Document:

Moody National REIT II, Inc. 8-K

Exhibit 10.1

 

SECOND AMENDED AND RESTATED ADVISORY
AGREEMENT

 

AMONG

 

MOODY NATIONAL REIT II, INC.,

 

MOODY NATIONAL OPERATING PARTNERSHIP
II, LP,

 

AND

 

MOODY NATIONAL ADVISOR II, LLC

 

     

     

    

 

TABLE OF CONTENTS

 

	1.	DEFINITIONS	2
	2.	APPOINTMENT	6
	3.	DUTIES OF THE ADVISOR	6
	4.	AUTHORITY OF ADVISOR	8
	5.	BANK ACCOUNTS	8
	6.	RECORDS; ACCESS	8
	7.	LIMITATIONS ON ACTIVITIES	8
	8.	RELATIONSHIP WITH DIRECTORS	8
	9.	FEES	9
	10.	EXPENSES	10
	11.	OTHER SERVICES	11
	12.	REIMBURSEMENT TO THE ADVISOR	11
	13.	RELATIONSHIP OF THE PARTIES	11
	14.	OTHER ACTIVITIES OF THE ADVISOR	12
	15.	TERM OF AGREEMENT	12
	16.	TERMINATION BY THE PARTIES	12
	17.	ASSIGNMENT TO AN AFFILIATE	12
	18.	PAYMENTS TO AND DUTIES OF ADVISOR UPON TERMINATION	12
	19.	INDEMNIFICATION BY THE COMPANY AND THE OPERATING PARTNERSHIP	13
	20.	INDEMNIFICATION BY ADVISOR	14
	21.	EXCLUSION OF CERTAIN TRANSACTIONS	14
	22.	NON-SOLICITATION	14
	23.	NOTICES	14
	24.	MODIFICATION	14
	25.	SEVERABILITY	15
	26.	CONSTRUCTION	15
	27.	ENTIRE AGREEMENT	15
	28.	INDULGENCES, NOT WAIVERS	15
	29.	GENDER	15
	30.	TITLES NOT TO AFFECT INTERPRETATION	15
	31.	EXECUTION IN COUNTERPARTS	15
	32.	EFFECTIVENESS OF PARTS OF THE AGREEMENT	15

 

     

     

    

  

SECOND AMENDED AND RESTATED ADVISORY
AGREEMENT

 

THIS SECOND AMENDED
AND RESTATED ADVISORY AGREEMENT, dated as of the 12th day of June, 2017 (this “Agreement”), is entered into by and among
Moody National REIT II, Inc., a Maryland corporation (the “Company”), Moody National Operating Partnership II, LP,
a Delaware limited partnership (the “Operating Partnership”), and Moody National Advisor II, LLC, a Delaware limited
liability company (the “Advisor,” and collectively with the Company and the Operating Partnership, the “Parties”).
Capitalized terms used herein shall have the meanings ascribed to them in Section 1 below.

 

W I T N E S S E T H

 

WHEREAS, the Company
intends to qualify as a REIT, and to invest its funds in investments permitted by the terms of Sections 856 through 860 of the
Code;

 

WHEREAS, the Company
is the general partner of the Operating Partnership and has and intends to conduct all of its business and make all Investments
through the Operating Partnership;

 

WHEREAS, the Company,
the Operating Partnership and the Advisor are parties to that certain Advisory Agreement, dated as of the 12th day of
January, 2015, as amended (the “Original Agreement”);

 

WHEREAS, the Company
is a party to that certain agreement and plan of merger, dated as of November 16, 2016 (as the same may be amended from time to
time, the “Merger Agreement”), by and among the Company, the Operating Partnership, the Advisor, Moody Merger
Sub, LLC (“Merger Sub”), Moody National REIT I, Inc. (“REIT I”), Moody National Operating
Partnership I, LP (“REIT I Operating Partnership”) and Moody National Advisor I, LLC;

 

WHEREAS, pursuant to
the Merger Agreement, the Parties entered into an Amended and Restated Advisory Agreement, dated as of the 16th day
of November, 2016 (the “Amended and Restated Advisory Agreement”);

 

WHEREAS, pursuant to
the Merger Agreement and subject to the terms and conditions therein, upon the time that the Merger (defined below) becomes effective
(the “Merger Effective Time”), (i) REIT I will be merged with and into Merger Sub, with Merger Sub being the
surviving entity and a wholly-owned subsidiary of the Company and (ii) the Operating Partnership will be merged with REIT I Operating
Partnership, with REIT I Operating Partnership being the surviving entity (the foregoing merger transactions together, the “Merger”);

 

WHEREAS, pursuant to
the terms of the Amended and Restated Advisory Agreement, the Amended and Restated Advisory Agreement is to become effective at
the Merger Effective Time, provided, that if the Merger Agreement is terminated prior to the Merger Effective Time, then
the Amended and Restated Advisory Agreement will be deemed revoked and void ab initio;

 

WHEREAS, the Merger
Effective Time has not yet occurred as of the date first written above;

 

WHEREAS, the Company
intends to amend its Articles of Incorporation to (i) change the name of its sole class of common stock to “Class A Shares”
and to re-classify certain of its Class A Shares as “Class D Shares,” “Class I Shares,” and “Class
T Shares;”

 

WHEREAS, the Company
intends to amend the Registration Statement to include the offer and sale of the Class D Shares, Class I Shares and Class T Shares,
along with the Class A Shares;

 

WHEREAS, pursuant to
the Merger Agreement and to incorporate the above changes, the Parties now desire to amend and restate the Amended and Restated
Advisory Agreement pursuant to the terms hereof.

 

NOW, THEREFORE, in
consideration of the foregoing and of the mutual covenants and agreements contained herein, the Parties hereto, intending to be
legally bound, hereby agree as follows:

 

    1 

     

    

 

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

 

Acquisition
Expenses. Any and all expenses, exclusive of Acquisition Fees and Financing Coordination Fees, incurred by the Company, the
Operating Partnership, the Advisor, or any of their Affiliates in connection with the selection, evaluation, acquisition, origination,
making or development of any Investments, whether or not acquired or originated, including, without limitation, legal fees and
expenses, travel and communications expenses, costs of appraisals, nonrefundable option payments on property not acquired, accounting
fees and expenses, title insurance premiums, and the costs of performing due diligence.

 

Acquisition
Fees. Any and all fees and commissions, exclusive of Acquisition Expenses, paid by any Person to any other Person (including
any fees or commissions paid by or to any Affiliate of the Company, the Operating Partnership or the Advisor) in connection with
making or investing in any Investment or the purchase, development or construction of any Real Estate Asset, including real estate
commissions, selection fees, development fees, construction fees, nonrecurring management fees, loan fees, points or any other
fees of a similar nature. Excluded shall be development fees and construction fees paid to any Person not Affiliated with the Sponsor
in connection with the actual development and construction of a project.

 

Advisor.
Moody National Advisor II, LLC, a Delaware limited liability company, any successor advisor to the Company, the Operating Partnership
or any Person to which Moody National Advisor II, LLC or any successor advisor subcontracts substantially all of its functions.
Notwithstanding the foregoing, a Person hired or retained by Moody National Advisor II, LLC to perform hotel management and related
services for the Company or the Operating Partnership that is not hired or retained to perform substantially all of the functions
of Moody National Advisor II, LLC with respect to the Company or the Operating Partnership as a whole shall not be deemed to be
an Advisor.

 

Affiliate or
Affiliated. With respect to any Person, (i) any Person directly or indirectly owning, controlling or holding, with the power
to vote, ten percent (10%) or more of the outstanding voting securities of such other Person; (ii) any Person ten percent (10%)
or more of whose outstanding voting securities are directly or indirectly owned, controlled or held, with the 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; and (v) any legal entity for which such
Person acts as an executive officer, director, trustee or general partner of such other Person.

 

Amended
and Restated Advisory Agreement. The term “Amended and Restated Advisory Agreement” shall have the meaning set
forth in the Recitals hereto.

 

Articles of Incorporation.
The Articles of Incorporation of the Company, as amended from time to time.

 

Asset
Management Fee. The term “Asset Management Fee” shall mean the fee payable to the Advisor pursuant to Section 9(d).

 

Average Invested
Assets. For a specified period, the average of the aggregate book value of the assets of the Company invested, directly or
indirectly, in Investments before deducting depreciation, bad debts or other non-cash reserves, computed by taking the average
of such values at the end of each month during such period.

 

Board. The board
of directors of the Company, as of any particular time.

 

Bylaws. The bylaws of
the Company, as the same are in effect from time to time.

 

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

 

Class A Shares.
Shares of the Company’s $.01 par value common stock that have been designated as Class A.

 

Class D Shares.
Shares of the Company’s $.01 par value common stock that have been designated as Class D.

 

Class I Shares.
Shares of the Company’s $.01 par value common stock that have been designated as Class I.

 

Class T Shares.
Shares of the Company’s $.01 par value common stock that have been designated as Class T.

 

Code. Internal
Revenue Code of 1986, as amended from time to time, or any successor statute thereto. Reference to any provision of the Code shall
mean such provision as in effect from time to time, as the same may be amended, and any successor provision thereto, as interpreted
by any applicable regulations as in effect from time to time.

 

    2 

     

    

 

Company. The term “Company”
shall have the meaning set forth in the preamble of this Agreement.

 

Competitive
Brokerage Commission. The term “Competitive Brokerage Commission” means a real estate or brokerage commission for
the purchase or sale of a Property, Loan or Permitted Investment that is reasonable, customary, and competitive in light of the
size, type, and location of the Property, Loan or Permitted Investment.

 

Contract Sales Price.
The total consideration received by the Company for the sale of an Investment.

 

Dealer Manager.
Moody Securities, LLC, or such other Person or entity selected by the Board to act as the dealer manager for the Offering. Moody
Securities, LLC is a member of the Financial Industry Regulatory Authority.

 

Dealer Manager
Fee. Dealer Manager fees from the sale of Shares in the Primary Offering, payable to the Dealer Manager for serving as the
dealer manager of such Offering, as described in the most recent Prospectus.

 

Director. A member of
the Board.

 

Disposition Fees.
The term “Dispositions Fees” shall mean the fees payable to the Advisor pursuant to Section 9(c).

 

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

 

Effective Date. The commencement
date of the Initial Public Offering.

 

Excess Amount. The term
“Excess Amount” shall have the meaning set forth in Section 12.

 

Expense Year. The term
“Expense Year” shall have the meaning set forth in Section 12.

 

Financing Coordination
Fees. The term “Financing Coordination Fees” shall mean the fees payable to the Advisor pursuant to Section 9(e).

 

GAAP. Generally accepted
accounting principles as in effect in the United States of America from time to time.

 

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

 

Gross Proceeds.
The aggregate purchase price of all Shares sold for the account of the Company through all Offerings, without deduction for Sales
Commissions, volume discounts, any marketing support and due diligence expense reimbursement or Organization and Offering Expenses.
For the purpose of computing Gross Proceeds, the purchase price of any Share for which reduced Sales Commissions are paid to the
Dealer Manager or a Soliciting Dealer (where net proceeds to the Company are not reduced) shall be deemed to be the full amount
of the offering price per Share pursuant to the Prospectus for such Offering without reduction.

 

Indemnitee.
The terms “Indemnitee and “Indemnitees” shall have the meaning set forth in Section 19 herein.

 

Independent
Director. The term “Independent Director” shall have the meaning set forth in the Articles of Incorporation.

 

Initial Public Offering.
The initial public offering of Shares registered pursuant to the Registration Statement.

 

Investments.
Any investments by the Company or the Operating Partnership in Real Estate Assets and Securities and Debt-Related Investments.

 

Joint Ventures.
The joint venture or partnership arrangements (other than with the Operating Partnership) in which the Company or any of its subsidiaries
is a co-venturer or general partner which are established to acquire Real Properties.

 

    3 

     

    

 

Listing.
The listing of the Shares on a national securities exchange or the receipt by the Company’s Stockholders of securities that
are listed on a national securities exchange in exchange for the Company’s common stock. Upon such Listing, the Shares shall
be deemed Listed.

 

Loans.
Any indebtedness or obligations in respect of borrowed money or evidenced by bonds, notes, debentures, deeds of trust, letters
of credit or similar instruments, including mortgages and mezzanine loans.

 

Merger.
The term “Merger” shall have the meaning set forth in the Recitals hereto.

 

Merger Agreement.
The term “Merger Agreement” shall have the meaning set forth in the Recitals hereto.

 

Merger Disposition
Fee. The fee payable to REIT I Advisor pursuant to Section 1.1 of that certain Termination Agreement by and among REIT I, REIT
I Operating Partnership, REIT I Advisor, Moody National Realty, L.P., Moody National LPOP I, LLC and the Company.

 

Merger Effective Time. The term “Merger
effective Time” shall have the meaning set forth in the Recitals hereto.

 

NASAA REIT
Guidelines. The Statement of Policy Regarding Real Estate Investment Trusts published by the North American Securities Administrators
Association as in effect on the Effective Date, as may be modified from time to time.

 

Net Income.
For any period, the Company’s total revenues applicable to such period, less the total expenses applicable to such period
other than additions to reserves for depreciation, bad debts or other similar non-cash reserves and excluding any gain from the
sale of the Company’s assets.

 

Offering. The public
offering of Shares pursuant to a Prospectus.

 

Operating Partnership.
The term “Operating Partnership” shall have the meaning set forth in the preamble of this Agreement.

 

Operating Partnership
Agreement. The Second Amended and Restated Limited Partnership Agreement of Moody National Operating Partnership II, LP, as
amended or restated from time to time.

 

OP Limited Partnership Interests.
Limited partnership interests in the Operating Partnership.

 

Organization
and Offering Expenses. Organization and Offering Expenses means all expenses incurred by or on behalf of the Company in connection
with and in preparing the Company for registration of and subsequently offering and distributing its Shares to the public, whether
incurred before or after the date of this Agreement, which may include but are not limited to, total underwriting and brokerage
discounts and commissions (including fees of the underwriters’ attorneys); any expense allowance granted by the Company to
the underwriter or any reimbursement of expenses of the underwriter by the Company; expenses for printing, engraving and mailing;
salaries of employees while engaged in sales activity; telephone and other telecommunications costs; all advertising and marketing
expenses (including the costs related to investor and broker-dealer sales meetings); charges of transfer agents, registrars, trustees,
escrow holders, depositaries and experts; and expenses of qualification of the sale of the securities under Federal and State laws,
including taxes and fees, accountants’ and attorneys’ fees.

 

Original Agreement. The
term “Original Agreement” shall have the meaning set forth in the Recitals hereto.

 

Person. An individual,
corporation, partnership, trust, joint venture, limited liability company or other entity.

 

Primary Offering.
The portion of an Offering other than the Shares offered pursuant to the Company’s distribution reinvestment plan.

 

Property Manager.
An Affiliated entity that has been retained to perform and carry out property-management services at one or more of the Real Estate
Assets.

 

Prospectus.
A “Prospectus” under Section 2(10) of the Securities Act of 1933, as amended (the “Securities Act”), including
a preliminary Prospectus, an offering circular as described in Rule 253 of the General Rules and Regulations under the Securities
Act or, in the case of an intrastate offering, any document by whatever name known, utilized for the purpose of offering and selling
securities to the public.

 

    4 

     

    

 

Real Estate
Assets. Any investments by the Company or the Operating Partnership in unimproved and improved Real Property (including, without
limitation, fee or leasehold interests, options and leases) either directly or through a Joint Venture.

 

Real Property.
Real property owned from time to time by the Company or the Operating Partnership, either directly or through joint venture arrangements
or other partnerships which consists of (i) land only, (ii) land, including the buildings located thereon, (iii) buildings only
or (iv) such investments the Board and the Advisor mutually designate as Real Property to the extent such investments could be
classified as Real Property.

 

Registration
Statement. Registration Statement shall mean the Company’s registration statement on Form S-11 (Registration Number 333198305),
as amended from time to time, in connection with the Initial Public Offering.

 

REIT. A “real
estate investment trust” under Sections 856 through 860 of the Code or as may be amended.

 

REIT
I Property. Any property including, but not limited to (i) land, (ii) land including the buildings located thereon, (iii) buildings
only and (iv) such investments the Board and the Advisor mutually deem to be REIT I Property, in each case that (A) was owned by
REIT I immediately prior to the Merger Effective Time and (B) is subject to a Sale during the period beginning on the date on which
the Merger Effective Time occurs and ending on the date that is one (1) year following the date on which the Merger Effective Time
occurs.

 

REIT
I Property Merger Disposition Fee. The portion of the Merger Disposition Fee allocable to a REIT I Property, determined in
accordance with Schedule I, attached hereto.

 

Sale or Sales.
Any transaction or series of transactions whereby: (i) the Company or the Operating Partnership directly or indirectly (except
as described in other subsections of this definition) sells, grants, transfers, conveys, or relinquishes its ownership of any Real
Property or portion thereof, including the lease of any Real Property consisting of a building only, and including any event with
respect to any Real Property which gives rise to a significant amount of insurance proceeds or condemnation awards; (ii) the Company
or the Operating Partnership directly or indirectly (except as described in other subsections of this definition) sells, grants,
transfers, conveys, or relinquishes its ownership of all or substantially all of the interest of the Corporation or the Operating
Partnership in any Joint Venture in which it is a co-venturer or partner; (iii) any Joint Venture directly or indirectly (except
as described in other subsections of this definition) in which the Company or the Operating Partnership as a co-venturer or partner
sells, grants, transfers, conveys, or relinquishes its ownership of any Real Property or portion thereof, including any event with
respect to any Real Property which gives rise to insurance claims or condemnation awards; or (iv) the Company or the Operating
Partnership directly or indirectly (except as described in other subsections of this definition) sells, grants, conveys or relinquishes
its interest in any Securities and Debt-Related Investment or portion thereof (including with respect to any Loan, all payments
thereunder or in satisfaction thereof other than regularly scheduled interest payments) and any event which gives rise to a significant
amount of insurance proceeds or similar awards; or (v) the Company or the Operating Partnership directly or indirectly (except
as described in other subsections of this definition) sells, grants, transfers, conveys, or relinquishes its ownership of any other
asset not previously described in this definition or any portion thereof, but not including any transaction or series of transactions
specified in clauses (i) through (v) above in which the proceeds of such transaction or series of transactions are reinvested by
the Company in one or more assets within 180 days thereafter.

 

Sales Commission.
Selling commissions from the sale of Shares in the Primary Offering payable to the Dealer Manager and reallowable to Soliciting
Dealers with respect to Shares sold by them as described in the most recent Prospectus.

 

Securities
and Debt-Related Investments. Any investments by the Company or the Operating Partnership in (i) real estate securities such
as common stocks, preferred stocks and options to acquire stock in REITs and other real estate companies and (ii) debt-related
investments such as (a) mortgage, mezzanine, bridge and other loans and (b) debt and derivative securities related to real estate
assets including mortgage-backed securities, collateralized debt obligations, debt securities issued by real estate companies and
credit default swaps.

 

Shares. The Class
A Shares, Class D Shares, Class I Shares and Class T Shares.

 

Soliciting
Dealers. Broker-dealers who are members of the Financial Industry Regulatory Authority, Inc., or that are exempt from broker-dealer
registration, and who, in either case, have executed participating broker or other agreements with the Dealer Manager to sell Shares.

