GREEN REALTY TRUST, INC. Up to $1,650,000,000 in Shares of Common Stock, $0.01 par value per share DEALER MANAGER AGREEMENT December 3, 2010
Exhibit 1.1
Up to $1,650,000,000 in Shares of Common Stock, $0.01 par value per share
DEALER MANAGER AGREEMENT
December 3, 2010
Newport
Coast Securities, Inc.
00000 XxxXxxxxx Xxxx., Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000
00000 XxxXxxxxx Xxxx., Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
Green Realty Trust, Inc., a Maryland corporation (the “Company”), has registered for
public sale (the “Offering”) a maximum of $1,650,000,000 in shares of its common stock,
$0.01 par value per share (the “Common Stock”), of which amount: (i) up to $150,000,000 in
shares of Common Stock are to be offered pursuant to the Company’s distribution reinvestment plan
for a purchase price of $9.50 per share (the “DRIP Shares”); and (ii) up to $1,500,000,000
in shares of Common Stock (the “Primary Shares” and, together with the DRIP Shares, the
“Offered Shares”) are to be issued and sold to the public on a “best efforts” basis through
you (the “Dealer Manager”) as the managing dealer and the broker-dealers participating in
the offering (the “Participating Dealers”) at an initial offering price of $10.00 per share
(subject in certain circumstances to discounts based upon the volume of shares purchased and for
certain categories of purchasers). The Company has reserved the right to reallocate the Offered
Shares between the Primary Shares and the DRIP Shares. Terms not otherwise defined herein shall
have the same meaning as in the Prospectus, as that term is defined below.
The Company is the sole general partner of Green REIT Operating Partnership, LP, a Delaware
limited partnership that serves as the Company’s operating partnership subsidiary (the
“Operating Partnership”). The Company and the Operating Partnership hereby jointly and
severally agree with you, the Dealer Manager, as follows:
1. Representations and Warranties of the Company and the Operating
Partnership
The Company and the Operating Partnership hereby represent and warrant to the Dealer Manager
and each Participating Dealer with whom the Dealer Manager has entered into or will enter into a
Participating Dealer Agreement (the “Participating Dealer Agreement”) in the form attached
as Exhibit A to this Agreement that, as of the date hereof and at all times during the
Offering Period, as that term is defined below (provided that, to the extent such representations
and warranties are given only as of a specified date or dates, the Company and the Operating
Partnership only make such representations and warranties as of such date or dates):
1.1
A registration statement on Form S-11 (No. 333-147514), including a preliminary
prospectus, for the registration of the Offered Shares has been prepared by the Company in
accordance with applicable requirements of the Securities Act, and the applicable
rules and regulations of the Commission promulgated thereunder (the “Securities Act
Regulations”), and was initially filed with the Commission
on or about November 19, 2007. The
Company has prepared and filed such amendments thereto, if any, and such amended preliminary
prospectuses, if any, as may have been required to the date hereof. As used in this Agreement, the
term “Registration Statement” means the Registration Statement, as amended through the date hereof,
except that, if the Company files any post-effective amendments to the Registration Statement,
“Registration Statement” shall refer to the Registration Statement as so amended by the last
post-effective amendment declared effective; the term “Effective Date” means the applicable date
upon which the Registration Statement or any post-effective amendment thereto is or was first
declared effective by the Commission; the term “Prospectus” means the prospectus in the form
constituting a part of the Registration Statement as well as in the form filed with the Commission
pursuant to Rule 424(b) after the Registration Statement becomes effective, except that the term
“Prospectus” shall also include any amendments or supplements thereto; and the term “Filing Date”
means the applicable date upon which the initial Prospectus or any amendment or supplement thereto
is filed with the Commission. As of the date hereof, the Commission has not issued any stop order
suspending the effectiveness of the Registration Statement and no proceedings for that purpose have
been instituted or are pending before or threatened by the Commission under the Securities Act.
1.2 The Registration Statement and the Prospectus, and any further amendments or supplements
thereto, will, as of the applicable Effective or Filing Date, as the case may be, comply in all
material respects with the Securities Act and the Securities Act Regulations; the Registration
Statement does not, and any amendments thereto will not, in each case as of the applicable
Effective Date, contain an untrue statement of material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements therein not misleading;
and the Prospectus does not, and any amendment or supplement thereto will not, as of the
applicable Filing Date, contain an 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 light
of the circumstances under which they were made, not misleading; provided, however, that the
Company and the Operating Partnership make no warranty or representation with respect to any
statement contained in the Registration Statement or the Prospectus, or any amendments or
supplements thereto, made in reliance upon and in conformity with information furnished in writing
to the Company by the Dealer Manager or any Participating Dealer expressly for use in the
Registration Statement or the Prospectus, or any amendments or supplements thereto.
1.3 The Company is a corporation duly organized and validly existing under the laws of the
State of Maryland, and is in good standing with the State Department of Assessments and Taxation
of Maryland, with full power and authority to conduct its business as described in the
Registration Statement and the Prospectus and to enter into this Agreement and to perform the
transactions contemplated hereby; this Agreement has been duly authorized, executed and delivered
by the Company and is a legal, valid and binding agreement of the Company enforceable against the
Company in accordance with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally, and
by general equitable principles, and except to the extent that the enforceability of the indemnity
and/or contribution provisions contained in Section 5 of this Agreement may be limited under
applicable securities laws.
1.4 Each of the Company and the Operating Partnership has qualified to do business and is in
good standing in every jurisdiction in which the ownership or leasing of its properties or the
nature or conduct of its business, as described in the Prospectus, requires such qualification,
except where the failure to do so would not have a material adverse effect on the condition,
financial or otherwise, results of operations or cash flows of the Company and the Operating
Partnership taken as a whole (a “Material Adverse Effect”).
1.5 The Operating Partnership is a limited partnership duly organized, validly existing and
in good standing under the laws of the State of Delaware, with full power and authority to conduct
its business as described in the Registration Statement and the Prospectus and to enter into this
Agreement and to perform the transactions contemplated hereby; as of the date hereof the Company
is the sole general partner of the Operating Partnership; this Agreement has been duly authorized,
executed and delivered by the Operating Partnership and is a legal, valid and binding agreement of
the Operating Partnership enforceable against the Operating Partnership in accordance with its
terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors’ rights generally, and by general equitable
principles, and except to the extent that the enforceability of the indemnity and/or contribution
provisions contained in Section 5 of this Agreement may be limited under applicable securities
laws.
1.6 The Offered Shares conform in all material respects to the description of the Common
Stock contained in the Registration Statement and the Prospectus. The authorized, issued and
outstanding shares of Common Stock as of the date hereof are as set forth in the Prospectus under
the caption “Description of Capital Stock.” As of the date hereof, all the issued and outstanding
shares of Common Stock of the Company are fully paid and non-assessable. All offers and sales of
the Common Stock prior to the date hereof were at all relevant times duly registered under the
Securities Act or were exempt from the registration requirements of the Securities Act and were
duly registered or the subject of an available exemption from the registration requirements of the
applicable state securities or blue sky laws. As of the date hereof, the Operating Partnership
has not issued any security or other equity interest other than units of partnership interest
(“Units”) as set forth in the Prospectus, and none of such outstanding Units has been
issued in violation of any preemptive right, and all of such Units have been issued by the
Operating Partnership in compliance with applicable federal and state securities laws.
1.7 The Company is not in violation of its charter or its bylaws and the execution and
delivery of this Agreement, the issuance, sale and delivery of the Offered Shares, the
consummation of the transactions herein contemplated and compliance with the terms of this
Agreement by the Company will not violate the terms of or constitute a default under: (a) its
charter or bylaws; or (b) any indenture, mortgage, deed of trust, lease, or other material
agreement to which the Company is a party or to which its properties are bound; or (c) any law,
rule or regulation applicable to the Company; or (d) any writ, injunction or decree of any
government, governmental instrumentality or court, domestic or foreign, having jurisdiction over
the Company except, in the cases of clauses (b), (c) and (d), for such violations or defaults
that, individually or in the aggregate, would not result in a Material Adverse Effect.
1.8 The Operating Partnership is not in violation of its certificate of limited partnership
or its partnership agreement and the execution and delivery of this Agreement, the consummation of
the transactions herein contemplated and compliance with the terms of this Agreement by the
Operating Partnership will not violate the terms of or constitute a default under: (a) its
certificate of limited partnership or partnership agreement; or (b) any indenture, mortgage, deed
of trust, lease, or other material agreement to which the Operating Partnership is a party or to
which its properties are bound; or (c) any law, rule or regulation applicable to the Operating
Partnership; or (d) any writ, injunction or decree of any government, governmental instrumentality
or court, domestic or foreign, having jurisdiction over the Operating Partnership except, in the
cases of clauses (b), (c) and (d), for such violations or defaults that, individually or in the
aggregate, would not result in a Material Adverse Effect.
1.9 The Company is organized in conformity with the requirements for qualification as a real
estate investment trust under the Internal Revenue Code of 1986, as amended (the “Code”),
and the Company’s intended method of operation, as set forth in the Prospectus, will enable it to
meet the requirements for taxation as a real estate investment trust under the Code. The
Operating Partnership will be treated as a partnership for federal income tax purposes and not as
a corporation or association taxable as a corporation.
1.10 Neither the Company nor the Operating Partnership is, and after giving effect to the
sale of the Offered Shares, will be an “investment company” or an entity “controlled” by an
“investment company,” as such terms are defined in the Investment Company Act of 1940, as amended,
and the rules and regulations promulgated thereunder (the “Investment Company Act”).
1.11 No consent, approval, authorization or other order of any governmental authority is
required in connection with the execution or delivery by the Company or the Operating Partnership
of this Agreement or the issuance and sale by the Company of the Offered Shares, except such as
may be required under the Securities Act or applicable state securities laws.
1.12 There are no actions, suits or proceedings pending or, to the knowledge of the Company
or the Operating Partnership, threatened against either the Company or the Operating Partnership
at law or in equity or before or by any federal or state commission, regulatory body or
administrative agency or other governmental body, domestic or foreign, which would have a Material
Adverse Effect.
1.13 The issuance and sale of the Offered Shares have been duly authorized by the Company,
and, when issued and duly delivered against payment therefore as contemplated by this Agreement,
will be validly issued, fully paid and non-assessable, free and clear of any pledge, lien,
encumbrance, security interest or other claim, and the issuance and sale of the Offered Shares by
the Company are not subject to preemptive or other similar rights arising by operation of law,
under the charter or bylaws of the Company or under any agreement to which the Company is a party
or otherwise.
