DEALER MANAGER AGREEMENT March 25, 2009
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SHORT TERM INCOME PROPERTIES XX, INC.
Up to
25,000,000 Shares of Beneficial Interest
March 25,
2009
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▇▇▇▇▇- Principal
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Investments, Inc.
▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇. ▇▇▇
▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear ▇▇.
▇▇▇▇▇:
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Short Term Income Properties XX, Inc. a Maryland
corporation (the "Company"), is registering for public sale a minimum of 200,000
shares and a maximum of 25,000,000 shares of common stock (the "Shares), (the
"Offering"), to be issued and sold for $10.00 per Share at an aggregate purchase
price of $2,000,000.00 to $250,000,000.00. There shall be a minimum purchase by
any one person of 1,000 Shares (except as otherwise indicated in the Prospectus
or in any letter or memorandum from the Company to ▇▇▇▇▇ Investments, Inc. the
"Dealer Manager"). Terms not defined herein shall have the same meaning as in
the Prospectus. In connection therewith, the Company hereby agrees with you, the
Dealer Manager, as follows:
1. Representations and
Warranties of the Company
The
Company represents and warrants to the Dealer Manager and each dealer with whom
the Dealer Manager has entered into or will enter into a Soliciting Dealer
Agreement in the font' attached to this Agreement as Exhibit A (said
dealers being hereinafter called the "Dealers") that:
1.1 A
Prospectus with respect to the Company has been prepared by the Company in
accordance with applicable requirements of the Securities Act of 1933, as
amended (the "Securities Act"), and the applicable rules and regulations (the
"Rules and Regulations") of the Securities and Exchange Commission (the "SEC")
promulgated thereunder, covering the Shares. Copies of such Prospectus and each
amendment thereto have been or will be delivered to the Dealer Manager. (The
Prospectus and any amendments thereto hereinafter referred to as the
"Prospectus"),
1.2 The
Company has been duly and validly organized and formed as a corporation under
the laws of the state of Maryland, with the power and authority to conduct its
business as described in the Prospectus.
1.3 The
Prospectus complies with the Securities Act and the Rules and Regulations and
does not contain any untrue statements of material facts or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading; provided, however, that the foregoing
provisions of this Section 1.3 will not extend to such statements contained in
or omitted from the Prospectus as are primarily within the knowledge of the
Dealer Manager or any of the Dealers and are based upon information furnished by
the Dealer Manager in writing to the Company specifically for inclusion
therein.
1.4 The
Company intends to use the funds received from the sale of the Shares as set
forth in the Prospectus.
1.5 No
consent, approval, authorization or other order of any governmental authority is
required in connection with the execution or delivery by the Company of this
Agreement or the issuance and sale by the Company of the Shares, except such as
may be required under the Securities Act or applicable state securities
laws.
1.6 There
are no actions, suits or proceedings pending or to the knowledge of the Company,
threatened against the Company 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 will have a material adverse
effect on the business or property of the Company.
1.7 The
execution and delivery of this Agreement, the consummation of the transactions
herein contemplated and compliance with the terms of this Agreement by the
Company will not conflict with or constitute a default under any charter, bylaw,
indenture, mortgage, deed of trust, lease, rule, regulation, writ, injunction or
decree of any government, governmental instrumentality or court, domestic or
foreign, having jurisdiction over the Company, except to the extent that the
enforceability of the indemnity and/or contribution provisions contained in
Section 4 of this Agreement may be limited under applicable securities
laws.
1.8 The
Company has full legal right, power and authority to enter into this Agreement
and to perform the transactions contemplated hereby, except to the extent that
the enforceability of the indemnity and/or contribution provisions contained in
Section 4 of this Agreement may be limited under applicable securities
laws.
1.9 At
the time of the issuance of the Shares, the Shares will have been duly
authorized and validly issued, and upon payment therefore, will be fully paid
and nonassessable and will conform to the description thereof contained in the
Prospectus.
2.
