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EXHIBIT 10.3
CORPORATE PROPERTY ASSOCIATES 17 - GLOBAL INCORPORATED
50 ROCKEFELLER PLAZA
NEW YORK, NY 10020
SALES AGENCY AGREEMENT
November 30, 2007
Carey Financial, LLC
50 Rockefeller Plaza
New York, NY 10020
Ladies and Gentlemen:
Corporate Property Associates 17 - Global Incorporated, a Maryland
corporation
(the "Company"), hereby confirms its agreement with you as
follows:
1.
Introduction. This Sales Agency Agreement (the "Agreement") sets
forth
the understandings and agreements between the Company and you
whereby you will
offer and sell on a best efforts basis for the account and risk of
the Company,
along with a group of Selected Dealers (as defined in Section 3(c)
below) to be
formed with your assistance, up to 250,000,000 shares of common
stock, par value
$0.001 per share (each a "Share," and collectively, the "Shares")
of the
Company, of which 50,000,000 Shares are being offered pursuant to
the Company's
Distribution Reinvestment and Stock Purchase Plan (the "DRIP"),
registered on
Form S-11. Shares sold to the public other than through the DRIP
shall be sold
at $10 per share (subject to certain volume discounts) and shares
sold through
the DRIP shall be sold at $9.50 per share (the "Offering"). The
Shares are more
fully described in the Registration Statement referred to
below.
2. Representations and
Warranties of the Company.
The Company represents, warrants and agrees that:
(a) Registration Statement and Prospectus. The Company has filed
with
the
Securities and Exchange Commission (the "Commission") a
registration
statement on Form S-11 (File No. 333-140842), for the registration
of the
Shares under the Securities Act of 1933, as amended (the
"Securities Act")
and
the regulations thereunder (the "Regulations"). The
registration
statement, as amended, (including financial statements, exhibits
and all
other documents related thereto filed as a part thereof or
incorporated
therein), and any registration statement filed under Rule 462(b) of
the
Securities Act, are herein called the "Registration Statement" and
the
prospectus contained therein is called the "Prospectus,"
respectively,
except that if the Registration Statement is amended by a
post-effective
amendment, the term "Registration Statement" shall, from and after
the
declaration of effectiveness of such post-effective amendment,
refer to the
Registration Statement as so amended and the term "Prospectus"
shall refer
to
the Prospectus as so amended, and if the Prospectus filed by the
Company
pursuant to Rule 424(b) or 424(c) of the Regulations shall differ
from the
Prospectus on file at the time the Registration Statement or
any
post-effective amendment shall become effective, the term
"Prospectus"
shall refer to the Prospectus filed pursuant to either of such
Rules from
and
after the date on which it shall have been filed with the
Commission.
Further, if a separate prospectus is filed and becomes effective
with
respect solely to the
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DRIP
(a "DRIP Prospectus"), the term "Prospectus" shall refer to such
DRIP
Prospectus from and after the declaration of effectiveness of such
DRIP
Prospectus.
(b) Compliance with the Securities Act. The Registration Statement
has
been
prepared and filed by the Company and has been declared effective
by
the
Commission. Neither the Commission nor any state securities
authority
has
issued any order preventing or suspending the use of any
Prospectus
filed with the Registration Statement or any amendments or
supplements
thereto and no proceeding for that purpose has been instituted, or
to the
Company's knowledge, is threatened or contemplated by the
Commission or by
the
states securities authorities. At the time the Registration
Statement
became effective (the "Effective Date") and at the time that
any
post-effective amendments thereto or any additional registration
statement
filed under Rule 462(b) of the Securities Act becomes effective,
the
Registration Statement or any amendment thereto (1) complied, or
will
comply, as to form in all material respects with the requirements
of the
Securities Act and the Regulations and (2) did not or will not
contain an
untrue statement of a material fact or omit to state a material
fact
necessary to make the statements therein not misleading. When
the
Prospectus or any amendment or supplement thereto is filed with
the
Commission pursuant to Rule 424(b) or 424(c) of the Regulations and
at all
times subsequent thereto through the date on which the Offering
is
terminated ("Termination Date"), the Prospectus (as amended or
as
supplemented) will comply in all material respects with the
requirements of
the
Securities Act and the Regulations, and will not include any
untrue
statement of a material fact or omit to state a material fact
required to
be
stated therein or necessary to make the statements therein, in the
light
of
the circumstances under which they were made, not misleading.
