AGREEMENT FOR ACQUISITION AND TRANSFER
OF REAL PROPERTY


 


FEDEX DISTRIBUTION FACILITIES
– 6 PACK


 


THIS AGREEMENT (“Agreement”)
is made and entered into as of the Effective Date by and between ARC Properties Operating Partnership, L.P. (“Buyer”),
and SETZER PROPERTIES, LLC (“Seller”).


 


BACKGROUND


 


A.Seller is an
affiliate of each of the entities listed on Exhibit A1 attached hereto (such entities listed on Exhibit A1
being referred to herein individually as an “Affiliate” or “Seller’s Affiliate”, and two or more
being referred to herein collectively as the “Affiliates”).


 


B.Buyer
desires to acquire the Property and Seller desires to transfer the Property to Buyer on the terms and conditions set forth in this
Agreement.


 


In consideration of
the mutual promises set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound, agree as follows:


 


1.Terms
and Definitions. The terms listed below shall have the respective meaning given them as set forth adjacent to each term.


 


(a)
“Closing” shall mean the consummation of the transaction contemplated herein, which shall occur, subject
to the extension set forth in Section 10 hereof, on the date that is thirty (30) days after the last day of the Due Diligence Period
(as defined herein). The date of Closing is sometimes hereinafter referred to as the “Closing Date.”
Neither party will need to be present at Closing, it being anticipated that the parties will deliver all Closing documents and
deliverables in escrow to the Escrow Agent (or if both Buyer and Seller agree, to Buyer’s and/or Seller’s counsel)
prior to the date of Closing.


 


(b)“Due
Diligence Period” shall mean the period beginning upon the Effective Date and extending until 11:59 PM EST on the
date that is thirty (30) days thereafter. Seller shall deliver to Buyer all of the Due Diligence Materials within five (5) business
days after the Effective Date, and for each day that passes thereafter until all of the Due Diligence Materials are delivered to
Buyer, the Due Diligence Period and the Closing Date shall be extended by one (1) business day.


 


(c)“Earnest
Money” shall mean Seventy Six Thousand Nine Hundred Five and 61/100 Dollars ($76,905.61). The Earnest Money shall
be delivered to Escrow Agent within three (3) business days after the Effective Date. The Earnest Money shall be deposited by Buyer
in escrow with Escrow Agent, to be applied as part payment of the cash portion of the Acquisition Price at the time the sale is
closed, or disbursed as agreed upon in accordance with the terms of this Agreement. Seller and Buyer each shall pay one-half of
all reasonable escrow fees charged by Escrow Agent.


 



    	 



    	 



    

 


(d)“Effective
Date” This Agreement shall be signed by both Seller and Buyer. The date that is one (1) business day after the date
of execution and delivery of this Agreement by both Seller and Buyer shall be the “Effective Date” of this Agreement.


 


(e)“Escrow
Agent” shall mean Chicago Title Insurance Company, whose address is Suite 1325, 1515 Market Street, Philadelphia,
PA 19102-1930, Attention: Edwin G. Ditlow, Telephone: 215-875-4184; Telecopy: 215-732-1203; E-mail: ditlowE@ctt.com. The parties
agree that the Escrow Agent shall be responsible for (x) organizing the issuance of the Title Commitment and Title Policy, (y)
preparation of the closing statement, and (z) collections and disbursement of the funds.


 


(f)“Guarantor”
shall mean FedEx Corporation.


 


(g)“Guaranty”
or “Guaranties” shall mean those certain guaranties of each of the Leases executed by Guarantor.


 


(h)“Lease”
or “Leases” shall mean those certain Leases described on Exhibit A2 attached hereto and made a part hereof
and referred to in Section 6(b)(i) of this Agreement between Seller or Seller’s Affiliates, as landlord, and FedEx Freight,
Inc. as tenant (“Tenant”), as amended.


 


(i)“LP
Agreement” shall mean that certain Amended and Restated Agreement of Limited Partnership of the Operating Partnership,
dated as of September 22, 2011, by and among the REIT, American Realty Capital II, LLC, a Delaware limited liability company, and
ARC Real Estate Partners, LLC, a Delaware limited liability company, including, but not limited to, certain restrictions on redemption
rights described in Section 8 thereof.


 


(j)“OP
Units” shall mean units of limited partnership interest in the Operating Partnership. The number of OP Units is set
forth in the “# of OP Unit” column on Exhibit A1 attached hereto. Each OP Unit shall be convertible into one (1) unit
of common stock in the “REIT”, subject to the terms and conditions set forth herein and in the LP Agreement, including,
but not limited to, certain restrictions on redemption rights described in Section 8 thereof.


 


(k)OP
Units Value” shall mean the closing market value of the REIT’s common stock two (2) business days prior to
the Effective Date.


 


(l)“Operating
Partnership” shall mean ARC Properties Operating Partnership, L.P., a Delaware limited partnership.


 


(m)“Property”
shall collectively mean (i) those certain parcels of real property, all of which are listed on Exhibit A1, together with all
right, title and interest of the Affiliates, if any, in and to the land lying in the bed of any street or highway in front of or
adjoining such real property, and all appurtenances and all the estate and rights of the Affiliates, if any, in and appurtenant
to such parcels of real property, including, without limitation, all appurtenant easements and rights-of-way, and Buildings (as
hereinafter defined) and all other improvements thereon, and all air and subsurface rights appurtenant to such parcels of real
property, as the case may be (such parcels of real property, together with all such rights and appurtenances, being collectively
referred to herein as the “Land”); (ii) all of the buildings and improvements (each individually called a “Building”
and collectively called the “Buildings”) situated on the Land; (iii) all right, title and interest of the Affiliates,
if any, in and to the lighting, electrical, mechanical, plumbing and heating, ventilation and air conditioning systems used in
connection with the Land and the Buildings, and all carpeting, draperies, appliances and other fixtures and equipment attached
or appurtenant to the Land together with all personal property (other than furniture, equipment not necessary to operate the Buildings
or building systems and not permanently affixed to the Buildings or Land, trade fixtures and inventory) owned by the Affiliates
and located on the Land or on and/or in the Buildings (collectively, the “Personal Property”); (iv) all right, title
and interest of the Affiliates in and to all warranties and guaranties respecting the Buildings and Personal Property; (v) to the
extent not otherwise described in subsection (i), all right, title and interest of the Affiliates in and to all leases respecting
the Buildings and Personal Property, including, without limitation, all prepaid rent or security or other deposits thereunder;
(vi) all right, title and interest of Seller in and to all licenses, permits, authorizations and approvals issued by any governmental
agency or authority which pertain to the Land and the Buildings, to the extent they exist and are transferable and assignable;
and (vii) to the extent the same are assignable, all site plans, surveys, and plans which relate to the Land. Any references to
“Property” in the singular, such as references to “a Property” or “each Property”, refer to
an individual parcel of Land and all matters described in (ii)-(vii) in connection with such Land.


 



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(n)
“Acquisition Price” shall mean the amount listed for each Property as set forth opposite the designation
of such Property on Exhibit A1 attached hereto. The Acquisition Price is based on the capitalization rates and the rents
set forth on Exhibit A2. If the rents on the Closing Date are not the same as set forth on Exhibit A2, the cash portion of the
Acquisition Price shall be adjusted accordingly. The Acquisition Price shall be comprised of cash and OP Units which shall be issued
to Seller on the Closing date in return for the balance of the Acquisition Price which represents the portion contributed to the
Approved Assignee.


 


(o)“REIT”
shall mean American Realty Capital Properties, Inc., a Maryland corporation.


 


(p)Seller
and Buyer’s Notice address 


 


(i)“Seller’s
Notice Address” shall be as follows, except as same may be changed pursuant to the Notice section herein:


 


Setzer Properties, LLC


Brett Setzer


858 Contract Street


Lexington, KY 40505


Tel. No.: (859)255-7901


Email: bsetzer@brettcon.com


 


And to:


 


Jeff Jefferson


Frost Brown Todd LLC


250 W. Main Street


Lexington, KY 40507


Tel. No.: (859)244-3266


Email: jjefferson@fbtlaw.com


 



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(ii)“Buyer’s
Notice Address” shall be as follows, except as same may be changed pursuant to the Notice section herein:


 


Michael Weil


c/o AR Capital, LLC


405 Park Avenue, 15th Floor


New York, NY 10022


Tel. No.: (215) 887-3054


Fax No.: (646) 861-7751


Email: wkahane@arlcap.com


 


And to:


 


Jesse Galloway


c/o AR Capital, LLC


405 Park Avenue, 15th Floor


New York, NY 10022


Tel. No.: (212) 415-6516


Fax No.: (646) 861-7751


Email: jgalloway@arlcap.com


 


And Due Diligence Materials (if
provided by email) to:


 


duediligence@arlcap.com


 


With hard copies and/or cds to:


 


James A. (Jim) Mezzanotte


c/o AR Capital, LLC


202 E Franklin Street


Monroe, NC 28112


Tel. No.: (212) 415-6570


Fax No.: (212) 415-6507


Email: jmezzanotte@arlcap.com


 


2.Acquisition
and Transfer of the Property. Subject to the terms of this Agreement, Seller agrees to transfer, or Seller shall cause Seller’s
respective Affiliate to transfer, to Buyer the Property for the Acquisition Price set forth above. Seller agrees that it shall
cause its Affiliates to perform all of the obligations of “Seller” hereunder with respect to the Property or Properties
owned by such Affiliate as set forth on Exhibit A1 provided that this shall not release Seller from the obligations of the “Seller”
under this Agreement.


