Document:

Exhibit 10.3

Exhibit 10.3

EXECUTION VERSION

ASSET MANAGEMENT AGREEMENT

THIS ASSET MANAGEMENT AGREEMENT, dated as of May 2, 2011, is among Corporate Property
Associates 16 — Global Incorporated, a Maryland corporation (the “Company”), CPA 16 LLC, a
Delaware limited liability company (the “Operating LLC”), and W.P. CAREY & Co. B.V., a Netherlands
company (the “Manager”).

W I T N E S S E T H:

WHEREAS, the Company intends to qualify as a REIT (as defined below), and to invest its funds
in investments permitted by the terms of any prospectus pursuant to which it raised equity capital
and Sections 856 through 860 of the Code (as defined below);

WHEREAS, the Company desires to avail itself of the experience, sources of information, and
assistance of, and certain facilities available to, the Manager with respect to disposition
opportunities and asset management, for properties located outside of the United States, and to
have the Manager undertake the duties and responsibilities hereinafter set forth, on behalf of, and
subject to the supervision of the Board of Directors of the Company, all as provided herein; and

WHEREAS, the Manager is willing to render such services, subject to the supervision of the
Board of Directors, on the terms and conditions hereinafter set forth;

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements
contained herein, the parties hereto agree as follows:

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

Acquisition Expense. Acquisition Expense as defined under the Advisory
Agreement.

Acquisition Fee. The Acquisition Fee as defined under the Advisory Agreement.

Adjusted Invested Assets. The average during any period of the aggregate
historical cost, or to the extent available for a particular asset, the most recent
Appraised Value, of the Investments of the Company, before accumulated reserves for
depreciation or bad debt allowances or other similar non-cash reserves, computed (unless
otherwise specified) by taking the average of such values at the end of each month during
such period.

Adjusted Investor Capital. As of any date, the Initial Investor Capital
reduced by any Redemptions, other than Redemptions intended to qualify as a liquidity event
for
purposes of this Agreement, and by any other Distributions on or prior to such date
determined by the Board to be from Cash from Sales and Financings.

 

 

 

Adjusted Net Income. For any period, the total consolidated revenues
recognized in such period, less the total consolidated expenses recognized in such period,
excluding additions to reserves for depreciation and amortization, bad debts or other
similar non-cash reserves, provided, however, that Adjusted Net Income for purposes of
calculating total allowable Operating Expenses shall exclude any gain, losses or writedowns
from the sale of the Company’s assets.

Advisor. The Company’s external advisor. As of the date of this Agreement,
the Advisor is Carey Asset Management Corp.

Advisory Agreement. The Advisory Agreement, dated as of May 2, 2011, among the
Company, the Operating LLC and the Advisor, as the same may be amended, supplemented,
extended and renewed, and any successor advisory agreement.

Affiliate. An Affiliate of another Person shall include any of the following:
(i) any Person directly or indirectly owning, controlling, or holding, with power to vote
ten percent or more of the outstanding voting securities of such other Person; (ii) any
Person ten percent or more of whose outstanding voting securities are directly or indirectly
owned, controlled, or held, with power to vote, by such other Person; (iii) any Person
directly or indirectly controlling, controlled by, or under common control with such other
Person; (iv) any executive officer, director, trustee or general partner of such other
Person; or (v) any legal entity for which such Person acts as an executive officer,
director, trustee or general partner.

Agreement. This Asset Management Agreement.

Appraised Value. Value according to an appraisal made by an Independent
Appraiser, which may take into consideration any factor deemed appropriate by such
Independent Appraiser, including, but not limited to, the terms and conditions of any lease
of the relevant property, the quality of any lessee’s credit and the conditions of the
credit markets. The Appraised Value may be greater than the construction cost or the
replacement cost of the property.

Articles of Incorporation. Articles of Incorporation of the Company under the
General Corporation Law of Maryland, as amended from time to time, pursuant to which the
Company is organized.

Asset Management Fee. The Asset Management Fee as defined in Section 9(a)
hereof.

Average Invested Assets. The average during any period of the aggregate book
value of the assets of the Company’s Investments, before deducting reserves for
depreciation, bad debts, impairments, amortization and all other similar non-cash reserves,
computed by taking the average of such values at the end of each month during such period.

 

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Board or Board of Directors. The Board of Directors of the Company.

Bylaws. The bylaws of the Company, as amended from time to time.

Cash from Financings. Net cash proceeds realized by the Company from the
financing of Investments or the refinancing of any Company indebtedness secured by real
estate located outside the United States.

Cash from Sales. Net cash proceeds realized by the Company from the sale,
exchange or other disposition of any of its assets located outside the United States after
deduction of all expenses incurred in connection therewith. Cash from Sales shall not
include Cash from Financings.

Cash from Sales and Financings. The total sum of Cash from Sales and Cash from
Financings.

Cause. With respect to the termination of this Agreement, fraud, criminal
conduct, willful misconduct or willful or negligent breach of fiduciary duty by the Manager
that, in each case, is determined by a majority of the Independent Directors to be
materially adverse to the Company, or a breach of a material term or condition of this
Agreement by the Manager and the Manager has not cured such breach within 30 days of written
notice thereof or, in the case of any breach that cannot be cured within 30 days by
reasonable effort, has not taken all necessary action within a reasonable time period to
cure such breach.

Closing Date. The first date on which Shares were issued pursuant to an
Offering.

Code. Internal Revenue Code of 1986, as amended.

Company. Corporate Property Associates 16 — Global Incorporated, a corporation
organized under the laws of the State of Maryland.

Competitive Real Estate Commission. The real estate or brokerage commission
paid for the purchase or sale of a property that is reasonable, customary and competitive in
light of the size, type and location of the property.

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

Cumulative Return. For the period for which the calculation is being made, the
percentage resulting from dividing (A) the total Distributions for such period (not
including Distributions out of Cash from Sales and Financings), by (B) the product of (i)
the average Adjusted Investor Capital for such period (calculated on a daily basis), and
(ii) the number of years (including fractions thereof) elapsed during such period.
Notwithstanding the foregoing, neither the Shares received by the Manager or its Affiliates
for any consideration other than cash, nor the Distributions in respect of such Shares,
shall be included in the foregoing calculation.

 

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Directors. The persons holding such office, as of any particular time, under
the Articles of Incorporation, whether they be the directors named therein or additional or
successor directors.

Distributions. Distributions declared by the Board.

GAAP. Generally accepted accounting principles in the United States.

Good Reason. With respect to the termination of this Agreement, (i) any
failure to obtain a satisfactory agreement from any successor to the Company or the
Operating LLC to assume and agree to perform the Company’s and the Operating LLC’s
obligations under this Agreement; or (ii) any material breach of this Agreement of any
nature whatsoever by the Company or the Operating LLC; provided that such breach (a) is of a
material term or condition of this Agreement and (b) the Company or the Operating LLC, as
applicable, has not cured such breach within 30 days of written notice thereof or, in the
case of any breach that cannot be cured within 30 days by reasonable effort, has not taken
all necessary action within a reasonable time period to cure such breach.

Gross Offering Proceeds. The aggregate purchase price of Shares sold in any
Offering.

Independent Appraiser. A qualified appraiser of real estate as determined by
the Board, who has no material current or prior business or personal relationship with, the
Advisor or the Directors and who is engaged to a substantial extent in the business of
rendering opinions regarding the value of real estate related investments. Membership in a
nationally recognized appraisal society such as the American Institute of Real Estate
Appraisers or the Society of Real Estate Appraisers shall be conclusive evidence of such
qualification (but not of independence).