 

Special OP
Limited Partnership Interests. Special OP Limited Partnership Interests means the separate series of limited partnership interests
to be issued in accordance with Section 9(g).

 

    5 

     

    

 

Sponsor.
Any Person which (i) is directly or indirectly instrumental in organizing, wholly or in part, the Company, (ii) will control, manage
or participate in the management of the Company, and any Affiliate of any such Person, (iii) takes the initiative, directly or
indirectly, in founding or organizing the Company, either alone or in conjunction with one or more other Persons, (iv) receives
a material participation in the Company in connection with the founding or organizing of the business of the Company, in consideration
of services or property, or both services and property, (v) has a substantial number of relationships and contacts with the Company,
(vi) possesses significant rights to control the Company’s Investments, (vii) receives fees for providing services to the
Company which are paid on a basis that is not customary in the industry, or (viii) provides goods or services to the Company on
a basis which was not negotiated at arm’s-length with the Company. “Sponsor” does not include wholly independent
third parties such as attorneys, accountants and underwriters whose only compensation is for professional services.

 

Stockholders. The
registered holders of the Shares.

 

Termination Date.
The date of termination of this Agreement.

 

Termination
Event. The termination or nonrenewal of this Agreement (i) in connection with a merger, sale of assets or transaction involving
the Company pursuant to which a majority of the Directors then in office are replaced or removed, (ii) by the Advisor for Good
Reason or (iii) by the Company and the Operating Partnership other than for Cause.

 

Total Operating
Expenses. All costs and expenses paid or incurred by the Company, as determined under GAAP, that are in any way related to
the operation of the Company or its business, including asset management fees and other fees paid to Advisors, but excluding (i)
the expenses of raising capital such as Organization and Offering Expenses, legal, audit, accounting, underwriting, brokerage,
listing, registration, and other fees, printing and other such expenses and taxes incurred in connection with the issuance, distribution,
transfer, registration and Listing, (ii) interest payments, (iii) taxes, (iv) non-cash expenditures such as depreciation, amortization
and bad debt reserves, (v) incentive fees paid in compliance with the NASAA REIT Guidelines; (vi) Acquisition Fees and Acquisition
Expenses, (vii) real estate commissions on the Sale of Real Property, and (viii) other fees and expenses connected with the acquisition,
disposition, management and ownership of real estate interests, mortgages or other property (including the costs of foreclosure,
insurance premiums, legal services, maintenance, repair, and improvement of property). The definition of “Total Operating
Expenses” set forth above is intended to encompass only those expenses which are required to be treated as Total Operating
Expenses under the NASAA REIT Guidelines. As a result, and notwithstanding the definition set forth above, any expense of the Company
which is not part of Total Operating Expenses under the NASAA REIT Guidelines shall not be treated as part of Total Operating Expenses
for purposes hereof.

 

2%/25% Guidelines.
The term “2%/25% Guidelines” shall have the meaning set forth in Section 12.

 

2.  APPOINTMENT. The Company and the Operating Partnership hereby appoint the Advisor to serve as their 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 and the Operating Partnership
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 by the Directors, and as amended from time to time with the approval of the
Stockholders. In performance of this undertaking, subject to the supervision of the Directors and consistent with the provisions
of the Articles of Incorporation and Bylaws of the Company and the Operating Partnership Agreement, the Advisor shall, either directly
or by engaging an Affiliate:

 

(a)     assist in
the development of the Initial Public Offering and any subsequent Offering approved by the Board, including the determination of
the specific terms of the securities to be offered by the Company, preparation of all offering and related documents, and obtaining
all required regulatory approvals of such documents

 

(b)     serve as the
Company’s and the Operating Partnership’s investment and financial advisor;

 

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

 

(d)     investigate,
select, and, on behalf of the Company and the Operating Partnership, 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, real estate management
companies, real estate operating companies, securities investment advisors, 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
and the Operating Partnership with any of the foregoing;

 

    6 

     

    

 

(e)     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 or the Operating Partnership;

 

(f)     subject to the provisions of Section 4 hereof, (i) participate in formulating an investment strategy and asset allocation framework,
(ii) locate, analyze and select potential Investments, (iii) structure and negotiate the terms and conditions of transactions pursuant
to which acquisitions and dispositions of Investments will be made; (iv) research, identify, review and recommend acquisitions
and dispositions of Investments to the Board and make investments on behalf of the Company and the Operating Partnership in compliance
with the investment objectives and policies of the Company; (v) 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, Investments;
(vi) enter into leases and service contracts for Real Estate Assets and, to the extent necessary, perform all other operational
functions for the maintenance and administration of such Real Estate Assets; (vii) actively oversee and manage Investments for
purposes of meeting the Company’s investment objectives; (vii) select Joint Venture partners, structure corresponding agreements
and oversee and monitor these relationships; (viii) oversee the performance of the Property Manager or third-party property managers
who perform services for the Company or the Operating Partnership; (ix) oversee Affiliated and non-Affiliated Persons with whom
the Advisor contracts to perform certain of the services required to be performed under this Agreement; (x) manage accounting and
other record-keeping functions for the Company and the Operating Partnership; and (xi) recommend various liquidity events to the
Board when appropriate;

 

(g)     upon request,
provide the Directors with periodic reports regarding prospective investments;

 

(h)     make investments
in, and dispositions of, Investments within the discretionary limits and authority as granted by the Board;

 

(i)      negotiate on behalf of the Company and the Operating Partnership with banks or lenders for Loans to be made to the Company and
the Operating Partnership, and negotiate on behalf of the Company and the Operating Partnership with investment banking firms and
broker-dealers or negotiate private sales of Shares or obtain Loans for the Company and the Operating Partnership, 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 or
the Operating Partnership;

 

(j)     obtain reports (which may, but are not required to, be prepared by the Advisor or its Affiliates), where appropriate, concerning
the value of Investments or contemplated investments of the Company and the Operating Partnership;

 

(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 and the Operating Partnership under this Agreement, including reports with respect to potential conflicts of interest
involving the Advisor or any of its affiliates;

 

(l)      provide the Company and the Operating Partnership with all necessary cash management services;

 

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

 

(n)     deliver to,
or maintain on behalf of, the Company copies of all appraisals obtained in connection with the investments in any Real Estate Assets
as may be required to be obtained by the Board;

 

(o)     notify the
Board of all proposed material transactions before they are completed; and

 

(p)     effect any
private placement of OP Limited Partnership Interests, tenancy-in-common or other interests in Investments as may be approved by
the Board.

 

Notwithstanding
the foregoing, the Advisor may delegate any of the foregoing duties to any Person so long as the Advisor or any Affiliate remains
responsible for the performance of the duties set forth in this Section 3.

 

    7 

     

    

 

4.  AUTHORITY OF ADVISOR.

 

(a)     Pursuant to
the terms of this Agreement (including the restrictions included in this Section 4 and in Section 7), and subject to the continuing
and exclusive authority of the Board over the management of the Company, the Board hereby delegates to the Advisor the authority
to perform the services described in Section 3.

 

(b)     Notwithstanding
the foregoing, any investment in Investments, including any financing of such Investment will require the prior approval of the
Board. The Advisor will deliver to the Board all documents and other information required by the Board or any committee of the
Board, as the case may be, to evaluate a proposed Investment (and any financing related to such proposed investment).

 

(c)     If a transaction
requires approval by the Independent Directors, the Advisor will deliver to the Independent Directors all documents and other information
required by them to properly evaluate the proposed transaction.

 

(d)     The prior
approval of a majority of the Independent Directors not otherwise interested in the transaction and a majority of the Directors
not otherwise interested in the transaction will be required for each transaction to which the Advisor or its Affiliates is a party.

 

(e)     The Board
may, at any time upon the giving of written notice to the Advisor, modify or revoke the authority set forth in this Section 4;
provided, however, that such modification or revocation shall be effective upon receipt by the Advisor and shall not be applicable
to investment transactions to which the Advisor has committed the Company or the Operating Partnership 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 the Operating
Partnership or in the name of the Company and the Operating Partnership 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 or the Operating Partnership, under such terms
and conditions as the Directors may approve, 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
and the Operating Partnership.

 

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 (a) adversely affect the ability of the Company to qualify
or continue to qualify as a REIT under the Code unless the Board has determined that the Company will not seek or maintain REIT
qualification, (b) subject the Company to regulation under the Investment Company Act of 1940, as amended, or (c) violate any law,
rule, regulation or statement of policy of any governmental body or agency having jurisdiction over the Company or its Shares,
or otherwise not be permitted by the Articles of Incorporation or Bylaws of the Company, except if such action shall be ordered
by the Board, in which case the Advisor shall notify promptly the Board of the Advisor’s judgment of the potential impact
of such action and shall refrain from taking such action until it receives further clarification or instructions from the Board.
In such event, the Advisor shall have no liability for acting in accordance with the specific instructions of the Board so given.
Notwithstanding the foregoing, the Advisor, its directors, officers, employees and members, and partners, directors, officers,
members and stockholders of the Advisor’s Affiliates shall not be liable to the Company or to the Directors or Stockholders
for any act or omission by the Advisor, its directors, officers, employees, or members, and partners, directors, officers, members
or stockholders of the Advisor’s Affiliates taken or omitted to be taken in the performance of their duties under this Agreement
except as provided in Section 19 of this Agreement.

 

8.  RELATIONSHIP WITH DIRECTORS. Subject to Section 7 of this Agreement and to restrictions advisable with respect to the qualification
of the Company as a REIT, directors, officers and employees of the Advisor or an Affiliate of the Advisor or any corporate parents
of an Affiliate, may serve as a Director and as officers of the Company, except that no director, officer 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 reasonable reimbursement for travel and related expenses incurred in attending meetings of
the Directors and no such Director shall be deemed an Independent Director for purposes of satisfying the Director independence
requirement set forth in the Articles of Incorporation.

 

    8 

     

    

 

9.  FEES.

 

(a) Acquisition
Fees.

 

(i) The Advisor
shall receive an Acquisition Fee payable by the Company as compensation for services rendered in connection with the investigation,
selection and acquisition (by purchase, investment, exchange, sourcing or origination) of Investments. The total Acquisition Fees
payable to the Advisor or its Affiliates shall equal 1.5% of (i) the cost of all Investments, including Acquisition Expenses and
any debt attributed to such Investments and excluding Acquisition Fees and Financing Coordination Fees, or (ii) the amount funded
by the Company to acquire or originate a Loan, including Acquisition Expenses related to such Investments and any debt used to
fund the acquisition or origination of a Loan and excluding Acquisition Fees and Financing Coordination Fees. With respect to the
acquisition of Real Estate Assets through a Joint Venture, the Acquisition Fee payable by the Company to the Advisor shall equal
1.5% of the Company’s allocable cost of such Real Estate Assets, including Acquisition Expenses and any debt attributed to
such Investments and excluding Acquisition Fees and Financing Coordination Fees. Once the proceeds from the Primary Offering have
been fully invested, the aggregate amount of Acquisition Fees and Financing Coordination Fees shall not exceed 1.9% of the Contract
Sales Price and the amount advanced for a Loan or other Investment for all the assets acquired. The Advisor shall submit an invoice
to the Company following the closing or closings of each Investment, accompanied by a computation of the Acquisition Fee. The Acquisition
Fee payable to the Advisor shall be paid at the closing of the transaction upon receipt of the invoice by the Company.

 

(ii) With respect
to and upon the effectiveness of the Merger, the Advisor shall be entitled to receive an Acquisition Fee payable by the Company
equal to 1.5% of the aggregate Cash Consideration (as such term is defined in the Merger Agreement) paid to stockholders of REIT
I in the Merger. For the avoidance of doubt, the Acquisition Fee as described in the preceding sentence shall be the only Acquisition
Fee to which the Advisor is entitled with respect to the Merger, and the Advisor hereby waives any rights it may have under the
Original Agreement or the Amended and Restated Advisory Agreement to collect any other Acquisition Fee in connection with the Merger.

 

(b)     Limitation
on Total Acquisition Fees, Financing Coordination Fees and Acquisition Expenses. Pursuant to the NASAA REIT Guidelines, the
total of all Acquisition Fees, Acquisition Expenses and Financing Coordination Fees shall not exceed 6.0% of the “contract
purchase price,” as defined in the Articles of Incorporation, of all Investments acquired.

 

(c)     Disposition
Fees.

 

(i) If the Advisor
provides a substantial amount of services, as determined by the Independent Directors in connection with a Sale, the Company shall
pay a Disposition Fee to the Advisor equal to the lesser of (i)(a) where a brokerage commission is also payable to a third party,
one-half of the aggregate brokerage commission paid, including brokerage commissions payable to third parties, or (b) where no
brokerage commission is payable to any third party, the Competitive Brokerage Commission or (ii) 3.0% of the Contract Sales Price.
With respect to a Property held in a Joint Venture, the Disposition Fee will be equal to the percentage of the “contract
purchase price” reflecting the Company’s economic interest in the Joint Venture. Any Disposition Fee payable under
this Section 9(c) may be paid in addition to real estate commissions paid to non-Affiliates, provided that the total real estate
commissions (including such Disposition Fee) paid to all Persons by the Company for each Investment shall not exceed 6.0% of the
Contract Sales Price.

 

(ii) Notwithstanding
anything herein to the contrary, Advisor shall only be entitled to a Disposition Fee with respect to the Sale of any REIT I Property
to the extent of the excess of (a) the Disposition Fee attributable to such REIT I Property calculated in accordance with Section
9(c)(i) over (b) the REIT I Property Merger Disposition Fee applicable to such REIT I Property.

 

(d)     Asset Management
Fee. The Advisor shall receive the Asset Management Fee as compensation for services rendered pursuant to Section 3 of this
Agreement in connection with the management of the Company’s assets. The Asset Management Fee shall be calculated monthly
and consists of a monthly fee of one-twelfth of 1.0% of the aggregate cost (before non-cash reserves and depreciation) of all Investments
the Company owns, including Acquisition Fees, Acquisition Expenses and any debt attributable to such Investments. With the exception
of any portion of the Asset Management Fee related to the disposition of Investments, which shall be payable at the time of such
disposition, the Asset Management Fee shall be payable on the first of each month.

 

    9 

     

    

 

(e)     Financing
Coordination Fees. The Advisor shall receive a Financing Coordination Fee as compensation for services rendered in connection
with the coordination of debt financing obtained by the Company. The total Financing Coordination Fee payable to the Advisor or
its Affiliates shall equal (i) 1.0% of the amount available under any loan or line of credit originated or assumed, directly or
indirectly, in connection with the acquisition of Real Properties or other permitted Investments, by the Company, and will be in
addition to the Acquisition Fees paid to the Advisor; (ii) 0.75% of the amount available or outstanding under any refinanced loan
or line of credit of the Company, and will be in addition to the Acquisition Fees paid to the Advisor; or (iii) 0.75% of the Company’s
proportionate share of the amount available or outstanding under any refinanced loan or line of credit in the case of Investments
made through a Joint Venture, and will be in addition to the Acquisition Fees paid to the Advisor. Financing Coordination Fees
will only be payable if the Advisor or its Affiliates provides services in connection with the origination, assumption or refinancing
of debt that the Company uses to acquire Real Properties or other permitted Investments. The Advisor may pay some or all of the
Financing Coordination Fee to third parties if the Advisor subcontracts with such third parties to coordinate financing obtained
by the Company. The Advisor shall submit an invoice to the Company following the closing or closings of each debt financing or
refinancing obtained by the Company, accompanied by a computation of the Financing Coordination Fee. The Financing Coordination
Fee payable to the Advisor shall be paid at the closing of the debt financing upon receipt of the invoice by the Company.

 

(f)     Special Limited Partnership Interests. In addition to the fees provided in this Section 9, an Affiliate of the Advisor has
made a capital contribution of $1,000 to the Operating Partnership in exchange for Special Limited Partnership Interests. The Special
Limited Partnership Interests shall be entitled to the distributions provided for, and shall be subject to redemption by the Operating
Partnership, in accordance with the terms of the Operating Partnership Agreement. To the extent distributions to the Special Limited
Partnership Interests are not paid from net sales proceeds, such amounts will count against the limit on Total Operating Expenses
set forth in the Articles of Incorporation.

 

10.  EXPENSES.

 

(a) In addition
to the fees paid to the Advisor pursuant to Section 9 hereof and subject to the limitations set forth in the Articles of Incorporation,
the Company or the Operating Partnership shall pay directly or reimburse the Advisor for all of the expenses paid or incurred by
the Advisor in connection with the services it provides to the Company and the Operating Partnership pursuant to this Agreement,
including, but not limited to:

 

(i)      
Organizational and Offering Expenses; provided, however, that (1) the Company shall not reimburse the Advisor to the extent such
reimbursement would cause the total amount of Organization and Offering Expenses attributable to the Initial Public Offering paid
by the Company and the Operating Partnership to exceed 15.0% of the Gross Proceeds from the Initial Public Offering raised as of
the date of the reimbursement; (2) within 60 days after the end of the month in which the current Offering terminates, the Advisor
shall reimburse the Company to the extent the Organizational and Offering Expenses borne by the Company exceed 15% of the Gross
Proceeds raised in the completed Offering; and (3) the Company shall not reimburse the Advisor for any Organization and Offering
Expenses that the Independent Directors determine are not fair and commercially reasonable to the Company.

 

(ii)     
Acquisition Expenses incurred in connection with the selection and acquisition of Investments subject to the aggregate 6.0% cap
on Acquisition Fees, Acquisition Expenses and Financing Coordination Fees set forth in Section 9(b);

 

(iii)     the actual
cost of goods and services used by the Company and obtained from entities not affiliated with the Advisor;

 

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

 

(v)      taxes and assessments on income of the Company or Investments;

 

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

 

(vii)    expenses of managing and operating Investments owned by the Company, whether payable to an Affiliate of the Company or a non-Affiliated
Person;

 

(viii)  
all expenses in connection with payments to the Directors for attending meetings of the Directors and Stockholders;

 

    10 

     

    

 

(ix)    expenses
associated with a Listing, if applicable, or with the issuance and distribution of Shares, such as selling commissions and fees,
advertising expenses, taxes, legal and accounting fees, listing and registration fees, and other Organization and Offering Expenses;

 

(x)    
expenses connected with payments of Distributions in cash or otherwise made or caused to be made by the Company to the Stockholders;

 

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

 

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

 

(xiii)  administrative service expenses (including (a) personnel costs; provided, however, that no reimbursement shall be made for costs
of personnel to the extent that such personnel perform services in transactions for which the Advisor receives Acquisition Fees,
Financing Coordination Fees, Asset Management Fees, hotel management fees or real estate sales commissions, and (b) the Company’s
allocable share of other overhead of the Advisor such as rent and utilities); and

 

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

 

(xv)   out-of-pocket costs for the Company to comply with all applicable laws, regulations and ordinances, including without limitation,
the Sarbanes-Oxley Act of 2002, as amended; and

 

(xvi)  all other out-of-pocket costs incurred by the Advisor in performing its duties hereunder.

 

(b) Expenses
incurred by the Advisor on behalf of the Company and the Operating Partnership and payable pursuant to this Section 10 shall be
reimbursed no less than monthly to the Advisor. The Advisor shall prepare a statement documenting the expenses of the Company and
the Operating Partnership and the calculation of the Asset Management Fee during each quarter, and shall deliver such statement
to the Company and the Operating Partnership within 45 days after the end of each quarter.

