SELECTED DEALER AGREEMENT
Ladies and Gentlemen: _____________, 199_
We, U.S. Growth Investments, Inc., a Minnesota corporation, have entered
into a distribution agreement with each registered, open-end management
investment company, or series thereof, set forth on EXHIBIT A hereto
(collectively, the "FUNDS") pursuant to which we act as distributor and
principal underwriter of each Fund's shares (the "SHARES").
1. THE OFFERING. The Shares will be offered continuously in
accordance with the terms and conditions set forth in each Fund's Prospectus
and Statement of Additional Information, as most currently amended or
supplemented (referred to hereinafter, together, as the applicable Fund's
"PROSPECTUS").
2. AUTHORIZED DEALERS. Pursuant to the distribution agreement between
each Fund and us, we have agreed to use our best efforts to enter into
arrangements with selected securities dealers to solicit from the public
orders to purchase Shares. You are hereby invited to become one of such
securities dealers (each such securities dealer, an "AUTHORIZED DEALER").
This will confirm our mutual agreement as to the terms and conditions
applicable to your participation as an Authorized Dealer, such agreement to
be effective on your confirmation hereof. You understand (a) that we may, at
any time at our option, also act as an Authorized Dealer, (b) that we are
seeking to enter into this Agreement in counterparts with you and certain
other securities dealers, which also may act as Authorized Dealers, (c) that,
except as we may otherwise agree with you, we may enter into agreements
(which may or may not be the same as this Agreement) with Authorized Dealers,
(d) that each Fund and we may modify, suspend, terminate or withdraw entirely
the offering of Shares at any time without giving notice to you pursuant to
Section 11 and without incurring any liability or obligation to you, (e) that
we may upon notice change the public offering price, sales load, or dealer
allowance or modify, cancel or change the terms of this Agreement, and (f) we
shall be under no liability to you except for lack of good faith and for
obligations expressly assumed by us herein. All purchases of Shares from,
and redemptions of Shares by, the applicable Fund shall be effected through
us acting as principal underwriters on behalf of the applicable Fund. (You
understand that we shall have no obligation to sell Shares to you at such
times as we are not acting as distributor and principal underwriter for the
applicable Fund.)
3. ROLE OF AUTHORIZED DEALERS. (a) As an Authorized Dealer, you
shall have no obligation to purchase or sell or to solicit the purchase or
sale of Shares. As, when and if you determine to purchase Shares or you
receive a customer order for the purchase of Shares and you determine to
accept such order, you shall comply with the procedures for the purchase of
Shares set forth in the applicable Fund's Prospectus. The procedure relating
to the handling of orders shall be subject to such further instructions as we
shall forward to you in writing from time to time.
(b) You agree to offer Shares to the public at the applicable public
offering price and subject to the minimum investment amount set forth in the
applicable Fund's Prospectus, subject to any waivers or reductions of sales
loads and dealer allowances described in the applicable Prospectus (as
amended or supplemented from time to time). Any amendment or supplement to
the applicable Prospectus which affects the sales load, dealer allowances,
waivers or discounts shall not affect sales load, dealer allowances,
discounts or waivers with respect to sales on which orders have been accepted
by us prior to the date of such amendment. Your placement of an order for
Shares after the date of any such amendment shall
conclusively evidence your agreement to be bound thereby. We shall make a
reasonable effort to notify you of any redetermination or suspension of the
public offering price, but we shall be under no liability for failure to do
so. Reduced sales loads may also be available as a result of a cumulative
discount or pursuant to a statement of intent as set forth in the Prospectus.
You agree to advise us promptly as to the amounts of any sales made by you
to the public qualifying for reduced sales loads.
(c) You agree to purchase Shares from us only to cover purchase orders
already received from your customers, or for your own bona fide investment.
You will not withhold placing with us orders received from your customers so
as to profit yourself as a result of such withholding. All orders for Shares
are subject to acceptance or rejection by us or the applicable Fund in the
sole discretion of either.
(d) In purchasing Shares through us, you shall rely solely on the
representations contained in the applicable Fund's Prospectus and the
applicable Fund's registration statement (as most recently amended, the
"REGISTRATION STATEMENT") relating to the Shares. You will not furnish to
any person any information relating to the Shares, the applicable Fund or us
that is inconsistent with information contained in the Prospectus, the
Registration Statement or any printed information issued by the Fund or us as
information supplemental to such Prospectus or cause any advertisement to be
published or posted in any public place without our prior written consent or
the prior written consent of the applicable Fund.
(e) In all sales of Shares to the public, you shall act as dealer for
your own account, whether as agent or principal. Nothing herein shall be
deemed to constitute you or any other Authorized Dealer as agent for the
Fund, us, or any other Authorized Dealer. You agree not to act as our agent
and not to claim to act as our agent or as agent of any of the foregoing.
You agree to buy Shares only through us and not from any other sources and to
sell Shares only to us, as the applicable Fund's redemption agent, and not to
any other purchasers.
(f) You agree that we shall have full authority to act upon your
express instructions to redeem or exchange Shares through us on behalf of
your customers under the terms and conditions provided in the applicable
Fund's Prospectus. You agree to hold us harmless as a result of any action
taken with respect to authorized redemptions or exchanges upon your express
instructions.
(g) If any Shares confirmed to you under the terms of this Agreement
are redeemed by the issuing Fund or by us as agent for the Fund, or are
tendered for redemption, within seven business days after the date of our
confirmation of the original purchase order, you shall forthwith refund to us
the full discount, commission, finder's fee or other concession, if any,
allowed or paid to you on such Shares.
(h) You understand and acknowledge that each Fund offers its Shares in
multiple classes, each subject to differing sales charges and financing
structures. You hereby represent and warrant that you have established
compliance procedures designed to ensure that your customers are made aware
of the terms of each available class of the applicable Fund's Shares, to
ensure that each customer is offered only Shares that are suitable
investments of that customer and to ensure proper supervision of your
registered representatives in recommending and offering multiple classes of
Shares to your customers.
(i) You understand and acknowledge that certain Shares may be subject
to a contingent deferred sales charge when such shares are redeemed. As to
such Shares, you agree either (A) to refrain from issuing such Shares in
street name, or (B) to monitor the time period during which the applicable
contingent deferred sales charges remains in effect, to deduct from any
redemption proceeds the applicable contingent deferred sales charges and to
promptly remit to us any such contingent deferred sales charges.
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4. COMPENSATION. You shall be entitled to receive such dealer
allowances, concessions, finder's fees and other compensation as are payable
to Authorized Dealers, generally, or to you or to certain specified
Authorized Dealers, specifically, as described and set forth in each
applicable Fund's Prospectus. You acknowledge that each Prospectus may set
forth a description of waivers or reduction of applicable sales loads and
dealer allowances in certain cases. In remitting the proceeds of any
investment in Shares to us or our agent (as provided herein), you are hereby
authorized to deduct from any such remittance the dealer allowance or
finder's fee applicable to the investment to which you are entitled (as
provided in the applicable Fund's Prospectus). As to any payments to be made
to you pursuant to any Rule 12b-1 plans adopted by the Funds, we shall remit
such amounts to you on a [quarterly] basis within [____] business days
following the end of the calendar quarter to which such payments relate;
provided, however, that no such Rule 12b-1 payments shall be due to you
unless and until we receive such payments from the applicable Fund.
5. ORDERS AND PAYMENT FOR SHARES. Payment for the Shares ordered from
us shall be made in Federal Funds and must be received by the Funds' agent,
[Norwest Bank Minnesota, N.A.], within three business days of a receipt and
acceptance by us of an order. If payment in Federal Funds is not received
within three business days after the execution of the order, we reserve the
right, without any notice, to cancel the sale and to hold you responsible for
any loss, including loss of profits, suffered by us or by the applicable Fund
resulting from such failure.
6. BLUE SKY AND OTHER QUALIFICATIONS. The Funds have registered an
indefinite number of Shares under the Securities Act of 1933. In addition,
the Funds intend to register or qualify in certain states where registration
or qualification is required. We will inform you as to the states or other
jurisdictions in which we believe the Shares have been qualified for sale
under, or exempt from the requirements of, the respective securities laws of
such states. You agree that you will offer Shares to your customers only in
those states where such Shares have been registered, qualified, or an
exemption is available. We assume no responsibility or obligation as to your
right to sell Shares in any jurisdiction.
7. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS. You represent and
warrant to and undertake that:
(a) You are familiar with all applicable federal and state
securities laws, rules and regulations relating to the distribution
and delivery of prospectuses and agree that you will comply
therewith. You agree to deliver thereafter to any purchaser whose
Shares you are holding as record holder copies of the annual and
interim reports and proxy solicitation materials relating to the
Shares. You further agree to make reasonable efforts to endeavor to
obtain proxies from such purchasers whose Shares you are holding as
record holder. Additional copies of each applicable Fund's
Prospectus, annual or interim reports and proxy solicitation
materials will be supplied to you as you reasonably request.
(b) You are a member in good standing of the National Association
of Securities Dealers, Inc. (the "NASD") or, if you are not such a
member, you are a foreign bank, dealer or institution not eligible
for membership in the NASD which agrees to make no sales within the
United States, its territories or its possessions or to persons who
are citizens thereof or residents therein, and in making other sales
to comply, as though you were a member of NASD, with the provisions
of Sections 8, 24 and 36 of Article III of the Rules of Fair Practice
of the NASD and with Section 25 thereof as that Section applies to a
non-NASD member broker or dealer in a foreign country.
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(c) You undertake to comply with respect to your offering of
Shares to the public pursuant to this Agreement with all applicable
provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and the Investment Company Act of
1940, as amended, and the rules and regulations thereunder and with
the applicable rules of the NASD.
8. TERMINATION. Either party to this Agreement may cancel this
Agreement by written notice to the other party. Such cancellation shall be
effective upon receipt of such notice.
9. REPRESENTATION TO SURVIVE. The agreements, representations,
warranties and other statements set forth in or made pursuant to this
Agreement will remain in full force and effect, to the extent permitted by
applicable law, regardless of any investigation made by or on behalf of us or
any Authorized Dealer. The provisions of Section 7 and 9 of this Agreement
shall survive the offer and sales of the Shares, to the extent permitted by
applicable law, and the termination or cancellation of this Agreement.
10. INDEMNIFICATION. (a) We agree to indemnify, defend and hold you,
your several officers and directors, and any person who controls you with the
meaning of Section 15 of the Securities Act of 1933, as amended, free and
harmless from and against any and all claims, demands liabilities and
expenses (including reasonable costs of investigating and defending such
claims, demands or liabilities and any reasonable counsel fees incurred in
connection therewith) which you, your officers or directors, or any such
controlling person, may incur under the Securities Act of 1933, as amended,
or under common law or otherwise, arising out of or based upon (i) any breach
of any representation, warranty or covenant made by us herein, (ii) any
failure by us to perform our obligations as set forth herein, or (iii) any
untrue statement, or alleged untrue statement, of a material fact contained
in any Registration Statement or any Prospectus, or arising out of or based
upon any omission, or alleged omission, to state a material fact required to
be stated in either any Registration Statement or any Prospectus, or
necessary to make the statements in any thereof not misleading; provided,
however, that our agreement to indemnify you, your officers and directors,
and any such controlling person shall not be deemed to cover any claims,
demands, liabilities or expenses arising out of any untrue statement or
alleged untrue statement or omission or alleged omission made in any
Registration Statement or Prospectus in reliance upon and in conformity with
information furnished to us or the applicable Fund by you for use in the
preparation thereof.
(b) You agree to indemnify, defend and hold us and our several officers
and directors, and each Fund and its several officers and directors or
trustees, and any person who controls you and/or each Fund within the meaning
of Section 15 of the Securities Act of 1933, as amended, free and harmless
from and against any and all claims, demands, liabilities and expenses
(including reasonable costs of investigating and defending such claims,
demands or liabilities and any reasonable counsel fees incurred in connection
therewith) which we and our several officers and directors, or the applicable
Fund and its officers and directors or trustees, or any such controlling
person, may incur under the Securities Act of 1933, as amended, or under
common law or otherwise, arising out of or based upon (i) any breach of any
representation, warranty or covenant made by you herein, or (ii) any failure
by you to perform your obligations as set forth herein, or (iii) any untrue,
or alleged untrue, statement of a material fact contained in the information
furnished by you to us or any Fund for use in such Fund's Registration
Statement or Prospectus, or used in the answers to any of the items of the
Registration Statement or in the corresponding statements made in the
Prospectus, or arising out of or based upon any omission, or alleged
omission, to state a material fact in connection with such information
furnished by you to us or the applicable Fund and required to be stated in
such answers or necessary to make such information not misleading.
