delivered to the Escrow Agent within one (1) business day following the
      day
      upon which such Investor Funds are received by the Company, and shall, upon
      receipt by the Escrow Agent, be retained in escrow by the Escrow Agent and
      invested as stated herein. During the term of this Escrow Agreement, the Company
      or its agents shall cause all checks received by and made payable to it in
      payment for the Securities to be endorsed in favor of the Escrow Agent and
      delivered to the Escrow Agent for deposit in the Escrow Account. 

    


    Proceeds
      received from Pennsylvania Investors and Massachusetts Investors shall be
      accounted for separately in a subaccount entitled “Escrow Account for the
      Benefit of Pennsylvania and Massachusetts Subscribers for Lightstone II” (the
“Pennsylvania
      and Massachusetts Escrow Account”),
      until
      such Pennsylvania and Massachusetts Escrow Account has closed pursuant to
      Section 4 hereof. The Company shall, and shall cause its agents to, cooperate
      with the Escrow Agent in separately accounting for subscription proceeds from
      Pennsylvania Investors and Massachusetts Investors in the Pennsylvania and
      Massachusetts Escrow Account, and the Escrow Agent shall be entitled to rely
      upon information provided by the Company or its agents in this
      regard.


    
      
        
        

      

      
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    The
      Escrow Agent shall have no duty to make any disbursement, investment or other
      use of Investor Funds until and unless it has good and collected funds. In
      the
      event that any checks deposited in the Escrow Account or Pennsylvania and
      Massachusetts Escrow Account are returned or prove uncollectible after the
      funds
      represented thereby have been released by the Escrow Agent, then the Company
      shall promptly reimburse the Escrow Agent for any and all costs incurred for
      such, upon request, and the Escrow Agent shall deliver the returned checks
      to
      the Company. The Escrow Agent shall be under no duty or responsibility to
      enforce collection of any check delivered to it hereunder. 
      The
      Escrow Agent reserves the right to deny, suspend or terminate participation
      by
      an Investor to the extent the Escrow Agent deems it advisable or necessary
      to
      comply with applicable laws or to eliminate practices that are not consistent
      with the purposes of the Offering.

    


    2.
       Subscribers.
      Persons
      subscribing to purchase the Securities will be instructed by Lightstone
      Securities, LLC (the “Dealer
      Manager”)
      or any
      soliciting dealers to remit the purchase price in the form of checks
      (hereinafter “instruments of payment”) payable to the order of, or funds wired
      in favor of, “WELLS FARGO BANK, NA, ESCROW AGENT FOR LIGHTSTONE II.” Any checks
      received made payable to a party other than the Escrow Agent shall be returned
      to the soliciting dealer who submitted the check. By 12:00 p.m. (noon) the
      next
      business day after receipt of instruments of payment from the Offering, the
      Escrow Agent shall be furnished with a list of the Investors
      who have paid for the Securities showing the name, address, tax identification
      number, amount of Securities subscribed for, the amount paid and whether such
      Investors are Pennsylvania Investors or not. The information comprising the
      identity of Investors shall be provided to the Escrow Agent in the format set
      forth in the “List of Investors” attached hereto as Exhibit B. The Escrow Agent
      shall be entitled to conclusively rely upon the list of Investors in determining
      whether Investors are Pennsylvania Investors or not, and shall have no duty
      to
      independently determine or verify the same.

    


    All
      Investor Funds deposited in the Escrow Account or Pennsylvania and Massachusetts
      Escrow Account shall not be subject to any liens or charges by the Company
      or
      the Escrow Agent, or judgments or creditors’ claims against the Company, until
      and unless released to the Company as hereinafter provided. The Company
      understands and agrees that the Company shall not be entitled to any Investor
      Funds on deposit in the Escrow Account or Pennsylvania and Massachusetts Escrow
      Account and no such funds shall become the property of the Company, or any
      other
      entity except as released to the Company pursuant to Section 3 or Section 4
      for
      Pennsylvania Investors. The Escrow Agent will not use the information provided
      to it by the Company for any purpose other than to fulfill its obligations
      as
      Escrow Agent. The Company and the Escrow Agent will treat all Investor
      information as confidential. The Escrow Agent shall not be required to accept
      any Investor Funds which are not accompanied by the information on the List
      of
      Investors. 


