PACIFIC OFFICE PROPERTIES TRUST, INC. UP TO 40,000,000 SHARES OF SENIOR COMMON STOCK DEALER MANAGER AGREEMENT
UP
TO 40,000,000 SHARES OF SENIOR COMMON STOCK
____________,
2010
Priority
Capital Investments, LLC
10188
Telesis Court
Suite
130
San
Diego, California 92121
Ladies
and Gentlemen:
Pacific
Office Properties Trust, Inc., a Maryland corporation (the “Company”), is
registering $400,000,000 aggregate principal amount of shares of its Senior
Common Stock, $0.0001 par value per share (the “Shares”), for sale to
the public (the “Offering”), of which
(i) $350,000,000 aggregate principal amount of Shares is intended to be
offered pursuant to the primary offering and (ii) $50,000,000 aggregate
principal amount of Shares is intended to be offered pursuant to the Company’s
dividend reinvestment plan (the “DRIP”). The
Company reserves the right to reallocate the Shares being offered between the
primary offering and the DRIP. Except as described in the Prospectus (as defined
in Section 1.1) or in Section 5.1 hereof, the Shares are to be sold pursuant to
the primary offering for a cash price of $10.00 per Share and the Shares are to
be sold pursuant to the DRIP for the higher of 95% of the estimated fair market
value per share of the Shares or $10.00 per Share.
The
Company hereby appoints Priority Capital Investments, LLC, a Delaware limited
liability company (the “Dealer Manager”), as
its exclusive agent and principal distributor during the Offering Period (as
defined below) for the purpose of selling for cash, on a best efforts basis, the
Shares through such securities dealers that the Dealer Manager may retain
(individually, a “Dealer” and
collectively, the “Dealers”), all of
whom shall be members of the Financial Industry Regulatory Authority, Inc.
(“FINRA”), pursuant to a Participating Broker-Dealer Agreement in the form
attached to this Agreement as Exhibit A (the “Participating Broker-Dealer
Agreement”). The Dealer Manager may also sell Shares for cash directly to
its own clients and customers 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, commencing promptly following the Effective
Date (as defined in Section 1.1) in jurisdictions in which the Shares are
registered or qualified for sale or in which such offering is otherwise
permitted.
The term
“Offering
Period” shall mean that period during which Shares may be offered for
sale, commencing on the date the Registration Statement (as defined in Section
1.1) was filed with the Securities Exchange Commission (the “SEC”), during which
period offers and sales of the Shares shall occur continuously unless and until
the Offering is terminated, except that the Dealer Manager and the Dealers shall
immediately suspend or terminate the offering of the Shares upon request of the
Company at any time and shall resume offering the Shares upon subsequent request
of the Company. The Offering Period shall in all events terminate upon the sale
of all of the Shares. Upon termination of the Offering Period, the Dealer
Manager’s agency and this Agreement shall terminate without obligation on the
part of the Dealer Manager or the Company except as set forth in this
Agreement.
In
connection with the sale of Shares, the Company hereby agrees with you, the
Dealer Manager, as follows:
1. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY
. As
an inducement to the Dealer Manager to enter into this Agreement, the Company
represents and warrants to the Dealer Manager that:
1.1 The
Company has prepared and filed with the SEC a registration statement on Form
S-11 for the registration of the Shares under the Securities Act of 1933, as
amended (the
“Securities Act”), and
the applicable rules and regulations of the SEC promulgated thereunder (the
“Securities Act Rules
and Regulations”). Copies of such registration statement as initially
filed and each amendment thereto have been or will be delivered to the Dealer
Manager. The registration statement on Form S-11 and the prospectus contained
therein, as finally amended at the effective date of the registration statement
(the “Effective
Date”), are respectively hereinafter referred to as the “Registration
Statement” and the “Prospectus,” except
that if the Company files a prospectus or prospectus supplement pursuant to Rule
424(b) under the Securities Act, or if the Company files a post-effective
amendment to the Registration Statement, the term “Prospectus” includes the
prospectus filed pursuant to Rule 424(b) and any prospectus included in
such post-effective amendment. The term “Preliminary
Prospectus” as used herein shall mean a preliminary prospectus related to
the Shares as contemplated by Rule 430 or Rule 430A of the Securities Act Rules
and Regulations included at any time as part of the Registration
Statement.
1.2 On the
date that any Preliminary Prospectus was filed with the SEC, on the Effective
Date, on the date of the Prospectus and when any post-effective amendment to the
Registration Statement becomes effective or any amendment or supplement to the
Prospectus is filed with the SEC, the Registration Statement and the Prospectus,
including the financial statements contained therein, complied or will comply
with the Securities Act and the Securities Act Rules and Regulations. On the
Effective Date, the Registration Statement did not or will not, as the case may
be, contain any untrue statement of a material fact or omit to state any
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. On the date of the Prospectus, as amended or supplemented,
as applicable, the Prospectus did not or will not, as the case may be, contain
any untrue statement of a material fact or omit to state any 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; provided, however, that the foregoing provisions of this Section 1.2
will not extend to such statements contained in or omitted from the Registration
Statement or the Prospectus, as amended or supplemented, as are primarily within
the knowledge of the Dealer Manager or any of the Dealers or are based upon
information furnished by the Dealer Manager in writing to the Company
specifically for inclusion therein.
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1.3 No order
preventing or suspending the use of the Prospectus has been issued and no
proceedings for that purpose are pending, threatened, or, to the knowledge of
the Company, contemplated by the SEC; and to the knowledge of the Company, no
order suspending the offering of the Shares in any jurisdiction has been issued
and no proceedings for that purpose have been instituted or threatened or are
contemplated.
