DISTRIBUTION AGREEMENT
Xxxxx Fargo Funds Trust
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
THIS AGREEMENT is made as of this ___ day of September, 1999, by and
between Xxxxx Fargo Funds Trust, a Delaware business trust (the "Trust") and
Xxxxxxxx Inc., an Arkansas corporation (the "Distributor").
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Trust desires to retain the Distributor to render distribution
services to the Trust's investment portfolios listed on Appendix A [to follow]
(individually, a "Fund" and collectively, the "Funds"), and the Distributor is
willing to render such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties agree as follows:
1. As the Trust's agent, the Distributor shall be the exclusive
distributor for the shares of the Fund registered under the Securities Act of
1933 (the "1933 Act"). In addition to providing all share distribution services
for the Funds, the Distributor will maintain a service desk dedicated to the
Funds, and will maintain and preserve all records of the Funds, including
financial and corporate records.
2. The Trust shall sell through the Distributor, as the Trust's agent,
and deliver, upon the terms set forth herein, Fund shares that the Distributor
orders from the Trust and for which the Distributor has received and confirmed
unconditional purchase orders. All orders from the Distributor shall be subject
to acceptance and confirmation by the Trust. The Trust shall have the right, at
its election, to deliver either shares issued upon original issue or treasury
shares.
3. As the Trust's agent, the Distributor may sell and distribute Fund
shares in such manner not inconsistent with the provisions hereof as the
Distributor may determine from time to time. In that connection the Distributor
shall comply with all laws, rules and regulations applicable to it, including,
without limiting the generality of the foregoing, all applicable rules or
regulations under the 1933 Act, the 1940 Act and of any securities association
registered under the Securities Exchange Act of 1934 (the "1934 Act").
4. The Trust reserves the right to sell Fund shares to purchasers to
the extent that it or the transfer agent for Fund shares receives purchase
applications therefor. The Distributor's right to accept purchase orders for
Fund shares or to make sales thereof shall not apply to Fund shares that may be
offered by the Trust to shareholders for the reinvestment of cash distributed to
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shareholders by the Trust or Fund shares that may otherwise be offered by the
Trust to shareholders, unless the Distributor is otherwise notified by the
Trust.
5. All shares offered for sale and sold by the Distributor shall be
offered for sale and sold by the Distributor to or through securities dealers or
banks and other depository institutions having agreements with the Distributor
("Selling Agents") upon the terms and conditions set forth in paragraph 7(b)
hereof or to investors at the price per share (the "offering price", which is
the net asset value per share plus the applicable sales charge, if any)
specified and determined as provided in the Prospectus (the "Prospectus")
included in the Trust's Registration Statement, as amended from time to time,
under the 1933 Act and the 1940 Act (the "Registration Statement"), relating to
the offering of its shares for sale. If the offering price is not an exact
multiple of one cent, it shall be adjusted to the nearest full cent. The Trust
shall determine and furnish promptly to the Distributor a statement of the
offering price at least once on each day on which the Prospectus states the
Trust is required to determine the Trust's net asset value for the purpose of
pricing purchase orders. Each offering price shall become effective at the time
and shall remain in effect during the period specified in the statement. Each
such statement shall show the basis of its computation. For purposes of
establishing the offering price, the Trust shall consider a purchase order to
have been presented to it at the time it was originally entered by the
Distributor for transmission to it, provided the original purchase order and the
Distributor's fulfilling order to the Trust are appropriately time stamped or
evidenced to show the time of original entry and that the Distributor's
fulfilling order to the Trust is received by the Trust within a time deemed by
it to be reasonable after the purchase order was originally entered. Purchases
of shares shall be made for full and fractional shares, carried to the third
decimal place.
6. Ownership of Fund shares sold hereunder shall be registered in such
names and denominations as are specified in writing to the Trust or to its agent
designated for the purpose. No certificates for shares of the Fund will be
issued.
7. (a) The Distributor shall from time to time employ or associate with
it such persons as it believes necessary to assist it in carrying out its
obligations under this agreement. The compensation of such persons shall be
paid by the Distributor.