    
      
        
        

      

      
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    3.
       Disbursement
      of Funds. Once
      the
      Escrow Agent is in receipt of good and collected Investor Funds totaling at
      least the Minimum Amount, the Escrow Agent shall notify the Company of same
      in
      writing. Additionally, at the end of the third business day following the
      Termination Date (as defined in Section 5), the Escrow Agent shall notify the
      Company of the amount of the Investor Funds received. If the Minimum Amount
      has
      been obtained on or before the Termination Date, the Escrow Agent shall promptly
      notify the Company and, upon receiving written instructions from the Company,
      the Escrow Agent shall disburse to the Company, by check or wire transfer,
      the
      funds in the Escrow Account representing the gross purchase price of the
      Securities. 

     

    If
      the
      Minimum Amount has not been obtained prior to the Termination Date, the Escrow
      Agent shall, within a reasonable time following the Termination Date, but in
      no
      event more than thirty (30) days after the Termination Date, refund to each
      Investor by check funds deposited in the Escrow Account, or shall return the
      instruments of payment delivered to Escrow Agent if such instruments have not
      been processed for collection prior to such time, directly to each Investor
      at
      the address provided in the list of Investors. Included in the remittance shall
      be a proportionate share of the income earned in the account allocable to each
      Investor’s investment in accordance with the terms and conditions specified
      herein, except that in the case of subscribers who have not provided an executed
      Form W-9 or substitute Form W-9 (or the applicable substitute Form W-8 for
      foreign investors), the Escrow Agent shall withhold the applicable percentage
      of
      the earnings attributable to those Investors in accordance with IRS regulations.
      Notwithstanding the foregoing, the Escrow Agent shall not be required to remit
      any payments until funds represented by such payments have been collected by
      Escrow Agent.

    


    In
      the
      event the Escrow Agent receives written notice from the Company that the Company
      intends to reject an Investor’s subscription, the Escrow Agent shall pay to the
      applicable Investor(s), within a reasonable time not to exceed ten (10) business
      days after receiving notice of the rejection, by first class United States
      Mail
      at the address appearing on the List of Investors, or at such other address
      as
      shall be furnished to the Escrow Agent by the Investor in writing, all collected
      sums paid by the Investor for Securities and received by the Escrow Agent,
      together with the interest earned on such Investor Funds. 

    


    4.
       Disbursement
      of Proceeds for Pennsylvania Investors and
      Massachusetts Investors. Proceeds
      from Pennsylvania Investors and Massachusetts Investors will count towards
      meeting the Minimum Amount for purposes of Section 3, but notwithstanding
      anything to the contrary herein such proceeds will not be released from the
      Pennsylvania and Massachusetts Escrow Account until the Pennsylvania and
      Massachusetts Minimum Amount is obtained. If the Pennsylvania and Massachusetts
      Minimum Amount is obtained at any time prior to the Termination Date, the Escrow
      Agent shall promptly notify the Company and, upon receiving written instructions
      from the Company, the Escrow Agent shall disburse to the Company, by check
      or
      wire transfer, the funds in the Pennsylvania and Massachusetts Escrow Account
      representing the gross purchase price of the Securities. 

    


    If
      the
      Pennsylvania and Massachusetts Minimum Amount has not been obtained prior to
      the
      Termination Date, the Escrow Agent shall, within a reasonable time following
      the
      Termination Date, but in no event more than thirty (30) days after the
      Termination Date, refund to each Pennsylvania Investor and Massachusetts
      Investor by check funds deposited in the Pennsylvania and Massachusetts Escrow
      Account, or shall return the instruments of payment delivered to Escrow Agent
      if
      such instruments have not been processed for collection prior to such time,
      directly to each Pennsylvania Investor or Massachusetts Investors at the address
      provided in the list of Investors. Included in the remittance shall be a
      proportionate share of the income earned in the account allocable to each
      Pennsylvania Investor’s or and Massachusetts Investor’s investment in accordance
      with the terms and conditions specified herein, except that in the case of
      subscribers who have not provided an executed Form W-9 or substitute Form W-9,
      the Escrow Agent shall withhold the applicable percentage of the earnings
      attributable to those Investors in accordance with IRS regulations.
      Notwithstanding the foregoing, the Escrow Agent shall not be required to remit
      any payments until funds represented by such payments have been collected by
      Escrow Agent.


