Document:

Employment Agreement

 EXHIBIT 10.1 
 SECURE COMPUTING CORPORATION 
 EMPLOYMENT AGREEMENT 
 This Employment Agreement (“Agreement”) is effective July 1, 2008 (the “Effective Date”) by and between Secure Computing
Corporation (the “Company”) and Daniel P. Ryan (“Employee”) (the Company and Employee are collectively referred to herein as the “Parties” or singularly as a “Party”). 
 WITNESSETH: 
 WHEREAS,
the Company desires to employ Employee, and Employee desires to be employed by the Company, this Agreement having been prepared by the Parties to set forth their understandings with respect to their employment relationship; and 
 WHEREAS, Employee is being employed by the Company in a position involving the trust and confidence of the Company. 
 NOW, THEREFORE, in consideration of their mutual promises and covenants and for other good and valuable consideration, the sufficiency of which is
hereby acknowledged, Employee and the Company agree as follows: 
  

	1.	Position and Responsibilities. 

  

	 	a.	Employee shall be employed as the Chief Executive Officer and President of the Company. Employee shall report to the Company’s Board of Directors. Employee shall generally be
in charge of, and responsible for, the overall operations of the Company and shall perform all of the duties required of his position, as directed by the Company’s Board of Directors or its designee. 

  

	 	b.	Employee will, to the best of his ability, devote his full working time and best efforts to the performance of his duties hereunder and to the conduct of the business and affairs of
the Company. 

  

	 	c.	Employee will observe the rules, regulations, policies and/or procedures that the Company may now or hereafter establish governing the conduct of its business, except to the extent
that any such rules, regulations, policies and/or procedures are inconsistent with the terms of this Agreement, in which case the terms of this Agreement shall control. It is acknowledged and agreed that any of the rules, regulations, policies
and/or procedures of the Company may be modified by the Company at any time with or without advance notice; provided, however, that notice of modification shall be a prerequisite to Employee’s duty to observe same. 

  

	 	d.	 Employee represents to the Company that the execution of this Agreement by Employee and the performance of Employee’s obligations hereunder will not conflict
with or result in the breach of any provision of, or constitute a default under, any other agreement or undertaking to which Employee is a party or by which Employee is or may be bound. Employee hereby warrants and represents 

  

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to the Company that Employee is under no contractual or other restrictions which would prevent Employee from entering into or performing all or any of
Employee’s obligations under this Agreement. Employee understands and acknowledges that the Company is relying upon such warranties and representations in its employment of Employee hereunder. 

  

	2.	At-Will Employment/Termination of Employment. 

  

	 	a.	Employee understands and acknowledges that his employment with the Company is for an unspecified duration and constitutes “at-will” employment. Employee also understands
that any representation to the contrary is unauthorized and not valid unless obtained in writing and signed by the Company’s Board of Directors or its designee. Employee acknowledges that this employment relationship may be terminated at any
time, with or without good cause or for any or no cause, at the option either of the Company or Employee, with or without notice. 

  

	 	b.	The Company shall have the right, on written notice: 

  

	 	(1)	to terminate employee immediately at any time for cause, or 

  

	 	(2)	to terminate employee at any time without cause, provided that (A) the Company shall be obligated to pay to Employee severance in an amount equal to fifteen
(15) months’ base salary less applicable taxes and other required withholdings and any amount Employee may owe to the Company, payable in full immediately upon such termination, contingent upon Employee signing a Separation and Release
Agreement in a form satisfactory to the Company which assures, among other things, that Employee will not commence any type of litigation or other claims as a result of the termination, (B) vesting of the 150,000 share restricted stock grant
made to Employee on September 10, 2007 will accelerate in full, and (C) the Company will pay the premium costs of Employee’s medical, dental and vision benefits during the severance period provided Employee makes the necessary
elections pursuant to COBRA. 

  

	 	c.	For purposes of this Section, “cause” shall include: conviction of any felony or of any crime involving moral turpitude, participation in fraud against the Company,
intentional damage to any property of the Company, wrongful disclosure of any trade secrets or other confidential information of the Company to any of its competitors, or a material breach of Section 4 (Confidential Information) of this
Agreement. 

  

	3.	Compensation. Subject to the other provisions contained herein, in consideration of Employee’s services rendered under this Agreement and for Employee’s willingness
to forego other employment opportunities or competitive activities during the term of this Agreement and any applicable severance period, the Company shall compensate Employee as follows: 

  

	 	a.	Base Salary. The Company shall pay Employee an annual salary of $350,000, before deductions, to be paid consistent with the Company’s regular payroll practices
applicable to similarly-situated employees for so long as this Agreement is in effect or until such date as the Company, after discussion with Employee, increases the base salary. 

  

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	 	b.	Expenses. The Company will reimburse Employee for all necessary and reasonable out-of-pocket business expenses in accordance with the Company’s policies and procedures.

  

	 	c.	Bonus Program. Employee will be eligible for an annual target bonus of $350,000 ($87,500 quarterly, tied to financial performance targets established by the Compensation
Committee or the entire Board of Directors), without a cap, to be paid consistent with the Company’s regular payroll practices applicable to similarly-situated employees, for so long as this Agreement is in effect or until such date as the
Company, after discussion with Employee, increases Employee’s target bonus eligibility. 

  

	 	d.	Fringe Benefits. Employee shall be eligible to participate in the Company’s standard employee benefits package comparable to similarly situated employees of the Company
employed in the United States. 

  

	 	e.	Vacation. Employee will be eligible for twenty (20) days of vacation per calendar year. 