1.4 The
Company intends to use the funds received from the sale of the Shares as set
forth in the Prospectus.
1.5 The
Company has been duly organized and is validly existing as a corporation under
the laws of the state of Maryland, with the full power and authority to conduct
its business as described in the Prospectus, and 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 contribution provisions
contained in Section 6 of this Agreement may be limited under applicable
securities laws.
1.6 The
execution and delivery of this Agreement, the consummation of the transactions
herein contemplated and the compliance with the terms of this Agreement by the
Company will not conflict with or constitute a default or violation under any
charter, by-law, 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 contribution provisions
contained in Section 6 of this Agreement may be limited under applicable
securities laws.
1.7 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 the securities laws of certain
states, if any, that the Company identifies to the Dealer Manager.
1.8 The
Shares 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.
1.9 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.
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2. REPRESENTATIONS
AND WARRANTIES OF THE DEALER MANAGER.
As an
inducement to the Company to enter into this Agreement, the Dealer Manager
represents and warrants to the Company that:
The
Dealer Manager is, and during the term of this Agreement will be, a member of
FINRA in good standing and a broker-dealer registered as such under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”) and
under the securities laws of the states in which the Shares are to be offered
and sold. The Dealer Manager and its employees and representatives possess all
required licenses and registrations to act under this Agreement. The Dealer
Manager will comply with all applicable laws, rules, regulations and
requirements of the Securities Act, the Exchange Act, other federal securities
laws, state securities laws and the rules of FINRA, specifically including, but
not in any way limited to, Conduct Rules 2340, 2420, 2730, 2740 and 2750 of the
National Association of Securities Dealers, Inc. Each Dealer and each
salesperson acting on behalf of the Dealer Manager or a Dealer will be
registered with FINRA and duly licensed by each state regulatory authority in
each jurisdiction in which it, he or she will offer and sell
Shares.
The
Dealer Manager was duly organized and is validly existing as a limited liability
company in good standing under the laws of the State of Delaware, and has full
legal right, power and authority to enter into this Agreement and to perform the
transactions contemplated hereby, and the Dealer Manager has duly authorized,
executed and delivered this Agreement.
2.1 This
Agreement, when executed by the Dealer Manager, will have been duly authorized
and will be a valid and binding agreement of the Dealer Manager, enforceable in
accordance with its terms, except to the extent that the enforceability of the
indemnity and contribution provisions contained in Section 6 of this Agreement
may be limited under applicable securities laws.
2.2 The
execution and delivery of this Agreement, the consummation of the transactions
herein contemplated and the compliance with the terms of this Agreement by the
Dealer Manager will not conflict with or constitute a default or violation under
any charter, by-law, contract, 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 Dealer
Manager.
2.3 No
consent, approval, authorization or other order of any governmental authority is
required in connection with the execution, delivery or performance by the Dealer
Manager of this Agreement.
2.4 The
Dealer Manager represents and warrants to the Company 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, or the Prospectus, 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.
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2.5 The
Dealer Manager has reasonable grounds to believe, based on information made
available to it by the Company, that the Prospectus discloses all material facts
adequately and accurately and provides an adequate basis for evaluating an
investment in the Shares.
3. COVENANTS
OF THE COMPANY
The
Company covenants and agrees with the Dealer Manager that:
3.1 It 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. 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;
(b) this Agreement; and (c) any other printed sales literature or
other materials (provided that the use of said sales literature and other
materials have been first approved for use by the Company and all appropriate
regulatory agencies). It also will furnish to the Dealer Manager and
its designees copies of any material deemed necessary by the Dealer Manager and
commercially reasonable for the Company to furnish, for due diligence purposes
in connection with the Offering.
3.2 It will
furnish such 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.
3.3 It will:
(a) furnish copies of any proposed amendment or supplement of the
Registration Statement or the Prospectus to the Dealer Manager; (b) file
every amendment or supplement to the Registration Statement or the Prospectus
that may be required by the SEC or any state securities administration; and
(c) if at any time the SEC shall issue any stop order suspending the
effectiveness of the Registration Statement or any state securities
administration shall issue any order or take other action to suspend or enjoin
the sale of the Shares, it will promptly notify the Dealer Manager and will use
its best efforts to obtain the lifting of such order or to prevent such other
action at the earliest possible time.
3.4 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 would include an untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, 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 amendment or supplement to the Prospectus that will
correct such statement or omission.
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3.5 It will
comply with all requirements imposed upon it by the Securities Act, the
Securities Act Rules and Regulations, the Exchange Act and the applicable rules
and regulations of the SEC promulgated thereunder (the “Exchange Act Rules and
Regulations” and collectively with the Securities Act Rules and
Regulations, the “Rules and
Regulations”), and by all state securities laws and regulations of those
states in which an exemption has been obtained or qualification of the Shares
has been effected, to permit the continuance of offers and sales of the Shares
in accordance with the provisions hereof and of the Prospectus.
