Unassociated Document


    Exhibit 10.10


    
      
CONTRIBUTION
AGREEMENT


    
       

      DATED
AS OF FEBRUARY 4, 2011


       

      BETWEEN


       

      ARC
REAL ESTATE PARTNERS, LLC


       

      AND


       

      ARC
PROPERTIES OPERATING PARTNERSHIP, L.P. 

      
        

      

      

        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

    

     

    TABLE
OF CONTENTS

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              	 
      	 
      	
                                                                      Page

                                                                    
	 
      	 
      	 
      
	
                                                                      ARTICLE
      1

                                                                    	
                                                                      CONTRIBUTION

                                                                    	
                                                                      2

                                                                    
	 
      	 
      	 
      
	
                                                                      Section
      1.01

                                                                    	
                                                                      CONTRIBUTION
      TRANSACTION

                                                                    	
                                                                      2

                                                                    
	
                                                                      Section
      1.02

                                                                    	
                                                                      CONSIDERATION

                                                                    	
                                                                      2

                                                                    
	
                                                                      Section
      1.03

                                                                    	
                                                                      ISSUANCE
      OF OP UNITS

                                                                    	
                                                                      2

                                                                    
	
                                                                      Section
      1.04

                                                                    	
                                                                      CONTRIBUTOR’S
      FORMATION TRANSACTION VALUE ADJUSTMENT

                                                                    	
                                                                      2

                                                                    
	
                                                                      Section
      1.05

                                                                    	
                                                                      FURTHER
      ACTION

                                                                    	
                                                                      4

                                                                    
	
                                                                      Section
      1.06

                                                                    	
                                                                      TRANSACTION
      COSTS

                                                                    	
                                                                      4

                                                                    
	
                                                                      Section
      1.07

                                                                    	
                                                                      TAX
      TREATMENT OF THE CONTRIBUTION

                                                                    	
                                                                      4

                                                                    
	 
      	 
      	 
      
	
                                                                      ARTICLE
      2

                                                                    	
                                                                      CLOSING

                                                                    	
                                                                      4

                                                                    
	 
      	 
      	 
      
	
                                                                      Section
      2.01

                                                                    	
                                                                      CONDITIONS
      PRECEDENT

                                                                    	
                                                                      4

                                                                    
	
                                                                      Section
      2.02

                                                                    	
                                                                      TIME
      AND PLACE

                                                                    	
                                                                      6

                                                                    
	
                                                                      Section
      2.03

                                                                    	
                                                                      DELIVERY
      OF OP UNITS; EXECUTION OF OPERATING PARTNERSHIP AGREEMENT

                                                                    	
                                                                      6

                                                                    
	
                                                                      Section
      2.04

                                                                    	
                                                                      CLOSING
      DELIVERIES

                                                                    	
                                                                      6

                                                                    
	
                                                                      Section
      2.05

                                                                    	
                                                                      CLOSING
      COSTS

                                                                    	
                                                                      7

                                                                    
	
                                                                      Section
      2.06

                                                                    	
                                                                      TERM
      OF THE AGREEMENT

                                                                    	
                                                                      7

                                                                    
	
                                                                      Section
      2.07

                                                                    	
                                                                      EFFECT
      OF TERMINATION

                                                                    	
                                                                      7

                                                                    
	
                                                                      Section
      2.08

                                                                    	
                                                                      TAX
      WITHHOLDING

                                                                    	
                                                                      7

                                                                    
	 
      	 
      	 
      
	
                                                                      ARTICLE
      3

                                                                    	
                                                                      REPRESENTATIONS,
      WARRANTIES AND INDEMNITIES OF THE OPERATING PARTNERSHIP

                                                                    	
                                                                      8

                                                                    
	 
      	 
      	 
      
	
                                                                      Section
      3.01

                                                                    	
                                                                      ORGANIZATION;
      AUTHORITY

                                                                    	
                                                                      8

                                                                    
	
                                                                      Section
      3.02

                                                                    	
                                                                      DUE
      AUTHORIZATION

                                                                    	
                                                                      8

                                                                    
	
                                                                      Section
      3.03

                                                                    	
                                                                      CONSENTS
      AND APPROVALS

                                                                    	
                                                                      8

                                                                    
	
                                                                      Section
      3.04

                                                                    	
                                                                      NO
      VIOLATION

                                                                    	
                                                                      8

                                                                    
	
                                                                      Section
      3.05

                                                                    	
                                                                      VALIDITY
      OF OP UNITS

                                                                    	
                                                                      8

                                                                    
	
                                                                      Section
      3.06

                                                                    	
                                                                      LITIGATION

                                                                    	
                                                                      9

                                                                    
	
                                                                      Section
      3.07

                                                                    	
                                                                      LIMITED
      ACTIVITIES

                                                                    	
                                                                      9

                                                                    
	
                                                                      Section
      3.08

                                                                    	
                                                                      NO
      OTHER REPRESENTATIONS OR WARRANTIES

                                                                    	
                                                                      9

                                                                    
	
                                                                      Section
      3.09

                                                                    	
                                                                      INDEMNIFICATION

                                                                    	
                                                                      9

                                                                    
	 
      	 
      	 
      
	
                                                                      ARTICLE
      4

                                                                    	
                                                                      REPRESENTATIONS
      AND WARRANTIES OF THE CONTRIBUTOR

                                                                    	
                                                                      11

                                                                    
	 
      	 
      	 
      
	
                                                                      Section
      4.01

                                                                    	
                                                                      ORGANIZATION;
      AUTHORITY

                                                                    	
                                                                      11

                                                                    
	
                                                                      Section
      4.02

                                                                    	
                                                                      DUE
      AUTHORIZATION

                                                                    	
                                                                      11

                                                                    
	
                                                                      Section
      4.03

                                                                    	
                                                                      OWNERSHIP
      OF CONTRIBUTED INTERESTS

                                                                    	
                                                                      11

                                                                    
	
                                                                      Section
      4.04

                                                                    	
                                                                      CONSENTS
      AND APPROVALS

                                                                    	
                                                                      11

                                                                    
	
                                                                      Section
      4.05

                                                                    	
                                                                      NO
      VIOLATION

                                                                    	
                                                                      12

                                                                    
	
                                                                      Section
      4.06

                                                                    	
                                                                      NON-FOREIGN
      PERSON

                                                                    	
                                                                      12

                                                                    


                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        	
                                                                Section
      4.07

                                                              	
                                                                TAXES

                                                              	
                                                                12

                                                              
	
                                                                Section
      4.08

                                                              	
                                                                TAX
      MATTERS

                                                              	
                                                                13

                                                              
	
                                                                Section
      4.09

                                                              	
                                                                TAX
      INFORMATION

                                                              	
                                                                13

                                                              
	
                                                                Section
      4.10

                                                              	
                                                                SOLVENCY

                                                              	
                                                                13

                                                              
	
                                                                Section
      4.11

                                                              	
                                                                LITIGATION

                                                              	
                                                                13

                                                              
	
                                                                Section
      4.12

                                                              	
                                                                INVESTMENT

                                                              	
                                                                13

                                                              
	
                                                                Section
      4.13

                                                              	
                                                                NO
      BROKERS OR FINDERS

                                                              	
                                                                14

                                                              
	
                                                                Section
      4.14

                                                              	
                                                                WAIVER
      OF RIGHTS UNDER ORGANIZATIONAL AGREEMENT

                                                              	
                                                                15

                                                              
	
                                                                Section
      4.15

                                                              	
                                                                NO
      OTHER REPRESENTATIONS OR WARRANTIES

                                                              	
                                                                15

                                                              
	
                                                                Section
      4.16

                                                              	
                                                                SURVIVAL
      OF REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTOR

                                                              	
                                                                15

                                                              
	 
      	 
      	 
      
	
                                                                ARTICLE
      5

                                                              	
                                                                COVENANTS
      AND OTHER AGREEMENTS

                                                              	
                                                                15

                                                              
	 
      	 
      	 
      
	
                                                                Section
      5.01

                                                              	
                                                                COVENANTS
      OF THE CONTRIBUTOR

                                                              	
                                                                15

                                                              
	
                                                                Section
      5.02

                                                              	
                                                                COMMERCIALLY
      REASONABLE EFFORTS BY THE OPERATING PARTNERSHIP AND THE
      CONTRIBUTOR

                                                              	
                                                                16

                                                              
	 
      	 
      	 
      
	
                                                                ARTICLE
      6

                                                              	
                                                                CHANGES
      TO FORM AGREEMENTS

                                                              	
                                                                16

                                                              
	 
      	 
      	 
      
	
                                                                Section
      6.01

                                                              	
                                                                CHANGES
      TO FORM AGREEMENTS

                                                              	
                                                                16

                                                              
	 
      	 
      	 
      
	
                                                                ARTICLE
      7

                                                              	
                                                                POWER
      OF ATTORNEY

                                                              	
                                                                16

                                                              
	 
      	 
      	 
      
	
                                                                Section
      7.01

                                                              	
                                                                POWER
      OF ATTORNEY

                                                              	
                                                                16

                                                              
	 
      	 
      	 
      
	
                                                                ARTICLE
      8

                                                              	
                                                                GENERAL
      PROVISIONS

                                                              	
                                                                17

                                                              
	 
      	 
      	 
      
	
                                                                Section
      8.01

                                                              	
                                                                NOTICES

                                                              	
                                                                17

                                                              
	
                                                                Section
      8.02

                                                              	
                                                                DEFINITIONS

                                                              	
                                                                17

                                                              
	
                                                                Section
      8.03

                                                              	
                                                                COUNTERPARTS

                                                              	
                                                                23

                                                              
	
                                                                Section
      8.04

                                                              	
                                                                ENTIRE
      AGREEMENT; THIRD-PARTY BENEFICIARIES

                                                              	
                                                                23

                                                              
	
                                                                Section
      8.05

                                                              	
                                                                GOVERNING
      LAW

                                                              	
                                                                23

                                                              
	
                                                                Section
      8.06

                                                              	
                                                                ASSIGNMENT

                                                              	
                                                                23

                                                              
	
                                                                Section
      8.07

                                                              	
                                                                JURISDICTION

                                                              	
                                                                24

                                                              
	
                                                                Section
      8.08

                                                              	
                                                                SEVERABILITY

                                                              	
                                                                24

                                                              
	
                                                                Section
      8.09

                                                              	
                                                                RULES
      OF CONSTRUCTION

                                                              	
                                                                24

                                                              
	
                                                                Section
      8.10

                                                              	
                                                                EQUITABLE
      REMEDIES

                                                              	
                                                                24

                                                              
	
                                                                Section
      8.11

                                                              	
                                                                TIME
      OF THE ESSENCE

                                                              	
                                                                25

                                                              
	
                                                                Section
      8.12

                                                              	
                                                                DESCRIPTIVE
      HEADINGS

                                                              	
                                                                25

                                                              
	
                                                                Section
      8.13

                                                              	
                                                                NO
      PERSONAL LIABILITY CONFERRED

                                                              	
                                                                25

                                                              
	
                                                                Section
      8.14

                                                              	
                                                                AMENDMENTS

                                                              	
                                                                25

                                                              


                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    EXHIBITS

     

    A – List
of Properties

    B –
FIRPTA Affidavit

    C –
Accredited Investor Questionnaire


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    D – Form
of Assignment and Assumption of Ownership Interests

    E –
Permitted Exceptions

    F –
Permitted Mortgage Indebtedness


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    CONTRIBUTION
AGREEMENT

     

    THIS
CONTRIBUTION AGREEMENT (this “Agreement”) is made and
entered into between ARC Properties Operating Partnership, L.P., a Delaware
limited partnership and subsidiary of the REIT (defined below) (the “Operating Partnership”), and
ARC Real Estate Partners, LLC, a Delaware limited liability company (the “Contributor”), and shall be
effective as of the date accepted by the Operating Partnership, as set forth on
the signature page hereto (the “Effective Date”). Capitalized
terms used herein shall have the meanings set forth in Section 8.02
hereof.

     

    RECITALS

     

    WHEREAS,
in connection with an initial public offering (“IPO”) of its common stock, par
value $.01 per share (“REIT
Common Stock”), American Realty Capital Properties, Inc., a Maryland
corporation (the “REIT”), desires to (i)
consolidate the ownership of a portfolio of properties set forth on Exhibit
A hereto (the “Properties”) currently owned,
directly or indirectly, by ARC Income Properties, LLC, a Delaware limited
liability company and American Realty Capital Partners, LLC, a Delaware limited
liability company (collectively, the “Contributed Entities”); and
(ii) own and operate such Properties within the meaning of Section 856 of the
Code; and

     

    WHEREAS,
the Contributor owns all of the issued and outstanding ownership interests (the
“Contributed Interests”)
in the Contributed Entities; and

     

    WHEREAS,
the consolidation of the ownership of the Properties will be accomplished by a
contribution (the “Contribution”) by the
Contributor of the Contributed Interests to the Operating Partnership in
exchange for units of limited partner interest in the Operating Partnership
(“OP Units”) pursuant to
this Agreement; and

     

    WHEREAS,
upon the closing of its IPO, the REIT shall contribute the net proceeds of such
IPO to the Operating Partnership in exchange for that number of OP Units
necessary to provide to the REIT an aggregate total value in OP Units equal to
the net proceeds contributed, with a value per OP Unit equal to the initial
public offering price of a share of REIT Common Stock (the “IPO Price”); and

     

    WHEREAS,
as part of the Contribution and subject to (a) the terms and conditions set
forth herein; and (b) the completion of the IPO, the Contributor desires to
contribute to the Operating Partnership, and the Operating Partnership desires
to acquire from the Contributor, all of the Contributor’s right, title and
interests in the Contributed Interests, in exchange for OP Units;
and

     

    WHEREAS,
all necessary approvals have been obtained by the parties to this Agreement to
consummate the transactions contemplated herein.

