KEY HOSPITALITY ACQISITION CORPORATION
SELECTED DEALER AGREEMENT
Ladies and Gentlemen:
Maxim Group LLC ("Maxim") is acting as the representative of
the underwriters (the "Underwriters") in a firm commitment, underwritten
offering (the "Offering") to sell 10,000,000 units (the "Units")(1) of Key
Hospitality Acquisition Corporation (the "Company") as described in the
prospectus for the Offering (the "Prospectus"). Maxim is hereby inviting the
entity signatory hereto (the "Selected Dealer"), subject to the other terms and
conditions set forth herein and in the Prospectus, to act as a selected dealer
in connection with the Offering, and by executing this Selected Dealer Agreement
(this "Agreement"), Maxim hereby approves such signatory as a Selected Dealer in
connection with the Offering.
1. This Agreement shall be effective when the registration
statement relating to the Units (and including the Prospectus) (the
"Registration Statement") filed by the Company under the Securities Act of 1933,
as amended (the "Act"), has become effective with the Securities and Exchange
Commission. The terms of the Offering and the Selected Dealer's participation
therein are as follows:
Authorized Public Offering Price: $8.00 per Unit.
Selected Dealers' Selling Not to exceed $____ per Unit payable upon
Concession: termination of this Agreement, except as
provided below. Maxim reserves the right
not to pay such concessions on any of the
Units purchased by the Selected Dealer
from Maxim and repurchased by Maxim at or
below the price stated above prior to such
termination.
Reallowance: The Selected Dealer may reallow not in
excess of $___ per Unit as a selling
concession to dealers who are members in
good standing of National Association of
Securities Dealers, Inc. (the "NASD") or to
foreign dealers who are not eligible for
membership in the NASD and who have agreed:
(i) not to sell the Units within the United
States of America, its territories or
possessions or to persons who are citizens
thereof or residents therein, and (ii) to
abide by the applicable Conduct Rules of
the NASD.
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(1) Plus the over-allotment option available to the Underwriters to purchase up
to an additional 1,500,000 Units.
Delivery and Payment: Delivery of the Units shall be made on or
about ___________, 2005 or such later date
as Maxim may advise on not less than one
day's notice to the Selected Dealer, at
Maxim's principal office located at ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇ or at such other place as Maxim
may advise on not less than one day's
notice to the Selected Dealer. Payment for
the Units is to be made, against delivery,
at the authorized public offering price
stated above, or, if Maxim shall so advise,
at the authorized public offering price
less the dealers' selling concession stated
above, by a certified or official bank
check in New York Clearing House Funds or
wire transfer of immediately available
funds payable to the order of Maxim Group
LLC.
Termination: This Agreement shall terminate at the close
of business on the 45th day following the
effective date of the Registration
Statement (of which the enclosed Prospectus
forms a part), unless extended at Maxim's
discretion for a period or periods not to
exceed in the aggregate 30 additional days.
Maxim may terminate this Agreement, whether
or not extended, at any time and for any
reason, without notice. In addition, this
Agreement shall automatically terminate if
the Selected Dealer: (a) ceases to be a
member in good standing of the NASD, (b)
becomes subject to NASD suspension, or (c)
has its registration as a broker-dealer
under the Securities Exchange Act of 1934,
as amended (the "Exchange Act") is
terminated or suspended. Upon termination,
all rights and obligations under this
Agreement shall cease, except rights and
obligations accrued or unsatisfied at the
date of termination.
2. Any of the Units purchased by the Selected Dealer hereunder
are to be offered by the Selected Dealer to the public at the public offering
price, except as herein otherwise provided and except that a reallowance from
such public offering prices not in excess of the amount set forth on the first
page of this Agreement may be allowed as consideration for services rendered in
distribution to dealers that: (a) are actually engaged in the investment banking
or securities business; (b) execute the written agreement prescribed by Rule
2740 of the NASD Conduct Rules; and (c) are either members in good standing of
the NASD or foreign banks, dealers or institutions not eligible for membership
in the NASD that represent to the Selected Dealer that they will promptly
reoffer such Units at the public offering price and will abide by the conditions
set forth in paragraph 8 below.
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3. By its signature hereto, the Selected Dealer agrees that:
(a) upon effectiveness of the Registration Statement and receipt of the
Prospectus, to take up and pay for the number of Units allotted and confirmed to
the Selected Dealer by Maxim, (b) not to use any of the Units to reduce or cover
any short position of the Selected Dealer, (c) upon Maxim's request, to advise
Maxim of the number of Units purchased from Maxim remaining unsold by the
Selected Dealer and to resell to Maxim any or all of such unsold Units at the
public offering prices stated above, less all or such part of the concession
allowed the Selected Dealer as Maxim may determine, and (d) to make available a
copy of the Prospectus to all persons who on behalf of the Selected Dealer will
solicit orders for the Units prior to the making of such solicitations by such
persons. The Selected Dealer is not authorized to give any information or to
make any representations other than those contained in the Prospectus or any
supplements or amendments thereto.
4. As contemplated by Rule 15c2-8 under the Exchange, Maxim
agrees to mail a copy of the Prospectus to any person making a written request
therefor during the period referred to in the rules and regulations adopted
under the Exchange Act, the mailing to be made to the address given in the
request. The Selected Dealer confirms that it has received and reviewed the
Prospectus and delivered all preliminary prospectuses and revised preliminary
prospectuses, if any, required to be delivered under the provisions of Rule
15c2-8 and agrees to deliver all copies of the Prospectus required to be
delivered thereunder. The Selected Dealer acknowledges that Maxim has heretofore
delivered to the Selected Dealer such preliminary prospectuses as have been
required by the Selected Dealer, receipt of which is hereby acknowledged, and
will deliver reasonable quantities of additional prospectuses (any supplements
or amendments thereto) as may be reasonably requested by the Selected Dealer.