(b) The Distributor shall have the right to enter into selling
agreements with Selling Agents of its choice for the sale or marketing of Fund
shares at the offering price and upon the terms and conditions set forth in the
Prospectus. The initial form of selling agreement is attached hereto as
Appendix B. The Distributor may amend those agreements, or modify the form of
agreement, only upon approval of the Trust.
(c) The Distributor shall pay all expenses incurred in connection
with its qualification as a dealer or broker under Federal or state laws.
(d) The Distributor shall pay for all expenses incurred in
connection with (i) printing and distributing such number of copies of the
Prospectus as the Distributor deems necessary for use in connection with
offering Fund shares to prospective investors, (ii) preparing, printing and
distributing any other literature and advertising deemed appropriate by the
Distributor for use in connection with offering Fund shares for sale and (iii)
all other expenses
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incurred in connection with the sale of Fund shares as contemplated by this
agreement, except as otherwise specifically provided in this agreement. In
addition, it is understood and agreed that, so long as a plan of distribution of
the Fund adopted pursuant to Rule 12b-1 of the 1940 Act (the "Plan") continues
in effect, any expenses incurred by the Distributor hereunder may be paid from
amounts received by it from the Fund under the Plan. So long as the Plan
continues in effect, the Distributor shall be entitled to receive reimbursement
from the Trust under the Plan for actual expenses incurred in connection with
the Fund to the extent such expenses are reimbursable under the Plan. The
Treasurer of the Trust shall provide to the Board of Trustees of the Trust and
the Board of Trustees shall review, at least quarterly, a written report of the
amounts so expended and the purposes for which such expenditures were made.
(e) The Trust shall pay all expenses incurred in connection with (i)
the preparation, printing and distribution to stockholders of the Prospectus and
reports and other communications to Fund shareholders; (ii) registrations of
Fund shares under the 1933 Act and the Fund under the 1940 Act; (iii) amendments
to the Registration Statement; (iv) qualification of Fund shares for sale in
jurisdictions designated by the Distributor; (v) qualification of the Trust as a
dealer or broker under the laws of jurisdictions designated by the Distributor;
(vi) qualification of the Trust as a foreign corporation authorized to do
business in any jurisdiction if the Distributor determines that such
qualification is necessary or desirable for the purpose of facilitating sales of
Fund shares; (vii) maintaining facilities for the issue and transfer of Fund
shares; (viii) supplying information, prices and other data to be furnished by
the Trust under this agreement; and (ix) original issue taxes or transfer taxes
applicable to the sale or delivery of Fund shares.
(f) The Trust shall execute all documents and furnish any
information which may be reasonably necessary in connection with the
qualification of Fund shares of the Trust for sale in a jurisdiction designated
by the Distributor.
(g) The Trust shall pay to the Distributor the amount that is
payable pursuant to, and in accordance with, the Distribution Plan applicable to
a Fund or class of shares of a Fund, or the maximum amount payable under
applicable laws, regulations and rules, whichever is less. The actual amount
payable with respect to such Fund in any month is to be determined by mutual
agreement.
8. The Trust shall furnish the Distributor from time to time, for use
in connection with the sale of Fund shares, such written information with
respect to the Trust as the Distributor may reasonably request. In each case
such written information shall be signed by an authorized officer of the Trust.
The Trust represents and warrants that such information, when signed by one of
its officers, shall be true and correct. The Trust shall also furnish to the
Distributor copies of its reports to its stockholders and such additional
information regarding the Trust's financial condition as the Distributor may
reasonably request from time to time.
