Document:

EX-10.2

 Exhibit 10.2 

SECOND AMENDED AND RESTATED 

ADVISORY AGREEMENT 
 BY
AND AMONG 
 STRATEGIC STORAGE GROWTH TRUST, INC., 

SS GROWTH OPERATING PARTNERSHIP, L.P. 

AND 
 SS GROWTH ADVISOR,
LLC 

 TABLE OF CONTENTS 

 

							
	 	  	 	  	PAGE	 
	 ARTICLE I DEFINITIONS
	  	 	1	  
	 ARTICLE II APPOINTMENT
	  	 	8	  
	 ARTICLE III AUTHORITY OF THE ADVISOR
	  	 	8	  
	 Section 3.1.
	  	 General
	  	 	8	  
	 Section 3.2.
	  	 Powers of the Advisor
	  	 	8	  
	 Section 3.3.
	  	 Approval by Directors
	  	 	8	  
	 Section 3.4.
	  	 Modification or Revocation of Authority of Advisor
	  	 	8	  
	 ARTICLE IV DUTIES OF THE ADVISOR
	  	 	8	  
	 Section 4.1.
	  	 Organizational and Offering Services
	  	 	9	  
	 Section 4.2.
	  	 Acquisition Services
	  	 	9	  
	 Section 4.3.
	  	 Asset Management Services and Administrative Services
	  	 	10	  
	 ARTICLE V BANK ACCOUNTS
	  	 	12	  
	 ARTICLE VI RECORDS; ACCESS
	  	 	12	  
	 ARTICLE VII OTHER ACTIVITIES OF THE ADVISOR
	  	 	12	  
	 Section 7.1.
	  	 General
	  	 	12	  
	 Section 7.2.
	  	 Policy with Respect to Allocation of Investment Opportunities
	  	 	13	  
	 ARTICLE VIII LIMITATIONS ON ACTIVITIES
	  	 	13	  
	 ARTICLE IX FEES
	  	 	14	  
	 Section 9.1.
	  	 Acquisition Fees
	  	 	14	  
	 Section 9.2.
	  	 Asset Management Fee
	  	 	14	  
	 Section 9.3.
	  	 Financing Fee
	  	 	14	  
	 Section 9.4.
	  	 Development Fee
	  	 	14	  
	 Section 9.5.
	  	 Disposition Fees
	  	 	14	  
	 Section 9.6.
	  	 Changes to Fee Structure
	  	 	14	  
	 ARTICLE X EXPENSES
	  	 	15	  
	 Section 10.1.
	  	 Reimbursable Expenses
	  	 	15	  
	 Section 10.2.
	  	 Other Services
	  	 	16	  
	 Section 10.3.
	  	 Timing of and Limitations on Reimbursements
	  	 	17	  
	 ARTICLE XI NO PARTNERSHIP OR JOINT VENTURE
	  	 	17	  
	 ARTICLE XII RELATIONSHIP WITH DIRECTORS
	  	 	17	  
	 ARTICLE XIII REPRESENTATIONS AND WARRANTIES
	  	 	18	  
	 Section 13.1.
	  	 The Company
	  	 	18	  
	 Section 13.2.
	  	 The Operating Partnership
	  	 	18	  
	 Section 13.3.
	  	 The Advisor
	  	 	19	  
	 ARTICLE XIV TERM; TERMINATION OF AGREEMENT
	  	 	19	  
	 Section 14.1.
	  	 Term
	  	 	19	  
	 Section 14.2.
	  	 Termination by Any Party
	  	 	19	  
	 Section 14.3.
	  	 Termination by the Advisor
	  	 	19	  
	 Section 14.4.
	  	 Termination by the Company
	  	 	19	  
	 Section 14.5.
	  	 Survival
	  	 	20	  
	 ARTICLE XV PAYMENTS TO AND DUTIES OF PARTIES UPON TERMINATION
	  	 	20	  
	 Section 15.1.
	  	 Reimbursable Expenses and Earned Fees
	  	 	20	  
	 Section 15.2.
	  	 Advisor’s Duties Upon Termination
	  	 	20	  
	 Section 15.3.
	  	 Non-Solicitation
	  	 	20	  

							
	 ARTICLE XVI ASSIGNMENT TO AN AFFILIATE
	  	 	21	  
	 ARTICLE XVII INCORPORATION OF THE CHARTER AND THE OPERATING PARTNERSHIP AGREEMENT
	  	 	21	  
	 ARTICLE XVIII INDEMNIFICATION BY THE COMPANY AND THE OPERATING PARTNERSHIP
	  	 	21	  
	 ARTICLE XIX INDEMNIFICATION BY ADVISOR
	  	 	22	  
	 ARTICLE XX LIMITATION OF LIABILITY
	  	 	22	  
	 ARTICLE XXI NOTICES
	  	 	22	  
	 ARTICLE XXII MODIFICATION
	  	 	23	  
	 ARTICLE XXIII SEVERABILITY
	  	 	23	  
	 ARTICLE XXIV CONSTRUCTION/GOVERNING LAW
	  	 	23	  
	 ARTICLE XXV ENTIRE AGREEMENT
	  	 	23	  
	 ARTICLE XXVI INDULGENCES, NOT WAIVERS
	  	 	24	  
	 ARTICLE XXVII GENDER
	  	 	24	  
	 ARTICLE XXVIII TITLES NOT TO AFFECT INTERPRETATION
	  	 	24	  
	 ARTICLE XXIX EXECUTION IN COUNTERPARTS
	  	 	24	  
	 ARTICLE XXX INITIAL INVESTMENT
	  	 	24	  

 SECOND AMENDED AND RESTATED ADVISORY AGREEMENT 

THIS SECOND AMENDED AND RESTATED ADVISORY AGREEMENT, dated as of January     , 2015, is entered into among STRATEGIC
STORAGE GROWTH TRUST, INC., a Maryland corporation (the “Company”), SS GROWTH OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the “Operating Partnership”) and SS GROWTH ADVISOR, LLC, a Delaware limited liability
company (the “Advisor”). 
 W I T N E S S E T H 

WHEREAS, on June 17, 2013, the Company, the Operating Partnership and the Advisor entered into an advisory agreement; 

WHEREAS, on December 10, 2013, the Company, the Operating Partnership and the Advisor entered into an amended and restated advisory
agreement; 
 WHEREAS, the Company has filed with the Securities and Exchange Commission (“SEC”) a Registration Statement on Form S-11 (No. 333-194380) (the “Registration Statement”) covering the issuance of Common Stock, and the Company may subsequently issue additional shares of Common Stock; 

WHEREAS, the Company, the Operating Partnership and the Advisor desire to further amend and restate such advisory agreement; 

WHEREAS, the Company intends to qualify as a REIT, and to invest its funds in investments permitted by the terms of the Company’s charter
and Sections 856 through 860 of the Code; 
 WHEREAS, the Company is the general partner of the Operating Partnership; 

WHEREAS, the Company and the Operating Partnership desire to avail themselves of the experience, sources of information, advice, assistance
and certain facilities available to the Advisor and its Affiliates and to have the Advisor undertake the duties and responsibilities hereinafter set forth, on behalf of, and subject to the supervision of the Board of Directors of the Company, all as
provided herein; and 
 WHEREAS, the Advisor is willing to undertake to render such services, subject to the supervision of the Board of
Directors, on the terms and conditions hereinafter set forth. 
 NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows: 
 ARTICLE I 

DEFINITIONS 
 As used in
this Advisory Agreement, the following terms have the definitions hereinafter indicated: 
 “Acquisition Expenses” means expenses
incurred by the Company, the Operating Partnership, the Advisor or any of their affiliates in connection with the sourcing, selection, evaluation and acquisition of, and investment in, Properties, whether or not acquired or made, including but not
limited to legal fees and expenses, travel and communications expenses, costs of financial analysis, 

 
appraisals and surveys, nonrefundable option payments on Property not acquired, accounting fees and expenses, computer use-related expenses, architectural and engineering reports, environmental
reports, title insurance and escrow fees, and personnel and other direct expenses related to the selection and acquisition of Properties. 

“Acquisition Fee” means 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 or the Advisor) in connection with the making or investing in mortgage loans or the purchase, development or construction of a Property, including, without limitation,
real estate commissions, acquisition fees, finder’s fees, selection fees, Development Fees and Construction Fees (except as provided in the following sentence), nonrecurring management fees, consulting fees, loan fees, points, or any other fees
or commissions of a similar nature. Excluded shall be any commissions or fees incurred in connection with the leasing of any Property, and Development Fees or Construction Fees paid to any Person or entity not affiliated with the Advisor in
connection with the actual development and construction of any Property. This fee is paid to the Advisor in the amount established pursuant to Section 9.1 for the services provided to the Company and the Operating Partnership described in
Section 4.2. 
 “Advisor” means the Person responsible for directing or performing the day-to-day business affairs of the
Company and the Operating Partnership, including a Person to which an Advisor subcontracts substantially all such functions. The Advisor is SS Growth Advisor, LLC or any Person which succeeds it in such capacity. 

“Advisory Agreement” means this advisory agreement among the Company, the Operating Partnership and the Advisor pursuant to which
the Advisor will direct or perform the day-to-day business affairs of the Company and the Operating Partnership, as it may be further amended or restated from time to time. 

“Affiliate” or “Affiliated” means, as to any individual, corporation, partnership, trust, limited liability company or
other legal entity (other than the Company): (a) any Person or entity, directly or indirectly owning, controlling, or holding with power to vote ten percent (10%) or more of the outstanding voting securities of another Person or entity;
(b) any Person ten percent (10%) or more of whose outstanding voting securities are directly or indirectly owned, controlled or held, with power to vote, by such other Person; (c) any Person or entity directly or indirectly through
one or more intermediaries controlling, controlled by, or under common control with another Person or entity; (d) any officer, director, general partner or trustee of such Person or entity; and (e) if such other Person or entity is an
officer, director, general partner, or trustee of a Person or entity, the Person or entity for which such Person or entity acts in any such capacity. 

“Appraised Value” means value according to an appraisal made by an Independent Appraiser. 

“Assets” means any and all GAAP assets including but not limited to all real estate investments (real, personal or otherwise),
tangible or intangible, owned or held by, or for the account of, the Company or the Operating Partnership, whether directly or indirectly through another entity or entities, including Properties. 

“Average Invested Assets” means, for a specified period, the average of the aggregate GAAP basis book carrying values of the Assets
invested, directly or indirectly, in equity interests in and loans secured, directly or indirectly, by real estate before reserves for depreciation or bad debts or other similar non-cash reserves, computed by taking the average of such values at the
end of each month during such period. 

  
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 “Asset Management Fee” means the monthly fee paid to the Advisor in the amount
established pursuant to Section 9.2 for the services provided to the Company and the Operating Partnership described in Section 4.3. 

“Board of Directors” or “Board” means the individuals holding such office, as of any particular time, under the Charter of
the Company, whether they are the Directors named therein or additional or successor Directors. 
 “Bylaws” means the bylaws of
the Company, as the same may be amended from time to time. 
 “Capped O&O Expenses” means all Organizational and Offering
Expenses (excluding Sales Commissions and the dealer manager fee) in excess of 3.5% of the Gross Proceeds raised in a completed Offering other than Gross Proceeds from Stock sold pursuant to the Distribution Reinvestment Plan. 

“Charter” means the charter of the Company, including the articles of incorporation and all articles of amendment, articles of
amendment and restatement, articles supplementary and other modifications thereto as filed with the State Department of Assessments and Taxation of the State of Maryland. 

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

“Common Stock” means shares of the Company’s common stock, $0.001 par value per share, the terms and conditions of which are
set forth in the Charter. 
 “Common Stockholders” means holders of shares of Common Stock. 

“Company” means Strategic Storage Growth Trust, Inc., a corporation organized under the laws of the State of Maryland. 

“Competitive Real Estate Commission” means a real estate or brokerage commission paid (or, if no commission is paid, the amount that
customarily would be paid) for the purchase or sale of a Property that is reasonable, customary and competitive in light of the size, type and location of the Property. 

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

“Contract Purchase Price” means the amount actually paid or allocated in respect of the purchase, development, construction, or
improvement of a Property, exclusive of Acquisition Fees and Acquisition Expenses. 

  
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 “Contract Sales Price” means the total consideration provided for in the sales contract
for the sale of a Property. 
 “Dealer Manager” means Select Capital Corporation, an Affiliate of the Advisor, or such other
Person or entity selected by the Board of Directors to act as the dealer manager for the offering of the Stock. Select Capital Corporation is a member of the Financial Industry Regulatory Authority. 

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

“Director” means an individual who is a member of the Board of Directors. 

“Disposition Fee” means the fee paid to the Advisor in connection with the sale of a property as described in Section 9.5 of
this Advisory Agreement. 
 “Distribution Reinvestment Plan” means the distribution reinvestment plan of the Company approved by
the Board and as set forth in the Prospectus. 
 “Distributions” means any dividends or other distributions of money or other
property paid by the Company to the holders of Common Stock or preferred stock, including dividends that may constitute a return of capital for federal income tax purposes. 

“Excess Amount” has the meaning set forth in Section 10.3(b) hereof. 

“Excess Expense Guidelines” has the meaning set forth in Section 10.3(b) hereof. 

“Expense Year” has the meaning set forth in Section 10.3(b) hereof. 

“GAAP” means generally accepted accounting principles consistently applied as used in the United States. 

“Gross Proceeds” means the aggregate purchase price of all Stock sold for the account of the Company, including Stock sold pursuant
to the Distribution Reinvestment Plan, without deduction for Sales Commissions, volume discounts, fees paid to the Dealer Manager or other Organization and Offering Expenses. Gross Proceeds does not include Stock issued in exchange for OP Units.

