Document:

Business Loan Agreement and Promissory Note

 Exhibit 10.1 
 BUSINESS LOAN AGREEMENT 
  

															
	 Principal
	  	 Loan Data
	  	 Maturity
	  	 Loan No
	  	 Call / Coll
	  	 Account
	  	 Officer
	  	 Initials

	$7,000,000.00	  	12-03-2010	  	12-02-2011	  		  		  		  		  	
	
	 References in the boxes above are for Lender’s use only and do not limit the
applicability of this document to any particular loan or item.
 Any item above containing “***” has been omitted due to
text length limitations.

  

							
	Borrower:	  	 Fremont Michigan InsuraCorp, Inc.
 933 East Main Street
 Fremont, Ml 49412
	  	Lender:	  	 THE HUNTINGTON NATIONAL BANK
 Grand Rapids Commercial Lending
 50 Monroe Place - MI224

50 Monroe Avenue NW
 Grand Rapids, Ml
49503

  
  

THIS BUSINESS LOAN AGREEMENT dated December 3, 2010, is made and executed between Fremont Michigan InsuraCorp, Inc. (“Borrower”) and
THE HUNTINGTON NATIONAL BANK (“Lender”) on the following terms and conditions. Borrower has received prior commercial loans from Lender or has applied to Lender for a commercial loan or loans or other financial accommodations, including
those which may be described on any exhibit or schedule attached to this Agreement. Borrower understands and agrees that: (A) in granting, renewing, or extending any Loan, Lender is relying upon Borrower’s representations, warranties, and
agreements as set forth in this Agreement; (B) the granting, renewing, or extending of any Loan by Lender at all times shall be subject to Lender’s sole judgment and discretion; and (C) all such Loans shall be and remain subject to
the terms and conditions of this Agreement. 
 TERM. This Agreement shall be effective as of December 3, 2010, and shall
continue in full force and effect until such time as all of Borrower’s Loans in favor of Lender have been paid in full, including principal, interest, costs, expenses, attorneys’ fees, and other fees and charges, or until such time as the
parties may agree in writing to terminate this Agreement. 
 CONDITIONS PRECEDENT TO EACH ADVANCE. Lender’s obligation to make the
initial Advance and each subsequent Advance under this Agreement shall be subject to the fulfillment to Lender’s satisfaction of all of the conditions set forth in this Agreement and in the Related Documents. 

Loan Documents. Borrower shall provide to Lender the following documents for the Loan: (1) the Note; (2) Security
Agreements granting to Lender security interests in the Collateral; (3) financing statements and all other documents perfecting Lender’s Security Interests; (4) evidence of insurance as required below; (5) together with all such
Related Documents as Lender may require for the Loan; all in form and substance satisfactory to Lender and Lender’s counsel. 
 Borrower’s Authorization. Borrower shall have provided in form and substance satisfactory to Lender properly certified resolutions, duly authorizing the execution and delivery of this
Agreement, the Note and the Related Documents. In addition, Borrower shall have provided such other resolutions, authorizations, documents and instruments as Lender or its counsel, may require. 

Payment of Fees and Expenses. Borrower shall have paid to Lender all fees, charges, and other expenses which are then due and
payable as specified in this Agreement or any Related Document. 
 Representations and Warranties. The representations and
warranties set forth in this Agreement, in the Related Documents, and in any document or certificate delivered to Lender under this Agreement are true and correct. 
 No Event of Default. There shall not exist at the time of any Advance a condition which would constitute an Event of Default under this Agreement or under any Related Document. 

REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender, as of the date of this Agreement, as of the date of each disbursement
of loan proceeds, as of the date of any renewal, extension or modification of any Loan, and at all times any Indebtedness exists: 
 Organization. Borrower is a corporation for profit which is, and at all times shall be, duly organized, validly existing, and in good standing under and by virtue of the laws of the State of
Michigan. Borrower is duly authorized to transact business in all other states in which Borrower is doing business, having obtained all necessary filings, governmental licenses and approvals for each state in which Borrower is doing business.
Borrower maintains an office at 933 East Main Street, Fremont, Ml 49412. Unless Borrower has designated otherwise in writing, the principal office is the office at which Borrower keeps its books and records including its records concerning the
Collateral. Borrower will notify Lender prior to any change in the location of Borrower’s state of organization or any change in Borrower’s name. 
 Assumed Business Names. Borrower has filed or recorded all documents or filings required by law relating to all assumed business names used by Borrower. Excluding the name of Borrower, the
following is a complete list of all assumed business names under which Borrower does business: None. 
 Authorization.
Borrower’s execution, delivery, and performance of this Agreement and all the Related Documents have been duly authorized by all necessary action by Borrower and do not conflict with, result in a violation of, or constitute a default under
(1) any provision of (a) Borrower’s articles of incorporation or organization, or bylaws, or (b) any agreement or other instrument binding upon Borrower or (2) any law, governmental regulation, court decree, or order
applicable to Borrower or to Borrower’s properties. 
 Properties. Except as contemplated by this Agreement or as
previously disclosed in Borrower’s financial statements or in writing to Lender and as accepted by Lender, and except for property tax liens for taxes not presently due and payable, Borrower owns and has good title to all of Borrower’s
properties free and clear of all liens and security interests, and has not executed any security documents or financing statements relating to such properties. All of Borrower’s properties are titled in Borrower’s legal name, and Borrower
has not used or filed a financing statement under any other name for at least the last five (5) years. 
 AFFIRMATIVE COVENANTS.
Borrower covenants and agrees with Lender that, so long as this Agreement remains in effect, Borrower will: 
 Notices of
Claims and Litigation. Promptly inform Lender in writing of (1) all material adverse changes in Borrower’s financial condition, and (2) all existing and all threatened litigation, claims, investigations, administrative proceedings
or similar actions affecting Borrower or any Guarantor which could materially affect the financial condition of Borrower or the financial condition of any Guarantor. 
 Financial Records. Maintain its books and records in accordance with accounting principles acceptable to Lender, applied on a consistent basis, and permit Lender to examine and audit
Borrower’s books and records at all reasonable times. 
 Financial Statements. Furnish Lender with such financial
statements and other related information at such frequencies and in such detail as Lender may reasonably request. 
 Loan
Proceeds. Use all Loan proceeds solely for Borrower’s business operations, unless specifically consented to the contrary by Lender in writing. 
 Taxes, Charges and Liens. Pay and discharge when due all of its indebtedness and obligations, including without limitation all assessments, taxes, governmental charges, levies and liens, of every
kind and nature, imposed upon Borrower or its properties, income, or profits, prior to the date on which penalties would attach, and all lawful claims that, if unpaid, might become a lien or charge upon any of Borrower’s properties, income, or
profits. Provided however, Borrower will not be required to pay and discharge any such assessment, tax, charge, levy, lien or claim so long as (1) the legality of the same shall be contested in good faith by appropriate proceedings, and
(2) Borrower shall have established on Borrower’s books adequate reserves with respect to such contested assessment, tax, charge, levy, lien, or claim in accordance with GAAP. 

Performance. Perform and comply, in a timely manner, with all terms, conditions, and provisions set forth in this Agreement, in the
Related Documents, and in all other instruments and agreements between Borrower and Lender. Borrower shall notify Lender immediately in writing of any default in connection with any agreement. 

Operations. Maintain executive and management personnel with substantially the same qualifications and experience as the present
executive and management personnel; provide written notice to Lender of any change in executive and management personnel; conduct its business affairs in a reasonable and prudent manner. 

Compliance with Governmental Requirements. Comply with all laws, ordinances, and regulations, now or hereafter in effect, of all
governmental authorities applicable to the conduct of Borrower’s properties, businesses and operations, and to the use or occupancy of the Collateral, including without limitation, the Americans With Disabilities Act. Borrower may contest in
good faith any such law, ordinance, or regulation and withhold compliance during any proceeding, including appropriate appeals, so long as Borrower has notified Lender in writing prior to doing so and so long as, in Lender’s sole opinion,
Lender’s interests in the Collateral are not jeopardized. Lender may require Borrower to post adequate security or a surety bond, reasonably satisfactory to Lender, to protect Lender’s interest. 

Inspection. Permit employees or agents of Lender at any reasonable time to inspect any and all Collateral for the Loan or Loans and
Borrower’s other properties and to examine or audit Borrower’s books, accounts, and records and to make copies and memoranda of Borrower’s books, accounts, and records. If Borrower now or at any time hereafter maintains any records
(including without limitation computer generated records and computer software programs for the generation of such records) in the possession of a third party, Borrower, upon request of Lender, shall notify such party to permit Lender free access to
such records at all reasonable times and to provide Lender with copies of any records it may request, all at Borrower’s expense. 

 BUSINESS LOAN AGREEMENT 

(Continued) 

 Page
 2
 
  
  

 

 LENDER’S EXPENDITURES. If any action or proceeding is commenced that would materially affect
Lender’s interest in the Collateral or if Borrower fails to comply with any provision of this Agreement or any Related Documents, including but not limited to Borrower’s failure to discharge or pay when due any amounts Borrower is required
to discharge or pay under this Agreement or any Related Documents, Lender on Borrower’s behalf may (but shall not be obligated to) take any action that Lender deems appropriate on any Collateral and paying all costs for insuring, maintaining
and preserving any Collateral. All such expenditures incurred or paid by Lender for such purposes will then bear interest at the rate charged under the Note from the date incurred or paid by Lender to the date of repayment by Borrower. All such
expenses will become a part of the Indebtedness and, at Lender’s option, will (A) be payable on demand; (B) be added to the balance of the Note and be apportioned among and be payable with any installment payments to become due during
either (1) the term of any applicable insurance policy; or (2) the remaining term of the Note; or (C) be treated as a balloon payment which will be due and payable at the Note’s maturity. 

NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that while this Agreement is in effect, Borrower shall not, without the prior
written consent of Lender: 
 Continuity of Operations. (1) Engage in any business activities substantially different
than those in which Borrower is presently engaged, (2) cease operations, liquidate, merge, transfer, acquire or consolidate with any other entity, change its name, dissolve or transfer or sell Collateral out of the ordinary course of business,
or (3) pay any dividends on Borrower’s stock (other than dividends payable in its stock), provided, however that notwithstanding the foregoing, but only so long as no Event of Default has occurred and is continuing or would result from the
payment of dividends, if Borrower is a “Subchapter S Corporation” (as defined in the Internal Revenue Code of 1986, as amended), Borrower may pay cash dividends on its stock to its shareholders from time to time in amounts necessary to
enable the shareholders to pay income taxes and make estimated income tax payments to satisfy their liabilities under federal and state law which arise solely from their status as Shareholders of a Subchapter S Corporation because of their ownership
of shares of Borrower’s stock, or purchase or retire any of Borrower’s outstanding shares or alter or amend Borrower’s capital structure. 
 Agreements. Enter into any agreement containing any provisions which would be violated or breached by the performance of Borrower’s obligations under this Agreement or in connection herewith.

 CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan to Borrower, whether under this Agreement or under any other
agreement, Lender shall have no obligation to make Loan advances or to disburse Loan proceeds if: (A) Borrower or any guarantor is in default under the terms of this Agreement or any other agreement that Borrower or any guarantor has with
Lender; (B) Borrower or any guarantor dies, becomes incompetent or becomes insolvent, files a petition in bankruptcy or similar proceedings, or is adjudged a bankrupt; (C) there occurs a material adverse change in Borrower’s financial
condition, in the financial condition of any guarantor, or in the value of any collateral securing any Loan; or (D) any guarantor seeks, claims or otherwise attempts to limit, modify or revoke such guarantor’s guaranty of the Loan or any
other loan with Lender; or (E) Lender in good faith deems itself insecure, even though no Event of Default shall have occurred. 
 RIGHT
OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in all Borrower’s accounts with Lender (whether checking, savings, or some other account). This includes all accounts Borrower holds jointly with
someone else and all accounts Borrower may open in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on the Indebtedness against any and all such accounts. 
 DEFAULT. Each of the
following shall constitute an Event of Default under this Agreement: 
 Payment Default. Borrower fails to make any
payment when due under the Loan. 
 Other Default. Borrower fails to comply with any other term, obligation, covenant or
condition contained in this Agreement or in any of the Related Documents. 
 Default in Favor of Third Parties. Borrower
defaults under any loan, extension of credit, security agreement, purchase or sales agreement, or any other agreement, in favor of any other creditor or person that may materially affect any of Borrower’s property or Borrower’s ability to
repay the Loans or perform Borrower’s obligations under this Agreement or any related document. 
 False Statements.
Any representation or statement made by Borrower to Lender is false in any material respect. 
 Insolvency. The
dissolution or termination of Borrower’s existence as a going business, the insolvency of Borrower, the appointment of a receiver for any part of Borrower’s property, any assignment for the benefit of creditors, any type of creditor
workout, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against Borrower. 
 Creditor or
Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help, repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing
the Loan. 
 Events Affecting Guarantor. Any of the preceding events occurs with respect to any Guarantor of any of the
Indebtedness or any Guarantor dies or becomes incompetent, or revokes or disputes the validity of, or liability under, any Guaranty of the Indebtedness. 
 Change in Ownership. Any change in ownership of twenty-five percent (25%) or more of the common stock of Borrower. 
 Insecurity. Lender in good faith believes itself insecure. 
 EFFECT OF AN EVENT OF
DEFAULT. If any Event of Default shall occur, except where otherwise provided in this Agreement or the Related Documents, all commitments and obligations of Lender under this Agreement immediately will terminate (including any obligation to make
further Loan Advances or disbursements), and, at Lender’s option, all Indebtedness immediately will become due and payable, all without notice of any kind to Borrower, except that in the case of an Event of Default of the type described in the
“Insolvency” subsection above, such acceleration shall be automatic and not optional. In addition, Lender shall have all the rights and remedies provided in the Related Documents or available at law, in equity, or otherwise. Except as may
be prohibited by applicable law, all of Lender’s rights and remedies shall be cumulative and may be exercised singularly or concurrently. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to
make expenditures or to take action to perform an obligation of Borrower or of any Grantor shall not affect Lender’s right to declare a default and to exercise its rights and remedies. 
 DEPOSIT ACCOUNT. Borrower shall maintain all operating deposit accounts with Lender. 

