EXHIBIT 99(m)(4)
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ProFunds
DISTRIBUTION AND SHAREHOLDER SERVICES AGREEMENT
Name: __________________________
Address: __________________________
__________________________
__________________________
Ladies and Gentlemen:
ProFunds (the "Trust") is an open-end management investment company
organized as a Delaware business trust and registered with the Securities and
Exchange Commission (the "SEC") under the Investment Company Act of 1940, as
amended (the "1940 Act"). On behalf of each of the ProFund series of the Trust
identified in Schedule A, as amended from time to time ("Funds"), the Trustees
of the Trust have adopted a Distribution and Service Plan (the "Plan") pursuant
to Rule 12b-1 under the 1940 Act that, among other things, authorizes Concord
Financial Group, Inc. ("Concord"), as principal underwriter of the shares of the
Funds, to enter into this Agreement with you (the "Authorized Firm"), concerning
the financing of activities and services (collectively, "Services") set forth in
Section 2 on behalf of your clients, members, or customers ("Customers") who may
from time to time be investors, or prospective investors, in the Service Class
shares (the "Shares") of the Funds. The terms and conditions of this Agreement
are as follows:
1. REFERENCE TO PROSPECTUS; DETERMINATION OF NET ASSET VALUE.
1.1. Reference is made to the prospectus for the Shares of each Fund as from
time to time are effective under the Securities Act of 1933 (the "1933
Act"). Terms defined therein and not otherwise defined herein are used
herein with the meaning so defined.
1.2. For purposes of determining the fees payable to you under Section 3, the
average daily net asset value of a Fund's Shares will be computed in the
manner specified in the Trust's registration statement (as the same is in
effect from time to time) in connection with the computation of the net
asset value of such Fund's Shares for purposes of purchases and
redemptions.
2. SERVICES OF AUTHORIZED FIRM.
2.1. The Authorized Firm is hereby authorized and may from time to time
undertake to perform, or arrange for the performance of, some or all of the
following non-exclusive list of Services:
. the provision of personal and continuing services to beneficial owners
of Shares;
. receiving, aggregating and processing purchase, exchange and
redemption orders of shareholders;
. providing and maintaining retirement plan records;
. communicating periodically with shareholders concerning administrative
issues relating to their accounts, and answering questions and
handling correspondence from shareholders about their accounts;
. maintaining account records and providing beneficial owners with
account statements;
. processing dividend payments for Shares held beneficially;
. providing sub-accounting services for Shares held beneficially;
. issuing shareholder reports and transaction confirmations;
. forwarding shareholder communications to beneficial owners of Shares;
. receiving, tabulating and transmitting proxies executed by beneficial
owners of Shares;
. performing daily investment ("sweep") functions for shareholders;
. providing investment advisory services;
. general account administration activities;
. advertising, preparation of sales literature and other promotional
materials, and related printing and distribution expenses;
. paying employees or agents of the distributor of the Shares, other
securities broker-dealers, sales personnel, or "associated persons" of
the Trust who engage in or support the provision of services to
investors and/or distribution of the Shares, including salary,
commissions, telephone, travel and related overhead expenses;
. incurring expenses of training sales personnel regarding the Funds;
. preparing, printing and distributing prospectuses, statements of
additional information and reports to prospective investors;
. organizing and conducting sales seminars and meetings;
. paying fees to one or more Authorized Firms in respect of the average
daily value of Shares beneficially owned by investors for whom the
Authorized Firm is the dealer of record or holder of record, or
beneficially owned by shareholders with whom the Authorized Firm has a
servicing relationship;
. incurring costs and expenses in implementing and operating the Plan,
including capital or other expenses of associated equipment, rent,
salaries, bonuses, interest, and other overhead or financing charges;
and
. such other similar activities and services as determined by the
Trust's Board of Trustees from time to time.
2.2. The Authorized Firm is specifically authorized to distribute the Prospectus
and Statement of Additional Information and sales material received from
Concord. No person is authorized to distribute any other sales material
relating to a Fund without Concord's prior written approval. The Authorized
Firm further agrees to deliver, upon Concord's request, copies of any
relevant amended Prospectus and Statement of Additional Information to
shareholders of the Trust to whom it has sold Shares. As agent for its
customers, the Authorized Firm shall not withhold placing customers' orders
for any Shares so as to profit itself as a result of such withholding and
shall not purchase any Shares from Concord except for the purpose of
covering purchase orders already received.
