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                                                                    EXHIBIT 10.5

                     AMENDED AND RESTATED ADVISORY AGREEMENT

      THIS AMENDED AND RESTATED ADVISORY AGREEMENT, dated as of February 17,
2005, is between CORPORATE PROPERTY ASSOCIATES 15 INCORPORATED, a Maryland
corporation (the "Company"), and CAREY ASSET MANAGEMENT CORP., a Delaware
corporation and wholly-owned subsidiary of W. P. Carey & Co. LLC (the "Advisor")
and amends the Advisory Agreement dated December 9, 2002 between the Company and
the Advisor.

                              W I T N E S S E T H:

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

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

      NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows:

      1. DEFINITIONS. As used in this Agreement, the following terms have the
definitions hereinafter indicated:

            Acquisition Expenses. Those expenses, including but not limited to
      legal fees and expenses, travel and communications expenses, costs of
      appraisals, nonrefundable option payments on Property not acquired,
      accounting fees and expenses, title insurance and miscellaneous expenses,
      related to selection and acquisition of Properties, whether or not
      acquired. Acquisition Expenses shall not include Acquisition Fees.

            Acquisition Fees. The total of all fees and commissions (including
      any interest thereon) paid by any party to any party in connection with
      the making or investing in mortgage loans or the purchase, development or
      construction of Properties by the Company. A Development Fee or a
      Construction Fee paid to a Person not affiliated with the Sponsor in
      connection with the actual development or construction of a project after
      acquisition of the Property by the Company shall not be deemed an
      Acquisition Fee. Included in the computation of such fees or commissions
      shall be any real estate commission, selection fee, development fee (other
      than as described above) or any fee of a similar nature, however
      designated. Acquisition Fees include Subordinated Acquisition Fees unless
      the context otherwise requires. Acquisition Fees shall not include
      Acquisition Expenses.

            Adjusted Investor Capital. As of any date, the Initial Investor
      Capital for such date reduced by any distributions on or prior to such
      date deemed by the Board to be from Cash from Sales and Financings, but
      only to the extent such distributions exceed the amount

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      necessary to satisfy any accrued but unpaid portion of the Preferred
      Return not satisfied by distributions of cash generated through operations
      through the date Cash from Sales or Financings are distributed by the
      Company.

            Advisor. Carey Asset Management Corp, a corporation organized under
      the laws of the State of Delaware and wholly-owned by W. P. Carey & Co.
      LLC.

            Affiliate. An Affiliate of another Person shall include any of the
      following: (i) any Person directly or indirectly owning, controlling, or
      holding, with power to vote ten percent or more of the outstanding voting
      securities of such other Person; (ii) any Person ten percent or more of
      whose outstanding voting securities are directly or indirectly owned,
      controlled, or held, with power to vote, by such other Person; (iii) any
      Person directly or indirectly controlling, controlled by, or under common
      control with such other Person; (iv) any executive officer, director,
      trustee or general partner of such other Person; or (iv) any legal entity
      for which such Person acts as an executive officer, director, trustee or
      general partner.

            Agreement. This Advisory Agreement.

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

            Articles of Incorporation. Articles of Incorporation of the Company
      under the General Corporation Law of Maryland, as amended from time to
      time, pursuant to which the Company is organized.

            Asset Management Fee. The Asset Management Fee as defined in Section
      9(a) hereof.

            Average Invested Assets. The average of the aggregate book value of
      the assets of the Company invested, directly or indirectly, in Properties
      and in Loans secured by real estate, before reserves for depreciation or
      bad debts or other similar non-cash reserves, computed by taking the
      average of such values at the end of each month during such period.

            Board or Board of Directors. The Board of Directors of the Company.

            Bylaws. The bylaws of the Company.

            Cash from Financings. Net cash proceeds realized by the Company from
      the financing of Properties or the refinancing of any Company
      indebtedness.

            Cash from Sales. Net cash proceeds realized by the Company from the
      sale, exchange or other disposition of any of its assets after deduction
      of all expenses incurred in connection therewith. Cash from Sales shall
      not include Cash from Financings.

            Cash from Sales and Financings. The total sum of Cash from Sales and
      Cash from Financings.

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            Cause. With respect to the termination of this Agreement, fraud,
      criminal conduct, willful misconduct or willful or negligent breach of
      fiduciary duty by the Advisor or a breach of this Agreement by the
      Advisor.

            Change of Control. A change of control of the Company of a nature
      that would be required to be reported in response to the disclosure
      requirements of Schedule 14A of Regulation 14A promulgated under the
      Securities Exchange Act of 1934, as amended (the "Exchange Act"), as
      enacted and in force on the date hereof, whether or not the Company is
      then subject to such reporting requirements; provided, however, that,
      without limitation, a Change of Control shall be deemed to have occurred
      if: (i) any "person" (within the meaning of Section 13(d) of the Exchange
      Act, as enacted and in force on the date hereof) is or becomes the
      "beneficial owner" (as that term is defined in Rule 13d-3, as enacted and
      in force on the date hereof, under the Exchange Act) of securities of the
      Company representing 8.5% or more of the combined voting power of the
      Company's securities then outstanding; (ii) there occurs a merger,
      consolidation or other reorganization of the Company which is not approved
      by the Board of Directors; (iii) there occurs a sale, exchange, transfer
      or other disposition of substantially all of the assets of the Company to
      another entity, which disposition is not approved by the Board of
      Directors; or (iv) there occurs a contested proxy solicitation of the
      Shareholders of the Company that results in the contesting party electing
      candidates to a majority of the Board of Directors' positions next up for
      election.

            Code. Internal Revenue Code of 1986, as amended.

            Company. Corporate Property Associates 15 Incorporated, a
      corporation organized under the laws of the State of Maryland.

            Competitive Real Estate Commission. The real estate or brokerage
      commission paid for the purchase or sale of a property that is reasonable,
      customary and competitive in light of the size, type and location of the
      property.

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

            Contract Purchase Price. The amount actually paid for or allocated
      (as of the date of purchase) to the purchase, development, construction or
      improvement of a Property, exclusive of Acquisition Fees and Acquisition
      Expenses.

            Contract Sales Price. The total consideration received by the
      Company for the sale of a Property.

            Cumulative Return. For the period for which the calculation is being
      made, the percentage resulting from dividing (A) the total Dividends paid
      on each Dividend payment date during such period (not including Dividends
      paid out of Cash from Sales and Financings), by (B) the product of (i) the
      average Adjusted Investor Capital for such period (calculated on a daily
      basis), and (ii) the number of years (including fractions thereof) elapsed
      during such period.

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            Development Fee. A fee for the packaging of a Property including
      negotiating and approving plans, and undertaking to assist in obtaining
      zoning and necessary variances and necessary financing for the specific
      Property, either initially or at a later date.

            Directors. The persons holding such office, as of any particular
      time, under the Articles of Incorporation, whether they be the directors
      named therein or additional or successor directors.

            Dividends. Dividends declared by the Board.

            Equity Interest. The stock of or other interests in, or warrants or
      other rights to purchase the stock of or other interests in, any entity
      that has borrowed money from the Company or that is a tenant of the
      Company or that is a parent or controlling Person of any such borrower or
      tenant.

            Final Closing Date. The last date on which purchasers of Shares
      offered pursuant to the Prospectus were issued such Shares.

            Good Reason. With respect to the termination of this Agreement, (i)
      any failure to obtain a satisfactory agreement from any successor to the
      Company to assume and agree to perform the Company's obligations under
      this Agreement; or (ii) any material breach of this Agreement of any
      nature whatsoever by the Company.

            Gross Offering Proceeds. The aggregate purchase price of Shares sold
      pursuant to the Offering.

            Independent Appraiser. A qualified appraiser of real estate as
      determined by the Board, who is not affiliated, directly or indirectly,
      with the Company, the Advisor or their respective Affiliates. Membership
      in a nationally recognized appraisal society such as the American
      Institute of Real Estate Appraisers or the Society of Real Estate
      Appraisers shall be conclusive evidence of such qualification.

            Independent Director. A Director of the Company who is not
      associated and has not been associated within the last two years, directly
      or indirectly, with the Sponsor or the Advisor. A Director shall be deemed
      to be associated with the Sponsor or the Advisor if he or she: (i) owns an
      interest in, is employed by, has any material business or professional
      relationship with, or is an officer or director of, the Sponsor, the
      Advisor, or any of their Affiliates, other than as a director or trustee
      or officer of not more than two other REITs organized by the Sponsor or
      advised by the Advisor; or (ii) performs services, other than as a
      Director, for the Company. An indirect relationship shall include
      circumstances in which a Director's spouse, parents, children, siblings,
      mothers- or fathers-in-law, sons- or daughters-in-law, or brothers- or
      sisters-in-law is or has been associated with the Sponsor, the Advisor,
      any of their Affiliates or the Company.

            Individual. Any natural person and those organizations treated as
      natural persons in Section 542(a) of the Code.

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            Initial Closing Date. The first date on which purchasers of Shares
      offered pursuant to the Prospectus were issued such Shares.

            Initial Investor Capital. The total amount of capital invested from
      time to time by Shareholders (computed at a rate of $10 per Share for
      every Share including those Shares for which reduced selling commissions
      were paid in connection with their purchase from the Company). Upon
      completion of the Offering, the Initial Investor Capital shall be equal to
      the Gross Offering Proceeds.

            Loan Refinancing Fee. The Loan Refinancing Fee as defined in Section
      9(e) hereof.

            Loans. The notes and other evidences of indebtedness or obligations
      acquired or entered into by the Company as lender which are secured or
      collateralized by personal property, or fee or leasehold interests in real
      estate or other assets, including but not limited to first or subordinate
      mortgage loans, construction loans, development loans, loans secured by
      capital stock or any other assets or form of equity interest and any other
      type of loan or financial arrangement, such as providing or arranging for
      letters of credit, providing guarantees of obligations to third parties,
      or providing commitments for loans. The term "Loans" shall not include
      leases which are not recognized as leases for Federal income tax reporting
      purposes.

            Nasdaq. The national automated quotation system operated by the
      National Association of Securities Dealers, Inc.

            Net Income. For any period, the total revenues applicable to such
      period, less the total expenses applicable to such period excluding
      additions to reserves for depreciation, bad debts or other similar
      non-cash reserves; provided, however, Net Income for purposes of
      calculating total allowable Operating Expenses shall exclude the gain from
      the sale of the Company's assets.

            Offering. The offering of Shares pursuant to the Prospectus.

            Operating Expenses. All operating, general and administrative
      expenses paid or incurred by the Company, as determined under generally
      accepted accounting principles, except the following: (i) interest and
      discounts and other cost of borrowed money; (ii) taxes (including state
      and Federal income tax, property taxes and assessments, franchise taxes
      and taxes of any other nature); (iii) expenses of raising capital,
      including Organization and Offering Expenses, printing, engraving, and
      other expenses, and taxes incurred in connection with the issuance and
      distribution of the Company's Shares and Securities; (iv) expenses
      connected with the acquisition, disposition, ownership and operation of
      real estate interests, mortgage loans, or other property, including the
      costs of foreclosure, insurance premiums, legal services, brokerage and
      sales commissions, maintenance, repair and improvement of property; (v)
      the Acquisition Fee or Subordinated Disposition Fee payable to the Advisor
      or any other party; and (vi) non-cash items, such as depreciation,
      amortization, depletion, and additions to reserves for depreciation,
      amortization, depletion, losses and bad debts. Notwithstanding anything
      herein to the contrary, Operating Expenses shall include the Asset
      Management Fee, the Performance Fee and the Loan Refinancing Fee.

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            Organization and Offering Expenses. Those expenses payable by the
      Company in connection with the formation, qualification and registration
      of the Company and in marketing and distributing Shares, including, but
      not limited to: (i) the preparation, printing, filing and delivery of the
      Registration Statement and the Prospectus (including any amendments
      thereof or supplements thereto) and the preparing and printing of
      contractual agreements between the Company and the Sales Agent and the
      Selected Dealers (including copies thereof); (ii) the preparing and
      printing of the Articles of Incorporation and Bylaws, solicitation
      material and related documents and the filing and/or recording of such
      documents necessary to comply with the laws of the State of Maryland for
      the formation of a corporation and thereafter for the continued good
      standing of a corporation; (iii) the qualification or registration of the
      Shares under state securities or "Blue Sky" laws; (iv) any escrow
      arrangements, including any compensation to an escrow agent; (v) the
      filing fees payable to the SEC and to the National Association of
      Securities Dealers, Inc.; (vi) reimbursement for the reasonable and
      identifiable out-of-pocket expenses of the Sales Agent and the Selected
      Dealers, including the cost of their counsel; (vii) the fees of the
      Company's counsel; (viii) all advertising expenses incurred in connection
      with the Offering, including the cost of all sales literature and the
      costs related to investor and broker-dealer sales and information meetings
      and marketing incentive programs; and (ix) selling commissions, certain
      annual monitoring fees paid to the Sales Agent with respect to Shares sold
      to clients of the Sales Agent or Selected Dealers, marketing fees,
      incentive fees, due diligence fees and wholesaling fees and expenses
      incurred in connection with the sale of the Shares.

            Performance Fee. The Performance Fee as defined in Section 9(b).

            Person. An Individual, corporation, partnership, joint venture,
      association, company, trust, bank, or other entity, or government or any
      agency or political subdivision of a government.

            Preferred Return. A Cumulative Return of six percent computed from
      the Initial Closing Date through the date as of which such amount is being
      calculated.

            Property or Properties. The Company's partial or entire interest in
      real property (including leasehold interests) and personal or mixed
      property connected therewith.

            Property Management Fee. The Property Management Fee as defined in
      Section 9(f) hereof.

            Prospectus. The final prospectus of the Company pursuant to which
      the Company offered up to 69,000,000 Shares, as the same may from time to
      time have been amended or supplemented after the effective date of the
      Registration Statement.

            Registration Statement. The Registration Statement on Form S-11 of
      which the Prospectus is a part.

            REIT. A real estate investment trust, as defined in Sections 856-860
      of the Code.

            Sales Agent. Carey Financial Corporation.

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            Securities. Any stock, shares (other than currently outstanding
      Shares and subsequently issued shares of common stock of the Company),
      voting trust certificates, bonds, debentures, notes or other evidences of
      indebtedness, secured or unsecured, convertible, subordinated or otherwise
      or in general any instruments commonly known as "securities" or any
      certificate of interest, shares or participation in temporary or interim
      certificates for receipts (or, guarantees of, or warrants, options or
      rights to subscribe to, purchase or acquire any of the foregoing), which
      subsequently may be issued by the Company.

            Selected Dealer Fee. A due diligence and management fee payable to
      Selected Dealers by the Company (through the Sales Agent) of up to one
      percent of the price of each Share sold by those Selected Dealers to which
      the Sales Agent agrees to pay such due diligence and management fee.

            Selected Dealers. Broker-dealers who are members of the National
      Association of Securities Dealers, Inc. and who have executed an agreement
      with the Sales Agent in which the Selected Dealers agree to participate
      with the Sales Agent in the Offering.

            Selected Investment Advisors. An investment advisor under the
      Investment Advisers Act of 1940, as amended, and presently registered or
      licensed as an investment advisor by the appropriate regulatory agency of
      each state in which the advisor has clients, or exempt from each state's
      registration requirements. The advisor is not a registered broker-dealer
      or registered representative with the NASD. The advisor is in compliance
      with all applicable federal and state securities laws. The advisor
      maintains the records, required by Section 204 of the Investment Advisers
      Act of 1940, as amended, and rule 204-2 thereunder, in the form and for
      the periods required thereby.

            Shareholders. Those Persons who at any particular time are shown as
      holders of record of Shares on the books and records of the Company.

            Shares. All of the shares of common stock of the Company, $.001 par
      value, and all other shares of common stock of the Company issued in the
      Offering or any subsequent offering.

            Sponsor. W. P. Carey & Co. LLC and any other person directly or
      indirectly instrumental in organizing, wholly or in part, the Company or
      any person who will manage or participate in the management of the
      Company, and any Affiliate of any such person. Sponsor does not include a
      person whose only relationship to the Company is that of an independent
      property manager and whose only compensation is as such. Sponsor also does
      not include wholly independent third parties such as attorneys,
      accountants and underwriters whose only compensation is for professional
      services.

            Subordinated Acquisition Fee. The Subordinated Acquisition Fee as
      defined in Section 9(d).

            Subordinated Disposition Fee. The Subordinated Disposition Fee as
      defined in Section 9(g) hereof.

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            Subordinated Incentive Fee. The Subordinated Incentive Fee as
      defined in Section 9(h) hereof.