 “Independent Appraiser” means a person or entity, who is not an Affiliate of the Advisor or the Directors, who is engaged to a
substantial extent in the business of rendering opinions regarding the value of assets of the type held by the Company, and who is a qualified appraiser of real estate as determined by the Board. Membership in a nationally recognized appraisal
society such as the American Institute of Real Estate Appraisers or the Society of Real Estate Appraisers shall be conclusive evidence of such qualification. 

“Independent Director” means a Director who is not, and within the last two (2) years has not been, directly or indirectly
associated with the Advisor or the Sponsor by virtue of (a) ownership of an interest in the Advisor, the Sponsor or their Affiliates, (b) employment by the Advisor, the Sponsor or their Affiliates, (c) service as an officer or
director of the Advisor, the Sponsor or their Affiliates, (d) performance of services, other than as a Director, for the Company, (e) service as a director or trustee of more than three (3) real estate investment trusts organized by
the Advisor or the Sponsor or advised by the Advisor, or (f) maintenance of a material business or professional relationship with the Advisor, the 

  
 4 

 
Sponsor or any of their Affiliates. A business or professional relationship is considered material if the gross revenue derived by the Director from the Advisor, the Sponsor and Affiliates
exceeds five percent (5%) of either the Director’s annual gross revenue during either of the last two (2) years or the Director’s net worth on a fair market value basis. An indirect relationship shall include circumstances in
which a Director’s spouse, parents, children, siblings, mothers- or fathers-in-law, sons- or daughters-in-law or brothers- or sisters-in-law are or have been associated with the Advisor, the Sponsor, any of their Affiliates or the Company or
the Operating Partnership. 
 “Initial Public Offering” means the offering and sale of Common Stock of the Company pursuant to the
Company’s first effective registration statement covering such Common Stock filed under the Securities Act of 1933. 
 “Joint
Venture” or “Joint Ventures” means those joint venture or general partnership arrangements in which the Company or the Operating Partnership is a co-venturer or general partner which are established to acquire Properties. 

“NASAA” means the North American Securities Administrators Association, Inc. 

“NASAA Net Income” means for any period, the total revenues applicable to such period, less the total expenses applicable to such
period excluding additions to reserves for depreciation, bad debts or other similar non-cash reserves; provided, however, NASAA Net Income for purposes of calculating total allowable Operating Expenses shall exclude the gain from the sale of the
Company’s or the Operating Partnership’s Assets. 
 “NASAA REIT Guidelines” means the Statement of Policy Regarding Real
Estate Investment Trusts published by the North American Securities Administrators Association, Inc. as revised and adopted by the NASAA membership on May 7, 2007, as may be amended from time to time. 

“Offering” means an offering of Stock that is registered with the SEC, excluding Stock offered under any employee benefit plan. 

“Operating Expenses” means all direct and indirect costs and expenses incurred by the Company, as determined under GAAP, which in
any way are related to the operation of the Company or to Company business, including advisory fees, but excluding (a) the expenses of raising capital such as Organizational and Offering Expenses, legal, audit, accounting, underwriting,
brokerage, listing, registration, and other fees, printing and other such expenses and taxes incurred in connection with the issuance, distribution, transfer, registration and listing of the Stock on a national securities exchange, (b) interest
payments, (c) taxes, (d) non-cash expenditures such as depreciation, amortization and bad debt reserves, (e) Acquisition Fees and Acquisition Expenses, (f) real estate commissions on the Sale of Property, and other expenses
connected with the acquisition and ownership of real estate interests, mortgage loans, or other property (such as the costs of foreclosure, insurance premiums, legal services, maintenance, repair, and improvement of property) and (g) any
incentive fees which may be paid in compliance with the NASAA REIT Guidelines. The definition of “Operating Expenses” set forth above is intended to encompass only those expenses which are required to be treated as 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 an Operating Expense under the NASAA REIT Guidelines shall not be treated as an Operating Expense for purposes
hereof. 
 “Operating Partnership” means SS Growth Operating Partnership, L.P., a Delaware limited partnership. 

  
 5 

 “Operating Partnership Agreement” means the First Amended and Restated Limited
Partnership Agreement of the Operating Partnership, as amended and restated from time to time. 
 “OP Unit” means a unit of
limited partnership interest in the Operating Partnership. 
 “Organizational and Offering Expenses” means any and all costs and
expenses incurred by the Company, the Advisor or any Affiliate of either in connection with and in preparing the Company for registration of and subsequently offering and distributing its Stock to the public, which may include but are not limited to
total underwriting and brokerage discounts and commissions (including fees of the underwriters’ attorneys), legal, accounting and escrow fees, expenses for printing, engraving, amending, supplementing and mailing, distribution costs,
compensation to employees while engaged in registering, marketing and wholesaling the Stock, telegraph and telephone 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, depositories, experts, and fees, expenses and taxes related to the filing, registration and qualification of the sale of the Securities under Federal and State laws, including accountants’
and attorneys’ fees and other accountable offering expenses. Organization and Offering Expenses may include, but are not limited to: (a) amounts to reimburse the Advisor for all marketing related costs and expenses such as compensation to
and direct expenses of the Advisor’s employees or employees of the Advisor’s Affiliates in connection with registering and marketing the Stock; (b) travel and entertainment expenses related to the offering and marketing of the Stock;
(c) facilities and technology costs and other costs and expenses associated with the offering and to facilitate the marketing of the Stock including web site design and management; (d) costs and expenses of conducting training and
educational conferences and seminars; (e) costs and expenses of attending broker-dealer sponsored retail seminars or conferences; and (f) payment or reimbursement of bona fide due diligence expenses. 

“Person” shall mean any natural person, partnership, corporation, association, trust, limited liability company or other legal
entity. 
 “Property” or “Properties” means the real properties or real estate investments which are acquired by the
Company either directly or through the Operating Partnership, Joint Ventures, partnerships or other entities. 
 “Property
Manager” means any entity that has been retained to perform and carry out at one or more of the Properties property management services. 

“Prospectus” means any document, notice, or other communication satisfying the standards set forth in Section 10 of the
Securities Act of 1933, and contained in a currently effective registration statement filed by the Company with, and declared effective by, the SEC, or if no registration statement is currently effective, then the Prospectus contained in the most
recently effective registration statement. 
 “Public Offering” means the Initial Public Offering or any subsequent offering of
Stock that is registered with the SEC, excluding Stock offered under any employee benefit plan. 
 “Registration Statement” means
a registration statement filed by the Company with the Securities and Exchange Commission on Form S-11, as amended from time to time, in connection with a Public Offering. 

“REIT” means a corporation, trust or association which is engaged in investing in equity interests in real estate (including fee
ownership and leasehold interests and interests in partnerships and Joint Ventures holding real estate) or in loans secured by mortgages on real estate or both and that qualifies as a real estate investment trust under the REIT Provisions of the
Code. 

  
 6 

 “REIT Provisions of the Code” means Sections 856 through 860 of the Code and any
successor or other provisions of the Code relating to real estate investment trusts (including provisions as to the attribution of ownership of beneficial interests therein) and the regulations promulgated thereunder. 

“REIT Shares Amount” has the meaning set forth in the Operating Partnership Agreement. 

“Sale” or “Sales” means any transaction or series of transactions whereby: (a) the Operating Partnership sells,
grants, transfers, conveys or relinquishes its ownership of any Property or portion thereof, including the lease of any Property consisting of the building only, and including any event with respect to any Property which gives rise to a significant
amount of insurance proceeds or condemnation awards; (b) the Operating Partnership sells, grants, transfers, conveys or relinquishes its ownership of all or substantially all of the interest of the Operating Partnership in any Joint Venture in
which it is a co-venturer or partner; (c) any Joint Venture in which the Operating Partnership is a co-venturer or partner sells, grants, transfers, conveys or relinquishes its ownership of any Property or portion thereof, including any event
with respect to any Property which gives rise to insurance claims or condemnation awards; (d) the Operating Partnership sells, grants, conveys, or relinquishes its interest in any asset, or portion thereof, including any event with respect to
any asset which gives rise to a significant amount of insurance proceeds or similar awards; or (e) the Operating Partnership sells or otherwise disposes of or distributes all of its assets in liquidation of the Operating Partnership. 

“Sales Commissions” means any and all commissions payable to underwriters, dealer managers or other broker-dealers in connection
with the sale of Stock, including, without limitation, commissions payable to the Dealer Manager. 
 “Securities” means any class
or series of units or shares of the Company or the Operating Partnership, including common shares or preferred units or shares and any other evidences of equity or beneficial or other interests, voting trust certificates, bonds, debentures, notes or
other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as “Securities” or any certificates of interest, shares or participations in, temporary or interim
certificates for, receipts for, guarantees of, or warrants, options or rights to subscribe to, purchase or acquire, any of the foregoing. 

“Securities Act” means the Securities Act of 1933, as amended. 

“Sponsor” means Strategic Storage Holdings, LLC, a Delaware limited liability company. 

“Stock” means shares of stock of the Company of any class or series, including Common Stock, preferred stock or shares-in-trust.

 “Stockholders” means the registered holders of the Company’s Stock. 

“Termination Date” means the date of termination of this Advisory Agreement. 

  
 7 

 ARTICLE II 

APPOINTMENT 
 The Company,
through the powers vested in the Board of Directors including a majority of all Independent Directors, and the Operating Partnership, hereby appoints the Advisor to serve as its advisor and asset manager on the terms and conditions set forth in this
Advisory Agreement, and the Advisor hereby accepts such appointment. The Advisor undertakes to use its commercially reasonable 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 from time to time by the Board. 

ARTICLE III 
 AUTHORITY
OF THE ADVISOR 
 Section 3.1. General. All rights and powers to manage and control the day-to-day business and
affairs of the Company and the Operating Partnership shall be vested in the Advisor. The Advisor shall have the power to delegate all or any part of its rights and powers to manage and control the business and affairs of the Company and the
Operating Partnership to such officers, employees, Affiliates, agents and representatives of the Advisor, the Company or the Operating Partnership as it may from time to time deem appropriate. Any authority delegated by the Advisor to any other
Person shall be subject to the limitations on the rights and powers of the Advisor specifically set forth in this Advisory Agreement, the Charter, the Bylaws and the Operating Partnership Agreement. 

Section 3.2. Powers of the Advisor. Subject to the express limitations set forth in this Advisory Agreement and subject to
the supervision of the Board, the power to direct the management, operation and policies of the Company and the Operating Partnership shall be vested in the Advisor, which shall have the power by itself and shall be authorized and empowered on
behalf and in the name of the Company and the Operating Partnership, as applicable, to carry out any and all of the objectives and purposes of the Company and the Operating Partnership and to perform all acts and enter into and perform all contracts
and other undertakings that it may in its sole discretion deem necessary, advisable or incidental thereto to perform its obligations under this Advisory Agreement. 

Section 3.3. Approval by Directors. Notwithstanding the foregoing, any investment in Properties, including any acquisition
of a Property by the Company or the Operating Partnership or any investment by the Company or the Operating Partnership in a joint venture, limited partnership or similar entity owning real properties, will require the prior approval of the Board of
Directors or a committee of the Board constituting a majority of the Board. The Advisor will deliver to the Board of Directors all documents required by it to properly evaluate the proposed investment. 

Section 3.4. Modification or Revocation of Authority of Advisor. The Board may, at any time upon the giving of notice to
the Advisor, modify or revoke the authority or approvals set forth in Articles III and IV, 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. 

ARTICLE IV 
 DUTIES OF
THE ADVISOR 
 The Advisor undertakes to use its commercially reasonable 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 from time to time by the Board. In connection
therewith, the Advisor agrees to perform the following services on behalf of the Company and the Operating Partnership. 

  
 8 

 Section 4.1. Organizational and Offering Services. The Advisor shall manage
and supervise: 
 (a) the structure and development of any Offering, including the determination of the specific terms of the Securities to
be offered by the Company; 
 (b) the preparation of all organizational and offering related documents, and obtaining of all required
regulatory approvals of such documents; 
 (c) along with the Dealer Manager, approval of the participating broker dealers and negotiation
of the related selling agreements; 
 (d) coordination of the due diligence process relating to participating broker dealers and their
review of the Prospectus and other Offering and Company documents; 
 (e) preparation and approval of all marketing materials contemplated
to be used by the Dealer Manager or others in an Offering; 
 (f) along with the Dealer Manager, negotiation and coordination with the
transfer agent for the receipt, collection, processing and acceptance of subscription agreements, commissions, and other administrative support functions; 

(g) creation and implementation of various technology and electronic communications related to an Offering; and 

(h) all other services related to organization of the Company or the Offering, whether performed and incurred by the Advisor or its
Affiliates. 
 Section 4.2. Acquisition Services. The Advisor shall: 

(a) serve as the Company’s and the Operating Partnership’s investment and financial advisor and provide relevant market research and
economic and statistical data in connection with the Company’s assets and investment objectives and policies; 
 (b) subject to Article
III hereof and the investment objectives and policies of the Company: (i) locate, analyze and select potential investments; (ii) structure and negotiate the terms and conditions of transactions pursuant to which investments in Assets will
be made; (iii) acquire Assets on behalf of the Company and the Operating Partnership; and (iv) arrange for financing related to acquisitions of Assets; 

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

(d) prepare reports regarding prospective investments which include recommendations and supporting documentation necessary for the Board to
evaluate the proposed investments; 

  
 9 

 (e) obtain reports (which may be prepared by the Advisor or its Affiliates), where appropriate,
concerning the value of contemplated investments of the Company and the Operating Partnership; and 
 (f) negotiate and execute investments
and other transactions approved by the Board. 
 Section 4.3. Asset Management Services and Administrative Services. 