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Notice will be given to the Authorized Firm of any repurchase or redemption
within ten days of the date on which the tender of Shares for redemption is
delivered to Concord or to the Trust. Neither party to this Agreement shall
purchase any Shares from a record holder at a price lower than the net
asset value next computed by or for the Trust. Nothing in this subparagraph
shall prevent the Authorized Firm from selling Shares for the account of a
record holder to Concord or the Trust and charging the investor a fair
commission for handling the transaction. Any order placed by the Authorized
Firm for the repurchase of Shares of a Fund is subject to the timely
receipt by the Trust or its designee of all required documents in good
order. If such documents are not received within a reasonable time after
the order is placed, the order is subject to cancellation, in which case
the Authorized Firm agrees to be responsible for any loss resulting to the
Trust or to Concord from such cancellation.
Concord will furnish the Authorized Firm, upon request, with offering
prices for the Shares in accordance with the then-current Prospectuses for
the Funds, and the Authorized Firm agrees to quote such prices subject to
confirmation by Concord on any Shares offered to the Authorized Firm for
sale. The public offering price shall equal the net asset value per Share
of a Fund plus a front-end sales load, if applicable. For Funds with a
front-end sales load, the Authorized Firm will receive a discount from the
public offering price as outlined in the current Prospectus. For Funds with
a contingent deferred sales load, the Authorized Firm will receive from
Concord, or a paying agent appointed by Concord or the Trust, a commission
in the amount shown in Schedule B. Concord reserves the right to waive
sales charges. Each price is always subject to confirmation, and will be
based upon the net asset value next computed after receipt by the Trust or
its designee of an order that is in good form. The Authorized Firm
acknowledges that it is its responsibility to date and time stamp all
orders received by it and to transmit such orders promptly to the Trust or
its designee. The Authorized Firm further acknowledges that any failure to
promptly transmit such orders that causes a purchaser of Shares to be
disadvantaged, based upon the pricing requirements of Rule 22c-1 under the
1940 Act, shall be its sole responsibility. Concord reserves the right to
terminate this Agreement at any time, effective immediately, if any Shares
shall be offered for sale by the Authorized Firm at less than the then-
current offering price determined by or for the applicable Fund.
With respect to orders that are placed for the purchase of Fund Shares,
unless otherwise agreed, settlement shall be made with the Trust within
three (3) business days after acceptance of the order. If payment is not so
received or made, Concord reserves the right to cancel the sale, or, at its
option, to sell the Shares to the Funds at the then prevailing net asset
value. In this event or in the event that the Authorized Firm cancels the
trade for any reason, the Authorized Firm agrees to be responsible for any
loss resulting to the Funds or to Concord from its failure to make payments
as aforesaid. The AuthorizedFirm shall not be entitled to any gains
generated thereby.
The Authorized Firm shall be responsible for the accuracy, timeliness and
completeness of any orders transmitted by it on behalf of its customers by
wire or telephone for purchases, exchanges or redemptions, and shall
indemnify Concord against any claims by its customers as a result of its
failure to properly transmit their instructions. In addition,
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the Authorized Firm agrees to guarantee the signatures of its customers
when such guarantee is required by the Prospectus of a Fund. In that
connection, the Authorized Firm agrees to indemnify and hold harmless all
persons, including Concord and the Funds' Transfer Agent, against any and
all loss, cost, damage or expense suffered or incurred in reliance upon
such signature guarantee.
2.3. The Authorized Firm will provide such office space and equipment, telephone
facilities, and personnel (which may be any part of the space, equipment,
and facilities currently used in the Authorized Firm's business, or any
personnel employed by the Authorized Firm) as may be reasonably necessary
or beneficial in order to provide such Services.
2.4. The minimum dollar purchase of a Fund's Shares (including Shares being
acquired by Customers pursuant to any exchange privileges described in the
Fund's prospectus) shall be the applicable minimum amount set forth in the
prospectus of such Fund, and no order for less than such amount shall be
accepted by the Authorized Firm. The procedures relating to the handling of
orders shall be subject to instructions which Concord shall forward from
time to time to the Authorized Firm. All orders for a Fund's Shares are
subject to acceptance or rejection by the Trust in its sole discretion, and
the Trust may, in its discretion and without notice, suspend or withdraw
the sale of a Fund's Shares, including the sale of such Shares to the
Authorized Firm for the account of any Customer or Customers.
2.5. In no transaction shall the Authorized Firm act as dealer for its own
account; the Authorized Firm shall act solely for, upon the specific or
pre-authorized instructions of, and for the account of, its Customers. For
all purposes of this Agreement, the Authorized Firm will be deemed to be an
independent contractor, and will have no authority to act as agent for the
Trust, Concord or any dealer of the Shares in any matter or in any respect.
No person is authorized to make any representations concerning the Trust or
a Fund's Shares except those representations contained in the Fund's then-
current prospectus and statement of additional information and in such
printed information as the Trust may subsequently prepare.
