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PROPOSED FORM OF
SOLICITING DEALER AGREEMENT
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Exhibit 1(a)
SOLICITING DEALER AGREEMENT
(Best Efforts)
RE: ATLAS-ENERGY FOR THE NINETIES-PUBLIC #5 LTD.
________________________
________________________
________________________
________________________
Gentlemen:
The undersigned, Atlas Resources, Inc. ("Atlas"), on behalf of
ATLAS-ENERGY FOR THE NINETIES-PUBLIC #5 LTD., hereby confirms its
agreement with you as follows:
1. Description of Units. Atlas, as Managing General Partner, has formed
a limited partnership known as Atlas-Energy for the Nineties-Public
#5 Ltd. (the "Partnership"), and will issue and sell Units of
Participation in the Partnership (the "Units") at a price of $10,000
per Unit. The minimum Partnership Subscription is 100 Units
($1,000,000), excluding any optional subscription by the Managing
General Partner. No subscriptions to the Partnership will be accepted
after receipt of the maximum Partnership Subscription of $7,000,000
(which may be increased to $8,000,000 in Atlas' discretion) or
December 31, 1996, whichever event occurs first (the "Offering
Termination Date").
2. Representations. Warranties and Agreements of Atlas. Atlas represents
and warrants to and agrees with you that:
(a) The Units have been or will be registered with the Securities and
Exchange Commission (the "Commission") under the Securities Act
of 1933 (the "Act"), as amended.
(b) Atlas shall provide to you for delivery to all offerees and
purchasers and their representatives such information and
documents as Atlas deems appropriate to comply with the Act and
applicable state securities ("blue sky") laws.
(c) The Units when issued will be duly authorized and validly issued
as set forth in the Amended and Restated Certificate and
Agreement of Limited Partnership of the Partnership
("Partnership Agreement") set forth as Exhibit (A) to the
offering circular (the "Prospectus") and subject only to the
rights and obligations set forth in the Partnership Agreement or
imposed by the laws of the state of formation of the Partnership
or of any jurisdiction to the laws of which the Partnership is
subject.
(d) The Partnership was duly formed pursuant to the laws of the
Commonwealth of Pennsylvania and is validly existing as a
limited partnership in good standing under the laws of
Pennsylvania with full power and authority to own its properties
and conduct its business as described in the Prospectus. The
Partnership will be qualified to do business as a limited
partnership or similar entity offering limited liability in
those jurisdictions where Atlas deems such qualification
necessary to assure limited liability of the limited partners.
(e) The Prospectus, as heretofore or hereafter supplemented or
amended, does not contain an untrue statement of a material fact
or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they are made, not misleading.
3. Grant of Authority. On the basis of the representations and
warranties herein contained, and subject to the terms and conditions
herein set forth, Atlas, as Managing General Partner of the
Partnership, hereby appoints you as a Soliciting Dealer for the
Partnership and gives you the non-exclusive right to solicit
subscriptions for the Units, on a "best efforts" basis, subject to
the terms and conditions set forth herein.
4. Compensation and Fees.
(a) As compensation for this Agreement and for services rendered
hereunder, you shall receive a Sales Commission in an amount
equal to 7.5% and shall be entitled to reimbursement of your
bona fide accountable due diligence expenses in an amount equal
to .5% of each Unit sold by you and accepted by the Managing
General Partner. Subject to receipt and acceptance of the
minimum Partnership Subscription of 100 Units ($1,000,000), such
payments will be made to you approximately every two weeks until
the Offering Termination Date and all of your remaining fees
shall be paid by Atlas no later than 14 days after the Offering
Termination Date.
