Subscription Agent Agreement [Form] (2015)Full Document 

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Form of

Subscription Agent Agreement


Gyrodyne Company of America, Inc.


Computershare Trust Company, N.A.


Computershare Inc.

Subscription Agent 12615

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THIS SUBSCRIPTION AGENT AGREEMENT (the “Agreement”) is entered into as of this _____day of May 2015 (the “Effective Date”) by and among Gyrodyne Company of America, Inc., a company organized and existing under the laws of the State of New York (the "Company"), and Computershare Trust Company, N.A., a national banking association (“Trust Company”), and Computershare Inc., a Delaware corporation (“Computershare” and, collectively with Trust Company, the “Agent”).

1. Appointment.

1.1 The Company is making an offer (the “Subscription Offer”) to issue to the holders of record of its outstanding shares of Common Stock, par value $1.00 per share (the “Common Stock”), at the close of business on May 6, 2015 (the “Record Date”), the non-transferable right to subscribe for and purchase (each a “Right”) shares of Common Stock (the “Additional Common Stock”) at a purchase price of $2.75 per share of Additional Common Stock (the “Subscription Price”), payable as described on the Subscription Form sent to eligible shareholders, upon the terms and conditions set forth herein. The term “Subscribed” shall mean submitted for purchase from the Company by a shareholder in accordance with the terms of the Subscription Offer, and the term “Subscription” shall mean any such submission. The Company hereby appoints Agent to act as subscription agent in connection with the Subscription Offer and Agent hereby accepts such appointment in accordance with and subject to the terms and conditions of this Agreement.

1.2 The Subscription Offer will expire at 5:00 P.M., Eastern Time, on June [ ● ], 2015 (the “Expiration Time”), unless the Company shall have extended the period of time for which the Subscription Offer is open, in which event the term “Expiration Time” shall mean the latest time and date at which the Subscription Offer, as so extended by the Company from time to time, shall expire.

1.3 The Company filed a Registration Statement relating to the Additional Common Stock with the Securities and Exchange Commission under the Securities Act of 1933 (the “1933 Act”), as amended, on March 6, 2015, and such Registration Statement was declared effective on May __, 2015. The terms of the Additional Common Stock are more fully described in the Prospectus forming part of the Registration Statement as it was declared effective. All terms used and not defined herein shall have the same meaning as in the Prospectus.

1.4 Promptly after the Record Date, the Company will furnish Agent, or instruct Agent in its capacity as transfer agent for the Company, to prepare a certified list in a format acceptable to Agent of holders of record of Shares at the Record Date, including each such holder’s name, address, taxpayer identification number (“TIN”), Share amount with applicable tax lot detail, any certificate detail and information regarding any applicable account stops or blocks (the “Record Shareholders List”).

1.5 No later than the earlier of (i) forty-five (45) days after the Record Dateor (ii) January 15 of the year following the year in which the Record Date occurs, the Company shall deliver to Agent written direction on the adjustment of cost basis for covered securities that arise from or are affected by the Subscription Offer in accordance with current Internal Revenue Service regulations.(see Exhibit “B” for additional information)

2. Subscription of Rights.

2.1 Each holder will receive three (3) Rights (rounded to the nearest whole number, with halves rounded down) for every two (2) shares of capital stock owned as of 5:00 p.m., New York City time, on the Record Date. The Rights entitle the holders to subscribe, upon payment of the Subscription Price, for shares of Additional Common Stock at the rate of one share(s) for each Right (the “Basic Subscription Privilege”).

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2.2 If subscribing shareholders who exercise their Rights in full are entitled to exercise an oversubscription right, then the Company shall provide Agent with instructions regarding the allocation to such shareholders of Additional Common Stock after the initial allocation thereof.

2.3 Except as otherwise indicated to the Agent by the Company in writing, all Common Stock delivered hereunder upon exercise of Rights will be delivered free of restrictive legends. Company shall, if applicable, inform Agent as soon as possible in advance as to whether any Common Stock issued hereunder is to be issued with restrictive legend(s) and, if so, the Company shall provide the appropriate legend(s) and a list identifying the affected shareholders, certificate numbers (if applicable) and share amounts for such affected shareholders.

