EXHIBIT 1.02
Exhibit A
ADDITIONAL SELLER AGREEMENT
________________
(Date)
Xxxx Xxxxxx Xxxxxxxx Inc.
Two World Trade Center, 62nd Floor
New York, New York 10048
Gentlemen:
Xxxx Xxxxxx Spectrum Global Balanced L.P., formerly Xxxx Xxxxxx Spectrum
Balanced L.P. ("Global Balanced"), Xxxx Xxxxxx Spectrum Strategic L.P.
("Strategic"), Xxxx Xxxxxx Spectrum Technical L.P. ("Technical"), and Xxxx
Xxxxxx Spectrum Select L.P., formerly Xxxx Xxxxxx Select Futures Fund L.P.
("Select"; collectively with Global Balanced, Strategic and Technical, the
"Partnerships"; and each individually, a "Partnership"), each a limited
partnership organized under the Delaware Revised Uniform Limited Partnership
Act, are proposing concurrently to offer and sell, and issue, up to 8,000,000,
12,500,000, 23,000,000 and 1,500,000 units of limited partnership interest (the
"Units"), respectively, in accordance with the terms and conditions set forth in
the Amended and Restated Selling Agreement, dated as of , 1998 (the "Selling
Agreement"), among you, the Partnerships, and Demeter Management Corporation, a
Delaware corporation which is the general partner of the Partnerships (the
"General Partner"), and in the effective registration statements on Form S-1
listed in Schedule A attached hereto, including the exhibits and any amendments
thereto, as filed by the Partnerships with the Securities and Exchange
Commission (the "SEC") under the Securities Act of 1933, as amended (the "1933
Act"). Such registration statements, in the form in which they have become
effective under the 1933 Act, are herein referred to each individually as a
"Registration Statement," and collectively as the "Registration Statements,"
and the prospectus constituting a part of the last Registration Statement under
the 1933 Act in the form last filed with the SEC pursuant to Rule 424 under the
1933 Act, together with any supplements thereto, is herein referred to as the
"Prospectus."
Pursuant to the Selling Agreement, you were appointed the selling agent for
the Units to use your best efforts to offer and sell Units and, in that
connection, you were authorized under the Selling Agreement to appoint, with the
written approval of the General Partner, as your agent to make offers and sales
of Units, certain securities brokers or dealers (each such broker or dealer, an
"Additional Seller"). All capitalized terms used herein shall have the meanings
ascribed to them in the Selling Agreement unless otherwise defined herein or
unless the context indicates otherwise.
On the basis of the terms, conditions, and agreements contained in this
Agreement, we agree with you as follows:
1. We agree to become an Additional Seller, to use our best efforts to
offer and sell the Units on the terms stated in this Agreement, the Selling
Agreement, the Registration Statements, and the Prospectus, and to comply with
the terms and conditions of this Agreement and the Selling Agreement in making
offers and sales of Units.
2. We, as an Additional Seller, represent and warrant to you, as follows:
(a) We are a corporation, partnership, or other entity duly organized,
validly existing, and in good standing under the laws of the jurisdiction
indicated on the signature page hereof, and are qualified to do business and are
in good standing in each jurisdiction in which the nature or conduct of our
business requires such qualification and where the failure to be so qualified
could materially adversely affect our ability to perform our
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obligations hereunder. We have full power and authority under applicable law to
conduct our business and perform our obligations under this Agreement.
(b) We have all U.S. federal and state, and non-U.S. regulatory and self-
regulatory approvals, licenses, registrations, and memberships, and have
effected all filings with U.S. federal and state, and non-U.S. governmental
regulators and self-regulatory organizations required to conduct our business
and required to perform our obligations under this Agreement. Specifically, we
are either: (i) a broker or dealer who is (A) registered and in good standing
as such with the SEC under the Securities Exchange Act of 1934, as amended (the
"1934 Act"), (B) registered or licensed and in good standing as such under the
respective securities laws of the 50 states, the District of Columbia, and
Puerto Rico where such registration or licensing is required for us to
consummate offers and sales of Units as contemplated by this Agreement, and (C)
a member in good standing of the National Association of Securities Dealers,
Inc. (the "NASD"); or (ii) a non-U.S. broker or dealer not eligible for
membership in the NASD, in which case we agree (A) to make no offers or sales of
Units within the United States, its territories or possessions, or areas subject
to its jurisdiction, or to persons who are citizens thereof or residents
therein, (B) that in making offers and sales of Units, we will comply with the
"Free-Riding and Withholding Interpretation" in IM-2110-1 to NASD Conduct Rule
2110, and NASD Conduct Rules 2730 and 2750, as if we were a member of the NASD,
and NASD Conduct Rule 2420 as it applies to a non-member non-U.S. broker or
dealer, (C) that we will not offer or sell any Units in any non-U.S.