5. The Selected Dealer agrees that until termination of this
Agreement, the Selected Dealer will not make purchases or sales of the Units
except: (a) pursuant to this Agreement, (b) pursuant to written authorization
received from Maxim, or (c) in the ordinary course of business as broker or
agent for a customer pursuant to any unsolicited order.
6. The Units are offered by Maxim for delivery when, as and if
sold to, and accepted by, Maxim and subject to the terms herein and in the
Prospectus or any supplements or amendments thereto, to Maxim's right to vary
the concessions and terms of the Offering after their release for public sale,
to approval of counsel as to legal matters and to withdrawal, cancellation or
modification of the offer without notice.
7. Upon written application to Maxim, the Selected Dealer
shall be informed as to the jurisdictions under the securities or blue sky laws
of which Maxim believes the Units are eligible for sale, but Maxim assumes no
responsibility as to such eligibility or the right of the Selected Dealer or any
other selected dealers in the Offering to sell any of the Units in any
jurisdiction. Maxim has caused to be filed a Further State Notice relating to
such of the Units to be offered to the public in New York in the form required
by, and pursuant to, the provisions of Article 23A of the General Business Law
of the State of New York. Upon the completion of the Offering, the Selected
Dealer agrees to promptly furnish to Maxim, upon request, territorial
distribution reports setting forth each jurisdiction in which sales of the Units
were made by the Selected Dealer, the number of Units sold in such jurisdiction,
and any further information Maxim may request in order to permit Maxim to file
on a timely basis any report that Maxim, as the representative of the
Underwriters or manager of the selected dealers in the Offering, may be required
to file pursuant to the securities or blue sky laws of any jurisdiction.
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8. By its signature hereto, as a condition of the approval by
Maxim of the Selected Dealer as such, the Selected Dealer confirms that it is
either: (a) a member in good standing of the NASD and that it is currently
registered as a dealer under the Exchange Act or (b) a foreign dealer that has
agreed (i) not to sell the Units within the United States of America, its
territories or possessions or to persons who are citizens thereof or residents
therein, and (ii) to abide by the applicable Conduct Rules of the NASD. The
Selected Dealer hereby agrees to comply with the provisions of Rule 2810 of the
Rules of Fair Practice of the NASD. In addition, the Selected Dealer hereby
agrees to comply with the provisions of Rules 2710, 2420, 2730, 2740 and 2750 of
the Rules of Fair Practice of the NASD to the extent such sections are
applicable to the Selected Dealer's activities in connection with the Offering,
as well as all other applicable federal, state and foreign laws, rules and
regulations, including, without limitation, those relating to money laundering.
9. The Selected Dealer agrees that it shall act solely as an
independent contractor under this Agreement. Nothing herein shall be deemed to
create any partnership, joint venture or other association or entity between
Maxim and the Selected Dealers; provided, however, that the Selected Dealer
agrees, notwithstanding any prior settlement of accounts or termination of this
Agreement, to bear its proper proportion of any tax or other liability based
upon the claim that the selected dealers in the Offering constitute a
partnership, joint venture or other association or entity and a like share of
any expenses of resisting any such claim.
10. Maxim shall be the managing underwriter of the Offering
and the manager of all of the selected dealers of the Offering (including the
Selected Dealer) and shall have full authority to take such action as it may
deem advisable in respect of all matters pertaining to the Offering or such
selected dealers or any one of them. Except as expressly stated herein, or as
may arise under the Act, Maxim shall be under no liability to the Selected
Dealer as such for, or in respect of: (i) the validity or value of the Units,
(ii) the form of, or the statements contained in, the Prospectus, the
Registration Statement of which the Prospectus forms a part, any supplements or
amendments to the Prospectus or such Registration Statement, any preliminary
prospectus, any instruments executed by, or obtained or any supplemental sales
data or other letters from, the Company, or others, (iii) the form or validity
of the any underwriting agreement entered into in connection with the Offering,
or this Agreement, (iv) the eligibility of any of the Units for sale under the
laws of any jurisdiction, (v) the delivery of the Units, (vi) the performance by
the Company or others of any agreement on its or their part, or (vii) any matter
in connection with any of the foregoing.
11. If, for federal income tax purposes, should the Selected
Dealer and Maxim (together or with others), be deemed to constitute a
partnership, then the Selected Dealer elects to be excluded from the application
of Subchapter K, Chapter 1, Subtitle A of the Internal Revenue Code of 1986, as
amended, and the Selected Dealer agrees not to take any position inconsistent
with such election. The Selected Dealer authorizes Maxim, in its sole
discretion, to execute and file on the Selected Dealer's behalf, such evidence
of such election as may be required by the Internal Revenue Service.
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12. All communications from the Selected Dealer shall be
addressed to Maxim Group LLC, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇. Any notice from Maxim to the Selected
Dealer shall be deemed to have been fully authorized by the Underwriters and to
have been duly given if mailed or sent by confirmed facsimile transmittal to the
Selected Dealer at the address to which this Agreement is initial sent. This
Agreement shall be construed in accordance with the laws of the State of New
York without giving effect to conflict of laws. Time is of the essence in this
Agreement.
If you desire to become a Selected Dealer, please advise us to
that effect immediately by facsimile transmission and sign and return to us the
enclosed counterpart of this letter.
Very truly yours,
MAXIM GROUP LLC
By:
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Name:
Title:
We agree to act as a Selected Dealer in connection with the
Offering on the terms specified above.
Dated: , 2005
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(Selected Dealer)
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(Sign Here)
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(Print Signatory's Title)