    
      
        
        

      

      
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    If
      the
      Escrow Agent is not in receipt of evidence of subscriptions accepted on or
      before the close of business on such date that is 120 days after commencement
      of
      the Offering (the Company will notify the Escrow Agent of the commencement
      date
      of the Offering) (the “Initial
      Escrow Period”),
      and
      instruments of payment dated not later than that date, for the purchase of
      Securities providing for total purchase proceeds from all nonaffiliated sources
      that equal or exceed the Pennsylvania and Massachusetts Minimum Amount, the
      Escrow Agent shall promptly notify the Company. Thereafter, the Company or
      its
      agents shall send to each Pennsylvania Investor by certified mail within ten
      (10) calendar days after the end of the Initial Escrow Period a
      notification substantially in the form of Exhibit F. If, pursuant to such
      notification, a Pennsylvania Investor requests the return of his or her
      subscription funds within ten (10) calendar days after receipt of the
      notification (the “Request
      Period”),
      the
      Escrow Agent shall promptly refund directly to each Pennsylvania Investor the
      collected funds deposited in the Pennsylvania and Massachusetts Escrow Account
      on behalf of such Pennsylvania Investor or shall return the instruments of
      payment delivered, but not yet processed for collection prior to such time,
      to
      the address provided by the Dealer Manager or the Company or their respective
      agents to the Escrow Agent, which the Escrow Agent shall be entitled to rely
      upon, together with interest income (which interest shall be paid within five
      business days after the first business day of the succeeding month) in the
      amounts calculated pursuant to Section 8. Notwithstanding the above, if the
      Escrow Agent has not received an executed Form W-9 or substitute Form W-9 for
      such Pennsylvania Investor, the Escrow Agent shall thereupon remit an amount
      to
      such Pennsylvania Investor in accordance with the provisions hereof, withholding
      the applicable percentage for backup withholding required by the Internal
      Revenue Code, as then in effect, from any interest income earned on subscription
      proceeds (determined in accordance with Section 8) attributable to such
      Pennsylvania Investor. However, the Escrow Agent shall not be required to remit
      such payments until the Escrow Agent has collected funds represented by such
      payments. 

    


        The
      subscription funds of Pennsylvania Investors who do not request the return
      of
      their subscription funds within the Request Period shall remain in the
      Pennsylvania and Massachusetts Escrow Account for successive 120-day escrow
      periods (a “Successive
      Escrow Period”),
      each
      commencing automatically upon the termination of the prior Successive Escrow
      Period, and the Company and Escrow Agent shall follow the notification and
      payment procedure set forth above with respect to the Initial Escrow Period
      for
      each Successive Escrow Period until the occurrence of the earliest of
      (i) the Termination Date, (ii) the receipt and acceptance by the
      Company of subscriptions for the purchase of Securities with total purchase
      proceeds that equal or exceed the Pennsylvania and Massachusetts Minimum Amount
      and the disbursement of the Pennsylvania and Massachusetts Escrow Account on
      the
      terms specified herein, or (iii) all funds held in the Pennsylvania and
      Massachusetts Escrow Account having been returned to the Pennsylvania Investors
      and Massachusetts Investors in accordance with the provisions hereof.



    
      
        
        

      

      
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    5.
       Term
      of Escrow. The
      “Termination Date” shall be the earlier of (i) the close of business on the one
      year anniversary of the date of this Escrow Agreement; (ii) all funds held
      in
      the Escrow Account and the Pennsylvania and Massachusetts Escrow Account are
      distributed to the Company or to Investors pursuant to Section 3 and Section
      4
      for Pennsylvania Investors and Massachusetts Investors and the Company has
      informed the Escrow Agent in writing to close the Escrow Account and the
      Pennsylvania and Massachusetts Escrow Account; (iii) the date the Escrow Agent
      receives written notice from the Company that it is abandoning the sale of
      the
      Securities; or (iv) the date the Escrow Agent receives notice from the
      Securities and Exchange Commission or any other federal or state regulatory
      authority that a stop or similar order has been issued with respect to the
      Offering Document and has remained in effect for at least twenty (20) days.
      After the Termination Date the Company shall not deposit, and the Escrow Agent
      shall not accept, any additional amounts representing payments by prospective
      Investors. 

    


