EXHIBIT 99.6B
FINANCIAL INSTITUTION
SALES AND SERVICE AGREEMENT
[LOGO]
XXXX XXXXXXX FUNDS, INC.
Xxxxxx - Xxxxxxxxxxxxx - 00000-0000
XXXX XXXXXXX FUNDS, INC.
000 XXXXXXXXXX XXXXXX
XXXXXX, XX 00000-0000
FINANCIAL INSTITUTION
SALES AND SERVICE AGREEMENT
Date---------------------------------
Xxxx Xxxxxxx Funds, Inc. ("The Distributor", or "Distributor"), ("We" or
"us"), is the principal distributor of the shares of beneficial interest (the
"securities") of each of the Xxxx Xxxxxxx Funds (the "Funds"). Such Funds are
those listed on Schedule A hereto which may be amended or supplemented from time
to time by the Distributor to include additional Funds for which the Distributor
is the principal distributor. You hereby represent that you are a "bank" as
defined in Section 3(a)(b) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and at the time of each transaction in shares of the
Funds, are not required to register as a broker/dealer under the Exchange Act or
regulations thereunder. We invite you to become a non-exclusive soliciting
financial institution ("Financial Institution") to distribute the securities of
the Funds and you agree to solicit orders for the purchase of the securities on
the following terms. Securities are offered pursuant to each Fund's prospectus
and statement of additional information, as such prospectus and statement of
additional information may be amended from time to time. To the extent that the
prospectus or statement of additional information contains provisions that are
inconsistent with the terms of this Agreement, the terms of the prospectus or
statement of additional information shall be controlling.
OFFERINGS
1. You represent and warrant that you will use your best efforts to ensure that
any purchase of shares of the Funds by your customers constitutes a suitable
investment for such customers. You acknowledge that you will base such a
decision of suitability on all the facts you have gathered about your customer's
financial situation, investment objectives, risk tolerance and sophistication.
2. You represent and warrant that a copy of the then-current prospectus of a
Fund will be delivered to your customer before any purchase of shares of that
Fund are effected for that customer. You shall not effect any transaction in, or
induce any purchase or sale of, any shares of the Funds by means of any
manipulative, deceptive or other fraudulent device or contrivance, and shall
otherwise deal equitably and fairly with your customers with respect to
transactions in shares of a Fund.
3. You represent and warrant that you will not make shares of any Fund available
to your customers, including your fiduciary customers, except in compliance with
all Federal and state laws and rules and regulations of regulatory agencies or
authorities applicable to you, or any of your affiliates engaging in such
activity, which may affect your business practices. You confirm that you are not
in violation of any banking law or regulations as to which you are subject. You
agree that you will comply with the requirements of Banking Circular 274 issued
by the Office of the Comptroller of the Currency in offering shares of the Funds
to your customers. We agree that we will comply with all Federal and state laws
and rules and regulations of regulatory agencies or authorities applicable to
us. We and you acknowledge and agree that the offering of shares of the Funds
pursuant to this agreement is subject to the oversight of your management and
the regulatory authorities by which you are subject to review, and that
appropriate records and materials relating to any activity by you or us
undertaken pursuant to this agreement may be accessed by bank examiners in the
due course of any regulatory review to which you may be subject.
4. As principal distributor of the Funds, we shall have full authority to take
such action as we deem advisable in respect of all matters pertaining to the
distribution. This offer of shares of the Funds to you is made only in such
jurisdictions in which we may lawfully sell such shares of the Funds.
5. You shall not make any representation concerning the Funds or their
securities except those contained in the then-current prospectus or statement of
additional information for each Fund.
6. We will supply to you at our expense additional copies of the then-current
prospectus and statement of additional information for each of the Funds and any
printed information supplemental to such material in reasonable quantities upon
request. It shall be your obligation to ensure that all such information and
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materials are distributed to your customers who own or seek to own shares of the
Funds in accordance with securities and/or banking law and regulations and any
other applicable regulations.
7. With the exception of listings of product offerings, you agree not to furnish
or cause to be furnished to any person or display, or publish any information or
materials relating to any Fund (including, without limitation, promotional
materials, sales literature, advertisements, press releases, announcements,
posters, signs and other similar materials), except such information and
materials as may be furnished to you by us the Distributor or the Fund. All
other materials must receive written approval by the Distributor before
distribution or display to the public. Use of all approved advertising and sales
literature materials is restricted to appropriate distribution channels.
