Exhibit 10.4

 

EXCLUSIVE DEALER MANAGER AGREEMENT

 

BUSINESS DEVELOPMENT CORPORATION OF AMERICA II

 

Up to 300,000,000 Shares of Common Stock

 

September 8, 2014

 

Realty Capital Securities, LLC

One Beacon Street, 14th Floor

Boston, Massachusetts 02108

 

Ladies and Gentlemen:

 

Business Development Corporation of America II (the “ Company ”) is a Maryland
corporation that has elected to be treated as a business development company (“
BDC ”) under the Investment Company Act of 1940 and the rules and regulations
thereunder (collectively, the “Investment Company Act”). The Company has
registered for public sale (the “ Offering ”) a maximum of 300,000,000 shares of
common stock, $0.001 par value per share (the “ Shares ”), to be sold to the
public on a “best efforts” continuous basis, for an initial purchase price of
$10.00 per Share (subject in certain circumstances to discounts based upon the
volume of Shares purchased), all upon the other terms and subject to the
conditions set forth in the Prospectus (as defined below). The Company has
reserved the right to (i) change the price per Share in the Offering in order to
ensure that the Shares are not sold at a price, which after deduction of selling
commissions and dealer manager fees, is below the Company’s NAV as described in
the Prospectus.

 

In connection with the Offering, the Company has prepared and filed with the
Securities and Exchange Commission (the “ Commission ”) a registration statement
(File No. 333-197447) on Form N-2 for the registration of the Shares under the
Securities Act of 1933, as amended (the “ Securities Act ”), and the rules and
regulations of the Commission promulgated thereunder (the “ Securities Act Rules
and Regulations ”), and may prepare and file one or more amendments to such
registration statement.

 

The Company is managed by BDCA Adviser II, LLC, a Delaware limited liability
company (the “Adviser”), pursuant to the Investment Advisory and Management
Services Agreement dated August 21, 2014 between the Company and the Adviser
(the “ Advisory Agreement ”) included as an exhibit to the Registration
Statement (as defined below).

 

Upon the terms and subject to the conditions contained in this Exclusive Dealer
Manager Agreement (this “ Agreement ”), the Company hereby appoints Realty
Capital Securities, LLC, a Delaware limited liability company (the “ Dealer
Manager ”), to act as the exclusive dealer manager for the Offering, and the
Dealer Manager desires to accept such engagement.

 

As used in this Agreement, the registration statement on Form N-2 and the
prospectus contained therein, as finally amended at the date the registration
statement is declared effective by the Commission are respectively hereinafter
referred to as the “ Registration Statement ” and the “ Prospectus ,” except
that (i) if the Company files a post-effective amendment to such registration
statement, then the term “Registration Statement” shall, from and after the
declaration of the effectiveness of such post-effective amendment by the
Commission, refer to such registration statement as amended by such
post-effective amendment, and the term “Prospectus” shall refer to the amended
prospectus then on file with the Commission, and (ii) if the Company files a
prospectus or prospectus supplement pursuant to Rule 497 of the Securities Act
Rules and Regulations which differs from the prospectus on file at the time the
Registration Statement or the most recent post-effective amendment thereto, if
any, shall have become effective, then the term “Prospectus” shall refer to such
prospectus or include such prospectus supplement, as applicable, filed pursuant
to Rule 497 of the Securities Act Rules and Regulations, as the case may be,
from and after the date on which it shall have been filed. 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. As used
in this Agreement, the terms “Registration Statement,” “preliminary Prospectus”
and “Prospectus” shall include the documents incorporated by reference therein
pursuant to Instruction F of Form N-2, including any portion of the Company’s
annual report on Form 10-K. As used herein, the term “Effective Date” also shall
refer to the effective date of each post-effective amendment to the Registration
Statement, unless the context otherwise requires.

 

 

 

 

1.Representations and Warranties of the Company and the Adviser. The Company and
the Adviser hereby represent, warrant and agree to the following as of the date
hereof and during the term of this Agreement:

 

(a)Compliance with the Securities Act.

 

i.On (A) each applicable Effective Date, (B) the date of the preliminary
Prospectus, (C) the date of the Prospectus and (D) the date any supplement to
the Prospectus, the Registration Statement, the Prospectus and any amendments or
supplements thereto, as applicable, have complied, and will comply, in all
material respects with the Securities Act, the Securities Act Rules and
Regulations and the Investment Company Act, as it is applicable to BDCs; and

 

ii.The Registration Statement does not, and any amendment thereto will not, in
each case as of the applicable Effective Date, include any untrue statement of
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading and the Prospectus
does not, and any amendment or supplement thereto will not, as of the applicable
filing date, include any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading; provided, however, that the foregoing representations will not
extend to any statements contained in, incorporated by reference in or omitted
from the Registration Statement, the Prospectus or any amendment or supplement
thereto that are based upon written information furnished to the Company by the
Dealer Manager expressly for use therein.

 

(b)Documents Incorporated by Reference. The information from the Company’s
annual reports on Form 10-K specifically incorporated by reference into the
Prospectus, if applicable, will comply in all material respects with the
requirements of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and the rules and regulations of the Commission promulgated thereunder
(the “Exchange Act Rules and Regulations”), and, as of the Effective Date of any
post-effective amendment that includes information incorporated by reference,
such information so incorporated will not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

 

(c)Securities Matters. There has not been (i) any request by the Commission for
any further amendment to the Registration Statement or the Prospectus or for any
additional information, (ii) any issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or any initiation or,
to the Company’s knowledge, threat of any proceeding for that purpose, or (iii)
any notification with respect to the suspension of the qualification of the
Shares for sale in any jurisdiction or any initiation or, to the Company’s
knowledge, threat of any proceeding for such purpose. The Company is in
compliance in all material respects with all federal and state securities laws,
rules and regulations applicable to it and its activities, including, without
limitation, with respect to the Offering and the sale of the Shares.

 

(d)Corporation Status. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Maryland, with all
requisite power and authority to enter into this Agreement and to carry out its
obligations hereunder.

 

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(e)Authorization of Agreement. This Agreement has been duly and validly
authorized, executed and delivered by or on behalf of the Company and
constitutes a valid and binding agreement of the Company enforceable in
accordance with its terms (except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws of the
United States, any state or any political subdivision thereof which affect
creditors’ rights generally or by equitable principles relating to the
availability of remedies or except to the extent that the enforceability of the
indemnity and contribution provisions contained in this Agreement may be limited
under applicable securities laws).

 

The execution and delivery of this Agreement and the performance of this
Agreement, the consummation of the transactions contemplated herein and the
fulfillment of the terms hereof, do not and will not conflict with, or result in
a breach of any of the terms and provisions of, or constitute a default under:
(i) the Company’s charter, bylaws, or other organizational documents, as the
case may be; (ii) any indenture, mortgage, deed of trust, voting trust
agreement, note, lease or other agreement or instrument to which the Company is
a party or by which the Company or any of its properties is bound except, for
purposes of this clause (ii) only, for such conflicts, breaches or defaults that
do not result in and could not reasonably be expected to result in, individually
or in the aggregate, a Company MAE (as defined below in this Section 1(e)); or
(iii) any statute, rule or regulation or order of any court or other
governmental agency or body having jurisdiction over the Company or any of its
properties. No consent, approval, authorization or order of any court or other
governmental agency or body has been or is required for the performance of this
Agreement or for the consummation by the Company of any of the transactions
contemplated hereby (except (y) as have been obtained under the Securities Act,
under the Exchange Act or from the Financial Industry Regulatory Authority, Inc.
(“ FINRA ”) or as may be required under state securities or applicable blue sky
laws in connection with the offer and sale of the Shares, the Company’s
qualification to transact business in such states or as may be required by
subsequent events that may occur, and (z) the election of the Company to be
regulated as a BDC under the Investment Company Act. The Company is not in
violation of its charter, bylaws or other organizational documents.

 

As used in this Agreement, “Company MAE” means any event, circumstance,
occurrence, fact, condition, change or effect, individually or in the aggregate,
that is, or could reasonably be expected to be, materially adverse to (i) the
condition, financial or otherwise, earnings, business affairs or business
prospects of the Company, (ii) the ability of the Company to perform its
obligations under this Agreement or the validity or enforceability of this
Agreement or the Shares or (iii) the value of the Shares.

 

(f)Qualification. Each of the Company and the Adviser has qualified to do
business and is in good standing in every jurisdiction in which the conduct of
its business, as described in the Prospectus, requires such qualification,
except where the failure to do so would not (A) result in a Company MAE and (B)
have a material adverse effect on the condition, financial or otherwise, results
of operations or cash flows of the Adviser or would materially and adversely
affect the regulatory status of the Adviser such that the Adviser would be
prevented from carrying out its obligations under the Advisory Agreement (an
“Adviser MAE”).

 

(g)Actions or Proceedings. 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
would result in a Company MAE. The Company promptly will give notice to the
Dealer Manager of the occurrence of any action, suit, proceeding or
investigation of the type referred to above arising or occurring on or after the
initial Effective Date.

 

(h)Escrow Agreement. The Company has entered into an escrow agreement (the
“Escrow Agreement”) with the Dealer Manager and UMB Bank, N.A. (the “Escrow
Agent”), substantially in the form included as an exhibit to the Registration
Statement, which provides for the establishment of an escrow account (the
“Escrow Account”) to receive and hold subscription funds in respect of Shares of
the Company prior to the Company raising gross offering proceeds of $2,000,000
from Persons (as defined below in this Section 1(h)) (the “Minimum Offering”) as
described in the Prospectus and pursuant to the subscription procedures
described in Section 3 below. As used in this Agreement, “ Person ” or “ Persons
” means any individual, firm, corporation, partnership, trust, incorporated or
unincorporated association, joint venture, joint stock company, limited
liability company, governmental authority or agency, or other entity of any
kind.

 

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(i)Authorization of Shares. The Shares have been duly authorized and, when
issued and sold as contemplated by the Prospectus and upon payment therefor as
provided in this Agreement and the Prospectus, will be validly issued, fully
paid and nonassessable, free and clear of any pledge, lien, encumbrance,
security interest or other claim. The issuance and sale of the Shares by the
Company are not subject to preemptive or other similar rights arising by
operation of law, under the charter or bylaws of the Company or under any
agreement to which the Company is a party or otherwise. The shares will conform
in all material respects to the description thereof contained in the Prospectus.

 

(j)Taxes. The Company has filed all material federal, state and foreign income
tax returns required to be filed by or on behalf of the Company on or before the
due dates therefor (taking into account all extensions of time to file) and has
paid or provided for the payment of all such material taxes indicated by such
tax returns and all assessments received by the Company to the extent that such
taxes or assessments have become due.

 

(k)Preparation of the Financial Statements. The financial statements filed with
the Commission as part of the Registration Statement and included in the
Prospectus present fairly the financial position of the Company as of and at the
dates indicated and the results of their operations and cash flows for the
periods specified. Such financial statements have been prepared in conformity
with generally accepted accounting principles as applied in the United States on
a consistent basis throughout the periods involved, except as may be expressly
stated in the related notes thereto. No other financial statements or supporting
schedules are required to be included in the Registration Statement or any
applicable Prospectus.

 

(l)Independent Registered Public Accounting Firm. Grant Thornton LLP, whose
report on the financial statements of the Company is included in the
Registration Statement and Prospectus, are, and during the period covered by the
report included in the Registration Statement and the Prospectus were,
independent registered public accountants as required by the Securities Act and
the Securities Act Rules and Regulations. Such accountants have not been engaged
by the Company to perform any “prohibited activities” (as defined in Section 10A
of the Exchange Act).

 

(m)Internal Controls. The Company maintains a system of internal accounting and
other controls sufficient to provide reasonable assurances regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting
principles, including policies and procedures that: (i) pertain to the
maintenance of records that in reasonable detail accurately and fairly reflect
the transactions and dispositions of the assets of the Company; (ii) provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures of the Company are
being made only in accordance with authorizations of the Company’s management
and directors; and (iii) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use, or disposition of the
Company’s assets that could have a material effect on the financial statements.

 

(n)Material Adverse Change. Since the respective dates as of which information
is given in the Registration Statement and the Prospectus, except as may
otherwise be stated therein or contemplated thereby, there has not occurred a
Company MAE, whether or not arising in the ordinary course of business.

 

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(o)Government Permits. The Company possesses such certificates, authorities or
permits issued by the appropriate state, federal or foreign regulatory agencies
or bodies necessary to conduct the business now operated by them, other than
those the failure of which to possess or own would not have, individually or in
the aggregate, and could not, individually or in the aggregate, reasonably be
expected to result in a Company MAE. The Company has not received any notice of
proceedings relating to the revocation or modification of any such certificate,
authority or permit which, individually or in the aggregate, if the subject of
an unfavorable decision, ruling or finding, would result in a Company MAE.

 

(p)Adviser and Advisory Agreement.

 

i.The Adviser is a limited liability company duly formed and validly existing
under the laws of the State of Delaware, with all requisite power and authority
to enter into this Agreement and to carry out its obligations hereunder.

 

ii.Each of this Agreement and the Advisory Agreement is duly and validly
authorized, executed and delivered by or on behalf of the Adviser or the
Administrator, as the case may be, and constitutes a valid and binding agreement
of the Adviser, enforceable in accordance with its terms (except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws of the United States, any state or any
political subdivision thereof which affect creditors’ rights generally or by
equitable principles relating to the availability of remedies or except to the
extent that the enforceability of the indemnity and contribution provisions
contained in this Agreement may be limited under applicable securities laws).

 

iii.The terms of the Advisory Agreement, including compensation terms, comply in
all material respects with all applicable provisions of the Investment Company
Act and the Investment Advisers Act of 1940, as amended, and the rules and
regulations thereunder (collectively, the “ Advisers Act ”).

 

iv.The execution and delivery of each of this Agreement and the Advisory
Agreement and the performance thereunder by the Adviser do not and will not (i)
conflict with, or result in a breach of any of the terms and provisions of, or
constitute a default under: (1) the Adviser’s limited liability company
agreement or other organizational documents, or (2) any indenture, mortgage,
deed of trust, voting trust agreement, note, lease or other agreement or
instrument to which the Adviser is a party or by which the Adviser is bound
except, for purposes of this clause (2) only, for such conflicts, breaches or
defaults that could not (A) reasonably be expected to have or result in,
individually or in the aggregate, an Adviser MAE or (B) a Company MAE; or (ii)
result in and could not reasonably be expected to result in, individually or in
the aggregate, in any material respect any conflict with, breach of, or default
under, any statute, rule or regulation or order of any court or other
governmental agency or body having jurisdiction over the Adviser or any of its
properties. No consent, approval, authorization or order of any court or other
governmental agency or body has been or is required for the performance of the
Advisory Agreement by the Adviser except (i) such as have been already obtained
under the Securities Act or the Investment Company Act or (ii) as may be
required under state securities laws. The Adviser is not in violation of its
limited liability company agreements or other organizational documents.

 

v.There is no action, suit, proceeding, inquiry or investigation before or
brought by any court or governmental agency or body, domestic or foreign, now
pending, or, to the knowledge of the Adviser, threatened against or affecting
the Adviser.

