Document:

Exhibit 10.1

 

LIQUIDATING TRUST AGREEMENT

 

Dated as of February 27, 2012

 

by and among

 

Cornerstone Realty Fund, LLC

 

individually as Grantor

 

and

 

Cornerstone Industrial Properties, LLC

 

as Managing Trustee

 

    	 

    	 

    

 

TABLE OF CONTENTS

 

	 	 	Page
	 	 	 
	LIQUIDATING TRUST AGREEMENT	 	1
	 	 	 	 	 	 
	RECITALS:	 	 	 	1
	 	 	 	 	 	 
	Article
    I	 	NAME AND DEFINITIONS	 	1
	 	 	 	 	 	 
	 	1.1	 	Name	 	1
	 	 	 	 	 	 
	 	1.2	 	Certain Terms Defined	 	1
	 	 	 	 	 	 
	Article
    II	 	NATURE OF TRANSFER	 	4
	 	 	 	 	 	 
	 	2.1	 	Purpose of the Trust	 	4
	 	 	 	 	 	 
	 	2.2	 	No Reversion to the Fund	 	5
	 	 	 	 	 	 
	 	2.3	 	Payment of Liabilities	 	5
	 	 	 	 	 	 
	 	2.4	 	Bill of Sale, Assignment, Acceptance and Assumption Agreement; Instruments of Further Assurance	 	5
	 	 	 	 	 	 
	 	2.5	 	Incidents of Ownership	 	5
	 	 	 	 	 	 
	 	2.6	 	Notice to Unlocated Holders of Fund Units	 	5
	 	 	 	 	 	 
	Article
    III	 	BENEFICIARIES	 	5
	 	 	 	 	 	 
	 	3.1	 	Beneficial Interests	 	5
	 	 	 	 	 	 
	 	3.2	 	Rights of Beneficiaries	 	6
	 	 	 	 	 	 
	 	3.3	 	No Transfer of Interests of Beneficiaries	 	6
	 	 	 	 	 	 
	 	3.4	 	Managing Trustee as Beneficiary	 	7
	 	 	 	 	 	 
	Article
    IV	 	DURATION AND TERMINATION OF TRUST	 	7
	 	 	 	 	 	 
	 	4.1	 	Duration	 	7
	 	 	 	 	 	 
	 	4.2	 	Other Obligations of the Managing Trustee upon Termination	 	7
	 	 	 	 	 	 
	Article
    V	 	ADMINISTRATION OF TRUST ASSETS	 	7
	 	 	 	 	 	 
	 	5.1	 	Sale of Trust Assets	 	7
	 	 	 	 	 	 
	 	5.2	 	Authorized Activities	 	7
	 	 	 	 	 	 
	 	5.3	 	Payment of Claims, Expenses and Liabilities	 	7
	 	 	 	 	 	 
	 	5.4	 	Interim Distributions of Net Cash Flow from Operations	 	7
	 	 	 	 	 	 
	 	5.5	 	Interim Distributions of Net Sales Proceeds	 	8
	 	 	 	 	 	 
	 	5.5	 	Final Distribution	 	8
	 	 	 	 	 	 
	 	5.7	 	Limitations on Distributions	 	9
	 	 	 	 	 	 
	 	5.8	 	Reports to Beneficiaries and Others	 	9
	 	 	 	 	 	 
	 	5.9	 	Federal Income Tax Information	 	9
	 	 	 	 	 	 
	 	5.10	 	Employment of Manager	 	9
	 	 	 	 	 	 
	Article
    VI	 	MANAGING TRUSTEE	 	10
	 	 	 	 	 	 
	 	6.1	 	General Powers of the Managing Trustee	 	10
	 	 	 	 	 	 
	 	6.2	 	Specific Powers of the Managing Trustee	 	10
	 	 	 	 	 	 
	 	6.3	 	Compensation and Expense Reimbursement	 	11

 

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TABLE OF CONTENTS

(continued)

 

	 	 	 	 	 	Page
	 	 	 	 	 	 
	 	6.4	 	Contracts with the Managing Trustee and its Affiliates	 	12
	 	 	 	 	 	 
	 	6.5	 	Fiduciary Duty; Standard of Care	 	12
	 	 	 	 	 	 
	 	6.6	 	Rebates, Give-ups and Reciprocal Arrangements	 	12
	 	 	 	 	 	 
	 	6.6	 	Other Compensation	 	12
	 	 	 	 	 	 
	Article
    VII	 	CONCERNING THE MANAGING TRUSTEE, BENEFICIARIES, EMPLOYEES AND AGENTS	 	13
	 	 	 	 	 	 
	 	7.1	 	Generally	 	13
	 	 	 	 	 	 
	 	7.2	 	Reliance by the Managing Trustee	 	13
	 	 	 	 	 	 
	 	7.3	 	Limitation on Liability to Third Persons	 	14
	 	 	 	 	 	 
	 	7.4	 	Recitals	 	14
	 	 	 	 	 	 
	 	7.5	 	Indemnification	 	14
	 	 	 	 	 	 
	 	7.6	 	Rights of Managing Trustees, Employees, Independent Contractors and Agents to Own Trust Units or Other Property and to Engage in Other Business	 	16
	 	 	 	 	 	 
	Article VIII	 	THE MANAGING TRUSTEE AND SUCCESSOR MANAGING TRUSTEE	 	17
	 	 	 	 	 	 
	 	8.1	 	Number and Qualification of Managing Trustees	 	17
	 	 	 	 	 	 
	 	8.2	 	Resignation and Removal	 	17
	 	 	 	 	 	 
	 	8.3	 	Appointment of Successor	 	17
	 	 	 	 	 	 
	 	8.4	 	Acceptance of Appointment by Successor Managing Trustee	 	18
	 	 	 	 	 	 
	 	8.5	 	Bonds	 	18
	 	 	 	 	 	 
	Article
    IX	 	CONCERNING THE BENEFICIARIES	 	18
	 	 	 	 	 	 
	 	9.1	 	Evidence of Action by Beneficiaries	 	18
	 	 	 	 	 	 
	 	9.2	 	Limitation on Suits by Beneficiaries	 	18
	 	 	 	 	 	 
	 	9.3	 	Requirement of Undertaking	 	18
	 	 	 	 	 	 
	Article
    X	 	MEETING OF BENEFICIARIES	 	18
	 	 	 	 	 	 
	 	10.1	 	Meetings of Benficiaries	 	18
	 	 	 	 	 	 
	 	10.2	 	Purpose of Meetings	 	18
	 	 	 	 	 	 
	 	10.3	 	Place of Meetings	 	18
	 	 	 	 	 	 
	 	10.4	 	Notice of Meetings	 	19
	 	 	 	 	 	 
	 	10.5	 	Record Dates	 	19
	 	 	 	 	 	 
	 	10.6	 	Quorum	 	19
	 	 	 	 	 	 
	 	10.7	 	Proxies	 	19
	 	 	 	 	 	 
	 	10.8	 	Inspectors of Elections	 	19
	 	 	 	 	 	 
	 	10.9	 	Actions Without a Meeting	 	19
	 	 	 	 	 	 
	Article
    XI	 	AMENDMENTS	 	20
	 	 	 	 	 	 
	 	11.1	 	Consent of Beneficiaries	 	20
	 	 	 	 	 	 
	 	11.2	 	Effect of Amendment	 	20
	 	 	 	 	 	 
	 	11.3	 	Managing Trustee’s Declining to Execute Documents	 	20

 

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TABLE OF CONTENTS

(continued)

 

	 	 	 	 	Page
	 	 	 	 	 
	Article
    XII	 	MISCELLANEOUS PROVISIONS	 	20
	 	 	 	 	 	 
	 	12.1	 	Filing Documents	 	20
	 	 	 	 	 	 
	 	12.2	 	Beneficiaries Have No Rights or Privileges as Holders of Fund Units	 	21
	 	 	 	 	 	 
	 	12.3	 	Laws as to Construction	 	21
	 	 	 	 	 	 
	 	12.4	 	Severability	 	21
	 	 	 	 	 	 
	 	12.5	 	Notices	 	21
	 	 	 	 	 	 
	 	12.6	 	Counterparts	 	21
	 	 	 	 	 	 
	 	EXHIBIT A	 	A-1

 

    	-iii-

    	 

    

 

LIQUIDATING TRUST AGREEMENT

 

This LIQUIDATING TRUST
AGREEMENT (this “Agreement”), dated as of February 27, 2012 (the “Effective Date”), by and
between Cornerstone Realty Fund, LLC, a California limited liability company, as Grantor (the “Fund”) and Cornerstone
Industrial Properties, LLC, a California limited liability company, as Managing Trustee (the “Managing Trustee”).

 

RECITALS:

 

WHEREAS, the principal
purpose for which the Fund was organized was to engage for a competitive profit in any activity within the purposes for which limited
liability companies may be organized under the laws of the State of California, including the Beverly-Killea Limited Liability
Company Act;

 

WHEREAS, the managing member
of the Fund, Cornerstone Industrial Properties, LLC, a California limited liability company (the “Managing Member”)
and the Members of the Fund have approved the dissolution and winding down of the Fund’s affairs pursuant the Plan (as hereinafter
defined);

 

WHEREAS, the Fund will
transfer all of its assets (the “Fund Assets”) and liabilities including cash reserves set aside for the contingent
and existing obligations of the Fund and the Liquidating Trust (the “Cash Reserves”) to a trust (the “Liquidating
Trust” or “Trust”) with Cornerstone Industrial Properties, LLC serving as its initial Managing Trustee,;

 

WHEREAS, the Fund will
distribute the beneficial interests in the Trust to its members in liquidation of the Fund in accordance with the terms hereof;
and

 

WHEREAS, the Managing Trustee
shall administer the Liquidating Trust pursuant to the terms of this Agreement and, upon satisfaction of all liabilities and obligations
of the Fund and the Liquidating Trust, the Managing Trustee shall distribute the residue of the proceeds of the liquidation of
the assets of the Fund in accordance with the terms hereof.

 

NOW, THEREFORE, for good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Fund hereby agrees to grant, release,
assign, convey and deliver unto the Managing Trustee for the benefit of the Beneficiaries (as hereinafter defined), all of the
right, title and interest of the Fund in and to the Fund Assets and Cash Reserves for the uses and purposes stated herein on the
Effective Date, subject to the terms and provisions set out below, and the Managing Trustee hereby agrees to accept such Fund Assets
and Cash Reserves and such Trust, subject to the following terms and provisions:

 

Article
I

NAME
AND DEFINITIONS

 

1.1          Name.
This Trust shall be known as the Cornerstone Realty Fund Liquidating Trust.

 

1.2         Certain
Terms Defined. For all purposes of this instrument, unless the context otherwise requires:

 

(a)          “AFFILIATE”
shall mean, with respect to any Person, (i) any Person or entity directly or indirectly through one or more intermediaries controlling,
controlled by or under common control with another Person or entity, (ii) any Person or entity owning or controlling ten percent
(10%) or more of the outstanding voting securities of another Person or entity, (iii) any officer, director, partner or trustee
of such Person or entity, and (iv) if such other Person is an officer, director, partner or trustee of a Person or entity, the
Person or entity for which such other Person or entity acts in any such capacity.

 

(b)          “AGGREGATE
ASSETS VALUE” shall mean the aggregate book value of the assets of the Fund (other than investments in bank accounts,
money market funds and other current assets) at the time of measurement before deducting depreciation, bad debts or other similar
non-cash reserves and without reduction for any debt secured by or relating to such assets.

 

    	1

    	 

    

 

(c)          “AGREEMENT”
shall mean this instrument as originally executed or as it may from time to time be amended pursuant to the terms hereof.

 

(d)          “BENEFICIAL
INTEREST” shall mean each Beneficiary’s proportionate share of the Trust Assets in the Trust determined by the
ratio of the number of Fund Units held by the Initial Beneficiary on the close of business on the Record Date in the Fund over
the total number of Fund Units existing on such Record Date in the Fund and thereafter each Beneficiary’s proportional beneficial
interest in the Trust represented by Trust Units.

 

(e)          “BENEFICIARIES”
shall mean the holders of Trust Units from time to time on or after the Record Date, including the Initial Beneficiaries and the
Subsequent Beneficiaries.

 

(f)          “CAPITAL
CONTRIBUTION” shall mean, with respect to any Beneficiary, such Beneficiary’s (or its predecessor in interest’s)
“Capital Contribution” as defined in the Fund Agreement as of the Effective Date.

 

(g)          “CASH
FLOW” shall mean for each fiscal year, cash proceeds from operations of the Trust, including without limitation, interest
and other investment income but excluding Capital Contributions, and after deducting funds used to pay or provide for the payment
of all operating expenses of the Trust and each Trust Asset, and debt service, if any, capital improvements and replacements unless
otherwise reserved, without deduction for depreciation, amortization or other noncash expenditures.

 

(h)          “CODE”
shall mean the Internal Revenue Code of 1986, as amended.

 

(i)          “EARLY
INVESTORS’ 12% INCENTIVE RETURN” shall mean, with respect to any Beneficiary, such Beneficiary’s (or its
predecessor in interest’s) “Early Investors’ 12% Incentive Return”, if any, as defined in the Fund Agreement
as of the Effective Date.

 

(j)          “FUND
AGREEMENT” shall mean the Operating Agreement of Cornerstone Realty Fund, LLC, made effective July 19, 2001, amended
and restated as of June 30, 2003, and further amended on February 22, 2007, June 2, 2009 and April 27, 2010.

 

(k)          “FUND
UNITS” shall mean the limited liability company units in the Fund held by each of the Beneficiaries as of the Record
Date.

 

(l)          “GRANTOR”
shall mean the Fund.

 

(m)          “GROSS
REVENUES” shall mean all amounts actually collected as rents or other charges for the use and occupancy of Trust Assets,
but shall exclude interest and other investment income of the Trust and proceeds received by the Trust from a sale, exchange, condemnation,
eminent domain taking, casualty or other disposition of assets of the Trust.

 

(n)          “INITIAL
BENEFICIARIES” shall mean the initial holders of Trust Units.

 

(o)          “INVESTED
CAPITAL CONTRIBUTION” shall mean, with respect to any Beneficiary, such Beneficiary’s (or its predecessor in
interest’s) “Invested Capital Contribution” as defined in the Fund Agreement as of the Effective Date.

 

(p)          “LIQUIDATING
DISTRIBUTIONS” shall mean the net cash proceeds available to be distributed by the Trust to the Beneficiaries from (a)
the Sale of substantially all of the assets of the Trust or the last remaining assets of the Trust or (b) a liquidation of the
Trust Assets in connection with a dissolution of the Trust, after (i) payment of all expenses of such Sale or liquidation, including
real estate and other brokerage commissions and disposition fees, if applicable, (ii) the payment of any outstanding indebtedness
and other liabilities of the Trust, (iii) any amounts used to restore any such assets of the Trust, and (iv) any amounts set aside
as reserves which the Managing Trustee in its sole discretion may deem necessary or desirable.

