Exhibit 1.2
Form of Selected Dealer Agreement
SAGE, XXXXX & CO., INC.
0000 Xxxxxxxxx Xxxx
0xx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Date: _________, 2001
SELECTED DEALER AGREEMENT
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Dear Sirs:
Sage, Xxxxx & Co., Inc., the underwriter (the "Underwriter") named in the
Prospectus (as hereinafter defined) has agreed, subject to the terms and
conditions of that certain underwriting agreement (the "Underwriting Agreement")
dated ___________, 2001, between the Underwriter and Intervest Corporation of
New York (the "Issuer"), to act as exclusive agent for the Issuer and to use its
best efforts to sell an aggregate of $5,750,000 principal amount of Series
__/__/__ Subordinated Debentures (the "Debentures") of the Issuer, in three
maturities as follows: $1,250,000 with a maturity date of October 1, 2005;
$2,250,000 with a maturity date of October 1, 2007; and $2,250,000 with a
maturity date of October 1, 2009. The Debentures are more particularly described
in the enclosed prospectus (the "Prospectus"), additional copies of which will
be supplied in reasonable quantities upon request.
The Underwriter is offering a part of the Debentures for sale by selected
dealers (the "Selected Dealers"), including yourself, who are registered with
the Securities and Exchange Commission (the "SEC") as broker-dealers under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and who are
members in good standing of the National Association of Securities Dealers, Inc.
(the "NASD"), on a "best efforts" basis.
The offering is subject to the delivery of the Debentures, and the
acceptance of the offering by the Underwriter, the approval of all legal matters
by counsel, and the terms and conditions herein set forth.
Subject to the foregoing, the Underwriter confirms its agreement with you
(sometimes herein called the "Dealer"') as follows:
1. Non-Exclusive Right to Offer and Sell. Underwriter hereby grants to you
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the non-exclusive right to offer and sell the Debentures in such face amounts
and upon such terms as the Underwriter shall from time to time determine and as
set forth in the then effective Prospectus relating to such Debentures. The
amount and maturity of Debentures which the Underwriter has initially determined
to permit you to offer and sell is set forth at the end of this letter, although
the Underwriter reserves the right to change such allotment. You agree (a) upon
our request, to advise us of the number of Debentures allotted to you which
remain unsold; and (b) at our request, to stop offering any such Debentures
remaining unsold.
2. Compliance with Laws. A registration statement on Form S-11 (the
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"Registration Statement") with respect to the Debentures has been filed with the
SEC and has become effective. You agree to comply with the applicable
requirements of the Securities Act of 1933, as amended (the "1933 Act"), the
1934 Act and any applicable rules and regulations issued under said Acts. No
person is authorized by the Issuer or by the Underwriter to give any information
or to make any representation other than those contained in the Prospectus in
connection with the sale of the Debentures.
3. Dealer Representations. Dealer represents that it is a member in good
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standing of the NASD and agrees to abide by all of the NASD rules and
regulations, and any interpretations thereof, including, without limitation, the
NASD interpretation with respect to Free-Riding and Withholding (Rule IM-2110-1)
and Rules 2500 and 2700 of the NASD Conduct Rules. Dealer also agrees to comply
with the requirements of all applicable Federal and State Laws and all rules and
regulations thereunder, and interpretations thereof, promulgated by any
regulatory agency having jurisdiction.
In the event that a domestic or foreign Dealer should sell or offer for
sale the Debentures in any jurisdiction outside the United States, Dealer also
agrees to comply with the laws, rules and regulations of any governmental or
regulatory body applicable within such foreign jurisdiction.
4. State Registrations. You will be informed by the Underwriter as to the
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states in which we have been advised by counsel that the Debentures have been
qualified or registered for sale or are exempt under the respective securities
or "blue sky" laws of such states, but we have not assumed and will not assume
any obligation or responsibility as to the accuracy of such information or as to
the eligibility or right of any Selected Dealer to offer or sell the Debentures
in any state.
5. Underwriter Authority and Liability. The Underwriter shall have full
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authority to take such action as it may deem advisable in respect of all matters
pertaining to the offering or arising thereunder. The Underwriter shall not be
under any liability to you with respect to any matter, except such as may be
incurred under the 1933 Act and the rules and regulations thereunder, except for
lack of good faith and except for obligations assumed by us in this Agreement,
and no obligation on our part shall be implied or inferred herefrom.
