AMENDMENT TO DISTRIBUTION AGREEMENT
December 1, 2005
Citigroup Global Markets Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Dear Sirs:
Reference is made to that certain distribution agreement
(the "Agreement"), dated as of June 5, 2000, between Xxxxx Xxxxxx
Institutional Cash Management Fund Inc. (the "Investment Company"),
with respect to one or more separate series listed on Exhibit A
(each a "Fund") and Citigroup Global Markets Inc. This letter
agreement (the "Amendment") amends or supplements certain terms of
the Agreement as set forth below. Except as expressly amended
hereby, the provisions of the Agreement are and shall remain in
full force and effect. Capitalized terms not defined in this
Amendment shall have the meanings given to them in the Agreement.
We acknowledge that Xxxx Xxxxx Inc. ("Xxxx Xxxxx") and
Citigroup Inc. ("Citigroup") have entered into that certain Amended
and Restated Global Distribution Agreement (the "Global Distribution
Agreement"), dated as of October 3, 2005, which provides, for a
period of three years from December 1, 2005, for the distribution
by Citigroup distributors of Citigroup investment products and Xxxx
Xxxxx investment products within the United States and
internationally and for Citigroup's access to certain Xxxx Xxxxx
investment products pursuant to the terms of the Global Distribution
Agreement.
1. Services as a Non-Exclusive Principal Underwriter and
Distributor
Notwithstanding anything to the contrary contained in the
Agreement:
1.1 You shall be, for the period of the Agreement as amended
by this Amendment, a non-exclusive principal underwriter and
distributor of the Fund.
1.2 You may perform any services for any entity, including
investment companies that are not advised or administered by Citigroup
or its subsidiaries.
1.3 You shall retain all rights to the information of your
customers, including, but not limited to, the names, addresses,
telephone numbers and social security numbers of applicants for,
purchasers of, and other customers of the Fund as well as other
identity and private information in respect of your customers,
employees, registered representatives and agents ("Confidential
Information"); provided, however, that Confidential Information shall
not include any customer information that: (x) was previously known
by us from a source other than you without obligations of confidence;
(y) was or is rightfully received by us from a third party without
obligations of confidence to you or from publicly available sources
without obligations of confidence to you; or (z) was or is developed
by means independent of information obtained from you.
2. Termination
In addition to the termination rights already contained in
the Agreement, (i) at any time prior to the second anniversary
hereof, at your option you may terminate the Agreement at any time
in order for you to enter into a mutually satisfactory mutual fund
dealer agreement with the principal underwriter that is an affiliate
of Xxxx Xxxxx for the Investment Company (a "Dealer Agreement") and
(ii) at any time following the second anniversary of the date hereof,
either party may at its option terminate the Agreement at any time
in order for you to enter into a Dealer Agreement ; provided, that
any such termination shall only be effective upon execution and
delivery of a Dealer Agreement which shall be, unless the parties
thereto otherwise agree, in substantially the form presented to the
Board of the Investment Company and attached hereto as Exhibit B with
such additional changes as may be appropriate to reflect changes in
applicable laws, regulations or industry practice.
3. Dealer and Other Agreements
You may not enter into dealer or similar agreements with
unaffiliated brokers, dealers, banks or other similar firms or
recordkeeping, shareholder servicing and sub-accounting services
with unaffiliated intermediaries without the written consent of the
Investment Company or its authorized designee. No such unaffiliated
intermediary is authorized to act as agent for the Investment Company
in connection with the offering or sale of Shares of the Fund to the
public or otherwise, except for the limited purpose of determining the
time as of which transactions in Shares are deemed to have been
received.
4. Compliance Matters
(a) You shall act as a distributor and principal underwriter
of Shares in compliance in all material respects with all applicable
laws, rules and regulations, including, without limitation, all rules
and regulations made or adopted pursuant to (i) the 1940 Act, (ii) the
Securities Exchange Act of 1934 ("1934 Act"), (iii) any securities
association registered under the 1934 Act, including without limitation
the NASD Conduct Rules or rules of any other applicable self-regulatory
organization. You shall offer the Shares, and accept purchases,
redemptions and exchanges for Shares, in compliance with the Fund's
registration statement (including its prospectus and statement of
additional information), as it may be amended or supplemented from time
to time ("Registration Statement"). You will comply with and abide by
the terms of a Fund's Plan, as it may be amended from time to time.
(b) You agree to submit sales literature and marketing
materials (including memorandums, bulletins, and/or information or
related materials) intended for public distribution ("CGMI Marketing
Materials") to the co-principal underwriter of the Investment Company
which is an affiliate of Xxxx Xxxxx prior to distribution or publication
for written approval. Such CGMI Marketing Materials shall be submitted
15 days in advance for review. You shall be responsible for reviewing
and making such filings with the NASD, as required, of CGMI Marketing
Materials relating to each Fund.