 

vi.The Adviser possesses such certificates, authorities or permits issued by the
appropriate state, federal or foreign regulatory agencies or bodies necessary to
conduct the business now operated by it, other than those the failure to possess
or own would not have or result in, individually or in the aggregate, (A) a
material adverse effect on the condition, financial or otherwise, earnings,
business affairs or business prospects of the Adviser, (B) a Company MAE, or (C)
an Adviser MAE, and the Adviser has not received any notice of proceedings
relating to the revocation or modification of any such certificate, authority or
permit.

 

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(q)Business Development Company Requirements.

 

i.The Company’s current business operations and investments and contemplated
business operations and investments are in compliance in all material respects
with the provisions of the Investment Company Act as it is applicable to BDCs,
except as will not result, individually or in the aggregate, in a Company MAE.

 

ii.Except as disclosed in the Registration Statement and the Prospectus, no
Person is serving or acting as an officer, director or investment adviser of the
Company, except in accordance with the provisions of the Investment Company Act
and the Advisers Act and the applicable published rules and regulations
thereunder.

 

iii.The provisions of the charter and bylaws of the Company and the investment
objectives, policies and restrictions described in the Prospectus are and will
be consistent in all material respects with the requirements of the Investment
Company Act applicable to a BDC.

 

iv.The approval of the Advisory Agreement by each of the board of directors and
the initial stockholders of the Company has been made in accordance with the
requirements of Section 15 of the Investment Company Act applicable to companies
that have elected to be regulated as BDCs under the Investment Company Act.

 

(r)Material Agreements. There are no contracts or other documents required by
the Securities Act or the Securities Act Rules and Regulations to be described
in or incorporated by reference into the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement which have
not been accurately described in all material respects in the Prospectus or
incorporated or filed as required. Each document incorporated by reference into
the Registration Statement or the Prospectus complied, as of the date filed, in
all material respects with the requirements of the Exchange Act and the Exchange
Act Regulations.

 

(s)Material Relationships. No relationship, direct or indirect, exists between
or among the Company on the one hand, and the directors, officers, security
holders of the Company, the Adviser, or their respective affiliates, on the
other hand, which is required to be described in the Prospectus and which is not
so described.

 

(t)Authorized Use of Trademarks. Any required consent and authorization has been
obtained for the use of any trademark or service mark in any advertising and
supplemental sales literature or other materials delivered by the Company to the
Dealer Manager or approved by the Company for use by the Dealer Manager and, to
the Company’s knowledge, its use does not constitute the unlicensed use of
intellectual property.

 

2.Representations and Warranties of the Dealer Manager. The Dealer Manager
represents, warrants and agrees to the following as of the date hereof and
during the term of this Agreement:

 

(a)Organization Status. The Dealer Manager is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Delaware, with all requisite power and authority to enter into this Agreement
and to carry out its obligations hereunder.

 

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(b)Authorization of Agreement. This Agreement has been duly authorized, executed
and delivered by the Dealer Manager, and assuming due authorization, execution
and delivery of this Agreement by the Company and the Adviser, will constitute a
valid and legally binding agreement of the Dealer Manager enforceable against
the Dealer Manager in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency or similar laws affecting the
enforcement of creditors’ rights generally or by equitable principles relating
to enforceability and except that rights to indemnity and contribution hereunder
may be limited by applicable law and public policy.

 

(c)Absence of Conflict Or Default. The execution and delivery of this Agreement,
the consummation of the transactions herein contemplated and compliance with the
terms of this Agreement by the Dealer Manager will not conflict with or
constitute a default under (i) its organizational documents, (ii) any indenture,
mortgage, deed of trust or lease to which the Dealer Manager is a party or by
which it may be bound, or to which any of the property or assets of the Dealer
Manager is subject, or (iii) any rule, regulation, writ, injunction or decree of
any government, governmental instrumentality or court, domestic or foreign,
having jurisdiction over the Dealer Manager or its assets, properties or
operations, except in the case of clause (ii) or (iii) for such conflicts or
defaults that would not individually or in the aggregate have or reasonably be
expected to have a material adverse effect on the condition (financial or
otherwise), business affairs, properties or results of operations of the Dealer
Manager.

 

(d)Broker-Dealer Registration; FINRA Membership. The Dealer Manager is, and
during the term of this Agreement will be, duly registered as a broker-dealer
pursuant to the provisions of the Exchange Act and the Exchange Act Rules and
Regulations, a member in good standing of FINRA, and a broker or dealer duly
registered as such in those states where the Dealer Manager is required to be
registered in order to carry out its responsibilities as contemplated by this
Agreement. Moreover, the Dealer Manager’s employees and representatives have all
required licenses and registrations to act under this Agreement. There is no
provision in the Dealer Manager’s FINRA membership agreement that would restrict
the ability of the Dealer Manager to carry out its responsibilities as
contemplated by this Agreement.

 

(e)Disclosure. The information under the caption “Plan of Distribution” in the
Prospectus insofar as it relates to the Dealer Manager, and all other
information furnished to the Company by the Dealer Manager in writing
specifically 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 in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading.

 

3.Offering and Sale of the Shares. The Company hereby appoints the Dealer
Manager as its agent and exclusive distributor to solicit and to retain the
Selected Dealers (as defined below in Section 3(a)) to solicit subscriptions for
the Shares at the subscription price to be paid in cash. The Dealer Manager
hereby accepts such agency and exclusive distributorship and agrees to use its
reasonable best efforts to sell or cause to be sold the Shares in such
quantities and to such Persons in accordance with the terms set forth in this
Agreement, the Prospectus and the Registration Statement. Unless this Agreement
is earlier terminated pursuant to Section 10, the Dealer Manager shall use such
reasonable best efforts during the Offering Period.

 

As used in this Agreement, “ Offering Period ” means the period commencing on
the initial Effective Date and ending on the earliest to occur of the following:
(1) the acceptance by the Company of subscriptions for 300,000,000 Shares; (2)
the termination of the Offering by the Company, which the Company shall have the
right to terminate in its sole and absolute discretion at any time, provided
that if the Company commences a public offering pursuant to the Registration
Statement or another registration statement filed pursuant to the Securities Act
within nine months from the date of the termination of the Offering, the Dealer
Manager’s exclusive retention pursuant to this Agreement (and the Offering
Period) shall be reinstated; (3) the termination or expiration of the
effectiveness of the Registration Statement, provided that if the Company
commences a public offering pursuant to the Registration Statement or another
registration statement filed pursuant to the Securities Act within nine months
from the date of the termination or expiration of the effectiveness of the
Registration Statement, the Dealer Manager’s exclusive retention pursuant to
this Agreement and the Offering Period shall be reinstated; and (4) the
liquidation or dissolution of the Company.

 

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The number of Shares, if any, to be reserved for sale by each Selected Dealer
may be determined, from time to time, by the Dealer Manager upon prior
consultation with the Company. In the absence of such determination, the Company
shall, subject to the provisions of Section 3(b), accept Subscription Agreements
(as defined below) based upon a first-come, first accepted reservation or other
similar method. Under no circumstances will the Dealer Manager be obligated to
underwrite or purchase any Shares for its own account and, in soliciting
purchases of Shares, the Dealer Manager shall act solely as the Company’s agent
and not as an underwriter or principal.

 

(a)Selected Dealers. The Shares offered and sold through the Dealer Manager
under this Agreement shall be offered and sold only by the Dealer Manager and
other securities dealers the Dealer Manager may retain (collectively, the
“Selected Dealers”); provided, however, that (i) the Dealer Manager reasonably
believes that each of the Selected Dealers is registered as a broker-dealer
pursuant to the provisions of the Exchange Act and the Exchange Act Rules and
Regulations, a member in good standing of FINRA and is duly licensed or
registered by the regulatory authorities in the jurisdictions in which they will
offer and sell Shares or exempt from broker-dealer registration with the
Commission and all other applicable regulatory authorities, (ii) all such
engagements are evidenced by written agreements, the terms and conditions of
which substantially conform to the form of Selected Dealer Agreement approved by
the Company and the Dealer Manager (the “Selected Dealer Agreement”), and (iii)
the Company shall have previously approved each Selected Dealer (such approval
not to be unreasonably withheld or delayed).

 

(b)Subscription Documents. Each Person desiring to purchase Shares through the
Dealer Manager, or any other Selected Dealer, will be required to complete and
execute the subscription agreement included as Appendix A in the Prospectus (the
“Subscription Agreement”).

 

i.Until the Minimum Offering has been sold, payments for Shares shall be made by
checks payable to “UMB BANK, N.A., ESCROW AGENT FOR BUSINESS DEVELOPMENT
CORPORATION OF AMERICA II” During such time, the Selected Dealer shall forward
original checks together with an original Subscription Agreement, executed and
initialed by the subscriber as provided for in the Subscription Agreement, to
the Escrow Agent at the address provided in the Subscription Agreement.

 

ii.Once the Minimum Offering has been deposited in the Escrow Account, upon
determination by the Company that it intends to break escrow, the Company shall
deposit (or cause to be deposited) all subscription funds to a designated
deposit account in the name of the Company (the “Deposit Account”) at a bank
which shall be subject to the reasonable prior approval of the Dealer Manager
and subject to any higher or continuing escrow obligations imposed by certain
states as described in the Prospectus. At this time, after the Minimum Offering
has been satisfied, payments for Shares shall be made to “ BUSINESS DEVELOPMENT
CORPORATION OF AMERICA II .”

 

(c)Deposit Account. Once subscription funds from Persons in the Escrow Account
aggregate $2,000,000 in respect of Shares of the Company (the “Escrow Break
Date”), subject to any continuing escrow obligations imposed by certain states
as described in the Prospectus, the Company will deposit all subsequent
subscription funds in the Deposit Account.

 

(d)Internal Review. When a Selected Dealer’s internal supervisory procedures are
conducted at the site at which the Subscription Agreement and check were
initially received by the Selected Dealer from the subscriber, the Selected
Dealer shall transmit the Subscription Agreement and check to the Escrow Agent
by the end of the next business day following receipt of the check and
Subscription Agreement. When, pursuant to the Selected Dealer’s internal
supervisory procedures, the Selected Dealer’s final internal supervisory
procedures are conducted at a different location (the “Final Review Office”),
the Selected Dealer shall transmit the check and Subscription Agreement to the
Final Review Office by the end of the next business day following the Selected
Dealer’s receipt of the Subscription Agreement and check. The Final Review
Office will, by the end of the next business day following its receipt of the
Subscription Agreement and check, forward both the Subscription Agreement and
check to the Escrow Agent. If any Subscription Agreement solicited by the
Selected Dealer is rejected by the Dealer Manager or the Company, then the
Subscription Agreement and check will be returned to the rejected subscriber
within 10 business days from the date of rejection.

 

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(e)Completed Sale. A sale of a Share shall be deemed by the Company to be
completed if and only if (i) the Company has received a properly completed and
executed Subscription Agreement, together with payment of the full purchase
price of each purchased Share, from an investor who satisfies the applicable
suitability standards and minimum purchase requirements set forth in the
Registration Statement as determined by the Selected Dealer, or the Dealer
Manager, as applicable, in accordance with the provisions of this Agreement,
(ii) the Company has accepted such subscription, and (iii) such investor has
been admitted as a stockholder of the Company. In addition, no sale of Shares
shall be completed until at least five business days after the date on which the
subscriber receives a copy of the Prospectus. The Dealer Manager hereby
acknowledges and agrees that the Company, in its sole and absolute discretion,
may accept or reject any subscription, in whole or in part, for any reason
whatsoever or no reason, and no commission or dealer manager fee will be paid to
the Dealer Manager with respect to that portion of any subscription which is
rejected.

 

(f)Dealer Manager Compensation.

 

i.Subject to the volume discounts and other special circumstances described in
or otherwise provided in the “Plan of Distribution” section of the Prospectus or
this Section 3(f), the Company agrees to pay the Dealer Manager selling
commissions in the amount of 7% of the gross proceeds of shares sold in the
Offering. Alternatively, if the Selected Dealer elects to receive selling
commissions equal to 7.5% of the gross proceeds of shares sold in the Offering
in accordance with the Selected Dealer Agreement, the Company agrees to pay the
Dealer Manager selling commissions in the amount of 7.5% of the gross proceeds
of shares sold in the Offering, of which 2.5% shall be payable at the time of
such sale and 1% shall be paid on each anniversary of the closing of such sale
up to and including the fifth anniversary of the closing of such sale. The
Company will pay reduced selling commissions or may eliminate commissions on
certain sales of Shares, in accordance with, and on the terms set forth in, the
Prospectus. The Dealer Manager will reallow all the selling commissions, subject
to federal and state securities laws, to the Selected Dealer who sold the
Shares, as described more fully in the Selected Dealer Agreement. In no event
shall the Dealer Manager be entitled to payment of any compensation in the event
that the Minimum Offering is not completed according to this Agreement;
provided, however, that the reimbursement of out-of-pocket accountable expenses
actually incurred by the Dealer Manager or persons associated with the Dealer
Manager shall not be presumed to be unfair or unreasonable and shall be payable
under normal circumstances.

 

ii.Subject to the special circumstances described in or otherwise provided in
the “Plan of Distribution” section of the Prospectus or this Section 3(f), as
compensation for acting as the dealer manager, the Company will pay the Dealer
Manager a dealer manager fee in the amount of 3% of the gross proceeds of shares
sold in the Offering (the “Dealer Manager Fee”). Notwithstanding the foregoing,
the Dealer Manager Fee will be reduced to two and one-half percent (2.5%) if the
Selling Commission is seven and one-half percent (7.5%) as described above. The
Dealer Manager may retain or re-allow up to fifty percent (50%) of the Dealer
Manager Fee, subject to federal and state securities laws, to the Selected
Dealer who sold the Shares, as described more fully in the Selected Dealer
Agreement.

 

9

 

 

iii.All selling commissions and Dealer Manager Fees payable to the Dealer
Manager with respect to an investor subscribing for the Shares will be paid as
dictated by industry practice after the investor is admitted as a stockholder of
the Company.

 

iv.In no event shall the total aggregate underwriting compensation payable from
whatever source to the Dealer Manager and any Selected Dealers participating in
the Offering, including, but not limited to, selling commissions and the Dealer
Manager Fee, exceed 10% of gross offering proceeds from the Offering in the
aggregate.

 

In connection with the minimum amount offered by the Company pursuant to the
Prospectus and FINRA’s 10% underwriting compensation limitation under FINRA Rule
2310 (“FINRA’s 10% cap”), the Dealer Manager shall advance all of the fixed
expenses related to the sale of Shares, including, but not limited to,
wholesaling salaries, salaries of dual employees allocated to wholesaling
activities, and other fixed expenses (including, but not limited to, wholesaling
expense reimbursements and the Dealer Manager’s legal expenses associated with
filing the Offering with FINRA), that are required to be included within FINRA’s
10% cap to ensure that the aggregate underwriting compensation paid in
connection with the Offering does not exceed FINRA’s 10% cap.

 

The Dealer Manager shall repay to the Company any excess amounts received over
FINRA’s 10% cap if the Offering is abruptly terminated after receiving the
minimum amount offered by the Company pursuant to the Prospectus and before
reaching the maximum amount offered by the Company pursuant to the Prospectus.

 

No compensation in connection with the Offering may be paid to the Dealer
Manager, Soliciting Dealers or their affiliates out of the proceeds of the
Offering prior to the release of such proceeds from escrow.