8. You are not authorized to act as our agent. In making available shares of the
Funds under this Financial Institution Sales and Service Agreement, nothing
herein shall be construed to constitute you or any of your agents, employees or
representatives as our agent or employee, or as an agent or employee of the
Funds, and you shall not make any representations to the contrary. Nothing shall
constitute you as a syndicate, association, unincorporated business, or other
separate entity or partners with us, but you shall be liable for your
proportionate share of any tax, liability or expense based on any claim arising
from the sale of shares of the Funds under this Agreement. We shall not be under
any liability to you, except for obligations expressly assumed by us in this
Agreement and liabilities under Section 11(f) of the Securities Act of 1933, and
no obligations on our part shall be implied or inferred herefrom.
9. DEALER COMPLIANCE/SUITABILITY STANDARDS (CLASS A AND CLASS B SHARES) -
Certain mutual funds distributed by the Distributor are being offered with two
or more classes of shares of the same investment portfolio ("Fund") - refer to
each Fund prospectus for availability and details. It is essential that the
following minimum compliance/suitability standards be adhered to in offering and
selling shares of these Funds to investors. All soliciting financial
institutions offering shares of the Funds and their agents, employees and
representatives agree to comply with these general suitability and compliance
standards.
SUITABILITY
With two classes of shares of certain funds available to individual
investors, (Class A and Class B), it is important that each investor purchases
not only the fund that best suits his or her investment objective but also the
class of shares that offers the most beneficial distribution financing method
for the investor based upon his or her particular situation and preferences.
Fund share recommendations and orders must be carefully reviewed by you and your
agents, employees and representatives in light of all the facts and
circumstances, to ascertain that the class of shares to be purchased by each
investor is appropriate and suitable. These recommendations should be based on
several factors, including but not limited to:
(A) the amount of money to be invested initially and over
a period of time;
(B) the current level of front-end sales load or back-end
sales load imposed by the Fund;
(C) the period of time over which the customer expects to
retain the investment;
(D) the anticipated level of yield from fixed income funds' Class A and
Class B shares;
(E) any other relevant circumstances such as the availability of reduced
sales charges under letters of intent and/or rights of accumulation.
There are instances when one distribution financing method may be more
appropriate than another. For example, shares subject to a front-end sales
charge may be more appropriate than shares subject to a contingent deferred
sales charge for large investors who qualify for a significant quantity discount
on the front-end sales charge. In addition, shares subject to a contingent
deferred sales charge may be more appropriate for investors whose orders would
not qualify for quantity discounts and who, therefore, may prefer to defer sales
charges and also for investors who determine it to be advantageous to have all
of their funds invested without deduction of a front-end sales commission.
However, if it is anticipated that an investor may redeem his or her shares
within a short period of time, the investor may, depending on the amount of his
or her purchase, bear higher distribution expenses by purchasing contingent
deferred sales charge shares than if he or she had purchased shares subject to a
front-end sales charge.
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COMPLIANCE
Your supervisory procedures should be adequate to assure that an
appropriate person reviews and approves transactions entered into pursuant to
this Financial Institution Sales and Service Agreement for compliance with the
foregoing standards. In certain instances, it may be appropriate to discuss the
purchase with the agents, employees and representatives involved or to review
the advantages and disadvantages of selecting one class of shares over another
with the client. The Distributor will not accept orders for Class B Shares in
any Fund from you for accounts maintained in your name or in the name of your
nominee for the benefit of certain of your customers. Trades for Class B Shares
will only be accepted in the name of the shareholder.
10. CLASS C SHARES - Certain mutual funds distributed by the Distributor may be
offered with Class C shares. Refer to each Fund prospectus for availability and
details. Class C shares are designed for institutional investors and qualified
benefit plans, including pension funds, and are sold without a sales charge or
12b-1 fee. If a commission is paid to you for transactions in Class C shares, it
will be paid by the Distributor out of its own resources.
SALES
11. With respect to any and all transactions in the shares of any Fund pursuant
to this Financial Institution Sales and Service Agreement it is understood and
agreed in each case that: (a) you shall be acting solely as agent for the
account of your customer; (b) each transaction shall be initiated solely upon
the order of your customer; (c) we shall execute transactions only upon
receiving instructions from you acting as agent for your customer or upon
receiving instructions directly from your customer; (d) as between you and your
customer, your customer will have full beneficial ownership of all shares; (c)
each transaction shall be for the account of your customer and not for your
account; and (f) unless otherwise agreed in writing we will serve as a clearing
broker for you on a fully disclosed basis, and you shall serve as the
introducing agent for your customers' accounts. Subject to the foregoing,
however, and except for Class B shares, as described in Section 8 above, you may
maintain record ownership of such customers' shares in an account registered in
your name or the name of your nominee, for the benefit of such customers. Each
transaction shall be without recourse to you provided that you act in accordance
with the terms of this Financial Institution Sales and Service Agreement. You
represent and warrant to us that you will have full right, power and authority
to effect transactions (including, without limitation, any purchases and
redemptions) in shares of the Funds on behalf of all customer accounts provided
by you.
12. Orders for securities received by you from your customers will be for the
sale of the securities at the public offering price, which will be the net asset
value per share as determined in the manner provided in the relevant Fund's
prospectus, as now in effect or as amended from time to time, next after receipt
by us (or the relevant Fund's transfer agent) of the purchase application and
payment for the securities, plus the relevant sales charges set forth in the
relevant Fund's then-current prospectus (the "Public Offering Price"). The
procedures relating to the handling of orders shall be subject to our
instructions which we will forward from time to time to you. All orders are
subject to acceptance by us, and we reserve the right in our sole discretion to
reject any order.
In addition to the foregoing, you acknowledge and agree to the initial and
subsequent investment minimums, which may vary from year to year, as described
in the then-current prospectus for each Fund.
13. You agree to sell the securities only (a) to your customers at the public
offering price then in effect, or (b) back to the Funds at the currently quoted
net asset value.
14. The amount of sales charge to be reallowed to you (the "Reallowance") as a
percentage of the offering price is set forth in the then-current prospectus of
each Fund.
If a sales charge on the purchase is reduced in accordance with the
provisions of the relevant Fund's then- current prospectus pertaining to
"Methods of Obtaining Reduced Sales Charges," the Reallowance shall be reduced
pro rata.
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15. We shall pay a Reallowance subject to the provisions of this agreement as
set forth in Schedule B hereto on all purchases made by your customers pursuant
to orders accepted by us (a) where an order for the purchase of securities is
obtained by you and remitted to us promptly by you, (b) where a subsequent
investment is made to an account established by you or (c) where a subsequent
investment is made to an account established by a financial institution or
registered broker/dealer other than you and is accompanied by a signed request
from the account shareholder that you receive the Reallowance for that
investment and/or for subsequent investments made in such account. If for any
reason, a purchase transaction is reversed, you shall not be entitled to receive
or retain any part of the Reallowance on such purchase and shall pay to us on
demand in full the amount of the Reallowance received by you in connection with
any such purchase. We may withhold and retain from the amount of the Reallowance
due you a sum sufficient to discharge any amount due and payable by you to us.
16. Certain of the Funds have adopted a plan under Investment Company Act Rule
12b-1 ("Distribution Plan" as described in the prospectus). To the extent you
provide distribution and marketing services in the promotion of the sale of
shares of these Funds, including furnishing services and assistance to your
customers who invest in and own shares of such Funds and including, but not
limited to, answering routine inquiries regarding such Funds and assisting in
changing distribution options, account designations and addresses, you may be
entitled to receive compensation from us as set forth in Schedule C hereto. All
compensation, including 12b-1 fees, shall be payable to you only to the extent
that funds are received and in the possession of the Distributor.
17. We will advise you as to the jurisdictions in which we believe the shares
have been qualified for sale under the respective securities or "blue sky" laws
of such jurisdictions, but we assume no responsibility or obligations as to your
right to sell the shares of the Funds in any state or jurisdiction.
