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Exhibit 2(k)(2)
Rev. 02/24/00
SUBSCRIPTION AGENT AGREEMENT
Date: __________
Mellon Investor Services, L.L.C.
85 Challenger Rd.
Ridgefield Park, NJ 07660
Attn: Reorganization Department
-------------------------
Gentlemen:
____________________, a ____________________ corporation (the "Company") is
making an offer to issue (the "Subscription Offer") to the holders of record of
its outstanding shares of Common Stock par value $__________ per share (the
"Common Stock"), at the close of business on __________ (the "Record Date"), the
right to subscribe for and purchase (each a "Right") shares of Common Stock (the
"Additional Common Stock") at a purchase price of __________ per share of
Additional Common Stock (the "Subscription Price"), payable by cashier's or
certified check, upon the terms and conditions set forth herein. The term
"Subscribed" shall mean submitted for purchase from the Company by a stockholder
in accordance with the terms of the Subscription Offer, and the term
"Subscription" shall mean any such submission. The Subscription Offer will
expire at __________, New York City Time, on ____________________ (the
"Expiration Time"), unless the Company shall have extended the period of time
for which the Subscription Offer is open, in which event the term "Expiration
Time" shall mean the latest time and date at which the Subscription Offer, as so
extended by the Company from time to time, shall expire.
The Company filed a Registration Statement relating to the Additional
Common Stock with the Securities and Exchange Commission under the Securities
Act of 1933, as amended, on ____________________. Said Registration Statement
was declared effective on ____________________. The terms of the Additional
Common Stock are more fully described in the Prospectus forming part of the
Registration Statement as it was declared effective, and the accompanying Letter
of Instruction. Copies of the Prospectus, the Letter of Instruction and the
Notice of Guaranteed Delivery are annexed hereto as Exhibit 1, Exhibit 2 and
Exhibit 3, respectively. All terms used and not defined herein shall have the
same meaning as in the Prospectus. Promptly after the Record Date, the Company
will provide you with a list of holders of Common Stock as of the Record Date
(the "Record Stockholders List").
The Rights are evidenced by transferable subscription warrants (the
"Warrants"), a copy of the form of which is annexed hereto as Exhibit 4. The
Warrants entitle the holders to subscribe, upon payment of the Subscription
Price, for shares of Additional Common Stock at the rate of __ share(s) for each
Right evidenced by a Warrant (the "Basic Subscription Privilege"). No
fractional shares will be issued, but the Subscription Offer includes a step-up
privilege entitling the holder of a Warrant or combination of Warrants
evidencing fewer than ___ Rights, or a total number of Rights not evenly
divisible by __________, if said holder fully exercises the Warrant or Warrants
accompanying the Subscription Offer, to subscribe and pay the Subscription Price
for one full share of Additional Common Stock in lieu of a fractional share
without furnishing
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any additional Rights (the "Step-up Privilege"). Rights which are sold will not
retain Step-up Privileges. Reference is made to the Prospectus for a complete
description of the Basic Subscription Privilege and the Step-up Privilege.
The Company hereby appoints you as Subscription Agent (the "Subscription
Agent") for the Subscription Offer and agrees with you as follows:
1) As Subscription Agent, you are authorized and directed to:
(A) Issue the Warrants in accordance with this Agreement in the names of
the holders of the Common Stock of record on the Record Date, keep such records
as are necessary for the purpose of recording such issuance, and furnish a copy
of such records to the Company. The Warrants may be signed on behalf of the
Subscription Agent by the manual or facsimile signature of a Vice President or
Assistant Vice President of the Subscription Agent, or by the manual signature
of any of its other authorized officers.
