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SALES AGREEMENT | Document Parties: SUN COMMUNITIES INC | Brinson Patrick Securities Corporation | Sun Communities, Inc You are currently viewing:
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SUN COMMUNITIES INC | Brinson Patrick Securities Corporation | Sun Communities, Inc

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Title: SALES AGREEMENT
Governing Law: New York     Date: 8/27/2009
Industry: Real Estate Operations     Law Firm: Ober Kaler     Sector: Services

This Sale and Purchase Contract is an actual legal document drafted by a top law firm for their client.
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Sun Communities, Inc.

 

 

DOCS ® Financing Facility

 

 

Shares of Common Stock, $.01 par value

 

 

 

 

 

SALES AGREEMENT

 

 

 

 

August 27, 2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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*DOCS® is a registered service mark of Brinson Patrick Securities Corporation.

 

 

 

 

 

 

 


 

 

THIS SALES AGREEMENT (this “Agreement”) dated as of August 27, 2009 between Brinson Patrick Securities Corporation, having its principal office at 1515 Broadway, 11 th Floor, New York, New York, 10036 (the “Sales Manager”) and Sun Communities, Inc., a corporation organized and existing under the laws of the State of Maryland (the “Company”).

 

WHEREAS , the Company desires to issue and sell through the Sales Manager shares of its common stock, par value $.01 per share (such shares referred to herein as the “Common Stock”), on the terms set forth in Article II hereof.

 

IN CONSIDERATION of the mutual covenants contained in this Agreement, the Company and the Sales Manager agree as follows:

 

ARTICLE I

 

 

REPRESENTATIONS AND WARRANTIES

OF THE COMPANY

 

1.1   For purposes of this Agreement, unless the context requires to the contrary, the term “Company” shall also include all significant subsidiaries (as defined in Section 1-02 of Regulation S-X) of the Company.  The Company represents and warrants to, and agrees with, the Sales Manager that:

 

(a)   The Company meets the requirements for use of Form S-3 under the Securities Act of 1933, as amended (the “Act”), and the rules and regulations thereunder (“Rules and Regulations”), and the Company is eligible to use Form S-3 for the transactions contemplated by this Agreement.  A.  registration statement on Form S-3 (No. 333-158623) with respect to, among other securities, the Common Stock has been prepared by the Company in conformity with the requirements of the Act and the Rules and Regulations, has been filed with the Securities and Exchange Commission (the “Commission”) and has been declared effective by the Commission.  No stop order suspending the effectiveness of such registration statement has been issued, and no proceeding for that purpose has been instituted or, to the knowledge of the Company, threatened by the Commission.  Additionally, the Company has filed a Prospectus Supplement naming the Sales Manager as sales manager and setting forth certain information regarding the sales to be made through the Sales Manager.  Each such registration statement, as it may have heretofore been or (only to the extent (i) filed and declared effective by the Commission after the date hereof and (ii) a prospectus supplement forming a part of such registration statement and relating to the Common Stock to be offered and sold pursuant to this Agreement having been filed pursuant to Rule 424 under the Act) may hereafter be filed, as amended, is referred to herein as the “Registration Statement,” and the final form of prospectus included in the Registration Statement, as amended or supplemented from time to time relating to the Common Stock, is referred to herein as the “Prospectus.”  Any reference herein to the Registration Statement, the Prospectus, or any amendment or supplement thereto shall be deemed to refer to and include the documents incorporated (or deemed to be incorporated) by reference therein, and any reference herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement or Prospectus shall be deemed to refer to and include the filing after the execution hereof of any document with the Commission deemed to be incorporated by reference therein.

 

(b)   Each part of the Registration Statement, when such part became or becomes effective, and the Prospectus and any amendment or supplement thereto, on the date of filing thereof with the Commission and at each Settlement Date (as hereinafter defined), conformed or will conform in all material respects with the requirements of the Act and the Rules and Regulations; each part of the Registration Statement, when such part became or becomes effective, did not or will not contain an 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 not misleading; and the Prospectus and any amendment or supplement thereto, on the date of filing thereof with the Commission and at each Settlement Date, did not or will not include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; except that the foregoing shall not apply to statements in or omissions from any such document in reliance upon, and in conformity with, written information furnished to the Company by or on behalf of the Sales Manager, specifically for use in the Registration Statement, the Prospectus or any amendment or supplement thereto.