(c) You shall adopt and follow procedures for the confirmation
of sales to investors and qualified securities dealers, banks and other
intermediaries (collectively "Intermediaries") timeliness of orders,
the collection of amounts payable by investors and Intermediaries on such
sales, the correction of errors related to distribution of Shares, the
cancellation of unsettled transactions, and assisting with the
solicitation of proxies, and any other matters governed by Rule 38a-1
under the 1940 Act (as may apply to a distributor or principal underwriter
for a registered investment company), each as may be necessary to comply
with the requirements of the NASD, any other self-regulatory organization,
and the federal securities laws. You shall provide reports or other
information to the Investment Company at the Investment Company's
reasonable request, including, without limitation, reports related to the
operation and implementation of the Investment Company's policies related
to customer privacy, safeguarding of customer information, anti-money-
laundering, sales and marketing practices, the operation of your code of
ethics or other policies and procedures of the Investment Company.
(d) You represent, warrant and agree that you have adopted and
implemented: (i) an anti-money-laundering program in compliance with the
USA Patriot Act of 2001, the regulations thereunder and NASD Conduct Rules,
including, without limitation, customer identification program procedures,
monitoring for suspicious activity, and (ii) procedures to comply with
applicable law and regulation related to cash transaction reporting
requirements, as well as monitoring and reporting under FinCEN, OFAC and
other government watch lists.
(e) The Investment Company agrees that the information
exchanged under the Agreement and information about the respective
customers and potential customers of each is confidential and as such shall
not be disclosed by the Fund, sold or used by the Fund in any way except to
carry out the terms of this Agreement. Notwithstanding the foregoing, such
customer information may be disclosed by the Investment Company on a "need
to know" basis as set forth in applicable privacy rules and regulations.
The obligations regarding confidentiality hereunder shall not apply to any
information which is (i) otherwise publicly available, (ii) already
possessed by the entity to whom the information was disclosed prior to
disclosure hereunder, (iii) independently developed by the entity, or (iv)
disclosed pursuant to law, rule, regulation or court or administrative order.
The Investment Company shall have the right to use any list of shareholders
of the Fund or any other list of investors which it obtains in connection
with its provision of services under this Agreement, provided that such use
is consistent with applicable law and your privacy policies of the Investment
Company, including the provision of information to the Fund's transfer agent
or to agents used for the solicitation of proxies. You agree that you will
comply with all of the foregoing obligations of this to the extent that
information is treated as customer information of the Fund under applicable
law or regulation, including without limitation Regulation S-P. Each party
further agrees to take commercially reasonable steps, in accordance with
applicable law, to safeguard customer information. The provisions of this
paragraph will survive termination of the Agreement.
(f) From time to time, each Fund may implement policies, procedures
or charges in an effort to avoid the potential adverse effects on the Fund
of short-term trading by market timers. You agree to provide other
assistance reasonably designed to achieve compliance with these policies.
You will maintain and enforce policies with respect to frequent trading and
share redemption as are reasonable and customary in the industry. To the
extent that accounts are held in street name, you agree to cooperate with
the Investment Company and the Investment Company's Chief Compliance Officer
(including, to the extent practicable, providing account level sales and
redemption information) to assist in compliance with the frequent trading
and redemption fee provisions as set forth in the Fund's prospectus and other
policies set forth in the Fund's Registration Statement.
(g) Purchases, exchanges and redemptions of Shares through you will
be at the public offering price of such Shares (the net asset value of the
Shares, with appropriate adjustments for any applicable sales charge), as
determined in accordance with the then effective Registration Statement used
in connection with the offer and sale of the Shares. The public offering
price will reflect scheduled variations in or the elimination of sales charges
on sales of Shares either generally to the public or in connection with
special purchase plans, as described in the Registration Statement. You agree
to apply any scheduled variation in or waivers of sales charges uniformly to
all customers meeting the qualifications therefor as specified in the
Registration Statement. With respect to Funds sold with an initial sales
charge, your customers will be entitled to reduced sales charges on purchases
made under any letter of intent or right of accumulation as described in the
Registration Statement.. In such case, the concession from the public
offering price retained by you will be based upon such reduced sales charge.
When placing wire trades, your agree to advise the Funds of any letter of
intent executed by its customer or any available right of accumulation. The
minimum initial purchase and the minimum subsequent purchase of any Shares
shall be as set forth in the applicable Registration Statement. All orders
are subject to acceptance or rejection by the applicable Fund in its sole
discretion for any reason.
(h) The handling and settlement of purchase, exchange and redemption
orders will be subject to the provisions of the Registration Statement and
such further procedures as the Investment Company and you may determine to be
appropriate from time-to-time, consistent with this Amendment. Citigroup
Global Markets' internal systems are suitably designed to handle such orders.
Each Fund shall notify you of the states or jurisdictions in which its Shares
are currently available for sale to the public. The Investment Company shall
have no obligation to register or make available Fund shares in any state or
jurisdiction. You will be responsible for the accuracy, timeliness and
completeness of purchase, redemption or exchange orders accepted by you.
(j) The Investment Company acknowledges that the co-principal
underwriter which is affiliated with Xxxx Xxxxx shall be responsible for
reviewing the Registration Statement of the Fund for the accuracy and
completeness of all disclosure concerning the distribution of Shares and that
you shall not have such responsibility, except, in each case, to the extent
the disclosure information is provided by you or pertains to information
concerning your operations. Notwithstanding the foregoing, nothing in this
paragraph shall alter your responsibilities for complying with the terms of
the Registration Statement in your offering of Shares.
5. Records. Upon the Investment Company's reasonable request, you
will provide access to or make copies of any such records the Investment
Company does not possess in order to: (a) comply with a request from a
government body or self-regulatory organization; (b) verify compliance by
the other party of the terms of this Agreement; or (c) make required
regulatory reports.
6. Section 9 of the 1940 Act. You agree to promptly notify the
Investment Company should you cease to be a member of the NASD through
expulsion or otherwise or if its membership is suspended or should you be
subject to any limitations on your conduct under Section 9 of the 1940 Act.
7. Indemnification
You agree to indemnify, defend and hold the Investment Company,
its several officers and Board members, and any person who controls the
Investment Company within the meaning of Section 15 of the 1933 Act, free
and harmless from and against any and all claims, demands, liabilities and
expenses (including the cost of investigating or defending such claims,
demands or liabilities and any counsel fees incurred in connection therewith)
which the Investment Company, its officers or Board members, or any such
controlling person may incur, under the 1933 Act or under common law or
otherwise, on account of any act of yours or any of your employees
constituting willful misfeasance, bad faith, or gross negligence in the
performance of its duties, or by reason of your reckless disregard of your
obligations and duties under the Agreement or this Amendment. The foregoing
indemnification provisions supplement the indemnification provisions of the
Agreement. The indemnifications provisions of this Amendment and the
Agreement shall survive the termination of the Agreement and/or this
Amendment.
If the foregoing is in accordance with your understanding, kindly
indicate your acceptance of this Amendment by signing and returning to us
the enclosed copy, whereupon this Amendment will become binding on you.
Very truly yours,
Xxxxx Xxxxxx Institutional
Cash Management Fund Inc.
By: _______________________
Name: R. Xxx Xxxxxx
Title: Chief Executive Officer
Agreed to as of the date first above written:
Citigroup Global Markets Inc.
By: _____________________________
Name:
Title:
EXHIBIT A
Fund Date Added:
Cash Portfolio December 1, 2005
Government Portfolio December 1, 2005
Municipal Portfolio December 1, 2005
EXHIBIT B
SELECTED DEALER CONTRACT
Xxxx Xxxxx Investor Services LLC
[Name & address of dealer]
Ladies and Gentlemen:
We, Xxxx Xxxxx Investors Services, LLC ("LMIS"), have agreements
with certain investment companies (each a "Distribution
Agreement") for which [name of asset management entity] or an
affiliate serves as investment adviser (each a "Fund") or series
thereof (each a "Series") provided on Schedule A, as it may be
amended from time to time pursuant to which we act as the
principal underwriter and distributor for the sale of common
shares of the Funds or Series ("Shares"), and as such have the
right to distribute Shares for resale. Each Fund is an open-end
investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act") and the Shares being offered to
the public are registered under the Securities Act of 1933, as
amended (the "1933 Act"). The term "Prospectus", as used herein,
refers to the prospectus and related statement of additional
information (the "Statement of Additional Information")
incorporated therein by reference (each as amended or
supplemented) on file with the Securities and Exchange Commission
at the time in question. We understand that you wish to act as a
dealer with respect to the Shares. You have represented that you
are either a broker-dealer registered with the Securities and
Exchange Commission ("SEC") under the Securities Exchange Act of
1934, as amended, ("1934 Act") and a member in good standing of
the National Association of Securities Dealers, Inc. ("NASD"), or
a "bank" as defined in Section 3(a)(6) of the 1934 Act ("Bank")
and are not required to register as a broker-dealer under the 1934
Act, at the time of each transaction subject to this Agreement.
As a broker in the capacity of principal underwriter and
distributor for the Series, we authorize you, and you hereby agree,
to sell or to arrange for the sale of Shares of each Fund or Series
upon the following terms and conditions, and you agree to perform
certain other services set forth in this Selected Dealer Contract
("Contract"):
1. In all sales to the public you shall act as broker-
dealer for your customers or as dealer for your own account, and in
no transaction shall you have any authority to act as agent for the
Funds or any Series, for us or for any other dealer except for the
limited purpose of determining the time as of which transactions in
Shares are deemed to have been received, in compliance with the
provisions of this Selected Dealer Agreement.
2. Orders received from you will be accepted through us
only at the public offering price per share (i.e. the net asset
value per share plus the applicable front-end sales charge, if any)
applicable to each order, and all orders for redemption of any Shares
shall be executed at the net asset value per share less any
applicable deferred sales charge, if any, in each case as set forth
in the applicable Prospectus. A Fund or Series may additionally
impose redemption fees, as described in the applicable Prospectus.
Any contingent deferred sales charge amounts received or retained by
you shall be paid over by you directly to us or our designated
delegate in partial consideration of our payment to you of any
commission amounts provided by us at the time of sale. The
procedure relating to the handling of orders shall be subject to
provisions of this Agreement and instructions that we or the Fund
shall forward from time to time to you. All orders are subject to
acceptance or rejection by the applicable Fund or us in the sole
discretion of either. The minimum initial purchase and the minimum
subsequent purchase of any Shares shall be as set forth in the
applicable Prospectus. You agree to comply with provisions of Rule
22c-2 under the 1940 Act as applicable to each Fund (including
reporting procedures adopted to comply with the Rule).
