Sales Agency Agreement

50 ROCKEFELLER PLAZA
NEW YORK, NY 10020
SALES AGENCY AGREEMENT


October ____, 2002


Carey Financial Corporation 50 Rockefeller Plaza New York, NY 10020


Ladies and Gentlemen:


Corporate Property Associates 15 Incorporated, a Maryland corporation (the "Company"), hereby confirms its agreement with you as follows:


1. Introduction. This Sales Agency Agreement (the "Agreement") sets forth the understandings and agreements between the Company and you whereby you will offer and sell on a best efforts basis for the account and risk of the Company, along with a group of selected dealers (the "Selected Dealers") and registered investment advisors (the "Selected Investment Advisors") to be formed with your assistance, shares of common stock of the Company registered on Form S-11 (the "Shares") at $10 per share (subject to certain volume discounts).


2. Representations and Warranties of the Company


The Company represents, warrants and agrees that:


(a) Registration Statement and Prospectus. The Company has filed with the Securities and Exchange Commission (the "Commission") a registration statement on Form S-11 (File No. 333-xxxxx), containing a related preliminary prospectus, for the registration of the Shares under the Securities Act of 1933, as amended (the "Securities Act") and the regulations thereunder (the "Regulations"), and will prepare and file with the Commission any amendments to the registration statement necessary for them to become effective, including an amended preliminary prospectus. The registration statement, as amended, and the amended prospectus on file with the Commission at the time the registration statement becomes effective (including financial statements, exhibits and all other documents related thereto filed as a part thereof or incorporated therein), and any registration statement filed under Rule 462(b) of the Securities Act, are herein called the "Registration Statement" and the "Prospectus," respectively, except that if the Registration Statement is amended by a post-effective amendment, the term "Registration Statement" shall, from and after the declaration of effectiveness of such post-effective amendment, refer to the Registration Statement as so amended and the term "Prospectus" shall refer to the prospectus as so amended, and if the Prospectus filed by the Company pursuant to Rule 424(b) or 424(c) of the Regulations shall differ from the Prospectus on file at the time the Registration Statement or any post-effective amendment shall become effective, the term "Prospectus" shall refer to the Prospectus filed pursuant to either of such Rules from and after the date on which it shall have been mailed for filing with the Commission. Further, if a separate prospectus is filed and becomes effective with respect solely to the DRIP (a "DRIP Prospectus"), the term "Prospectus" shall refer to such DRIP Prospectus from and after the declaration of effectiveness of such DRIP Prospectus.


(b) Compliance with the Act. The Registration Statement has been prepared and filed by the Company in conformity with the Act and the applicable instructions and Regulations. The Commission has not issued any order preventing or suspending the use of any prospectus or preliminary prospectus filed with the Registration Statement or any amendments thereto. At the time the Registration Statement becomes effective (the "Effective Date") and at the time that any post-effective amendments thereto become effective and at all times subsequent thereto up to the Termination Date (as defined in Section 3(d) hereof), the Registration Statement and Prospectus (as amended or as supplemented) will contain all statements which are required to be stated therein in accordance with the Act and the Regulations and will in all respects conform to the requirements of the Act and the Regulations, and will not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, and each preliminary prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Act, complied when so filed in all material respects with the Act and Regulations and did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.


(c) The Company. The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Maryland with full power and authority to conduct the business in which it is engaged in as described in the Prospectus. The Company is duly qualified to do business as a foreign corporation and is in good standing in each other jurisdiction in which it owns or leases property of a nature, or transacts business of a type, that would make such qualification necessary.


(d) The Shares. The Shares, when issued, will be duly and validly issued, fully paid and non-assessable and will conform to the description thereof contained in the Prospectus; no holder thereof will be subject to personal liability for the obligations of the Company solely by reason of being such a holder; such Shares are not subject to the preemptive rights of any shareholder of the Company; and all corporate action required to be taken for the authorization, issue and sale of such Shares has been validly and sufficiently taken.


(e) Violations. The Company is not in violation of its Articles of Incorporation ("Articles") or Bylaws or in default in the performance or observance of any material obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, loan agreement, note, lease or other agreement or instrument to which it is a party or by which it or any of its properties is bound.


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(f) Taxes. The Company has filed all Federal, state and foreign income tax returns which have been required to be filed on or before the due date (taking into account all extensions of time to file) and has paid or provided for the payment of all taxes indicated by said returns and all assessments received by the Company to the extent that such taxes or assessment have become due.


(g) Pending Action. There is no action, suit or proceeding pending or, to the best of the knowledge, information and belief of the Company, threatened to which the Company is a party, before or by any court or governmental agency or body.