6. Payment and Procedures. All subscriptions for investments shall be
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confirmed on forms of a type acceptable under the rules and regulations of the
NASD and in accordance with Rule 15c2-8 of the 1934 Act. If at least $4,500,000
in collected funds (as defined in the Escrow Agreement) have been received and
such subscriptions accepted by the Issuer by October 30, 2001, the Issuer may
close the Offering as to those subscribers (the "First Closing Date"). Until the
First Closing Date, you shall promptly, upon receipt of any and all checks,
drafts, and money orders received from prospective purchasers of the Debentures,
transmit, in accordance with Rule 15c2-4(b) of the 1934 Act, such items to
Canandaigua National Bank and Trust Company, Canandaigua, New York, as Escrow
Agent, for deposit into an account entitled "Intervest Corporation of New York
Escrow Account", but in any event such transmittal to the Escrow Agent shall be
made by noon of the next business day after your receipt of such funds. Any
Debentures remaining unsold after the First Closing Date may continue to be
offered and sold for up to 120 days after the First Closing Date. After the
First Closing Date, you shall promptly transmit any and all checks, drafts, and
money orders received from prospective purchasers of the Debentures to the
Underwriter by noon of the next business day after you receive such funds. At
the same time you deliver funds received to the Escrow Agent, or directly to the
Underwriter, you shall also deliver to Underwriter, a written account of each
purchaser which sets forth, among other things, the name, address and tax
identification number of the purchaser, the number of Debentures purchased, the
maturity thereof, and the amount paid therefor which shall be accompanied by a
copy of the check and any transmittal letter to the Escrow Agent.
You agree to be bound by the terms of the Escrow Agreement executed by
Underwriter and the Issuer and acknowledge that you have received a copy of such
Escrow Agreement.
Until the First Closing Date, checks shall be made payable to "CNB - Escrow
Intervest". After the First Closing Date, checks shall be made payable to
"Intervest Corporation of New York", the Issuer. Until the First Closing Date,
any checks received by the Escrow Agent which are made payable to any party
other than the Escrow Agent, shall be returned by the Escrow Agent to the
purchaser who submitted the check and shall not be accepted.
All Debentures shall be registered and issued as designated by Dealer after
the Closing Dates specified in the Prospectus.
The Issuer reserves the right to reject any subscription, and in such case,
the Issuer will instruct the Escrow Agent or Underwriter, as may be the case, to
return, in full, any payment made in connection therewith.
If at least $4,500,000 in collected funds (as defined in the Escrow
Agreement) have not been received and such subscriptions accepted by the Issuer
by __________, 2002, subscription documents and funds shall be promptly returned
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to subscribers. Interest earned on funds in the Escrow Account shall be applied
to pay escrow expenses, with the balance of interest, if any, to be paid to
subscribers in proportion to the amount of funds paid by each such subscriber
without regard to the date when such subscription funds were paid. It shall be a
condition of making any such refund to a subscriber, however, that there be
delivered to the Escrow Agent a Form W-9 executed by such subscriber.
7. Delivery of Prospectus. You shall solicit subscriptions for the
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Debentures only in accordance with the then current Prospectus, shall deliver a
current Prospectus to each prospective investor, shall utilize as solicitation
material only the Prospectus and such supplemental sales literature as shall be
identified as such and furnished or authorized in writing by the Issuer, and
shall make no representations other than those contained in such Prospectus and
supplemental literature. You shall also be responsible for the servicing of
investors, including responding to inquiries by, and maintaining periodic
contacts with, the investor.
8. Restrictions on Sales and Purchases of Debentures. During the term of
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this Agreement, you will not, directly or indirectly, buy, sell, or induce
others to buy or sell, the Debentures except (a) pursuant to this Agreement, (b)
as expressly authorized by the Underwriter in writing, or (c) in the ordinary
course of business as broker or agent for a customer pursuant to an unsolicited
order. You represent that you have not participated in any transaction
prohibited by the preceding sentence and that you have at all times complied
with the provisions of Rule 10b-6 of the 1934 Act applicable to this offering.