  

	 	f.	Equity Awards. Promptly following execution of this Agreement, Employee shall receive 75,000 restricted shares (or restricted stock units) of the Company and 162,000 Company
stock options with standard vesting and other terms, including an exercise price for the stock options equal to the fair market value of the Company’s common stock on the date of grant (expected to be July 25, in accordance with the
Company’s standard practices), with the understanding that each July 1, the Board will consider making another restricted stock (or restricted stock unit) grant or option grant, depending on Employee’s performance.

  

	 	g.	Effect of Employee’s Death. The vesting of all of Employee’s outstanding equity awards will accelerate in full upon Employees’ death. 

 

	4.	Confidential Information. 

  

	 	a.	 Company Information. Employee agrees at all times during the term of his employment and thereafter, to hold in strictest confidence, and not to use or
disclose, except for the benefit of the Company, or to disclose to any person, firm or corporation without written authorization of the Company’s Board of Directors or its designee, any Confidential Information of the Company. Employee
understands that “Confidential Information” means any Company proprietary information, technical data, trade secrets or know-how, including, but not limited to, research, product plans, products, services, customer lists and customers
(including, but not limited to, customers of the Company on whom he called or 

  

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with whom he became acquainted during the term of his employment), markets, software, developments, inventions, processes, formulas, technology, designs,
drawings, engineering data, hardware configuration information, marketing, financial or other business information disclosed to Employee by the Company either directly or indirectly in writing, orally or by drawings or observation of parts or
equipment. Employee further understands that Confidential Information does not include any of the foregoing items which has become publicly known and made generally available through no wrongful act by him or of others who were under confidentiality
obligations as to the item or items involved or improvements or new versions thereof. 

  

	 	b.	Former Employer Information. Employee agrees that he will not, during the term of his employment with the Company, improperly use or disclose any proprietary information or
trade secrets of any former or concurrent employer or other person or entity and that he will not bring onto the premises of the Company any unpublished document or proprietary information belonging to any such employer, person or entity unless
consented to in writing by such employer, person or entity. 

  

	 	c.	Third Party Information. Employee recognizes that the Company has received and in the future will receive from third parties their confidential or proprietary information
subject to a duty on the Company’s part to maintain the confidentiality of such information and to use it only for certain limited purposes. Employee agrees to hold all such confidential or proprietary information in the strictest confidence
and not to disclose it to any person, firm or corporation or to use it except as necessary in carrying out his work for the Company consistent with the Company’s agreement with such third party. 

  

	5.	Conflicting Employment. Employee agrees that, during the term of his employment with the Company, he will not engage in any other employment, occupation, consulting or other
business activity directly related to the business in which the Company is now involved or becomes involved during the term of his employment, nor will he engage in any other activities that conflict with his obligations to the Company.

  

	6.	Returning Company Documents. Employee agrees that, at the time of leaving the employ of the Company, he will deliver to the Company (and will not keep in his possession,
recreate or deliver to anyone else) any and all devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings blueprints, sketches, materials, equipment, other documents or property, or reproductions of any
aforementioned items developed by him pursuant to his employment with the Company or otherwise belonging to the Company, its successors or assigns. In the event of the termination of his employment, Employee agrees to sign and deliver the
“Termination Certification” attached hereto as Exhibit A. 

  

	7.	Notification of New Employer. In the event that Employee leaves the employ of the Company, he hereby grants consent to notification by the Company to his new employer about
his rights and obligations under this Agreement. 

  

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	8.	Non-solicitation. 

  

	 	a.	Non-solicitation of Employees. To the full extent permitted by law, for a period of fifteen (15) months immediately following the termination of his relationship with
the Company for any reason, whether voluntary or involuntary, Employee shall not, by himself or in collaboration with others, either directly or indirectly solicit, induce, recruit or encourage any of the Company’s employees to leave their
employment, or take away such employees, or attempt to solicit, induce, recruit, encourage or take away employees of the Company, either for himself or any other person or entity. 

  

	 	b.	Non-solicitation of Business. To the full extent permitted by law, for a period of fifteen (15) months immediately following the termination of his relationship with the
Company for any reason, whether voluntary or involuntary, Employee will not divert or attempt to divert from the Company any business the Company had enjoyed or solicited from its customers or potential customers during the fifteen (15) months
prior to his termination of employment. 

  

	9.	Arbitration and Equitable Relief. 

  

	 	a.	Arbitration. Except as provided in Section 9(b) below, Employee agrees that any dispute or controversy arising out of, relating to, or concerning any interpretation,
construction, performance or breach of this Agreement shall be settled by arbitration to be held in Ramsey County, Minnesota, in accordance with the employment dispute resolution rules then in effect of the American Arbitration Association. The
arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator shall be final, conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator’s decision in
any court having jurisdiction. The Company and Employee shall each pay one-half of the costs and expenses of such arbitration, and each shall separately pay their own counsel fees and expenses. 

 This arbitration clause constitutes a waiver of Employee’s right to a jury trial and relates to the resolution of all disputes relating to all
aspects of the employer/employee relationship (except as provided in Section 9(b) below), including, but not limited to, the following claims: 
  

	 	(1)	Any and all claims for wrongful discharge of employment; breach of contract, both express and implied; breach of the covenant of good faith and fair dealing, both express and
implied; negligent or intentional infliction of emotional distress; negligent or intentional misrepresentation; negligent or intentional interference with contract or prospective economic advantage; and defamation; 

  

	 	(2)	Any and all claims for violation of any federal, state or municipal statute, including, but not limited to, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991,
the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act of 1990, and the Fair Labor Standards Act; and 

  

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	 	(3)	Any and all claims arising out of any other laws and regulations relating to employment or employment discrimination. 

