0001025378
false
0001025378
2023-10-31
2023-10-31
iso4217:USD
xbrli:shares
iso4217:USD
xbrli:shares
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Date of report (Date of earliest event reported):
October 31, 2023
W. P. Carey Inc.
(Exact Name of Registrant as Specified in its Charter)
Maryland |
|
001-13779 |
|
45-4549771 |
(State of incorporation) |
|
(Commission File Number) |
|
(IRS Employer Identification No.) |
One Manhattan West, 395 9th Avenue,
58th Floor
New York, New York |
|
10001 |
(Address of principal executive offices) |
|
(Zip Code) |
Registrant’s telephone number, including
area code: (212) 492-1100
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.
below):
¨ | Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
|
Trading Symbol(s) |
|
Name of each exchange on which registered |
Common Stock, $0.001 Par Value |
|
WPC |
|
New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange
Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant
to Section 13(a) of the Exchange Act. ¨
Item 1.01 Entry into a Material Definitive Agreement.
On November 1, 2023, W. P. Carey Inc. (the “Company”)
completed the previously announced spin-off (the “Spin-Off”) of Net Lease Office Properties (“NLOP”),
pursuant to which the Company contributed certain office properties (the “Office Properties”) to NLOP (the contribution
transactions, the “Separation”) and thereafter effected a special dividend to its stockholders of all of the outstanding
common shares of beneficial interest of NLOP, $0.001 par value per share (the “NLOP Common Shares”) which were held
by the Company (the “Distribution”). In the Distribution, the Company distributed one NLOP Common Share for every 15
shares of common stock of the Company held of record as of close of business on October 19, 2023, the record date for the Distribution.
On October 31, 2023, in connection with the Spin-Off, the Company entered
into the Separation and Distribution Agreement and the Tax Matters Agreement, and, on November 1, 2023, the Company entered into the U.S.
Advisory Agreement and the European Advisory Agreement (each as defined below).
The Separation and Distribution were completed on November 1, 2023,
and, as a result thereof, NLOP became an independent, publicly traded real estate investment trust.
Separation and Distribution Agreement
The Separation and Distribution Agreement, dated October 31, 2023,
by and between the Company and NLOP (the “Separation and Distribution Agreement”) set forth the various individual
transactions to be consummated that comprised the Separation and the Distribution, including the assets transferred to and liabilities
assumed by NLOP and its subsidiaries following the Distribution, including the transfer of the Office Properties by the Company to NLOP
and the transfer by NLOP to the Company of approximately $382.4 million from borrowings under the NLOP Financing Arrangements (as defined
below).
The Separation and Distribution Agreement includes various post-closing
covenants, including agreements relating to insurance policies, information sharing and other operational matters. The Separation and
Distribution Agreement also includes a mutual release by the Company, on the one hand, and NLOP, on the other hand, of the other party
from certain specified liabilities, as well as mutual indemnification covenants pursuant to which the Company and NLOP have agreed to
indemnify each other from certain specified liabilities, including any claims relating to indebtedness associated with transfers of NLOP assets and any guaranties related thereto. The Separation and Distribution Agreement also contains provisions requiring
NLOP to pay (or, if paid by the Company, reimbursed by NLOP) all costs and expenses related to the Separation and Distribution.
The foregoing description of the Separation and
Distribution Agreement is a summary and does not purport to be complete, and is qualified in its entirety by reference to the full text
of the Separation and Distribution Agreement, which is attached as Exhibit 10.1 to this Current Report on Form 8-K (this “Current
Report”) and incorporated by reference herein.
Tax Matters Agreement
The Tax Matters Agreement dated October 31, 2023, by and between the
Company and NLOP (the “Tax Matters Agreement”) governs the respective rights, responsibilities and obligations of the
Company and NLOP after the Distribution with respect to tax liabilities and benefits, the preparation and filing of tax returns, the control
of audits and other tax proceedings, tax covenants, tax indemnification, cooperation and information sharing. The Tax Matters Agreement
provides that (a) NLOP and applicable subsidiaries will generally assume liability for all taxes reported, or required to be reported,
on an NLOP tax return following the Distribution, (b) the Company will assume liability for all taxes reported, or required to be reported,
on (i) a Company tax return or (ii) any joint tax return involving both the Company and NLOP following the Distribution, and (c) NLOP
will generally assume sole responsibility for any transfer taxes. The Company’s obligations under the Tax Matters Agreement are
not limited in amount or subject to any cap. If the Company is required to pay any liabilities under the circumstances set forth in the
Tax Matters Agreement or pursuant to applicable tax law, the amounts may be significant.
The foregoing description of the Tax Matters Agreement is a summary
and does not purport to be complete, and is qualified in its entirety by reference to the full text of the Tax Matters Agreement, which
is attached as Exhibit 10.2 to this Current Report and is incorporated by reference herein.
Advisory Agreements
On November 1, 2023, (i) NLOP and W. P. Carey Management LLC, a wholly-owned
subsidiary of the Company (the “U.S. Advisor”), entered into an advisory agreement (the “U.S. Advisory Agreement”);
and (ii) NLOP and W. P. Carey & Co. B.V., a wholly-owned subsidiary of the Company (the “European Advisor” and,
together with the U.S. Advisor, the “Advisors”), entered into an advisory agreement (the “European Advisory
Agreement” and, together with the U.S. Advisory Agreement, the “Advisory Agreements”), pursuant to which
the Advisors will provide NLOP with strategic management services, including asset management, property disposition support and various
related services. NLOP will pay management fees to the Advisors and will also reimburse the Advisors for certain expenses incurred in
providing services to NLOP.
Responsibilities and Authority
Subject to the authority of the board of trustees of NLOP (the “NLOP
Board”), the Advisors will:
| · | provide advice to NLOP, and act on NLOP’s behalf with respect to managing and monitoring the operating performance of the Office
Properties; |
| · | take the action and obtain the services necessary to source, investigate and evaluate prospective disposition, exchange or other transactions
with respect to the Office Properties; |
| · | assist the NLOP Board in developing and evaluating potential liquidity and disposition transactions for NLOP and take such actions
as may be requested by the NLOP Board or as may otherwise be necessary or desirable to execute any such transactions; and |
| · | provide management services related to NLOP’s business activities and performs various administrative services for NLOP as requested
by the NLOP Board. |
The actual terms and conditions of transactions involving the Office
Properties shall be determined in the sole discretion of the applicable Advisor, subject at all times to compliance with the delegation
of authority granted by the NLOP Board.
Term and Termination
The Advisory Agreements have an initial term of three years, and automatically
renew for successive one-year terms thereafter without further action by NLOP or the applicable Advisor. Each Advisory Agreement may also
be terminated (i) by the applicable Advisor no later than 180 days prior to the expiration of the initial term or any renewal term, as
applicable, or (ii) by NLOP upon 90 days’ prior written notice, or immediately for Cause (as defined in the Advisory Agreements).
Each applicable Advisor may also terminate the Advisory Agreement (x) immediately for Good Reason (as defined in the Advisory Agreements)
or (y) concurrently with or within 90 days following a termination of the other Advisory Agreement. Each Advisory Agreement may be amended
only by the written agreement of its parties. All amendments to either Advisory Agreement must be approved by a majority of the independent
trustees of the NLOP Board.
Fees and Reimbursements
NLOP will pay to the Advisors compensation for services they provide
to NLOP, including reimbursement for the costs related thereto. Specifically, NLOP will pay the Advisors a management fee of $625,000 per
calendar month, paid to the U.S. Advisor and allocated to the European Advisor by the Company, which will be subject to adjustment each
month described in the following sentence. Beginning with the first calendar month following the first disposition of a portfolio property
of NLOP, the management fee for the following calendar month shall be reduced proportionally by the contractual minimum annualized base
rent associated with such portfolio property of NLOP. In no event shall the management fees paid to the Advisors for a given calendar
month exceed the fees paid to the Advisors during the preceding calendar month, and in no event shall the aggregate management fees paid
to the Advisors for a given fiscal year exceed $7.5 million. Neither Advisor has yet received any compensation for the services contemplated
by the Advisory Agreement. The fees shall be payable monthly in arrears, and shall be in addition to the Advisors’ right to reimbursement
of expenses, as described below.
In addition, NLOP will be required to reimburse each Advisor and its
affiliates for other specified costs they may incur in connection with certain other services provided to NLOP pursuant to the applicable
Advisory Agreement, where those costs are not directly paid by NLOP. Specifically, NLOP will reimburse the Advisors a base administrative
reimbursement amount of $333,333.33 per calendar month, paid to the U.S. Advisor and allocated to the European Advisor by the Company,
for certain administrative services, including day-to-day management services, investor relations, accounting, tax, legal, and other administrative
matters. In addition to the administrative reimbursement amount, NLOP will reimburse the Advisors for specified out-of-pocket expenses
they incur in connection with their services.
The foregoing description of the Advisory Agreements is a summary and
does not purport to be complete, and is qualified in its entirety by reference to the full text of the U.S. Advisory Agreement and the
European Advisory Agreement, which are attached as Exhibits 10.3 and 10.4, respectively, to this Current Report and incorporated by reference
herein.
Item 1.02. Termination of a Material Definitive Agreement.
Financing Arrangements
As previously disclosed, on September 20, 2023, in connection with
the Separation, NLOP and certain of its wholly-owned direct and indirect subsidiaries entered into (i) a $335.0 million senior secured
mortgage loan (the “NLOP Mortgage Loan”) with JPMorgan Chase Bank. N.A., together with its successors and/or permitted
assigns (collectively, the “Lenders”) and (ii) a $120.0 million mezzanine loan facility with the Lenders (the “NLOP
Mezzanine Loan” and, together with the NLOP Mortgage Loan, the “NLOP Financing Arrangements”).
As a result of the Spin-Off, on November 1, 2023, NLOP became an independent
company, and NLOP and its subsidiaries ceased to be subsidiaries of the Company. Accordingly, the NLOP Financing Arrangements became the
sole obligations of NLOP and its subsidiaries, and the Company and its subsidiaries ceased to have any liability or obligations thereunder.
Item 5.02. Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Departure of Director
In connection with the Spin-Off, Jean Hoysradt notified the board of
directors of the Company (the “WPC Board”) on October 31,2023 of her decision to resign as a member of the WPC Board,
effective as of November 1, 2023, at which time Ms. Hoysradt was appointed to serve as a trustee on the NLOP Board. Ms. Hoysradt’s
resignation did not result from any disagreements with the Company or any matter relating to the Company’s operations, policies
or practices.
Item 7.01 Regulation FD Disclosure.
On November 1, 2023, the Company issued a press release announcing
the completion of the Spin-Off. A copy of the Company’s press release is attached hereto as Exhibit 99.1 and is incorporated herein
by reference.
The information furnished pursuant to this Item 7.01, including Exhibit
99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), or otherwise subject to the liability of that Section, and shall not be incorporated by reference
into any filing under the Securities Act of 1933, as amended, or the Exchange Act.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. |
|
Description |
10.1* |
|
Separation and Distribution Agreement, dated October 31, 2023, between W. P. Carey Inc. and Net Lease Office Properties. |
10.2* |
|
Tax Matters Agreement, dated October 31, 2023, between W. P. Carey Inc. and Net Lease Office Properties. |
10.3* |
|
Advisory Agreement, dated November 1, 2023, between W. P. Carey Management LLC and Net Lease Office Properties. |
10.4* |
|
Advisory Agreement, dated November 1, 2023, between W. P. Carey & Co. B.V. and Net Lease Office Properties. |
99.1 |
|
Press release of the Company dated November 1, 2023. |
104 |
|
Cover Page Interactive Data File (embedded within the Inline XBRL document). |
* Certain exhibits and schedules have been omitted pursuant
to Item 601(a)(5) of Regulation S-K. The Company hereby undertakes to furnish supplemental copies of any of the omitted exhibits and
schedules upon request by the SEC; provided, however, that the Company may request confidential treatment pursuant to Rule 24b-2 of the
Exchange Act for any exhibits or schedules so furnished.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
| |
W. P. Carey Inc. |
| |
Date: |
November 2, 2023 | By: |
/s/
ToniAnn Sanzone |
| |
ToniAnn
Sanzone |
| |
Chief Financial Officer |
Exhibit 10.1
SEPARATION AND DISTRIBUTION AGREEMENT
by and between
W.
P. Carey Inc.
and
NET LEASE OFFICE PROPERTIES
dated as of
October 31, 2023
TABLE OF CONTENTS
Page
Article I
DEFINITIONS |
1 |
|
|
Section 1.1 |
Definitions |
1 |
Section 1.2 |
Interpretation |
9 |
|
|
|
Article II
THE SEPARATION |
10 |
|
|
Section 2.1 |
Separation Transactions |
10 |
Section 2.2 |
Transfers of Assets and Assumptions of Liabilities |
10 |
Section 2.3 |
Release of Guarantees |
12 |
Section 2.4 |
Termination of Intercompany Agreements. |
13 |
Section 2.5 |
Settlement of Intercompany Account |
14 |
Section 2.6 |
Bank Accounts |
14 |
Section 2.7 |
Rent Allocations |
14 |
|
|
|
Article III
CERTAIn actions prior to the distributioN |
14 |
|
|
Section 3.1 |
SEC and Other Securities Filings |
14 |
Section 3.2 |
NYSE Listing Application |
15 |
Section 3.3 |
Distribution Agent Agreement |
15 |
Section 3.4 |
NLOP Advisory Agreements |
15 |
Section 3.5 |
Governmental Approvals and Consents |
15 |
Section 3.6 |
Ancillary Agreements |
15 |
Section 3.7 |
Governance Matters |
15 |
|
|
|
Article IV
THE DISTRIBUTION |
16 |
|
|
Section 4.1 |
Dividend to WPC |
16 |
Section 4.2 |
Delivery to Distribution Agent |
16 |
Section 4.3 |
Mechanics of the Distribution |
16 |
|
|
|
Article V
CONDITIONS |
17 |
|
|
Section 5.1 |
Conditions Precedent to Consummation of the Distribution |
17 |
Section 5.2 |
Right Not to Close |
18 |
|
|
|
Article VI
NO REPRESENTATIONS OR WARRANTIES |
18 |
|
|
Section 6.1 |
Disclaimer of Representations and Warranties |
18 |
Section 6.2 |
As Is, Where Is |
18 |
|
|
|
Article VII
CERTAIN COVENANTS AND ADDITIONAL AGREEMENTS |
19 |
|
|
Section 7.1 |
Insurance Matters |
19 |
Section 7.2 |
No Restrictions on Post-Closing Competitive Activities;
Corporate Opportunities |
20 |
Section 7.3 |
Cooperation |
22 |
|
|
|
Article VIII
ACCESS TO INFORMATION; CONFIDENTIALITY; PRIVILEGE |
22 |
|
|
Section 8.1 |
Agreement for Exchange of Information |
22 |
Section 8.2 |
Ownership of Information |
22 |
Section 8.3 |
Compensation for Providing Information |
23 |
Section 8.4 |
Retention of Records |
23 |
Section 8.5 |
Limitation of Liability |
23 |
Section 8.6 |
Production of Witnesses |
23 |
Section 8.7 |
Confidentiality |
24 |
Section 8.8 |
Privileged Matters |
24 |
Section 8.9 |
Financial Information Certifications |
26 |
|
|
|
Article IX
MUTUAL RELEASES; INDEMNIFICATION |
26 |
|
|
Section 9.1 |
Release of Pre-Distribution Claims |
26 |
Section 9.2 |
Indemnification by NLOP |
27 |
Section 9.3 |
Indemnification by WPC |
28 |
Section 9.4 |
Procedures for Indemnification |
28 |
Section 9.5 |
Indemnification Obligations Net of Insurance Proceeds |
30 |
Section 9.6 |
Contribution |
31 |
Section 9.7 |
Remedies Cumulative |
31 |
Section 9.8 |
Survival of Indemnities |
31 |
Section 9.9 |
Limitation of Liability |
31 |
|
|
|
Article X
DISPUTE RESOLUTION |
31 |
|
|
Section 10.1 |
Appointed Representative |
31 |
Section 10.2 |
Negotiation and Dispute Resolution |
31 |
Section 10.3 |
Arbitration |
32 |
|
|
|
Article XI
TERMINATION |
33 |
|
|
Section 11.1 |
Termination |
33 |
Section 11.2 |
Effect of Termination |
34 |
|
|
|
Article XII
MISCELLANEOUS |
34 |
|
|
Section 12.1 |
Further Assurances |
34 |
Section 12.2 |
Payment of Expenses |
34 |
Section 12.3 |
Amendments and Waivers |
34 |
Section 12.4 |
Entire Agreement |
34 |
Section 12.5 |
Survival of Agreements |
35 |
Section 12.6 |
Third Party Beneficiaries |
35 |
Section 12.7 |
Notices |
35 |
Section 12.8 |
Counterparts; Electronic Delivery |
35 |
Section 12.9 |
Severability |
35 |
Section 12.10 |
Assignability; Binding Effect |
36 |
Section 12.11 |
Governing Law |
36 |
Section 12.12 |
Construction |
36 |
Section 12.13 |
Performance |
36 |
Section 12.14 |
Title and Headings |
36 |
Section 12.15 |
Exhibits and Schedules |
36 |
Section 12.16 |
Exclusivity of Tax Matters |
36 |
Exhibit A: |
NLOP Subsidiaries |
|
|
Exhibit B: |
Tax Matters Agreement |
|
|
Exhibit C: |
US Advisory Agreement |
|
|
Exhibit D: |
European Advisory Agreement |
SEPARATION AND DISTRIBUTION AGREEMENT
This SEPARATION AND DISTRIBUTION
AGREEMENT (this “Agreement”) is entered into as of October 31, 2023, by and between W. P. Carey Inc., a Maryland
corporation (“WPC”), and Net Lease Office Properties, a Maryland real estate investment trust and wholly owned subsidiary
of WPC (“NLOP”). WPC and NLOP are sometimes referred to herein individually as a “Party” and collectively
as the “Parties.” Capitalized terms used but not otherwise defined herein shall have the respective meanings set forth
in Section 1.1.
RECITALS
WHEREAS, WPC, through its
Subsidiaries, has previously acquired the NLOP Assets;
WHEREAS, the board of directors
of WPC has determined that it is advisable and in the best interests of WPC to cause the NLOP Assets to be owned by NLOP and its Subsidiaries
and to establish NLOP as an independent publicly traded company; and
WHEREAS, pursuant to the
terms of this Agreement, the Parties intend to effect the separation of WPC and NLOP by distributing to the holders of WPC’s outstanding
shares of common stock, par value $0.001 per share (“WPC Common Stock”), on a pro rata basis, all of the common shares
of beneficial interest, $0.001 par value per share, of NLOP (“NLOP Common Shares”), owned by WPC as of the Distribution
Date (which shall represent 100% of the issued and outstanding NLOP Common Shares).
NOW, THEREFORE, in consideration
of the foregoing and the covenants and agreements set forth below and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, and intending to be legally bound hereby, the Parties hereby agree as follows:
Article I
DEFINITIONS
Section 1.1 Definitions.
As used in this Agreement, the following terms shall have the meanings set forth in this Section 1.1:
“AAA”
has the meaning set forth in Section 10.3(a).
“Action”
means any demand, claim, action, suit, countersuit, arbitration, litigation, inquiry, proceeding or investigation by or before any Governmental
Authority or any arbitration or mediation tribunal or authority.
“Affiliate”
means, with respect to any specified Person, any other Person that directly, or indirectly through one or more intermediaries, controls,
is controlled by, or is under common control with, the specified Person; provided, however, that, following the Distribution, (a) no
member of the NLOP Group shall be deemed to be an Affiliate of any member of the WPC Group and (b) no member of the WPC Group shall
be deemed to be an Affiliate of any member of the NLOP Group. For this purpose, “control” of a Person means the possession,
directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through ownership
of voting securities, by contract or otherwise.
“Agreement”
has the meaning set forth in the preamble to this Agreement and includes all Exhibits and Schedules attached hereto or delivered pursuant
hereto.
“Agreement Dispute”
has the meaning set forth in Section 10.2(a).
“Ancillary Agreements”
has the meaning set forth in Section 3.6.
“Appellate Rules”
has the meaning set forth in Section 10.3(g).
“Appointed Representative”
has the meaning set forth in Section 10.1.
“Appropriate Member
of the NLOP Group” has the meaning set forth in Section 9.2.
“Appropriate Member
of the WPC Group” has the meaning set forth in Section 9.3.
“Asset”
means all rights, properties or other assets, whether real, personal or mixed, tangible or intangible, of any kind, nature and description,
whether accrued, contingent or otherwise, and wheresoever situated and whether or not carried or reflected, or required to be carried
or reflected, on the books of any Person.
“Award”
has the meaning set forth in Section 10.3(e).
“Business Day”
means a day other than a Saturday, a Sunday or a day on which banking institutions located in the State of New York are authorized or
obligated by applicable Law or executive order to close.
“Code”
means the Internal Revenue Code of 1986, as amended.
“Confidential Information”
means any and all information:
(a) that
is required to be maintained in confidence by any Law or under any Contract;
(b) concerning
market studies, business plans, computer hardware, computer software (including all versions, source and object codes and all related
files and data), software and database technologies, systems, structures and architectures, and other similar technical or business information;
(c) concerning
any business and its affairs, which includes earnings reports and forecasts, macro-economic reports and forecasts, business and strategic
plans, general market evaluations and surveys, litigation presentations and risk assessments, financing and credit-related information,
financial projections, tax returns and accountants’ materials, business plans, strategic plans, Contracts, however documented,
and other similar financial or business information;
(d) constituting
communications by or to attorneys (including attorney-client privileged communications), memos and other materials prepared by attorneys
or under their direction (including attorney work product), communications and materials otherwise related to or made or prepared in
connection with or in preparation for any legal proceeding; or
(e) constituting
notes, analyses, compilations, studies, summaries and other material that contain or are based, in whole or in part, upon any information
included in the foregoing clauses (a) through (d).
“Consent”
means any consent, waiver or approval from, or notification requirement to, any Person other than a member of either Group.
“Contract”
means any written, oral, implied or other contract, agreement, covenant, lease, license, guaranty, indemnity, representation, warranty,
assignment, sales order, purchase order, power of attorney, instrument or other commitment, assurance, undertaking or arrangement that
is binding on any Person or entity or any part of its property under applicable Law.
“Deferred Asset”
has the meaning set forth in Section 2.2(b).
“Deferred Liability”
has the meaning set forth in Section 2.2(b).
“Distribution”
means the transactions contemplated by Section 4.3.
“Distribution Agent”
means Computershare Trust Company, N.A.
“Distribution Date”
means the date on which the Distribution occurs, such date to be determined by, or under the authority of, the board of directors of
WPC, in its sole and absolute discretion.
“Distribution Ratio”
has the meaning set forth in Section 4.3(a).
“Effective Time”
means the time at which the Distribution is effective on the Distribution Date.
“Exchange Act”
means the Securities Exchange Act of 1934, as amended.
“Governmental Approval”
means any notice, report or other filing to be given to or made with, or any release, consent, substitution, approval, amendment, registration,
permit or authorization from, any Governmental Authority.
“Governmental Authority”
means any U.S. federal, state, local or non-U.S. court, government, department, commission, board, bureau, agency, official or other
regulatory, administrative or governmental authority.
“Group”
means either the WPC Group or the NLOP Group, as the context requires.
“Guarantee”
means any guarantee (including guarantees of performance or payment under Contracts, commitments, Liabilities and permits), letter of
credit or other credit or credit support arrangement or similar assurance, including surety bonds, bid bonds, advance payment bonds,
performance bonds, payment bonds, retention and/or warranty bonds or other bonds or similar instruments.
“Indebtedness”
of any specified Person means (a) all obligations of such specified Person for borrowed money or arising out of any extension of
credit to or for the account of such specified Person (including reimbursement or payment obligations with respect to surety bonds, letters
of credit, bankers’ acceptances and similar instruments), (b) all obligations of such specified Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such specified Person upon which interest charges are customarily
paid, (d) all obligations of such specified Person under conditional sale or other title retention agreements relating to Assets
purchased by such specified Person, (e) all obligations of such specified Person issued or assumed as the deferred purchase price
of property or services, (f) all Liabilities secured by (or for which any Person to which any such Liability is owed has an existing
right, contingent or otherwise, to be secured by) any mortgage, lien, pledge or other encumbrance on property owned or acquired by such
specified Person (or upon any revenues, income or profits of such specified Person therefrom), whether or not the obligations secured
thereby have been assumed by the specified Person or otherwise become Liabilities of the specified Person, (g) all capital lease
obligations of such specified Person, (h) all securities or other similar instruments convertible or exchangeable into any of the
foregoing, and (i) any Liability of others of a type described in any of the preceding clauses (a) through (h) in respect
of which the specified Person has incurred, assumed or acquired a Liability by means of a Guarantee.
“Indemnifiable Loss”
has the meaning set forth in Section 9.5.
“Indemnifying Party”
has the meaning set forth in Section 9.4(a).
“Indemnitee”
means any WPC Indemnitee or any NLOP Indemnitee.
“Indemnity Payment”
has the meaning set forth in Section 9.5.
“Information Statement”
means the information statement, attached as an exhibit to the Registration Statement, and any related documentation to be provided to
holders of WPC Common Stock in connection with the Distribution, including any amendments or supplements thereto.
“Insurance Policy”
means any insurance policies and insurance Contracts, including general liability, property and casualty, environmental liability, umbrella,
workers’ compensation, automobile, directors and officers liability, errors and omissions, employee dishonesty and fiduciary liability
policies, whether, in each case, in the nature of primary, excess, umbrella or self-insurance overage, together with all rights, benefits
and privileges thereunder.
“Insurance Proceeds”
means those monies (in each case, net of any out-of-pocket costs or expenses incurred in the collection thereof):
(a) received
by an insured Person from any insurer, insurance underwriter, mutual protection and indemnity club or other risk collective, excluding
any proceeds received directly or indirectly (such as through reinsurance arrangements) from any captive insurance Subsidiary of the
insured Person; or
(b) paid
on behalf of an insured Person by any insurer, insurance underwriter, mutual protection and indemnity club or other risk collective,
excluding any such payment made directly or indirectly (such as through reinsurance arrangements) from any captive insurance Subsidiary
of the insured Person, on behalf of the insured.
“Insurance Termination
Date” has the meaning set forth in Section 7.1(d).
“Insured Party”
has the meaning set forth in Section 7.1(d).
“Intercompany Account”
means any receivable, payable or loan between any member of the WPC Group, on the one hand, and any member of the NLOP Group, on the
other hand, that exists prior to the Effective Time and is reflected in the records of the relevant members of the WPC Group and the
NLOP Group, except for any such receivable, payable or loan that arises pursuant to this Agreement or any Ancillary Agreement.
“Intercompany Agreement”
means any Contract, whether or not in writing, between or among any member of the WPC Group, on the one hand, and any member of the NLOP
Group, on the other hand, entered into prior to the Distribution Date, but excluding any Contract to which a Person other than any member
of the WPC Group or the NLOP Group is also a party.
“Investment Company
Act” means the Investment Company Act of 1940, as amended.
“IRS”
means the United States Internal Revenue Service or any successor agency.
“Law”
means any law, statute, ordinance, code, rule, regulation, order, writ, proclamation, judgment, injunction or decree of any Governmental
Authority.
“Lenders”
means JPMorgan Chase Bank, N.A., together with its successors and/or permitted assigns.
“Liabilities”
means any and all Indebtedness, liabilities and obligations, including environmental liabilities, whether accrued, fixed or contingent,
mature or inchoate, known or unknown, reflected on a balance sheet or otherwise, including those arising under any Law, Action or any
judgment of any Governmental Authority or any award of any arbitrator of any kind, and those arising under any Contract.
“Linked”
has the meaning set forth in Section 2.6(a).
“Loss Party”
has the meaning set forth in Section 7.1(d).
“Losses”
means any and all damages, losses, deficiencies, Liabilities, obligations, penalties, judgments, settlements, claims, payments, interest
costs, Taxes, fines and expenses (including the costs and expenses of any and all Actions and demands, assessments, judgments, settlements
and compromises relating thereto and attorneys’, accountants’, consultants’ and other professionals’ fees and
expenses incurred in the investigation or defense thereof or the enforcement of rights hereunder).
“Mortgaged Properties” means
the real properties securing the NLOP Mortgage Loan.
“NLOP”
has the meaning set forth in the preamble to this Agreement.
“NLOP Accounts”
has the meaning set forth in Section 2.6(a).
“NLOP Advisors”
means the NLOP US Advisor and the NLOP European Advisor, together with their Affiliates.
“NLOP Advisory Agreements”
means the US Advisory Agreement and the European Advisory Agreement.
“NLOP Assets”
means, except as set forth in Sections 2.5 and 2.6, all of the equity of the NLOP Subsidiaries and all of the other assets
owned or to be owned by the NLOP Subsidiaries immediately following the transactions described in Section 2.1, including
the assets set forth in Section 1.1(a) of the Disclosure Schedule, and all of the other Assets held or to be held by
NLOP set forth on Section 1.1(b) of the Disclosure Schedule. For the avoidance of doubt, the NLOP Assets shall include,
but not be limited to, all Assets recorded on the NLOP Balance Sheet; provided, that the amounts set forth on the NLOP Balance
Sheet with respect to any Assets shall not be treated as minimum or maximum amounts or limitations on the amount of such Assets that
are included in the definition of NLOP Assets.
“NLOP Balance Sheet”
means the Unaudited Pro Forma Combined Balance Sheet as of June 30, 2023, as included in the Information Statement.
“NLOP Business”
means the businesses, operations, activities, Assets and Liabilities of WPC and its Subsidiaries prior to the Transactions related to
the real properties set forth in Section 1.1(a) of the Disclosure Schedule (other than the WPC Business).
“NLOP Common Shares”
has the meaning set forth in the recitals to this Agreement.
“NLOP European Advisor”
means W. P. Carey & Co. B.V., a wholly owned subsidiary of WPC.
“NLOP European Advisory
Agreement” means the European Advisory Agreement to be entered into between NLOP and the European Advisor, substantially in
the form attached hereto as Exhibit D, as such agreement may be modified or amended from time to time in accordance with
its terms.
“NLOP Financing
Arrangements” means the NLOP Mortgage Loan and the NLOP Mezzanine Loan.
“NLOP Group”
means NLOP and the NLOP Subsidiaries.
“NLOP Indemnitees”
means each member of the NLOP Group and their Affiliates and each of their respective current or former stockholders, trustees, directors,
officers, agents and employees (in each case, in such Person’s respective capacity as such) and their respective heirs, executors,
administrators, successors and assigns.
“NLOP Liabilities”
means, except as otherwise expressly provided in this Agreement or one or more of the Ancillary Agreements:
(a) all
Liabilities relating to or arising out of the NLOP Assets whether arising prior to, at the time of, or after the Effective Time, including
(i) Indebtedness of NLOP or a NLOP Subsidiary that is outstanding at the Effective Time, including mortgage debt relating to the
NLOP Assets, (ii) any known or unknown disputes or claims with respect to tenants, property sellers, Governmental Authorities or
other third parties relating to the NLOP Business, including all contracts entered into in the name of, or expressly on behalf of, the
NLOP Business, including all leases related to the NLOP Assets and all other contractual obligations with respect to service providers,
tenants, property sellers and other third parties, and (iii) any insurance charges related to the NLOP Business or the NLOP Assets
pursuant to any Insurance Policy held by WPC or NLOP for the benefit of the NLOP Business and NLOP Assets;
(b) all
Liabilities recorded on the NLOP Balance Sheet, subject to the satisfaction of any Liabilities subsequent to the date of the NLOP Balance
Sheet; provided that the amounts set forth on the NLOP Balance Sheet with respect to any Liabilities shall not be treated as minimum
or maximum amounts or limitations on the amount of such Liabilities that are included in the definition of NLOP Liabilities pursuant
to this clause (b);
(c) the
NLOP Financing Arrangements, and any expenses or Liabilities related thereto;
(d) any
potential Liabilities with respect to matters identified on, and subject to the limitations set forth on, Section 1.2 of
the Disclosure Schedule;
(e) all
Liabilities arising out of claims made by NLOP’s trustees, officers and Affiliates after the Effective Time against WPC or NLOP,
to the extent relating to the NLOP Assets; and
(f) all
Liabilities that are expressly created by this Agreement or any Ancillary Agreement (or the Schedules hereto or thereto) as Liabilities
to be assumed or retained by NLOP or any other member of the NLOP Group, and all agreements, obligations and Liabilities of any member
of the NLOP Group under this Agreement or any of the Ancillary Agreements.
“NLOP Mezzanine
Borrower” means a subsidiary of NLOP, which is expected to directly or indirectly own 100% of the equity of the NLOP Mortgage
Loan Borrowers immediately following the Separation.
“NLOP Mezzanine
Loan” means the $120.0 million mezzanine loan facility entered into between the NLOP Mezzanine Borrower and the Lenders pursuant
to that certain Mezzanine Loan Agreement, dated September 20, 2023, between NLO Mezzanine Borrower LLC and JPMorgan Chase Bank,
N.A., and the documents related thereto.
“NLOP Mortgage Loan”
means the $335.0 million senior secured mortgage loan entered into among the NLOP Mortgage Loan Borrowers and the Lenders pursuant to
that certain Loan Agreement, dated September 20, 2023, by and among JPMorgan Chase Bank, N.A. and the borrowers named therein, and
the documents related thereto.
“NLOP Mortgage Loan
Borrowers” means certain subsidiaries of NLOP, which are expected to collectively own the Mortgaged Properties immediately
following the Separation.
“NLOP US Advisor”
means W. P. Carey Management LLC, a wholly owned subsidiary of WPC.
“NLOP US Advisory
Agreement” means the US Advisory Agreement to be entered into between NLOP and the US Advisor, substantially in the form attached
hereto as Exhibit C, as such agreement may be modified or amended from time to time in accordance with its terms.
“NLOP Subsidiaries”
means the Subsidiaries of NLOP listed in Exhibit A, and any Subsidiary of NLOP formed after the date of this Agreement and
prior to the Distribution Date.
“NYSE”
means the New York Stock Exchange.
“NYSE Listing Application”
has the meaning set forth in Section 3.2(a).
“Party”
or “Parties” has the meaning set forth in the preamble to this Agreement.
“Period”
has the meaning set forth in Section 8.1(a).
“Person”
means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint
venture, a union, an unincorporated organization or a governmental entity or any department, agency or political subdivision thereof.
“Record Date”
means the close of business on the date, to be determined by the board of directors of WPC, as the record date for determining holders
of WPC Common Stock entitled to receive NLOP Common Shares in the Distribution.
“Record Holders”
has the meaning set forth in Section 4.2.
“Registration Statement”
means the registration statement on Form 10 of NLOP with respect to the registration under the Exchange Act of the NLOP Common Shares
to be distributed in the Distribution, including any amendments or supplements thereto.
“Rules”
has the meaning set forth in Section 10.3(a).
“SEC”
means the United States Securities and Exchange Commission.
“Security Interests”
means any mortgage, security interest, pledge, lien, charge, claim, option, indenture, right to acquire, right of first refusal, deed
of trust, licenses to third parties, leases to third parties, security agreements, voting or other restriction, covenant, condition,
restriction, encroachment, restriction on transfer, restrictions or limitations on use of real or personal property or any other encumbrance
of any nature whatsoever, imperfections in or failure of title or defect of title.
“Separation”
means the transactions contemplated by Article II.
“Subsidiary”
means, with respect to any specified Person, any corporation, partnership, limited liability company, joint venture or other organization,
whether incorporated or unincorporated, of which at least a majority of the securities or interests having by the terms thereof ordinary
voting power to elect at least a majority of the board of directors or others performing similar functions with respect to such corporation
or other organization is directly or indirectly owned or controlled by such specified Person or by any one or more of its subsidiaries,
or by such specified Person and one or more of its subsidiaries.
“Tax Matters Agreement”
means the Tax Matters Agreement to be entered into between WPC and NLOP, substantially in the form attached as Exhibit B
hereto, as such agreement may be modified or amended from time to time in accordance with its terms.
“Tax”
has the meaning set forth in the Tax Matters Agreement.
“Tax Authority”
has the meaning set forth in the Tax Matters Agreement.
“Third-Party Claim”
has the meaning set forth in Section 9.4(b).
“Transactions”
means the Separation, the Distribution and any other transactions contemplated by this Agreement or any Ancillary Agreement.
“Treasury Regulations”
has the meaning set forth in the Tax Matters Agreement.
“WPC”
has the meaning set forth in the preamble to this Agreement.
“WPC Accounts”
has the meaning set forth in Section 2.6(a).
“WPC Assets”
means all Assets owned, directly or indirectly, by WPC, other than any NLOP Assets.
“WPC Business”
means shall mean, other than the NLOP Business, the businesses, operations and activities of WPC and the WPC Group.
“WPC Common Stock”
has the meaning set forth in the recitals to this Agreement.
“WPC Group”
means WPC and the Subsidiaries of WPC other than NLOP and the NLOP Subsidiaries.