     

    NOW,
THEREFORE, in consideration of the foregoing and the representations,
warranties, covenants and other terms contained in this Agreement, the parties
hereto, intending to be legally bound hereby, agree as follows:


    
      
         


      

      
        1

        
          

        

      

      
         


      

    


    ARTICLE
1

     

    CONTRIBUTION

     

    Section
1.01        CONTRIBUTION
TRANSACTION. At the
Closing and subject to the terms and conditions contained in this Agreement, the
Contributor hereby agrees to assign, set over, and transfer to the Operating
Partnership, absolutely and unconditionally and free and clear of all Liens, all of its right,
title and interest in and to the Contributed Interests, in exchange for the
consideration set forth in Section 1.02, and the
Operating Partnership hereby agrees to accept such assignment by the Contributor
and to agree to be bound by the terms of the Organizational Agreement and to
undertake, assume and agree to punctually and faithfully perform, pay or
discharge when due and otherwise in accordance with its terms all agreements,
covenants, conditions, obligations and liabilities of the Contributor in the
Contributed Entities with respect to the Contributed Interest on or after the
Closing Date.

     

    Section
1.02        CONSIDERATION. At the
Closing and subject to the terms and conditions contained in this Agreement, the
Contributor hereby irrevocably agrees to accept, in exchange for the Contributed
Interests, a number of OP Units equal to $3,875,000, as the same may be adjusted
in accordance with Section 1.04 below
(the “Contributor’s Formation
Transaction Value”), divided by the IPO
Price.

     

    Section
1.03        ISSUANCE OF OP
UNITS. At the
Closing and subject to the terms and conditions contained in this Agreement, the
Operating Partnership shall, in exchange for the Contributed Interests
contributed by the Contributor, issue to the Contributor a number of OP Units
equal to the Contributor’s Formation Transaction Value, divided by the IPO
Price. No fractional OP Units shall be issued pursuant to this Agreement. If the
preceding formula would require the issuance of a fractional OP Unit, the number
of OP Units which the Contributor shall be entitled to receive shall be rounded
to the nearest whole number.

     

    Section 1.04        CONTRIBUTOR’S FORMATION
TRANSACTION VALUE ADJUSTMENT. The
Contributor’s Formation Transaction Value shall be adjusted on the Closing Date
as follows:

     

    (a)         the
Contributor’s Formation Transaction Value shall be increased by an amount equal
to:

     

    (i)           all
Amortizing Principal Payments made by a Property Owner on or after February 1,
2011 and prior to the Cut-Off Date in respect of Debt of a Property
Owner;

     

    (ii)          all
Extraordinary Principal Payments made by a Property Owner after the Effective
Date and prior to the Cut-Off Date in respect of Debt of a Property
Owner;

     

    (iii)        all
additions to Non-Operating Expense Reserves of a Property Owner made on or after
February 1, 2011 and prior to the Cut-Off Date; and

     

    (iv)        all
Extraordinary Expense Prepayments made by a Property Owner after the Effective
Date and outstanding as of the Cut-Off Date, other than that portion of each
such Extraordinary Expense Prepayment relating to the period ending thirty (30)
calendar days after the Cut-Off Date;


    
      
         


      

      
        2

        
          

        

      

      
         


      

    


    in each
case to the extent such amounts were paid in cash from operating income of a
Property Owner and in any event not from loan proceeds, casualty insurance
proceeds or proceeds from condemnation or eminent domain proceedings, or
proceeds from the sale or other disposition of a Property or any interest
therein, or that are otherwise derived from a source other than the operation,
leasing, management or occupancy of a Property;

     

    (b)         the
Contributor’s Formation Transaction Value shall be decreased by an amount equal
to:

     

    (i)           all
Extraordinary Rent Prepayments received by a Property Owner after the Effective
Date, other than that portion of each such Extraordinary Rent Prepayment
relating to the period ending thirty (30) calendar days after the Cut-Off
Date;

     

    (ii)          all
Past Due Payables of a Property Owner outstanding as of the Cut-Off
Date;

     

    (iii)         all
withdrawals from Non-Operating Expense Reserves of a Property Owner made on or
after the Effective Date and prior to the Cut-Off Date;

     

    (iv)         all
distributions made by a Property Owner of funds consisting of loan proceeds,
casualty insurance proceeds, proceeds from condemnation or eminent domain
proceedings, or proceeds from the sale or other disposition of a Property or any
interest therein, or that are otherwise derived from a source other than the
operation, leasing, management or occupancy of a Property; and

     

    (v)          all
liens, judgments and other monetary encumbrances against a Property other than
Permitted Exceptions.

     

    (c)         the
Contributor’s Formation Transaction Value shall be increased or decreased by the
amount, if any, by which the Cut-Off Date Cash Balance is greater than (in which
case such value shall be increased) or less than (in which case such value shall
be decreased) the Target Cash Balance.

     

    Within
ten (10) calendar days of the SEC Effective Date, the Operating Partnership and
the Contributor will in good faith make a calculation of the Contributor’s
Formation Transaction Value as of the SEC Effective Date. The number of the OP
Units to be received by the Contributor in accordance with Section 1.02 shall be
increased or decreased based on this calculation. After the SEC Effective Date
no further adjustments in the number of OP Units to be received by the
Contributor shall be made. If the Contributor’s Formation Transaction Value as
determined in the Final Adjustment is greater than the product of (x) the number
of OP Units received by the Contributor at the Closing and (y) the IPO Price,
the Operating Partnership shall, within five (5) calendar days of the Closing,
pay such difference to the Contributor in cash. If the Contributor’s Formation
Transaction Value as determined in the Final Adjustment is less than the product
of (x) the number of OP Units received by the Contributor at the Closing and (y)
the IPO, the Contributor shall, within five (5) calendar days of the Closing,
pay such difference to the Operating Partnership in cash. A further final
adjustment to the Contributor’s Formation Transaction Value shall be determined
as of the Cut-Off Date (the “Final Adjustment”), and no
further adjustment shall be made thereafter. The Contributor agrees to provide,
and to use the Contributor’s reasonable efforts to cause the Contributed
Entities and the Property Owners to provide, such information as the Operating
Partnership may reasonably require to make the adjustments to the Contributor’s
Formation Transaction Value as provided in this Section 1.04. The
parties acknowledge and agree that in determining the Contributor’s Formation
Transaction Value the parties assumed, among other things, that the
Contributor’s Formation Transaction Value would not be subject to any pro ration
or adjustment other than as specifically provided in this Section
1.04.


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


    Section
1.05        FURTHER
ACTION. If, at
any time after the Closing, the Operating Partnership shall determine or be
advised that any deeds, bills of sale, assignments, assurances or other actions
or things are necessary or desirable to vest, perfect or confirm of record or
otherwise in the Operating Partnership the right, title or interest in or to the
Contributed Interests and the admission and substitution of the Operating
Partnership for the Contributor as a member of the Contributed Entities, the
Contributor shall execute and deliver all such deeds, bills of sale, assignments
and assurances and take and do all such other actions and things as may be
necessary or desirable to vest, perfect or confirm any and all right, title and
interest in the Contributed Interests or otherwise to carry out this
Agreement.

     

    Section
1.06        TRANSACTION
COSTS. If the
Closing occurs, the REIT and the Operating Partnership shall be solely
responsible for all transaction costs and expenses of the REIT, the Operating
Partnership and the Contributed Entities in connection with the Contribution and
the IPO, which include, but are not limited to, the selling commissions and
dealer manager fees; provided that the REIT and
the Operating Partnership shall not be responsible for any transaction costs or
expenses incurred by the Contributor.

     

    Section
1.07        TAX TREATMENT OF THE
CONTRIBUTION. The
parties hereto intend and agree to treat, for U.S. federal income tax purposes,
the contribution of the Contributed Interests in exchange for OP Units
effectuated pursuant to this Agreement as a contribution to a partnership
pursuant to Section 721 of the Code, except with respect to OP Units received in
connection with amounts under Section 1.04, and no party shall maintain any
position to the contrary on any Tax Return or otherwise.

     

    ARTICLE
2

     

    CLOSING

     

    Section
2.01        CONDITIONS
PRECEDENT.

     

    (a)         Condition to Each Party’s
Obligations. The respective obligations of each party to effect the
contribution of the Contributed Interests and the issuance of the OP Units
contemplated by this Agreement, and to consummate the other transactions
contemplated hereby, is subject to the satisfaction or, if applicable, waiver,
on or prior to the Closing Date, of the following conditions:


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


    (i)           Registration Statement. The
Registration Statement shall have become effective under the Securities Act of
1933, as amended (the “Securities Act”), and shall not be the
subject of any stop order or proceeding by the Securities and Exchange
Commission (the “SEC”) seeking a stop order.
This condition may not be waived by any party.

     

    (ii)          IPO Proceeds. The REIT shall
have received the proceeds from the IPO not later than concurrently herewith.
This condition may not be waived by any party.

     

    (iii)         No Injunction. No party to
this Agreement shall be subject to any statute, rule, regulation, executive
order, decree, judgment, injunction or other order (whether temporary,
preliminary or permanent) of any Governmental Authority that prevents or
prohibits consummation of any of the transactions contemplated in this
Agreement.

     

    (b)         Conditions to Obligations of the
Operating Partnership. The obligations of the Operating Partnership are
further subject to satisfaction of the following conditions (any of which may be
waived by the Operating Partnership in whole or in part):

     

    (i)           Representations and Warranties.
Except as would not have a material adverse effect on the financial
condition or results of operations of the Contributed Entities or the Operating
Partnership, the representations and warranties of the Contributor contained in
this Agreement shall be true and correct at the Closing as if made again at that
time (except to the extent that any representation or warranty speaks as of an
earlier date, in which case it must be true and correct only as of that earlier
date).

     

    (ii)          Performance by the Contributor.
The Contributor shall have performed in all material respects all
agreements and covenants required by this Agreement to be performed or complied
with by it on or prior to the Closing Date.

     

    (iii)         Consents, Etc. All necessary consents
and approvals of Governmental Authorities or third parties (including lenders)
for the Contributor and each Property Owner to consummate the transactions
contemplated hereby (except for those the absence of which would not have a
material adverse effect on the ability of the Contributor or any Property Owner
to consummate the transactions contemplated by this Agreement) shall have been
obtained.

     

    (iv)        No Material Adverse Change.
There shall have not occurred between the date hereof and the Closing
Date any material adverse change in any of the assets, business, financial
condition, results of operation or prospects of the Contributed Entities or the
Operating Entity.

     

    (c)         Conditions to Obligations of the
Contributor. The obligation of the Contributor to effect the contribution
contemplated by this Agreement and to consummate the other transactions
contemplated hereby to occur on the Closing Date are further subject to
satisfaction of the following conditions:

     

    (i)           Representations and Warranties.
Except as would not have a material adverse effect on the financial
condition or results of operations of the Operating Partnership, the
representations and warranties of the Operating Partnership contained in this
Agreement shall be true and correct at the Closing as if made again at that time
(except to the extent that any representation or warranty speaks as of an
earlier date, in which case it must be true and correct only as of that earlier
date).


    
      
         


      

      
        5

        
          

        

      

      
         


      

    


    (ii)          Performance by the Operating
Partnership. The Operating Partnership shall have performed in all
material respects all agreements and covenants required by this Agreement to be
performed or complied with by it on or prior to the Closing Date.

     

    (iii)         Registration Rights Agreement.
The REIT shall have executed and delivered a registration rights
agreement substantially in a form reasonably acceptable to the parties
hereto.

     

    (iv)        Guarantees. Nicholas S.
Schorsch and William M. Kahane will be released from, or indemnified by the
Operating Partnership against, any guarantees granted by them to the lenders
holding the Permitted Mortgage Indebtedness.

     

    Section
2.02         TIME AND
PLACE. Unless
this Agreement shall have been terminated pursuant to Section 2.06 hereof,
and subject to satisfaction or waiver of the conditions in Section 2.01 hereof,
the closing of the Contribution (the “Closing”) and the other
transactions contemplated hereby shall occur on the day on which the REIT
receives the proceeds from the IPO from the dealer managers (the “Closing Date”). The Closing shall take
place at the offices of Proskauer Rose LLP, Eleven Times Square, New York, NY
10036, or such other place as determined by the Operating Partnership in its
sole discretion. The Contribution and all closing deliveries shall be deemed
concurrent for all purposes.

