Document:

EX-10.3 FORM OF PROPERTY MGT AND LEASING AGMT

Exhibit 10.3

PROPERTY MANAGEMENT AND LEASING AGREEMENT

     This PROPERTY MANAGEMENT AND LEASING AGREEMENT (this “Management Agreement”) is made and
entered into as of the ___day of
                    ,
2008, by and among COLE CREDIT PROPERTY TRUST III, INC., a
Maryland corporation (“CCPT III”), COLE REIT III OPERATING PARTNERSHIP, LP, a Delaware limited partnership
(“CCPT III OP”), and COLE REALTY ADVISORS, INC., an Arizona corporation (the “Manager”).

     WHEREAS,
CCPT III OP was organized to acquire, own, operate, lease and manage real estate
properties on behalf of CCPT III;

     WHEREAS,
CCPT III intends to raise money from the sale of its common stock to be used, net of
payment of certain offering costs and expenses, for investment in the acquisition or construction
of income-producing real estate and other real estate-related investments (including the making or
purchase of mortgage loans), some or all of which are to be acquired and held by Owner (as
hereinafter defined) on behalf of CCPT III; and

     WHEREAS, Owner intends to retain Manager to manage and coordinate the leasing of certain of
the real estate properties acquired by Owner under the terms and conditions set forth in this
Management Agreement.

     NOW, THEREFORE, in consideration of the premises and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be
legally bound hereby, do hereby agree, as follows:

ARTICLE I

DEFINITIONS

     Except as otherwise specified or as the context may otherwise require, the following terms
have the respective meanings set forth below for all purposes of this Management Agreement, and the
definitions of such terms are equally applicable both to the singular and plural forms thereof:

1.1 “Affiliate” means, with respect to any Person, (i) any Person directly or indirectly owning,
controlling or holding, with the power to vote, 10% or more of the outstanding voting securities of
such other Person; (ii) any Person 10% or more of whose outstanding voting securities are directly
or indirectly owned, controlled or held, with the 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; and
(v) any legal entity for which such Person acts as an executive officer, director, trustee or
general partner.

1.2 “Gross Revenues” means all amounts actually collected as rents or other charges for the use and
occupancy of the Properties, but shall exclude interest and other investment income of Owner and
proceeds received by Owner for a sale, exchange, condemnation, eminent domain taking, casualty or
other disposition of assets of Owner.

1.3 “Improvements” means buildings, structures, equipment from time to time located on the
Properties and all parking and common areas located on the Properties.

 

 

1.4 “Intellectual Property Rights” means all rights, titles and interests, whether foreign or
domestic, in and to any and all trade secrets, confidential information rights, patents, invention
rights, copyrights, service marks, trademarks, know-how, or similar intellectual property rights
and all applications and rights to apply for such rights, as well as any and all moral rights,
rights of privacy, publicity and similar rights and license rights of any type under the laws or
regulations of any governmental, regulatory, or judicial authority, foreign or domestic and all
renewals and extensions thereof.

1.5 “Lease” means, unless the context otherwise requires, any lease or sublease made by Owner as
landlord or by its predecessor.

1.6 “Management Fees” has the meaning set forth in Section 5.1 hereof.

1.7 “Owner” means CCPT III, CCPT III OP and any joint venture, limited liability company or other Affiliate
of CCPT III or CCPT III OP that owns, in whole or in part, on behalf of CCPT III, any Properties.

1.8 “Person” means an individual, corporation, association, business trust, estate, trust,
partnership, limited liability company or other legal entity.

1.9 “Properties” means all real estate properties owned by Owner and all tracts as yet unspecified
but to be acquired by Owner containing income-producing improvements or on which Owner will
construct income-producing improvements.

1.10 “Proprietary Properties” means all modeling algorithms, tools, computer programs, know-how,
methodologies, processes, technologies, ideas, concepts, skills, routines, subroutines, operating
instructions and other materials and aides used in performing the duties set forth in Article 2
that relate to management advice, services and techniques regarding current and potential
Properties, and all modifications, enhancements and derivative works of the foregoing.

ARTICLE II

APPOINTMENT OF MANAGER; SERVICES TO BE PERFORMED

2.1 Appointment of Manager. Owner hereby engages and retains Manager as the manager and as
tenant coordinating agent of the Properties, and Manager hereby accepts such appointment on the
terms and conditions hereinafter set forth; it being understood that this Management Agreement
shall cause Manager to be, at law, Owner’s agent upon the terms contained herein.

2.2 General Duties. Manager shall devote its best efforts to performing its duties
hereunder to manage, operate, maintain and lease the Properties in a diligent, careful and vigilant
manner. The services of Manager are to be of scope and quality not less than those generally
performed by professional property managers of other similar properties in the area. Manager shall
make available to Owner the full benefit of the judgment, experience and advice of the members of
Manager’s organization and staff with respect to the policies to be pursued by Owner relating to
the operation and leasing of the Properties.

2.3 Specific Duties. Manager’s duties include the following:

          (a) Lease Obligations. Manager shall perform all duties of the landlord under all
Leases insofar as such duties relate to operation, maintenance, and day-to-day management. Manager
shall also provide or cause to be provided, at Owner’s expense, all services normally provided to
tenants of like premises, including where applicable and without limitation, gas, electricity or
other utilities required to be furnished to tenants under Leases, normal repairs and maintenance,
and cleaning, and

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janitorial service. Manager shall arrange for and supervise the performance of all
installations and improvements in space leased to any tenant that are either expressly required
under the terms of the lease of such space or that are customarily provided to tenants.

          (b) Maintenance. Manager shall cause the Properties to be maintained in the same
manner as similar properties in the area. Manager’s duties and supervision in this respect shall
include, without limitation, cleaning of the interior and the exterior of the Improvements and the
public common areas on the Properties and the making and supervision of repair, alterations, and
decoration of the Improvements, subject to and in strict compliance with this Management Agreement
and the Leases. Construction activities undertaken by Manager, if any, will be limited to
activities related to the management, operation, maintenance, and leasing of the Property (e.g.,
repairs, renovations, and leasehold improvements).

          (c) Leasing Functions. Manager shall coordinate the leasing of the Properties and
shall negotiate and use its best efforts to secure executed Leases from qualified tenants, and to
execute same on behalf of Owner, if requested, for available space in the Properties, such Leases
to be in form and on terms approved by Owner and Manager, and to bring about complete leasing of
the Properties. Manager shall be responsible for the hiring of all leasing agents, as necessary
for the leasing of the Properties, and to otherwise oversee and manage the leasing process on
behalf of Owner.

          (d) Notice of Violations. Manager shall forward to Owner promptly upon receipt all
notices of violation or other notices from any governmental authority, and board of fire
underwriters or any insurance company, and shall make such recommendations regarding compliance
with such notice as shall be appropriate.

          (e) Personnel. Any personnel hired by Manager to maintain, operate and lease the
Property shall be the employees or independent contractors of Manager and not of Owner of such
Property, CCPT III OP or CCPT III. Manager shall use due care in the selection and supervision of such
employees or independent contractors. Manager shall be responsible for the preparation of and
shall timely file all payroll tax reports and timely make payments of all withholding and other
payroll taxes with respect to each employee.

          (f) Utilities and Supplies. Manager shall enter into or renew contracts for
electricity, gas, steam, landscaping, fuel, oil, maintenance and other services as are customarily
furnished or rendered in connection with the operation of similar rental property in the area.

          (g) Expenses. Manager shall analyze all bills received for services, work and
supplies in connection with maintaining and operating the Properties, pay all such bills when due,
and, if requested by Owner, pay, when due, utility and water charges, sewer rent and assessments,
and any other amount payable in respect to the Properties. All bills shall be paid by Manager
within the time required to obtain discounts, if any. Owner may from time to time request that
Manager forward certain bills to Owner promptly after receipt, and Manager shall comply with any
such request. Manager shall pay all bills, assessments, real property taxes, insurance premiums
and any other amount payable in respect to the Properties out of the Account (as hereinafter
defined). All expenses shall be billed at net cost (i.e., less all rebates, commissions, discounts
and allowances, however designed).

          (h) Monies Collected. Manager shall timely collect all rent and other monies, in the
form of a check or money order, from tenants and any sums otherwise due Owner with respect to the
Properties in the ordinary course of business. Owner authorizes Manager to request, demand,
collect and provide receipts for all such rent and other monies and to institute legal proceedings
in the name of Owner for the collection thereof and for the dispossession of any tenant in default
under its Lease.

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          (i) Banking Accommodations. Manager shall establish and maintain a separate checking
account in the Owner’s name and controlled by Manager subject to the provisions of this Management
Agreement (the “Account”) for funds relating to the Properties. All monies deposited from time to
time in the Account shall be and remain the property of Owner and shall be withdrawn and disbursed
by Manager for the account of Owner only as expressly permitted by this Management Agreement for
the purposes of performing the obligations of Manager hereunder. No monies collected by Manager on
Owner’s behalf shall be commingled with funds of Manager. The Account shall be maintained, and
monies shall be deposited therein and withdrawn therefrom, in accordance with the following:

               (i) All sums received from rents and other income from the Properties shall be promptly
deposited by Manager in the Account. Manager shall have the right to designate two or more persons
who shall be authorized to draw against the Account, but only for purposes authorized by this
Management Agreement.

               (ii) All sums due to Manager hereunder, whether for compensation, reimbursement for
expenditures, or otherwise, as herein provided, shall be a charge against the operating revenues of
the Properties and shall be paid and/or withdrawn by Manager from the Account prior to the making
of any other disbursements therefrom.

               (iii) By the 15th day after the end of each month, Manager shall forward to Owner
all monies contained in the Account other than a reasonable minimum balance (to be determined
jointly by Manager and Owner from time to time) and any other amounts otherwise provided in the
budget, which shall remain in the Account.

          (j) Ownership Agreements. Manager has received copies of (and will be provided with
copies of future) articles of incorporation, agreements of limited partnership, joint venture
partnership agreements and operating agreements, each as may be amended from time to time, of
Owner, as applicable (the “Ownership Agreements”) and is familiar with the terms thereof. Manager
shall use reasonable care to avoid any act or omission that, in the performance of its duties
hereunder, shall in any way conflict with the terms of Ownership Agreements.

          (k) Signs. Manager shall place and remove, or cause to be placed and removed, such
signs upon the Properties as Manager deems appropriate, subject, however, to the terms and
conditions of the Leases and to any applicable ordinances and regulations.

2.4 Approval of Leases, Contracts, Etc. In fulfilling its duties to Owner, Manager may and
hereby is authorized to enter into any leases, contracts or agreements on behalf of Owner in the
ordinary course of the management, operation, maintenance and leasing of the Property.

2.5 Accounting, Records and Reports.

          (a) Records. Manager shall maintain all office records and books of account and shall
record therein, and keep copies of, each invoice received from services, work and supplies ordered
in connection with the maintenance and operation of the Properties. Such records shall be
maintained on a double entry basis. Owner and persons designated by Owner shall at all reasonable
times have access to and the right to audit and make independent examinations of such records,
books and accounts and all vouchers, files and all other material pertaining to the Properties and
this Management Agreement, all of which Manager agrees to keep safe, available and separate from
any records not pertaining to the Properties, at a place recommended by Manager and approved by
Owner.

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          (b) Monthly Reports. On or before the 15th day after the end of each month
during the term of this Management Agreement, Manager shall prepare and submit to Owner the
following reports and statements:

               (i) rental collection record;

               (ii) monthly operating statement;

               (iii) copy of cash disbursements ledger entries for such period, if requested;

               (iv) copy of cash receipts ledger entries for such period, if requested;

               (v) the original copies of all contracts entered into by Manager on behalf of Owner during
such period, if requested; and

               (vi) copy of ledger entries for such period relating to security deposits maintained by
Manager, if requested.

