ADVANTUS FUNDS
DEALER SALES AGREEMENT
THIS AGREEMENT, made this _____ day of ________________, 19___, by and
between MIMLIC Sales Corporation, a Minnesota corporation (the
"Underwriter"), having its principal office at 000 Xxxxxx Xxxxxx Xxxxx, Xx.
Xxxx, Xxxxxxxxx, 00000, and ________________ (the "Dealer") having its
principal office at ___________________________________________.
WHEREAS, the Underwriter has entered into Distribution Agreements with
certain registered management investment companies (the "Funds"), as listed
on Schedule A hereto and made a part hereof, which Schedule A may be amended
without notice from time to time by the Underwriter, under which the
Underwriter has been engaged and agreed to act as principal underwriter for
the Funds in the sale and distribution of shares of the Funds to the public,
either through dealers or otherwise; and
WHEREAS, the parties hereto desire that the Dealer be a member of a
selling group to sell and distribute shares of the Funds to the public;
NOW, THEREFORE, the Dealer hereby offers to become a member in a
selling group to sell and distribute shares of the Funds to the public
subject to the following terms and conditions.
1. ACCEPTANCE OF SUBSCRIPTIONS; REGISTRATION STATEMENT; PROSPECTUS.
Subscriptions solicited by the Dealer will be accepted only in the amounts
and on the terms which are set forth in the then current Prospectus (and/or
Statement of Additional Information, if any) for the Funds. Underwriter
represents and warrants that the Prospectus (and/or Statement of Additional
Information, if any) for the Funds shown on Schedule A are or will be filed
with the Securities and Exchange Commission ("SEC"), that such filings
conform in all material respects with the requirements of the SEC and that,
except as Underwriter has given written notice to Dealer, there is an
effective Registration Statement relating to such Funds. Underwriter shall
give written notice to Dealer either (i) of specified states or jurisdiction
in which the Funds may be offered and sold by the Dealer or (ii) of all
states or jurisdictions where the Funds may not be offered or sold, but
Underwriter does not assume any responsibility as to the Dealer's right to
sell the Funds in any state or jurisdiction. Underwriter, during the term of
this Agreement, shall (i) notify Dealer in writing of the issuance by the SEC
of any stop order with respect to a Registration Statement or the initiation
of any proceedings for such purpose or any other purpose relating to the
registration and/or offering of the Funds, (ii) of any other action or
circumstance known to them that may prevent the lawful sale of the Funds in
any state or jurisdiction, and (iii) advise the
Dealer in writing of any amendment to the Registration Statement or
supplement to any Prospectus. The Underwriter shall make available to Dealer
such number of copies of the Prospectus (as amended or supplemented) (and/or
Statements of Additional Information, if any) or any supplemental sales
literature created by the Underwriter as the Dealer may reasonably request.
2. DEALER DISCOUNT AND OTHER COMPENSATION. The dealer shall receive,
for sales of shares of the Funds' common stock, the applicable Dealer
Discount or other compensation as set forth in Schedule A attached hereto and
made a part hereof. Additionally, with respect to certain of the Funds, the
Dealer may be entitled to receive additional compensation upon such terms and
conditions and in such amounts as set forth in Schedule A hereto for
providing to Fund shareholders certain personal and account maintenance
services (including, but not limited to, responding to shareholder inquiries
and providing information on their investments) not otherwise required to be
provided by the applicable Funds' investment adviser or transfer agent
("Service Fees") or (in addition to the aforementioned Dealer Discount) for
sales of shares of the applicable Fund's common stock ("Distribution Fees").
Schedule A may be amended in whole or in part without notice from time to
time by the Underwriter.
3. ORDERS. Orders to purchase shares of the Funds shall be placed as
described in the then current Prospectus (and/or Statement of Additional
Information, if any) of the Funds and as instructed from time to time by the
Underwriter. Orders shall be placed promptly upon receipt, and there shall
be no postponement of orders received so as to profit the Dealer by reason of
such postponement. Each order shall be confirmed by the Dealer to the
Underwriter in writing on the day such order was placed.
All monies or other settlements received by the Dealer for or on
behalf of the Underwriter shall be received by the Dealer in fiduciary
capacity in trust for the Underwriter and shall be immediately transmitted to
the Underwriter, and, in no event, shall the Dealer commingle such monies
with other funds. The Dealer shall keep correct accounts and records of all
business transacted and monies collected by him for the Underwriter to the
extent required by the Underwriter, which accounts and records shall be open
at all times to inspection and examination by the Underwriter's authorized
representative. All accounts, records and any supplies furnished to the
Dealer by the Underwriter shall remain the property of the Underwriter and
shall be returned to the Underwriter upon demand.
4. FAILURE OF ORDER. The Underwriter reserves the right at any time
to refuse to accept and approve any application for the purchase of shares of
the Funds obtained by the Dealer, and also reserves the right to settle any
claims against the Underwriter arising from the sale of shares of the Funds
by the Dealer and to refund to the investor payments made by him on his
shares, without the Dealer's consent. In the event any order for the
purchase of shares of the Funds is rejected by the Underwriter or any payment
received for the purchase of shares of the Funds cannot be collected or
otherwise proves insufficient or worthless, any compensation paid to the
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Dealer hereunder shall, promptly upon notice to the Dealer, be returned by
the Dealer to the Underwriter either in cash or as a charge against the
Dealer's account with the Underwriter, as the Underwriter may elect, and the
Dealer hereby agrees that until the Underwriter receives full reimbursement
in cash, the amount of compensation due and owing the Underwriter shall
constitute a debt to the Underwriter which the Underwriter may collect by any
lawful means, with interest thereon at the maximum rate possible.
5. GENERAL. In soliciting purchases of shares of the Funds, the
Dealer shall act as an independent contractor and not on behalf or subject to
the control of the Underwriter. Nothing herein shall constitute the Dealer
as a partner of the Underwriter, any other broker-dealer, any registered
representative of the Underwriter or the Funds, or render any such entity
liable for obligations of the Dealer. The Dealer understands that Dealer has
no authority to incur any expenses or obligations in the name of the
Underwriter, and Dealer agrees to indemnify and save the Underwriter harmless
from any and all expenses, or obligations incurred by Dealer in the name of
the Underwriter for which Dealer is responsible. Dealer agrees to pay all
expenses incurred by Dealer in connection with Dealer's work. The Dealer's
participation in the sale and distribution of shares of the Funds as
contemplated by this Agreement is not exclusive and the Underwriter may
engage other broker-dealers and/or its registered representatives to
participate in the sale and distribution of shares of the Funds on terms and
conditions which may differ from the terms and conditions of this Agreement.
The Dealer understands and agrees that each shareholder account which
includes shares of any Fund subject to the Fund's contingent deferred sales
charge (as described in the applicable Fund's current Prospectus and
Statement of Additional Information) shall not be included in the Dealer's
omnibus or house account, if any, but shall be established as a separate
shareholder account in which purchase and redemption transactions are
reported separately to the Underwriter.
6. DEALER'S UNDERTAKINGS. No person is authorized to make any
representation concerning shares of the Funds except those contained in the
then current Prospectus (and/or Statement of Additional Information, if any).
The Dealer shall not sell shares of the Funds pursuant to this Agreement
unless the then current Prospectus is furnished to the purchaser prior to the
offer and sale. The Dealer shall not use any supplemental sales literature
of any kind without prior written approval of the Underwriter unless it is
furnished by the Underwriter for such purpose. In offering and selling
shares of the Funds, the Dealer shall rely solely on the representations
contained in the then current Prospectus (and/or Statement of Additional
Information, if any). In offering and selling shares of the Funds, the
Dealer shall comply with all applicable state and federal laws and
regulations and all applicable rules of the National Association of
Securities Dealers, Inc. (the "NASD"). In the event of the suspension,
revocation, cancellation or other impairment of the Dealer's membership in
the NASD or the Dealer's registration, license or qualification to sell
shares of the Funds under any applicable state or federal law or regulation,
the Dealer shall give the Underwriter prompt notice of such
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suspension, revocation, cancellation or other impairment, and the Dealer's
authority under this Agreement shall thereupon terminate as provided in
paragraph 12.
With respect to any Fund offering multiple classes of shares, the
Dealer shall disclose to prospective investors the existence of all available
classes of such Fund and shall determine the suitability of each available
class as an investment for each such prospective investor.