  

	 	b.	Equitable Remedies. Employee agrees that it would be impossible or inadequate to measure and calculate the Company’s damages from any breach of the covenants set forth
in Sections 4, 6 and 8 herein. Accordingly, Employee agrees that if he breaches any of such sections, the Company will have available, in addition to any other right or remedy available, the right to obtain an injunction from a court of competent
jurisdiction restraining such breach or threatened breach and to specific performance of any such provision of this Agreement. Employee further agrees that no bond or other security shall be required in obtaining such equitable relief and he hereby
consents to the issuance of such injunction and to the ordering of specific performance. 

  

	 	c.	Consideration. Employee understands that each Party’s promise to resolve claims by arbitration in accordance with the provisions of this Agreement, rather than through
the courts, is consideration for the other Party’s like promise. Employee further understands that he is offered continued employment in consideration of his promise to arbitrate claims. 

  

	10.	Severability and Scope of Obligations. Should any of Employee’s obligations under this Agreement be found overbroad, illegal or unenforceable in any respect, such
illegality or unenforceability shall not affect the other provisions of this Agreement, all of which shall remain enforceable in accordance with their terms. Despite the preceding sentence, should any of Employee’s obligations under this
Agreement be found illegal or unenforceable because it is too broad with respect to duration, geographical scope or subject matter, such obligation shall be deemed and construed to be reduced to the maximum duration, geographical scope and subject
matter allowable under applicable law. 

  

	11.	Applicable Law. This Agreement shall be governed by, and construed and enforced in all respects under the laws of the State of Minnesota. 

  

	12.	Binding Effect. This Agreement shall be binding upon the Parties hereto and upon their respective executors, administrators, legal representatives, successors and assigns.

  

	13.	Notices. Written notice under this Agreement shall be effectuated by Federal Express delivery, addressed as follows: 

  

			
	If to the Company:	 	Secure Computing Corporation
		 	Attention: General Counsel
		 	2340 Energy Park Drive
		 	St. Paul, MN 55108

  

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	If to Employee:	 	Dan Ryan
		 	 [Address to be provided to the Company
 separately]

 Either Party may, by like notice to the other Party, change its notice address. 
  

	14.	Entire Agreement. This Agreement constitutes the entire agreement between the Parties with respect to the subject matter hereof, and supersedes all prior agreements. Without
limiting the foregoing, notwithstanding the terms of Employee’s agreement with the Company dated May 28, 2008, Employee’s temporary bonus under that agreement shall not be payable with respect to any period after June 30, 2008.
Any amendments to this Agreement must be made in writing and duly executed by each of the Parties or by an authorized representative or agent of each such Party. 

  

	15.	Acknowledgement. Employee hereby acknowledges that he has read the foregoing Agreement, that he fully understands and accepts the terms hereof, and that the Company gave his
the opportunity to consult with an attorney or some other third Party to explain the meaning of the terms of this Agreement prior to his signing this Agreement. 

 IN WITNESS WHEREOF, the Parties hereto, either individually or by a duly authorized representative, have executed this Agreement as of the day and year
first written above. 
  

									
	DANIEL P. RYAN	 		 	SECURE COMPUTING CORPORATION
					
	By:	 	 /s/ Daniel P. Ryan
	 		 	By:	 	 /s/ Richard L. Scott

		 		 		 		 	Richard L. Scott, Chairman
			
	Date: 7/15/08	 		 	Date: 7/15/08

  

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 EXHIBIT A 
 SECURE COMPUTING CORPORATION 
 TERMINATION CERTIFICATION 
 In accordance with my Employment Agreement, I hereby certify the following: 
 I do not have in my possession, nor have I failed to return, any devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, other
documents or property, or reproduction of any aforementioned items belonging to SECURE COMPUTING CORPORATION, its subsidiaries, affiliates, successors or assigns (together, the “Company”). 
 I have complied with all the terms of the Company’s Employment Agreement signed by me, including the reporting of any inventions and original works
of authorship (as defined therein), conceived or made by me (solely or jointly with others) covered by that agreement. 
 In compliance with
the Employment Agreement, I will preserve as confidential all trade secrets, confidential knowledge, data or other proprietary information relating to products, processes, know-how, designs, formulas, developmental or experimental work, computer
programs, data bases, other original works of authorship, customer lists, business plans, financial information or other subject matter pertaining to any business of the Company or any of its employees, clients, consultants or licensees. 

I further agree that for fifteen (15) months from this date, I will not directly or indirectly through others, solicit, induce, recruit or
encourage any of the Company’s employees to leave their employment or engage in any behavior that is in violation of my ongoing responsibilities under my Employment Agreement. 
  

							
	Date:	 	  
	 		  	
				
		 		 		  	  

		 		 		  	(Employee’s Signature)
				
		 		 		  	  