 

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(q)          “LIQUIDATING
TRUST” shall mean the liquidating trust maintained by the Managing Trustee holding the Trust Assets of the Fund, identified
as the “Cornerstone Realty Fund Liquidating Trust”; also referred to herein as the “Trust.”

 

(r)          “MAJORITY
VOTE” shall mean the affirmative vote or written consent of Beneficiaries then owning of record more than fifty percent
(50%) of the outstanding Trust Units; provided, however, that any Trust Units owned or otherwise controlled by the Managing Trustee
or its Affiliates may not be voted and will not be included in the total number of outstanding Trust Units for purposes of this
definition unless such Trust Units are the only Trust Units outstanding as of the date of determination.

 

(s)          “MANAGER”
shall mean such Person or Persons who have been employed by, or who have contracted with, the Managing Trustee to assist in the
management of the Trust, and for the avoidance of doubt, the Manager may be the Managing Member or any Affiliate of the Managing
Member.

 

(t)          “MEMBERS”
shall mean the members under the Fund Agreement.

 

(u)          “NET
CASH FLOW FROM OPERATIONS” shall mean for each fiscal year, Cash Flow, less Net Sales Proceeds, less cash reserves established
by the Managing Trustee, in its sole discretion, for other obligations of the Trust for which there is no provision, less Distributions
made to the Beneficiaries prior to the end of such fiscal year.

 

(v)         “NET
SALES PROCEEDS” shall mean, in the case of a transaction described in the definition of Sale, the proceeds of any such
transaction less the amount of all real estate and other brokerage commissions, disposition fees and closing costs paid by the
Trust. In any case in which a Trust Asset is sold and the Trust receives a payment as a result thereof, such payment also shall
constitute Net Sales Proceeds. Net Sales Proceeds shall not include any reserves established by the Managing Trustee in its sole
discretion.

 

(w)          “PERSON”
shall mean any natural person, partnership, trust, corporation, association or other legal entity, including, but not limited to,
the Managing Member and any Affiliate of the Managing Member.

 

(x)          “PLAN”
shall mean that certain Cornerstone Realty Fund, LLC Plan of Liquidation and Dissolution approved and adopted by the Members on
May 29, 2011.

 

(y)          “RECORD
DATE” shall mean the date selected by the Grantor for determination of the holders of Fund Units entitled to become Beneficiaries.

 

(z)          “SALE”
shall mean any transaction or series of transactions whereby the Trust sells, grants, transfers, conveys, or relinquishes its ownership
and/or interest in any Trust Assets or any portion thereof, including any event with respect to any Trust Asset which gives rise
to a significant amount of insurance proceeds or condemnation awards.

 

(aa)         “SUBSEQUENT
BENEFICIARIES” shall mean Beneficiaries as reflected on the books and records of the Trust from time to time after the
Effective Date, other than the Initial Beneficiaries.

 

(bb)         “TREASURY
REGULATIONS” shall mean the Income Tax Regulations promulgated under the Code by the United States Treasury Department.

 

    	3

    	 

    

 

(cc)         “TRUST”
shall mean a California Statutory Trust pursuant to Division 9 of the California Probate Code.

 

(dd)         “TRUST
ASSETS” shall mean all the property held from time to time by the Managing Trustee under this Agreement, which initially
shall consist of the Fund Assets of the Fund granted, assigned and conveyed to the Managing Trustee by the Fund, the Cash Reserves,
and, in addition, shall thereafter include all proceeds and other receipts of, from, or attributable to any assets, causes of actions
or claims held by the Trust.

 

(ee)         “TRUST
UNITS” shall mean those equal, undivided portions into which the Beneficial Interests in the Trust Assets are divided,
as evidenced on the books and records of the Trust and as shall not be certificated or represented by any form of other instrument.

 

(ff)         “TRUSTEE(S)”
shall mean the original Trustee under this Agreement and its successor(s) and assignee(s), if any.

 

(gg)         “UNITHOLDERS’
8% PREFERRED RETURN” shall mean, with respect to any Beneficiary, such Beneficiary’s (or its predecessor in interest’s)
“Unitholders’ 8% Preferred Return”, if any as defined in the Fund Agreement as of the Effective Date.

 

Article
II

NATURE
OF TRANSFER

 

2.1         Purpose
of the Trust.

 

(a)          It
is expected that the Fund shall dissolve and liquidate prior to fully winding up its affairs, including, but not limited to, the
sale of its remaining assets, the collection of any receivables and the payment of any unsatisfied debts, claims, liabilities,
commitments, suits and other obligations, whether contingent or fixed or otherwise (the “Liabilities”), except
for such liabilities and obligations for which the Fund has previously established reserves by the retention of the Cash Reserves
as described in the recitals hereto. The Trust hereby is organized for the sole purpose of winding up the affairs of the Fund as
promptly as reasonably possible and with no objective to continue or engage in the conduct of a trade or business except as necessary
for the orderly liquidation of the Trust Assets.

 

(b)          The
Cash Reserves and Fund Assets to be granted, assigned and conveyed to the Managing Trustee as of the Effective Date will be held
in the Trust, and the Managing Trustee will: (i) further liquidate the Trust Assets as it deems necessary to carry out the
purpose of the Trust and facilitate distribution of the Trust Assets; (ii) protect, conserve and manage the Trust Assets in
accordance with the terms and conditions hereof; and (iii) distribute the Trust Assets in accordance with the terms and conditions
hereof.

 

(c)          It
is intended that for federal, state and local income tax purposes the Trust shall be treated as a business trust under Treasury
Regulation Section 301.7701-4(b), that the Trust will be classified for federal income tax purposes as a partnership under Treasury
Regulation Section 301.7701-3(b)(1)(i) and any analogous provision of state or local law, and that the Beneficiaries of the Trust
shall be treated as partners for federal tax purposes and any analogous provision of state or local law and shall be taxed on their
respective share of the Trust’s taxable income (including both ordinary income and capital gains) pursuant to Section 704
of the Code and any analogous provision of state or local law. It is further intended that the Fund business shall continue in
the Trust, that the partnership shall not terminate under 708 of the Code, that the taxable year of the partnership shall not close,
and that the Trust may use the Fund’s taxpayer identification number.

 

    	4

    	 

    

 

(d)          The
Managing Trustee shall file all tax returns required to be filed with any governmental agency consistent with Section 2.1(c). To
the extent that the Managing Trustee becomes liable for the payment of taxes, including withholding taxes, with respect to income
derived from the investment of funds held hereunder or any payment made hereunder (collectively, the “Taxes”),
the Managing Trustee may pay such Taxes from the assets of the Trust. The Managing Trustee may withhold from any payment of the
Trust Assets such amount as the Managing Trustee estimates to be sufficient to provide for the payment of such Taxes not yet paid,
and may use the sum withheld for that purpose. The Managing Trustee shall be indemnified and held harmless by the Trust against
any liability for Taxes and for any penalties or interest with respect to Taxes on such investment income or payments in the manner
provided herein.

 

2.2          No
Reversion to the Fund. In no event shall any part of the Trust Assets revert to or be distributed to the Fund.

 

2.3          Payment
of Liabilities. The Trust hereby agrees to assume all Liabilities of the Fund on the Effective Date. Should any Liability be
asserted against the Trust as the transferee of the Trust Assets or as a result of the assumption of the Liabilities, the Managing
Trustee may use such part of the Trust Assets as may be necessary in contesting any such Liability or in payment thereof. In no
event shall the Managing Trustee, Beneficiaries or employees or agents of the Trust be personally liable, nor shall any personal
property of such Persons or any other Trust Assets be subject to attachment, in the event the Trust Assets are not sufficient to
satisfy the Liabilities asserted against or payable out of the Fund’s available Trust Assets in the Trust.

 

2.4         Bill
of Sale, Assignment, Acceptance and Assumption Agreement; Instruments of Further Assurance. On the Effective Date, the Fund
and the Trust shall execute a Bill of Sale, Assignment, Acceptance and Assumption Agreement conveying the Fund Assets, Cash Reserves
and Liabilities to the Trust, a copy of which is attached as Exhibit A hereto. After the dissolution of the Fund, such Persons
who shall have the right and power to so act, will, upon reasonable request of the Managing Trustee, execute, acknowledge, and
deliver such further instruments and do such further acts as may be necessary or proper to carry out effectively the purposes of
this Agreement, to confirm or effectuate the transfer to the Managing Trustee of any property intended to be covered hereby, and
to vest in the Managing Trustee, its successors and assigns, the estate, powers, instruments or funds in trust hereunder.

 

2.5          Incidents
of Ownership. The holders of Fund Units as of the Record Date shall be the Initial Beneficiaries of the Trust as holders of
Trust Units in the Trust, and the Managing Trustee shall retain only such incidents of legal ownership as are necessary to undertake
the actions and transactions authorized herein.

 

2.6          Notice
to Unlocated Holders of Fund Units. If the Trust holds Trust Assets for the benefit of unlocated holders of any Fund Units,
due notice shall be given to such unlocated holders of Fund Units in accordance with California law, as applicable.

 

Article
III

BENEFICIARIES

 

3.1         Beneficial
Interests.

 

(a)          The
Beneficial Interest of each Initial Beneficiary hereof shall be determined by the Fund in accordance with the Fund’s list
of Fund Unit holders as of the Record Date (the “List”). The Fund will deliver the List to the Managing Trustee
promptly after the Record Date specifying the Fund Units of each Member in the Fund. Each Fund Unit owned by a Member shall be
converted into Beneficial Interests in the Trust. For ease of administration, the List shall express the Beneficial Interest of
each Initial Beneficiary in terms of units and it is intended that each unit shall represent one Trust Unit in the Trust.

 

(b)          In
the case of the Fund Unit holders, book-entry or other records or any other evidence of ownership satisfactory to the Managing
Trustee will be deemed to evidence the Beneficial Interest in the Trust of each such Beneficiary.

 

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(c)          If
any conflicting claims or demands are made or asserted with respect to the ownership of any Trust Units, or if there should be
any disagreement between the transferees, assignees, heirs, representatives or legatees succeeding to all or part of the interest
of any Beneficiary resulting in adverse claims or demands being made in connection with such Trust Units, then, in any of such
events, the Managing Trustee shall be entitled, at its sole election, to refuse to comply with any such conflicting claims or demands.
In so refusing, the Managing Trustee may elect to make no payment or distribution with respect to such Trust Units, or to make
such payment to a court of competent jurisdiction or an escrow agent, and in so doing the Managing Trustee shall not be or become
liable to any of such parties for their failure or refusal to comply with any of such conflicting claims or demands, nor shall
the Managing Trustee be liable for interest on any funds which it may so withhold. The Managing Trustee shall be entitled to refrain
and refuse to act until either (i) the rights of the adverse claimants have been adjudicated by a final non-appealable judgment
of a court of competent jurisdiction, (ii) all differences have been adjusted by valid written agreement between all of such
parties, and the Managing Trustee shall have been furnished with an executed counterpart of such agreement, or (iii) there
is furnished to the Managing Trustee a surety bond or other security satisfactory to the Managing Trustee, as it shall deem appropriate,
to fully indemnify it as between all conflicting claims or demands.

 

3.2         Rights
of Beneficiaries. Each Beneficiary shall be entitled to participate in the rights and benefits due to a Beneficiary hereunder
according to his Beneficial Interest. Each Beneficiary shall take and hold the same subject to all the terms and provisions of
this Agreement. The interest of the Beneficiary hereby is declared and shall be in all respects personal property and upon the
death of an individual Beneficiary, his Beneficial Interest shall pass as personal property to his legal representative and such
death shall in no way terminate or affect the validity of this Agreement, provided that the Managing Trustee shall not be required
to evidence a book entry transfer of a deceased Beneficiary’s Beneficial Interest to his legal representative until the Managing
Trustee shall have received Letters Testamentary or Letters of Administration and written notice of the death of the deceased Beneficiary.
A Beneficiary shall have no title or right to, or possession, management or control of, the Trust Assets except as herein expressly
provided. No widower, widow, heir, or devisee of any Person who may be a Beneficiary shall have any right of dower, homestead,
or inheritance, or of partition, or of any other right, statutory or otherwise, in any property forming a part of Trust Assets
but the whole title to the Trust Assets shall be vested in the Managing Trustee and the sole interest of the applicable Beneficiaries
shall be the rights and benefits given to such Persons under this Agreement.

 

3.3         No
Transfer of Interests of Beneficiaries. No Beneficial Interest may be transferred by any Beneficiary in person or by a duly
authorized agent or attorney, or by the properly appointed legal representatives of the Beneficiary. No Beneficiary has authority
or power to sell, assign, transfer, encumber, or in any other manner dispose of his Beneficial Interest; provided, however, that
the Beneficial Interest shall be assignable or transferable by will, intestate succession, or operation of law; further provided
that a Beneficiary shall be allowed to assign or transfer a Beneficial Interest held by a tax-qualified employee retirement plan
or account (including a regular IRA, a Keogh plan or a 401(k) plan) to the plan participant or account owner (or their beneficiaries),
but only if and to the extent that (x) a distribution from the plan or account is required to be made in order to satisfy the required
minimum distribution (“RMD”) provisions applicable to such plan or account, and (y) such RMD requirements cannot
be satisfied by distributing other assets from such plan or account, or from other accounts of such account owner; and further
provided, that the executor or administrator of the estate of a Beneficiary may mortgage, pledge, grant a security interest in,
hypothecate or otherwise encumber, the Beneficial Interest held by the estate of such Beneficiary if necessary in order to borrow
money to pay estate, succession or inheritance taxes or the expenses of administering the estate of the Beneficiary, upon written
notice to and upon written consent of the Managing Trustee, which consent may be withheld in the Managing Trustee’s sole
discretion.

 

Except as may be otherwise required
by law, the Beneficial Interests of the Beneficiaries hereunder shall not be subject to attachment, execution, sequestration or
any order of a court, nor shall such Beneficial Interests be subject to the contracts, debts, obligations, engagements or liabilities
of any Beneficiary, but the Beneficial Interest of a Beneficiary shall be paid by the Managing Trustee to the Beneficiary free
and clear of all assignments, attachments, anticipations, levies, executions, decrees and sequestrations and shall become the property
of the Beneficiary only when actually received by such Beneficiary.

 

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3.4         Managing
Trustee as Beneficiary. The Managing Trustee, either individually or in a representative or fiduciary capacity, may be a Beneficiary
to the same extent as if it were not a Managing Trustee hereunder and shall have all the rights of a Beneficiary, including, without
limitation, the right to vote and to receive distributions, to the same extent as if it were not the Managing Trustee hereunder.

 

Article
IV

DURATION
AND TERMINATION OF TRUST

 

4.1         Duration.
The existence of this Trust shall terminate upon the earliest of (i) a termination required by the applicable laws of the
State of California, (ii) the termination due to the distribution of all Trust Assets as provided in Section 5.6, or (iii) February
27, 2015, provided, however, that the Managing Trustee, in its discretion, may extend the existence of this Trust to such later
date as it may designate, if it determines that an extension is reasonably necessary to wind up the affairs of this Trust and,
if necessary, has requested and obtained additional no-action assurances from the staff of the U.S. Securities and Exchange Commission
(the “Commission”) regarding relief from registration and reporting requirements under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”) prior to any such extension.