7. REPRESENTATIONS AND AGREEMENTS OF THE DEALER. By accepting this
Agreement, the Dealer represents that it: (i) is registered as a
broker-dealer under the Securities Exchange Act of 1934, as amended; (ii) is
qualified to act as a dealer in each jurisdiction in which it will offer
shares of the Funds; (iii) is a member in good standing of the NASD; and (iv)
will maintain such registrations, qualifications and memberships throughout
the term of this Agreement.
8. DEALER'S EMPLOYEES. By accepting this Agreement, the Dealer
assumes full responsibility for the actions and course of conduct of its
registered representatives in the solicitation of purchases of shares of the
Funds. The Dealer shall provide thorough and prior training to its
registered representatives concerning the selling methods to be used in
connection with the offer and sale of shares of the Funds, giving special
emphasis to the principles of full and fair disclosure to prospective
investors. The Dealer may solicit sales of shares of the Funds only through
properly licensed registered representatives of the Dealer.
9. INDEMNIFICATION BY UNDERWRITER. The Underwriter hereby agrees to
indemnify and to hold harmless the Dealer and each person, if any, who
controls the Dealer within the meaning of Section 15 of the Securities Act of
1933 (the "Act") and their respective successors and assigns (hereinafter in
this paragraph separately and collectively referred to as the "Defendants")
from and against any and all losses, claims, demands or liabilities (or
actions in respect thereof), joint or several, to which the Defendants may
become subject under the Act, at common law or otherwise (including any legal
or other expense reasonably incurred in connection therewith), insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue or allegedly untrue statement of a
material fact contained in the then current Prospectus (and/or Statement of
Additional Information, if any) of the Funds or arise out of or are based
upon the omission or alleged omission to state therein a material fact that
is required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;
provided that this indemnity agreement is subject to the condition that
notice be given as provided below. Upon the presentation in writing of any
claim or the commencement of any suit against any Defendant in respect of
which indemnification may be sought from the Underwriter on account of its
agreement contained in the preceding sentence, such Defendant shall with
reasonable promptness give notice in writing of such suit to the Underwriter,
but failure so to give such notice shall not relieve the Underwriter from any
liability that it may have to the Defendants otherwise than on account of
said indemnity agreement. The Underwriter shall be entitled to participate
at its own expense in the defense, or, if it so elects, to assume the defense
of any such claim or suit, but if
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the Underwriter elects to assume the defense, such defense shall be conducted
by counsel chosen by it and satisfactory to the Defendants who are parties to
such suit or against whom such claim is presented. If the Underwriter elects
to assume the defense and retain such counsel as herein provided, such
Defendant shall bear the fees and expenses subsequently incurred of any
additional counsel retained by them, except the reasonable costs of
investigation and such other costs as are approved by the Underwriter;
provided, that if counsel for an indemnified Defendant determines in good
faith that there is a conflict which requires separate representation for the
indemnified Defendant, the indemnified Defendant shall be entitled to
indemnification for the reasonable expenses of one additional counsel and
local counsel to the extent provided above. Such counsel shall, to the
fullest extent consistent with its professional responsibilities, cooperate
with the Underwriter and its counsel. The Underwriter agrees to notify the
Dealer promptly, as soon as it has knowledge thereof, of the commencement of
any litigation or proceedings against the Underwriter or the Funds or any of
their directors or officers, in connection with the offer or sale of shares
of the Funds to the public. The Underwriter's obligation under this
paragraph shall survive the termination of this Agreement.
10. FIDELITY BOND OF DEALER AND INDEMNIFICATION BY DEALER. Dealer
represents that all directors, officers, partners, employees or registered
representatives of Dealer who are authorized pursuant to this Agreement to
sell shares of the Funds or who have access to monies belonging to the
Underwriter, including but not limited to monies submitted with applications
for purchase of shares of the Funds or monies being returned to investors,
are and shall be covered by a blanket fidelity bond, including coverage for
larceny and embezzlement, issued by a reputable bonding company. This bond
shall be maintained by Dealer at Dealer's expense. Such bond shall be at
least of the form, type and amount required under the NASD Rules of Fair
Practice. The Underwriter may require evidence, satisfactory to it, that
such coverage is in force. Dealer shall give prompt written notice to the
Underwriter of any notice of cancellation or change of coverage with respect
to such bond. Dealer hereby assigns any proceeds received from the fidelity
bonding company to the Underwriter to the extent of the Underwriter's loss
due to activities covered by the bond. If there is any deficiency amount,
whether due to a deductible or otherwise, Dealer shall promptly pay to the
Underwriter such amount on demand, and Dealer hereby indemnifies and holds
harmless the Underwriter from any such deficiency and from the costs of
collection thereof, including reasonable attorneys fees.