 

 

 

 


 

 

(c)   The documents incorporated by reference in the Registration Statement or the Prospectus, or any amendment or supplement thereto, when they became or become effective under the Act or were or are filed with the Commission under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as the case may be, conformed or will conform in all material respects with the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder.

 

(d)   The financial statements of the Company, together with the related schedules and notes thereto, set forth or included or incorporated by reference in the Registration Statement and Prospectus, fairly present the financial condition of the Company as of the dates indicated and the results of operations, changes in financial position, stockholders’ equity, and cash flows for the periods therein specified, in conformity with generally accepted accounting principles consistently applied throughout the periods involved (except as otherwise stated therein).  The summary and selected financial and statistical data included or incorporated by reference in the Registration Statement and the Prospectus fairly present the information shown therein and, to the extent based upon or derived from the financial statements, have been compiled on a basis consistent with the financial statements presented therein.  In addition, any pro forma financial statements of the Company, and the related notes thereto, included or incorporated by reference in the Registration Statement and the Prospectus, present fairly the information shown therein, have been prepared in accordance with the Commission’s rules and guidelines with respect to pro forma financial statements and have been properly compiled on the basis described therein, and the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred to therein.  Furthermore, all financial statements required by Rule 3-14 of Regulation S-X (“Rule 3-14”), if any, have been included or incorporated by reference in the Registration Statement and the Prospectus and any such financial statements are in conformity with the requirements of Rule 3-14.  No other financial statements are required to be set forth or incorporated by reference in the Registration Statement or the Prospectus under the Rules and the Regulations.

 

(e)   Grant Thornton LLP, which has expressed their opinion with respect to the financial statements and the supporting schedules included or incorporated by reference in the Registration Statement are and, during the periods covered by their reports, were independent registered public accounting firm with respect to the Company within the meaning of the Act and the applicable rules and regulations thereunder adopted by the Commission and the Public Company Accounting Oversight Board (United States).

 

 

 

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(f)   The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Maryland.  Other than as disclosed in the Registration Statement, the Company has no subsidiaries and does not control, directly or indirectly, any corporation, partnership, limited liability company, joint venture, association or other business organization.  The Company is duly qualified and in good standing as a foreign corporation in each jurisdiction in which the character or location of its assets or properties (owned, leased or licensed) or the nature of its business makes such qualification necessary (including every jurisdiction in which it owns or leases property), except for such jurisdictions where the failure to so qualify would not have a Material Adverse Effect on the Company.  For purposes of this Agreement, “Material Adverse Effect” means any adverse effect on the business, operations, prospects, properties or financial condition of the Company that is (either alone or together with all other adverse effects) material to the Company and its subsidiaries, taken as a whole, and any material adverse effect on the issuance and sale of Common Stock by the Company contemplated under this Agreement.  Each of the Company’s subsidiaries is validly existing as a corporation, limited liability company or partnership, as applicable, in its respective jurisdiction of formation, except where failure to maintain such existence would not have a Material Adverse Effect.  Schedule 1.1(f) hereto identifies each of the Company’s subsidiaries that is a significant subsidiary (as defined in Section 1-02 of Regulation S-X) of the Company (each, a “Significant Subsidiary”).  All of the issued and outstanding capital stock, limited liability company interests or partnership interests, as applicable, of each Significant Subsidiary has been duly authorized and validly issued, and, if applicable, is fully paid and nonassessable and (except as otherwise disclosed or incorporated by reference in the Registration Statement and the Prospectus) is owned by the Company, directly, free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or equity.  Except as disclosed or incorporated by reference in the Registration Statement and the Prospectus, the Company does not own, lease or license any material asset or property or conduct any business outside the United States of America.  The Company and each of its Significant Subsidiaries has all requisite corporate, partnership or limited liability company power and authority, as applicable, and all necessary authorizations, approvals, consents, orders, licenses, certificates and permits of and from all governmental orders or regulatory bodies or any other person or entity, to own, lease, license and operate its assets and properties and conduct its business as now being conducted and as described or incorporated by reference in the Registration Statement and the Prospectus; except for such authorizations, approvals, consents, orders, licenses, certificates and permits the absence of which would not have a Material Adverse Effect; and no such authorization, approval, consent, order, license, certificate or permit contains a materially burdensome restriction other than as disclosed or incorporated by reference in the Registration Statement and the Prospectus.