 

11.  OTHER SERVICES.
Should the Directors request that the Advisor or any director, officer or employee thereof render services for the Company and
the Operating Partnership other than set forth in Section 3, such services shall be separately compensated at such rates and in
such amounts as are agreed by the Advisor and the Independent Directors, subject to the limitations contained in the Articles of
Incorporation, and shall not be deemed to be services pursuant to the terms of this Agreement.

 

12.  REIMBURSEMENT TO THE ADVISOR. The Company may reimburse the Advisor, at the end of each fiscal quarter, for Total Operating
Expenses incurred by the Advisor; provided, however, that the Company shall not reimburse the Advisor at the end of any fiscal
quarter commencing on the fourth fiscal quarter after the quarter in which the Corporation makes its first investment in an Asset,
for Total Operating Expenses that, in the four consecutive fiscal quarters then ended, exceed the greater of two percent of Average
Invested Assets or 25% of Net Income (the “2%/25% Guidelines”) for such 12-month period. Any Excess Amount paid
to the Advisor during a fiscal quarter shall be repaid to the Company or, at the option of the Company, subtracted from the Total
Operating Expenses reimbursed during the subsequent fiscal quarter. If there is an Excess Amount in any Expense Year and the Independent
Directors determine that such excess was justified based on unusual and nonrecurring factors which they deem sufficient, then the
Excess Amount may be carried over and included in Total Operating Expenses in subsequent Expense Years and reimbursed to the Advisor
in one or more of such years, provided that there shall be sent to the Stockholders a written disclosure of such fact, together
with an explanation of the factors the Independent Directors considered in determining that such excess expenses were justified.
Such determination shall be reflected in the minutes of the meetings of the Board. The Company will not reimburse the Advisor or
its Affiliates for services for which the Advisor or its Affiliates are entitled to receive Acquisition Fees, Financing Coordination
Fees, Asset Management Fees, hotel management fees or real estate commissions. All figures used in the foregoing computation shall
be determined in accordance with generally accepted accounting principles applied on a consistent basis.

 

13. 
RELATIONSHIP OF THE PARTIES. The Company and the Operating Partnership, on the one hand, and the Advisor on the other, are
not partners or joint venturers with each other, and nothing in this Agreement shall be construed to make them such partners of
joint venturers or impose any liability as such on either of them.

 

    11 

     

    

 

14. 
OTHER ACTIVITIES OF THE ADVISOR. Nothing herein contained shall prevent the Advisor or any of its Affiliates from engaging
in or earning fees from other activities, including, without limitation, the rendering of advice to other Persons (including other
REITs) and the management of other programs advised, sponsored or organized by the Advisor or its Affiliates; nor shall this Agreement
limit or restrict the right of any director, officer, member, partner, employee, or stockholder of the Advisor or its Affiliates
to engage in or earn fees from any other business or to render services of any kind to any other partnership, corporation, firm,
individual, trust or association and earn fees for rendering such services. The Advisor may, with respect to any Investment in
which the Company is a participant, also render advice and service to each and every other participant therein, and earn fees for
rendering such advice and service. Specifically, it is contemplated that the Company may enter into joint ventures or other similar
co-investment arrangements with certain Persons, and pursuant to the agreements governing such joint ventures or arrangements,
the Advisor may be engaged to provide advice and service to such Persons, in which case the Advisor will earn fees for rendering
such advice and service.

 

The Advisor shall
report to the Board 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 Board knowledge of such condition or circumstance. If the Advisor or its Affiliates 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 Board (including the Independent Directors) to ensure that the Advisor and its Affiliates adopt the method approved by the
Independent Directors by which investments are to be allocated to the competing investment entities and to use their best efforts
to ensure that such method is applied fairly to the Company.

 

15. 
TERM OF AGREEMENT. This Agreement shall have an initial term of one year from the Effective Date and may be renewed for an
unlimited number of successive one-year terms upon mutual consent of the Parties. The Company will evaluate the performance of
the Advisor annually before renewing this Agreement, and each such renewal shall be for a term of no more than one year. Any such
renewal must be approved by the Independent Directors.

 

16. 
TERMINATION BY THE PARTIES. This Agreement may be terminated (i) immediately by the Company or the Operating Partnership for
Cause or upon the bankruptcy of the Advisor, (ii) upon 60 days written notice without Cause and without penalty by a majority of
the Independent Directors of the Company or (iii) upon 60 days written notice with Good Reason by the Advisor. The provisions of
Sections 17 through 30 survive termination of this Agreement.

 

17. 
ASSIGNMENT TO AN AFFILIATE. This Agreement may be assigned by the Advisor to an Affiliate with the majority approval of the
Board (including a majority of the Independent Directors). The Advisor may assign any rights to receive fees or other payments
under this Agreement to any Person without obtaining the approval of the Board. This Agreement shall not be assigned by the Company
or the Operating Partnership without the consent of the Advisor, except in the case of an assignment by the Company or the Operating
Partnership to a corporation, limited partnership or other organization which is a successor to all of the assets, rights and obligations
of the Company or the Operating Partnership, in which case such successor organization shall be bound hereunder and by the terms
of said assignment in the same manner as the Company and the Operating Partnership are bound by this Agreement.

 

18. 
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 or the Operating Partnership within 30 days after the effective date of such termination all unpaid
reimbursements of expenses and all earned but unpaid fees payable to the Advisor prior to termination of this Agreement, subject
to the 2%/25% Guidelines to the extent applicable.

 

(b)     The Advisor
shall promptly upon termination:

 

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

 

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

 

    12 

     

    

 

(iii)     deliver
to the Board all assets, including all Investments, and documents of the Company and the Operating Partnership then in the custody
of the Advisor; and

 

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

 

19.  INDEMNIFICATION
BY THE COMPANY AND THE OPERATING PARTNERSHIP. The Company and the Operating Partnership shall indemnify and hold harmless the
Advisor and its Affiliates, including their respective directors (the “Indemnitees,” and each an “Indemnitee”),
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, and to the extent that such indemnification would not be inconsistent with the laws of the State of Maryland, the
Articles of Incorporation or the provisions of Section II.G of the NASAA REIT Guidelines. In addition, the Company and the Operating
Partnership shall indemnify and hold harmless the officers of the Company and the Advisor and its Affiliates 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, and to
the extent that such indemnification would not be inconsistent with the laws of the State of Maryland or the Articles of Incorporation.
Notwithstanding the foregoing, the Company and the Operating Partnership shall not provide for indemnification of an Indemnitee
for any loss or liability suffered by such Indemnitee, nor shall they provide that an Indemnitee be held harmless for any loss
or liability suffered by the Company and the Operating Partnership, unless all of the following conditions are met:

 

		(a)	the Indemnitee has determined, in good faith, that the course of conduct
that caused the loss or liability was in the best interest of the Company and the Operating Partnership;

 

		(b)	the Indemnitee was acting on behalf of, or performing services for, the
Company or the Operating Partnership;

 

		(c)	such liability or loss was not the result of negligence or misconduct by
the Indemnitee; and

 

		(d)	such indemnification or agreement to hold harmless is recoverable only out
of the Company’s net assets and not from the Stockholders.

 

Notwithstanding
the foregoing, an Indemnitee shall not be indemnified by the Company and the Operating Partnership for any losses, liabilities
or expenses arising from or out of an alleged violation of federal or state securities laws by such Indemnitee unless one or more
of the following conditions are met:

 

		(a)	there has been a successful adjudication on the merits of each count involving
alleged securities law violations as to the Indemnitee;

 

		(b)	such claims have been dismissed with prejudice on the merits by a court
of competent jurisdiction as to the Indemnitee; or

 

		(c)	a court of competent jurisdiction approves a settlement of the claims against
the Indemnitee and finds that indemnification of the settlement and the related costs should be made, and the court considering
the request for indemnification has been advised of the position of the Securities and Exchange Commission and of the published
position of any state securities regulatory authority in which securities of the Company or the Operating Partnership were offered
or sold as to indemnification for violation of securities laws.

 

In addition, the
advancement of the Company’s or the Operating Partnership’s funds to an Indemnitee for legal expenses and other costs
incurred as a result of any legal action for which indemnification is being sought is permissible only if all of the following
conditions are satisfied:

 

		(a)	the legal action relates to acts or omissions with respect to the performance
of duties or services on behalf of the Company or the Operating Partnership;

 

		(b)	the legal action is initiated by a third party who is not a Stockholder
or the legal action is initiated by a stockholder acting in such stockholder’s capacity as such and a court of competent
jurisdiction specifically approves such advancement; and

 

		(c)	the Indemnitee undertakes to repay the advanced funds to the Company or
the Operating Partnership, together with the applicable legal rate of interest thereon, in cases in which such Indemnitee is found
not to be entitled to indemnification.

 

    13 

     

    

 

20. 
INDEMNIFICATION BY ADVISOR. The Advisor shall indemnify and hold harmless the Company and the Operating Partnership from contract
or other 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, misfeasance, intentional misconduct, negligence or reckless disregard of its duties; provided,
however, that the Advisor shall not be held responsible for any action of the Board in following or declining to follow any advice
or recommendation given by the Advisor.

 

21.  EXCLUSION OF CERTAIN TRANSACTIONS. In the event the Company or the Operating Partnership shall propose to enter into any transaction
in which a Director or an officer of the Company, and the Advisor, or any Affiliate of the Company, the Operating Partnership or
the Advisor has a direct or indirect interest, then such transaction shall be approved by a majority of the Board and also by a
majority of the Independent Directors.

 

22.  NON-SOLICITATION. During the period commencing on the Effective Date and ending one year following the Termination Date, the
Company shall not, without the Advisor’s prior written consent, directly or indirectly (i) solicit or encourage any person
to leave the employment or other service of the Advisor or its Affiliates; or (ii) hire on behalf of the Company or any other person
or entity, any person who has left its employment within the one year period following the termination of that person’s employment
the Advisor or its Affiliates. During the period commencing on the date hereof through and ending one year following the Termination
Date, the Company will not, whether for its own account or for the account of any other Person, intentionally interfere with the
relationship of the Advisor or its Affiliates with, or endeavor to entice away from the Advisor or its Affiliates, any person who
during the term of the Agreement is, or during the preceding one-year period, was a tenant, co-investor, co-developer, joint venturer
or other customer of the Advisor or its Affiliates.

 

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 required by the Articles of Incorporation, the Bylaws, or
accepted by the Party to whom it is given, and shall be given by being delivered by hand, by facsimile transmission, by courier
or overnight carrier or by registered or certified mail to the addresses set forth herein:

 

	To the Board and to the Company:	Moody National REIT II, Inc.
	 	6363 Woodway, Suite 110
	 	Houston, Texas 77057
	 	Facsimile: (713) 977-7505
	 	Attention: Brett C. Moody
	 	 
	with a copy to (which shall not constitute notice):	Alston & Bird LLP
	 	1201 West Peachtree Street
	 	Atlanta, GA 30309
	 	Attention: Rosemarie A. Thurston
	 	 
	To the Operating Partnership:	Moody National Operating Partnership II, LP
	 	 
	 	6363 Woodway, Suite 110
	 	Houston, Texas 77057
	 	Facsimile: (713) 977-7505
	 	Attention: Brett C. Moody
	 	 
	To the Advisor:	Moody National Advisor II, LLC
	 	 
	 	6363 Woodway, Suite 110
	 	Houston, Texas 77057 Facsimile:
	 	(713) 977-7505 Attention: Brett
	 	C. Moody

 

Any Party
may at any time give notice in writing to the other Parties 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 the Parties hereto, or their respective successors or assignees.

 

    14 

     

    

 

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. The provisions of this Agreement shall be construed and interpreted in accordance with the laws of the State
of Maryland.

 

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 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.

 

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.  EFFECTIVENESS OF PARTS OF THE AGREEMENT. Sections 9(a)(ii) and 9(c)(ii) shall not become effective until the Merger Effective
Time. If the Merger Agreement is terminated prior to the Merger Effective Time, Sections 9(a)(ii) and 9(c)(ii) shall automatically
be deemed revoked and void ab initio.

 

[Signatures on following
page.]

 

    15 

     

    

 

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

	 	 	 	 
	 	Moody National REIT II, Inc.
	 	 
	 	 	By: /s/ Brett C. Moody
	 	 	Brett C. Moody
	 	 	 
	 	 	Chief Executive Officer and President
	 	 	 	 
	 	Moody National Operating Partnership II, LP
	 	 
	 	By: Moody National REIT II, Inc.,
	 	its General Partner
	 	 	 	 
	 	 	By: /s/ Brett C. Moody
	 	 	Brett C. Moody
	 	 	 
	 	 	Chief Executive Officer and President
	 	 	 	 
	 	Moody National Advisor II, LLC
	 	 
	 	 	By: Moody National REIT Sponsor, LLC
	 	 	 
	 	 	 	By: Moody National REIT Sponsor SM, LLC
	 	 	 	 
	 	 	 	By: /s/ Brett C. Moody
	 	 	 	Brett C. Moody
	 	 	 	 
	 	 	 	Member

 

Signature Page to Second Amended and
Restated Advisory Agreement

 

    16 

     

    

 

SCHEDULE I

 

Merger Disposition Fee Allocation

 

	Asset	 	Share of Disposition Fee	 
	Homewood Suites Woodlands	 	$	316,839	 
	Hyatt Place Germantown	 	$	253,831	 
	Hyatt Place Charleston	 	$	234,029	 
	Hampton Inn Austin South	 	$	388,848	 
	Residence Inn Grapevine	 	$	444,655	 
	Courtyard Lyndhurst	 	$	657,081	 
	Hilton Garden Inn Austin	 	$	567,070	 
	Hampton Inn Great Valley	 	$	273,634	 
	Embassy Nashville	 	$	1,456,379	 
	Homewood Suites Austin	 	$	342,042	 
	Note receivable originated to Moody National DST Sponsor, LLC, aggregate principal amount of $9,000,000	 	$	162,020	 
	TownePlace Suites TCU	 	$	221,427	 
	Hampton Inn Energy Corridor	 	$	181,822	 
	Note receivable originated to Moody National Realty Company, L.P., aggregate principal amount of $4,500,000	 	$	81,010	 
	Total	 	$	5,580,685	 

 

    17Moody National REIT II, Inc. 8-K

Exhibit 10.2

 

SECOND AMENDED AND RESTATED LIMITED PARTNERSHIP
AGREEMENT

 

OF

 

MOODY NATIONAL OPERATING PARTNERSHIP
II, LP

 

A DELAWARE LIMITED PARTNERSHIP

 

June 12, 2017

 

     

     

    

 

TABLE OF CONTENTS

 

	 	 	Page
	 	 	 
	Article 1          DEFINED TERMS	 	2
	 	 	 
	Article 2          PARTNERSHIP FORMATION AND IDENTIFICATION	 	13
	 	 	 
	2.1          Formation	 	13
	2.2          Name, Office and Registered Agent	 	13
	2.3          Term and Dissolution	 	13
	2.4          Filing of Certificate and Perfection of Limited Partnership	 	14
	 	 	 
	Article 3          BUSINESS OF THE PARTNERSHIP	 	14
	 	 	 
	Article 4          CAPITAL CONTRIBUTIONS AND ACCOUNTS	 	15
	 	 	 
	4.1          Capital Contributions	 	15
	4.2          Class A Units, Class D Units, Class I Units and Class T Units	 	15
	4.3          Additional Capital Contributions and Issuances of Additional Partnership Units	 	15
	4.4          Additional Funding	 	17
	4.5          Capital Accounts	 	18
	4.6          No Interest on Contributions	 	18
	4.7          Return of Capital Contributions	 	18
	4.8          No Third-Party Beneficiary	 	19
	4.9          Redemption of REIT Shares	 	19
	4.10        Exchanges	 	19
	 	 	 
	Article 5          PROFITS AND LOSSES; DISTRIBUTIONS	 	19
	 	 	 
	5.1          Allocation of Profit and Loss	 	19
	5.2          Distribution of Cash	 	22
	5.3          REIT Distribution Requirements	 	24
	5.4          No Right to Distributions in Kind	 	24
	5.5          Limitations on Return of Capital Contributions	 	24
	5.6          Distributions upon Liquidation	 	24
	5.7          Substantial Economic Effect	 	25
	 	 	 
	Article 6          RIGHTS, OBLIGATIONS AND POWERS OF THE GENERAL PARTNER	 	25
	 	 	 
	6.1          Management of the Partnership	 	25
	6.2          Delegation of Authority	 	27
	6.3          Indemnification and Exculpation of Indemnitees	 	28
	6.4          Liability of the General Partner	 	29
	6.5          Reimbursement of General Partner	 	30
	6.6          Outside Activities	 	31
	6.7          Employment or Retention of Affiliates	 	31
	6.8          Title to Partnership Assets	 	31
	 	 	 
	Article 7          CHANGES IN GENERAL PARTNER	 	32
	 	 	 
	7.1          Transfer of the General Partner’s Partnership Units	 	32
	7.2          Admission of a Substitute or Additional General Partner	 	34

 

    i 

     

    

 

	7.3          Effect of Bankruptcy, Withdrawal, Death or Dissolution of a General Partner	 	34
	7.4          Removal of a General Partner	 	35
	 	 	 
	Article 8          RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS	 	36
	 	 	 
	8.1          Management of the Partnership	 	36
	8.2          Power of Attorney	 	36
	8.3          Limitation on Liability of Limited Partners	 	36
	8.4          Redemption of Special Limited Partnership Interests	 	37
	8.5          Redemption Right	 	38
	 	 	 
	Article 9          TRANSFERS OF LIMITED PARTNERSHIP INTERESTS AND SPECIAL LIMITED PARTNERSHIP INTERESTS	 	40
	 	 	 
	9.1          Restrictions on Transfer of Limited Partnership Interests	 	40
	9.2          Admission of Substitute Limited Partner	 	41
	9.3          Rights of Assignees of Partnership Units	 	42
	9.4          Effect of Bankruptcy, Death, Incompetence or Termination of a Limited Partner	 	42
	9.5          Purchase for Investment	 	42
	 	 	 
	Article 10          BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS	 	43
	 	 	 
	10.1          Books and Records	 	43
	10.2          Custody of Partnership Funds; Bank Accounts	 	43
	10.3          Fiscal and Taxable Year	 	43
	10.4          Annual Tax Information and Report	 	43
	10.5          Tax Matters Partner; Partnership Representative; Tax Elections; Special Basis Adjustments	 	44
	 	 	 
	Article 11          ARTICLE 11 AMENDMENT OF AGREEMENT	 	44
	 	 	 
	Article 12          ARTICLE 12 GENERAL PROVISIONS	 	45
	 	 	 
	12.1          Notices	 	45
	12.2          Survival of Rights	 	45
	12.3          Additional Documents	 	45
	12.4          Severability	 	45
	12.5          Entire Agreement	 	45
	12.6          Pronouns and Plurals	 	45
	12.7          Headings	 	46
	12.8          Counterparts	 	46
	12.9          Governing Law	 	46
	 	 	 
	EXHIBIT A:         CONTRIBUTIONS & INTEREST	 	A-1
	EXHIBIT B:         NOTICE OF EXERCISE OF REDEMPTION
RIGHT	 	B-2

 

    ii 

     

    

 

SECOND AMENDED AND RESTATED LIMITED PARTNERSHIP
AGREEMENT

 

OF

 

MOODY NATIONAL OPERATING PARTNERSHIP
II, LP

 

This Second Amended
and Restated Limited Partnership Agreement is entered into this 12th day of June, 2017, between Moody National REIT II, Inc., a
Maryland corporation, as the General Partner, and the Limited Partners set forth on Exhibit A attached hereto. Capitalized
terms used herein but not otherwise defined shall have the meanings given to them in Article 1.