3.6 All
expenses incident to the performance of the Company’s obligations under this
Agreement, including (a) the preparation, filing and printing of the
Registration Statement as originally filed and of each amendment thereto,
(b) the preparation, printing and delivery to the Dealer Manager of this
Agreement, the Participating Broker-Dealer Agreement and such other documents as
may be required in connection with the offering, sale, issuance and delivery of
the Shares, (c) the fees and disbursements of the Company’s counsel,
accountants and other advisers, (d) the fees and expenses related to the
review of the terms and fairness of the Offering by FINRA, (e) the fees and
expenses related to the qualification of the Shares under the securities laws in
accordance with the provisions of Section 3.2 hereof, including the fees and
disbursements of counsel in connection with the preparation of any “blue sky”
survey and any supplement thereto, if any, (f) the printing and delivery to
the Dealer Manager of copies of the Prospectus, (g) the fees and expenses
of any registrar, transfer agent or paying agent in connection with the Shares
and (h) the costs and expenses of the Company relating to investor
presentations undertaken in connection with the marketing of the offering of the
Shares, including, without limitation, expenses associated with the production
of slides and graphics, fees and expenses of any consultants engaged in
connection with presentations with the prior approval of the Company, and travel
and lodging expenses of the representatives of the Company and any such
consultants, will be paid for by the Company or, to the extent such expenses
exceed 1.0% of the gross offering proceeds received by the Company in the
offering, by Pacific Office Management, Inc., a Delaware corporation and the
Company’s advisor (the “Advisor”).
3.7 It will
deliver to the Dealer Manager copies of each written communication delivered to
the holders of Shares (“Stockholders”),
including but not limited to reports as described in the Prospectus under
“Reports to Stockholders,” at the time that such communications are furnished to
the Stockholders, and such other information concerning the Company as the
Dealer Manager may reasonably request from time to time.
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4. COVENANTS
OF THE DEALER MANAGER
The Dealer Manager
covenants and agrees with the Company that:
4.1 In
connection with the offer and sale of the Shares, the Dealer Manager will comply
with all requirements imposed upon it by the Securities Act, the Exchange Act,
the Rules and Regulations or other federal regulations applicable to the
Offering, the sale of Shares or its activities and by all applicable state
securities laws and regulations and the rules of FINRA, as from time to time in
effect, and by this Agreement, including the obligation to deliver a copy of the
Prospectus as required by the Securities Act, the Exchange Act or the Rules and
Regulations. The Dealer Manager will not make any sales of the Shares in any
jurisdiction unless and until it has been
advised that the Shares are either registered in accordance with, or exempt
from, the securities and other laws applicable thereto.
4.2 The
Dealer Manager will make no representations concerning the Offering except as
set forth in the Prospectus.
4.3 The
Dealer Manager will provide the Company with such information relating to the
offer and sale of the Shares by it as may be requested to enable the Company to
prepare such reports of sale as may be required to be filed under applicable
federal or state securities laws.
4.4 All
engagements of the Dealers will be evidenced by a Participating Broker-Dealer
Agreement, except when the Dealer Manager obtains the prior written consent of
the Company. When Dealers are used in this Offering, the Dealer Manager will use
commercially reasonable efforts to cause such Dealers to comply with all their
respective obligations pursuant to the Participating Broker-Dealer
Agreement.
4.5 The
Company may also provide the Dealer Manager with certain supplemental sales
material to be used by the Dealer Manager and the Dealers in connection with the
solicitation of purchasers of the Shares. In the event the Dealer Manager elects
to use such supplemental sales material, the Dealer Manager agrees that such
material shall not be used in connection with the solicitation of purchasers of
the Shares unless accompanied or preceded by the Prospectus, as then currently
in effect, and as it may be amended or supplemented in the future. The Dealer
Manager agrees that it will not use any sales materials in conjunction with the
offer and sale of the Shares other than those either provided to the Dealer
Manager by the Company or approved by the Company for use in the Offering. The
use of any other sales material is expressly prohibited.
4.6 The
Dealer Manager will comply in all material respects with the subscription
procedures and “Plan of Distribution” set forth in the Prospectus.
5. COMPENSATION
OF DEALER MANAGER
5.1 Except as
may be 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 selling commission equal to 7.0% of the
$10.00 per Share cash price for Shares sold in the primary offering plus a
dealer manager fee of 3.0% of the $10.00 per Share cash price for Shares sold in
the primary offering.
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No
selling commissions or dealer manager fees will be paid in connection with
Shares sold under the DRIP.
The
Company will not be liable or responsible to any Dealer for direct payment of
commissions to such Dealer, it being the sole and exclusive responsibility of
the Dealer Manager for payment of commissions to Dealers.
Notwithstanding
anything to the contrary herein, in the event the Offering terminates prior to
completion, the Company will not pay any compensation to the Dealer Manager or
any Dealer in connection with the Offering, except for shares actually sold and
issued to investors and provided, however, that the Company may reimburse the
Dealer Manager and/or a Dealer for of out-of-pocket accountable expenses
actually incurred by the Dealer Manager and/or a Dealer.
5.2 Notwithstanding
anything to the contrary contained herein, in the event that the Company pays
any commission to the Dealer Manager for sale by a Dealer of one or more Shares
and the subscription is rescinded as to one or more of the Shares covered by
such subscription, the Company shall decrease the next payment of commissions or
other compensation otherwise payable to the Dealer Manager by the Company under
this Agreement by an amount equal to the commission rate established in Section
5.1 of this Agreement, multiplied by the number of Shares as to which the
subscription is rescinded. In the event that no payment of commissions or other
compensation is due to the Dealer Manager after such withdrawal occurs, the
Dealer Manager shall pay the amount specified in the preceding sentence to the
Company within ten (10) days following receipt of notice by the Dealer
Manager from the Company stating the amount owed as a result of rescinded
subscriptions.
