EXHIBIT 1.01
FORM OF
AMENDED AND RESTATED
SELLING AGREEMENT
--------------------------
PROFUTURES BULL & BEAR FUND L.P.
(A Delaware Limited Partnership)
Units of Limited Partnership Interest
Dated as of ________, 1998
PROFUTURES BULL & BEAR FUND L.P.
AMENDED AND RESTATED
SELLING AGREEMENT
TABLE OF CONTENTS
Page
----
Section 1. Representations and Warranties of the General Partner............ 2
Section 2. Representations and Warranties of the Selling Agent.............. 6
Section 3. Representations and Warranties of the Trading Advisor........... 7
Section 4. Representations and Warranties of the Broker..................... 9
Section 5. Offering and Sale of Units....................................... 11
Section 6. Covenants of the General Partner................................. 15
Section 7. Covenants of the Trading Advisor................................. 16
Section 8. Covenants of the Broker.......................................... 17
Section 9. Payment of Expenses and Fees..................................... 17
Section 10. Conditions of Closing............................................ 18
Section 11. Indemnification and Exculpation.................................. 27
Section 12. Status of Parties................................................ 30
Section 13. Representations, Warranties and Agreements to Survive Delivery... 30
Section 14. Termination...................................................... 31
Section 15. Notices and Authority to Act..................................... 31
Section 16. Parties.......................................................... 32
Section 17. Governing Law.................................................... 32
Section 18. Requirements of Law.............................................. 32
PROFUTURES BULL & BEAR FUND L.P.
(A Delaware Limited Partnership)
$60,000,000 Units of Limited Partnership Interest
(Subscription Price: 101% of Net Asset Value per Unit)
FORM OF
AMENDED AND RESTATED
SELLING AGREEMENT
-------------------------
_______, 1998
PROFUTURES FINANCIAL GROUP, INC.
1310 Highway 620 South
Suite 200
Austin, Texas 78734
Dear Sirs:
Your affiliate, ProFutures, Inc., a Texas corporation (referred to
herein in its individual corporate capacity and as general partner as the
"General Partner"), and an initial limited partner have caused the formation of
a limited partnership pursuant to the Revised Uniform Limited Partnership Act of
the State of Delaware ("DRULPA") under the name ProFutures Bull & Bear Fund,
L.P. (the "Fund"), for the purpose of engaging in speculative trading of futures
and forward contracts and commodity options. As described in the Prospectus
referred to below, the Fund has entered into the First Amendment and Restatement
of Advisory Contract (the "Advisory Agreement") with Hampton Investors, Inc., a
New York corporation (the "Trading Advisor"). The Fund engages in speculative
trading in the commodities markets under the direction of the Trading Advisor
pursuant to its Leverage 3 Trading Program (the "Trading Strategy"). You shall
serve as lead selling agent for the Fund (herein referred to as the "Selling
Agent") and you may select, with the consent of the General Partner, other
selling agents (the "Additional Selling Agents") (including those introduced by
wholesalers ("Wholesalers")) to act as selling agents for the Fund in accordance
with the terms of the Additional Selling Agent Agreement attached hereto as
Exhibit A. In addition, the Additional Selling Agents may also, with the consent
of the Selling Agent and the General Partner, distribute Units through the use
of "introducing broker" Correspondents ("Correspondents").
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ING (U.S.) Securities, Futures & Option, Inc. (the "Broker") acts as
broker for the Fund pursuant to a customer agreement (the "Customer Agreement")
between the Broker and the Fund.
Capitalized terms used herein, unless otherwise indicated, shall have
the meanings attributed to them in the Prospectus referred to below.
Section 1. Representations and Warranties of the General Partner.
The General Partner represents and warrants to the Trading Advisor, the Broker
and the Selling Agent, as follows:
(a) The Fund has provided to the Trading Advisor and to the Selling
Agent and filed with the Securities and Exchange Commission (the "SEC") a
registration statement on Form S-1 (Registration No. 333-_____), as
initially filed with the SEC on ________, 1998 for the registration of
Units of Limited Partnership Interests (the "Units") in the Fund under the
Securities Act of 1933, as amended (the "1933 Act"), has filed two copies
thereof with the Commodity Futures Trading Commission (the "CFTC") under
the Commodity Exchange Act (the "Commodity Act") and one copy with the
National Futures Association (the "NFA") in accordance with NFA Compliance
Rule 2-13. The Registration Statement became effective with the SEC as of
the date hereof. (The Registration Statement, in the form in which it
became effective, and the Prospectus included therein as first filed
pursuant to Rule 424(b) of the rules and regulations of the SEC under the
1933 Act (the "SEC Regulations") are hereinafter referred to as the
"Registration Statement" and the "Prospectus," respectively.) If the Fund
files a subsequent post-effective amendment to the Registration Statement,
then the term Registration Statement shall, from and after the declaration
of the effectiveness of such post-effective amendment, refer to the
Registration Statement as amended by such post-effective amendment thereto,
and the term Prospectus shall refer to the amended prospectus then on file
with the SEC as part of the Registration Statement, or if a subsequent
prospectus is filed by the Fund pursuant to Rule 424 of the SEC
Regulations, the term Prospectus shall refer to the prospectus most
recently filed pursuant to such Rule from and after the date on which it
shall have been first used. Except as required by law, the Fund will not
file any amendment to the Registration Statement or any amendment or
supplement to the Prospectus which shall be reasonably objected to in
writing by the Trading Advisor or by counsel to the Trading Advisor, upon
reasonable prior notice.
(b) The Fund will not utilize any promotional brochure or other
marketing materials (collectively, "Promotional Material"), including
"Tombstone Ads" or other communications qualifying under Rule 134 of the
SEC Regulations, which are reasonably objected to by the Selling Agent. No
reference to the Selling Agent may be made in the Registration Statement,
Prospectus or in any Promotional Material which has not been approved in
writing by the Selling Agent, which approval the
2
Selling Agent may withhold in its sole and absolute discretion. The Fund
will file all Promotional Material with the National Association of
Securities Dealers, Inc. (the "NASD"), and will not use any such
Promotional Material to which the NASD has not stated in writing that it
has no objections. The Fund will file all Promotional Material in all state
jurisdictions where such filing is required, and will not use any such
Promotional Material in any state which has expressed any objection thereto
(except pursuant to agreed-upon modifications to the Promotional Material).
(c) The Certificate of Limited Partnership (the "Certificate of
Limited Partnership") pursuant to which the Fund has been formed and the
Second Amended and Restated Limited Partnership Agreement of the Fund (the
"Limited Partnership Agreement") each provides for the subscription for and
sale of the Units; all action required to be taken by the General Partner
and the Fund as a condition to the sale of the Units to qualified
subscribers therefor has been, or prior to the Initial Public Closing Time
and Subsequent Public Closing Times, as defined in Section 5 hereof, will
have been taken; and, upon payment of the consideration therefor specified
in all accepted Subscription Agreements and Powers of Attorney, the Units
will constitute valid limited partnership interests in the Fund.
(d) The Fund is a limited partnership duly organized pursuant to the
Certificate of Limited Partnership, the Limited Partnership Agreement and
the DRULPA and validly existing under the laws of the State of Delaware
with full power and authority to engage in the trading of futures, forward
and option contracts, as described in the Prospectus, and the Fund has
qualified to do business in the State of Texas.
(e) The General Partner is duly organized and validly existing and in
good standing as a corporation under the laws of the State of Texas and in
good standing as a foreign corporation in any other jurisdiction in which
the nature or conduct of its business requires such qualification and the
failure to so qualify would materially adversely affect the Fund or the
General Partner's ability to perform its obligations hereunder.
(f) The Fund and the General Partner have partnership or corporate
power and authority under applicable law to perform their respective
obligations under the Limited Partnership Agreement, the Customer
Agreement, the Investment Advisory Agreement, the Additional Selling
Agents Agreement, the Advisory Agreement and this Agreement, as described
in the Registration Statement and Prospectus.
(g) The Registration Statement and Prospectus contain all statements
and information required to be included therein by the Commodity Act and
the rules and regulations thereunder. When the Registration Statement
became effective under the 1933 Act and at all times subsequent thereto up
to and including the Initial Public Closing Time, the Registration
Statement and Prospectus will comply in all material
3
respects with the requirements of the 1933 Act, the Commodity Act and the
rules and regulations under such Acts. The Registration Statement as of its
effective date did not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading. The Prospectus as of its date
of issue and at the Initial Public Closing Time did not and will not
contain an untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of the
circumstances under which such statements were made, not misleading. This
representation and warranty shall not, however, apply to any statement or
omission in the Registration Statement or Prospectus made in reliance upon
and in conformity with information relating to the Trading Advisor, the
Broker or the Cash Manager and furnished or approved in writing by the
Trading Advisor, the Broker or the Cash Manager.
(h) Arthur F. Bell, Jr. & Associates, L.L.C., the accountants who
certified the financial statements filed with the SEC as part of the
Registration Statement, are, with respect to the General Partner and the
Fund, independent public accountants with respect to the General Partner
and the Fund as required by the 1933 Act and the SEC Regulations.