3. You shall not place orders for any Shares unless you have
already received purchase orders for those Shares at the applicable
public offering price and subject to the terms hereof. You agree that
you will not offer or sell any Shares except under circumstances that
will result in compliance with the applicable Federal and state
securities or banking laws (including, without limitation, applicable
provisions of the 1933 Act, 1934 Act, 1940 Act and the rules and
regulations of the NASD), any applicable banking laws, the applicable
rules and regulations thereunder and the rules and regulations of
applicable regulatory agencies or authorities (collectively, "Law and
Regulation") and that in connection with sales and offers to sell Shares
you will furnish to each person to whom any such sale or offer is made,
a copy of the Prospectus as and when required under applicable laws,
rules and regulations and, upon request, the Statement of Additional
Information, and will not furnish to any person any information relating
to Shares which is inconsistent in any respect with the information
contained in the Prospectus or Statement of Additional Information (as
then amended or supplemented). You shall not furnish or cause to be
furnished to any person or display or publish any information or
materials relating to the Shares (including, without limitation,
promotional materials and sales literature, advertisements, press
releases, announcements, statements, posters, signs or other similar
material), except such information and materials as may be furnished to
you by, or on behalf of, us or the Funds, and such other information
and materials as may be approved in writing by, or on behalf of, us or
the Funds.
4. If you are a broker dealer, you are hereby authorized (i)
to place orders directly with the applicable Fund or Series for Shares
subject to the applicable terms and conditions governing the placement
of orders by us set forth in the Prospectus and (ii) to tender Shares
directly to each Fund or Series or its agent for redemption subject to
the applicable terms and conditions governing the redemption of Shares
applicable to us set forth in the Prospectus.
5. If you are a Bank, with respect to any and all transactions
in Shares of the Funds or Series pursuant to this Agreement, it is
understood and agreed in each case that unless otherwise agreed to by us
in writing: (i) you shall be acting solely as agent for the account of
your customer; (ii) each transaction shall be initiated solely upon the
order of your customer; (iii) we shall execute transactions only upon
receiving instructions from you acting as agent for your customer; (iv)
as between you and your customer, your customer will have full beneficial
ownership of all Shares; (v) each transaction shall be for the account of
your customer and not for your account; (vi) 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; and (vii) order will comply
with the applicable terms and conditions governing the placement of orders
as set forth in the Prospectus including frequent trading redemption fee
provisions.
6. You shall not withhold placing orders received from your
customers so as to profit yourself as a result of such withholding, e.g.,
by a change in the "net asset value" from that used in determining the
offering price to your customers.
7. You shall provide ongoing shareholder liaison services to the
shareholders of each Fund or Series, including responding to shareholder
inquiries, providing shareholders with information on their investments,
and any other services now or hereafter deemed to be appropriate subjects
for the payment of "service fees" under NASD Conduct Rule 2830.
8. Transactions in the Shares of a Fund or Series may be effected
through the Fund/SERV service of the National Securities Clearing Corporation
(the "NSCC") and, if applicable, account records may be maintained through
the networking service of the NSCC, provided that each party hereto will
comply with all applicable rules of the NSCC and the schedules thereto.
Furthermore, you hereby represent that all of your representations set forth
in your agreement with respect to participating in the NSCC network or in any
schedules thereto are accurate and true as of the date hereof and will remain
accurate and true insofar as the transactions in the Shares of the Fund or
Series are effected through the Fund/SERV service of the NSCC and, if
applicable, the account records are maintained through the networking service
of the NSCC. You will be solely responsible for the accuracy of each
instruction through the Fund/SERV service, and the issuance of a Fund/SERV
instruction will constitute your representation and warranty to us and a
Fund's transfer agent that the instruction is accurate, complete, and issued
as duly authorized by the client whose Shares are the subject of the
instruction.
9. In determining the amount of any sales concession payable to you
hereunder, we reserve the right to exclude any sales which we reasonably
determine are not made in accordance with the terms of the Prospectus and
the provisions of this Agreement. Unless at the time of transmitting an
order we advise you or the transfer agent to the contrary, the Shares ordered
will be deemed to be the total holdings of the specified investor.
10. (a) You agree that payment for orders from you for the purchase of
Shares will be made in accordance with the terms of the Prospectus.On or
before the business day following the settlement date of each purchase order
for Shares, you shall transfer same day funds to an account designated by
us with the transfer agent in an amount equal to the public offering price on
the date of purchase of the Shares being purchased less your sales concession,
if any, with respect to such purchase order determined in accordance with the
Prospectus. If payment for any purchase order is not received in accordance
with the terms of the Prospectus, we reserve the right, without notice, to
cancel the sale and to hold you responsible for any loss sustained as a result
thereof.
(b) If any Shares sold under the terms of this Agreement are sold
with a sales charge and are redeemed or are tendered for redemption within
seven (7) business days after confirmation of your purchase order for such
Shares, you shall forthwith refund to us the full sales concession received
by you on the sale.
(c) We will pay or cause to be paid to you any ongoing
distribution fees and/or shareholder service fees with respect to Shares of
the Series purchased through you and held by or for your customers at such
rates and in such manner as may be described in the Prospectus.
(d) Certificates evidencing Shares generally will not be available.
Upon payment for Shares in accordance with paragraph 10(a) above, the transfer
agent will issue and transmit to you or your customer a confirmation statement
evidencing the purchase of such Shares. Any transaction in uncertificated
Shares, including purchases, transfers, redemptions and repurchases, shall be
effected and evidenced by book-entry on the records of the transfer agent.
(e) We will not accept any conditional orders for Shares
transmitted by you.
(f) Each Fund's Board has adopted a Distribution Plan pursuant
to Rule 12b-1 of the 1940 Act (the "Plans") with respect to the Shares.
Under the terms of the Plans, we may be entitled to compensation for
distribution related services that it provides to the Investment Companies,
and we are permitted to pay all or a portion of such compensation to entities
that engage in or support the distribution of Shares. For the services to be
provided under this Contract and for so long as this Contract remains in
effect, we agree to pay you in accordance with Schedule B.
(g) In the event we do not receive payment from a Fund or Series
under the relevant Distribution Agreement or plan of distribution adopted
pursuant to the applicable Plan or as otherwise provided in the Prospectus,
or if such Distribution Agreement or Plan is cancelled, you agree to waive
your right to receive compensation until such time, if ever, we receive
payment.
11. No person is authorized to make any representations concerning
Shares except those contained in the current Prospectus and Statement of
Additional Information and in printed information subsequently issued by us
or the Funds as information supplemental to the Prospectus and the Statement
of Additional Information. In purchasing or offering Shares pursuant to this
Contract you shall rely solely on the representations contained in the
Prospectus, the Statement of Additional Information and the supplemental
information above mentioned.
12. You agree to deliver to each purchaser making a purchase of
Shares from or through you a copy of the Prospectus as required by applicable
Law and Regulation and, upon request, the Statement of Additional Information.
You may instruct the transfer agent to register Shares purchased in your name
and account as nominee for your customers. You agree thereafter to deliver to
any purchaser whose Shares you or your nominee are holding as record holder
copies of the annual and interim reports and proxy solicitation materials and
any other information and materials relating to the Funds or Series and
prepared by or on behalf of us, the Funds or the investment adviser, custodian,
transfer agent or dividend disbursing agent for distribution to beneficial
holders of Shares. The Funds shall be responsible for the costs associated
with forwarding such reports, materials and other information and shall
reimburse you in full for such costs. You further agree to make reasonable
efforts to endeavor to obtain proxies from such purchasers whose Shares you
or your nominee are holding as record holder. You further agree to obtain
from each customer to whom you sell Shares any taxpayer identification number
certification required under Section 3406 of the Internal Revenue Code of 1986,
as amended (the "Code"), and the regulations promulgated thereunder, and to
provide us or our designee with timely written notice of any failure to obtain
such taxpayer identification number certification in order to enable the
implementation of any required backup withholding in accordance with Section
3406 of the Code and the regulations thereunder. Additional copies of the
Prospectus, Statement of Additional Information, annual or interim reports,
proxy solicitation materials and any such other information and materials
relating to the Funds will be supplied to you in reasonable quantities upon
request.
13. (a) In accordance with the terms of the Prospectus, a
reduced sales charge or no sales charge (collectively, "discounts") may be
available to purchasers of Shares or certain classes of investors, depending
on the amount of the investment or proposed investment. In each case where a
discount is applicable, you agree to furnish to the transfer agent sufficient
information to permit confirmation of qualification for a discount, and
acceptance of the purchase order is subject to such confirmation. Discounts
may be modified or terminated at any time in the sole discretion of each Fund.
(b) You agree to advise us promptly as to the amount of any and
all sales by you qualifying for a discount.
(c) Exchanges (i.e., the investment of the proceeds from the
liquidation of Shares of one Series in the Shares of another Series, each of
which is managed by the same or an affiliated investment adviser) shall,
where available, be made in accordance with the terms of each Prospectus.
(d) You represent that you have, and will maintain during the
term of this Contract, adequate written supervisory procedures and internal
controls to ensure that your customers receive all available discounts, and
you agree: (i) to inform your customers of applicable discount opportunities
and to inquire about other qualifying holdings that might entitle customers
to receive discounts; (ii) to advise us, contemporaneously with each purchase
order you forward to us as agent for your customers, of the availability of
any discounts; and (iii) that in the event that you fail to provide us with
information concerning the availability of discounts as provided in (ii)
above, you, and not us or the Funds, shall be responsible for reimbursing
your customer any applicable discount amount.
14. As a result of the necessity to compute the amount of any
contingent deferred sales charge or redemption charge due with respect to
the redemption of Shares, you may hold Shares of a Fund imposing such a
charge in a "street name" account with our consent, and, in such event, you
shall be responsible for computation, collection and payment to us of such
charges, the application of any discounts, the application of Fund or Series'
market-timing policies, all in accordance with the applicable Prospectus for
the Fund or Series. Except as otherwise permitted by us, Shares owned by a
hareholder must be in a separate identifiable account for such shareholder.