5.3 In no
event shall the total aggregate underwriting compensation payable to the Dealer
Manager and any Dealers participating in the Offering, including, but not
limited to, selling commissions and the dealer manager fees exceed 10.0% of
gross proceeds from the Offering in the aggregate.
6. INDEMNIFICATION
6.1 The
Company will indemnify and hold harmless (to the extent permitted by the
Company’s charter) 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 (the “Indemnified Persons”)
from and against any losses, claims, damages or liabilities (“Losses”), joint or
several, to which such Indemnified Persons may become subject, under the
Securities Act or otherwise, insofar as such Losses (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 in the Registration Statement
or any post-effective amendment thereto or in the Prospectus or (b) the
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6.2 The
Dealer Manager will indemnify and hold harmless the Company, each director of
the Company (including any person named in the Registration Statement, with his
consent, as about to become a director), each other person who has signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act (each a “Company Indemnitee”),
from and against any Losses to which any of the Company Indemnitees may become
subject, under the Securities Act or otherwise, insofar as such Losses (or
actions in respect thereof) arise out of or are based upon (a) any untrue
statement of a material fact contained in the Registration Statement (including
the Prospectus as a part thereof) or any post-effective amendment thereto or
(b) the omission to state in the Registration Statement (including the
Prospectus as a part thereof) or any post-effective amendment thereto, 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
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6.3 Each
Dealer severally will indemnify and hold harmless the Company, the Dealer
Manager, each of their directors (including any person named in the Registration
Statement, with his consent, as about to become a director), each other person
who has signed the Registration Statement and each person, if any, who controls
the Company and the Dealer Manager within the meaning of Section 15 of the
Securities Act (each, a “Dealer Indemnified
Person”) from and against any Losses to which a Dealer Indemnified Person
may become subject, under the Securities Act or otherwise, insofar as such
Losses (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 in the Registration Statement (including the Prospectus as a part
thereof) or any post-effective amendment thereto, or (b) the omission or
alleged omission to state in the Registration Statement (including the
Prospectus as a part thereof) or any post-effective amendment thereto, 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, or in 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 the case of each of
clauses (a)-(c) 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 the Registration
Statement or any such post-effective amendments thereto or any such Preliminary
Prospectus, or (d) any unauthorized use of sales materials or use of
unauthorized verbal representations concerning the Shares by such Dealer or
Dealer’s representatives or agents in violation of Section VI of the
Participating Broker-Dealer Agreement or otherwise. Each such Dealer will
reimburse each Dealer Indemnified Person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such Loss, expense or action. This indemnity agreement will be in addition to
any liability that such Dealer may otherwise have.
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6.4 Promptly
after receipt by an indemnified party under this Section 6 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 6,
notify in writing the indemnifying party of the commencement thereof. The
failure of an indemnified party so to notify the indemnifying party will relieve
the indemnifying party from any liability under this Section 6 as to the
particular item for which indemnification is then being sought, but
not from any other liability that 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 6.5) 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. Any indemnified party shall not be bound to perform or
refrain from performing any act pursuant to the terms of any settlement of any
claim or action effected without the consent of such indemnified
party.
6.5 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 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 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.
7. SURVIVAL
OF PROVISIONS
7.1 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 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 (b) the acceptance of any payment for the Shares.
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7.2 The
obligations of the Company to pay the Dealer Manager pursuant to Section 5.1 of
this Agreement, and the provisions of Section 5.2, Sections 6 through 10 and
Sections 11 and 16 of this Agreement shall survive the termination of this
Agreement.
8. APPLICABLE
LAW. This
Agreement was executed and delivered in, and its validity, interpretation and
construction shall be governed by, the laws of the State of California;
provided, however, that causes of action for violations of federal or state
securities laws shall not be governed by this section.
9. 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.
10.1 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.
10.2 This
Agreement may only be amended by the written agreement of the Dealer Manager and
the Company.
11. TERM.
11.1 Any party
to this Agreement shall have the right to terminate this Agreement on 60 days’
written notice.
11.2 In any
case, this Agreement shall terminate at the close of business on the effective
date that the Offering terminates.
11.3 In
addition to any other obligations of the Company that survive the expiration or
termination of this Agreement, the Company, upon expiration or termination of
this Agreement, shall pay to the Dealer Manager all commissions and fees to
which the Dealer Manager is or becomes entitled under Section 5.1 of this
Agreement at such time or times as such commissions and fees become payable
pursuant to this Agreement.
12. CONFIRMATION. The
Company hereby agrees and assumes the duty to confirm on its behalf and on
behalf of Dealers and the Dealer Manager all orders for purchase of Shares
accepted by the Company. Such confirmations will comply with the rules of the
SEC and FINRA.
13. SUITABILITY
OF INVESTORS; COMPLIANCE WITH PRIVACY AND ANTI-MONEY LAUNDERING
REGULATIONS.
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13.1 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 comply, and in its agreements with Dealers, the Dealer Manager will
require that the Dealers comply, with the provisions of all applicable rules and
regulations relating to suitability of investors. In making the
determinations as to suitability, the Dealer Manager may rely on representations
from (i) investment advisers who are not affiliated with a Dealer or
(ii) banks acting as trustees or fiduciaries.
13.2 The
Company, the Dealer Manager and each Dealer shall: (x) abide by and comply
with (i) the privacy standards and requirements of the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇
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; and (y) refrain from the use or disclosure of
nonpublic personal information (as defined under the GLB Act) of all
customers.
13.3 The
Company, the Dealer Manager and each Dealer agree to comply with the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (the “USA Patriot Act”) and any applicable U.S.
