EXHIBIT (E)(3)
Quasar Distributors, LLC
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
DEALER AGREEMENT
This Agreement is made as of __________, 20__, by and among Quasar
Distributors, LLC ("Quasar"), a Delaware limited liability company,
_____________ ("Dealer"), a ______________ corporation, and Xxxxxxxx Investment
Management, LLC, a Delaware limited liability company (solely with respect to
Section 5 hereto).
WHEREAS, Xxxxxxxx Plumb Funds, Inc. is registered under the Investment
Company Act of 1940, as amended ("1940 Act"), as an open-end management
investment company and currently offers for public sale shares of common stock
("Shares") in the separate series of the Fund Company listed on Schedule A, as
may be amended from time to time (each, a "Fund");
WHEREAS, Quasar serves as principal underwriter in connection with the
offering and sale of the Shares of each Fund pursuant to a Distribution
Agreement, and
WHEREAS, Dealer desires to serve as a selected dealer for the Shares of
the Funds.
NOW, THEREFORE, in consideration of the promises and the mutual covenants
contained herein, Quasar and Dealer agree as follows:
1. Selected Dealer.
(a) Dealer agrees to offer and sell Shares only at the public offering
price currently in effect, in accordance with the terms of the then-current
prospectus(es), including any supplements or amendments thereto, of each Fund
("Prospectus"). The Dealer agrees to act only as agent on behalf of its
customers ("Customers") in such transactions and shall not have authority to act
as agent for the Funds, for Quasar, or for any other dealer in any respect. All
purchase orders are subject to acceptance by Quasar and the relevant Fund and
become effective only upon confirmation by Quasar or an agent of the Fund. In
its sole discretion, either the Fund or Quasar may reject any purchase order and
may, provided notice is given to Dealer, suspend sales or withdraw the offering
of Shares entirely.
(b) Dealer agrees that, if requested by Quasar, it will undertake from
time to time certain shareholder servicing activities ("shareholder services")
as requested by Quasar, for Customers who have purchased Shares. Dealer may
perform these duties itself or subcontract them to a third party of its choice.
These shareholder services may include, but are not limited to, one or more of
the following services as determined by Quasar: (i) maintaining accounts
relating to Customers that invest in Shares; (ii) providing information
periodically to Customers showing their positions in Shares; (iii) arranging for
bank wires; (iv) responding to Customer inquiries relating to the services
performed by Dealer; (v) responding to routine inquiries from Customers
concerning their investments in Shares; (vi) forwarding shareholder
communications from the Funds (such as proxies, shareholder reports, annual and
semi-annual financial statements and dividend, distribution and tax notices) to
Customers; (vii) processing purchase, exchange and redemption requests from
Customers and placing such orders with the Funds' service providers; (viii)
assisting Customers in changing dividend options, account designations, and
addresses; (ix) providing subaccounting with respect to Shares beneficially
owned by Customers; (x) processing dividend payments from the Funds on behalf of
Customers; and (xi) providing such other similar services as Quasar may
reasonably request to the extent Dealer is permitted to do so under applicable
laws or regulations.
2. Procedures for Purchases. The procedures relating to all orders and the
handling of them shall be made in accordance with the procedures set forth in
each Fund's Prospectus, and to the extent consistent with the Prospectus,
written instructions forwarded to Dealer by Quasar from time to time.
Dealer shall be permitted to accept orders for the purchase, exchange or
redemption of Shares of the Funds on each business day that the New York Stock
Exchange is open for business and a Fund's net asset value is determined
("Business Day"). Dealer shall not be required to accept orders on any Business
Day on which Dealer is not open for business. If orders are accepted by Dealer
prior to the latest time at which a Fund's net asset value is to be calculated
as determined by its Board of Directors/Trustees, which is typically as of the
close of the New York Stock Exchange on that Business Day ("Close of Trading"),
such orders shall be treated as having been received on that Business Day. If
such orders are received after Close of Trading on a Business Day, they shall
not be treated as having been accepted by Dealer on such Business Day.