     

    Section
2.03       DELIVERY OF OP UNITS;
EXECUTION OF OPERATING PARTNERSHIP AGREEMENT.  The
issuance of the OP Units pursuant to this Agreement shall be reflected in the
Amended and Restated Agreement of Limited Partnership of the Operating
Partnership (as amended, supplemented or otherwise modified from time to time,
the “Operating Partnership
Agreement”) in form and substance
reasonably acceptable to the Operating Partnership and the Contributor. The OP
Units will be governed by the terms and conditions of the Operating Partnership
Agreement, a copy of which the Contributor will accept and agree to execute and
by which the Contributor will agree to be legally bound. At the Closing (or as
soon as reasonably practicable thereafter), the Operating Partnership shall
deliver or cause to be delivered to the Contributor an executed copy of the
Operating Partnership Agreement.

     

    Section
2.04        CLOSING
DELIVERIES. At the
Closing, the parties shall make, execute, acknowledge and deliver, or cause to
be made, executed, acknowledged and delivered any other documents reasonably
requested by the Operating Partnership or reasonably necessary or desirable to
assign, transfer, convey, contribute and deliver the Contributed Interests, free
and clear of all Liens, to admit and substitute the Operating Partnership for
the Contributor as a member of the Contributed Entities and to effectuate the
transactions contemplated hereby, including, without limitation:

     

    (a)         The
Operating Partnership Agreement;

     

    (b)         The
Registration Rights Agreement;


    
      
         


      

      
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    (c)         To
the extent Nicholas S. Schorsch and William H. Kahane are not released from any
guarantees they have provided to the lenders holding the Permitted Mortgage
Indebtedness, the Operating Partnership shall deliver the Indemnification
Agreement;

     

    (d)         An
Assignment and Assumption;

     

    (e)         A
FIRPTA Affidavit in the form attached hereto as Exhibit
B;

     

    (f)          An
IRS Form W-9; and

     

    (g)         A
tax protection agreement between the Contributor and the Operating Partnership,
the terms of which shall be reasonably agreed to prior to the
Closing.

     

    Section
2.05       CLOSING
COSTS. The
Operating Partnership shall pay any documentary transfer Taxes, escrow charges,
title charges and recording Taxes or fees incurred in connection with the
transactions contemplated hereby.

     

    Section
2.06        TERM OF THE
AGREEMENT. This
Agreement shall terminate automatically if (i) the initial registration
statement of the REIT for the IPO (the “Registration Statement”) has not been filed with
the SEC by April 30, 2011, or (ii) the Contribution shall not have been
consummated on or prior to November 30, 2011 (such date is hereinafter referred
to as the “Outside
Date”).

     

    Section
2.07        EFFECT OF
TERMINATION. In the
event of termination of this Agreement for any reason, all obligations on the
part of the Operating Partnership and the Contributor under this Agreement shall
terminate, except that the obligations set forth in Article 8 shall
survive; it being understood and agreed, however, for the avoidance of doubt,
that if this Agreement is terminated because one or more of the conditions to a
non-breaching party’s obligations under this Agreement is not satisfied by the
Outside Date as a result of another party’s material breach of a covenant,
representation, warranty or other obligation under this Agreement, the
non-breaching party’s right to pursue all legal remedies with respect to such
breach will survive such termination unimpaired. If this Agreement shall
terminate for any reason prior to completion of the Contribution, the
Contributor shall pay its own costs and expenses and the transaction costs and
expenses of the REIT, the Operating Partnership and the Contributed Entities
relating to the Contribution, as determined by the Operating Partnership in its
reasonable discretion.

     

    Section
2.08        TAX
WITHHOLDING. The
Operating Partnership shall be entitled to deduct and withhold, from the
consideration payable pursuant to this Agreement, if any, to the Contributor
such amounts as the Operating Partnership is required to deduct and withhold
with respect to the making of such payment under the Code or any provision of
state, local or foreign tax law (e.g., backup withholding or
FIRPTA withholding). To the extent that amounts are so withheld by the Operating
Partnership, such withheld amounts shall be treated for all purposes of this
Agreement as having been paid to the Contributor in respect of which such
deduction and withholding was made by the Operating
Partnership.


    
      
         


      

      
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    ARTICLE
3


     

    REPRESENTATIONS,
WARRANTIES AND

    INDEMNITIES
OF THE OPERATING PARTNERSHIP

     

    The
Operating Partnership hereby represents and warrants to and covenants with the
Contributor as follows:

     

    Section
3.01        ORGANIZATION;
AUTHORITY. The
Operating Partnership is a limited partnership duly organized, validly existing
and in good standing under the Laws of the State of Delaware. The Operating
Partnership has all requisite power and authority to enter this Agreement and to
carry out the transactions contemplated hereby, and to own, lease or operate its
property and to carry on its business as presently conducted and, to the extent
required under applicable Law, is qualified to do business and is in good
standing in each jurisdiction in which the nature of its business or the
character of its property make such qualification necessary, other than in such
jurisdictions where the failure to be so qualified would not have a material
adverse effect on the financial condition or results of operations of the
Operating Partnership.

     

    Section
3.02        DUE
AUTHORIZATION. The
execution, delivery and performance of this Agreement by the Operating
Partnership have been duly and validly authorized by all necessary action of the
Operating Partnership. This Agreement and each agreement, document and
instrument executed and delivered by or on behalf of the Operating Partnership
pursuant to this Agreement constitute, or when executed and delivered will
constitute, the legal, valid and binding obligation of the Operating
Partnership, each enforceable against the Operating Partnership in accordance
with its terms, subject to applicable bankruptcy, insolvency, moratorium or
other similar Laws relating to creditors’ rights and general principles of
equity and except to the extent that enforceability of the indemnification and
contribution provisions set forth in this Agreement may be limited by the
federal or state securities Laws or the public policy underlying such
Laws.

     

    Section
3.03        CONSENTS AND
APPROVALS. Except in
connection with the IPO and the consummation of the Contribution, no consent,
waiver, approval or authorization of, or filing with, any Person or Governmental
Authority or under any applicable Laws is required to be obtained by the
Operating Partnership in connection with the execution, delivery and performance
of this Agreement and the transactions contemplated hereby.

     

    Section
3.04        NO
VIOLATION. None of
the execution, delivery or performance of this Agreement, any agreement
contemplated hereby between the parties to this Agreement and the transactions
contemplated hereby between the parties to this Agreement does or will, with or
without the giving of notice, lapse of time, or both, violate, conflict with,
result in a breach of, or constitute a default under (a) the organizational
documents of the Operating Partnership, (b) any term or provision of any
judgment, order, writ, injunction, or decree binding on the Operating
Partnership, or (c) any other material agreement to which the Operating
Partnership is a party.

     

    Section
3.05        VALIDITY OF OP
UNITS. The
issuance of the OP Units to the Contributor pursuant to this Agreement will have
been duly authorized by the Operating Partnership and, when issued against the
consideration therefor, will be validly issued by the Operating Partnership,
free and clear of all Liens (other than Liens created by the Operating
Partnership Agreement).


    
      
         


      

      
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    Section
3.06        LITIGATION. There is
no action, suit or proceeding pending or, to the Operating Partnership’s
knowledge, threatened against the Operating Partnership that, if adversely
determined, would have a material adverse effect on the financial condition or
results of operations of the Operating Partnership or which challenges or
impairs the ability of the Operating Partnership to execute or deliver, or
perform its obligations under, this Agreement and the documents executed by it
pursuant to this Agreement or to consummate the transactions contemplated hereby
or thereby.

     

    Section
3.07        LIMITED
ACTIVITIES. Except
for activities in connection with the IPO or the Contribution, the Operating
Partnership has not engaged in any material business or incurred any material
obligations.

     

    Section
3.08        NO OTHER REPRESENTATIONS OR
WARRANTIES. Other
than the representations and warranties expressly set forth in this Article III, the
Operating Partnership shall not be deemed to have made any other representation
or warranty in connection with this Agreement or the transactions contemplated
hereby.

     

    Section
3.09        INDEMNIFICATION.

     

    (a)         From
and after the Closing Date, the Operating Partnership shall indemnify and hold
harmless the Contributor and its Affiliates (each, a “Contributor Indemnified
Party”) from
and against any and all charges, complaints, claims, actions, causes of action,
losses, damages, liabilities and expenses of any nature whatsoever, including
without limitation, amounts paid in settlement, reasonable attorneys’ fees,
costs of investigation, costs of investigative judicial or administrative
proceedings or appeals therefrom and costs of attachment or similar bonds
(collectively, “Losses”)
arising out of or relating to, asserted against, imposed upon or incurred by any
Contributor Indemnified Party in connection with or as a result of any breach of
a representation, warranty or covenant of the Operating Partnership contained in
this Agreement or in any schedule, exhibit, certificate or affidavit or any
other document delivered by the Operating Partnership pursuant to this
Agreement; provided, however, that the Operating
Partnership shall not have any obligation under this Section 3.09 to
indemnify any Contributor Indemnified Party against any Losses to the extent
that such Losses arise from (i) any diminution in value of OP Units; or (ii) the Contributor’s
breach of this Agreement, gross negligence, willful misconduct or
fraud.

     

    (b)         At
the time when any Contributor Indemnified Party learns of any potential claim
under this Section
3.09 (a “Claim”) against the Operating
Partnership, it will promptly give written notice (a “Claim Notice”) to the Operating
Partnership; provided
that failure to do so shall
not prevent recovery under this Agreement, except to the extent that the
Operating Partnership shall have been materially prejudiced by such failure.
Each Claim Notice shall describe in reasonable detail the facts known to such
Contributor Indemnified Party giving rise to such Claim, and the amount or good
faith estimate of the amount of Losses arising therefrom. Unless prohibited by
Law, such Contributor Indemnified Party shall deliver to the Operating
Partnership, promptly after such Contributor Indemnified Party’s receipt
thereof, copies of all notices and documents (including court papers) received
by such Contributor Indemnified Party relating to a Third Party Claim. Any
Contributor Indemnified Party may, at its option, demand indemnity under this
Section 3.09 as
soon as a Claim has been threatened by a third party, regardless of whether an
actual Loss has been suffered, so long as such Contributor Indemnified Party
shall in good faith determine that such Claim is not frivolous and that such
Contributor Indemnified Party may be liable for, or otherwise incur, a Loss as a
result thereof.


    
      
         


      

      
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    (c)         The
Operating Partnership shall be entitled, at its own expense, to assume and
control the defense of any Claims asserted by third parties (“Third Party Claims”), through counsel chosen
by the Operating Partnership, if it gives notice of its intention to do so to
such Contributor Indemnified Party within thirty (30) calendar days of the
receipt of the applicable Claim Notice; provided, however, that such Contributor
Indemnified Party may at all times participate in such defense at its own
expense. Without limiting the foregoing, in the event that the Operating
Partnership exercises the right to undertake any such defense against a Third
Party Claim, such Contributor Indemnified Party shall cooperate with the
Operating Partnership in such defense and make available to the Operating
Partnership (unless prohibited by Law), at the Operating Partnership’s expense,
all witnesses, pertinent records, materials and information in such Contributor
Indemnified Party’s possession or under such Contributor Indemnified Party’s
control relating thereto as is reasonably required by the Operating Partnership.
No compromise or settlement of such Third Party Claim may be effected by either
such Contributor Indemnified Party, on the one hand, or the Operating
Partnership, on the other hand, without the other’s consent (which shall not be
unreasonably withheld or delayed) unless (i) there is no finding or admission of
any violation of Law and no effect on any other claims that may be made against
such other party and (ii) each Contributor Indemnified Party that is party to
such Claim is released from all liability with respect to such
Claim.

     

    (d)         All
representations, warranties and covenants of the Operating Partnership contained
in this Agreement shall survive until the first anniversary of the Closing Date
(the “Expiration
Date”). If a
Claim Notice has been given in accordance with the provisions of this Section 3.09 prior to
the Expiration Date, then the relevant representation, warranty and covenant
shall survive, but only with respect to such specific Claim, until such Claim
has been finally resolved. Any claim for indemnification not so asserted in
writing by the Expiration Date may not thereafter be asserted and shall forever
be waived. In furtherance of the foregoing, the Contributor hereby waives, as of
the Closing, to the fullest extent permitted under applicable Law, any and all
rights, claims and causes of action (other than claims of, or causes of action
arising from, fraud) it may have against the Operating Partnership arising under
or based upon any federal, state, local or foreign Law, other than the right to
seek indemnity pursuant to this Section 3.09. The
foregoing sentence shall not limit the Contributor’s right to specific
performance or injunctive relief in connection with the breach by the Operating
Partnership of its covenants in this Agreement.