 



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3.Acquisition
Price. 


 


(a)The
cash portion of the Acquisition Price to be paid by Buyer to Seller shall be paid by wire transfer of immediately available funds
to Escrow Agent, at the time of Closing, or as otherwise agreed to between Buyer and Seller.


 


(b)The
Buyer shall cause OP Units to be issued to Seller for that portion of the Acquisition Price being contributed by Seller, to each
Affiliate in accordance with Seller’s instructions


 


(c)In
the event this Agreement is terminated for any reason pursuant to the terms hereof with respect to one or more Properties, this
Agreement shall continue in full force and effect with respect to the remaining Properties and the Acquisition Price shall be reduced
by the amount shown on Exhibit A1 with respect to such terminated Property or Properties.


 


4.
Proration of Expenses and Payment of Costs and Recording Fees.


 





(a)All
real estate taxes, rollback taxes, personal property taxes, water and sewer use charges, and any other charges and assessments
constituting a lien on the Property (collectively “Taxes and Assessments”) due and payable on or before the Closing
Date shall be remitted to the collecting authorities or to the Escrow Agent by Seller prior to or at Closing. There shall be no
closing adjustments between the parties for Taxes and Assessments not yet due and payable at Closing unless Tenant is not responsible
for all such Taxes and Assessments due in accordance with the provisions of the Leases.


 


(b)All
rents shall be prorated as of the Closing Date with Buyer being credited for rent attributable to the day of Closing (provided
that the cash portion of the Acquisition Price is available to Seller no later than 2:00 p.m. on the Closing Date, otherwise Seller
shall be entitled to such rent) through and including the last day of the calendar month in which the Closing Date occurs; provided,
however, if the Closing Date shall occur within ten (10) days of the end of the month in which Closing occurs, Buyer and Seller
agree that Buyer shall be credited with the following month’s rent at Closing and Seller shall be entitled to all rents that
are attributable to the month following the month in which the Closing Date occurs and Buyer agrees to the extent that it receives
any rent attributable to such month which was adjusted at Closing, it will refund such amount to Seller as soon as reasonably possible.


 


(c)Seller
shall pay or be charged with the following costs and expenses in connection with this transaction which costs shall be referred
to as “Seller’s Closing Costs”:


 


(i)100% of all Owner’s
Title Insurance policy premiums, including search costs and any standard and customary endorsements issued in connection with such
policies; provided, that Buyer will cooperate with Seller to minimize the cost of the same;


 


(ii)Transfer taxes
and conveyance fees on the sale and transfer of the Properties; and


 


(iii)All fees relating
to the granting, executing and recording of the Deed for each Property and for any costs incurred in connection with the release
of existing debt, including, but not limited to, prepayment penalty fees and recording fees for documents providing for the release
of the applicable Property from the existing debt.



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(d)Buyer
shall pay or be charged with the following costs and expenses in connection with this transaction, which costs shall be referred
to as “Buyer’s Closing Costs”:


 


(i)all costs and
expenses in connection with Buyer’s financing, including appraisal, points, commitment fees and the like and costs for the
filing of all documents necessary to complete such financing and related documentary stamp tax and intangibles tax; and


 


(ii)Buyer shall pay
for the cost of its own survey, Phase 1 environmental study and due diligence investigations.


 


(e)Each party
shall pay its own legal fees incidental to the negotiation, execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby.


 


5. Title.
At Closing, Seller agrees to convey to Buyer fee simple marketable title to each Property by special warranty deed, free and clear
of all liens, defects of title, conditions, easements, assessments, restrictions, and encumbrances except for Permitted Exceptions
(as hereinafter defined).


 


6. Examination
of Property. Seller and Buyer hereby agree as follows:


 


(a)Buyer
shall order a title commitment (the “Title Commitment”) from Escrow Agent, a survey and a zoning report
for each Property promptly after the date hereof. All matters shown in the Title Commitment, survey or zoning report (“Title
Matters”) with respect to which Buyer fails to object prior to the expiration of the Due Diligence Period shall be
deemed “Permitted Exceptions”. However, Permitted Exceptions shall not include any mechanic’s lien
or any monetary lien, or any deeds of trust, mortgage, or other loan documents secured by the Property, (collectively, “Liens”).
Seller shall be required to cure or remove all Liens (by payment, bond deposit or indemnity acceptable to Escrow Agent). Seller
agrees to remove or cure any objections of Buyer which are submitted to Seller in writing and are of a nature that are capable
of being cured with reasonable efforts prior to Closing. Seller shall have no obligation to cure any Title Matter objected to,
except for any Liens, provided Seller notifies Buyer of any objections which Seller elects not to remove or cure within five (5)
business days following receipt of Buyer’s objections. In the event that Seller refuses to remove or cure any objections,
Buyer shall have the right to terminate this Agreement upon written notice to Seller given within five (5) business days after
receipt of Seller’s notice, upon which termination the Earnest Money shall be returned to Buyer and neither party shall have
any further obligation hereunder, except as otherwise expressly set forth herein. If any matter not revealed in the Title Commitment
is discovered by Buyer or by the Escrow Agent and is added to the Title Commitment by the Escrow Agent at or prior to Closing,
Buyer shall have until the earlier of (i) ten (10) days after the Buyer’s receipt of the updated, revised Title Commitment
showing the new title exception, together with a legible copy of any such new matter, or (ii) the date of Closing, to provide Seller
with written notice of its objection to any such new title exception (an “Objection”). If Seller does not remove or
cure such Objection prior to the date of Closing, Buyer may terminate this Agreement with respect to such Property, in which case
the Earnest Money shall be returned to Buyer, and neither party shall have any further obligation hereunder, except as otherwise
expressly set forth herein.


 



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(b)Within
five (5) days following the commencement of the Due Diligence Period, Seller shall provide to Buyer copies of the following documents
and materials pertaining to each Property to the extent within Seller’s possession or reasonably obtainable by Seller or
Seller’s counsel: (i) a complete copy of all leases affecting the Property and all amendments thereto and of all material
correspondence relating thereto; (ii) a copy of all surveys and site plans of the Property, including without limitation any as-built
survey obtained or delivered to tenants of the Property in connection with its construction; (iii) a copy of all architectural
plans and specifications and construction drawings and contracts for improvements located on the Property; (iv) a copy of Seller’s
title insurance commitments and policies relating to the Property; (v) a copy of the certificate of occupancy and zoning reports
for the Property; and of all governmental permits/approvals; (vi) a copy of all environmental, engineering and physical condition
reports for the Property; (vii) copies of the Property’s real estate tax bills for the current and prior two (2) tax years
or, if the Property has been owned by Seller for less than two (2) tax years, for the period of ownership; (viii) a copy of each
tenant sales reports for the previous twenty four (24) calendar months; (ix) the operating statements of the Property for the twenty
four (24) calendar months immediately preceding the Effective Date or if the Tenant has been operating for less than twenty-four
(24) months, for the period of operation; (x) all service contracts and insurance policies which affect the Property, if any; (xi)
a copy of all warranties relating to the improvements constructed on the Property, including without limitation any roof warranties;
(xii) a written inventory of all items of personal property to be conveyed to Buyer, if any; (xiii) the geotechnical recommendations
document that stipulates the daily traffic the asphalt installed is designed to withstand; and (xiv) a traffic study which indicates
the anticipated daily average traffic through a facility (the “Due Diligence Materials”). Seller shall
deliver any other documents relating to each Property reasonably requested by Buyer, to the extent within Seller’s possession
or reasonably obtainable by Seller or Seller’s counsel, within three (3) business days following such request. Additionally,
during the term of this Agreement, Buyer, its agents and designees, shall have the right to enter the Property for the purposes
of inspecting the Property, conducting soil tests, and making surveys, mechanical and structural engineering studies, inspecting
construction, and conducting any other investigations and inspections as Buyer may reasonably require to assess the condition and
suitability of the Property; provided, however, that such activities by or on behalf of Buyer on the Property shall not damage
the Property nor interfere with construction on the Property or the conduct of business by Tenant under the Lease; and provided
further, however, that Buyer shall indemnify and hold Seller harmless from and against any and all claims or damages to the extent
resulting from the activities of Buyer on the Property, and Buyer shall repair any and all damage caused, in whole or in part,
by Buyer and return the Property to its condition prior to such damage, which obligation shall survive Closing or any termination
of this Agreement. Seller shall reasonably cooperate with the efforts of Buyer and the Buyer’s representatives to inspect
the Property. After the Effective Date, Buyer shall be permitted to speak and meet with Tenant in connection with Buyer’s
due diligence. Upon signing this agreement, Seller shall provide Buyer with the name of a contact person(s) for the purpose of
arranging site visits. Buyer shall give Seller reasonable written notice (which in any event shall not be less than two (2) business
days) before entering the Property, and Seller may have a representative present during any and all examinations, inspections and/or
studies on the Property. Buyer shall have the unconditional right, for any reason or no reason, to terminate this Agreement as
to any Property by giving written notice thereof to Seller prior to the expiration of the applicable Due Diligence Period, in which
event this Agreement shall become null and void with respect to such Property, Buyer shall receive a refund of the Earnest Money,
and all rights, liabilities and obligations of the parties under this Agreement shall expire, except as otherwise expressly set
forth herein.