    6.
       Duty
      and Liability of the Escrow Agent. The
      sole
      duty of the Escrow Agent shall be to receive Investor Funds and hold them
      subject to release, in accordance herewith, and the Escrow Agent shall be under
      no duty to determine whether the Company or the Dealer Manager is complying with
      requirements of this Escrow Agreement, the Offering or applicable securities
      or
      other laws in tendering the Investor Funds to the Escrow Agent. No other
      agreement entered into between the parties, or any of them, shall be considered
      as adopted or binding, in whole or in part, upon the Escrow Agent
      notwithstanding that any such other agreement may be referred to herein or
      deposited with the Escrow Agent or the Escrow Agent may have knowledge thereof,
      including specifically but without limitation any Offering Documents, and the
      Escrow Agent’s rights and responsibilities shall be governed solely by this
      Escrow Agreement. The Escrow Agent shall not be responsible for or be required
      to enforce any of the terms or conditions of any Offering Document or other
      agreement between the Company and any other party. The Escrow Agent may
      conclusively rely upon and shall be protected in acting upon any statement,
      certificate, notice, request, consent, order or other document believed by
      it to
      be genuine and to have been signed or presented by the proper party or parties.
      The Escrow Agent shall have no duty or liability to verify any such statement,
      certificate, notice, request, consent, order or other document, and its sole
      responsibility shall be to act only as expressly set forth in this Escrow
      Agreement. Concurrent with the execution of this Escrow Agreement, the Company
      shall deliver to the Escrow Agent an authorized signers form in the form of
      Exhibit C to this Escrow Agreement. The Escrow Agent shall be under no
      obligation to institute or defend any action, suit or proceeding in connection
      with this Escrow Agreement unless first indemnified to its satisfaction. The
      Escrow Agent may consult counsel of its own choice with respect to any question
      arising under this Escrow Agreement and the Escrow Agent shall not be liable
      for
      any action taken or omitted in good faith upon advice of such counsel. The
      Escrow Agent shall not be liable for any action taken or omitted by it in good
      faith except to the extent that a court of competent jurisdiction determines
      that the Escrow Agent’s gross negligence or willful misconduct was the primary
      cause of loss. The Escrow Agent is acting solely as escrow agent hereunder
      and
      owes no duties, covenants or obligations, fiduciary or otherwise, to any other
      person by reason of this Escrow Agreement, except as otherwise stated herein,
      and no implied duties, covenants or obligations, fiduciary or otherwise, shall
      be read into this Escrow Agreement against the Escrow Agent.  In the event
      of any disagreement between any of the parties to this Escrow Agreement, or
      between any of them and any other person, including any Investor, resulting
      in
      adverse claims or demands being made in connection with the matters covered
      by
      this Escrow Agreement, or in the event that the Escrow Agent is in doubt as
      to
      what action it should take hereunder, the Escrow Agent may, at its option,
      refuse to comply with any claims or demands on it, or refuse to take any other
      action hereunder, so long as such disagreement continues or such doubt exists,
      and in any such event, the Escrow Agent shall not be or become liable in any
      way
      or to any person for its failure or refusal to act, and the Escrow Agent shall
      be entitled to continue so to refrain from acting until (i) the rights of all
      interested parties shall have been fully and finally adjudicated by a court
      of
      competent jurisdiction, or (ii) all differences shall have been adjudged and
      all
      doubt resolved by agreement among all of the interested persons, and the Escrow
      Agent shall have been notified thereof in writing signed by all such persons.
      Notwithstanding the foregoing, the Escrow Agent may in its discretion obey
      the
      order, judgment, decree or levy of any court, whether with or without
      jurisdiction and the Escrow Agent is hereby authorized in its sole discretion
      to
      comply with and obey any such orders, judgments, decrees or levies. In the
      event
      that any controversy should arise with respect to this Escrow Agreement the
      Escrow Agent shall have the right, at its option, to institute an interpleader
      action in any court of competent jurisdiction to determine the rights of the
      parties. IN NO EVENT SHALL THE ESCROW AGENT BE LIABLE, DIRECTLY OR INDIRECTLY,
      FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL LOSSES OR DAMAGES OF ANY KIND
      WHATSOEVER (INCLUDING WITHOUT LIMITATION LOST PROFITS), EVEN IF THE ESCROW
      AGENT
      HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSSES OR DAMAGES AND REGARDLESS
      OF
      THE FORM OF ACTION. The parties agree that the Escrow Agent has no role in
      the
      preparation of the Offering Documents and makes no representations or warranties
      with respect to the information contained therein or omitted therefrom. The
      Escrow Agent shall have no obligation, duty or liability with respect to
      compliance with any federal or state securities, disclosure or tax laws
      concerning the Offering Documents or the issuance, offering or sale of the
      Securities. The Escrow Agent shall have no duty or obligation to monitor the
      application and use of the Investor Funds once transferred to the Company,
      that
      being the sole obligation and responsibility of the Company. 