(b) Pending receipt of the minimum Partnership Subscription
($1,000,000), all proceeds received by you from the sale of
Units will be held in a separate interest bearing escrow account
as provided in Section 15. Unless at least one hundred (100)
Units ($10,000 per Unit) are sold by all duly authorized parties
on or before December 31, 1996, the offering shall be
terminated, in which event no fee shall be payable to you and
all funds advanced by purchasers shall be returned to them with
interest earned. In addition, you shall deliver a termination
letter in the form provided to you by Atlas to each such
subscriber and to each of the offerees previously solicited by
you in connection with the offering of the Units.
5. Covenants of Atlas. Atlas covenants and agrees that:
(a) Atlas will deliver to you ample copies of the Prospectus and of
all amendments or supplements thereto, heretofore or hereafter
made, including all exhibits and other documents included
therein.
(b) If any event affecting the Partnership or Atlas shall occur which
should be set forth in a supplement to or an amendment of the
Prospectus, Atlas will forthwith at its own expense prepare and
furnish to you a sufficient number of copies of a supplement or
amendment to the Prospectus so that it, as so supplemented or
amended, will not contain an untrue statement of a material fact
or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they are made, not misleading.
6. Representations and Warranties of Soliciting Dealer. You, as a
Soliciting Dealer, represent and warrant to Atlas that:
(a) You are a corporation duly organized, validly existing and in
good standing under the laws of the state of your formation or
of any jurisdiction to the laws of which you are subject, with
all requisite power and authority to enter into this Agreement
and to carry out your obligations hereunder.
(b) This Agreement when accepted and approved will be duly
authorized, executed and delivered by you and will be a valid
and binding agreement on your part in accordance with its terms.
(c) The consummation of the transactions contemplated by this
Agreement and the Prospectus will not result in any breach of
any of the terms or conditions of, or constitute a default under
your Articles of Incorporation, Bylaws, any indenture, agreement
or other instrument to which you are a party, or violate any
order applicable to you of any court or any federal or state
regulatory body or administrative agency having jurisdiction
over you or over your affiliates.
(d) You are duly registered pursuant to the provisions of the
Securities Exchange Act of 1934 (the "Act of 1934") as a dealer
and you are a member in good standing of the National
Association of Securities Dealers, Inc. (the "NASD"), and are
duly registered as a broker-dealer in such states as you are
required to be registered in order to carry out your obligations
as contemplated by this Agreement and the Prospectus. You agree
to maintain all of the foregoing registrations in good standing
throughout the term of the offer and sale of the Units and you
agree to comply with all statutes and other requirements
applicable to you as a broker-dealer pursuant to those
registrations.
(e) Pursuant to your appointment as a Soliciting Dealer, you shall
conduct all your activities hereunder to comply with all of the
provisions of the Act, insofar as the Act applies to you and
your activities hereunder, and you shall not engage in any
activity which would cause the offer and/or sale of Units not to
comply with the Act, the Act of 1934 and the applicable rules
and regulations of the Commission, the applicable state
securities laws and regulations, this Agreement and the NASD
Conduct Rules including Rules 2730, 2740, 2420 and 2750 and also
including but not limited to, Rule 2810(b)(2) and (b)(3) of the
NASD Conduct Rules, which provide as follows:
Sec. (b)(2)
SUITABILITY
(A) A member or person associated with a member shall not
underwrite or participate in a public offering of a
direct participation program unless standards of
suitability have been established by the program for
participants therein and such standards are fully
disclosed in the prospectus and are consistent with
the provisions of subsection (B) of this section.
(B) In recommending to a participant the purchase, sale or
exchange of an interest in a direct participation
program, a member or person associated with a member
shall:
(i) have reasonable grounds to believe, on the basis
of information obtained from the participant
concerning his investment objectives, other
investments, financial situation and needs, and
any other information known by the member or
associated person, that:
(a) the participant is or will be in a financial
position appropriate to enable him to
realize to a significant extent the benefits
described in the prospectus, including the
tax benefits where they are a significant
aspect of the program;
(b) the participant has a fair market net worth
sufficient to sustain the risks inherent in
the program, including loss of investment
and lack of liquidity; and
(c) the program is otherwise suitable for the
participant; and
(ii) maintain in the files of the member documents
disclosing the basis upon which the determination
of suitability was reached as to each
participant.