1.14 The Company has entered into an escrow agreement (the “Escrow Agreement”) with
UMB Bank, N.A. as escrow agent (the “Escrow
Agent”) and the Dealer Manager, in the form included as an exhibit to the
Registration Statement, which provides for the establishment of an escrow account into which
subscribers’ funds will be deposited pursuant to the subscription procedures described in Section
13 below (the “Escrow Account”).
1.15 The financial statements of the Company included in the Registration Statement and the
Prospectus present fairly the financial position of the Company, as of the date specified, in
conformity with generally accepted accounting principles applied on a consistent basis and in
conformity with Regulation S-X of the Commission. No other financial statements or schedules are
required by Form S-11 or under the Securities Act Regulations to be included in the Registration
Statement, the Prospectus or any preliminary prospectus.
1.16
Deloitte & Touche LLP, or such other independent registered
public accounting firm that has audited and is
reporting upon any financial statements included or to be included in the Registration Statement
or the Prospectus or any amendments or supplements thereto, shall be as of the applicable
Effective or Filing Date, and shall have been during the periods covered by their report included
in the Registration Statement or the Prospectus or any amendments or supplements thereto,
independent public accountants with respect to the Company within the meaning of the Securities
Act and the Securities Act Regulations.
1.17 Since the respective dates as of which information is given in the Registration
Statement and the Prospectus or any amendments or supplements thereto, there has not been any
event or development which could reasonably be seen as having a Material Adverse Effect.
1.18 There are no contracts or other documents required by the Securities Act or the
Securities Act Regulations to be described in or incorporated by reference into the Registration
Statement or the Prospectus or to be filed as exhibits to the Registration Statement which have
not been accurately described in all material respects in the Prospectus or incorporated or filed
as required. The agreements to which either the Company or the Operating Partnership is a party
which are described in the Registration Statement and the Prospectus are valid and enforceable in
all material respects by the Company and/or the Operating Partnership except as enforceability may
be limited by bankruptcy, reorganization, moratorium or similar laws affecting the enforceability
of creditors’ rights generally and rules of law governing specific performance, injunctive relief
and other equitable remedies, and, to the best of the Company’s and the Operating Partnership’s
knowledge, no party thereto is in breach or default under any of such agreements except where such
breach or default would not have a Material Adverse Effect; each document incorporated by
reference into the Registration Statement or the Prospectus complied, as of the date filed, in all
material respects with the requirements as to form of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), and the rules and regulations promulgated thereunder (the
“Exchange Act Regulations”).
1.19 Each of the Company and the Operating Partnership has implemented controls and other
procedures that are designed to ensure that information required to be disclosed by the Company
in the reports that it files or submits under the Exchange Act and the Exchange Act Regulations is
recorded, processed, summarized and reported, within the time periods specified in the
Commission’s rules and forms and is accumulated and communicated
to the Company’s management, including its chief executive officer and chief financial
officer, or persons performing similar functions, as appropriate to allow timely decisions
regarding required disclosure; and the Company makes and keeps books, records and accounts which,
in reasonable detail, accurately and fairly reflect the transactions and dispositions of the
assets of the Company and the Operating Partnership; and the Company and the Operating Partnership
maintain a system of internal accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management’s general or specific authorization;
(ii) transactions are recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain accountability for
assets; (iii) access to assets is permitted only in accordance with management’s general or
specific authorization; and (iv) the recorded accountability for assets is compared with existing
assets at reasonable intervals and appropriate action is taken with respect to any differences;
and, to the Company’s knowledge, neither the Company nor the Operating Partnership, nor any
employee or agent thereof, has made any payment of funds of the Company or the Operating
Partnership, as the case may be, or received or retained any funds, and no funds of the Company,
or the Operating Partnership, as the case may be, have been set aside to be used for any payment,
in each case in material violation of any law, rule or regulation applicable to the Company or the
Operating Partnership.
1.20 No relationship, direct or indirect, exists between or among the Company on the one
hand, and the directors, officers, security holders of the Company, the Operating Partnership, or
their respective affiliates, on the other hand, which is required to be described in the
Prospectus and which is not so described.
2. Covenants of the Company and the Operating Partnership
The Company and the Operating Partnership hereby jointly and severally covenant and agree with
the Dealer Manager that:
2.1 The Company will: (a) use commercially reasonable efforts to cause the Registration
Statement and any subsequent amendments thereto to become effective as promptly as possible; (b)
promptly advise the Dealer Manager (i) of the receipt of any comments of, or requests for
additional or supplemental information from, the Commission, (ii) of the time and date of any
filing of any post-effective amendment to the Registration Statement or any amendment or
supplement to the Prospectus, and (iii) of the time and date that any post-effective amendment to
the Registration Statement becomes effective; (c) timely file every amendment or supplement to the
Registration Statement or the Prospectus that may be required by the Commission or under the
Securities Act; and (d) if at any time the Commission shall issue any stop order suspending the
effectiveness of the Registration Statement, it will promptly notify the Dealer Manager and, to
the extent the Company determines such action is in the best interest of the Company, use its
commercially reasonable efforts to obtain the lifting of such order at the earliest possible time.
2.2 In addition to and apart from the Prospectus, the Company intends to use printed sales
literature or other materials in connection with the Offering prepared by the Company or Insight
Green REIT Advisor, LLC, a Delaware limited liability company that serves as the Company’s advisor
pursuant to the terms of an advisory agreement (the
“Advisor”), which materials are generally described in the Prospectus. Such printed
sales literature or other materials prepared by the Company or the Advisor, provided that the use
of said sales literature and other materials has been approved for use by the Company in writing
and all appropriate regulatory agencies, are referred to hereinafter as the “Authorized Sales
Materials.” In the event that the Company uses printed materials in connection with the
Offering prepared by the Company or the Advisor intended for “broker-dealer use only,” Dealer
Manager shall use such “broker-dealer use only” materials in accordance with Section 4.3 below.
2.3 The Company will, at no expense to the Dealer Manager, furnish the Dealer Manager with
such number of printed copies of the Registration Statement, including all amendments and exhibits
thereto, as the Dealer Manager may reasonably request. The Company will similarly furnish to the
Dealer Manager and others designated by the Dealer Manager as many copies as the Dealer Manager
may reasonably request in connection with the Offering of the Offered Shares of: (a) the
Prospectus in preliminary and final form and every form of supplemental or amended prospectus; and
(b) the Authorized Sales Materials.
2.4 The Company will use its commercially reasonable efforts to qualify the Offered Shares
for offering and sale under, or to establish the exemption of the offering and sale of the Offered
Shares from qualification or registration under, the applicable state securities or “blue sky”
laws of each jurisdiction designated in Exhibit B hereto (the “Qualified
Jurisdictions”) and to maintain such qualifications or exemptions in effect throughout the
Offering. In connection therewith, the Company will prepare and file all such post-sales filings
or reports as may be required by the securities regulatory authorities in the Qualified
Jurisdictions in which the Offered Shares have been sold, provided that the Dealer Manager shall
have provided the Company with any information required for such filings or reports that is in the
Dealer Manager’s possession. The Company will notify the Dealer Manager promptly following each
date of: (a) the effectiveness of qualification or exemption of Offered Shares in any additional
jurisdiction in which the offering and sale of Offered Shares has been authorized by appropriate
state regulatory authorities; and (b) a change in the status of the qualification or exemption of
the Offered Shares in any jurisdiction in any respect. The Company will file and obtain clearance
of the Authorized Sales Material to the extent required by applicable state securities laws. The
Company will furnish to the Dealer Manager a copy of such papers filed by the Company in
connection with any such qualification.
2.5 If at any time when a Prospectus is required to be delivered under the Securities Act any
event occurs as a result of which, in the opinion of the Company, the Prospectus would include an
untrue statement of a material fact or omits to state any material fact necessary to make the
statements therein, in light of the circumstances under which they are made, not misleading, the
Company will promptly notify the Dealer Manager thereof (unless the information shall have been
received from the Dealer Manager) and the Dealer Manager and the Participating Dealers shall
suspend the offering and sale of the Offered Shares in accordance with Section 4.3 hereof until
such time as the Company, in its sole discretion (a) instructs the Dealer Manager to resume the
offering and sale of the Offered Shares and (b) has prepared any required supplemental or amended
prospectus as shall be necessary to correct such statement or omission and to comply with the
requirements of Section 10 of the Securities Act.
2.6 The Company will apply the proceeds from the sale of the Offered Shares as stated in the
Prospectus.
2.7 The Company will engage and maintain, at its expense, a registrar and transfer agent for
the Offered Shares.
3. Payment of Expenses and Fees.
[ ]
3.1 The Company agrees to pay all costs and expenses incident to the Offering, whether or not
the transactions contemplated hereunder are consummated or this Agreement is terminated, including
expenses, fees and taxes in connection with: (a) the registration fee, the preparation and filing
of the Registration Statement (including without limitation financial statements, exhibits,
schedules and consents), the Prospectus, and any amendments or supplements thereto, and the
printing and furnishing of copies of each thereof to the Dealer Manager and to Participating
Dealers (including costs of mailing and shipment); (b) the preparation, issuance and delivery of
certificates, if any, for the Offered Shares, including any stock or other transfer taxes or
duties payable upon the sale of the Offered Shares; (c) all fees and expenses of the Company’s
legal counsel, independent public or certified public accountants and other advisors; (d) the
qualification of the Offered Shares for offering and sale under state laws in the states,
including the Qualified Jurisdictions, that the Company shall designate as appropriate and the
determination of their eligibility for investment under state law as aforesaid and the printing
and furnishing of copies of any blue sky surveys or legal investment surveys to the Dealer
Manager; (e) filing for review by the Financial Industry Regulatory Authority (“FINRA”)
all necessary documents and information relating to the Offering and the Offered Shares;
(f) the fees and expenses of any transfer agent or registrar for the Offered Shares and
miscellaneous expenses referred to in the Registration Statement; (g) all costs and expenses
incident to the travel and accommodation of the Advisor’s personnel in making road show
presentations with respect to the offering of the Offered Shares; and (h) the performance of the
Company’s other obligations hereunder.
3.2 The Company shall reimburse
the Dealer Manager for reasonable bona fide due diligence expenses incurred by the Dealer Manager or any Participating Dealer. The Company shall only
reimburse the Dealer Manager or any Soliciting Dealer for bona fide due diligence expenses to the extent such expenses are supported by a detailed and
itemized invoice to the Company. Such due diligence expenses may include travel,
lodging, meals and other reasonable out-of-pocket expenses incurred by the Dealer Manager or any
Participating Dealer and their personnel when visiting the Company’s offices or properties to
verify information relating to the Company or its properties.