    
      
        
        

      

      
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    7.
       Escrow
      Agent’s Fee. The
      Escrow Agent shall be entitled to compensation for its services as stated in
      the
      fee schedule attached hereto as Exhibit D, which compensation shall be paid
      by
      the Company. The fee agreed upon for the services rendered hereunder is intended
      as full compensation for the Escrow Agent’s services as contemplated by this
      Escrow Agreement; provided, however, that in the event that the conditions
      for
      the disbursement of funds under this Escrow Agreement are not fulfilled, or
      the
      Escrow Agent renders any material service not contemplated in this Escrow
      Agreement, or there is any assignment of interest in the subject matter of
      this
      Escrow Agreement, or any material modification hereof, or if any material
      controversy arises hereunder, or the Escrow Agent is made a party to any
      litigation pertaining to this Escrow Agreement, or the subject matter hereof,
      then the Escrow Agent shall be reasonably compensated for such extraordinary
      services and reimbursed for all costs and expenses, including reasonable
      attorney’s fees, occasioned by any delay, controversy, litigation or event, and
      the same shall be recoverable from the Company. The Company’s obligations under
      this Section 6 shall survive the resignation or removal of the Escrow Agent
      and
      the assignment or termination of this Escrow Agreement.

    


    8. Investment
      of Proceeds. The
      Investor Funds shall be deposited in the Escrow Account and the Pennsylvania
      and
      Massachusetts Escrow Account, as applicable. The Escrow Agent is hereby directed
      to invest all funds received under this Escrow Agreement, including principal
      and interest in, a Wells Fargo Bank Money Market Deposit Account, as directed
      in
      writing in the form of Exhibit E to this Escrow Agreement. The Escrow Agent
      shall invest the Investor Funds in alternative investments in accordance with
      written instructions as may from time to time be provided to the Escrow Agent
      and signed by the Company. In the absence of written investment instructions
      from the Company to the contrary, the Escrow Agent is hereby directed to invest
      the Investor Funds in the Wells Fargo Bank Money Market Deposit Account.
 Notwithstanding
      the foregoing, Investor Funds shall not be invested in anything other than
      “Short Term Investments” in compliance with Rule 15c2-4 of the Securities
      Exchange Act of 1934, as amended. The following are not permissible investments:
      (a) money market mutual funds, (b) corporate debt or equity securities, (c)
      repurchase agreements, (d) banker’s acceptance, (e) commercial paper, and (f)
      municipal securities. Any interest received by the Escrow Agent with respect
      to
      the Investor Funds, including reinvested interest shall become part of the
      Investor Funds, and shall be disbursed pursuant to Section 3 or Section 4 for
      Pennsylvania Investors and Massachusetts Investors. 

    


    The
      Escrow Agent shall be entitled to sell or redeem any such investments as
      necessary to make any payments or distributions required under this Escrow
      Agreement. The Escrow Agent shall have no responsibility or liability for any
      loss which may result from any investment made pursuant to this Escrow
      Agreement, or for any loss resulting from the sale of such investment. The
      parties acknowledge that the Escrow Agent is not providing investment
      supervision, recommendations, or advice.

     

    The
      Company on the date of this Escrow Agreement shall provide the Escrow Agent
      with
      certified tax identification numbers by furnishing appropriate IRS forms W-9
      or
      W-8 and other forms and documents that the Escrow Agent may reasonably request.
      The Company understands that if such tax reporting documentation is not so
      certified to the Escrow Agent, the Escrow Agent may be required by the Internal
      Revenue Code of 1986, as amended, to withhold a portion of any interest or
      other
      income earned on the Investor Funds pursuant to this Escrow Agreement.


    


    The
      Company agrees to indemnify and hold the Escrow Agent harmless from and against
      any taxes, additions for late payment, interest, penalties and other expenses
      that may be assessed against the Escrow Agent on or with respect to any payment
      or other activities under this Escrow Agreement unless any such tax, addition
      for late payment, interest, penalties and other expenses shall be determined
      by
      a court of competent jurisdiction to have been caused by the Escrow Agent’s
      gross negligence or willful misconduct. The terms of this Section shall survive
      the termination of this Escrow Agreement and the resignation or removal of
      the
      Escrow Agent.


    
      
        
        

      

      
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    9.
       Notices.
      All
      notices, requests, demands, and other communications under this Escrow Agreement
      shall be in writing and shall be deemed to have been duly given (a) on the
      date
      of service if served personally on the party to whom notice is to be given,
      (b)
      on the day of transmission if sent by facsimile/email transmission to the
      facsimile number/email address given below, and telephonic confirmation of
      receipt is obtained promptly after completion of transmission, (c) on the day
      after delivery to Federal Express or similar overnight courier or the Express
      Mail service maintained by the United States Postal Service, or (d) on the
      fifth
      day after mailing, if mailed to the party to whom notice is to be given, by
      first class mail, registered or certified, postage prepaid, and properly
      addressed, return receipt requested, to the party as follows:

    


    If
      to the
      Company:

     

    326
      Third
      Street

    Lakewood,
      New Jersey 08701

    Fax
      (732)
      363-7183

    Attention:
      David Lichtenstein, Chief Executive Officer

    


    with
      a
      copy to: 

    


    Proskauer
      Rose LLP

    1585
      Broadway

    New
      York,
      New York 10036

    Fax:
      (212) 969-2900

    Attention:
      Peter M. Fass, Esq.

