FORM OF SELLING DEALER AGREEMENT
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Ladies and Gentlemen:
In connection with the registered public offering of 1,234,420 shares
of common stock ("Securities") for the 1838 Bond-Debenture Trading Fund (Fund)
through a transferable rights offering for which we are acting as dealer manager
("Offering"), you may be offered the right as a selected dealer to purchase as
principal a portion of such Securities not purchased prior to the expiration of
the rights offering. This will confirm our mutual agreement as to the general
terms and conditions applicable to your participation in any such selected
dealer group.
1. CONDITIONS OF OFFERING; ACCEPTANCE AND PURCHASES. The Offering will
be subject to delivery of the Securities and their acceptance by us, the
approval of all legal matters by counsel and the satisfaction of other
conditions, and on the basis of reservation of Securities or an allotment
against subscription. We will advise you by telecopy, telex or other form of
written communication ("Written Communication", which term may include a
prospectus, of the particular method and supplementary terms and conditions
(including, without limitation, the information as to price and the offering
date referred to in Section 2(b) hereof) of the Offering. 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 you with respect to the Offering should be sent to Boenning &
Scattergood, Inc. We may close the subscription books at any time in our sole
discretion without notice, and we reserve the right to reject any acceptance in
whole or in part.
Unless notified otherwise by us, Securities purchased by you shall be
paid for on such date as we shall determine, on one day's prior notice to you,
by wire transfer payable in immediately available funds to the order of Boenning
& Scattergood, Inc., in an amount equal to the Price (as hereinafter defined)
or, if we shall so advise you, at such Price less the Concession (as hereinafter
defined). If Securities are purchased and paid for at such Price, such
Concession will be paid after the termination of the provisions of Section 2(b)
hereof with respect to such Securities. Unless notified otherwise by us, payment
for and delivery of Securities purchased by you shall be made through the
facilities of The Depository Trust Company, if you are a member, unless you have
otherwise notified us prior to the date specified in a Written Communication to
you from us or, if you are not a member, settlement may be made through a
correspondent who is a member pursuant to instructions which you will send to us
prior to such specified date.
2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
(a) THE OFFERING. We will make available to you as soon as practicable
after sufficient copies are made available to us by the issuer of the Securities
such number of copies of the final prospectus relating thereto as you may
reasonably request for the purposes contemplated by the Securities Act and the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and the
applicable rules and regulations of the Securities and Exchange Commission
thereunder.
You represent and warrant that you are familiar with Rule 15c2-8 under
the Exchange Act relating to the distribution of final prospectuses and agree
that you will comply therewith.
You agree that in purchasing Securities you will rely upon no statement
whatsoever, written or oral, other than the statements in the final prospectus
and any marketing materials delivered to you by us. You will not be authorized
by the issuer or by us to give any information or to make any representation not
contained in the prospectus in connection with the sale of such Securities.
(b) OFFER AND SALE TO THE PUBLIC. The Offering of Securities is made
subject to the conditions referred to the prospectus relating to the Offering
and to the terms and conditions set forth in this Agreement. We will inform you
by a Written Communication of the public offering price (which shall be the
Subscription Price, as that term is used the in the Dealer Manager Agreement we
have signed with the Fund), the selling concession, the reallowance (if any) to
dealers and the time when you may commence selling Securities to the public.
After such public offering has commenced, we may change the public offering
price, the selling concession and the reallowance to dealers. The offering
price, selling concession and reallowance (if any) to dealers at any time in
effect with respect to the Offering are hereinafter referred to, respectively,
as the "Public Offering Price," the "Concession" and the "Reallowance." The
Concession is set forth is Appendix A. Until the provisions of this Section 2(b)
shall be terminated pursuant to Section 3 hereof, you 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 are either members in good standing of the NASD who
agree to abide by the applicable rules of the NASD (see Section 2(d) below) or
foreign banks, dealers or institutions not eligible for membership in the NASD
who represent to you that they will promptly reoffer such Securities at the
Public Offering Price and will abide by the conditions with respect to foreign
banks, dealers and institutions set forth in Section 2(d) hereof.
