SALES AGREEMENT
BETWEEN
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AND
QUASAR DISTRIBUTORS, LLC
THIS AGREEMENT is entered into between ______________________
("Broker") and Quasar Distributors, LLC ("Quasar") for the sale of shares (the
"Shares) of the Jefferson Growth and Income Fund, the Jefferson REIT Fund and
all other funds that are or may become a series of The Jefferson Fund Group
Trust (together, the "Funds" and each, a "Fund") for which Quasar serves as
distributor.
1. STATUS OF BROKER AS "REGISTERED BROKER-DEALER".
Broker represents and warrants to Quasar that it is a broker-dealer
registered with the Securities and Exchange Commission and a member of the
National Association of Securities Dealers, Inc. ("NASD"). It agrees to abide by
all of the rules and regulations of the NASD including, without limitation, the
NASD's Conduct rules. Broker agrees to notify Quasar immediately in the event of
(i) its expulsion or suspension from the NASD, or (ii) its being found to have
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. Broker's expulsion from the NASD will automatically
terminate this Agreement immediately without notice. Suspension of Broker from
the NASD for violation of any applicable federal or state law, rule or
regulation will terminate this Agreement effective immediately upon Quasar's
written notice of termination to Broker.
2. BROKER ACTS AS AGENT FOR ITS CUSTOMEXS.
The parties agree that in each transaction in the Shares: (a) Broker
is acting as agent for the customer; (b) each transaction is initiated solely
upon the order of the customer; (c) as between Broker and its customer, the
customer will have full beneficial ownership of all Shares; (d) each transaction
shall be for the account of the customer and not for Broker's account; and (e)
each transaction shall be without recourse to Broker provided that Broker acts
in accordance with the terms of this Agreement. Broker shall not have any
authority in any transaction to act as Quasar's agent or as agent for the Funds.
3. EXECUTION OF ORDERS FOR PURCHASE AND REDEMPTION OF SHARES.
(a) All orders for the purchase of any Shares shall be executed at the
then-current public offering price per share (i.e., the net asset value per
share plus the applicable sales load, if any) and all orders for the
redemption of any Shares shall be
executed at the net asset value per share, plus any applicable contingent
deferred sales load, in each case as described in the then-current
prospectus(es), including any supplements or amendments thereto, of the
Funds (the "Prospectus"), Quasar and the Funds reserve the right to reject
any purchase request at their sole discretion. If required by law, each
transaction shall be confirmed in writing on a fully disclosed basis and,
if confirmed by Quasar, a copy of each confirmation shall be sent
simultaneously to Broker if Broker so requests.
(b) The procedures relating to all orders and the handling of them
will be subject to the terms of the Prospectus of the Funds and Quasar's
written instructions to Broker from time to time.
(c) Payments for Shares shall be made as specified in the Funds'
Prospectus. If payment for any purchase order is not received in accordance
with the terms of the Funds' Prospectus, Quasar reserves the right, without
notice, to cancel the sale and to hold Broker responsible for any loss
sustained as a result thereof.
(d) Broker agrees to provide such security as is necessary to prevent
any unauthorized use of the Funds' recordkeeping system, accessed via any
computer hardware or software provided to Broker by Quasar.
4. PAYMENT OF DEALER COMMISSION TO BROKER.
Quasar agrees to pay to Broker commissions on sales of Shares as set
forth in a written schedule delivered to Broker pursuant to this Agreement.
These fees may be changed at any time at Quasar's sole discretion upon thirty
(30) days written notice to Broker.
5. PAYMENT OF ADMINISTRATIVE FEES TO BROKER.
Broker agrees to render or cause to be rendered such administrative
support services to the Funds for the accounts of Broker's customers who are
shareholders of the Funds, as the parties mutually agree are necessary to
facilitate the opening and closing of accounts, entering of purchase and
redemption transactions, transferring of funds, recordkeeping and accounting,
distribution of Prospectuses and shareholder reports and communicating with
shareholders. During the term of this Agreement, Quasar will pay Broker fees
established by Quasar in a written schedule delivered to Broker pursuant to this
Agreement. These fees may be changed at any time at Quasar's sole discretion
upon thirty (30) days' written notice to Broker.
6. PAYMENT OF RULE 12B-1 FEES TO BROKER.
(a) Subject to and in accordance with the terms of the Funds'
Prospectus and the Rule 12b-1 Plan adopted by resolution of the Board of
Trustees and the shareholders of the Funds pursuant to Rule 12b-1 under the
Investment Company Act of 1940, Quasar may pay fees to securities dealers
providing services intended to result in sales of Shares. The services to
be provided may include, but are not limited to, the following:
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(i) communicating account openings through computer terminals
located on the Broker's premises ("computer terminals"),through a
toll-free telephone number or otherwise;
(ii) communicating account closings through the computer
terminals, through a toll-free telephone number or otherwise;
(iii) entering purchase transactions through the computer
terminals, through a toll-free telephone number or otherwise;
(iv) entering redemption transactions through the computer
terminals, through a toll-free telephone number or otherwise;
(v) electronically transferring and receiving funds for Fund
Share purchases and redemptions, and confirming and reconciling all
such transactions;
(vi) reviewing the activity in Fund accounts;
(vii) providing training and supervision of its personnel;
(viii) maintaining and distributing current copies of
Prospectuses and shareholder reports;
(ix) advertising the availability of its services and products;
(x) providing assistance and review in designing materials to
send to customers and potential customers and developing methods of
making such materials accessible to customers and potential customers;
and
(xi) responding to customers' and potential customers' questions
about the Fund.