 

v.Notwithstanding anything to the contrary contained herein, if the Company pays
any selling commission to the Dealer Manager for sale by a Selected Dealer of
one or more Shares and the subscription is rescinded as to one or more of the
Shares covered by such Subscription Agreement, then the Company shall decrease
the next payment of selling 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 this Section 3(f), multiplied by the number
of Shares as to which the subscription was rescinded. If no payment of selling
commissions or other compensation is due to the Dealer Manager after such
withdrawal occurs, then the Dealer Manager shall pay the amount specified in the
preceding sentence to the Company within a reasonable period of time not to
exceed 30 days following receipt of notice by the Dealer Manager from the
Company stating the amount owed as a result of rescinded subscriptions.

 

(g)Reasonable Bona Fide Due Diligence Expenses. The Company or the Adviser shall
reimburse the Dealer Manager or any Selected Dealer for reasonable bona fide due
diligence expenses incurred by the Dealer Manager or any Selected Dealer. The
Company shall only reimburse the Dealer Manager or any Selected Dealer for such
approved bona fide due diligence expenses to the extent such expenses have
actually been incurred and are supported by detailed and itemized invoice(s)
provided to the Company and permitted pursuant to the rules and regulations of
FINRA .

 

(h)Certain Advances to Dealer Manager. The parties hereto acknowledge that prior
to the initial Effective Date, the Company may have paid to the Dealer Manager
advances of monies against out-of-pocket accountable expenses actually
anticipated to be incurred by the Dealer Manager in connection with the Offering
(other than reasonable bona fide due diligence expenses). Such advances shall be
credited against such portion of the Dealer Manager Fees payable pursuant to
Section 3(f) that is retained by the Dealer Manager and not reallowed until the
full amount of such advances is offset. Such advances are not intended to be in
addition to the compensation set forth in Section 3(f) and any and all monies
advanced that are not utilized for out-of-pocket accountable expenses actually
incurred by the Dealer Manager in connection with the Offering (other than
reasonable bona fide due diligence expenses) shall be reimbursed by the Dealer
Manager to the Company.

 

10

 

 

(i)Selected Dealers. The Company will not be liable or responsible to any
Selected Dealer for direct payment of selling commissions or the Dealer Manager
Fee to such Selected Dealer, it being the sole and exclusive responsibility of
the Dealer Manager for payment of selling commissions or the Dealer Manager Fee
to Selected Dealers.

 

4.Conditions to the Dealer Manager’s Obligations. The Dealer Manager’s
obligations hereunder shall be subject to the following terms and conditions
(and if all such conditions are not satisfied or waived by the Dealer Manager on
or before the initial Effective Date or at any time thereafter until the
Termination Date (as defined in Section 10(a)), then no funds shall be released
(1) from the Escrow Account if the Dealer Manager provides notice to this effect
to the Company and the Escrow Agent, and (2) from the Deposit Account if the
Dealer Manager provides notice to this effect to the Company and the Escrow
Agent:

 

(a)The representations and warranties on the part of the Company and the Adviser
contained in this Agreement hereof shall be true and correct in all material
respects and the Company and the Adviser shall have complied with their
covenants, agreements and obligations contained in this Agreement in all
material respects;

 

(b)The Registration Statement shall have become effective and no stop order
suspending the effectiveness of the Registration Statement shall have been
issued by the Commission and, to the best knowledge of the Company and the
Adviser, no proceedings for that purpose shall have been instituted, threatened
or contemplated by the Commission; and any request by the Commission for
additional information (to be included in the Registration Statement or
Prospectus or otherwise) shall have been complied with to the reasonable
satisfaction of the Dealer Manager.

 

(c)The Registration Statement and the Prospectus, and any amendment or any
supplement thereto, shall not contain any untrue statement of material fact, or
omit to state a material fact that is required to be stated therein or is
necessary to make the statements therein not misleading.

 

(d)On the initial Effective Date and at or prior to the fifth business day
following the Effective Date of each post-effective amendment to the
Registration Statement that includes or incorporates by reference new audited
financial statements for the Company, the Dealer Manager reserves the right to
receive from Grant Thornton LLP or such other independent registered public
accountants for the Company, (i) a letter, dated the applicable date, addressed
to the Dealer Manager, in form and substance satisfactory to the Dealer Manager,
containing statements and information of the type ordinarily included in
accountant’s “comfort letters” to placement agents or dealer managers, delivered
according to Statement of Auditing Standards No. 72 (or any successor bulletin),
with respect to the audited financial statements and certain financial
information contained in the Registration Statement and the Prospectus, and (ii)
confirming that they are (A) independent registered public accountants as
required by the Securities Act, and (B) in compliance with the applicable
requirements relating to the qualification of accountants under Rule 2-01 of
Regulation S-X.

 

(e)At or prior to the fifth business day following (i) the request by the Dealer
Manager in connection with any third-party due diligence investigation, and (ii)
the Effective Date of each post-effective amendment to the Registration
Statement (other than post-effective amendments filed solely pursuant to Rule
462(d) under the Securities Act and other than the post-effective amendments
referred to in Section 4(d)), the Dealer Manager shall have received from Grant
Thornton LLP or such other independent public or certified public accountants
for the Company, if applicable, a letter, dated such date, in form and substance
satisfactory to the Dealer Manager, to the effect that they reaffirm the
statements made in the most recent letter furnished pursuant to Section 4(d),
except that the specified date referred to therein for the carrying out of
procedures shall be no more than three business days prior to the date of the
letter furnished pursuant to this Section 4(e).

 

11

 

 

(f)At or prior to the Effective Date and at or prior to the fifth business day
following the effective date of each post-effective amendment to the
Registration Statement (other than post-effective amendments filed solely
pursuant to Rule 462(d) under the Securities Act), the Dealer Manager shall have
received a written certificate executed by the Chief Executive Officer or
President of the Company and the Chief Financial Officer of the Company, dated
as of the applicable date, to the effect that: (i) the representations and
warranties of the Company and the Adviser set forth in this Agreement are true
and correct in all material respects with the same force and effect as though
expressly made on and as of the applicable date; and (ii) the Company and the
Adviser have complied in all material respects with all the agreements hereunder
and satisfied all the conditions on their part to be performed or satisfied
hereunder at or prior to the applicable date.

 

5.Covenants of the Company and the Adviser. The Company and the Adviser hereby
covenant and agree with the Dealer Manager as follows:

 

(a)Registration Statement. The Company will use commercially reasonable efforts
(i) to cause the Registration Statement and any subsequent amendments thereto to
become effective as promptly as possible; and (ii) on an ongoing basis, to
maintain an effective status with the Commission of the Registration Statement,
as amended, thereafter until the termination of the Offering. The Company will
furnish a copy of any amendment or supplement of the Registration Statement or
the Prospectus to the Dealer Manager. The Company will comply in all material
respects with all federal and state securities laws, rules and regulations which
are required to be complied with in order to permit the continuance of offers
and sales of the Shares in accordance with the provisions hereof and of the
Prospectus.

 

(b)Business Development Company Status. The Company will use its best efforts to
maintain its status as a BDC; provided, however, the Company may change the
nature of its business so as to cease to be, or to withdraw its election as, a
BDC, with the approval of the Company’s board of directors and a vote of its
stockholders as required by Section 58 of the Investment Company Act.

 

(c)Investment Adviser. Upon the initial Effective Date, the Adviser will be
registered as an investment adviser under the Advisers Act and will not be
prohibited by the Advisers Act or the Investment Company Act from acting under
the Advisory Agreement for the Company as contemplated by the Prospectus. There
does not exist any proceeding or, to the Advisers knowledge, any facts or
circumstances the existence of which could lead to any proceeding which might
adversely affect the registration of the Adviser with the Commission.

 

(d)Subchapter M. The Company will use its best efforts to qualify for and elect
to be treated as a regulated investment company under Subchapter M of the
Internal Revenue Code of 1986, as amended, and to maintain such qualification
and election in effect for each full fiscal year during which it is a BDC under
the Investment Company Act; provided that, at the discretion of the Company’s
board of directors, it may elect not to be so treated.

 

(e)Commission Orders. If the Commission shall issue any stop order or any other
order preventing or suspending the use of the Prospectus, or shall institute any
proceedings for that purpose, then the Company will promptly notify the Dealer
Manager and use its commercially reasonable efforts to prevent the issuance of
any such order and, if any such order is issued, to use commercially reasonable
efforts to obtain the removal thereof as promptly as possible.

 

(f)Blue Sky Qualifications. The Company will use commercially reasonable efforts
to qualify the Shares for offering and sale under the securities or blue sky
laws of such jurisdictions as the Dealer Manager and the Company shall mutually
agree upon and to make such applications, file such documents and furnish such
information as may be reasonably required for that purpose. The Company will
furnish the Dealer Manager with a copy of such papers filed by the Company in
connection with any such qualification. The Company will promptly advise the
Dealer Manager of the issuance by such securities administrators of any stop
order preventing or suspending the use of the Prospectus or of the initiation of
any proceedings for that purpose, and will use its commercially reasonable
efforts to prevent the issuance of any such order and if any such order is
issued, to use its commercially reasonable efforts to obtain the removal thereof
as promptly as possible. The Company will notify the Dealer Manager promptly
following each date of (i) the effectiveness of qualification or exemption of
the Shares in any jurisdiction in which the offering and sale of Shares has been
authorized by appropriate state regulatory authorities; and (ii) a change in the
status of the qualification or exemption of the Shares in any jurisdiction in
any respect.

 

12

 

 

(g)Amendments and Supplements. If, at any time when a Prospectus relating to the
Shares is required to be delivered under the Securities Act, any event shall
have occurred to the knowledge of the Company, or the Company receives notice
from the Dealer Manager that it believes such an event has occurred, as a result
of which the Prospectus or any Approved Sales Literature (as defined in Section
5(k) below) as then amended or supplemented would include any untrue statement
of a material fact, or omit to state a material fact necessary to make the
statements therein not misleading in light of the circumstances existing at the
time, so that it is then required to be delivered to a subscriber an amendment
or supplement which will correct such statement, or if it is necessary at any
time to amend the Registration Statement or supplement the Prospectus relating
to the Shares to comply with the Securities Act, then the Company will promptly
notify the Dealer Manager thereof (unless the information shall have been
received from the Dealer Manager) and will prepare and file with the Commission
such an amendment or supplement, and shall make available to the Dealer Manager
thereof sufficient copies for its own use and distribution to the Selected
Dealers.

 

(h)Requests from Commission or State Securities Administrators. The Company will
promptly advise the Dealer Manager of any request made by the Commission or a
state securities administrator for amending the Registration Statement,
supplementing the Prospectus or for additional information.

 

(i)Copies of Registration Statement. The Company will furnish the Dealer Manager
with one signed copy of the Registration Statement, including its exhibits, and
such additional copies of the Registration Statement, without exhibits, and the
Prospectus and all amendments and supplements thereto, which are finally
approved by the Commission, as the Dealer Manager may reasonably request for
sale of the Shares.

 

(j)Qualification To Transact Business; Authority to Perform Agreements. The
Company will take all steps necessary to ensure that at all times the Company
will validly exist as a Maryland corporation and will be qualified to do
business in all jurisdictions in which the conduct of its business requires such
qualification and where such qualification is required under local law. The
Company undertakes to obtain all consents, approvals, authorizations or orders
of any court or governmental agency or body which are required for the Company’s
performance of this Agreement and under the Company’s articles of incorporation
(as the same may be amended, supplemented or otherwise modified from
time-to-time, the “Company’s Charter”) and bylaws for the consummation of the
transactions contemplated hereby and thereby, respectively, or the conducting by
the Company of the business described in the Prospectus.

 

(k)Sales Literature. The Company will furnish to the Dealer Manager as promptly
as shall be practicable upon request any supplemental sales literature or
advertisement (including, without limitation any “broker-dealer use only”
material), regardless of how labeled or described, for use in addition to the
Prospectus in connection with the Offering which previously has been, or
hereafter is, furnished or approved by the Company (collectively, “ Approved
Sales Literature ”) (provided that the use of said material has been first
approved for use by all appropriate regulatory agencies). Any Approved Sales
Literature shall, to the extent required, be filed with and, to the extent
required, approved by the appropriate securities agencies and bodies, provided
that the Dealer Manager will make all FINRA filings, to the extent required. The
Company will prepare (or cause to be prepared) all Approved Sales Literature.
Each of the Company and the Adviser will not (and will cause its affiliates to
not) (i) show or give to any investor or prospective investor or any material or
writing that is marked “broker-dealer use 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; and (ii) show or give to any investor or prospective
investor in a particular jurisdiction any material or writing if such material
bears a legend denoting that it is not to be used in connection with the sale of
Shares to members of the public in such jurisdiction.

 

13

 

 

(l)Use of Proceeds. The Company will apply the proceeds from the sale of the
Shares as set forth in the Prospectus.

 

(m)Customer Information. Each of the Company and the Adviser shall:

 

i.abide by and comply with (A) the privacy standards and requirements of the
Gramm-Leach-Bliley Act of 1999 (the “GLB Act”), (B) the privacy standards and
requirements of any other applicable federal or state law, and (C) its own
internal privacy policies and procedures, each as may be amended from time to
time;

 

ii.refrain from the use or disclosure of nonpublic personal information (as
defined under the GLB Act) of all customers who have opted out of such
disclosures except as necessary to service the customers or as otherwise
necessary or required by applicable law; and

 

iii.determine which customers have opted out of the disclosure of nonpublic
personal information by periodically reviewing and, if necessary, retrieving an
aggregated list of such customers from the Selected Dealers (the “List”) to
identify customers that have exercised their opt-out rights. If either party
uses or discloses nonpublic personal information of any customer for purposes
other than servicing the customer, or as otherwise required by applicable law,
that party will consult the List to determine whether the affected customer has
exercised his or her opt-out rights. Each party understands that it is
prohibited from using or disclosing any nonpublic personal information of any
customer that is identified on the List as having opted out of such disclosures.

 

(n)Certain Payments. Without the prior consent of the Dealer Manager, none of
the Company, the Adviser or any of their respective affiliates will make any
payment (cash or non-cash) to any associated Person or registered representative
of the Dealer Manager.

 

(o)Dealer Manager’s Review of Proposed Amendments and Supplements. Prior to
amending or supplementing the Registration Statement, any preliminary prospectus
or the Prospectus (including any amendment or supplement through incorporation
of any report filed under the Exchange Act), the Company shall furnish to the
Dealer Manager for review, a reasonable amount of time prior to the proposed
time of filing or use thereof, a copy of each such proposed amendment or
supplement, and the Company shall not file or use any such proposed amendment or
supplement without the Dealer Manager’s consent, which consent shall not be
unreasonably withheld, conditioned or delayed.

 

6.Covenants of the Dealer Manager. The Dealer Manager hereby covenants and
agrees with the Company and the Adviser to the following:

 

(a)Compliance with Laws; Prospectus Delivery. With respect to the Dealer
Manager’s participation and the participation by each Selected Dealer in the
offer and sale of the Shares (including, without limitation, any resales and
transfers of Shares), the Dealer Manager agrees, and each Selected Dealer in its
Selected Dealer Agreement will agree, to comply in all material with all
applicable requirements of (i) the Securities Act, the Securities Act Rules and
Regulations, the Exchange Act, the Exchange Act Rules and Regulations and all
other federal regulations applicable to the Offering, (ii) all applicable state
securities or blue sky laws and regulations in effect from time to time, and
(iii) the Rules of FINRA applicable to the Offering, from time to time in
effect, specifically including, but not in any way limited to, NASD Conduct
Rules 2340 and 2420 and FINRA Rules 2310, 5130 and 5141 therein. The Dealer
Manager will not offer the Shares for sale 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.

