Document:

EXECUTION COPY

 

 

SECOND
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP

OF

ARC PROPERTIES OPERATING PARTNERSHIP, L.P.

(a Delaware limited partnership)

 

    	 

    	 

    

 

TABLE OF CONTENTS

 

	 	 	Page
	ARTICLE I DEFINED TERMS	2
	 	 
	ARTICLE II FORMATION OF PARTNERSHIP	22
	2.01	Formation of the Partnership	22
	2.02	Name	22
	2.03	Registered Office and Agent; Principal Office	22
	2.04	Term and Dissolution.	23
	2.05	Filing of Certificate and Perfection of Limited Partnership	24
	2.06	Certificates Describing Partnership Units	24
	 	 	 
	ARTICLE III BUSINESS OF THE PARTNERSHIP	25
	 	 
	ARTICLE IV CAPITAL CONTRIBUTIONS AND ACCOUNTS	25
	4.01	Capital Contributions	25
	4.02	Additional Capital Contributions and Issuances of Additional Partnership Units	25
	4.03	Additional Funding	29
	4.04	Capital Accounts	29
	4.05	Percentage Interests	29
	4.06	No Interest on Contributions	29
	4.07	Return of Capital Contributions	30
	4.08	No Third-Party Beneficiary	30
	 	 	 
	ARTICLE V NET INCOME AND NET LOSS; DISTRIBUTIONS	30
	5.01	Allocations.	30
	5.02	Distribution of Cash.	37
	5.03	REIT Distribution Requirements	40
	5.04	No Right to Distributions in Kind	40
	5.05	Limitations on Distributions	40
	5.06	Distributions Upon Liquidation.	40
	5.07	Substantial Economic Effect	41
	 	 	 
	ARTICLE VI RIGHTS, OBLIGATIONS AND POWERS OF THE GENERAL PARTNER	42
	6.01	Management of the Partnership.	42
	6.02	Delegation of Authority	45
	6.03	Indemnification and Exculpation of Indemnitees.	45
	6.04	Liability of the General Partner.	46
	6.05	Partnership Obligations.	47
	6.06	Outside Activities	48
	6.07	Employment or Retention of Affiliates.	48
	6.08	General Partner Activities	48
	6.09	Title to Partnership Assets	49
	6.10	Redemption of General Partner’s Partnership Units	49
	 	 	 

 

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	ARTICLE VII CHANGES IN GENERAL PARTNER	49
	7.01	Transfer of the General Partner’s Partnership Interest.	49
	7.02	Merger of General Partner.	50
	7.03	Admission of a Substitute or Additional General Partner	51
	7.04	Effect of Bankruptcy, Withdrawal, Death or Dissolution of General Partner.	52
	7.05	Removal of General Partner.	52
	 	 	 
	ARTICLE VIII RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS	53
	8.01	Management of the Partnership	53
	8.02	Power of Attorney	54
	8.03	Limitation on Liability of Limited Partners	54
	8.04	OP Unit Redemption Right.	54
	8.05	Registration	57
	 	 	 
	ARTICLE IX TRANSFERS OF PARTNERSHIP INTERESTS	61
	9.01	Purchase for Investment.	61
	9.02	Restrictions on Transfer of Partnership Units.	61
	9.03	Admission of Substitute Limited Partner.	63
	9.04	Rights of Assignees of Partnership Units.	64
	9.05	Effect of Bankruptcy, Death, Incompetence or Termination of a Limited Partner	64
	9.06	Joint Ownership of Partnership Units	64
	 	 	 
	ARTICLE X BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS	65
	10.01	Books and Records	65
	10.02	Custody of Partnership Funds; Bank Accounts.	65
	10.03	Fiscal and Taxable Year	65
	10.04	Annual Tax Information and Report	65
	10.05	Tax Matters Partner; Tax Elections; Special Basis Adjustments.	66
	10.06	Reports to Limited Partners.	67
	 	 	 
	ARTICLE XI AMENDMENT OF AGREEMENT; MERGER	67
	11.01	Amendment of Agreement.	67
	11.02	Merger of Partnership.	68
	 	 	 
	ARTICLE XII MANAGER’S UNITS	68
	12.01	Designation and Number	68
	12.02	Voting	68
	12.03	Distributions.	68
	12.04	Automatic Unit Conversion.	69
	12.05	Forfeiture of Manager’s Units	69
	 	 	 
	ARTICLE XIII SERIES A PREFERRED UNITS	69
	13.01	Number of Preferred Units and Designation	69
	13.02	Ranking	69
	13.03	Distributions	70

 

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	13.04	Conversion.	70
	13.05	Redemption	70
	13.06	Voting.	70
	13.07	Transfers	71
	13.08	Miscellaneous.	71
	 	 	 
	ARTICLE XIV SERIES B PREFERRED UNITS	71
	14.01	Number of Preferred Units and Designation	71
	14.02	Ranking	71
	14.03	Distributions	71
	14.04	Conversion.	72
	14.05	Redemption	72
	14.06	Voting.	72
	14.07	Transfers	73
	14.08	Miscellaneous.	73
	 	 	 
	ARTICLE XV CLASS B UNITS	73
	15.01	Designation and Number.	73
	15.02	Special Provisions	74
	15.03	Voting.	74
	15.04	Conversion of Class B Units.	75
	15.05	Profits Interests.	77
	 	 	 
	ARTICLE XVI LTIP UNITS	78
	16.01	LTIP Units.	78
	16.02	Conversion of LTIP Units.	84
	 	 	 
	ARTICLE XVII GENERAL PROVISIONS	86
	17.01	Notices	86
	17.02	Survival of Rights	86
	17.03	Additional Documents	86
	17.04	Severability	87
	17.05	Entire Agreement	87
	17.06	Pronouns and Plurals	87
	17.07	Headings	87
	17.08	Counterparts	87
	17.09	Governing Law	87

 

EXHIBITS

 

EXHIBIT A — Partners, Capital Contributions and Percentage
Interests

EXHIBIT B — Notice of Exercise of OP Unit Redemption Right

EXHIBIT C-1 — Certification of Non-Foreign Status (For
Redeeming Limited Partners That Are Entities)

EXHIBIT C-2 — Certification of Non-Foreign Status (For
Redeeming Limited Partners That Are Individuals)

EXHIBIT D — Notice of Election by Partner to Convert LTIP
Units into OP Units

EXHIBIT E — Notice of Election by Partnership to Force
Conversion of LTIP Units into OP Units

 

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SECOND AMENDED AND RESTATED AGREEMENT
OF LIMITED PARTNERSHIP

OF

ARC PROPERTIES OPERATING PARTNERSHIP, L.P.

 

RECITALS

 

THIS SECOND AMENDED AND RESTATED AGREEMENT
OF LIMITED PARTNERSHIP (this “Agreement”) of ARC PROPERTIES OPERATING PARTNERSHIP, L.P. (the “Partnership”),
dated as of February 28, 2013 is entered into among American Realty Capital Properties, Inc., a Maryland corporation (in its capacity
as general partner of the Partnership, together with its successors and permitted assigns that are admitted to Partnership as a
general partner of the Partnership in accordance with the terms hereof, the “General Partner”), Tiger Acquisition,
LLC, a Delaware limited liability company, wholly-owned subsidiary of the General Partner (the “Successor Limited Partner”)
and successor to American Realty Capital Trust III, Inc., a Maryland corporation (“Target”) and any limited
partner or general partner that is admitted from time to time to the Partnership and listed on Exhibit A attached hereto.

 

WHEREAS, the General Partner formed the
Partnership as a limited partnership on January 13, 2011 pursuant to the Revised Uniform Limited Partnership Act of the State of
Delaware and filed a Certificate of Limited Partnership of the Partnership with the Secretary of State of the State of Delaware.

 

WHEREAS, the General Partner and AR Capital,
LLC (formerly known as American Realty Capital II, LLC), a Delaware limited liability company (the “Initial Limited Partner”)
entered into the Agreement of Limited Partnership on January 13, 2011 (the “Original Agreement”).

 

WHEREAS, the General Partner, the Initial
Limited Partner and ARC Real Estate Partners, LLC, a Delaware limited liability company, entered into the Amended and Restated
Agreement of Limited Partnership, dated as of September 6, 2011, as amended by that certain First Amendment to the Amended and
Restated Agreement of Limited Partnership, dated as of May 11, 2012, as further amended by that certain Second Amendment to the
Amended and Restated Agreement of Limited Partnership, dated as of May 31, 2012, as further amended by that certain Third Amendment
to the Amended and Restated Agreement of Limited Partnership, dated as of July 24, 2012, and as further amended by that certain
Fourth Amendment to the Amended and Restated Agreement of Limited Partnership, dated as of December 28, 2012 (as amended, the “Amended
Agreement”).

 

WHEREAS, pursuant to the Agreement and Plan
of Merger dated as of December 14, 2012, by and among the Partnership, the General Partner, the Successor Limited Partner, Target
and American Realty Capital Operating Partnership III, L.P., a Delaware limited partnership (“Target OP”), Target
will merge with and into the Successor Limited Partner with the Successor Limited Partner as the surviving entity (the “REIT
Merger”), and Target OP will merge with and into the Partnership with the Partnership as the surviving entity (the “Partnership
Merger”, and together with the REIT Merger, the “Mergers”).

 

    	 

    	 

    

 

WHEREAS, prior to the Mergers, Target was
the sole general partner of Target OP and held fractional, undivided shares of ownership interests in Target OP representing its
general partner interest (“Target GP Units”) and a limited partner interest (“Target OP
Units”), and, in connection with the Mergers, all Target GP Units and Target OP Units held by Target prior to the Mergers
will be converted into OP Units of the Partnership representing a limited partner interest in the Partnership.

 

WHEREAS, it is intended that, solely for
U.S. federal income tax purposes, the Partnership Merger qualify as an “assets-over” form of merger under Treasury
Regulations Section 1.708-1(c)(3)(i) resulting in the termination of the Partnership and the continuation of Target OP as the merged
partnership.

 

WHEREAS, the General Partner desires to
amend and restate the Amended Agreement in its entirety with this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the
foregoing, of mutual covenants between the parties hereto, and of other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Amended Agreement is hereby amended, restated, superseded and replaced in its entirety and
the parties hereto agree as follows:

 

ARTICLE
I

DEFINED TERMS

 

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

 

“Act” means the Delaware
Revised Uniform Limited Partnership Act, as it may be amended from time to time.

 

“Additional Funds” has
the meaning set forth in Section 4.03.

 

“Additional Securities”
has the meaning set forth in Section 4.02(a)(ii).

 

“Adjusted Capital Account Deficit”
means, with respect to any Partner, the negative balance, if any, in such Partner’s Capital Account as of the end of any
relevant fiscal year, determined after giving effect to the following adjustments:

 

(a)credit to such Capital Account
any portion of such negative balance which such Partner (i) is treated as obligated to restore to the Partnership pursuant to the
provisions of Section 1.704-1(b)(2)(ii)(c) of the Regulations, or (ii) is deemed to be obligated to restore to the Partnership
pursuant to the penultimate sentences of Sections 1.704-2(g)(1) and 1.704-2(i)(5) of the Regulations; and

 

(b)debit to such Capital Account
the items described in Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6) of the Regulations.

 

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“Adjustment Events” means
the following events: (a) the Partnership makes a distribution on all outstanding OP Units in Partnership Units, (b) the
Partnership subdivides the outstanding OP Units into a greater number of units or combines the outstanding OP Units into a smaller
number of units, or (c) the Partnership issues any Partnership Units in exchange for its outstanding OP Units by way of a reclassification
or recapitalization of its OP Units. For the avoidance of doubt, the following events shall not be Adjustment Events: (x) the issuance
of Partnership Units in a financing, reorganization, acquisition or other similar business transaction, (y) the issuance of Partnership
Units pursuant to any employee benefit or compensation plan or distribution reinvestment plan, or (z) the issuance of any Partnership
Units to the General Partner in respect of a capital contribution to the Partnership of proceeds from the sale of securities by
the General Partner.

 

“Administrative Expenses”
means (a) all administrative and operating costs and expenses incurred by the Partnership, (b) administrative costs and expenses
of the General Partner, including any salaries or other payments to directors, officers or employees of the General Partner, and
any accounting and legal expenses of the General Partner, which expenses, the Partners have agreed, shall be treated as expenses
of the Partnership and not the General Partner, and (c) to the extent not included in clauses (a) or (b) above, REIT Expenses;
provided, however, that Administrative Expenses shall not include any administrative costs and expenses incurred
by the General Partner that are attributable to Properties or interests in a Subsidiary that are owned by the General Partner other
than through its ownership interest in the Partnership.

 

“Affected Gain” has the
meaning set forth in Section 5.01(f)(ii).

 

“Affiliate” means, (a)
any Person that, directly or indirectly, controls or is controlled by or is under common control with such Person, (b) any other
Person that owns, beneficially, directly or indirectly, 10% or more of the outstanding capital stock, shares or equity interests
of such Person, or (c) any officer, director, employee, partner, member, manager or trustee of such Person or any Person controlling,
controlled by or under common control with such Person (excluding trustees and Persons serving in similar capacities who are not
otherwise an Affiliate of such Person). For the purposes of this definition, “control” (including the correlative meanings
of the terms “controlled by” and “under common control with”), as used with respect to any Person, shall
mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such
Person, through the ownership of voting securities or partnership interests or otherwise.

 

“Aggregate Share Ownership Limit”
has the meaning set forth in the Charter.

 

“Agreed Value” means
the fair market value of a Partner’s non-cash Capital Contribution as of the date of contribution as agreed to by such Partner
and the General Partner. The names and addresses of the Partners, number of Partnership Units issued to each Partner, and the Agreed
Value of non-cash Capital Contributions as of the date of contribution are set forth on Exhibit A, as it may be amended
or restated from time to time.

 

“Agreement” means this
Second Amended and Restated Agreement of Limited Partnership, as it may be amended, supplemented or restated from time to time.

 

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“ARCA Limited Partner”
means American Realty Capital Advisors III, LLC, its successors and assigns.

 

“AREP Limited Partner”
means ARC Real Estate Partners, LLC, its successors and assigns.

 

“Available Cash” means,
with respect to the applicable period of measurement (i.e., any period (other than the first period in which this calculation of
Available Cash is being made) beginning on the first day of the fiscal year, quarter or other period commencing immediately after
the last day of the fiscal year, quarter or other applicable period for purposes of the prior calculation of Available Cash for
or with respect to which a distribution has been made, and ending on the last day of the fiscal year, quarter or other applicable
period immediately preceding the date of the calculation), the excess, if any, as of such date, of

 

(a)the gross cash receipts of the
Partnership for such period from all sources whatsoever, including the following:

 

(i)all rents, revenues,
income and proceeds derived by the Partnership from its operations, including distributions received by the Partnership from any
Entity in which the Partnership has an interest;

 

(ii)all proceeds and
revenues received by the Partnership on account of any sales of any Property or as a refinancing of or payment of principal, interest,
costs, fees, penalties or otherwise on account of any borrowings or loans made by the Partnership or financings or refinancings
of any property of the Partnership;

 

(iii)the amount of any
insurance proceeds and condemnation awards received by the Partnership;

 

(iv)all Capital Contributions
and loans received by the Partnership from its Partners;

 

(v)all cash amounts previously
reserved by the Partnership, to the extent such amounts are no longer needed for the specific purposes for which such amounts were
reserved; and

 

(vi)the proceeds of liquidation
of the Property in accordance with this Agreement;

 

over

 

(b)the sum of the following:

 

(i)all operating costs
and expenses, including taxes and other expenses of the Properties and capital expenditures made during such period (without deduction,
however, for any capital expenditures, charges for Depreciation or other expenses not paid in cash or expenditures from reserves
described in clause (viii) below);

 

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(ii)all costs and expenses
expended or paid during such period in connection with the sale or other disposition, or financing or refinancing, of Property
or the recovery of insurance or condemnation proceeds;

 

(iii)all fees provided
for under this Agreement;

 

(iv)all debt service,
including principal and interest, paid during such period on all indebtedness (including under any line of credit) of the Partnership;

 

(v)all capital contributions,
advances, reimbursements, loans or similar payments made to any Person in which the Partnership has an interest;

 

(vi)all loans made by
the Partnership in accordance with the terms of this Agreement;

 

(vii)all reimbursements
to the General Partner or its Affiliates during such period; and

 

(viii)the amount of any
new reserve or reserves or increase in reserves established during such period which the General Partner determines is necessary
or appropriate in its sole and absolute discretion.

 

Notwithstanding the foregoing, Available Cash shall not include
any cash received or reductions in reserves, or take into account any disbursements made or reserves established, after commencement
of the dissolution and liquidation of the Partnership.

 

“Average Class B Economic
Capital Account Balance” means, with respect to a Limited Partner owning Class B Units, an amount equal to the quotient
of (a) the Class B Economic Capital Account Balance of such Limited Partner divided by (b) the number of Class B Units owned by
such Limited Partner.

 

“Average LTIP Economic
Capital Account Balance” means, with respect to a Limited Partner owning LTIP Units, an amount equal to the quotient
of (a) the LTIP Economic Capital Account Balance of such Limited Partner divided by (b) the number of LTIP Units owned by such
Limited Partner.

 

“Board of Directors”
means the Board of Directors of the General Partner.

 

“Business Day” means
any day other than Saturday, Sunday or a day on which state or federally chartered banking institutions in New York, New York are
not required to be open.

 

“Capital Account” means
with respect to any Partner, the Capital Account maintained for such Partner in accordance with the following provisions:

 

(c)to each Partner’s Capital
Account there shall be credited:

 

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(i)such Partner’s
Capital Contributions;

 

(ii)such Partner’s
distributive share of Net Income, Net Property Gain and any items in the nature of income or gain which are specially allocated
to such Partner pursuant to Sections 5.01(c) and 5.01(d); and

 

(iii)the amount of any
Partnership liabilities assumed by such Partner or which are secured by any asset distributed to such Partner;

 

(d)to each Partner’s Capital
Account there shall be debited:

 

(i)the amount of cash
and the Gross Asset Value of any property distributed to such Partner pursuant to any provision of this Agreement;

 

(ii)such Partner’s
distributive share of Net Loss, Net Property Loss and any items in the nature of expenses or losses which are specially allocated
to such Partner pursuant to Sections 5.01(c), 5.01(d) and 15.05(d); and

 

(iii)the amount of any
liabilities of such Partner assumed by the Partnership or which are secured by any asset contributed by such Partner to the Partnership;
and

 

(e)if all or a portion of a Partnership
Interest is transferred in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of
the transferor to the extent it relates to the transferred Partnership Interest.

 

The foregoing provisions and the other provisions
of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Sections 1.704-1(b) and 1.704-2 of
the Regulations, and shall be interpreted and applied in a manner consistent with such Regulations. If the General Partner shall
reasonably determine that it is prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto (including
debits or credits relating to liabilities which are secured by contributed or distributed assets or which are assumed by the Partnership,
the General Partner or any Limited Partner) are computed in order to comply with such Regulations, the General Partner may make
such modification; provided, however, that all allocations of Partnership income, gain, loss and deduction continue
to have “substantial economic effect” within the meaning of Section 704(b) of the Code and that no Limited Partner
is materially adversely affected by any such modification.

 

“Capital Account Limitation”
has the meaning set forth in Section 16.02(b) hereof.

 

“Capital Contribution”
means the total amount of cash, cash equivalents, and the Agreed Value of any Property (less any liabilities assumed with respect
to such Property) or other asset contributed or agreed to be contributed, as the context requires, to the Partnership by each Partner
pursuant to the terms of the Agreement. Any reference to the Capital Contribution of a Partner shall include the Capital Contribution
made by a predecessor holder of the Partnership Interest of such Partner.

 

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“Cash Amount” means an
amount of cash per OP Unit equal to the Value of the REIT Shares Amount on the date of receipt by the Partnership and the General
Partner of a Notice of Redemption.

 

“Cash Available for Distribution”
means the Available Cash other than Net Sales Proceeds.

 

“Certificate” means any
instrument or document that is required under the laws of the State of Delaware, or any other jurisdiction in which the Partnership
conducts business, to be signed and sworn to by the Partners (either by themselves or pursuant to the power-of-attorney granted
to the General Partner in Section 8.02 hereof) and filed for recording in the appropriate public offices within the State of Delaware
or such other jurisdiction to perfect or maintain the Partnership as a limited partnership, to effect the admission, withdrawal
or substitution of any Partner of the Partnership, or to protect the limited liability of the Limited Partners as limited partners
under the laws of the State of Delaware or such other jurisdiction.

 

“Change of Control” means,
as to the General Partner, the occurrence of any of the following:

 

(f)any “person” as
such term is used in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof except that
such term shall not include (A) the General Partner or any Subsidiaries of the General Partner, (B) any trustee or other fiduciary
holding securities under an employee benefit plan of the General Partner or any Affiliate of the General Partner, (C) an underwriter
temporarily holding securities pursuant to an offering of such securities, (D) any corporation owned, directly or indirectly, by
the stockholders of the General Partner in substantially the same proportions as their ownership of common shares of the General
Partner, or (E) any person or group as used in Rule 13d-1(b) under the Exchange Act, is or becomes the Beneficial Owner, as such
term is defined in Rule 13d-3 under the Exchange Act, directly or indirectly, of securities of the General Partner representing
at least 35% of the combined voting power or common shares of the General Partner;

 

(g)during any period of two consecutive
years, individuals who at the beginning of such period constitute the Board of Directors or whose election by the Board of Directors
or nomination for election by the General Partner’s stockholders was approved by a vote of at least two thirds (2/3) of the
Board of Directors then still in office cease for any reason to constitute at least a majority thereof;

 

(h)there is consummated a merger
or consolidation of the General Partner or any Subsidiary of the General Partner with any other corporation, other than a merger
or consolidation which would result in the voting securities of the General Partner outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent
thereof) in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan
of the General Partner or any Subsidiary of the General Partner, more than 50% of the combined voting power and common shares of
the General Partner or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation;
or

 

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(i)there is consummated an agreement
for the sale or disposition by the General Partner of all or substantially all of the General Partner’s assets (or any transaction
having a similar effect, including a liquidation) other than a sale or disposition by the General Partner of all or substantially
all of the General Partner’s assets to an entity, more than fifty percent (50%) of the combined voting power and common shares
of which is owned by stockholders of the General Partner in substantially the same proportions as their ownership of the common
shares of the General Partner immediately prior to such sale.

 

“Charter” means the charter
of the General Partner, as in effect from time to time.

 

“Class
B Conversion Date” has the meaning set forth in
Section 15.04(a).

 

“Class B Economic Capital
Account Balances” mean the Capital Account balances of the Class B Units holders to the extent attributable to their
ownership of Class B Units reduced by any forfeiture allocations in accordance with Section 15.05(d) due to the forfeiture of any
Class B Units.

 

“Class B Unit” means
a Partnership Unit which is designated as a Class B Unit of the Partnership.

 

“Code” means the Internal
Revenue Code of 1986, as amended, and as hereafter amended from time to time. Reference to any particular provision of the Code
shall mean that provision in the Code at the date hereof and any successor provision of the Code.

 

“Commission” means the
U.S. Securities and Exchange Commission.

 

“Common Units” means
any class or series of Partnership Interest that does not have a priority or preference in the payment of distributions in the
distribution of assets upon any Liquidation, including OP Units, Class B Units and Manager’s Units.

 

“Concurrent LTIP Distribution”
has the meaning provided in Section 16.01(a)(ii)(1).

 

“Concurrent Manager Distribution”
has the meaning provided in Section 12.03(a)(i).

 

“Constituent Person”
has the meaning set forth in Section 15.04(d).

 

“Contributed Property”
means each property, partnership interest, contract right or other asset, in such form as may be permitted by the Act, contributed
or deemed contributed to the Partnership by any Partner, including any interest in any successor partnership occurring as a result
of a termination of the Partnership pursuant to Section 708 of Code.

 

“Contribution Agreement”
means that certain contribution agreement, dated February 4, 2011, between the Partnership and ARC Real Estate Partners, LLC.

 

“Conversion Factor” means
1.0, provided, that in the event that the General Partner (i) declares or pays a dividend on its outstanding REIT Shares
in REIT Shares or makes a distribution to all holders of its outstanding REIT Shares in REIT Shares, (ii) subdivides its outstanding
REIT Shares or (iii) combines its outstanding REIT Shares into a smaller number of REIT Shares, the Conversion Factor shall be
adjusted by multiplying the Conversion Factor by a fraction, the numerator of which shall be the number of REIT Shares issued and
outstanding on the record date for such dividend, distribution, subdivision or combination (assuming for such purposes that such
dividend, distribution, subdivision or combination has occurred as of such time), and the denominator of which shall be the actual
number of REIT Shares (determined without the above assumption) issued and outstanding on such date and, provided further,
that in the event that an entity other than an Affiliate of the General Partner shall become General Partner pursuant to any merger,
consolidation or combination of the General Partner with or into another entity (the “Successor Entity”), the
Conversion Factor shall be adjusted by multiplying the Conversion Factor by the number of shares of the Successor Entity into which
one REIT Share is converted pursuant to such merger, consolidation or combination, determined as of the date of such merger, consolidation
or combination. Any adjustment to the Conversion Factor shall become effective immediately after the effective date of such event
retroactive to the record date, if any, for such event; provided, however, that if the General Partner receives a
Notice of Redemption after the record date, but prior to the effective date of such dividend, distribution, subdivision or combination,
the Conversion Factor shall be determined as if the General Partner had received the Notice of Redemption immediately prior to
the record date for such dividend, distribution, subdivision or combination.

 

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“Defaulting Limited Partner”
means a Limited Partner that has failed to pay any amount owed to the Partnership under a Partnership Loan within 15 days after
demand for payment thereof is made by the Partnership.

 

“Depreciation” means,
for each fiscal year or other period, an amount equal to the depreciation, amortization, or other cost recovery deduction allowable
for federal income tax purposes with respect to an asset for such fiscal year or other period, except that (a) with respect to
any asset the Gross Asset Value of which differs from its adjusted tax basis for federal income tax purposes at the beginning of
such fiscal year or other period and which difference is being eliminated by use of the “remedial method” as defined
by Section 1.704-3(d) of the Regulations, Depreciation for such fiscal year or other period shall be the amount of book basis recovered
for such fiscal year or other period under the rules prescribed by Section 1.704-3(d)(2) of the Regulations, and (b) with respect
to any other asset the Gross Asset Value of which differs from its adjusted tax basis for federal income tax purposes at the beginning
of such fiscal year or other period, Depreciation shall be an amount which bears the same ratio to such beginning Gross Asset Value
as the federal income tax depreciation, amortization, or other cost recovery deduction for such fiscal year or other period bears
to such beginning adjusted tax basis; provided, however, that in the case of clause (b) above, if the adjusted tax
basis for federal income tax purposes of an asset at the beginning of such fiscal year or other period is zero, Depreciation shall
be determined with reference to such beginning Gross Asset Value using any reasonable method selected by the General Partner.

 

“Distributable Amount”
has the meaning set forth in Section 5.02(e).

 

“Distribution Triggering Event”
means the time at which the Partnership covers the payment of distributions on OP Units, that correspond with the General Partner’s
cash dividends declared in respect of the REIT Shares, for the six immediately preceding months from the funds from operations
(as defined by the National Association of Real Estate Investment Trusts from time to time), as determined in good faith for the
General Partner, adjusted to exclude acquisition-related fees and expenses.

 

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“Entity” means any general
partnership, limited partnership, corporation, joint venture, trust, business trust, real estate investment trust, limited liability
company, limited liability partnership, cooperative or association.

 

“Event of Bankruptcy”
as to any Person means (i) the filing of a petition for relief as to such Person as debtor or bankrupt under the Bankruptcy Code
of 1978, as amended, or similar provision of law of any jurisdiction (except if such petition is contested by such Person and has
been dismissed within 90 days); (ii) the insolvency or bankruptcy of such Person as finally determined by a court proceeding; (iii)
the filing by such Person of a petition or application to accomplish the same or for the appointment of a receiver or a trustee
for such Person or a substantial part of his assets; or (iv) the commencement of any proceedings relating to such Person as a debtor
under any other reorganization, arrangement, insolvency, adjustment of debt or liquidation law of any jurisdiction, whether now
in existence or hereinafter in effect, either by such Person or by another, provided, that if such proceeding is commenced
by another, such Person indicates his approval of such proceeding, consents thereto or acquiesces therein, or such proceeding is
contested by such Person and has not been finally dismissed within 90 days.

 

“Excepted Holder Limit”
has the meaning set forth in the Charter.

 

“Exchange Act” means
the Securities Exchange Act of 1934, as amended.

 

“Forced Conversion” has
the meaning set forth in Section 16.02(c) hereof.

 

“Forced Conversion Notice”
has the meaning set forth in Section 16.02(c) hereof.

 

“General Partner” has
the meaning set forth in the first paragraph of this Agreement.

 

“General Partner Loan”
means a loan extended by the General Partner to a Defaulting Limited Partner in the form of a payment on a Partnership Loan by
the General Partner to the Partnership on behalf of the Defaulting Limited Partner.

 

“General Partner Interest”
means the Partnership Interests held by the General Partner in its capacity as the general partner of the Partnership, which Partnership
Interest is an interest as a general partner under the Act. The General Partner Interest may be expressed as a number of Partnership
Units. A number of OP Units held by the General Partner equal to one-tenth of one percent (0.1%) of all outstanding Partnership
Units shall be deemed to be the General Partner Interest. All other Partnership Units owned by the General Partner and any Partnership
Units owned by any Affiliate or Subsidiary of the General Partner shall be considered to constitute a Limited Partnership Interest.

 

“Gross Asset Value” means,
with respect to any asset of the Partnership, such asset’s adjusted basis for federal income tax purposes, except as follows:

 

    	10

    	 

    

 

(j)the initial Gross Asset Value
of any asset contributed by a Partner to the Partnership shall be the gross fair market value of such asset, without reduction
for liabilities, as determined by the contributing Partner and the Partnership on the date of contribution thereof;

 

(k)if the General Partner determines
that an adjustment is necessary or appropriate to reflect the relative economic interests of the Partners, the Gross Asset Values
of all Partnership assets shall be adjusted in accordance with Sections 1.704-1(b)(2)(iv)(f) and (g) of the Regulations to equal
their respective gross fair market values, without reduction for liabilities, as reasonably determined by the General Partner,
as of the following times:

 

(i)Capital Contribution
(other than a de minimis Capital Contribution) to the Partnership by a new or existing Partner as consideration for a Partnership
Interest;

 

(ii)the distribution
by the Partnership to a Partner of more than a de minimis amount of Partnership assets as consideration for the repurchase
or redemption of a Partnership Interest;

 

(iii)the liquidation
of the Partnership within the meaning of Section 1.704-1(b)(2)(ii)(g) of the Regulations; and

 

(iv)the grant of an interest
in the Partnership (other than a de minimis interest) as consideration for the provision of services to or for the benefit
of the Partnership by an existing Partner acting in a partner capacity, or by a new Partner acting in a partner capacity or in
anticipation of becoming a Partner by such Partner;

 

(l)the Gross Asset Values of Partnership
assets distributed to any Partner shall be the gross fair market values of such assets (taking Section 7701(g) of the Code into
account) without reduction for liabilities, as determined by the General Partner as of the date of distribution; and

 

(m)the Gross Asset Values of Partnership
assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Sections 734(b)
or 743(b) of the Code, but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant
to Section 1.704-1(b)(2)(iv)(m) of the Regulations (as set forth in Section 5.01(d)(vi)); provided, however, that
Gross Asset Values shall not be adjusted pursuant to this paragraph (d) to the extent that the General Partner determines that
an adjustment pursuant to paragraph (b) above is necessary or appropriate in connection with a transaction that would otherwise
result in an adjustment pursuant to this paragraph (d).

 

At all times, Gross Asset Values shall be
adjusted by any Depreciation taken into account with respect to the Partnership’s assets for purposes of computing Net Income
and Net Loss.

 

“Indemnified Party” has
the meaning set forth in Section 8.05(f).

 

“Indemnifying Party”
has the meaning set forth in Section 8.05(f).

 

    	11

    	 

    

 

“Indemnitee” means (i)
any Person made a party to a proceeding by reason of its status as (A) the General Partner or (B) a director, manager or member
of the General Partner or an officer or employee of the Partnership or the General Partner, and (ii) such other Persons (including
Affiliates of the General Partner or the Partnership) as the General Partner may designate from time to time (whether before or
after the event giving rise to potential liability), in its sole and absolute discretion.

 

“Independent Director”
means a director of the General Partner who meets the NASDAQ requirements for an independent director as set forth from time to
time.

 

“Initial Limited Partner”
has the meaning set forth in the preamble.

 

“Liability Shortfall”
has the meaning set forth in Section 5.01(f)(iv).

 

“Limited Partner” means
any Person named as a Limited Partner on Exhibit A attached hereto, as it may be amended or restated from time to time,
and any Person who becomes a Substitute Limited Partner or any additional Limited Partner, in such Person’s capacity as a
limited partner in the Partnership.

 

“Limited Partnership Interest”
means a Partnership Interest held by a Limited Partner at any particular time representing a fractional part of the Partnership
Interest of all Limited Partners, and includes any and all benefits to which the holder of such a Limited Partnership Interest
may be entitled as provided in this Agreement and in the Act, together with the obligations of such Limited Partner to comply with
all the provisions of this Agreement and of the Act. Limited Partnership Interests may be expressed as a number of OP Units or
other Partnership Units.

 

“Liquidation” means (a)
a dissolution or winding up of the General Partner or the Partnership, whether voluntary or involuntary, (b) a consolidation or
merger of the General Partner or the Partnership with and into one or more entities which are not affiliates of the General Partner
or the Partnership which results in a Change in Control, or (c) a sale, transfer or other disposition (other than a deemed disposition
pursuant to Section 708(b)(1)(B) of the Code and the Regulations thereunder) of all or substantially all of the General Partner’s
or the Partnership’s assets or a related series of transactions that, taken together, result in the sale, transfer or other
disposition of all or substantially all of the General Partner’s or the Partnership’s assets other than to an affiliate
of the General Partner or the Partnership.

 

“LTIP Award” means each
or any, as the context requires, LTIP Award issued under the OPP Agreement or otherwise having the economic rights and entitlements
and such other rights and entitlements, and subject to the vesting, forfeiture and additional restrictions on transfer, as set
forth in the applicable LTIP Award, including any amendments thereto.

 

“LTIP
Conversion Date” has the meaning set forth in Section 16.02(b).

 

“LTIP Conversion Notice”
has the meaning set forth in Section 16.02(b) hereof.

 

“LTIP Conversion Right”
has the meaning set forth in Section 16.02(a) hereof.

 

    	12

    	 

    

 

“LTIP Economic Capital Account
Balances” mean the Capital Account balances of the LTIP Units holders to the extent attributable to their ownership of
LTIP Units reduced by any forfeiture allocations in accordance with Sections 16.01(c)(ii) and 16.01(e)(iv) due to the forfeiture
of any LTIP Units.

 

“LTIP Unit” means a Partnership
Unit which is designated as an LTIP Unit and which has the rights, preferences and other privileges designated in Section 5.01(c)(iv)
and Article XVI hereof and elsewhere in this Agreement in respect of holders of LTIP Units. The allocation of LTIP Units
among the Partners shall be set forth on Exhibit A, as the same may be amended from time to time.

 

“LTIP Unit Distribution Participation
Date” has the meaning set forth in Section 16.01(a)(ii)(1) hereof.

 

“LTIP Unitholder” means
a Partner that holds LTIP Units.

 

“Majority in Interest”
means the Limited Partners holding more than fifty percent (50%) of the Percentage Interests of the Limited Partners.

 

“Manager’s REIT Share”
means one share of manager’s stock, par value $0.01 per share, of the General Partner (or Successor Entity, as the case may
be).

 

“Manager’s Unit”
means a Partnership Unit which is designated by the General Partner as a Manager’s Unit of the Partnership.

 

“NASDAQ” means The NASDAQ
Stock Market.

 

“Net Income” or “Net
Loss” means, for each fiscal year or other applicable period, an amount equal to the Partnership’s taxable income
or loss for such year or period as determined for federal income tax purposes by the General Partner, determined in accordance
with Section 703(a) of the Code (for this purpose, all items of income, gain, loss or deduction required to be stated separately
pursuant to Section 703(a) of the Code shall be included in taxable income or loss), adjusted as follows:

 

(n)by including as an item of gross
income any tax-exempt income received by the Partnership and not otherwise taken into account in computing Net Income or Net Loss;

 

(o)by treating as a deductible
expense any expenditure of the Partnership described in Section 705(a)(2)(B) of the Code (or which is treated as a Section 705(a)(2)(B)
expenditure pursuant to Section 1.704-1(b)(2)(iv)(i) of the Regulations) and not otherwise taken into account in computing Net
Income or Net Loss, including amounts paid or incurred to organize the Partnership (unless an election is made pursuant to Section
709(b) of the Code) or to promote the sale of interests in the Partnership and by treating deductions for any losses incurred in
connection with the sale or exchange of Partnership property disallowed pursuant to Section 267(a)(1) or 707(b) of the Code as
expenditures described in Section 705(a)(2)(B) of the Code;

 

    	13

    	 

    

 

(p)by taking into account Depreciation
in lieu of depreciation, depletion, amortization and other cost recovery deductions taken into account in computing taxable income
or loss;

 

(q)by computing gain or loss resulting
from any disposition of Partnership property with respect to which gain or loss is recognized for federal income tax purposes by
reference to the Gross Asset Value of such property rather than its adjusted tax basis;

 

(r)if an adjustment of the Gross
Asset Value of any Partnership asset which requires that the Capital Accounts of the Partnership be adjusted pursuant to Sections
1.704-1(b)(2)(iv)(e), (f) and (g) of the Regulations, by taking into account the amount of such adjustment as if such adjustment
represented additional Net Income or Net Loss pursuant to Section 5.01;

 

(s)by excluding Net Property Gain
and Net Property Loss; and

 

(t)by not taking into account in
computing Net Income or Net Loss items specially allocated to the Partners pursuant to Sections 5.01(c), 5.01(d), 15.05(d) and
16.01(e)(iv).

 

“Net Investment” means
the excess, if any, of the total amount of Capital Contributions over any proceeds or property used to redeem Partnership Interests.

 

“Net Property Gain” or
“Net Property Loss” means, for each fiscal year or other applicable period, an amount equal to the Partnership’s
net taxable gain or loss for such year or period from the disposition of Property, including the net capital gain realized in connection
with the actual or hypothetical sale of all or substantially all of the assets of the Partnership, including but not limited to
net capital gain realized in connection with an adjustment of the Gross Asset Value of any Property which requires that the Capital
Accounts of the Partners be adjusted pursuant to Sections 1.704-1(b)(2)(iv)(e), (f) and (g) of the Regulations. For these purposes,
the Gross Asset Value of the Property shall reflect the market capitalization of the General Partner (increased by the amount of
any Partnership liabilities).