 

(g)   The Company is the sole general partner of Sun Communities Operating Limited Partnership (the “Operating Partnership”) and such general partner interest is duly authorized by the Agreement of Limited Partnership of the Operating Partnership dated April 30, 1996, as may be amended or restated from time to time (the “Partnership Agreement”) and was validly issued to the Company; and the Company owns such general partner interest free and clear of all liens, encumbrances, security interests, equities, charges or claims (except for such liens, encumbrances, security interests, equities, charges or claims as are not, individually or in the aggregate, material to such ownership or as described in the Registration Statement or the Prospectus).

 

(h)   The Operating Partnership owns 100% of the outstanding capital stock of Sun Home Services, Inc. (“Home Services”).

 

(i)   Home Services is a corporation duly organized, validly existing and in good standing under the laws of the State of Michigan.  Home Services is duly licensed or qualified to do business and is in good standing as a foreign corporation in all jurisdictions in which the nature of the activities conducted by it or the character of the assets owned or leased by it makes such licensing or qualification necessary (except where the failure to be so licensed or qualified would not have a Material Adverse Effect on the Company or Home Services, or subject the Company or the shareholders of the Company to any material liability or disability).

 

 

 

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(j)   The Operating Partnership is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Michigan.  The Operating Partnership is duly licensed or qualified to do business and is in good standing as a foreign limited partnership in all jurisdictions in which the nature of the activities conducted by it or the character of the assets owned or leased by it makes such licensing or qualification necessary (except where the failure to be so licensed or qualified would not have a Material Adverse Effect on the Company or the Operating Partnership, or subject the Company or the shareholders of the Company to any material liability or disability).

 

(k)   The Company has good title to each of the items of personal property which are reflected in the financial statements referred to in Section 1.1(d) or are referred to in the Registration Statement and the Prospectus or any document incorporated by reference therein as being owned by the Company and valid and enforceable leasehold interests in each of the items of real and personal property which are referred to in the Registration Statement and the Prospectus or any document incorporated by reference therein as being leased by the Company, in each case free and clear of all liens, encumbrances, claims, security interests and defects, other than those described in the Registration Statement and the Prospectus and those which do not and will not have a Material Adverse Effect.

 

(l)   The Company has been subject to the requirements of Section 12 of the Exchange Act during the period commencing 36 months preceding the filing of the Registration Statement and ending on the date hereof (the “Reporting Period”) and during such Reporting Period the Company has timely filed all material required to be filed pursuant to Sections 13(a), 14 and/or 15(d) of the Exchange Act.  All such material conformed in form and substance in all material respects to the requirements of the Exchange Act and the rules and regulations thereunder.  As of the date of the initial filing of the Registration Statement on April 17, 2009, and as of the date hereof, the aggregate market value of the voting and non-voting common equity held by non-affiliates of the Company was and is at least $150 million.

 

(m)   The Company has good and marketable title to, or leasehold interests in, all properties and assets (including, without limitation, mortgaged assets) as described in the Registration Statement and the Prospectus or any document incorporated by reference therein, owned by the Company, free and clear of all liens, charges, encumbrances or restrictions, except such as are described in the Registration Statement and the Prospectus or any document incorporated by reference therein.  The Company has such consents, easements, rights-of-way or licenses (collectively, “rights-of-way”) from any person as are necessary to conduct its business in the manner described in the Registration Statement, except for those which if not obtained would not, singly or in the aggregate, have a Material Adverse Effect on the Company, and none of such rights-of-way contains any restriction that is materially burdensome to the Company.

 

(n)   There is no litigation or governmental or other proceeding or investigation before any court or before or by any public body or board pending or, to the knowledge of the Company, threatened (and the Company does not know of any basis therefor) against, or involving the assets, properties or businesses of the Company which would materially adversely affect the value or the operation of any such assets or otherwise have a Material Adverse Effect on the Company and its subsidiaries, as a whole, except as described or incorporated by reference in the Registration Statement.

 

(o)   The Company maintains insurance (issued by insurers of recognized financial responsibility) of the types and in the amounts generally deemed adequate for its businesses and, to the knowledge of the Company, consistent with insurance coverage maintained by similar companies in similar businesses, including, but not limited to, insurance covering real and personal property owned or leased by the Company against theft, damage, destruction, acts of vandalism and all other risks customarily insured against, all of which insurance is in full force and effect.