ANNUAL CPA AUDIT. Borrower shall deliver or cause to be delivered to Lender within one hundred twenty ( 120 ) days after the end of each fiscal
year, an audit of Borrower’s financial condition and/or Borrower’s assets which constitute security for the loan, prepared by an independent certified public accountant satisfactory to Lender. 

INTERIM FINANCIAL STATEMENTS. Borrower shall furnish Lender with, as soon as available, but in no event later than forty-five ( 45 ) days after
the end of each fiscal quarter, beginning on September 30, 2010, Borrower’s financial statement, including a balance sheet and income statement and statement of cash flow for the period ended, prepared by Borrower and certified by
Borrower’s president, chief financial officer or other officer or person acceptable to Lender as fairly representing Borrower’s financial condition and results of operations as of the end of such period. 

MINIMUM DEPOSIT BALANCE. Borrower shall maintain at all times an average daily collected balance of not less than $2,300,000 in one or more
deposit accounts established in Borrower’s name with Lender and maintained by Borrower in good standing. Lender’s calculation of the average daily collected balance in such account or accounts with Lender shall be final absent manifest
error. 
 AM BEST RATING. Borrower shall maintain at all times an minimum A.M. Best rating of B + (Secure). 

DEBT TO CAPITALIZATION PERCENTAGE. Borrower shall maintain a Debt to Capitalization Percentage of not more than 25% measured as of the end of each
fiscal quarter beginning on 09/30/2010. As used herein, “Debt to Capitalization Percentage” means the percentage resulting from dividing Borrower’s Total Funded Debt by the sum of Borrower’s Total Funded Debt and shareholder
equity. As used herein, Total Funded Debt shall mean the sum of the amounts for such period of all debt obligations outstanding including short term and long term debt and capital lease obligations. 

SECURITY INTEREST/COLLATERAL. Lender acknowledges that Borrower’s indebtedness to Lender is currently not secured by any Security Interest,
Security Agreement or Collateral, and so long as no such Security Interest, Security Agreement, or Collateral has been provided to Lender by Borrower or any other Grantor as security for any Loan, then all references herein to a Security Agreement,
Security Interest, or Collateral and/or the execution of any agreements or instruments or financing statements pertaining thereto shall not be in effect. 
 ACQUISITIONS. Notwithstanding anything herein to the contrary, Borrower may, without Lender’s prior consent, make acquisition of other entities from time to time, including entering into
merger transactions whereby Borrower is the surviving entity, so long as such acquisition-merger transaction does not result in a change of control of Borrower and so long as at the time of such acquisition transaction there is no then uncured Event
of Default hereunder or under any other Related Document (or any other then existing event or condition which but for the giving of notice or passage of time would constitute an Event of Default), and so long as such transaction and
acquisition/merger transaction related expenditures will not result in Borrower being in breach of any financial covenant of this Agreement or any other Related Document. 

 BUSINESS LOAN AGREEMENT 

(Continued) 

 Page
 3
 
  
  

 

 DEFINITIONS. The following capitalized words and terms shall have the following meanings when
used in this Agreement. Unless specifically stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms used in the singular shall include the plural, and the plural
shall include the singular, as the context may require. Words and terms not otherwise defined in this Agreement shall have the meanings attributed to such terms in the Uniform Commercial Code. Accounting words and terms not otherwise defined in this
Agreement shall have the meanings assigned to them in accordance with generally accepted accounting principles as in effect on the date of this Agreement: 
 Advance. The word “Advance” means a disbursement of Loan funds made, or to be made, to Borrower or on Borrower’s behalf on a line of credit or multiple advance basis under the terms
and conditions of this Agreement. 
 Agreement. The word “Agreement” means this Business Loan Agreement, as this
Business Loan Agreement may be amended or modified from time to time, together with all exhibits and schedules attached to this Business Loan Agreement from time to time. 
 Borrower. The word “Borrower” means Fremont Michigan InsuraCorp, Inc. and includes all co-signers and co-makers signing the Note and all their successors and assigns. 

Collateral. The word “Collateral” means alt property and assets granted as collateral security for a Loan, whether real
or personal property, whether granted directly or indirectly, whether granted now or in the future, and whether granted in the form of a security interest, mortgage, collateral mortgage, deed of trust, assignment, pledge, crop pledge, chattel
mortgage, collateral chattel mortgage, chattel trust, factor’s lien, equipment trust, conditional sale, trust receipt, lien, charge, lien or title retention contract, lease or consignment intended as a security device, or any other security or
lien interest whatsoever, whether created by law, contract, or otherwise. 
 Event of Default. The words “Event of
Default” mean any of the events of default set forth in this Agreement in the default section of this Agreement. 

GAAP. The word “GAAP” means generally accepted accounting principles. 

Grantor. The word “Grantor” means each and all of the persons or entities granting a Security Interest in any Collateral
for the Loan, including without limitation all Borrowers granting such a Security Interest. 
 Guarantor. The word
“Guarantor” means any guarantor, surety, or accommodation party of any or all of the Loan. 
 Guaranty. The word
“Guaranty” means the guaranty from Guarantor to Lender, including without limitation a guaranty of all or part of the Note. 
 Indebtedness. The word “Indebtedness” means the indebtedness evidenced by the Note or Related Documents, including all principal and interest together with all other indebtedness and
costs and expenses for which Borrower is responsible under this Agreement or under any of the Related Documents. 

Lender. The word “Lender” means THE HUNTINGTON NATIONAL BANK, its successors and assigns. 

Loan. The word “Loan” means any and all loans and financial accommodations from Lender to Borrower whether now or
hereafter existing, and however evidenced, including without limitation those loans and financial accommodations described herein or described on any exhibit or schedule attached to this Agreement from time to time. 

Note. The word “Note” means the Note executed by Fremont Michigan InsuraCorp, Inc. in the principal amount of
$7,000,000.00 dated December 3, 2010, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the note or credit agreement. 

Related Documents. The words “Related Documents” mean all promissory notes, credit agreements, loan agreements,
environmental agreements, guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements and documents, whether now or hereafter existing, executed in connection with the Loan.

 Security Agreement. The words “Security Agreement” mean and include without limitation any agreements,
promises, covenants, arrangements, understandings or other agreements, whether created by law, contract, or otherwise, evidencing, governing, representing, or creating a Security Interest. 

Security Interest. The words “Security Interest” mean, without limitation, any and all types of collateral security,
present and future, whether in the form of a lien, charge, encumbrance, mortgage, deed of trust, security deed, assignment, pledge, crop pledge, chattel mortgage, collateral chattel mortgage, chattel trust, factor’s lien, equipment trust,
conditional sale, trust receipt, lien or title retention contract, lease or consignment intended as a security device, or any other security or lien interest whatsoever whether created by law, contract, or otherwise. 

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT AND BORROWER AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS
DATED DECEMBER 3, 2010. 
 BORROWER: 
  

			
	FREMONT MICHIGAN INSURACORP, INC.
		
	By:	 	 /s/ Richard Dunning

		 	Richard Dunning, President and CEO of Fremont Michigan InsuraCorp, Inc.
	
	LENDER:
	
	THE HUNTINGTON NATIONAL BANK
		
	By:	 	 /s/ Mandee Rick

		 	Authorized Signer

  
  

 
 LASER PRO Lending. Ver. 5.53.10.003
Cope. Harland Financial Solutions. Inc. 1997, 2010 All Rights Reserved MI C: LaserPro _Prod\CFI\LPL\C40.FC TR-176710 PR-COMMLIB3 

 PROMISSORY NOTE 

 

															
	 Principal
	  	 Loan Date
	  	 Maturity
	  	 Loan No
	  	 Call / Coll
	  	 Account
	  	 Officer
	  	 Initials

	 $7,000,000,00
	  	12-03-2010	  	12-02-2011	  		  		  		  		  	
	
	 References in the boxes above are for Lender’s use only and do not limit the
applicability of this document to any particular loan or item.
 Any item above containing “* * *” has been omitted due
to text length limitations.

  

							
	Borrower:	  	 Fremont Michigan InsuraCorp, Inc.
 933 East Main Street
 Fremont, Ml 49412
	  	Lender:	  	 THE HUNTINGTON NATIONAL BANK
 Grand Rapids Commercial Lending
 50 Monroe Place - MI224

50 Monroe Avenue NW
 Grand Rapids, Ml
49503

  
  

 

			
	Principal Amount: $7,000,000.00	  	Date of Note: December 3, 2010

PROMISE TO PAY. Fremont Michigan InsuraCorp, Inc. (“Borrower”) promises to pay to THE HUNTINGTON NATIONAL BANK (“Lender”), or
order, in lawful money of the United States of America, the principal amount of Seven Million & 00/100 Dollars ($7,000,000.00) or so much as may be outstanding, together with interest on the unpaid outstanding principal balance of each
advance. Interest shall be calculated from the date of each advance until repayment of each advance. 
 PAYMENT. Borrower will pay this
loan in one payment of all outstanding principal plus all accrued unpaid interest on December 2, 2011. In addition. Borrower will pay regular monthly payments of all accrued unpaid interest due as of each payment date, beginning
January 18, 2011. with all subsequent interest payments to be due on the same day of each month after that. Unless otherwise agreed or required by applicable law, payments will be applied first to any accrued unpaid interest; then to principal;
then to any unpaid collection costs; and then to any late charges. Borrower will pay Lender at Lender’s address shown above or at such other place as Lender may designate in writing. 
 VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from time to time based on changes in an independent index which is the LIBO Rate. As used herein, LIBO Rate shall mean
the rate obtained by dividing: (1) the actual or estimated per annum rate, or the arithmetic mean of the per annum rates, of interest for deposits in U.S. dollars for the related LIBO Rate Interest Period (as hereinafter defined), as determined
by Lender in its discretion based upon reference to information which appears on page LIBORO1, captioned British Bankers Assoc. Interest Settlement Rates, of the Reuters America Network, a service of Reuters America Inc. (or such other page that may
replace that page on that service for the purpose of displaying London interbank offered rates; or, if such service ceases to be available or ceases to be used by Lender, such other reasonably comparable money rate service as Lender may select) or
upon information obtained from any other reasonable procedure, as of two Banking Days (as hereinafter defined) prior to the first day of a LIBO Rate Interest Period; by (2) an amount equal to one minus the stated maximum rate (expressed as a
decimal), if any, of all reserve requirements (including, without limitation, any marginal, emergency, supplemental, special or other reserves) that is specified on the first day of each LIBO Rate Interest Period by the Board of Governors of the
Federal Reserve System (or any successor agency thereto) for determining the maximum reserve requirement with respect to eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D of such Board) maintained by
a member bank of such System, or any other regulations of any governmental authority having jurisdiction with respect thereto as conclusively determined by the Lender. Subject to any maximum or minimum interest rate limitation specified herein or by
applicable law, any variable rate of interest on the obligation evidenced hereby shall change automatically without notice to the Borrower on the first day of each LIBO Rate Interest Period (the “Index”). The Index is not necessarily the
lowest rate charged by Lender on its loans. If the Index becomes unavailable during the term of this loan, Lender may designate a substitute index after notifying Borrower. Lender will tell Borrower the current Index rate upon Borrower’s
request. The interest rate change will not occur more often than each month. Borrower understands that Lender may make loans based on other rates as well. The Index currently is 0.258% per annum. Interest on the unpaid principal balance of this
Note will be calculated as described in the “INTEREST CALCULATION METHOD” paragraph using a rate of 2.500 percentage points over the Index, resulting in an initial rate of 2.758% per annum based on a year of 360 days. NOTICE: Under no
circumstances will the interest rate on this Note be more than the maximum rate allowed by applicable law. 
 INTEREST CALCULATION METHOD.
Interest on this Note is computed on a 365/360 basis; that is, by applying the ratio of the interest rate over a year of 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is
outstanding. All interest payable under this Note is computed using this method. 
 PREPAYMENT. Borrower may pay without penalty all
or a portion of the amount owed earlier than it is due. Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower’s obligation to continue to make payments of accrued unpaid interest. Rather, early payments
will reduce the principal balance due. Borrower agrees not to send Lender payments marked “paid in full”, “without recourse”, or similar language. If Borrower sends such a payment, Lender may accept it without losing any of
Lender’s rights under this Note, and Borrower will remain obligated to pay any further amount owed to Lender. All written communications concerning disputed amounts, including any check or other payment instrument that indicates that the
payment constitutes “payment in full” of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount must be mailed or delivered to: The Huntington National Bank, Commercial
Customer Support, 2361 Morse Road - NC1W26 Columbus, OH 43229. 
 LATE CHARGE. If a payment is 11 days or more late, Borrower will be
charged 5.000% of the regularly scheduled payment. 
 INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity,
the interest rate on this Note shall be increased by adding an additional 3.000 percentage point margin (“Default Rate Margin”). The Default Rate Margin shall also apply to each succeeding interest rate change that would have applied had
there been no default. However, in no event will the interest rate exceed the maximum interest rate limitations under applicable law, 

DEFAULT. Each of the following shall constitute an event of default (“Event of Default”) under this Note: 

Payment Default. Borrower fails to make any payment when due under this Note. 

Other Defaults. Borrower fails to comply with or to perform any other term, obligation, covenant or condition contained in this
Note or in any of the related documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between Lender and Borrower. 

