EXHIBIT 1.1
▇▇▇▇▇▇▇ PRESERVATION, INC.
MAXIMUM OF 2,347 SHARES
DEALER AGREEMENT
JANUARY ____, 1999
Coastal Financial Security, Incorporated
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear Sir/Madam:
▇▇▇▇▇▇▇ Preservation, Inc. ("the Company") is a Florida corporation
with its principal executive offices located at ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. It is the owner of The ▇▇▇▇▇▇▇ Mobile Home Park, 2555 PGA
Boulevard, Palm Beach Gardens (the "Park") and the homeowners' association for
the Park for purposes of the Florida Mobile Home Act. The Company seeks to
engage you in assisting it in selling certain common stock of the Company. The
authorized stock of the Company includes 10,000 shares of common stock, having a
par value of $0.01 per share (the "Common Stock"), and 400 shares of preferred
stock. Seven (7) shares of Common Stock and 235 shares of preferred stock are
issued and outstanding.
The Company proposes to offer for sale on a "best efforts" basis up to
2,347 shares of Common Stock (collectively the "Shares," each a "Share") (the
"Offering"). There is no minimum number of Shares to be sold in the Offering.
The Shares are being offered at a subscription price of $1,000.00 per Share
("Share Price") only to the owners of manufactured or mobile homes who lease
lots in the ▇▇▇▇▇▇▇ Mobile Home Park, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇ Homeowners"). The Offering is further described in a
Prospectus dated ____________, 1999, which Prospectus is part of a Registration
Statement on Form SB-1 (File Number 333-65057) filed with the Securities and
Exchange Commission (the "SEC") under the Securities Act of 1933, as amended
(the "1933 Act"), on September 30, 1998 and amended on January __, 1999 (the
"Registration Statement").
All capitalized terms not otherwise defined herein shall have the
meanings ascribed to such terms in the Registration Statement.
SECTION 1. Appointment of Coastal Financial Security, Incorporated as Agent:
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Compensation to the Agent.
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(a) Subject to the terms and conditions herein set forth, the Company
hereby appoints Coastal Financial Security, Incorporated (the "Agent" or "you"),
as its sole dealer to solicit subscriptions for Shares on behalf of the Company.
On the basis of the representations, warranties, covenants and agreements set
forth herein, the Agent accepts such appointment and agrees to consult with and
advise the Company as to the matters described in this Section 1 and to solicit
subscriptions for Shares from ▇▇▇▇▇▇▇ Homeowners in Florida in accordance with
this Agreement and in accordance with the terms of the Offering set forth in the
Prospectus; provided, however, that the Agent shall not be obligated to sell any
Shares or to take any action not in accordance with all applicable laws,
regulations, decisions or orders. It is presently contemplated that you, as
Agent, will comply with all requirements of the National Association of
Securities Dealers, Inc. ("NASD") as they relate to your appointment as Agent in
this Agreement. The Agent shall not offer any Shares to, or solicit
subscriptions from, anyone other than the ▇▇▇▇▇▇▇ Homeowners.
(b) The Agent will consult with and advise the Company with respect
to the timing and sales strategy for the Offering.
(c) The Agent will assist the Company in transacting with prospective
subscribers as dictated by the Florida Securities and Investor Protection Act
and its regulations (collectively the "Florida Securities Act"), including
furnishing each prospective subscriber with the Prospectus prior to sale and
providing such person a written confirmation of the description of the
securities to be purchased before or at the time of the completion of the sale
of the security, pursuant to the 1933 Act and the Florida Securities Act.
(d) The Company acknowledges that it has retained the Agent in
connection with the Offering and that, in such capacity, only personnel employed
by the Agent and such other personnel as are assigned for the specific purposes
contemplated by this Agreement to be performed by the Agent will be involved in
providing the services described herein.
(e) The Agent will transmit executed Subscription Agreements
substantially in the form attached hereto as Exhibit "A" and investors' funds
(made payable to "▇▇▇▇▇▇▇ Preservation, Inc.") received by it thereunder to the
Company by mail on or before twelve noon, E.D.T., of the business day next
following receipt of such funds and Subscription Agreements by the Agent. If the
Offering is made, the Company will cause to be paid to the Agent the greater of
(i) a one percent (1%) commission on the proceeds of all the shares of Common
Stock sold under the terms of this Agreement or (ii) $8,800.00. If the Offering
is not made, for any reason, no fees shall be payable to the Agent. The fees
specified in this subsection shall be payable in immediately available funds on
or about the Closing Date for the Offering, as described in Section 3.
