EXHIBIT 6.2
SALES AGREEMENT
BETWEEN
AND
XXXXXX & XXXXXXX, INC.
THIS AGREEMENT is entered into between ----------------------------
("Broker") and Xxxxxx & Xxxxxxx, Inc. ("Xxxxxx") for Jefferson Growth and Income
Fund of The Jefferson Fund Group Trust (the "Fund") for which Xxxxxx serves as
Distributor of shares of capital stock ("Shares").
1. STATUS OF BROKER AS "REGISTERED BROKER-DEALER".
Broker represents and warrants to Xxxxxx 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 Rules of Fair Practice. Broker agrees to notify Xxxxxx 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 Xxxxxx'x written notice of termination to Broker.
2. BROKER ACTS AS AGENT FOR ITS CUSTOMERS.
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 Xxxxxx'x agent or as agent for the Fund.
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 prospectus of the Fund. Xxxxxx and the Fund 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 Xxxxxx, 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 Fund and Xxxxxx'x
written instructions to Broker from time to time.
(c) Payments for Shares shall be made as specified in the Fund's
prospectus. If payment for any purchase order is not received in
accordance with the terms of the Fund's prospectus, Xxxxxx 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 Fund's recordkeeping system, accessed via any
computer hardware or software provided to Broker by Xxxxxx.
4. PAYMENT OF DEALER COMMISSION TO BROKER.
Xxxxxx 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 Xxxxxx'x 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 Fund for the accounts of Broker's customers who are
shareholders of the Fund, 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, Xxxxxx will pay Broker fees
established by Xxxxxx in a written schedule delivered to Broker pursuant to this
Agreement. These fees may be changed at any time at Xxxxxx'x 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 Fund's
prospectus and the Rule 12b-1 Plan adopted by resolution of the Board of
Directors and the shareholders of the Fund pursuant to Rule 12b-1 under the
Investment Company Act of 1940, Xxxxxx 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:
(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 closing 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, Xxxxxx will pay Broker fees as
set forth in a written schedule delivered to Broker pursuant to this
Agreement. Xxxxxx'x fee schedule for Broker may be changed by Xxxxxx
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 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 of the
Fund. Broker shall not make any representation concerning any Shares other than
those contained in the prospectus of the Fund or in any promotional materials or
sales literature furnished to Broker by Xxxxxx or the Fund.
8. INDEMNIFICATION.
(a) Broker shall indemnify and hold harmless Xxxxxx, the Fund, the
transfer agent of the Fund, and their respective subsidiaries, affiliates,
officers, 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: (a) any breach by Broker of any
provision of this Agreement; or (2) any actions or omissions of Xxxxxx, any
Fund, the transfer agent of the Fund, 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) Xxxxxx 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: (a) any breach by Xxxxxx of any provision of this Agreement; or (2)
any alleged or untrue statement of a material fact contained in the Fund's
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 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 for 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 Xxxxxx 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 Xxxxxx 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
Fund in opposition to proxies solicited by management of the Fund, unless a
court of competent jurisdiction shall have determined that the conduct of a
majority of the Trustees of the Trust constitutes willful misfeasance, bad
faith, gross negligence or reckless disregard of their duties. This paragraph
10 will survive the term of this Agreement.
11. CERTIFICATION OF CUSTOMERS' 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 Xxxxxx 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 Xxxxxx shall be given or sent to Xxxxxx at its offices
located at 000 X. XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 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 Trust, including a majority of the Trustees who are not interested
persons of the Trust 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 Fund 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 Distribution Assistance Agreement between the Fund and Xxxxxx;
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.
(c) This Agreement may be amended by Xxxxxx from time to time by the
following procedure. Xxxxxx 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 Xxxxxx
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 Illinois.
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Broker Name
(Please Print or Type)
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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
XXXXXX & XXXXXXX, INC.
By:
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Title
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Please Print or Type Name
FEE SCHEDULE FOR SELLING AGREEMENT
BETWEEN
AND
XXXXXX & XXXXXXX, INC.
1. Commission. In connection with original purchases of Shares, Xxxxxx will
pay Broker commissions as follows:
(a) For sales of Class A Shares, Broker shall receive a one-time fee,
based on the value of an individual sale, in accordance with the following
table:
Sales Dealer Commission*
$0 - 9,999 4.75%
$10,0000- 24,999 3.75%
$25,000 - 49,999 3.00%
$50,000 - 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
Xxxxxx by the tenth business day of the month following the month in which
the Shares are purchased.
2. Trailer. Xxxxxx will pay Broker an annual fee calculated at the annual
rate of .25% of the aggregate daily net asset value of a 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.
