November 11 , 1986
BB&K Diversa Fund
000 Xxxxxxx'x Xxxxxx Xxxxxxxxx
Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000,
Re: BB&K Diversa Fund -- Purchase of Shares
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Ladies and Gentlemen:
In connection with my purchase of 10,000 shares of beneficial
interest (the "Shares") of the BB&K Diversa Fund (the "Fund"), a series of BB&K
Fund Group, a Massachusetts business trust, at a price of $10 per share, I
represent, warrant and agree as follows:
(a) I am purchasing the Shares for my own account for
investment and not with a view to, or for resale in connection with, any
distribution thereof. I have no present intention of selling or otherwise
disposing of the Shares, and no other person will have any legal or beneficial
interest in the Shares.
(b) I understand that the Shares have not been
registered under the Securities Act of 1933, as amended (the "Act"), and that
the Shares have not been qualified for sale pursuant to the California Corporate
Securities Law of 1968, by reason of specific exemptions therefrom, both of
which exemptions depend, among other things, upon the bona fide nature of my
investment intent as expressed herein.
(c) I acknowledge that the Shares must be held
indefinitely and cannot be resold unless they are registered and qualified under
the Act and applicable state securities laws or an exemption from such
registration and qualification is available, and that the Fund is under no
obligation to register or qualify the Shares under the Act or any applicable
state securities law or to assist me in complying with any such exemption.
(d) I agree not to make any disposition of all or any
portion of the Shares unless and until:
(1) 1 have notified the Fund of the proposed
disposition and have furnished the Fund with a detailed statement of the
circumstances surrounding the proposed disposition; and
EXHIBIT 13
(2) If reasonably requested by the Fund, I
have furnished the Fund with an opinion of counsel, reasonably satisfactory to
the Fund, that such disposition will comply with the Act and any applicable
state securities laws.
(e) I understand that if I redeem any of the Shares
during the five year period beginning with the commencement of operations of the
Fund, the net asset value payable with respect to such redeemed Shares will be
reduced by the pro-rata portion (based on the proportion of Shares being
redeemed to the total number of Shares outstanding) of the then unamortized
deferred organization expenses of the Fund as of the date of such redemption.
(f) I understand that any certificates representing
the Shares will be endorsed with legends in substantially the following forms:
(1) THE SHARES REPRESENTED HEREBY HAVE
NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED,
AND ACCORDINGLY, MAY BE TRANSFERRED
ONLY IN A TRANSACTION WHICH IS
REGISTERED UNDER SUCH ACT OR IS, TO
THE SATISFACTION OF THE ISSUER,
EXEMPT FROM SUCH RECISTRATION
REQUIREMENT.
(2) THE NET ASSET VALUE PAYABLE UPON
REDEMPTION OF THE SHARES
REPRESENTED HEREBY IS SUBJECT TO
REDUCTION IN ACCORDANCE WITH AN
INVESTMENT LETTER DATED NOVEMBER ,
1986 EXECUTED BY THE ORIGINAL
SHAREHOLDER.
(3) Any legend required by applicable
state securities laws.
(g) I understand that the Fund will make a notation
in its records and advise any transfer agent of the restrictions on transfer
contained in the foregoing legends and will instruct the transfer agent to place
a stop-transfer order in the Fund's stock books respecting transfer of the
Shares.
(h) I have received and carefully reviewed a draft of
Pre-Effective Amendment No. I to the Form N-1A Registration Statement relating
to the Shares, filed with the Securities and Exchange Commission on October 28,
1986 (the
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"Registration Statement"). In evaluating the suitability of this investment, I
have not relied on any representation, oral or written, other than as set forth
in the Registration Statement and no such representation has been made to me.
(i) I have had an opportunity to discuss the Fund's
operations and financial condition with its management, to- ask questions and
receive answers concerning the terms and conditions of the offering and to
obtain any additional information which the Fund possesses or could acquire
without unreasonable effort or expense necessary to verify the accuracy of the
information contained in the Registration Statement.
(j) I understand that an investment in the Shares
involves certain risks, and that no federal or state agency has recommended or
endorsed an investment in the Shares or made any determination as to the
fairness of such investment.
(k) I have a preexisting business relationship with
Xxxxxx X. Xxxxxx, a trustee and chief executive officer of the Fund.
(l) 1 have such knowledge and experience in business
and financial matters, and particularly in investment matters, that I am capable
of evaluating the Fund and the proposed activities thereof, and the risks and
merits of this investment.
(m) I am able to bear the economic risk of this
investment for an indefinite period of time and can afford the complete loss of
this investment. I have a joint net worth (exclusive of home, home furnishings
and automobiles) with my spouse in excess of $1,000,000.
(n) I have carefully considered, and have, to the
extent I believe necessary, discussed with my legal, tax and/or financial
advisers, the suitability of an investment in the Shares for my particular
financial and tax situation and have determined in light of the foregoing that
the Shares are a suitable investment for me.
(o)All information contained herein and provided by
me is complete and accurate as of the date hereof, and I will notify the Fund
immediately in writing of any change in such information prior to the acceptance
of this subscription by the Fund.
(p) I understand that the sale of the Shares to me
will be based upon the representations, warranties and
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agreements set forth above, and I agree to indemnify and hold harmless the Fund
and its officers, trustees, employees and control persons from and against any
and all loss, damage, liability or expense, including costs and attorneys' fees,
which any of them may incur by reason of any misrepresentation made by me in
this agreement, any breach by me of any warranty contained herein or any failure
by me to fulfill any agreement set forth herein or arising out of the sale or
other disposition of the Shares by me in violation of the Act or any applicable
state securities laws.
(q) I am a resident of the State of California.
Very truly yours,
/s/ X. Xxxxx Xxxxxxxxx
X. Xxxxx Xxxxxxxxx
Accepted:
BB&K FUND GROUP, on behalf of
the BB&K Diversa Fund
By /s/ [SIGNATURE ILLEGIBLE]
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Dated: November 12, 1986
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