 



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(c)Within
two (2) business days following the commencement of the Due Diligence Period, Seller shall request Estoppel Certificates certified
to Buyer, the Approved Assignees and their Lender, successors and assigns (and simultaneously provide Buyer with a copy of such
request) and a Waiver of Tenant’s right of first refusal. It shall be a condition of Closing that Seller shall have obtained
an estoppel certificate from Tenant in the form required by the Lease and will use commercially reasonable efforts to obtain the
form attached hereto as Exhibit F for each Property (collectively, the “Tenant Estoppel Certificate”)
and an estoppel certificate from Guarantor substantially in the form attached hereto as Exhibit G for each Property (the “Guarantor
Estoppel Certificate”), and Seller shall use commercially reasonable good faith efforts to obtain the same. Seller
shall promptly deliver to Buyer photocopies or pdf files of the executed estoppel certificates when Seller receives the same.


 


(d)Seller
shall use commercially reasonable good faith efforts to obtain a subordination, non-disturbance and attornment agreement from Tenant
(the “SNDA”), which SNDA shall be consistent with the provisions of the Lease.


 


(e)Seller
shall use commercially reasonable good faith efforts to obtain estoppel certificates with respect to reciprocal easement agreements
as may be reasonably requested by Buyer.


 


7.
Risk of Loss/Condemnation Upon an occurrence of a casualty, condemnation or taking with respect to any Property, Seller
shall notify Buyer in writing of same. Until Closing, the risk of loss or damage to the Property, except as otherwise
expressly provided herein, shall be borne by Seller. In the event all or any portion of any Property is damaged in any
casualty or condemned or taken (or notice of any condemnation or taking is issued) so that: (a) Tenant has a right of
termination or abatement of rent under the Lease for such Property, or (b) with respect to any casualty, if the cost to
repair such casualty would exceed $500,000, or (c) with respect to any condemnation, any Building or access to the Property
or more than five percent (5%) of the Property is (or will be) condemned or taken, then, Buyer may elect to terminate this
Agreement with respect to each such Property by providing written notice of such termination to Seller within ten (10)
business days after Buyer’s receipt of notice of such condemnation, taking or damage, upon which termination a
proportionate part of the Earnest Money shall be returned to the Buyer in accordance with the Deposits as set forth on
Exhibit A1 and neither party hereto shall have any further rights, obligations or liabilities under this Agreement with
respect to such Property, except as otherwise expressly set forth herein. With respect to any condemnation or taking (of any
notice thereof), if Buyer does not elect to cancel this Agreement as aforesaid, there shall be no abatement of the
Acquisition Price and Seller shall assign to Buyer at the Closing the rights of Seller to the awards, if any, for the
condemnation or taking, and Buyer shall be entitled to receive and keep all such awards. With respect to a casualty, if Buyer
does not elect to terminate this Agreement with respect to any such Property or does not have the right to terminate this
Agreement as aforesaid, there shall be no abatement of the Acquisition Price and Seller shall assign to Buyer at the Closing
the rights of Seller to the proceeds under Seller’s insurance policies covering such Property with respect to such
damage or destruction (or pay to Buyer any such proceeds received prior to Closing) and pay to Buyer the amount of any
deductible with respect thereto, and Buyer shall be entitled to receive and keep any monies received from such insurance
policies.


 



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8.
Earnest Money Disbursement The Earnest Money shall be held by Escrow Agent, in trust, and disposed of only in accordance
with the following provisions:


 


(a)If
the Closing occurs, Escrow Agent shall deliver the Earnest Money to, or upon the instructions of, Seller and Buyer on the Closing
Date to be applied as part payment of the cash portion of the Acquisition Price. If for any reason the Closing does not occur,
Escrow Agent shall deliver the Earnest Money to Seller or Buyer only upon receipt of a written demand therefor from such party,
subject to the following provisions of this clause (a). Subject to the last sentence of this clause (a), if for any reason the
Closing does not occur and either party makes a written demand (the “Demand”) upon Escrow Agent for payment of the
Earnest Money, Escrow Agent shall give written notice to the other party of the Demand within one business day after receipt of
the Demand. If Escrow Agent does not receive a written objection from the other party to the proposed payment within five (5) business
days after the giving of such notice by Escrow Agent, Escrow Agent is hereby authorized to make the payment set forth in the Demand.
If Escrow Agent does receive such written objection within such period, Escrow Agent shall continue to hold such amount until otherwise
directed by written instructions signed by Seller and Buyer or a final judgment of a court. Notwithstanding the foregoing provisions
of this clause (a) if Buyer delivers a notice to Escrow Agent stating that Buyer has terminated this Agreement on or prior to the
expiration of the Due Diligence Period, then Escrow Agent shall immediately return the Earnest Money to Buyer without the necessity
of delivering any notice to, or receiving any notice from Seller.


 


(b)The
parties acknowledge that Escrow Agent is acting solely as a stakeholder at their request and for their convenience, that Escrow
Agent shall not be deemed to be the agent of either of the parties, and that Escrow Agent shall not be liable to either of the
parties for any action or omission on its part taken or made in good faith, and not in disregard of this Agreement, but shall be
liable for its negligent acts and for any liabilities (including reasonable attorneys’ fees, expenses and disbursements)
incurred by Seller or Buyer resulting from Escrow Agent’s mistake of law respecting Escrow Agent scope or nature of its duties.
Seller and Buyer shall jointly and severally indemnify and hold Escrow Agent harmless from and against all liabilities (including
reasonable attorneys’ fees, expenses and disbursements) incurred in connection with the performance of Escrow Agent’s
duties hereunder, except with respect to actions or omissions taken or made by Escrow Agent in bad faith, in disregard of this
Agreement or involving negligence on the part of Escrow Agent. Escrow Agent has executed this Agreement in the place indicated
on the signature page hereof in order to confirm that Escrow Agent has received and shall hold the Earnest Money in escrow, and
shall disburse the Earnest Money pursuant to the provisions of this Section 8.


 


9.Default


 



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(a)In
the event that Seller is ready, willing and able to close in accordance with the terms and provisions hereof, and Buyer is in material
default of any of its obligations undertaken in this Agreement, or in the event of the failure of a condition precedent set forth
in Section 14 of this Agreement, then in either case Seller shall be entitled to elect, as its sole and exclusive remedy, any one
(1) of the following: (i) if Buyer is willing to proceed to Closing, waive such default or condition precedent and proceed to Closing
in accordance with the terms and provisions hereof; (ii) declare this Agreement to be terminated, and Seller shall be entitled
to immediately receive all of the Earnest Money as liquidated damages as and for Seller’s sole remedy, or (iii) by notice
to Buyer given on or before the Closing Date, extend the Closing Date for a period of up to thirty (30) days (the “Closing
Extension Period”), and the “Closing Date” shall be moved to the last day of the Closing Extension Period. If
Seller so extends the Closing Date, then Buyer may, but shall not be obligated to, cause said conditions to be satisfied during
the Closing Extension Period. If Buyer does not cause said conditions to be satisfied during the Closing Extension Period, then
Seller shall have the remedies set forth in Section 9(a)(i) through (ii) above except that the term “Closing” shall
read “Extended Closing”. Upon such termination, neither Buyer nor Seller shall have any further rights, obligations
or liabilities hereunder, except as otherwise expressly provided herein. Seller and Buyer agree that (a) actual damages due to
Buyer’s default hereunder would be difficult and inconvenient to ascertain and that such amount is not a penalty and is fair
and reasonable in light of all relevant circumstances, (b) the amount specified as liquidated damages is not disproportionate to
the damages that would be suffered and the costs that would be incurred by Seller as a result of having withdrawn the Property
from the market, and (c) Buyer desires to limit its liability under this Agreement to the amount of the Earnest Money paid in the
event Buyer fails to complete Closing. Seller hereby waives any right to recover the balance of the Acquisition Price, or any part
thereof, and the right to pursue any other remedy permitted at law or in equity against Buyer. In no event under this Section or
otherwise shall Buyer be liable to Seller for any punitive, speculative or consequential damages.