            Termination Date. The effective date of any termination of this
      Agreement.

            Termination Fee. An amount equal to 15% of the amount, if any, by
      which (1) the Appraised Value of the Properties on the Termination Date,
      less the amount of all indebtedness secured by such Properties, exceeds
      (2) the total of the Initial Investor Capital on the Final Closing Date
      plus an amount equal to the Preferred Return through the Termination Date
      reduced by the total Dividends paid by the Company from its inception
      through the Termination Date.

            Total Property Cost. With regard to any Property, an amount equal to
      the sum of the Contract Purchase Price of such Property plus the
      Acquisition Fees paid in connection with such Property.

            2%/25% Guidelines. The requirement that, in any 12-month period, the
      Operating Expenses not exceed the greater of two percent of the Company's
      Average Invested Assets during such 12-month period or 25% of the
      Company's Net Income over the same 12-month period.

            Underlying Real Property. Property serving as collateral for any
      Loan.

            Valuation. An estimate of value of the assets of the Company as
      determined by a Person approved by the Independent Directors, which Person
      shall be independent of the Company and the Advisor.

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

      3. DUTIES OF THE ADVISOR. The Advisor undertakes to use its best efforts
to present to the Company potential investment opportunities and to provide a
continuing and suitable investment program consistent with the investment
objectives and policies of the Company as determined and adopted from time to
time by the Directors. In performance of this undertaking, subject to the
supervision of the Directors and consistent with the provisions of the
Registration Statement, Articles of Incorporation and Bylaws of the Company, the
Advisor shall, either directly or by engaging an Affiliate:

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

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

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

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

            (e) subject to the provisions of Sections 3(g) and 4 hereof: (i)
locate, analyze and select potential investments in Property and Loans; (ii)
structure and negotiate the terms and conditions of transactions pursuant to
which investments in Properties and Loans will be made, purchased or acquired by
the Company; (iii) make investments in Property on behalf of the Company in
compliance with the investment objectives and policies of the Company; (iv)
arrange for financing, and refinancing and make other changes in the asset or
capital structure of, and dispose of, reinvest the proceeds from the sale of or
otherwise deal with the investments in Property and Loans; and (v) enter into
leases and service contracts for Properties and, to the extent necessary,
perform all other operational functions for the maintenance and administration
of such Properties;

            (f) provide the Directors with periodic reports regarding
prospective investments in Properties and Loans;

            (g) obtain the prior approval of the Directors (including a majority
of the Independent Directors) for any and all investments in Property which do
not meet all of the requirements set forth in Section 4(b) hereof;

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

            (i) obtain reports (which may be prepared by the Advisor or its
Affiliates), where appropriate, concerning the value of investments or
contemplated investments of the Company in Property and/or Loans;

            (j) obtain for, or provide to, the Company such services as may be
required in acquiring, managing and disposing of Company Property and/or Loans,
including, but not limited to: (i) the negotiation, making and servicing of
Loans; (ii) the disbursement and

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collection of Company monies; (iii) the payment of debts of and fulfillment of
the obligations of the Company; and (iv) the handling, prosecuting and settling
of any claims of or against the Company, including, but not limited to,
foreclosing and otherwise enforcing mortgages and other liens securing the
Loans;

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

            (l) communicate on behalf of the Company with Shareholders as
required to satisfy the reporting and other requirements of any governmental
bodies or agencies to Shareholders and third parties and otherwise as requested
by the Company;

            (m) provide or arrange for administrative services and items, legal
and other services, office space, office furnishings, personnel and other
overhead items necessary and incidental to the Company's business and
operations;

            (n) provide the Company with such accounting data and any other
information so requested concerning the investment activities of the Company as
shall be required to prepare and to file all periodic financial reports and
returns required to be filed with the Securities and Exchange Commission and any
other regulatory agency, including annual financial statements;

            (o) maintain the books and records of the Company;

            (p) supervise the performance of such ministerial and administrative
functions as may be necessary in connection with the daily operations of the
Properties and Loans;

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

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

            (s) perform such other services as may be required from time to time
for management and other activities relating to the assets of the Company as the
Advisor shall deem advisable under the particular circumstances;

            (t) deliver to or maintain on behalf of the Company copies of all
appraisals obtained in connection with investments in Properties and Loans; and

      4. AUTHORITY OF ADVISOR.

            (a) Pursuant to the terms of this Agreement (including the
restrictions included in this Section 4 and in Section 7 hereof), and subject to
the continuing and exclusive authority of the Directors over the management of
the Company, the Directors hereby delegate to the Advisor the authority to: (1)
locate, analyze and select investment opportunities; (2) structure the terms and
conditions of transactions pursuant to which investments will be made or
acquired for the Company; (3) acquire Property and make Loans in compliance with
the investment objectives and policies of the Company; (4) arrange for financing
or refinancing, or make changes in the

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asset or capital structure of, and dispose of or otherwise deal with, Property
and Loans; (5) enter into leases and service contracts for Properties, and
perform other property level operations; (6) oversee non-affiliated property
managers and other non-affiliated Persons who perform services for the Company;
and (7) undertake accounting and other record-keeping functions at the Property
level.

            (b) Notwithstanding the foregoing, any investment in Property,
including any acquisition of any Property by the Company (as well as any
financing acquired by the Company in connection with such acquisition), will
require the prior approval of the Directors unless, prior to completion of any
such transaction, the Advisor provides the Company with:

                  (i) an appraisal for the Property indicating that the Total
      Property Cost of the Property does not exceed the Appraised Value of the
      Property; and

                  (ii) a representation from the Advisor that the Property, in
      conjunction with the Company's other investments and proposed investments,
      at the time the Company is committed to purchase the Property, is
      reasonably expected to fulfill the Company's investment objectives and
      policies as established by the Directors and then in effect.

            (c) If a transaction requires approval by the Independent Directors,
the Advisor will deliver to the Independent Directors all documents required by
them to properly evaluate the proposed investment in such Property or such Loan.

      Notwithstanding the foregoing, the prior approval of the Directors,
including a majority of the Independent Directors, will be required for
transactions involving: (a) investments in Properties in respect of which all of
the requirements specified in Section 4(b) hereof have not been satisfied; (b)
investments in Properties made through joint venture arrangements with
Affiliates of the Advisor; (c) investments in Properties which are not
contemplated by the terms of the Prospectus; (d) transactions that present
issues which involve conflicts of interest for the Advisor (other than conflicts
involving the payment of fees or the reimbursement of expenses); and (e) the
lease of assets to the Sponsor, any Director or the Advisor.

      The Directors may, at any time upon the giving of notice to the Advisor,
modify or revoke the authority set forth in this Section 4. If and to the extent
the Directors so modify or revoke the authority contained herein, the Advisor
shall henceforth submit to the Directors for prior approval such proposed
transactions involving investments in Property as thereafter require prior
approval, provided however, that such modification or revocation shall be
effective upon receipt by the Advisor and shall not be applicable to investment
transactions to which the Advisor has committed the Company prior to the date of
receipt by the Advisor of such notification.

      5. BANK ACCOUNTS. The Advisor may establish and maintain one or more bank
accounts in its own name for the account of the Company or in the name of the
Company and may collect and deposit into any such account or accounts, and
disburse from any such account or accounts, any money on behalf of the Company,
provided that no funds shall be commingled with the funds of the Advisor; and
the Advisor shall from time to time render appropriate

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accountings of such collections and payments to the Directors and to the
auditors of the Company.

      6. RECORDS; ACCESS. The Advisor shall maintain appropriate records of all
its activities hereunder and make such records available for inspection by the
Directors and by counsel, auditors and authorized agents of the Company, at any
time or from time to time during normal business hours. The Advisor shall at all
reasonable times have access to the books and records of the Company.

      7. LIMITATIONS ON ACTIVITIES. Anything else in this Agreement to the
contrary notwithstanding, the Advisor shall refrain from taking any action
which, in its sole judgment made in good faith, would adversely affect the
status of the Company as a REIT, subject the Company to regulation under the
Investment Company Act of 1940, would violate any law, rule, regulation or
statement of policy of any governmental body or agency having jurisdiction over
the Company, its Shares or its Securities, or otherwise not be permitted by the
Articles of Incorporation or Bylaws, except if such action shall be ordered by
the Directors, in which case the Advisor shall notify promptly the Directors of
the Advisor's judgment of the potential impact of such action and shall refrain
from taking such action until it receives further clarification or instructions
from the Directors. In such event the Advisor shall have no liability for acting
in accordance with the specific instructions of the Directors so given.
Notwithstanding the foregoing, the Advisor, its partners and employees, and
partners, stockholders, directors and officers of the Advisor's partners shall
not be liable to the Company, or to the Directors or Shareholders for any act or
omission by the Advisor, its partners or employees, or partners, stockholders,
directors or officers of the Advisor's partners except as provided in Sections
20 and 22 hereof.

      8. RELATIONSHIP WITH DIRECTORS. Partners and employees of the Advisor or
partners in the Advisor or any corporate parents of a partner, or directors,
officers or stockholders of any partner or corporate parent of a partner may
serve as a Director and as officers of the Company, except that no partner in or
employee of the Advisor or its Affiliates who also is a Director or officer of
the Company shall receive any compensation from the Company for serving as a
Director or officer other than for reasonable reimbursement for travel and
related expenses incurred in attending meetings of the Directors.

      9. FEES.

            (a) ASSET MANAGEMENT FEE. The Company shall pay to the Advisor as
compensation for the advisory services rendered to the Company hereunder an
amount equal to one half percent per annum of the Average Invested Assets of the
Company (the "Asset Management Fee") calculated as set forth below. The Asset
Management Fee will be calculated monthly, beginning with the month in which the
Company first makes an investment in Properties or Loans, on the basis of
one-twelfth of one half percent of the Average Invested Assets for the preceding
month, computed as a daily average. The Asset Management Fee calculated with
respect to each month shall be payable monthly on the last day of such month, or
the first business day following the last day of such month. If at the end of
any fiscal quarter, the Company's Operating Expenses exceed the 2%/25%
Guidelines over the immediately preceding 12 months, payment of the Asset
Management Fee will be withheld to the extent necessary to cause the Company to
satisfy the 2%/25% Guidelines. Any portion of the Asset Management

                                      -15-

<PAGE>

Fee not paid due to the Company's failure to satisfy the 2%/25% Guidelines shall
be paid at the end of the next fiscal quarter to the extent such payment would
not cause the Company to fail to satisfy the 2%/25% Guidelines if such payment
were to be included in the Company's Operating Expenses for the 12 months
preceding such payment. For purposes of calculating the value per share of
restricted stock given for payment of the Asset Management Fee, the price per
share shall be: (i) the net asset value per share as determined by the most
recent appraisal performed by an independent third party or, if an appraisal has
not yet been performed, (ii) $10 per share. Any part of the Asset Management Fee
that has been subordinated pursuant to this subsection (a) shall not be deemed
earned until such time as payable hereunder.

            (b) PERFORMANCE FEE. In addition to the Asset Management Fee
described in Section 9(a) above, the Company shall also pay to the Advisor as
compensation for the advisory services rendered to the Company hereunder an
amount equal to one half percent per annum of the Average Invested Assets of the
Company (the "Performance Fee") calculated as set forth below. The Performance
Fee will be calculated monthly, beginning with the month in which the Company
first makes an investment in Properties or Loans, on the basis of one-twelfth of
one half percent of the Average Invested Assets during the previous month,
computed as a daily average. The Performance Fee calculated with respect to each
month shall be payable on a quarterly basis on the last day of the first month
of the immediately following fiscal quarter. Payment of this fee for any quarter
shall be payable only if the Shareholders have received a Preferred Return. Any
portion of the Performance Fee not paid due to the Company's failure to pay the
Preferred Return shall be paid by the Company, to the extent it is not
restricted by the 2%/25% Guidelines as described below, at the end of the next
fiscal quarter through which the Company has paid the Preferred Return. If at
the end of any fiscal quarter, the Company's Operating Expenses exceed the
2%/25% Guidelines over the immediately preceding 12 months, payment of the
Performance Fee will be withheld to the extent necessary to cause the Company to
satisfy the 2%/25% Guidelines. Any portion of the Performance Fee not paid due
to the Company's failure to satisfy the 2%/25% Guidelines shall be paid at the
end of the next fiscal quarter to the extent such payment would not cause the
Company to fail to satisfy the 2%/25% Guidelines if such payment were to be
included in the Company's Operating Expenses for the 12 months preceding such
payment. For purposes of determining the Performance Fee, the price per share
shall be: (i) the net asset value per share as determined by the most recent
appraisal performed by an independent third party or, if an appraisal has not
yet been performed, (ii) $10 per share. Any part of the Performance Fee that has
been subordinated pursuant to this subsection (b) shall not be deemed earned
until such time as payable hereunder.

            (c) ACQUISITION FEE. The Advisor may receive as compensation for
services rendered in connection with the investigation, selection and
acquisition (by purchase, investment or exchange) of Property an Acquisition Fee
payable by the Company. The total Acquisition Fees (not including Subordinated
Acquisition Fees and any interest thereon) payable to the Advisor may not exceed
two-and-a-half percent of the aggregate Total Property Cost of all Properties
purchased by the Company with proceeds from the Offering (calculated after all
such proceeds are invested) unless a majority of the Directors (including a
majority of the Independent Directors) not otherwise interested in any
transaction approve the excess as being commercially competitive, fair and
reasonable to the Company. The total amount of Acquisition Fees (including
Subordinated Acquisition Fees and any interest thereon) and Acquisition Expenses
paid by the Company may not exceed six percent of the aggregate Contract
Purchase Price of all Properties purchased by the Company unless a majority of
the Board (including a

                                      -16-

<PAGE>

majority of the Independent Directors) not otherwise interested in any
transaction approves fees in excess of this limit as being commercially
competitive, fair and reasonable to the Company.

            (d) SUBORDINATED ACQUISITION FEE. In addition to the Acquisition Fee
described in Section 9(c) above, the Advisor may receive as additional
compensation for services rendered in connection with the investigation,
selection and acquisition (by purchase, investment or exchange) of a Property a
Subordinated Acquisition Fee payable by the seller of such Property or the
Company. The total Subordinated Acquisition Fees payable to the Advisor and its
Affiliates plus Subordinated Acquisition Fees payable by the Company to any
other party may not exceed two percent of the aggregate Total Property Cost of
all Properties purchased by the Company with proceeds from the Offering
(calculated after all such proceeds are invested) unless a majority of the
Directors (including a majority of the Independent Directors) not otherwise
interested in any transaction approve the excess as being commercially
competitive, fair and reasonable to the Company. The unpaid portion of the
Subordinated Acquisition Fee with respect to any Property shall bear interest at
the rate of six percent per annum from the date of acquisition of such Property
until such portion is paid. Subject to the following sentence, the Subordinated
Acquisition Fee with respect to any Property shall be payable in equal annual
installments on January 1 of each of the four calendar years following the first
anniversary of the date such Property was purchased; accrued interest or all
unpaid Subordinated Acquisition Fees shall also be payable on such dates. The
portion of the Subordinated Acquisitions Fees, and accrued interest thereon,
otherwise payable for any year on January 1 of the following year shall be
payable only if the Shareholders have received a Preferred Return. Any portion
of the Subordinated Acquisitions Fees, and accrued interest thereon, not paid
due to the Company's failure to pay the Preferred Return for the most recently
completed fiscal year shall be paid by the Company on January 1 following the
fiscal year through which the Company has paid the Preferred Return. In the
event that the Shares are listed for trading on a national securities exchange
or are included for quotation on Nasdaq, all Subordinated Acquisition Fees, and
accrued interest thereon, shall be due and payable on the date of such listing
or inclusion.

            (e) LOAN REFINANCING FEE. The Company shall pay to the Advisor for
all qualifying loan refinancings of Properties a Loan Refinancing Fee in the
amount up to one percent of the principal amount of any loan secured by a
Property. Any Loan Refinancing Fee shall be due and payable upon the funding of
the related mortgage loan or as soon thereafter as is reasonably practicable. A
refinancing will qualify for a Loan Refinancing Fee only if: the new loan is
approved by a majority of the independent directors and found to be in the best
interest of the Company, the terms of the new loan represent an improvement over
the terms of the refinanced loan, the new loan materially increases the total
debt secured by a particular Property or the maturity date of the refinanced
loan (which must have a term of five years or more) is less than one year from
the date of the refinancing.