15. (a) We and each Fund reserve the right in our discretion, without
notice, to suspend sales or withdraw the offering of any Shares entirely. Each
party hereto has the right to terminate this Contract without penalty upon
notice to the other party; provided, however, that termination shall not affect
any party's obligations hereunder with respect to any. transactions or
activities occurring prior to the effective time of termination. Upon .
termination of this Contract, ongoing trail commissions and/or shareholder
servicing fees shall no longer accrue or be paid to you. We reserve the right
to amend this Contract in any respect effective on notice to you and your
placing of an order after the effective date of any such amendment shall
constitute your acceptance thereof. Each notice of amendment required by this
paragraph shall be given in writing and delivered personally or mailed by
certified mail or overnight courier service or sent by facsimile to the address
identified herein or such other address as you may by written notice provide.
(b) Each party hereto agrees to provide prompt notice to the other
party in the event of an assignment to this Contract.
16. We shall have full authority to take such action as we may deem
advisable in respect of all matters pertaining to the continuous offering of
Shares. We shall be under no liability to you except for lack of good faith
and for obligations expressly assumed by us herein. Nothing contained in
this paragraph 16 is intended to operate as, and the provisions of this
paragraph 16 shall not in any way whatsoever constitute a waiver by you of
compliance with, any provisions of the 1933 Act or of the rules and regulations
of the SEC issued thereunder.
17. You agree that: (a) you shall not effect any transactions
(including, without limitation, any purchases and redemptions) in any Shares
registered in the name of, or beneficially owned by, any customer unless such
customer has granted you full right, power and authority to effect such
transactions on his behalf, (b) we shall have full authority to act upon your
express instructions to sell, repurchase or exchange Shares through us on
behalf of your customers under the terms and conditions provided in the
Prospectus and (c) you shall indemnify and hold harmless the Funds, us and both
of our respective affiliates, representatives and agents, successors and
assigns, officers and directors, and each person who controls either us or the
Funds (within the meaning of Section 15 of the 0000 Xxx) from and against any
and all direct or indirect costs, claims, expenses, liabilities or losses,
including attorney's fees resulting from (i) any alleged violation of any
statute or regulation or rule of a self-regulatory organization (including,
without limitation, the securities laws and regulations of the United States or
any state or jurisdiction or the NASD Conduct Rules) or any alleged tort or
breach of contract, related to the offer or sale by you of Shares of the Funds
pursuant to this Contract (except to the extent that our negligence or failure
to follow correct instructions received from you is the cause of such loss,
claim, liability, cost or expense); (ii) requests, directions, actions or
inactions of or by you, your officers, directors, employees, partners or agents
regarding the purchase, redemption or transfer of registration of Shares of the
Funds for your accounts, your customers and other shareholders or from any
unauthorized or improper use of any on-line computer facilities; (iii)
incorrect investment instructions received by us or a Fund or Fund agent from
you; or (iv) the breach by you of any of your representations, warranties or
agreements specified herein or your failure to comply with the terms and
conditions of this Contract.
We agree to indemnify you and hold you harmless from and against any
and all liabilities and losses resulting directly from (i) any misstatement of
a material fact in the Prospectus of a Fund or Series or the omission of any
material fact required to be stated in the Prospectus of a Fund or Series or
necessary to make the statements in the Prospectus not misleading; or (ii) our
failure to comply with the terms and conditions of this Contract. The
foregoing indemnification provisions shall survive termination of this
Contract.
18. (a) You shall be permitted to accept orders for the
purchase, exchange or redemption of Shares of the Funds on each business day
that the New York Stock Exchange ("NYSE") is open for business and a Fund's net
asset value is determined ("Business Day"). Instructions received in proper
form by you prior to time of acceptance for orders set forth in the applicable
Prospectus ("Close of Trading") (generally the close of regular trading on the
NYSE, which is generally 4:00 p.m. Eastern Time), and with respect to which you
transmit orders to the Fund via the NSCC Fund/SERV system up to the latest time
accepted by Fund/SERV on a given Business Day, will be deemed to have occurred,
and will be credited to the respective account, at the per share NAV next
calculated after the Close of Trading on that Business Day. You will not
transmit orders based on Instructions received from Shareholders after the
Close of Trading for that Business Day's NAV.
(b) The offering price ("Offering Price") of Shares of each
Investment Company shall be the net asset value per share as next determined
by the Investment Company following receipt of an order at Financial
Intermediary's principal office, plus any applicable sales charge.
(c) You agree to maintain records sufficient to identify the
date and time of receipt of all customer transactions or as otherwise required
by applicable Law and Regulation. You further agree to make such records
available upon request for examination by us, or its designated representative,
at the request of the transfer agent or by appropriate governmental
authorities. Under no circumstances shall you change, alter or manipulate any
customer transactions received by you in good order.
19. Solely for the limited purpose of receiving orders for the
Shares of the Funds by customers prior to the Close of Trading on a Business
Day and communicating such orders after the Close of Trading on such Business
Day, you will be deemed to act as agent of the Funds. Each communication of
orders by you shall constitute a representation that such orders were received
by us prior to the calculation of net asset value, as described in the
applicable Prospectus on the Business Day on which the order is priced in
accordance with Rule 22c-1 under the Investment Company Act of 1940. You
represent and warrant that: (i) there are controls in place designed to prevent
market timing, (ii) you will use your best fforts to assist us in identifying
market timers or investors who engage in a pattern of short-term trading, and
(iii) your internal systems for processing and transmitting orders are suitably
designed to prevent orders received at or after the Close of Trading from being
aggregated with orders received before the Close of Trading.