 

“Net Sales Proceeds”
means the net proceeds from the sale or other disposition of Property, as determined by the General Partner.

 

“Nonrecourse Deductions”
has the meaning set forth in Sections 1.704-2(b)(1) and 1.704-2(c) of the Regulations.

 

“Nonrecourse Liabilities”
has the meaning set forth in Section 1.704-2(b)(3) of the Regulations.

 

“Notice of Redemption”
means the Notice of Exercise of OP Unit Redemption Right substantially in the form attached as Exhibit B hereto.

 

“Offer” has the meaning
set forth in Section 7.02(a) hereof.

 

    	14

    	 

    

 

“OP Unit” means a Partnership
Unit which is designated by the General Partner as an OP Unit of the Partnership.

 

“OP Unit Economic Balance”
means the quotient of (a) the aggregate Capital Account balance attributable to the OP Units outstanding, plus the amount
of any Partner Minimum Gain or Partnership Minimum Gain, in either case to the extent attributable to the ownership of OP Units
and computed on a hypothetical basis after taking into account all allocations through the date on which any allocation is made
under Section 5.01(c), divided by (b) the number of OP Units outstanding.

 

“OP Unit Redemption Amount”
means either the Cash Amount or the REIT Shares Amount, as selected by the Partnership pursuant to Section 8.04(a) or the General
Partner pursuant to Section 8.04(b) hereof.

 

“OP Unit Redemption Right”
has the meaning provided in Section 8.04(a) hereof.

 

“OP Unit Transaction”
shall mean a transaction to which the Partnership or the General Partner shall be a party, including, without limitation a merger,
consolidation, unit exchange, self tender offer for all or substantially all OP Units or other business combination or reorganization,
or sale of all or substantially all of the Partnership’s assets (but excluding any transaction which constitutes an Adjustment
Event) in each case as a result of which OP Units shall be exchanged for or converted into the right, or the holders of such Units
shall otherwise be entitled, to receive cash, securities or other property or any combination thereof.

 

“OPP Agreement” means
any outperformance award agreement adopted by and among the General Partner, the Partnership and any grantee thereunder, including
the American Realty Capital Properties, Inc. 2013 Advisor Multi-Year Outperformance Agreement.

 

“Partner” means the General
Partner or any Limited Partner, and “Partners” means the General Partner and the Limited Partners.

 

“Partner Nonrecourse Debt”
has the meaning set forth in Section 1.704-2(b)(4) of the Regulations.

 

“Partner Nonrecourse Debt Minimum
Gain” has the meaning set forth in Regulations Section 1.704-2(i). A Partner’s share of Partner Nonrecourse Debt
Minimum Gain shall be determined in accordance with Regulations Section 1.704-2(i)(5).

 

“Partner Nonrecourse Deductions”
has the meaning set forth in Sections 1.704-2(i)(1) and (2) of the Regulations, and the amount of Partner Nonrecourse Deductions
with respect to a Partner Nonrecourse Debt for a Partnership taxable year shall be determined in accordance with the rules of Section
1.704-2(i)(2) of the Regulations.

 

“Partnership” means ARC
Properties Operating Partnership, L.P., a limited partnership formed under the Act and pursuant to this Agreement, and any successor
thereto.

 

“Partnership Interest”
means an ownership interest in the Partnership held by either a Limited Partner or the General Partner, and includes any and all
benefits to which the holder of such a Partnership Interest may be entitled as provided in this Agreement and in the Act, together
with all obligations of such Person to comply with the terms and provisions of this Agreement and of the Act. A Partnership Interest
may be expressed as a number of OP Units, Manager’s Units, Class B Units, LTIP Units or other Partnership Units.

 

    	15

    	 

    

 

“Partnership Loan” means
a loan from the Partnership to the Partner on the day the Partnership pays over the excess of the Withheld Amount over the Distributable
Amount to a taxing authority.

 

“Partnership Minimum Gain”
has the meaning set forth in Regulations Section 1.704-2(d). In accordance with Regulations Section 1.704-2(d), the amount
of Partnership Minimum Gain is determined by first computing, for each Partnership nonrecourse liability, any gain the Partnership
would realize if it disposed of the property subject to that liability for no consideration other than full satisfaction of the
liability, and then aggregating the separately computed gains. A Partner’s share of Partnership Minimum Gain shall be determined
in accordance with Regulations Section 1.704-2(g)(1).

 

“Partnership Record Date”
means the record date established by the General Partner for the distribution of cash pursuant to Section 5.02 hereof, which record
date shall be the same as the record date established by the General Partner for a distribution to its stockholders of some or
all of its portion of such distribution.

 

“Partnership Unit” means
a fractional, undivided share of the Partnership Interests of all Partners issued hereunder, and includes Series A Preferred Units,
Series B Preferred Units, OP Units, Class B Units, Manager’s Units, LTIP Units and any other class or series of Partnership
Units that may be established after the date hereof. The number of Partnership Units outstanding and the Percentage Interests represented
by such Partnership Units, if any, are set forth on Exhibit A hereto, as it may be amended or restated from time to time.
The ownership of Partnership Units may be evidenced by a certificate in a form approved by the General Partner.

 

“Percentage Interest”
means the percentage determined by dividing the number of Partnership Units of a Partner by the sum of the number of Partnership
Units of all Partners (other than the Series A Preferred Units and the Series B Preferred Units).

 

“Person” means any individual
or Entity.

 

“Precontribution Gain”
has the meaning set forth in Section 5.01(f)(iii).

 

“Property” means any
property or other investment in which the Partnership, directly or indirectly, holds an ownership interest.

 

“Redemption Shares” has
the meaning set forth in Section 8.05(a) hereof.

 

“Redeeming Limited Partner”
has the meaning provided in Section 8.04(a).

 

“Registration Statement”
has the meaning set forth in Section 8.05(a).

 

    	16

    	 

    

 

“Regulations” means the
Federal Income Tax Regulations issued under the Code, as amended and as hereafter amended from time to time. Reference to any particular
provision of the Regulations shall mean that provision of the Regulations on the date hereof and any successor provision of the
Regulations.

 

“REIT” means a real estate
investment trust under Sections 856 through 860 of the Code.

 

“REIT Expenses” means
(i) costs and expenses relating to the formation and continuity of existence and operation of the General Partner and any Subsidiaries
thereof (which Subsidiaries shall, for purposes hereof, be included within the definition of the General Partner), including taxes,
fees and assessments associated therewith, any and all costs, expenses or fees payable to any director, officer or employee of
the General Partner, and reasonable expenses incurred to maintain the General Partner’s qualification as a REIT, (ii) costs
and expenses relating to any public offering and registration, or private offering, of securities by the General Partner, and all
statements, reports, fees and expenses incidental thereto, including, without limitation, underwriting discounts and selling commissions
applicable to any such offering of securities, and any costs and expenses associated with any claims made by any holders of such
securities or any underwriters or placement agents thereof, (iii) costs and expenses associated with any repurchase of any securities
by the General Partner, (iv) costs and expenses associated with the preparation and filing of any periodic or other reports
and communications by the General Partner under federal, state or local laws or regulations, including filings with the Commission,
(v) costs and expenses associated with compliance by the General Partner with laws, rules and regulations promulgated by any regulatory
body, including the Commission and any securities exchange, (vi) costs and expenses associated with compensation of the employees
of the General Partner (including, without limitation, health, vision, dental, disability and life insurance benefits), (vii) costs
and expenses associated with any 401(k) plan, incentive plan, bonus plan or other plan providing for compensation for the employees
of the General Partner, (viii) costs and expenses incurred by the General Partner relating to any issuing or redemption of Partnership
Interests and (ix) all other operating or administrative costs of the General Partner incurred in the ordinary course of its business
on behalf of or in connection with the Partnership.

 

“REIT Requirements” has
the meaning set forth in Section 6.01(a)(xxiv).

 

“REIT Share” means one
share of common stock, par value $0.01 per share, of the General Partner (or Successor Entity, as the case may be).

 

“REIT Shares Amount”
means the number of REIT Shares equal to the product of (X) the number of OP Units offered for redemption by a Redeeming Limited
Partner, multiplied by (Y) the Conversion Factor as adjusted to and including the Specified Redemption Date; provided, that
in the event the General Partner issues to all holders of REIT Shares rights, options, warrants or convertible or exchangeable
securities entitling the holders of REIT Shares to subscribe for or purchase additional REIT Shares, or any other securities or
property (collectively, the “Rights”), and such Rights have not expired at the Specified Redemption Date, then
the REIT Shares Amount shall also include such Rights issuable to a holder of the REIT Shares Amount on the record date fixed for
purposes of determining the holders of REIT Shares entitled to Rights.

 

    	17

    	 

    

 

“Restriction Notice”
has the meaning set forth in Section 8.04(f).

 

“Rights” has the meaning
set forth in the definition of “REIT Shares Amount” contained herein.

 

“S-3 Eligible Date” has
the meaning set forth in Section 8.05(a).

 

“Safe Harbor” has the
meaning set forth in Section 10.05(e).

 

“Safe Harbor Election”
has the meaning set forth in Section 10.05(e).

 

“Safe Harbor Interest”
has the meaning set forth in Section 10.05(e).

 

“Securities Act” means
the Securities Act of 1933, as amended.

 

“Separate Registration Rights Agreement”
has the meaning set forth in Section 8.05.

 

“Series A Articles Supplementary”
means the Articles Supplementary classifying and designating the Series A Preferred Stock and fixing distribution and other preferences
and rights of the Series A Preferred Stock as filed with the State Department of Assessments and Taxation of Maryland on May 10,
2012.

 

“Series A Distribution Payment
Date” shall mean the last calendar day of each month; provided, however, that if any Series A Distribution
Payment Date falls on any day other than a Business Day, the distribution payment due on such Series A Distribution Payment Date
shall be paid on the first Business Day immediately following such Series A Distribution Payment Date.

 

“Series A Distribution Period”
means monthly distribution periods commencing on the first day of each month and ending on and including the day preceding the
first day of the next succeeding Series A Distribution Period.

 

“Series A Junior Units”
means Common Units and any class or series of Partnership Units hereafter issued and outstanding that are not Series A Senior Units,
Series A Preferred Units or Series A Parity Units.

 

“Series A Liquidation Amount”
means the greater of (a) the aggregate Series A Liquidation Preference plus the aggregate Series A Redemption Premium or (b) an
amount per Series A Preferred Unit equal to the amount which would have been payable to a Series A Preferred Unit holder had each
Series A Preferred Unit been converted into OP Units immediately prior to such Liquidation.

 

“Series A Liquidation Preference”
means eleven dollars ($11.00) per Series A Preferred Unit.

 

“Series A Parity Units”
means the Series B Preferred Units and any class or series of Partnership Units hereafter issued and outstanding, whether or not
the distribution rates thereof shall be different from those of the Series A Preferred Units, if the holders of such class or series
and the Series A Preferred Units shall be entitled to (i) the receipt of distributions in proportion to their respective amounts
of accrued and unpaid distributions per unit and (ii) amounts distributable upon Liquidation in proportion to their respective
liquidation preferences, in each case without preference or priority one over the other.

 

    	18

    	 

    

 

“Series A Preferred Return”
means, for each Series A Preferred Unit, a cumulative, non-compounded rate of return equal to $0.77 per annum; provided,
that the amount payable for any Series A Distribution Period shall be computed by dividing the Series A Preferred Return by twelve,
and the amount of distributions payable for any period shorter or longer than a full Series A Distribution Period shall be computed
on the basis of twelve 30-day months and a 360-day year.

 

“Series A Preferred Stock”
means the Series A Convertible Preferred Stock, par value $.01 per share, of the General Partner.

 

“Series A Preferred Unit”
means a Partnership Unit which is designated by the General Partner as a Series A Preferred Unit of the Partnership.

 

“Series A Redemption Date”
has the meaning set forth in Section 13.05.

 

“Series A Redemption Premium”
equals one percent (1%) of the Series A Liquidation Preference.

 

“Series A Senior Units”
means any class or series of Partnership Units hereafter issued and outstanding, if the holders of such class or series shall be
entitled to the receipt of distributions prior to a Liquidation or of amounts distributable upon any event of Liquidation, in preference
or priority to the holders of Series A Preferred Units.

 

“Series B Articles Supplementary”
means the Articles Supplementary classifying and designating the Series B Preferred Stock and fixing distribution and other preferences
and rights of the Series B Preferred Stock dated July 24, 2012 and as filed with the State Department of Assessments and Taxation
of Maryland on July 25, 2012.

 

“Series B Distribution Payment
Date” means the last calendar day of each month; provided, however, that if any Series B Distribution Payment
Date falls on any day other than a Business Day, the distribution payment due on such Series B Distribution Payment Date shall
be paid on the first Business Day immediately following such Series B Distribution Payment Date.

 

“Series B Distribution Period”
means monthly distribution periods commencing on the first day of each month and ending on and including the day preceding the
first day of the next succeeding Series B Distribution Period.

 

“Series B Junior Units”
means Common Units and any class or series of Partnership Units hereafter issued and outstanding that are not Series B Senior Units,
Series B Preferred Units or Series B Parity Units.

 

“Series B Liquidation Amount”
means the greater of (a) the aggregate Series B Liquidation Preference plus the aggregate Series B Redemption Premium or (b) an
amount per Series B Preferred Unit equal to the amount which would have been payable to a Series B Preferred Unit holder had each
Series B Preferred Unit been converted into OP Units immediately prior to such Liquidation.

 

    	19

    	 

    

 

“Series B Liquidation Preference”
means ten dollars and sixty cents ($10.60) per Series B Preferred Unit.

 

“Series B Parity Units”
means the Series A Preferred Units and any class or series of Partnership Units hereafter issued and outstanding, whether or not
the distribution rates thereof shall be different from those of the Series B Preferred Units, if the holders of such class or series
and the Series B Preferred Units shall be entitled to (i) the receipt of distributions in proportion to their respective amounts
of accrued and unpaid distributions per unit and (ii) amounts distributable upon Liquidation in proportion to their respective
liquidation preferences, in each case without preference or priority one over the other.

 

“Series B Preferred Return”
means, for each Series B Preferred Unit, a cumulative, non-compounded rate of return equal to $0.74 per annum; provided,
that the amount payable for any Series B Distribution Period shall be computed by dividing the Series B Preferred Return by
twelve, and the amount of distributions payable for any period shorter or longer than a full Series B Distribution Period shall
be computed on the basis of twelve 30-day months and a 360-day year.

 

“Series B Preferred Stock”
means the Series B Convertible Preferred Stock, par value $.01 per share, of the General Partner.

 

“Series B Preferred Unit”
means a Partnership Unit which is designated by the General Partner as a Series B Preferred Unit of the Partnership.

 

“Series B Redemption Date”
has the meaning set forth in Section 14.05.

 

“Series B Redemption Premium”
shall equal one percent (1%) of the Series B Liquidation Preference.

 

“Series B Senior Units”
shall mean any class or series of Partnership Units hereafter issued and outstanding, if the holders of such class or series shall
be entitled to the receipt of distributions prior to a Liquidation or of amounts distributable upon any event of Liquidation, in
preference or priority to the holders of Series B Preferred Units.

 

“Service” means the Internal
Revenue Service.

 

“Specified Redemption Date”
means the first business day of the month that is at least 60 calendar days after the receipt by the General Partner of a Notice
of Redemption.

 

“Subsidiary” means, with
respect to any Person, any corporation or other entity of which a majority of (i) the voting power of the voting equity securities
or (ii) the outstanding equity interests is owned, directly or indirectly, by such Person.

 

    	20

    	 

    

 

“Subsidiary Partnership”
means any partnership or limited liability company in which the General Partner, the Partnership or a wholly owned subsidiary of
the General Partner or the Partnership owns a partnership or limited liability company interest.

 

“Substitute Limited Partner”
means any Person admitted to the Partnership as a Limited Partner pursuant to Section 9.03 hereof.

 

“Successor Entity” has
the meaning set forth in the definition of “Conversion Factor” contained herein.

 

“Survivor” has the meaning
set forth in Section 7.02(b).

 

“Tax Items” has the meaning
set forth in Section 5.01(f)(i).

 

“Tax Matters Partner”
has the meaning set forth within Section 6231(a)(7) of the Code.

 

“Tax Protection Agreement”
means that tax protection agreement, dated September 6, 2011, by and among the Partnership, the General Partner and ARC Real Estate
Partners, LLC.

 

“Trading Day” means a
day on which the principal national securities exchange on which a security is listed or admitted to trading is open for the transaction
of business or, if a security is not listed or admitted to trading on any national securities exchange, shall mean any day other
than a Saturday, a Sunday or a day on which banking institutions in the State of New York are authorized or obligated by law or
executive order to close.

 

“Transaction” has the
meaning set forth in Section 7.02(a).

 

“Transfer” has the meaning
set forth in Section 9.02(a).

 

“TRS” means a taxable
REIT subsidiary (as defined in Section 856(l) of the Code) of the General Partner.

 

“Unvested LTIP Units”
has the meaning set forth in Section 16.01(c)(i) hereof.

 

“Value” means, with respect
to any security, the average of the daily market price of such security for the ten consecutive Trading Days immediately preceding
the date of such valuation. The market price for each such Trading Day shall be: (i) if the security is listed or admitted to trading
on the NASDAQ or any national securities exchange, the last reported sale price, regular way, on such day, or if no such sale takes
place on such day, the average of the closing bid and asked prices, regular way, on such day, (ii) if the security is not listed
or admitted to trading on the NASDAQ or any national securities exchange, the last reported sale price on such day or, if no sale
takes place on such day, the average of the closing bid and asked prices on such day, as reported by a reliable quotation source
designated by the General Partner, or (iii) if the security is not listed or admitted to trading on the NASDAQ or any national
securities exchange and no such last reported sale price or closing bid and asked prices are available, the average of the reported
high bid and low asked prices on such day, as reported by a reliable quotation source designated by the General Partner, or if
there shall be no bid and asked prices on such day, the average of the high bid and low asked prices, as so reported, on the most
recent day (not more than ten days prior to the date in question) for which prices have been so reported; provided, that
if there are no bid and asked prices reported during the ten days prior to the date in question, the value of the security shall
be determined by the General Partner acting in good faith on the basis of such quotations and other information as it considers,
in its reasonable judgment, appropriate. In the event the security includes any additional rights, then the value of such rights
shall be determined by the General Partner acting in good faith on the basis of such quotations and other information as it considers,
in its reasonable judgment, appropriate.

 

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“Vested LTIP Units” has
the meaning set forth in Section 16.01(c)(i) hereof.

 

“Withheld Amount” means
any amount required to be withheld by the Partnership with respect to a Partner and paid over to any taxing authority as a result
of any allocation or distribution of income to a Partner or any other transaction.

 

ARTICLE
II

FORMATION OF PARTNERSHIP

 

2.01Formation
of the Partnership. The Partnership was formed as a limited partnership pursuant to the provisions of the Act and the Original
Agreement and continued upon the terms and subject to the conditions set forth in this Agreement. Except as expressly provided
herein to the contrary, the rights and obligations of the Partners and administration and termination of the Partnership shall
be governed by the Act. The Partnership Interest of each Partner shall be personal property for all purposes.

 

2.02Name.
The Name of the Partnership shall be “ARC Properties Operating Partnership, L.P.” and the Partnership’s business
may be conducted under any other name or names deemed advisable by the General Partner, including the name of the General Partner
or any Affiliate thereof. The words “Limited Partnership,” “LP,” “L.P.” or “Ltd.”
or similar words or letters shall be included in the Partnership’s name where necessary for the purposes of complying with
the laws of any jurisdiction that so requires. The General Partner in its sole and absolute discretion may change the name of the
Partnership at any time and from time to time and shall notify the Partners of such change in the next regular communication by
the Partnership to the Partners. Notwithstanding any provision in this Agreement and without the consent of any Limited Partner
or other Person, the General Partner may amend this Agreement and the Certificate of Limited Partnership of the Partnership to
reflect any change in the name of the Partnership.

 

2.03Registered
Office and Agent; Principal Office. The address of the registered office of the Partnership in the State of Delaware is
located at Corporation Service Company, 2711 Centerville Road, Suite 400, Wilmington, DE 19808, and the registered agent for service
of process on the Partnership in the State of Delaware at such address is the Corporation Service Company, a Delaware corporation.
The General Partner may, from time to time, designate a new registered agent and/or registered office for the Partnership and,
notwithstanding any provision in this Agreement, may amend this Agreement and the Certificate of Limited Partnership of the Partnership
to reflect such designation without the consent of the Limited Partners or any other Person. The principal office of the Partnership
is located at: c/o American Realty Capital Properties, Inc., 405 Park Avenue, New York, New York, 10022 or such other place as
the General Partner may from time to time designate by notice to the Limited Partners. The Partnership may maintain offices at
such other place or places as the General Partner deems necessary or desirable.

 

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2.04Term
and Dissolution.

 

(a)The term of the Partnership
shall continue in full force and effect until the Partnership is dissolved and its affairs are wound up upon the first to occur
of any of the following events:

 

(i)the occurrence of
an Event of Bankruptcy as to a General Partner or the dissolution, death, removal or withdrawal of a General Partner or any other
event that results in the General Partner ceasing to be a general partner of the Partnership under the Act unless (A) the business
of the Partnership is continued pursuant to Section 7.04(b) hereof, or (B) at the time of the occurrence of such event there is
at least one remaining general partner of the Partnership who is hereby authorized to and does carry on the business of the Partnership;

 

(ii)the passage of 90
days after the sale or other disposition of all or substantially all of the assets of the Partnership (provided, that if
the Partnership receives an installment obligation as consideration for such sale or other disposition, the Partnership shall continue,
unless sooner dissolved under the provisions of this Agreement, until such time as such installment obligations are paid in full);

 

(iii)the redemption of
all Limited Partnership Interests, unless the General Partner determines to continue the Partnership by the admission of one or
more additional Limited Partners effective as of such redemption;

 

(iv)the election in writing
by the General Partner that the Partnership should be dissolved;

 

(v)at any time there
are no limited partners of the Partnership, unless the business of the Partnership is continued in accordance with the Act; or

 

(vi)the entry of a decree
of judicial dissolution of the Partnership under Section 17-802 of the Act.

 

(b)Upon dissolution of the Partnership
(unless the business of the Partnership is continued pursuant to Section 7.04(b) hereof), the General Partner (or, if dissolution
of the Partnership should occur by reason of Section 2.04(a)(i) or the General Partner is unable to act as liquidator, a liquidating
trustee of the Partnership or other representative designated by a Majority in Interest) shall proceed to wind up the affairs of
the Partnership, liquidate the Partnership’s assets and apply and distribute the proceeds thereof in accordance with Section 5.06
hereof. Notwithstanding the foregoing, the General Partner or the liquidating trustee, as the case may be, may, subject to the
Act, either (i) defer liquidation of, or withhold from distribution for a reasonable time, any assets of the Partnership (including
those necessary to satisfy the Partnership’s debts and obligations), or (ii) distribute the assets to the Partners in
kind.

 

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(c)The Partnership shall terminate
when (i) all of the assets of the Partnership, after payment of or due provision for all debts, liabilities and obligations of
the Partnership shall have been distributed to the Partners in the manner provided for in this Agreement and (ii) the Certificate
of Limited Partnership of the Partnership shall have been canceled in the manner required by the Act.

 

2.05Filing
of Certificate and Perfection of Limited Partnership. The General Partner shall execute, acknowledge, record and file at
the expense of the Partnership any Certificate (including the Certificate of Limited Partnership of the Partnership) and any and
all amendments thereto and all requisite fictitious name statements and notices in such places and jurisdictions as may be necessary
to cause the Partnership to be treated as a limited partnership under, and otherwise to comply with, the laws of each state or
other jurisdiction in which the Partnership conducts business.

 

2.06Certificates
Describing Partnership Units. The Partnership Interests shall not be evidenced by certificates unless requested by a Partner.
At the request of a Partner, the General Partner, at its option, may issue a certificate evidencing such Partner’s Partnership
Interests, including the class or series and number of Partnership Units owned and the Percentage Interest represented by such
Partnership Units as of the date of such certificate. Any such certificate (i) shall be in form and substance as determined
by the General Partner, (ii) shall not be negotiable and (iii) shall bear a legend to the following effect:

 

THIS CERTIFICATE IS NOT NEGOTIABLE. THE PARTNERSHIP UNITS REPRESENTED
BY THIS CERTIFICATE ARE GOVERNED BY AND TRANSFERABLE ONLY IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT OF LIMITED PARTNERSHIP
OF ARC Properties Operating Partnership, L.P., AS AMENDED, SUPPLEMENTED OR RESTATED
FROM TIME TO TIME.

 

Each certificate evidencing Partnership
Interests shall be executed by manual or facsimile signature of the General Partner on behalf of the Partnership. The Partnership
shall maintain books for the purpose of registering the transfer of Partnership Interests. In connection with a Partner’s
transfer in accordance with this Agreement of any Partnership Interests, the certificate(s) evidencing the Partnership Interests,
if any, shall be delivered to the Partnership for cancellation, and the Partnership shall thereupon issue a new certificate to
the transferee evidencing the Partnership Interests that were transferred and, if applicable, the Partnership shall issue a new
certificate to the transferor evidencing any Partnership Interests registered in the name of the transferor that were not transferred.

 

Each Partnership Interest shall constitute
a “security” within the meaning of, and governed by, (i) Article 8 of the Uniform Commercial Code (including Section
8-102(a)(15) thereof) as in effect from time to time in the State of Delaware, and (ii) the corresponding provisions of the Uniform
Commercial Code of any other applicable jurisdiction that now or hereafter substantially includes the 1994 revisions to Article
8 thereof as adopted by the American Law Institute and the National Conference of Commissioners on Uniform State Laws and approved
by the American Bar Association on February 14, 1995.

 

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ARTICLE
III

BUSINESS OF THE PARTNERSHIP

 

The purpose and nature of the business to
be conducted by the Partnership is (i) to conduct any business that may be lawfully conducted by a limited partnership organized
pursuant to the Act, (ii) to enter into any partnership, joint venture or other similar arrangement for the purpose of engaging
in any of the foregoing or the ownership and disposition of interests in any entity engaged in any of the foregoing and (iii) to
do anything necessary or incidental to the foregoing; provided, however, that any business to be conducted by the
Partnership shall be limited to and conducted in such a manner as to permit the General Partner at all times to qualify as a REIT,
unless the General Partner otherwise ceases to, or the Board of Directors determines that the General Partner shall no longer,
qualify as a REIT. In connection with the foregoing, and without limiting the General Partner’s right in its sole and absolute
discretion to cease qualifying as a REIT, the Partners acknowledge that the General Partner has elected REIT status and the General
Partner’s continued qualification as a REIT and the avoidance of income and excise taxes on the General Partner inure to
the benefit of all the Partners and not solely to the General Partner. Notwithstanding the foregoing, the Partners agree that the
General Partner may terminate or revoke its status as a REIT under the Code at any time. The General Partner shall also be empowered
to do any and all acts and things necessary or prudent to ensure that the Partnership will not be classified as a “publicly
traded partnership” taxable as a corporation for purposes of Section 7704 of the Code.

 

ARTICLE
IV

CAPITAL CONTRIBUTIONS AND ACCOUNTS

 

4.01Capital
Contributions. The General Partner and each Limited Partner has made (or shall be deemed to have made) a Capital Contribution
to the Partnership in exchange for the Partnership Units set forth opposite such Partner’s name on Exhibit A hereto,
as it may be amended or restated from time to time by the General Partner to the extent necessary to reflect accurately sales,
exchanges or other Transfers, redemptions, Capital Contributions, the issuance of additional Partnership Units or similar events
having an effect on a Partner’s ownership of Partnership Units.

 

4.02Additional
Capital Contributions and Issuances of Additional Partnership Units. Except as provided in this Section 4.02 or in Section
4.03 hereof, the Partners shall have no right or obligation to make any additional Capital Contributions or loans to the Partnership.
The General Partner may contribute additional capital to the Partnership, from time to time, and receive additional Partnership
Interests, in the form of Partnership Units, in respect thereof, in the manner contemplated in this Section 4.02.

 

(a)Issuances of Additional Partnership
Units.

 

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(i)General. As
of the effective date of this Agreement, the Partnership shall have six classes of Partnership Units, entitled “Series A
Preferred Units,” “Series B Preferred Units,” “OP Units,” “Class B Units,” “Manager’s
Units” and “LTIP Units” respectively. The Series A Preferred Units, Series B Preferred Units, Class B Units,
Manager’s Units and LTIP Units shall have the same rights, privileges and preferences as the OP Units, except as set forth
in Articles XII, XIII, XIV, XV and XVI hereof. Notwithstanding any provision of this Agreement, the General Partner is hereby authorized
to cause the Partnership to issue such additional Partnership Interests, in the form of Partnership Units, for any Partnership
purpose at any time or from time to time to the Partners (including the General Partner and/or the Limited Partner) or to other
Persons, and admit such Persons as additional general partners of the Partnership pursuant to Section 7.03 or additional Limited
Partners pursuant to this Section 4.02, for such consideration, or in connection with the performance of past, present or future
services to the Partnership, and on such terms and conditions as shall be established by the General Partner in its sole and absolute
discretion, all without the approval of any Limited Partners or any other Person. Notwithstanding any provision of this Agreement,
a Person shall be deemed admitted to the Partnership as an additional Limited Partner upon the written consent of the General Partner
and the execution of a counterpart to this Agreement by such Person. The General Partner’s determination that consideration
is adequate shall be conclusive insofar as the adequacy of consideration relates to whether the Partnership Units are validly issued
and fully paid. Notwithstanding any provision of this Agreement, any additional Partnership Units issued thereby may be issued
in one or more classes, or one or more series of any of such classes, with such designations, preferences and relative, participating,
optional or other special rights, powers, preferences and duties, including rights, powers, preferences and duties senior and superior
to the then-outstanding Partnership Units held by the Limited Partners, all as shall be determined by the General Partner in its
sole and absolute discretion and without the approval of any Limited Partner or other Person, including, without limitation, (i)
the allocations of items of Partnership income, gain, loss, deduction and credit to each such class or series of Partnership Units;
(ii) the right of each such class or series of Partnership Units to share in Partnership distributions; (iii) the rights of each
such class or series of Partnership Units upon dissolution and liquidation of the Partnership; and (iv) the right, if any, of the
holder of each such class or series of Partnership Units to vote on Partnership matters; provided, however, that
no additional Partnership Units shall be issued to the General Partner (or any direct or indirect wholly owned Subsidiary of the
General Partner) unless:

 

(1)(A) the additional
Partnership Units are issued in connection with an issuance of REIT Shares of or other interests in the General Partner, which
shares or interests have designations, preferences and other rights, all such that the economic interests are substantially similar
to the designations, preferences and other rights of the additional Partnership Units issued to the General Partner (or any direct
or indirect wholly owned Subsidiary of the General Partner) by the Partnership in accordance with this Section 4.02 and (B) the
General Partner (or any direct or indirect wholly owned Subsidiary of the General Partner) shall make a Capital Contribution to
the Partnership in an amount equal to the consideration received by the General Partner from the issuance of such REIT Shares or
other interests in the General Partner;

 

    	26

    	 

    

 

(2)(A) the additional
Partnership Units are issued in connection with an issuance of REIT Shares of or other interests in the General Partner pursuant
to a taxable share dividend declared by the General Partner, which shares or interests have designations, preferences and other
rights, all such that the economic interests are substantially similar to the designations, preferences and other rights of the
additional Partnership Units issued to the General Partner (or any direct or indirect wholly owned Subsidiary of the General Partner)
by the Partnership in accordance with this Section 4.02, (B) if the General Partner allows the holders of its REIT Shares to elect
whether to receive such dividend in REIT Shares, other interests of the General Partner or cash, the Partnership will give the
Limited Partners (excluding the General Partner or any direct or indirect Subsidiary of the General Partner) the same election
to elect to receive (I) Partnership Units or cash or, (II) at the election of the General Partner, REIT Shares or cash, and (C)
if the Partnership issues additional Partnership Units pursuant to this Section 4.02(a)(i)(2), then an amount of income equal
to the value of the Partnership Units received will be allocated to those holders of OP Units that elect to receive additional
Partnership Units;

 

(3)the additional Partnership
Units are issued in exchange for property owned by the General Partner (or any direct or indirect wholly owned Subsidiary of the
General Partner) with a fair market value, as determined by the General Partner, in good faith, equal to the value of the Partnership
Units; or

 

(4)the additional Partnership
Units are issued to all Partners in proportion to their respective Percentage Interests.

 

Without limiting the foregoing, the General Partner is expressly
authorized to cause the Partnership to issue Partnership Units for less than fair market value, so long as the General Partner
concludes in good faith that such issuance is in the best interests of the General Partner and the Partnership.

 

Notwithstanding any provision in this Agreement, the General
Partner may amend this Agreement in any manner in connection with the creation, authorization and/or issuance of any additional
Partnership Interests, all without the approval of the Limited Partners or any other Person.

 

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(ii)Upon Issuance
of Additional Securities. The General Partner shall not issue any additional REIT Shares (other than REIT Shares issued in
connection with an exchange pursuant to Section 8.04 hereof or a taxable share dividend as described in Section 4.02(a)(i)(2) hereof)
or Rights (collectively, “Additional Securities”) other than to all holders of REIT Shares, unless (A) the General
Partner shall cause the Partnership to issue to the General Partner (or any direct or indirect wholly owned Subsidiary of the General
Partner) Partnership Units or Rights having designations, preferences and other rights, all such that the economic interests are
substantially similar to those of the Additional Securities, and (B) the General Partner (or any direct or indirect wholly owned
Subsidiary of the General Partner) contributes the proceeds from the issuance of such Additional Securities and from any exercise
of Rights contained in such Additional Securities to the Partnership; provided, however, that the General Partner
is allowed to issue Additional Securities in connection with an acquisition of Property to be held directly by the General Partner
(or any direct or indirect wholly owned Subsidiary of the General Partner), but if and only if, such direct acquisition and issuance
of Additional Securities have been approved by a majority of the Independent Directors. Without limiting the foregoing, the General
Partner is expressly authorized to issue Additional Securities for less than fair market value, and the General Partner is authorized
to cause the Partnership to issue to the General Partner (or any direct or indirect wholly owned Subsidiary of the General Partner)
corresponding Partnership Units, so long as (x) the General Partner concludes in good faith that such issuance is in the best interests
of the Partnership and (y) the General Partner (or any direct or indirect wholly owned Subsidiary of the General Partner) contributes
all proceeds from such issuance to the Partnership, including without limitation, the issuance of REIT Shares and corresponding
Partnership Units pursuant to a share purchase plan providing for purchases of REIT Shares at a discount from fair market value
or pursuant to share awards, including share options that have an exercise price that is less than the fair market value of the
REIT Shares, either at the time of issuance or at the time of exercise, and restricted or other share awards approved by the Board
of Directors. For example, in the event the General Partner issues REIT Shares for a cash purchase price and the General Partner
(or any direct or indirect wholly owned Subsidiary of the General Partner) contributes all of the proceeds of such issuance to
the Partnership as required hereunder, the General Partner (or any direct or indirect wholly owned Subsidiary of the General Partner)
shall be issued a number of additional Partnership Units equal to the product of (A) the number of such REIT Shares issued by the
General Partner, the proceeds of which were so contributed, multiplied by (B) a fraction, the numerator of which is 100%, and the
denominator of which is the Conversion Factor in effect on the date of such contribution.

 

(b)Certain Contributions of
Proceeds of Issuance of REIT Shares. In connection with any and all issuances of REIT Shares, the General Partner (or any direct
or indirect wholly owned Subsidiary of the General Partner) shall make Capital Contributions to the Partnership of the proceeds
therefrom, provided, that if the proceeds actually received and contributed by the General Partner (or any direct or indirect
wholly owned Subsidiary of the General Partner) are less than the gross proceeds of such issuance as a result of any underwriter’s
discount, commissions, placement fees or other expenses paid or incurred in connection with such issuance, then the General Partner
(or any direct or indirect wholly owned Subsidiary of the General Partner) shall make a Capital Contribution to the Partnership
constituting the sum of (i) such net proceeds and (ii) an intangible asset in an amount equal to the capitalized costs of the General
Partner relating to such issuance of REIT Shares or other interests in the General Partner. Upon any such Capital Contribution
by the General Partner (or any direct or indirect wholly owned Subsidiary of the General Partner), the Capital Account of the General
Partner (or any direct or indirect wholly owned Subsidiary of the General Partner) shall be increased by the amount of its Capital
Contribution as described in the previous sentence.

 

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(c)Repurchases of Shares.
If the General Partner shall repurchase shares of any class of its shares of common stock, the purchase price thereof and all costs
incurred in connection with such repurchase shall be reimbursed to the General Partner by the Partnership pursuant to Section 6.05
hereof and the General Partner shall cause the Partnership to redeem an equivalent number of Partnership Units of the appropriate
class or series held by the General Partner (which, in the case of REIT Shares, shall be a number equal to the quotient of the
number of such REIT Shares divided by the Conversion Factor) in the manner provided in Section 6.10 hereof.

 

4.03Additional
Funding. If the General Partner determines that it is in the best interests of the Partnership to provide for additional
Partnership funds (“Additional Funds”) for any Partnership purpose, the General Partner may (i) cause the Partnership
to obtain such funds from outside borrowings, or (ii) elect to have the General Partner or any of its Affiliates provide such Additional
Funds to the Partnership through loans or otherwise.

 

4.04Capital
Accounts. A separate Capital Account shall be established and maintained for each Partner.

 

4.05Percentage
Interests. If the number of outstanding OP Units, Manager’s Units, Class B Units, LTIP Units or other class or series
of Partnership Units increases or decreases during a taxable year, each Partner’s Percentage Interest shall be adjusted by
the General Partner effective as of the effective date of each such increase or decrease to a percentage equal to the number of
OP Units, Manager’s Units, Class B Units, LTIP Units or other class or series of Partnership Units held by such Partner divided
by the aggregate number of OP Units, Manager’s Units, Class B Units, LTIP Units or other class or series of Partnership Units,
as applicable, outstanding after giving effect to such increase or decrease. If the Partners’ Percentage Interests are adjusted
pursuant to this Section 4.05, the Net Income and Net Loss for the taxable year in which the adjustment occurs shall be allocated
between the part of the year ending on the effective date of such adjustment and the part of the year beginning on the following
day either (i) as if the taxable year had ended on the date of the adjustment or (ii) based on the number of days in each part.
The General Partner, in its sole and absolute discretion, shall determine which method shall be used to allocate Net Income and
Net Loss for the taxable year in which the adjustment occurs. The allocation of Net Income and Net Loss for the earlier part of
the year shall be based on the Percentage Interests before adjustment, and the allocation of Net Income and Net Loss for the later
part shall be based on the adjusted Percentage Interests.