 

4.2         Other
Obligations of the Managing Trustee upon Termination. Upon distribution of all the Trust Assets, the Managing Trustee shall
pay or make reasonable provision to pay all claims and obligations, including all contingent, conditional or unmatured claims and
obligations, known to the Trust, but for which the identity of the claimant is unknown and not known to the Trust, but based on
the facts known to the Trust, are likely to arise or to become known to the Trust within 10 years after the date of dissolution.
Except as otherwise specifically provided herein, upon the distribution of all Trust Assets in the Trust, the Managing Trustee
shall have no further duties or obligations hereunder.

 

Article
V

ADMINISTRATION
OF TRUST ASSETS

 

5.1          Sale
of Trust Assets. The Managing Trustee is hereby authorized and directed, at such times as it may deem appropriate, to transfer,
assign, or otherwise dispose of all or any part of the Trust Assets as it deems appropriate at public auction or at private sale
for cash, securities or other property, or upon credit (either secured or unsecured as the Managing Trustee shall determine, in
its sole discretion).

 

5.2          Authorized
Activities. The Trust and the Managing Trustee are hereby authorized to continue and engage in the conduct of any trade or
business on behalf of the Trust or the Beneficiaries and all of the terms and conditions hereof shall be construed accordingly.

 

5.3          Payment
of Claims, Expenses and Liabilities. Provided the Managing Trustee has been advised in writing with respect to such claims,
expenses, charges, liabilities and obligations, the Managing Trustee shall pay from the Trust Assets all claims, expenses, charges,
liabilities, and obligations of the Trust Assets and all Liabilities relating to the Trust Assets and obligations which the Managing
Trustee specifically assumes and agrees to pay pursuant to this Agreement and such transferee liabilities which the Managing Trustee
may be obligated to pay as transferee of the Trust Assets, including, without limitation, interest, penalties, taxes, assessments,
and public charges of every kind and nature and the costs, charges, and expenses connected with or growing out of the execution
or administration of this Trust and such other payments and disbursements as are provided in this Agreement or which may be determined
to be a proper charge against the Trust Assets by the Managing Trustee.

 

5.4          Interim
Distributions of Net Cash Flow from Operations. Subject to Sections 5.6 and 5.7, at such times as may be determined by it in
its sole discretion, the Managing Trustee shall distribute, or cause to be distributed, to the Beneficiaries such cash or other
property comprising a portion of the Trust Assets as the Managing Trustee may, in its sole discretion, determine may be distributed
without detriment to the conservation and protection of the Trust Assets in the Trust, as follows:

 

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(a)          Distributions
of Net Cash Flow from Operations of the Trust for any fiscal year will be made ninety percent (90%) to the Beneficiaries and ten
percent (10%) to the Managing Trustee until the “Unitholders’ 8% Preferred Return” is attained (pro rata among
the Beneficiaries in proportion to their Trust Units), commencing on the date such Beneficiary (or predecessor in interest) first
contributed capital to the Fund, and assuming for the purposes of this Section 5.4 that distributions of Net Cash Flow from Operations
include prior distributions of “Net Cash Flow from Operations” as defined under, and made pursuant to, the Fund Agreement,
that all distributions by the Fund to the Managing Member were paid to the Managing Trustee, that all distributions by the Fund
to the Members were paid to the Beneficiaries, and that during any period prior to the Effective Date, each Beneficiary’s
Invested Capital Contribution was his or her “Invested Capital Contribution” as defined under the Fund Agreement;

 

(b)          Thereafter,
distributions of Net Cash Flow from Operations shall be made one hundred percent (100%) to the Beneficiaries until the Early Investors’
12% Incentive Return is attained; and

 

(c)          Thereafter,
Distributions of Net Cash Flow from Operations shall be made fifty percent (50%) to the Beneficiaries (pro rata among the Beneficiaries
in proportion to their Trust Units) and fifty percent (50%) to the Managing Trustee.

 

5.5         Interim
Distributions of Net Sales Proceeds. Subject to Sections 5.6 and 5.7, at such times as may be determined by it in its sole
discretion, the Managing Trustee shall distribute, or cause to be distributed, to the Beneficiaries the Net Sales Proceeds, after
replenishment of any reserves, in the following order of priority:

 

(a)          First,
one hundred percent (100%) to the Beneficiaries in an amount equal to their Invested Capital Contributions, calculated at the time
of such Distribution (pro rata among the Unitholders in proportion to their Invested Capital Contributions) and assuming for the
purposes of this Section 5.5 that distributions of Net Sales Proceeds include prior distributions of “Net Sales Proceeds”
as defined under, and made pursuant to, the Fund Agreement, that all distributions by the Fund to the Managing Member were paid
to the Managing Trustee, that all distributions by the Fund to the Members were paid to the Beneficiaries, and that during any
period prior to the Effective Date, each Beneficiary’s Invested Capital Contribution was his or her “Invested Capital
Contribution” as defined under the Fund Agreement.;

 

(b)          Thereafter,
ninety percent (90%) to the Beneficiaries and ten percent (10%) to the Managing Trustee until the Beneficiaries have received distributions
in an amount equal to the unpaid balance of their aggregate Unitholders’ 8% Preferred Return (pro rata among the Unitholders
in proportion to their Trust Units); and

 

(c)          Thereafter,
fifty percent (50%) to the Beneficiaries (pro rata among the Unitholders in proportion to their Trust Units) and fifty percent
(50%) to the Managing Trustee.

 

5.6         Final
Distribution. If the Managing Trustee determines that (a) all of the real properties of the Trust have been sold, with the
proceeds from such sales and any amounts held in reserve for such properties distributed pursuant to Section 5.5, and all other
claims, expenses, charges, liabilities and obligations of the Trust have been paid or discharged, or (b) if the existence of the
Trust shall terminate pursuant to Section 4.1 hereof and not have been extended pursuant to such Section 4.1, then in the event
of (a) or (b) above Managing Trustee shall, consistent with the conservation and protection of the Trust Assets, expeditiously
make Liquidating Distributions to the Beneficiaries in accordance with the priorities set forth in Section 5.5
above. The Managing Trustee shall hold in the Trust and thereafter make disposition of all Liquidating Distributions and
other payments due any Beneficiaries who have not been located subject to applicable state laws regarding escheat and abandoned
property. It is understood that the Managing Trustee and the Beneficiary’s bank in any funds transfer may rely solely upon
any account numbers or similar identifying number provided by the parties hereto to identify (i) the Beneficiary, (ii) the
Beneficiary’s bank, or (iii) an intermediary bank. The Managing Trustee may apply any of the Trust Assets for any payment
order it executes using any such identifying number, even where its use may result in a person other than the Beneficiary being
paid, or the transfer of funds to a bank other than the Beneficiary’s bank, or an intermediary bank designated.

 

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5.7          Limitations
on Distributions. The Distributions to be made pursuant to this Article V are subject to the limitations of this Section 5.7.
Distributions may be made only if the Managing Trustee determines in its reasonable judgment that the Trust has sufficient cash
on hand exceeding the current and the anticipated needs of the Trust to fulfill its business purposes (including its needs for
operating expenses and reserves). No Distribution will be declared or made if, after giving it effect, the Fund would not be able
to pay its debts as they become due in the usual course of business or the fair market value of the Trust’s assets would
be less than the sum of its liabilities. All such Distributions to Beneficiaries shall be made only to the Persons who, according
to the books and records of the Trust, are the holders of record of the Trust Units in respect of which such Distributions are
made on the actual date of Distribution. Neither the Trust nor the Managing Trustee shall incur any liability for making Distributions
in accordance with this Article V.

 

5.8         Reports
to Beneficiaries and Others. As soon as practicable after the end of each taxable year of the Trust on a timeline as though
the Trust were a non-accelerated filer thereunder, the Managing Trustee shall file an annual report under cover of Form 10-K with
the Commission showing the assets and liabilities of the Trust at the end of each calendar year and the receipts and disbursements
of the Managing Trustee with respect to the Trust for such period covered by the report. The annual report will also describe the
changes in the assets of the Trust and the actions taken by the Managing Trustee during such period covered by the report. The
financial statements contained with in such annual report need not be audited but will be prepared on a liquidation basis in accordance
with generally accepted accounting principles The Managing Trustee will also file periodic reports under cover of Form 8-K with
the Commission whenever an event occurs for which a Form 8-K would have been required to be filed for the Trust or whenever, in
the opinion of the Managing Trustee, any other material event relating to the Trust or its assets has occurred. The taxable year
of the Trust shall end on December 31 of each year unless the Managing Trustee deems it advisable to establish some other date
as the date on which the taxable year of the Trust shall end.

 

5.9          Federal
Income Tax Information. Within seventy-five (75) days after the end of each fiscal year (in the event of a calendar taxable
year of the Trust, or within one hundred twenty (120) days thereafter in the event the Trust has changed to a non-calendar taxable
year), the Managing Trustee shall direct its agent to mail to each Person who was a Beneficiary at the close of the year, a schedule
K-1 stating the Beneficiary’s share of taxable income and tax deductions. In addition, after receipt of a good faith written
request, or in its discretion without such request or if required by applicable law, such agent (or if it cannot, the Managing
Trustee) shall furnish to any Person who has been a Beneficiary at any time during the preceding year a statement containing such
further information as is reasonably available to the agent or Managing Trustee, respectively, which shall be helpful in determining
the amount of taxable income which such Person should include in such Person’s federal income tax return for such preceding
taxable year.

 

5.10       Employment
of Manager.

 

(a)          The
Managing Trustee shall conduct the affairs of the Trust, devoting such time thereto as it, in its sole discretion, shall determine
to be necessary to manage Trust affairs in an efficient manner. The Managing Trustee shall have the power to appoint, employ or
contract with any Person or Persons as the Managing Trustee may deem necessary or proper for the transaction of the activities
of the Trust, including the Manager. The Managing Trustee may grant or delegate such authority to the Manager as the Managing Trustee
may in its sole discretion deem necessary or desirable to carry out the purpose of the Trust without regard to whether such authority
is normally granted or delegated by trustees.

 

(b)          The
Manager or other Persons shall not be required to administer the Trust as its sole and exclusive function and may have other business
interests and may engage in other activities similar or in addition to those relating to the Trust, including the rendering of
advice or services of any kind to investors or any other Persons and the management of other investments.

 

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Article
VI

MANAGING
TRUSTEE

 

6.1          General
Powers of the Managing Trustee. The Managing Trustee shall have the power to enter into or engage in any trade or business
on behalf of the Trust and the Beneficiaries, and may use, hold, or dispose of any Trust Asset in the furtherance of such trade
or business, including the power to make additional investments (to the extent of available cash) in debt or equity securities.

 

6.2          Specific
Powers of the Managing Trustee. In addition to the provisions of Section 6.1, the Managing Trustee shall have the following
specific powers in addition to any powers conferred upon it by any other Section or provision of this Agreement or any statutory
laws of the State of California; provided, however, that the enumeration of the following powers shall not be considered in any
way to limit or control the power of the Managing Trustee to act as specifically authorized by any other Section or provision of
this Agreement and to act in such a manner as the Managing Trustee may deem necessary or appropriate to conserve and protect any
Trust Assets or to confer on the Beneficiaries the benefits intended to be conferred upon them by this Agreement:

 

(a)          To
determine the nature and amount of the consideration to be received with respect to the sale or other disposition of, or the grant
of interests in, any Trust Assets.

 

(b)          To
collect, liquidate or otherwise convert into cash, or such other property as the Managing Trustee deems appropriate, all property,
assets and rights in any Trust Assets, and to pay, discharge and satisfy all other claims, expenses, charges, liabilities, and
obligations existing with respect to any Trust Assets, the Trust or the Managing Trustee.

 

(c)          To
elect, appoint, engage, retain or employ any Persons as agents, representatives, employees, or independent contractors (including,
without limitation, real estate advisors, investment advisors, accountants, transfer agents, custodians, attorneys-at-law, property
managers, appraisers, brokers, or otherwise) in one or more capacities, and to pay compensation from the Trust Assets for services
in as many capacities as such Person may be so elected, appointed, engaged, retained or employed, to prescribe the titles, powers
and duties, terms of service and other terms and conditions of the election, appointment, engagement, retention or employment of
such Persons and, except as prohibited by law, to delegate any of the powers and duties of the Managing Trustee to any one or more
Trustees, Managers, agents, representatives, employers, independent contractors or other Persons.

 

(d)          To
retain and set aside such funds out of the Trust as the Managing Trustee shall deem necessary or expedient to pay, or provide for
the payment of (i) unpaid claims, expenses, charges, liabilities, and obligations of the Trust or the Fund, except to the
extent that liabilities for which the Fund has previously reserved Cash Reserves are satisfied with funds from said Cash Reserves;
(ii) contingencies; and (iii) the expenses of administering the Trust Assets.

 

(e)          To
do and perform any and all acts necessary or appropriate for the conservation and protection of the Trust Assets, including acts
or things necessary or appropriate to maintain Trust Assets held by the Managing Trustee pending sale or other disposition thereof
or distribution thereof to the Beneficiaries.

 

(f)          To
hold legal title to property of the Trust in the name of the Trust, or in the name of the Managing Trustee, or of any other Person,
without disclosure of the interest of the Trust therein.

 

(g)          To
cause any investments of any part of the Trust Assets to be registered and held in the name of any one or more of its names or
in the names of a nominee or nominees without increase or decrease of liability with respect thereto.

 

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(h)          To
institute or defend actions or declaratory judgments or other actions and to take such other action, in the name of the Trust or
the Fund or as otherwise required, as the Managing Trustee may deem necessary or desirable to enforce any instruments, contracts,
agreements, causes of action, claims or rights relating to or forming a part of the Trust Assets.

 

(i)          To
determine conclusively from time to time the value of and to revalue the securities and other property of the Trust, in accordance
with independent appraisals or other information as it deems necessary or appropriate.

 

(j)          To
cancel, terminate, or amend any instruments, contracts, agreements, obligations or causes of action relating to or forming a part
of any Trust Assets, and to execute new instruments, contracts, agreements, obligations or causes of action notwithstanding that
the terms of any such instruments, contracts, agreements, obligations or causes of action may extend beyond the terms of this Trust.

 

(k)          To
vote by proxy or otherwise on behalf of the Beneficiaries and with full power of substitution all shares of stock and all securities
held by the Managing Trustee hereunder and to exercise every power, election, discretion, option and subscription right and give
every notice, make every demand, and to do every act or thing in respect to any shares of stock or any securities held by the Managing
Trustee which the Managing Trustee might or could do if the Managing Trustee was the absolute owner thereof.

 

(l)          To
undertake or join in any merger, plan of reorganization, consolidation, liquidation, dissolution, readjustment or other transaction
of any corporation, any of whose shares of stock or other securities, obligations, or properties may at any time constitute a part
of any Trust Assets, and to accept the substituted shares of stock, bonds, securities, obligations and properties and to hold the
same in trust in accordance with the provisions hereof.