 

 

 

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(p)   Subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, except as described therein, (i) there has not been any material adverse change in the assets or properties, business, results of operations, prospects or condition (financial or otherwise) of the Company, whether or not arising from transactions in the ordinary course of business; (ii) the Company has not sustained any material loss or interference with its assets, businesses or properties (whether owned or leased) from fire, explosion, earthquake, flood or other calamity, whether or not covered by insurance, or from any labor dispute or any court or legislative or other governmental action, order or decree; (iii) since the date of the latest balance sheet, included or incorporated by reference in the Registration Statement and the Prospectus, except as reflected therein, the Company has not undertaken any liability or obligation, direct or contingent, except such liabilities or obligations undertaken in the ordinary course of business; and (iv) there has not been any transaction that is material to the Company, except transactions in the ordinary course of business or as otherwise disclosed in the Registration Statement and the Prospectus.

 

(q)   There is no document or contract 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 which is not described or filed as required.  Each document, instrument, contract and agreement of the Company described in the Registration Statement or the Prospectus or incorporated by reference therein or listed as exhibits to the Registration Statement is in full force and effect and is valid and enforceable by and against the Company in accordance with their terms, assuming the due authorization, execution and delivery thereof by each of the other parties thereto except as otherwise disclosed in the Registration Statement or Prospectus.  The Company is not, nor to the knowledge of the Company is any other party, in default in the observance or performance of any term or obligation to be performed by it under any such agreement, and no event has occurred which with notice or lapse of time or both would constitute such a default, which default or event would have a Material Adverse Effect.  No default exists, and no event has occurred which with notice or lapse of time or both would constitute a default, in the due performance and observance of any term, covenant or condition, by the Company of any other agreement or instrument to which the Company is a party or by which it or its properties or business may be bound or affected, which default or event would have a Material Adverse Effect.

 

(r)   Neither the Company nor any of its Significant Subsidiaries is in violation of any term or provision of its charter, by-laws, partnership agreement or operating agreement, as applicable.  The Company is not in violation of any franchise, license, permit, judgment, decree, order, statute, rule or regulation, where the consequences of such violation would have a Material Adverse Effect.

 

(s)   Neither the execution, delivery and performance of this Agreement by the Company nor the consummation of any of the transactions contemplated hereby (including, without limitation, the issuance and sale by the Company of the Common Stock) will give rise to a right to terminate or accelerate the due date of any payment due under, or conflict with or result in the breach of any term or provision of, or constitute a default (or an event which with notice or lapse of time or both would constitute a default) under, or require any consent or waiver under, or result in the execution or imposition of any lien, charge, encumbrance, claim, security interest, restriction or defect upon any properties or assets of the Company pursuant to the terms of, any indenture, mortgage, deed of trust or other agreement or instrument to which the Company is a party or by which either is bound, or any of its properties or businesses are bound, or any franchise, license, permit, judgment, decree, order, statute, rule or regulation applicable to the Company or violate any provision of the Company’s charter or by-laws, except for such consents or waivers which have already been obtained and are in full force and effect.

 

(t)   All of the outstanding shares of common stock and preferred stock of the Company have been duly authorized and validly issued and are fully paid and nonassessable and none of them were issued in violation of any preemptive or other similar right.  The Common Stock, when issued and sold pursuant to this Agreement, will be duly authorized and validly issued, fully paid and nonassessable and will not be issued in violation of any preemptive or other similar right.  Except as disclosed in the Registration Statement and the Prospectus, there is no outstanding option, warrant or other right calling for the issuance of, and there is no commitment, plan or arrangement to issue, any securities of the Company or any security convertible into or exercisable or exchangeable for securities of the Company.  The Common Stock conforms in all material respects to all statements relating thereto contained in the Registration Statement and the Prospectus.  Any stock options issued by the Company have been issued in compliance with applicable law, and the terms and provisions of such stock options were established in compliance with applicable law except as would not have a Material Adverse Effect.