 


(b)In
the event that Buyer is ready, willing and able to close in accordance with the terms and provisions hereof, and Seller is in material
default of any of its obligations undertaken in this Agreement, or in the event of the failure of a condition precedent set forth
in Section 13 of this Agreement, with respect to any or all of the Properties, then in either case Buyer may elect, as its sole
and exclusive remedy, any one (1) of the following: (i) if Seller is willing to proceed to Closing, waive such default or condition
precedent and proceed to Closing in accordance with the terms and provisions hereof; (ii) terminate this Agreement by delivering
written notice thereof to Seller no later than Closing, upon which termination the Earnest Money shall be refunded to Buyer, and
if Seller is in material default of any of its obligations undertaken in this Agreement, Seller shall pay to Buyer all of the reasonable,
documented out-of-pocket costs and expenses incurred by Buyer in connection with this Agreement in an amount not to exceed $15,000.00,
which return and payment shall operate to terminate this Agreement and release Seller and Buyer from any and all liability hereunder,
except those which are specifically stated herein to survive any termination hereof; (iii) enforce specific performance of Seller’s
obligations hereunder; or (iv) by notice to Seller given on or before the Closing Date, extend the Closing Date for the Closing
Extension Period, and the “Closing Date” shall be moved to the last day of the Closing Extension Period. If Buyer so
extends the Closing Date, then Seller may, but shall not be obligated to, cause said conditions to be satisfied during the Closing
Extension Period. If Seller does not cause said conditions to be satisfied during the Closing Extension Period, then Buyer shall
have the remedies set forth in Section 9(b)(i) through (iii) above except that the term “Closing” shall read “Extended
Closing”.


 



    	10



    	 



    

 


10.
Closing. The Closing shall consist of the execution and delivery of documents by Seller and Buyer with respect to each
Property as set forth below, and delivery by Buyer to Seller of the Acquisition Price in accordance with the terms of this Agreement.
Seller shall deliver to Escrow Agent for the benefit of Buyer at Closing the following executed documents for each Property:


 


(a)A
Special Warranty Deed in the form attached hereto as Exhibit B;


 


(b)An
Assignment and Assumption of Lease and Guaranty, in the form attached hereto as Exhibit C;


 


(c)A
Bill of Sale for the personal property, if any, in the form attached hereto as Exhibit D;


 


(d)An
Assignment of Contracts, Permits, Licenses and Warranties in the form of Exhibit E;


 


(e)An
original Tenant Estoppel Certificate dated no earlier than 30 days prior to the date of Closing. In addition, the business terms
of the Tenant Estoppel Certificate must be in accordance with and not contradict the Lease. If the Lease and any amendments, bearing
the original signatures of the landlord and tenant thereunder have not been delivered to Buyer previously, a copy thereof confirming
that the copy is true, correct and complete shall be attached to the Tenant Estoppel Certificate;


 


(f)To
the extent obtained by Seller, estoppel certificates with respect to reciprocal easement agreements as may be reasonably requested
by Buyer;


 


(g)An
original Guarantor Estoppel Certificate dated no earlier than 10 days prior to the date of Closing;


 


(h)A
settlement statement prepared by Escrow Agent setting forth the Acquisition Price, all prorations and other adjustments to be made
pursuant to the terms hereof, and the funds required for Closing as contemplated hereunder;


 


(i)All
transfer tax statements, declarations and filings as may be necessary or appropriate for purposes of recordation of the deed;


 


(j)Good
standing certificates and corporate resolutions or member or partner consents, as applicable, and such other documents as reasonably
requested by Escrow Agent;


 


(k)A
closeout book including an assignment of the warranties set forth on Exhibit I and the Contractors Warranty set forth on Exhibit
J (or an assignment of Seller’s rights under the AIA Contract with the Contractor);


 



    	11



    	 



    

 


(l)A
certificate pursuant to Section 1445 of the Internal Revenue Code of 1986, as amended, or the regulations issued pursuant thereto,
certifying the non foreign status of Seller;


 


(m)An
owner’s title affidavit as to mechanics’ liens and possession and other matters in customary form reasonably acceptable
to Buyer and Escrow Agent;


 


(n)An
original SNDA fully executed and notarized by Tenant;


 


(o)Letter
to Tenant in form of Exhibit H attached hereto;


 


(p)An
architect’s certificate certifying that the Property has been constructed in accordance with the approved plans and specifications;


 


(q)A
certificate of insurance or other evidence reasonably satisfactory to Buyer memorializing and confirming that Tenant is then maintaining
policies of insurance of the types and in the amounts required by the Lease; and


 


(r)Such
other instruments as are reasonably required by Buyer or Escrow Agent to close the escrow and consummate the acquisition of the
Property in accordance with the terms hereof.


 


At Closing, Buyer shall
(i) instruct Escrow Agent to deliver the Earnest Money to Seller which shall be applied to the cash portion of the Acquisition
Price, (ii) deliver the balance of the cash portion of the Acquisition Price to Seller, (iii) deliver to Escrow Agent for the benefit
of Seller a number of OP Units, in certificated form, equal to the aggregate OP Unit Value for each Seller set forth on Exhibit
A1 attached hereto and a copy of Exhibit A to the LP Agreement completed for Seller, and (iv) execute and deliver execution counterparts
of the closing documents referenced in clauses (b), (h) and (r) above. Buyer shall have the right to advance the Closing upon five
(5) days prior written notice to Seller; provided that all conditions precedent to both Buyer’s and Seller’s respective
obligations to proceed with Closing under this Agreement have been satisfied (or, if there are conditions to a party’s obligation
to proceed with Closing that remain unsatisfied, such conditions have been waived by such party). Buyer shall have a one time right
to extend the Closing for up to fifteen (15) business days upon written notice to Seller to be received by Seller on or prior to
the date scheduled for the Closing. If Buyer timely exercises this right to extend, any document that Seller is obligated to provide
that is “time sensitive” does not need to be provided again by Seller. The Closing shall be held through the mail by
delivery of the closing documents to the Escrow Agent on or prior to the Closing or such other place or manner as the parties hereto
may mutually agree.


 


11. Representations
by Seller. For the purpose of inducing Buyer to enter into this Agreement and to consummate the transfer and acquisition of
the Property in accordance herewith, Seller and each Affiliate (collectively referred to in this Section 11 as Seller) makes the
following representations and warranties to Buyer as of the date hereof and as of the Closing Date with respect to the applicable
Property:


 


(a)Seller
is duly organized (or formed), validly existing and in good standing under the laws of its state of organization, and to the extent
required by law, the State in which the Property is located. Seller has the power and authority to execute and deliver this Agreement
and all closing documents to be executed by Seller, and to perform all of Seller’s obligations hereunder and thereunder.
Neither the execution and delivery of this Agreement and all closing documents to be executed by Seller, nor the performance of
the obligations of Seller hereunder or thereunder will result in the violation of any law or any provision of the organizational
documents of Seller or will conflict with any order or decree of any court or governmental instrumentality of any nature by which
Seller is bound;


 



    	12



    	 



    

 


(b)Seller
has not received any written notice of any current or pending litigation, condemnation proceeding or tax appeals affecting Seller
or the Property and Seller does not have any knowledge of any pending litigation or tax appeals against Seller or the Property;
Seller has not initiated, nor is Seller participating in, any action for a change or modification in the current subdivision, site
plan, zoning or other land use permits for the Property;


 


(c)Seller
has not entered into any contracts, subcontracts or agreements affecting the Property which will be binding upon Buyer after the
Closing other than the Lease;


 


(d)Except
for violations cured or remedied on or before the date hereof, Seller has not received any written notice from (or delivered any
notice to) any governmental authority regarding any violation of any law applicable to the Property and Seller does not have knowledge
of any such violations;


 