 

4.06No
Interest on Contributions. No Partner shall be entitled to interest on its Capital Contribution.

 

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4.07Return
of Capital Contributions. No Partner shall be entitled to withdraw any part of its Capital Contribution or its Capital
Account or to receive any distribution from the Partnership, except as specifically provided in this Agreement. Except as otherwise
provided herein, there shall be no obligation to return to any Partner or withdrawn Partner any part of such Partner’s Capital
Contribution for so long as the Partnership continues in existence.

 

4.08No
Third-Party Beneficiary. No creditor or other third party (other than an Indemnitee) having dealings with the Partnership
shall have the right to enforce the right or obligation of any Partner to make Capital Contributions or loans or to pursue any
other right or remedy hereunder or at law or in equity, it being understood and agreed that the provisions of this Agreement shall
be solely for the benefit of, and may be enforced solely by, the parties hereto, Indemnitees and their respective successors and
assigns. To the fullest extent permitted by law, none of the rights or obligations of the Partners herein set forth to make Capital
Contributions or loans to the Partnership shall be deemed an asset of the Partnership for any purpose by any creditor or other
third party, nor may such rights or obligations be sold, transferred or assigned by the Partnership or pledged or encumbered by
the Partnership to secure any debt or other obligation of the Partnership or of any of the Partners. In addition, it is the intent
of the parties hereto that no distribution to any Limited Partner shall be deemed a return of money or other property in violation
of the Act. However, if any court of competent jurisdiction holds that, notwithstanding the provisions of this Agreement, any Limited
Partner is obligated to return such money or property, such obligation shall, to the fullest extent permitted by law, be the obligation
of such Limited Partner and not of the General Partner. Without limiting the generality of the foregoing, a deficit Capital Account
of a Partner shall not be deemed to be a liability of such Partner nor an asset or property of the Partnership.

 

ARTICLE
V

NET INCOME AND NET LOSS; DISTRIBUTIONS

 

5.01Allocations.

 

(a)Allocations of Net Income
and Net Loss. Except as otherwise provided in this Agreement and subject to Sections 15.02(b) and 16.01(c)(iii), after giving
effect to the special allocations in Sections 5.01(c) and 5.01(d), Net Income, Net Loss and, to the extent necessary, individual
items of income, gain, loss or deduction, of the Partnership, without duplication, shall be allocated among the Partners as follows:

 

(i)first, if the
Partnership has Net Income for any taxable year or portion thereof, such Net Income shall be allocated to the Partners holding
Series A Preferred Units and/or Series B Preferred Units pro rata and pari passu in proportion to their relative
accrued and unpaid Series A Preferred Return and/or Series B Preferred Return to the extent of and until such Partners have received
allocations of Net Income equal to the aggregate amount of distributions made to such Partners pursuant to Section 5.02(a)(i);

 

(ii)second, to
the Partners holding OP Units, Manager’s Units, Class B Units and/or LTIP Units pro rata and pari passu to
the extent of and in proportion to the distribution of Cash Available for Distribution to such Partners with respect to their OP
Units, Manager’s Units, Class B Units and/or LTIP Units in accordance with Sections 5.02(a)(ii), 12.03(a) and 16.01(a)(ii);
and

 

    	30

    	 

    

 

(iii)thereafter,
to the Partners holding OP Units, Manager’s Units, Class B Units and/or LTIP Units pro rata and pari passu
in accordance with each such Partner’s respective Percentage Interest with respect to such OP Units, Manager’s Units,
Class B Units and/or LTIP Units; provided, that for the avoidance of doubt, Net Loss, and to the extent necessary, individual
items of loss or deductions shall be allocated (A) first to the Partners holding OP Units, Manager’s Units, Class B Units
and/or LTIP Units pro rata and pari passu in accordance with each such Partner’s respective Percentage Interest
with respect to such OP Units, Manager’s Units, Class B Units and/or LTIP Units until such Partners have received cumulative
allocations of Net Loss equal to the cumulative amount of Net Income allocated to them pursuant to this Section 5.01(a)(iii), (B)
then to the Partners holding OP Units, Manager’s Units, Class B Units and/or LTIP Units to the extent of and in a manner
that has the effect of reversing the allocations of Net Income to such Partners pursuant to Section 5.10(a)(ii), (C) then to the
Partners holding OP Units, Manager’s Units, Class B Units and/or LTIP Units pro rata and pari passu in accordance with each
such Partner’s respective Percentage Interest with respect to such OP Units, Manager’s Units, Class B Units and/or
LTIP Units until each such Partner’s Capital Account with respect to their OP Units, Manager’s Units, Class B Units
and/or LTIP Units has been reduced to zero, but not below zero (provided, further, that if the Capital Account of
one or more such Partners, but not all such Partners, has been reduced to zero, any remaining Net Loss, and to the extent necessary,
individual item of loss or deduction shall be allocated to the remaining Partners holding OP Units, Manager’s Units, Class
B Units and/or LTIP Units in the same manner as in this Section 5.01(a)(ii)(A) until the Capital Account of all such Partners with
respect to such OP Units, Manager’s Units, Class B Units and/or LTIP Units has been reduced to zero), (D) then to the Partners
holding Series A Preferred Units and/or Series B Preferred Units pro rata and pari passu in proportion to their relative
aggregate unpaid Series A Liquidation Preference and/or Series B Liquidation Preference until the Capital Accounts of such Partners
with respect to their Series A Preferred Units and/or Series B Preferred Units has been reduced to zero, and (E) thereafter to
the General Partner.

 

(b)Allocations of Net Property
Gain and Net Property Loss. Except as otherwise provided in this Agreement, after giving effect to the special allocations
in Sections 5.01(c) and 5.01(d), Net Property Gain, Net Property Loss and, to the extent necessary, individual items of gain or
loss comprising Net Property Gain and Net Property Loss of the Partnership, without duplication, shall be allocated among the Partners
as follows:

 

(i)first, if the
Partnership has Net Property Gain for any taxable year or portion thereof, such Net Property Gain shall be allocated to the Partners
holding Series A Preferred Units and/or Series B Preferred Units pro rata and pari passu in proportion to their relative
aggregate Series A Liquidation Preference and/or Series B Liquidation Preference until each such Partners’ Capital Accounts
is equal to such Partner’s aggregate Series A Liquidation Amount and/or Series B Liquidation Amount;

 

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(ii)second, the
Partners holding Series A Preferred Units and/or Series B Preferred Units pro rata and pari passu in proportion to
their relative accrued and unpaid Series A Preferred Return and/or Series B Preferred Return to the extent of and until such Partners
have received allocations of Net Property Gain equal to the aggregate amount of distributions made to such Partners pursuant to
Sections 5.02(b)(i); and

 

(iii)thereafter,
in a manner such that the Capital Account of each Partner immediately after making such allocation, is, as nearly as possible,
equal proportionately to (i) the distributions that would be made to such Partner pursuant to Section 5.02(b) if the Partnership
were dissolved, its affairs wound up and its assets sold for cash equal to their Gross Asset Value, as determined in the reasonable
discretion of the General Partner, all Partnership liabilities were satisfied (limited with respect to each nonrecourse liability
to the Gross Asset Value of the assets securing such liability), and the net assets of the Partnership were distributed in accordance
with Section 5.02(b) to the Partners immediately after making such allocation, minus (ii) such Partner’s share of Partnership
Minimum Gain and Partner Nonrecourse Debt Minimum Gain and the amount, if any and without duplication, that the Partner would be
obligated to contribute to the capital of the Partnership, all computed immediately prior to the hypothetical sale of assets.

 

(c)Special Allocations

 

(i)Special
Allocations of Depreciation. Notwithstanding any other provisions of this Sections 5.01, after giving effect to
the regulatory allocations in Section 5.01(d), but prior to any allocations under Sections 5.01(a)(ii) and 5.01(b)(iii), Depreciation
shall be allocated to the AREP Limited Partner, until the cumulative amount of Depreciation allocated to the AREP Limited
Partner pursuant to this Section 5.01(c)(i) for all years equals $10,000,000, and to the ARCA Limited Partner, until the cumulative
amount of Depreciation allocated to the ARCA Limited Partner pursuant to this subparagraph 5.01(c)(i) for all years equals $10,000,000,
pro rata and pari passu in proportion to the amount of Depreciation that each such Partner is entitled to be allocated
that has not yet been allocated to such Partner.

 

(ii)Special Allocations
of Net Property Gain. Notwithstanding any other provisions of this Sections 5.01, after giving effect to the regulatory
allocations in Section 5.01(d) and to the extent not previously allocated pursuant to Section 5.01(d)(ii), but prior to any allocations
under Section 5.01(b)(iii), Net Property Gain and, to the extent necessary, individual items of income and gain comprising Net
Property Gain of the Partnership, shall be allocated to the AREP Limited Partner and the ARCA Limited Partner, pro rata
and pari passu in proportion to, and to the extent of, the cumulative amount of Depreciation allocated to each such Partner
pursuant to Section 5.01(c)(i).

 

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(iii)Special Allocations
Regarding Class B Units. Notwithstanding any other provisions of this Sections 5.01, after giving effect to the regulatory
allocations in Section 5.01(d) and the special allocations in Section 5.01(c)(ii), but prior to any allocations under Section 5.01(b)(iii),
Net Property Gain and, to the extent necessary, individual items of income and gain comprising Net Property Gain of the Partnership,
shall be allocated to the Partners holding Class B Units until their Class B Economic Capital Account Balances are equal to (A) the
OP Unit Economic Balance, multiplied by (B) the number of their Class B Units; provided, that no such Net Property
Gain and, to the extent necessary, individual items of income and gain comprising Net Property Gain of the Partnership, will be
allocated with respect to any particular Class B Unit unless and to the extent that the OP Unit Economic Balance exceeds the OP
Unit Economic Balance in existence at the time such Class B Unit was issued. Any allocations made pursuant to the first sentence
of this Section 5.01(c)(iii) shall be made among the holders of Class B Units in proportion to the amounts required to be allocated
to each under this Section 5.01(c)(iii). The parties agree that the intent of this Section 5.01(c)(iii) is to make the Capital
Account balance associated with each Class B Unit to be economically equivalent to the Capital Account balance associated with
the OP Units outstanding (on a per-unit basis), but only if and to the extent that the Capital Account balance associated with
the OP Units outstanding, without regard to the allocations under this Section 5.01(c)(iii), has increased on a per-unit basis
since the issuance of the relevant Class B Unit. To the extent Net Property Loss is allocated to Partners holding Class B Units
pursuant to Section 5.01(b)(iii), such Net Property Loss shall be allocated among the Partners holding Class B Units in a manner
that reverses the allocation of Net Property Gain to such Partner pursuant to this Section 5.01(c)(iii).

 

(iv)Special Allocations
Regarding LTIP Units. Notwithstanding any other provisions of this Sections 5.01, after giving effect to the regulatory
allocations in Section 5.01(d) and the special allocations in Sections 5.01(c)(ii) and 5.01(c)(iii), but prior to any allocations
under Section 5.01(b)(iii), Net Property Gain and, to the extent necessary, individual items of income and gain comprising Net
Property Gain of the Partnership, shall be allocated to the LTIP Unitholders until their LTIP Economic Capital Account Balances
are equal to (i) the OP Unit Economic Balance, multiplied by (ii) the number of their LTIP Units; provided that
no such Net Property Gain and, to the extent necessary, individual items of income and gain comprising Net Property Gain of the
Partnership, will be allocated with respect to any particular LTIP Unit unless and to the extent that the OP Unit Economic Balance
exceeds the OP Unit Economic Balance in existence at the time such LTIP Unit was issued. Any allocations made pursuant to the first
sentence of this Section 5.01(c)(iv) shall be made among the LTIP Unitholders in proportion to the amounts required to be allocated
to each under this Section 5.01(c)(iv). The parties agree that the intent of this Section 5.01(c)(iv) is to make the Capital
Account balance associated with each LTIP Unit to be economically equivalent to the Capital Account balance associated with the
OP Units outstanding (on a per-unit basis), but only if and to the extent that the Capital Account balance associated with the
OP Units outstanding, without regard to the allocations under this Section 5.01(c)(iv), has increased on a per-unit basis since
the issuance of the relevant LTIP Unit. To the extent Net Property Loss is allocated to LTIP Unitholders pursuant to Section 5.01(b)(iii),
such Net Property Loss shall be allocated among the LTIP Unitholders in a manner that reverses the allocation of Net Property Gain
to the LTIP Unitholders pursuant to this Section 5.01(c)(iv).

 

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(d)Regulatory Allocations.

 

(i)Minimum Gain Chargeback
(Nonrecourse Liabilities). Except as otherwise provided in Section 1.704-2(f) of the Regulations, if there is a net decrease
in Partnership Minimum Gain for any Partnership fiscal year, each Partner shall be specially allocated items of Partnership income
and gain for such year (and, if necessary, subsequent years) in an amount equal to such Partner’s share of the net decrease
in Partnership Minimum Gain to the extent required by Section 1.704-2(f) of the Regulations. The items to be so allocated shall
be determined in accordance with Sections 1.704-2(f) and (i) of the Regulations. This Section 5.01(d)(i) is intended to comply
with the minimum gain chargeback requirement in said section of the Regulations and shall be interpreted consistently therewith.
Allocations pursuant to this Section 5.01(d)(i) shall be made in proportion to the respective amounts required to be allocated
to each Partner pursuant hereto.

 

(ii)Partner Minimum
Gain Chargeback. Except as otherwise provided in Section 1.704-2(i)(4) of the Regulations, if there is a net decrease in Partner
Nonrecourse Debt Minimum Gain during any fiscal year, each Partner who has a share of the Partner Nonrecourse Debt Minimum Gain,
determined in accordance with Section 1.704-2(i)(5) of the Regulations, shall be specially allocated items of Partnership income
and gain for such year (and, if necessary, subsequent years) in an amount equal to that Partner’s share of the net decrease
in the Partner Nonrecourse Debt Minimum Gain to the extent and in the manner required by Section 1.704-2(i) of the Regulations.
The items to be so allocated shall be determined in accordance with Sections 1.704-2(i)(4) and (j)(2) of the Regulations. This
Section 5.01(d)(ii) is intended to comply with the minimum gain chargeback requirement with respect to Partner Nonrecourse Debt
contained in said section of the Regulations and shall be interpreted consistently therewith. Allocations pursuant to this Section
5.01(d)(ii) shall be made in proportion to the respective amounts required to be allocated to each Partner pursuant hereto.

 

(iii)Qualified Income
Offset. If a Partner unexpectedly receives any adjustments, allocations or distributions described in Sections 1.704-1(b)(2)(ii)(d)(4),
(5) or (6) of the Regulations, and such Partner has an Adjusted Capital Account Deficit, items of Partnership income (including
gross income) and gain shall be specially allocated to such Partner in an amount and manner sufficient to eliminate the Adjusted
Capital Account Deficit as quickly as possible as required by the Regulations. This Section 5.01(d)(iii) is intended to constitute
a “qualified income offset” under Section 1.704-1(b)(2)(ii)(d) of the Regulations and shall be interpreted consistently
therewith.

 

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(iv)Nonrecourse Deductions.
Nonrecourse Deductions for any fiscal year or other applicable period shall be allocated to the Partners in accordance with their
respective Percentage Interests.

 

(v)Partner Nonrecourse
Deductions. Partner Nonrecourse Deductions for any fiscal year or other applicable period with respect to a Partner Nonrecourse
Debt shall be specially allocated to the Partner that bears the economic risk of loss for such Partner Nonrecourse Debt (as determined
under Sections 1.704-2(b)(4) and 1.704-2(i)(1) of the Regulations)

 

(vi)Section 754 Adjustment.
To the extent an adjustment to the adjusted tax basis of any asset of the Partnership pursuant to Section 734(b) of the Code or
Section 743(b) of the Code is required, pursuant to Section 1.704-1(b)(2)(iv)(m) of the Regulations, to be taken into account in
determining Capital Accounts, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the
adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) and such gain or loss shall be specially
allocated among the Partners in a manner consistent with the manner in which each of their respective Capital Accounts are required
to be adjusted pursuant to such section of the Regulations.

 

(vii)Capital Account
Deficits. If any Partner has an Adjusted Capital Account Deficit at the end of any fiscal year or other applicable period which
is in excess of the amount such Partner is obligated to restore pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1)
and 1.704-2(i)(5), such Partner shall be specially allocated items of Partnership income and gain in the amount of such excess
as quickly as possible, provided, that an allocation pursuant to this Section 5.01(d)(vii) shall be made only if and to
the extent that such Partner would have an Adjusted Capital Account Deficit in excess of such amount after all other allocations
provided for under this Agreement have been made as if Section 5.01(d)(iii) and this Section 5.01(d)(vii) were not in this Agreement.

 

(e)Allocations Between Transferor
and Transferee. If a Partner transfers any part or all of its Partnership Interest, the distributive shares of the various
items of Net Income and Net Loss allocable among the Partners during such fiscal year of the Partnership shall be allocated between
the transferor and the transferee Partner either (i) as if the Partnership’s fiscal year had ended on the date of the transfer
or (ii) based on the number of days of such fiscal year that each was a Partner without regard to the results of Partnership activities
in the respective portions of such fiscal year in which the transferor and the transferee were Partners. The General Partner, in
its sole and absolute discretion, shall determine which method shall be used to allocate the distributive shares of the various
items of Net Income and Net Loss between the transferor and the transferee Partner.

 

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(f)Tax Allocations.

 

(i)Items of Income
or Loss. Except as is otherwise provided in this Section 5.01, an allocation of Net Income, Net Loss, Net Property Gain or
Net Property Loss to a Partner shall be treated as an allocation to such Partner of the same share of each item of income, gain,
loss, deduction and item of tax-exempt income or Section 705(a)(2)(B) expenditure (or item treated as such expenditure pursuant
to Section 1.704-1(b)(2)(iv)(i) of the Regulations) (“Tax Items”) that is taken into account in computing Net
Income, Net Loss, Net Property Gain or Net Property Loss.

 

(ii)Section 1245/1250
Recapture. Subject to Section 5.01(f)(iii) below, if any portion of gain from the sale of Partnership assets is treated as
gain which is ordinary income by virtue of the application of Sections 1245 or 1250 of the Code (“Affected Gain”),
then such Affected Gain shall be allocated among the Partners in the same proportion that the depreciation and amortization deductions
giving rise to the Affected Gain were allocated. This Section 5.01(f)(ii) shall not alter the amount of Net Income or Net Property
Gain (or items thereof) allocated among the Partners, but merely the character of such Net Income or Net Property Gain (or items
thereof). For purposes hereof, in order to determine the proportionate allocations of depreciation and amortization deductions
for each fiscal year or other applicable period, such deductions shall be deemed allocated on the same basis as Net Income, Net
Loss, Net Property Gain and Net Property Loss for such respective period.

 

(iii)Precontribution
Gain, Revaluations. With respect to any Contributed Property, the Partnership shall use any permissible method contained in
the Regulations promulgated under Section 704(c) of the Code selected by the General Partner, in its sole discretion, to take into
account any variation between the adjusted basis of such asset and the fair market value of such asset as of the time of the contribution
(“Precontribution Gain”). Each Partner hereby agrees to report income, gain, loss and deduction on such Partner’s
federal income tax return in a manner consistent with the method used by the Partnership. If any asset has a Gross Asset Value
which is different from the Partnership’s adjusted basis for such asset for federal income tax purposes because the Partnership
has revalued such asset pursuant to Section 1.704-1(b)(2)(iv)(f) of the Regulations, the allocations of Tax Items shall be made
in accordance with the principles of Section 704(c) of the Code and the Regulations and the methods of allocation promulgated thereunder.
The intent of this Section 5.01(f)(iii) is that each Partner who contributed to the capital of the Partnership a Contributed Property
will bear, through reduced allocations of depreciation, increased allocations of gain or other items, the tax detriments associated
with any Precontribution Gain. This Section 5.01(f)(iii) is to be interpreted consistently with such intent.

 

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(iv)Excess Nonrecourse
Liability Safe Harbor. Pursuant to Section 1.752-3(a)(3) of the Regulations, solely for purposes of determining each Partner’s
proportionate share of the “excess nonrecourse liabilities” of the Partnership (as defined in Section 1.752-3(a)(3)
of the Regulations), the Partners’ respective interests in Partnership profits shall be determined under any permissible
method reasonably determined by the General Partner; provided, however, that each Partner who has contributed an
asset to the Partnership shall be allocated, to the extent possible, a share of “excess nonrecourse liabilities” of
the Partnership which results in such Partner being allocated nonrecourse liabilities in an amount which is at least equal to the
amount of income required to be allocated to such Partner pursuant to Section 704(c) of the Code and the Regulations promulgated
thereunder (the “Liability Shortfall”). If there is an insufficient amount of nonrecourse liabilities to be
able to allocate to each Partner nonrecourse liabilities equal to the Liability Shortfall, nonrecourse liabilities shall be allocated
to each Partner in pro rata in accordance with each such Partner’s Liability Shortfall.

 

5.02Distribution
of Cash.

 

(a)Cash Available for Distribution.
Subject to the other provisions of this Article V and to the provisions of Sections 12.03(a), 13.03, 14.03 and 16.01(a)(ii),
the General Partner shall cause the Partnership to distribute Cash Available for Distribution, at such times and in such amounts
as are, subject to the terms and conditions of this Agreement, determined by the General Partner in its sole and absolute discretion,
to the Partners who are Partners on the Partnership Record Date with respect to such quarter (or other distribution period), as
follows:

 

(i)first, 100%
to the Partners holding Series A Preferred Units and/or Series B Preferred Units pro rata and pari passu in proportion
to their relative accrued and unpaid Series A Preferred Return and/or Series B Preferred Return until such Partners have received
in the aggregate, pursuant to this Section 5.02(a)(i) and Section 5.02(b)(i), an amount such that the accrued but unpaid Series
A Preferred Return has been paid with respect to each such Series A Preferred Unit and the accrued but unpaid Series B Preferred
Return has been paid with respect to each such Series B Preferred Unit; and

 

(ii)thereafter,
100% to the Partners holding OP Units and/or Class B Units pro rata and pari passu in proportion to each such Partner’s
respective Percentage Interest with respect to such OP Units and/or Class B Units.

 

(b)Net Sales Proceeds. Subject
to the other provisions of this Article V and to the provisions of Sections 13.03 and 14.03, the General Partner shall
cause the Partnership to distribute Net Sales Proceeds, at such times and in such amounts as are, subject to the terms and conditions
of this Agreement, determined by the General Partner in its sole and absolute discretion, to the Partners who are Partners on the
Partnership Record Date with respect to such quarter (or other distribution period), as follows:

 

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(i)first, 100%
to the Partners holding Series A Preferred Units and/or Series B Preferred Units pro rata and pari passu in proportion
to their relative accrued and unpaid Series A Preferred Return and/or Series B Preferred Return until such Partners have received
in the aggregate, pursuant to this Section 5.02(b)(i) and Section 5.02(a)(i), an amount such that the accrued but unpaid Series
A Preferred Return has been paid with respect to each such Series A Preferred Unit and the accrued but unpaid Series B Preferred
Return has been paid with respect to each such Series B Preferred Unit; and

 

(ii)thereafter,
100% to the Partners holding OP Units, Manager’s Units, Class B Units and/or LTIP Units pro rata and pari passu
in proportion to each such Partner’s respective Percentage Interest with respect to such OP Units, Manager’s Units,
Class B Units and/or LTIP Units; provided, that:

 

(1)to the extent the
Average Class B Economic Capital Account Balance of a holder of Class B Units is less than the OP Unit Economic Balance, the Percentage
Interest of such Partner holding Class B Units with respect to such Class B Units shall be reduced for purposes of determining
its proportionate share of distributions pursuant to this Section 5.02(b)(iii) to equal such Partner’s Percentage Interest
with respect to its Class B Units multiplied by a fraction, the numerator of which is such Partner’s Average Class B Economic
Capital Account Balance, and the denominator of which is the OP Unit Economic Balance; and

 

(2)to the extent the
Average LTIP Economic Capital Account Balance of a holder of LTIP Units is less than the OP Unit Economic Balance, the Percentage
Interest of such Partner holding LTIP Units with respect to such LTIP Units shall be reduced for purposes of determining its proportionate
share of distributions pursuant to this Section 5.02(b)(iii) to equal such Partner’s Percentage Interest with respect to
its LTIP Units multiplied by a fraction, the numerator of which is such Partner’s Average LTIP Economic Capital Account Balance,
and the denominator of which is the OP Unit Economic Balance.

 

For the avoidance of doubt,
any decrease in the Percentage Interest of a Partner with respect to its Class B Units or LTIP Units shall result in a corresponding
increase in the Percentage Interests of Partners with respect to their OP Units and/or Manager’s Units (and LTIP Units to
the extent such LTIP Units are eligible for conversion pursuant to Section 16.02(b) but have not been converted).

 

(c)Manager’s Unit Distributions.
Holders of Manager’s Units shall be entitled to receive distributions as set forth in Section 12.03.

 

(d)LTIP Unit Distributions.
LTIP Unitholders shall be entitled to receive distributions as set forth in Section 16.01(a)(ii).

 

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(e)If a new or existing Partner
acquires additional Partnership Units in exchange for a Capital Contribution on any date other than a Partnership Record Date,
the cash distribution attributable to such additional Partnership Units relating to the Partnership Record Date next following
the issuance of such additional Partnership Units shall be reduced in the proportion to (i) the number of days that such additional
Partnership Units are held by such Partner bears to (ii) the number of days between such Partnership Record Date and the immediately
preceding Partnership Record Date.

 

(f)Notwithstanding any other provision
of this Agreement, the General Partner is authorized to take any action that it determines to be necessary or appropriate to cause
the Partnership to comply with any withholding requirements established under the Code or any other federal, state or local law
including, without limitation, pursuant to Sections 1441, 1442, 1445 and 1446 of the Code. To the extent that the Partnership is
required to withhold and pay over to any taxing authority any amount with respect to a Partner, either (i) if the actual amount
to be distributed to the Partner (the “Distributable Amount”) equals or exceeds the Withheld Amount, the entire
Distributable Amount shall be treated as a distribution of cash to such Partner, or (ii) if the Distributable Amount is less than
the Withheld Amount, the Distributable Amount shall be treated as a distribution of cash to such Partner and the excess of the
Withheld Amount over the Distributable Amount shall be treated as a Partnership Loan from the Partnership to the Partner on the
day the Partnership pays over such amount to a taxing authority. A Partner shall repay a Partnership Loan upon the demand of the
Partnership or, alternatively, through withholding by the Partnership with respect to subsequent distributions to the applicable
Partner or assignee. In the event that a Limited Partner fails to pay any amount owed to the Partnership with respect to the Partnership
Loan within 15 days after demand for payment thereof is made by the Partnership on the Limited Partner, the General Partner, in
its sole and absolute discretion, may elect to make the payment to the Partnership on behalf of such Defaulting Limited Partner.
In such event, on the date of payment, the General Partner shall be deemed to have extended a General Partner Loan to the Defaulting
Limited Partner in the amount of the payment made by the General Partner and the General Partner shall succeed to all rights and
remedies of the Partnership against the Defaulting Limited Partner as to that amount. Without limitation, the General Partner shall
have the right to receive any distributions that otherwise would be made by the Partnership to the Defaulting Limited Partner until
such time as the General Partner Loan has been paid in full, and any such distributions so received by the General Partner shall
be treated as having been received by the Defaulting Limited Partner and immediately paid to the General Partner.

 

Any amounts treated as a Partnership Loan
or a General Partner Loan pursuant to this Section 5.02(f) shall bear interest at the lesser of (i) 300 basis points above
the base rate on corporate loans at large United States money center commercial banks, as published from time to time in The
Wall Street Journal, or (ii) the maximum lawful rate of interest on such obligation, such interest to accrue from the date
the Partnership or the General Partner, as applicable, is deemed to extend the loan until such loan is repaid in full.

 

(g)In no event may a Partner receive
a distribution of cash with respect to a Partnership Unit if such Partner is entitled to receive a cash dividend as the holder
of record of a REIT Share for which all or part of such Partnership Unit has been or is being redeemed.

 

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5.03REIT
Distribution Requirements. The General Partner shall use commercially reasonable efforts to cause the Partnership to distribute
amounts sufficient to enable the General Partner to pay distributions to its stockholders that will allow the General Partner to
(i) meet its distribution requirement for qualification as a REIT as set forth in Section 857 of the Code and (ii) avoid any
federal income or excise tax liability imposed by the Code, other than to the extent the General Partner elects to retain and pay
income tax on its net capital gain.

 

5.04No
Right to Distributions in Kind. No Partner shall be entitled to demand property other than cash in connection with any
distributions by the Partnership.

 

5.05Limitations
on Distributions. Notwithstanding any of the provisions of this Agreement, no Partner shall have the right to receive,
and the Partnership and the General Partner shall not have the right to make, a distribution that violates the Act or other applicable
law.

 

5.06Distributions
Upon Liquidation.

 

(a)Upon liquidation of the Partnership,
after the satisfaction of all the debts and obligations of the Partnership, to the extent permitted by law, whether by payment
or the making of reasonable provision for payment thereof, any remaining assets of the Partnership shall be distributed, subject
to Section 5.07(b), first to the Partners holding Series A Preferred Units and/or Series B Preferred Units pro rata in proportion
to their respective positive Capital Accounts and then to all other Partners with positive Capital Accounts in accordance with
their respective positive Capital Accounts.

 

(b)For purposes of Section 5.06(a),
the Capital Account of each Partner shall be determined after making all adjustments in accordance with Sections 5.01, 5.02 and
5.07(b) resulting from Partnership operations and from all sales and dispositions of all or any part of the Partnership’s
assets.

 

(c)Any distributions pursuant to
this Section 5.06 shall be made within a reasonable time as determined by the General Partner in its sole discretion. To the extent
deemed advisable by the General Partner, appropriate arrangements (including the use of a liquidating trust) may be made to assure
that adequate funds are available to satisfy any contingent debts or obligations of the Partnership.

 

(d)If any Partner (other than the
AREP Limited Partner and the ARCA Limited Partner) has a deficit balance in its Capital Account (after giving effect to all contributions,
distributions and allocations for all taxable years, including the year during which such liquidation occurs), such Partner shall
have no obligation to make any contribution to the capital of the Partnership with respect to such deficit, and such deficit shall
not be considered a debt owed to the Partnership or to any other Person for any purpose whatsoever. If the AREP Limited Partner
or the ARCA Limited Partner has a deficit balance in its Capital Account attributable to and to the extent of the special allocation
of Depreciation to such Partner provided for in Section 5.01(c)(i) (after giving effect to all contributions, distributions and
allocations for all taxable years, including the year liquidation occurs), such Limited Partner shall restore and contribute to
the capital of the Partnership the amount necessary to restore such deficit balance to zero, but not to exceed the excess of the
cumulative amount of Depreciation that has been specially allocated to the such Limited Partner pursuant to Section 5.01(c)(i)
over the cumulative amount of Net Property Gain that has been allocated to such Limited Partner in accordance with Section 5.01(c)(ii).
These deficit restoration obligations are intended to comply with Section 1.704-1(b)(2)(ii)(b)(3) of the Regulations and shall
be satisfied before the later to occur of (x) the end of the taxable year in which the Partnership (or the interest of AREP Limited
Partner or the ARCA Limited Partner, as the case may be) is liquidated, or (y) ninety (90) days after the date of the liquidation
of the Partnership (or the interest of the AREP Limited Partner or the ARCA Limited Partner), which amount shall be paid to creditors
of the Partnership or, if the amount contributed exceeds the amount due creditors, shall be distributed to the Partners with positive
Capital Account balances.

 

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5.07Substantial
Economic Effect / Savings Clause.

 

(a)It is the intent of the Partners
that the allocations of Net Income, Net Loss, Net Property Gain and Net Property Loss under the Agreement have “substantial
economic effect” (or be consistent with the Partners’ interests in the Partnership in the case of the allocation of
losses attributable to nonrecourse debt) within the meaning of Section 704(b) of the Code as interpreted by the Regulations promulgated
pursuant thereto. Article V and other relevant provisions of this Agreement shall be interpreted in a manner consistent with such
intent.

 

(b)Notwithstanding anything to
the contrary in this Agreement, it is the intent of the Partners that the allocation provisions of Section 5.01 produce (a) final
Capital Account balances of the Partners holding Series A Preferred Units and/or Series B Preferred Units with respect to such
Series A Preferred Units and/or Series B Preferred Units equal to the aggregate Series A Liquidation Amount and/or Series B Liquidation
Amount, plus any accrued but unpaid Series A Preferred Return and/or Series B Preferred Return, for each such Series A Preferred
Unit and/or Series B Preferred Unit and (b) final Capital Account balances of the Partners holding OP Units, Manager’s Units,
Class B Units and/or LTIP Units with respect to such OP Units, Manager’s Units, Class B Units and/or LTIP Units equal to
the amount such Partners would receive with respect to their OP Units, Manager’s Units, Class B Units and/or LTIP Units pursuant
to Section 5.02(b). To the extent the allocation provisions of Section 5.01 would fail to produce such final Capital Account balances,
(y) such provisions shall be amended by the General Partner if and to the extent necessary to produce such result and (z) Net Income,
Net Loss, Net Property Gain, Net Property Loss and, to the extent necessary, individual items of income, gain, loss and deduction,
of the Partnership for prior open years shall be reallocated by the General Partner, in its sole and absolute discretion, among
the Partners to the extent it is not possible to achieve such result with allocations of Net Income, Net Loss, Net Property Gain,
Net Property Loss and, to the extent necessary, individual items of income, gain, loss and deduction, of the Partnership for the
current year and future years. This Section 5.07(b) shall control notwithstanding any reallocation or adjustment of taxable Net
Income, Net Loss, Net Property Gain, Net Property Loss and, to the extent necessary, individual items of income, gain, loss and
deduction, of the Partnership by the Internal Revenue Service or any other taxing authority. The General Partner shall have the
authority to amend this Agreement without the consent of the Limited Partners, as it reasonably considers advisable, to make the
allocations and adjustments described in this Section 5.07(b).

 

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ARTICLE
VI

RIGHTS, OBLIGATIONS AND POWERS OF THE GENERAL PARTNER

 

6.01Management
of the Partnership.

 

(a)Except as otherwise expressly
provided in this Agreement, the General Partner shall have full, complete and exclusive discretion to manage and control the business
of the Partnership for the purposes herein stated, and shall make all decisions affecting the business and assets of the Partnership.
Subject to the restrictions specifically contained in this Agreement, the powers of the General Partner shall include, without
limitation, the authority to take the following actions on behalf of the Partnership:

 

(i)to acquire, purchase,
own, operate, lease and dispose of any real property and any other property or assets including, but not limited to, notes and
mortgages that the General Partner determines are necessary or appropriate in the business of the Partnership;

 

(ii)to construct buildings
and make other improvements on the properties owned or leased by the Partnership;

 

(iii)to authorize, issue,
sell, redeem or otherwise purchase any Partnership Units or any securities (including secured and unsecured debt obligations of
the Partnership, debt obligations of the Partnership convertible into any class or series of Partnership Units, or Rights relating
to any class or series of Partnership Units) of the Partnership;

 

(iv)to borrow or lend
money for the Partnership, issue or receive evidences of indebtedness in connection therewith, refinance, increase the amount of,
modify, amend or change the terms of, or extend the time for the payment of, any such indebtedness, and secure indebtedness by
mortgage, deed of trust, pledge or other lien on the Partnership’s assets;

 

(v)to pay, either directly
or by reimbursement, for all operating costs and general administrative expenses of the Partnership to third parties or to the
General Partner or its Affiliates as set forth in this Agreement;

 

(vi)to guarantee or become
a co-maker of indebtedness of any Subsidiary of the General Partner or the Partnership, refinance, increase the amount of, modify,
amend or change the terms of, or extend the time for the payment of, any such guarantee or indebtedness, and secure such guarantee
or indebtedness by mortgage, deed of trust, pledge or other lien on the Partnership’s assets;

 

(vii)to use assets of
the Partnership (including, without limitation, cash on hand) for any purpose consistent with this Agreement, including, without
limitation, payment, either directly or by reimbursement, of all operating costs and general and administrative expenses of the
General Partner, the Partnership or any Subsidiary of either, to third parties or to the General Partner as set forth in this Agreement;

 

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(viii)to lease all or
any portion of any of the Partnership’s assets, whether or not the terms of such leases extend beyond the termination date
of the Partnership and whether or not any portion of the Partnership’s assets so leased are to be occupied by the lessee,
or, in turn, subleased in whole or in part to others, for such consideration and on such terms as the General Partner may determine;

 

(ix)to prosecute, defend,
arbitrate or compromise any and all claims or liabilities in favor of or against the Partnership, on such terms and in such manner
as the General Partner may reasonably determine, and similarly to prosecute, settle or defend litigation with respect to the Partners,
the Partnership or the Partnership’s assets;

 

(x)to file applications,
communicate and otherwise deal with any and all governmental agencies having jurisdiction over, or in any way affecting, the Partnership’s
assets or any other aspect of the Partnership’s business;

 

(xi)to make or revoke
any election permitted or required of the Partnership by any taxing authority;

 

(xii)to maintain such
insurance coverage for public liability, fire and casualty, and any and all other insurance for the protection of the Partnership,
for the conservation of Partnership assets, or for any other purpose convenient or beneficial to the Partnership, in such amounts
and such types, as it shall determine from time to time;

 

(xiii)to determine whether
or not to apply any insurance proceeds for any property to the restoration of such property or to distribute the same;

 

(xiv)to establish one
or more divisions of the Partnership, to hire and dismiss employees of the Partnership or any division of the Partnership, and
to retain legal counsel, accountants, consultants, real estate brokers and such other persons as the General Partner may deem necessary
or appropriate in connection with the Partnership business and to pay therefor such reasonable remuneration as the General Partner
may deem reasonable and proper;

 

(xv)to retain other services
of any kind or nature in connection with the Partnership business, and to pay therefor such remuneration as the General Partner
may deem reasonable and proper;

 

(xvi)to negotiate and
conclude agreements on behalf of the Partnership with respect to any of the rights, powers and authority conferred upon the General
Partner;

 

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(xvii)to maintain accurate
accounting records and to file promptly all federal, state and local income tax returns on behalf of the Partnership;

 

(xviii)to distribute
Partnership cash or other Partnership assets in accordance with this Agreement;

 

(xix)to form or acquire
an interest in, and contribute property to, any further limited or general partnerships, joint ventures or other relationships
that it deems desirable (including, without limitation, the acquisition of interests in, and the contributions of property to,
its Subsidiaries and any other Person in which it has an equity interest from time to time);

 

(xx)to establish Partnership
reserves for working capital, capital expenditures, contingent liabilities or any other valid Partnership purpose;

 

(xxi)subject to Section
11.02, to merge, consolidate or combine the Partnership with or into another Person;

 

(xxii)to do any and all
acts and things necessary or prudent to ensure that the Partnership will not be classified as a “publicly traded partnership”
taxable as a corporation under Section 7704 of the Code;

 

(xxiii)to take such other
action, execute, acknowledge, swear to or deliver such other documents and instruments, and perform any and all other acts that
the General Partner deems necessary or appropriate for the formation, continuation and conduct of the business and affairs of the
Partnership and to possess and enjoy all of the rights and powers of a general partner as provided by the Act; and

 

(xxiv)to take such other
action, execute, acknowledge, swear to or deliver such other documents and instruments, and perform any and all other acts that
the General Partner deems necessary or appropriate such that the General Partner shall continue to satisfy the requirements for
qualification as a REIT under the Code and Regulations (“REIT Requirements”) and avoid any federal income or
excise tax liability; provided, however, the General Partner shall not be bound to comply with this covenant to the
extent any distributions required to be made in order to satisfy the REIT Requirements would violate the Act or other applicable
law or contravene the terms of any notes, mortgages or other types of debt obligations to which the Partnership may be subject
in conjunction with borrowed funds.