            (f) PROPERTY MANAGEMENT FEE. The Advisor may cause the Company to
pay Property Management Fees for property management services rendered by the
Advisor or its Affiliates in connection with Properties acquired directly or
through foreclosure. The Advisor or an Affiliate will provide property
management services only if a Property becomes vacant or requires more active
management than contemplated at the time such Property is acquired. In either
event, the Company, by approval of the Directors (including a majority of the
Independent Directors), may engage the Advisor or an Affiliate, subject to such
Advisor's or such Affiliate's qualifying as an "independent contractor" pursuant
to Section 856(d)(3) of the Code, to provide

                                      -17-

<PAGE>

property management services. If such services are rendered by the Advisor or an
Affiliate, the maximum Property Management Fees which may be paid to the Advisor
or an Affiliate will be six percent of gross revenues from commercial Properties
and five percent of gross revenues from residential Properties, plus reimbursed
expenses, paid monthly, where such entity performs property management and
leasing, re-leasing and leasing related services, or three percent of the gross
revenues of the Property if only property management services are performed by
such entity. Property Management Fees payable to the Advisor or an Affiliate for
an industrial or commercial Property leased on a long-term (defined as at least
ten years, excluding renewals) triple net basis, may not exceed one percent of
the gross revenues from such Property, except for a one-time initial leasing fee
equal to three percent of total base rents payable for the first five years of
the lease, payable in five equal annual installments. Such fees to the Advisor
or its Affiliate cannot exceed the usual and customary amounts charged for
similar services in the same geographic area.

            (g) SUBORDINATED DISPOSITION FEE. If the Advisor or an Affiliate
provides a substantial amount of the services (as determined by a majority of
the Independent Directors) in the sale of a Property, the Advisor or an
Affiliate shall receive a Subordinated Disposition Fee equal to the lesser of:
(i) 50% of the Competitive Real Estate Commission and (ii) three percent of the
Contract Sales Price of such Property. The Subordinated Disposition Fee will be
paid only if Shareholders have received a return of 100% of Initial Investor
Capital (through liquidity or distributions) plus an annual Cumulative Return of
six percent from the date shares were purchased from the Company through the
date payment is made. The return requirement will be deemed satisfied if the
total distributions paid by CPA(R):15 satisfy the six percent annual Cumulative
Return requirement and the market value of CPA(R):15 equals or exceeds 100% of
the capital raised by CPA(R):15 (less any amounts distributed from the sale of
refinancing of any property). To the extent that Subordinated Disposition Fees
are not paid by the Company on a current basis due to the foregoing limitation,
the unpaid fees will be accrued and paid at such time as the limitation has been
satisfied. The Subordinated Disposition Fee may be paid in addition to real
estate commissions paid to non-Affiliates, provided that the total real estate
commissions paid to all Persons by the Company shall not exceed an amount equal
to the lesser of: (i) six percent of the Contract Sales Price of a Property or
(ii) the Competitive Real Estate Commission. In the event this Agreement is
terminated prior to such time as the Shareholders have received a return of 100%
of Initial Investor Capital plus an amount sufficient to pay a Cumulative Return
of six percent from the date shares were purchased from the Company through the
date of termination of this Agreement, an appraisal of the Properties then owned
by the Company shall be made and the Subordinated Disposition Fee on Properties
previously sold will be deemed earned if the Appraised Value of the Properties
then owned by the Company plus return to Shareholders received prior to the date
of termination of this Agreement is equal to 100% of Initial Investor Capital
(through liquidity or distributions) plus an amount sufficient to pay a
Cumulative Return of six percent from the date shares were purchased from the
Company through the date of termination of this Agreement. In the event the
Company's Shares are listed on a national securities exchange or included for
quotation on Nasdaq and, at the time of such listing, the Advisor has accrued a
Subordinated Disposition Fee which has not been paid, for purposes of
determining whether the subordination conditions have been satisfied,
Shareholders will be deemed to have received a Dividend in an amount equal to
the product of the total number of outstanding Shares and the average of the
closing prices (or average bid and asked quotes) of the Shares over a period,
beginning 180 days after listing of the Shares, of 30 days during which the
Shares are traded.

                                      -18-

<PAGE>

            (h) SUBORDINATED INCENTIVE FEE. The Subordinated Incentive Fee shall
be payable to the Advisor in an amount equal to 15% of Cash from Sales and
Financings distributed to the Shareholders after the Shareholders have received
a return of 100% of Initial Investor Capital (through liquidity or
distributions) plus an annual Cumulative Return of six percent from the date
shares were purchased from the Company through date payment is made. Once
Shareholders have been provided with liquidity the Advisor will be paid any
Subordinated Incentive Fee and any Subordinated Disposition Fee it has earned
and does earn if the return requirements are satisfied. For these purposes
Shareholder will be deemed to have been provided liquidity if the Shares are
listed on a national security exchange or over-the-counter market, included for
quotation on Nasdaq, if shares can be redeemed through the CPA(R):15 redemption
plan on a quarterly basis without delay or some other liquidity terms has been
provided which enables Shareholders to receive cash or marketable securities for
their Shares no less frequently than quarterly. The return requirement will be
deemed satisfied if the total distributions paid by CPA(R):15 satisfy the six
percent annual Cumulative Return requirement and the market value of CPA(R):15
equals or exceeds 100% of the capital raised by CPA(R):15 (less any amounts
distributed from the sale of refinancing of any property). The market value will
be calculated on the basis of the average market value of the Shares over the 30
trading days beginning 180 days after the Shares are first listed on a stock
exchange if the Shares are listed or included for quotation. If liquidity is
provided through the redemption plan, the value of CPA(R):15 will be the
redemption price, net of any surrender fee, multiplied by the total number of
outstanding Shares. A similar measurement will be used for other forms of
liquidity. The Company shall have the option to pay such fee in the form of
cash, a promissory note or any combination thereof. The promissory note shall be
fully amortizing over five years, provide for quarterly payments and bear
interest at the prime rate announced from time to time in The Wall Street
Journal.

            (i) LOANS FROM AFFILIATES. If any loans are made to the Company by
the Advisor or an Affiliate of the Advisor, the maximum amount of interest that
may be charged by such Affiliate shall be the lesser of (i) one percent above
the prime rate of interest published in The Wall Street Journal and (ii) the
rate that would be charged to the Company by unrelated lending institutions on
comparable loans for the same purpose in the locality of the Property. The terms
of any such loans shall be no less favorable than the terms available between
non-Affiliated Persons for similar commercial loans.

            (j) CHANGES TO FEE STRUCTURE. In the event the Shares are listed on
a national securities exchange or are included for quotation on Nasdaq, the
Company and the Advisor shall negotiate in good faith to establish a fee
structure appropriate for a entity with a perpetual life. A majority of the
Independent Directors must approve the new fee structure negotiated with the
Advisor. In negotiating a new fee structure, the Independent Directors shall
consider all of the factors they deem relevant, including but not limited to:
(a) the size of the Advisory Fee in relation to the size, composition and
profitability of the Company's portfolio; (b) the success of the Advisor in
generating opportunities that meet the investment objectives of the Company; (c)
the rates charged to other REITs and to investors other than REITs by Advisors
performing similar services; (d) additional revenues realized by the Advisor and
its Affiliates through their relationship with the Company, including loan
administration, underwriting or broker commissions, servicing, engineering,
inspection and other fees, whether paid by the Company or by others with whom
the Company does business; (e) the quality and extent of service and

                                      -19-
<PAGE>

advice furnished by the Advisor; (f) the performance of the investment portfolio
of the Company, including income, conversion or appreciation of capital,
frequency of problem investments and competence in dealing with distress
situations; and (g) the quality of the portfolio of the Company in relationship
to the investments generated by the Advisor for its own account. The new fee
structure can be no more favorable to the Advisor than the current fee
structure.

           (k) PAYMENT. Compensation payable to the Advisor pursuant to this
Section 9 shall be paid in cash; provided, however, that any fees payable
pursuant to Section 9 may be paid, at the option of the Advisor, in the form of:
(i) cash, (ii) common stock of the Company, or (iii) a combination of cash and
common stock. The Advisor shall notify the Company in writing of the form in
which the fee shall be paid. Such notice shall be provided no later than January
15 of each year. If no such notice is provided, the fee shall be paid in cash.
For purposes of the payment of compensation to the Advisor in the form of stock,
the value of each share of common stock shall be: (i) the Net Asset Value per
Share as determined by the most recent appraisal of the Company's assets
performed as of the end of the immediately preceding year by an Independent
Appraiser, or (ii) if an appraisal has not yet been performed, $10 per share.
The Net Asset Value determined on the basis of such appraisal may be adjusted on
a quarterly basis by the Board of Directors of the Company to account for
significant capital transactions. Fees paid in the form of stock shall be paid
pursuant to the terms of the form of the Restricted Stock Agreement attached
hereto as Exhibit A or such other terms as the Advisor and the Company may from
time to time agree.

      10. EXPENSES. In addition to the compensation paid to the Advisor pursuant
to Section 9 hereof, the Company shall pay directly or reimburse the Advisor for
the following expenses:

            (i) Acquisition Expenses incurred in connection with the initial
      investment of the funds of the Company;

            (ii) expenses other than Acquisition Expenses incurred in connection
      with the investment of the funds of the Company;

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

            (iv) taxes and assessments on income or Property and taxes as an
      expense of doing business;

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

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

            (vii) fees and expenses of legal counsel for the Company;

                                      -20-

<PAGE>

            (viii) fees and expense of non-affiliated auditors and accountants
      for the Company;

            (ix) all expenses in connection with payments to the Directors and
      meetings of the Directors and Shareholders;

            (x) expenses associated with listing the Shares and Securities on a
      securities exchange or Nasdaq if requested by the Directors or with the
      issuance and distribution of Shares and Securities, such as selling
      commissions and fees, taxes, legal and accounting fees, listing and
      registration fees, and other Organization and Offering Expenses;

            (xi) expenses connected with payments of Dividends in cash or
      otherwise made or caused to be made by the Directors to the Shareholders;

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

            (xiii) expenses of maintaining communications with Shareholders,
      including the cost of preparation, printing and mailing annual reports and
      other Shareholder reports, proxy statements and other reports required by
      governmental entities;

            (xiv) expenses related to the Properties and Loans and other fees
      relating to making investments including personnel and other costs
      incurred in Property or Loan transactions where a fee is not payable to
      the Advisor; and

            (xv) all other expenses the Advisor incurs in connection with
      providing services to the Company including reimbursement to the Advisor
      or its Affiliates for the cost of rent, goods, materials and personnel
      incurred by them based upon the compensation of the Persons involved and
      an appropriate share of overhead allocable to those Persons.

      No reimbursement shall be made for the cost of personnel to the extent
that such personnel are used in transactions for which the Advisor receives a
separate fee.

      Expenses incurred by the Advisor on behalf of the Company and payable
pursuant to this Section 10 shall be reimbursed quarterly to the Advisor within
60 days after the end of each quarter. The Advisor shall prepare a statement
documenting the expenses of the Company during each quarter, and shall deliver
such statement to the Company within 45 days after the end of each quarter.

      11. OTHER SERVICES. Should the Directors request that the Advisor or any
partner or employee thereof render services for the Company other than set forth
in Section 3 hereof, such services shall be separately compensated and shall not
be deemed to be services pursuant to the terms of this Agreement.

                                      -21-

<PAGE>

      12. FIDELITY BOND. The Advisor shall maintain a fidelity bond for the
benefit of the Company which bond shall insure the Company from losses of up to
$5,000,000 and shall be of the type customarily purchased by entities performing
services similar to those provided to the Company by the Advisor.

      13. REFUND BY ADVISOR. (a) Within 60 days after the end of any fiscal
quarter of the Company which begins following the date the Company first
commences operations, if Operating Expenses of the Company during the fiscal
year, ending at the end of such quarter exceed the greater of (a) two percent of
the Average Invested Assets or (b) 25% of the Net Income of the Company during
that fiscal year and a majority of the Independent Directors find this excess
amount justified based on such unusual and non-recurring factors which they deem
sufficient, the Advisor may be reimbursed in future years for the full amount of
such excess expenses, or any portion thereof, but only to the extent such
reimbursement would not cause the Company's Operating Expenses to exceed the
2%/25% Guidelines in any such year. In no event shall the Operating Expenses
paid by the Company in any twelve month period ending at the end of a fiscal
quarter exceed the 2%/25% Guidelines. All figures used in the foregoing
computation shall be determined in accordance with generally accepted accounting
principles applied on a consistent basis. If the Advisor receives an incentive
fee for the sale of Property, Net Income, for purposes of calculating the
Operating Expenses, shall exclude the gain from the sale of such Property.

            (b) To the extent Organizational and Offering Expenses payable by
the Company exceeds 10.5% of the Gross Offering Proceeds, the excess will be
paid by the Advisor.

      14. OTHER ACTIVITIES OF THE ADVISOR. Nothing herein contained shall
prevent the Advisor from engaging in other activities, including without
limitation the rendering of advice to other investors (including other REITs)
and the management of other programs advised, sponsored or organized by the
Advisor or its Affiliates; nor shall this Agreement limit or restrict the right
of any director, officer, employee, partner or shareholder of the Advisor or its
Affiliates to engage in any other business or to render services of any kind to
any other partnership, corporation, firm, individual, trust or association. The
Advisor may, with respect to any investment in which the Company is a
participant, also render advice and service to each and every other participant
therein. The Advisor shall report to the Directors the existence of any
condition or circumstance, existing or anticipated, of which it has knowledge,
which creates or could create a conflict of interest between the Advisor's
obligations to the Company and its obligations to or its interest in any other
partnership, corporation, firm, individual, trust or association. The Advisor or
its Affiliates shall promptly disclose to the Directors knowledge of such
condition or circumstance. If the Sponsor, Advisor, Director or Affiliates
thereof have sponsored other investment programs with similar investment
objectives which have investment funds available at the same time as the
Company, it shall be the duty of the Directors (including the Independent
Directors) to adopt the method set forth in the Registration Statement or
another reasonable method by which properties are to be allocated to the
competing investment entities and to use their best efforts to apply such method
fairly to the Company.

      The Advisor shall be required to use its best efforts to present a
continuing and suitable investment program to the Company which is consistent
with the investment policies and objectives of the Company, but neither the
Advisor nor any Affiliate of the Advisor shall be

                                      -22-

<PAGE>

obligated generally to present any particular investment opportunity to the
Company even if the opportunity is of character which, if presented to the
Company, could be taken by the Company.

      In the event that the Advisor or its Affiliates is presented with a
potential investment which might be made by the Company and by another
investment entity which the Advisor or its Affiliates advises or manages, the
Advisor shall consider the investment portfolio of each entity, cash flow of
each entity, the effect of the acquisition on the diversification of each
entity's portfolio, rental payments during any renewal period, the estimated
income tax effects of the purchase on each entity, the policies of each entity
relating to leverage, the funds of each entity available for investment, the
amount of equity required to make the investment and the length of time such
funds have been available for investment. To the extent that a Property might be
suitable for the Company and for another investment entity which is advised or
managed by the Advisor, the Advisor shall give priority to the investment
entity, including the Company, which has uninvested funds for the longest period
of time. The Advisor may consider the Property for private placement only if
such Property is deemed inappropriate for any investment entity which is advised
or managed by the Advisor, including the Company.

      15. RELATIONSHIP OF ADVISOR AND COMPANY. The Company and the Advisor agree
that they have not created and do not intend to create by this Agreement a joint
venture or partnership relationship between them and nothing in this Agreement
shall be construed to make them partners or joint venturers or impose any
liability as partners or joint venturers on either of them.

      16. TERM; TERMINATION OF AGREEMENT. This Agreement shall continue in force
until December 10, 2005 and thereafter shall be automatically renewed from year
to year, unless either party shall give notice in writing of non-renewal to the
other party not less than 60 days before the end of any such year.

      17. TERMINATION BY COMPANY. At the sole option of a majority of the
Independent Directors, this Agreement may be terminated immediately by written
notice of termination from the Company to the Advisor upon the occurrence of
events which would constitute Cause or if any of the following events occur:

      (a) If the Advisor shall violate any material provision of this Agreement,
      and after written notice of such violation, shall not cure such default
      within 30 days or have begun action within 30 days to cure the default
      which shall be completed with reasonable diligence; or

      (b) If the Advisor shall be adjudged bankrupt or insolvent by a court of
      competent jurisdiction, or an order shall be made by a court of competent
      jurisdiction for the appointment of a receiver, liquidator, or trustee of
      the Advisor, for all or substantially all of its property by reason of the
      foregoing, or if a court of competent jurisdiction approves any petition
      filed against the Advisor for reorganization, and such adjudication or
      order shall remain in force or unstayed for a period of 30 days; or

      (c) If the Advisor shall institute proceedings for voluntary bankruptcy or
      shall file a petition seeking reorganization under the federal bankruptcy
      laws, or for

                                      -23-

<PAGE>

      relief under any law for relief of debtors, or shall consent to the
      appointment of a receiver for itself or for all or substantially all of
      its property, or shall make a general assignment for the benefit of its
      creditors, or shall admit in writing its inability to pay its debts,
      generally, as they become due.

