PROPOSED
SELECTED DEALER AGREEMENT
Dear Sirs:
Subject to the terms and conditions of the Underwriting Agreement with
__________________________________________, we have been employed to find
purchasers for an aggregate of 510,000 Units of Common Stock of Summa Metals
Corp., (the "Company") (on a best efforts, 130,000 Units or none basis), as to
the minimum offering, and on a best efforts basis thereafter up to 510,000
`Units, as more fully described in and subject to the conditions set forth in
the Prospectus contained in the Registration Statement on Form SB-2 under the
Securities Act of 1933 with respect to the `Units , which is effective. The
public offering price is $6.OO per Unit.
As Underwriters, we are offering to certain selected dealers who are
members in good standing of the National Association of Securities Dealers, Inc.
("NASD") (herein collectively called the "Selected Dealers") the right as set
forth herein to subscribe to a portion of the Shares at the public offering
price of $6.00 per Unit.., less a concession as set forth below and on the
following terms and conditions; provided, however, that no NASD member may
re-allow commissions to any non-member broker-dealer.
1. Terms and Allotment. We expressly reserve the right to accept or reject
in our discretion, either in whole, or in part, and to allot and over-allot. In
the case of over-allotment, we agree to accept subscriptions, up to the amount
of a Selected Dealer's Allotment, in the order of their receipt by us. If the
above-described offering is overallotted, we agree to notify you as soon as
practicable if we may not be able to fill orders for the entire number of Shares
indicated on your acceptance hereof.
2. Concessions. Except as may otherwise expressly be agreed, we agree to
allow a concession of $ per Share on all Shares confirmed by us. We reserve the
right to modify or change, but not decrease, the foregoing concessions, and
shall be under no obligation to allow the same concession to all Selected
Dealers. We reserve the right not to pay such concession on Shares purchased by
members from us and repurchased by us at or below the public offering price
prior to termination of this Agreement.
Subscribers will be permitted to purchase only whole number of Shares in
round lots as the Company will issue no fractional Shares.
3. Delivery and Payment. You will notify us in writing when you have
obtained subscriptions to the Shares allotted to you and have received the
purchase price therefor. All ` checks received in payment for the Shares shall
be payable to "▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, - Escrow Agent for Summa Metals Corp.". You
agree and covenant to transmit such subscriptions (if any) without deduction for
concessions promptly upon the receipt thereof, (but in any event by noon of the
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business day following receipt) for deposit directly to the escrow account of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, For the Benefit of Summa Metals Corp. at First National Bank
of Long Island, ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, where they will
be held until paid to the Company on the closing date, hereinafter specified or
until returned to the respective subscribers. Each transmittal of funds to the
escrow account must be accompanied by a transmittal letter specifying the total
amount transmitted and the name, address, tax I.D. number and number of Shares
purchased for each subscriber whose funds are being transmitted. A copy of such
letter must be sent to us at ___________________________________________________
_________________________________________. In the event that subscriptions for a
minimum of 130,000 Units are obtained, you will receive a notice from us to that
effect specifying a closing date on which delivery will be made to you of Units
purchased by you pursuant hereto against payment therefor at the public offering
price. The closing shall be held at the offices of _____________________ on such
closing date. In the event that a minimum of 130,000 Units are not sold prior to
___________, 19____ (90 days from the Effective Date) or the date 90 days
thereafter if we have notified you of such extension, you will be so notified,
and you covenant and agree, in such event, that all subscriptions received by
you (other than those subscriptions returned directly by the Escrow Agent) shall
be returned without charge and without interest to the respective subscribers
promptly upon receipt of notice from us. Delivery of certificates for Units
subscribed for by you and confirmed by us hereunder will take place at the
closing or as soon thereafter as practicable. Certificates delivered will be in
customer's names where practicable and the balance in street name and in
denominations of 1,000 Units,. Settlement for concessions payable will be made
as promptly as practicable after delivery of certificates. In the event that you
fail to make payment of an accepted subscription as above provided, we may, in
addition to any other remedies provided by law, cancel such subscription by
letter, telephone or telegraph notice to you.
4. Offering . Selected Dealers may immediately offer Units for sale and
take orders therefor, but only subject to confirmation. We, in turn, are
prepared to receive subscriptions and orders, subject, as set forth above, to
acceptance and allotment by us in whole or in part. Orders transmitted to us by
telephone should be confirmed by you by letter or telegram.
You agree to make a bona fide public offering of said Units but you will
not offer or sell any of such Units below the public offering price before the
termination of this Agreement.
You also agree to abide by all applicable provisions of the Securities Act
of 1933, as amended, the Securities Exchange Act of 1934, and the Rules and
Regulations under such Acts.
You agree, upon our request, at any time or times prior to the termination
of this Agreement to report to us as to the number of Units purchased by you
pursuant to the provisions hereof which then remain unsold and sell to us, for
our account, such portion of such unsold Units as we may designate, at the
public offering price less an amount to be determined by us not in excess of the
concession allowed to you.
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No expenses shall be charged to Selected Dealers; however, you shall pay
any transfer tax on sales of the Units by you and you shall pay your
proportionate share of any transfer tax or other tax in the event that any such
tax shall from time to time be assessed against you and other Selected Dealers
as a group or otherwise.
You further agree not to sell any of the Units - offered hereunder to any
officer, director, controlling stockholder, partner, employee or agent of your
organization, or member of the immediate family of any such person, except as
permitted under the Rules of Fair Practice of the National Association of
Securities Dealers, Inc., and the interpretations thereof.
5. Blue Sky. You agree to limit your offers and sales of the Units to the
following state in which you are qualified to act as a broker or dealer in
securities:
6. Termination. This Agreement shall terminate 90 days from the Effective
Date unless the offering is extended for an additional 90 days or unless sooner
terminated by us by notice to you for any reason.
You understand that the offering is being made on a 130,000 Units or none
best efforts basis, as to the minimum of 130,000 Units, by the Underwriter in
accordance with the terms of the Underwriting Agreement and will be terminated
in the event 130,000 Units, are not sold in accordance with the terms thereof.
In such event, none of the Units to be sold hereunder shall be issued or sold;
and you agree that in such case you will promptly return all funds received by
you and which you may be holding on account of proposed purchases of the Units
to the persons who tendered the same, without deduction. In the event of any
termination, the Underwriter shall have no responsibility to you.
Notwithstanding such termination, you may remain liable to the extent
provided by law for your proportionate amount of any claim, demand or liability
which may be asserted against you alone or against you together with other
Selected Dealers and/or us, based upon the claim that the Selected Dealers or
any of them and/or we constitute an association, an unincorporated business, or
any other separate entity.
7. `Use of Prospectus. Neither you nor any other person is authorized by
the Company or by us to give any information or make any representation other
than those contained in the Prospectus in connection with the sale of the Units
and, if given or made, such information or representation must not be relief
upon as having been authorized by the Company or us. You also agree to deliver a
copy of the Prospectus to each prospective purchaser as required by the
Securities Act and by the Rules and Regulations thereunder. Additional copies of
the Prospectus will be supplied in reasonable quantity upon request.
You are not authorized to act as our agent or as agent for the Company in
offering the Units to the public or otherwise. Nothing contained herein or
otherwise shall constitute Selected Dealers partners with us or with one
another.
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8. Underwriter's Authority. We shall have authority to take such action as
we deem advisable in respect of all matters pertaining to the offering or
arising hereunder. We and our agents shall be under no liability to you for or
in respect of the authorization, issue, full payment, non-assessability or
validity of the Units or the component securities thereof; for or in respect of
the form of, or the statements contained in or omitted from the Prospectus, the
Underwriting Agreement, or other instruments executed by the Company or by
others; for or in respect of the delivery of the Units or the performance by
the Company or by others of any agreement on its or their part; for or in
respect of the qualifications of the Units for sale under the laws of any
jurisdiction; or for or in respect of any other matter connected with this
Agreement, except agreements expressly assumed by us herein and for lack of good
faith. No obligations not expressly assumed herein shall be implied; provided
that nothing herein contained shall be deemed to deny, exclude or impair any
liability imposed upon us or our agents as an underwriter by state or federal
securities law.
9. Applicable Securities Laws. By accepting this offer to become a Selected
Dealer, you represent to the Underwriter that you are qualified under the
Securities Exchange Act of 1934 and the Blue Sky laws of any State in which you
offer the Shares, as a dealer or broker in securities, and that you are a member
in good standing of the National Association of Securities Dealers, Inc. ;
provided, however, that no NASD member may re-allow commission to any non-member
broker-dealer. Alternatively, this offer may be accepted by a foreign dealer not
eligible for membership in the NASD who agrees not to re-offer, resell or
deliver the Shares in, the United States or to persons to whom it has reason to
believe are citizens or residents of the United States and, in making sales, to
comply with NASD's Interpretation with Respect to Free-Riding and Withholding
and Sections 8, 24 and 36 of Articles III of the NASD's Rules of Fair Practice
as if such foreign dealer were an NASD member and Section 25 of such Article III
as it applies to a nonmember broker or dealer in a foreign country.
10. Communications. All communications from you to us should be addressed
to _____________________________________________________________________________
__________________________________. All communications from us and/or the
Company to you shall be deemed to have been duly given if mailed, telegraphed or
telephoned to you at the address to which this letter is mailed, unless written
notification shall be received from you of a change in address.
If you desire to become a Selected Dealer, please advise us immediately by
signing and returning to us the form of acceptance attached hereto.
Very truly yours,
By ________________________________
DATED________________________
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Dear Sirs:
We agree to become a Selected Dealer with respect to the offering of Units
of Common Stock of Summa Metals Corp. at the public offering price of $6.00 per
Unit as outlined in this Agreement, and we acknowledge receipt of the
Prospectus, dated ____________ 1998.
We agree to subscribe on the terms set forth in this Agreement for Units -
of Common Stock of Summa Metals Corp., as described in the Prospectus, and to
make payment for such securities within (10) days of the date of the
confirmation from you of our order, provided that funds received from our
customers on subscription for Shares shall be transmitted to the escrow account
of ▇▇▇▇▇▇ ▇,. ▇▇▇▇▇▇▇, for the benefit of Summa Metal Corp; at First National
Batik of Long Island in accordance with Rule 15c2-4.
We confirm, that we are a member in good standing of the National
Association of Securities Dealers, Inc., and we agree to abide by the "Rules of
Fair Practice" of the National Association of Securities Dealers, Inc., and the
interpretations thereof.
DATED _____________________
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Signature of Selected Dealer
Address:_______________________
_______________________________
Phone:_________________________
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