(a) Asset Management and Property Related Services. The Advisor shall: 

(i) negotiate and service the Company’s and the Operating Partnership’s debt facilities and other financings; 

(ii) monitor applicable markets and obtain reports (which may be prepared by the Advisor or its Affiliates) where appropriate, concerning the
value of investments of the Company and the Operating Partnership; 
 (iii) monitor and evaluate the performance of investments of the
Company and the Operating Partnership; provide daily management services to the Company and perform and supervise the various management and operational functions related to the Company’s and the Operating Partnership’s investments; 

(iv) coordinate with the Property Manager on its duties under any property management agreement and assist in obtaining all necessary
approvals of major property transactions as governed by the applicable property management agreement; 
 (v) coordinate and manage
relationships between the Company and the Operating Partnership with any joint venture partners; 
 (vi) consult with the officers and
Directors of the Company and provide assistance with the evaluation and approval of potential property dispositions, sales or refinancings; and 

(vii) provide the officers and Directors of the Company periodic reports regarding prospective investments in Properties. 

(b) Accounting, SEC Compliance and Other Administrative Services. The Advisor shall: 

(i) coordinate with the Company’s independent accountants and auditors to prepare and deliver to the Board an annual report covering the
Advisor’s compliance with certain material aspects of this Advisory Agreement; 
 (ii) maintain accounting systems, records and data
and any other information requested concerning the activities of the Company and the Operating Partnership as shall be required to prepare and to file all periodic financial reports and returns required to be filed with the SEC and any other
regulatory agency, including annual financial statements; 
 (iii) provide tax and compliance services and coordinate with appropriate
third parties, including independent accountants and other consultants, on related tax matters; 

  
 10 

 (iv) maintain all appropriate books and records of the Company and the Operating Partnership;

 (v) provide the officers of the Company and the Board with timely updates related to the overall regulatory environment affecting the
Company, as well as managing compliance with such matters, including but not limited to compliance with the Sarbanes-Oxley Act of 2002; 

(vi) consult with the officers of the Company and the Board relating to the corporate governance structure and appropriate policies and
procedures related thereto; 
 (vii) perform all reporting, record keeping, internal controls and similar matters in a manner to allow the
Company to comply with applicable law including the Sarbanes-Oxley Act of 2002; 
 (viii) 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, lenders, technical
advisors, attorneys, brokers, underwriters, corporate fiduciaries, escrow agents, depositaries, custodians, agents for collection, insurers, insurance agents, banks, builders, developers, property owners, mortgagers, construction companies and any
and all Persons acting in any other capacity deemed by the Advisor necessary or desirable for the performance of any of the foregoing services; 

(ix) supervise the performance of such ministerial and administrative functions as may be necessary in connection with the daily operations
of the Assets; 
 (x) provide the Company and the Operating Partnership with all necessary cash management services; 

(xi) consult with the officers of the Company and the Board and assist the Board in evaluating and obtaining adequate insurance coverage
based upon risk management determinations; 
 (xii) manage and perform the various administrative functions necessary for the management of
the day-to-day operations of the Company and the Operating Partnership; 
 (xiii) provide or arrange for administrative services and items,
legal and other services, office space, office furnishings, personnel and other overhead items necessary and incidental to the Company’s and the Operating Partnership’s business and operations; 

(xiv) provide financial and operational planning services and portfolio management functions; and 

(xv) from time-to-time, or at any time reasonably requested by the Board, make reports to the Board on the Advisor’s performance of
services to the Company and the Operating Partnership under this Advisory Agreement. 
 (c) Stockholder Services. The Advisor shall:

 (i) have the authority, in its sole discretion, to retain a transfer agent on behalf of the Company to perform all necessary transfer
agent functions; 
  

  
 11 

 (ii) manage and coordinate with such transfer agent, if retained by the Advisor, the
distribution process and payments to Stockholders; 
 (iii) manage communications with Stockholders, including answering phone calls,
preparing and sending written and electronic reports and other communications; and 
 (iv) establish technology infrastructure to assist in
providing Stockholder support and service. 
 ARTICLE V 

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 or 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 Board 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 Board and to the auditors of the Company. 

ARTICLE VI 
 RECORDS;
ACCESS 
 The Advisor shall maintain appropriate records of all its activities hereunder and make such records available for inspection
by the Board and by counsel, auditors and authorized agents of the Company and the Operating Partnership, at any time or from time to time during normal business hours. The Advisor, in the conduct of its responsibilities to the Company and the
Operating Partnership, shall maintain adequate and separate books and records for the Company’s and the Operating Partnership’s operations in accordance with GAAP, which shall be supported by sufficient documentation to ascertain that such
books and records are properly and accurately recorded. Such books and records shall be the property of the Company. Such books and records shall include all information necessary to calculate and audit the fees or reimbursements paid under this
Advisory Agreement. The Advisor shall utilize procedures to attempt to ensure such control over accounting and financial transactions as is reasonably required to protect the Company’s and the Operating Partnership’s assets from theft,
error or fraudulent activity. All financial statements that the Advisor delivers to the Company shall be prepared on an accrual basis in accordance with GAAP, except for special financial reports which by their nature require a deviation from GAAP.
The Advisor shall maintain necessary liaison with the Company’s independent accountants and shall provide such accountants with such reports and other information as the Company shall request. The Advisor shall at all reasonable times have
access to the books and records of the Company and the Operating Partnership. 
 ARTICLE VII 

OTHER ACTIVITIES OF THE ADVISOR 

Section 7.1. General. Nothing herein contained shall prevent the Advisor from engaging in 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 Advisory Agreement limit or restrict the right
of any director, officer, employee, or stockholder of the Advisor or its Affiliates to engage in any other business or to render services of any kind to any other partnership, corporation, firm, individual, trust or association. The Advisor may,
with respect to any investment in which the Company is a participant, also render advice and service to each 

  
 12 

 
and every other participant therein. 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 the Operating Partnership and its obligations to or its interest in any other partnership, corporation, firm, individual, trust or association. 

Section 7.2. Policy with Respect to Allocation of Investment Opportunities. Before the Advisor presents an investment
opportunity that would in its judgment be suitable for the Company to another Advisor-sponsored program, the Advisor shall determine in its sole discretion that the investment opportunity is more suitable for such other program than for the Company
based on factors such as the following: the investment objectives and criteria of each program; the cash requirements and anticipated cash flow of each entity; the size of the investment opportunity; the effect of the acquisition on diversification
of each entity’s investments; the income tax consequences of the purchase on each entity; the policies of each program relating to leverage; the amount of funds available to each program and the length of time such funds have been available for
investment. In the event that an investment opportunity becomes available that is, in the sole discretion of the Advisor, equally suitable for both the Company and another Advisor-sponsored program, then the Advisor may offer the other program the
investment opportunity if it has had the longest period of time elapse since it was offered an investment opportunity. The Advisor will use its reasonable efforts to fairly allocate investment opportunities in accordance with such allocation method
and will promptly disclose any material deviation from such policy or the establishment of a new policy, which shall be allowed provided (a) the Board is provided with notice of such policy at least 60 days prior to such policy becoming
effective and (b) such policy provides for the reasonable allocation of investment opportunities among such programs. The Advisor shall provide the Independent Directors with any information reasonably requested so that the Independent
Directors can ensure that the allocation of investment opportunities is applied fairly. Nothing herein shall be deemed to prevent the Advisor or an Affiliate from pursuing an investment opportunity directly rather than offering it to the Company or
another Advisor-sponsored program so long as the Advisor is fulfilling its obligation to present a continuing and suitable investment program to the Company which is consistent with the investment policies and objectives of the Company. If a
subsequent development, such as a delay in the closing of a property or a delay in the construction of a property, causes any such investment, in the opinion of the Board of Directors and the Advisor, to be more appropriate for an entity other than
the entity which committed to make the investment, however, the Advisor has the right to agree that the other entity affiliated with the Advisors or its Affiliates may make the investment. 

ARTICLE VIII 

LIMITATIONS ON ACTIVITIES 

Anything else in this Advisory 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 status of the Company as a REIT, (b) subject the Company to regulation under the Investment Company Act of 1940, as amended, (c) violate any law, rule, regulation or
statement of policy of any governmental body or agency having jurisdiction over the Company, its Stock or its other Securities, or the Operating Partnership, or (d) violate the Charter, the Bylaws or the Operating Partnership Agreement, 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 stockholders, and stockholders, directors and officers of the Advisor’s Affiliates shall not be liable to the Company or the Operating Partnership or to the Board or Stockholders for any act or omission by the Advisor, its
directors, officers or employees, or stockholders, directors or officers of the Advisor’s Affiliates except as provided in this Advisory Agreement. 

  
 13 

 ARTICLE IX 

FEES 
 Section 9.1.
Acquisition Fees. The Company will pay the Advisor, as compensation for the services described in Section 4.2, Acquisition Fees in an amount equal to 1.75% of (a) the Contract Purchase Price of each Property acquired by the
Company, including any debt attributable to the Property, plus amounts incurred for the development, construction or other capital improvements, or (b) the funds advanced in respect of a loan or other investment. The purchase price allocable
for a Property held through a Joint Venture shall equal the product of (a) the Contract Purchase Price of the Property and (b) the direct or indirect ownership percentage in the Joint Venture held directly or indirectly by the Company or
the Operating Partnership. For purposes of this Section 9.1, “ownership percentage” shall be the percentage of capital stock, membership interests, partnership interests or other equity interests held by the Company or the Operating
Partnership, without regard to classification of such interests. The total of all Acquisition Fees and Acquisition Expenses shall be limited in accordance with the Charter. 

Section 9.2. Asset Management Fee. Commencing on the date hereof, for the asset management services included in the
services described in Section 4.3(a), the Company shall pay the Advisor a monthly Asset Management Fee in an amount equal to one-twelfth of 0.5% of the Average Invested Assets. The Advisor may elect to receive the Asset Management Fee, in whole
or in part, in OP Units of the Operating Partnership or shares of the Company. 
 Section 9.3. Financing Fee. The Advisor
shall receive a financing fee of up to 0.5% of the borrowed amount of a loan, in connection with any loan or line of credit obtained for the Company in connection with the acquisition, development or repositioning of properties. 

Section 9.4. Development Fee. The Advisor or its Affiliates shall receive a market-based Development Fee equal to the
amount that would be payable to an unaffiliated third-party for development of a similar property in the same geographic region, which Development Fee may be reallowed to a third party developer. 

Section 9.5. Disposition Fees. If the Advisor or an Affiliate provides a substantial amount of the services (as determined
by a majority of the Directors, including a majority of the Independent Directors) in connection with the Sale of one or more Properties, the Advisor or such Affiliate shall receive at closing a Disposition Fee in an amount equal to the lesser of:
(a) 1% of the Contract Sales Price or (b) 50% of the Competitive Real Estate Commission. Any Disposition Fee payable under this section 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 or the Operating Partnership for each Property shall not exceed an amount equal to the lesser of (i) 6% of the aggregate Contract Sales Price of each
Property or (ii) the Competitive Real Estate Commission for each Property. The Company or the Operating Partnership will pay the Disposition Fee for a property at the time the property is sold. 

Section 9.6. Changes to Fee Structure. In the event of a listing of the Common Stock on a national securities exchange, the
Company and the Advisor shall negotiate in good faith to establish a fee structure appropriate for a perpetual-life entity. A majority of the Independent Directors must approve the new fee structure negotiated with the Advisor. In negotiating a new
fee structure, the Independent Directors shall consider all of the factors they deem relevant, including, but not limited to: (a) the amount of the advisory fee in relation to the asset value, composition and profitability of the Company’s
portfolio; (b) the success of the Advisor in generating opportunities that meet the investment objectives of the Company; (c) the rates charged to other REITs and to investors other than REITs by advisors performing the same or similar
services; (d) additional revenues realized by the Advisor and its Affiliates through 

  
 14 

 
their relationship with the Company, including loan administration, underwriting or broker commissions, servicing, engineering, inspection and other fees, whether paid by the REIT or by others
with whom the REIT does business; (e) the quality and extent of service and advice furnished by the Advisor; (f) the performance of the investment portfolio of the REIT, including income, conversion or appreciation of capital, and number
and frequency of problem investments; and (g) the quality of the Property portfolio of the Company in relationship to the investments generated by the Advisor for its own account. The new fee structure can be no more favorable to the Advisor
than the current fee structure. 
 ARTICLE X 

EXPENSES 

Section 10.1. Reimbursable Expenses. In addition to the compensation paid to the Advisor pursuant to Article IX hereof, the
Company or the Operating Partnership shall pay directly or reimburse the Advisor for all of the expenses paid or incurred by the Advisor (to the extent not reimbursable by another party, such as the Dealer Manager) in connection with the services it
provides to the Company and the Operating Partnership pursuant to this Advisory Agreement, including, but not limited to: 
 (a)
reimbursements for Organizational and Offering Expenses in connection with this offering, provided, however, that within 60 days after the end of the month in which an Offering terminates, the Advisor shall reimburse the Company to the extent
(i) there are Capped O&O Expenses borne by the Company or (ii) Organization and Offering Expenses borne by the Company (including selling commissions, dealer manager fees and non-accountable due diligence expense allowance but not
including Acquisition Fees or Acquisition Expenses) exceed 15% of the Gross Proceeds raised in a completed Offering; 
 (b) subject to the
limitation set forth below, Acquisition Expenses incurred by the Advisor or its Affiliates; 
 (c) subject to the limitation set forth
below, Acquisition Fees and Acquisition Expenses payable to unaffiliated Persons incurred in connection with the selection and acquisition of Properties; 

(d) the actual out-of-pocket cost of goods and services used by the Company and the Operating Partnership and obtained from entities not
affiliated with the Advisor including brokerage and other fees paid in connection with the purchase, operation and sale of Assets; 
 (e)
interest and other costs for borrowed money, including discounts, points and other similar fees; 
 (f) taxes and assessments on income or
Property and taxes as an expense of doing business and any taxes otherwise imposed on the Company and the Operating Partnership, its business or income; 

(g) costs associated with insurance required in connection with the business of the Company, the Operating Partnership or by the Board; 

(h) expenses of managing and operating Properties owned by the Company or the Operating Partnership, whether payable to an Affiliate of the
Company or a non-affiliated Person; 
 (i) all expenses in connection with payments to Directors and meetings of the Directors and
Stockholders; 

  
 15 

 (j) expenses associated with the listing of the Common Stock on a national securities exchange or
with the issuance and distribution of Securities other than the Stock issued in a Public Offering, such as selling commissions and fees, advertising expenses, taxes, legal and accounting fees, listing and registration fees; 

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

(i) expenses of organizing, converting, modifying, merging, liquidating or dissolving the Company, the Operating Partnership or of amending
the Charter, the Bylaws or the Operating Partnership Agreement; 
 (l) 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; 

(m) administrative service expenses, including all direct and indirect costs and expenses incurred by Advisor in fulfilling its duties
hereunder and including 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 the Acquisition Fee or
Disposition Fee. Such direct and indirect costs and expenses may include reasonable wages and salaries and other employee-related expenses of all employees of Advisor who are directly engaged in the operation, management, administration, and
marketing of the Company, including taxes, insurance and benefits relating to such employees, and legal, travel and other out-of-pocket expenses which are directly related to their services provided by Advisor pursuant to this Advisory Agreement;

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

(o) out-of-pocket costs for the Company and the Operating Partnership to comply with all applicable laws, regulation and ordinances; and all
other out-of-pocket costs necessary for the operation of the Company, the Operating Partnership and the Assets incurred by the Advisor in performing its duties hereunder. 