9. The Registration Statement and the Prospectus have been or will be,
as the case may be, prepared in conformity with the 1933 Act, the 1940 Act and
the rules and regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "SEC"). The Trust represents and warrants to the
Distributor that the Registration Statement and the Prospectus contain or will
contain all statements required to be stated therein in accordance with
3
the 1933 Act, the 1940 Act and the Rules and Regulations, that all statements of
fact contained or to be contained therein are or will be true and correct at the
time indicated or the effective date, as the case may be, and that neither the
Registration Statement nor the Prospectus, when it shall become effective under
the 1933 Act or be authorized for use, shall include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading to a purchaser of Fund
shares. The Trust shall from time to time file such amendment or amendments to
the Registration Statement and the Prospectus as, in the light of future
developments, shall, in the opinion of the Trust's counsel, be necessary in
order to have the Registration Statement and the Prospectus at all times contain
all material facts required to be stated therein or necessary to make the
statements therein not misleading to a purchaser of Fund shares. If the Trust
shall not file such amendment or amendments within 15 days after receipt by the
Trust of a written request from the Distributor to do so, the Distributor may,
at its option, terminate this agreement immediately. The Trust shall not file
any amendment to the Registration Statement or the Prospectus without giving the
Distributor reasonable notice thereof in advance, provided that nothing in this
agreement shall in any way limit the Trust's right to file at any time such
amendments to the Registration Statement or the Prospectus as the Trust may deem
advisable. The Trust represents and warrants to the Distributor that any
amendment to the Registration Statement or the Prospectus filed hereafter by the
Trust will, when it becomes effective under the 1933 Act, contain all statements
required to be stated therein in accordance with the 1933 Act, the 1940 Act and
the Rules and Regulations, that all statements of fact contained therein will,
when the same shall become effective, be true and correct, and that no such
amendment, when it becomes effective, will include an untrue statement of a
material fact or will omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading to a
purchaser of Fund shares.
10. Subject to the provisions of paragraph 7, the Trust shall prepare
and furnish to the Distributor from time to time such number of copies of the
most recent form of the Prospectus filed with the SEC as the Distributor may
reasonably request. The Trust authorizes the Distributor and Selling Agents to
use the Prospectus, in the form furnished to the Distributor from time to time,
in connection with the sale of Fund shares. The Trust shall indemnify, defend
and hold harmless the Distributor, its officers and partners and any person who
controls the Distributor within the meaning of the 1933 Act, from and against
any and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which the Distributor, its officers or
partners or any such controlling person, may incur under the 1933 Act, the 1940
Act, other statutes, the common law or otherwise, arising out of or based upon
any alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus or arising out of or based upon any alleged omission
to state a material fact required to be stated in either thereof or necessary to
make the statements in either thereof not misleading. Notwithstanding the
foregoing, this indemnity agreement, to the extent that it might require
indemnity of any person who is an officer or partner of the Distributor and who
is also a director of the Trust, shall not inure to the benefit of such officer
or partner unless a court of competent jurisdiction shall determine, or it shall
have been determined by controlling precedent, that such result would not be
against public policy as expressed in the 1933 Act or the 1940 Act, and in no
event shall anything contained herein be so construed as to protect the
Distributor against any liability to the Trust or its stockholders to which the
Distributor would otherwise be subject by reason of willful misfeasance, bad
faith or negligence in the performance of its duties or by reason of its
reckless
4
disregard of its obligations and duties under this agreement. This indemnity
agreement is expressly conditioned upon the Trust's being notified of any action
brought against the Distributor, its officers or partners or any such
controlling person, which notification shall be given by letter or by telegram
addressed to the Trust at its principal office in Little Rock, Arkansas, and
sent to the Trust by the person against whom such action is brought within ten
days after the summons or other first legal process shall have been served. The
failure to notify the Trust of any such action shall not relieve the Trust from
any liability which it may have to the person against whom such action is
brought by reason of any such alleged untrue statement or omission otherwise
than on account of the indemnity agreement contained in this paragraph. The
Trust shall be entitled to assume the defense of any suit brought to enforce any
such claim, demand or liability, but, in such case, the defense shall be
conducted by counsel chosen by the Trust and approved by the Distributor. If the
Trust elects to assume the defense of any such suit and retain counsel approved
by the Distributor, the defendant or defendants in such suit shall bear the fees
and expenses of any additional counsel retained by any of them, but in case the
Trust does not elect to assume the defense of any such suit, or in case the
Distributor does not approve of counsel chosen by the Trust, the Trust will
reimburse the Distributor, its officers and partners or the controlling person
or persons named as defendant or defendants in such suit, for the fees and
expenses of any counsel retained by the Distributor or them. In addition, The
Distributor shall have the right to employ one separate counsel to represent it,
its officers and partners and any such controlling person who may be subject to
liability arising out of any claim in respect of which indemnity may be sought
by the Distributor against the Trust hereunder if in the reasonable judgment of
the Distributor it is advisable because of existing or potential differing
interests between the Distributor, its officers and partners or such controlling
person and the Trust in the conduct of the defense of such action, for the
Distributor, its officers and partners or such controlling person to be
represented by separate counsel, in which event the fees and expenses of such
separate counsel shall be borne by the Trust. This indemnity agreement and the
Trust's representations and warranties in this agreement shall remain operative
and in full force and effect regardless of any investigation made by or on
behalf of the Distributor, its officers and partners or any such controlling
person and shall survive the delivery of any shares as provided in this
agreement. This indemnity agreement shall inure exclusively to the benefit of
the Distributor and its successors, the Distributor's officers and partners and
their respective estates and any such controlling persons and their successors
and estates. The Trust shall promptly notify the Distributor of the commencement
of any litigation or proceedings against it in connection with the issue and
sale of any Fund shares.