 

 

 

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(u)   Subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, except as (x) described or referred to therein, or (y) are not material and are consistent with past practice, the Company has not (i) issued any securities or incurred any liability or obligation, direct or contingent, except such liabilities or obligations incurred in the ordinary course of business and except for securities issued in connection with the Company’s employee benefit and/or dividend reinvestment plans, (ii) entered into any transaction not in the ordinary course of business or (iii) declared or paid any dividend or made any distribution on any of its securities or redeemed, purchased or otherwise acquired or agreed to redeem, purchase or otherwise acquire any of its securities.

 

(v)   Except as disclosed in the Registration Statement and Prospectus, no holder of any security of the Company has the right, which has not been waived, to have any security owned by such holder included in the Registration Statement or any right to demand registration of any security owned by such holder.

 

(w)   All necessary corporate action has been duly and validly taken by the Company to authorize the execution, delivery and performance of this Agreement and the issuance and sale of the Common Stock by the Company except for blue sky filings and New York Stock Exchange listing application, which to the extent required, will be completed prior to any applicable sales.  This Agreement has been duly and validly authorized, executed and delivered by the Company and constitutes and will constitute the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.  Each approval, consent, order, authorization, designation, declaration or filing by or with any regulatory, administrative or other governmental body necessary in connection with the execution and delivery by the Company of this Agreement and the consummation of the transactions contemplated hereby and the issuance and sale of the Common Stock by the Company has been obtained or made and is in full force and effect.  The Common Stock is listed for trading on the Trading Market.  For purposes of this Agreement, the “Trading Market” is (i) the New York Stock Exchange, Inc., and (ii) each other securities exchange on which Common Stock is admitted for trading.

 

(x)   The Company has not incurred any liability for a fee, commission or other compensation on account of the employment of a broker or finder in connection with the transactions contemplated by this Agreement other than as contemplated hereby or as described in the Registration Statement.

 

(y)   The Company is conducting its business in compliance with all applicable laws, rules and regulations of the jurisdictions in which it is conducting business, including, without limitation, the Americans with Disabilities Act of 1990 and all applicable local, state and federal employment, truth-in-advertising, franchising and immigration laws and regulations, except where the failure to be so in compliance would not have a Material Adverse Effect.

 

(z)   No transaction has occurred between or among the Company and any of its officers or directors or any affiliate or affiliates of any such officer or director that is required to be described in and is not adequately described in the Registration Statement and the Prospectus.

 

(aa)   The Company has not taken, nor will it take, directly or indirectly, any action designed to or which might reasonably be expected to cause or result in, or which has constituted or which might reasonably be expected to constitute, the stabilization or manipulation of the price of any securities of the Company to facilitate the sale or resale of any shares of the Common Stock.

 

(bb)   The Company has filed all federal, state, local and foreign tax returns which are required to be filed through the date hereof (and will file all such tax returns when and as required to be filed after the date hereof), or has received extensions thereof, and has paid all taxes shown on such returns to be due on or prior to the date hereof (and will pay all taxes shown on such returns to be due after the date hereof) and all assessments received by it to the extent that the same are material and have become due.

 

(cc)   The Company is, and after giving effect to the offering and sale of the Common Stock, will be, exempt from regulation as an “investment company,” a person “controlled by” an “investment company” or an “affiliated person” of or “promoter” or “principal underwriter” for an “investment company,” as such terms are defined in the Investment Company Act of 1940, as amended (the “Investment Company Act”).

 

 

 

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(dd)   The Company is not involved in any labor dispute and, to the knowledge of the Company, no such dispute has been threatened, except for such disputes as would not have a Material Adverse Effect or subject the Company or its shareholders to any material liability or disability.

 

(ee)   The Company’s systems of internal accounting controls taken as a whole are sufficient to meet the broad objectives of internal accounting control insofar as those objectives pertain to the prevention or detection of errors or irregularities in amounts that would be material in relation to the Company’s financial statements; and, to the best of the Company’s knowledge, neither the Company nor any employee or agent thereof has made any payment of funds of the Company or received or retained any funds, and no funds of the Company have been set aside to be used for any payment, in each case in violation of any law, rule or regulation.