		 		 		  	(Type/Print Employee’s Name)Escrow Agreement

 EXHIBIT 4.3 
 ESCROW AGREEMENT 
 THIS ESCROW AGREEMENT
(the “Agreement”) is made and entered into as of the 6th day of February, 2008, by and between Paladin Realty Income
Properties, Inc., a Maryland corporation (the “Company”), Paladin Realty Securities, LLC (the “Dealer Manager”) and Wells Fargo Bank, N.A., as escrow agent (the “Escrow Agent”). 
 WHEREAS, the Company proposes to offer for sale, on a continuing basis (the “Offering”) up to $850,000,000 in shares of the
Company’s common stock, par value $0.01 per share (the “Shares”) pursuant to the terms of the prospectus (the “Prospectus”) contained in the registration statement on Form S-11, as amended, as initially filed
with the Securities and Exchange Commission under the Securities Act of 1933, as amended, on October 23, 2007. 
 WHEREAS, Dealer Manager, a FINRA registered broker-dealer, has agreed to serve as the dealer manager for the Offering and will offer the Shares through other registered broker-dealers that are members of the FINRA (the
“Dealers”); 
 WHEREAS, it is anticipated that investors will subscribe for the Shares and will provide the Dealer
Manager with subscription payments for such Shares (the “Subscription Payments”), which subscriptions will be contingent upon the Company’s acceptances of such investors as shareholders; 
 WHEREAS, the Company and the Dealer Manager desire to deposit funds contributed by the Subscribers (as defined below) with the Escrow Agent, to be
held for the benefit of the Subscribers and the Company in accordance with the terms of this Agreement; 
 WHEREAS, the Escrow Agent
has agreed to receive and hold in escrow all Subscription Payments until the investors are admitted as stockholders and to hold and distribute such Subscription Payments in accordance with the terms and conditions herein set forth; and 

WHEREAS, the Escrow Agent is willing to accept appointment as the escrow agent for only the expressed duties, terms and conditions outlined
herein. 
 NOW, THEREFORE, in consideration of the premises and agreements set forth herein, the parties hereto agree as follows:

 1. Appointment of Escrow Agent. The Company and the Dealer Manager hereby appoint the Escrow Agent to serve as escrow agent,
and the Escrow Agent hereby accepts such appointment, each in accordance with the terms of this Agreement. The Company and the Dealer Manager hereby acknowledge that the status of the Escrow Agent is that of agent only for the limited purposes set
forth herein, and hereby agree that they will not represent that the Escrow Agent has investigated the desirability or advisability of investment in the Shares or has approved, endorsed or passed upon the merits of the investment therein. The
Company and the Dealer Manager further agree that the name of the Escrow Agent shall not be used in any manner in connection with the offer or sale of the Shares other than to state that the Escrow Agent has agreed to serve as escrow agent for the
limited purposes set forth herein. 

 2. Proceeds. Investors subscribing to purchase Shares (the “Subscriber”)
will be instructed by the Dealer Manager or the Dealers to remit the Subscription Payments in the form of checks, drafts or money orders payable to the order of, or funds wired in favor of, “Paladin Realty Income Properties, Inc.” (the
“Escrow Account”). Within three (3) business days of receipt of the Subscription Payments, the Dealer Manager or the Dealers shall remit to the Escrow Agent the Subscription Payments. Such Subscription Payments shall be
retained in the Escrow Account by the Escrow Agent and invested as set forth in Section 7 and shall be deposited within one (1) business day of receipt. The Escrow Agent shall forward directly to the Company or the Company’s designee
any subscription documents received from Subscribers on a daily basis via overnight courier. 
 In the event that any Subscription Payments
deposited in the Escrow Account prove uncollectible after the funds represented thereby have been released by the Escrow Agent to the Company, then the Dealer Manager or Company shall promptly reimburse the Escrow Agent for any and all costs
incurred for such, upon request, and the Escrow Agent shall deliver the uncollectible Subscription Payment to the Dealer Manager or the Company. Notwithstanding the foregoing, if any Subscriber exercises any right provided by law to rescind his or
her subscription, the Escrow Agent shall, upon notice from the Company or Dealer Manager, return to such Subscriber all Subscription Payments pertaining to such subscription, together with any earnings thereon during the period that such payments
were held by the Escrow Agent under this Agreement. 
 3. Subscriber Identity. Within three (3) business days after
receipt of the Subscription Payments, the Dealer Manager or the Dealers shall furnish to the Escrow Agent each accepted Subscriber’s name, address, social security number or tax identification number, number of Shares purchased and purchase
price remitted. All proceeds so deposited shall be considered the property of the Subscribers and shall be held for the benefit of such Subscribers and shall not be: (i) commingled with the monies or become an asset of the Company, or
(ii) subject to any liens or charges by the Company or the Escrow Agent, or judgments or creditors’ claims against the Company, until released to the Company as hereinafter provided. The Escrow Agent will not use the information provided
to it by the Company for any purpose other than to fulfill its obligations as the Escrow Agent. The Escrow Agent agrees to treat all Subscriber information as confidential. 
 4. Disbursement of Proceeds. Upon facsimile or electronic notice from the Dealer Manager or the Company to the Escrow Agent, on a weekly
basis (and more frequently, if requested by the Company), the Escrow Agent shall disburse to the Company the amount of Subscription Payments received and all interest that has posted thereon (the “Collected Funds”) since the last
report. 
 5. Duty and Liability of the Escrow Agent. The sole duty of the Escrow Agent, other than as herein specified, shall
be to receive the Subscribers’ Subscription Payments and hold them subject to release, in accordance herewith, and the Escrow Agent shall be under no 

