Exhibit No. 5(c)
SELECTED DEALER AGREEMENT
This Selected Dealer Agreement ("Agreement") is entered into as of
__________, 2001, by and between Xxxxxxx Advisors, Inc. ("We" or "Us") and
________________________ ("You"). We are the exclusive national distributor of
the shares ("Shares") of the investment companies listed on Schedule A hereto
("Funds"), each of which is registered under the Investment Company Act of 1940,
as amended ("1940 Act") or is a series of a registered investment company. We
understand that you wish to act as a Selected 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.
In consideration of the mutual covenants stated below, you and we hereby
agree as follows:
1. SALE OF SHARES. Sales of Shares through you will be at the public
offering price of such Shares (the net asset value of the Shares plus any sales
charge applicable to such Shares ("Sales Charge")), as determined in accordance
with the then effective prospectus or statement of additional information used
in connection with the offer and sale of Shares (collectively, the
"Prospectus"), which public offering price may reflect scheduled variations in,
or the elimination of, the Sales Charge on sales of the Shares either generally
to the public or in connection with special purchase plans, as described in the
Prospectus. You agree that you will apply any scheduled variation in, or
elimination of, the Sales Charge uniformly to all offerees in the class
specified in the Prospectus.
2. ORDERS. (a) You agree to purchase Shares solely through us and only
for the purpose of covering purchase orders already received from customers or
for your own bona fide investment. You also agree not to withhold any customer
order so as to profit therefrom.
(b) The procedures relating to the handling of orders shall be subject
to instructions which we will forward from time to time to all selected dealers
with whom we have entered into Selected Dealer Agreements. The minimum initial
order for each Fund shall be specified in the Fund's then current Prospectus.
All purchase orders are subject to acceptance of such orders by us. We and the
applicable Funds reserve the right in our sole discretion to reject any order or
to suspend the offering of Shares.
(c) You shall be solely responsible for the accuracy, timeliness and
completeness of any orders transmitted by you on behalf of your customers by
wire or telephone for purchases, exchanges or redemptions, and shall indemnify
us against any claims by your customers as a
result of your failure to properly transmit their instructions. You are also
solely responsible for ensuring that orders are placed only by properly
authorized persons.
3. TRANSACTIONS IN SHARES. (a) You agree that your transactions in
Shares of the Funds will be limited to (i) the purchase of Shares from us for
resale to your customers at the public offering price then in effect or for your
own bona fide investment, (ii) exchanges of Shares between Funds, as permitted
by the Funds' then current Prospectuses and in accordance with procedures as
they may be modified by us from time to time, and (iii) transactions involving
the redemption of Shares by a Fund. Redemptions by a Fund will be effected in
the manner and upon the terms described in the Prospectus and pursuant to any
procedures that we provide to you from time to time. We will, upon your request,
assist you in processing such orders for redemptions.
(b) You have entered into a separate written agreement to facilitate the
transmission of information regarding customer accounts through the NETWORKING
system of the National Securities Clearing Corporation ("NSCC"). You agree that
each such account will be maintained through the NSCC's NETWORKING system at
matrix level 3.
(c) If you are a Bank, with respect to any and all transactions in
Shares of the Funds 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; and (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.
4. OFFERING PRICE. We shall accept orders only on the basis of the then
current offering price. You agree to place orders in respect of Shares
immediately upon the receipt of orders from your customers for the same number
of Shares. Orders which you receive from your customers prior to the time at
which the applicable Fund prices its shares shall be deemed received by us at
that time if transmitted to us in accordance with procedures that we provide to
you from time to time. We will not accept from you a conditional order on any
basis. All orders shall be subject to confirmation by us.
5. SUITABILITY AND MULTIPLE CLASSES OF SHARES. (a) The Funds are
generally offered in more than one class of Shares in accordance with each
Fund's Prospectus. You are responsible for determining whether a Fund is
suitable for your client and also for determining which class of that Fund's
shares is suitable for your client. Certain investors that are affiliated with
us and their families may have special purchase rights. Certain classes of
Shares may be available only to certain groups of purchasers. Information
concerning the availability of each class of Shares is found in the currently
effective Prospectus for each Fund.