(i) The financial statements filed as part of the Registration
Statement and those included in the Prospectus present fairly the financial
position of the Fund and of the General Partner as of the dates indicated;
and said financial statements have been prepared in conformity with
generally accepted accounting principles (as described therein), or, in the
case of unaudited financial statements, in substantial conformity with
generally accepted accounting principles, applied on a basis which is
consistent in all material respects for each balance sheet date presented.
(j) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, there has not been any
material adverse change in the condition, financial or otherwise, business
or prospects of the General Partner or the Fund, whether or not arising in
the ordinary course of business.
(k) The General Partner at the Initial Public Closing Time and each
Subsequent Public Closing Time will have a net worth sufficient in amount
and satisfactory in form, as set forth in the opinion of Sidley & Austin,
counsel for the General Partner, for classification of the Fund as a
partnership for Federal income tax purposes under current interpretations
of the Internal Revenue Code of 1986, as amended (the "Code"), and the
regulations thereunder.
(l) The Advisory Agreement, the Limited Partnership Agreement, the
Additional Selling Agents Agreement and this Agreement have each been duly
and validly authorized, executed and delivered by the General Partner for
itself and on behalf of the Fund, and each constitutes a legal, valid and
binding agreement of the Fund and the General Partner enforceable in
accordance with its terms. The
4
Investment Advisory Agreement and the Customer Agreement have both been
duly and validly authorized, executed and delivered by the General Partner
on behalf of the Fund.
(m) The execution and delivery of the Limited Partnership Agreement,
the Customer Agreement, the Investment Advisory Agreement, the Additional
Selling Agents Agreement, the Advisory Agreement and this Agreement, the
incurrence of the obligations set forth in each of such agreements and the
consummation of the transactions contemplated therein and in the Prospectus
will not constitute a breach of, or default under, any instrument by which
either the General Partner or the Fund, as the case may be, is bound or any
order, rule or regulation applicable to the General Partner or the Fund of
any court or any governmental body or administrative agency having
jurisdiction over the General Partner or the Fund.
(n) There is not pending, or, to the best of the General Partner's
knowledge threatened, any action, suit or proceeding before or by any court
or other governmental body to which the General Partner or the Fund is a
party, or to which any of the assets of the General Partner or the Fund is
subject, which is not referred to in the Prospectus and which might
reasonably be expected to result in any material adverse change in the
condition (financial or otherwise), business or prospects of the General
Partner or the Fund or is required to be disclosed in the Prospectus
pursuant to applicable CFTC regulations. The General Partner has not
received any notice of an investigation or warning letter from the NFA or
the CFTC regarding non-compliance by the General Partner with the Commodity
Act or the regulations thereunder.
(o) The General Partner has all Federal and state governmental,
regulatory and commodity exchange approvals and licenses, and has effected
all filings and registrations with Federal and state governmental agencies
required to conduct its business and to act as described in the
Registration Statement and Prospectus or required to perform its
obligations as described under the Limited Partnership Agreement and this
Agreement (including, without limitation, registration as a commodity pool
operator under the Commodity Act and membership in the NFA as a commodity
pool operator), and the performance of such obligations will not con
travene or result in a breach of any provision of its certificate of
incorporation, by-laws or any agreement, order, law or regulation binding
upon it. The principals of the General Partner identified in the
Registration Statement are all of the principals of the General Partner, as
"principals" is defined by the CFTC regulations. Such principals are duly
registered as such on the General Partner's commodity pool operator Form
7-R registration.
(p) The Fund does not require any Federal or state governmental,
regulatory or commodity exchange approvals or licenses, or need to effect
any filings or registrations with any Federal or state governmental
agencies in order to conduct its businesses and to act as contemplated by
the Registration Statement and Prospectus
5
and to issue and sell the Units (other than filings relating solely to the
offering of the Units), and to trade in the commodity markets.
(q) None of the General Partner or any principal or affiliate thereof
has "operated," since January 1, 1991, any commodity pool, within the
meaning of the CFTC's Part 4 Regulations, the performance of which is not
included in the Prospectus.
Section 2. Representations and Warranties of the Selling Agent. The
Selling Agent represents and warrants to the Fund, the General Partner, the
Trading Advisor and the Broker as follows:
(a) The Selling Agent is a corporation duly organized and validly
existing and in good standing under the laws of the State of Texas and in
good standing and qualified to do business in each jurisdiction in which
the nature or conduct of its business requires such qualification and the
failure to be duly qualified would materially adversely affect the Selling
Agent's ability to perform its obligations hereunder. The Selling Agent has
full corporate power and authority to perform its obligations under this
Agreement and as described in the Registration Statement and Prospectus.
(b) All references to the Selling Agent and its principals in the
Registration Statement and Prospectus are accurate and complete in all
material respects, and set forth in all material respects the information
required to be disclosed therein under the Commodity Act and the rules and
regulations thereunder. As to the Selling Agent and its principals, (i) the
Registration Statement and Prospectus contain all statements and
information required to be included therein under the Commodity Act and the
rules and regulations thereunder, (ii) the Registration Statement as of its
effective date did not contain any misleading or untrue statement of a
material fact or omit to state a material fact which is required to be
stated therein or necessary to make the statements therein not misleading
and (iii) the Prospectus at its date of issue and as of the Initial Public
Closing Time did not and will not contain an untrue statement of a material
fact or omit to state a material fact necessary to make the statements
therein not misleading, in light of the circumstances under which such
statements were made.
(c) The Selling Agent has all Federal and state governmental,
regulatory and commodity exchange licenses and approvals, and has effected
all filings and registrations with Federal and state governmental and
regulatory agencies required to conduct its business and to act as
described in the Registration Statement and Prospectus or required to
perform its obligations under this Agreement, and the performance of such
obligations will not violate or result in a breach of any provision of the
Selling Agent's certificate of incorporation, by-laws or any agreement,
instrument, order, law or regulation binding upon the Selling Agent.
6
(d) This Agreement has been duly authorized, executed and delivered
by the Selling Agent and constitutes a valid, binding and enforceable
agreement of the Selling Agent in accordance with its terms.
(e) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as may otherwise be
stated in or contemplated by the Registration Statement and the Prospectus,
there has not been any material adverse change in the condition, financial
or otherwise, business or prospects of the Selling Agent, whether or not
arising in the ordinary course of business.
(f) In the ordinary course of its business, the Selling Agent may be
engaged in civil litigation and subject to administrative proceedings.
Neither the Selling Agent nor any of its principals have been the subject
of any administrative, civil, or criminal actions within the five years
preceding the date hereof that would be material to an investor's decision
to purchase the Units which are not disclosed in the Prospectus.
(g) The execution and delivery of this Agreement, the incurrence of
the obligations set forth herein and the consummation of the transactions
contemplated herein and in the Prospectus will not constitute a breach of,
or default under, any instrument by which the Selling Agent is bound or any
order, rule or regulation applicable to the Selling Agent of any court or
any governmental body or administrative agency having jurisdiction over
the Selling Agent.
Section 3. Representations and Warranties of the Trading Advisor. The
Trading Advisor represents and warrants to the Fund, the Selling Agent, the
Broker and the General Partner as follows:
(a) The Trading Advisor is a corporation duly organized and validly
existing and in good standing under the laws of the State of New York and
in good standing as a foreign corporation in each other jurisdiction in
which the nature or conduct of its business requires such qualification and
the failure to be duly qualified would materially affect the Trading
Advisor's ability to perform its obligations under this Agreement and the
Advisory Agreement. The Trading Advisor has full corporate power and
authority to perform its obligations under this Agreement and the Advisory
Agreement as described in the Registration Statement and Prospectus.
(b) All references to the Trading Advisor and its principals, and its
trading systems, methods and performance in the Registration Statement and
the Prospectus are accurate and complete in all material respects. As to
the Trading Advisor, each of the principals of the Trading Advisor, the
Trading Strategy and the Trading Advisor's trading systems, strategies and
performance, (i) the Registration Statement and Prospectus contain all
statements and information required to be included therein under the
Commodity Act and the rules and regulations thereunder, (ii) the
Registration Statement (with respect to the information relating to the
Trading
7
Advisor as of its effective date did not contain any misleading or untrue
statement of a material fact or omit to state a material fact which is
required to be stated therein or necessary to make the statements therein
not misleading and (iii) the Prospectus (with respect to information
relating to the Trading Advisor) at its date of issue and as of the Initial
Public Closing Time, as supplemented, did not and will not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein not misleading, in light of the
circumstances under which such statements were made. Except as otherwise
disclosed in the Prospectus or identified in writing to the General Partner
on or prior to the date hereto, the actual performance of each
discretionary account directed by the Trading Advisor or any principal or
affiliate of the Trading Advisor for the periods covered by the performance
summaries set forth in the Prospectus is disclosed in accordance with the
requirements of the Commodity Act and the rules and regulations thereunder
(or as otherwise permitted by the Staff of the Division of Trading and
Markets). The information, performance summaries and monthly rates of
return relating to the performance of the Trading Advisor comply in all
material respects with the disclosure requirements of the rules and
regulations of the CFTC under the Commodity Act. The performance summaries
in the Prospectus (as applicable to the Trading Advisor) have been
calculated in the manner set forth in the notes thereto.