Independent Director. A Director of the Company who meets the criteria for an
Independent Director specified in the Bylaws.

Individual. Any natural person and those organizations treated as natural
persons in Section 542(a) of the Code.

Initial Investor Capital. The total amount of capital invested from time to
time by Shareholders (computed at the Original Issue Price per Share), excluding any Shares
received by the Manager, the Advisor or their respective Affiliates for any consideration
other than cash.

Investment. An investment made by the Company, directly or indirectly, in a Property,
Loan or Other Permitted Investment Asset.

Loan Refinancing Fee. The Loan Refinancing Fee as defined in Section 9(b)
hereof.

 

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Loans. The notes and other evidences of indebtedness or obligations acquired
or entered into by the Company as lender which are secured or collateralized by personal
property, or fee or leasehold interests in real estate or other assets, in each case
located outside the United States, including but not limited to first or subordinate
mortgage loans, construction loans, development loans, loans secured by capital stock or any
other assets or form of equity interest and any other type of loan or financial arrangement,
such as providing or arranging for letters of credit, providing guarantees of obligations to
third parties, or providing commitments for loans. The term “Loans” shall not include
leases, which are not recognized as leases for Federal income tax reporting purposes.

Manager. W.P. Carey & Co. B.V., a company organized under the laws of The
Netherlands.

Market Value. The value calculated by multiplying the total number of
outstanding Shares by the average closing price of the Shares over the 30 trading days
beginning 180 calendar days after the Shares are first listed on a national securities
exchange or included for quotation in an electronic trading system.

Nasdaq. The national automated quotation system operated by the National
Association of Securities Dealers, Inc.

Offering. The offering of Shares pursuant to a Prospectus.

Operating Expenses. All consolidated operating, general and administrative
expenses paid or incurred by the Company, as determined under GAAP, except the following
(insofar as they would otherwise be considered operating, general and administrative
expenses under GAAP): (i) interest and discounts and other cost of borrowed money; (ii)
taxes (including state, Federal and foreign income tax, property taxes and assessments,
franchise taxes and taxes of any other nature); (iii) expenses of raising capital, including
Organization and Offering Expenses, printing, engraving, and other expenses, and taxes
incurred in connection with the issuance and distribution of the Company’s Shares and
Securities; (iv) Acquisition Expenses, real estate commissions on resale of property and
other expenses connected with the acquisition, disposition, origination, ownership and
operation of Investments, including the costs of foreclosure, insurance premiums, legal
services, brokerage and sales commissions, and the maintenance, repair and improvement of
property; (v) Acquisition Fees or Subordinated Disposition Fees payable to the Manager under
this Agreement and the corresponding fees payable to the Manager under the Management
Agreement, or any other party; (vi) distributions paid by the Operating LLC to the Special
General Partner under the agreement of limited partnership of the Operating LLC in respect
of gains realized on dispositions of Investments; (vii) amounts paid to effect a redemption
or repurchase of the special general partner interest held by the Special General Partner
pursuant to the agreement of limited partnership of the Operating LLC; and (viii) non-cash
items, such as depreciation, amortization, depletion, and additions to reserves for
depreciation, amortization, depletion, losses and bad debts. Notwithstanding anything
herein to the contrary, Operating Expenses shall include the Asset Management Fee and any
Loan Refinancing Fee and, solely for the purposes of determining compliance with the 2%/25%
Guidelines, distributions of profits and cash flow made by the Operating LLC to
the Special Member pursuant to the agreement of limited partnership of the Operating
LLC, other than distributions described in clauses (vi) and (vii) of this definition.

 

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Organization and Offering Expenses. Organization and Offering Expenses as
defined under the Advisory Agreement.

Original Issue Price. For any share issued in an Offering, the price at which
such Share was initially offered to the public by the Company, regardless of whether selling
commissions were paid in connection with the purchase of such Shares from the Company.

Other Permitted Investment Asset. An asset, other than cash, cash equivalents,
short term bonds, auction rate securities and similar short term investments, acquired by
the Company for investment purposes that is not a Loan or a Property but that is
attributable to an investment or activities of the Company outside the United States and is
consistent with the investment objectives and policies of the Company.

Person. An Individual, corporation, partnership, joint venture, association,
company, trust, bank, or other entity, or government or any agency or political subdivision
of a government.

Preferred Return. A Cumulative Return of six percent computed from the Closing
Date through the date as of which such amount is being calculated.

Property or Properties. The Company’s partial or entire interest in real
property (including leasehold interests) located outside the United States and personal or
mixed property connected therewith. An investment which obligates the Company to acquire a
Property will be treated as a Property for purposes of this Agreement.

Property Management Fee. A fee for property management services rendered by
the Advisor or its Affiliates in connection with assets of the Company acquired directly or
through foreclosure.

Prospectus. Any prospectus pursuant to which the Company offers Shares in a
public offering, as the same may at any time and from time to time be amended or
supplemented after the effective date of the registration statement in which it is included.

Redemptions. An amount determined by multiplying the number of Shares redeemed
by the Original Issue Price.

REIT. A real estate investment trust, as defined in Sections 856-860 of the
Code.

Securities. Any stock, shares (other than currently outstanding Shares and
subsequently issued Shares), voting trust certificates, bonds, debentures, notes or other
evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise or
in general any instruments commonly known as “securities” or any certificate of interest,
 shares or participation in temporary or interim certificates for receipts (or,
guarantees of, or warrants, options or rights to subscribe to, purchase or acquire any
of the foregoing), which subsequently may be issued by the Company.

 

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Shareholders. Those Persons who at the time any calculation hereunder is to be
made are shown as holders of record of Shares on the books and records of the Company.

Shares. All of the shares of common stock of the Company, $.001 par value, and
any other shares of common stock of the Company.

Special Member. Carey REIT III, Inc. and any transferee of its special
membership interest in the Operating LLC.

Sponsor. W.P. Carey & Co. LLC and any other Person directly or indirectly
instrumental in organizing, wholly or in part, the Company or any person who will control,
manage or participate in the management of the Company, and any Affiliate of any such
person. Sponsor does not include a person whose only relationship to the Company is that of
an independent property manager and whose only compensation is as such. Sponsor also does
not include wholly independent third parties such as attorneys, accountants and underwriters
whose only compensation is for professional services.

Subordinated Acquisition Fee. The Subordinated Acquisition Fee as defined
under the Advisory Agreement.

Subordinated Disposition Fee. The Subordinated Disposition Fee as defined in
Section 9(d) hereof.

Termination Date. The effective date of any termination of this Agreement.

Termination Fee. The Termination Fee as defined under the Advisory Agreement.

Two Percent/25% Guidelines. The requirement, as provided in Section 13 hereof,
that, in any 12-month period ending on the last day of any fiscal quarter, aggregate
Operating Expenses under this Agreement and the Advisory Agreement not exceed the greater of
two percent of the Company’s Average Invested Assets during such 12-month period or 25% of
the Company’s Adjusted Net Income over the same 12-month period.

2. Appointment. The Company hereby appoints the Manager to serve as its manager on
the terms and conditions set forth in this Agreement, and the Manager hereby accepts such
appointment.

