Exhibit 1(a)
------------
ATLAS AMERICA PUBLIC #12-2003 PROGRAM
DEALER-MANAGER AGREEMENT
WITH
ANTHEM SECURITIES, INC.
ANTHEM SECURITIES, INC.
DEALER-MANAGER AGREEMENT
TABLE OF CONTENTS
Page
1. Description of Units............................................................................................. 1
2. Representations, Warranties and Agreements of the Managing General Partner....................................... 1
3. Grant of Authority to the Dealer-Manager......................................................................... 2
4. Compensation and Fees............................................................................................ 2
5. Covenants of the Managing General Partner........................................................................ 4
6. Representations and Warranties of the Dealer-Manager............................................................. 4
7. State Securities Registration.................................................................................... 8
8. Expense of Sale.................................................................................................. 9
9. Conditions of the Dealer-Manager's Duties........................................................................ 9
10. Conditions of the Managing General Partner's Duties.............................................................. 10
11. Indemnification.................................................................................................. 10
12. Representations and Agreements to Survive Delivery............................................................... 11
13. Termination...................................................................................................... 11
14. Notices.......................................................................................................... 11
15. Format of Checks/Escrow Agent.................................................................................... 12
16. Transmittal Procedures........................................................................................... 12
17. Parties.......................................................................................................... 13
18. Relationship..................................................................................................... 13
19. Effective Date................................................................................................... 13
20. Entire Agreement, Waiver......................................................................................... 13
21. Complaints....................................................................................................... 13
22. Privacy.......................................................................................................... 13
Exhibit A - Form of Escrow Agreement for Atlas America Public #12-2003 Program
Exhibit B - Selling Agent Agreement
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ANTHEM SECURITIES, INC.
DEALER-MANAGER AGREEMENT
(Best Efforts)
RE: ATLAS AMERICA PUBLIC #12-2003 PROGRAM
Anthem Securities, Inc.
P.O. Box 926
Coraopolis, Pennsylvania 15108-0926
Gentlemen:
The undersigned, Atlas Resources, Inc., which is referred to as the
"Managing General Partner," on behalf of Atlas America Public #12-2003 Program,
which is referred to as the "Program," is a series of up to three limited
partnerships to be organized under the laws of Delaware as described below.
These limited partnerships are sometimes referred to in this Agreement in the
singular as a "Partnership" or in the plural as "Partnerships." The Managing
General Partner on behalf of the Partnerships hereby confirms its agreement with
you, as Dealer-Manager, as follows:
1. Description of Program and Units.
(a) The Managing General Partner, a Pennsylvania corporation,
proposes to be the sole managing general partner of the up to
three limited partnerships to be formed under the Delaware
Revised Uniform Limited Partnership Act. The Partnerships will be
named as follows:
(i) Atlas America Public #12-2003;
(ii) Atlas America Public #12-2004(A); and
(iii) Atlas America Public #12-2004(B).
On behalf of the Program and the Partnerships, a Registration
Statement on Form S-1 (Registration No. _______________) dated
May ___, 2003, relating to the offer and sale of the preformation
limited partner and investor general partner interests in the
Partnerships which are referred to as the "Units" was filed with
the Securities and Exchange Commission (the "Commission") under
the Securities Act of 1933, which is referred to as the "Act."
The Registration Statement was declared effective by the
Commission on ______________, 2003. The Partnerships and the
Units are described in the Prospectus dated __________________,
2003 (the "Prospectus") that forms a part of the Registration
Statement. As used in this Agreement, the terms "Prospectus" and
"Registration Statement" refer solely to the Prospectus and
Registration Statement, as amended, described above, except that:
(i) from and after the date on which any post-effective
amendment to the Registration Statement is declared
effective by the Commission, the term "Registration
Statement" shall refer to the Registration Statement as
amended by that post-
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effective amendment, and the term "Prospectus" shall
refer to the Prospectus then forming a part of the
Registration Statement; and
(ii) if the Prospectus filed by the Managing General Partner
pursuant to Rule 424(b) or (c) promulgated by the
Commission under the Act differs from the Prospectus on
file with the Commission at the time the Registration
Statement or any post-effective amendment thereto shall
have become effective, the term "Prospectus" shall refer
to the Prospectus filed pursuant thereto from and after
the date on which it was filed.
Terms defined in the Prospectus and not otherwise defined herein
will have the meanings set forth in the Prospectus.
(b) The Units will be sold at a price of $10,000 per Unit subject
to the discounts set forth in Section 4(c) of this Agreement
for certain investors. Subject to the receipt and acceptance by
the Managing General Partner of the minimum subscription
proceeds of $1,000,000, in a Partnership by its Offering
Termination Date for each Partnership as described in the
Prospectus (the "Offering Termination Date") the Managing
General Partner may break escrow and use the subscription
proceeds for the Partnership's drilling activities, which is
referred to as the "Initial Closing Date." The subscription
period for each Partnership will be as described in the
Prospectus. However, no offering of partnerships designated
"Atlas America Public #12-2003 Limited Partnership" or "Atlas
America Public #12-2004(___) Limited Partnership" may extend
beyond December 31, 2003 or 2004 respectively. Also, the
maximum subscriptions of all Partnerships must not exceed the
registered amount of $75 million.
The Managing General Partner will notify you and the Selling Agents as
defined below, of the Initial Closing Date and Offering Termination Date
for each Partnership.
2. Representations, Warranties and Agreements of the Managing General
Partner. The Managing General Partner represents and warrants to and
agrees with you that:
(a) The Partnerships composing the Program have a currently effective
Registration Statement on Form S-1, including a final Prospectus,
for the registration of the Units under the Act as described in
1. above.
(b) The Managing General Partner shall provide to you for delivery to
all offerees and purchasers and their representatives the
information and documents that the Managing General Partner deems
appropriate to comply with the Act and applicable state
securities acts, which are referred to as the "Blue Sky" laws.
(c) The Units when issued will be duly authorized and validly
issued as set forth in the Agreement of Limited Partnership of
each Partnership, which is referred to as the "Partnership
Agreement," the form of which is included as Exhibit (A) to the
Prospectus, and subject only to the rights and obligations set
forth in the Partnership Agreement or imposed by the laws of
the state of formation of each Partnership or of any
jurisdiction to the laws of which each Partnership is subject.
(d) Each Partnership will be duly formed under the laws of the State
of Delaware and once formed will be validly existing as a limited
partnership in good standing under the laws of Delaware with
full power and authority to own its properties and conduct its
business as described in the Prospectus.
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Each Partnership will be qualified to do business as a limited
partnership or similar entity offering limited liability in those
jurisdictions where the Managing General Partner deems the
qualification necessary to assure limited liability of the
limited partners.
(e) The Prospectus, as supplemented or amended, does not contain an
untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements in the Prospectus,
in the light of the circumstances under which they are made, not
misleading.
3. Grant of Authority to the Dealer-Manager.
(a) Based on the representations and warranties contained in this
Agreement, and subject to the terms and conditions set forth in
this Agreement, the Managing General Partner appoints you as the
Dealer-Manager for the Partnerships and gives you the exclusive
right to solicit subscriptions for the Units on a "best efforts"
basis in all states other than:
(i) Minnesota; and
(ii) New Hampshire
during the offering period as described in the Prospectus.
(b) In all states other than Minnesota and New Hampshire you agree
to use your best efforts to effect sales of the Units and to
form and manage a selling group composed of soliciting broker/
dealers, which are referred to as the "Selling Agents," each of
which shall be a member of the National Association of
Securities Dealers, Inc., which is referred to as the "NASD,"
and shall enter into a "Selling Agent Agreement" in
substantially the form attached to this Agreement as Exhibit
"B."
The Managing General Partner shall have three business days after the
receipt of an executed Selling Agent Agreement to refuse that Selling
Agent's participation.
4. Compensation and Fees.
(a) As Dealer-Manager you shall receive from the Managing General
Partner the following compensation, based on each Unit sold to
investors in a Partnership who are situated and/or residents in
states other than Minnesota and New Hampshire and whose
subscriptions for Units are accepted by the Managing General
Partner:
(i) a 2.5% Dealer-Manager fee;
(ii) a 7% Sales Commission;
(iii) a .5% accountable marketing expense fee; and
(iv) a .5% reimbursement of the Selling Agents' bona fide
accountable due diligence expenses.
(b) All of the Sales Commissions and the .5% reimbursement of the
Selling Agents' bonafide accountable due diligence expenses
shall be reallowed to the Selling Agents, and all or a portion
of the .5% accountable marketing expense fee may be reallowed
to the Selling Agents. The 2.5% Dealer-Manager fee shall be
reallowed to the wholesalers for
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subscriptions obtained through their efforts. You shall retain
any of the .5% accountable marketing expense fee not reallowed
to the Selling Agents.
(c) Notwithstanding the foregoing:
(i) the Managing General Partner, its officers, directors,
and affiliates, and investors who buy Units through the
officers and directors of the Managing General Partner
may subscribe to Units for a subscription price reduced
by the 2.5% Dealer-Manager fee, the 7% Sales Commission,
the .5% accountable marketing expense fee, and the .5%
reimbursement of the Selling Agents' bona fide
accountable due diligence expenses which shall not be
paid to you; and
(ii) registered investment advisors and their clients and
Selling Agents and their registered representatives and
principals may subscribe to Units for a subscription
price reduced by the 7% Sales Commission, which shall
not be paid to you, although their subscription price
shall not be reduced by the 2.5% Dealer-Manager fee, the
.5% accountable marketing expense fee, and the .5%
reimbursement of the Selling Agents' bona fide
accountable due diligence expenses which shall be paid
to you.
No more than 5% of the total Units sold in the Partnerships shall
be sold, in the aggregate, with the discounts described above.
(d) Pending receipt and acceptance by the Managing General Partner of
the minimum subscription proceeds of $1,000,000 in each
Partnership, excluding:
(i) any optional subscription of the Managing General Partner
and its Affiliates; and
(ii) the subscription discounts set forth in Section 4(c) of
this Agreement;
all proceeds received by you from the sale of Units in each
Partnership shall be held in a separate interest bearing escrow
account as provided in Section 15 of this Agreement.
Unless at least the minimum subscription proceeds of $1,000,000
as described above are received on or before the Offering
Termination Date of a Partnership as described in Section 1 of
this Agreement, the offering of Units in that Partnership shall
be terminated, in which event:
(i) the 2.5% Dealer-Manager fee, the 7% Sales Commission, the
.5% accountable marketing expense fee, and the .5%
reimbursement of the Selling Agents' bona fide
accountable due diligence expenses set forth in Section
4(a) of this Agreement shall not be payable to you;
(ii) all funds advanced by subscribers shall be returned to
them with interest earned; and
(iii) you shall deliver a termination letter in the form
provided to you by the Managing General Partner to each
of the subscribers and to each of the offerees previously
solicited by you and the Selling Agents in connection
with the offering of the Units.
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(e) Except as otherwise provided below, the fees, reimbursements, and
Sales Commissions set forth in Section 4(a) of this Agreement
shall be paid to you within five business days after the
following:
(i) at least the minimum subscription proceeds of $1,000,000
as described above have been received by the respective
Partnership and accepted by the Managing General Partner;
and
(ii) the Partnership's subscription proceeds have been
released from the escrow account to the Managing General
Partner.
You shall reallow to the Selling Agents and the wholesalers their
respective fees, reimbursements, and Sales Commissions as set
forth in Section 4(b) of this Agreement.
Thereafter, your fees, reimbursements, and Sales Commissions
shall be paid to you and shall be reallowed to the Selling Agents
and wholesalers as described above approximately every two weeks
until the Offering Termination Date for the respective
Partnership. All your remaining fees, reimbursements, and Sales
Commissions shall be paid by the Managing General Partner no
later than fourteen business days after the Offering Termination
Date for the respective Partnership.
5. Covenants of the Managing General Partner. The Managing General Partner
covenants and agrees that:
(a) The Managing General Partner shall deliver to you ample copies of
the Prospectus and all amendments or supplements to the
Prospectus.
(b) If any event affecting a Partnership or the Managing General
Partner occurs that in the opinion of the Managing General
Partner should be set forth in a supplement or amendment to the
Prospectus, then the Managing General Partner shall promptly at
its expense prepare and furnish to you a sufficient number of
copies of a supplement or amendment to the Prospectus so that
it, as so supplemented or amended, will not contain an untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements in the Prospectus, in
the light of the circumstances under which they are made, not
misleading.
6. Representations and Warranties of the Dealer-Manager. You, as the
Dealer-Manager, represent and warrant to the Managing General Partner
that:
(a) You are a corporation duly organized, validly existing and in
good standing under the laws of the state of your formation or of
any jurisdiction to the laws of which you are subject, with all
requisite power and authority to enter into this Agreement and to
carry out your obligations under this Agreement.
(b) This Agreement when accepted and approved shall be duly
authorized, executed, and delivered by you and shall be a valid
and binding agreement on your part in accordance with its terms.
(c) The consummation of the transactions contemplated by this
Agreement and the Prospectus shall not result in the following:
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(i) any breach of any of the terms or conditions of, or a
default under your Articles of Incorporation or Bylaws,
or any other indenture, agreement, or other instrument to
which you are a party; or
(ii) any violation of any order applicable to you of any court
or any federal or state regulatory body or administrative
agency having jurisdiction over you or your affiliates.
(d) You are duly registered under the provisions of the Securities
Exchange Act of 1934, which is referred to as the "Act of
1934," as a dealer, and you are a member in good standing of
the NASD. You are duly registered as a broker/dealer in the
states where you are required to be registered in order to
carry out your obligations as contemplated by this Agreement
and the Prospectus. You agree to maintain all the foregoing
registrations in good standing throughout the term of the offer
and sale of the Units in each Partnership, and you agree to
comply with all statutes and other requirements applicable to
you as a broker/dealer under those registrations.
(e) Pursuant to your appointment as Dealer-Manager, you shall use
your best efforts to exercise the supervision and control that
you deem necessary and appropriate to the activities of you and
the Selling Agents to comply with all the provisions of the
Act, insofar as the Act applies to your and their activities
under this Agreement. Further, you and the Selling Agents shall
not engage in any activity which would cause the offer and/or
sale of the Units not to comply with the Act, the Act of 1934,
the applicable rules and regulations of the Commission, the
applicable state securities laws and regulations, this
Agreement, and the NASD Conduct Rules including Rules 2420,
2730, 2740, 2750, and Rule 2810(b)(2) and (b)(3), which provide
as follows:
Sec. (b)(2)
Suitability
(A) A member or person associated with a member shall not
underwrite or participate in a public offering of a
direct participation program unless standards of
suitability have been established by the program for
participants therein and such standards are fully
disclosed in the prospectus and are consistent with the
provisions of subparagraph (B) of this section.