(B) Promptly after you receive the Record Stockholders List:
(a) mail or cause to be mailed, by first class mail, to each holder of
Common Stock of record on the Record Date whose address of record is within
the United States and Canada, (i) a Warrant evidencing the Rights to which
such stockholder is entitled under the Subscription Offer, (ii) a copy of
the Prospectus, (iii) a Letter of Instruction, (iv) a Notice of Guaranteed
Delivery and (v) a return envelope addressed to the Subscription Agent; and
(b) mail or cause to be mailed, by air mail, to each holder of Common Stock
of record on the Record Date whose address of record is outside the United
States and Canada, or is an A.P.O. or F.P.O. address (i) a copy of the
Prospectus, (ii) a Notice of Guaranteed Delivery and (iii) a Letter of
Instruction (different from the Letter of Instruction sent to stockholders
whose address of record is within the United States and Canada). You shall
refrain from mailing Warrants issuable to any holder of Common Stock of
record on the Record Date whose address of record is outside the United
States and Canada, or is an A.P.O. or F.P.O. address, and hold such
Warrants for the account of such stockholder subject to such stockholder
making satisfactory arrangements with the Subscription Agent for the
exercise or other disposition of the Rights evidenced thereby, and follow
the instructions of such stockholder for the exercise, sale or other
disposition of such Rights if such instructions are received at or before
11:00 a.m., New York City Time, on .
(C) Mail or deliver a copy of the Prospectus (i) to each assignee or
transferee of Warrants upon your receiving appropriate documents to register the
assignment or transfer thereof and (ii) with certificates for shares of
Additional Common Stock when such are issued to persons other than the
registered holder of the Warrant.
(D) Accept Subscriptions upon the due exercise (including payment of the
Subscription Price) on or prior to the Expiration Time of Rights in accordance
with the terms of the Warrants and the Prospectus.
(E) Subject to the next sentence, accept Subscriptions from stockholders
whose Warrants are alleged to have been lost, stolen or destroyed upon receipt
by you of an affidavit of theft, loss or destruction and a bond of indemnity in
form and substance satisfactory to you, accompanied by payment of the
Subscription Price for the total number of shares of Additional Common Stock
Subscribed for. Upon receipt of such affidavit and bond of indemnity and
compliance with any other applicable requirements, stop orders shall be placed
on said Warrants
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and you shall withhold delivery of the shares of Additional Common Stock
Subscribed for until after the Warrants have expired and it has been determined
that the Rights evidenced by the Warrants have not otherwise been purported to
have been exercised or otherwise surrendered.
(F) Accept Subscriptions, without further authorization or direction from
the Company, without procuring supporting legal papers or other proof of
authority to sign (including without limitation proof of appointment of a
fiduciary or other person acting in a representative capacity), and without
signatures of co-fiduciaries, co-representatives or any other person:
(a) if the Warrant is registered in the name of a fiduciary and is executed
by and the Additional Common Stock is to be issued in the name of such
fiduciary;
(b) if the Warrant is registered in the name of joint tenants and is
executed by one of the joint tenants, provided the certificate representing
the Additional Common Stock is issued in the names of, and is to be
delivered to, such joint tenants;
(c) if the Warrant is registered in the name of a corporation and is
executed by a person in a manner which appears or purports to be done in
the capacity of an officer, or agent thereof, provided the Additional
Common Stock is to be issued in the name of such corporation; or
(d) if the Warrant is registered in the name of an individual and is
executed by a person purporting to act as such individual's executor,
administrator or personal representative, provided, the Additional Common
Stock is to be registered in the name of the subscriber as executor or
administrator of the estate of the deceased registered holder and there is
no evidence indicating the subscriber is not the duly authorized
representative that he purports to be.
(G) Accept Subscriptions not accompanied by Warrants if submitted by a firm
having membership in the New York Stock Exchange or another national securities
exchange or by a commercial bank or trust company having an office in the United
States together with the Notice of Guaranteed Delivery and accompanied by proper
payment for the total number of shares of Additional Common Stock Subscribed
for.
(H) Accept Subscriptions even though unaccompanied by Warrants, under the
circumstances and in compliance with the terms and conditions set forth in the
Prospectus under the heading "SUBSCRIPTION OFFER - Method of Exercising Rights".
(I) Refer to the Company for specific instructions as to acceptance or
rejection, Subscriptions received after the Expiration Time, Subscriptions not
authorized to be accepted pursuant to this Paragraph 1, and Subscriptions
otherwise failing to comply with the requirements of the Prospectus and the
terms and conditions of the Warrants.