4. Obligations and Compensation of Dealer Manager
The Dealer Manager hereby represents and warrants to, and covenants and agrees with the
Company and the Operating Partnership (provided that, to the extent representations and warranties
are given only as of a specified date or dates, the Dealer Manager only makes such representations
and warranties as of such date or dates) as follows:
4.1
The Company hereby appoints the
Dealer Manager as its exclusive agent and distributor during the period commencing with the date
hereof and ending on the termination date of the Offering (the “Termination Date”)
described in the Prospectus (the “Offering Period”) to solicit and to cause Participating
Dealers to solicit subscriptions for the Offered Shares at the subscription price to be paid in
accordance with, and otherwise upon the other terms and conditions set forth in, the Prospectus
and the Subscription Agreement, and the Dealer Manager agrees to use its best efforts to procure
subscribers for the Offered Shares during the Offering Period. The Offered Shares offered and
sold through the Dealer Manager under this Agreement shall be offered and sold only by the Dealer
Manager and, at the Dealer Manager’s sole option, by any Participating Dealers whom the Dealer
Manager may retain, each of which shall be members of FINRA in good standing, pursuant to an
executed Participating Dealer Agreement with such Participating Dealer. The Dealer Manager hereby
accepts such agency and distributorship and agrees to use its best efforts to sell the Primary
Shares on said terms and conditions. The Dealer Manager represents to the Company that (i) it is
a member of FINRA in good standing, (ii) it and its employees and representatives have all
required licenses and registrations to act under this Agreement and (iii) it has established and
implemented anti-money laundering compliance programs in accordance with applicable law, including
applicable FINRA rules, Commission rules and regulations (“Commission Rules”) and the
Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act (USA PATRIOT Act) of 2001, as amended by the USA Patriot Improvement and
Reauthorization Act of 2005 (the “USA PATRIOT Act”), specifically including, but not
limited to, Section 352 of the International Money Laundering Abatement and Anti-Terrorist
Financing Act of 2001 (the “Money Laundering Abatement Act” and together with the USA
PATRIOT Act, the “AML Rules”) reasonably expected to detect and cause the reporting of
suspicious transactions in connection with the offering and sale of the Offered Shares. Dealer
Manager further represents that it is currently in compliance with all AML Rules, specifically
including, but not limited to, the Customer Identification Program requirements under Section 326
of the Money Laundering Abatement Act, and the Dealer Manager hereby covenants to remain in
compliance with such requirements and shall, upon request by the Company, provide a certification
to the Company that, as of the date of such certification (i) its AML Program is consistent with
the AML Rules, (ii) it has continued to implement its AML Program, and (iii) it is currently in
compliance with
all AML Rules, specifically including, but not limited to, the Customer Identification
Program requirements under Section 326 of the Money Laundering Abatement Act.
4.2 With respect to its participation and the participation by each Participating Dealer in
the offer and sale of the Offered Shares (including, without limitation any resales and transfers
of Offered Shares), the Dealer Manager agrees, and, by virtue of entering into the Participating
Dealer Agreement, each Participating Dealer shall have agreed, to comply and shall comply with any
applicable requirements of the Securities Act and the Exchange Act, and the applicable state
securities or blue sky laws, and the Rules of FINRA, specifically including, but not in any way
limited to, Rules 2340, 2420, 2730, 2740, and 2750 therein. The Dealer Manager agrees, and each
Participating Dealer shall have agreed, to comply and shall comply with any applicable
requirements with respect to its and each Participating Dealer’s participation in any resales or
transfers of the Offered Shares. In addition, the Dealer Manager agrees, and each Participating
Dealer shall have agreed, that should it or they assist with the resale or transfer of the Offered
Shares, it and each Participating Dealer will fully comply with all applicable FINRA or Commission
Rules or any other applicable Federal or state laws.
4.3 The Dealer Manager shall cause the Offered Shares to be offered and sold only in the
Qualified Jurisdictions, and in such additional jurisdictions as may be added thereto in which the
offering and sale of Offered Shares has been authorized by appropriate state regulatory
authorities. No Offered Shares shall be offered or sold for the account of the Company in any
other states. The Dealer Manager shall use and distribute in conjunction with the offer and sale
of any Offered Shares only the Prospectus and the Authorized Sales Materials. The Dealer Manager
represents and warrants to the Company that it will not use any sales literature not authorized
and approved by the Company or use any “broker-dealer use only” materials with members of the
public in connection with offers or sales or the Offered Shares. The Dealer Manager agrees, and
the Participating Dealers will each agree, to suspend or terminate offering and sale of the
Offered Shares upon request of the Company at any time and to resume offering and sale of the
Offered Shares upon subsequent request of the Company.
4.4 In consideration for the services rendered by the Dealer Manager, the Company agrees that
it will pay to the Dealer Manager:
(a) a dealer manager fee in the amount of 3.0% of the gross proceeds from the sale of the
Primary Shares (the “Dealer Manager Fee”), a portion of which may be reallowed to
Participating Dealers (as described more fully in the Participating Dealer Agreement entered into
with such Participating Dealer), which reallowance, if any, shall be determined by the Dealer
Manager in its discretion based on factors including, but not limited to, the number of shares sold
by such Participating Dealer, the assistance of such Participating Dealer in marketing the Offering
and due diligence expenses incurred, and the extent to which similar fees are reallowed to
participating broker-dealers in similar offerings being conducted during the Offering Period;
provided, however, that no Dealer Manager Fee shall be payable in respect of the purchase of
Shares by an officer, director or employee of the Company, the Advisor or their respective
affiliates; and
(b) subject to volume discounts and other special circumstances described in or otherwise
provided in the “Plan of Distribution” section of the Prospectus, selling
commissions in the amount of 7.0% of the gross proceeds of the Primary Shares sold, which
commissions may be reallowed in whole or in part to the Participating Dealer who sold the Offered
Shares giving rise to such commissions, as described more fully in the Participating Dealer
Agreement entered into with such Participating Dealer; provided, however, that no commissions
described in this clause (b) shall be payable in respect of the purchase of Shares: (i) through an
investment advisory representative affiliated with a Participating Dealer who is paid on a
fee-for-service basis by the investor; (ii) by a Participating Dealer (or such Participating
Dealer’s registered representative), in its individual capacity, or by a retirement plan of such
Participating Dealer (or such Participating Dealer’s registered representative), or (iii) by an
officer, director or employee of the Company, the Advisor or their respective affiliates.
Notwithstanding
the foregoing, as described in the Prospectus, the Dealer Manager
has agreed to sell Primary Shares to certain persons identified by
the Company pursuant to a “friends and family program” at
the public offering price, net of selling commissions or Dealer
Manager Fees. The Dealer Manager agrees to work together with the
Company to implement this program and to execute sales under the
program according to procedures agreed upon by the Dealer Manager and
the Company.
The Company will not pay to the Dealer Manager any Dealer Manager Fee or selling commissions in
respect of the purchase of any DRIP Shares.
4.5 Notwithstanding the foregoing, no commissions, payments or amounts whatsoever will be
paid to the Dealer Manager under Section 4.4 unless or until $2,000,000 has been raised from the
sale of Primary Shares in the Offering (the “Minimum Offering”). Until the Minimum
Offering is obtained, investments will be held in escrow. If the Minimum Offering is not obtained
within the time periods specified in the Prospectus, investments will be returned to the investors
in accordance with the Prospectus.
4.6 The Company will not be liable or responsible to any Participating Dealer for direct
payment of commissions or any reallowance of the Dealer Manager Fee to such Participating Dealer,
it being the sole and exclusive responsibility of the Dealer Manager for payment of commissions or
any reallowance of the Dealer Manager Fee to Participating Dealers. Notwithstanding the above,
the Company, in its sole discretion, either directly or through the Escrow Agent, may act as agent
of the Dealer Manager by making direct payment of commissions or reallowance of the Dealer Manager
Fee to such Participating Dealers without incurring any liability therefor. The Dealer Manager
Fee and all selling commissions payable to the Dealer Manager with respect to any Offered Shares
sold will be paid or offered substantially concurrently with the acceptance of subscribers for
such Offered Shares as stockholders by the Company.
4.7 The Dealer Manager represents and warrants to the Company, the Operating Partnership and
each person 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 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.
4.8 The Dealer Manager represents and warrants to the Company and the Operating Partnership
that it will not represent or imply that the Escrow Agent has investigated the desirability or
advisability of investment in the Company, or has approved, endorsed or passed upon the merits of
the Offered Shares or the Company, nor will the Dealer Manager use
the name of said escrow agent in any manner whatsoever in connection with the offer or sale
of the Offered Shares other than by acknowledgment that it has agreed to serve as escrow agent.
5. Indemnification
5.1 For the purposes of this Section 5, an entity’s “Indemnified Parties” shall
include such entity’s officers, directors, employees, members, partners, agents and
representatives, and each person, if any, who controls such entity within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act.
5.2 The Company and the Operating Partnership, jointly and severally, will indemnify, defend
(subject to Section 5.6) and hold harmless the Participating Dealers and the Dealer Manager, and
their respective Indemnified Parties, from and against any losses, claims (including the
reasonable cost of investigation), damages or liabilities, joint or several, to which such
Participating Dealers or the Dealer Manager, or their respective Indemnified Parties, may become
subject, under the Securities Act or the Exchange Act, or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon (a)
in whole or in part, any material inaccuracy in a representation or warranty contained herein by
either the Company or the Operating Partnership, any material breach of a covenant contained
herein by either the Company or the Operating Partnership, or any material failure by either the
Company or the Operating Partnership to perform its obligations hereunder or to comply with state
or federal securities laws applicable to the Offering, or (b) any untrue statement or alleged
untrue statement of a material fact contained (i) in any Registration Statement or any
post-effective amendment thereto or in the Prospectus or any amendment or supplement to the
Prospectus or (ii) in any Authorized Sales Materials or (iii) in any blue sky application or other
document executed by the Company or on its behalf specifically for the purpose of qualifying any
or all of the Offered Shares for sale under the securities laws of any jurisdiction or based upon
written information furnished by the Company or the Operating Partnership under the securities
laws thereof (any such application, document or information being hereinafter called a “Blue
Sky Application”), or (c) the omission or alleged omission to state a material fact required
to be stated in the Registration Statement or any post-effective amendment thereof or in the
Prospectus or any amendment or supplement to the Prospectus or necessary to make the statements
therein not misleading, and the Company and the Operating Partnership will reimburse each
Participating Dealer or the Dealer Manager, and their respective Indemnified Parties, for any
legal or other expenses reasonably incurred by such Participating Dealer or the Dealer Manager,
and their respective Indemnified Parties, in connection with investigating or defending such loss,
claim, damage, liability or action; provided, however, that the Company or the Operating
Partnership will not be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of, or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in reliance upon and in conformity with written information
furnished either (x) to the Company or the Operating Partnership by the Dealer Manager or (y) to
the Company, the Operating Partnership or the Dealer Manager by or on behalf of any Participating
Dealer expressly for use in the Registration Statement or any such post-effective amendment
thereof, or the Prospectus or any such amendment thereof or supplement thereto. This indemnity
agreement will be in addition to any liability which either the Company or the Operating
Partnership may otherwise have.
