EXHIBIT (h)(2)
--------------
MASTER SELLING AND SERVICING AGREEMENT
[ ], 2003
Ladies and Gentlemen:
In connection with offerings of securities of investment
companies ("Investment Companies") registered under the Investment Company Act
of 1940, as amended (the "1940 Act"), for which we are acting as distributor
or co-distributor, you may be offered the right to act as a selling agent for
the offer and sale of a portion of such securities for your investor clients
and as a servicing agent for the provision of services to your investor
clients thereafter. This will confirm the mutual agreements (a) between us and
you as to the general terms and conditions applicable to your participation in
any such selling agent group and (b) between the issuer of securities and you
as to your obligations as a servicing agent.
1. Applicability of this Agreement. (a) The terms and
conditions of this Agreement shall be applicable to any offering of securities
("Securities") of an Investment Company pursuant to a registration statement
filed under the Securities Act of 1933, as amended (the "Securities Act"), in
respect of which Xxxxxxxxxxx & Co. is acting as agent for the offer and sale
of Securities and pursuant to which you have agreed to act as a selling agent
("Selling Agent") and as a shareholder servicing agent ("Servicing Agent,"
collectively with Selling Agent from time to time referred to as "Agent") and
has expressly informed you that such terms and conditions shall be applicable.
(b) Continuous or Delayed Offerings. In the event that any
issuer of Securities whose Offering is covered by paragraph (a) of this
Section 1 elects under Rule 415 of the Securities Act to offer and sell
Securities on a delayed or continuous basis, the terms and conditions of this
Agreement shall be applicable to any such delayed or continuous offering of
Securities.
Any such offering of Securities for which you are acting as
an Agent is hereinafter called an "Offering."
2. Conditions of Offering; Acceptance and Purchases. In
effecting the purchase or sale of Securities, the parties understand and agree
that Agent shall act solely upon instructions by or on behalf of investors,
and that all purchases of securities shall be initiated upon the instruction
and order by or on behalf of the purchaser thereof for such investor's account
and not for the account of Agent. Any Offering will be subject to delivery of
Securities and may be subject to the approval of certain legal matters by
counsel and to the satisfaction of certain other conditions. We will advise
you by telecopy, telex or other form of written communication ("Written
Communication," which term may include a prospectus) of the particular method
and supplementary terms and conditions (including without limitation the
information as to prices and the offering date referred to in Section 3(b)
hereof) of any Offering in which you are invited to participate as agent. To
the extent such supplementary terms and conditions are inconsistent with any
provision herein, such terms and conditions shall supersede any such
provision. Unless otherwise indicated in any such Written Communication,
acceptances and other communications by you with respect to an Offering should
be sent to Xxxxxxxxxxx & Co., 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, telecopy: (212) [ ], Attention: [ ]. We may close the subscription
books at any time in our sole discretion without notice, and we reserve the
right to reject any acceptance in whole or in part.
Unless notified by us or as otherwise provided in any
Written Communication, payment for and delivery of Securities will be made
through the facilities, and subject to the rules and procedures of, the
National Securities Clearing Corporation (NSCC) Fund Settlement, Entry and
Registration Verification System (Fund/SERV System), subject to the issuer's
rights to accept or reject applications as set forth in a Written
Communication.
3. Representations, Warranties and Agreements.
(a) Prospectus Delivery Procedures. We will make available
to you as soon as practicable after sufficient copies are made available to us
by the issuer of the Securities such number of copies of each preliminary
prospectus and of the final prospectus (which terms include any statements of
additional information) relating thereto (and of any statement of additional
information) as you may reasonably request for the purposes contemplated by
the Securities Act and the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and the applicable rules and regulations of the Securities
and Exchange Commission thereunder.
You represent and warrant that you are familiar with Rule
15c2-8 under the Exchange Act relating to the distribution of preliminary and
final prospectuses and agree that you will comply therewith. You agree to make
a record of your distribution of each preliminary prospectus and when
furnished with copies of any revised preliminary prospectus, you will promptly
forward copies thereof to each person to whom you have theretofore distributed
a preliminary prospectus.
You agree that in making offers of Securities you will rely
upon no statement whatsoever, written or oral, other than the statements in
the final prospectus delivered to you by us. You will not be authorized by the
issuer of Securities to give any information or to make any representation not
contained in the prospectus in connection with the sale of such Securities.