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(c) Each party's agreement to indemnify the other (and its respective
officers, directors and controlling persons, as aforesaid) is expressly
conditioned upon the indemnifying party being notified of any action brought
against any person entitled to indemnification hereunder, such notification
to be given by letter or by telex, telegram, fax or similar means of same day
delivery received by the indemnifying party at the address to which notices
are to be sent hereunder within seven (7) days after the summons or other
first legal process shall have been served. The indemnifying party shall
have the right to control the defense of such action, with counsel of its own
choosing (provided such counsel is reasonably satisfactory to the person
seeking indemnification). The failure so to notify the indemnifying party as
specified herein shall not relieve the indemnifying party from any liability
which such party may have to the person claiming indemnification, otherwise
than on account of the indemnifying party's agreement contained in this
Section 10. This Section 10 shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of any person
entitled to indemnification hereunder and shall survive the delivery of any
Shares and termination of this Agreement. The agreements to indemnify
contained herein shall inure exclusively to the benefit of the persons
entitled to indemnification pursuant to this Agreement and their respective
estates, successors and assigns.
11. NOTICES. Notices hereunder shall be deemed to have been duly given
if delivered by hand or facsimile (a) if to you, at your address or facsimile
number set forth below and (b) if to us, to U.S. Growth Investments, Inc.,
0000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxxx, Xxxxxxxxx 00000, or, in each
case, such other address as may be notified to the other party.
12. AMENDMENTS. We may modify this Agreement at any time by written
notice to you. The first order placed by you subsequent to the giving of
such notice shall be deemed acceptance by you of the modification described
in such notice.
13. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Minnesota.
14. ARBITRATION. Any controversy or claim arising out of or relating
to this Agreement, or any breach thereof, shall be settled by arbitration in
accordance with the then existing NASD Code of Arbitration Procedure. Any
arbitration shall be conducted in Minneapolis, Minnesota, 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.
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Please confirm your agreement by signing and returning to us the two
enclosed duplicate copies of this Agreement. Upon our acceptance hereof, the
Agreement shall constitute a valid and binding contract between us. After
our acceptance, we will deliver to you one fully executed copy of this
Agreement.
Confirmed: ___________, 199 U.S. GROWTH INVESTMENTS, INC.
By: _______________________________
___________________________________ Its: ______________________________
(Name of Authorized Dealer)
By: _______________________________
(Authorized Signature)
___________________________________
Printed name of person signing
___________________________________
Title of person signing
___________________________________
Street Address
___________________________________
City State Zip
___________________________________
Fax No.
___________________________________
Telephone No.
___________________________________
Telex No.
___________________________________
Firm Taxpayer Identification No.
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EXHIBIT A
TO THE
SELECTED DEALER AGREEMENT
The following listing constitutes the Funds for which U.S. Growth
Investments, Inc. serves as distributor and principal underwriter and which are
offered for sale to the Authorized Dealer and its customers:
The Xxxxx Growth Fund, Inc. -- Class A Shares*
The Xxxxx Growth Fund, Inc. -- Class B Shares
The Xxxxx Growth Fund, Inc. -- Class C Shares
The Xxxxx Growth Fund, Inc. -- Class D Shares
Xxxxx U.S. Emerging Growth Fund -- Class B Shares
Xxxxx U.S. Emerging Growth Fund -- Class C Shares
Xxxxx U.S. Emerging Growth Fund -- Class D Shares
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* Class A Shares of The Xxxxx Growth Fund, Inc. are available only to certain
investors and are not otherwise generally available for sale to the public.
See the Fund's Prospectus for details.