 

(m)          In
connection with the sale or other disposition or distribution of any securities held by the Managing Trustee, to comply with the
applicable federal and state securities laws, and to enter into agreements relating to the sale or other disposition or distribution
thereof.

 

(n)          To
authorize transactions between corporations or other entities whose securities, or other interests therein (either in the nature
of debt or equity) are held by the Managing Trustee as part of any Trust Assets.

 

(o)          To
terminate and dissolve any entities owned by the Trust.

 

(p)          To
have a judicial settlement of its account of the Trust at any time to the extent it determines necessary or advisable.

 

(q)          To
perform any act authorized, permitted, or required under any instrument, contract, agreement, right, obligation or cause of action
relating to or forming a part of any Trust Assets whether in the nature of an approval, consent, demand or notice thereunder or
otherwise, unless such act would require the consent of the Beneficiaries in accordance with the express provisions of this Agreement.

 

6.3         Compensation
and Expense Reimbursement. The Managing Trustee and/or its Affiliates shall be entitled to receive the following compensation
and expense reimbursements:

 

(a)          Reimbursement
of actual cost of goods and materials and services necessary to the prudent operation of the Trust which are supplied to the Trust
by the Managing Trustee but not in excess of the cost that the Trust would pay an unaffiliated third party for such goods, materials
or services, provided, however, that the Trust will not reimburse the Managing Trustee or its Affiliates for the general overhead
of the Managing Trustee or its Affiliates;

 

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(b)          Property
management fees of no more than six percent (6%) of the gross income generated by the Trust from gross rental income generated
by the Trust Assets;

 

(c)          Leasing
commissions paid upon execution of new and renewal leases equal to six percent (6%) of rent scheduled to be paid during the first
and second year of the lease, five percent (5%) during the third and fourth years and four percent (4%) during the fifth and later
years;

 

(d)          Construction
supervision fee equal to ten percent (10%) of the cost of tenant improvements and capital improvements to the Trust Assets;

 

(e)          Distribution
of a portion of Net Cash Flow from Operations in accordance with Section 5.4;

 

(f)           Property
disposition fees equal to six percent (6%) of the contract sales price of the Trust Assets sold by the Managing Trustee and/or
its Affiliates pursuant to a non-exclusive arrangement; and

 

(g)         Distribution
of a portion of the Net Sales Proceeds in accordance with Section 5.5.

 

6.4         Contracts
with the Managing Trustee and its Affiliates. Any agreements, contracts and arrangements with the Managing Trustee or its Affiliates
permitted hereunder shall be subject to the following conditions: (i) any such agreements, contracts or arrangements, other than
for property leasing services, property management services, construction supervision services or property disposition services
provided for in Sections 6.3(b), 6.3(c), 6.3(d) and 6.3(f) of this Agreement, shall be embodied in a written contract which describes
the services to be rendered and all compensation to be paid; (ii) the compensation, price or fee must be competitive with the compensation
price or fee of any non-affiliate which could render comparable services or sell or lease comparable goods on competitive terms
to the Trust; (iii) any such agreements, contracts or arrangements shall be fully and promptly disclosed to all Beneficiaries in
the reports made available pursuant to Section 5.8; (iv) any such agreements, contracts or arrangements other than for Property
leasing services, Property management services, construction supervision services or Property disposition services provided for
in Sections 6.3(b), 6.3(c), 6.3(d) and 6.3(f) of this Agreement shall be terminable by a majority in Beneficial Interest of the
Beneficiaries, without penalty, upon not more than sixty (60) days’ prior written notice; (v) the Managing Trustee or its
Affiliate must be previously and independently engaged in the business of rendering the services or selling or leasing the goods
to be provided, as an ordinary and ongoing business; and (vi) goods or services other than for property leasing services, property
management services, construction supervision services or property disposition services provided for in Sections 6.3(b), 6.3(c),
6.3(d) and 6.3(f) of this Agreement shall be provided by the Managing Trustee only in extraordinary circumstances.

 

6.5          Fiduciary
Duty; Standard of Care. The Managing Trustee shall have fiduciary responsibility for the safekeeping and use of all funds and
assets of the Trust, whether or not in the Managing Trustee’s possession or control. The Managing Trustee shall not employ,
or permit another to employ such funds or assets in any manner except for the exclusive benefit of the Trust. Each person appointed
by the Managing Trustee to perform duties for the Trust will discharge his or her duties in good faith, with the care an ordinarily
prudent person in a like position would exercise under similar circumstances, and in a manner he or she reasonably believes to
be in the best interests of the Trust.

 

6.6          Rebates,
Give-ups and Reciprocal Arrangements. No rebates or give-ups may be received by the Managing Trustee or its Affiliates nor
may the Managing Trustee or its Affiliates participate in any reciprocal business arrangements which would circumvent the provisions
of this Agreement.

 

6.7          Other
Compensation. Other than as specifically provided in this Agreement, neither the Managing Trustee nor its Affiliates shall
be compensated for services rendered to the Trust. The Managing Trustee and its Affiliates cannot receive any fees or other compensation
from the Trust except as specifically provided for in this Agreement.

 

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Article
VII

CONCERNING
THE MANAGING TRUSTEE, BENEFICIARIES, EMPLOYEES AND AGENTS

 

7.1         Generally.
The Managing Trustee accepts and undertakes to discharge the Trust created by this Agreement, upon the terms and conditions thereof
on behalf of the Beneficiaries. The Managing Trustee shall exercise such rights and powers vested in it by this Agreement, and
use the same degree of care and skill in its exercise as a prudent man would exercise or use under the circumstances in the conduct
of his own affairs. No provision of this Agreement shall be construed to relieve the Managing Trustee from liability for its own
willful misconduct, knowingly and intentionally committed in bad faith, except that:

 

(a)          No
successor Managing Trustee shall be in any way responsible for the acts or omissions of the Managing Trustee in office prior to
the date on which it became a Managing Trustee.

 

(b)          The
Managing Trustee shall not be liable for the performance of such duties and obligations as are specifically set forth in this Agreement
except for its fraud, willful misconduct or gross negligence, and no implied covenants or obligations shall be read into this Agreement
against the Managing Trustee.

 

(c)          The
Managing Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Managing Trustee and conforming to the requirements of this Agreement.

 

(d)          The
Managing Trustee shall not be liable for any act which the Managing Trustee may do or omit to do hereunder, or for any mistake
of fact or law, or for any error of judgment, or for the misconduct of any employee, agent, representative or attorney appointed
by it, or for anything that it may do or refrain from doing in connection with this Agreement while acting in good faith and in
a manner he, she or it reasonably believed to be in or not opposed to the best interests of the Trust or its Beneficiaries; and
whose actions did not breach such Person’s fiduciary duties to the Trust and whose actions did not constitute fraud, willful
misconduct or gross negligence, and with respect to a criminal action or proceeding, if the Person had no reasonable cause to believe
his, her or its conduct was unlawful.

 

(e)          The
duties and obligations of the Managing Trustee shall be limited to and determined solely by the express provisions of this Agreement,
and no implied duties or obligations shall be read into this Agreement against the Managing Trustee.

 

7.2         Reliance
by the Managing Trustee. Except as otherwise provided in Section 7.1 of this Agreement:

 

(a)          The
Managing Trustee may rely and shall be protected in acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, order, or other paper or document believed by it to be genuine and to have been signed or presented by
the proper party or parties.

 

(b)          The
Managing Trustee may consult with legal counsel, auditors or other experts to be selected by it, including firms with which the
Managing Trustee may be an Affiliate, and the advice or opinion of such counsel, accountants, auditors or other experts shall be
full and complete protection to the Managing Trustee, the employees and the agents of the Managing Trustee in respect of any action
taken or omitted or suffered by them in good faith and in reliance on, or in accordance with, such advice or opinion.

 

(c)          Persons
dealing with the Managing Trustee shall look only to the Trust Assets to satisfy any liability incurred by the Managing Trustee
to such Person in carrying out the terms of this Agreement, and the Managing Trustee shall have no personal obligation to satisfy
any such liability.

 

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(d)          As
far as practicable and except as expressly permitted above, the Managing Trustee shall cause any written instrument creating an
obligation of the Trust to include a reference to this Agreement and to provide that neither the Beneficiaries, the Managing Trustee
nor their agents shall be liable thereunder and that the other parties to such instrument shall look solely to the Trust Assets
for the payment of any claim thereunder or the performance thereof; provided, however, that the omission of such provision from
any such instrument shall not render the Beneficiaries, the Managing Trustee, or their agents liable, nor shall the Managing Trustee
be liable to anyone for such omission.

 

7.3         Limitation
on Liability to Third Persons. No Beneficiary shall be subject to any personal liability whatsoever, in tort, contract or otherwise,
to any Person in connection with the Trust Assets or the affairs of the Trust; and neither the Managing Trustee nor any employee
or agent of the Trust shall be subject to any personal liability whatsoever, in tort, contract or otherwise, to any Person in connection
with any Trust Assets or the affairs of the Trust, except for such Person’s own willful misconduct, knowingly and intentionally
committed in bad faith; and all such other Persons shall look solely to any Trust Assets for satisfaction of claims of any nature
arising in connection with the affairs of the Trust. The Managing Trustee shall purchase and maintain insurance as it deems reasonably
necessary for the protection of all Trust Assets, its Beneficiaries, the Trustee and its employees and agents in such amount as
the Managing Trustee shall deem adequate to cover all foreseeable liability to the extent available at reasonable rates.

 

7.4         Recitals.
Any written instrument creating an obligation of the Trust shall be conclusively taken to have been executed or done by the Managing
Trustee, or the employee or agent of this Trust only in its capacity as Managing Trustee under this Agreement or in its capacity
as employee or agent of the Trust.

 

7.5         Indemnification.

 

(a)          Subject
to all of the provisions of this Section 7.5, the Trust shall indemnify a Person who was or is a party or is threatened to be made
a party to a threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative
and whether formal or informal, other than an action by or in the right of the Trust, by reason of the fact that he, she or it
is or was a Managing Trustee of the Trust, or is or was serving at the request of the Trust as a director, officer, partner, trustee,
employee or agent of another foreign or domestic limited liability company, corporation, partnership, joint venture, trust or other
enterprise, whether for profit or not, against expenses, including attorneys’ fees, judgments, penalties, fines and amounts
paid in settlement actually and reasonably incurred by him, her or it in connection with the action, suit or proceeding, if the
Person acted in good faith and in a manner he, she or it reasonably believed to be in or not opposed to the best interests of the
Trust or its Beneficiaries, did not breach such Person’s fiduciary duties to the Trust and whose actions did not constitute
fraud, willful misconduct or gross negligence, and with respect to a criminal action or proceeding, if the Person had no reasonable
cause to believe his, her or its conduct was unlawful.  The termination of an action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent, does not, itself, create a presumption that the Person
did not act in good faith and in a manner which he, she or it reasonably believed to be in or not opposed to the best interests
of the Trust or its Beneficiaries, and, with respect to a criminal action or proceeding, had reasonable cause to believe that his,
her or its conduct was not unlawful.

 

(b)          Indemnification
shall not be made to a Person for a claim, issue, or matter in which the Person has been found liable to the Trust unless and only
to the extent that the court in which the action or suit was brought has determined upon application that, despite the adjudication
of liability but in view of all circumstances of the case, the Person is fairly and reasonably entitled to indemnification for
the expenses which the court considers proper.

 

(c)          To
the extent that a Person has been successful on the merits or otherwise in defense of an action, suit, or proceeding referred to
in Sections 7.5(a) or 7.5(b) of this Agreement, or in defense of a claim, issue or matter in the action, suit, or proceeding, he,
she or it shall be indemnified against expenses, including actual and reasonable attorneys’ fees, incurred by him, her or
it in connection with the action, suit or proceeding and an action, suit, or proceeding brought to enforce the mandatory indemnification
provided in this Section 7.5.

 

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(d)          An
indemnification under Sections 7.5(a) or 7.5(b) of this Agreement, unless ordered by a court, shall be made by the Trust only as
authorized in the specific case upon a determination that indemnification of the Person is proper in the circumstances because
he, she or it has met the applicable standard of conduct set forth in Sections 7.5(a) or 7.5(b), whichever is applicable. 
Determination that indemnification is proper shall be made as follows:

 

(1)         For
the indemnification of the Managing Trustee, such determination shall be made only if all of the following conditions shall be
satisfied:

 

a.            The
Managing Trustee has determined, in good faith, that the course of conduct which caused the loss or liability was in the best interests
of the Fund.

 

b.            Such
liability or loss was not the result of fraud, gross negligence or willful misconduct by the Managing Trustee.

 

c.            Such
indemnification or agreement to hold harmless is recoverable only out of the assets of the Trust and not from the Beneficiaries.

 

d.            Such
determination shall be made in either of the following ways: (A) by independent legal counsel in a written opinion; or (B) by the
Beneficiaries pursuant to Article X.

 

e.            If
and only to the extent prohibited by applicable law, indemnification will not be allowed on any liability imposed by judgment,
and costs associated therewith, including attorneys’ fees, arising from or out of a violation of state or federal securities
laws associated with the offer and sale of the Fund’s Units.  Indemnification will be allowed for settlements and related
expenses of lawsuits alleging securities law violations, and for expenses incurred in successfully defending such lawsuits if (1)
there has been a successful adjudication of the merits of each count involving alleged securities law violations as to the indemnitee
or (2) the claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the indemnitee or
(3) a court of competent jurisdiction approves the settlement of the claims against the indemnitee and finds that indemnification
of the settlement and related costs should be made and prior to seeking such approval, the court has been apprised that the California
Commissioner of Corporations and the Securities and Exchange Commission believes that indemnification for violations of securities
law violates the California Corporate Securities Law of 1968 and the Securities Act of 1933 and is against public policy and therefore
unenforceable.

 

(2)         For
the indemnification of all Persons other than the Managing Trustee, such determination shall be made in any of the following ways:
(A) by the Managing Trustee provided the Managing Trustee was not a party to the action, suit or proceeding; (B) by independent
legal counsel in a written opinion; or (C) by the Beneficiaries pursuant to Article X.

 

(e)          If
a Person is entitled to indemnification under Sections 7.5(a) or 7.5(b) of this Agreement for a portion of expenses including attorneys’
fees, judgments, penalties, fines and amounts paid in settlement, but not for the total amount thereof, the Trust may indemnify
the Person for the portion of the expenses, judgments, penalties, fines or amounts paid in settlement for which the Person is entitled
to be indemnified.

 

    	15

    	 

    

 

(f)           Expenses
incurred in defending a civil or criminal action, suit or proceeding described in Sections 7.5(a) or 7.5(b) of this Agreement may
be paid by the Trust in advance of the final disposition of the action, suit or proceeding upon receipt of an undertaking by or
on behalf of the Person involved to repay the expenses if it is ultimately determined that the Person is not entitled to be indemnified
by the Fund and, in the event of an action initiated by a Beneficiary or a third party, provided a court of competent jurisdiction
specifically approves such advance.  The undertaking shall be by unlimited general obligation of the Person on whose behalf
advances are made but need not be secured.