(B) In recommending to a participant the purchase, sale or
exchange of an interest in a direct participation
program, a member or person associated with a member
shall:
(i) have reasonable grounds to believe, on the basis
of information obtained from the participant
concerning his investment objectives, other
investments, financial situation and needs, and
any other information known by the member or
associated person, that:
(a) the participant is or will be in a
financial position appropriate to enable
him to realize to a significant extent the
benefits described in the
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prospectus, including the tax benefits
where they are a significant aspect of
the program;
(b) the participant has a fair market net
worth sufficient to sustain the risks
inherent in the program, including loss of
investment and lack of liquidity; and
(c) the program is otherwise suitable for the
participant; and
(ii) maintain in the files of the member documents
disclosing the basis upon which the determination
of suitability was reached as to each
participant.
(C) Notwithstanding the provisions of subparagraphs (A) and
(B) hereof, no member shall execute any transaction in a
direct participation program in a discretionary account
without prior written approval of the transaction by the
customer.
Sec. (b)(3)
Disclosure
(A) Prior to participating in a public offering of a direct
participation program, a member or person associated
with a member shall have reasonable grounds to believe,
based on information made available to him by the
sponsor through a prospectus or other materials, that
all material facts are adequately and accurately
disclosed and provide a basis for evaluating the
program.
(B) In determining the adequacy of disclosed facts pursuant
to subparagraph (A) hereof, a member or person associated
with a member shall obtain information on material facts
relating at a minimum to the following, if relevant in
view of the nature of the program:
(i) items of compensation;
(ii) physical properties;
(iii) tax aspects;
(iv) financial stability and experience of the sponsor;
(v) the program's conflicts and risk factors; and
(vi) appraisals and other pertinent reports.
(C) For purposes of subparagraphs (A) and (B) hereof, a
member or person associated with a member may rely upon
the results of an inquiry conducted by another member or
members, provided that:
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(i) the member or person associated with a member has
reasonable grounds to believe that such inquiry
was conducted with due care;
(ii) the results of the inquiry were provided to the
member or person associated with a member with
the consent of the member or members conducting
or directing the inquiry; and
(iii) no member that participated in the inquiry is a
sponsor of the program or an affiliate of such
sponsor.
(D) Prior to executing a purchase transaction in a direct
participation program, a member or person associated with
a member shall inform the prospective participant of all
pertinent facts relating to the liquidity and
marketability of the program during the term of
investment.
(f) You agree to advise the Managing General Partner in writing of
each state in which you and the Selling Agents propose to offer
or sell the Units; and you shall not nor shall you permit any
Selling Agent to offer or sell the Units in any state until you
have been advised in writing by the Managing General Partner, or
the Managing General Partner's special counsel, that the offer or
sale of the Units:
(i) has been qualified in the state;
(ii) is exempt from the qualification requirements imposed by
the state; or
(iii) the qualification is otherwise not required.
(g) You and the Selling Agents have received copies of the Prospectus
relating to the Units and you and the Selling Agents have relied
only on the statements contained in the Prospectus and not on any
other statements whatsoever, either written or oral, with respect
to the details of the offering of Units.
You agree and shall require any Selling Agent to agree to deliver
a copy of the Prospectus to each subscriber to whom you sell the
Units at or before the completion of any sale of Units to such
subscriber (which sale shall be deemed, for the purposes of this
Agreement to occur on the date on which that subscriber delivers
subscription funds to the escrow agent), or earlier if required
by the blue sky or securities laws of any state. Unless advised
otherwise by the Managing General Partner, you and the Selling
Agents may choose to provide each offeree with the following,
which are collectively referred to as the "Sales Literature":
(i) a flyer entitled "Atlas America Public #12-2003 Program";
(ii) an article entitled "Tax Rewards with Oil and Gas
Partnerships";
(iii) a brochure of tax scenarios entitled "How an Investment
in Atlas America Public #12-2003 Program can Help Achieve
an Investor's Tax Objectives";
(iv) a brochure entitled "Investing in Atlas America Public
#12-2003 Program";
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(v) a booklet entitled "Outline of Tax Consequences of Oil
and Gas Drilling Programs"; and
(vi) possibly other supplementary materials.
Any such Sales Literature, if distributed, must have been
preceded or must be accompanied by the Prospectus.
(h) You and the Selling Agents agree that you and the Selling Agents
shall not place any advertisement or other solicitation with
respect to the Units (including without limitation any material
for use in any newspaper, magazine, radio or television
commercial, telephone recording, motion picture, or other public
media) without:
(i) the prior written approval of the Managing General
Partner; and
(ii) the prior written approval of the form and content
thereof by the Commission, the NASD and the securities
authorities of the states where such advertisement or
solicitation is to be circulated.
Any such advertisements or solicitations shall be at your
expense.
(i) If a supplement or amendment to the Prospectus is prepared and
delivered to you by the Managing General Partner, you agree and
shall require any Selling Agent to agree as follows:
(i) to distribute each supplement or amendment to the
Prospectus to every person who has previously received a
copy of the Prospectus from you and/or the Selling Agent;
and
(ii) to include each supplement or amendment in all future
deliveries of any Prospectus.
(j) In connection with any offer or sale of the Units, you agree and
shall require any Selling Agent to agree to the following:
(i) to comply in all respects with statements set forth in
the Prospectus, the Partnership Agreement, and any
supplements or amendments to the Prospectus;
(ii) not to make any statement inconsistent with the
statements in the Prospectus, the Partnership Agreement,
and any supplements or amendments to the Prospectus;
(iii) not to make any untrue or misleading statements of a
material fact in connection with the Units; and
(iv) not to provide any written information, statements, or
sales materials other than the Prospectus, the Sales
Literature, and any supplements or amendments to the
Prospectus unless approved in writing by the Managing
General Partner.
(k) You agree to use your best efforts in the solicitation and sale
of the Units and to coordinate and supervise the efforts of the
Selling Agents, and you shall require any
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Selling Agent to agree to use its best efforts in the
solicitation and sale of the Units, including that:
(i) the prospective purchasers meet the suitability
requirements set forth in the Prospectus, the
Subscription Agreement, and this Agreement; and
(ii) the prospective purchasers properly complete and execute
the Subscription Agreement, which has been provided as
Exhibit (I-B) to the Partnership Agreement, Exhibit (A)
of the Prospectus, together with any additional forms
provided in any supplement or amendment to the
Prospectus, or otherwise provided to you by the Managing
General Partner to be completed by prospective
purchasers.
The Managing General Partner shall have the right to reject any
subscription at any time for any reason without liability to it.
Subscription funds and executed Subscription Agreements shall be
transmitted as set forth in Section 16 of this Agreement.
(l) Although not anticipated, if you assist in any transfers of the
Units, then you shall comply, and you shall require any Selling
Agent to comply, with the requirements of Rule 2810(b)(2)(B) and
(b)(3)(D) of the NASD Conduct Rules.
(m) You agree and covenant that:
(i) the representations and warranties you make in this
Agreement are and shall be true and correct at the
applicable closing date; and
(ii) you shall have fulfilled all your obligations under this
Agreement at the applicable closing date.
7. State Securities Registration. Incident to the offer and sale of the
Units, the Managing General Partner shall use its best efforts either in
taking:
(a) all necessary action and filing all necessary forms and documents
deemed reasonable by it in order to qualify or register Units for
sale under the securities laws of the states requested by you
pursuant to Section 6(f) of this Agreement; or
(b) any necessary action and filing any necessary forms deemed
reasonable by it in order to obtain an exemption from
qualification or registration in those states.
Notwithstanding, the Managing General Partner may elect not to qualify
or register Units in any state or jurisdiction in which it deems the
qualification or registration is not warranted for any reason in its
sole discretion. The Managing General Partner and its counsel shall
inform you as to the states and jurisdictions in which the Units have
been qualified for sale or are exempt under the respective securities or
Blue Sky laws of those states and jurisdictions. The Managing General
Partner, however, has not assumed and will not assume any obligation or
responsibility as to your right or any Selling Agent's right to act as a
broker/dealer with respect to the Units in any state or jurisdiction.
The Managing General Partner shall provide to you and the Selling Agents
for delivery to all offerees and purchasers and their representatives
any additional information, documents, and instruments that the Managing
General Partner deems necessary to comply with the rules,
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regulations, and judicial and administrative interpretations in those
states and jurisdictions for the offer and sale of the Units in these
states.
The Managing General Partner shall file all post-offering forms,
documents, or materials and take all other actions required by the
states and jurisdictions in which the offer and sale of Units have been
qualified, registered, or are exempt. However, the Managing General
Partner shall not be required to take any action, make any filing, or
prepare any document necessary or required in connection with your
status or any Selling Agent's status as a broker/dealer under the laws
of any state or jurisdiction.
The Managing General Partner shall provide you with copies of all
applications, filings, correspondence, orders, other documents, or
instruments relating to any application for qualification, registration,
exemption, or other approval under applicable state or Federal
securities laws for the offering.
8. Expense of Sale. The expenses in connection with the offer and sale of
the Units shall be payable as set forth below.
(a) The Managing General Partner shall pay all expenses incident to
the performance of its obligations under this Agreement,
including the fees and expenses of its attorneys and
accountants and all fees and expenses of registering or
qualifying the Units for offer and sale in the states and
jurisdictions as set forth in Section 7 of this Agreement, or
obtaining exemptions from qualification or registration, even
if the offering of the Partnerships is not successfully
completed.
(b) You shall pay all expenses incident to the performance of your
obligations under this Agreement, including the formation and
management of the selling group and the fees and expenses of your
own counsel and accountants, even if the offering of the
Partnerships is not successfully completed.
9. Conditions of the Dealer-Manager's Duties. Your obligations under this
Agreement shall be subject to the accuracy, as of the date of this
Agreement and at the applicable closing date of:
(a) the Managing General Partner's representations and warranties
made in this Agreement; and
(b) to the performance by the Managing General Partner of its
obligations under this Agreement.
10. Conditions of the Managing General Partner's Duties. The Managing
General Partner's obligations provided under this Agreement, including
the duty to pay compensation to you as set forth in Section 4 of this
Agreement, shall be subject to the following:
(a) the accuracy, as of the date of this Agreement and at the
applicable closing date of each Partnership as if made at the
applicable closing date, of your representations and warranties
made in this Agreement;
(b) the performance by you of your obligations under this Agreement;
and
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(c) the Managing General Partner's receipt, at or before the
applicable closing date of each Partnership, of a fully executed
Subscription Agreement for each prospective purchaser as required
by Section 6(k) of this Agreement.
11. Indemnification.
(a) You and the Selling Agents shall indemnify and hold harmless
the Managing General Partner, each Partnership and its
attorneys against any losses, claims, damages or liabilities,
joint or several, to which they may become subject under the
Act, the Act of 1934, or otherwise insofar as the losses,
claims, damages, or liabilities (or actions in respect thereof)
arise out of or are based on your agreements with the Selling
Agents or your breach of any of your duties and obligations,
representations, or warranties under the terms or provisions of
this Agreement, and you and the Selling Agents shall reimburse
them for any legal or other expenses reasonably incurred in
connection with investigating or defending the losses, claims,
damages, liabilities, or actions.
(b) The Managing General Partner shall indemnify and hold you and
the Selling Agents harmless against any losses, claims, damages
or liabilities, joint or several, to which you and the Selling
Agents may become subject under the Act, the Act of 1934, or
otherwise insofar as the losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or are
based on the Managing General Partner's breach of any of its
duties and obligations, representations, or warranties under
the terms or provisions of this Agreement, and the Managing
General Partner shall reimburse you and the Selling Agents for
any legal or other expenses reasonably incurred in connection
with investigating or defending the losses, claims, damages,
liabilities, or actions.
(c) The foregoing indemnity agreements shall extend on the same terms
and conditions to, and shall inure to the benefit of, each
person, if any, who controls each indemnified party within the
meaning of the Act.
(d) Promptly after receipt by an indemnified party of notice of the
commencement of any action, the indemnified party shall, if a
claim in respect of the action is to be made against an
indemnifying party under this Section, notify the indemnifying
party in writing of the commencement of the action; but the
omission to promptly notify the indemnifying party shall not
relieve the indemnifying party from any liability which it may
have to any indemnified party. If any action is brought against
an indemnified party, it shall notify the indemnifying party of
the commencement of the action, and the indemnifying party shall
be entitled to participate in, and, to the extent that it
wishes, jointly with any other indemnifying party similarly
notified, to assume the defense of the action, with counsel
satisfactory to the indemnified and indemnifying parties. After
the indemnified party has received notice from the agreed on
counsel that the defense of the action under this paragraph has
been assumed, the indemnifying party shall not be responsible
for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense of the
action other than with respect to the agreed on counsel who
assumed the defense of the action.
12. Representations and Agreements to Survive Delivery. All representations,
warranties, and agreements of the Managing General Partner and you in
this Agreement, including the indemnity agreements contained in Section
11 of this Agreement, shall:
(a) survive the delivery, execution and closing of this Agreement;
and
Anthem Securities, Inc.
Dealer-Manager Agreement
12
(b) remain operative and in full force and effect regardless of any
investigation made by or on behalf of you or any person who
controls you within the meaning of the Act, by the Managing
General Partner, or any of its officers, directors, or any person
who controls the Managing General Partner within the meaning of
the Act, or any other indemnified party; and
(c) survive delivery of the Units.
13. Termination.
(a) You shall have the right to terminate this Agreement other than
the indemnification provisions of Section 11 of this Agreement by
giving notice as specified below any time at or before a closing
date:
(i) if the Managing General Partner has failed, refused, or
been unable at or before a closing date, to perform any
of its obligations under this Agreement; or
(ii) there has occurred an event materially and adversely
affecting the value of the Units.
If you elect to terminate this Agreement other than the indemnification
provisions of Section 11 of this Agreement, then the Managing General
Partner shall be promptly notified by you by telephone, e-mail,
facsimile, or telegram, confirmed by letter.