Default in Favor of Third Parties. Borrower or any Grantor defaults under any loan, extension of credit, security agreement,
purchase or sales agreement, or any other agreement, in favor of any other creditor or person that may materially affect any of Borrower’s property or Borrower’s ability to repay this Note or perform Borrower’s obligations under this
Note or any of the related documents. 
 False Statements. Any warranty, representation or statement made or furnished to
Lender by Borrower or on Borrower’s behalf under this Note or the related documents is false or misleading in any material respect, either now or at the time made or furnished or becomes false or misleading at any time thereafter. 

Insolvency. The dissolution or termination of Borrower’s existence as a going business, the insolvency of Borrower, the
appointment of a receiver for any part of Borrower’s property, any assignment for the benefit of creditors, any type of creditor workout, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against Borrower.

 Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial
proceeding, self-help, repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the loan. This includes a garnishment of any of Borrower’s accounts, including deposit accounts,
with Lender. However, this Event of Default shall not apply if there is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if Borrower gives Lender
written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond for
the dispute. 
 Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor, endorser,
surety, or accommodation party of any of the indebtedness or any guarantor, endorser, surety, or accommodation party dies or becomes incompetent, or revokes or disputes the validity of, or liability under, any guaranty of the indebtedness evidenced
by this Note. 
 Change In Ownership. Any change in ownership of twenty-five percent (25%) or more of the common
stock of Borrower. 
 Adverse Change. A material adverse change occurs in Borrower’s financial condition, or Lender
believes the prospect of payment or performance of this Note is impaired. 
 Insecurity. Lender in good faith believes
itself insecure. 
 LENDER’S RIGHTS. Upon default, Lender may declare the entire unpaid principal balance under this Note and all
accrued unpaid interest immediately due, and then Borrower will pay that amount. 
 ATTORNEYS’ FEES; EXPENSES. Lender may hire or
pay someone else to help collect this Note if Borrower does not pay. Borrower will pay Lender that amount. This includes, subject to any limits under applicable law, Lender’s reasonable attorneys’ fees and Lender’s legal expenses
whether or not there is a lawsuit including reasonable attorneys’ fees and expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), and appeals. If not prohibited by applicable law, Borrower
also will pay any court costs, in addition to all other sums provided by law. 

 PROMISSORY NOTE 

(Continued) 

Page 2 
  

 
  

 JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial In any action, proceeding,
or counterclaim brought by either Lender or Borrower against the other. 
 GOVERNING LAW. This Note will be governed by federal law
applicable to Lender and, to the extent not preempted by federal law, the laws of the State of Michigan without regard to its conflicts of law provisions. This Note has been accepted by Lender in the State of Michigan. 

DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $15.00 if Borrower makes a payment on Borrower’s loan and the check or
preauthorized charge with which Borrower pays is later dishonored. 
 RIGHT OF SETOFF. To the extent permitted by applicable law, Lender
reserves a right of setoff in all Borrower’s accounts with Lender (whether checking, savings, or some other account). This includes all accounts Borrower holds jointly with someone else and all accounts Borrower may open in the future. However,
this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing on the indebtedness against
any and all such accounts. 
 LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under this Note, as well as
directions for payment from Borrower’s accounts, may be requested orally or in writing by Borrower or by an authorized person. Lender may, but need not, require that all oral requests be confirmed in writing. Borrower agrees to be liable for
all sums either: (A) advanced in accordance with the instructions of an authorized person or (B) credited to any of Borrower’s accounts with Lender. The unpaid principal balance owing on this Note at any time may be evidenced by
endorsements on this Note or by Lender’s internal records, including daily computer print-outs. 
 FINANCIAL STATEMENTS. Borrower
agrees to furnish from time to time on the request of the Lender true and complete financial statements and such other information as the Lender may reasonably require. 
 PROCESSING FEE. Borrower shall pay to Lender on the date of this Note a processing fee in the amount of $1,000.00. Lender and Borrower agree that the fee shall be fully earned by Lender on the date
of this Note. 
 ADDITIONAL LIBO RATE PROVISIONS. As used herein, Banking Day shall mean any day other than a Saturday or a Sunday on
which banks are open for business in Columbus, Ohio, and on which banks in London, England, settle payments. 
 As used herein, LIBO Rate
Interest Period shall mean one (1) month(s), provided that: (1) if any LIBO Rate Interest Period would otherwise expire on a day which is not a Banking Day, the LIBO Rate Interest Period shall be extended to the next succeeding Banking Day
(provided, however, that if such next succeeding Banking Day occurs in the following calendar month, then the LIBO Rate Interest Period shall expire on the immediately preceding Banking Day). 
 In the event that Lender reasonably determines that by reason of (1) any change arising after the date of this Note affecting the interbank eurocurrency market or affecting the position of the Lender
with respect to such market, adequate and fair means do not exist for ascertaining the applicable interest rates by reference to which the LIBO Rate then being determined is to be fixed, (2) any change arising after the date of this Note in any
applicable law or governmental rule, regulation or order (or any interpretation thereof, including the introduction of any new law or governmental rule, regulation or order), or (3) any other circumstance affecting the Lender or the interbank
market (such as, but not limited to, official reserve requirements required by Regulation D of the Board of Governors of the Federal Reserve System), the LIBO Rate plus the applicable spread shall not represent the effective pricing to the Lender of
accruing interest hereunder based upon the LIBO Rate, then, and in any such event, the accruing of interest hereunder based upon the LIBO Rate shall be suspended until Lender shall notify the Borrower that the circumstances causing such suspension
no longer exist. In such case, beginning on the date of such suspension interest shall accrue hereunder at a variable rate of interest per annum, which shall change in the manner set forth below, equal to
             percentage points in excess of the Prime Commercial Rate (as hereinafter defined). 
 In the event that on any date Lender shall have reasonably determined that accruing interest hereunder based upon the LIBO Rate has become unlawful by compliance by the Lender in good faith with any law,
governmental rule, regulation or order, then, and in any such event, the Lender shall promptly give notice thereof to the Borrower. In such case, accruing interest hereunder based upon the LIBO Rate shall be terminated and the Borrower shall, at the
earlier of the end of each LIBO Rate Interest Period then in effect or when required by law, repay the advances based upon the LIBO Rate, together with all interest accrued thereon. In such case, when required by law, interest shall accrue hereunder
at a variable rate of interest per annum, which shall change in the manner set forth below, equal to              percentage points in excess of the Prime Commercial Rate.

 As used herein, Prime Commercial Rate shall mean the rate established by Lender from time to time based on its consideration of economic,
money market, business and competitive factors, and it is not necessarily the Lender’s most favored rate. Subject to any maximum or minimum interest rate limitation specified herein or by applicable law, any variable rate of interest on the
obligation evidenced hereby based upon the Prime Commercial Rate shall change automatically without notice to the Borrower immediately with each change in the Prime Commercial Rate. If during any period of time while interest is accruing hereunder
based upon the Prime Commercial Rate the obligation evidenced by this Note is not paid at maturity, whether maturity occurs by lapse of time, demand, acceleration or otherwise, the unpaid principal balance and any unpaid interest thereon shall,
thereafter until paid, bear interest at a rate equal to              percentage points (which shall be 0.00 percentage points, unless completed) in excess of the rate indicated in
the immediately preceding two paragraphs. 
 If, due to (1) the introduction of or any change in or in the interpretation of any law or
regulation, (2) the compliance with any guideline or request from any central bank or other public authority (whether or not having the force of law), or (3) the failure of the Borrower to repay any advance when required by the terms of
this Note, there shall be any loss or increase in the cost to the Lender of accruing interest hereunder based upon the LIBO Rate, then the Borrower agrees that the Borrower shall, from time to time, upon demand by the Lender, pay to the Lender
additional amounts sufficient to compensate the Lender for such loss or increased cost. A certificate as to the amount of such loss or increase cost, submitted to the Borrower by the Lender, shall be conclusive evidence, absent manifest error, of
the correctness of such amount. 
 Notwithstanding the section above captioned PREPAYMENT, during any period of time while interest is accruing
hereunder based upon the LIBO Rate Borrower may not prepay any portion of the outstanding principal balance prior to the expiration of the then current LIBO Rate Interest Period. 
 PAYMENT DATES. If the due date of any payment under this Note shall be a day that is not a Banking Day (as defined herein), the due date shall be extended to the next succeeding Banking Day;
provided, however, that if such next succeeding Banking Day occurs in the following calendar month, then the due date shall be the immediately preceding Banking Day. 
 DETERMINATION OF INDEX. This Note expresses an initial interest rate and an initial index value to 3 places to the right of the decimal point. This expression is done solely for convenience. The
reference sources for the index used by Lender, as stated in this Note, may actually quote the index on any given day to as many as 5 places to the right of the decimal point. Therefore, the actual index value used to calculate the interest rate on
and the amount of interest due under this Note will be to 5 places to the right of the decimal point. 
 IMPORTANT INFORMATION ABOUT
PROCEDURES REQUIRED BY THE USA PATRIOT ACT. To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each
entity or person who opens an account or establishes a relationship with the Lender. 
 What this means: When an entity or person opens an
account or establishes a relationship with the Lender, the Lender may ask for the name, address, date of birth, and other information that will allow the Lender to identify the entity or person who opens an account or establishes a relationship with
the Lender. The Lender may also ask to see identifying documents for the entity or person. 
 ADDITIONAL DEFAULT. In addition to those
events described as Events of Default in the Section of this Note captioned DEFAULT, it shall constitute an Event of Default under this Note if Borrower fails to comply with or to perform any term, obligation, covenant or condition contained in any
interest rate protection agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement between Borrower and Lender. 

LINE MUST BE RESTED. Borrower covenants that on and after the date of this Note, Borrower shall reduce the outstanding principal balance of the
Note to, and maintain the outstanding principal balance at, zero for a period of thirty ( 30 ) consecutive days during each calendar year. 

SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Borrower, and upon Borrower’s heirs, personal representatives, successors
and assigns, and shall inure to the benefit of Lender and its successors and assigns. 
 GENERAL PROVISIONS. If any part of this Note
cannot be enforced, this fact will not affect the rest of the Note. Lender may delay or forgo enforcing any of its rights or remedies under this Note without losing them. Borrower and any other person who signs, guarantees or endorses this Note, to
the extent allowed by law, waive presentment, demand for payment, and notice of dishonor. Upon any change in the terms of this Note, and unless otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor,
accommodation maker or endorser, shall be released from liability. All such parties agree that Lender may renew or extend (repeatedly and for any length of time) this loan or release any party or guarantor or collateral; or impair, fail to realize
upon or perfect Lender’s security interest in the collateral; and take any other action deemed necessary by Lender without the consent of or notice to anyone. All such parties also agree that Lender may modify this loan without the consent of
or notice to anyone other than the party with whom the modification is made. The obligations under this Note are joint and several. 

 PROMISSORY NOTE 

(Continued) 

Page 3 
  

 
  

 PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING
THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE. 
 BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF
THIS PROMISSORY NOTE. 
 BORROWER: 
  

			
	FREMONT MICHIGAN INSURACORP, INC.
		
	By:	 	 /s/ Richard Dunning

		 	Richard Dunning, President and CEO of Fremont Michigan InsuraCorp, Inc.

  
  

 
 LASER PRO Lending. Ver. 5.53.10.003
Cope. Harland Financial Solutions. Inc. 1997, 2010 All Rights Reserved MI C: LaserPro _Prod\CFI\LPL\C40.FC TR-176710 PR-COMMLIB3Dealer Manager Agreement

 Exhibit 10.1 
 KBS REAL ESTATE INVESTMENT TRUST III , INC. 
 Up to 280,000,000 Shares of Common
Stock 
 DEALER MANAGER AGREEMENT 
 October 26, 2010 
 KBS Capital Markets Group LLC 

660 Newport Center Drive, Suite 1200 
 Newport
Beach, California 92660 
 Ladies and Gentlemen: 
 KBS Real Estate Investment Trust III, Inc., a Maryland corporation (the “Company”), has registered for public sale 280,000,000 shares of its common stock, $.01 par value per share (the
“Shares”), of which 80,000,000 Shares are intended to be offered pursuant to the Company’s dividend reinvestment plan (the “DRP”). The Company desires for KBS Capital Markets Group LLC (the “Dealer
Manager”) to act as its agent in connection with the offer and sale of the Shares to the public (the “Offering”). 
 It is anticipated that the Dealer Manager will enter into Selected Dealer Agreements (in the form attached to this Agreement as Exhibit A) with other broker-dealers participating in the Offering (each
participating broker-dealer being referred to herein as a “Dealer”). The Company shall have the right to approve any material modifications or addendums to the form of the Selected Dealer Agreement. 

Except as described in the Prospectus (as defined below) or in Section 5.3 hereof, the Shares are to be sold at a per Share
cash price as follows: 
  

							
	Distribution Channel	  	Primary
Offering
Shares	 	  	DRP Shares
	 Sales through a Dealer earning transaction-based compensation
	  	$	10.00	  	  	$ 9.50
	 Sales through all other distribution channels as discussed in the Prospectus
	  	$	 9.35	  	  	$ 9.50

 In connection
with the sale of Shares, the Company hereby agrees with you, the Dealer Manager, as follows: 

  

	1.	Representations and Warranties of the Company. As an inducement to the Dealer Manager to enter into this Agreement, the Company represents and warrants to the
Dealer Manager and to each Dealer that: 

  

	 	1.1.	The Company has prepared and filed with the Securities and Exchange Commission (the “SEC”) a registration statement (Registration No. 333-164703)
that has become effective for the registration of the Shares under the Securities Act of 1933, as amended (the “Securities Act”), and the applicable rules and regulations (the “Rules and Regulations”) of the SEC
promulgated thereunder. Copies of such registration statement as initially filed and each amendment thereto have been or will be delivered to the Dealer Manager. The registration statement and the prospectus contained therein, as finally amended at
the effective date of the registration statement (the “Effective Date”), are respectively hereinafter referred to as the “Registration Statement” and the “Prospectus,” except that if the Company
files a prospectus or prospectus supplement pursuant to Rule 424(b) under the Securities Act, or if the Company files a post-effective amendment to the Registration Statement, the term “Prospectus” includes the prospectus filed pursuant to
Rule 424(b) or the prospectus included in such post-effective amendment. The term “Preliminary Prospectus” as used herein shall mean a preliminary prospectus related to the Shares as contemplated by Rule 430 or Rule 430A of the
Rules and Regulations included at any time as part of the registration statement. 