 

(b)Except as otherwise provided
herein or in the Act, to the extent the duties of the General Partner require expenditures of funds to be paid to third parties,
the General Partner shall not have any obligations hereunder except to the extent that Partnership funds are reasonably available
to it for the performance of such duties, and nothing herein contained shall be deemed to authorize or require the General Partner,
in its capacity as such, to expend its individual funds for payment to third parties or to undertake any individual liability or
obligation on behalf of the Partnership.

 

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6.02Delegation
of Authority. The General Partner may delegate any or all of its powers, rights and obligations hereunder, and may appoint,
employ, contract or otherwise deal with any Person for the transaction of the business of the Partnership, which Person may, under
supervision of the General Partner, perform any acts or services for the Partnership as the General Partner may approve.

 

6.03Indemnification
and Exculpation of Indemnitees.

 

(a)To the fullest extent permitted
by law, the Partnership shall indemnify an Indemnitee from and against any and all losses, claims, damages, liabilities, joint
or several, expenses (including reasonable legal fees and expenses), judgments, fines, settlements, and other amounts arising from
any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative, that relate to the
operations of the Partnership as set forth in this Agreement in which any Indemnitee may be involved, or is threatened to be involved,
as a party or otherwise, unless it is established that: (i) the act or omission of the Indemnitee was material to the matter giving
rise to the proceeding and either was committed in bad faith or was the result of active and deliberate dishonesty; (ii) the
Indemnitee actually received an improper personal benefit in money, property or services; or (iii) in the case of any criminal
proceeding, the Indemnitee had reasonable cause to believe that the act or omission was unlawful. The parties hereto agree, that
the termination of any proceeding by judgment, order or settlement does not create a presumption that the Indemnitee did not meet
the requisite standard of conduct set forth in this Section 6.03(a). The parties hereto agree, that the termination of any proceeding
by conviction or upon a plea of nolo contendere or its equivalent, or an entry of an order of probation prior to judgment,
creates a rebuttable presumption that the Indemnitee acted in a manner contrary to that specified in this Section 6.03(a). Any
indemnification pursuant to this Section 6.03 shall be made only out of the assets of the Partnership.

 

(b)The Partnership shall reimburse
an Indemnitee for reasonable expenses incurred by an Indemnitee who is a party to a proceeding in advance of the final disposition
of the proceeding upon receipt by the Partnership of (i) a written affirmation by the Indemnitee of the Indemnitee’s good
faith belief that the standard of conduct necessary for indemnification by the Partnership as authorized in this Section 6.03 has
been met, and (ii) a written undertaking by or on behalf of the Indemnitee to repay the amount if it shall ultimately be determined
that the standard of conduct has not been met.

 

(c)The indemnification provided
by this Section 6.03 shall be in addition to any other rights to which an Indemnitee or any other Person may be entitled under
any agreement, pursuant to any vote of the Partners, as a matter of law or otherwise, and shall continue as to an Indemnitee who
has ceased to serve in such capacity.

 

(d)The Partnership may purchase
and maintain insurance, as an expense of the Partnership, on behalf of the Indemnitees and such other Persons as the General Partner
shall determine, against any liability that may be asserted against or expenses that may be incurred by such Person in connection
with the Partnership’s activities, regardless of whether the Partnership would have the power to indemnify such Person against
such liability under the provisions of this Agreement.

 

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(e)For purposes of this Section
6.03, the Partnership shall be deemed to have requested an Indemnitee to serve as fiduciary of an employee benefit plan whenever
the performance by it of its duties to the Partnership also imposes duties on, or otherwise involves services by, it to the plan
or participants or beneficiaries of the plan; excise taxes assessed on an Indemnitee with respect to an employee benefit plan pursuant
to applicable law shall constitute fines within the meaning of this Section 6.03; and actions taken or omitted by the Indemnitee
with respect to an employee benefit plan in the performance of its duties for a purpose reasonably believed by it to be in the
interest of the participants and beneficiaries of the plan shall be deemed to be for a purpose that is not opposed to the best
interests of the Partnership.

 

(f)In no event may an Indemnitee
subject the Limited Partners to personal liability by reason of the indemnification provisions set forth in this Agreement.

 

(g)An Indemnitee shall not be denied
indemnification in whole or in part under this Section 6.03 because the Indemnitee had an interest in the transaction with respect
to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement.

 

(h)The provisions of this Section
6.03 are for the benefit of the Indemnitees, their heirs, successors, assigns and administrators and shall not be deemed to create
any rights for the benefit of any other Persons.

 

(i)Any amendment, modification
or repeal of this Section 6.03 or any provision hereof shall be prospective only and shall not in any way affect the indemnification
of an Indemnitee by the Partnership under this Section 6.03 as in effect immediately prior to such amendment, modification or repeal
with respect to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when claims
relating to such matters may arise or be asserted.

 

6.04Liability
of the General Partner.

 

(a)Notwithstanding anything to
the contrary set forth in this Agreement, no Indemnitee shall be liable for monetary damages to the Partnership or any Partners
for losses sustained or liabilities incurred as a result of errors in judgment or mistakes of fact or law or of any act or omission
if any such party acted in good faith. Notwithstanding any provision of this Agreement or otherwise applicable provision of law
or equity, the General Partner shall not be in breach of any duty (fiduciary or otherwise) that the General Partner may owe to
the Limited Partners or the Partnership or any other Persons bound by this Agreement provided the General Partner, acting in good
faith, abides by the terms of this Agreement.

 

(b)Notwithstanding any provision
of this Agreement or otherwise applicable provision of law or equity, the Limited Partners expressly acknowledge that the General
Partner is acting for the benefit of the Partnership, the Limited Partners and the General Partner’s stockholders collectively,
and that, to the fullest extent permitted by law, the General Partner has no duty (fiduciary or otherwise) and is under no obligation
to consider the separate interests of the Limited Partners (including, without limitation, the tax consequences to Limited Partners
or the tax consequences of some, but not all, of the Limited Partners) in deciding whether to cause the Partnership to take (or
decline to take) any actions. In the event of a conflict between the interests of the stockholders of the General Partner on the
one hand and the Limited Partners on the other, the General Partner shall endeavor in good faith to resolve the conflict in a manner
not adverse to either the stockholders of the General Partner or the Limited Partners; provided, however, that for
so long as the General Partner owns a controlling interest in the Partnership, any such conflict that the General Partner, in its
sole and absolute discretion, determines cannot be resolved in a manner not adverse to either the stockholders of the General Partner
or the Limited Partners shall be resolved in favor of the stockholders of the General Partner. The General Partner shall not be
liable to the Partners or the Partnership for monetary damages for losses sustained, liabilities incurred or benefits not derived
by the Limited Partners or the Partnership in connection with such decisions.

 

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(c)Subject to its obligations and
duties as General Partner set forth in Section 6.01 hereof, the General Partner may exercise any of the powers granted to
it under this Agreement and perform any of the duties imposed upon it hereunder either directly or by or through its agents. The
General Partner shall not be responsible or liable to the Limited Partners or the Partnership for any misconduct or negligence
on the part of any such agent appointed by it in good faith.

 

(d)Notwithstanding any other provisions
of this Agreement or the Act, any action of the General Partner on behalf of the Partnership or any decision of the General Partner
to refrain from acting on behalf of the Partnership, undertaken in the good faith belief that such action or omission is necessary
or advisable in order (i) to protect the ability of the General Partner to continue to qualify as a REIT or (ii) to prevent the
General Partner from incurring any taxes under Section 857, Section 4981 or any other provision of the Code, is expressly authorized
under this Agreement and is deemed approved by all of the Limited Partners.

 

(e)Any amendment, modification
or repeal of this Section 6.04 or any provision hereof shall be prospective only and shall not in any way affect the limitations
on the General Partner’s or any of its officer’s, director’s, agent’s or employee’s liability to
the Partnership and the Limited Partners under this Section 6.04 as in effect immediately prior to such amendment, modification
or repeal with respect to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of
when claims relating to such matters may arise or be asserted.

 

6.05Partnership
Obligations.

 

(a)Except as provided in this Section
6.05 and elsewhere in this Agreement (including the provisions of Articles V and VI hereof regarding distributions, payments and
allocations to which it may be entitled), the General Partner shall not be compensated for its services as general partner of the
Partnership.

 

(b)All Administrative Expenses
shall be obligations of the Partnership, and the General Partner shall be entitled to reimbursement by the Partnership for any
expenditure (including Administrative Expenses) incurred on behalf of the Partnership that shall be made other than out of the
funds of the Partnership.

 

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6.06Outside
Activities. Subject to Section 6.08 hereof, the Charter and any agreements entered into by the General Partner or its Affiliates
with the Partnership or a Subsidiary, any officer, director, employee, agent, trustee, Affiliate or stockholders of the General
Partner and the General Partner shall be entitled to and may have business interests and engage in business activities in addition
to those relating to the Partnership, including business interests and activities substantially similar or identical to those of
the Partnership, and the doctrine of corporate opportunity or any analogous doctrine shall not apply to such business interest
or activities. Neither the Partnership nor any of the Limited Partners shall have any rights by virtue of this Agreement in any
such business ventures, interest or activities. None of the Limited Partners nor any other Person bound by this Agreement shall
have any rights by virtue of this Agreement or the partnership relationship established hereby in any such business ventures, interests
or activities, and the General Partner, (i) shall have no duty or obligation (fiduciary or otherwise) pursuant to this Agreement
to offer any interest in any such business ventures, interests and activities to the Partnership or any Limited Partner, even if
such opportunity is of a character that, if presented to the Partnership or any Limited Partner, could be taken by such Person,
and (ii) shall not be liable to the Partnership or to the Limited Partners for breach of any fiduciary or other duty existing at
law, in equity or otherwise by reason of the fact that the General Partner pursues or acquires for, or directs such business ventures,
interests or activities to another Person or does not communicate such opportunity or information to the Partnership.

 

6.07Employment
or Retention of Affiliates.

 

(a)Any Affiliate of the General
Partner may be employed or retained by the Partnership and may otherwise deal with the Partnership (whether as a buyer, lessor,
lessee, manager, furnisher of goods or services, broker, agent, lender or otherwise) and may receive from the Partnership any compensation,
price or other payment therefor that the General Partner determines to be fair and reasonable.

 

(b)The Partnership may lend or
contribute to its Subsidiaries or other Persons in which it has an equity investment, and such Persons may borrow funds from the
Partnership, on terms and conditions established in the sole and absolute discretion of the General Partner. The foregoing authority
shall not create any right or benefit in favor of any Subsidiary or any other Person.

 

(c)The Partnership may transfer
assets to joint ventures, other partnerships, corporations or other business entities in which it is or thereby becomes a participant
upon such terms and subject to such conditions as the General Partner deems are consistent with this Agreement and applicable law.

 

6.08General
Partner Activities. The General Partner agrees that, generally, all business activities of the General Partner, including
activities pertaining to the acquisition, development, ownership of or investment in single tenant freestanding commercial real
estate and related assets, shall be conducted through the Partnership or one or more Subsidiary Partnerships; provided,
however, that, subject to Section 4.02(a)(ii), the General Partner may make direct acquisitions or undertake business activities
if such acquisitions or activities are made in connection with the issuance of Additional Securities by the General Partner or
the business activity has been approved by a majority of the Independent Directors.

 

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6.09Title
to Partnership Assets. Title to Partnership assets, whether real, personal or mixed and whether tangible or intangible,
shall be deemed to be owned by the Partnership as an entity, and no Partner, individually or collectively, shall have any ownership
interest in such Partnership assets or any portion thereof. Title to any or all of the Partnership assets may be held in the name
of the Partnership, the General Partner or one or more nominees, as the General Partner may determine, including Affiliates of
the General Partner. The General Partner hereby declares and warrants that any Partnership assets for which legal title is held
in the name of the General Partner or any nominee or Affiliate of the General Partner shall be held by the General Partner for
the use and benefit of the Partnership in accordance with the provisions of this Agreement; provided, however, that
the General Partner shall use its best efforts to cause beneficial and record title to such assets to be vested in the Partnership
as soon as reasonably practicable. All Partnership assets shall be recorded as the property of the Partnership in its books and
records, irrespective of the name in which legal title to such Partnership assets is held.

 

6.10Redemption
of General Partner’s Partnership Units. In the event the General Partner redeems or repurchases any REIT Shares,
then the General Partner shall cause the Partnership to purchase from the General Partner a number of Partnership Units as determined
based on the application of the Conversion Factor on the same terms that the General Partner redeemed such REIT Shares. Moreover,
if the General Partner makes a cash tender offer or other offer to acquire REIT Shares, then the General Partner shall cause the
Partnership to make a corresponding offer to the General Partner to acquire an equal number of Partnership Units held by the General
Partner. In the event any REIT Shares are redeemed or repurchased by the General Partner pursuant to such offer, the Partnership
shall redeem or repurchase an equivalent number of the General Partner’s Partnership Units for an equivalent purchase price
based on the application of the Conversion Factor.

 

ARTICLE
VII

CHANGES IN GENERAL PARTNER

 

7.01Transfer
of the General Partner’s Partnership Interest.

 

(a)The General Partner shall not
transfer all or any portion of its General Partner Interests, and the General Partner shall not withdraw as General Partner, except
as provided in or in connection with a transaction contemplated by Section 7.01(c) hereof.

 

(b)The General Partner agrees that
its General Partner Interest will at all times be in the aggregate at least 0.1% of the Partnership Interests.

 

(c)Notwithstanding anything in
this Section 7.01, the General Partner may transfer all or any portion of its General Partner Interest to any wholly owned Subsidiary
of the General Partner that is (i) a state law corporation or is eligible to make, and has validly made, an election pursuant to
Treas. Regs. Sec. 301.7701-3 to be treated as an association taxable as a corporation for U.S. federal income tax purposes (ii)
a TRS, or (iii) an entity that is wholly owned by the General Partner and treated as disregarded for federal income tax purposes,
and following a transfer of all of its General Partner Interest, may withdraw as General Partner. In the event that the General
Partner transfers its entire General Partner Interest and the transferee is admitted to the Partnership as a substitute General
Partner in accordance with this Agreement, such transferee shall be deemed admitted to the Partnership as a General Partner immediately
prior to the transfer and such transferee shall continue the business of the Partnership without dissolution.

 

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7.02Merger
of General Partner.

 

(a)Except as otherwise provided
in Section 7.02(b) or (c) hereof, the General Partner shall not engage in any merger, consolidation or other combination with or
into another Person or sale of all or substantially all of its assets (other than in connection with a change in the General Partner’s
state of incorporation or organizational form), in each case which results in a Change of Control of the General Partner (a “Transaction”),
unless at least one of the following conditions is met:

 

(i)the consent of a Majority
in Interest (other than the Percentage Interest held by the General Partner or any Subsidiary of the General Partner) is obtained;

 

(ii)as a result of such
Transaction, all Limited Partners will receive, or have the right to receive, for each Partnership Unit held by such Limited Partners
an amount of cash, securities or other property equal in value to the product of the Conversion Factor and the greatest amount
of cash, securities or other property paid in the Transaction to a holder of one REIT Share in consideration of one REIT Share,
provided, that if, in connection with such Transaction, a purchase, tender or exchange offer (“Offer”)
shall have been made to and accepted by the holders of more than 50% of the outstanding REIT Shares, each holder of Partnership
Units (other than the General Partner and any Subsidiary of the General Partner) shall be given the option to exchange its Partnership
Units for the greatest amount of cash, securities or other property that such Limited Partner would have received had it (A) exercised
its OP Unit Redemption Right pursuant to Section 8.04 hereof and (B) sold, tendered or exchanged pursuant to the Offer the REIT
Shares received upon exercise of the OP Unit Redemption Right immediately prior to the expiration of the Offer; or

 

(iii)the General Partner
is the surviving entity in the Transaction and either (A) the holders of REIT Shares do not receive cash, securities or other property
in the Transaction or (B) all Limited Partners receive for each Partnership Unit held by such Limited Partners an amount of cash,
securities or other property (expressed as an amount per REIT Share) that is no less in value than the product of the Conversion
Factor and the greatest amount of cash, securities or other property (expressed as an amount per REIT Share) received in the Transaction
by any holder of REIT Shares.

 

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(b)Notwithstanding Section 7.02(a)
hereof, the General Partner may merge with or into or consolidate with another entity if immediately after such merger or consolidation
(i) substantially all of the assets of the successor or surviving entity (the “Survivor”), other than Partnership
Units held by the General Partner, are contributed, directly or indirectly, to the Partnership as a Capital Contribution in exchange
for Partnership Units with a fair market value equal to the value of the assets so contributed as determined by the Survivor in
good faith and (ii) the Survivor expressly agrees to assume all obligations of the General Partner hereunder. Notwithstanding any
provision of this Agreement and without the consent of any other person, upon such contribution and assumption, (i) for all purposes
of this Agreement, if the General Partner is not the Survivor, the Survivor, shall be deemed to be the “General Partner”
hereunder and shall be deemed to be admitted as the general partner of the Partnership, upon its execution of a counterpart to
this Agreement, effective simultaneously with the merger or consolidation, (ii) the Survivor shall continue the business of the
Partnership without dissolution, and (iii) the Survivor shall have the right and duty to amend this Agreement as set forth in this
Section 7.02(b) or in any other manner, if applicable, to reflect the change in the general partner of the Partnership. The Survivor
shall in good faith arrive at a new method for the calculation of the Cash Amount, the REIT Shares Amount and Conversion Factor
for a Partnership Unit after any such merger or consolidation so as to approximate the existing method for such calculation as
closely as reasonably possible. Such calculation shall take into account, among other things, the kind and amount of securities,
cash and other property that was receivable upon such merger or consolidation by a holder of REIT Shares or options, warrants or
other rights relating thereto, and which a holder of Partnership Units could have acquired had such Partnership Units been exchanged
immediately prior to such merger or consolidation. Such amendment to this Agreement shall provide for adjustment to such method
of calculation, which shall be as nearly equivalent as may be practicable to the adjustments provided for with respect to the Conversion
Factor. The Survivor also shall in good faith modify the definition of REIT Shares and make such amendments to Section 8.04 hereof
so as to approximate the existing rights and obligations set forth in Section 8.04 hereof as closely as reasonably possible.
The above provisions of this Section 7.02(b) shall similarly apply to successive mergers or consolidations permitted hereunder.

 

Notwithstanding anything in this Section
7.02, the General Partner may engage in a transaction required by law or by the rules of any national securities exchange or over-the-counter
interdealer quotation system on which the REIT Shares are listed or traded.

 

7.03Admission
of a Substitute or Additional General Partner. A Person shall be admitted as a substitute or additional General Partner
of the Partnership only if the following terms and conditions are satisfied:

 

(a)the Person to be admitted as
a substitute or additional General Partner shall have accepted and agreed to be bound by all the terms and provisions of this Agreement
by executing a counterpart hereof, and an amendment to the Certificate of Limited Partnership of the Partnership evidencing the
admission of such Person as a General Partner shall have been filed with the office of the Secretary of State of the State of Delaware;

 

(b)if the Person to be admitted
as a substitute or additional General Partner is a corporation or a partnership, it shall have provided the Partnership with evidence
satisfactory to counsel for the Partnership of such Person’s authority to become a General Partner and to be bound by the
terms and provisions of this Agreement; and

 

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(c)counsel for the Partnership
shall have rendered an opinion (relying on such opinions from other counsel as may be necessary) that the admission of the Person
to be admitted as a substitute or additional General Partner is in conformity with the Act, that none of the actions taken in connection
with the admission of such Person as a substitute or additional General Partner will cause (i) the Partnership to be classified
other than as a partnership for federal income tax purposes, or (ii) the loss of any Limited Partner’s limited liability.

 

7.04Effect
of Bankruptcy, Withdrawal, Death or Dissolution of General Partner.

 

(a)Upon the occurrence of an Event
of Bankruptcy as to the General Partner (and its removal pursuant to Section 7.05(a) hereof) or the withdrawal, removal or dissolution
of the General Partner or any other event that results in the General Partner ceasing to be a general partner of the Partnership
under the Act, the Partnership shall be dissolved and its affairs wound up unless the business of the Partnership is continued
pursuant to Section 7.04(b) hereof. Notwithstanding anything in this Agreement to the contrary, any successor to the General Partner
by merger or consolidation in compliance with Section 7.02(b) shall, without further act of any Person, be the General Partner
hereunder, and such merger or consolidation shall not constitute a transfer for purposes of this Agreement and the Partnership
shall continue without dissolution.

 

(b)Following the occurrence of
an Event of Bankruptcy as to the General Partner (and its removal pursuant to Section 7.05(a) hereof) or the withdrawal, removal
or dissolution of the General Partner or any other event that resulting the General Partner ceasing to be a general partner of
the Partnership under the Act, the Partnership shall not be dissolved or wound up if the Limited Partners, within 90 days after
such occurrence, elect to continue the business of the Partnership for the balance of the term specified in Section 2.04 hereof
by selecting effective as of such occurrence, subject to Section 7.03 hereof in writing or vote, a substitute General Partner by
consent of a Majority in Interest. Any substitute General Partner selected by the Limited Partners in accordance with this Section
7.05(b) and admitted to the Partnership in accordance with Section 7.03, shall be deemed admitted to the Partnership effective
simultaneously with the occurrence of the event that caused the General Partner to cease to be a general partner of the Partnership.
If the Limited Partners elect to continue the business of the Partnership and admit a substitute General Partner, the relationship
with the Partners and of any Person who has acquired an interest of a Partner in the Partnership shall be governed by this Agreement.

 

7.05Removal
of General Partner.

 

(a)Upon the occurrence of an Event
of Bankruptcy as to, or the dissolution of, the General Partner, the General Partner shall be deemed to be removed automatically.
To the fullest extent permitted by law, the Limited Partners may not remove the General Partner, with or without cause.

 

(b)If the General Partner has been
removed pursuant to this Section 7.05 and the Partnership is continued pursuant to Section 7.04 hereof, the General Partner shall
promptly transfer and assign its General Partner Interest in the Partnership to the substitute General Partner approved by a Majority
in Interest in accordance with Section 7.04(b) hereof and otherwise be admitted to the Partnership in accordance with Section 7.03
hereof. At the time of assignment, the removed General Partner shall be entitled to receive from the substitute General Partner
the fair market value of the General Partner Interest of such removed General Partner as reduced by any damages caused to the Partnership
by such General Partner. Such fair market value shall be determined by an appraiser mutually agreed upon by the General Partner
and a Majority in Interest within ten days following the removal of the General Partner. In the event that the parties are unable
to agree upon an appraiser, the removed General Partner and a Majority in Interest each shall select an appraiser. Each such appraiser
shall complete an appraisal of the fair market value of the removed General Partner’s General Partner Interest within 30
days of the General Partner’s removal, and the fair market value of the removed General Partner’s General Partner Interest
shall be the average of the two appraisals; provided, however, that if the higher appraisal exceeds the lower appraisal
by more than 20% of the amount of the lower appraisal, the two appraisers, no later than 40 days after the removal of the General
Partner, shall select a third appraiser who shall complete an appraisal of the fair market value of the removed General Partner’s
General Partner Interest no later than 60 days after the removal of the General Partner. In such case, the fair market value of
the removed General Partner’s General Partner Interest shall be the average of the two appraisals closest in value.

 

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(c)The General Partner Interest
of a removed General Partner, during the time after default until transfer under Section 7.05(b) hereof, shall be converted to
that of a special Limited Partner; provided, however, such removed General Partner shall not have any rights to participate
in the management and affairs of the Partnership, and shall not be entitled to any portion of the income, expense, profit, gain
or loss allocations or cash distributions allocable or payable, as the case may be, to the Limited Partners. Instead, such removed
General Partner shall receive and be entitled only to retain distributions or allocations of such items that it would have been
entitled to receive in its capacity as General Partner, until the transfer is effective pursuant to Section 7.05(b) hereof.

 

(d)Notwithstanding any other provision
of this Agreement, for so long as the General Partner is treated as a REIT for U.S. federal income tax purposes, to the fullest
extent permitted by law, the General Partner shall not be removed unless (a) the General Partner’s economic interest in the
Partnership shall be simultaneously transferred to another entity that is either (i) not an Affiliate of the General Partner or
(ii) a TRS or (b) such removal would not otherwise result in the Partnership having only one partner for U.S. federal income tax
purposes.

 

(e)All Partners shall have given
and hereby do give such consents, shall take such actions and shall execute such documents as shall be legally necessary and sufficient
to effect all the foregoing provisions of this Section 7.05.

 

ARTICLE
VIII

RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS

 

8.01Management
of the Partnership. The Limited Partners shall not participate in the management or control of Partnership business nor
shall they transact any business for the Partnership, nor shall they have the power to sign for or bind the Partnership, such powers
being vested solely and exclusively in the General Partner. Notwithstanding anything to the contrary contained in this Agreement,
none of the actions taken by any of the Limited Partners hereunder shall constitute participation in the control of the business
of the Partnership within the meaning of the Act.

 

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8.02Power
of Attorney. Each Limited Partner hereby irrevocably appoints the General Partner its true and lawful attorney-in-fact,
who may act for each Limited Partner and in its name, place and stead, and for its use and benefit, to sign, acknowledge, swear
to, deliver, file or record, at the appropriate public offices, any and all documents, certificates and instruments as may be deemed
necessary or desirable by the General Partner to carry out fully the provisions of this Agreement and the Act in accordance with
their terms, including duly adapted amendments hereto, which power of attorney is coupled with an interest and shall survive and
not be affected by the subsequent death, dissolution or legal incapacity of the Limited Partner, or the transfer by the Limited
Partner of any part or all of its Partnership Interest. This power of attorney may be exercised by such attorney-in-fact for all
Limited Partners (or any of them) by a single signature of the General Partner acting as attorney-in-fact with or without listing
all of the Limited Partners executing an instrument.

 

8.03Limitation
on Liability of Limited Partners. No Limited Partner, in its capacity as such, shall be liable for any debts, liabilities,
contracts or obligations of the Partnership. Except as otherwise provided in this Agreement or under the Act, a Limited Partner
shall be liable to the Partnership only to make payments of its Capital Contribution, if any, as and when due hereunder. After
its Capital Contribution is fully paid, no Limited Partner shall, except as otherwise required by the Act or as otherwise provided
for herein, be required to make any further Capital Contributions or other payments or lend any funds to the Partnership.

 

8.04OP
Unit Redemption Right.

 

(a)Subject to Sections 8.04(b),
(c), (d), (e), (f) and (g) hereof, the penultimate sentence of this Section 8.04(a), and the provisions of any agreements between
the Partnership and one or more Limited Partners with respect to OP Units held by them, each Limited Partner, shall have the right
(the “OP Unit Redemption Right”) to require the Partnership to redeem on a Specified Redemption Date all or
a portion of the OP Units held by such Limited Partner at a redemption price equal to and in the form of the OP Unit Redemption
Amount to be paid by the Partnership, provided, that such OP Units shall have been outstanding for at least one year (or
such lesser time as determined by the General Partner in its sole and absolute discretion), which period shall include the period
that Partnership Units that were converted into such OP Units were held, and subject to any restriction agreed to in writing between
the Redeeming Limited Partner and the General Partner. The OP Unit Redemption Right shall be exercised pursuant to a Notice of
Exercise of Redemption Right in substantially the form attached hereto as Exhibit B delivered to the Partnership (with a copy to
the General Partner) by the Limited Partner who is exercising the OP Unit Redemption Right (the “Redeeming Limited Partner”);
provided, however, that the Partnership shall, in its sole and absolute discretion, have the option to deliver either
the Cash Amount or the REIT Shares Amount; provided, further, that the Partnership shall not be obligated to satisfy
such OP Unit Redemption Right if the General Partner elects to purchase the OP Units subject to the Notice of Redemption; and provided,
further, that no Limited Partner may deliver more than two Notices of Redemption during each calendar year. A Limited Partner
may not exercise the OP Unit Redemption Right for less than one thousand (1,000) OP Units or, if such Limited Partner holds less
than one thousand (1,000) OP Units, all of the OP Units held by such Limited Partner. Each of the
AREP Limited Partner and the ARCA Limited Partner shall not be permitted to exercise the OP Unit Redemption
Right unless and until such Partner does not have a deficit balance in its Capital Account. The Redeeming Limited
Partner shall have no right, with respect to any OP Units so redeemed, to receive any distribution paid with respect to OP Units
if the record date for such distribution is on or after the Specified Redemption Date.

 

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(b)Notwithstanding the provisions
of Section 8.04(a) hereof, a Limited Partner that exercises the OP Unit Redemption Right shall be deemed to have offered to sell
the OP Units described in the Notice of Redemption to the General Partner, and the General Partner may, in its sole and absolute
discretion, elect to purchase directly and acquire such OP Units by paying to the Redeeming Limited Partner either the Cash Amount
or the REIT Shares Amount, as elected by the General Partner (in its sole and absolute discretion), on the Specified Redemption
Date, whereupon the General Partner shall acquire the OP Units offered for redemption by the Redeeming Limited Partner and shall
be treated for all purposes of this Agreement as the owner of such OP Units. If the General Partner shall elect to exercise its
right to purchase OP Units under this Section 8.04(b) with respect to a Notice of Redemption, it shall so notify the Redeeming
Limited Partner within five business days after the receipt by the General Partner of such Notice of Redemption.

 

In the event the General Partner shall exercise
its right to purchase OP Units with respect to the exercise of a OP Unit Redemption Right, the Partnership shall have no obligation
to pay any amount to the Redeeming Limited Partner with respect to such Redeeming Limited Partner’s exercise of such OP Unit
Redemption Right, and each of the Redeeming Limited Partner, the Partnership and the General Partner shall treat the transaction
between the General Partner and the Redeeming Limited Partner for federal income tax purposes as a sale of the Redeeming Limited
Partner’s OP Units to the General Partner. Each Redeeming Limited Partner agrees to execute such documents as the General
Partner may reasonably require in connection with the issuance of REIT Shares upon exercise of the OP Unit Redemption Right.

 

(c)Notwithstanding the provisions
of Section 8.04(a) and 8.04(b) hereof, a Limited Partner shall not be entitled to exercise the OP Unit Redemption Right if the
delivery of REIT Shares to such Limited Partner on the Specified Redemption Date by the General Partner pursuant to Section 8.04(b)
hereof (regardless of whether or not the General Partner would in fact exercise its rights under Section 8.04(b) hereof) would
(i) result in such Limited Partner or any other Person owning, directly or indirectly, REIT Shares in excess of the Aggregate Share
Ownership Limit or any Excepted Holder Limit (each as defined in Charter) and calculated in accordance therewith, except as provided
in the Charter, (ii) result in REIT Shares being owned by fewer than 100 persons (determined without reference to any rules of
attribution), (iii) result in the General Partner being “closely held” within the meaning of Section 856(h) of the
Code, (iv) cause the General Partner to own, actually or constructively, 10% or more of the ownership interests in a tenant (other
than a TRS) of the General Partner’s, the Partnership’s or a Subsidiary Partnership’s real property, within the
meaning of Section 856(d)(2)(B) of the Code, (v) otherwise cause the General Partner to fail to qualify as a REIT under the Code,
or (vi) cause the acquisition of REIT Shares by such Limited Partner to be “integrated” with any other distribution
of REIT Shares or OP Units for purposes of complying with the registration provisions of the Securities Act. The General Partner,
in its sole and absolute discretion and without the consent of any other Partner or Person, may waive the restriction on redemption
set forth in this Section 8.04(c).

 

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(d)Any Cash Amount to be paid to
a Redeeming Limited Partner pursuant to this Section 8.04 shall be paid on the Specified Redemption Date; provided, however,
that the General Partner may elect to cause the Specified Redemption Date to be delayed for up to an additional 90 days to the
extent required for the General Partner to cause additional REIT Shares to be issued to provide financing to be used to make such
payment of the Cash Amount. Any REIT Share Amount to be paid to a Redeeming Limited Partner pursuant to this Section 8.04
shall be paid on the Specified Redemption Date; provided, however, that the General Partner may elect to cause the
Specified Redemption Date to be delayed for up to an additional 60 days to the extent required for the General Partner to cause
additional REIT Shares to be issued. Notwithstanding the foregoing, the General Partner agrees to use its reasonable best efforts
to cause the closing of the acquisition of redeemed OP Units hereunder to occur as quickly as reasonably possible.

 

(e)Notwithstanding any other provision
of this Agreement, the General Partner is authorized to take any action that it determines to be necessary or appropriate to cause
the Partnership to comply with any withholding requirements established under the Code or any other federal, state or local law
that apply upon a Redeeming Limited Partner’s exercise of the OP Unit Redemption Right. If a Redeeming Limited Partner believes
that it is exempt from such withholding upon the exercise of the OP Unit Redemption Right, such Partner must furnish the General
Partner with a FIRPTA Certificate in substantially the form attached hereto as Exhibit C-1 or Exhibit C-2 and any other documentation
reasonably requested by the General Partner. If the Partnership or the General Partner is required to withhold and pay over to
any taxing authority any amount upon a Redeeming Limited Partner’s exercise of the OP Unit Redemption Right and if the OP
Unit Redemption Amount equals or exceeds the Withheld Amount, the Withheld Amount shall be treated as an amount received by such
Partner in redemption of its OP Units. If, however, the OP Unit Redemption Amount is less than the Withheld Amount, the Redeeming
Limited Partner shall not receive any portion of the OP Unit Redemption Amount, the OP Unit Redemption Amount shall be treated
as an amount received by such Partner in redemption of its OP Units, and the Partner shall contribute the excess of the Withheld
Amount over the OP Unit Redemption Amount to the Partnership before the Partnership is required to pay over such excess to a taxing
authority.

 

(f)Notwithstanding any other provision
of this Agreement, the General Partner shall place appropriate restrictions on the ability of the Limited Partners to exercise
their OP Unit Redemption Rights as and if deemed necessary to ensure that the Partnership does not constitute a “publicly
traded partnership” under Section 7704 of the Code. If and when the General Partner determines that imposing such restrictions
is necessary, the General Partner shall give prompt written notice thereof (a “Restriction Notice”) to each
of the Limited Partners, which notice shall be accompanied by a copy of an opinion of counsel to the Partnership that states that,
in the opinion of such counsel, restrictions are desirable in order to avoid the Partnership being treated as a “publicly
traded partnership” under Section 7704 of the Code.

 

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8.05Registration.
Subject to the terms of any agreement between the General Partner and a Limited Partner with respect to OP Units held by such Limited
Partner that includes provisions relating to registration rights (each a “Separate Registration Rights Agreement”):

 

(a)Shelf Registration of the
REIT Shares. Following the date on which the General Partner becomes eligible to use a registration statement on Form S-3 for
the registration of securities under the Securities Act (the “S-3 Eligible Date”) and within the time period
that may be agreed by the General Partner and a Limited Partner, the General Partner shall file with the Commission a shelf registration
statement under Rule 415 of the Securities Act (a “Registration Statement”), or any similar rule that may be
adopted by the Commission, covering (i) the issuance of REIT Shares issuable upon redemption of the OP Units held by such Limited
Partner (“Redemption Shares”) and/or (ii) the resale by the holder of the Redemption Shares, with respect to
OP Units issued prior to the S-3 Eligible Date; provided, however, that the General Partner shall be required to
file only two such registrations in any 12-month period. In connection therewith, the General Partner will:

 

(1)use its reasonable
best efforts to have such Registration Statement declared effective;

 

(2)furnish to each
holder of Redemption Shares such number of copies of prospectuses, and supplements or amendments thereto, and such other documents
as such holder reasonably requests;

 

(3)register or qualify
the Redemption Shares covered by the Registration Statement under the securities or blue sky laws of such jurisdictions within
the United States as any holder of Redemption Shares shall reasonably request, and do such other reasonable acts and things as
may be required of it to enable such holders to consummate the sale or other disposition in such jurisdictions of the Redemption
Shares; provided, however, that the General Partner shall not be required to (i) qualify as a foreign corporation
or consent to a general or unlimited service or process in any jurisdictions in which it would not otherwise be required to be
qualified or so consent or (ii) qualify as a dealer in securities; and

 

(4)otherwise use its
reasonable best efforts to comply with all applicable rules and regulations of the Commission.

 

The General Partner further agrees to supplement
or make amendments to each Registration Statement, if required by the rules, regulations or instructions applicable to the registration
form utilized by the General Partner or by the Securities Act or rules and regulations thereunder for such Registration Statement.
Each Limited Partner agrees to furnish to the General Partner, upon request, such information with respect to the Limited Partner
as may be required to complete and file the Registration Statement.