11. The Distributor agrees to indemnify, defend and hold harmless the
Trust, its officers and directors and any person who controls the Trust within
the meaning of the 1933 Act, from and against any and all claims, demands,
liabilities and expenses (including the cost of investigating or defending such
claims, demands or liabilities and any counsel fees incurred in connection
therewith) which the Trust, its officers or directors or any such controlling
person, may incur under the 1933 Act, the 1940 Act, other statutes, the common
law or otherwise, but only to the extent that such liability or expense incurred
by the Trust, its officers or directors or such controlling person resulting
from such claims or demands shall arise out of or be based upon (a) any alleged
untrue statement of a material fact contained in information furnished in
writing by the Distributor to the Trust specifically for use in the Registration
Statement or the Prospectus or shall arise out of or be based upon any alleged
omission required to be stated in the Registration Statement or the Prospectus
or necessary to make such information not misleading,
5
(b) any alleged act or omission on the Distributor's part as the Trust's agent
that has not been expressly authorized by the Trust in writing, or (c) any
alleged willful misfeasance, bad faith or negligence in the performance of the
Distributor's obligations and duties under the Agreement or by reason of its
alleged reckless disregard thereof. This indemnity agreement is expressly
conditioned upon the Distributor's being notified of any action brought against
the Trust, its officers and directors or any such controlling person, which
notification shall be given by letter or telegram, addressed to the Distributor
at its principal office in Little Rock, Arkansas, and sent to the Distributor by
the person against whom such action is brought, within 10 days after the summons
or other first legal process shall have been served. The failure to notify the
Distributor of any such action shall not relieve the Distributor from any
liability which it may have to the Trust, its officers or directors or such
controlling person by reason of any such alleged misstatement or omission on the
Distributor's part otherwise than on account of the indemnity agreement
contained in this paragraph. The Distributor shall have a right to control the
defense of such action with counsel of its own choosing and approved by the
Trust if such action is based solely upon such alleged misstatement or omission
on the Distributor's part, and in any other event the Trust, its officers and
directors or such controlling person shall each have the right to participate in
the defense or preparation of the defense of any such action at their own
expense.
12. No Fund shares shall be sold through the Distributor or by the Trust
under this agreement and no orders for the purchase of Fund shares shall be
confirmed or accepted by the Trust if and so long as the effectiveness of the
Registration Statement shall be suspended under any of the provisions of the
1933 Act. Nothing contained in this paragraph 12 shall in any way restrict,
limit or have any application to or bearing upon the Trust's obligation to
redeem Fund shares from any shareholder in accordance with the provisions of its
Declaration of Trust. The Trust will use its best efforts at all times to have
Fund shares effectively registered under the 1933 Act.
13. The Trust agrees to advise the Distributor immediately:
(a) of any request by the SEC for amendments to the Registration
Statement or the Prospectus or for additional information;
(b) in the event of the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement or the Prospectus
under the 1933 Act or the initiation of any proceedings for that purpose;
(c) of the happening of any material event that makes untrue any
statement made in the Registration Statement or the Prospectus or that requires
the making of a change in either thereof in order to make the statements therein
not misleading; and
(d) of any action of the SEC with respect to any amendments to the
Registration Statement or the Prospectus that may from time to time be filed
within the SEC under the 1933 Act or the 1940 Act.