 

14

 

 

In addition, the Dealer Manager shall, in accordance with applicable law or as
prescribed by any state securities administrator, provide, or require in the
Selected Dealer Agreement that the Selected Dealer shall provide, to any
prospective investor copies of the Prospectus and any supplements thereto during
the course of the Offering and prior to the sale. The Company may provide the
Dealer Manager with certain Approved Sales Literature to be used by the Dealer
Manager and the Selected Dealers in connection with the solicitation of
purchasers of the Shares. The Dealer Manager agrees not to deliver the Approved
Sales Literature to any Person prior to the initial Effective Date. If the
Dealer Manager elects to use such Approved Sales Literature after the initial
Effective Date, then the Dealer Manager agrees that such material shall not be
used by it in connection with the solicitation of purchasers of the Shares and
that it will direct Selected Dealers not to make such use 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 Approved Sales Literature other than those provided to the Dealer
Manager by the Company for use in the Offering.

 

(b)No Additional Information. In offering the Shares for sale, the Dealer
Manager shall not, and each Selected Dealer shall agree not to, give or provide
any information or make any representation other than those contained in the
Prospectus or the Approved Sales Literature. The Dealer Manager will not (i)
show or give to any investor or prospective investor any material or writing
that is supplied to it by the Company and marked “broker-dealer use 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; and (ii) show or give to any
investor or prospective investor in a particular jurisdiction any material or
writing that is supplied to it by the Company if such material bears a legend
denoting that it is not to be used in connection with the sale of Shares to
members of the public in such jurisdiction.

 

(c)Sales of Shares. The Dealer Manager shall, and each Selected Dealer shall
agree to, solicit purchases of the Shares only in the jurisdictions in which the
Dealer Manager and such Selected Dealer are legally qualified to so act and in
which the Dealer Manager and each Selected Dealer have been advised by the
Company in writing that such solicitations can be made.

 

(d)Subscription Agreement. The Dealer Manager will comply in all material
respects with the subscription procedures set forth in the “Plan of
Distribution” section of the Prospectus. Subscriptions will be submitted by the
Dealer Manager and each Selected Dealer to the Company only on the form which is
included as Appendix A to the Prospectus. The Dealer Manager understands and
acknowledges, and the Selected Dealers each acknowledge, that the Subscription
Agreement must be executed and initialed by the subscriber as provided for by
the Subscription Agreement.

 

15

 

 

(e)Suitability. The Dealer Manager will offer Shares, and in its agreement with
each Selected Dealer will require that the Selected Dealer offer Shares, only to
Persons that it has reasonable grounds to believe meet the financial
qualifications set forth in the Prospectus and will only make offers to Persons
in the states in which it is advised in writing by the Company 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 the Selected
Dealers will require that the Selected Dealers comply, with the provisions of
all applicable rules and regulations relating to suitability of investors,
including without limitation FINRA Rules 2111 and 2310 and the provisions of
Sections III.C. and III.E. of the Omnibus Guidelines of the North American
Securities Administrators Association, Inc. (the “NASAA Guidelines”). The Dealer
Manager agrees that in recommending the purchase of the Shares to an investor,
the Dealer Manager and each Person associated with the Dealer Manager that makes
such recommendation shall have, and each Selected Dealer in its Selected Dealer
Agreement shall agree with respect to investors to which it makes a
recommendation shall agree that it shall have, reasonable grounds to believe, on
the basis of information obtained from the investor concerning the investor’s
investment objectives, other investments, financial situation and needs, and any
other information known by the Dealer Manager, the Person associated with the
Dealer Manager or the Selected Dealer that: (i) the investor is or will be in a
financial position appropriate to enable the investor to realize to a
significant extent the benefits described in the Prospectus, including the tax
benefits where they are a significant aspect of the Company; (ii) the investor
has a fair market net worth sufficient to sustain the risks inherent in the
program, including loss of investment and lack of liquidity; and (iii) an
investment in the Shares offered in the Offering is otherwise suitable for the
investor. The Dealer Manager agrees as to investors to whom it makes a
recommendation with respect to the purchase of the Shares in the Offering (and
each Selected Dealer in its Selected Dealer Agreement shall agree, with respect
to Investors to whom it makes such recommendations) to maintain in the files of
the Dealer Manager (or the Selected Dealer, as applicable) documents disclosing
the basis upon which the determination of suitability was reached as to each
investor. In making the determinations as to financial qualifications and as to
suitability required by the NASAA Guidelines, the Dealer Manager and Selected
Dealers may rely on (A) representations from investment advisers who are not
affiliated with a Selected Dealer, banks acting as trustees or fiduciaries, and
(B) information it has obtained from a prospective investor, including such
information as the investment objectives, other investments, financial situation
and needs of the Person or any other information known by the Dealer Manager (or
Selected Dealer, as applicable), after due inquiry. Notwithstanding the
foregoing, the Dealer Manager shall not, and each Selected Dealer shall agree
not to, execute any transaction in the Company in a discretionary account
without prior written approval of the transaction by the customer.

 

(f)Recordkeeping. The Dealer Manager shall, and each Selected Dealer shall agree
to, maintain, for at least six years or for a period of time not less than that
required in order to comply with all applicable federal, state and other
regulatory requirements, whichever is later, a record of the information
obtained to determine that an investor meets the suitability standards imposed
on the offer and sale of the Shares (both at the time of the initial
subscription and at the time of any additional subscriptions) and a
representation of the investor that the investor is investing for the investor’s
own account or, in lieu of such representation, information indicating that the
investor for whose account the investment was made met the suitability
standards. The Company agrees that the Dealer Manager can satisfy its obligation
by contractually requiring such information to be maintained by the investment
advisers or banks referred to in Section 6(e).

 

(g)Selected Dealer Agreements. All engagements of the Selected Dealers will be
evidenced by a Selected Dealer Agreement.

 

(h)Electronic Delivery. If it intends to use electronic delivery to distribute
the Prospectus to any Person, it will comply with all applicable requirements of
the Commission, the Blue Sky laws, FINRA and any other laws or regulations
related to the electronic delivery of documents.

 

(i)Coordination. The Company, the Adviser and the Dealer Manager shall have the
right, but not the obligation, to meet with key personnel of the other on an
ongoing and regular basis to discuss the Offering.

 

(j)AML Compliance. The Dealer Manager represents to the Company that it has
established and implemented anti-money laundering compliance programs (“AML
Program”) in accordance with applicable law, including applicable FINRA Conduct
Rules, Exchange Act Rules and Regulations and the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act (USA PATRIOT Act) of 2001, as amended (the “USA PATRIOT Act”),
specifically including, but not limited to, Section 352 of the International
Money Laundering Abatement and Anti-Terrorist Financing Act of 2001 (the “Money
Laundering Abatement Act,” and together with the USA PATRIOT Act, the “AML
Rules”), reasonably expected to detect and cause the reporting of suspicious
transactions in connection with the offering and sale of the Shares. The Dealer
Manager further represents that it is currently in compliance with all AML
Rules, specifically including, but not limited to, the Customer Identification
Program requirements under Section 326 of the Money Laundering Abatement Act,
and the Dealer Manager hereby covenants to remain in compliance with such
requirements and shall, upon request by the Company, provide a certification to
the Company that, as of the date of such certification (i) its AML Program is
consistent with the AML Rules, and (ii) it is currently in compliance with all
AML Rules, specifically including, but not limited to, the Customer
Identification Program requirements under Section 326 of the Money Laundering
Abatement Act.

 

16

 

 

(k)Cooperation. Upon the expiration or earlier termination of this Agreement
prior to the expiration or termination of the Offering, the Dealer Manager will
use reasonable efforts to cooperate with the Company and any other party that
may be necessary to accomplish an orderly transfer and transfer to a successor
dealer manager of the operation and management of the services the Dealer
Manager is providing to the Company under this Agreement; provided that the
Company shall not be in breach or default of this Agreement. The Dealer Manager
will not be entitled to receive any additional fee in connection with the
foregoing provisions of this Section 6(k), but the Company will pay or reimburse
the Dealer Manager for any out-of-pocket expenses reasonably incurred by the
Dealer Manager in connection therewith.

 

(l)Customer Information. The Dealer Manager shall, and in its agreements with
Selected Dealers shall require Selected Dealers to, agree to:

 

i.abide by and comply with (A) the privacy standards and requirements of the GLB
Act, (B) the privacy standards and requirements of any other applicable federal
or state law, and (C) its own internal privacy policies and procedures, each as
may be amended from time to time;

 

ii.refrain from the use or disclosure of nonpublic personal information (as
defined under the GLB Act) of all customers who have opted out of such
disclosures except as necessary to service the customers or as otherwise
necessary or required by applicable law; and

 

iii.determine which customers have opted out of the disclosure of nonpublic
personal information by periodically reviewing and, if necessary, retrieving the
List to identify customers that have exercised their opt-out rights. If either
party uses or discloses nonpublic personal information of any customer for
purposes other than servicing the customer, or as otherwise required by
applicable law, that party will consult the List to determine whether the
affected customer has exercised his or her opt-out rights. Each party
understands that it is prohibited from using or disclosing any nonpublic
personal information of any customer that is identified on the List as having
opted out of such disclosures.

 

7.Expenses. Subject to Sections 3(f), (g) and (h), the Dealer Manager shall pay
all its own costs and expenses incident to the performance of its obligations
under this Agreement. The Company agrees to pay all costs and expenses related
to:

 

(a)the registration of the offer and sale of the Shares with the Commission;

 

(b)expenses of printing the Registration Statement and the Prospectus and any
amendment or supplement thereto as herein provided;

 

(c)fees and expenses incurred in connection with any required filing with FINRA;

 

17

 

 

(d)all the expenses of agents of the Company, excluding the Dealer Manager,
incurred in connection with performing marketing and advertising services for
the Company including all costs and expenses incident to the travel and
accommodation of the Company’s employees in making road show presentations with
respect to the Offering;

 

(e)expenses of qualifying the Shares for offering and sale under state
securities laws, and expenses in connection with the preparation and printing of
the Blue Sky Survey;

 

(f)all fees and expenses of the Company’s legal counsel and the independent
registered public accounting firm;

 

(g)the fees and expenses of any transfer agent or registrar for the Shares and
miscellaneous expenses referred to in the Registration Statement; and

 

(h)the performance of the Company’s other obligations hereunder.

 

8.Indemnification.

 

(a)Indemnified Parties Defined. For the purposes of this Agreement, an
“Indemnified Party” shall mean a Person entitled to indemnification under this
Section 8, as well as such Person’s officers, directors (including with respect
to the Company, any Person named in the Registration Statement with his consent
as a director nominee), employees, members, partners, affiliates, agents and
representatives, and each Person, if any, who controls such Person within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act.

 

(b)Indemnification of the Dealer Manager and Selected Dealers. The Company will
indemnify, defend and hold harmless the Dealer Manager and the Selected Dealers,
and their respective Indemnified Parties, from and against any losses, claims,
expenses (including reasonable legal and other expenses incurred in
investigating and defending such claims or liabilities), damages or liabilities,
joint or several, to which any such Selected Dealers or the Dealer Manager, or
their respective Indemnified Parties, may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such losses, claims, expenses,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon: (i) in whole or in part, any material inaccuracy in a representation or
warranty contained herein by the Company or the Adviser, any material breach of
a covenant contained herein by the Company or the Adviser, or any material
failure by the Company or the Adviser to perform, its obligations hereunder or
to comply with state or federal securities laws applicable to the Offering; (ii)
any untrue statement or alleged untrue statement of a material fact contained
(A) in any Registration Statement or any post-effective amendment thereto or in
the Prospectus or any amendment or supplement to the Prospectus, (B) in any
Approved Sales Literature or (C) 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 (iii) the omission or alleged
omission to state a material fact required to be stated in the Registration
Statement or any post-effective amendment thereof to make the statements therein
not misleading or the omission or alleged omission to state a material fact
required to be stated in the Prospectus or any amendment or supplement to the
prospectus to make the statements therein, in light of the circumstances under
which they were made, not misleading, and the Company will reimburse each
Selected Dealer or the Dealer Manager, and their respective Indemnified Parties,
for any reasonable legal or other expenses incurred by such Selected Dealer or
the Dealer Manager, and their respective Indemnified Parties, in connection with
investigating or defending such loss, claim, expense, damage, liability or
action; provided, however, that the Company will not be liable in any such case
to the extent that any such loss, claim, expense, 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 by the Dealer Manager expressly for use in
the Registration Statement or any post-effective amendment thereof or the
Prospectus or any such amendment thereof or supplement thereto. The indemnity
provisions under this Section 8(b) will be in addition to any liability which
the Company may otherwise have.

 

18

 

 

Notwithstanding the foregoing, as required by the Company’s charter and Section
II.G. of the NASAA Guidelines, the indemnification and agreement to hold
harmless provided in this Section 8(b) is further limited to the extent that no
such indemnification by the Company of a Selected Dealer or the Dealer Manager,
or their respective Indemnified Parties, shall be permitted under this Agreement
for, or arising out of, an alleged violation of federal or state securities
laws, unless one or more of the following conditions are met: (i) there has been
a successful adjudication on the merits of each count involving alleged
securities law violations as to the particular Indemnified Party; (ii) such
claims have been dismissed with prejudice on the merits by a court of competent
jurisdiction as to the particular Indemnified Party; or (iii) a court of
competent jurisdiction approves a settlement of the claims against the
particular Indemnified Party and finds that indemnification of the settlement
and the related costs should be made, and the court considering the request for
indemnification has been advised of the position of the Commission and of the
published position of any state securities regulatory authority in which the
securities were offered or sold as to indemnification for violations of
securities laws.

 

(c)Dealer Manager Indemnification of the Company and Adviser. The Dealer Manager
will indemnify, defend and hold harmless the Company, the Adviser, each of their
Indemnified Parties and each Person who has signed the Registration Statement,
from and against any losses, claims, expenses (including the reasonable legal
and other expenses incurred in investigating and defending any such claims or
liabilities), damages or liabilities to which any of the aforesaid parties may
become subject under the Securities Act, the Exchange Act or otherwise, insofar
as such losses, claims, expenses, damages (or actions in respect thereof) arise
out of or are based upon: (i) in whole or in part, any material inaccuracy in a
representation or warranty contained herein by the Dealer Manager or any
material breach of a covenant contained herein by the Dealer Manager; (ii) any
untrue statement or any alleged untrue statement of a material fact contained
(A) in any Registration Statement or any post-effective amendment thereto or in
the Prospectus or any amendment or supplement to the Prospectus, (B) in any
Approved Sales Literature, or (C) in any Blue Sky Application; (iii) the
omission or alleged omission to state a material fact required to be stated in
the Registration Statement or any post-effective amendment thereof to make the
statements therein not misleading, or the omission or alleged omission to state
a material fact required to be stated in the Prospectus or any amendment or
supplement to the Prospectus to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, however,
that in each case described in clauses (ii) and (iii) 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 the Dealer
Manager expressly for use in the Registration Statement or any such
post-effective amendments thereof or the Prospectus or any such amendment
thereof or supplement thereto; or (iv) any use of sales literature, including
“broker-dealer use only” materials, by the Dealer Manager that is not Approved
Sales Literature. The Dealer Manager will reimburse the aforesaid parties for
any reasonable legal or other expenses incurred in connection with investigation
or defense of such loss, claim, expense, damage, liability or action. The
indemnity provisions under this Section 8(c) will be in addition to any
liability which the Dealer Manager may otherwise have.