     

    (e)         All
indemnity payments made hereunder shall be treated as adjustments to the
consideration paid hereunder for United States federal income tax
purposes.


    
      
         


      

      
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    ARTICLE
4


     

    REPRESENTATIONS
AND WARRANTIES OF THE CONTRIBUTOR

     

    The
Contributor hereby represents, warrants and agrees that as of the Closing
Date:

     

    Section
4.01        ORGANIZATION;
AUTHORITY. The
Contributor is a limited liability company duly organized, validly existing and
in good standing under the Laws of the State of Delaware. The Contributor has
all requisite power and authority to enter this Agreement and to carry out the
transactions contemplated hereby, and to own, lease or operate its property and
to carry on its business as presently conducted and, to the extent required
under applicable Law, is qualified to do business and is in good standing in
each jurisdiction in which the nature of its business or the character of its
property make such qualification necessary, other than in such jurisdictions
where the failure to be so qualified would not have a material adverse effect on
the financial condition or results of operations of the
Contributor.

     

    Section
4.02        DUE
AUTHORIZATION. The
execution, delivery and performance of this Agreement by the Contributor has
been duly and validly authorized by all necessary action of the Contributor.
This Agreement and each agreement, document and instrument executed and
delivered by or on behalf of the Contributor pursuant to this Agreement
constitute, or when executed and delivered will constitute, the legal, valid and
binding obligation of the Contributor, each enforceable against the Contributor
in accordance with its terms, subject to applicable bankruptcy, insolvency,
moratorium or other similar Laws relating to creditors’ rights and general
principles of equity and except to the extent that enforceability of the
indemnification and contribution provisions set forth in this Agreement may be
limited by the federal or state securities Laws or the public policy underlying
such Laws.

     

    Section
4.03        OWNERSHIP OF CONTRIBUTED
INTERESTS. The
Contributor is the record owner of the Contributed Interests owned by it and has
the power and authority to transfer, sell, assign and convey to the Operating
Partnership the Contributed Interests free and clear of any Liens and, upon
delivery of the consideration for the Contributed Interests as provided herein,
the Operating Partnership will acquire good and valid title thereto, free and
clear of any Liens. Except as provided for in this Agreement, there are no
rights, subscriptions, warrants, options, conversion rights, preemptive rights,
agreements, instruments or understandings of any kind outstanding (i) relating
to the Contributed Interests or (ii) to purchase, transfer or otherwise acquire,
or in any way encumber, any of the interests which comprise the Contributed
Interests or any securities or obligations of any kind convertible into any of
the interests which comprise the Contributed Interests or other equity interests
or profit participation of any kind in the Contributed Entities. All of the
issued and outstanding Contributed Interests have been duly authorized and are
validly issued, fully paid and non-assessable. By acquiring the Contributed
Interests, the Operating Partnership will acquire indirectly a 100% interest in
each of the Properties.

     

    Section
4.04        CONSENTS AND
APPROVALS. Except as
shall have been satisfied on or prior to the Closing Date, no consent, waiver,
approval or authorization of, or filing with, any Person or Governmental
Authority or under any applicable Laws is required to be obtained by the
Contributor in connection with the execution, delivery and performance of this
Agreement and the transactions contemplated hereby, except for those consents,
waivers, approvals, authorizations or filings, the failure of which to obtain or
to file would not have a material adverse effect on the financial condition or
results of operations of the Contributed Entities.


    
      
         


      

      
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    Section
4.05        NO
VIOLATION. None of
the execution, delivery or performance of this Agreement, any agreement
contemplated hereby between the parties to this Agreement and the transactions
contemplated hereby or thereby does or will, with or without the giving of
notice, lapse of time, or both, violate, conflict with, result in a breach of,
or constitute a default under or give to others any right of termination,
acceleration, cancellation or other right under (A) any agreement, document or
instrument to which the Contributor is a party or by which the Contributor or
its Contributed Interest is bound, (B) any term or provision of any judgment,
order, writ, injunction, or decree binding on the Contributor (or its assets or
properties), or (C) any provisions of the organizational or other formation or
governing documents or agreements of the Contributor, except any such breaches
or defaults that would not have a material adverse effect on the financial
condition or results of operations of the Contributed Entities.

     

    Section
4.06        NON-FOREIGN
PERSON. The
Contributor is a United States person (as defined in the Code) and is,
therefore, not subject to the provisions of the Code relating to the withholding
of sales or exchange proceeds to foreign persons.

     

    Section
4.07        TAXES.


     

    (a)         The
Contributor has timely filed, or caused to be timely filed, all material Tax
Returns and reports required to be filed by it and each Operating Entity (after
giving effect to any filing extension properly granted by a Governmental
Authority having authority to do so) and all such Tax Returns and reports are
accurate and complete in all material respects, and has timely paid in full, or
caused to be timely paid in full, all Taxes as required to be paid by it and
each Operating Entity whether or not shown to be due and payable on such Tax
Returns. No written deficiencies for any Taxes have been proposed, asserted or
assessed against the Contributor or any Operating Entity, and to the
Contributor’s knowledge, no deficiencies for any Taxes will be proposed,
asserted or assessed against it or any Operating Entity. No waivers of the
statutes of limitation are in effect in respect of any Taxes and none of the
Operating Entities has agreed to any extension of time with respect to a Tax
assessment or deficiency.

     

    (b)         No
claim has ever been made by an authority in a jurisdiction where an Operating
Entity does not file Tax Returns that such Operating Entity is or may be subject
to taxation by that jurisdiction.

     

    (c)         There
are no Liens for Taxes (other than Taxes not yet due and payable) upon any of
the assets of the Operating Entities.

     

    (d)         The
Operating Entities have complied in all material respects with all applicable
Laws and agreements relating to the payment and withholding of Taxes and have,
within the time and in the manner prescribed by applicable Laws and agreements,
withheld and paid over to the proper Governmental Authority all amounts required
to have been withhold and paid in connection with amounts paid or owing to any
past or present employee, independent contractor, creditor, member, consultant
or other third party.


    
      
         


      

      
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    (e)         Each
Operating Entity has been at all times treated as other than an association
taxable as a corporation for U.S. federal income tax purposes.

     

    (f)          No
closing agreement is currently in force pursuant to Section 7121 of the Code (or
any similar provision of state, local or foreign Law) with respect to any of the
Operating Entities and there are no Tax rulings or requests for Tax rulings or
closing agreements that could affect to liability for Taxes of any of the
Operating Entities after the Closing Date.

     

    (g)         No
Operating Entity is a party to any Tax Sharing Agreement.

     

    (h)         No
Operating Entity is or has been a party to any “reportable transaction,” as
defined in Section 6707A(c)(1) of the Code and Treasury Regulations Section
1.6011-4(b).

     

    Section
4.08        TAX
MATTERS. Contributor
represents and warrants that it has obtained from its own counsel advice
regarding the tax consequences of (i) the transfer of the Contributed Interests
to the Operating Partnership and the receipt of OP Units as consideration
therefor, (ii) Contributor’s admission as a limited partner of the Operating
Partnership and (iii) any other transaction contemplated by this Agreement.
Contributor further represents and warrants that it has not relied on the
Operating Partnership, the REIT, or any of their Affiliates, representatives or
counsel for any tax advice.

     

    Section
4.09        TAX
INFORMATION. From the
date hereof and subsequent to the Closing, Contributor agrees to provide the
Operating Partnership with such tax information relating to the Contributed
Interests and the Operating Entities that is in the Contributor’s possession or
control (including such tax information the Contributor could obtain using
reasonable efforts) and that is reasonably requested by the Operating
Partnership and not otherwise in the Operating Partnership’s possession or
control and to cooperate with the Operating Partnership with respect to the
filing of Tax Returns by the Operating Partnership.

     

    Section
4.10        SOLVENCY. The
Contributor has been solvent at all times prior to and, to the Contributor’s
knowledge, should remain solvent for no less than ninety (90) calendar days
following, the transfer of the Contributed Interests to the Operating
Partnership.

     

    Section
4.11        LITIGATION. There is
no action, suit or proceeding pending or, to the Contributor’s knowledge,
threatened against the Contributor affecting all or any portion of the
Contributed Interests or the Contributor’s ability to consummate the
transactions contemplated hereby which, if adversely determined, would adversely
affect the Contributor’s ability to so consummate the transactions contemplated
hereby. The Contributor knows of no outstanding order, writ, injunction or
decree of any Governmental Authority against or affecting all or any portion of
the Contributed Interests, which in any such case would impair the Contributors’
ability to enter into and perform all of its obligations under this
Agreement.

     

    Section
4.12        INVESTMENT. The
Contributor acknowledges that the offering and issuance of the OP Units to be
acquired pursuant to this Agreement are intended to be exempt from registration
under the Securities Act and that the Operating Partnership’s reliance on such
exemptions is predicated in part on the accuracy and completeness of the
representations and warranties of the Contributor contained herein. In
furtherance thereof, the Contributor represents and warrants to the Operating
Partnership as follows:


    
      
         


      

      
        13

        
          

        

      

      
         


      

    


    (a)         The
Contributor is an “accredited investor” (as such term is defined in Rule 501(a)
of Regulation D promulgated under the Securities Act). The Contributor has
accurately completed the Accredited Investor Questionnaire attached hereto as
Exhibit
C indicating
the basis for the Contributor’s accredited investor status. The Contributor
will, upon request, execute and/or deliver any additional documents deemed by
the Operating Partnership to be necessary or desirable to confirm the
Contributor’s accredited investor status.

     

    (b)         The
Contributor is acquiring the OP Units solely for its own account for the purpose
of investment and not as a nominee or agent for any other Person and not with a
view to, or for offer or sale in connection with, any distribution thereof in
violation of the federal securities Laws.

     

    (c)         The
Contributor is knowledgeable, sophisticated and experienced in business and
financial matters and the Contributor fully understands the limitations on
transfer imposed by the federal securities Laws. The Contributor is able to bear
the economic risk of holding the OP Units for an indefinite period and is able
to afford the complete loss of its investment in the OP Units; the Contributor
has received and reviewed all information and documents about or pertaining to
the Operating Partnership and the business and prospects of the Operating
Partnership and the issuance of the OP Units as the Contributor deems necessary
or desirable, and has been given the opportunity to obtain any additional
information or documents and to ask questions and receive answers about such
information and documents, the Operating Partnership and the business and
prospects of the Operating Partnership which the Contributor deems necessary or
desirable to evaluate the merits and risks related to its investment in the OP
Units; and the Contributor understands and has taken cognizance of all risk
factors related to the OP Units set forth in the Registration Statement. The
Contributor is relying upon its own independent analysis and assessment
(including with respect to Taxes), and the advice of the Contributor’s advisors
(including tax advisors), and not upon that of the Operating Partnership or any
of the Operating Partnership’s Affiliates, for purposes of evaluating, entering
into, and consummating the transactions contemplated hereby. The Contributor has
not been furnished with, and has not relied on any oral or written
representation in connection with the offering of the OP Units.

     

    (d)         The
Contributor acknowledges that the OP Units have not been registered under the
Securities Act and, therefore, may not be sold unless registered under the
Securities Act or an exemption from registration is available. The Contributor
acknowledges that its ability to sell or otherwise transfer the OP Units is
further restricted by certain provisions of the Operating Partnership Agreement
and may be further restricted by other applicable securities Laws.

     

    (e)         The
Contributor is, for purposes of the application of state securities laws, a
resident of the State of Delaware.

     

    Section
4.13        NO BROKERS OR
FINDERS. The
Contributor has not entered into any agreement and is not otherwise liable or
responsible to pay any brokers’ or finders’ fees or expenses to any Person with
respect to this Agreement or the purchase and issuance of the OP Units
contemplated hereby, except for any such person or entity the fees and expenses
for which the Contributor shall be solely responsible and pay.


    
      
         


      

      
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    Section
4.14        WAIVER OF RIGHTS UNDER
ORGANIZATIONAL AGREEMENT. The
Contributor hereby waives any rights or claims it may have under the
Organizational Agreement related to the transfer of the Contributed Interests to
the Operating Partnership by the members, of the Contributed Entities, including
but not limited to any notice requirements, rights of first refusal, rights of
first offer, drag-along rights and tag-along rights, and further waives
compliance with any terms or conditions under the Organizational Agreement with
respect to such transfer.

     

    Section
4.15        NO OTHER REPRESENTATIONS OR
WARRANTIES. Other
than the representations and warranties expressly set forth in this Article IV, the
Contributor shall not be deemed to have made any other representation or
warranty in connection with this Agreement or the transactions contemplated
hereby.

     

    Section 4.16       
SURVIVAL OF
REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTOR. The
parties hereto agree and acknowledge that the representations and warranties set
forth in this Article
IV shall survive the Closing for a period of one year; provided, however,
that the representations and warranties set forth in Sections 4.07, 4.08 and
4.09 shall survive the Closing until the expiration of the applicable statute of
limitations plus 30 days.