Department of Treasury regulations issued thereunder that require reasonable
efforts to verify the identity of new customers, maintain customer records, and
check the names of new customers against the list of Specially Designated
Nationals and Blocked Persons. In addition, the Company, the Dealer Manager, and
each Dealer agree to comply with all Executive Orders and federal regulations
administered by the U.S. Department of Treasury Department’s Office of
Foreign Asset Control. Further, the Dealer Manager agrees, upon receipt of an
“information request” issued under Section 314 (a) of the USA Patriot Act,
to provide the Financial Crimes Enforcement Network with information regarding:
(i) the identity of a specified individual or organization;
(ii) account number; (iii) all identifying information provided by the
account holder; and (iv) the date and type of transaction. The Dealer
Manager from time to time will monitor account activity to identify patterns of
unusual size or volume, geographic factors, and any other potential signals of
suspicious activity, including possible money laundering or terrorist financing.
The Company reserves the right to reject account applications from new customers
who fail to provide necessary account information or who intentionally provide
misleading information.
14. SUBMISSION
OF ORDERS.
14.1 Those
persons who purchase Shares will be instructed by the Dealer Manager or the
Dealer to make their checks payable to “Pacific Office Properties Trust,
Inc.” The Dealer Manager may authorize certain Dealers that have “net
capital,” as defined in the applicable federal securities regulations, of
$250,000 or more, 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 made payable
to the order of the Company for the aggregate amount of the subscription
proceeds or wire such funds to the Company. The Dealer Manager and any Dealer
receiving a check that does not conform to the foregoing instructions shall
promptly return such check directly to such subscriber. Checks received by the
Dealer Manager or Dealer that conform to the foregoing instructions shall be
transmitted for deposit pursuant to one of the methods described in this Section
14 and in accordance with the requirements set forth in Rule 15c2-4 promulgated
under the Exchange Act.
13
14.2 It is
understood and agreed that the Company reserves the right in its sole discretion
to refuse to sell any of the Shares to any person. A sale of a Share shall be
deemed to be completed if and only if (i) the Company has received a
properly completed and executed subscription documents, together with payment of
the full purchase price of each purchased Share, from or on behalf of an
investor who satisfies the applicable suitability standards and
minimum purchase requirements set forth
in the Registration Statement as determined by the Dealer Manager in accordance
with the provisions of this Agreement and (ii) the Company has accepted
such subscription.
15. SEVERABILITY. If
any portion of this Agreement shall be held invalid or inoperative, then so far
as is reasonable and possible the remainder of this Agreement shall be
considered valid and operative and effect shall be given to the intent
manifested by the portion held invalid or inoperative.
16. NOTICES. All
communications hereunder, except as herein otherwise specifically provided,
shall be sufficiently given or made if sent by hand delivery, national
commercial courier service for next day delivery, United States mail,
first-class, postage prepaid, addressed or sent by facsimile. Notice
delivered by hand or by commercial courier shall be effective at the time of
delivery. Notice deposited by mail shall be effective 48 hours after such
deposit. Notice delivered by facsimile shall be effective at the time evidenced
on the written confirmation of delivery:
If to the
Company: Pacific
Office Properties Trust, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇
▇▇▇
Santa Monica, CA 90401
Facsimile No.:
________________________
Attention: President
and Chief Executive Officer
With a copy to (which shall not
constitute notice):
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇
▇▇▇▇
Chicago, Illinois 60606
Facsimile No.:
________________________
Attention:
14
If to the
Dealer
Manager: Priority
Capital Investments, LLC
10188 Telesis Court
Suite 130
San Diego, CA 92121
Facsimile
No.:
Attention: Operational
Manager
With a copy to (which shall not
constitute notice):
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇,
LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Atlanta, GA 30326
Facsimile No.: (▇▇▇)
▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Esq.
Any party
may change its address specified above by giving the other party notice of such
change in accordance with this Section 16.
17. DELAY. Except
as expressly provided otherwise in this Agreement, neither the failure nor any
delay on the part of any party to this Agreement to exercise any right, remedy,
power or privilege under this Agreement shall operate as a waiver thereof, nor
shall a waiver of any right remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power, or privilege
with respect to any subsequent occurrence.
18. NO
PARTNERSHIP. Nothing
in this Agreement shall be construed or interpreted to constitute the Dealer
Manager as in association with or in partnership with the Company, and instead,
this Agreement only shall constitute the Dealer Manager as a broker-dealer
authorized by the Company to sell and to manage the sale by others of the Shares
according to the terms set forth in the Registration Statement, the Prospectus
or this Agreement.
19. NO
THIRD PARTY BENEFICIARIES. Except
as expressly provided otherwise in this Agreement, no provision of this
Agreement is intended to be for the benefit of any person or entity not a party
to this Agreement, and no third party shall be deemed to be a beneficiary of any
provision of this Agreement. Further, no third party shall, by virtue of any
provision of this Agreement, have a right of action or an enforceable remedy
against either party to this Agreement.
20.
ENTIRE AGREEMENT. This
Agreement contains the entire agreement and understanding among the parties
hereto with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements, understandings, inducements and conditions, express
or implied, oral or written, of any nature whatsoever with respect to the
subject matter hereof. The express terms hereof control and supersede any course
of performance and/or usage of the trade inconsistent with any of the terms
hereof. This Agreement may not be modified or amended other than by an agreement
in writing.
15
[SIGNATURE
PAGE FOLLOWS]
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,
By:
▇▇▇ ▇. ▇▇▇▇▇▇▇
President and Chief Executive
Officer
Accepted
and agreed as of the date first above written.