      Any notice of termination under Section 16 or 17 shall be effective on the
date specified in such notice, which may be the day on which such notice is
given or any date thereafter. The Advisor agrees that if any of the events
specified in Section 17 (b) or (c) shall occur, it shall give written notice
thereof to the Directors within 15 days after the occurrence of such event.

      18. TERMINATION BY EITHER PARTY. This Agreement may be terminated
immediately without penalty (but subject to the requirements of Section 20
hereof) by the Advisor by written notice of termination to the Company upon the
occurrence of events which would constitute Good Reason or by the Company
without cause or penalty (but subject to the requirements of Section 20 hereof)
by action of the Directors, the Independent Directors or by action of a majority
of the Shareholders, in either case upon 60 days' written notice.

      19. ASSIGNMENT PROHIBITION. This Agreement may not be assigned by the
Advisor without the approval of a majority of the Directors (including a
majority of the Independent Directors); provided, however, that such approval
shall not be required in the case of an assignment to a corporation,
partnership, association, trust or organization which may take over the assets
and carry on the affairs of the Advisor, provided: (i) that at the time of such
assignment, such successor organization shall be owned substantially by the then
partners of the Advisor or their Affiliates and only if such entity has a net
worth of at least $5,000,000, and (ii) that a general partner of the Advisor
shall deliver to the Directors a statement in writing indicating the ownership
structure and net worth of the successor organization and a certification from
the new Advisor as to its net worth. Such an assignment shall bind the assignees
hereunder in the same manner as the Advisor is bound by this Agreement. The
Advisor may assign any rights to receive fees or other payments under this
Agreement without obtaining the approval of the Directors. This Agreement shall
not be assigned by the Company without the consent of the Advisor, except in the
case of an assignment by the Company to a corporation or other organization
which is a successor to the Company, in which case such successor organization
shall be bound hereunder and by the terms of said assignment in the same manner
as the Company is bound by this Agreement.

      20. PAYMENTS TO AND DUTIES OF ADVISOR UPON TERMINATION.

       (a) After the Termination Date, the Advisor shall not be entitled to
compensation for further services hereunder except it shall be entitled to
receive from the Company within 30 days after the effective date of such
termination the following:

            (i) all unpaid reimbursements of Organization and Offering Expenses
      and of Operating Expenses payable to the Advisor;

            (ii) all earned but unpaid Asset Management Fees and Performance
      Fees payable to the Advisor prior to the termination of this Agreement;

                                      -24-

<PAGE>

            (iii) all earned but unpaid Subordinated Acquisition Fees and all
      unaccrued Subordinated Acquisition Fees, in each case payable to the
      Advisor relating to the acquisition of any Property prior to the
      termination of this Agreement;

            (iv) all earned but unpaid Subordinated Disposition Fees payable to
      the Advisor relating to the sale of any Property prior to the termination
      of this Agreement;

            (v) all earned but unpaid Loan Refinancing Fees payable to the
      Advisor relating to the financing or refinancing of any Property prior to
      the termination of this Agreement; and

            (vi) all earned but unpaid Property Management Fees payable to the
      Advisor or its Affiliates relating to the management of any property prior
      to the termination of this Agreement.

      Notwithstanding the foregoing, in the event this Agreement is terminated
by the Company for Cause or by the Advisor for other than Good Reason, the
Advisor will not be entitled to receive the sums in subparagraphs 20(a)(i)-(vi),
above. All amounts payable to the Advisor in the event of a termination shall be
evidenced by a non-interest bearing promissory note (the "Note") having a
principal amount of the unpaid amount payable to the Advisor.

      (b) If this Agreement is terminated by the Company for any reason other
than Cause, by either party in connection with a Change of Control, or by the
Advisor for Good Reason, the Advisor shall be entitled to payment of the
Termination Fee.

      (c) The Termination Fee shall be paid in a manner determined by the
Directors, but in no event shall any portion of the Termination Fee remain
unpaid three years after the termination, non-renewal or substantial
modification of this Agreement, nor shall the Termination Fee be paid in less
than 12 equal quarterly installments, with interest, on the unpaid balance at
the prime rate of interest then in effect as announced by The Bank of New York.
Notwithstanding the preceding sentence, any amounts which may be deemed payable
at the date the obligation to pay the Termination Fee is incurred (i) shall be
an amount which provides compensation to the Advisor only for that portion of
the holding period for the respective Properties during which the Advisor
provided services to the Company, (ii) shall not be due and payable until the
Property to which such fees relate is sold or refinanced, and (iii) shall not
bear interest until the Property to which such fees relate is sold or
refinanced. A portion of the Termination Fee shall be paid as each Property
owned by the Company on the Termination Date is sold. The portion of the
Termination Fee payable upon each such sale shall be equal to (i) the
Termination Fee multiplied by (ii) the percentage calculated by dividing the
Appraised Value (at the Termination Date) of the Property sold by the Company
divided by the total Appraised Value (at the Termination Date) of all Properties
owned by the Company on the Termination Date.

      The Note for amounts payable as described above shall mature upon the
liquidation of the Company (or ten years from date of issuance whichever is
earlier) and shall be payable at any time prior to maturity. The compensation
payable under this Subsection shall be paid or

                                      -25-

<PAGE>

delivered to the Advisor within 30 days after funds shall become available to
the Company for the making of such payments.

      (d) Notwithstanding the foregoing, the Advisor shall not be entitled to
payment of the Termination Fee in the event this Agreement is terminated because
of failure of the Company and the Advisor to establish, pursuant to Section 9(j)
hereof, a fee structure appropriate for an entity with a perpetual life in the
event the Shares are listed on a national securities exchange or are included
for quotation on Nasdaq.

      (e) The Advisor shall promptly upon termination:

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

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

            (iii) deliver to the Directors all assets, including Properties and
      Loans, and documents of the Company then in the custody of the Advisor;
      and

            (iv) cooperate with the Company to provide an orderly management
      transition.

      21. INDEMNIFICATION BY THE COMPANY. The Company shall indemnify and hold
harmless the Advisor and its Affiliates, including their respective officers,
directors, partners and employees, from all liability, claims, damages or losses
arising in the performance of their duties hereunder, and related expenses,
including reasonable attorneys' fees, to the extent such liability, claims,
damages or losses and related expenses are not fully reimbursed by insurance,
subject to any limitations imposed by the laws of the State of Maryland, the
Articles of Incorporation or the Bylaws of the Company. Notwithstanding the
foregoing, the Advisor shall not be entitled to indemnification or be held
harmless pursuant to this Section 21 for any activity which the Advisor shall be
required to indemnify or hold harmless the Company pursuant to Section 22.

      22. INDEMNIFICATION BY ADVISOR. The Advisor shall indemnify and hold
harmless the Company from liability, claims, damages, taxes or losses and
related expenses including attorneys' fees, to the extent that such liability,
claims, damages, taxes or losses and related expenses are not fully reimbursed
by insurance and are incurred by reason of the Advisor's bad faith, fraud,
willful misfeasance, misconduct, negligence or reckless disregard of its duties.

      23. NOTICES. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report or other communication is accepted by the party to
whom it is given, and shall be given by being delivered by hand or by overnight
mail or other overnight delivery service to the addresses set forth herein:

                                      -26-

<PAGE>

            To the Directors      Corporate Property Associates 15
            and to the Company:   Incorporated
                                  50 Rockefeller Plaza
                                  New York, NY  10020

            To the Advisor:       Carey Asset Management Corp.
                                  50 Rockefeller Plaza
                                  New York, NY  10020

      Either party may at any time give notice in writing to the other party of
a change in its address for the purposes of this Section 23.

      24. MODIFICATION. This Agreement shall not be changed, modified,
terminated, or discharged, in whole or in part, except by an instrument in
writing signed by both parties hereto, or their respective successors or
assignees.

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

      26. CONSTRUCTION. This Agreement shall be governed by, construed and
enforced in accordance with the laws of the State of New York.

      27. ENTIRE AGREEMENT. This Agreement contains the entire agreement and
understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements, understandings,
inducements and conditions, express or implied, oral or written, of any nature
whatsoever with respect to the subject matter hereof. The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof. This Agreement may not be modified or
amended other than by an agreement in writing.

      28. INDULGENCES, NOT WAIVERS. Neither the failure nor any delay on the
part of a party to exercise any right, remedy, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, power or privilege preclude any other or further
exercise of the same or of any other right, remedy, power or privilege, nor
shall any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege
with respect to any other occurrence. No waiver shall be effective unless it is
in writing and is signed by the party asserted to have granted such waiver.

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

      30. TITLES NOT TO AFFECT INTERPRETATION. The titles of Sections and
subsections contained in this Agreement are for convenience only, and they
neither form a part of this Agreement nor are they to be used in the
construction or interpretation hereof.

                                      -27-

<PAGE>

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

      32. NAME. W. P. Carey & Co. LLC has a proprietary interest in the name
"Corporate Property Associates" and "CPA.(R)" Accordingly, and in recognition of
this right, if at any time the Company ceases to retain Carey Asset Management
Corp., or an Affiliate thereof to perform the services of Advisor, the Directors
of the Company will, promptly after receipt of written request from Carey Asset
Management Corp., cease to conduct business under or use the name "Corporate
Property Associates" or "CPA(R)" or any diminutive thereof and the Company shall
use its best efforts to change the name of the Company to a name that does not
contain the name "Corporate Property Associates" or "CPA(R)" or any other word
or words that might, in the sole discretion of the Advisor, be susceptible of
indication of some form of relationship between the Company and the Advisor or
any Affiliate thereof. Consistent with the foregoing, it is specifically
recognized that the Advisor or one or more of its Affiliates has in the past and
may in the future organize, sponsor or otherwise permit to exist other
investment vehicles (including vehicles for investment in real estate) and
financial and service organizations having "Corporate Property Associates" or
"CPA(R)" as a part of their name, all without the need for any consent (and
without the right to object thereto) by the Company or its Directors.

      33. INITIAL INVESTMENT. The Advisor has contributed to the Company
$200,000 in exchange for 20,000 Shares (the "Initial Investment"). The Advisor
or its Affiliates may not sell any of the Shares purchased with the Initial
Investment during the term of this Agreement. The restrictions included above
shall not continue to apply to any Shares other than the Share acquired through
the Initial Investment acquired by the Advisor or its Affiliates. The Advisor
shall not vote any Shares it now owns or hereafter acquires in any vote for the
election of Directors or any vote regarding the approval or termination of any
contract with the Advisor or any of its Affiliates.

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

                                       CORPORATE PROPERTY ASSOCIATES 15
                                       INCORPORATED

                                       By: /s/ John J. Park
                                          --------------------------------------
                                       Name:  John J. Park
                                       Title: Chief Financial Officer

                                       CAREY ASSET MANAGEMENT CORP.

                                       By:  /s/ John J. Park
                                          --------------------------------------
                                       Name:  John J. Park
                                       Title: Chief Financial Officer

                                      -28-

<PAGE>

                                                                       EXHIBIT A

                           RESTRICTED STOCK AGREEMENT

      This RESTRICTED STOCK AGREEMENT dated________ , by and between Corporate
Property Associates 15 Incorporated ("CPA(R):15"), a Maryland corporation and
Carey Asset Management Corp., a Delaware corporation and wholly-owned subsidiary
of W. P. Carey & Co. LLC (the "Advisor").

                                   WITNESSETH

      WHEREAS, CPA(R):15 and Advisor entered into an Advisory Agreement (the
"Advisory Agreement") pursuant to which Advisor provides various services to
CPA(R):15;

      WHEREAS, pursuant to the Advisory Agreement, CPA(R):15 is required to pay
certain fees to the Advisor and the Advisor may request that certain fees be
paid with common stock of the Company; and

      WHEREAS, the Advisor has requested that CPA(R):15 pay a portion of the
fees due to Advisor in the form of shares of common stock of CPA(R):15.

      NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows.

            1.    Payment of Fees with Stock. CPA(R):15 hereby grants to Advisor
________shares of common stock of CPA(R):15 (the "Shares").

            2.    Restrictions. The Shares are subject to vesting over a
five-year period. The Shares shall vest ratably over a five-year period with 20%
of the Shares paid in each payment vesting on each of the first through fifth
anniversary of the date hereof. Prior to the vesting of the ownership of the
Shares in the Advisor, the Shares may not be transferred by the Advisor.

            3.    Immediate Vesting. Upon the expiration of the Advisory
Agreement for any reason other than a termination for Cause under paragraph 17
of the Advisory Agreement or upon a "Change of Control" of CPA(R):15 (as defined
below), all Shares granted to the Advisor hereunder shall vest immediately and
all restrictions shall lapse. For purposes of this Agreement, a "Change of
Control" of the Company shall be deemed to have occurred if there has been a

<PAGE>

change in the ownership of the Company of a nature that would be required to be
reported in response to the disclosure requirements of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), as enacted and in force on the date hereof, whether or not
the Company is then subject to such reporting requirements; provided, however,
that, without limitation, a Change of Control shall be deemed to have occurred
if:

                  (i) any "person," as such term is used in Sections 13(d) and
14(d) of the Exchange Act (other than the Company, any of its subsidiaries, any
trustee, fiduciary or other person or entity holding securities under any
employee benefit plan of the Company or any of its subsidiaries), together with
all "affiliates" and "associates" (as such terms are defined in Rule 14b-2 under
the Exchange Act) of such person, shall become the "beneficial owner" (as such
term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
of securities of the Company representing 25% or more of either (A) the combined
voting power of the Company's then outstanding securities having the right to
vote in an election of the Company's Board of Directors ("Voting Securities") or
(B) the then outstanding common stock of the Company (in either such case other
than as a result of acquisition of securities directly from the Company);

                  (ii) persons who, as of the date hereof, constitute the
Company's Board of Directors (the "Incumbent Directors") cease for any reason,
including without limitation, as a result of a tender offer, proxy contest,
merger or similar transaction, to constitute at least a majority of the Board of
Directors, provided that any person becoming a director of the Company
subsequent to the date hereof whose election or nomination for election was
approved by a vote of at least a majority of the Incumbent Directors shall, for
purposes of this Agreement, be considered an Incumbent Director; or

                  (iii) the stockholders of the Company shall approve (A) any
consolidation or merger of the Company or any subsidiary where the stockholders
of the Company, immediately prior to the consolidation or merger, would not,
immediately after the consolidation or merger,

                                       -2-

<PAGE>

beneficially own (as such term is defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, shares representing in the aggregate 50% or more of the
voting equity of the entity issuing cash or securities in the consolidation or
merger (or of its ultimate parent entity, if any), (B) any sale, lease, exchange
or other transfer (in one transaction or a series of transactions contemplated
or arranged by any party as a single plan) of all or substantially all of the
assets of the Company or (C) any plan or proposal for the liquidation or
dissolution of the Company.

            Notwithstanding the foregoing, a "Change of Control" shall not be
deemed to have occurred for purposes of the foregoing clause (i) solely as the
result of an acquisition of securities by the Company which, by reducing the
number of Shares of Common Stock outstanding, increases (A) the proportionate
number of Shares beneficially owned by any person to 25% or more of the Shares
then outstanding, or (B) the proportionate voting power represented by the
Shares beneficially owned by any person to 25% or more of the combined voting
power of all then outstanding voting Securities; provided, however, that if any
person referred to in clause (A) or (B) of this sentence shall thereafter become
the beneficial owner of any additional Shares or other Voting Securities (other
than pursuant to a Share split, Share dividend, or similar transaction), then a
"Change of Control" shall be deemed to have occurred for purposes of the
foregoing clause (i).

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

                                CORPORATE PROPERTY ASSOCIATES 15
                                INCORPORATED

                                By:_____________________________________________

                                CAREY ASSET MANAGEMENT CORP.

                                By:_____________________________________________

                                       -3-<PAGE>

                                                                    Exhibit 10.5

                     AMENDED AND RESTATED ADVISORY AGREEMENT

      THIS AMENDED AND RESTATED ADVISORY AGREEMENT, dated as of February 17,
2005 is between CORPORATE PROPERTY ASSOCIATES 14 INCORPORATED, a Maryland
corporation (the "Company"), and CAREY ASSET MANAGEMENT CORP., a Delaware
corporation (the "Advisor") and amends the Amended and Restated Advisory
Agreement dated June 28, 2000 between the Company and the Advisor.