          (c) Budgets and Leasing Plans. Not later than November 15 of each calendar year,
Manager shall prepare and submit to Owner for its approval an operating budget and a marketing and
leasing plan on each Property for the calendar year immediately following such submission. In
connection with any acquisition of a Property by Owner, Manager shall prepare a budget and
marketing and leasing plan for the remainder of the calendar year. The budget and marketing and
leasing plan shall be in the form of the budget and plan approved by Owner prior to the date
thereof. As often as reasonably necessary during the period covered by any such budget, Manager
may submit to Owner for its approval an updated budget or plan incorporating such changes as shall
be necessary to reflect cost over-runs and the like during such period. If Owner does not
disapprove any such budget within 30 days after receipt thereof by Owner, such budget shall be
deemed approved. If Owner shall disapprove any such budget or plan, it shall so notify Manager
within said 30-day period and explain the reasons therefor. If Owner disapproves of any budget or
plan, Manager shall submit a revised budget or plan, as applicable, within 10 (ten) days of receipt
of the notice of disapproval, and Owner shall have 10 (ten) days to provide notice to Manager if it
disapproves of any such revised budget or plan. Manager will not incur any costs other than those
estimated in any budget except for:

          (i) tenant improvements and real estate commissions required under
a Lease;

          (ii) maintenance or repair costs under $10,000 per Property;

          (iii) costs incurred in emergency situations in which action is immediately necessary for the
preservation or safety of the Property, or for the safety of occupants or other persons (or to
avoid the suspension of any necessary service of the Property);

          (iv) expenditures for real estate taxes and assessment; and

          (v) maintenance supplies calling for an aggregate purchase price less than $25,000 per annum
for all Properties.

     Budgets prepared by Manager shall be for planning and informational purposes only, and Manager
shall have no liability to Owner for any failure to meet any such budget. However, Manager will
use its best efforts to operate within the approved budget.

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          (d) Legal Requirements. Manager shall execute and file when due all forms, reports,
and returns required by law relating to the employment of its personnel. Manager shall be
responsible for notifying Owner in the event it receives notice that any Improvement on a Property
or any equipment therein does not comply with the requirements of any statute, ordinance, law or
regulation of any governmental body or of any public authority or official thereof having or
claiming to have jurisdiction thereover. Manager shall promptly forward to Owner any complaints,
warnings, notices or summonses received by it relating to such matters. Owner represents that to
the best of its knowledge each of its Properties and any equipment thereon will upon acquisition by
Owner comply with all such requirements. Owner authorizes Manager to disclose the ownership of the
Property by Owner to any such officials. Owner agrees to indemnify, protect, defend, save and hold
Manager and its stockholders, officers, directors, employees, managers, successors and assigns
(collectively, the “Indemnified Parties”) harmless of and from any and all Losses (as defined in
Section 3.5(a) hereof) that may be imposed on them or any or all of them by reason of the failure
of Owner to correct any present or future violation or alleged violation of any and all present or
future laws, ordinances, statutes, or regulations of any public authority or official thereof,
having or claiming to have jurisdiction thereover, of which it has actual notice.

ARTICLE III

AUTHORITY GRANTED TO MANAGER AND CERTAIN OWNER OBLIGATIONS

3.1 Authority As To Tenants, Etc. Owner agrees and does hereby give Manager the following
exclusive authority and powers (all of which shall be exercised either in the name of Manager, as
Manager for Owner, or in the name or Owner entered into by Manager as Owner’s authorized agent, and
Owner shall assume all expenses in connection with such matters):

          (a) to advertise each Property or any part thereof and to display signs thereon, as permitted
by law;

          (b) to lease the Properties to tenants;

          (c) to pay all expenses of leasing such Property, including but not limited to, newspaper and
other advertising, signage, banners, brochures, referral commissions, leasing commissions, finder’s
fees and salaries, bonuses and other compensation of leasing personnel responsible for the leasing
of the Property;

          (d) to cause references of prospective tenants to be investigated, it being understood and
agreed by the parties hereto that Manager does not guarantee the creditworthiness or collectibility
of accounts receivable from tenants, users or lessees; and to negotiate new Leases and renewals and
cancellations of existing Leases that shall be subject to Manager obtaining Owner’s approval;

          (e) to collect from tenants all or any of the following: a late rent administrative charge, a
non-negotiable check charge, credit report fee, a subleasing administrative charge and/or broker’s
commission; and Manager need not account for such charges and/or commission to Owner;

          (f) to terminate tenancies and to sign and serve in the name of Owner of each Property such
notices as are deemed necessary by Manager:

               (i) to institute and prosecute actions to evict tenants and to recover possession of the
Property or portions thereof; and

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               (ii) with Owner’s authorization, to sue for and in the name of Owner and recover rent and
other sums due; and to settle, compromise, and release such actions or suits, or reinstate such
tenancies. All expenses of litigation including, but not limited to, attorneys’ fees, filing fees,
and court costs that Manager shall incur in connection with the collecting of rent and other sums,
or to recover possession of any Property or any portion thereof, shall be deemed to be an
operational expense of the Property. Manager and Owner shall concur on the selection of the
attorneys to handle such litigation.

3.2 Operational Authority. Owner agrees and does hereby give Manager the following
exclusive authority and powers (all of which shall be exercised either in the name of Manager, as
Manager for Owner, or in the name of Owner entered into by Manager as Owner’s authorized agent, and
Owner shall assume all expenses in connection with such matters):

          (a) to hire, supervise, discharge, and pay all labor required for the operation and
maintenance of each Property including but not limited to on-site personnel, managers, assistant
managers, leasing consultants, engineers, janitors, maintenance supervisors and other employees
required for the operation and maintenance of the Property, including personnel spending a portion
of their working hours (to be charged on a pro rata basis) at the Property. All expenses of such
employment shall be deemed operational expenses of the Property.

          (b) to make or cause to be made all ordinary repairs and replacements necessary to preserve
each Property in its present condition and for the operating efficiency thereof and all alterations
required to comply with lease requirements, and to decorate the Property;

          (c) to negotiate and enter into, as Manager of the Property, contracts for all items on
budgets that have been approved by Owner, any emergency services or repairs for items not exceeding
$10,000, appropriate service agreements and labor agreements for normal operation of the Property,
which have terms not to exceed three years, and agreements for all budgeted maintenance, minor
alterations, and utility services, including, but not limited to, electricity, gas, fuel, water,
telephone, window washing, scavenger service, landscaping, snow removal, pest exterminating,
decorating and legal services in connection with the Leases and service agreements relating to the
Property, and other services or such of them as Manager may consider appropriate; and

          (d) to purchase supplies and pay all bills.

Manager shall use its best efforts to obtain the foregoing services and utilities for the Property
under terms that are as cost-effective and otherwise favorable to Manager as possible for the
quality of services and utilities required. Owner hereby appoints Manager as Owner’s authorized
Manager for the purpose of executing, as Manager for said Owner, all such contracts. In addition,
Owner agrees to specifically assume in writing all obligations under all such contracts so entered
into by Manager, on behalf of Owner of the Property, upon the termination of this Manager
Agreement, and Owner shall indemnify, protect, save, defend and hold Manager and the other
Indemnified Parties harmless from and against any and all Losses resulting from, arising out of or
in any way related to such contracts and that relate to or concern matters occurring after
termination of this Management Agreement, but excluding matters arising out of Manager’s willful
misconduct, gross negligence and/or unlawful acts. Manager shall secure the written approval of
appropriate contracts by Owner for any non-budgeted and non-emergency/contingency capital items,
alterations or other expenditures in excess of $10,000 for any one item, securing for each item at
least three written bids, if practicable, or providing evidence satisfactory to Owner, including
such reasonable actions taken by the Manager, that the contract amount is lower than industry
standard pricing, from responsible contractors. Manager shall have the right from time to time
during the term hereof, to contract with and make purchases from Affiliates of Manager, provided
that contract rates and prices are competitive with other available sources. Manager may, at any
time and from time to time, request and

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receive prior written authorization from Owner for any one or more purchases or other expenditures,
notwithstanding that Manager may otherwise be authorized hereunder to make such purchases or
expenditures.

3.3 Rent and Other Collections. Owner agrees and does hereby give Manager the exclusive
authority and powers (all of which shall be exercised either in the name of Manager, as Manager for
Owner, or in the name or Owner entered into by Manager as Owner’s authorized agent, and Owner shall
assume all expenses in connection with such matters) to collect rents and/or assessments and other
items, including but not limited to tenant payments for real estate taxes, property liability and
other insurance, damages and repairs, common area maintenance, tax reduction fees and all other
tenant reimbursements, administrative charges, proceeds of rental interruption insurance, parking
fees, income from coin operated machines and other miscellaneous income, due or to become due and
give receipts therefor and to deposit all such Gross Revenue collected hereunder in the Account.
Manager may endorse any and all checks received in connection with the operation of any Property
and drawn to the order of Owner, and Owner shall, upon request, furnish Manager’s depository with
an appropriate authorization for Manager to make such endorsement. Manager shall also have the
exclusive authority to collect and handle tenants’ security deposits, including the right to apply
such security deposits to unpaid rent, and to comply, on behalf of Owner of the Property, with
applicable state or local laws concerning security deposits and interest thereon, if any. Manager
shall not be required to advance any monies for the care or management of any Property. Owner
agrees to advance all monies necessary therefor. If Manager shall elect to advance any money in
connection with a Property, as permitted by applicable law, Owner agrees to reimburse Manager
forthwith and hereby authorizes Manager to deduct such advances from any monies due Owner. In
connection with any insured losses or damages relating to any Property, Manager shall have the
exclusive authority to handle all steps necessary regarding any such claim; provided that Manager
will not make any adjustments or settlements in excess of $10,000 without Owner’s prior written
consent.

3.4 Payment of Expenses. Owner agrees and does hereby give Manager the exclusive authority
and power (all of which shall be exercised either in the name of Manager, as Manager for Owner, or
in the name or Owner entered into by Manager as Owner’s authorized agent, and Owner shall assume
all expenses in connection with such matters) to pay all expenses of the Property from the Gross
Revenue collected in accordance with Section 3.3 above, from the Account. It is understood that
the Gross Revenue will be used first to pay the compensation to Manager as contained in Article 5
below, then operational expenses and then any mortgage indebtedness, including real estate tax and
insurance impounds, but only as directed by Owner in writing and only if sufficient Gross Revenue
is available for such payments. Nothing in this Management Agreement shall be interpreted in such
a manner as to obligate Manager to pay from Gross Revenue, any expenses incurred by Owner prior to
the commencement of this Management Agreement, except to the extent Owner advances additional funds
to pay such expenses.

3.5 Certain Owner Indemnification Obligations.

          (a) On Termination. Subject to the requirements of Section 6.5 hereof, in the event
this Management Agreement is terminated for any reason prior to the expiration of its original term
or any renewal term, Owner shall indemnify, protect, defend, save and hold Manager and all of the
other Indemnified Parties harmless from and against any and all claims, causes of action, demands,
suits, proceedings, loss, judgments, damage, awards, liens, fines, costs, attorney’s fees and
expenses, of every kind and nature whatsoever (collectively, “Losses”), that may be imposed on or
incurred by Manager by reason of the willful misconduct, gross negligence and/or unlawful acts
(such unlawfulness having been adjudicated by a court of proper jurisdiction) of Owner.

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          (b) Property Damage, Etc. Subject to the requirements of Section 6.5 hereof, Owner
agrees to indemnify, defend, protect, save and hold Manager and all of the other Indemnified
Parties harmless from any and all Losses in connection with or in any way related to the Property
and from liability for damage to the Property and injuries to or death of any person whomsoever,
and damage to property; provided, however, that such indemnification shall not extend to any such
Losses arising out of the misconduct, negligence or unlawful acts (such unlawfulness having been
adjudicated by a court of proper jurisdiction) of Manager or any of the other Indemnified Parties.
Manager shall not be liable for any error of judgment or for any mistake of fact or law, or for any
thing that it may do or refrain from doing, except in cases of misconduct, negligence or unlawful
acts (such unlawfulness having been adjudicated by a court of proper jurisdiction).