Notwithstanding the foregoing, as required by Section II.G. of the Statement of Policy
Regarding Real Estate Investment Trusts of the North American Securities Administrators
Association, Inc. (the “NASAA REIT Guidelines”), the indemnification and agreement to hold
harmless provided in this Section 5.2 is further limited to the extent that no such indemnification
by the Company or the Operating Partnership of a Participating Dealer or the Dealer Manager, or
their respective Indemnified Parties, shall be permitted under this Agreement for, or arising out
of, an alleged violation of federal or state securities laws, unless one or more of the following
conditions are met: (i) there has been a successful adjudication on the merits of each count
involving alleged securities law violations as to the particular indemnitee; (ii) such claims have
been dismissed with prejudice on the merits by a court of competent jurisdiction as to the
particular indemnitee; or (iii) a court of competent jurisdiction approves a settlement of the
claims against the particular indemnitee and finds that indemnification of the settlement and the
related costs should be made, and the court considering the request for indemnification has been
advised of the position of the Commission and of the published position of any state securities
regulatory authority in which the securities were offered or sold as to indemnification for
violations of securities laws.
5.3 The Dealer Manager will indemnify, defend and hold harmless the Company and the Operating
Partnership, their respective Indemnified Parties and each person who has signed the Registration
Statement, from and against any losses, claims, damages or liabilities to which any of the
aforesaid parties may become subject, under the Securities Act or the Exchange Act, or otherwise,
insofar as such losses, claims (including the reasonable cost of investigation), damages or
liabilities (or actions in respect thereof) arise out of or are based upon (a) in whole or in
part, any material inaccuracy in a representation or warranty contained herein by the Dealer
Manager, any material breach of a covenant contained herein by the Dealer Manager, or any material
failure by the Dealer Manager to perform its obligations hereunder or (b) any untrue statement or
any alleged untrue statement of a material fact contained (i) in any Registration Statement or any
post-effective amendment thereto or in the Prospectus or any amendment or supplement to the
Prospectus or (ii) in any Authorized Sales Materials or (iii) any Blue Sky Application, or (c) the
omission or alleged omission to state a material fact required to be stated in the Registration
Statement or any post-effective amendment thereof or in the Prospectus or any amendment or
supplement to the Prospectus or necessary to make the statements therein not misleading, provided,
however, that in each case described in clauses (b) and (c) to the extent, but only to the extent,
that such untrue statement or omission was made in reliance upon and in conformity with written
information furnished to the Company or the Operating Partnership by the Dealer Manager
specifically for use with reference to the Dealer Manager in the preparation of the Registration
Statement or any such post-effective amendments thereof or the Prospectus or any such amendment
thereof or supplement thereto, or (c) any use of sales literature by the Dealer Manager not
authorized or approved by the Company or any use of “broker-dealer use only” materials with
members of the public concerning the Offered Shares by the Dealer Manager, or (d) any untrue
statement made by the Dealer Manager or its representatives or agents or omission to state a fact
necessary in order to make the statements made, in light of the circumstances under which they
were made, not misleading in connection with the offer and sale of the Offered Shares, or (e) any
material violation by the Dealer Manager of this Agreement, or (f) any failure by the Dealer
Manager to comply with applicable laws governing money laundry abatement and anti-terrorist
financing efforts, including applicable FINRA Rules, Commission Rules and the USA PATRIOT Act, or
(g) any other failure by the Dealer Manager to comply with applicable FINRA or Commission
Rules. The Dealer Manager will reimburse the aforesaid parties in connection with investigation
or defense of such loss, claim, damage, liability or action. This indemnity agreement will be in
addition to any liability which the Dealer Manager may otherwise have.
5.4 Each Participating Dealer severally will indemnify, defend and hold harmless the Company,
the Operating Partnership, the Dealer Manager, each of their respective Indemnified Parties, and
each person who signs the Registration Statement, from and against any losses, claims, damages or
liabilities to which the Company, the Operating Partnership, the Dealer Manager, or any of their
respective Indemnified Parties, or any person who signed the Registration Statement, may become
subject, under the Securities Act or otherwise, insofar as such losses, claims (including the
reasonable cost of investigation), damages or liabilities (or actions in respect thereof) arise
out of or are based upon (a) in whole or in part, any material inaccuracy in a representation or
warranty by the Participating Dealer, any material breach of a covenant by the Participating
Dealer, or any material failure by the Participating Dealer to perform its obligations hereunder
or under the Participating Dealer Agreement, or (b) any untrue statement or alleged untrue
statement of a material fact contained (i) in any Registration Statement or any post-effective
amendment thereto or the Prospectus or any amendment or supplement to the Prospectus or (ii) in
any Authorized Sales Materials or (iii) any Blue Sky Application, or (c) the omission or alleged
omission to state a material fact required to be stated in the Registration Statement or any
post-effective amendment thereof or in the Prospectus or any amendment or supplement to the
Prospectus or necessary to make statements therein not misleading, provided, however, that in each
case described in clauses (b) and (c) to the extent, but only to the extent, that such untrue
statement or omission was made in reliance upon and in conformity with written information
furnished to the Company or the Operating Partnership or the Dealer Manager by the Participating
Dealer specifically for use with reference to the Participating Dealer in the Registration
Statement or any such post-effective amendments thereof or the Prospectus or any such amendment
thereof or supplement thereto, or (d) any use of sales literature by the Participating Dealer not
authorized or approved by the Company or use of “broker-dealer use only” materials with members of
the public concerning the Offered Shares by such Participating Dealer or Participating Dealer’s
representatives or agents, or (e) any untrue statement made by such Participating Dealer or its
representatives or agents or omission to state a fact necessary in order to make the statements
made, in light of the circumstances under which they were made, not misleading in connection with
the offer and sale of the Offered Shares, or (f) any failure by the Participating Dealer to comply
with Section VII or Section X or any other material violation of the Participating Dealer
Agreement, or (f) any failure of the Participating Dealer to comply with applicable laws governing
money laundry abatement and anti-terrorist financing efforts, including applicable FINRA Rules,
Commission Rules and the USA PATRIOT Act, or (g) any other failure by the Participating Dealer to
comply with applicable FINRA or Commission Rules or any other applicable Federal or state laws.
Each Participating Dealer will reimburse the aforesaid parties in connection with investigation or
defense of such loss, claim, damage, liability or action. This indemnity agreement will be in
addition to any liability which the Participating Dealer may otherwise have.
5.5 Promptly after receipt by any indemnified party under this Section 5 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 5, notify in writing
the indemnifying party of the commencement thereof and the omission to so notify the indemnifying
party will relieve such indemnifying party from any liability under this Section 5 as to the
particular item for which indemnification is then being sought, but not from any other liability
which it may have to any indemnified party. In case any such action is brought against any
indemnified party, and it notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled, to the extent it may wish, jointly with any other
indemnifying party similarly notified, to participate in the defense thereof, with separate
counsel. Such participation shall not relieve such indemnifying party of the obligation to
reimburse the indemnified party for reasonable legal and other expenses (subject to Section 5.6)
incurred by such indemnified party in defending itself, except for such expenses incurred after
the indemnifying party has deposited funds sufficient to effect the settlement, with prejudice, of
the claim in respect of which indemnity is sought. Any such indemnifying party shall not be
liable to any such indemnified party on account of any settlement of any claim or action effected
without the consent of such indemnifying party.
5.6 An indemnifying party under Section 5 of this Agreement shall be obligated to reimburse
an indemnified party for reasonable legal and other expenses as follows:
(a) In the case of the Company and/or the Operating Partnership indemnifying the Dealer
Manager, the advancement of Company funds to the Dealer Manager for legal expenses and other costs
incurred as a result of any legal action for which indemnification is being sought shall be
permissible (in accordance with Section II.G. of the NASAA REIT Guidelines) only if all of the
following conditions are satisfied: (i) the legal action relates to acts or omissions with respect
to the performance of duties or services on behalf of the Company; (ii) the legal action is
initiated by a third party who is not a shareholder of the Company or the legal action is initiated
by a shareholder of the Company acting in his or her capacity as such and a court of competent
jurisdiction specifically approves such advancement; and (iii) the Dealer Manager undertakes to
repay the advanced funds to the Company, together with the applicable legal rate of interest
thereon, in cases in which the Dealer Manager is found not to be entitled to indemnification.
(b) In any case of indemnification other than that described in Section 5.6(a) above, the
indemnifying party shall pay all legal fees and expenses of the indemnified party in the defense of
such claims or actions; provided, however, that the indemnifying party shall not be obligated to
pay legal expenses and fees to more than one law firm in connection with the defense of similar
claims arising out of the same alleged acts or omissions giving rise to such claims notwithstanding
that such actions or claims are alleged or brought by one or more parties against more than one
indemnified party. If such claims or actions are alleged or brought against more than one
indemnified party, then the indemnifying party shall only be obliged to reimburse the expenses and
fees of the one law firm that has been participating by a majority of the indemnified parties
against which such action is finally brought; and in the event a majority of such indemnified
parties is unable to agree on which law firm for which expenses or fees will be reimbursable by the
indemnifying party, then payment shall be made to the first law firm of record representing an
indemnified party against the action or claim. Such law firm shall be paid only to the extent of
services performed by such law firm and no reimbursement shall be payable to such law firm on
account of legal services performed by another law firm.
5.7 The indemnity agreements contained in this Section 5 shall remain operative and in full
force and effect regardless of: (a) any investigation made by or on behalf of any Participating
Dealer, or any person controlling any Participating Dealer or by or on behalf of the Company, the
Operating Partnership, the Dealer Manager or any officer or director thereof, or by or on behalf
of the Company or the Dealer Manager; (b) delivery of any Offered Shares and payment therefor; and
(c) any termination of this Agreement or any Participating Dealer Agreement. A successor of any
Participating Dealer or of any of the parties to this Agreement, as the case may be, shall be
entitled to the benefits of the indemnity agreements contained in this Section 5.
6. Survival of Provisions
The respective agreements, representations and warranties of the Company, the Operating
Partnership, and the Dealer Manager set forth in this Agreement shall remain operative and in full
force and effect until the Termination Date regardless of: (a) any investigation made by or on
behalf of the Dealer Manager or any Participating Dealer or any person controlling the Dealer
Manager or any Participating Dealer or by or on behalf of the Company, the Operating Partnership or
any person controlling the Company; and (b) the delivery of payment for the Offered Shares.