(b) Offer and Sale to the Public. The Offering of
Securities is made subject to the conditions referred to in the prospectus
relating to the Offering and to the terms and conditions set forth in this
Agreement, including that Securities may only be offered to your clients that
(i) have a net worth (together, in the case of a natural person, with assets
held jointly with a spouse) of more than the amount set forth in paragraph
(d)(1)(ii)(A) of Rule 205-3 under the Investment Advisers Act of 1940, as
amended (the "Advisers Act"), currently $1,500,000, as such amount may be
amended from time to time (a "qualified investor") and (ii) complete and sign
an investor certification (in the form provided by the issuer of Securities)
as a condition to purchasing Securities.
With respect to any Offering of Securities, we will inform
you by a Written Communication of the public offering price, selling
commissions and concessions payable to dealers in effect from time to time and
the time when you may commence selling Securities to the public. After such
Offering has commenced, we may change the public offering price, selling
commissions and concessions payable to dealers.
(c) NASD. You represent and warrant that you are actually
engaged in the investment banking or securities business and either are a
member in good standing of 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 with the NASD's interpretation with respect to
free-riding and withholding. You further represent, by your participation in
an Offering, that you have provided to us all documents and other information
required to be filed with respect to you, any related person or any person
associated with you or any such related person pursuant to the supplementary
requirements of the NASD's interpretation with respect to review of corporate
financing to the extent that such requirements relate to such Offering.
You agree that, in connection with any purchase or sale of
the Securities wherein a selling concession, discount or other allowance is
received or granted, you will (i) if you are a member of the NASD, comply with
all applicable interpretive material ("IM") and Conduct Rules of the NASD,
including, without limitation, IM 2110-1 (relating to Free-Riding and
Withholding) and Conduct Rule 2740 (relating to Selling Concessions, Discounts
and Other Allowances) or (ii) if you are a foreign bank or dealer or
institution not eligible for such membership, comply with IM 2110-1 and with
Conduct Rules 2730 (relating to Securities Taken in Trade), 2740 (relating to
Selling Concessions) and 2750 (relating to Transactions With Related Persons)
as though you were such a member and Conduct Rule 2420 (relating to Dealing
with Non-Members) as it applies to a non-member broker or dealer in a foreign
country.
If you are a member of the NASD, you further agree that,
prior to making an offering of Securities to any client, you will comply with
Conduct Rule 2310 (Recommendations to Customers (Suitability)), which
compliance shall include without limitation considering (i) the suitability of
this investment with respect to the client's investment objectives and
personal situation, (ii) factors such as the client's personal net worth,
income, age, risk tolerance and liquidity needs, and (iii) whether the
client's risk profile is suitable for this investment.
If you are a broker or dealer registered under the Exchange
Act, you further agree that in accepting funds from clients you will comply
with Rule 15c2-4 under the Exchange Act.
(d) Relationship among Distributor and Agents. We shall
have full authority to take such action as we deem advisable in all matters
pertaining to any Offering under this Agreement. You are not authorized to act
as agent for us, or the issuer of any Securities in offering Securities to the
public or otherwise. We shall be under no obligation to you except for
obligations assumed hereby or in any Written Communication from us in
connection with any Offering. Nothing contained herein or in any Written
Communication from us shall constitute the Agents an association or partners
with us or with one another. If the Agents, among themselves, should be deemed
to constitute a partnership for federal income tax purposes, then you elect to
be excluded from the application of Subchapter K, Chapter 1, Subtitle A of the
Internal Revenue Code of 1986, as amended, and agree not to take any position
inconsistent with that election. You authorize us, in our discretion, to
execute and file on your behalf such evidence of that election as may be
required by the Internal Revenue Service. In connection with any Offering you
shall be liable for your proportionate amount of any tax, claim, demand or
liability that may be asserted against you alone or against one or more Agents
participating in such Offering, or against us, based upon the claim that the
Agents, or any of them constitute an association, an unincorporated business
or other entity, including, in each case, your proportionate amount of any
expense incurred in defending against any such tax, claim, demand or
liability.