     

    ARTICLE
5


     

    COVENANTS
AND OTHER AGREEMENTS

     

    Section
5.01        COVENANTS OF THE
CONTRIBUTOR. From the
date hereof through the Closing, except as otherwise provided for or as
contemplated by this Agreement, the Contributor shall not:

     

    (a)         sell,
transfer or otherwise dispose of all or any portion of the Contributed Interests
or any interests therein and/or any of the Properties;

     

    (b)         mortgage,
pledge, hypothecate, encumber (or permit to become encumbered) all or any
portion of the Contributed Interests and/or any of the Properties;

     

    (c)         authorize
or consent to, or cause the Contributed Entities to sell, assign, transfer or
dispose of any of its assets and/or any of the Properties;

     

    (d)         except
as set forth on Schedule 5.01(d),
authorize or consent to, or cause the Contributed Entities to mortgage, pledge,
hypothecate, encumber (or permit to become encumbered) all or any portion of its
assets and/or any of the Properties;

     

    (e)         amend
the Organizational Agreement or other governing documents of the Contributed
Entities without the consent of the Operating Partnership;

     

    (f)          (i)
make, revoke or change any material Tax election or adopt or change any method
of accounting, (ii) enter into any settlement of or compromise any material Tax
liability. (iii) change any annual Tax accounting period, (iv) enter into a
closing agreement for any material amount of Tax, (v) surrender any right to any
material Tax refund, or (vi) file any amended Tax Return or refund claim with
respect to any material Tax; or


    
      
         


      

      
        15

        
          

        

      

      
         


      

    


    (g)         adopt
a plan of liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or reorganization with respect to the Contributed
Entities.

     

    Section
5.02        COMMERCIALLY REASONABLE
EFFORTS BY THE OPERATING PARTNERSHIP AND THE CONTRIBUTOR. Each of
the Operating Partnership and the Contributor shall use commercially reasonable
efforts and cooperate with each other in (i) promptly determining whether any
filings are required to be made or consents, approvals, waivers, permits or
authorizations are required to be obtained (under any applicable Law or
regulation or from any Governmental Authority or third party) in connection with
the transactions contemplated by this Agreement, and (ii) promptly making any
such filings, in furnishing information required in connection therewith and in
timely seeking to obtain any such consents, approvals, waivers, permits or
authorizations.

     

    ARTICLE
6


     

    CHANGES
TO FORM AGREEMENTS

     

    Section
6.01        CHANGES TO FORM
AGREEMENTS. The
Contributor agrees and confirms that the terms of the OP Units described in the
Registration Statement and the Exhibits thereto are not final and may be
modified without the Contributor’s consent. By executing this Agreement the
Contributor hereby authorizes the Operating Partnership and the REIT to, and
understands and agrees that the Operating Partnership and the REIT may, make
changes (including changes that may be deemed material) to the Operating
Partnership Agreement, the Registration Rights Agreement, and the Assignment and
Assumption and the Contributor agrees to receive the OP Units with such final
terms and conditions as the Operating Partnership and/or the REIT determines, in
their reasonable discretion.

     

    ARTICLE
7

     

    POWER
OF ATTORNEY

     

    Section
7.01        POWER OF
ATTORNEY. By
executing this Agreement, the Contributor hereby irrevocably constitutes and
appoints the Operating Partnership (or a substitute appointed by the Operating
Partnership) as its attorney-in-fact and agent with full power of substitution to
take any and all actions and execute any of the following agreements on the
Contributor’s behalf and in the Contributor’s name: the Operating Partnership
Agreement, the Registration Rights Agreement, the Indemnification Agreement, the
Assignment and Assumption and any other documents related to the consummation of
the Contribution, or any of the other transactions contemplated by this
Agreement on the Contributor’s behalf and in the Contributor’s name, as may be
deemed by the Operating Partnership as necessary or desirable to effectuate the
Contribution, the IPO, and the other transactions described herein. The
Contributor hereby grants to each attorney-in-fact full power and authority to
do and perform each and every act and thing which may be necessary, or
convenient, in connection with the foregoing, as fully, to all intents and
purposes, as the undersigned might or could do if personally present, hereby
ratifying and confirming all that such attorney-in-fact shall lawfully do or
cause to be done by authority hereof. Such power-of-attorney shall be deemed to
be coupled with an interest and shall be irrevocable and shall survive the
death, disability or dissolution of the Contributor.


    
      
         


      

      
        16

        
          

        

      

      
         


      

    


    ARTICLE
8


     

    GENERAL
PROVISIONS

     

    Section
8.01        NOTICES. All
notices and other communications under this Agreement shall be in writing and
shall be deemed given when (a) delivered personally, (b) five (5) Business Days
after being mailed by certified mail, return receipt requested and postage
prepaid, (c) one (1) Business Day after being sent by a nationally recognized
overnight courier or (d) transmitted by facsimile if confirmed within 24 hours
thereafter by a signed original sent in the manner provided in clause (a), (b)
or (c) to the parties at the addresses set forth below (or at such other address
for a party as shall be specified by notice from such party):

     

    
      
        	
                If
      to the Operating Partnership:

              	
                ARC
      Properties Operating Partnership, L.P.

              
	 
      	
                405
      Park Avenue

              
	 
      	
                New
      York, New York 10022

              
	 
      	
                Attention: William
      M. Kahane

              
	 
      	 
      
	 
      	
                with
      a copy to:

              
	 
      	 
      
	 
      	
                Proskauer
      Rose LLP

              
	 
      	
                Eleven
      Times Square

              
	 
      	
                New
      York, New York 10036

              
	 
      	
                Attention: 
      Peter M. Fass, Esq.

              
	 
      	
                Steven
      L. Lichtenfeld, Esq.

              
	 
      	 
      
	
                If
      to the Contributor:

              	
                ARC
      Real Estate Partners, LLC

              
	 
      	
                405
      Park Avenue

              
	 
      	
                New
      York, New York 10022

              
	 
      	
                Attention: William
      M. Kahane

              
	 
      	 
      
	 
      	
                with
      a copy to:

              
	 
      	 
      
	 
      	
                Proskauer
      Rose LLP

              
	 
      	
                Eleven
      Times Square

              
	 
      	
                New
      York, NY 10036

              
	 
      	
                Attention: 
      Peter M. Fass, Esq.

              
	 
      	
                Steven
      L. Lichtenfeld, Esq.

              


      

    

    


    Section
8.02        DEFINITIONS. For
purposes of this Agreement, the following terms shall have the following
meanings.

     

    (a)         “Affiliate” means, with respect to
any Person, a Person that, directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with the
specified Person. For the purposes of this definition, “control” (including,
with correlative meanings, the terms “controlled by” and “under common control
with”) as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
or policies of such Person, whether through the ownership of voting securities,
by agreement or otherwise.


    
      
         


      

      
        17

        
          

        

      

      
         


      

    


    (b)         “Agreement” has the meaning set
forth in the Preamble.

     

    (c)         “Amortizing Principal
Payment” means the principal
component of any regularly scheduled installment of principal and interest in
respect of Debt. The term “Amortizing Principal Payment” does not include the
principal component of (i) any voluntary prepayment of Debt, or (ii) any payment
made in respect of any Debt that has become due by reason of acceleration or the
occurrence or nonoccurrence of any event requiring a mandatory
prepayment.

     

    (d)         “ARC” means the American Realty
Capital group of companies.

     

    (e)         “Assignment and
Assumption” means an Assignment and
Assumption of Ownership Interests substantially in the form attached as Exhibit
D hereto.

     

    (f)          “Business Day” means any day
that is not a Saturday, Sunday or legal holiday in the State of New
York.

     

    (g)         “Claim” has the meaning set
forth in Section
3.09(b).

     

    (h)         “Claim Notice” has the meaning
set forth in Section
3.09(b).

     

    (i)          “Closing” has the meaning set
forth in Section
2.02.

     

    (j)           “Closing Date” has the meaning
set forth in Section
2.02.

     

    (k)         “Code” means the Internal
Revenue Code of 1986, as amended, together with the Treasury Regulations
promulgated or issued thereunder.

     

    (l)          “Contributed Entities” has the
meaning set forth in the Recitals.

     

    (m)        “Contributed Interests” has the
meaning set forth in the Recitals.

     

    (n)         “Contribution” has the meaning
set forth in the Recitals.

     

    (o)         “Contributor” has the meaning
set forth in the Preamble.

     

    (p)         “Contributor Indemnified Party”
has the meaning set forth in Section
3.09(a).

     

    (q)         “Contributor’s Formation Transaction
Value” has the meaning set forth in Section
1.02.

     

    (r)          “Cut-Off Date” means a date to be
established by the Operating Partnership for purposes of determining adjustments
to the Contributor’s Formation Transaction Value pursuant to Section 1.04 hereof,
which date shall be no earlier than ten (10) calendar days prior to the Closing
Date and no later than the calendar day prior to the Closing
Date.


    
      
         


      

      
        18

        
          

        

      

      
         


      

    

    (s)           “Cut-Off Date Cash
Balance” means all cash and cash
equivalents that would be shown on a balance sheet of the Property Owners
prepared on the Cut-Off Date in a manner consistent with historical accounting
practices applicable to the Property Owners to the extent the same derive from
operating income of the Property Owners and in any event excluding (i) cash and
cash equivalents consisting of loan proceeds, casualty insurance proceeds,
proceeds from condemnation or eminent domain proceedings, or proceeds from the
sale or other disposition of the Properties or any interest therein, or that are
otherwise derived from a source other than the operation, leasing, management or
occupancy of the Properties, and (ii) cash and cash equivalents consisting of
Non-Operating Expense Reserves made on or after February 1, 2011.

     

    (t)           “Debt” means, with respect to
any Person, without duplication, (a) its liabilities for borrowed money, (b) its
liabilities for the deferred purchase price of any property acquired by such
Person (excluding accounts payable arising in the ordinary course of business
but including, without limitation, all liabilities created or arising under any
conditional sale or other title retention agreement with respect to any such
property), (c) its capital lease obligations, and (d) all liabilities for
borrowed money secured by any Lien with respect to any property owned by such
Person (whether or not it has assumed or otherwise become liable for such
liabilities).

     

    (u)          “Effective Date” has the
meaning set forth in the Preamble.

     

    (v)          “Expiration Date” has the
meaning set forth in Section
3.09(d).

     

    (w)          “Extraordinary Expense
Prepayments” means, as of any date of
determination, all prepaid expenses of a Property Owner to the extent such
expenses relate to a date more than thirty (30) calendar days after such date of
determination.

     

    (x)           “Extraordinary Principal
Payment” means any payment of
principal in respect of Debt other than an Amortizing Principal
Payment.  The term “Extraordinary Principal
Payment” includes the principal component of (i) any voluntary prepayment of
Debt, or (ii) any payment made in respect of any Debt that has become due by
reason of acceleration or the occurrence or nonoccurrence of any event requiring
a mandatory prepayment.

     

    (y)          “Extraordinary Rent
Prepayments” means any prepayment of
rent and other fees and charges due or to become due to a Property Owner
pursuant to any lease or other occupancy agreement more than thirty (30)
calendar days in advance to the extent the same is received by a Property
Owner.

     

    (z)           “Final Adjustment” has the
meaning set forth in Section
1.04.

     

    (aa)         “Governmental Authority” means any government or
agency, bureau, board, commission, court, department, official, political
subdivision, tribunal or other instrumentality of any government, whether
federal, state or local, domestic or foreign.

     

    (bb)        “Indemnification Agreement”
means, if applicable, that certain Indemnification Agreement, dated the Closing
Date, by the Operating Partnership in favor of Nicholas S. Schorsch and William
M. Kahane in form and substance reasonably acceptable to the
parties.


    
      
         


      

      
        19

        
          

        

      

      
         


      

    

     

    (cc)        “IPO” has the meaning set forth
in the Recitals.

     

    (dd)        “IPO Price” has the meaning set
forth in the Recitals.

     

    (ee)         “Laws” means laws, statutes,
rules, regulations, codes, orders, ordinances, judgments, injunctions, decrees
and policies of any Governmental Authority.

     

    (ff)          “Liens” means all pledges,
claims, liens, charges, restrictions, controls, easements, rights of way,
exceptions, reservations, leases, licenses, grants, covenants and conditions,
encumbrances and security interests of any kind or nature
whatsoever.

     

    (gg)        “Losses” has the meaning set
forth in Section
3.09(a).

     

    (hh)        “Non-Operating Expense
Reserves” means any escrow, deposit or reserve required by the terms of
any agreement to which a Property Owner is a party or by which a Property Owner
or its assets are bound, other than Restricted Deposits.

     

    (ii)           “Operating Entity” means the Contributed
Entities and each of its Subsidiaries, including, without limitation, the
Property Owners.

     

    (jj)           “Operating Expenses” means all
normal and reasonable expenses of owning, operating, leasing, managing,
maintaining and occupying all real and personal property owned by a Property
Owner, including but not limited to:  (i) payments to, for the benefit
of or required in connection with personnel employed to manage, operate and
maintain a Property Owner or its properties; (ii) utility charges; (iii) costs
of heating, lighting, ventilating and air conditioning; (iv) premiums for
hazard, casualty, rent loss and liability insurance; (v) ad valorem real estate
and personal property taxes, installments of special assessments and sales tax
payments; (vi) expenses for maintenance and repair of buildings, grounds,
driveways and parking areas; (vii) costs of janitorial services, tools,
equipment and supplies; (viii) management fees, including, without limitation,
fees paid or payable to ARC or one or more of its Affiliates; (ix) landscaping,
lawn, shrub and tree trimming, fertilizing and care expenses; (x) equipment
lease payments; (xi) snow and ice removal expenses; (xii) advertising and
promotion expenses; (xiii) expenses related to the delivery of cable television,
internet access, telephone and similar services to tenants of a Property Owner
for a fee; (xiv) all security expenses; (xv) costs of printing, stationery and
office supplies; (xvi) attorneys’ fees and accountants’ fees, (xvii) capital
improvement and expenditures; (xviii) costs of warranty repairs; (xix) fees of
consultants; (xx) costs in connection with or in contemplation of sale or
refinancing, such as costs of appraisals, environmental or engineering studies;
and (xxi) income, franchise and other taxes.

     

    (kk)        “Operating Partnership” has the
meaning set forth in the Preamble.

     

    (ll)          “Operating Partnership
Agreement” has the meaning set forth in the Section
2.03.

     

    (mm)      “OP Units” has the meaning set
forth in the Recitals.


    
      
         


      

      
        20

        
          

        

      

      
         


      

    

     

    (nn)       “Organizational
Agreements” means the limited
liability company agreements of the Contributed Entities.

     

    (oo)       “Outside Date” has the meaning
set forth in Section
2.06.

     

    (pp)       “Past Due Payables” means, as of any date of
determination, all liabilities and other obligations of a Property Owner that
(i) are due and remain unpaid as of such date of determination, and (ii) all
expenses incurred by a Property Owner that remain unpaid as of such date of
determination to the extent such expenses relate to a date more than thirty (30)
calendar days prior to the date of determination.

     

    (qq)    
   “Permitted
Exceptions” means the exceptions to the title of the Properties set forth
on Exhibit
E hereto.

     

    (rr)         “Permitted Mortgage
Indebtedness” means the mortgage indebtedness encumbering the Properties
as set forth on Exhibit
F hereto.

     

    (ss)   
     “Person” means an individual,
partnership, corporation, limited liability company, joint venture, association,
trust, unincorporated organization or other entity, or a government or agency or
political subdivision thereof.

     

    (tt)      
   “Property
Owner” means the entity owned directly or indirectly by the Contributed
Entities which hold fee title to the Properties set forth opposite its name on
Exhibit A
hereto.

     

    (uu)   
    “Properties” has the meaning
set forth in the Recitals.

     

    (vv)     
  “Registration
Rights Agreement” has the meaning set forth in Section
2.01(c)(iii).

     

    (ww)   
   “Registration
Statement” has the meaning set forth in Section
2.06.

     

    (xx)         “REIT Common Stock” has the
meaning set forth in the Recitals.

     

    (yy)  
      “REIT” has the meaning set
forth in the Recitals.

     

    (zz)         “Restricted Deposit” means any escrow,
deposit or reserve required by the terms of any agreement to which a Property
Owner is a party or by which the Operating Entity or its assets are bound and
established or maintained to pay or provide for payment of any Operating Expense
of such Property Owner, including, without limitation, escrows for taxes,
insurance and other charges, and deposits and reserves for repairs,
replacements, capital expenditures, leasing commissions and tenant
improvements.

     

    (aaa)   
   “SEC”
has the meaning set forth in Section
2.01(a)(i).

     

    (bbb) 
    “SEC
Effective Date” means the date the Registration statement is declared
effective by the SEC.


    
      
         


      

      
        21

        
          

        

      

      
         


      

    

     

    (ccc)      “Securities Act” has the
meaning set forth in Section
2.01(a)(i).

     

    (ddd)     “Stock” shall
mean all shares, options, warrants, general or limited partnership interests or
other equivalents (regardless of how designated) of or in a corporation,
partnership or equivalent entity whether voting or nonvoting, including common
stock, preferred stock or any other “equity security” (as such term is defined
in Rule 3a11-1 of the General Rules and Regulations promulgated by the
Securities and Exchange Commission under the Securities Exchange Act of 1934, as
amended).

     

    (eee)      “Subsidiary” shall mean, with
respect to any Person, (a) any corporation of which an aggregate of more than
fifty percent (50%) of the outstanding Stock having ordinary voting power to
elect a majority of the board of directors of such corporation (irrespective of
whether, at the time, Stock of any other class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time, directly or indirectly, owned legally or
beneficially by such Person and/or one or more Subsidiaries of such Person, or
with respect to which any such Person has the right to vote or designate the
vote of fifty percent (50%) or more of such Stock whether by proxy, agreement,
operation of law or otherwise, and (b) any partnership or limited liability
company in which such Person and/or one or more Subsidiaries of such Person
shall have an interest (whether in the form of voting or participation in
profits or capital contribution) of more than fifty percent (50%) or of which
any such Person is a general partner or may exercise the powers of a general
partner.

     

    (fff)        “Target Cash Balance” means, as of any date of
determination, an amount, determined by the Operating Partnership in its
reasonable discretion, equal to the sum of the following:

     

    (i)           all
security deposits and similar deposits due or that may become due to tenants of
a Property or other third parties;

     

    (ii)           the
aggregate amount of all Restricted Deposits and other escrow, deposits and
reserves that are otherwise historically or customarily maintained by a Property
Owner, including, without limitation, escrows for taxes, insurance and other
charges, and deposits and reserves for repairs, replacements, capital
expenditures, leasing commissions and tenant improvements, whether or not so
required, but excluding Non-Operating Expense Reserves;

     

    (iii)          the
aggregate amount of all payments of principal, interest and/or late fees on Debt
that are due on such date or scheduled to become due during the period of thirty
(30) calendar days following such date; and

     

    (iv)         all
Operating Expenses incurred or to be incurred by the a Property Owner that are
due on such date or scheduled to become due during the period of thirty (30)
calendar days following such date.


    
      
         


      

      
        22

        
          

        

      

      
         


      

    


    (ggg)     “Tax” or “Taxes” means (i) all federal,
state, local and foreign net or gross income, gross receipts, turnover, license,
payroll, employment, excise, severance, stamp, occupation, premium, windfall
profits, environmental (including taxes under Code Section 59A), customs,
duties, export taxes and withholdings, capital stock, franchise, profits,
withholding, social security (or similar), unemployment, supplementary,
retirement system, disability, real property, personal property, sales, use,
transfer, registration, value added, recording, intangible, documentary, goods
and services, ad valorem, net proceeds, net worth, special assessments, workers’
compensation, utility, production, gains, alternative or add-on minimum,
estimated, or other tax of any kind whatsoever, together with any interest,
penalty, or addition thereto payable in connection with such taxes, whether
disputed or not and (ii) any liability of any Person for the payment of amounts
of the type described in clause (i) as a transferee, successor or payable
pursuant to a contractual obligation.

     

    (hhh)     “Tax Return” means any return,
declaration, report, claim for refund, document, or information return or
statement relating to Taxes, or other filing required to be supplied to any
taxing authority or jurisdiction (foreign or domestic) with respect to Taxes,
including any schedules or attachments thereto, and including any amendments
thereof.

     

    (iii)         “Tax Sharing Agreement” shall
mean any written or unwritten agreement, indemnity or other arrangement for the
allocation or payment of Tax liabilities or payment for Tax benefits between an
Operating Entity and any Person other than (i) the indemnity provided pursuant
to this Agreement, and (ii) customary Tax indemnification or other arrangements
contained in a commercial agreement entered into in the ordinary course of
business the primary purpose of which does not relate to Taxes..

     

    (jjj)          “Third Party Claims” has the
meaning set forth in Section
3.09(c).

     

    


    Section
8.03          COUNTERPARTS.  This
Agreement may be executed in counterparts, all of which shall be considered one
and the same agreement and shall become effective when one or more counterparts
have been signed by each party and delivered to each other party.

     

    Section
8.04          ENTIRE AGREEMENT;
THIRD-PARTY BENEFICIARIES.  This
Agreement, including, without limitation, the exhibits and schedules hereto,
constitute the entire agreement and supersede each prior agreement and
understanding, whether written or oral, among the parties regarding the subject
matter of this Agreement.  Except as set forth in Section 3.09, this
Agreement is not intended to confer any rights or remedies on any Person other
than the parties hereto.

     

    Section
8.05          GOVERNING
LAW.  This
Agreement shall be governed by, and construed in accordance with, the Laws of
the State of New York, regardless of any Laws that might otherwise govern under
applicable principles of conflicts of laws thereof.

     

    Section
8.06          ASSIGNMENT.  This
Agreement shall be binding upon, and shall be enforceable by and inure to the
benefit of, the parties hereto and their respective heirs, legal
representatives, successors and assigns; provided, however, that this
Agreement may not be assigned (including by operation of law) by either party
without the prior written consent of the other party and any attempted
assignment without such consent shall be null and void and of no force and
effect, except that the Operating Partnership may assign its rights and
obligations hereunder to an Affiliate.


    
      
         


      

      
        23

        
          

        

      

      
         


      

    

     

    Section
8.07          JURISDICTION.  The
parties hereto hereby (a) submit to the exclusive jurisdiction of any state or
federal court sitting in Borough of Manhattan, City of New York, State of New
York, with respect to any dispute arising out of this Agreement or any
transaction contemplated hereby to the extent such courts would have subject
matter jurisdiction with respect to such dispute, and (b) irrevocably waive, and
agree not to assert by way of motion, defense, or otherwise, in any such action,
any claim that it is not subject personally to the jurisdiction of the
above-named courts, that its property is exempt or immune from attachment or
execution, that the action is brought in an inconvenient forum, or that the
venue of the action is improper.

     

    Section
8.08          SEVERABILITY.  Each
provision of this Agreement will be interpreted so as to be effective and valid
under applicable Law, but if any provision is held invalid, illegal or
unenforceable under applicable Law in any jurisdiction, then such invalidity,
illegality or unenforceability will not affect any other provision, and this
Agreement will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision had never been included
herein.

     

    Section
8.09          RULES OF
CONSTRUCTION.

     

    (a)           The
parties hereto agree that they have participated in the negotiation, preparation
and execution of this Agreement and, therefore, waive the application of any
Law, regulation, holding or rule of construction providing that ambiguities in
an agreement or other document will be construed against the party drafting such
agreement or document.

     

    (b)           The
words “hereof,” “herein” and “herewith” and words of similar import shall,
unless otherwise stated, be construed to refer to this Agreement as a whole and
not to any particular provision of this Agreement, and article, section,
paragraph, exhibit and schedule references are to the articles, sections,
paragraphs, exhibits and schedules of this Agreement unless otherwise
specified.  Whenever the words “include,” “includes” or “including”
are used in this Agreement, they shall be deemed to be followed by the words
“without limitation.” All terms defined in this Agreement shall have the defined
meanings contained herein when used in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein.  The
definitions contained in this Agreement are applicable to the singular as well
as the plural forms of such terms and to the masculine as well as to the
feminine and neuter genders of such terms.  Unless explicitly stated
otherwise herein, any agreement, instrument or statute defined or referred to
herein or in any agreement or instrument that is referred to herein means such
agreement, instrument or statute as from time to time amended, qualified or
supplemented, including (in the case of agreements and instruments) by waiver or
consent and (in the case of statutes) by succession of comparable successor
statutes and all attachments thereto and instruments incorporated
therein.  References to a Person are also to its permitted successors
and assigns.

     

    Section
8.10          EQUITABLE
REMEDIES.  The
parties agree that irreparable damage would
occur to the Operating Partnership in the event that any of the provisions of
this Agreement were not performed in accordance with their specific terms or
were otherwise breached.  It is accordingly agreed that the Operating
Partnership shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement by the Contributor and to enforce specifically the
terms and provisions hereof, this being in addition to any other remedy to which
the Operating Partnership is entitled under this Agreement or otherwise at law
or in equity.  Notwithstanding the foregoing, this Agreement shall not
bar any equitable remedies otherwise available to the Contributor pursuant to
the terms and provisions contained in Section
3.09.


    
      
         


      

      
        24

        
          

        

      

      
         


      

    


    Section
8.11          TIME OF THE
ESSENCE.  Time
is of the essence with respect to all obligations under this
Agreement.

     

    Section
8.12          DESCRIPTIVE
HEADINGS.  The
descriptive headings herein are inserted for convenience only and are not
intended to be part of or to affect the meaning or interpretation of this
Agreement.

     

    Section
8.13          NO PERSONAL LIABILITY
CONFERRED.  This
Agreement shall not create or permit any personal liability or obligation on the
part of any officer, director, partner, member, employee or shareholder of the
Operating Partnership or the Contributor.