(h) Financial Statements. The financial statements of the Company filed as part of the Registration Statement and those included in the Prospectus present fairly the financial position of the Company as of the date indicated and the results of its operations for the periods specified; said financial statements have been prepared in conformity with generally accepted accounting principles applied on a consistent basis; and PricewaterhouseCoopers LLP, whose report is filed with the Commission as a part of the Registration Statement, are independent accountants as required by the Act and the Regulations.


(i) No Subsequent Material Events. Since the respective dates as of which information is given in the Registration Statement and the Prospectus, except as may otherwise be stated in or contemplated by the Registration Statement and the Prospectus, (a) there has not been any material adverse change in the condition (financial or otherwise) of the Company or in the earnings, affairs or business prospects of the Company, whether or not arising in the ordinary course of business, and (b) there have not been any material transactions entered into by the Company except in the ordinary course of business.


(j) Investment Company Act. The Company does not intend to conduct its business so as to be an "investment company" as that term is defined in the Investment Company Act of 1940, as amended and the rules and regulations thereunder, and it will exercise reasonable diligence to ensure that it does not become an "investment company" within the meaning of the Investment Company Act of 1940.


(k) Authorization of Agreement. This Agreement and the Advisory Agreement (the "Advisory Agreement") between the Company and Carey Asset Management Corp. (the "Advisor") have been duly and validly authorized, executed and delivered by the Company and constitute the valid agreements of the Company enforceable in accordance with their terms. The execution and delivery of this Agreement and the Advisory Agreement, the consummation of the transactions herein and therein contemplated and the compliance with the terms of this Agreement and the Advisory Agreement by the Company will not conflict with or constitute a default under the Articles or bylaws or any indenture, mortgage, deed of trust, lease or other agreement or instrument to which the Company is a party, or any law, order, rule or regulation, writ, injunction or decree of any government, governmental instrumentality or court, domestic or foreign, having jurisdiction over the Company, or any of its property, except to the extent that the enforceability of the indemnity and/or contribution provisions contained in Section 8 of this Agreement may be limited under applicable securities law; and no consent, approval,


3 authorization or order of any court or other governmental agency or body has been or is required for the performance of this Agreement or the Advisory Agreement by the Company, or for the consummation of the transactions contemplated hereby and thereby (except such as have been obtained under the Act or as may be required under state securities or "blue sky" laws in connection with the distribution of the Shares).


(l) Description of Agreements. The Company is not a party to or bound by any contract or other instrument of a character required to be described in the Registration Statement or the Prospectus or to be filed as an exhibit to the Registration Statement that is not described and filed as required.


(m) Qualification as a Real Estate Investment Trust. The Company intends to satisfy the requirements of the Internal Revenue Code of 1986 as amended (the "Code") for qualification of the Company as a real estate investment trust. The Company has elected to be treated as a real estate investment trust under the Code and will direct the investment of the proceeds of the offering of the Shares in such a manner, and will otherwise operate the business of the Company, so as to comply with such requirements.


(n) Description of Properties. On the Effective Date and at all times subsequent thereto up to the Termination Date, the section of the Prospectus entitled "Description of Properties" will include, among other things, the location and general character of all materially important real properties held or intended to be acquired by the Company, the nature of the Company's title to or other interest in such properties and the nature and amount of all material mortgages or other liens or encumbrances against such properties and the principal terms of any lease of any such properties and the lessee thereof and such descriptions will be correct in all material respects.


(o) Gramm-Leach-Bliley Act and USA Patriot Act. The Company complies with the applicable privacy provision of the Gramm-Leach-Bliley Act and the applicable provisions of the USA Patriot Act, in all material respects.


3. Sales of Shares. On the basis of the representations, warranties and covenants herein contained, but subject to the terms and conditions herein set forth, the Company hereby appoints you as its sales agent ("Sales Agent") to solicit purchasers, along with the Selected Dealers and Selected Investment Advisors (as defined in Section 3(c)), for the Shares during the period (the "Effective Term") from the Effective Date to the Termination Date, including the Shares pursuant to the DRIP (registered on Form S-11, Registration No. 333-5584), each in the manner described in the Registration Statement. Subject to the performance by the Company of all obligations to be performed by it hereunder and the completeness and accuracy of all of its representations and warranties, you agree to use your best efforts as Sales Agent, promptly following written or telegraphic receipt of notice of the Effective Date from the Company, to offer and sell such number of Shares as contemplated by this Agreement at the price stated in the Prospectus.


(a) Purchase of Shares. The purchase of Shares must be made during the offering period described in the Prospectus, or after such offering period in the case of purchases made pursuant to the DRIP (each such purchase hereinafter defined as an "Order"). Persons desiring to


4 purchase Shares are required to (i) deliver to you, the appropriate Selected Dealer or Selected Investment Advisor a check in the amount of $10 per Share purchased (subject to certain volume discounts or other discounts as described in the prospectus, or such other per share price as may be applicable pursuant to the DRIP) payable to The Bank of New York, as escrow agent (the "Escrow Agent"), or (ii) authorize a debit of such amount to the account such purchaser maintains with you, the appropriate Selected Dealer or Selected Investment Advisor. For investors residing in certain states, an order form in the form attached to the Prospectus (each an "Order Form") must be completed and submitted to the Company. On a daily basis, you will submit all checks received from investors and transfer, via Federal Reserve bank wire, the total amount debited from investor accounts for the purchase of Shares along with a list including the name, address and telephone number of, the social security number or taxpayer identification number of, the brokerage account number of (if applicable), the number of Shares purchased by, any election to participate in the DRIP by, and the total dollar amount of investment by, each investor on whose behalf checks are submitted or the wire transfer is made. You also will forward all Order Forms to the Company. You shall use your best efforts to wire such funds or transmit checks to the Escrow Agent not later than noon of the next business day after receipt by you from your customer of each Order. You will advise the Escrow Agent whether the funds you are submitting are attributable to individual retirement accounts, Keogh plans, or any other employee benefit plan subject to Title I of the Employee Retirement Income Security Act of 1974 or from some other type of investor.


All Orders solicited by you will be strictly subject to review and acceptance by the Company and the Company reserves the right in its absolute discretion to reject any Order or to accept or reject Orders in the order of their receipt by the Company or otherwise. Within 30 days of receipt of an Order, the Company must accept or reject such Order. If the Company elects to reject such Order, within 10 business days after such rejection, it will notify the purchaser of such fact and cause the return of such purchaser's funds submitted with such application and any interest earned thereon. If no notice of rejection is received by you within the foregoing time limits or if funds submitted by the purchaser are released from escrow to the Company within the foregoing time limits, the Order shall be deemed accepted. You agree to make every reasonable effort to determine that the purchase of Shares is a suitable and appropriate investment for each potential purchaser of Shares based on information provided by such purchaser regarding such purchaser's financial situation and investment objectives. You agree to maintain, for at least six years, records of the information used by you to determine whether an investment in Shares is suitable and appropriate for a potential purchaser of Shares.


(b) Closing Dates and Delivery of Shares. In no event shall a sale of shares to an investor be completed until at least five business days after the date the investor receives a copy of the Prospectus. On the date Shares are first issued to Shareholders (such date being herein referred to as the "Initial Closing Date"), the Escrow Agent will at such time and place as instructed by you and the Company (which instruction shall be subject to the satisfaction on such date of the conditions contained herein), deliver to the Company or its designee immediately available funds in an amount equal to the Escrow Funds on deposit in the Escrow Account prior to the date designated by the Company. If, after the Initial Closing Date, additional sales of Shares are made, on each such date (each such date being referred to as an "Additional Closing


5 Date") and at each such time and place as instructed by you and the Company (which instruction shall be subject to the satisfaction on each such date of the conditions contained herein), the Escrow Agent shall be required to deliver to the Company or its designee immediately available funds in an amount equal to the Escrow Funds on deposit in the Escrow Account prior to the date specified by the Company. The Initial Closing Date and each Additional Closing Date are each herein referred to as a "Closing Date." Closing dates for purchases made pursuant to the DRIP will be as set forth in the DRIP.


(c) Selected Dealers and Selected Investment Advisors. The Shares offered and sold under this Agreement shall be offered and sold only by you as Sales Agent and by a selling group of brokers or dealers (the "Selected Dealers"), all of whom must be members in good standing of the National Association of Securities Dealers, Inc. (the "NASD"), who execute Selected Dealer Agreements with you substantially in the form attached hereto as Exhibit A, and Selected Investment Advisors, who execute Selected Investment Advisor Agreements substantially in the form attached hereto as Exhibit B, all of whom are acceptable to the Company and you (which acceptance shall not be unreasonably withheld by you). You will assist the Company in forming the selling group of Selected Dealers and Selected Investment Advisors. No firm shall be invited to join the selling group of Selected Dealers or Selected Investment Advisors if it is (i) currently subject to any suspension or expulsion pursuant to the rules and regulations of the Commission, the state securities commissions of any of the fifty states, the New York Stock Exchange, Inc. or the American Stock Exchange, Inc. as those rules and regulations relate to broker-dealers and registered investment advisors, or the rules and regulations of the NASD or (ii) a "discount broker" as that term is commonly understood in the brokerage industry. The Company and the Advisor or an affiliate thereof agree to participate in your marketing efforts to the extent that you may reasonably request and, without limiting the generality of the foregoing, agree to visit the offices of Selected Dealers and Selected Investment Advisors as you may reasonably designate.


(d) Compensation. In consideration for your execution of this Agreement, and for the performance of your obligations hereunder, the Company agrees to pay or cause to be paid to you a selling commission (the "Selling Commission") of six and one-half percent ($0.65) of the price of each Share (except for Shares sold pursuant to the DRIP) sold by you or by a Selected Dealer, provided that no commissions shall be paid for shares sold by Selected Investment Advisors; provided further, however, that your Selling Commission shall be reduced with respect to volume sales of Shares to "Single Purchasers" (as defined in the Prospectus). In the case of such volume sales to Single Purchasers, on orders of $250,000 or more your Selling Commission shall be reduced by the amount of the Share purchase price discount. In the case of such volume sales to Single Purchasers, your selling commission will be reduced for each incremental share purchase in the total volume ranges set forth in the table below. Such reduced share price will not affect the amount received by the Company for investment. The following table sets forth the reduced Share purchase price and Selling Commission payable to you:


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PURCHASE PRICE PER SELLING COMMISSION PER
VOLUME DISCOUNT SHARE FOR INCREMENTAL SHARE ON TOTAL SALE FOR
RANGE FOR A SHARE IN VOLUME INCREMENTAL SHARE IN
SINGLE PURCHASER DISCOUNT RANGE VOLUME DISCOUNT RANGE
---------------- -------------- ---------------------
$ 2,000 - $ 250,000 $10.00 $0.65
$ 250,001 - $ 500,000 $ 9.85 $0.50
$ 500,001 - $ 750,000 $ 9.70 $0.35
$ 750,001 - $1,000,000 $ 9.60 $0.25
$1,000,001 - $5,000,000 $ 9.50 $0.15


As an example, a single purchaser would receive 50,380 Shares rather than 50,000 Shares for his/her or its investment of $500,000 and the Selling Commission would be $28,940. On the first $250,000 of the investment there would be no discount and the purchaser would receive 25,000 shares at $10 per share. On the remaining $250,000, the per share price would be $9.85 and the purchaser would receive 25,380 shares.


A refund will be made to the purchaser for any fractional Shares based on the public offering price if such refund is in excess of $1.00. In the foregoing example, $7.00 would be refunded for the fractional Share.


Selling Commissions for purchases of $5,000,000 or more are negotiable but in no event will the proceeds to the Company be less than $9.35 per Share. Selling Commissions paid will in all cases be the same for the same level of sales.


Notwithstanding the foregoing, Selling Commissions for all purchases made by an investor pursuant to the DRIP shall be five percent of the purchase price of each Share purchased pursuant to the DRIP.


The Company will pay to you for reallowance to Selected Dealers only, the amount of any due diligence expense reimbursement paid to the Selected Dealers which you have agreed to pay in the amount of up to one-half percent of the price of each Share sold by each Selected Dealer to which you have agreed to pay such a fee.


From your total commissions, you agree to reallow to each Selected Dealer with whom you have entered into a Selected Dealer Agreement (no such reallowance will be made for Selected Investment Advisors) an amount of up to $0.65 commission per Share (except in the case of Shares purchased under the DRIP in which case the commission reallowance will be an amount up to $0.50 per Share) for Shares sold by the Company pursuant to Orders solicited by such Selected Dealer and the full amount of any Selected Dealer Fee paid to you by the Company on behalf of any Selected Dealer. The Company will also reimburse you for the amount of the Selected Dealer Fee paid to Selected Dealers, which fee will be one percent of the price of each Share sold by the Selected Dealer. Additionally, the Company will pay to you the Selected Dealer Fee of one percent for Shares sold directly by you. No payment of commissions will be made by the Company with respect to Orders placed by the Selected Investment Advisors and Orders (or portions thereof) which are rejected by the Company. Finally, the Company will


7 pay you a one-half percent marketing fee, which you may reallow, in your sole discretion, to the Selected Dealers based on such factors as volume of Shares sold, marketing support and bona fide conference fees incurred. Purchases of Shares by the Advisor, its Affiliates (as defined in the Prospectus), any ...