Document:

<PAGE>

                                                                    EXHIBIT 10.2

                           FORM OF ADVISORY AGREEMENT

      This ADVISORY AGREEMENT (this "AGREEMENT") is entered into on this the
____ day of _____________ , 2005, by and between COLE CREDIT PROPERTY TRUST II,
INC., a Maryland corporation (the "COMPANY"), and COLE REIT ADVISORS II, LLC, a
Delaware limited liability company (the "ADVISOR").

                               W I T N E S S E T H

      WHEREAS, the Company intends to issue shares of its common stock, par
value $.01, to the public, upon registration of such shares with the Securities
and Exchange Commission pursuant to the Securities Act of 1933, as amended;

      WHEREAS, the Company intends to qualify as a real estate investment trust
and to invest its funds in investments permitted by the terms of the Company's
Articles of Incorporation and Sections 856 through 860 of the Internal Revenue
Code;

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

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

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

                                   ARTICLE I

                                   DEFINITIONS

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

ACQUISITION EXPENSES. Any and all expenses incurred by the Company, the Advisor,
or any Affiliate of either in connection with the selection, acquisition or
development of any Asset, whether or not acquired, including, without
limitation, legal fees and expenses, travel and communications expenses, costs
of appraisals, nonrefundable option payments on property not acquired,
accounting fees and expenses, and title insurance premiums.

ACQUISITION FEES. Any and all fees and commissions, exclusive of Acquisition
Expenses but including the Acquisition and Advisory Fees, 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 making or investing in
Mortgages or the purchase, development or construction of an Asset, including,
without limitation, real estate commissions, selection fees, Development Fees,
Construction Fees, non-recurring management fees, loan fees, points or any other
fees of a similar nature. Excluded shall be Development Fees and Construction
Fees paid to any Person not affiliated with the Sponsor in connection with the
actual development and construction of any Property.

ACQUISITION AND ADVISORY FEES. The fees payable to the Advisor pursuant to
Section 3.01(b).

<PAGE>

ADVISOR. Cole REIT Advisors II, LLC, a Delaware limited liability company, any
successor advisor to the Company, or any Person to which Cole REIT Advisors II,
LLC, or any successor advisor subcontracts all or substantially all of its
functions.

AFFILIATE OR AFFILIATED. As to any Person, (i) any Person directly or indirectly
owning, controlling, or holding, with the power to vote, 10% or more of the
outstanding voting securities of such Person; (ii) any Person 10% or more of
whose outstanding voting securities are directly or indirectly owned,
controlled, or held, with power to vote, by such other Person; (iii) any Person,
directly or indirectly, controlling, controlled by, or under common control with
such Person; (iv) any executive officer, director, trustee or general partner of
such Person; and (v) any legal entity for which such Person acts as an executive
officer, director, trustee or general partner.

AGGREGATE ASSETS VALUE. The aggregate book value of the Assets at the time of
measurement before deducting depreciation, bad debts or other similar non-cash
reserves and without reduction for any debt secured by or relating to such
assets; provided, however, that during such periods in which the Board of
Directors is determining on a regular basis the current value of the Company's
net assets for purposes of enabling fiduciaries of employee benefit plan
stockholders to comply with applicable Department of Labor reporting
requirements, "Aggregate Assets Value" will equal the greater of (i) the amount
determined pursuant to the foregoing or (ii) the most recent Assets' aggregate
valuation established by the Board of Directors without reduction for
depreciation, bad debts or other non-cash reserves and without reduction for any
debt secured by or relating to such assets.

APPRAISED VALUE. Value according to an appraisal made by an Independent
Appraiser.

ARTICLES OF INCORPORATION. The Articles of Incorporation of the Company filed
with the Maryland State Department of Assessments and Taxation in accordance
with the Maryland General Corporation Law, as amended from time to time.

ASSETS. Properties, Mortgages and other direct or indirect investments in equity
interests in, or loans secured by, Real Property (other than investments in bank
accounts, money market funds or other current assets, whether of the proceeds
from an Offering or the sale of an Asset or otherwise) owned by the Company,
directly or indirectly through one or more of its Affiliates.

ASSET MANAGEMENT FEE. The fee payable to the Advisor for day-to-day professional
management services in connection with the Company and its investments in Assets
pursuant to this Agreement.

AVERAGE INVESTED ASSETS. For a specified period, the average of the aggregate
book value of the Assets, before deducting depreciation, 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; provided, however, that during such
periods in which the Board is determining on a regular basis the current value
of the Company's net assets for purposes of enabling fiduciaries of employee
benefit plan stockholders to comply with applicable Department of Labor
reporting requirements, "Average Invested Assets" will equal the greater of (i)
the amount determined pursuant to the foregoing or (ii) the most recent Assets'
aggregate valuation established by the Board of Directors without reduction for
depreciation, bad debts or other non-cash reserves.

BOARD OF DIRECTORS. The Board of Directors of the Company.

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

                                       -2-
<PAGE>

CHANGE OF CONTROL. Any event (including, without limitation, issue, transfer or
other disposition of Shares of capital stock of the Company or equity interests
in the Partnership, merger, share exchange or consolidation) after which any
"person" (as that term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended) is or becomes the "beneficial owner" (as
defined in Rule 13d-j of the Securities Exchange Act of 1934, as amended),
directly or indirectly, of securities of the Company or the Partnership
representing greater than 50% or more of the combined voting power of the
Company's or the Partnership's then outstanding securities, respectively;
provided, that, a Change of Control shall not be deemed to occur as a result of
any widely distributed public offering of the Shares.

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

COMPANY. Cole Credit Property Trust II, Inc., a corporation organized under the
laws of the State of Maryland.

COMPETITIVE REAL ESTATE COMMISSION. A real estate or brokerage commission paid
or, if no such commission is paid, the amount that customarily would be paid,
for the purchase or sale of a Property which is reasonable, customary, and
competitive in light of the size, type and location of the Property.

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

CONTRACT PURCHASE PRICE. The amount actually paid or allocated in respect of the
purchase, development, construction or improvement of an Asset or the amount of
funds advanced with respect to a Mortgage, exclusive of Acquisition Fees and
Acquisition Expenses.

CONTRACT SALES PRICE. The total consideration provided for in the sales contract
for the sale of a Property.

DEALER MANAGER. Cole Capital Corporation, an Affiliate of the Advisor, or such
Person selected by the Board of Directors to act as the dealer manager for an
Offering.

DEVELOPMENT FEE. A fee for the packaging of a Property or Mortgage, including
the negotiation and approval of plans, and any assistance in obtaining zoning
and necessary variances and financing for a specific Property, either initially
or at a later date.

DIRECTOR. A member of the Board of Directors.

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

FINANCE COORDINATION FEE. The fees payable to the Advisor pursuant to Section
3.01(g).

GROSS PROCEEDS. The aggregate purchase price of all Shares sold for the account
of the Company through an Offering, without deduction for Selling Commissions,
volume discounts, dealer manager fees, or Organization and Offering Expenses.
For the purpose of computing Gross Proceeds, the purchase price of any Share for
which reduced Selling Commissions or dealer manager fees are paid to the Dealer
Manager or a Soliciting Dealer (where net proceeds to the Company are not
reduced) shall be deemed to

                                       -3-
<PAGE>

be the full amount of the Offering price per Share pursuant to the prospectus
for such Offering without reduction.

INDEPENDENT APPRAISER. A Person with no material current or prior business or
personal relationship with the Advisor or the Directors and who is a qualified
appraiser of Real Property of the type held by the Company or of other Assets as
determined by the Board of Directors. 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 as to Real Property.

INDEPENDENT DIRECTOR. A Director who is not on the date of determination, and
within the last two years from the date of determination has not been, directly
or indirectly associated with the Sponsor, the Company, the Advisor or any of
their Affiliates by virtue of (i) ownership of an interest in the Sponsor, the
Company, the Advisor or any of their Affiliates, other than the Company, (ii)
employment by the Sponsor, the Advisor or any of their Affiliates, (iii) service
as an officer or director of the Sponsor, the Advisor or any of their
Affiliates, other than as a Director of the Company, or of any other real estate
investment trust organized by the Sponsor or advised by the Advisor, (iv)
performance of services, other than as a Director of the Company, (v) service as
a director or trustee of more than three real estate investment trusts organized
by the Sponsor or advised by the Advisor, or of any other real estate investment
trust organized by the Sponsor or advised by the Advisor, or (vi) maintenance of
a material business or professional relationship with the Sponsor, the Advisor
or any of their Affiliates. A business or professional relationship is
considered material if the aggregate gross revenue derived by the Director from
the Sponsor, the Advisor and their Affiliates exceeds 5.0% of either the
Director's annual gross income during either of the last two years or the
Director's net worth on a fair market value basis. An indirect association with
the Sponsor or the Advisor shall include circumstances in which a Director's
spouse, parent, child, sibling, mother- or father-in-law, son- or
daughter-in-law, or brother- or sister-in-law is or has been associated with the
Sponsor, the Advisor, any of their Affiliates, or the Company.

INVESTED CAPITAL. The amount calculated by multiplying the total number of
Shares purchased by Stockholders by the issue price, reduced by the portion of
any Dividend that is attributable to Net Sales Proceeds and by any amounts paid
by the Company to repurchase Shares pursuant to the Company's plan for
repurchase of Shares.

JOINT VENTURES. The joint venture or partnership arrangements in which the
Company or the Partnership is a co-venturer or general partner which are
established to acquire or hold Assets.

LISTING OR LISTED. The listing of the Shares on a national securities exchange
or the quotation of Shares on The Nasdaq Stock Market. Upon such Listing, the
Shares shall be deemed Listed.

MARKET VALUE. Upon Listing, the market value of the outstanding Shares, measured
by taking the average closing price or average of bid and asked price, as the
case may be, over a period of 30 days during which the Shares are traded, with
such period beginning 180 days after Listing.

MORTGAGES. In connection with mortgage financing provided, invested in or
purchased by the Company, all of the notes, deeds of trust, security interests
or other evidences of indebtedness or obligations, which are secured or
collateralized by Real Property owned by the borrowers under such notes, deeds
of trust, security interests or other evidences of indebtedness or obligations.

NASAA GUIDELINES. The Statement of Policy Regarding Real Estate Investment
Trusts of the North American Securities Administrators Association, Inc.

