during this period the lead underwriter began to form the underwriting syndicate which comprised a number of investment banks that agreed to buy portions of the offering at the offer price less the underwriting discount in addition to the syndicate members dealers were enlisted to sell a certain number of shares on a best efforts basis the dealers received a fixed reallowance or concession for each share sold the selling agreement provided the contract among members of the syndicate the agreement granted power of attorey to the lead underwriter and stipulated the management fee that each syndicate member was required to pay the lead underwriter the share allocations and dealer reallowances or concessions because the exact terms of the agreement were not specified a range of expected compensation levels the selling agreement was structured so that the contract became binding when it was orally approved via telephone by the syndicate members after the effective date