(f) The appointment of the Agent hereunder shall terminate upon the
earliest of (i) the sale of all 2,347 Shares offered in the Offering, (ii) the
date on which the Company delivers to the Agent a notice certifying that the
Company has elected to cancel and
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withdraw the Offering (the "Withdrawal Date"), (iii) the Termination Date, as
defined in Section 10 hereof, (iv) termination by the Agent in accordance with
Section 10, or (v) the Closing Date.
SECTION 2. Offering. The Shares are to be offered in the Offering at the
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Share Price and are subject to the terms stated in the Registration Statement
and Prospectus, including, but not limited to, the sections entitled
"Description of Securities" and "Plan of Distribution of MPI Common Shares"
therein.
SECTION 3. Closing: Release of Funds and Delivery of Certification.
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(a) If all conditions precedent to the consummation of the Offering
are satisfied, including the Company's receipt of investors' funds and executed
Subscription Agreements as described in Section 1, the Company will (i) issue
certificates for the shares of Common Stock with respect to the Shares sold in
the Offering and (ii) release for delivery or deliver such certificates.
Certificates for Shares shall be delivered directly to the subscribers in
accordance with their respective Subscription Agreements.
(b) The hour and date upon which the Company shall (i) release for
delivery the certificates for Shares sold and (ii) receive the investors' funds
due to the Company from the Agent is referred to herein as the "Closing Date."
In the event that the Closing Date shall not occur for any reason and a
subscriber has deposited funds with the Agent, such funds shall be promptly
returned to the subscriber. Funds received by the Agent for which the Company
does not accept a Subscription Agreement shall also be promptly returned to the
subscriber.
SECTION 4. Representations and Warranties of the Company. The Company
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represents and warrants to the Agent and agrees as follows:
(a) The Registration Statement does not, and at the Closing Date will
not, include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided that this representation and warranty shall not apply to
statements and/or omissions from the Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by the Agent
expressly for use in the Prospectus.
(b) The accountants who certify the financial statements and
supporting schedules included or incorporated by reference in the Registration
Statement are independent certified public accountants with respect to the
Company within the meaning of Regulation S-X under the 1933 Act.
(c) The financial statements of the Company, audited and unaudited,
included in the Prospectus present fairly the financial position of the Company
at the dates indicated and the results of its operations for the periods
specified, and such financial statements were prepared in conformity with
generally accepted accounting principles applied on a consistent basis for the
periods presented.
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(d) There are no contracts or documents which are required to be
described in the Registration Statement or the Prospectus or filed as exhibits
thereto which have not been so described and filed as required.
(e) Since the filing of the Registration Statement and Prospectus,
there has been no substantial adverse change in the condition, financial or
otherwise, of the Company and no distribution of any kind has been made upon any
outstanding stock of the Company.
(f) Except as set forth in the Registration Statement and Prospectus,
there are no suits pending or to the knowledge of the Company threatened against
the Company which affect any substantial portion of its property or
substantially affect its business.
(g) As of the date of the Registration Statement and Prospectus, the
Company is a corporation in active status under the laws of the State of Florida
with full power and authority to conduct its business as described in the
Registration Statement and Prospectus.
(h) The securities described in this Agreement are registered
according to the Florida Securities Act. As of the date of the Prospectus, there
were seven (7) shares of Common Stock issued and outstanding.
(i) The Shares in this Offering have been duly and validly authorized
for issuance and, when issued and delivered by the Company against payment of
the consideration therefor, the Shares will be legally issued, fully paid and
nonassessable. The terms and provisions of the Shares conform and will conform
in all material respects to the description thereof contained in the Prospectus.
(j) The consummation of the transactions described in the Prospectus,
the execution and delivery of this Agreement and the consummation of the
transactions herein contemplated will not conflict with or constitute a
violation of the articles of incorporation or bylaws of the Company.
(k) The Company has not granted or authorized nor made prior
arrangements to grant or authorize any options, warrants or rights to purchase
the Company's capital stock other than as described in the Registration
Statement and Prospectus.
(l) This Agreement has been duly executed and delivered by the
Company and is the legal, valid and binding agreement of the Company enforceable
in accordance with its terms, subject, as to enforceability, to bankruptcy,
insolvency, reorganization, moratorium and other laws of general applicability
relating to or affecting creditors' rights, and to general principles of equity.