                                       -4-
<PAGE>

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

NET SALES PROCEEDS. In the case of a transaction described in clause (A) of the
definition of Sale, the proceeds of any such transaction less the amount of
selling expenses incurred by or on behalf of the Company, including all real
estate commissions, closing costs and legal fees and expenses. In the case of a
transaction described in clause (B) of such definition, Net Sales Proceeds means
the proceeds of any such transaction less the amount of selling expenses
incurred by or on behalf of the Company, including any legal fees and expenses
and other selling expenses incurred in connection with such transaction. In the
case of a transaction described in clause (C) of such definition, Net Sales
Proceeds means the proceeds of any such transaction actually distributed to the
Company from the Joint Venture less the amount of any selling expenses,
including legal fees and expenses incurred by or on behalf of the Company (other
than those paid by the Joint Venture). In the case of a transaction or series of
transactions described in clause (D) of the definition of Sale, Net Sales
Proceeds means the proceeds of any such transaction (including the aggregate of
all payments under a Mortgage or in satisfaction thereof other than regularly
scheduled interest payments) less the amount of selling expenses incurred by or
on behalf of the Company, including all commissions, closing costs and legal
fees and expenses. In the case of a transaction described in clause (E) of such
definition, Net Sales Proceeds means the proceeds of any such transaction less
the amount of selling expenses incurred by or on behalf of the Company,
including any legal fees and expenses and other selling expenses incurred in
connection with such transaction. In the case of a transaction described in the
last sentence of the definition of Sale, Net Sales Proceeds means the proceeds
of such transaction or series of transactions less all amounts generated thereby
which are reinvested in one or more Assets within 180 days thereafter and less
the amount of any real estate commissions, closing costs, and legal fees and
expenses and other selling expenses incurred by or allocated to the Company in
connection with such transaction or series of transactions. Net Sales Proceeds
shall also include any consideration (including non-cash consideration such as
stock, notes, or other property or securities) that the Company determines, in
its discretion, to be economically equivalent to proceeds of a Sale, valued in
the reasonable determination of the Company. Net Sales Proceeds shall not
include any reserves established by the Company in its sole discretion.

OFFERING. Any public offering and sale of Shares pursuant to an effective
registration statement filed under the Securities Act, excluding Shares offered
under any employee benefit plan.

OPERATING EXPENSES. All costs and expenses paid or incurred by the Company, as
determined under generally accepted accounting principles, which are in any way
related to the operation of the Company or to Company business, including the
Asset Management Fee, but excluding (i) the expenses of raising capital such as
Organization and Offering Expenses, legal, audit, accounting, underwriting,
brokerage, listing, registration, and other fees, printing and other such
expenses and tax incurred in connection with the issuance, distribution,
transfer, registration and Listing of the Shares, (ii) interest payments, (iii)
taxes, (iv) non-cash expenditures such as depreciation, amortization and bad
debt reserves, (v) the Subordinated Share of Net Sales Proceeds, (vi) the
Performance Fee, (vii) the Subordinated Incentive Listing Fee, (viii)
Acquisition Fees and Acquisition Expenses, (ix) real estate commissions on the
Sale of Property, and (x) other fees and expenses connected with the
acquisition, disposition, management and ownership of real estate interests,
mortgage loans or other property (including the costs of foreclosure, insurance
premiums, legal services, maintenance, repair and improvement of property).

ORGANIZATION AND OFFERING EXPENSES. All expenses incurred by, and to be paid
from, the assets of the Company in connection with and in preparing the Company
for registration of and subsequently offering and distributing its Shares to the
public, which may include, but are not limited to, total underwriting and
brokerage discounts and commissions (including fees of the underwriters'
attorneys); expenses for

                                       -5-
<PAGE>

printing, engraving and mailing; salaries of employees while engaged in sales
activities; charges of transfer agents, registrars, trustees, escrow holders,
depositaries and experts; and expenses of qualification of the sale of the
securities under federal and state laws, including taxes and fees, accountants'
and attorneys' fees.

PARTNERSHIP. Cole Operating Partnership II, LP, a Delaware limited partnership,
through which the Company may own Assets.

PERFORMANCE FEE. The fee payable to the Advisor upon termination of this
Agreement under certain circumstances if certain performance standards have been
met pursuant to Section 4.03(b) or (c).

PERSON. An individual, corporation, business trust, estate, trust, partnership,
limited liability company or other legal entity.

PROPERTY OR PROPERTIES. As the context requires, any, or all, respectively, of
the Real Property acquired by the Company, either directly or indirectly
(whether through joint venture arrangements or other partnership or investment
interests).

PROSPECTUS. Prospectus has the meaning set forth in Section 2(10) of the
Securities Act, including a preliminary prospectus, an offering circular as
described in Rule 256 of the General Rules and Regulations under the Securities
Act or, in the case of an intrastate offering, any document by whatever name
known, utilized for the purpose of offering and selling securities of the
Company to the public.

REAL ESTATE COMMISSION. The fee payable to the Advisor for services provided in
connection with the Sale of one or more Properties pursuant to Section 3.01(c).

REAL PROPERTY. Land, rights in land (including leasehold interests), and any
buildings, structures, improvements, furnishings, fixtures and equipment located
on or used in connection with land and rights or interests in land.

REIT. A corporation, trust, association or other legal entity (other than a real
estate syndication) that is engaged primarily in investing in equity interests
in real estate (including fee ownership and leasehold interests) or in loans
secured by real estate or both in accordance with Sections 856 through 860 of
the Code.

SALE OR SALES. Any transaction or series of transactions whereby: (A) the
Company or the Partnership directly or indirectly (except as described in other
subsections of this definition) sells, grants, transfers, conveys, or
relinquishes its ownership of any Property or portion thereof, including the
lease of any Property consisting of a 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 Company or the Partnership
directly or indirectly (except as described in other subsections of this
definition) sells, grants, transfers, conveys, or relinquishes its ownership of
all or substantially all of the interest of the Company or the Partnership in
any Joint Venture in which it is a co-venturer or partner; (C) any Joint Venture
directly or indirectly (except as described in other subsections of this
definition) in which the Company or the Partnership as 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 Company or the
Partnership directly or indirectly (except as described in other subsections of
this definition) sells, grants, conveys or relinquishes its interest in any
Mortgage or portion thereof (including with respect to any Mortgage, all
repayments thereunder or in satisfaction thereof other than regularly scheduled
interest payments) and any event with respect to a Mortgage which gives rise to
a significant amount of insurance proceeds or similar awards; or

                                       -6-
<PAGE>

(E) the Company or the Partnership directly or indirectly (except as described
in other subsections of this definition) sells, grants, transfers, conveys, or
relinquishes its ownership of any other Asset not previously described in this
definition or any portion thereof. Notwithstanding the foregoing, "Sale" or
"Sales" shall not include any transaction or series of transactions specified in
clause (A) through (E) above in which the proceeds of such transaction or series
of transactions are reinvested in one or more Assets within 180 days thereafter.

SECURITIES ACT. The Securities Act of 1933, as amended from time to time, or any
successor statute thereto. Reference to any provision of the Securities Act
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.

SELLING COMMISSIONS. Any and all commissions payable to underwriters, dealer
managers or other broker-dealers in connection with the sale of the Shares,
including, without limitation, commissions payable to Cole Capital Corporation.

SHARES. Any Shares of the Company's common stock, par value $.01 per share.

SOLICITING DEALERS. Broker-dealers who are members of the National Association
of Securities Dealers, Inc., or that are exempt from broker-dealer registration,
and who, in either case, have executed participating broker or other agreements
with the Dealer Manager to sell Shares.

SPONSOR. Cole Holdings Corporation.

STOCKHOLDERS. The record holders of the Shares as maintained in the books and
records of the Company or its transfer agent.

STOCKHOLDERS' 8.0% RETURN. As of any date, an aggregate amount equal to an 8.0%
cumulative, noncompounded, annual return on Invested Capital.

SUBORDINATED INCENTIVE LISTING FEE. The fee payable to the Advisor under certain
circumstances if the Shares are Listed pursuant to Section 3.01(e).

SUBORDINATED SHARE OF NET SALES PROCEEDS. The fee payable to the Advisor under
certain circumstances following receipt of Net Sales Proceeds pursuant to
Section 3.01(d).

TERMINATION DATE. The date of termination of this Agreement.

2%/25% GUIDELINES. The requirement pursuant to the Statement of Policy Regarding
Real Estate Investment Trusts of the North American Securities Administrators
Association, Inc. that, in any 12 month period, total Operating Expenses not
exceed the greater of 2% of Average Invested Assets during such 12 month period
or 25% of Net Income over the same 12 month period.

                                   ARTICLE II

                                   THE ADVISOR

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

                                       -7-
<PAGE>

2.02 DUTIES OF THE ADVISOR. The Advisor undertakes to use its commercially
reasonable best efforts to present to the Company potential investment
opportunities and to provide a continuing and suitable investment program
consistent with the investment objectives and policies of the Company as
determined and adopted from time to time by the Board of Directors. In
performance of this undertaking, subject to the supervision of the Board of
Directors and consistent with the provisions of the Company's most recent
Prospectus for Shares, Articles of Incorporation and Bylaws, the Advisor shall,
either directly or by engaging an Affiliate of the Advisor or other Person:

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

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

      (c) maintain and preserve the books and records of the Company, including
stock books and records reflecting a record of the Stockholders and their
ownership of the Company's uncertificated Shares, if any, and acting as transfer
agent for the Shares;

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

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

      (f) subject to the provisions of Sections 2.02(i) and 2.03 hereof, (i)
locate, analyze and select potential investments in Assets, (ii) structure and
negotiate the terms and conditions of transactions pursuant to which investment
in Assets will be made; (iii) make investments in Assets on behalf of the
Company or the Partnership in compliance with the investment objectives and
policies of the Company; (iv) arrange for financing and refinancing and make
other changes in the asset or capital structure of, and dispose of, reinvest the
proceeds from the sale of, or otherwise deal with the investments in, Assets;
and (v) enter into leases of Property and service contracts for Assets and, to
the extent necessary, perform all other operational functions for the
maintenance and administration of such Assets, including the servicing of
Mortgages;

      (g) provide the Board of Directors with periodic reports regarding
prospective investments in Assets;

      (h) if a transaction requires approval by the Board of Directors, deliver
to the Board of Directors all documents required by them to properly evaluate
the proposed transaction;

                                       -8-
<PAGE>

      (i) obtain the prior approval of the Board of Directors (including a
majority of all Independent Directors) for any and all investments in Assets;

      (j) obtain the prior approval of a majority of the Independent Directors
and a majority of the Board of Directors not otherwise interested in any
transaction with the Advisor or its Affiliates;

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

      (l) obtain reports (which may be prepared by or for the Advisor or its
Affiliates), where appropriate, concerning the value of investments or
contemplated investments of the Company in Assets;

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

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

      (o) deliver to or maintain on behalf of the Company copies of all
appraisals obtained in connection with the investments in Assets;

      (p) upon request of the Company, act, or obtain the services of others to
act, as attorney-in-fact or agent of the Company in making, requiring and
disposing of Assets, disbursing, and collecting the funds, paying the debts and
fulfilling the obligations of the Company and handling, prosecuting and settling
any claims of the Company, including foreclosing and otherwise enforcing
mortgage and other liens and security interests comprising any of the Assets;

      (q) supervise the preparation and filing and distribution of returns and
reports to governmental agencies and to Stockholders and other investors and act
on behalf of the Company in connection with investor relations;

      (r) provide office space, equipment and personnel as required for the
performance of the foregoing services as Advisor;

      (s) prepare on behalf of the Company all reports and
returns required by the Securities and Exchange Commission, Internal Revenue
Service and other state or federal governmental agencies; and

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

2.03 MODIFICATION OR REVOCATION OF AUTHORITY OF ADVISOR. The Board of Directors
may, at any time upon the giving of notice to the Advisor, modify or revoke the
authority set forth in Section 2.02, provided however, that such modification or
revocation shall be effective upon receipt by the Advisor or such later date as
is specified by the Board of Directors and included in the notice provided to
the Company and such modification or revocation shall not be applicable to
investment transactions to which the Advisor has committed the Company prior to
the date of receipt by the Advisor of such notification, or, if later, the
effective date of such modification or revocation specified by the Board of
Directors.