  

	 	1.2.	On the Effective Date, on the date of the Prospectus and on the date any post-effective amendment to the Registration Statement becomes effective or any amendment or
supplement to the Prospectus is filed with the SEC, the Registration Statement and the Prospectus, as applicable, including the financial statements contained therein, complied or will comply with the Securities Act and the Rules and Regulations. On
the Effective Date, the Registration Statement did not or will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. On the date of the Prospectus, as amended or supplemented, as applicable, the Prospectus did not or will not contain any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Notwithstanding anything contained herein to the contrary, the Company’s
representations in this Section 1.2 will not extend to such statements contained in or omitted from the Registration Statement or the Prospectus, as amended or supplemented, that are primarily within the knowledge of the Dealer Manager
or any of the Dealers and are based upon information furnished by the Dealer Manager in writing to the Company specifically for inclusion therein. 

  
 2 

	 	1.3.	No order preventing or suspending the use of any Preliminary Prospectus or the Prospectus has been issued and no proceedings for that purpose are pending, threatened
or, to the knowledge of the Company, contemplated by the SEC; and, to the knowledge of the Company, no order suspending the offering of the Shares in any jurisdiction has been issued and no proceedings for that purpose have been instituted or
threatened or are contemplated. 

  

	 	1.4.	The Company intends to use the funds received from the sale of the Shares as set forth in the Prospectus. 

 

	 	1.5.	The Company has full legal right, power and authority to enter into this Agreement and to perform the transactions contemplated hereby, except to the extent that the
enforceability of the indemnity provisions contained in Section 6 of this Agreement may be limited under applicable securities laws and to the extent that the enforceability of this Agreement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws that affect creditors’ rights generally or by equitable principles relating to the availability of remedies. 

 

	 	1.6.	The execution and delivery of this Agreement, the consummation of the transactions contemplated herein and compliance with the terms of this Agreement by the Company
will not conflict with or constitute a default or violation under any charter, bylaw, contract, indenture, mortgage, deed of trust, lease, rule, regulation, writ, injunction or decree of any government, governmental instrumentality or court,
domestic or foreign, having jurisdiction over the Company, except to the extent that the enforceability of the indemnity provisions contained in Section 6 of this Agreement may be limited under applicable securities law and to the extent
that the enforceability of this Agreement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws that affect creditors’ rights generally or by equitable principles relating to the availability of remedies.

  

	 	1.7.	No consent, approval, authorization or other order of any governmental authority is required in connection with the execution or delivery by the Company of this
Agreement or the issuance and sale by the Company of the Shares, except as may be required under the Securities Act and the Rules and Regulations thereunder, by the Financial Industry Regulatory Authority (“FINRA”) or under
applicable state securities laws. 

  

	 	1.8.	The Shares have been duly authorized and, when issued and sold as contemplated by the Prospectus and the Company’s charter, as amended and supplemented, and upon
payment therefor as provided in the Prospectus and this Agreement, the Shares will be validly issued, fully paid and nonassessable and will conform to the description thereof contained in the Prospectus. 

  
 3 

  

	2.	Representations and Warranties of the Dealer Manager. As an inducement to the Company to enter into this Agreement, the Dealer Manager represents and warrants to
the Company that: 

  

	 	2.1.	The Dealer Manager is a member in good standing of FINRA and a broker-dealer registered as such under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). The Dealer Manager and its employees and representatives have all required licenses and registrations to act under this Agreement. 

 

	 	2.2.	The Dealer Manager represents and warrants to the Company and each person that signs the Registration Statement that the information under the caption “Plan of
Distribution” in the Prospectus, as amended and supplemented, and all other information furnished and to be furnished to the Company by the Dealer Manager in writing expressly for use in the Registration Statement, any Preliminary Prospectus or
the Prospectus, does not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. 

 

	3.	Covenants of the Company. The Company covenants and agrees with the Dealer Manager that: 

 

	 	3.1.	It will, at no expense to the Dealer Manager, furnish the Dealer Manager with such number of printed copies of the Registration Statement, including all amendments and
exhibits thereto, as the Dealer Manager may reasonably request. It will similarly furnish to the Dealer Manager and others designated by the Dealer Manager as many copies as the Dealer Manager may reasonably request in connection with the offering
of the Shares of: (a) the Prospectus, including any amendments and supplements thereto and (b) this Agreement. 

  

	 	3.2.	The Company will prepare and file with the appropriate regulatory authorities, on behalf of and at no expense to the Dealer Manager, the printed sales literature or
other materials authorized by the Company to be used in the Offering (“Authorized Sales Materials”). In addition, the Company will furnish the Dealer Manager and others designated by the Dealer Manager, at no expense to the Dealer
Manager, with such number of printed copies of Authorized Sales Materials as the Dealer Manager may reasonably request. 

  

	 	3.3.	 The Company will furnish such information and execute and file such documents as may be necessary for it to qualify the Shares for offer and sale under
the securities laws of such jurisdictions as the Dealer Manager may reasonably designate and will file and make in each year such statements and reports as may be required. The Company will furnish to

  
 4 

	 	 
the Dealer Manager upon request a copy of such papers filed by the Company in connection with any such qualification. 

 

	 	3.4.	It will: (a) file every amendment or supplement to the Registration Statement or the Prospectus that may be required by the SEC or any state securities
administration and (b) if at any time the SEC shall issue any stop order suspending the effectiveness of the Registration Statement or any state securities administration shall issue any order or take other action to suspend or enjoin the sale
of the Shares, it will promptly notify the Dealer Manager. 

  

	 	3.5.	If at any time when a Prospectus is required to be delivered under the Securities Act and the Rules and Regulations thereunder any event occurs as a result of which, in
the opinion of either the Company or the Dealer Manager, the Prospectus would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in view of the circumstances under which they
were made, not misleading, the Company will promptly notify the Dealer Manager thereof (unless the information shall have been received from the Dealer Manager) and will prepare an amendment or supplement to the Prospectus that will correct such
statement or omission. 

  

	 	3.6.	It will comply with all requirements imposed upon it by the Securities Act and the Exchange Act, by the rules and regulations of the SEC promulgated thereunder and by
all securities laws and regulations of those states in which an exemption has been obtained or qualification of the Shares has been effected, to permit the continuance of offers and sales of the Shares in accordance with the provisions hereof and of
the Prospectus. 

  

	 	3.7.	 The Company will pay all expenses incident to the performance of its obligations under this Agreement, including (a) the preparation, filing and
printing of the Registration Statement as originally filed and of each amendment thereto, (b) the preparation, printing and delivery to the Dealer Manager of this Agreement, the Selected Dealer Agreement and such other documents as may be
required in connection with the offer, sale, issuance and delivery of the Shares, (c) the fees and disbursements of the Company’s counsel, accountants and other advisors, (d) the fees and expenses related to the review of the terms
and fairness of the Offering by FINRA, (e) the fees and expenses related to the registration and qualification of the Shares under federal and state securities laws, including the fees and disbursements of counsel in connection with the
preparation of any Blue Sky survey and any supplement thereto, (f) the printing and delivery to the Dealer Manager of copies of any Preliminary Prospectus and the Prospectus, including any amendments and supplements thereto, (g) the fees
and expenses of any registrar or transfer agent in connection with the Shares and (h) the costs and expenses of the Company relating to the preparation and printing of any Authorized Sales

  
 5 

	 	 
Materials and Company-approved investor presentations undertaken in connection with the marketing of the Shares, including, without limitation, expenses associated with the production of slides
and graphics, fees and expenses of any consultants engaged in connection with presentations with the prior approval of the Company and travel and lodging expenses of the representatives of the Company and any such consultants.

  

	4.	Covenants of the Dealer Manager. The Dealer Manager covenants and agrees with the Company that: 

 

	 	4.1.	In connection with the Dealer Manager’s participation in the offer and sale of Shares (including, without limitation, any resales and transfers of Shares), the
Dealer Manager will comply, and in its agreements with Dealers will require that the Dealers comply, with all requirements and obligations imposed upon any of them by (a) the Securities Act, the Exchange Act and the rules and regulations of the
SEC promulgated under both such acts, including the obligation to deliver a copy of the Prospectus as amended or supplemented; (b) all applicable state securities laws and regulations as from time to time in effect; (c) the applicable
rules of FINRA, including, but not in any way limited to, Rules 2440, 2730, 2740 and 2750 of the NASD Conduct Rules and FINRA Rule 2310; (d) all applicable rules and regulations relating to the suitability of the investors, including, without
limitation, the provisions of Articles III.C and III.E of the Statement of Policy regarding Real Estate Investment Trusts of the North American Securities Administrators Association, Inc. (“NASAA Guidelines”); (e) any other
state and federal laws and regulations applicable to the Offering, the sale of Shares or the activities of the Dealer Manager pursuant to this Agreement, including without limitation the privacy standards and requirements of state and federal laws,
including the Gramm-Leach-Bliley Act of 1999, and the laws governing money laundering abatement and anti-terrorist financing efforts, including the applicable rules of the SEC and FINRA, the Bank Secrecy Act, as amended, the USA Patriot Act of 2001
and regulations administered by the Office of Foreign Asset Control at the Department of the Treasury; and (f) this Agreement and the Prospectus as amended and supplemented. 

 

	 	4.2.	The Dealer Manager will not offer the Shares, and in its agreements with Dealers will require that the Dealers not offer Shares, in any jurisdiction unless and until
(a) the Dealer Manager has been advised by the Company in writing that the Shares are either registered in accordance with, or exempt from, the securities laws of such jurisdiction and (b) the Dealer Manager and any Dealer offering Shares
in such jurisdiction have all required licenses and registrations to offer Shares in that jurisdiction. 

  

	 	4.3.	 The Dealer Manager will make, and in its agreements with Dealers will require that Dealers make, no representations concerning the Offering

  
 6 

	 	 
except as set forth in the Prospectus as amended and supplemented and in the Authorized Sales Materials. 

 

	 	4.4.	The Dealer Manager will offer Shares, and in its agreements with Dealers will require that the Dealers offer Shares, only to persons who meet the financial
qualification and suitability standards set forth in the Prospectus as amended and supplemented or in any suitability letter or memorandum sent to the Dealer Manager by the Company. The Dealer Manager further agrees that the Company, in its sole and
absolute discretion, may accept or reject any subscription, in whole or in part, for any reason whatsoever and no commission will be paid to the Dealer Manager with respect to the portion of any subscription that is rejected.

 The Dealer Manager shall maintain, or in its agreements with Dealers shall require the Dealers to maintain,
for at least six years, a record of the information obtained to determine that an investor meets the financial qualification and suitability standards imposed on the offer and sale of the Shares (both at the time of the initial subscription and at
the time of any additional subscriptions, including initial enrollments and increased participations in the DRP). 
 In making
these determinations as to financial qualification and suitability, the Dealer Manager may rely on representations from (i) investment advisers who are not affiliated with a Dealer or (ii) banks acting as trustees or fiduciaries. With
respect to the Dealer Manager’s obligation to maintain records of an investor’s financial qualification and suitability, the Company agrees that the Dealer Manager can satisfy its obligations by contractually requiring such information to
be maintained by the investment advisers or banks discussed in the preceding sentence. 
  

	 	4.5.	Except for Authorized Sales Materials, the Company has not authorized the use of any supplemental literature or sales material in connection with the Offering and the
Dealer Manager agrees not to use any such material that has not been authorized by the Company. The Dealer Manager further agrees (a) not to deliver any Authorized Sales Materials to any person unless it is accompanied or preceded by the
Prospectus as amended and supplemented, (b) not to show or give to any investor or prospective investor or reproduce any material or writing that is supplied to it by the Company and marked “broker-dealer use only” or otherwise
bearing a legend denoting that it is not to be used in connection with the sale of Shares to members of the public and (c) not to show or give to any investor or prospective investor in a particular jurisdiction any material or writing that is
supplied to it by the Company if such material bears a legend denoting that it is not to be used in connection with the sale of Shares to members of the public in such jurisdiction. 

  
 7 

  

	 	4.6.	The Dealer Manager agrees to be bound by the terms of the Escrow Agreement dated September 17, 2010, among UMB Bank, N.A., as escrow agent, the Dealer Manager and
the Company, copies of which are attached hereto as Exhibit B and the Dealer Manager further agrees that it will not represent or imply that UMB Bank, N.A., as the escrow agent identified in the Prospectus, has investigated the desirability
or advisability of an investment in the Company or has approved, endorsed or passed upon the merits of the Shares or of the Company, nor will the Dealer Manager use the name of said escrow agent in any manner whatsoever in connection with the offer
or sale of the Shares other than by acknowledgment that it has agreed to serve as escrow agent. 

  

	 	4.7.	The Dealer Manager will provide the Company with such information relating to the offer and sale of the Shares by it as the Company may from time to time reasonably
request or as may be requested to enable the Company to prepare such reports of sale as may be required to be filed under applicable federal or state securities laws. 

 

	 	4.8.	The Dealer Manager will permit a Dealer to participate in the Offering only if such Dealer is a member of FINRA. 

 

	5.	Obligations and Compensation of Dealer Manager. 

  

	 	5.1.	The Company hereby appoints the Dealer Manager as its agent and principal distributor during the Offering Period (as defined in Section 5.2) for the purpose
of finding, on a best-efforts basis, purchasers for the Shares for cash through the distribution channels contemplated herein. The Dealer Manager may also arrange for the sale of Shares for cash directly to clients and customers identified by the
Company on the terms and conditions stated herein and in the Prospectus. The Dealer Manager hereby accepts such agency and distributorship and agrees to use its best efforts to find purchasers for the Shares on said terms and conditions.