2.6. The Authorized Firm and its employees will, upon request, be available
during normal business hours to consult with Concord or its designees
concerning the performance of the Authorized Firm's responsibilities under
this Agreement. Any person authorized to direct the disposition of monies
paid or payable pursuant to Section 3 of this Agreement will provide to the
Trust's Board of Trustees, and the Trust's Trustees will review at least
quarterly, a written report of the amounts so expended and describe the
purposes for which the expenditures are made.
In addition, the Authorized Firm will furnish to Concord or its designees
such information as Concord or its designees may reasonably request
(including, without limitation, periodic certifications confirming the
rendering of Services as described herein), and will otherwise cooperate
with Concord and its designees (including, without limitation, any auditors
designated by the Trust), in the preparation of reports to the Trust's
Board of Trustees concerning this Agreement and the monies paid or payable
pursuant hereto, as well as any other reports or filings that may be
required by law.
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3. FEES.
3.1. In consideration of the costs and expenses of furnishing the Services and
facilities provided by the Authorized Firm hereunder, and subject to the
limitations of applicable law and regulations and the rules of the National
Association of Securities Dealers, Inc. ("NASD'), the Authorized Firm will
be compensated and/or reimbursed (as applicable) monthly at an annual rate
of up to, but not more than, 1.00% of the average daily net assets of each
Fund attributable to the Fund's Shares which are attributable to or held in
the name of the Authorized Firm for its Customers. The fee will not be paid
to the Authorized Firm with respect to Shares of a Fund that are redeemed
or repurchased by the Trust within seven business days of receipt of
confirmation of such sale.
3.2. The fee rate with respect to any Fund may be prospectively increased or
decreased by Concord, in its sole discretion, at any time upon notice to
the Authorized Firm.
4. REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
4.1. The Authorized Firm agrees to comply with all applicable laws, including
federal and state securities laws, the Rules and Regulations of the
Securities and Exchange Commission and the Conduct Rules of the NASD. The
Authorized Firm has received a list of the states or other jurisdictions in
which Shares of the Funds have been registered for sale under, or otherwise
qualified for sale pursuant to, the respective securities laws of such
states and jurisdictions. The Authorized Firm agrees that it will not offer
a Fund's Shares to persons in any jurisdiction in which such Shares are not
registered or otherwise qualified for sale.
4.2 By written acceptance of this Agreement, the Authorized Firm represents,
warrants, and agrees that, to the extent required by law: (i) the
Authorized Firm has all necessary qualifications, authorizations and/or
registrations relating to the Authorized Firm's participation in this
Agreement and the transactions contemplated hereby or relating to any
activities of any persons or entities affiliated with the Authorized Firm
performed in connection with the discharge of its responsibilities under
this Agreement; (ii) the Authorized Firm will provide to Customers a
schedule of the services it will perform pursuant to this Agreement and a
schedule of any fees that the Authorized Firm may charge directly to
Customers for services it performs in connection with investments in the
Trust on the Customer's behalf; and (iii) any and all compensation payable
to the Authorized Firm by Customers in connection with the investment of
their assets in the Trust will be disclosed by the Authorized Firm to
Customers and will be authorized by Customers and will not result in an
excessive fee to the Authorized Firm.
4.3. The Authorized Firm agrees to comply with all requirements applicable to it
by reason of all applicable laws, including federal and state securities
laws, the rules and regulations of the SEC, including, without limitation,
all applicable requirements of the 1933 Act, the Securities Exchange Act of
1934, the Investment Advisers Act of 1940, and the 1940 Act. Concord has
furnished the Authorized Firm with a list of the states or other
jurisdictions in which the Trust believes the Shares of the Funds are
qualified for sale, and the Authorized Firm agrees that it will not
purchase a Fund's Shares on behalf of a
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Customer's account in any jurisdiction in which such Shares are not
qualified for sale. The Authorized Firm further agrees that it will
maintain all records required by applicable law or otherwise reasonably
requested by Concord relating to the services provided by it pursuant to
the terms of this Agreement.
4.4. The Authorized Firm agrees that under no circumstances shall Concord or the
Trust be liable to the Authorized Firm or any other person under this
Agreement as a result of any action by the SEC affecting the operation or
continuation of the Plan.
5. EXCULPATION; INDEMNIFICATION.
5.1. Concord shall not be liable to the Authorized Firm and the Authorized Firm
shall not be liable to Concord except for acts or failures to act which
constitute lack of good faith or negligence and for obligations expressly
assumed by either party hereunder. Nothing contained in this Agreement is
intended to operate as a waiver by Concord or by the Authorized Firm of
compliance with any applicable law, rule, or regulation.