All purchase orders shall be placed at, and in accordance with the
applicable discount schedules set forth in the Fund's then current
prospectus ( "Breakpoints").
3. Settlement and Delivery for Purchases. Transactions shall be settled by
Dealer by payment in federal funds of the full purchase price to the Fund's
transfer agent in accordance with applicable procedures. Payment for Shares
shall be received by the Fund's transfer agent by the later of (a) the end of
the third business day following Dealer's receipt of the Customer's order to
purchase such Shares or (b) the end of one business day following Dealer's
receipt of the Customer's payment for such Shares, but in no event later than
the end of the sixth business day following Dealer's receipt of the Customer's
order. If such payment is not received within the time specified, the sale may
be canceled forthwith without any responsibility or liability on Quasar's part
or on the part of the Funds to Dealer or its Customers. In addition, Dealer will
be responsible to the Fund and/or Quasar for any losses suffered on the
transaction.
4. Procedures for Redemption, Repurchase and Exchange. Redemption or
repurchases of Shares as well as exchange requests shall be made in accordance
with the procedures set forth in each Fund's Prospectus, and to the extent
consistent with the Prospectus, written instructions forwarded to Dealer by
Quasar from time to time.
5. Compensation. For the services provided under the terms of this
Agreement, Dealer shall be eligible to receive a fee of 0.___% of the average
daily net assets of the Fund (computed on an annual basis) which are owned of
record by Dealer as nominee for its Customers or which are owned by those
Customers of Dealer whose records, as maintained by the Fund or its agent,
designate Dealer as the Customer's dealer or service provider of record.
If any Shares sold by Dealer under the terms of this Agreement are
redeemed by a Fund or tendered for redemption or repurchased by a Fund or by
Quasar as agent within seven business days after the date Dealer purchased such
Shares, Dealer shall notify Quasar in writing and shall forfeit its right to any
discount or commission received by or allowed to Dealer from the original sale.
6. Expenses. Dealer agrees that it will bear all expenses incurred in
connection with its performance of this Agreement.
7. Dealer Registration.
(a) Dealer represents and warrants that (i) it is registered as a
broker-dealer under the Securities Exchange Act of 1934 (the "1934 Act") or is
exempt from registration as a broker-dealer under the 1934 Act, (ii) it is
qualified as a broker-dealer in all states or other jurisdictions in which it
sells Fund Shares or is exempt from registration as a broker-dealer in all
states or other jurisdictions in which it sells Fund Shares, and, (iii) if it
sells Shares in additional states or jurisdictions in the future, will become
qualified to act as a dealer in each such state or jurisdiction prior to selling
any Fund Shares or will confirm an exemption from registration as a
broker-dealer in each such state or jurisdiction prior to selling any Fund
Shares.
(b) Dealer shall maintain any filings and licenses required by federal and
state laws to conduct the business contemplated under this Agreement. Dealer
agrees to notify Quasar immediately in the event of any finding that it violated
any applicable federal or state law, rule or regulation arising out of its
activities as a broker-dealer or in connection with this Agreement, or which may
otherwise affect in any material way its ability to act in accordance with the
terms of this Agreement.
(c) If Dealer is a "bank," as such term is defined in Section 3(a)(6) of
the 1934 Act, Dealer further represents and warrants that it is a member of the
Federal Deposit Insurance Corporation ("FDIC") in good standing and agrees to
notify Quasar immediately of any changes in Dealer's status with the FDIC.
(d) If Dealer is registered as a broker-dealer under the 1934 Act, Dealer
represents and warrants that it is a member in good standing of the National
Association of Securities Dealers, Inc. (the "NASD") and that it agrees to abide
by the Conduct Rules of the NASD. Dealer agrees to notify Quasar immediately in
the event of its expulsion or suspension from the NASD.