(c) The Advisory Agreement and this Agreement have each been duly and
validly authorized, executed and delivered on behalf of the Trading Advisor
and both constitute valid, binding and enforceable agreements of the
Trading Advisor in accordance with their terms.
(d) The Trading Advisor has all Federal and state governmental,
regulatory and commodity exchange licenses and approvals and has effected
all filings and registrations with Federal and state governmental and
regulatory agencies required to conduct its business and to act as
described in the Registration Statement and Prospectus or required to
perform its obligations under this Agreement and the Advisory Agreement
(including, without limitation, registration of the Trading Advisor as a
commodity trading advisor under the Commodity Act and membership of the
Trading Advisor as a commodity trading advisor in the NFA), and the
performance of such obligations will not violate or result in a breach of
any provision of the Trading Advisor's Certificate of Incorporation, By-
laws or any agreement, instrument, order, law or regulation binding on the
Trading Advisor. The principals of the Trading Advisor are duly listed as
such on the Trading Advisor's commodity trading advisor Form 7-R
registration.
(e) Management by the Trading Advisor of an account for the Fund in
accordance with the terms hereof and of the Advisory Agreement, and as
described in the Prospectus, will not require any registration under, or
violate any of the provisions of, the Investment Advisers Act of 1940.
8
(f) Neither the Trading Advisor nor any principal of the Trading
Advisor will use or distribute any preliminary prospectus, Prospectus,
amended or supplemented Prospectus or selling literature nor engage in any
selling activities whatsoever in connection with the offering of the Units.
(g) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as may otherwise be
stated in or contemplated by the Registration Statement and the Prospectus,
there has not been any material adverse change in the condition, financial
or otherwise, business or prospects of the Trading Advisor, whether or not
arising in the ordinary course of business.
(h) The execution and delivery of this Agreement and the Advisory
Agreement, the incurrence of the obligations herein and therein set forth
and the consummation of the transactions contemplated herein and therein
and in the Prospectus will not constitute a breach of, or default under,
any instrument by which the Trading Advisor is bound or any order, rule or
regulation applicable to the Trading Advisor of any court or any
governmental body or administrative agency having jurisdiction over the
Trading Advisor.
(i) There is not pending, or to the best of the Trading Advisor's
knowledge threatened, any action, suit or proceeding before or by any court
or other govern mental body to which the Trading Advisor is a party, or to
which any of the assets of the Trading Advisor is subject, which might
reasonably be expected to result in any material adverse change in the
condition, financial or otherwise, business or prospects of the Trading
Advisor. The Trading Advisor has not received any notice of an
investigation or warning letter from the NFA or the CFTC regarding non-
compliance by the Trading Advisor with the Commodity Act or the regulations
thereunder.
(j) The Trading Advisor has not received, and is not entitled to
receive, directly or indirectly, any commission, finder's fee, similar fee
or rebate from any person in connection with the organization or operation
of the Fund.
Section 4. Representations and Warranties of the Broker. The Broker
represents and warrants to the Fund, the General Partner, the Trading Advisor
and the Selling Agent, as follows:
(a) The Broker is a corporation duly organized and validly existing
and in good standing under the laws of the State of Illinois and in good
standing and qualified to do business in each jurisdiction in which the
nature or conduct of its business requires such qualification and the
failure to be duly qualified would materially adversely affect the Broker's
ability to perform its obligations hereunder or under the Customer
Agreement. The Broker has full corporate power and authority to perform its
obligations under the Customer Agreement and this Agreement and as
described in the Registration Statement and Prospectus.
9
(b) All references to the Broker and its principals in the
Registration Statement and Prospectus are accurate and complete in all
material respects, and set forth in all material respects the information
required to be disclosed therein under the Commodity Act and the rules and
regulations thereunder. As to the Broker and its principals, (i) the
Registration Statement and Prospectus contain all statements and
information required to be included therein under the Commodity Act and the
rules and regulations thereunder, (ii) the Registration Statement as of its
effective date did not contain any misleading or untrue statement of a
material fact or omit to state a material fact which is required to be
stated therein or necessary to make the statements therein not misleading
and (iii) the Prospectus at its date of issue and as of the Initial Public
Closing Time did not and will not contain an untrue statement of a material
fact or omit to state a material fact necessary to make the statements
therein not misleading, in light of the circumstances under which such
statements were made.
(c) The Broker has all Federal and state governmental, regulatory and
commodity exchange licenses and approvals, and has effected all filings and
registrations with Federal and state governmental and regulatory agencies
required to conduct its business and to act as described in the
Registration Statement and Prospectus or required to perform its
obligations under the Customer Agreement and this Agreement (including,
without limitation, registration of the Broker as a futures commission
merchant under the Commodity Act and membership of the Broker as a futures
commission merchant in the NFA), and the performance of such obligations
will not violate or result in a breach of any provision of the Broker's
certificate of incorporation, by-laws or any agreement, instrument, order,
law or regulation binding upon the Broker.
(d) This Agreement and the Customer Agreement have been duly
authorized, executed and delivered by the Broker, and constitute valid,
binding and enforceable agreements of the Broker in accordance with their
terms.
(e) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as may otherwise be
stated in or contemplated by the Registration Statement and the Prospectus,
there has not been any material adverse change in the condition, financial
or otherwise, business or prospects of the Broker, whether or not arising
in the ordinary course of business.
(f) In the ordinary course of its business, the Broker is engaged in
civil litigation and subject to administrative proceedings. Neither the
Broker nor any of its principals have been the subject of any
administrative, civil, or criminal actions within the five years preceding
the date hereof that would be material to an investor's decision to
purchase the Units which are not disclosed in the Prospectus.
(g) The execution and delivery of the Customer Agreement and this
Agreement, the incurrence of the obligations set forth herein and therein
and the con-
10
summation of the transactions contemplated herein and therein and in the
Prospectus will not constitute a breach of, or default under, any
instrument by which the Broker is bound or any order, rule or regulation
applicable to the Broker of any court or any governmental body or
administrative agency having jurisdiction over the Broker.
Section 5. Offering and Sale of Units.
(a) The Selling Agent is hereby appointed the principal selling agent
of the Fund (although as described herein it is contemplated that certain
Additional Selling Agents (including those introduced to the Selling Agent
by Wholesalers), Wholesalers and Correspondents may also market Units
provided each of such Additional Selling Agents, Wholesalers and
Correspondents is duly registered as a broker-dealer in each jurisdiction
in which such person markets Units) during the term herein specified for
the purpose of finding acceptable subscribers for the Fund through a public
offering. The Initial Public Offering Period shall continue until the first
full month after the Registration Statement has been declared effective
(the "Initial Public Offering Period"; such date being hereafter referred
to as the "Initial Public Offering Termination Date"). Thereafter, Units
may be sold as of the beginning of each month, as determined by the General
Partner (the "Ongoing Public Offering Period"; such subsequent sale dates
being hereinafter referred to as "Subsequent Public Closing Times"). The
Initial Public Offering Period and the Ongoing Public Offering Period shall
be referred to herein as the "Public Offering Period." Subject to the
performance by the General Partner of all its obligations to be performed
hereunder, and to the completeness and accuracy in all material respects of
all the representations and warranties of the General Partner, the Broker
and the Trading Advisor contained herein, the Selling Agent hereby accepts
such agency and agrees on the terms and conditions herein set forth to use
its best efforts during the Public Offering Period to find acceptable
subscribers for the Units at a public offering price of 101% of Net Asset
Value (including the 1% organizational charge referred to below), each
subscriber being required to make a minimum subscription of at least
$10,000, except for (i) trustees or custodians of eligible tax-exempt
accounts and individual retirement accounts and (ii) Limited Partners
subscribing for additional Units, where the minimum subscription is $5,000.
It is understood that the Selling Agent's agreement to use its best efforts
to find acceptable subscribers for the Units shall not prevent it from
acting as a selling agent or underwriter for the securities of other
issuers which may be offered or sold during the Public Offering Period.
(b) At the Initial Public Offering Closing Time the General Partner
shall notify the Selling Agent of the aggregate number of Units for which
the General Partner has received acceptable subscriptions and payment of
the purchase price for the Units may, if the General Partner so elects, be
made at the office of ProFutures, Inc., 11612 Bee Cave Road, Suite 100,
Austin, Texas 78733, or at such other place as shall be agreed upon between
the Selling Agent and the General Partner, at 10:00 A.M., Texas time, on
the fifth full business day after the day on which the General Partner
notifies the Selling Agent of the number of Units for which subscriptions
have been
11
accepted or such other day and time as shall be agreed upon between the
Selling Agent and the General Partner (the "Initial Public Closing Time").
(c) An organizational charge of 1% of the subscription amount will be
paid to the General Partner by each subscriber. The General Partner has
paid all actual costs of organizing the Fund and conducting the public
offering of the Units. To the extent that the aggregate 1% organizational
charge is less than the actual costs, the General Partner will pay the
costs. To the extent that the aggregate 1% organizational charge collected
exceeds the actual costs, the excess amount will be paid to the Selling
Agent. Such payment could be deemed to be a selling commission. The
Additional Selling Agents, if any, shall be compensated as set forth in the
Additional Selling Agents Agreement attached hereto as Exhibit A.