                                       -9-
<PAGE>

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

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

2.06 LIMITATIONS ON ACTIVITIES. Anything else in this Agreement to the contrary
notwithstanding, the Advisor shall refrain from taking any action which, in its
sole judgment made in good faith, would (a) adversely affect the 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, the Shares or its other securities, or (d) not be permitted by the
Articles of Incorporation or Bylaws, except if such action shall be ordered by
the Board of Directors, in which case the Advisor shall notify promptly the
Board of Directors of the Advisor's judgment of the potential impact of such
action and shall refrain from taking such action until it receives further
clarification or instructions from the Board of Directors. In such event the
Advisor shall have no liability for acting in accordance with the specific
instructions of the Board of Directors so given. Notwithstanding the foregoing,
the Advisor, its directors, officers, employees and stockholders, and the
directors, officers, employees and stockholders of the Advisor's Affiliates
shall not be liable to the Company or to the Board of Directors or Stockholders
for any act or omission by the Advisor, its directors, officers, employees or
stockholders, or for any act or omission of any Affiliate of the Advisor, its
directors, officers, employees or stockholders, except as provided in Article V
of this Agreement.

2.07 OTHER ACTIVITIES OF THE ADVISOR. Nothing herein contained shall prevent the
Advisor or its Affiliates 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 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
Person. The Advisor may, with respect to any investment in which the Company is
a participant, also render advice and service to each and every other
participant therein. The Advisor shall report to the Board of Directors the
existence of any condition or circumstance, existing or anticipated, of which it
has knowledge, which creates or could create a conflict of interest between the
Advisor's obligations to the Company and its obligations to or its interest in
any other Person. The Advisor or its Affiliates shall promptly disclose to the
Board of Directors knowledge of such condition or circumstance. If the Sponsor,
Advisor, any Director or Affiliates thereof have sponsored other investment
programs with similar investment objectives which have investment funds
available at the same time as the Company, it shall be the duty of the Board of
Directors (including the Independent Directors) to adopt the method set forth in
the Company's most recent Prospectus for its Shares or another reasonable method
by which investments are to be allocated to the competing investment entities
and to use their best efforts to apply such method fairly to the Company.

                                      -10-
<PAGE>

                                   ARTICLE III

                                  COMPENSATION

3.01 FEES.

      (a) Asset Management Fee. The Company shall pay the Advisor a monthly
Asset Management Fee on or before the last day of each month in an amount equal
to 0.02083% of the Aggregate Assets Value as of the last day of the preceding
month.

      (b) Acquisition and Advisory Fees. The Company shall pay the Advisor or an
Affiliate a fee in the amount of 2.0% of the Contract Purchase Price of each
Asset as Acquisition and Advisory Fees payable at the time and in respect of
funds expended for (i) the acquisition of an Asset, (ii) to the extent that such
funds are capitalized, for the development, construction or improvement of an
Asset, or (iii) the making of a Mortgage. The total of all Acquisition Fees and
any Acquisition Expenses shall be limited in accordance with the Articles of
Incorporation.

      (c) Real Estate Commission. If the Advisor or an Affiliate provides a
substantial amount of the services (as determined by a majority of the
Independent Directors) in connection with the Sale of one or more Properties,
the Advisor or such Affiliate shall receive a Real Estate Commission up to
one-half of the brokerage commission paid, but in no event an amount to exceed
2.0% of the Contact Sales Price of such Property or Properties; provided,
however, that no Real Estate Commissions shall be payable to the Advisor for the
Sale of Properties if such Sales involve the Company selling all or
substantially all of its Properties in one or more transactions designed to
effectuate a business combination transaction (as opposed to a Company
liquidation, in which case the Real Estate Commissions would be payable if the
Advisor or an Affiliate provides a substantial amount of services as provided
above). The Real Estate Commission may be paid in addition to real estate
commissions paid to non-Affiliates, provided that the total real estate
commissions paid to all Persons by the Company (including the Real Estate
Commission) shall not exceed an amount equal to the lesser of (i) 6.0% of the
Contract Sales Price of a Property or (ii) the Competitive Real Estate
Commission.

      (d) Subordinated Share of Net Sales Proceeds. The Subordinated Share of
Net Sales Proceeds shall be payable to the Advisor in an amount equal to 10.0%
of Net Sales Proceeds remaining after the Stockholders have received Dividends
equal to the sum of the Stockholders' 8.0% Return and 100% of Invested Capital.
The Company shall have the option to pay such fee in the form of cash, Shares, a
promissory note, or any combination of the foregoing, or any combination of the
foregoing.
      (e) Subordinated Incentive Listing Fee. Upon Listing, the Advisor shall be
entitled to the Subordinated Incentive Listing Fee in an amount equal to 10.0%
of the amount by which (i) the Market Value plus the total of all Dividends paid
to Stockholders from the Company's inception until the date that Market Value is
determined, exceeds (ii) the sum of (A) 100% of Invested Capital and (B) the
total Dividends required to be paid to the Stockholders in order to pay the
Stockholders' 8.0% Return from inception through the date that Market Value is
determined. The Company shall have the option to pay such fee in the form of
cash, Shares, a promissory note, or any combination of the foregoing. If the
Company pays such fee with a promissory note, payment in full shall be made from
the Net Sales Proceeds of the first Sale completed by the Company after Listing,
and interest will accrue at a rate deemed fair and reasonable by the Board of
Directors from and after the date of Listing. If the Net Sales Proceeds from the
first Sale after Listing are insufficient to pay the promissory note in full,
including accrued interest, then the promissory note shall be paid in part with
such Net Sales Proceeds, and in part from the Net Sales Proceeds from the next
successive Sales until the amount owing pursuant to such promissory note is paid
in full. If the promissory note has not been paid in full within five years from
the
                                      -11-
<PAGE>

date of Listing, then the Advisor, or its successors or assigns, may elect to
convert the unpaid balance, including accrued but unpaid interest, into Shares
at a price per Share equal to the average closing price of the Shares over the
ten trading days immediately preceding the date of such election. If the Shares
are no longer Listed at such time as the promissory note becomes convertible
into Shares as provided by this paragraph, then the price per Share, for
purposes of conversion, shall equal the fair market value for the Shares as
determined by the Board of Directors based upon the Appraised Value of the
Assets as of the date of election.

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

      (g) Finance Coordination Fee. In the event of the origination or
refinancing of any debt financing obtained by the Company that is used to
acquire properties or to make other permitted investments, and if the Advisor
provides a substantial amount of services, as determined by the Independent
Directors in connection therewith, the Company will pay to the Advisor a
financing coordination fee equal to 1% of the amount available under such
financing; provided, however, that the Advisor shall not be entitled to a
Finance Coordination Fee in connection with the refinancing of any loan secured
by any particular property that was previously subject to a refinancing in which
the Advisor received a Finance Coordination Fee. Finance Coordination Fees
payable from loan proceeds from permanent financing will be paid to the Advisor
as the Company acquires such permanent financing, however, no finance
coordination fees will be paid from loan proceeds from any line of credit until
such time as all net offering proceeds have been invested by the Company.

3.02 EXPENSES.

      (a) In addition to the compensation paid to the Advisor pursuant to
Section 3.01 hereof, the Company shall pay directly or reimburse the Advisor, as
applicable, for all of the expenses paid or incurred by the Advisor in
connection with the services it provides to the Company pursuant to this
Agreement, including, but not limited to:

            (i) Organization and Offering Expenses; provided, however, that
            within 60 days after the end of the month in which an Offering
            terminates, the Advisor shall reimburse the Company for any
            Organization and Offering Expenses reimbursed by the Company to the
            Advisor to the extent that such reimbursement exceeds 1.5% of the
            Gross Proceeds raised in a completed Offering. The Advisor shall be
            responsible for the payment of Organization and Offering Expenses in
            excess of 1.5% of the Gross Proceeds;
            (ii) Acquisition Expenses incurred in connection with the selection
            and acquisition of Assets;

            (iii) the actual cost of goods, services and materials used by the
            Company and obtained from Persons not affiliated with the Advisor,
            other than Acquisition Expenses, including brokerage fees paid in
            connection with the purchase and sale of Shares;

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

            (v) taxes and assessments on income or property and taxes as an
            expense of doing business;

                                      -12-
<PAGE>

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

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

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

            (ix) expenses associated with Listing or with the issuance and
            distribution of Shares and other securities of the Company, such as
            Selling Commissions and fees, advertising expenses, taxes, legal and
            accounting fees, Listing and registration fees, and other
            Organization and Offering Expenses;

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

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

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

            (xiii) administrative service expenses, including all costs and
            expenses incurred by Advisor in fulfilling its duties hereunder.
            Such costs and expenses may include reasonable wages and salaries
            and other employee-related expenses of all employees of Advisor who
            are engage in the management, administration, operations, 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 hereunder; and

            (xiv) audit, accounting and legal fees.

      No reimbursement shall be made for costs of personnel of the Advisor or
its Affiliates to the extent that such personnel perform services in connection
with services for which the Advisor receives the Acquisition and Advisory Fee or
the Real Estate Commission.

      (b) Expenses incurred by the Advisor on behalf of the Company and payable
pursuant to this Section 3.02 shall be reimbursed no less than quarterly to the
Advisor within 60 days after the end of each quarter. The Advisor shall prepare
a statement documenting the expenses of the Company during each quarter, and
shall deliver such statement to the Company within 45 days after the end of each
quarter.

3.03 OTHER SERVICES. Should the Board of Directors request that the Advisor or
any director, officer or employee thereof render services for the Company other
than set forth in Section 2.02, such services shall be separately compensated at
such rates and in such amounts as are agreed by the Advisor and the Board of
Directors, subject to the limitations contained in the Articles of
Incorporation, and shall not be deemed to be services pursuant to the terms of
this Agreement.

