EX-99.23.e.ii
UNDERWRITING AGREEMENT
This Agreement, dated as of the 30th day of March, 2001, made by and
between AmeriPrime Advisors Trust, an Ohio business trust (the "Trust")
operating as an open-end management investment company registered under the
Investment Company Act of 1940, as amended (the "Act"); Polynous Capital
Management, Inc. ("Polynous"), a registered investment advisor existing as
corporation duly organized and existing under the laws of the State of
California; and Polynous Securities, LLC ("Polynous Securities"), a limited
liability company duly organized and existing under the laws of the State of
California (collectively, the "Parties").
WITNESSETH THAT:
WHEREAS, the Trust is authorized by its Agreement and Declaration of
Trust to issue separate series of shares representing interests in
separate investment portfolios (the "Series"), one of which is the
Polynous Growth Fund (the "Fund");
WHEREAS, Polynous has been appointed investment advisor to the Fund;
WHEREAS, Polynous Securities is a broker-dealer registered with the
U.S. Securities and Exchange Commission and a member in good standing
of the National Association of Securities Dealers, Inc. (the "NASD");
and
WHEREAS, the Parties are desirous of entering into an agreement
providing for the distribution by Polynous Securities of the shares of
the Fund (the "Shares").
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and in exchange of good and valuable consideration,
the sufficiency and receipt of which is hereby acknowledged, the
Parties hereto, intending to be legally bound, do hereby agree as
follows:
1. Appointment.
-----------
The Trust hereby appoints Polynous Securities as its exclusive agent
for the public distribution of the Shares in the fifty United States of
America, the District of Columbia and Commonwealth of Puerto Rico, and
Polynous Securities hereby accepts such appointment under the terms of
this Agreement. The Trust agrees that it will not sell any Shares to
any person except to fill orders for the shares received through
Polynous Securities; provided, however, that the foregoing exclusive
right shall not apply: (a) to Shares issued or sold in connection with
the merger or consolidation of any other investment company with the
Fund or the acquisition by purchase or otherwise of all or
substantially all of the assets of any investment company or
substantially all of the outstanding shares of any such company by the
Fund; (b) to Shares which may be offered by the Fund to its
stockholders for reinvestment of cash distributed from capital gains or
net investment income of the Fund; (c) to Shares which may be issued to
shareholders of other funds who exercise any exchange privilege set
forth in the Trust's Prospectus; or (d) to Shares sold pursuant to an
exemption. Notwithstanding any other provision hereof, the Trust may
terminate, suspend, or withdraw the offering of the Shares whenever, in
its sole discretion, it deems such action to be desirable.
2. Sale and Repurchase of Shares.
-----------------------------
Polynous Securities agrees to provide the services contemplated
hereby, and
(a) Polynous Securities is hereby granted the right, as agent for
the Trust, to sell Shares to the public against orders
therefor at the public offering price (as defined in
sub-paragraph 2.(c) below).
(b) Polynous Securities will also have the right to take, as agent
for the Trust, all actions which, in Polynous Securities' good
faith and reasonable judgement, and subject to the Trust's
reasonable approval, are necessary to carry into effect the
distribution of the Shares.
(c) The public offering price for Shares shall be determined in
the manner provided in the then current Prospectus and
Statement of Additional Information relating to the Shares.
(d) The net asset value of the Shares shall be determined in the
manner provided in the then current Prospectus and Statement
of Additional Information relating to the Shares, and when
determined shall be applicable to all transactions as provided
in the Prospectus. The net asset value of the Shares shall be
calculated by the Trust or by another entity on behalf of the
Trust. Polynous Securities shall have no duty to inquire into,
or liability for, the accuracy of the net asset value per
Share as calculated.
(e) On every sale, Polynous Securities shall promptly pay to the Fund the
applicable net asset value of the Shares.
(f) Upon receipt of purchase instructions, Polynous Securities
will transmit such instructions to the Trust or its transfer
agent for registration of the Shares purchased.
(g) Nothing in this Agreement shall prevent Polynous Securities or any
affiliated person (as defined in the Act) of Polynous Securities from
acting as underwriter or distributor for any other person, firm or
corporation (including other investment companies), or in any way limit or
restrict Polynous Securities or such affiliated person from buying, selling
or trading any securities for its or their own account or for the accounts
of others for whom it or they may be acting; provided, however, that
Polynous Securities expressly agrees that it will not for its own account
purchase any Shares of the Fund except for investment purposes, and that it
will not for its own account sell any such Shares except by redemption of
such Shares by the Fund, and that it will not undertake in any activities
which will have a materially adverse effect on the performance of its
obligations to the Trust under this Agreement.