 

AGREEMENT

 

WHEREAS, the General
Partner intends to qualify as a real estate investment trust under the Internal Revenue Code of 1986, as amended;

 

WHEREAS, Moody National
Operating Partnership II, LP was formed on July 29, 2014 as a limited partnership under the laws of the State of Delaware, pursuant
to a Certificate of Limited Partnership filed with the Office of the Secretary of State of the State of Delaware on July 29, 2014;

 

WHEREAS, the General
Partner desires to conduct its current and future business through the Partnership;

 

WHEREAS, the Partnership
was previously governed by that certain Limited Partnership Agreement of the Partnership, dated as of August 15, 2014 (the “Original
Agreement”) and the Original Agreement was amended and restated by that certain Amended and Restated Limited Partnership
Agreement dated May 20, 2016 (the “First Amended Agreement”);

 

WHEREAS, the General
Partner reclassified its common stock, re-designating its outstanding common stock as Class A Common Stock and reclassifying its
authorized and unissued shares of common stock into Class A Common Stock, Class D Common Stock, Class I Common Stock and Class
T Common Stock;

 

WHEREAS, the General
Partner wishes to amend and restate the First Amended Agreement to reflect the General Partner’s offering of several classes
of its common stock by creating corresponding classes of Partnership Units as required by Section 4.2(c) of the First Amended Agreement,
and re-designating the Units outstanding under the First Amended Agreement as Class A Units.

 

     1

     

    

 

NOW, THEREFORE, in
consideration of the foregoing, of mutual covenants between the parties hereto, and of other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

Article
1  

DEFINED TERMS

 

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

 

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

 

“Additional
Funds” has the meaning set forth in Section 4.4.

 

“Adjusted
Capital Account” means, with respect any Partner, the Capital Account of such Partner as of the end of each Partnership
taxable year or other allocation period (i) increased by any amounts which such Partner is obligated to restore pursuant to any
provision of this Agreement or is deemed to be obligated to restore pursuant to Regulations Section 1.704-1(b)(2)(ii)(c) and the
penultimate sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(g)(5) and (ii) decreased by the items described in Regulations
Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) and 1.704-1(b)(2)(ii)(d)(6). The foregoing definition of Adjusted Capital
Account is intended to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently
therewith.

 

“Adjusted
Capital Account Deficit” means, with respect to any Partner, the deficit balance, if any, in such Partner’s Adjusted
Capital Account as of the end of the relevant Partnership taxable year or other allocation period.

 

“Administrative
Expenses” means (i) all administrative and operating costs and expenses incurred by the Partnership, (ii) those administrative
costs and expenses of the General Partner, including any salaries or other payments to directors, officers or employees of the
General Partner, and any accounting and legal expenses of the General Partner, which expenses, the Partners have agreed, are expenses
of the Partnership and not the General Partner, and (iii) to the extent not included in clause (ii) above, REIT Expenses; provided,
however, that Administrative Expenses shall not include any administrative costs and expenses incurred by the General Partner that
are attributable to a Property or partnership interests in a Subsidiary Partnership that are owned by the General Partner directly.

 

“Advisor”
or “Advisors” means the Person or Persons, if any, appointed, employed or contracted by the General Partner
and responsible for directing or performing the day-to-day business affairs of the General Partner, including any Person to whom
such Advisor subcontracts substantially all of such functions.

 

“Advisory
Agreement” means the agreement between the General Partner, the Advisor and the partnership pursuant to which the Advisor
will direct or perform the day-to-day business affairs of the General Partner.

 

     2

     

    

 

“Affiliate”
means, with respect to any Person, (i) any Person directly or indirectly, owning, controlling or holding with the power to vote
10% or more of the outstanding voting securities of such other Person; (ii) any Person 10% or more of whose outstanding voting
securities are directly or indirectly owned, controlled or held, with the 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; and (v) any legal entity for which such Person acts an executive officer, director,
trustee or general partner.

 

“Aggregate
Share Ownership Limit” has the meaning provided in the Articles of Incorporation.

 

“Agreement”
means this Amended and Restated Limited Partnership Agreement, as amended, modified supplemented or restated from time to time,
as the context requires.

 

“Applicable
Percentage” has the meaning provided in Section 8.5(b) hereof.

 

“Articles
of Incorporation” means the Articles of Incorporation of the General Partner, as amended or restated from time to time,
as filed with the Maryland State Department of Assessments and Taxation.

 

“Capital Account”
has the meaning provided in Section 4.5 hereof.

 

“Capital Contribution”
means, with respect to any Partner, any cash, cash equivalents or the fair market value of other property which such Partner contributes
or is deemed to contribute to the Partnership pursuant to Section 4.1 or 4.3 hereof. Any reference to the Capital Contribution
of a Partner shall include the Capital Contribution made by a predecessor holder of the Partnership Interests of such Partner.

 

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

 

(i)          The initial Carrying Value of any asset contributed to the Partnership shall be the gross fair market value of such asset,
as agreed by the Contributing Partner and the General Partner.

 

(ii)         The Carrying Values of all Partnership assets shall be adjusted to equal their respective gross fair market values, as determined
by the General Partner using such reasonable method of valuation as it may adopt immediately prior to the following events:

 

(a)         the acquisition of an additional interest in the Partnership by any new or existing Partner in exchange for more than a
de minimis Capital Contribution or the provision of services to or for the benefit of the Partnership, if the General Partner reasonably
determines that such adjustment is necessary or appropriate to reflect the relative economic interests of the Partners in the Partnership;

 

(b)         the
distribution by the Partnership to a Partner of more than a de minimis amount of property as consideration for an interest in
the Partnership, if the General Partner reasonably determines that such adjustment is necessary or appropriate to reflect the
relative economic interests of the Partners in the Partnership;

 

     3

     

    

 

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

 

(d)         the
grant of an interest in the Partnership (other than a de minimis interest) as consideration for the provision of services to or
for the benefit of the Partnership by an existing Partner acting in a partner capacity, or by a new Partner acting in a partner
capacity or in anticipation of becoming a Partner of the Partnership, if the General Partner reasonably determines that such adjustment
is necessary or appropriate to reflect the relative economic interests of the Partners in the Partnership; and

 

(e)         at such other times as the General Partner shall reasonably deem necessary or advisable if permitted by, or required to
comply with, Regulations Sections 1.704-1(b) and 1.704-2.

 

(iii)        The
Carrying Value of a Partnership asset distributed to a Partner shall be the gross fair market value of such asset on the date
of distribution, as agreed by the distributee and the General Partner.

 

(iv)        The Carrying Values of Partnership assets shall be adjusted to reflect any adjustments to the adjusted basis of such assets
pursuant to Code Section 734(b) or 743(b), but only to the extent that such adjustments are taken into account in determining Capital
Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m); provided, however, that Carrying Values shall not be adjusted pursuant
to this clause (iv) to the extent that the General Partner reasonably determines that an adjustment pursuant to clause (ii) above
is necessary or appropriate in connection with a transaction that would otherwise result in an adjustment pursuant to this clause
(iv).

 

(v)         If the Carrying Values of a Partnership asset has been determined or adjusted pursuant to clause (i), (ii), or (iv) above,
such Carrying Values shall thereafter be adjusted by Depreciation.

 

“Cash Amount”
means an amount of cash equal to the lesser of (i) the Value of the REIT Shares Amount on the date of receipt by the General Partner
of a Notice of Redemption or (ii) the applicable Redemption Price determined by the General Partner.

 

“Certificate”
means any instrument or document that is required under the laws of the State of Delaware, or any other jurisdiction in which the
Partnership conducts business, to be signed and sworn to by the Partners of the Partnership (either by themselves or pursuant to
the power-of-attorney granted to the General Partner in Section 8.2 hereof) and filed for recording in the appropriate public offices
within the State of Delaware or such other jurisdiction to perfect or maintain the Partnership as a limited partnership, to effect
the admission, withdrawal, or substitution of any Partner of the Partnership, or to protect the limited liability of the Limited
Partners as limited partners under the laws of the State of Delaware or such other jurisdiction.

 

“Class”
means a class of REIT Shares or Partnership Units, as the context may require.

 

     4

     

    

 

“Class A REIT
Shares” means the REIT Shares referred to as “Class A Common Stock” in the Articles of Incorporation.

 

“Class A Unit”
means a Partnership Unit entitling the holder thereof to the rights of a holder of a Class A Unit as provided in this Agreement.

 

“Class D REIT
Shares” means the REIT Shares referred to as “Class D Common Stock” in the Articles of Incorporation.

 

“Class D Unit”
means a Partnership Unit entitling the holder thereof to the rights of a holder of a Class D Unit as provided in this Agreement.

 

“Class I REIT
Shares” means the REIT Shares referred to as “Class I Common Stock” in the Articles of Incorporation.

 

“Class I Unit”
means a Partnership Unit entitling the holder thereof to the rights of a holder of a Class I Unit as provided in this Agreement.

 

“Class T REIT
Shares” means the REIT Shares referred to as “Class T Common Stock” in the Articles of Incorporation.

 

“Class T Unit”
means a Partnership Unit entitling the holder thereof to the rights of a holder of a Class T Unit as provided in this Agreement.

 

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

 

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

 

“Common Share
Ownership Limit” has the meaning provided in the Articles of Incorporation.

 

“Common Unit”
means a fractional, undivided share of the Partnership Interests of all Partners issued pursuant to Article 4 hereof, but does
not include, unless otherwise provided herein for specific purposes, any Preferred Unit, Special Limited Partnership Unit, or any
other Partnership Unit specified in a Partnership Unit Designation as being other than a Common Unit; provided, however, that the
General Partner Interest and the Limited Partner Interests shall have the differences in rights and privileges as specified in
this Agreement.

 

“Defaulting
Limited Partner” has the meaning provided in Section 5.2(c) of this Agreement.

 

     5

     

    

 

“Depreciation”
means, for each fiscal year, an amount equal to the federal income tax depreciation, amortization, or other cost recovery deduction
allowable with respect to an asset for such year, except that if the Carrying Value of an asset differs from its adjusted basis
for federal income tax purposes at the beginning of such year or other period, Depreciation shall be an amount which bears the
same ratio to such beginning Carrying Value as the federal income tax depreciation, amortization, or other cost recovery deduction
for such year bears to such beginning adjusted tax basis; provided, however, that if the federal income tax depreciation, amortization,
or other cost recovery deduction for such year is zero, Depreciation shall be determined with reference to such beginning Carrying
Value using any reasonable method selected by the General Partner.

 

“Director”
means a member of the board of directors of the General Partner.

 

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

 

“Excepted
Holder Limit” has the meaning provided in the Articles of Incorporation.

 

“First Amended
Agreement” has the meaning provided in the Recitals.

 

“General Partner”
means Moody National REIT II, Inc. and any Person who becomes a substitute or additional General Partner as provided herein, and
any of their successors as General Partner, until such Person ceases to be a General Partner pursuant to the terms of this Agreement.

 

“General Partnership
Interest” means a Partnership Interest held by the General Partner that is a general partnership interest.

 

“General Partner
Loan” has the meaning provided in Section 5.2(c) of this Agreement.

 

“Indemnitee”
means (i) any Person made a party to a proceeding by reason of its status as the General Partner or a director, officer or employee
of the General Partner or the Partnership, and (ii) such other Persons (including Affiliates of the General Partner or the Partnership)
as the General Partner may designate from time to time, in its sole and absolute discretion.

 

     6

     

    

 

“Independent
Director” means a Director who is not on the date of determination, and within the last two years from the date of determination
has not been, directly or indirectly associated with the Sponsor of the General Partner or the Advisor by virtue of (i) ownership
of an interest in the Sponsor, the Advisor or any of their Affiliates, other than the General Partner, (ii) employment by the Sponsor,
the Advisor or any of their Affiliates, (iii) service as an officer or director of the Sponsor, the Advisor or any of their Affiliates,
other than as a Director, (iv) performance of services, other than as a Director, for the General Partner, (v) service as a director
or trustee of more than three real estate investment trusts organized by the Sponsor or advised by the Advisor or (vi) maintenance
of a material business or professional relationship with the Sponsor, the Advisor or any of their Affiliates. A business or professional
relationship is considered “material” if the aggregate gross revenue derived by the Director from the Sponsor,
the Advisor and their Affiliates (excluding fees for serving as an independent director of the General Partner or other real estate
investment trust or real estate program organized or advised or managed by the Sponsor or its Affiliates) exceeds five percent
of either the Director’s annual gross revenue during either of the last two years or the Director’s net worth on a
fair market value basis. An indirect association with the Sponsor or the Advisor shall include circumstances in which a Director’s
spouse, parent, child, sibling, mother- or father-in-law, son- or daughter-in-law or brother- or sister-in-law is or has been associated
with the Sponsor, the Advisor, any of their Affiliates or the General Partner.

 

“Junior Share”
means a share of capital stock of the General Partner now or hereafter authorized or reclassified that has dividend rights, or
rights upon liquidation, winding up and dissolution, that are inferior or junior to the REIT Shares.

 

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

 

“Limited Partnership
Interest” means the ownership interest of a Limited Partner in the Partnership at any particular time, including the
right of such Limited Partner to any and all benefits to which such Limited Partner may be entitled as provided in this Agreement
and in the Act, together with the obligations of such Limited Partner to comply with all the provisions of this Agreement and of
such Act. A Limited Partnership Interest may be expressed as a number of Common Units, Preferred Units or other Partnership Units.

 

“Listing”
means the listing of the REIT Shares on a national securities exchange or the receipt by holders of the REIT Shares of securities
that are listed on a national securities exchange in exchange for REIT Shares. Upon such Listing, the shares shall be deemed “Listed.”

 

“New Securities”
means (i) any rights, options, warrants, or convertible or exchangeable securities having the right to subscribe for or purchase
REIT Shares or Preferred Shares, excluding Preferred Shares and Junior Shares or (ii) any debt issued by the General Partner that
provides any of the rights described in (i).

 

“Nonrecourse
Deduction” has the meaning set forth in Regulations Section 1.704-2(b)(1), and the amount of Nonrecourse Deductions for
a Partnership Year shall be determined in accordance with the rules of Regulations Section 1.704-2(c).

 

“Nonrecourse
Liability” has the meaning provided in Regulations Section 1.704(b)(3).

 

     7

     

    

 

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

 

“Offer”
has the meaning provided in Section 7.1(b) of this Agreement.

 

“Original
Agreement” has the meaning set forth in the recitals hereto.

 

“Partner”
means any General Partner or Limited Partner.

 

“Partner Minimum
Gain” means an amount, with respect to each Partner Nonrecourse Debt, equal to the Partnership Minimum Gain that would
result if such Partner Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with Regulations Section
1.704-2(i)(3).

 

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

 

“Partner Nonrecourse
Debt Minimum Gain” means an amount, with respect to each Partner Nonrecourse Debt, equal to the Partnership Minimum Gain
that would result if such Partner Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with Regulations
Section 1.704-2(i)(3).

 

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

 

“Partnership”
means Moody National Operating Partnership II, LP, a Delaware limited partnership.

 

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

 

“Partnership
Loan” has the meaning provided in Section 5.2(c) of this Agreement.

 

“Partnership
Minimum Gain” has the meaning provided in Regulations Sections 1.704-2(b)(2) and 1.704-2(d), and the amount of Partnership
Minimum Gain, as well as any net increase or decrease in Partnership Minimum Gain, for a Partnership Year shall be determined in
accordance with the rules of Regulations Section 1.704-2(d).

 

“Partnership
Record Date” means the record date established by the General Partner for the distribution of cash pursuant to Section
5.2 hereof.

 

     8

     

    

 

“Partnership
Representative” has the meaning provided in Section 6223 of the Code.

 

“Partnership
Unit” means a Common Unit, a Preferred Unit, a Special Limited Partnership Unit or any other unit of a fractional, undivided
share of the Partnership Interests that the General Partner has authorized pursuant to Article 4 hereof; provided, however, that
Partnership Units comprising a General Partner Interest or a Limited Partner Interest shall have the differences in rights and
privileges as specified in this Agreement.

 

“Partnership
Year” shall mean the Partnership’s taxable year or any shorter period for which Partnership profits and losses
are allocated.

 

“Percentage
Interest” means, with respect to any Partner other than a Special Limited Partner at any time, the percentage determined
by dividing the Common Units of such Partner by the sum of the Common Units of all Partners (other than Special Limited Partners).

 

“Person”
means any individual, partnership, limited liability company, corporation, joint venture, trust or other entity.

 

“Preferred
Shares” means a share of capital stock of the General Partner now or hereafter authorized or reclassified that has dividend
rights, or rights upon liquidation, winding up and dissolution, that are superior or prior to REIT Shares.

 

“Preferred
Unit” means a fractional, undivided share of the Partnership Interests that has distribution rights, or rights upon liquidation,
winding up and dissolution, that are superior or prior to the Common Units that the General Partner has authorized pursuant to
Section 4.3 hereof.

 

“Profit”
and “Loss” means, for each Partnership Year or other applicable period, an amount equal to the Partnership’s
taxable income or loss for such Partnership Year, determined in accordance with Code Section 703(a) (for this purpose, all items
of income, gain, loss, or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable
income or loss), with the following adjustments:

 

(i)            Any income of the Partnership that is exempt from federal income tax and not otherwise taken into account in computing Profit
and Loss pursuant to this definition of “Profit” and “Loss” shall be added to such taxable
income or loss;

 

(ii)           Any expenditures of the Partnership described in Code Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures
pursuant to Regulations Section 1.704-1(b)(2)(iv)(i) and not otherwise taken into account in computing Profit or Loss pursuant
to this definition of “Profit” and “Loss” shall be subtracted from such taxable income or
loss;

 

(iii)          In the event the Carrying Value of any Partnership asset is adjusted pursuant to subparagraphs (ii) or (iii) of the definition
of Carrying Value, the amount of such adjustment shall be taken into account as gain or loss from the disposition of such asset
for purposes of computing Profit and Loss;

 

     9

     

    

 

(iv)         Gain or loss resulting from any disposition of Partnership Property with respect to which gain or loss is recognized for
federal income tax purposes shall be computed by reference to the Carrying Value of the property disposed of, notwithstanding that
the adjusted tax basis of such property differs from its Carrying Value;

 

(v)          In lieu of the depreciation, amortization, and other cost recovery deductions taken into account in computing such taxable
income or loss, there shall be taken into account Depreciation for such Partnership Year or other period;

 

(vi)         To the extent an adjustment to the adjusted tax basis of any Partnership asset pursuant to Code Section 734(b) or Section
743(b) is required pursuant to Regulations Section 1.704-1(b)(2)(iv) to be taken into account in determining Capital Accounts as
a result of a distribution other than in liquidation of a Partner’s interest in the Partnership, the amount of such adjustment
shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the
basis of the asset) from the disposition of the asset and shall be taken into account for purposes of computing Profit or Loss;
and

 

(vii)        Notwithstanding any other provision of this definition of “Profit” and “Loss”, any
items that are specially allocated pursuant to Section 5.1(a), 5.1(c), or 5.1(d) hereof shall not be taken into account in computing
Profits or Losses. The amounts of the items of Partnership income, gain, loss, or deduction available to be specially allocated
pursuant to Sections 5.1(a), 5.1(c) and 5.1(d) hereof shall be determined by applying rules analogous to those set forth in subparagraphs
(i) through (vi) above.

