EXHIBIT 1.1
$3,120,000
Consisting Of
Shares of Common Stock
1,200,000 Redeemable Common Stock Warrants
SELLING AGREEMENT
Dear Sirs:
1. We as Underwriter are offering for sale an aggregate of _________
shares (the "Shares") of Common Stock, $0.1 par value per share, and 1,200,000
Redeemable Common Stock Warrants (the "Warrants") of Trans Energy, Inc. (the
"Company") for aggregate gross proceeds of $3,120,000, which we have agreed to
purchase from the Company. In addition, we have been granted an option to
purchase from the Company up to an additional 15% of the Shares and Warrants
sold in the public offering (the "Option Securities") to cover over allotments
in connection with the sale of the Shares and the Warrants. The _________ Shares
and 1,200,000 Warrants being sold for an aggregate of $3,120,000 and the Option
Securities purchased are herein called the "Securities". The Securities and the
terms under which they are to be offered for sale by the Underwriter are more
particularly described in the Prospectus.
2. The Securities are to be offered to the public by the Underwriter
at the price per share set forth on the coverage page of the Prospectus (the
"Public Offering Price"), in accordance with the terms of offering thereof set
forth in the Prospectus.
3. The Underwriter is offering, subject to the terms and conditions
hereof, a portion of the Securities for sale to certain dealers who are actually
engaged in the investment banking or securities business and who are either (i)
members in good standing of the National Association of Securities Dealers, Inc.
(the "NASD") or (ii) dealers with their principal places of business located
outside the United States, its territories and its possessions and not
registered as brokers or dealers under the Securities Exchange Act of 1934, as
amended (the "1934 Act") who have agreed not to make any sales within the United
States, its territories or its possessions or to persons who are nationals
thereof or residents therein (such dealers who shall agree to purchase
Securities hereunder being herein called "Selected Dealers"), at the Public
Offering Price, less a selling concession (which may be changed) of not in
excess of $.___ per Share and $.___ per Warrant payable as hereinafter provided,
out of which concession an amount not exceeding $.___ per Share and $.___ per
Warrant may be reallowable by Selected Dealers to members of the NASD or foreign
dealers qualified as aforesaid. The Selected Dealers have agreed to comply with
the provisions of Section 2740 of the Conduct Rules of the NASD, and if any such
dealer is a foreign dealer and not a member of the NASD, such Selected Dealer
also has agreed to comply with the NASD's interpretation with respect to free-
riding and withholding, to comply, as though it were a member of the NASD, with
the provisions of Section 2730 and 2750 of such Conduct Rules, and to comply
with Section 2420 thereof as that Section applies to non-
member foreign dealers. The Underwriter may be included among the Selected
Dealers.
4. We shall have full authority to take such action as we may deem
advisable in respect of all matters pertaining to the public offering of the
Securities.
5. If you desire to purchase any of the Securities, your application
should reach us promptly by telephone or telegraph at our office at 00 Xxxxxxxx,
Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx Xxxxx, Telephone No.
(000)000-0000. We reserve the right to reject subscriptions in whole or in part,
to make allotments and to close the subscription books at any time without
notice. The Securities allotted to you will be confirmed subject to the terms
and conditions of this Agreement.
6. Any Securities purchased by you under the terms of this Agreement
may be immediately reoffered to the public in accordance with the terms of
offering thereof set forth herein and in the Prospectus, subject to the
securities or blue sky laws of the various states or other jurisdictions.
You agree to pay us on demand an amount equal to the Selected Dealer
concession as to any Securities purchased by you hereunder which, prior to the
termination of this Agreement, we may purchase or contract to purchase and, in
addition, we may charge you with any broker's commission and transfer tax paid
in connection with such purchase or contract to purchase. Certificates for
Common Stock delivered on such repurchases need not be the identical
certificates originally purchased.
You agree to advise us from time to time, upon request, of the number
of Securities purchased by you hereunder and remaining unsold at the time of
such request, and, if in our opinion any such Securities shall be needed to make
delivery of the Securities sold or over-allotted for our account you will,
forthwith upon our request, grant to us for our account the right, exercisable
promptly after receipt of notice from you that such right has been granted, to
purchase, at the Public Offering Price less the selling concession or such part
thereof as we shall determine, such number of Securities owned by you as shall
have been specified in our request.