3.6 Environmental Matters. Owner hereby warrants and represents to Manager that to the
best of Owner’s knowledge, no Property, upon acquisition by Owner, nor any part thereof, will be
used to treat, deposit, store, dispose of or place any hazardous substance that may subject Manager
to liability or claims under the Comprehensive Environmental Response, Compensation and Liability
Act of 1980 (42 U.S.C.A. Section 9607), or any successor statute thereof, or any constitutional
provision, statute, ordinance, law, or regulation of any governmental body or of any order or
ruling of any public authority or official thereof, having or claiming to have jurisdiction
thereover. Furthermore, Owner agrees to indemnify, protect, defend, save and hold Manager and all
of the other Indemnified Parties from any and all Losses involving, concerning or in any way
related to any past, current or future allegations regarding treatment, depositing, storage,
disposal or placement by any party other than Manager of hazardous substances on the Property.

3.7 Legal Status of Properties. Owner represents that to the best of its knowledge each
Property and any equipment thereon, when acquired by Owner, will comply with all legal requirements
and authorizes Manager to disclose the identity of the Owner of the Property to any such officials
and agrees to indemnify, protect, defend, save and hold Manager and the other Indemnified Parties
harmless of and from any and all Losses that may be imposed on them or any of them by reason of the
failure of Owner to correct any present or future violation or alleged violation of any and all
present or future laws, ordinances, statutes, or regulations of any public authority or official
thereof, having or claiming to have jurisdiction thereover, of which it has actual notice. In the
event it is alleged or charged that any Improvement or any equipment on a Property or any act or
failure to act by Owner with respect to the Property or the sale, rental, or other disposition
thereof fails to comply with, or is in violation of, any of the requirements of any constitutional
provision, statute, ordinance, law, or regulation of any governmental body or any order or ruling
of any public authority or official thereof having or claiming to have jurisdiction thereover, and
Manager, in its sole and absolute discretion, considers that the action or position of Owner, with
respect thereto may result in damage or liability to Manager, Manager shall have the right to
cancel this Management Agreement at any time by written notice to Owner of its election so to do,
which cancellation shall be effective upon the service of such notice. Such cancellation shall not
release the indemnities of Owner set forth in this Management Agreement and shall not terminate any
liability or obligation of Owner to Manager for any payment, reimbursement, or other sum of money
then due and payable to Manager hereunder.

3.8 Extraordinary Payments. Owner agrees to give adequate advance written notice to
Manager if Owner desires that Manager make any extraordinary payment, out of Gross Revenue, to the
extent funds are available after the payment of Manager’s compensation as provided for herein and
all operational expenses, of mortgage indebtedness, general taxes, special assessments, or fire,
boiler or any other insurance premiums.

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ARTICLE IV

EXPENSES

4.1 Owner’s Expenses. Except as otherwise specifically provided, all costs and expenses
incurred hereunder by Manager in fulfilling its duties to Owner shall be for the account of and on
behalf of Owner. Such costs and expenses shall include the wages and salaries and other
employee-related expenses, unless otherwise waived, in whole or in part, by the Manager in its sole
discretion, of all on-site and off-site employees of Manager who are engaged in the operation,
management, maintenance and leasing or access control of the Properties, including taxes, insurance
and benefits relating to such employees, and legal, travel and other out-of-pocket expenses that
are directly related to the management of specific Properties. All costs and expenses for which
Owner is responsible under this Management Agreement shall be paid by Manager out of the Account.
In the event the Account does not contain sufficient funds to pay all said expenses, Owner shall
fund all sums necessary to meet such additional costs and expenses.

4.2 Manager’s Expenses. Manager shall, out of its own funds, pay all of its general
overhead and administrative expenses.

ARTICLE V

MANAGER’S COMPENSATION

5.1 Management Fees.

          (a) Owner shall pay Manager property management and leasing fees in an amount equal to (i) two
percent (2.0%) of Gross Revenues of single-tenant properties and (ii) four percent (4.0%) of Gross
Revenues of multi-tenant properties, plus reimbursement of Manager’s cost of maintaining the
property, less all payments to third-party property management subcontractors (the “Management
Fees”) on a monthly basis from the rental income received from the Properties over the term of this
Management Agreement. In addition, in the event that the Owner contracts, directly, with a
third-party property manager in respect of a property, the Owner, in it sole discretion, may pay
Manager an oversight fee in an aggregate amount of up to one percent (1%) of the Gross Revenues of
the property managed (the “Oversight Fee”); provided however that in no event shall the Owner pay
both Management Fees and an Oversight Fee to Manager with respect to the same property.

          (b) Manager’s compensation under this Section 5.1 shall apply to all renewals, extensions or
expansions of Leases that Manager has originally negotiated. In the event Manager assists with
planning and coordinating the construction of any tenant improvements or capital improvements,
Manager shall be entitled to receive from the Owner for any such tenant improvement an amount equal
to not greater than five percent (5.0%) of the cost of such improvements.

5.2 Leasing Fees. In addition to the compensation paid to Manager under Section 5.1 above,
Manager shall be entitled to receive a separate fee for the Leases of new tenants and renewals of
Leases with existing tenants in an amount not to exceed the fee customarily charged in arm’s length
transactions by others rendering similar services in the same geographic area for similar
properties as determined by a survey of brokers and agents in such area (“Leasing Fees”).

5.3 Audit Adjustment. If any audit of the records, books or accounts relating to the
Properties discloses an overpayment or underpayment of Management Fees, Owner or Manager shall
promptly pay to the other party the amount of such overpayment or underpayment, as the case may be.
If such audit

-10-

 

discloses an overpayment of Management Fees for any fiscal year of more than the correct Management
Fees for such fiscal year, Manager shall bear the cost of such audit.

5.4 Additional Services. Any services beyond those specified herein, such as sales,
brokerage, loan origination and servicing, property tax reduction and risk management services,
shall be performed by Manager and compensated by Owner only if the parties agree on the scope of
such work and provided that the compensation to be paid therefore will not exceed that which would
be paid to unrelated parties providing such services and provided further that all such
compensation must be approved by a majority of the directors, including a majority of the
independent directors (as defined in the charter of the Owner), not otherwise interested in the
transaction, of Owner.

ARTICLE VI

INSURANCE AND INDEMNIFICATION

6.1 Insurance to be Carried.

          (a) Manager shall obtain and keep in full force and effect insurance on the Properties against
such hazards as Owner and Manager shall deem appropriate, but in any event insurance sufficient to
comply with the Leases and Ownership Agreements shall be maintained. All liability policies shall
provide sufficient insurance satisfactory to both Owner and Manager and shall contain waivers of
subrogation for the benefit of Manager.

          (b) Manager shall obtain and keep in full force and effect, in accordance with the laws of the
state in which each Property is located, employer’s liability insurance applicable to and covering
all employees of Manager at the Properties and all persons engaged in the performance of any work
required hereunder, and Manager shall furnish Owner certificates of insurers naming Owner as a
co-insured and evidencing that such insurance is in effect. If any work under this Management
Agreement is subcontracted as permitted herein, Manager shall include in each subcontract a
provision that the subcontractor shall also furnish Owner with such a certificate.

6.2 Insurance Expenses. Premiums and other expenses of such insurance, as well as any
applicable payments in respect of deductibles shall be borne by Owner.

6.3 Cooperation with Insurers. Manager shall cooperate with and provide reasonable access
to the Properties to representatives of insurance companies and insurance brokers or agents with
respect to insurance that is in effect or for which application has been made. Manager shall use
its best efforts to comply with all requirements of insurers.

6.4 Accidents and Claims. Manager shall promptly investigate and shall report in detail to
Owner all accidents, claims for damage relating to Ownership, operation or maintenance of the
Properties, and any damage or destruction to the Properties and the estimated costs of repair
thereof, and shall prepare for approval by Owner all reports required by an insurance company in
connection with any such accident, claim, damage, or destruction. Such reports shall be given to
Owner promptly, and any report not so given within thirty (30) days after the occurrence of any
such accident, claim, damage or destruction shall be noted in the monthly operating statement
delivered to Owner pursuant to Section 2.5(b). Manager is authorized to settle any claim against
an insurance company arising out of any policy and, in connection with such claim, to execute
proofs of loss and adjustments of loss and to collect and receipt for loss proceeds.

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6.5 Indemnification. Manager shall hold Owner harmless from and indemnify and defend Owner
against any and all claims or liability for any injury or damage to any person or property
whatsoever for which Manager is responsible occurring in, on, or about the Properties, including,
without limitation, the Improvements when such injury or damage shall be caused by the negligence
of Manager, its agents, servants, or employees, except to the extent that Owner recovers insurance
proceeds with respect to such matter. Owner will indemnify and hold Manager harmless against all
liability for injury to persons and damage to property caused by Owner’s negligence and which did
not result from the negligence of misconduct of Manager, except to the extent Manager recovers
insurance proceeds with respect to such matter. Notwithstanding the foregoing, if the person
seeking indemnification under this Section 6.5 is an Affiliate, such person’s right to
indemnification is subject to any limitations set forth in the Company’s Articles of Incorporation
or any amendments thereto.

ARTICLE VII

TERM AND TERMINATION

7.1 Term. This Management Agreement shall commence on the date first above written and
shall continue until the first (1st) anniversary of such date. Thereafter, this Management
Agreement may be renewed for an unlimited number of successive one-year terms upon mutual consent
of the parties. Each such renewal shall be for a term of no more than one year. It is the duty of
the Board of Directors to evaluate the performance of the Manager annually before renewing this
Management Agreement. In addition, either party may terminate this Management Agreement
immediately upon the occurrence of any of the following:

          (a) A decree or order is rendered by a court having jurisdiction (i) adjudging Manager as
bankrupt or insolvent, or (ii) approving as properly filed a petition seeking reorganization,
readjustment, arrangement, composition or similar relief for Manager under the federal bankruptcy
laws or any similar applicable law or practice, or (iii) appointing a receiver or liquidator or
trustee or assignee in bankruptcy or insolvency of Manager or a substantial part of the property of
Manager, or for the winding up or liquidation of its affairs, or

          (b) Manager (i) institutes proceedings to be adjudicated a voluntary bankrupt or an insolvent,
(ii) consents to the filing of a bankruptcy proceeding against it, (iii) files a petition or answer
or consent seeking reorganization, readjustment, arrangement, composition or relief under any
similar applicable law or practice, (iv) consents to the filing of any such petition, or to the
appointment of a receiver or liquidator or trustee or assignee in bankruptcy or insolvency for it
or for a substantial part of its property, (v) makes an assignment for the benefit of creditors,
(vi) is unable to or admits in writing its inability to pay its debts generally as they become due
unless such inability shall be the fault of the other party, or (iv) takes corporate or other
action in furtherance of any of the aforesaid purposes.

Upon any termination pursuant to this Section 7.1, the provisions and obligations of this
Management Agreement shall be deemed terminated, except that the obligation of the parties for fees
due between one another and the obligations of indemnity set forth herein shall survive such
termination. Manager shall cooperate with Owner in transfers of management and accounting
functions hereunder.

7.2 Manager’s Obligations Upon Termination. Upon the termination of this Management
Agreement, Manager shall have the following duties:

          (a) Manager shall deliver to Owner or its designee, all books and records with respect to the
Properties.

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     (b) Manager shall transfer and assign to Owner, or its designee, all service contracts and
personal property relating to or used in the operation and maintenance of the Properties, except
personal property paid for and owned by Manager. Manager shall also, for a period of sixty (60)
days immediately following the date of such termination, make itself available to consult with and
advise Owner, or its designee, regarding the operation, maintenance and leasing of the Properties.

     (c) Manager shall render to Owner an accounting of all funds of Owner in its possession and
shall deliver to Owner a statement of all Management Fees claimed to be due to Manager and shall
cause funds of Owner held by Manager relating to the Properties to be paid to Owner or its
designee.