(J) Upon acceptance of a Subscription:
(a) hold all monies received in a special account for the benefit of the
Company. Promptly following the Expiration Time you shall distribute to
the Company the funds in such account and issue certificates for shares of
Additional Common Stock issuable with respect to Subscriptions which have
been accepted.
(b) advise the Company daily by telecopy and confirm by letter
[to the attention of ] (the "Company Representative"),
with copies to [Underwriter, Address and Attention Party] as to
the total number of shares of Additional Common Stock Subscribed for, total
number of Rights sold, total number of Rights
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partially Subscribed for and the amount of funds received, with cumulative
totals for each; and in addition advise the Company Representative, by
telephone [telephone number], confirmed by telecopy, of the amount
of funds received identified in accordance with (a) above, deposited,
available or transferred in accordance with (a) above, with cumulative
totals; and
(c) as promptly as possible but in any event on or before 3:30 p.m., New
York City Time, on the first full business day following the Expiration
Time, advise the Company Representative in accordance with (b) above of the
number of shares Subscribed for, the number of Subscription guarantees
received and the number of shares of Additional Common Stock unsubscribed
for.
(K) Upon completion of the Subscription Offer, you shall requisition
certificates from the Transfer Agent for the Common Stock for shares of
Additional Common Stock Subscribed for.
2) (a) The Warrants shall be issued in registered form only. The Company
shall appoint and have in office at all times a Transfer Agent and Registrar for
the Warrants, satisfactory to you, which shall keep books and records of the
registration and transfers and exchanges of Warrants (such books and records are
hereinafter called the "Warrant Register"). The Company shall promptly notify
the Transfer Agent and Registrar of the exercise of any Warrants. The Company
shall promptly notify you of any change in the Transfer Agent and Registrar of
the Warrants.
(b) All Warrants issued upon any registration of transfer or exchange
of Warrants shall be the valid obligations of the Company, evidencing
the same obligations, and entitled to the same benefits under this
Agreement, as the Warrants surrendered for such registration of
transfer or exchange.
(c) Any Warrant when duly endorsed in blank shall be deemed
negotiable, and when a Warrant shall have been so endorsed the holder
thereof may be treated by the Company, you and all other persons
dealing therewith as the absolute owner thereof for any purpose and as
the person entitled to exercise the rights represented thereby, any
notice to the contrary notwithstanding, but until such transfer is
registered in the Warrant Register, the Company and you may treat the
registered holder thereof as the owner for all purposes.
3) You will follow your regular procedures to attempt to reconcile any
discrepancies between the number of shares of Additional Common Stock that any
Warrant may indicate are to be issued to a stockholder and the number that the
Record Stockholders List indicates may be issued to such stockholder. In any
instance where you cannot reconcile such discrepancies by following such
procedures, you will consult with the Company for instructions as to the number
of shares of Additional Common Stock, if any, you are authorized to issue. In
the absence of such instructions, you are authorized not to issue any shares of
Additional Common Stock to such stockholder.
4) You will examine the Warrants received by you as Subscription Agent to
ascertain whether they appear to you to have been completed and executed in
accordance with the applicable Letter of Instruction. In the event you
determine that any Warrant does not appear to you to have been properly
completed or executed, or where the Warrants do not appear to you to be in
proper form for Subscription, or any other irregularity in connection with the
Subscription appears to you to exist, you will follow, where possible, your
regular procedures to attempt to cause such irregularity to be corrected. You
are not authorized to waive any irregularity in connection with the
Subscription, unless you shall have received from the Company the Warrant
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which was delivered, duly dated and signed by an authorized officer of the
Company, indicating that any irregularity in such Warrant has been cured or
waived and that such Warrant has been accepted by the Company. If any such
irregularity is neither corrected nor waived, you will return to the subscribing
stockholder (at your option by either first class mail under a blanket surety
bond or insurance protecting you and the Company from losses or liabilities
arising out of the non-receipt or nondelivery of Warrants or by registered mail
insured separately for the value of such Warrants) to such stockholder's address
as set forth in the Subscription any Warrants surrendered in connection
therewith and any other documents received with such Warrants, and a letter of
notice to be furnished by the Company explaining the reasons for the return of
the Warrants and other documents.