(c) The Company. The Company has been duly incorporated and
validly
exists as a corporation in good standing under the laws of the
State of
Maryland with full power and authority to conduct the business in
which it
is engaged in as
described in the Prospectus. The Company is duly qualified
to
do business as a foreign corporation and is in good standing in
each
other jurisdiction in which it owns or leases property of a nature,
or
transacts business of a type that would make such qualification
necessary
except where the failure to be so qualified or in good standing
could not
have, individually or in the aggregate, a material adverse effect
on the
financial condition, stockholders' equity, results of operation or
business
of
the Company, taken as a whole (a "Material Adverse Effect").
(d) The Shares. The Shares, when issued, will be duly and
validly
issued, fully paid and non-assessable and will conform in all
material
respects to the description thereof contained in the Prospectus; no
holder
thereof will be subject to personal liability for the obligations
of the
Company solely by reason of being such a holder; such Shares are
not
subject to the preemptive rights of any shareholder of the Company;
and all
corporate action required to be taken for the authorization, issue
and sale
of
such Shares has been validly and sufficiently taken.
(e) Violations. The Company is not in violation of its Articles
of
Incorporation ("Articles") or Bylaws or in default in the
performance or
observance of any material obligation, agreement, covenant or
condition
contained in any contract, indenture, mortgage, loan agreement,
note, lease
or
other agreement or instrument to which it is a party or by which it
or
any
of its properties is bound.
(f) Taxes. The Company has filed all federal, state and foreign
income
tax
returns which have been required to be filed on or before the due
date
(taking into account all extensions of time to file). The Company
has paid
or
provided for the payment of all taxes indicated by said returns and
all
assessments received by the Company to the extent that such taxes
or
assessment have become due, except where the Company is contesting
such
assessments in good faith and except for such taxes and assessments
of
immaterial amounts, the failure of which to pay, would not,
individually or
in
the aggregate, reasonably be expected to have a Material Adverse
Effect.
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(g) Pending Action. Except as disclosed in the Registration
Statement
and
the Prospectus, there is no action, suit or proceeding pending or,
to
the
best of the knowledge, information and belief of the Company,
threatened to which the Company is a party, before or by any court
or
governmental agency or body which would reasonably be expected to
have a
Material Adverse Effect.
(h) Financial Statements. The financial statements of the
Company,
including the notes thereto, filed as part of the Registration
Statement
and
those included in the Prospectus present fairly in all material
respects the financial position of the Company as of the date
indicated and
the
results of its operations for the periods specified; said
financial
statements have been prepared in conformity with generally
accepted
accounting principles applied on a consistent basis and comply with
the
requirements of Regulation S-X promulgated by the Commission;
and
PricewaterhouseCoopers LLP, whose report is filed with the
Commission as a
part
of the Registration Statement, are independent accountants as
required
by
the Securities Act and the Regulations.
(i) No Subsequent Material Events. Since the respective dates as
of
which information is given in the Registration Statement and
the
Prospectus, except as may otherwise be stated in or contemplated by
the
Registration Statement and the Prospectus, (a) there has not been
any
material adverse change in the condition (financial or otherwise)
of the
Company or in the earnings, affairs or business prospects of the
Company,
whether or not arising in the ordinary course of business, and (b)
there
have
not been any material transactions entered into by the Company
except
in
the ordinary course of business.
(j) Investment Company Act. The Company does not intend to conduct
its
business so as to be an "investment company" as that term is
defined in the
Investment Company Act of 1940, as amended and the rules and
regulations
thereunder, and it will exercise reasonable diligence to ensure
that it
does
not become an "investment company" within the meaning of the
Investment Company Act of 1940.
