DEALER MANAGER AGREEMENT
June 29, 2022
Apollo Global Securities, LLC
9 West 57th Street
New York, New York 10019
This Dealer Manager Agreement (this “Agreement”) is entered into by and between Apollo Realty Income Solutions, Inc., a Maryland corporation (the “Company”) and Apollo Global Securities, LLC (the “Dealer Manager”).
The Company has filed one or more registration statements with the U.S. Securities and Exchange Commission (the “SEC”) that are listed on Schedule 1 to this Agreement (each, a “Registration Statement”), which Schedule 1 may be amended from time to time with the written consent of the Company and the Dealer Manager. In this Agreement, unless explicitly stated otherwise, “the Registration Statement” means, at any given time, each of the registration statements listed on Schedule 1, as such Schedule 1 may be amended from time to time, as each such registration statement is finally amended and revised at the effective date of such registration statement (including at the effective date of any post-effective amendment thereto).
Each Registration Statement shall register an ongoing offering (each, an “Offering”) of the Company’s common stock, $0.01 par value per share (“Common Stock”), which may consist of any combination of Class S, Class D, Class I, Class F‑S, Class F‑D, and Class F‑I shares of Common Stock (the “Shares”). In this Agreement, unless explicitly stated otherwise, “the Offering” means each Offering covered by a Registration Statement and “Shares” means the Shares being offered in the Offering.
The Offering is and shall be comprised of a maximum amount of Shares set forth in the Prospectus (as defined in Section 1.a. below) that will be issued and sold to the public at the public offering prices per Share set forth in the Prospectus pursuant to a primary offering (the “Primary Shares”) and the Company’s distribution reinvestment plan (the “DRIP Shares”). In connection with the Offering, the minimum purchase by any one person shall be as set forth in the Prospectus (except as otherwise indicated in any letter or memorandum from the Company to the Dealer Manager). In this Agreement, unless explicitly stated otherwise, any references to the Registration Statement, the Offering, the Shares or the Prospectus with respect to each other shall mean only those that are all related to the same Registration Statement.
The Company is offering to the public six classes of Shares: Class S Shares, Class D Shares, Class I Shares, Class F‑S Shares, Class F‑D Shares, and Class F‑I Shares. The differences between the classes of Shares and the eligibility requirements for each class are described in detail in the Prospectus. The Shares are to be offered and sold to the public as described under the “Plan of Distribution” section of the Prospectus. Except as otherwise agreed by the Company and the Dealer Manager, Shares sold through the Dealer Manager are to be sold through the Dealer Manager, as the dealer manager, and the broker-dealers (each a “Selected Dealer” and collectively, the “Selected Dealers”) with whom the Dealer Manager has entered into or will enter into a selected dealer agreement related to the distribution of Shares substantially in the form attached to this Agreement as Exhibit A or such other form as approved by the Company (each a “Selected Dealer Agreement”) at a purchase price (i) equal to a fixed amount plus applicable upfront selling commissions and dealer manager fees prior to the satisfaction of any minimum offering contingency described in the Prospectus, including any continuing escrow obligations imposed by certain states as described in the Prospectus (the “Minimum Offering”); and (ii) after the Minimum Offering is satisfied, generally equal to the Company’s prior month’s net asset value (“NAV”) per share applicable to the class of Shares being purchased (as calculated in accordance with the procedures described in the Prospectus), or at a different offering price made available to investors in cases where the Company believes there has been a material change to the NAV per Share since the end of the prior month, plus in either case any applicable upfront selling commissions and dealer manager fees, subject in certain circumstances to reductions thereof as described in the Prospectus.
For stockholders who participate in the Company’s distribution reinvestment plan (the “DRIP”), the cash distributions attributable to the class of Shares that each stockholder owns will be automatically invested in additional
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Shares of the same class. The DRIP Shares are to be issued and sold to stockholders of the Company at a purchase price equal to the then-current Primary Share offering price per Share before any applicable selling commissions and dealer manager fees (the “transaction price”) of the applicable class of Shares on the date that the distribution is payable.
Terms not defined herein shall have the same meaning as in the Prospectus. Now, therefore, the Company hereby agrees with the Dealer Manager as follows:
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Notwithstanding the foregoing, subject to the terms of the Prospectus, at such time as the Selected Dealer who sold the Class S Shares, Class D Shares, Class F‑S Shares, or Class F‑D Shares giving rise to a portion of the Servicing Fee is no longer the broker-dealer of record with respect to such Class S Shares, Class D Shares, Class F‑S Shares, or Class F‑D Shares or that the Selected Dealer no longer satisfies any or all of the conditions in its Selected Dealer Agreement for the receipt of the Servicing Fee, then Selected Dealer’s entitlement to the Servicing Fees related to such Class S Shares, Class D Shares, Class F‑S Shares, or Class F‑D Shares, as applicable, shall cease in, and Selected Dealer shall not receive the Servicing Fee for any month in which Selected Dealer is not eligible on the last day of the month. Broker-dealer transfers will be made effective as of the start of the first business day of a month.