18. Orders may be placed through:
Xxxx Xxxxxxx Funds, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000-0000
0-000-000-0000
SETTLEMENT
19. Settlements for wire orders shall be made within five business days after
our acceptance of your order to purchase shares of the Funds. Certificates, when
requested, will be delivered to you upon payment in full of the sum due for the
sale of the shares of the Funds. If payment is not so received or made, we
reserve the right forthwith to cancel the sale, or, at our option, to liquidate
the shares of the Fund subject to such sale at the then prevailing net asset
value, in which latter case you will agree to be responsible for any loss
resulting to the Funds or to us from your failure to make payments as aforesaid.
INDEMNIFICATION
20. The parties to this agreement hereby agree to indemnify and hold harmless
each other, their officers and directors, and any person who is or may be deemed
to be a controlling person of each other, from and against any losses, claims,
damages, liabilities or expenses (including reasonable fees of counsel), whether
joint or several, to which any such person or entity may become subject insofar
as such losses, claims, damages, liabilities or expenses (or actions in respect
thereof) arise out of or are based upon, (a) any untrue statement or alleged
untrue statement of material fact, or any omission or alleged omission to state
a material fact made or omitted by it herein, or, (b) any willful misfeasance or
gross misconduct by it in the performance of its duties and obligations
hereunder.
MISCELLANEOUS
21. Any notice to you shall be duly given if mailed or telegraphed to you at
your address as most recently furnished to us by you.
22. Miscellaneous provisions, if any, are attached hereto and incorporated
herein by reference.
23. This agreement, which shall be construed in accordance with the laws of the
Commonwealth of Massachusetts, may be terminated by any party hereto at any time
upon written notice.
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FINANCIAL INSTITUTION
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Financial Institution
By:
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Authorized Signature of Financial Institution
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Please Print or Type Name
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Title
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Print or Type Address
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Telephone Number
Date:
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In order to service you efficiently, please provide the following
information on your Mutual Funds Operations Department:
OPERATIONS MANAGER:
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ORDER ROOM MANAGER:
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OPERATIONS ADDRESS:
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TELEPHONE: FAX:
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TO BE COMPLETED BY: XXXX XXXXXXX INVESTOR
XXXX XXXXXXX FUNDS, INC. SERVICES CORPORATION
By: By:
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Title Title
TO BE COMPLETED BY:
FINANCIAL INSTITUTION NUMBER:
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XXXX XXXXXXX FUNDS, INC.
SCHEDULE A
DATED JANUARY 1, 1995 TO THE
FINANCIAL INSTITUTION SALES AND SERVICE
AGREEMENT RELATING TO SHARES OF
XXXX XXXXXXX FUNDS
Xxxx Xxxxxxx Sovereign Achievers Fund Xxxx Xxxxxxx National Aviation & Technology Fund
Xxxx Xxxxxxx Sovereign Investors Fund Xxxx Xxxxxxx Regional Bank Fund
Xxxx Xxxxxxx Sovereign Balanced Fund Xxxx Xxxxxxx Gold and Government Fund
Xxxx Xxxxxxx Sovereign Bond Fund Xxxx Xxxxxxx Global Rx Fund
Xxxx Xxxxxxx Sovereign U.S. Government Income Fund Xxxx Xxxxxxx Global Technology Fund
Xxxx Xxxxxxx Special Equities Fund* Xxxx Xxxxxxx Global Fund
Xxxx Xxxxxxx Special Opportunities Fund Xxxx Xxxxxxx Pacific Basin Equities Fund
Xxxx Xxxxxxx Discovery Fund Xxxx Xxxxxxx Global Income Fund
Xxxx Xxxxxxx Growth Fund Xxxx Xxxxxxx International Fund
Xxxx Xxxxxxx Strategic Income Fund Xxxx Xxxxxxx Global Rescources Fund
Xxxx Xxxxxxx Limited Term Government Fund Xxxx Xxxxxxx Emerging Growth Fund
Xxxx Xxxxxxx Xxxx Management Fund Xxxx Xxxxxxx Capital Growth Fund
Xxxx Xxxxxxx Managed Tax-Exempt Fund Xxxx Xxxxxxx Growth & Income Fund
Xxxx Xxxxxxx Tax-Exempt Income Fund Xxxx Xxxxxxx High Yield Bond Fund
Xxxx Xxxxxxx Tax-Exempt Series Fund Xxxx Xxxxxxx Investment Quality Bond Fund
Xxxx Xxxxxxx Special Value Fund Xxxx Xxxxxxx Government SecurritiesFund
Xxxx Xxxxxxx Strategic Short-Term Income Fund Xxxx Xxxxxxx U.S. Government Fund
Xxxx Xxxxxxx CA Tax-Free Fund Xxxx Xxxxxxx Governtment Income Fund
Xxxx Xxxxxxx High Yield Tax-Free Fund Xxxx Xxxxxxx Intermediate Government Fund
Xxxx Xxxxxxx Tax-Free Bond Fund Xxxx Xxxxxxx Adjustable U.S. Government Fund
Xxxx Xxxxxxx U.S. Government Cash Reserve Fund Xxxx Xxxxxxx Xxxx Reserve Money Market B Fund
From time to time Xxxx Xxxxxxx Funds, as principal distributor of the Xxxx
Xxxxxxx Funds, will offer additional funds for sale. These funds will
automatically become part of this Agreement and will be subject to all its
provisions unless otherwise directed by Xxxx Xxxxxxx Funds, Inc.
