A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION BUT HAS NOT YET BECOME EFFECTIVE. NO OFFER TO
BUY THE SECURITIES CAN BE ACCEPTED AND NO PART OF THE PURCHASE PRICE CAN BE
RECEIVED UNTIL THE REGISTRATION STATEMENT HAS BECOME EFFECTIVE, AND ANY SUCH
OFFER MAY BE WITHDRAWN OR REVOKED, WITHOUT OBLIGATION OR COMMITMENT OF ANY KIND,
AT ANY TIME PRIOR TO NOTICE OF ITS ACCEPTANCE GIVEN AFTER THE EFFECTIVE DATE.
HARBOUR ENTERTAINMENT INC.
1,715,000 Shares of Common Stock
SELLING AGREEMENT
______________, 2000
Dear Sirs:
The undersigned, Russo Securities, Inc., as representative of the
underwriters (the "Representative"), has agreed, subject to the terms and
conditions of the Underwriting Agreement dated __________, 2000 (the
"Underwriting Agreement"), to use its best efforts to sell the securities issued
by Harbour Entertainment Inc., a Delaware corporation (the "Company"), of an
aggregate of up to 1,715,000 shares of common stock (the "Shares"), par value
$.001 per share, of the Company on a "best efforts" basis for a minimum of
$8,000,000 (the "Minimum Offering Price") and maximum of $12,000,000 (the
"Maximum Offering Price"), at the purchase price of $7.00, which is set forth on
the cover of the Prospectus. Selected Dealers will be allowed a commission of
nine percent (9%) and the number of warrants equal to ten percent (10%) of the
total amount of Shares sold by the individual Selected Dealers. Shares are more
particularly described in the enclosed prospectus (the "Prospectus"), additional
copies of which, as well as the Prospectus (after effective date), will be
supplied in reasonable quantities upon request.
We are offering a part of the Securities for sale to selected dealers (the
"Selected Dealers"), among which we are pleased to include you, at the public
offering price or at such price less a concession in the amount set forth in the
Prospectus under "Underwriting", as provided herein. This offering is made
subject to delivery of the Securities and its acceptance by us, to the approval
of all legal matters by counsel, and to the terms and conditions herein set
forth and may be made on the basis of the reservation of Securities or an
allotment against subscription.
We have advised you by telegram or telex of the method and terms of the
offering. Acceptances should be sent to Russo Securities Inc., 128 Sand Lane,
Staten Island, NY 10305, Attn: Fred Russo, President. We reserve the right to
reject any acceptance in whole or in part.
The Securities sold by you hereunder are to be offered by you to the public
at the public offering price, except as herein otherwise provided.
We, as Representative, may buy Securities from, or sell Securities to, any
Selected Dealer, and any Selected Dealer may buy Securities from, or sell
Securities to, any other Selected Dealer at the public offering price or at such
price less all or any part of the concession, as provided herein. We, as
Representative, after the initial public offering may change the public offering
price, the concession, and the reallowance.
Securities sold by you hereunder shall be paid for in full at the public
offering price or such price less the applicable concession, as we shall advise,
on such date as we shall determine, on one day's notice to you, by certified or
official bank check payable in New York Clearing House funds to the order of
Russo Securities, Inc., 128 Sand Lane, Staten Island, NY 10305 against delivery
of the Securities. If you are called upon to pay the public offering price for
the Securities sold by you, the applicable concession will be paid to you, less
any amounts charged to your account as provided herein, after termination of
this Agreement as it applies to the offering of the Securities. Notwithstanding
<PAGE>
the preceding two sentences, payment for and delivery of Securities sold by you
hereunder will be made at our option either by physical delivery of certificates
representing the shares so sold or through the facilities of The Depository
Trust Company if you are a member or, if you are not a member, settlement may be
made through a correspondent which is a member pursuant to instructions you may
send to us prior to such specified date.