  

	 	5.2.	 The “Offering Period” shall mean that period during which Shares may be offered for sale, commencing on the Effective Date of the
Registration Statement (but in no event prior to the Effective Date of the Registration Statement), during which period offers and sales of the Shares shall occur continuously in the jurisdictions in which the Shares are registered or qualified or
exempt from registration (as confirmed in writing by the Company to the Dealer Manager) unless and until the Offering is terminated, provided that the Dealer Manager and the Dealers will suspend or terminate offering Shares upon request of the
Company at any time and will resume offering Shares upon subsequent request of the Company. The Offering Period shall in all events terminate upon the sale of all of the Shares. Upon termination of the Offering Period, the Dealer Manager’s
agency and this Agreement shall terminate without obligation 

  
 8 

	 	 
on the part of the Dealer Manager or the Company except as set forth in this Agreement. 

  

	 	5.3.	Except as may be provided in the “Plan of Distribution” section of the Prospectus, which may be amended and supplemented from time to time, as compensation
for the services rendered by the Dealer Manager, the Company agrees that it will pay to the Dealer Manager selling commissions plus a dealer manager fee as follows: 

 

					
	 	  	Selling Commissions
			
	Distribution Channel	  	Primary
Offering
Shares	 	DRP Shares
	 Sales through a Dealer earning transaction-based compensation
	  	6.5%*	 	0.0%*
	 Sales through all other distribution channels as described in the Prospectus
	  	0.0%  	 	0.0%  

 * Except
as set forth herein or in the “Plan of Distribution” section of the Prospectus (as amended and supplemented), the Dealer Manager will reallow all of its selling commissions attributable to a Dealer. 

 

					
	 	  	Dealer Manager Fee
			
	Distribution Channel	  	Primary
Offering
Shares	 	DRP Shares
	 Sales through a Dealer earning transaction-based compensation
	  	3.0%*	 	0.0%
	 Sales through all other distribution channels as described in the Prospectus
	  	3.0%*	 	0.0%

 * Upon the terms set
forth herein or in the Prospectus (as amended and supplemented), the Dealer Manager may agree to reallow to any Dealer a portion of its dealer manager fee pursuant to a separate marketing fee agreement. 

Upon the terms set forth in the Prospectus, reduced selling commissions and dealer manager fees will be paid to the Dealer Manager and
reduced per share selling prices shall be recovered on large transactions in accordance with the following table, which may be amended and supplemented by the Prospectus: 

 

							
	Dollar Volume Shares Purchased	  	Sales
Commissions
(Based on $10.00
Price Per Share)	 	Dealer
Manager Fee
(Based on $10.00
Price Per Share)	 	Price Per
Share to
Investor
	
$                0      to  
    $   999,999
	  	6.5%	 	3.0%	 	$10.00
	 $  1,000,000      to      $1,999,999
	  	5.5%	 	3.0%	 	$  9.90
	 $  2,000,000      to      $2,999,999
	  	4.5%	 	3.0%	 	$  9.80
	 $  3,000,000      to      $3,999,999
	  	3.5%	 	2.5%	 	$  9.65
	 $  4,000,000      to      $9,999,999
	  	2.0%	 	2.5%	 	$  9.50
	 $10,000,000     and above
	  	1.0%	 	2.0%	 	$  9.35

  
 9 

 The reduced selling price, selling commission and dealer manager fee will apply to the
entire purchase. All commission rates and dealer manager fees are calculated assuming a price per share of $10.00. For example, a purchase of 250,000 shares in a single transaction would result in a purchase price of $2,450,000 ($9.80 per share),
selling commissions of $112,500 and dealer manager fees of $75,000. 
 The Company will also reimburse the Dealer Manager for
all items of underwriter compensation referenced in the Prospectus to the extent the Prospectus indicates that they will be paid by the Company, provided that the Company’s reimbursement payments shall not cause (i) total underwriting
compensation to exceed 10% of gross proceeds from the Offering (excluding proceeds from the offering of Shares pursuant to the DRP), or (ii) total organization and offering expenses to exceed 15% of gross proceeds from the Offering. In
accordance with FINRA Rule 2310, the Company shall also pay directly or reimburse the Dealer Manager for bona fide invoiced due diligence expenses of the Dealers and non-participating broker-dealers, subject to the cap on organization and offering
expenses described above. 
 As described in the Prospectus, the Dealer Manager agrees to sell up to 5% of the Shares in the
primary offering to persons identified by the Company pursuant to the Company’s “friends and family” program. The purchase price for Shares under this program will be $9.35 per share, reflecting that selling commissions will not be
payable in connection with such sales. The Dealer Manager agrees to work together with the Company to implement this program and to execute sales under the program according to the procedures agreed upon by the Dealer Manager and the Company.

 In addition, as described in the Prospectus, the Dealer Manager may sell shares to Dealers, their retirement plans, their
representatives and the family members, IRAs and the qualified plans of their representatives at a purchase price of $9.35 per share, reflecting that selling commissions in the amount of $0.65 per share will not be payable in consideration of the
services rendered by such Dealers and representatives in the Offering. For purposes of this discount, a family member includes such person’s spouse, parent, child, sibling, mother- or father-in-law, son- or daughter-in law or brother- or
sister-in-law. 
 Notwithstanding the foregoing, no commissions, payments or amounts whatsoever will be paid to the Dealer
Manager under this Section 5.3 unless or until the Company raises $2.5 million in the Offering from persons not affiliated with the Company, its sponsors or its advisor (the “Minimum Offering”). Until the Minimum
Offering is reached, investments will be held in escrow. Until $100.0 million (the “Pennsylvania Minimum”) has been raised in the Offering from persons 

  
 10 

 
not affiliated with the Company, its sponsors or its advisor, investments from Pennsylvania investors will be held in a segregated account held by the escrow agent and no commissions, payments or
amounts whatsoever will be paid thereon to the Dealer Manager under this Section 5.3 unless and until the Pennsylvania Minimum has been reached, and then only with respect to such investments from Pennsylvania investors as are released
to the Company from such escrow. Until $10 million (the “Tennessee Minimum”) has been raised in the Offering from persons not affiliated with the Company, its sponsors or its advisor, investments from Tennessee investors will be
held in a segregated account held by the escrow agent and no commissions, payments or amounts whatsoever will be paid thereon to the Dealer Manager under this Section 5.3 unless and until the Tennessee Minimum has been reached, and then
only with respect to such investments from Tennessee investors as are released to the Company from such escrow. If the Minimum Offering is not reached within the time period specified in the Prospectus, investments will be returned to the investors
in accordance with the Prospectus. If the Pennsylvania Minimum is not obtained within the time period specified in the Prospectus, the investments from Pennsylvania investors will be returned or held for subsequent escrow periods in accordance with
the Prospectus. If the Tennessee Minimum is not obtained within the time period specified in the Prospectus, the investments from Tennessee investors will be returned to Tennessee investors in accordance with the Prospectus. 

The Company will not be liable or responsible to any Dealer for direct payment of commissions to such Dealer; it is the sole and
exclusive responsibility of the Dealer Manager for payment of commissions to Dealers. Notwithstanding the above, at its discretion, the Company may act as agent of the Dealer Manager by making direct payment of commissions to such Dealers without
incurring any liability therefor. 
  

	6.	Indemnification. 

  

	 	6.1.	 To the extent permitted by the Company’s charter and the provisions of Article II.G of the NASAA Guidelines, and subject to the limitations below,
the Company will indemnify and hold harmless the Dealers and the Dealer Manager, their officers and directors and each person, if any, who controls such Dealer or Dealer Manager within the meaning of Section 15 of the Securities Act (the
“Indemnified Persons”) from and against any losses, claims, damages or liabilities (“Losses”), joint or several, to which such Indemnified Persons may become subject, under the Securities Act, the Exchange Act or
otherwise, insofar as such Losses (or actions in respect thereof) arise out of or are based upon (a) any untrue statement or alleged untrue statement of a material fact contained (i) in the Registration Statement, the Prospectus, any
Preliminary Prospectus used prior to the effective date of the Registration Statement or any post-effective amendment or supplement to any of them or (ii) in any blue sky

  
 11 

 
application or other document executed by the Company or on its behalf specifically for the purpose of qualifying any or all of the Shares for sale under the securities laws of any jurisdiction
or based upon written information furnished by the Company under the securities laws thereof (any such application, document or information being hereinafter called a “Blue Sky Application”) or (iii) in any Authorized Sales
Materials, or (b) the omission or alleged omission to state in the Registration Statement, the Prospectus, any Preliminary Prospectus used prior to the effective date of the Registration Statement or any post-effective amendment or supplement
to any of them or in any Blue Sky Application or Authorized Sales Materials a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The
Company will reimburse each Indemnified Person for any legal or other expenses reasonably incurred by such Indemnified Person in connection with investigating or defending such Loss. 

Notwithstanding the foregoing provisions of this Section 6.1, the Company will not be liable in any such case to the extent
that any such Loss or expense arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity with written information furnished (x) to the Company by the
Dealer Manager or (y) to the Company or the Dealer Manager by or on behalf of any Dealer specifically for use in the Registration Statement, the Prospectus, any Preliminary Prospectus used prior to the effective date of the Registration
Statement or any post-effective amendment or supplement to any of them, any Blue Sky Application or any Authorized Sales Materials, and, further, the Company will not be liable in any such case if it is determined that such Dealer or the Dealer
Manager was at fault in connection with the Loss, expense or action. 
 The foregoing indemnity agreement of this
Section 6.1 is subject to the further condition that, insofar as it relates to any untrue statement, alleged untrue statement, omission or alleged omission made in the Prospectus (or amendment or supplement thereto) that was eliminated
or remedied in any subsequent amendment or supplement thereto, such indemnity agreement shall not inure to the benefit of an Indemnified Party from whom the person asserting any Losses purchased the Shares that are the subject thereof, if a copy of
the Prospectus as so amended or supplemented was not sent or given to such person at or prior to the time the subscription of such person was accepted by the Company, but only if a copy of the Prospectus as so amended or supplemented had been
supplied to the Dealer Manager or the Dealer prior to such acceptance.  
  

	 	6.2.	 The Dealer Manager will indemnify and hold harmless the Company, its officers and directors (including any person named in the Registration

  
 12 

 
Statement, with his consent, as about to become a director), each other person who has signed the Registration Statement and each person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act (the “Company Indemnified Persons”), from and against any Losses to which any of the Company Indemnified Persons may become subject, under the Securities Act, the Exchange Act or otherwise,
insofar as such Losses (or actions in respect thereof) arise out of or are based upon (a) any untrue statement or alleged untrue statement of a material fact contained (i) in the Registration Statement, the Prospectus, any Preliminary
Prospectus used prior to the effective date of the Registration Statement or any post-effective amendment or supplement to any of them or in any Blue Sky Application or Authorized Sales Materials; or (b) the omission or alleged omission to
state in the Registration Statement, the Prospectus, any Preliminary Prospectus used prior to the effective date of the Registration Statement or any post-effective amendment or supplement to any of them or in any Blue Sky Application or Authorized
Sales Materials a material fact required to be stated therein or necessary to make the statements therein not misleading, provided that clauses (a) and (b) apply, to the extent, but only to the extent, that such untrue statement or
omission was made in reliance upon and in conformity with written information furnished to the Company by or on behalf of the Dealer Manager specifically for use with reference to the Dealer Manager in the preparation of the Registration Statement,
the Prospectus, any Preliminary Prospectus used prior to the effective date of the Registration Statement or any post-effective amendment or supplement to any of them or in preparation of any Blue Sky Application or Authorized Sales Materials; or
(c) any use of sales literature not authorized or approved by the Company or any use of “broker-dealer use only” materials with members of the public by the Dealer Manager in the offer and sale of the Shares or any use of sales
literature in a particular jurisdiction if such material bears a legend denoting that it is not to be used in connection with the sale of Shares to members of the public in such jurisdiction; or (d) any untrue statement made by the Dealer
Manager or its representatives or agents or omission to state a fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading in connection with the offer and sale of the Shares; or
(e) any material violation of this Agreement; or (f) any failure to comply with applicable laws governing privacy issues, money laundering abatement and anti-terrorist financing efforts, including applicable rules of the SEC, FINRA and the
USA PATRIOT Act of 2001; or (g) any other failure to comply with applicable rules of FINRA or federal or state securities laws and the rules and regulations promulgated thereunder. The Dealer Manager will reimburse the aforesaid parties for any
legal or other expenses reasonably incurred by them in connection with investigating or defending such Loss, expense or action. This indemnity agreement will be in addition to any liability that the Dealer Manager may otherwise have. 