Priority
Capital Investments, LLC
By:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Operational Manager
[SIGNATURE
PAGE TO DEALER MANAGER AGREEMENT]
Up
to 40,000,000 Shares of Senior Common Stock
PARTICIPATING
BROKER-DEALER AGREEMENT
Ladies
and Gentlemen:
Priority
Capital Investments, LLC, a Delaware limited liability company, as the dealer
manager (“Dealer
Manager”) for Pacific Office Properties Trust, Inc., a Maryland
corporation (the “Company”), invites you (“Dealer”) to participate in the
distribution of shares of senior common stock (“Shares”) of the Company
subject to the following terms. Capitalized terms not otherwise defined herein
shall have the meanings set forth in the Dealer Manager Agreement between the
Dealer Manager and the Company dated _________________, 2010 in the form
attached hereto as Exhibit “A” (the “Dealer Manager
Agreement”).
By
Dealer’s acceptance of this Agreement, Dealer will become one of the Dealers
referred to in the Dealer Manager Agreement and will be entitled and subject to
the terms and conditions of the Dealer Manager Agreement, including, but not
limited to, Section 6.3 of the Dealer Manager Agreement wherein the Dealers
severally agree to indemnify and hold harmless the Dealer Indemnified
Persons.
Dealer
hereby agrees to use its best efforts to sell the Shares for cash on the terms
and conditions stated in the Prospectus. Nothing in this Agreement shall be
deemed or construed to make Dealer an employee, agent, representative or partner
of the Dealer Manager or of the Company, and Dealer is not authorized to act for
the Dealer Manager or the Company or to make any representations on their behalf
except as set forth in the Prospectus and such other printed information
furnished to Dealer by the Dealer Manager to supplement the Prospectus (“Supplemental
Information”).
II.Submission of Orders
Dealer
hereby agrees to solicit, as an independent contractor and not as the agent of
the Dealer Manager or of the Company (or their affiliates), persons acceptable
to the Company to purchase the Shares pursuant to the subscription agreement in
the form attached to the Prospectus and in accordance with the terms of the
Prospectus. Dealer hereby agrees to diligently make inquiries as required by
this Agreement, as set forth in the Prospectus, and as required by all
applicable laws of all prospective investors in order to ascertain whether a
purchase of the Shares is suitable for each such investor.
Those
persons who purchase Shares will be instructed by the Dealer to make their
checks payable to “Pacific Office Properties Trust, Inc.” Checks
received by the Dealer which conform to the foregoing instructions shall be
transmitted for deposit pursuant to one of the following methods:
1. Where,
pursuant to the Dealer’s internal supervisory procedures, internal supervisory
review is conducted at the same location at which subscription documents and
checks are received from subscribers, checks will be transmitted by the end of
the next business day following receipt by Dealer for deposit to the
Company.
2. Where,
pursuant to the Dealer’s internal supervisory procedures, final internal
supervisory review is conducted at a different location, checks will be
transmitted by the end of the next business day following receipt by Dealer to
the office of the Dealer conducting such final internal supervisory review (the
“Final Review Office”).
The Final Review Office will in turn by the end of the next business day
following receipt by the Final Review Office, transmit such checks for deposit
to the Company.
III.Pricing
Except as
described in the Prospectus, up to $400,000,000 aggregate principal amount of
Shares shall be offered to the public, of which up to (i) $350,000,000 aggregate
principal amount of Shares is intended to be offered to the public at the
offering price of $10.00 per Share, payable in cash pursuant to the primary
offering and (ii) $50,000,000 aggregate principal amount of Shares is intended
to be offered pursuant to the Company’s DRIP at the higher of 95% of the
estimated fair market value per shares of a Share, as estimated by the Company’s
board of directors, or $10.00 per Share. Except as otherwise
indicated in the Prospectus or in any letter or memorandum sent to the Dealer by
the Company or Dealer Manager, a minimum initial purchase of $5,000, is
required. Except as otherwise indicated in the Prospectus, additional
investments may be made in cash in minimal increments of at least
$500. The Shares are nonassessable.
Except
for discounts described in or as otherwise provided in the “Plan of
Distribution” section of the Prospectus, Dealer’s selling commission applicable
to the total public offering price of Shares sold in the primary offering by
Dealer that it is authorized to sell hereunder is 7.0% of the gross proceeds of
the Shares sold by it and accepted and confirmed by the Company, which
commissions will be paid by the Dealer Manager. For these purposes, a
“sale of 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. The Dealer affirms that the
Dealer Manager’s liability for commissions payable is limited solely to the
proceeds of commissions receivable associated therewith, and the 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.
No selling commissions or a dealer
manager fee will be paid in connection with ▇▇▇▇▇▇ sold under the
DRIP.
Except as
otherwise provided herein, all expenses incurred by Dealer in the performance of
Dealer’s obligations hereunder, including, but not limited to, expenses related
to the Offering and any attorneys’ fees, shall be at Dealer’s sole cost and
expense, and the foregoing shall apply notwithstanding the fact that the
Offering is not consummated for any reason.
In
addition, as set forth in the Prospectus, the Dealer Manager may, in its sole
discretion, reallow a portion of the dealer manager fee to a
Dealer. The Dealer Manager will also reimburse bona fide due
diligence expenses of a Dealer. Reimbursement requests for accountable bona fide
due diligence expenses must be made by Dealer within six months of the date of
sale of Shares or such requests will not be honored by the Dealer
Manager.
