Exhibit 1(b)
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XXXXX XXXXXXX XXXXXX #00-0000 LTD.
DEALER-MANAGER AGREEMENT
WITH
XXXXX FUNDING, INC.
XXXXX FUNDING, INC.
DEALER-MANAGER AGREEMENT
TABLE OF CONTENTS
Page
1. Description of Units..................................................................................1
2. Representations, Warranties and Agreements of the Managing General Partner............................1
3. Grant of Authority to the Dealer-Manager..............................................................2
4. Compensation and Fees.................................................................................2
5. Covenants of the Managing General Partner.............................................................4
6. Representations and Warranties of the Dealer-Manager..................................................4
7. State Securities Registration.........................................................................8
8. Expense of Sale.......................................................................................9
9. Conditions of the Dealer-Manager's Duties.............................................................9
10. Conditions of the Managing General Partner's Duties..................................................10
11. Indemnification......................................................................................10
12. Representations and Agreements to Survive Delivery...................................................11
13. Termination..........................................................................................11
14. Notices..............................................................................................11
15. Format of Checks/Escrow Agent........................................................................12
16. Transmittal Procedures...............................................................................12
17. Parties..............................................................................................13
18. Relationship.........................................................................................13
19. Effective Date.......................................................................................13
20. Entire Agreement, Waiver.............................................................................13
21. Complaints...........................................................................................13
22. Privacy..............................................................................................14
Exhibit A - Escrow Agreement for Atlas America Public #11-2002 Ltd.
Exhibit B - Selling Agent Agreement
Xxxxx Funding, Inc. i
Dealer-Manager Agreement
XXXXX FUNDING, INC.
DEALER-MANAGER AGREEMENT
(Best Efforts)
RE: ATLAS AMERICA PUBLIC #11-2002 LTD.
----------------------------------
Xxxxx Funding, Inc.
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Gentlemen:
The undersigned, Atlas Resources, Inc., which is referred to as the
"Managing General Partner," on behalf of Atlas America Public #11-2002 Ltd.,
confirms its agreement with you, as Dealer-Manager, as follows:
1. Description of Units. The Managing General Partner has formed a limited
partnership known as Atlas America Public #11-2002 Ltd., which is
referred to as "the "Partnership," which will issue and sell the Units
in the Partnership, which are referred to as the "Units," at a price of
$10,000 per Unit subject to the discounts set forth in Section 4(c) of
this Agreement for certain investors. Subject to the receipt and
acceptance by the Managing General Partner of the minimum subscription
proceeds of $1,000,000, the Managing General Partner may break escrow
and use the subscription proceeds for the Partnership's drilling
activities, which is referred to as the "Initial Closing Date."
No subscriptions to the Partnership will be accepted after whichever of
the following events occurs first, which is referred to as the
"Offering Termination Date":
o receipt of the maximum subscriptions of $40,000,000; or
o December 31, 2002.
2. Representations, Warranties and Agreements of the Managing General
Partner. The Managing General Partner represents and warrants to and
agrees with you that:
(a) The Partnership has a currently effective registration
statement on Form S-1, including a final prospectus, for the
registration of the Units under the Securities Act of 1933, as
amended, which is referred to as the "Act." Such registration
statement, as it may be amended, and the prospectus and
exhibits on file with the SEC, as well as any post-effective
amendments or supplements to such registration statement or
prospectus after the effective date of registration, which are
respectively referred to as the "Registration Statement" and
the "Prospectus."
(b) The Managing General Partner shall provide to you for delivery
to all offerees and purchasers and their representatives the
information and documents that the Managing General Partner
deems appropriate to comply with the Act and applicable state
securities acts, which are referred to as the "Blue Sky" laws.
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Dealer-Manager Agreement
(c) The Units when issued will be duly authorized and validly
issued as set forth in the Amended and Restated Certificate
and Agreement of Limited Partnership of the Partnership, which
is referred to as the "Partnership Agreement," included as
Exhibit (A) to the Prospectus, and subject only to the rights
and obligations set forth in the Partnership Agreement or
imposed by the laws of the state of the Partnership's
formation or of any jurisdiction to the laws of which the
Partnership is subject.
(d) The Partnership was duly formed under the laws of the State of
Delaware and is validly existing as a limited partnership in
good standing under the laws of Delaware with full power and
authority to own its properties and conduct its business as
described in the Prospectus. The Partnership will be qualified
to do business as a limited partnership or similar entity
offering limited liability in those jurisdictions where the
Managing General Partner deems the qualification necessary to
assure limited liability of the limited partners.
(e) The Prospectus, as supplemented or amended, does not contain
an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements in the
Prospectus, in the light of the circumstances under which they
are made, not misleading.
3. Grant of Authority to the Dealer-Manager. Based on the representations
and warranties contained in this Agreement, and subject to the terms
and conditions set forth in this Agreement, the Managing General
Partner appoints you as the Dealer-Manager for the Partnership and
gives you the exclusive right to solicit subscriptions for the Units on
a "best efforts" basis in the states of:
(a) Minnesota; and
(b) New Hampshire.
In the states of Minnesota and New Hampshire you agree to use your best
efforts to effect sales of the Units and to form and manage a selling
group composed of soliciting broker/dealers, which are referred to as
the "Selling Agents," each of which shall be a member of the National
Association of Securities Dealers, Inc., which is referred as the
"NASD," and shall enter into a "Selling Agent Agreement" in
substantially the form attached to this Agreement as Exhibit "B."
The Managing General Partner shall have three business days after the
receipt of an executed Selling Agent Agreement to refuse that Selling
Agent's participation.
4. Compensation and Fees.
(a) As Dealer-Manager you shall receive from the Managing General
Partner the following compensation, based on each Unit sold to
investors who are situated and/or residents in the states of
Minnesota and New Hampshire and whose subscriptions for Units
are accepted by the Managing General Partner:
(i) a 2.5% Dealer-Manager fee;
(ii) a 7% Sales Commission;
(iii) a .5% nonaccountable reimbursement of marketing
expenses; and
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(iv) a .5% reimbursement of the Selling Agents' bona fide
accountable due diligence expenses.
(b) All of the Sales Commissions and the .5% reimbursement of the
Selling Agents' bona fide accountable due diligence expenses
shall be reallowed to the Selling Agents, and all or a portion
of the .5% nonaccountable marketing expense reimbursement
shall be reallowed to the Selling Agents. The 2.5%
Dealer-Manager fee shall be reallowed to the wholesalers for
subscriptions obtained through their efforts. You shall retain
any of the .5% nonaccountable marketing expense reimbursement
not reallowed to the Selling Agents.
(c) Notwithstanding the foregoing:
(i) the Managing General Partner, its officers,
directors, and affiliates, and investors who buy
Units through the officers and directors of the
Managing General Partner may subscribe to Units for a
subscription price reduced by the 2.5% Dealer-Manager
fee, the 7% Sales Commission, the .5% nonaccountable
marketing expense reimbursement, and the .5%
reimbursement of the Selling Agents' bona fide
accountable due diligence expenses which shall not be
paid to you; and
(ii) registered investment advisors and their clients and
Selling Agents and their registered representatives
and principals may subscribe to Units for a
subscription price reduced by the 7% Sales
Commission, which shall not be paid to you, although
their subscription price shall not be reduced by the
2.5% Dealer-Manager fee, the .5% nonaccountable
marketing expense reimbursement, and the .5%
reimbursement of the Selling Agents' bona fide
accountable due diligence expenses which shall be
paid to you.
(d) Pending receipt and acceptance by the Managing General Partner
of the minimum subscription proceeds of $1,000,000, excluding:
(i) any optional subscription of the Managing General
Partner and its Affiliates; and
(ii) the subscription discounts set forth in Section 4(c)
of this Agreement;
all proceeds received by you from the sale of Units shall be
held in a separate interest bearing escrow account as provided
in Section 15 of this Agreement.
Unless at least the minimum subscription proceeds of
$1,000,000 as described above are received on or before the
Offering Termination Date as described in Section 1 of this
Agreement, the offering of Units shall be terminated, in which
event:
(i) the 2.5% Dealer-Manager fee, the 7% Sales Commission,
the .5% nonaccountable marketing expense
reimbursement, and the .5% reimbursement of the
Selling Agents' bona fide accountable due diligence
expenses set forth in Section 4(a) of this Agreement
shall not be payable to you;
(ii) all funds advanced by subscribers shall be returned
to them with interest earned; and
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(iii) you shall deliver a termination letter in the form
provided to you by the Managing General Partner to
each of the subscribers and to each of the offerees
previously solicited by you and the Selling Agents in
connection with the offering of the Units.
(e) Except as otherwise provided below, the fees, reimbursements,
and Sales Commissions set forth in Section 4(a) of this
Agreement shall be paid to you within five business days after
the following:
(i) at least the minimum subscription proceeds of
$1,000,000 as described above have been received by
the Partnership and accepted by the Managing General
Partner; and
(ii) the subscription proceeds have been released from the
escrow account to the Managing General Partner.
You shall reallow to the Selling Agents and the wholesalers
their respective fees, reimbursements, and Sales Commissions
as set forth in Section 4(b) of this Agreement.
Thereafter, your fees, reimbursements, and Sales Commissions
shall be paid to you and shall be reallowed to the Selling
Agents and wholesalers as described above approximately every
two weeks until the Offering Termination Date, and all your
remaining fees, reimbursements, and Sales Commissions shall be
paid by the Managing General Partner no later than fourteen
business days after the Offering Termination Date.
5. Covenants of the Managing General Partner. The Managing General Partner
covenants and agrees that:
(a) The Managing General Partner shall deliver to you ample copies
of the Prospectus and all amendments or supplements to the
Prospectus.
