SELECTED DEALER AGREEMENT
Ladies and Gentlemen: January 1, 1997
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 which are not networked, 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 monthly basis within ten business
days following the end of the month 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 10 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 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 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: , 1997 U.S. GROWTH INVESTMENTS, INC.
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By:
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Xxxxxx X. Press, President
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(Name of Authorized Dealer)
By:
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(Authorized Signature
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Printed name of person signing
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Title of person signing
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Xxxxxx Xxxxxxx
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Xxxx Xxxxx Zip
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Fax No.
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Telephone No.
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Telex No.
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Firm Taxpayer Identification No.
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EXHIBIT A
TO THE
SELECTED DEALER AGREEMENT
(REVISED JANUARY 1, 1997)
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
Xxxxx Opportunity Fund -- Class B Shares
Xxxxx Opportunity Fund -- Class C Shares
Xxxxx Opportunity 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.