Thereafter, such Servicing Fees may be reallowed to the then-current broker-dealer of record of the Class S Shares, Class D Shares, Class F‑S Shares, or Class F‑D Shares, as applicable, if any such broker-dealer of record has been designated (the “Servicing Dealer”), to the extent such Servicing Dealer has entered into a Selected Dealer Agreement or similar agreement with the Dealer Manager (“Servicing Agreement”), such Selected Dealer Agreement or Servicing Agreement with the Servicing Dealer provides for such reallowance and the Servicing Dealer is in compliance with the terms of such agreement related to such reallowance. In this regard, all determinations will be made by the Dealer Manager in good faith in its sole discretion. The Selected Dealer is not entitled to any Servicing Fee with respect to Class I Shares or Class F‑I Shares. The Dealer Manager may also reallow some or all of the Servicing Fee to other broker-dealers who provide services with respect to the applicable Shares (who shall be considered additional Servicing Dealers) pursuant to a Servicing Agreement with the Dealer Manager to the extent such Servicing Agreement provides for such reallowance and such additional Servicing Dealer is in compliance with the terms of such agreement related to such reallowance, in accordance with the terms of such Servicing Agreement.
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In addition, the Dealer Manager will cease receiving the Servicing Fee on Class S Shares, Class D Shares, Class F‑S Shares, and Class F‑D Shares in connection with an Offering (i.e., pursuant to the Registration Statement for such Offering) upon the earlier to occur of the following:
The Company will also cease paying the Servicing Fee on Class S Shares, Class D Shares, Class F‑S Shares, and Class F‑D Shares upon the listing of a class of common stock or such later date or dates not to exceed twelve months from the date of listing as shall be approved by the Company’s board of directors with respect to all or any portion of the outstanding shares of the class or classes of common stock that are not so listed, each share of the class or classes of common stock that are not so listed or of such portion thereof will automatically and without any action on the part of the holder thereof convert into a number of shares of the class of common stock that is listed with an equivalent NAV as such share.
For purposes of this Agreement, the portion of the Servicing Fee accruing with respect to Class S Shares, Class D Shares, Class F‑S Shares, and Class F‑D Shares of the Company’s common stock issued (publicly or privately) by the Company during the term of a particular Offering, and not issued pursuant to a prior Offering, shall be underwriting compensation with respect to such particular Offering and not with respect to any other Offering.
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The Company will reimburse the Dealer Manager and each Indemnified Person of the Dealer Manager for any legal or other expenses reasonably incurred by the Dealer Manager or such Indemnified Person in connection with investigating or defending such Loss.
Notwithstanding the foregoing provisions of this Section 4.a., the Company may not indemnify or hold harmless the Dealer Manager, any Selected Dealer or any of their affiliates in any manner that would be inconsistent with the provisions to Article II.G of the NASAA Guidelines. In particular, but without limitation, the Company may not indemnify or hold harmless the Dealer Manager, any Selected Dealer or any of their affiliates for liabilities arising from or out of a violation of state or federal securities laws, unless one or more of the following conditions are met:
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Further, notwithstanding the foregoing provisions of this Section 4.a., the Company will not be liable in any such case to the extent that any such Loss or expense arises out of or is based upon an untrue statement or omission made in reliance upon and in conformity with written information furnished (x) to the Company by the Dealer Manager or (y) to the Company or the Dealer Manager by or on behalf of any Selected Dealer specifically for use in the Registration Statement, the Prospectus, any preliminary prospectus used prior to the effective date of the Registration Statement or any post-effective amendment or supplement to any of them, any Blue Sky Application or any Authorized Sales Materials, and, further, the Company will not be liable for the portion of any Loss in any such case if it is determined that such Selected Dealer or the Dealer Manager was at fault in connection with such portion of the Loss, expense or action.
The foregoing indemnity agreement of this Section 4.a. is subject to the further condition that, insofar as it relates to any untrue statement or omission made in the Prospectus (or amendment or supplement thereto) that was eliminated or remedied in any subsequent amendment or supplement thereto, such indemnity agreement shall not inure to the benefit of an Indemnified Party from whom the person asserting any Losses purchased the Shares that are the subject thereof, if a copy of the Prospectus as so amended or supplemented was not sent or given to such person at or prior to the time the subscription of such person was accepted by the Company, but only if a copy of the Prospectus as so amended or supplemented had been supplied to the Dealer Manager or the Selected Dealer prior to such acceptance.
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The Dealer Manager will reimburse the aforesaid parties for any legal or other expenses reasonably incurred by them in connection with investigating or defending such Loss, expense or action. This indemnity agreement will be in addition to any liability that the Dealer Manager may otherwise have.