  
 13 

	 	6.3.	 Each Dealer severally will indemnify and hold harmless the Company, the Dealer Manager, each of their officers and directors (including any person
named in the Registration Statement, with his consent, as about to become a director), each other person who has signed the Registration Statement and each person, if any, who controls the Company or the Dealer Manager within the meaning of
Section 15 of the Securities Act (the “Dealer Indemnified Persons”) from and against any Losses to which a Dealer Indemnified Person may become subject, under the Securities Act, the Exchange Act or otherwise, insofar as such
Losses (or actions in respect thereof) arise out of or are based upon (a) any untrue statement or alleged untrue statement of a material fact contained (i) in the Registration Statement, the Prospectus, any Preliminary Prospectus used
prior to the effective date of the Registration Statement or any post-effective amendment or supplement to any of them or in any Blue Sky Application or Authorized Sales Materials; or (b) the omission or alleged omission to state in the
Registration Statement, the Prospectus, any Preliminary Prospectus used prior to the effective date of the Registration Statement or any post-effective amendment or supplement to any of them or in any Blue Sky Application or Authorized Sales
Materials a material fact required to be stated therein or necessary to make the statements therein not misleading, provided that clauses (a) and (b) apply, to the extent, but only to the extent, that such untrue statement or omission was
made in reliance upon and in conformity with written information furnished to the Company or the Dealer Manager by or on behalf of the Dealer specifically for use with reference to the Dealer in the preparation of the Registration Statement, the
Prospectus, any Preliminary Prospectus used prior to the effective date of the Registration Statement or any post-effective amendment or supplement to any of them or in preparation of any Blue Sky Application or Authorized Sales Materials; or
(c) any use of sales literature not authorized or approved by the Company or any use of “broker-dealer use only” materials with members of the public by the Dealer in the offer and sale of the Shares or any use of sales literature in
a particular jurisdiction if such material bears a legend denoting that it is not to be used in connection with the sale of Shares to members of the public in such jurisdiction; or (d) any untrue statement made by the Dealer or its
representatives or agents or omission to state a fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading in connection with the offer and sale of the Shares; or (e) any
material violation of this Agreement or the Selected Dealer Agreement entered into between the Dealer Manager and the Dealer; or (f) any failure to comply with applicable laws governing privacy issues, money laundering abatement and
anti-terrorist financing efforts, including applicable rules of the SEC, FINRA and the USA PATRIOT Act of 2001; or (g) any other failure to comply with applicable rules of FINRA or federal or state securities laws and the rules and regulations
promulgated thereunder. Each such Dealer will reimburse 

  
 14 

	 	 
each Dealer Indemnified Person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such Loss, expense or action. This indemnity agreement
will be in addition to any liability that such Dealer may otherwise have. 

  

	 	6.4.	Promptly after receipt by an indemnified party under this Section 6 of notice of the commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party under this Section 6, notify in writing the indemnifying party of the commencement thereof. The failure of an indemnified party to so notify the indemnifying party will relieve
the indemnifying party from any liability under this Section 6 as to the particular item for which indemnification is then being sought, but not from any other liability that it may have to any indemnified party. In case any such action
is brought against any indemnified party, and it notifies an indemnifying party of the commencement thereof, the indemnifying party will be entitled, to the extent it may wish, jointly with any other indemnifying party similarly notified, to
participate in the defense thereof, with separate counsel. Such participation shall not relieve such indemnifying party of the obligation to reimburse the indemnified party for reasonable legal and other expenses (subject to Section 6.5)
incurred by such indemnified party in defending itself, except for such expenses incurred after the indemnifying party has deposited funds sufficient to effect the settlement, with prejudice, of the claim in respect of which indemnity is sought. Any
such indemnifying party shall not be liable to any such indemnified party on account of any settlement of any claim or action effected without the consent of such indemnifying party. Any indemnified party shall not be bound to perform or refrain
from performing any act pursuant to the terms of any settlement of any claim or action effected without the consent of such indemnified party. 

  

	 	6.5.	 The indemnifying party shall pay all legal fees and expenses of the indemnified party in the defense of such claims or actions; provided, however, that
the indemnifying party shall not be obliged to pay legal expenses and fees to more than one law firm in connection with the defense of similar claims arising out of the same alleged acts or omissions giving rise to such claims notwithstanding that
such actions or claims are alleged or brought by one or more parties against more than one indemnified party. If such claims or actions are alleged or brought against more than one indemnified party, then the indemnifying party shall only be obliged
to reimburse the expenses and fees of the one law firm that has been selected by a majority of the indemnified parties against which such action is finally brought; and in the event a majority of such indemnified parties are unable to agree on which
law firm for which expenses or fees will be reimbursable by the indemnifying party, then payment shall be made to the first law firm of record representing an indemnified party against the action or claim. Such law firm shall be paid only to the
extent 

  
 15 

	 	 
of services performed by such law firm and no reimbursement shall be payable to such law firm on account of legal services performed by another law firm. 

 

	7.	Survival of Provisions. 

  

	 	7.1.	The respective agreements, representations and warranties of the Company and the Dealer Manager set forth in this Agreement shall remain operative and in full force and
effect regardless of (a) any investigation made by or on behalf of the Dealer Manager or any Dealer or any person controlling the Dealer Manager or any Dealer or by or on behalf of the Company or any person controlling the Company and
(b) the acceptance of any payment for the Shares. 

  

	 	7.2.	The respective agreements and obligations of the Company and the Dealer Manager set forth in Sections 3.7, 4.1, 4.4, 4.6, 4.7, 5.3, 6 through 10 and 12 through
13 of this Agreement shall remain operative and in full force and effect regardless of (a) any investigation made by or on behalf of the Dealer Manager or any Dealer or any person controlling the Dealer Manager or any Dealer or by or on
behalf of the Company or any person controlling the Company, (b) the acceptance of any payment for the Shares and (c) the termination of this Agreement. 

 

	8.	Applicable Law and Invalid Provision. 

  

	 	8.1.	This Agreement shall be governed by the laws of the State of Maryland; provided, however, that causes of action for violations of federal or state securities laws shall
not be governed by this Section 8.1. 

  

	 	8.2.	The invalidity or unenforceability of any provision of this Agreement shall not affect the other provisions hereof, and this Agreement shall be construed in all
respects as if such invalid or unenforceable provision was omitted. 

  

	9.	Counterparts. This Agreement may be executed in any number of counterparts. Each counterpart, when executed and delivered, shall be an original contract, but all
counterparts, when taken together, shall constitute one and the same agreement. 

  

	10.	Successors and Assigns. 

  

	 	10.1.	This Agreement shall inure to the benefit of and be binding upon the Dealer Manager and the Company and their respective successors and permitted assigns. This
Agreement shall inure to the benefit of the Dealers to the extent set forth in Sections 1, 3 and 6 hereof. Nothing in this Agreement is intended or shall be construed to give to any other person any right, remedy or claim, except as otherwise
specifically provided herein. 

  
 16 

  

	 	10.2.	No party shall assign this Agreement or any right, interest or benefit under this Agreement without the prior written consent of the other party.

  

	11.	Amendments. This Agreement may only be amended by the written agreement of the Dealer Manager and the Company, except as set forth in Section 5 hereof.

  

	12.	Term. Any party to this Agreement shall have the right to terminate this Agreement on 60 days’ written notice or immediately upon notice to the other party
in the event that such other party shall have failed to comply with any material provision hereof. If not sooner terminated, the Dealer Manager’s agency and this Agreement shall terminate upon termination of the Offering Period without
obligation on the part of the Dealer Manager or the Company, except as set forth in this Agreement. Upon termination of this Agreement, (a) the Company shall pay to the Dealer Manager all accrued amounts payable under Section 5
hereof at such time as such amounts become payable and (b) the Dealer Manager shall promptly deliver to the Company all records and documents in its possession that relate to the Offering and that are not designated as “dealer”
copies. 

  

	13.	Customer Complaints. Each party herby agrees to promptly provide to the other party copies of any written or otherwise documented complaints from customers of
the Dealer Manager or any Dealer received by such party relating in any way to the Offering (including, but not limited to, the manner in which the Shares are offered by the Dealer Manager or the Dealer). 

 

	14.	No Partnership. Nothing in this Agreement shall be construed or interpreted to constitute the Dealer Manager as in association with or in partnership with the
Company; instead, this Agreement shall only constitute the Dealer Manager as a dealer authorized by the Company to sell and to manage the sale by others of the Shares according to the terms set forth in the Registration Statement and the Prospectus
as amended or supplemented and in this Agreement. 

  

	15.	Submission of Orders. 

  

	 	15.1.	 Those persons who purchase Shares will be instructed by the Dealer Manager or the Dealer to make their checks payable to “UMB Bank, N.A., as
escrow agent for KBS Real Estate Investment Trust III, Inc.” or, after the Minimum Offering has been achieved, to the Company, except with respect to Pennsylvania and Tennessee investors. Checks from Pennsylvania and Tennessee investors must be
made payable to “UMB Bank, N.A., as escrow agent for KBS Real Estate Investment Trust III, Inc.” until the Pennsylvania Minimum and Tennessee Minimum, respectively, have been achieved. The Dealer Manager, any agent of the Dealer Manager
and any Dealer receiving a check not conforming to the foregoing instructions shall return such check directly to such subscriber not later than the end of the next business day following its receipt. Checks received by the Dealer Manager, any agent
of the Dealer Manager 

  
 17 

	 	 
or a Dealer that conform to the foregoing instructions shall be transmitted for deposit pursuant to one of the methods described in this Section 15. 

 

	 	15.2.	Where, pursuant to a Dealer’s internal supervisory procedures, internal supervisory review is conducted at the same location at which subscription documents and
checks are received from subscribers, checks will be transmitted by the end of the next business day following receipt by the Dealer for deposit to the escrow agent for the Company or, after the Minimum Offering has been achieved, to the Company or
its agent, except for investments from Pennsylvania and Tennessee investors. The Dealer will transmit checks from Pennsylvania investors for deposit to the escrow agent for the Company or, after the Pennsylvania Minimum has been achieved, to the
Company or its agent. The Dealer will transmit checks from Tennessee investors for deposit to the escrow agent for the Company or, after the Tennessee Minimum has been achieved, to the Company or its agent. 

 

	 	15.3.	Where, pursuant to a Dealer’s internal supervisory procedures, final internal supervisory review is conducted at a different location, checks will be transmitted
by the end of the next business day following receipt by the Dealer to the office of the Dealer conducting such final internal supervisory review (the “Final Review Office”). The Final Review Office will in turn by the end of the
next business day following receipt by the Final Review Office, transmit such checks for deposit to the escrow agent for the Company or, after the Minimum Offering has been achieved, to the Company or its agent, except for investments from
Pennsylvania and Tennessee investors. The Final Review Office will transmit checks from Pennsylvania investors for deposit to the escrow agent for the Company or, after the Pennsylvania Minimum has been achieved, to the Company or its agent. The
Final Review Office will transmit checks from Tennessee investors for deposit to the escrow agent for the Company or, after the Tennessee Minimum has been achieved, to the Company or its agent. 

 

	 	15.4.	 Where the Dealer Manager (or its agent) receives investor proceeds, checks will be transmitted by the Dealer Manager (or its agent) for deposit to the
escrow agent for the Company or, after the Minimum Offering has been achieved, to the Company or its agent (except for investments from Pennsylvania and Tennessee investors) as soon as practicable but in any event by the end of the second business
day following receipt by the Dealer Manager (or its agent). The Dealer Manager (or its agent) will transmit checks from Pennsylvania investors for deposit to the escrow agent for the Company or, after the Pennsylvania Minimum has been achieved, to
the Company or its agent. The Dealer Manager (or its agent) will transmit checks from Tennessee investors for deposit to the escrow agent for the Company or, after the Tennessee Minimum has been

  
 18 

	 	 
achieved, to the Company or its agent. Checks of rejected potential investors will be promptly returned to such potential investors. 

 

	 	15.5.	Notwithstanding the above, the Dealer Manager may authorize certain Dealers that are “$250,000 broker-dealers” to instruct their customers to make their
checks for Shares subscribed for payable directly to the Dealer or authorize a debit from the customer’s account maintained with the Dealer for the amount of shares subscribed for by the customer. In such case, the Dealer will collect the
proceeds of the subscribers’ checks and debits and wire funds to the escrow agent or, if instructed by the Dealer Manager, issue a check for the aggregate amount of the subscription proceeds made payable to the order of the escrow agent, or if
instructed by the Dealer Manager, made payable to “KBS Real Estate Investment Trust III, Inc.” The procedures for the transmittal of checks and wiring of funds of $250,000 broker-dealers will be set forth in the agreements between the
$250,000 broker-dealer and the Dealer Manager. 

 [signature page follows] 

  
 19 

 If the foregoing correctly sets forth our understanding, please indicate your acceptance
thereof in the space provided below for that purpose, whereupon this letter and your acceptance shall constitute a binding agreement between us as of the date first above written. 

 

			
	Very truly yours,
	
	KBS REAL ESTATE INVESTMENT
	    TRUST III, INC.
		
	By:     	 	/s/ Charles J. Schreiber, Jr.
		 	Name:    Charles J. Schreiber, Jr.
		 	Title:    Chief Executive Officer

Accepted and agreed as of the 
 date first above
written. 
  

			
	KBS CAPITAL MARKETS GROUP LLC
		
	By:     	 	/s/ Mike Crimmins
		 	Name:  Mike Crimmins
		 	Title:  CEO/ Managing Director

  
 20 

 EXHIBIT A 
 KBS REAL ESTATE INVESTMENT TRUST III, INC. 
 Up to 280,000,000 Shares of Common
Stock 
 FORM OF SELECTED DEALER AGREEMENT 
 Ladies and Gentlemen: 
 KBS Capital Markets Group LLC, as the dealer manager (the
“Dealer Manager”) for KBS Real Estate Investment Trust III, Inc. (the “Company”), a Maryland corporation, invites you (the “Dealer”) to participate in the distribution of shares of common stock (the
“Shares”) of the Company subject to the following terms. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Dealer Manager Agreement between the Dealer Manager and the Company, dated October
    , 2010, in the form attached hereto as Exhibit A (the “Dealer Manager Agreement”). 
  

	I.	Dealer Manager Agreement 

By your acceptance of this Agreement, you will become one of the Dealers referred to in the Dealer Manager Agreement and will be entitled
and subject to the provisions contained in such Dealer Manager Agreement related to the Dealers, including the representations and warranties of the Company contained in Section 1 of the Dealer Manager Agreement and the indemnification
provisions contained in Section 6 of the Dealer Manager Agreement, including specifically the provisions of such Dealer Manager Agreement (Section 6.3) wherein each Dealer severally agrees to indemnify and hold harmless the Company, the Dealer
Manager and each their officers and directors (including any person named in the Registration Statement, with his consent, as about to become a director), each person who signed the Registration Statement and each person, if any, who controls the
Company and the Dealer Manager within the meaning of Section 15 the Securities Act of 1933, as amended (the “Securities Act”). The indemnification agreements contained in Section 6 of the Dealer Manager Agreement shall
survive the termination of this Agreement and the Dealer Manager Agreement. 
  

