Initial Public Offering (IPO): Registration Statement (General Form) — Form S-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-1 S-1/ Common Stock - $10,822,500 95 448K
2: EX-1.1 Selling Group Agreement 7 43K
3: EX-3.1 Articles of Incorporation - Msh Entertainment 14 65K
4: EX-3.2 Bylaws - Msh Entertainment Corp. 6 32K
5: EX-4.1 Subscription Agreement 3 16K
6: EX-5.1 Opinion - Glenn Gearhart 2± 11K
7: EX-10.1 Employment Agreement - Msh & Robert Maerz 12 48K
16: EX-10.10 Cooperation Agreement - Msh & Happy Zone 16 61K
17: EX-10.11 Promissory Note - Msh & Robert Maerz 1 10K
18: EX-10.12 Promissory Note - Msh & Alfred Morgan 1 10K
19: EX-10.13 Promissory Note - Msh & Rick Seibold 1 10K
20: EX-10.14 Promissory Note - Msh & Jonathan Stathakis 1 10K
21: EX-10.15 Credit Agreement - Msh & Happy Zone 3 17K
8: EX-10.2 Employment Agreement - Msh & Jonathan Stathakis 12 48K
9: EX-10.3 Employment Agreement - Msh & Christopher Haigh 9 47K
10: EX-10.4 Employment Agreement - Msh & Fred Aurelio 10 43K
11: EX-10.5 Promissory Note - Christopher Haigh 2 14K
12: EX-10.6 Msh - 1996 Stock Option Plan 12 48K
13: EX-10.7 Credit Agreement - Msh & Robert Posner 5 25K
14: EX-10.8 Cooperation & Warrant Agreement - Msh & Intel 37 160K
15: EX-10.9 Production Agreement - Msh & Abrams/Gentle 19 75K
22: EX-27 Financial Data Schedule 2 10K
EX-1.1 — Selling Group Agreement
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EXHIBIT 1.1
MSH ENTERTAINMENT CORPORATION
Public Offering of
3,000,000 Shares of Common Stock
PARTICIPATING DEALER AGREEMENT
MSH Entertainment Corporation, a Utah corporation (the "Company),
invites your participation as a Participating Dealer ("Participating Dealer"),
in a public offering of a up to 3,000,000 shares of Common Stock, with a par
value of $0.001 (the "Common Stock"), of the Company, to be offered and sold to
the public at the price of $______ per share. All such shares of Common Stock
are sometimes referred to herein as the "Shares." The Shares are being offered
subject to the terms of this Agreement and such further instructions from the
Company as may be forwarded to the Participating Dealers from time to time.
The terms of the offering are more fully described in the enclosed
Prospectus, which has been filled with the Securities and Exchange Commission as
part of the Company's Registration Statement on Form S-1 (File No. 333-
__________) (the "Registration Statement"). This invitation is made by the
Company only if the Shares may be lawfully offered to dealers in the state(s) in
which the Participating Dealer is registered as a broker-dealer. The terms and
conditions of this invitation are as follows:
1. Acceptance of Orders. Orders received from the Participating Dealer will
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be accepted only at the price, in the amount, and on the terms which are set
forth in the Company's current Prospectus and this Agreement. As used herein,
term "Prospectus" means a prospectus which meets the requirements of Section 10
of the Securities Act of 1933, as amended ("Act"), with respect to the
securities which are the subject of this Agreement. The Company may, from time
to time, allocate Shares which each Participating Dealer may offer and sell
subject to the terms in the current Prospectus and this Agreement, and may
increase or decrease such allocation or withdraw such allocation whether or not
such Participating Dealer has confirmed transactions as a result of such
allocation. Such allocation represents the maximum number of Shares a
Participating Dealer may offer for sale. Each such allocation does not require
the Escrow Agent (defined in Paragraph 7 below) or the Company to accept any
transaction in its sole, unconditional discretion.
2. Selling Concession. As a Participating Dealer, you will be allowed, on
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all Shares sold by you, a concession (commission) of up to ten percent (10%) of
the total sales price as shown in the Company's current Prospectus.