(h) Polynous Securities may repurchase Shares at such prices and
upon such terms and conditions as shall be specified from time
to time in the Prospectus.
3. Rules of Sale of Shares.
-----------------------
Polynous Securities does not agree to sell any specific number of
Shares. Polynous Securities, as Underwriter for the Trust, undertakes
to sell Shares on a best efforts basis and only against orders received
therefor. The services to be performed by Polynous Securities hereunder
shall include those set forth on Schedule A. The Trust reserves the
right to terminate, suspend or withdraw the sale of the Shares for any
reason deemed adequate by it, and the Trust reserves the right to
refuse at any time or times to sell any of the Shares to any person for
any reason deemed adequate by it.
4. Rules of NASD.
-------------
(a) Polynous Securities will conform to the Conduct Rules of the
NASD and the applicable securities laws and regulations of any
jurisdiction in which it directly or indirectly offers or
sells any Shares.
(b) Polynous Securities will require each dealer with whom
Polynous Securities has a selling agreement to conform to the
applicable provisions of the Prospectus, with respect to the
public offering price of the Shares, and Polynous Securities
shall not cause the Trust to withhold the placing of purchase
orders so as to make a profit thereby.
(c) The Trust and Polynous agree to use reasonable efforts to furnish to
Polynous Securities sufficient copies of any and all: agreements, plans,
communications with the public or other materials which the Trust or
Polynous intends to use in connection with any sales of Shares ("Sales
Materials"), in adequate time for Polynous Securities to file and clear
such Sales Materials with the proper authorities before they are put in
use, and Polynous Securities shall be responsible for making all such
required regulatory filings in a timely manner at its own expense. Polynous
Securities and the Trust or Polynous may agree that any such Sales
Materials do not need to be filed subsequent to distribution. In addition,
the Trust and Polynous agree not to use any such Sales Materials until so
filed and cleared for use by appropriate authorities as well as by Polynous
Securities.
(d) Polynous Securities, at its own expense, will qualify as a
dealer or broker, or otherwise, under all applicable state or
federal laws required in order that the Shares may be sold in
such states as may be mutually agreed upon by the Parties.
(e) Polynous Securities shall remain registered as a broker dealer
with the U.S. Securities and Exchange Commission and a member
of the National Association of Securities Dealers for the term
of this Agreement.
(f) Polynous Securities shall not, in connection with any sale or
solicitation of a sale of the Shares, make or authorize any
representative, service organization, broker or dealer to make
any representations concerning the Shares, except those
contained in the Prospectus covering the Shares and in
communications with the public or sales materials approved by
Polynous Securities as information supplemental to such
Prospectus. Copies of the Prospectus will be supplied by the
Trust or Polynous to Polynous Securities in reasonable
quantities upon request.
5. Records to be Supplied by the Trust.
-----------------------------------
The Trust shall furnish to Polynous Securities copies of all
information, financial statements and other papers which Polynous
Securities may reasonably request for use in connection with the
distribution of the Shares including, but not limited to, one certified
copy of all Fund financial statements prepared for the Trust by its
independent public accountants.
6. Expenses.
--------
(a) The Trust will bear the following expenses:
(i) preparation, setting in type, and printing of sufficient copies of the
Prospectuses and Statements of Additional Information for distribution to
shareholders, and the cost of distribution of same to the shareholders;
(ii) preparation, printing, and distribution of reports and other communications
to shareholders; (iii) registration of the Shares under the federal securities
laws; (iv) qualification of the Shares for sale in the jurisdictions as directed
by the Trust; (v) maintaining facilities for the issue and transfer of the
Shares; (vi) supplying information, prices and other data to be furnished by the
Trust under this Agreement; and (vii) any original issue taxes or transfer taxes
applicable to the sale or delivery of the Shares or certificates
therefor.
(b) Polynous, out of its own resources, will pay all expenses incident to the
sale and distribution of the Shares sold hereunder.
7. Terms and Compensation.
----------------------
(a) The terms of this Agreement shall commence upon the date of the first
issuance of Shares.
(b) This Agreement shall remain in effect for twelve (12) months.
This Agreement shall continue thereafter for periods not
exceeding one (1) year, if approved at least annually (i) by the
Board of Trustees of the Trust or a vote of a majority of the
outstanding voting securities of the Fund; and (ii) by a vote of
a majority of the Trustees of the Trust who are not parties to
this Agreement (other than as Trustees of the Trust) or
interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval.