                              W I T N E S S E T H:

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

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

            NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows:

            1. DEFINITIONS. As used in this Agreement, the following terms have
the definitions hereinafter indicated:

            Acquisition Expenses. Those expenses, including but not limited to
      legal fees and expenses, travel and communications expenses, costs of
      appraisals, nonrefundable option payments on Property not acquired,
      accounting fees and expenses, title insurance and miscellaneous expenses,
      related to selection and acquisition of Properties, whether or not
      acquired. Acquisition Expenses shall not include Acquisition Fees.

            Acquisition Fees. The total of all fees and commissions (including
      any interest thereon) paid by any party to any party in connection with
      the making or investing in mortgage loans or the purchase, development or
      construction of Properties by the Company. A Development Fee or a
      Construction Fee paid to a Person not affiliated with the Sponsor in
      connection with the actual development or construction of a project after
      acquisition of the Property by the Company shall not be deemed an
      Acquisition Fee. Included in the computation of such fees or commissions
      shall be any real estate commission, selection fee, development fee (other
      than as described above), non-recurring management fee, mortgage placement
      fee, lease-up fee, transaction structuring fee or any fee of a similar
      nature, however designated. Acquisition Fees include Subordinated
      Acquisition Fees. Acquisition Fees shall not include Acquisition Expenses.

            Adjusted Investor Capital. As of any date, the Initial Investor
      Capital for such date reduced by any distributions on or prior to such
      date deemed by the Board to be

<PAGE>

      from Cash from Sales and Financings, but only to the extent such
      distributions exceed the amount necessary to satisfy any accrued but
      unpaid portion of the Preferred Return not satisfied by distributions of
      cash generated through operations through the date Cash from Sales or
      Financings are distributed by the Company.

            Advisor. Carey Asset Management Corp, a corporation organized under
      the laws of the State of Delaware.

            Affiliate. An Affiliate of another Person shall mean (i) any Person
      directly or indirectly owning, controlling, or holding, with power to vote
      ten percent or more of the outstanding voting securities of such other
      Person, (ii) any Person ten percent or more of whose outstanding voting
      securities are directly or indirectly owned, controlled, or held, with
      power to vote, by such other Person, (iii) any Person directly or
      indirectly controlling, controlled by, or under common control with such
      other Person, (iv) any executive officer, director, trustee or general
      partner of such other Person, or (iv) any legal entity for which such
      Person acts as an executive officer, director, trustee or general partner.

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

            Articles of Incorporation. Articles of Incorporation of the Company
      under the General Corporation Law of Maryland, as amended from time to
      time, pursuant to which the Company is organized.

            Asset Management Fee. The Asset Management Fee as defined in Section
      9(a) hereof.

            Average Invested Assets. Except as otherwise set forth in the
      penultimate sentence in Section 9(a) and (b) hereof, for a specified
      period, the average of the aggregate book value of the assets of the
      Company invested, directly or indirectly, in Properties and in Loans
      secured by real estate, before reserves for depreciation or bad debts or
      other similar non-cash reserves, computed by taking the average of such
      values at the end of each month during such period. For the purpose of
      calculating the Asset Management Fee and the Performance Fee, Average
      Invested Assets shall be calculated in accordance with Section 9(a) and
      9(b) hereof, respectively.

            Board or Board of Directors. The Board of Directors of the Company.

            Bylaws. The Bylaws of the Company.

            Cash from Financings. Net cash proceeds realized by the Company from
      the financing of Properties or the refinancing of any Company
      indebtedness.

                                      -2-
<PAGE>

            Cash from Sales. Net cash proceeds realized by the Company from the
      sale, exchange or other disposition of any of its assets after deduction
      of all expenses incurred in connection therewith. Cash from Sales shall
      not include Cash from Financings.

            Cash from Sales and Financings. The total sum of Cash from Sales and
      Cash from Financings.

            Cause. With respect to the termination of this Agreement, fraud,
      criminal conduct, willful misconduct or willful or negligent breach of
      fiduciary duty by the Advisor or a breach of this Agreement by the
      Advisor.

            Change of Control. A change of control of the Company of a nature
      that would be required to be reported in response to the disclosure
      requirements of Schedule 14A of Regulation 14A promulgated under the
      Securities Exchange Act of 1934, as amended (the "Exchange Act"), as
      enacted and in force on the date hereof, whether or not the Company is
      then subject to such reporting requirements; provided, however, that,
      without limitation, a Change of Control shall be deemed to have occurred
      if: (i) any "person" (within the meaning of Section 13(d) of the Exchange
      Act, as enacted and in force on the date hereof) is or becomes the
      "beneficial owner" (as that term is defined in Rule 13d-3, as enacted and
      in force on the date hereof, under the Exchange Act) of securities of the
      Company representing 8.5% or more of the combined voting power of the
      Company's securities then outstanding; (ii) there occurs a merger,
      consolidation or other reorganization of the Company which is not approved
      by the Board of Directors; (iii) there occurs a sale, exchange, transfer
      or other disposition of substantially all of the assets of the Company to
      another entity, which disposition is not approved by the Board of
      Directors; or (iv) there occurs a contested proxy solicitation of the
      Shareholders of the Company that results in the contesting party electing
      candidates to a majority of the Board of Directors' positions next up for
      election.

            Code. Internal Revenue Code of 1986, as amended.

            Company. Corporate Property Associates 14 Incorporated, a
      corporation organized under the laws of the State of Maryland.

            Competitive Real Estate Commission. The real estate or brokerage
      commission paid in a competitive market for the purchase or sale of a
      property that is reasonable, customary and competitive in light of the
      size, type and location of the property.

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

            Contract Purchase Price. The amount actually paid for or allocated
      (as of the date of purchase) to the purchase, development, construction or
      improvement of a Property, exclusive of Acquisition Fees and Acquisition
      Expenses.

                                       -3-
<PAGE>

            Contract Sales Price. The total consideration received by the
      Company for the sale of a Property.

            Cumulative Return. For the period for which the calculation is being
      made, the percentage resulting from dividing (A) the total Dividends paid
      on each Dividend payment date during such period (not including Dividends
      paid out of Cash from Sales and Financings), by (B) the product of (i) the
      average Adjusted Investor Capital for such period (calculated on a daily
      basis), and (ii) the number of years (including fractions thereof) elapsed
      during such period.

            Development Fee. A fee for the packaging of a Property including
      negotiating and approving plans, and undertaking to assist in obtaining
      zoning and necessary variances and necessary financing for the specific
      Property, either initially or at a later date.

            Directors. The persons holding such office, as of any particular
      time, under the Articles of Incorporation, whether they be the directors
      named therein or additional or successor directors.

            Dividends. Dividends declared by the Board.

            Equity Interest. The stock of or other interests in, or warrants or
      other rights to purchase the stock of or other interests in, any entity
      that has borrowed money from the Company or that is a tenant of the
      Company or that is a parent or controlling Person of any such borrower or
      tenant.

            Final Closing Date. The last date on which purchasers of Shares
      offered pursuant to the Prospectus were issued such Shares.

            Good Reason. With respect to the termination of this Agreement, (i)
      any failure to obtain a satisfactory agreement from any successor to the
      Company to assume and agree to perform the Company's obligations under
      this Agreement; or (ii) any material breach of this Agreement of any
      nature whatsoever by the Company.

            Gross Offering Proceeds. The aggregate purchase price of Shares sold
      pursuant to the Offering.

            Independent Appraiser. A qualified appraiser of real estate as
      determined by the Board, who is not affiliated, directly or indirectly,
      with the Company, the Advisor or their respective Affiliates. Membership
      in a nationally recognized appraisal society such as the American
      Institute of Real Estate Appraisers or the Society of Real Estate
      Appraisers shall be conclusive evidence of such qualification.

            Independent Director. A Director of the Company who is not
      associated and has not been associated within the last two years, directly
      or indirectly, with the Sponsor or the Advisor. A Director shall be deemed
      to be associated with the Sponsor or the

                                      -4-
<PAGE>

      Advisor if he or she (i) owns an interest in, is employed by, has any
      material business or professional relationship with, or is an officer or
      director of, the Sponsor, the Advisor, or any of their Affiliates, other
      than as a director or trustee or officer of not more than two other REITs
      organized by the Sponsor or advised by the Advisor, or (ii) performs
      services, other than as a Director, for the Company. An indirect
      relationship shall include circumstances in which a Director's spouse,
      parents, children, siblings, mothers- or fathers-in-law, sons- or
      daughters-in-law, or brothers- or sisters-in-law is or has been associated
      with the Sponsor, the Advisor, any of their Affiliates or the Company.

            Individual. Any natural person and those organizations treated as
      natural persons in Section 542(a) of the Code.

            Initial Closing Date. The first date on which purchasers of Shares
      offered pursuant to the Prospectus were issued such Shares.

            Initial Investor Capital. The total amount of capital invested from
      time to time by Shareholders (computed at a rate of $10 per Share for
      every Share including those Shares for which reduced selling commissions
      were paid in connection with their purchase from the Company). Upon
      completion of the Offering, the Initial Investor Capital shall be equal to
      the Gross Offering Proceeds.

            Loan Refinancing Fee. The Loan Refinancing Fee as defined in Section
      9(e) hereof.

            Loans. The notes and other evidences of indebtedness or obligations
      acquired or entered into by the Company as lender which are secured or
      collateralized by personal property, or fee or leasehold interests in real
      estate or other assets, including but not limited to first or subordinate
      mortgage loans, construction loans, development loans, loans secured by
      capital stock or any other assets or form of equity interest and any other
      type of loan or financial arrangement, such as providing or arranging for
      letters of credit, providing guarantees of obligations to third parties,
      or providing commitments for loans. The term "Loans" shall not include
      leases which are not recognized as leases for Federal income tax reporting
      purposes.

            Nasdaq. The national automated quotation system operated by the
      National Association of Securities Dealers, Inc.

            Net Income. For any period, the total revenues applicable to such
      period, less the total expenses applicable to such period excluding
      additions to reserves for depreciation, bad debts or other similar
      non-cash reserves; provided, however, Net Income for purposes of
      calculating total allowable Operating Expenses shall exclude the gain from
      the sale of the Company's assets.

            Offering. The offering of Shares pursuant to the Prospectus.

                                      -5-
<PAGE>

            Operating Expenses. All operating, general and administrative
      expenses paid or incurred by the Company, as determined under generally
      accepted accounting principles, except the following: (i) interest and
      discounts and other cost of borrowed money; (ii) taxes (including state
      and Federal income tax, property taxes and assessments, franchise taxes
      and taxes of any other nature); (iii) expenses of raising capital,
      including Organization and Offering Expenses, printing, engraving, and
      other expenses, and taxes incurred in connection with the issuance,
      distribution, transfer, registration and stock exchange listing of the
      Company's Shares and Securities; (iv) expenses connected with the
      acquisition, disposition, ownership and operation of real estate
      interests, mortgage loans, or other property, including the costs of
      foreclosure, insurance premiums, legal services, brokerage and sales
      commissions, maintenance, repair and improvement of property; (v) the
      Acquisition Fee or Subordinated Disposition Fee payable to the Advisor or
      any other party; and (vi) non-cash items, such as depreciation,
      amortization, depletion, and additions to reserves for depreciation,
      amortization, depletion, losses and bad debts. Notwithstanding anything
      herein to the contrary, Operating Expenses shall include the Asset
      Management Fee, the Performance Fee and the Loan Refinancing Fee.

            Organization and Offering Expenses. Those expenses payable by the
      Company in connection with the formation, qualification and registration
      of the Company and in marketing and distributing Shares, including, but
      not limited to, (i) the preparing, printing, filing and delivery of the
      Registration Statement and the Prospectus (including any amendments
      thereof or supplements thereto) and the preparing and printing of
      contractual agreements between the Company and the Sales Agent and the
      Selected Dealers (including copies thereof), (ii) the preparing and
      printing of the Articles of Incorporation and Bylaws, solicitation
      material and related documents and the filing and/or recording of such
      documents necessary to comply with the laws of the State of Maryland for
      the formation of a corporation and thereafter for the continued good
      standing of a corporation, (iii) the qualification or registration of the
      Shares under state securities or "Blue Sky" laws, (iv) any escrow
      arrangements, including any compensation to an escrow agent, (v) the
      filing fees payable to the SEC and to the National Association of
      Securities Dealers, Inc., (vi) reimbursement for the reasonable and
      identifiable out-of-pocket expenses of the Sales Agent and the Selected
      Dealers, including the cost of their counsel, (vii) the fees of the
      Company's counsel and independent public accountants, (viii) all
      advertising expenses incurred in connection with the Offering, including
      the cost of all sales literature and the costs related to investor and
      broker-dealer sales and information meetings and marketing incentive
      programs, and (ix) selling commissions, marketing fees, incentive fees and
      wholesaling fees and expenses incurred in connection with the sale of the
      Shares.

            Performance Fee. The Performance Fee as defined in Section 9(b).

            Person. An Individual, corporation, partnership, joint venture,
      association, company, trust, bank, or other entity, or government or any
      agency or political subdivision of a government.

                                      -6-
<PAGE>

            Preferred Return. A Cumulative Return of 6% computed from the
      Initial Closing Date through the date as of which such amount is being
      calculated.

            Property or Properties. The Company's partial or entire interest in
      real property (including leasehold interests) and personal or mixed
      property connected therewith.

            Property Management Fee. The Property Management Fee as defined in
      Section 9(f) hereof.

            Prospectus. The final prospectus of the Company pursuant to which
      the Company offered up to 30,000,000 Shares, as the same from time to time
      may have been amended or supplemented after the effective date of the
      Registration Statement.

            Registration Statement. The Registration Statement on Form S-11 of
      which the Prospectus is a part.

            REIT. A real estate investment trust, as defined in Sections 856-860
      of the Code.

            Sales Agent. Carey Financial Corporation.

            Securities. Any stock, shares (other than currently outstanding
      Shares and subsequently issued shares of common stock of the Company),
      voting trust certificates, bonds, debentures, notes or other evidences of
      indebtedness, secured or unsecured, convertible, subordinated or otherwise
      or in general any instruments commonly known as "securities" or any
      certificate of interest, shares or participation in temporary or interim
      certificates for receipts (or, guarantees of, or warrants, options or
      rights to subscribe to, purchase or acquire any of the foregoing), which
      subsequently may be issued by the Company.

            Selected Dealer Fee. A due diligence and management fee payable to
      Selected Dealers by the Company (through the Sales Agent) of up to 1% of
      the price of each Share sold by those Selected Dealers to which the Sales
      Agent agrees to pay such due diligence and management fee.

            Selected Dealers. Broker-dealers who are members of the National
      Association of Securities Dealers, Inc. and who have executed an agreement
      with the Sales Agent in which the Selected Dealers agree to participate
      with the Sales Agent in the Offering.

            Shareholders. Those Persons who at any particular time are shown as
      holders of record of Shares on the books and records of the Company.

            Shares. All of the shares of common stock of the Company, $.001 par
      value, and all other shares of common stock of the Company issued in the
      Offering or any subsequent offering.

                                      -7-
<PAGE>

            Sponsor. W. P. Carey & Co. LLC and any other person directly or
      indirectly instrumental in organizing, wholly or in part, the Company or
      any person who will manage or participate in the management of the
      Company, and any Affiliate of any such person. Sponsor does not include a
      person whose only relationship to the Company is that of an independent
      property manager and whose only compensation is as such. Sponsor also does
      not include wholly independent third parties such as attorneys,
      accountants and underwriters whose only compensation is for professional
      services.

            Subordinated Acquisition Fee. The Subordinated Acquisition Fee as
      defined in Section 9(d).

            Subordinated Disposition Fee. The Subordinated Disposition Fee as
      defined in Section 9(g) hereof.

            Subordinated Incentive Fee. The Subordinated Incentive Fee as
      defined in Section 9(h) hereof.

            Termination Date. The effective date of any termination of this
      Agreement.

            Termination Fee. An amount equal to 15% of the amount, if any, by
      which (1) the Appraised Value of the Properties on the Termination Date,
      less the amount of all indebtedness secured by such Properties, exceeds
      (2) the total of the Initial Investor Capital on the Final Closing Date
      plus an amount equal to the Preferred Return through the Termination Date
      reduced by the total Dividends paid by the Company from its inception
      through the Termination Date.

            Total Property Cost. With regard to any Property, an amount equal to
      the sum of the Contract Purchase Price of such Property plus the
      Acquisition Fees paid in connection with such Property.

            2%/25% Guidelines. The requirement that, in any 12-month period, the
      Operating Expenses not exceed the greater of 2% of the Company's Average
      Invested Assets during such 12-month period or 25% of the Company's Net
      Income over the same 12-month period.