The services listed above are illustrative. Broker is not required to perform
each service and may at any time perform either more or fewer services than
described above.
(b) During the term of the Agreement, Quasar will pay Broker fees as
set forth in a written schedule delivered to Broker pursuant to this
Agreement. Quasar's fee schedule for Broker may be changed by Quasar
sending a new fee schedule to Broker. For the payment period in which this
Agreement becomes effective or terminates, there shall be an appropriate
prorating of the fee on the basis of the number of days that this Agreement
is in effect during the period.
(c) Broker will not perform or provide any duties which would cause it
to be a fiduciary under Section 4975 of the Internal Revenue Code, as
amended. For purposes of that Section, Broker understands that any person
who exercises any discretionary authority or discretionary control with
respect to any individual retirement account or
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its assets, or who renders investment advice for a fee, or has any
authority or responsibility to do so, or has any discretionary authority or
discretionary responsibility in the administration of such an account, is a
fiduciary.
(d) Broker understands that the Department of Labor views ERISA as
prohibiting fiduciaries of discretionary ERISA assets from receiving
compensation from funds in which the fiduciary's discretionary ERISA assets
are invested. To date, the Department of Labor has not issued any exempting
order or advisory opinion that would exempt fiduciaries from this
interpretation. Without specific authorization from the Department of
Labor, fiduciaries should carefully avoid investing discretionary assets in
any fund pursuant to an arrangement where the fiduciary is to be
compensated by the fund for such investment. Receipt of such compensation
could violate ERISA provisions against fiduciary self-dealing and conflict
of interest and could subject the fiduciary to substantial penalties.
7. DELIVERY OF PROSPECTUS TO CUSTOMERS.
Broker will deliver or cause to be delivered to each customer, at or
prior to the time of any purchase of Shares, a copy of the Prospectus for the
applicable Fund. Broker shall make any representation concerning any Shares
other than those contained in the Prospectus of the Funds or in any promotional
materials or sales literature furnished to Broker by Quasar or the Funds.
8. INDEMNIFICATION.
(a) Broker shall indemnify and hold harmless Quasar, the Funds, the
transfer agent of the Funds, and their respective subsidiaries, affiliates,
officers, members, directors, agents and employees from all direct or
indirect liabilities, losses or costs (including attorney's fees) arising
from, related to or otherwise connected with: (1) any breach by Broker of
any provision of this Agreement; or (2) any actions or omissions of Quasar,
any Fund, the transfer agent of the Funds, and their subsidiaries,
affiliates, officers, directors, agents and employees in reliance upon any
oral, written or computer or electronically transmitted instructions
believed to be genuine and to have been given by or on behalf of Broker.
(b) Quasar shall indemnify and hold harmless Broker and its
subsidiaries, affiliates, officers, directors, agents and employees from
and against any and all direct or indirect liabilities, losses or costs
(including attorney's fees) arising from, related to or otherwise connected
with: (1) any breach by Quasar of any provision of this Agreement; or (2)
any alleged or untrue statement of a material fact contained in the Funds'
registration statement or Prospectus, or as a result of or based upon any
alleged omission to state a material fact required to be stated, or
necessary to make the statements not misleading.
(c) The agreement of the parties' in this paragraph to indemnify each
other is conditioned upon the party entitled to indemnification
(Indemnified Party) giving notice
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to the party required to provide indemnification (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. 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 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.
(d) The provisions of this paragraph 8 shall survive the termination
of this Agreement.
9. CUSTOMER NAMES PROPRIETARY TO BROKER.
(a) The names of Broker's customers are and shall remain Broker's sole
property and shall not be used by Quasar or its affiliates for any purpose
except the performance of its duties and responsibilities under this
Agreement and except for servicing and informational mailings relating to
the Fund. Notwithstanding the foregoing, this paragraph 9 shall not
prohibit Quasar or any of its affiliates from utilizing the names of
Broker's customers for any purpose if the names are obtained in any manner
other than from Broker pursuant to this Agreement.
(b) 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.
(c) The provisions of this paragraph 9 shall survive the termination
of this Agreement.
10. SOLICITATION OF PROXIES.
Broker agrees not to solicit or cause to be solicited directly, or
indirectly, at any time in the future, any proxies from the shareholders of the
Funds in opposition to proxies solicited by management of the Funds, unless a
court of competent jurisdiction shall have determined that the conduct of a
majority of the Trustees of the Funds constitutes willful misfeasance, bad
faith, gross negligence or reckless disregard of their duties. This paragraph 10
will survive the term of this Agreement.