SECTION 5. Representations and Warranties of the Agent. The Agent
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represents and warrants to the Company and agrees as follows:
(a) The Agent is registered as a broker-dealer in accordance with the
Securities and Exchange Act of 1934, as amended, and the Florida Securities Act
and is a member of the NASD. It is subject to insurance coverage by the
Securities Investor Protection
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Corporation and will maintain the registrations, qualifications and memberships
that are referred to in this subsection throughout the term of the Offering.
(b) To the knowledge of the Agent, no action or proceeding is pending
against the Agent concerning the Agent's activities as a broker or dealer that
would materially adversely affect the Company's offering of the Shares.
(c) The Agent will assist in the offering of the Shares only in the
State of Florida and in accordance with the Florida Securities Act.
(d) The Agent, in connection with the offer and sale of the Shares
and in the performance of its duties and obligations under this Agreement,
agrees to comply with all applicable federal laws, the laws of the State of
Florida and the rules and regulations of the NASD, and will not, in connection
with its efforts hereunder to sell the Shares, make any representation or give
any information other than as contained in the Prospectus or in any marketing
materials prepared by the Company with or without the assistance of the Agent.
(e) The Agent is a corporation in active status and authorized to
transact business under the laws of the State of Florida.
(f) The undersigned individual acting on behalf of the Agent has all
requisite power and authority to enter into this Agreement on behalf of the
Agent. This Agreement has been duly authorized, executed and delivered by the
Agent and is a valid agreement on the part of the Agent, subject, as to
enforceability, to bankruptcy, insolvency, reorganization, moratorium and other
laws of general applicability relating to or affecting creditors' rights, and to
general principles of equity.
(g) Neither the execution of this Agreement nor the consummation of
the transactions contemplated hereby will result in any breach of any of the
terms or conditions of, or constitute a default under, the articles of
incorporation or bylaws of the Agent or any indenture, agreement or other
instrument to which the Agent is a party or violate any order directed to the
Agent of any court or any federal or state regulatory body or administrative
agency having jurisdiction over the Agent or its affiliates.
(h) The Agent knows of no person who rendered any services in
connection with the introduction of the Company to the Agent who will be
entitled to receive from the Agent or from the Company any finder's fees or
similar payments.
SECTION 6. Covenants of the Company. The Company hereby covenants with you
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as follows:
(a) The Company will notify you promptly after it shall receive
notice thereof, of the time when the Registration Statement or any subsequent
amendment to the Registration Statement has become effective or any supplement
to the Prospectus has been filed;
(b) The Company shall file with the Florida Department of Banking and
Finance the appropriate registration materials in order to comply with the laws
of the State of Florida applicable to the sale of the Shares (the "Blue Sky
Materials"). The Company will notify
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you of (i) the receipt of any comments from the SEC or any Florida regulatory
authority with respect to the Offering, (ii) the issuance by the SEC or any
other Florida regulatory authority of any order or other action suspending the
Offering or the use of the Prospectus or any other filing of the Company under
applicable Florida law or the threat of any such action, and (iii) the issuance
by the SEC or any Florida regulatory authority of any stop order suspending the
use of the Prospectus or of the initiation or threat of initiation of any
proceedings for that purpose.
(c) Other than the Prospectus or as permitted by applicable law, the
Company itself will not distribute any prospectus, offering circular or other
offering material in connection with the offer and sale of the Shares.
(d) The Company shall not be deemed to have accepted any subscription
offer accompanied by a check or comparable instrument until final payment has
been made on such check or instrument and the Company accepts the subscription
by executing the Subscription Agreement. While the Company shall have the right
to reject individual subscriptions in the Offering in its discretion, the
Company shall also reject individual subscriptions at the request of the Agent
based upon valid legal or regulatory criteria.
(e) The Company will give you notice of its intention to amend or
file any amendment or supplement to the Prospectus which differs from the
Prospectus most recently filed with the SEC.
(f) The Company has or will deliver to you at least one (1) conformed
copy of the Registration Statement and the Blue Sky Materials, as amended.
(g) The Company will furnish to you, from time to time, such number
of copies of the Prospectus (as amended or supplemented) as you may reasonably
request for the purposes contemplated by the applicable rules and regulations of
the NASD.