The Company or the Operating Partnership shall also reimburse the Advisor or Affiliates of the Advisor for all direct and indirect costs and
expenses incurred on behalf of the Company or the Operating Partnership prior to the execution of this Advisory Agreement. 
 The total of
all Acquisition Fees and Acquisition Expenses paid by the Company in connection with the purchase of a Property by the Company shall be reasonable, and shall in no event exceed an amount equal to 6% of the Contract Purchase Price, or in the case of
a mortgage loan, 6% of the funds advanced; provided, however, that a majority of the Directors (including the majority of the Independent Directors) not otherwise interested in the transaction may approve fees and expenses in excess of these limits
if they determine the transaction to be commercially competitive, fair and reasonable to the Company. 
 Section 10.2. Other
Services. Should the Directors request that the Advisor or any member, manager, officer or employee thereof render services for the Company or the Operating Partnership other than set forth in Article IV, such services shall be separately
compensated at such rates and in such amounts as are agreed by the Advisor and a majority of the Independent Directors, subject to the limitations contained in the Charter, and shall not be deemed to be services pursuant to the terms of this
Advisory Agreement. 

  
 16 

 Section 10.3. Timing of and Limitations on Reimbursements. 

(a) Expenses incurred by the Advisor on behalf of the Company and the Operating Partnership and payable pursuant to this Article X shall be
reimbursed no less frequently than monthly to the Advisor. The Advisor shall prepare a statement documenting the expenses of the Company and the Operating Partnership during each quarter, and shall deliver such statement to the Company within 45
days after the end of each quarter. Subject to the Excess Expense Guidelines, the Company or the Operating Partnership may advance funds to the Advisor for expenses the Advisor anticipates will be incurred by the Advisor within the current month and
any such advances shall be deducted from the amounts reimbursed by the Company or the Operating Partnership to the Advisor. 
 (b) Upon four
fiscal quarters after the Company’s or the Operating Partnership’s acquisition of the first Property, the Company shall not reimburse the Advisor at the end of any fiscal quarter Operating Expenses that, in the four consecutive fiscal
quarters then ended (the “Expense Year”) exceed (the “Excess Amount”) the greater of 2% of Average Invested Assets or 25% of NASAA Net Income (the “Excess Expense Guidelines”) for such year unless a majority of the
Independent Directors determines that such excess was justified, based on unusual and nonrecurring factors which they deem sufficient. If a majority of the Independent Directors does not approve such excess as being so justified, any Excess Amount
paid to the Advisor during a fiscal quarter shall be repaid to the Company. If a majority of the Independent Directors determines such excess was justified, then within 60 days after the end of any fiscal quarter of the Company for which total
reimbursed Operating Expenses for the Expense Year exceed the Excess Expense Guidelines, the Advisor, at the direction of a majority of the Independent Directors, shall send to the Stockholders a written disclosure of such fact, together with an
explanation of the factors a majority of the Independent Directors considered in determining that such excess expenses were justified. The Company will ensure that such determination will be reflected in the minutes of the meetings of the Board of
Directors. All figures used in the foregoing computation shall be determined in accordance with GAAP. 
 ARTICLE XI 

NO PARTNERSHIP OR JOINT VENTURE 

The parties to this Advisory Agreement are not partners or joint venturers with each other, and nothing in this Advisory Agreement shall be
construed to make them such partners or joint venturers or impose any liability as such on either of them, and neither shall have the power to bind or obligate any of them except as set forth herein. In all respects, the status of the Advisor under
this Advisory Agreement is that of an independent contractor. 
 ARTICLE XII 

RELATIONSHIP WITH DIRECTORS 

Subject to Article VIII of this Advisory Agreement and to restrictions set forth in the Charter or deemed 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, or directors, officers or stockholders of any director, officer or corporate parent of
an Affiliate may serve as a Director and as officers of the Company, except that no 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. Directors who are not Independent Directors 

  
 17 

 
will be individuals nominated by the Advisor, provided that such director nominees are either directors of the Advisor or have been elected by the board of directors of the Advisor as executive
officers of the Advisor. 
 ARTICLE XIII 

REPRESENTATIONS AND WARRANTIES 

Section 13.1. The Company. To induce the Advisor to enter into this Advisory Agreement, the Company hereby represents and
warrants that: 
 (a) The Company is a corporation, duly organized, validly existing and in good standing under the laws of the State of
Maryland with all requisite corporate power and authority and all material licenses, permits and authorizations necessary to carry out the transactions contemplated by this Advisory Agreement. 

(b) The Company’s execution, delivery and performance of this Advisory Agreement has been duly authorized by the Board of Directors
including a majority of all Independent Directors of the Company. This Advisory Agreement constitutes the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. The Company’s execution and
delivery of this Advisory Agreement and its fulfillment of and compliance with the respective terms hereof do not and will not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute a default
under, (iii) result in the creation of any lien, security interest, charge or encumbrance upon the assets of the Company pursuant to, (iv) give any third party the right to modify, terminate or accelerate any obligation under,
(v) result in a violation of or (vi) require any authorization, consent, approval, exception or other action by or notice to any court or administrative or governmental body pursuant to, the Charter or Bylaws or any law, statute, rule or
regulation to which the Company is subject, or any agreement, instrument, order, judgment or decree by which the Company is bound, in any such case in a manner that would have a material adverse effect on the ability of the Company to perform any of
its obligations under this Advisory Agreement. 
 Section 13.2. The Operating Partnership. To induce the Advisor to enter
into this Advisory Agreement, the Operating Partnership hereby represents and warrants that: 
 (a) The Operating Partnership is a Delaware
limited partnership, duly organized, validly existing and in good standing under the laws of the State of Delaware with all requisite power and authority and all material licenses, permits and authorizations necessary to carry out the transactions
contemplated by this Advisory Agreement. 
 (b) The Operating Partnership’s execution, delivery and performance of this Advisory
Agreement has been duly authorized. This Advisory Agreement constitutes the valid and binding obligation of the Operating Partnership, enforceable against the Operating Partnership in accordance with its terms. The Operating Partnership’s
execution and delivery of this Advisory Agreement and its fulfillment of and compliance with the respective terms hereof do not and will not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute
a default under, (iii) result in the creation of any lien, security interest, charge or encumbrance upon the assets of the Operating Partnership pursuant to, (iv) give any third party the right to modify, terminate or accelerate any
obligation under, (v) result in a violation of or (vi) require any authorization, consent, approval, exception or other action by or notice to any court or administrative or governmental body pursuant to, the Operating Partnership
Agreement or any law, statute, rule or regulation to which the Operating Partnership is subject, or any agreement, instrument, order, judgment or decree by which the Operating Partnership is bound, in any such case in a manner that would have a
material adverse effect on the ability of the Operating Partnership to perform any of its obligations under this Advisory Agreement. 

  
 18 

 Section 13.3. The Advisor. To induce the Company and the Operating Partnership
to enter into this Advisory Agreement, the Advisor represents and warrants that: 
 (a) The Advisor is a limited liability company, duly
organized, validly existing and in good standing under the laws of the State of Delaware with all requisite company power and authority and all material licenses, permits and authorizations necessary to carry out the transactions contemplated by
this Advisory Agreement. 
 (b) The Advisor’s execution, delivery and performance of this Advisory Agreement has been duly authorized.
This Advisory Agreement constitutes a valid and binding obligation of the Advisor, enforceable against the Advisor in accordance with its terms. The Advisor’s execution and delivery of this Advisory Agreement and its fulfillment of and
compliance with the respective terms hereof do not and will not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute a default under, (iii) result in the creation of any lien, security
interest, charge or encumbrance upon the Advisor’s assets pursuant to, (iv) give any third party the right to modify, terminate or accelerate any obligation under, (v) result in a violation of or (vi) require any authorization,
consent, approval, exemption or other action by or notice to any court or administrative or governmental body pursuant to, the Advisor’s articles of incorporation or bylaws, or any law, statute, rule or regulation to which the Advisor is
subject, or any agreement, instrument, order, judgment or decree by which the Advisor is bound, in any such case in a manner that would have a material adverse effect on the ability of the Advisor to perform any of its obligations under this
Advisory Agreement. 
 (c) The Advisor has received copies of the Charter, the Bylaws, the Registration Statement and the Operating
Partnership Agreement and is familiar with the terms thereof, including without limitation the investment limitations included therein. The Advisor warrants that it will use reasonable care to avoid any act or omission that would conflict with the
terms of the Charter, the Bylaws, the Registration Statement, or the Operating Partnership Agreement in the absence of the express direction of a majority of the Independent Directors. 

ARTICLE XIV 
 TERM;
TERMINATION OF AGREEMENT 
 Section 14.1. Term. This Advisory Agreement shall continue in force until the first
anniversary of the date hereof. Thereafter, this Advisory Agreement may be renewed for an unlimited number of successive one-year terms upon mutual consent of the parties. The Company, acting through the Board, will evaluate the performance of the
Advisor annually before renewing the Agreement, and each such renewal shall be for a term of no more than one year. 
 Section 14.2.
Termination by Any Party. This Advisory Agreement may be terminated upon 60 days’ written notice without cause or penalty, by any party (by a majority of the Independent Directors of the Company or the manager of the Advisor). 

Section 14.3. Termination by the Advisor. This Advisory Agreement may be terminated immediately by the Advisor in the event
of any material breach of this Advisory Agreement by the Company or the Operating Partnership not cured within 30 days after written notice thereof. 

Section 14.4. Termination by the Company. This Advisory Agreement may be terminated immediately by the Company or the
Operating Partnership in the event of (a) any material breach of this 

  
 19 

 
Advisory Agreement by the Advisor not cured by the Advisor within 30 days after written notice thereof; (b) a decree or order is rendered by a court having jurisdiction (i) adjudging
Advisor as bankrupt or insolvent, or (ii) approving as properly filed a petition seeking reorganization, readjustment, arrangement, composition or similar relief for Advisor under the federal bankruptcy laws or any similar applicable law or
practice, or (iii) appointing a receiver or liquidator or trustee or assignee in bankruptcy or insolvency of Advisor or a substantial part of the property of Advisor, or for the winding up or liquidation of its affairs; or (c) Advisor
(i) institutes proceedings to be adjudicated a voluntary bankrupt or an insolvent, (ii) consents to the filing of a bankruptcy proceeding against it, (iii) files a petition or answer or consent seeking reorganization, readjustment,
arrangement, composition or relief under any similar applicable law or practice, (iv) consents to the filing of any such petition, or to the appointment of a receiver or liquidator or trustee or assignee in bankruptcy or insolvency for it or
for a substantial part of its property, (v) makes an assignment for the benefit of creditors, (vi) is unable to or admits in writing its inability to pay its debts generally as they become due unless such inability shall be the fault of
the Operating Partnership, or (vii) takes company or other action in furtherance of any of the aforesaid purposes. 