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(b) 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.
6. SHAREHOLDER COMMUNICATIONS. You agree to furnish the following
shareholder communications material to your customers after receipt from us of
sufficient quantities to allow mailing thereof to all of your customers who are
beneficial owners of any Shares: (a) a prospectus prior to or at the time such
customer purchases Shares; (b) for any customer who so requests, a copy of the
statement of additional information within the time dictated by regulatory
requirements; (c) all proxy or information statements prepared for circulation
to shareholders of record; (d) annual and semi-annual reports of the Funds; and
(e) all updated prospectuses, supplements, and amendments thereto. It is your
obligation to ensure that all such information and materials are distributed to
your customers who purchase or own Shares, in accordance with securities (and,
if applicable, banking) laws, rules and regulations.
7. COMPENSATION. (a) Any sales charges and commissions will be as set
forth in the current Prospectus of each Fund and on Schedule B attached hereto
or as might otherwise be agreed to in writing by the parties.
(b) Where payment is due hereunder, we agree to send payment for
commissions and service fees to your address as it appears on our records. You
must notify us of address changes and promptly negotiate any disagreements with
respect to such payments. Any such payments that remain outstanding for 12
months shall be void and the obligation represented thereby shall be
extinguished.
(c) With respect to shares of Funds that impose a contingent deferred
sales charge ("CDSC"), we agree to compensate you at a specified rate as
disclosed in Schedule B only on purchase payments for those that are subject to
a CDSC at the time of investment. You understand that we are entitled to retain
any CDSC deducted from redemption proceeds.
(d) We reserve the right to modify all CDSC waivers at any time. We will
promptly notify you of any modification thereto. We reserve the right to reclaim
any commission payment from you if we determine that a CDSC waiver applied at
the time of payment.
(e) You are responsible for applying the correct sales charge to your
customers, as detailed in the current Prospectus for each Fund attached hereto
or as might otherwise be agreed to in writing by the parties.
(f) There are no sales charges or commissions payable on the
reinvestment of dividends and distributions.
(g) You agree that you will not combine customer orders to reach
breakpoints in commissions for any purpose whatsoever unless authorized by the
Prospectus or by us in writing.
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8. SETTLEMENT. Unless otherwise agreed, settlement shall be made at the
offices of the Funds' transfer agent within three (3) business days after our
acceptance of the order. If payment is not so received within ten (10) business
days of our acceptance of the order, we reserve the right to cancel the sale or,
at our option, to sell the Shares to the applicable Funds at the then prevailing
net asset value. In this event, or in the event that you cancel the trade for
any reason, you agree to be responsible for any loss resulting to the Funds or
to us from your failure to make payments as aforesaid. You shall not be entitled
to any gains generated thereby.
9. SUSPENSION OF SALES; AMENDMENTS TO SCHEDULES. We reserve the right
in our discretion without notice to you to suspend sales or withdraw any
offering of Shares entirely, to change the offering prices as provided in the
Prospectus or, upon notice to you, to amend or cancel the Schedules to this
Agreement. You agree that any order to purchase Shares placed by you, after
notice of any amendment to the Schedules to this Agreement has been sent to you,
shall constitute your agreement to any such amendment.
10. NO AGENCY. You have no authority whatsoever to act as our agent or,
except as noted below, as agent for the Funds, any other Selected Dealer or the
Funds' transfer agent and nothing in this Agreement shall serve to appoint you
as an agent of any of the foregoing in connection with transactions with your
customers or otherwise. Notwithstanding the foregoing, you may act as agent on
behalf of the Funds for the limited purpose of receiving orders from your
customers for the purchase or redemption of Fund shares. In that event, the time
of receipt of a customer order for purposes of rule 22c-1 under the Investment
Company Act will be the time you accept the order.