(h) As of the effective date of the Registration Statement and
continuing through the Closing Date, the Company will comply, at its own
expense, with all requirements imposed upon it by the SEC and the Florida
Department of Banking and Finance, so far as necessary to permit the continuance
of sales of shares of Common Stock during such period in accordance with the
provisions hereof and the Prospectus, provided, however, that the Company may,
in its sole discretion, withdraw from selling Shares after prior written notice
to and consultation with the Agent.
(i) If any event relating to or affecting the Company shall occur, as
a result of which it is necessary, in the reasonable opinion of counsel for the
Company to amend or supplement the Prospectus in order to make the Prospectus
not misleading in light of the circumstances existing at the time it is
delivered to a prospective subscriber, the Company will forthwith prepare and
furnish to you a reasonable number of copies of an amendment or amendments of,
or a supplement or supplements to, the Prospectus which will amend or supplement
the Prospectus so that, as amended or supplemented, it will not contain any
untrue statement of any material fact or omit to state any material fact
necessary in order to make the statements therein, in light of the circumstances
existing at the time the Prospectus is delivered to a prospective subscriber or
a subscriber, not misleading.
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(j) The Company will use the net proceeds from the sale of the Shares
in the manner set forth in the Prospectus under the caption, "Use of Proceeds."
SECTION 7. Payment of Expenses. The ▇▇▇▇▇▇▇ Resort Partnership, of which
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the Company is a general partner, will pay all reasonable expenses in connection
with the Offering and otherwise incident to the performance of the obligations
of the Company under this Agreement, including the following: (i) the
preparation, issuance and delivery of certificates for the Shares to the
subscribers in the Offering, (ii) the fees and disbursements of the Company's
legal counsel and accountants, (iii) the filing fees, if any, incurred in
connection with the qualification of the Shares under the Blue Sky laws, (iv)
the printing and delivery to you, in such quantities as you shall reasonably
request, of copies of the Prospectus and all other documents in connection with
the Offering and this Agreement, (v) the cost of printing all stock certificates
and all other documents related to the Offering, and (vi) your commission as
described in Section 1 of this Agreement.
SECTION 8. Conditions to Closing. Unless otherwise agreed upon by you and
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the Company, the consummation of the Offering is subject to the conditions that
(i) all representations and warranties and other statements of the Company and
you herein are, as applicable, at and as of the commencement of the Offering or
as of the Closing Date, true and correct in all material respects, (ii) the
Company and you shall have performed in all material respects all obligations
hereunder to be performed on or before such dates, (iii) no stop order
suspending the use of the Prospectus shall have been issued under any applicable
law or proceedings thereof initiated or threatened by any regulatory authority,
and (iv) no order or other action suspending the consummation of the
transactions described in the Prospectus shall have been issued or proceeding
therefor initiated or threatened by the SEC or any other regulatory authority.
SECTION 9. Indemnification.
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(a) The Company agrees to indemnify and hold harmless you, your
officers, directors, agents and each person, if any, who controls you within the
meaning of Section 15 of the 1933 Act, as amended, against all claims or
liabilities, joint or several, to which you or any of them may become subject
under all applicable federal and state securities laws, and to reimburse you and
such persons for any expenses (including reasonable fees and disbursements of
counsel) incurred by you or any of them in connection with investigating,
preparing or defending any actions, to the extent such claims, liabilities or
actions are based upon: (i) any untrue statement or omission of material fact
contained in the Registration Statement, (ii) any Blue Sky application or other
instrument executed or supplied by the Company filed in any state or province to
qualify or register any or all of the Shares under the securities laws thereof,
or (iii) the Prospectus (or any amendment or supplement thereto) distributed to
▇▇▇▇▇▇▇ Homeowners in connection with the Offering. The Company is not liable to
the Agent, however, for any claim or liability arising out of any untrue
statement or material omission from the Prospectus (or any amendment or
supplement thereto) made in reliance upon information furnished to the Company
by the Agent or not corrected by the Agent upon its review of such information
contained in the Registration Statement and/or the Prospectus.
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(b) You agree to indemnify and hold harmless the Company, its
directors, officers, agents, and each person, if any, who controls the Company
within the meaning of section 15 of the 1933 Act against all claims or
liabilities, joint or several, to which they, or any of them, may become subject
under all applicable federal and state laws, and to reimburse the Company and
such persons for any expenses (including reasonable fees and disbursements of
counsel) incurred by them, in connection with investigating, preparing or
defending any actions, to the extent such claims, liabilities or actions arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with information furnished in
writing to the Company by you expressly for use in the Prospectus.