 

(g)          The
Trust may, to the extent authorized from time to time by the Managing Trustee, grant rights to indemnification and to the advancement
of expenses to any employee or agent of the Trust to the fullest extent of the provisions of this Section 7.5(a) with respect to
the indemnification and advancement of expenses of the Managing Trustee and officers of the Fund.

 

(h)          The
indemnification provided in the foregoing sections of this Section 7.5 continues as to a Person who has ceased to be a Managing
Trustee, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such Person.

 

(i)           The
Trust may purchase and maintain insurance on behalf of any Person who is or was a Managing Trustee, officer, employee or agent
of the Trust, or who is or was serving at the request of the Trust as a director, officer, employee or agent of another limited
liability company, corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such
Person and incurred by such Person in any such capacity or arising out of such Person’s status as such, whether or not the
Fund would have power to indemnify such Person against such liability under this Agreement or the laws of the State of California. 
The Trust will not incur the cost of that portion of liability insurance which insures the Managing Trustee for any liability for
which the Fund is prohibited from indemnifying the Managing Trustee.

 

(j)           The
right to indemnification conferred in this Section 7.5 shall be a contract right, and shall apply to services of a Managing Trustee
or officer as an employee or agent of the Trust as well as in such Person’s capacity as a Managing Trustee or officer. 
Except as provided in Section 7.5(d) of this Agreement, the Trust shall have no obligations under this Section 7.5 to indemnify
any Person in connection with any proceeding, or part thereof, initiated by such Person without authorization by the Managing Trustee.

 

(k)          The
indemnification or advancement of expenses provided under this Section 7.5 is not exclusive of other rights to which a Person seeking
indemnification or advancement of expenses may be entitled under a contractual arrangement with the Trust.  However, the total
amount of expenses advanced or indemnified from all sources combined shall not exceed the amount of actual expenses incurred by
the Person seeking indemnification or advancement of expenses.

 

(l)            No
amendment or deletion of this Section 7.5 shall apply to or have any effect on any Managing Trustee or officer of the Trust for
or with respect to any acts or omissions of any such Person occurring prior to such amendment or repeal.

 

7.6          Rights
of Managing Trustees, Employees, Independent Contractors and Agents to Own Trust Units or Other Property and to Engage in Other
Business. Any Managing Trustee, employee, independent contractor or agent, including the Manager, may own, hold and dispose
of Trust Units for its individual account, and may exercise all rights thereof and thereunder to the same extent and in the same
manner as if it were not a Managing Trustee, employee, independent contractor or agent. Any Managing Trustee, employee, independent
contractor or agent, including the Manager, may, in its personal capacity or in the capacity of trustee, manager, officer, director,
shareholder, partner, member, advisor, employee of any Person or otherwise, have business interests and holdings similar to or
in addition to those relating to the Trust. Any Managing Trustee, employee, independent contractor or agent of the Trust, including
the Manager, may be a trustee, manager, officer, director, shareholder, partner, member, advisor, employee or independent contractor
of, or otherwise have a direct or indirect interest in, any Person who may be engaged to render advice or services to the Trust,
and may receive compensation from such Person as well as compensation as Trustee, employee, independent contractor or agent, including
as Manager, or otherwise hereunder so long as such interest is disclosed to the Managing Trustee. None of these activities in and
of themselves shall be deemed to conflict with its duties as Managing Trustee, employee, independent contractor or agent, including
as Manager.

 

    	16

    	 

    

 

Article
VIII

THE
MANAGING TRUSTEE AND SUCCESSOR MANAGING TRUSTEE

 

8.1          Number
and Qualification of Managing Trustees. Subject to the provisions of Section 8.3 of the Agreement relating to the period pending
the appointment of a successor Managing Trustee, there shall be one Managing Trustee of this Trust, which shall be a citizen and
resident of or a corporation or other entity which is incorporated or formed under the laws of a state of the United States. The
number of Managing Trustees may be increased or decreased from time to time by the Managing Trustee.

 

If any entity Managing Trustee shall
change its name, or shall reorganize or reincorporate, or shall merge with or into or consolidate with any other entity such entity
Managing Trustee shall be deemed to be a continuing entity and shall continue to act as a Managing Trustee hereunder with the same
liabilities, duties, powers, titles, discretions and privileges as are herein specified for a Managing Trustee.

 

8.2          Resignation
and Removal. Except as otherwise provided in this Section 8.2, until the dissolution of the Trust, the Managing Trustee shall
not take any voluntary step to dissolve itself or to resign as Managing Trustee. The Managing Trustee shall have the right to resign
voluntarily as Managing Trustee or to dissolve itself with the concurrence of the Beneficiaries by a Majority Vote; provided, however,
that the Managing Trustee may, without the consent of the Beneficiaries, to the extent permitted by law, substitute in its stead
as Managing Trustee any entity which has, by merger, consolidation or otherwise, acquired substantially all of such Managing Trustee’s
assets, stock or other evidence of equity interest and continued its business. Any Managing Trustee may be removed only upon the
Majority Vote of Beneficiaries. All obligations of the Managing Trustee hereunder shall cease and terminate on the effective date
of its resignation or removal and its sole responsibility thereafter shall be to hold the Trust Assets for a period of thirty (30)
calendar days following the effective date of resignation or removal, at which time, if a successor Managing Trustee shall have
been appointed and have accepted such appointment in a writing to the Beneficiaries, then upon written notice thereof given by
the successor Managing Trustee to the resigning Managing Trustee, the resigning Managing Trustee shall deliver the Trust Assets
to the successor Managing Trustee. If a successor Managing Trustee shall not have been appointed within a thirty (30) day period
from the predecessor Managing Trustee’s resignation or removal, for any reason whatsoever, the resigning Managing Trustee
shall deliver the Trust Assets to a court of competent jurisdiction in the county in which the Trust Assets are there being held
and give written notice of the same to the parties hereto.

 

The resigning Managing Trustee shall
be entitled to payment of any unpaid fees (which shall be pro-rated as of the effective date of the resignation or removal) and
expenses and to reimbursement by the Beneficiaries out of the Trust Assets for any expenses incurred in connection with the transfer
of the Trust Assets pursuant to and in accordance with the provisions of this Section 8.2 of this Agreement.

 

8.3          Appointment
of Successor. Should at any time a Managing Trustee resign or be removed, unless any remaining Managing Trustees shall decrease
the number of Managing Trustees of the Trust pursuant to Section 8.1 hereof, a vacancy shall be deemed to exist and a successor
shall be appointed by any remaining Managing Trustees. If there are no remaining Managing Trustees, the Beneficiaries may, pursuant
to Article X hereof, call a meeting to appoint a successor Managing Trustee upon the Majority Vote of Beneficiaries. If such a
vacancy is not filled by any remaining Managing Trustees within ninety (90) days, the remaining Managing Trustees must notify the
Beneficiaries of their inability to fill such vacancy, and the Beneficiaries may, pursuant to Article X hereof, call a meeting
to appoint a successor Managing Trustee by a Majority Vote of Beneficiaries. Pending the appointment of a successor Managing Trustee,
the remaining Managing Trustee or Trustees then serving may take any action in the manner set forth in this Agreement.

 

    	17

    	 

    

 

8.4          Acceptance
of Appointment by Successor Managing Trustee. Any successor Managing Trustee appointed hereunder shall execute an instrument
accepting such appointment hereunder. Thereupon such successor Managing Trustee shall, without any further act, become vested with
all the estates, properties, rights, powers, trusts and duties of his or its predecessor in the Trust hereunder with like effect
as if originally named therein.

 

8.5          Bonds.
No bond shall be required of the original Managing Trustee hereunder, and no bond shall be required of any successor Managing Trustee
hereunder. If a bond is required by law, no surety or security with respect to such bond shall be required unless required by law.

 

Article
IX

CONCERNING
THE BENEFICIARIES

 

9.1          Evidence
of Action by Beneficiaries. Whenever in this Agreement it is provided that the Beneficiaries may take any action (including
the making of any demand or request, the giving of any notice, consent, or waiver, the removal of a Trustee, the appointment of
a successor Trustee, or the taking of any other action), the fact that at the time of taking any such action such Beneficiaries
have joined therein may be evidenced (i) by any instrument or any number of instruments of similar tenor executed by Beneficiaries
in person or by agent or attorney appointed in writing, or (ii) by the record of the Beneficiaries voting in favor thereof
at any meeting of Beneficiaries duly called and held in accordance with the provisions of Article X of this agreement. Such meeting
or writing may take any form permitted under California law.

 

9.2          Limitation
on Suits by Beneficiaries. No Beneficiary shall have any right by virtue of any provision of this Agreement to institute any
action or proceeding at law or in equity against any party other than the Trustees upon or under or with respect to any Trust Assets
or the agreements relating to or forming part of any Trust Assets, and the Beneficiaries do hereby waive any such right.

 

9.3          Requirement
of Undertaking. The Managing Trustee may request any court to require, and any court may in its discretion require, in any
suit for the enforcement of any right or remedy under this Agreement, or in any suit against the Managing Trustee for any action
taken or omitted by it as Managing Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of
such suit, and such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees, against any
party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant;
provided, however, that the provisions of this Section shall not apply to any suit by the Managing Trustee.

 

Article
X

MEETING
OF BENEFICIARIES

 

10.1        Meetings
of Beneficiaries. Meetings of all Beneficiaries may be called by the Managing Trustee and shall be called upon the written
request to the Managing Trustee of Beneficiaries holding in the aggregate at least a majority of the Beneficial Interests owned
by all Beneficiaries. The request shall state the purpose or purposes for which the meeting is to be called.

 

10.2       Purpose
of Meetings. A meeting of the Beneficiaries may be called at any time and from time to time pursuant to the provisions of this
Article for the purposes of taking any action which the terms of this Agreement permit a Beneficiary having a specified aggregate
Beneficial Interest to take either acting alone or with the Managing Trustee.

 

10.3       Place
of Meetings. All meetings of the Beneficiaries shall be held at the principal office of the Trust or at such other place as
shall be determined by the Managing Trustee and stated in the notice of meeting.

 

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10.4        Notice
of Meetings.  In the case of a meeting requested by Beneficiaries holding at least a majority in the aggregate of the
Beneficial Interests owned by all Beneficiaries, the notice shall be delivered to the Beneficiaries of the Trust within 10 business
days of receipt of such request.  Except as otherwise provided by statute, written notice of the time, place and purposes
of a meeting of Beneficiaries shall be given not less than 10 nor more than 60 days before the date of the meeting to each Beneficiary,
either personally or by mailing such notice to its last address as it appears on the books and records of the Trust.  The
notice must include a detailed statement of the action proposed, including a verbatim statement of the wording of any resolution
proposed for adoption by the Beneficiaries and of any proposed amendment to the Agreement. The Trust will provide for proxies or
written consents which specify a choice between approval and disapproval of each matter to be acted upon at the meeting. 
No notice need be given of an adjourned meeting provided the time and place to which such meeting is adjourned are announced at
the meeting at which the adjournment is taken and at the adjourned meeting only such business is transacted as might have been
transacted at the original meeting.  However, if after the adjournment a new record date is fixed for the adjourned meeting,
a notice of the adjourned meeting shall be given to each Beneficiary of record on the new record date entitled to notice as provided
in this Agreement.

 

10.5       Record
Dates.  The Managing Trustee may fix in advance a date as the record date for the purpose of determining Beneficiaries
entitled to notice of and to vote at a meeting of Beneficiaries or an adjournment thereof, or to express consent or to dissent
from a proposal without a meeting, or for the purpose of determining Beneficiaries entitled to receive payment of a Distribution
or allotment of a right, or for the purpose of any other action.  The date fixed shall not be more than 60 nor less than 20
days before the date of the meeting, nor more than 60 days before any other action.  In such case only such Beneficiaries
as shall be Beneficiaries of record on the date so fixed shall be entitled to notice of and to vote at such meeting or adjournment
thereof, or to express consent or to dissent from such proposal, or to receive payment of such Distribution or to receive such
allotment of rights, or to participate in any other action, as the case may be, notwithstanding any transfer of any Units on the
books of the Trust, or otherwise, after any such record date.

 

10.6       Quorum. 
Unless a greater or lesser quorum is required in the California law, the Beneficiaries present at a meeting in person or by proxy
who, as of the record date for such meeting, were holders of a majority of the Beneficial Interests held by all Beneficiaries shall
constitute a quorum at the meeting.  Whether or not a quorum is present, a meeting of Beneficiaries may be adjourned by a
vote of the Beneficiaries present in person or by proxy.

 

10.7       Proxies. 
A Beneficiary entitled to vote at a meeting of Beneficiaries or to express consent or dissent without a meeting may authorize other
Persons to act for such Beneficiary by proxy.  A proxy shall be signed by the Beneficiary or its authorized agent or representative
and shall not be valid after the expiration of one year from its date unless otherwise provided in the proxy.  A proxy is
revocable at the pleasure of the Beneficiary executing it except as otherwise provided by California law.

 

10.8        Inspectors
of Election.  The Managing Trustee, in advance of a Beneficiaries’ meeting, may, and on request of a Beneficiary
entitled to vote thereat shall, appoint one or more inspectors.  In case a Person appointed fails to appear or act, the vacancy
may be filled by appointment made by the Managing Trustee in advance of the meeting or at the meeting by the Person presiding thereat. 
If appointed, the inspectors shall determine the Beneficial Interests of all Beneficiaries represented at the meeting, the existence
of a quorum and the validity and effect of proxies, and shall receive votes, ballots or consents, hear and determine challenges
or consents, determine the result, and do such acts as are proper to conduct the election or vote with fairness to all Beneficiaries. 
On request of the person presiding at the meeting or a Beneficiary entitled to vote thereat, the inspectors shall make and execute
a written report to the Person presiding at the meeting of any of the facts found by them and matters determined by them. 
The report shall be prima facie evidence of the facts stated and of the vote as certified by the inspectors.

 

10.9        Actions
Without a Meeting.  Any action required or permitted to be taken at a meeting of the Beneficiaries may be taken without
a meeting, without prior notice, and without a vote, if consents in writing, setting forth the action so taken, are signed by the
number of Beneficiaries required to approve such action, but in no event less than a majority in Beneficial Interest of the Beneficiaries. 
Each written consent will bear the date and signature of each Beneficiary who signs the consent.