3. Duties of Subscription Agent.

3.1 Agent shall issue the Rights in accordance with this Agreement in the names of the holders of the Common Stock of record on the Record Date, keep such records as are necessary for the purpose of recording such issuance, and furnish a copy of such records to the Company.

3.2 Promptly after Agent receives the Record Shareholders List, Agent shall:


mail or cause to be mailed, by first class mail, to each holder of Common Stock of record on the Record Date whose address of record is within the United States and Canada, (i) a subscription form with respect to the Rights to which such shareholder is entitled under the Subscription Offer (the “Subscription Form”), a form of which is attached hereto as Exhibit A, (ii) a copy of the Prospectus and (iii) a return envelope addressed to the Agent; and


At the direction of the Company, mail or cause to be mailed, by courier, to each holder of Common Stock of record on the Record Date whose address of record is outside the United States and Canada, or is an A.P.O. or F.P.O. address, a copy of the Prospectus. Agent shall refrain from mailing Subscription Forms to any holder of Common Stock of record on the Record Date whose address of record is outside the United States and Canada, or is an A.P.O. or F.P.O. address, and hold such Subscription Forms for the account of such shareholder subject to such shareholder making satisfactory arrangements with the Agent for the exercise or other disposition of the Rights described therein, and effect the exercise, sale or delivery of such Rights in accordance with the terms of this Agreement if notice of such arrangements are received at or before 11:00 a.m., Eastern Time, on June [ ● ], 2015. In the event a request to exercise subscription rights is received from such a holder, Agent will consult with the Company for instructions as to the number of shares of Additional Common Stock, if any, Agent is authorized to issue.

(c) Upon request by the Company, Agent shall mail or deliver a copy of the Prospectus (i) to each assignee or transferee of Rights upon receiving appropriate documents satisfactory to the Agent to register the assignment or transfer thereof and (ii) with shares of Additional Common Stock when such are issued to persons other than the registered holder of the Rights.

(d) Agent shall accept Subscriptions upon the due exercise of Rights (including payment of the Subscription Price) on or prior to the Expiration Time in accordance with the Subscription Form.

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(e) Agent shall accept Subscriptions, without further authorization or direction from the Company, without procuring supporting legal papers or other proof of authority to sign (including without limitation proof of appointment of a fiduciary or other person acting in a representative capacity), and without signatures of co-fiduciaries, co-representatives or any other person:

(i) if the Right is registered in the name of a fiduciary and the Subscription Form is executed by such fiduciary, provided the Additional Common Stock is to be issued in the name of such fiduciary;

(ii) if the Right is registered in the name of joint tenants and the Subscription Form is executed by one of the joint tenants, provided the Additional Common Stock is to be issued in the names of such joint tenants; or

(iii) if the Right is registered in the name of a corporation and the Subscription Form is executed by a person in a manner which appears or purports to be done in the capacity of an officer or agent thereof, provided the Additional Common Stock is to be issued in the name of such corporation.


Each document received by Agent relating to its duties hereunder shall be dated and time stamped when received at the applicable address(es) as outlined on the offering documents.


Agent shall, absent of specific and mutually agreed instructions from the Company, follow its normal and customary procedures with respect to the acceptance or rejection of all Subscriptions received after the Expiration Time. Subscriptions not authorized to be accepted pursuant to this Section 3 and Subscriptions otherwise failing to comply with the terms and conditions of the Subscription Form will be rejected and returned to the shareholder.


Company shall provide an opinion of counsel prior to the Expiration Time to set up reserve of shares. The opinion shall state that all New Shares, or the transactions in which they are being issued, as applicable, are:


Registered, or subject to a valid exemption from registration, under the 1933 Act, as amended, and all appropriate state securities law filings have been made with respect to the shares, or alternatively, that the shares are “covered securities” under Section 18 of the 1933 Act; and


Validly issued, fully paid and non-assessable.