 

In connection with and as a condition to
the General Partner’s obligations with respect to the filing of a Registration Statement pursuant to this Section 8.05, each
Limited Partner agrees with the General Partner that:

 

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(x)it will not offer or sell its Redemption
Shares until (A) such Redemption Shares have been included in a Registration Statement and (B) it has received copies of a prospectus,
and any supplement or amendment thereto, as contemplated by Section 8.05(a) hereof, and receives notice that the Registration Statement
covering such Redemption Shares, or any post-effective amendment thereto, has been declared effective by the Commission;

 

(y)if the General Partner determines
in its good faith judgment, after consultation with counsel, that the use of the Registration Statement, including any post effective
amendment thereto, or the use of any prospectus contained in such Registration Statement would require the disclosure of important
information that the General Partner has a bona fide business purpose for preserving as confidential or the disclosure of
which would impede the General Partner’s ability to consummate a significant transaction, upon written notice of such determination
by the General Partner, the rights of each Limited Partner to offer, sell or distribute its Redemption Shares pursuant to such
Registration Statement or prospectus or to require the General Partner to take action with respect to the registration or sale
of any Redemption Shares pursuant to a Registration Statement (including any action contemplated by this Section 8.05) will be
suspended until the date upon which the General Partner notifies such Limited Partner in writing (which notice shall be deemed
sufficient if given through the issuance of a press release) that suspension of such rights for the grounds set forth in this paragraph
is no longer necessary; provided, however, that the General Partner may not suspend such rights for an aggregate
period of more than 90 days in any 12-month period; and

 

(z)in the case of the registration of
any underwritten equity offering proposed by the General Partner (other than any registration by the General Partner on Form S-8,
or a successor or substantially similar form, of (A) an employee share option, share purchase or compensation plan or of securities
issued or issuable pursuant to any such plan or (B) a dividend reinvestment plan), each Limited Partner will agree, if requested
in writing by the managing underwriter or underwriters administering such offering, not to effect any offer, sale or distribution
of any REIT Shares or Redemption Shares (or any option or right to acquire REIT Shares or Redemption Shares) during the period
commencing on the tenth day prior to the expected effective date (which date shall be stated in such notice) of the registration
statement covering such underwritten primary equity offering or, if such offering shall be a “take-down” from an effective
shelf registration statement, the tenth day prior to the expected commencement date (which date shall be stated in such notice)
of such offering, and ending on the date specified by such managing underwriter in such written request to the Limited Partners;
provided, however, that no Limited Partner shall be required to agree not to effect any offer, sale or distribution
of its Redemption Shares for a period of time that is longer than the greater of 90 days or the period of time for which any senior
executive of the General Partner is required so to agree in connection with such offering. Nothing in this paragraph shall be read
to limit the ability of any Limited Partner to redeem its OP Units in accordance with the terms of this Agreement.

 

(b)Listing on Securities Exchange.
If the General Partner lists or maintains the listing of REIT Shares on any securities exchange or national market system, it shall,
at its expense and as necessary to permit the registration and sale of the Redemption Shares hereunder, list thereon, maintain
and, when necessary, increase such listing to include such Redemption Shares.

 

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(c)Registration Not Required.
Notwithstanding the foregoing, the General Partner shall not be required to file or maintain the effectiveness of a registration
statement relating to Redemption Shares after the first date upon which, in the opinion of counsel to the General Partner, all
of the Redemption Shares covered thereby could be sold by the holders thereof pursuant to Rule 144 under the Securities Act, or
any successor rule thereto.

 

(d)Allocation of Expenses.
The Partnership shall pay all expenses in connection with the Registration Statement, including without limitation (i) all expenses
incident to filing with the Financial Industry Regulatory Authority, Inc., (ii) registration fees, (iii) printing expenses, (iv)
accounting and legal fees and expenses, except to the extent holders of Redemption Shares elect to engage accountants or attorneys
in addition to the accountants and attorneys engaged by the General Partner or the Partnership, which fees and expenses for such
accountants or attorneys shall be for the account of the holders of the Redemption Shares, (v) accounting expenses incident to
or required by any such registration or qualification and (vi) expenses of complying with the securities or blue sky laws
of any jurisdictions in connection with such registration or qualification; provided, however, neither the Partnership
nor the General Partner shall be liable for (A) any discounts or commissions to any underwriter or broker attributable to the sale
of Redemption Shares, or (B) any fees or expenses incurred by holders of Redemption Shares in connection with such registration
that, according to the written instructions of any regulatory authority, the Partnership or the General Partner is not permitted
to pay.

 

(e)Indemnification.

 

(i)In connection with
the Registration Statement, to the fullest extent permitted by law, the General Partner and the Partnership agree to indemnify
holders of Redemption Shares within the meaning of Section 15 of the Securities Act, against all losses, claims, damages, liabilities
and expenses (including reasonable costs of investigation) caused by any untrue, or alleged untrue, statement of a material fact
contained in the Registration Statement, preliminary prospectus or prospectus (as amended or supplemented if the General Partner
shall have furnished any amendments or supplements thereto) or caused by any omission or alleged omission, to state therein a material
fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or expenses are caused by any untrue statement, alleged untrue statement, omission, or alleged omission based
upon information furnished to the General Partner by the Limited Partner or the holder of Redemption Shares for use therein. The
General Partner and each officer, director and controlling Person of the General Partner and the Partnership shall be indemnified
by each Limited Partner or holder of Redemption Shares covered by the Registration Statement for all such losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation) caused by any untrue, or alleged untrue, statement or any
omission, or alleged omission, based upon information furnished to the General Partner or the Partnership by the Limited Partner
or the holder for use therein.

 

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(ii)Promptly upon receipt
by a party indemnified under this Section 8.05(e) of notice of the commencement of any action against such indemnified party
in respect of which indemnity or reimbursement may be sought against any indemnifying party under this Section 8.05(e), such indemnified
party shall notify the indemnifying party in writing of the commencement of such action, but the failure to so notify the indemnifying
party shall not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 8.05(e)
unless such failure shall materially adversely affect the defense of such action. In case notice of commencement of any such action
shall be given to the indemnifying party as above provided, the indemnifying party shall be entitled to participate in and, to
the extent it may wish, jointly with any other indemnifying party similarly notified, to assume the defense of such action at its
own expense, with counsel chosen by it and reasonably satisfactory to such indemnified party. The indemnified party shall have
the right to employ separate counsel in any such action and participate in the defense thereof, but the reasonable fees and expenses
of such counsel (other than reasonable costs of investigation) shall be paid by the indemnified party unless (i) the indemnifying
party agrees to pay the same, (ii) the indemnifying party fails to assume the defense of such action with counsel reasonably satisfactory
to the indemnified party or (iii) the named parties to any such action (including any impleaded parties) have been advised by such
counsel that representation of such indemnified party and the indemnifying party by the same counsel would be inappropriate under
applicable standards of professional conduct (in which case the indemnified party shall have the right to separate counsel and
the indemnifying party shall pay the reasonable fees and expenses of such separate counsel, provided, that the indemnifying
party shall not be liable for more than one separate counsel). No indemnifying party shall be liable to any indemnified party for
any settlement entered into without its consent.

 

(f)Contribution.

 

(i)If for any reason
the indemnification provisions contemplated by Section 8.05(e) hereof are either unavailable or insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages or liabilities referred to therein, then the party that would otherwise
be required to provide indemnification or the indemnifying party (in either case, for purposes of this Section 8.05(f), the “Indemnifying
Party”) in respect of such losses, claims, damages or liabilities, shall contribute to the amount paid or payable by
the party that would otherwise be entitled to indemnification or the indemnified party (in either case, for purposes of this Section
8.05(f), the “Indemnified Party”) as a result of such losses, claims, damages, liabilities or expense, in such
proportion as is appropriate to reflect the relative fault of the Indemnifying Party and the Indemnified Party, as well as any
other relevant equitable considerations. The relative fault of the Indemnifying Party and Indemnified Party shall be determined
by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission
to state a material fact related to information supplied by the Indemnifying Party or Indemnified Party, and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed
to include any legal or other fees or expenses reasonably incurred by such party.

 

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(ii)The parties hereto
agree that it would not be just and equitable if contribution pursuant to this Section 8.05(f) were determined by pro rata allocation
(even if the holders were treated as one entity for such purpose) or by any other method of allocation that does not take account
of the equitable considerations referred to in the immediately preceding paragraph. No Person determined to have committed a fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.

 

(iii)The contribution
provided for in this Section 8.05(f) shall survive the termination of this Agreement and shall remain in full force and effect
regardless of any investigation made by or on behalf of any Indemnified Party.

 

(g)Conflict. With respect
to any Limited Partner, in the event of a conflict between the provisions of this Section 8.05 and any Separate Registration Rights
Agreement, the provisions of the Separate Registration Rights Agreement shall control.

 

ARTICLE
IX

TRANSFERS OF PARTNERSHIP INTERESTS

 

9.01Purchase
for Investment.

 

(a)Each Limited Partner, by its
signature below or by its subsequent admission to the Partnership, hereby represents and warrants to the General Partner and to
the Partnership that the acquisition of such Limited Partner’s Partnership Units is made for investment purposes only and
not with a view to the resale or distribution of such Partnership Units.

 

(b)Subject to the provisions of
Section 9.02 hereof, each Limited Partner agrees that such Limited Partner will not Transfer such Limited Partner’s Partnership
Units or any fraction thereof, whether voluntarily or by operation of law or at judicial sale or otherwise, to any Person who does
not make the representations and warranties to the General Partner set forth in Section 9.01(a) hereof.

 

9.02Restrictions
on Transfer of Partnership Units.

 

(a)Subject to the provisions of
Sections 9.02(b), (c) and (d) hereof, to the fullest extent permitted by law, no Limited Partner may offer, sell, assign, hypothecate,
pledge or otherwise transfer all or any portion of such Limited Partner’s Partnership Units, or any of such Limited Partner’s
economic rights as a Limited Partner, whether voluntarily or by operation of law or at judicial sale or otherwise (collectively,
a “Transfer”) without the consent of the General Partner, which consent may be granted or withheld in its sole
and absolute discretion. The General Partner may require, as a condition of any Transfer to which it consents, that the transferor
assume all costs incurred by the Partnership in connection therewith.

 

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(b)No Limited Partner may withdraw
from the Partnership other than as a result of a permitted Transfer (i.e., a Transfer consented to as contemplated by clause
(a) above or clause (c) below or a Transfer pursuant to Section 9.05 hereof) of all of such Limited Partner’s Partnership
Units pursuant to this Article IX or pursuant to a redemption of all of such Limited Partner’s OP Units pursuant to Section
8.04 hereof. Upon the permitted Transfer or redemption of all of a Limited Partner’s OP Units, such Limited Partner shall
cease to be a Limited Partner.

 

(c)Subject to Sections 9.02(d),
(e) and (f) hereof, a Limited Partner may Transfer, with the consent of the General Partner, all or a portion of such Limited Partner’s
Partnership Units to (i) such Limited Partner’s parent or parent’s spouse, (ii) such Limited Partner’s spouse,
(iii) such Limited Partner’s natural or adopted descendant or descendants, (iv) such Limited Partner’s spouse of such
Limited Partner’s descendant, (v) such Limited Partner’s brother or sister, (vi) a trust created by such Limited
Partner for the primary benefit of such Limited Partner and/or any such Person(s) described in (i) through (v) above, of which
trust such Limited Partner or any such Person(s) or bank or other commercial entity in the business of acting as a fiduciary in
its ordinary course of business and having an equity capitalization of at least $100,000,000 is a trustee, (vii) a corporation,
partnership or limited liability company controlled by a Person or Persons named in (i) through (v) above, or (viii) if the Limited
Partner is an entity, its beneficial owners.

 

(d)No Limited Partner may effect
a Transfer of its Partnership Units, in whole or in part, if, in the opinion of legal counsel for the Partnership, such proposed
Transfer would require the registration of the Partnership Units under the Securities Act or would otherwise violate any applicable
federal or state securities or blue sky law (including investment suitability standards).

 

(e)No Transfer by a Limited Partner
of its Partnership Units, in whole or in part, may be made to any Person if the General Partner determines, in its commercially
reasonable discretion, that (i) such Transfer would result in the Partnership being treated as an association taxable as a corporation
(other than a qualified REIT subsidiary within the meaning of Section 856(i) of the Code), (ii) it would adversely affect the ability
of the General Partner to continue to qualify as a REIT or subject the General Partner to any additional taxes under Section 857,
Section 4981 or any other provision of the Code or (iii) such Transfer is effectuated through an “established securities
market” or a “secondary market (or the substantial equivalent thereof)” within the meaning of Section 7704 of
the Code; provided, that if the General Partner secures an opinion of qualified United States tax counsel that the Partnership
would, if such Transfer were completed, satisfy one or more provisions under Section 7704 of the Code and the Regulations promulgated
thereunder such that the Partnership would not be treated as a “publicly traded partnership” for U.S. federal income
tax purposes, then such Transfer shall not be prohibited by this Section 9.02(e).

 

(f)To the fullest extent permitted
by law, any purported Transfer in contravention of any of the provisions of this Article IX shall be void ab initio and
ineffectual and shall not be binding upon, or recognized by, the General Partner or the Partnership.

 

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(g)Prior to the consummation of
any Transfer under this Article IX, the transferor and/or the transferee shall deliver to the General Partner such opinions, certificates
and other documents as the General Partner shall request in connection with such Transfer.

 

(h)Notwithstanding anything to
the contrary contained in this Section 9.02, ARC Real Estate Partners, LLC may Transfer any of its OP Units to its Members (as
defined in the limited liability company agreement of ARC Real Estate Partners, LLC, dated July 26, 2010, by and among
the signatories thereto, as amended from time to time), without the consent of the General Partner.

 

(i)The Partners hereby acknowledge
and agree that a Partner who holds Class B Units or LTIP Units shall not Transfer such Class B Units or LTIP Units other than,
and subject to any restriction on the transfer of Class B Units contained in Article XV or any restriction on the transfer of LTIP
Units contained in Article XVI or the terms of an applicable OPP Agreement, (i) pursuant to Section 9.02(c) hereof, (ii) by operation
of law to the estate of a Partner who held such LTIP Units immediately prior to his or her death or (iii) to the Partnership or
the General Partner.

 

9.03Admission
of Substitute Limited Partner.

 

(a)Subject to the other provisions
of this Article IX, an assignee of the Partnership Units of a Limited Partner (which shall be understood to include any purchaser,
transferee, donee or other recipient of any disposition of such Partnership Units) shall be deemed admitted as a Limited Partner
of the Partnership only with the consent of the General Partner, which consent may be given or withheld by the General Partner
in its sole and absolute discretion, and upon the satisfactory completion of the following:

 

(i)The assignee shall
have accepted and agreed to be bound by the terms and provisions of this Agreement by executing a counterpart or an amendment thereof,
including a revised Exhibit A, and such other documents or instruments as the General Partner may require in order to effect
the admission of such Person as a Limited Partner.

 

(ii)The assignee shall
have delivered a letter containing the representation set forth in Section 9.01(a) hereof and the representations and warranties
set forth in Section 9.01(b) hereof.

 

(iii)If the assignee
is a corporation, partnership or trust, the assignee shall have provided the General Partner with evidence satisfactory to counsel
for the Partnership of the assignee’s authority to become a Limited Partner under the terms and provisions of this Agreement.

 

(iv)The assignee shall
have executed a power of attorney containing the terms and provisions set forth in Section 8.02 hereof.

 

(v)The assignee shall
have paid or reimbursed, and shall hold harmless the General Partner and the Partnership for, all legal fees and other expenses
of the Partnership and the General Partner and filing and publication costs in connection with its substitution as a Limited Partner,
including any applicable transfer taxes or withholding taxes.

 

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(vi)The assignee shall
have obtained the prior written consent of the General Partner to its admission as a Substitute Limited Partner, which consent
may be given or denied in the exercise of the General Partner’s sole and absolute discretion.

 

(b)For the purpose of allocating
Net Income and Net Loss and distributing cash received by the Partnership, a Substitute Limited Partner shall be treated as having
become, and appearing in the records of the Partnership as, a Limited Partner on the later of the date specified in the transfer
documents or the date on which the General Partner has received all necessary instruments of transfer and substitution.

 

(c)The General Partner and the
Substitute Limited Partner shall cooperate with each other by preparing the documentation required by this Section 9.03 and making
all official filings and publications. The Partnership shall take all such action as promptly as practicable after the satisfaction
of the conditions in this Article IX to the admission of such Person as a Limited Partner of the Partnership.

 

9.04Rights
of Assignees of Partnership Units.

 

(a)Subject to the provisions of
Sections 9.01 and 9.02 hereof, except as required by operation of law, the Partnership shall not be obligated for any purposes
whatsoever to recognize the assignment by any Limited Partner of its Partnership Units until the Partnership has received notice
thereof.

 

(b)Any Person who is the assignee
of all or any portion of a Limited Partner’s Partnership Units, but does not become a Substitute Limited Partner and desires
to make a further assignment of such Partnership Units, shall be subject to all the provisions of this Article IX to the same extent
and in the same manner as any Limited Partner desiring to make an assignment of its Partnership Units.

 

9.05Effect
of Bankruptcy, Death, Incompetence or Termination of a Limited Partner. To the fullest extent permitted by law, the occurrence
of an Event of Bankruptcy as to a Limited Partner, the death of a Limited Partner or a final adjudication that a Limited Partner
is incompetent (which term shall include, but not be limited to, insanity) shall not, in and of itself, cause the termination or
dissolution of the Partnership, and the business of the Partnership shall continue, and such Limited Partner’s personal representative
(as defined in the Act) shall have the rights of such Limited Partner for the purpose of settling or managing such Limited Partner’s
estate property and such power as the bankrupt, deceased or incompetent Limited Partner possessed to assign all or any part of
such Limited Partner’s Partnership Units and to join with the assignee in satisfying conditions precedent to the admission
of the assignee as a Substitute Limited Partner.

 

9.06Joint
Ownership of Partnership Units. A Partnership Unit may be acquired by two individuals as joint tenants with right of survivorship,
provided, that such individuals either are married or are related and share the same home as tenants in common. The written
consent or vote of both owners of any such jointly held Partnership Unit shall be required to constitute the action of the owners
of such Partnership Unit; provided, however, that the written consent of only one joint owner will be required if
the Partnership has been provided with evidence satisfactory to the counsel for the Partnership that the actions of a single joint
owner can bind both owners under the applicable laws of the state of residence of such joint owners. Upon the death of one owner
of a Partnership Unit held in a joint tenancy with a right of survivorship, the Partnership Unit shall become owned solely by the
survivor as a Limited Partner and not as an assignee. The Partnership need not recognize the death of one of the owners of a jointly-held
Partnership Unit until it shall have received notice of such death. Upon notice to the General Partner from either owner, the General
Partner shall cause the Partnership Unit to be divided into two equal Partnership Units, which shall thereafter be owned separately
by each of the former owners.

 

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ARTICLE
X

BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS

 

10.01Books
and Records. At all times during the continuance of the Partnership, the General Partner shall keep or cause to be kept
at the Partnership’s specified office true and complete books of account in accordance with generally accepted accounting
principles, including: (a) a current list of the full name and last known business address of each Partner, (b) a copy of
the Certificate of Limited Partnership of the Partnership and all certificates of amendment thereto, (c) copies of the Partnership’s
federal, state and local income tax returns and reports, (d) copies of this Agreement and any financial statements of the Partnership
for the three most recent years and (e) all documents and information required under the Act. Any Limited Partner or its duly authorized
representative, for any purpose reasonably related to such Limited Partner’s interest as a limited partner in the Partnership,
upon paying the costs of collection, duplication and mailing, shall be entitled to inspect or copy such records during ordinary
business hours.

 

10.02Custody
of Partnership Funds; Bank Accounts.

 

(a)All funds of the Partnership
not otherwise invested shall be deposited in one or more accounts maintained in such banking or brokerage institutions as the General
Partner shall determine, and withdrawals shall be made only on such signature or signatures as the General Partner may, from time
to time, determine.

 

(b)All deposits and other funds
not needed in the operation of the business of the Partnership may be invested by the General Partner. The funds of the Partnership
shall not be commingled with the funds of any other Person except for such commingling as may necessarily result from an investment
in those investment companies permitted by this Section 10.02(b).

 

10.03Fiscal
and Taxable Year. The fiscal and taxable year of the Partnership shall be the calendar year unless otherwise required by
the Code.

 

10.04Annual
Tax Information and Report. Within 75 days after the end of each fiscal year of the Partnership, the General Partner shall
furnish to each Person who was a Limited Partner at any time during such year the tax information necessary to file such Limited
Partner’s individual tax returns as shall be reasonably required by law.

 

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10.05Tax
Matters Partner; Tax Elections; Special Basis Adjustments.

 

(a)The General Partner shall be
the Tax Matters Partner of the Partnership. As Tax Matters Partner, the General Partner shall have the right and obligation to
take all actions authorized and required, respectively, by the Code for the Tax Matters Partner. The General Partner shall have
the right to retain professional assistance in respect of any audit of the Partnership by the Service and all out-of-pocket expenses
and fees incurred by the General Partner on behalf of the Partnership as Tax Matters Partner shall constitute Partnership expenses.
In the event the General Partner receives notice of a final Partnership adjustment under Section 6223(a)(2) of the Code, the
General Partner shall either (i) file a court petition for judicial review of such final adjustment within the period provided
under Section 6226(a) of the Code, a copy of which petition shall be mailed to all Limited Partners on the date such petition is
filed, or (ii) mail a written notice to all Limited Partners, within such period, that describes the General Partner’s reasons
for determining not to file such a petition.

 

(b)All elections and determinations
required or permitted to be made by the Partnership under the Code or any applicable state or local tax law shall be made by the
General Partner in its sole and absolute discretion.

 

(c)In the event of a transfer of
all or any part of the Partnership Interest of any Partner, the Partnership, at the option of the General Partner, may elect pursuant
to Section 754 of the Code to adjust the basis of the Properties. Notwithstanding anything contained in Article V of this
Agreement, any adjustments made pursuant to Section 754 shall affect only the successor in interest to the transferring Partner
and in no event shall be taken into account in establishing, maintaining or computing Capital Accounts for the other Partners for
any purpose under this Agreement unless an adjustment to Capital Accounts is permitted under the Regulations promulgated under
Section 704 of the Code. Each Partner will furnish the Partnership with all information necessary to give effect to such election.

 

(d)In the event that the General
Partner shall be removed or replaced pursuant to any provision of this Agreement, the successor to the General Partner shall assume
the obligations of this Section 10.05.

 

(e)The Partners, intending to be
legally bound, hereby authorize the Partnership to make an election (the “Safe Harbor Election”) to have the
“liquidation value” safe harbor provided in Proposed Treasury Regulation § 1.83-3(1) and the Proposed Revenue
Procedure set forth in Internal Revenue Service Notice 2005-43, as such safe harbor may be modified when such proposed guidance
is issued in final form or as amended by subsequently issued guidance (the “Safe Harbor”), apply to any interest
in the Partnership transferred to a service provider while the Safe Harbor Election remains effective, to the extent such interest
meets the Safe Harbor requirements (collectively, such interests are referred to as “Safe Harbor Interests”).
The Tax Matters Partner is authorized and directed to execute and file the Safe Harbor Election on behalf of the Partnership and
the Partners. The Partnership and the Partners (including any Person to whom an interest in the Partnership is transferred in connection
with the performance of services) hereby agree to comply with all requirements of the Safe Harbor (including forfeiture allocations)
with respect to all Safe Harbor Interests and to prepare and file all U.S. federal income tax returns reporting the tax consequences
of the issuance and vesting of Safe Harbor Interests consistent with such final Safe Harbor guidance. The Partnership is also authorized
to take such actions as are necessary to achieve, under the Safe Harbor, the effect that the election and compliance with all requirements
of the Safe Harbor referred to above would be intended to achieve under Proposed Treasury Regulation § 1.83-3, including
amending this Agreement.

 

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10.06Reports
to Limited Partners.

 

(a)If the General Partner is required
to furnish an annual report to its stockholders containing financial statements of the General Partner, the General Partner will,
at the same time and in the same manner, furnish such annual report to each Limited Partner.

 

(b)Any Partner shall further have
the right to a private audit of the books and records of the Partnership, provided, that such audit is made for Partnership
purposes, at the sole expense of the Partner desiring it and is made during normal business hours.

 

ARTICLE
XI

AMENDMENT OF AGREEMENT; MERGER

 

11.01Amendment
of Agreement.

 

Except as otherwise provided herein, the
General Partner’s written consent shall be required for any amendment to this Agreement. Except as otherwise provided herein,
the General Partner, without the consent of the Limited Partners or any other Person, may amend this Agreement in any respect;
provided, however, that the following amendments shall require the written consent of a Majority in Interest:

 

(a)any amendment affecting the
operation of the Conversion Factor or the OP Unit Redemption Right (except as otherwise provided herein) in a manner that adversely
affects the Limited Partners in any material respect;

 

(b)any amendment that would adversely
affect the rights of the Limited Partners in any material respect to receive the distributions payable to them hereunder, other
than with respect to the issuance of additional Partnership Units pursuant to Section 4.02 hereof;

 

(c)any amendment that would alter
the Partnership’s allocations of Net Income and Net Loss to the Limited Partners, other than with respect to the issuance
of additional Partnership Units pursuant to Section 4.02 hereof;

 

(d)any amendment that would impose
on the Limited Partners any obligation to make additional Capital Contributions to the Partnership; or

 

(e)any amendment to this Article
XI.

 

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11.02Merger
of Partnership.

 

Notwithstanding any provision of this Agreement,
the General Partner, without the consent of the Limited Partners or any other Person, may (i) merge or consolidate the Partnership
with or into any other domestic or foreign partnership, limited partnership, limited liability company, corporation or other Person
or (ii) sell all or substantially all of the assets of the Partnership in a transaction pursuant to Section 7.02(a) or (b) hereof
and may amend this Agreement in any manner or adopt a new limited partnership agreement for the Partnership in connection with
any such transaction consistent with the provisions of this Article XI.

 

ARTICLE
XII

MANAGER’S UNITS

 

12.01Designation
and Number. A series of Partnership Units in the Partnership, designated as the “Manager’s Units,” is
hereby established. The number of Manager’s Units shall be 10,000,000. Except as set forth in this Article XII, Manager’s
Units shall have the same rights, privileges and preferences as the OP Units.

 

12.02Voting.
Each Manager’s Unit shall entitle the holder thereof to one vote on all matters submitted to a vote of the holders of Partnership
Units.

 

12.03Distributions.

 

(a)The Partners holding Manager’s
Units shall be entitled to receive distributions of Cash Available for Distribution as follows:

 

(i)prior to the Distribution
Triggering Event, if and when any distributions are paid on OP Units, distributions shall be paid to the Partners holding Manager’s
Units with respect to each outstanding Manager’s Unit in an amount equal to the product of (1) the per-unit amount of such
distribution to be paid on the OP Units multiplied by (2) one (1%) percent (the “Concurrent Manager Distribution”);

 

(ii)upon the Distribution
Triggering Event, to the extent any Manager’s Units remain outstanding, no distributions shall be authorized or paid or set
apart for payment on the OP Units until the Partners holding the Manager’s Units then outstanding have received distributions
equal to an amount per Manager’s Unit equal to the difference between (1) the cumulative distributions paid on an OP Unit
pursuant to Section 5.02(a)(ii) prior to the Distribution Triggering Event and during the period the Partner held such
Manager’s Unit minus (ii) the cumulative Concurrent Manager Distributions paid on such Manager’s Unit; and

 

(iii)after full distributions
pursuant to Section 12.03(a)(ii), the Partner holding Manager’s Units shall be entitled to receive distributions with respect
to such Manager’s Units on such Partnership Record Date established by the General Partner with respect to such distributions
in an amount equal to the distributions per OP Unit to be paid to holders of OP Units.

 

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(b)The Partners holding Manager’s
Units shall be entitled to distributions, if any, of Net Sales Proceeds pursuant to Section 5.02(b)(iii) and distributions in liquidation
of the Partnership pursuant to Section 5.06.

 

12.04Automatic
Unit Conversion.

 

(a)At such times as there occurs
a conversion of Manager’s REIT Shares for REIT Shares, a corresponding amount of Manager’s Units shall automatically
convert into OP Units, on a one-to-one basis (subject to appropriate adjustment in the event of any dividend, split, combination
or other similar recapitalization with respect to the OP Units); provided, however, to the extent any Manager’s
Units remain subject to further vesting requirements, such vesting requirements shall apply to the OP Units into which such Manager’s
Units were converted.

 

(b)Each automatic conversion of
Manager’s Units for OP Units shall be deemed to have been effected at such time as the concurrent conversion of the corresponding
Manager’s REIT Shares for REIT Shares shall have been deemed effected in accordance with the Charter and Exhibit A
hereto shall be amended by the General Partner to reflect such conversion; provided, however, that the holder of
the certificates representing such Manager’s Units, if any, hereby agrees to surrender such certificates representing such
Manager’s Units, if any, to the Partnership, and the Person or Persons in whose name or names any certificate or certificates
for OP Units shall be issuable upon such automatic conversion shall be deemed to have become the holder or holders of record of
the OP Units represented thereby at such time and on such date. As promptly as practicable after the surrender of such certificates,
if any, representing the Manager’s Units, the Partnership shall issue and shall deliver at such office to such holder, or
on his or her written order, a certificate or certificates, if any, for the number of OP Units issuable upon the automatic conversion
of such Manager’s Units in accordance with the provisions of this Section 12.04(b); provided, however, that
the failure to surrender the certificates representing the Manager’s Units as provided in this Section 12.04(b) shall not
preclude the automatic conversion of such Manager’s Units into OP Units.

 

12.05Forfeiture
of Manager’s Units. If any Manager’s REIT Shares are forfeited pursuant to an award agreement relating to such
Manager’s REIT Shares, an equal number of Manager’s Units shall be forfeited by the holder(s) thereof (and the portion
of the holder(s)’ Capital Account attributable to such forfeited Manager’s Units also shall be forfeited).

 

ARTICLE
XIII

SERIES A PREFERRED UNITS

 

13.01Number
of Preferred Units and Designation. A series of preferred Partnership Units in the Partnership, designated as the “Series
A Preferred Units,” is hereby established. The number of Series A Preferred Units shall be 545,454 units. Except as set forth
in Article V and this Article XIII, and except where the context elsewhere in this Agreement otherwise requires, Series A Preferred
Units shall have the same rights, privileges and preferences as the OP Units.

 

13.02Ranking.
The Series A Preferred Units shall, with respect to the payment of distributions and the right to receive the Series A Liquidation
Preference upon a Liquidation, rank junior to all Series A Senior Units; rank senior to all Series A Junior Units, and rank in
parity with all Series A Parity Units.

 

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13.03Distributions.
Distributions with respect to Series A Preferred Units shall be cumulative from the day of issuance of any such Series A Preferred
Units and shall be payable monthly, when, as and if declared by the General Partner, in arrears, on each Series A Distribution
Payment Date. Each such distribution shall be payable to the holders of record of Series A Preferred Units as they appear in the
records of the Partnership at the close of business on such record date, which shall not be more than 30 days preceding such Series
A Distribution Payment Dates thereof, as shall be fixed by the General Partner.

 

13.04Conversion.

 

(a)Unless such Series A Preferred
Units have previously been redeemed pursuant to Section 13.05, at such time as there occurs a conversion of shares of Series A
Preferred Stock for REIT Shares, a corresponding amount of Series A Preferred Units shall automatically convert into OP Units,
on a one-to-one basis (subject to appropriate adjustment in the event of any dividend, split, combination or other similar recapitalization
with respect to the OP Units) on terms substantially similar to the terms for conversion of shares of Series A Preferred Stock
for REIT Shares contained in the Series A Articles Supplementary.

 

(b)Each automatic conversion of
Series A Preferred Units for OP Units shall be deemed to have been effected at such time as the concurrent conversion of the corresponding
shares of Series A Preferred Stock for REIT Shares shall have been deemed effected in accordance with the Charter, and Exhibit
A shall be amended by the General Partner to reflect such conversion.

 

13.05Redemption.
If the General Partner redeems or otherwise purchases any shares of Series A Preferred Stock, the Partnership shall redeem a corresponding
number of Series A Preferred Units, on the date of redemption or other purchase of shares of Series A Preferred Stock by the General
Partner (“Series A Redemption Date”), at a redemption price per Series A Preferred Unit equal to the sum of
(a) the Series A Liquidation Preference plus (b) the accrued but unpaid Series A Preferred Return plus (c) the Series A Redemption
Premium, and the redemption price shall be payable in cash. Any redemption of Series A Preferred Units shall be deemed to occur
on the Series A Redemption Date immediately prior to the related redemption or other purchase of Shares of Series A Preferred Stock.

 

13.06Voting.

 

(a)Other than as expressly provided
in below in this Section 13.06, the Series A Preferred Units shall not have any voting rights or powers, and the consent of the
holders thereof, shall not be required for the taking of any Partnership action.

 

(b)As long as any of the Series
A Preferred Units shall remain outstanding, the Partnership shall not, and the General Partner shall not have the authority to
cause the Partnership to, take any of the following actions without the prior written consent of holders owning at least sixty-six
and two-thirds percent (66 and 2/3%) of the Series A Preferred Units then issued and outstanding, voting as a single class, in
person or by proxy:

 

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(i)Effectuate amendments
to the Agreement that would materially adversely affect the terms and conditions of, or the voting powers, rights, privileges or
preferences of the holders of the Series A Preferred Units; provided, however, that amendments to the Agreement to
authorize or create or to increase the number of authorized units of any Series A Senior Units, Series A Parity Units or Series
A Junior Units shall not be deemed to materially adversely affect the voting powers, rights or preferences of the Series A Preferred
Units.

 

13.07Transfers.
Subject to the provisions of Section 9.02(b), (c) and (d), no Limited Partner may Transfer such Limited Partner’s Series
A Preferred Unit without the prior written consent of the General Partner, which may be withheld or denied by the General Partner
it is sole and absolute discretion. Notwithstanding anything in this Agreement to the contrary, any Transfer in contravention of
this Section 13.07 shall be void and ineffectual and shall not be binding upon, or recognized by the Partnership.

 

13.08Miscellaneous.

 

(a)Series A Preferred Units will
not have any designations, preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions,
qualifications or terms and conditions of redemption, other than those specifically set forth herein and as may be provided under
applicable law.

 

(b)The preferences, conversion
and other rights, voting powers, restrictions, limitations as to distributions, qualifications and terms and conditions of redemption
of the Series A Preferred Units may be waived, and any of such provisions of the Series A Preferred Units may be amended, with
the approval of holders of at least sixty-six and two-thirds percent (66 and 2/3%) of the issued outstanding Series A Preferred
Units, voting as a single class in person or by proxy.

 

ARTICLE
XIV

SERIES B PREFERRED UNITS

 

14.01Number
of Preferred Units and Designation. A series of preferred Partnership Units in the Partnership, designated as the “Series
B Preferred Units,” is hereby established. The number of Series B Preferred Units shall be 283,018 units. Except as set forth
in Article V and this Article XIV, and except where the context elsewhere in this Agreement otherwise requires, Series B Preferred
Units shall have the same rights, privileges and preferences as the OP Units.

 

14.02Ranking.
The Series B Preferred Units shall, with respect to the payment of distributions and the right to receive the Series B Liquidation
Preference upon a Liquidation, rank junior to all Series B Senior Units; rank senior to all Series B Junior Units, and rank in
parity with all Series B Parity Units.

 

14.03Distributions.
Distributions with respect to Series B Preferred Units shall be cumulative from the day of issuance of any such Series B Preferred
Units and shall be payable monthly, when, as and if declared by the General Partner, in arrears, on each Series B Distribution
Payment Date. Each such distribution shall be payable to the holders of record of Series B Preferred Units as they appear in the
records of the Partnership at the close of business on such record date, which shall not be more than 30 days preceding such Series
B Distribution Payment Dates thereof, as shall be fixed by the General Partner.

 

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14.04Conversion.

 

(a)Unless such Series B Preferred
Units have previously been redeemed pursuant to Section 14.05, at such time as there occurs a conversion of shares of Series B
Preferred Stock for REIT Shares, a corresponding amount of Series B Preferred Units shall automatically convert into OP Units,
on a one-to-one basis (subject to appropriate adjustment in the event of any dividend, split, combination or other similar recapitalization
with respect to the OP Units) on terms substantially similar to the terms for conversion of shares of Series B Preferred Stock
for REIT Shares contained in the Series B Articles Supplementary.

 

(b)Each automatic conversion of
Series B Preferred Units for OP Units shall be deemed to have been effected at such time as the concurrent conversion of the corresponding
shares of Series B Preferred Stock for REIT Shares shall have been deemed effected in accordance with the Charter, and Exhibit
A shall be amended by the General Partner to reflect such conversion.

 

14.05Redemption.
If the General Partner redeems or otherwise purchases any shares of Series B Preferred Stock, the Partnership shall redeem
a corresponding number of Series B Preferred Units, on the date of redemption or other purchase of shares of Series B Preferred
Stock by the General Partner (“Series B Redemption Date”), at a redemption price per Series B Preferred Unit
equal to the sum of (a) the Series B Liquidation Preference plus (b) the accrued but unpaid Series B Preferred Return plus (c)
the Series B Redemption Premium, and the redemption price shall be payable in cash. Any redemption of Series B Preferred Units
shall be deemed to occur on the Redemption Date immediately prior to the related redemption or other purchase of Shares of Series
B Preferred Stock.

 

14.06Voting.

 

(a)Other than as expressly provided
in below in this Section 14.06, the Series B Preferred Units shall not have any voting rights or powers, and the consent of the
holders thereof, shall not be required for the taking of any Partnership action.

 

(b)As long as any of the Series
B Preferred Units shall remain outstanding, the Partnership shall not, and the General Partner shall not have the authority to
cause the Partnership to, take any of the following actions without the prior written consent of holders owning at least sixty-six
and two-thirds percent (66 and 2/3%) of the Series B Preferred Units then issued and outstanding, voting as a single class, in
person or by proxy:

 

(i)Effectuate amendments to
the Partnership Agreement that would materially adversely affect the terms and conditions of, or the voting powers, rights, privileges
or preferences of the holders of the Series B Preferred Units; provided, however, that amendments to the Agreement
to authorize or create or to increase the number of authorized units of any Series B Senior Units, Series B Parity Units or Series
B Junior Units shall not be deemed to materially adversely affect the voting powers, rights or preferences of the Series B Preferred
Units.

 

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14.07Transfers.
Subject to the provisions of Section 9.02(b), (c) and (d), no Limited Partner may Transfer such Limited Partner’s Series
B Preferred Unit without the prior written consent of the General Partner, which may be withheld or denied by the General Partner
it is sole and absolute discretion. Notwithstanding anything in this Agreement to the contrary, any Transfer in contravention of
this Section 14.07 shall be void and ineffectual and shall not be binding upon, or recognized by the Partnership.

 

14.08Miscellaneous.

 

(a)Series B Preferred Units will
not have any designations, preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions,
qualifications or terms and conditions of redemption, other than those specifically set forth herein and as may be provided under
applicable law.

 

(b)The preferences, conversion
and other rights, voting powers, restrictions, limitations as to distributions, qualifications and terms and conditions of redemption
of the Series B Preferred Units may be waived, and any of such provisions of the Series B Preferred Units may be amended, with
the approval of holders of at least sixty-six and two-thirds percent (66 and 2/3%) of the issued outstanding Series B Preferred
Units, voting as a single class in person or by proxy.

 

ARTICLE
XV

CLASS B UNITS

 

15.01Designation
and Number.