Covenants of the
Company
The
Company covenants and agrees with the Dealer Manager that:
2.1 It
will, at no expense to the Dealer Manager, furnish the Dealer Manager with such
number of printed copies of the Prospectus, including all amendments and
exhibits thereto, as the Dealer Manager may reasonably request. It 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 Shares of: (a) the Prospectus in preliminary
and final form and every form of supplemental or amended Prospectus; (b) this
Agreement; and (c) any other printed sales literature or other materials
(provided that the use of said sales literature and other materials has been
first approved for use by the Company and all appropriate regulatory
agencies).
2.2 It
will furnish such proper information and execute and file such documents as may
be necessary for the Company to qualify the Shares for offer and sale under the
securities laws of such jurisdictions as the Dealer Manager may reasonably
designate and will file and make in each year such statements and reports as may
be required. The Company will furnish to the Dealer Manager a copy of such
papers filed by the Company in connection with any such
qualification.
2.3 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 either the Company or the Dealer Manager,
the Prospectus or any other Prospectus then in effect would include an untrue
statement of a material fact or, in view of the circumstances under which they
were made, omit to state any material fact necessary to make the statements
therein not misleading, the Company will promptly notify the Dealer Manager
thereof (unless the information shall have been received from the Dealer
Manager) and will effect the preparation of an amended or supplemental
Prospectus which will correct such statement or omission. The Company will then
promptly prepare such amended or supplemental Prospectus or Prospectuses as may
be necessary to comply with the requirements of Section 10 of the Securities
Act.
3.
Obligations and
Compensation of Dealer Manager
3.1 The
Company hereby appoints the Dealer Manager as its agent and principal
distributor for the purpose of selling for cash up to a maximum of 25,000,000
Shares through Dealers, all of whom shall be members of the Financial Industry
Regulatory Authority (FINRA), members of any other regulated exchange or
registered investment advisors. The Dealer Manager may also sell Shares for cash
directly to its own clients and customers at the public offering price and
subject to the terms and conditions stated in the Prospectus. The Dealer Manager
hereby accepts such agency and distributorship and agrees to use its best
efforts to sell the Shares on said terms and conditions. The Dealer Manager
represents to the Company that (i) it is a member of FINRA; (ii) it will at all
times maintain and employ an adequate number administrative personnel (who shall
be acceptable to the Company) to fulfill its obligations under this agreement
and any supplemental or successor agreement and shall be solely responsible for
the compensation of such personnel; (iii) it will be responsible for payment of
such other costs incurred by it in connection with the Offering as shall be
agreed between the Company and the Dealer Manager, which costs shall not exceed
the amounts received by the Dealer Manager as a dealer manager fee (discussed
below); (iv) it and its employees and representatives have all required licenses
and registrations to act under this Agreement; and (v) it has established and
implemented anti-money laundering compliance programs in accordance with
applicable law, including applicable FINRA rules, SEC rules and the USA PATRIOT
Act of 2001, reasonably expected to detect and cause the reporting of suspicious
transactions in connection with the sale of Shares of the Company. The Dealer
Manager agrees to be bound by the terms of the Escrow Agreement, a copy of which
is attached as Exhibit "B" (the "Escrow Agreement").
3.2 Promptly
after the effective date of this agreement, the Dealer Manager and the Dealers
shall commence the offering of the Shares for cash to the public in
jurisdictions in which the Shares are registered or qualified for sale or in
which such offering is otherwise permitted. The Dealer Manager and the Dealers
will suspend or terminate offering of the Shares upon request of the Company at
any time and will resume offering the Shares upon subsequent request of the
Company.
3.3 Except
as provided in the "Plan of Distribution" Section of the Prospectus, as
compensation for the services rendered by the Dealer Manager, the Company agrees
that it will pay to the Dealer Manager a fee of up to 2.5% of gross offering
proceeds before reallowance to participating broker-dealers, but not less than
$5,000.00 per month after said reallowances. Pursuant to separately negotiated
agreements, Dealer Manager may re-allow a portion of its Dealer Manager fee in
an aggregate amount not to exceed the maximum permitted under the FINRA and
NASAA REIT Guidelines to broker-dealers participating in the offering.
