Exhibit 1.2
MASTER SELECTED DEALER AGREEMENT
_____________, 2004
Xxxx Xxxx & Co., Inc.
00 Xxxxxxxx Xxxxxxxx
Xxxxxxx Xxxx, XX 00000-0000
Gentlemen:
(1) General. We understand that Xxxx Xxxx & Co., Inc. ("Xxxx Xxxx") is
entering into this Agreement with us and other firms who may be offered the
right to purchase as principal a portion of securities being distributed to the
public. The terms and conditions of this Agreement shall be applicable to any
public offering of securities ("Securities") pursuant to a registration
statement filed under the Securities Act of 1933 (the "Securities Act") or
exempt from registration thereunder (other than a public offering of Securities
effected wholly outside the United States of America), wherein Xxxx Xxxx (acting
for its own account or for the account of any underwriting or similar group or
syndicate) is responsible for managing or otherwise implementing the sale of the
Securities to selected dealers ("Selected Dealers") and has informed us that
such terms and conditions shall be applicable. Any such offering of Securities
to us as a Selected Dealer is hereinafter called an "Offering." In the case of
any Offering in which you are acting for the account of any underwriting or
similar group or syndicate ("Underwriters"), the terms and conditions of this
Agreement shall be for the benefit of, and binding upon, such Underwriters,
including, in the case of any Offering in which you are acting with others as
representatives of Underwriters, such other representatives. The term
"preliminary prospectus" means any preliminary prospectus relating to an
Offering of Securities or any preliminary prospectus supplement together with a
prospectus relating to an Offering of Securities; the term "Prospectus" means
the prospectus, together with the final prospectus supplement, if any, relating
to an Offering of Securities, filed pursuant to Rule 424(b) or Rule 424(c) under
the Securities Act or any successor or similar rules.
This Agreement constitutes the entire agreement of the parties
with regard to the subject matter hereof and supersedes any prior oral or
written agreements or understanding between the parties hereto or their
predecessors with respect to the subject matter hereof.
(2) Conditions of Offering, Acceptance and Purchase. Any Offering will
be subject to delivery of the Securities and their acceptance by you and any
other Underwriters, may be subject to the approval of all legal matters by
counsel and the satisfaction of other conditions, and may be made on the basis
of reservation of Securities or an allotment against subscription. You will
advise us by telegram, telex, facsimile, e-mail, or other form of written
communication ("Written Communication") of the particular method and
supplementary terms and conditions (including, without limitation, the
information as to prices and offering date referred to in Section 3(c)) of any
Offering in which we are invited to participate. To the extent such
supplementary terms and conditions are inconsistent with any
provision herein, such terms and conditions shall supersede any such provision.
Unless otherwise indicated in any such Written Communication, acceptances and
other communications by us with respect to any Offering should be sent to Xxxx
Xxxx. You may close the subscription books at any time in your sole discretion
without notice, and you reserve the right to reject any acceptance in whole or
in part. Payment for Securities purchased by us is to be made at such office as
you may designate, at the public offering price, or, if you shall so advise us,
at such price less the concession to dealers or at the price set forth or
indicated in a Written Communication, on such date as you shall determine, on
one day's prior notice to us, by wire transfer to a Xxxx Xxxx account, against
delivery of certificates or other forms evidencing such Securities. If payment
is made for Securities purchased by us at the public offering price, the
concession to which we shall be entitled will be paid to us upon termination of
the provisions of Section 3(c) with respect to such Securities.
Unless we promptly give you written instructions otherwise, if
transactions in the Securities may be settled through the facilities of The
Depository Trust Company, delivery of Securities purchased by us will be made
through such facilities if we are a member, or if we are not a member,
settlement may be made through our ordinary correspondent who is a member.
(3) Representations, Warranties, and Agreements.
(a) Registered Offerings. In the case of any Offering of Securities
that are registered under the Securities Act ("Registered Offering"), you shall
provide us with such number of copies of each preliminary prospectus, the
Prospectus and any supplement thereto relating to each Registered Offering as we
may reasonably request for the purposes contemplated by the Securities Act and
the Securities Exchange Act of 1934 (the "Exchange Act") and the applicable
Rules and regulations of the Securities and Exchange Commission thereunder. We
represent that we are familiar with Rule 15c2-8 under the Exchange Act relating
to the distribution of preliminary and final prospectuses and agree that we will
comply therewith. We agree to keep an accurate record of our distribution
(including dates, number of copies, and persons to whom sent) of copies of the
Prospectus or any preliminary prospectus (or any amendment or supplement to any
thereof), and promptly upon request by you, to bring all subsequent changes to
the attention of anyone to whom such material shall have been furnished. We
agree to furnish to persons who receive a confirmation of sale a copy of the
Prospectus filed pursuant to Rule 424(b) or Rule 424(c) under the Securities
Act. We agree that in purchasing Securities in a Registered Offering we will
rely upon no statements whatsoever, written or oral, other than the statements
in the Prospectus delivered to us by you. We will not be authorized by the
issuer or other seller of Securities offered pursuant to a Prospectus or by any
Underwriter to give any information or to make any representation not contained
in the Prospectus in connection with the sale of such Securities.
(b) Offerings Pursuant to Offering Circular. In the case of any
Offering of Securities, other than a Registered Offering, which is made pursuant
to an offering circular or other document comparable to a prospectus in a
Registered Offering, including, without limitation, an Offering of "exempted
securities" as defined in Section 3(a)(2) of the Securities Act (an "Exempted
Securities Offering"), you shall provide us with such number of copies of each
preliminary offering circular, the final offering circular and any supplement
thereto relating to each Offering as we may reasonably request. We agree that we
will comply with the applicable federal and state laws, and the applicable rules
and regulations of any regulatory body promulgated thereunder, governing the use
and distribution of offering circulars by brokers or dealers. We agree that in
purchasing Securities pursuant to an offering circular we will rely upon no
statements whatsoever, written or oral, other than the statements in the final
offering
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circular delivered to us by you. We will not be authorized by the issuer or
other seller of Securities offered pursuant to an offering circular or by any
Underwriter to give any information or to make any representation not contained
in the offering circular in connection with the sale of such Securities.
(c) Offer and Sale to the Public. With respect to any Offering of
Securities, you will inform us by a Written Communication of the public offering
price, the selling concession, the reallowance (if any) to dealers, and the time
when we may commence selling Securities to the public. After such public
offering has commenced, you may change the public offering price, the selling
concession, and the reallowance to dealers. With respect to each Offering of
Securities, until the provisions of this Section 3(c) shall be terminated
pursuant to Section 5, we agree to offer Securities to the public only at the
public offering price, except that if a reallowance is in effect, a reallowance
from the public offering price not in excess of such reallowance may be allowed
as consideration for services rendered in distribution to dealers who are
actually engaged in the investment banking or securities business, who execute
the written agreement prescribed by Rule 2740 of the Rules of Conduct of the
National Association of Securities Dealers, Inc. (the "NASD") and who are either
members in good standing of the NASD or foreign brokers or dealers not eligible
for membership in the NASD who represent to us that they will promptly reoffer
such Securities at the public offering price and will abide by the conditions
with respect to foreign brokers and dealers set forth in Section 3(f) hereof.
(d) Stabilization and Overallotment. You may, with respect to any
Offering, be authorized to over-allot in arranging sales to Selected Dealers, to
purchase and sell Securities, any other securities of the issuer of the
Securities of the same class and series and any other securities of such issuer
that you may designate for long or short account, and to stabilize or maintain
the market price of the Securities. We agree not to purchase and sell Securities
for which an order from a client has not been received without your consent in
each instance. We agree to advise you from time to time upon request, prior to
the termination of the provisions of Section 3(c) with respect to any Offering,
of the amount of Securities purchased by us hereunder remaining unsold and we
will, upon your request, sell to you, for the accounts of the Underwriters, such
amount of Securities as you may designate, at the public offering price thereof
less an amount to be determined by you not in excess of the concession to
dealers. In the event that prior to the later of (i) the termination of the
provisions of Section 3(c) with respect to any Offering, or (ii) the covering by
you of any short position created by you in connection with such Offering for
your account or the account of one or more Underwriters, you purchase or
contract to purchase for the account of any of the Underwriters, in the open
market or otherwise, any Securities theretofore delivered to us, you reserve the
right to withhold the above-mentioned concession to dealers on such Securities
if sold to us at the public offering price, or if such concession has been
allowed to us through our purchase at a net price, we agree to repay such
concession upon your demand, plus in each case any taxes on redelivery,
commissions, accrued interest, and dividends paid in connection with such
purchase or contract to purchase.
(e) Open Market Transactions. We agree to abide by Regulation M under
the Exchange Act and we agree not to bid for, purchase, attempt to purchase, or
sell, directly or indirectly, any Securities, any other Reference Securities (as
defined in Regulation M) of the issuer, or any other securities of such issuer
as you may designate, except as brokers pursuant to unsolicited orders and as
otherwise provided in this Agreement. If the Securities are common stock or
securities convertible into common stock, we agree not to effect, or attempt to
induce others to effect, directly or indirectly, any transactions in or relating
to any stock of such issuer, except to the extent permitted by Rule 101 of
Regulation M under the Exchange Act.