(b) If any event affecting the Partnership or the Managing General
Partner occurs that in the opinion of the Managing General
Partner should be set forth in a supplement or amendment to
the Prospectus, then the Managing General Partner shall
promptly at its expense prepare and furnish to you a
sufficient number of copies of a supplement or amendment to
the Prospectus so that it, as so supplemented or amended, will
not contain an untrue statement of a material fact or omit to
state any material fact necessary in order to make the
statements in the Prospectus, in the light of the
circumstances under which they are made, not misleading.
6. Representations and Warranties of the Dealer-Manager. You, as the
Dealer-Manager, represent and warrant to the Managing General Partner
that:
(a) You are a corporation duly organized, validly existing and in
good standing under the laws of the state of your formation or
of any jurisdiction to the laws of which you are subject, with
all requisite power and authority to enter into this Agreement
and to carry out your obligations under this Agreement.
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(b) This Agreement when accepted and approved shall be duly
authorized, executed, and delivered by you and shall be a
valid and binding agreement on your part in accordance with
its terms.
(c) The consummation of the transactions contemplated by this
Agreement and the Prospectus shall not result in the
following:
(i) any breach of any of the terms or conditions of, or a
default under your Articles of Incorporation or
Bylaws, or any other indenture, agreement, or other
instrument to which you are a party; or
(ii) any violation of any order applicable to you of any
court or any federal or state regulatory body or
administrative agency having jurisdiction over you or
your affiliates.
(d) You are duly registered under the provisions of the Securities
Exchange Act of 1934, which is referred to as the "Act of
1934," as a dealer, and you are a member in good standing of
the NASD. You are duly registered as a broker/dealer in the
states where you are required to be registered in order to
carry out your obligations as contemplated by this Agreement
and the Prospectus. You agree to maintain all the foregoing
registrations in good standing throughout the term of the
offer and sale of the Units, and you agree to comply with all
statutes and other requirements applicable to you as a
broker/dealer under those registrations.
(e) Pursuant to your appointment as Dealer-Manager, you shall use
your best efforts to exercise the supervision and control that
you deem necessary and appropriate to the activities of you
and the Selling Agents to comply with all the provisions of
the Act, insofar as the Act applies to your and their
activities under this Agreement. Further, you and the Selling
Agents shall not engage in any activity which would cause the
offer and/or sale of the Units not to comply with the Act, the
Act of 1934, the applicable rules and regulations of the
Commission, the applicable state securities laws and
regulations, this Agreement, and the NASD Conduct Rules
including Rules 2420, 2730, 2740, 2750, and Rule 2810(b)(2)
and (b)(3), which provide as follows:
Sec. (b)(2)
Suitability
(A) A member or person associated with a member
shall not underwrite or participate in a
public offering of a direct participation
program unless standards of suitability have
been established by the program for
participants therein and such standards are
fully disclosed in the prospectus and are
consistent with the provisions of
subparagraph (B) of this section.
(B) In recommending to a participant the
purchase, sale or exchange of an interest in
a direct participation program, a member or
person associated with a member shall:
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(i) have reasonable grounds to believe,
on the basis of information obtained
from the participant concerning his
investment objectives, other
investments, financial situation and
needs, and any other information
known by the member or associated
person, that:
(a) the participant is or will
be in a financial position
appropriate to enable him
to realize to a significant
extent the benefits
described in the
prospectus, including the
tax benefits where they are
a significant aspect of the
program;
(b) the participant has a fair
market net worth sufficient
to sustain the risks
inherent in the program,
including loss of
investment and lack of
liquidity; and
(c) the program is otherwise
suitable for the
participant; and
(ii) maintain in the files of the member
documents disclosing the basis upon
which the determination of
suitability was reached as to each
participant.
(C) Notwithstanding the provisions of
subparagraphs (A) and (B) hereof, no member
shall execute any transaction in a direct
participation program in a discretionary
account without prior written approval of
the transaction by the customer.
Sec. (b)(3)
Disclosure
(A) Prior to participating in a public offering
of a direct participation program, a member
or person associated with a member shall
have reasonable grounds to believe, based on
information made available to him by the
sponsor through a prospectus or other
materials, that all material facts are
adequately and accurately disclosed and
provide a basis for evaluating the program.
(B) In determining the adequacy of disclosed
facts pursuant to subparagraph (A) hereof, a
member or person associated with a member
shall obtain information on material facts
relating at a minimum to the following, if
relevant in view of the nature of the
program:
(i) items of compensation;
(ii) physical properties;
(iii) tax aspects;
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(iv) financial stability and experience
of the sponsor;
(v) the program's conflicts and risk
factors; and
(vi) appraisals and other pertinent
reports.
(C) For purposes of subparagraphs (A) and (B)
hereof, a member or person associated with a
member may rely upon the results of an
inquiry conducted by another member or
members, provided that:
(i) the member or person associated with
a member has reasonable grounds to
believe that such inquiry was
conducted with due care;
(ii) the results of the inquiry were
provided to the member or person
associated with a member with the
consent of the member or members
conducting or directing the inquiry;
and
(iii) no member that participated in the
inquiry is a sponsor of the program
or an affiliate of such sponsor.
(D) Prior to executing a purchase transaction in
a direct participation program, a member or
person associated with a member shall inform
the prospective participant of all pertinent
facts relating to the liquidity and
marketability of the program during the term
of investment.
(f) You agree to advise the Managing General Partner in writing of
each state in which you and the Selling Agents propose to
offer or sell the Units; and you shall not nor shall you
permit any Selling Agent to offer or sell the Units in any
state until you have been advised in writing by the Managing
General Partner, or the Managing General Partner's special
counsel, that the offer or sale of the Units:
(i) has been qualified in the state;
(ii) is exempt from the qualification requirements imposed
by the state; or
(iii) the qualification is otherwise not required.
(g) You and the Selling Agents have received copies of the
Prospectus relating to the Units and you and the Selling
Agents have relied only on the statements contained in the
Prospectus and not on any other statements whatsoever, either
written or oral, with respect to the details of the offering
of Units.
Also, unless advised otherwise by the Managing General
Partner, you and the Selling Agents may choose to provide each
offeree with a brochure entitled "Atlas America Public
#11-2002 Ltd." which is referred to as the "Sales Literature."
(h) You and the Selling Agents agree that you and the Selling
Agents shall not place any advertisement or other solicitation
with respect to the Units (including without limitation
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Dealer-Manager Agreement
any material for use in any newspaper, magazine, radio or
television commercial, telephone recording, motion picture, or
other public media) without the prior written approval of the
Managing General Partner, and without the prior written
approval of the form and content thereof by the Commission,
the NASD and the securities authorities of the states where
such advertisement or solicitation is to be circulated. Any
such advertisements or solicitations shall be at your expense.
(i) If a supplement or amendment to the Prospectus is prepared and
delivered to you by the Managing General Partner, you agree
and shall require any Selling Agent to agree as follows:
(1) to distribute each supplement or amendment to the
Prospectus to every person who has previously
received a copy of the Prospectus from you and/or the
Selling Agent; and
(2) to include each supplement or amendment in all future
deliveries of any Prospectus.
(j) In connection with any offer or sale of the Units, you agree
and shall require any Selling Agent to agree to the following:
(1) to comply in all respects with statements set forth
in the Prospectus, the Partnership Agreement, and any
supplements or amendments to the Prospectus;
(2) not to make any statement inconsistent with the
statements in the Prospectus, the Partnership
Agreement, and any supplements or amendments to the
Prospectus;
(3) not to make any untrue or misleading statements of a
material fact in connection with the Units; and
(4) not to provide any written information, statements,
or sales materials other than the Prospectus, the
Sales Literature, and any supplements or amendments
to the Prospectus unless approved in writing by the
Managing General Partner.
(k) You agree to use your best efforts in the solicitation and
sale of the Units and to coordinate and supervise the efforts
of the Selling Agents, and you shall require any Selling Agent
to agree to use its best efforts in the solicitation and sale
of the Units, including that the prospective purchasers meet
the suitability requirements set forth in the Prospectus and
the Subscription Agreement and the prospective purchasers
properly complete and execute the Subscription Agreement,
which has been provided as Exhibit (I-B) to the Partnership
Agreement, Exhibit (A) of the Prospectus, together with any
additional forms provided in any supplement or amendment to
the Prospectus, or otherwise provided to you by the Managing
General Partner to be completed by prospective purchasers.
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The Managing General Partner shall have the right to reject
any subscription at any time for any reason without liability
to it. Subscription funds and executed Subscription Agreements
shall be transmitted as set forth in Section 16 of this
Agreement.
(l) Although not anticipated, if you assist in any transfers of
the Units, then you shall comply, and you shall require any
Selling Agent to comply, with the requirements of Rule
2810(b)(2)(B) and (b)(3)(D) of the NASD Conduct Rules.
(m) You agree and covenant that the representations and warranties
you make in this Agreement are and shall be true and correct
at the applicable closing date, and you shall have fulfilled
all your obligations under this Agreement at the applicable
closing date.
7. State Securities Registration. Incident to the offer and sale of the
Units, the Managing General Partner shall use its best efforts either
in taking:
(a) all necessary action and filing all necessary forms and
documents deemed reasonable by it in order to qualify or
register Units for sale under the securities laws of the
states requested by you pursuant to Section 6(f) of this
Agreement; or
(b) any necessary action and filing any necessary forms deemed
reasonable by it in order to obtain an exemption from
qualification or registration in those states.