(e) If Dealer is registered as a broker-dealer under the 1934 Act, Dealer
further represents and warrants that it is a member of the Securities Investor
Protection Corporation ("SIPC") in good standing and agrees to notify Quasar
immediately of any changes in Dealer's status with SIPC.
8. Compliance With Federal and State Laws.
(a) Dealer will not sell any of the Shares except in compliance with all
applicable federal and state securities laws. In connection with sales and
offers to sell Shares, Dealer will furnish or cause to be furnished to each
person to whom any such sale or offer is made, at or prior to the time of
offering or sale, a copy of the Prospectus and, if requested, the related SAI.
Quasar shall be under no liability to Dealer except for lack of good faith and
for obligations expressly assumed by Quasar herein. Nothing herein contained,
however, shall be deemed to be a condition, stipulation or provision binding any
persons acquiring any security to waive compliance with, or to relieve the
parties hereto from any liability arising under, the federal securities laws.
(b) Quasar shall, from time to time, inform Dealer as to the states and
jurisdictions in which Quasar believes the Shares have been qualified for sale
under, or are exempt from the requirements of, the respective securities laws of
such states and jurisdictions. Dealer agrees that it will not knowingly offer or
sell Shares in any state or jurisdiction in which such Shares are not qualified,
unless any such offer or sale is made in a transaction that qualifies for an
exemption from registration.
(c) Quasar assumes no responsibility in connection with the registration
of Dealer under the laws of the various states or under federal law or Dealer's
qualification under any such law to offer or sell Shares.
9. Unauthorized Representations. No person is authorized to make any
representations concerning Shares of the Funds except those contained in the
Prospectus, SAI and printed information issued by each Fund or by Quasar as
information supplemental to each Prospectus. Quasar shall, upon request, supply
Dealer with reasonable quantities of Prospectuses and SAIs. Dealer agrees not to
use other advertising or sales material relating to the Funds unless approved by
Quasar in advance of such use. Neither party shall use the name of the other
party in any manner without the other party's written consent, except as
required by any applicable federal or state law, rule or regulation, and except
pursuant to any mutually agreed upon promotional programs.
10. Confirmations. Dealer agrees to send confirmations of orders to its
Customers as required by Rule 10b-10 of the 1934 Act. In the event the Customers
place orders directly with the Fund or any of its agents, confirmations will be
sent to such Customers, as required, by the Fund's transfer agent.
11. Records. Dealer agrees to maintain all records required by applicable
state and federal laws and regulations relating to the offer and sale of Shares
to its Customers, and upon the reasonable request of Quasar, or of the Funds, to
make these records available to Quasar or the Fund's administrator as reasonably
requested. On orders placed directly with the Fund or its agents, the Fund's
transfer agent will maintain all records required by state and federal laws and
regulations relating to the offer and sale of Shares.
12. Taxpayer Identification Numbers. Dealer agrees to obtain any taxpayer
identification number certification from its Customers required under the
Internal Revenue Code and any applicable Treasury regulations, and to provide
Quasar or its designee with timely written notice of any failure to obtain such
taxpayer identification number certification in order to enable the
implementation of any required backup withholding.
13. Indemnification.
(a) Dealer shall indemnify and hold harmless Quasar, each Fund, the
transfer agent and administrator of the Funds, and their respective affiliates,
officers, directors, agents, employees and controlling persons from all direct
or indirect liabilities, losses or costs (including reasonable attorneys' fees)
arising from, related to or otherwise connected with any breach by Dealer of any
provision of this Agreement.
(b) Quasar shall indemnify and hold harmless Dealer and its affiliates,
officers, directors, agents, employees and controlling persons from and against
any and all direct or indirect liabilities, losses or costs (including
reasonable attorneys' fees) arising from, related to or otherwise connected with
any breach by Quasar of any provision of this Agreement.