            Underlying Real Property. Property serving as collateral for any
      Loan.

            Valuation. An estimate of value of the assets of the Company as
      determined by a Person approved by the Independent Directors, which Person
      shall be independent of the Company and the Advisor.

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

                                      -8-
<PAGE>

            3. DUTIES OF THE ADVISOR. The Advisor undertakes to use its best
efforts to present to the Company potential investment opportunities and to
provide a continuing and suitable investment program consistent with the
investment objectives and policies of the Company as determined and adopted from
time to time by the Directors. In performance of this undertaking, subject to
the supervision of the Directors and consistent with the provisions of the
Registration Statement, Articles of Incorporation and Bylaws of the Company, the
Advisor shall, either directly or by engaging an Affiliate:

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

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

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

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

                  (e) subject to the provisions of Sections 3(g) and 4 hereof,
            (i) locate, analyze and select potential investments in Property and
            Loans; (ii) structure and negotiate the terms and conditions of
            transactions pursuant to which investments in Properties and Loans
            will be made, purchased or acquired by the Company; (iii) make
            investments in Property on behalf of the Company in compliance with
            the investment objectives and

                                      -9-
<PAGE>

            policies of the Company; (iv) arrange for financing, and refinancing
            and make other changes in the asset or capital structure of, and
            dispose of, reinvest the proceeds from the sale of or otherwise deal
            with the investments in Property and Loans; and (v) enter into
            leases and service contracts for Properties and, to the extent
            necessary, perform all other operational functions for the
            maintenance and administration of such Properties;

                  (f) provide the Directors with periodic reports regarding
            prospective investments in Properties and Loans;

                  (g) obtain the prior approval of the Directors (including a
            majority of the Independent Directors) for any and all investments
            in Property which do not meet all of the requirements set forth in
            Section 4(b) hereof and obtain the prior approval of the Independent
            Directors for all investments in Loans;

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

                  (i) obtain reports (which may be prepared by the Advisor or
            its Affiliates), where appropriate, concerning the value of
            investments or contemplated investments of the Company in Property
            and/or Loans;

                  (j) obtain for, or provide to, the Company such services as
            may be required in acquiring, managing and disposing of Company
            Property and/or Loans, including, but not limited to; (i) the
            negotiation, making and servicing of Loans; (ii) the disbursement
            and collection of Company monies; (iii) the payment of debts of and
            fulfillment of the obligations of the Company; and (iv) the
            handling, prosecuting and settling of any claims of or against the
            Company, including, but not limited to, foreclosing and otherwise
            enforcing mortgages and other liens securing the Loans;

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

                                      -10-
<PAGE>

                  (l) communicate on behalf of the Company with Shareholders as
            required to satisfy the reporting and other requirements of any
            governmental bodies or agencies to Shareholders and third parties
            and otherwise as requested by the Company;

                  (m) provide or arrange for administrative services and items,
            legal and other services, office space, office furnishings,
            personnel and other overhead items necessary and incidental to the
            Company's business and operations;

                  (n) provide the Company with such accounting data and any
            other information so requested concerning the investment activities
            of the Company as shall be required to prepare and to file all
            periodic financial reports and returns required to be filed with the
            Securities and Exchange Commission and any other regulatory agency,
            including annual financial statements;

                  (o) maintain the books and records of the Company;

                  (p) supervise the performance of such ministerial and
            administrative functions as may be necessary in connection with the
            daily operations of the Properties and Loans;

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

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

                  (s) perform such other services as may be required from time
            to time for management and other activities relating to the assets
            of the Company as the Advisor shall deem advisable under the
            particular circumstances;

                  (t) deliver to or maintain on behalf of the Company copies of
            all appraisals obtained in connection with investments in Properties
            and Loans; and

                  (u) notify the Board of all proposed transactions before they
            are completed.

            Advisor will provide those services described in subparagraphs (e),
(f), (g), (h), (j), (t) and (u) to the extent that such services are not
provided by W. P. Carey & Co. LLC

                                      -11-
<PAGE>

pursuant to that certain Acquisition Services Agreement dated the date hereof,
as such Agreement may be extended or amended from time to time.

            4. AUTHORITY OF ADVISOR.

            (a) Pursuant to the terms of this Agreement (including the
restrictions included in this Section 4 and in Section 7 hereof), and subject to
the continuing and exclusive authority of the Directors over the management of
the Company, the Directors hereby delegate to the Advisor the authority to (1)
locate, analyze and select investment opportunities, (2) structure the terms and
conditions of transactions pursuant to which investments will be made or
acquired for the Company, (3) acquire Property and make Loans in compliance with
the investment objectives and policies of the Company, (4) arrange for financing
or refinancing, or make changes in the asset or capital structure of, and
dispose of or otherwise deal with, Property and Loans, (5) enter into leases and
service contracts for Properties, and perform other property level operations,
(6) oversee non-affiliated property managers and other non-affiliated Persons
who perform services for the Company, and (7) undertake accounting and other
record-keeping functions at the Property level.

            (b) Notwithstanding the foregoing, any investment in Property,
including any acquisition of any Property by the Company (as well as any
financing acquired by the Company in connection with such acquisition), will
require the prior approval of the Directors unless, prior to completion of any
such transaction, the Advisor provides the Company with:

                  (i) an appraisal for the Property indicating that the Total
            Property Cost of the Property does not exceed the Appraised Value of
            the Property; and

                  (ii) a representation from the Advisor that the Property, in
            conjunction with the Company's other investments and proposed
            investments, at the time the Company is committed to purchase the
            Property, is reasonably expected to fulfill the Company's investment
            objectives and policies as established by the Directors and then in
            effect.

            (c) If a transaction requires approval by the Independent Directors,
the Advisor will deliver to the Independent Directors all documents required by
them to properly evaluate the proposed investment in such Property or such Loan.

            Notwithstanding the foregoing, the prior approval of the Directors,
including a majority of the Independent Directors, will be required for
transactions involving (a) investments in Properties in respect of which all of
the requirements specified in Section 4(b) hereof have not be satisfied, (b)
investments in Properties made through joint venture arrangements with
Affiliates of the Advisor, (c) investments in Properties which are not
contemplated by the terms of the Prospectus, (d) transactions that present
issues which involve conflicts of interest for the Advisor (other than conflicts
involving the payment of fees or the reimbursement of expenses),

                                      -12-
<PAGE>

(e) investments in equity securities, and (f) the lease of assets to the
Sponsor, any Director or the Advisor.

            The Directors may, at any time upon the giving of notice to the
Advisor, modify or revoke the authority set forth in this Section 4. If and to
the extent the Directors so modify or revoke the authority contained herein, the
Advisor shall henceforth submit to the Directors for prior approval such
proposed transactions involving investments in Property as thereafter require
prior approval, provided however, that such modification or revocation shall be
effective upon receipt by the Advisor and shall not be applicable to investment
transactions to which the Advisor has committed the Company prior to the date of
receipt by the Advisor of such notification.

            5. BANK ACCOUNTS. The Advisor may establish and maintain one or more
bank accounts in its own name for the account of the Company or in the name of
the Company and may collect and deposit into any such account or accounts, and
disburse from any such account or accounts, any money on behalf of the Company,
provided that no funds shall be commingled with the funds of the Advisor; and
the Advisor shall from time to time render appropriate accountings of such
collections and payments to the Directors and to the auditors of the Company.

            6. RECORDS; ACCESS. The Advisor shall maintain appropriate records
of all its activities hereunder and make such records available for inspection
by the Directors and by counsel, auditors and authorized agents of the Company,
at any time or from time to time during normal business hours. The Advisor shall
at all reasonable times have access to the books and records of the Company.

            7. LIMITATIONS ON ACTIVITIES. Anything else in this Agreement to the
contrary notwithstanding, the Advisor shall refrain from taking any action
which, in its sole judgment made in good faith, would adversely affect the
status of the Company as a REIT, subject the Company to regulation under the
Investment Company Act of 1940, would violate any law, rule, regulation or
statement of policy of any governmental body or agency having jurisdiction over
the Company, its Shares or its Securities, or otherwise not be permitted by the
Articles of Incorporation or Bylaws, except if such action shall be ordered by
the Directors, in which case the Advisor shall notify promptly the Directors of
the Advisor's judgment of the potential impact of such action and shall refrain
from taking such action until it receives further clarification or instructions
from the Directors. In such event the Advisor shall have no liability for acting
in accordance with the specific instructions of the Directors so given.
Notwithstanding the foregoing, the Advisor, its partners and employees, and
partners, stockholders, directors and officers of the Advisor's partners shall
not be liable to the Company, or to the Directors or Shareholders for any act or
omission by the Advisor, its partners or employees, or partners, stockholders,
directors or officers of the Advisor's partners except as provided in Sections
20 and 22 hereof.

            8. RELATIONSHIP WITH DIRECTORS. Partners and employees of the
Advisor or partners in the Advisor or any corporate parents of a partner, or
directors, officers or stockholders of any partner or corporate parent of a
partner may serve as a Director and as

                                      -13-
<PAGE>

officers of the Company, except that no partner in or employee of the Advisor or
its Affiliates who also is a Director or officer of the Company shall receive
any compensation from the Company for serving as a Director or officer other
than for reasonable reimbursement for travel and related expenses incurred in
attending meetings of the Directors.

            9. FEES.

            (a) ASSET MANAGEMENT FEE. The Company shall pay to the Advisor as
compensation for the advisory services rendered to the Company hereunder an
amount equal to .5% per annum of the Average Invested Assets of the Company (the
"Asset Management Fee") calculated as set forth below. The Asset Management Fee
will be calculated monthly, beginning with the month in which the Company first
makes an investment in Properties or Loans, on the basis of one-twelfth of .5%
of the Average Invested Assets during the previous month, computed as a daily
average. The Asset Management Fee calculated with respect to each month shall be
payable monthly on the last day of such month, or the first business day
following the last day of such month. If at the end of any fiscal quarter, the
Company's Operating Expenses exceed the 2%/25% Guidelines over the immediately
preceding 12 months, payment of the Asset Management Fee will be withheld to the
extent necessary to cause the Company to satisfy the 2%/25% Guidelines. Any
portion of the Asset Management Fee not paid due to the Company's failure to
satisfy the 2%/25% Guidelines shall be paid at the end of the next fiscal
quarter to the extent such payment would not cause the Company to fail to
satisfy the 2%/25% Guidelines if such payment were to be included in the
Company's Operating Expenses for the 12 months preceding such payment. For
purposes of determining the amount of the Asset Management Fee, the Average
Invested Assets will be, in any particular month, the estimated value of all of
the Properties determined in accordance with the most recently conducted
Valuation, plus the principal balance of all Loans. Any part of the Asset
Management Fee that has been subordinated pursuant to this subsection (a) shall
not be deemed earned until such time as payable hereunder.

            (b) PERFORMANCE FEE. In addition to the Asset Management Fee
described in Section 9(a) above, the Company shall also pay to the Advisor as
compensation for the advisory services rendered to the Company hereunder an
amount equal to .5% per annum of the Average Invested Assets of the Company (the
"Performance Fee") calculated as set forth below. The Performance Fee will be
calculated monthly, beginning with the month in which the Company first makes an
investment in Properties or Loans, on the basis of one-twelfth of .5% of the
Average Invested Assets during the previous month, computed as a daily average.
The Performance Fee calculated with respect to each month shall be payable on a
quarterly basis on the last day of the first month of the immediately following
fiscal quarter, but only if the Company has generated Cash Flow from Operations
in the aggregate of no less than 7% of Gross Offering Proceeds for the period
beginning with the Initial Closing Date and ending on the last day of the most
recently completed fiscal quarter. Any portion of the Performance Fee not paid
due to the Company's failure to pay the Preferred Return shall be paid by the
Company, to the extent it is not restricted by the 2%/25% Guidelines as
described below, at the end of the next fiscal quarter through which the Company
has paid the Preferred Return. If at the end of any fiscal quarter, the
Company's Operating Expenses exceed the 2%/25% Guidelines over the immediately
preceding 12 months, payment of the Performance Fee will be withheld to the

                                      -14-
<PAGE>

extent necessary to cause the Company to satisfy the 2%/25% Guidelines. Any
portion of the Performance Fee not paid due to the Company's failure to satisfy
the 2%/25% Guidelines shall be paid at the end of the next fiscal quarter to the
extent such payment would not cause the Company to fail to satisfy the 2%/25%
Guidelines if such payment were to be included in the Company's Operating
Expenses for the 12 months preceding such payment. For purposes of determining
the amount of the Performance Fee, the Average Invested Assets will be, in any
particular month, the estimated value of all of the Company's Properties
determined in accordance with the most recently conducted Valuation, plus the
principal balance of all Loans. Any part of the Performance Fee that has been
subordinated pursuant to this subsection (b) shall not be deemed earned until
such time as payable hereunder.

            (c) ACQUISITION FEE. The Advisor may receive as compensation for
services rendered in connection with the investigation, selection and
acquisition (by purchase, investment or exchange) of Property an Acquisition Fee
payable by the seller of such Property or the Company. The total Acquisition
Fees (not including Subordinated Acquisition Fees) payable to the Advisor and
its Affiliates plus Acquisition Fees (not including Subordinated Acquisition
Fees) payable by the Company to any other party may not exceed 2.5% of the
aggregate Total Property Cost of all Properties purchased by the Company with
proceeds from the Offering (calculated after all such proceeds are invested)
unless a majority of the Directors (including a majority of the Independent
Directors) not otherwise interested in any transaction approve the excess as
being commercially competitive, fair and reasonable to the Company. The total
amount of Acquisition Fees (including Subordinated Acquisition Fees and any
interest thereon) and Acquisition Expenses paid by the Company may not exceed
six percent (6%) of the aggregate Contract Purchase Price of all Properties
purchased by the Company unless a majority of the Board (including a majority of
the Independent Directors) not otherwise interested in any transaction approves
fees in excess of this limit as being commercially competitive, fair and
reasonable to the Company. No Acquisition Fees will be payable on the
reinvestment of proceeds from the sale or refinancing of Properties.

            (d) SUBORDINATED ACQUISITION FEE. In addition to the Acquisition Fee
described in Section 9(c) above, the Advisor may receive as additional
compensation for services rendered in connection with the investigation,
selection and acquisition (by purchase, investment or exchange) of a Property a
Subordinated Acquisition Fee payable by the seller of such Property or the
Company. The total Subordinated Acquisition Fees payable to the Advisor and its
Affiliates plus Subordinated Acquisition Fees payable by the Company to any
other party may not exceed 2.0% of the aggregate Total Property Cost of all
Properties purchased by the Company with proceeds from the Offering (calculated
after all such proceeds are invested) unless a majority of the Directors
(including a majority of the Independent Directors) not otherwise interested in
any transaction approve the excess as being commercially competitive, fair and
reasonable to the Company. The unpaid portion of the Subordinated Acquisition
Fee with respect to any Property shall bear interest at the rate of 6% per annum
from the date of acquisition of such Property until such portion is paid.
Subject to the following sentence, the Subordinated Acquisition Fee with respect
to any Property shall be payable in equal annual installments on January 1 of
each of the eight calendar years following the first anniversary of the date
such Property was purchased. Accrued interest shall also be payable on such
dates. The portion of the Subordinated Acquisitions Fees, and accrued interest
thereon, otherwise payable for any year on January 1 of

                                      -15-
<PAGE>

the following year shall be payable only if the Company has paid Dividends to
Shareholders in an amount sufficient to pay the Preferred Return for the period
beginning with the Initial Closing Date and ending on the last day of such year.
Any portion of the Subordinated Acquisitions Fees, and accrued interest thereon,
not paid due to the Company's failure to pay the Preferred Return for the most
recently completed fiscal year shall be paid by the Company on January 1
following the fiscal year through which the Company has paid the Preferred
Return. In the event that the Shares are listed for trading on a national
securities exchange or are included for quotation on NASDAQ, all Subordinated
Acquisition Fees, and accrued interest thereon, shall be due and payable on the
date of such listing or inclusion. No Subordinated Acquisition Fees will be
payable on the reinvestment of proceeds from the sale or refinancing of
Properties.

            (e) LOAN REFINANCING FEE. The Company shall pay to the Advisor for
all qualifying loan refinancings of Properties a Loan Refinancing Fee in the
amount of 1% of the principal amount of any loan secured by a Property. Any Loan
Refinancing Fee shall be due and payable upon the funding of the related
mortgage loan or as soon thereafter as is reasonably practicable. A refinancing
will qualify for a Loan Refinancing Fee only if (i) any new loan is approved by
the Independent Directors as being in the best interests of the Company, (ii)
payment of the fee is approved by a majority of the Independent Directors, and
(iii) the terms of the new loan represent an improvement over the terms of the
refinanced loan, the new loan materially increases the total debt secured by a
particular Property or the maturity date of the refinanced loan (which must have
a term of five years or more) is less than one year from the date of the
refinancing.