(C) Notwithstanding the provisions of subsections (A) and
(B) hereof, no member shall execute any transaction in
a direct participation program in a discretionary
account without prior written approval of the
transaction by the customer.
Sec. (b)(3)
DISCLOSURE
(A) Prior to participating in a public offering of a direct
participation program, a member or person associated
with a member shall have reasonable grounds to
believe, based on information made available to him by
the sponsor through a prospectus or other materials,
that all material facts are adequately and accurately
disclosed and provide a basis for evaluating the
program.
(B) In determining the adequacy of disclosed facts pursuant
to subsection (A) hereof, a member or person
associated with a member shall obtain information on
material facts relating at a minimum to the following,
if relevant in view of the nature of the program:
(i) items of compensation;
(ii) physical properties;
(iii) tax aspects;
(iv) financial stability and experience of the
sponsor;
(v) the program's conflicts and risk factors; and
(vi) appraisals and other pertinent reports.
(C) For purposes of subsections (A) and (B) hereof, a
member or person associated with a member may rely
upon the results of an inquiry conducted by another
member or members, provided that:
(i) the member or person associated with a member has
reasonable grounds to believe that such inquiry
was conducted with due care;
(ii) the results of the inquiry were provided to the
member or person associated with a member with
the consent of the member or members conducting
or directing the inquiry; and
(iii) no member that participated in the inquiry is a
sponsor of the program or an affiliate of such
sponsor.
(D) Prior to executing a purchase transaction in a direct
participation program, a member or person associated
with a member shall inform the prospective participant
of all pertinent facts relating to the liquidity and
marketability of the program during the term of
investment.
(f) You have received copies of the Prospectus relating to the Units
and you have relied only on the statements contained in such
Prospectus and not on any other statements whatsoever, either
written or oral, with respect to the details of the offering of
Units.
(g) You agree that you shall not place any advertisement or other
solicitation with respect to the Units (including without
limitation any material for use in any newspaper, magazine,
radio or television commercial, telephone recording, motion
picture, or other public media) without the prior written
approval of Atlas, and without the prior written approval of the
form and content thereof by the Commission, the NASD and the
securities authorities of the states where such advertisement or
solicitation is to be circulated. Any such advertisements or
solicitations shall be at your expense.
(h) If a supplement or amendment to the Prospectus is prepared and
delivered to you by Atlas, you agree to distribute each such
supplement or amendment to the Prospectus to every person who
has previously received a copy of the Prospectus from you and
you further agree to include such supplement or amendment in all
future deliveries of any Prospectus, and to keep file memoranda
indicating to whom each supplement or amendment was delivered.
(i) You agree to advise Atlas in writing of each state in which you
propose to offer or sell the Units and you agree not to offer or
sell Units in any state until such time as you shall have been
advised in writing by Atlas, or Atlas' special counsel, that
such offer or sale has been qualified in such state or is exempt
from the qualification requirements imposed by such state or
such qualification is otherwise not required.
(j) In connection with any offer or sale of the Units, you agree to
comply in all respects with statements set forth in the
Prospectus and the Partnership Agreement and you agree not to
make any statement inconsistent with the statements in the
Prospectus or the Partnership Agreement and you further agree
that you will not provide any written information, statements or
sales literature other than the Prospectus, the Brochure, and
any supplements or amendments thereto unless approved in writing
by Atlas; and you agree not to make any untrue or misleading
statements of a material fact in connection with the Units.
(k) You agree to use your best efforts in the solicitation and sale
of said Units, including insuring that the prospective
purchasers meet the suitability requirements set forth in the
Prospectus and the Subscription Agreement and properly execute
the Subscription Agreement, which has been provided as Exhibit
(I-B) to the Partnership Agreement, Exhibit (A) of the
Prospectus, together with any additional forms provided in any
supplement or amendment to the Prospectus, or otherwise provided
to you by Atlas to be completed by prospective purchasers.
