SAGE, XXXXX & CO., INC.
000 Xxxx Xxxx Xxxxxx
0xx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Date: ________, 1997
SELECTED DEALER AGREEMENT
-------------------------
Dear Sirs:
Sage, Xxxxx & Co., Inc., the underwriter (the "Underwriter") named in
the Prospectus (as hereinafter defined) has agreed, subject to the terms and
conditions of that certain underwriting agreement (the "Underwriting Agreement")
dated ______________, 1997, between the Underwriter and Intervest Bancshares
Corporation (the "Issuer"), to act as exclusive agent for the Issuer and to use
its best efforts to sell up to 400,000 Units (the "Units"), each Unit consisting
of one share of Class A Common Stock of the Issuer and one Warrant to purchase
one share of Class A Common Stock of the Issuer. The Units are more particularly
described in the enclosed prospectus (the "Prospectus"), additional copies of
which will be supplied in reasonable quantities upon request.
The Underwriter is offering a part of the Units for sale by selected
dealers (the "Selected Dealers"), including yourself, who are registered with
the Securities and Exchange Commission (the "SEC") as broker-dealers under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and who are
members in good standing of the National Association of Securities Dealers, Inc.
(the "NASD"), on a "best efforts" basis.
The offering is subject to the delivery of the Units, and the
acceptance of the offering by the Underwriter, the approval of all legal matters
by counsel, and the terms and conditions herein set forth.
Subject to the foregoing, the Underwriter confirms its agreement with
you (sometimes herein called the "Dealer"') as follows:
1. Non-Exclusive Right to Offer and Sell. Underwriter hereby grants to
you the non-exclusive right to offer and sell the Units upon such terms as the
Underwriter shall from time to time determine and as set forth in the then
effective Prospectus relating to such Units. The amount of Units which the
Underwriter has initially determined to permit you to offer and sell is set
forth at the end of this letter, although the Underwriter reserves the right to
change such allotment. You agree (a) upon our request, to advise us of the
number of Units allotted to you which remain unsold; and (b) at our request, to
stop offering any such Units remaining unsold.
2. Compliance with Laws. A registration statement on Form SB-2 (the
"Registration Statement") with respect to the Units has been filed with the SEC
and has become effective. You agree to comply with the applicable requirements
of the Securities Act of 1933, as amended (the "1933 Act"), the 1934 Act and any
applicable rules and regulations issued under said Acts. No person is authorized
by the Issuer or by the Underwriter to give any information or to make any
representation other than those contained in the Prospectus in connection with
the sale of the Units.
3. Dealer Representations. Dealer represents that it is a member in
good standing of the NASD and agrees to abide by all of the NASD rules and
regulations, and any interpretations thereof, including, without limitation, the
NASD interpretation with respect to Free-Riding and Withholding and Rules 2420,
2730, 2740 and 2750 of the NASD Conduct Rules. Dealer also agrees to comply with
the requirements of all applicable Federal and State Laws and all rules and
regulations thereunder, and interpretations thereof, promulgated by any
regulatory agency having jurisdiction.
In the event that a domestic or foreign Dealer should sell or offer for
sale the Units in any jurisdiction outside the United States, Dealer also agrees
to comply with the laws, rules and regulations of any governmental or regulatory
body applicable within such foreign jurisdiction.
4. State Registrations. You will be informed by the Underwriter as to
the states in which we have been advised by counsel that the Units have been
qualified or registered for sale or are exempt under the respective securities
or "blue sky" laws of such states, but we have not assumed and will not assume
any obligation or responsibility as to the accuracy of such information or as to
the eligibility or right of any Selected Dealer to offer or sell the Units in
any state.
5. Underwriter Authority and Liability. The Underwriter shall have full
authority to take such action as it may deem advisable in respect of all matters
pertaining to the offering or arising thereunder. The Underwriter shall not be
under any liability to you with respect to any matter, except such as may be
incurred under the 1933 Act and the rules and regulations thereunder, except for
lack of good faith and except for obligations assumed by us in this Agreement,
and no obligation on our part shall be implied or inferred herefrom.