You will take such steps as you deem necessary to assure that purchasers of the
Debentures meet the suitability standards set forth in the Prospectus or
otherwise imposed by the Issuer and will maintain for a period of at least four
(4) years a record of the information obtained to indicate that such standards
have been met.
9. Commissions. You will be entitled to receive commissions in the amount
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of $300 on each Debenture maturing October 1, 2005, commissions in the amount of
$500 on each Debenture maturing October 1, 2007, and commissions in the amount
of $700 on each Debenture maturing October 1, 2009 sold by you under this
Agreement, provided, however, that the offering will be terminated and no
commissions will be payable unless an aggregate of at least $4,500,000 of the
Debentures, without regard to maturity, are sold by _____________, 2002.
10. Dealer Responsibility for Training and Representatives. You undertake
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full responsibility for adequate training of your salesmen in all features of
the Debentures offered, with special emphasis on the responsibilities of such
salesmen for full disclosure to prospective investors and the necessity of
delivering a Prospectus to each investor. You will accept subscriptions only
from persons whose investment objectives, to the best of your knowledge and
belief, are consistent with those of the Debentures offered.
11. Sales in Discretionary Accounts. You agree that, without the written
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approval of the customer and the Underwriter prior to the execution of any
order, you will not sell to any account over which you exercise discretionary
authority any of the Debentures which you have been allotted and which are
subject to the terms of this Agreement.
12. Advertisements. It is expected that public advertisement of this issue
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will be made on or about the effective date of the Registration Statement. After
the date of appearance of such advertisement, but not before, you are free to
advertise over your own name and at your own expense and risk, subject, however,
to our prior review and approval of any advertisement.
13. Termination of Agreement. This Agreement may be terminated by either
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party at any time by written or telegraphic notice to the other, but the
Agreement shall not be valid for more than six (6) months from the date of
execution or beyond completion of the offering, whichever is earlier, except
when extended by the Underwriter to complete the offering of the Debentures.
Such termination shall not affect your obligation to comply with this Agreement
nor your right to commissions, as set forth in Paragraph 9 of this Agreement on
subscriptions confirmed by the Issuer by the time of such termination.
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14. Relationship of Parties. Nothing in this Agreement shall be construed
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to constitute Dealer a partner, employee or agent of the Underwriter or Issuer,
and neither Underwriter, Issuer or Dealer shall be liable for any obligation,
act or omission of the other to third parties. However, in the event such a
claim is made, you agree to bear your share of any liability arising out of such
claim.
15. Dealer Expenses. All expenses incurred by Dealer in connection with its
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activities under this Agreement shall be borne by Dealer, except that
Underwriter will furnish, without charge, a reasonable quantity of Prospectuses
and supplemental literature as issued.
16. Miscellaneous. This Agreement supersedes all previous agreements,
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whether oral or written, between Underwriter and Dealer relating to the
Debentures and may not be modified except in writing. All previous agreements,
if any, whether oral or written, between Underwriter and dealer are hereby
canceled. Neither party hereto assumes any liability or obligation toward the
other under this or any previous agreement, except as may be specifically set
forth in this Agreement, nor is any such liability or obligation to be inferred
or implied hereunder.
All communications from you shall be addressed to the Underwriter at the
address set forth above. All communications from the Underwriter to you shall be
directed to the address to which this letter is mailed.
This Agreement shall be construed in accordance with the laws of the State
of New York.
Please confirm that the foregoing sets forth the Agreement between you and
the Underwriter by signing and returning to us the enclosed copy of this letter.
Very truly yours,
SAGE, XXXXX & CO., INC.
By: ________________________________
____________________________________
(Title)
WE HEREBY CONFIRM AS OF THE DATE HEREOF
THAT THE ABOVE LETTER SETS FORTH THE
AGREEMENT BETWEEN THE UNDERWRITER AND
THE UNDERSIGNED
AMOUNT AND MATURITY OF
DEBENTURES TO BE OFFERED
FOR SALE BY DEALER:
_____________________________________
(Dealer)
$_______________________________
October 1, 2005
By: ______________________________
_____________________________________
(Title) $_______________________________
October 1, 2007
$_______________________________
October 1, 2009
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