                                      -13-
<PAGE>

3.04 REIMBURSEMENT TO THE ADVISOR. The Company shall not reimburse the Advisor
at the end of any fiscal quarter Operating Expenses to the extent 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 Net
Income (the "2%/25% Guidelines") for such year unless the Independent Directors
determine that such excess was justified, based on unusual and nonrecurring
factors which the Independent Directors deem sufficient. If the Independent
Directors do 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
the Independent Directors determine 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 2%/25% Guidelines,
the Advisor, at the direction of the Independent Directors, shall send to the
stockholders a written disclosure of such fact, together with an explanation of
the factors the Independent Directors considered in determining that such excess
expenses were justified. 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
generally accepted accounting principles applied on a consistent basis.

                                   ARTICLE IV

                              TERM AND TERMINATION

4.01 TERM; RENEWAL. Subject to Section 4.02 hereof, this Agreement shall
continue in force until the first anniversary of the date hereof. Thereafter,
this Agreement may be renewed for an unlimited number of successive one-year
terms upon mutual consent of the parties. It is the duty of the Board of
Directors to 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.

4.02 TERMINATION. This Agreement will automatically terminate upon Listing. This
Agreement also may be terminated at the option of either party (i) immediately
upon a Change of Control or (ii) upon 60 days written notice without cause or
penalty, by either party (in either case, if termination is by the Company, then
such termination shall be upon the approval of a majority of the Board of
Directors). Notwithstanding the foregoing, the provisions of this Agreement
which provide for payment to the Advisor of expenses, fees or other compensation
following the date of termination (i.e., Sections 3.01(e) and 4.03) shall
continue in full force and effect until all amounts payable thereunder to the
Advisor are paid in full. The provisions of Sections 2.05, 2.06 and 4.03 through
6.11 shall survive the termination of this Agreement.

4.03 PAYMENTS TO AND DUTIES OF ADVISOR UPON TERMINATION.

      (a) After the Termination Date, the Advisor shall not be entitled to
compensation for further services hereunder except it shall be entitled to and
receive from the Company within 30 days after the effective date of such
termination all unpaid reimbursements of expenses, subject to the provisions of
Section 3.04 hereof, and all contingent liabilities related to fees payable to
the Advisor prior to termination of this Agreement, provided that the
Subordinated Incentive Listing Fee, if any, shall be paid in accordance with the
provisions of Section 3.01(e).

      (b) Upon termination, unless such termination is by the Company because of
a material breach of this Agreement by the Advisor or occurs upon a Change of
Control, the Advisor shall be entitled to receive a payment of the Performance
Fee equal to 10.0% of the amount, if any, by which (i) the Appraised Value of
the Assets on the Termination Date, less the amount of all indebtedness secured
by the Assets, plus the total Dividends paid to Stockholders from the Company's
inception through the Termination Date, exceeds (ii) Invested Capital plus an
amount equal to the Stockholders' 8.0% Return
                                      -14-
<PAGE>

from inception through the Termination Date. The Company shall pay such
Performance Fee, with interest, at such time as the Company completes the first
Sale after the Termination Date. Payment shall be made from the Net Sales
Proceeds of such Sale. Interest will accrue beginning on the Termination Date at
a rate deemed fair and reasonable by the Board of Directors on the Termination
Date. The Company shall have the option to pay such fee in the form of cash,
Shares, a promissory note, or any combination of the foregoing. If the Net Sales
Proceeds from the first Sale after the Termination Date are insufficient to pay
the Performance Fee in full, plus accrued interest, then the Performance Fee
shall be paid in part with such Net Sales Proceeds, and in part from the Net
Sales Proceeds from the next successive Sales until the Performance Fee is paid
in full, with interest. If the Performance Fee has not been paid in full within
five years from the Termination Date, then the Advisor, its successors or
assigns, may elect to convert the balance of the fee, including accrued but
unpaid interest, into Shares at a price per Share equal to the average closing
price of the Shares over the ten trading days immediately preceding the date of
such election if the Shares are Listed at such time. If the Shares are not
Listed at such time, the Advisor, its successors or assigns, may elect to
convert the balance of the fee, including accrued but unpaid interest, into
Shares at a price per Share equal to the fair market value for the Shares as
determined by the Board of Directors based upon the Appraised Value of the
Assets on the date of election.

      (c) Notwithstanding the foregoing, if termination occurs upon a Change of
Control, the Advisor shall be entitled to payment of the Performance Fee equal
to 10.0% of the amount, if any, by which (i) the value of the Assets on the
Termination Date as determined in good faith by the Board of Directors,
including a majority of the Independent Directors, based upon such factors as
the consideration paid in connection with the Change of Control and the most
recent Appraised Value, less the amount of all indebtedness secured by the
Assets, plus the total Dividends paid to Stockholders from the Company's
inception through the Termination Date, exceeds (ii) Invested Capital plus an
amount equal to the Stockholders' 8.0% Return from inception through the
Termination Date. No deferral of payment of the Performance Fee may be made
under this Section 4.03(c).

      (d) In the event that the Advisor disagrees with the valuation of Shares
pursuant to Section 4.03(b) where the Shares are not Listed, or the value of the
Successor Shares pursuant to Section 4.03(c) where the Successor Shares are not
Listed, for purposes of determining the number of Shares to be issued to the
Advisor following the Advisor's election to convert the balance of the
Performance Fee owed to the Advisor, then the fair market value of such Shares
shall be determined by an independent appraiser of equity value selected by the
Advisor and the Successor. If the Advisor and the Successor are unable to agree
upon an expert independent appraiser, then each of the Successor and the Advisor
shall name one appraiser and the two named appraisers shall promptly agree in
good faith to the appointment of one such appraiser whose determination shall be
final and binding on the parties.

      (e) Notwithstanding Sections 4.03 (b) and (c), in the event the
Subordinated Incentive Listing Fee is paid to the Advisor following Listing, no
Performance Fee will be paid to the Advisor.

      (f) The Advisor shall promptly upon termination:

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

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

                                      -15-
<PAGE>

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

            (iv) cooperate with, and take all reasonable actions requested by,
            the Company to provide an orderly management transition.

                                   ARTICLE V

                                 INDEMNIFICATION

5.01 INDEMNIFICATION BY THE COMPANY. The Company shall indemnify and hold
harmless the Advisor and its Affiliates, including their respective officers,
directors, partners and employees, from all liability, claims, damages or losses
arising in the performance of their duties hereunder, and related expenses,
including reasonable attorneys' fees, to the extent such liability, claims,
damages or losses and related expenses are not fully reimbursed by insurance,
subject to any limitations imposed by the laws of the State of Maryland, the
NASAA Guidelines and the Articles of Incorporation. The foregoing indemnity
shall extend, without limitation, to any claims to the extent relating to any of
the events or outcomes set forth in the Prospectus as possible results, outcomes
or risks associated with the business and investment objectives of the Company.
Notwithstanding the foregoing, the Advisor shall not be entitled to
indemnification or be held harmless pursuant to this Section 5.01 for any
activity which the Advisor shall be required to indemnify or hold harmless the
Company pursuant to Section 5.02. Any indemnification of the Advisor may be made
only out of the net assets of the Company and not from Stockholders.

5.02 INDEMNIFICATION BY ADVISOR. The Advisor shall indemnify and hold harmless
the Company from contract or other liability, claims, damages, taxes or losses
and related expenses including attorneys' fees, to the extent that such
liability, claims, damages, taxes or losses and related expenses are not fully
reimbursed by insurance and are incurred by reason of the Advisor's bad faith,
fraud, misfeasance, misconduct, negligence or reckless disregard of its duties,
but the Advisor shall not be held responsible for any action of the Board of
Directors in following or declining to follow any advice or recommendation given
by the Advisor.

                                   ARTICLE VI

                                  MISCELLANEOUS

6.01 ASSIGNMENT TO AN AFFILIATE. This Agreement may be assigned by the Advisor
to an Affiliate of the Advisor with the approval of a majority of the Board of
Directors (including a majority of the Independent Directors). The Advisor may
assign any rights to receive fees or other payments under this Agreement without
obtaining the approval of the Board of Directors. This Agreement shall not be
assigned by the Company without the consent of the Advisor, except in the case
of an assignment by the Company to a corporation or other organization which is
a successor to all of the assets, rights and obligations of the Company, in
which case such successor organization shall be bound hereunder and by the terms
of said assignment in the same manner as the Company is bound by this Agreement.
This Agreement shall be binding on successors to the Company resulting from a
Change of Control or sale of all or substantially all the assets of the Company
or the Partnership, and shall likewise be binding upon any successor to the
Advisor.

6.02 RELATIONSHIP OF ADVISOR AND COMPANY. The Company and the Advisor are not
partners or joint venturers with each other, and nothing in this Agreement shall
be construed to make them such partners or joint venturers or impose any
liability as such on either of them.

                                      -16-
<PAGE>

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

To the Directors and to the Company:  Cole Credit Property Trust II, Inc.
                                      2555 E. Camelback Road, Suite 400
                                      Phoenix, Arizona 85016
                                      Attention: Chief Executive Officer and
                                                 President

To the Advisor:                       Cole REIT Advisors II, LLC
                                      2555 E. Camelback Road, Suite 400
                                      Phoenix, Arizona 85016
                                      Attention: Chief Executive Officer and
                                                 President

Either party shall, as soon as reasonably practicable, give notice in writing to
the other party of a change in its address for the purposes of this Section
6.03.

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

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

6.06 CHOICE OF LAW; VENUE. The provisions of this Agreement shall be construed
and interpreted in accordance with the laws of the State of Arizona, and venue
for any action brought with respect to any claims arising out of this Agreement
shall be brought exclusively in Maricopa County, Arizona.

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

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

6.09 GENDER; NUMBER. 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.

                                      -17-
<PAGE>

6.10 HEADINGS. The titles and headings of sections and subsections contained in
this Agreement are for convenience only, and they neither form a part of this
Agreement nor are they to be used in the construction or interpretation hereof.

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

6.12 INITIAL INVESTMENT. The Advisor or one of its Affiliates has contributed
$200,000 (the "INITIAL INVESTMENT") in exchange for the initial issuance of
Shares of the Company. The Advisor or its Affiliates may not sell any of the
Shares purchased with the Initial Investment while the Advisor acts in an
advisory capacity to the Company. The restrictions included above shall not
apply to any Shares acquired by the Advisor or its Affiliates other than the
Shares acquired through the Initial Investment. Neither the Advisor nor its
Affiliates shall vote any Shares they now own, or hereafter acquires, in any
vote for the election of Directors or any vote regarding the approval or
termination of any contract with the Advisor or any of its Affiliates.

                                      -18-
<PAGE>

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

                                       COLE CREDIT PROPERTY TRUST II, INC.