     

    Section
8.14          AMENDMENTS.  This
Agreement may be amended, supplemented or otherwise modified only by written
instrument signed by both parties.

     

    [SIGNATURE
PAGES FOLLOW]


    
      
         


      

      
        25

        
          

        

      

      
         


      

    


    IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by
their respective duly authorized officers or representatives, all as of the
Effective Date.

     

    
      
        
          
            
              	
                      Effective
      Date:  February 4, 2011

                    	
                      ARC
      PROPERTIES OPERATING

                    
	 
      	 
      	
                      PARTNERSHIP,
      L.P.

                    
	 
      	 
      	 
      
	 
      	
                      By:

                    	
                      AMERICAN
      REALTY CAPITAL

                    
	 
      	 
      	
                      PROPERTIES,
      INC.

                    
	 
      	 
      	
                      Its
      general partner

                    
	 
      	 
      	 
      
	 
      	
                      By:

                    	/s/
      Nicholas S. Schorsch  
	 
      	 
      	
                      Name:
      Nicholas S. Schorsch

                    
	 
      	 
      	
                      Title:   Chief
      Executive Officer

                    
	 
      	 
      
	 
      	
                      ARC
      REAL ESTATE PARTNERS, LLC

                    
	 
      	 
      
	 
      	
                      By:

                    	/s/
      Nicholas S. Schorsch  
	 
      	 
      	
                      Name:  Nicholas
      S. Schorsch

                    
	 
      	 
      	
                      Title:    Manager

                    


            

          

        

      

    

     

    
      Signature
Page to Contribution Agreement

    

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Schedule
5.01(d)


    With the
consent of the Operating Partnership, which consent shall not be unreasonably
withheld, conditioned or delayed, the Contributor may, or may cause the
Contributed Entities to, negotiate, authorize or consent to documentation with
respect to a refinancing of all or any of the Properties (other than the
property owned by ARC HDCOLSC001, LLC), subject to the closing of the
IPO.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Exhibit
A

     

    List of Properties and
Property Owners

     

    
      
        	
                Property Owner

              	 
      	
                Property

              
	 
      	 
      	 
      
	
                CRE
      JV Mixed Five CT Branch Holdings LLC

              	 
      	
                458
      Ocean Avenue (450), New London, CT

              
	
                CRE
      JV Mixed Five CT Branch Holdings LLC

              	 
      	
                6
      Killingworth Road, Higganum, CT

              
	
                CRE
      JV Mixed Five DE Branch Holdings LLC

              	 
      	
                5
      West Commerce Street, Smyrna, DE

              
	
                CRE
      JV Mixed Five IL 4 Branch Holdings LLC

              	 
      	
                7310
      W Grand Avenue (7312), Elmwood Park, IL

              
	
                CRE
      JV Mixed Five MI 7 Branch Holdings LLC

              	 
      	
                48950
      Van Dyke Avenue, Utica, MI

              
	
                CRE
      JV Mixed Five MI 7 Branch Holdings LLC

              	 
      	
                633
      Notre Dame, Grosse Pointe, MI

              
	
                CRE
      JV Mixed Five NH Branch Holdings LLC

              	 
      	
                405
      Portland Avenue, Rollinsford, NH

              
	
                CRE
      JV Mixed Five NH Branch Holdings LLC

              	 
      	
                54
      Main Street, Pittsfield, NH

              
	
                CRE
      JV Mixed Five NY 1 Branch Holdings LLC

              	 
      	
                17
      South Market Street, Johnstown, NY

              
	
                CRE
      JV Mixed Five NY 1 Branch Holdings LLC

              	 
      	
                501
      State Street, Schenectady, NY

              
	
                CRE
      JV Mixed Five NY 1 Branch Holdings LLC

              	 
      	
                501
      Western Avenue, Albany, NY

              
	
                CRE
      JV Mixed Five OH 1 Branch Holdings LLC

              	 
      	
                10300
      Northfield, Northfield, OH

              
	
                CRE
      JV Mixed Five OH 1 Branch Holdings LLC

              	 
      	
                38115
      Euclid Avenue, Willoughby, OH

              
	
                CRE
      JV Mixed Five OH 1 Branch Holdings LLC

              	 
      	
                7820
      Plaza Boulevard, Mentor, OH

              
	
                CRE
      JV Mixed Five OH 2 Branch Holdings LLC

              	 
      	
                16622
      Harvard Avenue, Cleveland, OH

              
	
                CRE
      JV Mixed Five OH 2 Branch Holdings LLC

              	 
      	
                17411
      Lorain Avenue, Cleveland, OH

              
	
                CRE
      JV Mixed Five OH 2 Branch Holdings LLC

              	 
      	
                4300
      Clark Avenue, Cleveland, OH

              
	
                CRE
      JV Mixed Five OH 3 Branch Holdings LLC

              	 
      	
                14534
      Madison Avenue, Lakewood, OH

              
	
                CRE
      JV Mixed Five OH 3 Branch Holdings LLC

              	 
      	
                21550
      Center Ridge Road, Rocky River, OH

              
	
                CRE
      JV Mixed Five OH 4 Branch Holdings LLC

              	 
      	
                9243
      Broadview Road, Broadview Heights, OH

              
	
                CRE
      JV Mixed Five PA Branch Holdings LLC

              	 
      	
                100
      Essex Avenue, Narberth, PA

              
	
                CRE
      JV Mixed Five PA Branch Holdings LLC

              	 
      	
                1635
      East Derby Road, Havertown, PA

              
	
                CRE
      JV Mixed Five PA Branch Holdings LLC

              	 
      	
                560
      Donner Avenue, Monesson, PA

              
	
                CRE
      JV Mixed Five PA Branch Holdings LLC

              	 
      	
                600
      Market St/600 Merchant St, Ambridge, PA

              
	
                CRE
      JV Mixed Five VT Branch Holdings LLC

              	 
      	
                152
      S Main Street, St. Albans, VT

              
	
                CRE
      JV Mixed Five VT Branch Holdings LLC

              	 
      	
                155
      Maple Street, White River Junction, VT

              
	
                CRE
      JV Mixed Five VT Branch Holdings LLC

              	 
      	
                177
      Main Street, Poultney, VT

              
	
                CRE
      JV Mixed Five MI 2 Branch Holdings LLC

              	 
      	
                31231
      Harper Avenue, St. Clair Shores, MI

              
	
                CRE
      JV Mixed Five MI 2 Branch Holdings LLC

              	 
      	
                69055
      Main Street, Richmond, MI

              
	
                CRE
      JV Mixed Five MI 3 Branch Holdings LLC

              	 
      	
                2050
      12 Mile Road, Warren, MI

              
	
                CRE
      JV Mixed Five MI 3 Branch Holdings LLC

              	 
      	
                27777
      Southfield Road, Lathrup Village, MI

              
	
                CRE
      JV Mixed Five MI 4 Branch Holdings LLC

              	 
      	
                23801
      Michigan Avenue, Dearborn, MI

              
	
                CRE
      JV Mixed Five MI 4 Branch Holdings LLC

              	 
      	
                15930
      Michigan Avenue, Dearborn, MI

              
	
                CRE
      JV Mixed Five NY 3 Branch Holdings LLC

              	 
      	
                89
      Oriskany Boulevard, Whitesboro, NY

              
	
                CRE
      JV Mixed Five NY 3 Branch Holdings LLC

              	 
      	
                N
      Chenango & Genesee, Greene, NY

              
	
                CRE
      JV Mixed Five NY 4 Branch Holdings LLC

              	 
      	
                2000
      Monroe Avenue, Rochester, NY

              
	
                CRE
      JV Mixed Five NY 4 Branch Holdings LLC

              	 
      	
                212
      Main Street, East Aurora, NY

              
	
                CRE
      JV Mixed Five NY 4 Branch Holdings LLC

              	 
      	
                3180
      Sheridan Drive, Amherst (Buffalo), NY

              
	
                CRE
      JV Mixed Five OH 5 Branch Holdings LLC

              	 
      	
                214
      High Street, Wadsworth,
OH

              


      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        	
                CRE
      JV Mixed Five OH 5 Branch Holdings LLC

              	 
      	
                3720
      Center Road, Brunswick, OH

              
	
                CRE
      JV Mixed Five OH 5 Branch Holdings LLC

              	 
      	
                955
      Boardman-Poland Road, Boardman, OH

              
	
                CRE
      JV Mixed Five OH 6 Branch Holdings LLC

              	 
      	
                315
      E Main Street, Louisville, OH

              
	
                CRE
      JV Mixed Five OH 6 Branch Holdings LLC

              	 
      	
                780
      W State Street, Alliance, OH

              
	
                CRE
      JV Mixed Five IL 2 Branch Holdings LLC

              	 
      	
                417
      S Water Street, Wilmington, IL

              
	
                CRE
      JV Mixed Five IL 2 Branch Holdings LLC

              	 
      	
                6720
      W 111 Street, Worth, IL

              
	
                CRE
      JV Mixed Five MI 1 Branch Holdings LLC

              	 
      	
                24624
      W 10 Mile Road, Southfield, MI

              
	
                CRE
      JV Mixed Five MI 1 Branch Holdings LLC

              	 
      	
                36520
      Moravian, Clinton Township, MI

              
	
                CRE
      JV Mixed Five MI 6 Branch Holdings LLC

              	 
      	
                16530
      E Warren, Detroit, MI

              
	
                CRE
      JV Mixed Five MI 6 Branch Holdings LLC

              	 
      	
                19601
      Vernier, Harper Woods, MI

              
	
                CRE
      JV Mixed Five NY 2 Branch Holdings LLC

              	 
      	
                118
      Main Street, Whitehall, NY

              
	
                CRE
      JV Mixed Five NY 2 Branch Holdings LLC

              	 
      	
                Route
      32, Vails Gate, NY

              
	
                CRE
      JV Mixed Five NY 5 Branch Holdings LLC

              	 
      	
                5 S
      Broome Street, Port Jervis, NY

              
	
                CRE
      JV Mixed Five IL 3 Branch Holdings LLC

              	 
      	
                2854
      W Cermak Street (Road), Chicago, IL

              
	
                CRE
      JV Mixed Five IL 3 Branch Holdings LLC

              	 
      	
                4231
      Joliet Avenue, Lyons, IL

              
	
                CRE
      JV Mixed Five IL 3 Branch Holdings LLC

              	 
      	
                9244
      S Chicago Avenue, Chicago, IL

              
	
                CRE
      JV Mixed Five IL 5 Branch Holdings LLC

              	 
      	
                12004
      S Pulaski Road, Alsip, IL

              
	
                CRE
      JV Mixed Five IL 5 Branch Holdings LLC

              	 
      	
                2917
      W 95 Street, Evergreen Park, IL

              
	
                CRE
      JV Mixed Five MI 5 Branch Holdings LLC

              	 
      	
                12380
      Woodward Avenue, Highland Park, MI

              
	
                CRE
      JV Mixed Five MI 5 Branch Holdings LLC

              	 
      	
                16841
      Schaefer Road, Detroit, MI

              
	
                CRE
      JV Mixed Five MI 5 Branch Holdings LLC

              	 
      	
                31441
      Plymouth Road, Livonia, MI

              
	
                CRE
      JV Mixed Five OH 7 Branch Holdings LLC

              	 
      	
                2200
      Wales Avenue, NW, Massillon, OH

              
	
                CRE
      JV Mixed Five OH 7 Branch Holdings LLC

              	 
      	
                54
      Federal Avenue NE, Massillon, OH

              
	
                ARC
      HDCOLSC001, LLC

              	
                  

              	
                420
      Foster Brothers Drive, West Columbia,
SC

              


      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Exhibit
B

     

    FIRPTA
Affidavit

     

    Section
1445 of the Internal Revenue Code of 1986, as amended (the “Internal Revenue
Code”) provides that a transferee of a U.S. real property interest must
withhold tax if the transferor is a foreign person.  For U.S. tax
purposes (including Section 1445), the owner of a disregarded entity (which has
legal title to a U.S. real property interest under local law) will be the
transferor of the property and not the disregarded entity.  To inform
ARC Properties Operating Partnership, L.P., a Delaware limited partnership
(“Transferee”),
that withholding of tax is not required upon the disposition of a U.S. real
property interest by ARC Real Estate Partners, LLC (“Transferor”), the
undersigned hereby certifies the following on behalf of Transferor:

     

    1.           Transferor
is not a foreign corporation, foreign partnership, foreign trust, or foreign
estate (as those terms are defined in the Internal Revenue Code and Income Tax
Regulations);

     

    2.           Transferor
is not a disregarded entity as defined in § 1.1445-2(b)(2)(iii);

     

    3.           Transferor’s
U.S. employer identification number is ________________; and

     

    4.           Transferor’s
office address is 405 Park Avenue, New York, NY 10022.

     

    Transferor
understands that this certification may be disclosed to the Internal Revenue
Service by Transferee and that any false statement contained herein could be
punished by fine, imprisonment or both.