14. Insofar as they concern the Trust, the Trust shall comply with all
applicable laws, rules and regulations, including, without limiting the
generality of the foregoing, all rules or
6
regulations made or adopted pursuant to the 1933 Act, the 1940 Act or by any
securities association registered under the 1934 Act.
15. The Distributor may, if it desires and at its own cost and expense,
appoint or employ agents to assist it in carrying out its obligations under this
agreement, but no such appointment or employment shall relieve the Distributor
of any of its responsibilities or obligations to the Trust under this agreement.
16. The following provisions shall apply with respect to the sale by
Distributor of Class B Shares of any Fund, notwithstanding any other provision
herein to the contrary:
(a) Distributor shall have the obligation to pay all applicable
dealer allowances ("B Share Allowances") to which Selling Agents are entitled to
receive in connection with the sale of Class B Shares, including any such B
Share Allowances, or portions thereof, to which registered representatives of
Distributor are entitled to receive.
(b) To the extent that Distributor engages and uses a third-party to
finance its obligation to pay B Share Allowances as set forth in this section,
Distributor shall have the right to assign to such third-party all or any
portion of Distributor's right hereunder to receive fees in connection with the
sale of Class B Shares and to direct the Company, upon written notice, to make
direct payment of these fees to such party, free and clear of any rights to
offset or claims of the Trust or any Fund against Distributor.
(c) The Trust acknowledges that, under the applicable Distribution
Plan for Class B Shares of the Funds, any payments that the Funds make to
Distributor with respect to Class B Shares shall continue, in accordance with,
and subject to, the applicable terms relating to the Class B Shares, regardless
of whether Distributor is acting as the principal underwriter for the Trust (and
affected Funds); provided that the Distribution Plan for the Class B Shares has
not been terminated or modified in a way which affects the payment of such
amounts.
17. Subject to the provisions of paragraph 9, this agreement shall
continue in effect until such time as there shall remain no shares registered
under the 1933 Act, provided that this agreement shall continue in effect for a
period of more than one year from the date hereof only so long as such
continuance is specifically approved at least annually in accordance with the
1940 Act and the rules thereunder. This agreement shall terminate automatically
in the event of its assignment (as defined in the 1940 Act). This agreement
may, in any event, be terminated at any time, without the payment of any
penalty, by the Trust upon 60 days' written notice to the Distributor or by the
Distributor at any time after the second anniversary of the effective date of
this agreement on 60 days' written notice to the Trust.
18. Nothing in this Agreement shall require the Trust to take any action
contrary to any provision of its Declaration of Trust or to any applicable
statute or regulation.
19. Miscellaneous.
(a) Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Trust or the Distributor shall be
sufficiently given if addressed to
7
that party and received by it at its office set forth below or at such other
place as it may from time to time designate in writing.
To the Trust:
Xxxxx Fargo Funds Trust
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Secretary
With a copy to:
Xxxxx Fargo Bank, N.A.
000 Xxxxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: C. Xxxxx Xxxxxxx, Vice President and Senior Counsel
To the Distributor:
Xxxxxxxx Inc.
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Senior Vice President
(b) This Agreement shall extend to and be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be subject to assignment (as that term is defined
under the 1940 Act).
(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
(d) This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, and which collectively shall be
deemed to constitute only one agreement.
(e) If any provision of this Agreement is declared to be
prohibited or unenforceable, the remaining provisions of this Agreement shall
continue to be valid and fully enforceable.
In witness whereof, the parties have caused this Agreement to be executed
by their duly authorized officers as of the day and year first above written.
8
XXXXX FARGO FUNDS TRUST
By: ______________________________
Xxxxxxx X. Xxxxx
Chief Operating Officer
XXXXXXXX INC.
By: ______________________________
R. Xxxx Xxxxxx
Executive Vice President
9
Appendix A
Funds of Xxxxx Fargo Funds Trust Covered by This Agreement
1. Aggressive Balanced-Equity Fund
2. Arizona Tax-Free Fund
3. Asset Allocation Fund
4. California Tax-Free Bond Fund
5. California Tax-Free Income Fund
6. California Tax-Free Money Market Fund
7. California Tax-Free Money Market Trust
8. Cash Investment Money Market Fund
9. Colorado Tax-Free Fund
10. Corporate Bond Fund
11. Disciplined Growth Fund
12. Diversified Bond Fund
13. Diversified Equity Fund
14. Diversified Small Cap Fund
15. Equity Index Fund
16. Equity Value Fund
17. Government Money Market Fund
18. Growth Balanced Fund
19. Growth Equity Fund
20. Growth Fund
21. Income Equity Fund
22. Income Fund
23. Income Plus Fund
24. Index Allocation Fund
25. Index Fund
26. Intermediate Government Income Fund
27. International Equity Fund
28. International Fund
29. Large Company Growth Fund
30. LifePath Opportunity Fund
31. LifePath 2010 Fund
32. LifePath 2020 Fund
33. LifePath 2030 Fund
34. LifePath 2040 Fund
35. Limited Term Tax-Free Fund
36. Limited Term Government Income Fund
37. Minnesota Intermediate Tax-Free Fund
38. Minnesota Tax-Free Fund
39. Moderate Balanced Fund
40. Money Market Fund
41. Money Market Trust
42. National Tax-Free Institutional Money Market Fund
43. National Tax-Free Money Market Fund
44. National Tax-Free Money Market Trust
45. Oregon Tax-Free Fund
46. Overland Express Sweep Fund
47. Prime Investment Money Market Fund
48. Small Cap Fund
49. Small Cap Opportunities Fund
50. Small Cap Value Fund
51. Small Company Growth Fund
52. Stable Income Fund
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53. Strategic Income Fund
54. Tax-Free Income Fund
55. Treasury Plus Institutional Money Market Fund
56. Treasury Plus Money Market Fund
57. 100% Treasury Money Market Fund
58. Variable Rate Government Fund
59. Wealthbuilder II Growth & Income Portfolio
60. Wealthbuilder II Growth Balanced Portfolio
61. Wealthbuilder II Growth Portfolio
Approved by Board of Trustees: March 26, 1999
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Appendix B
Form of Selling Group Agreement
XXXXXXXX INC.
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
XXXXX FARGO FUNDS TRUST
________________________________
________________________________
________________________________
Ladies and Gentlemen:
We are the exclusive distributor of the shares of capital stock of the
several portfolios (each a "Fund" and collectively the "Funds") of Xxxxx Fargo
Funds Trust (the "Trust"), a Delaware business trust, pursuant to the terms of a
Distribution Agreement between us and the Trust. We invite you to participate
in the distribution of the shares of capital stock of certain of the Funds (as
identified to you from time to time) ("Shares") on the following terms:
1. You represent and warrant that you are either (a) a registered broker
or dealer pursuant to the Securities Exchange Act of 1934 ("1934 Act"),
and a member of the National Association of Securities Dealers, Inc. (the
"NASD"), and that you will maintain such registration and membership and
abide by the Rules of Fair Practice, the Constitution and By-Laws of the
NASD and all other rules and regulations that are now or may become
applicable to you and your activities hereunder; or (b) a bank exempt
from registration as a broker-dealer under the federal securities laws,
and that you will conduct your activities hereunder and otherwise in a
manner so as to remain exempt from such registration and in compliance
with the provisions of the Xxxxx-Xxxxxxxx Act and all other rules and
regulations that are now or may become applicable to you and your
activities hereunder.
2. You represent and warrant that you are registered or qualified to act
as a broker or dealer (or are exempt from being required to register or
qualify as such) in the states or other jurisdictions where you transact
business. You agree that you will maintain such registrations or
qualifications in full force and effect throughout the term of this
Agreement (and if an exemption becomes no longer available, to
immediately so qualify or register). You agree to comply with all
applicable federal, state and local laws, including, without limiting the
generality of the foregoing, the Securities Act of 1933, the 1934 Act and
the Investment Company Act of 1940, and all applicable rules or
regulations thereunder. You agree to offer and sell Shares only in the
states and other jurisdictions in which we have indicated that such
offers and sales can be made and in which you are qualified to so act.
You further agree not to
12
offer or sell Shares outside the several states, territories and
possessions of the United States.