(d) The Selling Agent will compensate its own Registered
Representatives pursuant to the Selling Agent's standard compensation
procedures. The Selling Agent will pay Additional Selling Agents selling
commissions of up to 3% of the Net Asset Value of each Unit sold by the
Registered Representative of each such Additional Selling Agent. In the
case of an Additional Selling Agent introduced by a Wholesaler, the Selling
Agent will pay such Wholesaler a portion of the up to 3% per Unit selling
commissions depending upon the Wholesaler's arrangements with the
Additional Selling Agent. Ongoing compensation, of up to __% per annum of
the month-end Net Asset Value of the Units attributable to Units sold by a
Registered Representative of the Additional Selling Agent which remain
outstanding for more than twelve months (including the month as of the end
of which such Units is redeemed) will also be paid to each such Registered
Representative who agrees to provide the additional services described
below, who is registered with the CFTC and who has satisfied all applicable
proficiency requirements (including those imposed by the NASD as a
condition of receiving "trailing commissions") by either passing the Series
3 National Commodity Futures Exam or the Series 31 exam or being
"grandfathered" from having to do so. In the case of an Additional Selling
Agent introduced by a Wholesaler who meets the eligibility requirements for
receipt of ongoing compensation, the Selling Agent will pay a portion of
the up to __% monthly ongoing compensation to the Wholesaler
depending upon the Wholesaler's arrangement with the Additional Selling
Agent. For purposes of determining when "trailing commissions" should begin
to accrue, Units sold during the Initial Offering Period shall not be
deemed to be outstanding until the Initial Closing Time.
The ongoing compensation described in the foregoing paragraph shall
only be paid to any otherwise eligible Registered Representatives, provided
that the Additional Selling Agent with which such Registered Representative
is associated continues to be registered with the CFTC as a futures
commission merchant or introducing broker and continues to be a member in
good standing of NFA in such capacity, and is contingent upon the provision
by a Registered Representative (duly registered and qualified as to
proficiency with the CFTC and NFA as described above) who sold outstanding
Units in his capacity as a registered representative of an
12
Additional Selling Agent of additional services in connection with such
Units, including: (i) inquiring of the General Partner from time to time,
at the request of a Limited Partner, as to the Net Asset Value of a Unit;
(ii) inquiring of the General Partner from time to time, at the request of
a Limited Partner, regarding the commodities markets and the Fund; (iii)
assisting, at the request of the General Partner, in the redemption of
Units sold by such Registered Representative; and (iv) providing such
services to the Limited Partners as the General Partner, from time to time,
reasonably request.
Ongoing compensation shall be credited and paid only in respect of
Units sold by Registered Representatives who are eligible to receive such
ongoing compensation as described above. No ongoing compensation whatsoever
shall be credited, paid or accrued on any Units sold by Registered
Representatives not then eligible to receive such ongoing compensation.
With respect to particular Units substitute Registered Representatives who
are appropriately registered and who agree in writing to perform the
services described in this Section 5(d) above with respect to such Units
("Substitute Registered Representatives") may also receive ongoing
compensation with respect to such Units. Such ongoing compensation shall be
paid monthly.
In the event that the payment of ongoing compensation is restricted by
the NASD, the Selling Agent's payments of such ongoing compensation shall
be limited to the maximum amount permissible pursuant to such restrictions.
In the case of Units sold by Registered Representatives who are not
qualified to receive ongoing compensation as set forth above, the Selling
Agent will pay such Registered Representatives installment selling
commissions at the same rate as in the case of ongoing compensation, but
the sum of such installment selling commissions and the initial selling
commission payable to each such Registered Representative is limited in
amount, pursuant to applicable NASD policy, to 9.5% of the initial
subscription price of the Units sold by such Registered Representatives and
remaining outstanding.
In respect of Correspondents selected by an Additional Selling Agent
(with the consent of the General Partner and the Selling Agent), the
Selling Agent shall pay such Additional Selling Agent selling commissions
and ongoing compensation or installment sales commissions as set forth
above, a portion (as agreed between such Additional Selling Agent and each
such Correspondent) of which shall be passed on by the Additional Selling
Agent to such Correspondents.
Ongoing compensation which cannot be paid because an Additional
Selling Agent or a Correspondent (or a Registered Representative of either)
has not met the eligibility requirements shall be retained by the Selling
Agent.
(e) The Selling Agent will use its best efforts to find eligible
persons to purchase the Units on the terms stated herein and in the
Registration Statement and
13
Prospectus. It is understood that the Selling Agent has no commitment with
regard to the sale of the Units other than to use its best efforts. In
connection with the offer and sale of the Units, the Selling Agent
represents that it will comply fully with all applicable laws, and the
rules of the NASD, the SEC, the CFTC, state securities administrators and
any other regulatory body. In particular, and not by way of limitation, the
Selling Agent represents and warrants that it is aware of Rule 2810 of the
NASD (formerly Appendix F of the NASD Rules of Fair Practice) and that it
will comply fully with all the terms thereof in connection with the
offering and sale of the Units. The Selling Agent shall not execute any
sales of Units from a discretionary account over which it has control
without prior written approval of the customer in whose name such
discretionary account is maintained.
The Selling Agent agrees not to recommend the purchase of Units to any
subscriber unless the Selling Agent shall have reasonable grounds to
believe, on the basis of information obtained from the subscriber
concerning, among other things, the subscriber's investment objectives,
other investments, financial situation and needs, that the subscriber is or
will be in a financial position appropriate to enable the subscriber to
realize to a significant extent the benefits of the Fund, including tax
benefits described in the Prospectus; the subscriber has a fair market net
worth sufficient to sustain the risks inherent in participating in the
Fund, including loss of investment and lack of liquidity; and the Units are
otherwise a suitable investment for the subscriber. The Selling Agent
agrees to maintain files of information disclosing the basis upon which the
Selling Agent determined that the suitability requirements of Section
(b)(2) of Rule 2810 of the NASD were met as to each subscriber (the basis
for determining suitability may include the Subscription Agreements and
Powers of Attorney and other certificates submitted by subscribers). The
Selling Agent represents and warrants that it has reasonable grounds to
believe, based on information in the Prospectus and information to which
the Selling Agent has had access due to its affiliation with the General
Partner, that all material facts relating to an investment in the Units are
adequately and accurately disclosed in the Prospectus. In connection with
making the foregoing representations and warranties, the Selling Agent
further represents and warrants that it has, among other things, examined
the Prospectus and obtained such additional information from the General
Partner and the Trading Advisor regarding the information set forth
thereunder as the Selling Agent has deemed necessary or appropriate to
determine whether the Prospectus adequately and accurately discloses all
material facts relating to an investment in the Fund and provides an
adequate basis to subscribers for evaluating an investment in the Units. In
connection with making the representations and warranties set forth in this
paragraph, the Selling Agent has not relied on inquiries made by or on
behalf of any other parties.
The Selling Agent agrees to inform all prospective purchasers of Units
of all pertinent facts relating to the liquidity and marketability of the
Units as set forth in the Prospectus.
14
(f) None of the Selling Agent, the Fund or the General Partner shall,
directly or indirectly, pay or award any finder's fees, commissions or
other compensation to any person engaged by a potential investor for
investment advice as an inducement to such advisor to advise the purchase
of Units; provided, however, the normal sales commissions payable to a
registered broker-dealer or other properly licensed person for selling
Units shall not be prohibited hereby.
(g) All payments for subscriptions shall be made by deposit of check
or transfer of funds to the custodial account of the Fund as described in
the Prospectus.
(h) The General Partner agrees to cause its counsel to prepare and
deliver to the Selling Agent a Blue Sky Survey which shall set forth, for
the guidance of the Selling Agent, in which United States jurisdictions the
Units may be offered and sold. It is understood and agreed that the Selling
Agent may rely, in connection with the offering and sale of Units in any
jurisdiction, on advice given by such counsel as to the legality of the
offer or sale of the Units in such jurisdiction, provided, however, that
the Selling Agent shall be responsible for compliance with all applicable
laws, rules and regulations with respect to the actions of its employees,
acting as such, in connection with sales of Units in any jurisdiction.
Section 6. Covenants of the General Partner.
(a) The General Partner will notify the Selling Agent, the Broker and
the Trading Advisor immediately and confirm such notification in writing
(i) when any amendment to the Registration Statement shall have become
effective, (ii) of the receipt of any comments from the SEC, CFTC or any
other Federal or state regulatory body with respect to the Registration
Statement, (iii) of any request by the SEC, CFTC or any other Federal or
state regulatory body for any amendment to the Registration Statement or
any amendment or supplement to the Prospectus or for additional information
relating thereto and (iv) of the issuance by the SEC, CFTC or any other
Federal or state regulatory body of any order suspending the effectiveness
of the Registration Statement under the 1933 Act, the CFTC registration or
NFA membership of the General Partner as a commodity pool operator, or the
registration of Units under the Blue Sky or securities laws of any state or
other jurisdiction or any order or decree enjoining the offering or the use
of the then current Prospectus or of the institution, or notice of the
intended institution, of any action or proceeding for that purpose.
(b) The General Partner will deliver to the Selling Agent, as soon as
available, a conformed copy of each amendment to the Registration Statement
as originally filed including the Exhibits thereto, and will also deliver
to the Selling Agent such additional number of conformed copies of the
Registration Statement as originally filed and of each amendment thereto
(including Exhibits) as the Selling Agent shall reasonably require.