            (f) PROPERTY MANAGEMENT FEE. The Advisor may cause the Company to
pay Property Management Fees for property management services rendered by the
Advisor or its Affiliates in connection with Properties acquired directly or
through foreclosure. The Advisor or an Affiliate will provide property
management services only if a Property becomes vacant or requires more active
management than contemplated at the time such Property is acquired. In either
event, the Company, by approval of the Directors (including a majority of the
Independent Directors), may engage the Advisor or an Affiliate, subject to such
Advisor's or such Affiliate's qualifying as an "independent contractor" pursuant
to Section 856(d)(3) of the Code, to provide property management services. If
such services are rendered by the Advisor or an Affiliate, the maximum Property
Management Fees which may be paid to the Advisor or an Affiliate will be 6% of
gross revenues from commercial Properties and 5% of gross revenues from
residential Properties, plus reimbursed expenses, paid monthly, where such
entity performs property management and leasing, re-leasing and leasing related
services, or 3% of the gross revenues of the Property if only property
management services are performed by such entity. Property Management Fees
payable to the Advisor or an Affiliate for an industrial or commercial Property
leased on a long-term (defined as at least ten years, excluding renewals) triple
net basis, may not exceed 1% of the gross revenues from such Property, except
for a one-time initial leasing fee equal to 3% of total base rents payable for
the first five years of the lease, payable in five equal annual installments.
Such fees to the Advisor or its Affiliate cannot exceed the usual and customary
amounts charged for similar services in the same geographic area.

            (g) SUBORDINATED DISPOSITION FEE. If the Advisor or an Affiliate
provides a substantial amount of the services (as determined by a majority of
the Independent Directors) in

                                      -16-
<PAGE>

the sale of a Property, the Advisor or an Affiliate shall receive a Subordinated
Disposition Fee equal to the lesser of (i) 50% of the Competitive Real Estate
Commission and (ii) 3% of the Contract Sales Price of such Property. The
Subordinated Disposition Fee will be paid only if Shareholders have received
total Dividends in an amount equal to 100% of Initial Investor Capital plus an
amount sufficient to pay a Cumulative Return of 6% from the Initial Closing Date
through the date payment is made. To the extent that Subordinated Disposition
Fees are not paid by the Company on a current basis due to the foregoing
limitation, the unpaid fees will be accrued and paid at such time as the
limitation has been satisfied. The Subordinated Disposition Fee may be paid in
addition to real estate commissions paid to non-Affiliates, provided that the
total real estate commissions paid to all Persons by the Company shall not
exceed an amount equal to the lesser of (i) 6% of the Contract Sales Price of a
Property or (ii) the Competitive Real Estate Commission. In the event this
Agreement is terminated prior to such time as the Shareholders have received
total Dividends in an amount equal to 100% of Initial Investor Capital plus an
amount sufficient to pay a Cumulative Return of 6% from the Initial Closing Date
through the date of termination of this Agreement, an appraisal of the
Properties then owned by the Company shall be made and the Subordinated
Disposition Fee on Properties previously sold will be deemed earned if the
Appraised Value of the Properties then owned by the Company plus total Dividends
received prior to the date of termination of this Agreement is equal to 100% of
Initial Investor Capital plus an amount sufficient to pay a Cumulative Return of
6% from the Initial Closing Date through the date of termination of this
Agreement. In the event the Company's Shares are listed on a national securities
exchange or included for quotation on NASDAQ and, at the time of such listing,
the Advisor has accrued a Subordinated Disposition Fee which has not been paid,
for purposes of determining whether the subordination conditions have been
satisfied, Shareholders will be deemed to have received a Dividend in an amount
equal to the product of the total number of outstanding Shares and the average
of the closing prices (or average bid and asked quotes) of the Shares over a
period, beginning 180 days after listing of the Shares, of 30 days during which
the Shares are traded.

            (h) SUBORDINATED INCENTIVE FEE. The Subordinated Incentive Fee shall
be payable to the Advisor in an amount equal to 15% of Cash from Sales and
Financings distributed to the Shareholders after the Shareholders have received
total Dividends in an amount equal to 100% of Initial Investor Capital plus an
amount sufficient to pay the Preferred Return from the Initial Closing Date
through the date on which each distribution out of Cash From Sales and
Financings is made. In the event the Shares are listed on a national securities
exchange or included for quotation on NASDAQ, the Advisor shall be paid the
Subordinated Incentive Fee in an amount equal to 12% of the excess (the "Excess
Return") of (A) the sum (the "Hypothetical Return") of (i) the market value of
the Company, measured by taking the average closing price or bid and asked
price, as the case may be, over a period, beginning 180 days after listing of
the Shares, of 30 days during which the Shares are traded (the "Market Value")
plus (ii) the total of the Dividends paid to Shareholders from the Initial
Closing Date until the date the Shares are listed or included for quotation over
(B) the sum of (i) 100% of Initial Investor Capital and (ii) the total amount of
the Dividends required to be paid to Shareholders in order to pay the Preferred
Return through the date the Market Value is determined. The Subordinated
Incentive Fee shall be increased to 13% of the Excess Return if the Hypothetical
Return is an amount sufficient to return to investors 100% of Initial Investor
Capital plus a cumulative return of 8% or more but less than 9%; 14% if the
Hypothetical Return is an amount sufficient to return 100% of

                                      -17-
<PAGE>

Initial Investor Capital plus a cumulative return of 9% or more but less than
10%; and 15% if the Hypothetical Return is an amount sufficient to return 100%
of Initial Investor Capital plus a cumulative return of 10% or more. The
Cumulative return shall be measured from the Initial Closing Date through the
last day on which the Market Value is determined. The fee may only be paid if
the average closing price of the Shares over any consecutive three-month period
ending within 24 months of the date of listing is sufficient, when added to
Dividends previously paid from the Initial Closing Date through the end of such
three-month period, to return 100% of Initial Investor Capital plus a 6%
cumulative return from the Initial Closing Date through the last day of such
three-month period. The Company shall have the option to pay such fee in the
form of cash, a promissory note or any combination thereof. The promissory note
shall be fully amortizing over five years, provide for quarterly payments and
bear interest at the prime rate published from time to time in The Wall Street
Journal.

            (i) LOANS FROM AFFILIATES. If any loans are made to the Company by
the Advisor or an Affiliate of the Advisor, the maximum amount of interest that
may be charged by such Affiliate shall be the lesser of (i) 1% above the prime
rate of interest published from time to time in The Wall Street Journal and (ii)
the rate that would be charged to the Company by unrelated lending institutions
on comparable loans for the same purpose in the locality of the Property. The
terms of any such loans shall be no less favorable than the terms available
between non-Affiliated Persons for similar commercial loans.

            (j) CHANGES TO FEE STRUCTURE. In the event the Shares are listed on
a national securities exchange or are included for quotation on Nasdaq, the
Company and the Advisor shall negotiate in good faith to establish a fee
structure appropriate for a entity with a perpetual life. A majority of the
Independent Directors must approve the new fee structure negotiated with the
Advisor. In negotiating a new fee structure, the Independent Directors shall
consider all of the factors they deem relevant, including but not limited to:
(a) the size of the advisory fee in relation to the size, composition and
profitability of the Company's portfolio; (b) the success of the Advisor in
generating opportunities that meet the investment objectives of the Company; (c)
the rates charged to other REITs and to investors other than REITs by Advisors
performing similar services; (d) additional revenues realized by the Advisor and
its Affiliates through their relationship with the Company, including loan
administration, underwriting or broker commissions, servicing, engineering,
inspection and other fees, whether paid by the Company or by others with whom
the Company does business; (e) the quality and extent of service and advice
furnished by the Advisor; (f) the performance of the investment portfolio of the
Company, including income, conversion or appreciation of capital, frequency of
problem investments and competence in dealing with distress situations; and (g)
the quality of the portfolio of the Company in relationship to the investments
generated by the Advisor for its own account. The new fee structure can be no
more favorable to the Advisor than the current fee structure.

            (k) PAYMENT. Compensation payable to the Advisor pursuant to this
Section 9 shall be paid in cash; provided, however, that any fee payable
pursuant to Section 9 may be paid, at the option of the Advisor, in the form of
(i) cash, (ii) common stock of the Company or (iii) a combination of cash and
common stock. The Advisor shall notify the Company in writing of the form in
which the fee shall be paid. Such notice shall be provided no later than January
15

                                      -18-
<PAGE>

of each year. If no such notice is provided, the fee shall be paid in cash. For
purposes of the payment of compensation to the Advisor in the form of stock, the
value of each share of common stock shall be the Net Asset Value per Share
determined in accordance with the appraisal of the Company's assets performed as
of the end of the immediately preceding year by an Independent Appraiser. The
Net Asset Value determined on the basis of such appraisal may be adjusted on a
quarterly basis by the Board of Directors of the Company to account for
significant capital transactions. Fees paid in the form of stock shall be paid
pursuant to the terms of the form of the Restricted Stock Agreement attached
hereto as Exhibit A or such other terms as the Advisor and the Company may from
time to time agree.

            10. EXPENSES. In addition to the compensation paid to the Advisor
pursuant to Section 9 hereof, the Company shall pay directly or reimburse the
Advisor for the following expenses:

                  (i) Acquisition Expenses incurred in connection with the
            initial investment of the funds of the Company;

                  (ii) expenses other than Acquisition Expenses incurred in
            connection with the investment of the funds of the Company;

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

                  (iv) taxes and assessments on income or Property and taxes as
            an expense of doing business;

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

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

                  (vii) fees and expenses of legal counsel for the Company;

                  (viii) fees and expense of non-affiliated auditors and
            accountants for the Company;

                  (ix) all expenses in connection with payments to the Directors
            and meetings of the Directors and Shareholders;

                  (x) expenses associated with listing the Shares and Securities
            on a securities exchange or NASDAQ if requested by the Directors or
            with the issuance and distribution of Shares and Securities, such as
            selling commissions and fees, taxes, legal and accounting fees,
            listing and registration fees;

                                      -19-
<PAGE>

                  (xi) expenses connected with payments of Dividends in cash or
            otherwise made or caused to be made by the Directors to the
            Shareholders;

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

                  (xiii) expenses of maintaining communications with
            Shareholders, including the cost of preparation, printing and
            mailing annual reports and other Shareholder reports, proxy
            statements and other reports required by governmental entities;

                  (xiv) expenses related to the Properties and Loans and other
            fees relating to making investments including personnel and other
            costs incurred in Property or Loan transactions where a fee is not
            payable to the Advisor; and

                  (xv) all other expenses the Advisor incurs in connection with
            providing services to the Company including reimbursement to the
            Advisor or its Affiliates for the cost of rent, goods, materials and
            personnel incurred by them based upon the compensation of the
            Persons involved and an appropriate share of overhead allocable to
            those Persons.

            No reimbursement shall be made for the cost of personnel to the
extent that such personnel are used in transactions for which the Advisor
receives a separate fee.

            Expenses incurred by the Advisor on behalf of the Company and
payable pursuant to this Section 10 shall be reimbursed quarterly to the Advisor
within 60 days after the end of each quarter. The Advisor shall prepare a
statement documenting the expenses of the Company during each quarter, and shall
deliver such statement to the Company within 45 days after the end of each
quarter.

            11. OTHER SERVICES. Should the Directors request that the Advisor or
any partner or employee thereof render services for the Company other than set
forth in Section 3 hereof, such services shall be separately compensated and
shall not be deemed to be services pursuant to the terms of this Agreement.

            12. FIDELITY BOND. The Advisor shall maintain a fidelity bond for
the benefit of the Company which bond shall insure the Company from losses of up
to $5,000,000 and shall be of the type customarily purchased by entities
performing services similar to those provided to the Company by the Advisor.

                                      -20-
<PAGE>

            13. REFUND BY ADVISOR. Within 60 days after the end of any fiscal
quarter of the Company which begins following the date the Company first
commences operations, if Operating Expenses of the Company during the fiscal
year, ending at the end of such quarter exceed the greater of (a) 2% of the
Average Invested Assets or (b) 25% of the Net Income of the Company during that
fiscal year and a majority of the Independent Directors find this excess amount
justified based on such unusual and non-recurring factors which they deem
sufficient, the Advisor may be reimbursed in future years for the full amount of
such excess expenses, or any portion thereof, but only to the extent such
reimbursement would not cause the Company's Operating Expenses to exceed the
2%/25% Guidelines in any such year. In no event shall the Operating Expenses
paid by the Company in any twelve month period ending at the end of a fiscal
quarter exceed the 2%/25% Guidelines. All figures used in the foregoing
computation shall be determined in accordance with generally accepted accounting
principles applied on a consistent basis. If the Advisor receives an incentive
fee for the sale of Property, Net Income, for purposes of calculating the
Operating Expenses, shall exclude the gain from the sale of such Property.

            14. OTHER ACTIVITIES OF THE ADVISOR. Nothing herein contained shall
prevent the Advisor from engaging in other activities, including without
limitation the rendering of advice to other investors (including other REITs)
and the management of other programs advised, sponsored or organized by the
Advisor or its Affiliates; nor shall this Agreement limit or restrict the right
of any director, officer, employee, partner or shareholder of the Advisor or its
Affiliates to engage in any other business or to render services of any kind to
any other partnership, corporation, firm, individual, trust or association. The
Advisor may, with respect to any investment in which the Company is a
participant, also render advice and service to each and every other participant
therein. The Advisor shall report to the Directors the existence of any
condition or circumstance, existing or anticipated, of which it has knowledge,
which creates or could create a conflict of interest between the Advisor's
obligations to the Company and its obligations to or its interest in any other
partnership, corporation, firm, individual, trust or association. The Advisor or
its Affiliates shall promptly disclose to the Directors knowledge of such
condition or circumstance. If the Sponsor, Advisor, Director or Affiliates
thereof have sponsored other investment programs with similar investment
objectives which have investment funds available at the same time as the
Company, it shall be the duty of the Directors (including the Independent
Directors) to adopt the method set forth in the Registration Statement or
another reasonable method by which properties are to be allocated to the
competing investment entities and to use their best efforts to apply such method
fairly to the Company.

            The Advisor shall be required to use its best efforts to present a
continuing and suitable investment program to the Company which is consistent
with the investment policies and objectives of the Company, but neither the
Advisor nor any Affiliate of the Advisor shall be obligated generally to present
any particular investment opportunity to the Company even if the opportunity is
of character which, if presented to the Company, could be taken by the Company.

            In the event that the Advisor or its Affiliates is presented with a
potential investment which might be made by the Company and by another
investment entity which the Advisor or its Affiliates advises or manages, the
Advisor shall consider the investment portfolio of each entity, cash flow of
each entity, the effect of the acquisition on the diversification of each

                                      -21-
<PAGE>

entity's portfolio, rental payments during any renewal period, the estimated
income tax effects of the purchase on each entity, the policies of each entity
relating to leverage, the funds of each entity available for investment, the
amount of equity required to make the investment and the length of time such
funds have been available for investment. To the extent that a Property might be
suitable for the Company and for another investment entity which is advised or
managed by the Advisor, the Advisor shall give priority to the investment
entity, including the Company, which has uninvested funds for the longest period
of time. The Advisor may consider the Property for private placement only if
such Property is deemed inappropriate for any investment entity which is advised
or managed by the Advisor, including the Company.

            15. RELATIONSHIP OF ADVISOR AND COMPANY. The Company and the Advisor
agree that they have not created and do not intend to create by this Agreement a
joint venture or partnership relationship between them and nothing in this
Agreement shall be construed to make them partners or joint venturers or impose
any liability as partners or joint venturers on either of them.

            16. TERM; TERMINATION OF AGREEMENT. This Agreement shall continue in
force until December 10, 2005, and thereafter shall be automatically renewed
from year to year, unless either party shall give notice in writing of
non-renewal to the other party not less than 60 days before the end of any such
year.