    


    If
      to the
      Dealer Manager:

    


    Lightstone
      Securities, LLC

    One
      International Boulevard, Suite 200

    Mahwah,
      New Jersey 07430

    Attention:
      Stephen Hamrick, Chief Executive Officer

    


    with
      a
      copy to: 

    


    Proskauer
      Rose LLP

    1585
      Broadway

    New
      York,
      New York 10036

    Fax:
      (212) 969-2900

    Attention:
      Peter M. Fass, Esq.

    


    If
      to
      Escrow Agent:

    


    Wells
      Fargo Bank, National Association

    201
      Main
      Street, Suite 301

    Forth
      Worth, Texas 76102-5489

    Attention:
      John C. Stohlmann; Corporate,
      Municipal and Escrow Services


    
      
        
        

      

      
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    Any
      party
      may change its address for purposes of this Section by giving the other party
      written notice of the new address in the manner set forth above.

    


    10.
       Indemnification
      of Escrow Agent: The
      Company and the Dealer Manager hereby jointly and severally indemnify, defend
      and hold harmless the Escrow Agent from and against, any and all loss,
      liability, cost, damage and expense, including, without limitation, reasonable
      counsel fees and expenses, which the Escrow Agent may suffer or incur by reason
      of any action, claim or proceeding brought against the Escrow Agent arising
      out
      of or relating in any way to this Escrow Agreement or any transaction to which
      this Escrow Agreement relates unless such loss, liability, cost, damage or
      expense is finally determined by a court of competent jurisdiction to have
      been
      primarily caused by the willful misconduct of the Escrow Agent. The terms of
      this Section shall survive the termination of this Escrow Agreement and the
      resignation or removal of the Escrow Agent.

    


    11.
       Successors
      and Assigns. Except
      as
      otherwise provided in this Escrow Agreement, no party hereto shall assign this
      Escrow Agreement or any rights or obligations hereunder without the prior
      written consent of the other parties hereto and any such attempted assignment
      without such prior written consent shall be void and of no force and effect.
      This Escrow Agreement shall inure to the benefit of and shall be binding upon
      the successors and permitted assigns of the parties hereto. Any corporation
      or
      association into which the Escrow Agent may be converted or merged, or with
      which it may be consolidated, or to which it may sell or transfer all or
      substantially all of its corporate trust business and assets as a whole or
      substantially as a whole, or any corporation or association resulting from
      any
      such conversion, sale, merger, consolidation or transfer to which the Escrow
      Agent is a party, shall be and become the successor Escrow Agent under this
      Escrow Agreement and shall have and succeed to the rights, powers, duties,
      immunities and privileges as its predecessor, without the execution or filing
      of
      any instrument or paper or the performance any further act.

    


    12.
       Governing
      Law; Jurisdiction. This
      Escrow Agreement shall be construed, performed, and enforced in accordance
      with,
      and governed by, the internal laws of the State of New York, without giving
      effect to the principles of conflicts of laws thereof.

    


    13.
       Severability.
      In
      the
      event that any part of this Escrow Agreement is declared by any court or other
      judicial or administrative body to be null, void, or unenforceable, said
      provision shall survive to the extent it is not so declared, and all of the
      other provisions of this Escrow Agreement shall remain in full force and
      effect.

    


    14.
       Amendments;
      Waivers. This
      Escrow Agreement may be amended or modified, and any of the terms, covenants,
      representations, warranties, or conditions hereof may be waived, only by a
      written instrument executed by the parties hereto, or in the case of a waiver,
      by the party waiving compliance. Any waiver by any party of any condition,
      or of
      the breach of any provision, term, covenant, representation, or warranty
      contained in this Escrow Agreement, in any one or more instances, shall not
      be
      deemed to be nor construed as further or continuing waiver of any such
      condition, or of the breach of any other provision, term, covenant,
      representation, or warranty of this Escrow Agreement. The Company and the Dealer
      Manager agree that any requested waiver, modification or amendment of this
      Escrow Agreement shall be consistent with the terms of the Offering.



    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    15.
       Entire
      Agreement. This
      Escrow Agreement contains the entire understanding among the parties hereto
      with
      respect to the escrow contemplated hereby and supersedes and replaces all prior
      and contemporaneous agreements and understandings, oral or written, with regard
      to such escrow.