 

(a)A series of Partnership Units
in the Partnership, designated as the “Class B Units,” is hereby established. Except as set forth in this Article 15,
Class B Units shall have the same rights, privileges and preferences as the OP Units. Subject to the provisions of this Article
XV and the special provisions of Section 5.01(c)(iii), Class B Units shall be treated as Partnership Units, with all of the rights,
privileges and obligations attendant thereto.

 

(b)It is intended that the Partnership
shall maintain at all times a one-to-one correspondence between Class B Units and OP Units for conversion and other purposes. If
an Adjustment Event occurs, then the General Partner shall make a corresponding adjustment to the Class B Units to maintain a one-for-one
conversion and economic equivalence ratio between OP Units and Class B Units. If more than one Adjustment Event occurs, the adjustment
to the Class B Units need be made only once using a single formula that takes into account each and every Adjustment Event as if
all Adjustment Events occurred simultaneously. If the Partnership takes an action affecting the OP Units other than actions specifically
described in the definition of Adjustment Events and, in the opinion of the General Partner such action would require an adjustment
to the Class B Units to maintain the one-to-one correspondence described above, the General Partner shall have the right to make
such adjustment to the Class B Units, to the extent permitted by law, in such manner and at such time as the General Partner, in
its sole discretion, may determine to be appropriate under the circumstances. If an adjustment is made to the Class B Units as
herein provided, the Partnership shall promptly file in the books and records of the Partnership an officer’s certificate
setting forth such adjustment and a brief statement of the facts requiring such adjustment, which certificate shall be conclusive
evidence of the correctness of such adjustment absent manifest error. Promptly after the filing of such certificate, the Partnership
shall mail a notice to each holder of Class B Units setting forth the adjustment to his, her or its Class B Units and the effective
date of such adjustment.

 

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15.02Special
Provisions. Class B Units shall be subject to the following special provisions:

 

(a)Distributions. The holders
of Class B Units shall be entitled to (i) current distributions of Cash Available for Distribution pursuant to Section 5.02(a)(ii),
(ii) distributions, if any, of Net Sales Proceeds pursuant to Section 5.02(b)(iii), and (iii) distributions in liquidation of the
Partnership pursuant to Section 5.06.

 

(b)Allocations. Holders
of Class B Units shall be entitled to certain special allocations of Net Property Gain under Section 5.01(c)(iii). Except in connection
with Net Property Gain, holders of Class B Units shall be allocated Net Income no greater than the amount of distributions made
pursuant to Section 5.02(a)(ii).

 

(c)Redemption. The OP Unit
Redemption Right provided to Limited Partners under Section 8.04 hereof shall not apply with respect to Class B Units unless
and until the Class B Units are converted to OP Units as provided in Section 15.04.

 

15.03Voting.

 

(a)Holders of Class B Units shall
(x) have the same voting rights as the Limited Partners, with the Class B Units voting as a single class with the OP Units and
having one vote per Class B Unit; and (y) have the additional voting rights that are expressly set forth below. So long as any
Class B Units remain outstanding, the Partnership shall not, without the affirmative vote of the holders of at least a majority
of the Class B Units outstanding at the time, given in person or by proxy, either in writing or at a meeting (voting separately
as a class), amend, alter or repeal, whether by merger, consolidation or otherwise, the provisions of this Agreement applicable
to Class B Units so as to materially and adversely affect any right, privilege or voting power of the Class B Units or the holders
of Class B Units as such, unless such amendment, alteration, or repeal affects equally, ratably and proportionately the rights,
privileges and voting powers of the Limited Partners; but subject, in any event, to the following provisions:

 

(i)With respect to any
OP Unit Transaction, so long as the Class B Units are treated in accordance with Section 15.04(d) hereof, the consummation
of such OP Unit Transaction shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting
powers of the Class B Units or the holders of Class B Units as such; and

 

(ii)Any creation or issuance
of any Partnership Units or of any class or series of Partnership Interest including additional OP Units or Class B Units whether
ranking senior to, junior to, or on a parity with the Class B Units with respect to distributions and the distribution of assets
upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges
or voting powers of the Class B Units or the holders of Class B Units as such.

 

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(b)The foregoing voting provisions
will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required, all outstanding
Class B Units shall have been converted into OP Units.

 

15.04Conversion
of Class B Units.

 

(a)Conversion. At such time
as the Class B Economic Capital Account Balance attributable to a Class B Unit is equal to the OP Unit Economic Balance, each such
balance determined on a per unit basis as of the effective date of conversion (the “Class B Conversion Date”),
such Class B Unit shall automatically convert into one fully paid and non-assessable OP Unit, giving effect to all adjustments
(if any) made pursuant to Section 15.01 hereof; provided, that a Class B Unit shall not be convertible into OP Units
if the Class B Economic Capital Account Balance attributable to such Class B Unit is negative. Each holder of Class B Units covenants
and agrees with the Partnership that all Class B Units to be converted pursuant to this Section 15.04 shall be free and clear
of all liens. The conversion of Class B Units shall occur automatically after the close of business on the applicable Conversion
Date without any action on the part of such holder of Class B Units, as of which time such holder of Class B Units shall be credited
on the books and records of the Partnership with the issuance as of the opening of business on the next day of the number of OP
Units issuable upon such conversion. For purposes of determining the Class B Economic Capital Account Balance attributable to a
Class B Unit, allocations pursuant to Section 5.01(c)(iii) shall be made in such a manner so as to allow the greatest number of
Class B Units to convert pursuant to this Section 15.04 at any time.

 

(b)Adjustment to Gross Asset
Value.

 

(i)The General Partner
shall provide the holders of Class B Units the opportunity but not the obligation to make Capital Contributions to the Partnership
in exchange for OP Units in order to cause an adjustment to the Gross Asset Value of the Partnership’s assets within the
meaning of paragraph (b)(i) of the definition of Gross Asset Value up to two (2) times each fiscal year including if the Partnership
or the General Partner shall be a party to any OP Unit Transaction; provided, that the General Partner shall give each holder
of Class B Units written notice of such OP Unit Transaction at least thirty (30) days prior to entering into any definitive agreement
pursuant to which the OP Unit Transaction would be consummated;

 

(ii)For purposes of clause
(i) of this Section 15.04(b), the value of each OP Unit issued in order to cause an adjustment to the Gross Asset Value of the
Partnership’s assets shall be an amount equal to the product of (y) the Value of one REIT Share as of the date the holder
of Class B Units makes a Capital Contribution to the Partnership multiplied by (z) the Conversion Factor.

 

(iii)For the avoidance
of doubt, the issuance of Class B Units shall be treated as an event allowing for an adjustment to the Gross Asset Value of the
Partnership’s assets within the meaning of paragraph (b)(iv) of the definition of Gross Asset Value.

 

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(c)Impact of Conversion for
Purposes of Section 5.01(c)(iii). For purposes of making future allocations under Section 5.01(c)(iii), the portion of the
Class B Economic Capital Account Balance of the applicable holder of Class B Units that is treated as attributable to his, her
or its Class B Units shall be reduced, as of the date of conversion, by the product of the number of Class B Units converted and
the OP Unit Economic Balance.

 

(d)OP Unit Transactions.
Immediately prior to or concurrent with an OP Unit Transaction the maximum number of Class B Units then eligible for conversion
(in accordance with the provisions of Section 15.04(a)) shall automatically be converted into an equal number of OP Units, giving
effect to all adjustments (if any) made pursuant to Section 15.01 hereof, taking into account any allocations that occur in connection
with the OP Unit Transaction or that would occur in connection with the OP Unit Transaction if the assets of the Partnership were
sold at the OP Unit Transaction price or, if applicable, at a value determined by the General Partner in good faith using the value
attributed to the Partnership Units in the context of the OP Unit Transaction (in which case the Conversion Date shall be the effective
date of the OP Unit Transaction). In anticipation of such OP Unit Transaction, the Partnership shall use commercially reasonable
efforts to cause each holder of Class B Units to be afforded the right to receive in connection with such OP Unit Transaction in
consideration for the OP Units into which his, her or its Class B Units will be converted the same kind and amount of cash, securities
and other property (or any combination thereof) receivable upon the consummation of such OP Unit Transaction by a holder of the
same number of OP Units, assuming such holder of OP Units is not a Person with which the Partnership consolidated or into which
the Partnership merged or which merged into the Partnership or to which such sale or transfer was made, as the case may be (a “Constituent
Person”), or an affiliate of a Constituent Person. In the event that holders of OP Units have the opportunity to elect
the form or type of consideration to be received upon consummation of the OP Unit Transaction, prior to such OP Unit Transaction
the General Partner shall give prompt written notice to each holder of Class B Units of such election, and shall use commercially
reasonable efforts to afford the holders of Class B Units the right to elect, by written notice to the General Partner, the form
or type of consideration to be received upon conversion of each Class B Unit held by such holder into OP Units in connection with
such OP Unit Transaction. If a holder of Class B Units fails to make such an election, such holder (and any of its transferees)
shall receive upon conversion of each Class B Unit held by him, her or it (or by any of his, her or its transferees) the same kind
and amount of consideration that a holder of an OP Unit would receive if such OP Unit holder failed to make such an election. The
Partnership shall use commercially reasonable effort to cause the terms of any OP Unit Transaction to be consistent with the provisions
of this Section 15.04(d) and to enter into an agreement with the successor or purchasing entity, as the case may be, for the
benefit of any holders of Class B Units whose Class B Units will not be converted into OP Units in connection with the OP Unit
Transaction that will (i) contain provisions enabling the holders of Class B Units that remain outstanding after such OP Unit
Transaction to convert their Class B Units into securities as comparable as reasonably possible under the circumstances to the
OP Units and (ii) preserve as far as reasonably possible under the circumstances the distribution, special allocation, conversion,
and other rights set forth in this Agreement for the benefit of the holders of Class B Units.

 

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15.05Profits
Interests.

 

(a)Class B Units are intended to
qualify as a “profits interest” in the Partnership issued to a new or existing Partner in a partner capacity for services
performed or to be performed to or for the benefit of the Partnership within the meaning of Rev. Proc. 93-27, 1993-2 C.B. 343,
and Rev. Proc. 2001-43, 2001-2 C.B. 191, the Code, the Regulations, and other future guidance provided by the IRS with respect
thereto, and the allocations under Section 5.01(c)(iii) shall be interpreted in a manner that is consistent therewith.

 

(b)The Partners agree that the
General Partner may make a Safe Harbor Election, on behalf of itself and of all Partners, to have the Safe Harbor apply irrevocably
with respect to Class B Units transferred in connection with the performance of services by a Partner in a partner capacity. The
Safe Harbor Election shall be effective as of the date of issuance of such Class B Units. If such election is made, (i) the Partnership
and each Partner agree to comply with all requirements of the Safe Harbor with respect to all interests in the Partnership transferred
in connection with the performance of services by a Partner in a partner capacity, whether such Partner was admitted as a Partner
or as the transferee of a previous Partner, and (ii) the General Partner shall cause the Partnership to comply with all record-keeping
requirements and other administrative requirements with respect to the Safe Harbor as shall be required by proposed or final regulations
relating thereto.

 

(c)The Partners agree that if a
Safe Harbor Election is made by the General Partner, (A) each Class B Unit issued hereunder is a Safe Harbor Interest, (B) each
Class B Unit represents a profits interest received for services rendered or to be rendered to or for the benefit of the Partnership
by such holder of Class B Units in his, her or its capacity as a Partner or in anticipation of becoming a Partner, and (C) the
fair market value of each Class B Unit issued by the Partnership upon receipt by such holder of Class B Units as of the date of
issuance is zero (plus the amount, if any, of any Capital Contributions made to the Partnership by such holder of Class B Units
in connection with the issuance of such Class B Unit), representing the liquidation value of such interest upon receipt (with such
valuation being consented to and hereby approved by all Partners).

 

(d)Each Partner, by signing this
Agreement or by accepting such transfer, hereby agrees (A) to comply with all requirements of any Safe Harbor Election made by
the General Partner with respect to each holder of Class B Units’ Safe Harbor Interest, (B) that each holder of Class B Units
shall take into account of all items of income, gain, loss, deduction and credit associated with its Class B Units as if they were
fully vested in computing its federal income tax liability for the entire period during which it holds the Class B Units, (C) that
neither the Partnership nor any Partner shall claim a deduction (as wages, compensation or otherwise) for the fair market value
of such Class B Units issued to a holder of such Class B Units, either at the time of grant of the Class B Units or at the time
the Class B Units becomes substantially vested, and (D) that to the extent that such profits interest is forfeited after the date
hereof, the Partnership shall make special forfeiture allocations of gross items of income, deduction or loss (including, as may
be permitted by or under Regulations (or other rules promulgated) to be adopted, notional items of income, deduction or loss) in
accordance with the Regulations to be adopted under Sections 704(b) and 83 of the Code.

 

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(e)The General Partner shall file
or cause the Partnership to file all returns, reports and other documentation as may be required, as reasonably determined by the
General Partner, to perfect and maintain any Safe Harbor Election made by the General Partner with respect to granting of each
holder of Class B Units’ Safe Harbor Interest.

 

(f)The General Partner is hereby
authorized and empowered, without further vote or action of the Partners, to amend this Agreement to the extent necessary or helpful
in accordance with the advice of Partnership tax counsel or accountants to sustain the Partnership’s position that (A) it
has complied with the Safe Harbor requirements in order to provide for a Safe Harbor Election and it has ability to maintain the
same, or (B) the issuance of the Class B Units is not a taxable event with respect to the holders of Class B Units, and the General
Partner shall have the authority to execute any such amendment by and on behalf of each Partner pursuant to the power of attorney
granted by this Agreement. Any undertaking by any Partner necessary or desirable to (A) enable or preserve a Safe Harbor Election
or (B) otherwise to prevent the issuance of Class B Units from being a taxable event with respect to the holders of Class B Units
may be reflected in such amendments and, to the extent so reflected, shall be binding on each Partner.

 

(g)Each Partner agrees to cooperate
with the General Partner to perfect and maintain any Safe Harbor Election, and to timely execute and deliver any documentation
with respect thereto reasonably requested by the General Partner, at the expense of the Partnership.

 

(h)No Transfer of any interest
in the Partnership by a Partner shall be effective unless prior to such Transfer, the assignee or intended recipient of such interest
shall have agreed in writing to be bound by the provisions of Section 10.05(e) and this Section 15.05, in a form reasonably satisfactory
to the General Partner.

 

(i)The provisions of this Section
15.05 shall apply regardless of whether or not a holder of Class B Units files an election pursuant to Section 83(b) of the Code.

 

(j)The General Partner may amend
this Section 15.05 as it deems necessary or appropriate to maximize the tax benefit of the issuance of Class B Units to any holder
of Class B Units if there are changes in the law or Regulations concerning the issuance of partnership interests for services.

 

ARTICLE
XVI

LTIP UNITS

 

16.01LTIP
Units.

 

(a)Issuance of LTIP Units.
Pursuant to an OPP Agreement or otherwise, the General Partner may, from time to time, issue LTIP Units to Persons who have provided,
or will provide, services to the Partnership or the General Partner for such consideration (if any) as the General Partner may
determine to be appropriate, and admit such Persons as Limited Partners. Subject to the following provisions of this Section 16.01
and the special provisions of Sections 16.02 and 5.01(c)(iv) hereof, LTIP Units shall be treated as Partnership Units,
with all of the rights, privileges and obligations attendant thereto. For purposes of computing the Partners’ Percentage
Interests, LTIP Unitholders shall be treated as holders of OP Units and LTIP Units shall be treated as OP Units. It is intended
that the Partnership shall maintain at all times a one-to-one correspondence between LTIP Units and OP Units for conversion, distribution
and other purposes, including without limitation complying with the following procedures:

 

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(i)If an Adjustment Event
occurs, then the General Partner shall make a corresponding adjustment to the LTIP Units to maintain a one-for-one conversion and
economic equivalence ratio between OP Units and LTIP Units. If more than one Adjustment Event occurs, the adjustment to the LTIP
Units need be made only once using a single formula that takes into account each and every Adjustment Event as if all Adjustment
Events occurred simultaneously. If the Partnership takes an action affecting the OP Units other than actions specifically described
in the definition of Adjustment Events and, in the opinion of the General Partner such action would require an adjustment to the
LTIP Units to maintain the one-to-one correspondence described above, the General Partner shall have the right to make such adjustment
to the LTIP Units, to the extent permitted by law and by any OPP Agreement, in such manner and at such time as the General Partner,
in its sole discretion, may determine to be appropriate under the circumstances. If an adjustment is made to the LTIP Units as
herein provided, the Partnership shall promptly file in the books and records of the Partnership an officer’s certificate
setting forth such adjustment and a brief statement of the facts requiring such adjustment, which certificate shall be conclusive
evidence of the correctness of such adjustment absent manifest error. Promptly after the filing of such certificate, the Partnership
shall mail a notice to each LTIP Unitholder setting forth the adjustment to his or her LTIP Units and the effective date of such
adjustment; and

 

(ii)Distributions.
Unless otherwise provided in an LTIP Award, the LTIP Unitholders shall, when, as and if authorized and declared by the General
Partner out of assets legally available for that purpose, be entitled to receive distributions of Cash Available for Distribution
as follows:

 

(1)prior to the date
as of which an LTIP Unit is earned pursuant to the terms of an OPP Agreement (the “LTIP Unit Distribution Participation
Date”), distributions shall be paid to the LTIP Unitholder with respect to the LTIP Unit in an amount equal to the product
of (A) the distributions per OP Unit to be paid to holders of OP Units on such Partnership Record Date established by the General
Partner with respect to such distribution times (B) ten (10%) percent (the “Concurrent LTIP Distribution”);

 

(2)upon the LTIP Unit
Distribution Participation Date with respect to an LTIP Unit, the LTIP Unitholder shall be entitled to receive distributions per
LTIP Unit equal to the difference between (A) the cumulative distributions that were paid on each OP Unit prior to the LTIP Unit
Distribution Participation Date and during the period the LTIP Unitholder held such LTIP Unit, less (B) the Concurrent LTIP Distributions
paid on such LTIP Unit; and

 

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(3)after full distributions
pursuant to Section 16.01(a)(ii)(2) and subsequent to the LTIP Unit Distribution Participation Date with respect to an LTIP Unit,
the LTIP Unitholder shall be entitled to receive distributions with respect to such LTIP Unit, on such Partnership Record Date
established by the General Partner with respect to such distribution, in an amount equal to the distributions per OP Unit to be
paid to holders of OP Units.

 

So long as any LTIP Units
are outstanding, no distributions (whether in cash or in kind) shall be authorized, declared or paid on OP Units unless distributions
have been or contemporaneously are authorized, declared and paid on the LTIP Units (excluding distributions in liquidation of the
Partnership or a Partner’s interest therein, subject to the Capital Account distribution requirement of Section 5.06 hereof);
provided, that notwithstanding anything to the contrary in this Section 16.01(a)(ii), the General Partner may adjust, as
it deems appropriate, the distributions provided for in this Section 16.01(a)(ii) so as not to cause any LTIP Units to fail to
qualify as profits interests.

 

(b)Priority. Subject to
the provisions of this Section 16.01 and the special provisions of Sections 16.02 and 5.01(c)(iv), the LTIP Units shall rank pari
passu with the OP Units as to the payment of regular and special periodic or other distributions and, subject to Section 5.06
hereof, distribution of assets upon liquidation, dissolution or winding up. As to the payment of distributions upon liquidation,
dissolution or winding up, any class or series of OP Units or Partnership Interests which by its terms specifies that it shall
rank junior to, on a parity with, or senior to the OP Units shall also rank junior to, or pari passu with, or senior to,
respectively, the LTIP Units.

 

(c)Special Provisions. LTIP
Units shall be subject to the following special provisions:

 

(i)LTIP Awards.
LTIP Units may, in the sole discretion of the General Partner, be issued subject to vesting, forfeiture and additional restrictions
on transfers pursuant to the terms of an OPP Agreement. The terms of any OPP Agreement may be modified by the General Partner from
time to time in its sole discretion, subject to any restrictions on amendment imposed by the relevant OPP Agreement pursuant to
which such LTIP Award was issued. LTIP Units that have vested under the terms of an OPP Agreement are referred to as “Vested
LTIP Units”; all other LTIP Units shall be treated as “Unvested LTIP Units.”

 

(ii)Forfeiture.
Unless otherwise specified in the OPP Agreement, upon the occurrence of any event specified in a OPP Agreement as resulting in
either the right of the Partnership or the General Partner to repurchase LTIP Units at a specified purchase price or some other
forfeiture of any LTIP Units, if the Partnership or the General Partner exercises such right of repurchase or forfeiture in accordance
with the applicable OPP Agreement, the relevant LTIP Units shall immediately, and without any further action, be treated as cancelled
and no longer outstanding for any purpose. Unless otherwise specified in the OPP Agreement, no consideration or other payment shall
be due with respect to any LTIP Units that have been forfeited, other than any distributions declared with respect to a Partnership
Record Date prior to the effective date of the forfeiture. In connection with any repurchase or forfeiture of LTIP Units, the LTIP
Economic Capital Account Balance of the LTIP Unitholder with respect to remaining LTIP Units, if any, shall be reduced by the amount,
if any, by which it exceeds the target balance contemplated by Section 5.01(c)(iv), with respect to such remaining LTIP Units.

 

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(iii)Allocations.
LTIP Unitholders shall be entitled to certain special allocations of Net Property Gain under Sections 5.01(c)(iv). Except in connection
with Net Property Gain, LTIP Unitholders shall be allocated Net Income no greater than the amount of distributions made pursuant
to Section 16.01(a)(ii).

 

(iv)Redemption.
The OP Unit Redemption Right provided to Limited Partners under Section 8.04 hereof shall not apply with respect to LTIP
Units unless and until the LTIP Units are converted to OP Units as provided in clause (v) below and Section 16.02.

 

(v)Conversion to OP
Units. Vested LTIP Units are eligible to be converted into OP Units in accordance with Section 16.02.

 

(vi)Legend. Any
certificate evidencing an LTIP Unit shall bear an appropriate legend indicating that additional terms, conditions and restrictions
on transfer, including without limitation any LTIP Award, apply to the LTIP Unit.

 

(d)Voting. LTIP Unitholders
shall (a) have the same voting rights as the Limited Partners, with the LTIP Units voting as a single class with the OP Units and
having one vote per LTIP Unit; and (b) have the additional voting rights that are expressly set forth below. So long as any LTIP
Units remain outstanding, the Partnership shall not, without the affirmative vote of the holders of at least a majority of the
LTIP Units outstanding at the time, given in person or by proxy, either in writing or at a meeting (voting separately as a class),
amend, alter or repeal, whether by merger, consolidation or otherwise, the provisions of this Agreement applicable to LTIP Units
so as to materially and adversely affect any right, privilege or voting power of the LTIP Units or the LTIP Unitholders as such,
unless such amendment, alteration, or repeal affects equally, ratably and proportionately the rights, privileges and voting powers
of the Limited Partners; but subject, in any event, to the following provisions:

 

(i)With respect to any
OP Unit Transaction, so long as the LTIP Units are treated in accordance with Section 16.02(f), the consummation of such OP
Unit Transaction shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers of
the LTIP Units or the LTIP Unitholders as such; and

 

(ii)Any creation or issuance
of any Partnership Units or of any class or series of Partnership Interest including without limitation additional OP Units or
LTIP Units whether ranking senior to, junior to, or on a parity with the LTIP Units with respect to distributions and the distribution
of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences,
privileges or voting powers of the LTIP Units or the LTIP Unitholders as such.

 

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The foregoing voting provisions will
not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required, all outstanding
LTIP Units shall have been converted into OP Units.

 

(e)Liquidation Value of LTIP
Units upon Issuance, and Safe Harbor Election.

 

(i)LTIP Units are intended
to qualify as a “profits interest” in the Partnership issued to a new or existing Partner in a partner capacity for
services performed or to be performed to or for the benefit of the Partnership within the meaning of Rev. Proc. 93-27, 1993-2 C.B.
343, and Rev. Proc. 2001-43, 2001-2 C.B. 191, the Code, the Regulations, and other future guidance provided by the IRS with respect
thereto, and the allocations under Section 5.01(c)(iv) shall be interpreted in a manner that is consistent therewith.

 

(ii)The Partners agree
that the General Partner may make a Safe Harbor Election, on behalf of itself and of all Partners, to have the Safe Harbor apply
irrevocably with respect to LTIP Units transferred in connection with the performance of services by a Partner in a partner capacity.
The Safe Harbor Election shall be effective as of the date of issuance of such LTIP Units. If such election is made, (A) the Partnership
and each Partner agree to comply with all requirements of the Safe Harbor with respect to all interests in the Partnership transferred
in connection with the performance of services by a Partner in a partner capacity, whether such Partner was admitted as a Partner
or as the transferee of a previous Partner, and (B) the General Partner shall cause the Partnership to comply with all record-keeping
requirements and other administrative requirements with respect to the Safe Harbor as shall be required by proposed or final regulations
relating thereto.

 

(iii)The Partners agree
that if a Safe Harbor Election is made by the General Partner, (A) each LTIP Unit issued hereunder is a Safe Harbor Interest, (B)
each LTIP Unit represents a profits interest received for services rendered or to be rendered to or for the benefit of the Partnership
by the LTIP Unitholder in his or her capacity as a Partner or in anticipation of becoming a Partner, and (C) the fair market value
of each LTIP Unit issued by the Partnership upon receipt by the LTIP Unitholder as of the date of issuance is zero (plus the amount,
if any, of any Capital Contributions made to the Partnership by such LTIP Unitholder in connection with the issuance of such LTIP
Unit), representing the liquidation value of such interest upon receipt (with such valuation being consented to and hereby approved
by all Partners).

 

(iv)Each Partner, by
signing this Agreement or by accepting such transfer, hereby agrees (A) to comply with all requirements of any Safe Harbor Election
made by the General Partner with respect to each LTIP Unitholder’s Safe Harbor Interest, (B) that each LTIP Unitholder shall
take into account of all items of income, gain, loss, deduction and credit associated with its LTIP Units as if they were fully
vested in computing its federal income tax liability for the entire period during which it holds the LTIP Units, (C) that neither
the Partnership nor any Partner shall claim a deduction (as wages, compensation or otherwise) for the fair market value of such
LTIP Units issued to a holder of such LTIP Units, either at the time of grant of the LTIP Units or at the time the LTIP Units become
substantially vested, and (D) that to the extent that such profits interest is forfeited after the date hereof, the Partnership
shall make special forfeiture allocations of gross items of income, deduction or loss (including, as may be permitted by or under
Regulations (or other rules promulgated) to be adopted, notional items of income, deduction or loss) in accordance with the Regulations
to be adopted under Sections 704(b) and 83 of the Code.

 

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(v)The General Partner
shall file or cause the Partnership to file all returns, reports and other documentation as may be required, as reasonably determined
by the General Partner, to perfect and maintain any Safe Harbor Election made by the General Partner with respect to granting of
each LTIP Unitholder’s Safe Harbor Interest.

 

(vi)The General Partner
is hereby authorized and empowered, without further vote or action of the Partners, to amend this Agreement to the extent necessary
or helpful in accordance with the advice of Partnership tax counsel or accountants to sustain the Partnership’s position
that (A) it has complied with the Safe Harbor requirements in order to provide for a Safe Harbor Election and it has ability to
maintain the same, or (B) the issuance of the LTIP Units is not a taxable event with respect to the LTIP Unitholders, and the General
Partner shall have the authority to execute any such amendment by and on behalf of each Partner pursuant to the power of attorney
granted by this Agreement. Any undertaking by any Partner necessary or desirable to (A) enable or preserve a Safe Harbor Election
or (B) otherwise to prevent the issuance of LTIP Units to LTIP Unitholders from being a taxable event may be reflected in such
amendments and, to the extent so reflected, shall be binding on each Partner.

 

(vii)Each Partner agrees
to cooperate with the General Partner to perfect and maintain any Safe Harbor Election, and to timely execute and deliver any documentation
with respect thereto reasonably requested by the General Partner, at the expense of the Partnership.

 

(viii)No Transfer of
any interest in the Partnership by a Partner shall be effective unless prior to such Transfer, the assignee or intended recipient
of such interest shall have agreed in writing to be bound by the provisions of this Section 16.01(e), in a form reasonably satisfactory
to the General Partner.

 

(ix)The provisions of
this Section 16.01(e) shall apply regardless of whether or not an LTIP Unitholder files an election pursuant to Section 83(b) of
the Code.

 

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(x)The General Partner
may amend this Section 16.01(e) as it deems necessary or appropriate to maximize the tax benefit of the issuance of LTIP Units
to any LTIP Unitholder if there are changes in the law or Regulations concerning the issuance of partnership interests for services.

 

16.02Conversion
of LTIP Units.

 

(a)Conversion Right. Subject
to Section 16.02(b), an LTIP Unitholder shall have the right (the “LTIP Conversion Right”), at his or
her option, at any time to convert all or a portion of his or her Vested LTIP Units into OP Units; provided, however,
that a holder may not exercise the LTIP Conversion Right for less than one thousand (1,000) Vested LTIP Units or, if such holder
holds less than one thousand Vested LTIP Units, all of the Vested LTIP Units held by such holder. LTIP Unitholders shall not have
the right to convert Unvested LTIP Units into OP Units until they become Vested LTIP Units; provided, however, that
when an LTIP Unitholder is notified of the expected occurrence of an event that will cause his or her Unvested LTIP Units to become
Vested LTIP Units, such LTIP Unitholder may give the Partnership an LTIP Conversion Notice conditioned upon and effective as of
the time of vesting and such LTIP Conversion Notice, unless subsequently revoked by the LTIP Unitholder, shall be accepted by the
Partnership subject to such condition. The General Partner shall have the right at any time to cause a conversion of Vested LTIP
Units into OP Units. In all cases, the conversion of any LTIP Units into OP Units shall be subject to the conditions and procedures
set forth in this Section 16.02.

 

(b)Exercise by an LTIP Unitholder.
A holder of Vested LTIP Units may convert such LTIP Units into an equal number of fully paid and non-assessable OP Units, giving
effect to all adjustments (if any) made pursuant to Section 16.01 hereof. Notwithstanding the foregoing, in no event may a
holder of Vested LTIP Units convert a number of Vested LTIP Units that exceeds (x) the LTIP Economic Capital Account Balance
of such Limited Partner, divided by (y) the OP Unit Economic Balance, in each case as determined as of the effective date
of conversion (the “Capital Account Limitation”). In order to exercise his or her LTIP Conversion Right, an
LTIP Unitholder shall deliver a notice (an “LTIP Conversion Notice”) in the form attached as Exhibit D
to the Partnership (with a copy to the General Partner) not less than ten nor more than 60 days prior to a date (the “LTIP
Conversion Date”) specified in such LTIP Conversion Notice; provided, however, that if the General Partner
has not given to the LTIP Unitholders notice of a proposed or upcoming OP Unit Transaction at least 30 days prior to the effective
date of such OP Unit Transaction, then LTIP Unitholders shall have the right to deliver an LTIP Conversion Notice until the earlier
of (x) the tenth day after such notice from the General Partner of a OP Unit Transaction or (y) the third business day
immediately preceding the effective date of such OP Unit Transaction. An LTIP Conversion Notice shall be provided in the manner
provided in Section 17.01 hereof. Each LTIP Unitholder covenants and agrees with the Partnership that all Vested LTIP Units
to be converted pursuant to this Section 16.02(b) shall be free and clear of all liens. Notwithstanding anything herein to
the contrary, a holder of LTIP Units may deliver a Notice of Redemption pursuant to Section 8.04(a) hereof relating to those
OP Units that will be issued to such holder upon conversion of such LTIP Units into OP Units in advance of the LTIP Conversion
Date; provided, however, that the redemption of such OP Units by the Partnership shall in no event take place until
after the LTIP Conversion Date. For clarity, it is noted that the objective of this paragraph is to put an LTIP Unitholder in a
position where, if he or she so wishes, the OP Units into which his or her Vested LTIP Units will be converted can be redeemed
by the Partnership simultaneously with such conversion, with the further consequence that, if the General Partner elects to assume
the Partnership’s redemption obligation with respect to such OP Units under Section 8.04(b) hereof by delivering to
such holder REIT Shares rather than cash, then such holder can have such REIT Shares issued to him or her simultaneously with the
conversion of his or her Vested LTIP Units into OP Units. The General Partner and LTIP Unitholder shall reasonably cooperate with
each other to coordinate the timing of the events described in the foregoing sentence.

 

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(c)Forced Conversion. The
Partnership, at any time at the election of the General Partner, may cause any number of Vested LTIP Units held by an LTIP Unitholder
to be converted (a “Forced Conversion”) into an equal number of OP Units, giving effect to all adjustments (if
any) made pursuant to Section 16.01 hereof; provided, however, that the Partnership may not cause Forced Conversion
of any LTIP Units that would not at the time be eligible for conversion at the option of such LTIP Unitholder pursuant to Section 16.02(b)
hereof. In order to exercise its right of Forced Conversion, the Partnership shall deliver a notice (a “Forced Conversion
Notice”) in the form attached as Exhibit E to the applicable LTIP Unitholder not less than ten nor more than
60 days prior to the LTIP Conversion Date specified in such Forced Conversion Notice. A Forced Conversion Notice shall be provided
in the manner provided in Section 17.01 hereof.

 

(d)Completion of Conversion.
A conversion of Vested LTIP Units for which the holder thereof has given an LTIP Conversion Notice or the Partnership has given
a Forced Conversion Notice shall occur automatically after the close of business on the applicable LTIP Conversion Date without
any action on the part of such LTIP Unitholder, as of which time such LTIP Unitholder shall be credited on the books and records
of the Partnership with the issuance as of the opening of business on the next day of the number of OP Units issuable upon such
conversion.

 

(e)Impact of Conversion for
Purposes of Section 5.01(c)(iv). For purposes of making future allocations under Section 5.01(c)(iv) hereof and applying
the Capital Account Limitation, the portion of the LTIP Economic Capital Account Balance of the applicable LTIP Unitholder shall
be reduced, as of the date of conversion, by the product of the number of LTIP Units converted and the OP Unit Economic Balance.

 

(f)OP Unit Transactions.
If the Partnership or the General Partner shall be a party to any OP Unit Transaction, then the General Partner shall, immediately
prior to the OP Unit Transaction, exercise its right to cause a Forced Conversion with respect to the maximum number of LTIP Units
then eligible for conversion, taking into account any allocations that occur in connection with the OP Unit Transaction or that
would occur in connection with the OP Unit Transaction if the assets of the Partnership were sold at the OP Unit Transaction price
or, if applicable, at a value determined by the General Partner in good faith using the value attributed to the Partnership Units
in the context of the OP Unit Transaction (in which case the LTIP Conversion Date shall be the effective date of the OP Unit Transaction).
In anticipation of such Forced Conversion and the consummation of the OP Unit Transaction, the Partnership shall use commercially
reasonable efforts to cause each LTIP Unitholder to be afforded the right to receive in connection with such OP Unit Transaction
in consideration for the OP Units into which his or her LTIP Units will be converted the same kind and amount of cash, securities
and other property (or any combination thereof) receivable upon the consummation of such OP Unit Transaction by a holder of the
same number of OP Units, assuming such holder of OP Units is not a Constituent Person, or an affiliate of a Constituent Person.
In the event that holders of OP Units have the opportunity to elect the form or type of consideration to be received upon consummation
of the OP Unit Transaction, prior to such OP Unit Transaction the General Partner shall give prompt written notice to each LTIP
Unitholder of such election, and shall use commercially reasonable efforts to afford the LTIP Unitholders the right to elect, by
written notice to the General Partner, the form or type of consideration to be received upon conversion of each LTIP Unit held
by such holder into OP Units in connection with such OP Unit Transaction. If an LTIP Unitholder fails to make such an election,
such holder (and any of its transferees) shall receive upon conversion of each LTIP Unit held him or her (or by any of his or her
transferees) the same kind and amount of consideration that a holder of a OP Unit would receive if such OP Unit holder failed to
make such an election. Subject to the rights of the Partnership and the General Partner under any OPP Agreement, the Partnership
shall use commercially reasonable effort to cause the terms of any OP Unit Transaction to be consistent with the provisions of
this Section 16.02(f) and to enter into an agreement with the successor or purchasing entity, as the case may be, for the
benefit of any LTIP Unitholders whose LTIP Units will not be converted into OP Units in connection with the OP Unit Transaction
that will (i) contain provisions enabling the holders of LTIP Units that remain outstanding after such OP Unit Transaction
to convert their LTIP Units into securities as comparable as reasonably possible under the circumstances to the OP Units and (ii) preserve
as far as reasonably possible under the circumstances the distribution, special allocation, conversion, and other rights set forth
in this Agreement for the benefit of the LTIP Unitholders.

 

    	85

    	 

    

 

ARTICLE
XVII

GENERAL PROVISIONS

 

17.01Notices.
All communications required or permitted under this Agreement shall be in writing and shall be deemed to have been given when delivered
personally or upon deposit in the United States mail, registered, postage prepaid return receipt requested, to the Partners at
the addresses set forth in Exhibit A attached hereto, as it may be amended or restated from time to time; provided,
however, that any Partner may specify a different address by notifying the General Partner in writing of such different
address. Notices to the General Partner and the Partnership shall be delivered at or mailed to the Partnership’s office address
set forth in Section 2.03 hereof. The General Partner and the Partnership may specify a different address by notifying the Limited
Partners in writing of such different address.

 

17.02Survival
of Rights. Subject to the provisions hereof limiting transfers, this Agreement shall be binding upon and inure to the benefit
of the Partners and the Partnership and their respective legal representatives, successors, transferees and assigns.

 

17.03Additional
Documents. Each Partner agrees to perform all further acts and execute, swear to, acknowledge and deliver all further documents
that may be reasonable, necessary, appropriate or desirable to carry out the provisions of this Agreement or the Act.

 

    	86

    	 

    

 

17.04Severability.
If any provision of this Agreement shall be declared illegal, invalid or unenforceable in any jurisdiction, then such provision
shall be deemed to be severable from this Agreement (to the extent permitted by law) and in any event such illegality, invalidity
or unenforceability shall not affect the remainder hereof.

 

17.05Entire
Agreement. Except for the Contribution Agreement and the Tax Protection Agreement, this Agreement and exhibits attached
hereto constitute the entire Agreement of the Partners and supersede all prior written agreements and prior and contemporaneous
oral agreements, understandings and negotiations with respect to the subject matter hereof. In furtherance of the foregoing, the
Partners acknowledge that the Amended Agreement is hereby superseded in its entirety and this Agreement amends and restates any
prior agreement of limited partnership of the Partnership.

 

17.06Pronouns
and Plurals. When the context in which words are used in the Agreement indicates that such is the intent, words in the
singular number shall include the plural and the masculine gender shall include the neuter or female gender as the context may
require.

 

17.07Headings.
The Article headings or sections in this Agreement are for convenience only and shall not be used in construing the scope of this
Agreement or any particular Article.