11. REPRESENTATIONS CONCERNING FUNDS; LIABILITY. No person is authorized
to make any representations concerning the Funds or their Shares except those
contained in the relevant Prospectus and any such information as may be released
by us as information supplemental to the Prospectus. Further, no advertising or
sales literature, as such terms are defined by the NASD, of any kind whatsoever
will be used by you with respect to the Funds or us unless first provided to you
by us or unless you have obtained our prior written approval. If you should make
any such unauthorized representation, you agree to indemnify the Funds and us
from and against any and all claims, liability, expense or loss in any way
arising out of or in any way connected with such representation.
12. WARRANTIES. You make the following representations and warranties
and agree to indemnify and hold us, and each Fund, harmless against every loss,
cost, damage or expense (including reasonable attorney's fees and expenses)
incurred by us as a result of your breach of such representations and
warranties:
(a) You are either (i) registered as a broker-dealer under the 1934 Act,
and are licensed and qualified as a broker-dealer or otherwise authorized to
offer and sell Shares under the laws of the jurisdictions in which the Shares
will be offered and sold by you or (ii) you are a Bank;
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(b) If you are registered as a broker-dealer under the 1934 Act, you are
a member in good standing with the NASD and agree to maintain such membership in
good standing;
(c) In selling Shares you will comply with all applicable laws, rules
and regulations, including the applicable provisions of the Securities Act of
1933, as amended, the 1934 Act, and the 1940 Act, the applicable rules and
regulations of the NASD, any applicable banking laws, rules and regulations, and
the applicable rules and regulations of the jurisdictions in which you sell any
Shares directly or indirectly;
(d) You will offer to sell Shares only to purchasers meeting the
applicable eligibility requirements set forth in the Prospectus;
(e) You agree not to offer for sale or sell Shares in any jurisdictions
in which Shares are not qualified for sale or in which you are not qualified
under the laws, rules and regulations of the jurisdiction to sell the Shares. We
will inform you as to the states in which shares of the Funds have been
qualified for sale under, or are exempt from the requirements of, applicable
state securities laws;
(f) If you are a Bank, you are not in violation of any banking law, rule
or regulations as to which you are subject and that the transactions
contemplated by this Agreement will not result in any violations of any banking
law, rule or regulation; and
(g) If you are a Bank, you will not make shares of any Fund available to
your customers, including your fiduciary customers, or accept any fees or
compensation hereunder except in compliance with all federal and state laws,
rules and regulations of regulatory agencies or authorities 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.
13. INDEMNIFICATION. (a) We will indemnify and hold harmless you, each
of your directors, officers, employees, and agents, and each person who is or
may be deemed to be controlling, controlled by or under common control with you,
from and against any and all direct and indirect claims, damages, losses,
liabilities, or expenses (including the reasonable costs of investigation and
reasonable attorney's fees) resulting from (i) our willful misconduct or
negligence, or that of our agents and employees, as measured by industry
standards, in the performance of, or failure to perform, our obligations under
this Agreement; (ii) any violation of any law, rule, or regulation relating to
the registration or qualification of shares of a Fund; or (iii) any untrue
statement, or alleged untrue statement, of a material fact contained in any
Fund's registration statement or any offering documents, sales literature, or
marketing materials that we, a Fund or any of our affiliates provide to you, or
any omission, or alleged omission, to state a material fact required to be
stated therein or necessary to make the statements therein not misleading;
PROVIDED, HOWEVER, that we will not be liable for indemnification hereunder to
the extent that any claim, damage, loss, liability, or expense results from the
willful misconduct or negligence, as measured by industry standards, of you or
your affiliates. Such right of indemnification will survive the termination of
this Agreement.