Dealer also agrees to indemnify and hold harmless the Underwriter and
its officers, directors and employees and each person who controls them
within the meaning of Section 15 of the Securities Act of 1933 (hereinafter
in this paragraph referred to as Defendants) against any and all losses,
claims, damages or liabilities, including reasonable attorneys fees, to which
they may become subject under the Securities Act of 1933, the Securities
Exchange Act of 1934, or other federal or state statutory law or regulation,
at common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon:
(i) any oral or written misrepresentation, any unauthorized action or
statement, or any other willful, reckless or negligent violation of any law,
regulation, contract or other arrangement by Dealer or its officers,
directors, employees or agents, or (ii) the failure of Dealer or its
officers, directors, employees or agents to comply with any applicable
provisions of this Agreement;
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provided, that this indemnity agreement is subject to the condition that
notice be given as provided below. Upon the presentation in writing of any
claim or the commencement of any suit against any Defendant in respect of
which indemnification may be sought from the Dealer on account of its
agreement contained in the preceding sentence, such Defendant shall with
reasonable promptness give notice in writing of such suit to the Dealer, but
failure to so give such notice shall not relieve the Dealer from any
liability that it may have to the Defendants otherwise than on account of
this indemnity agreement. The Dealer shall be entitled to participate at its
own expense in the defense, or, if it so elects, to assume the defense of any
such claim or suit with counsel chosen by it and satisfactory to the
defendants who are parties to such suit or against whom such claim is
presented. If the Dealer elects to assume the defense and retain such
counsel as herein provided, such Defendant shall bear the fees and expenses
subsequently incurred of any additional counsel retained by them, except the
reasonable costs of investigation and such other costs as are approved by the
Dealer; provided, that if counsel for an indemnified Defendant determines in
good faith that there is a conflict which requires separate representation
for the indemnified Defendant, the indemnified Defendant shall be entitled to
indemnification for the reasonable expenses of one additional counsel and
local counsel to the extent provided above. Such counsel shall, to the
fullest extent consistent with its professional responsibilities, cooperate
with the Dealer and its counsel. The Dealer's obligations under this
paragraph shall survive the termination of this Agreement.
11. ASSIGNMENT AND TERMINATION. This Agreement may not be assigned by
the Dealer without consent of the Underwriter.
12. TERMINATION. Either party may terminate this Agreement at any
time upon giving written notice to the other party hereto. This Agreement
shall terminate automatically in the event of the suspension, revocation,
cancellation or other impairment of the Dealer's membership in the NASD or
the Dealer's registration, license or qualification to sell shares of the
Funds under any applicable state or federal law or regulation.
13. FIRST CLAIM ON EARNINGS AND LEGAL PROCEEDINGS. Underwriter shall
have first claim on all of Dealer's earnings under this Agreement. This
means that Underwriter as and when it elects may keep all or any part of such
earnings to reduce any debt Dealer owes Underwriter. While Underwriter may
release Dealer's earnings while Dealer owes a debt to Underwriter, this does
not mean Underwriter has waived this right of first claim to Dealer's
earnings. Underwriter's claim also takes precedence over claims of Dealer's
creditors. All Dealer's earnings kept by Underwriter will be used to reduce
debt owed to Underwriter. Dealer has no right to start any legal proceedings
on Underwriter's behalf or in its name.
14. NOTICE. Any notice to be given to a party hereto pursuant to this
Agreement shall be in writing, addressed to such party at the address of such
party set forth in the preamble hereof, or such other address as such other
party may from time to time designate in writing to the party
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hereto giving notice. Any notice delivered by the mails, postage fully
prepaid, shall be deemed to have been given five (5) days after mailing or,
if earlier, upon receipt.