 

17.08Counterparts.
This Agreement may be executed in several counterparts, each of which shall be deemed to be an original copy and all of which together
shall constitute one and the same instrument binding on all parties hereto, notwithstanding that all parties shall not have signed
the same counterpart.

 

17.09Governing
Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware.

 

[SIGNATURE PAGE FOLLOWS]

 

    	87

    	 

    

 

IN WITNESS WHEREOF, the parties hereto have
hereunder affixed their signatures to this Amended and Restated Agreement of Limited Partnership, all as of the 28th day of February,
2013.

 

	 	GENERAL PARTNER:
	 	 
	 	American Realty Capital Properties, Inc.
	 	 
	 	By:	/s/ Nicholas S. Schorsch
	 	 	Name: Nicholas S. Schorsch
	 	 	Title: Chief Executive Officer

 

    	88

    	 

    
 

 

EXHIBIT A

 

    	Exhibit 1

    	 

    

 

EXHIBIT
B

NOTICE OF EXERCISE OF OP UNIT REDEMPTION RIGHT

 

In accordance with Section 8.04 of the Amended
and Restated Agreement of Limited Partnership (as amended, the “Agreement”) of ARC Properties Operating Partnership,
L.P., the undersigned hereby irrevocably (i) presents for redemption ___________ OP Units in ARC Properties Operating Partnership,
L.P. in accordance with the terms of the Agreement and the OP Unit Redemption Right referred to in Section 8.04 thereof, (ii) surrenders
such OP Units and all right, title and interest therein and (iii) directs that the Cash Amount or REIT Shares Amount (as defined
in the Agreement) as determined by the Partnership deliverable upon exercise of the OP Unit Redemption Right be delivered to the
address specified below, and if REIT Shares (as defined in the Agreement) are to be delivered, such REIT Shares be registered or
placed in the name(s) and at the address(es) specified below.

 

Dated: __________ ___, ___

Name of Limited Partner:

 

	 	(Signature of Limited Partner)
	 	 
	 	(Mailing Address)
	 	 
	 	(City) (State) (Zip Code)
	 	 
	 	Signature Guaranteed by:

 

f REIT Shares are to be issued, issue to:

Please insert social security or identifying number:

Name:

 

    	Exhibit 1

    	 

    

 

EXHIBIT
C-1

CERTIFICATION OF NON-FOREIGN STATUS

(FOR REDEEMING LIMITED PARTNERS THAT ARE ENTITIES)

 

Under Section 1445(e) of the Internal Revenue
Code of 1986, as amended (the “Code”), in the event of a disposition by a non-U.S. person of a partnership interest
in a partnership in which (i) 50% or more of the value of the gross assets consists of United States real property interests (“USRPIs”),
as defined in Section 897(c) of the Code, and (ii) 90% or more of the value of the gross assets consists of USRPIs, cash, and cash
equivalents, the transferee will be required to withhold 10% of the amount realized by the non-U.S. person upon the disposition.
To inform American Realty Capital Properties, Inc. (the “General Partner”) and ARC Properties Operating Partnership,
L.P. (the “Partnership”) that no withholding is required with respect to the redemption by ___________ (“Partner”)
of its OP Units in the Partnership, the undersigned hereby certifies the following on behalf of Partner:

 

		1.	Partner is not a foreign corporation, foreign partnership, foreign trust, or foreign estate, as those terms are defined in
the Code and the Treasury regulations thereunder.

 

		2.	Partner is not a disregarded entity as defined in Treasury Regulation Section 1.1445-2(b)(2)(iii).

 

		3.	The U.S. employer identification number of Partner is ____________.

 

		4.	The principal business address of Partner is: ___________________, ____________ and Partner’s place of incorporation
is ___________.

 

		5.	Partner agrees to inform the General Partner if it becomes a foreign person at any time during the three-year period immediately
following the date of this notice.

 

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

 

	 	PARTNER:
	 	 
	 	 	 	 
	 	By:	 
	 	 	Name: 	 
	 	 	Title: 	 

 

    	Exhibit C-1-1

    	 

    

 

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

 

Date:

 

	 	Name:
	 	 
	 	Title:

 

    	Exhibit C-1-2

    	 

    

 

EXHIBIT
C-2

CERTIFICATION OF NON-FOREIGN STATUS

(FOR REDEEMING LIMITED PARTNERS THAT ARE INDIVIDUALS)

 

Under Section 1445(e) of the Internal Revenue
Code of 1986, as amended (the “Code”), in the event of a disposition by a non-U.S. person of a partnership interest
in a partnership in which (i) 50% or more of the value of the gross assets consists of United States real property interests (“USRPIs”),
as defined in Section 897(c) of the Code, and (ii) 90% or more of the value of the gross assets consists of USRPIs, cash, and cash
equivalents, the transferee will be required to withhold 10% of the amount realized by the non-U.S. person upon the disposition.
To inform American Realty Capital Properties, Inc. (the “General Partner”) and ARC Properties Operating Partnership,
L.P. (the “Partnership”) that no withholding is required with respect to my redemption of my OP Units in the
Partnership, I, ____________, hereby certify the following:

 

		1.	I am not a nonresident alien for purposes of U.S. income taxation.

 

		2.	My U.S. taxpayer identification number (social security number) is _____________.

 

		3.	My home address is: _______________________________________.

 

		4.	I agree to inform the General Partner promptly if I become a nonresident alien at any time during the three-year period immediately
following the date of this notice.

 

		5.	I understand that this certification may be disclosed to the Internal Revenue Service by the General Partner and that any false
statement contained herein could be punished by fine, imprisonment, or both.

 

	 	Name:

 

Under penalties of perjury, I declare that I have examined this
certification and, to the best of my knowledge and belief, it is true, correct, and complete.

 

Date:

 

	 	Name:
	 	 
	 	Title:

 

    	Exhibit C-2-1

    	 

    

 

EXHIBIT D

NOTICE OF ELECTION BY PARTNER TO CONVERT

LTIP UNITS INTO OP UNITS

 

The undersigned holder of LTIP Units hereby
irrevocably (i) elects to convert the number of LTIP Units in ARC Properties Operating Partnership, L.P. (the “Partnership”)
set forth below into OP Units in accordance with the terms of the Amended and Restated Agreement of Limited Partnership of the
Partnership, as amended; and (ii) directs that any cash in lieu of OP Units that may be deliverable upon such conversion be
delivered to the address specified below. The undersigned hereby represents, warrants, and certifies that the undersigned (a) has
title to such LTIP Units, free and clear of the rights or interests of any other person or entity other than the Partnership; (b) has
the full right, power, and authority to cause the conversion of such LTIP Units as provided herein; and (c) has obtained the
consent to or approval of all persons or entities, if any, having the right to consent or approve such conversion.

  

	Name of Holder:	
	 	(Please Print: Exact Name as Registered with Partnership)

 

Number of LTIP Units to be Converted: __________________

 

Date of this Notice: __________________

 

	 	
	 	(Signature of Holder: Sign Exact Name as Registered with Partnership)
	 	 
	 	
	 	(Street Address)

 

	 		 	 
	 	(City)	(State)	(Zip Code)
	 	 	 	 
	 	Signature Guaranteed by: 	 

 

 

    	Exhibit D-1

    	 

    

 

EXHIBIT E

NOTICE OF ELECTION BY PARTNERSHIP
TO FORCE CONVERSION OF

LTIP UNITS INTO OP UNITS

 

ARC Properties Operating Partnership, L.P.
(the “Partnership”) hereby irrevocably elects to cause the number of LTIP Units held by the holder of LTIP Units set
forth below to be converted into OP Units in accordance with the terms of the Amended and Restated Agreement of Limited Partnership
of the Partnership, as amended.

 

 

	Name of Holder:	
	 	(Please Print: Exact Name as Registered with Partnership)

 

Number of LTIP Units to be Converted: __________________

 

Date of this Notice: __________________

 

    	Exhibit E-1AMENDED AND RESTATED MANAGEMENT AGREEMENT

by and between

American Realty Capital Properties, Inc.

and

ARC Properties Advisors, LLC

Dated as of February 28, 2013

 

 

 

 

 

 

 

    	 

    	 	

    
 

AMENDED AND RESTATED
MANAGEMENT AGREEMENT, dated as of February 28, 2013, by and between American Realty Capital Properties, Inc., a Maryland corporation
(the “Company”), and ARC Properties Advisors, LLC, a Delaware limited liability company (the “Manager”).

 

W
I T N E S S E T H:

 

WHEREAS, the Company
is a corporation which has elected to be taxed as, and qualifies as, a real estate investment trust for federal income tax purposes
within the meaning of Section 856 of the Internal Revenue Code of 1986, as amended (the “Code”);

 

WHEREAS, the Company
and the Manager are parties to that certain Management Agreement, dated as of September 6, 2011 (the “Original Agreement”),
pursuant to which the Manager administers the business activities and day-to-day operations of the Company and performs services
for the Company in the manner and on the terms set forth therein;

 

WHEREAS, the Company,
ARC Properties Operating Partnership, L.P., a Delaware limited partnership and the operating partnership of the Company, Tiger
Acquisition, LLC, a Delaware limited liability company wholly-owned by the Company (“Merger Sub”), American
Realty Capital Trust III, Inc., a Maryland corporation (“Target”) and American Realty Capital Operating Partnership
III, L.P., a Delaware limited partnership and the operating partnership of Target, are parties to that certain Agreement and Plan
of Merger, dated as of December 14, 2012 (the “Merger Agreement”), pursuant to which Target will be merged with
and into Merger Sub, with Merger Sub being the surviving entity (the “Merger”);

 

WHEREAS, as a condition
to entering into the Merger Agreement, Target requested that the Company obtain the Manager’s consent to reduce the base
management fee payable pursuant to the Original Agreement for all assets held by the Company above an unadjusted book value of
$3.0 billion from 0.50% per annum to 0.40% per annum, in each case of the unadjusted book value of such assets, in response to
which the Manager agreed, pursuant to a letter agreement dated December 14, 2012, to modify the terms of the Original Agreement
to reflect such base management fee reduction;

 

WHEREAS, the Merger
has been consummated concurrently with the execution of this Agreement; and

 

WHEREAS, the Company
and the Manager desire to amend and restate the Original Agreement in its entirety.

 

NOW THEREFORE, in consideration
of the premises and agreements hereinafter set forth, the parties hereto hereby agree as follows:

 

Section 1. Definitions.

 

(a)The following
terms shall have the meanings set forth in this Section 1(a):

 

“Affiliate”
means, with respect to any Person, (i) any Person directly or indirectly controlling, controlled by, or under common control with
such specified Person, (ii) any executive officer or general partner of such specified Person, (iii) any member of the board of
directors or board of managers (or bodies performing similar functions) of such specified Person, and (iv) any legal entity for
which such specified Person acts as an executive officer or general partner. For purposes of this definition, the terms “controlling”,
“controlled by”, or “under common control with” shall mean the possession, direct or indirect, of the power
to direct or cause the direction of the management and policies of an entity, whether through the ownership of voting securities,
by contract or credit arrangement, as trustee or executor, or otherwise.

 

    	 

    	 	

    
 

“Acquisition
Expenses” means any and all expenses incurred by the Company, the Subsidiaries, the Manager or any of their Affiliates
in connection with the selection, evaluation, acquisition, origination, financing, making or development of any Real Estate Assets,
whether or not acquired, including, without limitation, legal fees and expenses, travel and communications expenses, brokerage
fees, costs of appraisals, nonrefundable option payments on property not acquired, accounting fees and expenses, title insurance
premiums and the costs of performing due diligence.

 

“Agreement”
means this Amended and Restated Management Agreement, as amended, supplemented or otherwise modified from time to time.

 

“Automatic
Renewal Term” has the meaning set forth in Section 10(a) hereof.

 

“Bankruptcy”
means, with respect to any Person, (a) the filing by such Person of a voluntary petition seeking liquidation, reorganization, arrangement
or readjustment, in any form, of its debts under Title 11 of the United States Code or any other U.S. federal or state or foreign
insolvency law, or such Person’s filing an answer consenting to or acquiescing in any such petition, (b) the making by such
Person of any assignment for the benefit of its creditors, (c) the expiration of 60 days after the filing of an involuntary petition
under Title 11 of the United States Code, an application for the appointment of a receiver for a material portion of the assets
of such Person, or an involuntary petition seeking liquidation, reorganization, arrangement or readjustment of its debts under
any other U.S. federal or state or foreign insolvency law, provided that the same shall not have been vacated, set aside
or stayed within such 60-day period or (d) the entry against such Person of a final and non-appealable order for relief under any
bankruptcy, insolvency or similar law now or hereinafter in effect.

 

“Base Management
Fee” means the fee payable to the Manager pursuant to Section 6(c).

 

“Board”
means the board of directors of the Company.

 

“Board Investment
Committee” means a committee consisting solely of members of the Board formed for the primary purpose of (1) periodically
reviewing the Company’s investments and (2) pursuant to the Investment Guidelines, approving certain investments proposed
to be made by the Company.

 

“Business
Day” means any day except a Saturday, a Sunday or a day on which banking institutions in New York, New York are not required
to be open.

 

“Claim”
has the meaning set forth in Section 8(c) hereof.

 

“Closing Date”
means the date of closing of the Initial Public Offering.

 

“Code”
has the meaning set forth in the Recitals.

 

“Common Stock”
means the common stock, par value $0.01, of the Company.

 

“Company”
has the meaning set forth in the Preamble.

 

“Company Indemnified
Party” has meaning set forth in Section 8(b) hereof.

 

“Conduct Policies”
has the meaning set forth in Section 2(l) hereof.

 

    	2

    	 

    
 

“Confidential
Information” has the meaning set forth in Section 5(a) hereof.

 

“Core Earnings”
means the net income (loss), computed in accordance with GAAP, excluding (i) non-cash equity compensation expense, (ii) the Incentive
Compensation, (iii) acquisition fees, (iv) financing fees, (v) depreciation and amortization, (vi) any unrealized gains or
losses or other non-cash items that are included in net income for the applicable reporting period, regardless of whether such
items are included in other comprehensive income or loss, or in net income, and (vii) one-time events pursuant to changes in GAAP
and certain non-cash charges, in each case after discussions between the Manager and the Independent Directors and approved by
a majority of the Independent Directors.

 

“Effective
Termination Date” means the last day of the Initial Term or an Automatic Renewal Term, as the case may be, on which this
Agreement is terminated.

 

“Equity Incentive
Plans” means the equity incentive plans adopted by the Company to provide incentive compensation to attract and retain
qualified directors, officers, advisors, consultants and other personnel, including the Manager and Affiliates and personnel of
the Manager and its Affiliates, and any joint venture affiliates of the Company.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

“GAAP”
means generally accepted accounting principles in effect in the United States on the date such principles are applied.

 

“Governing
Instruments” means, with regard to any entity, the articles of incorporation or certificate of incorporation and bylaws
in the case of a corporation, the partnership agreement in the case of a general or limited partnership, the certificate of formation
and operating agreement or limited liability company agreement in the case of a limited liability company, the declaration of trust
or other comparable trust instrument in the case of a trust, or similar governing documents, in each case as the same may be amended
from time to time.

 

“Incentive
Compensation” means the incentive management fee calculated and payable with respect to each calendar quarter (or part
thereof that this Agreement is in effect) in arrears in an amount, not less than zero, equal to the difference between (1) the
product of (a) 20% and (b) the difference between (i) Core Earnings of the Company for the previous 12- month period, and
(ii) the product of (A) the weighted average of the issue price per share of the Common Stock of all of the Company’s public
offerings of Common Stock multiplied by the weighted average number of shares of Common Stock outstanding (including, for the avoidance
of doubt, any restricted shares of Common Stock and any shares of Common Stock underlying other awards granted under one or more
of the Company’s Equity Incentive Plans) in the previous 12-month period, and (B) 8%, and (2) the sum of any Incentive Compensation
paid to the Manager with respect to the first three calendar quarters of such previous 12-month period; provided, however, that
no Incentive Compensation shall be payable with respect to any calendar quarter unless Core Earnings for the 12 most recently completed
calendar quarters is greater than zero.

 

For purposes of calculating
the Incentive Compensation prior to the completion of a 12-month period during the term of this Agreement, Core Earnings shall
be calculated on the basis of the number of days that this Agreement has been in effect on an annualized basis.

 

If the Effective Termination
Date does not correspond to the end of a calendar quarter, the Manager’s Incentive Compensation shall be calculated for the
period beginning on the day after the end of the calendar quarter immediately preceding the Effective Termination Date and ending
on the Effective Termination Date, which Incentive Compensation shall be calculated using Core Earnings for the 12-month period
ending on the Effective Termination Date.

 

    	3

    	 

    
 

“Indemnified
Party” has the meaning set forth in Section 8(b) hereof.

 

“Independent
Director” means a member of the Board who is “independent” in accordance with the Company’s Governing
Instruments and the rules of NASDAQ or such other securities exchange on which the shares of Common Stock are listed.

 

“Initial Public
Offering” means the Company’s sale of Common Stock to the public through dealer managers pursuant to the Registration
Statement.

 

“Initial Term”
has the meaning set forth in Section 10(a) hereof.

 

“Investment
Company Act” means the Investment Company Act of 1940, as amended.

 

“Investment
Guidelines” means the investment guidelines approved by the Board, a copy of which is attached hereto as Exhibit A,
as the same may amended, restated, modified, supplemented or waived pursuant to the approval of a majority of the entire Board
(which must include a majority of the Independent Directors) and the Manager Investment Committee.

 

“Joint Ventures”
means the joint venture or partnership or other similar arrangements (other than between or among the Company and its Subsidiary
or between or among two or more of the Company’s Subsidiaries) in which the Company or its Subsidiary is a co-venturer, member,
partner or other equity holder, which are established to own investments.

 

“Last Appraiser”
has the meaning set forth in Section 6(g) hereof.

 

“Losses”
has the meaning set forth in Section 8(a) hereof.

 

“Manager”
has the meaning set forth in the Preamble and shall include any successor in interest thereto.

 

“Manager Change
of Control” means a change in the direct or indirect (i) beneficial ownership of more than fifty percent (50%) of the
combined voting power of the Manager’s then outstanding equity interests, or (ii) power to direct or control the management
policies of the Manager, whether through the ownership of beneficial equity interests, common directors or officers, by contract
or otherwise. Manager Change of Control shall not include (i) public offerings of the equity interests of the Manager, or (ii)
any assignment of this Agreement by the Manager as permitted hereby and in accordance with the terms hereof.

 

“Manager Indemnified
Party” has the meaning set forth in Section 8(a) hereof.

 

“Manager Investment
Committee” means the investment committee formed by the Manager, the members of which shall consist of employees of the
Manager and its Affiliates and may change from time to time.

 

“Manager Permitted
Disclosure Parties” has the meaning set forth in Section 5(a) hereof.

 

“NASDAQ”
means The Nasdaq Capital Market.

 

    	4

    	 

    
 

“Notice of
Proposal to Negotiate” has the meaning set forth in Section 10(c) hereof.

 

“Person”
means any natural person, corporation, partnership, association, limited liability company, estate, trust, joint venture, any federal,
state, county or municipal government or any bureau, department or agency thereof or any other legal entity and any fiduciary acting
in such capacity on behalf of the foregoing.

 

“Real Estate
Asset” means real property owned from time to time by the Company or any of its Subsidiaries, directly, through one or
more subsidiaries or through a Joint Venture, which consists of (i) land only, (ii) land, including the buildings located
thereon, (iii) buildings only, or (iv) such investments the Board or the Manager designates as Real Estate Asset to the
extent such investments could be classified as Real Estate Asset.

 

“Registration
Statement” means the Company’s Registration Statement on Form S-11 (No. 333-172205), as amended from time to time,
pursuant to which the Company is conducting or has conducted the Initial Public Offering.

 

“Regulation
FD” means Regulation FD as promulgated by the SEC.

 

“REIT”
means a “real estate investment trust” as defined under the Code.

 

“SEC”
means the United States Securities and Exchange Commission.

 

“Securities
Act” means the Securities Act of 1933, as amended.

 

“Subsidiary”
means (i) any subsidiary of the Company, (ii) any partnership the general partner of which is the Company or any subsidiary of
the Company, and (iii) any limited liability company the managing member of which is the Company or any subsidiary of the Company.

 

“Target Assets”
means the types of assets described under “Business— Overview” in the prospectus included in the Registration
Statement, subject to, and including any changes to the Company’s Investment Guidelines that may be approved by the Manager
and the Company from time to time.

 

“Termination
Notice” has the meaning set forth in Section 10(b) hereof.

 

“Termination
Without Cause” has the meaning set forth in Section 10(b) hereof.

 

“Valuation
Notice” has the meaning set forth in Section 6(g) hereof.

 

(b)As used
herein, accounting terms relating to the Company and its Subsidiaries, if any, not defined in Section 1(a) and accounting
terms partly defined in Section 1(a), to the extent not defined, shall have the respective meanings given to them under
GAAP. As used herein, “calendar quarters” shall mean the periods from January 1 to March 31, April 1 to June 30, July 1 to
September 30 and October 1 to December 31 of the applicable year.

 

(c)The words
“hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section references are to this
Agreement unless otherwise specified.

 

    	5

    	 

    
 

(d)The meanings
given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms. The words include,
includes and including shall be deemed to be followed by the phrase “without limitation.”

 

Section 2. Appointment and Duties
of the Manager.

 

(a)The Company
hereby appoints the Manager to manage the investments and day-to-day operations of the Company and its Subsidiaries, subject at
all times to the further terms and conditions set forth in this Agreement and to the supervision of, and such further limitations
or parameters as may be imposed from time to time by, the Board. The Manager hereby agrees to use its commercially reasonable efforts
to perform each of the duties set forth herein, provided that funds are made available by the Company for such purposes as set
forth in Section 7 hereof. The appointment of the Manager shall be exclusive to the Manager, except to the extent that the
Manager elects, in its sole and absolute discretion, subject to the terms of this Agreement, to cause the duties of the Manager
as set forth herein to be provided by third parties.

 

(b)The Manager,
in its capacity as manager of the investments and the day-to-day operations of the Company and its Subsidiaries, at all times will
be subject to the supervision and direction of the Board, will act in a manner that is compliant with the provisions of the Governing
Instruments of the Company and each of its Subsidiaries and will have only such functions and authority as the Board may delegate
to it, including, without limitation, managing the Company’s business affairs in conformity with the Investment Guidelines
and other policies that are approved and adopted by the Board. The Company and the Manager hereby acknowledge the recommendation
by the Manager and the approval by the Board, of the Investment Guidelines, including, but not limited to the Company’s investment
strategy with respect to the Target Assets. The Company and the Manager hereby acknowledge and agree that, during the term of this
Agreement, any proposed changes to the Company’s investment strategy that would modify or expand the Target Assets may only
be recommended by the Manager and shall require the approval of the Board and the Manager.

 

(c)The Manager
will be responsible for the day-to-day operations of the Company (which, for purposes of the Manager’s responsibilities in
this Agreement, includes its Subsidiaries) and will perform (or cause to be performed) such services and activities relating to
the investments and operations of the Company as may be appropriate, which may include, without limitation:

 

(i)forming
the Manager Investment Committee, which will have the following responsibilities: (A) proposing modifications to the Investment
Guidelines to the Board, (B) reviewing the Company’s investment portfolio for compliance with the Investment Guidelines on
a quarterly basis, (C) reviewing the diversification of the Company’s investment portfolio and the Company’s hedging
and financing strategies on a quarterly basis, and (D) conducting or overseeing the provision of the services set forth in this
Section 2;

 

(ii)serving
as the Company’s consultant with respect to the periodic review of the Investment Guidelines and other parameters for the
Company’s investments, financing activities and operations, any modification to which will be approved by a majority of our
independent directors;

 

(iii)investigating,
analyzing and selecting possible investment opportunities and acquiring, financing, retaining, selling, restructuring or disposing
of investments consistent with the Investment Guidelines;

 

    	6

    	 

    
 

(iv)with
respect to prospective purchases, sales or exchanges of investments, conducting negotiations on the Company’s behalf with
sellers, purchasers and brokers and, if applicable, their respective agents and representatives;

 

(v)with
respect to prospective lease transactions, conducting negotiations on the Company’s behalf with current and prospective tenants;

 

(vi)analyzing
prospective opportunities to reposition properties for alternative uses or make capital improvements or in order to retain existing
tenants or attract new tenants at the Real Estate Assets;

 

(vii)serving
as the Company’s consultant with respect to decisions regarding any of its financings or borrowings undertaken by it, including
(1) sourcing financing alternatives, (2) assisting it in developing criteria for debt and equity financing that is specifically
tailored to its investment objectives, and (3) advising it with respect to obtaining appropriate financing for the Real Estate
Assets;

 

(viii)engaging
and supervising, on the Company’s behalf and at the Company’s expense, independent contractors that provide investment
banking, securities brokerage, mortgage brokerage, other financial services, due diligence services, underwriting review services,
legal and accounting services, and all other services (including transfer agent and registrar services) as may be required relating
to the Company’s operations or investments (or potential investments);

 

(ix)coordinating
and managing operations of any Joint Venture or co-investment interests held by the Company and conducting all matters with the
Joint Venture or co-investment partners;

 

(x)providing
executive and administrative personnel, office space and office services required in rendering services to the Company;

 

(xi)administering
the day-to-day operations and performing and supervising the performance of such other administrative functions necessary to the
Company’s management as may be agreed upon by the Manager and the Board, including, without limitation, the collection of
revenues and the payment of the Company’s debts and obligations and maintenance of appropriate computer services to perform
such administrative functions;

 

(xii)communicating
on the Company’s behalf with the holders of any of the Company’s equity or debt securities as required to satisfy the
reporting and other requirements of any governmental bodies or agencies or trading markets and to maintain effective relations
with such holders;

 

(xiii)counseling
the Company in connection with policy decisions to be made by our the Board;

 

(xiv)counseling
the Company regarding the maintenance of the Company’s qualification as a REIT and monitoring compliance with the various
REIT qualification tests and other rules set out in the Code and Treasury Regulations thereunder and using commercially reasonable
efforts to cause the Company to qualify for taxation as a REIT;

 

(xv)furnishing
reports and statistical and economic research to the Company regarding the Company’s activities and services performed for
the Company by the Manager;

 

    	7

    	 

    
 

(xvi)monitoring
the operating performance of the Company’s investments and providing periodic reports with respect thereto to the Board,
including comparative information with respect to such operating performance and budgeted or projected operating results;

 

(xvii)investing
and reinvesting any moneys and securities of the Company (including investing in short-term investments pending investment in other
investments, payment of fees, costs and expenses, or payments of dividends or distributions to the Company’s stockholders
and partners) and advising the Company as to the Company’s capital structure and capital raising;

 

(xviii)causing
the Company to retain qualified accountants and legal counsel, as applicable, to assist in developing appropriate accounting procedures
and systems, internal controls and other compliance procedures and testing systems with respect to financial reporting obligations
and compliance with the provisions of the Code applicable to REITs and, if applicable, taxable REIT subsidiaries, and to conduct
quarterly compliance reviews with respect thereto;

 

(xix)assisting
the Company in qualifying to do business in all applicable jurisdictions and to obtain and maintain all appropriate licenses;

 

(xx)assisting
the Company in complying with all regulatory requirements applicable to the Company in respect of the Company’s business
activities, including preparing or causing to be prepared all financial statements required under applicable regulations and contractual
undertakings and all reports and documents, if any, required under the Exchange Act or the Securities Act, or by NASDAQ;

 

(xxi)assisting
the Company in taking all necessary action to enable the Company to make required tax filings and reports, including soliciting
stockholders for required information to the extent required by the provisions of the Code applicable to REITs;

 

(xxii)handling
and resolving all claims, disputes or controversies (including all litigation, arbitration, settlement or other proceedings or
negotiations) in which the Company may be involved or to which the Company may be subject arising out of the Company’s day-to-day
operations (other than with the Manager or its Affiliates), subject to such limitations or parameters as may be imposed from time
to time by the Board;

 

(xxiii)using
commercially reasonable efforts to cause expenses incurred by the Company or on the Company’s behalf to be commercially reasonable
or commercially customary and within any budgeted parameters or expense guidelines set by the Board from time to time;

 

(xxiv)advising
the Company with respect to and structuring long-term financing vehicles for the Company’s portfolio of Real Estate Assets,
and offering and selling securities publicly or privately in connection with any such structured financing;

 

(xxv)providing
the Company with portfolio management;

 

(xxvi)arranging
marketing materials, advertising, industry group activities (such as conference participations and industry organization memberships)
and other promotional efforts designed to promote the Company’s business;

 

(xxvii)performing
such other services as may be required from time to time for management and other activities relating to the Company’s properties
and business, as the Board shall reasonably request or the Manager shall deem appropriate under the particular circumstances; and

 

(xxviii)using
commercially reasonable efforts to cause the Company to comply with all applicable laws.

 

    	8

    	 

    
 

(d)The Manager
may retain, for and on behalf, and at the sole cost and expense, of the Company, such services of the Persons referred to in Section
7(b) hereof as the Manager deems necessary or advisable in connection with the management and operations of the Company. In
performing its duties under this Section 2, the Manager shall be entitled to rely reasonably on qualified experts and professionals
(including, without limitation, accountants, legal counsel and other professional service providers) hired by the Manager at the
Company’s sole cost and expense.

 

(e)The Manager
shall refrain from any action that, in its sole judgment made in good faith, (i) is not in compliance with the Investment Guidelines,
(ii) would adversely and materially affect the qualification of the Company as a REIT under the Code or the Company’s status
as an entity excluded from investment company status under the Investment Company Act, or (iii) would violate any law, rule
or regulation of any governmental body or agency having jurisdiction over the Company or of any exchange on which the securities
of the Company may be listed or that would otherwise not be permitted by the applicable Governing Instruments. If the Manager is
ordered to take any action by the Board, the Manager shall promptly notify the Board if it is the Manager’s judgment that
such action would adversely and materially affect such status or violate any such law, rule or regulation or Governing Instruments.
Notwithstanding the foregoing, neither the Manager nor any of its Affiliates shall be liable to the Company, the Board, or the
Company’s stockholders for any act or omission by the Manager or any of its Affiliates, except as provided in Section
8 of this Agreement.

 

(f)The Company
(including the Board) agrees to take all actions reasonably required to permit and enable the Manager to carry out its duties and
obligations under this Agreement, including, without limitation, all steps reasonably necessary to allow the Manager to file any
registration statement or other filing required to be made under the Securities Act, Exchange Act, NASDAQ’s Rules Manual,
the Code or other applicable law, rule or regulation on behalf of the Company in a timely manner. The Company further agrees to
use commercially reasonable efforts to make available to the Manager all resources, information and materials reasonably requested
by the Manager to enable the Manager to satisfy its obligations hereunder, including its obligations to deliver financial statements
and any other information or reports with respect to the Company.

 

(g)As frequently
as the Manager may deem reasonably necessary or advisable, or at the direction of the Board, the Manager shall prepare, or, at
the sole cost and expense of the Company, cause to be prepared, with respect to any reports and other information relating to any
proposed or consummated investment as may be reasonably requested by the Company.

 

(i)The
Manager shall prepare, or, at the sole cost and expense of the Company, cause to be prepared, all reports, financial or otherwise,
with respect to the Company reasonably required by the Board in order for the Company to comply with its Governing Instruments,
or any other materials required to be filed with any governmental body or agency, and shall prepare, or, at the sole cost and expense
of the Company, cause to be prepared, all materials and data necessary to complete such reports and other materials, including,
without limitation, an annual audit of the Company’s books of account by a nationally recognized independent accounting firm.

 

    	9

    	 

    
 

(ii)The
Manager shall prepare, or, at the sole cost and expense to the Company, cause to be prepared, regular reports for the Board to
enable the Board to review the Company’s acquisitions, portfolio composition and characteristics, credit quality, performance
and compliance with the Investment Guidelines and policies approved by the Board.

 

(h)Officers,
employees and agents of the Manager and its Affiliates may serve as directors, officers, agents, nominees or signatories for the
Company or any of its Subsidiaries, to the extent permitted by their respective Governing Instruments, by any resolutions duly
adopted by the Board. When executing documents or otherwise acting in such capacities for the Company or any of its Subsidiaries,
such Persons shall indicate in what capacity they are executing on behalf of the Company or any of its Subsidiaries. Without limiting
the foregoing, while this Agreement is in effect, the Manager will provide the Company with a management team, including a Chief
Executive Officer and President or similar positions, along with appropriate support personnel, to provide the management services
to be provided by the Manager to the Company hereunder, who shall devote such of their time to the management of the Company as
necessary and appropriate, commensurate with the level of activity of the Company from time to time.

 

(i)The Manager,
at its sole cost and expense, shall provide personnel for service on the Manager Investment Committee.

 

(j)The Manager,
at its sole cost and expense, shall maintain reasonable and customary “errors and omissions” insurance coverage and
other customary insurance coverage in respect to its obligations and activities under, or pursuant to, this Agreement, naming the
Company as an additional insured.

 

(k)The Manager,
at its sole cost and expense, shall provide such internal audit, compliance and control services as may be required for the Company
to comply with applicable law (including the Securities Act and Exchange Act), regulation (including SEC regulations) and the rules
and requirements of NASDAQ and as otherwise reasonably requested by the Company or its Board from time to time.

 

(l)The Manager
acknowledges receipt of the Company’s Code of Business Conduct and Ethics (the “Conduct Policies”) and
agrees to require the persons who provide services to the Company to comply with such Conduct Policies in the performance of such
services hereunder or such comparable policies as shall in substance hold such persons to at least the standards of conduct set
forth in the Conduct Policies.

 

(m)The Manager,
at its sole cost and expense, shall maintain any required registration of the Manager or any Affiliate with the SEC under the Investment
Advisers Act of 1940, as amended, or with any state securities authority in any state in which the Manager or its Affiliate is
required to be registered as an investment advisor under applicable state securities laws.

 

Section 3. Additional
Activities of the Manager; Non-Solicitation; Restrictions.

 

(a)Except
as provided in Section 3(b) and/or the Investment Guidelines, nothing in this Agreement shall (i) prevent the Manager
or any of its Affiliates or any of their respective officers, directors or employees, from engaging in other businesses or from
rendering services of any kind to any other Person, whether or not the investment objectives or policies of any such other Person
are similar to those of the Company or (ii) in any way bind or restrict the Manager or any of its Affiliates or any of their respective
officers, directors or employees from buying, selling or trading any securities or commodities for their own accounts or for the
account of others for whom the Manager or any of its Affiliates, officers, directors or employees may be acting.

 

    	10

    	 

    

 

(b)While
information and recommendations supplied to the Company shall, in the Manager’s reasonable and good faith judgment, be appropriate
under the circumstances and in light of the investment objectives and policies of the Company, they may be different from the information
and recommendations supplied by the Manager or any Affiliate of the Manager to others. The Company shall be entitled to equitable
treatment under the circumstances in receiving information, recommendations and any other services, but the Company recognizes
that it is not entitled to receive preferential treatment as compared with the treatment given by the Manager or any Affiliate
of the Manager to others. The Company shall have the benefit of the Manager’s best judgment and effort in rendering services
hereunder and, in furtherance of the foregoing, the Manager shall not undertake activities that, in its good faith judgment, will
adversely affect the performance of its obligations under this Agreement.

 

(c)In the
event of a Termination Without Cause of this Agreement by the Company pursuant to Section 10(b) hereof, for a period of
two (2) years from and after the date of such termination of this Agreement, the Company shall not (and shall cause each of its
Subsidiaries to not), without the consent of the Manager, employ or otherwise retain (directly or indirectly by any of the Company’s
Subsidiaries) any employee of the Manager or any of its Affiliates on the date of such termination or any Person who shall have
been employed by the Manager or any of its Affiliates at any time within the two (2) year period immediately preceding the date
on which such Person commences employment with or is otherwise retained by the Company or its Subsidiary. The Company acknowledges
and agrees that, in addition to any damages, the Manager shall be entitled to equitable relief for any violation of this Section
3(c) by the Company or its Subsidiaries, including, without limitation, injunctive relief.

 

Section 4.
Bank Accounts. At the direction of the Board, the Manager may establish and maintain one or more bank accounts in the name
of the Company or any Subsidiary, and may collect and deposit into any such account or accounts, and disburse funds from any such
account or accounts, under such policies, terms and conditions as the Company may establish and the Board may approve. The Manager
shall from time to time render appropriate accountings of such collections and payments to the Board and, upon request, shall provide
information regarding such accountings to the auditors of the Company or any Subsidiary.

 

Section 5.
Records; Confidentiality.

 

(a)The Manager
shall maintain appropriate books of accounts and records relating to services performed hereunder, and such books of account and
records shall be accessible for inspection by representatives of the Company or any Subsidiary at any time during normal business
hours. The Manager shall keep confidential any and all non-public information, written or oral, obtained by it in connection with
the services rendered hereunder (“Confidential Information”) and shall not use Confidential Information except
in furtherance of its duties under this Agreement or disclose Confidential Information, in whole or in part, to any Person other
than (i) to its Affiliates, officers, directors, employees, agents, representatives or advisors who need to know such Confidential
Information for the purpose of rendering services hereunder, (ii) to appraisers, financing sources and others in the ordinary
course of the Company’s business ((i) and (ii) collectively, “Manager Permitted Disclosure Parties”),
(iii) in connection with any governmental or regulatory filings of the Company, or filings with NASDAQ or other applicable securities
exchanges or markets, or disclosure or presentations to Company investors (subject to compliance with Regulation FD), (iv) to governmental
officials having jurisdiction over the Company, (v) as requested by law or legal process to which the Manager or any Person to
whom disclosure is permitted hereunder is a party, or (vi) with the consent of the Company. The Manager agrees to inform each of
its Manager Permitted Disclosure Parties of the non-public nature of the Confidential Information and to obtain agreement from
such Persons to treat such Confidential Information in accordance with the terms hereof.

 

    	11

    	 

    
 

(b)Nothing
herein shall prevent any Manager Permitted Disclosure Party from disclosing Confidential Information (i) upon the order of any
court or administrative agency, (ii) upon the request or demand of, or pursuant to any law or regulation to, any regulatory agency
or authority, (iii) to the extent reasonably required in connection with the exercise of any remedy hereunder, or (iv) to its legal
counsel or independent auditors; provided, however that with respect to clauses (i) and (ii), it is agreed that,
so long as not legally prohibited, the Manager will provide the Company with prompt written notice of such order, request or demand
so that the Company may seek, at its sole expense, an appropriate protective order and/or waive the Manager Permitted Disclosure
Party compliance with the provisions of this Agreement. If, failing the entry of a protective order or the receipt of a waiver
hereunder, the Manager Permitted Disclosure Party is required to disclose Confidential Information, the Manager Permitted Disclosure
Party may disclose only that portion of such information that is legally required without liability hereunder; provided,
that the Manager Permitted Disclosure Party agrees to exercise its commercially reasonable efforts to obtain reliable assurance
that confidential treatment will be accorded such information.