Notwithstanding the foregoing, no commissions, payments or amount whatsoever
will be paid to the Dealer Manager under this Section 3.3 unless or until the
gross proceeds of the Shares sold are disbursed to the Company pursuant to the
Escrow Agreement. Until the Required Capital, the Pennsylvania Required Capital
or the New York Required Capital (as applicable and as defined in the Escrow
Agreement) is obtained, investments will be held in escrow and, if the Required
Capital, the Pennsylvania Required Capital or the New York Required Capital, as
applicable, is not obtained, investments will be returned to the investors in
accordance with the Prospectus. The Company will not be liable or responsible to
any Dealer for direct authorization of payment of commissions to such Dealer, it
being the sole and exclusive responsibility of the Dealer Manager for
authorizing payment of commissions to Dealers. No sales commission or dealer
manager fee will be paid with respect to Shares sold pursuant to the Company's
dividend reinvestment plan. Total underwriting compensation, including sales
commissions, the dealer manager fee and underwriter expense reimbursement may
not exceed the maximum amount allowed under the rules of FINRA.
3.4 The
Dealer Manager represents and warrants to the Company and each person and firm
that signs the
Registration Statement that the information under the caption "Plan of
Distribution" in the Prospectus and all other information furnished to the
Company by the Dealer Manager 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.
3.5 The
Dealer Manager shall use and distribute in conjunction with the offer and sale
of any Shares only the Prospectus and such sales literature and advertising as
shall have been previously approved in writing by the Company.
3.6 The
Dealer Manager shall cause Shares to be offered and sold only in those
jurisdictions specified in writing by the Company for whose account Shares are
then offered for sale, and such list of jurisdictions shall be updated by the
Company as additional states are added. The Company shall specify only such
jurisdictions in which the offering and sale of its Shares has been authorized
by appropriate state regulatory authorities. No Shares shall be offered or sold
for the account of the Company in any other states.
3.7 The
Dealer Manager represents and warrants to the Company that it will not represent
or imply that the escrow agent, as identified in the Prospectus, has
investigated the desirability or advisability of investment in the Company, or
has approved, endorsed or passed upon the merits of the Shares or the Company,
nor will it use the name of said escrow agent in any manner whatsoever in
connection with the offer or sale of the Shares other than by acknowledgment
that it has agreed to serve as escrow agent.
4. Indemnification
4.1 The
Company will indemnify and hold harmless the Dealers and the Dealer Manager,
their officers and directors and each person, if any, who controls such Dealer
or Dealer Manager within the meaning of Section 15 of the Securities Act from
and against any losses, claims, damages or liabilities, joint or several, to
which such Dealers or Dealer Manager, their officers and directors, or such
controlling person may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon (a) any untrue statement or alleged
untrue statement of a material fact contained (i) in any Registration Statement
(including the Prospectus as a part thereof) or any post-effective amendment
thereto or in the Prospectus or any amendment or supplement to the Prospectus or
(ii) 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 Shares
for sale under the securities laws of any jurisdiction or based upon written
information furnished by the Company under the securities laws thereof (any such
application, document or information being hereinafter called a "Blue Sky
Application"), or (b) the omission or alleged omission to state in the
Prospectus or any post-effective amendment thereof or in any Blue Sky
Application a material fact required to be stated therein or necessary to make
the statements therein not misleading, or (c) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary Prospectus, if
used prior to the effective date of the agreement, or in the Prospectus or any
amendment or supplement to the Prospectus or the omission or alleged omission to
state therein a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading, and will reimburse each Dealer or Dealer
Manager, its officers and each such controlling person for any legal or other
expenses reasonably incurred by such Dealer or Dealer Manager, its officers and
directors, or such controlling person in connection with investigating or
defending such loss, claim, damage, liability or action; provided that the
Company 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 to the Company or
Dealer Manager by or on behalf of any Dealer or Dealer Manager specifically for
use with reference to such Dealer or Dealer Manager in the preparation of the
Registration Statement or any such post-effective amendment thereof, any such
Blue Sky Application or any such preliminary Prospectus or the Prospectus or any
such amendment thereof or supplement thereto; and further provided that the
Company will not be liable in any such case if it is determined that such Dealer
or Dealer Manager was at fault in connection with the loss, claim, damage,
liability or action. Notwithstanding the foregoing, the Company may not
indemnify or hold harmless the Dealer Manager, any Dealer or any of their