(b) The Managing General Partner may terminate this Agreement other
than the indemnification provisions of Section 11 of this
Agreement, for any reason and at any time, by promptly giving
notice to you by telephone, e-mail, facsimile, or telegram,
confirmed by letter as specified below at or before a closing
date.
14. Notices.
(a) All notices or communications under this Agreement, except as
otherwise specifically provided, shall be in writing.
(b) Any notice or communication sent by the Managing General Partner
to you shall be mailed, delivered, or sent by facsimile, e-mail
or telegraph, and confirmed to you at P.O. Box 926, 311 Rouser
Road, Coraopolis, Pennsylvania 15108-0926.
(c) Any notice or communication sent by you to the Managing General
Partner or a Partnership shall be mailed, delivered, or sent by
facsimile, e-mail or telegraph, and confirmed at 311 Rouser Road,
Moon Township, Pennsylvania 15108.
15. Format of Checks/Escrow Agent. Pending receipt of the minimum
subscription proceeds of $1,000,000 of each Partnership as set forth in
Section 4(d) of this Agreement, the Managing General Partner and you and
the Selling Agents, including customer carrying broker/dealers, agree
that all subscribers shall be instructed to make their checks, drafts,
or money orders payable solely to the Escrow Agent for the Partnership
in which the Units are then being offered as follows:
(a) "Atlas Public #12-2003 Limited Partnership, Escrow Agent,
National City Bank"; or
Anthem Securities, Inc.
Dealer-Manager Agreement
13
(b) "Atlas Public #12-2004(___) Limited Partnership, Escrow Agent,
National City Bank"
as agent for the respective Partnership, and you agree and shall require
the Selling Agents, including customer carrying broker/dealers, to agree
to comply with Rule 15c2-4 adopted under the Act of 1934.
If you receive a check, draft, or money order not conforming to the
foregoing instructions, then you shall return the check, draft, or money
order to the Selling Agent not later than the end of the next business
day following its receipt by you. The Selling Agent shall then return
the check, draft, or money order directly to the subscriber not later
than the end of the next business day following its receipt from you.
Checks, drafts, or money orders received by you or a Selling Agent which
conform to the foregoing instructions shall be transmitted by you under
Section 16 "Transmittal Procedures," below.
You represent that you have or will execute the Escrow Agreement for
each Partnership and agree that you are bound by the terms of the Escrow
Agreement executed by you, for the respective Partnership, and the
Managing General Partner, forms of which are attached to this Agreement
as Exhibits "A-1" through "A-3."
16. Transmittal Procedures. You and each Selling Agent, including customer
carrying broker/dealers, shall transmit received investor funds in
accordance with the following procedures. For purposes of the following,
the term "Selling Agent" shall also include you as Dealer- Manager when
you receive subscriptions from investors.
(a) Pending receipt of a Partnership's minimum subscription
proceeds of $1,000,000 as set forth in Section 4(d) of this
Agreement, the Selling Agents on receipt of any check, draft,
and money order from a subscriber shall promptly transmit the
check, draft, and money order and the original executed
Subscription Agreement to you, as Dealer-Manager, by the end of
the next business day following receipt of the check, draft, or
money order by the Selling Agent. By the end of the next
business day following your receipt of the check, draft, or
money order and the original executed Subscription Agreement,
you, as Dealer-Manager, shall transmit the check, draft, or
money order and a copy of the executed Subscription Agreement to
the Escrow Agent, and the original executed Subscription
Agreement and a copy of the check, draft, or money order to the
Managing General Partner.
(b) On receipt by you, as Dealer-Manager, of notice from the
Managing General Partner that a Partnership's minimum
subscription proceeds of $1,000,000 as set forth in Section
4(d) of this Agreement have been received, the Managing General
Partner, you, and the Selling Agents agree that all subscribers
then may be instructed, in the Managing General Partner's sole
discretion, to make their checks, drafts, or money orders
payable solely to the Partnership in which Units are then being
offered.
Thereafter, the Selling Agents shall promptly transmit any and
all checks, drafts, and money orders received from subscribers
and the original executed Subscription Agreement to you, as
Dealer-Manager, by the end of the next business day following
receipt of the check, draft, or money order by the Selling Agent.
By the end of the next business day following your receipt of the
check, draft, or money order and the original executed
Subscription Agreement, you, as Dealer-Manager, shall transmit
the check, draft or money order and the original executed
Subscription Agreement to the Managing General Partner.
Anthem Securities, Inc.
Dealer-Manager Agreement
14
17. Parties. This Agreement shall inure to the benefit of and be binding on
you, the Managing General Partner, and any respective successors and
assigns. This Agreement shall also inure to the benefit of the
indemnified parties, their successors and assigns. This Agreement is
intended to be and is for the sole and exclusive benefit of the parties
to this Agreement, including the Partnerships, and their respective
successors and assigns, and the indemnified parties and their
successors and assigns, and for the benefit of no other person. No
other person shall have any legal or equitable right, remedy or claim
under or in respect of this Agreement. No purchaser of any of the Units
from you or a Selling Agent shall be construed a successor or assign
merely by reason of the purchase.
18. Relationship. This Agreement shall not constitute you a partner of the
Managing General Partner, a Partnership, or any general partner of a
Partnership, nor render the Managing General Partner, the Partnerships,
or any general partner of a Partnership liable for any of your
obligations.
19. Effective Date. This Agreement is made effective between the parties as
of the date accepted by you as indicated by your signature to this
Agreement.
20. Entire Agreement, Waiver.
(a) This Agreement constitutes the entire agreement between the
Managing General Partner and you, and shall not be amended or
modified in any way except by subsequent agreement executed in
writing. Neither party to this Agreement shall be liable or bound
to the other by any agreement except as specifically set forth in
this Agreement.
(b) The Managing General Partner and you may waive, but only in
writing, any term, condition, or requirement under this
Agreement that is intended for its benefit. However, any
written waiver of any term or condition of this Agreement shall
not operate as a waiver of any other breach of that term or
condition of this Agreement. Also, any failure to enforce any
provision of this Agreement shall not operate as a waiver of
that provision or any other provision of this Agreement.
21. Complaints. The Managing General Partner and you, as Dealer-Manager,
agree as follows:
(a) to notify the other if either receives an investor complaint in
connection with the offer or sale of Units by you or a Selling
Agent;
(b) to cooperate with the other in resolving the complaint; and
(c) to cooperate in any regulatory examination of the other to the
extent it involves this Agreement or the offer or sale of Units
by you or a Selling Agent.
22. Privacy. The Managing General Partner and you each acknowledge that
certain information made available to the other under this Agreement may
be deemed nonpublic personal information under the Gramm-Leach- Bliley
Act, other federal or state privacy laws (as amended), and the rules and
regulations promulgated thereunder, which are referred to collectively,
as the "Privacy Laws." The Managing General Partner and you agree as
follows:
(a) not to disclose or use the information except as required to
carry out each party's respective duties under this Agreement or
as otherwise permitted by law in the ordinary course of business;
Anthem Securities, Inc.
Dealer-Manager Agreement
15
(b) to establish and maintain procedures reasonably designated to
assure the security and privacy of all the information; and
(c) to cooperate with the other and provide reasonable assistance in
ensuring compliance with the Privacy Laws to the extent
applicable to either or both the Managing General Partner and
you.
23. Anti-Money Laundering Provision. You and each Selling Agent each
represent and warrant to the Managing General Partner that each of you
have in place and will maintain suitable and adequate "know your
customer" policies and procedures and that each of you shall comply with
all applicable laws and regulations regarding anti-money laundering
activity and will provide such documentation to the Managing General
Partner on written request.
Very truly yours,
MANAGING GENERAL PARTNER
ATLAS RESOURCES, INC.,
a Pennsylvania corporation
__________________________, 2003 By: _________________________________
Date
Jack L. Hollander, Senior Vice
President - Direct Participation
Programs
PROGRAM
ATLAS AMERICA PUBLIC #12-2003 PROGRAM
By: Atlas Resources, Inc.,
Managing General Partner
__________________________, 2003 By: _________________________________
Date Jack L. Hollander, Senior Vice
President - Direct Participation
Programs
DEALER-MANAGER
ANTHEM SECURITIES, INC.,
a Pennsylvania corporation
__________________________, 2003 By: _________________________________
Date Justin Atkinson, Vice President
Anthem Securities, Inc.
Dealer-Manager Agreement
16
EXHIBIT "A-1"
ATLAS AMERICA PUBLIC #12-2003 LIMITED PARTNERSHIP
ESCROW AGREEMENT
THIS AGREEMENT is made to be effective as of ________________, by and among
Atlas Resources, Inc., a Pennsylvania corporation (the "Managing General
Partner"), Anthem Securities, Inc., a Pennsylvania corporation ("Anthem"), Bryan
Funding, Inc., a Pennsylvania corporation ("Bryan Funding"), collectively Anthem
and Bryan Funding are referred to as the "Dealer-Manager," Atlas America Public
#12-2003 Limited Partnership, a Delaware limited partnership to be formed (the
"Partnership") and National City Bank of Pennsylvania, Pittsburgh, Pennsylvania,
as escrow agent (the "Escrow Agent").
WITNESSETH:
WHEREAS, the Managing General Partner intends to offer publicly for sale to
qualified investors (the "Investors") up to 7,500 limited and investor general
partner interests in the Partnership (the "Units").
WHEREAS, each Investor will be required to pay his subscription in full on
subscribing by check, draft, or money order (the "Subscription Proceeds").
WHEREAS, the cost per Unit will be $10,000 subject to certain discounts of
up to 10.5% ($1,050 per Unit) for sales to the Managing General Partner, its
officers, directors and affiliates, registered investment advisors and their
clients, Selling Agents and their registered representatives and principals, and
investors who buy Units through the officers and directors of the Managing
General Partner. Also, the Managing General Partner, in its discretion, may
accept one-half Unit ($5,000) subscriptions, with larger subscriptions permitted
in $1,000 increments.
WHEREAS, the Managing General Partner and Anthem have executed an agreement
("Anthem Dealer-Manager Agreement") under which Anthem will solicit
subscriptions for Units in all states other than Minnesota and New Hampshire on
a "best efforts" "all or none" basis for Subscription Proceeds of $1,000,000 and
on a "best efforts" basis for the remaining Units on behalf of the Managing
General Partner and the Partnership and under which Anthem has been authorized
to select certain members in good standing of the National Association of
Securities Dealers, Inc. ("NASD") to participate in the offering of the Units
("Selling Agents").
WHEREAS, the Managing General Partner and Bryan Funding have executed an
agreement ("Bryan Funding Dealer-Manager Agreement") under which Bryan Funding
will solicit subscriptions for Units in the states of Minnesota and New
Hampshire on a "best efforts" "all or none" basis for Subscription Proceeds of
$1,000,000 and on a "best efforts" basis for the remaining Units on behalf of
the Managing General Partner and the Partnership and under which Bryan Funding
has been authorized to select certain members in good standing of the NASD to
participate in the offering of the Units ("Selling Agents").
WHEREAS, the Anthem Dealer-Manager Agreement and the Bryan Funding Dealer-
Manager Agreement, collectively referred to as the "Dealer-Manager Agreement,"
provide for compensation to the Dealer-Manager to participate in the offering of
the Units, subject to the discounts set forth above for certain Investors, which
compensation includes, but is not limited to, for each Unit sold:
1
o a 2.5% Dealer-Manager fee;
o a 7% sales commission;
o a .5% accountable marketing expenses fee; and
o a .5% reimbursement of the Selling Agents' bona fide
accountable due diligence expenses;
all or a portion of which will be reallowed to the Selling Agents and
wholesalers.
WHEREAS, under the terms of the Dealer-Manager Agreement the Subscription
Proceeds are required to be held in escrow subject to the receipt and acceptance
by the Managing General Partner of the minimum Subscription Proceeds of
$1,000,000, excluding any optional subscription by the Managing General Partner,
its officers, directors, and Affiliates.
WHEREAS, the Units may also be offered and sold by the officers and
directors of the Managing General Partner without receiving a sales commission
or other compensation on their sales.
WHEREAS, no subscriptions to the Partnership will be accepted after the
"Offering Termination Date," which is the first to occur of either:
o receipt of the maximum Subscription Proceeds of $75,000,000; or
o December 31, 2003.
WHEREAS, to facilitate compliance with the terms of the Dealer-Manager
Agreement and Rule 15c2-4 adopted under the Securities Exchange Act of 1934, the
Managing General Partner and the Dealer-Manager desire to have the Subscription
Proceeds deposited with the Escrow Agent and the Escrow Agent agrees to hold the
Subscription Proceeds under the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained in this Agreement, the parties to this Agreement, intending to be
legally bound, agree as follows:
1. Appointment of Escrow Agent. The Managing General Partner, the
Partnership, and the Dealer-Manager appoint the Escrow Agent as the
escrow agent to receive and to hold the Subscription Proceeds deposited
with the Escrow Agent by the Dealer-Manager and the Managing General
Partner under this Agreement, and the Escrow Agent agrees to serve in
this capacity during the term and based on the provisions of this
Agreement.
2. Deposit of Subscription Proceeds. Pending receipt of the minimum
Subscription Proceeds of $1,000,000, the Dealer-Manager and the
Managing General Partner shall deposit the Subscription Proceeds of
each Investor to whom they sell Units with the Escrow Agent and shall
deliver to the Escrow Agent a copy of the Subscription Agreement of the
Investor. Payment for each subscription for Units shall be in the form
of a check made payable to "Atlas America Public #12-2003 Limited
Partnership, Escrow Agent, National City Bank of Pennsylvania." The
Escrow Agent shall deliver a receipt to either:
(a) Anthem and the Managing General Partner for each deposit of
Subscription Proceeds made under this Agreement by Anthem;
Escrow Agreement
2
(b) Bryan Funding and the Managing General Partner for each deposit
of Subscription Proceeds made under this Agreement by Bryan
Funding; or
(c) the Managing General Partner for each deposit of Subscription
Proceeds made under this Agreement by the Managing General
Partner.
3. Investment of Subscription Proceeds. The Subscription Proceeds shall be
deposited in an interest bearing account maintained by the Escrow
Agent. This may be a savings account, bank money market account, short-
term certificates of deposit issued by a bank, or short-term
certificates issued or guaranteed by the United States government. The
interest earned shall be added to the Subscription Proceeds and
disbursed in accordance with the provisions of Paragraph 4 or 5 of this
Agreement, as the case may be.
