Exhibit 1.1
SECOND AMENDED AND RESTATED
SELLING AGREEMENT
CITIGROUP DIVERSIFIED FUTURES FUND
L.P.
2,000,000 Units of Limited Partnership
Interest
AGREEMENT made as of the
day of
,
2004, by and among CITIGROUP DIVERSIFIED FUTURES FUND L.P., a New
York limited partnership (the “Partnership”), CITIGROUP
MANAGED FUTURES LLC, a Delaware limited liability company
(“CMF”) and CITIGROUP GLOBAL MARKETS INC., a New York
corporation (“CGM”).
W
I T
N E S S
E T H
:
WHEREAS, the Partnership has filed a
registration statement on Form S-1 (File No.
333- )
with the Securities and Exchange Commission (the “SEC”)
in accordance with the provisions of the Securities Act of 1933, as
amended, and the rules and regulations thereunder (collectively,
the “Act”), and as a part thereof a form of preliminary
prospectus relating to the offer and sale of up to 2,000,000 Units
of Limited Partnership Interest in the Partnership (the
“Units”) (the registration statement in the form in
which it becomes effective under the Act being hereinafter referred
to as the “Registration Statement” and the prospectus
in the form included therein being hereinafter referred to as the
“Prospectus”; provided that (i) if the Partnership
files a post-effective amendment to such registration statement,
then the term “Registration Statement” shall refer to
the registration statement as amended by such post-effective
amendment, and the term “Prospectus” shall refer to the
amended prospectus then on file with the SEC and (ii) if a
prospectus filed by the Partnership pursuant to either Rule 424(b)
or (c) promulgated under the Act shall differ from the prospectus
on file at the time the Registration Statement or any
post-effective amendment thereof shall have become effective, the
term “Prospectus” shall refer to the prospectus filed
pursuant to Rule 424(b) or (c), from and after the date on which it
shall have been filed); and
WHEREAS, consistent with SEC Rule
429, the Registration Statement relates to Units covered by prior
Registration Statement 333-110076; and
WHEREAS, the Partnership has entered
into management agreements with each of Aspect Capital Limited,
Capital Fund Management SA, Drury Capital, Inc., Graham Capital
Management, L.P., John W. Henry & Company, Inc. and
Willowbridge Associates Inc. (each an “Advisor,”
collectively, the “Advisors”) and CMF, pursuant to
which commodity trading decisions will be made by the Advisors as
described in the Prospectus; and
WHEREAS, CMF, the Partnership and
CGM entered into a Selling Agreement dated as of February 12, 2003,
as amended and restated in its entirety by that certain Amended and
Restated Selling Agreement, dated as of November 11, 2003 (the
“Amended and Restated Selling Agreement”) in order to
set forth the terms and conditions upon which CGM agreed to assist
in the offer and sale of the Units upon the terms and in reliance
upon the representations, warranties and agreements set forth in
the Amended and Restated Selling Agreement; and
WHEREAS, CMF, the Partnership and
CGM wish to amend and restate the Amended and Restated Selling
Agreement in its entirety upon the terms and in reliance upon the
representations, warranties and agreements set forth
herein;
NOW, THEREFORE, the parties hereto
agree as follows:
1. Appointment of Selling Agent;
Money Laundering Prevention
(a) The Partnership hereby appoints
CGM as its exclusive agent to offer and sell the Units on the terms
and conditions set forth herein and in the Registration Statement
and the Prospectus during the offering period (the “Offering
Period”), a period commencing on the date the Registration
Statement is declared effective by the SEC and ending upon the
earlier of the date two years from the date the Registration
Statement is declared effective and the date on which 2,000,000
Units are sold, unless CMF, the general partner of the Partnership,
terminates the offering at an earlier date.
(b) CGM hereby accepts appointment
as selling agent for the Partnership to effect sales of up to
2,000,000 Units as provided herein, in the Registration Statement
and in the Prospectus. CGM represents and hereby confirms that in
selling to subscribers and otherwise carrying out its obligations
under this agreement it will comply with Paragraphs (b)(2) and
(b)(3) of Rule 2810 of the Conduct Rules of NASD, Inc., as set
forth in Schedule I hereto. CGM agrees that CMF has the right to
reject any subscription for Units for any reason and to suspend
sales of Units during the Offering Period.
(c) The Partnership agrees to bear
all expenses in connection with the Offering Period including,
without limitation, fees and expenses of its counsel, SEC and other
filing fees, blue sky fees and expenses, printing expenses, fees
and expenses of independent public accountants and escrow
fees.
(d) CGM agrees that all funds
received by CGM from subscribers shall be promptly delivered to
JPMorgan Chase Bank as escrow agent for the benefit of the
subscribers (the “Escrow Agent”) by noon of the second
business day after receipt. Furthermore, CGM will require all
soliciting dealers to forward to CGM, for delivery to the Escrow
Agent, all checks received by them from subscribers for Units by
noon of the next business day after their receipt of the checks.
CGM represents and hereby confirms that if it receives checks from
customers it will act as processing broker-dealer in accordance
with Rule 15c2-4 under the Securities Exchange Act of 1934, as
amended, and NASD Notices to Members 84-7 and 84-64.
(e) CGM represents and confirms that
it is registered with the Commodity Futures Trading Commission
(“CFTC”) as a futures commission merchant and is a
member of the National Futures Association (“NFA”) in
that capacity. Further, any associated person of CGM who receives
continuing compensation in the form of a portion of the commodity
brokerage fees paid by the Partnership shall be registered with the
CFTC as an associated person of a futures commission merchant or an
introducing broker and shall be an associate member of the NFA
(qualified as an associated person by having taken the Series 3 or
Series 31 Commodities Exam or having been
“grandfathered” as an associated person qualified to do
commodity brokerage).
-2-
(f) CGM represents and confirms that
it is in compliance with applicable anti-money laundering laws
(including the USA Patriot Act) and related regulations and agrees
that it shall be responsible for compliance with such laws and
regulations with respect to purchasers of Units.
2. Agreements of the
Partnership . The Partnership agrees with CGM as
follows:
(a) The Partnership will advise CGM,
promptly after it receives notice thereof, (i) of the time when the
Registration Statement has become effective and when any amendment
thereto becomes effective, (ii) of the issuance by the SEC of any
stop order or of any order preventing or suspending the use of any
Prospectus, or the initiation or threat of any proceeding for any
such purpose and (iii) of any request by the SEC for amendments or
supplements to the Registration Statement or Prospectus or for
additional information. In the event of the issuance of any stop
order or of any order preventing or suspending the use of any
Prospectus, the Partnership will promptly use its best efforts to
obtain its withdrawal.
(b) The Partnership will furnish to
CGM, without charge, two signed copies of the Registration
Statement as originally filed and each amendment thereto, including
all exhibits.
(c) The Partnership will not file
any amendment to the Registration Statement or make any amendment
or supplement to the Prospectus of which CGM shall not previously
have been advised or to which CGM shall reasonably object in
writing.
(d) The Partnership will furnish CGM
with copies of any preliminary prospectus and of the Prospectus in
such quantities as they may from time to time reasonably request.
If at any time when the Prospectus is required to be delivered
under the Act any event shall have occurred as a result of which
the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading, or if for any other reason it shall be necessary to
amend or supplement the Prospectus in order to comply with the Act,
the Partnership will notify CGM and upon its request prepare and
furnish without charge to it as many copies as it may from time to
time reasonably request of an amended Prospectus or a supplement to
the Prospectus which will correct such statement or omission or
effect such compliance.
(e) The Partnership will take such
action