affiliates in any manner that would be inconsistent with the provisions of
Section II.G. of the Statement of Policy Regarding Real Estate Investment Trusts
of the North American Securities Administrators Association, Inc. effective May
7, 2007, as amended (the "NASAA REIT Guidelines"). In particular, but without
limitation, the Company may not indemnify or hold harmless the Dealer Manager,
any Dealer or any of their affiliates for liabilities arising from or out of a
violation of state or federal securities laws, unless one or more of the
following conditions are met:
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(a)
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there
has been a successful adjudication on the merits of each count involving
alleged securities law violations;
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(b)
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such
claims have been dismissed with prejudice on the merits by a court of
competent jurisdiction; or
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(c)
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a
court of competent jurisdiction approves a settlement of the claims
against the 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 SEC
and of the published position of any state securities regulatory authority
in which the securities were offered as to indemnification for violations
of securities laws.
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4.2 The
Dealer Manager will indemnify and hold harmless the Company and each person, if
any, who controls the Company within the meaning of Section 15 of the Securities
Act, from and against any losses, claims, damages or liabilities to which any of
the aforesaid parties may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon (a) any untrue statement of a material
fact contained (i) in the Prospectus , or any post-effective amendment thereof
or (ii) any Blue Sky Application, or (b) the omission to state in the Prospectus
or any post-effective amendment thereof or in any Blue Sky Application a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (c) any untrue statement or alleged untrue statement
of a material fact contained in any preliminary Prospectus, if used prior to the
effective date of this agreement or in the Prospectus, or in any amendment or
supplement to the Prospectus or the omission to state therein a material fact
required to be stated therein or necessary in order to make the statements
therein in the light of the circumstances under which they were made not
misleading in each case 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 by or on behalf of the Dealer Manager
specifically for use with reference to the Dealer Manager in the preparation of
any such Blue Sky Application or any such preliminary Prospectus or the
Prospectus or any such amendment thereof or supplement thereto, or (d) any
unauthorized use of sales materials or use of unauthorized verbal
representations concerning the Shares by the Dealer Manager, or (e) any failure
to comply with applicable laws governing money laundry abatement and
anti-terrorist financing efforts, including applicable FINRA rules, SEC rules
and the USA PATRIOT Act of 2001, and will reimburse the aforesaid parties, in
connection with investigation or defending such loss, claim, damage, liability
or action. This indemnity agreement will be in addition to any liability which
the Dealer Manager may otherwise have.
4.3 Each
Dealer severally will indemnify and hold harmless the Company, Dealer Manager
and each of their directors (including any persons named in the Prospectus with
his consent, as about to become a director), and each person, if any, who
controls the Company and the Dealer Manager within the meaning of Section 15 of
the Securities Act from and against any losses, claims, damages or liabilities
to which the Company, the Dealer Manager, any such director or officer, or
controlling person may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon (a) any untrue statement or alleged
untrue statement of a material fact contained (i) in the Prospectus or any
post-effective amendment thereof or (ii) in any Blue Sky Application, or (b) the
omission or alleged, omission to state in the Prospectus as a part thereof or
any post-effective amendment thereof or in any Blue Sky Application a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or (c) any untrue statement or alleged untrue statement of a
material fact contained in any preliminary Prospectus, if used prior to the
effective date of this agreement, or in the Prospectus, or in any amendment or
supplement to the Prospectus or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company or the Dealer Manager by or on behalf of such Dealer
specifically for use with reference to such Dealer in the preparation of any
such Blue Sky Application or any such preliminary Prospectus or the Prospectus
or any such amendment thereof or supplement thereto, or (d) any unauthorized use
of sales materials or use of unauthorized verbal representations concerning the
Shares by such Dealer or Dealer's representations or agents in violation of
Section 4 of the Soliciting Dealer Agreement or otherwise, or (e) any failure to
comply with applicable laws governing money laundry abatement and anti-terrorist
financing efforts, including applicable FINRA rules, SEC rules and the USA
PATRIOT Act of 2001, and will reimburse the Company and the Dealer Manager and
any such directors or officers, or controlling person, in connection with
investigating or defending any such loss, claim, damage, liability or action.