Executed Subscription Agreements shall be delivered or mailed
immediately to Atlas and must be received by Atlas at or prior
to the Offering Termination Date. Atlas shall have the right to
reject any subscription at any time for any reason without
liability to it. Investor funds shall be transmitted as set
forth in Section 16.
(l) Although not anticipated, in the event you assist in any
transfers of the Units, you shall comply with the requirements
of Sections (b)(2)(B) and (b)(3)(D) of Rule 2810 of the NASD
Conduct Rules.
7. State Securities Registration. Incident to the offer and sale of the
Units, Atlas will either use its best efforts in taking all necessary
action and filing all necessary forms and documents deemed reasonable
by it in order to qualify or register Units for sale under the
securities laws of the states requested by you pursuant to Section
6(i) hereof or use its best efforts in taking any necessary action
and filing any necessary forms deemed reasonable by it which are
required to obtain an exemption from qualification or registration in
such states; provided Atlas may elect not to qualify or register
Units in any state in which it deems such qualification or
registration is not warranted for any reason in its sole discretion.
Atlas and its counsel will inform you as to the jurisdictions in
which the Partnership Units have been qualified for sale or are
exempt under the respective securities or blue sky laws of such
jurisdictions; but Atlas has not assumed and will not assume any
obligation or responsibility as to your right to act as a
broker-dealer with respect to the Units in any such jurisdiction.
Atlas will provide to you for delivery to all offerees and purchasers
and their representatives, any additional information, documents and
instruments which Atlas deems necessary to comply with the rules,
regulations and judicial and administrative interpretations in those
states and jurisdictions for the offer and sale of the Units in such
states. Atlas will file all post-offering forms, documents or
materials and take all other actions required by the states in which
the offer and sale of Units have been qualified or are exempt or in
which the Units have been registered; provided, Atlas shall not be
required to take any actions, make any filings or prepare any
documents necessary or required in connection with your status as a
broker-dealer under the laws of such states.
8. Expense of Sale. Atlas will pay all expenses incident to the
performance of its obligations hereunder, including the fees and
expenses of Atlas' attorneys and accountants and all fees and
expenses of registering or qualifying the Units for offer and sale in
the states as set forth in Section 7 hereof, or obtaining exemptions
therefrom, even in the event this offering is not successfully
completed. You will pay the fees and expenses of your own counsel and
accountants.
9. Conditions of Your Duties. Your obligations provided herein shall be
subject to the accuracy, as of the date hereof and at the Offering
Termination Date (as if made at the Offering Termination Date), of
the representations and warranties of Atlas herein and to the
performance by Atlas of its obligations hereunder.
10. Condition of Atlas' Duties. Atlas' obligations provided herein,
including the duty to pay compensation as set forth in Section 4
hereof, shall be subject to the accuracy, as of the date hereof and
at the Offering Termination Date (as if made at the Offering
Termination Date) of your representations and warranties made herein,
and to the performance by you of your obligations hereunder, and to
the additional condition that Atlas shall have received, at or prior
to the Offering Termination Date, the following documents:
(a) a fully executed Subscription Agreement for each prospective
purchaser;
(b) certification to Atlas that you are registered as required by
Section 6(d) and that such registrations were, during the term
of the offering and through the Offering Termination Date, in
full force and effect; and
(c) a certificate from you, dated at the Offering Termination Date,
to the effect that your representations and warranties made
herein are true and correct as if made at the Offering
Termination Date and that you have fulfilled all your
obligations hereunder.