 

(d)Selected Dealer Indemnification of the Company. By virtue of entering into
the Selected Dealer Agreement, each Selected Dealer severally will agree to
indemnify, defend and hold harmless the Company, the Dealer Manager, each of
their respective Indemnified Parties, and each Person who signed the
Registration Statement, from and against any losses, claims, expenses, damages
or liabilities to which the Company, the Dealer Manager, or any of their
respective Indemnified Parties, or any Person who signed the Registration
Statement, may become subject, under the Securities Act or otherwise, as more
fully described in the Selected Dealer Agreement.

 

19

 

 

(e)Action Against Parties; Notification. Promptly after receipt by any
Indemnified Party under this Section 8 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 8, promptly notify the
indemnifying party of the commencement thereof; provided, however, that the
failure to give such notice shall not relieve the indemnifying party of its
obligations hereunder except to the extent it shall have been actually
prejudiced by such failure. 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 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, and
unconditional release of all liabilities from, 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, such consent not to be
unreasonably withheld or delayed.

 

(f)Reimbursement of Fees And Expenses. An Indemnifying Party under this Section
8 shall be obligated to reimburse an Indemnified Party for reasonable legal and
other expenses as follows:

 

i.In the case of the Company indemnifying the Dealer Manager, the advancement of
Company funds to the Dealer Manager for legal expenses and other costs incurred
as a result of any legal action for which indemnification is being sought shall
be permissible (in accordance with Section II.G. of the NASAA Guidelines) only
if all of the following conditions are satisfied: (A) the legal action relates
to acts or omissions with respect to the performance of duties or services on
behalf of the Company; (B) the legal action is initiated by a third party who is
not a stockholder of the Company or the legal action is initiated by a
stockholder of the Company acting in his or her capacity as such and a court of
competent jurisdiction specifically approves such advancement; and (C) the
Dealer Manager undertakes to repay the advanced funds to the Company, together
with the applicable legal rate of interest thereon, in cases in which the Dealer
Manager is found not to be entitled to indemnification.

 

ii.In any case of indemnification other than that described in Section 8(f)(i)
above, the Indemnifying Party shall pay all legal fees and expenses reasonably
incurred by 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 (in addition to local counsel) that has
been participating by a majority of the indemnified parties against which such
action is finally brought; and if 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.

 

9.Contribution.

 

(a)If the indemnification provided for in Section 8 is for any reason
unavailable to or insufficient to hold harmless an Indemnified Party in respect
of any losses, liabilities, claims, damages or expenses referred to therein,
then each indemnifying party shall contribute to the aggregate amount of such
losses, liabilities, claims, damages and expenses incurred by such Indemnified
Party, as incurred, (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company, the Dealer Manager and the Selected
Dealer, respectively, from the proceeds received in the Offering pursuant to
this Agreement and the relevant Selected Dealer Agreement, or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company, the Dealer
Manager and the Selected Dealer, respectively, in connection with the statements
or omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.

 

20

 

 

(b)The relative benefits received by the Company, the Dealer Manager and the
Selected Dealer, respectively, in connection with the proceeds received in the
Offering pursuant to this Agreement and the relevant Selected Dealer Agreement
shall be deemed to be in the same respective proportion as the total net
proceeds from the Offering pursuant to this Agreement and the relevant Selected
Dealer Agreement (before deducting expenses), received by the Company, and the
total selling commissions and dealer manager fees received by the Dealer Manager
and the Selected Dealer, respectively, in each case as set forth on the cover of
the Prospectus bear to the aggregate offering price of the Shares sold in the
Offering as set forth on such cover.

 

(c)The relative fault of the Company, the Dealer Manager and the Selected
Dealer, respectively, shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact related to information
supplied by the Company, by the Dealer Manager or by the Selected Dealer,
respectively, and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.

 

(d)The Company, the Dealer Manager and the Selected Dealer (by virtue of
entering into the Selected Dealer Agreement) agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable contributions referred to above in this Section 9. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
Indemnified Party and referred to above in this Section 9 shall be deemed to
include any legal or other expenses reasonably incurred by such Indemnified
Party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission or alleged omission.

 

(e)Notwithstanding the provisions of this Section 9, the Dealer Manager and the
Selected Dealer shall not be required to contribute any amount by which the
total price at which the Shares sold in the Offering to the public by them
exceeds the amount of any damages which the Dealer Manager and the Selected
Dealer have otherwise been required to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission.

 

(f)No party guilty of “fraudulent misrepresentation” (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
party who was not guilty of such fraudulent misrepresentation.

 

(g)For the purposes of this Section 9, the Dealer Manager’s officers, directors,
employees, members, partners, agents and representatives, and each Person, if
any, who controls the Dealer Manager within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution of the Dealer Manager, and each officers, directors, employees,
members, partners, agents and representatives of the Company, each officer of
the Company who signed the Registration Statement and each Person, if any, who
controls the Company, within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act shall have the same rights to contribution from
the Company. The Selected Dealers’ respective obligations to contribute pursuant
to this Section 9 are several in proportion to the number of Shares sold by each
Selected Dealer in the Offering and not joint.

 

21

 

 

10.Termination of this Agreement.

 

(a)Term; Expiration. This Agreement shall become effective on the initial
Effective Date. Unless sooner terminated pursuant to this Section 10(a), this
Agreement shall expire at the end of the Offering Period (subject to
reinstatement of the Offering Period pursuant to the provisions of Section 3.
This Agreement may be earlier terminated by the Company pursuant to Section
10(b) or by the Dealer Manager pursuant to Section 10(c). The date upon which
this Agreement shall have so expired or been terminated earlier shall be
referred to as the “Termination Date.”

 

(b)Termination by the Company. Beginning six months following the initial
Effective Date, this Agreement may be terminated at the sole option of the
Company, upon at least 60 days’ prior written notice to the Dealer Manager. The
Company also may terminate this Agreement immediately, subject to the 30-day
cure period for a “for Cause” termination due to a material breach of this
Agreement, upon written notice of termination from the Board of Directors of the
Company to the Dealer Manager if any of the following events occur:

 

i.For Cause (as defined below);

 

ii.A court of competent jurisdiction enters a decree or order for relief in
respect of the Dealer Manager in any involuntary case under the applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
appoints a receiver, liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of the Dealer Manager or for any substantial part of its
property or orders the winding up or liquidation of the Dealer Manager’s
affairs; or

 

iii.The Dealer Manager commences a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consents to the entry of an order for relief in an involuntary case under any
such law, or consents to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
the Dealer Manager or for any substantial part of its property, or makes any
general assignment for the benefit of creditors, or fails generally to pay its
debts as they become due.

 

As used above, “Cause” shall mean fraud, criminal conduct, willful misconduct or
willful or grossly negligent breach of the Dealer Manager’s obligations under
this Agreement which materially adversely affects the Dealer Manager’s ability
to perform its duties; or a material breach of this Agreement by the Dealer
Manager which materially adversely affects the Dealer Manager’s ability to
perform its duties, provided that (A) Dealer Manager does not cure any such
material breach within 30 days of receiving notice of such material breach from
the Company, or (B) if such material breach is not of a nature that can be
remedied within such period, the Dealer Manager does not diligently take all
reasonable steps to cure such breach or does not cure such breach within a
reasonable time period.

 

(c)Termination by Dealer Manager. Beginning six months following the initial
Effective Date, this Agreement may be terminated at the sole option of the
Dealer Manager, upon at least 60 days’ prior written notice to the Company. The
Dealer Manager also may terminate this Agreement immediately, subject to the
30-day cure period for a “for Good Reason” termination due to a material breach
of this Agreement, upon written notice of termination from the Dealer Manager to
the Company if any of the following events occur:

 

i.For Good Reason (as defined below);

 

22

 

 

ii.A court of competent jurisdiction enters a decree or order for relief in
respect of the Company in any involuntary case under the applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or appoints a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of the Company or for any substantial part of its property or orders
the winding up or liquidation of the Company’s affairs;

 

iii.The Company commences a voluntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or consents to the
entry of an order for relief in an involuntary case under any such law, or
consents to the appointment of or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of the Company
or for any substantial part of their property, or makes any general assignment
for the benefit of creditors, or fails generally to pay its debts as they become
due;

 

iv.There shall have been a material change in the nature of the business
conducted or contemplated to be conducted as set forth in the Registration
Statement at the initial Effective Date by the Company;

 

v.There shall have occurred a Company MAE, whether or not arising in the
ordinary course of business;

 

vi.A stop order suspending the effectiveness of the Registration Statement shall
have been issued by the Commission and is not rescinded within 10 business days
after the issuance thereof; or

 

vii.A material action, suit, proceeding or investigation of the type referred to
in Section 1(g) shall have occurred or arisen on or after the initial Effective
Date.

 

As used above, “Good Reason” shall mean fraud, criminal conduct, willful
misconduct or willful or grossly negligent breach of the Company’s obligations
under this Agreement, or a material breach of this Agreement by the Company,
provided that (i) the Company does not cure any such material breach within 30
days of receiving notice of such material breach from the Dealer Manager, or
(ii) if such material breach is not of a nature that can be remedied within such
period, the Company does not diligently take all reasonable steps to cure such
breach or does not cure such breach within a reasonable time period.

 

(d)Delivery of Records upon Expiration or Early Termination. Upon the expiration
or early termination of this Agreement for any reason, the Dealer Manager shall
(i) promptly forward any and all funds, if any, in its possession which were
received from investors for the sale of Shares into the Escrow Account for the
deposit of investor funds, (ii) to the extent not previously provided to the
Company, provide a list of all investors who have subscribed for or purchased
shares and all broker-dealers with whom the Dealer Manager has entered into a
Selected Dealer Agreement, (iii) notify Selected Dealers of such termination,
and (iv) promptly deliver to the Company copies of any sales literature designed
for use specifically for the Offering that it is then in the process of
preparing. Upon expiration or earlier termination of this Agreement, the Company
shall pay to the Dealer Manager all compensation to which the Dealer Manager is
or becomes entitled under Section 3(f) at such time as such compensation becomes
payable.

 

11.Miscellaneous.

 

(a)Survival. The following provisions of the Agreement shall survive the
expiration or earlier termination of this Agreement: Sections 3(f), 7, 8, 9, 10
and 11. Notwithstanding anything else that may be to the contrary herein, the
expiration or earlier termination of this Agreement shall not relieve a party
for liability for any breach occurring prior to such expiration or earlier
termination.

 

23

 

 

(b)Notices. All notices, consents, approvals, waivers or other communications
required or permitted hereunder (each a “Notice”) shall be in writing and shall
be: (i) delivered personally or by commercial messenger; (ii) sent by a
recognized overnight courier service; or (iii) sent by facsimile transmission,
provided confirmation of receipt is received by sender and such Notice is sent
or delivered contemporaneously by an additional method provided hereunder; in
each case above provided such Notice is addressed to the intended recipient
thereof as set forth below:

 

If to the Company: Business Development Corporation of America II   405 Park
Avenue   3rd Floor   New York, NY 10022   Facsimile No:  (212) 421-5799  
Attention:  General Counsel       with a copy to (which shall not constitute a
Notice):       Alston & Bird LLP   1201 West Peachtree Street   Atlanta,
GA  30309   Facsimile No:  (404) 253-8447   Attention:  Rosemarie A. Thurston  
  If to the Adviser: BDCA Adviser II, LLC   405 Park Avenue   3rd Floor   New
York, NY 10022   Facsimile No:  (212) 421-5799       Attention:  General Counsel
      with a copy to (which shall not constitute a Notice):       Alston & Bird
LLP   1201 West Peachtree Street   Atlanta, GA  30309   Facsimile No:  (404)
253-8447   Attention:  Rosemarie A. Thurston     If to the Dealer Manager:
Realty Capital Securities, LLC   One Beacon Street, 14th Floor   Boston, MA
02108   Facsimile No.:  (857) 207-3399   Attention:  Louisa Quarto, President  
    with a copy to (which shall not constitute a Notice):       Alston & Bird
LLP   1201 West Peachtree Street   Atlanta, GA  30309   Facsimile No:  (404)
253-8447   Attention:  Rosemarie A. Thurston

 

Any party may change its address specified above by giving each party Notice of
such change in accordance with this Section 11(b).

 

(c)Successors and Assigns. No party shall assign (voluntarily, by operation of
law or otherwise) this Agreement or any right, interest or benefit under this
Agreement without the prior written consent of each other party. Subject to the
foregoing, this Agreement shall be fully binding upon, inure to the benefit of,
and be enforceable by, the parties hereto and their respective successors and
assigns.

 

24

 

 

(d)Invalid Provision. The invalidity or unenforceability of any provision of
this Agreement shall not affect the other provisions hereof, and this Agreement
shall be construed in all respects as if such invalid or unenforceable provision
were omitted.

 

(e)Applicable Law. This Agreement and any disputes relative to the
interpretation or enforcement hereto shall be governed by and construed under
the internal laws, as opposed to the conflicts of laws provisions, of the State
of New York.

 

(f)Waiver. EACH OF THE PARTIES HERETO WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, SUIT, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT OR
OTHERWISE) RELATED TO OR ARISING OUT OF THIS AGREEMENT. The parties hereto each
hereby irrevocably submits to the exclusive jurisdiction of the courts of the
State of New York and the Federal courts of the United States of America located
in the Borough of Manhattan, New York City, in respect of the interpretation and
enforcement of the terms of this Agreement, and in respect of the transactions
contemplated hereby, and each hereby waives, and agrees not to assert, as a
defense in any action, suit or proceeding for the interpretation or enforcement
hereof, that it is not subject thereto or that such action, suit or proceeding
may not be brought or is not maintainable in said courts or that the venue
thereof may not be appropriate or that this Agreement may not be enforced in or
by such courts, and the parties hereto each hereby irrevocably agrees that all
claims with respect to such action or proceeding shall be heard and determined
in such a New York State or Federal court.

 

(g)Attorneys’ Fees. If a dispute arises concerning the performance, meaning or
interpretation of any provision of this Agreement or any document executed in
connection with this Agreement, then the prevailing party in such dispute shall
be awarded any and all costs and expenses incurred by the prevailing party in
enforcing, defending or establishing its rights hereunder or thereunder,
including, without limitation, court costs and attorneys and expert witness
fees. In addition to the foregoing award of costs and fees, the prevailing also
shall be entitled to recover its attorneys’ fees incurred in any post-judgment
proceedings to collect or enforce any judgment.

 

(h)No Partnership. Nothing in this Agreement shall be construed or interpreted
to constitute the Dealer Manager or the Selected Dealers as being in association
with or in partnership with the Company or one another, and instead, this
Agreement only shall constitute the Dealer Manager as a broker 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.
Nothing herein contained shall render the Dealer Manager or the Company liable
for the obligations of any of the Selected Dealers or one another.