 
duty to determine whether the Company or Dealer Manager is complying with requirements of this Agreement or the Prospectus in tendering to the Escrow Agent
said proceeds of the sale of the Shares. The Escrow Agent may conclusively rely upon and shall be protected in acting upon any statement, certificate, notice, request, consent, order or other document reasonably believed by it to be genuine and to
have been signed or presented by the proper party or parties. The Escrow Agent shall have no duty or liability to verify any such statement, certificate, notice, request, consent, order or other document, and its sole responsibility shall be to act
only as expressly set forth in this Agreement. The Escrow Agent shall be under no obligation to institute or defend any action, suit or proceeding in connection with this Agreement unless first indemnified to its satisfaction. The Escrow Agent may
consult and hire counsel in respect of any question arising under this Agreement, and the Escrow Agent shall not be liable for any action taken or omitted in good faith upon advice of such counsel. 
 The Escrow Agent is acting solely as escrow agent hereunder and owes no duties, covenants or obligations, fiduciary or otherwise, to any other person by
reason of this Agreement, except as otherwise stated herein, and no implied duties, covenants or obligations, fiduciary or otherwise, shall be read into this Agreement against the Escrow Agent. In no event shall the Escrow Agent be liable,
directly or indirectly, for any special, indirect or consequential losses or damages of any kind whatsoever (including without limitation lost profits), even if the Escrow Agent has been advised of the possibility of such losses or damages and
regardless of the form of action. The parties agree that the Escrow Agent has no role in the preparation of the Offering documents, has not reviewed any such documents and makes no representations or warranties with respect to the information
contained therein or omitted therefrom. The Escrow Agent agrees that it may be named in the Prospectus and offering documents, to the extent necessary to describe this Agreement and the duties of the Escrow Agent herein. The Escrow Agent shall have
no obligation, duty or liability with respect to compliance with any federal or state securities, disclosure or tax laws concerning the offering documents or the issuance, offering or sale of the Shares. The Escrow Agent shall have no duty or
obligation to monitor the application and use of the Subscriber funds once transferred to the Company, that being the sole obligation and responsibility of the Company. 
 6. Escrow Agent Fee. The Escrow Agent shall be entitled to compensation for its services, as stated in the fee schedule attached hereto as Exhibit A, which compensation shall be paid by the
Company. Subject to the provisions of Section 9, the fee agreed upon for the services rendered hereunder in Exhibit A is intended as full compensation for the Escrow Agent’s services as contemplated by this Agreement.
Notwithstanding anything contained herein to the contrary, in no event shall any fee, reimbursement for costs and expenses, indemnification for damages incurred by the Escrow Agent or monies whatsoever be paid out of or chargeable to the income of
assets of the Escrow Account. 
 7. Investment of Subscription Payments. The Escrow Agent shall invest all Subscription
Payments and any investment income thereon as set forth in Exhibit B hereto, or as set forth in any subsequent written instruction signed by the Company’s Chief Financial Officer. Any interest received by the Escrow Agent with respect to
the Subscription Payments, including reinvested interest shall become part of the proceeds of the Escrow Account (the “Escrow Income”), and shall be disbursed to the Company as provided herein. For tax reporting purposes, all
interest or other taxable income earned on the Subscription Payments in any tax year shall be taxable to the person or entity receiving the interest or other taxable income. 

 The Escrow Agent is hereby authorized and directed to sell or redeem any such investments as it deems
necessary to make any payments or distributions required under this Escrow Agreement. The Escrow Agent shall have no responsibility or liability for any loss which may result from any investment or sale of investment made pursuant to this Escrow
Agreement. The Escrow Agent is hereby authorized, in making or disposing of any investment permitted by this Escrow Agreement, to deal with itself (in its individual capacity) or with any one or more of its affiliates, whether it or any such
affiliate is acting as agent of the Escrow Agent or for any third person or dealing as principal for its own account. The Parties acknowledge that the Escrow Agent is not providing investment supervision, recommendations, or advice. 
 The Company shall, at or prior to the execution of this Agreement, provide the Escrow Agent with certified tax identification numbers by furnishing
appropriate IRS forms W-9 or W-8 and other forms and documents that the Escrow Agent may reasonably request. The parties hereto understand that if such tax reporting documentation is not so certified to the Escrow Agent, the Escrow Agent may be
required by the Internal Revenue Code of 1986, as amended, to withhold a portion of any interest or other income earned on the Subscription Payments pursuant to this Agreement. 
 To the extent that the Escrow Agent becomes liable for the payment of any taxes in respect of income derived from the investment of funds held or
payments made hereunder, the Escrow Agent shall satisfy such liability to the extent possible from the Collected Funds. The Company agrees to indemnify and hold the Escrow Agent harmless from and against any taxes, additions for late payment,
interest, penalties and other expenses that may be assessed against the Escrow Agent on or with respect to any payment or other activities under this Agreement unless any such tax, addition for late payment, interest, penalties and other expenses
shall arise out of or be caused by the gross negligence or willful misconduct of the Escrow Agent. 
 8. Notices. All notices,
requests, demands, and other communications under this Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of service if served personally on the party to whom notice is to be given, (b) on the day of
transmission if sent by facsimile transmission to the facsimile number given below, and written confirmation of receipt is obtained promptly after completion of transmission, (c) on the day after delivery to Federal Express or similar overnight
courier or the Express Mail service maintained by the United States Postal Service, or (d) on the fifth day after mailing, if mailed to the party to whom notice is to be given, by first class mail, registered or certified, postage prepaid, and
properly addressed, return receipt requested, to the party as follows: 
 If to Company: 
 Paladin Realty Income Properties, Inc. 
 10880
Wilshire Blvd. 
 Suite 1400 
 Los
Angeles, California 90024 
 Attention: Whitney A. Greaves, Chief Operating Officer 
 Fax: (310) 996-8708 

 If to the Dealer Manager: 
 Paladin Realty Securities, LLC 
 10880 Wilshire Blvd. 
 Suite 1400 
 Los Angeles, California 90024