15
(c) The General Partner will deliver to the Selling Agent as promptly
as practicable from time to time during the period when the Prospectus is
required to be delivered under the 1933 Act, such number of copies of the
Prospectus (as amended or supplemented) as the Selling Agent, Wholesalers,
Additional Selling Agents and Correspondents may reasonably request for the
purposes contemplated by the 1933 Act or the SEC Regulations.
(d) During the period when the Prospectus is required to be delivered
pursuant to the 1933 Act, the General Partner and the Fund will use best
efforts to comply with all requirements imposed upon them by the 1933 Act
and the Commodity Act, each as now and hereafter amended, and by the SEC
Regulations and rules and regulations of the CFTC, as from time to time in
force, so far as necessary to permit the continuance of sales of, or
dealings in, the Units during such period in accordance with the provisions
hereof and as set forth in the Prospectus.
(e) If any event relating to or affecting the General Partner or the
Fund shall occur as a result of which it is necessary, in the reasonable
opinion of the Selling Agent, to amend or supplement the Prospectus in
order to make the Prospectus not materially misleading in light of the
circumstances existing at the time it is delivered to a subscriber, the
General Partner and the Fund will forthwith prepare and furnish to the
Selling Agent, at the expense of the General Partner, a reasonable number
of copies of an amendment or amendments of, or a supplement or supplements
to, the Prospectus which will amend or supplement the Prospectus so that as
amended or supplemented it will not contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in light of the circumstances existing at the time
the Prospectus is delivered to a subscriber, not misleading. No such
amendment or supplement shall be filed without the approval of the Selling
Agent, the Broker and the Trading Advisor.
(f) The General Partner will use best efforts to qualify the Units
for offer and sale under applicable securities or "Blue Sky" laws and
continue such qualification throughout the Offering Period, provided that
in no event shall the General Partner or the Fund be obligated to (i) take
any action which would subject it to service of process in suits other than
those arising out of the offering or sale of the Units, or taxes, in any
jurisdiction where either is not now so subject, (ii) change any material
term in the Registration Statement or (iii) expend a sum of money
considered unreasonable by the General Partner.
16
Section 7. Covenants of the Trading Advisor.
(a) The Trading Advisor agrees to cooperate, to the extent reasonably
requested by the General Partner, in the preparation of any amendments or
supplements relating to itself to the Registration Statement and the
Prospectus.
(b) During the period when the Prospectus is required to be delivered
under the 1933 Act, the Trading Advisor agrees to notify the General
Partner immediately upon discovery of any untrue or misleading statement
regarding it, its operations or any of its principals or of the occurrence
of any event or change in circumstances which would result in there being
any untrue or misleading statement or an omission in the Prospectus or
Registration Statement regarding it, its operations or any of its
principals or result in the Prospectus not including all information
relating to the Trading Advisor and its principals required pursuant to
CFTC regulations. During such period, the Trading Advisor shall promptly
inform the General Partner if it is necessary to amend or supplement the
Prospectus in order to make the Prospectus not materially misleading in
light of the circumstances existing at the time the Prospectus is delivered
to a subscriber.
Section 8. Covenants of the Broker.
(a) The Broker agrees to cooperate, to the extent reasonably
requested by the General Partner, in the preparation of any amendments or
supplements relating to itself to the Registration Statement and the
Prospectus.
(b) During the period when the Prospectus is required to be delivered
under the 1933 Act, the Broker agrees to notify the General Partner
immediately upon discovery of any untrue or misleading statement regarding
it, its operations or any of its principals or of the occurrence of any
event or change in circumstances which would result in there being any
untrue or misleading statement or an omission in the Prospectus or
Registration Statement regarding it, its operations or any of its
principals or result in the Prospectus not including all information
relating to the Broker and its principals required pursuant to CFTC
regulations. During such period, the Broker shall promptly inform the
General Partner if it is necessary to amend or supplement the Prospectus in
order to make the Prospectus not materially misleading in light of the
circumstances existing at the time the Prospectus is delivered to a
subscriber.
Section 9. Payment of Expenses and Fees. The General Partner will pay
all expenses incident to the performance of the obligations of the General
Partner and the Fund hereunder, including: (i) the printing and delivery to the
Selling Agent in quantities as hereinabove stated of copies of the Registration
Statement and all amendments thereto, of the Prospectus and any supplements or
amendments thereto, and of any supplemental sales materials; (ii) the
reproduction of this Agreement and the printing and filing of the Registration
Statement and the Prospectus (and, in certain cases, the exhibits thereto) with
the SEC, CFTC and NFA; (iii) the qualification of the Units
17
under the securities or "Blue Sky" laws in the various jurisdictions, including
filing fees and the fees and disbursements of the General Partner's counsel
incurred in connection therewith; (iv) the services of counsel and accountants
for the General Partner and the Fund, including certain services of Arthur F.
Bell, Jr. & Associates, L.L.C. in connection with their review of the
performance records in the Prospectus; (v) the printing or reproduction and
delivery to the Selling Agent of such number of copies as it may reasonably
request of the Blue Sky Survey; and (vi) "road show" presentations (not
including the expenses of the Trading Advisor and their personnel which shall be
borne by the Trading Advisor).
The General Partner and the Selling Agent are each aware of the
limitations imposed by Rule 2810 of the NASD on the aggregate selling
commissions which may be received by the Selling Agent in connection with the
offering and sale of the Units. The General Partner will in no event make any
payments to the Selling Agent nor shall the Selling Agent make any payments to
its own Registered Representatives or any Additional Selling Agents as described
above, which would exceed 9.5% of the gross proceeds of the Units sold to the
public. The General Partner shall not reimburse the Selling Agent for any due
diligence expenses in connection with the offering.
Section 10. Conditions of Closing. The obligations of each of the
parties hereunder are subject to the accuracy of the representations and
warranties of the other parties hereto, to the performance by such other parties
of their respective obligations hereunder and to the following further
conditions:
(a) At the Initial Public Closing Time and each Subsequent Public
Closing Time no order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceeding therefor
initiated or threatened by the SEC and no objection to the content thereof
shall have been expressed or threatened by the CFTC or the NFA.
(b) At the Initial Closing Time, Sidley & Austin, counsel to the
General Partner, shall deliver to all the parties hereto its
opinion, in form and substance satisfactory to each of the parties hereto,
to the effect that:
(i) The Certificate of Limited Partnership pursuant to which the
Fund has been formed and the Limited Partnership Agreement each
provides for the subscription for and sale of the Units; all action
required to be taken by the General Partner and the Fund as a
condition to the subscription for and sale of the Units to qualified
sub scribers therefor has been taken; and, upon payment of the
consideration therefor specified in the accepted Subscription
Agreements and Powers of Attorney, the Units will constitute valid
limited partnership interests in the Fund and each subscriber who
purchases Units will become a Limited Partner, subject to the
requirement that each such purchaser shall have duly completed,
executed and delivered to the Fund a Subscription Agreement and Power
of Attorney relating to the Units purchased by such party, that such
18
purchaser meets all applicable suitability standards as set forth in
the Prospectus and that the representations and warranties of such
purchaser in the Subscription Agreement and Power of Attorney are true
and correct.
(ii) The Fund is a limited partnership duly organized pursuant
to the Certificate of Limited Partnership, the Limited Partnership
Agreement and DRULPA and validly existing under the laws of the State
of Delaware with partnership power and authority to conduct the
business in which it proposes to engage as described in the
Prospectus; the Fund has qualified to do business in Texas and need
not effect any other filings or qualifications under the laws of the
United States and the States of Illinois, New York, Texas and
California and the District of Columbia in order to preserve the
status of the Fund as a limited partnership or to enable the Fund to
perform its obligations under the Advisory Agreement and this
Agreement and to conduct the business in which it proposes to be
engaged as described in the Prospectus.
(iii) The General Partner is duly organized and validly existing
and in good standing as a corporation under the laws of the State of
Texas with corporate power and authority to act as general partner of
the Fund, and is qualified to do business and is in good standing as a
foreign corporation in each other jurisdiction in which the failure to
so qualify might, in their opinion, reasonably be expected to result
in material adverse consequences to the Fund. The General Partner has
full corporate power and authority to perform its obligations as
described in the Registration Statement and Prospectus.
(iv) Each of the General Partner (including the principals, as
defined in the Commodity Act, of the General Partner) and the Fund has
all Federal and state governmental and regulatory licenses and
approvals and has received or made all filings and registrations with
Federal and state governmental and regulatory agencies necessary in
order for each of the General Partner and the Fund to conduct its
business as described in the Registration Statement and Prospectus,
and, to the best of their knowledge, none of such approvals, licenses
or registrations have been rescinded or revoked.
(v) Each of the Limited Partnership Agreement, the Advisory
Agreement, the Customer Agreement, the Investment Advisory Agreement,
the Additional Selling Agents Agreement and this Agreement has been
duly and validly authorized, executed and delivered by or on behalf of
the General Partner or the Fund (as the case may be) and assuming that
such agreements are legal, valid and
19
binding on the other parties hereto and thereto, each of the Limited
Partnership Agreement, the Advisory Agreement, the Customer Agreement,
the Investment Advisory Agreement, the Additional Selling Agents
Agreement and this Agreement constitutes a legal, valid and binding
agreement of the General Partner or the Fund (as the case may be)
enforceable in accordance with its terms, except to the extent
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws of general applicability
relating to or affecting the enforcement of creditors' rights and by
the effect of general principles of equity (regardless of whether
enforceability is considered in a proceeding in equity or at law).