 

(ff)   Except as disclosed in the Registration Statement or the Prospectus, or in any document incorporated therein (i) there has been no storage, disposal, generation, manufacture, refinement, transportation, handling or treatment of toxic wastes, hazardous wastes or hazardous substances by the Company or any of its subsidiaries (or to the knowledge of the Company, any of their predecessors in interest) at, upon or from any of the property now or previously owned or leased by the Company or its subsidiaries in violation of any applicable law, ordinance, rule, regulation, order, judgment, decree or permit or which would require remedial action under any applicable law, ordinance, rule, regulation, order, judgment, decree or permit, except for any violation or remedial action which would not have a Material Adverse Effect; (ii) there has been no spill, discharge, leak, emission, injection, escape, dumping or release of any kind onto such property or into the environment surrounding such property of any toxic wastes, solid wastes, hazardous wastes or hazardous substances due to or caused by the Company or any of its subsidiaries, except for any such spill, discharge, leak emission, injection, escape, dumping or release which would not have a Material Adverse Effect; and (iii) the terms “hazardous wastes,” “toxic wastes” and “hazardous substances” shall have the meanings specified in any applicable local, state, federal and foreign laws or regulations with respect to environmental protection.

 

(gg)   The Company has met the qualification requirements for a “real estate investment trust” during its taxable years ending on or after December 31, 1999 and its proposed method of operations will enable it to continue to meet the requirements for qualification and taxation as a “real estate investment trust” under the Internal Revenue Code of 1986, as amended, assuming no change in the applicable underlying laws.  The Company does not know of any event which would cause or is likely to cause it to fail to qualify as a “real estate investment trust” at any time.

 

(hh)   There is and has been no failure on the part of the Company or, to the knowledge of the Company, any of the Company’s directors or officers, in their capacities as such in relation to the Company, to comply in all material respects with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith, including without limitation Section 402 related to loans and Sections 302 and 906 related to certificates.

 

(ii)   The Company is not an "investment company" within the meaning of the Investment Company Act of 1940, as amended.

 

ARTICLE II

 

 

 

SALE AND DELIVERY OF SECURITIES

 

2.1   (a)           On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company agrees to issue and sell through the Sales Manager, as agent, and the Sales Manager agrees to sell, as agent for the Company, on a best efforts basis, up to 1,600,000 shares of Common Stock during the term of this Agreement on the terms set forth herein.  The Common Stock will be sold from time to time in amounts and at prices as directed by the Company and as agreed to by the Sales Manager.

 

 

 

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(b)           The Company or the Sales Manager may, upon notice to the other party hereto by telephone (confirmed promptly by telecopy), at any time and from time to time suspend the offering of Common Stock; provided , however , that such suspension or termination shall not affect or impair the parties’ respective obligations with respect to the Common Stock sold hereunder prior to the giving of such notice.

 

(c)           The compensation to the Sales Manager for sales of Common Stock shall be at a fixed commission rate of 3% of the gross sales price per share of Common Stock sold under this Agreement.  If, however, during the period between the date hereof and December 31, 2009, the aggregate sales proceeds raised exceed $10 million then the commission rate for any sales made after December 31, 2009, will be 2.5%.  The remaining proceeds, after further deduction for any transaction fees imposed by any governmental or self-regulatory organization in respect to such sale shall constitute the net proceeds to the Company for such Common Stock (the “Net Proceeds”).

 

(d)           The Company shall open and maintain a trading account (the “Trading Account”) at a clearing agent designated by the Sales Manager to facilitate the transactions contemplated by this Agreement.  The Net Proceeds from the sale of the Common Stock shall be available in the Trading Account on the third business day (or such other day as is industry practice for regular-way trading) following each sale of Common Stock (each, a “Settlement Date”).  The Company shall effect the delivery of the applicable number of shares of Common Stock to an account designated by the Sales Manager at The Depository Trust Company on or before the Settlement Date of each sale hereunder.  The Sales Manager’s compensation shall be withheld from the sales proceeds on each Settlement Date and shall be paid to the Sales Manager.

 

(e)           At each Settlement Date, the Company shall be deemed to have affirmed each representation, warranty, covenant and other agreement contained in this Agreement.  Any obligation of the Sales Manager under this Agreement shall be subject to the continuing accuracy of the representations and warranties of the Company herein, to the performance by the Company of its obligations hereunder and to the continuing satisfaction of the additional conditions specified in Article IV of this Agreement.

 

(f)           If the Company shall default on its obligation to deliver shares of Common Stock on any Settlement Date, the Company shall (i) hold the Sales Manager harmless against any loss, claim or damage arising from or as a result of such default by the Company and (ii) pay the Sales Manager any commission to which it would otherwise be entitled absent such default.

