Document:

Form of Award Agreement for Restricted Stock Awards

 Exhibit 10.3 
 DIAMOND HILL INVESTMENT GROUP, INC. 
 2011 EQUITY AND CASH INCENTIVE PLAN

 RESTRICTED STOCK AWARD AGREEMENT 
 Diamond Hill Investment Group, Inc. (the “Company”) hereby grants the undersigned Participant an award of Shares of Restricted Stock, subject to the terms and conditions described in the Diamond
Hill Investment Group, Inc. 2011 Equity and Cash Incentive Plan (the “Plan”) and this Restricted Stock Award Agreement (this “Award Agreement”). 
  

	1.	Name of Participant: 

  

	2.	Grant Date:
                                        ,
20    (the “Grant Date”) 

  

	3.	Number of Shares of Restricted Stock: 

  

	4.	Vesting: Except as provided in Section 5, provided that the Participant remains an employee of the Company on the relevant date, the Restricted Stock will
vest as follows: [describe]. 

  

	5.	Accelerated Vesting. Notwithstanding the foregoing, the vesting of the Restricted Stock will accelerate if: [describe]. 

 

	6.	Transferability: Until the Shares of Restricted Stock become vested as described in Sections 4 or 5, the Shares of Restricted Stock may not be sold, transferred,
pledged, assigned or otherwise alienated or hypothecated. 

  

	7.	Delivery of Shares: If the applicable terms and conditions of this Award Agreement are satisfied, the Shares of Restricted Stock will be released from any
transfer restrictions or delivered to the Participant as soon as administratively feasible after all applicable restrictions have lapsed. Any fractional Shares of Restricted Stock will be settled in cash. 

 

	8.	Other Terms and Conditions: 

  

	 	(a)	Rights Before Vesting. Before the Shares of Restricted Stock vest, the Participant (i) may exercise full voting rights associated with the Shares of
Restricted Stock; and (ii) will be entitled to receive all dividends and other distributions paid with respect to the Shares of Restricted Stock, provided that any dividends or other distributions paid in Shares will be subject to the same
restrictions, terms and conditions as the Shares of Restricted Stock. 

  

	 	(b)	Beneficiary Designation. The Participant may name a beneficiary or beneficiaries to receive Shares of Restricted Stock that are delivered after the
Participant’s death by completing a “Beneficiary Designation Form” in a form provided by the Company. The Beneficiary Designation Form does not need to be completed upon execution of this Award Agreement and is not required to be
completed as a condition of receiving the Shares of Restricted Stock. However, if the Participant dies without completing a Beneficiary Designation Form or if the Participant does not complete the form correctly, the Participant’s beneficiary
under this Award Agreement will be the Participant’s surviving spouse or, if the Participant does not have a surviving spouse, the Participant’s estate. 

	 	(c)	Transferring the Award Agreement. Except to the extent that the Committee permits otherwise, this Award Agreement may not be sold, transferred, pledged, assigned
or otherwise alienated or hypothecated, except by will or the laws of descent and distribution. However, as described in Section 8(b), the Participant may designate a beneficiary to receive any Shares of Restricted Stock that are unsettled in
the event of the Participant’s death. 

  

	 	(d)	Tax Withholding. The Company or an Affiliate, as applicable, will have the power and right to deduct, withhold or collect any amount required by law or
regulation to be withheld with respect to any taxable event arising with respect to the Shares of Restricted Stock. To the extent permitted by the Committee, in its sole discretion, this amount may be (i) withheld from other amounts due to the
Participant, (ii) withheld from any Shares transferred in connection with the settlement of the Restricted Stock, (iii) withheld from the vested portion of the Restricted Stock (including Shares transferable thereunder), whether or not
being settled at the time the taxable event arises, or (iv) collected directly from the Participant. Subject to the approval of the Committee, the Participant may elect to satisfy the withholding requirement, in whole or in part, by having the
Company or an Affiliate, as applicable, withhold Shares having a Fair Market Value on the date the tax is to be determined equal to the minimum statutory total tax that could be imposed on the transaction; provided that such Shares would otherwise
be distributable to the Participant at the time of the withholding. All such elections will be irrevocable and made in writing and will be subject to any terms and conditions that the Committee, in its sole discretion, deems appropriate.

  

	 	(e)	Governing Law. This Award Agreement will be construed in accordance with, and governed by, the laws (other than laws governing conflicts of laws) of the State of
Ohio. 

  

	 	(f)	Entire Agreement. This Award Agreement, together with the applicable provisions of the Employment Agreement, constitute the entire agreement between the Company
and the Participant regarding the subject matter of this Award Agreement, and this Award Agreement and the applicable provisions of the Employment Agreement supersede all prior and contemporaneous agreements between the parties hereto in connection
with the subject matter of this Award Agreement. All representations of any type relied upon by the Participant and the Company in making this Award Agreement are specifically set forth herein, and the Participant and the Company each acknowledge
that they have relied on no other representation in entering into this Award Agreement. No change, termination or attempted waiver of any of the provisions of this Award Agreement will be binding upon any party hereto unless contained in a writing
signed by the party to be charged. 

  
 -2-

	 	(g)	Restricted Stock Subject to the Plan. The Shares of Restricted Stock are subject to the terms and conditions described in this Award Agreement and the
Plan, which is incorporated by reference into and made a part of this Award Agreement. In the event of a conflict between the terms of the Plan and the terms of this Award Agreement, the terms of the Plan will govern. The Committee has the sole
responsibility for interpreting the Plan and this Award Agreement, and its determination of the meaning of any provision in the Plan or this Award Agreement will be binding on the Participant. Capitalized terms that are not defined in this Award
Agreement have the same meaning as in the Plan. 

  

	 	(h)	Signature in Counterparts. This Award Agreement may be signed in counterparts, each of which will be deemed an original, but all of which will constitute one and
the same instrument. 

  

	 	(i)	Section 83(b) Election. The Participant may file an election pursuant to Section 83(b) of the Code to be taxed currently on the Fair Market Value of
the Shares of Restricted Stock (less any purchase price paid for the Restricted Stock). The election will be made on a form provided by the Company and must be filed with the Internal Revenue Service no later than 30 days after the Grant Date. The
Participant must seek the advice of the Participant’s own tax advisors as to the advisability of making such an election, the potential consequences of making such an election, the requirements for making such an election, and the other tax
consequences of the Restricted Stock under federal, state, and any other laws, rules and regulations that may be applicable. The Company and its Related Entities and agents have not and are not providing any tax advice to the Participant.

 ***** 
  

									
	[PARTICIPANT]	 		 	DIAMOND HILL INVESTMENT GROUP, INC.
				
	  
	 		 	By:	 	  

	Signature	 		 	  
 Title:
	 	  

	Date:	 	  
	 		 		 	
		 		 		 	Date:	 	  

  
 -3-Fifth Amended and Restated Advisory Agreement

 Exhibit 10.1 
 Fifth Amended and Restated 
 Advisory Agreement 

between 

Phillips Edison – ARC Shopping Center REIT Inc. 
 and 
 American Realty Capital II Advisors, LLC 

March 28, 2011 

 Table of Contents 

 

					
	 	 	 	  	 Page

			
	Article 1	 	– Definitions	  	1
	Article 2	 	– Appointment	  	9
	Article 3	 	– Duties Of The Advisor	  	9
	3.1	 	Organizational and Offering Services	  	10
	3.2	 	Acquisition Services	  	10
	3.3	 	Asset Management Services	  	11
	3.4	 	Stockholder Services	  	14
	3.5	 	Other Services	  	14
	Article 4	 	– Authority Of Advisor	  	14
	4.1	 	General	  	14
	4.2	 	Powers of the Advisor	  	15
	4.3	 	Approval by the Board	  	15
	4.4	 	Modification or Revocation of Authority of Advisor	  	15
	Article 5	 	– Bank Accounts	  	15
	Article 6	 	– Records And Financial Statements	  	15
	Article 7	 	– Limitation On Activities	  	16
	Article 8	 	– Fees	  	16
	8.1	 	Acquisition Fees	  	16
	8.2	 	Asset Management Fee	  	17
	8.3	 	Disposition Fees	  	18
	8.4	 	Financing Fee	  	18
	8.5	 	Subordinated Share of Cash Flows	  	18
	8.6	 	Subordinated Incentive Fee	  	19
	8.7	 	Other Services	  	19
	8.8	 	Changes to Fee Structure	  	19
	8.9	 	Internalization	  	20
	           8.10 Limitation on Acquisition Fees, Acquisition Expenses and Financing Fees	  	20
	Article 9	 	– Expenses	  	20
	9.1	 	General	  	20
	9.2	 	Timing of and Limitations on Reimbursements	  	23
	Article 10	 	– Voting Agreement	  	24
	10.1	 	Election of Directors	  	24
	10.2	 	Other Voting of Shares	  	24
	Article 11	 	– Relationship Of Advisor And Company; Other Activities Of The Advisor	  	25
	11.1	 	Relationship	  	25
	11.2	 	Time Commitment	  	25
	11.3	 	Investment Opportunities and Allocation	  	25
	Article 12	 	– The Phillips Edison and ARC Names	  	26
	12.1	 	The American Realty Capital and ARC Names	  	26
	12.2	 	The Phillips Edison and PECO Names	  	27
	Article 13	 	– Term And Termination of the Agreement and Sub-advisory Agreement	  	28

  
 i 

					
	13.1	 	 Term
	  	28
	13.2	 	 Termination by Either Party
	  	28
	13.3	 	 Payments on Termination and Survival of Certain Rights and Obligations
	  	28
	Article 14	 	 – Assignment
	  	30
	14.1	 	 Assignment of Agreement
	  	30
	14.2	 	 Assignment of Payments
	  	30
	Article 15	 	 – Indemnification And Limitation Of Liability
	  	30
	15.1	 	 Indemnification
	  	30
	15.2	 	 Limitation on Indemnification
	  	31
	15.3	 	 Limitation on Payment of Expenses
	  	31
	Article 16	 	 – Miscellaneous
	  	32
	16.1	 	 Notices
	  	32
	16.2	 	 Modification
	  	33
	16.3	 	 Severability
	  	33
	16.4	 	 Construction
	  	33
	16.5	 	 Entire Agreement
	  	33
	16.6	 	 Waiver
	  	34
	16.7	 	 Gender
	  	34
	16.8	 	 Titles Not to Affect Interpretation
	  	34
	16.9	 	 Third Party Beneficiary
	  	34
	         16.10 Counterparts	  	34
	          16.10 Restricted Stock
	  	34

  
 ii 

 Fifth Amended and Restated Advisory Agreement 

This Fifth Amended and Restated Advisory Agreement, dated as of March 28, 2011 (this “Agreement”), is between
Phillips Edison – ARC Shopping Center REIT Inc., a Maryland corporation (the “Company”), and American Realty Capital II Advisors, LLC, a Delaware limited liability company (the “Advisor”). 