7.3 Owner’s Obligations Upon Termination. Owner shall pay or reimburse Manager for any
sums of money due it under this Management Agreement for services and expenses prior to termination
of this Management Agreement. All provisions of this Management Agreement that require Owner to
have insured, or to protect, defend, save, hold and indemnify or to reimburse Manager shall survive
any expiration or termination of this Management Agreement and, if Manager is or becomes involved
in any claim, proceeding or litigation by reason of having been Manager of Owner, such provisions
shall apply as if this Management Agreement were still in effect.

The parties understand and agree that Manager may withhold funds for sixty (60) days after the end
of the month in which this Management Agreement is terminated to pay bills previously incurred but
not yet invoiced and to close accounts. Should the funds withheld be insufficient to meet the
obligation of Manager to pay bills previously incurred, Owner will, upon demand, advance sufficient
funds to Manager to ensure fulfillment of Manager’s obligation to do so, within ten (10) days of
receipt of notice and an itemization of such unpaid bills.

ARTICLE VIII

MISCELLANEOUS

8.1 Notices. All notices, approvals, consents and other communications hereunder shall be
in writing, and, except when receipt is required to start the running of a period of time, shall be
deemed given when delivered in person or on the fifth day after its mailing by either party by
registered or certified United States mail, postage prepaid and return receipt requested, to the
other party, at the addresses set forth after their respect name below or at such different
addresses as either party shall have theretofore advised the other party in writing in accordance
with this Section 8.1.

	 	 	 	 	 
	 

	 	Owner:
	 	COLE REIT III OPERATING PARTNERSHIP, LP
	 

	 	 	 	c/o Cole Credit Property Trust III, Inc.
	 

	 	 	 	2555 E. Camelback Road, Suite 400
	 

	 	 	 	Phoenix, Arizona 85016
	 

	 	 	 	Attention: General Partner
	 
	 	 	 	 
	 

	 	Manager:
	 	COLE REALTY ADVISORS, INC.
	 

	 	 	 	2555 E. Camelback Road, Suite 400
	 

	 	 	 	Phoenix, Arizona 85016
	 

	 	 	 	Attention: Chief Executive Officer

8.2 Governing Law; Venue. This Management Agreement shall be governed by and construed in
accordance with the laws of the State of Arizona, and any action brought to enforce the agreements
made

-13-

 

hereunder or any action which arises out of the relationship created hereunder shall be brought
exclusively in Maricopa County, Arizona.

8.3 Assignment. Manager may delegate partially or in full its duties and rights under this
Management Agreement but only with the prior written consent of Owner. Owner acknowledges and
agrees that any or all of the duties of Manager as contained herein may be delegated by Manager and
performed by a person or entity (“Submanager”) with whom Manager contracts for the purpose of
performing such duties. Owner specifically grants Manager the authority to enter into such a
contract with a Submanager; provided that, unless Owner otherwise agrees in writing with such
Submanager, Owner shall have no liability or responsibility to any such Submanager for the payment
of the Submanager’s fee or for reimbursement to the Submanager of its expenses or to indemnify the
Submanager in any manner for any matter; and provided further that Manager shall require such
Submanager to agree, in the written agreement setting forth the duties and obligations of such
Submanager, to indemnify Owner for all Losses incurred by Owner as a result of the willful
misconduct or gross negligence of the Submanager, except that such indemnity shall not be required
to the extent that Owner recovers issuance proceeds with respect to such matter. Any contract
entered into between Manager and a Submanager pursuant to this Section 8.3 shall be consistent with
the provisions of this Management Agreement, except to the extent Owner otherwise specifically
agrees in writing. This Management Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective successors and assigns. Owner may assign its rights
under this Management Agreement as to any particular Property to a lender or lenders pursuant to
the terms of any loan or loans obtained related to the Properties. In connection therewith, any
Affiliate of Cole REIT or Cole OP that is an Owner is hereby authorized to execute and deliver any
and all documents required by a lender in order to carry out the intent of the immediately
foregoing sentence.

8.4 Third Party Leasing Services. Manager acknowledges that from time to time Owner may
determine that it is in the best interests of Owner to retain a third party to provide certain
leasing services with respect to certain Properties and to compensate such third party for such
leasing services. Upon the prior written consent of Manager, Owner shall have the authority to
enter into such a contract for leasing services with a third party (a “Third Party Leasing
Agreement”); provided that Manager shall have no liability or responsibility to Owner for any of
the duties and obligations undertaken by such party, and Owner agrees to indemnify Manager for all
Losses incurred by Manager as a result of acts of such third party pursuant to the Third Party
Leasing Agreement. To the extent that leasing services are specifically required to be performed
by a third party pursuant to such Third Party Leasing Agreement, Manager shall have no obligation
to perform such leasing services and Owner shall have no obligation to Manager for leasing fees
pursuant to Section 5.2 hereof. To the extent that both Manager and such Third Party Leasing
Agreement provides leasing services with respect to certain Properties, the Leasing fees payable to
Manager pursuant to Section 5.2 hereof shall be reduced by the amounts payable with respect to such
Properties to such Third Party Leasing Agreement.

8.5 Third Party Management Services. Manager acknowledges that, from time to time, Owner
may acquire interests in Properties in which Owner does not control the determination of the party
that is engaged to provide property management and other services to be provided by Manager with
respect to all Properties acquired by Owner hereunder. Upon the prior written consent of Manager,
Owner shall have the authority to acquire such non-controlling interests in Properties for which a
third party provides some or all of the services otherwise required to be performed by Manager
hereunder (a “Third Party Management Agreement”); provided that Manager shall have no liability or
responsibility to Owner for any of the duties and obligations undertaken by such third party, and
Owner agrees to indemnify Manager for all Losses incurred by Manager as a result of the acts of
such third party pursuant to the Third Party Management Agreement. To the extent that property
management and other services are specifically required to be performed by a third party pursuant
to such Third Party Management Agreement, Manager

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shall have no obligation to perform such services and Owner shall have no obligation to Manager for
compensation for such services pursuant to Article V hereof. To the extent that both Manager and
such Third Party Leasing Agreement provides leasing services with respect to certain Properties,
the Leasing fees payable to Manager pursuant to Section 5.2 hereof shall be reduced by the amounts
payable with respect to such Properties to such Third Party Leasing Agreement.

8.6 No Waiver. The failure of Owner to seek redress for violation or to insist upon the
strict performance of any covenant or condition of this Management Agreement shall not constitute a
waiver thereof for the future.

8.7 Amendments. This Management Agreement may be amended only by an instrument in writing
signed by the party against whom enforcement of the amendment is sought.

8.8 Headings. The headings of the various subdivisions of this Management Agreement are
for reference only and shall not define or limit any of the terms or provisions hereof.

8.9 Counterparts. This Management Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, and it shall not be necessary in making proof of this
Management Agreement to produce or account for more than one such counterpart.

8.10 Entire Agreement. This Management Agreement contains the entire understanding and all
agreements between Owner and Manager respecting the management of the Properties. There are no
representations, agreements, arrangements or understandings, oral or written, between Owner and
Manager relating to the management of the Properties that are not fully expressed herein.

8.11 Disputes. If there shall be a dispute between Owner and Manager relating to this
Management Agreement resulting in litigation, the prevailing party in such litigation shall be
entitled to recover from the other party to such litigation such amount as the court shall fix as
reasonable attorneys’ fees.

8.12 Activities of Manager. The obligations of Manager pursuant to the terms and
provisions of this Management Agreement shall not be construed to preclude Manager from engaging in
other activities or business ventures, whether or not such other activities or ventures are in
competition with Owner or the business of Owner.

8.13 Independent Contractor. Manager and Owner shall not be construed as joint venturers
or partners of each other pursuant to this Management Agreement, and neither shall have the power
to bind or obligate the other except as set forth herein. In all respects, the status of Manager
to Owner under this Management Agreement is that of an independent contractor.

8.14 No Third-Party Rights. Nothing expressed or referred to in this Management Agreement
will be construed to give any Person other than the parties to this Management Agreement any legal
or equitable right, remedy or claim under or with respect to this Management Agreement or any
provision of this Management Agreement, except such rights as shall inure to a successor or
permitted assignee pursuant to Section 8.3.

8.15 Ownership of Proprietary Property. The Manager retains ownership of and reserves all
Intellectual Property Rights in the Proprietary Property. To the extent that Owner has or obtains
any claim to any right, title or interest in the Proprietary Property, including without limitation
in any suggestions, enhancements or contributions that Owner may provide regarding the Proprietary
Property, Owner hereby assigns and transfers exclusively to the Manager all right, title and
interest, including without limitation all Intellectual Property Rights, free and clear of any
liens, encumbrances or licenses in

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favor of Owner or any other party, in and to the Proprietary Property. In addition, at the
Manager’s expense, Owner will perform any acts that may be deemed desirable by the Manager to
evidence more fully the transfer of ownership of right, title and interest in the Proprietary
Property to the Manager, including but not limited to the execution of any instruments or documents
now or hereafter requested by the Manager to perfect, defend or confirm the assignment described
herein, in a form determined by the Manager.

[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]

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     IN WITNESS WHEREOF, the parties have executed this Property Management and Leasing Agreement
as of the date first above written.

	 	 	 	 	 	 	 	 	 
	 	 	COLE CREDIT PROPERTY
TRUST III, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Christopher H. Cole
	 	 
	 	 	 	 	Chief Executive Officer and President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	COLE REIT III OPERATING PARTNERSHIP, LP	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Cole Credit Property Trust III, Inc.	 	 
	 	 	 	 	General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Christopher H. Cole	 	 
	 

	 	 	 	 	 	Chief Executive Officer and President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	COLE REALTY ADVISORS, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Christopher H. Cole	 	 
	 	 	 	 	Chief Executive Officer and President	 	 

-17-EX-10.4 FORM OF ADVISORY AGREEMENT

Exhibit 10.4

ADVISORY AGREEMENT

     This
ADVISORY AGREEMENT (this “Agreement”) is entered into on this the ___ day of
[                    ],
2008, by and between COLE CREDIT PROPERTY TRUST III, INC., a Maryland corporation
(the “Company”), and COLE REIT ADVISORS III, LLC, a Delaware limited liability company (the
"Advisor”).

W I T N E S S E T H

     WHEREAS, the Company intends to issue shares of its common stock, par value $.01, to the
public, upon registration of such shares with the Securities and Exchange Commission pursuant to
the Securities Act of 1933, as amended;

     WHEREAS, the Company intends to qualify as a real estate investment trust and to invest its
funds in investments permitted by the terms of the Company’s Articles of Incorporation and Sections
856 through 860 of the Internal Revenue Code;

     WHEREAS, the Company desires to avail itself of the experience, sources of information,
advice, assistance and certain facilities available to the Advisor and to have the Advisor
undertake the duties and responsibilities hereinafter set forth, on behalf of, and subject to the
supervision of, the Board of Directors (the “Board”) of the Company, all as provided herein; and

     WHEREAS, the Advisor is willing to undertake to render such services, subject to the
supervision of the Board, on the terms and conditions hereinafter set forth.

     NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

     The following defined terms used in this Agreement shall have the meanings specified below:

Acquisition Expenses. Any and all expenses incurred by the Company, the Advisor, or any
Affiliate of either in connection with the selection, acquisition or development of any Asset,
whether or not acquired, including, without limitation, legal fees and expenses, travel and
communications expenses, costs of appraisals, nonrefundable option payments on property not
acquired, accounting fees and expenses, and title insurance premiums.

Acquisition Fees. Any and all fees and commissions, exclusive of Acquisition Expenses but
including the Acquisition and Advisory Fees, paid by any Person to any other Person (including any
fees or commissions paid by or to any Affiliate of the Company or the Advisor) in connection with
making or investing in Mortgages or the purchase, development or construction of an Asset,
including, without limitation, real estate commissions, selection fees, Development Fees,
Construction Fees, non-recurring management fees, loan fees, points or any other fees of a similar
nature. Excluded shall be Development Fees and Construction Fees paid to any Person not affiliated
with the Sponsor in connection with the actual development and construction of any Property.