 

    	19

    	 

    

 

Article
XI

AMENDMENTS

 

11.1       Consent
of Beneficiaries. Upon the Majority Vote of Beneficiaries, or such greater percentage as shall be specified in this Agreement
for the taking of an action by the Beneficiaries under the affected provision of this Agreement, the Managing Trustee shall promptly
make and execute a declaration amending this Agreement for the purpose of adding any material provisions to or changing in any
material manner or eliminating any of the material provisions of this Agreement or amendments thereto as they apply to the Trust;
provided, however, that no such amendment shall affect the Beneficiaries’ rights to receive their pro rata shares of the
Trust Assets at the time of distribution; provided further, however, that, so long as such amendment has been approved by the Managing
Trustee, no consent of the Beneficiaries shall be required with respect to any amendment made (a) solely for the purpose of facilitating
the transferability by Beneficiaries of Trust Units, (b) to comply with applicable laws, including tax laws or to satisfy any requirements,
conditions, guidelines or opinions contained in any opinion, directive, order, ruling or regulation of the Commission, the Internal
Revenue Service or any other U.S. federal or state or non-U.S. governmental agency, compliance with which the Managing Trustee
deems to be in the best interest of the Beneficiaries as a whole, (c) to obtain no-action assurances from the staff of the Commission
regarding relief from registration and reporting requirements under the Exchange Act, which relief the Managing Trustee deems to
be in the best interest of the Beneficiaries as a whole, (d) to cause the Trust to be treated as a liquidating trust under Treasury
Regulation Section 301.7701-4(d) and any analogous provision of state or local law, if the Managing Trustee deems it to be in the
best interests of the Beneficiaries as a whole, or (e) to cure any ambiguity, to correct or supplement any provision herein which
may be inconsistent with any other provision herein, or to add any other provision with respect to matters or questions arising
under this Agreement which will not be inconsistent with the provisions of this Agreement.

 

Notwithstanding anything to the contrary
in this Agreement, this Agreement shall in no event be amended to change the limited liability of the Beneficiaries without the
vote or consent of all of the Beneficiaries, nor shall this Agreement be amended to diminish the rights or benefits to which any
of the Managing Trustee or Beneficiaries are entitled under the provisions of this Agreement, without the consent of all of the
Beneficiaries who would be adversely affected thereby, and in the case of the Managing Trustee being singularly affected, then
by the Managing Trustee.

 

11.2        Effect
of Amendment. Upon the execution of any such declaration of amendment by the Managing Trustee, this Agreement shall be deemed
to be modified and amended in accordance therewith and the respective rights, limitations of rights, obligations, duties, and immunities
of the Managing Trustee and the Beneficiaries under this Agreement with respect to the Trust shall thereafter be determined, exercised
and enforced hereunder subject in all respects to such modification and amendments, and all the terms and conditions of any such
amendment shall be thereby deemed to be part of the terms and conditions of this Agreement for any and all purposes.

 

11.3        Managing
Trustee’s Declining to Execute Documents. If, in the reasonable opinion of the Managing Trustee, any document required
to be executed pursuant to the terms of Section 14.2 hereof adversely affects any right, obligation, immunity or indemnity in favor
of the Managing Trustee under this Agreement, the Managing Trustee may in its discretion decline to execute such document.

 

Article
XII

MISCELLANEOUS
PROVISIONS

 

12.1        Filing
Documents. This Agreement shall be filed or recorded in such office or offices as the Managing Trustee may determine to be
necessary or desirable. A copy of this Agreement and all amendments thereof shall be maintained in the office of the Managing Trustee.
The Managing Trustee shall file or record any amendment of this Agreement and any instrument which relates to any change in the
office of the Managing Trustee.

 

    	20

    	 

    

 

12.2        Beneficiaries
Have No Rights or Privileges as Holders of Fund Units. Except as expressly provided in this Agreement or under applicable law,
the Beneficiaries shall have no rights or privileges attributable to their former status as holders of Fund Units.

 

12.3        Laws
as to Construction. The Trustees, and the Beneficiaries (by their acceptance of any distributions made to them pursuant to
this Agreement), consent and agree that this Agreement shall be governed by, and construed in accordance with, the internal laws
of the State of California, without reference to the choice of law principles thereof.

 

12.4        Severability.
In the event any provision of this Agreement or the application thereof to any Person or circumstances shall be finally determined
by a court of proper jurisdiction to be invalid or unenforceable to any extent, the remainder of this Agreement, or the application
of such provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected
thereby, and each provision of this Agreement shall be valid and enforced to the fullest extent permitted by law.

 

12.5        Notices.
Any notice or other communication shall be in writing and shall be deemed to have been sufficiently given, for all purposes, when
delivered personally or sent by fax or 48 hours after being sent by a nationally-recognized courier or deposited in the U.S. mail,
as certified or registered mail, with postage prepaid.

 

If to the
Managing Trustee:

 

Cornerstone Industrial Properties, LLC

1920 Main Street., Suite
400

 

Irvine, California 92614

 

If to a Beneficiary:

 

The address of such Beneficiary as
shown in the records of the Trust.

 

12.6       Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be an original, but such counterparts shall together
constitute but one and the same instrument.

 

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

 

    	21

    	 

    

 

IN WITNESS WHEREOF, the
Managing Member of the Grantor have caused this Agreement to be executed by an authorized officer, and the Trustees hereunder have
executed this Agreement, as Trustees and not as individuals, as of the date first set forth herein.

 

	GRANTOR:	 
	 	 	 	 	 	 
	Cornerstone Realty Fund, LLC	 
	 	 	 	 	 	 
	 	By:	Cornerstone Industrial Properties, LLC,	 
	 	 	a California limited liability company, its Managing Member	 
	 	 	 	 	 	 
	 	 	By:	Cornerstone Ventures, Inc.,	 
	 	 	 	a California corporation, Its Manager	 
	 	 	 	 	 	 
	 	 	 	By:	/s/ Terry G. Roussel	 
	 	 	 	 	Terry G. Roussel, President	 

 

	MANAGING TRUSTEE:	 
	 	 	 	 
	Cornerstone Industrial Properties, LLC	 
	 	 	 	 
	By:	Cornerstone Ventures, Inc.,	 
	 	a California corporation, Its Manager	 
	 	 	 	 
	 	By:	/s/ Terry G. Roussel	 
	 	 	Terry G. Roussel, President	 

 

    	22

    	 

    

 

EXHIBIT A

 

BILL OF SALE, ASSIGNMENT, ACCEPTANCE

AND ASSUMPTION AGREEMENT

 

    	1AMERICAN EAGLE ENERGY CORPORATION

2012 EQUITY INCENTIVE PLAN

SECTION 1.  Purpose.
The purposes of the American Eagle Energy Corporation 2012 Equity Incentive Plan (the “Plan”) are to motivate
and reward those employees and other individuals, who are expected to contribute significantly to the success of American Eagle
Energy Corporation (the “Company”) and its Affiliates, to perform at the highest level and to further the best
interests of the Company and its stockholders.

SECTION 2.  Definitions.
As used in the Plan, the following terms shall have the meanings set forth below:

(a)“Affiliate”
means (i) any entity that, directly or indirectly, is controlled by the Company and (ii) any entity in which the Company
has a significant equity interest, in each case as determined by the Committee.

(b)“Award”
means any Option, SAR, Restricted Stock, Restricted Stock Unit, Performance Award, or Other Stock-Based Award granted under the
Plan, including a Substitute Award.

(c)“Award
Agreement” means any agreement, contract, or other instrument or document, which may be in electronic format, evidencing
any Award granted under the Plan, which may, but need not, be executed or acknowledged by a Participant. Each Award Agreement shall
be subject to the terms and conditions of the Plan.

(d)“Beneficial
Owner” has the meaning ascribed to such term in Rule 13d-3 under the Exchange Act.

(e)“Beneficiary”
means a person named by a Participant to be entitled to receive payments or other benefits or exercise rights that are available
under the Plan in the event of such Participant’s death. If no such person is named by a Participant, or if no Beneficiary
designated by such Participant is eligible to receive payments or other benefits or exercise rights that are available under the
Plan at such Participant’s death, such Participant’s Beneficiary shall be such Participant’s estate.

(f)“Board”
means the board of directors of the Company.

(g)“Change
of Control” means the occurrence of any one or more of the following events (unless otherwise specified in an Award Agreement
that is subject to Section 409A of the Code):

(i)any
Person (other than the Company, any trustee, or other fiduciary holding securities under any employee benefit plan of the Company
or any entity owned, directly or indirectly, by the stockholders of the Company immediately prior to the occurrence with respect
to which the evaluation is being made in substantially the same proportions as their ownership of the common stock of the Company)
becomes the Beneficial Owner (except that a Person shall be deemed to be the Beneficial Owner of all shares that any such Person
has the right to acquire pursuant to any agreement or arrangement or upon exercise of conversion rights, warrants, or options or
otherwise, without regard to the 60-day period referred to in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities
of the Company, representing 35% or more of the combined voting power of the Company’s then-outstanding securities;

    	1

    	 

    

(ii)during
any twelve-month period, a majority of the members of the Board is replaced by individuals, who were not members of the Board at
the Effective Date and whose election by the Board or nomination for election by the Company’s stockholders was not approved
by a vote of at least a majority of the directors then still in office, who either were directors at the Effective Date or whose
election or nomination for election was previously so approved;

(iii)the
consummation of a merger or consolidation of the Company with any other entity, other than a merger or consolidation that would
result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving or resulting entity) 35% or more of the combined voting
power of the surviving or resulting entity outstanding immediately after such merger or consolidation; or

(iv)the
consummation of a sale or disposition of all or substantially all of the assets of the Company (other than such a sale or disposition
immediately after which such assets will be owned directly or indirectly by the stockholders of the Company in substantially the
same proportions as their ownership of the common stock of the Company immediately prior to such sale or disposition).

(h)“Code”
means the Internal Revenue Code of 1986, as amended from time to time, and the rules, regulations, and guidance thereunder. Any
reference to a provision in the Code shall include any successor provision thereto.

(i)“Consultant”
means any person, including an advisor, who is providing consulting or advisory services to the Company or any Affiliate.

(j)“Continuous
Service Status” means the absence of any interruption or termination of service as an Employee, Director, or Consultant.
Continuous Service Status shall not be considered interrupted in the case of: (i) sick leave; (ii) military leave; (iii) any
other leave of absence approved by the Committee, provided that such leave is for a period of not more than ninety (90) days,
unless reemployment upon the expiration of such leave is guaranteed by contract or statute or unless provided otherwise pursuant
to Company policy adopted from time to time; or (iv) in the case of transfers between locations of the Company or between
the Company, its Affiliates, or their respective successors. A change in status from an Employee to a Consultant (or Director),
from a Consultant to an Employee (or Director) or from Director to a Consultant (or Employee) will not constitute an interruption
of Continuous Service Status.

(k)“Director”
means any member of the Board.

(l)“Disability”
means, with respect to any Participant, “disability” as defined in such Participant’s Employment Agreement, if
any, or if not so defined, except as otherwise provided in such Participant’s Award Agreement, at any time that the Company
or any Affiliate sponsors a long-term disability plan that covers such Participant, “disability” as defined in such
plan for the purpose of determining such Participant’s eligibility for benefits; provided that, if such plan contains
multiple definitions of disability, then “Disability” shall refer to that definition of disability, which, if Participant
qualified for such benefits, would provide coverage for the longest period. The determination of whether Participant has a Disability
shall be made by the person or persons required to make final disability determinations under such plan. At any time that a Participant
is not a party to an Employment Agreement and the Company and its Affiliates do not sponsor a long-term disability plan that covers
such Participant, Disability shall mean Participant’s physical or mental incapacity that renders him or her unable for a
period of 90 consecutive days or an aggregate of 120 days in any consecutive 12-month period to perform his or her duties to the
Company or any Affiliate. With respect to any Incentive Stock Option, “Disability” shall mean “permanent and
total disability” as defined in Section 22(e)(3) of the Code.

    	2

    	 

    

(m)“Effective
Date” means the date as of which this Plan is adopted by the Board.

(n)“Employee”
means any person employed by the Company or any Affiliate, with the status of employment determined based upon such factors as
are deemed appropriate by the Committee in its sole and absolute discretion, subject to any requirements of the Code or applicable
laws.

(o)“Employment
Agreement” means any employment, severance, consulting, or similar agreement between the Company or any of its Affiliates
and a Participant.

(p)“Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to time, and the rules, regulations, and guidance
thereunder. Any reference to a provision in the Exchange Act shall include any successor provision thereto.

(q)“Fair
Market Value” means, with respect to Shares, the closing price of a Share on the date in question (or, if there is no
reported sale on such date, on the last preceding date on which any reported sale occurred) on the principal stock market or exchange
on which the Shares are quoted or traded, or if Shares are not so quoted or traded, fair market value as determined by the Committee,
and, with respect to any property other than Shares, the fair market value of such property determined by such methods or procedures
as shall be established from time to time by the Committee.

(r)“Incentive
Stock Option” means an option representing the right to purchase Shares from the Company, granted pursuant to Section 6,
that meets the requirements of Section 422 of the Code.

(s)“Non-Employee
Director” mans a Director who is a “non-employee director” within the meaning of Rule 16b-3 of the Exchange
Act.

(t)“Nonqualified
Stock Option” means an option representing the right to purchase Shares from the Company, granted pursuant to Section 6,
that is not an Incentive Stock Option. Awards of Options may include the right to receive dividend equivalent payments with respect
to vested Options and payments contingent on vesting with respect to unvested Options.

(u)“Option”
means an Incentive Stock Option or a Nonqualified Stock Option.

    	3

    	 

    

(v)“Other
Stock-Based Award” means an Award granted pursuant to Section 10.

(w)“Outside
Director” means a Director who is an “outside director” within the meaning of Section 162(m) of the Code
of Treasury Regulations Section 1.162-27(e)(3) or any successor to such statute and regulation.

(x)“Participant”
means the recipient of an Award granted under the Plan.

(y)“Performance
Award” means an Award granted pursuant to Section 9.

(z)“Performance
Measure” means one of the following performance measures with respect to the Company: net sales; revenue;
revenue growth or product revenue growth; operating income (before or after taxes); pre- or after-tax income or loss (before or
after allocation of corporate overhead and bonus); net earnings; earnings per share; net income or loss (before or after taxes);
return on equity; total stockholder return; return on assets or net assets; appreciation in and/or maintenance of stock price;
market share; gross profits; earnings or loss (including earnings or loss before taxes, before interest and taxes, or before earnings
before interest, taxes, depreciation, and amortization); economic value-added models or equivalent metrics; comparisons with various
stock market indices; reductions in costs; cash-flow or cash-flow per share (before or after dividends); return on capital (including
return on total capital or return on invested capital); cash-flow return on investment; improvement in or attainment of expense
levels or working capital levels, including cash, inventory, and accounts receivable; operating margin; gross margin; cash margin;
year-end cash; debt reduction; stockholder equity; operating efficiencies; market share; employee satisfaction; exploration, research,
and development achievements; exploration, research and development costs; regulatory achievements (including submitting or filing
applications or other documents with regulatory authorities or receiving approval of any such applications or other documents and
passing pre-approval inspections; financial ratios, including those measuring liquidity, activity, profitability, or leverage;
financing and other capital raising transactions (including sales of the Company’s equity or debt securities; sales or licenses
of the Company’s assets, whether in a particular jurisdiction, territory, or globally or through partnering transactions);
implementation, completion, or attainment of measurable objectives with respect to research, development, drilling, production
volume levels, acquisitions, and divestitures; reserve additions; reserve value or reserve value per share; factoring transactions;
and recruiting and maintaining personnel.