W I T N E S S E T H 
 WHEREAS, the parties entered into the Advisory Agreement on January 11, 2010; 

WHEREAS, the parties entered into the Amended and Restated Advisory Agreement on March 1, 2010; 

WHEREAS, the parties entered into the Second Amended and Restated Advisory Agreement on April 9, 2010; 

WHEREAS, the parties entered into the Third Amended and Restated Advisory Agreement on July 1, 2010; 

WHEREAS, the parties entered into the Fourth Amended and Restated Advisory Agreement on September 17, 2010 (the “Amended
Agreement”); 
 WHEREAS, the parties have agreed to make certain amendments and desire to amend and restate the Amended
Agreement; 
 WHEREAS, the Company desires to avail itself of the knowledge, experience, sources of information, advice,
assistance and certain facilities available to the Advisor and to have the Advisor undertake the duties and responsibilities hereinafter set forth, on behalf of, and subject to the supervision of, the Board of Directors of the Company, all as
provided herein; and 
 WHEREAS, the Advisor is willing to undertake to render such services, subject to the supervision of the
Board of Directors of the Company, on the terms and subject to the conditions hereinafter set forth. 
 NOW, THEREFORE, in
consideration of the foregoing and of the mutual covenants and agreements contained herein, the parties hereto agree that the Amended Agreement hereby is amended and restated to read in its entirety as follows: 

Article 1 

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

  
 1 

 “Acquisition Expenses” means any and all expenses, excluding the
Acquisition Fees, incurred by the Company, the Advisor or any Affiliate of either in connection with the consideration, investigation, selection, evaluation, acquisition or development of any Property, Loan or other Permitted Investment, whether or
not acquired or originated, as applicable, including legal fees and expenses, travel and communications expenses, brokerage fees, costs of appraisals, nonrefundable option payments on Properties, Loans or other Permitted Investments not acquired,
accounting fees and expenses, title insurance premiums and the costs of performing due diligence. 
 “Acquisition
Fees” means (i) the fees payable to the Advisor pursuant to Section 8.1, and (ii) all other fees and commissions, excluding Acquisition Expenses, paid by any Person to any Person in connection with making or investing
in any Property, Loan or other Permitted Investment or the purchase, development or construction of any Property by the Company. Included in clause (ii) above shall be any real estate commission, selection fee, Development Fee,
Construction Fee, nonrecurring management fee, loan fees or points or any fee of a similar nature, however designated. Excluded in clause (ii) above shall be Development Fees and Construction Fees paid to Persons not Affiliated with the
Advisor or Sub-advisor in connection with the actual development and construction of a Property. 
 “Advisor”
has the meaning set forth at the head of this Agreement. 
 “Affiliate” means, with respect to any Person, any
of the following: (i) any other Person directly or indirectly controlling, controlled by, or under common control with such Person; (ii) any other Person directly or indirectly owning, controlling, or holding with the power to vote 10% or
more of the outstanding voting securities of such Person; (iii) any legal entity for which such Person acts as an executive officer, director, trustee, or general partner; (iv) any other Person 10% or more of whose outstanding voting
securities are directly or indirectly owned, controlled, or held, with power to vote, by such Person; and (v) any executive officer, director, trustee, or general partner of such Person. An entity shall not be deemed to control or be under
common control with an Advisor- or Sub-advisor-sponsored program unless (A) the entity owns 10% or more of the voting equity interests of such program, or (B) a majority of the board of directors (or equivalent governing body) of such
program is composed of Affiliates of the entity. The term “Affiliated” shall have a meaning correlative thereto. For the avoidance of doubt, none of the Company, the Sub-advisor, any subsidiary of the Company, any subsidiary of the
Sub-advisor and any other Person controlled by, controlling or under common control with Phillips Edison & Company shall be an Affiliate of the Advisor. 
 “Appraised Value” means the value according to an appraisal made by an Independent Appraiser. 
 “Articles of Incorporation” means the Articles of Incorporation of the Company under Title 2 of the Corporations and Associations Article of the Annotated Code of Maryland, as amended
from time to time. 
 “Asset Management Fee” shall have the meaning set forth in Section 8.2.

  
 2 

 “Average Invested Assets” means, for a specified period, the average of the
aggregate book value of the assets of the Company invested, directly or indirectly, in Properties, Loans and other Permitted Investments secured by real estate before reserves for depreciation or bad debts or other similar non-cash reserves,
computed by taking the average of such values at the end of each month during such specified period. 
 “Board of
Directors” or “Board” means the persons holding such office, as of any particular time, under the Articles of Incorporation of the Company, whether they be the Directors named therein or additional or successor Directors.

 “Bylaws” means the bylaws of the Company, as amended from time to time. 

“Cash from Financings” means the net cash proceeds realized by the Company from the financing of Properties, Loans or
other Permitted Investments or from the refinancing of any Company indebtedness (after deduction of all expenses incurred in connection therewith). 
 “Cash from Sales and Settlements” means the net cash proceeds realized by the Company: (i) from the sale, exchange or other disposition of any of its assets or any portion thereof
after deduction of all expenses incurred in connection therewith; (ii) from the prepayment, maturity, workout or other settlement of any Loan or Permitted Investment or portion thereof after deduction of all expenses incurred in connection
therewith; and (iii) from regular principal payments on any Loan (or to the extent applicable, any Permitted Investment). In the case of a transaction described in clause (i)(C) of the definition of “Sale” and clause
(i)(B) of the definition of “Settlement,” Cash from Sales and Settlements means the proceeds of any such transaction actually distributed to the Company from the Joint Venture or partnership. Cash from Sales and Settlements shall not
include Cash from Financings. 
 “Cash from Sales, Settlements and Financings” means the total sum of Cash from
Sales and Settlements and Cash from Financings. 
 “Code” means the Internal Revenue Code of 1986, as amended
from time to time, or any successor statute thereto. Reference to any provision of the Code shall mean such provision as in effect from time to time, as the same may be amended, and any successor provision thereto, as interpreted by any applicable
regulations as in effect from time to time. 
 “Company” means Phillips Edison – ARC Shopping Center REIT
Inc., a corporation organized under the laws of the State of Maryland. 
 “Competitive Real Estate Commission”
means a real estate or brokerage commission for the purchase or sale of property that is reasonable, customary, and competitive in light of the size, type, and location of the property. 

“Conflicts Committee” shall have the meaning set forth in the Company’s Articles of Incorporation. 

  
 3 

 “Construction Fee” means a fee or other remuneration for acting as general
contractor and/or construction manager to construct improvements, supervise and coordinate projects or to provide major repairs or rehabilitation on a Property. 
 “Contract Sales Price” means the total consideration received by the Company for the sale of a Property, Loan or other Permitted Investment. 

“Cost of Loans and other Permitted Investments” means the sum of the cost of all Loans and Permitted Investments held by
the Company, calculated each month on an ongoing basis, and calculated as follows for each Loan or Permitted Investment: the lesser of (i) the amount actually paid or allocated to acquire or fund the Loan or Permitted Investment (exclusive of
any fees payable to the Advisor or the Sub-advisor or any their Affiliates in connection therewith, but inclusive of other expenses related thereto and the amount of any debt associated with or used to acquire or fund such Loan or Permitted
Investment) and (ii) the outstanding principal amount of such Loan or Permitted Investment, as of the time of calculation. With respect to any Loan or Permitted Investment held by the Company through a Joint Venture or partnership of which it
is, directly or indirectly, a co-venturer, such amount shall be the Company’s proportionate share thereof. 
 “Cost
of Real Estate Investments” means the sum of (i) with respect to Properties wholly owned, directly or indirectly, by the Company, the amount actually paid or allocated to the purchase, development, construction or improvement of
Properties (exclusive of any fees payable to the Advisor or the Sub-advisor or any their Affiliates in connection therewith, but inclusive of other expenses related thereto), plus the amount of any outstanding debt attributable to such Properties
and (ii) in the case of Properties owned by any Joint Venture or partnership in which the Company or the Partnership is, directly or indirectly, a co-venturer or partner, the portion of the amount actually paid or allocated to the purchase,
development, construction or improvement of Properties (exclusive of any fees payable to the Advisor or the Sub-advisor or any their Affiliates in connection therewith, but inclusive of other expenses related thereto), plus the amount of any
outstanding debt associated with such Properties that is attributable to the Company’s investment in the Joint Venture or partnership. 
 “Dealer Manager” means (i) Realty Capital Securities, LLC, a Delaware limited liability company, or (ii) any successor dealer manager to the Company. 

“Development Fee” means a fee for the packaging of a Property, including negotiating and approving plans, and
undertaking to assist in obtaining zoning and necessary variances and necessary financing for the Property, either initially or at a later date. 
 “Director” means a member of the Board of Directors of the Company. 
 “Disposition Fee” shall have the meaning set forth in Section 8.3. 

  
 4 

 “Distributions” means any distributions of money or other property by the
Company to owners of Shares, including distributions that may constitute a return of capital for federal income tax purposes. 

“Financing Fee” shall have the meaning set forth in Section 8.4. 

“GAAP” means accounting principles generally accepted in the United States. 

“Gross Proceeds” means the aggregate purchase price of all Shares sold for the account of the Company through an
Offering, without deduction for Organization and Offering Expenses. 
 “include,” “included,”
“including” and “such as” are to be construed as if followed by the phrase “without limitation.” 
 “Independent Appraiser” means a person with no material current or prior business or personal relationship with the Advisor or the Directors, who is engaged to a substantial extent in the
business of rendering opinions regarding the value of assets of the type held by the Company, and who is a qualified appraiser of real estate as determined by the Board. Membership in a nationally recognized appraisal society such as the American
Institute of Real Estate Appraisers (“M.A.I.”) or the Society of Real Estate Appraisers (“S.R.E.A.”) shall be conclusive evidence of such qualification. 

“Initial Public Offering” means the initial public offering of Shares registered on the Registration Statement pursuant
to the Securities Act of 1933, as amended. 
 “Invested Capital” means the amount calculated by multiplying the
total number of Shares purchased by Stockholders by the issue price, reduced by any amounts paid by the Company to repurchase or redeem Shares pursuant to the Company’s plan for redemption of Shares or otherwise. 