We have been advised by the Company that a registration statement for the
Securities, filed under the Securities Act of 1933, as amended (the "Securities
Act"), has become effective. You agree (which agreement shall also be for the
benefit of the Company) that in selling Securities sold pursuant hereto you will
comply with the applicable requirements of the Securities Act and of the
Securities Exchange Act of 1934, as amended, (the "Exchange Act"). No person is
authorized by the Company or the Representative to give any information or to
make any representations not contained in the Prospectus, in connection with the
sale of Securities. You are not authorized to act as agent for the Company or
the Representative in offering Securities to the public or otherwise. Nothing
contained herein shall constitute the Selected Dealers partners with the
Representative or with one another.
Upon your application to us, we will inform you as to the advice we have
received from counsel concerning the jurisdictions under the respective "blue
sky" or securities laws of which it is believed that the Securities have been
qualified or registered or is exempt for offer and sale, but we have not assumed
and will not assume any responsibility or obligation as to the accuracy of such
information or as to the right of any Selected Dealers to offer or sell
Securities in any jurisdiction.
As Representative, we shall have full authority to take such action as we
may deem advisable in respect of all matters pertaining to the offering or
arising thereunder. We, acting as the Representative shall not be under any
obligation to you except for obligations expressly assumed by us in this
Agreement.
We are authorized to over-allot in arranging for sale of the Securities to
the Selected Dealers and to purchase and sell the Securities and shares of
Common Stock for long or short account and we are also authorized to stabilize
or maintain the market prices of the Common Stock.
You agree, from time to time until the termination of this Agreement, to
report to us the number of Securities sold by you pursuant to the provisions
hereof which then remain unsold and, on our request, you will resell to us any
such Securities remaining unsold at the purchase price thereof if, in our
opinion, such Securities are needed to make delivery against sales made to
others.
If prior to the termination of this Agreement as it applies to the offering
of the Securities (or prior to such earlier date as we have determined) we
purchase or contract to purchase in the open market or otherwise any Securities
or shares of Common Stock underlying the Securities which were sold by you from
us or from any other underwriter or dealer for reoffering (including any
Securities or shares of Common Stock which may have been issued on transfer or
in exchange for such Securities or shares of Common Stock), and which Securities
or shares of Common Stock were therefore not effectively placed for investment
by you, you authorize us either to charge your account with an amount equal to
the concession from the public offering price for which you purchased such
Securities, which shall be credited against the cost of such Securities, or to
require you to repurchase such Securities at a price equal to the total cost of
such purchase, including any commissions and transfer taxes on redelivery.
You agree that except with our consent and except as otherwise provided
herein, you will not, prior to termination of this Agreement or until we notify
you that you are released from this restriction, bid for, purchase, or sell,
directly or indirectly, any Securities or any shares of Common Stock (or, if
requested by us by telex or otherwise, any other securities of the Company) for
your account or for the accounts of customers except as broker or agent in the
execution of unsolicited brokerage orders therefor.
<PAGE>
As contemplated by Rule 15c2-8 under the Exchange Act, we agree to mail a
copy of the Prospectus to any person making a written request therefor during
the period referred to in Rule 15c2- 8, such mailing to be made to the address
given in the request. You confirm that you have delivered all preliminary
prospectuses and revised preliminary prospectuses, if any, required to be
delivered under the provisions of Rule 15c2-8 and agree to deliver all final
prospectuses and amendments or supplements thereto required to be delivered
under Rule 15c2-8. We have heretofore delivered to you such preliminary
prospectuses as have been requested by you, receipt of which is hereby
acknowledged, and will deliver such copies of the Prospectus as will be
requested by you.
Selected Dealers will be governed by the conditions herein set forth until
this Agreement is terminated. This Agreement will terminate at the close of
business on the 45th full day after the date hereof, but may be extended by us
for an additional period or periods not exceeding 45 full days in the aggregate.