(c) The Agreement of the parties in this Paragraph to indemnify each other
is conditioned upon the party entitled to indemnification (the "Indemnified
Party") notifying the other party (the "Indemnifying Party") promptly after the
summons or other first legal process for any claim as to which indemnity may be
sought is served on the Indemnified Party, unless failure to give such notice
does not prejudice the Indemnifying Party. The Indemnified Party shall permit
the Indemnifying Party to assume the defense of any such claim or any litigation
resulting from it, provided that counsel for the Indemnifying Party who shall
conduct the defense of such claim or litigation shall be approved by the
Indemnified Party (which approval shall not unreasonably be withheld), and that
the Indemnified Party may participate in such defense at its expense. The
failure of the Indemnified Party to give notice as provided in this subparagraph
(c) shall not relieve the Indemnifying Party from any liability other than its
indemnity obligation under this Paragraph. No Indemnifying Party, in the defense
of any such claim or litigation, shall, without the written consent of the
Indemnified Party, consent to entry of any judgment or enter into any settlement
that does not include as an unconditional term the giving by the claimant or
plaintiff to the Indemnified Party of a release from all liability in respect to
such claim or litigation.
14. No Agency Created. Nothing in this Agreement shall be deemed or
construed to make Dealer an employee, agent, representative or partner of any of
the Funds or of Quasar, and Dealer is not authorized to act for Quasar or for
any Fund or to make any representations on Quasar's or the Funds' behalf. Dealer
acknowledges that this Agreement is not exclusive and that Quasar may enter into
similar arrangements with other broker-dealers.
15. Term, Termination, Assignment and Amendment.
(a) This Agreement shall commence on the date first set forth above and
shall continue in effect with respect to a Fund for more than one year only so
long as such continuance is specifically approved at least annually in
conformity with the requirements of the 1940 Act.
(b) Either party to this Agreement may terminate this Agreement by giving
ten days' written notice to the other.
(c) This Agreement shall terminate automatically with respect to any Fund
if (i) Dealer files a petition in bankruptcy, (ii) a trustee or receiver is
appointed for Dealer or its assets under federal bankruptcy laws, (iii) Dealer's
registration as a broker-dealer with the Securities and Exchange Commission is
suspended or revoked, (iv) Dealer's NASD membership is suspended or revoked, (v)
an application for a protective decree under the provisions of the Securities
Investor Protection Act of 1970 is filed against Dealer, or (vi) the
Distribution Agreement between Quasar and a Fund is terminated (including as a
result of an assignment). This Agreement also shall terminate automatically in
the event of its "assignment," within the meaning of the 1940 Act.
(d) Termination of this Agreement by operation of this Paragraph 15 shall
not affect any unpaid obligations under Paragraphs 3, 5 or 6 of this Agreement
or the liability, legal and indemnity obligations set forth under Paragraphs 7,
8, 9 or 13 of this Agreement.
(e) This Agreement may be amended by Quasar upon written notice to Dealer,
and Dealer shall be deemed to have consented to such amendment upon effecting
any purchases of Shares for its own account or on behalf of any Customer's
accounts following Dealer's receipt of such notice.
16. Notices. Except as otherwise specifically provided in this Agreement,
any notice required or permitted to be given by either party to the other shall
be in writing and shall be deemed to have been given on the date delivered
personally or by courier service or 3 days after sent by registered or certified
mail, postage prepaid, return receipt requested or on the date sent and
confirmed received by facsimile transmission to the other party's address set
forth below:
Notice to Quasar shall be sent to:
Quasar Distributors, LLC
Attn: Dealer Agreement Department
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
notice to Dealer shall be sent to:
_______________________________
_______________________________
_______________________________
notice to Xxxxxxxx Invesment Management, LLC
Xxxxxxxx Invesment Management, LLC
Attn:
1200 Xxxx X. Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
17. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
18. Governing Law. This Agreement shall be construed in accordance with
the laws (without regard, however, to conflicts of law principles) of the State
of Wisconsin, provided that no provision shall be construed in a manner not
consistent with the 1940 Act or any rule or regulation thereunder.
19. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, or any breach thereof, shall be settled by arbitration in
acordance with the then existing NASD Code of Arbitration Procedure. Any
arbitration shall be conducted in Milwaukee, Wisconsin, and each arbitrator
shall be from the securities industry. Judgment upon the award rendered by the
arbitrators may be entered in any court having jurisdiction thereof.
20. Confidentiality. Quasar and Dealer agree to preserve the
confidentiality of any and all materials and information furnished by either
party in connection with this Agreement. The provisions of this Paragraph shall
not apply to any information which is: (a) independently developed by the
receiving party, provided the receiving party can satisfactorily demonstrate
such independent development with appropriate documentation; (b) known to the
receiving party prior to disclosure by the disclosing party; (c) lawfully
disclosed to the receiving party by a third party not under a separate duty of
confidentiality with respect thereto to the disclosing party; or (d) otherwise
publicly available through no fault or breach by the receiving party.
In accordance with Regulation S-P, the parties hereto will not disclose
any non-public personal information, as defined in Regulation S-P,
regarding any Customer; provided, however, that Dealer or Quasar may
disclose such information to any party as necessary in the ordinary course
of business to carry out the purposes for which such information was
disclosed to Dealer or Quasar, or as may be required by law. Both parties
agrees to use reasonable precautions to protect and prevent the
unintentional disclosure of such non-public personal information.
21. Anti-Money Laundering Program. Dealer represents and warrants that it
has adopted an anti-money laundering program ("AML Program") that complies with
the Bank Secrecy Act, as amended by the USA PATRIOT Act, and any future
amendments (the "PATRIOT Act," and together with the Bank Secrecy Act, the
"Act"), the rules and regulations under the Act, and the rules, regulations and
regulatory guidance of the SEC, the NASD or any other applicable self-regulatory
organization (collectively, "AML Rules and Regulations"). Dealer further
represents that its AML Program, at a minimum, (1) designates a compliance
officer to administer and oversee the AML Program, (2) provides ongoing employee
training, (3) includes an independent audit function to test the effectiveness
of the AML Program, (4) establishes internal policies, procedures, and controls
that are tailored to its particular business, (5) will include a customer
identification program consistent with the rules under section 326 of the Act,
(6) provides for the filing of all necessary anti-money laundering reports
including, but not limited to, currency transaction reports and suspicious
activity reports, (7) provides for screening all new and existing customers
against the Office of Foreign Asset Control ("OFAC") list and any other
government list that is or becomes required under the Act, and (8) allows for
appropriate regulators to examine Dealer's AML books and records.
22. Market Timing. Dealer represents that it has and will maintain
policies and procedures to detect and prevent any market timing transaction that
contravenes the restrictions or prohibitions on market timing, if any, as found
in the then current Funds' prospectus and/or statement of additional
information. Dealer acknowledges that it is responsible for the sales activities
of its licensed representatives including, among other things, improper trading
activity in violation of the terms and conditions of the Fund's then current
prospectus.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated as of the day and year first written
above.
QUASAR DISTRIBUTORS, LLC
By:
---------------------------------
Type Name: Xxxxx Xxxxxxxxx, President
DEALER
By:
---------------------------------
Type Name:
--------------------------
XXXXXXXX INVESTMENT MANAGEMENT, LLC
(solely with respect to Section 5 hereto)
By:
---------------------------------
Type Name:
--------------------------
Schedule A
Names of Funds
Alpha N/W NASDAQ Transfer
NSCC # Code MUTUAL FUND F/S Level Cusip # Symbol Load Agent Telephone
XXXXXXXX
PLUMB FUNDS
5557 A3 Bond Fund Yes All 884891201 THOPX None USBFS 000-000-0000
5557 A3 Growth Fund Yes All 884891300 THPGX None USBFS 000-000-0000