(c) OVER-ALLOTMENT; STABILIZATION; UNSOLD ALLOTMENTS. We may be
authorized to over-allot in arranging sales to Selected Dealers, to purchase and
sell Securities for long or short account and to stabilize or maintain the
market price of the Securities. You agree that upon our request at any time and
from time to time prior to the termination of the provisions of Section 2(b)
hereof with respect to any Offering, you will report to us the amount of
Securities purchased by you pursuant to such Offering which then remain unsold
by you and will, upon our request at any such time, sell to us for our account
such amount of such unsold Securities as we may designate at the Subscription
Price less an amount to be determined by us not in excess of the Concession. If,
prior to the later of (a) the termination of the provisions of Section 2(b)
hereof with respect to any Offering, or (b) the covering by us of any short
position created by us in connection with such Offering for our account, we
purchase or contract to purchase for our account in the open market or otherwise
any Securities purchased by you under this Agreement as part of such Offering,
you agree to pay us on demand an amount equal to the Concession with respect to
such Securities (unless you shall have purchased such Securities pursuant to
Section 1 hereof at the Public Offering Price and you have not received or been
credited with any Concession, in which case we shall not be obligated to pay
such Concession to you pursuant to Section 1) plus transfer taxes and broker's
commissions or dealer's xxxx-up, if any, paid in connection with such purchase
or contract to purchase.
(d) NASD. You represent and warrant that you are actually engaged in
the investment banking or securities business and either are a member in good
standing of the NASD or, if you are not such a member, you are a foreign bank,
dealer or institution not eligible for membership in the NASD which agrees to
make no sales within the United State, its territories or its possessions or to
persons who are citizens thereof or residents therein, and in making other sales
to comply with the NASD's interpretation with respect to free-riding and
withholding. You further represent, by your participation in an Offering, that
you have provided to us all documents and other information required to be filed
with respect to you, any related person or any person associated with you 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.
You agree that, in connection with any purchase or sale of the
Securities wherein a selling concession, discount or other allowance is received
or granted, you will (a) if you are a member of the NASD, comply with all
applicable interpretive material ("IM") and Conduct Rules of the NASD,
including, without limitation, IM 2110-1 (relating to Free-Riding and
Withholding) and Conduct Rule 2740 (relating to Selling Concessions, Discounts
and Other Allowances) or (b) if you are a foreign bank or dealer or institution
not eligible for such membership, comply with IM 2110-1 and with Conduct Rules
2730 (relating to Securities Taken in Trade), 2740 (relating to Selling
Concessions) and 2750 (relating to Transactions With Related Persons) as though
you were such a member and Conduct Rule 2420 (relating to Dealing with
Non-Members) as it applies to a non-member broker or dealer in a foreign
country.
(e) RELATIONSHIP AMONG UNDERWRITER AND SELECTED DEALERS. We may buy
Securities from or sell Securities to any Selected Dealer and, with our consent,
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
shall have full authority to take such action as we deem advisable in all
matters pertaining to any Offering under this Agreement. You are not authorized
to act as agent for us or the issuer or other seller of any Securities in
offering Securities to the public or otherwise. We shall be under no obligation
to you except for obligations assumed hereby or in any Written Communication
from us in connection with any Offering. Nothing contained herein or in any
Written Communication from us shall constitute the Selected Dealers an
association or partners with us or with one another. If the Selected Dealers,
among themselves or with us, should be deemed to constitute a partnership for
Federal income tax purposes, then you 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. You authorize
us, in our discretion, to execute and file on your behalf such evidence of that
election as may be required by the Internal Revenue Service. In connection with
any Offering you shall be liable for your proportionate amount of any tax,
claim, demand or liability that may be asserted against you alone or against one
or more Selected Dealers participating in such Offering, or against us, based
upon the claim that the Selected Dealers, or any of them constitute an
association, an unincorporated business or other entity, including, in each
case, your proportionate amount of any expense incurred in defending against any
such tax, claim, demand or liability.