 

ARTICLE III

 

 

 

COVENANTS OF THE COMPANY

 

3.1   The Company covenants and agrees with the Sales Manager that:

 

(a)   As promptly as practicable after the date of this Agreement, the Company will file a supplement to the Prospectus to permit sales of the Common Stock pursuant to this Agreement.

 

 

 

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(b)   During the period in which a prospectus relating to the Common Stock is required to be delivered under the Act (including any period where such requirement is deemed satisfied pursuant to Rule 153 or Rule 172 under the Act), the Company will notify the Sales Manager promptly of the time when any subsequent amendment to the Registration Statement has become effective or any subsequent supplement to the Prospectus has been filed and of any request by the Commission for any amendment or supplement to the Registration Statement or the Prospectus or for additional information; the Company will prepare and file with the Commission, promptly upon the Sales Manager’s reasonable request, any amendments or supplements to the Registration Statement or Prospectus that, in the Sales Manager’s reasonable opinion, may be necessary or advisable in connection with the sale of the Common Stock pursuant to this Agreement; the Company will not file any amendment or supplement to the Registration Statement or Prospectus unless a copy thereof has been submitted to the Sales Manager a reasonable period of time before the filing and the Sales Manager has not reasonably objected thereto; and it will notify the Sales Manager at the time of filing thereof a copy of any document that upon filing is deemed to be incorporated by reference in the Registration Statement or Prospectus, which will then be available EDGAR and/or on the Company’s website at www.suncommunities.com (and will furnish to the Sales Manager any such document that is not available on EDGAR or the Company’s website).  The Company will cause each amendment or supplement to the Prospectus to be filed with the Commission as required pursuant to the Rules and Regulations or, in the case of any document to be incorporated therein by reference, to be filed with the Commission as required pursuant to the Exchange Act, within the time period prescribed.

 

(c)   The Company will advise the Sales Manager, promptly after it shall receive notice or obtain knowledge thereof, of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement, of the suspension of the qualification of the Common Stock for offering or sale in any jurisdiction, or of the initiation or threatening of any proceeding for any such purpose; and it will promptly use its best efforts to prevent the issuance of any stop order or to obtain its withdrawal if such a stop order should be issued.

 

(d)   Within the time during which a prospectus relating to the Common Stock is required to be delivered under the Act (including any period where such requirement is deemed satisfied pursuant to Rule 153 or Rule 172 under the Act), the Company will comply with all requirements imposed upon it by the Act and by the Rules and Regulations, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Common Stock as contemplated by the provisions hereof and the Prospectus.  If during such period any event occurs as a result of which the Prospectus, as then amended or supplemented, would include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances then existing, not misleading, or if during such period it is necessary to amend or supplement the Registration Statement or Prospectus to comply with the Act, the Company will promptly notify the Sales Manager to suspend the offering of Common Stock during such period and the Company will amend or supplement the Registration Statement or Prospectus (at the expense of the Company) so as to correct such statement or omission or effect such compliance and will use its best efforts to have any amendment or supplement to the Registration Statement or Prospectus declared effective as soon as possible, unless the Company has reasonable business reasons to defer public disclosure of the relevant information.

 

(e)   The Company will use its best efforts to qualify the Common Stock for sale under the securities laws of such jurisdictions as the Sales Manager designates and to continue such qualifications in effect so long as required for the sale of the Common Stock, except that the Company shall not be required in connection therewith to qualify as a foreign corporation or to execute a general consent to service of process in any jurisdiction.

 

(f)   The Company will furnish to the Sales Manager and its legal counsel (at the expense of the Company) copies of the Registration Statement and the Prospectus during the period in which a prospectus relating to the Stock is required to be delivered under the Act (including any period where such requirement is deemed satisfied pursuant to Rule 153 or Rule 172 under the Act), in each case as soon as available and in such quantities as the Sales Manager may from time to time reasonably request.  The Company will take such action as to enable the conditions set forth in Rule 153(b) to be satisfied at all times that the Sales Agent is selling Stock.

 

(g)   The Company will make generally available to its security holders as soon as practicable, but in any event not later than 15 months after the end of the Company’s current fiscal quarter, an earnings statement (which need not be audited) covering a 12-month period that satisfies the provisions of Section 11(a) of the Act and Rule 158 of the Rules and Regulations.

 

 

 

9


 
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