3. You agree to offer and sell Shares of the Funds to your customers only
at the applicable public offering price (which is the net asset value per
share plus the applicable sales load, if any) then in effect as described
in the respective Fund's then currently effective prospectus, including
any supplements or amendments thereto ("Prospectus"). You may establish
and charge reasonable service fees to your clients for processing
exchange or redemption orders for Shares, provided you disclose the fees
to your clients.
4. Purchase orders for Shares ("Purchase Orders") received from you and
accepted by us will be executed at the applicable public offering price
next determined after our receipt and acceptance of such Purchase Order,
in accordance with the Prospectuses. All Purchase Orders must meet the
applicable minimum initial and subsequent investment requirements as
described and set forth in the Prospectuses. You agree to date and time
stamp all orders received by you and to promptly forward all Purchase
Orders to us or the Trust's Transfer Agent in time for processing at the
public offering price next determined after receipt by you. You agree
that you will not withhold Purchase Orders or purchase shares in
anticipation of receiving Purchase Orders from customers. The procedures
applicable to the handling of Purchase Orders shall be subject to such
instructions as may be issued by us from time to time.
5. All Purchase Orders are subject to acceptance by us and confirmation
by the Trust or its Transfer Agent. We reserve the right in our sole
discretion to reject any Purchase Order, including contingent or
conditional Purchase Orders, in whole or in part. We also reserve the
right in our discretion without notice to you to suspend sales or
withdraw the offering of Shares, in whole or in part, or to cancel this
Agreement.
6. You agree to purchase Shares only through us or from your customers.
Purchases through us shall be made only for the purpose of covering
Purchase Orders already received from your customers or for your bona
fide investment. Purchases from your customers, if any, shall be at a
price that is not less than the applicable net asset value quoted by the
Trust at the time of such purchase as determined in the manner set forth
in the Prospectuses. All transactions in Shares shall be subject to the
terms and provisions set forth in the Prospectuses.
7. Shares purchased hereunder will not be issued in certificated form
except where permitted by the applicable Prospectus, upon written request
by you or your customer, and only when payment and proper registration or
transfer instructions have been received by the Trust or its Transfer
Agent.
8. If a customer's account with a Fund is established without the
customer signing an Account Application, you represent that the
instructions relating to the registration and shareholder options
selected (whether on the Account Application, in some other
13
document or orally) are in accordance with the customer's instructions,
and you shall be responsible to the Trust, its Transfer Agent and us for
any losses, claims, damages or expenses resulting from acting upon such
instructions.
9. If payment for Shares purchased hereunder is not received or made
within the applicable time period specified in the governing Prospectus,
or if you cancel any order at any time after our acceptance of the
Purchase Order, we reserve the right to cancel the sale (or, at our
option, to redeem the Shares), in which case you shall be responsible to
the Trust, its Transfer Agent and us for any losses, claims, damages or
expenses resulting from your failure to make payment or cancellation as
aforesaid.
10. You have no authority whatsoever to act as agent for, partner of or
participant in a joint venture with the Trust or us or any other member
of the Selling Group, and nothing in this Agreement shall constitute
either of us the agent of the other or shall constitute you or the Trust
the agent of each other. In all transactions in the Shares, you are
acting as principal or as agent for your customer and we are acting as
agent for the Trust and not as principal. We are not responsible for
registering or qualifying the Shares for sale in any jurisdiction. We
also are not responsible for the issuance, form, validity, enforceability
or value of the Trust's Shares.
11. No person is authorized to act for us or to make any representations
concerning the Trust or its Shares except those contained in the
Prospectuses and the Statements of Additional Information, and in sales
literature issued by us supplemental to the Prospectuses and Statements
of Additional Information ("Sales Literature"). In purchasing Shares
through us, you shall rely solely upon the representations contained in
the Prospectuses, the Statements of Additional Information and the Sales
Literature. We will furnish you, upon request, with a reasonable quantity
of copies of the Prospectuses, Statements of Additional Information,
Sales Literature and amendments and supplements thereto. You agree that
if and when we supply you with copies of any supplements to any
Prospectus, you will affix copies of such supplements to all such
Prospectuses in your possession, that thereafter you will distribute such
Prospectuses only with such supplements affixed, and that you will
present Purchase Orders only from persons who have received Prospectuses
with such supplements affixed. You agree not to use Sales Literature in
connection with the solicitation of Purchase Orders unless accompanied or
preceded by the relevant Prospectus.