Following the termination of this Agreement, this Agreement will become void and there will be no
liability of any party to any other party hereto, except for obligations under Sections 5, 6, 7, 9,
10, 11 and 14, all of which will survive the termination of this Agreement.
7. Applicable Law; Venue
This Agreement was executed and delivered in, and its validity, interpretation and
construction shall be governed by the laws of, the State of Delaware; provided however, that causes
of action for violations of federal or state securities laws shall not be governed by this Section.
Venue for any action brought hereunder shall lie exclusively in Chicago, Illinois.
8. Counterparts
This Agreement may be executed in any number of counterparts. Each counterpart, when executed
and delivered, shall be an original contract, but all counterparts, when taken together, shall
constitute one and the same Agreement.
9. Entire Agreement
This Agreement and the Exhibits attached hereto constitute the entire agreement among the
parties and supersede any prior understanding, whether written or oral, prior to the date hereof
with respect to the Offering.
10. Successors and Amendment
10.1 This Agreement shall inure to the benefit of and be binding upon the Dealer Manager and
the Company and the Operating Partnership and their respective successors and permitted assigns
and shall inure to the benefit of the Participating Dealers to the extent set forth in Sections 1
and 5 hereof. Nothing in this Agreement is intended or shall be construed to give to any other person any right, remedy or claim, except as otherwise
specifically provided herein.
10.2 This Agreement may be amended only by the written agreement of the Dealer Manager, the
Company and the Operating Partnership.
10.3 Neither the Company or Operating Partnership, nor the Dealer Manager may assign or
transfer any of such party’s rights or obligations under this Agreement without the prior written
consent of the Dealer Manager, on the one hand, or the Company and the Operating Partnership,
acting together, on the other hand.
11. Term and Termination
11.1 This Agreement may be terminated by the Dealer Manager upon 60 calendar days’ written
notice to the Company and the Operating Partnership in accordance with Section 14 below. This
Agreement may be terminated by the Company and the Operating Partnership, acting together, upon
two business days’ written notice to the Dealer Manager in accordance with Section 14 below. In
any case, this Agreement shall expire at the close of business on the Termination Date.
11.2 The Dealer Manager, upon the expiration or termination of this Agreement, shall (i)
promptly deposit any and all funds, if any, in its possession which were received from investors
for the sale of Offered Shares into the appropriate escrow account or other account designated by
the Company for the deposit of investor funds, (ii) promptly deliver to the Company all records
and documents in its possession which relate to the Offering and are not designated as dealer
copies, (iii) provide a list of all purchasers and broker-dealers with whom the Dealer Manager has
initiated oral or written discussions regarding the Offering, and (iv) notify Participating
Dealers of such termination. The Dealer Manager, at its sole expense, may make and retain copies
of all such records and documents, but shall keep all such information confidential. The Dealer
Manager shall use its best efforts to cooperate with the Company to accomplish an orderly transfer
of management of the Offering to a party designated by the Company.
11.3 Upon expiration or termination of this Agreement, the Company shall pay to the Dealer
Manager all compensation to which the Dealer Manager is or becomes entitled under Section 5 at
such time as such compensation becomes payable.
12. Confirmation
The Company hereby agrees and assumes the duty to confirm on its behalf and on behalf of
dealers or brokers who sell the Offered Shares all orders for purchase of Offered Shares accepted
by the Company. Such confirmations will comply with the rules of the Commission and FINRA, and
will comply with applicable laws of such other jurisdictions to the extent the Company is advised
of such laws in writing by the Dealer Manager.
13. Submission of Orders
Each person desiring to purchase Primary Shares in the Offering will be required to complete
and execute a Subscription Agreement in the form attached as an Appendix to the Prospectus and to
deliver to the Dealer Manager or Participating Dealer, as the case may be (the “Processing
Broker-Dealer”), such completed Subscription Agreement, together with a check, draft, wire or
money order (hereinafter referred to as an “instrument of payment”) in the amount of $10.00
per Share, or such discounted purchase price per Share that may apply based upon the available
discounts specified in the Prospectus. There shall be a minimum initial purchase by any one
purchaser of 200 Primary Shares (except as otherwise indicated in the Prospectus, or in any letter
or memorandum from the Company to the Dealer Manager). Minimum subsequent purchases of Primary
Shares shall be $500 per transaction. The Processing Broker-Dealer receiving a Subscription
Agreement and instrument of payment not conforming to the foregoing instructions shall promptly return such
Subscription Agreement and instrument of payment directly to such subscriber following receipt by the Processing Broker-Dealer of such materials.
Subscription Agreements and instruments of payment received by the Processing Broker-Dealer which
conform to the foregoing instructions shall be transmitted for deposit pursuant to one of the
following methods:
(a) where, pursuant to the internal supervisory procedures of the Processing Broker-Dealer,
internal supervisory review is conducted at the same location at which Subscription Agreements and
instruments of payment are received from subscribers, then, by noon of the next business day
following receipt by the Processing Broker-Dealer, the Processing Broker-Dealer will transmit the
Subscription Agreements and instruments of payment to the Escrow Agent or, after the Minimum
Offering has been obtained, to the Company or to such other account or agent as directed by the
Company; and
(b) where, pursuant to the internal supervisory procedures of the Processing Broker-Dealer,
final internal supervisory review is conducted at a different location (the “Final Review
Office”), Subscription Agreements and instruments of payment will be transmitted by the
Processing Broker-Dealer to the Final Review Office by noon of the next business day following
receipt by the Processing Broker-Dealer. The Final Review Office will
in turn by noon of the
next business day following receipt by the Final Review Office, transmit such Subscription
Agreements and instruments of payment to the Escrow Agent or, after the Minimum Offering has been
obtained, to the Company or to such other account or agent as directed by the Company.
Notwithstanding the foregoing, with respect to any Offered Shares to be purchased by a
custodial account, the Processing Broker-Dealer shall cause the custodian of such account to
deliver a completed Subscription Agreement and instrument of payment for such account directly to
the Escrow Agent. The Processing Broker-Dealer shall furnish to the Escrow Agent with each
delivery of instruments of payment a list of the subscribers showing the name, address, social security number or tax
identification number, state of residence, amount of Offered Shares subscribed for, and the amount
of money paid.
14. Notices.
Any notice, approval, request, authorization, direction or other communication under this
Agreement shall be deemed given (a) when delivered personally, (b) on the first business day after
delivery to a national overnight courier service, (c) upon receipt of confirmation if sent via
facsimile, or (d) on the fifth business day after deposited in the United States mail, properly
addressed and stamped with the required postage, registered or certified mail, return receipt
requested, in each case to the intended recipient at the address set forth below:
If to the Company:
|
Green Realty Trust, Inc. | |
00 X. Xxxxxxx Xxxxxx #000 | ||
Xxxxxxx, Xxxxxxxx 00000 | ||
Facsimile: (000) 000-0000 | ||
Attention: Xxxxx X. Xxxxxx III | ||
If to the Operating Partnership:
|
Green Realty Trust, Inc., General Partner | |
00 X. Xxxxxxx Xxxxxx #000 | ||
Xxxxxxx, Xxxxxxxx 00000 | ||
Facsimile: (000) 000-0000 | ||
Attention: Xxxxx X. Xxxxxx III | ||
If to the Dealer Manager:
|
Newport Coast Securities, Inc. | |
00000 XxxXxxxxx Xxxx., Xxxxx Xxxxx | ||
Xxxxxx, Xxxxxxxxxx 00000 Facsimile: (000) 000-0000 |
Any party may change its address specified above by giving the other party notice of such
change in accordance with this Section 14.
[SIGNATURES ON FOLLOWING PAGE]
If the foregoing correctly sets forth our understanding, please indicate your acceptance
thereof in the space provided below for that purpose, whereupon this letter and your acceptance
shall constitute a binding agreement between us as of the date first above written.
Very truly yours, | ||||||||
“COMPANY” | ||||||||
GREEN REALTY TRUST, INC. | ||||||||
By: | /s/ Xxxxx X. Xxxxxx III | |||||||
Xxxxx X. Xxxxxx III President |
||||||||
“OPERATING PARTNERSHIP” | ||||||||
GREEN REIT OPERATING PARTNERSHIP, LP | ||||||||
By: | Green Realty Trust, Inc. | |||||||
its General Partner | ||||||||
By: | /s/ Xxxxx X. Xxxxxx III | |||||||
Xxxxx X. Xxxxxx III President |
Accepted and agreed as of the date first above written:
“DEALER MANAGER”
NEWPORT
COAST SECURITIES, INC.
By: |
/s/ Xxxxxxxx XxXxxxxxx | |||
Name: |
Xxxxxxxx XxXxxxxxx | |||
Title: |
President and CEO | |||
EXHIBIT
A
FORM OF PARTICIPATING DEALER AGREEMENT
GREEN REALTY TRUST, INC.
Up to $1,650,000,000 in Shares of Common Stock, $0.01 par value per share
FORM OF PARTICIPATING DEALER AGREEMENT
Up to $1,650,000,000 in Shares of Common Stock, $0.01 par value per share
FORM OF PARTICIPATING DEALER AGREEMENT
Dated: , 2010
Ladies and Gentlemen:
Subject
to the terms described hereinbelow,
Newport Coast Securities, Inc.,
as the dealer manager (“Dealer Manager”) for Green Realty Trust, Inc., a Maryland
corporation (the “Company”), invites you (“Participating Dealer”) to participate in
the distribution, on a best efforts basis, of up to $1,650,000,000 in shares of common stock of the
Company, $0.01 par value per share (the “Common Stock”), of which amount: (i) up to
$150,000,000 in shares of Common Stock are being offered pursuant to the Company’s distribution
reinvestment plan for a purchase price of $9.50 per share (the “DRIP Shares”); and (ii) up
to $1,500,000,000 in shares of Common Stock (the “Primary Shares” and together with the
DRIP Shares, the “Offered Shares”), are being offered at a purchase price of $10.00 per
share (subject in certain circumstances to discounts based upon the volume of shares purchased and
for certain categories of purchasers). Notwithstanding the foregoing, the Company has reserved the
right to reallocate the Offered Shares between the Primary Shares and the DRIP Shares.