4. Acceptance of Subscriptions.

4.1 Following Agent’s first receipt of Subscriptions, on each business day, or more frequently if reasonably requested as to major tally figures, forward a report by email to Frederick C. Braun, President and Chief Executive Officer of the Company (the “Company Representative”), as to the following information, based upon a preliminary review (and at all times subject to final determination by the Company) as of the close of business on the preceding business day or the most recent practicable time prior to such request, as the case may be: (i) the total number of shares of Additional Common Stock Subscribed for; (ii) the total number of Rights sold; (iii) the total number of Rights partially Subscribed for; (iv) the amount of funds received; and (v) the cumulative totals in categories (i) through (iv) above.

4.2 As promptly as possible following the Expiration Time, advise the Company Representative by email of (i) the number of shares of Additional Common Stock Subscribed for and (ii) the number of shares of Additional Common Stock unsubscribed for.

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4.3 Upon acceptance of a Subscription, all funds received by Computershare under this Agreement that are to be distributed or applied by Computershare in the performance of Services (the “Funds”) shall be held by Computershare as agent for Company and deposited in one or more bank accounts to be maintained by Computershare in its name as agent for Company. Until paid pursuant to this Agreement, Computershare may hold or invest the Funds through such accounts in: (a) obligations of, or guaranteed by, the United States of America; (b) commercial paper obligations rated A-1 or P-1 or better by Standard & Poor's Corporation (“S&P”) or Moody's Investors Service, Inc. (“Moody’s”), respectively; (c) money market funds that comply with Rule 2a-7 of the Investment Company Act of 1940; or (d) demand deposit accounts, short term certificates of deposit, bank repurchase agreements or bankers’ acceptances, of commercial banks with Tier 1 capital exceeding $1 billion or with an average rating above investment grade by S&P (LT Local Issuer Credit Rating), Moody’s (Long Term Rating) and Fitch Ratings, Inc. (LT Issuer Default Rating) (each as reported by Bloomberg Finance L.P.). Computershare shall have no responsibility or liability for any diminution of the Funds that may result from any deposit or investment made by Computershare in accordance with this paragraph, including any losses resulting from a default by any bank, financial institution or other third party. Computershare may from time to time receive interest, dividends or other earnings in connection with such deposits or investments, which will be held at the Company’s risk. Computershare shall not be obligated to pay such interest, dividends or earnings to Company, any Shareholder or any other party.

5. Completion of Subscription Offer.

5.1 Upon completion of the Subscription Offer, Agent shall request the transfer agent for the Common Stock to issue the appropriate number of shares of Additional Common Stock as required in order to effectuate the Subscriptions.

5.2 The Rights shall be issued in registered, book-entry form only. Agent shall keep books and records of the registration, transfer and exchange of Rights (the “Rights Register”).

5.3 All Rights issued upon any registration of transfer or exchange of Rights shall be the valid obligations of the Company, evidencing the same obligations and entitled to the same benefits under this Agreement as the Rights surrendered for such registration of transfer or exchange; provided that, until such transfer or exchange is registered in the Rights Register, the Company and Agent may treat the registered holder thereof as the owner for all purposes.

5.4 For so long as this Agreement shall be in effect, the Company will reserve for issuance and keep available free from preemptive rights a sufficient number of shares of Additional Common Stock to permit the exercise in full of all Rights issued pursuant to the Subscription Offer.

5.5 The Company shall take any and all action, including without limitation obtaining the authorization, consent, lack of objection, registration or approval of any governmental authority, or the taking of any other action under the laws of the United States of America or any political subdivision thereof, to insure that all shares of Additional Common Stock issuable upon the exercise of the Rights (subject to payment of the Subscription Price) will be duly and validly issued and fully paid and non-assessable shares of Common Stock, free from all preemptive rights and taxes, liens, charges and security interests created by or imposed upon the Company with respect thereto.

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