 

“Property”
means any Real Estate Asset or other investment in which the Partnership holds an ownership interest.

 

“Prospectus”
means the prospectus included in the most recent effective registration statement filed by the General Partner with the Commission
with respect to the offering of REIT Shares, as such prospectus may be amended or supplemented from time to time.

 

“Real Estate
Asset” means unimproved and improved real property, real estate related assets and any direct or indirect interest therein,
including, without limitation, fee or leasehold interests, options, leases, partnership and joint venture interests, equity and
debt securities of entities that own real estate, loans secured by real property including first or second mortgage loans, mezzanine
loans and participations in such loans, preferred equity interests secured by a property owner’s interest in real property
and other contractual rights in real estate.

 

“Redemption
Price” means the Value of the REIT Shares Amount on the date of receipt by the General Partner of a Notice of Redemption
multiplied by any discount determined by the General Partner, including, but not limited to, any discount based upon the combined
number of years that the applicable Partner has held the Partnership Units offered for redemption.

 

“Redemption
Right” has the meaning provided in Section 8.5(a) of this Agreement.

 

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

 

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

 

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

 

“REIT Share”
means a share of common stock in the General Partner (or successor entity, as the case may be), including Class A REIT Shares,
Class D REIT Shares, Class I REIT Shares, and Class T REIT Shares.

 

“REIT Shares
Amount” means a number of REIT Shares having the same Class designation as the class of Partnership Units offered for
exchange by a Tendering Party equal to the number of Partnership Units offered for exchange by a Tendering Party; provided that
in the event the General Partner issues to all holders of REIT Shares rights, options, warrants or convertible or exchangeable
securities entitling the stockholders to subscribe for or purchase REIT Shares, or any other securities or property (collectively,
the “rights”), and the rights have not expired at the Specified Redemption Date, then the REIT Shares Amount
shall also include the rights issuable to a holder of the REIT Shares Amount of REIT Shares on the record date fixed for purposes
of determining the holders of REIT Shares entitled to rights.

 

“Related Party”
means, with respect to any Person, any other Person whose ownership of shares of the General Partner’s capital stock would
be attributed to the first such Person under Code Section 544 (as modified by Code Section 856(h)(1)(B)).

 

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“Restriction
Notice” has the meaning provided in Section 8.5(e) of this Agreement.

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

“Special Limited
Partner” means the holder of a Special Limited Partnership Unit.

 

“Special Limited
Partnership Unit” means Partnership Units designated as Special Limited Partnership Units issued pursuant to Section
4.3(e) with the rights and obligations provided under this Agreement.

 

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

 

“Sponsor”
means any Person which (a) is directly or indirectly instrumental in organizing, wholly or in part, the General Partner, (b) will
control, manage or participate in the management of the General Partner, and any Affiliate of any such Person, (c) takes the initiative,
directly or indirectly, in founding or organizing the General Partner, either alone or in conjunction with one or more other Persons,
(d) receives a material participation in the General Partner in connection with the founding or organizing of the business of the
General Partner, in consideration of services or property, or both services and property, (e) has a substantial number of relationships
and contacts with the General Partner, (f) possesses significant rights to control Properties, (g) receives fees for providing
services to the General Partner which are paid on a basis that is not customary in the industry or (h) provides goods or services
to the General Partner on a basis which was not negotiated at arm’s-length with the General Partner. “Sponsor”
does not include any Person whose only relationship with the General Partner is that of an independent property manager and whose
only compensation is as such, or wholly independent third parties such as attorney, accountants and underwriters whose only compensation
is for professional services.

 

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

 

“Subsidiary
Partnership” means any partnership of which the partnership interests therein are owned by the General Partner or a direct
or indirect subsidiary of the General Partner.

 

“Substitute
Limited Partner” means any Person admitted to the Partnership as a Limited Partner pursuant to Section 9.2 hereof.

 

“Successor
Entity” has the meaning provided in Section 4.3(b).

 

“Survivor”
has the meaning provided in Section 7.1(d).

 

“Tax Matters
Partner” has the meaning provided in Section 6231(a)(7) of the Code.

 

“Tendered
Units” has the meaning provided in Section 8.5(b) of this Agreement.

 

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“Tendering
Party” has the meaning provided in Section 8.5(a) of this Agreement.

 

“Termination
Event” means the termination or nonrenewal of the Advisory Agreement (i) in connection with a merger, sale of assets
or transaction involving the General Partner pursuant to which a majority of the Directors then in office are replaced or removed,
(ii) by the Advisor for “good reason” (as defined in the Advisory Agreement) or (iii) by the General Partner
other than for “cause” (as defined in the Advisory Agreement).

 

“Transfer”
has the meaning provided in Section 9.2(a) hereof.

 

“Value”
means the fair market value per share of REIT Shares which will equal: (i) if REIT Shares are Listed, the average closing price
per share for the previous thirty (30) business days, (ii) if REIT Shares are not Listed, the most recent offering price per share
or share equivalent of REIT Shares, until December 31st of the year following the year in which the most recently completed offering
of REIT Shares has expired, and (iii) thereafter, such price per REIT Share as the management of the General Partner determines
in good faith.

 

Article
2  

PARTNERSHIP FORMATION AND IDENTIFICATION

 

		2.1	Formation.

 

The Partnership was
formed as a limited partnership pursuant to the Act, and all other pertinent laws of the State of Delaware, for the purposes and
upon the terms and conditions set forth in this Agreement.

 

		2.2	Name, Office and Registered Agent.

 

The name of the Partnership
is Moody National Operating Partnership II, LP. The specified office and place of business of the Partnership shall be 6363 Woodway
Drive, Suite 110, Houston, Texas 77057. The General Partner may at any time change the location of such office, provided the General
Partner gives notice to the Partners of any such change. The name and address of the Partnership’s registered agent is Corporation
Service Company, 2711 Centerville Road, Suite 400, Wilmington, New Castle County, Delaware 19801. The sole duty of the registered
agent as such is to forward to the Partnership any notice that is served on him as registered agent.

 

		2.3	Term and Dissolution.

 

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

 

(i)          the occurrence of an Event of Bankruptcy as to a General Partner or the dissolution, death, removal or withdrawal of a General
Partner unless the business of the Partnership is continued pursuant to Section 7.3(b) hereof; provided that if a General Partner
is on the date of such occurrence a partnership, the dissolution of such General Partner as a result of the dissolution, death,
withdrawal, removal or Event of Bankruptcy of a partner in such partnership shall not be an event of dissolution of the Partnership
if the business of such General Partner is continued by the remaining partner or partners, either alone or with additional partners,
and such General Partner and such partners comply with any other applicable requirements of this Agreement;

 

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

 

(iii)        the election by the General Partner that the Partnership should be dissolved.

 

(b)         Upon dissolution of the Partnership (unless the business of the Partnership is continued pursuant to Section 7.3(b) hereof),
the General Partner (or its trustee, receiver, successor or legal representative) shall amend or cancel any Certificate(s) and
liquidate the Partnership’s assets and apply and distribute the proceeds thereof in accordance with Section 5.6 hereof. Notwithstanding
the foregoing, the liquidating General Partner may either (i) defer liquidation of, or withhold from distribution for a reasonable
time, any assets of the Partnership (including those necessary to satisfy the Partnership’s debts and obligations), or (ii)
distribute the assets to the Partners in kind.

 

		2.4	Filing of Certificate and Perfection of Limited Partnership.

 

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

 

Article
3  

BUSINESS OF THE PARTNERSHIP

 

The purpose and nature
of the business to be conducted by the Partnership is (i) to conduct any business that may be lawfully conducted by a limited partnership
organized pursuant to the Act, provided, however, that such business shall be limited to and conducted in such a manner as to permit
the General Partner at all times to qualify as a REIT, unless the General Partner determines that it no longer intends to qualify
as a REIT, and in a manner such that the General Partner will not be subject to any taxes under Section 857 or 4981 of the Code,
(ii) to enter into any partnership, joint venture or other similar arrangement to engage in any of the foregoing or the ownership
of interests in any entity engaged in any of the foregoing and (iii) to do anything necessary or incidental to the foregoing. In
connection with the foregoing, and without limiting the General Partner’s right in its sole and absolute discretion to qualify
or cease qualifying as a REIT, the Partners acknowledge that the General Partner intends to qualify as a REIT for federal income
tax purposes and that such qualification and the avoidance of income and excise taxes on the General Partner inures to the benefit
of all the Partners and not solely to the General Partner. Notwithstanding the foregoing, the Limited Partners agree that the General
Partner may terminate its status as a REIT under the Code at any time to the full extent permitted under the Articles of Incorporation.
The General Partner on behalf of the Partnership shall also be empowered to do any and all acts and things necessary or prudent
to ensure that the Partnership will not be classified as a “publicly traded partnership” under Section 7704
of the Code.

 

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Article
4  

CAPITAL CONTRIBUTIONS AND ACCOUNTS

 

		4.1	Capital Contributions.

 

The Capital Contributions
and Partnership Units of each Partner are set forth on Exhibit A, as the same shall be amended from time to time by the General
Partner to the extent necessary to reflect accurately sales, exchanges or other Transfers, redemptions, Capital Contributions,
the issuance of additional Partnership Units, or similar events having an effect on a Partner’s ownership of Partnership
Units.

 

		4.2	Class A Units, Class D Units, Class I Units and Class T Units.

 

The General Partner
is hereby authorized to cause the Partnership to issue Partnership Units designated as Class A Units, Class D Units, Class I Units
and Class T Units. Each such Class shall have the rights and obligations attributed to that Class under this Agreement. All Common
Units outstanding on the date hereof are re-designated as Class A Units.

 

		4.3	Additional Capital Contributions and Issuances of Additional Partnership Units.

 

Except as provided
in this Section 4.3 or in Section 4.4, the Partners shall have no right or obligation to make any additional Capital Contributions
or loans to the Partnership.

 

(a)           The General Partner is hereby authorized to cause the Partnership to issue additional Partnership Units for any Partnership
purpose at any time or from time to time, including but not limited to Partnership Units issued in connection with acquisitions
of properties, to the Partners (including the General Partner) or to other Persons for such consideration and on such terms and
conditions as shall be established by the General Partner in its sole and absolute discretion, all without the approval of any
Limited Partner. Any additional Partnership Units issued thereby may be issued in one or more classes (including the Classes specified
in this Agreement or any other Classes), or one or more series of any of such classes, with such designations, preferences and
relative, participating, optional or other special rights, powers and duties, all as shall be determined by the General Partner
in its sole and absolute discretion and without the approval of any Limited Partner, subject to Delaware law, including, without
limitation, (i) the allocations of items of Partnership income, gain, loss, deduction and credit to each such class or series of
Partnership Units; (ii) the right of each such class or series of Partnership Units to share in Partnership distributions; and
(iii) the rights of each such class or series of Partnership Units upon dissolution and liquidation of the Partnership. Without
limiting the foregoing, the General Partner is expressly authorized to cause the Partnership to issue Partnership Units for less
than fair market value, so long as the General Partner concludes in good faith that such issuance is in the best interests of the
General Partner and the Partnership. In the event that the Partnership issues additional Partnership Units pursuant to this Section
4.3(a), the General Partner shall make such revisions to this Agreement as it deems necessary to reflect the issuance of such additional
Partnership Units.

 

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(b)           In the event the General Partner (i) declares or pays a dividend on any Class of its outstanding REIT Shares in REIT Shares
or makes a distribution to all holders of any Class of its outstanding REIT Shares in REIT Shares, (ii) subdivides any Class of
its outstanding REIT shares, or (iii) combines any Class of its outstanding REIT Shares into a smaller number of REIT Shares with
respect to any Class of REIT Shares, then a corresponding adjustment to the number of outstanding Partnership Units of the applicable
Class necessary to maintain the proportionate relationship between the number of outstanding Partnership Units of such Class to
the number of outstanding REIT Shares of such Class shall automatically be made. Additionally, in the event that any other entity
shall become General Partner pursuant to any merger, consolidation or combination of the General Partner with or into another entity
(the “Successor Entity”), the number of outstanding Partnership Units of each class shall be adjusted by multiplying
such number by the number of shares of the Successor Entity into which one REIT Share of such Class is converted pursuant to such
merger, consolidation or combination, determined as of the date of such merger, consolidation or combination. Any adjustment to
the number of outstanding Partnership Units of any Class shall become effective immediately after the effective date of such event
retroactive to the record date, if any, for such event; provided, however, that if the General Partner receives a Notice of Redemption
after the record date, but prior to the effective date of such dividend, distribution, subdivision or combination, or such merger,
consolidation or combination, the number of outstanding Partnership Units of any Class shall be determined as if the General Partner
had received the Notice of Redemption immediately prior to the record date for such dividend, distribution, subdivision or combination
of such merger, consolidation or combination. If the General Partner takes any other action affecting the REIT Shares other than
actions specifically described above and, in the opinion of the General Partner such action would require an adjustment to the
number of Partnership Units to maintain the proportionate relationship between the number of outstanding Partnership Units to the
number of outstanding REIT Shares, the General Partner shall have the right to make such adjustment to the number of Partnership
Units, to the extent permitted by law, in such manner and at such time as the General Partner, in its sole discretion, may determine
to be appropriate under the circumstances.

 

(c)           No additional Partnership Units shall be issued to the General Partner unless (i) the additional Partnership Units are issued
to all Partners in proportion to their respective Percentage Interests with respect to the class of Partnership Units so issued;
(ii) (a) the additional Partnership Units are issued in connection with (x) an issuance of REIT Shares, or (y) an issuance of Preferred
Shares, New Securities or other interests in the General Partner (other than REIT Shares), which Preferred Shares, New Securities
or other interests have designations, preferences and other rights, terms and provisions that are substantially the same as the
designations, preferences and other rights, terms and provisions of the additional Partnership Units issued to the General Partner,
and (b) the General Partner contributes to the Partnership the cash proceeds or other consideration received in connection with
the issuance of such REIT Shares, Preferred Shares, New Securities or other interests in the General Partner; or (iii) the additional
Partnership Units are issued upon the conversion, redemption or exchange of debt, Partnership Units or other securities issued
by the Partnership.

 

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(d)           The General Partner shall not issue any additional REIT Shares, Preferred Shares, Junior Shares or New Securities unless
the General Partner contributes the cash proceeds or other consideration received from the issuance of such additional REIT Shares,
Preferred shares, Junior Shares or New Securities, as the case may be, and from the exercise of the rights contained in any such
additional New Securities, to the Partnership in exchange for (x) in the case of an issuance of REIT Shares, Partnership Units,
or (y) in the case of an issuance of Preferred Shares, Junior Shares or New Securities, Partnership Units with designations, preferences
and other rights, terms and provisions that are substantially the same as the designations, preferences and other rights, terms
and provisions of such Preferred Shares, Junior Shares or New Securities; provided, however, that notwithstanding the foregoing,
the General Partner may issue REIT Shares, Preferred Shares, Junior Shares or New Securities (a) pursuant to Section 8.5(b) hereof,
(b) pursuant to a dividend or distribution (including any stock split) of REIT Shares, Preferred Shares, Junior Shares, or New
Securities to all of the holders of REIT Shares, Preferred Shares, Junior Shares or New Securities, as the case may be, (c) upon
a conversion, redemption or exchange of Preferred Shares, (d) upon a conversion of Junior Shares into REIT Shares, (e) upon a conversion,
redemption, exchange or exercise of New Securities, or (f) in connection with an acquisition of a property or other asset to be
owned, directly or indirectly, by the General Partner if the General Partner determines that such acquisition is in the best interest
of the Partnership. In the event of any issuance of additional REIT Shares, Preferred Shares, Junior Shares, or New Securities
by the General Partner, and the contribution to the Partnership, by the General Partner, of the cash proceeds or other consideration
received from such issuance, if the cash proceeds actually received by the General Partner are less than the gross proceeds of
such issuance as a result of any underwriter’s discount or other expenses paid or incurred in connection with such issuance,
then the General Partner shall be deemed to have made a Capital Contribution to the Partnership in the amount equal to the sum
of the cash proceeds of such issuance plus the amount of such underwriter’s discount and other expenses paid by the General
Partner (which discount and expense shall be treated as an expense for the benefit of the Partnership).

 

(e)           The Partnership issued Special Limited Partnership Units to Moody National LPOP II, LLC in exchange for the cash contribution
reflected on Exhibit A hereto and for services performed or to be performed for the Partnership and its Subsidiaries, and
admitted such Person as the Special Limited Partner. The Special Limited Partner shall be entitled to certain distributions as
provided in Section 5.2 and certain preferential allocations of items of income and gain under Section 5.1. The Special Limited
Partnership Units will be subject to the transfer restrictions set forth in Article 9 and will be subject to redemption pursuant
to Section 8.6.

 

		4.4	Additional Funding.

 

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

 

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		4.5	Capital Accounts.

 

(a)           The Partnership shall maintain for each Partner a separate capital account (“Capital Account”) in accordance
with the rules of Regulations Section 1.704-1(b)(2)(iv). Each Partner’s Capital Account shall be increased by (i) the amount
of such Partner’s Capital Contributions and (ii) Profit allocated to such Partner and all items of Partnership income and
gain allocated to such Partner pursuant to Sections 5.1(c), 5.1(d) and 5.1(e) and decreased by (x) the amount of cash or Agreed
Value of all actual and deemed distributions of cash or property made to such Partner pursuant to this Agreement and (y) Loss allocated
to such Partner and all items of Partnership deduction and loss allocated to such Partner pursuant to Section 5.1(c).

 

(b)           In the event any interest in the Partnership is Transferred in accordance with the terms of this Agreement, the transferee
shall succeed to the Capital Account of the transferor to the extent it relates to the transferred interest.

 

(c)           The provisions of the Agreement relating to the maintenance of Capital Accounts are intended to comply with Regulations
Section 1.704-1(b), and shall be interpreted and applied in a manner consistent with such Regulations. In the event the General
Partner shall determine that it is prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto
(including, without limitation, debits or credits relating to liabilities which are secured by contributed or distributed property
or which are assumed by the Partnership, the General Partner, or the Limited Partners) are computed in order to comply with such
Regulations, the General Partner may make such modification, provided that it is not likely to have a material effect on the amounts
distributable to any Person upon the dissolution of the Partnership. The General Partner also shall (i) make any adjustments that
are necessary or appropriate to maintain equality between the Capital Accounts of the Partners and the amount of Partnership capital
reflected on the Partnership’s balance sheet, as computed for book purposes, in accordance with Regulations Section 1.704-1(b)(2)(iv)(g)
and (ii) make appropriate modifications in the event that unanticipated events might otherwise cause this Agreement not to comply
with Regulations Section 1.704-1(b) or 1.704-2.