(c) Fees and expenses payable to Polynous Securities shall be paid
by Polynous out of its own resources as set forth in Schedule
"B" attached and shall be fixed for the first twelve (12)
month period of this Agreement. Thereafter, the fee schedule
will be subject to annual review and adjustment.
(d) This Agreement (i) may at any time be terminated without the
payment of any penalty, either by a vote of the Trustees of
the Trust or by a vote of a majority of the outstanding voting
securities of the Fund, on sixty (60) days' written notice to
Polynous Securities; and (ii) may be terminated by Polynous
Securities on sixty (60) days' written notice to the Trust.
(e) This Agreement shall automatically terminate in the event of its
assignment, as defined in the Act.
8. Indemnification of Polynous Securities by Polynous.
--------------------------------------------------
Polynous will indemnify and hold Polynous Securities harmless for the
actions of Polynous' employees registered with the NASD as Polynous
Securities representatives, and hereby undertakes to maintain
compliance with all rules and regulations concerning any and all sales
presentations made by such employees.
9. Liabilities of Polynous Securities.
----------------------------------
(a) Polynous Securities, its directors, officers, members, employees,
shareholders and agents shall not be liable for any error of
judgement or mistake of law or for any loss suffered by the Trust
in connection with the performance of this Agreement, except a
loss resulting from a breach of Polynous Securities' obligations
pursuant to Section 4 of this Agreement (Rules of NASD), a breach
of fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith
or negligence on the part of Polynous Securities in the
performance of its obligations and duties or by reason of its
reckless disregard of its obligations and duties under this
Agreement, (whether with or without basis in fact or law) which
the Trust may incur or be required to pay due to Polynous
Securities' breach of this agreement, including without
limitation, a breach of the standard of care set forth above in
Section 9(a).
(b) The Trust agrees to indemnify and hold harmless Polynous Securities against
any and all liability, loss, damages, costs or expenses (including
reasonable counsel fees) which Polynous Securities may incur or be required
to pay hereafter, in connection with any action, suit or other proceeding,
whether civil or criminal, before any court or administrative or
legislative body, in which Polynous Securities may be involved as a party
or otherwise or with which Polynous Securities may be threatened, by reason
of the offer or sale of the Shares by persons other than Polynous
Securities or its representatives, prior to the execution of this
Agreement. If a claim is made against Polynous Securities as to which
Polynous Securities may seek indemnity under this Section, Polynous
Securities shall notify the Trust promptly of any written assertion of such
claim threatening to institute an action or proceeding with respect thereto
and shall notify the Trust promptly of any action commenced against
Polynous Securities within 10 days time after Polynous Securities shall
have been served with a summons or other legal process, giving information
as to the nature and basis of the claim. Failure so to notify the Trust
shall not, however, relieve the Trust from any liability which it may have
on account of the indemnity under this Section 9(b) if the Trust has not
been prejudiced in any material respect by such failure. The Trust shall
have the sole right to control the settlement of any such action, suit or
proceeding subject to Polynous Securities' approval, which shall not be
unreasonably withheld. Polynous Securities shall have the right to
participate in the defense of any action or proceeding and to retain its
own counsel, and the reasonable fees and expenses of such counsel shall be
borne by the Trust (which shall pay such fees, costs and expenses at least
quarterly) if:
(i) Polynous Securities has received a written
opinion of counsel, on which the Trust is expressly
permitted to rely, stating that the use of counsel
chosen by the Trust to represent Polynous Securities
would present such counsel with a conflict of
interest; (ii) the defendants in, or targets of, any
such action or proceeding include both Polynous
Securities and the Trust, and legal counsel to
Polynous Securities shall have reasonably concluded
in a written legal opinion, on which the Trust is
expressly permitted to rely, that there are legal
defenses available to it which are different from or
additional to those available to the Trust or which
may be adverse to or inconsistent with defenses
available to the Trust (in which case the Trust shall
not have the right to direct the defense of such
action on behalf of Polynous Securities); or (iii)
the Trust shall authorize Polynous Securities to
employ separate counsel at the expense of the Trust.
Notwithstanding anything to the contrary herein, it
is understood that the Trust shall not, in connection
with any action, suit or proceeding, be liable under
this Agreement for the fees and expenses of more than
one legal counsel.
