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EXHIBIT 1.2
FORM OF SELECTED PLACEMENT AGENT (DEALER) AGREEMENT
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1,000,000 SHARES
HARP & EAGLE, LTD.
COMMON STOCK
SELECTED PLACEMENT AGENT AGREEMENT
, 2001
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Gentlemen:
J.E. Liss & Company, Inc. is acting as underwriter ("Managing Placement
Agent"), on a "best efforts" basis, of an offering by Harp & Eagle, Ltd., a
Wisconsin corporation ("Company"), of 1,000,000 shares of its common stock, par
value $0.0001 per share ("Common Stock"), at an initial public offering price
anticipated to range from $5.00 per share to $6.50 per share. The Company and
the Common Stock are more particularly described in the registration statement
of the Company on Form SB-2 ("Registration Statement"), relating to the
registration of the Common Stock under the Securities Act of 1933, as amended
("Securities Act"), including the enclosed prospectus relating to the offering
("Prospectus"), additional copies of which will be supplied in reasonable
quantities upon your request.
We have entered into an agreement with the Company ("Managing Placement
Agent Agreement"), pursuant to which we have been authorized to select and
manage a group of dealers (including ourselves), among whom we are pleased to
include you, who will have the right, and will agree to use their best efforts,
to solicit subscriptions for Common Stock, on the terms and conditions stated
herein and in the Prospectus.
1. Offering to Certain Dealers.
We are offering the right to solicit subscriptions for Common Stock to
certain dealers ("Selected Placement Agents") who are members of the National
Association of Securities Dealers, Inc. ("NASD") and who agree to comply with
Rule 2740 of the NASD Conduct Rules, or, if a foreign dealer, who will when
procuring subscribers in the United States, conform to such Rules, and if not
eligible for membership in the NASD, agree when soliciting subscriptions for
Common Stock outside the United States not to make sales to United States
citizens, and, in connection with sales of Common Stock, to comply with the NASD
Interpretive Material with respect to "Free-Riding and Withholding" (IM-2110-1)
and Rules 2730, 2740, 2420 and 2750 of the NASD Conduct Rules.
No Selected Placement Agent may reallow commissions to any non-member
broker-dealers, including foreign broker-dealers registered under the Securities
Exchange Act of 1934, as amended ("Exchange Act"). The right to solicit
subscriptions for Common Stock is subject to the terms set forth herein and in
the Prospectus and is several, not joint.
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2. Terms of Offering.
In accordance with the terms and conditions set forth in the
Prospectus, the Common Stock is anticipated to be offered at an initial public
offering price ranging from $5.00 per share to $6.50 per share; the minimum
subscription is 100 shares of Common Stock, unless the Company otherwise agrees
in writing.
Funds tendered by subscribers for Common Stock will be held in escrow
by Grafton State Bank, Grafton, Wisconsin ("Escrow Agent"), pursuant to an
agreement among the Company, the Escrow Agent and us ("Escrow Agreement"). In
the event that at least 60,000 shares of Common Stock have not been sold within
120 days from the initial effective date of the Registration Statement under the
Securities Act ("Termination Date"), the offering will terminate, and no Common
Stock will be sold, in which event no commissions or expense allowance shall be
payable to you (or to any other Selected Placement Agent, including us), and
funds received from subscribers will be promptly returned directly to them in
full by the Escrow Agent, without interest thereon or deduction therefrom, as
provided in the Escrow Agreement. Provided that at least 60,000 shares of Common
Stock are sold on or before the Termination Date, the Selected Placement Agents
may continue to offer the Common Stock for sale until (i) 1,000,000 shares are
sold or (ii) December 31, 2001, whichever first occurs; the Offering may be
terminated at any time prior thereto at the discretion of the Company. In the
event that the offering is otherwise terminated prior to the initial
disbursement of subscription proceeds by the Escrow Agent ("Closing"), no
commissions or expense allowance shall be payable to you (or to any other
Placement Agent, including us), and funds received from subscribers will be
promptly returned directly to them in full by the Escrow Agent, without interest
thereon or deduction therefrom.
If you agree to participate in the solicitation of subscriptions for
Common Stock, you should advise us by telephone or telegraph at our office (at
the address specified in paragraph 9 hereof) of the number of shares of Common
Stock for which you wish to procure subscriptions. You agree to advise us from
time to time, upon request, of the number of subscriptions procured by you.
Acceptance or rejection of subscriptions procured by you will be confirmed,
subject to the terms and conditions set forth herein and in the Prospectus. We
shall have full authority to take such action as we may deem advisable with
respect to all matters pertaining to the public offering of the Common Stock.
3. Compensation of Selected Placement Agent.
We will reallow to you, as a Selected Placement Agent, commissions and
a nonaccountable expense allowance in amounts equal to % and %, respectively, of
the aggregate purchase price of Common Stock for which you have procured
subscriptions which are accepted by the Company. No commissions or expense
allowance will be paid (i) in the case of any subscription which is rejected,
(ii) if at least 60,000 shares of Common Stock are not sold within the period
provided therefor (as described herein and in the Prospectus), or (iii) in the
case of any subscription which we determine was solicited in violation of
applicable securities laws or the rules of the NASD. In the event of any dispute
as to whether a particular subscription was procured by you, the designation of
the Selected Placement Agent appearing on the related Subscription Agreement
shall be determinative; if no designation appears on a Subscription Agreement,
the subscription shall be deemed to have been procured by the Managing Placement
Agent. The full amount of any commissions and expense allowance to which you are
then entitled shall be paid to you by us promptly following each Closing (as
defined herein and in the Managing Placement Agent Agreement).