 

 

Acquisition and Advisory Fees. The fees payable to the Advisor pursuant to Section 3.01(b)
of this Agreement.

Advisor.
Cole REIT Advisors III, LLC, a Delaware limited liability company, any
successor advisor to the Company, or any Person to which Cole REIT
Advisors III, LLC, or any
successor advisor subcontracts all or substantially all of its functions.

Affiliate or Affiliated. As to any Person, (i) any Person directly or indirectly
owning, controlling, or holding, with the power to vote, 10% or more of the outstanding voting
securities of such Person; (ii) any Person 10% 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
Person; (iv) any executive officer, director, trustee or general partner of such Person; and (v)
any legal entity for which such Person acts as an executive officer, director, trustee or general
partner.

Aggregate Assets Value. The aggregate book value of the Assets at the time of measurement
before deducting depreciation, bad debts or other similar non-cash reserves and without reduction
for any debt secured by or relating to such assets; provided, however, that during such periods in
which the Board is determining on a regular basis the current value of the Company’s net assets for
purposes of enabling fiduciaries of employee benefit plan stockholders to comply with applicable
Department of Labor reporting requirements, “Aggregate Assets Value” will equal the greater of (i)
the amount determined pursuant to the foregoing or (ii) the most recent Assets’ aggregate valuation
established by the Board without reduction for depreciation, bad debts or other non-cash reserves
and without reduction for any debt secured by or relating to such assets.

Appraised Value. Value according to an appraisal made by an Independent Appraiser.

Articles of Incorporation. The Articles of Incorporation of the Company filed with the
Maryland State Department of Assessments and Taxation in accordance with the Maryland General
Corporation Law, as amended from time to time.

Assets. Properties, Mortgages and other direct or indirect investments in equity interests
in, or loans secured by, Real Property (other than investments in bank accounts, money market funds
or other current assets, whether of the proceeds from an Offering or the sale of an Asset or
otherwise) owned by the Company, directly or indirectly through one or more of its Affiliates.

Asset Management Fee. The fee payable to the Advisor for day-to-day professional
management services in connection with the Company and its investments in Assets pursuant to this
Agreement.

Average Invested Assets. For a specified period, the average of the aggregate book value
of the Assets, before deducting depreciation, bad debts or other similar non-cash reserves,
computed by taking the average of such values at the end of each month during such period;
provided, however, that during such periods in which the Board is determining on a regular basis
the current value of the Company’s net assets for purposes of enabling fiduciaries of employee
benefit plan stockholders to comply with applicable Department of Labor reporting requirements,
“Average Invested Assets” will equal the greater of (i) the amount determined pursuant to the
foregoing or (ii) the most recent Assets’ aggregate valuation established by the Board without
reduction for depreciation, bad debts or other non-cash reserves.

Board. The Board of Directors of the Company.

Bylaws. The bylaws of the Company, as the same are in effect as amended from time to time.

-2-

 

Change of Control. Any event (including, without limitation, issue, transfer or other
disposition of Shares of capital stock of the Company or equity interests in the Partnership,
merger, share exchange or consolidation) after which any “person” (as that term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) is or becomes the “beneficial
owner” (as defined in Rule 13d-j of the Securities Exchange Act of 1934, as amended), directly or
indirectly, of securities of the Company or the Partnership representing greater than 50% or more
of the combined voting power of the Company’s or the Partnership’s then outstanding securities,
respectively; provided, that, a Change of Control shall not be deemed to occur as a result of any
widely distributed public offering of the Shares.

Code. Internal Revenue Code of 1986, as amended from time to time, or any successor
statute thereto. Reference to any provision of the Code shall mean such provision as in effect from
time to time, as the same may be amended, and any successor provision thereto, as interpreted by
any applicable regulations as in effect from time to time.

Company.
Cole Credit Property Trust III, Inc., a corporation organized under the laws of the
State of Maryland.

Competitive Real Estate Commission. A real estate or brokerage commission paid or, if no
such commission is paid, the amount that customarily would be paid, for the purchase or sale of a
Property which is reasonable, customary, and competitive in light of the size, type and location of
the Property.

Construction Fee. A fee or other remuneration for acting as general contractor and/or
construction manager to construct improvements, supervise and coordinate projects or to provide
major repairs or rehabilitations on a Property.

Contract Purchase Price. The amount actually paid or allocated in respect of the purchase,
development, construction or improvement of an Asset, or the amount of funds advanced with respect
to a Mortgage, exclusive of Acquisition Fees and Acquisition Expenses.

Contract Sales Price. The total consideration provided for in the sales contract for the
sale of a Property.

Dealer Manager. Cole Capital Corporation, an Affiliate of the Advisor, or such Person
selected by the Board to act as the dealer manager for an Offering.

Development Fee. A fee for the packaging of a Property or Mortgage, including the
negotiation and approval of plans, and any assistance in obtaining zoning and necessary variances
and financing for a specific Property, either initially or at a later date.

Director. A member of the Board of Directors.

Dividends. Any dividends or other distributions of money or other property by the Company
to owners of Shares, including distributions that may constitute a return of capital for federal
income tax purposes.

Finance Coordination Fee. The fees payable to the Advisor pursuant to Section 3.01(g) of
this Agreement.

Gross Proceeds. The aggregate purchase price of all Shares sold for the account of the
Company through an Offering, without deduction for Selling Commissions, volume discounts, dealer
manager fees, or Organization and Offering Expenses. For the purpose of computing Gross Proceeds,
the purchase price of any Share for which reduced Selling Commissions or dealer manager fees are
paid to the Dealer Manager or a Soliciting Dealer (where net proceeds to the Company are not
reduced) shall be deemed to

-3-

 

be the full amount of the Offering price per Share pursuant to the prospectus for such Offering
without reduction.

Independent Appraiser. A Person with no material current or prior business or personal
relationship with the Advisor or the Directors and who is a qualified appraiser of Real Property of
the type held by the Company or of other Assets as determined by the Board. 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 as to Real
Property.

Independent Director. A Director who is not; on the date of determination and within the
last two years from the date of determination has not been, directly or indirectly associated with
the Sponsor, the Company, the Advisor or any of their Affiliates by virtue of (i) ownership of an
interest in the Sponsor, the Company, the Advisor or any of their Affiliates, other than the
Company, (ii) employment by the Sponsor, the Advisor or any of their Affiliates, (iii) service as
an officer or director of the Sponsor, the Advisor or any of their Affiliates, other than as a
Director of the Company, or of any other real estate investment trust organized by the
Sponsor or advised by the Advisor, (iv) performance of services, other than as a Director of the Company, (v)
service as a director or trustee of more than three real estate investment trusts organized by the
Sponsor or advised by the Advisor,  or (vi) maintenance of a material business or professional
relationship with the Sponsor, the Advisor or any of their Affiliates. A business or professional
relationship is considered material if the aggregate gross revenue derived by the Director from the
Sponsor, the Advisor and their Affiliates exceeds 5.0% of either the Director’s annual gross income
during either of the last two years or the Director’s net worth on a fair market value basis. An
indirect association with the Sponsor or the Advisor shall include circumstances in which a
Director’s spouse, parent, child, sibling, mother- or father-in-law, son- or daughter-in-law, or
brother- or sister-in-law is or has been associated with the Sponsor, the Advisor, any of their
Affiliates, or the Company.

Invested Capital. The amount calculated by multiplying the total number of Shares
purchased by Stockholders by the issue price, reduced by the portion of any Dividend that is
attributable to Net Sales Proceeds and by any amounts paid by the Company to repurchase Shares
pursuant to the Company’s plan for repurchase of Shares.

Joint Ventures. The joint venture or partnership arrangements in which the Company or the
Partnership is a co-venturer or general partner which are established to acquire or hold Assets.

Listing or Listed. The listing of the Shares on a national securities exchange or the
quotation of Shares on The Nasdaq National Market. Upon such Listing, the Shares shall be deemed
Listed.

Market Value. Upon Listing, the market value of the outstanding Shares, measured by taking
the average closing price or average of bid and asked price, as the case may be, over a period of
30 days during which the Shares are traded, with such period beginning 180 days after Listing.

Mortgages. In connection with mortgage financing provided, invested in or purchased by the
Company, all of the notes, deeds of trust, security interests or other evidences of indebtedness or
obligations, which are secured or collateralized by Real Property owned by the borrowers under such
notes, deeds of trust, security interests or other evidences of indebtedness or obligations.

NASAA Guidelines. The Statement of Policy Regarding Real Estate Investment Trusts of the
North American Securities Administrators Association, Inc.

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Net Income. For any period, the Company’s total revenues applicable to such period, less
the total expenses applicable to such period other than additions to reserves for depreciation, bad
debts or other similar non-cash reserves and excluding any gain from the sale of the Assets.

Net Sales Proceeds. In the case of a transaction described in clause (A) of the definition
of Sale, the proceeds of any such transaction less the amount of selling expenses incurred by or on
behalf of the Company, including all real estate commissions, closing costs and legal fees and
expenses. In the case of a transaction described in clause (B) of such definition, Net Sales
Proceeds means the proceeds of any such transaction less the amount of selling expenses incurred by
or on behalf of the Company, including any legal fees and expenses and other selling expenses
incurred in connection with such transaction. In the case of a transaction described in clause (C)
of such definition, Net Sales Proceeds means the proceeds of any such transaction actually
distributed to the Company from the Joint Venture less the amount of any selling expenses,
including legal fees and expenses incurred by or on behalf of the Company (other than those paid by
the Joint Venture). In the case of a transaction or series of transactions described in clause (D)
of the definition of Sale, Net Sales Proceeds means the proceeds of any such transaction (including
the aggregate of all payments under a Mortgage or in satisfaction thereof other than regularly
scheduled interest payments) less the amount of selling expenses incurred by or on behalf of the
Company, including all commissions, closing costs and legal fees and expenses. In the case of a
transaction described in clause (E) of such definition, Net Sales Proceeds means the proceeds of
any such transaction less the amount of selling expenses incurred by or on behalf of the Company,
including any legal fees and expenses and other selling expenses incurred in connection with such
transaction. In the case of a transaction described in the last sentence of the definition of Sale,
Net Sales Proceeds means the proceeds of such transaction or series of transactions less all
amounts generated thereby which are reinvested in one or more Assets within 180 days thereafter and
less the amount of any real estate commissions, closing costs, and legal fees and expenses and
other selling expenses incurred by or allocated to the Company in connection with such transaction
or series of transactions. Net Sales Proceeds shall also include any consideration (including
non-cash consideration such as stock, notes, or other property or securities) that the Company
determines, in its discretion, to be economically equivalent to proceeds of a Sale, valued in the
reasonable determination of the Company. Net Sales Proceeds shall not include any reserves
established by the Company in its sole discretion.

Offering. Any public offering and sale of Shares pursuant to an effective registration
statement filed under the Securities Act, excluding Shares offered under any employee benefit plan.

Operating Expenses. All costs and expenses paid or incurred by the Company, as determined
under generally accepted accounting principles, which are in any way related to the operation of
the Company or to Company business, including the Asset Management Fee, but excluding (i) the
expenses of raising capital such as Organization and Offering Expenses, legal, audit, accounting,
underwriting, brokerage, listing, registration, and other fees, printing and other such expenses
and tax incurred in connection with the issuance, distribution, transfer, registration and Listing
of the Shares, (ii) interest payments, (iii) taxes, (iv) non-cash expenditures such as
depreciation, amortization and bad debt reserves, (v) the Subordinated Share of Net Sales Proceeds,
(vi) the Performance Fee, (vii) the Subordinated Incentive Listing Fee, (viii) Acquisition Fees and
Acquisition Expenses, (ix) real estate commissions on the Sale of Property, and (x) other fees and
expenses connected with the acquisition, disposition, management and ownership of real estate
interests, mortgage loans or other property (including the costs of foreclosure, insurance
premiums, legal services, maintenance, repair and improvement of property).