                                       By: _____________________________________
                                           Christopher H. Cole
                                           Chief Executive Officer and President

                                       COLE REIT ADVISORS II, LLC

                                       By: _____________________________________
                                           Christopher H. Cole
                                           Chief Executive Officer and President

                                      -19-<PAGE>
                                                                    EXHIBIT 10.3

                FORM OF PROPERTY MANAGEMENT AND LEASING AGREEMENT

         This PROPERTY MANAGEMENT AND LEASING AGREEMENT (this "Management
Agreement") is made and entered into as of the ___ day of _________ , 2005, by
and among COLE CREDIT PROPERTY TRUST II, INC., a Maryland corporation ("Cole
REIT"), COLE OPERATING PARTNERSHIP II, LP, a Delaware limited partnership ("Cole
OP"), and FUND REALTY ADVISORS, INC., an Arizona corporation (the "Manager").

         WHEREAS, COLE OP was organized to acquire, own, operate, lease and
manage real estate properties on behalf of COLE REIT;

         WHEREAS, COLE REIT intends to raise money from the sale of its common
stock to be used, net of payment of certain offering costs and expenses, for
investment in the acquisition or construction of income-producing real estate
and other real estate-related investments (including the making or purchase of
mortgage loans), some or all of which are to be acquired and held by Owner (as
hereinafter defined) on behalf of COLE REIT; and

         WHEREAS, Owner intends to retain Manager to manage and coordinate the
leasing of certain of the real estate properties acquired by Owner under the
terms and conditions set forth in this Management Agreement.

         NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound hereby, do
hereby agree, as follows:

                                    ARTICLE I

                                   DEFINITIONS

         Except as otherwise specified or as the context may otherwise require,
the following terms have the respective meanings set forth below for all
purposes of this Management Agreement, and the definitions of such terms are
equally applicable both to the singular and plural forms thereof:

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

1.2 "Gross Revenues" means all amounts actually collected as rents or other
charges for the use and occupancy of the Properties, but shall exclude interest
and other investment income of Owner and proceeds received by Owner for a sale,
exchange, condemnation, eminent domain taking, casualty or other disposition of
assets of Owner.

1.3 "Improvements" means buildings, structures, equipment from time to time
located on the Properties and all parking and common areas located on the
Properties.

<PAGE>

1.4 "Intellectual Property Rights" means all rights, titles and interests,
whether foreign or domestic, in and to any and all trade secrets, confidential
information rights, patents, invention rights, copyrights, service marks,
trademarks, know-how, or similar intellectual property rights and all
applications and rights to apply for such rights, as well as any and all moral
rights, rights of privacy, publicity and similar rights and license rights of
any type under the laws or regulations of any governmental, regulatory, or
judicial authority, foreign or domestic and all renewals and extensions thereof.

1.5 "Lease" means, unless the context otherwise requires, any lease or sublease
made by Owner as landlord or by its predecessor.

1.6 "Management Fees" has the meaning set forth in Section 5.1 hereof.

1.7 "Owner" means Cole REIT, Cole OP and any joint venture, limited liability
company or other Affiliate of Cole REIT or Cole OP that owns, in whole or in
part, on behalf of Cole REIT, any Properties.

1.8 "Person" means an individual, corporation, association, business trust,
estate, trust, partnership, limited liability company or other legal entity.

1.9 "Properties" means all real estate properties owned by Owner and all tracts
as yet unspecified but to be acquired by Owner containing income-producing
improvements or on which Owner will construct income-producing improvements.

1.10 "Proprietary Properties" means all modeling algorithms, tools, computer
programs, know-how, methodologies, processes, technologies, ideas, concepts,
skills, routines, subroutines, operating instructions and other materials and
aides used in performing the duties set forth in Article 2 that relate to
management advice, services and techniques regarding current and potential
Properties, and all modifications, enhancements and derivative works of the
foregoing.

                                   ARTICLE II

                APPOINTMENT OF MANAGER; SERVICES TO BE PERFORMED

2.1 Appointment of Manager. Owner hereby engages and retains Manager as the
manager and as tenant coordinating agent of the Properties, and Manager hereby
accepts such appointment on the terms and conditions hereinafter set forth; it
being understood that this Management Agreement shall cause Manager to be, at
law, Owner's agent upon the terms contained herein.

2.2 General Duties. Manager shall devote its best efforts to performing its
duties hereunder to manage, operate, maintain and lease the Properties in a
diligent, careful and vigilant manner. The services of Manager are to be of
scope and quality not less than those generally performed by professional
property managers of other similar properties in the area. Manager shall make
available to Owner the full benefit of the judgment, experience and advice of
the members of Manager's organization and staff with respect to the policies to
be pursued by Owner relating to the operation and leasing of the Properties.

2.3      Specific Duties.  Manager's duties include the following:

                  (a) Lease Obligations. Manager shall perform all duties of the
landlord under all Leases insofar as such duties relate to operation,
maintenance, and day-to-day management. Manager shall also provide or cause to
be provided, at Owner's expense, all services normally provided to tenants of
like premises, including where applicable and without limitation, gas,
electricity or other utilities required to be furnished to tenants under Leases,
normal repairs and maintenance, and cleaning, and

                                      -2-
<PAGE>

janitorial service. Manager shall arrange for and supervise the performance of
all installations and improvements in space leased to any tenant that are either
expressly required under the terms of the lease of such space or that are
customarily provided to tenants.

                  (b) Maintenance. Manager shall cause the Properties to be
maintained in the same manner as similar properties in the area. Manager's
duties and supervision in this respect shall include, without limitation,
cleaning of the interior and the exterior of the Improvements and the public
common areas on the Properties and the making and supervision of repair,
alterations, and decoration of the Improvements, subject to and in strict
compliance with this Management Agreement and the Leases. Construction
activities undertaken by Manager, if any, will be limited to activities related
to the management, operation, maintenance, and leasing of the Property (e.g.,
repairs, renovations, and leasehold improvements).

                  (c) Leasing Functions. Manager shall coordinate the leasing of
the Properties and shall negotiate and use its best efforts to secure executed
Leases from qualified tenants, and to execute same on behalf of Owner, if
requested, for available space in the Properties, such Leases to be in form and
on terms approved by Owner and Manager, and to bring about complete leasing of
the Properties. Manager shall be responsible for the hiring of all leasing
agents, as necessary for the leasing of the Properties, and to otherwise oversee
and manage the leasing process on behalf of Owner.

                  (d) Notice of Violations. Manager shall forward to Owner
promptly upon receipt all notices of violation or other notices from any
governmental authority, and board of fire underwriters or any insurance company,
and shall make such recommendations regarding compliance with such notice as
shall be appropriate.

                  (e) Personnel. Any personnel hired by Manager to maintain,
operate and lease the Property shall be the employees or independent contractors
of Manager and not of Owner of such Property, Cole OP or Cole REIT. Manager
shall use due care in the selection and supervision of such employees or
independent contractors. Manager shall be responsible for the preparation of and
shall timely file all payroll tax reports and timely make payments of all
withholding and other payroll taxes with respect to each employee.

                  (f) Utilities and Supplies. Manager shall enter into or renew
contracts for electricity, gas, steam, landscaping, fuel, oil, maintenance and
other services as are customarily furnished or rendered in connection with the
operation of similar rental property in the area.

                  (g) Expenses. Manager shall analyze all bills received for
services, work and supplies in connection with maintaining and operating the
Properties, pay all such bills when due, and, if requested by Owner, pay, when
due, utility and water charges, sewer rent and assessments, and any other amount
payable in respect to the Properties. All bills shall be paid by Manager within
the time required to obtain discounts, if any. Owner may from time to time
request that Manager forward certain bills to Owner promptly after receipt, and
Manager shall comply with any such request. Manager shall pay all bills,
assessments, real property taxes, insurance premiums and any other amount
payable in respect to the Properties out of the Account (as hereinafter
defined). All expenses shall be billed at net cost (i.e., less all rebates,
commissions, discounts and allowances, however designed).

                  (h) Monies Collected. Manager shall timely collect all rent
and other monies, in the form of a check or money order, from tenants and any
sums otherwise due Owner with respect to the Properties in the ordinary course
of business. Owner authorizes Manager to request, demand, collect and provide
receipts for all such rent and other monies and to institute legal proceedings
in the name of Owner for the collection thereof and for the dispossession of any
tenant in default under its Lease.

                                      -3-
<PAGE>

                  (i) Banking Accommodations. Manager shall establish and
maintain a separate checking account in the Owner's name and controlled by
Manager subject to the provisions of this Management Agreement, (the "Account")
for funds relating to the Properties. All monies deposited from time to time in
the Account shall be and remain the property of Owner and shall be withdrawn and
disbursed by Manager for the account of Owner only as expressly permitted by
this Management Agreement for the purposes of performing the obligations of
Manager hereunder. No monies collected by Manager on Owner's behalf shall be
commingled with funds of Manager. The Account shall be maintained, and monies
shall be deposited therein and withdrawn therefrom, in accordance with the
following:

                      (i) All sums received from rents and other income from the
Properties shall be promptly deposited by Manager in the Account. Manager shall
have the right to designate two or more persons who shall be authorized to draw
against the Account, but only for purposes authorized by this Management
Agreement.

                      (ii) All sums due to Manager hereunder, whether for
compensation, reimbursement for expenditures, or otherwise, as herein provided,
shall be a charge against the operating revenues of the Properties and shall be
paid and/or withdrawn by Manager from the Account prior to the making of any
other disbursements therefrom.

                      (iii) By the 15th day after the end of each month, Manager
shall forward to Owner all monies contained in the Account other than a
reasonable minimum balance (to be determined jointly by Manager and Owner from
time to time) and any other amounts otherwise provided in the budget, which
shall remain in the Account.

                  (j) Ownership Agreements. Manager has received copies of (and
will be provided with copies of future) articles of incorporation, agreements of
limited partnership, joint venture partnership agreements and operating
agreements, each as may be amended from time to time, of Owner, as applicable
(the "Ownership Agreements") and is familiar with the terms thereof. Manager
shall use reasonable care to avoid any act or omission that, in the performance
of its duties hereunder, shall in any way conflict with the terms of Ownership
Agreements.

                  (k) Signs. Manager shall place and remove, or cause to be
placed and removed, such signs upon the Properties as Manager deems appropriate,
subject, however, to the terms and conditions of the Leases and to any
applicable ordinances and regulations.

2.4 Approval of Leases, Contracts, Etc. In fulfilling its duties to Owner,
Manager may and hereby is authorized to enter into any leases, contracts or
agreements on behalf of Owner in the ordinary course of the management,
operation, maintenance and leasing of the Property.

2.5 Accounting, Records and Reports.

                  (a) Records. Manager shall maintain all office records and
books of account and shall record therein, and keep copies of, each invoice
received from services, work and supplies ordered in connection with the
maintenance and operation of the Properties. Such records shall be maintained on
a double entry basis. Owner and persons designated by Owner shall at all
reasonable times have access to and the right to audit and make independent
examinations of such records, books and accounts and all vouchers, files and all
other material pertaining to the Properties and this Management Agreement, all
of which Manager agrees to keep safe, available and separate from any records
not pertaining to the Properties, at a place recommended by Manager and approved
by Owner.