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In offering Shares, the Dealer Manager, in its agreements with Selected Dealers, will require that the Selected Dealer comply with the provisions of all applicable rules and regulations relating to suitability of investors, including, without limitation, the provisions of Article III.C. of the NASAA Guidelines and any enhanced standard of care applicable under Regulation Best Interest promulgated under the Exchange Act.
The Dealer Manager, in its agreements with Selected Dealers, will require that the Selected Dealers shall sell Class D Shares, Class F‑D Shares, Class I Shares, and Class F‑I Shares only to those persons who are eligible to purchase such shares as described in the Prospectus and only through those Selected Dealers who are authorized to sell such Shares.
The Dealer Manager, in its agreements with the Selected Dealers, shall require the Selected Dealers to maintain, for at least six years, a record of the information obtained to determine that an investor meets the financial qualification and suitability standards imposed on the offer and sale of the Shares.
To the extent the Dealer Manager is involved in the distribution process other than through a Selected Dealer, the Dealer Manager will comply with such submission of orders procedures, and will require each person desiring to purchase Shares in the Offering to complete and execute a subscription agreement in the form filed as an appendix to
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the Prospectus (a “Subscription Agreement”) in the form provided by the Company to the Dealer Manager for use in connection with the Offering and to deliver to the Dealer Manager or as otherwise directed by the Dealer Manager such completed and executed Subscription Agreement together with a check or wire transfer (“instrument of payment”) in the amount of such person’s purchase, which must be at least the minimum purchase amount set forth in the Prospectus.
Subscription Agreements and instruments of payment will be transmitted by the Dealer Manager to the escrow agent described in the Prospectus and Subscription Agreement for any Offering in which there is a Minimum Offering that has not yet been satisfied or, after any such Minimum Offering is satisfied or if no such Minimum Offering is applicable to an Offering, to the Company, as soon as practicable, but in any event by the end of the second business day following receipt by the Dealer Manager.
If the Dealer Manager receives a Subscription Agreement or instrument of payment not conforming to the instructions set forth in the form of Selected Dealer Agreement, the Dealer Manager shall return such Subscription Agreement and instrument of payment directly to such subscriber not later than the end of the next business day following its receipt. Instruments of payment of rejected subscribers will be promptly returned to such subscribers.
If to the Dealer Manager: | Apollo Global Securities, LLC |
If to the Company: | Apollo Realty Income Solutions, Inc. |
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If the foregoing correctly sets forth our understanding, please indicate your acceptance thereof in the space provided below for that purpose, whereupon this letter and your acceptance shall constitute a binding agreement between us as of the date first above written.
Very truly yours, | ||
APOLLO REALTY INCOME SOLUTIONS, INC. | ||
By: |
| /s/ John Calace |
|
| Name: John Calace |
Accepted and agreed to as of the date first above written:
APOLLO GLOBAL SECURITIES, LLC | ||
By: |
| /s/ Jacob Walker |
|
| Name: Jacob Walker |
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Schedule 1
Registration Statement(s)
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Schedule 2
Compensation
I. Selling Commissions
Subject to certain Selected Dealers’ right to receive selling commissions as described in the Selected Dealer Agreement, the Company will pay to the Dealer Manager selling commissions in the amount of:
(a) up to 3.0% of the transaction price per share of each Class S Share sold;
(b) up to 1.5% of the transaction price per share of each Class D Share sold;
(c) up to 3.0% of the transaction price per share of each Class F-S Share sold; and
(d) up to 1.5% of the transaction price per share of each Class F-D Share sold.
The Company will not pay to the Dealer Manager any selling commissions in respect of the purchase of any Class I Shares, Class F‑I Shares, or DRIP Shares.
II. Dealer Manager Fees
The Company will pay to the Dealer Manager dealer manager fees in the amount of up to 0.5% of the transaction price per share of each Class S Share or Class F-S Share sold; however, such amount may vary pursuant to the Selected Dealer Agreement with certain Dealers, provided that the sum of upfront selling commissions and dealer manager fees shall not exceed 3.5% of the transaction price of each Class S Share or Class F-S Share sold.
The Company will not pay to the Dealer Manager any dealer manager fees in respect of the purchase of any Class D Shares, Class I Shares, Class F-D Shares, Class F-I Shares, or DRIP Shares.
III. Servicing Fee
The Company will pay to the Dealer Manager a Servicing Fee with respect to outstanding Class S Shares and Class F-S Shares that is paid monthly in an amount equal to 0.85% per annum of the aggregate NAV of the outstanding Class S Shares and Class F-S Shares.
The Company will pay to the Dealer Manager a Servicing Fee with respect to outstanding Class D Shares and Class F-D Shares that is paid monthly in an amount equal to 0.25% per annum of the aggregate NAV of the outstanding Class D Shares and Class F-D Shares.
The Company will not pay the Dealer Manager a Servicing Fee with respect to Class I Shares or Class F-I Shares.
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EXHIBIT A
FORM OF SELECTED DEALER AGREEMENT
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