 

		4.6	No Interest on Contributions

 

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

 

		4.7	Return of Capital Contributions

 

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

 

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		4.8	No Third-Party Beneficiary.

 

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

 

		4.9	Redemption of REIT Shares.

 

If, at any time, any
shares of capital stock of the General Partner are redeemed by the General Partner for cash, the Partnership shall, immediately
prior to such redemption, redeem an equal number of equivalent Partnership Units held by the General Partner upon the same terms
and for the same price per Partnership Unit as such shares are redeemed.

 

		4.10	Exchanges.

 

If the General Partner
exchanges any REIT Shares of any Class (“Exchanged REIT Shares”) for, or converts any REIT Shares of any Class
to, REIT Shares of a different Class (“Received REIT Shares”), then the General Partner shall, and shall cause
the Partnership to, exchange or convert a number of Partnership Units having the same Class designation as the Exchanged REIT Shares,
for Partnership Units having the same Class designation as the Received REIT Shares on the same terms that the General Partner
exchanged or converted the Exchanged REIT Shares.

 

Article
5  

PROFITS AND LOSSES; DISTRIBUTIONS

 

		5.1	Allocation of Profit and Loss.

 

(a)           General Partner Gross Income Allocation. There shall be specially allocated to the General Partner an amount of (i) first,
items of Partnership income and (ii) second, items of Partnership gain during each fiscal year or other applicable period, before
any other allocations are made hereunder, in an amount equal to the excess, if any, of the cumulative reimbursements made to the
General Partner under Section 6.5(b) (other than reimbursements that would properly be treated as “guaranteed payments”
or which are attributable to the reimbursement of expenses that would properly be either deductible by the Partnership or added
to the tax basis of any Partnership asset) over the cumulative allocations of Partnership income and gain to the General Partner
under this Section 5.1(a).

 

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(b)          General Allocations. The items of Profit and Loss of the Partnership for each fiscal year or other applicable period shall
be allocated among the Partners in a manner that will, as nearly as possible, cause the Capital Account balance of each Partner
at the end of such fiscal year or other applicable period to equal (i) the amount of the hypothetical distribution that such Partner
would receive if the Partnership were liquidated on the last day of such period and all assets of the Partnership, including cash,
were sold for cash equal to their Carrying Values, taking into account any adjustments thereto for such period, all liabilities
of the Partnership were satisfied in full in cash according to their terms (limited with respect to each nonrecourse liability
to the Carrying Value of the assets securing such liability) and the remaining cash proceeds (after satisfaction of such liabilities)
were distributed in full pursuant to Section 5.2, minus (ii) the sum of such Partner’s share of Partnership Minimum Gain
and Partner Nonrecourse Debt Minimum Gain and the amount, if any and without duplication, that the Partner would be obligated to
contribute to the capital of the Partnership, all computed as of the date of the hypothetical sale of assets. Notwithstanding the
foregoing, the General Partner may make such allocations as it deems reasonably necessary to give economic effect to the provisions
of this Agreement, taking into account facts and circumstances as the General Partner deems reasonably necessary for this purpose.

 

(c)          Special Allocations. Before applying Sections 5.1(a) and 5.1(b), the following regulatory allocations shall be made in the
following order and priority:

 

(i)          Minimum Gain Chargeback. Notwithstanding the provisions of this Section 5.1, if there is a net decrease in Partnership Minimum
Gain during any Partnership Year, each Partner shall be specially allocated items of Partnership income and gain for such year
(and, if necessary, subsequent years) in an amount equal to such Partner’s share of the net decrease in Partnership Minimum
Gain, as determined under Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in proportion
to the respective amounts required to be allocated to each Partner pursuant thereto. The items to be so allocated shall be determined
in accordance with Regulations Section 1.704-2(f). This Section 5.1(c)(i) is intended to comply with the minimum gain chargeback
requirements in Regulations Section 1.704-2(f) and shall be interpreted consistently therewith.

 

(ii)         Partner Minimum Gain Chargeback. Notwithstanding any other provision of this Section 5.1, if there is a net decrease in
Partner Minimum Gain attributable to a Partner Nonrecourse Debt during any Partnership Year, each Partner who has a share of the
Partner Minimum Gain attributable to such Partner Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(5),
shall be specially allocated items of Partnership income and gain for such year (and, if necessary, subsequent years) in an amount
equal to such Partner’s share of the net decrease in Partner Minimum Gain attributable to such Partner Nonrecourse Debt,
determined in accordance with Regulations Section 1.704-2(i)(5). Allocations pursuant to the previous sentence shall be made in
proportion to the respective amounts required to be allocated to each Partner pursuant thereto. The items to be so allocated shall
be determined in accordance with Regulations Section 1.704-2(i)(4). This Section 5.1(c)(ii) is intended to comply with the minimum
gain chargeback requirement in Regulations Section 1.704-2(i) and shall be interpreted consistently therewith.

 

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(iii)        Qualified Income Offset. In the event any Partner unexpectedly receives any adjustments, allocations or distributions described
in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6) and such Partner has an Adjusted
Capital Account Deficit, items of Partnership income and gain (consisting of a pro rata portion of each item of Partnership income,
including gross income and gain for the Partnership Year) shall be specially allocated to such Partner in an amount and manner
sufficient to eliminate, to the extent required by the Regulations, its Adjusted Capital Account Deficit created by such adjustments,
allocations or distributions as quickly as possible. This Section 5.1(c)(iii) is intended to constitute a “qualified income
offset” under Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

 

(iv)        No Excess Deficit. To the extent that any Partner has or would have, as a result of an allocation of Net Loss (or item thereof),
an Adjusted Capital Account Deficit, such amount of Net Loss (or item thereof) shall be allocated to the other Partners in accordance
with Section 5.1(b), but in a manner which will not produce an Adjusted Capital Account Deficit as to such Partners. To the extent
such allocation would result in all Partners having Adjusted Capital Account Deficits, such Net Loss (or item thereof) shall be
allocated to the General Partner.

 

(v)         Nonrecourse Deductions. Nonrecourse Deductions for any Partnership Year shall be allocated to the Partners (other than the
Special Limited Partner) in accordance with their respective Percentage Interests. If the General Partner determines in its good
faith discretion that the Partnership’s Nonrecourse Deductions must be allocated in a different ratio to satisfy the safe
harbor requirements of the Regulations promulgated under Section 704(b) of the Code, the General Partner is authorized, upon notice
to the Limited Partners, to revise the prescribed ratio for such Partnership Year to the numerically closest ratio which would
satisfy such requirements.

 

(vi)        Partner Nonrecourse Deductions. Any Partner Nonrecourse Deductions for any Partnership Year shall be specially allocated
to the Partner who bears the economic risk of loss with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse
Deductions are attributable in accordance with Regulations Sections 1.704-2(6)(4) and 1.704-2(i).

 

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

 

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(d)           Priority Allocations to the Special Limited Partner. Notwithstanding the provisions of Sections 5.1(a) and 5.1(b) above,
the Special Limited Partner shall be allocated on a priority basis items of income or gain, including, without limitation, items
of gain from a sale (including but not limited to net capital gain realized in connection with the adjustment to the tax book value
of Partnership assets under Section 704(b) of the Code) on a cumulative basis pursuant to this Section 5.1(d) in an amount equal
to the amount of distributions made (or in connection with a sale or winding up or liquidation of the Partnership, to be made)
to such Partner.

 

(e)           Allocations Between Transferor and Transferee. If a Partner transfers any part or all of its Partnership Interests, or if
Percentage Interests vary during a Partnership Year, the General Partner, in its sole and absolute discretion, shall determine
which method authorized under the Code and the Regulations shall be used to allocate the distributive shares.

 

(f)            Allocations
for Tax Purposes. All allocations for federal income tax purposes shall be consistent with all allocations in this Section 5.1,
except as otherwise required by Section 704(c) of the Code and Regulations Section 1.704-1(b)(4). The General Partner shall have
the authority to elect the method to be used by the Partnership for allocating items of income, gain, and expense as required
by Section 704(c) of the Code including a method that may result in a Partner receiving a disproportionately larger share of the
Partnership tax depreciation deductions, and such election shall be binding on all Partners.

 

(g)           Revisions to Allocations to Reflect Issuance of Additional Interests. In the event that the Partnership issues additional
Partnership Interests to the General Partner or any Additional Limited Partner pursuant to Article 4 hereof, the General Partner
shall make such revisions to this Section 5.1 as it deems necessary to reflect the terms of the issuance of such additional Partnership
Interests, including making preferential allocations to classes of Partnership Interests that are entitled thereto. Such revisions
shall not require the consent or approval of any other Partner.

 

		5.2	Distribution of Cash.

 

(a)           The Partnership shall distribute cash on a quarterly (or, at the election of the General Partner, more frequent) basis,
in an amount determined by the General Partner in its sole and absolute discretion, to the Partners who are Partners on the Partnership
Record Date with respect to such quarter (or other distribution period) in accordance with Section 5.2(b). The Partnership shall
be deemed to have distributed cash to the General Partner in an amount equal to the amount of distributions by the General Partner
that are reinvested in REIT Shares issued by the General Partner pursuant to the General Partner’s distribution reinvestment
plan, and the General Partner shall be deemed to have made Capital Contributions to the Partnership in the aggregate amount of
such distributions in return for an equal number of Partnership Units having the same Class designation as the issued REIT Shares.

 

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(b)         
Except for distributions pursuant to Section 5.4 of this Agreement in connection with the dissolution and liquidation of
the Partnership and subject to the provisions of Section 5.2(c) and 5.3 of this Agreement, distributions shall be made (i) first,
100% to the Partners (other than Special Limited Partner) in accordance with their respective Percentage Interests on the Partnership
Record Date until the Limited Partners (other than the Special Limited Partner) have received cumulative distributions under this
Section 5.2(b) equal to the aggregate Capital Contributions made by the Limited Partners (other than the Special Limited Partner)
to the Partnership plus a cumulative, noncompounded pre-tax rate of return thereon of 6.0% per annum, determined by taking into
account the dates on which all such Capital Contributions and distributions were made and (ii) second, (A) 85% to the Partners
(other than the Special Limited Partner), in accordance with their respective Percentage Interests on the Partnership Record Date
and (B) 15% to the Special Limited Partner. The amount distributed per Partnership Unit of any Class may differ from the amount
per Partnership Unit of another Class on account of differences in Class-specific expense allocations with respect to REIT Shares
as described in the Prospectus or for other reasons as determined by the Board of Directors of the General Partner. Any such differences
shall correspond to differences in the amount of distributions per REIT Share for REIT Shares of different Classes, with the same
adjustments being made to the amount of distributions per Partnership Unit for Partnership Units of a particular Class as are made
to the distributions per REIT Share by the General Partner with respect to REIT Shares having the same Class designation.

 

(c)          
Notwithstanding any other provision of this Agreement, the General Partner is authorized to take any action that it determines
to be necessary or appropriate to cause the Partnership to comply with any withholding requirements established under the Code
or any other federal, state or local law including, without limitation, pursuant to Sections 1441, 1442, 1445 and 1446 of the Code.
To the extent that the Partnership is required to withhold and pay over to any taxing authority any amount resulting from the allocation
or distribution of income to any Partner or assignee (including by reason of Section 1446 of the Code), either (i) if the actual
amount to be distributed to the Partner equals or exceeds the amount required to be withheld by the Partnership, the amount withheld
shall be treated as a distribution of cash in the amount of such withholding to such Partner, or (ii) if the actual amount to be
distributed to the Partner is less than the amount required to be withheld by the Partnership, the actual amount shall be treated
as a distribution of cash in the amount of such withholding and the additional amount required to be withheld shall be treated
as a loan (a “Partnership Loan”) from the Partnership to the Partner on the day the Partnership pays over such
amount to a taxing authority. A Partnership Loan shall be repaid through withholding by the Partnership with respect to subsequent
distributions to the applicable Partner or assignee. In the event that a Limited Partner (a “Defaulting Limited Partner”)
fails to pay any amount owed to the Partnership with respect to the Partnership Loan within fifteen (15) days after demand for
payment thereof is made by the Partnership on the Limited Partner, the General Partner, in its sole and absolute discretion, may
elect to make the payment to the Partnership on behalf of such Defaulting Limited Partner. In such event, on the date of payment,
the General Partner shall be deemed to have extended a loan (a “General Partner Loan”) to the Defaulting Limited
Partner in the amount of the payment made by the General Partner and shall succeed to all rights and remedies of the Partnership
against the Defaulting Limited Partner as to that amount. Without limitation, the General Partner shall have the right to receive
any distributions that otherwise would be made by the Partnership to the Defaulting Limited Partner until such time as the General
Partner Loan has been paid in full, and any such distributions so received by the General Partner shall be treated as having been
received by the Defaulting Limited Partner and immediately paid to the General Partner. Any amounts treated as a Partnership Loan
or a General Partner Loan pursuant to this Section 5.2(c) shall bear interest at the lesser of (i) the base rate on corporate loans
at large United States money center commercial banks, as published from time to time in The Wall Street Journal, or (ii) the maximum
lawful rate of interest on such obligation, such interest to accrue from the date the Partnership or the General Partner, as applicable,
is deemed to extend the loan until such loan is repaid in full.

 

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

 

		5.3	REIT Distribution Requirements.

 

The General Partner
shall use its commercially reasonable efforts to cause the Partnership to distribute amounts sufficient to enable the General Partner
to make stockholder distributions that will allow the General Partner to (i) meet its distribution requirement for qualification
as a REIT as set forth in Section 857 of the Code and (ii) avoid any federal income or excise tax liability imposed by the Code.

 

		5.4	No Right to Distributions in Kind.

 

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

 

		5.5	Limitations on Return of Capital Contributions.

 

Notwithstanding any
of the provisions of this Article 5, no Partner shall have the right to receive, and the General Partner shall not have the right
to make, a distribution that includes a return of all or part of a Partner’s Capital Contributions, unless after giving effect
to the return of a Capital Contribution, the sum of all Partnership liabilities, other than the liabilities to a Partner for the
return of his Capital Contribution, does not exceed the fair market value of the Partnership’s assets.

 

		5.6	Distributions upon Liquidation.

 

Upon liquidation of
the Partnership, after payment of, or adequate provision for, debts and obligations of the Partnership, including any Partner loans,
any remaining assets of the Partnership shall be distributed to all Partners in accordance with Section 5.2(b). To the extent deemed
advisable by the General Partner, appropriate arrangements (including the use of a liquidating trust) may be made to assure that
adequate funds are available to pay any contingent debts or obligations.

 

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		5.7	Substantial Economic Effect.

 

It is the intent of
the Partners that the allocations of Profit and Loss under this Agreement have substantial economic effect (or be consistent with
the Partners’ interests in the Partnership in the case of the allocation of losses attributable to nonrecourse debt) within
the meaning of Section 704(b) of the Code as interpreted by the Regulations promulgated pursuant thereto. Article 5 and other relevant
provisions of this Agreement shall be interpreted in a manner consistent with such intent.

 

Article
6  

RIGHTS, OBLIGATIONS AND POWERS OF THE GENERAL PARTNER

 

		6.1	Management of the Partnership.

 

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

 

(i)           
to acquire, purchase, own, operate, lease and dispose of any Real Estate Asset that the General Partner determines is necessary
or appropriate or in the best interests of the business of the Partnership;

 

(ii)          
to construct buildings and make other improvements on the Properties;

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

    26

     

    

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

(xxiii)       to take such other action, execute, acknowledge, swear to or deliver such other documents and instruments, and perform any
and all other acts that the General Partner deems necessary or appropriate for the formation, continuation and conduct of the business
and affairs of the Partnership (including, without limitation, all actions consistent with allowing the General Partner at all
times to qualify as a REIT unless the General Partner voluntarily terminates its REIT status) and to possess and enjoy all of the
rights and powers of a general partner as provided by the Act.

 

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

 

		6.2	Delegation of Authority.

 

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

 

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		6.3	Indemnification and Exculpation of Indemnitees.

 

(a)          
The Partnership shall indemnify an Indemnitee from and against any and all losses, claims, damages, liabilities, joint or
several, expenses (including reasonable legal fees and expenses), judgments, fines, settlements, and other amounts arising from
any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative, that relate to the
operations of the Partnership as set forth in this Agreement in which any Indemnitee may be involved, or is threatened to be involved,
as a party or otherwise, unless it is established that: (i) the act or omission of the Indemnitee was material to the matter giving
rise to the proceeding and either was committed in bad faith or was the result of active and deliberate dishonesty; (ii) the Indemnitee
actually received an improper personal benefit in money, Property or services; or (iii) in the case of any criminal proceeding,
the Indemnitee had reasonable cause to believe that the act or omission was unlawful. Any indemnification pursuant to this Section
6.3 shall be made only out of the assets of the Partnership.

 

(b)          
The Partnership shall reimburse an Indemnitee for reasonable expenses incurred by an Indemnitee who is a party to a proceeding
in advance of the final disposition of the proceeding upon receipt by the Partnership of (i) a written affirmation by the Indemnitee
of the Indemnitee’s good faith belief that the standard of conduct necessary for indemnification by the Partnership as authorized
in this Section 6.3 has been met and (ii) a written undertaking by or on behalf of the Indemnitee to repay the amount if it shall
ultimately be determined that the standard of conduct has not been met.

 

(c)          
The indemnification provided by this Section 6.3 shall be in addition to any other rights to which an Indemnitee or any
other Person may be entitled under any agreement, pursuant to any vote of the Partners, as a matter of law or otherwise, and shall
continue as to an Indemnitee who has ceased to serve in such capacity.

 

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

 

(e)          
For purposes of this Section 6.3, the Partnership shall be deemed to have requested an Indemnitee to serve as fiduciary
of an employee benefit plan whenever the performance by it of its duties to the Partnership also imposes duties on, or otherwise
involves services by, it to the plan or participants or beneficiaries of the plan; excise taxes assessed on an Indemnitee with
respect to an employee benefit plan pursuant to applicable law shall constitute fines within the meaning of this Section 6.3; and
actions taken or omitted by the Indemnitee with respect to an employee benefit plan in the performance of its duties for a purpose
reasonably believed by it to be in the interest of the participants and beneficiaries of the plan shall be deemed to be for a purpose
which is not opposed to the best interests of the Partnership.

 

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

 

(g)          
An Indemnitee shall not be denied indemnification in whole or in part under this Section 6.3 because the Indemnitee had
an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by
the terms of this Agreement.

 

(h)          
The provisions of this Section 6.3 are for the benefit of the Indemnitees, their heirs, successors, assigns and administrators
and shall not be deemed to create any rights for the benefit of any other Persons.