                                      -4-
<PAGE>

                  (b) Monthly Reports. On or before the 15th day after the end

of each month during the term of this Management Agreement, Manager shall
prepare and submit to Owner the following reports and statements:

                      (i)  rental collection record;

                      (ii) monthly operating statement;

                      (iii) copy of cash disbursements ledger entries for such
period, if requested;

                      (iv) copy of cash receipts ledger entries for such period,
if requested;

                      (v)  the original copies of all contracts entered into by
Manager on behalf of Owner during such period, if requested; and

                      (vi) copy of ledger entries for such period relating to
security deposits maintained by Manager, if requested.

                  (c) Budgets and Leasing Plans. Not later than November 15 of
each calendar year, Manager shall prepare and submit to Owner for its approval
an operating budget and a marketing and leasing plan on each Property for the
calendar year immediately following such submission. In connection with any
acquisition of a Property by Owner, Manager shall prepare a budget and marketing
and leasing plan for the remainder of the calendar year. The budget and
marketing and leasing plan shall be in the form of the budget and plan approved
by Owner prior to the date thereof. As often as reasonably necessary during the
period covered by any such budget, Manager may submit to Owner for its approval
an updated budget or plan incorporating such changes as shall be necessary to
reflect cost over-runs and the like during such period. If Owner does not
disapprove any such budget within 30 days after receipt thereof by Owner, such
budget shall be deemed approved. If Owner shall disapprove any such budget or
plan, it shall so notify Manager within said 30-day period and explain the
reasons therefor. If Owner disapproves of any budget or plan, Manager shall
submit a revised budget or plan, as applicable, within 10 (ten) days of receipt
of the notice of disapproval, and Owner shall have 10 (ten) days to provide
notice to Manager if it disapproves of any such revised budget or plan. Manager
will not incur any costs other than those estimated in any budget except for:

                  (i) tenant improvements and real estate commissions required
under a Lease;

                  (ii) maintenance or repair costs under $10,000 per Property;

                  (iii) costs incurred in emergency situations in which action
is immediately necessary for the preservation or safety of the Property, or for
the safety of occupants or other persons (or to avoid the suspension of any
necessary service of the Property);

                  (iv) expenditures for real estate taxes and assessment; and

                  (v) maintenance supplies calling for an aggregate purchase
price less than $25,000 per annum for all Properties.

          Budgets prepared by Manager shall be for planning and informational
purposes only, and Manager shall have no liability to Owner for any failure to
meet any such budget. However, Manager will use its best efforts to operate
within the approved budget.

                                      -5-
<PAGE>

                  (d) Legal Requirements. Manager shall execute and file when
due all forms, reports, and returns required by law relating to the employment
of its personnel. Manager shall be responsible for notifying Owner in the event
it receives notice that any Improvement on a Property or any equipment therein
does not comply with the requirements of any statute, ordinance, law or
regulation of any governmental body or of any public authority or official
thereof having or claiming to have jurisdiction thereover. Manager shall
promptly forward to Owner any complaints, warnings, notices or summonses
received by it relating to such matters. Owner represents that to the best of
its knowledge each of its Properties and any equipment thereon will upon
acquisition by Owner comply with all such requirements. Owner authorizes Manager
to disclose the ownership of the Property by Owner to any such officials. Owner
agrees to indemnify, protect, defend, save and hold Manager and its
stockholders, officers, directors, employees, managers, successors and assigns
(collectively, the "Indemnified Parties") harmless of and from any and all
Losses (as defined in Section 3.5(a) hereof) that may be imposed on them or any
or all of them by reason of the failure of Owner to correct any present or
future violation or alleged violation of any and all present or future laws,
ordinances, statutes, or regulations of any public authority or official
thereof, having or claiming to have jurisdiction thereover, of which it has
actual notice.

                                   ARTICLE III

           AUTHORITY GRANTED TO MANAGER AND CERTAIN OWNER OBLIGATIONS

3.1 Authority As To Tenants, Etc. Owner agrees and does hereby give Manager the
following exclusive authority and powers (all of which shall be exercised either
in the name of Manager, as Manager for Owner, or in the name or Owner entered
into by Manager as Owner's authorized agent, and Owner shall assume all expenses
in connection with such matters):

                  (a) to advertise each Property or any part thereof and to
display signs thereon, as permitted by law;

                  (b) to lease the Properties to tenants;

                  (c) to pay all expenses of leasing such Property, including
but not limited to, newspaper and other advertising, signage, banners,
brochures, referral commissions, leasing commissions, finder's fees and
salaries, bonuses and other compensation of leasing personnel responsible for
the leasing of the Property;

                  (d) to cause references of prospective tenants to be
investigated, it being understood and agreed by the parties hereto that Manager
does not guarantee the creditworthiness or collectibility of accounts receivable
from tenants, users or lessees; and to negotiate new Leases and renewals and
cancellations of existing Leases that shall be subject to Manager obtaining
Owner's approval;

                  (e) to collect from tenants all or any of the following: a
late rent administrative charge, a non-negotiable check charge, credit report
fee, a subleasing administrative charge and/or broker's commission; and Manager
need not account for such charges and/or commission to Owner;

                  (f) to terminate tenancies and to sign and serve in the name
of Owner of each Property such notices as are deemed necessary by Manager:

                      (i)  to institute and prosecute actions to evict tenants
and to recover possession of the Property or portions thereof; and

                                      -6-
<PAGE>

                      (ii) with Owner's authorization, to sue for and in the
name of Owner and recover rent and other sums due; and to settle, compromise,
and release such actions or suits, or reinstate such tenancies. All expenses of
litigation including, but not limited to, attorneys' fees, filing fees, and
court costs that Manager shall incur in connection with the collecting of rent
and other sums, or to recover possession of any Property or any portion thereof,
shall be deemed to be an operational expense of the Property. Manager and Owner
shall concur on the selection of the attorneys to handle such litigation.

3.2 Operational Authority. Owner agrees and does hereby give Manager the
following exclusive authority and powers (all of which shall be exercised either
in the name of Manager, as Manager for Owner, or in the name or Owner entered
into by Manager as Owner's authorized agent, and Owner shall assume all expenses
in connection with such matters):

                  (a) to hire, supervise, discharge, and pay all labor required
for the operation and maintenance of each Property including but not limited to
on-site personnel, managers, assistant managers, leasing consultants, engineers,
janitors, maintenance supervisors and other employees required for the operation
and maintenance of the Property, including personnel spending a portion of their
working hours (to be charged on a pro rata basis) at the Property. All expenses
of such employment shall be deemed operational expenses of the Property.

                  (b) to make or cause to be made all ordinary repairs and
replacements necessary to preserve each Property in its present condition and
for the operating efficiency thereof and all alterations required to comply with
lease requirements, and to decorate the Property;

                  (c) to negotiate and enter into, as Manager of the Property,
contracts for all items on budgets that have been approved by Owner, any
emergency services or repairs for items not exceeding $10,000, appropriate
service agreements and labor agreements for normal operation of the Property,
which have terms not to exceed three years, and agreements for all budgeted
maintenance, minor alterations, and utility services, including, but not limited
to, electricity, gas, fuel, water, telephone, window washing, scavenger service,
landscaping, snow removal, pest exterminating, decorating and legal services in
connection with the Leases and service agreements relating to the Property, and
other services or such of them as Manager may consider appropriate; and

                  (d) to purchase supplies and pay all bills.

Manager shall use its best efforts to obtain the foregoing services and
utilities for the Property under terms that are as cost-effective and otherwise
favorable to Manager as possible for the quality of services and utilities
required. Owner hereby appoints Manager as Owner's authorized Manager for the
purpose of executing, as Manager for said Owner, all such contracts. In
addition, Owner agrees to specifically assume in writing all obligations under
all such contracts so entered into by Manager, on behalf of Owner of the
Property, upon the termination of this Manager Agreement, and Owner shall
indemnify, protect, save, defend and hold Manager and the other Indemnified
Parties harmless from and against any and all Losses resulting from, arising out
of or in any way related to such contracts and that relate to or concern matters
occurring after termination of this Management Agreement, but excluding matters
arising out of Manager's willful misconduct, gross negligence and/or unlawful
acts. Manager shall secure the written approval of appropriate contracts by
Owner for any non-budgeted and non-emergency/contingency capital items,
alterations or other expenditures in excess of $10,000 for any one item,
securing for each item at least three written bids, if practicable, or providing
evidence satisfactory to Owner, including such reasonable actions taken by the
Manager, that the contract amount is lower than industry standard pricing, from
responsible contractors. Manager shall have the right from time to time during
the term hereof, to contract with and make purchases from Affiliates of Manager,
provided that contract rates and prices are competitive with other available
sources. Manager may at any time and from time to time request and

                                      -7-
<PAGE>

receive the prior written authorization of Owner of the Property of any one or
more purchases or other expenditures, notwithstanding that Manager may otherwise
be authorized hereunder to make such purchases or expenditures.

3.3 Rent and Other Collections. Owner agrees and does hereby give Manager the
exclusive authority and powers (all of which shall be exercised either in the
name of Manager, as Manager for Owner, or in the name or Owner entered into by
Manager as Owner's authorized agent, and Owner shall assume all expenses in
connection with such matters) to collect rents and/or assessments and other
items, including but not limited to tenant payments for real estate taxes,
property liability and other insurance, damages and repairs, common area
maintenance, tax reduction fees and all other tenant reimbursements,
administrative charges, proceeds of rental interruption insurance, parking fees,
income from coin operated machines and other miscellaneous income, due or to
become due and give receipts therefor and to deposit all such Gross Revenue
collected hereunder in the Account. Manager may endorse any and all checks
received in connection with the operation of any Property and drawn to the order
of Owner, and Owner shall, upon request, furnish Manager's depository with an
appropriate authorization for Manager to make such endorsement. Manager shall
also have the exclusive authority to collect and handle tenants' security
deposits, including the right to apply such security deposits to unpaid rent,
and to comply, on behalf of Owner of the Property, with applicable state or
local laws concerning security deposits and interest thereon, if any. Manager
shall not be required to advance any monies for the care or management of any
Property. Owner agrees to advance all monies necessary therefor. If Manager
shall elect to advance any money in connection with a Property, as permitted by
applicable law, Owner agrees to reimburse Manager forthwith and hereby
authorizes Manager to deduct such advances from any monies due Owner. In
connection with any insured losses or damages relating to any Property, Manager
shall have the exclusive authority to handle all steps necessary regarding any
such claim; provided that Manager will not make any adjustments or settlements
in excess of $10,000 without Owner's prior written consent.