 

(i)Third-Party Beneficiaries . Except for the Persons referred to in Sections 8
and 9, there shall be no third-party beneficiaries of this Agreement, and no
provision of this Agreement is intended to be for the benefit of any Person not
a party to this Agreement, and no third party shall be deemed to be a
beneficiary of any provision of this Agreement. Except for the Persons referred
to in Sections 8 and 9, no third party shall by virtue of any provision of this
Agreement have a right of action or an enforceable remedy against any party to
this Agreement. Each of the Persons referred to in Sections 8 and 9 shall be a
third-party beneficiary of this Agreement.

 

(j)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 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.

 

25

 

 

(k)Nonwaiver. The failure of any party to insist upon or enforce strict
performance by any other party of any provision of this Agreement or to exercise
any right under this Agreement shall not be construed as a waiver or
relinquishment to any extent of such party’s right to assert or rely upon any
such provision or right in that or any other instance; rather, such provision or
right shall be and remain in full force and effect.

 

(l)Access to Information. The Company may authorize the Company’s transfer agent
to provide information to the Dealer Manager and each Selected Dealer regarding
record holder information about the clients of such Selected Dealer who have
invested with the Company on an ongoing basis for so long as such Selected
Dealer has a relationship with such clients. The Dealer Manager shall require in
the Selected Dealer Agreement that Selected Dealer not disclose any password for
a restricted website or portion of website provided to such Selected Dealer in
connection with the Offering and not disclose to any Person, other than an
officer, director, employee or agent of such Selected Dealers, any material
downloaded from such a restricted website or portion of a restricted website.

 

(m)Counterparts. This Agreement may be executed (including by facsimile
transmission) with counterpart signature pages or in counterpart copies, each of
which shall be deemed an original but all of which together shall constitute one
and the same instrument comprising this Agreement.

 

(n)Absence of Fiduciary Relationships. The parties acknowledge and agree that
(i) the Dealer Manager’s responsibility to the Company or the Adviser is solely
contractual in nature, and (ii) the Dealer Manager does not owe the Company, the
Adviser, any of their respective affiliates or any other Person any fiduciary
(or other similar) duty as a result of this Agreement or any of the transactions
contemplated hereby.

 

(o)Dealer Manager Information. Prior to the initial Effective Date, the parties
will expressly acknowledge and agree as to the information furnished to the
Company by the Dealer Manager expressly for use in the Registration Statement.

 

(p)Promotion of Relationship. The Company and the Dealer Manager will cooperate
with each other in good faith in connection with the promotion or advertisement
of their relationship in any release, communication, sales literature or other
such materials and shall not promote or advertise their relationship without the
approval of the other party in advance, which shall not be unreasonably withheld
or delayed.

 

(q)Titles and Subtitles. The titles and subtitles used in this Agreement are
used for convenience only and are not to be considered in construing or
interpreting this Agreement.

 

[Signatures on following page.]

 

 

26

 

 

IN WITNESS WHEREOF, the parties hereto have each duly executed this Dealer
Manager Agreement as of the day and year set forth above.

 

COMPANY:

 

BUSINESS DEVELOPMENT CORPORATION OF AMERICA II

 

 

By: /s/ Nicholas S. Schorsch

Name: Nicholas S. Schorsch

Title: Chief Executive Officer

 

ADVISER:

 

BDCA Adviser II, LLC

 

By: /s/ Peter M. Budko 

Name: Peter M. Budko

Title: Chief Executive Officer

 

Accepted as of the date first above written:

 

DEALER MANAGER:

 

REALTY CAPITAL SECURITIES, LLC

 

By: /s/ Louisa Quarto

Name: Louisa Quarto

Title: President

 

 

27

 

 

EXHIBIT A

 

BUSINESS DEVELOPMENT CORPORATION OF AMERICA II

SELECTED DEALER AGREEMENT

 

Ladies and Gentlemen:

 

Realty Capital Securities, LLC (the “Dealer Manager”) entered into an exclusive
dealer manager agreement, dated as of September 8, 2014 (the “Dealer Manager
Agreement”), with Business Development Corporation of America II, a Maryland
corporation that intends to elect to be treated as a business development
company under the Investment Company Act of 1940, as amended, (the “Company”),
pursuant to which the Dealer Manager agreed to use its reasonable best efforts
to solicit subscriptions in connection with the public offering (the “Offering”)
of up to 300,000,000 shares of the Company’s common stock, par value $0.001 per
share (the “Shares”), on a continuous basis, for an initial purchase price of
$10.00 per Share, commencing on the Effective Date (as defined below). Unless
otherwise defined herein, capitalized terms used herein shall have the
respective meanings therefor as in the Dealer Manager Agreement.

 

In connection with the performance of the Dealer Manager’s obligations under
Section 3 of the Dealer Manager Agreement, the Dealer Manager is authorized to
retain the services of securities dealers (the “Selected Dealers”) who are
members of the Financial Industry Regulatory Authority, Inc. (“FINRA”) to
solicit subscriptions for Shares in connection with the Offering. You are hereby
invited to become a Selected Dealer and, as such, to use your reasonable best
efforts to solicit subscribers for the Shares, in accordance with the following
terms and conditions of this Selected Dealer Agreement (this “Agreement”):

 

1. Registration Statement.

 

(a) A registration statement on Form N-2 (File No. 333-197447), including a
preliminary prospectus, has been prepared by the Company and was filed with the
Securities and Exchange Commission (the “Commission”) on July 16, 2014 in
accordance with the applicable requirements of the Securities Act of 1933, as
amended (the “Securities Act”), and the applicable rules and regulations of the
Commission promulgated thereunder (the “Securities Act Rules and Regulations”)
for the registration of the Offering. The Company has prepared and filed such
amendments thereto and such amended prospectuses as may have been required to
the date hereof, and will file such additional amendments and supplements
thereto as may hereafter be required. The registration statement on Form N-2 and
the prospectus contained therein, as finally amended at the date the
registration statement is declared effective by the Commission (the “Effective
Date”), are respectively hereinafter referred to as the “Registration Statement”
and the “Prospectus”, except that (i) if the Company files a post-effective
amendment to such registration statement, then the term “Registration Statement”
shall, from and after the declaration of the effectiveness of such
post-effective amendment by the Commission, refer to such registration statement
as amended by such post-effective amendment, and the term “Prospectus” shall
refer to the amended prospectus then on file with the Commission, and (ii) if
the Company files a prospectus or prospectus supplement pursuant to Rule 497 of
the Securities Act Rules and Regulations which differs from the prospectus on
file at the time the Registration Statement or the most recent post-effective
amendment thereto, if any, shall have become effective, then the term
“Prospectus” shall refer to such prospectus or include such prospectus
supplement, as applicable, filed pursuant to Rule 497 of the Securities Act
Rules and Regulations, as the case may be, from and after the date on which it
shall have been filed. The term “Preliminary Prospectus” as used in this
Agreement 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. As used
in this Agreement, the terms “Registration Statement,” “Preliminary Prospectus”
and “Prospectus” shall include the documents incorporated by reference therein
pursuant to Instruction F of Form N-2, including any portion of the Company’s
annual report on Form 10-K. As used in this Agreement, the term “Effective Date”
also shall refer to the effective date of each post-effective amendment to the
Registration Statement, unless the context otherwise requires.

 

2. Compliance with Applicable Rules and Regulations.

 

Upon the effectiveness of this Agreement, the undersigned dealer will become one
of the “Selected Dealers” referred to in the Dealer Manager Agreement and is
referred to herein as “Selected Dealer”. Selected Dealer agrees that
solicitation and other activities by it hereunder shall comply with, and shall
be undertaken only in accordance with, the terms of the Dealer Manager
Agreement, the terms of this Agreement, the Securities Act, the Securities Act
Rules and Regulations, the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), and the applicable rules and regulations promulgated thereunder
(the “Exchange Act Rules and Regulations”), the Blue Sky Survey (as defined
below), the FINRA Rules (including, without limitation, FINRA Rules 2310, 5110,
5131 and 5141), NASD Rules 2340 and 2420, and the provisions of Article III.C.
of the Omnibus Guidelines published by the North American Securities
Administrators Association, Inc., as revised and amended on May 7, 2007 and as
may be further revised and amended (the “NASAA Guidelines”).

 

 

 

 

Selected Dealer’s acceptance of this Agreement constitutes a representation to
both the Company and to the Dealer Manager that Selected Dealer is a properly
registered or licensed broker-dealer, duly authorized to sell Shares under
federal and state securities laws and regulations in all states where it offers
or sells Shares, and that it is a member in good standing of FINRA. Selected
Dealer represents and warrants that it is currently licensed as a broker-dealer
in the jurisdictions identified on Schedule 1 to this Agreement and that its
independent contractors and registered representatives have the appropriate
licenses to offer and sell the Shares in such jurisdictions. This Agreement
shall automatically terminate with no further action by either party if Selected
Dealer ceases to be a member in good standing of FINRA or with the securities
commission of any state in which Selected Dealer is currently registered or
licensed. Selected Dealer agrees to notify the Dealer Manager immediately if
Selected Dealer ceases to be a member in good standing of FINRA or with the
securities commission of any state in which Selected Dealer is currently
registered or licensed.

 

3. Limitation of Offer and Investor Suitability.

 

(a) Selected Dealer will offer Shares only (i) to persons that 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 (ii)
in accordance with Section 8, to persons in the jurisdictions in which it is
advised in writing by the Company or the Dealer Manager that the Shares are
qualified for sale or that qualification is not required (the “Blue Sky
Survey”). Notwithstanding the qualification of Shares for sale in any respective
jurisdiction (or exemption therefrom), Selected Dealer will not offer Shares and
will not permit any of its registered representatives to offer Shares in any
jurisdiction unless both Selected Dealer and such registered representative are
duly licensed to transact securities business in such jurisdiction. In offering
Shares, Selected Dealer shall comply with the FINRA Rules and NASD Conduct
Rules, as well as those other applicable rules and regulations relating to
suitability of investors, including, but not limited to, the provisions of
Section III.C. of the NASAA Guidelines.

 

In offering the sale of Shares to any person, Selected Dealer will have
reasonable grounds to believe (based on such information obtained from the
investor concerning the investor’s age, investment objectives, other
investments, financial situation, needs or any other information known by
Selected Dealer after due inquiry) that: (A) such person is in a financial
position appropriate to enable such person to realize to a significant extent
the benefits described in the Prospectus, including the tax benefits where they
are a significant aspect of the Company; (B) the investor has a fair market net
worth sufficient to sustain the risks inherent in the program, including loss of
investment and lack of liquidity; (C) the purchase of the Shares is otherwise
suitable for such person; (D) such person has either: (1) a minimum annual gross
income of $70,000 and a minimum net worth (exclusive of such person’s home, home
furnishings and automobiles) of $70,000; or (2) a minimum net worth (exclusive
of such person’s home, home furnishings and automobiles) of $250,000 and meets
the higher suitability standards, if applicable, imposed by the state in which
the investment by such investor is made. Selected Dealer further will use its
best efforts to determine the suitability and appropriateness of an investment
in the Shares of each proposed investor solicited by a person associated with
Selected Dealer by reviewing documents and records disclosing the basis upon
which the determination as to suitability was reached as to each proposed
investor, whether such documents and records relate to accounts which have been
closed, accounts which are currently maintained or accounts hereinafter
established. In making the determinations as to financial qualifications and as
to suitability required by the NASAA Guidelines, Selected Dealer may rely on (x)
representations from investment advisers who are not affiliated with Selected
Dealer, banks acting as trustees or fiduciaries, and (y) information it has
obtained from a prospective investor, including such information as the
investment objectives, other investments, financial situation and needs of the
person or any other information known by Selected Dealer after due inquiry.
Notwithstanding the foregoing, Selected Dealer shall not execute any transaction
in the Company in a discretionary account without prior written approval of the
transaction by the customer.

 

 

 

 

(b) Selected Dealer shall maintain, for at least six years or for a period of
time not less than that required in order to comply with all applicable federal,
state and other regulatory requirements, whichever is later, a record of the
information obtained to determine that an investor meets the suitability
standards imposed on the offer and sale of the Shares (both at the time of the
initial subscription and at the time of any additional subscriptions) and a
representation of the investor that the investor is investing for the investor’s
own account or, in lieu of such representation, information indicating that the
investor for whose account the investment was made met the suitability
standards. Selected Dealer may satisfy its obligation by contractually requiring
such information to be maintained by the investment advisers or banks discussed
above. Selected Dealer further agrees to comply with the record keeping
requirements of the Exchange Act, including, but not limited to, Rules 17a-3 and
17a-4 of the Exchange Act Rules and Regulations. Selected Dealer agrees to make
such documents and records available to the Dealer Manager and the Company upon
request, and representatives of the Commission, FINRA and applicable state
securities administrators upon Selected Dealer’s receipt of an appropriate
document subpoena or other appropriate request for documents from any such
agency.

 

4. Delivery of Prospectus and Approved Sales Literature.

 

(a) Selected Dealer will: (i) deliver a Prospectus, as then supplemented or
amended, to each person who subscribes for Shares at least five business days
prior to the tender of such person’s subscription agreement (the “Subscription
Agreement”); (ii) promptly comply with the written request of any person for a
copy of the Prospectus, as then supplemented or amended, during the period
between the initial Effective Date and the termination of the Offering; (iii)
deliver to any person, in accordance with applicable law or as prescribed by any
state securities administrator, a copy of any prescribed document included
within or incorporated by reference in the Registration Statement and any
supplements thereto during the course of the Offering; (iv) not use any sales
materials in connection with the solicitation of purchasers of the Shares except
Approved Sales Literature; (v) to the extent the Company provides Approved Sales
Literature, not use such materials unless accompanied or preceded by the
Prospectus, as then currently in effect, and as may be supplemented in the
future; and (vi) not give or provide any information or make any representation
or warranty other than information or representations contained in the
Prospectus or the Approved Sales Literature. Selected Dealer will not publish,
circulate or otherwise use any other advertisement or solicitation material in
connection with the Offering without the Dealer Manager’s express prior written
approval.

 

(b) Nothing contained in this Agreement shall be deemed or construed to make
Selected Dealer an employee, agent, representative or partner of the Dealer
Manager or the Company, and Selected Dealer is not authorized to act for the
Dealer Manager or the Company except pursuant to this Agreement. Selected Dealer
will not send or provide supplements to the Prospectus or any Approved Sales
Literature to any investor unless it has previously sent or provided a
Prospectus and all supplements thereto to that investor or has simultaneously
sent or provided a Prospectus and all supplements thereto with such Prospectus
supplement or Approved Sales Literature.

 

(d) Selected Dealer will not show to or provide any investor or reproduce any
material or writing which is supplied to it by the Dealer Manager and marked
“broker-dealer use only” or otherwise bearing a legend denoting that it is not
to be used in connection with the offer or sale of Shares to members of the
public.

 

(e) The Dealer Manager will supply Selected Dealer with reasonable quantities of
the Prospectus (including any supplements thereto), as well as any Approved
Sales Literature, for delivery to investors.

 

(f) Selected Dealer shall 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 mail or otherwise deliver all
preliminary and final Prospectuses required for compliance with the provisions
of Rule 15c2-8 of the Exchange Act Rules and Regulations.

 

(g) Selected Dealer agrees that it will rely upon no statement whatsoever,
written or oral, other than the statements in the Prospectus. Selected Dealer is
not authorized by the Dealer Manager or the Company to give any information or
to make any representation not contained in the Prospectus in connection with
the sale of the Shares.