Organization and Offering Expenses. All expenses incurred by, and to be paid from, the
assets of the Company in connection with and in preparing the Company for registration of and
subsequently offering and distributing its Shares to the public, which may include, but are not
limited to, total underwriting and brokerage discounts and commissions (including fees of the
underwriters’ attorneys); expenses for

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printing, engraving and mailing; salaries of employees while engaged in sales activities; charges
of transfer agents, registrars, trustees, escrow holders, depositaries and experts; and expenses of
qualification of the sale of the securities under federal and state laws, including taxes and fees,
accountants’ and attorneys’ fees.

Partnership. Cole REIT III Operating Partnership, LP, a Delaware limited partnership, through which
the Company may own Assets.

Performance Fee. The fee payable to the Advisor upon termination of this Agreement under
certain circumstances if certain performance standards have been met pursuant to Section 4.03(b) or
(c) of this Agreement.

Person. An individual, corporation, business trust, estate, trust, partnership, limited
liability company or other legal entity.

Property or Properties. As the context requires, any, or all, respectively, of the
Real Property acquired by the Company, either directly or indirectly (whether through joint venture
arrangements or other partnership or investment interests).

Prospectus. Prospectus has the meaning set forth in Section 2(10) of the Securities Act,
including a preliminary prospectus, an offering circular as described in Rule 256 of the General
Rules and Regulations under the Securities Act or, in the case of an intrastate offering, any
document by whatever name known, utilized for the purpose of offering and selling securities of the
Company to the public.

Real Estate Commission. The fee payable to the Advisor for services provided in connection
with the Sale of one or more Properties pursuant to Section 3.01(c).

Real Property. Land, rights in land (including leasehold interests), and any buildings,
structures, improvements, furnishings, fixtures and equipment located on or used in connection with
land and rights or interests in land.

REIT. A corporation, trust, association or other legal entity (other than a real estate
syndication) that is engaged primarily in investing in equity interests in real estate (including
fee ownership and leasehold interests) or in loans secured by real estate or both in accordance
with Sections 856 through 860 of the Code.

Sale or Sales. Any transaction or series of transactions whereby: (A) the Company
or the Partnership directly or indirectly (except as described in other subsections of this
definition) sells, grants, transfers, conveys, or relinquishes its ownership of any Property or
portion thereof, including the lease of any Property consisting of a building only, and including
any event with respect to any Property which gives rise to a significant amount of insurance
proceeds or condemnation awards; (B) the Company or the Partnership directly or indirectly (except
as described in other subsections of this definition) sells, grants, transfers, conveys, or
relinquishes its ownership of all or substantially all of the interest of the Company or the
Partnership in any Joint Venture in which it is a co-venturer or partner; (C) any Joint Venture
directly or indirectly (except as described in other subsections of this definition) in which the
Company or the Partnership as a co-venturer or partner sells, grants, transfers, conveys, or
relinquishes its ownership of any Property or portion thereof, including any event with respect to
any Property which gives rise to insurance claims or condemnation awards; (D) the Company or the
Partnership directly or indirectly (except as described in other subsections of this definition)
sells, grants, conveys or relinquishes its interest in any Mortgage or portion thereof (including
with respect to any Mortgage, all repayments thereunder or in satisfaction thereof other than
regularly scheduled interest payments) and any event with

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respect to a Mortgage which gives rise to a significant amount of insurance proceeds or similar
awards; or (E) the Company or the Partnership directly or indirectly (except as described in other
subsections of this definition) sells, grants, transfers, conveys, or relinquishes its ownership of
any other Asset not previously described in this definition or any portion thereof.
Notwithstanding the foregoing, “Sale” or “Sales” shall not include any transaction or series of
transactions specified in clause (A) through (E) above in which the proceeds of such transaction or
series of transactions are reinvested in one or more Assets within 180 days thereafter.

Securities Act. The Securities Act of 1933, as amended from time to time, or any successor
statute thereto. Reference to any provision of the Securities Act shall mean such provision as in
effect from time to time, as the same may be amended, and any successor provision thereto, as
interpreted by any applicable regulations as in effect from time to time.

Selling Commissions. Any and all commissions payable to underwriters, dealer managers or
other broker-dealers in connection with the sale of the Shares, including, without limitation,
commissions payable to Cole Capital Corporation.

Shares. Any Shares of the Company’s common stock, par value $.01 per share.

Soliciting Dealers. Broker-dealers who are members of the Financial Industry Regulatory
Authority, Inc., or that are exempt from broker-dealer registration, and who, in either case, have
executed participating broker or other agreements with the Dealer Manager to sell Shares.

Sponsor. Cole Holdings Corporation.

Stockholders. The record holders of the Shares as maintained in the books and records of
the Company or its transfer agent.

Stockholders’
8.0% Return. As of any date, an aggregate amount equal to an 8.0%
cumulative, noncompounded, annual return on Invested Capital.

Subordinated Incentive Listing Fee. The fee payable to the Advisor under certain
circumstances if the Shares are Listed pursuant to Section 3.01(e).

Subordinated Share of Net Sales Proceeds. The fee payable to the Advisor under certain
circumstances following receipt of Net Sales Proceeds pursuant to Section 3.01(d).

Termination Date. The date of termination of this Agreement.

2%/25% Guidelines. The requirement pursuant to the Statement of Policy Regarding Real
Estate Investment Trusts of the North American Securities Administrators Association, Inc. that, in
any 12 month period, total Operating Expenses not exceed the greater of 2% of Average Invested
Assets during such 12 month period or 25% of Net Income over the same 12 month period.

ARTICLE II

THE ADVISOR

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

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2.02 Duties of the Advisor. The Advisor undertakes to use its commercially reasonable best
efforts to present to the Company potential investment opportunities and to provide a continuing
and suitable investment program consistent with the investment objectives and policies of the
Company as determined and adopted from time to time by the Board. In performance of this
undertaking, subject to the supervision of the Board and consistent with the provisions of the
Company’s most recent Prospectus for Shares, Articles of Incorporation and Bylaws, the Advisor
shall, either directly or by engaging an Affiliate of the Advisor or other Person:

     (a) serve as the Company’s investment and financial advisor and provide research and economic
and statistical data in connection with the Assets and the Company’s investment policies;

     (b) provide the daily management of the Company and perform and supervise the various
administrative functions reasonably necessary for the management and operations of the Company;

     (c) maintain and preserve the books and records of the Company, including stock books and
records reflecting a record of the Stockholders and their ownership of the Company’s uncertificated
Shares, if any, and acting as transfer agent for the Shares;

     (d) investigate, select, and, on behalf of the Company, engage and conduct business with such
Persons as the Advisor deems necessary to the proper performance of its obligations hereunder,
including but not limited to consultants, accountants, correspondents, lenders, technical advisors,
attorneys, brokers, underwriters, corporate fiduciaries, escrow agents, depositaries, custodians,
agents for collection, insurers, insurance agents, banks, builders, developers, property owners,
mortgagors, property management companies, transfer agents and any and all agents for any of the
foregoing, including Affiliates of the Advisor, and Persons acting in any other capacity deemed by
the Advisor necessary or desirable for the performance of any of the foregoing services, including
but not limited to entering into contracts in the name of the Company with any of the foregoing;

     (e) consult with the officers and the Board and assist the Board in the formulation and
implementation of the Company’s financial policies, and, as necessary, furnish the Board with
advice and recommendations with respect to the making of investments consistent with the investment
objectives and policies of the Company and in connection with any borrowings proposed to be
undertaken by the Company;

     (f) subject to the provisions of Sections 2.02(i) and 2.03 hereof, (i) locate, analyze and
select potential investments in Assets, (ii) structure and negotiate the terms and conditions of
transactions pursuant to which investment in Assets will be made; (iii) make investments in Assets
on behalf of the Company or the Partnership in compliance with the investment objectives and
policies of the Company; (iv) arrange for financing and refinancing and make other changes in the
asset or capital structure of, and dispose of, reinvest the proceeds from the sale of, or otherwise
deal with the investments in, Assets; and (v) enter into leases of Property and service contracts
for Assets and, to the extent necessary, perform all other operational functions for the
maintenance and administration of such Assets, including the servicing of Mortgages;

     (g) provide the Board with periodic reports regarding prospective investments in Assets;

     (h) if a transaction requires approval by the Board, deliver to the Board all documents
required by them to properly evaluate the proposed transaction;

     (i) obtain the prior approval of the Board (including a majority of all Independent Directors)
for any and all investments in Assets;

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     (j) obtain the prior approval of a majority of the Independent Directors and a majority of the
Board not otherwise interested in any transaction with the Advisor or its Affiliates;

     (k) negotiate on behalf of the Company with banks or lenders for loans to be made to the
Company, negotiate on behalf of the Company with investment banking firms and broker-dealers, and
negotiate private sales of Shares and other securities of the Company or obtain loans for the
Company, as and when appropriate, but in no event in such a way so that the Advisor shall be acting
as broker-dealer or underwriter; and provided, further, that any fees and costs payable to third
parties incurred by the Advisor in connection with the foregoing shall be the responsibility of the
Company;

     (l) obtain reports (which may be prepared by or for the Advisor or its Affiliates), where
appropriate, concerning the value of investments or contemplated investments of the Company in
Assets;

     (m) from time to time, or at any time reasonably requested by the Board, make reports to the
Board of its performance of services to the Company under this Agreement;

     (n) provide the Company with all necessary cash management services;

     (o) deliver to or maintain on behalf of the Company copies of all appraisals obtained in
connection with the investments in Assets;

     (p) upon request of the Company, act, or obtain the services of others to act, as
attorney-in-fact or agent of the Company in making, requiring and disposing of Assets, disbursing,
and collecting the funds, paying the debts and fulfilling the obligations of the Company and
handling, prosecuting and settling any claims of the Company, including foreclosing and otherwise
enforcing mortgage and other liens and security interests comprising any of the Assets;

     (q) supervise the preparation and filing and distribution of returns and reports to
governmental agencies and to Stockholders and other investors and act on behalf of the Company in
connection with investor relations;

     (r) provide office space, equipment and personnel as required for the performance of the
foregoing services as Advisor;

     (s) prepare on behalf of the Company all reports and returns required by the Securities and
Exchange Commission, Internal Revenue Service and other state or federal governmental agencies; and

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

2.03 Modification or Revocation of Authority of Advisor. The Board may, at any time upon
the giving of notice to the Advisor, modify or revoke the authority set forth in Section 2.02,
provided however, that such modification or revocation shall be effective upon receipt by the
Advisor or such later date as is specified by the Board and included in the notice provided to the
Company and such modification or revocation shall not be applicable to investment transactions to
which the Advisor has committed the Company prior to the date of receipt by the Advisor of such
notification, or, if later, the effective date of such modification or revocation specified by the
Board.

2.04 Bank Accounts. The Advisor may establish and maintain one or more bank accounts in
its own name 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

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the Company, under such terms and conditions as the Board may approve, provided that no funds shall
be commingled with the funds of the Advisor; and the Advisor shall from time to time, upon request
by the Board, its Audit Committee or the auditors of the Company, render appropriate accountings of
such collections and payments to the Board, its Audit Committee and the auditors of the Company.

2.05 Records; Access. The Advisor 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, upon reasonable request, during
normal business hours. The Advisor shall at all reasonable times have access to the books and
records of the Company.