“Joint Venture” means any joint venture, limited liability company or other Affiliate of the Company that owns, in whole
or in part, on behalf of the Company any Properties, Loans or other Permitted Investments. 
 “Listed” or
“Listing” shall have the meaning set forth in the Company’s Articles of Incorporation. 

“Loans” means mortgage loans and other types of debt financing investments made by the Company or the Partnership,
either directly or indirectly, including through ownership interests in a Joint Venture or partnership, and including mezzanine loans, B-notes, bridge loans, convertible mortgages, wraparound mortgage loans, construction mortgage loans, loans on
leasehold interests, and participations in such loans. 
 “Management Fee Base” means, for a specified period,
the sum of the Cost of Real Estate Investments and the Cost of Loans and other Permitted Investments computed by taking the average of such sums at the end of each month during such specified period. 

  
 5 

 “NASAA Guidelines” means the NASAA Statement of Policy Regarding Real
Estate Investment Trusts as in effect on the date hereof. 
 “Net Income” means, for any period, the total
revenues of the Company applicable to such period, less the total expenses applicable to such period excluding additions to reserves for depreciation, bad debts or other similar non-cash reserves; provided, however, that Net Income
shall exclude the gain from the sale of the Company’s assets. 
 “Offering” means any offering of Shares
that is registered with the SEC pursuant to the Securities Act of 1933, as amended, excluding Shares offered under any employee benefit plan. 
 “Operating Cash Flow” means Operating Revenue Cash Flows minus the sum of (i) Operating Expenses, (ii) all principal and interest payments on indebtedness and other sums paid to
lenders, (iii) the expenses of raising capital such as Organization and Offering Expenses, legal, audit, accounting, underwriting, brokerage, listing, registration, and other fees, printing and other such expenses and taxes incurred in
connection with the issuance, distribution, transfer, registration and Listing of the Shares, (iv) taxes, (v) incentive fees paid in compliance with Section IV.F. of the NASAA Guidelines and (vi) Acquisition Fees, Acquisition
Expenses, real estate commissions on resale of property, and other expenses connected with the acquisition, disposition, and ownership of real estate interests, loans or other property (other than commissions on the sale of assets other than real
property), such as the costs of foreclosure, insurance premiums, legal services, maintenance, repair and improvement of property. 
 “Operating Expenses” means all costs and expenses incurred by the Company, as determined under GAAP, that in any way are related to the operation of the Company or to Company business,
including fees paid to the Advisor, but excluding (i) the expenses of raising capital such as Organization and Offering Expenses, legal, audit, accounting, underwriting, brokerage, listing, registration, and other fees, printing and other such
expenses and taxes incurred in connection with the issuance, distribution, transfer, registration and Listing of the Shares, (ii) interest payments, (iii) taxes, (iv) non-cash expenditures such as depreciation, amortization, bad loan
reserves, impairments of value, and mark-to-market losses, (v) incentive fees paid in compliance with Section IV.F. of the NASAA Guidelines, and (vi) Acquisition Fees, Acquisition Expenses, real estate commissions on resale of
property, property management fees, and other expenses connected with the acquisition, disposition, and ownership of real estate interests, loans or other property (other than commissions on the sale of assets other than real property), such as the
costs of foreclosure, insurance premiums, legal services, maintenance, repair and improvement of property. 
 “Operating
Revenue Cash Flows” means the Company’s cash flow from ownership and/or operation of (i) Properties, (ii) Loans, (iii) Permitted Investments, (iv) short-term investments, and (v) interests in Properties, Loans
and Permitted Investments owned by any Joint Venture or any partnership in which the Company or the Partnership is, directly or indirectly, a co-venturer or partner. 

  
 6 

 “Organization and Offering Expenses” means all expenses incurred by or on
behalf of the Company in connection with or in preparing the Company for registration of and subsequently offering and distributing its Shares to the public, whether incurred before, on or after the date of this Agreement, including total
dealer-manager, underwriting and brokerage discounts and commissions; legal fees and expenses of any dealer-manager or underwriter; expenses for printing, engraving and mailing; compensation of employees while engaged in sales activity; charges of
transfer agents, registrars, trustees, escrow holders, depositaries and experts; expenses of qualification of the sale of the securities under Federal and state laws; taxes and fees, accountants’ and attorneys’ fees and expenses.

 “Other Liquidity Event” has the meaning set forth in Section 13.3(F). 

“Partnership” means Phillips Edison – ARC Shopping Center Operating Partnership, L.P., a Delaware limited
partnership formed to own and operate Properties, Loans and other Permitted Investments on behalf of the Company. 

“Permitted Investments” means all investments (other than Properties and Loans) in which the Company acquires an
interest, either directly or indirectly, including through ownership interests in a Joint Venture or partnership, pursuant to its Articles of Incorporation, Bylaws and the investment objectives and policies adopted by the Board from time to time,
other than short-term investments acquired for purposes of cash management. 
 “Person” or
“person” means an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c) (17) of the Code), a portion of a trust permanently set aside for or to be used exclusively
for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, or any government or any agency or political subdivision
thereof, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended. 
 “Property” or “Properties” means any real property or properties transferred or conveyed to the Company, the Partnership, or any subsidiary of the Company or the
Partnership, either directly or indirectly, and/or any real property or properties transferred or conveyed to a Joint Venture or partnership in which the Company is, directly or indirectly, a co-venturer or partner. 

“Property Manager” means an entity that has been retained to perform and carry out at one or more of the Properties
property-management services, excluding Persons retained or hired to perform facility management or other services or tasks at a particular Property, the costs for which are passed through to and ultimately paid by the tenant at such Property.

 “Prorated Term Fraction” means the fraction, the numerator of which is the number of days from and including
January 11, 2010 to and including the Termination Date, and the denominator of which is the number of days elapsed from and including 

  
 7 

 
January 11, 2010 to and including the date of the determination of the amount of any Subordinated Share of Cash Flows and/or the Subordinated Incentive Fee, as applicable. 

“Registration Statement” means the registration statement filed by the Company with the SEC pursuant to the Securities
Act of 1933, as amended, on Form S-11, as amended from time to time, in connection with the Initial Public Offering. 

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

“Sale” or “Sales” means (i) any transaction or series of transactions whereby: (A) the
Company or the Partnership sells, grants, transfers, conveys, or relinquishes its direct or indirect ownership of any Property, Loan or other Permitted Investment or portion thereof, including the transfer of any Property that is the subject of a
ground lease, and including any event with respect to any Property, Loan or other Permitted Investment that gives rise to a significant amount of insurance proceeds or condemnation awards; (B) the Company or the Partnership sells, grants,
transfers, conveys, or relinquishes its ownership of all or substantially all of the direct or indirect interest of the Company or the Partnership in any Joint Venture or partnership in which it is, directly or indirectly, a co-venturer or partner;
or (C) any Joint Venture or partnership (in which the Company or the Partnership is, directly or indirectly, a co-venturer or partner) sells, grants, transfers, conveys, or relinquishes its direct or indirect ownership of any Property, Loan or
other Permitted Investment or portion thereof, including any event with respect to any Property, Loan or other Permitted Investment that gives rise to insurance claims or condemnation awards, but (ii) not including any transaction or series of
transactions specified in clause (i)(A), (i)(B), or (i)(C) above in which the proceeds of such transaction or series of transactions are reinvested in one or more Properties, Loans or other Permitted Investments within 180 days
thereafter. 
 “SEC” means the United States Securities and Exchange Commission. 

“Settlement” means (i) the payment of principal, prepayment, maturity, workout or other settlement of any Loan or
other Permitted Investment or portion thereof owned, directly or indirectly, by (A) the Company or the Partnership or (B) any Joint Venture or any partnership in which the Company or the Partnership is, directly or indirectly, a partner,
but (ii) not including any transaction or series of transactions specified in clause (i)(A) or (i)(B) above in which the proceeds of such prepayment, maturity, workout or other settlement are reinvested in one or more
Properties, Loans or other Permitted Investments within 180 days thereafter. 
 “Shares” means the shares of
common stock of the Company, par value $.01 per share. 
 “Stockholders” means the registered holders of the
Shares. 
 “Stockholders’ 7% Return” means, as of any date, an aggregate amount equal to a 7% cumulative,
non-compounded, annual return on Invested Capital (calculated like simple interest on a daily basis based on a three hundred sixty-five day year). For 

  
 8 

 
purposes of calculating the Stockholders’ 7% Return, Invested Capital shall be determined for each day during the period for which the Stockholders’ 7% Return is being calculated and
shall be calculated net of (1) Distributions of Operating Cash Flow to the extent such Distributions of Operating Cash Flow provide a cumulative, non-compounded, annual return in excess of 7%, as such amounts are computed on a daily basis based
on a three hundred sixty-five day year and (2) Distributions of Cash from Sales, Settlements and Financings, except to the extent such Distributions would be required to supplement Distributions of Operating Cash Flow in order to achieve a
cumulative, non-compounded, annual return of 7%, as such amounts are computed on a daily basis based on a three hundred sixty-five day year. 
 “Sub-advisor” means (i) Phillips Edison NTR LLC (formerly known as Phillips Edison & Company SubAdvisor LLC), a Delaware limited liability company, or (ii) any
successor sub-advisor to the Advisor. 
 “Sub-advisory Agreement” means that Second Amended and Restated
Sub-advisory Agreement between the Advisor and the Sub-advisor, dated as of the date hereof, as the same may be amended, restated or otherwise modified from time to time in accordance with its terms. 

“Subordinated Incentive Fee” means the fee payable to the Advisor under certain circumstances if the Shares are Listed,
as calculated in Section 8.6. 
 “Subordinated Share of Cash Flows” means any amount payable to the
Advisor or its assignees pursuant to Section 8.5. 
 “Termination” means the termination of this
Agreement in accordance with Article 13 hereof. 
 “Termination Date” means the date of termination of
the Agreement if such termination does not coincide with the parties entering into a renewed or amended advisory agreement. 

“2%/25% Guidelines” has the meaning set forth in Section 9.2(C). 