* Closed to new invstors as of 9/30/94.
XXXX XXXXXXX FUNDS, INC.
SCHEDULE B
DATED JANUARY 1, 1995 TO THE
FINANCIAL INSTITUTION SALES AND SERVICE
AGREEMENT RELATING TO SHARES OF
XXXX XXXXXXX FUNDS
I. REALLOWANCE
The Reallowance paid to Financial Institutions for sales of Xxxx Xxxxxxx
Funds is the same as that paid to Selling Brokers described and set forth in
each Fund's then-current prospectus. No Commission will be paid on sales of
Xxxx Xxxxxxx Xxxx Management Fund or any Xxxx Xxxxxxx Fund that is without a
sales charge. Purchases of Class A shares of $1 million or more, or
purchases into an account or accounts whose aggregate value of fund shares
is $1 million or more will be made at net asset value with no initial sales
charge. On purchases of this type, the Distributor will pay a commission as
set forth in each Fund's then-current prospectus. Xxxx Xxxxxxx Funds, Inc.
will pay Financial Institutions for sales of Class B shares of the Funds a
marketing fee as set forth in each Fund's then-current prospectus for
Selling Brokers.
XXXX XXXXXXX FUNDS, INC.
SCHEDULE C
DISTRIBUTION PLAN SCHEDULE OF COMPENSATION
DATED JANUARY 1, 1995 TO THE
FINANCIAL INSTITUTION SALES AND SERVICE
AGREEMENT RELATING TO SHARES OF
XXXX XXXXXXX FUNDS
FIRST YEAR SERVICE FEE
Pursuant to the Distribution Plan applicable to each of the Funds listed in
Schedule A, the Distributor will advance to you a First Year Service Fee related
to the purchase of Class A shares (only if subject to sales charge) or Class B
shares of any of the Funds, as the case maybe, sold by your firm on or after
July 1, 1993. This Service Fee will be compensation for your personal service
and/or the maintenance of shareholder accounts ("Customer Servicing") during the
twelve-month period immediately following the purchase of such shares, in an
amount not to exceed .25 of 1% of the average daily net assets attributable to
Class A shares or Class B shares of the Fund, as the case may be, purchased by
your customers.
SERVICE FEE SUBSEQUENT TO THE FIRST YEAR
Pursuant to the Distribution Plan applicable to each of the Funds listed in
Schedule A, the Distributor will pay you quarterly, in arrears, a Service Fee
commencing at the end of the twelve-month period immediately following the
purchase of Class A shares (only if subject to sales charge) or Class B shares,
as the case may be, sold by your firm, for Customer Servicing, in an amount not
to exceed .25 of 1% of the average daily net assets attributable to the Class A
shares or Class B shares of the Fund, as the case may be, purchased by your
customers, provided your Financial Institution has under management with the
Funds combined average daily net assets for the preceding quarter of no less
than $1 million, or an individual representative of your Financial Institution
has under management with the Funds combined average daily net assets for the
preceding quarter of no less than $250,000 (an "Eligible Financial
Institution").