(aa)“Person”
has the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof,
including “group” as defined in Section 13(d) thereof.

(bb)“Restricted
Stock” means any Shares granted pursuant to Section 8.

(cc)“Restricted
Stock Unit” means a contractual right granted pursuant to Section 8 that is denominated in Shares. Each Restricted
Stock Unit represents a right to receive the value of one Share (or a percentage of such value) in cash, Shares, or a combination
thereof. Awards of Restricted Stock Units may include the right to receive dividend equivalents.

    	4

    	 

    

(dd)“SAR”
means any right granted pursuant to Section 7 to receive, upon exercise by a Participant or settlement, in cash, Shares, or
a combination thereof, the excess of (i) the Fair Market Value of one Share on the date of exercise or settlement over (ii) the
exercise or hurdle price of the right on the date of grant, or, if granted in connection with an Option, on the date of grant of
the Option.

(ee)“Section
162(m) Compensation” means “qualified performance-based compensation” under Section 162(m) of the Code.

(ff)“Shares”
means shares of the Company’s common stock, par value $0.001 per share.

(gg)“Substitute
Award” means an Award granted in assumption of, or in substitution for, an outstanding award previously granted by an
entity acquired by the Company or with which the Company combines.

SECTION 3.  Eligibility.

(a)Awards
may be granted to Employees, Consultants, and Directors.

(b)Holders
of equity-based awards granted by an entity acquired by the Company or with which the Company combines are eligible for grants
of Substitute Awards under the Plan to the extent permitted under applicable listing standards of any stock exchange on which the
Company is listed.

SECTION 4.  Administration.

(a)Administration
of the Plan. The Plan shall be administered by the Compensation Committee of the Board (the “Committee”),
or in the Board’s sole discretion, by the Board. All decisions of the Committee shall be final, conclusive, and binding upon
all parties, including the Company, its stockholders, and Participants and any Beneficiaries thereof. The Committee shall issue
rules and regulations for administration of the Plan.

(b)Delegation.
The Committee, or if Board has not established the Committee, the Board, may delegate administration of the Plan to a committee
or committees of one or more members of the Committee or the Board, as applicable, and the term “Committee” shall apply
to any person or persons whom such authority has been delegated. The Committee shall have the authority to delegate to a subcommittee
any of the administrative powers the Committee is authorized to exercise (and references in this Plan to the Board or the Committee
shall thereafter be to the committee or subcommittee), subject, however, to such resolutions, not inconsistent with the provisions
of the Plan as may be adopted from time to time by the Board. The members of the Committee shall be appointed by and serve at the
pleasure of the Board. From time to time, the Board may increase or decrease the size of the Committee, add additional members
to, remove members (with or without cause) from, appoint new members in substitution therefor, and fill vacancies, however caused,
in the Committee. The Committee shall act by the unanimous vote or by unanimous written consent of its members, and minutes shall
be kept of all of its meetings and copies thereof shall be provided to the Board.

(c)Composition
of Committee. To the extent necessary or desirable to comply with applicable regulatory regimes, including, without limitation,
Section 162(m) of the Code, any action by the Board or the Committee, as applicable, shall require the approval of the Directors
or Committee members, as applicable, who are (i) independent, within the meaning of and to the extent required by applicable
rulings and interpretations of the applicable stock market or exchange on which the Shares are quoted or traded; (ii) Non-Employee
Directors; and (iii) Outside Directors. The Board may designate one or more directors as alternate members of the Committee
who may replace any absent or disqualified member at any meeting of the Committee. To the extent permitted by applicable law, the
Committee may delegate to one or more officers of the Company the authority to grant Options and SARs, except that such delegation
shall not be applicable to any Award for a person then covered by Section 16 of the Exchange Act.

    	5

    	 

    

(d)Authority
of the Committee. Subject to the terms of the Plan and applicable law, the Committee (or its delegate) shall have full power
and authority to: (i) designate Participants; (ii) determine the type or types of Awards to be granted to each Participant
under the Plan; (iii) determine the number of Shares to be covered by (or with respect to which payments, rights, or other
matters are to be calculated in connection with) Awards; (iv) determine the terms and conditions of any Award; (v) determine
whether, to what extent, and under what circumstances Awards may be settled or exercised in cash, Shares, other Awards, other property,
net settlement, or any combination thereof, or canceled, forfeited, or suspended, and the method or methods by which Awards may
be settled, exercised, canceled, forfeited, or suspended; (vi) determine whether, to what extent, and under what circumstances
a tax withholding obligation may be satisfied in cash, Shares, other Awards, or other property; (vii) determine whether, to what
extent and under what circumstances cash, Shares, other Awards, other property, and other amounts payable with respect to an Award
under the Plan shall be deferred either automatically or at the election of the holder thereof or of the Committee; (viii) interpret
and administer the Plan and any instrument or agreement relating to, or Award made under, the Plan; (ix) establish, amend,
suspend, or waive such rules, and regulations and appoint such agents as it shall deem appropriate for the proper administration
of the Plan; and (x) make any other determination and take any other action that the Committee deems necessary or desirable
for the administration of the Plan.

(e)Dodd-Frank
Clawback. The Committee shall full authority to implement any policies and procedures necessary to comply with Section 10D
of the Exchange Act and any rules promulgated thereunder. Without limiting the foregoing, the Committee may provide in Award Agreements
that, in the event of a financial restatement that reduces the amount of previously awarded incentive compensation that would not
have been earned had results been properly reported, outstanding Awards will be cancelled and the Company may clawback (i.e.,
recapture) realized Option/SAR gains and realized value for vested Restricted Stock or Restricted Stock Units or earned Performance
Awards.

(f)Restrictive
Covenants. The Committee may impose restrictions on any Award with respect to non-competition, confidentiality, and other restrictive
covenants as it deems necessary or appropriate in its sole discretion.

SECTION 5.  Shares
Available for Awards.

(a)Subject
to adjustment as provided in Section 5(d) and except for Substitute Awards, the maximum number of Shares available for issuance
under the Plan shall not exceed in the aggregate 3,121,456 shares of Common Stock.

    	6

    	 

    

(b)Any
Shares subject to an Award (other than a Substitute Award), that expires, is canceled, forfeited, or otherwise terminates without
the delivery of such Shares, including (i) the number of Shares surrendered or withheld in payment of any grant, purchase,
exercise, or hurdle price of an Award or taxes related to an Award (other than Shares already issued and surrendered for payment
of taxes) and (ii) any Shares subject to an Award to the extent that Award is settled without the issuance of Shares, shall
again be, or shall become, available for issuance under the Plan.

(c)In
the event that, as a result of any dividend or other distribution (whether in the form of cash, Shares, or other securities), recapitalization,
stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange
of Shares or other securities of the Company, issuance of warrants or other rights to purchase Shares or other securities of the
Company, issuance of Shares pursuant to the anti-dilution provisions of securities of the Company, or other similar corporate transaction
or event affecting the Shares, an adjustment is appropriate in order to prevent dilution or enlargement of the benefits or potential
benefits intended to be made available under the Plan, then the Committee shall adjust equitably any or all of:

(i)the
number and type of Shares (or other securities) that thereafter may be made the subject of Awards, including the aggregate limits
specified in Section 5(a) and the individual limits specified in Section 5(f);

(ii)the
number and type of Shares (or other securities) subject to outstanding Awards;

(iii)the
grant, purchase, exercise, or hurdle price with respect to any Award or, if deemed appropriate, make provision for a cash payment
to the holder of an outstanding Award; and

(iv)Performance
Measures set forth in any Performance Awards that are based on, derived from, or related to Share value;

provided, however,
that the number of Shares subject to any Award denominated in Shares shall always be a whole number.

(d)With
respect to any Award intended to be Section 162(m) Compensation, the following limits shall apply to the amount that may be
awarded to any Participant during any calendar year, subject to adjustment as provided in Section 5(c): (A) Options and
SARs that relate to no more than 250,000 Shares; (B) Performance Awards that relate to no more than 250,000 Shares; and (C) cash-based
Awards that relate to no more than $500,000.

SECTION 6.  Options.
The Committee may grant Options to Participants with the following terms and conditions and with such additional terms and
conditions, in either case not inconsistent with the provisions of the Plan, as the Committee shall determine:

(a)The
exercise price per Share under an Option shall be determined by the Committee; provided, however, that, except in
the case of Substitute Awards, such exercise price shall not be less than the Fair Market Value of a Share on the date of grant
of such Option.

(b)The
term of each Option shall be fixed by the Committee but shall not exceed 10 years from the date of grant of such Option; provided
that the Committee may (but shall not be required to) provide in an Award Agreement for an extension of such 10-year term in the
event the exercise of the Option would be prohibited by law on the expiration date.

    	7

    	 

    

(c)The
Committee shall determine the time or times at which an Option become vested and exercisable in whole or in part. The Committee
may specify in an Award Agreement that an “in-the-money” Option shall be automatically exercised on its expiration
date.

(d)The
consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined
by the Committee. Such consideration, to the extent permitted by applicable laws, may consist of one or a combination of: (i) cash
or check or combination thereof or broker-assisted cashless exercise or (ii) to the extent expressly permitted by the Committee,
(A) other Shares that have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares
as to which said Option shall be exercised or (B) such other consideration and method of payment for the issuance of Shares
to the extent permitted by applicable laws.

(e)The
terms of any Incentive Stock Option granted under the Plan shall comply in all respects with the provisions of Section 422
of the Code. Incentive Stock Options may be granted only to employees of the Company or of a parent or subsidiary corporation (as
defined in Section 424(a) of the Code). Notwithstanding any designation as an Incentive Stock Option, to the extent that the
aggregate Fair Market Value of Shares subject to a Participant’s incentive stock options that become exercisable for the
first time during any calendar year exceeds $100,000, such excess Options shall be treated as Nonqualified Stock Options. For purposes
of the foregoing, Incentive Stock Options shall be taken into account in the order in which they were granted, and the Fair Market
Value of the Shares shall be determined as of the time of grant. No Incentive Stock Options may be issued more than ten years following
the earlier of (i) the date of adoption or (ii) the most recent date of approval of this Plan by the Company’s
stockholders.

(f)Unless
otherwise determined by the Committee or unless otherwise set forth in an Award Agreement, the following provisions shall be applicable
upon termination of a Participant’s Continuous Service Status:

(i)If
termination of the Participant’s Continuous Service Status is as a result of the Participant’s Disability, the Participant
may exercise the Option at any time within twelve months following the date of termination (but in no event later than the expiration
of the term of such Option as set forth in the Award Agreement), but only to the extent the Option was vested and exercisable as
of the date of termination of Continuous Service Status, after which time the Option shall terminate.

(ii)If
a Participant dies (a) during the term of the Option and while in Continuous Service Status or (b) within twelve months
after termination of Continuous Service Status, the Option may be exercised at any time within six months following the date of
death (but in no event later than the expiration of the term of such Option as set forth in the Award Agreement) by the Participant’s
estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent the Option
was vested and exercisable as of the termination of Continuous Service Status, after which time the Option shall terminate.

    	8

    	 

    

(iii)If
a Participant’s Continuous Service Status terminates for any other reason, the Participant may exercise his or her Option
at any time within three months after such termination (but in no event later than the expiration of the term of such Option as
set forth in the Award Agreement), but only to the extent that the Option was vested and exercisable at the date of such termination.

(iv)To
the extent that a Participant’s Option was not vested and exercisable at the date of termination of the Participant’s
Continuous Service Status, the Option shall terminate immediately upon such termination of Continuous Service Status.

SECTION 7.  Stock
Appreciation Rights. The Committee may grant SARs to Participants with the following terms and conditions and with
such additional terms and conditions, in either case not inconsistent with the provisions of the Plan, as the Committee shall determine:

(a)The
exercise or hurdle price per Share under a SAR shall be determined by the Committee; provided, however, that, except
in the case of Substitute Awards, such exercise or hurdle price shall not be less than the Fair Market Value of a Share on the
date of grant of such SAR.

(b)The
term of each SAR shall be fixed by the Committee but shall not exceed 10 years from the date of grant of such SAR.

(c)The
Committee shall determine the time or times at which a SAR may be exercised or settled in whole or in part. Unless otherwise determined
by the Committee or unless otherwise set forth in an Award Agreement, the provisions set forth in Section 6(f) above with
respect to exercise of an Award following termination of Continuous Service Status shall apply to any SAR. The Committee may specify
in an Award Agreement that an “in-the-money” SAR shall be automatically exercised on its expiration date.

SECTION 8.  Restricted
Stock and Restricted Stock Units. The Committee may grant Awards of Restricted Stock and Restricted Stock Units
to Participants with the following terms and conditions and with such additional terms and conditions, in either case not inconsistent
with the provisions of the Plan, as the Committee shall determine:

(a)The
Award Agreement shall specify the vesting schedule and, with respect to Restricted Stock Units, the delivery schedule (which may
include deferred delivery later than the vesting date).

(b)Shares
of Restricted Stock and Restricted Stock Units shall be subject to such restrictions as the Committee may impose (including any
limitation on the right to vote a Share of Restricted Stock or the right to receive any dividend, dividend equivalent, or other
right), which restrictions may lapse separately or in combination at such time or times, in such installments or otherwise, as
the Committee may deem appropriate.

(c)Any
share of Restricted Stock granted under the Plan may be evidenced in such manner as the Committee may deem appropriate, including
book-entry registration or issuance of a stock certificate or certificates. In the event any stock certificate is issued in respect
of shares of Restricted Stock granted under the Plan, such certificate shall be registered in the name of such Participant and
shall bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Restricted Stock.

    	9

    	 

    

SECTION 9.  Performance
Awards. The Committee may grant Performance Awards to Participants with the following terms and conditions and with such
additional terms and conditions, in either case not inconsistent with the provisions of the Plan, as the Committee shall determine:

(a)Performance
Awards may be denominated as a cash amount, number of Shares, or a combination thereof and are Awards which may be earned upon
achievement or satisfaction of performance conditions specified by the Committee. In addition, the Committee may specify that any
other Award shall constitute a Performance Award by conditioning the right of a Participant to exercise the Award or have it settled,
and the timing thereof, upon achievement or satisfaction of such performance conditions as may be specified by the Committee. The
Committee may use such business criteria and other measures of performance as it may deem appropriate in establishing any performance
conditions. Subject to the terms of the Plan, the performance goals to be achieved during any performance period, the length of
any performance period, the amount of any Performance Award granted and the amount of any payment or transfer to be made pursuant
to any Performance Award shall be determined by the Committee.