3. Status of Dealer. The Participating Dealer agrees that it will act as
----------------
agent for the Company to sell the Shares to its customers only as authorized by
the Company. In all sales of the Shares to the public, the Participating Dealer
shall confirm as agent for the Company, and shall indicate thereon that the
transaction is subject to the terms and conditions of the Prospectus and the
Participating Dealers Agreement and may be rejected by the Company.
4. Special Limitation on Participating Dealer's Authority. The Participating
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Dealer agrees that it will make no sales to any accounts over which it exercises
discretionary authority.
5. Acceptance. The Participating Dealer will promptly transmit, in
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accordance with Rule 15c2-4 promulgated under the Securities Exchange Act of
1934, as amended, into the Account identified in Paragraph 7 hereof all funds
received from purchasers, a duplicate confirmation, a record of each sale which
sets forth the name, address, social security number of each individual
beneficial purchaser, the
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number of Shares purchased, and, if there is more than one registered owner,
whether the certificate or certificates evidencing the Shares are to be issued
to the purchasers in joint tenancy, tenancy in common, or otherwise.
6. Blue Sky Approval and Rejection of Sales. The Shares may be sold only in
----------------------------------------
the states of ______ . Each Participating Dealer shall report, in writing, to
the Company the number of the Shares which each has sold in each state and the
number of persons in each such state who purchased Shares through the
Participating Dealer. Each transaction may be rejected by the Company in its
unconditional discretion, and if rejected, the Company will return or will
instruct the Escrow Agent to return to the purchaser all funds paid by the
purchaser which have been received by the Escrow Agent or the Company. If such
funds should be returned to the Participating Dealer, the Participating Dealer
will return promptly to the purchaser, but in no event more than five business
days after actual receipt from the Company or the Escrow Agent, the full
purchase price paid by the purchaser.
7. Deposit of Proceeds. The proceeds from the sale of Shares sold on behalf
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of the Company in the offering will be provided to the Company. No certificates
evidencing the Shares will be issued and no sales will be completed unless and
until the sales funds have been deposited with the Company's designated
depository Agent, ____________________________, and such funds have cleared and
been released and the proceeds thereof delivered to the Company. The Company
will promptly transmit (within five business days after payment of the proceeds
to the Company) the commissions and the concessions allowed to the Participating
Dealers.
8. Payment. Payment for the Shares shall be delivered to the Company's
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depository Agent. All checks and other instruments for the payment of money
shall be in clearing house funds or certified and made payable (or endorsed by
Participating Dealers which have net capital of $25,000 or more) to "_________."
In addition, customer checks will be made payable to the Company's depository
Agent in accordance with Rule 15c2-4 of the Securities Exchange Act of 1934 and
customer funds will be transmitted to the Company's depository Agent by
Participating Dealers by noon of the next business day following their receipt
in accordance with Rule 15c2-4 of the Securities Exchange Act of 1934.
Certificates for the Shares sold by the Participating Dealer shall be available
for delivery at the Company's transfer agent, unless other arrangements are made
with the Company for delivery. Neither the Participating Dealer nor any
purchaser shall have the right to cancel any confirmed order, or to receive a
refund of any part of the proceeds deposited in the Company's depository
Account.
9. Participating Dealer's Undertakings. No person is authorized to give any
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information or to make any representations concerning the Company or the
offering of the Shares except those contained in the Company's then current
Prospectus. The Participating Dealer agrees to comply with the prospectus
delivery requirements of the Act. The Participating Dealer agrees not to use
any sales literature of any kind other than Prospectuses supplied by the Company
without prior written approval of the Company unless such sales literature is
furnished by the Company for such purpose. In offering and selling the Shares,
the Participating Dealer will rely solely on the representations contained in
the Company's current Prospectus. Additional copies of the then current
Prospectus will be supplied by the Company in reasonable quantities upon
request. The Participating Dealer understands that during the 60-day period
after the first date upon which the Shares of the Company are bona fide offered
to the public, all Participating Dealers effecting transactions in the Company's
Shares may be required to deliver the Company's Prospectus to any purchasers
thereof prior to or concurrent with the receipt of the confirmation of sale
(Rule 256).
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10. Conditions of Offering. All sales will be subject to delivery by the
----------------------
Company of certificates evidencing the Shares, which certificates will be issued
approximately five days after the close of the Offering Period. The Company
shall have full authority to take such action as it deems advisable in respect
of all matters pertaining to the offering or arising thereunder. The Company
shall incur no liabilities to the Participating Dealer except as may be incurred
under the Act, the Rules and Regulations thereunder, or for obligations assumed
in this Agreement.