6. Payment and Procedures. All subscriptions for investments shall be
confirmed on forms of a type acceptable under the rules and regulations of the
NASD and in accordance with Rule 15c2-8 of the 1934 Act. If at least $4,200,000
in collected funds (as defined in the Escrow Agreement) have been received and
such subscriptions accepted by the Issuer by ____________, 1997, the Issuer may
close the Offering as to those subscribers (the "First Closing Date"). Until the
First Closing Date, you shall promptly, upon receipt of any and all checks,
drafts, and money orders received from prospective purchasers of the Units,
transmit, in accordance with Rule 15c2-4(b) of the 1934 Act, such items to
Manufacturers and Traders Trust Company, as Escrow Agent, for deposit into an
account entitled "Intervest Bancshares Corporation Escrow Account", but in any
event such transmittal to the Escrow Agent shall be made by noon of the next
business day after your receipt of such funds. Any Units remaining unsold after
the First Closing Date may continue to be offered and sold for up to 150 days
after the First Closing Date. After the First Closing Date, you shall promptly
transmit any and all checks, drafts, and money orders received from prospective
purchasers of the Units to the Underwriter by noon of the next business day
after you receive such funds. At the same time you deliver funds received to the
Escrow Agent, or directly to the Underwriter, you shall also deliver to
Underwriter, a written account of each purchaser which sets forth, among other
things, the name, address and tax identification number of the purchaser, the
number of Units purchased, and the amount paid therefor which shall be
accompanied by a copy of the check and any transmittal letter to the Escrow
Agent.
You agree to be bound by the terms of the Escrow Agreement executed by
Underwriter and the Issuer and acknowledge that you have received a copy of such
Escrow Agreement.
Until the First Closing Date, checks shall be made payable to "M&T
Bank, as Escrow Agent for Intervest Bancshares Corporation". After the First
Closing Date, checks shall be made payable to "Intervest Bancshares
Corporation", the Issuer. Until the First Closing Date, any checks received by
the Escrow Agent which are made payable to any party other than the Escrow
Agent, shall be returned by the Escrow Agent to the purchaser who submitted the
check and shall not be accepted.
All Units shall be registered and issued as designated by Dealer after
the Closing Dates specified in the Prospectus.
The Issuer reserves the right to reject any subscription, and in such
case, the Issuer will instruct the Escrow Agent or Underwriter, as may be the
case, to return, in full, any payment made in connection therewith.
If at least $4,200,000 in collected funds (as defined in the Escrow
Agreement) have not been received and such subscriptions accepted by the Issuer
by ___________, 1997, subscription documents and funds shall be promptly
returned to subscribers. Interest earned on funds in the Escrow Account shall be
applied to pay escrow expenses, with the balance of interest, if any, to be paid
to subscribers in proportion to the amount of funds paid by each such subscriber
without regard to the date when such subscription funds were paid. It shall be a
condition of making any such refund to a subscriber, however, that there be
delivered to the Escrow Agent a Form W-9 executed by such subscriber.
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7. Delivery of Prospectus. You shall solicit subscriptions for the
Units only in accordance with the then current Prospectus, shall deliver a
current Prospectus to each prospective investor, shall utilize as solicitation
material only the Prospectus and such supplemental sales literature as shall be
identified as such and furnished or authorized in writing by the Issuer, and
shall make no representations other than those contained in such Prospectus and
supplemental literature. You shall also be responsible for the servicing of
investors, including responding to inquiries by, and maintaining periodic
contacts with, the investor.
8. Restrictions on Sales and Purchases of Units. During the term of
this Agreement, you will not, directly or indirectly, buy, sell, or induce
others to buy or sell, the Units except (a) pursuant to this Agreement, (b) as
expressly authorized by the Underwriter in writing, or (c) in the ordinary
course of business as broker or agent for a customer pursuant to an unsolicited
order. You represent that you have not participated in any transaction
prohibited by the preceding sentence and that you have at all times complied
with the provisions of Regulation M of the 1934 Act applicable to this offering.
You will take such steps as you deem necessary to assure that purchasers of the
Units meet the suitability standards set forth in the Prospectus or otherwise
imposed by the Issuer and will maintain for a period of at least four (4) years
a record of the information obtained to indicate that such standards have been
met.