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(f) NASD. We represent that we are actually engaged in the investment
banking or securities business and we are either (i) a member in good standing
of the NASD, (ii) if not such a member, a foreign dealer not eligible for
membership, or (iii) solely in connection with an Exempted Securities Offering,
a bank, as defined in Section 3(a)(6) of the Exchange Act, that does not
otherwise fall within provision (i) or (ii) of this sentence (a "Bank"). If we
are a member as described in (i), we agree that in making sales of the
Securities we will comply with all applicable interpretative materials and
Conduct Rules of the NASD, including, without limitation, Conduct Rules 2740
(relating to Selling Concessions, Discounts and Other Allowances) and 2790
(relating to New Issues). If we are a foreign dealer as described in (ii), we
agree not to offer or sell any Securities in the United States of America, its
territories or its possessions or to persons who are citizens thereof or
residents therein (other than through you), and in making sales of Securities
outside the United States of America we agree to comply as though we were a
member with Conduct Rules 2730 (relating to Securities Taken in Trade), 2740
(relating to Selling Concessions), 2750 (relating to Transactions with Related
Persons) and 2790 (relating to New Issues) as though we were such a member and
to comply with Conduct Rule 2420 (relating to Dealing with Non-Members) as it
applies to a nonmember broker or dealer in a foreign country. In connection with
an Exempted Securities Offering, if we are a Bank, we agree to also comply, as
though we were an NASD member, with the provision of Rules 2730, 2740 and 2750
of the Conduct Rules. We further represent, by our participating in an Offering,
that we have provided to you all documents and other information required to be
filed with respect to us, any related person or any person associated with us or
any such related person pursuant to the supplementary requirements of the NASD's
interpretation with respect to review of corporate financing as such
requirements relate to such Offering.
We further agree that, in connection with any purchase of
Securities from you that is not otherwise covered by the terms of this Agreement
(whether you are acting as manager, as member of an underwriting syndicate or a
selling group or otherwise), if a selling concession, discount or other
allowance is granted to us, the preceding paragraph will be applicable.
(g) Relationship among Underwriters and Selected Dealers. You may buy
Securities from or sell Securities to any Underwriter or Selected Dealer and,
with your consent, the Underwriters (if any) and the Selected Dealers may
purchase Securities from and sell Securities to each other at the public
offering price less all or any part of the concession. We are not authorized to
act as agent for you or any Underwriter or the issuer or other seller of any
Securities in offering Securities to the public or otherwise. Nothing contained
herein or in any Written Communication from you shall constitute the Selected
Dealers partners with you or any Underwriter or with one another. If the
Selected Dealers, among themselves or with the Underwriters, should be deemed to
constitute a partnership for federal income tax purposes, then we elect to be
excluded from the application of Subchapter K, Chapter 1, Subtitle A of the
Internal Revenue Code of 1986 and agree not to take any position inconsistent
with that election. We authorize you, in your discretion, to execute and file on
our behalf such evidence of that election as may be required by the Internal
Revenue Service. Neither you nor any Underwriter shall be under any obligation
to us except for obligations assumed hereby or in any Written Communication from
you in connection with any Offering. In connection with any Offering, we agree
to pay our proportionate share of any tax, claim, demand, or liability asserted
against us, and the other Selected Dealers or any of them, or against you or the
Underwriters, if any, based on any claim that such Selected Dealers or any of
them constitute an association, unincorporated business, or other separate
entity, including in each case our proportionate share of any expense incurred
in defending against any such tax, claim, demand, or liability.
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(h) Blue Sky Laws. Upon application to you, you will inform us as to the
jurisdictions in which you believe the Securities have been qualified for sale
or are exempt under the respective securities or "blue sky" laws of such
jurisdictions. We understand and agree that compliance with the securities or
"blue sky" laws in each jurisdiction in which we shall offer or sell any of the
Securities shall be our sole responsibility and that you assume no
responsibility or obligations as to the eligibility of the Securities for sale
or our right to sell the Securities in any jurisdiction.
(i) Compliance with Law. We agree that in selling Securities pursuant
to any Offering (which agreement shall also be for the benefit of the issuer or
other seller of such Securities), we will comply with the applicable provisions
of the Securities Act and the Exchange Act, the applicable Rules and regulations
of the Securities and Exchange Commission thereunder, the applicable Rules and
regulations of the NASD, the applicable Rules and regulations of any securities
exchange having jurisdiction over the Offering, and the applicable laws, rules
and regulations specified in Section 3(c) hereof. Without limiting the
foregoing, (a) we agree that, at all times since we were invited to participate
in an Offering of Securities, we have complied with the provisions of Regulation
M applicable to such Offering, in each case after giving effect to any
applicable exemptions and (b) we represent that our incurrence of obligations
hereunder in connection with any Offering of Securities will not result in the
violation by us of Rule 15c3-1 under the Exchange Act, if such requirements are
applicable to us. You shall have full authority to take such action as you may
deem advisable in respect of all matters pertaining to any Offering. Neither you
nor any Underwriter shall be under any liability to us, except for lack of good
faith and for obligations expressly assumed by you in this Agreement; provided,
however, that nothing in this sentence shall be deemed to relieve you from any
liability imposed by the Securities Act.
(4) Indemnification. We agree to indemnify and hold harmless Xxxx Xxxx,
the issuer of the Securities, each person, if any, who controls (within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act) Xxxx Xxxx or the issuer of the Securities, and their respective directors,
officers and employees from and against any and all losses, liabilities, costs
or claims (or actions in respect thereof) (collectively, "Losses") to which any
of them may become subject (including all reasonable costs of investigating,
disputing or defending any such claim or action), insofar as such Losses arise
out of or are in connection with the breach of any representation, warranty or
agreement made by us herein.
If any claim, demand, action or proceeding (including any
governmental investigation) shall be brought or alleged against an indemnified
party in respect of which indemnity is to be sought against an indemnifying
party, the indemnified party shall promptly notify the indemnifying party in
writing, and the indemnifying party, upon request of the indemnified party,
shall retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnified party may
designate in such proceeding and shall pay the reasonable fees and expenses of
such counsel related to such proceeding. In any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the reasonable fees
and expenses of such counsel shall be at the expense of such indemnified party
unless (i) the indemnifying party and the indemnified party shall have mutually
agreed to the retention of such counsel, (ii) the indemnifying party has failed
within a reasonable time to retain counsel reasonably satisfactory to such
indemnified party or (iii) the named parties to any such proceeding (including
any impleaded parties) include both the indemnifying party and the indemnified
party and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It is
agreed that the indemnifying party shall
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not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than one
separate law firm (in addition to local counsel where necessary) for all such
indemnified parties. Such firm shall be designated in writing by the indemnified
party. The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
The indemnity agreements contained in this Section and the
representations and warranties by us in this Agreement shall remain operative
and in full force and effect regardless of: (i) any termination of this
Agreement, (ii) any investigation made by an indemnified party or on such
party's behalf or any person controlling an indemnified party or by or on behalf
of the indemnifying party, its directors or officers or any person controlling
the indemnifying party, and (iii) acceptance of and payment for any Securities.
(5) Termination; Supplements and Amendments. This Agreement may be
terminated by either party hereto upon five business days' written notice to the
other party; provided that with respect to any Offering for which a Written
Communication was sent and accepted prior to such notice, this Agreement as it
applies to such Offering shall remain in full force and effect and shall
terminate with respect to such Offering in accordance with the last sentence of
this Section. This Agreement may be supplemented or amended by you by written
notice thereof to us, and any such supplement or amendment to this Agreement
shall be effective with respect to any Offering to which this Agreement applies
after the date of such supplement or amendment. Each reference to "this
Agreement" herein shall, as appropriate, be to this Agreement as so amended and
supplemented. The terms and conditions set forth in Sections 3(c) and (e) with
regard to any offering will terminate at the close of business on the thirtieth
day after the date of the initial public offering of the Securities to which
such Offering relates, but such terms and conditions, upon notice to us, may be
terminated by you at any time.
(6) Successors and Assigns. This Agreement shall be binding on, and
inure to the benefit of, the parties hereto and other persons specified or
indicated in Section 1, and the respective successors and assigns of each of
them.
(7) Governing Law. This Agreement and the terms and conditions set
forth herein with respect to any Offering together with such supplementary terms
and conditions with respect to such Offering as may be contained in any Written
Communication from you to us in connection therewith shall be governed by, and
construed in accordance with, the laws of the State of New York without regard
to conflicts of laws principles.
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By signing this Agreement we confirm that our subscription to, or our
acceptance of any reservation of, any Securities pursuant to an Offering shall
constitute (i) acceptance of and agreement to the terms and conditions of this
Agreement (as supplemented and amended pursuant to Section 5) together with and
subject to any supplementary terms and conditions contained in any Written
Communication from you in connection with such Offering, all of which shall
constitute a binding agreement between us and you, individually, or as
representative of any Underwriters, (ii) in confirmation that our
representations and warranties set forth in Section 3 are true and correct at
that time and (iii) confirmation that our agreements set forth in Sections 2 and
3 have been and will be fully performed by us to the extent and at the times
required thereby.
Very truly yours,
__________________________
(Name of Firm)
By: ______________________
Confirmed, as of the date
first above written.
XXXX, XXXX & CO., INC.
By: ____________________________
Xxxx X. Xxxxxxx
Executive Vice - President
Execution Date: ___________
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