Section 14.5. Survival. The provisions of Articles I, VI, VII and XV through XX survive termination of this Advisory
Agreement. 
 ARTICLE XV 

PAYMENTS TO AND DUTIES OF 

PARTIES UPON TERMINATION 

Section 15.1. Reimbursable Expenses and Earned Fees. After the Termination Date, the Advisor shall be entitled to receive
from the Company or the Operating Partnership within thirty (30) days after the effective date of such termination all amounts then accrued and owing to the Advisor, including all unpaid reimbursable expenses and all earned but unpaid fees
payable to the Advisor prior to termination of this Advisory Agreement. 
 Section 15.2. Advisor’s Duties Upon
Termination. The Advisor shall promptly upon termination: 
 (a) 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 Advisory Agreement, after deducting any accrued compensation and reimbursement for its expenses to which it is then entitled; 

(b) 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; 
 (c) deliver to the Board all assets, including
Properties, and documents of the Company and the Operating Partnership then in the custody of the Advisor; and 
 (d) cooperate with the
Company and the Operating Partnership to provide an orderly management transition. 
 Section 15.3. Non-Solicitation.
During the period commencing on the effective date of this Advisory Agreement and ending two years following the Termination Date, the Company shall not, without the Advisor’s prior written consent, directly or indirectly, (i) solicit or
encourage any employee, consultant, contractor or other Person performing services on behalf of the Advisor or its Affiliates to leave the employment or other service of the Advisor or any of its Affiliates, or (ii) hire or pay, directly or
indirectly, any compensation to, on behalf of the Company or any other Person, any employee, consultant, 

  
 20 

 
contractor or other Person performing services on behalf of the Advisor or its Affiliates who has left the employment of, or engagement by, the Advisor or any of its Affiliates within the
two-year period following the termination of that person’s employment with, or engagement by, the Advisor or any of its Affiliates. During the period commencing on the effective date of this Advisory Agreement and ending two years 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 any of its Affiliates with, or endeavor to entice away from the Advisor or
any of its Affiliates, any Person who during the term of this Advisory Agreement is, or during the preceding two-year period was, a tenant, co-investor, co-developer, joint venturer or other customer of the Advisor or any of its Affiliates. 

ARTICLE XVI 
 ASSIGNMENT
TO AN AFFILIATE 
 This Advisory Agreement may be assigned by the Advisor to an Affiliate with the approval of a majority of the
Independent Directors. The Advisor may assign any rights to receive fees or other payments under this Advisory Agreement without obtaining the approval of the Directors. This Advisory 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, as the case may be, to a legal entity that is a successor to all of the assets, rights and obligations of the Company or
the Operating Partnership, as the case may be, in which case such successor organization shall be bound hereunder and by the terms of said assignment in the same manner as the Company or the Operating Partnership, as the case may be, is bound by
this Advisory Agreement. 
 ARTICLE XVII 

INCORPORATION OF THE CHARTER AND THE OPERATING PARTNERSHIP 

AGREEMENT 
 To the extent
that the Charter or the Operating Partnership Agreement as in effect on the date hereof impose obligations or restrictions on the Advisor or grant the Advisor certain rights which are not set forth in this Advisory Agreement, the Advisor shall abide
by such obligations or restrictions and such rights shall inure to the benefit of the Advisor with the same force and effect as if they were set forth herein. 

ARTICLE XVIII 

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
officers, directors, partners and employees, from all liability, claims, damages or losses arising in the performance of their duties hereunder, and related expenses, including reasonable attorneys’ fees, to the extent such liability, claims,
damages or losses and related expenses are not fully reimbursed by insurance, subject to any limitations imposed by the laws of the State of Maryland and the State of Delaware, as applicable, and only if all of the following conditions are met: 

(a) The directors or the Advisor or its Affiliates have determined, in good faith, that the course of conduct that caused the loss or
liability was in the best interests of the Company and the Operating Partnership, as applicable; 
 (b) The Advisor or its Affiliates were
acting on behalf of or performing services for the Company or the Operating Partnership; 

  
 21 

 (c) Such liability or loss was not the result of negligence or misconduct by the Advisor or its
Affiliates; and 
 (d) Such indemnification or agreement to hold harmless is recoverable only out of the Company’s net assets,
including insurance proceeds, and not from its Stockholders. 
 (e) With respect to losses, liabilities or expenses arising from or out of
an alleged violation of federal or state securities laws, one or more of the following conditions are met: (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the particular
indemnitee; (ii) such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the particular indemnitee; or (iii) a court of competent jurisdiction approves a settlement of the claims against a
particular indemnitee and finds that indemnification of the settlement and the related costs should be made, and the court considering the request for indemnification has been advised of the position of the SEC and of the published position of any
state securities regulatory authority in which securities of the Company were offered or sold as to indemnification for violations of securities laws. Notwithstanding the foregoing, the Advisor shall not be entitled to indemnification or be held
harmless pursuant to this Article XVIII for any activity which the Advisor shall be required to indemnify or hold harmless the Company and the Operating Partnership pursuant to Article XIX. 

ARTICLE XIX 

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
gross negligence, bad faith, fraud, willful misfeasance, misconduct, or reckless disregard of its duties, but Advisor shall not be held responsible for any action of the Board in declining to follow any advice or recommendation given by the Advisor.

 ARTICLE XX 

LIMITATION OF LIABILITY 

In no event will the parties be liable for damages based on loss of income, profit or savings or indirect, incidental, consequential,
exemplary, punitive or special damages of the other party or person, including third parties, even if such party has been advised of the possibility of such damages in advance, and all such damages are expressly disclaimed. 

ARTICLE XXI 
 NOTICES

 Any notice in this Advisory Agreement permitted to be given, made or accepted by either party to the other, must be in writing and
may be given or served by (1) overnight courier, (2) depositing the same in the United States mail, postpaid, certified, return receipt requested, or (3) facsimile transfer. Notice deposited in the United States mail shall be deemed
given when mailed. Notice given in any other manner shall be effective when received at the address of the addressee. For purposes hereof the addresses of the parties, until changed as hereafter provided, shall be as follows: 

 

			
	To the Company:	 	Strategic Storage Growth Trust, Inc.
		 	Attention: H. Michael Schwartz
		 	Corporate Drive, Suite 120
		 	Ladera Ranch, California 92694
		 	Fax: 949-429-6606

  
 22 

			
	With a copy to:	 	Chairman of the Nominating and Corporate
		 	Governance Committee
		 	Corporate Drive, Suite 120
		 	Ladera Ranch, California 92694
		 	Fax: 949-429-6606
		
	To the Operating Partnership:	 	SS Growth Operating Partnership, L.P.
		 	Attention: H. Michael Schwartz
		 	Corporate Drive, Suite 120
		 	Ladera Ranch, California 92694
		 	Fax: 949-429-6606
		
	To the Advisor:	 	SS Growth Advisor, LLC
		 	Attention: H. Michael Schwartz
		 	Corporate Drive, Suite 120
		 	Ladera Ranch, California 92694
		 	Fax: 949-429-6606

 Any party may at any time give notice in writing to the other party of a change in its address for the purposes of this
Article XXI. 
 ARTICLE XXII 

MODIFICATION 
 This
Advisory 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. 

ARTICLE XXIII 

SEVERABILITY 
 The
provisions of this Advisory 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. 
 ARTICLE XXIV 

CONSTRUCTION/GOVERNING LAW 

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

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

  
 23 

 ARTICLE XXVI 

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 Advisory 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. 
 ARTICLE XXVII 

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. 

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

ARTICLE XXIX 
 EXECUTION
IN COUNTERPARTS 
 This Advisory 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 Advisory Agreement shall become binding when the counterparts hereof, taken together, bear the signatures of
all of the parties reflected hereon as the signatories. 
 ARTICLE XXX 

INITIAL INVESTMENT 
 The
Advisor has purchased 100 shares of Common Stock for $1,000.00. The Advisor has purchased 20,100 OP Units for $201,000. In addition, the Advisor may not sell any of the OP Units while the Advisor acts in such advisory capacity to the Company or the
Operating Partnership, provided, that such OP Units may be transferred to Affiliates of the Advisor. Affiliates of the Advisor may not sell any of the OP Units while the Advisor acts in such advisory capacity to the Company or the Operating
Partnership, provided, that such OP Units may be transferred to the Advisor or other Affiliates of the Advisor. The restrictions included above shall not apply to any other Securities acquired by the Advisor or its Affiliates. With respect to any
Securities owned by the Advisor, the Directors, or any of their Affiliates, neither the Advisor, nor the Directors, nor any of their Affiliates may vote or consent on matters submitted to the Stockholders regarding the removal of the Advisor,
Directors or any of their Affiliates or any transaction between the Company and any of them. In determining the requisite percentage in interest of Securities necessary to approve a matter on which the Advisor, Directors and any of their Affiliates
may not vote or consent, any Securities owned by any of them shall not be included. 
 [SIGNATURES APPEAR ON NEXT PAGE] 

  
 24 

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

			
	THE COMPANY:
	
	STRATEGIC STORAGE GROWTH TRUST, INC.
		
	By:	 	  

		 	Michael Schwartz
		 	President and Chief Executive Officer
	
	THE OPERATING PARTNERSHIP:
	
	SS GROWTH OPERATING PARTNERSHIP, L.P.
		
	BY:	 	STRATEGIC STORAGE GROWTH TRUST, INC., ITS GENERAL PARTNER
		
	By:	 	  

		 	Michael Schwartz
		 	President and Chief Executive Officer
	
	THE ADVISOR:
	
	SS GROWTH ADVISOR, LLC
		
	By:	 	  

		 	Michael Schwartz
		 	President

  
 25Exhibit 10.1 DeCata Contract

EMPLOYMENT AGREEMENT
This Employment Agreement (the “Agreement”) is made and entered into as of January 12, 2015 (the “Effective Date”), by and between Lawson Products, Inc., an Illinois corporation (the “Company”) and Michael G. DeCata (the “Executive”).
1.    At Will Employment.  The Company hereby employs Executive on an “at will” basis, and Executive’s employment by the Company may be terminated at any time at the option of the Company or Executive, as the case may be, on the terms and subject to the conditions set forth in this Agreement.

2.    Position and Duties.  Executive will serve as President and Chief Executive Officer of the Company and of Lawson Products, Inc., a Delaware corporation (“Parent”), or in such other capacity mutually agreed to between Executive and the Company by written amendment of this Agreement.  Executive’s duties and authorities will consist of all duties and authority customarily performed and held by persons holding equivalent positions in companies similar in nature and size to the Company or Parent as such duties and authority are reasonably defined, modified and delegated from time to time by the Board of Directors of Parent (the “Board”).  Executive will report solely to the Board.  Executive hereby acknowledges that he has a fiduciary responsibility and duty of loyalty to the Company and Parent hereunder.  For so long as Executive remains employed, Executive shall, on a full-time basis, devote his best efforts and his entire business time, energy, attention, knowledge and skill solely and exclusively to advance the interests, products and goodwill of the Company and Parent.  Executive shall diligently, competently and faithfully perform the duties assigned to him by the Company and Parent from time to time.

The duties and services to be performed by Executive hereunder shall be substantially rendered at the Company’s principal offices, except for travel on the Company’s business incident to the performance of Executive’s duties.  Executive will not, without the written consent of the Board, which consent shall not be unreasonably withheld:  (i) render service to others for compensation, or (ii) serve on any board or governing body of another entity.  If an outside activity subsequently creates a conflict with the Company’s business or prospective business, Executive agrees to cease engaging in such activity at such time.  Executive will observe and adhere to all applicable written Company policies and procedures adopted from time to time, such as they now exist or hereafter are supplemented, amended, modified or restated.
3.    Compensation.

(a)    Base Salary.  Executive will receive a base salary of $510,000 per annum (the “Base Salary”), as modified pursuant to the next sentence, payable in accordance with the Company’s customary payroll practices (including, but not limited to, practices regarding timing and withholding) as may be in effect from time to time.  The Base Salary will be subject to periodic review by the Compensation Committee of the Board (the “Committee”), and may be increased by the Committee at any time.

(b)    Incentive Plans and Bonuses.  Executive will be eligible for additional performance based compensation, at a target payout level of 100% of Base Salary (and at such threshold and maximum payout levels as set by the Committee in its sole discretion), based upon Executive’s ability to meet or exceed the targeted expectations applicable to his position, as the Committee in its sole discretion determines with input from the Executive and in accordance with and subject to the terms of the Senior Executive Officer Annual Incentive Plan, or any other applicable performance based compensation plan or program.

(c)    LTIP.  Executive will also be eligible to participate in the Senior Executive Officer Long-Term Incentive Plan (the “LTIP”) as determined by the terms of the LTIP and this Agreement, except as provided in Section 10(d).  

(d)    Equity Awards.  

		
	(i)
	Generally.  Executive will be eligible for stock options, restricted stock, stock awards, phantom stock units, stock appreciation units, stock performance rights, shareholder value appreciation rights or other such equity-based compensation opportunities from time to time during his employment as determined in the sole discretion of the Committee (“Equity Awards” which term, for the avoidance of doubt, shall include all awards under the Equity Compensation Plan and all awards under the Stock Performance Plan).  To the extent so provided, such equity-based compensation shall be subject to the terms of any applicable equity-based compensation plan, program and/or award agreement.

		
	(ii)
	Special Equity Award.  On the date of this Agreement, Parent is making a grant of 380,000 stock performance rights (“SPRs”) to Executive pursuant to the Lawson Products, Inc. Amended Stock Performance Plan (the “Stock Performance Plan”) and an option grant for 40,000 shares of common stock (the “Options” and, together with the SPRs, the “Special Equity Award”) to Executive pursuant to the Lawson Products, Inc. 2009 Equity Compensation Plan (as amended and restated effective May 13, 2014, the “Equity Compensation Plan”), which Special Equity Award is subject to the following:

(x) (i) 162,857 of the SPRs and 17,143 of the Options (“Tranche 1”) will have an exercise price equal to the fair market value of Parent’s common stock on the date of grant (the “Grant Date FMV”), (ii) 126,667 of the SPRs and 13,333 of the Options (“Tranche 2”) will have an exercise price equal to the Grant Date FMV plus $4.00 and (iii) 90,476 of the SPRs and 9,524 of the Options (“Tranche 3”) will have an exercise price equal to the Grant Date FMV plus $8.00;

(y) the Special Equity Award shall have a term of seven years and, subject to Executive’s continued employment with the Company, one-third of each of Tranche 1, Tranche 2 and Tranche 3 of the Special Equity Award shall vest and become exercisable on the first, second and third anniversaries of the grant date; and

		
	(z)
	subject to any terms explicitly provided in this Agreement, the SPRs included in the Special Equity Award shall be subject to the terms of the Stock Performance Plan and the applicable award agreement and the Options included in the Special Equity Award shall be subject to the terms of the Equity Compensation Plan and the applicable award agreement.