	II.	Submission of Orders 

Those persons who purchase Shares will be instructed by the Dealer to make their checks payable to “UMB Bank, N.A., as escrow agent
for KBS Real Estate Investment Trust III, Inc.” or, after the Minimum Offering has been achieved, to the Company, except with respect to Pennsylvania and Tennessee investors. Checks from Pennsylvania and Tennessee investors must be made payable
to “UMB Bank, N.A., as escrow agent for KBS Real Estate Investment Trust III, Inc.” until the Pennsylvania Minimum and Tennessee Minimum, respectively, have been achieved. The Dealer will return any check it receives not conforming to the
foregoing instructions directly to such subscriber not later than the end of the next business day following its receipt. Checks received by 

  
 A-1

 
the Dealer that conform to the foregoing instructions shall be transmitted for deposit pursuant to one of the following methods: 

Where, pursuant to the Dealer’s internal supervisory procedures, internal supervisory review is conducted at the same location at
which subscription documents and checks are received from subscribers, checks will be transmitted by the end of the next business day following receipt by the Dealer for deposit to an escrow agent for the Company or, after the Minimum Offering has
been achieved, to the Company or its agent, except for investments from Pennsylvania and Tennessee investors. The Dealer will transmit checks from Pennsylvania investors for deposit to the escrow agent for the Company or, after the Pennsylvania
Minimum has been achieved, to the Company or its agent. The Dealer will transmit checks from Tennessee investors for deposit to the escrow agent for the Company or, after the Tennessee Minimum has been achieved, to the Company or its agent.

 Where, pursuant to the Dealer’s internal supervisory procedures, final internal supervisory review is conducted at a
different location, checks will be transmitted by the end of the next business day following receipt by the Dealer to the office of the Dealer conducting such final internal supervisory review (the “Final Review Office”). The Final
Review Office will in turn by the end of the next business day following receipt by the Final Review Office transmit such checks for deposit to the escrow agent for the Company or, after the Minimum Offering has been achieved, to the Company or its
agent, except for investments from Pennsylvania and Tennessee investors. The Final Review Office will transmit checks from Pennsylvania investors for deposit to the escrow agent for the Company or, after the Pennsylvania Minimum has been achieved,
to the Company or its agent. The Final Review Office will transmit checks from Tennessee investors for deposit to the escrow agent for the Company or, after the Tennessee Minimum has been achieved, to the Company or its agent. 

 

	III.	Pricing 

 Except as
otherwise provided in the “Plan of Distribution” section of the Prospectus (as amended and supplemented), the Shares are to be sold at a per Share cash price as follows: 

 

					
	Distribution Channel	  	Primary
Offering
Shares	  	DRP Shares
	 Sales through a Dealer earning transaction-based compensation
	  	$ 10.00	  	$  9.50
	 Sales through all other distribution channels as described in the Prospectus
	  	$   9.35	  	$  9.50

  
 A-2

 Upon the terms set forth in the Prospectus, pursuant to the Company’s volume discount
program, Shares shall be sold at reduced prices in accordance with the following table, which may be amended and supplemented by the Prospectus: 
  

							
	 Dollar Volume Shares Purchased
	  	 Price Per Share to

Investor

	$                0	 	 to	  	$   999,999	  	$10.00
	$  1,000,000	 	 to	  	$1,999,999	  	$  9.90
	$  2,000,000	 	 to	  	$2,999,999	  	$  9.80
	$  3,000,000	 	 to	  	$3,999,999	  	$  9.65
	$  4,000,000	 	 to	  	$9,999,999	  	$  9.50
	$10,000,000	 	and above	  	$  9.35

The reduced selling price (and the applicable selling commission and dealer manager fee under the volume discount program) will apply to
the entire purchase. For example, a purchase of 250,000 shares in a single transaction would result in a purchase price of $2,450,000 ($9.80 per share). 
 In addition, as described in the Prospectus, the Dealer Manager may sell shares to the Dealer, its retirement plans, its representatives and the family members, IRAs and the qualified plans of its
representatives at a purchase price of $9.35 per share, reflecting that selling commissions in the amount of $0.65 per share will not be payable in consideration of the services rendered by the Dealer and its representatives in the Offering. For
purposes of this discount, a family member includes such person’s spouse, parent, child, sibling, mother- or father-in-law, son- or daughter-in law or brother- or sister-in-law. 

 

	IV.	Dealer’s Commissions 

Except for discounts described in or as otherwise provided in the “Plan of Distribution” section of the Prospectus (as amended
and supplemented), the Dealer’s selling commission applicable to the public offering price of the Shares sold by the Dealer, which it is authorized to sell hereunder, is as follows: 

 

					
	  	  	 Selling Commissions

	Distribution Channel	  	Primary
Offering
Shares	 	DRP
	 Sales through a Dealer earning transaction-based compensation
	  	6.5%	 	0.0%
	 Sales through all other distribution channels as discussed in the Prospectus
	  	0.0%	 	0.0%

  
 A-3

 The preceding commission (for the Dealer distribution channel) shall be adjusted for sales
under the volume discount program in accordance with the following table, which may be amended and supplemented by the Prospectus: 
  

					
	 Dollar Volume Shares Purchased
	 	 Sales
 Commissions
 (Based on $10.00

Price Per Share)
	 	 Dealer
 Manager Fee
 (Based on $10.00

Price Per Share)

	
$                0      to  
    $   999,999
	 	6.5%	 	3.0%
	 $  1,000,000      to      $1,999,999
	 	5.5%	 	3.0%
	 $  2,000,000      to      $2,999,999
	 	4.5%	 	3.0%
	 $  3,000,000      to      $3,999,999
	 	3.5%	 	2.5%
	 $  4,000,000      to      $9,999,999
	 	2.0%	 	2.5%
	 $10,000,000     and above
	 	1.0%	 	2.0%

 The reduced
selling commission and dealer manager fee will apply to the entire purchase. All commission rates and dealer manager fees are calculated assuming a price per share of $10.00. For example, a purchase of 250,000 shares in a single transaction would
result in selling commissions of $112,500 and dealer manager fees of $75,000. 
 All selling commissions shall be based on
Shares sold by Dealer and accepted and confirmed by the Company, which commission will be paid by the Dealer Manager. For these purposes, a “sale of Shares” shall occur if and only if a transaction has closed with a subscriber for Shares
pursuant to all applicable offering and subscription documents, payment for the Shares has been received in full in the manner provided in Section II hereof, the Company has accepted the subscription agreement of such subscriber and the Company has
thereafter distributed the commission to the Dealer Manager in connection with such transaction. The Dealer affirms that the Dealer Manager’s liability for commissions payable is limited solely to the proceeds of commissions receivable from the
Company and the Dealer hereby waives any and all rights to receive payment of commissions due until such time as the Dealer Manager is in receipt of the commission from the Company. 

In addition, upon the terms set forth herein or in the Prospectus (as amended and supplemented), the Dealer Manager may agree to reallow
to any Dealer a portion of its dealer manager fee pursuant to a separate marketing fee agreement. For volume discount sales of $3,000,000 or more, the dealer manager fee is reduced as set forth above. The amount of the dealer manager fee reallowed
to a Dealer in that instance will be negotiated on a transaction by transaction basis. The Dealer Manager or, in certain cases at the option of the Company, the Company, will pay or reimburse bona fide invoiced due diligence expenses of Dealer
unless such payment would cause the aggregate of such reimbursements to Dealer and other broker-dealers, together with all other organization and offering expenses, to exceed 15% of the Company’s gross proceeds from the Offering. 

The parties hereby agree that the foregoing commission is not in excess of the usual and customary distributors’ or sellers’
commission received in the sale of securities similar to the Shares, that Dealer’s interest in the Offering is limited to such commission 

  
 A-4

 
from the Dealer Manager and Dealer’s indemnity referred to in Section 6 of the Dealer Manager Agreement and that the Company is not liable or responsible for the direct payment of such
commission to the Dealer. 
  

	V.	Payment 

 Payment of
selling commissions or any reallowance of a portion of the dealer manager fee will be made by the Dealer Manager (or by the Company as provided in the Dealer Manager Agreement) to the Dealer within 30 days of the receipt by the Dealer Manager of the
gross commission payments from the Company. Dealer acknowledges that, if the Company pays selling commissions to the Dealer Manager, the Company is relieved of any obligation for selling commissions to the Dealer. The Company may rely on and use the
preceding acknowledgment as a defense against any claim by the Dealer for selling commissions the Company pays to Dealer Manager but that Dealer Manager fails to remit to the Dealer. 

 

	VI.	Right to Reject Orders or Cancel Sales 

 All orders, whether initial or additional, are subject to acceptance by and shall only become effective upon confirmation by the Company. The Dealer agrees that the Company, in its sole and absolute
discretion, may accept or reject any subscription, in whole or in part, for any reason whatsoever, and no commission will be paid to the Dealer with respect to the portion of any subscription that is rejected. Orders not accompanied by a
Subscription Agreement with the signature page and the required check in payment for the Shares may be rejected. Issuance and delivery of the Shares will be made only after actual receipt of payment therefor. If any check is not paid upon
presentment, or if the Company is not in actual receipt of clearinghouse funds or cash, certified or cashier’s check or the equivalent in payment for the Shares, the Company reserves the right to cancel the sale without notice. In the event an
order is rejected, canceled or rescinded for any reason, the Dealer agrees to return to the Dealer Manager any commission theretofore paid with respect to such order within 30 days thereafter and, failing to do so, the Dealer Manager shall have the
right to offset amounts owed against future commissions due and otherwise payable to the Dealer. 
  

	VII.	Covenants of the Dealer 

Dealer covenants and agrees with the Dealer Manager and the Company that: 

 

	 	7.1	Dealer will use its best efforts to sell the Shares for cash on the terms and conditions set forth in this Agreement and the Prospectus as amended and supplemented.

  

	 	7.2	 In connection with the Dealer’s participation in the offer and sale of Shares (including, without limitation, all initial and additional
subscriptions for Shares and any resales and transfers of Shares), the Dealer will comply with all requirements and obligations imposed upon it by (a) the Securities Act, the Securities Exchange Act of 1934, as

  
 A-5

	 	 
amended (the “Exchange Act”), and the rules and regulations of the SEC promulgated under both such acts; (b) all applicable state securities laws and regulations as from
time to time in effect; (c) the applicable rules of FINRA, including, but not in any way limited to, Rule 2730, Rule 2740, Rule 2420, Rule 2440 and Rule 2750 of the NASD Conduct Rules and FINRA Rule 2310; (d) all applicable rules and
regulations relating to the suitability of investors, including, without limitation, the provisions of Articles III.C. and III.E of the Statement of Policy regarding Real Estate Investment Trusts of the North American Securities Administrators
Association, Inc. (the “NASAA Guidelines”); (e) any other state and federal laws and regulations applicable to the Offering, the sale of Shares or the activities of the Dealer pursuant to this Agreement, including without
limitation the privacy standards and requirements of state and federal laws, including the Gramm-Leach-Bliley Act of 1999, and the laws governing money laundering abatement and anti-terrorist financing efforts, including the applicable rules of the
SEC and FINRA, the Bank Secrecy Act, as amended, the USA Patriot Act of 2001, and regulations administered by the Office of Foreign Asset Control at the Department of the Treasury; and (f) this Agreement and the Prospectus as amended and
supplemented. 

  

	 	7.3	The Dealer will not offer Shares in any jurisdiction unless and until (a) the Dealer has been advised in writing by the Company or the Dealer Manager that the
Shares are either registered in accordance with, or exempt from, the securities laws of such jurisdiction and (b) the Dealer has all required licenses and registrations to offer shares in that jurisdiction. 

 

	 	7.4	The Dealer will offer Shares (both at the time of an initial subscription and at the time of any additional subscription, including initial enrollments and increased
participations in the DRP) only to persons who meet the financial qualifications and suitability standards set forth in the Prospectus as amended or supplemented or in any suitability letter or memorandum sent to the Dealer by the Company or the
Dealer Manager. Nothing contained in this section shall be construed to relieve the Dealer of the Dealer’s suitability obligations under Rule 2310 of the NASD Conduct Rules or FINRA Rule 2310. Dealer shall not purchase any Shares for a
discretionary account without obtaining the prior written approval of Dealer’s customer and his or her signature on a subscription agreement. 

  

	 	7.5	 The Dealer agrees to comply with the record-keeping requirements imposed by (a) federal and state securities laws and the rules and regulations
thereunder, (b) the applicable rules of FINRA and (c) the NASAA Guidelines, including the requirement to maintain records (the “Suitability Records”) of the information used to determine that an investment in Shares is
suitable and appropriate for each subscriber for a period of six years from the date of the sale of the Shares. The Dealer further agrees to make the Suitability Records available to the Dealer

  
 A-6

	 	 
Manager and the Company upon request and to make them available to representatives of the SEC and FINRA and applicable state securities administrators upon the Dealer’s receipt of a subpoena
or other appropriate document request from such agency. 

  

	 	7.6	The Dealer will provide the Dealer Manager with such information relating to the offer and sale of the Shares by it as the Dealer Manager may from time to time
reasonably request or as may be requested to enable the Dealer Manager or the Company, as the case may be, to prepare such reports of sale as may be required to be filed under applicable federal or state securities laws and the rules and regulations
thereunder. 

  

	 	7.7	The Dealer agrees to be bound by the terms of the Escrow Agreement dated September 17, 2010 among UMB Bank, N.A., as escrow agent, the Dealer Manager and the
Company, copies of which are attached hereto as Exhibit B and the Dealer further agrees that it will not represent or imply that UMB Bank, N.A., as the escrow agent identified in the Prospectus, has investigated the desirability or
advisability of an investment in the Company or has approved, endorsed or passed upon the merits of the Shares or of the Company, nor will the Dealer use the name of said escrow agent in any manner whatsoever in connection with the offer or sale of
the Shares other than by acknowledgment that it has agreed to serve as escrow agent. 