Notwithstanding, the Managing General Partner may elect not to qualify
or register Units in any state or jurisdiction in which it deems the
qualification or registration is not warranted for any reason in its
sole discretion. The Managing General Partner and its counsel shall
inform you as to the states and jurisdictions in which the Units have
been qualified for sale or are exempt under the respective securities
or Blue Sky laws of those states and jurisdictions. The Managing
General Partner, however, has not assumed and will not assume any
obligation or responsibility as to your right or any Selling Agent's
right to act as a broker/dealer with respect to the Units in any state
or jurisdiction.
The Managing General Partner shall provide to you and the Selling
Agents for delivery to all offerees and purchasers and their
representatives any additional information, documents, and instruments
that the Managing General Partner deems necessary to comply with the
rules, regulations, and judicial and administrative interpretations in
those states and jurisdictions for the offer and sale of the Units in
these states. The Managing General Partner shall file all post-offering
forms, documents, or materials and take all other actions required by
the states and jurisdictions in which the offer and sale of Units have
been qualified, registered, or are exempt. However, the Managing
General Partner shall not be required to take any action, make any
filing, or prepare any document necessary or required in connection
with your status or any Selling Agent's status as a broker/dealer under
the laws of any state or jurisdiction.
The Managing General Partner shall provide you with copies of all
applications, filings, correspondence, orders, other documents, or
instruments relating to any application for qualification,
registration, exemption, or other approval under applicable state or
Federal securities laws for the offering.
8. Expense of Sale. The expenses in connection with the offer and sale of
the Units shall be payable as set forth below.
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Dealer-Manager Agreement
(a) The Managing General Partner shall pay all expenses incident
to the performance of its obligations under this Agreement,
including the fees and expenses of its attorneys and
accountants and all fees and expenses of registering or
qualifying the Units for offer and sale in the states and
jurisdictions as set forth in Section 7 of this Agreement, or
obtaining exemptions from qualification or registration, even
if this offering is not successfully completed.
(b) You shall pay all expenses incident to the performance of your
obligations under this Agreement, including the formation and
management of the selling group and the fees and expenses of
your own counsel and accountants, even if this offering is not
successfully completed.
9. Conditions of the Dealer-Manager's Duties. Your obligations under this
Agreement shall be subject to the accuracy, as of the date of this
Agreement and at the applicable closing date of the Managing General
Partner's representations and warranties made in this Agreement, and to
the performance by the Managing General Partner of its obligations
under this Agreement.
10. Conditions of the Managing General Partner's Duties. The Managing
General Partner's obligations provided under this Agreement, including
the duty to pay compensation to you as set forth in Section 4 of this
Agreement, shall be subject to the following:
(a) the accuracy, as of the date of this Agreement and at the
applicable closing date as if made at the applicable closing
date, of your representations and warranties made in this
Agreement;
(b) the performance by you of your obligations under this
Agreement; and
(c) the Managing General Partner's receipt, at or before the
applicable closing date, of a fully executed Subscription
Agreement for each prospective purchaser as required by
Section 6(k) of this Agreement.
11. Indemnification.
(a) You and the Selling Agents shall indemnify and hold harmless
the Managing General Partner, the Partnership and its
attorneys against any losses, claims, damages or liabilities,
joint or several, to which they may become subject under the
Act, the Act of 1934, or otherwise insofar as the losses,
claims, damages, or liabilities (or actions in respect
thereof) arise out of or are based on your agreements with the
Selling Agents or your breach of any of your duties and
obligations, representations, or warranties under the terms or
provisions of this Agreement, and you and the Selling Agents
shall reimburse them for any legal or other expenses
reasonably incurred in connection with investigating or
defending the losses, claims, damages, liabilities, or
actions.
(b) The Managing General Partner shall indemnify and hold you and
the Selling Agents harmless against any losses, claims,
damages or liabilities, joint or several, to which you and the
Selling Agents may become subject under the Act, the Act of
1934, or otherwise insofar as the losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or
are based on the Managing General Partner's breach of any of
its duties and obligations, representations, or warranties
under the terms or provisions of this Agreement, and the
Managing General Partner shall reimburse you and the Selling
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Agents for any legal or other expenses reasonably incurred in
connection with investigating or defending the losses, claims,
damages, liabilities, or actions.
(c) The foregoing indemnity agreements shall extend on the same
terms and conditions to, and shall inure to the benefit of,
each person, if any, who controls each indemnified party
within the meaning of the Act.
(d) Promptly after receipt by an indemnified party of notice of
the commencement of any action, the indemnified party shall,
if a claim in respect of the action is to be made against an
indemnifying party under this Section, notify the indemnifying
party in writing of the commencement of the action; but the
omission to promptly notify the indemnifying party shall not
relieve the indemnifying party from any liability which it may
have to any indemnified party. If any action is brought
against an indemnified party, it shall notify the indemnifying
party of the commencement of the action, and the indemnifying
party shall be entitled to participate in, and, to the extent
that it wishes, jointly with any other indemnifying party
similarly notified, to assume the defense of the action, with
counsel satisfactory to the indemnified and indemnifying
parties. After the indemnified party has received notice from
the agreed on counsel that the defense of the action under
this paragraph has been assumed, the indemnifying party shall
not be responsible for any legal or other expenses
subsequently incurred by the indemnified party in connection
with the defense of the action other than with respect to the
agreed on counsel who assumed the defense of the action.
12. Representations and Agreements to Survive Delivery. All
representations, warranties, and agreements of the Managing General
Partner and you in this Agreement, including the indemnity agreements
contained in Section 11 of this Agreement, shall:
(a) survive the delivery, execution and closing of this Agreement;
and
(b) remain operative and in full force and effect regardless of
any investigation made by or on behalf of you or any person
who controls you within the meaning of the Act, by the
Managing General Partner, or any of its officers, directors,
or any person who controls the Managing General Partner within
the meaning of the Act, or any other indemnified party; and
(c) survive delivery of the Units.
13. Termination.
(a) You shall have the right to terminate this Agreement other
than the indemnification provisions of Section 11 of this
Agreement by giving notice as specified below any time at or
before a closing date:
(i) if the Managing General Partner has failed, refused,
or been unable at or before a closing date, to
perform any of its obligations under this Agreement;
or
(ii) there has occurred an event materially and adversely
affecting the value of the Units.
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If you elect to terminate this Agreement other than the indemnification
provisions of Section 11 of this Agreement, then the Managing General
Partner shall be promptly notified by you by telephone, e-mail,
facsimile, or telegram, confirmed by letter.
(b) The Managing General Partner may terminate this Agreement
other than the indemnification provisions of Section 11 of
this Agreement, for any reason and at any time, by promptly
giving notice to you by telephone, e-mail, facsimile, or
telegram, confirmed by letter as specified below at or before
a closing date.
14. Notices.
(a) All notices or communications under this Agreement, except as
otherwise specifically provided, shall be in writing.
(b) Any notice or communication sent by the Managing General
Partner to you shall be mailed, delivered, or sent by
facsimile, e-mail or telegraph, and confirmed to you at 000
Xxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000.
(c) Any notice or communication sent by you to the Managing
General Partner or the Partnership shall be mailed, delivered,
or sent by facsimile, e-mail or telegraph, and confirmed at
000 Xxxxxx Xxxx, Xxxx Xxxxxxxx, Xxxxxxxxxxxx 00000.
15. Format of Checks/Escrow Agent. Pending receipt of the minimum
subscription proceeds of $1,000,000 as set forth in Section 4(d) of
this Agreement, the Managing General Partner and you and the Selling
Agents, including customer carrying broker/dealers, agree that all
subscribers shall be instructed to make their checks, drafts, or money
orders payable solely to "Atlas Public #11-2002 Ltd., Escrow Agent, PNC
Bank," as agent for the Partnership, and you agree and shall require
the Selling Agents, including customer carrying broker/dealers, to
agree to comply with Rule 15c2-4 adopted under the Act of 1934.
If you receive a check, draft, or money order not conforming to the
foregoing instructions, then you shall return the check, draft, or
money order to the Selling Agent not later than the end of the next
business day following its receipt by you. The Selling Agent shall then
return the check, draft, or money order directly to the subscriber not
later than the end of the next business day following its receipt from
you. Checks, drafts, or money orders received by you or a Selling Agent
which conform to the foregoing instructions shall be transmitted by you
under Section 16 "Transmittal Procedures," below.
You represent that you have executed the Escrow Agreement for the
Partnership and agree that you are bound by the terms of the Escrow
Agreement executed by you, the Partnership, and the Managing General
Partner, a copy of which is attached to this Agreement as Exhibit "A."
16. Transmittal Procedures. You and each Selling Agent, including customer
carrying broker/dealers, shall transmit received investor funds in
accordance with the following procedures. For purposes of the
following, the term "Selling Agent" shall also include you as
Dealer-Manager when you receive subscriptions from investors.
(a) Pending receipt of the minimum subscription proceeds of
$1,000,000 as set forth in Section 4(d) of this Agreement, the
Selling Agents on receipt of any check, draft, and money order
from a subscriber shall promptly transmit the check, draft,
and money order
Xxxxx Funding, Inc. 12
Dealer-Manager Agreement
and the original executed Subscription Agreement to you, as
Dealer-Manager, by the end of the next business day following
receipt of the check, draft, or money order by the Selling
Agent. By the end of the next business day following your
receipt of the check, draft, or money order and the original
executed Subscription Agreement, you, as Dealer-Manager, shall
transmit the check, draft, or money order and a copy of the
executed Subscription Agreement to the Escrow Agent, and the
original executed Subscription Agreement and a copy of the
check, draft, or money order to the Managing General Partner.
(b) On receipt by you, as Dealer-Manager, of notice from the
Managing General Partner that the minimum subscription
proceeds of $1,000,000 as set forth in Section 4(d) of this
Agreement have been received, the Managing General Partner,
you, and the Selling Agents agree that all subscribers then
may be instructed, in the Managing General Partner's sole
discretion, to make their checks, drafts, or money orders
payable solely to "Atlas Public #11-2002 Ltd."