This indemnity agreement will be in addition to any liability which such Dealer
may otherwise have.
4.4 Promptly
after receipt by an indemnified party under this Section 4 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 4,
notify in writing the indemnifying party of the commencement thereof and the
omission so to notify the indemnifying party will relieve such indemnifying
party from any liability under this Section 4 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
4.5) 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.
4.5 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 flint 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 selected 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.
4.6 The
indemnity agreements contained in this Section 4 shall remain operative and in
full force and effect regardless of (a) any investigation made by or on behalf
of any Dealer, or any person controlling any Dealer or by or on behalf of the
Company, 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 Shares and
payment therefore, and (c) any termination of this Agreement. A successor of any
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
4.
5. Survival of
Provisions
The
respective agreements, representations and warranties of the Company and the
Dealer Manager set forth in this Agreement shall remain operative and in full
force and effect regardless of (a) any termination of this Agreement, (b) any
investigation made by or on behalf of the Dealer Manager or any Dealer or any
person controlling the Dealer Manager or any Dealer or by or on behalf of the
Company or any person controlling the Company, and (c) the acceptance of any
payment for the Shares.
6. 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 Texas; 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 Houston, Texas.
7. 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.
8. Successors and
Amendment
This
Agreement shall inure to the benefit of and be binding upon the Dealer Manager
and the Company and their respective successors. 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. This Agreement shall
inure to the benefit of the Dealers to the extent set forth in Sections 1 and 4
hereof. This Agreement may be amended by the written agreement of the Dealer
Manager and the Company.
9. Term
This
Agreement may be terminated by either party (i) immediately upon notice to the
other party in the event that the other party shall have materially failed to
comply with any of the material provisions of this Agreement on its part to be
performed during the term of this Agreement or if any of the representations,
warranties, covenants or agreements of such party contained herein shall not
have been materially complied with or satisfied within the times specified or
(ii) by either party on 60 days' written notice.
In any
case, this Agreement shall expire at the close of business on the effective date
that the Offering is terminated. The provisions of Section 4 hereof shall
survive such termination. In addition, the Dealer Manager, upon the expiration
or termination of this Agreement, shall (i) promptly deposit any and all funds
in its possession which were received from investors for the sale of Shares into
the appropriate escrow account or, if the minimum number of Shares have been
sold and accepted by the Company, into such other account as the Company may
designate; and (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. 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. Upon expiration or termination of this
Agreement, the Company shall pay to the Dealer Manager all fees to which the
Dealer Manager is or becomes entitled under Section 3 at such time as such fees
become payable.
10. Confirmation
The
Company hereby agrees and assumes the duty to confirm on its behalf and on
behalf of dealers or brokers who sell the Shares all orders for purchase of
Shares accepted by the Company. Such confirmations will comply with the rules of
the SEC 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.
11. Suitability of
Investors
The
Dealer Manager will offer Shares, and in its agreements with Dealers will
require that the Dealers offer Shares, only to persons who meet the financial
qualifications set forth in the Prospectus or in any suitability letter or
memorandum sent to it by the Company and will only make offers to persons in the
states in which it is advised in writing that the Shares are qualified for sale
or that such qualification is not required. In offering Shares, the Dealer
Manager will, and in its agreements with Dealers, the Dealer Manager will
require that the Dealers will, comply with the provisions of all applicable
rules and regulations relating to suitability of investors.