2.06 Limitations on Activities. Anything else in this Agreement to the contrary
notwithstanding, the Advisor shall refrain from taking any action which, in its sole judgment made
in good faith, would (a) adversely affect the status of the Company as a REIT, (b) subject the
Company to regulation under the Investment Company Act of 1940, as amended, (c) violate any law,
rule, regulation or statement of policy of any governmental body or agency having jurisdiction over
the Company, the Shares or its other securities, or (d) not be permitted by the Articles of
Incorporation or Bylaws, except if such action shall be ordered by the Board, in which case the
Advisor shall notify promptly the Board of the Advisor’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 Advisor shall have no liability for acting in
accordance with the specific instructions of the Board so given. Notwithstanding the foregoing,
the Advisor, its directors, officers, employees and stockholders, and the directors, officers,
employees and stockholders of the Advisor’s Affiliates shall not be liable to the Company or to the
Board or Stockholders for any act or omission by the Advisor, its directors, officers, employees or
stockholders, or for any act or omission of any Affiliate of the Advisor, its directors, officers,
employees or stockholders, except as provided in Article V of this Agreement.

2.07 Other Activities of the Advisor. Nothing herein contained shall prevent the Advisor
or its Affiliates from engaging in other activities, including, without limitation, the rendering
of advice to other Persons (including other REITs) and the management of other programs advised,
sponsored or organized by the Advisor or its Affiliates; nor shall this Agreement limit or restrict
the right of any director, officer, employee, or stockholder of the Advisor or its Affiliates to
engage in any other business or to render services of any kind to any other Person. The Advisor
may, with respect to any investment in which the Company is a participant, also render advice and
service to each and every other participant therein. The Advisor shall report to the Board the
existence of any condition or circumstance, existing or anticipated, of which it has knowledge,
which creates or could create a conflict of interest between the Advisor’s obligations to the
Company and its obligations to or its interest in any other Person. The Advisor or its Affiliates
shall promptly disclose to the Board knowledge of such condition or circumstance. If the Sponsor,
Advisor, any Director or Affiliates thereof have sponsored other investment programs with similar
investment objectives which have investment funds available at the same time as the Company, it
shall be the duty of the Board (including the Independent Directors) to adopt the method set forth
in the Company’s most recent Prospectus for its Shares or another reasonable method by which
investments are to be allocated to the competing investment entities and to use their best efforts
to apply such method fairly to the Company.

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ARTICLE III

COMPENSATION

3.01 Fees.

     (a) Asset Management Fee. The Company shall pay the Advisor a monthly Asset
Management Fee equal to 0.0417%, which is one twelfth of 0.50 of the Aggregate Asset Value, plus
costs and expenses incurred by the Advisor in providing asset management services on the last day
of each month.

     (b) Acquisition and Advisory Fees. The Company shall pay the Advisor, or an
Affiliate, a fee in the amount of 2.0% of the Contract Purchase Price of each Asset as Acquisition
and Advisory Fees payable at the time and in respect of funds expended for (i) the acquisition of
an Asset, (ii) to the extent that such funds are capitalized, for the development, construction or
improvement of an Asset, or (iii) the making of a Mortgage. The total of all Acquisition Fees and
any Acquisition Expenses shall be limited in accordance with the Articles of Incorporation.

     (c) Real Estate Commission. If the Advisor or an Affiliate provides a substantial
amount of the services (as determined by a majority of the Independent Directors) in connection
with the Sale of one or more Properties, the Advisor or such Affiliate shall receive a Real Estate
Commission up to one-half of the brokerage commission paid, but in no event an amount to exceed 3%
of the Contact Sales Price of such Property or Properties; provided, however, that no Real Estate
Commissions shall be payable to the Advisor for the Sale of Properties if such Sales involve the
Company selling all or substantially all of its Properties in one or more transactions designed to
effectuate a business combination transaction (as opposed to a Company liquidation, in which case
the Real Estate Commissions would be payable if the Advisor or an Affiliate provides a substantial
amount of services as provided above). The Real Estate Commission may be paid in addition to real
estate commissions paid to non-Affiliates, provided that the total real estate commissions paid to
all Persons by the Company (including the Real Estate Commission) shall not exceed an amount equal
to the lesser of (i) 6.0% of the Contract Sales Price of a Property.

     (d) Subordinated Share of Net Sales Proceeds. The Subordinated Share of Net Sales
Proceeds shall be payable to the Advisor in an amount equal to 15.0% of Net Sales Proceeds
remaining after the Stockholders have received Dividends equal to the
sum of the Stockholders’ 8.0%
Return and 100% of Invested Capital. The Company shall have the option to pay such fee in the form
of cash, Shares, a promissory note, or any combination of the foregoing, or any combination of the
foregoing.

     (e) Subordinated Incentive Listing Fee. Upon Listing, the Advisor shall be entitled
to the Subordinated Incentive Listing Fee in an amount equal to 15.0% of the amount by which (i)
the Market Value of the Company’s outstanding Shares plus distributions paid by the Company prior
to Listing, exceeds (ii) the sum of (A) 100% of Invested Capital and (B) the total Dividends
required to be paid to the Stockholders in order to pay the
Stockholders’ 8.0% Return from
inception through the date that Market Value is determined. The Company shall have the option to
pay such fee in the form of cash, Shares, a promissory note, or any combination of the foregoing.
If the Company pays such fee with a promissory note, payment in full shall be made from the Net
Sales Proceeds of the first Sale completed by the Company after Listing, and interest will accrue
at a rate deemed fair and reasonable by the Board from and after the date of Listing. If the Net
Sales Proceeds from the first Sale after Listing are insufficient to pay the promissory note in
full, including accrued interest, then the promissory note shall be paid in part with such Net
Sales Proceeds, and in part from the Net Sales Proceeds from the next successive Sales until the
amount owing pursuant to such promissory note is paid in full. If the promissory note has not been
paid in full within five years from the date of Listing, then the Advisor, or

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its successors or assigns, may elect to convert the unpaid balance, including accrued but
unpaid interest, into Shares at a price per Share equal to the average closing price of the Shares
over the ten trading days immediately preceding the date of such election. If the Shares are no
longer Listed at such time as the promissory note becomes convertible into Shares as provided by
this paragraph, then the price per Share, for purposes of conversion, shall equal the fair market
value for the Shares as determined by the Board based upon the Appraised Value of the Assets as of
the date of election.

     (f) Changes to Fee Structure. In the event of Listing, the Company and the Advisor
shall negotiate in good faith to establish a fee structure appropriate for a perpetual-life entity.

     (g) Finance Coordination Fee. In the event of the origination or refinancing of any
debt financing obtained by the Company, including the assumption (directly or indirectly) of
existing debt, that is used to acquire properties, to make other permitted investments or is
assumed (directly or indirectly) in connection with the acquisition of properties, and if the
Advisor provides a substantial amount of services, as determined by the Independent Directors in
connection therewith, the Company will pay to the Advisor a financing coordination fee equal to 1%
of the amount available and/or outstanding under such financing; provided, however, that the
Advisor shall not be entitled to a Finance Coordination Fee in connection with the refinancing of
any loan secured by any particular property that was previously subject to a refinancing in which
the Advisor received a Finance Coordination Fee. Finance Coordination Fees payable from loan
proceeds from permanent financing will be paid to the Advisor as the Company acquires such
permanent financing, however, no Financing Coordination Fees will be paid from loan proceeds from any
line of credit until such time as all net offering proceeds received
as of the date proceeds from the line of credit are drawn for the
purpose of acquiring properties or other permitted investments (other
than reasonable working capital reserves) have been invested by the
Company. In addition, with respect to any revolving line of credit,
our Advisor will receive a Financing Coordination Fee only in
connection with amounts being drawn for the first time and not upon
any re-drawing of amounts that previously were repaid by us.

3.02 Expenses.

     (a) In addition to the compensation paid to the Advisor pursuant to Section 3.01 hereof, the
Company shall pay directly or reimburse the Advisor, as applicable, for all of the expenses paid or
incurred by the Advisor in connection with the services it provides to the Company pursuant to this
Agreement, including, but not limited to:

(i) Organization and Offering Expenses; provided, however, that within 60 days after
the end of the month in which an Offering terminates, the Advisor shall reimburse
the Company for any Organization and Offering Expenses reimbursed by the Company to
the Advisor to the extent that such reimbursement exceeds 1.5% of the Gross Proceeds
raised in a completed Offering. The Advisor shall be responsible for the payment of
Organization and Offering Expenses in excess of 1.5% of the Gross Proceeds;

(ii) Acquisition Expenses incurred in connection with the selection and acquisition
of Assets in an amount estimated to be up to 0.5% of the Contract Purchase Price;

(iii) the actual cost of goods, services and materials used by the Company and
obtained from Persons not affiliated with the Advisor, other than Acquisition
Expenses, including brokerage fees paid in connection with the purchase and sale of
Shares;

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

(v) taxes and assessments on income or property and taxes as an expense of doing
business;

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(vi) costs associated with insurance required in connection with the business of the
Company or by the Board;

(vii) expenses of managing and operating Assets owned by the Company, whether
payable to an Affiliate of the Company or a non-affiliated Person;

(viii) all expenses in connection with payments to the Board for attendance at
meetings of the Board and Stockholders;

(ix) expenses associated with Listing or with the issuance and distribution of
Shares and other securities of the Company, such as Selling Commissions and fees,
advertising expenses, taxes, legal and accounting fees, Listing and registration
fees, and other Organization and Offering Expenses;

(x) expenses connected with payments of Dividends in cash or otherwise made or
caused to be made by the Company to the Stockholders;

(xi) expenses of organizing, revising, amending, converting, modifying or
terminating the Company or amending the Articles of Incorporation or the Bylaws;

(xii) expenses of any third party transfer agent for the Shares and of maintaining
communications with Stockholders, including the cost of preparation, printing, and
mailing annual reports and other Stockholder reports, proxy statements and other
reports required by governmental entities;

(xiii) administrative service expenses, including all costs and expenses incurred by
Advisor in fulfilling its duties hereunder. Such costs and expenses may include
reasonable wages and salaries and other employee-related expenses of all employees
of Advisor who are engage in the management, administration, operations, and
marketing of the Company, including taxes, insurance and benefits relating to such
employees, and legal, travel and other out-of-pocket expenses which are directly
related to their services provided hereunder; and

(xiv) audit, accounting and legal fees.

     No reimbursement shall be made for costs of personnel of the Advisor or its Affiliates to the
extent that such personnel perform services in connection with services for which the Advisor
receives the Acquisition and Advisory Fee or the Real Estate Commission.

     (b) Expenses incurred by the Advisor on behalf of the Company and payable pursuant to this
Section 3.02 shall be reimbursed no less than quarterly to the Advisor within 60 days after the end
of each quarter. The Advisor shall prepare a statement documenting the expenses of the Company
during each quarter, and shall deliver such statement to the Company within 45 days after the end
of each quarter.

3.03 Other Services. Should the Board request that the Advisor or any director, officer or
employee thereof render services for the Company other than set forth in Section 2.02, such
services shall be separately compensated at such rates and in such amounts as are agreed by the
Advisor and the Board, subject to the limitations contained in the Articles of Incorporation, and
shall not be deemed to be services pursuant to the terms of this Agreement.

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3.04 Reimbursement to the Advisor. The Company shall not reimburse the Advisor, at the end
of any fiscal quarter, for any Operating Expenses to the extent that, in the four consecutive
fiscal quarters then ended (the “Expense Year”) the Operating Expenses exceed (the “Excess Amount”)
the greater of (i) 2% of Average Invested Assets or (ii) 25% of Net Income (the “2%/25%
Guidelines”) for such year unless the Independent Directors determine that such excess was
justified, based on unusual and nonrecurring factors which the Independent Directors deem
sufficient. If the Independent Directors do not approve such excess as being so justified, any
Excess Amount paid to the Advisor during a fiscal quarter shall be repaid to the Company. If the
Independent Directors determine such excess was justified, then within 60 days after the end of any
fiscal quarter of the Company for which total reimbursed Operating Expenses for the Expense Year
exceed the 2%/25% Guidelines, the Advisor, at the direction of the Independent Directors, shall
send to the stockholders a written disclosure of such fact, together with an explanation of the
factors the Independent Directors considered in determining that such excess expenses were
justified. The Company will ensure that such determination will be reflected in the minutes of the
meetings of the Board. All figures used in the foregoing computation shall be determined in
accordance with generally accepted accounting principles applied on a consistent basis.