(c) Any person, even though also a director, officer, member,
employee, shareholder or agent of Polynous Securities, who may
be or become an officer, director, trustee, employee or agent
of the Trust, shall be deemed, when rendering services to the
Trust or acting on any business of the Trust (other than
services or business in connection with Polynous Securities'
duties hereunder), to be rendering such services to or acting
solely for the Trust and not as a director, officer, member,
employee, shareholder or agent, or one under the control or
direction of Polynous Securities even though receiving salary
from Polynous Securities.
(d) The Trust agrees to indemnify, defend, and hold harmless Polynous
Securities, and each person who controls Polynous Securities within the
meaning of Section 15 of the Securities Act of 1933, as amended (the
"Securities Act"), or Section 20 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), against any and all actual and alleged
losses, claims, damages and liabilities, joint or several (including any
reasonable investigative, legal and other expenses incurred in connection
therewith) to which they, or any of them, may become subject under the Act,
the Securities Act, the Exchange Act or other federal or state law or
regulation, at common law or otherwise insofar as such losses, claims,
damages or liabilities (or actions, suits or proceedings in respect
thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in a Prospectus, Statement of
Additional Information, supplement thereto, sales literature or other
written information prepared by the Trust and furnished by the Trust to
Polynous Securities for Polynous Securities' use hereunder, disseminated by
the Trust or which arise out of or are based upon any omission or alleged
omission to state therein or necessary to make the statements therein not
misleading. Such indemnity shall not, however, inure to the benefit of
Polynous Securities (or any person controlling Polynous Securities) on
account of any losses, claims, damages or liabilities (or actions, suits or
proceedings in respect thereof) arising from the sale of the Shares to any
person by Polynous Securities (i) if such untrue statement or omission or
alleged untrue statement or omission was made in the Prospectus, Statement
of Additional Information, or supplement, sales or other literature, in
reliance upon and in conformity with information furnished in writing to
the Trust by Polynous Securities or any affiliate of Polynous Securities
specifically for use therein or (ii) if such losses, claims, damages or
liabilities arise out of or are based upon an untrue statement or omission
or alleged untrue statement or omission found in any Prospectus, Statement
of Additional Information, supplement, sales or other literature,
subsequently corrected, but negligently distributed by Polynous Securities
and a copy of the corrected Prospectus was not delivered to such person at
or before the confirmation of the sale to such person.
(e) Polynous Securities agrees to indemnify, defend, and hold harmless the
Trust, and each person who controls the Trust within the meaning of Section
15 of the Securities Act, or Section 20 of the Exchange Act, against any
and all actual or alleged losses, claims, damages and liabilities, joint or
several (including any reasonable investigative, legal and other expenses
incurred in connection therewith) to which they, or any of them, may be
subject under the Act, the Securities Act, the Exchange Act or other
federal or state law or regulation, at common law or otherwise insofar as
such losses, claims, damages or liabilities (or actions, suits or
proceedings in respect thereof) arise out of or are based upon (i) any
matter described in Subsection 9(d)(i) or (ii) above; (ii) any material
breach by Polynous Securities of any provision of this Agreement; (iii)
Polynous Securities' negligence, bad faith or willful misconduct, or (iv)
any untrue oral statement or alleged untrue oral statement of a material
fact made by Polynous Securities or its agents, or any omission or alleged
omission orally to state a material fact by Polynous Securities or its
agents, to or with respect to any actual or potential investor in the Fund,
or any such untrue statement or omission contained in or made with respect
to any written supplemental sales or other materials respecting the Fund
prepared by Polynous Securities.
10. Amendments.
----------
No provision of this Agreement may be amended or modified in any manner
whatsoever, except by a written agreement properly authorized and
executed by the Parties.
11. Section Headings.
----------------
Section and paragraph headings are for convenience only and shall not
be construed as part of this Agreement.
12. Reports.
-------
Polynous Securities shall prepare reports for the Board of Trustees of
the Trust , on a quarterly basis, showing such information as, from
time to time, shall be reasonably requested by such Board.
13. Severability.
------------
If any part, term or provision of this Agreement is held by any court
to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not
affected, and the rights and obligations of the Parties shall be
construed and enforced as if the Agreement did not contain the
particular part, term or provision held to be illegal or invalid
provided that the basic agreement is not thereby substantially
impaired.
14. Governing Law and Questions of Interpretation.
---------------------------------------------
(a) This Agreement shall be governed by and construed and interpreted
in accordance with the laws of the State of Ohio. (b)Any question of
interpretation of any term or provision of this Agreement having a
counterpart in or otherwise derived from a term or provision of the Act
shall be resolved by reference to such term or provision of the Act and
to interpretation thereof, if any, by the United States courts or in
the absence of any controlling decision of any such court, by rules,
regulations or orders of the Securities and Exchange Commission issued
pursuant to said Act. In addition, where the effect of a requirement of
the Act, reflected in any provision of this Agreement is revised by
rule, regulation or order of the Securities and Exchange Commission,
such provision shall be deemed to incorporate the effect of such rule,
regulation or order.