4. Distribution of Subscription Proceeds. If the Escrow Agent:
(a) receives written notice from an authorized officer of the
Managing General Partner that at least the minimum Subscription
Proceeds of $1,000,000 have been received and accepted by the
Managing General Partner; and
(b) determines that Subscription Proceeds for at least $1,000,000
have cleared the banking system and are good;
then the Escrow Agent shall promptly release and distribute to the
Managing General Partner the escrowed Subscription Proceeds which have
cleared the banking system and are good plus any interest paid and
investment income earned on the Subscription Proceeds while held by the
Escrow Agent in the escrow account.
Any remaining Subscription Proceeds, plus any interest paid and
investment income earned on the Subscription Proceeds while held by the
Escrow Agent in the escrow account, shall be promptly released and
distributed to the Managing General Partner by the Escrow Agent as the
Subscription Proceeds clear the banking system and become good.
5. Separate Partnership Account. During the continuation of the offering
after the Partnership is funded with cleared Subscription Proceeds of
at least $1,000,000 and the Escrow Agent receives the notice described
in Paragraph 4 of this Agreement, and before the Offering Termination
Date, any additional Subscription Proceeds may be deposited by the
Dealer-Manager and the Managing General Partner directly in a separate
Partnership account which shall not be subject to the terms of this
Agreement.
6. Distributions to Subscribers.
(a) If the Partnership is not funded as contemplated because less
than the minimum Subscription Proceeds of $1,000,000 have been
received and accepted by the Managing General Partner by twelve
p.m. (noon), local time, on the Offering Termination Date, or
for any other reason, then the Managing General Partner shall
notify the Escrow Agent, and the Escrow Agent promptly shall
distribute to each Investor a refund check made payable to the
Investor in an amount equal to the Subscription Proceeds of the
Investor, plus any interest paid or investment income earned on
the Investor's Subscription Proceeds while held by the Escrow
Agent in the escrow account.
Escrow Agreement
3
(b) If a subscription for Units submitted by an Investor is
rejected by the Managing General Partner for any reason after
the Subscription Proceeds relating to the subscription have
been deposited with the Escrow Agent, then the Managing General
Partner promptly shall notify the Escrow Agent of the
rejection, and the Escrow Agent shall promptly distribute to
the Investor a refund check made payable to the Investor in an
amount equal to the Subscription Proceeds of the Investor, plus
any interest paid or investment income earned on the Investor's
Subscription Proceeds while held by the Escrow Agent in the
escrow account.
7. Compensation and Expenses of Escrow Agent. The Managing General Partner
shall be solely responsible for and shall pay the compensation of the
Escrow Agent for its services under this Agreement, as provided in
Appendix 1 to this Agreement and made a part of this Agreement, and the
charges, expenses (including any reasonable attorneys' fees), and other
out-of-pocket expenses incurred by the Escrow Agent in connection with
the administration of the provisions of this Agreement. The Escrow
Agent shall have no lien on the Subscription Proceeds deposited in the
escrow account unless and until the Partnership is funded with cleared
Subscription Proceeds of at least $1,000,000 and the Escrow Agent
receives the notice described in Paragraph 4 of this Agreement, at
which time the Escrow Agent shall have, and is granted, a prior lien on
any property, cash, or assets held under this Agreement, with respect
to its unpaid compensation and nonreimbursed expenses, superior to the
interests of any other persons or entities.
8. Duties of Escrow Agent. The Escrow Agent shall not be obligated to
accept any notice, make any delivery, or take any other action under
this Agreement unless the notice or request or demand for delivery or
other action is in writing and given or made by the party given the
right or charged with the obligation under this Agreement to give the
notice or to make the request or demand. In no event shall the Escrow
Agent be obligated to accept any notice, request, or demand from anyone
other than the Managing General Partner or the Dealer-Manager.
9. Liability of Escrow Agent. The Escrow Agent shall not be liable for any
damages, or have any obligations other than the duties prescribed in
this Agreement in carrying out or executing the purposes and intent of
this Agreement. However, nothing in this Agreement shall relieve the
Escrow Agent from liability arising out of its own willful misconduct
or gross negligence. The Escrow Agent's duties and obligations under
this Agreement shall be entirely administrative and not discretionary.
The Escrow Agent shall not be liable to any party to this Agreement or
to any third-party as a result of any action or omission taken or made
by the Escrow Agent in good faith. The parties to this Agreement will
indemnify the Escrow Agent, hold the Escrow Agent harmless, and
reimburse the Escrow Agent from, against and for, any and all
liabilities, costs, fees and expenses (including reasonable attorney's
fees) the Escrow Agent may suffer or incur by reason of its execution
and performance of this Agreement. If any legal questions arise
concerning the Escrow Agent's duties and obligations under this
Agreement, then the Escrow Agent may consult with its counsel and rely
without liability on written opinions given to it by its counsel.
The Escrow Agent shall be protected in acting on any written notice,
request, waiver, consent, authorization, or other paper or document
which the Escrow Agent, in good faith, believes to be genuine and what
it purports to be.
If there is any disagreement between any of the parties to this
Agreement, or between them or any other person, resulting in adverse
claims or demands being made in connection with this Agreement, or if
the Escrow Agent, in good faith, is in doubt as to what action it should
take under this Agreement, then the Escrow Agent may, at its option,
refuse to comply with any claims or demands on it or refuse to take any
other action under this Agreement, so long as the disagreement
continues or the doubt exists. In any such event, the Escrow Agent
shall not be or become liable in any way or
Escrow Agreement
4
to any person for its failure or refusal to act and the Escrow Agent
shall be entitled to continue to so refrain from acting until the
dispute is resolved by the parties involved.
National City Bank of Pennsylvania is acting solely as the Escrow Agent
and is not a party to, nor has it reviewed or approved any agreement or
matter of background related to this Agreement, other than this
Agreement itself, and has assumed, without investigation, the authority
of the individuals executing this Agreement to be so authorized on
behalf of the party or parties involved.
10. Resignation or Removal of Escrow Agent. The Escrow Agent may resign as
such after giving thirty days' prior written notice to the other
parties to this Agreement. Similarly, the Escrow Agent may be removed
and replaced after giving thirty days' prior written notice to the
Escrow Agent by the other parties to this Agreement. In either event,
the duties of the Escrow Agent shall terminate thirty days after the
date of the notice (or as of an earlier date as may be mutually
agreeable); and the Escrow Agent shall then deliver the balance of the
Subscription Proceeds (and any interest paid or investment income
earned thereon while held by the Escrow Agent in the escrow account) in
its possession to a successor escrow agent appointed by the other
parties to this Agreement as evidenced by a written notice filed with
the Escrow Agent.
If the other parties to this Agreement are unable to agree on a
successor escrow agent or fail to appoint a successor escrow agent
before the expiration of thirty days following the date of the notice of
the Escrow Agent's resignation or removal, then the Escrow Agent may
petition any court of competent jurisdiction for the appointment of a
successor escrow agent or other appropriate relief. Any resulting
appointment shall be binding on all of the parties to this Agreement.
On acknowledgment by any successor escrow agent of the receipt of the
then remaining balance of the Subscription Proceeds (and any interest
paid or investment income earned thereon while held by the Escrow Agent
in the escrow account), the Escrow Agent shall be fully released and
relieved of all duties, responsibilities, and obligations under this
Agreement.
11. Termination. This Agreement shall terminate and the Escrow Agent shall
have no further obligation with respect to this Agreement after the
distribution of all Subscription Proceeds (and any interest paid or
investment income earned thereon while held by the Escrow Agent in the
escrow account) as contemplated by this Agreement or on the written
consent of all the parties to this Agreement.
12. Notice. Any notices or instructions, or both, to be given under this
Agreement shall be validly given if set forth in writing and mailed by
certified mail, return receipt requested, as follows:
If to the Escrow Agent:
National City Bank of Pennsylvania
One National City Center
Corporate Trust, Suite 655 S
Indianapolis, IN 46255
Attention: Charles L. Mariner
Phone: (317) 267-7260
Facsimile: (317) 267-7658
Escrow Agreement
5
If to the Managing General Partner:
Atlas Resources, Inc.
311 Rouser Road
P.O. Box 611
Moon Township, Pennsylvania 15108
Attention: Jack L. Hollander
Phone: (412) 262-2830
Facsimile: (412) 262-2820
If to Anthem:
Anthem Securities, Inc.
311 Rouser Road
P.O. Box 926
Coraopolis, Pennsylvania 15108
Attention: John S. Coffey
Phone: (412) 262-1680
Facsimile: (412) 262-7430
If to Bryan Funding:
Bryan Funding, Inc.
393 Vanadium Road
Pittsburgh, Pennsylvania 15243
Attention: Richard G. Bryan, Jr.
Phone: (412) 276-9393
Facsimile: (412) 276-9396
Any party may designate any other address to which notices and instructions
shall be sent by notice duly given in accordance with this Agreement.
13. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Pennsylvania.
(b) This Agreement shall be binding on and shall inure to the benefit
of the undersigned and their respective successors and assigns.
(c) This Agreement may be executed in multiple copies, each executed
copy to serve as an original.
Escrow Agreement
6
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be
effective as of the day and year first above written.
NATIONAL CITY BANK OF
PENNSYLVANIA
As Escrow Agent
By:__________________________
(Authorized Officer)
ATLAS RESOURCES, INC.
A Pennsylvania corporation
By:__________________________
Jack L. Hollander, Senior Vice President -
Direct Participation Programs
ANTHEM SECURITIES, INC.
A Pennsylvania corporation
By:__________________________
John S. Coffey, President
BRYAN FUNDING, INC.
A Pennsylvania corporation
By:__________________________
Richard G. Bryan, Jr., President
ATLAS AMERICA PUBLIC #12-2003 LIMITED PARTNERSHIP
By: ATLAS RESOURCES, INC.
Managing General Partner
By:__________________________
Jack L. Hollander, Senior Vice President -
Direct Participation Programs
Escrow Agreement
7
APPENDIX I TO ESCROW AGREEMENT
Compensation for Services of Escrow Agent
Escrow Agent annual fee per year or any part thereof $1,500.00
Returning funds to subscribers pursuant to 6.(a)
herein $20.00 each
Escrow Agreement
8
EXHIBIT "A-2"
ATLAS AMERICA PUBLIC #12-2004(A) LIMITED PARTNERSHIP
ESCROW AGREEMENT
THIS AGREEMENT is made to be effective as of ________________, by and among
Atlas Resources, Inc., a Pennsylvania corporation (the "Managing General
Partner"), Anthem Securities, Inc., a Pennsylvania corporation ("Anthem"), Bryan
Funding, Inc., a Pennsylvania corporation ("Bryan Funding"), collectively Anthem
and Bryan Funding are referred to as the "Dealer-Manager," Atlas America Public
#12-2004(A) Limited Partnership, a Delaware limited partnership to be formed
(the "Partnership") and National City Bank of Pennsylvania, Pittsburgh,
Pennsylvania, as escrow agent (the "Escrow Agent").
WITNESSETH:
WHEREAS, the Managing General Partner intends to offer publicly for sale to
qualified investors (the "Investors") up to _______ limited and investor general
partner interests in the Partnership (the "Units").
WHEREAS, each Investor will be required to pay his subscription in full on
subscribing by check, draft, or money order (the "Subscription Proceeds").
WHEREAS, the cost per Unit will be $10,000 subject to certain discounts of
up to 10.5% ($1,050 per Unit) for sales to the Managing General Partner, its
officers, directors and affiliates, registered investment advisors and their
clients, Selling Agents and their registered representatives and principals, and
investors who buy Units through the officers and directors of the Managing
General Partner. Also, the Managing General Partner, in its discretion, may
accept one-half Unit ($5,000) subscriptions, with larger subscriptions permitted
in $1,000 increments.
WHEREAS, the Managing General Partner and Anthem have executed an agreement
("Anthem Dealer-Manager Agreement") under which Anthem will solicit
subscriptions for Units in all states other than Minnesota and New Hampshire on
a "best efforts" "all or none" basis for Subscription Proceeds of $1,000,000 and
on a "best efforts" basis for the remaining Units on behalf of the Managing
General Partner and the Partnership and under which Anthem has been authorized
to select certain members in good standing of the National Association of
Securities Dealers, Inc. ("NASD") to participate in the offering of the Units
("Selling Agents").
WHEREAS, the Managing General Partner and Bryan Funding have executed an
agreement ("Bryan Funding Dealer-Manager Agreement") under which Bryan Funding
will solicit subscriptions for Units in the states of Minnesota and New
Hampshire on a "best efforts" "all or none" basis for Subscription Proceeds of
$1,000,000 and on a "best efforts" basis for the remaining Units on behalf of
the Managing General Partner and the Partnership and under which Bryan Funding
has been authorized to select certain members in good standing of the NASD to
participate in the offering of the Units ("Selling Agents").
WHEREAS, the Anthem Dealer-Manager Agreement and the Bryan Funding Dealer-
Manager Agreement, collectively referred to as the "Dealer-Manager Agreement,"
provide for compensation to the Dealer-Manager to participate in the offering of
the Units, subject to the discounts set forth above for certain Investors, which
compensation includes, but is not limited to, for each Unit sold:
1
o a 2.5% Dealer-Manager fee;
o a 7% sales commission;
o a .5% accountable marketing expenses fee; and
o a .5% reimbursement of the Selling Agents' bona fide
accountable due diligence expenses;
all or a portion of which will be reallowed to the Selling Agents and
wholesalers.
WHEREAS, under the terms of the Dealer-Manager Agreement the Subscription
Proceeds are required to be held in escrow subject to the receipt and acceptance
by the Managing General Partner of the minimum Subscription Proceeds of
$1,000,000, excluding any optional subscription by the Managing General Partner,
its officers, directors, and Affiliates.
WHEREAS, the Units may also be offered and sold by the officers and
directors of the Managing General Partner without receiving a sales commission
or other compensation on their sales.
WHEREAS, no subscriptions to the Partnership will be accepted after the
"Offering Termination Date," which is the first to occur of either:
o receipt of the maximum Subscription Proceeds of $_______; or
o ________________.