(e)    Benefit Plans.  Executive shall receive the following standard benefits; provided, however, the Company or Parent may modify or terminate such benefits from time to time to the extent and on such terms as the Company or Parent modifies or terminates such benefits as provided to other officers:
		
	(i)
	coverage under the Company’s group health plan on such terms as provided to other Company officers;

		
	(ii)
	long-term disability insurance coverage;

		
	(iii)
	group term life insurance with a death benefit amount of not less than one year of Executive’s Base Salary, with additional double indemnity coverage;

		
	(iv)
	accidental death insurance;

		
	(v)
	participation in the Company’s 401(k) plan, profit-sharing retirement plan and executive deferral plan; and

		
	(vi)
	four weeks’ annual vacation under the terms of the Company’s vacation policy for officers.

The items in Sections 3(b), 3(c), 3(d) and 3(e)(i)-(vi) referred to above, and any other benefit plans in which Executive may participate pursuant to such plan’s terms, are collectively referred to herein as “Benefit Plans”. 
4.    Termination of Employment.

(a)    Termination for Cause.  Without limitation of the “at will” basis of Executive’s employment by the Company, the Company may terminate Executive’s employment for “Cause”, where “Cause” means any of the following:

		
	(i)
	violation by Executive of any agreement between Executive and the Company or any law relating to non-competition, trade secrets, inventions, non-solicitation or confidentiality;

		
	(ii)
	material breach or default of any of Executive’s duties or other obligations or covenants under this Agreement (except where such breach or default is due to Executive becoming Disabled (as defined in Section 4(d)) which shall be governed by Section 4(d)), which has not been cured within 30 days of written notice thereof to Executive;

		
	(iii)
	Executive’s gross negligence, dishonesty or willful misconduct;

		
	(iv)
	any act or omission by Executive which has a material adverse effect on the Company’s business, reputation, goodwill or customer relations;

		
	(v)
	conviction of or pleading nolo contendere to a crime by Executive (other than traffic related offenses);

		
	(vi)
	any act or omission by Executive which, at the time it occurs, is in material violation of any Company policy, such as they now exist or hereafter are supplemented, amended, modified or restated; or

		
	(vii)
	an act of fraud or embezzlement or the misappropriation of property by Executive.

For purposes of this Agreement, Executive’s employment shall be deemed not to have been terminated for Cause unless and until there shall have been delivered to Executive a copy of a resolution of the Board finding that the termination is for Cause, duly adopted by the Board at a meeting called and held in accordance with the Company’s bylaws (with Executive to receive notice of the meeting at the same time as the members of the Board), at which Executive, together with Executive’s counsel, shall have the right to participate or to present a written response to the Board’s intention to terminate for Cause.  Subject to the preceding sentence, the Company may terminate Executive’s employment under this Agreement for Cause (as defined above) at any time, and Executive’s termination for Cause will be effective immediately upon the Company mailing or transmitting written notice of such termination to Executive.
(b)    Termination for Good Reason.  Without limitation of the “at will” basis of Executive’s employment by the Company, Executive may terminate Executive’s employment for “Good Reason”, where “Good Reason” means any of the following:

		
	(i)
	a decrease in Executive’s Base Salary;

		
	(ii)
	a material diminution in Executive’s authority, duties or responsibilities;

		
	(iii)
	a material change (with such change not to be less than 50 miles) in the geographic location at which Executive must perform Executive’s services; or 

		
	(iv)
	any other action or inaction that constitutes a material breach by the Company of this Agreement.

Executive is entitled to terminate Executive’s employment for Good Reason only if:
		
	(w)
	one or more of the conditions constituting Good Reason occurs without Executive’s written consent;

		
	(x)
	Executive provides notice to the Company of the existence of a condition constituting Good Reason within 15 days of the initial occurrence of such condition; 

		
	(y)
	the Company fails to remedy such condition constituting Good Reason within 30 days of being provided notice of such condition by Executive; and 

		
	(z)
	Executive voluntarily terminates Executive’s employment within 15 days of the expiration of the remedy period specified in clause (y).

(c)    Termination Due to Death.  Executive’s employment under this Agreement will terminate upon the death of Executive.

(d)    Termination Due to Disability.  Without limitation of the “at will” basis of Executive’s employment by the Company, if Executive becomes “Disabled” as such is defined under the Company’s long-term disability insurance policy, the Company may terminate Executive’s employment.  Executive agrees that if Executive becomes “Disabled”, Executive will be unable to perform the essential functions of Executive’s position and that there would be no reasonable accommodation which would not constitute an undue hardship to the Company.  Executive’s termination due to Disability will be effective immediately upon Executive’s receipt of written notice of such termination from the Company.  Such written notice shall be deemed received, if mailed first class through the U. S. Postal System, three (3) business days after mailing such written notice to Executive.

(e)    Termination Without Cause by the Company.  In furtherance of the “at will” basis of Executive’s employment by the Company, the Company may terminate Executive’s employment without Cause upon written notice to Executive.  Executive’s termination without Cause will be effective on the date of termination specified by the Company in such written notice.  Such written notice shall be deemed received, if mailed first class through the U. S. Postal System, three (3) business days after mailing such written notice to Executive.

(f)    Voluntary Termination by Executive.  In furtherance of the “at will” basis of Executive’s employment by the Company, Executive may voluntarily terminate his employment upon oral or written notice to the Company.  Executive’s voluntary termination shall be effective as of the time of such oral or written notice.

(g)    Simultaneous Termination of Director/Officer Positions.  Upon the effective date of termination of Executive’s employment, for any reason whatsoever, Executive will be deemed to have resigned from any position Executive may hold as a director and/or officer of Parent, the Company and any affiliate of Parent or the Company.  Parent and the Company are hereby irrevocably authorized to appoint a nominee to act on Executive’s behalf to execute all documents and do all tasks necessary to effectuate this Section 4(g).

5.    Payments Due Upon Termination.

(a)    Payments Due Upon Termination for Cause by the Company, or Voluntary Termination by Executive.  If the Company terminates Executive’s employment for “Cause” pursuant to Section 4(a) above, or Executive terminates his employment voluntarily pursuant to Section 4(f) above, the Company shall have no obligation to Executive, except:

		
	(i)
	the Company shall pay Executive no later than the next regularly scheduled payroll day any accrued and unpaid Base Salary and any accrued and unused vacation pay through the effective date of Executive’s termination;

		
	(ii)
	the Company shall pay Executive any additional payments, awards, or benefits, if any, which Executive is eligible to receive pursuant to the terms of any applicable Benefit Plans; and 

		
	(iii)
	Executive shall be entitled to all post-employment benefits required under applicable law.

The payments set forth in Sections 5(a)(i)-(iii) are collectively referred to herein as “Accrued Compensation”.

(b)    Payments Due Upon Termination Without Cause by the Company or for Good Reason by Executive.  Except as provided in Section 5(c) below, if the Company terminates Executive’s employment without “Cause” pursuant to Section 4(e) above or if Executive terminates Executive’s employment for “Good Reason” pursuant to Section 4(b) above, the Company shall have no obligation to Executive, except:

		
	(i)
	the Company shall pay Executive any Accrued Compensation;

		
	(ii)
	the Company shall pay Executive, subject to Section 5(f), in monthly installments commencing one (1) month after the effective date of Executive’s termination, at the rate of 100% of his then current Base Salary for a period of eighteen (18) months (the “Severance Period”);

		
	(iii)
	the Company shall pay Executive, subject to Section 5(f), in equal monthly installments, commencing one month after the effective date of Executive’s termination and continuing until the end of the Severance Period, an amount equal to Executive’s target bonus with respect to the year in which Executive’s termination occurs (or, if the target bonus for such year has not been established as of the date of termination, the target bonus for the prior year);

		
	(iv)
	Executive shall continue to be covered under the Company’s group health plan pursuant to Section 3(e)(i) above, including any spousal and dependent coverage, at active employee rates, for eighteen (18) months after the effective date of Executive’s termination, and, thereafter, Executive shall be eligible to exercise his rights to COBRA continuation coverage with respect to such group health plan for Executive, and, where applicable, Executive’s spouse and eligible dependents, at Executive’s expense; and

		
	(v)
	all of Executive’s outstanding unvested Equity Awards that would have otherwise vested during the Severance Period had Executive remained employed during the Severance Period, if any, shall immediately vest upon the effective date of Executive’s termination, and Executive shall have until the earlier of (A) one year following the effective date of Executive’s termination (or such longer exercise period that may be provided in an award agreement evidencing such Equity Award) and (B) the expiration of the term of such Equity Award to exercise any vested Equity Award that is subject to being exercised.  For the avoidance of doubt, this Section 5(b)(v) shall apply only to unvested Equity Awards where vesting is solely service-based (including the Special Equity Award described in Section 3(d)(ii)), but shall not apply to unvested Equity Awards where vesting is performance-based in whole or in part.

During the Severance Period under this Section 5(b), Executive shall, upon request of the Company, make himself reasonably available on a limited basis from time to time to consult with the Company regarding the business affairs of the Company, not more than twenty-four (24) hours in any calendar quarter, and at times that do not interfere with Executive’s employment time commitments with any successor employer.
(c)    Payments Due Upon Termination Without Cause by the Company or for Good Reason by Executive After a Change in Control.  In lieu of the payments due under Section 5(b) above, in the event the Company terminates Executive’s employment without “Cause” pursuant to Section 4(e) above or if 

Executive terminates Executive’s employment for “Good Reason” pursuant to Section 4(b) above, but only in each case within 24 months following a Change in Control as defined in Section 6 below, the Company shall have no obligation to Executive, except:

(i)    the Company shall pay Executive any Accrued Compensation;

		
	(ii)
	the Company shall pay Executive an amount equal to two (2) times Executive’s then current annual Base Salary, and two (2) times the higher of Executive’s target bonus with respect to the year in which Executive’s termination occurs or the actual bonus for the prior year (or, if the target bonus for such year has not been established as of the date of termination, two (2) times the higher of the target bonus or the actual bonus for the prior year).  Subject to Section 5(f), such amount shall be paid in a lump sum, to the extent a Section 409A Change in Control has occurred contemporaneously with the Change in Control (or anytime in the two calendar years prior to the effective date of Executive’s termination), no later than 30 days after the effective date of Executive’s termination, or to the extent a Section 409A Change in Control has not occurred during such period, it shall be paid in 24 equal monthly installments commencing one month after the effective date of Executive’s termination;

		
	(iii)
	Executive shall continue to be covered under the Company’s group health plan pursuant to Section 3(e)(i) above, including any spousal and dependant coverage, at active employee rates, for two (2) years after the effective date of Executive’s termination, and, thereafter, Executive shall be eligible to exercise his rights to COBRA continuation coverage with respect to such group health plan for Executive, and, where applicable, Executive’s spouse and eligible dependents, at Executive’s expense; and

		
	(iv)
	all of Executive’s outstanding Equity Awards, if any, shall immediately vest upon the effective date of Executive’s termination to the extent not already vested, and Executive shall have until the earlier of (A) one year following the effective date of Executive’s termination (or such longer exercise period that may be provided in an award agreement evidencing such Equity Award) and (B) the expiration of the term of such Equity Award to exercise any Equity Award that is subject to being exercised.

(d)    Payments Due Upon Termination Due to Death.  If Executive’s employment is terminated due to death pursuant to Section 4(c) above, the Company shall have no obligation to Executive, except:

		
	(i)
	the Company shall pay Executive any Accrued Compensation;

		
	(ii)
	the Company shall pay to the beneficiary(ies) identified in writing by Executive from time to time an amount equal to one and one-half (1.5) times Executive’s then current annual Base Salary, in eighteen (18) equal monthly installments commencing one month after the date of Executive’s death; and

		
	(iii)
	Executive’s spouse and dependents shall continue to be covered under the Company’s group health plan pursuant to Section 3(e)(i) above, at active employee rates for dependent coverage, for twenty-four (24) months after the date of Executive’s death, and, thereafter, Executive’s spouse and dependents shall be eligible to exercise their rights to COBRA coverage with respect to such group health plan at their expense.  

(e)    Payments Due Upon Termination Due to Disability.  If the Company terminates Executive’s employment due to “Disability” pursuant to Section 4(d) above, the Company shall have no obligation to Executive, except:

		
	(i)
	the Company shall pay Executive any Accrued Compensation;

		
	(ii)
	the Company shall continue to pay Executive, subject to Section 5(f), in monthly installments commencing one month after the effective date of termination:  (A) for 12 months at the rate of 100% of his then current Base Salary; and (B) for 24 months thereafter at the rate of 60% of his then current Base Salary.  The Company will be entitled to receive in payment from Executive or by taking a credit against the payments to be made under this Section 5(e)(ii) a sum equal to any Company provided long-term disability insurance benefit paid to or for the benefit of Executive during such 36 month period; and

		
	(iii)
	Executive shall continue to be covered under the Company’s group health plan pursuant to Section 3(e)(i) above, including any spousal and dependent coverage, at active employee rates for five and one-half (51⁄2) years after the effective date of Executive’s termination, and, thereafter, Executive shall be eligible to exercise his rights to COBRA continuation coverage with respect to such group health plan for Executive, and, where applicable, Executive’s spouse and eligible dependents, at Executive’s expense.  