I. Dealer Manager Agreement
The Company is the sole general partner of Green REIT Operating Partnership, LP, a Delaware
limited partnership that serves as the Company’s operating partnership subsidiary (the
“Operating Partnership”). The Dealer Manager has entered into a dealer manager agreement
with the Company and the Operating Partnership dated
[___], 2010, in the form attached hereto as
Exhibit A (the “Dealer Manager Agreement”). Upon effectiveness of this
Participating Dealer Agreement (this “Agreement”) pursuant to Section XIV below, you will
become one of the Participating Dealers referred to in the Dealer Manager Agreement and will be
entitled and subject to the provisions contained in the Dealer Manager Agreement, including the
provisions of the Dealer Manager Agreement wherein each of the Participating Dealers severally
agrees to indemnify and hold harmless the Company, the Operating Partnership, the Dealer Manager
and their respective officers, directors, employees, members, partners, agents and representatives,
and each person, if any, who controls such entity within the meaning of the Securities Act of 1933,
as amended (the “Securities Act”) or the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). Except as otherwise set forth herein, capitalized terms used and not
otherwise defined herein shall have the meanings given them in the Dealer Manager Agreement. The
Primary Shares are offered solely through broker-dealers who are members in good standing of the
Financial Industry Regulatory Authority (“FINRA”).
Participating Dealer hereby agrees to use its best efforts to sell the Primary Shares for cash
on the terms and conditions stated in the Prospectus. Nothing in this Agreement shall be
deemed or construed to make Participating Dealer an employee, agent, representative, partner
of the Dealer Manager, the Company or the Operating Partnership, and Participating Dealer is not
authorized to act for the Dealer Manager, the Company or the Operating Partnership or to make any
representations on their behalf except as set forth in the Prospectus and any printed sales
literature or other materials prepared by the Company or Green REIT Advisor, LLC, a Delaware
limited liability company that serves as the Company’s advisor pursuant to the terms of an advisory
agreement (the “Advisor”), provided that the use of said sales literature and other
materials has been approved for use by the Company in writing and all appropriate regulatory
agencies (the “Authorized Sales Materials”). In the event that the Company uses printed
materials in connection with the Offering prepared by the Company or the Advisor intended for
“broker-dealer use only,” Participating Dealer shall use such “broker-dealer use only” materials in
accordance with Section VII below.
II. Submission of Orders
Each person desiring to purchase Primary Shares in the Offering will be required to complete
and execute a Subscription Agreement in the form attached as an Appendix to the Prospectus and to
deliver to Participating Dealer such completed Subscription Agreement, together with a check,
draft, wire or money order (hereinafter referred to as an “instrument of payment”) in the amount of
$10.00 per Share, or such discounted purchase price per Share that may apply based upon the
available discounts specified in the Prospectus. There shall be a minimum initial purchase by any
one purchaser of 200 Primary Shares. Any Subscription Agreement and instrument of payment not
conforming to the foregoing instructions shall promptly be returned to such subscriber following receipt by Participating Dealer of such materials.
Subscription Agreements and instruments of payment received by the Participating Dealer which
conform to the foregoing instructions shall be transmitted for deposit pursuant to one of the
following methods:
(a) where, pursuant to Participating Dealer’s internal supervisory procedures, internal
supervisory review is conducted at the same location at which Subscription Agreements and
instruments of payment are received from subscribers, then, by noon of the next business
day following receipt by Participating Dealer, Participating Dealer will transmit the
Subscription Agreements and instrument of payment to the Escrow Agent (as defined below) or,
after the Minimum Offering (as defined below) has been obtained, to the Company or to such
other account or agent as directed by the Company; and
(b) where, pursuant to Participating Dealer’s internal supervisory procedures, final
internal supervisory review is conducted at a different location (the “Final Review
Office”); then Subscription Agreements and instruments of payment will be transmitted by
Participating Dealer to the Final Review Office by noon of the next business day
following receipt by Participating Dealer. The Final Review Office will in turn, by noon
of the next business day following receipt by the Final Review Office, transmit such
Subscription Agreements and instrument of payment to the Escrow Agent or, after the Minimum
Offering has been obtained, to the Company or to such other account or agent as directed by
the Company.
2
Participating Dealer understands that the Company reserves the unconditional right to reject any
order for any or no reason.
Notwithstanding the foregoing, with respect to any Primary Shares to be purchased by a
custodial account, the Participating Dealer shall cause the custodian of such account to deliver a
completed Subscription Agreement and instrument of payment for such account directly to the Escrow
Agent. The Participating Dealer shall furnish to the Escrow Agent with each delivery of
instruments of payment a list of the subscribers showing the name, address, social security number or tax identification
number, state of residence, amount of Primary Shares subscribed for, and the amount of money paid.
Participating Dealer hereby agrees to be bound by the terms of the Escrow Agreement, dated
[___], 2010 (the “Escrow
Agreement”), by and among UMB Bank, N.A., as escrow agent (the “Escrow Agent”), and the Company.
III. Pricing
Except for volume discounts described in or as otherwise provided in the “Plan of
Distribution” section of the Prospectus, Primary Shares shall be offered to the public at an
initial offering price of $10.00 per Share payable in cash. A minimum initial purchase of 200
Primary Shares is required, and minimum subsequent purchases of Primary Shares shall be $500 per
transaction. The Offered Shares are nonassessable. DRIP Shares shall be offered pursuant to the
Company’s distribution reinvestment plan for a purchase price of $9.50 per share.
IV. Participating Dealer’s Compensation
Subject to volume discounts and other special circumstances described in or as otherwise
provided in the “Plan of Distribution” section of the Prospectus, Participating Dealer’s selling
commission applicable to the total public offering price of Primary Shares sold by Participating
Dealer which it is authorized to sell hereunder is 7.0% of the gross proceeds of Primary Shares
sold by it and accepted and confirmed by the Company, which commission will be paid by the Dealer
Manager. No selling commissions will be paid in respect of the purchase of any DRIP Shares. For
these purposes, a “sale of Primary Shares” shall occur if and only if a transaction has closed with
a securities purchaser pursuant to all applicable offering and subscription documents and the
Company has thereafter distributed the commission to the Dealer Manager in connection with such
transaction. Participating Dealer hereby waives any and all rights to receive payment of
commissions due until such time as the Dealer Manager is in receipt of the commission from the
Company. Participating Dealer affirms that the Dealer Manager’s liability for commissions payable
to Participating Dealer is limited solely to the commissions received by the Dealer Manager from
the Company associated with Participating Dealer’s sale of Primary Shares. In addition, as set
forth in the Prospectus, the Dealer Manager in its sole discretion may reallow a portion of the
Dealer Manager Fee to Participating Dealer as marketing fees or to defray other
distribution-related expenses, which reallowance, if any, shall be determined by the Dealer Manager
in its sole discretion based on factors including, but not limited to, the number of Primary Shares
sold by Participating Dealer, the assistance of Participating Dealer in marketing the Offering and
due diligence expenses incurred, and the extent to which similar fees are
3
reallowed to participating broker-dealers in similar offerings being conducted during the
Offering. Such reallowance shall be described in Schedule 1 to this Agreement.
Participating Dealer acknowledges and agrees that: (i) no selling commissions or Dealer
Manager Fee will be paid in respect of the sale of any DRIP Shares; and (ii) no commissions,
payments or amount whatsoever will be paid to Participating Dealer in respect of the purchase of
Primary Shares by a Participating Dealer (or its registered representative), in its individual
capacity, or by a retirement plan of such Participating Dealer (or its registered representative),
or by an officer, director or employee of the Company, the Advisor or their respective affiliates.
Notwithstanding the foregoing, no commissions, payments or amounts whatsoever will be paid to
Participating Dealer under this Section IV unless or until $2,000,000 has been raised from the sale
of Primary Shares in the Offering (the “Minimum Offering”). Until the Minimum Offering is
obtained, investments will be held in escrow. If the Minimum Offering is not obtained within the
time periods specified in the Prospectus, investments will be returned to the investors in
accordance with the Prospectus.
The parties hereby agree that the foregoing commission is not in excess of the usual and
customary distributors’ or sellers’ commission received in the sale of securities similar to the
Primary Shares, that Participating Dealer’s interest in the offering is limited to such commission
from the Dealer Manager and Participating Dealer’s indemnity referred to in Section 6 of the Dealer
Manager Agreement, and that the Company is not liable or responsible for the direct payment of such
commission to Participating Dealer. In addition, as set forth in the Prospectus, the Dealer
Manager may reimburse the Participating Dealers reasonable bona fide due diligence expenses incurred by such Participating Dealers. The Company shall only reimburse Participating Dealers
for bona fide due diligence expenses to the extent such expenses are supported by a detailed and itemized invoice to the Company. Such due diligence
expenses may include travel, lodging, meals and other reasonable out-of-pocket expenses incurred by
the Dealer Manager or any Participating Dealer and their personnel when visiting the Company’s
offices or properties to verify information relating to the Company or its properties.
V. Payment
Payments of selling commissions will be made by the Dealer Manager (or by the Company as the
agent of the Dealer Manager, as provided in the Dealer Manager Agreement) to Participating Dealer
within 30 days of the receipt by the Dealer Manager of the gross commission payments from the
Company.
Participating Dealer, in its sole discretion, may authorize Dealer Manager (or the Company as
the agent of the Dealer Manager, as provided in the Dealer Manager Agreement) to deposit selling
commissions, reallowances and other payments due to it pursuant to this Agreement directly to its
bank account. If Participating Dealer so elects, Participating Dealer shall provide such deposit
authorization and instructions in Schedule 2 to this Agreement.
VI. Right to Reject Orders or Cancel Sales
All orders, whether initial or additional, are subject to acceptance by and shall only become
effective upon confirmation by the Company, which reserves the right to reject any
4
order for any or no reason. Orders not accompanied by a Subscription Agreement and executed
signature page thereto and the required instrument of payment for the Primary Shares may be
rejected. Issuance and delivery of the Primary Shares will be made only after actual receipt of
payment therefor. If any instrument of payment is not paid upon presentment, or if the Company is
not in actual receipt of clearinghouse funds or cash, certified or cashier’s check or the
equivalent in payment for the Primary Shares within 15 days of an order, the Company reserves the
right to cancel the order without notice. In the event an order is rejected, canceled or rescinded
for any reason, Participating Dealer agrees to return to the Dealer Manager any commission or
Dealer Manager Fee theretofore paid with respect to such order, and, if Participating Dealer fails
to so return any such commission or Dealer Manager, the Dealer Manager shall have the right to
offset amounts owed against future commissions or Dealer Manager Fees due and otherwise payable to
Participating Dealer.