3. Duties of the Manager. During the term of this Agreement, the Manager agrees, for
and in consideration of the compensation set forth below, to supervise and direct the management
and operation of the Properties on behalf of the Company and for the account of the Company, in an
efficient and satisfactory manner consistent with like quality properties and at all times maintain
or contract for systems and personnel sufficient to enable it to carry out all of its duties,
obligations and functions under this Agreement. In performance of this undertaking, subject to the
supervision of the Board and consistent with the provisions of the Articles of Incorporation and
Bylaws of the Company and any Prospectus pursuant to which Shares are
offered, the Manager shall, with respect to the Properties, either directly or by engaging an
Affiliate:

(a) demand, collect and receive (i) all rents, utility charges, common area charges, insurance
charges, VAT payments and real estate and personal property tax and assessment charges, (ii) all
other pass-through or bill-back charges, sums, costs or expenses of any nature whatsoever payable
by tenants under the terms of any or all of the leases and any other agreements relating to all or
any portion of the Properties, and (iii) all other revenues, issues and profits accruing from the
Properties and any covenant calculations and insurance certificates;

 

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(b) calculate and administer rent calculations; maintain and review tenant covenant
calculations; calculate and submit lender covenant calculations; and maintain letters of credits
and security deposit information;

(c) serve as primary contact to all tenants, field inquiries and requests; process easements
and landlord lien waivers; manage third party asset managers and coordinate loan closings with
third party asset managers; inspect at-risk properties, oversee inspections by lenders and
third-party property inspection firms, and coordinate site visits and reports; ascertain necessary
repair and monitor deferred maintenance, and ensure tenant compliance; schedule and coordinate
tenant improvement projects and leasing efforts; create expense budgets for vacant properties as
needed and pro forma expense budgets for at-risk properties; assist in executing redevelopment
strategies; provide or source technical expertise when necessary relating to building issues;
formulate, structure and oversee redevelopment projects; and meet with tenants to discuss potential
needs;

(d) assess residual risk and long term viability on all Properties; perform credit analysis of
tenant businesses and economic analysis of holding and selling Properties; maximize returns for the
Company through early renewals or sales of Properties; manage bankruptcy process and monitor credit
quality of portfolios; restructure leases as necessary; execute opportunistic mortgage refinancing;
coordinate with annual third party appraisers in valuation process; and assess and manage market
risks and risks associated with legal, tax, and corporate structure;

(e) supervise the performance of such ministerial and administrative functions as may be
necessary in connection with the daily operations of the Properties, including but not limited to,
overseeing and training for international compliance functions and staffing; overseeing and
ensuring tax, legal, and regulatory compliance; ensuring timely completion of all obligations by
tenants; and ensuring smooth integration of new investments into asset management platform;

(f) from time to time, or at any time reasonably requested by the Board or management of the
Company, make reports of its performance of services to the Company under this Agreement, including
the State of the Assets and bi weekly status reports to be provided to the Company’s management;

 

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(g) provide the Company with such accounting data and any other information requested by the
Company concerning the investment activities of the Company as shall be required to prepare and to
file all periodic financial reports and returns required to be filed with the Securities and
Exchange Commission and any other regulatory agency, including annual financial statements;

(h) perform corporate secretarial work including, but not limited to, tracking of dates of
required filings and annual general meetings for subsidiaries of the Company; obtaining and
coordinating all relevant materials needed for audit and/or statutory filing, including approvals
of financial information, auditor’s representation letters, and minutes and resolutions; preparing
financial analyses of recurring payments; maintaining information for compliance reports;
organizing, planning, and presenting International State of the Assets meetings; and preparing
International Asset Operating Committee Memos;

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

(j) obtain for, or provide to, the Company such services as may be required in disposing of
Investments;

Notwithstanding anything to the contrary in this Agreement, the Company acknowledges that the
Manager does not have an office in the United States and intends to conduct its business in a
manner that will not cause Manager to be deemed to be engaged in a United States trade or business
or have a permanent establishment in the United States.

4. Authority of Manager.

(a) Pursuant to the terms of this Agreement (and subject to the restrictions included in
Paragraphs (b) of this Section 4 and in Section 7 hereof), and subject to the continuing and
exclusive authority of the Board over the management of the Company, the Board hereby delegates to
the Manager the authority to: (1) arrange for refinancing, or assess changes in the asset or
capital structure of, and dispose of or otherwise deal with, Properties; (2) enter into leases and
service contracts for Properties, and perform other property level operations; (3) oversee
non-affiliated property managers and other non-affiliated Persons who perform services for the
Company; (4) undertake accounting and other record-keeping functions at the Property level; and (5)
perform its duties set forth in Section 3.

(b) The Manager shall be authorized to perform the services contemplated by this Agreement
with respect to Investments other than Properties and Loans; provided, however, that if fees for
such services will be different from the fees contemplated by Section 9 of this Agreement, such
fees shall be approved in advance by a majority of the Independent Directors.

(c) The prior approval of the Board, including a majority of the Independent Directors and a
majority of the Directors not interested in the transaction will be required for: (i) transactions
that present issues which involve conflicts of interest for the Manager or an Affiliate (other than
conflicts involving the payment of fees or the reimbursement of expenses); (ii) the lease of assets
to the Sponsor, any Director, the Manager or any Affiliate of the Manager; (iii) any purchase or
sale of an Investment from or to the Manager or an Affiliate; and (iv) the
retention of any Affiliate of the Manager to provide services to the Company not expressly
contemplated by this Agreement and the terms of such services by such Affiliate. In addition, the
Manager shall comply with any further approval requirements set forth in the Bylaws.

 

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(d) The Board may, at any time upon the giving of notice to the Manager, modify or revoke the
authority set forth in this Section 4. If and to the extent the Board so modifies or revokes the
authority contained herein, the Manager shall henceforth comply with such modification or
revocation, provided however, that such modification or revocation shall be effective upon receipt
by the Manager and shall not be applicable to transactions to which the Manager has committed the
Company prior to the date of receipt by the Manager of such notification.

5. Bank Accounts. The Manager may establish and maintain one or more bank accounts in
its own name. The Manager may establish and maintain one or more bank accounts for the account of
the Company or in the name of the Company and may collect and deposit into any such account or
accounts, and disburse from any such account or accounts, any money on behalf of the Company,
provided that no funds shall be commingled with the funds of the Manager; and the Manager shall
from time to time render appropriate accountings of such collections and payments to the Board and
to the auditors of the Company.

6. Records; Access. The Manager shall maintain appropriate records of all its
activities hereunder and make such records available for inspection by the Board and by counsel,
auditors and authorized agents of the Company, at any time or from time to time during normal
business hours. The Manager shall at all reasonable times have access to the books and records of
the Company.

7. Limitations on Activities. Anything else in this Agreement to the contrary
notwithstanding, the Manager shall refrain from taking any action which, in its sole judgment made
in good faith, would adversely affect the status of the Company as a REIT, subject the Company to
regulation under the Investment Company Act of 1940, violate any law, rule, regulation or statement
of policy of any governmental body or agency having jurisdiction over the Company, its Shares or
its Securities, or otherwise not be permitted by the Articles of Incorporation or Bylaws, except if
such action shall be ordered by the Board, in which case the Manager shall notify promptly the
Board of the Manager’s judgment of the potential impact of such action and shall refrain from
taking such action until it receives further clarification or instructions from the Board. In such
event the Manager shall have no liability for acting in accordance with the specific instructions
of the Board so given. Notwithstanding the foregoing, the Manager, its shareholders, directors,
officers and employees, and partners, shareholders, directors and officers of the Manager’s
partners and Affiliates of any of them, shall not be liable to the Company, or to the Directors or
Shareholders for any act or omission by the Manager, its partners, directors, officers and
employees, or partners, shareholders, directors or officers of the Manager’s partners except as
provided in Sections 20 and 22 hereof.