(vi) The execution and delivery of this Agreement, the Limited
Partnership Agreement, the Customer Agreement, the Investment
Advisory Agreement, the Additional Selling Agents Agreement and the
Advisory Agreement and the incurrence of the obligations herein and
therein set forth and the consummation of the transactions
contemplated herein and therein and in the Prospectus will not be in
contravention of any of the provisions of the General Partner's
certificate of incorporation or by-laws, of the Limited Partnership
Agreement, and, to their knowledge, will not constitute a breach of,
or default under, any instrument by which the General Partner or the
Fund is bound or any order, rule or regulation applicable to the
General Partner or the Fund of any court or any governmental body or
administrative agency having jurisdiction over the General Partner or
the Fund.
(vii) To their knowledge, there are no actions, claims or
proceedings pending or threatened in any court or before or by any
governmental or administrative body, nor have there been any such
suits, claims or proceeding within the last five years, to which the
General Partner (or any principal of the General Partner) or the Fund
is or was a party, or to which any of their assets is or was subject,
which are required to be, but are not disclosed in, the Registration
Statement or Prospectus or which might reasonably be expected to
materially adversely affect the condition (financial or otherwise),
business or prospects of the General Partner or the Fund.
(viii) No authorization, approval or consent of any governmental
authority or agency is necessary in connection with the subscription
for and sale of the Units, except such as may be required under the
1933 Act, the Commodity Act, NFA compliance rules or applicable
securities or "Blue Sky" laws.
20
(ix) The terms and provisions of the Limited Partnership
Agreement, the Customer Agreement, the Advisory Agreement, the
Investment Advisory Agreement, the Additional Selling Agents
Agreement and this Agreement conforms in all material respects to
descriptions thereof contained in the Prospectus.
(x) The Registration Statement is effective under the 1933 Act
and, to the best of their knowledge, no proceedings for a stop order
are pending or threatened under Section 8(d) of the 1933 Act.
(xi) At the time the Registration Statement initially became
effective and at the time any post-effective amendment thereto became
effective, the Registration Statement, and at the time the Prospectus
and any amendments or supplements thereto were first issued, the
Prospectus, complied as to form in all material respects with the
requirements of the 1933 Act, the SEC Regulations under the 1933 Act
and CFTC regulations. Nothing has come to their attention that would
lead them to believe that with respect to the General Partner and the
Selling Agent (a) at the time the Registration Statement initially
became effective and at the time any post-effective amendment thereto
became effective, the Registration Statement contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or (b) the Prospectus as first issued or as
subsequently issued or at the Initial Public Closing Time contained an
untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading;
provided, however, that such counsel need express no opinion (A) as to
the financial statements, notes thereto and other financial or
statistical data set forth in the Registration Statement and
Prospectus or (B) as to any performance data set forth in the
Registration Statement, and Prospectus, including the performance
summaries (and the notes thereto) in the Registration Statement and
Prospectus, except that such counsel shall opine, without rendering
any opinion as to the accuracy of the information in the performance
summaries, that such the performance summaries comply as to form in
all material respects with applicable CFTC rules.
(xii) Such counsel confirm their opinion, a form of which
appears as Exhibit 8.01 to the Registration Statement, that the sum
mary of Federal income tax consequences to Limited Partners set forth
under the caption "Tax Consequences" in the Prospectus accurately
describes the material tax consequences set forth therein
21
and that such counsel further confirm their advice to the General
Partner explicitly set forth therein and in such Exhibit 8.01.
(xiii) To the best of their knowledge, (a) there are no
contracts, indentures, mortgages, loan agreements, leases or other
documents of a character required to be described or referred to in
the Registration Statement or Prospectus or to be filed as exhibits to
the Registration Statement other than those described or referred to
therein or filed as exhibits thereto, and with respect to the existing
contracts, indentures, mortgages, loan agreements, leases and other
documents so described, referred to or filed, the descriptions
thereof, references thereto or copies so filed are correct in all
material respects, and (b) no material default on the part of the
General Partner or the Fund exists in the due performance or
observance of any material obligation, agreement, covenant or
condition contained in any contract or lease so described or filed.
(xiv) Assuming operation in accordance with the Prospectus, the
Fund, at Closing Time, is not an "investment company" as that term is
defined in the Investment Company Act of 1940, as amended.
In rendering the opinions set forth above, Sidley & Austin may rely as to
certain matters relating to the General Partner on Fishman, Jones, Walsh &
Gray, P.C.
(c) Counsel to the Selling Agent shall deliver to all the parties
hereto, an opinion to the effect that:
(i) The Selling Agent is duly organized and validly existing
and in good standing as a corporation under the laws of the State of
Texas and is qualified to do business and in good standing as a
foreign corporation in each jurisdiction in which such qualification
is required and in which the failure to so qualify might, in such
counsel's opinion, reasonably be expected to result in material
adverse consequences to the Fund. The Selling Agent has full corporate
power and authority to perform its obligations as described in the
Registration Statement and Prospectus.
(ii) This Agreement has been duly authorized, executed and
delivered by the Selling Agent, and constitutes a legal, valid and
binding agreement of the Selling Agent enforceable in accordance with
its terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws of
general applicability relating to or affecting the enforcement of
creditors' rights and by the effect of general principles of equity
(regardless of whether enforceability is considered).
(iii) The Selling Agent has all Federal and state governmental
and regulatory licenses and approvals and has received or made all
filings and registrations with Federal and state governmental and
regulatory agencies necessary in order for the Selling Agent to
conduct its business as described in the Registration Statement and
Prospectus, and, to such counsel's knowledge, none of such approvals,
licenses or registrations has been rescinded or revoked.
(iv) The execution and delivery of this Agreement, the
incurrence of the obligations herein set forth and the consummation of
the transactions contemplated herein and in the Prospectus will not,
to the best of such counsel's knowledge, constitute a breach of, or
default under, any instrument known to such counsel by which the
Selling Agent is bound or, any order, rule or regulation applicable to
the Selling Agent, of any court or any governmental body or
administrative agency having jurisdiction over the Broker.
(v) To such counsel's knowledge, there are no actions, claims
or proceedings pending or threatened in any court or before or by a
governmental or administrative body, nor have there been any suits,
claims or proceedings within the last five years, to which the Selling
Agent (or any principal of the Selling Agent) is or was a party or to
which any of its assets is or was subject, which are required to be
22
disclosed in the Registration Statement or Prospectus or which might
reasonably be expected to materially adversely affect the business of
the Selling Agent.
(vi) Nothing has come to such counsel's attention that would
lead such counsel to believe that (a) at the time the Registration
Statement initially became effective and at the time any post-
effective amendment thereto became effective, insofar as the Selling
Agent and its principals are concerned, the Registration Statement
contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or (b) the Prospectus as first filed
pursuant to Rule 424(b) or as subsequently filed pursuant to Rule 424
or at the Initial Public Closing Time contained an untrue statement of
a material fact or omitted to state a material fact necessary in order
to make the statements therein relating to the Selling Agent or its
principals, in light of the circumstances under which they were made,
not misleading.
(d) Counsel to the Trading Advisor shall deliver to the General
Partner, the Broker and the Selling Agent an opinion as of the Initial
Public Closing Time to the effect that:
(i) The Trading Advisor is a corporation duly organized,
validly existing and in good standing under the laws of the State of
New York and is in good standing in each jurisdiction in which the
nature or conduct of its business requires such qualification and in
which the failure to so qualify might reasonably be expected to
materially adversely affect the Fund, as described in the Registration
Statement and Prospectus, and its ability to discharge its obligations
under the Advisory Agreement and this Agreement.
(ii) Each of the Advisory Agreement and this Agreement has been
duly authorized, executed and delivered by the Trading Advisor and
constitutes a valid, binding and enforceable agreement of the Trading
Advisor in accordance with its terms, subject only to bankruptcy,
insolvency, reorganization, moratorium or similar laws at the time in
effect affecting the enforceability generally of rights of creditors
and except as enforceability of the indemnification provisions
contained in such Agreements may be limited by applicable law and the
enforcement of specific terms or remedies may be unavailable.
(iii) The Trading Advisor (including the principals of the
Trading Advisor) has all material Federal and state governmental and
regulatory licenses and approvals and has received or made all filings
23
and registrations with Federal and state governmental and regulatory
authorities necessary in order for the Trading Advisor to conduct its
business as described in the Registration Statement and Prospectus
(including, without limitation, performance of this Agreement and the
Advisory Agreement) and, to the best of such counsel's knowledge, none
of such approvals, licenses or registrations has been rescinded or
revoked.