(f)    Six (6) Month Delay.  If, at the time Executive becomes entitled to payments and benefits under Section 5 of this Agreement (“Severance Payment”), Executive is a Specified Employee (within the meaning of Code Section 409A and using the identification methodology selected by the Company from time to time), then, notwithstanding any other provision in Section 5 to the contrary, the following provision shall apply.  No Severance Payment considered by the Company in good faith to be deferred compensation under Code Section 409A that is payable upon Executive’s separation from service (as defined and determined under Code Section 409A), and not subject to an exception or exemption thereunder, shall be paid to Executive until the date that is six (6) months after Executive’s effective date of termination.  Any such Severance Payment that would otherwise have been paid to Executive during this six-month period shall instead be aggregated and paid to Executive on or as soon as administratively feasible after the date that is six (6) months after Executive’s effective date of termination, but not later than 60 days after such date.  Any Severance Payment to which Executive is entitled to be paid after the date that is six (6) months after Executive’s effective date of termination shall be paid to Executive in accordance with the terms of Section 5.

(g)    Release.  Executive shall not be entitled to receive any of the payments or benefits set forth in Section 5 (excepting any Accrued Compensation), and said payments and benefits shall be forfeited without further action by the Company, unless Executive (or if applicable, Executive’s beneficiaries and/or 

estate) executes a general release substantially in the form of Exhibit A (the “General Release”) and, on or prior to the 60th day following the date of termination (or such shorter period as set forth therein), such General Release becomes effective and irrevocable in accordance with the terms thereof.  With respect to any of the payments or benefits pursuant to this Section 5 considered by the Company in good faith to be deferred compensation under Code Section 409A, any amounts that would otherwise be payable during the 60-day period in the absence of the preceding General Release requirement shall be payable and effective on the 60th day after Executive’s termination of employment.

6.    Certain Definitions.

(a)    The term “Lawson Entities” shall mean Parent, any Subsidiary of Parent and any other entity in which any one or more of them has an ownership interest at any time during Executive’s employment with the Company and during the Restriction Period whether such entity is in the United States or elsewhere.

(b)    The term “Restriction Period” means the period of time in which Executive is employed by the Company and a period of eighteen (18) months after the effective date of Executive’s termination.  

(c)    The term “Lawson Entities’ Products, Systems and Services” means:

		
	(i)
	the acquisition for and the distribution and sale of fasteners, parts, hardware, pneumatics, hydraulic and other flexible hose fittings, tools, safety items and electrical and shop supplies, automotive and vehicular products, chemical specialties, maintenance chemicals and other chemical products, welding products and related items, all as more particularly described in the Lawson Entities’ sales kits and manuals;

		
	(ii)
	the sale and distribution and the providing of systems and services related to the items described in Section 6.1(c)(i);

		
	(iii)
	the manufacture, sale and distribution of production and specialized parts and supplies described in Section 6.1(c)(i);

		
	(iv)
	the provision of just-in-time inventories of component parts described in Section 6.1(c)(i) to original equipment manufacturers and of maintenance and repair parts described in Section 6.1(c)(i) to a wide variety of users; and

		
	(v)
	the provision of in-plant inventory systems and of electronic vendor-managed, inventory systems to various customers, related to the items described in Section 6.1(c)(i).

(d)    The term “Competitive Products, Systems and Services” shall mean products, systems or services in existence or under development during Executive’s employment with the Company which are the same as or substantially similar to or functional equivalents of those of the Lawson Entities including, without limitation, those which are or may be provided to the Lawson Entities’ customers on behalf of the Lawson Entities by employees, agents, or sales representatives of the Lawson Entities.

(e)    The term “Confidential Information” shall mean all information, including, but not limited to, trade secrets disclosed to Executive or known by Executive as a consequence of or through Executive’s employment by the Company, concerning the products, services, systems, customers and agents of the Lawson Entities, and specifically including without limitation:  computer programs and software, unpatented inventions, discoveries or improvements; marketing, organizational and product research and development; marketing techniques; promotional programs; compensation and incentive programs; customer loyalty programs; inventory systems; business plans; sales forecasts; personnel information, including but not limited to the identity of employees and agents of the Lawson Entities, their responsibilities, competence, abilities, and compensation; pricing and financial information; customer lists and information on customers or their employees, or their needs and preferences for the Lawson Entities’ Products, Systems and Services; information concerning planned or pending acquisitions or divestitures; and information concerning purchases of major equipment or property, and which:

		
	(i)
	has not been made generally available to the public; and

		
	(ii)
	is useful or of value to the current or anticipated business or research or development activities of the Lawson Entities, or of any customer or supplier of the Lawson Entities.

Confidential Information shall not include information which:
		
	(x)
	is in or hereafter enters the public domain through no fault of Executive;

		
	(y)
	is obtained by Executive from a third party having the legal right to use and to disclose the same without restriction; or 

		
	(z)
	was in the possession of Executive prior to receipt from the Lawson Entities (as evidenced by Executive’s written records predating the first date of employment with the Company).

Confidential Information also does not include Executive’s general skills and experience as defined under the governing law of this Agreement.
(f)    The term “Unauthorized Person or Entity” shall mean any individual or entity who or which has not signed an appropriate secrecy or confidentiality agreement with the Lawson Entities, or is not a current or target customer with whom Confidential Information is shared in the mutual interest of that person or entity and the Lawson Entities.

(g)    For purposes of this Agreement, a “Change in Control” shall be deemed to have occurred if:

		
	(i)
	any “person” or “group” of “persons” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended, and the rules promulgated thereunder) is or becomes the beneficial owner, directly or indirectly, of securities representing voting power, as of the date of determination, of then outstanding securities representing 40% or more of the combined voting power of Parent’s then outstanding securities as of such date of determination; or

		
	(ii)
	there is a merger, consolidation or reorganization involving Parent, or any direct or indirect subsidiary of Parent, unless:

		
	(A)
	the stockholders of Parent immediately before such merger, consolidation or reorganization will own, directly or indirectly, immediately following such merger, consolidation or reorganization, at least fifty percent (50%) of the combined voting power of the outstanding voting securities of the corporation resulting from such merger, consolidation or reorganization (the “Surviving Corporation”) or any parent thereof in substantially the same proportion as their ownership of the voting securities of Parent immediately before such merger, consolidation or reorganization; and

		
	(B)
	the individuals who were members of the Board immediately prior to the execution of the agreement providing for such merger, consolidation or reorganization constitute a majority of the members of the board of directors of the Surviving Corporation (or parent thereof); and

		
	(C)
	no “person” or “group” of “persons” as defined above is the beneficial owner of forty percent (40%) or more of the combined voting power of the then outstanding voting securities of the Surviving Corporation (or parent thereof); or

		
	(iii)
	there is a sale or other disposition of all or substantially all of the assets of Parent to an entity other than an entity:

		
	(A)
	of which at least fifty percent (50%) of the combined voting power of the outstanding voting securities are owned, directly or indirectly, by stockholders of Parent in substantially the same proportion as their then current ownership of the voting securities of Parent; and

		
	(B)
	of which a majority of the board of directors is comprised of the individuals who were members of the Board immediately prior to the execution of the agreement providing for such sale or disposition; and

		
	(C)
	of which no “person” or “group” of “persons” as defined above is the beneficial owner of forty percent (40%) or more of the combined voting power of the then outstanding voting securities of such entity (or parent thereof); or

		
	(iv)
	Individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”), cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the effective date hereof whose election, or nomination for election by Parent stockholders, was approved by a vote of at least four-fifths (4/5) of the directors 

then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, unless any such individual’s initial assumption of office occurs as a result of either an actual or threatened election contest (including, but not limited to, a consent solicitation).

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

(i)    The term “Code Section 409A” shall mean Section 409A of the Code and all regulations issued thereunder and applicable guidance thereto. 

(j)    The term “Subsidiary” means, with respect to any person or entity, any corporation, association or other entity of which more than 50% of the combined voting power is owned, directly or indirectly, by such person or entity and one or more other Subsidiaries of such person or entity.

(k)    The term “Section 409A Change in Control” means any “change in control event” within the meaning of Code Section 409A determined in accordance with the uniform methodology and procedures adopted by the Company.

7.    Protection of Company Assets.

(a)    Non-Competition.  Executive expressly agrees that, during the Restriction Period, provided that there shall not have occurred and be continuing any material non-compliance by the Company with its obligations under this Agreement, he shall not, in the United States, Canada and Mexico, directly or indirectly, as an owner, officer, director, employee, agent, advisor, financier, or in any other form or capacity, on behalf of himself or any other person, firm or other business entity, engage in or be concerned with any Competitive Products, Systems and Services, or any other duties or pursuits for monetary gain which interfere with or restrict Executive’s activities on behalf of the Lawson Entities or constitute competition with the business of the Lawson Entities as conducted or proposed to be conducted during the term of this Agreement or, with respect to applicable periods following Executive’s termination, as conducted or proposed to be conducted as of the date of Executive’s termination.  The foregoing notwithstanding, nothing herein contained shall be deemed to prevent Executive from investing his money in the capital stock or other securities of any corporation whose stock or securities are publicly-owned or are regularly traded on any public exchange, provided that Executive does not own more than a one percent (1%) interest therein.

(b)    Confidentiality.  Executive hereby acknowledges that, during the course of Executive’s employment, Executive has and will learn or develop Confidential Information in trust and confidence.  Executive agrees to use the Confidential Information solely for the purpose of performing his duties hereunder and not for his own private use or commercial purposes.  Executive acknowledges that unauthorized disclosure or use of Confidential Information, other than in discharge of Executive’s duties, will cause the Lawson Entities irreparable harm.  Executive shall maintain Confidential Information in strict confidence at all times and shall not divulge Confidential Information to any Unauthorized Person or Entity, or use in any manner, or knowingly allow another to use, any Confidential Information, without the Company’s prior written consent, during the term of employment or thereafter, for as long as such Confidential Information remains confidential.  Executive further acknowledges that the Lawson Entities operate and compete internationally and that the Lawson Entities will be harmed by the unauthorized disclosure or use of Confidential Information regardless of where such disclosure or use occurs, and that therefore this confidentiality agreement is not limited to any single state or other jurisdiction.

(c)    Non-Solicitation.  During the Restriction Period, provided that there shall not have occurred and be continuing any material non-compliance by the Company with its obligations under this Agreement, Executive shall not, directly or indirectly, for himself or on behalf of any person, firm or other entity, solicit, induce or encourage any person to leave her/his employment, agency or office with the Lawson Entities.  During the Restriction Period, provided that there shall not have occurred and be continuing any material non-compliance by the Company with its obligations under this Agreement, Executive shall not, directly or indirectly, for himself or on behalf of any person, firm or other entity, hire or retain or participate in hiring or retaining any person who then is an employee of or agent for the Lawson Entities or any person who has been an employee of or agent for the Lawson Entities at any time in the 90 days prior to termination of Executive’s employment, unless the Company is informed and gives its approval in writing prior to the hiring or retention.

Given Executive’s office and his participation in the development, sales, marketing, servicing and provision of the Lawson Entities’ Products, Systems and Services, Executive acknowledges that Executive has and will learn or develop Confidential Information relating to the development, sales, marketing, servicing or provision of the Lawson Entities’ Products, Systems and Services, and the Lawson Entities’ customers and prospective customers.  Executive further acknowledges that the Lawson Entities’ relationships with its customers have substantial value to the Lawson Entities.  Therefore, during the Restriction Period, provided that there shall not have occurred and be continuing any material non-compliance by the Company with its obligations under this Agreement, Executive shall not, directly or indirectly, for himself or on behalf of any person, firm or other entity, solicit or sell, attempt to sell, or supervise, participate in, or assist the sale or solicitation of Competitive Products and Systems to any person, firm or other entity to which the Lawson Entities sold any of the Lawson Entities’ Products, Systems and Services during the last two (2) years of Executive’s employment with the Company prior to the effective date of termination.  However, this Section 7(c) shall not prohibit the solicitation of any actual or potential customer of the Lawson Entities which does not fall within the preceding description.  This Section 7(c) is independent of the obligations of confidentiality under this Agreement and the non-compete provisions of this Agreement.
(d)    Return of Property.  All notes, lists, reports, sketches, plans, data contained in computer hardware or software, memoranda or other documents concerning or related to the Lawson Entities’ business which are or were created, developed, generated or held by Executive during employment, whether containing or relating to Confidential Information or not, are the property of the Lawson Entities and shall be promptly delivered to the Company upon termination of Executive’s employment for any reason whatsoever.  During the course of employment, Executive shall not remove any of the above property, including but not limited to, Confidential Information, or reproductions or copies thereof, or any apparatus containing any such property or Confidential Information, from the Company’s premises without prior written authorization from the Company, other than in the normal execution of Executive’s duties.
(e)    Assignment of Intellectual Property Rights.  Executive agrees to assign to the Company any and all intellectual property rights including patents, trademarks, copyrights and business plans or systems developed, authored or conceived by Executive, whether alone or jointly, while employed by and relating to the business of the Lawson Entities.  Executive agrees to cooperate with the Company to perfect ownership rights thereof in the Company.  This agreement does not apply to an invention for which no equipment, supplies, facility or Confidential Information was used and which was developed entirely on Executive’s own time, unless:  (1) the invention relates to the business of the Lawson Entities or to actual or anticipated research or development of the Lawson Entities; or (2) the invention results from any work performed by Executive for the Lawson Entities.

(f)    Unfair Trade Practices.  During the term of this Agreement and at all times thereafter, Executive shall not, directly or indirectly, engage in or assist others in engaging in any unfair trade practices with respect to the Lawson Entities.