8. Relationship with Directors. There shall be no limitation on any shareholder,
director, officer, employee or Affiliate of the Manager serving as a Director or an officer of the
Company, except that no employee of the Manager or its Affiliates who also is a Director or officer
of the Company shall receive any compensation from the Company for serving as a
Director or officer other than for reasonable reimbursement for travel and related expenses
incurred in attending meetings of the Board; for the avoidance of doubt, the limitations of this
Section 8 shall not apply to any compensation paid by the Manager or any Affiliate for which the
Company reimbursed the Manager or Affiliate in accordance with Section 10 hereof.

 

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9. Fees.

(a) Asset Management Fee. The Operating LLC shall pay to the Manager as compensation
for the services rendered to the Company hereunder an amount equal to 0.50% percent per annum of
the Adjusted Invested Assets of the Company (the “Asset Management Fee”) calculated as set
forth below. The Asset Management Fee will be calculated monthly on the basis of one-twelfth of
one percent of the Adjusted Invested Assets for that month, computed as a daily average. The Asset
Management Fee shall be prorated for the number of days during the month that the Company owns an
Investment.

(b) Loan Refinancing Fee. The Company shall pay to the Manager for all qualifying
loan refinancings of Properties a loan refinancing fee in the amount up to one percent of the
principal amount of the refinanced loan (the “Loan Refinancing Fee”). Any Loan Refinancing
Fee shall be due and payable upon the funding of the related loan or as soon thereafter as is
reasonably practicable. A refinancing will qualify for a Loan Refinancing Fee only if the
refinanced loan is secured by Property and (i) the maturity date of the refinanced loan (which must
have a term of five years or more) is less than one year from the date of the refinancing; or (ii)
the terms of the new loan represent, in the judgment of a majority of the Independent Directors, an
improvement over the terms of the refinanced loan; or (iii) the new loan is approved by the Board,
including a majority of the Independent Directors and, in each case, the Loan Refinancing Fee is
found, in the judgment of a majority of the Independent Directors, to be in the best interest of
the Company.

(c) Property Management Fee. No Property Management Fee shall be paid unless approved
by a majority of the Independent Directors.

(d) Subordinated Disposition Fee. If the Manager provides a substantial amount of
services in the sale of a Property or Loan, the Manager shall receive a fee equal to the lesser of:
(i) 50% of the Competitive Real Estate Commission and (ii) three percent of the Contract Sales
Price of such Property (the “Subordinated Disposition Fee”). The Subordinated Disposition
Fee will be paid only if Shareholders have received in the aggregate a return of 100% of Initial
Investor Capital (through liquidity or Distributions) plus a Preferred Return through the end of
the fiscal quarter immediately preceding the date the Subordination Disposition Fee is paid. The
return requirement will be deemed satisfied if the total Distributions paid by the Company have
satisfied the Preferred Return requirement and the Market Value of the Company equals or exceeds
Adjusted Investor Capital. To the extent that Subordinated Disposition Fees are not paid by the
Company on a current basis due to the foregoing limitation, the unpaid fees will be due and paid at
such time as the limitation has been satisfied. The Subordinated Disposition Fee may be paid in
addition to real estate commissions paid to non-Affiliates, provided that the total of all real
estate commissions in respect of a Property paid to all Persons by the Company and the Subordinated
Disposition Fee shall not exceed an amount equal to the lesser of: (i) six percent of the Contract
Sales

 

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Price of such Property or (ii) the
Competitive Real Estate Commission. The Manager shall present to the Independent Directors
such information as they may reasonably request to review the level of services provided by the
Manager in connection with a disposition and the basis for the calculation of the amount of the
accrued Subordinated Disposition Fees on an annual basis. The amount of any accrued Subordinated
Disposition Fee shall be deemed conclusively established once it has been approved by the
Independent Directors, absent a subsequent finding of error. No payment of Subordinated Disposition
Fees shall be made prior to review and approval of such information by the Independent Directors.
If this Agreement is terminated prior to such time as the Shareholders have received (through
liquidity or Distributions) a return of 100% of Initial Investor Capital plus a Preferred Return
through the date of termination of this Agreement, an appraisal of the Properties then owned by the
Company shall be made and any unpaid Subordinated Disposition Fee on Properties sold prior to the
date of termination will be payable if the Appraised Value of the Properties then owned by the
Company plus Distributions to Shareholders prior to the date of termination of this Agreement
(through liquidity or Distributions) is equal to or greater than 100% of Initial Investor Capital
plus an amount sufficient to pay a Preferred Return through the date of termination of this
Agreement. If the Company’s Shares are listed on a national securities exchange or included for
quotation in an electronic trading system and, at the time of such listing, the Manager has
provided a substantial amount of services in the sale of Property, for purposes of determining
whether the subordination conditions for the payment of the Subordinated Disposition Fee have been
satisfied, Shareholders will be deemed to have received a Distribution in an amount equal to the
Market Value of the Company.

(e) Loans From Affiliates. The Company shall not borrow funds from the Manager or its
Affiliates unless (A) the transaction is approved by a majority of the Independent Directors and a
majority of the Directors who are not interested in the transaction as being fair, competitive and
commercially reasonable, (B) the interest and other financing charges or fees received by the
Manager or its Affiliates do not exceed the amount which would be charged by non-affiliated lending
institutions and (C) the terms are not less favorable than those prevailing for comparable
arm’s-length loans for the same purpose. The Company will not borrow on a long-term basis from the
Manager or its Affiliates unless it is to provide the debt portion of a particular investment and
the Company is unable to obtain a permanent loan at that time or in the judgment of the Board, it
is not in the Company’s best interest to obtain a permanent loan at the interest rates then
prevailing and the Board has reason to believe that the Company will be able to obtain a permanent
loan on or prior to the end of the loan term provided by the Manager or its Affiliates.

(f) Changes To Fee Structure. In the event the Shares are listed on a national
securities exchange or are included for quotation on Nasdaq, the Company and the Manager shall
negotiate in good faith to establish a fee structure appropriate for an entity with a perpetual
life. A majority of the Independent Directors must approve the new fee structure negotiated with
the Manager. In negotiating a new fee structure, the Independent Directors may consider any of the
factors they deem relevant, including but not limited to: (a) the size of the Asset Management Fee
in relation to the size, composition and profitability of the Company’s portfolio; (b) the rates
charged to other REITs and to investors other than REITs by Managers performing similar services;
(c) additional revenues realized by the Manager and its Affiliates through their relationship with
the Company, including loan administration, underwriting or broker
commissions, servicing, engineering, inspection and other fees, whether paid by the Company or
by others with whom the Company does business; (d) the quality and extent of service furnished by
the Manager; (e) the performance of the investment portfolio of the Company, including income,
conversion or appreciation of capital, frequency of problem investments and competence in dealing
with distress situations and (f) the quality of the portfolio of the Company in relationship to the
portfolio of real properties owned and managed by W.P. Carey & Co. LLC for its own account. The
new fee structure can be no more favorable to the Manager than the current fee structure. The
Independent Directors shall not approve any new fee structure that is in their judgment more
favorable (taken as a whole) to the Manager than the current fee structure.