(k) Authorization of Agreement. This Agreement and the Advisory
Agreement (the "Advisory Agreement") among the Company, Carey
Asset
Management Corp. (the "Advisor") and CPA(R):17 Limited Partnership
have
been
duly and validly authorized, executed and delivered by the Company
and
CPA(R):17 Limited Partnership and constitute the valid agreements
of the
Company and CPA(R):17
Limited Partnership enforceable in accordance with
their terms. The execution and delivery of this Agreement and the
Advisory
Agreement, the consummation of the transactions herein and
therein
contemplated and the compliance with the terms of this Agreement
and the
Advisory Agreement by the Company and CPA(R):17 Limited Partnership
will
not
conflict with or constitute a default under (1) the Articles or
bylaws
of
the Company or the Operating Partnership Agreement of CPA(R):17
Limited
Partnership or (2) any indenture, mortgage, deed of trust, lease or
other
agreement or instrument to which the Company is a party, or (3) any
law,
order, rule or regulation, writ, injunction or decree of any
government,
governmental instrumentality or court, domestic or foreign,
having
jurisdiction over the Company, or any of its property, except in
the case
of
clauses (2) and (3), where such conflict, breach, violation or
default
would not reasonably be expected to have individually or in the
aggregate,
a
Material Adverse Effect and except to the extent that the
enforceability
of
the indemnity and/or contribution provisions contained in Section 8
of
this
Agreement may be limited under applicable securities law; and
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 the Advisory Agreement by the Company, or
CPA(R):17
Limited Partnership, or for the consummation of the
transactions
contemplated hereby and thereby (except such as have been obtained
under
the
Securities Act or as may be required under state securities or
"blue
sky"
laws in connection with the distribution of the Shares).
3
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(l) Description of Agreements. The Company is not a party to or
bound
by
any contract or other instrument of a character required to be
described
in
the Registration Statement or the Prospectus or to be filed as
an
exhibit to the Registration Statement that is not described and
filed as
required.
(m) Qualification as a Real Estate Investment Trust. The
Company
intends to satisfy the requirements of the Internal Revenue Code of
1986 as
amended (the "Code") for qualification of the Company as a real
estate
investment trust. Commencing with the taxable year ending December
31,
2007, the Company has been organized and has operated in conformity
with
the
requirements for qualification as a real estate investment trust
under
the
Code and its actual method of operation has enabled it and its
proposed
method of operation as described in the Prospectus will enable it
to
continue to meet the requirements for taxation as a real estate
investment
trust under the Code.
3.
Sales of Shares. On the basis of the representations, warranties
and
covenants herein contained, but subject to the terms and conditions
herein set
forth, the Company hereby appoints you as its sales agent ("Sales
Agent") to
solicit purchasers, along with the Selected Dealers, for the Shares
during the
period (the "Effective Term") from the Effective Date to the
Termination Date,
including the Shares pursuant to the DRIP, each in the manner
described in the
Registration Statement. Subject to the performance by the Company
of all
obligations to be performed by it hereunder and the completeness
and accuracy of
all of its representations and warranties, you agree to use your
best efforts as
Sales Agent, promptly following written or telegraphic receipt of
notice of the
Effective Date from the Company, to offer and sell such number of
Shares as
contemplated by this Agreement at the price stated in the
Prospectus.
(a) Purchase of Shares. The purchase of Shares must be made during
the
offering period described in the Prospectus, or after such offering
period
in
the case of purchases made pursuant to the DRIP (each such
purchase
hereinafter defined as an "Order"). Persons desiring to purchase
Shares are
required to (i) deliver to you or the appropriate Selected Dealer a
check
in
the amount of $10 per Share purchased (subject to certain
volume
discounts or other discounts
as described in the Prospectus) payable to
Wells Fargo Bank, N. A., until subscription proceeds reach $10
million and
thereafter to the Bank of the West (each of such Wells Fargo Bank,
N.A. and
the
Bank of the West being an "Agent Bank"), or (ii) authorize a debit
of
such
amount to the account such purchaser maintains with you, the
appropriate Selected Dealer. During the Offering and until the
first
valuation of the Company's assets is completed, Shares issued
pursuant to
the
DRIP shall be purchased at $9.50 per share. Subsequent to the
first
annual valuation of the Company's assets, the price of shares
purchased
pursuant to the DRIP will be 95% of the then-current net asset
value. For
investors residing in certain states, an order form in the form
attached to
the
Prospectus (each an "Order Form") must be completed and submitted
to
the
Company. On a daily basis, you will submit all checks received
from
investors and transfer, via Federal Reserve bank wire, the total
amount
debited from investor accounts for the purchase of Shares along
with a list
including the name, address and telephone number of, the social
security
number or taxpayer identification number of, the brokerage account
number
of
(if applicable), the number of Shares purchased by, any election
to
participate in the DRIP by, and the total dollar amount of
investment by,
each
investor on whose behalf checks are submitted or the wire transfer
is
made. You also will forward all Order Forms to the Company. You
shall use
your
best efforts to wire such funds or transmit checks to the
applicable
Agent Bank not later than noon of the next business day after
receipt by
you
from your customer of each Order. You will advise the applicable
Agent
Bank
whether the funds you are submitting are attributable to
individual
retirement accounts, Keogh plans, or any other employee benefit
plan
subject to Title I of the Employee Retirement Income Security Act
of 1974
or
from some other type of investor.