3.4 Payment of Expenses. Owner agrees and does hereby give Manager the exclusive
authority and power (all of which shall be exercised either in the name of
Manager, as Manager for Owner, or in the name or Owner entered into by Manager
as Owner's authorized agent, and Owner shall assume all expenses in connection
with such matters) to pay all expenses of the Property from the Gross Revenue
collected in accordance with Section 3.3 above, from the Account. It is
understood that the Gross Revenue will be used first to pay the compensation to
Manager as contained in Article 5 below, then operational expenses and then any
mortgage indebtedness, including real estate tax and insurance impounds, but
only as directed by Owner in writing and only if sufficient Gross Revenue is
available for such payments. Nothing in this Management Agreement shall be
interpreted in such a manner as to obligate Manager to pay from Gross Revenue,
any expenses incurred by Owner prior to the commencement of this Management
Agreement, except to the extent Owner advances additional funds to pay such
expenses.

3.5 Certain Owner Indemnification Obligations.

                  (a) On Termination. In the event this Management Agreement is
terminated for any reason prior to the expiration of its original term or any
renewal term, Owner shall indemnify, protect, defend, save and hold Manager and
all of the other Indemnified Parties harmless from and against any and all
claims, causes of action, demands, suits, proceedings, loss, judgments, damage,
awards, liens, fines, costs, attorney's fees and expenses, of every kind and
nature whatsoever (collectively, "Losses"), that may be imposed on or incurred
by Manager by reason of the willful misconduct, gross negligence and/or unlawful
acts (such unlawfulness having been adjudicated by a court of proper
jurisdiction) of Owner.

                                      -8-
<PAGE>

                  (b) Property Damage, Etc. Owner agrees to indemnify, defend,
protect, save and hold Manager and all of the other Indemnified Parties harmless
from any and all Losses in connection with or in any way related to the Property
and from liability for damage to the Property and injuries to or death of any
person whomsoever, and damage to property; provided, however, that such
indemnification shall not extend to any such Losses arising out of the willful
misconduct, gross negligence and/or unlawful acts (such unlawfulness having been
adjudicated by a court of proper jurisdiction) of Manager or any of the other
Indemnified Parties. Manager shall not be liable for any error of judgment or
for any mistake of fact or law, or for any thing that it may do or refrain from
doing, except in cases of willful misconduct, gross negligence and/or unlawful
acts (such unlawfulness having been adjudicated by a court of proper
jurisdiction).

3.6 Environmental Matters. Owner hereby warrants and represents to Manager that
to the best of Owner's knowledge, no Property, upon acquisition by Owner, nor
any part thereof, will be used to treat, deposit, store, dispose of or place any
hazardous substance that may subject Manager to liability or claims under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42
U.S.C.A. Section 9607) or any constitutional provision, statute, ordinance, law,
or regulation of any governmental body or of any order or ruling of any public
authority or official thereof, having or claiming to have jurisdiction
thereover. Furthermore, Owner agrees to indemnify, protect, defend, save and
hold Manager and all of the other Indemnified Parties from any and all Losses
involving, concerning or in any way related to any past, current or future
allegations regarding treatment, depositing, storage, disposal or placement by
any party other than Manager of hazardous substances on the Property.

3.7 Legal Status of Properties. Owner represents that to the best of its
knowledge each Property and any equipment thereon, when acquired by Owner, will
comply with all legal requirements and authorizes Manager to disclose the
identity of the Owner of the Property to any such officials and agrees to
indemnify, protect, defend, save and hold Manager and the other Indemnified
Parties harmless of and from any and all Losses that may be imposed on them or
any of them by reason of the failure of Owner to correct any present or future
violation or alleged violation of any and all present or future laws,
ordinances, statutes, or regulations of any public authority or official
thereof, having or claiming to have jurisdiction thereover, of which it has
actual notice. In the event it is alleged or charged that any Improvement or any
equipment on a Property or any act or failure to act by Owner with respect to
the Property or the sale, rental, or other disposition thereof fails to comply
with, or is in violation of, any of the requirements of any constitutional
provision, statute, ordinance, law, or regulation of any governmental body or
any order or ruling of any public authority or official thereof having or
claiming to have jurisdiction thereover, and Manager, in its sole and absolute
discretion, considers that the action or position of Owner, with respect thereto
may result in damage or liability to Manager, Manager shall have the right to
cancel this Management Agreement at any time by written notice to Owner of its
election so to do, which cancellation shall be effective upon the service of
such notice. Such cancellation shall not release the indemnities of Owner set
forth in this Management Agreement and shall not terminate any liability or
obligation of Owner to Manager for any payment, reimbursement, or other sum of
money then due and payable to Manager hereunder.

3.8 Extraordinary Payments. Owner agrees to give adequate advance written notice
to Manager if Owner desires that Manager make any extraordinary payment, out of
Gross Revenue, to the extent funds are available after the payment of Manager's
compensation as provided for herein and all operational expenses, of mortgage
indebtedness, general taxes, special assessments, or fire, boiler or any other
insurance premiums.

                                      -9-
<PAGE>

                                   ARTICLE IV

                                    EXPENSES

4.1 Owner's Expenses. Except as otherwise specifically provided, all costs and
expenses incurred hereunder by Manager in fulfilling its duties to Owner shall
be for the account of and on behalf of Owner. Such costs and expenses shall
include the wages and salaries and other employee-related expenses, unless
otherwise waived, in whole or in part, by the Manager in its sole discretion, of
all on-site and off-site employees of Manager who are engaged in the operation,
management, maintenance and leasing or access control of the Properties,
including taxes, insurance and benefits relating to such employees, and legal,
travel and other out-of-pocket expenses that are directly related to the
management of specific Properties. All costs and expenses for which Owner is
responsible under this Management Agreement shall be paid by Manager out of the
Account. In the event the Account does not contain sufficient funds to pay all
said expenses, Owner shall fund all sums necessary to meet such additional costs
and expenses.

4.2 Manager's Expenses. Manager shall, out of its own funds, pay all of its
general overhead and administrative expenses.

                                    ARTICLE V

                             MANAGER'S COMPENSATION

5.1 Management Fees. Commencing on the date hereof, Owner shall pay Manager
property management and leasing fees in an amount equal to two percent (2.0%)
of Gross Revenues, less all payments to third-party property management
subcontractors (the "Management Fees") on a monthly basis from the rental income
received from the Properties over the term of this Management Agreement.
Manager's compensation under this Section 5.1 shall apply to all renewals,
extensions or expansions of Leases that Manager has originally negotiated. In
the event Manager assists with planning and coordinating the construction of any
tenant-paid finish-out or improvements, Manager shall be entitled to receive
from the Owner for any such tenant improvement an amount equal to not greater
than five percent (5.0%) of the cost of such tenant improvements.

5.2 Leasing Fees. In addition to the compensation paid to Manager under Section
5.1 above, Manager shall be entitled to receive a separate fee for the Leases of
new tenants and renewals of Leases with existing tenants in an amount not to
exceed the fee customarily charged in arm's length transactions by others
rendering similar services in the same geographic area for similar properties as
determined by a survey of brokers and agents in such area ("Leasing Fees").

5.3 Audit Adjustment. If any audit of the records, books or accounts relating to
the Properties discloses an overpayment or underpayment of Management Fees,
Owner or Manager shall promptly pay to the other party the amount of such
overpayment or underpayment, as the case may be. If such audit discloses an
overpayment of Management Fees for any fiscal year of more than the correct
Management Fees for such fiscal year, Manager shall bear the cost of such audit.

5.4 Additional Services. Any services beyond those specified herein, such as
sales, brokerage, loan origination and servicing, property tax reduction and
risk management services, shall be performed by Manager and compensated by Owner
only if the parties agree on the scope of such work and provided that the
compensation to be paid therefore will not exceed that which would be paid to
unrelated parties providing such services and provided further that all such
compensation must be approved by a majority of the directors, including a
majority of the independent directors (as defined in the charter of the Owner),
not otherwise interested in the transaction, of Owner.

                                      -10-
<PAGE>

                                   ARTICLE VI

                          INSURANCE AND INDEMNIFICATION

6.1 Insurance to be Carried.

                  (a) Manager shall obtain and keep in full force and effect
insurance on the Properties against such hazards as Owner and Manager shall deem
appropriate, but in any event insurance sufficient to comply with the Leases and
Ownership Agreements shall be maintained. All liability policies shall provide
sufficient insurance satisfactory to both Owner and Manager and shall contain
waivers of subrogation for the benefit of Manager.

                  (b) Manager shall obtain and keep in full force and effect, in
accordance with the laws of the state in which each Property is located,
employer's liability insurance applicable to and covering all employees of
Manager at the Properties and all persons engaged in the performance of any work
required hereunder, and Manager shall furnish Owner certificates of insurers
naming Owner as a co-insured and evidencing that such insurance is in effect. If
any work under this Management Agreement is subcontracted as permitted herein,
Manager shall include in each subcontract a provision that the subcontractor
shall also furnish Owner with such a certificate.

6.2 Insurance Expenses. Premiums and other expenses of such insurance, as well
as any applicable payments in respect of deductibles shall be borne by Owner.

6.3 Cooperation with Insurers. Manager shall cooperate with and provide
reasonable access to the Properties to representatives of insurance companies
and insurance brokers or agents with respect to insurance that is in effect or
for which application has been made. Manager shall use its best efforts to
comply with all requirements of insurers.

6.4 Accidents and Claims. Manager shall promptly investigate and shall report in
detail to Owner all accidents, claims for damage relating to Ownership,
operation or maintenance of the Properties, and any damage or destruction to the
Properties and the estimated costs of repair thereof, and shall prepare for
approval by Owner all reports required by an insurance company in connection
with any such accident, claim, damage, or destruction. Such reports shall be
given to Owner promptly, and any report not so given within 30 (thirty) days
after the occurrence of any such accident, claim, damage or destruction shall be
noted in the monthly operating statement delivered to Owner pursuant to Section
2.5(b). Manager is authorized to settle any claim against an insurance company
arising out of any policy and, in connection with such claim, to execute proofs
of loss and adjustments of loss and to collect and receipt for loss proceeds.

6.5 Indemnification. Manager shall hold Owner harmless from and indemnify and
defend Owner against any and all claims or liability for any injury or damage to
any person or property whatsoever for which Manager is responsible occurring in,
on, or about the Properties, including, without limitation, the Improvements
when such injury or damage shall be caused by the negligence of Manager, its
agents, servants, or employees, except to the extent that Owner recovers
insurance proceeds with respect to such matter. Owner will indemnify and hold
Manager harmless against all liability for injury to persons and damage to
property caused by Owner's negligence and which did not result from the
negligence of misconduct of Manager, except to the extent Manager recovers
insurance proceeds with respect to such matter.

                                      -11-
<PAGE>

                                   ARTICLE VII

                              TERM AND TERMINATION

7.1 Term. This Management Agreement shall commence on the date first above
written and shall continue until the third (3rd) anniversary of such date and
thereafter for three successive three (3) year renewal periods, provided that on
or before 30 days prior to the date last above mentioned or on or before 30 days
prior to the expiration of any such renewal period, Manager shall notify Owner
in writing of such automatic renewal. Either party may terminate this Management
Agreement, without cause, by giving the other party thirty (30) days written
notice prior to such date. In addition, either party may terminate this
Management Agreement immediately upon the occurrence of any of the following:

                  (a) A decree or order is rendered by a court having
jurisdiction (i) adjudging Manager as bankrupt or insolvent, or (ii) approving
as properly filed a petition seeking reorganization, readjustment, arrangement,
composition or similar relief for Manager 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 Manager or a
substantial part of the property of Manager, or for the winding up or
liquidation of its affairs, or

                  (b) Manager (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 other party, or (iv) takes
corporate or other action in furtherance of any of the aforesaid purposes.