(b)If
the Committee intends that a Performance Award should constitute Section 162(m) Compensation, such Performance Award shall
include a pre-established formula, such that payment, retention, or vesting of the Award is subject to the achievement during a
Performance Period or Performance Periods, as determined by the Committee, of a level or levels of, or increases in, in each case
as determined by the Committee, one or more Performance Measures. Performance Measures may be established on an absolute (e.g.,
plan or budget) or relative basis, and may be established on a corporate-wide basis or with respect to one or more business units,
divisions, subsidiaries, or business segments. Relative performance may be measured against a group of peer companies, a financial
market index, or other acceptable objective and quantifiable indices. The Award Agreement may provide that if the Committee determines
that a change in the business, operations, corporate structure, or capital structure of the Company, or the manner in which the
Company conducts its business, or other events or circumstances render the performance objectives unsuitable, the Committee may
modify the performance objectives, or the related minimum acceptable level of achievement, in whole or in part, as the Committee
deems appropriate and equitable. Performance Measures may vary from Performance Award to Performance Award, respectively, and from
Participant to Participant, and may be established on a stand-alone basis, in tandem or in the alternative. The Committee shall
have the power to impose such other restrictions on Awards subject to this Section 9(b) as it may deem necessary or appropriate
to ensure that such Awards satisfy all requirements for Section 162(m) Compensation. Notwithstanding any provision of the
Plan to the contrary, with respect to any Award intended to be Section 162(m) Compensation, the Committee shall not be authorized
to increase the amount payable under any Award to which this Section 9(b) applies upon attainment of such pre-established
formula, except as provided in Section 5(c)(iv).

(c)Settlement
of Performance Awards shall be in cash, Shares, other Awards, other property, net settlement, or any combination thereof, in the
discretion of the Committee. The Committee shall specify the circumstances in which, and the extent to which, Performance Awards
shall be paid or forfeited in the event of termination of a Continuous Service Status.

    	10

    	 

    

(d)Performance
Awards will be settled only after the end of the relevant Performance Period. Any settlement that changes the form of payment from
that originally specified shall be implemented in a manner such that the Performance Award and other related Awards do not, solely
for that reason, fail to qualify as Section 162(m) Compensation.

SECTION 10.  Other
Stock-Based Awards. The Committee may, subject to limitations under applicable law, grant to Participants such other Awards
that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Shares
or factors that may influence the value of Shares, including convertible or exchangeable debt securities, other rights convertible
or exchangeable into Shares, purchase rights for Shares, Awards with value and payment contingent upon performance of the Company
or business units thereof or any other factors designated by the Committee. The Committee shall determine the terms and conditions
of such Awards. Shares delivered pursuant to an Award in the nature of a purchase right granted under this Section 10 shall
be purchased for such consideration, paid for at such times, by such methods and in such forms, including cash, Shares, other Awards,
other property, or any combination thereof, as the Committee shall determine. Cash awards, as an element of or supplement to any
other Award under the Plan, may also be granted pursuant to this Section 10.

SECTION 11.  Automatic
Grants to Outside Directors. The Board or a committee thereof may institute, by resolution, automatic Award grants to new
and to continuing members of the Board, with the number and type of such Awards, with such terms and conditions, and based upon
such criteria, if any, as is determined by the Board or its committee, in their sole discretion.

SECTION 12.  Effect
of a Change of Control on Awards.

(a)The
Committee may (but shall not be required to) provide for accelerated vesting of an Award upon, or as a result of specified events
following, a Change of Control, either in an Award Agreement or in connection with the Change of Control.

(b)In
the event of a Change of Control, the Committee may cause any Award:

(i)to
be canceled in consideration of a payment in cash or other consideration to such Participant who holds such Award in an amount
per share equal to the excess, if any, of the price or implied price per Share in a Change in Control over the per Share exercise
or purchase price of such Award, which may be paid immediately or over the vesting schedule of the Award; or

(ii)to
be assumed or a substantially equivalent Award shall be substituted by the successor corporation or a parent or subsidiary of such
successor corporation (the “Successor Corporation”), unless the Successor Corporation does not agree to assume
the award or to substitute an equivalent option or right (or agree to cashout the Award as provided in clause (i)), in which case
such Award shall become fully vested immediately prior to the Change of Control and shall thereafter terminate. An Award shall
be considered assumed, without limitation, if, at the time of issuance of the stock or other consideration upon a Change of Control,
as the case may be, each holder of an Award would be entitled to receive upon exercise of the award the same number and kind of
shares of stock or the same amount of property, cash, or securities as such holder would have been entitled to receive upon the
occurrence of the transaction if the holder had been, immediately prior to such transaction, the holder of the number of Shares
covered by the award at such time; provided that, if such consideration received in the transaction is not solely common
stock of the Successor Corporation, the Committee may, with the consent of the Successor Corporation, provide for the consideration
to be received upon exercise of the assumed award to be solely common stock of the Successor Corporation.

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SECTION 13.  General
Provisions Applicable to Awards.

(a)Awards
shall be granted for such cash or other consideration, if any, as the Committee determines; provided that, in no event,
shall Awards be issued for less than such minimal consideration as may be required by applicable law.

(b)Awards
may, in the discretion of the Committee, be granted either alone or in addition to or in tandem with any other Award or any award
granted under any other plan of the Company. Awards granted in addition to or in tandem with other Awards, or in addition to or
in tandem with awards granted under any other plan of the Company, may be granted either at the same time as or at a different
time from the grant of such other Awards or awards.

(c)Subject
to the terms of the Plan, payments or transfers to be made by the Company upon the grant, exercise, or settlement of an Award may
be made in the form of cash, Shares, other Awards, other property, net settlement, or any combination thereof, as determined by
the Committee in its discretion, whether at the time of grant, at the time of exercise or settlement or otherwise, and may be made
in a single payment or transfer, in installments or on a deferred basis, in each case in accordance with rules and procedures established
by the Committee. Such rules and procedures may include provisions for the payment or crediting of reasonable interest on installment
or deferred payments or the grant or crediting of dividend equivalents in respect of installment or deferred payments.

(d)Except
as may be permitted by the Committee (except with respect to Incentive Stock Options) or as specifically provided in an Award Agreement,
(i) no Award and no right under any Award shall be assignable, alienable, saleable, or transferable by a Participant otherwise
than by will or pursuant to Section 13(e) and (ii) during a Participant’s lifetime, each Award, and each right
under any Award, shall be exercisable only by such Participant or, if permissible under applicable law, by such Participant’s
guardian or legal representative. The provisions of this Section 13(d) shall not preclude forfeiture of an Award in accordance
with the terms thereof.

(e)A
Participant may designate a Beneficiary or change a previous Beneficiary designation at such times prescribed by the Committee
by using forms and following procedures approved or accepted by the Committee for that purpose.

(f)All
certificates for Shares and/or other securities delivered under the Plan pursuant to any Award or the exercise thereof shall be
subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations,
and other requirements of the Securities and Exchange Commission, any stock market or exchange upon which such Shares or other
securities are then quoted, traded, or listed, and any applicable securities laws, and the Committee may cause a legend or legends
to be put on any such certificates to make appropriate reference to such restrictions.

    	12

    	 

    

SECTION 14.  Amendments
and Termination.

(a)Amendment
of Plan. Except to the extent prohibited by applicable law and unless otherwise expressly provided in an Award Agreement or
in the Plan, the Board may amend, alter, suspend, discontinue, or terminate the Plan or any portion thereof at any time; provided,
however, that no such amendment, alteration, suspension, discontinuation, or termination shall be made without (i) stockholder
approval if such approval is required by applicable law or the rules of the stock market or exchange, if any, on which the Shares
are principally quoted or traded or (ii) the consent of the affected Participant, if such action would materially adversely
affect the rights of such Participant under any outstanding Award, except (x) to the extent any such amendment, alteration,
suspension, discontinuance, or termination is made to cause the Plan to comply with applicable law, stock market, or exchange rules
and regulations or accounting or tax rules and regulations or (y) to impose any “clawback” or recoupment provisions
on any Awards in accordance with Section 4(d) of the Plan. Notwithstanding anything to the contrary in the Plan, the Committee
may amend the Plan, or create sub-plans, in such manner as may be necessary for the purpose of qualifying for preferred tax treatment
under non-U.S. tax laws or complying with local rules and regulations. The Committee may correct any defect, supply any omission,
or reconcile any inconsistency in the Plan or any Award in the manner and to the extent it shall deem desirable to carry the Plan
into effect.

(b)Dissolution
or Liquidation. In the event of the dissolution or liquidation of the Company, each Award will terminate immediately prior
to the consummation of such action, unless otherwise determined by the Committee.

(c)Terms
of Awards. The Committee may waive any conditions or rights under, amend any terms of, or amend, alter, suspend, discontinue,
or terminate any Award theretofore granted, prospectively or retroactively, without the consent of any relevant Participant or
holder or Beneficiary of an Award; provided, however, that no such action shall materially adversely affect the rights of
any affected Participant or holder or Beneficiary under any Award theretofore granted under the Plan, except (x) to the extent
any such action is made to cause the Plan to comply with applicable law, stock market or exchange rules and regulations, or accounting
or tax rules and regulations or (y) to impose any “clawback” or recoupment provisions on any Awards in accordance
with Section 4(d) of the Plan.

(d)No
Repricing. Notwithstanding the foregoing, except as provided in Section 5(d), no amendment to the terms of outstanding
Options or SARs that reduces the exercise or hurdle price of such Options or SARs and no cancellation of any outstanding options
or SARs in exchange for Options or SARs with an exercise price that is less than the exercise price of the original Options or
SARs shall be made without approval of the Company’s stockholders.

SECTION 15.  Miscellaneous.

(a)No
employee, Participant or other person shall have any claim to be granted any Award under the Plan, and there is no obligation for
uniformity of treatment of employees, Participants, or holders or Beneficiaries of Awards under the Plan. The terms and conditions
of Awards need not be the same with respect to each recipient. Any Award granted under the Plan shall be a one-time Award that
does not constitute a promise of future grants. The Company, in its sole discretion, maintains the right to make available future
grants under the Plan.

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(b)The
grant of an Award shall not be construed as giving a Participant the right to be retained in the employ of, or to continue to provide
services to, the Company or any Affiliate. Further, the Company or the applicable Affiliate may at any time dismiss a Participant,
free from any liability, or any claim under the Plan, unless otherwise expressly provided in the Plan or in any Award Agreement
or in any other agreement binding the parties. The receipt of any Award under the Plan is not intended to confer any rights on
the receiving Participant except as set forth in the applicable Award Agreement.

(c)Nothing
contained in the Plan shall prevent the Company from adopting or continuing in effect other or additional compensation arrangements,
and such arrangements may be either generally applicable or applicable only in specific cases.

(d)The
Company shall be authorized to withhold from any Award granted or any payment due or transfer made under any Award or under the
Plan or from any compensation or other amount owing to a Participant the amount (in cash, Shares, other Awards, other property,
net settlement, or any combination thereof) of applicable withholding taxes due in respect of an Award, its exercise or settlement
or any payment or transfer under such Award or under the Plan and to take such other action (including providing for elective payment
of such amounts in cash or Shares by such Participant) as may be necessary in the opinion of the Company to satisfy all obligations
for the payment of such taxes; provided that, if the Committee allows the withholding or surrender of Shares to satisfy
a Participant’s tax withholding obligations, the Company shall not allow Shares to be withheld in an amount that exceeds
the minimum statutory withholding rates for federal and state tax purposes, including payroll taxes.

(e)If
any provision of the Plan or any Award Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction,
or as to any person or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such
provision shall be construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended
without, in the determination of the Committee, materially altering the intent of the Plan or the Award Agreement, such provision
shall be stricken as to such jurisdiction, person, or Award and the remainder of the Plan and any such Award Agreement shall remain
in full force and effect.

(f)Neither
the Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship
between the Company and a Participant or any other person. To the extent that any person acquires a right to receive payments from
the Company pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Company.

(g)No
fractional Shares shall be issued or delivered pursuant to the Plan or any Award and the Committee shall determine whether cash
or other securities shall be paid or transferred in lieu of any fractional Shares, or whether such fractional Shares or any rights
thereto shall be canceled, terminated, or otherwise eliminated.

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(h)Non-Transferability
of Awards. No Award shall be transferable by any Participant other than by will or by the laws of descent and distribution
or pursuant to a qualified domestic relations order (as defined in the Code or the Employment Retirement Income Security Act of
1974, as amended) except that, if so provided in the Award Agreement, the Participant may transfer the Award, other than an Incentive
Stock Option, during the Participant’s lifetime to one or more members of the Participant’s family, to one or more
trusts for the benefit of one or more of the Participant’s family, to a partnership or partnerships of members of the Participant’s
family, or to a charitable organization as defined in Section 501(c)(3) of the Code, but only if the transfer would not result
in the loss of any exemption under Rule 16b-3 of the Exchange Act with respect to any Award. The transferee of an Award will be
subject to all restrictions, terms, and conditions applicable to the Award prior to its transfer, except that the Award will not
be further transferable by the transferee other than by will or by the laws of descent and distribution.

SECTION 16.  Effective
Date of the Plan. The Plan shall be effective as of the Effective Date.

SECTION 17.  Term
of the Plan. No Award shall be granted under the Plan after the earliest to occur of (i) the tenth year anniversary
of the Effective Date; provided that, to the extent permitted by the listing rules of any stock exchange on which a class
or series of equity or debt of the Company is listed, such ten-year term may be extended indefinitely so long as the maximum number
of Shares available for issuance under the Plan have not been issued; (ii) the maximum number of Shares available for issuance
under the Plan have been issued; or (iii) the Board terminates the Plan in accordance with Section 14(a). However, unless
otherwise expressly provided in the Plan or in an applicable Award Agreement, any Award theretofore granted may extend beyond such
date and the authority of the Committee to amend, alter, adjust, suspend, discontinue, or terminate any such Award, or to waive
any conditions or rights under any such Award, and the authority of the Board to amend the Plan, shall extend beyond such date.

SECTION 18.  Section 409A
of the Code. With respect to Awards subject to Section 409A of the Code, the Plan is intended to comply with
the requirements of Section 409A of the Code and the regulations thereunder (“Section 409A”); the provisions
of the Plan and any Award Agreement shall be interpreted in a manner that satisfies the requirements of Section 409A; and
the Plan shall be operated accordingly. If any provision of the Plan or any term or condition of any Award would otherwise frustrate
or conflict with this intent, the provision, term, or condition will be interpreted and deemed amended so as to avoid this conflict.
Notwithstanding anything else in the Plan, if the Board determines a Participant to be one of the Company’s “specified
employees” under Section 409A(2)(B)(i) of the Code at the time of such Participant’s separation from service (as
defined in Section 409A(2)(A)(i)) in accordance with the identification date specified in Section 1.409A-1(d)(i)(4) of the
Treasury Regulations and the amount hereunder is “deferred compensation” subject to Section 409A, then any distribution
that otherwise would be made to such Participant with respect to this Award as a result of such termination shall not be made until
the date that is six months after such separation from service or , if earlier, the date of the death of the Participant.

SECTION
19.  Governing Law. The Plan and each Award Agreement shall be governed by the laws of the State of
Nevada, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of
this Plan to the substantive law of another jurisdiction.

    	15

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