(e)Seller
has fee simple title to the Property which at the Closing will be free and clear of all liens and encumbrances except for Permitted
Exceptions and Seller is the sole owner of the entire lessor’s interest in the Lease. The Property constitutes one or more
separate tax parcels for purposes of ad valorem taxation;


 


(f)With
respect to the Leases: (i) the Leases forwarded to Buyer under Section 6(b)(i) are true, correct and complete copies of the Leases;
(ii) the Leases are in full force and effect and there is no default thereunder; (iii) no brokerage or leasing commissions or other
compensation is or will be due or payable to any person, firm, corporation or other entity with respect to or on account of the
current term of the Leases or any extension or renewal thereof; (iv) Seller has no outstanding obligation to provide Tenant with
an allowance to construct, or to construct at its own expense, any tenant improvements; and (v) the rent for each Property is as
set forth on Exhibit A2;


 


(g)There
are no occupancy rights, leases or tenancies affecting the Property other than the Lease. Neither this Agreement nor the consummation
of the transactions contemplated hereby is subject to any first right of refusal or other purchase right in favor of any other
person or entity; and apart from this Agreement, Seller has not entered into any written agreements for the purchase or sale of
the Property, or any interest therein which has not been terminated;


 


(h)Seller
shall provide to Buyer at Closing an excise tax lien waiver or such other reasonably obtainable instruments evidencing compliance
with laws or payment of taxes to the extent required by the law of the relevant state, or an indemnification from a party reasonably
acceptable to Buyer for any resulting liability with respect to the period prior to the Closing;


 



    	13



    	 



    

 


(i)To
Seller’s actual knowledge, except as set forth in the environmental reports previously delivered by Seller to Buyer, no hazardous
substances have been generated, stored, released, or disposed of on or about the Property in violation of any law, rule or regulation
applicable to the Property which regulates or controls matters relating to the environment or public health or safety (collectively,
“Environmental Laws”). Seller has not received any written notice from (nor delivered any notice to) any federal, state,
county, municipal or other governmental department, agency or authority concerning any petroleum product or other hazardous substance
discharge or seepage. For purposes of this Subsection, “hazardous substances” shall mean any substance or material
which is defined or deemed to be hazardous or toxic pursuant to any Environmental Laws. To Seller’s actual knowledge, there
are no underground storage tanks located on the Property; and


 


(j)Exhibit
I attached hereto is a true, correct and complete listing of all warranties in effect for the Property (the “Warranties”).


 


The representations
and warranties of Seller shall survive Closing for a period of six (6) months.


 


12.
Representations by Buyer. Buyer represents and warrants to, and covenants with, Seller as follows:


 


(a)Buyer
is duly formed, validly existing and in good standing under the laws of Delaware, is authorized to consummate the transaction set
forth herein and fulfill all of its obligations hereunder and under all closing documents to be executed by Buyer, and has all
necessary power to execute and deliver this Agreement and all closing documents to be executed by Buyer, and to perform all of
Buyer’s obligations hereunder and thereunder. This Agreement and all closing documents to be executed by Buyer have been
duly authorized by all requisite corporate or other required action on the part of Buyer and are the valid and legally binding
obligation of Buyer, enforceable in accordance with their respective terms. Neither the execution and delivery of this Agreement
and all closing documents to be executed by Buyer, nor the performance of the obligations of Buyer hereunder or thereunder will
result in the violation of any law or any provision of the organizational documents of Buyer or will conflict with any order or
decree of any court or governmental instrumentality of any nature by which Buyer is bound.


 


The representations
and warranties of Buyer shall survive Closing for a period of six (6) months.


 


13. Conditions
Precedent to Buyer’s Obligations. Buyer’s obligation to pay the Acquisition Price, and to accept title to each
Property, shall be subject to compliance by Seller or Affiliate, as the case may be, with the following conditions precedent for
such Property on and as of the date of Closing:


 


(a)Seller
shall deliver to Buyer or Escrow Agent on or before the Closing the items required to be delivered by Seller as set forth in Section
10 above;


 



    	14



    	 



    

 


(b)Buyer
shall receive from Escrow Agent or any other title insurer approved by Buyer in its judgment and discretion, a current ALTA owner’s
form of title insurance policy, or irrevocable and unconditional binder to issue the same, with extended coverage for the Property
in the amount of the Acquisition Price, dated, or updated to, the date of the Closing, insuring, or committing to insure, at its
ordinary premium rates Buyer’s good and marketable title in fee simple to the Property and otherwise in such form and with
such endorsements as provided in the title commitment approved by Buyer pursuant to Section 6 hereof and subject only to the Permitted
Exceptions (the “Title Policy”);


 


(c)Buyer
shall have received a valid and permanent final certificate of occupancy (or the equivalent thereof) for the Property;


 


(d)Tenant
shall be in possession of the premises demised under the Leases, open for business to the public and paying full and unabated rent
under the Leases and Tenant shall not have assigned or sublet any of the Property;


 


(e)The
representations and warranties of Seller contained in this Agreement shall have been true in all material respects when made and
shall be true in all material respects at and as of the date of Closing as if such representations and warranties were made at
and as of the Closing, and Seller shall have performed and complied in all material respects with all covenants, agreements and
conditions required by this Agreement to be performed or complied with by Seller prior to or at the Closing;


 


(f)Seller
shall have delivered to Buyer a written waiver by Tenant of any right of first refusal, right of first offer or other purchase
option that Tenant has pursuant to the Leases to purchase the Property from Seller; and


 


(g)Seller
shall have made all contributions, payments and/or reimbursements and completed any and all work required by any governmental authority
in connection with the construction and development of the Property, including, without limitation, as required by any variance
or site plan approval.


 


In the event that the
foregoing conditions precedent have not been satisfied as of Closing, Buyer shall have the rights and remedies set forth in Section
9(b) of this Agreement.


 


14.
Conditions Precedent to Seller’s Obligations. Seller’s obligation to deliver title to the Property shall be
subject to compliance by Buyer with the following conditions precedent on and as of the date of Closing:


 


(a)Buyer
shall deliver to Seller or Escrow Agent on or before the Closing Date the remainder of the Acquisition Price;


 


(b)Buyer
shall deliver to Seller or Escrow Agent on or before the Closing the items required to be delivered by Buyer as set forth in Section
10 above; and


 


(c)The
representations and warranties of Buyer contained in this Agreement shall have been true in all material respects when made and
shall be true in all material respects at and as of the date of Closing as if such representations and warranties were made at
and as of the Closing, and Buyer shall have performed and complied in all material respects with all covenants, agreements and
conditions required by this Agreement to be performed or complied with by Buyer prior to or at the Closing.


 



    	15



    	 



    

 


In the event
that the foregoing conditions precedent have not been satisfied as of Closing, Seller shall have the rights and remedies set forth
in Section 9(a) of this Agreement.


 


15.
Notices. Unless otherwise provided herein, all notices and other communications which may be or are required to be given
or made by any party to the other in connection herewith shall be in writing and shall be deemed to have been properly given and
received on the date: (i) delivered by facsimile transmission or by electronic mail (e.g. email), (ii) delivered in person, (iii)
deposited in the United States mail, registered or certified, return receipt requested, or (iv) deposited with a nationally recognized
overnight courier, to the addresses set out in Section 1, or at such other addresses as specified by written notice delivered
in accordance herewith. Notwithstanding the foregoing, Seller and Buyer agree that notice may be given on behalf of each party
by the counsel for each party and notice by such counsel in accordance with this Section 15 shall constitute notice under this
Agreement.


 


16. Seller
Covenants. Seller agrees that Seller and/or each Affiliate with respect to each Property: (a) shall continue to operate and
manage the Property in the same manner in which Seller has previously operated and managed the Property or shall use good faith
efforts to complete construction of the Buildings in a prompt and timely manner; (b) shall, subject to Section 7 hereof and subject
to reasonable wear and tear, maintain each Property in the same (or better) condition as exists on the date hereof; and (c) shall
not, without Buyer’s prior written consent, which, after the expiration of the Due Diligence Period may be withheld in Buyer’s
sole discretion: (i) amend the Leases in any manner, nor enter into any new lease, license agreement or other occupancy agreement
with respect to any Property; (ii) consent to an assignment of the Leases or a sublease of the premises demised thereunder or
a termination or surrender thereof; (iii) terminate the Leases nor release any guarantor of or security for the Leases unless
required by the express terms of the Leases; and/or (iv) cause, permit or consent to an alteration of the premises demised thereunder
(unless such consent is non-discretionary). Seller shall promptly inform Buyer in writing of any material event adversely affecting
the ownership, use, occupancy or maintenance of any Property, whether insured or not.