2
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 Shares, that Dealer’s interest in the Offering is
limited to such commission from the Dealer Manager and 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 the Dealer.
Payments
of selling commissions will be made by the Dealer Manager to Dealer within
10 days of the receipt by the Dealer Manager of the gross commission
payments from the Company. Dealer acknowledges that if the Company pays selling
commissions to the Dealer Manager, the Company is relieved of any obligation for
selling commissions to Dealer. The Company may rely on and use the preceding
acknowledgment as a defense against any claim by Dealer for selling commissions
Company pays to Dealer Manager but that Dealer Manager fails to remit to
Dealer.
VI.Covenants of Dealer
Prior to
participating in the Offering, Dealer will have reasonable grounds to believe,
based on information made available to Dealer by the Dealer Manager and/or the
Company through the Prospectus, that all material facts are adequately and
accurately disclosed in the Prospectus and provide a basis for evaluating an
investment in the Company and the Shares.
▇▇▇▇▇▇
agrees not to rely upon the efforts of the Dealer Manager, which is affiliated
with the Company, in determining whether the Company has adequately and
accurately disclosed all material facts upon which to provide a basis for
evaluating the Company to the extent required by federal or state laws or FINRA.
▇▇▇▇▇▇ further agrees to conduct its own investigation to make that
determination independent of the efforts of the Dealer Manager.
Dealer
agrees to retain in its records and make available to the Dealer Manager and to
the Company for a period of at least six (6) years following the
termination of the Offering, information establishing that each investor who
purchases the Shares solicited by Dealer is suitable for such
investment.
Dealer
agrees that, prior to accepting a subscription for the Shares, it will inform
the prospective investor of all pertinent facts relating to the illiquidity and
lack of marketability of the Shares, as appropriate, during the term of the
investment.
Dealer
hereby undertakes and agrees to comply with all obligations applicable to Dealer
under all applicable laws, rules and regulations, including those set forth by
FINRA. In soliciting persons to acquire the Shares, Dealer further agrees to
comply with any applicable requirements of the Securities Act, the Exchange Act,
other applicable federal securities laws, applicable state securities laws, the
rules and regulations promulgated thereunder and the rules of FINRA and, in
particular, Dealer agrees that it will not give any information or make any
representations other than those contained in the Prospectus and in any
supplemental sales literature furnished to Dealer by the Dealer Manager for use
in making such solicitations.
VII.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 order. Orders not accompanied by a Subscription Signature Page and
the required check in payment for the Shares may be rejected. Issuance and
delivery of the Shares will be made only after actual receipt of payment
therefore. If any check 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 Shares within 15 days of sale, the
Company reserves the right to cancel the sale without notice. In the event an
order is rejected, canceled or rescinded for any reason, the Dealer agrees to
return to the Dealer Manager any commission theretofore paid with respect to
such order.
3
Dealer is
not authorized or permitted to give, and will not give, any information or make
any representation concerning the Shares except as set forth in the Prospectus
and the Supplemental Information. The Dealer Manager will supply Dealer with
reasonable quantities of the Prospectus, as well as any Supplemental
Information, for delivery to investors, and Dealer will deliver a copy of the
Prospectus as required by the Securities Act, the Exchange Act, and the Rules
and Regulations. The Dealer agrees that it will not send or give any
Supplemental Information to an investor unless it has previously sent or given a
Prospectus to that investor or has simultaneously sent or given a Prospectus
with such Supplemental Information. Dealer agrees that it will not show or give
to any investor or prospective Investor or reproduce any material or writing
that is supplied to it by the Dealer Manager and marked “dealer only” or
otherwise bearing a legend denoting that it is not to be used in connection with
the sale of Shares to members of the public. Dealer agrees that it will not use
in connection with the offer or sale of Shares any material or writing that
relates to another company supplied to it by the Company or the Dealer Manager
bearing a legend that states that such material may not be used in connection
with the offer or sale of any securities of the Company. Dealer further agrees
that it will not use in connection with the offer or sale of Shares any
materials or writings that have not been previously approved by the Dealer
Manager. Each Dealer agrees, if the Dealer Manager so requests, 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
Securities Exchange Act of 1934. Regardless of the termination of this
Agreement, Dealer will deliver a Prospectus in transactions in the 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 or the Exchange Act
Rules and Regulations thereunder.
IX.License and Association Membership
Dealer’s
acceptance of this Agreement constitutes a representation to the Company and the
Dealer Manager that Dealer is a broker-dealer properly registered with the SEC,
duly authorized to sell Shares under federal and state securities laws and
regulations and in all states where it offers or sells Shares, and that it is a
member in good standing of FINRA. This Agreement shall automatically terminate
if the Dealer ceases to be a member in good standing of FINRA. ▇▇▇▇▇▇
agrees to notify the Dealer Manager immediately if Dealer ceases to be a member
in good standing.
X.Anti-Money Laundering Compliance
Programs
Dealer’s
acceptance of this Agreement constitutes a representation to the Company and the
Dealer Manager that Dealer has established and implemented anti-money laundering
compliance programs in accordance with FINRA Rule 3011, Section 352 of
the Money Laundering Abatement Act and Sections 103.19, 103.35, and 103.122
of the regulations of the U.S. Treasury Department, and is in compliance with
all Executive Orders and Federal Regulations administered by the U.S. Treasury
Department’s Office of Foreign Assets Control. Further, Dealer agrees, upon
receipt of an “information request” issued under Section 314 (a) of
the USA Patriot Act to provide the Financial Crimes Enforcement Network with
information regarding: (i) the identity of a specified individual or
organization; (ii) account number; (iii) all identifying information
provided by the account holder; and (iv) the date and type of transaction.