 

 

 

 

5. Submission of Orders.

 

(a) Subject to certain individual state requirements as described in the
Prospectus, Shares may be sold only to investors who initially purchase a
minimum of 250 Shares for $2,500 or, unless prohibited by state law, a husband
and wife may jointly contribute funds from their separate individual retirement
accounts, or IRAs, provided that each such contribution is made in increments of
$500. With respect to Selected Dealer’s participation in any resales or
transfers of the Shares, Selected Dealer agrees to comply with any applicable
requirements set forth in Section 2 and to fulfill the obligations pursuant to
Rule 2310 of the FINRA Rules of Conduct.

 

(b) Until the minimum offering of $2,000,000 in Shares (the “Minimum Offering”)
has been sold, payments for Shares shall be made by checks payable to “UMB Bank,
N.A., Agent for Business Development Corporation of America II” During such
time, Selected Dealer shall forward original checks together with an original
Subscription Agreement, completed, executed and appropriately initialed by the
subscriber as provided for in the Subscription Agreement, to UMB Bank, N.A. (the
“Escrow Agent”) at the address provided in the Subscription Agreement. If the
minimum amount has not been obtained prior to the termination date, the Escrow
Agent shall, promptly following the termination date, but in no event more than
30 days after the termination date, refund to each investor by check funds
deposited in the escrow account, or shall return the instruments of payment
delivered to Escrow Agent if such instruments have not been processed for
collection prior to such time, directly to each investor at the address provided
in the list of investors.

 

When Selected Dealer’s internal supervisory procedures are conducted at the site
at which the Subscription Agreement and check were initially received by
Selected Dealer from the subscriber, Selected Dealer shall transmit the
Subscription Agreement and check to the Escrow Agent by the end of the next
business day following receipt of the check and Subscription Agreement. When,
pursuant to Selected Dealer’s internal supervisory procedures, Selected Dealer’s
final internal supervisory procedures are conducted at a different location (the
“Final Review Office”), Selected Dealer shall transmit the check and
Subscription Agreement to the Final Review Office by the end of the next
business day following Selected Dealer’s receipt of the Subscription Agreement
and check. The Final Review Office will, by the end of the next business day
following its receipt of the Subscription Agreement and check, forward both the
Subscription Agreement and check to the Escrow Agent. If any Subscription
Agreement solicited by Selected Dealer is rejected by the Dealer Manager or the
Company, then the Subscription Agreement and check will be returned to the
rejected subscriber within 10 business days from the date of rejection.

 

Once the Minimum Offering has been sold, subject to any continuing escrow
obligations imposed by certain states as described in the Prospectus, payments
for Shares shall be made payable to “Business Development Corporation of America
II” At such time, Selected Dealer shall forward original checks together with an
original Subscription Agreement, executed and initialed by the subscriber as
provided for in the Subscription Agreement, to Business Development Corporation
of America II, c/o American National Stock Transfer, LLC, at the address
provided in the Subscription Agreement.

 

Notwithstanding the foregoing, in accordance with the applicable Exchange Act
Rules and Regulations, if Selected Dealer has net capital of $250,000 or more it
may instruct its customers to make their checks payable to Selected Dealer. In
such case, Selected Dealer shall issue a check made payable to the Escrow Agent
or the Company in accordance with the foregoing provisions of this Section 5(b),
as applicable.

 

(c) All orders, whether initial or additional, are subject to acceptance by, and
shall become effective upon confirmation by, the Company or the Dealer Manager,
each of which reserve the right to reject any order in their sole discretion for
any or no reason. Orders not accompanied by the required instrument of payment
for Shares may be rejected. Issuance and delivery of a Share will be made only
after a sale of a Share is deemed by the Company to be completed in accordance
with Section 3(e) of the Dealer Manager Agreement. If an order is rejected,
cancelled or rescinded for any reason, then Selected Dealer will return to the
Dealer Manager any selling commissions or Dealer Manager Fees theretofore paid
with respect to such order, and, if Selected Dealer fails to so return any such
selling commissions, the Dealer Manager shall have the right to offset amounts
owned against future commissions or Dealer Manager Fees due and otherwise
payable to Selected Dealer (it being understood and agreed that such right to
offset shall not be in limitation of any other rights or remedies that the
Dealer Manager may have in connection with such failure).

 

 

 

 

6. Selected Dealer Compensation.

 

(a) Subject to the terms and conditions set forth herein and in the Dealer
Manager Agreement and, subject to the volume discounts and other special
circumstances described in the “Plan of Distribution” section of the Prospectus,
the Dealer Manager shall pay to Selected Dealer a selling commission of up to 7%
of the gross proceeds from the Shares sold by it and accepted and confirmed by
the Company. The Dealer Manager shall receive a Dealer Manager Fee of 3% of
gross Offering proceeds. Alternatively, a Selected Dealer may elect to receive a
fee equal to 7.5% of gross proceeds from the sale of Shares by such Selected
Dealer, with 2.5% thereof paid at the time of such sale and 1% thereof paid on
each anniversary of the closing of such sale up to and including the fifth
anniversary of the closing of such sale, in which event, a portion of the Dealer
Manager fee will be reallowed such that the combined selling commission and
Dealer Manager Fee do not exceed 10% of gross proceeds of the Offering. If
Selected Dealer receives a 7.5% sales commission, then the Dealer Manager will
receive a 2.5% Dealer Manager Fee. For purposes of this Section 6(a), Shares are
“sold” only if an executed Subscription Agreement is accepted by the Company and
the Company has thereafter distributed the commission to the Dealer Manager in
connection with such transaction. Selected Dealer acknowledges and agrees that
no Selling Commissions will be paid for sales of dividend reinvestment plan
Shares or in connection with the sale of Shares to investors whose contracts for
investment advisory and related brokerage services include a fixed or “wrap” fee
feature. In addition, if an investor has either engaged the services of a
registered investment advisor or other financial advisor who will be paid
compensation for investment advisory services or other financial or investment
advice or is investing through a bank trust account with respect to which such
investor has delegated the decision-making authority for investments made
through the account to a bank trust department, then such investor may agree
with Selected Dealer to reduce the amount of Selling Commissions payable with
respect to the sale of its Shares down to zero.

 

(b) Notwithstanding the foregoing, it is understood and agreed that no
commission shall be payable with respect to particular Shares if the Dealer
Manager or the Company rejects a proposed subscriber’s Subscription Agreement.
Accordingly, Selected Dealer shall have no authority to issue a confirmation
(pursuant to Rule 10b-10 of the Exchange Act Rules and Regulations) to any
subscriber; such authority residing solely in the Dealer Manager, as the Dealer
Manager and processing broker-dealer of the Offering.

 

(c) The Dealer Manager may, in its sole discretion, reallow up to 50% of the
Dealer Manager Fee received by it to Selected Dealer. The Dealer Manager may, in
its sole discretion, request that the Company reimburse Selected Dealer for
reasonable accountable bona fide due diligence expenses, provided such expenses
have actually been incurred, are supported by detailed and itemized invoices
provided to the Company and the Company had given its prior written approval of
the incurrence of such expenses.

 

(d) Certain marketing expenses such as Selected Dealer conferences may be
advanced to Selected Dealer and later deducted from the portion of the Dealer
Manager Fee reallowed to such Selected Dealer. If the Offering is not
consummated, Selected Dealer will repay any such advance to the extent not
expended on marketing expenses. Any such advance shall be deducted from the
maximum amount of the Dealer Manager Fee that may otherwise be reallowable to
Selected Dealer. Notwithstanding anything herein to the contrary, Selected
Dealer will not be entitled to receive any Dealer Manager Fee reallowance which
would cause the aggregate amount of selling commissions, Dealer Manager Fees and
other forms of underwriting compensation (as defined in accordance with
applicable FINRA rules) received by the Dealer Manager and all Selected Dealers
to exceed 10% of the gross Offering proceeds.

 

(e) The Company will not be liable or responsible to any Selected Dealer for the
payment of any selling commissions or any reallowance of Dealer Manager Fees to
Selected Dealer, it being the sole and exclusive responsibility of the Dealer
Manager for the payment of selling commissions or any reallowance of fees to
Selected Dealer. Selected Dealer acknowledges and agrees that the Dealer
Manager’s liability for commissions payable to Selected Dealer is limited solely
to commissions received by the Dealer Manager from the Company in connection
with Selected Dealer’s sale of Shares.

 

(f) In no event shall the Soliciting Dealer be entitled to payment of any
compensation in connection with the Offering that is not completed according to
this Agreement.

 

 

 

 

7. Reserved Shares. The number of Shares, if any, to be reserved for sale by
each Selected Dealer may be decided by the mutual agreement, from time to time,
of the Dealer Manager and the Company. The Dealer Manager reserves the right to
notify Selected Dealer by U.S. mail or by other means of the number of Shares
reserved for sale by Selected Dealer, if any. Such Shares will be reserved for
sale by Selected Dealer until the time specified in the Dealer Manager’s
notification to Selected Dealer. Sales of any reserved Shares after the time
specified in the notification to Selected Dealer or any requests for additional
Shares will be subject to rejection in whole or in part.

 

8. Blue Sky Qualification.

 

(a) The Dealer Manager will inform Selected Dealer as to the jurisdictions in
which the Dealer Manager has been advised by the Company that the Shares have
been qualified for sale or are exempt under the respective securities or “blue
sky” laws of such jurisdictions, but the Dealer Manager has not assumed and will
not assume any obligation or responsibility as to Selected Dealer’s right to act
as a broker or dealer with respect to the Shares in any such jurisdiction.
Selected Dealer agrees that Selected Dealer will not make any offers or sell any
Shares except in states in which the Dealer Manager may advise Selected Dealer
that the Offering has been qualified or is exempt and in which Selected Dealer
is legally qualified to make offers and further agrees to assure that each
person to whom Selected Dealer sells Shares (at both the time of the initial
purchase as well as at the time of any subsequent purchases) meets any special
suitability standards which apply to sales in a particular jurisdiction, as
described in the Blue Sky Survey and the Subscription Agreement. Neither the
Dealer Manager nor the Company assume any obligation or responsibility in
respect of the qualification of the Shares covered by the Prospectus under the
laws of any jurisdiction or Selected Dealer’s qualification to act as a broker
and/or dealer with respect to the Shares in any jurisdiction. The Blue Sky
Survey which has been or will be furnished to Selected Dealer indicates the
jurisdictions in which it is believed that the offer and sale of Shares covered
by the Prospectus is exempt from, or requires action under, the applicable blue
sky or securities laws thereof, and what action, if any, has been taken with
respect thereto.

 

(b) It is understood and agreed that under no circumstances will Selected
Dealer, as a Selected Dealer, engage in any activities hereunder in any
jurisdiction in which Selected Dealer may not lawfully so engage or in any
activities in any jurisdiction with respect to the Shares in which Selected
Dealer may lawfully so engage unless Selected Dealer have complied with the
provisions hereof.

 

9. Dealer Manager’s Authority.

 

Subject to the Dealer Manager Agreement, the Dealer Manager shall have full
authority to take such action as it may deem advisable with respect to all
matters pertaining to the Offering or arising thereunder. Except for obligations
and liabilities expressly assumed by the Dealer Manager hereunder, Dealer
Manager shall not be under any liability to Selected Dealer except (a) for its
own lack of good faith and (b) for, or in respect of, the validity or value of
or title to, the Shares; the form of, or the statements contained in, or the
validity of, the Registration Statement, the Prospectus or any amendment or
supplement thereto, or any other instrument executed by the Company or by
others; the form or validity of the Dealer Manager Agreement or this Agreement;
the delivery of the Shares; the performance by the Company or by others of any
agreement on its or their part; the qualification of the Shares for sale under
the laws of any jurisdiction; or any matter in connection with any of the
foregoing; provided, however, that nothing in this paragraph shall be deemed to
relieve the Company or the Dealer Manager from any liability imposed by the
Securities Act. No obligations or liability on the part of the Company or the
Dealer Manager shall be implied or inferred herefrom.

 

10. Indemnification.

 

(a) Under the Dealer Manager Agreement, the Company has agreed to indemnify
Selected Dealer and the Dealer Manager and each person, if any, who controls
Selected Dealer or the Dealer Manager, in certain instances and against certain
liabilities, including liabilities under the Securities Act in certain
circumstances. Selected Dealer hereby agrees to indemnify the Company and each
person who controls it as provided in the Dealer Manager Agreement and to
indemnify the Dealer Manager to the extent and in the manner that Selected
Dealer agrees to indemnify the Company in the Dealer Manager Agreement.

 

 

 

 

(b) In furtherance of, and not in limitation of the foregoing, Selected Dealer
will indemnify, defend and hold harmless the Dealer Manager and the Company, and
their officers, directors, employees, members, partners, affiliates, agents and
representatives, and each person, if any, who controls such entity within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
and each person who has signed the Registration Statement (“Indemnified
Parties”), from and against any losses, claims, damages or liabilities to which
any of the Indemnified Parties, and each person who signed the Registration
Statement, may become subject, under the Securities Act or the Exchange Act, or
otherwise, insofar as such losses, claims and expenses (including the reasonable
legal and other expenses incurred in investigating and defending any such claims
or liabilities), damages or liabilities (or actions in respect thereof) arise
out of or are based upon (i) in whole or in part, any material inaccuracy in the
representations or warranties contained in this Agreement or any material breach
of a covenant contained herein by Selected Dealer, or (ii) any untrue statement
or any alleged untrue statement of a material fact contained (A) in any
Registration Statement or any post-effective amendment thereto or in the
Prospectus or any amendment or supplement to the Prospectus, or (B) in any
Approved Sales Literature, or (C) 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, or (iii) the omission or alleged omission to state
a material fact required to be stated in the Registration Statement or any
post-effective amendment thereof to make the statements therein not misleading
or the omission or alleged omission to state a material fact required to be
stated in the Prospectus or any amendment or supplement to the Prospectus to
make the statements therein, in light of the circumstances under which they were
made, not misleading, provided, however, that in each case described in clauses
(ii) and (iii) to the extent, but only to the extent, that such untrue statement
or omission was made in reliance upon and in conformity with written information
furnished to the Company or the Dealer Manager by Selected Dealer specifically
for use with reference to Selected Dealer in the preparation of the Registration
Statement or any such post-effective amendments thereof or the Prospectus or any
such amendment thereof or supplement thereto, (iv) any use of sales literature,
including “broker dealer use only” materials, by Selected Dealer that is not
Approved Sales Literature, (v) any untrue statement made by Selected Dealer or
Selected Dealer’s representatives or agents or omission by Selected Dealer or
Selected Dealer’s representatives or agents to state a fact necessary in order
to make the statements made, in light of the circumstances under which they were
made, not misleading in connection with the offer and sale of the Shares in each
case, other than statements or omissions made in conformity with the
Registration Statement, Prospectus, Approved Sales Literature or any other
materials or information furnished by or on behalf of the Company, or (vi) any
failure by Selected Dealer to comply with applicable laws governing money
laundry abatement and anti-terrorist financing efforts in connection with the
Offering, including applicable FINRA Rules, Exchange Act Rules and Regulations
and the USA PATRIOT Act. Selected Dealer will reimburse the aforesaid parties
for any reasonable legal or other expenses incurred in connection with
investigation or defense of such loss, claim, damage, liability or action. This
indemnity agreement will be in addition to any liability which Selected Dealer
may otherwise have.