jurisdiction until we effect, at our cost and expense, any and all registration
or qualification filings with regard to the Units, the Partnerships or the
General Partner as may be required under the securities or other laws of such
jurisdiction (we will provide you, at our
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cost and expense, an opinion of qualified counsel, satisfactory in form and
substance to you, confirming that any such filings have been properly effected,
or that no such filings were required, prior to the time any Subscription
Agreement is delivered by a resident of any non-U.S. jurisdiction), and (D) that
because limited partners in the Partnerships have a right of exchange
(redemption of Units and purchase of Units with the proceeds of the redemption)
among the Partnerships, we will maintain and update as necessary, at our cost
and expense, any required registration or qualification filings effected
pursuant to the immediately preceding clause (C) so long as any person resident
in such non-U.S. jurisdiction remains a Limited Partner.
(c) This Agreement has been duly and validly authorized, executed, and
delivered by us and constitutes our valid and binding agreement, enforceable
against us in accordance with its terms.
(d) The execution and delivery of this Agreement, the incurrence of the
obligations set forth herein, and the consummation of the transactions
contemplated herein will not violate, or constitute a breach of, or default
under, our certificate of incorporation or bylaws, partnership certificate or
agreement, or other organizational document, or any other agreement or
instrument by which we are bound or any order, law, rule, or regulation
applicable to us of any court, governmental body, administrative agency, panel,
or self-regulatory organization having jurisdiction over us.
3. It is understood and agreed that we shall not, without your prior
written approval, publish, circulate, distribute, or otherwise use any
advertisement or solicitation material relating to the Units, other than the
Prospectus and any other selling literature supplied by you to us expressly for
such purpose ("Selling Literature"). We understand and
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acknowledge that we are not authorized by you, the General Partner, or any
Partnership to make any representations in connection with the offering of Units
other than those contained in the Prospectus. It is agreed that, upon our
written request, you shall provide us with copies of the Registration
Statements.
4. We will offer and sell Units only to persons who satisfy the
suitability and/or minimum investment requirements set forth in the Prospectus
and the Subscription Agreement (and as may be required by the law of any
non-U.S. jurisdiction in which we may offer Units) and who, to the General
Partner's satisfaction, complete a Subscription Agreement. We will conduct a
thorough review of the suitability of each subscriber for Units. We will
forward subscriptions to the General Partner's office at Two World Trade Center,
62nd Floor, New York, New York 10048-0026 (or such other office as you may
notify us), no later than noon of the first business day following our receipt
of an acceptable Subscription Agreement from a subscriber for Units, by mail or
courier, so that the General Partner should receive such Subscription Agreement
at least five business days prior to the applicable Monthly Closing. We will
arrange for the opening of a customer account with you for each such subscriber
for the purpose of paying for subscriptions, crediting of interest thereon,
redemptions of Units, and receipt of any distributions thereon. We understand
that subsequent to its review of each Subscription Agreement, the General
Partner will notify us, and we shall notify each subscriber by the business day
following our receipt of notice from the General Partner, of the General
Partner's acceptance of all, a portion, or none of the subscriber's
subscription. We understand that the General Partner may reject subscriptions,
in whole or in part, for any reason, and we agree that we shall not be entitled
to commissions with respect to any rejected subscriptions. All payments for
subscriptions by subscribers shall be made as
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provided under the heading "Subscription Procedure" in the Prospectus. You
shall be responsible for the deposit of subscription funds into the Escrow
Account as described under the heading "Plan of Distribution" in the
Prospectus. You shall be responsible for issuance and delivery of interim
receipts to subscribers.
5. We will offer and sell Units in compliance with the requirements set
forth in the Registration Statements, the Prospectus (particularly under the
captions "Summary of the Prospectus -- Investment Requirements," "Plan of
Distribution," "Subscription Procedure," and "Purchases by Employee Benefit
Plans -- ERISA Considerations"), the Subscription Agreement, the Selling
Agreement, and this Agreement. We will comply fully at all times with all
applicable U.S. federal and state, and non-U.S. securities and commodities laws
(including, without limitation, the 1933 Act, the 1934 Act, the Commodity
Exchange Act, as amended (the "CEAct"), and the securities laws of the
jurisdictions in which we solicit subscriptions), and all applicable
requirements of the NASD (including NASD Conduct Rule 2810, particularly
paragraphs (b)(2) and (3) thereof), the Board of Governors of the Federal
Reserve System, and all other securities and commodities exchanges, governmental
regulators and self-regulatory organizations that have jurisdiction over us or
over the offer and sale of Units by us.