            17. TERMINATION BY COMPANY. At the sole option of a majority of the
Independent Directors, this Agreement may be terminated immediately by written
notice of termination from the Company to the Advisor if, in addition to the
occurrence of events which would constitute Cause, any of the following events
occur:

                  (a) If the Advisor shall violate any material provision of
            this Agreement, and after written notice of such violation, shall
            not cure such default within 30 days or have begun action within 30
            days to cure the default which shall be completed with reasonable
            diligence; or

                  (b) If the Advisor shall be adjudged bankrupt or insolvent by
            a court of competent jurisdiction, or an order shall be made by a
            court of competent jurisdiction for the appointment of a receiver,
            liquidator, or trustee of the Advisor, for all or substantially all
            of its property by reason of the foregoing, or if a court of
            competent jurisdiction approves any petition filed against the
            Advisor for reorganization, and such adjudication or order shall
            remain in force or unstayed for a period of 30 days; or

                  (c) If the Advisor shall institute proceedings for voluntary
            bankruptcy or shall file a petition seeking reorganization under the
            federal bankruptcy laws, or for relief under any law for relief of
            debtors, or shall consent to the appointment of a receiver for
            itself or for all or substantially all of its property, or shall
            make

                                      -22-
<PAGE>

            a general assignment for the benefit of its creditors, or shall
            admit in writing its inability to pay its debts, generally, as they
            become due.

            Any notice of termination under Section 16 or 17 shall be effective
on the date specified in such notice, which may be the day on which such notice
is given or any date thereafter. The Advisor agrees that if any of the events
specified in Section 17 (b) or (c) shall occur, it shall give written notice
thereof to the Directors within 15 days after the occurrence of such event.

            18. TERMINATION BY EITHER PARTY. This Agreement may be terminated
immediately without penalty by the Advisor by written notice of termination to
the Company upon the occurrence of events which would constitute Good Reason or
by the Company without cause or penalty by action of the Directors, the
Independent Directors or by action of a majority of the Shareholders, in either
case upon 60 days' written notice.

            19. ASSIGNMENT PROHIBITION. This Agreement may not be assigned by
the Advisor without the approval of a majority of the Directors (including a
majority of the Independent Directors); provided, however, that such approval
shall not be required in the case of an assignment to a corporation,
partnership, association, trust or organization which may take over the assets
and carry on the affairs of the Advisor, provided (i) that at the time of such
assignment, such successor organization shall be owned substantially by the then
partners of the Advisor or their Affiliates and only if such entity has a net
worth of at least $5,000,000 and (ii) that a general partner of the Advisor
shall deliver to the Directors a statement in writing indicating the ownership
structure and net worth of the successor organization and a certification from
the new Advisor as to its net worth. Such an assignment shall bind the assignees
hereunder in the same manner as the Advisor is bound by this Agreement. The
Advisor may assign any rights to receive fees or other payments under this
Agreement without obtaining the approval of the Directors. This Agreement shall
not be assigned by the Company without the consent of the Advisor, except in the
case of an assignment by the Company to a corporation or other organization
which is a successor to the Company, in which case such successor organization
shall be bound hereunder and by the terms of said assignment in the same manner
as the Company is bound by this Agreement.

            20. PAYMENTS TO AND DUTIES OF ADVISOR UPON TERMINATION.

            (a) After the Termination Date, the Advisor shall not be entitled to
compensation for further services hereunder except it shall be entitled to
receive from the Company within 30 days after the effective date of such
termination the following:

                  (i) all unpaid reimbursements of Organization and Offering
            Expenses and of Operating Expenses payable to the Advisor;

                  (ii) all earned but unpaid Asset Management Fees and
            Performance Fees payable to the Advisor prior to the termination of
            this Agreement;

                                      -23-
<PAGE>

                  (iii) all earned but unpaid Subordinated Acquisition Fees and
            all unaccrued Subordinated Acquisition Fees, in each case payable to
            the Advisor relating to the acquisition of any Property prior to the
            termination of this Agreement;

                  (iv) all earned but unpaid Subordinated Disposition Fees
            payable to the Advisor relating to the sale of any Property prior to
            the termination of this Agreement;

                  (v) all earned but unpaid Loan Refinancing Fees payable to the
            Advisor relating to the financing or refinancing of any Property
            prior to the termination of this Agreement; and

                  (vi) all earned but unpaid Property Management Fees payable to
            the Advisor or its Affiliates relating to the management of any
            property prior to the termination of this Agreement.

            Notwithstanding the foregoing, in the event this Agreement is
terminated by the Company for Cause or by the Advisor for other than Good
Reason, the Advisor will not be entitled to receive the sums in subparagraphs
20(a)(i)-(vi), above. All amounts payable to the Advisor in the event of a
termination shall be evidenced by a non-interest bearing promissory note (the
"Note") having a principal amount of the unpaid amount payable to the Advisor.

            (b) If this Agreement is terminated by the Company for any reason
other than Cause, by either party in connection with a Change of Control, or by
the Advisor for Good Reason, the Advisor shall be entitled to payment of the
Termination Fee.

            (c) The Termination Fee shall be paid in a manner determined by the
Directors, but in no event shall any portion of the Termination Fee remain
unpaid three years after the termination, non-renewal or substantial
modification of this Agreement, nor shall the Termination Fee be paid in less
than 12 equal quarterly installments, with interest, on the unpaid balance at
the prime rate of interest then in effect as published in The Wall Street
Journal. Notwithstanding the preceding sentence, any amounts which may be deemed
payable at the date the obligation to pay the Termination Fee is incurred (i)
shall be an amount which provides compensation to the Advisor only for that
portion of the holding period for the respective Properties during which the
Advisor provided services to the Company, (ii) shall not be due and payable
until the Property to which such fees relate is sold or refinanced, and (iii)
shall not bear interest until the Property to which such fees relate is sold or
refinanced. A portion of the Termination Fee shall be paid as each Property
owned by the Company on the Termination Date is sold. The portion of the
Termination Fee payable upon each such sale shall be equal to (y) the
Termination Fee multiplied by (z) the percentage calculated by dividing the
Appraised Value (at the Termination Date) of the Property sold by the Company
divided by the total Appraised Value (at the Termination Date) of all Properties
owned by the Company on the Termination Date.

            The Note for amounts payable as described above shall mature upon
the liquidation of the Company (or ten years from date of issuance whichever is
earlier) and shall be payable at any time prior to maturity. The compensation
payable under this Subsection shall be

                                      -24-
<PAGE>

paid or delivered to the Advisor within 30 days after funds shall become
available to the Company for the making of such payments.

            (d) Notwithstanding the foregoing, the Advisor shall not be entitled
to payment of the Termination Fee in the event this Agreement is terminated
because of failure of the Company and the Advisor to establish, pursuant to
Section 9(j) hereof, a fee structure appropriate for an entity with a perpetual
life in the event the Shares are listed on a national securities exchange or are
included for quotation on NASDAQ.

            (e) The Advisor shall promptly upon termination:

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

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

                  (iii) deliver to the Directors all assets, including
            Properties and Loans, and documents of the Company then in the
            custody of the Advisor; and

                  (iv) cooperate with the Company to provide an orderly
            management transition.

            21. INDEMNIFICATION BY THE COMPANY. The Company shall indemnify and
hold harmless the Advisor and its Affiliates, including their respective
officers, directors, partners and employees, from all liability, claims, damages
or losses arising in the performance of their duties hereunder, and related
expenses, including reasonable attorneys' fees, to the extent such liability,
claims, damages or losses and related expenses are not fully reimbursed by
insurance, subject to any limitations imposed by the laws of the State of
Maryland, the Articles of Incorporation or the Bylaws of the Company.
Notwithstanding the foregoing, the Advisor shall not be entitled to
indemnification or be held harmless pursuant to this Section 21 for any activity
which the Advisor shall be required to indemnify or hold harmless the Company
pursuant to Section 22.

            22. INDEMNIFICATION BY ADVISOR. The Advisor shall indemnify and hold
harmless the Company from liability, claims, damages, taxes or losses and
related expenses including attorneys' fees, to the extent that such liability,
claims, damages, taxes or losses and related expenses are not fully reimbursed
by insurance and are incurred by reason of the Advisor's bad faith, fraud,
willful misfeasance, misconduct, negligence or reckless disregard of its duties.

                                      -25-
<PAGE>

            23. NOTICES. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report or other communication is accepted by the party to
whom it is given, and shall be given by being delivered by hand or by overnight
mail or other overnight delivery service to the addresses set forth herein:

            To the Directors          Corporate Property Associates 14
            and to the Company:       Incorporated
                                      50 Rockefeller Plaza
                                      New York, NY  10020

            To the Advisor:           Carey Asset Management Corp.
                                      50 Rockefeller Plaza
                                      New York, NY  10020

            Either party may at any time give notice in writing to the other
party of a change in its address for the purposes of this Section 23.

            24. MODIFICATION. This Agreement shall not be changed, modified,
terminated, or discharged, in whole or in part, except by an instrument in
writing signed by both parties hereto, or their respective successors or
assignees.

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

            26. CONSTRUCTION. This Agreement shall be governed by, construed and
enforced in accordance with the laws of the State of New York.

            27. ENTIRE AGREEMENT. This Agreement contains the entire agreement
and understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements, understandings,
inducements and conditions, express or implied, oral or written, of any nature
whatsoever with respect to the subject matter hereof. The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof. This Agreement may not be modified or
amended other than by an agreement in writing.

            28. INDULGENCES, NOT WAIVERS. Neither the failure nor any delay on
the part of a party to exercise any right, remedy, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, power or privilege preclude any other or further
exercise of the same or of any other right, remedy, power or privilege, nor
shall any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege
with respect to any other occurrence. No waiver shall be effective unless it is
in writing and is signed by the party asserted to have granted such waiver.

                                      -26-
<PAGE>

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

            30. TITLES NOT TO AFFECT INTERPRETATION. The titles of Sections and
subsections contained in this Agreement are for convenience only, and they
neither form a part of this Agreement nor are they to be used in the
construction or interpretation hereof.

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

            32. NAME. W. P. Carey & Co. LLC has a proprietary interest in the
name "Corporate Property Associates" and "CPA(R)." Accordingly, and in
recognition of this right, if at any time the Company ceases to retain Carey
Asset Management Corp. or an Affiliate thereof to perform the services of
Advisor, the Directors of the Company will, promptly after receipt of written
request from Carey Property Advisors, cease to conduct business under or use the
name "Corporate Property Associates" or "CPA(R)" or any diminutive thereof and
the Company shall use its best efforts to change the name of the Company to a
name that does not contain the name "Corporate Property Associates" or "CPA(R)"
or any other word or words that might, in the sole discretion of the Advisor, be
susceptible of indication of some form of relationship between the Company and
the Advisor or any Affiliate thereof. Consistent with the foregoing, it is
specifically recognized that the Advisor or one or more of its Affiliates has in
the past and may in the future organize, sponsor or otherwise permit to exist
other investment vehicles (including vehicles for investment in real estate) and
financial and service organizations having "Corporate Property Associates" or
"CPA(R)" as a part of their name, all without the need for any consent (and
without the right to object thereto) by the Company or its Directors.

            33. INITIAL INVESTMENT. The Advisor has contributed to the Company
$200,000 in exchange for 20,000 Shares (the "Initial Investment"). The Advisor
or its Affiliates may not sell any of the Shares purchased with the Initial
Investment during the term of this Agreement. The restrictions included above
shall not continue to apply to any Shares other than the Share acquired through
the Initial Investment acquired by the Advisor or its Affiliates. The Advisor
shall not vote any Shares it now owns or hereafter acquires in any vote for the
election of Directors or any vote regarding the approval or termination of any
contract with the Advisor or any of its Affiliates.

                                      -27-
<PAGE>

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

                                   CORPORATE PROPERTY ASSOCIATES 14 INCORPORATED

                                   By: /s/ John J. Park
                                       ----------------------------------------
                                   Name: John J. Park
                                   Title: Chief Financial Officer

                                   CAREY ASSET MANAGEMENT CORP.

                                   By: /s/ John J. Park
                                       ----------------------------------------
                                   Name: John J. Park
                                   Title: Chief Financial Officer

                                      -28-
<PAGE>

                                    EXHIBIT A

                           RESTRICTED STOCK AGREEMENT

      This RESTRICTED STOCK AGREEMENT dated________, by and between Corporate
Property Associates 14 Incorporated ("CPA(R):14"), a Maryland corporation and
Carey Asset Management Corp. ("Advisor"), a Delaware corporation.

                                   WITNESSETH

      WHEREAS, CPA(R):14 and Advisor entered into an Advisory Agreement (the
"Advisory Agreement") pursuant to which Advisor provides various services to
CPA(R):14;

      WHEREAS, pursuant to the Advisory Agreement, CPA(R):14 is required to pay
certain fees to the Advisor and the Advisor may request that certain fees be
paid with common stock of the Company; and

      WHEREAS, the Advisor has requested that CPA(R):14 pay a portion of the
fees due to Advisor in the form of shares of common stock of CPA(R):14.

      NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows.

            1. Payment of Fees with Stock. CPA(R):14 hereby grants to
Advisor __________ shares of common stock of CPA(R):14 (the "Shares").

            2. Restrictions. The Shares are subject to vesting over a five-year
period. The Shares shall vest ratably over a five-year period with 20% of the
Shares paid in each payment vesting on each of the first through fifth
anniversary of the date hereof. Prior to the vesting of the ownership of the
Shares in the Advisor, the Shares may not be transferred by the Advisor.

            3. Immediate Vesting. Upon the expiration of the Advisory Agreement
for any reason other than a termination for Cause under paragraph 17 of the
Advisory Agreement or upon a "Change of Control" of CPA(R):14 (as defined
below), all Shares granted to the Advisor hereunder shall vest immediately and
all restrictions shall lapse. For purposes of this Agreement, a "Change of
Control" of the Company shall be deemed to have occurred if there has been a
<PAGE>

change in the ownership of the Company of a nature that would be required to be
reported in response to the disclosure requirements of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended
(the "Act"), as enacted and in force on the date hereof, whether or not the
Company is then subject to such reporting requirements; provided, however, that,
without limitation, a Change of Control shall be deemed to have occurred if:

            (i) any "person", as such term is used in Sections 13(d) and 14(d)
of the Act (other than the Company, any of its subsidiaries, any trustee,
fiduciary or other person or entity holding securities under any employee
benefit plan of the Company or any of its subsidiaries), together with all
"affiliates" and "associates" (as such terms are defined in Rule 14b-2 under the
Act) of such person, shall become the "beneficial owner" (as such term is
defined in Rule 13d-3 under the Act), directly or indirectly, of securities of
the Company representing 25% or more of either (A) the combined voting power of
the Company's then outstanding securities having the right to vote in an
election of the Company's Board of Directors ("Voting Securities") or (B) the
then outstanding common stock of the Company (in either such case other than as
a result of acquisition of securities directly from the Company);

            (ii) persons who, as of the date hereof, constitute the Company's
Board of Directors (the "Incumbent Directors") cease for any reason, including
without limitation, as a result of a tender offer, proxy contest, merger or
similar transaction, to constitute at least a majority of the Board of
Directors, provided that any person becoming a director of the Company
subsequent to the date hereof whose election or nomination for election was
approved by a vote of at least a majority of the Incumbent Directors shall, for
purposes of this Agreement, be considered an Incumbent Director; or

            (iii) the stockholders of the Company shall approve (A) any
consolidation or merger of the Company or any subsidiary where the stockholders
of the Company, immediately prior to the consolidation or merger, would not,
immediately after the consolidation or merger, beneficially own (as such term is
defined in Rule 13d-3 under the Act), directly or indirectly, shares
representing in the aggregate 50% or more of the voting equity of the entity
issuing cash

                                      -2-
<PAGE>

or securities in the consolidation or merger (or of its ultimate parent entity,
if any), (B) any sale, lease, exchange or other transfer (in one transaction or
a series of transactions contemplated or arranged by any party as a single plan)
of all or substantially all of the assets of the Company or (C) any plan or
proposal for the liquidation or dissolution of the Company.

            Notwithstanding the foregoing, a "Change of Control" shall not be
deemed to have occurred for purposes of the foregoing clause (i) solely as the
result of an acquisition of securities by the Company which, by reducing the
number of Shares of Common Stock outstanding, increases (x) the proportionate
number of Shares beneficially owned by any person to 25% or more of the Shares
then outstanding or (y) the proportionate voting power represented by the Shares
beneficially owned by any person to 25% or more of the combined voting power of
all then outstanding voting Securities; provided, however, that if any person
referred to in clause (x) or (y) of this sentence shall thereafter become the
beneficial owner of any additional Shares or other Voting Securities (other than
pursuant to a Share split, Share dividend, or similar transaction), then a
"Change of Control" shall be deemed to have occurred for purposes of the
foregoing clause (i).

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

                                           CORPORATE PROPERTY ASSOCIATES 14
                                           INCORPORATED

                                           By: _____________________________

                                           CAREY ASSET MANAGEMENT CORP.

                                           By:______________________________

                                      -3-

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