All
Orders solicited by you will be strictly subject to review and
acceptance by the Company and the Company reserves the right in
its
absolute discretion to reject any Order or to accept or reject
Orders in
the
order of their receipt by the Company or otherwise. Within 30 days
of
receipt of an Order, the
4
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Company must accept or reject such Order. If the Company elects to
reject
such
Order, within 10 business days after such rejection, it will
notify
the
purchaser of such fact and cause the return of such purchaser's
funds
submitted with such application and any interest earned thereon. If
you
receive no notice of rejection within the foregoing time limits or
if funds
submitted by the purchaser are released from escrow to the Company
within
the
foregoing time limits, the Order shall be deemed accepted. You
agree to
make
every reasonable effort to determine that the purchase of Shares is
a
suitable and appropriate investment for each potential purchaser of
Shares
based on information provided by such purchaser regarding such
purchaser's
financial situation
and investment objectives. You agree to maintain copies
of
the Orders received from investors.
(b) Closing Dates and Delivery of Shares. In no event shall a sale
of
Shares to an investor be completed until at least five business
days after
the
date the investor receives a copy of the Prospectus. On the date
Shares
are
first issued to shareholders (such date being herein referred to as
the
"Initial Closing Date"), the applicable Agent Bank will at such
time and
place as instructed by you and the Company (which instruction shall
be
subject to the satisfaction on such date of the conditions
contained
herein), deliver to the Company or its designee immediately
available funds
in
an amount equal to the escrow funds maintained by the Company and
on
deposit in the escrow account of the applicable Agent Bank prior to
the
date
designated by the Company. If, after the Initial Closing Date,
additional sales of Shares are made, on each such date (each such
date
being referred to as an "Additional Closing Date") and at each such
time
and
place as instructed by you and the Company (which instruction shall
be
subject to the satisfaction on each such date of the conditions
contained
herein), the applicable Agent Bank shall be required to deliver to
the
Company or its designee immediately available funds in an amount
equal to
the
escrow funds on deposit in the escrow account of the applicable
Agent
Bank
prior to the date specified by the Company. The Initial Closing
Date
and
each Additional Closing Date are each herein referred to as a
"Closing
Date." Closing dates for purchases made pursuant to the DRIP will
be as set
forth in the DRIP.
(c) Selected Dealers. The Shares offered and sold under this
Agreement, other than sales made by the Company directly to its
officers
and
directors, shall be offered and sold only by you as Sales Agent and
by
a
selling group of brokers or dealers (the "Selected Dealers"), all
of whom
must
be members in good standing of the Financial Industry
Regulatory
Authority (the "FINRA"), who execute Selected Dealer Agreements
with you
substantially in the form attached hereto as Exhibit A, all of whom
are
acceptable to the Company and you (which acceptance shall not
be
unreasonably withheld by you). You will assist the Company in
forming the
selling group of Selected Dealers. No firm shall be invited to join
the
selling group of
Selected Dealers if it is (i) currently subject to any
suspension or expulsion pursuant to the rules and regulations of
the
Commission, the state securities commissions of any of the fifty
states,
the
New York Stock Exchange, Inc. or the American Stock Exchange, Inc.
as
those rules and regulations relate to broker-dealers, or the rules
and
regulations of the FINRA or (ii) a "discount broker" as that term
is
commonly understood in the brokerage industry. The Company and the
Advisor
or
an affiliate thereof agree to participate in your marketing efforts
to
the
extent that you may reasonably request and, without limiting
the
generality of the foregoing, agree to visit the offices of Selected
Dealers
as
you may reasonably designate.