(g)    Remedies.  Executive acknowledges that failure to comply with the terms of this Section 7 will cause irreparable loss and damage to Company.  Therefore, Executive agrees that, in addition and cumulative to any other remedies at law or equity available to the Company for Executive’s breach or threatened breach of this Agreement, the Company is entitled to specific performance or injunctive relief against Executive to prevent such damage or breach, and a temporary restraining order and preliminary injunction may be granted to the Company for this purpose immediately at its request upon commencement of any suit, without prior notice and without posting any bond.  The existence of any claim or cause of action Executive may have against the Company will not constitute a defense thereto.  In addition, the Company will be relieved of any obligation to provide to Executive any and all termination payments and benefits (excepting Accrued Compensation) which would otherwise accrue, be continued, or become due and payable under this Agreement following such breach or threatened breach, except that such payments and benefits shall accrue during the period of alleged threatened breach or alleged breach and shall be due and payable to Executive immediately upon either (a) a determination by the Company or arbitrator or court, or (b) agreement of the parties, that Executive was not in breach.  Each party agrees that all remedies expressly provided for in this Agreement are cumulative of any and all other remedies now existing at law or in equity.  In addition to the remedies provided in this Agreement, the parties will be entitled to avail themselves of all such other remedies as may now or hereafter exist at law or in equity for compensation, and for the specific enforcement of the covenants contained in this Agreement.  Resort to any remedy provided for in this Section 7 or provided for by law will not prevent the concurrent or subsequent employment of any other appropriate remedy or remedies, or preclude a recovery of monetary damages and compensation.  Each party agrees that no party hereto shall be required to post a bond or other security to seek an injunction.  In the event that a court of competent jurisdiction declares that any of the remedies outlined in this Section 7(g) are unavailable as a matter of law, the remainder of the remedies outlined in this Section 7(g) shall remain available to the Company.

(h)    Enforceability.  If any of the provisions of this Section 7 are deemed by a court or arbitrator having jurisdiction to exceed the time, geographic area or activity limitations the law permits, the limitations will be reduced to the maximum permissible limitation, and Executive and the Company authorize a court or arbitrator having jurisdiction to reform the provisions to the maximum time, geographic area and activity limitations the law permits; provided, however, that such reductions apply only with respect to the operation of such provision in the particular jurisdiction in which such adjudication is made.

(i)    Sufficiency of Consideration.  Executive acknowledges that the consideration that Executive will receive pursuant to this Agreement serves as sufficient consideration for Executive’s promises to abide by the restrictive covenants set forth in this Section 7.

8.    Governing Law and Disputes.

(a)    This Agreement shall be interpreted and enforced in accordance with the laws of the State of Illinois, without regard to its conflict of law principles.

(b)    The Company and Executive agree to attempt to resolve any employment related dispute between them quickly and fairly, and in good faith.  Should such a dispute remain unresolved, the Company and Executive irrevocably and unconditionally agree to submit to the exclusive jurisdiction of the courts of the State of Illinois and of the United States located in Chicago, Illinois over any suit, action or 

proceeding arising out of or relating to this Agreement.  The Company and Executive irrevocably and unconditionally agree to personal jurisdiction and venue of any such suit, action or proceeding in the courts of the State of Illinois or of the United States located in Chicago, Illinois.

9.    Cooperation After Termination of Employment.  Following the termination of Executive’s employment by the Company, regardless of the reason for termination, Executive will reasonably cooperate with the Company and Parent in the prosecution or defense of any claims, controversies, suits, arbitrations or proceedings involving events occurring prior to the termination of this Agreement.  Executive acknowledges that in light of his position as President and Chief Executive Officer of the Company and Parent, he is in the possession of Confidential Information that may be privileged under the attorney-client and/or work product privileges.  Executive agrees to maintain the confidences and privileges of the Company and Parent and acknowledges that any such confidences and privileges belong solely to the Company and Parent and can only be waived by the Company or Parent, as applicable, not Executive.  In the event Executive is subpoenaed to testify or otherwise requested to provide information in any matter, including without limitation, any court action, administrative proceeding or government audit or investigation, relating to the Company or Parent, Executive agrees that: (a) he will promptly notify the Company and Parent of any subpoena, summons or other request to testify or to provide information of any kind no later than three (3) days after receipt of such subpoena, summons or request and, in any event, prior to the date set for him to provide such testimony or information; (b) he will cooperate with the Company and Parent with respect to such subpoena, summons or request for information; (c) he will not voluntarily provide any testimony or information without permission of the Company unless otherwise required by law; and (d) he will permit the Company to be represented by an attorney of the Company’s choosing at any such testimony or with respect to any such information to be provided, and will follow the instructions of the attorney designated by the Company with respect to whether testimony or information is privileged by the attorney-client and/or work product privileges of the Company or Parent, unless otherwise required by law.  The parties agree that the Company shall be responsible for all reasonable expenses of Executive incurred in connection with the fulfillment of Executive’s obligations under this Section 9.  The parties agree and acknowledge that nothing in this Section 9 is meant to preclude Executive from fully and truthfully cooperating with any government investigation.

10.    Miscellaneous.

(a)    Superseding Effect.  This Agreement supersedes all prior or contemporaneous negotiations, commitments, agreements, and writings, including without limitation the Employment Agreement, dated as of October 16, 2012, between the Company and Executive, and expresses the entire agreement between the parties with respect to Executive’s employment by the Company; provided, however, that the terms of any Benefit Plans will remain applicable to the particular Benefit Plan, except as expressly modified herein.  All such other negotiations, commitments, agreements and writings will have no further force or effect, and the parties to any such other negotiation, commitment, agreement or writing will have no further rights or obligations thereunder.  The parties agree and acknowledge that the definitions of terms applicable to this Agreement may be different than the definitions of those same terms in Benefit Plans and may result in seemingly contradictory results.  For example, a change in control under this Agreement may not constitute a change in control under the LTIP.  The parties agree and acknowledge that such seemingly contradictory results are intended, and that this Agreement shall be governed solely by the terms and definitions set forth herein and that the Benefit Plans shall be governed solely by the terms and definitions set forth in the Benefit Plans, except as expressly modified herein.

(b)    Amendment and Modification.  Except as provided in Section 10(c), neither Executive nor the Company may modify, amend or waive the terms of this Agreement other than by a written instrument 

signed by Executive and the Company.  Either party’s waiver of the other party’s compliance with any specific provision of this Agreement is not a waiver of any other provision of this Agreement or of any subsequent breach by such party of a provision of this Agreement.  No delay on the part of any party in exercising any right, power or privilege hereunder will operate as a waiver thereof.

(c)    Section 409A.  It is also the intention of this Agreement that all income tax liability on payments made pursuant to this Agreement or any Benefit Plans be deferred until Executive actually receives such payment to the extent Code Section 409A applies to such payments, and this Agreement shall be interpreted in a manner consistent with this intent.  Therefore, if any provision of this Agreement or any Benefit Plans is found not to be in compliance with any applicable requirements of Code Section 409A, that provision will be deemed amended and will be construed and administered, insofar as possible, so that this Agreement and any Benefit Plans, to the extent permitted by law and deemed advisable by the Company, do not trigger taxes and other penalties under Code Section 409A; provided, however, that Executive will not be required to forfeit any payment otherwise due without his written consent.  In the event that, despite the parties’ intentions, any amount hereunder becomes taxable prior to the date that it would otherwise be paid, the Company shall pay to the Executive (which payment may be made in whole or in part by way of direct remittance to appropriate tax authorities) the portion of such amount needed to pay applicable income and excise taxes and any interest or other penalties on such amounts.  Any remaining portion of such amount shall be paid to Executive at the time otherwise specified in this Agreement, subject to Section 5(f).

  Solely for purposes of determining the time and form of payments due under this Agreement or otherwise in connection with his termination of employment with the Company and that are subject to Code Section 409A, Executive shall not be deemed to have incurred a termination of employment unless and until he shall incur a “separation from service” within the meaning of Code Section 409A.  It is intended that each payment or installment of a payment and each benefit provided under this Agreement shall be treated as a separate “payment” for purposes of Code Section 409A.  All reimbursements and in-kind benefits provided under the Agreement shall be made or provided in accordance with the requirements of Code Section 409A to the extent that such reimbursements or in-kind benefits are subject to Code Section 409A, including, where applicable, the requirements that (i) any reimbursement is for expenses incurred during Executive’s lifetime (or during a shorter period of time specified in this Agreement), (ii) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year (except that a plan providing medical or health benefits may impose a generally applicable limit on the amount that may be reimbursed or paid), (iii) the reimbursement of an eligible expense will be made on or before the last day of the calendar year following the year in which the expense is incurred and (iv) the right to reimbursement is not subject to set off or liquidation or exchange for any other benefit.
Nothing in this Section 10(c) increases the Company’s obligations to Executive under this Agreement or any Benefit Plans.  Executive remains solely liable for any taxes, including but not limited to any penalties or interest due to Code Section 409A or otherwise, on the payments made hereunder or under any Benefit Plans.  The preceding provisions shall not be construed as a guarantee by the Company of any particular tax effect for payments made pursuant to this Agreement or any Benefit Plans.
(d)    Parachute Payments.  Notwithstanding anything to the contrary herein or in any Benefit Plan, in the event it shall be determined that any monetary amounts or benefits due or payable by the Company to Executive (whether paid or payable, or due or distributed) are or will become subject to any excise tax under Section 4999 of the Code (collectively “Excise Taxes”), then the amounts or benefits otherwise due or payable to Executive pursuant to this Agreement or any Benefit Plans shall be reduced to the extent necessary so that no portion of such amounts or benefits shall be subject to the Excise Taxes, but only if (i) the net amount of such amounts and benefits, as so reduced (and after the imposition of the total amount of 

taxes under federal, state and local law on such amounts and benefits), is greater than (ii) the excess of (A) the net amount of such amounts and benefits, without reduction (but after imposition of the total amount of taxes under federal, state and local law) over (B) the amount of Excise Taxes to which Executive would be subject on such unreduced amounts and benefits.

If it is determined that Excise Taxes will or might be imposed on Executive in the absence of such reduction, the Company and Executive shall make good faith efforts to seek to identify and pursue reasonable action to avoid or reduce the amount of Excise Taxes; provided, however, that this sentence shall not be construed to require Executive to accept any further reduction in the amount or benefits that would be payable to him in the absence of this sentence.  The provisions of this Section 10(d) shall override and control any inconsistent provision in the LTIP.
All determinations required to be made under this Section 10(d), including whether reduction is required, the amount of such reduction and the assumptions to be utilized in arriving at such determination, shall be made in good faith by an independent accounting firm selected by the Company in accordance with applicable law (the “Accounting Firm”), in consultation with tax counsel reasonably acceptable to Executive.  All fees and expenses of the Accounting Firm shall be borne solely by the Company.  If the Accounting Firm determines that no excise tax under Section 4999 of the Code is payable by Executive, the Company shall request that the Accounting Firm furnish Executive with written guidance that failure to report such excise tax on Executive’s applicable federal income tax return would not result in the imposition of a negligence or similar penalty.
(e)    Withholding.  The Company will reduce its compensatory payments to Executive hereunder for withholding and FICA and Medicare taxes and any other withholdings and contributions required by law.

(f)    Severability.  If the final determination of an arbitrator or a court of competent jurisdiction declares, after the expiration of the time within which judicial review (if permitted) of such determination may be perfected, that any term or provision of this Agreement is invalid or unenforceable, the remaining terms and provisions will be unimpaired, and the invalid or unenforceable term or provision will be deemed replaced by a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision.  Any prohibition or finding of unenforceability as to any provision of this Agreement in any one jurisdiction will not invalidate or render unenforceable such provision in any other jurisdiction. 

(g)    Mitigation.  Executive shall not be required to seek employment or otherwise mitigate Executive’s damages in order to be entitled to the benefits and payments to which Executive is entitled under this Agreement.

(h)    Expenses.  Each of the Company and Executive will bear its own expenses in connection with the negotiation of this Agreement and the resolution of any disputes hereunder.

(i)    Binding Agreement; Assignment.  The Agreement is binding upon and shall inure to the benefit of Executive’s heirs, executors, administrators or other legal representatives, upon the successors of the Company and upon any entity into which the Company merges or consolidates.  The Company shall assign or otherwise transfer this Agreement and all of its rights, duties, obligations or interests under it or to any successor to all or substantially all of its assets.  Upon such assignment or transfer, any such successor will be deemed to be substituted for the Company for all purposes.  Executive may not assign or delegate the obligations of Executive under this Agreement.

(j)    Interpretation.  This Agreement will be interpreted without reference to any rule or precept of law that states that any ambiguity in a document be construed against the drafter.

(k)    Executive Acknowledgment.  Executive acknowledges that Executive has read and understands this Agreement and is entering into this Agreement knowingly and voluntarily.

(l)    Continuing Obligations.  Notwithstanding the termination of Executive’s employment hereunder for any reason or anything in this Agreement to the contrary, all post-employment rights and obligations of the parties, including but not limited to those set forth in Sections 5, 7, 8,  and 9, and any provisions necessary to interpret or enforce those rights and obligations under any provision of this Agreement, will survive the termination or expiration of this Agreement and remain in full force and effect for the applicable periods.
    
(m)    Descriptive Headings.  The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.

(n)    Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

(o)    Notice.  Any notice by any party to the other party must be mailed by registered or certified mail, postage prepaid, to the address specified below, or to any change of address indicated by either party upon receipt of written notice of same:

Michael G. DeCata 
At the address on file with the Company
Lawson Products, Inc. 
8770 W. Bryn Mawr Avenue
Suite 900
Chicago, IL 60631
Attention:  General Counsel

Notice will be deemed received on the third business day following the day on which it was mailed, postage prepaid.
[SIGNATURE LINES ON NEXT PAGE]

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

EXECUTIVE:

                    
/s/ Michael G. DeCata            
Michael G. DeCata

LAWSON PRODUCTS, INC.

By: /s/ Neil E. Jenkins                            
Neil E. Jenkins
Executive Vice President, General Counsel and Secretary

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