11. Failure of Order. If a sale is rejected or if a payment is received
-----------------
which proves insufficient or worthless, any compensation paid to the
Participating Dealer shall be returned by the Participating Dealer's remittances
in cash.
12. Representations and Agreements of Dealer. The Participating Dealer
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represents and agrees that:
(i) it is registered as a broker-dealer under the Securities Exchange Act of
1934, as amended;
(ii) it is qualified to act as a dealer in the states or other jurisdictions
in which it offers the Shares;
(iii) its representatives are qualified to act as such in each of the states
and other jurisdictions in which they may so act in offering and selling the
Shares subject to this Agreement;
(iv) it is a member in good standing of the National Association of
Securities Dealers, Inc.; and
(v) it will maintain such registrations, qualifications and memberships
throughout the term of this Agreement and comply with all statutes and other
requirements applicable to it as a broker or dealer pursuant to those
registrations, qualifications and memberships.
Further, in offering and selling the Shares, the Participating Dealer agrees
to comply with all applicable federal laws, the laws of the states or other
jurisdictions concerned and the Bylaws, Rules and Interpretations of the
National Association of Securities Dealers, Inc. Further, the Participating
Dealer agrees that it will not offer or sell the Shares in any state or
jurisdiction, except those set forth in Paragraph 6 hereof, subject to such
Participating Dealer's and its representatives' qualification as represented
above. The Participating Dealer shall not be entitled to any compensation
hereunder during any period in which it has been suspended or expelled from
membership in the National Association of Securities Dealers, Inc.
The Participating Dealer represents and agrees that not less than 48 hours
prior to the time at which it expects to mail confirmations of sale of Shares it
will distribute copies of the then current preliminary or final Prospectus to
all persons to whom it then reasonably expects to mail such confirmations, in
substantially the manner described in Rule 15c2-4 under the Securities Exchange
Act of 1934.
The Participating Dealer represents and agrees that it has not previously bid
for or purchased any securities whatsoever of which the Company is or will be
the issuer and until the distribution to which this Agreement relates is
completed, it will not bid for or purchase or attempt to induce any other
persons to bid for or purchase any securities whatsoever of which the Company is
the issuer, other than transactions involving the initial sale of the Shares
subject to this Agreement.
The Participating Dealer agrees to comply with the provisions of Article III
of the Rules of Fair Practice as promulgated by the National Association of
securities Dealers, Inc., including without limitation, Sections 24, 8, 36 and
25 thereof.
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13. Dealer's Employees. The Participating Dealer agrees to assume full
------------------
responsibility for thorough and proper training and supervision of its
representatives concerning, among other things, the federal and state laws which
may be applicable, including the federal and state requirements for the
registration of the Shares, the uses to be made of the Prospectus, the
prohibitions on the use of other sales literature, the federal and state
requirements for broker-dealer registration of representatives, the truthful
disclosure to and fair dealing with prospective investors, the prohibitions
against false, misleading and unwarranted representations, opinions, promises
and predictions, the suitability of the investment by the prospective investors,
and the prohibitions contained in the National Association of Securities
Dealers, Inc.'s "Free Riding and Withholding" interpretation and all other
applicable laws, regulations, rulers, orders and interpretations. In addition,
the Participating Dealer shall bring to the attention of each of its
representatives the provisions of the Prospectus to the effect that any
representation or information other than the representations and information
contained therein are not authorized by the Company and the provisions of
Paragraph 9 hereof, and will supervise its representatives to assure compliance
with such provisions.