12. As compensation, you shall be entitled to receive that portion of the
sales load assessed on the purchase of the Shares equal to the dealer
allowance, as set forth in the Prospectuses. Sales loads and dealer
allowances shall take into account volume discounts, rights of
accumulation, letters of intent, certain reinvestments of redemption
proceeds, certain reductions for designated persons or groups and
exchanges and any other arrangements for the reduction or elimination of
sales loads and dealer allowances, all as described in the Prospectuses.
You are responsible for obtaining from your customer such information as
you deem necessary to establish a reasonable basis for believing that the
customer is eligible for any claimed reductions in or elimination of
sales loads, and for obtaining from your customer requisite tax
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identification numbers and certifications. By transmitting Purchase
Orders to us or to the Trust's Transfer Agent, you shall be deemed to
have represented and warranted to us, the Trust, and its Transfer Agent
that you have a reasonable basis for believing, and do believe, that the
customer is eligible for such reduction or elimination and that, unless
you advise us otherwise, you have obtained the requisite tax
identification numbers and certifications.
13. As further compensation for distribution-related services performed
by you in connection with the distribution of Shares of certain of the
Funds which have distribution plans in effect under Rule 12b-1 under the
1940 Act that provide for compensation for distribution-related services,
you also may receive a periodic fee based upon a percentage of the
average daily net asset value of Shares of the respective Funds
attributable to you, in accordance with the applicable Distribution Plans
as disclosed in the governing Prospectus.
14. If any Shares are repurchased or tendered for redemption by the Trust
within seven business days after acceptance by us or the Trust of the
Purchase Order for such Shares, you shall forfeit the right to and
promptly refund to us the full dealer allowance paid or reallowed to you
in connection with the original Purchase Order.
15. You agree to indemnify the Trust, its Transfer Agent and us for any
losses, claims, damages or expenses arising out of or in connection with
any wrongful act or omission by you, your representatives, agents or sub-
agents not in accordance with this Agreement, provided that such losses,
claims, damages or expenses were not caused by the indemnitees' willful
misfeasance, bad faith or gross negligence.
16. This Agreement shall become effective upon receipt by us of a signed
copy hereof, and shall cancel and supersede any and all prior Selling
Group Agreements or similar agreements or contracts relating to the
distribution of the Shares. Any amendments to this Agreement shall be
deemed accepted by you, and will take effect with respect to, and on the
date of, any orders placed by you after the date set forth in any notice
of amendment sent by us to you. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Arkansas.
17. This Agreement may be terminated upon written notice by either party
at any time, and shall automatically terminate upon its attempted
assignment by you, whether by operation of law or otherwise, or by us
otherwise than by operation of law. We reserve the right to cancel this
Agreement at any time without notice if any Shares are offered for sale
by you at less than the applicable public offering price as set forth in
the Prospectuses.
18. This Agreement is in all respects subject to statements regarding the
sale and repurchase or redemption of Shares made in the Prospectuses, and
to the Rules of Fair Practice of the NASD, which shall control and
override any provision to the contrary in this Agreement.
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19. All communications to us shall be sent to us by mail or by confirmed
telefacsimile at 000 Xxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000. Any
notice to you shall be duly given if sent by mail or by confirmed
telefacsimile to you at your address as set forth on the signature page
hereof. Any party that changes its address shall promptly notify the
other party in accordance with the terms of this paragraph.
Date: ____________
XXXXXXXX INC.
By: ________________________
Name: ______________________
Title: _____________________
The undersigned accepts this invitation to become a member of the Selling
Group and agrees to abide by the foregoing terms and conditions.
Date: _______________
Address:
Telephone:
Telefacsimile:
By: _______________________ By: ______________________
(Authorized Signature) (Authorized Signature)
Name: ___________________ Name: ________________
Title: _________________ Title: _______________
Please execute this Agreement in duplicate and return one copy to
Xxxxxxxx Inc.
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