(e) Blue Sky Laws. Upon application to us, we shall inform
you as to any advice we have received from counsel concerning the
jurisdictions in which Securities have been qualified for sale or are exempt
under the securities or blue sky laws of such jurisdictions, but we do not
assume any obligation or responsibility as to your right to sell Securities in
any such jurisdiction.
(f) Compliance with Law. You agree that in selling
Securities pursuant to any Offering (which agreement shall also be for the
benefit of the issuer of such Securities), you will comply with all applicable
laws, rules and regulations, including the applicable provisions of the
Securities Act and the Exchange Act, the applicable rules and regulations of
the Securities and Exchange Commission thereunder, the applicable rules and
regulations of the NASD and the applicable rules and regulations of any
securities exchange or other regulatory authority having jurisdiction over the
Offering. Without limiting the foregoing, (i) you agree that, at all times
since you were invited to participate in an Offering of Securities, you have
complied with the provisions of Regulation M applicable to such Offering, in
each case after giving effect to any applicable exemptions and (ii) you
represent that your incurrence of obligations hereunder in connection with any
Offering of Securities will not result in the violation by you of Rule 15c3-1
under the Exchange Act, if such requirements are applicable to you.
(g) Confidentiality. In effecting the transactions
contemplated by this Agreement, the parties understand and agree that client
confidentiality is of paramount importance. We agree that information relating
to your clients will be maintained and administered by a third party
administrator or other agent retained by the issuer of Securities and not by
us. In addition, the parties agree (i) to protect the confidentiality and
security of any information regarding clients of the other party or any other
Agent that any party gains knowledge of and (ii) to forebear from using such
client information for any purpose except as requested by any governmental or
self regulatory agency or as may be required by any statute, regulation, rule
or judicial holding.
4. Investor Services.
(a) Provision of Services. You agree to maintain accounts
and provide certain other services for your clients who have purchased or
otherwise acquired Securities in an Offering subject to this Agreement. In
addition to any services that may be set forth from time to time in any
Written Communication, you agree to provide customary services to your
clients, which shall include: responding to client inquiries concerning the
issuer of any Securities, any repurchase offers conducted by the issuer of
Securities and the transferability of any Securities and assisting in
selecting dividend payment options.
(b) Restrictions on Transfers. You understand that
Securities will be subject to transfer restrictions that
permit transfers only to persons who are qualified investors and agree to
provide a certification, in a form acceptable to us as reasonably requested by
us from time to time, to that effect. You agree that (i) you will not make any
sales or transfers of Securities to any of your clients unless you believe
that such client is a qualified investor; (ii) you have implemented procedures
designed to enable you to form a reasonable belief that any transferee of
Securities who is a client is a qualified investor; (iii) you will cooperate
with the Securities and Exchange Commission in the event of any audit or
examination of the qualified investor status of your clients with respect to
the Securities; and (iv) confirmations of any transfer will include a
statement regarding the transfer restrictions applicable to the Securities.
(c) Repurchase Offers. If the Securities covered by this
Agreement are issued by an issuer that intends to conduct quarterly
repurchase offers pursuant to Rule 23c-3 of the 1940 Act, you agree: (i) to
deliver to each client that owns Securities in a timely manner any
applicable repurchase offer material; (ii) to respond to client inquiries
about procedures for tendering Securities; (iii) to tender Securities on
behalf of clients that wish to participate in the repurchase offer; and (iv)
to remit repurchase proceeds to the appropriate clients. In addition, if the
issuer of Securities is required to pro rate repurchase offers, you will be
responsible for determining correct allocations among your clients of any
repurchase proceeds and any Securities not purchased in the repurchase
offer.
(d) Continuous or Delayed Offerings. In the event of an
Offering covered by Section 1(b) hereof, you agree to effectuate
participation therein by your qualified investor clients for which you are
acting as Servicing Agent in accordance with this Agreement, including
making any prospectus or offering material relating thereto available to
such clients on a timely basis.
(e) Compensation. Compensation for the services performed by
you pursuant to this Section 4 will be set forth in a Written Communication;
provided that, except as set forth in a Written Communication, neither the
issuer of Securities nor the Distributor will have any other obligation to
compensate you for costs incurred in connection with your servicing
activities.