The Dealer Manager from time to time will monitor account activity to identify
patterns of unusual size or volume, geographic factors, and any other potential
signals of suspicious activity, including possible money laundering or terrorist
financing. The Company and the Dealer Manager reserve the right to reject
account applications from new customers who fail to provide necessary account
information or who intentionally provide misleading information.
4
Dealer
will 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 or the Dealer Manager 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, Dealer will
comply with the provisions of the rules and requirements of FINRA, as well as
all other applicable rules and regulations relating to suitability of investors,
and the suitability standards set forth in the Prospectus.
XII.Termination
Dealer
will suspend or terminate its offer and sale of Shares upon the request of the
Company or the Dealer Manager at any time and will resume its offer and sale of
Shares hereunder upon subsequent request of the Company or the Dealer Manager.
Any party may terminate this Agreement by written notice. Such termination shall
be effective 48 hours after the mailing of such notice. This Agreement and the
exhibits hereto are the entire agreement of the parties and supersede all prior
agreements, if any, relating to the subject matter hereof between the parties
hereto.
This
Agreement may be amended at any time by the Dealer Manager by written notice to
Dealer, and any such amendment shall be deemed accepted by Dealer upon placing
an order for sale of Shares after Dealer has received such notice.
XIII.Privacy Laws
The
Dealer Manager and Dealer (each referred to individually in this section as
“party”) agree as follows:
A. Each
party agrees to abide by and comply with (i) the privacy standards and
requirements of the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act of 1999 (the “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.
XIV.Confidentiality of Due Diligence
Information
Dealer
understands that the Company, Dealer Manager or third party due diligence
providers may from time to time furnish Dealer with certain information which is
non-public, confidential or proprietary in nature (the “Due Diligence Information”) in
connection with its due diligence obligations under FINRA rules and the federal
securities laws. Dealer agrees that the Due Diligence Information
will be kept confidential and shall not, without our prior written consent, be
disclosed by Dealer, or by Dealer’s affiliates, agents, representatives or
employees, in any manner whatsoever, in whole or in part, and shall not be used
by Dealer, its agents, representatives or employees, other than in connection
with Dealer’s due diligence evaluation of the Offering. Dealer agrees
to reveal the Due Diligence Information only to its affiliates, agents,
representatives and employees who need to know the Due Diligence Information for
the purpose of the due diligence evaluation. Further, Dealer and its
affiliates, agents, representatives and employees will not disclose to any
person the fact that the Due Diligence Information has been made available to
it.
5
The term
Due Diligence Information shall not include information which (i) is already in
Dealer’s possession or in the possession of Dealer’s parent company or
affiliates, provided that such information is not known by Dealer to be subject
to another confidentiality agreement with or other obligation of secrecy to the
Company or another party; (ii) is or becomes generally available to the public
other than as a result of a disclosure by Dealer, its affiliates, or their
respective directors, officers, employees, agents, advisors and representatives
in violation of this agreement; (iii) becomes available to Dealer or its
affiliates on a non-confidential basis from a source other than the Company or
its advisors, provided that such source is not known by Dealer or its affiliates
to be bound by a confidentiality agreement with or other obligation of secrecy
to the Company or another party; or (iv) is independently developed by Dealer or
by its affiliates without use of the Due Diligence Information.
Dealer
agrees that its obligation of non-disclosure, non-use and confidentiality of the
Due Diligence Information as set forth herein shall terminate two (2) years
after the date on which the Due Diligence Information is received by
Dealer.
XV.Notice
All
notices or other communications required or permitted hereunder shall be in
writing and shall be deemed given or delivered: (i) when delivered
personally or by commercial messenger; (ii) one business day following
deposit with a recognized overnight courier service, provided such deposit
occurs prior to the deadline imposed by such service for overnight delivery;
(iii) when transmitted, if sent by facsimile copy, provided confirmation of
receipt is received by sender and such notice is sent by an additional method
provided hereunder, in each case above provided such communication is addressed
to the intended recipient thereof as set forth below:
If to the Dealer
Manager: Priority
Capital Investments, LLC
10188 Telesis Court
Suite 130
San Diego, CA 92121
Facsimile
No.:
Attention: Operational
Manager
If to
Dealer, to the address or facsimile number and address specified by Dealer on
the signature page hereto.
XVI.Attorney’s Fees and Applicable Law
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
California and shall take effect when signed by Dealer and countersigned by the
Dealer Manager.
6
We have
read the foregoing Agreement and we hereby accept and agree to the terms and
conditions set forth therein.
[SIGNATURE
PAGE FOLLOWS]
Participating
Broker-Dealer Agreement
[SIGNATURE
PAGE]
We have
read the foregoing Agreement and we hereby accept and agree to the terms and
conditions set forth therein.
Dealer
Name:
__________________________________________ (as shown in FINRA
records)
Attention:
__________________________________________
Address:
__________________________________________
__________________________________________
City:
__________________________________________
State: ___________ Zip
Code: ________________
Telephone
No.: _____________________________
Facsimile
No.:
_____________________________
E-mail: _____________________________
AGREED TO
AND ACCEPTED BY THE DEALER:
By:
Signature
Printed Name
Title
AGREED TO
AND ACCEPTED BY
THE
DEALER MANAGER:
PRIORITY
CAPITAL INVESTMENTS, LLC
By:
Name: _______________
Title: Operational
Manager