 

(c) Promptly after receipt by any Indemnified Party under this Section 10 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 10, promptly notify the indemnifying party of the commencement thereof;
provided, however, that the failure to give such notice shall not relieve the
indemnifying party of its obligations hereunder except to the extent it shall
have been actually prejudiced by such failure. 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 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, and unconditional release of all liabilities from, 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, such
consent not to be unreasonably withheld or delayed.

An indemnifying party under this Section 10 shall be obligated to reimburse an
Indemnified Party for reasonable legal and other expenses as follows: the
indemnifying party shall pay all legal fees and expenses reasonably incurred by
the Indemnified Party in the defense of such claims orLEGAL02/34788509v8

 

 

 

 

(d) 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 (in addition to local
counsel) that has been participating by a majority of the indemnified parties
against which such action is finally brought; and if 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.

 

11. Contribution.

 

If the indemnification provided for in Section 10 is for any reason unavailable
to or insufficient to hold harmless an indemnified party in respect of any
losses, liabilities, claims, damages or expenses referred to therein, the
contributions provisions set forth in Section 8 of the Dealer Manager Agreement
shall be applicable.

 

12. Company as Party to Agreement.

 

The Company shall be a third-party beneficiary of Selected Dealer’s
representations, warranties, covenants and agreements contained in Sections 10,
11 and 16. The Company shall have all enforcement rights in law and in equity
with respect to those portions of this Agreement as to which it is third party
beneficiary.

 

13. Privacy Laws.

 

Selected Dealer agrees to: (i) abide by and comply with (A) the privacy
standards and requirements of the Gramm-Leach-Bliley Act of 1999 (the “GLB
Act”), (B) the privacy standards and requirements of any other applicable
federal or state law, and (C) Selected Dealer’s own internal privacy policies
and procedures, each as may be amended from time to time; (ii) refrain from the
use or disclosure of nonpublic personal information (as defined under the GLB
Act) of all customers, except as necessary to service the customers or as
otherwise necessary or required by applicable law; and (iii) determine which
customers have opted out of the disclosure of nonpublic personal information by
periodically reviewing and, if necessary, retrieving an aggregated list of such
customers (the “List”) as provided by each to identify customers that have
exercised their opt-out rights. If either party uses or discloses nonpublic
personal information of any customer for purposes other than servicing the
customer, or as otherwise required by applicable law, that party will consult
the List to determine whether the affected customer has exercised his or her
opt-out rights. Each party understands that it is prohibited from using or
disclosing any nonpublic personal information of any customer that is identified
on the List as having opted out of such disclosures.

 

14. Anti-Money Laundering Compliance Programs.

 

Selected Dealer represents to the Dealer Manager and to the Company that it has
established and implemented anti-money laundering compliance programs in
accordance with applicable law, including applicable FINRA Conduct Rules, rules
and regulations promulgated under the Exchange Act and the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act (USA PATRIOT Act) of 2001, as amended (the “USA PATRIOT
Act”), specifically including, but not limited to, Section 352 of the
International Money Laundering Abatement and Anti-Terrorist Financing Act of
2001 (the “Money Laundering Abatement Act,” and together with the USA PATRIOT
Act, the “AML Rules”) reasonably expected to detect and cause the reporting of
suspicious transactions in connection with the offering and sale of the Shares.
Selected Dealer further represents that it currently is in compliance with all
AML Rules, specifically including, but not limited to, the Customer
Identification Program requirements under Section 326 of the Money Laundering
Abatement Act, and Selected Dealer hereby covenants to remain in compliance with
such requirements and shall, upon request by the Dealer Manager or the Company,
provide a certification to the Dealer Manager or the Company that, as of the
date of such certification (a) its AML Program is consistent with the AML Rules,
and (b) it is currently in compliance with all AML Rules, specifically
including, but not limited to, the Customer Identification Program requirements
under Section 326 of the Money Laundering Abatement Act. Upon request by the
Dealer Manager at any time, Selected Dealer will (i) furnish a written copy of
its AML Program to the Dealer Manager for review, and (ii) furnish a copy of the
findings and any remedial actions taken in connection with its most recent
independent testing of its AML Program.

 

 

 

 

15. Customer Complaints.

 

Each party hereby agrees to provide to the other party copies of any written or
otherwise documented customer complaints received by such party relating in any
way to the Offering (including, but not limited to, the manner in which the
subscriptions are offered by the Dealer Manager or Selected Dealer).

 

16. Confidentiality.

 

Dealer Manager, the Company or an affiliate or employee, agent or adviser
(“Representatives”) of the Company (all such entities and persons, collectively,
the “BDCA Senior Capital Entities”) may have provided and will furnish to
Selected Dealer or its affiliate or Representatives with certain information
that is either non-public, confidential or proprietary in nature in order to
enable Selected Dealer to perform a diligence review. This information furnished
to Selected Dealer or its affiliates or Representatives, including the terms and
conditions of any agreements entered into between Selected Dealer or its
affiliates and any BDCA Senior Capital Entity, together with analyses,
compilations, forecasts, studies or other documents prepared by Selected Dealer
or its affiliates or Representatives which contain or otherwise reflect such
information is hereinafter referred to as the “Information.” The term
“Information” shall not include such portions of the Information which (i) are
or become generally available to the public other than as a result of a
disclosure by Selected Dealer or its affiliates or Representatives in violation
of this Agreement, or (ii) become available to Selected Dealer on a
non-confidential basis from a source other than a BDCA Senior Capital Entity
that has a bona fide right to do so and which is not subject to any obligation
to keep such information confidential. In consideration of the BDCA Senior
Capital Entities furnishing Selected Dealer or its affiliates or Representatives
with the Information, Selected Dealer agrees that:

 

(a) The Information will be kept confidential and shall not, without the
Company’s prior written consent, be disseminated or disclosed by Selected Dealer
or its affiliates or Representatives, in any manner whatsoever, in whole or in
part, and shall not be used by Selected Dealer or its affiliates or
Representatives, other than in connection with performing the diligence review
contemplated in this Agreement. Moreover, Selected Dealer agrees to reveal the
Information only to such of its affiliates or Representatives who need to know
the Information for the purpose of performing the diligence review contemplated
in this Agreement, who are informed by Selected Dealer of the confidential
nature of the Information and who agree to act in accordance with the terms and
conditions of this Section 16.

 

(b) All copies of the Information will be returned to the Company or destroyed
upon the Company’s request.

 

In the event that Selected Dealer or any of its affiliates or Representatives
are requested or required (by oral questions, depositions, interrogatories,
requests for information or documents, subpoena, civil investigative demand or
other process) to disclose any of the Information, Selected Dealer will provide
the Company with prompt written notice so that any of the BDCA Senior Capital
Entities may seek a protective order, other appropriate remedy or waive
compliance with the provisions of this Agreement. In the event that such
protective order or other remedy is not obtained, or that Company waives
compliance with the provisions of this Agreement, Selected Dealer shall disclose
such Information without liability hereunder; provided, however, that Selected
Dealer will furnish only that portion of the Information which, in the opinion
of its counsel, Selected Dealer is compelled to disclose and will not oppose any
action by the Company to obtain reliable assurance that confidential treatment
will be accorded the Information. Selected Dealer further agrees to exercise its
reasonable efforts to otherwise preserve the confidentiality of the Information.
Upon reasonable notice, Selected Dealer further agrees to cooperate with the
BDCA Senior Capital Entities in obtaining a protective order or other
appropriate remedy.

 

 

 

 

(c) In no event shall any of the BDCA Senior Capital Entities be liable for any
losses, damages, claims or expenses incurred or actions undertaken by Selected
Dealer or its affiliates or Representatives as a result of their receipt of the
Information or their use thereof. Selected Dealer agrees that the Information is
and shall remain the property of the Company and that none of the BDCA Senior
Capital Entities has granted Selected Dealer or its affiliates or
Representatives any license, copyright, or similar right with respect to any of
the Information.

 

(d) Selected Dealer hereby acknowledges that Selected Dealer is aware, and that
Selected Dealer will advise its affiliates or Representatives who have been
provided with Information, that the U.S. securities laws prohibit any person who
has received from an issuer material, non-public information from purchasing or
selling securities of such issuer or from communicating such information to any
other person under circumstances in which it is reasonably foreseeable that such
person is likely to purchase or sell such securities. Selected Dealer further
acknowledges that some or all of the Information is or may be price-sensitive
information and that the use of such Information may be regulated or prohibited
by applicable legislation relating to insider dealing and Selected Dealer
undertakes, on behalf of itself and its Representatives, not to use any
Information for any unlawful purpose.

 

(e) The Company has the right to enforce this Section 16 as a third-party
beneficiary.

 

17. Miscellaneous.

 

(a) Selected Dealer hereby authorizes and ratifies the execution and delivery of
the Dealer Manager Agreement by the Dealer Manager as Dealer Manager for itself
and on behalf of all Selected Dealers (including Selected Dealer party hereto)
and authorizes the Dealer Manager to agree to any variation of its terms or
provisions and to execute and deliver any amendment, modification or supplement
thereto. Selected Dealer hereby agrees to be bound by all provisions of the
Dealer Manager Agreement relating to Selected Dealers. Selected Dealer also
authorizes the Dealer Manager to exercise, in the Dealer Manager’s discretion,
all the authority or discretion now or hereafter vested in the Dealer Manager by
the provisions of the Dealer Manager Agreement and to take all such actions as
the Dealer Manager may believe desirable in order to carry out the provisions of
the Dealer Manager Agreement and of this Agreement.

 

(b) This Agreement, except for the provisions of Sections 3, 9 and 10 – 14 and
this Section 17, may be terminated at any time by either party hereto by two
days’ prior written notice to the other party and, in all events, this Agreement
shall terminate on the termination date of the Dealer Manager Agreement, except
for the provisions of Sections 3, 9, 10 – 14 and this Section 17.

 

Any communications from Selected Dealer should be in writing addressed to the
Dealer Manager at:

 

Realty Capital Securities, LLC
One Beacon Street, 14th Floor
Boston, Massachusetts 02108
Facsimile No.: (857) 207-3399
Attention: Louisa Quarto, President

 

with a copy to:

 

Alston & Bird LLP

One Atlantic Center

1201 West Peachtree Street
Atlanta, GA 30309-3424
Attn: Rosemarie A. Thurston

 

Any notice from the Dealer Manager to Selected Dealer shall be deemed to have
been duly given if mailed, communicated by electronic delivery or facsimile or
delivered by overnight courier to Selected Dealer at Selected Dealer’s address
provided on the signature page of this Agreement.

 

 

 

 

(c) Nothing herein contained shall constitute the Dealer Manager, Selected
Dealer, the other Selected Dealers or any of them as an association,
partnership, limited liability company, unincorporated business or other
separate entity.

 

(d) If this Agreement is executed before the initial Effective Date, then the
Dealer Manager will notify Selected Dealer in writing when the initial Effective
Date has occurred. Selected Dealer agrees that Selected Dealer will not make any
offers to sell the Shares or solicit purchasers for the Shares until Selected
Dealer has received such written notice of the initial Effective Date from the
Dealer Manager or the Company. This Agreement shall be effective for all sales
by Selected Dealer on and after the initial Effective Date.

 

(e) The Company may authorize the Company’s transfer agent to provide
information to the Dealer Manager and Selected Dealer regarding record holder
information about the clients of Selected Dealer who have invested with the
Company on an ongoing basis for so long as Selected Dealer has a relationship
with such client. Selected Dealer shall not disclose any password for a
restricted website or portion of a website provided to Selected Dealer in
connection with the Offering and shall not disclose to any person, other than an
officer, director, employee or agent of Selected Dealer, any material downloaded
from such restricted website or portion of a restricted website.

 

(f) Selected Dealer shall have no right to assign this Agreement or any of its
rights hereunder or to delegate any of its obligations. Any purported assignment
or delegation by Selected Dealer shall be null and void. The Dealer Manager
shall have the right to assign any or all of its rights and obligations under
this Agreement by written notice, and Selected Dealer shall be deemed to have
consented to such assignment by execution hereof. The Dealer Manager shall
provide written notice of any such assignment to Selected Dealer.

 

(g) This Agreement may be executed (including by facsimile transmission) with
counterpart signature pages or in counterpart copies, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument comprising this Agreement.

 

The invalidity or unenforceability of any provision of this Agreement shall not
affect the
other provisions hereof, and this Agreement shall be construed in all respects
as if such invalid or unenforceable provision were omitted.

 

(i) The failure of any party to insist upon or enforce strict performance by any
other party of
any provision of this Agreement or to exercise any right under this Agreement
shall not be construed as a waiver or relinquishment to any extent of such
party’s right to assert or rely upon any such provision or right in that or any
other instance; rather, such provision or right shall be and remain in full
force and effect.

 

 

 

 

If the foregoing is in accordance with Selected Dealer’s understanding and
agreement, please sign and return the attached duplicate of this Agreement.
Selected Dealer’s indicated acceptance thereof shall constitute a binding
agreement between Selected Dealer and the Dealer Manager.

 

Very truly yours,

 

REALTY CAPITAL SECURITIES, LLC

 

By: /s/ Lousia Quarto

Name: Louisa Quarto

Title: President

, 2014

 

The undersigned dealer confirms its agreement to act as a Selected Dealer
pursuant to all the terms and conditions of the above Selected Dealer Agreement
and the attached Dealer Manager Agreement. The undersigned dealer hereby
represents that it will comply with the applicable requirements of the
Securities Act and the Exchange Act and the published rules and regulations of
the Commission thereunder, and applicable blue sky or other state securities
laws. The undersigned dealer represents and warrants that the undersigned dealer
is duly registered as a broker-dealer under the provisions of the Exchange Act
and the Exchange Act Rules and Regulations or is exempt from such registration.
The undersigned dealer confirms that it and each salesperson acting on its
behalf are members in good standing of FINRA and duly licensed by each
regulatory authority in each jurisdiction in which the undersigned dealer or
such salesperson will offer and sell Shares, or are exempt from registration
with such authorities. The undersigned dealer hereby represents that it will
comply with all rules and regulations promulgated by FINRA.

 

Dated:_________ , 2014

 

Name of Selected Dealer

 

Federal Identification Number

 

By:______________________________________

Name:
Title:

 

Kindly have checks representing commissions forwarded as follows (if different
than above): (Please type or print.)

 

Name of Firm:
Address:

 

Street

 

City

State and Zip Code

 

(Area Code) Telephone No.

 

Attention: _____________________________

 

 

 

 

SCHEDULE 1
TO

SELECTED DEALER AGREEMENT

 

Selected Dealer represents and warrants that it is currently licensed as a
broker-dealer in the following jurisdictions:

 

q Alabama q Montana     q Alaska q Nebraska     q Arizona q Nevada     q
Arkansas q New Hampshire     q California q New Jersey     q Colorado q New
Mexico     q Connecticut q New York    

q Delaware

q North Carolina     q District of Columbia q North Dakota     q Florida q Ohio
    q Georgia q Oklahoma     q Guam q Oregon     q Hawaii q Pennsylvania     q
Idaho q Puerto Rico     q Illinois q Rhode Island     q Indiana q South Carolina
    q Iowa q South Dakota     q Kansas q Tennessee     q Kentucky q Texas     q
Louisiana q Utah     q Maine q Vermont     q Maryland q U.S Virgin Islands     q
Massachusetts q Virginia     q Michigan q Washington     q Minnesota q West
Virginia     q Mississippi q Wisconsin     q Missouri q Wyoming