 


17.Matters
related to the OP Units and Redemption Shares. Buyer makes the following representations, warranties and covenants regarding
the OP Units and the Redemption Shares. Capitalized terms used in this Section and not defined elsewhere in this Agreement have
the meanings given in the LP Agreement.


 


(a)As of the Effective Date, the
Conversion Factor is 1.0.


 


		(b)	Notwithstanding any provision of this Agreement or the LP Agreement to the contrary, Seller shall
be entitled to exercise its OP Unit Redemption Right at any time and from time to time following the Closing, subject to applicable
laws and regulations.



 



    	16



    	 



    

 


		(c)	Notwithstanding any provision of this Agreement or the LP Agreement to the contrary, Buyer shall
cause the filing of a registration with the Commission which registers Seller’s OP Unit equivalent of Redemption Shares and
use commercially reasonable efforts to obtain the Commission’s approval to allow such Redemption Shares to be freely transferrable
and marketable after conversion of the Seller’s OP Units, on the later of (i) the date that is two (2) months following the
issuance of the OP Units, and (ii) September 1, 2012.



 


		(d)	Notwithstanding Section 9.02 of the LP Agreement, Seller shall be entitled to pledge or encumber
its OP Units and/or Redemption Shares, and such pledge or encumbrance shall be subject to the terms and conditions of the LP Agreement
and applicable laws and regulations.



 


18. Performance on Business Days.
A "business day" is a day which is not a Saturday, Sunday or legal holiday recognized by the Federal Government. Furthermore,
if any date upon which or by which action is required under this Agreement is not a business day, then the date for such action
shall be extended to the first day that is after such date and is a business day.


 


19.
Entire Agreement. This Agreement constitutes the sole and entire agreement among the parties hereto and no modification
of this Agreement shall be binding unless in writing and signed by all parties hereto. No prior agreement or understanding pertaining
to the subject matter hereof (including, without limitation, any letter of intent executed prior to this Agreement) shall be valid
or of any force or effect from and after the date hereof.


 


20.
Severability. If any provision of this Agreement, or the application thereof to any person or circumstance, shall be invalid
or unenforceable, at any time or to any extent, then the remainder of this Agreement, or the application of such provision to
persons or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby. Each provision
of this Agreement shall be valid and enforced to the fullest extent permitted by law


 


21.
No Representations or Warranties. Buyer hereby acknowledges, understands and agrees that it has an opportunity to inspect
the Property as set forth in Section 6 herein, and except as expressly set forth in this Agreement, the Property shall be conveyed
at Closing to Buyer in “as-is” condition with no representation or warranties whatsoever.


 


22.
Applicable Law. This Agreement shall be construed under the laws of the State or Commonwealth in which the Property is
located, without giving effect to any state's conflict of laws principles.


 


23.
Intentionally Omitted.


 





24. Broker’s
Commissions. Buyer and Seller each hereby represent that there are no brokers involved or that have a right to proceeds
in this transaction. Seller and Buyer each hereby agree to indemnify and hold the other harmless from all loss, cost, damage
or expense (including reasonable attorneys' fees at both trial and appellate levels) incurred by the other as a result of any
claim arising out of the acts of the indemnifying party (or others on its behalf) for a commission, finder's fee or similar
compensation made by any broker, finder or any party who claims to have dealt with such party. The representations,
warranties and indemnity obligations contained in this section shall survive the Closing or the earlier termination of this
Agreement.


 



    	17



    	 



    

 


25.
Assignment. Buyer may assign its rights under this Agreement, provided, however, that no such assignment shall relieve
Buyer of any of its obligations hereunder until Closing is complete. Buyer is entering into this Agreement for and on behalf of
related special purpose entities as set forth on Exhibit A1 (each an “Approved Assignee”) and intends to assign each
respective Approved Assignee its rights hereunder prior to Closing.


 


26. Attorneys’ Fees.
In any action between Buyer and Seller as a result of failure to perform or a default under this Agreement, the prevailing
party shall be entitled to recover from the other party, and the other party shall pay to the prevailing party, the prevailing
party’s attorneys’ fees and disbursements and court costs incurred in such action.


 


27.Time
of the Essence. Time is of the essence with respect to each of Buyer’s and Seller’s obligations hereunder.


 


28. Counterparts.
This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and
shall become a binding agreement when one or more counterparts have been signed by each of the parties and delivered to the other
party. Signatures on this Agreement which are transmitted by electronically shall be valid for all purposes, however any party
shall deliver an original signature on this Agreement to the other party upon request.


 


29. Anti-Terrorism.
Neither Buyer or Seller, nor any of their affiliates, are in violation of any Anti-Terrorism Law (as hereinafter defined) or engages
in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to
violate, any of the prohibitions set forth in any Anti-Terrorism Law. “Anti-Terrorism Laws” shall mean any laws relating
to terrorism or money laundering, including: Executive Order No. 13224; the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56, as the same has been, or may hereafter be,
renewed, extended, amended or replaced; the applicable laws comprising or implementing the Bank Secrecy Act; and the applicable
laws administered by the United States Treasury Department’s Office of Foreign Asset Control (as any of the foregoing may
from time to time be amended, renewed, extended, or replaced).


 


30.Several
and Not Joint. The representations, warranties, covenants and agreements of Seller and each Affiliate contained herein and/or
in any Exhibit hereto shall be construed on a several and not joint basis with respect to each such party and each Property; it
being understood that no Affiliate makes any representation, warranty, covenant or agreement relating to any Property other than
the Property owned or leased by such Affiliate. In the event of any breach of a representation, warranty, covenant or agreement
by any Affiliate or relating to any Property, none of the other Affiliates or other Properties shall have any liability therefor.


 


 


 



    	18



    	 



    

 


[SIGNATURES APPEAR ON THE FOLLOWING PAGES]


 



    	19



    	 



    

IN WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the Effective Date.


 





	BUYER:	SELLER:
	 	 
	
        ARC Properties Operating Partnership, L.P.,

        a Delaware limited partnership

         

        By: /s/ Edward M. Weil, Jr.

        Name: Edward M. Weil, Jr

        Title: President

         

        Date: May 2, 2012
	
        SETZER PROPERTIES, LLC

        a Kentucky limited liability company

         

        By: /s/ Brett T. Setzer

        Name: Brett T. Setzer

        Title: Managing Member

         

        Date: May 4, 2012

         



 


 


THE UNDERSIGNED HEREBY ACKNOWLEDGES AND
AGREES TO BE BOUND BY THE TERMS OF THIS AGREEMENT RELATING TO ESCROW AGENT AND THE DEPOSIT.


 


ESCROW AGENT:


 


CHICAGO TITLE INSURANCE COMPANY


 


By: /s/ Edwin G. Ditlow


 


Name: Edwin G. Ditlow


 


Title: Vice President


 


Date: May 7, 2012


 


 


 



    	S-1



    	 



    

JOINDER


 


The undersigned,
being the Affiliates identified in the foregoing Agreement, hereby join in the execution of the Agreement with the intention of
being legally bound hereby and agree to execute and deliver a Deed as required under the terms of the Agreement with respect to
the Property set opposite the name of the Affiliate on Exhibit “A1” to the Agreement.


 


 


 


SETZER INVESTMENTS #3, LLC


 


By: _________________________


 


 


 


SETZER INVESTMENTS #5, LLC


 


By: _________________________


 


 



    	 



    	 



    

 


EXHIBITS


 


	Exhibit A1	-	List of Properties
	Exhibit A2	-	List of Leases and Rents
	Exhibit B	-	Form of Special Warranty Deed
	Exhibit C	-	Form of Assignment and Assumption of Lease and Guaranty
	Exhibit D	-	Form of Bill of Sale
	Exhibit E	-	Form of Assignment of Contracts, Permits, Licenses and Warranties
	Exhibit F	-	Form of Tenant Estoppel
	Exhibit G	-	Form of Guarantor Estoppel
	Exhibit H	-	Form of Tenant Notice
	Exhibit I	-	Warranties
	Exhibit J	-	General Contractor Warranty


 


 



    	 



    	 



    

 


 


EXHIBIT A1


 


LIST OF PROPERTIES


 


