EXHIBIT 1.3
CAPSOURCE FINANCIAL, INC.,
(A COLORADO CORPORATION)
(3,000,0000 shares of Common Stock @ $1.75 per share )
SELECTED DEALERS AGREEMENT
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_______________, 2003
Gentlemen:
We have agreed to act as the exclusive agent of CAPSOURCE FINANCIAL, INC., a
Colorado Corporation ("Company"), pursuant to an Underwriting Agreement between
the Company and us ("Underwriter"), which may be obtained from us on written
request, for the sale to the public of an aggregate of 3,000,000 shares of
common stock, $0.01 par value @ $1.75 per share ("Common Stock"). The Common
Stock is described in the enclosed Prospectus, additional copies of which will
be supplied in reasonable quantities upon request to us.
We invite your participation as a Selected Dealer ("Selected Dealer") in
offering to the public, a part of the Common Stock at the initial public
offering price of $1.75 per share of Common Stock. As a Selected Dealer, you
will be allowed, subject to the sale of Common Stock in the public offering, a
commission of 7.5 % per share on all shares sold by you. Payment of such
commissions will be made within five (5) business days after the payment of the
proceeds to the Company. The Common Stock will be offered to the public on a
"best efforts" basis subject to the approval of certain legal matters by counsel
and subject to certain other items and conditions. We reserve the right to
withdraw, cancel or modify any offer.
You confirm you are a Selected Dealer: (i) registered with the Securities and
Exchange Commission ("Commission") as a broker-dealer under the Securities
Exchange Act of 1934, as amended ("1934 Act"); (ii) and engaged, in making sales
of securities, to comply with the NASD's interpretation with Respect to
FreeRiding and Withholding (IM-2110-1); (iii) actually engaged in the investment
banking or securities business and who is a member in good standing of the
National Association of Securities Dealers, Inc. ("NASD").
In making sales, you hereby agree to comply with the provisions of Article III
of the Rules of Fair Practice of the NASD. Any agreement herein is conditioned
on your being qualified and registered under applicable securities laws, if any,
to act as a dealer or broker in securities and your compliance with the NASD's
Rules of Fair Practice, including, but not limited to, IM2300, and Sections 8,
24, 25 and 36 of such Rules, or if you are a foreign broker-dealer not eligible
for NASD membership, then it is conditioned upon your agreement to make no offer
or sale of the Common Stock within the United States, its territories or
possessions or to residents therein
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DRAFT-SUBJECT TO CHANGE/CONFIDENTIAL
or nationals thereof, and in making offers and sales to conform to the
applicable NASD Rules of Fair Practice and interpretations as though you were a
member of the NASD. You represent that you meet such conditions and acknowledge
your familiarity with applicable law, rules, regulations and releases, and agree
that you will not directly or indirectly violate any of such applicable
provisions in connection with your acting as a Selected Dealer.
You confirm that you agree to abide by all the applicable rules and regulations
of the Securities and Exchange Commission and interpretations thereof, including
those as to "xxxxx stocks" and "designated securities". Such rules include but
are not limited to Rule 15c2-6, Exchange Act Rule 15(g), and the interpretations
thereunder, and Exchange Act Rule 15c2-6. Your attention is called to and you
agree to comply with the following: (a) Article III, Section 1 of the Rules of
Fair Practice of the NASD and the interpretations of said Section promulgated by
the Board of Governors of the NASD; (b) Section 10(b) of the 1934 Act and
Regulation M, 10b-10 of the general rules and regulations promulgated under the
1934 Act; (c) Rule 15c2-8 of the general rules and regulations promulgated under
the 1934 Act requiring the distribution of a preliminary Prospectus to all
persons reasonably expected to be purchasers of the Common Stock from you at
least 48 hours prior to the time you expect to mail confirmations; and, (d) all
the applicable rules and regulations of the NASD and the interpretations thereof
promulgated by the Board of Governors thereof, including those as to "Free
Riding and Withholding", including Sections 8-24 and 8-36.
All orders will be strictly subject to confirmation and we reserve the right in
our uncontrolled discretion to reject any order in whole or in part, to accept
or reject orders in the order of their receipt or otherwise, and allot. Neither
you nor any other person is authorized by the Company or us to give any
information or make any representations other than those contained in the
Prospectus in connection with the sale of any of the Shares. No Dealer is
authorized to act as agent for us when offering the Common Stock to the public
or otherwise. A registration statement covering the offering has been filed with
the Securities and Exchange Commission with respect to the Common Stock. You
will be promptly advised when the registration statement becomes effective. Each
Selected Dealer in selling Common Stock pursuant hereto agrees (which agreement
shall also be for the benefit of the Company) that it will comply with the
applicable requirements of the Securities Act of 1933 and of the Securities
Exchange Act of 1934 and any applicable rules and regulations issued under said
Acts. Nothing contained herein shall render the Selected Dealers members of the
Underwriting Group or partners with the Underwriter or with one another.
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DRAFT-SUBJECT TO CHANGE/CONFIDENTIAL
Payment for the Common Stock purchased by your customer is to be made by 12:00
noon the next business day following receipt of the proceeds from your customers
by your customer's check or by your certified or banks cashier's check made
payable to "VECTRA BANK COLORADO, N.A., ESCROW AGENT FOR CAPSOURCE FINANCIAL,
INC." at __________________________ 00000-0000, at the initial public offering
price against delivery of the shares of Common Stock to be purchased by your
customer. In addition, there shall be provided to us at 000 Xxxxx Xxxxxxx Xxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxxxxx, 00000 Attn: Xxxxxxx X. Xxxx, President, the
names and addresses of the purchasers, the number of shares of Common Stock
purchased by each, the amount paid therefor, and whether the amount paid was in
the form of cash or evidenced by a check.
This agreement shall terminate at the close of business on the day after the
Date of Delivery (as defined in the Underwriting Agreement), unless earlier
terminated. We may terminate this Agreement at any time by written or
telegraphic notice to you.
In the event that prior to the termination of this Agreement we purchase in the
open market or otherwise, any shares of Common Stock delivered to you, you agree
to repay to us the amount of the above concession to Selected Dealers plus
brokerage commissions and transfer taxes paid in connection with such purchase
or contract to purchase.
You agree to indemnify us and to hold us harmless and each person, if any, who
controls us, within the meaning of Section 15, of the Securities Act of 1933
("1933 Act"), against any and all losses, claims, damages, or liabilities to
which we may become subject as a result of your breach of this agreement or of
your failure to perform any of the promises contained herein, and will also
reimburse us, or any controlling connection with investigation or defending such
action or claim.
We shall have full authority to take such action as we may deem advisable in
respect of all matters pertaining to the offering. We shall be under no
liability to you except for lack of good faith and for obligations expressly
assumed by us in this Agreement. Nothing contained in this paragraph is intended
to operate as, and the provisions of this paragraph shall not in any way
whatsoever constitute, a waiver by you of compliance with any provision of the
1933 Act, or of the rules and regulations of the Securities and Exchange
Commission ("Commission") issued thereunder.
Upon application to us, we will inform you as to the jurisdictions in which we
believe the Common Stock has been qualified for sales under, or are exempt from
the requirements of, the respective securities laws of such jurisdictions, but
we assume no responsibility or obligation as to your right to sell the Common
Stock in any
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jurisdiction. You agree not to sell Common Stock in any other state or
jurisdiction and to not sell Common Stock in any state or jurisdiction unless
you are qualified or licensed to sell securities in such state or jurisdiction.
You confirm that you are familiar with Rule 15c2-8 under the 1934 Act relating
to the distribution of preliminary and final prospectuses and confirm that you
have complied and will comply therewith.
We hereby confirm that we will make available to you such number of copies of
the Prospectus (as amended or supplemented) as you may reasonably request for
the purposes contemplated by the 1933 Act, or the 1934 Act or the rules and
regulations of the Commission thereunder.
You, as a member of the NASD, by signing this Agreement, acknowledge that you
are familiar with the cited laws and rules and agree that you will not directly
and/or indirectly violate any provisions of applicable law in connection with
your participation in the distribution of the Common Stock, by becoming a member
of the Selected Dealers represent that (a) neither you nor any of your
directors, officers, partners or "persons associated with" you (as defined in
the By-Laws of the NASD), nor to your knowledge, any "related person" (defined
by the NASD to include counsel, financial consultants and advisors, finders,
members of the selling group or distribution group, and any other persons
associated with or related to any of the foregoing) or any other broker-dealer,
(i) within the last 18 months have purchased in private transactions, or intends
before, at or within 6 months after the commencement of the public offering of
the Common Stock, to purchase in private transactions, any securities of the
Company or any parent, predecessor, or subsidiary thereof, (ii) within the last
12 months had any dealings with any of the Company or the parent, predecessor,
subsidiary or controlling shareholder thereof, or (iii) have, except as
contemplated by this Agreement, any agreement, arrangement or understanding to
receive compensation in connection with (as defined by the NASD) the
distribution of the Common Stock.
Any notice from us to you shall be deemed to have been duly given if mailed or
telegraphed to you at the address to which this Agreement is mailed.
This Agreement will be governed by and construed in accordance with the laws of
the State of Washington.
Any controversy arising out of, connected to, or relating to any matters herein
of the transactions between Selected Dealer and Public Securities, Inc.
(including for purposes of arbitration, officers, directors, employees,
controlling persons, affiliates,
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professional advisors, agents, or promoters of the Public Securities), on behalf
of the undersigned, or this Agreement, or the breach thereof, including, but not
limited to any claims of violations of Federal and/or State Securities Acts,
Banking Statutes, Consumer Protection Statutes, Federal and/or State
anti-Racketeering (e.g. RICO) claims as well as any common law claims and any
State Law claims of fraud, negligence, negligent misrepresentations, and/or
conversion shall be settled by arbitration; and in accordance with this
paragraph and judgment on the arbitrator's award may be entered in any court
having jurisdiction thereof in accordance with the provisions of Revised Code of
Washington, ss.7.04. In the event of such a dispute, each party to the conflict
shall select an arbitrator, both of whom then shall select a third arbitrator,
which shall constitute the three person arbitration board. The decision of a
majority of the board of arbitrators, who shall render their decision within
thirty (30) days of appointment of the final arbitrator, shall be binding upon
the parties.
Please confirm your agreement hereto by a facsimile transmission of your
acceptance and by signing and returning at once to us at 000 Xxxxx Xxxxxxx Xxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxxxxx, 00000 Attn: Xxxxxxx X. Xxxx, President,
(509-892-5620) the enclosed duplicate of this letter. Upon receipt thereof, this
letter and such signed duplicate copy will evidence the agreement between us.
Your Truly:
PUBLIC SECURITIES, INC.
By:
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Title:
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Shares
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Selected Dealers Allocation
AGREED AND ACCEPTED as of the date first above written:
SELECTED DEALER
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By:
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Title:
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