5. Indemnification. (a) You agree to indemnify and hold
harmless the Distributor (for purposes of this Section, "Distributor" shall
mean us, our directors, officers, employees and agents, and any person who
is or may be deemed to be a controlling person of Distributor) from and
against any and all losses, claims, damages, liabilities and expenses,
including the reasonable costs of investigation and attorney's fees and
expenses as such expenses are incurred by the Distributor in any action or
proceeding between the parties hereto or between the Distributor and any
third party, to which the Distributor may become subject under the
Securities Act, the Exchange Act, the 1940 Act, the Advisers Act or
otherwise, insofar as any such loss, claim, damage, liability or expense (or
action with respect thereto) is asserted by any person to whom you offered
Securities or who agrees to purchase Securities through you or otherwise
arises from your activities pursuant to this Agreement, except insofar as
such loss, claim, damage, or liability is caused by any untrue statement or
omission with respect to information relating to the Distributor furnished
in writing to the issuer of Securities by the Distributor expressly for use
in the any prospectus or any sales material relating to an Offering.
(b) Distributor agrees to indemnify and hold harmless Agent
(for the purposes of this Section, "Agent" shall mean you, your directors,
officers, employees and agents, and any person who is or may be deemed to be
a controlling person of Agent) from and against any and all losses, claims,
damages, liabilities or expenses (including the reasonable costs of
investigation and attorney's fees and expenses as such expenses are incurred
by Agent in any action or proceeding between the parties to this Agreement
or between Agent and any third party) to which Agent may become subject
under the Securities Act, the Exchange Act, the 1940 Act, the Advisers Act
or otherwise, insofar as any such loss, claim, damage, liability or expense
(or action with respect thereto) arises out of or is based on any untrue
statement of a material fact contained in any prospectus or any sales
materials relating to an Offering, or arises out of or is based on the
failure to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however,
that the Distributor's obligation to indemnify and hold harmless Agent
applies only with respect to such statements or omissions of material fact
relating to information about the Distributor furnished in writing by the
Distributor expressly for use in any such prospectus or sales materials.
6. Termination; Supplements and Amendments. This Agreement
shall continue in full force and effect until terminated by a written
instrument executed by each of the parties hereto; provided, however, that
the terms and conditions set forth in Section 4 (as supplemented by any
Written Communication relating thereto) shall continue in effect until
terminated by a written instrument setting forth the mutual agreements of
any issuer of Securities and you for the disposition of any Securities held
by you for your clients' accounts. This Agreement may be supplemented or
amended by us by written notice thereof to you, and any such supplement or
amendment to this Agreement shall be effective with respect to any Offering
to which this Agreement applies after the date of such supplement or
amendment. Each reference to "this Agreement" herein shall, as appropriate,
be to this Agreement as so amended and supplemented.
7. Successors and Assigns. This Agreement shall be binding
on, and inure to the benefit of, the parties hereto and other persons
specified in Section 1 hereof, and the respective successors and assigns of
each of them.
8. Governing Law. This Agreement and the terms and
conditions set forth herein with respect to any Offering together with such
supplementary terms and conditions with respect to such Offering as may be
contained in any Written Communication from us to you in connection
therewith shall be governed by, and construed in accordance with, the laws
of the State of New York applicable to contracts made and to be performed
within the State of New York.
[Signature Page Follows]
Please confirm by signing and returning to us the enclosed
copy of this Agreement that your subscription to or your acceptance of any
reservation of any Securities pursuant to an Offering shall constitute (i)
acceptance of and agreement to the terms and conditions of this Agreement (as
supplemented and amended pursuant to Section 5 hereof; together with and
subject to any supplementary terms and conditions contained in any Written
Communication from us in connection with such Offering, all of which shall
constitute a binding agreement between you and us, (ii) confirmation that your
representations and warranties set forth in Section 3 hereof are true and
correct at that time, (iii) confirmation that your agreements set forth in
Sections 2 and 3 hereof have been and will be fully performed by you to the
extent and at the times required thereby and (iv) in the case of any Offering
described in Section 3(a) or 3(b) hereof, acknowledgment that you have
requested and received from us sufficient copies of the final prospectus with
respect to such Offering in order to comply with your undertakings in Section
3(a) or 3(b) hereof.
Very truly yours,
Xxxxxxxxxxx & Co.
By: ______________________
Name:
Title:
..................................................................(Name of Agent)
By:........................................................................
Name:
Title:
Address:
Telephone:
Fax:
