DUTIES OF DEALER a. Dealer agrees to purchase Shares only from Distributor or from Dealer's customers.
b. Dealer agrees to enter orders for the purchase of Shares only from Distributor and only for the purpose of covering purchase orders Dealer has already received from its customers or for Dealer's own bona fide investment.
c. Dealer agrees to date and time stamp all orders received by Dealer and promptly, upon receipt of any and all orders, to transmit to Distributor all orders received prior to the time described in the Prospectus for the calculation of each Fund's net asset value so as to permit Distributor to process all orders at the price next determined after receipt by Dealer, in accordance with the Prospectus. Dealer agrees not to withhold placing orders for Shares with Distributor so as to profit itself as a result of such inaction.
d. Dealer agrees to maintain records of all purchases and sales of Shares made through Dealer and to furnish Distributor or regulatory authorities with copies of such records upon request. In that regard, Dealer agrees that, unless Dealer holds Shares as nominee for its customers or participates in the NSCC Fund/Serv Networking program, at certain matrix levels, it will provide Distributor with all necessary information to comply properly with all federal, state and local reporting requirements and backup and nonresident alien withholding requirements for its customer accounts including, without limitation, those requirements that apply by treating Shares issued by the Funds as readily tradable instruments. Dealer represents and agrees that all Taxpayer Identification Numbers ("TINs") provided are certified, and that no account that requires a certified TIN will be established without such certified TIN. With respect to all other accounts, including Shares held by Dealer in omnibus accounts and Shares purchased or sold through the NSCC Fund/Serv Networking program, at certain matrix levels, Dealer agrees to perform all federal, state and local tax reporting with respect to such accounts, including without limitation redemptions and exchanges.
e. Dealer agrees to distribute or cause to be delivered to its customers Prospectuses, proxy solicitation materials and related information and proxy cards, semi-annual and annual shareholder reports and any other materials in compliance with applicable legal requirements, except to the extent that Distributor expressly undertakes to do so in writing.
f. Dealer agrees that if any Share is repurchased by any Fund or is tendered for redemption within seven (7) business days after confirmation by Distributor of the original purchase order from Dealer, Dealer shall forfeit its right to any concession or commission received by Dealer with respect to such Share and shall forthwith refund to Distributor the full concession allowed to Dealer or commission paid to Dealer on the original sale. Distributor agrees to notify Dealer of such repurchase or redemption within a reasonable time after settlement. Termination or cancellation of this Agreement shall not relieve Dealer from its obligation under this provision.
g. Dealer agrees that payment for Shares ordered from Distributor shall be in Fed Funds, New York clearinghouse or other immediately available funds and that such funds shall be received by Distributor by the earlier of: (i) the end of the third (3rd) business day following Dealer's receipt of the customer's order to purchase such Shares; or (ii) the settlement date established in accordance with Rule 15c6-1 under the Securities Exchange Act of 1934, as amended. If such payment is not received by Distributor by such date, Dealer shall forfeit its right to any concession or commission with respect to such order, and Distributor reserves the right, without notice, forthwith to cancel the sale, or, at its option, to sell the Shares ordered back to the Fund, in which case Distributor may hold Dealer responsible for any loss, including loss of profit, suffered by Distributor resulting from Dealer's failure to make payment as aforesaid. If a purchase is made by check, the purchase is deemed made upon conversion of the purchase instrument into Fed Funds, New York clearinghouse or other immediately available funds.
h. Dealer agrees that it: (i) shall assume responsibility for any loss to the Fund caused by a correction to any order placed by Dealer that is made subsequent to the trade date for the order, provided such order correction was not based on any negligence on Distributor's part; and (ii) will immediately pay such loss to the Fund upon notification.
i. Dealer agrees that in connection with orders for the purchase of Shares on behalf of any IRAs, 401(k) plans or other retirement plan accounts, by mail, telephone, or wire, Dealer shall act as agent for the custodian or trustee of such plans (solely with respect to the time of receipt of the application and payments), and Dealer shall not place such an order with Distributor until it has received from its customer payment for such purchase and, if such purchase represents the first contribution to such a retirement plan account, the completed documents necessary to establish the retirement plan. Dealer agrees to indemnify Distributor and its affiliates for any claim, loss, or liability resulting from incorrect investment instructions received by Distributor from Dealer.
j. Dealer agrees that it will not make any conditional orders for the purchase or redemption of Shares and acknowledges that Distributor will not accept conditional orders for Shares.
k. Dealer agrees that all out-of-pocket expenses incurred by it in connection with its activities under this Agreement will be borne by Dealer.
l. Dealer agrees that it will keep in force appropriate broker's blanket bond insurance policies covering any and all acts of Dealer's partners, directors, officers, employees, and agents adequate to reasonably protect and indemnify the Distributor and the Funds against any loss which any party may suffer or incur, directly or indirectly, as a result of any action by Dealer or Dealer's partners, directors, officers, employees, and agents.
m. Dealer agrees that it will maintain the required net capital as specified by the rules and regulations of the SEC, NASD and other regulatory authorities.
Obligations and Compensation of Dealer Manager a. The Company hereby appoints the Dealer Manager as its agent and principal distributor for the purpose of selling for cash to the public up to the maximum amount of Shares set forth in the Prospectus (subject to the Company’s right of reallocation, as described in the Prospectus) primarily through the Offering Participants. The Company hereby expressly authorizes the Dealer Manager to engage one or more Sub-Dealer Managers in connection with the performance of its roles and responsibilities as agent and distributor set forth hereunder. The Dealer Manager hereby accepts such agency and distributorship and agrees to use its best efforts to sell the Shares primarily through the Offering Participants on said terms and conditions set forth in the Prospectus with respect to each Offering and any additional terms or conditions specified in Schedule 2 to this Agreement, as it may be amended from time to time. The Dealer Manager represents to the Company that it is a member in good standing of FINRA and that it and its employees and representatives have all required licenses and registrations to act under this Agreement. With respect to the Dealer Manager’s participation in the distribution of the Shares in the Offering, including with respect to its engagement of one or more Sub-Dealer Managers, the Dealer Manager agrees to comply in all material respects with the applicable requirements of the Securities Act, the Rules and Regulations, the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations promulgated thereunder, and all other state or federal laws, rules and regulations applicable to the Offering and the sale of Shares, all applicable state securities or blue sky laws and regulations, and the rules of FINRA applicable to the Offering, from time to time in effect, including, without limitation, FINRA Rules 2040, 2111, 2310, 5110 and 5141. The Dealer Manager will not make any recommendations to retail investors that would subject the Dealer Manager to compliance with Regulation Best Interest.
b. As soon as practicable after the initial Effective Date of the Registration Statement, but in no event prior to the Company instructing the Dealer Manager and the Offering Participant to commence such Offering, the Dealer Manager Parties and the Offering Participants shall commence the offering of the Shares in the Offering for cash to the public in jurisdictions in which the Shares are registered or qualified for sale or in which such offering is otherwise permitted. The Dealer Manager Parties and the Offering Participants will immediately suspend or terminate offering of the Shares upon request of the Company at any time and will resume offering the Shares upon subsequent request of the Company.
c. Subject to volume discounts and other special circumstances described in or otherwise provided in this Agreement and under the caption “Plan of Distribution” in the Prospectus, which may be amended, restated or supplemented from time to time, the Company will pay to the Dealer Manager selling commissions in connection with sales of Class T Primary Shares, Class S Primary Shares and Class D Primary Shares, as described in Schedule 2 to this Agreement. The applicable selling commissions payable to the Dealer Manager will be paid substantially concurrently with the execution by the Company of orders submitted by purchasers of Class T Primary Shares, Class S Primary Shares and Class D Primary Shares and all or a portion of the selling commissions may be reallowed by the Dealer Manager to the Dealers who sold the Class T Primary Shares, Class S Primary Shares or Class D Primary Shares giving rise to such selling commissions, as described more fully in the Participating Dealer Agreement entered into with each such Dealer. The Dealer Manager shall not be responsible to the Company for failure by a Dealer to return any required selling commissions as set forth in Section “VI. Right to Reject Orders or Cancel Sales” in the Participating Dealer Agreement.
d. Subject to volume discounts and other special circumstances described in or otherwise provided in this Agreement and under the caption “Plan of Distribution” in the Prospectus, which may be amended and restated from time to time, the Company will pay to the Dealer Manager dealer manager fees in connection with sales of Class T Primary Shares, as described in Schedule 2 to this Agreement. The applicable dealer manager fees payable to the Dealer Manager will be paid substantially concurrently with the execution by the Company of orders submitted by purchasers of Class T Primary Shares and all or a portion of the dealer manager fees may be reallowed by the Dealer Manager to the Dealers who sold the Class T Primary Shares giving rise to such dealer manager fees, as described more fully in the Participating Dealer Agreement entered into with each such Dealer. The Dealer Manager shall not be responsible to the Company for failure by a Dealer to return any required dealer manager fees as set forth in Section “VI. Right to Reject Orders or Cancel Sales” in the Participating Dealer Agreement.