6. Specifically, if we are a member of the NASD, (a) we will not permit
the purchase of any Units by a customer account over which we have discretionary
authority without the prior written approval by the customer owning such
account; (b) we confirm that we have reasonable grounds to believe that all
material facts are adequately and accurately disclosed in the Prospectus, which
provides a basis for evaluating the Partnerships; (c) we confirm that in
determining the adequacy of disclosed facts pursuant to clause (b), we have
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obtained information on material facts relating to: (i) items of compensation,
(ii) tax aspects, (iii) financial stability and experience of the General
Partner, and (iv) the Partnerships' conflicts and risk factors; (d) we will take
such measures as are reasonably necessary to assure ourselves that (i) our
registered principals and representatives have informed each subscriber of all
pertinent facts relating to the liquidity and marketability of the Units, and
(ii) in recommending the purchase or redemption of Units, or the exchange of
Units in one Partnership for Units in another Partnership, as described under
"Exchange Privilege" in the Prospectus (an "Exchange"), our registered
principals and representatives have reasonable grounds to believe, on the basis
of information obtained from each subscriber concerning his investment
objectives, other investments, financial situation and needs, and any other
information known by such registered principal or representative, that: (A)
such subscriber is or will be in a financial position appropriate to enable him
to realize to a significant extent the benefits described in the Prospectus, (B)
such subscriber has a fair market net worth sufficient to sustain the risks
inherent in the purchase of Units, including loss of investment and lack of
liquidity, and (C) the purchase of Units is otherwise suitable for such
subscriber; and (e) it is understood that the General Partner will maintain in
its files, located c/o Xxxx Xxxxxx Xxxxxxxx Inc., Two Xxxxx Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, each subscriber's Subscription Agreement for not less than
six years, and we will maintain, at our respective branch offices, any other
documents disclosing the basis upon which the determination of suitability was
reached for each such subscriber.
7. Promptly after each closing, you shall pay to us for each Unit
subscribed, accepted, and paid for through our efforts, a commission of ___% of
the Net Asset Value of each such Unit as of the closing as of which the Unit is
issued. Your
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determination of the amount payable to us, if any, shall be conclusive. In
addition, if we are legally qualified or permitted to receive additional
compensation, as provided in Section 5(h) of the Selling Agreement, you agree to
pay to us, as additional compensation, an amount equal to _____% of the monthly
brokerage fees received by you from each Partnership and attributable to the
outstanding Units sold by us. Such additional compensation shall be in
consideration of and is contingent upon our agreement (which we hereby undertake
to perform) to provide additional services in connection with Units sold by us,
including: (i) inquiring of the General Partner from time to time, at the
request of a Limited Partner, as to the Net Asset Value of a Unit; (ii)
inquiring of the General Partner, at the request of a Limited Partner, as to the
futures markets and the activities of the Partnerships; (iii) responding to
questions of Limited Partners from time to time with respect to monthly account
statements, annual reports, financial statements, and annual tax information
furnished periodically to Limited Partners; (iv) providing advice to Limited
Partners from time to time as to when and whether to make additional investments
or to redeem or Exchange Units; (v) assisting Limited Partners in the redemption
or Exchange of Units; and (vi) providing such other services as Limited Partners
from time to time may reasonably request. We understand and agree that no
portion of such additional compensation may be paid to our employees unless such
employees meet the qualifications set forth in Section 5(g) of the Selling
Agreement and have actually performed the above services for the Limited
Partners holding Units sold by us. Acceptance of compensation hereunder shall
constitute a representation by us that we have complied with all of the
provisions of this Paragraph 7 and this Agreement, and that we shall comply with
the provisions of this Paragraph 7 so long as we shall continue to receive any
additional compensation hereunder as specified in this Paragraph 7. We shall
not be entitled to a
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commission in any case in which it is determined by you or the General Partner
that the solicitation by us was made in violation of the securities or
commodities laws of any applicable jurisdiction. It is understood that any
compensation payable to us hereunder is payable solely from your funds, and
neither any Partnership, the General Partner, any subscriber, nor any Limited
Partner shall be liable or responsible therefor.