VII. Prospectus and Authorized Sales Materials
Participating Dealer is not authorized or permitted to give, and will not give, any
information or make any representation (written or oral) concerning the Offered Shares except as
set forth in the Prospectus and the Authorized Sales Materials. The Dealer Manager will supply
Participating Dealer with reasonable quantities of the Prospectus, any supplements thereto and any
amended Prospectus, as well as any Authorized Sales Materials, for delivery to investors, and
Participating Dealer will deliver a copy of the Prospectus and all supplements thereto and any
amended Prospectus to each investor to whom an offer is made prior to or simultaneously with the
first solicitation of an offer to sell the Primary Shares to an investor. Participating Dealer
agrees that it will not send or give any supplements to the Prospectus, any amended Prospectus or
any Authorized Sales Materials to that investor unless it has previously sent or given a Prospectus
and all supplements thereto and any amended Prospectus to that investor or has simultaneously sent
or given a Prospectus and all supplements thereto and any amended Prospectus with such Prospectus
supplement, amended Prospectus or Authorized Sales Materials. Participating Dealer agrees that it
will not show or give to any investor or prospective investor or reproduce any material or writing
which is supplied to it by the Dealer Manager and marked “broker-dealer use only” or otherwise
bearing a legend denoting that it is not to be used in connection with the offer or sale of Offered
Shares to members of the public. Participating Dealer agrees that it will not use in connection
with the offer or sale of Offered Shares any materials or writings which have not been previously
approved by the Company other than the Prospectus and the Authorized Sales Materials.
Participating Dealer agrees to furnish a copy of any revised preliminary Prospectus to each person
to whom it has furnished a copy of any previous preliminary Prospectus, and further agrees that it
will itself mail or otherwise deliver all preliminary and final Prospectuses required for
compliance with the provisions of Rule 15c2-8 under the Exchange Act. Regardless of the
termination of this Agreement, Participating Dealer will deliver a Prospectus in transactions in
the Primary Shares for a period of 90 days from the Effective Date of the Registration Statement or
such longer period as may be required by the Exchange Act. Participating Dealer agrees to comply
with all the applicable requirements under the Securities Act and the Exchange Act in offering and
selling Primary Shares. Notwithstanding the termination of this Agreement or the payment of any
amount to Participating Dealer, Participating Dealer agrees to pay Participating Dealer’s
proportionate share of any claim, demand or liability asserted against Participating Dealer and the
other Participating Dealers on the basis that the Participating Dealers or any of them constitute
an
5
association, unincorporated business or other separate entity, including in each case
Participating Dealer’s proportionate share of any expenses incurred in defending against any such
claim, demand or liability.
VIII. License and Association Membership
Participating Dealer’s acceptance of this Agreement constitutes a representation to the
Company and the Dealer Manager that Participating Dealer is a properly registered or licensed
broker-dealer, duly authorized to sell Primary Shares under Federal and state securities laws and
regulations in all states where it offers or sells Primary Shares, and that it is a member in good
standing of FINRA. Participating Dealer represents and warrants that it is currently licensed as a
broker-dealer in the jurisdictions identified on Schedule 3 to this Agreement. This Agreement
shall automatically terminate if Participating Dealer ceases to be a member in good standing of
FINRA, or with the securities commission of the state in which the Participating Dealer’s principal
office is located, or in the case of a foreign dealer, so to conform. Participating Dealer agrees
to notify the Dealer Manager immediately if Participating Dealer ceases to be a member in good
standing of FINRA or with the securities commission of any state in which the Participating Dealer
is currently registered or licensed, or in the case of a foreign dealer, so to conform. The Dealer
Manager also hereby agrees to abide by the Rules of Fair Practice of FINRA and to comply with Rules
2340, 2420, 2730, 2740 and 2750 of the FINRA Conduct Rules.
IX. Anti-Money Laundering Compliance Programs
Participating Dealer’s acceptance of this Agreement constitutes a representation to the
Company and the Dealer Manager that Participating Dealer has established and implemented an
anti-money laundering compliance program (“AML Program”) in accordance with applicable law,
including applicable FINRA Rules, Securities and Exchange Commission Rules (the “Commission
Rules”) and the Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act (USA PATRIOT Act) of 2001, as amended by the USA Patriot
Improvement and Reauthorization Act of 2005 (the “USA PATRIOT Act”), specifically
including, but not limited to, Section 352 of the International Money Laundering Abatement and
Anti-Terrorist Financing Act of 2001 (the “Money Laundering Abatement Act” and together
with the USA PATRIOT Act, the “AML Rules”), reasonably expected to detect and cause the
reporting of suspicious transactions in connection with the sale of Primary Shares. Participating
Dealer covenants that it will perform all activities it is required to perform by applicable AML
Rules and its AML Program with respect to all customers on whose behalf Participating Dealer
submits orders to the Company. To the extent permitted by applicable law, Participating Dealer
will share information with the Dealer Manager and the Company for purposes of ascertaining whether
a suspicious activity report (“SAR”) is warranted with respect to any suspicious transaction
involving the purchase or intended purchase of Primary Shares.
Upon request by the Dealer Manager at any time, Participating Dealer hereby agrees to (i)
furnish a written copy of its AML Program to the Dealer Manager for review, and (ii) furnish a copy
of the findings and any remedial actions taken in connection with Participating Dealer’s most
recent independent testing of its AML Program. Participating Dealer further represents that
6
it is currently in compliance with all AML Rules, specifically including, but not limited to,
the Customer Identification Program requirements under Section 326 of the Money Laundering
Abatement Act, and such Participating Dealer hereby covenants to remain in compliance with such
requirements and shall, upon request by the Dealer Manager, provide a certification to Dealer
Manager that, as of the date of such certification (i) its AML Program is consistent with the AML
Rules, (ii) it has continued to implement its AML Program, and (iii) it is currently in compliance
with all AML Rules, specifically including, but not limited to, the Customer Identification Program
requirements under Section 326 of the Money Laundering Abatement Act.
X. Limitation of Offer; Suitability
Participating Dealer will offer Primary Shares only to persons who meet the suitability
standards set forth in the Prospectus or in any suitability letter or memorandum sent to it by the
Company or the Dealer Manager and will only make offers to persons in the jurisdictions in which it
is advised in writing that the Primary Shares are qualified for sale or that such qualification is
not required. Notwithstanding the qualification of the Primary Shares for sale in any respective
jurisdiction (or the exemption therefrom), Participating Dealer represents, warrants and covenants
that it will not offer Primary Shares and will not permit any of its registered representatives to
offer Primary Shares in any jurisdiction unless both the Participating Dealer and such registered
representative are duly licensed to transact securities business in such jurisdiction. In offering
Primary Shares, Participating Dealer will comply with the provisions of the Rules of Fair Practice
set forth in the FINRA Manual, as well as all other applicable rules and regulations relating to
suitability of investors, including without limitation, the provisions of Section III.C. of the
Statement of Policy Regarding Real Estate Investment Trusts of the North American Securities
Administrators Association, Inc. (the “NASAA REIT Guidelines”).
Participating Dealer further represents, warrants and covenants that neither Participating
Dealer, nor any person associated with Participating Dealer, shall offer or sell Primary Shares in
any jurisdiction except to investors who satisfy the investor suitability standards and minimum
investment requirements under the most restrictive of the following: (1) applicable provisions of
the Prospectus; (2) applicable laws of the jurisdiction of which such investor is a resident; (3)
applicable FINRA Conduct Rules; or (4) the provisions of Section III.C. of the NASAA REIT
Guidelines. Participating Dealer agrees to ensure that, in recommending the purchase, sale or
exchange of Primary Shares to an investor, Participating Dealer, or a person associated with
Participating Dealer, shall have reasonable grounds to believe, on the basis of information
obtained from the investor (and thereafter maintained in the manner and for the period required by
the Commission, any state securities commission, FINRA or the Company) concerning his age,
investment objectives, other investments, financial situation and needs, and any other information
known to Participating Dealer, or person associated with Participating Dealer, that (A) the
investor is or will be in a financial position appropriate to enable him to realize to a
significant extent the benefits described in the Prospectus, including the tax benefits to the
extent they are a significant aspect of the Company, (B) the investor has a fair market net worth
sufficient to sustain the risks inherent in an investment in Primary Shares in the amount proposed,
including loss and lack of liquidity of such investment, and (C) an investment in Primary Shares is
otherwise suitable for such investor. Participating Dealer further represents, warrants and
covenants that Participating Dealer, or a person associated with Participating
7
Dealer, will make every reasonable effort to determine the suitability and appropriateness of
an investment in Primary Shares of each proposed investor by reviewing documents and records
disclosing the basis upon which the determination as to suitability was reached as to each
purchaser of Primary Shares pursuant to a subscription solicited by Participating Dealer, whether
such documents and records relate to accounts which have been closed, accounts which are currently
maintained, or accounts hereafter established. Participating Dealer agrees to retain such
documents and records in Participating Dealer’s records for a period of six years from the date of
the applicable sale of Primary Shares, to otherwise comply with the record keeping requirements
provided in Section XII below and to make such documents and records available to (i) the Dealer
Manager and the Company upon request, and (ii) representatives of the Commission, FINRA and
applicable state securities administrators upon Participating Dealer’s receipt of an appropriate
document subpoena or other appropriate request for documents from any such agency. Participating
Dealer shall not purchase any Primary Shares for a discretionary account without obtaining the
prior written approval of Participating Dealer’s customer and his or her signature on a
Subscription Agreement.
XI. Due Diligence; Adequate Disclosure
Prior to offering the Primary Shares for sale, Participating Dealer shall have conducted an
inquiry such that Participating Dealer has reasonable grounds to believe, based on information made
available to Participating Dealer by the Company or the Dealer Manager through the Prospectus or
other materials, that all material facts are adequately and accurately disclosed and provide a
basis for evaluating a purchase of Primary Shares. In determining the adequacy of disclosed facts
pursuant to the foregoing, Participating Dealer may obtain, upon request, information on material
facts relating at a minimum to the following: (1) items of compensation; (2) physical properties;
(3) tax aspects; (4) financial stability and experience of the Company and its advisor; (5)
conflicts and risk factors; and (6) appraisals and other pertinent reports. Notwithstanding the
foregoing, Participating Dealer may rely upon the results of an inquiry conducted by an independent
third party retained for that purpose or another Participating Dealer, provided that: (1) such
Participating Dealer has reasonable grounds to believe that such inquiry was conducted with due
care by said independent third party or such other Participating Dealer; (2) the results of the
inquiry were provided to Participating Dealer with the consent of the other Participating Dealer
conducting or directing the inquiry; and (3) no Participating Dealer that participated in the
inquiry is an affiliate of the Company. Prior to the sale of the Primary Shares, Participating
Dealer shall inform each prospective purchaser of Primary Shares of pertinent facts relating to the
Primary Shares including specifically the lack of liquidity and lack of marketability of the
Primary Shares during the term of the investment but shall not, in any event, make any
representation on behalf of the Company or the Operating Partnership except as set forth in the
Prospectus and any Authorized Sales Materials.
XII. Compliance with Record Keeping Requirements
Participating Dealer agrees to comply with the record keeping requirements of the Exchange
Act, including but not limited to, Rules 17a-3 and 17a-4 promulgated under the Exchange Act.