(f) BLUE SKY LAWS. Upon application to us, we shall inform you as to
any advice we have received from counsel concerning the jurisdictions in which
Securities have been qualified for sale or are exempt under the securities or
blue sky laws of such jurisdictions, but we do not assume any obligation or
responsibility as to your right to sell Securities in any such jurisdiction.
(g) COMPLIANCE WITH LAW. You agree that in selling Securities pursuant
to the Offering (which agreement shall also be for the benefit of the issuer or
other seller of such Securities), you will comply with all applicable laws,
rules and regulations, including 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 or other
regulatory authority having jurisdiction over the Offering and the applicable
laws, rules and regulations specified in Section 2(a) hereof. Without limiting
the foregoing, (a) you agree that, at all times since you were invited to
participate in the Offering of Securities, you have complied with the provisions
of Regulation M applicable to such Offering, in each case after giving effect to
any applicable exemptions and (b) you represent that your incurrence of
obligations hereunder in connection with the Offering of Securities will not
result in the violation by you of Rule 15c3-1 under the Exchange Act, if such
requirements are applicable to you.
3. TERMINATION; SUPPLEMENTS AND AMENDMENTS. This Agreement shall
continue in full force and effect until terminated by a written instrument
executed by each of the parties hereto. This Agreement may be supplemented or
amended by us by written notice thereof to you, and any such supplement or
amendment to this Agreement shall be effective with respect to the 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
Section 2(b) hereof with regard to any Offering will terminate at the close of
business on the 30th day after the commencement of the public offering of the
Securities to which such Offering relates, but in our discretion may be extended
by us for a further period not exceeding 30 days and in our discretion, whether
or not extended, may be terminated at any earlier time.
4. SUCCESSORS AND ASSIGNS. This Agreement shall be binding on, and
inure to the benefit of, the parties hereto and other persons specified in
Section 1 hereof, and the respective successors and assigns of each of them.
5. GOVERNING LAW. This Agreement and the terms and conditions set forth
herein together with such supplementary terms and conditions as may be contained
in any Written Communication from us to you in connection therewith shall be
governed by, and construed in accordance with, the laws of the Commonwealth of
Pennsylvania applicable to contracts made and to be performed within the
Commonwealth of Pennsylvania.
Please confirm by signing and returning to us the enclosed copy of this
Agreement that your subscription to or your 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 3 hereof; together with and subject to any
supplementary terms and conditions contained in any Written Communication from
us in connection with such Offering, all of which shall constitute a binding
agreement between you and us, individually or as representative of any
Underwriters, (ii) confirmation that your representations and warranties set
forth in Section 2 hereof are true and correct at that time, (iii) confirmation
that your agreements set forth in Sections 1 and 2 hereof have been and will be
fully performed by you to the extent and at the times required thereby and (iv)
acknowledgment that you have requested and received from us sufficient copies of
the final prospectus or offering circular, as the case may be, with respect to
the Offering in order to comply with your undertakings in Section 2(a) hereof.
Please forward two executed copies of this Selling Dealer Agreement to Boenning
& Scattergood, Inc., Attn: Xxxxx Xxxxxxx, 4 Tower Bridge, 000 Xxxx Xxxxxx Xxxxx,
Xxxxx 000, Xxxx Xxxxxxxxxxxx, XX 00000-0000, Telephone No.: (000) 000-0000 and
Facsimile No.: (000) 000-0000.
Very truly yours,
BOENNING & SCATTERGOOD, INC.
By:
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Name: Xxxxx Xxxxxxx
Title: Vice President, Equity Trading
CONFIRMED: , 2003
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(Name of Dealer)
by:
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Name:
Title:
Address:
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Telephone:
Fax:
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Appendix A
Concession to Dealers who signed the Soliciting Dealer Agreement with respect to
the Rights Offering: _______________
Concession to all other Dealers: _____________
