Common use of Compensation of Advisor Clause in Contracts

Compensation of Advisor. (a) The Company shall pay the Advisor as an acquisition fee 4.0% of Total Proceeds for services pursuant to this Agreement, subject to reduction under certain circumstances described herein. The Company shall pay acquisition fees payable from gross offering proceeds to the Advisor as the Company receives offering proceeds from the sale of shares. Acquisition fees shall be reduced to the extent that, and if necessary to limit, the total compensation paid to all persons involved in the acquisition of any property to the amount customarily charged in arms-length transactions by other persons or entities rendering similar services as an ongoing public activity in the same geographical location and for comparable types of properties, and to the extent that other acquisition fees, finder’s fees, real estate commissions or other similar fees or commissions are paid by any person in connection with the transaction. The total of all acquisition fees and any Acquisition Expenses shall be reasonable and shall not exceed an amount equal to six percent (6%) of the Contract Purchase Price of a Property unless a majority of the Board of Directors, including a majority of the Independent Directors, not otherwise interested in the transaction, approves fees in excess of these limits subject to a determination that the transaction is commercially competitive, fair and reasonable to the Company. (b) 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 shall receive a Subordinated Disposition Fee equal to the lesser of (i) one-half of a Competitive Real Estate Commission or (ii) 3% of the Contract Sales Price of such Property or Properties. The Subordinated Disposition Fee will be paid only if Stockholders have received total Distributions in an amount equal to the sum of their aggregate Invested Capital and their aggregate Stockholders’ 8% Return. To the extent that Subordinated Disposition Fees are not paid by the Company on a current basis due to the foregoing limitation, the unpaid fees will be accrued and paid at such time as the subordination conditions have been satisfied. The Subordinated Disposition Fee will be paid in addition to real estate commissions paid to non-affiliates, provided that the total real estate commissions and fees paid to all persons by the Company (including the Subordinated Disposition Fee) shall not exceed an amount equal 6% of the Contract Sales Price of a Property. If this Agreement is terminated prior to such time as the Stockholders have received total Distributions in an amount equal to 100% of Invested Capital plus an amount sufficient to pay the Stockholders’ 8% Return through the Termination Date, an Appraisal of the Properties then owned by the Company shall be made and the Subordinated Disposition Fee on Properties previously sold will be deemed earned if the Appraised Value of the Properties then owned by the Company plus total Distributions received prior to the Termination Date equals 100% of Invested Capital plus an amount sufficient to pay the Stockholders’ 8% Return through the Termination Date. Upon Listing, if the Advisor has accrued but not been paid such Subordinated Disposition Fee, then for purposes of determining whether the subordination conditions have been satisfied, Stockholders will be deemed to have received a Distribution in the amount equal to the product of the total number of Shares outstanding and the average closing price of the Shares over a period, beginning 180 days after Listing, of 30 days during which the Shares are traded. (c) In the event Company purchases, sells, conveys or otherwise transfers a Property within ninety (90) days after the expiration of this Agreement to a person or persons with whom Advisor on behalf of Company has negotiated as a prospective buyer of a Property during the term of this Agreement, Advisor shall be deemed to have earned the compensation provided in Section 4(b) and such compensation shall be due and payable to Advisor pursuant to the terms of this Agreement; provided, however, that (i) Advisor substantially performed all of the duties and obligations that it would otherwise have under this Agreement if the Agreement had not terminated, and (ii) Advisor has given written notice to Company of the name of such buyer prior to the expiration of the term of this Agreement.

Compensation of Advisor. (a) The Company shall pay the Advisor as an acquisition fee 4.03.5% of Total Proceeds for services pursuant to this Agreement, subject to reduction under certain circumstances described herein. The Company shall pay acquisition fees payable from gross offering proceeds to the Advisor as the Company receives offering proceeds from the sale of shares. Acquisition fees shall be reduced to the extent that, and if necessary to limit, the total compensation paid to all persons involved in the acquisition of any property to the amount customarily charged in arms-length transactions by other persons or entities rendering similar services as an ongoing public activity in the same geographical location and for comparable types of properties, and to the extent that other acquisition fees, finder’s fees, real estate commissions or other similar fees or commissions are paid by any person in connection with the transaction. The total of all acquisition fees and any Acquisition Expenses shall be reasonable and shall not exceed an amount equal to six percent (6%) of the Contract Purchase Price of a Property unless a majority of the Board of Directors, including a majority of the Independent Directors, not otherwise interested in the transaction, approves fees in excess of these limits subject to a determination that the transaction is commercially competitive, fair and reasonable to the Company. (b) 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 shall receive a Subordinated Disposition Fee equal to the lesser of (i) one-half of a Competitive Real Estate Commission or (ii) 3% of the Contract Sales Price of such Property or Properties. The Subordinated Disposition Fee will be paid only if Stockholders have received total Distributions in an amount equal to the sum of their aggregate Invested Capital and their aggregate Stockholders’ 8% Return. To the extent that Subordinated Disposition Fees are not paid by the Company on a current basis due to the foregoing limitation, the unpaid fees will be accrued and paid at such time as the subordination conditions have been satisfied. The Subordinated Disposition Fee will be paid in addition to real estate commissions paid to non-affiliates, provided that the total real estate commissions and fees paid to all persons by the Company (including the Subordinated Disposition Fee) shall not exceed an amount equal 6% of the Contract Sales Price of a Property. If this Agreement is terminated prior to such time as the Stockholders have received total Distributions in an amount equal to 100% of Invested Capital plus an amount sufficient to pay the Stockholders’ 8% Return through the Termination Date, an Appraisal of the Properties then owned by the Company shall be made and the Subordinated Disposition Fee on Properties previously sold will be deemed earned if the Appraised Value of the Properties then owned by the Company plus total Distributions received prior to the Termination Date equals 100% of Invested Capital plus an amount sufficient to pay the Stockholders’ 8% Return through the Termination Date. Upon Listing, if the Advisor has accrued but not been paid such Subordinated Disposition Fee, then for purposes of determining whether the subordination conditions have been satisfied, Stockholders will be deemed to have received a Distribution in the amount equal to the product of the total number of Shares outstanding and the average closing price of the Shares over a period, beginning 180 days after Listing, of 30 days during which the Shares are traded. (c) In the event Company purchases, sells, conveys or otherwise transfers a Property within ninety (90) days after the expiration of this Agreement to a person or persons with whom Advisor on behalf of Company has negotiated as a prospective buyer of a Property during the term of this Agreement, Advisor shall be deemed to have earned the compensation provided in Section 4(b) and such compensation shall be due and payable to Advisor pursuant to the terms of this Agreement; provided, however, that (i) Advisor substantially performed all of the duties and obligations that it would otherwise have under this Agreement if the Agreement had not terminated, and (ii) Advisor has given written notice to Company of the name of such buyer prior to the expiration of the term of this Agreement.