5) Each document received by you relating to your duties hereunder shall
be dated and time stamped when received.
6) (a) For so long as this Agreement shall be in effect, the Company will
reserve for issuance and keep available free from preemptive rights a sufficient
number of shares of Additional Common Stock to permit the exercise in full of
all Rights issued pursuant to the Subscription Offer. Subject to the terms and
conditions of this Agreement, you will request the Transfer Agent for the Common
Stock to issue certificates evidencing the appropriate number of shares of
Additional Common Stock as required from time to time in order to effectuate the
Subscriptions.
(b) The Company shall take any and all action, including without
limitation obtaining the authorization, consent, lack of objection,
registration or approval of any governmental authority, or the taking
of any other action under the laws of the United States of America or
any political subdivision thereof, to insure that all shares of
Additional Common Stock issuable upon the exercise of the Warrants at
the time of delivery of the certificates therefor (subject to payment
of the Subscription Price) will be duly and validly issued and fully
paid and nonassessable shares of Common Stock, free from all preemptive
rights and taxes, liens, charges and security interests created by or
imposed upon the Company with respect thereto.
(c) The Company shall from time to time take all action necessary or
appropriate to obtain and keep effective all registrations, permits,
consents and approvals of the Securities and Exchange Commission and
any other governmental agency or authority and make such filings under
Federal and state laws which may be necessary or appropriate in
connection with the issuance, sale, transfer and delivery of Warrants
or Additional Common Stock issued upon exercise of Warrants.
7) If certificates representing shares of Additional Common Stock are to
be delivered by you to a person other than the person in whose name a
surrendered Warrant is registered, you will issue no certificate for Additional
Common Stock until the Warrant so surrendered has been properly endorsed (or
otherwise put in proper form for transfer) and the person requesting such
exchange has paid any transfer or other taxes or governmental charges required
by reason of the issuance of a certificate for Additional Common Stock in a name
other than that of the registered holder of the Warrant surrendered, or has
established to your satisfaction that any such tax or charge either has been
paid or is not payable.
8) Should any issue arise regarding federal income tax reporting or
withholding, you will take such action as the Company instructs you in writing.
9) The Company may terminate this Agreement at any time by so notifying
you in writing. You may terminate this Agreement upon 30 days' prior notice to
the Company. Upon
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any such termination, you shall be relieved and discharged of any further
responsibilities with respect to your duties hereunder. Upon payment of all your
outstanding fees and expenses, you will forward to the Company or its designee
promptly any Warrant or other document relating to your duties hereunder that
you may receive after your appointment has so terminated. Sections 11, 12, and
14 of this Agreement shall survive any termination of this Agreement.
10) As agent for the Company hereunder you:
(a) shall have no duties or obligations other than those specifically set
forth herein or as may subsequently be agreed to in writing by you and the
Company;
(b) shall have no obligation to issue any shares of Additional Common Stock
unless the Company shall have provided a sufficient number of certificates
for such Additional Common Stock;
(c) shall be regarded as making no representations and having no
responsibilities as to the validity, sufficiency, value, or genuineness of
any Warrants surrendered to you hereunder or shares of Additional
Common Stock issued in exchange therefor, and will not be required to or be
responsible for and will make no representations as to, the validity,
sufficiency, value or genuineness of the Subscription Offer;
(d) shall not be obligated to take any legal action hereunder; if, however,
you determine to take any legal action hereunder, and where the taking of
such action might, in your judgment, subject or expose you to any expense
or liability you shall not be required to act unless you shall have been
furnished with an indemnity satisfactory to you;
(e) may rely on and shall be fully authorized and protected in acting or
failing to act upon any certificate, instrument, opinion, notice, letter,
telegram, telex, facsimile transmission or other document or security
delivered to you and believed by you to be genuine and to have been signed
by the proper party or parties;
(f) shall not be liable or responsible for any recital or statement
contained in the Prospectus or any other documents relating thereto;
(g) shall not be liable or responsible for any failure on the part of the
Company to comply with any of its covenants and obligations relating to the
Subscription Offer, including without limitation obligations under
applicable securities laws;
(h) may rely on and shall be fully authorized and protected in acting or
failing to act upon the written, telephonic or oral instructions with
respect to any matter relating to you acting as Subscription Agent covered
by this Agreement (or supplementing or qualifying any such actions) of
officers of the Company;
(i) may consult with counsel satisfactory to you, including [insert the
name of your in-house counsel], and the advice of such counsel shall be
full and complete authorization and protection in respect of any action
taken, suffered, or omitted by you hereunder in good faith and in
accordance with the advice of such counsel;
(j) may perform any of your duties hereunder either directly or by or
through agents or attorneys and you shall not be liable or responsible for
any misconduct or negligence on the part of any agent or attorney appointed
with reasonable care by you hereunder; and
(k) are not authorized, and shall have no obligation, to pay any brokers,
dealers, or soliciting fees to any person.