Upon any termination pursuant to this Section 7.1, the provisions and
obligations of this Management Agreement shall be deemed terminated, except that
the obligation of the parties for fees due between one another and the
obligations of indemnity set forth herein shall survive such termination.
Manager shall cooperate with Owner in transfers of management and accounting
functions hereunder.

7.2 Manager's Obligations Upon Termination. Upon the termination of this
Management Agreement, Manager shall have the following duties:

                  (a) Manager shall deliver to Owner or its designee, all books
and records with respect to the Properties.

                  (b) Manager shall transfer and assign to Owner, or its
designee, all service contracts and personal property relating to or used in the
operation and maintenance of the Properties, except personal property paid for
and owned by Manager. Manager shall also, for a period of sixty (60) days
immediately following the date of such termination, make itself available to
consult with and advise Owner, or its designee, regarding the operation,
maintenance and leasing of the Properties.

                  (c) Manager shall render to Owner an accounting of all funds
of Owner in its possession and shall deliver to Owner a statement of all
Management Fees claimed to be due to Manager and shall cause funds of Owner held
by Manager relating to the Properties to be paid to Owner or its designee.

                                      -12-
<PAGE>

7.3 Owner's Obligations Upon Termination. Owner shall pay or reimburse Manager
for any sums of money due it under this Management Agreement for services and
expenses prior to termination of this Management Agreement. All provisions of
this Management Agreement that require Owner to have insured, or to protect,
defend, save, hold and indemnify or to reimburse Manager shall survive any
expiration or termination of this Management Agreement and, if Manager is or
becomes involved in any claim, proceeding or litigation by reason of having been
Manager of Owner, such provisions shall apply as if this Management Agreement
were still in effect.

The parties understand and agree that Manager may withhold funds for sixty (60)
days after the end of the month in which this Management Agreement is terminated
to pay bills previously incurred but not yet invoiced and to close accounts.
Should the funds withheld be insufficient to meet the obligation of Manager to
pay bills previously incurred, Owner will, upon demand, advance sufficient funds
to Manager to ensure fulfillment of Manager's obligation to do so, within ten
(10) days of receipt of notice and an itemization of such unpaid bills.

                                  ARTICLE VIII

                                  MISCELLANEOUS

8.1 Notices. All notices, approvals, consents and other communications hereunder
shall be in writing, and, except when receipt is required to start the running
of a period of time, shall be deemed given when delivered in person or on the
fifth day after its mailing by either party by registered or certified United
States mail, postage prepaid and return receipt requested, to the other party,
at the addresses set forth after their respect name below or at such different
addresses as either party shall have theretofore advised the other party in
writing in accordance with this Section 8.1.

             Owner:      COLE OPERATING PARTNERSHIP II, LP
                         c/o Cole Credit Property Trust II, Inc.
                         2555 E. Camelback Road, Suite 400
                         Phoenix, Arizona  85016
                         Attention: General Partner

             Manager:    FUND REALTY ADVISORS, INC.
                         2555 E. Camelback Road, Suite 400
                         Phoenix, Arizona  85016
                         Attention: Chief Executive Officer

8.2 Governing Law; Venue. This Management Agreement shall be governed by and
construed in accordance with the laws of the State of Arizona, and any action
brought to enforce the agreements made hereunder or any action which arises out
of the relationship created hereunder shall be brought exclusively in Maricopa
County, Arizona.

8.3 Assignment. Manager may delegate partially or in full its duties and rights
under this Management Agreement but only with the prior written consent of
Owner. Owner acknowledges and agrees that any or all of the duties of Manager as
contained herein may be delegated by Manager and performed by a person or entity
("Submanager") with whom Manager contracts for the purpose of performing such
duties. Owner specifically grants Manager the authority to enter into such a
contract with a Submanager; provided that, unless Owner otherwise agrees in
writing with such Submanager, Owner shall have no liability or responsibility to
any such Submanager for the payment of the Submanager's fee or for reimbursement
to the Submanager of its expenses or to indemnify the Submanager in any manner
for any matter; and provided further that Manager shall require such Submanager
to agree, in the written agreement setting forth the duties and obligations of
such

                                      -13-
<PAGE>

Submanager, to indemnify Owner for all Losses incurred by Owner as a result
of the willful misconduct or gross negligence of the Submanager, except that
such indemnity shall not be required to the extent that Owner recovers issuance
proceeds with respect to such matter. Any contract entered into between Manager
and a Submanager pursuant to this Section 8.3 shall be consistent with the
provisions of this Management Agreement, except to the extent Owner otherwise
specifically agrees in writing. This Management Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and assigns.

8.4 Third Party Leasing Services. Manager acknowledges that from time to time
Owner may determine that it is in the best interests of Owner to retain a third
party to provide certain leasing services with respect to certain Properties and
to compensate such third party for such leasing services. Upon the prior written
consent of Manager, Owner shall have the authority to enter into such a contract
for leasing services with a third party (a "Third Party Leasing Agreement");
provided that Manager shall have no liability or responsibility to Owner for any
of the duties and obligations undertaken by such party, and Owner agrees to
indemnify Manager for all Losses incurred by Manager as a result of acts of such
third party pursuant to the Third Party Leasing Agreement. To the extent that
leasing services are specifically required to be performed by a third party
pursuant to such Third Party Leasing Agreement, Manager shall have no obligation
to perform such leasing services and Owner shall have no obligation to Manager
for leasing fees pursuant to Section 5.2 hereof. To the extent that both Manager
and such Third Party Leasing Agreement provides leasing services with respect to
certain Properties, the Leasing fees payable to Manager pursuant to Section 5.2
hereof shall be reduced by the amounts payable with respect to such Properties
to such Third Party Leasing Agreement.

8.5 Third Party Management Services. Manager acknowledges that from time to time
Owner may acquire interests in Properties in which Owner does not control the
determination of the party that is engaged to provide property management and
other services to be provided by Manager with respect to all Properties acquired
by Owner hereunder. Upon the prior written consent of Manager, Owner shall have
the authority to acquire such non-controlling interests in Properties for which
a third party provides some or all of the services otherwise required to be
performed by Manager hereunder (a "Third Party Management Agreement"); provided
that Manager shall have no liability or responsibility to Owner for any of the
duties and obligations undertaken by such third party, and Owner agrees to
indemnify Manager for all Losses incurred by Manager as a result of the acts of
such third party pursuant to the Third Party Management Agreement. To the extent
that property management and other services are specifically required to be
performed by a third party pursuant to such Third Party Management Agreement,
Manager shall have no obligation to perform such services and Owner shall have
no obligation to Manager for compensation for such services pursuant to Article
V hereof. To the extent that both Manager and such Third Party Leasing Agreement
provides leasing services with respect to certain Properties, the Leasing fees
payable to Manager pursuant to Section 5.2 hereof shall be reduced by the
amounts payable with respect to such Properties to such Third Party Leasing
Agreement.

8.6 No Waiver. The failure of Owner to seek redress for violation or to insist
upon the strict performance of any covenant or condition of this Management
Agreement shall not constitute a waiver thereof for the future.

8.7 Amendments. This Management Agreement may be amended only by an instrument
in writing signed by the party against whom enforcement of the amendment is
sought.

8.8 Headings. The headings of the various subdivisions of this Management
Agreement are for reference only and shall not define or limit any of the terms
or provisions hereof.

                                      -14-
<PAGE>

8.9 Counterparts. This Management Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and it shall not be
necessary in making proof of this Management Agreement to produce or account for
more than one such counterpart.

8.10 Entire Agreement. This Management Agreement contains the entire
understanding and all agreements between Owner and Manager respecting the
management of the Properties. There are no representations, agreements,
arrangements or understandings, oral or written, between Owner and Manager
relating to the management of the Properties that are not fully expressed
herein.

8.11 Disputes. If there shall be a dispute between Owner and Manager relating to
this Management Agreement resulting in litigation, the prevailing party in such
litigation shall be entitled to recover from the other party to such litigation
such amount as the court shall fix as reasonable attorneys' fees.

8.12 Activities of Manager. The obligations of Manager pursuant to the terms and
provisions of this Management Agreement shall not be construed to preclude
Manager from engaging in other activities or business ventures, whether or not
such other activities or ventures are in competition with Owner or the business
of Owner.

8.13 Independent Contractor. Manager and Owner shall not be construed as joint
venturers or partners of each other pursuant to this Management Agreement, and
neither shall have the power to bind or obligate the other except as set forth
herein. In all respects, the status of Manager to Owner under this Management
Agreement is that of an independent contractor.

8.14 No Third-Party Rights. Nothing expressed or referred to in this Management
Agreement will be construed to give any Person other than the parties to this
Management Agreement any legal or equitable right, remedy or claim under or with
respect to this Management Agreement or any provision of this Management
Agreement, except such rights as shall inure to a successor or permitted
assignee pursuant to Section 8.3.

8.15 Ownership of Proprietary Property. The Manager retains ownership of and
reserves all Intellectual Property Rights in the Proprietary Property. To the
extent that Owner has or obtains any claim to any right, title or interest in
the Proprietary Property, including without limitation in any suggestions,
enhancements or contributions that Owner may provide regarding the Proprietary
Property, Owner hereby assigns and transfers exclusively to the Manager all
right, title and interest, including without limitation all Intellectual
Property Rights, free and clear of any liens, encumbrances or licenses in favor
of Owner or any other party, in and to the Proprietary Property. In addition, at
the Manager's expense, Owner will perform any acts that may be deemed desirable
by the Manager to evidence more fully the transfer of ownership of right, title
and interest in the Proprietary Property to the Manager, including but not
limited to the execution of any instruments or documents now or hereafter
requested by the Manager to perfect, defend or confirm the assignment described
herein, in a form determined by the Manager.

         [THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]

                                      -15-
<PAGE>

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

                                COLE CREDIT PROPERTY TRUST II, INC.

                                By:  ______________________________________
                                     Christopher H. Cole
                                     Chief Executive Officer and President

                                COLE OPERATING PARTNERSHIP II, LP

                                By:  Cole Credit Property Trust, Inc.
                                     General Partner

                                     By:  ________________________________
                                          Christopher H. Cole
                                          Chief Executive Officer and President

                                FUND REALTY ADVISORS, INC.

                                By:  ______________________________
                                     Christopher H. Cole
                                     Chief Executive Officer and President

                                      -16-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00084-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00084-of-00352.parquet"}]]