8. This Agreement shall terminate upon the termination of the offering
pursuant to the Selling Agreement and may be terminated by either party upon ten
(10) days' prior written notice to the other. Upon termination of this
Agreement, all authorizations, rights and obligations hereunder shall cease,
except (a) the indemnities set forth in Paragraph 10 hereof, (b) the obligations
to settle accounts hereunder, (c) our obligations under Paragraph 2(b)(ii)(D)
and Paragraph 9 hereof, and (d) your agreement to provide additional
compensation and our obligations in connection therewith set forth in Paragraph
7 hereof.
9. We authorize you to deduct from any compensation that we may receive
under Paragraph 7 all transfer taxes, if any, paid by you for our account with
respect to sales of Units made through our efforts. We agree to pay our
proportionate share of any amount asserted against and discharged by you and the
other Additional Sellers, or any of them, based on the claim that you and the
Additional Sellers constitute an association, unincorporated business, or other
separate entity, including any expense incurred in defending against such claim.
10. (a) We agree to indemnify, hold harmless, and defend you, the General
Partner, each Partnership, each Trading Advisor, and any other Commodity Broker
for a Partnership against any loss, claim, damage, liability, cost, and expense,
joint or several (including attorneys' and accountants' fees and expenses
reasonably incurred in investigating
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or defending any demands, claims, or lawsuits), to which you or any indemnified
party may become subject under the 1933 Act, the 1934 Act, the CEAct, the
securities law of any jurisdiction, or otherwise (including in connection with
the settlement of claims approved in advance by us and in connection with any
administrative proceedings), in respect of the offer or sale of Units, insofar
as such loss, claim, damage, liability, cost, or expense arises out of, or is
based upon a breach by us of any representation, warranty, or agreement in this
Agreement, or the failure by us to perform any covenant made by us herein. The
indemnity agreement in this subparagraph (a) shall be in addition to any
liability that we may otherwise have and will extend, upon the same terms and
conditions, to each person, if any, who would be deemed a controlling person
(within the meaning of Section 15 of the 0000 Xxx) of you, the General Partner,
any Partnership, any Trading Advisor, or any other Commodity Broker.
(b) Promptly after receipt by an indemnified party under subparagraph (a)
above of notice of the commencement of any action, claim, or proceeding to which
such subparagraph may apply, the indemnified party shall notify the indemnifying
party in writing of the commencement thereof if a claim in respect thereof is to
be made against the indemnifying party thereunder; but the omission so to notify
the indemnifying party shall not relieve the indemnifying party from any
liability which the indemnifying party may have to the indemnified party
otherwise than under such subparagraph, except to the extent that such omission
has materially prejudiced the indemnifying party. If any action, claim, or
proceeding is brought against an indemnified party and the indemnified party
notifies the indemnifying party of the commencement thereof as provided above,
the indemnifying party shall be entitled to participate therein and, to the
extent that the indemnifying party desires, to assume the defense thereof with
counsel selected by the indemnifying party and approved by the
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indemnified party, such approval not to be unreasonably withheld. After notice
from the indemnifying party to the indemnified party of the indemnifying party's
election so to assume the defense thereof as provided above, the indemnifying
party shall not be liable to the indemnified party under subparagraph (a) for
any legal and other expenses subsequently incurred by the indemnified party in
connection with the defense thereof, other than reasonable costs of
investigation.
(c) Notwithstanding subparagraph (b), if, in any action, claim, or
proceeding as to which indemnification is or may be available under subparagraph
(a) above, an indemnified party reasonably determines that its interests are or
may be adverse, in whole or in part, to the indemnifying party's interests or
that there may be legal defenses available to the indemnified party which are
inconsistent with the defenses available to the indemnifying party, the
indemnified party may retain its own counsel in connection with such action,
claim, or proceeding, and shall be indemnified by the indemnifying party for any
legal and other expenses reasonably incurred in connection with investigating or
defending such action, claim, or proceeding.
(d) In no event will an indemnifying party under this Agreement be liable
for the fees and expenses of more than one counsel for any one indemnified party
in connection with any one action, claim, or proceeding or in connection with
separate but similar or related actions, claims, or proceedings in the same
jurisdiction arising out of the same general allegations. The indemnifying
party will not be liable for any settlement of any action, claim, or proceeding
effected without the indemnifying party's express written consent, but if any
action, claim, or proceeding is settled with the indemnifying party's express
written consent or if there is a final judgment for the plaintiff in any such
action, claim, or
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proceeding, the indemnifying party shall indemnify, defend, and hold harmless an
indemnified party as provided in subparagraph (a) above.