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11. CERTIFICATION OF CUSTOMER'S TAXPAYER IDENTIFICATION NUMBERS.
Broker agrees to obtain any taxpayer identification number
certification from its customers required under Section 3406 of 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.
12. NOTICES.
Except as otherwise specifically provided in this Agreement, all
notices required or permitted to be given pursuant to this Agreement shall be
given in writing and delivered by personal delivery or by postage prepaid,
registered or certified United States first class mail, return receipt
requested, or the telex, telegram or similar means of same day delivery (with a
confirming copy by mail as provided herein). Unless otherwise notified in
writing, all notices to Quasar shall be given or sent to Quasar at its offices
located at 000 Xxxx Xxxxxxxx Xxxxxx, 0xx xxxxx, Xxxxxxxxx, Xxxxxxxxx 00000, and
all notices to Broker shall be given or sent to it at its address shown below.
13. TERMINATION AND AMENDMENT.
(a) This Agreement shall continue in effect for one year from the
date of its execution, and thereafter for successive periods of one year if
the form of this Agreement is approved at least annually by the Trustees of
the Funds including a majority of the Trustees who are not interested
persons of the Funds and have no direct or indirect financial interest in
the operation of the Fund's 12b-1 Plan or in any related documents to the
12b-1 Plan ("Disinterested Trustees") cast in person at a meeting called
for that purpose.
(b) Notwithstanding subparagraph (a), this Agreement may be
terminated as follows:
(i) at any time, without the payment of any penalty, by the
vote of a majority of the Disinterested Trustees of the Trust or
by a vote of a majority of the outstanding voting securities of
the Funds as defined in the Investment Company Act of 1940 on not
more than sixty (60) days' written notice to the parties to this
Agreement;
(ii) automatically in the event of the Agreement's
assignment as defined in the Investment Company Act of 1940 or
upon the termination of any Underwriting Agreement between any
Fund and Quasar; and
(iii) by either party to the Agreement without cause by
giving the other party at least sixty (60) days' written notice
of its intention to terminate.
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(c) This Agreement may be amended by Quasar from time to time by the
following procedure. Quasar will mail a copy of the amendment to Broker's
address, as shown below. If Broker does not object to the amendment within
thirty (30) days after its receipt, the amendment will become part of the
Agreement. Broker's objection must be in writing and be received by Quasar
within such thirty (30) days.
14. PRIOR AGREEMENTS.
This Agreement supersedes any prior service agreements between the
parties for the Fund.
15. GOVERNING LAW.
This Agreement shall be construed in accordance with the laws of the
State of Wisconsin.
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Broker Name
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Address
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City State Zip Code
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By: Date:
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Authorized Signature
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Title
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Please Print or Type Name
QUASAR DISTRIBUTORS, LLC
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By: Xxxxx Xxxxxxxxx; President
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1. Commission. In connection with original purchases of Shares, Distributor will
pay Broker commissions as follows:
(a) For sales of Class A Shares, Broker shah receive a one-time fee,
based on the value of an individual sale, in accordance with the following
table:
Sales Dealer Commission*
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$0 - 9,999 4.75%
$10,000-24,999 3.75%
$25,000 - 49,000 3.00%
50,00 - 99,999 2.00%
100,000 - 499,999 1.00%
500,000 - 999,999 0.75%
1,000,000+ 0.25%
* As a percentage of the public offering price.
(b) For sales of Class B Shares, Broker shall receive a one-time fee
of 4% of the original offering price of such shares.
(c) The fees described in (a) and (b) above shall only be payable with
respect to the original purchase of Shares and shall not be paid for Shares
acquired through dividend reinvestment. The fee will be paid by Distributor
by the tenth business day of the month following the month in which the
Shares are purchased.
2. Trailer. Distributor will pay Broker an annual fee calculated at
the annual rate of .25% of the aggregate daily net asset value of Class A Shares
and/or Class B Shares held in an individually titled account that have been so
held for a minimum of 365 days after the settlement date of the purchase of such
Shares. The first installment of the annual fee shall be payable by the tenth
business day of the calendar quarter end following the month in which the Shares
shall have been so held for 365 days. For purposes of determining the annual fee
payable pursuant to this paragraph 2, "Shares held in an individually titled
account that have been so held for a minimum of 365 days" shall include all
Shares originally purchased plus Shares acquired through the reinvestment of
dividends paid with respect to such Shares. For the month in which payments
pursuant to this paragraph 2 commence, there shall be an appropriate prorating
of the fee on the basis of the number of days in the month following the
aforesaid 365th day or on the basis of the number of days that the account or
Sales Agreement is in effect during the month, as the case may be. No fee will
be paid to the Broker in the month in which the account or Sales Agreement
terminates.
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