15. Limitation of Trust's Liability. The term "AmeriPrime Advisors Trust" means
and refers to the Trustees from time to time serving under the Trust's
Declaration of Trust as the same may subsequently thereto have been, or
subsequently hereto be, amended. It is expressly agreed that the
obligations of the Trust hereunder shall not be binding upon any of the
Trustees, Shareholders, nominees, officers, agents or employees of the
Trust, personally, but bind only the property of the Fund, as provided in
the Declaration of Trust of the Trust. The execution and delivery of this
Agreement have been authorized by the Trustees and Shareholders of the Fund
and signed by the officers of the Trust, acting as such, and neither such
authorization by such Trustees and Shareholders nor such execution and
delivery by such officers shall be deemed to have been made by any of them
individually or to impose any liability on any of them personally, but
shall bind only the property of the Fund as provided in the Declaration of
Trust of the Trust. A copy of the Agreement and Declaration of Trust of the
Trust is on file with the Secretary of State of Ohio.
16. Authority to Execute.
--------------------
The Parties represent and warrant each other that the execution and
delivery of this Agreement by the undersigned officer of each party has
been duly and validly authorized; and, when duly executed, this
Agreement will constitute a valid and legally binding and enforceable
obligation of each Party.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement consisting of
seven type written pages, together with Schedule "A" and Schedule "B", to be
signed by their duly authorized officers, as of the day and year first above
written.
Polynous Capital Management, Inc. Polynous Securities, LLC
/s/ /s/
-------------------------------------------- -------------------------------------------
By: Xxxxx X. Xxxxx, President By: Xxxxx X. Xxxxx, Manager
AmeriPrime Advisors Trust
/s/
-----------------------------------------------------
By: Xxxxxxx X. Xxxxxxxxxxxx, President
14649
Schedule "A"
Underwriter/Sponsor Services
for
Polynous Growth Fund
I. Underwriter/Sponsor services include:
------------------------------------
A) Preparation and execution of Underwriting, Agent, and 12b-1 Plans
Monitoring accruals Monitoring expenses Disbursements for expenses and
trail commissions
B) Quarterly 12b-1 and/or Service Fee Reports to Board of Trustees
C) Sales Materials review, recommendations and submissions to the NASD
D) Initial NASD Licensing and Transfers of Registered Representatives
U-4 Form and Fingerprint Submissions to NASD Supplying Series 6 and 63
written study material Registration for Exam Preparation classes
Renewals and Terminations of Representatives
E) Written supervisory procedures and manuals for Registered Representatives
F) Ongoing compliance updates for Representatives regarding sales
practices, written correspondence and other communication with
the public.
G) NASD Continuing Education Requirement
Schedule "B"
Underwriter and Distribution Fee Schedule
for
Polynous Growth Fund
I. A) Underwriter/Sponsor Services.
----------------------------
The annual fee to Polynous Securities of $25,000 per year for
the initial portfolio or class of shares and $2,500 per year
for each additional portfolio or class of shares for services
is rendered for being primary Underwriter/Sponsor of the
Polynous Growth Fund, including primary licensing/regulatory
agent for Polynous Securities personnel.
The fee for representing the Polynous Growth Fund as primary
Underwriter/Sponsor includes the expenses and personnel
required to maintain the various regulatory books and records
of the Broker/Dealer and maintenance of shareholder files and
records for all transactions processed on behalf of the
Polynous Growth Fund. These fees also include the regulatory
requirements of all marketing related and distribution reports
including maintenance of records regarding individual
transaction activities of the Polynous Securities' registered
representatives.
B) Representative Registration and Renewals.
----------------------------------------
Polynous Securities will maintain annual NASD and state
license renewals and the monitoring required of representative
activities as follows:
Up to 10 States - $2,000 per Representative per Year
All 50 States - $4,000 per Representative per Year
C) Miscellaneous/Out-of-Pocket Expenses.
------------------------------------
These expenses may include, but are not limited to:
o processing fees relating to NASD literature review submissions
o out-of-pocket expenses related to submitting literature for review and
communications costs connected with communicating with the NASD
o Mailing and communications expense related to
communicating with other regulatory bodies on behalf of
the trust exclusive of communication related to
representative registration and renewals.