“WPC Indemnitees”
means each member of the WPC Group and its Affiliates (other than NLOP and the NLOP Subsidiaries) and each of their respective current
or former stockholders, directors, officers, agents and employees (in each case, in such Person’s respective capacity as such)
and their respective heirs, executors, administrators, successors and assigns.
“WPC Liabilities”
means any Liabilities of WPC or any of its Subsidiaries, other than any NLOP Liabilities.
Section 1.2 Interpretation.
In this Agreement and the Ancillary Agreements, unless the context clearly indicates otherwise:
(a) words
used in the singular include the plural and words used in the plural include the singular;
(b) the
words “include,” “includes” and “including” shall be deemed to be followed by the words “without
limitation”;
(c) the
word “or” shall have the inclusive meaning represented by the phrase “and/or”;
(d) relative
to the determination of any period of time, “from” means “from and including,” “to” means “to
but excluding” and “through” means “through and including”;
(e) accounting
terms used herein shall have the meanings historically ascribed to them by WPC and its Subsidiaries in its and their internal accounting
and financial policies and procedures in effect immediately prior to the date of this Agreement;
(f) reference
to any agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented and modified
from time to time to the extent permitted by the provisions thereof and by this Agreement;
(g) reference
to any Law means such Law (including any and all rules and regulations promulgated thereunder) as amended, modified, codified or
reenacted, in whole or in part, and in effect at the time of determining compliance or applicability;
(h) references
to any Person include such Person’s successors and assigns but, if applicable, only if such successors and assigns are permitted
by this Agreement; any reference to a third party shall be deemed to mean a Person who is not a Party or an Affiliate of a Party;
(i) if
there is any conflict between the provisions of the main body of this Agreement or an Ancillary Agreement and the Exhibits and Schedules
hereto or thereto, the provisions of the main body of this Agreement or the Ancillary Agreement, as applicable, shall control unless
explicitly stated otherwise in such Schedule;
(j) if
there is any conflict between the provisions of this Agreement and any Ancillary Agreement, the provisions of such Ancillary Agreement
shall control (but only with respect to the subject matter thereof) unless explicitly stated otherwise therein; and
(k) any
portion of this Agreement or any Ancillary Agreement obligating a Party to take any action or refrain from taking any action, as the
case may be, shall mean that such Party shall also be obligated to cause its relevant Subsidiaries to take such action or refrain from
taking such action, as the case may be.
Article II
THE
SEPARATION
Section 2.1 Separation
Transactions. On or prior to the Distribution Date, WPC shall, and shall cause NLOP and each other Subsidiary and controlled Affiliate
of WPC to, effect each of the transactions set forth in Section 2.1 of the Disclosure Schedule, which transactions shall
be accomplished in the order described thereon, and subject to the limitations set forth therein, in each case, with such modifications,
if any, as WPC shall determine are necessary or desirable for efficiency or similar purposes.
Section 2.2 Transfers
of Assets and Assumptions of Liabilities.
(a) Transfer
of Assets and Assumption of Liabilities Prior to Effective Time. Subject to Section 2.1 and Section 2.2(b),
in accordance with Section 2.1 of the Disclosure Schedule and to the extent not previously effected prior to the date hereof
pursuant to Section 2.1 of the Disclosure Schedule, WPC and NLOP agree to take all actions necessary so that, immediately
prior to the Effective Time, (i) the NLOP Group will own, to the extent it does not already own, all of the NLOP Assets and none
of the WPC Assets, and (ii) the NLOP Group will assume, to the extent it is not already liable for, all NLOP Liabilities. For the
avoidance of doubt, Section 2.1 of the Disclosure Schedule shall take precedence in the event of any conflict between the
terms of this Article II and Section 2.1 of the Disclosure Schedule, and any transfers of assets or liabilities
made pursuant to this Agreement or any Ancillary Agreement after the Effective Time shall be deemed to have been made prior to the Effective
Time consistent with Section 2.1 of the Disclosure Schedule.
(b) Deferred
Transfers and Assumptions.
(i) Nothing
in this Agreement or in any Ancillary Agreement will be deemed to require the transfer of any Assets or the assumption of any Liabilities
that by their terms or by operation of Law cannot be transferred or assumed.
(ii) To
the extent that any transfer of Assets or assumption of Liabilities contemplated by this Agreement or any Ancillary Agreement is not
consummated prior to the Effective Time as a result of an absence or non-satisfaction of any required Consent, Governmental Approval
and/or other condition (such Assets or Liabilities, a “Deferred Asset” or a “Deferred Liability,”
as applicable), the Parties will use commercially reasonable efforts to effect such transfers or assumptions as promptly following the
Effective Time as practicable. If and when the Consents, Governmental Approvals and/or other conditions, the absence or non-satisfaction
of which gave rise to the Deferred Asset or Deferred Liability, are obtained or satisfied, the transfer or assumption of the Deferred
Asset or Deferred Liability will be effected in accordance with and subject to the terms of this Agreement or the applicable Ancillary
Agreement, if any.
(iii) From
and after the Effective Time until such time as the Deferred Asset or Deferred Liability is transferred or assumed, as applicable, (A) the
Party retaining such Deferred Asset will thereafter hold such Deferred Asset for the use and benefit of the Party entitled thereto (at
the expense of the Party entitled thereto) and (B) the Party intended to assume such Deferred Liability will pay or reimburse the
Party retaining such Deferred Liability for all amounts paid or incurred in connection with the retention of such Deferred Liability;
it being agreed that the Party retaining such Deferred Asset or Deferred Liability will not be obligated, in connection with the foregoing
clause (A) and clause (B), to expend any money unless the necessary funds are advanced or agreed in writing to be reimbursed by
the Party entitled to such Deferred Asset or intended to assume such Deferred Liability. The Party retaining the Deferred Asset or Deferred
Liability will use its commercially reasonable efforts to notify the Party entitled to or intended to assume such Deferred Asset or Deferred
Liability of the need for such expenditure. In addition, the Party retaining such Deferred Asset or Deferred Liability will, insofar
as reasonably practicable and to the extent permitted by applicable Law, (A) treat such Deferred Asset or Deferred Liability in
the ordinary course of business consistent with past practice, (B) promptly take such other actions as may be requested by the Party
entitled to such Deferred Asset or by the Party intended to assume such Deferred Liability in order to place such Party in the same position
as if the Deferred Asset or Deferred Liability had been transferred or assumed, as applicable, as contemplated hereby, and so that all
the benefits and burdens relating to such Deferred Asset or Deferred Liability, including possession, use, risk of loss, potential for
gain, and control over such Deferred Asset or Deferred Liability, are to inure from and after the Effective Time to such Party entitled
to such Deferred Asset or intended to assume such Deferred Liability and (C) hold itself out (including by providing notice, as
applicable) to third parties as agent or nominee on behalf of the Party entitled to such Deferred Asset or intended to assume such Deferred
Liability.
(iv) In
furtherance of the foregoing, the Parties agree that, as of the Effective Time, each Party will be deemed to have acquired beneficial
ownership of all of the Assets, together with all rights and privileges incident thereto, and will be deemed to have assumed all of the
Liabilities, and all duties, obligations and responsibilities incident thereto, that such Party is entitled to acquire or intended to
assume pursuant to the terms of this Agreement or the applicable Ancillary Agreement, if any.
(v) The
Parties agree to treat, for all Tax purposes, any Asset or Liability that is not transferred or assumed prior to the Effective Time and
which is subject to the provisions of this Section 2.2(b), as (A) owned by the Party to which such Asset was intended
to be transferred or by the Party which was intended to assume such Liability, as the case may be, from and after the Effective Time,
(B) having not been owned by the Party retaining such Asset or Liability, as the case may be, at any time from and after the Effective
Time, and (C) having been held by the Party retaining such Asset or Liability, as the case may be, only as agent or nominee on behalf
of the other Party from and after the Effective Time until the date such Asset or Liability, as the case may be, is transferred to or
assumed by such other Party. The Parties will not take any position inconsistent with the foregoing unless otherwise required by applicable
Law (in which case, the Parties will provide indemnification for any Taxes attributable to the Asset or Liability during the period beginning
on the Distribution Date and ending on the date of the actual transfer).
(c) Misallocated
Assets and Liabilities.
(i) In
the event that, at any time from and after the Effective Time, either Party discovers that it or another member of its Group is the owner
of, receives or otherwise comes to possess or benefit from any Asset (including the receipt of payments made pursuant to Contracts and
proceeds from accounts receivable with respect to such Asset) that should have been allocated to a member of the other Group pursuant
to this Agreement or any Ancillary Agreement (except in the case of any deliberate acquisition of Assets from a member of the other Group
for value subsequent to the Effective Time), such Party shall promptly transfer, or cause to be transferred, such Asset to such member
of the other Group, and such member of the other Group shall accept such Asset for no further consideration other than that set forth
in this Agreement and such Ancillary Agreement. Prior to any such transfer, such Asset shall be held in accordance with Section 2.2(b).
(ii) In
the event that, at any time from and after the Effective Time, either Party discovers that it or another member of its Group is liable
for any Liability that should have been allocated to a member of the other Group pursuant to this Agreement or any Ancillary Agreement
(except in the case of any deliberate assumption of Liabilities from a member of the other Group for value subsequent to the Effective
Time), such Party shall promptly transfer, or cause to be transferred, such Liability to such member of the other Group and such member
of the other Group shall assume such Liability for no further consideration than that set forth in this Agreement and such Ancillary
Agreement. Prior to any such assumption, such Liabilities shall be held in accordance with Section 2.2(b).
(d) Instruments
of Transfer and Assumption. The Parties agree that (i) transfers of Assets that may be required by this Agreement or any Ancillary
Agreement shall be effected by delivery by the transferor to the transferee of (A) with respect to those Assets that constitute
stock or other equity interests, certificates endorsed in blank or evidenced or accompanied by stock powers or other instruments of transfer
endorsed in blank, against receipt and (B) with respect to all other Assets, such good and sufficient instruments of contribution,
conveyance, assignment and transfer, in form and substance reasonably satisfactory to the Parties, as shall be necessary, in each case,
to vest in the designated transferee all of the title and ownership interest of the transferor in and to any such Asset, and (ii) the
assumptions of Liabilities required by this Agreement or any Ancillary Agreement shall be effected by delivery by the transferee to the
transferor of such good and sufficient instruments of assumption, in form and substance reasonably satisfactory to the Parties, as shall
be necessary, in each case, for the assumption by the transferee of such Liabilities. Each Party hereby waives compliance by each other
Party and its respective Group members with the requirements and provisions of any “bulk-sale” or “bulk-transfer”
Laws of any jurisdiction that may otherwise be applicable with respect to any of the Transactions.
Section 2.3 Release
of Guarantees. In furtherance of, and not in limitation of, the obligations set forth in this Agreement.
(a) Each
of WPC and NLOP shall, at the request of the other Party and with the reasonable cooperation of such other Party and the applicable member(s) of
such Party’s Group, use commercially reasonable efforts to, as soon as reasonably practicable following the applicable Transactions,
(i) have any member(s) of the WPC Group removed as guarantor of, indemnitor of or obligor for any NLOP Liability, including
the termination and release of any Security Interest on or in any WPC Asset that may serve as collateral or security for any such NLOP
Liability; and (ii) have any member(s) of the NLOP Group removed as guarantor of, indemnitor of or obligor for any WPC Liability,
including the termination and release of any Security Interest on or in any NLOP Asset that may serve as collateral or security for any
such WPC Liability.
(b) If
and to the extent required:
(i) to
obtain a release of any member of the WPC Group from a guarantee or indemnity for any NLOP Liability, NLOP or one or more members of
the NLOP Group shall execute a guarantee or indemnity agreement in substantially the form of the existing guarantee or indemnity or such
other form as is reasonably agreed to by the relevant parties to such guarantee or indemnity agreement, which agreement shall include
the termination and release of any Security Interest on or in any WPC Asset that may serve as collateral or security for any such NLOP
Liability; provided, that, no such new guarantee or indemnity shall be required to the extent that the corresponding existing guarantee
or indemnity contains representations, covenants or other terms or provisions either (i) with which NLOP or the NLOP Group would
be reasonably unable to comply or (ii) which NLOP or the NLOP Group would not reasonably be able to avoid breaching;
(ii) to
obtain a release of any member of the NLOP Group from a guarantee or indemnity for any WPC Liability any member of the NLOP Group, WPC
or one or more members of the WPC Group shall execute a guarantee or indemnity agreement in substantially the form of the existing guarantee
or indemnity or such other form as is reasonably agreed to by the relevant parties to such guarantee or indemnity agreement, which agreement
shall include the termination and release of any Security Interest on or in any NLOP Asset that may serve as collateral or security for
any such WPC Liability; provided, that, no such new guarantee or indemnity shall be required to the extent that the corresponding existing
guarantee or indemnity contains representations, covenants or other terms or provisions either (i) with which WPC or the WPC Group
would be reasonably unable to comply or (ii) which WPC or the WPC Group would not reasonably be able to avoid breaching.
(c) Until
such time as WPC or NLOP has obtained, or has caused to be obtained, any removal or release as set forth in clauses (a) and (b) of
this Section 2.3, (i) the Party or the relevant member of its Group that has assumed the Liability related to such guarantee
shall indemnify, defend and hold harmless the guarantor or obligor against or from any Liability (in respect of a mortgage or otherwise)
arising from or relating thereto in accordance with the provisions of Article IX and shall, as agent or subcontractor for such guarantor,
indemnitor or obligor, pay, perform and discharge fully all the obligations or other Liabilities (in respect of mortgages or otherwise)
of such guarantor, indemnitor or obligor thereunder; and (ii) each of WPC and NLOP, on behalf of itself and the other members of
their respective Group, agree not to renew or extend the term of, increase any obligations under, decrease any rights under or transfer
to a third party, any loan, guarantee, lease, contract or other obligation for which the other Party or a member of its Group is or may
be liable unless all obligations of such other Party and the members of such other Party’s Group with respect thereto have theretofore
terminated by documentation satisfactory in form and substance to such other Party.
Section 2.4 Termination
of Intercompany Agreements.
(a) Except
as set forth in Section 2.4(b), WPC, on behalf of itself and each of the other members of the WPC Group, and NLOP, on behalf
of itself and each of the other members of the NLOP Group, hereby terminate, effective as of the Effective Time, any and all Intercompany
Agreements. No such terminated Intercompany Agreement will be of any further force or effect from and after the Effective Time and all
Parties shall be released from all Liabilities thereunder other than the Liability to settle any Intercompany Accounts as provided in
Section 2.4. Each Party shall take, or cause to be taken, any and all actions as may be reasonably necessary to effect the
foregoing.
(b) The
provisions of Section 2.4(a) shall not apply to any of the following agreements (which agreements shall continue to
be outstanding after the Distribution Date and thereafter shall be deemed to be, for each relevant Party (or the member of such Party’s
Group), an obligation to a third party and shall no longer be an Intercompany Agreement):
(i) this
Agreement and the Ancillary Agreements (and each other agreement or instrument expressly contemplated by this Agreement or any Ancillary
Agreement), if any;
(ii) any
confidentiality or non-disclosure agreements among any members of either Group or employees of the NLOP Advisors; and
(iii) any
agreement listed or described on Section 2.4(b) of the Disclosure Schedule.
Section 2.5 Settlement
of Intercompany Account. Each Intercompany Account outstanding immediately prior to the Distribution Date (other than those set forth
on Section 2.5 of the Disclosure Schedule), will be satisfied and/or settled in full in cash or otherwise cancelled and terminated
or extinguished by the relevant members of the WPC Group and the NLOP Group prior to the Effective Time, in each case, in the manner
agreed to by the Parties. Each Intercompany Account outstanding immediately prior to the Distribution Date set forth on Section 2.5
of the Disclosure Schedule, if any, shall continue to be outstanding after the Distribution Date (unless previously satisfied in
accordance with its terms) and thereafter shall be deemed to be, for each Party (or the relevant member of such Party’s Group),
an obligation to a third party and shall no longer be an Intercompany Account.
Section 2.6 Bank
Accounts.
(a) Each
Party agrees to use commercially reasonable efforts to take, or cause the members of its Group to take, at the Effective Time (or such
earlier time as the Parties may agree), all actions necessary to amend or substitute all contracts or agreements governing each bank
and brokerage account owned by NLOP (including any WPC bank or brokerage account that is part of the NLOP Business) or any other member
of the NLOP Group (collectively, the “NLOP Accounts”) and all contracts or agreements governing each bank or brokerage
account owned by WPC (including any WPC bank or brokerage account that is not part of the NLOP Business) or any other member of the WPC
Group (collectively, the “WPC Accounts”) so that each such NLOP Account and WPC Account, if currently linked (whether
by automatic withdrawal, automatic deposit or any other authorization to transfer funds from or to, hereinafter “Linked”)
to any WPC Account or NLOP Account, respectively, is de-Linked from such WPC Account or NLOP Account, respectively.
(b) With
respect to any outstanding checks issued or payments initiated by WPC, NLOP, or any of the members of their respective Groups prior to
the Effective Time, such outstanding checks and payments shall be honored following the Effective Time by the Person or Group owning
the account on which the check is drawn or from which the payment was initiated, respectively.
Section 2.7 Rent
Allocations. The Parties further agree that no later than 60 days following the Distribution Date, WPC shall be reimbursed an aggregate
of $366,395.83 for certain estimated rent payable with respect to the NLOP Assets that relates to uncollected rent for the period between
October 1, 2023 and the Effective Time, which shall be paid by wire transfer to an account designated by WPC in immediately
available funds.
Article III
CERTAIn
actions prior to the distributioN
Section 3.1 SEC
and Other Securities Filings.
(a) Prior
to the date of this Agreement, the Parties caused the Registration Statement to be declared effective by the SEC.
(b) Prior
to the date of this Agreement, WPC caused the Information Statement to be mailed to the Record Holders.
(c) The
Parties shall cooperate in preparing, filing with the SEC and causing to become effective any other registration statements or amendments
or supplements thereto that are necessary or appropriate in order to effect the Transactions, or to reflect the establishment of, or
amendments to, any employee benefit plans contemplated hereby.
(d) The
Parties shall take all such action as may be necessary or appropriate under state and foreign securities or “blue sky” Laws
in connection with the Transactions.
Section 3.2 NYSE
Listing Application.
(a) Prior
to the date of this Agreement, the Parties caused an application for the listing on the NYSE of NLOP Common Shares to be issued to the
Record Holders in the Distribution (the “NYSE Listing Application”) to be prepared and filed.
(b) The
Parties shall use commercially reasonable efforts to have the NYSE Listing Application approved, subject to official notice of issuance,
as soon as reasonably practicable following the date of this Agreement.
(c) WPC
shall give the NYSE notice of the Record Date in compliance with Rule 10b-17 under the Exchange Act.
Section 3.3 Distribution
Agent Agreement. On or prior to the date of this Agreement, WPC shall, if requested by the Distribution Agent, enter into a distribution
agent agreement with the Distribution Agent.
Section 3.4 NLOP
Advisory Agreements. On or prior to the Distribution Date, NLOP shall enter into the NLOP Advisory Agreements.
Section 3.5 Governmental
Approvals and Consents. To the extent that any of the Transactions require any Governmental Approval or Consent which has not been
obtained prior to the date of this Agreement, the Parties will use commercially reasonable efforts to obtain, or cause to be obtained,
such Governmental Approval or Consent prior to the Effective Time.
Section 3.6 Ancillary
Agreements. Prior to the Effective Time, each Party shall execute and deliver, and shall cause each applicable member of its Group
to execute and deliver, as applicable, the NLOP Advisory Agreements and the Tax Matters Agreement, as well as such other written agreements,
documents or instruments as the Parties may agree are reasonably necessary or desirable and to the effect the Transactions (collectively,
the “Ancillary Agreements”).
Section 3.7 Governance
Matters.
(a) Organizational
Documents. On or prior to the Distribution Date, the Parties shall take all necessary actions to adopt each of the amended and restated
declaration of trust of NLOP, the amended and restated bylaws of NLOP and the amended and restated operating agreement of NLOP LLC, each
substantially in the forms filed by NLOP with the SEC as exhibits to the Registration Statement.
(b) Officers
and Trustees. On or prior to the Distribution Date, the Parties shall take all necessary action so that, as of the Distribution Date,
the officers and trustees of NLOP will be as set forth in the Information Statement.
Article IV
THE
DISTRIBUTION
Section 4.1 Dividend
to WPC. On or prior to the Distribution Date, NLOP shall issue to WPC as a stock dividend such number of NLOP Common Shares (or WPC
and NLOP shall take or cause to be taken such other appropriate actions to ensure that WPC has the requisite number of NLOP Common Shares)
as may be required to effect the Distribution.
Section 4.2 Delivery
to Distribution Agent. Subject to Section 5.1, on or prior to the Distribution Date, WPC will authorize the Distribution
Agent, for the benefit of holders of record of WPC Common Stock at the close of business on the Record Date (the “Record Holders”),
to effect the book-entry transfer of all outstanding NLOP Common Shares and will instruct the Distribution Agent to effect the Distribution
at the Effective Time in the manner set forth in Section 4.3.
Section 4.3 Mechanics
of the Distribution.
(a) On
the Distribution Date, WPC will direct the Distribution Agent to distribute, effective as of the Effective Time, to each Record Holder,
one (1) NLOP Common Share for every fifteen (15) shares of WPC Common Stock held by such Record Holder on the Record Date (the “Distribution
Ratio”), subject to Section 4.3(b). All such NLOP Common Shares to be so distributed shall be distributed as uncertificated
shares registered in book-entry form through the direct registration system. No certificates therefor shall be distributed. All of the
NLOP Common Shares distributed in the Distribution will be validly issued, fully paid and non-assessable.
(b) Record
Holders who, after aggregating the number of NLOP Common Shares (or fractions thereof) to which such Record Holder would be entitled
on the Record Date, would be entitled to receive a fraction of a NLOP Common Share in the Distribution, will receive cash in lieu of
fractional shares. Fractional NLOP Common Shares will not be distributed in the Distribution nor credited to book-entry accounts. The
Distribution Agent shall, as soon as practicable after the Distribution Date (i) determine the number of whole shares and fractional
shares of NLOP Common Shares allocable to each Record Holder, (ii) aggregate all such fractional shares into whole shares and sell
the whole shares obtained thereby in open market transactions at then prevailing trading prices on behalf of the Record Holders who would
otherwise be entitled to fractional share interests, and (iii) distribute to each such Record Holder such holder’s ratable
share of the net proceeds of such sale, based upon the average gross selling price per share of NLOP Common Shares after making appropriate
deductions for any amount required to be withheld for United States federal income tax purposes. NLOP shall bear the cost of brokerage
fees and transfer taxes incurred in connection with these sales of fractional shares, which such sales shall occur as soon after the
Distribution Date as practicable and as determined by the Distribution Agent. None of WPC, NLOP or the applicable Distribution Agent
will guarantee any minimum sale price for the fractional NLOP Common Shares. Neither WPC nor NLOP will pay any interest on the proceeds
from the sale of fractional shares. The Distribution Agent will have the sole discretion to select the broker-dealers through which to
sell the aggregated fractional shares and to determine when, how and at what price to sell such shares. Neither the Distribution Agent
nor the selected broker-dealers will be Affiliates of WPC or NLOP. Any NLOP Common Shares or cash in lieu of fractional shares
with respect to NLOP Common Shares that remain unclaimed by any Record Holder after the Distribution Date
shall be the responsibility of NLOP, and any such Record Holder shall look only to NLOP, not WPC, for such NLOP Common Shares and/or
cash, if any, in lieu of fractional share interests, subject in each case to applicable escheat or other abandoned property laws.
(c) Notwithstanding
any other provision of this Agreement, WPC, the Distribution Agent or any Person that is a withholding agent under applicable Law shall
be entitled to deduct and withhold from any consideration distributable or payable hereunder the amounts required to be deducted and
withheld under the Code, or any provision of any U.S. federal, state, local or foreign Tax Law. Any amounts so withheld shall be paid
over to the appropriate Tax Authority in the manner prescribed by Law. To the extent that amounts are so deducted and withheld, such
deducted and withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Persons in respect of which
such deduction and withholding was made. An applicable withholding agent may collect the deducted or withheld amounts by reducing to
cash a sufficient portion of the NLOP Common Shares that a Person would otherwise receive, and may require that such Person bear the
brokerage or other costs from this withholding procedure.
Article V
CONDITIONS
Section 5.1 Conditions
Precedent to Consummation of the Distribution. The Distribution shall not be effected unless and until the following conditions have
been satisfied or waived by WPC, in its sole and absolute discretion, at or before the Effective Time:
(a) the
Separation shall have occurred;
(b) the
NLOP Financing Arrangements shall have been executed and the conditions for borrowing thereunder satisfied, and $382.4 million from the
borrowings under the NLOP Financing Arrangements shall have been transferred to WPC, in each case in accordance with Section 2.1
of the Disclosure Schedule;
(c) the
board of directors of WPC shall have declared the Distribution, which declaration may be made or withheld at its sole and absolute discretion;
(d) the
Registration Statement shall have been declared effective by the SEC, with no stop order in effect with respect thereto, and no proceedings
for such purpose shall be pending before, or threatened by, the SEC;
(e) WPC
shall have mailed the Information Statement (and such other information concerning NLOP, the Distribution and such other matters as the
Parties shall determine and as may otherwise be required by Law) to the Record Holders;
(f) all
other actions and filings necessary or appropriate under applicable federal or state securities Laws and state blue sky Laws in connection
with the Transactions shall have been taken;
(g) WPC
shall not be required to register as an investment company under the Investment Company Act;
(h) NLOP
shall not be required to register as an investment company under the Investment Company Act;
(i) the
NYSE shall have approved the NYSE Listing Application, subject to official notice of issuance;
(j) the
Ancillary Agreements, including the NLOP Advisory Agreements and the Tax Maters Agreement, shall have been executed and delivered by
each of the parties thereto and no party to any of the Ancillary Agreements will be in material breach of any such agreement;
(k) any
material Governmental Approvals and Consents necessary to consummate the Transactions or any portion thereof shall have been obtained
and be in full force and effect;
(l) no
preliminary or permanent injunction or other order, decree, or ruling issued by a Governmental Authority, and no Law shall be in effect
preventing the consummation of, or materially limiting the benefits of, the Transactions; and
(m) no
other event or development shall have occurred or failed to occur that, in the judgment of the board of directors of WPC, exercised in
its sole discretion, prevents the consummation of the Transactions or any portion thereof or makes the consummation of the Transactions
inadvisable.
Section 5.2 Right
Not to Close. Each of the conditions set forth in Section 5.1 is for the benefit of WPC, and the board of directors of
WPC may, in its sole and absolute discretion, determine whether to waive any condition, in whole or in part. Any determination made by
the board of directors of WPC concerning the satisfaction or waiver of any or all of the conditions in Section 5.1 will be
conclusive and binding on the Parties. The satisfaction of the conditions set forth in Section 5.1 will not create any obligation
on the part of WPC to any other Person to effect any of the Transactions or in any way limit WPC’s right to terminate this Agreement
and the Ancillary Agreements as set forth in Section 11.1 or alter the consequences of any termination from those specified
in Section 11.2.
Article VI
NO
REPRESENTATIONS OR WARRANTIES
Section 6.1 Disclaimer
of Representations and Warranties. EACH PARTY (ON BEHALF OF ITSELF AND EACH OTHER MEMBER OF ITS GROUP) UNDERSTANDS AND AGREES THAT,
EXCEPT AS EXPRESSLY SET FORTH HEREIN, IN ANY ANCILLARY AGREEMENT OR IN ANY OTHER AGREEMENT OR DOCUMENT CONTEMPLATED BY THIS AGREEMENT
OR ANY ANCILLARY AGREEMENT, NO PARTY IS REPRESENTING OR WARRANTING IN ANY WAY AS TO (A) THE ASSETS, BUSINESSES OR LIABILITIES CONTRIBUTED,
TRANSFERRED, DISTRIBUTED OR ASSUMED AS CONTEMPLATED HEREBY OR THEREBY, (B) ANY CONSENTS OR GOVERNMENTAL APPROVALS REQUIRED IN CONNECTION
HEREWITH OR THEREWITH, (C) THE VALUE OR FREEDOM FROM ANY SECURITY INTERESTS OF, OR ANY OTHER MATTER CONCERNING, ANY ASSETS OF ANY
PARTY, (D) THE ABSENCE OF ANY DEFENSES OR RIGHT OF SETOFF OR FREEDOM FROM COUNTERCLAIM WITH RESPECT TO ANY ACTION OR OTHER ASSET, INCLUDING
ACCOUNTS RECEIVABLE, OF ANY PARTY, OR (E) THE LEGAL SUFFICIENCY OF ANY CONTRIBUTION, DISTRIBUTION, ASSIGNMENT, DOCUMENT, CERTIFICATE
OR INSTRUMENT DELIVERED HEREUNDER OR THEREUNDER TO CONVEY TITLE TO ANY ASSET UPON THE EXECUTION, DELIVERY AND FILING HEREOF OR THEREOF.
Section 6.2 As
Is, Where Is. EACH PARTY (ON BEHALF OF ITSELF AND EACH OTHER MEMBER OF ITS GROUP) UNDERSTANDS AND AGREES THAT ALL ASSETS TRANSFERRED
PURSUANT TO THIS AGREEMENT OR ANY ANCILLARY AGREEMENT ARE BEING TRANSFERRED “AS IS, WHERE IS.”
Article VII
CERTAIN
COVENANTS AND ADDITIONAL AGREEMENTS
Section 7.1 Insurance
Matters.
(a) Prior
to the Distribution Date, WPC and NLOP shall use commercially reasonable efforts to obtain separate Insurance Policies for NLOP related
to all applicable currently existing WPC Insurance Policies on commercially reasonable terms (it being understood that NLOP shall be
responsible for all premiums, costs and fees associated with any new insurance policies placed for the benefit of NLOP pursuant to this
Section 7.1).
(b) From
and after the Effective Time, (i) WPC shall be entitled to terminate, or cause to be terminated, coverage under existing insurance
policies with respect to the NLOP Assets, NLOP Liabilities, WPC Assets, and WPC Liabilities, (ii) WPC shall be entitled to cause
the WPC Assets and WPC Liabilities to be covered by existing or new insurance policies of the WPC Group, and (iii) NLOP shall cause
the NLOP Assets and the NLOP Liabilities to be covered by existing or new insurance policies of the NLOP Group.
(c) This
Agreement shall not be considered as an attempted assignment of any policy of insurance or as a contract of insurance and shall not be
construed to waive any right or remedy of any member of either Group in respect of any insurance policy or any other contract or policy
of insurance.
(d) From
and after the Effective Time, with respect to any losses, damages and Liability incurred by any member of the NLOP Group or the WPC Group,
as the case may be (the “Loss Party”), arising from events or occurrences prior to the date on which the Effective
Time occurs (“Insurance Termination Date”), WPC or NLOP, respectively (the “Insured Party”),
will provide the Loss Party with access to, and the Loss Party may, upon ten (10) days’ prior written notice to the Insured
Party, make claims under the Insured Party’s third-party insurance policies in place prior to the Insurance Termination Date and
the Insured Party’s historical policies of insurance, but solely to the extent that such policies provided coverage for members
of the Loss Party’s Group prior to the Insurance Termination Date; provided that such access to, and the right to make claims under,
such insurance policies, shall be subject to the terms and conditions of such insurance policies, including any limits on coverage or
scope, any deductibles and other fees and expenses, and shall be subject to the following additional conditions:
(i) the
Loss Party shall report any claim to the Insured Party as promptly as practicable, and in any event in sufficient time so that such claim
may be made in accordance with the Insured Party’s claim reporting procedures provided in advance to the Loss Party and in effect
immediately prior to the Insurance Termination Date (or in accordance with any modifications to such procedures after the Insurance Termination
Date communicated by the Insured Party to the Loss Party in writing in advance of any such claim);
(ii) the
Loss Party and the members of its Group shall exclusively bear and be liable for (and neither the Insured Party, nor any member of its
Group, shall have any obligation to repay or reimburse Loss Party or any member of its Group for), and shall indemnify, hold harmless
and reimburse the Insured Party and the members of its Group for, any deductibles, self-insured retention, fees and expenses incurred
by the Insured Party or any members of its Group to the extent resulting from any access by the Loss Party or any other members of its
Group to, or any claims made by the Loss Party or any other members of its Group under, any insurance provided pursuant to this Section 7.1(d),
including any indemnity payments, settlements, judgments, legal fees and allocated claims expenses and claim handling fees, whether such
claims are made by members of the Loss Party’s Group, its employees or third parties; and
(iii) any
payments and reimbursements by the Loss Party pursuant to this Section 7.1(d) will be made within thirty (30) days after the
Loss Party’s receipt of an invoice therefor from the Insured Party. If the Insured Party incurs costs to enforce the Loss Party’s
obligations herein, the Loss Party agrees to indemnify and hold harmless the Insured Party for such enforcement costs, including reasonable
attorneys’ fees. The Insured Party shall retain the exclusive right to control its insurance policies and programs, including the
right to exhaust, settle, release, commute, buy-back or otherwise resolve disputes with respect to any of its insurance policies and
programs and to amend, modify or waive any rights under any such insurance policies and programs, notwithstanding whether any such policies
or programs apply to any Loss Party Liabilities and/or claims the Loss Party has made or could make in the future, and no member of the
Loss Party’s Group shall erode, exhaust, settle, release, commute, buyback or otherwise resolve disputes with the Insured Party’s
insurers with respect to any of the Insured Party’s insurance policies and programs, or amend, modify or waive any rights under
any such insurance policies and programs. The Loss Party shall cooperate with the Insured Party and share such information as is reasonably
necessary in order to permit the Insured Party to manage and conduct its insurance matters as it deems appropriate. Neither the Insured
Party nor any of the members of the Insured Party’s Group shall have any obligation to secure extended reporting for any claims
under any Liability policies of the Insured Party or any member of the Insured Party’s Group for any acts or omissions by any member
of the Loss Party’s Group incurred prior to the Insurance Termination Date.
Section 7.2 No
Restrictions on Post-Closing Competitive Activities; Corporate Opportunities.
(a) Each
of the Parties agrees that this Agreement shall not include any non-competition or other similar restrictive arrangements with respect
to the range of business activities that may be conducted, or investments that may be made, by the Groups. Accordingly, each of the Parties
acknowledges and agrees that nothing set forth in this Agreement shall be construed to create any explicit or implied restriction or
other limitation on the ability of any Group to engage in any business or other activity that overlaps or competes with the business
of the other Group. Except as expressly provided herein, in WPC’s or NLOP’s conflicts of interest policies, or in the Ancillary
Agreements, (x) each Group shall have the right to, and shall have no duty to abstain from exercising such right to, (i) engage
or invest, directly or indirectly, in the same, similar or related business activities or lines of business as the other Group, (ii) make
investments in the same or similar types of investments as the other Group, (iii) do business with any client, customer, vendor
or lessor of any of the other Group or (iv) employ or otherwise engage any officer, trustee, director or employee of the other Group,
and (y) neither Party or Group, nor any officer, trustee or director thereof, shall be liable to the other Party or Group or its
stockholders for breach of any fiduciary duty by reason of any such activities of such Party or Group or of any such Person’s participation
therein.
(b) Except
as expressly provided herein, in WPC’s or NLOP’s conflicts of interest policies, or in the Ancillary Agreements, and except
as WPC and each other member of the WPC Group, on the one hand, and NLOP and each other member of the NLOP Group, on the other hand,
may otherwise agree in writing, the Parties hereby acknowledge and agree that if any Person that is a member of a Group, including any
officer, trustee or director thereof, acquires knowledge of a potential transaction or matter that may be a corporate opportunity for
either or both Groups, neither the other Group nor its stockholders shall have an interest in, or expectation that, such corporate opportunity
be offered to it or that it be offered an opportunity to participate therein, and any such interest, expectation, offer or opportunity
to participate, and any other interest or expectation otherwise due to such Group with respect to such corporate opportunity, is hereby
renounced by such Group on its behalf and on behalf of its stockholders. Accordingly, subject to Section 7.2(c) and
except as expressly provided herein, in WPC’s or NLOP’s conflicts of interest policies, or in the Ancillary Agreements, (i) neither
Group nor any officer, trustee or director thereof will be under any obligation to present, communicate or offer any such corporate opportunity
to the other Group and (ii) each Group has the right to hold any such corporate opportunity for their own account, or to direct,
recommend, sell, assign or otherwise transfer such corporate opportunity to any Person or Persons other than the other Group, and, to
the fullest extent permitted by Law, neither Group nor the officers, trustees or directors thereof shall have or be under any fiduciary
duty, duty of loyalty or duty to act in good faith or in the best interests of the other Group and its stockholders and shall not be
liable to the other Group and its stockholders for any breach or alleged breach thereof or for any derivation of personal economic gain
by reason of the fact that such Group or any of its officers, trustees or directors pursues or acquires the corporate opportunity for
itself, or directs, recommends, sells, assigns or otherwise transfers the corporate opportunity to another Person, or such Group and
its officers, trustees or directors does not present, offer or communicate information regarding the corporate opportunity to the other
Group.