11. Indemnification. You shall indemnify and hold harmless Atlas, the
Partnership and its attorneys, against any losses, claims, damages or
liabilities, joint or several, to which such parties may become
subject, under the Act, the Act of 1934 or otherwise insofar as such
losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon your breach of any of your
duties and obligations, representations, or warranties under the
terms or provisions of this Agreement and you will reimburse such
parties for any legal or other expenses reasonably incurred in
connection with investigating or defending such loss, claim, damage,
liability or action.
Atlas shall indemnify and hold you harmless against any losses,
claims, damages or liabilities, joint or several, to which you may
become subject, under the Act, the Act of 1934 or otherwise insofar
as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon Atlas' breach of any of its
duties and obligations, representations, or warranties under the
terms or provisions of this Agreement and Atlas will reimburse you
for any legal or other expenses reasonably incurred in connection
with investigating or defending such loss, claim, damage, liability
or action.
The foregoing indemnity agreements shall extend upon the same terms
and conditions to, and shall inure to the benefit of, each person, if
any, who controls each indemnified party within the meaning of the
Act.
Promptly after receipt by an indemnified party of notice of the
commencement of any action, such indemnified party shall, if a claim
in respect thereof is to be made against the indemnifying party under
this Section, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may have to
any indemnified party. In case any such action shall be brought
against such indemnified party, it shall notify the indemnifying
party of the commencement thereof, and the indemnifying party shall
be entitled to participate in, and, to the extent that it shall wish,
jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such
indemnified and indemnifying parties, and after the indemnified party
shall have received notice from the agreed upon counsel that the
defense under such paragraph has been so assumed, the indemnifying
party shall not be responsible for any legal or other expenses
subsequently incurred by such indemnified party in connection with
the defense thereof.
12. Representations and Agreements to Survive Delivery. All
representations, warranties and agreements of Atlas and you herein or
in certificates delivered pursuant hereto, and the indemnity
agreements contained in Section 11 hereof, shall survive the
delivery, execution and closing hereof, and shall remain operative
and in full force and effect regardless of any investigation made by
or on behalf of you or any person who controls you within the meaning
of the Act, or by Atlas, or any of its officers, directors or any
person who controls Atlas within the meaning of the Act, or any other
indemnified party, and shall survive delivery of the Units hereunder.
13. Termination. You shall have the right to terminate this agreement
other than the indemnification provisions of Section 11 by giving
notice as hereinafter specified any time at or prior to the Offering
Termination Date:
(a) if Atlas shall have failed, refused, or been unable at or prior
to the Offering Termination Date, to perform any of its
obligations hereunder; or
(b) there has occurred an event materially and adversely affecting the
value of the Units.
If you elect to terminate this Agreement other than the
indemnification provisions of Section 11, Atlas shall be promptly
notified by you by telephone, telecopier or telegram, confirmed by
letter.
Atlas may terminate this Agreement other than the indemnification
provisions of Section 11 for any reason by promptly giving notice to
you by telephone, telecopier or telegram, confirmed by letter as
hereinafter specified at or prior to the Offering Termination Date.
14. Notices. All notices or communications hereunder, except as herein
otherwise specifically provided, shall be in writing, and if sent to
you shall be mailed, delivered or telegraphed and confirmed to you at
the address set forth below your signature hereto or if sent to Atlas
or on behalf of the Partnership, at 311 Rouser Road, Moon Township,
Pennsylvania 15108.
15. Format of Checks/Escrow Agent. Pending receipt of the minimum
Partnership Subscription, Atlas and the Soliciting Dealer agree that
all subscribers will be instructed to make their checks payable
solely to "National City Bank, Escrow Agent, Atlas Public #5 Ltd." as
agent for the Partnership. Any Soliciting Dealer receiving a check
not conforming to the foregoing instructions shall return such check
directly to such subscriber not later than noon of the next business
day following its receipt. Checks received by the Soliciting Dealer
which conform to the foregoing instructions shall be transmitted for
deposit by the Soliciting Dealer pursuant to Section 16 "Transmittal
Procedures," below. The Soliciting Dealer represents that it has
executed Appendix II to the Escrow Agreement and agrees that it is
bound by the terms of the Escrow Agreement executed by Atlas, a copy
of which is attached hereto as Exhibit "A".