Thereafter, the Selling Agents shall promptly transmit any and
all checks, drafts, and money orders received from subscribers
and the original executed Subscription Agreement to you, as
Dealer-Manager, by the end of the next business day following
receipt of the check, draft, or money order by the Selling
Agent. By the end of the next business day following your
receipt of the check, draft, or money order and the original
executed Subscription Agreement, you, as Dealer-Manager, shall
transmit the check, draft or money order and the original
executed Subscription Agreement to the Managing General
Partner.
17. Parties. This Agreement shall inure to the benefit of and be binding on
you, the Managing General Partner, and any respective successors and
assigns. This Agreement shall also inure to the benefit of the
indemnified parties, their successors and assigns. This Agreement is
intended to be and is for the sole and exclusive benefit of the parties
to this Agreement, including the Partnership, and their respective
successors and assigns, and the indemnified parties and their
successors and assigns, and for the benefit of no other person. No
other person shall have any legal or equitable right, remedy or claim
under or in respect of this Agreement. No purchaser of any of the Units
from you or a Selling Agent shall be construed a successor or assign
merely by reason of the purchase.
18. Relationship. This Agreement shall not constitute you a partner of the
Managing General Partner, the Partnership, or any general partner of
the Partnership, nor render the Managing General Partner, the
Partnership, or any general partner of the Partnership liable for any
of your obligations.
19. Effective Date. This Agreement is made effective between the parties as
of the date accepted by you as indicated by your signature to this
Agreement.
20. Entire Agreement, Waiver.
(a) This Agreement constitutes the entire agreement between the
Managing General Partner and you, and shall not be amended or
modified in any way except by subsequent agreement executed in
writing. Neither party to this Agreement shall be liable or
bound to the other by any agreement except as specifically set
forth in this Agreement.
Xxxxx Funding, Inc. 13
Dealer-Manager Agreement
(b) The Managing General Partner and you may waive, but only in
writing, any term, condition, or requirement under this
Agreement that is intended for its benefit. However, any
written waiver of any term or condition of this Agreement
shall not operate as a waiver of any other breach of that term
or condition of this Agreement. Also, any failure to enforce
any provision of this Agreement shall not operate as a waiver
of that provision or any other provision of this Agreement.
21. Complaints. The Managing General Partner and you, as Dealer-Manager,
agree as follows:
(a) to notify the other if either receives an investor complaint
in connection with the offer or sale of Units by you or a
Selling Agent;
(b) to cooperate with the other in resolving the complaint; and
(c) to cooperate in any regulatory examination of the other to the
extent it involves this Agreement or the offer or sale of
Units by you or a Selling Agent.
22. Privacy. The Managing General Partner and you each acknowledge that
certain information made available to the other under this Agreement
may be deemed nonpublic personal information under the
Xxxxx-Xxxxx-Xxxxxx Act, other federal or state privacy laws (as
amended), and the rules and regulations promulgated thereunder, which
are referred to collectively, as the "Privacy Laws." The Managing
General Partner and you agree as follows:
(a) not to disclose or use the information except as required to
carry out each party's respective duties under this Agreement
or as otherwise permitted by law in the ordinary course of
business;
(b) to establish and maintain procedures reasonably designated to
assure the security and privacy of all the information; and
(c) to cooperate with the other and provide reasonable assistance
in ensuring compliance with the Privacy Laws to the extent
applicable to either or both the Managing General Partner and
you.
Very truly yours,
MANAGING GENERAL PARTNER
ATLAS RESOURCES, INC.,
a Pennsylvania corporation
, 2002 By:
-------------------------------- -------------------------------------------------
Date Xxxx X. Xxxxxxxxx, Senior Vice President - Direct
Participation Programs
PARTNERSHIP
ATLAS AMERICA PUBLIC #11-2002 LTD.
Xxxxx Funding, Inc. 14
Dealer-Manager Agreement
By: Atlas Resources, Inc.,
Managing General Partner
, 2002 By:
-------------------------------- -------------------------------------------------
Date Xxxx X. Xxxxxxxxx, Senior Vice President - Direct
Participation Programs
DEALER-MANAGER
XXXXX FUNDING, INC.,
a Pennsylvania corporation
, 2002 By:
-------------------------------- -------------------------------------------------
Date Xxxxxxx X. Xxxxx, Xx., President
Xxxxx Funding, Inc. 15
Dealer-Manager Agreement
EXHIBIT "A"
ATLAS AMERICA PUBLIC #11-2002 LTD.
ESCROW AGREEMENT
THIS AGREEMENT is made to be effective as of June ______, 2002, by and
among Atlas Resources, Inc., a Pennsylvania corporation (the "Managing General
Partner"), Anthem Securities, Inc., a Pennsylvania corporation ("Anthem"), Xxxxx
Funding, Inc., a Pennsylvania corporation ("Xxxxx Funding"), collectively Anthem
and Xxxxx Funding are referred to as the "Dealer-Manager," Atlas America Public
#11-2002 Ltd., a Delaware limited partnership (the "Partnership") and PNC Bank,
Pittsburgh, Pennsylvania, as escrow agent (the "Escrow Agent").
WITNESSETH:
WHEREAS, the Managing General Partner intends to offer publicly for
sale to qualified investors (the "Investors") up to 4,000 limited partnership
interests in the Partnership (the "Units").
WHEREAS, each Investor will be required to pay his subscription in full
on subscribing by check, draft, or money order (the "Subscription Proceeds").
WHEREAS, the cost per Unit will be $10,000 subject to certain discounts
of up to 10.5% ($1,050 per Unit) for sales to the Managing General Partner, its
officers, directors and affiliates, registered investment advisors and their
clients, Selling Agents and their registered representatives and principals, and
investors who buy Units through the officers and directors of the Managing
General Partner. Also, the Managing General Partner, in its discretion, may
accept one-half Unit ($5,000) subscriptions, with larger subscriptions permitted
in $1,000 increments.
WHEREAS, the Managing General Partner and Anthem have executed an
agreement ("Anthem Dealer-Manager Agreement") under which Anthem will solicit
subscriptions for Units in all states other than Minnesota and New Hampshire on
a "best efforts" "all or none" basis for Subscription Proceeds of $1,000,000 and
on a "best efforts" basis for the remaining Units on behalf of the Managing
General Partner and the Partnership and under which Anthem has been authorized
to select certain members in good standing of the National Association of
Securities Dealers, Inc. ("NASD") to participate in the offering of the Units
("Selling Agents").
WHEREAS, the Managing General Partner and Xxxxx Funding have executed
an agreement ("Xxxxx Funding Dealer-Manager Agreement") under which Xxxxx
Funding will solicit subscriptions for Units in the states of Minnesota and New
Hampshire on a "best efforts" "all or none" basis for Subscription Proceeds of
$1,000,000 and on a "best efforts" basis for the remaining Units on behalf of
the Managing General Partner and the Partnership and under which Xxxxx Funding
has been authorized to select certain members in good standing of the NASD to
participate in the offering of the Units ("Selling Agents").
WHEREAS, the Anthem Dealer-Manager Agreement and the Xxxxx Funding
Dealer-Manager Agreement, collectively referred to as the "Dealer-Manager
Agreement," provide for compensation to the Dealer-Manager to participate in the
offering of the Units, subject to the discounts set forth above for certain
Investors, which compensation includes, but is not limited to, for each Unit
sold:
1
o a 2.5% Dealer-Manager fee;
o a 7% sales commission;
o a .5% nonaccountable reimbursement of marketing expenses; and
o a .5% reimbursement of the Selling Agents' bona fide accountable
due diligence expenses;
all or a portion of which will be reallowed to the Selling Agents and
wholesalers.
WHEREAS, under the terms of the Dealer-Manager Agreement the
Subscription Proceeds are required to be held in escrow subject to the receipt
and acceptance by the Managing General Partner of the minimum Subscription
Proceeds of $1,000,000, excluding any optional subscription by the Managing
General Partner, its officers, directors, and Affiliates.
WHEREAS, the Units may also be offered and sold by the officers and
directors of the Managing General Partner without receiving a sales commission
or other compensation on their sales.
WHEREAS, no subscriptions to the Partnership will be accepted after the
"Offering Termination Date," which is the first to occur of either:
o receipt of the maximum Subscription Proceeds of $40,000,000; or
o December 31, 2002.
WHEREAS, to facilitate compliance with the terms of the Dealer-Manager
Agreement and Rule 15c2-4 adopted under the Securities Exchange Act of 1934, the
Managing General Partner and the Dealer-Manager desire to have the Subscription
Proceeds deposited with the Escrow Agent and the Escrow Agent agrees to hold the
Subscription Proceeds under the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained in this Agreement, the parties to this Agreement, intending to be
legally bound, agree as follows:
1. Appointment of Escrow Agent. The Managing General Partner, the
Partnership, and the Dealer-Manager appoint the Escrow Agent as the
escrow agent to receive and to hold the Subscription Proceeds deposited
with the Escrow Agent by the Dealer-Manager and the Managing General
Partner under this Agreement, and the Escrow Agent agrees to serve in
this capacity during the term and based on the provisions of this
Agreement.
2. Deposit of Subscription Proceeds. Pending receipt of the minimum
Subscription Proceeds of $1,000,000, the Dealer-Manager and the
Managing General Partner shall deposit the Subscription Proceeds of
each Investor to whom they sell Units with the Escrow Agent and shall
deliver to the Escrow Agent a copy of the Subscription Agreement of the
Investor. Payment for each subscription for Units shall be in the form
of a check made payable to "Atlas America Public #11-2002 Ltd., Escrow
Agent, PNC Bank." The Escrow Agent shall deliver a receipt to either:
(a) Anthem and the Managing General Partner for each deposit of
Subscription Proceeds made under this Agreement by Anthem;
Escrow Agreement 2
(b) Xxxxx Funding and the Managing General Partner for each
deposit of Subscription Proceeds made under this Agreement by
Xxxxx Funding; or
(c) the Managing General Partner for each deposit of Subscription
Proceeds made under this Agreement by the Managing General
Partner.