	FedEx Distribution Facilities - 6 Pack	 	 	 	 	 	 	 	 	 
	Owner Name	City	ST	Bldg. sq.ft.	Approved Assignee	Deposit	OP Unit Value	# of OP Units	Cash	Acquisition Price
	Setzer Investments #3, LLC	Mt. Vernon	IL	15,700	ARCP FEMTVIL01, LLC	$10,126	[TBD]	[TBD]	[TBD]	$1,600,000
	Setzer Investments #3, LLC	Evansville	IN	20,200	ARCP FEEVLIN01, LLC	$23,842	[TBD]	[TBD]	[TBD]	$3,767,215
	Setzer Investments #5, LLC	Mt. Pleasant	PA	20,200	ARCP FEMTPPA01, LLC	$15,400	[TBD]	[TBD]	[TBD]	$2,433,333
	Setzer Investments #3, LLC	Chillicothe	OH	12,555	ARCP FECCTOH01, LLC	$9,704	[TBD]	[TBD]	[TBD]	$1,533,333
	Setzer Investments #3, LLC	London	KY	12,140	ARCP FELDNKY01, LLC	$8,607	[TBD]	[TBD]	[TBD]	$1,360,000
	Setzer Investments #3, LLC	Kankakee	IL	12,140	ARCP FEKKEIL01, LLC	$9,226	[TBD]	[TBD]	[TBD]	$1,457,778
	 	 	 	 	 	 	 	 	 	 
	Totals	 	 	 	 	$76,906	$6,351,659	[TBD]	$5,800,000	$12,151,659


 


 


 



    	A-1



    	 



    

EXHIBIT A2


 


LIST OF LEASES AND RENTS


 


 





 






    	A-2



    	 



    

EXHIBIT B


 


FORM OF SPECIAL WARRANTY DEED

[Subject to Local Counsel Review]


 


This document prepared by:

(and return to:)


 


___________________________

___________________________

___________________________

___________________________


 


 


Tax Parcel No. ______________________________


 


SPECIAL WARRANTY DEED


 


THIS INDENTURE, made
on the _____ day of ______________, 2012, by and between ___________________________________, a ___________________________ ("Grantor"),
and ________________________________________, a ______________, whose address is ________________________________ ("Grantee")


 


W I T N E S S E T H:


 


THAT Grantor, in
consideration of the sum of Ten Dollars ($10.00) and other good and valuable consideration, the receipt of which is hereby acknowledged,
does by these presents, transfer and convey unto the said Grantee, its successors and assigns, the lots, tracts or parcels of land
lying, being and situated in the County of ____________, State of _____________, and more fully described on Exhibit "A"
attached hereto and incorporated herein by reference, together with all buildings, facilities and other improvements, located thereon.


 


TO HAVE AND TO
HOLD the premises aforesaid with all and singular, the rights, easements, privileges, appurtenances and immunities thereto belonging
or in any ways appertaining unto the said Grantee and unto Grantee's successors and assigns forever, the said Grantor hereby covenanting
that Grantor will warrant and defend the title to said premises unto the said Grantee and unto Grantee's successors and assigns,
against the lawful claims and demands of all persons claiming under or through Grantor, but not otherwise.


 



    	B-1



    	 



    

IN WITNESS WHEREOF,
Grantor has executed this Special Warranty Deed the day and year first above written.


 


GRANTOR:


 


 





By:                                         





Name:_______________________________





Its:_______________________________


 


 


[ACKNOWLEDGMENT]


 


 


 



    	B-2



    	 



    

Exhibit A to Special Warranty Deed


 


Description of Property





 



    	 



    	 



    

 


EXHIBIT C


 


FORM OF

ASSIGNMENT AND ASSUMPTION OF LEASE AND GUARANTY


 


______________________________
("Assignor"), in consideration of the sum of Ten and No/100 Dollars ($10.00) in hand paid and other good and valuable
consideration, the receipt of which is hereby acknowledged, hereby assigns, transfers, sets over and conveys to ______________________________
("Assignee"), all of Assignor's right, title and interest in and to that certain Lease dated _________________________________,
between Assignor and _____________________________ (as amended from time to time, the “Lease”), including any and all
security deposits under the Lease. [together with all of Assignor’s right, title and interest in and to that certain Guaranty
of Lease dated _________________________________, between Assignor and _____________________________ (as amended from time to time,
the “Guaranty”).]


 


Subject to the limitations
set forth below, Assignor does hereby agree to defend, indemnify and hold harmless Assignee from any liability, damages (excluding
speculative damages, consequential damages and lost profits), causes of action, expenses and reasonable attorneys' fees incurred
by Assignee by reason of the failure of Assignor to have fulfilled, performed and discharged all of the various commitments, obligations
and liabilities of the lessor, or landlord under and by virtue of the Lease prior to the date of this Assignment. Subject to the
limitations set forth below, Assignee does hereby agree to defend, indemnify and hold harmless Assignor from any liability, damages
(excluding speculative damages, consequential damages and lost profits), causes of action, expenses and reasonable attorneys' fees
incurred by Assignor by reason of the failure of Assignee to have fulfilled, performed and discharged all of the various commitments,
obligations and liabilities of the Landlord under and by virtue of the Lease on and after the date of this Assignment.


 


IN WITNESS WHEREOF,
Assignor and Assignee have executed this Assignment this ______ day of ______________, 2012, which Assignment is effective this
date. This Assignment may be executed in counterparts, which when taken together shall be deemed one agreement.


 


 


ASSIGNOR:


 


_______________________________


 


By: _______________________________


		Name:	_______________________________



		Title:	_______________________________




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ASSIGNEE:


 


_______________________________


 


 


By: _______________________________


Name: _______________________________


Title: _______________________________



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EXHIBIT D


 


FORM OF BILL OF SALE


 


For valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, ______________________________, a ___________________________, having
an address at ____________________________ (“Seller”), hereby bargains, transfers, conveys and transfers to ____________________________
(“Buyer”), a _______________________________, all of Seller’s right, title and interest in and to those certain
items of personal and intangible property (including any warranty made by third parties in connection with the same and the right
to sue on any claim for relief under such warranties) (the “Personal Property”) located at or held in connection with
that certain real property located at __________________________.


 


Seller has not made
and does not make any express or implied warranty or representation of any kind whatsoever with respect to the Personal Property,
including, without limitation, with respect to title, merchantability of the Personal Property or its fitness for any particular
purpose, the design or condition of the Personal Property; the quality or capacity of the Personal Property; workmanship or compliance
of the Personal Property with the requirements of any law, rule, specification or contract pertaining thereto; patent infringement
or latent defects. Buyer accepts the Personal Property on an “as is, where is” basis.


 


IN WITNESS WHEREOF,
Seller has caused this instrument to be executed and delivered as of this ___ day of _______, 2012.


 


SELLER:


 


 


 


By: _______________________________





Name: _______________________________





Title: _______________________________


 



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EXHIBIT E


 


FORM OF ASSIGNMENT OF CONTRACTS,

PERMITS, LICENSES AND WARRANTIES


 


THIS ASSIGNMENT, made
as of the ___ day of ________, 2012 by _________________, a __________________________ (“Assignor”), to _____________________________,
a __________________________________________(“Assignee”).


 


W I T N E S S E T H:


 


WHEREAS, by Agreement
of Acquisition and Transfer of Real Property (the “ Acquisition Agreement”) dated as of ________, 2012, between Assignor
and Assignee, Assignee has agreed to acquire from Assignor as of the date hereof, and Assignor has agreed to transfer to Assignee,
that certain property located at ________________________ (the “Property”); and


 



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WHEREAS, Assignor desires
to assign to Assignee as of the date hereof all of Assignor’s right, title and interest in contracts, permits, trademarks,
licenses and warranties held by Assignor in connection with the Property, including without limitation any and all guaranties of
leases relating to the Property (collectively, the “Contracts”).


 


NOW THEREFORE, in consideration
of the premises and the mutual covenants herein contained, the Assignor hereby assigns, sets over and transfers unto Assignee to
have and to hold from and after the date hereof all of the right, title and interest of Assignor in, to and under the Contracts,
to the extent assignable. Assignor agrees without additional consideration to execute and deliver to Assignee any and all additional
forms of assignment and other instruments and documents that may be reasonably necessary or desirable to transfer or evidence the
transfer to Assignee of any of Assignor's right, title and interest to any of the Contracts.


 


This Assignment shall
be governed by the laws of the State of _____________, applicable to agreements made and to be performed entirely within said State.


 


IN WITNESS WHEREOF,
Assignor has duly executed this Assignment as of the date first above written.


 


ASSIGNOR:


  


a _______________________________


 


By: _______________________________


Name: _______________________________


Title: _______________________________



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EXHIBIT F


 


[To use estoppel attached to lease]


 


FORM OF TENANT ESTOPPEL


 


The undersigned hereby
certifies to AR Capital, LLC and ARC 001, LLC (“Buyer”), ___________________ (“Lender”) and their respective
successors and assigns as follows:


 


1.The undersigned
is the tenant under that certain [Lease Agreement] dated as of _________ __, ____, [as amended by [insert any modifications to
Lease] ([collectively,] the “Lease”) by and between _________________________ (“Landlord”) and _________________________
(“Tenant”), pursuant to which Tenant leases that real property located at _________________________________________
(the “Premises”).