WHEREAS, to facilitate compliance with the terms of the Dealer-Manager
Agreement and Rule 15c2-4 adopted under the Securities Exchange Act of 1934, the
Managing General Partner and the Dealer-Manager desire to have the Subscription
Proceeds deposited with the Escrow Agent and the Escrow Agent agrees to hold the
Subscription Proceeds under the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained in this Agreement, the parties to this Agreement, intending to be
legally bound, agree as follows:
1. Appointment of Escrow Agent. The Managing General Partner, the
Partnership, and the Dealer-Manager appoint the Escrow Agent as the
escrow agent to receive and to hold the Subscription Proceeds deposited
with the Escrow Agent by the Dealer-Manager and the Managing General
Partner under this Agreement, and the Escrow Agent agrees to serve in
this capacity during the term and based on the provisions of this
Agreement.
2. Deposit of Subscription Proceeds. Pending receipt of the minimum
Subscription Proceeds of $1,000,000, the Dealer-Manager and the
Managing General Partner shall deposit the Subscription Proceeds of
each Investor to whom they sell Units with the Escrow Agent and shall
deliver to the Escrow Agent a copy of the Subscription Agreement of the
Investor. Payment for each subscription for Units shall be in the form
of a check made payable to "Atlas America Public #12-2004(A) Limited
Partnership, Escrow Agent, National City Bank of Pennsylvania." The
Escrow Agent shall deliver a receipt to either:
(a) Anthem and the Managing General Partner for each deposit of
Subscription Proceeds made under this Agreement by Anthem;
Escrow Agreement
2
(b) Bryan Funding and the Managing General Partner for each deposit
of Subscription Proceeds made under this Agreement by Bryan
Funding; or
(c) the Managing General Partner for each deposit of Subscription
Proceeds made under this Agreement by the Managing General
Partner.
3. Investment of Subscription Proceeds. The Subscription Proceeds shall be
deposited in an interest bearing account maintained by the Escrow
Agent. This may be a savings account, bank money market account, short-
term certificates of deposit issued by a bank, or short-term
certificates issued or guaranteed by the United States government. The
interest earned shall be added to the Subscription Proceeds and
disbursed in accordance with the provisions of Paragraph 4 or 5 of this
Agreement, as the case may be.
4. Distribution of Subscription Proceeds. If the Escrow Agent:
(a) receives written notice from an authorized officer of the
Managing General Partner that at least the minimum Subscription
Proceeds of $1,000,000 have been received and accepted by the
Managing General Partner; and
(b) determines that Subscription Proceeds for at least $1,000,000
have cleared the banking system and are good;
then the Escrow Agent shall promptly release and distribute to the
Managing General Partner the escrowed Subscription Proceeds which have
cleared the banking system and are good plus any interest paid and
investment income earned on the Subscription Proceeds while held by the
Escrow Agent in the escrow account.
Any remaining Subscription Proceeds, plus any interest paid and
investment income earned on the Subscription Proceeds while held by the
Escrow Agent in the escrow account, shall be promptly released and
distributed to the Managing General Partner by the Escrow Agent as the
Subscription Proceeds clear the banking system and become good.
5. Separate Partnership Account. During the continuation of the offering
after the Partnership is funded with cleared Subscription Proceeds of
at least $1,000,000 and the Escrow Agent receives the notice described
in Paragraph 4 of this Agreement, and before the Offering Termination
Date, any additional Subscription Proceeds may be deposited by the
Dealer-Manager and the Managing General Partner directly in a separate
Partnership account which shall not be subject to the terms of this
Agreement.
6. Distributions to Subscribers.
(a) If the Partnership is not funded as contemplated because less
than the minimum Subscription Proceeds of $1,000,000 have been
received and accepted by the Managing General Partner by twelve
p.m. (noon), local time, on the Offering Termination Date, or
for any other reason, then the Managing General Partner shall
notify the Escrow Agent, and the Escrow Agent promptly shall
distribute to each Investor a refund check made payable to the
Investor in an amount equal to the Subscription Proceeds of the
Investor, plus any interest paid or investment income earned on
the Investor's Subscription Proceeds while held by the Escrow
Agent in the escrow account.
Escrow Agreement
3
(b) If a subscription for Units submitted by an Investor is
rejected by the Managing General Partner for any reason after
the Subscription Proceeds relating to the subscription have
been deposited with the Escrow Agent, then the Managing General
Partner promptly shall notify the Escrow Agent of the
rejection, and the Escrow Agent shall promptly distribute to
the Investor a refund check made payable to the Investor in an
amount equal to the Subscription Proceeds of the Investor, plus
any interest paid or investment income earned on the Investor's
Subscription Proceeds while held by the Escrow Agent in the
escrow account.
7. Compensation and Expenses of Escrow Agent. The Managing General Partner
shall be solely responsible for and shall pay the compensation of the
Escrow Agent for its services under this Agreement, as provided in
Appendix 1 to this Agreement and made a part of this Agreement, and the
charges, expenses (including any reasonable attorneys' fees), and other
out-of-pocket expenses incurred by the Escrow Agent in connection with
the administration of the provisions of this Agreement. The Escrow
Agent shall have no lien on the Subscription Proceeds deposited in the
escrow account unless and until the Partnership is funded with cleared
Subscription Proceeds of at least $1,000,000 and the Escrow Agent
receives the notice described in Paragraph 4 of this Agreement, at
which time the Escrow Agent shall have, and is granted, a prior lien on
any property, cash, or assets held under this Agreement, with respect
to its unpaid compensation and nonreimbursed expenses, superior to the
interests of any other persons or entities.
8. Duties of Escrow Agent. The Escrow Agent shall not be obligated to
accept any notice, make any delivery, or take any other action under
this Agreement unless the notice or request or demand for delivery or
other action is in writing and given or made by the party given the
right or charged with the obligation under this Agreement to give the
notice or to make the request or demand. In no event shall the Escrow
Agent be obligated to accept any notice, request, or demand from anyone
other than the Managing General Partner or the Dealer-Manager.
9. Liability of Escrow Agent. The Escrow Agent shall not be liable for any
damages, or have any obligations other than the duties prescribed in
this Agreement in carrying out or executing the purposes and intent of
this Agreement. However, nothing in this Agreement shall relieve the
Escrow Agent from liability arising out of its own willful misconduct
or gross negligence. The Escrow Agent's duties and obligations under
this Agreement shall be entirely administrative and not discretionary.
The Escrow Agent shall not be liable to any party to this Agreement or
to any third-party as a result of any action or omission taken or made
by the Escrow Agent in good faith. The parties to this Agreement will
indemnify the Escrow Agent, hold the Escrow Agent harmless, and
reimburse the Escrow Agent from, against and for, any and all
liabilities, costs, fees and expenses (including reasonable attorney's
fees) the Escrow Agent may suffer or incur by reason of its execution
and performance of this Agreement. If any legal questions arise
concerning the Escrow Agent's duties and obligations under this
Agreement, then the Escrow Agent may consult with its counsel and rely
without liability on written opinions given to it by its counsel.
The Escrow Agent shall be protected in acting on any written notice,
request, waiver, consent, authorization, or other paper or document
which the Escrow Agent, in good faith, believes to be genuine and what
it purports to be.
If there is any disagreement between any of the parties to this
Agreement, or between them or any other person, resulting in adverse
claims or demands being made in connection with this Agreement,
or if the Escrow Agent, in good faith, is in doubt as to what action it
should take under this Agreement, then the Escrow Agent may, at its
option, refuse to comply with any claims or demands on it or refuse to
take any other action under this Agreement, so long as the disagreement
continues or the doubt exists. In any such event, the Escrow Agent shall
not be or become liable in any way or
Escrow Agreement
4
to any person for its failure or refusal to act and the Escrow Agent
shall be entitled to continue to so refrain from acting until the
dispute is resolved by the parties involved.
National City Bank of Pennsylvania is acting solely as the Escrow Agent
and is not a party to, nor has it reviewed or approved any agreement or
matter of background related to this Agreement, other than this
Agreement itself, and has assumed, without investigation, the authority
of the individuals executing this Agreement to be so authorized on
behalf of the party or parties involved.
10. Resignation or Removal of Escrow Agent. The Escrow Agent may resign as
such after giving thirty days' prior written notice to the other
parties to this Agreement. Similarly, the Escrow Agent may be removed
and replaced after giving thirty days' prior written notice to the
Escrow Agent by the other parties to this Agreement. In either event,
the duties of the Escrow Agent shall terminate thirty days after the
date of the notice (or as of an earlier date as may be mutually
agreeable); and the Escrow Agent shall then deliver the balance of the
Subscription Proceeds (and any interest paid or investment income
earned thereon while held by the Escrow Agent in the escrow account) in
its possession to a successor escrow agent appointed by the other
parties to this Agreement as evidenced by a written notice filed with
the Escrow Agent.
If the other parties to this Agreement are unable to agree on a
successor escrow agent or fail to appoint a successor escrow agent
before the expiration of thirty days following the date of the notice of
the Escrow Agent's resignation or removal, then the Escrow Agent may
petition any court of competent jurisdiction for the appointment of a
successor escrow agent or other appropriate relief. Any resulting
appointment shall be binding on all of the parties to this Agreement.
On acknowledgment by any successor escrow agent of the receipt of the
then remaining balance of the Subscription Proceeds (and any interest
paid or investment income earned thereon while held by the Escrow Agent
in the escrow account), the Escrow Agent shall be fully released and
relieved of all duties, responsibilities, and obligations under this
Agreement.
11. Termination. This Agreement shall terminate and the Escrow Agent shall
have no further obligation with respect to this Agreement after the
distribution of all Subscription Proceeds (and any interest paid or
investment income earned thereon while held by the Escrow Agent in the
escrow account) as contemplated by this Agreement or on the written
consent of all the parties to this Agreement.
12. Notice. Any notices or instructions, or both, to be given under this
Agreement shall be validly given if set forth in writing and mailed by
certified mail, return receipt requested, as follows:
If to the Escrow Agent:
National City Bank of Pennsylvania
One National City Center
Corporate Trust, Suite 655 S
Indianapolis, IN 46255
Attention: Charles L. Mariner
Phone: (317) 267-7260
Facsimile: (317) 267-7658
Escrow Agreement
5
If to the Managing General Partner:
Atlas Resources, Inc.
311 Rouser Road
P.O. Box 611
Moon Township, Pennsylvania 15108
Attention: Jack L. Hollander
Phone: (412) 262-2830
Facsimile: (412) 262-2820
If to Anthem:
Anthem Securities, Inc.
311 Rouser Road
P.O. Box 926
Coraopolis, Pennsylvania 15108
Attention: John S. Coffey
Phone: (412) 262-1680
Facsimile: (412) 262-7430
If to Bryan Funding:
Bryan Funding, Inc.
393 Vanadium Road
Pittsburgh, Pennsylvania 15243
Attention: Richard G. Bryan, Jr.
Phone: (412) 276-9393
Facsimile: (412) 276-9396
Any party may designate any other address to which notices and instructions
shall be sent by notice duly given in accordance with this Agreement.
13. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Pennsylvania.
(b) This Agreement shall be binding on and shall inure to the benefit
of the undersigned and their respective successors and assigns.
(c) This Agreement may be executed in multiple copies, each executed
copy to serve as an original.
Escrow Agreement
6
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be
effective as of the day and year first above written.
NATIONAL CITY BANK OF
PENNSYLVANIA
As Escrow Agent
By:__________________________
(Authorized Officer)
ATLAS RESOURCES, INC.
A Pennsylvania corporation
By:__________________________
Jack L. Hollander, Senior Vice President -
Direct Participation Programs
ANTHEM SECURITIES, INC.
A Pennsylvania corporation
By:__________________________
John S. Coffey, President
BRYAN FUNDING, INC.
A Pennsylvania corporation
By:__________________________
Richard G. Bryan, Jr., President
ATLAS AMERICA PUBLIC #12-2004(A) LIMITED PARTNERSHIP
By:ATLAS RESOURCES, INC.
Managing General Partner
By:__________________________
Jack L. Hollander, Senior Vice President -
Direct Participation Programs
Escrow Agreement
7
APPENDIX I TO ESCROW AGREEMENT
Compensation for Services of Escrow Agent
Escrow Agent annual fee per year or any part thereof $1,500.00
Returning funds to subscribers pursuant to 6.(a) herein $20.00 each
Escrow Agreement
8
EXHIBIT "A-3"
ATLAS AMERICA PUBLIC #12-2004(B) LIMITED PARTNERSHIP
ESCROW AGREEMENT
THIS AGREEMENT is made to be effective as of ________________, by and among
Atlas Resources, Inc., a Pennsylvania corporation (the "Managing General
Partner"), Anthem Securities, Inc., a Pennsylvania corporation ("Anthem"), Bryan
Funding, Inc., a Pennsylvania corporation ("Bryan Funding"), collectively Anthem
and Bryan Funding are referred to as the "Dealer-Manager," Atlas America Public
#12-2004(B) Limited Partnership, a Delaware limited partnership to be formed
(the "Partnership") and National City Bank of Pennsylvania, Pittsburgh,
Pennsylvania, as escrow agent (the "Escrow Agent").
WITNESSETH:
WHEREAS, the Managing General Partner intends to offer publicly for sale to
qualified investors (the "Investors") up to __________ limited and investor
general partner interests in the Partnership (the "Units").
WHEREAS, each Investor will be required to pay his subscription in full on
subscribing by check, draft, or money order (the "Subscription Proceeds").
WHEREAS, the cost per Unit will be $10,000 subject to certain discounts of
up to 10.5% ($1,050 per Unit) for sales to the Managing General Partner, its
officers, directors and affiliates, registered investment advisors and their
clients, Selling Agents and their registered representatives and principals, and
investors who buy Units through the officers and directors of the Managing
General Partner. Also, the Managing General Partner, in its discretion, may
accept one-half Unit ($5,000) subscriptions, with larger subscriptions permitted
in $1,000 increments.
WHEREAS, the Managing General Partner and Anthem have executed an agreement
("Anthem Dealer-Manager Agreement") under which Anthem will solicit
subscriptions for Units in all states other than Minnesota and New Hampshire on
a "best efforts" "all or none" basis for Subscription Proceeds of $1,000,000 and
on a "best efforts" basis for the remaining Units on behalf of the Managing
General Partner and the Partnership and under which Anthem has been authorized
to select certain members in good standing of the National Association of
Securities Dealers, Inc. ("NASD") to participate in the offering of the Units
("Selling Agents").
WHEREAS, the Managing General Partner and Bryan Funding have executed an
agreement ("Bryan Funding Dealer-Manager Agreement") under which Bryan Funding
will solicit subscriptions for Units in the states of Minnesota and New
Hampshire on a "best efforts" "all or none" basis for Subscription Proceeds of
$1,000,000 and on a "best efforts" basis for the remaining Units on behalf of
the Managing General Partner and the Partnership and under which Bryan Funding
has been authorized to select certain members in good standing of the NASD to
participate in the offering of the Units ("Selling Agents").