3. Investment of Subscription Proceeds. The Subscription Proceeds shall be
deposited in an interest bearing account maintained by the Escrow
Agent. Subscription Proceeds may be temporarily invested by the Escrow
Agent only in income producing short-term, highly liquid investments
secured by the United States government where there is appropriate
safety of principal, such as U.S. Treasury Bills. The interest earned
shall be added to the Subscription Proceeds and disbursed in accordance
with the provisions of Paragraph 4 or 5 of this Agreement, as the case
may be.
4. Distribution of Subscription Proceeds. If the Escrow Agent:
(a) receives written notice from an authorized officer of the
Managing General Partner that at least the minimum
Subscription Proceeds of $1,000,000 have been received and
accepted by the Managing General Partner; and
(b) determines that Subscription Proceeds for at least $1,000,000
have cleared the banking system and are good;
then the Escrow Agent shall promptly release and distribute to the
Managing General Partner the escrowed Subscription Proceeds which have
cleared the banking system and are good plus any interest paid and
investment income earned on the Subscription Proceeds while held by the
Escrow Agent in the escrow account.
Any remaining Subscription Proceeds, plus any interest paid and
investment income earned on the Subscription Proceeds while held by the
Escrow Agent in the escrow account, shall be promptly released and
distributed to the Managing General Partner by the Escrow Agent as the
Subscription Proceeds clear the banking system and become good.
5. Separate Partnership Account. During the continuation of the offering
after the Partnership is funded with cleared Subscription Proceeds of
at least $1,000,000 and the Escrow Agent receives the notice described
in Paragraph 4 of this Agreement, and before the Offering Termination
Date, any additional Subscription Proceeds may be deposited by the
Dealer-Manager and the Managing General Partner directly in a separate
Partnership account which shall not be subject to the terms of this
Agreement.
6. Distributions to Subscribers.
(a) If the Partnership is not funded as contemplated because less
than the minimum Subscription Proceeds of $1,000,000 have been
received and accepted by the Managing General Partner by
twelve p.m. (noon), local time, on the Offering Termination
Date, or for any other reason, then the Managing General
Partner shall notify the Escrow Agent, and the Escrow Agent
promptly shall distribute to each Investor a refund check made
payable to the Investor in an amount equal to the Subscription
Proceeds of the Investor, plus any interest paid or investment
income earned on the Investor's Subscription Proceeds while
held by the Escrow Agent in the escrow account.
Escrow Agreement 3
(b) If a subscription for Units submitted by an Investor is
rejected by the Managing General Partner for any reason after
the Subscription Proceeds relating to the subscription have
been deposited with the Escrow Agent, then the Managing
General Partner promptly shall notify the Escrow Agent of the
rejection, and the Escrow Agent shall promptly distribute to
the Investor a refund check made payable to the Investor in an
amount equal to the Subscription Proceeds of the Investor,
plus any interest paid or investment income earned on the
Investor's Subscription Proceeds while held by the Escrow
Agent in the escrow account.
7. Compensation and Expenses of Escrow Agent. The Managing General Partner
shall be solely responsible for and shall pay the compensation of the
Escrow Agent for its services under this Agreement, as provided in
Appendix 1 to this Agreement and made a part of this Agreement, and the
charges, expenses (including any reasonable attorneys' fees), and other
out-of-pocket expenses incurred by the Escrow Agent in connection with
the administration of the provisions of this Agreement. The Escrow
Agent shall have no lien on the Subscription Proceeds deposited in the
escrow account unless and until the Partnership is funded with cleared
Subscription Proceeds of at least $1,000,000 and the Escrow Agent
receives the notice described in Paragraph 4 of this Agreement, at
which time the Escrow Agent shall have, and is granted, a prior lien on
any property, cash, or assets held under this Agreement, with respect
to its unpaid compensation and nonreimbursed expenses, superior to the
interests of any other persons or entities.
8. Duties of Escrow Agent. The Escrow Agent shall not be obligated to
accept any notice, make any delivery, or take any other action under
this Agreement unless the notice or request or demand for delivery or
other action is in writing and given or made by the party given the
right or charged with the obligation under this Agreement to give the
notice or to make the request or demand. In no event shall the Escrow
Agent be obligated to accept any notice, request, or demand from anyone
other than the Managing General Partner or the Dealer-Manager.
9. Liability of Escrow Agent. The Escrow Agent shall not be liable for any
damages, or have any obligations other than the duties prescribed in
this Agreement in carrying out or executing the purposes and intent of
this Agreement. However, nothing in this Agreement shall relieve the
Escrow Agent from liability arising out of its own willful misconduct
or gross negligence. The Escrow Agent's duties and obligations under
this Agreement shall be entirely administrative and not discretionary.
The Escrow Agent shall not be liable to any party to this Agreement or
to any third-party as a result of any action or omission taken or made
by the Escrow Agent in good faith. The parties to this Agreement will
indemnify the Escrow Agent, hold the Escrow Agent harmless, and
reimburse the Escrow Agent from, against and for, any and all
liabilities, costs, fees and expenses (including reasonable attorney's
fees) the Escrow Agent may suffer or incur by reason of its execution
and performance of this Agreement. If any legal questions arise
concerning the Escrow Agent's duties and obligations under this
Agreement, then the Escrow Agent may consult with its counsel and rely
without liability on written opinions given to it by its counsel.
The Escrow Agent shall be protected in acting on any written notice,
request, waiver, consent, authorization, or other paper or document
which the Escrow Agent, in good faith, believes to be genuine and what
it purports to be.
If there is any disagreement between any of the parties to this
Agreement, or between them or any other person, resulting in adverse
claims or demands being made in connection with this Agreement, or if
the Escrow Agent, in good faith, is in doubt as to what action it
should take under this Agreement, then the Escrow Agent may, at its
option, refuse to comply with any claims or demands
Escrow Agreement 4
on it or refuse to take any other action under this Agreement, so long
as the disagreement continues or the doubt exists. In any such event,
the Escrow Agent shall not be or become liable in any way or to any
person for its failure or refusal to act and the Escrow Agent shall be
entitled to continue to so refrain from acting until the dispute is
resolved by the parties involved.
PNC Bank is acting solely as the Escrow Agent and is not a party to,
nor has it reviewed or approved any agreement or matter of background
related to this Agreement, other than this Agreement itself, and has
assumed, without investigation, the authority of the individuals
executing this Agreement to be so authorized on behalf of the party or
parties involved.
10. Resignation or Removal of Escrow Agent. The Escrow Agent may resign as
such after giving thirty days' prior written notice to the other
parties to this Agreement. Similarly, the Escrow Agent may be removed
and replaced after giving thirty days' prior written notice to the
Escrow Agent by the other parties to this Agreement. In either event,
the duties of the Escrow Agent shall terminate thirty days after the
date of the notice (or as of an earlier date as may be mutually
agreeable); and the Escrow Agent shall then deliver the balance of the
Subscription Proceeds (and any interest paid or investment income
earned thereon while held by the Escrow Agent in the escrow account) in
its possession to a successor escrow agent appointed by the other
parties to this Agreement as evidenced by a written notice filed with
the Escrow Agent.
If the other parties to this Agreement are unable to agree on a
successor escrow agent or fail to appoint a successor escrow agent
before the expiration of thirty days following the date of the notice
of the Escrow Agent's resignation or removal, then the Escrow Agent may
petition any court of competent jurisdiction for the appointment of a
successor escrow agent or other appropriate relief. Any resulting
appointment shall be binding on all of the parties to this Agreement.
On acknowledgment by any successor escrow agent of the receipt of the
then remaining balance of the Subscription Proceeds (and any interest
paid or investment income earned thereon while held by the Escrow Agent
in the escrow account), the Escrow Agent shall be fully released and
relieved of all duties, responsibilities, and obligations under this
Agreement.
11. Termination. This Agreement shall terminate and the Escrow Agent shall
have no further obligation with respect to this Agreement after the
distribution of all Subscription Proceeds (and any interest paid or
investment income earned thereon while held by the Escrow Agent in the
escrow account) as contemplated by this Agreement or on the written
consent of all the parties to this Agreement.
12. Notice. Any notices or instructions, or both, to be given under this
Agreement shall be validly given if set forth in writing and mailed by
certified mail, return receipt requested, as follows:
If to the Escrow Agent:
PNC Bank
__________________________________
__________________________________
Attention: __________________________
Phone: ____________________
Facsimile: __________________
Escrow Agreement 5
Escrow Agreement 6
If to the Managing General Partner:
Atlas Resources, Inc.
000 Xxxxxx Xxxx
X.X. Xxx 000
Xxxx Xxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxxx
Phone: (000) 000-0000
Facsimile: (000) 000-0000
If to Anthem:
Anthem Securities, Inc.
000 Xxxxxx Xxxx
X.X. Xxx 000
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxx
Phone: (000) 000-0000
Facsimile: (000) 000-0000
If to Xxxxx Funding:
Xxxxx Funding, Inc.
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Xx.
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Any party may designate any other address to which notices and
instructions shall be sent by notice duly given in accordance with this
Agreement.
13. Miscellaneous.
(a) This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania.
(b) This Agreement shall be binding on and shall inure to the
benefit of the undersigned and their respective successors and
assigns.