 

- 12 -

 

(g) Payment. Compensation payable pursuant to this Section 9 shall be paid directly
to the Manager; provided, however, that any fee payable pursuant to Section 9 may
be paid, at the option of the Manager, in the form of: (i) cash, (ii) common stock of the Company,
or (iii) a combination of cash and common stock. The Manager shall notify the Company in writing
annually of the form in which the fee shall be paid. Such notice shall be provided no later than
December 31 of the year prior to the year to which such election applies. If no such notice is
provided, the fee shall be paid in cash. For purposes of the payment of compensation to the
Manager in the form of stock, the value of each share of common stock shall be: (i) the Net Asset
Value per Share as determined by the most recent appraisal of the Company’s assets performed by an
Independent Appraiser, or (ii) if an appraisal has not yet been performed, $10 per share. If
shares are being offered to the public at the time a fee is paid with stock, the value shall be the
price of the stock without commissions. The Net Asset Value determined on the basis of such
appraisal may be adjusted on a quarterly basis by the Board to account for significant capital
transactions.

10. Expenses. To the extent applicable, in addition to the compensation paid to the
Manager pursuant to Section 9 hereof, the Operating LLC shall pay directly or reimburse the Manager
for the following expenses:

(i) interest and other costs for borrowed money, including discounts, points and other
similar fees;

(ii) taxes and assessments on income of the Company, to the extent paid or advanced by
the Manager, or on Property and taxes as an expense of doing business, in each case
attributable to Properties or non-United States activities;

(iii) expenses of managing and operating Properties, whether payable to an Affiliate of
the Manager or a non-affiliated Person;

(iv) fees and expenses of legal counsel for the Company attributable to Properties;

(v) fees and expense of auditors and accountants for the Company attributable to
Properties;

 

- 13 -

 

(vi) expenses related to the Properties and other fees relating to disposing of
investments including personnel and other costs incurred in transactions relating to
Properties where a fee is not payable to the Manager; and

(vii) all other expenses the Manager incurs in connection with providing services to
the Company hereunder including reimbursement to the Manager or its Affiliates for the cost
of rent, goods, materials and personnel incurred by them based upon the compensation of the
Persons involved and an appropriate share of overhead allocable to those Persons as
reasonably determined by the Manager on a basis approved annually by the Board (including a
majority of the Independent Directors).

No reimbursement shall be made for the cost of personnel to the extent that such personnel are used
in transactions for which the Manager receives a separate fee.

Expenses incurred by the Manager on behalf of the Company and payable pursuant to this Section 10
shall be reimbursed quarterly to the Manager within 60 days after the end of each quarter, subject
to the provisions of Section 13 hereof. The Manager shall prepare a statement documenting the
Operating Expenses of the Company within 45 days after the end of each quarter.

11. Other Services. Should the Board request that the Manager or any partner or
employee thereof render services for the Company other than as set forth in Section 3 hereof, such
services shall be separately compensated and shall not be deemed to be services pursuant to the
terms of this Agreement.

12. Fidelity Bond. The Manager shall maintain a fidelity bond for the benefit of the
Company which bond shall insure the Company from losses of up to $5,000,000 and shall be of the
type customarily purchased by entities performing services similar to those provided to the Company
by the Manager.

13. Limitation on Expenses.

(a) If the aggregate Operating Expenses of the Company under this Agreement and the Advisory
Agreement during the 12-month period ending on the last day of any fiscal quarter of the Company
exceed the greater of (i) two percent of the Average Invested Assets during the same 12-month
period or (ii) 25% of the Adjusted Net Income of the Company during the same 12-month period, then
subject to paragraph (b) of this Section 13, such excess amount shall be the sole responsibility of
the Manager and the Company shall not be liable for payment therefor.

(b) Notwithstanding the foregoing, to the extent that the Manager becomes responsible for any
such excess amount as provided in paragraph (a), if a majority of the Independent Directors finds
such excess amount or a portion thereof justified based on such unusual and non-recurring factors
as they deem sufficient, the Company shall reimburse the Manager in future quarters for the full
amount of such excess, or any portion thereof, but only to the extent such reimbursement would not
cause the Company’s Operating Expenses to exceed the Two Percent/25% Guidelines in the 12-month
period ending on any such quarter. In no
event shall the Operating Expenses paid by the Company in any 12-month period ending at the
end of a fiscal quarter exceed the Two Percent/25% Guidelines.

 

- 14 -

 

(c) Within 60 days after the end of any twelve-month period referred to in paragraph (a), the
Manager shall reimburse the Company for any amounts expended by the Company in such twelve-month
period that exceeds the limitations provided in paragraph (a) unless the Independent Directors
determine that such excess expenses are justified, as provided in paragraph (b), and provided the
aggregate Operating Expenses under this Agreement and the Advisory Agreement for such later quarter
would not thereby exceed the Two Percent/25% Guidelines. To the extent the Company is reimbursed
for such excess expenses by the Advisor, the Company shall not also be entitled to reimbursement
for such excess from the Manager.

(d) All computations made under paragraphs (a) and (b) of this Section 13 shall be determined
in accordance with GAAP applied on a consistent basis.

14. Other Activities of the Manager. Nothing herein contained shall prevent the
Manager from engaging in other activities, including without limitation direct investment by the
Manager and its Affiliates in assets that would be suitable for the Company, the rendering of
services to other investors (including other REITs) and the management of other programs advised,
sponsored or organized by the Manager or its Affiliates; nor shall this Agreement limit or restrict
the right of the Manager or any of its Affiliates or of any director, officer, employee, partner or
shareholder of the Manager or its Affiliates to engage in any other business or to render services
of any kind to any other partnership, corporation, firm, individual, trust or association. The
Manager may, with respect to any investment in which the Company is a participant, also render
service to each other participant therein. Without limiting the generality of the foregoing, the
Company acknowledges that the Manager provides or will provide services to other “Corporate
Property Associates” or CPA® REIT funds, whether now in existence or formed hereafter, and that the
Manager and its Affiliates may invest for their own account. The Manager shall be responsible for
promptly reporting to the Board the existence of any actual or potential conflict of interest that
arises that may affect its performance of its duties under this Agreement.

Neither the Manager nor any Affiliate of the Manager shall be obligated generally to present any
particular investment opportunity to the Company even if the opportunity is of a character which,
if presented to the Company, could be taken by the Company.

15. Relationship of Manager and Company. The Company and the Manager agree that they
have not created and do not intend to create by this Agreement a joint venture or partnership
relationship between them and nothing in this Agreement shall be construed to make them partners or
joint venturers or impose any liability as partners or joint venturers on either of them.

16. Term; Termination of Agreement. This Agreement shall continue in force until
September 30, 2011 and thereafter shall be automatically renewed for successive one year periods
unless either party shall give notice in writing of non renewal to the other party not less than 60
days before the end of any such year.

 

- 15 -

 

17. Termination by Company. At the sole option the Board (including a majority of the
Independent Directors), this Agreement may be terminated immediately by written notice of
termination from the Company to the Manager upon the occurrence of events which would constitute
Cause or if any of the following events occur:

(a) If the Manager shall be adjudged bankrupt or insolvent by a court of competent
jurisdiction, or an order shall be made by a court of competent jurisdiction for the
appointment of a receiver, liquidator, or trustee of the Manager, for all or substantially
all of its property by reason of the foregoing, or if a court of competent jurisdiction
approves any petition filed against the Manager for reorganization, and such adjudication or
order shall remain in force or unstayed for a period of 30 days; or

(b) If the Manager shall institute proceedings for voluntary bankruptcy or shall file a
petition seeking reorganization under the federal bankruptcy laws, or for relief under any
law for relief of debtors, or shall consent to the appointment of a receiver for itself or
for all or substantially all of its property, or shall make a general assignment for the
benefit of its creditors, or shall admit in writing its inability to pay its debts,
generally, as they become due.