12. Submission of
Orders
12.1 Those
persons who purchase Shares will be instructed by the Dealer Manager or the
Dealer to make their checks payable pursuant to the escrow instructions
contained in the Escrow Agreement. The Dealer Manager and any Dealer receiving a
check not conforming to the foregoing instructions shall return such check
directly to such subscriber not later than the end of the next business day
following its receipt. Checks received by the Dealer Manager or Dealer which
conform to the foregoing instructions shall be transmitted for deposit pursuant
to one of the methods described in this Section 12. Transmittal of received
investor funds will be made in accordance with the following procedures. The
Dealer Manager may authorize certain Dealers which are "$250,000 broker-dealers"
to instruct their customers to make their checks for Shares subscribed for
payable directly to the Dealer. In such case, the Dealer will collect the
proceeds of the subscribers' checks and issue a check for the aggregate amount
of the subscription proceeds made payable to the order of the escrow
agent.
12.2 If
a Dealer conducts its internal supervisory procedures at the location where
subscription documents and checks are initially received, the Dealer shall
forward (i) the subscription documents to the Dealer Manager and (ii) the checks
to the escrow agent by noon of the next business day following receipt of the
subscription documents and the check.
12.3 If
a Dealer's internal supervisory procedures are to be performed at a different
location (the "Final Review Office"), the subscription documents and check must
be transmitted to the Final Review Office by the end of the next business day
following receipt of the subscription documents and check by the Dealer. The
Final Review Office will, by the next business day following receipt of the
subscription documents and check, forward both the subscription documents and
check to the Dealer Manager as processing broker-dealer in order that the Dealer
Manager may complete its review of the documentation and process the
subscription documents and check.
12.4 Any
check received by the Dealer Manager directly or as processing broker-dealer
from the Dealers will, in all cases, be forwarded to the escrow agent as soon as
practicable, but in any event by the end of the second business day following
receipt by the Dealer Manager of the subscription documents and check. Checks of
rejected subscribers will be promptly returned to such subscribers.
12.5 If
requested by the Company, the Dealer Manager shall obtain, and shall cause the
Dealers to obtain, from subscribers for the Shares, other documentation
reasonably deemed by the Company to be required under applicable law or as may
be necessary to reflect the policies of the Company. Such documentation may
include, without limitation, subscribers' written acknowledgement and agreement
to the privacy policies of the Company.
13. Selected Investment Advisor
Agreement
With
respect to any provision of information concerning the Offering by a selected
investment advisor (the "Investment Advisor") presently registered under the
Investment Advisers Act of 1940, as amended, and presently and appropriately
registered in each state in which the Investment Advisor has clients, the
Company and the Investment Advisor shall enter into a Selected Investment
Advisor Agreement in substantially the form attached hereto as Exhibit
B.
14. Notices.
Any
notice, approval, request, authorization, direction or other communication under
this Agreement shall be given in writing and shall be deemed to be delivered
when delivered in person or deposited in the United States mail, properly
addressed and stamped with the required postage, registered or certified mail,
return receipt requested, to the intended recipient as set forth
below:
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If
to the Company:
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▇▇▇▇▇▇▇
Short Term Income Properties XX, Inc. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
Attention:
President
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If
to the Dealer Manager:
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▇▇▇
▇▇▇▇▇
▇▇▇▇▇
Investments, Inc.
▇▇▇▇
▇. ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇. ▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇
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Any party
may change its address specified above by giving the other party notice of such
change in accordance with this Section 14.
This
agreement may be executed in counterparts, including electronically transmitted
counterparts, each of which shall be deemed an original and together shall be a
single agreement. 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.
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Very
truly yours,
▇▇▇▇▇▇▇ SHORT TERM INCOME PROPERTIES XX,
INC.
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By:
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/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |
| ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President | |||
Accepted
and agreed as of the
date
first above written.
▇▇▇▇▇
INVESTMENTS, INC.
By: /s/ ▇▇▇▇▇
▇▇▇▇▇
Name: ▇▇▇▇▇
▇▇▇▇▇
Title:
Vice
President