(c) This Agreement may be executed in multiple copies, each
executed copy to serve as an original.
Escrow Agreement 7
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be
effective as of the day and year first above written.
PNC BANK
As Escrow Agent
By:
-------------------------------------------------
(Authorized Officer)
ATLAS RESOURCES, INC.
A Pennsylvania corporation
By:
-------------------------------------------------
Xxxx X. Xxxxxxxxx, Senior Vice President - Direct
Participation Programs
ANTHEM SECURITIES, INC.
A Pennsylvania corporation
By: _______________________________________
Xxxx X. Xxxxxx, President
XXXXX FUNDING, INC.
A Pennsylvania corporation
By:
-------------------------------------------------
Xxxxxxx X. Xxxxx, Xx., President
ATLAS AMERICA PUBLIC #11-2002 LTD.
By: ATLAS RESOURCES, INC.
Managing General Partner
By:
-------------------------------------------------
Xxxx X. Xxxxxxxxx, Senior Vice President - Direct
Participation Programs
Escrow Agreement 8
APPENDIX I TO ESCROW AGREEMENT
Compensation for Services of Escrow Agent
Escrow Agent annual fee per year or any part thereof $____________
Escrow Agreement 9
EXHIBIT "B"
SELLING AGENT AGREEMENT
WITH XXXXX FUNDING, INC.
TO:
-------------------------------------------------------
RE: ATLAS AMERICA PUBLIC #11-2002 LTD.
----------------------------------
Gentlemen:
Atlas Resources, Inc. is the Managing General Partner in a Delaware
limited partnership named Atlas America Public #11-2002 Ltd., which is referred
to as the "Partnership." The Units in the Partnership, which are referred to as
the "Units," and the offering are described in the enclosed Prospectus dated
__________________, 2002, which is referred to as the "Prospectus." Prospectuses
relating to the Units have been furnished to you with this Agreement.
Our firm, Xxxxx Funding, Inc., which is referred to as the
"Dealer-Manager," has entered into a Dealer-Manager Agreement for sales in the
states of Minnesota and New Hampshire, a copy of which has been furnished to you
and is incorporated in this Agreement by reference, with the Managing General
Partner and the Partnership under which the Dealer-Manager has agreed to form a
group of NASD member firms, which are referred to as the "Selling Agents." The
Selling Agents will obtain subscriptions for Units in the states of:
o Minnesota; and
o New Hampshire
on a "best efforts" basis under the Securities Act of 1933, as amended, which is
referred to as the "Act" and the provisions of the Prospectus.
You are invited to become one of the Selling Agents on a non-exclusive
basis. By your acceptance below you agree to act in that capacity and to use
your best efforts, in accordance with the terms and conditions of this
Agreement, to solicit subscriptions in the states of:
o Minnesota; and
o New Hampshire.
This Agreement, however, shall not be construed to prohibit your participation
as a selling agent in states other than Minnesota and New Hampshire under a duly
executed selling agent agreement entered into by you and any other authorized
"Dealer-Manager" for the Partnership.
1. Representations and Warranties of Selling Agent. You represent and
warrant to the Dealer-Manager that:
(a) You are a corporation duly organized, validly existing, and in
good standing under the laws of the state of your formation or
of any jurisdiction to the laws of which you are
Xxxxx Funding, Inc. 1
Selling Agent Agreement
subject, with all requisite power and authority to enter into
this Agreement and to carry out your obligations under this
Agreement.
(b) This Agreement will be duly authorized, executed, and
delivered by you and will be a valid and binding agreement on
your part in accordance with its terms.
(c) The consummation of the transactions contemplated by this
Agreement and the Prospectus will not result in the following:
(i) any breach of any of the terms or conditions of, or
constitute a default under your Articles of
Incorporation or Bylaws, or any other indenture,
agreement, or other instrument to which you are a
party; or
(ii) any violation of any order applicable to you of any
court or any federal or state regulatory body or
administrative agency having jurisdiction over you or
over your affiliates.
(d) You are duly registered under the provisions of the Securities
Exchange Act of 1934, which is referred to as the "Act of
1934," as a dealer, and you are a member in good standing of
the NASD. You are duly registered as a broker/dealer in the
states where you are required to be registered in order to
carry out your obligations as contemplated by this Agreement
and the Prospectus. You agree to maintain all the foregoing
registrations in good standing throughout the term of the
offer and sale of the Units, and you agree to comply with all
statutes and other requirements applicable to you as a
broker/dealer under those registrations.
(e) Pursuant to your appointment as a Selling Agent, you shall
comply with all the provisions of the Act, insofar as the Act
applies to your activities under this Agreement. Further, you
shall not engage in any activity which would cause the offer
and/or sale of the Units not to comply with the Act, the Act
of 1934, the applicable rules and regulations of the
Securities and Exchange Commission, which is referred to as
the "Commission," the applicable state securities laws and
regulations, this Agreement, and the NASD Conduct Rules
including Rules 2420, 2730, 2740, 2750, and 2810(b)(2) and
(b)(3), which provide as follows:
Sec. (b)(2)
Suitability
(A) A member or person associated with a member
shall not underwrite or participate in a
public offering of a direct participation
program unless standards of suitability have
been established by the program for
participants therein and such standards are
fully disclosed in the prospectus and are
consistent with the provisions of
subparagraph (B) of this section.
(B) In recommending to a participant the
purchase, sale or exchange of an interest in
a direct participation program, a member or
person associated with a member shall:
(i) have reasonable grounds to believe,
on the basis of information obtained
from the participant concerning his
investment objectives, other
investments, financial
Xxxxx Funding, Inc. 2
Selling Agent Agreement
situation and needs, and any other
information known by the member or
associated person, that:
(a) the participant is or will
be in a financial position
appropriate to enable him
to realize to a significant
extent the benefits
described in the
prospectus, including the
tax benefits where they are
a significant aspect of the
program;
(b) the participant has a fair
market net worth sufficient
to sustain the risks
inherent in the program,
including loss of
investment and lack of
liquidity; and
(c) the program is otherwise
suitable for the
participant; and
(ii) maintain in the files of the member
documents disclosing the basis upon
which the determination of
suitability was reached as to each
participant.
(C) Notwithstanding the provisions of
subparagraphs (A) and (B) hereof, no member
shall execute any transaction in a direct
participation program in a discretionary
account without prior written approval of
the transaction by the customer.
Sec. (b)(3)
Disclosure
(A) Prior to participating in a public offering
of a direct participation program, a member
or person associated with a member shall
have reasonable grounds to believe, based on
information made available to him by the
sponsor through a prospectus or other
materials, that all material facts are
adequately and accurately disclosed and
provide a basis for evaluating the program.
(B) In determining the adequacy of disclosed
facts pursuant to subparagraph (A) hereof, a
member or person associated with a member
shall obtain information on material facts
relating at a minimum to the following, if
relevant in view of the nature of the
program:
(i) items of compensation;
(ii) physical properties;
(iii) tax aspects;
(iv) financial stability and experience
of the sponsor;
(v) the program's conflicts and risk
factors; and
(vi) appraisals and other pertinent
reports.
Xxxxx Funding, Inc. 3
Selling Agent Agreement
(C) For purposes of subparagraphs (A) and (B)
hereof, a member or person associated with a
member may rely upon the results of an
inquiry conducted by another member or
members, provided that:
(i) the member or person associated with
a member has reasonable grounds to
believe that such inquiry was
conducted with due care;
(ii) the results of the inquiry were
provided to the member or person
associated with a member with the
consent of the member or members
conducting or directing the inquiry;
and
(iii) no member that participated in the
inquiry is a sponsor of the program
or an affiliate of such sponsor.
(D) Prior to executing a purchase transaction in
a direct participation program, a member or
person associated with a member shall inform
the prospective participant of all pertinent
facts relating to the liquidity and
marketability of the program during the term
of investment.
(f) You shall not offer or sell the Units in any state until you
have been advised in writing by the Managing General Partner,
or the Managing General Partner's special counsel, that the
offer or sale of the Units:
(1) has been qualified in the state;
(2) is exempt from the qualification requirements imposed
by the state; or
(3) the qualification is otherwise not required.
(g) You have received copies of the Prospectus relating to the
Units and you have relied only on the statements contained in
the Prospectus and not on any other statements whatsoever,
either written or oral, with respect to the details of the
offering of Units.
(h) You agree that you shall not place any advertisement or other
solicitation with respect to the Units (including without
limitation any material for use in any newspaper, magazine,
radio or television commercial, telephone recording, motion
picture, or other public media) without the prior written
approval of the Managing General Partner, and without the
prior written approval of the form and content thereof by the
Commission, the NASD and the securities authorities of the
states where such advertisement or solicitation is to be
circulated. Any such advertisements or solicitations shall be
at your expense.
(i) If a supplement or amendment to the Prospectus is prepared and
delivered to you by the Managing General Partner or the
Dealer-Manager, you agree as follows:
(i) to distribute each supplement or amendment to the
Prospectus to every person who has previously
received a copy of the Prospectus from you; and
(ii) to include each supplement or amendment in all future
deliveries of any Prospectus.
Xxxxx Funding, Inc. 4
Selling Agent Agreement
(j) In connection with any offer or sale of the Units, you agree
to the following:
(i) to comply in all respects with statements set forth
in the Prospectus, the Partnership Agreement, and any
supplements or amendments to the Prospectus;
(ii) not to make any statement inconsistent with the
statements in the Prospectus, the Partnership
Agreement, and any supplements or amendments to the
Prospectus;
(iii) not to make any untrue or misleading statements of a
material fact in connection with the Units; and
(iv) not to provide any written information, statements,
or sales materials other than the Prospectus, the
Sales Literature, and any supplements or amendments
to the Prospectus unless approved in writing by the
Managing General Partner.