(c) Promptly after receipt by an indemnified party under this Section
9 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 9, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party unless the failure to notify
prejudiced or adversely affected the indemnifying party in some material
respect.
(d) If any such claim or action shall be brought against an
indemnified party for which the indemnified party is seeking indemnification,
the indemnifying party shall be entitled to participate therein and, to the
extent that it wishes, jointly with any other similarly-notified indemnifying
party, to assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this
Section 9 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. However, any indemnified party shall have the right to
employ separate counsel in any such action and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the employment thereof has been specifically
authorized by the indemnifying party in writing; (ii) such indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party and, in the reasonable judgment of such
counsel, it is advisable for such indemnified party to employ separate counsel;
or (iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party.
(e) Each indemnified party, as a condition of the indemnity
agreements contained in Sections 9(a) and 9(b) shall use its best efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any settlement of any such
action effected without its written consent (which consent shall not be
unreasonably withheld), but, if the action is settled with its written consent,
or if there be a final judgment of the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold
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harmless any indemnified party from and against any loss or liability by reason
of such settlement or judgment.
(f) The agreements contained in this Section 9 and the
representations and warranties of set forth in this Agreement shall remain
operative and in full force and effect as specified in Section 11 of this
Agreement regardless of (i) any investigation made by or on behalf of you or
your officers, directors or controlling persons, or by or on behalf of the
Company or any officers, directors or controlling persons of the Company; (ii)
delivery of and payment for the Shares; or (iii) any termination of this
Agreement.
SECTION 10. Termination.
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(a) The Agent, at its election, may terminate this Agreement, and
neither party to this Agreement shall thereafter have any obligation to the
other hereunder if, at any time prior to the Closing Date, the Agent in its
reasonable discretion determines that a material adverse change has occurred in
the financial condition or operations of the Company since the date of this
Agreement. This Agreement may be terminated by the Agent, with respect to the
Agent's obligations hereunder, only by notifying the Company in writing of the
same.
(b) In the event the Company or the Agent fails to meet the
conditions specified in Section 8 hereof within the period specified in, and in
accordance with the Prospectus, at the election of either party hereto this
Agreement shall terminate and neither party to this Agreement shall thereafter
have any obligation to the other hereunder provided that the party seeking to
terminate the Agreement must provide notice in writing of the same to the other
party.
(c) The term "Termination Date" as used in this Agreement shall mean
___________, ____ unless the Offering is extended by the Company to a date no
later than ____________, ____ by written notice delivered to the Agent by the
Company.
SECTION 11. Survival. The respective agreements, representations, warranties
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and other statements of or respecting the Company and you, as set forth in this
Agreement, shall remain in full force and effect until the earliest of the sale
of the Maximum Number of Shares, the Termination Date, the events described in
Section 10, or the Withdrawal Date.
SECTION 12. Counterparts. This Agreement may be executed simultaneously in
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one or more counterparts, each of which shall be deemed an original, and all of
which together shall constitute one instrument.
SECTION 13. Severability. If one or more provisions of this Agreement shall
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be invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired.
SECTION 14. Miscellaneous.
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(a) Notices hereunder, except as otherwise provided herein, shall be
given in writing or by telefacsimile, addressed (i) to the Agent, at the Agent's
mailing address, ▇.▇. ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, telefacsimile number
(▇▇▇) ▇▇▇-▇▇▇▇ and (ii) to the Company, at
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the Company's principal office (Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, President),
telefacsimile number (▇▇▇) ▇▇▇-▇▇▇▇, with a copy to ▇▇▇▇ ▇▇▇▇▇▇ of Pennington,
Moore, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇, P.A., ▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, telefacsimile number (▇▇▇) ▇▇▇-▇▇▇▇.
(b) This Agreement is made solely for the benefit of and will be
binding upon the parties hereto and their respective successors, and no other
person will have any right or obligation hereunder. The term "successor" shall
not include any purchaser, as such, of any of the Shares.
(c) This Agreement shall be governed by and construed in accordance
with the laws of the State of Florida.
If the foregoing correctly sets forth the arrangement between the Company
and the Agent, please indicate acceptance thereof in the space provided below
for that purpose, whereupon this letter and your acceptance shall constitute a
binding agreement.
Very truly yours,
▇▇▇▇▇▇▇ PRESERVATION, INC.
By:______________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
President
Accepted as of the date
first above written
COASTAL FINANCIAL SECURITY, INCORPORATED
By:______________________________
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇.
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