9. Commissions; Warrants. (a) You will be entitled to receive
commissions in the amount of 7% on each Unit sold by you under this Agreement,
provided, however, that the offering will be terminated and no commissions will
be payable unless an aggregate of at least $4,200,000 of the Units are sold by
_____________, 1997. (b) In the event that an aggregate of at last $4,200,000 of
the Units are sold by , you will also be entitled to receive Warrants to
purchase shares of the Class A Common Stock of the Company, such Warrants to be
for the purchase of one share of Class A Common Stock for each ten (10) units
sold by you under this Agreement. The Warrants issued hereunder shall be on the
same terms as those included in the Units (except as may otherwise be required
by applicable law, regulations or directives) and Dealer represents that it will
not, for a period of twelve (12) months from the effective date of the
Registration Statement, sell or transfer any of the Warrants or underlying
securities, except to its officers, directors or employees. The Warrants will be
issued after the final closing contemplated hereunder.
10. Dealer Responsibility for Training and Representatives. You
undertake full responsibility for adequate training of your salesmen in all
features of the Units offered, with special emphasis on the responsibilities of
such salesmen for full disclosure to prospective investors and the necessity of
delivering a Prospectus to each investor. You will accept subscriptions only
from persons whose investment objectives, to the best of your knowledge and
belief, are consistent with those of the Units offered.
11. Sales in Discretionary Accounts. You agree that, without the
written approval of the customer and the Underwriter prior to the execution of
any order, you will not sell to any account over which you exercise
discretionary authority any of the Units which you have been allotted and which
are subject to the terms of this Agreement.
12. Advertisements. It is expected that public advertisement of this
issue will be made on or about the effective date of the Registration Statement.
After the date of appearance of such advertisement, but not before, you are free
to advertise over your own name and at your own expense and risk, subject,
however, to our prior review and approval of any advertisement.
13. Termination of Agreement. This Agreement may be terminated by
either party at any time by written or telegraphic notice to the other, but the
Agreement shall not be valid for more than six (6) months from the date of
execution or beyond completion of the offering, whichever is earlier, except
when extended by the Underwriter to complete the offering of the Units. Such
termination shall not affect your obligation to comply with this Agreement nor
your right to commissions, as set forth in Paragraph 9 of this Agreement on
subscriptions confirmed by the Issuer by the time of such termination.
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14. Relationship of Parties. Nothing in this Agreement shall be
construed to constitute Dealer a partner, employee or agent of the Underwriter
or Issuer, and neither Underwriter, Issuer or Dealer shall be liable for any
obligation, act or omission of the other to third parties. However, in the event
such a claim is made, you agree to bear your share of any liability arising out
of such claim.
15. Dealer Expenses. All expenses incurred by Dealer in connection with
its activities under this Agreement shall be borne by Dealer, except that
Underwriter will furnish, without charge, a reasonable quantity of Prospectuses
and supplemental literature as issued.
16. Miscellaneous. This Agreement supersedes all previous agreements,
whether oral or written, between Underwriter and Dealer relating to the Units
and may not be modified except in writing. All previous agreements, if any,
whether oral or written, between Underwriter and dealer are hereby canceled.
Neither party hereto assumes any liability or obligation toward the other under
this or any previous agreement, except as may be specifically set forth in this
Agreement, nor is any such liability or obligation to be inferred or implied
hereunder.
All communications from you shall be addressed to the Underwriter at
the address set forth above. All communications from the Underwriter to you
shall be directed to the address to which this letter is mailed.
This Agreement shall be construed in accordance with the laws of the
State of New York.
Please confirm that the foregoing sets forth the Agreement between you
and the Underwriter by signing and returning to us the enclosed copy of this
letter.
Very truly yours,
SAGE, XXXXX & CO., INC.
By: __________________________________
---------------------------------------
(Title)
WE HEREBY CONFIRM AS OF THE DATE HEREOF
THAT THE ABOVE LETTER SETS FORTH THE
AGREEMENT BETWEEN THE UNDERWRITER AND
THE UNDERSIGNED
AMOUNT OF UNITS TO BE
OFFERED FOR SALE BY DEALER
-------------------------------------
(Dealer)
------------------------------------
By: ______________________________
-------------------------------------
(Title)
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