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11) In the event any question or dispute arises with respect to the proper
interpretation of the Subscription Offer or your duties hereunder or the rights
of the Company or of any stockholders surrendering Warrants pursuant to the
Subscription Offer, you shall not be required to act and shall not be held
liable or responsible for your refusal to act until the question or dispute has
been judicially settled (and, if appropriate, you may file a suit in
interpleader or for a declaratory judgment for such purpose) by final judgment
rendered by a court of competent jurisdiction, binding on all parties interested
in the matter which is no longer subject to review or appeal, or settled by a
written document in form and substance satisfactory to you and executed by the
Company and each such stockholder and party. In addition, you may require for
such purpose, but shall not be obligated to require, the execution of such
written settlement by all the stockholders and all other parties that may have
an interest in the settlement.
12) Any instructions given to you orally, as permitted by any provision of
this Agreement, shall be confirmed in writing by the Company as soon as
practicable. You shall not be liable or responsible and shall be fully
authorized and protected for acting, or failing to act, in accordance with any
oral instructions which do not conform with the written confirmation received in
accordance with this Section.
13) Whether or not any Warrants are surrendered to you, for your services
as Subscription Agent hereunder, the Company shall pay to you compensation in
accordance with the fee schedule attached as Exhibit A hereto, together with
reimbursement for out-of-pocket expenses, including reasonable fees and
disbursements of counsel.
14) (a) The Company covenants to indemnify and hold you harmless from and
against any loss, liability, claim or expense ("Loss") arising out of or in
connection with your duties under this Agreement, including the costs and
expenses of defending yourself against any Loss, unless such Loss shall have
been determined by a court of competent jurisdiction to be a result of your
gross negligence or intentional misconduct. Anything in this agreement to the
contrary notwithstanding, in no event shall you be liable for special, indirect,
incidental or consequential loss or damage of any kind whatsoever (including but
not limited to lost profits), even if you have been advised of the likelihood of
such damages and regardless of the form of action. Any liability of yours will
be limited to the amount of fees paid by Client hereunder.
(b) In the event any question or dispute arises with respect to the
proper interpretation of this Agreement or your duties hereunder or the
rights of the Company or of any stockholders surrendering certificates
for Shares pursuant to the Offer, you shall not be required to act and
shall not be held liable or responsible for your refusal to act until
the question or dispute has been judicially settled (and you may, if
you in your sole discretion deem it advisable, but shall not be
obligated to, file a suit in interpleader or for a declaratory judgment
for such purpose) by final judgment rendered by a court of competent
jurisdiction, binding on all stockholders and parties interested in the
matter which is no longer subject to review or appeal, or settled by a
written document in form and substance satisfactory to you and executed
by the Company and each such stockholder and party. In addition, you
may require for such purpose, but shall not be obligated to require,
the execution of such written settlement by all the stockholders and
all other parties that may have an interest in the settlement.
The obligations of Company under this section shall survive the termination
of this Agreement.
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15) If any provision of this Agreement shall be held illegal, invalid, or
unenforceable by any court, this Agreement shall be construed and enforced as if
such provision had not been contained herein and shall be deemed an Agreement
among us to the full extent permitted by applicable law.