e. Except as may be provided in the “Plan of Distribution” section of the Prospectus, which may be amended, restated or supplemented from time to time, subject to the limitations set forth in Section 3.f. below, the Company will pay to the Dealer Manager a stockholder servicing fee with respect to sales of Class S and Class D shares and an investment professional stockholder servicing fee and a dealer stockholder servicing fee with respect to Class T shares, all as described in Schedule 2 to this Agreement (the “Servicing Fee”). The Company will pay the Servicing Fee to the Dealer Manager monthly in arrears. The Dealer Manager may reallow all or a portion of the Servicing Fee to (a) any Dealers who sold the Class T, Class S or Class D shares giving rise to a portion of such Servicing Fee to the extent the Participating Dealer Agreement with such Dealer provides for such a reallowance and such Dealer is in compliance with the terms of such Participating Dealer Agreement related to such reallowance, or (b) the broker-dealer of record/custodian for any Selected RIA or Selected Institution whose clients purchased Class D shares (each a “servicing dealer”) giving rise to a portion of such Servicing Fee to the extent the agreement between or among the Dealer Manager, the broker-dealer of record/custodian and/or the Selected RIA or Selected Institution, as applicable, provides for such a reallowance and such parties are in compliance with the terms of such agreement related to such reallowance; provided, however, that upon the date when the Dealer Manager is notified that the Dealer who sold the Class T, Class S or Class D shares giving rise to a portion of the Servicing Fee or a servicing dealer with respect to Class D shares is no longer the broker-dealer of record with respect to such Class T, Class S or Class D Shares or that the Dealer, Selected RIA, Selected Institution or servicing dealer no longer satisfies any or all of the conditions in its applicable agreement for the receipt of the Servicing Fee, then such Dealer or servicing dealer’s entitlement to the Servicing Fees related to such Class T, Class S and/or Class D shares, as applicable, shall cease, and such Dealer or servicing dealer shall not receive the Servicing Fee for any portion of the month in which it is not eligible on the last day of the month; provided, however, if there is a change in the broker-dealer of record with respect to the Class T, Class S or Class D shares, as applicable, made in connection with a change in the registration of record for the Class T, Class S or Class D shares on the Company’s books and records (including, but not limited to, a reregistration due to a sale or a transfer or a change in the form of ownership of the account), then the Dealer or servicing dealer shall be entitled to a pro rata portion of the Servicing Fees related to the Class T, Class S and/or Class D shares, as applicable, for the portion of the month for which the Dealer or servicing dealer was the broker-dealer or custodian of record. Thereafter, such Servicing Fees may be reallowed to the then-current broker-dealer of record of the Class T, Class S and/or Class D shares, as applicable, if any such broker-dealer of record has been designated (the “Servicing Dealer”), to the extent such Servicing Dealer has entered into a Participating Dealer Agreement or similar agreement with the Dealer Manager (“Servicing Agreement”), such Participating Dealer Agreement or Servicing Agreement with the Servicing Dealer provides for such reallowance and the Servicing Dealer is in compliance with the terms of such agreement related to such reallowance. In this regard, all determinations will be made by the Dealer Manager in good faith in its sole discretion. Offering Participants are not entitled to any Servicing Fee with respect to Class I shares. The Dealer Manager may also reallow some or all of the Servicing Fee to other broker-dealers who provide services with respect to the Shares (who shall be considered additional Servicing Dealers) pursuant to a Servicing Agreement with the Dealer Manager to the extent such Servicing Agreement provides for such reallowance and such additional Servicing Dealer is in compliance with the terms of such agreement related to such reallowance, in accordance with the terms of such Servicing Agreement. For the avoidance of doubt, (i) the Dealer Manager may waive the Servicing Fee to the extent Dealer or Servicing Dealer no longer provides services with respect to the Shares and (ii) the Company agrees that it will not deem the Dealer Manager to be the broker-dealer of record in situations described in this Section 3.e unless expressly agreed to in writing by the Dealer Manager.