15. WAIVER. No failure, neglect or forbearance on the part of the
Underwriter to require strict performance of this Agreement shall be
construed as a waiver of the rights or remedies of the Underwriter hereunder.
16. SUSPENDING SALES, AMENDING OR CANCELING THIS AGREEMENT. The
Underwriter may, at any time, without notice, suspend sales or withdraw any
offering of shares entirely. The Underwriter reserves the right to amend or
cancel this Agreement upon notice to Dealer. The Dealer agrees that any
order to purchase shares of Funds placed after notice of any amendment to
this Agreement has been sent to the Dealer shall constitute the Dealer's
agreement to any such amendment.
17. GOVERNING LAW. This Agreement shall be construed in accordance
with the laws of the State of Minnesota.
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DEALER:
_____________________________________ _____________________________________
(Name) (NSCC Clearing Number)
_____________________________________ _____________________________________
(Tax Identification Number) (NSCC Executing Broker Symbol)
_____________________________________ _____________________________________
(Street Address) (Telephone Number)
_____________________________________
(City) (State) (Zip)
Date of offer: ____________, 19___
By ______________________________________________________________
(Signature)
Please Print Name __________________________________________________
Its_______________________________________________________________
(Title)
Accepted by
MIMLIC SALES CORPORATION
Date of acceptance: _____________________, 19___
By ______________________________________________________________
(Signature)
Its_______________________________________________________________
(Title)
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SCHEDULE A
Dealer Compensation Schedule
Effective March 1, 1995
I. Advantus Horizon Fund, Inc.
Advantus Mortgage Securities Fund, Inc.
Advantus Spectrum Fund, Inc.
Advantus Bond Fund, Inc.
Advantus Cornerstone Fund, Inc.
Advantus Enterprise Fund, Inc.
Advantus International Balanced Fund, Inc.
(International Fund offers only Class A and Class C Shares.)
A. Dealer Commissions
Dealer Concession as
Percentage of Offering Price
------------------------------
Class A Class B Class C
Amount of Sale Shares Shares Shares
-------------- ------- ------- -------
Less than $50,000 4.50% 3.75% -0-
$50,000 but less
than $100,000 4.05 3.38 -0-
$100,000 but less
than $250,000 3.15 2.63 -0-
$250,000 but less
than $500,000 2.25 1.88 -0-
$500,000 but less
than $1,000,000 1.35 1.13 -0-
$1,000,000 and over .9* n/a* n/a*
* Orders of $1,000,000 or more will be accepted only for Class A Shares.
MIMLIC does not receive a sales load on sales of Class A Shares of $1,000,000
or more. The Dealer will receive the commission indicated on such sales;
provided, however, that if the customer redeems any portion of such
investment within 18 months after purchase, the pro rated commission paid on
the portion redeemed shall be charged back against the Dealer's compensation
account in an amount determined as follows:
Percentage of Commission Month After Sale
Charged Back When Redemption Occurs
------------ ----------------------
100% 0-6
66 2/3 7-12
33 1/3 13-18
B. Distribution and Service Fees
In addition to the Dealer Commissions, the Dealer shall receive
quarterly Distribution and/or Service Fees, equal to a percentage of
average daily net assets attributable to Shares held in accounts by
customers for whom the Dealer is the holder or agent of record or with
whom the Dealer maintains a servicing relationship in accordance with
the following table:
Distribution Fees Service Fees
----------------- ------------
Class A Class C Class B Class C
------- ------- ------- -------
1/4 of .25% 1/4 of .75% 1/4 of .25% 1/4 of .25%
II. Advantus Money Market Fund, Inc.
MIMLIC does not receive a sales load on sales of Advantus Money Market
Fund. Shares of Advantus Money Market Fund acquired in an exchange from
any of the other Advantus Funds may be exchanged at relative net asset
values for shares of any of the other Advantus Funds. Shares of Advantus
Money Market Fund not acquired in an exchange from any of the other
Advantus Funds may be exchanged at relative net asset values plus
applicable sales load for shares of any of the other Advantus Funds. In
the event Dealer's customer exchanges shares of Advantus Money Market Fund
for shares of another Advantus Fund and pays a sales load in connection
with such exchange, the Dealer shall receive a Dealer Discount as
described above.
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