16) The Company represents and warrants that (a) it is duly incorporated,
validly existing and in good standing under the laws of its jurisdiction of
incorporation, (b) the making and consummation of the Subscription Offer and the
execution, delivery and performance of all transactions contemplated thereby
(including without limitation this Agreement) have been duly authorized by all
necessary corporate action and will not result in a breach of or constitute a
default under the certificate of incorporation or bylaws of the Company or any
indenture, agreement or instrument to which it is a party or is bound, (c) this
Agreement has been duly executed and delivered by the Company and constitutes
the legal, valid, binding and enforceable obligation of it, (d) the Subscription
Offer will comply in all material respects with all applicable requirements of
law and (e) to the best of its knowledge, there is no litigation pending or
threatened as of the date hereof in connection with the Subscription Offer.
17) In the event that any claim of inconsistency between this Agreement and
the terms of the Subscription Offer arise, as they may from time to time be
amended, the terms of the Subscription Offer shall control, except with respect
to the duties, liabilities and rights, including compensation and
indemnification of you as Subscription Agent, which shall be controlled by the
terms of this Agreement.
18) Set forth in Exhibit B hereto is a list of the names and specimen
signatures of the persons authorized to act for the Company under this
Agreement. The Secretary of the Company shall, from time to time, certify to
you the names and signatures of any other persons authorized to act for the
Company under this Agreement.
19) Except as expressly set forth elsewhere in this Agreement, all notices,
instructions and communications under this Agreement shall be in writing, shall
be effective upon receipt and shall be addressed, if to the Company, to its
address set forth beneath its signature to this Agreement, or, if to the
Subscription Agent, to Mellon Investor Services, L.L.C., 450 West 33rd Street,
New York, New York 10001, Attention: Reorganization Department, or to such
other address as a party hereto shall notify the other parties.
20) This Agreement shall be governed by and construed in accordance with
the laws of the State of New York, without giving effect to conflict of laws
rules or principles, and shall inure to the benefit of and be binding upon the
successors and assigns of the parties hereto; provided that this Agreement may
not be assigned by any party without the prior written consent of all other
parties.
21) No provision of this Agreement may be amended, modified or waived,
except in a written document signed by both parties.
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Please acknowledge receipt of this letter and confirm your agreement
concerning your appointment as Subscription Agent, and the arrangements herein
provided, by signing and returning the enclosed copy hereof, whereupon this
Agreement and your acceptance of the terms and conditions herein provided shall
constitute a binding Agreement between us.
Very truly yours,
(Company)
By: _________________________
Name:
Title:
Address for notices:
Accepted as of the date
above first written:
MELLON INVESTOR SERVICES, L.L.C.,
AS SUBSCRIPTION AGENT
By: _____________________________
Name:
Title:
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Exhibit 1 Prospectus
Exhibit 2 Letter of Instruction
Exhibit 3 Notice of Guaranteed Delivery
Exhibit 4 Form of Warrant
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EXHIBIT A
MELLON INVESTOR SERVICES, L.L.C.
Schedule of Fees as Subscription Agent
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<TABLE>
<CAPTION>
<S> <C> <C>
I. Set Up and Administrative Fee $ 7,500.00
II. Processing Basic subscriptions, each $ 14.00
III. Transferring subscription certificates, split-ups, reissuing new
certificates, round-ups, each $ 10.00
IV. Issuing subscription certificates to record date holders, each
and follow-up mailings $ 5.00
V. Processing oversubscriptions, including proration and refunds, each $ 10.00
VI. Sale of Rights for holders, each $ 10.00
VII. Subscriptions requiring additional handling (window items,
defective presentations, correspondence items, legal items,
and items not providing a taxpayer identification number), each $ 10.00
VIII. Processing Guarantee of Delivery items, each $ 10.00
IX. Handling Soliciting Dealer payments, each By Appraisal
X. Special Services By Appraisal
XI. Out-of-pocket Expenses (including but not limited to
postage, stationary, telephones, overnight couriers,
messengers, overtime, dinners, transportation, shipping
and trucking, mailing costs) Additional
XII. Minimum Fee $25,000.00
</TABLE>
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EXHIBIT B
[Company Letterhead]
Name Position Specimen Signatures
---- -------- -------------------