(c) Except
as expressly provided herein, in the Ancillary Agreements, or in WPC or NLOP’s conflicts of interest policies, and except as WPC
and each other member of the WPC Group, on the one hand, and NLOP and each other member of the NLOP Group, on the other hand, may otherwise
agree in writing, the Parties hereby acknowledge and agree that in the event that a trustee, director or officer of either Group who
is also a trustee, director or officer of the other Group acquires knowledge of a potential transaction or matter that may be a corporate
opportunity or is offered a corporate opportunity, if (i) such Person acts in good faith and (ii) such knowledge of such potential
transaction or matter was not obtained solely in connection with, or such corporate opportunity was not offered to such Person solely
in, such Person’s capacity as trustee, director or officer of either Group, then (A) such trustee, director or officer, to
the fullest extent permitted by Law, (1) shall be deemed to have fully satisfied and fulfilled such Person’s fiduciary duty
to each Group and their stockholders with respect to such corporate opportunity, (2) shall not have or be under any fiduciary duty
to either Group or their stockholders and shall not be liable to either Group or their stockholders for any breach or alleged breach
thereof by reason of the fact that the other Group pursues or acquires the corporate opportunity for itself, or directs, recommends,
sells, assigns or otherwise transfers the corporate opportunity to another Person, or either Group or such trustee, director or officer
does not present, offer or communicate information regarding the corporate opportunity to the other Group, (3) shall be deemed to
have acted in good faith and in a manner such Person reasonably believes to be in, and not opposed to, the best interests of each Group
and its stockholders and (4) shall not have any duty of loyalty to the other Group and its stockholders or any duty not to derive
any personal benefit therefrom and shall not be liable to the other Group or its stockholders for any breach or alleged breach thereof
and (B) such potential transaction or matter that may be a corporate opportunity, or the corporate opportunity, shall belong to
the applicable Group (and not to the other Group).
(d) Except
as expressly provided herein, in WPC’s or NLOP’s conflicts of interest policies, or in the Ancillary Agreements, if the NLOP
Advisors acquire knowledge of a potential transaction or matter that may be a corporate opportunity for either or both Groups, neither
the NLOP Advisors, nor any agent or advisor thereof, shall have any duty to communicate or present such corporate opportunity to either
Group and shall not be liable to either Group or to their stockholders for breach of any fiduciary duty by reason of the fact that the
NLOP Advisors pursue or acquire the corporate opportunity for itself, or directs, recommends, sells, assigns or otherwise transfers the
corporate opportunity to either Group or another Person, or does not present such corporate opportunity to either Group.
(e) For
the purposes of this Section 7.2, “corporate opportunities” of a Group shall include business opportunities that
such Group is financially able to undertake, that are, by their nature, in a line of business of such Group, are of practical advantage
to it and are ones in which any member of the Group has an interest or a reasonable expectancy, and in which, by embracing the opportunities,
the self-interest of a Person or any of its officers, trustees or directors will be brought into conflict with that of such Group.
Section 7.3 Cooperation.
Each of the Parties shall establish an appropriate administration system in order to handle in an orderly manner the vesting of any restricted
NLOP Common Shares received in the Distribution that relate to shares of restricted WPC Common Stock. The Parties shall work together
to unify and consolidate all indicative data and payroll and employment information on regular timetables and make certain that each
applicable entity’s data and records in respect of such awards are correct and updated on a timely basis. The foregoing shall include,
as applicable, employment status and information required for tax withholding/remittance and reporting, compliance with trading windows
and compliance with the requirements of the Exchange Act and other applicable laws.
Article VIII
ACCESS
TO INFORMATION; CONFIDENTIALITY; PRIVILEGE
Section 8.1 Agreement
for Exchange of Information.
(a) For
a period (the “Period”) of three (3) years following the Distribution Date or until the termination of both of
the NLOP Advisory Agreements, whichever is longer, as soon as reasonably practicable after written request: (i) WPC shall afford
to any member of the NLOP Group and their authorized accountants, counsel and other designated representatives reasonable access during
normal business hours to, or, at the NLOP Group’s expense, provide copies of, all books, records, Contracts, instruments, data,
documents and other information in the possession or under the control of any member of the WPC Group immediately following the Distribution
Date that relates to any member of the NLOP Group or the NLOP Assets and (ii) NLOP shall afford to any member of the WPC Group and
their authorized accountants, counsel and other designated representatives reasonable access during normal business hours to, or, at
the WPC Group’s expense, provide copies of, all books, records, Contracts, instruments, data, documents and other information in
the possession or under the control of any member of the NLOP Group immediately following the Distribution Date that relates to any member
of the WPC Group or the WPC Assets; provided, however, that in the event that NLOP or WPC, as applicable, determine that
any such provision of or access to any information in response to a request under this Section 8.1(a) would be commercially
detrimental in any material respect, violate any Law or agreement or waive any attorney-client privilege, the work product doctrine or
other applicable privilege, the Parties shall take all reasonable measures to permit compliance with such request in a manner that avoids
any such harm or consequence; provided, further, that to the extent specific information-sharing or knowledge-sharing provisions
are contained in any of the Ancillary Agreements, such other provisions (and not this Section 8.1(a)) shall govern; provided,
further, that the Period shall be extended with respect to requests related to any third party litigation or other dispute filed
prior to the end of such period until such litigation or dispute is finally resolved.
(b) Without
limiting the generality of Section 8.1(a), until the end of the first full fiscal year following the Distribution Date (and
for a reasonable period of time thereafter as required for any party to prepare consolidated financial statements or complete a financial
statement audit for the fiscal year during which the Distribution Date occurs), NLOP shall use its commercially reasonable efforts to
cooperate with any requests from any member of the WPC Group pursuant to Section 8.1(a) and WPC shall use its commercially
reasonable efforts to cooperate with any requests from any member of the NLOP Group pursuant to Section 8.1(a), in each case
to enable the requesting Party to meet its timetable for dissemination of its earnings releases and financial statements and to enable
such requesting party’s auditors to timely complete their audit of the annual financial statements and review of the quarterly
financial statements.
Section 8.2 Ownership
of Information. Any information owned by any Person as of the Effective Time that is provided pursuant to Section 8.1(a) shall
be deemed to remain the property of the providing Person. Unless specifically set forth herein, nothing contained in this Agreement shall
be construed to grant or confer rights of license or otherwise to the requesting Person with respect to any such information.
Section 8.3 Compensation
for Providing Information. A Person requesting information pursuant to Section 8.1(a) agrees to reimburse the providing
Person for the actual expenses, if any, of gathering and copying such information, to the extent that such expenses are incurred for
the benefit of the requesting Person.
Section 8.4 Retention
of Records. To facilitate the exchange of information pursuant to this Article VIII after the Distribution Date, for
the duration of the Period, except as otherwise required or agreed in writing, the Parties agree to use commercially reasonable efforts
to retain, or cause to be retained, all information in their, or any member of their Group’s, respective possession or control
on the Distribution Date in accordance with the records retention policies and procedures of WPC as in effect on the Distribution Date
or modified in good faith thereafter.
Section 8.5 Limitation
of Liability. No Person required to provide information under this Article VIII shall have any Liability (a) if
any historical information provided pursuant to this Article VIII is found to be inaccurate or incomplete, in the absence
of gross negligence or willful misconduct by such Person, or (b) if any information is lost or destroyed despite using commercially
reasonable efforts to comply with the provisions of Section 8.4.
Section 8.6 Production
of Witnesses. At all times from and after the Distribution Date, upon reasonable advance request:
(a) NLOP
shall use commercially reasonable efforts to make available, or cause to be made available, to any member of the WPC Group, the trustees,
the directors, officers, employees and agents of any member of the NLOP Group as witnesses to the extent that the same may reasonably
be required by the requesting party (giving consideration to business demands of such trustees, directors, officers, employees and agents)
in connection with any legal, administrative or other proceeding in which the requesting party may from time to time be involved, except
in the case of any action, suit or proceeding in which any member of the NLOP Group is adverse to any member of the WPC Group; and
(b) WPC
shall use commercially reasonable efforts to make available, or cause to be made available, to any member of the NLOP Group, the trustees,
the directors, officers, employees and agents of any member of the WPC Group as witnesses to the extent that the same may reasonably
be required by the requesting party (giving consideration to business demands of such trustees, directors, officers, employees and agents)
in connection with any legal, administrative or other proceeding in which the requesting party may from time to time be involved, except
in the case of any action, suit or proceeding in which any member of the WPC Group is adverse to any member of the NLOP Group.
Section 8.7 Confidentiality.
(a) NLOP
(on behalf of itself and each other member of its Group) and WPC (on behalf of itself and each other member of its Group) shall hold,
and shall cause each of their respective Affiliates to hold, and each of the foregoing shall cause their respective trustees, directors,
officers, employees, agents, consultants and advisors to hold, in strict confidence, and not to disclose or release or use, for any purpose
other than as expressly permitted pursuant to this Agreement or the Ancillary Agreements, any and all Confidential Information concerning
any member of the other Group without the prior written consent of such member of the other Group; provided, that each Party and
the members of its Group may disclose, or may permit disclosure of, such Confidential Information (i) to other members of their
Group and their respective auditors, attorneys, financial advisors, bankers and other appropriate consultants and advisors (including
the NLOP Advisors, as applicable) who have a need to know such information for purposes of performing services for a member of such Group
and who are informed of their obligation to hold such information confidential to the same extent as is applicable to the Parties and
in respect of whose failure to comply with such obligations, such Party will be responsible, (ii) if it or any of its Affiliates
are required or compelled to disclose any such Confidential Information by judicial or administrative process or by other requirements
of Law or stock exchange rule, or (iii) as necessary in order to permit such Party to prepare and disclose its financial statements,
or other disclosures required by Law or such applicable stock exchange. Notwithstanding the foregoing, in the event that any demand or
request for disclosure of Confidential Information is made pursuant to the foregoing clause (ii) above, the Party requested to disclose
Confidential Information concerning a member of the other Group, shall, to the extent legally permissible, promptly notify such member
of the other Group of the existence of such request or demand and, to the extent commercially practicable and legally permissible, shall
provide such member of the other Group thirty (30) days (or such lesser period as is commercially practicable and legally permissible)
to seek an appropriate protective order or other remedy, which the Parties will cooperate in obtaining at the sole cost of the Party
seeking such protective order or remedy. In the event that such appropriate protective order or other remedy is not obtained, the Party
that is required to disclose Confidential Information about a member of the Group shall furnish, or cause to be furnished, only that
portion of the Confidential Information that is legally required to be disclosed and shall use commercially reasonable efforts to ensure
that confidential treatment is accorded such information.
(b) Notwithstanding
anything to the contrary set forth herein, the Parties shall be deemed to have satisfied their obligations hereunder with respect to
Confidential Information of any member of the other Group if they exercise the same degree of care (but no less than a reasonable degree
of care) as they exercise to preserve confidentiality for their own similar Confidential Information.
(c) Upon
the written request of a Party or a member of its Group, the other Party shall take, and shall cause the applicable members of its Group
to take, reasonable steps to promptly (i) deliver to the requesting Person all original copies of Confidential Information (whether
written or electronic) concerning the requesting Person or any member of its Group that is in the possession of the other Party or any
member of its Group and (ii) if specifically requested by the requesting Person, destroy (as to electronic Confidential Information,
to the extent practical) any copies of such Confidential Information (including any extracts therefrom), unless such delivery or destruction
would violate any Law; provided, that the other Party shall not be obligated to destroy Confidential Information that is required
by or relates to the business of the other Party or any member of its Group and shall be permitted to retain copies of Confidential Information
to the extent necessary to comply with legal, regulatory, audit or document retention policies. Upon the written request of the requesting
Person, the other Party shall, or shall cause another member of its Group to cause, its duly authorized officers to certify in writing
to the requesting party that the requirements of the preceding sentence have been satisfied in full.
Section 8.8 Privileged
Matters.
(a) Pre-Distribution
Services. The Parties recognize that legal and other professional services that have been and will be provided prior to the Effective
Time have been and will be rendered for the collective benefit of the Parties and their Affiliates, and that each of the Parties should
be deemed to be the client with respect to such pre-Distribution services for the purposes of asserting all privileges that may be asserted
under applicable Law.
(b) Post-Distribution
Services. The Parties recognize that legal and other professional services will be provided following the Effective Time that will
be rendered solely for the benefit of NLOP and its Affiliates or WPC and its Affiliates, as the case may be. With respect to such post-Distribution
services, the Parties agree as follows:
(i) WPC
shall be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged information that
relates solely to the WPC Assets, whether or not the privileged information is in the possession of or under the control of WPC or NLOP.
WPC shall also be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged information
that relates solely to the subject matter of any claims constituting WPC Liabilities, now pending or which may be asserted in the future,
in any lawsuits or other proceedings initiated by or against any member of the WPC Group, whether or not the privileged information is
in the possession of or under the control of WPC or NLOP; and
(ii) NLOP
shall be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged information that
relates solely to the NLOP Assets, whether or not the privileged information is in the possession of or under the control of WPC or NLOP.
NLOP shall also be entitled, in perpetuity, to control the assertion or waiver of all privileges in connection with privileged information
that relates solely to the subject matter of any claims constituting NLOP Liabilities, now pending or which may be asserted in the future,
in any lawsuits or other proceedings initiated by or against any member of the NLOP Group, whether or not the privileged information
is in the possession of or under the control of WPC or NLOP.
(c) The
Parties agree that they shall have a shared privilege, with equal right to assert or waive, subject to the restrictions in this Section 8.8,
with respect to all privileges not allocated pursuant to the terms of Section 8.8(b). NLOP may not waive, and shall cause
each other member of the NLOP Group not to waive, any privilege that could be asserted by a member of the WPC Group under any applicable
Law, and in which a member of the WPC Group has a shared privilege, without the consent of WPC, which consent shall not be unreasonably
withheld, conditioned or delayed or as provided in Section 8.8(d) or Section 8.8(e) below. WPC may
not waive, and shall cause each other member of the WPC Group not to waive, any privilege that could be asserted by a member of the NLOP
Group under any applicable Law, and in which a member of the NLOP Group has a shared privilege, without the consent of NLOP, which consent
shall not be unreasonably withheld, conditioned or delayed or as provided in Section 8.8(d) or Section 8.8(e) below.
(d) In
the event of any litigation or dispute between or among NLOP and WPC, or any members of their respective Groups, the Parties may waive
a privilege in which a member of the other Group has a shared privilege, without obtaining the consent from any other party; provided,
that such waiver of a shared privilege shall be effective only as to the use of information with respect to the litigation or dispute
between the relevant Parties and/or the applicable members of their respective Groups, and shall not operate as a waiver of the shared
privilege with respect to third parties.
(e) If
a dispute arises between or among NLOP and WPC, or any members of their respective Groups, regarding whether a privilege should be waived
to protect or advance the interest of a party, each Party agrees that it shall negotiate in good faith, shall endeavor to minimize any
prejudice to the rights of such party and shall not withhold consent to any request for waiver by such party except to protect its own
legitimate interests or the legitimate interests of any other member of its Group.
(f) Upon
receipt by either Party, or by any member of its Group, of any subpoena, discovery or other request which requires the production or
disclosure of information which such Party knows is subject to a shared privilege or as to which a member of the other Group has the
sole right hereunder to assert or waive a privilege, or if either Party obtains knowledge that any of its or any other member of its
Group’s current or former trustees, directors, officers, agents or employees have received any subpoena, discovery or other requests
which requires the production or disclosure of such privileged information, such Party shall, to the extent legally permissible, promptly
notify the other Party of the existence of the request and shall provide the other Party a reasonable opportunity to review the information
and to assert any rights it or they may have under this Section 8.8 or otherwise to prevent the production or disclosure
of such privileged information.
(g) The
access to information being granted pursuant to Section 8.1, the agreement to provide witnesses and individuals pursuant
to Section 8.6 hereof, and the transfer of privileged information between and among the Parties and the members of their
respective Groups pursuant to this Agreement shall not be deemed a waiver of any privilege that has been or may be asserted under this
Agreement, any of the Ancillary Agreements or otherwise.
Section 8.9 Financial
Information Certifications. The Parties agree to reasonably cooperate with each other in such manner as is necessary to enable the
principal executive officer or officers, principal financial officer or officers and controller or controllers of each of the Parties
to make the certifications required of them under Sections 302, 404 and 906 of the Sarbanes-Oxley Act of 2002.
Article IX
MUTUAL
RELEASES; INDEMNIFICATION
Section 9.1 Release
of Pre-Distribution Claims.
(a) Except
as provided in Section 9.1(c), effective as of the Effective Time, NLOP does hereby, for itself and each other member of
the NLOP Group, release and forever discharge each WPC Indemnitee, from any and all Liabilities whatsoever to any member of the NLOP
Group, whether at law or in equity (including any right of contribution), whether arising under any Contract, by operation of Law or
otherwise, existing or arising from any acts or events occurring or failing to occur or alleged to have occurred or to have failed to
occur or any conditions existing or alleged to have existed at or before the Effective Time, including in connection with the Transactions.
(b) Except
as provided in Section 9.1(c), effective as of the Effective Time, WPC does hereby, for itself and each other member of the
WPC Group, release and forever discharge each NLOP Indemnitee from any and all Liabilities whatsoever to any member of the WPC Group,
whether at law or in equity (including any right of contribution), whether arising under any Contract, by operation of Law or otherwise,
existing or arising from any acts or events occurring or failing to occur or alleged to have occurred or to have failed to occur or any
conditions existing or alleged to have existed at or before the Effective Time, including in connection with the Transactions.
(c) Nothing
contained in Section 9.1(a) or Section 9.1(b) shall impair any right of any Person to enforce this
Agreement, any Ancillary Agreement or any agreements, arrangements, commitments or understandings that are specified in, or contemplated
to continue pursuant to, this Agreement or any Ancillary Agreement. Without limiting the foregoing, nothing contained in Section 9.1(a) or
Section 9.1(b) shall release any Person from:
(i) any
Liability, contingent or otherwise, assumed by, or allocated to, such Person in accordance with this Agreement or any Ancillary Agreement;
(ii) any
Liability that such Person may have with respect to indemnification or contribution pursuant to this Agreement or any Ancillary Agreement
for claims brought by third Persons, which Liability shall be governed by the provisions of this Article IX and, if applicable,
the appropriate provisions of the Ancillary Agreements;
(iii) any
unpaid accounts payable or receivable arising from or relating to the sale, provision, or receipt of goods, payment for goods, property
or services purchased, obtained or used in the ordinary course of business by any member of the WPC Group from any member of the NLOP
Group, or by any member of the NLOP Group from any member of the WPC Group from and after the Effective Time; or
(iv) any
Liability the release of which would result in the release of any Person other than an Indemnitee; provided, that the Parties agree not
to bring suit, or permit any other member of their respective Group to bring suit, against any Indemnitee with respect to such Liability.
(d) NLOP
shall not make, and shall not permit any other member of the NLOP Group to make, any claim or demand, or commence any Action asserting
any claim or demand, including any claim of contribution or indemnification, against any WPC Indemnitee with respect to any Liabilities
released pursuant to Section 9.1(a). WPC shall not make, and shall not permit any member of the WPC Group to make, any claim
or demand, or commence any Action asserting any claim or demand, including any claim of contribution or any indemnification, against
any NLOP Indemnitee with respect to any Liabilities released pursuant to Section 9.1(b).
Section 9.2 Indemnification
by NLOP. Except as provided in Section 9.4 and Section 9.5, NLOP shall, and, in the case of Section 9.2(a) or
Section 9.2(b), shall in addition cause each Appropriate Member of the NLOP Group to, indemnify, defend and hold harmless
the WPC Indemnitees from and against any and all Losses of the WPC Indemnitees relating to, arising out of or resulting from any of the
following (without duplication):
(a) any
NLOP Liability, including the failure of any member of the NLOP Group or any other Person to pay, perform or otherwise promptly discharge
any NLOP Liabilities in accordance with their respective terms, whether prior to, at or after the Effective Time;
(b) any
breach by any member of the NLOP Group of any provision of this Agreement or of any of the Ancillary Agreements, subject to any limitations
of liability provisions and other provisions applicable to any such breach set forth therein;
(c) any
untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to
be stated therein or necessary to make the statements therein not misleading, with respect to all information contained in the Registration
Statement or the Information Statement other than information that relates solely to the WPC Assets;
in each case, regardless of when or where the
loss, claim, accident, occurrence, event or happening giving rise to the Loss took place, or whether any such loss, claim, accident,
occurrence, event or happening is known or unknown, or reported or unreported and regardless of whether such loss, claim, accident, occurrence,
event or happening giving rise to the Loss existed prior to, on or after the Distribution Date or relates to, arises out of or results
from actions, inactions, events, omissions, conditions, facts or circumstances occurring or existing prior to, on or after the Distribution
Date; provided, however, that no member of the NLOP Group shall have any obligation under this Article IX to
indemnify any member of the WPC Group against any Losses to the extent that such Losses arise by virtue of a breach of this Agreement
by a member of the WPC Group or the gross negligence, willful misconduct or fraud of any member of the WPC Group. As used in this Section 9.2,
“Appropriate Member of the NLOP Group” means the member or members of the NLOP Group, if any, whose acts, conduct
or omissions or failures to act caused, gave rise to or resulted in the Loss from and against which indemnity is provided.
Section 9.3 Indemnification
by WPC. Except as provided in Section 9.4 and Section 9.5, WPC shall, and, in the case of Section 9.3(a) or
Section 9.3(b), shall in addition cause each Appropriate Member of the WPC Group to, indemnify, defend and hold harmless
the NLOP Indemnitees from and against any and all Losses of the NLOP Indemnitees relating to, arising out of or resulting from any of
the following (without duplication):
(a) any
WPC Liability, including the failure of any member of the WPC Group or any other Person to pay, perform or otherwise promptly discharge
any WPC Liabilities in accordance with their respective terms, whether prior to, at or after the Effective Time;
(b) any
breach by any member of the WPC Group of any provision of this Agreement or of any of the Ancillary Agreements, subject to any limitations
of liability provisions and other provisions applicable to any such breach set forth therein; and
(c) any
untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to
be stated therein or necessary to make the statements therein not misleading, solely with respect to information contained in the Registration
Statement or the Information Statement that relates solely to the WPC Assets;
in each case, regardless of when or where the
loss, claim, accident, occurrence, event or happening giving rise to the Loss took place, or whether any such loss, claim, accident,
occurrence, event or happening is known or unknown, or reported or unreported and regardless of whether such loss, claim, accident, occurrence,
event or happening giving rise to the Loss existed prior to, on or after the Distribution Date or relates to, arises out of or results
from actions, inactions, events, omissions, conditions, facts or circumstances occurring or existing prior to, on or after the Distribution
Date; provided, however, that no member of the WPC Group shall have any obligation under this Article IX to
indemnify any member of the NLOP Group against any Losses to the extent that such Losses arise by virtue of a breach of this Agreement
by a member of the NLOP Group or the gross negligence, willful misconduct or fraud of any member of the NLOP Group. As used in this Section 9.3,
“Appropriate Member of the WPC Group” means the member or members of the WPC Group, if any, whose acts, conduct or
omissions or failures to act caused, gave rise to or resulted in the Loss from and against which indemnity is provided.
Section 9.4 Procedures
for Indemnification.
(a) An
Indemnitee shall give prompt notice of any matter that such Indemnitee has determined has given or would reasonably be expected to give
rise to a right of indemnification under this Agreement or any Ancillary Agreement (other than a Third-Party Claim which shall be governed
by Section 9.4(b)) to any Party that is or may be required pursuant to this Agreement or any Ancillary Agreement to make
such indemnification (the “Indemnifying Party”) promptly (and in any event within fifteen (15) days) after making
such a determination. Such notice shall state the amount of the Loss claimed, if known, and method of computation thereof, and contain
a reference to the provisions of this Agreement or the applicable Ancillary Agreement in respect of which such right of indemnification
is claimed by such Indemnitee; provided, however, that the failure to provide such notice shall not release the Indemnifying
Party from any of its obligations except and solely to the extent the Indemnifying Party shall have been materially prejudiced as a result
of such failure.
(b) If
a claim or demand is made against an Indemnitee by any Person who is not a Party to this Agreement or an Affiliate of a Party (a “Third-Party
Claim”) as to which such Indemnitee is or reasonably expects to be entitled to indemnification pursuant to this Agreement,
such Indemnitee shall promptly notify the Indemnifying Party in writing, and in reasonable detail, of the Third-Party Claim (and in any
event within thirty (30) days) after receipt by such Indemnitee of written notice of the Third-Party Claim; provided, however,
that the failure to provide notice of any such Third-Party Claim pursuant to this sentence shall not release the Indemnifying Party from
any of its obligations except and solely to the extent the Indemnifying Party shall have been materially prejudiced as a result of such
failure (except that the Indemnifying Party or Parties shall not be liable for any expenses incurred by the Indemnitee in defending such
Third-Party Claim during the period in which the Indemnitee failed to give such notice). Thereafter, the Indemnitee shall promptly deliver
to the Indemnifying Party (and in any event within ten (10) days) after the Indemnitee’s receipt thereof, copies of all notices
and documents (including court papers) received by the Indemnitee relating to the Third-Party Claim.
(c) An
Indemnifying Party shall be entitled (but shall not be required) to assume, control the defense of, and settle any Third-Party Claim,
at such Indemnifying Party’s own cost and expense and by such Indemnifying Party’s own counsel, which counsel must be reasonably
acceptable to the Indemnitee, if it gives written notice of its intention to do so (including a statement that the Indemnitee is entitled
to indemnification under this Article IX) to the applicable Indemnitees within thirty (30) days of the receipt of notice
from such Indemnitees of the Third-Party Claim (failure of the Indemnifying Party to respond within such thirty (30) day period shall
be deemed to be an election by the Indemnifying Party not to assume the defense for such Third-Party Claim). After a notice from an Indemnifying
Party to an Indemnitee of its election to assume the defense of a Third-Party Claim, such Indemnitee shall have the right to employ separate
counsel and to participate in (but not control) the defense, compromise or settlement thereof, at its own expense and, in any event,
shall reasonably cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party all witnesses and
information in such Indemnitee’s possession or under such Indemnitee’s control relating thereto as are reasonably required
by the Indemnifying Party; provided, however, that such access shall not require the Indemnitee to disclose any information
the disclosure of which would, in the good faith judgment of the Indemnitee, result in the loss of any existing privilege with respect
to such information or violate any applicable Law.
(d) Notwithstanding
anything to the contrary in this Section 9.4, in the event that (i) an Indemnifying Party elects not to assume the defense
of a Third-Party Claim, (ii) there exists a conflict of interest or potential conflict of interest between the Indemnifying Party
and the Indemnitee, (iii) any Third-Party Claim seeks an order, injunction or other equitable relief or relief for other than money
damages against the Indemnitee, (iv) the Indemnitee’s exposure to Liability in connection with such Third-Party Claim is reasonably
expected to exceed the Indemnifying Party’s exposure in respect of such Third-Party Claim taking into account the indemnification
obligations hereunder, or (v) the Person making such Third-Party Claim is a Governmental Authority with regulatory authority over
the Indemnitee or any of its material Assets, such Indemnitee shall be entitled to control the defense of such Third-Party Claim, at
the Indemnifying Party’s expense, with counsel of such Indemnitee’s choosing (such counsel to be reasonably acceptable to
the Indemnifying Party). If the Indemnitee is conducting the defense against any such Third-Party Claim, the Indemnifying Party shall
reasonably cooperate with the Indemnitee in such defense and make available to the Indemnitee all witnesses and information in such Indemnifying
Party’s possession or under such Indemnifying Party’s control relating thereto as are reasonably required by the Indemnitee;
provided, however, that such access shall not require the Indemnifying Party to disclose any information the disclosure
of which would, in the good faith judgment of the Indemnifying Party, result in the loss of any existing privilege with respect to such
information or violate any applicable Law.
(e) Unless
the Indemnifying Party has failed to assume the defense of the Third-Party Claim in accordance with the terms of this Agreement, no Indemnitee
may settle or compromise any Third-Party Claim without the consent of the Indemnifying Party (not to be unreasonably withheld, conditioned
or delayed). If an Indemnifying Party has failed to assume the defense of the Third-Party Claim, it shall not be a defense to any obligation
to pay any amount in respect of such Third-Party Claim that the Indemnifying Party was not consulted in the defense thereof, that such
Indemnifying Party’s views or opinions as to the conduct of such defense were not accepted or adopted, that such Indemnifying Party
does not approve of the quality or manner of the defense thereof or that such Third-Party Claim was incurred by reason of a settlement
rather than by a judgment or other determination of liability.
(f) In
the case of a Third-Party Claim, no Indemnifying Party shall consent to entry of any judgment or enter into any settlement of the Third-Party
Claim without the consent (not to be unreasonably withheld, conditioned or delayed) of the Indemnitee if the effect thereof is to permit
any injunction, declaratory judgment, other order or other non-monetary relief to be entered, directly or indirectly, against any Indemnitee,
does not release the Indemnitee from all liabilities and obligations with respect to such Third-Party Claim or includes an admission
of guilt or liability on behalf of the Indemnitee.
(g) Absent
fraud or intentional misconduct by an Indemnifying Party, the indemnification provisions of this Article IX shall be the
sole and exclusive remedy of an Indemnitee for any monetary or compensatory damages or Losses resulting from any breach of this Agreement
or any Ancillary Agreement, and each Indemnitee expressly waives and relinquishes any and all rights, claims or remedies such Person
may have with respect to the foregoing other than under this Article IX against any Indemnifying Party.
Section 9.5 Indemnification
Obligations Net of Insurance Proceeds. The Parties intend that any Loss subject to indemnification or reimbursement pursuant to this
Article IX (an “Indemnifiable Loss”) will be net of Insurance Proceeds that actually reduce the amount
of the Loss. Accordingly, the amount which an Indemnifying Party is required to pay to any Indemnitee will be reduced by any Insurance
Proceeds actually recovered by or on behalf of the Indemnitee in reduction of the related Loss. If an Indemnitee receives a payment (an
“Indemnity Payment”) required by this Agreement from an Indemnifying Party in respect of any Loss and subsequently
receives Insurance Proceeds to which the Indemnitee is entitled, the Indemnitee will pay to the Indemnifying Party an amount equal to
the excess of the Indemnity Payments received over the amount of the Indemnity Payments that would have been due if the Insurance Proceeds
recovery had been received, realized or recovered before the Indemnity Payments were made. The Indemnitee shall use and cause its Affiliates
to use commercially reasonable efforts to recover any Insurance Proceeds to which the Indemnitee is entitled with respect to any Indemnifiable
Loss. The existence of a claim by an Indemnitee for insurance proceeds or against a third party in respect of any Indemnifiable Loss
shall not, however, delay any payment pursuant to the indemnification provisions contained in this Article IX and otherwise
determined to be due and owing by an Indemnifying Party; rather, the Indemnifying Party shall make payment in full of such amount so
determined to be due and owing by it against a concurrent written assignment by the Indemnitee to the Indemnifying Party of the portion
of the claim of the Indemnitee for such insurance or against such third party equal to the amount of such payment. The Indemnitee shall
use and cause its Affiliates to use commercially reasonable efforts to assist the Indemnifying Party in recovering or to recover on behalf
of the Indemnifying Party, any Insurance Proceeds to which the Indemnifying Party is entitled with respect to any Indemnifiable Loss
as a result of such assignment. The Indemnitee shall make available to the Indemnifying Party and its counsel all employees, books and
records, communications, documents, items or matters within its knowledge, possession or control that are necessary, appropriate or reasonably
deemed relevant by the Indemnifying Party with respect to the recovery of such Insurance Proceeds; provided, however, that nothing in
this sentence shall be deemed to require a Party to make available books and records, communications, documents or items which (i) in
such Party’s good faith judgment could result in a waiver of any privilege even if the Parties cooperated to protect such privilege
as contemplated by this Agreement or (ii) such Party is not permitted to make available because of any Law or any confidentiality
obligation to a third party, in which case such Party shall use commercially reasonable efforts to seek a waiver of or other relief from
such confidentiality restriction. Unless the Indemnifying Party has made payment in full of any Indemnifiable Loss, such Indemnifying
Party shall use and cause its Affiliates to use commercially reasonable efforts to recover any Insurance Proceeds to which it or such
Affiliate is entitled with respect to any Indemnifiable Loss.
Section 9.6 Contribution.
If the indemnification provided for in this Article IX is unavailable to an Indemnitee in respect of any Indemnifiable Loss,
then the Indemnifying Party, in lieu of indemnifying such Indemnitee, shall contribute to the Losses paid or payable by such Indemnitee
as a result of such Indemnifiable Loss in such proportion as is appropriate to reflect the relative fault of NLOP and each other member
of the NLOP Group, on the one hand, and WPC and each other member of the WPC Group, on the other hand, in connection with the circumstances
which resulted in such Indemnifiable Loss.
Section 9.7 Remedies
Cumulative. The remedies provided in this Article IX shall be cumulative and, subject to the provisions of Article X,
shall not preclude assertion by any Indemnitee of any other rights or the seeking of any and all other remedies against any Indemnifying
Party.
Section 9.8 Survival
of Indemnities. The rights and obligations of each of the Parties and their respective Indemnitees under this Article IX
shall survive the Distribution Date indefinitely, unless a specific survival or other applicable period is expressly set forth herein,
and shall survive the sale or other transfer by any Party or any of its Subsidiaries of any Assets or businesses or the assignment by
it of any Liabilities.
Section 9.9 Limitation
of Liability. EXCEPT TO THE EXTENT SPECIFICALLY PROVIDED IN ANY ANCILLARY AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE LIABLE
TO THE OTHER PARTY FOR ANY EXEMPLARY, PUNITIVE, SPECIAL, INDIRECT, CONSEQUENTIAL, REMOTE OR SPECULATIVE DAMAGES (INCLUDING IN RESPECT
OF LOST PROFITS OR REVENUES), HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY (INCLUDING NEGLIGENCE) ARISING IN ANY WAY OUT OF ANY PROVISION
OF THIS AGREEMENT, WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Article X
DISPUTE
RESOLUTION
Section 10.1 Appointed
Representative. Each Party shall appoint a representative who shall be responsible for administering the dispute resolution provisions
in Section 10.2 (each, an “Appointed Representative”). Each Appointed Representative shall have the authority
to resolve any Agreement Disputes on behalf of the Party appointing such representative.
Section 10.2 Negotiation
and Dispute Resolution.
(a) Except
as otherwise provided in this Agreement or in any Ancillary Agreement, in the event of a controversy, dispute or claim arising out of,
in connection with, or in relation to the interpretation, performance, nonperformance, validity, termination or breach of this Agreement
or any Ancillary Agreement or otherwise arising out of, or in any way related to this Agreement or any Ancillary Agreement or any of
the transactions contemplated hereby or thereby (each, an “Agreement Dispute”), the Appointed Representatives shall
negotiate in good faith for thirty (30) days to settle any such Agreement Dispute.
(b) Nothing
said or disclosed, nor any document produced, in the course of any negotiations, conferences and discussions in connection with efforts
to settle an Agreement Dispute that is not otherwise independently discoverable shall be offered or received as evidence or used for
impeachment or for any other purpose, but shall be considered as to have been disclosed for settlement purposes.
(c) If
a satisfactory resolution of any Agreement Dispute is not achieved by the Appointed Representatives within thirty (30) days, each Party
will be entitled to refer the dispute to arbitration in accordance with Section 10.3.
Section 10.3 Arbitration.
(a) If
a satisfactory resolution of any Agreement Dispute is not achieved by the Appointed Representatives within thirty (30) days, such Agreement
Dispute shall, on the demand of either Party, be resolved through binding and final arbitration in accordance with the Commercial Arbitration
Rules (the “Rules”) of the American Arbitration Association (“AAA”) then in effect, except
as those Rules may be modified in this Section 10.3.
(b) There
shall be three (3) arbitrators. Each Party shall select one (1) arbitrator within fifteen (15) days after receipt by respondent
of a copy of the demand for arbitration. The arbitrators may be affiliated or interested persons of the Parties. If either Party fails
to timely select an arbitrator then the Party who has selected an arbitrator may request AAA to provide a list of three (3) proposed
arbitrators in accordance with the Rules (each of whom shall be neutral, impartial and unaffiliated with either Party) and the Party
that failed to timely appoint an arbitrator shall have ten (10) days from the date AAA provides the list to select one (1) of
the three (3) arbitrators proposed by AAA. If the Party fails to select the second (2nd) arbitrator by that time, the
Party who has appointed the first (1st ) arbitrator shall then have ten (10) days to select one (1) of the three
(3) arbitrators proposed by AAA to be the second (2nd) arbitrator; and if such Party should fail to select the second
(2nd) arbitrator by such time, AAA shall select, within fifteen (15) days thereafter, one (1) of the three (3) arbitrators
it had proposed as the second (2nd) arbitrator. The two (2) arbitrators so appointed shall jointly appoint the third
(3rd) and presiding arbitrator (who shall be neutral and impartial and unaffiliated with either Party) within fifteen (15)
days of the appointment of the second (2nd) arbitrator. If the third (3rd) arbitrator has not been appointed within
the time limit specified herein, then AAA shall provide a list of proposed arbitrators in accordance with the Rules, and the arbitrator
shall be appointed by AAA in accordance with a listing, striking and ranking procedure, with each Party having a limited number of strikes,
excluding strikes for cause.
(c) The
place of arbitration shall be New York, New York, unless otherwise agreed by the Parties.
(d) There
shall be only limited documentary discovery of documents directly related to the issues in dispute, as may be ordered by the arbitrators.
For the avoidance of doubt, it is intended that there shall be no depositions and no other discovery other than limited documentary discovery
as described in the preceding sentence.
(e) In
rendering an award or decision (the “Award”), the arbitrators shall be required to follow the laws of the State of
Maryland. Any arbitration proceedings or award rendered hereunder and the validity, effect and interpretation of this arbitration agreement
shall be governed by the Federal Arbitration Act, 9 U.S.C. §1 et seq. Any award shall be subject to the provisions of Section 9.9.
The Award shall be in writing and shall state the findings of fact and conclusions of law on which it is based. Any monetary award shall
be made and payable in U.S. dollars. Subject to Section 10.3(g), the Party against which the Award assesses a monetary obligation
shall pay that obligation on or before the thirtieth (30th) day following the date of the Award or such other date as the
Award may provide.
(f) Except
to the extent expressly provided by this Agreement or as otherwise agreed by the Parties, each Party shall bear its own costs and expenses
(including attorneys’ fees), and the arbitrators shall not render an award that would include shifting of any such costs or expenses
(including attorneys’ fees). Each Party shall bear the costs and expenses of its selected arbitrator and the Parties shall equally
bear the costs and expenses of the third (3rd) appointed arbitrator.
(g) Notwithstanding
any language to the contrary in this Agreement, the Award, including but not limited to, any interim Award, may be appealed pursuant
to the AAA’s Optional Appellate Arbitration Rules (“Appellate Rules”). The Award shall not be considered
final until after the time for filing the notice of appeal pursuant to the Appellate Rules has expired. Appeals must be initiated
within (30) days of receipt of the Award by filing a notice of appeal with any AAA office. Following the appeal process, the decision
rendered by the appeal tribunal may be entered in any court having jurisdiction thereof. For the avoidance of doubt, and despite any
contrary provision of the Appellate Rules, this Section 10.3(g) shall apply to any appeal pursuant to this Section 10.3(g) and
the appeal tribunal shall not render an award that would include shifting of any costs or expenses (including attorneys’ fees)
of either Party.
(h) Following
the expiration of the time for filing the notice of appeal, or the conclusion of the appeal process set forth in Section 10.3(g),
the Award shall be final and binding upon the Parties and shall be the sole and exclusive remedy between the Parties relating to the
Agreement Dispute, including any claims, counterclaims, issues or accounting presented to the arbitrators. Judgment upon the Award may
be entered in any court having jurisdiction. To the fullest extent permitted by law, no application or appeal to any court of competent
jurisdiction may be made in connection with any question of law arising in the course of arbitration or with respect to any award made
except for actions relating to enforcement of this agreement to arbitrate or any arbitral award issued hereunder and except for actions
seeking interim or other provisional relief in aid of arbitration proceedings in any court of competent jurisdiction.
(i) This
Section 10.3 is intended to benefit and be enforceable by the Parties and their respective successors and assigns and shall
be binding upon the Parties, and be in addition to, and not in substitution for, any other rights to indemnification or contribution
that such individuals or entities may have by contract or otherwise.
(j) The
arbitrators may consolidate arbitration under this Agreement with any arbitration arising under or relating to any of the Ancillary Agreements
if the subjects of the Agreement Disputes thereunder arise out of or relate essentially to the same set of facts or transactions. Such
consolidated arbitration will be determined by the arbitrators appointed for the arbitration proceeding that was commenced first in time.
(k) Unless
otherwise agreed in writing, the Parties will continue to provide service and honor all other commitments under this Agreement and each
Ancillary Agreement during the course of dispute resolution pursuant to the provisions of this Article X with respect to
all matters not subject to such dispute resolution.
Article XI
TERMINATION
Section 11.1 Termination.
Upon written notice, this Agreement and each of the Ancillary Agreements, may be terminated at any time prior to the Effective Time by
and in the sole discretion of WPC without the approval of any other Party.
Section 11.2 Effect
of Termination. In the event of termination pursuant to Section 11.1, neither Party shall have any Liability of any kind
to the other Party.
Article XII
MISCELLANEOUS
Section 12.1 Further
Assurances. Subject to the limitations or other provisions of this Agreement, (a) each Party shall, and shall cause the other
members of its Group to, use commercially reasonable efforts (subject to, and in accordance with applicable Law) to take promptly, or
cause to be taken promptly, all actions, and to do promptly, or cause to be done promptly, and to assist and cooperate with the other
Party in doing, all things reasonably necessary, proper or advisable to consummate and make effective the Transactions and to carry out
the intent and purposes of this Agreement, including using commercially reasonable efforts to obtain satisfaction of the conditions precedent
in Article V within its reasonable control, and to perform all covenants and agreements herein applicable to such Party or
any member of its Group and (b) neither Party will, nor will either Party allow any other member of its Group to, without the prior
written consent of the other Party, take any action which would reasonably be expected to prevent or materially impede, interfere with
or delay any of the Transactions. Without limiting the generality of the foregoing, where the cooperation of third parties, such as insurers
or trustees, would be necessary in order for a Party to completely fulfill its obligations under this Agreement, such Party shall use
commercially reasonable efforts to cause such third parties to provide such cooperation.
Section 12.2 Payment
of Expenses. All costs and expenses incurred related to this Agreement, the Ancillary Agreements and the Transactions on or prior
to the Distribution Date, shall be the responsibility of NLOP and paid by NLOP (or, if paid by WPC, reimbursed by NLOP). Following the
Separation, unless as otherwise set forth in the Ancillary Agreements or else agreed in writing by the Parties, each Party shall pay
their own costs and expenses.
Section 12.3 Amendments
and Waivers.
(a) Subject
to Section 11.1, this Agreement may not be amended except by an agreement in writing signed by both Parties.
(b) Any
term or provision of this Agreement may be waived, or the time for its performance may be extended, by the Party entitled to the benefit
thereof and any such waiver shall be validly and sufficiently given for the purposes of this Agreement if it is in writing signed by
an authorized representative of such Party. No delay or failure in exercising any right, power or remedy hereunder shall affect or operate
as a waiver thereof; nor shall any single or partial exercise thereof or any abandonment or discontinuance of steps to enforce such a
right, power or remedy preclude any further exercise thereof or of any other right, power or remedy. The rights and remedies hereunder
are cumulative and not exclusive of any rights or remedies that either Party would otherwise have.
Section 12.4 Entire
Agreement. This Agreement, the Ancillary Agreements, and the Exhibits and Schedules referenced herein and therein and attached hereto
or thereto, constitute the entire agreement and understanding between the Parties with respect to the subject matter hereof and supersede
all prior negotiations, agreements, commitments, writings, courses of dealing and understandings with respect to the subject matter hereof.
Section 12.5 Survival
of Agreements. Except as otherwise expressly contemplated by this Agreement, all covenants and agreements of the Parties contained
in this Agreement shall survive the Effective Time and remain in full force and effect in accordance with their applicable terms.
Section 12.6 Third
Party Beneficiaries. Except (a) as provided in Article IX relating to Indemnitees and for the release of any Person
provided under Section 9.1, (b) as provided in Section 7.1 relating to insured persons and (c) as provided
in Section 8.1(a), this Agreement is solely for the benefit of the Parties and should not be deemed to confer upon third
parties any remedy, claim, liability, reimbursement, cause of action or other right in excess of those existing without reference to
this Agreement.
Section 12.7 Notices.
All notices, requests, permissions, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly
given (a) five (5) Business Days following sending by registered or certified mail, postage prepaid, (b) when sent, if
sent by facsimile, (c) when delivered, if delivered personally to the intended recipient, and (d) one (1) Business Day
following sending by overnight delivery via a national courier service and, in each case, addressed to a Party at the following address
for such Party:
(a) If
to WPC:
One Manhattan West
395 Ninth Avenue
New York, NY 10001
Attention: Chief Legal Officer
(b) If
to NLOP:
c/o W. P. Carey Inc.
One Manhattan West
395 Ninth Avenue
New York, NY 10001
Attention: Chief Legal Officer
Section 12.8 Counterparts;
Electronic Delivery. This Agreement may be executed in multiple counterparts, each of which when executed shall be deemed to be an
original, but all of which together shall constitute one and the same agreement. Execution and delivery of this Agreement or any other
documents pursuant to this Agreement by facsimile or other electronic means shall be deemed to be, and shall have the same legal effect
as, execution by an original signature and delivery in person.
Section 12.9 Severability.
If any term or other provision of this Agreement or the Exhibits and Schedules attached hereto or thereto is determined by a nonappealable
decision by a court, administrative agency or arbitrator to be invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as
the economic or legal substance of the Transactions is not affected in any manner materially adverse to either Party. Upon such determination
that any term or other provision is invalid, illegal or incapable of being enforced, the court, administrative agency or arbitrator shall
interpret this Agreement so as to affect the original intent of the Parties as closely as possible in an acceptable manner to the end
that the Transactions are fulfilled to the fullest extent possible. If any sentence in this Agreement is so broad as to be unenforceable,
the provision shall be interpreted to be only as broad as is enforceable.
Section 12.10 Assignability;
Binding Effect. This Agreement shall be binding upon and inure to the benefit of the Parties and their successors and permitted assigns;
provided, however, that the rights and obligations of each Party under this Agreement shall not be assignable, in whole or in part, directly
or indirectly, whether by operation of law or otherwise, by such Party without the prior written consent of the other Party (such consent
not to be unreasonably withheld, conditioned or delayed) and any attempt to assign any rights or obligations under this Agreement without
such consent shall be null and void. Notwithstanding the foregoing, either Party may assign its rights and obligations under this Agreement
to any of their respective Affiliates provided that no such assignment shall release such assigning Party from any liability or obligation
under this Agreement.
Section 12.11 Governing
Law. This Agreement shall be governed by, and construed and enforced in accordance with, the substantive laws of the State of New
York, without regard to any conflicts of law provisions thereof that would result in the application of the laws of any other jurisdiction.
Section 12.12 Construction.
This Agreement shall be construed as if jointly drafted by the Parties and no rule of construction or strict interpretation shall
be applied against either Party. The Parties represent that this Agreement is entered into with full consideration of any and all rights
which the Parties may have. The Parties have relied upon their own knowledge and judgment. The Parties have had access to independent
legal advice, have conducted such investigations they thought appropriate, and have consulted with such other independent advisors as
they deemed appropriate regarding this Agreement and their rights and asserted rights in connection therewith. The Parties are not relying
upon any representations or statements made by the other Party, or such other Party’s employees, agents, representatives or attorneys,
regarding this Agreement, except to the extent such representations are expressly set forth or incorporated in this Agreement. The Parties
are not relying upon a legal duty, if one exists, on the part of the other Party (or such other Party’s employees, agents, representatives
or attorneys) to disclose any information in connection with the execution of this Agreement or their preparation, it being expressly
understood that neither Party shall ever assert any failure to disclose information on the part of the other Party as a ground for challenging
this Agreement.
Section 12.13 Performance.
Each Party shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth herein
to be performed by any Subsidiary or Affiliate of such Party.
Section 12.14 Title
and Headings. Titles and headings to Sections and Articles are inserted for the convenience of reference only and are not intended
to be a part of or to affect the meaning or interpretation of this Agreement.
Section 12.15 Exhibits
and Schedules. The Exhibits and Schedules attached hereto are incorporated herein by reference and shall be construed with and as
an integral part of this Agreement to the same extent as if the same had been set forth verbatim herein.
Section 12.16 Exclusivity
of Tax Matters. Notwithstanding any other provision of this Agreement (other than Sections 2.2(b)(v), 4.3(b), 4.3(c),
and 7.3), the Tax Matters Agreement shall exclusively govern all matters related to Taxes (including allocations thereof) addressed
therein.
[Signature Page Follows]
IN WITNESS WHEREOF, the Parties
have caused this Agreement to be executed by their respective officers as of the date first set forth above.
|
W. P. Carey
Inc. |
|
|
|
|
|
By: |
/s/
ToniAnn Sanzone |
|
|
Name: |
ToniAnn Sanzone |
|
|
Title: |
Chief Financial Officer |
|
|
|
Net Lease
Office Properties |
|
|
|
|
|
By: |
/s/
Jason E. Fox |
|
|
Name: |
Jason E. Fox |
|
|
Title: |
Chief Financial Officer |
[Signature Page to Separation
and Distribution Agreement]
ExhibiT
A
NLOP
Subsidiaries
Subsidiary | |
State/Country of Incorporation/Formation |
NLO OP LLC | |
Delaware |
NLO Mezzanine Borrower LLC | |
Delaware |
NLO Pledgor LLC | |
Delaware |
NLO MB TRS LLC | |
Delaware |
NLO Holding Company LLC | |
Delaware |
NLO SubREIT LLC | |
Delaware |
NLO International Holding LP | |
Delaware |
NLO International Holding GP TRS LLC | |
Delaware |
NLO Financing B.V. | |
Netherlands |
NLO Holding B.V. | |
Netherlands |
308 Route 38 LLC | |
Delaware |
500 Jefferson Tower (TX) LLC | |
Delaware |
6000 Nathan (MN) LLC | |
Delaware |
601 Jefferson Manager (DE) LLC | |
Delaware |
601 Jefferson Tower (TX) LLC | |
Delaware |
ADS2 (CA) LLC | |
Delaware |
AIRLIQ (TX) LLC | |
Delaware |
AUTOPRO (GA) LLC | |
Delaware |
Call LLC | |
Delaware |
Develop (TX) LP | |
Delaware |
Drug (AZ) LLC | |
Delaware |
FLOUR POWER (OH) LLC | |
Delaware |
GRC-II (TX) LLC | |
Delaware |
GRC-II (TX) Limited Partnership | |
Delaware |
Health Landlord (MN) LLC | |
Delaware |
HM Benefits (MI) LLC | |
Delaware |
HNGS AUTO (MI) LLC | |
Delaware |
ICall BTS (VA) LLC | |
Delaware |
JPCENTRE (TX) LLC | |
Delaware |
JPCENTRE Manager (TX) LLC | |
Delaware |
JPTampa Management (FL) LLC | |
Delaware |
Medi (PA) LLC | |
Delaware |
Mercury (MI) LLC | |
Delaware |
Metaply (MI) LLC | |
Delaware |
Morisek Hoffman (IL) LLC | |
Delaware |
Morrisville Landlord (NC) LP | |
Delaware |
Morrisville Landlord GP (NC) LLC | |
Delaware |
Oak Creek 17 Investor (WI) LLC | |
Delaware |
Popcorn (TX) LLC | |
Delaware |
RACO (AZ) LLC | |
Delaware |
Roosevelt Blvd North (FL) LLC | |
Delaware |
RRD (IL) LLC | |
Delaware |
RUSH IT LLC | |
Delaware |
Spring Forest Road (NC) LLC | |
Delaware |
Stone Oak 17 (TX) LLC | |
Delaware |
Telegraph (MO) LLC | |
Delaware |
Truth (MN) LLC | |
Delaware |
USO Landlord (TX) LLC | |
Delaware |
Vandenburg Blvd (PA) LLC | |
Delaware |
WPC Crown Colony (MA) LLC | |
Delaware |
(CA) ADS, LLC | |
Delaware |
Avasu (AZ) LLC | |
Delaware |
Avasu (AZ) Transferee LLC | |
Delaware |
Boom (MN) LLC | |
Delaware |
Boom (MN) Transferee LLC | |
Delaware |
CII Landlord (IL) LLC | |
Delaware |
CII Landlord (IL) MM LLC | |
Delaware |
GRC GP (TX) LLC | |
Delaware |
GRC (TX) LP | |
Delaware |
Hawk (IA) LLC | |
Delaware |
Hawk Landlord (IA) LLC | |
Delaware |
Hawk JV Landlord (IA) LLC | |
Delaware |
Jax Costa (FL) LLC | |
Delaware |
Jax Costa Transferee LLC | |
Delaware |
Jax Costa Transferee Principal LLC | |
Delaware |
Merge (WI) LLC | |
Delaware |
Merge (WI) Transferee LLC | |
Delaware |
MIS EGN (MN) LLC | |
Delaware |
MIS-EGN (MN) Transferee LLC | |
Delaware |
Orlando Storage 17 (FL) LLC | |
Delaware |
Turbo Headquarters (TX) LLC | |
Delaware |
Turbo Headquarters (TX) Transferee LLC | |
Delaware |
Venice (CA) LP | |
Delaware |
Venice (CA) Transferee LLC | |
Delaware |
Venice (CA) Transferee Principal LLC | |
Delaware |
ØAV 88 AS | |
Norway |
Finnestadveien 44 II AS | |
Norway |
NLO Admir B.V. | |
Netherlands |
NLO Npow B.V. | |
Netherlands |
NLOP Noki Sp. z o.o. | |
Poland |
Exhibit 10.2
TAX MATTERS AGREEMENT
BY AND BETWEEN
W. P. CAREY INC.
AND
NET LEASE OFFICE PROPERTIES
DATED AS OF OCTOBER 31, 2023
TABLE OF CONTENTS
Page
Article 1 Definitions |
2 |
|
|
|
Section 1.1 |
Definitions |
2 |
|
Section 1.2 |
Interpretation and Rules of Construction |
6 |
|
|
|
|
Article 2 Allocation of Taxes |
7 |
|
|
|
Section 2.1 |
General Rule |
7 |
|
Section 2.2 |
General Allocation Principles |
7 |
|
Section 2.3 |
Allocation Conventions |
8 |
|
Section 2.4 |
Transfer Taxes |
8 |
|
|
|
|
Article 3 Tax Returns |
8 |
|
|
|
Section 3.1 |
WPC Separate Returns and Joint Returns |
8 |
|
Section 3.2 |
NLOP Separate Tax Returns |
8 |
|
Section 3.3 |
Tax Reporting Practices |
9 |
|
Section 3.4 |
Adjustments |
9 |
|
Section 3.5 |
Tax Attributes |
9 |
|
|
|
|
Article 4 Tax Payments & Benefits |
9 |
|
|
|
Section 4.1 |
Taxes Shown on Tax Returns |
9 |
|
Section 4.2 |
Certain Adjustments Resulting in Underpayments |
9 |
|
Section 4.3 |
Indemnification Payments |
10 |
|
Section 4.4 |
Tax Refunds |
10 |
|
|
|
|
Article 5 [Reserved] |
10 |
|
|
|
Article 6 Assistance and Cooperation |
10 |
|
|
|
Section 6.1 |
Assistance and Cooperation |
10 |
|
Section 6.2 |
Tax Return Information |
11 |
|
|
|
|
Article 7 Tax Records |
11 |
|
|
|
Section 7.1 |
Retention of Tax Records |
11 |
|
Section 7.2 |
Access to Tax Records |
12 |
|
Section 7.3 |
Preservation of Privilege |
12 |
|
|
|
|
Article 8 Tax Contests |
12 |
|
|
|
Section 8.1 |
Notice |
12 |
|
Section 8.2 |
Control of Tax Contests |
12 |
|
|
|
|
Article 9 Tax Treatment of Payments |
14 |
|
|
Article 10 Indemnification Payment Escrow |
14 |
|
|
Article 11 General Provisions |
15 |
|
|
|
Section 11.1 |
Amendments and Waivers |
15 |
|
Section 11.2 |
Survival of Obligations |
15 |
|
Section 11.3 |
Dispute Resolution |
15 |
|
Section 11.4 |
Notices |
16 |
|
Section 11.5 |
Severability |
16 |
|
Section 11.6 |
Counterparts |
17 |
|
Section 11.7 |
Entire Agreement; No Third-Party Beneficiaries |
17 |
|
Section 11.8 |
Governing Law |
17 |
|
Section 11.9 |
Assignment; Binding Effect |
17 |
|
Section 11.10 |
Remedies |
17 |
|
Section 11.11 |
Waiver of Jury Trial |
18 |
|
Section 11.12 |
Authorship |
18 |
TAX MATTERS AGREEMENT
This TAX MATTERS AGREEMENT
(this “Agreement”), dated as of October 31, 2023, is by and between W. P. Carey Inc., a Maryland corporation (“WPC”),
and Net Lease Office Properties (“NLOP”), a Maryland real estate investment trust and wholly-owned subsidiary of WPC.
Each of WPC and NLOP (and, solely with respect to Section 2.1(a)(iv) and Sections 1(b) and 3 of Appendix B, NLO Mezzanine
Borrower LLC (“Mezz Borrower”)) is sometimes referred to herein as a “Party” and collectively as
the “Parties.” Capitalized terms used but not otherwise defined herein have the meanings ascribed to them in the Separation
and Distribution Agreement dated as of October 31, 2023 by and among WPC and NLOP (the “Separation and Distribution Agreement”).
RECITALS
WHEREAS, WPC, through its
Subsidiaries, has previously acquired the NLOP Assets;
WHEREAS, NLOP intends to elect
to be treated as a real estate investment trust for federal income tax purposes (a "REIT”);
WHEREAS, WPC and NLOP have
entered into the Separation and Distribution Agreement, pursuant to which the Parties will complete the Separation, as provided for in
a series of contribution and transfer agreements pursuant to Article II of the Separation and Distribution Agreement, whereby WPC
has contributed (i) certain NLOP Assets and (ii) 100% of the equity interests in each entity holding the remainder of the NLOP
Assets, to NLOP or a NLOP Subsidiary;
WHEREAS, pursuant to the Separation
and Distribution Agreement, on the Distribution Date, WPC will complete the distribution of NLOP Common Shares to each Record Holder,
as set forth more fully in Section 4.3 of the Separation and Distribution Agreement (such distribution transaction, the “Distribution”);
and
WHEREAS, the Parties desire
to set forth their agreement on the rights and obligations of the Parties with respect to (A) the administration and allocation of
federal, state, local, and foreign Taxes incurred in Tax Periods beginning prior to the date of the Distribution (the “Distribution
Date”), (B) Taxes resulting from the Distribution and transactions effected in connection with the Distribution and (C) various
other Tax matters;
NOW THEREFORE, in consideration
of the foregoing and the mutual representations, warranties, covenants and agreements contained in this Agreement, and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree
as follows:
Article 1
Definitions
Section 1.1 Definitions.
(a) For
purposes of this Agreement:
“Adjustment Request”
means any formal or informal claim or request filed with any Tax Authority, or with any administrative agency or court, for the adjustment,
refund, or credit of Taxes, including (i) any amended Tax Return claiming adjustment to the Taxes as reported on the Tax Return
or, if applicable, as previously adjusted, (ii) any claim for equitable recoupment or other offset, and (iii) any claim for
refund or credit of Taxes previously paid.
“Agreement Dispute”
has the meaning set forth in the Separation and Distribution Agreement.
“Allowed Amount”
has the meaning set forth in Article 10 of this Agreement.
“Ancillary Agreement”
has the meaning set forth in the Separation and Distribution Agreement.
“Boot”
has the meaning set forth in Appendix A.
“Business Day”
has the meaning set forth in the Separation and Distribution Agreement.
“Change in Control”
means any transaction or series of related transactions in which (a) all or substantially all of the assets of NLOP or WPC, as applicable,
are sold, assigned, hypothecated, pledged or otherwise transferred to a third party; or (b) possession or control of a controlling
portion of the equity interests in NLOP or WPC, as applicable, is directly or indirectly acquired by a third party.
“Controlling Party”
has the meaning set forth in Section 8.2(c) of this Agreement.
"Coverage Limit”
means the limitation on WPC’s indemnification of NLOP Group under Section 4.2 described in Appendix C.
“Coverage Period”
has the meaning set forth in Appendix C.
“Distribution Date”
has the meaning set forth in the recitals to this Agreement.
“Escrowed Amount”
has the meaning set forth in Article 11 of this Agreement.
“Final Determination”
means the final resolution of liability for any Tax, which resolution may be for a specific issue or adjustment or for any Tax Period,
(i) by IRS Form 870 or 870-AD (or any successor forms thereto), on the date of acceptance by or on behalf of the taxpayer, or
by a comparable form under the laws of a state, local, or foreign taxing jurisdiction, except that a Form 870 or 870-AD or comparable
form shall not constitute a Final Determination to the extent that it reserves (whether by its terms or by operation of law) the right
of the taxpayer to file a claim for refund or the right of the Tax Authority to assert a further deficiency in respect of such issue or
adjustment or for such Tax Period (as the case may be); (ii) by a decision, judgment, decree, or other order by a court of competent
jurisdiction, which has become final and unappealable; (iii) by a closing agreement or accepted offer in compromise under Sections
7121 or 7122 of the Code, or a comparable agreement under the laws of a state, local, or foreign taxing jurisdiction; (iv) by any
allowance of a refund or credit in respect of an overpayment of a Tax, but only after the expiration of all periods during which such
refund may be recovered (including by way of offset) by the jurisdiction imposing such Tax; (v) by a final settlement resulting from
a treaty-based competent authority determination; or (vi) by any other final disposition, including by reason of the expiration of
the applicable statute of limitations, the execution of a pre-filing agreement with the IRS or other Tax Authority, or by mutual agreement
of the Parties.
“Governmental Authority”
means any U.S. federal, state, local or non-U.S. court, government, department, commission, board, bureau, agency, official or other regulatory,
administrative or governmental authority.
“Group”
means either the NLOP Group or the WPC Group, as the context requires.
“Income Tax”
means all U.S. federal, state, local and foreign income, franchise or similar Taxes imposed on (or measured by) net income or net profits.
“Indemnification
Payee” has the meaning set forth in Article 10 of this Agreement.
“Indemnification
Payment” has the meaning set forth in Article 10 of this Agreement.
“Indemnification
Payor” has the meaning set forth in Article 10 of this Agreement.
“Intended
Tax Treatment” means the tax treatment set forth on Appendix A.
“Joint Return”
means any Tax Return that includes, by election or otherwise, one or more members of the WPC Group together with one or more members of
the NLOP Group.
“Mezz Borrower”
has the meaning set forth in the recitals to this Agreement.
“NLOP Assets”
has the meaning set forth in the Separation and Distribution Agreement.
“NLOP Common Shares”
has the meaning set forth in the Separation and Distribution Agreement.
“NLOP Financing Arrangements”
has the meaning set forth in the Separation and Distribution Agreement.
“NLOP Group”
means NLOP and the NLOP Subsidiaries.
“NLOP Separate Tax
Return” means any Tax Return of any member of the NLOP Group (including any consolidated, combined or unitary return) that does
not include any member of the WPC Group.
“NLOP Subsidiaries”
has the meaning set forth in the Separation and Distribution Agreement.
“Non-Controlling
Party” has the meaning set forth in Section 8.2(c) of this Agreement.
“Parties”
and “Party” have the meaning set forth in the preamble to this Agreement.
“Past Practices”
has the meaning set forth in Section 3.3(a) of this Agreement.
“Payor”
has the meaning set forth in Section 4.3(a) of this Agreement.
“Positive Tax Opinion
or Ruling” has the meaning set forth in Article 10 of this Agreement.
“Pre-Distribution
Tax Period” means any Tax period ending on or before the Distribution Date.
“Prime Rate”
means the “prime rate” as published in The Wall Street Journal, Eastern Edition.
“Prior Group”
means any group that filed or was required to file (or will file or be required to file) a Tax Return, for a Tax Period or portion thereof
ending at the close of the Distribution Date, , on an affiliated, consolidated, combined, unitary, fiscal unity or other group basis (including
as permitted by Section 1501 of the Code) that includes at least one member of the NLOP Group.
“Privilege”
means any privilege that may be asserted under applicable law, including, any privilege arising under or relating to the attorney-client
relationship (including the attorney-client and work product privileges), the accountant-client privilege and any privilege relating to
internal evaluation processes.
“Protected REIT”
means any entity that (i) has elected or intends to elect to be taxed as a REIT, and (ii) either (A) is an Indemnification
Payee or Required Party or (B) owns a direct or indirect equity interest in an Indemnification Payee or Required Party and is treated
for purposes of Section 856 of the Code as (x) owning all or a portion of the assets of such Indemnification Payee or Required
Party or (y) as receiving all or a portion of such Indemnification Payee’s or Required Party’s income.
“Qualifying Income”
has the meaning set forth in Article 11 of this Agreement.
“Record Holder”
has the meaning set forth in the Separation and Distribution Agreement.
“REIT”
has the meaning set forth in the preamble to this Agreement.
“Required Party”
has the meaning set forth in Section 4.3(a) of this Agreement.
“Responsible Party”
means, with respect to any Tax Return, the Party having responsibility for preparing and filing such Tax Return under this Agreement.
“Restructuring Transactions”
means those transactions identified on Appendix A.
“Retention Date”
has the meaning set forth in Section 8.1 of this Agreement.
“Ruling”
means a private letter ruling from the IRS regarding the Tax treatment of all or any part of the transactions contemplated by the Separation
and Distribution Agreement.
“Separation”
has the meaning set forth in the Separation and Distribution Agreement.
“Subsidiary”
has the meaning set forth in the Separation and Distribution Agreement.
“Tax” or
“Taxes” means any income, gross income, gross receipts, profits, capital stock, franchise, withholding, payroll, social
security, workers compensation, unemployment, disability, property, ad valorem, value added, stamp, excise, severance, occupation, service,
sales, use, license, lease, transfer, import, export, escheat, alternative minimum, universal service fund, estimated or other tax (including
any fee, assessment, or other charge in the nature of or in lieu of any tax), imposed by any Governmental Authority or political subdivision
thereof, and any interest, penalty, additions to tax or additional amounts in respect of the foregoing.
“Tax Advisor”
means a Tax counsel or accountant, in each case of recognized national standing.
“Tax Attribute”
means a net operating loss, net capital loss, unused investment credit, unused foreign Tax credit (including credits of a foreign company
under Section 902 of the Code), excess charitable contribution, general business credit, excess business interest expense carryforward,
earnings and profits, basis, or any other Tax Item that could reduce a Tax or create a Tax Benefit.
“Tax Authority”
means, with respect to any Tax, the Governmental Authority or political subdivision thereof that imposes such Tax, and the agency (if
any) charged with the collection of such Tax for such entity or subdivision.
“Tax Benefit”
means any refund, credit, or other item that causes reduction in otherwise required liability for Taxes.
“Tax Contest”
means an audit, review, examination, contest, litigation, investigation or any other administrative or judicial proceeding with the purpose
or effect of redetermining Taxes (including any administrative or judicial review of any claim for refund).
“Tax Item”
means, with respect to any Income Tax, any item of income, gain, loss, deduction, or credit.
“Tax Law”
means the law of any Governmental Authority or political subdivision thereof relating to any Tax.
“Tax Period”
means, with respect to any Tax, the period for which the Tax is reported as provided under the Code or other applicable Tax Law.
“Tax Records”
means any (i) Tax Returns, (ii) Tax Return workpapers, (iii) documentation relating to any Tax Contests, and (iv) any
other books of account or records (whether or not in written, electronic or other tangible or intangible forms and whether or not stored
on electronic or any other medium) maintained or required to be maintained under the Code or other applicable Tax Laws or under any record
retention agreement with any Tax Authority, in each case filed or required to be filed with respect to or otherwise relating to Taxes.
“Tax Return”
means any report of Taxes due, any claim for refund of Taxes paid, any information return with respect to Taxes, or any other similar
report, statement, declaration, or document filed or required to be filed under the Code or other Tax Law with respect to Taxes, including
any attachments, exhibits, or other materials submitted with any of the foregoing, and including any amendments or supplements to any
of the foregoing.
“Transfer Taxes”
means all sales, use, transfer, real property transfer, intangible, recordation, registration, documentary, stamp or similar Taxes imposed
in connection with the Restructuring Transactions or the Distribution (excluding in each case, for the avoidance of doubt, any Income
Taxes).
“Treasury Regulations”
means the regulations promulgated from time to time under the Code as in effect for the relevant Tax Period.
“WPC
Group” means WPC and the Subsidiaries of WPC other than NLOP and the NLOP Subsidiaries.
“WPC Separate Tax
Return” means any Tax Return of any member of the WPC Group (including any consolidated, combined or unitary return) that does
not include any member of the NLOP Group.
Section 1.2 Interpretation
and Rules of Construction. In this Agreement, except to the extent otherwise provided or that the context otherwise requires:
(a) when
a reference is made in this Agreement to an Article, Section or Exhibit, such reference is to an Article or Section of,
or an Exhibit to, this Agreement;
(b) the
table of contents and headings for this Agreement are for reference purposes only and do not affect in any way the meaning or interpretation
of this Agreement;
(c) whenever
the words “include,” “includes” or “including” are used in this Agreement, they are deemed to be
followed by the words “without limitation”;
(d) the
words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement,
refer to this Agreement as a whole and not to any particular provision of this Agreement;
(e) references
to any agreement, instrument, statute, rule or regulation are to the agreement, instrument, statute, rule or regulation as
amended, modified, supplemented or replaced from time to time, including (in the case of agreements or instruments) by waiver or consent
and (in the case of statutes) by succession of comparable successor statutes, and all attachments thereto and instruments incorporated
therein (and, in the case of statutes, include any rules and regulations promulgated under the statute);
(f) all
terms defined in this Agreement have the defined meanings when used in any certificate or other document made or delivered pursuant hereto,
unless otherwise defined therein;
(g) the
definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine
as well as the feminine and neuter genders of such terms;
(h) references
to a Person are also to its successors and permitted assigns;
(i) except
when used together with the word “either” or otherwise for the purpose of identifying mutually exclusive alternatives, the
term “or” has the inclusive meaning represented by the phrase “and/or”;
(j) all
uses of currency or the symbol “$” in this Agreement refer to U.S. dollars; and
(k) where
this Agreement states that a Party “shall,” “will” or “must” perform in some manner, it means that
the Party is legally obligated to do so under this Agreement.
Article 2
Allocation of Taxes
Section 2.1 General
Rule. All Taxes shall be allocated as follows:
(a) WPC
Liability. Except with respect to Taxes described in Section 2.1(b) of this Agreement, WPC shall be liable for, and shall
indemnify and hold harmless the NLOP Group from and against any liability for:
(i) Taxes
that are allocated to WPC under this Article 2;
(ii) any
Tax resulting from a breach of any of WPC’s covenants in Section 3.3, Section 3.4, or Section 4.1 of this Agreement;
(iii) Taxes
imposed on NLOP or any member of the NLOP Group pursuant to the provisions of Treasury Regulations § 1.1502-6 (or similar provisions
of state, local, or foreign Tax Law) as a result of any such member being or having been a member of a Prior Group; and
(iv) without
duplication, any Tax or loss incurred by Mezz Borrower resulting from (x) a breach of WPC’s obligation to make the election
described in Section 1(b) of Appendix B or (y) resulting from a breach of WPC’s covenant in Section 3 of Appendix
B.
(b) NLOP
Liability. NLOP shall be liable for, and shall indemnify and hold harmless the WPC Group from and against any liability for:
(i) Taxes
that are allocated to NLOP under this Article 2; and
(ii) Any
Tax resulting from a breach of any of NLOP’s covenants in Section 3.3, Section 3.4, or Section 4.1 of this Agreement.
Section 2.2 General
Allocation Principles. All Taxes shall be allocated as follows:
(a) Allocation
of Taxes for Joint Returns. WPC shall be responsible for all Taxes reported, or required to be reported, on any Joint Return that
any member of the WPC Group files or is required to file under the Code or other applicable Tax Law.
(b) Allocation
of Taxes for Separate Returns.
(i) WPC
shall be responsible for all Taxes reported, or required to be reported, on a WPC Separate Tax Return.
(ii) NLOP
shall be responsible for all Taxes reported, or required to be reported, on a NLOP Separate Tax Return.
(c) Taxes
Not Reported on Tax Returns.
(i) WPC
shall be responsible for any Tax attributable to any member of the WPC Group that is not required to be reported on a Tax Return.
(ii) NLOP
shall be responsible for any Tax attributable to any member of the NLOP Group that is not required to be reported on a Tax Return.
Section 2.3 Allocation
Conventions. Any Tax Item of NLOP or any member of the NLOP Group arising from a transaction engaged in outside of the ordinary course
of business on the Distribution Date after the Effective Time shall be properly allocable to NLOP and any such transaction by or with
respect to NLOP or any member of the NLOP Group occurring after the Effective Time shall be treated for all Tax purposes (to the extent
permitted by applicable Tax Law) as occurring at the beginning of the day following the Distribution Date in accordance with the principles
of Treasury Regulation § 1.1502-76(b) or any similar provisions of state, local or non-U.S. Law.
Section 2.4 Transfer
Taxes. Any Transfer Taxes shall be allocated solely to NLOP.
Article 3
Tax Returns
Section 3.1 WPC
Separate Returns and Joint Returns. WPC shall prepare and file, or cause to be prepared and filed, all WPC Separate Returns and Joint
Returns, and each member of the NLOP Group to which any such Joint Return relates shall execute and file such consents, elections and
other documents as WPC may determine, after consulting with NLOP in good faith, are required or appropriate, or otherwise requested by
WPC in connection with the filing of such Joint Return. NLOP will elect and join, and will cause its respective Affiliates to elect and
join, in filing any Joint Returns that WPC determines are required to be filed or that WPC elects to file, in each case pursuant to this
Section 3.1.
Section 3.2 NLOP
Separate Tax Returns. NLOP shall prepare and file (or cause to be prepared and filed) all NLOP Separate Tax Returns and all Tax Returns
with respect to Transfer Taxes.
Section 3.3 Tax
Reporting Practices.
(a) General
Rule. Except as provided in Section 3.3(b) of this Agreement, WPC shall prepare all Joint Returns and NLOP shall prepare
all NLOP Separate Tax Returns in accordance with past practices, permissible accounting methods, elections or conventions (“Past
Practices”) used by the members of the NLOP Group and the members of the WPC Group prior to the Distribution Date. With respect
to any Tax Return that NLOP has the obligation and right to prepare, or cause to be prepared, under this Article 3, to the
extent such Tax Return could affect WPC, such Tax Return shall be prepared in accordance with Past Practices used by the members of the
WPC Group and the members of the NLOP Group prior to the Distribution with respect to such Tax Return, and to the extent any items, methods
or positions are not covered by Past Practices, such Tax Return shall be prepared in accordance with reasonable Tax accounting practices
selected by NLOP, subject to the consent of WPC (which consent may not be unreasonably withheld, conditioned or delayed).
(b) Consistency
with Intended Tax Treatment. The Parties shall (and shall cause each of their Affiliates, as applicable, to) prepare all Tax Returns
consistent with the Intended Tax Treatment unless, and then only to the extent, an alternative position is required pursuant to a determination
by a Tax Authority; provided, however, that neither Party shall be required to litigate before any court any challenge to the Intended
Tax Treatment by a Tax Authority.
(c) Tax
Elections & Statements. The Parties shall (and shall cause each of their Affiliates, as applicable, to) take all actions
necessary to effectuate the tax elections and file the statements described in Appendix B, in the form and as described in Appendix B.
Section 3.4 Adjustments.
(a) NLOP
hereby agrees that, unless as required by Law, no member of the NLOP Group (nor its successors) shall file any Adjustment Request with
respect to any Tax Return that could affect any Joint Return or any other Tax Return that could affect WPC.
(b) WPC
hereby agrees that, unless NLOP consents in writing (which consent may not be unreasonably withheld, conditioned or delayed) or as required
by Law, no member of the WPC Group shall file any Adjustment Request with respect to any NLOP Separate Return.
Section 3.5 Tax
Attributes. Tax Attributes shall not be allocated or apportioned in connection with the Distribution, and shall remain with the taxpayer
that is entitled to such Tax Attributes without regard to the Distribution.
Article 4
Tax Payments & Benefits
Section 4.1 Taxes
Shown on Tax Returns. WPC shall pay (or cause to be paid) to the proper Tax Authority the Tax shown as due on any Tax Return that
a member of the WPC Group is responsible for preparing under Article 3 of this Agreement, and NLOP shall pay (or cause to be paid)
to the proper Tax Authority the Tax shown as due on any Tax Return that a member of the NLOP Group is responsible for preparing under
Article 3 of this Agreement.
Section 4.2 Certain
Adjustments Resulting in Underpayments. Except as provided in the next sentence, in the case of any adjustment pursuant to a Final
Determination with respect to any Tax, the Party responsible for filing the Tax Return relating to such Tax pursuant to this Agreement
shall pay to the applicable Tax Authority when due any additional Tax required to be paid as a result of such adjustment. In the event
of a Tax Contest with respect to Taxes for a Pre-Distribution Period for which NLOP is responsible pursuant to Article II and for
which NLOP provides written notice to WPC prior to the end of the Coverage Period, WPC shall indemnify and hold harmless the NLOP Group
from any additional Taxes assessed or imposed in connection with such Tax Contest for a Pre-Distribution Period but only to the extent
such Taxes are described in the Coverage Limit set forth in Appendix C.
Section 4.3 Indemnification
Payments(a). To the extent that
any Party (the “Payor”) is required under applicable Tax Law to pay to a Tax Authority a Tax that another Party (the
“Required Party”) is liable for under this Agreement, the Required Party shall promptly reimburse the Payor within
twenty (20) Business Days of delivery by the Payor to the Required Party of an invoice for the amount due, accompanied by evidence of
payment and a statement detailing the Taxes paid and describing in reasonable detail the particulars relating thereto. The Required Party
shall also pay to the Payor any reasonable third-party costs and expenses related to the foregoing (including reasonable attorneys’
fees and expenses) within five (5) days after the Payor’s written demand therefor.
Section 4.4 Tax
Refunds(a). WPC shall be entitled
to any refund (and any interest thereon received from the applicable Tax Authority) of Taxes for which WPC is liable hereunder, and NLOP
shall be entitled to any refund (and any interest thereon received from the applicable Tax Authority) of Taxes for which NLOP is liable
hereunder. A Party receiving a refund to which another Party is entitled hereunder shall pay over such refund to such other Party within
thirty (30) Business Days after such refund is received or credited.
Article 5
[Reserved]
Article 6
Assistance and Cooperation
Section 6.1 Assistance
and Cooperation.
(a) The
Parties shall cooperate (and cause their respective Affiliates to cooperate) with each other and with each other’s agents, including
accounting firms and legal counsel, in connection with Tax matters relating to the Parties and their Affiliates, including (i) preparation
and filing of Tax Returns, (ii) determining the liability for and amount of any Taxes due (including estimated Taxes) or the right
to and amount of any refund of Taxes, (iii) examinations of Tax Returns, and (iv) any administrative or judicial proceeding
in respect of Taxes assessed or proposed to be assessed. Such cooperation shall include making all information and documents in their
possession relating to any other Party and its Affiliates reasonably available to such other Party as provided in this Article 6.
The Parties shall cooperate with each other and take any and all actions reasonably requested by the other in connection with obtaining
Positive Tax Opinion or Ruling (including, without limitation, by making any new representation or covenant, confirming any previously
made representation or covenant or providing any materials or information requested by any Tax Advisor).
(b) Any
information or documents provided under this Agreement shall be kept confidential by the Party receiving the information or documents,
except as may otherwise be necessary in connection with the filing of Tax Returns or in connection with any administrative or judicial
proceedings relating to Taxes. In addition, in the event that NLOP determines that the provision of any information or documents to WPC
or any of its Affiliates, or WPC determines that the provision of any information or documents to NLOP or any its Affiliates, could be
commercially detrimental, violate any Law or agreement or waive any Privilege, the Parties shall use commercially reasonable efforts
to permit each other’s compliance with its obligations under this Article 6 in a manner that avoids any such harm or consequence.
Section 6.2 Tax
Return Information. Each of NLOP and WPC, and each member of their respective Groups, acknowledges that time is of the essence in
relation to any request for information, assistance or cooperation made pursuant to Section 6.1 of this Agreement or this Section 6.2.
Each of NLOP and WPC, and each member of their respective Groups, acknowledges that failure to conform to the reasonable deadlines set
by the Party making such request could cause irreparable harm. Each Party shall provide to the other Party information and documents
relating to its Group reasonably required by the other Party to prepare Tax Returns, including any pro forma returns required by the
Responsible Party for purposes of preparing such Tax Returns. Any information or documents the Responsible Party requires to prepare
such Tax Returns shall be provided in such form as the Responsible Party reasonably requests and at or prior to the time reasonably specified
by the Responsible Party so as to enable the Responsible Party to file such Tax Returns on a timely basis.
Article 7
Tax Records
Section 7.1 Retention
of Tax Records. Each of NLOP and WPC shall preserve and keep all Tax Records exclusively relating to the assets and activities of
its Group for Pre-Distribution Periods, for so long as the contents thereof may be or become material in the administration of any matter
under the Code or other applicable Tax Law, but in any event until the later of (i) the expiration of any applicable statutes of
limitations, or (ii) seven (7) years after the filing of the Tax Return to which they relate (such later date, the “Retention
Date”). After the Retention Date, each of NLOP and WPC may dispose of such Tax Records. If, prior to the Retention Date, NLOP
or WPC reasonably determine that any Tax Records which it would otherwise be required to preserve and keep under this Article 7
are no longer material in the administration of any matter under the Code or other applicable Tax Law and the other Party agrees, then
such first Party may dispose of such Tax Records upon sixty (60) Business Days’ prior notice to the other Party. Any notice of
an intent to dispose given pursuant to this Section 7.1 shall include a list of the Tax Records to be disposed of describing in
reasonable detail each file, book, or other record accumulation being disposed. The notified Parties shall have the opportunity, at their
cost and expense, to copy or remove, within such sixty (60) Business Day period, all or any part of such Tax Records. If, at any time
prior to the Retention Date, a Party or any of its Affiliates determines to decommission or otherwise discontinue any computer program
or information technology system used to access or store any Tax Records, then such program or system may be decommissioned or discontinued
upon ninety (90) Business Days’ prior notice to the other Party and the other Party shall have the opportunity, at its cost and
expense, to copy, within such ninety (90) Business Day period, all or any part of the underlying data relating to the Tax Records accessed
by or stored on such program or system.
Section 7.2 Access
to Tax Records. The Parties and their respective Affiliates shall make available to each other for inspection and copying during
normal business hours upon reasonable notice all Tax Records (and, for the avoidance of doubt, any pertinent underlying data accessed
or stored on any computer program or information technology system) in their possession in connection with Tax matters relating to the
Parties and their Affiliates as described in Section 6.1(a), and shall permit the other Party and its Affiliates, authorized agents
and representatives and any representative of a Tax Authority or other Tax auditor direct access, at the cost and expense of the requesting
Party, during normal business hours upon reasonable notice to any computer program or information technology system used to access or
store any Tax Records, in each case to the extent reasonably required by the other Party in connection with the preparation of Tax Returns
or financial accounting statements, audits, litigation, or the resolution of items under this Agreement.
Section 7.3 Preservation
of Privilege. The Parties and their respective Affiliates shall not provide access to, copies of, or otherwise disclose to any Person
any documentation relating to Taxes existing prior to the Distribution Date to which Privilege may reasonably be asserted without the
prior written consent of the other Party, such consent not to be unreasonably withheld, conditioned or delayed.
Article 8
Tax Contests
Section 8.1 Notice.
Each Party shall provide prompt notice to the other Party of any written communication from a Tax Authority regarding any pending Tax
audit, assessment or proceeding or other Tax Contest of which it becomes aware (i) related to Taxes for Tax Periods for which it
is indemnified by the other Party hereunder or for which it may be required to indemnify the other Party hereunder, (ii) in the
case of the NLOP Group, relating to Tax Items for a Pre-Distribution Period that could affect the Taxes payable by the WPC Group, or
(iii) otherwise relating to the Intended Tax Treatment. Such notice shall attach copies of the pertinent portion of any written
communication from a Tax Authority and contain factual information (to the extent known) describing any asserted Tax liability in reasonable
detail and shall be accompanied by copies of any notice and other documents received from any Tax Authority in respect of any such matters.
Section 8.2 Control
of Tax Contests.
(a) WPC
Control. Notwithstanding anything in this Agreement to the contrary, WPC shall have the sole right to control and absolute discretion
with respect to any decisions to be made, or the nature of any action to be taken, with respect to any Tax Contest with respect to any
Tax matters relating to (i) a Joint Return, (ii) a WPC Separate Tax Return, or (iii) a Tax for which WPC is or may be
required to indemnify NLOP; provided, however, that with respect to Tax Contests involving NLOP Separate Tax Returns described in clause
(iii), WPC shall not settle any such Tax Contest without NLOP’s prior written consent (which may not be unreasonably withheld,
conditioned or delayed).
(b) NLOP
Control. Except as otherwise provided in this Section 8.2, NLOP shall have the sole right to control any Tax Contest with respect
to any Tax matters relating to a NLOP Separate Tax Return or Transfer Taxes.
(c) Except
as otherwise provided in Section 8.2(a), in connection with any Tax Contest described in this Section 8.2, the Controlling
Party shall have the sole right to contest, litigate, compromise and settle any Tax Contest; provided that to the extent any such Tax
Contest (i) could give rise to a claim for indemnity by the Controlling Party or its Affiliates against the Non-Controlling Party
or its Affiliates under this Agreement, (ii) is with respect to a NLOP Group Tax Return for a Pre-Distribution Period, or (iii) is
with respect to a NLOP Group Tax Return and involves a challenge to the Intended Tax Treatment, then the Controlling Party shall not
settle any such Tax Contest without the Non-Controlling Party’s prior written consent (which may not be unreasonably withheld,
conditioned or delayed). In connection with any potential adjustment in a Tax Contest described in clauses (i)-(iii) of the preceding
sentence: (i) the Controlling Party shall keep the Non-Controlling Party informed in a timely manner of all actions taken or proposed
to be taken by the Controlling Party with respect to such Tax Contest; (ii) the Controlling Party shall timely provide the Non-Controlling
Party copies of any written materials relating to such potential adjustment in such Tax Contest received from any Tax Authority; (iii) the
Controlling Party shall timely provide the Non-Controlling Party with copies of any correspondence or filings submitted to any Tax Authority
or judicial authority in connection with such potential adjustment in such Tax Contest; (iv) the Controlling Party shall consult
with the Non-Controlling Party and offer the Non-Controlling Party a reasonable opportunity to comment before submitting any written
materials prepared or furnished in connection with such potential adjustment in such Tax Contest; and (v) the Controlling Party
shall defend such Tax Contest diligently and in good faith; provided, however, that if NLOP is the Controlling Party, (y) WPC shall
have the right to participate in the relevant Tax Contest, and (z) NLOP shall not take any action that may negatively impact any
Tax Return or Tax liability of WPC without WPC’s prior written consent (which consent may not be unreasonably withheld, conditioned
or delayed). The failure of the Controlling Party to take any action specified in the preceding sentence with respect to the Non-Controlling
Party shall not relieve the Non-Controlling Party of any liability and/or obligation which it may have to the Controlling Party under
this Agreement except to the extent that the Non-Controlling Party was actually harmed by such failure, and in no event shall such failure
relieve the Non-Controlling Party from any other liability or obligation which it may have to the Controlling Party. In the case of any
Tax Contest described in this Article 8, “Controlling Party” means the Party entitled to control the Tax Contest under
such Section 8.2(a) or Section 8.2(b) and “Non-Controlling Party” means (x) WPC if NLOP is the Controlling
Party and (y) NLOP if WPC is the Controlling Party.
(d) Power
of Attorney. Each member of the WPC Group shall execute and deliver to NLOP (or such member of the NLOP Group as NLOP shall designate)
any power of attorney or other similar document reasonably requested by NLOP (or such designee) in connection with any Tax Contest (as
to which NLOP is the Controlling Party) described in this Article 8. Each member of the NLOP Group shall execute and deliver to
WPC (or such member of the WPC Group as WPC shall designate) any power of attorney or other similar document requested by WPC (or such
designee) in connection with any Tax Contest (as to which WPC is the Controlling Party) described in this Article 8.
Article 9
Tax Treatment of Payments
Unless WPC determines, in its reasonable discretion,
that an alternative characterization is appropriate, any payment made by WPC or any member of the WPC Group to NLOP or any member of
the NLOP Group, or by NLOP or any member of the NLOP Group to WPC or any member of the WPC Group, pursuant to this Agreement shall be
treated by the Parties for all Tax purposes as a distribution by NLOP to WPC, or a capital contribution from WPC to NLOP, as the case
may be, occurring immediately before the Distribution; provided, however, that any such payment that is made or received by a Person
other than WPC or NLOP, as the case may be, shall be treated as if made or received by the payor or the recipient as agent for WPC or
NLOP, in each case as appropriate and as reasonable determined by WPC. No Party shall take any position inconsistent with the treatment
described in the preceding sentence (including any alternative treatment determined by WPC), and in the event that a Tax Authority asserts
that a Party’s treatment of a payment pursuant to this Agreement should be other than as set forth in the preceding sentence, such
Party shall use its commercially reasonable efforts to contest such challenge.
Article 10
Indemnification Payment Escrow
Notwithstanding anything to the contrary in this
Agreement, the Separation and Distribution Agreement or any Ancillary Agreement, if one party to this Agreement, the Separation and Distribution
Agreement or any Ancillary Agreement (the “Indemnification Payor”) is required to pay another party to such agreement
(the “Indemnification Payee”) any indemnification payment that could reasonably result in income to any Protected
REIT for U.S. federal income Tax purposes if paid (such payment, an “Indemnification Payment”), then, unless the Indemnification
Payee shall have received a tax opinion of a Tax Advisor or a ruling from the IRS to the effect that the Indemnification Payee’s
receipt of such payment will be treated as qualifying income with respect to the any applicable Protected REIT for purposes of Section 856(c)(2) and
856(c)(3) of the Code (“Qualifying Income”) or shall be excluded from income for such purposes (such advice or
ruling, a “Positive Tax Opinion or Ruling”), and notified the Indemnification Payor in writing of its receipt of such
Positive Tax Opinion or Ruling and directed that payment be made otherwise than into escrow as provided below, the amounts payable to
the Indemnification Payee shall be limited to the maximum amount (“Allowed Amount”) that can be paid without causing
the Indemnification Payee’s receipt of its share of such funds to cause any applicable Protected REIT to fail to meet the requirements
of Sections 856(c)(2) and (3) of the Code, determined as if the payment of such amount did not constitute Qualifying Income
and the Protected REIT has 0.5% of income from unknown sources during such year that does not constitute Qualifying Income (in addition
to any known or anticipated income that is not Qualifying Income), as determined by independent accountants to the Indemnification Payee,
and any excess of the amount of the Indemnification Payment over the Allowed Amount (such excess, the “Escrowed Amount”)
shall be placed into escrow. Any such Escrowed Amount shall be retained by the escrow agent in a separate interest-bearing, segregated
account for the account of the Indemnification Payor. The Indemnification Payee shall pay all costs associated with obtaining any tax
opinion of a Tax Advisor or ruling from the IRS described above. The Escrowed Amount shall be fully disbursed (and therefore any unpaid
portion of the Indemnification Payment shall be paid to the Indemnification Payee) upon the escrow agent’s receipt of a Positive
Tax Opinion or Ruling. To the extent not previously paid, upon any determination by independent accountants to the Indemnification Payee
that any additional amount of the Indemnification Payment may be disbursed to the Indemnification Payee without causing any applicable
Protected REIT to fail to meet the requirements of Sections 856(c)(2) and 856(c)(3) of the Code, determined as if the payment
of such amount did not constitute Qualifying Income and the Protected REIT has 0.5% of income from unknown sources during such year that
does not constitute Qualifying Income (in addition to any known or anticipated income that is not Qualifying Income), the determination
of such independent accountants shall be provided to the escrow agent and such additional amount shall be disbursed to the Indemnification
Payee. At the end of the second calendar year beginning after the date on which the Indemnification Payor’s obligation to pay the
Indemnification Payment arose (or earlier if directed by the Indemnification Payee), any remainder of the Escrowed Amount (together with
interest thereon) then being held by the escrow agent shall be disbursed to the Indemnification Payor and, in the event that the Indemnification
Payment has not by then been paid in full, such unpaid portion shall never be due.
Article 11
General Provisions
Section 11.1 Amendments
and Waivers.
(a) Subject
to Section 11.1 of the Separation and Distribution Agreement, this Agreement may not be amended except by an agreement in writing
signed by both Parties.
(b) Any
term or provision of this Agreement may be waived, or the time for its performance may be extended, by the Party entitled to the benefit
thereof and any such waiver shall be validly and sufficiently given for the purposes of this Agreement if it is in writing signed by
an authorized representative of such Party. No delay or failure in exercising any right, power or remedy hereunder shall affect or operate
as a waiver thereof; nor shall any single or partial exercise thereof or any abandonment or discontinuance of steps to enforce such a
right, power or remedy preclude any further exercise thereof or of any other right, power or remedy. The rights and remedies hereunder
are cumulative and not exclusive of any rights or remedies that either Party would otherwise have.
Section 11.2 Survival
of Obligations. The representations, warranties, covenants and agreements set forth in this Agreement shall be unconditional and
absolute and shall remain in effect without limitation as to time.
Section 11.3 Dispute
Resolution. Any and all Agreement Disputes arising hereunder shall be resolved through the procedures provided in Article X
of the Separation and Distribution Agreement.
Section 11.4 Notices.
All notices, requests, permissions, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly
given (a) five (5) Business Days following sending by registered or certified mail, postage prepaid, (b) when sent, if
sent by facsimile, (c) when delivered, if delivered personally to the intended recipient, and (d) one (1) Business Day
following sending by overnight delivery via a national courier service and, in each case, addressed to a Party at the following address
for such Party:
(a) if
to WPC to:
One Manhattan West
395 9th Avenue
58th Floor
New York, NY 10001
Attn: Sapna Sanagavarapu, Chief Legal Officer
email: ssanagavarapu@WPCAREY.COM
with a copy (which shall not constitute notice) to:
Hogan
Lovells US LLP
555 13th Street NW
Washington, DC 20004
Attn: Lauren Clarke
email: lauren.clarke@hoganlovells.com
(b) if
to NLOP to:
One Manhattan West
395 9th Avenue
58th Floor
New York, NY 10001
Attn: Sapna Sanagavarapu, Chief Legal Officer
email: ssanagavarapu@WPCAREY.COM
with a copy (which shall not constitute notice) to:
Hogan Lovells US LLP
555 13th Street NW
Washington, DC 20004
Attn: Lauren Clarke
email: lauren.clarke@hoganlovells.com
All notices, requests, claims, consents, demands
and other communications under this Agreement shall be deemed duly given or made (A) if delivered in person, on the date delivered,
(B) if sent by electronic mail (providing confirmation of transmission), on the date it was received, or (C) if sent by prepaid
overnight courier, on the next Business Day (providing proof of delivery). For the avoidance of doubt, counsel for a Party may send notices,
requests, claims, consents demands or other communications on behalf of such Party.
Section 11.5 Severability.
If any term or other provision of this Agreement is determined by a nonappealable decision by a court, administrative agency or arbitrator
to be invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of
this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the Restructuring Transactions
and Distribution is not affected in any manner materially adverse to either Party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the court, administrative agency or arbitrator shall interpret this Agreement so
as to affect the original intent of the Parties as closely as possible in an acceptable manner to the end that the Restructuring Transactions
and Distribution are fulfilled to the fullest extent possible. If any sentence in this Agreement is so broad as to be unenforceable,
the provision shall be interpreted to be only as broad as is enforceable.
Section 11.6 Counterparts
. This Agreement may be executed in counterparts,
each of which shall be deemed an original and all of which together shall be deemed one and the same agreement, and shall become effective
when one or more counterparts have been signed by each of the Parties and delivered to the other Parties. Signatures to this Agreement
transmitted by electronic mail in .pdf format, or by any other electronic means intended to preserve the original graphic and pictorial
appearance of a document, will have the same effect as physical delivery of the paper document bearing the original signature.
Section 11.7 Entire
Agreement; No Third-Party Beneficiaries. This Agreement constitutes the entire agreement and understanding between the Parties with
respect to the subject matter hereof and supersede all prior negotiations, agreements, commitments, writings, courses of dealing and
understandings with respect to the subject matter hereof. This Agreement is solely for the benefit of the Parties and should not be deemed
to confer upon third parties any remedy, claim, liability, reimbursement, cause of action or other right in excess of those existing
without reference to this Agreement.
Section 11.8 Governing
Law. This Agreement shall be governed by, and construed and enforced in accordance with, the substantive laws of the State of New
York, without regard to any conflicts of law provisions thereof that would result in the application of the laws of any other jurisdiction.
Section 11.9 Assignment;
Binding Effect. This Agreement shall be binding upon and inure to the benefit of the Parties and their successors and permitted assigns;
provided, however, that the rights and obligations of each Party under this Agreement shall not be assignable, in whole or in part, directly
or indirectly, whether by operation of law or otherwise, by such Party without the prior written consent of the other Party (such consent
not to be unreasonably withheld, conditioned or delayed) and any attempt to assign any rights or obligations under this Agreement without
such consent shall be null and void. Notwithstanding the foregoing, either Party may assign its rights and obligations under this Agreement
to any of their respective Affiliates provided that no such assignment shall release such assigning Party from any liability or obligation
under this Agreement.
Section 11.10 Remedies.
(a) Except
as otherwise provided in this Agreement, any and all remedies herein expressly conferred upon a Party will be deemed cumulative with
and not exclusive of any other remedy conferred hereby, or by Law or equity upon such Party, and the exercise by a Party of any one remedy
will not preclude the exercise of any other remedy.
(b) The
Parties agree that irreparable damage would occur if any of the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached, and that monetary damages, even if available, would not be an adequate remedy therefor. It
is accordingly agreed that prior to the termination of this Agreement, the non-breaching Party shall be entitled to seek an injunction
or injunctions, specific performance or other equitable relief to prevent breaches of this Agreement and to enforce specifically the
terms and provisions of this Agreement without proof of damages or otherwise, in addition to any other remedy to which such Party is
entitled at Law or in equity. Each of the Parties hereby waives (a) any defense in an Action for specific performance that a remedy
at law would be adequate to prevent or restrain breaches or threatened breaches and (b) any requirement under any Law to post a
security as a prerequisite to obtaining equitable relief. Each Party agrees that the right of specific performance and other equitable
relief is an integral part of the transactions contemplated by this Agreement and without that right neither NLOP, on the one hand, nor
WPC, on the other hand, would have entered into this Agreement. For the avoidance of doubt, the Parties may pursue both a grant of specific
performance or other equitable remedies to the extent permitted by this Section 11.10 and the payment of damages, but shall not
be entitled or permitted to receive an award of damages if specific performance or other equitable remedies are awarded and shall not
be entitled or permitted to receive an award of specific performance or other equitable remedies if damages are awarded.
Section 11.11 Waiver
of Jury Trial.
EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION OR OTHER PROCEEDING
(WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY (A) CERTIFIES
THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH PARTY WOULD NOT, IN THE EVENT OF ANY
ACTION, SUIT OR PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT, BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS Section 11.11.
Section 11.12 Authorship.
The Parties agree that the terms and language of this Agreement are the result of negotiations among the Parties and their respective
advisors and, as a result, there shall be no presumption that any ambiguities in this Agreement shall be resolved against any Party.
Any controversy over construction of this Agreement shall be decided without regard to events of authorship or negotiation.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Parties
have caused this Agreement to be executed and delivered by their respective duly authorized officers, all as of the date first written
above.
|
W. P. CAREY INC. |
|
|
|
By: |
/s/ ToniAnn Sanzone |
|
|
Name: |
ToniAnn Sanzone |
|
|
Title: |
Chief Financial Officer |
|
|
|
NET LEASE OFFICE PROPERTIES |
|
|
|
By: |
/s/ Jason E. Fox |
|
|
Name: |
Jason E. Fox |
|
|
Title: |
Chief Executive Officer |
|
|
|
With respect to Section 2.1(a)(iv) and
Sections 1(b) and 3 of Appendix B: |
|
|
|
NLO MEZZANINE BORROWER LLC |
|
|
|
By: |
/s/ ToniAnn Sanzone |
|
|
Name: |
ToniAnn Sanzone |
|
|
Title: |
Chief Financial Officer |
[Signature Page to Tax Matters Agreement]
Exhibit 10.3
ADVISORY AGREEMENT
dated as of November 1, 2023
between
Net
Lease Office Properties
and
W. P.
Carey Management LLC
TABLE OF CONTENTS
|
Page |
|
|
SECTION 1. DEFINITIONS |
1 |
SECTION 2. APPOINTMENT AND DUTIES OF THE ADVISOR |
5 |
SECTION 3. OTHER ACTIVITIES OF THE ADVISOR |
9 |
SECTION 4. AGENCY |
10 |
SECTION 5. BANK ACCOUNTS |
10 |
SECTION 6. RECORDS |
10 |
SECTION 7. CONFIDENTIALITY |
10 |
SECTION 8. LIMITATION ON ACTIVITIES; INSURANCE |
10 |
SECTION 9. COMPENSATION |
11 |
SECTION 10. EXPENSES |
12 |
SECTION 11. LIMITATION OF LIABILITY; INDEMNIFICATION |
14 |
SECTION 12. NO JOINT VENTURE |
15 |
SECTION 13. TERM |
16 |
SECTION 14. TERMINATION |
16 |
SECTION 15. TERMINATION FEE |
16 |
SECTION 16. ACTION UPON TERMINATION |
17 |
SECTION 17. ASSIGNMENT |
17 |
SECTION 18. RELEASE OF PROPERTY |
18 |
SECTION 19. NOTICES |
18 |
SECTION 20. SUCCESSORS AND ASSIGNS |
19 |
SECTION 21. ENTIRE AGREEMENT |
19 |
SECTION 22. Arbitration |
19 |
SECTION 23. GOVERNING LAW |
21 |
SECTION 24. NO WAIVERS |
21 |
SECTION 25. HEADINGS |
21 |
SECTION 26. EXECUTION IN COUNTERPARTS |
21 |
SECTION 27. SURVIVAL |
22 |
SECTION 28. Severability |
22 |
|
|
Annex
A: NLOP Properties |
|
ADVISORY AGREEMENT
THIS ADVISORY AGREEMENT (this
“Agreement”) is made as of November 1, 2023 (the “Effective Date”) by and between Net Lease
Office Properties, a Maryland real estate investment trust (the “Company”), and W. P. Carey Management LLC, a
Delaware limited liability company (together with its permitted assignees, the “Advisor”).
W
I T N E S S E T H:
WHEREAS, the Company, through
its own operations and the operations of its Subsidiaries (as defined herein), is in the business of owning, developing, managing and
disposing of office real property;
WHEREAS, the Company intends
to qualify as a Real Estate Investment Trust (a “REIT”) under the Code (as defined herein);
WHEREAS, the Company desires
to avail itself of the experience, sources of information, advice, assistance and certain facilities of, or 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 Trustees of, the Company, as provided in this Agreement;
WHEREAS, the Company and the
European Advisor have, concurrently with the execution of this Agreement, entered into that the European Advisory Agreement; and
WHEREAS, the Advisor is willing
to render such services on the terms and conditions hereinafter set forth.
NOW THEREFORE, in consideration
of the mutual agreements herein set forth, the parties hereto agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement,
the following terms have the definitions hereinafter indicated:
“AAA” has
the meaning set forth in Section 22(a) of this Agreement.
“Administrative
Reimbursement” has the meaning set forth in Section 10(a) of this Agreement.
“Advisor”
has the meaning set forth in the preamble to this Agreement.
“Advisor Costs”
has the meaning set forth in Section 10(c) of this Agreement.
“Advisor Indemnified
Party” has the meaning set forth in Section 11(b) of this Agreement.
“Affiliate”
means, with respect to any Person, (i) any other Person directly or indirectly controlling, controlled by, or under common
control with such Person, (ii) any executive officer, general partner or managing member of such Person, (iii) any member of
the board of directors or board of managers (or bodies performing similar functions) of such Person and (iv) any legal entity for
which such Person acts as an executive officer, general partner or managing member. For the avoidance of doubt, and for purposes of this
Agreement, the Company shall not be considered an Affiliate of the Advisor.
“Agreement”
means this Advisory Agreement, as amended from time to time.
“Appellate Rules”
has the meaning set forth in Section 22(g) of this Agreement.
“Applicable Percentage”
shall mean, with respect to any NLOP Property, the percentage set forth on Annex A hereto with respect to such NLOP Property.
“Applicable Disposition
Discount” means, with respect to any NLOP Property, the dollar amount equal to product of (a) the Applicable Percentage,
and (b) the Base Management Fee.
“Audit Committee”
means the audit committee of the Board of Trustees or the committee or body performing similar functions.
“Award”
has the meaning set forth in Section 22(e) of this Agreement.
“Base Management
Fee” has the meaning set forth in Section 9(a) of this Agreement.
“Board of Trustees”
means the board of trustees of the Company.
“Cause”
means the occurrence of any of the following events:
(a) any
material breach of a material term of this Agreement by the Advisor that has not been cured within 30 days following written notice thereof
from the Company;
(b) fraud,
criminal conduct, willful misconduct or willful or grossly negligent breach by the Advisor in the performance of its duties under this
Agreement that, in each case, is determined by a majority of the Company’s Independent Trustees to be materially adverse to the
Company;
(c) the
commencement of any proceeding relating to the Advisor’s bankruptcy or insolvency, or the dissolution of the Advisor, including
an order for relief in an involuntary bankruptcy case or the Advisor authorizing or filing a voluntary bankruptcy petition; or
(d) termination
of the European Advisory Agreement by the Company for “Cause” (as defined in the European Advisory Agreement) pursuant to
subsections (a), (b) or (c) of the definition thereof.
“Change in Control”
means the occurrence of any of the following events:
(a) a
transaction or series of transactions whereby any “person” or related “group” of “persons” (as such
terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) (other than the Company or any Subsidiary of the Company)
directly or indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of securities of the
Company possessing more than fifty percent (50%) of the total combined voting power of the Company’s securities outstanding immediately
after such acquisition; provided, however, that no person or group shall be treated for purposes of this clause (b)(ii) as beneficially
owning fifty percent (50%) or more of the combined voting power of the Company solely as a result of the voting power held in the Company
prior to the consummation of the transaction;
(b) during
any period of two (2) consecutive years, individuals who, at the beginning of such period, constitute the Board of Trustees together
with any new trustee(s) (other than a trustee designated by a person who shall have entered into an agreement with the Company to
effect a transaction described in the preceding clause (i) or the succeeding clause (iii) of this definition) whose election
by the Board of Trustees or nomination for election by the Company’s shareholders was approved by a vote of at least two-thirds
(2/3) of the trustees then still in office who either were trustees at the beginning of the two (2)-year period or whose election or nomination
for election was previously so approved, cease for any reason to constitute a majority thereof; or
(c) the
consummation by the Company (whether directly involving the Company or indirectly involving the Company through one or more intermediaries)
of (A) a merger, consolidation, reorganization, or business combination, (B) a sale or other disposition of all or substantially
all of the Company’s assets in any single transaction or series of related transactions or (C) the acquisition of all or substantially
all of the assets or stock of another entity, in each case, other than a transaction:
(i) which
results in the Company’s voting securities outstanding immediately before the transaction continuing to represent (either by remaining
outstanding or by being converted into voting securities of the Company or the person that, as a result of the transaction, controls,
directly or indirectly, the Company or owns, directly or indirectly, all or substantially all of the Company’s assets or otherwise
succeeds to the business of the Company (the Company or such person, the “Successor Entity”)) directly or indirectly,
at least a majority of the combined voting power of the Successor Entity’s outstanding voting securities immediately after the transaction,
and following which the Successor Entity continues to own all or substantially all the assets that the Company owned immediately before
the transaction and succeeds to its business, and
(ii) after
which no person or group beneficially owns voting securities representing more than fifty percent (50%) of the combined voting power of
the Successor Entity; provided, however, that no person or group shall be treated for purposes of this clause (b)(ii) as beneficially
owning fifty percent (50%) or more of the combined voting power of the Successor Entity solely as a result of the voting power held in
the Company prior to the consummation of the transaction; or
(d) approval
by the Company’s shareholders of a liquidation or dissolution of the Company.
“Code”
means the Internal Revenue Code of 1986, as amended.
“Common Share”
means a common share of beneficial interest, par value $0.001 per share, of the Company now or hereafter authorized as common voting shares
of the Company.
“Company”
has the meaning set forth in the preamble to this Agreement.
“Company Account”
has the meaning set forth in Section 5 of this Agreement.
“Company Indemnified
Party” has the meaning set forth in Section 11(c) of this Agreement.
“Company Termination
for Convenience” has the meaning set forth in Section 14(b) of this Agreement.
“Cross Default Termination”
has the meaning set forth in Section 14(d) of this Agreement.
“Disposed
Property” has the meaning set forth in Section 9(c) of this Agreement.
“Disputes”
has the meaning set forth in Section 22(a) of this Agreement.
“Effective Date”
has the meaning set forth in the preamble to this Agreement.
“European Advisor”
means W. P. Carey & Co. B.V., a wholly owned subsidiary of WPC.
“European Advisory
Agreement” means that certain European Advisory Agreement entered into by and between the Company and the European Advisor concurrently
with this Agreement, as such agreement may be modified or amended from time to time in accordance with its terms.
“Exchange Act”
means the Securities Exchange Act of 1934, as amended.
“Expenses”
has the meaning set forth in Section 10(d) of this Agreement.
“Good Reason”
means the occurrence of any of the following events:
(a) any
failure to obtain a reasonably satisfactory agreement from any successor to the Company to assume the Company’s obligations under
the Agreement;
(b) any
material breach of this Agreement by the Company that has not been cured within 30 days following written notice thereof from the Advisor;
or
(c) the
Advisor has the right to terminate the European Advisory Agreement with “Good Reason” (as defined in the European Advisory
Agreement) pursuant to subsection (a) or (b) of the definition thereof.
“Governing Instruments”
means, with regard to any entity, the declaration of trust and bylaws in the case of a real estate investment trust, the articles of incorporation
and bylaws in the case of a corporation, the certificate of limited partnership (if applicable) and the partnership agreement in the case
of a general or limited partnership, the articles of formation and the operating agreement in the case of a limited liability company,
or, in each case, comparable governing documents.
“Indemnified Party”
has the meaning set forth in Section 11(d) of this Agreement.
“Independent Trustee”
means any member of the Board of Trustees who, on the date at issue, is “independent” as determined by application of the
rules and regulations of any applicable securities exchange on which the Common Shares are listed.
“Initial Term”
has the meaning set forth in Section 13 of this Agreement.
“Investment Company
Act” means the Investment Company Act of 1940, as amended.
“Losses”
has the meaning set forth in Section 11(b) of this Agreement.
“Management Fee”
has the meaning set forth in Section 9(a) of this Agreement.
“NLOP Properties”
means the real properties of the Company or its Subsidiaries listed in Annex A hereto.
“Person”
means any natural person, corporation, partnership, association, limited liability company, estate, trust, joint venture, any federal,
state, county or municipal government or any bureau, department or agency thereof or any other legal entity and any fiduciary acting in
such capacity on behalf of the foregoing.
“REIT”
has the meaning set forth in the recitals to this Agreement”
“Renewal Term”
has the meaning set forth in Section 13 of this Agreement.
“Required Approval”
has the meaning set forth in Section 2(d) of this Agreement:
“Rules”
has the meaning set forth in Section 22(a) of this Agreement.
“SEC” means
the U.S. Securities and Exchange Commission.
“Securities Act”
means the Securities Act of 1933, as amended.
“Subsidiary”
means any subsidiary of the Company and any partnership, the general partner of which is the Company or any subsidiary of the Company
and any limited liability company, the managing member of which is the Company or any subsidiary of the Company.
“Term”
has the meaning set forth in Section 13 of this Agreement.
“Termination Date”
means the effective date of any termination pursuant to Section 14.
“Termination Fee”
has the meaning set forth in Section 15(a) of this Agreement.
“Trailing Annual
Fees” has the meaning set forth in Section 15 of this Agreement.
“Trustee”
means any person holding such office on the Board of Trustees, as of any particular time.
“Qualified Disposition”
means, for any NLOP Property, the sale, transfer or other disposition of all of the Company’s direct or indirect interest in and
title to such NLOP Property to a third party other than the Company or any of its direct or indirect Subsidiaries.
“Qualifying Termination”
means the occurrence of any of the following events:
(a) Company
Termination for Convenience;
(b) Termination
by the Advisor with Good Reason; or
(c) Cross
Default Termination by the Advisor if the European Advisory Agreement is terminated pursuant to (i) a “Company Termination
for Convenience” or (ii) a termination by the Advisor with “Good Reason” (each as defined in the European Advisory
Agreement).
“Reimbursable Expenses”
has the meaning set forth in Section 10(e) of this Agreement.
“WPC” means
W. P. Carey Inc., a Maryland corporation, of which the Advisor is a wholly owned subsidiary.
SECTION 2. APPOINTMENT AND DUTIES OF THE
ADVISOR
(a) The
Company hereby appoints the Advisor to provide management services with respect to the day-to-day operations of the Company and the NLOP
Properties, including strategic management services, asset management, property disposition support, and various related services, and
the Advisor hereby agrees to use its commercially reasonable efforts to perform each of the duties set forth herein. The appointment of
the Advisor shall be exclusive to the Advisor, except to the extent that the Advisor elects, pursuant to the terms and conditions of this
Agreement, to cause the duties of the Advisor hereunder to be provided by third parties.
(b) The
Advisor, in its capacity as such, shall at all times be subject to the supervision, direction and management of the Board of Trustees,
and will have only such functions and authority as the Company may delegate to it and as set forth in this Agreement. The Board of Trustee
has dispositive power in the event of any conflict between the Board of Trustees and the Advisor with respect to the functions and authority
delegated to the Advisor above.
(c) The
Company and the Board of Trustees, subject to the limitations set forth in Section 2(d), hereby delegates the following functions
and authority to the Advisor, and the Advisor agrees to perform (or cause to be performed) such services and activities relating to the
NLOP Properties and operations of the Company as may be appropriate, including, without limitation:
(i) sourcing,
investigating and evaluating prospective disposition, exchange or other transactions with respect to the NLOP Properties (including potential
seller financing related thereto, as may be permitted), and making recommendations with respect thereto to the Board of Trustees, where
applicable;
(ii) conducting
negotiations with brokers, purchasers and their respective agents and representatives, investment bankers and other parties regarding
the disposition, exchange or other transactions with respect to the NLOP Properties (including potential seller financing related thereto,
as may be permitted), and subject to any necessary approvals from the Board of Trustees, executing and delivering documentation related
thereto and performing the transactions contemplated thereby;
(iii) managing
and monitoring the operating performance of NLOP Properties and providing periodic reports to the Board of Trustees, in form, substance
and frequency as the Advisor deems reasonably necessary or as the Board of Trustees may otherwise reasonably request;
(iv) assisting
the Company in developing criteria that are specifically tailored to the Company’s operations and divestiture objectives;
(v) engaging
and supervising independent contractors that provide services relating to the Company or the NLOP Properties, including, but not limited
to, investment banking, legal, regulatory, tax, accounting, securities brokerage, property management, real estate, leasing, brokerage
and other advisory and consulting services reasonably necessary for Advisor to perform its duties hereunder (it being understood that
the Independent Trustees and any committees of the Board of Trustees shall retain the authority to hire its or their own attorneys or
other advisors);
(vi) negotiating,
on behalf of the Company, the terms of loan documents for the Company’s financings;
(vii) coordinating
and managing the operations of any joint venture or co-investment interests held by the Company and conducting and overseeing all matters
with respect to the joint venture or co-investment partners;
(viii) coordinating
and supervising all property managers, tenant operators, leasing agents and developers for the administration, leasing, management and/or
development of any of the NLOP Properties;
(ix) providing
executive and administrative personnel, office space and administrative services required in rendering services to the Company;
(x) administering
bookkeeping and accounting functions as are required for the management and operation of the Company, contracting for audits and preparing
such periodic reports and filings as may be required by any governmental authority in connection with the ordinary conduct of the Company’s
business, and otherwise advising and assisting the Company with its compliance with applicable legal and regulatory requirements, including,
without limitation, periodic reports, returns or statements required under the Exchange Act, the Code and any regulations or rulings thereunder,
the securities and tax statutes of any jurisdiction in which the Company is obligated to file such reports, or the rules and regulations
promulgated under any of the foregoing;
(xi) advising
and assisting in the preparation and filing of all offering documents, registration statements, prospectuses, proxies and other forms
or documents filed with the SEC pursuant to the Securities Act or any state securities regulators (it being understood that the Company
shall be responsible for the content of any and all of its offering documents, SEC filings or state regulatory filings, and that the Advisor
shall not be held liable for any costs or liabilities arising out of any misstatements or omissions in the Company’s offering documents,
SEC filings, state regulatory filings or other filings referred to in this subparagraph, whether or not material (except by reason of
acts constituting bad faith, willful misconduct, gross negligence or reckless disregard of the Advisor’s duties under this Agreement);
(xii) enabling
the Company to retain qualified accountants and legal counsel, as applicable, to assist in developing appropriate accounting procedures,
compliance procedures and testing systems with respect to financial reporting obligations and compliance with the provisions of the Code
applicable to REITs (it being understood that the Board of Trustees and its Audit Committee shall retain authority to determine the Company’s
independent public accountant and that the Independent Trustees and any committees of the Board of Trustees shall retain the authority
to hire its or their own attorneys or other advisors);
(xiii) counseling
the Company regarding the maintenance of its status as a REIT and monitoring compliance with the various REIT qualification tests and
other rules set out in the Code and Treasury Regulations thereunder;
(xiv) counseling
the Company regarding the maintenance of its exemption from the Investment Company Act and monitoring compliance with the requirements
for maintaining an exemption from the Investment Company Act;
(xv) counseling
the Company in connection with policy decisions to be made by the Board of Trustees;
(xvi) evaluating
and recommending to the Board of Trustees modifications to any hedging strategies in effect on the date hereof and engaging in hedging
activities;
(xvii) communicating
with the Company’s investors and analysts as required to satisfy reporting or other requirements of any governing body or exchange
on which the Company’s securities are traded and to maintain effective relations with such parties;
(xviii) investing
and re-investing any moneys and securities of the Company (including investing in short-term investments, payment of fees, costs and expenses,
or payments of dividends or distributions to shareholders and partners of the Company) and advising the Company as to its capital structure
and capital raising;
(xix) causing
the Company to qualify to do business in all applicable jurisdictions and to obtain and maintain all appropriate licenses;
(xx) handling
and resolving all claims, disputes or controversies (including all litigation, arbitration, settlement or other proceedings or negotiations)
in which the Company may be involved or to which the Company may be subject arising out of the Company’s day-to-day operations,
subject to such limitations or parameters as may be imposed from time to time by the Board of Trustees;
(xxi) using
commercially reasonable efforts to enable expenses incurred by or on behalf of the Company to be within any expense guidelines or budgets
set by the Board of Trustees from time to time;
(xxii) using
commercially reasonable efforts to enable the Company to comply with all applicable laws and regulations in all material respects; and
(xxiii) performing
such other services as may be required from time to time for management and other activities relating to the assets of the Company as
the Board of Trustees and the Advisor shall agree from time to time.
Without limiting the foregoing,
the Advisor will also perform portfolio management services on behalf of the Company with respect to the NLOP Properties. Such services
will include, but not be limited to, consulting with the Company on the purchase and sale of, and other investment opportunities in connection
with, the Company’s portfolio of assets; the collection of information and the submission of reports pertaining to the Company’s
assets, interest rates and general economic conditions; periodic review and evaluation of the performance of the Company’s portfolio
of assets; acting as liaison between the Company and banking, mortgage banking, investment banking and other parties with respect to the
purchase, financing and disposition of assets; and other customary functions related to portfolio management. Additionally, the Advisor
will perform monitoring services on behalf of the Company with respect to any services provided by third parties, which the Advisor determines
are material to the performance of the business.
(d) Notwithstanding
anything to the contrary in this Agreement, the Advisor must obtain prior approval by a majority of the Board of Trustees (including a
majority of the Independent Trustees and a majority of the members of the Board of Trustees not involved in the applicable transaction)
(the “Required Approval”) prior to causing the Company to take any of the following actions (subject to any delegation
for which the Required Approval was obtained with respect thereto):
(i) the
entry into, or termination or material modification of, any material transaction related to any NLOP Property, including dispositions
and joint ventures;
(ii) the
entry into, or termination or material modification of, any material financing, loan or securities offering transaction of the Company
or its Subsidiaries;
(iii) the
retention of the Company’s independent registered public accountants (which shall also require the prior approval of the Audit Committee
of the Board of Trustees);
(iv) the
entry into, or termination or modification of, any material transaction between the Company, on the one hand, and the Advisor or its Affiliates,
on the other hand;
(v) the
issuance, optional redemption or repurchase of equity or debt securities by the Company or any of its Subsidiaries;
(vi) the
grant, termination or material modification of any equity incentive awards by the Company or any of its Subsidiaries;
(vii) the
entry into, or termination or material modification of any transaction that would constitute a Change in Control; and
(viii) such
other matters as may be determined by the Board of Trustees from time to time.
(e) The
Advisor shall make available sufficient experienced and appropriate personnel to perform the services and functions specified herein,
including, without limitation, a chief executive officer, chief financial officer, the positions required under the Governing Instruments
of the Company and its Subsidiaries and such other positions as the Advisor deems reasonably necessary from time to time. The Advisor
shall not be obligated to dedicate any of its officers or other personnel exclusively to the Company nor is the Advisor, its Affiliates
or any of their officers or other employees obligated to dedicate any specific portion of its or their time to the Company or its business,
except as necessary to perform the services required hereunder.
(f) The
Advisor may retain, for and on behalf, and at the sole cost and expense, of the Company, such services of accountants, legal counsel,
tax counsel, appraisers, insurers, brokers, business developers, transfer agents, registrars, developers, investment banks, financial
advisors, underwriters, banks and other consultants and advisors as the Advisor deems necessary or advisable in connection with the management
and operations of the Company. Notwithstanding anything contained herein to the contrary, the Advisor shall have the right to cause any
such services to be rendered by its employees or Affiliates (which, for the avoidance of doubt, includes any employees, consultants or
agents of any Affiliate of the Advisor). The Advisor shall further be entitled to reasonably rely on qualified experts hired by the Advisor,
including any of the foregoing.
(g) Subject
to Section 2(d) above, the Advisor may enter into agreements with other parties in connection with its duties hereunder.
(h) Notwithstanding
anything to the contrary contained in this Agreement, it is agreed and understood that the European Advisor shall be responsible for providing
portfolio management services with respect to the NLOP Properties that are located outside of the United States, and such other services
contemplated by, and pursuant to the terms of, the European Advisory Agreement.
SECTION 3. OTHER ACTIVITIES OF THE ADVISOR
Nothing herein shall prevent
the Advisor or its Affiliates (or their members, officers, directors, employees, agents, representatives, advisors or others) from engaging
in any other business or activities, or from rendering services of any kind to any other Person, including advisory or other services
to others similar to those set forth in this Agreement. The Company recognizes that it is not entitled to preferential treatment in receiving
information, recommendations and other services from the Advisor. The Company and the Board of Trustees acknowledge that the Advisor and/or
one or more of its Affiliates may be or become subject to various conflicts of interest. The Advisor shall act in good faith to endeavor
to identify to the Independent Trustees any conflicts that may arise among the Company, the Advisor and/or any other Person or entity
on whose behalf the Advisor may be engaged.
SECTION 4. AGENCY
The Advisor shall act as agent
of the Company in making, acquiring, financing and disposing of assets of the Company, disbursing and collecting the Company’s funds,
paying the debts and fulfilling the obligations of the Company, supervising the performance of professionals engaged by or on behalf of
the Company and handling, prosecuting and settling any claims of or against the Company, the Board of Trustees, holders of the Company’s
securities or the Company’s representatives or properties.
SECTION 5. BANK ACCOUNTS
The Advisor may establish
and maintain, subject to any applicable conditions or limitations of the loan documents applicable to the Company, one or more bank accounts
in its own name for account of the Company or in the name of the Company or any Subsidiary (any such account, a “Company Account”),
and may collect and deposit funds into any such Company Account or Company Accounts, and disburse funds from any such Company Account
or Company Accounts. The Advisor shall from time to time render appropriate accountings of such collections and payments to the Board
of Trustees and, upon request, to the auditors of the Company or any Subsidiary.
SECTION 6. RECORDS
The Advisor shall maintain
appropriate books of accounts and records relating to services performed under this Agreement, and such books of account and records shall
be accessible for inspection by representatives of the Company at any time during normal business hours upon reasonable advance notice
to the Advisor.
SECTION 7. CONFIDENTIALITY
The Advisor shall keep confidential
any and all non-public information obtained in connection with the services rendered under this Agreement and shall not disclose any such
information to any Person, except to (i) its Affiliates, members, officers, directors, employees, agents, representatives or advisors
who reasonably need such information for the Advisor to be able to perform its duties hereunder (and the European Advisor to carry out
its duties under the European Advisory Agreement, (ii) appraisers, lenders, bankers and other parties as necessary in the ordinary
course of the Company’s business, (iii) in connection with any governmental or regulatory filings or requests of the Company
or the Advisor or any of their Affiliates, (v) as required by applicable law or regulation, including any applicable disclosure requirements
applicable to the Company and the Advisor and their Affiliates under securities or blue sky laws or stock exchange listing requirements,
or (vi) with the prior written consent of the Board of Trustees. The confidentiality provisions of this Section 7 shall
survive for a period of three (3) years after the Termination Date.
SECTION 8. LIMITATION ON ACTIVITIES; INSURANCE
(a) The
Advisor shall refrain from any action that, in its sole judgment made in good faith, (i) can reasonably be expected to result in
the loss of the Company’s status as a REIT under the Code, or to subject the Company to regulation under the Investment Company
Act, or (ii) can reasonably be expected to result in the violation of any law, rule or regulation of any governmental body or
agency having jurisdiction over the Company or any Subsidiary that would materially adversely affect the Company or that would otherwise
not be permitted by such entity’s Governing Instruments. If the Advisor is ordered to take any such action by the Board of Trustees,
the Advisor shall promptly notify the Board of Trustees of the Advisor’s judgment with respect thereto. Notwithstanding the foregoing,
the Advisor and its Affiliates, officers and employees shall not be liable to the Company or any Subsidiary, the Board of Trustees, or
the Company’s or any Subsidiary’s shareholders or partners for any act or omission by the Advisor, its Affiliates, officers
or employees except as provided in Section 11.
(b) The
Advisor shall at all times during the term of this Agreement (including the Initial Term and any Renewal Term) maintain such insurance
coverage as is customarily maintained by other advisors, managers or servicers of similar assets. No fidelity bond shall be required.
(c) The
Advisor acknowledges receipt of the Company’s Code of Business Conduct and Ethics, and Policy on Insider Training, and agrees to
require its employees who provide services to the Company to comply with such codes and policies.
SECTION 9. COMPENSATION
(a) Management
Fee. As compensation for the Advisor’s services under this Agreement, during the Term, the Company will pay the Advisor a management
fee of $625,000.00 per calendar month (the “Base Management Fee”), which shall be subject to adjustment as set
forth in this Section 9 (as may be adjusted pursuant to this Section 9, the “Management Fee”).
(b) Initial
Management Fee Proration. The Management Fee for the initial calendar month following the Effective Time shall be prorated to an amount
equal to the product of (i) the Base Management Fee and (ii) the quotient obtained by dividing (a) the number of calendar
days remaining in such calendar month following the Effective Date; and (b) the total number of calendar days in such initial calendar
month.
(c) Adjustments
for Dispositions. If a Qualified Disposition of a NLOP Property (each a “Disposed Property”) occurs during a calendar
month, the Management Fee for such calendar month shall be reduced, for each such Disposed Property, by an amount equal to the product
of (i) the Applicable Disposition Discount with respect to such Disposed Property, and (ii) the quotient obtained by dividing
(a) the number of calendar days remaining in such calendar month following the closing date of such Qualified Disposition and (b) the
total number of calendar days in such calendar month. For each full calendar month following any such Qualified Disposition, the Management
Fee shall be reduced by the Applicable Disposition Discount with respect to such Disposed Property.
(d) Limitations.
In no event shall the Management Fee for any calendar month be greater than the Management Fee in effect during the preceding calendar
month (without regard for the adjustments, if any, as set forth in Section 9(b) above), and in no event shall the aggregate
Management Fee payable for a given fiscal year exceed $7.5 million. For the avoidance of doubt, the Management Fee shall not be modified
or reduced except as expressly set forth in this Section 9, and shall not be modified or reduced for changes and amendments
with respect to any NLOP Property, other than a Qualifying Disposition, including, but not limited to (i) new or amended lease arrangements,
(ii) property vacancies, (iii) insolvency or bankruptcy, or (iv) changes in the operating performance of such NLOP Property.
The Management Fee to be paid to the Advisor under this Section 9, a portion of which shall be paid to the European Advisor
as agreed between the Advisor and the European Advisor for the services provided by the European Advisor under the European Advisory Agreement,
is not intended to compensate the Advisor with respect to the NLOP Properties that are located outside of the United States.
(e) Invoices.
Promptly following the end of each calendar month, the Advisor shall prepare and deliver to the Company a written invoice for such calendar
month’s Management Fee. Upon the request of the Board of Trustees, the Advisor shall also provide the supporting calculations with
respect to the Management Fee for any given calendar month (provided that such a request, and the Company’s delivery thereof, shall
not delay the payment date set forth in Section 9(f) below).
(f) Payment.
The Management Fee shall be payable, in cash, monthly in arrears, by wire transfer of immediately available funds in accordance with the
Advisor’s written invoice, on the later of (i) 30 calendar days following the end of such calendar month or (ii) 20 calendar
days following receipt of the Advisor’s invoice for such prior calendar month’s Management Fee.
SECTION 10. EXPENSES
(a) Administrative
Reimbursement. During the Term, the Company shall pay the Advisor a base administrative reimbursement of $333,333.33 per calendar
month (as may be adjusted pursuant to Section 10(b), the “Administrative Reimbursement”) as reimbursement
for the Advisor Costs.
(b) Initial
Administrative Reimbursement Proration. The Administrative Reimbursement for the initial calendar month following the Effective Time
shall be prorated to an amount equal to the product of (i) the Administrative Reimbursement and (ii) the quotient obtained by
dividing (a) the number of calendar days remaining in such calendar month following the Effective Date; and (b) the number of
calendar days in such initial calendar month.
(c) Advisor
Costs. Except as otherwise expressly provided herein or approved by majority vote of the Independent Trustees or the Audit Committee,
in exchange for the Administrative Reimbursement, the Advisor shall bear the following expenses incurred in connection with the performance
of its duties under this Agreement, and shall not be entitled to reimbursement with respect to such expenses (collectively, the “Advisor
Costs”):
(i) base
salary, cash incentive compensation and other employment expenses of personnel employed by the Advisor, including, but not limited to,
salaries, wages, payroll taxes and the cost of employee benefit plans (other than equity awards granted by the Company pursuant to an
equity compensation plan approved by the Board of Trustees);
(ii) fees
and travel and other expenses of employees of the Advisor, to the extent not incurred while providing services pursuant to this Agreement;
(iii) rent,
telephone, utilities, office furniture, equipment and machinery (including computers, to the extent utilized) and other office expenses
of the Advisor, except to the extent such expenses relate solely to an office maintained by the Company separate from the offices of the
Advisor; and
(iv) miscellaneous
administrative expenses relating to performance by the Advisor of its obligations hereunder.
(d) Expense
Reimbursement. Except as expressly otherwise provided in this Agreement, the Company shall pay (or shall reimburse the Advisor for)
all of its and its Subsidiaries’ expenses and all costs and expenses associated with the services to be provided pursuant to this
Agreement. Without limiting the generality of the foregoing, it is specifically agreed that the following out-of-pocket expenses of the
Company and its Subsidiaries shall be paid by the Company (or shall be reimbursed by the Company to the Advisor) (collectively, the “Expenses”):
(i) the
cost of borrowed money;
(ii) taxes
on income and taxes and assessments on real and personal property, if any, and all other taxes applicable to the Company or its Subsidiaries;
(iii) legal,
auditing, accounting, underwriting, brokerage, listing, reporting, registration and other fees, and printing, engraving and other expenses
and taxes incurred in connection with the issuance, distribution, transfer, trading, registration and listing of the Company’s or
any of its Subsidiaries’ securities on a stock exchange, including transfer agent’s, registrar’s and indenture trustee’s
fees and charges;
(iv) expenses
of organizing, restructuring, reorganizing or liquidating the Company or any of its Subsidiaries, or of revising, amending, converting
or modifying the Company’s or any of its Subsidiaries’ Governing Instruments;
(v) fees
and travel and other expenses paid to members of the Board of Trustees and officers of the Company or those of individuals in similar
positions with any of its Subsidiaries in their capacities as such (but not in their capacities as officers or employees of the Advisor)
and fees and travel and other expenses paid to advisors, contractors, mortgage servicers, consultants and other agents and independent
contractors employed by or on behalf of the Company and its Subsidiaries (whether or not engaged by the Advisor rather than directly by
the Company);
(vi) expenses
directly connected with the investigation, disposition or ownership of real estate interests or other property (including third party
property diligence costs, appraisal reporting, the costs of foreclosure, insurance premiums, legal services, brokerage and sales commissions,
maintenance, repair, improvement and local management of property), other than expenses with respect thereto of employees of the Advisor,
to the extent that such expenses are to be borne by the Advisor pursuant to this Agreement, including Section 10(c);
(vii) all
insurance costs (including officer and trustee liability insurance) incurred in connection with the Company and its Subsidiaries or in
connection with any officer and trustee indemnity agreement to which the Company or any of its Subsidiaries is a party or arising under
the Company’s or any of its Subsidiaries’ Governing Instruments;
(viii) expenses
connected with payments of distributions, dividends or interest or contributions in cash or any other form made or caused to be made by
the Trustees to holders of securities of the Company or any of its Subsidiaries;
(ix) all
expenses connected with communications to holders of securities of the Company or its Subsidiaries and other administrative work necessary
to maintaining relations with holders of securities, including the proxy solicitation materials and reports to holders of the Company’s
or its Subsidiaries’ securities;
(x) legal,
accounting, auditing and other professional services fees and expenses in addition to those described above;
(xi) filing
and recording fees and costs for regulatory or governmental filings, approvals and notices;
(xii) the
costs and expenses of conceiving, implementing, managing and settling all equity award or compensation plans or arrangements established
by the Company or any of its Subsidiaries, including but not limited to the value of awards made by the Company or any of its Subsidiaries
to members of the Board of Trustees, the Advisor or its employees, if any, and payment of any employment or withholding taxes in connection
therewith; and
(xiii) all
other costs and expenses of the Company and its Subsidiaries, other than those to be specifically borne by the Advisor pursuant to Section 10(c) above.
(e) Invoices.
Promptly following the end of each calendar month, the Advisor shall prepare and deliver to the Company a written invoice for such calendar
month’s Expenses paid by the Advisor and for which the Advisor is entitled to reimbursement pursuant to Section 10(d) and
such Expenses (as defined in the European Advisory Agreement) paid by the European Advisor and for which the European Advisor is entitled
to reimbursement pursuant to the European Advisory Agreement (collectively, the “Reimbursable Expenses”). Upon the
request of the Board of Trustees, the Advisor shall also provide the reasonable supporting documentation with respect to the Reimbursable
Expenses for any given calendar month (provided that such a request, and the Advisor’s delivery thereof, shall not delay the payment
date set forth in Section 10(f) below).
(f) Payment.
The Administrative Reimbursement shall be payable, in cash, monthly in arrears, by wire transfer of immediately available funds to the
account or accounts designated in writing by the Advisor, on the date that is 30 calendar days following the end of such calendar
month. Reimbursable Expenses for which the Advisor is entitled to reimbursement pursuant to Section 10(d) shall be payable,
in cash, monthly in arrears, by wire transfer of immediately available funds in accordance with the Advisor’s written invoice, on
the later of (i) 30 calendar days following the end of such calendar month or (ii) 20 calendar days following receipt of the
Advisor’s invoice for such prior calendar month’s Expenses.
(g) The
Administrative Reimbursement and Reimbursable Expenses to be paid to the Advisor under this Section 10, a portion of which
shall be paid to the European Advisor as agreed between the Advisor and the European Advisor for the services provided by the European
Advisor under the European Advisor Agreement, are not intended to compensate the Advisor with respect to the NLOP Properties that are
located outside of the United States.
SECTION 11. LIMITATION OF LIABILITY; INDEMNIFICATION
(a) Notwithstanding
anything to the contrary in this Agreement, the Advisor shall have no responsibility under this Agreement other than to render the services
as required under this Agreement in good faith and shall not be responsible for any action of the Board of Trustees in following or declining
to follow any advice or recommendations of the Advisor, including as set forth in Section 8(a). The Advisor, its Affiliates
and their members, managers, officers and employees will not be liable to the Company or any Subsidiary, to the Board of Trustees or to
the Company’s or any Subsidiary’s shareholders or partners for any acts or omissions by the Advisor, its Affiliates, members,
managers, officers or employees pursuant to or in accordance with this Agreement, except by reason of acts constituting bad faith, willful
misconduct or gross negligence.
(b) The
Company shall, to the full extent lawful, reimburse, indemnify and hold the Advisor, its Affiliates, members, managers, officers and employees,
sub-advisors and each other Person, if any, controlling the Advisor or its Affiliates (each, an “Advisor Indemnified Party”),
harmless of and from any and all expenses, losses, damages, liabilities, demands, charges and claims of any nature whatsoever (including
attorneys’ fees) (collectively, “Losses”) in respect of or arising from any acts or omissions of such Advisor
Indemnified Party made in good faith in the performance of the Advisor’s duties under this Agreement and not constituting such Advisor
Indemnified Party’s bad faith, willful misconduct or gross negligence.
(c) The
Advisor shall, to the full extent lawful, reimburse, indemnify and hold the Company, its Subsidiaries, its shareholders, trustees, officers
and employees and each other Person, if any, controlling the Company or its Subsidiaries (each, a “Company Indemnified Party”),
harmless of and from any and all Losses in respect of or arising from any acts or omissions of the Advisor constituting bad faith, willful
misconduct or gross negligence.
(d) Promptly
after receipt by the Advisor Indemnified Party or the Company Indemnified Party, as applicable (the “Indemnified Party”)
of notice of the commencement of any action, such Indemnified Party shall, if a claim in respect thereof is to be made pursuant hereto,
notify the indemnifying party in writing of the commencement thereof; but the omission to so notify the indemnifying party shall not relieve
it from any liability that it may have to any Indemnified Party pursuant to this Section 11. In case any such action shall
be brought against an Indemnified Party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it shall wish, to assume the defense thereof, with counsel satisfactory
to such Indemnified Party and, after notice from the indemnifying party to such Indemnified Party of its election to assume the defense
thereof, the indemnifying party shall not be liable to such Indemnified Party under this Section 11, as applicable, for any
legal expenses of other counsel or any of the expenses, in each case subsequently incurred by such Indemnified Party, unless (i) the
indemnifying party and the Indemnified Party shall have mutually agreed to the retention of such counsel, or (ii) the named parties
to any such proceeding (including any impleaded parties) include both the indemnifying party and Indemnified Party and representation
of both parties by the same counsel would be inappropriate in the reasonable opinion of the Indemnified Party, due to actual or potential
differing interests between them.
(e) The
Company shall be required to advance funds to an Advisor Indemnified Party for legal expenses and other costs incurred as a result of
any legal action or proceeding if a claim in respect thereof is to be made pursuant hereto and if requested by such Advisor Indemnified
Party if (i) such suit, action or proceeding relates to or arises out of, or is alleged to relate to or arise out of or has been
caused or alleged to have been caused in whole or in part by, any action or inaction on the part of the Advisor Indemnified Party in the
performance of its duties or provision of its services on behalf of the Company; and (ii) the Advisor Indemnified Party undertakes
to repay any funds advanced pursuant to this Section 11(e) in cases in which such Indemnified Party would not be entitled
to indemnification under Section 11(b). If advances are required under this Section 11(e), the Advisor Indemnified
Party shall furnish the Company with an undertaking as set forth in clause (ii) of the preceding sentence and shall thereafter have
the right to bill the Company for, or otherwise require the Company to pay, at any time and from time to time after such Advisor Indemnified
Party shall become obligated to make payment therefor, any and all reasonable amounts for which such Advisor Indemnified Party is entitled
to indemnification under this Section 11, and the Company shall pay the same within thirty (30) days after request for payment.
In the event that a determination is made by a court of competent jurisdiction or an arbitrator that the Company is not so obligated in
respect of any amount paid by it to a particular Advisor Indemnified Party, such Advisor Indemnified Party will refund such amount within
sixty (60) days of such determination, and in the event that a determination by a court of competent jurisdiction or an arbitrator is
made that the Company is so obligated in respect to any amount not paid by the Company to a particular Advisor Indemnified Party, the
Company will pay such amount to such Advisor Indemnified Party within thirty (30) days of such final determination, in either case together
with interest at the current prime rate plus two percent (2%) from the date paid until repaid or the date it was obligated to be paid
until the date actually paid.
SECTION 12. NO JOINT VENTURE
Nothing in this Agreement
shall be construed to make the Company and the Advisor partners or joint venturers or impose any liability as such on either of them.
SECTION 13. TERM
This Agreement shall have
an initial term of three (3) years (the “Initial Term”), and shall automatically renew thereafter for successive
one (1) year terms (each a “Renewal Term,” and such term, as renewed, the “Term”) without further
action by either the Company or the Advisor, unless earlier terminated in accordance with the terms of this Agreement.
SECTION 14. TERMINATION
(a) No
later than 180 days prior to the expiration of the Initial Term or any Renewal Term, the Advisor may deliver written notice of its intention
not to renew the term, whereupon the term of this Agreement shall not be renewed and extended, and this Agreement shall terminate effective
on the expiration date of such Initial Term or Renewal Term, as applicable.
(b) The
Company may terminate this Agreement upon 90 days’ prior written notice (a “Company Termination for Convenience”);
provided, however, that, if requested by the Company, the Advisor shall provide transition services (including, without limitation, assistance
with identifying a replacement advisor) to the Company for up to an additional 90 days following the effective date of such Company Termination
for Convenience, which services shall be subject to the same compensation and reimbursements as in effect at the time of such Company
Termination for Convenience is delivered.
(c) The
Company may terminate this Agreement immediately, without prior notice to the Advisor, for Cause.
(d) The
Advisor may terminate this Agreement (i) immediately, without prior notice to the Company, with Good Reason or (ii) effective
concurrently with or within 90 days following the Termination Date (as defined in the European Advisory Agreement) of the European Advisory
Agreement (a “Cross Default Termination”).
SECTION 15. TERMINATION FEE
(a) In
the event of a Qualifying Termination, the Company shall pay the Advisor a fee (the “Termination Fee”) in an amount
equal to the product of (i) either (a) 2.0, if such Qualifying Termination occurs prior to the end of the Initial Term, or (b) 1.5,
if such Qualifying Termination occurs on or after the end of the Initial Term, and (ii) the sum of the Management Fee payable by
the Company during the twelve full calendar months preceding such termination (the “Trailing Annual Fees”). In
the event of a Qualifying Termination that occurs on or prior to the end of the twelfth full calendar month following the Effective Time,
Trailing Annual Fees shall be deemed to equal the product of (i) the average of the sum of the Management Fees payable during each
completed calendar month following the Effective Time (or $1,875,000.00, if no calendar month has been completed following the Effective
Time), and (ii) twelve. The Termination Fee shall be payable to the Advisor on or before the Termination Date of this Agreement,
and shall be in addition to all other earned but unpaid Management Fee and Administrative Reimbursement, and any incurred but unreimbursed
Expenses accumulated as of the Termination Date, in each case, in accordance with Section 16.
(b) For
the avoidance of doubt, in no event shall a Termination Fee be payable exclusively as a result of the liquidation, dissolution or winding
up of the Company.
SECTION 16. ACTION UPON TERMINATION
(a) From
and after the Termination Date, the Advisor shall not be entitled to compensation for further services under this Agreement, but shall
be paid all compensation accruing through the Termination Date, including, without limitation, any Termination Fee due in connection with
such termination.
(b) On
the Termination Date or as promptly thereafter as practicable, the Advisor shall forthwith:
(i) after
deducting any earned but unpaid Management Fee or Administrative Reimbursement (including, for the avoidance of doubt, the prorated portion
of the Management Fee or Administrative Reimbursement for the period between the beginning of the calendar month during which the termination
occurred and the Termination Date) and incurred but unreimbursed Expenses accumulated, in each case, through the Termination Date, including,
without limitation, any Termination Fee due in connection with such termination, pay over to the Company all money collected and held
for the account of the Company or a Subsidiary pursuant to this Agreement;
(ii) deliver
to the Board of Trustees a full accounting, including a statement showing all payments collected and money held by it, covering the period
following the date of the last accounting furnished to the Board of Trustees with respect to the Company or a Subsidiary; and
(iii) deliver
to the Board of Trustees all property and documents of the Company or any Subsidiary then in the custody of the Advisor; provided, however,
that the Advisor may retain copies of all such information.
(c) On
the Termination Date or as promptly thereafter as practicable, the Company shall (to the extent such amounts have not already been deducted
in accordance with Section 16(b)(i) above) forthwith:
(i) pay
to the Advisor all earned but unpaid Management Fees and Administrative Reimbursement (including, for the avoidance of doubt, the prorated
portion of the Management Fee or Administrative Reimbursement for the period between the beginning of the calendar month during which
the termination occurred and the Termination Date) through the Termination Date, including, without limitation, any Termination Fee due
in connection with such termination; and
(ii) reimburse
the Advisor for all incurred but unreimbursed Expenses payable to the Advisor under this Agreement and payable to the European Advisory
under the European Advisory Agreement through the Termination Date.
SECTION 17. ASSIGNMENT
Neither party may assign this
Agreement or its rights hereunder without the written consent of the other party, except that the Advisor may assign this Agreement (i) to
an Affiliate (only with respect to an entity described in clause (i) of the definition thereof) or other entity whose business and
operations are managed or supervised by WPC, or (ii) to a corporation, partnership, limited liability company, association, trust,
or other entity that is a successor (by merger, consolidation or otherwise) to the Advisor.