14. Company's Indemnification. The Company hereby agrees to indemnify,
-------------------------
defend and hold the Participating Dealer, and each person, if any, who controls
the Participating Dealer within the meaning of either Section 15 of the Act or
Section 20 of the Securities Exchange Act from and against any and all losses,
claims, damages, liabilities or expenses joint or several, (including reasonable
legal or other expenses incurred by each such person in connection with
defending or investigating any such claims or liabilities, whether or not
resulting in any liability to such person) which they or any of them may incur
under the Act, or any state securities law and the Rules and Regulations or the
rules and regulations under any state securities laws or any other statute or at
common law or otherwise incurred by any of them in connection with any
litigation (including the cost of any investigation and preparation), whether or
not resulting in any liability, but only insofar as such losses, claims,
damages, liabilities and litigation arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereto or any application or other
document filed in any state or other jurisdiction in order to register or
qualify the Shares under the securities laws thereof, or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, all as of the date when
the Registration Statement or such amendment, as the case may be, becomes
effective, or any untrue statement or alleged untrue statement of a material
fact contained in the Prospectus (as amended or supplemented if the Company
shall have filed with Commission any amendments thereof or supplements thereto),
or the omission or alleged omission to state therein a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that the indemnity
agreement contained in this Paragraph 14 shall not apply to amounts paid in
settlement of any such litigation if such settlements are effected without the
consent of the Company, nor shall it apply to the Participating Dealer or any
person controlling the Participating Dealer in respect of any such losses,
claims, damages, liabilities or actions arising or any such omission or alleged
omission, if such statement or omission was made in reliance upon information
and furnished in writing to the Company by such Participating Dealer
specifically for use in connection with the preparation of the Registration
Statement and Prospectus or any such amendment or supplement thereto. This
indemnity agreement is in addition to any other liability which the Company may
otherwise have to the Participating Dealer.
15. Notice. The Participating Dealer agrees to notify the Company promptly
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of the commencement of any litigation or proceeding against it or against any
such controlling person, of which it may be advised, in connection with the
offer and sale of any of the Shares and to furnish to the Company at its request
copies of all pleadings therein and permit the Company to be an observer therein
and apprise it of all the developments therein. In case of commencement of any
action in which indemnity may be sought
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from the Company on account of the indemnity agreement contained in Paragraph
14, the Participating Dealer agrees within a reasonable time after the receipt
by it of written notice of the commencement of any action against it or against
any person controlling it as aforesaid, to notify the Company in writing of the
commencement thereof. The omission of the Participating Dealer so to notify the
Company of any such action shall relieve the Company from any liability which it
may have to the Participating Dealer or any person controlling it. In case any
such action shall be brought against the Participating Dealer and the
Participating Dealer shall have notified the Company of the commencement
thereof, the Company shall be entitled to participate in the defense thereof at
its own expense, but such defense shall be conducted by counsel of recognized
standing and reasonably satisfactory to the Participating Dealer or such
controlling person or persons, defendant, or defendants in such litigation.
16. Participating Dealer's Indemnification. The Participating Dealer hereby
--------------------------------------
agrees in the same manner and to the same extent as set forth in Paragraph 14
above, to indemnify and hold harmless the Company, the directors of the Company
and each person, if any, who controls the Company within the meaning of either
Section 15 of the Act or Section 20 of the Securities Exchange Act with respect
to any statement in or omission from the Registration Statement or any amendment
thereto, or the Prospectus, or any amendment thereto, or any application or
other document filed in any state or other jurisdiction in order to register or
qualify the Shares under the securities law thereof, if such statements or
omissions were made in reliance upon information furnished in writing to the
Company by the Participating Dealer specifically for use in connection with the
preparation of the Registration Statement and Prospectus or any amendment or
supplement thereto, or with respect to any failure of the Participating Dealer
to deliver a Prospectus in accordance with the requirements of Section 5 of the
Act, or with respect to any untrue statement or alleged untrue statement of a
material fact made by the Participating Dealer or its agents not based on
statements in the Prospectus or authorized in writing by the Company, or with
respect to any misleading statement or alleged misleading statement made by the
Participating Dealer or its agents resulting from the omission of material facts
which misleading statement is not based upon the Prospectus, or information
furnished in writing by the Company. This indemnity agreement is in addition to
any other liability which the Participating Dealer may otherwise have to the
Company.