WHEREAS, the Anthem Dealer-Manager Agreement and the Bryan Funding Dealer-
Manager Agreement, collectively referred to as the "Dealer-Manager Agreement,"
provide for compensation to the Dealer-Manager to participate in the offering of
the Units, subject to the discounts set forth above for certain Investors,
which compensation includes, but is not limited to, for each Unit sold:
1
o a 2.5% Dealer-Manager fee;
o a 7% sales commission;
o a .5% accountable marketing expenses fee; and
o a .5% reimbursement of the Selling Agents' bona fide accountable due
diligence expenses;
all or a portion of which will be reallowed to the Selling Agents and
wholesalers.
WHEREAS, under the terms of the Dealer-Manager Agreement the Subscription
Proceeds are required to be held in escrow subject to the receipt and acceptance
by the Managing General Partner of the minimum Subscription Proceeds of
$1,000,000, excluding any optional subscription by the Managing General Partner,
its officers, directors, and Affiliates.
WHEREAS, the Units may also be offered and sold by the officers and
directors of the Managing General Partner without receiving a sales commission
or other compensation on their sales.
WHEREAS, no subscriptions to the Partnership will be accepted after the
"Offering Termination Date," which is the first to occur of either:
o receipt of the maximum Subscription Proceeds of $________________; or
o _____________________________.
WHEREAS, to facilitate compliance with the terms of the Dealer-Manager
Agreement and Rule 15c2-4 adopted under the Securities Exchange Act of 1934, the
Managing General Partner and the Dealer-Manager desire to have the Subscription
Proceeds deposited with the Escrow Agent and the Escrow Agent agrees to hold the
Subscription Proceeds under the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained in this Agreement, the parties to this Agreement, intending to be
legally bound, agree as follows:
1. Appointment of Escrow Agent. The Managing General Partner, the
Partnership, and the Dealer-Manager appoint the Escrow Agent as the
escrow agent to receive and to hold the Subscription Proceeds deposited
with the Escrow Agent by the Dealer-Manager and the Managing General
Partner under this Agreement, and the Escrow Agent agrees to serve in
this capacity during the term and based on the provisions of this
Agreement.
2. Deposit of Subscription Proceeds. Pending receipt of the minimum
Subscription Proceeds of $1,000,000, the Dealer-Manager and the
Managing General Partner shall deposit the Subscription Proceeds of
each Investor to whom they sell Units with the Escrow Agent and shall
deliver to the Escrow Agent a copy of the Subscription Agreement of the
Investor. Payment for each subscription for Units shall be in the form
of a check made payable to "Atlas America Public #12-2004(B) Limited
Partnership, Escrow Agent, National City Bank of Pennsylvania." The
Escrow Agent shall deliver a receipt to either:
(a) Anthem and the Managing General Partner for each deposit of
Subscription Proceeds made under this Agreement by Anthem;
Escrow Agreement
2
(b) Bryan Funding and the Managing General Partner for each deposit
of Subscription Proceeds made under this Agreement by Bryan
Funding; or
(c) the Managing General Partner for each deposit of Subscription
Proceeds made under this Agreement by the Managing General
Partner.
3. Investment of Subscription Proceeds. The Subscription Proceeds shall be
deposited in an interest bearing account maintained by the Escrow
Agent. This may be a savings account, bank money market account, short-
term certificates of deposit issued by a bank, or short-term
certificates issued or guaranteed by the United States government. The
interest earned shall be added to the Subscription Proceeds and
disbursed in accordance with the provisions of Paragraph 4 or 5 of this
Agreement, as the case may be.
4. Distribution of Subscription Proceeds. If the Escrow Agent:
(a) receives written notice from an authorized officer of the
Managing General Partner that at least the minimum Subscription
Proceeds of $1,000,000 have been received and accepted by the
Managing General Partner; and
(b) determines that Subscription Proceeds for at least $1,000,000
have cleared the banking system and are good;
then the Escrow Agent shall promptly release and distribute to the
Managing General Partner the escrowed Subscription Proceeds which have
cleared the banking system and are good plus any interest paid and
investment income earned on the Subscription Proceeds while held by the
Escrow Agent in the escrow account.
Any remaining Subscription Proceeds, plus any interest paid and
investment income earned on the Subscription Proceeds while held by the
Escrow Agent in the escrow account, shall be promptly released and
distributed to the Managing General Partner by the Escrow Agent as the
Subscription Proceeds clear the banking system and become good.
5. Separate Partnership Account. During the continuation of the offering
after the Partnership is funded with cleared Subscription Proceeds of
at least $1,000,000 and the Escrow Agent receives the notice described
in Paragraph 4 of this Agreement, and before the Offering Termination
Date, any additional Subscription Proceeds may be deposited by the
Dealer-Manager and the Managing General Partner directly in a separate
Partnership account which shall not be subject to the terms of this
Agreement.
6. Distributions to Subscribers.
(a) If the Partnership is not funded as contemplated because less
than the minimum Subscription Proceeds of $1,000,000 have been
received and accepted by the Managing General Partner by twelve
p.m. (noon), local time, on the Offering Termination Date, or
for any other reason, then the Managing General Partner shall
notify the Escrow Agent, and the Escrow Agent promptly shall
distribute to each Investor a refund check made payable to the
Investor in an amount equal to the Subscription Proceeds of the
Investor, plus any interest paid or investment income earned on
the Investor's Subscription Proceeds while held by the Escrow
Agent in the escrow account.
Escrow Agreement
3
(b) If a subscription for Units submitted by an Investor is
rejected by the Managing General Partner for any reason after
the Subscription Proceeds relating to the subscription have
been deposited with the Escrow Agent, then the Managing General
Partner promptly shall notify the Escrow Agent of the
rejection, and the Escrow Agent shall promptly distribute to
the Investor a refund check made payable to the Investor in an
amount equal to the Subscription Proceeds of the Investor, plus
any interest paid or investment income earned on the Investor's
Subscription Proceeds while held by the Escrow Agent in the
escrow account.
7. Compensation and Expenses of Escrow Agent. The Managing General Partner
shall be solely responsible for and shall pay the compensation of the
Escrow Agent for its services under this Agreement, as provided in
Appendix 1 to this Agreement and made a part of this Agreement, and the
charges, expenses (including any reasonable attorneys' fees), and other
out-of-pocket expenses incurred by the Escrow Agent in connection with
the administration of the provisions of this Agreement. The Escrow
Agent shall have no lien on the Subscription Proceeds deposited in the
escrow account unless and until the Partnership is funded with cleared
Subscription Proceeds of at least $1,000,000 and the Escrow Agent
receives the notice described in Paragraph 4 of this Agreement, at
which time the Escrow Agent shall have, and is granted, a prior lien on
any property, cash, or assets held under this Agreement, with respect
to its unpaid compensation and nonreimbursed expenses, superior to the
interests of any other persons or entities.
8. Duties of Escrow Agent. The Escrow Agent shall not be obligated to
accept any notice, make any delivery, or take any other action under
this Agreement unless the notice or request or demand for delivery or
other action is in writing and given or made by the party given the
right or charged with the obligation under this Agreement to give the
notice or to make the request or demand. In no event shall the Escrow
Agent be obligated to accept any notice, request, or demand from anyone
other than the Managing General Partner or the Dealer-Manager.
9. Liability of Escrow Agent. The Escrow Agent shall not be liable for any
damages, or have any obligations other than the duties prescribed in
this Agreement in carrying out or executing the purposes and intent of
this Agreement. However, nothing in this Agreement shall relieve the
Escrow Agent from liability arising out of its own willful misconduct
or gross negligence. The Escrow Agent's duties and obligations under
this Agreement shall be entirely administrative and not discretionary.
The Escrow Agent shall not be liable to any party to this Agreement or
to any third-party as a result of any action or omission taken or made
by the Escrow Agent in good faith. The parties to this Agreement will
indemnify the Escrow Agent, hold the Escrow Agent harmless, and
reimburse the Escrow Agent from, against and for, any and all
liabilities, costs, fees and expenses (including reasonable attorney's
fees) the Escrow Agent may suffer or incur by reason of its execution
and performance of this Agreement. If any legal questions arise
concerning the Escrow Agent's duties and obligations under this
Agreement, then the Escrow Agent may consult with its counsel and rely
without liability on written opinions given to it by its counsel.
The Escrow Agent shall be protected in acting on any written notice,
request, waiver, consent, authorization, or other paper or document
which the Escrow Agent, in good faith, believes to be genuine and what
it purports to be.
If there is any disagreement between any of the parties to this
Agreement, or between them or any other person, resulting in adverse
claims or demands being made in connection with this Agreement, or if
the Escrow Agent, in good faith, is in doubt as to what action it should
take under this Agreement, then the Escrow Agent may, at its option,
refuse to comply with any claims or demands on it or refuse to take any
other action under this Agreement, so long as the disagreement continues
or the doubt exists. In any such event, the Escrow Agent shall not be or
become liable in any way or
Escrow Agreement
4
to any person for its failure or refusal to act and the Escrow Agent
shall be entitled to continue to so refrain from acting until the
dispute is resolved by the parties involved.
National City Bank of Pennsylvania is acting solely as the Escrow Agent
and is not a party to, nor has it reviewed or approved any agreement or
matter of background related to this Agreement, other than this
Agreement itself, and has assumed, without investigation, the authority
of the individuals executing this Agreement to be so authorized on
behalf of the party or parties involved.
10. Resignation or Removal of Escrow Agent. The Escrow Agent may resign as
such after giving thirty days' prior written notice to the other
parties to this Agreement. Similarly, the Escrow Agent may be removed
and replaced after giving thirty days' prior written notice to the
Escrow Agent by the other parties to this Agreement. In either event,
the duties of the Escrow Agent shall terminate thirty days after the
date of the notice (or as of an earlier date as may be mutually
agreeable); and the Escrow Agent shall then deliver the balance of the
Subscription Proceeds (and any interest paid or investment income
earned thereon while held by the Escrow Agent in the escrow account) in
its possession to a successor escrow agent appointed by the other
parties to this Agreement as evidenced by a written notice filed with
the Escrow Agent.
If the other parties to this Agreement are unable to agree on a
successor escrow agent or fail to appoint a successor escrow agent
before the expiration of thirty days following the date of the notice of
the Escrow Agent's resignation or removal, then the Escrow Agent may
petition any court of competent jurisdiction for the appointment of a
successor escrow agent or other appropriate relief. Any resulting
appointment shall be binding on all of the parties to this Agreement.
On acknowledgment by any successor escrow agent of the receipt of the
then remaining balance of the Subscription Proceeds (and any interest
paid or investment income earned thereon while held by the Escrow Agent
in the escrow account), the Escrow Agent shall be fully released and
relieved of all duties, responsibilities, and obligations under this
Agreement.
11. Termination. This Agreement shall terminate and the Escrow Agent shall
have no further obligation with respect to this Agreement after the
distribution of all Subscription Proceeds (and any interest paid or
investment income earned thereon while held by the Escrow Agent in the
escrow account) as contemplated by this Agreement or on the written
consent of all the parties to this Agreement.
12. Notice. Any notices or instructions, or both, to be given under this
Agreement shall be validly given if set forth in writing and mailed by
certified mail, return receipt requested, as follows:
If to the Escrow Agent:
National City Bank of Pennsylvania
One National City Center
Corporate Trust, Suite 655 S
Indianapolis, IN 46255
Attention: Charles L. Mariner
Phone: (317) 267-7260
Facsimile: (317) 267-7658
Escrow Agreement
5
If to the Managing General Partner:
Atlas Resources, Inc.
311 Rouser Road
P.O. Box 611
Moon Township, Pennsylvania 15108
Attention: Jack L. Hollander
Phone: (412) 262-2830
Facsimile: (412) 262-2820
If to Anthem:
Anthem Securities, Inc.
311 Rouser Road
P.O. Box 926
Coraopolis, Pennsylvania 15108
Attention: John S. Coffey
Phone: (412) 262-1680
Facsimile: (412) 262-7430
If to Bryan Funding:
Bryan Funding, Inc.
393 Vanadium Road
Pittsburgh, Pennsylvania 15243
Attention: Richard G. Bryan, Jr.
Phone: (412) 276-9393
Facsimile: (412) 276-9396
Any party may designate any other address to which notices and instructions
shall be sent by notice duly given in accordance with this Agreement.
13. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Pennsylvania.
(b) This Agreement shall be binding on and shall inure to the benefit
of the undersigned and their respective successors and assigns.
(c) This Agreement may be executed in multiple copies, each executed
copy to serve as an original.
Escrow Agreement
6
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be
effective as of the day and year first above written.
NATIONAL CITY BANK OF
PENNSYLVANIA
As Escrow Agent
By:__________________________
(Authorized Officer)
ATLAS RESOURCES, INC.
A Pennsylvania corporation
By:__________________________
Jack L. Hollander, Senior Vice President -
Direct Participation Programs
ANTHEM SECURITIES, INC.
A Pennsylvania corporation
By:__________________________
John S. Coffey, President
BRYAN FUNDING, INC.
A Pennsylvania corporation
By:__________________________
Richard G. Bryan, Jr., President
ATLAS AMERICA PUBLIC #12-2004(B) LIMITED PARTNERSHIP
By: ATLAS RESOURCES, INC.
Managing General Partner
By:__________________________
Jack L. Hollander, Senior Vice President -
Direct Participation Programs
Escrow Agreement
7
APPENDIX I TO ESCROW AGREEMENT
Compensation for Services of Escrow Agent
Escrow Agent annual fee per year or any part thereof $1,500.00
Returning funds to subscribers pursuant to 6.(a)
herein $20.00 each
Escrow Agreement
8
EXHIBIT "B"
SELLING AGENT AGREEMENT
WITH ANTHEM SECURITIES, INC.
TO: _________________________________________
RE: ATLAS AMERICA PUBLIC #12-2003 PROGRAM
Gentlemen:
Atlas Resources, Inc. will be the Managing General Partner in a series of
up to three limited partnerships to be organized under the Delaware Revised
Uniform Limited Partnership Act:
o Atlas America Public #12-2003;
o Atlas America Public #12-2004(A); and
o Atlas America Public #12-2004(B).
which are referred to as the "Partnership" or the "Partnerships." The Units in
the Partnerships, which are referred to as the "Units," and the offering are
described in the enclosed Prospectus dated ______, 2003, which is referred to as
the "Prospectus." Prospectuses relating to the Units have been furnished to you
with this Agreement.