No expense shall be charged to Selected Dealers. A single transfer
tax, if payable, upon the sale of the Securities by the Underwriter to you will
be paid when such Securities are delivered to you. However, you shall pay any
transfer tax on sales of Securities by you and you shall pay your proportionate
share of any transfer tax (other than the single transfer tax described above)
in the event that any such tax shall from time to time be assessed against you
and other Selected Dealers as a group or otherwise.
Neither you nor any other person is or has been authorized to give any
information or to make any representation in connection with the sale of the
Securities other than as contained in the Prospectus.
7. The first three paragraphs of Section 6 hereof will terminate
when we shall have determined that the public offering of the Securities has
been completed and upon telegraphic notice
to you of such termination, but, if not theretofore terminated, they will
terminate at the close of business on the 45th full business day after the date
hereof; provided, however, that we shall have the right to extend such
provisions for a further period or periods, not exceeding an additional 30 full
business days in the aggregate upon telegraphic notice to you.
8. For the purpose of stabilizing the market in the Securities, we
have been authorized to make purchases and sales of the Securities of the
Company, in the open market or otherwise, for long or short account, and in
arranging for sales, to overallot.
9. On becoming a Selected Dealer, and in offering and selling the
Securities, you agree to comply with all the applicable requirements of the
Securities Act of 1933, as amended (the "1933 Act"), and the 1934 Act. You
confirm that you are familiar with Rule 15c2-B under the 1934 Act relating to
the distribution of preliminary and final prospectuses for securities of an
issuer (whether or not the issuer is subject to the reporting requirements of
Section 13 or 15(d) of the 0000 Xxx) 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 of the 1934 Act, or the
rules and regulations thereunder.
10. Upon request, you will be informed as to the states and other
jurisdictions in which we have been advised that
the Securities are qualified for sale under the respective securities or blue
sky laws of such states and other jurisdictions, but we assume no obligation or
responsibility as to the right of any Selected Dealer to sell the Securities in
any state or other jurisdiction or as to the eligibility of the Securities for
sale therein. We will, if required, file a Further State Notice in respect of
the Securities pursuant to Article 23-A of the General Business Law of the State
of New York.
11. No Selected Dealer is authorized to act as our agent or otherwise
to act on our behalf, in offering or selling the Securities to the public or
otherwise or to furnish any information or make any representation except as
contained in the Prospectus.
12. Nothing will constitute the Selected Dealers an association or
other separate entity or partners with the Underwriter or with each other, but
you will be responsible for your share of any liability or expense based on any
claim to the contrary. We shall not be under any liability for or in respect of
value, validity or form of the Securities or the delivery of the certificates
for the Securities, or the performance by anyone of any agreement on its part,
or the qualification of the Securities for sale under the laws of any
jurisdiction, or for or in respect of any other matter relating to this
Agreement, except for lack of good faith and for obligations expressly assumed
by us in this Agreement and no obligation on our part shall be
implied herefrom. The foregoing provisions shall not be deemed a waiver of any
liability imposed under the 1993 Act.
Payment for the Securities sold to you hereunder is to be made at the
Public Offering Price less the above-mentioned selling concession at such time
and date as we may advise, at the office of X.X. Xxxx Inc., 00 Xxxxxxxx, Xxxxx
0000, Xxx Xxxx, Xxx Xxxx 00000, by a certified or official bank check in current
New York Clearing House funds, payable to the order to X.X. Xxxx Inc. against
delivery of certificates for the Securities. If such payment is not made at such
time, you agree to pay us interest on such funds at the prevailing brokers' loan
rate.
13. Notices should be addressed to us at the office of X.X. Xxxx Inc.,
as stated in paragraph 12 above. Notices to you shall be deemed to have been
duly given if telegraphed or mailed to you at the address to which this letter
is addressed.
14. If you desire to purchase any Securities, please confirm your
application by signing and returning to us your confirmation on the duplicate
copy of this letter enclosed herewith, even though you may have previously
advised us thereof by telephone or telegraph. Our signature hereon may be by
facsimile.
Very truly yours,
X.X Xxxx Inc.
By:__________________________