Whether or not extended, we may, however, terminate this agreement or any
provision hereof at any time. Notwithstanding the termination of this Agreement,
you shall be and shall remain liable for, and will pay on demand, your
proportionate amount of any loss, liability, claim, or damage or related expense
which may be asserted against you alone, or against you together with other
dealers purchasing Securities upon the terms hereof, or against us, based upon
the claim that the Selected Dealers, or any of them, constitute an association,
unincorporated business, partnership, or separate entity.
All communications from you shall be addressed to Russo Securities, Inc.,
128 Sand Lane, Staten Island, NY 10305, Attn: Fred Russo, President. Any notice
from us to you shall be deemed to have been fully authorized by us and to have
been duly given if mailed, telegraphed, or telexed to you at the address to
which this letter is mailed. 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 agree to sell Securities in accordance with the terms hereof, kindly
confirm such agreement by completing and signing the form provided for that
purpose on the enclosed duplicate hereof and returning it to us promptly.
Very truly yours,
Russo Securities, Inc.
By: __________________________
Fred Russo
President
<PAGE>
Russo Securities, Inc.
128 Sand Lane
Staten Island, NY 10305
Dear Sirs:
We hereby confirm our agreement to sell the shares of Common Stock, par
value $.001 per share, of Harbour Entertainment, Inc. (the "Company") (the
"Common Stock"), allotted to us subject to the terms and conditions of the
foregoing Selling Agreement and your telegram or telex to us referred to
therein. We hereby acknowledge receipt of the definitive Prospectus relating to
the Common Stock, and we confirm that in purchasing and agreeing to use our best
efforts to sell the Common Stock we have relied upon no statements whatsoever,
written or oral, other than the statements in the Prospectus. We represent that
we are actually engaged in the investment banking or securities business and
that we are a member in good standing of the NASD which agrees to comply with
all applicable rules of the NASD or, if we are not such a member, we are a
foreign dealer or institution not eligible for membership in the NASD (a) which
agrees to make no offers or sales within the United States, it territories, or
its possessions or to persons who are citizens thereof or residents therein,
and, in making sales, to comply with the NASD's interpretation with respect to
Free-Riding and Withholding and Rules 2730, 2740 and 2750 of the NASD Conduct
Rules as if we were an NASD member and Rule 2420 as it applies to a nonmember
broker or dealer in a foreign country and (b) which in connection with offers
and sales of Common Stock made by us outside the United States (i) will either
furnish to each person to whom any such offer or sale is made a copy of the then
current preliminary prospectus or the Prospectus (as then amended or
supplemented if the Company shall have furnished amendments or supplements
thereto), as the case may be, or inform such person that such preliminary
prospectus or the Prospectus will be available upon request and (ii) will
furnish to each person to whom any such offer or sale is made such prospectus,
advertisement, or other offering document containing information relating to the
Common Stock, or the Company as may be required under the law of the
jurisdiction in which such offer or sale is made. Any prospectus, advertisement,
or other offering document furnished by us to any person in accordance with
clause (b)(ii) of the preceding sentence and any such additional offering
material as we may furnish to any person (c) shall comply in all respects with
the laws of the jurisdiction in which it is so furnished, (d) shall be prepared
and so furnished at our sole risk and expense, and (e) shall not contain
information relating to the Common Stock, or the Company which is inconsistent
in any respect with the information contained in the then current preliminary
prospectus or in the Prospectus (as then amended or supplemented if the Company
shall have furnished any amendments or supplements thereto), as the case may be.
It is understood that no action has been taken to permit a public offering in
any jurisdiction other than the United States where action would be required for
such purpose.
If for federal income tax purposes the Selected Dealers, among themselves
or with the Representative, should be deemed to constitute a partnership, then
we elect to be excluded from the application of Subchapter K, Chapter 1,
Subtitle A of the Internal Revenue Code of 1986, as amended, and we agree not to
take any position inconsistent with such election. We authorize you, in your
discretion, to execute and file on our behalf such evidence of such election as
may be required by the Internal Revenue Service.
-------------------------------
(Name of Selected Dealer)
--------------------------------
(Authorized Signature)
Dated: , 2000