20. You agree that, with respect to the compensation you receive in
connection with the offering of Shares or transactions involving Shares
(including payments from us or our affiliates), you will make or cause to be
made disclosure of such payments in accordance with applicable Law and
Regulation.
21. You agree that it is your responsibility to evaluate and
determine that any transaction in Shares (including a transaction in a specific
class of Shares of a Fund or Series) is a suitable transaction for each client
based on the client's objectives and risk profile. If you are a Bank, you
further represent and warrant to us that you will use your best efforts to
ensure that any purchase of Shares by your customers constitutes a suitable
investment for such customers. You shall not effect any transaction in, or
induce any purchase or sale of, any Shares 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.
22. If you are a Bank, you will not make Shares available to your
customers, including your fiduciary customers, or accept any fees or
compensation hereunder except in compliance with all Law and Regulation
applicable to you, or any of your affiliates engaging in such activity,
including without limitation ERISA and regulated rules, regulations and
interpretations, which may affect your business practices.
23. In selling Shares you will comply with all applicable Law and
Regulation, including the applicable Law and Regulation of the jurisdictions
in which you sell any Shares directly or indirectly.
24. You represent and warrant to us and the Funds:
(a) You have in place an anti-money laundering program ("AML program")
that does now and will continue to comply with applicable laws and regulations,
including the relevant provisions of the Bank Secrecy Act and the USA PATRIOT
Act (Pub. L. No. 107-56 (2001)), as they may be amended, and the regulations
issued thereunder by duly vested regulatory authority and the conduct the Rules
of the NASD and the New York Stock Exchange, Inc., as applicable ("Anti-Money
Laundering Law and Regulation").
(b) You have, after undertaking reasonable inquiry, no information or
knowledge that (i) any customers that you introduce to the Funds or on whose
behalf you purchase Shares, or (ii) any person or entity controlling,
controlled by or under common control with such customers is an individual or
entity or in a country or territory that is on an Office of Foreign Assets
Control ("OFAC") list or similar list of sanctioned or prohibited persons
maintained by a U.S. governmental or regulatory body.
(c) You have in place, and have conducted due diligence pursuant
to, policies, procedures and internal controls reasonably designed (i) to
verify the identity of the customers that you introduce to the Funds or on
whose behalf you purchase Shares, and (ii) to identify those customers' sources
of funds, and have no reason to believe that any of the invested funds were
derived from illegal activities.
(d) You will provide us or the Funds (or their service providers)
upon reasonable request any information regarding specific accounts that may
be reasonably necessary for the Funds and their service providers to fulfill
their responsibilities relating to their anti-money laundering programs or any
other information reasonably requested by us or the Funds (or their service
providers) to assist with compliance with the Anti-Money Laundering Law and
Regulation, as may be permitted by law or regulation.
(e) You will promptly notify us should you become aware of any change
in the above representations and warranties. In addition, we on our own
behalf and on behalf of the Funds hereby provide notice to you that we and/or
the Funds reserve the right to make inquires of and request additional
information from you regarding your AML program.
25. (a) You represent and warrant that you have adopted and
implemented procedures to safeguard customer information and records that are
reasonably designed to ensure the security and confidentiality of customer
records and information and to ensure your compliance with the SEC's Regulation
S-P or other applicable privacy law. Both of us agree on behalf of ourselves,
our affiliates and employees that the terms of this Contract, information
exchanged hereunder and information about our respective customers and
potential customers is confidential and as such shall not be disclosed, sold or
used in any way except to carry out the terms of this Contract.
Notwithstanding the foregoing, such confidential information may be disclosed
on a "need to know" basis as set forth in applicable privacy rules and
regulations. The obligations regarding confidentiality hereunder shall not
apply to any information which is (i) otherwise publicly available, (ii)
already possessed by the entity to whom the information was disclosed prior to
disclosure hereunder, (iii) independently developed by the entity, or (iv)
disclosed pursuant to law, rule, regulation or court or administrative order.
The provisions of this paragraph shall survive termination of this Contract.
(b) You represent and warrant that the security of your computer
system is commercially reasonable and reasonably designed to prevent any
illegal or injurious activities of persons (including persons outside of you)
attempting to access a computer system maintained or operated by or on behalf
of us or the Funds through your computer system.
26. You agree that you will promptly forward any client complaints
or threatened or pending litigation notices specifically relating to the
management of the Funds, whether written or if verbal, in the form of a written
summary, to us or our designated party. We or our designated party will
undertake to investigate and respond to the complaint or threatened or pending
litigation notices in line with our complaints and litigation procedures.
You agree to fully cooperate with such investigation and response.