 

(c)Notwithstanding
anything herein to the contrary, each of the following shall be deemed to be excluded from provisions hereof: any Confidential
Information that (A) is available to the public from a source other than the Manager, (B) is released in writing by the Company
to the public (except to the extent exempt under Regulation FD) or to persons who are not under similar obligation of confidentiality
to the Company, or (C) is obtained by the Manager from a third-party which, to the best of the Manager’s knowledge,
does not constitute a breach by such third-party of an obligation of confidence with respect to the Confidential Information disclosed.
The provisions of this Agreement shall survive the expiration or earlier termination of this Agreement for a period of one year.

 

Section 6.
Compensation.

 

(a)For the
services rendered under this Agreement, the Company shall pay the Base Management Fee and the Incentive Compensation to the Manager.
The Manager will not receive any compensation for the period prior to the Closing Date other than expenses incurred and reimbursed
pursuant to Section 7 hereof.

 

(b)The parties
acknowledge that the Base Management Fee is intended to compensate the Manager for certain expenses not otherwise reimbursable
under Section 7 below in order for the Manager to provide the Company the investment advisory services and general management
services rendered under this Agreement.

 

(c)The Company
shall pay a monthly Base Management Fee to the Manager or its permitted assignees as compensation for services rendered in connection
with this Agreement.  The Base Management Fee shall be payable monthly, in advance, in cash or shares of Common Stock, at
the option of the Manager, in an amount calculated as follows: (i) with respect to all Real Estate Assets held by the Company with
an average unadjusted book value (before reduction for depreciation, amortization, impairment charges and cumulative acquisition
costs charged to expense in accordance with GAAP) up to and including $3.0 billion, one-twelfth of 0.50% of the average unadjusted
book value of the Real Estate Assets held as of the last day of the immediately preceding month before reduction for depreciation,
amortization, impairment charges and cumulative acquisition costs charged to expense in accordance with GAAP and (ii) with respect
to all Real Estate Assets held by the Company with an average unadjusted book value (before reduction for depreciation, amortization,
impairment charges and cumulative acquisition costs charged to expense in accordance with GAAP) of more than $3.0 billion, one-twelfth
of 0.40% of the average unadjusted book value of the Real Estate Assets held as of the last day of the immediately preceding month
before reduction for depreciation, amortization, impairment charges and cumulative acquisition costs charged to expense in accordance
with GAAP.  The Base Management Fee will be pro rated for any partial month. The Manager shall calculate each monthly installment
of the Base Management Fee, and deliver such calculation to the Company, within ten (10) days following the last day of each calendar
month for which a Base Management Fee is payable. The Company shall pay the Manager each installment of the Base Management Fee
within five (5) Business Days after the date of delivery to the Company of such computations.

 

    	12

    	 

    
 

(d)The Incentive
Compensation shall be payable in arrears, in quarterly installments commencing with the quarter in which this Agreement is executed.
The Manager shall compute each quarterly installment of the Incentive Compensation within forty-five (45) days after the end of
the calendar quarter with respect to which such installment is payable. A copy of the computations made by the Manager to calculate
such installment shall thereafter promptly be delivered to the Board and, upon such delivery, payment of such installment of the
Incentive Compensation shown therein shall be due and payable no later than the date which is five (5) Business Days after the
date of delivery to the Board of such computations.

 

(e)Each
installment of the Incentive Compensation shall be payable as follows:

 

(i)fifty
percent (50%) of the Incentive Compensation will be payable in shares of Common Stock; provided, however, the percentage
of the Incentive Compensation payable in shares of Common Stock is subject to the following: (1) the ownership of such shares by
the Manager does not violate the limit on ownership of Common Stock set forth in the Company’s Governing Instruments, after
giving effect to any waiver from such limit that the Board may grant to the Manager in the future and (2) the Company’s
issuance of such shares to the Manager complies with all applicable restrictions under U.S. federal securities laws and the rules
of NASDAQ; and

 

(ii)the
remainder will be payable in cash.

 

(f)The number
of shares of Common Stock payable as the Incentive Compensation to be issued to the Manager will be equal to the dollar amount
of the portion of the quarterly installment of the Incentive Compensation payable in shares of Common Stock divided by a value
determined as follows:

 

(i)if
the Common Stock is traded on a securities exchange, the value shall be deemed to be the average of the closing prices of the Common
Stock on such exchange on the five (5) Business Days prior to the date on which the quarterly installment of the Incentive Compensation
is paid;

 

(ii)if
the Common Stock is not traded on a securities exchange but is actively traded over-the-counter, the value shall be deemed to be
the average of the closing bids or sales prices, as applicable, on the five (5) Business Days prior to the date on which the quarterly
installment of the Incentive Compensation is paid; and

 

(iii)if
the Common Stock is neither traded on a securities exchange nor actively traded over-the-counter, the value shall be the fair market
value thereof, as reasonably determined in good faith by the Board (including a majority of the Independent Directors) of the Company.

 

(g)If at
any time the Manager shall, in connection with a determination of the value of the Common Stock made by the Board pursuant to Section
6(f)(iii) hereof, (i) dispute such determination in good faith by more than five percent (5%), and (ii) such dispute cannot
be resolved between the Independent Directors and the Manager within ten (10) Business Days after the Manager provides written
notice to the Company of such dispute (the “Valuation Notice”), then the matter shall be resolved by an independent
appraiser of recognized standing selected jointly by the Independent Directors and the Manager within not more than twenty (20)
days after the Valuation Notice. In the event the Independent Directors and the Manager cannot agree with respect to such selection
within the aforesaid twenty (20) day time-frame, the Independent Directors shall select one such independent appraiser and the
Manager shall select one independent appraiser within five (5) Business Days after the expiration of the twenty (20) day period,
with one additional such appraiser (the “Last Appraiser”) to be selected by the appraisers so designated within
five (5) Business Days after their selection. Any valuation decision made by the Last Appraiser shall be deemed final and binding
upon the Board and the Manager and shall be delivered to the Manager and the Board within not more than fifteen (15) days after
the selection of the Last Appraiser. The expenses of the appraisal shall be paid by the party with the estimate which deviated
the furthest from the final valuation decision made by the independent appraisers.

 

    	13

    	 

    
 

Section 7.
Expenses of the Company.

 

(a)The Manager
shall be responsible for the expenses related to any and all personnel of the Manager and its Affiliates who provide services to
the Company pursuant to this Agreement (including, without limitation, each of the officers of the Company and any directors of
the Company who are also directors, officers, employees or agents of the Manager or any of its Affiliates), including, without
limitation, salaries, bonus and other wages, payroll taxes and the cost of employee benefit plans of such personnel, and costs
of insurance with respect to such personnel.

 

(b)The Company
shall pay all of its costs and expenses and shall reimburse the Manager or its Affiliates for expenses of the Manager and its Affiliates
incurred on behalf of the Company, excepting only those expenses that are specifically the responsibility of the Manager pursuant
to Section 7(a) of this Agreement. Without limiting the generality of the foregoing, it is specifically agreed that the
following costs and expenses of the Company or any Subsidiary shall be paid by the Company and shall not be paid by the Manager
or Affiliates of the Manager:

 

(i)Acquisition
Expenses; provided, however, that Acquisition Expenses paid pursuant to this Agreement shall be without duplication
with any “Acquisition Expenses” paid pursuant to that certain Acquisition and Capital Services Agreement, dated as
of September 6, 2011, by and between the Company and AR Capital, LLC (formerly known as American Realty Capital II, LLC);

 

(ii)expenses
in connection with the issuance of securities of the Company and transaction costs incident to the acquisition, disposition and
financing of the investments of the Company and its Subsidiaries;

 

(iii)costs
of legal, tax, accounting, consulting, auditing and other similar services rendered for the Company by providers retained by the
Manager or, if provided by the Manager’s personnel, in amounts which are no greater than those which would be payable to
outside professionals or consultants engaged to perform such services pursuant to agreements negotiated on an arm’s-length
basis;

 

(iv)the
compensation and expenses of the Company’s directors and the cost of liability insurance to indemnify the Company’s
directors and officers;

 

(v)costs
associated with the establishment and maintenance of any of the Company’s credit facilities, other financing arrangements,
or other indebtedness of the Company (including commitment fees, accounting fees, legal fees, closing and other similar costs)
or any of the Company’s securities offerings;

 

    	14

    	 

    
 

(vi)expenses
connected with communications to holders of the Company’s securities or of the Subsidiaries and other bookkeeping and clerical
work necessary in maintaining relations with holders of such securities and in complying with the continuous reporting and other
requirements of governmental bodies or agencies, including, without limitation, all costs of preparing and filing required reports
with the SEC, the costs payable by the Company to any transfer agent and registrar in connection with the listing and/or trading
of the Company’s securities on any exchange, the fees payable by the Company to any such exchange in connection with its
listing, costs of preparing, printing and mailing the Company’s annual report to the Company’s stockholders and proxy
materials with respect to any meeting of the Company’s stockholders;

 

(vii)costs
associated with any computer software or hardware, electronic equipment or purchased information technology services from third-party
vendors that is used for the Company;

 

(viii)expenses
incurred by managers, officers, personnel and agents of the Manager for travel on the Company’s behalf and other out-of-pocket
expenses incurred by managers, officers, personnel and agents of the Manager in connection with the purchase, financing, refinancing,
sale or other disposition of an investment or establishment and maintenance of any of the Company’s securitizations or any
of the Company’s securities offerings;

 

(ix)costs
and expenses incurred with respect to market information systems and publications, research publications and materials, and settlement,
clearing and custodial fees and expenses;

 

(x)compensation
and expenses of the Company’s custodian and transfer agent, if any;

 

(xi)the
costs of maintaining compliance with all federal, state and local rules and regulations or any other regulatory agency;

 

(xii)all
taxes and license fees;

 

(xiii)all
insurance costs incurred in connection with the operation of the Company’s business except for the costs attributable to
the insurance that the Manager elects to carry for itself and its personnel;

 

(xiv)costs
and expenses incurred in contracting with third parties;

 

(xv)all
other costs and expenses relating to the Company’s business and investment operations, including, without limitation, the
costs and expenses of acquiring, owning, protecting, maintaining, developing and disposing of investments, including appraisal,
reporting, audit and legal fees;

 

(xvi)expenses
relating to any office(s) or office facilities, including, but not limited to, disaster backup recovery sites and facilities, maintained
for the Company or the investments of the Company and its Subsidiaries separate from the office or offices of the Manager;

 

(xvii)expenses
connected with the payments of interest, dividends or distributions in cash or any other form authorized or caused to be made by
the Board to or on account of holders of the Company’s securities or of the Subsidiaries, including, without limitation,
in connection with any dividend reinvestment plan;

 

    	15

    	 

    
 

(xviii)any
judgment or settlement of pending or threatened proceedings (whether civil, criminal or otherwise) against the Company or any Subsidiary,
or against any trustee, director, partner, member or officer of the Company or of any Subsidiary in his capacity as such for which
the Company or any Subsidiary is required to indemnify such trustee, director, partner, member or officer by any court or governmental
agency; and

 

(xix)all
other expenses actually incurred by the Manager (except as otherwise specified herein) which are reasonably necessary for the performance
by the Manager of its duties and functions under this Agreement.

 

(c)Costs
and expenses incurred by the Manager on behalf of the Company shall be reimbursed monthly to the Manager. The Manager shall prepare
a written statement in reasonable detail documenting the costs and expenses of the Company and those incurred by the Manager on
behalf of the Company during each month, and shall deliver such written statement to the Company within thirty (30) days after
the end of each month. The Company shall pay all amounts payable to the Manager pursuant to this Section 7(c) within five
(5) Business Days after the receipt of the written statement without demand, deduction, offset or delay. Cost and expense reimbursement
to the Manager shall be subject to adjustment at the end of each calendar year in connection with the annual audit of the Company.
The provisions of this Section 7 shall survive the expiration or earlier termination of this Agreement to the extent such
expenses have previously been incurred or are incurred in connection with such expiration or termination.

 

Section 8.
Limits of the Manager’s Responsibility.

 

(a)The Manager
assumes no responsibility under this Agreement other than to render the services called for hereunder in good faith and shall not
be responsible for any action of the Board in following or declining to follow any advice or recommendations of the Manager, including
as set forth in the Investment Guidelines. The Manager and its Affiliates, and the directors, officers, employees, partners, members,
stockholders, other equity holders, agents and representatives of the Manager and its Affiliates (each, a “Manager Indemnified
Party”), will not be liable to the Company, any Subsidiary, the Board, the Company’s stockholders or any Subsidiary’s
stockholders, partners or members for any acts or omissions by any Manager Indemnified Party performed in accordance with and pursuant
to this Agreement, except by reason of any act or omission constituting bad faith, willful misconduct, gross negligence or reckless
disregard of the duties under this Agreement on the part of such Manager Indemnified Party. The Company shall, to the full extent
lawful, reimburse, indemnify and hold harmless each Manager Indemnified Party, of and from any and all expenses, losses, damages,
liabilities, demands, charges and claims of any nature whatsoever (including reasonable attorneys’ fees) (collectively “Losses”)
in respect of or arising from any acts or omissions of such Manager Indemnified Party performed in good faith under this Agreement
and not constituting bad faith, willful misconduct, gross negligence or reckless disregard of duties on the part of such Manager
Indemnified Party under this Agreement. In addition, (i) the Manager will not be liable for trade errors that may result from ordinary
negligence, including, without limitation, errors in the investment decision making process or in the trade process and (ii) the
Company shall advance funds to a Manager Indemnified Party for legal fees and other costs and expenses incurred as a result of
any claim, suit, action or proceeding for which indemnification is being sought, provided that such Manager Indemnified
Party undertakes to repay the advanced funds to the Company, together with the applicable legal rate of interest thereon, in cases
in which such Manager Indemnified Party is found pursuant to a final and non-appealable order or judgment to not be entitled to
indemnification.

 

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(b)The Manager
shall, to the full extent lawful, reimburse, indemnify and hold harmless the Company, and the directors, officers and stockholders
of the Company and each Person, if any, controlling the Company (each, a “Company Indemnified Party”; a Manager
Indemnified Party and a Company Indemnified Party are each sometimes hereinafter referred to as an “ Indemnified Party”)
of and from any and all Losses in respect of or arising from (i) any acts or omissions of the Manager constituting bad faith, willful
misconduct, gross negligence or reckless disregard of duties of the Manager under this Agreement or (ii) any claims by the Manager’s
employees relating to the terms and conditions of their employment by the Manager.

 

(c)In case
any such claim, suit, action or proceeding (a “Claim”) is brought against any Indemnified Party in respect of
which indemnification may be sought by such Indemnified Party pursuant hereto, the Indemnified Party shall give prompt written
notice thereof to the indemnifying party, which notice shall include all documents and information in the possession of or under
the control of such Indemnified Party reasonably necessary for the evaluation and/or defense of such Claim and shall specifically
state that indemnification for such Claim is being sought under this Section; provided, however, that the failure of the
Indemnified Party to so notify the indemnifying party shall not limit or affect such Indemnified Party’s rights other than
pursuant to this Section. Upon receipt of such notice of Claim (together with such documents and information from such Indemnified
Party), the indemnifying party shall, at its sole cost and expense, in good faith defend any such Claim with counsel reasonably
satisfactory to such Indemnified Party, which counsel may, without limiting the rights of such Indemnified Party pursuant to the
next succeeding sentence of this Section 8(c), also represent the indemnifying party in such investigation, action or proceeding.
In the alternative, such Indemnified Party may elect to conduct the defense of the Claim, if (i) such Indemnified Party reasonably
determines that the conduct of its defense by the indemnifying party could be materially prejudicial to its interests, (ii) the
indemnifying party refuses to assume such defense (or fails to give written notice to the Indemnified Party within ten (10) days
of receipt of a notice of Claim that the indemnifying party assumes such defense), or (iii) the indemnifying party shall have failed,
in such Indemnified Party’s reasonable judgment, to defend the Claim in good faith. The indemnifying party may settle any
Claim against such Indemnified Party without such Indemnified Party’s consent, provided (i) such settlement is without any
Losses whatsoever to such Indemnified Party, (ii) the settlement does not include or require any admission of liability or culpability
by such Indemnified Party and (iii) the indemnifying party obtains an effective written release of liability for such Indemnified
Party from the party to the Claim with whom such settlement is being made, which release must be reasonably acceptable to such
Indemnified Party, and a dismissal with prejudice with respect to all claims made by the party against such Indemnified Party in
connection with such Claim. The applicable Indemnified Party shall reasonably cooperate with the indemnifying party, at the indemnifying
party’s sole cost and expense, in connection with the defense or settlement of any Claim in accordance with the terms hereof.
If such Indemnified Party is entitled pursuant to this Section 8(c) to elect to defend such Claim by counsel of its own
choosing and so elects, then the indemnifying party shall be responsible for any good faith settlement of such Claim entered into
by such Indemnified Party. Except as provided in the immediately preceding sentence, no Indemnified Party may pay or settle any
Claim and seek reimbursement therefor under this Section 8(c).

 

(d)The provisions
of this Section 8 shall survive the expiration or earlier termination of this Agreement.

 

    	17

    	 

    
 

Section 9.
No Joint Venture. The Company and the Manager are not partners or joint venturers with each other and nothing herein shall
be construed to make them such partners or joint venturers or impose any liability as such on either of them.

 

Section 10.
Term; Renewal; Termination Without Cause.

 

(a)This
Agreement shall become effective on the Closing Date and shall continue in operation, unless terminated in accordance with the
terms hereof, until the tenth anniversary of the Closing Date (the “Initial Term”). After the Initial Term,
this Agreement shall be deemed renewed automatically each year for an additional one-year period (an “Automatic Renewal
Term”) unless the Company or the Manager elects not to renew this Agreement in accordance with Section 10(b) or
Section 10(d), respectively.

 

(b)Notwithstanding
any other provision of this Agreement to the contrary, upon written notice provided to the Manager no later than 180 days prior
to the expiration of the Initial Term or any Automatic Renewal Term (the “Termination Notice”), the Company
may, without cause, in connection with the expiration of the Initial Term or the then current Automatic Renewal Term, decline to
renew this Agreement (any such nonrenewal, a “Termination Without Cause”) upon the affirmative vote of at least
two-thirds of the Independent Directors that includes a finding by such two-thirds of the Independent Directors that either (1)
there has been unsatisfactory performance by the Manager that is materially detrimental to the Company and its Subsidiaries taken
as a whole or (2) the Base Management Fee and Incentive Compensation payable to the Manager are not fair, subject to Section
10(c) below. The Company may terminate this Agreement for cause pursuant to Section 12 hereof even after providing
a Termination Notice.

 

(c)Notwithstanding
the provisions of Section 10(b), if the reason for nonrenewal specified in the Termination Notice is that two-thirds of
the Independent Directors have determined that the Base Management Fee or the Incentive Compensation payable to the Manager is
unfair, the Company shall not have the foregoing nonrenewal right in the event the Manager agrees that it will continue to perform
its duties hereunder during the Automatic Renewal Term that would commence upon the expiration of the Initial Term or then current
Automatic Renewal Term at a fee that at least two-thirds of the Independent Directors determine to be fair; provided, however,
the Manager shall have the right to renegotiate the Base Management Fee and/or the Incentive Compensation, by delivering to
the Company, not less than 120 days prior to the pending Effective Termination Date, written notice (a “Notice of Proposal
to Negotiate”) of its intention to renegotiate the Base Management Fee and/or the Incentive Compensation. Thereupon,
the Company and the Manager shall endeavor to negotiate the Base Management Fee and/or the Incentive Compensation in good faith.
Provided that the Company and the Manager agree to a revised Base Management Fee, Incentive Compensation or other compensation
structure within sixty (60) days following the Company’s receipt of the Notice of Proposal to Negotiate, the Termination
Notice from the Company shall be deemed of no force and effect, and this Agreement shall continue in full force and effect on the
terms stated herein, except that the Base Management Fee, the Incentive Compensation or other compensation structure shall be the
revised Base Management Fee, Incentive Compensation or other compensation structure as then agreed upon by the Company and the
Manager. The Company and the Manager agree to execute and deliver an amendment to this Agreement setting forth such revised Base
Management Fee, Incentive Compensation, or other compensation structure promptly upon reaching an agreement regarding same. In
the event that the Company and the Manager are unable to agree to a revised Base Management Fee, Incentive Compensation, or other
compensation structure during such sixty (60) day period, this Agreement shall terminate on the Effective Termination Date.

 

(d)No later
than 180 days prior to the expiration of the Initial Term or the then current Automatic Renewal Term, the Manager may deliver written
notice to the Company informing it of the Manager’s intention to decline to renew this Agreement, whereupon this Agreement
shall not be renewed and extended and this Agreement shall terminate effective on the anniversary date of this Agreement next following
the delivery of such notice.

 

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(e)Except
as set forth in this Section 10, a nonrenewal of this Agreement pursuant to this Section 10 shall be without any
further liability or obligation of either party to the other, except as provided in Section 3(c), Section 5, Section
7, Section 8 and Section 14 of this Agreement.

 

(f)The Manager
shall cooperate with the Company in executing an orderly transition of the management of the Company’s consolidated assets
to a new manager.

 

Section 11.
Assignments.

 

(a)Assignments
by the Manager. This Agreement shall terminate automatically in the event of its assignment, in whole or in part, by the Manager,
unless such assignment is consented to in writing by the Company with the consent of a majority of the Independent Directors. Any
such permitted assignment shall bind the assignee under this Agreement in the same manner as the Manager is bound, and the Manager
shall be liable to the Company for all acts or omissions of the assignee under any such assignment. In addition, the assignee shall
execute and deliver to the Company a counterpart of this Agreement naming such assignee as the Manager. Notwithstanding the foregoing,
the Manager may, without the approval of the Company’s Independent Directors, (i) assign this Agreement to an Affiliate of
the Manager and (ii) delegate to one or more of its Affiliates the performance of any of its responsibilities hereunder so long
as it remains liable for any such Affiliate’s performance, in each case so long as assignment or delegation does not require
the Company’s approval under the Investment Company Act (but if such approval is required, the Company shall not unreasonably
withhold, condition or delay its consent). Nothing contained in this Agreement shall preclude any pledge, hypothecation or other
transfer of any amounts payable to the Manager under this Agreement.

 

(b)Assignments
by the Company. This Agreement shall not be assigned by the Company without the prior written consent of the Manager, except
in the case of assignment by the Company to another REIT or other organization which is a successor (by merger, consolidation,
purchase of assets, or other transaction) to the Company, in which case such successor organization shall be bound under this Agreement
and by the terms of such assignment in the same manner as the Company is bound under this Agreement.

 

Section 12.
Termination for Cause.

 

(a)The Company
may terminate this Agreement effective upon 30 days’ prior written notice of termination from the Company to the Manager
if (i) the Manager, its agents or its assignees breaches any material provision of this Agreement and such breach shall continue
for a period of 30 days after written notice thereof specifying such breach and requesting that the same be remedied in such 30-day
period (or 45 days after written notice of such breach if the Manager takes steps to cure such breach within 30 days of the written
notice), (ii) there is a commencement of any proceeding relating to the Manager’s Bankruptcy or insolvency, including an
order for relief in an involuntary bankruptcy case or the Manager authorizing or filing a voluntary bankruptcy petition, (iii)
any Manager Change of Control which a majority of the Independent Directors determines is materially detrimental to the Company
and its Subsidiaries taken as a whole, (iv) the dissolution of the Manager, or (v) the Manager commits fraud against the Company,
misappropriates or embezzles funds of the Company, or acts, or fails to act, in a manner constituting bad faith, willful misconduct,
gross negligence or reckless disregard in the performance of its duties under this Agreement; provided, however, that if
any of the actions or omissions described in this clause (v) are caused by an employee and/or officer of the Manager or one of
its Affiliates and the Manager takes all necessary and appropriate action against such person and cures the damage caused by such
actions or omissions within 30 days of the Manager’s actual knowledge of its commission or omission, the Company shall not
have the right to terminate this Agreement pursuant to this Section 12(a)(v).

 

    	19

    	 

    
 

(b)The Manager
may terminate this Agreement effective upon 60 days’ prior written notice of termination to the Company in the event that
the Company shall default in the performance or observance of any material term, condition or covenant contained in this Agreement
and such default shall continue for a period of 30 days after written notice thereof specifying such default and requesting that
the same be remedied in such 30-day period.

 

(c)The Manager
may terminate this Agreement if the Company becomes required to register as an investment company under the Investment Company
Act, with such termination deemed to occur immediately before such event.

 

Section 13.
Action Upon Termination. From and after the effective date of termination of this Agreement pursuant to Sections 10,
11, or 12 of this Agreement, the Manager shall not be entitled to compensation for further services hereunder, but
shall be paid all compensation accruing to the date of termination. Upon any such termination, the Manager shall forthwith:

 

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

 

(b)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 with respect to the Company and any Subsidiaries;
and

 

(c)deliver
to the Board all property and documents of the Company and any Subsidiaries then in the custody of the Manager.

 

Section 14.
Release of Money or Other Property Upon Written Request.

 

The Manager agrees
that any money or other property of the Company (which such term, for the purposes of this Section 14, shall be deemed to
include any and all of its Subsidiaries, if any) held by the Manager shall be held by the Manager as custodian for the Company,
and the Manager’s records shall be appropriately and clearly marked to reflect the ownership of such money or other property
by the Company. Upon the receipt by the Manager of a written request signed by a duly authorized officer of the Company requesting
the Manager to release to the Company any money or other property then held by the Manager for the account of the Company under
this Agreement, the Manager shall release such money or other property to the Company within a reasonable period of time, but in
no event later than 60 days following such request. Upon delivery of such money or other property to the Company, the Manager shall
not be liable to the Company, the Board, or the Company’s stockholders or partners for any acts or omissions by the Company
in connection with the money or other property released to the Company in accordance with this Section 14. The Company shall
indemnify the Manager, its directors, officers, stockholders, employees and agents against any and all Losses which arise in connection
with the Manager’s proper release of such money or other property to the Company in accordance with the terms of this Section
14. Indemnification pursuant to this provision shall be in addition to any right of the Manager to indemnification under Section
8 of this Agreement.

 

    	20

    	 

    
 

Section 15.
Representations and Warranties.

 

(a)The Company
hereby represents and warrants to the Manager as follows:

 

(i)The
Company is duly organized, validly existing and in good standing under the laws of the State of Maryland, has the corporate power
and authority and the legal right to own and operate its assets, to lease any property it may operate as lessee and to conduct
the business in which it is now engaged and is duly qualified as a foreign corporation and in good standing under the laws of each
jurisdiction where its ownership or lease of property or the conduct of its business requires such qualification, except for failures
to be so qualified, authorized or licensed that could not in the aggregate have a material adverse effect on the business operations,
assets or financial condition of the Company and its Subsidiaries, if any, taken as a whole.

 

(ii)The
Company has the corporate power and authority and the legal right to make, deliver and perform this Agreement and all obligations
required hereunder and has taken all necessary corporate action to authorize this Agreement on the terms and conditions hereof
and the execution, delivery and performance of this Agreement and all obligations required hereunder. No consent of any other Person,
including stockholders and creditors of the Company, and no license, permit, approval or authorization of, exemption by, notice
or report to, or registration, filing or declaration with, any governmental authority is required by the Company in connection
with this Agreement or the execution, delivery, performance, validity or enforceability of this Agreement and all obligations required
hereunder. This Agreement has been, and each instrument or document required hereunder will be, executed and delivered by a duly
authorized officer of the Company, and this Agreement constitutes, and each instrument or document required hereunder when executed
and delivered hereunder will constitute, the legally valid and binding obligation of the Company enforceable against the Company
in accordance with its terms.

 

(iii)The
execution, delivery and performance of this Agreement and the documents or instruments required hereunder will not violate any
provision of any existing law or regulation binding on the Company, or any order, judgment, award or decree of any court, arbitrator
or governmental authority binding on the Company, or the Governing Instruments of, or any securities issued by, the Company or
of any mortgage, indenture, lease, contract or other agreement, instrument or undertaking to which the Company is a party or by
which the Company or any of its assets may be bound, the violation of which would have a material adverse effect on the business
operations, assets or financial condition of the Company and its Subsidiaries, if any, taken as a whole, and will not result in,
or require, the creation or imposition of any lien or any of its property, assets or revenues pursuant to the provisions of any
such mortgage, indenture, lease, contract or other agreement, instrument or undertaking.

 

(b)The Manager
hereby represents and warrants to the Company as follows:

 

(i)The
Manager is duly organized, validly existing and in good standing under the laws of the State of Delaware, has the limited liability
company power and authority and the legal right to own and operate its assets, to lease the property it operates as lessee and
to conduct the business in which it is now engaged and is duly qualified as a foreign corporation and in good standing under the
laws of each jurisdiction where its ownership or lease of property or the conduct of its business requires such qualification,
except for failures to be so qualified, authorized or licensed that could not in the aggregate have a material adverse effect on
the business operations, assets or financial condition of the Manager.

 

    	21

    	 

    
 

(ii)The
Manager has the limited liability company power and authority and the legal right to make, deliver and perform this Agreement and
all obligations required hereunder and has taken all necessary corporate action to authorize this Agreement on the terms and conditions
hereof and the execution, delivery and performance of this Agreement and all obligations required hereunder. No consent of any
other Person, including members and creditors of the Manager, and no license, permit, approval or authorization of, exemption by,
notice or report to, or registration, filing or declaration with, any governmental authority is required by the Manager in connection
with this Agreement or the execution, delivery, performance, validity or enforceability of this Agreement and all obligations required
hereunder. This Agreement has been, and each instrument or document required hereunder will be, executed and delivered by a duly
authorized officer of the Manager, and this Agreement constitutes, and each instrument or document required hereunder when executed
and delivered hereunder will constitute, the legally valid and binding obligation of the Manager enforceable against the Manager
in accordance with its terms.

 

(iii)The
execution, delivery and performance of this Agreement and the documents or instruments required hereunder will not violate any
provision of any existing law or regulation binding on the Manager, or any order, judgment, award or decree of any court, arbitrator
or governmental authority binding on the Manager, or the Governing Instruments of, or any securities issued by, the Manager or
of any mortgage, indenture, lease, contract or other agreement, instrument or undertaking to which the Manager is a party or by
which the Manager or any of its assets may be bound, the violation of which would have a material adverse effect on the business
operations, assets or financial condition of the Manager, and will not result in, or require, the creation or imposition of any
lien or any of its property, assets or revenues pursuant to the provisions of any such mortgage, indenture, lease, contract or
other agreement, instrument or undertaking.

 

Section 16.
The American Realty Capital Name.

 

The Manager
and its Affiliates have or may have a proprietary interest in the names “American Realty Capital,” “ARC”
and “AR Capital.”  The Manager hereby grants to the Company, to the extent of any proprietary interest the
Manager may have in any of the names “American Realty Capital,” “ARC” and “AR Capital,” a non-transferable,
non-assignable, non-exclusive, royalty-free right and license to use the names “American Realty Capital,” “ARC”
and “AR Capital” during the term of this Agreement. The Company agrees that the Manager and its Affiliates will have
the right to approve of any use by the Company of the names “American Realty Capital,” “ARC” and “AR
Capital,” such approval not to be unreasonably withheld, conditioned or delayed. Accordingly, and in recognition of this
right, if at any time the Company ceases to retain the Manager or one of its Affiliates to perform management services for the
Company, the Company will, promptly after receipt of written request from the Manager, cease to conduct business under or use the
names “American Realty Capital,” “ARC” and “AR Capital” or any derivative thereof and the Company
shall change its name and the names of any of its subsidiaries to a name that does not contain the names “American Realty
Capital,” “ARC” and “AR Capital” or any other word or words that might, in the reasonable discretion
of the Manager, be susceptible of indication of some form of relationship between the Company and the Manager or any its Affiliates.
At such time, the Company will also make any changes to any trademarks, servicemarks or other marks necessary to remove any references
to the words “American Realty Capital,” “ARC” and “AR Capital.” Consistent with the foregoing,
it is specifically recognized that the Manager or one or more of its Affiliates has in the past and may in the future organize,
sponsor or otherwise permit to exist other investment vehicles (including vehicles for investment in real estate) and financial
and service organizations having any of the names “American Realty Capital,” “ARC” and “AR Capital”
as a part of their name, all without the need for any consent (and without the right to object thereto) by the Company.  Neither
the Manager nor any of its Affiliates makes any representation or warranty, express or implied, with respect to the names “American
Realty Capital,” “ARC” and “AR Capital” licensed hereunder or the use thereof (including without
limitation as to whether the use of the names “American Realty Capital,” “ARC” and “AR Capital”
will be free from infringement of the intellectual property rights of third parties.  Notwithstanding the preceding,
the Manager represents and warrants that it is not aware of any pending claims or litigation or of any claims threatened in writing
regarding the use or ownership of the names “American Realty Capital,” “ARC” and “AR Capital.”

 

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Section 17.
Miscellaneous.

 

(a)Notices.
All notices, requests, communications and demands to or upon the respective parties hereto to be effective shall be in writing
(including by facsimile), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when
delivered against receipt or upon actual receipt of (i) personal delivery, (ii) delivery by reputable overnight courier, (iii) delivery
by facsimile transmission with telephonic confirmation or (iv) delivery by registered or certified mail, postage prepaid, return
receipt requested, addressed as set forth below (or to such other address as may be hereafter notified by the respective parties
hereto in accordance with this Section 17):

 

The Company:American Realty
Capital Properties, Inc.

405 Park Avenue 15th Floor

New York, New York 10022

Facsimile No.: (212) 421-5799

Attention: Nicholas S. Schorsch

 

with a copy to:

 

Proskauer Rose LLP

Eleven Times Square

New York, New York 10036

Facsimile No.: (212) 969-2900

Attention: Peter M. Fass, Esq.

Steven L. Lichtenfeld, Esq.

 

The Manager:ARC Properties
Advisors, LLC

405 Park Avenue 15th Floor

New York, New York 10022

Facsimile No.: (212) 421-5799

Attention: Nicholas S. Schorsch

 

with a copy to:

 

Proskauer Rose LLP

Eleven Times Square

New York, New York 10036

Facsimile No.: (212) 969-2900

Attention: Peter M. Fass, Esq.

Steven L. Lichtenfeld, Esq.

 

(b)Binding
Nature of Agreement; Successors and Assigns; No Third Party Beneficiaries. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective heirs, legal representatives, successors and permitted assigns as provided
herein. Except as provided in this Agreement with respect to indemnification of Indemnified Parties hereunder, nothing in this
Agreement shall confer any rights upon any Person other than the parties hereto and their respective heirs, legal representatives,
successors and permitted assigns.

 

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(c)Integration.
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.

 

(d)Amendments.
This Agreement, nor any terms hereof, may not be amended, supplemented or modified except in an instrument in writing executed
by the parties hereto.

 

(e)GOVERNING
LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE
PARTIES HERETO IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE UNITED STATES DISTRICT
COURT LOCATED IN THE BOROUGH OF MANHATTAN, NEW YORK CITY, FOR THE PURPOSE OF ANY ACTION OR JUDGMENT RELATING TO OR ARISING OUT
OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY AND TO THE LAYING OF VENUE IN SUCH COURT.

 

(f)WAIVER
OF JURY TRIAL. EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO
INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND, THEREFORE, EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY ACTION DIRECTLY
OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT.

 

(g)Survival
of Representations and Warranties. All representations and warranties made hereunder, and in any document, certificate or statement
delivered pursuant hereto or in connection herewith, shall survive the execution and delivery of this Agreement.

 

(h)No
Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of a party hereto, any right, remedy,
power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies,
powers and privileges provided by law.

 

(i)Costs
and Expenses. Each party hereto shall bear its own costs and expenses (including the fees and disbursements of counsel and
accountants) incurred in connection with the negotiations and preparation of and the closing under this Agreement, and all matters
incident thereto. If any party hereto initiates any legal action arising out of or in connection with this Agreement, the prevailing
party shall be entitled to recover from the other party all reasonable attorneys’ fees, expert witness fees and expenses
incurred by the prevailing party in connection therewith.

 

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(j)Section
Headings. The section and subsection headings in this Agreement are for convenience in reference only and shall not be deemed
to alter or affect the interpretation of any provisions hereof.

 

(k)Counterparts.
This Agreement may be executed (including by facsimile transmission) with counterpart signature pages or in any number of separate
counterparts, and all of which taken together shall be deemed to constitute one and the same instrument.

 

(l)Severability.
Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other
jurisdiction.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK]

 

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IN WITNESS WHEREOF, each of the parties
hereto has executed this Amended and Restated Management Agreement as of the date first written above.

 

	 	AMERICAN REALTY CAPITAL PROPERTIES, INC.
	 	 
	 	By: 	/s/ Nicholas S. Schorsch
	 	 	Name: Nicholas S. Schorsch
	 	 	Title: Chief Executive Officer

 

	 	ARC PROPERTIES ADVISORS, LLC
	 	 
	 	By:	AR CAPITAL, LLC
	 	 	Its sole member
	 	 	 
	 	By: 	/s/ Brian S. Block
	 	 	Name: Brian S. Block
	 	 	Title: Authorized Signatory

 

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Exhibit A

 

Investment
Guidelines

 

1.No investment
shall be made that would cause the Company to fail to qualify as a REIT under the Code.

 

2.No investment
shall be made that would cause the Company to be regulated as an investment company under the Investment Company Act.

 

3.The Company’s
investments shall be in the Target Assets.

 

4.Until
appropriate investments in the Target Assets are identified, the Manager may invest the proceeds of the Initial Public Offering
and any future offerings of the Company’s securities for cash in interest-bearing, short-term investments and money market
accounts and/or funds, subject to the requirements for the Company’s qualification as a REIT under the Code.

 

5.Before
issuing any final form of commitment to acquire a Real Estate Asset, the transaction must be approved by the Manager Investment
Committee.

 

6.Any proposed
investment in a Real Estate Asset must be approved by a majority of the Independent Directors (or a committee established by the
Independent Directors for this purpose). If a proposed investment in a Real Estate Asset is for less than $10 million, such approval
may be sought via electronic board meetings, which entails emailing of the applicable materials to the Independent Directors (or
the members of the committee established by the Independent Directors for this purpose) and any questions to be addressed in advance
of voting on the proposed investment in a Real Estate Asset and requesting a response for approval, and whereby the Independent
Directors (or the members of the committee established by the Independent Directors for this purpose) cast their votes in favor
or against a proposed acquisition via email.

 

These Investment Guidelines
may be amended, restated, modified, supplemented or waived by the Board (which must include a majority of the Independent Directors)
without the approval of the Company’s stockholders.

 

    	27

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