(iv) There is not pending or, to the best of such counsel's
knowledge, threatened any actions, suits or proceedings before or by
any court or other governmental or administrative body, nor have there
been any such suits, claims or proceedings within the last five years
to which the Trading Advisor, or any of its principals, is or was a
party, or to which any of their assets is or was subject, which are
required to be, but are not disclosed in the Registration Statement or
Prospectus or which might reasonably be expected to result in any
material adverse change in the condition (financial or otherwise),
business or prospects of the Trading Advisor.
(v) The execution and delivery of this Agreement and the
Advisory Agreement, the incurrence of the obligations herein and
therein set forth and the consummation of the transactions
contemplated herein, therein and in the Prospectus will not be in
contravention of any of the provisions of the certificate of
incorporation or by-laws of the Trading Advisor, or, to the best of
such counsel's knowledge, constitute a breach of, or default under,
any instrument by which the Trading Advisor is bound or any order,
rule or regulation applicable to the Trading Advisor of any court or
any governmental body or administrative agency having jurisdiction
over the Trading Advisor.
(vi) Nothing has come to such counsel's attention that would
lead such counsel to believe that (a) at the time the Registration
Statement initially became effective and at the time any post-
effective amendment thereto became effective, insofar as the Trading
Advisor and its principals are concerned, the Registration Statement
contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or (b) the Prospectus as first filed
pursuant to Rule 424(b) or as subsequently filed pursuant to Rule 424
or at the Initial Public Closing Time contained an untrue statement of
a material fact or omitted to state a material fact necessary in order
to make the statements therein relating to the Trading Advisor or its
principals, in light of the circumstances under which they were made,
not misleading; provided, however, that no counsel for the Trading
Advisor need express an opinion or belief (A) as to the financial
state-
24
ments, notes thereto and other financial or statistical data and notes
or descriptions thereto set forth in the Registration Statement and
Prospectus or (B) as to the performance data and notes or descriptions
thereto set forth in the Registration Statement, except that such
counsel shall opine, without rendering any opinion as to the accuracy
of the information in such performance summaries, that the performance
summaries relating to the Trading Advisor set forth in the Prospectus
comply as to form in all material respects with CFTC rules.
(e) At the Initial Public Closing Time, the General Partner shall
deliver a certificate to the effect that: (i) no order suspending the
effectiveness of the Registration Statement has been issued and to the best
of its knowledge no proceedings therefor have been instituted or threatened
by the SEC, the CFTC or other regulatory body; (ii) the representations and
warranties of the General Partner contained herein are true and correct
with the same effect as though expressly made at the Initial Closing Time
and in respect of the Registration Statement as in effect at the Initial
Public Closing Time; and (iii) the General Partner has performed all
covenants and agreements herein contained to be performed on its part at or
prior to the Initial Public Closing Time. Such certificate may state that
the General Partner has relied upon the Trading Advisor to provide certain
information relating to the Trading Advisor for use in the Registration
Statement.
(f) The Trading Advisor shall deliver a report dated as of the
Initial Public Closing Time which shall present, for the period from the
date after the last day covered by the performance summaries in the
Prospectus to the latest practicable day before the Initial Public Closing
Time, figures which shall be a continuation of such performance records and
which shall certify that such figures are accurate in all material
respects. The Trading Advisor shall also certify that such performance
summaries have been calculated in accordance with the notes to the
applicable performance summaries in the Prospectus.
(g) If requested by the General Partner, at the time the Registration
Statement initially becomes effective, Arthur F. Bell, Jr. & Associates,
L.L.C. shall have delivered a letter, substantially in the form previously
agreed upon by the Selling Agent and the General Partner.
(h) If requested by the General Partner, at the Initial Public
Closing Time, Arthur F. Bell, Jr. & Associates, L.L.C. shall deliver a
letter in a form satisfactory to the Selling Agent and the General Partner,
substantially the same in scope and substance as the letter described in
paragraph (h) of this Section 10, dated as of Initial Public Closing Time.
(i) At the Initial Public Closing Time, the Trading Advisor shall
make an investment in the Units in accordance with the Advisory Agreement.
25
(j) At the Initial Public Closing Time, the Trading Advisor shall
deliver a certificate to the effect that (i) the representations and
warranties of contained herein are true and correct with the same effect as
though expressly made at the Initial Public Closing Time, (ii) the Trading
Advisor has performed all covenants and agreements herein contained to be
performed on its part at or prior to the Initial Public Closing Time and
(iii) since the date of the most recent financial information relating to
the Trading Advisor prior to the date of this Agreement there has been no
material adverse change, or development involving a prospective material
adverse change, in the financial condition, business or business prospects
of the Trading Advisor.
(k) At the Initial Public Closing Time, the Broker shall deliver a
certificate to the effect that the representations and warranties of the
Broker contained herein are true and correct with the same effect as though
expressly made at the Initial Public Closing Time and in respect of the
Registration Statement as in effect at the Initial Public Closing Time.
(l) At the Initial Public Closing Time, the Selling Agent shall
deliver a certificate to the effect that the representations and
warranties of the Selling Agent contained herein are true and correct with
the same effect as though expressly made at the Initial Public Closing Time
and in respect of the Registration Statement as in effect at the Initial
Public Closing Time.
(m) The parties hereto shall have been furnished with such additional
information, opinions and documents, including supporting documents
relating to parties described in the Prospectus and certificates signed by
such parties with regard to information relating to them and included in
the Prospectus as they may reasonably require for the purpose of enabling
them to pass upon the sale of the Units as herein contemplated and related
proceedings, in order to evidence the accuracy or completeness of any of
the representations or warranties or the fulfillment of any of the
conditions herein contained; and all actions taken by the parties hereto in
connection with the sale of the Units as herein contemplated shall be
reasonably satisfactory in form and substance to counsel to the Trading
Advisor, counsel to the Broker, counsel to the Selling Agent and Sidley &
Austin.
If any of the conditions specified in this Section 10 shall not have
been fulfilled when and as required by this Agreement to be fulfilled, this
Agreement and all obligations hereunder may be canceled by any party hereto
by notifying the other parties hereto of such cancellation in writing or by
telegram at any time at or prior to the Initial Public Closing Time, and
any such cancellation or termination shall be without liability of any
party to any other party except as otherwise provided in Section 9.
(n) The representations and warranties set forth herein shall be
restated as of each Subsequent Closing Time as if made as of the date
thereof. The conditions of closing set
26
forth in this Section 10 shall, at the option of the General Partner, apply
at each Subsequent Closing Time.
Section 11. Indemnification and Exculpation.
(a) Indemnification by the General Partner. The General Partner
agrees to indemnify and hold harmless the Selling Agent, the Broker, any
Wholesaler, any Additional Selling Agent, any Correspondent, the Broker and
the Trading Advisor and each person, if any, who controls the Selling
Agent, the Broker or the Trading Advisor within the meaning of Section 15
of the 1933 Act, as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto) or any omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary in order to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or any amendment or
supplement thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading,
unless (a) in the case of the Trading Advisor, such untrue statement
or omission or alleged untrue statement or omission was made in
reliance upon and in conformity with information relating to the
Trading Advisor furnished or approved in writing by the Trading
Advisor, (b) in the case of the Selling Agent, such untrue statement
or omission or alleged untrue statement or omission was made in
reliance upon and in conformity with information relating to the
Selling Agent or furnished or approved by the Selling Agent, (c) in
the case of the Broker, such untrue statement or omission or alleged
untrue statement or omission was made in reliance upon and in
conformity with information relating to the Broker furnished or
approved by the Broker or (d) in the case of any Wholesaler,
Additional Selling Agent or Correspondent, such untrue statement or
omission or alleged untrue statement or omission was made in reliance
upon and in conformity with information relating to such Wholesaler,
Additional Selling Agent or Correspondent furnished or approved by
such Wholesaler, Additional Selling Agent or Correspondent;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by
any governmental agency or body commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission
27
or any such alleged untrue statement or omission (any settlement to be
subject to indemnity hereunder only if effected with the written
consent of the General Partner); and
(iii) against any and all expense whatsoever (including the fees
and disbursements of counsel) reasonably incurred in investigating,
preparing or defending against litigation, or any investigation or
proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under
clauses (i) or (ii) above.
In no case shall the General Partner be liable under this indemnity
agreement with respect to any claim made against any indemnified party
unless the General Partner shall be notified in writing of the nature of
the claim within a reasonable time after the assertion thereof, but failure
to so notify the General Partner shall not relieve the General Partner from
any liability which it may have otherwise than on account of this indemnity
agreement. The General Partner shall be entitled to participate at its own
expense in the defense or, if it so elects within a reasonable time after
receipt of such notice, to assume the defense of that portion of any suit
so brought relating to the General Partner's indemnification obligations
hereunder, which defense shall be conducted by counsel chosen by it and
satisfactory to the indemnified party or parties, defendant or defendants
therein. In the event that the General Partner elects to assume the defense
of any such suit and retain such counsel, the indemnified party or parties,
defendant or defendants in the suit, shall, in the absence of conflicting
claims, bear the fees and expenses of any additional counsel thereafter
retained by it or them.
In no event, however, shall the General Partner be obligated to
indemnify the Selling Agent hereunder, and the Selling Agent agrees not to
attempt to obtain any indemnity from the General Partner hereunder, to the
extent that the General Partner and the Selling Agent are advised by
counsel reasonably satisfactory to the General Partner and the Selling
Agent that payment of such indemnity could adversely affect the
classification of the Fund as a partnership for Federal income tax
purposes.