 Attention: Jerry Boucher, National Sales Manager 
 Fax: (310) 996-8708 
 If to the Escrow Agent: 
 Wells Fargo Bank, N.A. 
 Corporate, Municipal
and Escrow Solutions 
 666 Walnut Street 
 MAC N8200-034 
 Des Moines, IA 50309 
 Attention: Lisa Reidburn 
 Fax: (515) 245-8532 
 Wires to the Escrow Agent should be directed to the following: 
 Wells Fargo Bank, N,A. 
 ABA 121000248 
 Acct Name – Trust Wire Clearing 
 Acct Number – 0000405200 
 Attention: Lisa Reidburn, (515) 245-3256 
 Ref: Paladin Realty Income Properties, Inc. 
 Any party may change its address for purposes of this paragraph by giving the other party written
notice of the new address in the manner set forth above. 
 9. Indemnification of the Escrow Agent. The Company and the Dealer
Manager hereby jointly and severally indemnify and hold the Escrow Agent (and its officers, directors, employees and agents) harmless from and against any and all loss, claim, liability, cost, damage and expense, including, without limitation,
reasonable counsel fees and expenses, which the Escrow Agent may suffer or incur by reason of any action, claim or proceeding brought against the Escrow Agent arising out of or relating in any way to this Agreement or any transaction to which this
Agreement relates unless such action, claim or proceeding is the result of the willful misconduct or gross negligence of the Escrow Agent. The provisions of this section shall survive the termination of this Agreement and the resignation or removal
of the Escrow Agent. 
 THE ESCROW AGENT SHALL NOT BE LIABLE, DIRECTLY OR INDIRECTLY, FOR ANY (I) DAMAGES, LOSSES OR EXPENSES ARISING OUT OF THE
SERVICES PROVIDED 

 
HEREUNDER, OTHER THAN DAMAGES, LOSSES OR EXPENSES WHICH HAVE BEEN FINALLY ADJUDICATED TO HAVE DIRECTLY RESULTED FROM THE ESCROW AGENT’S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT, OR (II) SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES OR LOSSES OF ANY KIND WHATSOEVER (INCLUDING WITHOUT LIMITATION LOST PROFITS), EVEN IF THE ESCROW AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSSES OR
DAMAGES AND REGARDLESS OF THE FORM OF ACTION. 
 10. Successors and Assigns. 
 (a) Except as otherwise provided in this Agreement, no party hereto shall assign this Agreement or any rights or obligations hereunder without the prior
written consent of the other party hereto and any such attempted assignment without such prior written consent shall be void and of no force and effect. This Agreement shall inure to the benefit of and shall be binding upon the heirs, executors,
administrators, successors and permitted assigns of the parties hereto. 
 (b) Notwithstanding the above, any corporation or association into
which the Escrow Agent may be converted or merged, or with which it may be consolidated, or to which it may sell or transfer all or substantially all of its corporate trust business and assets as a whole or substantially as a whole, or any
corporation or association resulting from any such conversion, sale, merger, consolidation or transfer to which the Escrow Agent is a party, shall be and become the successor Escrow Agent under this Agreement and shall have and succeed to the
rights, powers, duties, immunities and privileges as its predecessor, without the execution or filing of any instrument or paper or the performance any further act. 
 11. Term. This Agreement shall terminate within thirty (30) days receipt of written notice of termination by the Company and Dealer Manager to the Escrow Agent. 
 12. Governing Law; Jurisdiction. This Agreement shall be construed, performed, and enforced in accordance with, and governed by, the
internal laws of the State of Delaware, without giving effect to the principles of conflicts of laws thereof. Each party hereby consents to the personal jurisdiction and venue of any court of competent jurisdiction in the State of Delaware.

 13. Severability. In the event that any part of this Agreement is declared by any court or other judicial or administrative
body to be null, void, or unenforceable, said provision shall survive to the extent it is not so declared, and all of the other provisions of this Agreement shall remain in full force and effect. 
 14. Amendments; Waivers. This Agreement may be amended or modified, and any of the terms, covenants, representations, warranties, or
conditions hereof may be waived, only by a written instrument executed by the parties hereto or, in the case of a waiver, by the party waiving compliance. Any waiver by any party of any condition, or of the breach of any provision, term, covenant,
representation, or warranty contained in this Agreement, in any one or more instances, shall not be deemed to be nor construed as further or continuing waiver of any such condition, or of the breach of any other provision, term, covenant,
representation, or warranty of this Agreement. 

 15. Entire Agreement; Counterparts. This Agreement contains the entire understanding among
the parties hereto with respect to the escrow contemplated hereby and supersedes and replaces all prior and contemporaneous agreements and understandings, oral or written, with regard to such escrow. This Agreement, and any amendments hereto, may be
executed by the parties hereto in one or more counterparts, each of which shall be deemed an original. 
 16. Section Headings.
The section headings in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement. 
 17. Disputes. In the event of a disagreement among any of the parties to this Agreement, or among them or any other person resulting in adverse claims and demands being made in connection with or from any property in the
Escrow Account, the Escrow Agent shall be entitled to refuse to comply with any such claims or demands as long as such disagreement may continue, and in so refusing, shall make no delivery or other disposition of any property then held by it in the
Escrow Account under this Agreement, and in so doing, the Escrow Agent shall be entitled to continue to refrain from acting until (i) the right of adverse claimants shall have been finally settled by binding arbitration or finally adjudicated
in a court assuming and having jurisdiction of the property involved herein or affected hereby or (ii) all differences shall have been adjusted by agreement and the Escrow Agent shall have been notified in writing of such agreement signed by
the parties hereto. 
 In the event of such dispute, the Escrow Agent shall be entitled, in its discretion and judgment, to tender into the
registry or custody of any court of competent jurisdiction all money or property in its hands under this Agreement, together with such legal pleadings as the Escrow Agent deem appropriate, and thereupon be discharged from all further duties and
liabilities under this Agreement. In the event of any uncertainty as to its duties hereunder, the Escrow Agent may refuse to act under the provisions of this Agreement pending order of a court of competent jurisdiction and the Escrow Agent shall
have no liability to the Company, the Dealer Manager or to any other person as a result of such action. Any such legal action may be brought in such court as the Escrow Agent shall determine to have jurisdiction thereof. The filing of any such legal
proceedings shall not deprive the Escrow Agent of its compensation earned prior to such filing. 
 18. Limited Purpose. The
Company and Dealer Manager hereby acknowledge that the Escrow Agent is serving as the escrow agent only for the limited purposes herein set forth, and hereby agree that they will not represent or imply that the Escrow Agent, by serving as the Escrow
Agent hereunder or otherwise, have investigated the desirability or advisability of investment in the Company or have approved, endorsed or passed upon the merits of the Shares, nor shall they use its name in any manner whatsoever in connection with
the offer or sale of the Shares other than by acknowledgment that the Escrow Agent has agreed to serve as the Escrow Agent for the limited purposes set forth herein. 

 19. Resignation. The Escrow Agent may resign upon 30 days advance written notice to the
Company and the Dealer Manager. Such resignation shall become effective on the date specified in such notice, which shall be not earlier than 30 days after such written notice has been given. In the event of any such resignation, a successor escrow
agent, which shall be a bank or trust company organized under the laws of the United States of America, shall be appointed by the mutual agreement of the Company and the Dealer Manager. Any such successor escrow agent shall deliver to the Company
and the Dealer Manager a written instrument accepting such appointment, and thereupon shall succeed to all the rights and duties of the Escrow Agent hereunder and shall be entitled to receive the Escrow Account from the Escrow Agent. The Escrow
Agent shall promptly pay the Subscription Payments in the Escrow Account, including interest thereon, to the successor escrow agent. If a successor Escrow Agent is not appointed by the Company or the Dealer Manager within the 30-day period following
such notice, the Escrow Agent may petition any court of competent jurisdiction to name a successor Escrow Agent. All costs, expenses and reasonable attorneys’ fees for which the Escrow Agent incurs in connection with such proceeding shall be
paid by the Company. 
 20. Removal. The Escrow Agent may be jointly removed by the Company and the Dealer Manager at any time,
by written notice executed by both of them (which may be executed in counterparts) provided to the Escrow Agent, which instrument shall become effective on the date specified in such written notice. The removal of the Escrow Agent shall not deprive
the Escrow Agent of its compensation earned prior to such removal. In the event of any such removal, a successor escrow agent, which shall be a bank or trust company organized under the laws of the United States of America, shall be appointed by the
mutual agreement of the Company and the Dealer Manager. Any such successor escrow agent shall deliver to the Company and the Dealer Manager a written instrument accepting such appointment, and thereupon shall succeed to all the rights and duties of
the Escrow Agent hereunder and shall be entitled to receive the Escrow Account from the Escrow Agent. The Escrow Agent shall promptly pay the Subscription Payments in the Escrow Account, including interest thereon, to the successor escrow agent. If
a successor escrow agent is not appointed by the Company or the Dealer Manager within the 30-day period following such notice, the Escrow Agent may petition any court of competent jurisdiction to name a successor escrow agent. All costs, expenses
and reasonable attorneys’ fees for which the Escrow Agent incurs in connection with such proceeding shall be paid by the Company. 
 21. Maintenance of Records. The Escrow Agent shall maintain accurate records of all transactions hereunder. Promptly after the termination of this Agreement, and as may from time to time be reasonably requested by the Company
before such termination, the Escrow Agent shall provide the Company with a copy of such records, certified by the Escrow Agent to be a complete and accurate account of all transactions hereunder. The authorized representatives of the Company and the
Dealer Manager shall also have access to the Escrow Agent’s books and records to the extent relating to its duties hereunder, during normal business hours upon reasonable notice to the Escrow Agent, and at the requesting party’s expense.

 [Signatures Appear on Following Page] 

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

			
	 PALADIN REALTY INCOME PROPERTIES, INC.

		
	 By:
	 	 /S/ WHITNEY A. GREAVES

	 Name:
	 	Whitney A. Greaves
	 Title:
	 	Chief Operating Officer
	
	 WELLS FARGO BANK, NATIONAL ASSOCIATION, as Escrow Agent

		
	 By:
	 	 /S/ KRISTI J. BOYCE

	 Name:
	 	Kristi J. Boyce
	 Title:
	 	Vice President
	
	 PALADIN REALTY SECURITIES, LLC

		
	 By:
	 	 /S/ GERALD A. BOUCHER

	 Name:
	 	Gerald A. Boucher
	 Title:
	 	President and Chief Compliance Officer

 EXHIBIT A 
 Escrow Agent 
 SCHEDULE OF FEES 
  

			
	Acceptance Fee:	  	$1,500.00

 Initial Fees as they relate to Wells Fargo Bank acting in the capacity of Escrow Agent – includes creation and
examination of the Escrow Agreement; acceptance of the Escrow appointment; setting up of Escrow Account(s) and accounting records; and coordination of receipt of funds for deposit to the Escrow Account. 
  

					
	 Annual Escrow Agent Administration Fee:
	  	 •        For up to 1,000 Investors -
	  	$5,750.00
		
		  	 •        $2,000 per each additional 1,000 investors.

 For ordinary administration services by Escrow Agent –
includes daily routine account management; investment transactions; cash transaction processing (including wires and check processing); monitoring claim notices pursuant to the agreement; disbursement of the funds in accordance with the agreement;
and mailing of trust account statements to all applicable parties. Includes access to CTSLINK© (secure website for information dissemination to all applicable parties. Includes access to
Trust Portfolio Reporting © for Escrow Account information Assumes Paladin Realty Income Properties, Inc. will provide subscriber data in a mutually agreeable electronic format compatible
with Wells Fargo system (Excel preferred) to include subscriber name(s), address, city, state, zip code, tax ID or SSN number, dollar amount of investment and date of receipt. 
 $7,250 is Payable in advance and due at the time of Escrow Agreement execution. Additional fees will be billed in arrears based on the final number of investors per the above grid. Fee will not be prorated in case of
early termination or numbers of investors less that a total of 1,000 on a minimum or incremental basis. 
  

			
	Tax reporting:	  	$10 per investor when W-9 form is provided to Wells Fargo.
		
		  	$25 per investor when Wells Fargo is responsible for obtaining W-9 form directly from the investor.

 Wells Fargo’s fees are based on the following assumptions: 
  

	•	 	 Number of Escrow Accounts to be established: One (1) 

  

	•	 	 Number of Deposits to Escrow Account: To Be Determined 

  

	•	 	 Number of Withdrawals from Escrow Fund: Not more than Sixty (60) per year 

  

	•	 	 Term of Escrow: Indefinite 

  

	•	 	 This fee schedule assumes that Wells Fargo is able to receive the current investor information and transaction history in a format compatible to the STARs system
(preferably in Excel). If manual entry is required, acceptance fee will be $2,500. 

  

	•	 	 THIS FEE SCHEDULE ASSUMES THAT BALANCES IN THE ESCROW ACCOUNT WILL BE INVESTED IN MONEY MARKET FUNDS THAT WELLS FARGO HAS A RELATIONSHIP WITH

  

	•	 	 ALL FUNDS WILL BE RECEIVED FROM OR DISTRIBUTED TO A DOMESTIC OR AN APPROVED FOREIGN ENTITY 

			
	Out-of Pocket Expenses:	  	At Cost

 We only charge for out-of-pocket expenses in response to specific tasks assigned by the client. Therefore, we
cannot anticipate what specific out-of-pocket items will be needed or what corresponding expenses will be incurred. Possible expenses would be, but are not limited to, express mail and messenger charges, travel expenses to attend closing or other
meetings. There are no charges for indirect out-of- pocket expenses. 

 EXHIBIT B 
 Agency and Custody Account Direction 
 For Cash Balances 
 Wells Fargo Money Market Deposit Accounts 
 Direction
to use the following Wells Fargo Money Market Deposit Accounts for Cash Balances for the escrow account or accounts (the “Account”) established under the Escrow Agreement to which this Exhibit B is attached. 
 You are hereby directed to deposit, as indicated below, or as I shall direct further in writing from time to time, all cash in the Account(s) in
the following money market deposit account of Wells Fargo Bank, National Association (Bank): 
 Wells Fargo Money Market
Deposit Account (MMDA) 
 I understand that amounts on deposit in the MMDA are insured, subject to the applicable rules and regulations of the Federal
Deposit Insurance Corporation (FDIC), in the basic FDIC insurance amount of $100,000 per depositor, per insured bank. This includes principal and accrued interest up to a total of $100,000. I understand that deposits in the MMDA are not secured.

 I acknowledge that I have full power to direct investments of the Account(s). 
 I understand that I may change this direction at any time and that it shall continue in effect until revoked or modified by me by written notice to you. 
  

	
	  

	 Authorized Representative

	
	  

	 Date

 EXHIBIT C-1 
 CERTIFICATE AS TO AUTHORIZED SIGNATURES 
 The specimen signatures shown below are the specimen signatures of the
individuals who have been designated as authorized representatives of Paladin Realty Income Properties, Inc. and are authorized to initiate and approve transactions of all types for the escrow account or accounts established under the Escrow
Agreement to which this Exhibit C-1 is attached, on behalf of Paladin Realty Income Properties, Inc. 
  

					
	 Name / Title
	  	 Specimen Signature
	  	 
			
	  
	  	  
	  	
	 Name
	  	Signature	  	
			
	  
	  		  	
	 Title
	  		  	
			
	  
	  	  
	  	
	 Name
	  	Signature	  	
			
	  
	  		  	
	 Title
	  		  	
			
	  
	  	  
	  	
	 Name
	  	Signature	  	
			
	  
	  		  	
	 Title
	  		  	
			
	  
	  	  
	  	
	 Name
	  	Signature	  	
			
	  
	  		  	
	 Title
	  		  	

 EXHIBIT C-2 
 CERTIFICATE AS TO AUTHORIZED SIGNATURES 
 The specimen signatures shown below are the specimen signatures of the
individuals who have been designated as authorized representatives of Paladin Realty Securities, LLC and are authorized to initiate and approve transactions of all types for the escrow account or accounts established under the Escrow Agreement to
which this Exhibit C-2 is attached, on behalf of Paladin Realty Securities, LLC. 
  

					
	 Name / Title
	  	 Specimen Signature
	  	 
			
	  
	  	  
	  	
	 Name
	  	Signature	  	
			
	  
	  		  	
	 Title
	  		  	
			
	  
	  	  
	  	
	 Name
	  	Signature	  	
			
	  
	  		  	
	 Title
	  		  	
			
	  
	  	  
	  	
	 Name
	  	Signature	  	
			
	  
	  		  	
	 Title
	  		  	
			
	  
	  	  
	  	
	 Name
	  	Signature	  	
			
	  
	  		  	
	 Title

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