(d) Compensation. In consideration for your execution of this
Agreement, and for the performance of your obligations hereunder,
the
Company agrees to pay or cause to be paid to you a selling
commission (the
"Selling Commission") of six and one-half percent ($0.65) of the
price of
each
Share (except for Shares sold pursuant to the DRIP, as to which
no
Selling Commissions shall be paid) sold by you or by a Selected
Dealer;
provided, however, that your Selling Commission shall be reduced
with
respect to volume sales of Shares to single purchasers (as defined
in the
Prospectus). In the case of such volume sales to single purchasers,
on
orders of $250,000 or more your Selling Commission shall be reduced
by the
amount of the Share purchase price discount. In the case of such
volume
sales to single
5
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purchasers, your Selling Commission will be reduced for each
incremental
share purchase in the total volume ranges set forth in the table
below.
Such
reduced share price will not affect the amount received by the
Company
for
investment. The following table sets forth the reduced Share
purchase
price and Selling
Commission payable to you:
<TABLE>
<CAPTION>
PURCHASE PRICE PER SHARE FOR SELLING COMMISSION PER
SHARE
VOLUME DISCOUNT RANGE FOR A INCREMENTAL SHARE IN
VOLUME ON
TOTAL SALE FOR INCREMENTAL
SINGLE PURCHASER
DISCOUNT RANGE
SHARE IN VOLUME DISCOUNT RANGE
--------------------------- ----------------------------
------------------------------
<S>
<C>
<C>
$ 2000 - $250,000
$10.00
$0.65
$250,001 - $500,000
$ 9.85
$0.50
$500,001 - $750,000
$ 9.70
$0.35
$750,001 - $1,000,000
$ 9.60
$0.25
$1,000,001- $5,000,000
$ 9.50
$0.15
</TABLE>
As
an example, a single purchaser would receive 50,380.7107 Shares
rather
than 50,000 Shares for his/her or its investment of $500,000 and
the Selling
Commission would be $28,940. On the first $250,000 of the
investment there would
be no discount and the purchaser would receive 25,000 Shares at $10
per share.
On the remaining $250,000, the per share price would be $9.85 and
the purchaser
would receive 25,380.7107 Shares.
Selling Commissions for purchases of $5,000,000 or more are
negotiable but
in no event will the proceeds to the Company be less than $9.35 per
Share.
Selling Commissions paid will in all cases be the same for the same
level of
sales.
The
Company will pay to you for reallowance to Selected Dealers only,
the
amount of any due diligence expense reimbursement paid to the
Selected Dealers
which you have agreed to pay in the amount of up to one-half
percent of the
total proceeds received by the Company from Shares sold by each
Selected Dealer
to which you have agreed to make such reimbursement.
From
your total Selling Commissions, you agree to reallow to each
Selected
Dealer with whom you have entered into a Selected Dealer Agreement
the full
$0.65 Selling Commission per Share for Shares sold by the Company
pursuant to
Orders solicited by such Selected Dealer and up to the full amount
of the $0.20
per Share Selected Dealer Fee (as defined in the Selected Dealer
Agreement) paid
to you by the Company with respect to Shares solicited by the
Selected Dealer.
The Company will pay to you a Wholesaling Fee of $0.15 per Share
sold. This fee
is intended to cover your wholesaling expenses. No Selling
Commissions, Selected
Dealer Fees or Wholesaling Fees will be paid in connection with
purchases of
Shares made through the DRIP.
No
payment of Selling Commissions will be made by the Company with
respect
to Orders (or portions thereof), which are rejected by the Company.
In addition,
we will not pay you a Selected Dealer Fee if the aggregate
underwriting
compensation to be paid to us, you and the other Selected Dealers
in connection
with the Offering and sale of the Shares (including such Selected
Dealer Fee)
exceed the limitations prescribed by the FINRA. Selling
Commissions, Selected
Dealer Fees and Wholesaling Fees will be paid within five business
days
following any Closing Date with respect to the Shares sold to
purchasers whose
Shares are issued on such Closing Date. Selling Commissions,
Selected Dealer
Fees and Wholesaling Fees will be payable only with respect to
transactions
lawful in the jurisdictions where t