f. The Dealer Manager shall cease receiving the Servicing Fee with respect to any Class T share, Class S share or Class D share purchased in the Primary Offering and held in a stockholder’s account at the end of the month in which the Dealer Manager, in conjunction with the transfer agent, determines that total selling commissions, dealer manager fees and Servicing Fees paid with respect to the shares held within such account would exceed, in the aggregate, 8.75% of the gross proceeds from the sale of such primary shares (including the gross proceeds of any shares issued under the DRIP with respect thereto), or, solely with respect to Class T shares, a lower limit as set forth in the Participating Dealer Agreement between the Dealer Manager and the applicable Dealer in effect on the date upon which such Class T shares were sold. At the end of such month, such Class T share, Class S share or Class D share (and any shares issued under the DRIP with respect thereto) held in a stockholder’s account will convert into a number of Class I shares (including any fractional shares) with an equivalent aggregate NAV as such share. In addition, the Dealer Manager will cease receiving the Servicing Fee on Class T shares, Class S shares and Class D shares in connection with an Offering (i.e., pursuant to the Registration Statement for such Offering) upon the earlier to occur of the following: (i) a listing of Class I shares, (ii) the merger or consolidation of the Company with or into another entity or the sale or other disposition of all or substantially all of the Company’s assets in each case in a transaction in which stockholders receive cash and/or securities listed on a national stock exchange or (iii) the date following the completion of such Offering on which, in the aggregate, underwriting compensation from all sources in connection with such Offering, including selling commissions, dealer manager fees, the Servicing Fee and other underwriting compensation, is equal to ten percent (10%) of the gross proceeds from Primary Shares sold in such Offering, as determined in good faith by the Dealer Manager in its sole discretion. For purposes of this Agreement, the portion of the Servicing Fee accruing with respect to publicly registered Class T shares, Class S shares and Class D shares of the Company’s common stock issued by the Company during the term of a particular Offering, and not issued pursuant to a prior Offering, shall be underwriting compensation with respect to such particular Offering and not with respect to any other Offering.
g. The terms of any reallowance of selling commissions, dealer manager fees and the Servicing Fee shall be set forth in the Participating Dealer Agreement, any agreement with a Selected RIA, Selected Institution Agreement or Servicing Agreement entered into with the Offering Participants or Servicing Dealers, as applicable. The Company will not be liable or responsible to any Offering Participant or Servicing Dealer for direct payment of commissions, or any reallowance of dealer manager fees or the Servicing Fee to such Offering Participant or Servicing Dealer, as applicable, it being the sole and exclusive responsibility of the Dealer Manager for payment of commissions or any reallowance of dealer manager fees or the Servicing Fee to Offering Participants and Servicing Dealers. Notwithstanding the foregoing, at the discretion of the Company, the Company may act as agent of the Dealer Manager by making direct payment of commissions, dealer manager fees or Servicing Fees to Offering Participants or Servicing Dealers on behalf of the Dealer Manager without incurring any liability.
h. In addition to the other items of underwriting compensation set forth in this Section 3, the Company and/or BentallGreenOak (U.S.) Limited Partnership (the “Adviser”) shall reimburse the Dealer Manager Parties for all items of underwriting compensation referenced in the Prospectus, to the extent the Prospectus indicates that they will be paid by the Company or the Adviser, as applicable, and to the extent permitted pursuant to prevailing rules and regulations of FINRA.
i. In addition to reimbursement as provided under Section 3.h., and subject to prevailing rules and regulations of FINRA, the Company shall also pay directly or reimburse the Dealer Manager Parties for reasonable bona fide due diligence expenses incurred by any Offering Participant as described in the Prospectus. The Dealer Manager shall obtain from any Offering Participant and provide to the Company a detailed and itemized invoice for any such due diligence expenses. Notwithstanding anything contained herein to the contrary, no payments or reimbursements made by the Company with respect to a particular Offering hereunder shall cause total organization and offering expenses, as defined under the Statement of Policy Regarding Real Estate Investment Trusts of the North American Securities Administrators Association, Inc. (as amended from time to time, the “NASAA Guidelines”), and FINRA rules, to exceed 15% of gross proceeds from such Offering.
j. The Dealer Manager Parties represents and warrants to the Company and each person and firm that signs the Registration Statement that the information under the caption “Plan of Distribution” in the Prospectus and all other information furnished to the Company by the Dealer Manager Parties in writing expressly for use in the Registration Statement, any preliminary prospectus, the Prospectus, or any amendment or supplement thereto does not contain 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 not misleading.
k. The Dealer Manager Parties and all Offering Participants, and all other broker-dealers effecting transactions in the Shares on behalf of Offering Participants, will offer and sell the Shares at the public offering prices per share as determined in accordance with the Prospectus.