16. Transmittal Procedures. Atlas and the Soliciting Dealer agree that
transmittal of received investor funds will be made in accordance
with the following procedures:
Pending receipt of the minimum Partnership Subscription of
$1,000,000, the Soliciting Dealer shall promptly, upon receipt of any
and all checks, drafts, and money orders received from prospective
purchasers of Units, transmit same together with a copy of the
executed Subscription Agreement to the Escrow Agent by noon of the
second business day after the Managing General Partner receives the
subscription documents for purposes of a suitability determination,
which documents, together with a copy of the check, draft or money
order, were forwarded to the Managing General Partner by noon of the
next business day following receipt of the check, draft or money
order by the Soliciting Dealer.
Upon receipt by the Soliciting Dealer of notice from Atlas that the
minimum Partnership Subscription has been received, Atlas and the
Soliciting Dealer agree that all subscribers thereafter may be
instructed, in Atlas' sole discretion, to make their checks payable
solely to "Atlas Public #5 Ltd." and that received investor funds
shall be promptly transmitted by the Soliciting Dealer to Atlas as
Managing General Partner on behalf of the Partnership by noon of the
next business day following receipt of the check by the Soliciting
Dealer, together with the executed Subscription Agreement.
17. Parties. This Agreement shall inure to the benefit of and be binding
upon you, Atlas, and any respective successors and assigns and shall
also inure to the benefit of the indemnified parties, their
successors and assigns. This Agreement is intended to be and is for
the sole and exclusive benefit of the parties hereto, including the
Partnership, and their respective successors and assigns, and the
indemnified parties and their successors and assigns, and for the
benefit of no other person, and no other person shall have any legal
or equitable right, remedy or claim under or in respect of this
Agreement. No purchaser of any of the Units from you shall be
construed a successor or assign merely by reason of such purchase.
18. Relationship. This Agreement shall not constitute you a partner of
Atlas or the Partnership or any general partner thereof, nor render
Atlas, the Partnership, or the Managing General Partner thereof
liable for any of your obligations except as otherwise provided
herein.
19. Effective Date. This Agreement is made effective between the parties
as of the date accepted by you as indicated by your signature hereto.
20. Entire Agreement Waiver. This Agreement constitutes the entire
agreement between the parties hereto and shall not be amended or
modified in any way except by subsequent agreement executed in
writing, and no party shall be liable or bound to the other by any
agreement, except as specifically set forth herein. Any party hereto
may waive, but only in writing, any term, condition, or requirement
under this Agreement which is intended for its own benefit, and
written waiver of any term or condition of this Agreement shall not
operate as a waiver of any other breach of such term or condition,
nor shall any failure to enforce any provision hereof operate as a
waiver of such provision or any other provision hereof.
If the foregoing correctly sets forth our understanding please so
indicate in the space provided below for the purpose whereupon this
letter shall constitute a binding agreement between us.
Very truly yours,
ATLAS RESOURCES, INC.,
a Pennsylvania corporation
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By:
J. R. O'Mara, President
- ----------------------------, 1996
Date
ATTEST:
- ----------------------------------
(SEAL) Secretary PARTNERSHIP
ATLAS-ENERGY FOR THE NINETIES-
PUBLIC #5 LTD.
, 1996 By: Atlas Resources, Inc.
Date Managing General Partner
ATTEST: ------------------------
- ---------------------------------- By: J. R. O'Mara, President
(SEAL) Secretary
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,---------------------------- 1996 SOLICITING DEALER
Date a ______________________
corporation,
ATTEST: By:
- ---------------------------------- [Print Name, Title and Address]
(SEAL) Secretary
Wholesaler [Print Name]
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