  

	VIII.	Prospectus and Sales Literature 

 Dealer is not authorized or permitted to give, and will not give, any information or make any representation (written or oral) concerning the Shares except as set forth in the Prospectus as amended and
supplemented or in the Authorized Sales Materials. The Dealer Manager will supply Dealer with reasonable quantities of the Prospectus, including amendments of and supplements to the Prospectus, and any Authorized Sales Materials, for delivery to
investors, and Dealer will deliver a copy of the Prospectus, including any amendments and supplements thereto, as required by the Securities Act, the Exchange Act and the rules and regulations promulgated under both. The Dealer agrees that
(a) it will deliver a copy of the Prospectus as amended and supplemented to each investor to whom an offer is made prior to or simultaneously with the first solicitation of an offer to sell the Shares to an investor and (b) it will not
send or give any Authorized Sales Materials to an investor unless the Authorized Sales Materials are accompanied by or preceded by the Prospectus as amended and supplemented. 
 Except for the Authorized Sales Materials, the Company has not authorized the use of any supplemental literature or sales materials in connection with the Offering and the Dealer agrees not to use any
material unless it has been authorized by the Company and provided to the Dealer by the Dealer Manager. Dealer agrees that it will not show or give to any investor or prospective investor or reproduce any material or writing that is supplied to it
by the Dealer Manager and marked “broker-dealer use only” or otherwise bearing a legend denoting that it is not to be used in connection with the sale of Shares to 

  
 A-7

 
members of the public. Dealer agrees that it will not show or give to any investor or prospective investor in a particular jurisdiction any material or writing that is supplied to it by the
Dealer Manager if such material bears a legend denoting that it is not to be used in connection with the sale of Shares to members of the public in such jurisdiction. Dealer agrees that it will not use in connection with the offer or sale of Shares
any material or writing that relates to another company supplied to it by the Company or the Dealer Manager bearing a legend that states that such material may not be used in connection with the offer or sale of any securities of the Company.

 Dealer agrees to furnish a copy of the Prospectus (as amended and supplemented) required for compliance with the provisions
of federal and state securities laws and the rules and regulations thereunder, including Rule 15c2-8 under Exchange Act. Regardless of the termination of this Agreement, Dealer will deliver a Prospectus (as amended and supplemented) in transactions
in the Shares for a period of 90 days from the effective date of the Registration Statement or such other period as may be required by the Exchange Act or the rules and regulations thereunder. 

 

	IX.	License and Association Membership 

 Dealer represents and warrants to the Company and the Dealer Manager that it is a properly registered or licensed broker-dealer, duly authorized to offer and sell Shares under federal securities laws and
regulations and the securities laws and regulations of all states where it offers or sells Shares and that it is a member of FINRA in good standing. This Agreement shall automatically terminate if the Dealer ceases to be a member of FINRA in good
standing or is subject to a FINRA suspension or if the Dealer’s registration or license under the Exchange Act or any state securities laws or regulations is terminated or suspended; the Dealer agrees to notify the Dealer Manager immediately if
any of these events occur. 
  

	X.	Anti-Money Laundering Compliance Programs 

 Dealer’s acceptance of this Agreement constitutes a representation to the Company and the Dealer Manager that the Dealer has established and implemented an anti-money laundering and customer
identification compliance program (“AML Program”) in accordance with applicable laws and regulations, including federal and state securities laws, applicable rules of FINRA, and the Bank Secrecy Act, Title 31 U.S.C. Sections
5311-5355, as amended by the USA Patriot Act of 2001, and related regulations (31 C.F.R. Part 103), and will continue to maintain its AML Program consistent with applicable laws and regulations during the term of this Agreement. 

In accordance with these applicable laws and regulations and its AML Program, Dealer agrees to verify the identity of its new customers;
to maintain customer records; to check the names of new customers against government watch lists, including the Office of Foreign Asset Control’s (OFAC) list of Specially Designated Nationals and Blocked Persons. Additionally, Dealer will
monitor account activity to identify patterns of unusual size or volume, geographic factors and any other “red flags” described in the USA Patriot Act as potential signals of money laundering or terrorist financing. Dealer

  
 A-8

 
will submit to the Financial Crimes Enforcement Network any required suspicious activity reports about such activity and further will disclose such activity to applicable federal and state law
enforcement when required by law. Upon request by the Dealer Manager at any time, the Dealer hereby agrees to furnish (a) a copy of its AML Program to the Dealer Manager for review, and (b) a copy of the findings and any remedial actions
taken in connection with Dealer’s most recent independent testing of its AML Program. 
  

	XI.	Effectiveness, Termination and Amendment 

 This Agreement shall become effective upon the execution hereof by the Dealer and the receipt of this executed Agreement by the Dealer Manager. Dealer will immediately suspend or terminate its offer and
sale of Shares upon the request of the Company or the Dealer Manager at any time and will resume its offer and sale of Shares hereunder upon subsequent request of the Company or the Dealer Manager. In addition to termination pursuant to Section IX,
any party may terminate this Agreement by written notice, which termination shall be effective 48 hours after such notice is given. Upon the sale of all of the Shares or the termination of the Dealer Manager Agreement, this Agreement shall terminate
without obligation on the part of the Dealer or the Dealer Manager, except as set forth in this Agreement. The indemnification agreements contained in Section 6 of the Dealer Manager Agreement shall survive the termination of this Agreement and
the Dealer Manager Agreement, and the respective agreements and obligations of the Dealer Manager and the Dealer set forth in Sections IV, V, VI, 7.2, 7.5, 7.6, VIII and XI through XXI of this Agreement shall remain operative and in full force and
effect regardless of the termination of this Agreement. 
 This Agreement may be amended at any time by the Dealer Manager by
written notice to the Dealer. Any such amendment shall be deemed accepted by the Dealer upon the Dealer placing an order for the sale of Shares after it has received such notice. 

 

	XII.	Privacy Laws 

 The Dealer
Manager and Dealer (each referred to individually in this section as a “party”) agree as follows: 
  

	 	12.1	Each party agrees to abide by and comply in all respects with (a) the privacy standards and requirements of the Gramm-Leach-Bliley Act of 1999 (“GLBA”)
and applicable regulations promulgated thereunder, (b) the privacy standards and requirements of any other applicable federal or state law, including the Fair Credit Reporting Act (“FCRA”) and (c) its own internal privacy
policies and procedures, each as may be amended from time to time. 

  

	 	12.2	Dealer shall not disclose nonpublic personal information (as defined under the GLBA) of all customers who have opted out of such disclosures, except to service
providers (when necessary and as permitted under the GLBA) or as otherwise required by applicable law; 

  
 A-9

	 	12.3	Except as expressly permitted under the FCRA, Dealer shall not disclose any information that would be considered a “consumer report” under the FCRA; and

  

	 	12.4	Dealer shall be responsible for determining which customers have opted out of the disclosure of nonpublic personal information by periodically reviewing and, if
necessary, retrieving a list of such customers (the “List”) to identify customers that have exercised their opt-out rights. In the event either party expects to use or disclose nonpublic personal information of any customer for
purposes other than servicing the customer, or as otherwise required by applicable law, that party must first consult the List to determine whether the affected customer has exercised his or her opt-out rights. Each party understands that it is
prohibited from using or disclosing any nonpublic personal information of any customer that is identified on the List as having opted out of such disclosures. 

 

	XIII.	Customer Complaints 

Each party agrees to promptly provide to the other party copies of any written or otherwise documented complaints from customers of the
Dealer received by such party relating in any way to the Offering (including, but not limited to, the manner in which the Shares are offered by the Dealer). 
  

	XIV.	Notice 

 All notices to
the Dealer Manager shall be in writing addressed to the Dealer Manager at the address set forth below. All notices to Dealer shall be in writing addressed to the Dealer at the address specified by the Dealer at the end of this Agreement. Notices
addressed to the intended recipient as described above will be duly given (a) when personally delivered or by commercial messenger, (b) one business day following deposit with a recognized overnight courier service, provided such deposit
occurs prior to the deadline imposed by such service for overnight delivery; or (c) when transmitted to Dealer, if sent by facsimile copy (provided confirmation of receipt is received by sender) or electronic transmission (e-mail) and in each
case such notice is also followed contemporaneously by the method provided under either (a) or (b) above. 
 To the Dealer Manager:

 KBS Capital Markets Group LLC 
 660 Newport Center Drive, Suite 1200 
 Newport Beach, California 92660 

 

	XV.	Confirmation 

 The Dealer
Manager hereby acknowledges that the Dealer Manager has assumed the duty to confirm on behalf of the Dealers all orders for purchases of Shares accepted by the Company. Such confirmations will comply with the rules of the SEC and FINRA

  
 A-10

 
and will comply with the applicable laws of such other jurisdictions to the extent that the Dealer Manager is advised of such laws in writing by the Dealer. 

 

	XVI.	Entire Agreement 

 This
Agreement and the exhibits hereto are the entire agreement of the parties and supersede all prior agreements, if any, relating to the subject matter hereof between the parties hereto. 

 

	XVII.	Successors and Assigns 

No party shall assign this Agreement or any right, interest or benefit under this Agreement without the prior written consent of the
other party. This Agreement shall be binding upon the Dealer Manager and the Dealer and their respective successors and permitted assigns. 
  

	XVIII.	 Arbitration, Attorney’s Fees, Jury Trial and Applicable Law 

 In the event of a dispute concerning any provision of this Agreement (including any provisions of the Dealer Manager Agreement incorporated into this Agreement), either party may require the dispute to be
submitted to binding arbitration, conducted on a confidential basis, under the then current commercial arbitration rules of FINRA or the American Arbitration Association (at the discretion of the party requesting arbitration) in accordance with the
terms of this Agreement (including the governing law provisions of this section) and pursuant to the Federal Arbitration Act (9 U.S.C. §§ 1 – 16). The parties will request that the arbitrator or arbitration panel
(“Arbitrator”) issue written findings of fact and conclusions of law. The Arbitrator shall not be empowered to make any award or render any judgment for punitive damages, and the Arbitrator shall be required to follow applicable law in
construing this Agreement, making awards, and rendering judgments. The decision of the arbitration panel shall be final and binding, and judgment upon any arbitration award may be entered by any court having jurisdiction. All arbitration hearings
will be held at the Los Angeles FINRA District Office or at another mutually agreed upon site. The parties may agree on a single arbitrator, or, if the parties cannot so agree, each party will have the right to choose one arbitrator, and the
selected arbitrators will choose a third arbitrator. Each arbitrator must have experience and education that qualify him or her to competently address the specific issues to be designated for arbitration. Notwithstanding the preceding, no party will
be prevented from immediately seeking provisional remedies in courts of competent jurisdiction, including but not limited to, temporary restraining orders and preliminary injunctions, but such remedies will not be sought as a means to avoid or stay
arbitration. Except as provided otherwise in Section 6 of the Dealer Manager Agreement, in any action or arbitration to enforce the provisions of this Agreement or to secure damages for its breach, the prevailing party shall recover its costs
and reasonable attorney’s fees. Each party to this Agreement hereby waives a trial by jury in any legal action or proceeding relating to this Agreement. This Agreement shall be construed under the laws of the State of California; provided,
however, that the governing law for causes of action for 

  
 A-11

 
violations of federal or state securities law shall be governed by the applicable federal or state securities law. 

 

	XIX.	Severability 

 The
invalidity or unenforceability of any provision of this Agreement shall not affect the other provisions hereof, and this Agreement shall be construed in all respects as if such invalid or unenforceable provision was omitted. 

 

	XX.	Counterparts 

 This
Agreement may be executed in any number of counterparts. Each counterpart, when executed and delivered, shall be an original contract, but all counterparts, when taken together, shall constitute one and the same agreement. 

 

	XXI.	No Partnership 

 Nothing
in this Agreement shall be construed or interpreted to constitute the Dealer as an employee, agent or representative of, or in association with or in partnership with, the Dealer Manager, the Company or the other Dealers; instead, this Agreement
shall only constitute the Dealer as a dealer authorized by the Dealer Manager to sell the Shares according to the terms set forth in the Registration Statement and the Prospectus as amended and supplemented and in this Agreement. 

[signature page follows] 

  
 A-12

  

									
		 		  		 	THE DEALER MANAGER:
			
	Attest:	  		 	KBS CAPITAL MARKETS GROUP LLC
					
	By:	 	  
	  		 	By:	 	  

		 	Name	  		 		 	Name
					
		 	  
	  		 		 	  

		 	Title	  		 		 	Title

 We have read the foregoing
Agreement and we hereby accept and agree to the terms and conditions set forth therein. We hereby represent that the list below of jurisdictions in which we are registered or licensed as a broker or dealer and are fully authorized to sell securities
is true and correct, and we agree to advise you of any change in such list during the term of this Agreement. 
  

	1.	Identity of Dealer: 

  

			
	Name:	 	  

			
		
	Type of entity:	 	  

			
		 	                        (corporation, partnership or
proprietorship)
		
	Organized in the State of:	 	  

		 	(State)                          
  

			
		
	Licensed as broker-dealer in the following States:	 	  

	
	  

			
		
	Tax I.D. #:	 	  

  
 A-13

  

	2.	Person to receive notice pursuant to Section XIV: 

  

			
	Name:	 	  

			
		
	Company:	 	  

			
		
	Address:	 	  

			
		
	City, State and Zip Code:	 	  

			
		
	Telephone No.:	 	
(        )

			
		
	Telefax No.:	 	
(        )

			
		
	E-mail Address:	 	  

 
  

			
	AGREED TO AND ACCEPTED BY THE DEALER:	 	
	  
  
	 	
	            (Dealer’s Firm Name)	 	
		
	By:                             
                                         
               	 	
	            Authorized Signature	 	
		
	Title:                            
                                         
            	 	

  
 A-14

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