    


    16.
       Section
      Headings. The
      section headings in this Escrow Agreement are for reference purposes only and
      shall not affect the meaning or interpretation of this Escrow
      Agreement.

    


    17.
       Counterparts.
      This
      Escrow Agreement may be executed in counterparts, each of which shall be deemed
      an original, but all of which shall constitute the same instrument.

    


    18.
       Resignation.
      The
      Escrow Agent may resign upon 30 days advance written notice to the parties
      hereto. If a successor escrow agent is not appointed within the 30-day period
      following such notice, the Escrow Agent may petition any court of competent
      jurisdiction to name a successor escrow agent or interplead the Investor Funds
      with such court, whereupon the Escrow Agent’s duties hereunder shall
      terminate.

    


    19. References
      to Escrow Agent.
      Other
      than the Offering Document (including the subscription agreement and exhibits
      thereto) and any amendments or supplements thereto, no printed or other matter
      in any language (including, without limitation, notices, reports and promotional
      material) which mentions the Escrow Agent’s name or the rights, powers, or
      duties of the Escrow Agent shall be issued by the Company or the Dealer Manager,
      or on the Company’s or the Dealer Manager’s behalf, unless the Escrow Agent
      shall first have given its specific written consent thereto. Notwithstanding
      the
      foregoing, any amendment or supplement to the Offering Document (including
      the
      subscription agreement and exhibits thereto) that revises, alters, modifies,
      changes or adds to the description of the Escrow Agent or its rights, powers
      or
      duties hereunder shall not be issued by the Company or the Dealer Manager,
      or on
      the Company’s or Dealer Manager’s behalf, unless the Escrow Agent has first
      given specific written consent thereto.

    


    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

    


    


    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF,
      the
      parties hereto have caused this Escrow Agreement to be executed the date and
      year first set forth above.

     

    
      	LIGHTSTONE VALUE PLUS REAL
              ESTATE
INVESTMENT TRUST II, INC. 	 	 	 
	 	 	 	 
	
            	 	 	
            
	 	 	 	 
	
              
By:
              David Lichtenstein 	 	 	
            
	Title:
              Chief
              Executive Officer	 	 	 
	 	 	 	 
	 	 	 	 
	LIGHTSTONE SECURITIES, LLC 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	
              
By:
              Stephen Hamrick  	 	 	 
	Title: Chief Executive
              Officer 	 	 	 
	 	 	 	 
	 	 	 	 
	WELLS FARGO BANK, NATIONAL
ASSOCIATION, as
              Escrow Agent 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	
              

              By: 	 	 	 
	Title: 	 	 	 


    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    Exhibit
      A

    


    Copy
      of
      Offering Document

    


    


    


    


    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    Exhibit
      B

    


    List
      of Investors

    


    Pursuant
      to the Escrow Agreement dated October , 2008, by and between Lightstone Value
      Plus Real Estate Investment Trust II, Inc., (the “Company”),
      and
      Wells Fargo Bank, National Association (the “Escrow
      Agent”),
      the
      Company hereby certifies that the following Investors have paid money for the
      purchase of ____________ (the “Securities”),
      and
      the money has been deposited with the Escrow Agent:

    


    


    
      	
              1.

            	
              Name
                of Subscriber

            


    

    Address

    Tax
      Identification Number

    Amount
      of
      Securities subscribed for

    Amount
      of
      money paid and deposited with Escrow Agent

    Is
      Subscriber a resident of Pennsylvania (Yes or No)?

    Is
      Subscriber a resident of Massachusetts (Yes or No)?

    


    
      	
              2.

            	
              Name
                of Subscriber

            


    

    Address

    Tax
      Identification Number

    Amount
      of
      Securities subscribed for

    Amount
      of
      money paid and deposited with Escrow Agent

    Is
      Subscriber a resident of Pennsylvania (Yes or No)?

    Is
      Subscriber a resident of Massachusetts (Yes or No)?

    


    


    


    


    Company:
      _________________________________

    By:
      ________________________

    Its:
      ________________________

    Date:
      ______________________

    


    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    Exhibit
      C

    


    CERTIFICATE
      AS TO AUTHORIZED SIGNATURES

    


    


    Account
      Name:

    


    Account
      Number:

    


    The
      specimen signatures shown below are the specimen signatures of the individuals
      who have been designated as Authorized Representatives of Lightstone
      Value Plus Real Estate Investment Trust II, Inc. and
      are
      authorized to initiate and approve transactions of all types for the
      above-mentioned account on behalf of Lightstone
      Value Plus Real Estate Investment Trust II, Inc. 