SECTION 18. RELEASE OF PROPERTY
(a) The
Advisor agrees that any money or other property of the Company or a Subsidiary thereof held by the Advisor under this Agreement shall
be held by the Advisor as custodian for the Company or such Subsidiary, and the Advisor’s records shall be appropriately marked
clearly to reflect the ownership of such money or other property by the Company or such Subsidiary. Upon the receipt by the Advisor of
a written request from the Board of Trustees requesting the Advisor to release to the Company or any Subsidiary any money or other property
then held by the Advisor for the account of the Company or any Subsidiary under this Agreement, the Advisor shall release such money or
other property to the Company or any Subsidiary within a reasonable period of time, but in no event later than 30 days following such
request. The Advisor shall not be liable to the Company, any Subsidiary, the Board of Trustees or the Company’s or any Subsidiary’s
shareholders or partners for any act or omission by the Company or any Subsidiary in connection with the money or other property released
to the Company or any Subsidiary in accordance with this Section 18.
(b) The
Company agrees to reasonably cooperate with the Advisor to the extent any release of money or other property to the Company or any Subsidiary,
and shall refrain from demanding any such release to the extent doing so may compromise the Company’s operations or Advisor’s
ability to effectively carry out its duties under this Agreement, or that may materially adversely affect the Company or not be permitted
by the Company’s or any Subsidiary’s Governing Instruments. If the Advisor is ordered release any money or other property
in a manner that may be adverse to the Company, as described in the preceding sentence, the Advisor shall promptly notify the Board of
Trustees of the Advisor’s judgment thereof. Notwithstanding the foregoing, the Advisor and its Affiliates, officers and employees
shall not be liable to the Company or any Subsidiary, the Board of Trustees, or the Company’s or any Subsidiary’s shareholders
or partners for any act or omission by the Advisor, its Affiliates, officers or employees except as provided in Section 11.
SECTION 19. NOTICES
Unless expressly provided
otherwise in this Agreement, all notices, requests, demands and other communications required or permitted under this Agreement shall
be in writing and shall be deemed to have been duly given, made and received when delivered against receipt or upon actual receipt of
(i) personal delivery, (ii) delivery by reputable overnight courier, (iii) delivery by email, facsimile transmission or
email against answerback or (iv) delivery by registered or certified mail, postage prepaid, return receipt requested, addressed as
set forth below:
One Manhattan West
395 Ninth Avenue
New York, NY 10001
Attention: Chief Legal Officer
One Manhattan West
395 Ninth Avenue
New York, NY 10001
Attention: Chief Legal Officer
Either party may alter the
address to which communications or copies are to be sent by giving notice of such change of address in conformity with the provisions
of this Section 19 for the giving of notice.
SECTION 20. SUCCESSORS AND ASSIGNS
This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective heirs, personal representatives, successors and permitted assigns
as provided in this Agreement.
SECTION 21. ENTIRE AGREEMENT
This Agreement contains the
entire agreement and understanding among the parties hereto with respect to the subject matter of this Agreement, 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 of this Agreement. The express terms of this Agreement control and supersede any course of performance
and/or usage of the trade inconsistent with any of the terms of this Agreement. This Agreement may not be modified or amended other than
by an agreement in writing executed by both parties.
SECTION 22. Arbitration
(a) Any
disputes, claims or controversies arising out of or relating to this Agreement, the provision of services by the Advisor pursuant to this
Agreement or the transactions contemplated hereby, including any disputes, claims or controversies brought by or on behalf of the Company
or the Advisor or any holder of equity interests (which, for purposes of this Section 22, shall mean any holder of record
or any beneficial owner of equity interests or any former holder of record or beneficial owner of equity interests) of the Company or
the Advisor, either on his, her or its own behalf, on behalf of the Company or the Advisor or on behalf of any series or class of equity
interests of the Company or the Advisor or holders of any equity interests of the Company or the Advisor against the Company or the Advisor
or any of their respective trustees, directors, members, officers, managers (including the Advisor or its successor), agents or employees,
including any disputes, claims or controversies relating to the meaning, interpretation, effect, validity, performance or enforcement
of this Agreement, including this arbitration agreement or the governing documents of the Company or the Advisor (all of which are referred
to as “Disputes”), or relating in any way to such a Dispute or Disputes shall, on the demand of any party to such Dispute
or Disputes, be resolved through binding and final arbitration in accordance with the Commercial Arbitration Rules (the “Rules”)
of the American Arbitration Association (“AAA”) then in effect, except as those Rules may be modified in this
Section 22. For the avoidance of doubt, and not as a limitation, Disputes are intended to include derivative actions against
the trustees, directors, officers or managers of the Company or the Advisor and class actions by a holder of equity interests against
those individuals or entities and the Company or the Advisor. For the avoidance of doubt, a Dispute shall include a Dispute made derivatively
on behalf of one party against another party. For purposes of this Section 22, the term “equity interest” shall
mean, (i) in respect of the Company, shares of beneficial interest of the Company, and (ii) in respect of the Advisor, “membership
interest” in the Advisor as defined in the Delaware Limited Liability Company Act, as amended.
(b) There
shall be three (3) arbitrators. If there are only two (2) parties to the Dispute, each party shall select one (1) arbitrator
within fifteen (15) days after receipt by respondent of a copy of the demand for arbitration. The arbitrators may be affiliated or interested
persons of the parties. If there are more than two (2) parties to the Dispute, all claimants, on the one hand, and all respondents,
on the other hand, shall each select, by the vote of a majority of the claimants or the respondents, as the case may be, one (1) arbitrator
within fifteen (15) days after receipt of the demand for arbitration. The arbitrators may be affiliated or interested persons of the claimants
or the respondents, as the case may be. If either a claimant (or all claimants) or a respondent (or all respondents) fail(s) to timely
select an arbitrator then the party (or parties) who has selected an arbitrator may request AAA to provide a list of three (3) proposed
arbitrators in accordance with the Rules (each of whom shall be neutral, impartial and unaffiliated with any party) and the party
(or parties) that failed to timely appoint an arbitrator shall have ten (10) days from the date AAA provides the list to select one
(1) of the three (3) arbitrators proposed by AAA. If the party (or parties) fail(s) to select the second (2nd) arbitrator
by that time, the party (or parties) who have appointed the first (1st) arbitrator shall then have ten (10) days to select one (1) of
the three (3) arbitrators proposed by AAA to be the second (2nd) arbitrator; and, if he/they should fail to select the second (2nd)
arbitrator by such time, AAA shall select, within fifteen (15) days thereafter, one (1) of the three (3) arbitrators it had
proposed as the second (2nd) arbitrator. The two (2) arbitrators so appointed shall jointly appoint the third (3rd) and presiding
arbitrator (who shall be neutral, impartial and unaffiliated with any party) within fifteen (15) days of the appointment of the second
(2nd) arbitrator. If the third (3rd) arbitrator has not been appointed within the time limit specified herein, then AAA shall provide
a list of proposed arbitrators in accordance with the Rules, and the arbitrator shall be appointed by AAA in accordance with a listing,
striking and ranking procedure, with each party having a limited number of strikes, excluding strikes for cause.
(c) The
place of arbitration shall be New York, New York, unless otherwise agreed by the parties.
(d) There
shall be only limited documentary discovery of documents directly related to the issues in dispute, as may be ordered by the arbitrators.
For the avoidance of doubt, it is intended that there shall be no depositions and no other discovery other than limited documentary discovery
as described in the preceding sentence.
(e) In
rendering an award or decision (the “Award”), the arbitrators shall be required to follow the laws of the State of
Maryland. Any arbitration proceedings or award rendered hereunder and the validity, effect and interpretation of this arbitration agreement
shall be governed by the Federal Arbitration Act, 9 U.S.C. §1 et seq. The Award shall be in writing and shall state the findings
of fact and conclusions of law on which it is based. Any monetary award shall be made and payable in U.S. dollars free of any tax, deduction
or offset. Subject to Section 22(g), each party against which the Award assesses a monetary obligation shall pay that obligation
on or before the thirtieth (30th) day following the date of the Award or such other date as the Award may provide.
(f) Except
to the extent expressly provided by this Agreement or as otherwise agreed by the parties thereto, each party involved in a Dispute shall
bear its own costs and expenses (including attorneys’ fees), and the arbitrators shall not render an award that would include shifting
of any such costs or expenses (including attorneys’ fees) or, in a derivative case or class action, award any portion of the Company’s
or the Advisor’s, as applicable, award to the claimant or the claimant’s attorneys. Each party (or, if there are more than
two (2) parties to the Dispute, all claimants, on the one hand, and all respondents, on the other hand, respectively) shall bear
the costs and expenses of its (or their) selected arbitrator and the parties (or, if there are more than two (2) parties to the Dispute,
all claimants, on the one hand, and all respondents, on the other hand) shall equally bear the costs and expenses of the third (3rd) appointed
arbitrator.
(g) Notwithstanding
any language to the contrary in this Agreement, the Award, including but not limited to, any interim Award, may be appealed pursuant to
the AAA’s Optional Appellate Arbitration Rules (“Appellate Rules”). The Award shall not be considered final
until after the time for filing the notice of appeal pursuant to the Appellate Rules has expired. Appeals must be initiated within
thirty (30) days of receipt of the Award by filing a notice of appeal with any AAA office. Following the appeal process, the decision
rendered by the appeal tribunal may be entered in any court having jurisdiction thereof. For the avoidance of doubt, and despite any contrary
provision of the Appellate Rules, this Section 22(f) shall apply to any appeal pursuant to this Section 22(f) and
the appeal tribunal shall not render an award that would include shifting of any costs or expenses (including attorneys’ fees) of
any party.
(h) Following
the expiration of the time for filing the notice of appeal, or the conclusion of the appeal process set forth in Section 22(g),
the Award shall be final and binding upon the parties thereto and shall be the sole and exclusive remedy between those parties relating
to the Dispute, including any claims, counterclaims, issues or accounting presented to the arbitrators. Judgment upon the Award may be
entered in any court having jurisdiction. To the fullest extent permitted by law, no application or appeal to any court of competent jurisdiction
may be made in connection with any question of law arising in the course of arbitration or with respect to any award made except for actions
relating to enforcement of this agreement to arbitrate or any arbitral award issued hereunder and except for actions seeking interim or
other provisional relief in aid of arbitration proceedings in any court of competent jurisdiction.
(i) This
Section 22 is intended to benefit and be enforceable by the Company, the Advisor and their respective holders of equity interests,
trustees, directors, officers, managers (including the Advisor or its successor), agents or employees, and their respective successors
and assigns and shall be binding upon the Company, the Advisor and their respective holders of equity interests, and be in addition to,
and not in substitution for, any other rights to indemnification or contribution that such individuals or entities may have by contract
or otherwise.
SECTION 23. GOVERNING LAW
This Agreement and all questions
relating to its validity, interpretation, performance and enforcement shall be governed by and construed, interpreted and enforced in
accordance with the laws of the State of New York, notwithstanding any New York or other conflict-of-law provisions to the contrary.
SECTION 24. NO WAIVERS
Neither the failure nor any
delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof,
nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or
of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence
be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective
unless it is in writing and is signed by the party asserted to have granted such waiver.
SECTION 25. HEADINGS
The titles of paragraphs and
subparagraphs 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 of this Agreement.
SECTION 26. 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. Counterparts may be delivered via facsimile, electronic mail (including
any electronic signature covered by the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act, the Electronic Signatures
and Records Act or other applicable law, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be
deemed to have been duly and validly delivered and be valid and effective for all purposes. This Agreement shall become binding when one
or more counterparts of this Agreement, individually or taken together, shall bear the signatures of all of the parties reflected hereon
as the signatories.
SECTION 27. SURVIVAL
Sections 1, 7, 11, 15, 16,
20, 22, 23, 25 and 27 shall survive the termination hereof. Any termination of this Agreement shall be without prejudice to the rights
of the parties hereto accrued prior to the termination or upon termination.
SECTION 28. Severability
The provisions of this Agreement
are independent of and separable 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.
[Remainder of this page intentionally left
blank]
IN WITNESS WHEREOF, the parties
hereto have executed this Agreement as of the date first written above.
| | COMPANY |
| | |
| | Net Lease Office Properties, |
| | a Maryland real estate trust |
| | |
| | By: |
/s/ Jason E. Fox |
| | |
Name: |
Jason E. Fox |
| | |
Title: |
Chief Executive
Officer |
| | |
|
| | ADVISOR |
| | |
| | W. P. Carey Management LLC, |
| | a Delaware limited liability company |
| | |
| | By: |
/s/ ToniAnn Sanzone |
| | |
Name: |
ToniAnn Sanzone |
| | |
Title: |
Chief Financial
Officer |
[Signature Page to Advisory Agreement]
Exhibit 10.4
ADVISORY AGREEMENT
dated as of November 1, 2023
between
Net
Lease Office Properties
and
W. P.
Carey & Co. B.V.
TABLE OF CONTENTS
|
Page |
|
|
SECTION 1. DEFINITIONS |
1 |
SECTION 2. APPOINTMENT AND DUTIES OF THE ADVISOR |
5 |
SECTION 3. OTHER ACTIVITIES OF THE ADVISOR |
8 |
SECTION 4. AGENCY |
8 |
SECTION 5. BANK ACCOUNTS |
9 |
SECTION 6. RECORDS |
9 |
SECTION 7. CONFIDENTIALITY |
9 |
SECTION 8. LIMITATION ON ACTIVITIES; INSURANCE |
9 |
SECTION 9. COMPENSATION |
10 |
SECTION 10. EXPENSES |
10 |
SECTION 11. LIMITATION OF LIABILITY; INDEMNIFICATION |
12 |
SECTION 12. NO JOINT VENTURE |
13 |
SECTION 13. TERM |
13 |
SECTION 14. TERMINATION |
13 |
SECTION 15. TERMINATION FEE |
14 |
SECTION 16. ACTION UPON TERMINATION |
14 |
SECTION 17. ASSIGNMENT |
14 |
SECTION 18. RELEASE OF PROPERTY |
15 |
SECTION 19. NOTICES |
15 |
SECTION 20. SUCCESSORS AND ASSIGNS |
16 |
SECTION 21. ENTIRE AGREEMENT |
16 |
SECTION 22. Arbitration |
16 |
SECTION 23. GOVERNING LAW |
18 |
SECTION 24. NO WAIVERS |
18 |
SECTION 25. HEADINGS |
18 |
SECTION 26. EXECUTION IN COUNTERPARTS |
18 |
SECTION 27. SURVIVAL |
19 |
SECTION 28. Severability |
19 |
|
|
Annex A: Covered Properties |
|
ADVISORY AGREEMENT
THIS ADVISORY AGREEMENT (this
“Agreement”) is made as of November 1, 2023 (the “Effective Date”) by and between Net Lease
Office Properties, a Maryland real estate investment trust (the “Company”), and W. P. Carey & Co. B.V.,
a Dutch limited liability company (together with its permitted assignees, the “Advisor”).
W
I T N E S S E T H:
WHEREAS, the Company, through
its own operations and the operations of its Subsidiaries (as defined herein), is in the business of owning, developing, managing and
disposing of office real property;
WHEREAS, the Company intends
to qualify as a Real Estate Investment Trust (a “REIT”) under the Code (as defined herein);
WHEREAS, the Company desires
to avail itself of the experience, sources of information, advice, assistance and certain facilities of, or 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 Trustees of, the Company, as provided in this Agreement;
WHEREAS, the Company and the
US Advisor have, concurrently with the execution of this Agreement, entered into that the US Advisory Agreement; and
WHEREAS, the Advisor is willing
to render such services on the terms and conditions hereinafter set forth.
NOW THEREFORE, in consideration
of the mutual agreements herein set forth, the parties hereto agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement,
the following terms have the definitions hereinafter indicated:
“AAA” has
the meaning set forth in Section 22(a) of this Agreement.
“Advisor”
has the meaning set forth in the preamble to this Agreement.
“Advisor Costs”
has the meaning set forth in Section 10(b) of this Agreement.
“Advisor Indemnified
Party” has the meaning set forth in Section 11(b) of this Agreement.
“Affiliate”
means, with respect to any Person, (i) any other Person directly or indirectly controlling, controlled by, or under common
control with such Person, (ii) any executive officer, general partner or managing member of such Person, (iii) any member of
the board of directors or board of managers (or bodies performing similar functions) of such Person and (iv) any legal entity for
which such Person acts as an executive officer, general partner or managing member. For the avoidance of doubt, and for purposes of this
Agreement, the Company shall not be considered an Affiliate of the Advisor.
“Agreement”
means this Advisory Agreement, as amended from time to time.
“Appellate Rules”
has the meaning set forth in Section 22(g) of this Agreement.
“Audit Committee”
means the audit committee of the Board of Trustees or the committee or body performing similar functions.
“Award”
has the meaning set forth in Section 22(e) of this Agreement.
“Board of Trustees”
means the board of trustees of the Company.
“Cause”
means the occurrence of any of the following events:
(a) any
material breach of a material term of this Agreement by the Advisor that has not been cured within 30 days following written notice thereof
from the Company;
(b) fraud,
criminal conduct, willful misconduct or willful or grossly negligent breach by the Advisor in the performance of its duties under this
Agreement that, in each case, is determined by a majority of the Company’s Independent Trustees to be materially adverse to the
Company;
(c) the
commencement of any proceeding relating to the Advisor’s bankruptcy or insolvency, or the dissolution of the Advisor, including
an order for relief in an involuntary bankruptcy case or the Advisor authorizing or filing a voluntary bankruptcy petition; or
(d) termination
of the US Advisory Agreement by the Company for “Cause” (as defined in the US Advisory Agreement) pursuant to subsections
(a), (b) or (c) of the definition thereof.
“Change in Control”
means the occurrence of any of the following events:
(a) a
transaction or series of transactions whereby any “person” or related “group” of “persons” (as such
terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) (other than the Company or any Subsidiary of the Company)
directly or indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of securities of the
Company possessing more than fifty percent (50%) of the total combined voting power of the Company’s securities outstanding immediately
after such acquisition; provided, however, that no person or group shall be treated for purposes of this clause (b)(ii) as beneficially
owning fifty percent (50%) or more of the combined voting power of the Company solely as a result of the voting power held in the Company
prior to the consummation of the transaction;
(b) during
any period of two (2) consecutive years, individuals who, at the beginning of such period, constitute the Board of Trustees together
with any new trustee(s) (other than a trustee designated by a person who shall have entered into an agreement with the Company to
effect a transaction described in the preceding clause (i) or the succeeding clause (iii) of this definition) whose election
by the Board of Trustees or nomination for election by the Company’s shareholders was approved by a vote of at least two-thirds
(2/3) of the trustees then still in office who either were trustees at the beginning of the two (2)-year period or whose election or nomination
for election was previously so approved, cease for any reason to constitute a majority thereof; or
(c) the
consummation by the Company (whether directly involving the Company or indirectly involving the Company through one or more intermediaries)
of (A) a merger, consolidation, reorganization, or business combination, (B) a sale or other disposition of all or substantially
all of the Company’s assets in any single transaction or series of related transactions or (C) the acquisition of all or substantially
all of the assets or stock of another entity, in each case, other than a transaction:
(i) which
results in the Company’s voting securities outstanding immediately before the transaction continuing to represent (either by remaining
outstanding or by being converted into voting securities of the Company or the person that, as a result of the transaction, controls,
directly or indirectly, the Company or owns, directly or indirectly, all or substantially all of the Company’s assets or otherwise
succeeds to the business of the Company (the Company or such person, the “Successor Entity”)) directly or indirectly,
at least a majority of the combined voting power of the Successor Entity’s outstanding voting securities immediately after the transaction,
and following which the Successor Entity continues to own all or substantially all the assets that the Company owned immediately before
the transaction and succeeds to its business, and
(ii) after
which no person or group beneficially owns voting securities representing more than fifty percent (50%) of the combined voting power of
the Successor Entity; provided, however, that no person or group shall be treated for purposes of this clause (b)(ii) as beneficially
owning fifty percent (50%) or more of the combined voting power of the Successor Entity solely as a result of the voting power held in
the Company prior to the consummation of the transaction; or
(d) approval
by the Company’s shareholders of a liquidation or dissolution of the Company.
“Code”
means the Internal Revenue Code of 1986, as amended.
“Common Share”
means a common share of beneficial interest, par value $0.001 per share, of the Company now or hereafter authorized as common voting shares
of the Company.
“Company”
has the meaning set forth in the preamble to this Agreement.
“Company Account”
has the meaning set forth in Section 5 of this Agreement.
“Company Indemnified
Party” has the meaning set forth in Section 11(c) of this Agreement.
“Company Termination
for Convenience” has the meaning set forth in Section 14(b) of this Agreement.
“Covered Properties”
means the real properties of the Company or its Subsidiaries located outside of the United States listed in Annex A hereto.
“Cross Default Termination”
has the meaning set forth in Section 14(d) of this Agreement.
“Disputes”
has the meaning set forth in Section 22(a) of this Agreement.
“Effective Date”
has the meaning set forth in the preamble to this Agreement.
“European Qualifying
Termination” means the occurrence of any of the following events:
(a) Termination
for Convenience by the Company;
(b) Termination
by the Advisor with Good Reason; or
(c) Cross
Default Termination by the Advisor if the US Advisory Agreement is terminated pursuant to (i) a “Termination for Convenience”
by the Company or (ii) a termination by the Advisor with “Good Reason” (each as defined in the US Advisory Agreement).
“Exchange Act”
means the Securities Exchange Act of 1934, as amended.
“Expenses”
has the meaning set forth in Section 10(c) of this Agreement.
“Good Reason”
means the occurrence of any of the following events:
(a) any
failure to obtain a reasonably satisfactory agreement from any successor to the Company to assume the Company’s obligations under
the Agreement;
(b) any
material breach of this Agreement by the Company that has not been cured within 30 days following written notice thereof from the Advisor;
or
(c) the
Advisor has the right to terminate the US Advisory Agreement with “Good Reason” (as defined in the US Advisory Agreement)
pursuant to subsection (a) or (b) of the definition thereof.
“Governing Instruments”
means, with regard to any entity, the declaration of trust and bylaws in the case of a real estate investment trust, the articles of incorporation
and bylaws in the case of a corporation, the certificate of limited partnership (if applicable) and the partnership agreement in the case
of a general or limited partnership, the articles of formation and the operating agreement in the case of a limited liability company,
or, in each case, comparable governing documents.
“Indemnified Party”
has the meaning set forth in Section 11(d) of this Agreement.
“Independent Trustee”
means any member of the Board of Trustees who, on the date at issue, is “independent” as determined by application of the
rules and regulations of any applicable securities exchange on which the Common Shares are listed.
“Initial Term”
has the meaning set forth in Section 13 of this Agreement.
“Investment Company
Act” means the Investment Company Act of 1940, as amended.
“Losses”
has the meaning set forth in Section 11(b) of this Agreement.
“Person”
means any natural person, corporation, partnership, association, limited liability company, estate, trust, joint venture, any federal,
state, county or municipal government or any bureau, department or agency thereof or any other legal entity and any fiduciary acting in
such capacity on behalf of the foregoing.
“REIT”
has the meaning set forth in the recitals to this Agreement”
“Renewal Term”
has the meaning set forth in Section 13 of this Agreement.
“Required Approval”
has the meaning set forth in Section 2(d) of this Agreement:
“Rules”
has the meaning set forth in Section 22(a) of this Agreement.
“SEC” means
the U.S. Securities and Exchange Commission.
“Securities Act”
means the Securities Act of 1933, as amended.
“Subsidiary”
means any subsidiary of the Company and any partnership, the general partner of which is the Company or any subsidiary of the Company
and any limited liability company, the managing member of which is the Company or any subsidiary of the Company.
“Term”
has the meaning set forth in Section 13 of this Agreement.
“Termination Date”
means the effective date of any termination pursuant to Section 14.
“Trustee”
means any person holding such office on the Board of Trustees, as of any particular time.
“US Advisor”
means W. P. Carey Management LLC, a wholly owned subsidiary of WPC.
“US Advisory Agreement”
means that certain US Advisory Agreement entered into by and between the Company and the US Advisor concurrently with this Agreement,
as such agreement may be modified or amended from time to time in accordance with its terms.
“WPC” means
W. P. Carey Inc., a Maryland corporation, of which the Advisor is a wholly owned subsidiary.
SECTION 2. APPOINTMENT AND DUTIES OF THE
ADVISOR
(a) The
Company hereby appoints the Advisor to provide management services with respect to the asset management, property disposition support,
strategic management services, and related services, in each case, related to the Covered Properties, and the Advisor hereby agrees to
use its commercially reasonable efforts to perform each of the duties set forth herein. The appointment of the Advisor shall be exclusive
to the Advisor, except to the extent that the Advisor elects, pursuant to the terms and conditions of this Agreement, to cause the duties
of the Advisor hereunder to be provided by third parties.
(b) The
Advisor, in its capacity as such, shall at all times be subject to the supervision, direction and management of the Board of Trustees,
and will have only such functions and authority as the Company may delegate to it and as set forth in this Agreement. The Board of Trustee
has dispositive power in the event of any conflict between the Board of Trustees and the Advisor with respect to the functions and authority
delegated to the Advisor above.
(c) The
Company and the Board of Trustees, subject to the limitations set forth in Section 2(d), hereby delegates the following functions
and authority to the Advisor, and the Advisor agrees to perform (or cause to be performed) such services and activities relating to the
Covered Properties as may be appropriate, including, without limitation:
(i) sourcing,
investigating and evaluating prospective disposition, exchange or other transactions with respect to the Covered Properties (including
potential seller financing related thereto, as may be permitted), and making recommendations with respect thereto to the Board of Trustees,
where applicable;
(ii) conducting
negotiations with brokers, purchasers and their respective agents and representatives, investment bankers and other parties regarding
the disposition, exchange or other transactions with respect to the Covered Properties (including potential seller financing related thereto,
as may be permitted), and subject to any necessary approvals from the Board of Trustees, executing and delivering documentation related
thereto and performing the transactions contemplated thereby;
(iii) managing
and monitoring the operating performance of Covered Properties and cooperating with the U.S. Advisor to provide periodic reports to the
Board of Trustees, in form, substance and frequency as the Advisor deems reasonably necessary or as the Board of Trustees may otherwise
reasonably request;
(iv) assisting
the Company in developing criteria that are specifically tailored to the Company’s operations and divestiture objectives with respect
to the Covered Properties;
(v) engaging
and supervising independent contractors that provide services relating to the Covered Properties, including, but not limited to, investment
banking, legal, regulatory, tax, accounting, securities brokerage, property management, real estate, leasing, brokerage and other advisory
and consulting services reasonably necessary for Advisor to perform its duties hereunder (it being understood that the Independent Trustees
and any committees of the Board of Trustees shall retain the authority to hire its or their own attorneys or other advisors);
(vi) cooperating
with the U.S. Advisor in the negotiation, on behalf of the Company, of the terms of loan documents for the Company’s financings,
if any, with respect to any Covered Property;
(vii) coordinating
and managing the operations of any joint venture or co-investment interests held by the Company and conducting and overseeing all matters
with respect to the joint venture or co-investment partners, in each case, with respect to the Covered Properties;
(viii) coordinating
and supervising all property managers, tenant operators, leasing agents and developers for the administration, leasing, management and/or
development of any of the Covered Properties;
(ix) providing
executive and administrative personnel, office space and administrative services required in rendering services to the Company;
(x) administering
bookkeeping and accounting functions as are required for the management and operation of the Company, contracting for audits and preparing
such periodic reports and filings as may be required by any governmental authority in connection with the ordinary conduct of the Company’s
business, and otherwise advising and assisting the Company with its compliance with applicable legal and regulatory requirements, including,
without limitation, periodic reports, returns or statements required under the Exchange Act, the Code and any regulations or rulings thereunder,
the securities and tax statutes of any jurisdiction in which the Company is obligated to file such reports, or the rules and regulations
promulgated under any of the foregoing;
(xi) advising
and assisting in the preparation and filing of all offering documents, registration statements, prospectuses, proxies and other forms
or documents filed with the SEC pursuant to the Securities Act or any state securities regulators (it being understood that the Company
shall be responsible for the content of any and all of its offering documents, SEC filings or state regulatory filings, and that the Advisor
shall not be held liable for any costs or liabilities arising out of any misstatements or omissions in the Company’s offering documents,
SEC filings, state regulatory filings or other filings referred to in this subparagraph, whether or not material (except by reason of
acts constituting bad faith, willful misconduct, gross negligence or reckless disregard of the Advisor’s duties under this Agreement);
(xii) causing
the Company to qualify to do business in all applicable jurisdictions and to obtain and maintain all appropriate licenses, in each case,
with respect to the Covered Properties;
(xiii) handling
and resolving all claims, disputes or controversies (including all litigation, arbitration, settlement or other proceedings or negotiations)
in which the Company may be involved or to which the Company may be subject arising out of the Company’s day-to-day operations,
subject to such limitations or parameters as may be imposed from time to time by the Board of Trustees;
(xiv) using
commercially reasonable efforts to enable expenses incurred by or on behalf of the Company to be within any expense guidelines or budgets
set by the Board of Trustees from time to time;
(xv) using
commercially reasonable efforts to enable the Company to comply with all applicable laws and regulations in all material respects;
(xvi) providing
reasonable assistance to the U.S. Advisor with respect to any of the duties, functions or responsibilities delegated to the U.S. Advisor
under the U.S. Advisory Agreement; and
(xvii) performing
such other services as may be required from time to time for management and other activities relating to the assets of the Company as
the Board of Trustees and the Advisor shall agree from time to time.
Without limiting the foregoing,
the Advisor will also perform portfolio management services on behalf of the Company with respect to the Covered Properties. Such services
will include, but not be limited to, consulting with the Company on the purchase and sale of, and other investment opportunities in connection
with, the Covered Properties; the collection of information and the submission of reports pertaining to the Company’s assets, interest
rates and general economic conditions applicable to the Covered Properties; periodic review and evaluation of the performance of the Covered
Properties; acting as liaison between the Company and banking, mortgage banking, investment banking and other parties with respect to
the purchase, financing and disposition of assets outside of the United States; and other customary functions related to portfolio management.
Additionally, the Advisor will perform monitoring services on behalf of the Company with respect to any services provided by third parties,
which the Advisor determines are material to the performance of the business.
(d) Notwithstanding
anything to the contrary in this Agreement, the Advisor must obtain prior approval by a majority of the Board of Trustees (including a
majority of the Independent Trustees and a majority of the members of the Board of Trustees not involved in the applicable transaction)
(the “Required Approval”) prior to causing the Company to take any of the following actions (subject to any delegation
for which the Required Approval was obtained with respect thereto):
(i) the
entry into, or termination or material modification of, any material transaction related to any Covered Property, including dispositions
and joint ventures;
(ii) the
entry into, or termination or material modification of, any material financing, loan or securities offering transaction of the Company
or its Subsidiaries;
(iii) the
retention of the Company’s independent registered public accountants (which shall also require the prior approval of the Audit Committee
of the Board of Trustees);
(iv) the
entry into, or termination or modification of, any material transaction between the Company, on the one hand, and the Advisor or its Affiliates,
on the other hand;
(v) the
issuance, optional redemption or repurchase of equity or debt securities by the Company or any of its Subsidiaries;
(vi) the
grant, termination or material modification of any equity incentive awards by the Company or any of its Subsidiaries;
(vii) the
entry into, or termination or material modification of any transaction that would constitute a Change in Control; and
(viii) such
other matters as may be determined by the Board of Trustees from time to time.
(e) The
Advisor shall make available sufficient experienced and appropriate personnel to perform the services and functions specified herein.
The Advisor shall not be obligated to dedicate any of its officers or other personnel exclusively to the Company nor is the Advisor, its
Affiliates or any of their officers or other employees obligated to dedicate any specific portion of its or their time to the Company
or its business, except as necessary to perform the services required hereunder.
(f) The
Advisor may retain, for and on behalf, and at the sole cost and expense, of the Company, such services of accountants, legal counsel,
tax counsel, appraisers, insurers, brokers, business developers, transfer agents, registrars, developers, investment banks, financial
advisors, underwriters, banks and other consultants and advisors as the Advisor deems necessary or advisable in connection with the management
and operations of the Covered Properties. Notwithstanding anything contained herein to the contrary, the Advisor shall have the right
to cause any such services to be rendered by its employees or Affiliates (which, for the avoidance of doubt, includes any employees, consultants
or agents of any Affiliate of the Advisor). The Advisor shall further be entitled to reasonably rely on qualified experts hired by the
Advisor, including any of the foregoing.
(g) Subject
to Section 2(d) above, the Advisor may enter into agreements with other parties in connection with its duties hereunder.
(h) Notwithstanding
anything to the contrary contained in this Agreement, it is agreed and understood that the Advisor shall not be responsible for providing
portfolio or asset management services with respect to the real properties owned or controlled by the Company or its Subsidiaries that
are located in the United States, and such other services expressly contemplated by, and pursuant to the terms of, the US Advisory Agreement.
SECTION 3. OTHER ACTIVITIES OF THE ADVISOR
Nothing herein shall prevent
the Advisor or its Affiliates (or their members, officers, directors, employees, agents, representatives, advisors or others) from engaging
in any other business or activities, or from rendering services of any kind to any other Person, including advisory or other services
to others similar to those set forth in this Agreement. The Company recognizes that it is not entitled to preferential treatment in receiving
information, recommendations and other services from the Advisor. The Company and the Board of Trustees acknowledge that the Advisor and/or
one or more of its Affiliates may be or become subject to various conflicts of interest. The Advisor shall act in good faith to endeavor
to identify to the Independent Trustees any conflicts that may arise among the Company, the Advisor and/or any other Person or entity
on whose behalf the Advisor may be engaged.
SECTION 4. AGENCY
The Advisor shall act as agent
of the Company in making, acquiring, financing and disposing of assets of the Company, disbursing and collecting the Company’s funds,
paying the debts and fulfilling the obligations of the Company, supervising the performance of professionals engaged by or on behalf of
the Company and handling, prosecuting and settling any claims of or against the Company, the Board of Trustees, holders of the Company’s
securities or the Company’s representatives or properties.
SECTION 5. BANK ACCOUNTS
The Advisor may establish
and maintain, subject to any applicable conditions or limitations of the loan documents applicable to the Company, one or more bank accounts
in its own name for account of the Company or in the name of the Company or any Subsidiary (any such account, a “Company Account”),
and may collect and deposit funds into any such Company Account or Company Accounts, and disburse funds from any such Company Account
or Company Accounts. The Advisor shall from time to time render appropriate accountings of such collections and payments to the Board
of Trustees and, upon request, to the auditors of the Company or any Subsidiary.
SECTION 6. RECORDS
The Advisor shall maintain
appropriate books of accounts and records relating to services performed under this Agreement, and such books of account and records shall
be accessible for inspection by representatives of the Company at any time during normal business hours upon reasonable advance notice
to the Advisor.
SECTION 7. CONFIDENTIALITY
The Advisor shall keep confidential
any and all non-public information obtained in connection with the services rendered under this Agreement and shall not disclose any such
information to any Person, except to (i) its Affiliates, members, officers, directors, employees, agents, representatives or advisors
who reasonably need such information for the Advisor to be able to perform its duties hereunder (and the US Advisor to carry out its duties
under the US Advisory Agreement, (ii) appraisers, lenders, bankers and other parties as necessary in the ordinary course of the Company’s
business, (iii) in connection with any governmental or regulatory filings or requests of the Company or the Advisor or any of their
Affiliates, (v) as required by applicable law or regulation, including any applicable disclosure requirements applicable to the Company
and the Advisor and their Affiliates under securities or blue sky laws or stock exchange listing requirements, or (vi) with the prior
written consent of the Board of Trustees. The confidentiality provisions of this Section 7 shall survive for a period of three
(3) years after the Termination Date.
SECTION 8. LIMITATION ON ACTIVITIES; INSURANCE
(a) The
Advisor shall refrain from any action that, in its sole judgment made in good faith, (i) can reasonably be expected to result in
the loss of the Company’s status as a REIT under the Code, or to subject the Company to regulation under the Investment Company
Act, or (ii) can reasonably be expected to result in the violation of any law, rule or regulation of any governmental body or
agency having jurisdiction over the Company or any Subsidiary that would materially adversely affect the Company or that would otherwise
not be permitted by such entity’s Governing Instruments. If the Advisor is ordered to take any such action by the Board of Trustees,
the Advisor shall promptly notify the Board of Trustees of the Advisor’s judgment with respect thereto. Notwithstanding the foregoing,
the Advisor and its Affiliates, officers and employees shall not be liable to the Company or any Subsidiary, the Board of Trustees, or
the Company’s or any Subsidiary’s shareholders or partners for any act or omission by the Advisor, its Affiliates, officers
or employees except as provided in Section 11.
(b) The
Advisor shall at all times during the term of this Agreement (including the Initial Term and any Renewal Term) maintain (ii) such
insurance coverage as is customarily maintained by other advisors, managers or servicers of similar assets. No fidelity bond shall be
required,
(c) The
Advisor acknowledges receipt of the Company’s Code of Business Conduct and Ethics, and Policy on Insider Training, and agrees to
require its employees who provide services to the Company to comply with such codes and policies.