 


2.Except as set
forth above, the Lease has not been modified, changed, altered, supplemented or amended in any respect, nor have any provisions
thereof been waived.


 


3.The Lease is
valid and in full force and effect on the date hereof. The Lease represents the entire agreement between Landlord and Tenant with
respect to the Premises and the land on which the Premises are situated.


 


4.Tenant is not
entitled to, and has made no agreement with Landlord or its agents or employees concerning, free rent, partial rent, rebate of
rent payments, credit or offset or reduction in rent, or any other type of rental concession including, without limitation, lease
support payments, lease buy-outs, or assumption of any leasing or occupancy agreements of Tenant.


 


5.The initial term
of the Lease began on __________ __, _____ and expires on ________ __, 20__. The Rent Commencement Date was __________ __, ____.
Tenant has accepted possession of the Premises and is open for business. Tenant has not sublet all or a portion of the Premises
to any sublessee and has not assigned, transferred or encumbered any of its rights or interests under the Lease.


 


6.Tenant has no
outstanding options or rights to renew or extend the term of the Lease. Tenant has no outstanding expansion options, other options,
rights of first refusal or rights of first offer to purchase the Premises or any part thereof and/or the land on which the Premises
are situated, or rights of first offer to lease with respect to all or any part of the Premises.


 


7.The [Base Annual
Rent] payable under the Lease is $____________ ($_________ monthly). Such [Base Annual Rent] payable under the Lease shall be adjusted
during the initial term of the Lease as follows: (a) from ___________, 20__ to and including ______________, 20__, the Base Annual
Rent shall be $_______ ($_______ monthly), (b) from ___________, 20___ to and including ____________, 20___ the Base Annual Rent
shall be $________ ($________ monthly); [and from __________, 20__ to and including __________, 20___ the fixed annual minimum
rent shall be $_________ ($__________ monthly)]. Such rent has been paid through and including the month of ____________, 200_.
Additional rent under the Lease has been paid through and including the month of __________, 200_. No such rent (excluding security
deposits) has been paid more than one (1) month in advance of its due date.


 



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8.Tenant's security
deposit, if any, is $_________________ (if none, please state “none”).


 


9.No event has
occurred and no condition exists that constitutes, or that with the giving of notice or the lapse of time or both, would constitute,
a default by Tenant or, to the best knowledge of Tenant, Landlord under the Lease. Tenant has no existing defenses or offsets against
the enforcement of the Lease by Landlord.


 


10.(a)All required
contributions by Landlord to Tenant on account of Tenant's improvements have been received by Tenant and all of Tenant's tenant
improvements have been completed in accordance with the terms of the Lease.


 


(b)Landlord has
satisfied all its obligations to Tenant arising out of or incurred in connection with the construction of the tenant improvements
on the Premises and no off-set exists with respect to any rents or other sums payable or to become payable by the Tenant under
the Lease.


 


11.The undersigned
is duly authorized to execute this Certificate on behalf of Tenant.


 


Dated: ____________,
2012


 


TENANT:


 


____________________,
a ________________


 


By:______________

Name:_______________________________

Title:_______________________________



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EXHIBIT G


 


[Use same form as in Springfield transaction]


 


GUARANTOR ESTOPPEL CERTIFICATE


 


The undersigned hereby
certifies to AR Capital, LLC and ARC 001, LLC (“Buyer”), ___________________ (“Lender”) and
their respective successors and assigns as follows:


 


1.The
undersigned (“Guarantor”) is the guarantor of that certain [Lease Agreement] dated as of _____________ __, ____,
as amended by [insert amendments] ([collectively,] the “Lease”) by and between ________________________ (“Landlord”)
and __________________________ (“Tenant”), pursuant to which Tenant leases from Landlord the land and building
located at _______________________________, as more particularly described in the Lease (the “Premises”). Such
guaranty is made pursuant to that certain Guarantee dated as of ________ __, ____ (the “Guaranty”) from Guarantor
to Landlord.


 


2.The
Guaranty has not been modified, changed, altered, supplemented or amended in any respect, nor have any provisions thereof been
waived.


 


3.The
Guaranty is valid and in full force and effect on the date hereof.


 


4.No
voluntary actions or, to Guarantor’s best knowledge, involuntary actions are pending against Guarantor under the bankruptcy
laws of the United States or any state thereof.


 


5.This
Certificate is delivered to induce Buyer to acquire the Premises and Lender to provide financing in connection with such acquisition,
with the understanding that Buyer and Lender shall rely upon the truth of the matters set forth in this Certificate.


 


The undersigned
is duly authorized to execute this Certificate on behalf of Guarantor.


 


Dated: ____________, 2012


 


GUARANTOR:


 


______________, a ___________________


 


 


By:_______________________________


Name:_______________________________


Title:_______________________________



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EXHIBIT H


 


FORM OF NOTICE TO TENANT


 


TO:[Tenant]


 


 


 


Re:Notice of Change of Ownership of ______________________________


 


Ladies and Gentlemen:


 


YOU ARE HEREBY NOTIFIED AS FOLLOWS:


 


That as of the date
hereof, the undersigned has transferred, sold, assigned, and conveyed all of its right, title and interest in and to the above-described
property, (the “Property”) to [INSERT NAME OF BUYER] (the “New Owner”) and assigned to New Owner, all of
the undersigned’s right, title and interest under that certain Lease, dated _________, between ________as tenant and ____________as
landlord (the “Lease”), together with any security deposits or letters of credit held thereunder.


 


Accordingly, New Owner
is the landlord under the Lease and future notices and correspondence with respect to your leased premises at the Property should
be made to the New Owner at the following address:


  


You will receive a
separate notification from New Owner regarding the new address for the payment of rent. In addition, to the extent required by
the Lease, please amend all insurance policies you are required to maintain pursuant to the Lease to name New Owner as an additional
insured thereunder and promptly provide New Owner with evidence thereof.


 


Very truly yours,


[PRIOR LANDLORD)


 


 


By: _______________________________


Name: _______________________________


Title: _______________________________



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EXHIBIT
I


 



    	I-1



    	 



    

EXHIBIT J


 


LETTER OF WARRANTY


 


___________ __, 2012


[name of Landlord]


[name of Tenant]


 


Re:____________________________, Store
No. (the “Project”)


 


____________ (“Contractor”)
hereby guarantees to _____________, its successors and assigns (“Landlord”) all work performed by it or any subcontractor
on the Project to be structurally sound, constructed in accordance with applicable law, the plans prepared by ______________ (the
“Architect”) and the [identify any tenant specifications] (the “Tenant Specifications”) and that all materials
and equipment furnished by it or any subcontractor and work performed by it or any subcontractor on the Project shall be free from
defects in materials and workmanship (collectively, the “Work”) for the greater of (a) one year after the date ________________
(“Tenant”) accepts possession of the Project (the “Warranty Commencement Date") (except that such warranties
shall survive for the first three (3) years after the Warranty Commencement Date as to defective conditions (including without
limitation, conditions which do not comply with the Tenant Specifications or applicable law) which could not be discovered by Landlord
or Tenant in the exercise of reasonable care within one (1) year after the Warranty Commencement Date) or (b) any time periods
set forth in the Tenant Specifications, and that there shall be no structural movement resulting from the failure of Contractor
causing damage to any portion of any structure on the Project. All subcontractors’ guaranties and any warranties therein
specified shall be underwritten by Contractor who shall obtain and deliver the same to Landlord before the Work will be deemed
finished and accepted. Contractor's warranties as set forth in this contract shall be assignable to Tenant, any other tenant of
the project, as applicable and/or any successor Landlord of the Project. If any such damage should occur during any guaranty period,
or if there shall be any defect in the work, Contractor will make all necessary repairs, in the judgment of Architect, to the work
without further costs to Landlord, and shall promptly reimburse Landlord for consequential damages, if any, suffered as a result
of the defect or the settling or structural movement. If such repairs are not completed within seven (7) days following notification
to the Contractor of the need for repairs, or, in the event of an emergency, 24 hours following such notification, or, if additional
time is requested by Contractor, within such reasonable time as is allowed by Architect, Landlord shall have the right to have
the repair work done by another reputable contractor to be chosen by Landlord and Contractor promptly shall reimburse Landlord
for the full cost thereof, plus interest at the rate of fifteen percent (15%) per annum upon billing. The provisions of this Letter
of Warranty shall survive the completion of the Work.


 


[NAME OF CONTRACTOR]


 


By:____________________

Name:_______________________________

Title:_______________________________



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