     

    
      	
              Name
                / Title 

            	 	 	
              Specimen
                Signature 

            
	
            	 	 	
            
	David Lichtenstein 	 	 	 
	Chief Executive Officer 	 	 	
              
                

              

              Signature 

            
	
            	 	 	
            
	 	 	 	 
	Stephen Hamrick 	 	 	 
	President 	 	 	
              
                

              

              Signature 

            
	 	 	 	 
	 	 	 	 
	Donna Brandin 	 	 	 
	Chief Financial Officer 	 	 	
              
                

              

              Signature

            
	 	 	 	 
	 	 	 	 
	Joseph Teichman 	 	 	 
	General Counsel	 	 	
              
                

              

              Signature 

            


    

    
 

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    Exhibit
      D

     

    Fee
      Schedule

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    Exhibit
      E

    


    Agency
      and Custody Account Direction 

    For
      Cash Balances

    Wells
      Fargo Bank Money Market Deposit Accounts

    


    


    Direction
      to use the following Wells Fargo Bank Money Market Deposit Accounts for Cash
      Balances for the escrow account (the “Account”) created under the Escrow
      Agreement to which this Exhibit is attached.

    


    You
      are
      hereby directed to deposit, as indicated below, or as we shall direct further
      in
      writing from time to time, all cash in the Account in the following money market
      deposit account of Wells Fargo Bank, National Association (“Bank”):

    


    Wells
      Fargo Bank Money Market Deposit Account (“MMDA”)

    


    We
      understand that amounts on deposit in the MMDA are insured, subject to the
      applicable rules and regulations of the Federal Deposit Insurance Corporation
      (the “FDIC”), in the basic FDIC insurance amount of $100,000 per depositor, per
      insured bank. This includes principal and accrued interest up to a total of
      $100,000. We understand that deposits in the MMDA are not secured.

    


    Wells
      Fargo Bank, National Association has short term debt ratings of “P-1” from
      Moody’s Investors Service and “A-1+” from Standard & Poor’s Ratings
      Services.

    


    We
      acknowledge that we have full power to direct investments in the
      Account.

    


    We
      understand that we may change this direction at any time and that it shall
      continue in effect until revoked or modified by us by written notice to
      you.

    


    
      	 	 	 	Lightstone Value Plus Real
              Estate
Investment Trust II, Inc. 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	
            	 	 	
              
Signature
	 	 	 	 
	 	 	 	
              
Date 




     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    Exhibit
      F

    


    [Form
      of
      Notice to Pennsylvania Investors] 

    


    You
      have
      tendered a subscription to purchase shares of common stock of Lightstone Value
      Plus Real Estate Investment Trust II, Inc. (the “Company”). Your subscription is
      currently being held in escrow. The guidelines of the Pennsylvania Securities
      Commission do not permit the Company to accept subscriptions from Pennsylvania
      residents until an aggregate of $25,500,000 of gross offering proceeds have
      been
      received by the Company. The Pennsylvania guidelines provide that until this
      minimum amount of offering proceeds is received by the Company, every
      120 days during the offering period Pennsylvania Investors may request that
      their subscription be returned. If you wish to continue your subscription in
      escrow until the Pennsylvania minimum subscription amount is received, nothing
      further is required. 

    


    If
      you
      wish to terminate your subscription for the Company’s common stock and have your
      subscription returned please so indicate below, sign, date, and return to the
      Escrow Agent, Wells Fargo Bank, National Association. 

    


    I
      hereby
      terminate my prior subscription to purchase shares of common stock of Lightstone
      Value Plus Real Estate Investment Trust II, Inc. and request the return of
      my
      subscription funds. I certify to Lightstone Value Plus Real Estate Investment
      Trust II, Inc. that I am a resident of Pennsylvania. 

    


    
      	
               

            	
               

            	
               

            	
               

            	
               

            
	
               

            	
               

            	
               

            	
              Signature:

            	
               

            
	
               

            	 	 	 	 	 
	
               

            	
               

            	
               

            	
              Name:

            	
               

            
	
               

            	
               

            	
               

            	
               

            	
                      (please
                print)

            	 
	
               

            	 	 	 	 	 
	
               

            	
               

            	
               

            	
              Date:

            	
               

            


    

    


    Please
      send the subscription refund to: 

        
                   
             
             
             
             
    

          
             
       
       
       
       
       
       
       
        

          
             
       
       
       
       
       
       
       
         

    


    
      
        
        

      

      
        16