11. We agree that under no circumstances shall we engage in any activities
hereunder in any jurisdiction unless (a) the Units have been registered or
qualified for sale under the securities laws thereof, and (b) we may lawfully so
engage in such activities therein.
12. We acknowledge receipt of copies of the Selling Agreement, the
Prospectus, and any Selling Literature provided to us pursuant to Paragraph 3
hereof, and confirm that in executing this Agreement we have relied thereon and
upon no other representations whatsoever, either written or oral. We hereby
confirm (a) that we have examined the Selling Agreement, the Prospectus and any
such Selling Literature, and we are familiar with the terms of the Units and
other terms of the offering, (b) that the information, if any, relating to us
which has been furnished by us or on our behalf expressly for use in connection
with the Registration Statements, the Prospectus, and any Selling Literature
does not contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein (in the case of the Prospectus and any Selling Literature, in light of
the circumstances under which such statements were made) not misleading, (c)
that we are willing to accept the responsibilities of an Additional Seller under
the 1933 Act and the CEAct, and (d) that we are willing to proceed with the
offering of Units in the manner contemplated. Further, we understand that you
may approve of or object to any further amendments to the Registration
Statements, the filing of one or more additional registration statements and
amendments thereto, or amendments or supplements to the Prospectus and any
Selling Literature, without our consent or approval. With respect to the
Selling Agreement, we understand that you may in your discretion exercise any
right of
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cancellation or termination and consent to such other changes in the Selling
Agreement as you may approve without our consent or approval. You agree that
you will: (a) notify us of any such amendment to the Registration Statements,
any additional registration statement and any amendment thereto, and shall
provide a copy of same to us upon our written request; (b) notify us of any
amendment or supplement to the Prospectus or any Selling Literature, and cause a
copy of same to be furnished to us; and (c) notify us of any material change in
the Selling Agreement.
13. We agree that you shall be under no liability (except for your own
lack of good faith and for obligations expressly assumed by you hereunder) to us
in respect of any matters connected herewith or action taken by you pursuant
hereto for, or in respect of, the form of or the statements contained in the
Registration Statements, any additional registration statement, the Prospectus,
any Selling Literature, or any amendment or supplement to any of the foregoing
documents; the qualification of the Units for sale under the laws of any
jurisdiction; or any matter in connection with any of the foregoing; PROVIDED,
HOWEVER, that nothing in this Paragraph 13 shall be deemed to relieve you from
any liability imposed by the 1933 Act.
14. Nothing contained herein shall constitute us as partners with you or
with other Additional Sellers, and the obligations of ourselves and of all other
Additional Sellers are several and not joint.
15. Any notice from you to us at the address set forth below shall be
deemed to have been duly given if mailed, telexed, telegraphed, telecopied, or
telephoned and subsequently confirmed in writing to us.
16. This Agreement shall be construed in accordance with the internal laws
of the State of New York, without regard to principles of conflicts of laws.
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Your acceptance of this Agreement and approval hereof shall be indicated below,
whereupon this Agreement shall constitute a binding agreement between us.
Very truly yours,
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Print or Type Name of Additional Seller
By:
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(Signature of Authorized Signatory)
Name:
--------------------------------
Title:
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Address:
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Attention:
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Telephone No.:
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Telex No.:
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Telecopier No.:
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Type of Organization (Corporation,
Partnership or Other Entity):
---------
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State or Other Jurisdiction Where
Organized:
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Accepted as of ______________:
Xxxx Xxxxxx Xxxxxxxx Inc.
By:
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(Signature of Authorized Officer)
Name:
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Title:
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SCHEDULE A TO ADDITIONAL SELLER AGREEMENT
NO. OF UNITS
SEC FILE NO. EFFECTIVE DATE PARTNERSHIP REGISTERED
------------ -------------- ----------- ----------
33-80146 9/15/94 Global Balanced 2,000,000*
33-80146 9/15/94 Strategic 4,000,000*
33-80146 9/15/94 Technical 4,000,000*
333-00494 1/31/96 Global Balanced 5,000,000
333-00494 1/31/96 Strategic 6,000,000
333-00494 1/31/96 Technical 9,000,000
333-3222 4/30/96 Global Balanced 1,000,000
333-3222 4/30/96 Strategic 2,500,000
333-3222 4/30/96 Technical 5,000,000
333-47831 5/__/98 Technical 5,000,000
333-47829 5/__/98 Select 1,500,000
______________________
* Units allocated after SEC effectiveness.
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