Article 2 

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

 Article 3 
 Duties Of The Advisor 

  
 9 

 The Advisor is responsible for managing, operating, directing and supervising the operations
and administration of the Company and its assets. The Advisor undertakes to use commercially reasonable efforts to present to the Company potential investment opportunities and to provide the Company with a continuing and suitable investment program
consistent with the investment objectives and policies of the Company as determined and adopted from time to time by the Board. Subject to the limitations set forth in this Agreement, including Article 4 hereof, consistent with the provisions
of the Articles of Incorporation and Bylaws and the continuing and exclusive authority of the Board over the supervision of the Company, the Advisor shall, either directly or by engaging an Affiliate, the Sub-advisor or third party, perform the
following duties: 
  

	3.1	Organizational and Offering Services. The Advisor shall perform all services related to the organization of the Company or any Offering or private sale of the
Company’s securities, other than services that (i) are to be performed by the Dealer Manager, (ii) the Company elects to perform directly or (iii) would require the Advisor to register as a broker-dealer with the SEC or any
state. 

  

	3.2	Acquisition Services. The Advisor shall: 

  

	 	(A)	Serve as the Company’s investment and financial advisor and provide relevant market research and economic and statistical data in connection with the
Company’s assets and investment objectives and policies; 

  

	 	(B)	Subject to Article 4 hereof and the investment objectives and policies of the Company: (a) locate, analyze and select potential investments;
(b) structure and negotiate the terms and conditions of transactions pursuant to which investments in Properties, Loans and other Permitted Investments will be made; (c) acquire, originate and dispose of Properties, Loans and other
Permitted Investments on behalf of the Company (including through Joint Ventures); (d) arrange for financing and refinancing and make other changes in the asset or capital structure of investments in Properties, Loans and other Permitted
Investments; (e) select Joint Venture partners and structure corresponding agreements; and (f) enter into leases, service contracts and other agreements for Properties, Loans and other Permitted Investments; 

 

	 	(C)	Perform due diligence on prospective investments and create due diligence reports summarizing the results of such work; 

 

	 	(D)	Prepare reports regarding prospective investments that include recommendations and supporting documentation necessary for the Directors to evaluate the proposed
investments; 

  

	 	(E)	Obtain reports (which may be prepared by the Advisor, the Sub-advisor or their Affiliates), where appropriate, concerning the value of contemplated investments of the
Company; 

  
 10 

	 	(F)	Deliver to or maintain on behalf of the Company copies of all appraisals obtained in connection with the Company’s investments; and 

 

	 	(G)	Negotiate and execute approved investments and other transactions, including Settlements of Loans and other Permitted Investments. 

 

	3.3	Asset Management Services. The Advisor shall (or shall retain other Persons to (but shall remain responsible to the Company)): 

 

	 	(A)	Real Estate and Related Services: 

  

	 	(1)	Investigate, select and, on behalf of the Company, engage and conduct business with (including enter contracts with) and supervise the performance of such Persons as
the Advisor deems necessary to the proper performance of its obligations as set forth in this Agreement, including consultants, accountants, lenders, technical advisors, attorneys, brokers, underwriters, corporate fiduciaries, escrow agents,
depositaries, custodians, agents for collection, insurers, insurance agents, banks, builders, developers, property owners, security investment advisors, mortgagors, the registrar and the transfer agent, construction companies, Property Managers and
any and all Persons acting in any other capacity deemed by the Advisor necessary or desirable for the performance of any of the foregoing services; 

  

	 	(2)	Negotiate and service the Company’s debt facilities and other financings and negotiate on behalf of the Company with banks or other lenders for debt facilities to
be made to the Company or with investment banking firms and broker-dealers or negotiate private sales of Shares or obtain debt facilities for the Company, but in no event in such a manner so that the Advisor shall be acting as a broker-dealer or
underwriter; provided, however, that any fees and costs payable to third parties incurred by the Advisor in connection with the foregoing shall be the responsibility of the Company; 

 

	 	(3)	Monitor applicable markets and obtain reports (which may be prepared by the Advisor, the Sub-advisor or their Affiliates) where appropriate, concerning the value of
investments of the Company; 

  

	 	(4)	Monitor and evaluate the performance of each asset of the Company and the Company’s overall portfolio of assets, provide daily management services to the Company
and perform and supervise the various management and operational functions related to the Company’s investments; 

  

	 	(5)	 Formulate and oversee the implementation of strategies for the administration, promotion, management, operation, maintenance, investment, improvement,
financing and refinancing, marketing, 

  
 11 

	 	 
leasing and disposition of Properties, Loans and other Permitted Investments on an overall portfolio basis; 

 

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

  

	 	(7)	Oversee the performance by the Property Managers of their duties, including collection and proper deposits of rental payments and payment of Property expenses and
maintenance; 

  

	 	(8)	Conduct periodic on-site property visits to some or all (as the Advisor or its designee deems reasonably necessary) of the Properties to inspect the physical condition
of the Properties and to evaluate the performance of the Property Managers; 

  

	 	(9)	Review, analyze and comment upon the operating budgets, capital budgets and leasing plans prepared and submitted by each Property Manager and aggregate these property
budgets into the Company’s overall budget; 

  

	 	(10)	Coordinate and manage relationships between the Company and any co-venturers or partners; and 

 

	 	(11)	Consult with the Company’s officers and the Board and provide assistance with the evaluation and approval of potential asset dispositions, sales and refinancings.

  

	 	(B)	Accounting and Other Administrative Services: 

  

	 	(1)	Provide the day-to-day management of the Company and perform and supervise the various administrative functions reasonably necessary for the management of the Company;

  

	 	(2)	From time to time, or at any time reasonably requested by the Board, make reports to the Board on the Advisor’s performance of services to the Company under this
Agreement; 

  

	 	(3)	 Make reports to the Conflicts Committee each quarter of the investments that have been made by other programs sponsored by the Advisor, the Sub-advisor
or any of their respective Affiliates, as well as any investments that have been made by the Advisor, Sub-advisor or any of their Affiliates directly, in each case to the extent such investments constitute a conflict of interest or a

  
 12 

	 	 
potential conflict of interest with the investment policies and objectives of the Company; 

  

	 	(4)	Provide or arrange for any administrative services and items, legal and other services, office space, office furnishings, personnel and other overhead items necessary
and incidental to the Company’s business and operations; 

  

	 	(5)	Provide financial and operational planning services; 

  

	 	(6)	Maintain accounting and other record-keeping functions at the Company and investment levels, including information concerning the activities of the Company as shall be
required to prepare and to file all periodic financial reports, tax returns and any other information required to be filed with the SEC, the Internal Revenue Service and any other regulatory agency; 

 

	 	(7)	Maintain and preserve all appropriate books and records of the Company; 

  

	 	(8)	Provide tax and compliance services and coordinate with appropriate third parties, including the Company’s independent auditors and other consultants, on related
tax matters; 

  

	 	(9)	Provide the Company with all necessary cash management services; 

  

	 	(10)	Deliver to, or maintain on behalf of, the Company copies of all appraisals obtained in connection with Properties, Loans and Permitted Investments;

  

	 	(11)	Manage and coordinate with the transfer agent the monthly dividend process and payments to Stockholders; 

 

	 	(12)	Consult with the Company’s officers and the Board and assist the Board in evaluating and obtaining adequate insurance coverage based upon risk management
determinations; 

  

	 	(13)	Consult with the Company’s officers and the Board and assist the Board in evaluating various liquidity events when appropriate; 

 

	 	(14)	Provide the Company’s officers and the Board with timely updates related to the overall regulatory environment affecting the Company, as well as managing
compliance with such matters, including compliance with the Sarbanes-Oxley Act of 2002; 

  
 13 

	 	(15)	Consult with the Company’s officers and the Board relating to the corporate governance structure and appropriate policies and procedures related thereto;

  

	 	(16)	Perform all reporting, record keeping, internal controls and similar matters in a manner to allow the Company to comply with applicable law, including federal and state
securities laws and the Sarbanes-Oxley Act of 2002; 

  

	 	(17)	Notify the Board of all proposed material transactions before they are completed; and 

 

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

 

	3.4	Stockholder Services. The Advisor shall (or shall retain other Persons to (but shall remain responsible to the Company)): 

 

	 	(A)	Manage services for and communications with Stockholders, including answering phone calls, preparing and sending written and electronic reports and other
communications; 

  

	 	(B)	Oversee the performance of the transfer agent and registrar; 

  

	 	(C)	Establish technology infrastructure to assist in providing Stockholder support and service; and 

 

	 	(D)	Consistent with Section 3.1, perform the various subscription processing services reasonably necessary for the admission of new Stockholders.

  

	3.5	Other Services. Except as provided in Article 7, the Advisor shall perform any other services reasonably requested by the Company (acting through the
Conflicts Committee). 

 Article 4 
 Authority of Advisor 
  

	4.1	General. All rights and powers to manage and control the day-to-day business and affairs of the Company shall be vested in the Advisor. The Advisor shall have
the power to delegate all or any part of its rights and powers to manage and control the business and affairs of the Company to such officers, employees, Affiliates, agents and representatives of the Advisor or the Company or to the Sub-advisor as
it may deem appropriate. Any authority delegated by the Advisor to any other Person shall be subject to the limitations on the rights and powers of the Advisor specifically set forth in this Agreement or the Articles of Incorporation.

  
 14 

	4.2	Powers of the Advisor. Subject to the express limitations set forth in this Agreement, to the continuing and exclusive authority of the Board over the
supervision of the Company, and to the right of the Advisor to delegate its responsibilities pursuant to Section 4.1, the power to direct the management, operation and policies of the Company shall be vested in the Advisor, which shall
have the power by itself and shall be authorized and empowered on behalf and in the name of the Company to carry out any and all of the objectives and purposes of the Company and to perform all acts and enter into and perform all contracts and other
undertakings that it may in its sole discretion deem necessary, advisable or incidental thereto to perform its obligations under this Agreement. 

  

	4.3	Approval by the Board. Notwithstanding the foregoing, the Advisor may not take any action on behalf of the Company without the prior approval of the Board or
duly authorized committees thereof if the Articles of Incorporation or Maryland General Corporation Law require the prior approval of the Board. The Advisor will deliver to the Board all documents reasonably required by it to evaluate a proposed
investment (and any related financing). 

  

	4.4	Modification or Revocation of Authority of Advisor. The Board may, at any time upon the giving of notice to the Advisor, modify or revoke the authority or
approvals set forth in Article 3 hereof and this Article 4; provided, however, that such modification or revocation shall be effective upon receipt by the Advisor and shall not be applicable to investment transactions to
which the Advisor has committed the Company prior to the date of receipt by the Advisor of such notification. 

Article 5 

Bank Accounts 
 The Advisor may establish and maintain one or more bank accounts in the name of the Company and may collect and deposit into any such account or accounts, and disburse from any such account or accounts,
any money on behalf of the Company, under such terms and conditions as the Board may approve; provided, that no funds shall be commingled with the funds of the Advisor. The Advisor shall upon request render appropriate accountings of such
collections and payments to the Board and the independent auditors of the Company. 
 Article 6 

Records And Financial Statements 
 The Advisor, in the conduct of its responsibilities to the Company, shall maintain adequate and separate books and records for the Company’s operations in accordance with GAAP, which shall be
supported by sufficient documentation to ascertain that such books and records are properly and accurately recorded. Such books and records shall be the property of the Company and shall be available for inspection by the Board and by counsel,
auditors and other authorized agents of the Company, at any time or from time 

  
 15 

 
to time during normal business hours. Such books and records shall include all information necessary to calculate and audit the fees or reimbursements paid under this Agreement. The Advisor shall
utilize procedures to attempt to ensure such control over accounting and financial transactions as is reasonably required to protect the Company’s assets from theft, error or fraudulent activity. All financial statements that the Advisor
delivers to the Company shall be prepared on an accrual basis in accordance with GAAP, except for special financial reports that by their nature require a deviation from GAAP. The Advisor shall liaise with the Company’s officers and independent
auditors and shall provide such officers and auditors with the reports and other information that the Company so requests. 

Article 7 

Limitation On Activities 
 Notwithstanding any provision in this Agreement to the contrary, the Advisor shall not take any action that, in its sole judgment made in good faith, would (i) adversely affect the ability of the
Company to qualify or continue to qualify as a REIT under the Code (unless the Board has determined that REIT qualification is not in the best interests of the Company and its Stockholders), (ii) subject the Company to regulation under the
Investment Company Act of 1940, as amended, (iii) violate any law, rule, regulation or statement of policy of any governmental body or agency having jurisdiction over the Company, its Shares or its other securities, (iv) require the
Advisor to register as a broker-dealer with the SEC or any state, or (v) violate the Articles of Incorporation or Bylaws. In the event an action that would violate any of clauses (i) through (v) of the preceding sentence but such
action has been ordered by the Board, the Advisor shall notify the Board of the Advisor’s judgment of the potential impact of such action and shall refrain from taking such action until it receives further clarification or instructions from the
Board. In such event, the Advisor shall have no liability for acting in accordance with the specific instructions of the Board so given. 
 Article 8 
 Fees 

 

	8.1	 Acquisition Fees. As compensation for the investigation, selection, sourcing and acquisition or origination (by purchase, investment or
exchange) of Properties, Loans and other Permitted Investments, the Company shall pay an Acquisition Fee calculated as set forth below in this Section 8.1 to the Advisor or its assignees for each such investment (whether an acquisition
or origination). With respect to the acquisition or origination of a Property, Loan or other Permitted Investment to be owned, directly or indirectly, by the Company or the Partnership, the Acquisition Fee payable to the Advisor or its assignees
shall equal 1.0% of the sum of the amount actually paid or allocated to fund the acquisition, origination, development, construction or improvement of the Property, Loan or other Permitted Investment, inclusive of the Acquisition Expenses associated
with such Property, Loan or other Permitted Investment and the amount of any debt 

  
 16 

	 	 
associated with, or used to fund the investment in, such Property, Loan or other Permitted Investment, but exclusive of the Acquisition Fee payable to the Advisor or its assignees. The
calculation of Acquisition Fees payable to the Advisor or its assignees will also include any amounts incurred or reserved for capital expenditures that will be used to provide funds for capital improvements and repairs applied to any real property
investment acquired where the Company plans to add value. With respect to the acquisition or origination of a Property, Loan or other Permitted Investment through any Joint Venture or any partnership in which the Company or the Partnership is,
directly or indirectly, a co-venturer or partner, the Acquisition Fee payable to the Advisor or its assignees shall equal 1.0% of the portion that is attributable to the Company’s or the Partnership’s direct or indirect investment in such
Joint Venture or partnership of the amount actually paid or allocated to fund the acquisition, origination, development, construction or improvement of the Property, Loan or other Permitted Investment, inclusive of the Acquisition Expenses
associated with such Property, Loan or other Permitted Investment, plus the amount of any debt associated with, or used to fund the investment in, such Property, Loan or other Permitted Investment, but exclusive of the Acquisition Fee so payable to
the Advisor or its assignees. The Advisor shall submit an invoice to the Company following the closing or closings of each acquisition or origination, accompanied by a computation of the Acquisition Fee. The Acquisition Fee payable to the Advisor or
its assignees shall be paid at the closing of the transaction upon receipt of the invoice by the Company. 

  

	8.2	Asset Management Fee. The Company shall pay the Advisor or its assignees as compensation for the services described in Section 3.3 hereof a quarterly
fee (the “Asset Management Fee”) in an amount equal to 0.25% of the Management Fee Base. The Asset Management Fee is payable quarterly in advance, on January 1, April 1, July 1 and October 1, in the
amount of 0.25% of the Management Fee Base for the preceding fiscal quarter. The Advisor shall submit an invoice to the Company, accompanied by a computation of the Asset Management Fee for the applicable period. The Asset Management Fee will be
appropriately pro rated for any partial fiscal quarter. 

 Notwithstanding the foregoing, the Advisor shall elect
on a quarterly basis, to waive a portion of the Asset Management Fee payable for any applicable period if (i) as of the date of payment, the Company’s Modified Funds From Operations (“MFFO”) for the immediately preceding fiscal
quarter was less than the amount of distributions declared with respect to all record dates during such quarter and (ii) the distribution rate during such quarter was no more than $0.65 per share on an annualized basis. Accordingly, the portion
of the Asset Management Fee that is waived with respect to the applicable period will result in the Company achieving an MFFO amount for the period that is equal to the distributions declared during such period. As used herein, MFFO shall be defined
in accordance with the Investment Program Association Practice Guidelines 2010-01 issued in November 2010 or as subsequently modified by the Investment Program Association, with an additional adjustment to add back amounts received or

  
 17 

 
receivable from the Sub-advisor or an Affiliate thereof in the form of an additional capital contribution (without any corresponding issuance of equity in the form of common or preferred shares
of beneficial interest to the Sub-advisor or its Affiliate). 
  

	8.3	Disposition Fees. If the Advisor or Sub-advisor or any of their Affiliates provides a substantial amount of services (as determined by the Conflicts Committee)
in connection with a Sale, then the Advisor or its assignees shall receive a fee at the closing (a “Disposition Fee”) equal to 2.0% of the Contract Sales Price; provided, however, that no Disposition Fee shall be
payable if the Sale is to an Affiliate of either the Advisor or the Sub-Advisor; provided further, however, that the payment of any Disposition Fees by the Company shall be subject to any limitations contained in the Company’s
Articles of Incorporation. Any Disposition Fee payable under this Section 8.3 may be paid in addition to commissions paid to non-Affiliates, provided that the total commissions (including such Disposition Fee) paid to all Persons by the
Company for each Sale shall not exceed an amount equal to the lesser of (i) 6.0% of the aggregate Contract Sales Price of each applicable Property, Loan or other Permitted Investment and (ii) the Competitive Real Estate Commission for each
applicable Property, Loan or other Permitted Investment. Substantial assistance in connection with the Sale of a Property includes the preparation of an investment package for the Property (including a new investment analysis, rent rolls, tenant
information regarding credit, a property title report, an environmental report, a list of prospective buyers, a structural report and exhibits) or such other substantial services performed by the Advisor or Sub-advisor or any of their Affiliates in
connection with a Sale. The Disposition Fee payable to the Advisor or its assignees shall be paid at the closing of the transaction upon receipt of the invoice by the Company. 

 

	8.4	Financing Fee. In the event of any debt financing obtained by or for the Company, the Company will pay to the Advisor or its assignees upon the closing of such
debt financing a fee (a “Financing Fee”) equal to (i) 0.75% of the amount available under such debt financing, whether at the Company, Partnership, or any direct or indirect subsidiary level, and (ii) 0.75% of the portion
that is attributable to the Company’s or the Partnership’s direct or indirect investment in a Joint Venture or partnership in which the Company or the Partnership is, directly or indirectly, a co-venturer or partner. The Advisor (or
Sub-advisor) may reallow all or a portion of any Financing Fee to reimburse a non-Affiliated third party with whom it may subcontract to procure any such debt financing. All or any portion of the Financing Fees not taken as to any fiscal year shall
be deferred without interest and may be paid in such other fiscal year as the Advisor shall determine. 

  

	8.5	 Subordinated Share of Cash Flows. Subject to the last sentence of Section 8.6, the Company will pay, from time to time when
available, Subordinated Share of Cash Flows to the Advisor or its assignees in an amount equal to 15% of Operating Cash Flow and 15% of Cash from Sales, Settlements and Financings remaining after the Stockholders have received Distributions of
Operating Cash 

  
 18 

	 	 
Flow and of Cash from Sales, Settlements and Financings such that the owners of all outstanding Shares have received Distributions in an aggregate amount equal to the sum of, as of such point in
time: 

  

	 	(A)	the Stockholders’ 7% Return; and 

  

	 	(B)	Invested Capital. 

 When
determining whether the above threshold has been met: 
  

	 	(1)	Any stock dividend shall not be included as a Distribution; and 

  

	 	(2)	Distributions paid on Shares repurchased or redeemed by the Company (and thus no longer included in the determination of Invested Capital) shall not be included as a
Distribution. 

  

	8.6	Subordinated Incentive Fee. Upon Listing, the Advisor or its assignees shall be entitled to the Subordinated Incentive Fee in an amount equal to 15.0% of the
amount by which (i) the market value of the outstanding Shares, measured by taking the average closing price or the average of the bid and asked price, as the case may be, over a period of 30 days during which the Shares are traded, with such
period beginning 180 days after Listing (the “Market Value”), plus the total of all Distributions paid to Stockholders (excluding any stock dividends and any Distributions paid on Shares that have been repurchased or redeemed by the
Company) from the Company’s inception until the date that Market Value is determined, exceeds (ii) the sum of (A) 100% of Invested Capital and (B) the total Distributions required to be paid to the Stockholders as of the date
Market Value is determined in order to pay the Stockholders’ 7% Return from inception through the date Market Value is determined. The Company shall have the option to pay such fee in the form of cash, Shares, a non-interest-bearing short-term
promissory note or any combination of the foregoing. The Subordinated Incentive Fee will be reduced by the amount of any prior payments to the Advisor or its assignees of Subordinated Share of Cash Flows. In the event the Subordinated Incentive Fee
is paid to the Advisor or its assignees following Listing, no additional Subordinated Share of Cash Flows will be paid to the Advisor or its assignees. 

  

	8.7	Other Services. Should the Board request that the Advisor or the Sub-advisor or any Affiliate or director, officer or employee of any of the foregoing render
services for the Company other than as set forth in this Agreement, such services shall be separately compensated at such rates and in such amounts as are agreed upon by the Advisor, Sub-advisor or such Affiliate or other Person, on the one hand,
and the Board, including a majority of the Conflicts Committee, on the other hand, subject to the limitations contained in the Articles of Incorporation, and shall not be deemed to be services pursuant to the terms of this Agreement.

  

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

  
 19 

	8.9	Internalization. In the event that the Company’s board of directors elects to internalize any management services provided by the Advisor or the
Sub-advisor, the Company shall not pay any compensation or other remuneration to the Advisor or the Sub-advisor or any of their Affiliates in connection with such internalization transaction. For the avoidance of doubt, any compensation paid or
payable by the Company to employees of the Company in connection with their employment by the Company (which employees were formerly employed by the Advisor or the Sub-Advisor or any of their Affiliates) shall not be deemed to be compensation or
other remuneration in connection with any internalization transaction for purposes of the immediately preceding sentence. This provision shall not limit any other consideration or distributions that the Company may pay the Advisor or the Sub-Advisor
in accordance with this agreement or the Sub-Advisory Agreement (in each case, as such agreement may be amended, restated or modified from time to time) or any other agreement. This provision shall in no way obligate the Advisor or the Sub-Advisor
to facilitate an internalization transaction with the Advisor, the Sub-Advisor or any of their Affiliates. 

  

	8.10	Limitation on Fees. Notwithstanding anything herein to the contrary, the payment of any fees or expenses pursuant to Articles 8 and 13 by the
Company shall be subject to the limitations thereon contained in the Articles of Incorporation. 

 Article 9

 Expenses 
  

	9.1	General. In addition to the compensation paid to the Advisor pursuant to Article 8 hereof, the Company shall pay directly or reimburse the Advisor or
Sub-advisor, as the case may be, for all of the expenses paid or incurred by the Advisor, the Sub-advisor or their Affiliates on behalf of the Company or in connection with the services provided to the Company pursuant to this Agreement, including,
but not limited to: 

  

	 	(A)	All Organization and Offering Expenses; provided, however, that: 

 

	 	(1)	the Company shall not reimburse the Advisor or Sub-advisor to the extent such reimbursement would cause the total amount spent by the Company on Organization and
Offering Expenses (excluding underwriting and brokerage discounts and commissions, but including third-party due diligence fees and expenses as set forth in detailed and itemized invoices) to exceed 1.5% of Gross Proceeds raised in an Offering as of
the termination of such Offering; 

  

	 	(2)	 within 60 days after the end of the month in which an Offering terminates, the Advisor shall reimburse the Company to the extent the Company incurred
Organization and Offering Expenses (excluding underwriting and brokerage discounts and 

  
 20 

	 	 
commissions, but including third-party due diligence fees and expenses as set forth in detailed and itemized invoices) exceeding 1.5% of Gross Proceeds raised in such Offering;

  

	 	(3)	the Company shall not reimburse the Advisor or Sub-advisor for any Organization and Offering Expenses that the Conflicts Committee determines are not fair and
commercially reasonable to the Company; and 

  

	 	(4)	the Company shall not make any reimbursement for any of the following Organization and Offering Expenses incurred by the Dealer Manager that are to be paid out of the
Dealer Manager’s fee: 

  

	 	(a)	participating broker-dealer expense reimbursements (including meals with financial advisors and participating broker-dealer client seminars); 

 

	 	(b)	sales seminars sponsored by participating broker-dealers; 

  

	 	(c)	promotional items; 

  

	 	(d)	marketing support; 

  

	 	(e)	expenses in connection with bona fide training and educational meetings; 

  

	 	(f)	wholesaling commissions, wholesaling salaries and wholesaling expense reimbursements (including travel, meals and lodging in connection with the Offering);

  

	 	(g)	occasional meals and entertainment expenses of participating broker-dealers; and 

 

	 	(h)	legal fees and expenses of the Dealer Manager associated with FINRA-related filings or the drafting and review of any dealer manager agreements, participating
broker-dealer agreements and due diligence agreements. 

  

	 	(B)	Acquisition Fees and Acquisition Expenses incurred in connection with the selection and acquisition of Properties, Loans and other Permitted Investments, including such
expenses incurred related to assets pursued or considered but not ultimately acquired by the Company; provided, however, that, notwithstanding anything herein to the contrary, the payment of Acquisition Fees and Acquisition Expenses by
the Company shall be subject to the limitations contained in the Company’s Articles of Incorporation; 

  
 21 

	 	(C)	The actual out-of-pocket cost of goods and services used by the Company and obtained from entities not Affiliated with the Advisor or Sub-advisor, including travel,
meals and lodging expenses incurred by the Advisor or Sub-advisor in performing duties associated with the acquisition or origination of Properties, Loans or other Permitted Investments; 

 

	 	(D)	Interest and other costs for borrowed money, including discounts, points and other similar fees; 

 

	 	(E)	Taxes and assessments on income or Properties, taxes as an expense of doing business and any other taxes otherwise imposed on the Company and its business, assets or
income; 

  

	 	(F)	Out-of-pocket costs associated with insurance required in connection with the business of the Company or by its officers and Directors; 

 

	 	(G)	Expenses of managing, improving, developing, operating and selling Properties, Loans and other Permitted Investments owned, directly or indirectly, by the Company, as
well as expenses of other transactions relating to such Properties, Loans and other Permitted Investments, including prepayments, maturities, workouts and other settlements of Loans and other Permitted Investments; 

 

	 	(H)	All out-of-pocket expenses in connection with payments to the Board and meetings of the Board and Stockholders; 

 

	 	(I)	All out-of-pocket expenses associated with a Listing, if applicable; 

  

	 	(J)	Personnel and related employment costs incurred by the Advisor, the Sub-advisor or their Affiliates in performing the services described in Article 3 hereof,
including reasonable salaries and wages (but excluding bonuses), benefits and overhead of all employees directly involved in the performance of such services; provided, however, that no reimbursement shall be made for costs of such
employees of the Advisor, Sub-advisor or their Affiliates to the extent that such employees performed services for which the Advisor received Acquisition Fees, Financing Fees or Disposition Fees; 

 

	 	(K)	Out-of-pocket expenses of providing services for and maintaining communications with Stockholders, including the cost of preparation, printing, and mailing annual
reports and other Stockholder reports, proxy statements and other reports required by governmental entities; 

  

	 	(L)	Audit, accounting and legal fees, and other fees for professional services relating to the operations of the Company and all such fees incurred at the request, or on
behalf of, the Board, the Conflicts Committee or any other committee of the Board; 

  
 22 

	 	(M)	Out-of-pocket costs for the Company to comply with all applicable laws, regulations and ordinances; 

 

	 	(N)	Expenses connected with payments of Distributions made or caused to be made by the Company to the Stockholders; 

 

	 	(O)	Expenses of organizing, redomesticating, merging, liquidating or dissolving the Company or of amending the Articles of Incorporation or the Bylaws; and

  

	 	(P)	All other out-of-pocket costs incurred by the Advisor or Sub-advisor in performing the Advisor’s duties hereunder. 

 

	9.2	Timing of and Additional Limitations on Reimbursements. 

  

	 	(A)	Expenses incurred by the Advisor or Sub-advisor on behalf of the Company and reimbursable pursuant to this Article 9 shall be reimbursed no less than monthly to
the Advisor or Sub-advisor in the manner and proportion directed by the Advisor and Sub-advisor. The Advisor shall prepare a statement documenting the expenses of the Company during each quarter and shall deliver such statement to the Company within
45 days after the end of each quarter. 

  

	 	(B)	Notwithstanding anything else in this Article 9 to the contrary, the expenses enumerated in this Article 9 shall not become reimbursable to the Advisor
unless and until the Company has raised $2,500,000 in the Initial Public Offering. 

  

	 	(C)	 Commencing upon the earlier to occur of the end of the fourth fiscal quarter after (1) the Company’s acquisition of its first real estate
asset and (2) six months after the commencement of the Initial Public Offering, the following limitation on Operating Expenses shall apply: The Company shall not reimburse the Advisor or Sub-advisor at the end of any fiscal quarter for the
portion of Operating Expenses that in the four consecutive fiscal quarters then ended (the “Expense Year”) exceeds (the “Excess Amount”) the greater of (i) 2% of Average Invested Assets and (ii) 25% of Net
Income (the “2%/25% Guidelines”) for such year unless the Conflicts Committee determines that the Excess Amount was justified, based on unusual and nonrecurring factors that the Conflicts Committee deems sufficient. If the Conflicts
Committee does not approve the Excess Amount as being so justified, the Advisor or Sub-advisor shall repay to the Company any Excess Amount paid to the Advisor or Sub-advisor during a fiscal quarter. If the Conflicts Committee determines the Excess
Amount was justified, then, within 60 days after the end of any fiscal quarter of the Company for which total reimbursed Operating Expenses for the Expense Year exceed the 2%/25% Guidelines, the Advisor, at the direction of the Conflicts Committee,
shall cause such fact to be disclosed to the 

  
 23 

	 	 
Stockholders in writing (or the Company shall disclose such fact to the Stockholders in the next quarterly report of the Company or by filing a Current Report on Form 8-K with the SEC within 60
days of such quarter end), together with an explanation of the factors the Conflicts Committee considered in determining that the Excess Amount was justified. The Company will ensure that such determination will be reflected in the minutes of the
meetings of the Board. All figures used in the foregoing computation shall be determined in accordance with GAAP applied on a consistent basis. 

 Article 10 
 Voting Agreement 

 

	10.1	Election of Directors. The Company agrees that it will take such actions that are necessary to cause William M. Kahane, Nicholas Schorsch or another
representative of the Advisor reasonably satisfactory to the Company and Sub-advisor to be a member of the initial Board of Directors of the Company if such representative executes an advance letter of resignation to become effective upon such time
that the Advisor is no longer serving as the advisor to the Company. 

  

	10.2	Other Voting of Shares. The Advisor agrees that, with respect to any Shares now or hereinafter owned by it, the Advisor will not vote or consent on matters
submitted to the stockholders of the Company regarding (i) the removal of the Advisor or any Affiliate of the Advisor or (ii) any transaction between the Company and the Advisor or any of its Affiliates. This voting restriction shall
survive until such time that the Advisor is no longer serving as such. 

  
 24 

 Article 11 
 Relationship Of Advisor And Company; Other Activities Of The Advisor 
  

	11.1	Relationship. The Company and the Advisor are not partners or joint venturers with each other, and nothing in this Agreement shall be construed to make them such
partners or joint venturers. Except as set forth in Section 11.3, nothing herein contained shall prevent the Advisor or any of its Affiliates from engaging in or earning fees from other activities, including, without limitation, the
rendering of advice to other Persons (including other REITs) and the management of other programs advised, sponsored or organized by the Advisor or any of its Affiliates. Nor shall this Agreement limit or restrict the right of any manager, director,
officer, member, partner, employee or equityholder of the Advisor or any of its Affiliates to engage in or earn fees from any other business or to render services of any kind to any other Person. The Advisor may, with respect to any investment in
which the Company is a participant, also render advice and service to each and every other participant therein, and earn fees for rendering such advice and service. Specifically, it is contemplated that the Company may enter into Joint Ventures or
other similar co-investment arrangements with certain Persons, and pursuant to the agreements governing such Joint Ventures or other similar co-investment arrangements, the Advisor may be engaged to provide advice and service to such Persons, in
which case the Advisor will earn fees for rendering such advice and service. The Advisor shall promptly disclose to the Board the existence of any condition or circumstance, existing or anticipated, of which it has knowledge, that creates or which
would reasonably result in a conflict of interest between the Advisor’s obligations to the Company and its obligations to or its interest in any other Person (it being understood and agreed that the conditions and circumstances referred to in
the second paragraph of Section 11.3 are deemed to have been disclosed to the Board for purposes of this Section 11.1). 

  

	11.2	Time Commitment. The Advisor shall, and shall cause its Affiliates and their respective employees, officers and agents to, devote to the Company such time as
shall be reasonably necessary to conduct the business and affairs of the Company in an appropriate manner consistent with the terms of this Agreement. The Company acknowledges that the Advisor and its Affiliates and their respective employees,
officers and agents may also engage in activities unrelated to the Company and may provide services to Persons other than the Company or any of its Affiliates. 

 

	11.3	 Investment Opportunities. The Advisor shall be required to use commercially reasonable efforts to present a continuing and suitable investment
program to the Company that is consistent with the investment policies and objectives of the Company. So long as the Advisor is acting in its capacity as advisor under this Agreement, the Advisor will not (and will cause its Affiliates to not)
(i) pursue any opportunity to acquire any Property, Loan or other Permitted Investment that fits within the Company’s strategy, or (ii) offer such Property, Loan or other

  
 25 

	 	 
Permitted Investment to a third party, in each case unless and until such opportunity is first presented to the Company. The Company shall have 30 days from the date of its receipt of a complete
written offering package relating to such opportunity, customary in scope and content, to notify the Advisor of the Company’s decision as to whether or not to pursue such opportunity. If the Company fails so to notify the Advisor within such
30-day period, the Company shall be deemed to have passed on such opportunity. If the Company passes on such opportunity, then the Advisor or such Affiliate, as the case may be, may acquire the subject investment or offer the subject investment to a
third party for a period of 180 days, in each case on terms and conditions (including price) that are not materially different from the terms and conditions set forth in the offering package to the Company. If at the expiration of such 180-day
period, such opportunity remains available, then the provisions of this Section 11.3 shall once again apply to such opportunity. 

 Notwithstanding the preceding, however, the Advisor or any Affiliate of the Advisor shall be permitted to pursue any opportunity or to offer any opportunity to a third party in respect of (i) any net
leased retail, office and industrial properties or other property consistent with the investment policies of American Reality Capital Trust, Inc., (ii) any commercial real estate or other real estate investments that relate to office, retail,
multi-family residential, industrial and hotel property types, located primarily in the New York metropolitan area or other property consistent with the investment policies of American Realty Capital New York Recovery REIT, Inc., or (iii) any
investments to be made by a contemplated non-traded REIT (the “Identified REIT”) that the Advisor or any of its Affiliates described as (a) intending to invest primarily in “power center” real estate developments,
(b) being sponsored or co-sponsored by ARC (or one of its Affiliates), the acquisition services for which will be provided by an international commercial and residential real estate developer and manager (or one of its Affiliates), and
(c) being the subject of an executed letter of intent or term sheet between the Advisor (or one of its Affiliates) and such international commercial and residential real estate developer and manager (or one of its Affiliates), and which has or
will have as its publicly disclosed (and not subsequently revised or required to be revised under applicable securities laws) investment objectives to have less than 20% of its assets (measured by purchase price) in anchored shopping centers with
purchase prices of less than $20,000,000 per property (determined once the proceeds of the offering have been fully invested). 

Article 12 

The Phillips Edison and ARC Names 
  

	12.1	 The American Realty Capital and ARC Names. The Advisor and its Affiliates have or may have a proprietary interest in the names “American
Realty Capital,” “ARC” and “AR Capital.” The Advisor hereby grants to the Company, to the extent of any proprietary interest the Advisor may have in any of the names “American Realty Capital,” “ARC” and
“AR Capital,” a non-transferable, non-assignable, 

  
 26 

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

  

	12.2	 The Phillips Edison and PECO Names. The Sub-advisor and its Affiliates have or may have a proprietary interest in the names “Phillips
Edison” and “PECO.” The Sub-advisor hereby grants to the Company, to the extent of any proprietary interest the Sub-advisor may have in the names “Phillips Edison” and “PECO,” a non-transferable, non-assignable,
non-exclusive royalty-free right and license to use the names “Phillips Edison” and “PECO” during the term of this Agreement. The Company and Advisor agree that the Sub-advisor and its Affiliates will have the right to approve of
any use by the Company of the names “Phillips Edison” or “PECO,” such approval not to be unreasonably withheld or delayed. Accordingly, and in recognition of this right, if at any time the Advisor ceases to retain the Sub-advisor
or one of its Affiliates to perform advisory services for the Company, the Company will, promptly after receipt of written request from the Sub-advisor, cease to conduct business under or use the names “Phillips Edison”

  
 27 

	 	 
and “PECO” or any derivative thereof and the Company shall change its name and the names of any of its subsidiaries to a name that does not contain any of the names “Phillips
Edison” and “PECO” or any other word or words that might, in the reasonable discretion of the Sub-advisor, be susceptible of indication of some form of relationship between the Company and the Sub-advisor or any its Affiliates. At
such time, the Company will also make any changes to any trademarks, servicemarks or other marks necessary to remove any references to any of the names “Phillips Edison” or “PECO.” Consistent with the foregoing, it is
specifically recognized that the Sub-advisor or one or more of its Affiliates has in the past and may in the future organize, sponsor or otherwise permit to exist other investment vehicles (including vehicles for investment in real estate) and
financial and service organizations having the names “Phillips Edison” or “PECO” as a part of their name, all without the need for any consent (and without the right to object thereto) by the Company. Neither the Sub-advisor nor
any of its Affiliates makes any representation or warranty, express or implied, with respect to the names “Phillips Edison” or “PECO” licensed hereunder or the use thereof (including without limitation as to whether the use of
the name “Phillips Edison” or “PECO” will be free from infringement of the intellectual property rights of third parties). Notwithstanding the preceding, the Sub-advisor represents and warrants that it is not aware of any pending
claims or litigation or of any claims threatened in writing regarding the use or ownership of the names “Phillips Edison” or “PECO.” 

 Article 13 
 Term And Termination Of The Agreement 

 

	13.1	Term. This Agreement shall have an initial term ending June 30, 2011 and may be renewed for an unlimited number of successive one-year terms upon mutual
consent of the parties. The Company (acting through the Conflicts Committee) will evaluate the performance of the Advisor annually before renewing this Agreement, and each such renewal shall be for a term of no more than one year. Any such renewal
must be approved by the Conflicts Committee. 

  

	13.2	Termination by Either Party. This Agreement may be terminated upon 60 days’ written notice without cause or penalty by either the Company (acting through
the Conflicts Committee) or the Advisor. The provisions of Section 8.5, 8.6 and 14.2 and Articles 1, 12, 13, 15 and 16 (other than Section 16.11) shall survive termination of
this Agreement. Notwithstanding anything else that may be to the contrary herein, the expiration or earlier termination of this Agreement shall not relieve a party for liability for any breach occurring prior to such expiration or earlier
termination. 

  

	13.3	Payments on Termination and Survival of Certain Rights and Obligations. 

 

	 	(A)	 After the Termination Date, the Advisor shall not be entitled to compensation for further services hereunder except the Advisor (and its

  
 28 

	 	 
assignees, including the Sub-advisor) shall be entitled to receive from the Company (1) all unpaid reimbursements of expenses and all earned but unpaid fees payable to the Advisor or its
assignees prior to termination of this Agreement, payable within 30 days after the effective date of such termination, and (2) to the extent not already payable pursuant to the preceding clause or to the extent not already paid, the
Subordinated Share of Cash Flows and/or the Subordinated Incentive Fee payable when and as provided in Article 8; provided, that the amount of each Subordinated Share of Cash Flows and the amount of the Subordinated Incentive Fee shall be
reduced by multiplying such amount by the Prorated Term Fraction. 

  

	 	(B)	The Advisor shall promptly upon termination: 

  

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

  

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

  

	 	(3)	deliver to the Board all assets and documents of the Company then in the custody of the Advisor; and 

 

	 	(4)	cooperate with the Company to provide an orderly transition of advisory functions. 

 

	 	(C)	After the Termination Date, the Sub-advisor shall be entitled to receive from the Company (1) all unpaid reimbursements of expenses and all earned but unpaid fees
payable to the Sub-advisor prior to the termination of this Agreement, payable within 30 days after the effective date of such termination, and (2) to the extent not already payable pursuant to the preceding clause or to the extent not already
paid, the Sub-advisor’s share of the Subordinated Share of Cash Flows and/or the Subordinated Incentive Fee, as assignee thereof, payable when and as provided in Article 8; provided, that the amount of the Sub-advisor’s share of
each Subordinated Share of Cash Flows and the amount of the Sub-advisor’s share of the Subordinated Incentive Fee shall be reduced by multiplying such amount by the Prorated Term Fraction. 

 

	 	(D)	 After the termination of the Sub-advisory Agreement, to the extent payments are not provided for by Section 13.3(C) (i.e., if the
Sub-advisory Agreement is terminated independently of the Advisory Agreement), the Sub-advisor shall be entitled to receive from the Company, within 30 days 

  
 29 

	 	 
after the effective date of such termination, all unpaid reimbursements of expenses and all earned but unpaid fees payable to the Sub-advisor prior to the termination of the Sub-advisory
Agreement. 

  

	 	(E)	Promptly upon the termination of the Sub-advisory Agreement, the Sub-advisor shall promptly upon such termination: 

 

	 	(1)	pay over to the Company all money, if any, collected and held on behalf of the Company pursuant to the Sub-advisory Agreement after deducting any accrued compensation
and reimbursement for its expenses to which it is then entitled; 

  

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

  

	 	(3)	deliver to the Board all assets and documents of the Company then in the custody of the Sub-advisor; and 

 

	 	(4)	cooperate with the Company to provide an orderly transition of advisory or sub-advisory functions. 

Article 14 

Assignment 
  

	14.1	Assignment of Agreement. This Agreement may be assigned by the Advisor to an Affiliate with the consent of the Conflicts Committee. This Agreement shall not be
assigned by the Company without the consent of the Advisor, except in the case of an assignment by the Company to a corporation or other organization that is a successor to all of the assets, rights and obligations of the Company, in which case such
successor organization shall be bound hereunder and by the terms of said assignment in the same manner as the Company is bound by this Agreement. 

  

	14.2	Assignment of Payments. The Advisor may assign any rights to receive fees or other payments under this Agreement without obtaining the approval of the Board or
Conflicts Committee, and the Company shall honor and pay directly the assignee of such assignment. 

 Article 15

 Indemnification And Limitation Of Liability 

 

	15.1	 Indemnification. Except as prohibited by the restrictions provided in this Section 15.1, Section 15.2 and
Section 15.3, the Company shall indemnify, defend and 

  
 30 

	 	 
hold harmless the Advisor, the Sub-advisor and their Affiliates, as well as their respective officers, directors, equity holders, members, partners and employees, from all liability, claims,
damages or losses arising in the performance of their duties hereunder or under any sub-advisory agreement, and related expenses, including reasonable attorneys’ fees, to the extent such liability, claims, damages or losses and related expenses
are not fully reimbursed by insurance. Any indemnification of the Advisor or Sub-advisor may be made only out of the net assets of the Company and not from Stockholders. 

Notwithstanding the foregoing, the Company shall not indemnify the Advisor or Sub-advisor or their Affiliates, as well as their respective
officers, directors, equity holders, members, partners and employees, for any loss, liability or expense arising from or out of an alleged violation of federal or state securities laws by such party unless one or more of the following conditions are
met: (i) there has been a successful adjudication on the merits of each count involving alleged material securities law violations as to the particular indemnitee; (ii) such claims have been dismissed with prejudice on the merits by a
court of competent jurisdiction as to the particular indemnitee; or (iii) a court of competent jurisdiction approves a settlement of the claims against a particular indemnitee and finds that indemnification of the settlement and the related
costs should be made, and the court considering the request for indemnification has been advised of the position of the Securities and Exchange Commission and of the published position of any state securities regulatory authority in which securities
of the Company were offered or sold as to indemnification for violations of securities laws. 
  

	15.2	Limitation on Indemnification. Notwithstanding the foregoing, the Company shall not provide for indemnification of the Advisor, the Sub-advisor or their
Affiliates or of their respective officers, directors, equity holders, members, partners and employees, for any liability or loss suffered by any of them, nor shall any of them be held harmless for any loss or liability suffered by the Company,
unless all of the following conditions are met: 

  

	 	(A)	The Advisor, the Sub-advisor or one of their Affiliates (as applicable) has determined, in good faith, that the course of conduct that caused the loss or liability was
in the best interests of the Company. 

  

	 	(B)	The Advisor, the Sub-advisor or one of Affiliates (as applicable) was acting on behalf of or performing services for the Company. 

 

	 	(C)	Such liability or loss was not the result of negligence or misconduct by the Advisor, the Sub-advisor or one of their Affiliates (as applicable).

  

	15.3	 Limitation on Payment of Expenses. The Company shall pay or reimburse reasonable legal expenses and other costs incurred by any of the Advisor,
the Sub-advisor or their Affiliates, or by any of their respective officers, directors, equity holders, members, partners and employees, in advance of the final disposition of a

  
 31 

	 	 
proceeding only if (in addition to any applicable procedures required by the Maryland General Corporation Law, as amended from time to time) all of the following are satisfied: (a) the
proceeding relates to acts or omissions with respect to the performance of duties or services on behalf of the Company; (b) the legal proceeding was initiated by a third party who is not a stockholder or, if by a stockholder acting in his or
her capacity as such, a court of competent jurisdiction approves such advancement; and (c) such Person undertakes to repay the amount paid or reimbursed by the Company, together with the applicable legal rate of interest thereon, if it is
ultimately determined that such Person is not entitled to indemnification. 

 Article 16 

Miscellaneous 
  

	16.1	Notices. Any notice, request, demand, approval, consent, waiver or other communication required or permitted to be given hereunder or to be served upon any of
the parties hereto (each a “Notice”) shall be in writing and shall be (a) delivered in person, (b) sent by facsimile transmission (with the original thereof also contemporaneously given by another method specified in this
Section 16.1), (c) sent by a nationally-recognized overnight courier service, or (d) sent by certified or registered mail (postage prepaid, return receipt requested), to the address of such party set forth herein.

 To the Company or the Board: 
 Phillips Edison – ARC Shopping Center REIT Inc. 
 11501 Northlake Drive

 Cincinnati, OH 45249 
 with a copy to (which shall not constitute Notice): 
 DLA Piper LLP (US)

 4141 Parklake Drive , Suite 300 
 Raleigh, North Carolina 27612 
 Attention: Robert Bergdolt 

Telephone: (919) 786-2002 
 Facsimile: (919) 786-2202 
 To the Advisor: 

American Realty Capital II Advisors, LLC 
 405 Park Avenue 
 New York, New York 10022 

			
	Attention:	 	Nicholas S. Schorsch
		 	Jesse Galloway

  
 32 

 with a copy to (which shall not constitute Notice): 

Proskauer Rose LLP 
 1585 Broadway 
 New York, New York 10036 

			
	Attention:	 	Peter M. Fass, Esq.
		 	James P. Gerkis, Esq.

 Telephone:
(212) 969-3000 
 Facsimile: (212) 969-2900 
 To the Sub-advisor: 
 Phillips Edison NTR LLC 

11501 Northlake Drive 
 Cincinnati, OH 45249 
 with a copy to (which shall not constitute Notice):

 DLA Piper LLP (US) 
 4141 Parklake Drive, Suite 300 
 Raleigh, North Carolina 27612 

Attention: Robert Bergdolt 
 Telephone: (919) 786-2002 
 Facsimile: (919) 786-2202 

Any party may at any time give Notice in writing to the other party of a change in its address for the purposes of this
Section 16.1. Each Notice shall be deemed given and effective upon receipt (or refusal or receipt). 
  

	16.2	Modification. This Agreement shall not be amended, supplemented, changed, modified, terminated or discharged, in whole or in part, except by an instrument in
writing signed by the Company and the Advisor, or their respective successors or permitted assigns; provided, however, that no modification that impacts the rights or obligations of the Sub-advisor may be made without the
Sub-advisor’s consent and signature. 

  

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

  

	16.4	Construction. The provisions of this Agreement shall be construed and interpreted in accordance with the laws of the State of New York as at the time in effect,
without regard to the principles of conflicts of laws thereof. 

  

	16.5	 Entire Agreement. This Agreement contains the entire agreement and understanding among the parties hereto with respect to the subject matter
hereof, 

  
 33 

	 	 
and supersedes all prior and contemporaneous agreements, understandings, inducements and conditions, express or implied, oral or written, of any nature whatsoever with respect to the subject
matter hereof. The express terms hereof control and supersede any course of performance and/or usage of the trade inconsistent with any of the terms hereof. In all events, nothing contained herein shall be read, construed, interpreted or applied in
any manner that prevents or hinders the Company from qualifying as a real estate investment trust under Section 856(c) of the Code. 

  

	16.6	Waiver. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or
privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have
granted such waiver. 

  

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

  

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

  

	16.9	Third Party Beneficiary. The Sub-advisor is intended to be a third party beneficiary of the Company’s payment and indemnification obligations hereunder.
Except as set forth in the immediately preceding sentence and except for those Persons entitled to indemnification under Article 15 who shall be third party beneficiaries of this Agreement, no other Person is a third party beneficiary of this
Agreement. 

  

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

  

	16.11	 Restricted Stock. Each of the Company, the Advisor and the Sub-advisor agrees that no restricted stock awards or grants shall be made by the
Company to any Persons other than to (a) both the Advisor and the Sub-advisor, or (b) the members of the Conflicts Committee. To the extent that the Company makes 

  
 34 

	 	 
restricted stock awards or grants to the Advisor and the Sub-advisor, the Company shall issue (and the Advisor and the Sub-advisor shall use reasonable efforts to cause the Company to issue) 15%
of such restricted stock awards or grants to the Advisor and 85% of such restricted stock awards or grants to the Sub-advisor. In turn, each of the Advisor and the Sub-advisor may allocate, in its sole discretion and as it may determine, all or any
part of such restricted stock award or grant so issued to it to its or its Affiliates’ directors, officers, equityholders, partners, employees, members or to its respective Affiliates on such terms and conditions as may be determined by it.
Notwithstanding Section 13.2, the provision of this Section 16.11 shall terminate upon termination of this Agreement in accordance with its terms. 

[The remainder of this page is intentionally left blank. 
 Signature page follows.] 

  
 35 

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

					
		 	Phillips Edison – ARC Shopping Center REIT Inc.
			
		 	By:	 	
                    
            /s/ R. Mark Addy

		 		 	R. Mark Addy, Chief Operating Officer
		
		 	American Realty Capital II Advisors, LLC
			
		 	By:	 	
                    
            /s/ William M. Kahane

		 		 	William Kahane, President
		
	 With respect to Sections 8.9, 12.2
 and 13.3, Articles 9, 14, 15 and 16:
	 	 Phillips Edison NTR LLC (formerly known as
 Phillips Edison & Company SubAdvisor LLC)

			
		 	By:	 	
                    
            /s/ R. Mark Addy

		 		 	R. Mark Addy, Vice President

 [Signature
Page to Fifth Amended and Restated Advisory Agreement between Phillips Edison – ARC Shopping Center REIT Inc. 
 and
American Realty Capital II Advisors, LLC]

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