27. (a) If you are a broker-dealer, you represent and warrant that:
(a) you are a member in good standing of the NASD, or, if a foreign dealer who
is not eligible for membership in the NASD, that (i) you will not make any
sales of Shares in, or to nationals of, the United States of America, its
territories or its possessions, and (ii) in making any sales of Shares you will
comply with the NASD's Conduct Rules and (b) you are a member in good standing
of the Securities Investor Protection Corporation ("SIPC"). You agree to
notify us immediately in the event of (i) your expulsion or suspension from
the NASD or SIPC, or (ii) the institution of an investigation or proceeding by
any federal, state or self-regulatory organization against you alleging that
you have violated any applicable federal or state law, rule or regulation or
any rule of the NASD or of SIPC arising out of your activities as a broker-
dealer or bank, as appropriate, or in connection with this Contract, or which
may otherwise affect in any material way its ability to act in accordance with
the terms of this Contract. We shall have the right to terminate immediately
upon receipt of such notice.(b) You represent and warrant that (i) each
employee and agent of yours who shall engage in the offering or sale of Shares
is currently duly licensed under applicable federal and state laws and
regulations, and, if you are a broker-dealer, with the NASD, and (ii) you shall
not permit any employee or agent to offer or sell Shares unless such person is
duly licensed under applicable federal and state laws and regulations, and with
the NASD.
28. If you are a Bank or distributing through a Bank affiliate, you
or the affiliate represent and warrant that you or the affiliate are not in
violation of any banking law, rule or regulations as to which you are subject
and that the transactions contemplated by this Contract will not result in any
violations of any banking law, rule or regulation.
29. You agree that it is your responsibility to provide proper
instruction, training and supervision of appropriate sales personnel in order
that Shares will be offered and sold in accordance with the terms and
conditions of this Contract and in accordance with all applicable laws. You
also agree that it is your responsibility to assure that your sales personnel
are properly licensed, certified and familiar with the Funds, Series and any
classes thereof.
30. You represent and warrant that you will not offer Shares of
any Fund or Series for sale in any state or jurisdiction where such Shares may
not be legally sold or where you are not qualified to act as a broker-dealer.
We shall inform you as to the states or other jurisdictions in which the Fund
or Series has advised us that Shares have been qualified for sale under, or
are exempt from the requirements of, the respective securities laws of such
states.
31. You agree to distribute or cause to be delivered to your
customers Prospectuses, proxy solicitation materials, shareholder reports and
other materials in compliance with applicable legal requirements, except to
the extent that we undertake to do so.
32. (a) We shall notify you of the states or other jurisdictions
in which Shares are currently available for sale to the public. We shall have
no obligation to register or make available Shares in any state or other
jurisdiction.
(b) [You shall provide to the transfer agent of each Fund or Series
each client's state of residency on each trade record and registration record
so we can monitor trades for blue sky compliance. The Fund or its agent will
reject any ineligible trades and notify you upon cancellation.]
33. You shall not incur, nor does it have the authority to incur,
any debts or obligations on behalf of us or any Fund or Series.
34. You shall provide any assistance that we or the Funds
reasonably request in connection with a Fund's or Series' solicitation of
proxies.
35. Any claim, controversy, dispute or deadlock arising under this
agreement (collectively, a "Dispute") shall be settled by arbitration
administered in accordance with the rules and regulations of the NASD. Any
arbitration and award of the arbitrators, or a majority of them, shall be final
and the judgment upon the award rendered may be entered in any state or federal
court having jurisdiction. No punitive damages are to be awarded.
36. All communications to us should be sent, postage prepaid,
to __________________. Any notice to you shall be duly given if mailed,
telegraphed or telecopied to you at the address specified by you below.
Communications regarding placement of orders for Shares should be sent, postage
prepaid, to ________________________________________.
37. This Contract shall be binding upon both parties hereto when
signed by us and accepted by you in the space provided below; provided,
however, that you shall not have any obligations hereunder other than in
respect of the duties and agreements expressly undertaken and made by you
herein.
38. This Contract and the terms and conditions set forth herein
shall be governed by, and construed in accordance with, the laws of the State
of Maryland. To the extent that the applicable laws of the State of Maryland
conflict with the applicable provisions of the federal securities laws, the
latter shall control.
39. To the extent a Fund or Series imposes a redemption fee as
provided in the applicable Prospectus, you agree to abide and comply with the
terms of the attached Redemption Fee Addendum.
40. This Contract shall not be construed to constitute a
partnership, joint venture, or agency between you and us or any Fund or Series,
nor to create an employer-employee relationship between you and us. You
acknowledge that you are an independent contractor, that your business is its
own and entirely separate from that of ours and the Funds and Series, and that
you will not deal with or represent itself to the public in any other way.
41. You agree to provide us with any assistance or report that we
reasonablyrequest in order to fulfill our duties to assist the Funds with
compliance with Rule 38a-1 under the 1940 Act, in our capacity as principal
underwriter to each Fund.
Xxxx Xxxxx Investor Services, LLC
By:
Managing Director
Accepted:
Firm Name: _____________________________
NASD Registration
Number: _____________________________
By: _____________________________
Address: _____________________________
_____________________________
Accepted By (signature):
Name (print): Title:
Date:
SCHEDULE A - FUNDS
[insert funds]
SCHEDULE B - COMPENSATION
Beginning on the effective date of this Contract, for each Fund listed on
Schedule A, Xxxx Xxxxx will pay the Financial Intermediary a quarterly fee
equal on an annual basis to [0.25%] of the average daily net asset value of
[Financial Intermediary Shares of Funds] owned beneficially by clients of
the Financial Intermediary during such period.
*Institutional shares do not pay service fees
Redemption Fee Addendum