(k) You agree to use your best efforts in the solicitation and
sale of the Units, including that the prospective purchasers
meet the suitability requirements set forth in the Prospectus
and the Subscription Agreement and the prospective purchasers
properly complete and execute the Subscription Agreement,
which has been provided as Exhibit (I-B) to the Partnership
Agreement, Exhibit (A) of the Prospectus, together with any
additional forms provided in any supplement or amendment to
the Prospectus, or otherwise provided to you by the Managing
General Partner or the Dealer-Manager to be completed by
prospective purchasers.
The Managing General Partner shall have the right to reject
any subscription at any time for any reason without liability
to it. Subscription funds and executed subscription packets
shall be transmitted as set forth in Section 11 of this
Agreement.
(l) You shall comply with the requirements of Rules 2810(b)(2)(B)
and (b)(3)(D) of the NASD Conduct Rules.
(m) You agree and covenant that the representations and warranties
you make in this Agreement are and shall be true and correct
at the applicable closing date, and you shall and have
fulfilled all your obligations under this Agreement at the
applicable closing date.
2. Commissions.
(a) Subject to the receipt of the minimum required subscription
proceeds of $1,000,000 as described in Section 4(d) of the
Dealer-Manager Agreement, and the discounts set forth in
Section 4(c) of the Dealer-Manager Agreement for sales to the
following:
(i) the Managing General Partner, its officers, directors
and affiliates;
(ii) registered investment advisors and their clients;
(iii) Selling Agents and their registered representatives
and principals; and
(iv) investors who buy Units through the officers or
directors of the Managing General Partner;
Xxxxx Funding, Inc. 5
Selling Agent Agreement
the Dealer-Manager is entitled to receive from the Managing
General Partner a 7% Sales Commission, a .5% nonaccountable
marketing expense reimbursement, and a .5% reimbursement of
the Selling Agents' bona fide accountable due diligence
expenses per Unit, based on the aggregate amount of all Unit
subscriptions to the Partnership secured by the Dealer-Manager
or the selling group formed by the Dealer-Manager and accepted
by the Managing General Partner.
Subject to the terms and conditions set forth in this
Agreement, including the Dealer-Manager's receipt from you of
the documentation required of you in Section 1 of this
Agreement, the Dealer-Manager agrees to pay you a 7% Sales
Commission, a .5% reimbursement of your bona fide accountable
due diligence expenses and, subject to the performance by you
of your obligations under Appendix I to this Agreement, which
is incorporated in this Agreement by reference, a .5%
nonaccountable marketing expense reimbursement per Unit on
Units sold by you and accepted by the Managing General
Partner.
Your Sales Commissions, the .5% reimbursement of your bona
fide accountable due diligence expenses, and the .5%
nonaccountable marketing expense reimbursement, shall be paid
to you within seven business days after the Dealer-Manager has
received the Sales Commissions, the .5% reimbursement of your
bona fide accountable due diligence expenses, and the .5%
nonaccountable marketing expense reimbursement on the
subscriptions.
The Dealer-Manager is entitled to receive its Sales
Commissions, the .5% reimbursement of your bona fide
accountable due diligence expenses, and the .5% nonaccountable
marketing expense reimbursement within five business days
after the conditions described in Section 4(e) of the
Dealer-Manager Agreement are satisfied and approximately every
two weeks thereafter until the Offering Termination Date,
which is the earlier of:
(i) receipt of the maximum subscriptions of $40,000,000;
or
(ii) December 31, 2002;
as described in Section 1 of the Dealer-Manager Agreement. The
balance shall be paid to the Dealer-Manager within fourteen
business days after the Offering Termination Date.
(b) Notwithstanding anything in this Agreement to the contrary,
you agree to waive payment of your Sales Commissions, the .5%
nonaccountable marketing expense reimbursement, and the .5%
reimbursement of your bona fide accountable due diligence
expenses as set forth above in (a) above, until the
Dealer-Manager is in receipt of the related amounts owed to it
under the Dealer-Manager Agreement, and the Dealer-Manager's
liability to pay your compensation under this Agreement shall
be limited solely to the proceeds of the related amounts owed
to it under the Dealer-Manager Agreement.
(c) As provided in Section 4(d) of the Dealer-Manager Agreement,
the Partnership shall not begin operations unless it receives
subscription proceeds for at least $1,000,000 by December 31,
2002. If this amount is not secured by this date, then nothing
shall be payable to you and all funds advanced by subscribers
for Units shall be returned to them with interest earned, if
any.
Xxxxx Funding, Inc. 6
Selling Agent Agreement
3. Blue Sky Qualification. The Managing General Partner may elect not to
qualify or register Units in any state or jurisdiction in which it
deems the qualification or registration is not warranted for any reason
in its sole discretion. On application to the Dealer-Manager you will
be informed as to the states and jurisdictions in which the Units have
been qualified for sale or are exempt under the respective securities
or "Blue Sky" laws of those states and jurisdictions.
Notwithstanding the foregoing, the Dealer-Manager, the Partnership, and
the Managing General Partner have not assumed and will not assume any
obligation or responsibility as to your right to act as a broker/dealer
with respect to the Units in any state or jurisdiction.
4. Expense of Sale. The expenses in connection with the offer and sale of
the Units shall be payable as set forth below.
(a) The Dealer-Manager shall pay all expenses incident to the
performance of its obligations under this Agreement, including
the fees and expenses of its attorneys and accountants, even
if this offering is not successfully completed.
(b) You shall pay all expenses incident to the performance of your
obligations under this Agreement, including the fees and
expenses of your own counsel and accountants, even if this
offering is not successfully completed.
5. Conditions of Your Duties. Your obligations under this Agreement, as of
the date of this Agreement and at the applicable closing date, shall be
subject to the following:
(a) the performance by the Dealer-Manager of its obligations under
this Agreement; and
(b) the performance by the Managing General Partner of its
obligations under the Dealer-Manager Agreement.
6. Conditions of Dealer-Manager's Duties. The Dealer-Manager's obligations
under this Agreement, including the duty to pay compensation to you as
set forth in Section 2 of this Agreement, shall be subject to the
following:
(a) the accuracy, as of the date of this Agreement and at the
applicable closing date as if made at the applicable closing
date, of your representations and warranties made in this
Agreement;
(b) the performance by you of your obligations under this
Agreement; and
(c) the Dealer-Manager's receipt, at or before the applicable
closing date, of a fully executed Subscription Agreement for
each prospective purchaser as required by Section 1(k) of this
Agreement.
7. Indemnification.
(a) You shall indemnify and hold harmless the Dealer-Manager, the
Managing General Partner, the Partnership and its attorneys
against any losses, claims, damages or liabilities, joint or
several, to which they may become subject under the Act, the
Act of 1934, or otherwise insofar as the losses, claims,
damages, or liabilities (or actions in respect
Xxxxx Funding, Inc. 7
Selling Agent Agreement
thereof) arise out of or are based on your breach of any of
your duties and obligations, representations, or warranties
under the terms or provisions of this Agreement, and you shall
reimburse them for any legal or other expenses reasonably
incurred in connection with investigating or defending the
losses, claims, damages, liabilities, or actions.
(b) The Dealer-Manager shall indemnify and hold you harmless
against any losses, claims, damages, or liabilities, joint or
several, to which you may become subject under the Act, the
Act of 1934, or otherwise insofar as the losses, claims,
damages, or liabilities (or actions in respect thereof) arise
out of or are based on the Dealer-Manager's breach of any of
its duties and obligations, representations, or warranties
under the terms or provisions of this Agreement, and the
Dealer-Manager shall reimburse you for any legal or other
expenses reasonably incurred in connection with investigating
or defending the losses, claims, damages, liabilities, or
actions.
(c) The foregoing indemnity agreements shall extend on the same
terms and conditions to, and shall inure to the benefit of,
each person, if any, who controls each indemnified party
within the meaning of the Act.
(d) Promptly after receipt by an indemnified party of notice of
the commencement of any action, the indemnified party shall,
if a claim in respect of the action is to be made against the
indemnifying party under this Section, notify the indemnifying
party in writing of the commencement of the action; but the
omission to promptly notify the indemnifying party shall not
relieve the indemnifying party from any liability which it may
have to the indemnified party. If any action is brought
against an indemnified party, it shall notify the indemnifying
party of the commencement of the action, and the indemnifying
party shall be entitled to participate in, and, to the extent
that it wishes, jointly with any other indemnifying party
similarly notified, to assume the defense of the action, with
counsel satisfactory to the indemnified and indemnifying
parties. After the indemnified party has received notice from
the agreed on counsel that the defense of the action under
this paragraph has been assumed, the indemnifying party shall
not be responsible for any legal or other expenses
subsequently incurred by the indemnified party in connection
with the defense of the action other than with respect to the
agreed on counsel who assumed the defense of the action.
8. Representations and Agreements to Survive Delivery. All
representations, warranties, and agreements of the Dealer-Manager and
you in this Agreement, including the indemnity agreements contained in
Section 7 of this Agreement, shall:
(a) survive the delivery, execution and closing of this Agreement;
(b) remain operative and in full force and effect regardless of
any investigation made by or on behalf of you or any person
who controls you within the meaning of the Act, by the
Dealer-Manager, or any of its officers, directors or any
person who controls the Dealer-Manager within the meaning of
the Act, or any other indemnified party; and
(c) survive delivery of the Units.
Xxxxx Funding, Inc. 8
Selling Agent Agreement
9. Termination.
(a) You shall have the right to terminate this Agreement other
than the indemnification provisions of Section 7 of this
Agreement by giving notice as specified in Section 16 of this
Agreement any time at or before a closing date:
(i) if the Dealer-Manager has failed, refused, or been
unable at or before a closing date, to perform any of
its obligations under this Agreement; or
(ii) there has occurred an event materially and adversely
affecting the value of the Units.