 

(i)            
Notwithstanding the foregoing, the Partnership may not indemnify or hold harmless an Indemnitee for any liability or loss
unless all of the following conditions are met: (i) the Indemnitee has determined, in good faith, that the course of conduct that
caused the loss or liability was in the best interests of the Partnership; (ii) the Indemnitee was acting on behalf of or performing
services for the Partnership; (iii) the liability or loss was not the result of (A) negligence or misconduct, in the case that
the Indemnitee is a director of the General Partner (other than an Independent Director), the Advisor or an Affiliate of the Advisor
or (B) gross negligence or willful misconduct, in the case that the Indemnitee is an Independent Director; and (iv) the indemnification
or agreement to hold harmless is recoverable only out of net assets of the Partnership. In addition, the Partnership shall not
provide indemnification for any loss, liability or expense arising from or out of an alleged violation of federal or state securities
laws by such party unless one or more of the following conditions are met: (i) there has been a successful adjudication on the
merits of each count involving alleged material securities law violations as to the Indemnitee; (ii) such claims have been dismissed
with prejudice on the merits by a court of competent jurisdiction as to the Indemnitee; or (iii) a court of competent jurisdiction
approves a settlement of the claims against the Indemnitee and finds that indemnification of the settlement and the related costs
should be made, and the court considering the request for indemnification has been advised of the position of the Commission and
of the published position of any state securities regulatory authority in which securities of the General Partner or the Partnership
were offered or sold as to indemnification for violations of securities laws.

 

		6.4	Liability of the General Partner.

 

(a)          
Notwithstanding anything to the contrary set forth in this Agreement, the General Partner shall not be liable for monetary
damages to the Partnership or any Partners for losses sustained or liabilities incurred as a result of errors in judgment or of
any act or omission if the General Partner acted in good faith. The General Partner shall not be in breach of any duty that the
General Partner may owe to the Limited Partners or the Partnership or any other Persons under this Agreement or of any duty stated
or implied by law or equity provided the General Partner, acting in good faith, abides by the terms of this Agreement.

 

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

 

(c)          
Subject to its obligations and duties as General Partner set forth in Section 6.1 hereof, the General Partner may exercise
any of the powers granted to it under this Agreement and perform any of the duties imposed upon it hereunder either directly or
by or through its agents. The General Partner shall not be responsible for any misconduct or negligence on the part of any such
agent appointed by it in good faith.

 

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

 

(e)          
Any amendment, modification or repeal of this Section 6.4 or any provision hereof shall be prospective only and shall not
in any way affect the limitations on the General Partner’s liability to the Partnership and the Limited Partners under this
Section 6.4 as in effect immediately prior to such amendment, modification or repeal with respect to matters occurring, in whole
or in part, prior to such amendment, modification or repeal, regardless of when claims relating to such matters may arise or be
asserted.

 

		6.5	Reimbursement of General Partner.

 

(a)          
Except as provided in this Section 6.5 and elsewhere in this Agreement (including the provisions of Articles 5 and 6 regarding
distributions, payments and allocations to which it may be entitled), the General Partner shall not be compensated for its services
as general partner of the Partnership.

 

(b)          
The General Partner shall be reimbursed on a monthly basis, or such other basis as the General Partner may determine in
its sole and absolute discretion, for all Administrative Expenses incurred by the General Partner. Reimbursement of Administrative
Expenses shall be treated as an expense of the Partnership and not as allocations of Partnership income or gain.

 

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		6.6	Outside Activities.

 

Subject to the Articles
of Incorporation and any agreements entered into by the General Partner or its Affiliates with the Partnership or a Subsidiary,
any officer, director, employee, agent, trustee, Affiliate or stockholder of the General Partner, the General Partner shall be
entitled to and may have business interests and engage in business activities in addition to those relating to the Partnership,
including business interests and activities substantially similar or identical to those of the Partnership. None of the Partnership,
Limited Partners or any other Person shall have any rights by virtue of this Agreement or the partnership relationship established
hereby in any such business ventures, interests or activities, and the General Partner shall have no obligation pursuant to this
Agreement to offer any interest in any such business ventures, interests and activities to the Partnership or any Limited Partner,
even if such opportunity is of a character which, if presented to the Partnership or any Limited Partner, could be taken by such
Person.

 

		6.7	Employment or Retention of Affiliates.

 

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

 

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

 

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

 

(d)          
Except as expressly permitted by this Agreement, neither the General Partner nor any of its Affiliates shall sell, transfer
or convey any Property to, or purchase any Property from, the Partnership, directly or indirectly, except pursuant to transactions
that are, in the General Partner’s sole discretion, on terms that are fair and reasonable to the Partnership.

 

		6.8	Title to Partnership Assets.

 

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

 

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Article
7  

CHANGES IN GENERAL PARTNER

 

		7.1	Transfer of the General Partner’s Partnership Units.

 

(a)         
The General Partner shall not transfer all or any portion of its Partnership Units (except as provided in Section 7.4) or
withdraw as General Partner except as provided in, or in connection with a transaction contemplated by, Section 7.1(d).

 

(b)         
Except as otherwise provided in Section 7.1(d) hereof, the General Partner shall not engage in any merger, consolidation
or other combination with or into another Person or the sale of all or substantially all of its assets (other than in connection
with a change in the General Partner’s state of incorporation or organizational form), in each case which results in a change
of control of the General Partner (a “Transaction”), unless:

 

(i)           
the consent of Limited Partners holding more than 50% of the Percentage Interests of the Limited Partners is obtained;

 

(ii)           as a result of such Transaction all Limited Partners will receive (A) for each Partnership Unit of each Class an amount
of cash, securities, or other Property equal to the greatest amount of cash, securities or other Property paid in the Transaction
to a holder of one REIT Share of the same Class designation as that Partnership Unit in consideration of one REIT Share, provided
that if, in connection with the Transaction, a purchase, tender or exchange offer (“Offer”) shall have been
made to and accepted by the holders of more than 50% of the outstanding REIT Shares, each holder of Partnership Units shall be
given the option to exchange its Partnership Units for the greatest amount of cash, securities, or other Property which a Limited
Partner holding Partnership Units would have received had it (1) exercised its Redemption Right and (2) sold, tendered or exchanged
pursuant to the Offer the REIT Shares received upon exercise of the Redemption Right immediately prior to the expiration of the
Offer and (B) for each Special Limited Partnership Unit an amount of cash, securities or other Property (as applicable based upon
the type of consideration and the proportions thereof paid to holders of REIT Shares in the Transaction) equal to the fair market
value of such Special Limited Partnership Unit at such time as determined in good faith by the General Partner by reference to
the value paid for the REIT Shares; or

 

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(iii)          the General Partner is the surviving entity in the Transaction and either (A) the holders of REIT Shares do not receive
cash, securities, or other Property in the Transaction or (B) all Limited Partners (other than the General Partner or any Subsidiary)
receive (1) in exchange for their Partnership Units of each Class, an amount of cash, securities, or other Property (expressed
as an amount per REIT Share) that is no less than the greatest amount of cash, securities, or other Property (expressed as an amount
per REIT Share) received in the Transaction by any holder of REIT Shares having the same designation as the Partnership Units being
exchanged and (2) in exchange for their Special Limited Partnership Units, an amount of cash, securities or other Property (as
applicable based upon the type of consideration and the proportions thereof paid to holders of REIT Shares in the Transaction)
equal to the fair market value of such Special Limited Partnership Units at such time as determined in good faith by the General
Partner by reference to the value paid for the REIT Shares.

 

(c)         
Notwithstanding Section 7.1(b), the General Partner may merge with or into or consolidate with another entity if immediately
after such merger or consolidation (i) substantially all of the assets of the successor or surviving entity (the “Survivor”),
other than Partnership Units held by the General Partner, are contributed, directly or indirectly, to the Partnership as a Capital
Contribution in exchange for Partnership Units with a fair market value equal to the value of the assets so contributed as determined
by the Survivor in good faith and (ii) the Survivor expressly agrees to assume all obligations of the General Partner, as appropriate,
hereunder. Upon such contribution and assumption, the Survivor shall have the right and duty to amend this Agreement as set forth
in this Section 7.1(d). The Survivor shall in good faith arrive at a new method for the calculation of the Cash Amount, and the
REIT Shares Amount for a Partnership Unit after any such merger or consolidation so as to approximate the existing method for such
calculation as closely as reasonably possible. Such calculation shall take into account, among other things, the kind and amount
of securities, cash and other Property that was receivable upon such merger or consolidation by a holder of REIT Shares of each
Class or options, warrants or other rights relating thereto, and which a holder of Partnership Units of any Class could have acquired
had such Partnership Units been exchanged immediately prior to such merger or consolidation. Such amendment to this Agreement shall
provide for adjustment to such method of calculation, which shall be as nearly equivalent as may be practicable to the adjustments
provided for with respect to adjustment events described in Section 4.3(b). The Survivor also shall in good faith modify the definition
of REIT Shares and make such amendments to Sections 8.5 and 8.6 hereof so as to approximate the existing rights and obligations
set forth in Sections 8.5 and 8.6 as closely as reasonably possible. The above provisions of this Section 7.1(c) shall similarly
apply to successive mergers or consolidations permitted hereunder.

 

In respect of any transaction
described in the preceding paragraph, the General Partner is required to use its commercially reasonable efforts to structure such
transaction to avoid causing the Limited Partners to recognize a gain for Federal income tax purposes by virtue of the occurrence
of or their participation in such transaction, provided such efforts are consistent with the exercise of the General Partner’s
board of directors’ fiduciary duties to the stockholders of the General Partner under applicable law.

 

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(d)         
Notwithstanding Section 7.1(a) or (b),

 

(i)           
a General Partner may transfer all or any portion of its Partnership Units to (A) a wholly owned Subsidiary of such General
Partner or (B) the owner of all of the ownership interests of such General Partner, and following a transfer of all of its General
Partnership Interests, may withdraw as General Partner; and

 

(ii)          
the General Partner may engage in a transaction not required by law or by the rules of any national securities exchange
on which the General Partner’s shares are listed to be submitted to the vote of the holders of the General Partner’s
shares.

 

		7.2	Admission of a Substitute or Additional General Partner.

 

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

 

(a)         
the Person to be admitted as a substitute or additional General Partner shall have accepted and agreed to be bound by all
the terms and provisions of this Agreement by executing a counterpart thereof and such other documents or instruments as may be
required or appropriate in order to effect the admission of such Person as a General Partner, and a certificate evidencing the
admission of such Person as a General Partner shall have been filed for recordation and all other actions required by Section 2.4
hereof in connection with such admission shall have been performed;

 

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

 

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

 

		7.3	Effect of Bankruptcy, Withdrawal, Death or Dissolution of a General Partner.

 

(a)         
Upon the occurrence of an Event of Bankruptcy as to a General Partner (and its removal pursuant to Section 7.4(a) hereof)
or the death, withdrawal, removal or dissolution of a General Partner (except that, if a General Partner is on the date of such
occurrence a partnership, the withdrawal, death, dissolution, Event of Bankruptcy as to, or removal of a partner in, such partnership
shall be deemed not to be a dissolution of such General Partner if the business of such General Partner is continued by the remaining
partner or partners), the Partnership shall be dissolved and terminated unless the Partnership is continued pursuant to Section
7.3(b) hereof. The merger of the General Partner with or into any entity that is admitted as a substitute or successor General
Partner pursuant to Section 7.2 hereof shall not be deemed to be the withdrawal, dissolution or removal of the General Partner.

 

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(b)          
Following the occurrence of an Event of Bankruptcy as to a General Partner (and its removal pursuant to Section 7.4(a) hereof)
or the death, withdrawal, removal or dissolution of a General Partner (except that, if a General Partner is, on the date of such
occurrence, a partnership, the withdrawal of, death, dissolution, Event of Bankruptcy as to, or removal of a partner in, such partnership
shall be deemed not to be a dissolution of such General Partner if the business of such General Partner is continued by the remaining
partner or partners), the Limited Partners, within 90 days after such occurrence, may elect to continue the business of the Partnership
for the balance of the term specified in Section 2.3 hereof by selecting, subject to Section 7.2 hereof and any other provisions
of this Agreement, a substitute General Partner by consent of a majority in interest of the Limited Partners. If the Limited Partners
elect to continue the business of the Partnership and admit a substitute General Partner, the relationship with the Partners and
of any Person who has acquired an interest of a Partner in the Partnership shall be governed by this Agreement.

 

		7.4	Removal of a General Partner.

 

(a)          
Upon the occurrence of an Event of Bankruptcy as to, or the dissolution of, a General Partner, such General Partner shall
be deemed to be removed automatically; provided, however, that if a General Partner is on the date of such occurrence a partnership,
the withdrawal, death or dissolution of, Event of Bankruptcy as to, or removal of, a partner in, such partnership shall be deemed
not to be a dissolution of the General Partner if the business of such General Partner is continued by the remaining partner or
partners. The Limited Partners may not remove the General Partner, with or without cause.

 

(b)          
If a General Partner has been removed pursuant to this Section 7.4 and the Partnership is continued pursuant to Section
7.3 hereof, such General Partner shall promptly transfer and assign its Partnership Units to the substitute General Partner approved
by a majority in interest of the Limited Partners in accordance with Section 7.3(b) hereof and otherwise be admitted to the Partnership
in accordance with Section 7.2 hereof. At the time of assignment, the removed General Partner shall be entitled to receive from
the substitute General Partner the fair market value of the Partnership Units of such removed General Partner as reduced by any
damages caused to the Partnership by such General Partner. Such fair market value shall be determined by an appraiser mutually
agreed upon by the General Partner and a majority in interest of the Limited Partners within ten (10) days following the removal
of the General Partner. In the event that the parties are unable to agree upon an appraiser, the removed General Partner and a
majority in interest of the Limited Partners each shall select an appraiser. Each such appraiser shall complete an appraisal of
the fair market value of the removed General Partner’s Partnership Units within thirty (30) days of the General Partner’s
removal, and the fair market value of the removed General Partner’s Partnership Units shall be the average of the two appraisals;
provided, however, that if the higher appraisal exceeds the lower appraisal by more than 20% of the amount of the lower appraisal,
the two appraisers, no later than forty (40) days after the removal of the General Partner, shall select a third appraiser who
shall complete an appraisal of the fair market value of the removed General Partner’s Partnership Units no later than sixty
(60) days after the removal of the General Partner. In such case, the fair market value of the removed General Partner’s
Partnership Units shall be the average of the two appraisals closest in value.

 

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(c)          
The Partnership Units of a removed General Partner, during the time after default until transfer under Section 7.4(b), shall
be converted to that of a Limited Partner; provided, however, such removed General Partner shall not have any rights to participate
in the management and affairs of the Partnership, and shall not be entitled to any portion of the income, expense, profit, gain
or loss allocations or cash distributions allocable or payable, as the case may be, to the Limited Partners. Instead, such removed
General Partner shall receive and be entitled only to retain distributions or allocations of such items that it would have been
entitled to receive in its capacity as General Partner, until the transfer is effective pursuant to Section 7.4(b).

 

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

 

Article
8  

RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS

 

		8.1	Management of the Partnership.

 

The Limited Partners
shall not participate in the management or control of Partnership business nor shall they transact any business for the Partnership,
nor shall they have the power to sign for or bind the Partnership, such powers being vested solely and exclusively in the General
Partner.

 

		8.2	Power of Attorney.

 

Each Limited Partner
hereby irrevocably appoints the General Partner its true and lawful attorney-in-fact, who may act for each Limited Partner and
in its name, place and stead, and for its use and benefit, to sign, acknowledge, swear to, deliver, file or record, at the appropriate
public offices, any and all documents, certificates, and instruments as may be deemed necessary or desirable by the General Partner
to carry out fully the provisions of this Agreement and the Act in accordance with their terms, which power of attorney is coupled
with an interest and shall survive the death, dissolution or legal incapacity of the Limited Partner, or the transfer by the Limited
Partner of any part or all of its Partnership Interests, unless otherwise stated in this Agreement.

 

		8.3	Limitation on Liability of Limited Partners.

 

No Limited Partner
shall be liable for any debts, liabilities, contracts or obligations of the Partnership. A Limited Partner shall be liable to the
Partnership only to make payments of its Capital Contribution, if any, as and when due hereunder. After its Capital Contribution
is fully paid, no Limited Partner shall, except as otherwise required by the Act, be required to make any further Capital Contributions
or other payments or lend any funds to the Partnership.

 

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		8.4	Redemption of Special Limited Partnership Interests.

 

Upon the earliest to
occur of (a) the termination or nonrenewal of the Advisory Agreement for “cause” (as defined in the Advisory
Agreement), (b) a Termination Event, or (c) the Listing, the Special Limited Partnership Units will be redeemed.

 

(a)          
If the Advisory Agreement is terminated or not renewed by the General Partner for “cause” (as defined
in the Advisory Agreement), all of the Special Limited Partnership Units shall be redeemed by the Partnership for $1 within thirty
(30) days after the termination or nonrenewal of the Advisory Agreement.

 

(b)          
Upon the occurrence of a Termination Event or the Listing, the Special Limited Partnership Units shall be redeemed for an
aggregate amount equal to the amount that would have been distributed to the Special Limited Partner under Section 5.2(b) if all
assets of the Partnership had been sold for their fair market value, all liabilities of the Partnership had been satisfied in full
according to their terms, and remaining proceeds were distributed to the Partners pursuant to Section 5.2. Such redemption shall
occur no later than thirty (30) days after the date of a Termination Event and no later than 240 days after the Listing. In determining
the fair market value of the assets of the Partnership, (i) in connection with a Termination Event, the General Partner shall obtain
an appraisal of the assets of the Partnership (excluding any assets which may be readily marked to market) and (ii) in connection
with the Listing, the General Partner shall make such determination (a) taking into account, in the event of a Listing on a national
securities exchange only, the market value of the General Partner’s listed shares based upon the average closing price, or
average of bid and asked prices, as the case may be, during a period of thirty (30) days during which such shares are traded beginning
one hundred and twenty (120) days after the Listing or (b) taking into account the value of the General Partner’s shares
based upon the initial public offering price in the event of an underwritten public offering. Payment to the Special Limited Partner
upon a Termination Event or a Listing shall be paid, at the Special Limited Partner’s discretion, in the form of (a) shares
of the General Partner’s common stock or (b) a non-interest bearing promissory note. In the event the Advisor elects to receive
shares of the General Partner’s common stock and the General Partner’s shares are not listed on a national securities
exchange, at the option of the Advisor, the Advisor and the General Partner shall enter into an agreement whereby the General Partner
shall register such shares of common stock with the Commission. However, any payments under a promissory note may not be made in
connection with a Termination Event until either (a) the closing of asset sales that result in aggregate, cumulative distributions
to the Partners (other than the Special Limited Partner) of the Partnership from operating income, sales proceeds and other sources
in an amount equal to their Capital Contributions to the Partnership plus a 6.0% cumulative non-compounded annual pre-tax return
thereon, or (b) a Listing (each a “Subsequent Liquidity Event”). In addition, the principal amount of the promissory
note issued in connection with a Termination Event will be subject to reduction as of the date of the Subsequent Liquidity Event
by an amount that will ensure that, in connection with the Subsequent Liquidity Event, the Special Limited Partner does not receive
in excess of 15% of the distributions that are made or are deemed to be made by the Partnership after the Partners (other than
the Special Limited Partner) have received or are deemed to have received aggregate, cumulative distributions equal to their Capital
Contributions to the Partnership plus a 6.0% cumulative non-compounded annual pre-tax return thereon.

 

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		8.5	Redemption Right.