5.2. The Authorized Firm will indemnify Concord and hold it harmless from any
claims or assertions relating to the lawfulness of the Authorized Firm's
participation in this Agreement and the transactions contemplated hereby or
relating to any activities of any persons or entities affiliated with the
Authorized Firm performed in connection with the discharge of its
responsibilities under this Agreement. If any such claims are asserted,
Concord shall have the right to manage its own defense, including the
selection and engagement of legal counsel of its choosing, and all costs of
such defense shall be borne by the Authorized Firm.
6. EFFECTIVE DATE; TERMINATION.
6.1. This Agreement will become effective with respect to each Fund on the date
of its acceptance by the Authorized Firm. Unless sooner terminated with
respect to any Fund, this Agreement will continue with respect to a Fund
until terminated in accordance with its terms, provided that the
continuance of the Plan is specifically approved at least annually in
accordance with the terms of the Plan.
6.2. This Agreement will automatically terminate with respect to a Fund in the
event of its assignment (as such term is defined in the 0000 Xxx) or upon
termination of the Plan. This Agreement may be terminated with respect to
any Fund by Concord or by the Authorized Firm, without penalty, upon sixty
days' prior written notice to the other party. This Agreement may also be
terminated with respect to any Fund at any time without penalty by the vote
of a majority of the Plan Trustees (as defined in the Plan) or a majority
of the outstanding Shares of a Fund on sixty days' written notice.
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7. GENERAL.
7.1. All notices and other communications to either the Authorized Firm or the
Trust will be duly given if mailed, telegraphed or telecopied to the
appropriate address set forth below or at such other address as either
party may provide in writing to the other party:
if to Concord: Concord Financial Group, Inc.
0000 Xxxxxxx Xxxx
Xxxxx 0000
Xxxxxxxx, Xxxx 00000-0000
Attn: President
if to the Authorized Firm: __________________
__________________
__________________
7.2. Concord may enter into other similar agreements for the provision of
Services with any other person or persons without the Authorized Firm's
consent.
7.3. Upon receiving the written consent of Concord, the Authorized Firm may, at
its expense, subcontract with any entity or person concerning the provision
of the Services contemplated hereunder; provided, however, that the
Authorized Firm shall not be relieved of any of its obligations under this
Agreement by the appointment of such subcontractor and provided further,
that the Authorized Firm shall be responsible, to the extent provided in
Article 5 hereof, for all acts of such subcontractor as if such acts were
its own.
7.4. This Agreement supersedes any other agreement between Concord and the
Authorized Firm relating to the Services described herein in connection
with a Fund's Shares and relating to any other matters discussed herein.
All covenants, agreements, representations, and warranties made herein
shall be deemed to have been material and relied on by each party,
notwithstanding any investigation made by either party or on behalf of
either party, and shall survive the execution and delivery of this
Agreement. The invalidity or unenforceability of any term or provision
hereof shall not affect the validity or enforceability of any other term or
provision hereof. The headings in this Agreement are for convenience of
reference only and shall not alter or otherwise affect the meaning hereof.
This Agreement may be executed in any number of counterparts which together
shall constitute one instrument and shall be governed by and construed in
accordance with the laws (other than the conflict of laws rules) of the
State of Ohio and shall bind and inure to the benefit of the parties hereto
and their respective successors.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below.
Concord Financial Group, Inc.
By: __________________________________
Title:_______________________________
The foregoing Agreement is hereby accepted:
_____________________________________
Authorized Firm
By:__________________________________
Title: _____________________________
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SCHEDULE A
TO THE DISTRIBUTION AND SHAREHOLDER SERVICES AGREEMENT
Money Market ProFund Healthcare UltraSector ProFund
Bull ProFund Industrial UltraSector ProFund
UltraBull ProFund Internet UltraSector ProFund
Bear ProFund Pharmaceuticals UltraSector ProFund
UltraBear ProFund Precious Metals UltraSector ProFund
UltraOTC ProFund Real Estate UltraSector ProFund
UltraShort OTC ProFund Semiconductor UltraSector ProFund
UltraEurope ProFund Technology UltraSector ProFund
UltraSmall-Cap ProFund Telecommunications UltraSector ProFund
UltraMid-Cap ProFund Utilities UltraSector ProFund
UltraJapan ProFund Wireless Communications UltraSector
Basic Materials UltraSector ProFund ProFund
Biotechnology UltraSector ProFund OTC ProFund
Consumer Cyclical UltraSector ProFund Airline UltraSector ProFund
Consumer Non-Cyclical UltraSector Banking UltraSector ProFund
ProFund Entertainment and Leisure UltraSector
Energy UltraSector ProFund ProFund
Financial UltraSector ProFund Oilfield Equipment and Services
UltraSector ProFund
SCHEDULE B
TO THE DISTRIBUTION AND SHAREHOLDER SERVICES AGREEMENT
Commission Amount Payable for
Funds Charging a Contingent Deferred Sales Load
1. __ __ percent of the public offering price
2. __ Not Applicable