4. Subscription Procedure. In order for a subscription to be
considered, the prospective investor must:
(a) complete, execute and deliver to the Company a Subscription
Agreement in the form included as Exhibit A to the Prospectus; and
(b) tender payment (checks must be payable to "Grafton State Bank,
Escrow Agent,") in an amount equal to the full purchase price of
the Common Stock subscribed for, which payment must be delivered
to the Escrow Agent, by 12:00, noon, on the business day next
following receipt thereof by any Selected Placement Agent.
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5. Position of Managing Placement Agent and Selected Placement Agents.
We have been advised by the Company that the Registration Statement has
become effective. You, as a Selected Placement Agent soliciting subscriptions
for Common Stock pursuant hereto, agree (which agreement shall also be for the
benefit of the Company) that you will (i) comply with all applicable provisions
of the Securities Act, the Exchange Act and applicable state securities or "blue
sky" laws (including, in each case, all rules and regulations promulgated under
such federal and state statutes), and the Conduct Rules of the NASD, (ii)
prepare and maintain, for your benefit and the benefit of the Company, file
memoranda and other appropriate records substantiating the foregoing and shall
retain such records for the period required under Exchange Act Rule 17a-4 or the
laws of any state in which you offer the Common Stock for sale, whichever is
longer; and (iii) not make sales of Common Stock to discretionary accounts.
In connection with the offer and sale of Common Stock, no person is
authorized to give any information or make any representation not contained in
the Prospectus, or to distribute to any potential investor or to the public
generally any sales, promotional or advertising material which has not been
previously authorized in writing by us. Nothing herein shall constitute the
Selected Placement Agents partners or associates of (or as having any like
relationship with) the Managing Placement Agent or one another. We shall be
under no liability to you, except as may be incurred under the Securities Act,
and except for obligations expressly assumed by us in this Agreement; no other
obligation on our part shall be implied or inferred herefrom.
6. Indemnification.
Under the Managing Placement Agent Agreement, the Company has agreed to
indemnify each of the Selected Placement Agents (including us) and each person,
if any, who controls a Selected Placement Agent within the meaning of the
Securities Act against certain liabilities, including liabilities arising under
such Act. Each Selected Placement Agent, by execution and delivery of this
Agreement, agrees to indemnify the Company and each person, if any, who controls
the Company, as provided in the Managing Placement Agent Agreement, and agrees
to indemnify the Managing Placement Agent and each other Selected Placement
Agent to the extent and in the manner such Selected Placement Agent agrees to
indemnify the Company in the Managing Placement Agent Agreement.
7. Blue Sky Matters.
We shall have no responsibility with respect to the right of any
Selected Placement Agent to solicit subscriptions for Common Stock in any
jurisdiction in which the Common Stock may be offered for sale, notwithstanding
any statements or information that may be made or furnished to you by any person
or entity in that connection.
8. Term of Agreement.
This Agreement shall terminate as of (i) the close of business on the
90th day following the date of the Prospectus, unless extended by us, in our
sole discretion, for successive 30-day periods, or (ii) the termination of the
offering, whichever first occurs. We may, in our sole discretion, terminate this
Agreement at any time. Notwithstanding the termination of this Agreement, you
shall remain liable to the extent provided by law for your proportionate amount
of any claim or demand (including resulting liability, if any) which may be made
against you alone, or against you together with other Selected Placement Agents
soliciting subscriptions for Common Stock under the terms hereof, or against us,
or either of us, based upon the assertion that the Selected Placement Agents or
any of them constitute an association, partnership, unincorporated business or
other separate entity.
9. Notices.
All communications to us should be addressed to J.E. Liss & Company,
Inc., 424 East Wisconsin Avenue, Milwaukee, Wisconsin 53202, Attention: Jerome
E. Liss. Any communication from us shall be addressed to you at the address
furnished in the confirmation hereof, and any notices from us to you shall be
deemed to have been authorized if sent by us and to have been duly given if
mailed or telegraphed to you at such address.
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10. Applicable Law.
This Agreement shall be governed by and construed in accordance with
the laws of the State of Wisconsin.
In the event that you agree to participate in the procurement of
subscriptions for Common Stock, please confirm such agreement by completing,
signing and returning to us the enclosed duplicate hereof.
Very truly yours,
J.E. Liss & Company, Inc.
By:
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Jerome E. Liss, President
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Jerome E. Liss
J.E. Liss & Company, Inc.
424 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Dear Sir:
We hereby confirm our agreement to procure subscribers, on a "best
efforts" basis, for the 1,000,000 shares of common stock ("Common Stock") to be
offered for sale by Harp & Eagle, Ltd., subject to the terms and conditions of
the foregoing Agreement. We acknowledge receipt of the Prospectus relating to
the Common Stock, and confirm that, in agreeing to procure subscribers for
Common Stock, we have relied upon no statements whatsoever, oral or written,
other than the statements in such Prospectus. We represent that we are a member
in good standing of the National Association of Securities Dealers, Inc.
("NASD") and agree to comply with the provisions of Rule 2740 of the NASD
Conduct Rules. If a foreign dealer, we agree, when procuring subscribers in the
United States, to in all respects conform to the NASD Conduct Rules, and, in
making sales of Common Stock, to comply with the NASD Interpretive Material with
respect to "Free-Riding and Withholding" (IM-2110-1) and Rules 2730, 2740, 2420
and 2750 of the NASD Conduct Rules.
Very truly yours,
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(Name of Firm)
By:
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(Name and Title)
Address to which all notices
may be mailed or telegraphed
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(Street Address)
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(City, State and Zip Code)
Dated:
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