 

(a)          
Subject to Sections 8.5(b), 8.5(c), 8.5(d), 8.5(e) and 8.5(f) and the provisions of any agreements between the Partnership
and one or more Limited Partners with respect to Partnership Units held by them, each Limited Partner shall have the right (subject
to the terms and conditions set forth herein) to require the Partnership to redeem (a “Redemption”) all or a
portion of the Partnership Units held by such Limited Partner (the “Tendered Units”) in exchange (a “Redemption
Right”) for REIT Shares issuable on, or the Cash Amount payable on, or a combination thereof having an equivalent value
to the REIT Shares issuable on, or the Cash Amount payable on, the Specified Redemption Date, as determined by the General Partner
in its sole discretion, provided that the Tendered Units shall have been outstanding and held by the Limited Partner for at least
one year. Any Redemption Right shall be exercised pursuant to a Notice of Redemption delivered to the Partnership (with a copy
to the General Partner) by the Limited Partner exercising the Redemption Right (the “Tendering Party”). No Limited
Partner may deliver more than two Notices of Redemption during each calendar year. A Limited Partner may not exercise the Redemption
Right for fewer than 1,000 Partnership Units or, if such Limited Partner holds fewer than 1,000 Partnership Units, all of the Partnership
Units held by such Partner. The Tendering Party shall have no right, with respect to any Partnership Units so redeemed, to receive
any distribution paid with respect to Partnership Units if the record date for such distribution is on or after the Specified Redemption
Date.

 

(b)          
If the General Partner elects to redeem Tendered Units for REIT Shares rather than cash, then the Partnership shall direct
the General Partner to issue and deliver such REIT Shares to the Tendering Party pursuant to the terms set forth in this Section
8.5(b), in which case, (i) the General Partner, acting as a distinct legal entity, shall assume directly the obligation with respect
thereto and shall satisfy the Tendering Party’s exercise of its Redemption Right and (ii) such transaction shall be treated,
for Federal income tax purposes, as a transfer by the Tendering Party of such Tendered Units to the General Partner in exchange
for REIT Shares. The percentage of the Tendered Units tendered for Redemption by the Tendering Party for which the General Partner
elects to issue REIT Shares (rather than cash) is referred to as the “Applicable Percentage.” In making such
election to acquire Tendered Units, the Partnership shall act in a fair, equitable and reasonable manner that neither prefers one
group or class of Limited Partners over another nor discriminates against a group or class of Limited Partners. If the Partnership
elects to redeem any number of Tendered Units for REIT Shares, rather than cash, on the Specified Redemption Date, the Tendering
Party shall sell such number of the Tendered Units to the General Partner in exchange for a number of REIT Shares equal to the
product of the REIT Shares Amount and the Applicable Percentage. The product of the Applicable Percentage and the REIT Shares Amount,
if applicable, shall be delivered by the General Partner as duly authorized, validly issued, fully paid and accessible REIT Shares
free of any pledge, lien, encumbrance or restriction, other than the Aggregate Share Ownership Limit and other restrictions provided
in the Articles of Incorporation, the bylaws of the General Partner, the Securities Act and relevant state securities or “blue
sky” laws. Notwithstanding the provisions of Section 8.5(a) and this Section 8.5(b), the Tendering Parties shall have
no rights under this Agreement that would otherwise be prohibited under the Articles of Incorporation.

 

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(c)         
In connection with an exercise of Redemption Rights pursuant to this Section 8.5, the Tendering Party shall submit the following
to the General Partner, in addition to the Notice of Redemption:

 

(1)         
A written affidavit, dated the same date as the Notice of Redemption, (a) disclosing the actual and constructive ownership,
as determined for purposes of Code Sections 856(a)(6) and 856(h), of REIT Shares by (i) such Tendering Party and (ii) any Related
Party and (b) representing that, after giving effect to the Redemption, and assuming that the General Partner elects to exchange
REIT Shares for the Tendered Units, neither the Tendering Party nor any Related Party will own REIT Shares in excess of the Aggregate
Share Ownership Limit (or, if applicable the Excepted Holder Limit);

 

(2)          
A written representation that neither the Tendering Party nor any Related Party has any intention to acquire any additional
REIT Shares prior to the closing of the Redemption on the Specified Redemption Date;

 

(3)          
An undertaking to certify, at and as a condition to the closing of the Redemption on the Specified Redemption Date, that
either (a) the actual and constructive ownership of REIT Shares by the Tendering Party and any Related Party remain unchanged from
that disclosed in the affidavit required by Section 8.5(c)(1) or (b) after giving effect to the Redemption, neither the Tendering
Party nor any Related Party shall own REIT Shares in violation of the Aggregate Share Ownership Limit (or, if applicable, the Excepted
Holder Limit); and

 

(4)         
Any other documents as the General Partner may reasonably require in connection with the issuance of REIT Shares upon the
exercise of the Redemption Right.

 

(d)         
Any Cash Amount to be paid to a Tendering Party pursuant to this Section 8.5 shall be paid on the Specified Redemption Date;
provided, however, that the General Partner may elect to cause the Specified Redemption Date to be delayed for up to an additional
180 days to the extent required for the General Partner to cause additional REIT Shares to be issued to provide financing to be
used to make such payment of the Cash Amount. Notwithstanding the foregoing, the General Partner agrees to use its best efforts
to cause the closing of the acquisition of Tendered Units hereunder to occur as quickly as reasonably possible.

 

(e)         
Notwithstanding any other provision of this Agreement, the General Partner shall place appropriate restrictions on the ability
of the Limited Partners to exercise their Redemption Rights to prevent, among other things, (a) any person from owning shares in
excess of the Common Share Ownership Limit, the Aggregate Share Ownership Limit and the Excepted Holder Limit, (b) the General
Partner’s common stock from being owned by fewer than 100 persons, (c) the General Partner from being “closely held”
within the meaning of section 856(h) of the Code, and (d) to ensure that the Partnership does not constitute a “publicly
traded partnership” under Section 7704 of the Code. If and when the General Partner determines that imposing such restrictions
is necessary, the General Partner shall give prompt written notice thereof (a “Restriction Notice”) to each
of the Limited Partners holding Partnership Units.

 

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(f)           
A redemption fee may be charged in connection with an exercise of Redemption Rights pursuant to this Section 8.5.

 

Article
9  

TRANSFERS OF LIMITED PARTNERSHIP INTERESTS AND SPECIAL LIMITED PARTNERSHIP INTERESTS

 

		9.1	Restrictions on Transfer of Limited Partnership Interests.

 

(a)          
No Limited Partner may offer, sell, assign, hypothecate, pledge or otherwise transfer all or any portion of his Limited
Partnership Interests, or any of such Limited Partner’s economic rights as a Limited Partner, whether voluntarily or by operation
of law or at judicial sale or otherwise (collectively, a “Transfer”) without the consent of the General Partner,
which consent may be granted or withheld in its sole and absolute discretion. Any such purported transfer undertaken without such
consent shall be considered to be null and void ab initio and shall not be given effect. The General Partner may require, as a
condition of any Transfer to which it consents, that the transferor assume all costs incurred by the Partnership in connection
therewith.

 

(b)          
No Limited Partner may withdraw from the Partnership other than as a result of a permitted Transfer of all of its Limited
Partnership Interest pursuant to this Article 9 or pursuant to a redemption of all of its Partnership Units pursuant to Section
8.5 or, with respect to the Special Limited Partner, pursuant to the redemption of its Special Limited Partnership Interest pursuant
to Section 8.4. Upon the permitted Transfer or redemption of all of a Limited Partner’s Limited Partnership Units, such Limited
Partner shall cease to be a Limited Partner.

 

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

 

(d)          
No Transfer by a Limited Partner of its Partnership Units, in whole or in part, may be made to any Person if (i) in the
opinion of the General Partner based on the advice of legal counsel for the Partnership, if appropriate, the transfer would result
in the Partnership’s being treated as an association taxable as a corporation (other than a qualified REIT subsidiary within
the meaning of Section 856(i) of the Code); (ii) in the opinion of the General Partner based on the advice of legal counsel for
the Partnership, if appropriate, it would adversely affect the ability of the General Partner to continue to qualify as a REIT
or subject the General Partner to any additional taxes under Section 857 or Section 4981 of the Code; (iii) such transfer is effectuated
through an “established securities market” or a “secondary market (or the substantial equivalent thereof)”
within the meaning of Section 7704 of the Code; (iv) such Transfer would cause the General Partner to own 10% or more of the ownership
interests of any tenant of a Property held by the partnership within the meaning of Section 856(d)(2)(B) of the Code; or (v) such
Transfer would result in the General Partner being “closely held” within the meaning of Section 856(h) of the Code.

 

    40

     

    

 

(e)         
No transfer by a Limited Partner of any Partnership Units may be made to a lender to the Partnership or any Person who is
related (within the meaning of Regulations Section 1.752-4(b)) to any lender to the Partnership whose loan constitutes a Nonrecourse
Liability, without the consent of the General Partner, which may be withheld in its sole and absolute discretion, provided that
as a condition to such consent the lender will be required to enter into an arrangement with the Partnership and the General Partner
to exchange or redeem for the Cash Amount any Partnership Units in which a security interest is held simultaneously with the time
at which such lender would be deemed to be a Partner in the Partnership for purposes of allocating liabilities to such lender under
Section 752 of the Code.

 

(f)          
Any Transfer in contravention of any of the provisions of this Article 9 shall be void and ineffectual and shall not be
binding upon, or recognized by, the Partnership.

 

(g)         
Prior to the consummation of any Transfer under this Article 9, the transferor and/or the transferee shall deliver to the
General Partner such opinions, certificates and other documents as the General Partner shall request in connection with such Transfer.

 

		9.2	Admission of Substitute Limited Partner.

 

(a)         
Subject to the other provisions of this Article 9, an assignee of the Partnership Units of a Limited Partner (which shall
be understood to include any purchaser, transferee, donee, or other recipient of any disposition of such Partnership Units) shall
be deemed admitted as a Limited Partner of the Partnership only with the consent of the General Partner and upon the satisfactory
completion of the following:

 

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

 

(ii)          
To the extent required, an amended Certificate evidencing the admission of such Person as a Limited Partner shall have been
signed, acknowledged and filed for record in accordance with the Act.

 

(iii)          The assignee shall have delivered a letter containing the representation set forth in Section 9.1(a) hereof and the agreement
set forth in Section 9.1(b) hereof.

 

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

 

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(v)          
The assignee shall have executed a power of attorney containing the terms and provisions set forth in Section 8.2 hereof.

 

(vi)          The assignee shall have paid all legal fees and other expenses of the Partnership and the General Partner and filing and
publication costs in connection with its substitution as a Limited Partner.

 

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

 

		9.3	Rights of Assignees of Partnership Units.

 

(a)         
Subject to the provisions of Sections 9.1 and 9.2 hereof, except as required by operation of law, the Partnership shall
not be obligated for any purposes whatsoever to recognize the assignment by any Limited Partner of its Partnership Units until
the Partnership has received notice thereof.

 

(b)         
Any Person who is the assignee of all or any portion of a Limited Partner’s Partnership Units, but does not become
a Substitute Limited Partner and desires to make a further assignment of such Partnership Units, shall be subject to all the provisions
of this Article 9 to the same extent and in the same manner as any Limited Partner desiring to make an assignment of its Partnership
Units.

 

		9.4	Effect of Bankruptcy, Death, Incompetence or Termination of a Limited Partner.

 

The occurrence of an
Event of Bankruptcy as to a Limited Partner, the death of a Limited Partner or a final adjudication that a Limited Partner is incompetent
(which term shall include, but not be limited to, insanity) shall not cause the termination or dissolution of the Partnership,
and the business of the Partnership shall continue if an order for relief in a bankruptcy proceeding is entered against a Limited
Partner, the trustee or receiver of his estate or, if he dies, his executor, administrator or trustee, or, if he is finally adjudicated
incompetent, his committee, guardian or conservator, shall have the rights of such Limited Partner for the purpose of settling
or managing his estate property and such power as the bankrupt, deceased or incompetent Limited Partner possessed to assign all
or any part of his Partnership Units and to join with the assignee in satisfying conditions precedent to the admission of the assignee
as a Substitute Limited Partner.

 

		9.5	Purchase for Investment.

 

(a)         
Each Limited Partner hereby represents and warrants to the General Partner and to the Partnership that the acquisition of
his Partnership Units is made as a principal for his account for investment purposes only and not with a view to the resale or
distribution of such Partnership Units.

 

    42

     

    

 

(b)          
Each Limited Partner agrees that he will not sell, assign or otherwise transfer his Partnership Units or any fraction thereof,
whether voluntarily or by operation of law or at judicial sale or otherwise, to any Person who does not make the representations
and warranties to the General Partner set forth in Section 9.5(a) above and similarly agree not to sell, assign or transfer such
Partnership Units or fraction thereof to any Person who does not similarly represent, warrant and agree.

 

Article
10               

BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS

 

		10.1	Books and Records.

 

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

 

		10.2	Custody of Partnership Funds; Bank Accounts.

 

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

 

(b)          
All deposits and other funds not needed in the operation of the business of the Partnership may be invested by the General
Partner in investment grade instruments (or investment companies whose portfolio consists primarily thereof), government obligations,
certificates of deposit, bankers’ acceptances and municipal notes and bonds. The funds of the Partnership shall not be commingled
with the funds of any other Person except for such commingling as may necessarily result from an investment in those investment
companies permitted by this Section 10.2(b).

 

		10.3	Fiscal and Taxable Year.

 

The fiscal and taxable
year of the Partnership shall be the calendar year.

 

		10.4	Annual Tax Information and Report.

 

Within seventy-five
(75) days after the end of each fiscal year of the Partnership, the General Partner shall furnish to each person who was a Limited
Partner at any time during such year the tax information necessary to file such Limited Partner’s individual tax returns
as shall be reasonably required by law.

 

    43

     

    

 

		10.5	Tax Matters Partner; Partnership Representative; Tax Elections; Special Basis Adjustments.

 

(a)          
The General Partner shall be the Tax Matters Partner and the Partnership Representative of the Partnership and shall have
the right to take all actions authorized by the Code for the Tax Matter Partner or Partnership Representative, as applicable. The
General Partner shall have the right to retain professional assistance in respect of any audit of the Partnership by the Service,
and all out-of-pocket expenses and fees incurred by the General Partner on behalf of the Partnership as Tax Matters Partner or
Partnership Representative shall constitute Partnership expenses.

 

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

 

(c)          
In the event of a transfer of all or any part of the Partnership Interest of any Partner, the Partnership, at the option
of the General Partner, may elect pursuant to Section 754 of the Code to adjust the basis of the Partnership’s assets. Notwithstanding
anything contained in Article 5 of this Agreement, any adjustments made pursuant to Section 754 of the Code shall affect only the
successor in interest to the transferring Partner and in no event shall be taken into account in establishing, maintaining or computing
Capital Accounts for the other Partners for any purpose under this Agreement. Each Partner will furnish the Partnership with all
information necessary to give effect to such election.

 

Article
11               

ARTICLE 11 AMENDMENT OF AGREEMENT

 

The General Partner’s
consent shall be required for any amendment to this Agreement. The General Partner, without the consent of the Limited Partners,
may amend this Agreement in any respect; provided, however, that the following amendments shall require the consent of Limited
Partners holding more than 50% of the Percentage Interests of the Limited Partners:

 

(a)          
any amendment affecting the operation of the adjustment events described in Section 4.3(b) or the Redemption Right (except
as provided in Section 8.5(d) or 7.1(d) hereof) in a manner adverse to the Limited Partners;

 

(b)          
any amendment that would adversely affect the rights of the Limited Partners to receive the distributions payable to them
hereunder, other than with respect to the issuance of additional Partnership Interests pursuant to Section 4.2 hereof;

 

(c)          
any amendment that would alter the Partnership’s allocations of profit and loss to the Limited Partners, other than
with respect to the issuance of additional Partnership Interests pursuant to Section 4.2 hereof; or

 

    44

     

    

 

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

 

Article
12               

ARTICLE 12 GENERAL PROVISIONS

 

		12.1	Notices.

 

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

 

		12.2	Survival of Rights.

 

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

 

		12.3	Additional Documents.

 

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

 

		12.4	Severability.

 

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

 

		12.5	Entire Agreement.

 

This Agreement and
exhibits attached hereto constitute the entire Agreement of the Partners and supersede all prior written agreements and prior and
contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof.

 

		12.6	Pronouns and Plurals.

 

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

 

    45

     

    

 

		12.7	Headings.

 

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

 

		12.8	Counterparts.

 

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

 

		12.9	Governing Law.

 

This Agreement shall
be governed by and construed in accordance with the laws of the State of Delaware; provided, however, that any cause of action
for violation of federal or state securities laws shall not be governed by this Section 12.9.

 

    46

     

    

 

IN WITNESS WHEREOF,
the General Partner has affixed its signature to this Agreement, as of the 12th day of June, 2017.

	 	 	 
	 	GENERAL PARTNER:
	 	 
	 	Moody National REIT II, Inc.
	 	 	 
	 	By:	/s/ Brett
    C. Moody
	 	 	Brett C. Moody
	 	 	Chief Executive Officer

 

    47

     

    

 

EXHIBIT A

CONTRIBUTIONS &
INTERESTS

 

	Partner	 	Capital
 Contribution	 	 	Class A 

Units	 	 	Class D

Units

	 
	 	Class I

Units

	 
	 	Class T

Units

	 
	 	Special
 Limited
 Partnership
 Units	 	Percentage

    Interest of Units	 
	GENERAL PARTNER:

Moody National REIT II, Inc.

6363 Woodway Drive, Suite 

110, Houston, Texas 77057	 	 	 	 	 	 	4,676,955.963	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	99.6158%	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LIMITED PARTNERS:

Moody National LPOP II, LLC

6363 Woodway Drive, Suite 

110, Houston, Texas 77057	 	$	1,000	 	 	 	40	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	.0008%	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Moody OP Holdings II, LLC 
6363 Woodway Drive, Suite 

110, Houston, Texas 77057	 	$	1,000	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	100	 	—	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Other Limited Partners	 	$	450,540	 	 	 	18,000	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	.3834%	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Totals	 	$	452,540	 	 	 	4,694,995.963	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	100	%

 

    A-1

     

    

 

Exhibit B

Notice of Exercise of Redemption Right

 

In accordance with
Section 8.5 of the Amended and Restated Limited Partnership Agreement (the “Agreement”) of Moody National Operating
Partnership II, LP, the undersigned hereby irrevocably (i) presents for redemption Partnership Units in Moody National Operating
Partnership II, LP in accordance with the terms of the Agreement and the Redemption Right referred to in Section 8.5 thereof, (ii)
surrenders such Partnership Units and all right, title and interest therein, and (iii) directs that the Cash Amount or REIT Shares
Amount (as defined in the Agreement) as determined by the General Partner deliverable upon exercise of the Redemption Right be
delivered to the address specified below, and if REIT Shares (as defined in the Agreement) are to be delivered, such REIT Shares
be registered or placed in the name(s) and at the address(es) specified below.

 

	 	 	 	 	 	 
	Dated: ___________, _______	(Name
    of Limited Partner)
	 	 
	 	 
	 	(Signature
    of Limited Partner)
	 	 
	 	 
	 	(Mailing
    Address)
	 	 
	 	 
	 	(City)	(State)	(Zip
    Code)
	 	 
	 	Signature Guaranteed by:
	 	 
	 	 
	 	 
	If REIT Shares are to be issued,
    issue to:	 
	 	 
	Name:	 	 
	 	 
	Social Security	 
	Or Tax I.D.	 
	Number:	 	 

 

    B-1

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