ARTICLE IV

TERM AND TERMINATION

4.01 Term; Renewal. Subject to Section 4.02 hereof, this Agreement has a one-year term and
shall continue in force until [                    , 2009]. Thereafter, this Agreement may be renewed
for an unlimited number of successive one-year terms upon mutual consent of the parties. It is the
Board’s Duty to evaluate the performance of the Advisor annually before renewing the Agreement, and
each such renewal shall be for a term of no more than one year.

4.02 Termination. This Agreement will automatically terminate upon Listing. This
Agreement also may be terminated at the option of either party (i) immediately upon a Change of
Control or (ii) upon 60 days written notice without cause or penalty, by either party (in either
case, if termination is by the Company, then such termination shall be upon the approval of a
majority of the Independent Directors). Notwithstanding the foregoing, the provisions of this
Agreement which provide for payment to the Advisor of expenses, fees or other compensation
following the date of termination (i.e., Sections 3.01(e) and 4.03) shall continue in full force
and effect until all amounts payable thereunder to the Advisor are paid in full. The provisions of
Sections 2.05, 2.06 and 4.03 through 6.11 shall survive the termination of this Agreement.

4.03 Payments to and Duties of Advisor upon Termination.

     (a) After the Termination Date, the Advisor shall not be entitled to compensation for further
services hereunder except it shall be entitled to and receive from the Company within 30 days after
the effective date of such termination all unpaid reimbursements of expenses, subject to the
provisions of Section 3.04 hereof, and all contingent liabilities related to fees payable to the
Advisor prior to termination of this Agreement, provided that the Subordinated Incentive Listing
Fee, if any, shall be paid in accordance with the provisions of Section 3.01(e).

     (b) Upon termination, unless such termination is by the Company because of a material breach
of this Agreement by the Advisor or occurs upon a Change of Control, the Advisor shall be entitled
to receive a payment of the Performance Fee equal to 15.0% of the amount, if any, by which (i) the
Appraised Value of the Assets on the Termination Date, less the amount of all indebtedness secured
by the Assets, plus the total Dividends paid to Stockholders from the Company’s inception through
the Termination Date, exceeds (ii) Invested Capital plus an
amount equal to the Stockholders’ 8.0% Return

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from inception through the Termination Date. The Company shall pay such Performance Fee,
with interest, at such time as the Company completes the first Sale after the Termination Date.
Payment shall be made from the Net Sales Proceeds of such Sale. Interest will accrue beginning on
the Termination Date at a rate deemed fair and reasonable by the Board on the Termination Date.
The Company shall have the option to pay such fee in the form of cash, Shares, a promissory note,
or any combination of the foregoing. If the Net Sales Proceeds from the first Sale after the
Termination Date are insufficient to pay the Performance Fee in full, plus accrued interest, then
the Performance Fee shall be paid in part with such Net Sales Proceeds, and in part from the Net
Sales Proceeds from the next successive Sales until the Performance Fee is paid in full, with
interest. If the Performance Fee has not been paid in full within five years from the Termination
Date, then the Advisor, its successors or assigns, may elect to convert the balance of the fee,
including accrued but unpaid interest, into Shares at a price per Share equal to the average
closing price of the Shares over the ten trading days immediately preceding the date of such
election if the Shares are Listed at such time. If the Shares are not Listed at such time, the
Advisor, its successors or assigns, may elect to convert the balance of the fee, including accrued
but unpaid interest, into Shares at a price per Share equal to the fair market value for the Shares
as determined by the Board based upon the Appraised Value of the Assets on the date of election.

     (c) Notwithstanding the foregoing, if termination occurs upon a Change of Control, the Advisor
shall be entitled to payment of the Performance Fee equal to 15.0% of the amount, if any, by which
(i) the value of the Assets on the Termination Date as determined in good faith by the Board,
including a majority of the Independent Directors, based upon such factors as the consideration
paid in connection with the Change of Control and the most recent Appraised Value, less the amount
of all indebtedness secured by the Assets, plus the total Dividends paid to Stockholders from the
Company’s inception through the Termination Date, exceeds (ii) Invested Capital plus an amount
equal to the Stockholders’ 8.0% Return from inception through the Termination Date. No deferral of
payment of the Performance Fee may be made under this Section 4.03(c).

     (d) In the event that the Advisor disagrees with the valuation of Shares pursuant to Section
4.03(b) where the Shares are not Listed, or the value of the Successor Shares pursuant to Section
4.03(c) where the Successor Shares are not Listed, for purposes of determining the number of Shares
to be issued to the Advisor following the Advisor’s election to convert the balance of the
Performance Fee owed to the Advisor, then the fair market value of such Shares shall be determined
by an independent appraiser of equity value selected by the Advisor and the Successor. If the
Advisor and the Successor are unable to agree upon an expert independent appraiser, then each of
the Successor and the Advisor shall name one appraiser and the two named appraisers shall promptly
agree in good faith to the appointment of one such appraiser whose determination shall be final and
binding on the parties.

     (e) Notwithstanding sections 4.03 (b) and (c), in the event the Subordinated Incentive Listing
Fee is paid to the Advisor following Listing, no Performance Fee will be paid to the Advisor.

     (f) The Advisor 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;

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

(iv) cooperate with, and take all reasonable actions requested by, the Company to
provide an orderly management transition.

ARTICLE V

INDEMNIFICATION

5.01 (a) The Company shall indemnify and hold harmless the Advisor and its Affiliates, including
their respective officers, directors, partners and employees, from all liability, claims, damages
or losses arising in the performance of their duties hereunder, and related expenses, including
reasonable attorneys’ fees, to the extent such liability, claims, damages or losses and related
expenses are not fully reimbursed by insurance, subject to any limitations imposed by the laws of
the State of Maryland, the Articles of Incorporation and the NASAA Guidelines under the Articles of
Incorporation. The Company shall not indemnify or hold harmless the Advisor or its Affiliates,
including their respective officers, directors, partners and employees, for any liability or loss
suffered by the Advisor or its Affiliates, including their respective officers, directors, partners
and employees, nor shall it provide that the Advisor or its Affiliates, including their respective
officers, directors, partners and employees, be held harmless for any loss or liability suffered by
the Company, unless all of the following conditions are met: (i) the Advisor or its Affiliates,
including their respective officers, directors, partners and employees, have 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 Advisor or its Affiliates, including their respective officers, directors,
partners and employees, were acting on behalf of or performing services of the Company; (iii) such
liability or loss was not the result of negligence or misconduct by the Advisor or its Affiliates,
including their respective officers, directors, partners and employees; and (iv) such
indemnification or agreement to hold harmless is recoverable only out of the Company’s net assets
and not from Stockholders. Notwithstanding the foregoing, the Advisor and its Affiliates,
including their respective officers, directors, partners and employees, shall not be indemnified by
the Company for any losses, liability or expenses arising from or out of an alleged violation of
federal or state securities laws by such party 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;
and (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 violations of securities laws.

     (b) The Articles of Incorporation provide that the advancement of Company funds to the Advisor
or its Affiliates, including their respective officers, directors, partners and employees, for
legal expenses and other costs incurred as a result of any legal action for which indemnification
is being sought is permissible 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 Stockholder or the
legal action is initiated by a Stockholder acting in his or her capacity as such and a court of
competent jurisdiction specifically approves such advancement; (iii) the Advisor or its Affiliates,
including their respective officers, directors, partners and employees, undertake to repay the
advanced funds to the Company together with the applicable legal rate

-16-

 

of interest thereon, in cases in which such Advisor or its Affiliates, including their
respective officers, directors, partners and employees, are found not to be entitled to
indemnification.

     (c) Notwithstanding the provisions of this Section 5.01, the Advisor shall not be entitled to
indemnification or be held harmless pursuant to this Section 5.01 for any activity which the
Advisor shall be required to indemnify or hold harmless the Company pursuant to Section 5.02.

5.02 Indemnification by Advisor. The Advisor shall indemnify and hold harmless the Company
from contract or other liability, claims, damages, taxes or losses and related expenses including
attorneys’ fees, to the extent that (i) such liability, claims, damages, taxes or losses and
related expenses are not fully reimbursed by insurance and (ii) are incurred by reason of the
Advisor’s bad faith, fraud, misfeasance, misconduct, negligence or reckless disregard of its
duties. The Advisor shall not be held responsible for any action of the Board in following or
declining to follow any advice or recommendation given by the Advisor.

ARTICLE VI

MISCELLANEOUS

6.01 Assignment to an Affiliate. This Agreement may be assigned by the Advisor to an
Affiliate of the Advisor with the approval of a majority of the Board (including a majority of the
Independent Directors). The Advisor 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 Advisor, except in the case of an assignment by the
Company to a corporation or other organization which is a successor to all of the assets, rights
and obligations of 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.
This Agreement shall be binding on successors to the Company resulting from a Change of Control or
sale of all or substantially all the assets of the Company or the Partnership, and shall likewise
be binding upon any successor to the Advisor.

6.02 Relationship of Advisor and Company. The Company and the Advisor are not partners or
joint venturers with each other, and nothing in this Agreement shall be construed to make them such
partners or joint venturers or impose any liability as such on either of them.

6.03 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 required by the Articles of Incorporation, the Bylaws, or 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 Directors and to the Company:

	 	Cole Credit Property Trust III, Inc.
	 

	 	2555 E. Camelback Road, Suite 400
	 

	 	Phoenix, Arizona 85016
	 

	 	Attention: Chief Executive Officer and President
	 
	 	 
	To the Advisor:

	 	Cole REIT Advisors III, LLC
	 

	 	2555 E. Camelback Road, Suite 400
	 

	 	Phoenix, Arizona 85016
	 

	 	Attention: Chief Executive Officer and President

-17-

 

Either party shall, as soon as reasonably practicable, give notice in writing to the other party of
a change in its address for the purposes of this Section 6.03.

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

6.05 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.

6.06 Choice of Law; Venue. The provisions of this Agreement shall be construed and
interpreted in accordance with the laws of the State of Arizona, and venue for any action brought
with respect to any claims arising out of this Agreement shall be brought exclusively in Maricopa
County, Arizona.

6.07 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 signed by each of the parties hereto.

6.08 Waiver. 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.

6.09 Gender; Number. 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.

6.10 Headings. The titles and headings 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.

6.11 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 the counterparts hereof, individually or taken together, shall
bear the signatures of all of the parties reflected hereon as the signatories.

6.12 Initial Investment. The Advisor or one of its Affiliates has contributed $200,000 (the
“Initial Investment”) in exchange for the initial issuance of Shares of the Company. The Advisor
or its Affiliates may not sell any of the Shares purchased with the Initial Investment while the
Advisor acts in an advisory capacity to the Company. The restrictions included above shall not
apply to any Shares acquired by the Advisor or its Affiliates other than the Shares acquired
through the Initial Investment. Neither the Advisor nor its Affiliates shall vote any Shares they
now own, or hereafter acquires, in any vote for the

-18-

 

election of Directors or any vote regarding the approval or termination of any contract with the
Advisor or any of its Affiliates.

[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]

-19-

 

     IN WITNESS WHEREOF, the parties hereto have executed this Advisory Agreement as of the date
and year first above written.

	 	 	 	 	 
	 	COLE CREDIT PROPERTY
TRUST III, INC.

 	 
	 	By:  	 	 
	 	 	Christopher H. Cole 	 
	 	 	Chief Executive Officer and President 	 
	 
	 	COLE REIT ADVISORS III, LLC

 	 
	 	By:  	
 	 
	 	 	Christopher H. Cole 	 
	 	 	Chief Executive Officer and President 	 
	 

-20-

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