Our firm, Anthem Securities, Inc., which is referred to as the "Dealer-
Manager," has entered into a Dealer-Manager Agreement for sales in all states
other than Minnesota and New Hampshire, a copy of which has been furnished to
you and is incorporated in this Agreement by reference, with the Managing
General Partner and the Partnerships under which the Dealer-Manager has agreed
to form a group of NASD member firms, which are referred to as the "Selling
Agents." The Selling Agents will obtain subscriptions for Units in each
Partnership in all states other than:
o Minnesota; and
o New Hampshire
on a "best efforts" basis under the Securities Act of 1933, as amended, which is
referred to as the "Act" and the provisions of the Prospectus.
You are invited to become one of the Selling Agents on a non-exclusive
basis. By your acceptance below you agree to act in that capacity and to use
your best efforts, in accordance with the terms and conditions of this
Agreement, to solicit subscriptions for Units in each Partnership at the time
the Partnership is being offered as provided in Section 1 of the Dealer- Manager
Agreement in all states other than:
o Minnesota; and
Anthem Securities, Inc.
Selling Agent Agreement
1
o New Hampshire.
This Agreement, however, shall not be construed to prohibit your participation
as a selling agent in Minnesota and New Hampshire under a duly executed selling
agent agreement entered into by you and any other authorized "Dealer- Manager"
for the Partnerships.
1. Representations and Warranties of Selling Agent. You represent and
warrant to the Dealer-Manager that:
(a) You are a corporation duly organized, validly existing, and in
good standing under the laws of the state of your formation or of
any jurisdiction to the laws of which you are subject, with all
requisite power and authority to enter into this Agreement and to
carry out your obligations under this Agreement.
(b) This Agreement when accepted and approved by you will be duly
authorized, executed, and delivered by you and will be a valid
and binding agreement on your part in accordance with its terms.
(c) The consummation of the transactions contemplated by this
Agreement and the Prospectus will not result in the following:
(i) any breach of any of the terms or conditions of, or
constitute a default under your Articles of Incorporation
or Bylaws, or any other indenture, agreement, or other
instrument to which you are a party; or
(ii) any violation of any order applicable to you of any court
or any federal or state regulatory body or administrative
agency having jurisdiction over you or over your
affiliates.
(d) You are duly registered under the provisions of the Securities
Exchange Act of 1934, which is referred to as the "Act of
1934," as a dealer, and you are a member in good standing of
the NASD. You are duly registered as a broker/dealer in the
states where you are required to be registered in order to
carry out your obligations as contemplated by this Agreement
and the Prospectus. You agree to maintain all the foregoing
registrations in good standing throughout the term of the offer
and sale of the Units, and you agree to comply with all
statutes and other requirements applicable to you as a broker/
dealer under those registrations.
(e) Pursuant to your appointment as a Selling Agent, you shall
comply with all the provisions of the Act, insofar as the Act
applies to your activities under this Agreement. Further, you
shall not engage in any activity which would cause the offer
and/or sale of the Units not to comply with the Act, the Act of
1934, the applicable rules and regulations of the Securities
and Exchange Commission, which is referred to as the
"Commission," the applicable state securities laws and
regulations, this Agreement, and the NASD Conduct Rules
including Rules 2420, 2730, 2740, 2750, and 2810(b)(2) and
(b)(3), which provide as follows:
Sec. (b)(2)
Suitability
(A) A member or person associated with a member
shall not underwrite or participate in a public
offering of a direct participation program
unless standards of suitability have been
Anthem Securities, Inc.
Selling Agent Agreement
2
established by the program for participants
therein and such standards are fully disclosed
in the prospectus and are consistent with the
provisions of subparagraph (B) of this section.
(B) In recommending to a participant the purchase,
sale or exchange of an interest in a direct
participation program, a member or person
associated with a member shall:
(i) have reasonable grounds to believe, on
the basis of information obtained from
the participant concerning his
investment objectives, other
investments, financial situation and
needs, and any other information known
by the member or associated person,
that:
(a) the participant is or will be in
a financial position appropriate
to enable him to realize to a
significant extent the benefits
described in the prospectus,
including the tax benefits where
they are a significant aspect of
the program;
(b) the participant has a fair market
net worth sufficient to sustain
the risks inherent in the program,
including loss of investment and
lack of liquidity; and
(c) the program is otherwise suitable
for the participant; and
(ii) maintain in the files of the member
documents disclosing the basis upon which
the determination of suitability was
reached as to each participant.
(C) Notwithstanding the provisions of subparagraphs
(A) and (B) hereof, no member shall execute any
transaction in a direct participation program in
a discretionary account without prior written
approval of the transaction by the customer.
Sec. (b)(3)
Disclosure
(A) Prior to participating in a public offering of a
direct participation program, a member or person
associated with a member shall have reasonable
grounds to believe, based on information made
available to him by the sponsor through a
prospectus or other materials, that all material
facts are adequately and accurately disclosed
and provide a basis for evaluating the program.
(B) In determining the adequacy of disclosed facts
pursuant to subparagraph (A) hereof, a member or
person associated with a member shall obtain
information on material facts relating at a
Anthem Securities, Inc.
Selling Agent Agreement
3
minimum to the following, if relevant in view of
the nature of the program:
(i) items of compensation;
(ii) physical properties;
(iii) tax aspects;
(iv) financial stability and experience of the
sponsor;
(v) the program's conflicts and risk factors;
and
(vi) appraisals and other pertinent reports.
(C) For purposes of subparagraphs (A) and (B) hereof,
a member or person associated with a member may
rely upon the results of an inquiry conducted by
another member or members, provided that:
(i) the member or person associated with a
member has reasonable grounds to believe
that such inquiry was conducted with due
care;
(ii) the results of the inquiry were provided
to the member or person associated with a
member with the consent of the member or
members conducting or directing the
inquiry; and
(iii) no member that participated in the inquiry
is a sponsor of the program or an
affiliate of such sponsor.
(D) Prior to executing a purchase transaction in a
direct participation program, a member or person
associated with a member shall inform the
prospective participant of all pertinent facts
relating to the liquidity and marketability of
the program during the term of investment.
(f) You shall not offer or sell the Units in any state until you have
been advised in writing by the Managing General Partner, or the
Managing General Partner's special counsel, that the offer or
sale of the Units:
(i) has been qualified in the state;
(ii) is exempt from the qualification requirements imposed by
the state; or
(iii) the qualification is otherwise not required.
(g) You have received copies of the Prospectus relating to the Units
and you have relied only on the statements contained in the
Prospectus and not on any other statements whatsoever, either
written or oral, with respect to the details of the offering of
Units.
You shall deliver a copy of the Prospectus to each subscriber to
whom you sell the Units at or before the completion of any sale
of Units to such subscriber (which sale shall be
Anthem Securities, Inc.
Selling Agent Agreement
4
deemed, for the purposes of this Agreement to occur on the date
on which that subscriber delivers subscription funds to the
escrow agent), or earlier if required by the blue sky or
securities laws of any state. Unless advised otherwise by the
Managing General Partner, you may choose to provide each offeree
with the following sales materials which are collectively
referred to as the "Sales Literature":
(i) a flyer entitled "Atlas America Public #12-2003 Program";
(ii) an article entitled "Tax Rewards with Oil and Gas
Partnerships";
(iii) a brochure of tax scenarios entitled "How an Investment
in Atlas America Public #12-2003 Program can Help Achieve
an Investor's Tax Objectives";
(iv) a brochure entitled "Investing in Atlas America Public
#12-2003 Program";
(v) a booklet entitled "Outline of Tax Consequences of Oil
and Gas Drilling Programs"; and
(vi) possibly other supplementary materials.
Any such Sales Literature, if distributed, must have been
preceded or must be accompanied by the Prospectus
(h) You agree that you shall not place any advertisement or other
solicitation with respect to the Units (including without
limitation any material for use in any newspaper, magazine, radio
or television commercial, telephone recording, motion picture, or
other public media) without:
(i) the prior written approval of the Managing General
Partner; and
(ii) the prior written approval of the form and content
thereof by the Commission, the NASD and the securities
authorities of the states where such advertisement or
solicitation is to be circulated.
Any such advertisements or solicitations shall be at your
expense.
(i) If a supplement or amendment to the Prospectus is prepared and
delivered to you by the Managing General Partner or the Dealer-
Manager, you agree as follows:
(i) to distribute each supplement or amendment to the
Prospectus to every person who has previously received a
copy of the Prospectus from you; and
(ii) to include each supplement or amendment in all future
deliveries of any Prospectus.
(j) In connection with any offer or sale of the Units, you agree to
the following:
(i) to comply in all respects with statements set forth in
the Prospectus, the Partnership Agreement, and any
supplements or amendments to the Prospectus;
Anthem Securities, Inc.
Selling Agent Agreement
5
(ii) not to make any statement inconsistent with the
statements in the Prospectus, the Partnership Agreement,
and any supplements or amendments to the Prospectus;
(iii) not to make any untrue or misleading statements of a
material fact in connection with the Units; and
(iv) not to provide any written information, statements, or
sales materials other than the Prospectus, the Sales
Literature, and any supplements or amendments to the
Prospectus unless approved in writing by the Managing
General Partner.
(k) You agree to use your best efforts in the solicitation and sale
of the Units, including that:
(i) you comply with all the provisions of the Act, the Act of
1934, the applicable rules and regulations of the
Commission, the applicable state securities laws and
regulations, this Agreement, and the NASD Conduct Rules;
(ii) the prospective purchasers meet the suitability
requirements set forth in the Prospectus, the
Subscription Agreement, and this Agreement; and
(iii) the prospective purchasers properly complete and execute
the Subscription Agreement, which has been provided as
Exhibit (I-B) to the Partnership Agreement, Exhibit (A)
of the Prospectus, together with any additional forms
provided in any supplement or amendment to the
Prospectus, or otherwise provided to you by the Managing
General Partner or the Dealer-Manager to be completed by
prospective purchasers.
The Managing General Partner shall have the right to reject any
subscription at any time for any reason without liability to it.
Subscription funds and executed subscription packets shall be
transmitted as set forth in Section 11 of this Agreement.
(l) Although not anticipated, if you assist in any transfers of the
Units, then you shall comply with the requirements of Rules
2810(b)(2)(B) and (b)(3)(D) of the NASD Conduct Rules.
(m) You agree and covenant that:
(i) the representations and warranties you make in this
Agreement are and shall be true and correct at the
applicable closing date; and
(ii) you shall and have fulfilled all your obligations under
this Agreement at the applicable closing date.
2. Commissions.
(a) Subject to the receipt of the minimum required subscription
proceeds of $1,000,000 as described in Section 4(d) of the
Dealer-Manager Agreement, and the discounts set forth in Section
4(c) of the Dealer-Manager Agreement for sales to the following:
(i) the Managing General Partner, its officers, directors and
affiliates;
(ii) registered investment advisors and their clients;
Anthem Securities, Inc.
Selling Agent Agreement
6
(iii) Selling Agents and their registered representatives and
principals; and
(iv) investors who buy Units through the officers or directors
of the Managing General Partner;
the Dealer-Manager is entitled to receive from the Managing
General Partner a 7% Sales Commission, a .5% accountable
marketing expense fee, and a .5% reimbursement of the Selling
Agents' bona fide accountable due diligence expenses per Unit,
based on the aggregate amount of all Unit subscriptions to the
Partnership secured by the Dealer-Manager or the selling group
formed by the Dealer-Manager and accepted by the Managing General
Partner.
Subject to the terms and conditions set forth in this Agreement,
including the Dealer-Manager's receipt from you of the
documentation required of you in Section 1 of this Agreement, the
Dealer-Manager agrees to pay you on Units sold by you and
accepted by the Managing General Partner a 7% Sales Commission,
up to a .5% reimbursement of your bona fide accountable due
diligence expenses and, subject to the performance by you of your
obligations under Appendix I to this Agreement, which is
incorporated in this Agreement by reference, up to a .5%
reimbursement of your bona fide accountable marketing expenses,
which are presented to and approved in advance by the
Dealer-Manager, per Unit.
Your Sales Commissions, the up to .5% reimbursement of your bona
fide accountable due diligence expenses, and the up to .5%
reimbursement of your bona fide accountable marketing expenses,
shall be paid to you within seven business days after the
Dealer-Manager has received the related amounts owed to it under
the Dealer-Manager Agreement, which the Dealer-Manager is
entitled to receive within five business days after the
conditions described in Section 4(e) of the Dealer-Manager
Agreement are satisfied and approximately every two weeks
thereafter until the respective Partnership's Offering
Termination Date, which is described in Section 1 of the
Dealer-Manager Agreement. The balance shall be paid to the
Dealer-Manager within fourteen business days after the respective
Partnership's Offering Termination Date.
(b) Notwithstanding anything in this Agreement to the contrary, you
agree to waive payment of your Sales Commissions, the up to .5%
reimbursement of your bona fide accountable marketing expenses,
and the up to .5% reimbursement of your bona fide accountable
due diligence expenses as set forth above in (a) above, until
the Dealer-Manager is in receipt of the related amounts owed to
it under the Dealer-Manager Agreement, and the Dealer-Manager's
liability to pay your compensation under this Agreement shall
be limited solely to the proceeds of the related amounts owed
to it under the Dealer-Manager Agreement.
(c) As provided in Section 4(d) of the Dealer-Manager Agreement, a
Partnership shall not begin operations unless it receives
subscription proceeds for at least $1,000,000 by its respective
Offering Termination Date. If this amount is not secured by the
respective Partnership's Offering Termination Date, then
nothing shall be payable to you for the respective Partnership
and all funds advanced by subscribers for Units in the
respective Partnership shall be returned to them with interest
earned, if any.
Anthem Securities, Inc.
Selling Agent Agreement
7
3. Blue Sky Qualification. The Managing General Partner may elect not to
qualify or register Units in any state or jurisdiction in which it deems
the qualification or registration is not warranted for any reason in its
sole discretion. On application to the Dealer-Manager you will be
informed as to the states and jurisdictions in which the Units have been
qualified for sale or are exempt under the respective securities or
"Blue Sky" laws of those states and jurisdictions.