     

    Under
penalties of perjury, I declare that I have examined this certification and, to
the best of my knowledge and belief, it is true, correct and complete, and
further declare that I have authority to sign this document on behalf of
Transferor.

     

    
      
        
          
            
              	 
      	 
      
	 
      	 
      
	 
      	
                      Name:

                    	 
      
	 
      	 
      
	 
      	
                      Title:

                    	 
      


            

          

        

      

    

    Date:
__________, 2011


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Exhibit
C

     

    Accredited Investor
Questionnaire

     

    ACCREDITED INVESTOR STATUS FOR
ENTITIES (Please check the applicable subparagraphs):

     

    1.       ̈          We
are either:  a bank as defined in Section 3(a)(2) of the Securities
Act of 1933, as amended (the “Securities Act”), or a savings
and loan association or other institution as defined in Section 3(a)(5)(A) of
the Securities Act whether acting in its individual or fiduciary capacity; a
broker or dealer registered pursuant to Section 15 of the Securities Exchange
Act of 1934, as amended; an insurance company as defined in Section 2(a)(13) of
the Securities Act; an investment company registered under the Investment
Company Act of 1940, as amended (the “Investment Company Act”) or a business
development company as defined in Section 2(a)(48) of the Investment Company
Act; a Small Business Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business Investment Act
of 1958, as amended; a plan established and maintained by a state, its political
subdivisions, or any agency or instrumentality of a state or its political
subdivisions, for the benefit of its employees, and such plan has total assets
in excess of $5,000,000; or an employee benefit plan within the meaning of the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and (i) the investment
decision is made by a plan fiduciary, as defined in section 3(21) of ERISA,
which is either a bank, savings and loan association, insurance company, or
registered investment adviser, (ii) the employee benefit plan has total assets
in excess of $5,000,000 or, (iii) an employee benefit plan that is a
self-directed plan, with investment decisions made solely by persons that are
accredited investors (within the meaning of Rule 501(a) under the Securities
Act).

     

    2.       ̈          We
are a private business development company as defined in Section 202(a)(22) of
the Investment Advisers Act of 1940, as amended.

     

    3.       ̈          We
are an organization described in Section 501(c)(3) of the Internal Revenue Code
of 1986, as amended, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring OP Units, with
total assets in excess of $5,000,000.

     

    4.       ̈          We
are a trust with total assets in excess of $5,000,000, that was not formed for
the specific purpose of purchasing OP Units and whose purchase is directed by a
sophisticated person as described in Rule 506(b)(2)(ii) under the Securities
Act.

     

    5.       ̈          We
are an entity in which all of the equity owners are accredited investors (within
the meaning of Rule 501(a) under the Securities Act).


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Exhibit
D

     

    Form of Assignment And
Assumption of Ownership Interests

     

    This
Assignment and Assumption of Ownership Interests (“Assignment”) is made and
entered into effective as of__________, 2011 (the “Effective Date”), by and among
ARC Real Estate Partners, LLC, a Delaware limited liability company (“Assignor”), and ARC Properties
Operating Partnership, L.P., a Delaware limited partnership (“Assignee”).

     

    RECITALS

     

    A.           Assignor
is the legal and beneficial owner of one hundred percent (100%) of the limited
liability company interest (collectively, the “Ownership Interests”) in ARC
Income Properties, LLC, a Delaware limited liability company, and American
Realty Capital Partners, LLC, a Delaware limited liability company
(collectively, the “Companies”).

     

    B.           Assignor
desires to assign the Ownership Interests to Assignee, and Assignee desires to
assume the Ownership Interests from Assignor.  It is the intent of the
parties that, upon this Assignment, Assignor will withdraw as a member (“Owner”) of each of the
Companies, and Assignee will become a substitute member of each of the
Companies.

     

    ASSIGNMENT

     

    The
parties agree as follows:

     

    1.           Assignment.  For
value received, the receipt and sufficiency of which are hereby acknowledged,
Assignor hereby assigns, transfers, conveys and delivers the Ownership Interests
and all of its right, title and interest in the Companies to
Assignee.  Upon the execution of this Assignment, the records of each
Company, including the limited liability company agreement, as amended,
supplemented or otherwise modified from time to time (each, an “Organizational Agreement”), shall be amended to reflect
the change in ownership of the Ownership Interests.

     

    2.           Assumption.  Assignee
hereby accepts the foregoing assignment and assumes the agreements and
obligations of an Owner under each Organizational Agreement, including the
obligation to fulfill the obligations of Assignor in accordance with the terms
of each Organizational Agreement with respect to the Ownership
Interests.  Assignee’s execution of this Assignment constitutes the
execution of a counterpart signature page to each Organizational
Agreement.  Assignee acknowledges it has received and reviewed a copy
of each Organizational Agreement.

     

    3.           Withdrawal and Substitution
of Owner.  Assignor hereby withdraws as Owner of each Company,
and Assignee is hereby admitted and substituted as Owner of each Company with
respect to the Ownership Interests.

     

    4.           Representations and
Warranties.  Assignor hereby represents and warrants to
Assignee that the Ownership Interests are free and clear of all liens,
assignments, security interests, options and adverse claims to or encumbrances
on title of any kind or character.  Each of Assignor and Assignee
hereby represents and warrants that the execution and delivery by it of this
Assignment will not violate or constitute a default under the terms or
provisions of any agreement, document or instrument to which it is
bound.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    5.           Effective
Date.  This Assignment is effective as of the Effective Date
set forth above.

     

    6.           Successors and
Assigns.  This Assignment is binding on and inures to the
benefit of the parties and their respective successors and assigns.

     

    7.           Governing
Law.  This Assignment, the rights and obligations of the
parties hereto, and any claims and disputes relating thereto, are governed by
and shall be construed in accordance with the laws of the State of
Delaware.

     

    8.           Counterparts.  This
Assignment may be executed in counterparts, each of which will be deemed an
original, but all of which together will constitute the same
instrument.

     

    9.           Future
Cooperation.  Each of the parties hereto agrees to cooperate at
all times from and after the date hereof with respect to all of the matters
described herein, and to execute such further assignments, releases,
assumptions, amendments of agreements, notifications and other documents as may
be reasonably requested for the purpose of giving effect to, or evidencing or
giving notice of, the transactions contemplated by this Assignment.

     

    [Remainder
of Page Intentionally Left Blank;

    Signature
Page Follows.]


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    IN WITNESS WHEREOF, the parties
have executed this Assignment as of the date first above written.

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            	 
      	
                                    ASSIGNOR:

                                  
	 
      	 
      
	 
      	
                                    ARC
      REAL ESTATE PARTNERS, LLC

                                  
	 
      	 
      
	 
      	
                                    By:

                                  	 
      
	 
      	 
      	
                                    Name:

                                  
	 
      	 
      	
                                    Title:

                                  
	 
      	 
      
	 
      	
                                    ASSIGNEE:

                                  
	 
      	 
      
	 
      	
                                    ARC
      PROPERTIES OPERATING

                                  
	 	 	
                                    PARTNERSHIP,
      L.P.

                                  
	 	 	 
	 
      	
                                    By:

                                  	
                                    AMERICAN
      REALTY CAPITAL

                                  
	 
      	 
      	
                                    PROPERTIES,
      INC.

                                  
	 
      	 
      	
                                    Its
      general partner

                                  
	 
      	 
      
	 
      	
                                    By:

                                  	 
      
	 
      	 
      	
                                    Name:

                                  
	 
      	 
      	
                                    Title:

                                  


                          

                        

                      

                    

                  

                

              

            

          

        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    

      Exhibit
E

       

      Permitted
Exceptions

       

      
        	
                1.

              	
                Consents
      by Property Owner or any former owner of a Property for the erection of
      any structure or structures on, under or above any street or streets on
      which the land upon which a Property is constructed may
    abut.

              


      

       

      
        	
                2.

              	
                Encroachments
      of stoops, areas, roof cornices, window trims, vent pipes, cellar doors,
      steps, columns and column bases, flue pipes, signs, piers, lintels, window
      sills, fire escapes, satellite dishes, ledges, fences, coping, retaining
      walls and yard walls, air conditioners and the like, if any, on, under or
      above any street or highway, a Property or any adjoining
      property.

              


      

       

      
        	
                3.

              	
                Variations
      between tax lot lines and lines of record
title.

              


      

       

      
        	
                4.

              	
                Covenants,
      agreements, licenses, easements and restrictions of record, if any, to the
      extent  not otherwise described in this
  Exhibit.

              


      

       

      
        	
                5.

              	
                Rights
      of utility companies to lay, maintain and repair pipes, lines, conduits,
      cable boxes and other installations on, under and across a Property and
      any rights, easements and licenses in favor of, or agreements with, any
      public utility company, including but not limited to, gas, electricity,
      telephone, telegraph and cable television services,
      if  any.

              


      

       

      
        	
                6.

              	
                Rights
      of tenants pursuant to leases with a Property Owner or any predecessor fee
      owner of the applicable Property or other statutory tenants and others
      claiming by, through or under the
tenants.

              


      

       

      
        	
                7.

              	
                Any
      lien or encumbrance (including, without limitation, any mechanics’ and
      materialmen’s  liens) the removal of which is the obligation of
      a tenant pursuant to its related
lease.

              


      

       

      
        	
                8.

              	
                All
      notes or notices of or violations of law or municipal ordinances, orders
      or requirements noted in or issued by any state or municipal departments
      having jurisdiction, now or hereafter against or affecting a
      Property.

              


      

       

      
        	
                9.

              	
                Subject
      to adjustment as herein provided, real estate taxes, tax liens, water and
      sewer charges, assessments and vault charges, and the liens of any of the
      foregoing.

              


      

       

      
        	
                10.

              	
                Zoning
      and building regulations, ordinances, and requirements adopted by any
      governmental or municipal authority having jurisdiction over a Property,
      and amendments and additions thereto now in force and effect, which relate
      to a Property.

              


      

       

      
        	
                11.

              	
                Any
      financing statements, chattel mortgages, encumbrances, or mechanics’ or
      other liens entered into by, or arising from, any financing statements
      filed on a day more than five (5) years prior to the Closing and any
      financing statements, chattel mortgages, encumbrances or mechanics’ or
      other liens filed against property no longer on a
  Property.

              


      


      
        
           


        

        
           


          
            

          

        

        
           


        

      

       

      
        	
                12.

              	
                A
      certificate or certificates of occupancy, or no certificate or
      certificates of occupancy (or, if there be such certificate(s), that there
      exist any variances between such certificate(s) and the actual state or
      use(s) a Property.

              


      

       

      
        	
                13.

              	
                Actual
      conditions and exceptions to title contained in the title policy for a
      Property.

              


      

       

      
        	
                14.

              	
                All
      Liens or encumbrances relating to the Permitted Mortgage
      Indebtedness.

              


      


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      Exhibit
F

       

      Permitted Mortgage
Indebtedness

       

      The
mortgage indebtedness encumbering the Properties is as follows:

       

      
        	
                 
      

              	
                ·

              	
                $13,850,000
      under the loan agreement, dated June 24, 2010, between Ladder Capital
      Finance LLC, as lender, and ARC HDCOLSC001, LLC, as
    borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $9,613,114
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Fifteen MI 2 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,599,151
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Fifteen MI 3 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,962,352
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five MI 5 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $4,435,900
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five MI 7 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $5,005,457
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five OH 1 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $3,585,233
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five OH 2 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,812,983
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five OH 3 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $1,209,935
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five OH 4 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $3,586,021
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five OH 5 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,216,075
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five OH 6 Branch Holdings
      LLC, as borrower.

              


      


      
        
           


        

        
           


          
            

          

        

        
           


        

      

       

      
        	
                 
      

              	
                ·

              	
                $2,785,256
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five OH 7 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $1,471,370
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five CT Branch Holdings LLC,
      as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $1,080,200
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five DE Branch Holdings LLC,
      as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,926,980
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five IL 2 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,598,800
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five IL 4 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,193,306
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five IL 5 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $1,298,130
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five NH Branch Holdings LLC,
      as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $4,031,963
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five NY 1 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,292,943
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five NY 2 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $3,119,763
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five NY 3 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $3,386,165
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five NY 4 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $844,888
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five NY 5 Branch Holdings
      LLC, as borrower.

              


      


      
        
           


        

        
           


          
            

          

        

        
           


        

      

       

      
        	
                 
      

              	
                ·

              	
                $6,395,039
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five NY 5 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,796,504
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five VT Branch Holdings LLC,
      as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $2,321,977
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five MI 6 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $4,861,024
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five MI 4 Branch Holdings
      LLC, as borrower.

              


      

       

      
        	
                 
      

              	
                ·

              	
                $3,746,984
      under the loan agreement, dated July 21, 2006, between UBS Real Estate
      Investments Inc., as lender, and CRE JV Mixed Five IL 3 Branch Holdings
      LLC, as borrower.