If you elect to terminate this Agreement other than the indemnification
provisions of Section 7 of this Agreement, then the Dealer-Manager
shall be promptly notified by you by telephone, e-mail, facsimile, or
telegram, confirmed by letter.
(b) The Dealer-Manager may terminate this Agreement other than the
indemnification provisions of Section 7 of this Agreement, for
any reason and at any time, by promptly giving notice to you
by telephone, e-mail, facsimile or telegram, confirmed by
letter.
10. Format of Checks/Escrow Agent. Pending receipt of the minimum
subscription proceeds of $1,000,000 as set forth in Section 4(d) of the
Dealer-Manager Agreement, the Dealer-Manager and you, including if you
are a customer carrying broker/dealer, agree that all subscribers shall
be instructed to make their checks, drafts, or money orders payable
solely "Atlas Public #11-2002 Ltd., Escrow Agent, PNC Bank," as agent
for the Partnership, and you, including if you are a customer carrying
broker/dealer, agree to comply with Rule 15c2-4 adopted under the Act
of 1934.
If you receive a check, draft, or money order not conforming to the
foregoing instructions, then you shall return the check, draft, or
money order directly to the subscriber not later than the end of the
next business day following its receipt by you from the subscriber. If
the Dealer-Manager receives a check, draft, or money order not
conforming to the foregoing instructions, then the Dealer-Manager shall
return the check, draft, or money order to you not later than the end
of the next business day following its receipt by the Dealer-Manager
and you shall then return the check, draft, or money order directly to
the subscriber not later than the end of the next business day
following its receipt by you from the Dealer-Manager. Checks, drafts,
or money orders received by you which conform to the foregoing
instructions shall be transmitted by you under Section 11 "Transmittal
Procedures," below.
You agree that you are bound by the terms of the Escrow Agreement, a
copy of which is attached to the Dealer-Manager Agreement as Exhibit
"A."
11. Transmittal Procedures. You, including if you are a customer carrying
broker/dealer, shall transmit received investor funds in accordance
with the following procedures.
(a) Pending receipt of the minimum subscription proceeds of
$1,000,000 as set forth in Section 4(d) of the Dealer-Manager
Agreement, you shall promptly transmit, any and all checks,
drafts, and money orders received by you from subscribers and
the original executed Subscription Agreement to the
Dealer-Manager by the end of the next business day following
receipt of the check, draft, or money order by you. By the end
of the next business day following its receipt of the check,
draft, or money order and the original
Xxxxx Funding, Inc. 9
Selling Agent Agreement
executed subscription documents, the Dealer-Manager shall
transmit the check, draft, or money order and a copy of the
executed Subscription Agreement to the Escrow Agent, and the
original executed Subscription Agreement and a copy of the
check, draft, or money order to the Managing General Partner.
(b) On receipt by you of notice from the Managing General Partner
or the Dealer-Manager that the minimum subscription proceeds
of $1,000,000 as set forth in Section 4(d) of the
Dealer-Manager Agreement have been received, you agree that
all subscribers then may be instructed, in the Managing
General Partner's sole discretion, to make their checks,
drafts, or money orders payable solely "Atlas Public #11-2002
Ltd."
Thereafter, you shall promptly transmit any and all checks,
drafts, and money orders received by you from subscribers and
the original executed Subscription Agreement to the
Dealer-Manager by the end of the next business day following
receipt of the check, draft, or money order by you. By the end
of the next business day following its receipt of the check,
draft, or money order and original Subscription Agreement, the
Dealer-Manager shall transmit the check, draft, or money order
and the original executed Subscription Agreement to the
Managing General Partner.
12. Parties. This Agreement shall inure to the benefit of and be binding on
you, the Dealer-Manager, and any respective successors and assigns.
This Agreement shall also inure to the benefit of the indemnified
parties, their successors and assigns. This Agreement is intended to be
and is for the sole and exclusive benefit of the parties to this
Agreement, and their respective successors and assigns, and the
indemnified parties and their successors and assigns, and for the
benefit of no other person. No other person shall have any legal or
equitable right, remedy or claim under or in respect of this Agreement.
No purchaser of any of the Units from you shall be construed a
successor or assign merely by reason of the purchase.
13. Relationship. You are not authorized to hold yourself out as agent of
the Dealer-Manager, the Managing General Partner, the Partnership or
any other Selling Agent. This Agreement shall not constitute you a
partner of the Managing General Partner, the Dealer-Manager, the
Partnership, any general partner of the Partnership, or any other
Selling Agent, nor render the Managing General Partner, the
Dealer-Manager, the Partnership, any general partner of the
Partnership, or any other Selling Agent, liable for any of your
obligations.
14. Effective Date. This Agreement is made effective between the parties as
of the date accepted by you as indicated by your signature to this
Agreement.
15. Entire Agreement, Waiver.
(a) This Agreement constitutes the entire agreement between the
Dealer-Manager and you, and shall not be amended or modified
in any way except by subsequent agreement executed in writing.
Neither party to this Agreement shall be liable or bound to
the other by any agreement except as specifically set forth in
this Agreement.
(b) The Dealer-Manager and you may waive, but only in writing, any
term, condition, or requirement under this Agreement that is
intended for its benefit. However, any written waiver of any
term or condition of this Agreement shall not operate as a
waiver of any other breach of the term or condition of this
Agreement. Also, any failure to enforce any
Xxxxx Funding, Inc. 10
Selling Agent Agreement
provision of this Agreement shall not operate as a waiver of
that provision or any other provision of this Agreement.
16. Notices.
(a) Any communications from you shall be in writing addressed to
the Dealer-Manager at 000 Xxxxxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxxxxxx 00000.
(b) Any notice from the Dealer-Manager to you shall be deemed to
have been duly given if mailed, faxed or telegraphed to you at
your address shown below.
17. Complaints. The Dealer-Manager and you agree as follows:
(a) to notify the other if either receives an investor complaint
in connection with the offer or sale of Units by you;
(b) to cooperate with the other in resolving the complaint; and
(c) to cooperate in any regulatory examination of the other to the
extent it involves this Agreement or the offer or sale of
Units by you.
18. Privacy. The Dealer-Manager and you each acknowledge that certain
information made available to the other under this Agreement may be
deemed nonpublic personal information under the Xxxxx-Xxxxx-Xxxxxx Act,
other federal or state privacy laws (as amended), and the rules and
regulations promulgated thereunder, which are referred to collectively
as the "Privacy Laws." The Dealer-Manager and you agree as follows:
(a) not to disclose or use the information except as required to
carry out each party's respective duties under this Agreement
or as otherwise permitted by law in the ordinary course of
business;
(b) to establish and maintain procedures reasonably designated to
assure the security and privacy of all the information; and
(c) to cooperate with the other and provide reasonable assistance
in ensuring compliance with the Privacy Laws to the extent
applicable to either or both the Dealer-Manager and you.
19. Acceptance. Please confirm your agreement to become a Selling Agent
under the terms and conditions set forth above by signing and returning
the enclosed duplicate copy of this Agreement to us at the address set
forth above.
Sincerely,
, 2002 XXXXX FUNDING, INC.
--------------------------------------------
Date
ATTEST:
By:
------------------------------------------------- --------------------------------------------
(SEAL) Secretary Xxxxxxx X. Xxxxx, Xx., President
Xxxxx Funding, Inc. 11
Selling Agent Agreement
ACCEPTANCE:
We accept your invitation to become a Selling Agent under all the terms
and conditions stated in the above Agreement and confirm that all the statements
set forth in the above Agreement are true and correct. We hereby acknowledge
receipt of the Prospectuses and Sales Literature and a copy of the
Dealer-Manager Agreement referred to above.
, 2002 ,
-------------------------------------- ------------------------------------------------------------
Date a(n) ___________________________ corporation,
ATTEST:
By:
-------------------------------------------- ------------------------------------------------------
(SEAL) Secretary _____________________________, President
-------------------------------------------------------------
(Address)
-------------------------------------------------------------
-------------------------------------------------------------
Your CRD Number is
------------------------------------------
Your Tax ID Number is
---------------------------------------
Xxxxx Funding, Inc. 12
Selling Agent Agreement
APPENDIX I TO SELLING AGENT AGREEMENT
In consideration for the payment to you, as Selling Agent, by the Dealer-Manager
of a .5% nonaccountable marketing expense reimbursement as set forth in Section
2(a) of the Selling Agent Agreement, you warrant, represent, covenant, and agree
with the Dealer-Manager that you, as Selling Agent, shall do the following:
o prominently and promptly announce your participation in the
offering as Selling Agent to your registered representatives,
whether by newsletter, e-mail, mail or otherwise, which
announcement also shall advise your registered representatives to
contact our Regional Marketing Director in whose territory the
registered representative is located (the information concerning
our Regional Marketing Directors has been provided to you by
separate correspondence) with a copy of the announcement provided
concurrently to the Dealer-Manager; and
o provide the Dealer-Manager with the names, telephone numbers,
addresses and e-mail addresses of your registered representatives,
which information shall be kept confidential by the Dealer-Manager
and the Managing General Partner and shall not be used for any
purpose other than the marketing of the offering as set forth in
the Dealer-Manager Agreement and the Selling Agent Agreement.
Further, you, as Selling Agent, agree that the Dealer-Manager and
the Managing General Partner may directly contact your registered
representatives, in person or otherwise, to inform them of the
offering, explain the merits and risks of the offering, and
otherwise assist in your registered representatives' efforts to
solicit and sell Units.
Xxxxx Funding, Inc. 13
Selling Agent Agreement