The General Partner agrees to notify the Trading Advisor, the Broker
and the Selling Agent within a reasonable time of the assertion of any
claim in connection with the sale of the Units against it or any of its
officers or directors or any person who controls the General Partner within
the meaning of Section 15 of the 1933 Act.
(b) Indemnification by the Trading Advisor. The Trading Advisor
agrees to indemnify and hold harmless the Selling Agent, the Broker, the
General Partner, the Fund and each person, if any, who controls the Selling
Agent, the Broker, the Fund or the General Partner within the meaning of
Section 15 of the 1933 Act (and, in the case of the General Partner and the
Fund, each person who signed the Registration
28
Statement or is a director of the General Partner), to the same extent as
the indemnity from the General Partner set forth in Section 11(a) hereof,
but only insofar as the losses, claims, damages, liabilities or expenses
indemnified against arise out of or are based upon any untrue statement or
omission or alleged untrue statement or omission relating or with respect
to the Trading Advisor or any principal of the Trading Advisor, or their
operations, trading systems, methods or performance, which was made in any
preliminary prospectus, the Registration Statement or the Prospectus or any
amendment or supplement thereto and furnished by or approved by the Trading
Advisor for inclusion therein.
(c) Indemnification by the Broker. The Broker agrees to indemnify and
hold harmless the Selling Agent, the Trading Advisor, the General Partner,
the Fund and each person, if any, who controls the Selling Agent, the
Trading Advisor, the Fund or the General Partner within the meaning of
Section 15 of the 1933 Act (and, in the case of the General Partner and the
Fund, each person who signed the Registration Statement or is a director of
the General Partner), to the same extent as the indemnity from the General
Partner set forth in Section 11(a) hereof, but only insofar as the losses,
claims, damages, liabilities or expenses indemnified against arise out of
or are based upon any untrue statement or omission or alleged untrue
statement or omission relating or with respect to Broker, which was made in
any preliminary prospectus, the Registration Statement or the Prospectus or
any amendment or supplement thereto and furnished by or approved by the
Broker for inclusion therein.
(d) Indemnification by the Selling Agent. The Selling Agent agrees to
indemnify and hold harmless the Broker, the General Partner, the Fund, the
Trading Advisor and each person, if any, who controls the Broker, the
General Partner, the Fund or the Trading Advisor within the meaning of
Section 15 of the 1933 Act (and in the case of the General Partner and the
Fund, each person who signed the Registration Statement or is a director of
the General Partner), (i) to the same extent as the indemnify from the
General Partner set forth in Section 11(a) hereof, but only insofar as the
losses, claims, damages, liabilities or expenses indemnified against arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission relating or with respect to the Selling Agent or any
of its principals, or their operations, which was made in any preliminary
prospectus, the Registration Statement or the Prospectus or any amendment
or supplement thereto and furnished by or approved by the Selling Agent for
inclusion therein and (ii) against any and all loss, liability, claim,
damage and expense whatsoever resulting from a demand, claim, lawsuit,
action or proceeding relating to the actions or capacities of the Selling
Agent (including a breach of its obligations hereunder) and any Wholesaler,
Additional Selling Agent or Correspondent relating to the offering of Units
under this Agreement or any Wholesaling Agreement, Additional Selling Agent
Agreement or Correspondent Selling Agent Agreement as the case may be.
(e) Contribution. If the indemnification provided for in this Section
11 is not permitted under applicable law under subsection (a), (b), (c) or
(d) above in
29
respect of any losses, claims, damages or liabilities (or actions in
respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in
respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Trading Advisor, on the one hand, and,
the Selling Agent, the Broker and the General Partner, on the other, from
the offering of the Units.
(f) Limitation on Certain Indemnifications and Exculpations. The
exculpation provisions in the Advisory Agreement shall not relieve the
Trading Advisor from any liability it may have or incur to the Fund, the
General Partner, the Selling Agent or the Broker under this Agreement
(including, without limitation, pursuant to the provisions of Section 11(b)
hereof). Nor shall the Trading Advisor be entitled to be indemnified by the
General Partner, pursuant to the indemnification provisions contained in
the Advisory Agreement, against any loss, liability, damage, cost or
expense it may incur under this Agreement. The General Partner shall not be
entitled to be indemnified by the Fund, pursuant to the indemnification
provisions contained in the Limited Partner ship Agreement against any
loss, liability, damage, cost or expense it may incur under this Agreement.
Section 12. Status of Parties. In selling the Units for the Fund, the
Selling Agent is acting solely as an agent for the Fund and not as a principal.
The Selling Agent will use its best efforts to assist the Fund in obtaining
performance by each purchaser whose offer to purchase Units from the Fund has
been accepted on behalf of the Fund, but the Selling Agent shall not have any
liability to the Fund in the event that Subscription Agreements and Powers of
Attorney are improperly completed or any such purchase is not consummated for
any reason.
Although the Trading Advisor and the Fund have entered into the
Advisory Agreement, all parties hereto acknowledge that none of such parties has
the power to act for another in any respect, except as set forth in the Advisory
Agreement, and that in no event shall the Fund be held responsible hereunder for
the acts and omissions of the Trading Advisor (or, conversely, the Trading
Advisor be held responsible for acts and omissions of the Fund) as a consequence
of the Advisory Agreement.
Section 13. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or contained in certificates of any party hereto submitted pursuant
hereto shall remain operative and in full force and effect, regardless of any
investigation made by, or on behalf of, the Selling Agent, the General Partner,
the Fund, the Broker, the Trading Advisor or any person who controls any of the
foregoing and shall survive the Initial Public Closing Time.
Section 14. Termination. The General Partner shall have the right to
terminate this Agreement at any time prior to the Initial Public Closing Time by
giving written notice of such termination to the Trading Advisor, the Selling
Agent and the Broker.
Section 15. Notices and Authority to Act. All communications
hereunder shall be in writing and, if sent to the Selling Agent, the General
Partner, the Broker, the Trading Advisor or
30
the Fund, shall be mailed, delivered or telegraphed and confirmed as set forth
below and shall be effective when actually received.
If to the General Partner:
-------------------------
ProFutures Inc.
11612 Bee Cave Road
Suite 100
Austin, Texas 78733
Attention: Gary Halbert
Phone: (512) 263-3800
Telecopier: (512) 263-3459
If to the Fund:
--------------
ProFutures Bull & Bear Fund, L.P.
c/o ProFutures, Inc.
11612 Bee Cave Road
Suite 100
Austin, Texas 78733
Attention: Gary Halbert
Phone: (512) 263-3800
Telecopier: (512) 263-3459
If to the Selling Agent:
-----------------------
ProFutures Financial Group, Inc.
11612 Bee Cave Road
Suite 100
Austin, Texas 78733
Attention: Gary Halbert
Phone: (512) 263-3800
Telecopier: (512) 263-3459
If to the Broker:
----------------
ING (U.S.) Securities, Futures &
Options, Inc.
233 S. Wacker Drive
Suite 5200
Chicago, IL 60606
Attention: Brac Carr
Phone: (312) 496-7000
Facsimile: (312) 496-7214
31
If to the Advisor:
-----------------
Hampton Investors, Inc.
2519 Avenue U
Brooklyn, New York 11229
Attention: Charles & Gary Mizrahi
Phone: (800) 524-4832
Telecopier: (718) 891-2455
Section 16. Parties. This Agreement shall inure to the benefit of and
be binding upon the Selling Agent, the Fund, the General Partner, the Broker,
the Trading Advisor and such parties' respective successors to the extent
provided herein. This Agreement and the conditions and provisions hereof are
intended to be and are for the sole and exclusive benefit of the parties hereto
and their respective successors, assigns and controlling persons and parties
indemnified hereunder, and for the benefit of no other person, firm or
corporation. No purchaser of a Unit shall be considered to be a successor or
assign solely on the basis of such purchase.
Section 17. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES CREATED HEREBY SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
Section 18. Requirements of Law. Whenever in this Agreement it is
stated that a party will take or refrain from taking a particular action, such
party may nevertheless refrain from taking or take such action if advised by
counsel that doing so is required by law or advisable to ensure compliance with
law, and shall not be subject to any liability hereunder for doing so, although
such action shall permit termination of the Agreement by the other parties
hereto.
32
If the foregoing is in accordance with each party's understanding of
its agreement, each party is requested to sign and return to the General Partner
a counterpart hereof, whereupon this instrument along with all counterparts will
become a binding agreement among them in accordance with its terms.
Very truly yours,
PROFUTURES BULL & BEAR FUND, L.P.
BY: PROFUTURES, INC., General Partner
By:
-------------------------------------
Name:
Title:
HAMPTON INVESTORS, INC., Trading Advisor
By:
-------------------------------------
Name:
Title:
ING. (U.S.) SECURITIES, FUTURES
& OPTIONS, INC., Broker
By:
-------------------------------------
Name:
Title:
PROFUTURES, INC., General Partner
By:
-------------------------------------
Name:
Title:
33
Confirmed and accepted as of
the date first above written:
PROFUTURES FINANCIAL GROUP,
INC., Selling Agent
By:
-------------------------
Name:
Title:
34