Participating Dealer further agrees to keep such records with respect to each customer who
purchases Primary Shares, his suitability and the amount of Primary Shares sold,
8
and to retain such records for such period of time as may be required by the Commission, any
state securities commission, FINRA or the Company.
XIII. Customer Complaints
Participating Dealer hereby agrees to provide to the Dealer Manager copies of any written or
otherwise documented customer complaints received by Participating Dealer relating in any way to
the Offering (including, but not limited to, the manner in which the Primary Shares are offered by
Participating Dealer), the Primary Shares or the Company.
XIV. Effective Date
This Agreement will become effective upon the last date it is signed by either party hereto.
XV. Termination; Amendment
Participating Dealer will immediately suspend or terminate its offer and sale of Primary
Shares upon the request of the Company or the Dealer Manager at any time and will resume its offer
and sale of Primary Shares hereunder upon subsequent request of the Company or the Dealer Manager.
Any party may terminate this Agreement by written notice pursuant to Section XVIII below. This
Agreement and the exhibits and schedules hereto are the entire agreement of the parties and
supersedes all prior agreements, if any, between the parties hereto.
This Agreement may be amended at any time by the Dealer Manager by written notice to
Participating Dealer, and any such amendment shall be deemed accepted by Participating Dealer upon
placing an order for sale of Primary Shares after it has received such notice.
XVI. Assignment
Participating Dealer shall have no right to assign this Agreement or any of Participating
Dealer’s rights hereunder or to delegate any of Participating Dealer’s obligations. Any purported
assignment or delegation by Participating Dealer shall be null and void. The Dealer Manager shall
have the right to assign any or all of its rights and obligations under this Agreement by written
notice to Participating Dealer pursuant to Section XVIII below.
XVII. Privacy Laws
The Dealer Manager and Participating Dealer (each referred to individually in this section as
a “party”) agree as follows:
(a) Each party agrees to abide by and comply with (i) the privacy standards and
requirements of the Xxxxx-Xxxxx-Xxxxxx Act of 1999 (“GLB Act”); (ii) the privacy
standards and requirements of any other applicable Federal or state law; and (iii) its own
internal privacy policies and procedures, each as may be amended from time to time;
(b) Each party agrees to refrain from the use or disclosure of nonpublic personal
information (as defined under the GLB Act) of all customers who have
opted out of such disclosures except as necessary to service the customers or as otherwise
necessary or required by applicable law; and
9
(c) Each party shall be responsible for determining which customers have opted out of
the disclosure of nonpublic personal information by periodically reviewing and, if
necessary, retrieving a list of such customers (the “List”) as provided by each to
identify customers that have exercised their opt-out rights. In the event either party uses
or discloses nonpublic personal information of any customer for purposes other than
servicing the customer, or as otherwise required by applicable law, that party will consult
the List to determine whether the affected customer has exercised his or her opt-out rights.
Each party understands that each is prohibited from using or disclosing any nonpublic
personal information of any customer that is identified on the List as having opted out of
such disclosures.
XVIII. Notice
All notices will be in writing and deemed given (a) when delivered personally, (b) on the
first business day after delivery to a national overnight courier service, (c) upon receipt of
confirmation if sent via facsimile, or (d) on the fifth business day after deposit in the United
States mail, properly addressed and stamped with the required postage, registered or certified
mail, return receipt requested, to the Dealer Manager at
00000 XxxXxxxxx Xxxx., Xxxxx Xxxxx, Xxxxxx, Xxxxxxxxxx 00000, Facsimile:
(000) 000-0000, and to
Participating Dealer at the address specified by Participating Dealer below.
XIX. Attorneys’ Fees, Applicable Law and Venue
In any action to enforce the provisions of this Agreement or to secure damages for its breach,
the prevailing party shall recover its costs and reasonable attorney’s fees. This Agreement shall
be construed under the laws of the State of Delaware and shall take effect pursuant to Section XIV
above. Venue for any action (including arbitration) brought hereunder shall lie exclusively in
Chicago, Illinois.
[SIGNATURES ON FOLLOWING PAGES]
10
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on its behalf
by its duly authorized agent.
“DEALER MANAGER” NEWPORT COAST SECURITIES, INC. |
||||
By: | ||||
Name: | ||||
Title: | ||||
We have read the foregoing Agreement and we hereby accept and agree to the terms and
conditions therein set forth. We hereby represent that the jurisdictions identified below
represent a true and correct list of all jurisdictions in which we are registered or licensed as a
broker or dealer and are fully authorized to sell securities, and we agree to advise you of any
change in such list during the term of this Agreement.
1. Identity of Participating Dealer:
Full Legal Name:
Type of Entity:
Organized in the State of:
Tax Identification Number:
FINRA/CRD Number:
2. Any notice under this Agreement will be deemed given pursuant to Section XVIII hereof when
delivered to Participating Dealer as follows:
Company Name:
|
||||||
Attention to: |
||||||
(Name) |
||||||
(Title) |
||||||
Street Address: |
||||||
City, State and Zip Code: | ||||||
Telephone No.: | ( ) | |||||
Facsimile No.: | ( ) | |||||
Email Address: |
||||||
Accepted and agreed as of the date below:
“PARTICIPATING DEALER”
By: |
||||||
Name: | ||||||
Title: | ||||||
Date: | ||||||
A-12
SCHEDULE 1
TO
PARTICIPATING DEALER AGREEMENT WITH
NEWPORT COAST SECURITIES, INC. (“DEALER MANAGER”)
TO
PARTICIPATING DEALER AGREEMENT WITH
NEWPORT COAST SECURITIES, INC. (“DEALER MANAGER”)
NAME OF ISSUER: GREEN REALTY TRUST, INC.
NAME OF PARTICIPATING DEALER: |
||
SCHEDULE TO AGREEMENT DATED: |
||
As marketing fees and to defray other distribution-related expenses, the Dealer Manager will pay
basis points of the gross cash proceeds on all sales generated by Participating Dealer
pursuant to Section IV of this Participating Dealer Agreement. These amounts are in addition to
the selling commissions provided for in Section IV of this Participating Dealer Agreement and
will be due and payable at the same time as the selling commissions, as more fully described in
Section V hereof.
“DEALER MANAGER” NEWPORT COAST SECURITIES, INC. |
||||||
By: | ||||||
Name: | ||||||
Title: | ||||||
“PARTICIPATING DEALER”
By:
|
||||||
Name: | ||||||
Title: | ||||||
A-13
SCHEDULE 2
TO
PARTICIPATING DEALER AGREEMENT WITH
NEWPORT COAST SECURITIES, INC. (“DEALER MANAGER”)
TO
PARTICIPATING DEALER AGREEMENT WITH
NEWPORT COAST SECURITIES, INC. (“DEALER MANAGER”)
NAME OF ISSUER: GREEN REALTY TRUST, INC.
NAME OF PARTICIPATING DEALER: |
||
SCHEDULE TO AGREEMENT DATED: |
||
Participating Dealer hereby authorizes the Dealer Manager or its agent to deposit selling
commissions, reallowances and other payments due to it pursuant to the Participating Dealer
Agreement to its bank account specified below. This authority will remain in force until
Participating Dealer notifies the Dealer Manager in writing to cancel it. In the event that the
Dealer Manager deposits funds erroneously into Participating Dealer’s account, the Dealer Manager
is authorized to debit the account with no prior notice to Participating Dealer for an amount not
to exceed the amount of the erroneous deposit.
Bank Name: |
||||||
Bank Address: | ||||||
Bank Routing Number: | ||||||
Account Number: | ||||||
“PARTICIPATING DEALER”
By: |
||||||
Name: | ||||||
Title: | ||||||
Date: | ||||||
A-14
SCHEDULE 3
TO
PARTICIPATING DEALER AGREEMENT WITH
NEWPORT COAST SECURITIES, INC.
TO
PARTICIPATING DEALER AGREEMENT WITH
NEWPORT COAST SECURITIES, INC.
Participating Dealer represents and warrants that it is currently licensed as a broker-dealer
in the following jurisdictions:
o
|
Alabama | o | Nebraska | |||
o |
Alaska | o | Nevada | |||
o |
Arizona | o | New Hampshire | |||
o |
Arkansas | o | New Jersey | |||
o |
California | o | New Mexico | |||
o |
Colorado | o | New York | |||
o |
Connecticut | o | North Carolina | |||
o |
Delaware | o | North Dakota | |||
o |
District of Columbia | o | Ohio | |||
o |
Florida | o | Oklahoma | |||
o |
Georgia | o | Oregon | |||
o |
Hawaii | o | Pennsylvania | |||
o |
Idaho | o | Puerto Rico | |||
o |
Illinois | o | Rhode Island | |||
o |
Indiana | o | South Carolina | |||
o |
Iowa | o | South Dakota | |||
o |
Kansas | o | Tennessee | |||
o |
Kentucky | o | Texas | |||
o |
Louisiana | o | Utah | |||
o |
Maine | o | Vermont | |||
o |
Maryland | o | Virgin Islands | |||
o |
Massachusetts | o | Virginia | |||
o |
Michigan | o | Washington | |||
o |
Minnesota | o | West Virginia | |||
o |
Mississippi | o | Wisconsin | |||
o |
Missouri | o | Wyoming | |||
o |
Montana |
A-15
EXHIBIT B
QUALIFIED JURISDICTIONS
AS OF [ ], 2010
AS OF [ ], 2010
o |
Alabama | o | Nebraska | |||
o |
Alaska | o | Nevada | |||
o |
Arizona | o | New Hampshire | |||
o |
Arkansas | o | New Jersey | |||
o |
California | o | New Mexico | |||
o |
Colorado | o | New York | |||
o |
Connecticut | o | North Carolina | |||
o |
Delaware | o | North Dakota | |||
o |
District of Columbia | o | Ohio | |||
o |
Florida | o | Oklahoma | |||
o |
Georgia | o | Oregon | |||
o |
Hawaii | o | Pennsylvania | |||
o |
Idaho | o | Puerto Rico | |||
o |
Illinois | o | Rhode Island | |||
o |
Indiana | o | South Carolina | |||
o |
Iowa | o | South Dakota | |||
o |
Kansas | o | Tennessee | |||
o |
Kentucky | o | Texas | |||
o |
Louisiana | o | Utah | |||
o |
Maine | o | Vermont | |||
o |
Maryland | o | Virgin Islands | |||
o |
Massachusetts | o | Virginia | |||
o |
Michigan | o | Washington | |||
o |
Minnesota | o | West Virginia | |||
o |
Mississippi | o | Wisconsin | |||
o |
Missouri | o | Wyoming | |||
o |
Montana |