Notwithstanding the foregoing, the Dealer-Manager, the Partnerships, and
the Managing General Partner have not assumed and will not assume any
obligation or responsibility as to your right to act as a broker/ dealer
with respect to the Units in any state or jurisdiction.
4. Expense of Sale. The expenses in connection with the offer and sale of
the Units shall be payable as set forth below.
(a) The Dealer-Manager shall pay all expenses incident to the
performance of its obligations under this Agreement, including
the fees and expenses of its attorneys and accountants, even if
the offering of any or all of the Partnerships is not
successfully completed.
(b) You shall pay all expenses incident to the performance of your
obligations under this Agreement, including the fees and expenses
of your own counsel and accountants, even if the offering of any
or all of the Partnerships is not successfully completed.
5. Conditions of Your Duties. Your obligations under this Agreement, as of
the date of this Agreement and at the applicable closing date, shall be
subject to the following:
(a) the performance by the Dealer-Manager of its obligations under
this Agreement; and
(b) the performance by the Managing General Partner of its
obligations under the Dealer-Manager Agreement.
6. Conditions of Dealer-Manager's Duties. The Dealer-Manager's obligations
under this Agreement, including the duty to pay compensation to you as
set forth in Section 2 of this Agreement, shall be subject to the
following:
(a) the accuracy, as of the date of this Agreement and at the
applicable closing date as if made at the applicable closing
date, of your representations and warranties made in this
Agreement;
(b) the performance by you of your obligations under this Agreement;
and
(c) the Dealer-Manager's receipt, at or before the applicable closing
date, of a fully executed Subscription Agreement for each
prospective purchaser as required by Section 1(k) of this
Agreement.
7. Indemnification.
(a) You shall indemnify and hold harmless the Dealer-Manager, the
Managing General Partner, each Partnership and its attorneys
against any losses, claims, damages or liabilities, joint or
several, to which they may become subject under the Act, the
Act of 1934, or otherwise insofar as the losses, claims,
damages, or liabilities (or actions in respect thereof) arise
out of or are based on your breach of any of your duties and
Anthem Securities, Inc.
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8
obligations, representations, or warranties under the terms or
provisions of this Agreement, and you shall reimburse them for
any legal or other expenses reasonably incurred in connection
with investigating or defending the losses, claims, damages,
liabilities, or actions.
(b) The Dealer-Manager shall indemnify and hold you harmless
against any losses, claims, damages, or liabilities, joint or
several, to which you may become subject under the Act, the Act
of 1934, or otherwise insofar as the losses, claims, damages,
or liabilities (or actions in respect thereof) arise out of or
are based on the Dealer-Manager's breach of any of its duties
and obligations, representations, or warranties under the terms
or provisions of this Agreement, and the Dealer-Manager shall
reimburse you for any legal or other expenses reasonably
incurred in connection with investigating or defending the
losses, claims, damages, liabilities, or actions.
(c) The foregoing indemnity agreements shall extend on the same terms
and conditions to, and shall inure to the benefit of, each
person, if any, who controls each indemnified party within the
meaning of the Act.
(d) Promptly after receipt by an indemnified party of notice of the
commencement of any action, the indemnified party shall, if a
claim in respect of the action is to be made against the
indemnifying party under this Section, notify the indemnifying
party in writing of the commencement of the action; but the
omission to promptly notify the indemnifying party shall not
relieve the indemnifying party from any liability which it may
have to the indemnified party. If any action is brought against
an indemnified party, it shall notify the indemnifying party of
the commencement of the action, and the indemnifying party
shall be entitled to participate in, and, to the extent that it
wishes, jointly with any other indemnifying party similarly
notified, to assume the defense of the action, with counsel
satisfactory to the indemnified and indemnifying parties. After
the indemnified party has received notice from the agreed on
counsel that the defense of the action under this paragraph has
been assumed, the indemnifying party shall not be responsible
for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense of the action
other than with respect to the agreed on counsel who assumed
the defense of the action.
8. Representations and Agreements to Survive Delivery. All representations,
warranties, and agreements of the Dealer-Manager and you in this
Agreement, including the indemnity agreements contained in Section 7 of
this Agreement, shall:
(a) survive the delivery, execution and closing of this Agreement;
(b) remain operative and in full force and effect regardless of any
investigation made by or on behalf of you or any person who
controls you within the meaning of the Act, by the Dealer-
Manager, or any of its officers, directors or any person who
controls the Dealer-Manager within the meaning of the Act, or any
other indemnified party; and
(c) survive delivery of the Units.
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9. Termination.
(a) You shall have the right to terminate this Agreement other than
the indemnification provisions of Section 7 of this Agreement by
giving notice as specified in Section 16 of this Agreement any
time at or before a closing date:
(i) if the Dealer-Manager has failed, refused, or been unable
at or before a closing date, to perform any of its
obligations under this Agreement; or
(ii) there has occurred an event materially and adversely
affecting the value of the Units.
If you elect to terminate this Agreement other than the indemnification
provisions of Section 7 of this Agreement, then the Dealer-Manager shall
be promptly notified by you by telephone, e-mail, facsimile, or
telegram, confirmed by letter.
(b) The Dealer-Manager may terminate this Agreement other than the
indemnification provisions of Section 7 of this Agreement, for
any reason and at any time, by promptly giving notice to you by
telephone, e-mail, facsimile or telegram, confirmed by letter.
10. Format of Checks/Escrow Agent. Pending receipt of the minimum
subscription proceeds of $1,000,000 as set forth in Section 4(d) of the
Dealer-Manager Agreement, the Dealer-Manager and you, including if you
are a customer carrying broker/dealer, agree that all subscribers shall
be instructed to make their checks, drafts, or money orders payable
solely to the Escrow Agent for the Partnership in which the Units are
then being offered as follows:
(a) "Atlas Public #12-2003 Limited Partnership, Escrow Agent,
National City Bank"; or
(b) "Atlas Public #12-2004(_)Limited Partnership, Escrow Agent,
National City Bank"
as agent for the respective Partnership, and you, including if you are a
customer carrying broker/dealer, agree to comply with Rule 15c2-4
adopted under the Act of 1934.
If you receive a check, draft, or money order not conforming to the
foregoing instructions, then you shall return the check, draft, or money
order directly to the subscriber not later than the end of the next
business day following its receipt by you from the subscriber. If the
Dealer-Manager receives a check, draft, or money order not conforming to
the foregoing instructions, then the Dealer-Manager shall return the
check, draft, or money order to you not later than the end of the next
business day following its receipt by the Dealer-Manager and you shall
then return the check, draft, or money order directly to the subscriber
not later than the end of the next business day following its receipt by
you from the Dealer-Manager. Checks, drafts, or money orders received by
you which conform to the foregoing instructions shall be transmitted by
you under Section 11 "Transmittal Procedures," below.
You agree that you are bound by the terms of the Escrow Agreement, a
copy of which is attached to the Dealer-Manager Agreement as Exhibit
"A."
11. Transmittal Procedures. You, including if you are a customer carrying
broker/dealer, shall transmit received investor funds in accordance with
the following procedures.
Anthem Securities, Inc.
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10
(a) Pending receipt of a Partnership's minimum subscription
proceeds of $1,000,000 as set forth in Section 4(d) of the
Dealer-Manager Agreement, you shall promptly transmit, any and
all checks, drafts, and money orders received by you from
subscribers and the original executed Subscription Agreement to
the Dealer-Manager by the end of the next business day
following receipt of the check, draft, or money order by you.
By the end of the next business day following its receipt of the
check, draft, or money order and the original executed
subscription documents, the Dealer-Manager shall transmit the
check, draft, or money order and a copy of the executed
Subscription Agreement to the Escrow Agent, and the original
executed Subscription Agreement and a copy of the check, draft,
or money order to the Managing General Partner.
(b) On receipt by you of notice from the Managing General Partner
or the Dealer-Manager that a Partnership's minimum subscription
proceeds of $1,000,000 as set forth in Section 4(d) of the
Dealer-Manager Agreement have been received, you agree that all
subscribers then may be instructed, in the Managing General
Partner's sole discretion, to make their checks, drafts, or
money orders payable solely to the Partnership then being
offered.
Thereafter, you shall promptly transmit any and all checks,
drafts, and money orders received by you from subscribers and the
original executed Subscription Agreement to the Dealer- Manager
by the end of the next business day following receipt of the
check, draft, or money order by you. By the end of the next
business day following its receipt of the check, draft, or money
order and original Subscription Agreement, the Dealer- Manager
shall transmit the check, draft, or money order and the original
executed Subscription Agreement to the Managing General Partner.
12. Parties. This Agreement shall inure to the benefit of and be binding on
you, the Dealer-Manager, and any respective successors and assigns.
This Agreement shall also inure to the benefit of the indemnified
parties, their successors and assigns. This Agreement is intended to be
and is for the sole and exclusive benefit of the parties to this
Agreement, including their respective successors and assigns, and the
indemnified parties and their successors and assigns, and for the
benefit of no other person. No other person shall have any legal or
equitable right, remedy or claim under or in respect of this Agreement.
No purchaser of any of the Units from you shall be construed a
successor or assign merely by reason of the purchase.
13. Relationship. You are not authorized to hold yourself out as agent of
the Dealer-Manager, the Managing General Partner, a Partnership or any
other Selling Agent. This Agreement shall not constitute you a partner
of the Managing General Partner, the Dealer-Manager, a Partnership, any
general partner of a Partnership, or any other Selling Agent, nor
render the Managing General Partner, the Dealer-Manager, the
Partnerships, any general partner of a Partnership, or any other
Selling Agent, liable for any of your obligations.
14. Effective Date. This Agreement is made effective between the parties as
of the date accepted by you as indicated by your signature to this
Agreement.
15. Entire Agreement, Waiver.
(a) This Agreement constitutes the entire agreement between the
Dealer-Manager and you, and shall not be amended or modified in
any way except by subsequent agreement executed in writing.
Neither party to this Agreement shall be liable or bound to the
other by any agreement except as specifically set forth in this
Agreement.
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(b) The Dealer-Manager and you may waive, but only in writing, any
term, condition, or requirement under this Agreement that is
intended for its benefit. However, any written waiver of any
term or condition of this Agreement shall not operate as a
waiver of any other breach of the term or condition of this
Agreement. Also, any failure to enforce any provision of this
Agreement shall not operate as a waiver of that provision or
any other provision of this Agreement.
16. Notices.
(a) Any communications from you shall be in writing addressed to the
Dealer-Manager at P.O. Box 926, Coraopolis, Pennsylvania
15108-0926.
(b) Any notice from the Dealer-Manager to you shall be deemed to have
been duly given if mailed, faxed or telegraphed to you at your
address shown below.
17. Complaints. The Dealer-Manager and you agree as follows:
(a) to notify the other if either receives an investor complaint in
connection with the offer or sale of Units by you;
(b) to cooperate with the other in resolving the complaint; and
(c) to cooperate in any regulatory examination of the other to the
extent it involves this Agreement or the offer or sale of Units
by you.
18. Privacy. The Dealer-Manager and you each acknowledge that certain
information made available to the other under this Agreement may be
deemed nonpublic personal information under the Gramm-Leach-Bliley Act,
other federal or state privacy laws (as amended), and the rules and
regulations promulgated thereunder, which are referred to collectively
as the "Privacy Laws." The Dealer-Manager and you agree as follows:
(a) not to disclose or use the information except as required to
carry out each party's respective duties under this Agreement or
as otherwise permitted by law in the ordinary course of business;
(b) to establish and maintain procedures reasonably designated to
assure the security and privacy of all the information; and
(c) to cooperate with the other and provide reasonable assistance in
ensuring compliance with the Privacy Laws to the extent
applicable to either or both the Dealer-Manager and you.
19. Anti-Money Laundering Provision. You represent and warrant to the
Managing General Partner and the Dealer-Manager that you have in place
and will maintain suitable and adequate "know your customer" policies
and procedures and that you shall comply with all applicable laws and
regulations regarding anti-money laundering activity and will provide
such documentation to the Managing General Partner and the Dealer-
Manager on written request.
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20. Acceptance. Please confirm your agreement to become a Selling Agent
under the terms and conditions set forth above by signing and returning
the enclosed duplicate copy of this Agreement to us at the address set
forth above.
Sincerely,
_______________________________, 2003 ANTHEM SECURITIES, INC.
Date
ATTEST:
_______________________________ By:_______________________________
(SEAL) Secretary Justin Atkinson, Vice President
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ACCEPTANCE:
We accept your invitation to become a Selling Agent under all the terms and
conditions stated in the above Agreement and confirm that all the statements set
forth in the above Agreement are true and correct. We hereby acknowledge receipt
of the Prospectuses and Sales Literature and a copy of the Dealer-Manager
Agreement referred to above.
_________________________, 2003 ___________________________________,
Date a(n)________________corporation,
ATTEST:
_________________________ By:_________________________________
(SEAL) Secretary ________________________, President
(Address)____________________________
_____________________________________
_____________________________________
Your CRD Number is___________________
Your Tax ID Number is________________
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APPENDIX I TO SELLING AGENT AGREEMENT
In partial consideration for the payment to you, as Selling Agent, by the
Dealer-Manager of up to a .5% reimbursement of your bona fide accountable
marketing expenses as set forth in Section 2(a) of the Selling Agent Agreement,
you warrant, represent, covenant, and agree with the Dealer-Manager that you, as
Selling Agent, shall do the following:
o prominently and promptly announce your participation in the
offering as Selling Agent to your registered representatives,
whether by newsletter, e-mail, mail or otherwise, which
announcement also shall advise your registered representatives
to contact our Regional Marketing Director in whose territory
the registered representative is located (the information
concerning our Regional Marketing Directors has been provided
to you by separate correspondence) with a copy of the
announcement provided concurrently to the Dealer-Manager; and
o provide the Dealer-Manager with the names, telephone numbers,
addresses and e-mail addresses of your registered
representatives, which information shall be kept confidential
by the Dealer-Manager and the Managing General Partner and
shall not be used for any purpose other than the marketing of
the offering as set forth in the Dealer-Manager Agreement and
the Selling Agent Agreement. Further, you, as Selling Agent,
agree that the Dealer-Manager and the Managing General Partner
may directly contact your registered representatives, in person
or otherwise, to:
o inform them of the offering;
o explain the merits and risks of the offering; and
o otherwise assist in your registered representatives'
efforts to solicit and sell Units.
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