SECTION 9. COMPENSATION
The Advisor shall be entitled
to a portion of the Management Fee (as defined in the US Advisory Agreement) payable to the US Advisor, in accordance with the US Advisory
Agreement, which shall be paid to the Advisor by the US Advisor for any such Management Fee in such amount, and on such terms, as may
be agreed between the Advisor and the US Advisor.
SECTION 10. EXPENSES
(a) Administrative
Reimbursement. The Advisor shall be entitled to a portion of the Administrative Reimbursement (as defined in the US Advisory Agreement)
payable to the US Advisor, in accordance with the US Advisory Agreement, which shall be reimbursed to the Advisor by the US Advisor for
any such Administrative Reimbursement in such amount, and on such terms, as may be agreed between the Advisor and the US Advisor.
(b) Advisor
Costs. Except as otherwise expressly provided herein or approved by majority vote of the Independent Trustees or the Audit Committee,
in exchange for the Advisor’s portion of the Administrative Reimbursement, the Advisor shall bear the following expenses incurred
in connection with the performance of its duties under this Agreement, and shall not be entitled to reimbursement with respect to such
expenses (collectively, the “Advisor Costs”):
(i) base
salary, cash incentive compensation and other employment expenses of personnel employed by the Advisor, including, but not limited to,
salaries, wages, payroll taxes and the cost of employee benefit plans (other than equity awards granted by the Company pursuant to an
equity compensation plan approved by the Board of Trustees);
(ii) fees
and travel and other expenses of employees of the Advisor, to the extent not incurred while providing services pursuant to this Agreement;
(iii) rent,
telephone, utilities, office furniture, equipment and machinery (including computers, to the extent utilized) and other office expenses
of the Advisor, except to the extent such expenses relate solely to an office maintained by the Company separate from the offices of the
Advisor; and
(iv) miscellaneous
administrative expenses relating to performance by the Advisor of its obligations hereunder.
(c) Expense
Reimbursement. Except as expressly otherwise provided in this Agreement, the Company shall pay (or shall reimburse the Advisor for)
all of its and its Subsidiaries’ expenses and all costs and expenses associated with the services to be provided pursuant to this
Agreement. Without limiting the generality of the foregoing, it is specifically agreed that the following out-of-pocket expenses of the
Company and its Subsidiaries shall be paid by the Company (or shall be reimbursed by the Company to the Advisor) (collectively, the “Expenses”):
(i) the
cost of borrowed money;
(ii) taxes
on income and taxes and assessments on real and personal property, if any, and all other taxes applicable to the Company or its Subsidiaries;
(iii) legal,
auditing, accounting, underwriting, brokerage, listing, reporting, registration and other fees, and printing, engraving and other expenses
and taxes incurred in connection with the issuance, distribution, transfer, trading, registration and listing of the Company’s or
any of its Subsidiaries’ securities on a stock exchange, including transfer agent’s, registrar’s and indenture trustee’s
fees and charges;
(iv) expenses
of organizing, restructuring, reorganizing or liquidating the Company or any of its Subsidiaries, or of revising, amending, converting
or modifying the Company’s or any of its Subsidiaries’ Governing Instruments;
(v) fees
and travel and other expenses paid to members of the Board of Trustees and officers of the Company or those of individuals in similar
positions with any of its Subsidiaries in their capacities as such (but not in their capacities as officers or employees of the Advisor)
and fees and travel and other expenses paid to advisors, contractors, mortgage servicers, consultants and other agents and independent
contractors employed by or on behalf of the Company and its Subsidiaries (whether or not engaged by the Advisor rather than directly by
the Company);
(vi) expenses
directly connected with the investigation, disposition or ownership of real estate interests or other property (including third party
property diligence costs, appraisal reporting, the costs of foreclosure, insurance premiums, legal services, brokerage and sales commissions,
maintenance, repair, improvement and local management of property), other than expenses with respect thereto of employees of the Advisor,
to the extent that such expenses are to be borne by the Advisor pursuant to this Agreement, including Section 10(b);
(vii) all
insurance costs (including officer and trustee liability insurance) incurred in connection with the Company and its Subsidiaries or in
connection with any officer and trustee indemnity agreement to which the Company or any of its Subsidiaries is a party or arising under
the Company’s or any of its Subsidiaries’ Governing Instruments;
(viii) expenses
connected with payments of distributions, dividends or interest or contributions in cash or any other form made or caused to be made by
the Trustees to holders of securities of the Company or any of its Subsidiaries;
(ix) all
expenses connected with communications to holders of securities of the Company or its Subsidiaries and other administrative work necessary
to maintaining relations with holders of securities, including the proxy solicitation materials and reports to holders of the Company’s
or its Subsidiaries’ securities;
(x) legal,
accounting, auditing and other professional services fees and expenses in addition to those described above;
(xi) filing
and recording fees and costs for regulatory or governmental filings, approvals and notices;
(xii) the
costs and expenses of conceiving, implementing, managing and settling all equity award or compensation plans or arrangements established
by the Company or any of its Subsidiaries, including but not limited to the value of awards made by the Company or any of its Subsidiaries
to members of the Board of Trustees, the Advisor or its employees, if any, and payment of any employment or withholding taxes in connection
therewith; and
(xiii) all
other costs and expenses of the Company and its Subsidiaries, other than those to be specifically borne by the Advisor pursuant to Section 10(b) above.
(d) Invoices
and Payment. All invoicing of, and reimbursement for, the Expenses shall be conducted by the US Advisor pursuant to, and subject to
the terms of, the US Advisory Agreement, and any reimbursable Expenses shall be reimbursed to the Advisor by the US Advisor, in such amounts,
and on such terms, as may be agreed between the Advisor and the US Advisor..
SECTION 11. LIMITATION OF LIABILITY; INDEMNIFICATION
(a) Notwithstanding
anything to the contrary in this Agreement, the Advisor shall have no responsibility under this Agreement other than to render the services
as required under this Agreement in good faith and shall not be responsible for any action of the Board of Trustees in following or declining
to follow any advice or recommendations of the Advisor, including as set forth in Section 8(a). The Advisor, its Affiliates
and their members, managers, officers and employees will not be liable to the Company or any Subsidiary, to the Board of Trustees or to
the Company’s or any Subsidiary’s shareholders or partners for any acts or omissions by the Advisor, its Affiliates, members,
managers, officers or employees pursuant to or in accordance with this Agreement, except by reason of acts constituting bad faith, willful
misconduct or gross negligence.
(b) The
Company shall, to the full extent lawful, reimburse, indemnify and hold the Advisor, its Affiliates, members, managers, officers and employees,
sub-advisors and each other Person, if any, controlling the Advisor or its Affiliates (each, an “Advisor Indemnified Party”),
harmless of and from any and all expenses, losses, damages, liabilities, demands, charges and claims of any nature whatsoever (including
attorneys’ fees) (collectively, “Losses”) in respect of or arising from any acts or omissions of such Advisor
Indemnified Party made in good faith in the performance of the Advisor’s duties under this Agreement and not constituting such Advisor
Indemnified Party’s bad faith, willful misconduct or gross negligence.
(c) The
Advisor shall, to the full extent lawful, reimburse, indemnify and hold the Company, its Subsidiaries, its shareholders, trustees, officers
and employees and each other Person, if any, controlling the Company or its Subsidiaries (each, a “Company Indemnified Party”),
harmless of and from any and all Losses in respect of or arising from any acts or omissions of the Advisor constituting bad faith, willful
misconduct or gross negligence.
(d) Promptly
after receipt by the Advisor Indemnified Party or the Company Indemnified Party, as applicable (the “Indemnified Party”)
of notice of the commencement of any action, such Indemnified Party shall, if a claim in respect thereof is to be made pursuant hereto,
notify the indemnifying party in writing of the commencement thereof; but the omission to so notify the indemnifying party shall not relieve
it from any liability that it may have to any Indemnified Party pursuant to this Section 11. In case any such action shall
be brought against an Indemnified Party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it shall wish, to assume the defense thereof, with counsel satisfactory
to such Indemnified Party and, after notice from the indemnifying party to such Indemnified Party of its election to assume the defense
thereof, the indemnifying party shall not be liable to such Indemnified Party under this Section 11, as applicable, for any
legal expenses of other counsel or any of the expenses, in each case subsequently incurred by such Indemnified Party, unless (i) the
indemnifying party and the Indemnified Party shall have mutually agreed to the retention of such counsel, or (ii) the named parties
to any such proceeding (including any impleaded parties) include both the indemnifying party and Indemnified Party and representation
of both parties by the same counsel would be inappropriate in the reasonable opinion of the Indemnified Party, due to actual or potential
differing interests between them.
(e) The
Company shall be required to advance funds to an Advisor Indemnified Party for legal expenses and other costs incurred as a result of
any legal action or proceeding if a claim in respect thereof is to be made pursuant hereto and if requested by such Advisor Indemnified
Party if (i) such suit, action or proceeding relates to or arises out of, or is alleged to relate to or arise out of or has been
caused or alleged to have been caused in whole or in part by, any action or inaction on the part of the Advisor Indemnified Party in the
performance of its duties or provision of its services on behalf of the Company; and (ii) the Advisor Indemnified Party undertakes
to repay any funds advanced pursuant to this Section 11(e) in cases in which such Indemnified Party would not be entitled
to indemnification under Section 11(b). If advances are required under this Section 11(e), the Advisor Indemnified
Party shall furnish the Company with an undertaking as set forth in clause (ii) of the preceding sentence and shall thereafter have
the right to bill the Company for, or otherwise require the Company to pay, at any time and from time to time after such Advisor Indemnified
Party shall become obligated to make payment therefor, any and all reasonable amounts for which such Advisor Indemnified Party is entitled
to indemnification under this Section 11, and the Company shall pay the same within thirty (30) days after request for payment.
In the event that a determination is made by a court of competent jurisdiction or an arbitrator that the Company is not so obligated in
respect of any amount paid by it to a particular Advisor Indemnified Party, such Advisor Indemnified Party will refund such amount within
sixty (60) days of such determination, and in the event that a determination by a court of competent jurisdiction or an arbitrator is
made that the Company is so obligated in respect to any amount not paid by the Company to a particular Advisor Indemnified Party, the
Company will pay such amount to such Advisor Indemnified Party within thirty (30) days of such final determination, in either case together
with interest at the current prime rate plus two percent (2%) from the date paid until repaid or the date it was obligated to be paid
until the date actually paid.
SECTION 12. NO JOINT VENTURE
Nothing in this Agreement
shall be construed to make the Company and the Advisor partners or joint venturers or impose any liability as such on either of them.
SECTION 13. TERM
This Agreement shall have
an initial term of three (3) years (the “Initial Term”), and shall automatically renew thereafter for successive
one (1) year terms (each a “Renewal Term,” and such term, as renewed, the “Term”) without further
action by either the Company or the Advisor, unless earlier terminated in accordance with the terms of this Agreement.
SECTION 14. TERMINATION
(a) No
later than 180 days prior to the expiration of the Initial Term or any Renewal Term, the Advisor may deliver written notice of its intention
not to renew the term, whereupon the term of this Agreement shall not be renewed and extended, and this Agreement shall terminate effective
on the expiration date of such Initial Term or Renewal Term, as applicable.
(b) The
Company may terminate this Agreement upon 90 days’ prior written notice (a “Company Termination for Convenience”);
provided, however, that, if requested by the Company, the Advisor shall provide transition services (including, without limitation, assistance
with identifying a replacement advisor) to the Company for up to an additional 90 days following the effective date of such Company Termination
for Convenience, which services shall be subject to the same compensation and reimbursements as in effect at the time of such Company
Termination for Convenience is delivered.
(c) The
Company may terminate this Agreement immediately, without prior notice to the Advisor, for Cause.
(d) The
Advisor may terminate this Agreement (i) immediately, without prior notice to the Company, with Good Reason or (ii) effective
concurrently with or within 90 days following the Termination Date (as defined in the US Advisory Agreement) of the US Advisory Agreement
(a “Cross Default Termination”).
SECTION 15. TERMINATION FEE
In the event of a European
Qualifying Termination or a Qualifying Termination (as such term is defined in the US Advisory Agreement), the Advisor shall be entitled
to a portion of any Termination Fee (as defined in the US Advisory Agreement) payable to the US Advisor, in accordance with the US Advisory
Agreement, which shall be paid to the Advisor by the US Advisor for any such Termination Fee in such amount, and on such terms, as may
be agreed between the Advisor and the US Advisor.
SECTION 16. ACTION UPON TERMINATION
(a) From
and after the Termination Date, the Advisor shall not be entitled to compensation for further services under this Agreement, but shall
be paid all compensation accruing through the Termination Date.
(b) On
the Termination Date or as promptly thereafter as practicable, the Advisor shall forthwith:
(i) after
deducting any incurred but unreimbursed Expenses accumulated through the Termination Date due in connection with such termination, pay
over to the Company all money collected and held for the account of the Company or a Subsidiary pursuant to this Agreement;
(ii) deliver
to the Board of Trustees a full accounting, including a statement showing all payments collected and money held by it, covering the period
following the date of the last accounting furnished to the Board of Trustees with respect to the Company or a Subsidiary; and
(iii) deliver
to the Board of Trustees all property and documents of the Company or any Subsidiary then in the custody of the Advisor; provided, however,
that the Advisor may retain copies of all such information.
(c) On
the Termination Date or as promptly thereafter as practicable, the Company shall (to the extent such amounts have not already been deducted
in accordance with Section 16(b)(i) above) forthwith:
(i) reimburse
the Advisor for all incurred but unreimbursed Expenses through the Termination Date pursuant to Section 10(c) above.
SECTION 17. ASSIGNMENT
Neither party may assign this
Agreement or its rights hereunder without the written consent of the other party, except that the Advisor may assign this Agreement (i) to
an Affiliate (only with respect to an entity described in clause (i) of the definition thereof) or other entity whose business and
operations are managed or supervised by WPC, or (ii) to a corporation, partnership, limited liability company, association, trust,
or other entity that is a successor (by merger, consolidation or otherwise) to the Advisor.
SECTION 18. RELEASE OF PROPERTY
(a) The
Advisor agrees that any money or other property of the Company or a Subsidiary thereof held by the Advisor under this Agreement shall
be held by the Advisor as custodian for the Company or such Subsidiary, and the Advisor’s records shall be appropriately marked
clearly to reflect the ownership of such money or other property by the Company or such Subsidiary. Upon the receipt by the Advisor of
a written request from the Board of Trustees requesting the Advisor to release to the Company or any Subsidiary any money or other property
then held by the Advisor for the account of the Company or any Subsidiary under this Agreement, the Advisor shall release such money or
other property to the Company or any Subsidiary within a reasonable period of time, but in no event later than 30 days following such
request. The Advisor shall not be liable to the Company, any Subsidiary, the Board of Trustees or the Company’s or any Subsidiary’s
shareholders or partners for any act or omission by the Company or any Subsidiary in connection with the money or other property released
to the Company or any Subsidiary in accordance with this Section 18.
(b) The
Company agrees to reasonably cooperate with the Advisor to the extent any release of money or other property to the Company or any Subsidiary,
and shall refrain from demanding any such release to the extent doing so may compromise the Company’s operations or Advisor’s
ability to effectively carry out its duties under this Agreement, or that may materially adversely affect the Company or not be permitted
by the Company’s or any Subsidiary’s Governing Instruments. If the Advisor is ordered release any money or other property
in a manner that may be adverse to the Company, as described in the preceding sentence, the Advisor shall promptly notify the Board of
Trustees of the Advisor’s judgment thereof. Notwithstanding the foregoing, the Advisor and its Affiliates, officers and employees
shall not be liable to the Company or any Subsidiary, the Board of Trustees, or the Company’s or any Subsidiary’s shareholders
or partners for any act or omission by the Advisor, its Affiliates, officers or employees except as provided in Section 11.
SECTION 19. NOTICES
Unless expressly provided
otherwise in this Agreement, all notices, requests, demands and other communications required or permitted under this Agreement shall
be in writing and shall be deemed to have been duly given, made and received when delivered against receipt or upon actual receipt of
(i) personal delivery, (ii) delivery by reputable overnight courier, (iii) delivery by email, facsimile transmission or
email against answerback or (iv) delivery by registered or certified mail, postage prepaid, return receipt requested, addressed as
set forth below:
| (a) | If to the Company:
One Manhattan West |
395 Ninth Avenue
New York, NY 10001
Attention: Chief Legal Officer
| (b) | If to the Advisor:
One Manhattan West |
395 Ninth Avenue
New York, NY 10001
Attention: Chief Legal Officer
Either party may alter the
address to which communications or copies are to be sent by giving notice of such change of address in conformity with the provisions
of this Section 19 for the giving of notice.
SECTION 20. SUCCESSORS AND ASSIGNS
This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective heirs, personal representatives, successors and permitted assigns
as provided in this Agreement.
SECTION 21. ENTIRE AGREEMENT
This Agreement contains the
entire agreement and understanding among the parties hereto with respect to the subject matter of this Agreement, 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 of this Agreement. The express terms of this Agreement control and supersede any course of performance
and/or usage of the trade inconsistent with any of the terms of this Agreement. This Agreement may not be modified or amended other than
by an agreement in writing executed by both parties.
SECTION 22. Arbitration
(a) Any
disputes, claims or controversies arising out of or relating to this Agreement, the provision of services by the Advisor pursuant to this
Agreement or the transactions contemplated hereby, including any disputes, claims or controversies brought by or on behalf of the Company
or the Advisor or any holder of equity interests (which, for purposes of this Section 22, shall mean any holder of record
or any beneficial owner of equity interests or any former holder of record or beneficial owner of equity interests) of the Company or
the Advisor, either on his, her or its own behalf, on behalf of the Company or the Advisor or on behalf of any series or class of equity
interests of the Company or the Advisor or holders of any equity interests of the Company or the Advisor against the Company or the Advisor
or any of their respective trustees, directors, members, officers, managers (including the Advisor or its successor), agents or employees,
including any disputes, claims or controversies relating to the meaning, interpretation, effect, validity, performance or enforcement
of this Agreement, including this arbitration agreement or the governing documents of the Company or the Advisor (all of which are referred
to as “Disputes”), or relating in any way to such a Dispute or Disputes shall, on the demand of any party to such Dispute
or Disputes, be resolved through binding and final arbitration in accordance with the Commercial Arbitration Rules (the “Rules”)
of the American Arbitration Association (“AAA”) then in effect, except as those Rules may be modified in this
Section 22. For the avoidance of doubt, and not as a limitation, Disputes are intended to include derivative actions against
the trustees, directors, officers or managers of the Company or the Advisor and class actions by a holder of equity interests against
those individuals or entities and the Company or the Advisor. For the avoidance of doubt, a Dispute shall include a Dispute made derivatively
on behalf of one party against another party. For purposes of this Section 22, the term “equity interest” shall
mean, (i) in respect of the Company, shares of beneficial interest of the Company, and (ii) in respect of the Advisor, “membership
interest” in the Advisor as defined in the Delaware Limited Liability Company Act, as amended.
(b) There
shall be three (3) arbitrators. If there are only two (2) parties to the Dispute, each party shall select one (1) arbitrator
within fifteen (15) days after receipt by respondent of a copy of the demand for arbitration. The arbitrators may be affiliated or interested
persons of the parties. If there are more than two (2) parties to the Dispute, all claimants, on the one hand, and all respondents,
on the other hand, shall each select, by the vote of a majority of the claimants or the respondents, as the case may be, one (1) arbitrator
within fifteen (15) days after receipt of the demand for arbitration. The arbitrators may be affiliated or interested persons of the claimants
or the respondents, as the case may be. If either a claimant (or all claimants) or a respondent (or all respondents) fail(s) to timely
select an arbitrator then the party (or parties) who has selected an arbitrator may request AAA to provide a list of three (3) proposed
arbitrators in accordance with the Rules (each of whom shall be neutral, impartial and unaffiliated with any party) and the party
(or parties) that failed to timely appoint an arbitrator shall have ten (10) days from the date AAA provides the list to select one
(1) of the three (3) arbitrators proposed by AAA. If the party (or parties) fail(s) to select the second (2nd) arbitrator
by that time, the party (or parties) who have appointed the first (1st) arbitrator shall then have ten (10) days to select one (1) of
the three (3) arbitrators proposed by AAA to be the second (2nd) arbitrator; and, if he/they should fail to select the second (2nd)
arbitrator by such time, AAA shall select, within fifteen (15) days thereafter, one (1) of the three (3) arbitrators it had
proposed as the second (2nd) arbitrator. The two (2) arbitrators so appointed shall jointly appoint the third (3rd) and presiding
arbitrator (who shall be neutral, impartial and unaffiliated with any party) within fifteen (15) days of the appointment of the second
(2nd) arbitrator. If the third (3rd) arbitrator has not been appointed within the time limit specified herein, then AAA shall provide
a list of proposed arbitrators in accordance with the Rules, and the arbitrator shall be appointed by AAA in accordance with a listing,
striking and ranking procedure, with each party having a limited number of strikes, excluding strikes for cause.
(c) The
place of arbitration shall be New York, New York, unless otherwise agreed by the parties.
(d) There
shall be only limited documentary discovery of documents directly related to the issues in dispute, as may be ordered by the arbitrators.
For the avoidance of doubt, it is intended that there shall be no depositions and no other discovery other than limited documentary discovery
as described in the preceding sentence.
(e) In
rendering an award or decision (the “Award”), the arbitrators shall be required to follow the laws of the State of
Maryland. Any arbitration proceedings or award rendered hereunder and the validity, effect and interpretation of this arbitration agreement
shall be governed by the Federal Arbitration Act, 9 U.S.C. §1 et seq. The Award shall be in writing and shall state the findings
of fact and conclusions of law on which it is based. Any monetary award shall be made and payable in U.S. dollars free of any tax, deduction
or offset. Subject to Section 22(g), each party against which the Award assesses a monetary obligation shall pay that obligation
on or before the thirtieth (30th) day following the date of the Award or such other date as the Award may provide.
(f) Except
to the extent expressly provided by this Agreement or as otherwise agreed by the parties thereto, each party involved in a Dispute shall
bear its own costs and expenses (including attorneys’ fees), and the arbitrators shall not render an award that would include shifting
of any such costs or expenses (including attorneys’ fees) or, in a derivative case or class action, award any portion of the Company’s
or the Advisor’s, as applicable, award to the claimant or the claimant’s attorneys. Each party (or, if there are more than
two (2) parties to the Dispute, all claimants, on the one hand, and all respondents, on the other hand, respectively) shall bear
the costs and expenses of its (or their) selected arbitrator and the parties (or, if there are more than two (2) parties to the Dispute,
all claimants, on the one hand, and all respondents, on the other hand) shall equally bear the costs and expenses of the third (3rd) appointed
arbitrator.
(g) Notwithstanding
any language to the contrary in this Agreement, the Award, including but not limited to, any interim Award, may be appealed pursuant to
the AAA’s Optional Appellate Arbitration Rules (“Appellate Rules”). The Award shall not be considered final
until after the time for filing the notice of appeal pursuant to the Appellate Rules has expired. Appeals must be initiated within
thirty (30) days of receipt of the Award by filing a notice of appeal with any AAA office. Following the appeal process, the decision
rendered by the appeal tribunal may be entered in any court having jurisdiction thereof. For the avoidance of doubt, and despite any contrary
provision of the Appellate Rules, this Section 22(f) shall apply to any appeal pursuant to this Section 22(f) and
the appeal tribunal shall not render an award that would include shifting of any costs or expenses (including attorneys’ fees) of
any party.
(h) Following
the expiration of the time for filing the notice of appeal, or the conclusion of the appeal process set forth in Section 22(g),
the Award shall be final and binding upon the parties thereto and shall be the sole and exclusive remedy between those parties relating
to the Dispute, including any claims, counterclaims, issues or accounting presented to the arbitrators. Judgment upon the Award may be
entered in any court having jurisdiction. To the fullest extent permitted by law, no application or appeal to any court of competent jurisdiction
may be made in connection with any question of law arising in the course of arbitration or with respect to any award made except for actions
relating to enforcement of this agreement to arbitrate or any arbitral award issued hereunder and except for actions seeking interim or
other provisional relief in aid of arbitration proceedings in any court of competent jurisdiction.
(i) This
Section 22 is intended to benefit and be enforceable by the Company, the Advisor and their respective holders of equity interests,
trustees, directors, officers, managers (including the Advisor or its successor), agents or employees, and their respective successors
and assigns and shall be binding upon the Company, the Advisor and their respective holders of equity interests, and be in addition to,
and not in substitution for, any other rights to indemnification or contribution that such individuals or entities may have by contract
or otherwise.
SECTION 23. GOVERNING LAW
This Agreement and all questions
relating to its validity, interpretation, performance and enforcement shall be governed by and construed, interpreted and enforced in
accordance with the laws of the State of New York, notwithstanding any New York or other conflict-of-law provisions to the contrary.
SECTION 24. NO WAIVERS
Neither the failure nor any
delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof,
nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or
of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence
be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective
unless it is in writing and is signed by the party asserted to have granted such waiver.
SECTION 25. HEADINGS
The titles of paragraphs and
subparagraphs 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 of this Agreement.
SECTION 26. 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. Counterparts may be delivered via facsimile, electronic mail (including
any electronic signature covered by the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act, the Electronic Signatures
and Records Act or other applicable law, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be
deemed to have been duly and validly delivered and be valid and effective for all purposes. This Agreement shall become binding when one
or more counterparts of this Agreement, individually or taken together, shall bear the signatures of all of the parties reflected hereon
as the signatories.
SECTION 27. SURVIVAL
Sections 1, 7, 11, 15, 16,
20, 22, 23, 25 and 27 shall survive the termination hereof. Any termination of this Agreement shall be without prejudice to the rights
of the parties hereto accrued prior to the termination or upon termination.
SECTION 28. Severability
The provisions of this Agreement
are independent of and separable 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.
[Remainder of this page intentionally left
blank]
IN WITNESS WHEREOF, the parties
hereto have executed this Agreement as of the date first written above.
|
COMPANY |
|
|
|
Net Lease Office Properties, |
|
a Maryland real estate trust |
|
|
|
By: |
/s/ Jason E. Fox |
|
|
Name: |
Jason E. Fox |
|
|
Title: |
Chief Financial Officer |
|
|
|
|
|
ADVISOR |
|
|
|
W. P. Carey & Co. B.V., |
|
a Dutch limited liability company |
|
|
|
By: |
/s/ Gregory M. Butchart |
|
|
Name: |
Gregory M. Butchart |
|
|
Title: |
Director A |
|
|
|
By: |
/s/ Ramses van Toor |
|
|
Name: |
Ramses van Toor |
|
|
Title: |
Director B |
[Signature
Page to Advisory Agreement]
Exhibit 99.1
W. P. Carey Announces Completion of Spin-Off
of Net Lease Office Properties
NLOP Common Shares to Begin “Regular Way”
Trading on the NYSE on November 2, 2023
NEW YORK, Nov. 1, 2023 -- W. P. Carey Inc. (W. P. Carey, NYSE:
WPC) today announced that it has completed the previously announced spin-off of 59 office properties (the “Spin-Off”) into
Net Lease Office Properties (“NLOP”), a separate, publicly-traded real estate investment trust that will be listed on the
New York Stock Exchange (“NYSE”) under the symbol “NLOP.”
Under the terms of the Spin-Off, W. P. Carey stockholders received
one NLOP common share for every 15 shares of W. P. Carey common stock held as of the record date of October 19, 2023. W. P. Carey
stockholders will receive cash in lieu of any fractional shares they would otherwise have been entitled to receive in the distribution.
Since October 27, 2023, NLOP common shares have traded on a “when-issued”
basis on the NYSE under the symbol “NLOP WI.” The “when-issued” trading of NLOP ended at the close of market on
November 1, 2023. On November 2, 2023, the “regular way” trading of NLOP common shares will begin on the NYSE under
the symbol “NLOP.” Shares of W. P. Carey will continue to trade under the symbol “WPC.”
J.P. Morgan served as exclusive financial advisor, Latham &
Watkins LLP acted as legal advisor, and Hogan Lovells US LLP acted as legal advisor with respect to tax and Maryland law matters to W.
P. Carey in connection with the Spin-Off.
W. P. Carey Inc.
Celebrating its 50th anniversary,
W. P. Carey ranks among the largest net lease REITs with a well-diversified portfolio of high-quality, operationally critical commercial
real estate, which includes 1,416 net lease properties covering approximately 171 million square feet and a portfolio of 85 self-storage
operating properties, pro forma for the spin-off of NLOP, as of June 30, 2023. With offices in New York, London, Amsterdam and Dallas,
the company remains focused on investing primarily in single-tenant, industrial, warehouse and retail properties located in the U.S. and
Northern and Western Europe, under long-term net leases with built-in rent escalations.
www.wpcarey.com
Net Lease Office Properties
Net Lease Office Properties (NYSE:
NLOP) is a publicly traded real estate investment trust with a portfolio of 59 high-quality office properties, totaling approximately
9.2 million leasable square feet primarily leased to corporate tenants on a single-tenant net lease basis. The vast majority of the office
properties owned by NLOP are located in the U.S., with the balance in Europe. The portfolio consists of 62 corporate tenants operating
in a variety of industries, generating annualized based rent of more than $141 million as of June 30, 2023. NLOP’s business
plan is focused on realizing value for its shareholders primarily through strategic asset management and disposition of its property portfolio
over time.
www.nloproperties.com
Cautionary Statement Concerning
Forward-Looking Statements
Certain of the matters discussed in this communication constitute
forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, both as amended
by the Private Securities Litigation Reform Act of 1995. The forward-looking statements include, among other things, statements regarding
the intent, belief or expectations of W. P. Carey and NLOP and can be identified by the use of words such as “may,” “will,”
“should,” “would,” “will be,” “goals,” “believe,” “project,”
“expect,” “anticipate,” “intend,” “estimate” “opportunities,” “possibility,”
“strategy,” “maintain” or the negative version of these words and other comparable terms. These forward-looking
statements include, but are not limited to, statements regarding the trading of NLOP common shares on the NYSE and NLOP’s business
plan. These statements are based on the current expectations of W. P. Carey’s and NLOP’s management, and it is important
to note that W. P. Carey’s and NLOP’s actual results could be materially different from those projected in such forward-looking
statements. There are a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking
statements. Other unknown or unpredictable risks or uncertainties, like the risks related to inflation and increased interest rates,
the effects of pandemics and global outbreaks of contagious diseases (such as the COVID-19 pandemic) and domestic or geopolitical crises,
such as terrorism, military conflict (including the ongoing conflict between Russia and Ukraine and the global response to it), war or
the perception that hostilities may be imminent, political instability or civil unrest, or other conflict, and those additional risk
factors discussed in reports that W. P. Carey and NLOP have filed with the SEC, could also have material adverse effects on W. P. Carey
and NLOP’s future results, performance or achievements. Discussions of some of these other important factors and assumptions are
contained in W. P. Carey’s and NLOP’s filings with the SEC and are available at the SEC’s website at http://www.sec.gov,
including Part I, Item 1A. Risk Factors in W. P. Carey's Annual Report on Form 10-K for the fiscal year ended December 31,
2022 and the risk factors listed under the caption “Risk Factors” in NLOP’s Registration Statement on Form 10
filed with the SEC on October 4, 2023, the final version of which was included as Exhibit 99.1 to NLOP’s Current Report
on Form 8-K/A filed with the SEC on October 11 ,2023. Investors are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this communication, unless noted otherwise. Except as required under the federal securities
laws and the rules and regulations of the SEC, W. P. Carey and NLOP do not undertake any obligation to release publicly any revisions
to the forward-looking statements to reflect events or circumstances after the date of this communication or to reflect the occurrence
of unanticipated events.
Institutional Investors:
Peter Sands
1 (212) 492-1110
institutionalir@wpcarey.com
Individual Investors:
W. P. Carey Inc.
1 (212) 492-8920
ir@wpcarey.com
Press Contact:
Anna McGrath
1 (212) 492-1166
amcgrath@wpcarey.com
v3.23.3
Cover
|
Oct. 31, 2023 |
Cover [Abstract] |
|
Document Type |
8-K
|
Amendment Flag |
false
|
Document Period End Date |
Oct. 31, 2023
|
Entity File Number |
001-13779
|
Entity Registrant Name |
W. P. Carey Inc.
|
Entity Central Index Key |
0001025378
|
Entity Tax Identification Number |
45-4549771
|
Entity Incorporation, State or Country Code |
MD
|
Entity Address, Address Line One |
One Manhattan West
|
Entity Address, Address Line Two |
395 9th Avenue
|
Entity Address, Address Line Three |
58th Floor
|
Entity Address, City or Town |
New York
|
Entity Address, State or Province |
NY
|
Entity Address, Postal Zip Code |
10001
|
City Area Code |
212
|
Local Phone Number |
492-1100
|
Written Communications |
false
|
Soliciting Material |
false
|
Pre-commencement Tender Offer |
false
|
Pre-commencement Issuer Tender Offer |
false
|
Title of 12(b) Security |
Common Stock, $0.001 Par Value
|
Trading Symbol |
WPC
|
Security Exchange Name |
NYSE
|
Entity Emerging Growth Company |
false
|
X |
- DefinitionBoolean flag that is true when the XBRL content amends previously-filed or accepted submission.
+ References
+ Details
Name: |
dei_AmendmentFlag |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionFor the EDGAR submission types of Form 8-K: the date of the report, the date of the earliest event reported; for the EDGAR submission types of Form N-1A: the filing date; for all other submission types: the end of the reporting or transition period. The format of the date is YYYY-MM-DD.
+ References
+ Details
Name: |
dei_DocumentPeriodEndDate |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:dateItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe type of document being provided (such as 10-K, 10-Q, 485BPOS, etc). The document type is limited to the same value as the supporting SEC submission type, or the word 'Other'.
+ References
+ Details
Name: |
dei_DocumentType |
Namespace Prefix: |
dei_ |
Data Type: |
dei:submissionTypeItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionAddress Line 1 such as Attn, Building Name, Street Name
+ References
+ Details
Name: |
dei_EntityAddressAddressLine1 |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionAddress Line 2 such as Street or Suite number
+ References
+ Details
Name: |
dei_EntityAddressAddressLine2 |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionAddress Line 3 such as an Office Park
+ References
+ Details
Name: |
dei_EntityAddressAddressLine3 |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- Definition
+ References
+ Details
Name: |
dei_EntityAddressCityOrTown |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionCode for the postal or zip code
+ References
+ Details
Name: |
dei_EntityAddressPostalZipCode |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionName of the state or province.
+ References
+ Details
Name: |
dei_EntityAddressStateOrProvince |
Namespace Prefix: |
dei_ |
Data Type: |
dei:stateOrProvinceItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionA unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityCentralIndexKey |
Namespace Prefix: |
dei_ |
Data Type: |
dei:centralIndexKeyItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionIndicate if registrant meets the emerging growth company criteria.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityEmergingGrowthCompany |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionCommission file number. The field allows up to 17 characters. The prefix may contain 1-3 digits, the sequence number may contain 1-8 digits, the optional suffix may contain 1-4 characters, and the fields are separated with a hyphen.
+ References
+ Details
Name: |
dei_EntityFileNumber |
Namespace Prefix: |
dei_ |
Data Type: |
dei:fileNumberItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionTwo-character EDGAR code representing the state or country of incorporation.
+ References
+ Details
Name: |
dei_EntityIncorporationStateCountryCode |
Namespace Prefix: |
dei_ |
Data Type: |
dei:edgarStateCountryItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityRegistrantName |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe Tax Identification Number (TIN), also known as an Employer Identification Number (EIN), is a unique 9-digit value assigned by the IRS.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityTaxIdentificationNumber |
Namespace Prefix: |
dei_ |
Data Type: |
dei:employerIdItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionLocal phone number for entity.
+ References
+ Details
Name: |
dei_LocalPhoneNumber |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 13e -Subsection 4c
+ Details
Name: |
dei_PreCommencementIssuerTenderOffer |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 14d -Subsection 2b
+ Details
Name: |
dei_PreCommencementTenderOffer |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionTitle of a 12(b) registered security.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b
+ Details
Name: |
dei_Security12bTitle |
Namespace Prefix: |
dei_ |
Data Type: |
dei:securityTitleItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionName of the Exchange on which a security is registered.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection d1-1
+ Details
Name: |
dei_SecurityExchangeName |
Namespace Prefix: |
dei_ |
Data Type: |
dei:edgarExchangeCodeItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Section 14a -Number 240 -Subsection 12
+ Details
Name: |
dei_SolicitingMaterial |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionTrading symbol of an instrument as listed on an exchange.
+ References
+ Details
Name: |
dei_TradingSymbol |
Namespace Prefix: |
dei_ |
Data Type: |
dei:tradingSymbolItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 425
+ Details
Name: |
dei_WrittenCommunications |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
WP Carey (NYSE:WPC)
Historical Stock Chart
From Apr 2024 to May 2024
WP Carey (NYSE:WPC)
Historical Stock Chart
From May 2023 to May 2024