17. Notice. The Company agrees to notify the Participating Dealer promptly
------
of commencement of any litigation or proceedings against it or any of its
officers or directors, of which it may be advised, in connection with the offer
and sale of any of its Shares, to furnish to the Participating Dealer, at its
request, copies of all pleadings therein, and to permit the Participating Dealer
to be an observer therein and apprise the Participating Dealer of all
developments therein, all at the Company's expense. In case of commencement of
any action in which indemnity may be sought from the Participating Dealer on
account of the indemnity agreement contained in Paragraph 16, the Company shall
notify the Participating Dealer of the commencement thereof in writing within 10
days. The omission of the Company to so notify the Participating Dealer of any
such action shall relieve the Participating Dealer from any liability which it
may have to the Company or any persons controlling it on account of the
indemnity agreement contained in Paragraph 15.1 or otherwise. In case any such
action shall be brought against the Company and the Company shall have notified
the Participating Dealer of the commencement thereof, the Participating Dealer
shall be entitled to participate in the defense thereof at its own expense, but
such defense shall be conducted by counsel of recognized standing and reasonably
satisfactory to the Company or such controlling person or persons, defendant, or
defendants in such litigation. The Participating Dealer shall not be liable for
amounts paid in settlement of any litigation if such settlement was effected
without its consent.
18. Contribution. If the indemnification provided for in Paragraphs 14 and
-------------
15 is unavailable to an indemnified party in respect of any losses, claims,
damages or liabilities referred to therein, then each indemnifying party under
either such paragraph, in lieu of indemnifying such indemnified party
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thereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (I) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and by the Participating Dealers on the other hand from
the offering of the Shares or (ii) if the allocation provided by clause (I)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (I) above but
also the relative fault of the Company on the one hand and of the Participating
Dealers on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Participating Dealers on the other shall be
deemed to be in the same proportion as the total nets proceeds from the offering
(before deducting expenses) received by the Company bears to the total
underwriting discounts and commissions received by the Participating Dealers, as
in each case set forth in the table on the cover page of the Prospectus. The
relative fault of the Company on the one hand, and of the Participating Dealers
on the other hand, shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the Company
or by the Participating Dealers, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company and the Participating Dealers agree that it would not be just and
equitable if contribution pursuant to this Paragraph 16 were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages and liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Paragraph 16, no Participating Dealer
shall be required to contribute any amount in excess of the amount by which the
total price at which the Shares sold by it and distributed to the public exceeds
the amount of any damages which such Participating Dealer has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution
hereunder from any person who was not guilty of such fraudulent
misrepresentation.
19. Expenses. In addition to the compensation payable pursuant to Paragraph
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2 of this Agreement, the Company shall reimburse each Participating Dealer for
its accountable expenses for advertising, postage, travel and attendance at
Participating Dealers information meetings, in an amount equal to a maximum of 2
1/2% of the gross dollar amount of proceeds from the sale of Shares sold by such
Participating Dealer. Except as provided in Paragraph 16 hereof, no expenses
will be charged to Participating Dealers. A single transfer tax, if any, on the
sale of the Shares by the Participating Dealer to its customers will be paid by
the Participating Dealer when certificates representing such Shares are
delivered to the Participating Dealer for delivery to its customers. However,
the Participating Dealer will pay its proportionate share of any transfer tax or
any other tax (other than the single transfer tax described above) if any such
tax shall be from time to time assessed against the other Participating Dealer.
20. Controlling Law and Communications. This Agreement shall be construed
----------------------------------
according to the laws of the State of California. All communications to the
Company should be sent to the address shown in the opening paragraph of this
Agreement. Any notice to the Participating Dealer shall be properly given if
mailed or telephoned to the Participating Dealer at the address or to the
telephone number respectively given below.
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21. Assignment and Termination. This Agreement may not be assigned by the
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Participating Dealer without the Company's consent. This Agreement will
terminate, except as otherwise provided herein, upon the termination of the
offering of the Shares, except that either party may terminate this Agreement
at any time by giving written notice to the other.
22. Acceptance. This Agreement shall become binding upon acceptance by the
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Company of the Participating Dealer's offer to enter into this Agreement, which
offer is evidenced by the Participating Dealer signing this Agreement in the
space provided:
INFORMATION CONCERNING PARTICIPATING DEALER
Name:
-------------------------------------------------------------
Address:
-------------------------------------------------------------
Telephone:
IRS Employer Identification Number:
Share Allocation:
Signed by Participating Dealer on ________________________ __, 1997
By:
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Signature
-----------------------------
Print Name and Title
Accepted by MSH Entertainment Corporation on ________________ __, 1997.
By:
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