Any notice of termination under Section 16 or 17 shall be effective on the date specified in
such notice, which may be the day on which such notice is given or any date thereafter. The
Manager agrees that if any of the events specified in Section 17(a) or (b) shall occur, it shall
give written notice thereof to the Board within 15 days after the occurrence of such event.

18. Termination by Either Party. This Agreement may be terminated immediately without
penalty (but subject to the requirements of Section 20 hereof) by the Manager by written notice of
termination to the Company upon the occurrence of events which would constitute Good Reason or by
the Company without cause or penalty (but subject to the requirements of Section 20 hereof) by
action of a majority of the Independent Directors or by action of a majority of the Shareholders,
in either case upon 60 days’ written notice.

19. Assignment Prohibition. This Agreement may not be assigned by the Manager without
the approval of the Board (including a majority of the Independent Directors); provided, however,
that such approval shall not be required in the case of an assignment to a corporation,
partnership, association, trust or organization which may take over the assets and carry on the
affairs of the Manager, provided: (i) that at the time of such assignment, such successor
organization shall be owned substantially by an entity directly or indirectly controlled by the
Sponsor and only if such entity has a net worth of at least $5,000,000, and (ii) that the board of
directors of the Manager shall deliver to the Board a statement in writing indicating the ownership
structure and net worth of the successor organization and a certification from the new Manager as
to its net worth. Such an assignment shall bind the assignees hereunder in the same manner as the
Manager is bound by this Agreement. The Manager may assign any rights to receive fees or other
payments under this Agreement without obtaining the approval of the Board. This Agreement shall
not be assigned by the Company without the consent of the Manager, except in the case of an
assignment by the Company to a corporation or other organization which is a successor to the
Company, in which case such successor organization
shall be bound hereunder and by the terms of said assignment in the same manner as the Company
is bound by this Agreement.

 

- 16 -

 

20. Payments to and Duties of Manager Upon Termination.

(a) After the Termination Date, the Manager shall not be entitled to compensation for further
services hereunder but shall be entitled to receive from the Company the following:

(i) all unpaid reimbursements of Operating Expenses payable to the Manager;

(ii) all earned but unpaid Asset Management Fees payable to the Manager prior to the
Termination Date;

(iii) all earned but unpaid Subordinated Disposition Fees payable to the Manager
relating to the sale of any Property prior to the Termination Date; and

(iv) all earned but unpaid Loan Refinancing Fees.

Notwithstanding the foregoing, if this Agreement is terminated by the Company for Cause, or by the
Manager for other than Good Reason, the Manager will not be entitled to receive the sums in Section
20(a) above.

(b) Any and all amounts payable to the Manager pursuant to Section 20(a) and Section 20(c)
that, irrespective of the termination, were payable on a current basis prior to the Termination
Date either because they were not subordinated or all conditions to their payment had been
satisfied, shall be paid within 90 days after the Termination Date. All other amounts payable to
the Manager pursuant to Section 20(a) and Section 20(c) shall be paid in a manner determined by the
Board, but in no event on terms less favorable to the Manager than those represented by a note (i)
maturing upon the liquidation of the Company or three years from the Termination Date, whichever is
earlier, (ii) with no less than twelve equal quarterly installments and (iii) bearing a fair,
competitive and commercially reasonable interest rate (the “Note”). The Note, if any, may
be prepaid by the Company at any time prior to maturity with accrued interest to the date of
payment but without premium or penalty. Notwithstanding the foregoing, any amounts that relate to
Investments (i) shall be an amount which provides compensation to the Manager only for that portion
of the holding period for the respective Investments during which the Manager provided services to
the Company, (ii) shall not be due and payable until the Investment to which such amount relates is
sold or refinanced, and (iii) shall not bear interest until the Investment to which such amount
relates is sold or refinanced. A portion of the amount shall be paid as each Investment owned by
the Company on the Termination Date is sold. The portion of such amount payable upon each such
sale shall be equal to (i) such amount multiplied by (ii) the percentage calculated by dividing the
fair value (at the Termination Date) of the Investment sold by the Company divided by the total
fair value (at the Termination Date) of all Investments owned by the Company on the Termination
Date.

 

- 17 -

 

(c) The Manager shall promptly upon termination:

(i) pay over to the Company all money collected and held for the account of the Company
pursuant to this Agreement, after deducting any accrued compensation and reimbursement for
its expenses to which it is then entitled;

(ii) deliver to the Board a full accounting, including a statement showing all payments
collected by it and a statement of all money held by it, covering the period following the
date of the last accounting furnished to the Board;

(iii) deliver to the Board all assets, including Properties, and documents of the
Company then in the custody of the Manager; and

(iv) cooperate with the Company to provide an orderly management transition.

21. Indemnification by the Company.

(a) The Company shall not indemnify the Manager or any of its Affiliates for any loss or
liability suffered by the Manager or the Affiliate, or hold the Manager or the Affiliate harmless
for any loss or liability suffered by the Company, unless all of the following conditions are met:

(i) The Manager or Affiliate has determined, in good faith, that the course of conduct
which caused the loss or liability was in the best interests of the Company;

(ii) The Manager or the Affiliate was acting on behalf of or performing services for
the Company; and

(iii) Such liability or loss was not the result of negligence or misconduct by the
Manager or the Affiliate.

(b) Notwithstanding the foregoing, the Manager and its Affiliates shall not be indemnified by
the Company for any losses, liabilities or expenses arising from or out of the alleged violation of
federal or state securities laws unless one or more of the following conditions are met:

(i) There has been a successful adjudication on the merits of each count involving
alleged securities law violations as to the particular indemnitee;

(ii) Such claims have been dismissed with prejudice on the merits by a court of
competent jurisdiction as to the particular indemnitee; or

(iii) A court of competent jurisdiction approves a settlement of the claims against a
particular indemnitee and finds that indemnification of the settlement and the related costs
should be made, and the court considering the request for indemnification has been advised
of the position of the Securities and Exchange
Commission and of the published position of any state securities regulatory authority
in which securities of the Company were offered or sold as to indemnification for violation
of securities laws.

 

- 18 -

 

(c) The Company shall advance funds to the Manager or its Affiliates for legal expenses and
other costs incurred as a result of any legal action for which indemnification is being sought only
if all of the following conditions are satisfied:

(i) The legal action relates to acts or omissions with respect to the performance of
duties or services on behalf of the Company;

(ii) The legal action is initiated by a third party who is not a Shareholder or the
legal action is initiated by a Shareholder acting in his or her capacity as such and a court
of competent jurisdiction specifically approves such advancement; and

(iii) The Manager or the Affiliate undertakes to repay the advanced funds to the
Company, together with the applicable legal rate of interest thereon, in cases in which such
Manager or Affiliate is found not to be entitled to indemnification.

(d) Notwithstanding the foregoing, the Manager shall not be entitled to indemnification or be
held harmless pursuant to this Section 21 for any activity which the Manager shall be required to
indemnify or hold harmless the Company pursuant to Section 22.

(e) Any amounts paid pursuant to this Section 21 shall be recoverable or paid only out the net
assets of the Company and not from Shareholders.

22. Indemnification by Manager. The Manager shall indemnify and hold harmless the
Company from liability, claims, damages, taxes or losses and related expenses including attorneys’
fees, to the extent that such liability, claims, damages, taxes or losses and related expenses are
not fully reimbursed by insurance and are incurred by reason of the Manager’s bad faith, fraud,
willful misfeasance, misconduct, negligence or reckless disregard of its duties.

23. Notices. Any notice, report or other communication required or permitted to be
given hereunder shall be in writing unless some other method of giving such notice, report or other
communication is accepted by the party to whom it is given, and shall be given by being delivered
by hand or by overnight mail or other overnight delivery service to the addresses set forth herein:

	 	 	 	 	 
	 

	 	To the Board, the Operating LLC or

	 	Corporate Property Associates 16 -
Global Incorporated
	 

	 	the Company:	 	50 Rockefeller Plaza
	 

	 	 	 	New York, NY 10020
	 
	 

	 	To the Manager:
	 	W.P. Carey & Co. B.V.
	 

	 	 	 	Strawinskylaan 741
	 

	 	 	 	Tower C, Level 7
	 

	 	 	 	1077 XX Amsterdam
	 

	 	 	 	The Netherlands

 

- 19 -

 

Either party may at any time give notice in writing to the other party of a change in its
address for the purposes of this Section 23.

24. Modification. This Agreement shall not be changed, modified, terminated, or
discharged, in whole or in part, except by an instrument in writing signed by both parties hereto,
or their respective successors or assignees.

25. Severability. The provisions of this Agreement are independent of and severable
from each other, and no provision shall be affected or rendered invalid or unenforceable by virtue
of the fact that for any reason any other or others of them may be invalid or unenforceable in
whole or in part.

26. Construction. This Agreement shall be governed by, construed and enforced in
accordance with the laws of the State of New York.

27. Entire Agreement. This Agreement contains the entire agreement and understanding
among the parties hereto with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements, understandings, inducements and conditions, express or implied, oral or
written, of any nature whatsoever with respect to the subject matter hereof. The express terms
hereof control and supersede any course of performance and/or usage of the trade inconsistent with
any of the terms hereof. This Agreement may not be modified or amended other than by an agreement
in writing.

28. Indulgences, Not Waivers. Neither the failure nor any delay on the part of a
party to exercise any right, remedy, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege
preclude any other or further exercise of the same or of any other right, remedy, power or
privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any
other occurrence. No waiver shall be effective unless it is in writing and is signed by the party
asserted to have granted such waiver.

29. Gender. Words used herein regardless of the number and gender specifically used,
shall be deemed and construed to include any other number, singular or plural, and any other
gender, masculine, feminine or neuter, as the context requires.

30. Titles Not to Affect Interpretation. The titles of Sections and subsections
contained in this Agreement are for convenience only, and they neither form a part of this
Agreement nor are they to be used in the construction or interpretation hereof.

 

- 20 -

 

31. Execution in Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original as against any party whose
signature appears thereon, and all of which shall together constitute one and the same
instrument. This Agreement shall become binding when one or more counterparts hereof, individually
or taken together, shall bear the signatures of all of the parties reflected hereon as the
signatories.

32. Name. W.P. Carey & Co. LLC has a proprietary interest in the name “Corporate
Property Associates” and “CPA®.” Accordingly, and in recognition of this right, if at any time the
Company ceases to retain W.P. Carey & Co. B.V., or an Affiliate thereof to perform the services of
Manager, the Company will, promptly after receipt of written request from W.P. Carey & Co. B.V.,
cease to conduct business under or use the name “Corporate Property Associates” or “CPA®” or any
diminutive thereof and the Company shall use its best efforts to change the name of the Company to
a name that does not contain the name “Corporate Property Associates” or “CPA®” or any other word
or words that might, in the sole discretion of the Manager, be susceptible of indication of some
form of relationship between the Company and the Manager or any Affiliate thereof. Consistent with
the foregoing, it is specifically recognized that the Manager or one or more of its Affiliates has
in the past and may in the future organize, sponsor or otherwise permit to exist other investment
vehicles (including vehicles for investment in real estate) and financial and service organizations
having “Corporate Property Associates” or “CPA®” as a part of their name, all without the need for
any consent (and without the right to object thereto) by the Company or its Directors.

 

- 21 -

 

IN WITNESS WHEREOF, the parties hereto have executed this Asset Management Agreement as of the
day and year first above written.

	 	 	 	 	 	 	 
	 	 	CORPORATE PROPERTY ASSOCIATES 16- GLOBAL INCORPORATED	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mark J. DeCesaris
 

Name: Mark J. DeCesaris
	 	 
	 

	 	 	 	Title: Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 	 	CPA 16 LLC	 	 
	 
	 	 	 	 	 	 
	 	 	By: CORPORATE PROPERTY ASSOCIATES 16- GLOBAL	 	 
	 	 	INCORPORATED, its managing member	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Trevor P. Bond
 

Name: Trevor P. Bond
	 	 
	 

	 	 	 	Title: Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 	 	W.P. CAREY & CO. B.V.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Greg Butchart
 

Name: Greg Butchart
	 	 
	 

	 	 	 	Title: Executive Directorexv10w1

Exhibit 10.1

SECOND AMENDED AND RESTATED CHANGE IN CONTROL AGREEMENT

     This SECOND AMENDED AND RESTATED CHANGE IN CONTROL AGREEMENT (the “Agreement”), is
made as of August 5, 2011 (the “Effective Date”) by and between Anthera Pharmaceuticals,
Inc. (the “Company”) and Colin Hislop (the “Executive”).

     WHEREAS, the Company and the Executive entered into the Amended and Restated Change in Control
Agreement, dated as of October 15, 2009 (the “Prior Agreement”); and

     WHEREAS, the Company and the Executive desire to amend and restate, in its entirety, the Prior
Agreement, effective as of the Effective Date and in accordance with the terms hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth
and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Executive hereby amend and restate, in its entirety, the Prior
Agreement, effective as of the Effective Date, and agree as follows:

     1. “Change in Control” means the occurrence, in a single transaction or in a series of
related transactions, of any one or more of the following events:

          (a) any Exchange Act Person becomes the Owner, directly or indirectly, of securities of the
Company representing more than fifty percent (50%) of the combined voting power of the Company’s
then outstanding securities other than by virtue of a merger, consolidation or similar transaction;

          (i) for purposes of this Agreement, “Exchange Act Person” means any natural
person, entity or “group” (within the meaning of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended), except that “Exchange Act Person” shall not include (A)
the Company or any subsidiary of the Company, (B) any employee benefit plan of the Company
or any subsidiary of the Company or any trustee or other fiduciary holding securities under
an employee benefit plan of the Company or any subsidiary of the Company, (C) an underwriter
temporarily holding securities pursuant to an offering of such securities, or (D) an entity
owned, directly or indirectly, by the stockholders of the Company in substantially the same
proportion as their ownership of stock of the Company.

          (b) there is consummated a merger, consolidation or similar transaction involving (directly or
indirectly) the Company if, immediately after the consummation of such merger, consolidation or
similar transaction, the stockholders of the Company immediately prior thereto do not own, directly
or indirectly, either (A) outstanding voting securities representing more than fifty percent (50%)
of the combined outstanding voting power of the surviving entity in such merger, consolidation or
similar transaction or (B) more than fifty percent (50%) of the combined outstanding voting power
of the parent of the surviving Entity in such merger, consolidation or similar transaction;

 

          (c) there is consummated a sale, lease, license or other disposition of all or substantially
all of the consolidated assets of the Company and its subsidiaries, other than a sale, lease,
license or other disposition of all or substantially all of the consolidated assets of the Company
and its subsidiaries to an entity, more than fifty percent (50%) of the combined voting power of
the voting securities of which are owned by stockholders of the Company in substantially the same
proportion as their ownership of the Company immediately prior to such sale, lease, license or
other disposition.

     The term Change in Control shall not include a sale of assets, merger or other transaction
effected exclusively for the purpose of changing the domicile of the Company.

     Notwithstanding the foregoing, a transaction shall not constitute a Change in Control if: (i)
its sole purpose is to change the state of the Company’s incorporation; (ii) its sole purpose is to
create a holding company that will be owned in substantially the same proportions by the persons
who held the Company’s securities immediately before such transaction; (iii) it constitutes the
Company’s initial public offering of its securities; or (iv) it is a transaction effected primarily
for the purpose of financing the Company with cash (as determined by the Board in its discretion).

     2. Termination Following Change in Control.

          (a) If the Executive’s employment with the Company is terminated by the Company for any reason
other than for Cause or if there is a Constructive Termination, in each case, on the effective date
of a Change in Control or within twelve (12) months thereafter, and if the Executive provides the
Company with a signed general release of all claims against the Company and its affiliates in a
form reasonably acceptable to the Company (the “Release”) within the 21-day period
following the date of termination of employment and the seven-day revocation period for the Release
has expired, then the Company shall provide the Executive with the following benefits:

          (i) Continuation of the Executive’s base salary for a period of twelve (12) months
following the Executive’s termination of employment, at the rate in effect immediately prior
to the Executive’s termination of employment (or, if higher, the rate in effect immediately
prior to the Change in Control), payable in accordance with standard payroll procedures
commencing on the first payroll date that occurs 30 days after the date of termination of
employment (except as otherwise provided in Section 2(d) below), less applicable
withholdings; provided that, solely for purposes of Section 409A of the Internal Revenue
Code of 1986, as amended (the “Code”), each installment payment is considered a
separate payment;

          (ii) With regard to the Executive’s outstanding options, twelve (12) months vesting of
the unvested shares to purchase the Company’s common stock and the immediate lapsing of any
vesting restrictions on any Company restricted stock awards that the Executive holds as of
the date of such termination of employment (the acceleration of vesting of stock options and
restricted stock described in this section shall be effective as of the date of the
Executive’s termination of employment); and

2

 

          (iii) the Company shall pay the group health, dental and vision plan continuation
coverage premiums for the Executive and, if applicable, the Executive’s covered dependents
under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, for twelve
(12) months from the date of the Executive’s termination of employment, or if earlier, until
the date upon which the Executive commences employment with another employer.

          (b) For purposes of this Agreement, “Cause” shall mean (i) gross negligence or willful
misconduct by the Executive in the performance of the Executive’s duties to the Company that is not
cured within thirty (30) days of written notice thereof, where such gross negligence or willful
misconduct has resulted or is likely to result in substantial and material damage to the Company or
its subsidiaries; (ii) the Executive’s repeated unexplained or unjustified absence from the
Company; (iii) a material and willful violation by the Executive of any federal or state law; (iv)
commission by the Executive of any act of fraud with respect to the Company; or (v) the Executive’s
commission of an act of moral turpitude or conviction of or entry of a plea of nolo
contendere to a felony.

          (c) For purposes of this Agreement, “Constructive Termination” shall mean the
Executive’s resignation within 180 days of the occurrence of any one or more of the following
events without the Executive’s prior written consent, provided that the Executive has provided
written notice to the Company within ninety (90) days of the first occurrence of the event and such
event remains uncured by the Company thirty (30) days after the Executive’s delivery to the Company
of written notice thereof:

          (i) a material diminution in the Executive’s duties, responsibilities or authority;

          (ii) a material diminution of the Executive’s base compensation (other than in
connection with a general decrease in base salaries for most similarly situated employees of
the Company or a successor corporation); or

          (iii) a material change in the geographic location at which the Executive provides
services to the Company.

     3. Section 409A.

          (a) Anything in this Agreement to the contrary notwithstanding, if at the time of the
Executive’s separation from service within the meaning of Section 409A of the Code, the Company
determines that the Executive is a “specified employee” within the meaning of Section
409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit that the Executive becomes
entitled to under this Agreement on account of the Executive’s separation from service would be
considered deferred compensation subject to the 20 percent additional tax imposed pursuant to
Section 409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code,
such payment shall not be payable and such benefit shall not be provided until the date that is the
earlier of (A) six months and one day after the Executive’s separation from service, or (B) the
Executive’s death. If any such delayed cash payment is otherwise payable on an installment basis,
the first payment shall include a catch-up payment

3

 

covering amounts that would otherwise have been paid during the six-month period but for the
application of this provision, and the balance of the installments shall be payable in accordance
with their original schedule.

          (b) To the extent that any payment or benefit described in this Agreement constitutes
“non-qualified deferred compensation” under Section 409A of the Code, and to the extent that such
payment or benefit is payable upon the Executive’s termination of employment, then such payments or
benefits shall be payable only upon the Executive’s “separation from service.” The determination
of whether and when a separation from service has occurred shall be made in accordance with the
presumptions set forth in Treasury Regulation Section 1.409A-1(h).

          (c) The parties intend that this Agreement will be administered in accordance with Section
409A of the Code. To the extent that any provision of this Agreement is ambiguous as to its
compliance with Section 409A of the Code, the provision shall be read in such a manner so that all
payments hereunder comply with Section 409A of the Code. The parties agree that this Agreement may
be amended, as reasonably requested by either party, and as may be necessary to fully comply with
Section 409A of the Code and all related rules and regulations in order to preserve the payments
and benefits provided hereunder without additional cost to either party.

     4. Binding Agreement. This Agreement shall inure to the benefit of and be enforceable
by the Executive and the Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the Executive should die while any
amount would still be payable to the Executive hereunder had the Executive continued to live, all
such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to the Executive’s devisee, legatee or other designee or, if there is no such designee,
to the Executive’s estate.

     5. Entire Agreement. This Agreement sets forth the entire agreement of the parties
hereto in respect of the subject matter contained herein and supersedes all prior agreements,
arrangements and understandings of the parties hereto with respect to the subject matter contained
herein, including, without limitation, any prior change in control agreements.

     6. Prior Agreement. This Agreement amends and restates the Prior Agreement in its
entirety. The Prior Agreement is terminated and of no further force or effect.

     7. At-Will Employment. Nothing contained in this Agreement shall (a) confer upon the
Executive any right to continue in the employ of the Company, (b) constitute any contract or
agreement of employment, or (c) interfere in any way with the at-will nature of the Executive’s
employment with the Company.

     8. Miscellaneous. No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing and signed by the
Executive and such officer as may be specifically designated by the Board. No waiver by either
party hereto at any time of any breach by the other party hereto of or compliance with, any
condition or provision of this Agreement to be performed by such other party shall be deemed a

4

 

waiver of similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. The validity, interpretation, construction and performance of this Agreement
shall be governed by the laws of the State of California without regard to its conflicts of law
principles. The section headings contained in this Agreement are for convenience only, and shall
not affect the interpretation of this Agreement. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which together shall
constitute one and the same instrument. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.

5

 

     IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument by a duly
authorized representative of the Company and by the Executive, as of the Effective Date.

	 	 	 	 	 
	 	Sincerely,

Anthera Pharmaceuticals, Inc.

 	 
	 	By:  	/s/ Christopher P. Lowe
 	 
	 	 	Name:  	Christopher P. Lowe 	 
	 	 	Title:  	Chief Business Officer and Chief Financial Officer 	 
	 
	 	Executive

 	 
	 	/s/ Colin Hislop
 	 
	 	Colin Hislop

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