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(b) You will indemnify and hold harmless us, each of our directors,
officers, employees, and agents, and each person who is or may be deemed to be
controlling, controlled by or under common control with us, from and against any
and all direct and indirect claims, damages, losses, liabilities, or expenses
(including the reasonable costs of investigation and reasonable attorney's fees)
resulting from (i) your willful misconduct or negligence, as measured by
industry standards, and that of your agents and employees, in the performance
of, or failure to perform, your obligations under this Agreement; or (ii) any
untrue statement, or alleged untrue statement, of a material fact contained in
offering documents, sales literature, or marketing materials that you or any of
your affiliates produce and provide to customers, or any omission, or alleged
omission in such documents, to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; PROVIDED,
HOWEVER, that you will not be liable for indemnification hereunder to the extent
that any claim, damage, loss, liability, or expense results from the willful
misconduct or negligence, as measured by industry standards, of us or our
affiliates. This right of indemnification will survive the termination of this
Agreement.
(c) If any action, suit, or proceeding is initiated against any party
indemnified hereunder ("Indemnified Party") with respect to which such party
intends to seek indemnification, the Indemnified Party will notify the other
party ("Indemnifying Party") of such action, suit, or proceeding promptly after
service of the summons or other first legal process. Such notice will be given
by a means of prompt delivery that provides confirmation of receipt to the
address detailed below under Section 17. The failure of the Indemnified Party so
to notify the Indemnifying Party will relieve the Indemnifying Party of its
indemnity obligation with respect to that action, suit, or proceeding to the
extent that such omission results in the forfeiture of substantive rights or
defenses by the Indemnifying Party; failure to give prompt notice will not
relieve the Indemnifying Party of any liability that it otherwise may have to
the Indemnified Party. The Indemnifying Party will be entitled to assume the
defense of such action, suit, or proceeding. If the Indemnifying Party elects to
assume the defense thereof and retains counsel, the Indemnified Party will bear
the fees and expenses of any additional counsel retained by it, unless (1) the
employment of counsel by the Indemnified Party has been authorized in writing by
the Indemnifying Party, (2) the Indemnified Party has reasonably concluded that
there may be legal defenses available to it or other Indemnified Parties that
are different from, or in addition to those available to the Indemnifying Party
(in which case the Indemnifying Party will not have the right to direct the
defense of such action on behalf of the Indemnified Party) or (3) the
Indemnifying Party has not in fact employed counsel to assume the defense of
such action within a reasonable time after receiving notice of the commencement
of the action, in each of which cases the reasonable fees and expenses of
counsel will be at the expense of the Indemnifying Party or Parties. All such
fees and expenses will be reimbursed promptly as they are incurred. An
Indemnifying Party will not be liable for any settlement of any action or claim
effected without its written consent, or, in connection with any proceeding or
related proceeding in the same jurisdiction, for the fees and expenses of more
than one separate counsel for all indemnified parties, except to the extent
provided herein. The Indemnifying Party will keep the Indemnified Party informed
of all material developments and events relating to such action, suit, or
proceeding. If the Indemnifying Party does not elect to assume the defense, the
Indemnifying Party will reimburse the Indemnified Party for the reasonable fees
and expenses of any counsel
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retained by it, which fees and expenses will be payable to the Indemnified Party
at such intervals as the parties may determine or upon the Indemnifying Party's
receipt of a xxxx related thereto.
14. EXPENSES. All expenses incurred in connection with your activities
under this Agreement shall be borne by you.
15. TERMINATION; ASSIGNMENT. This Agreement will continue in effect
unless terminated as provided herein. A party may terminate this Agreement
without cause by giving the other party thirty (30) days' written notice of its
intention to terminate. Your expulsion from the NASD will automatically
terminate this Agreement without notice. Your suspension from the NASD or a
violation by you of applicable state and federal laws and rules and regulations
of authorized regulatory agencies will terminate this Agreement effective upon
notice received by you from us. This Agreement shall not be assignable by either
party without the advance written consent of the other party, and your
assignment without such consent shall result in the termination of this
Agreement upon notice received by you from us. Failure of any party to terminate
the Agreement for any of the causes set forth in this Agreement will not
constitute a waiver of that party's right to terminate this Agreement at a later
time for any of these causes.
16. CHOICE OF LAW; ARBITRATION. This Agreement shall be construed in
accordance with the laws of the State of New York. In the event of a dispute
with respect to this Agreement that the parties are unable to resolve
themselves, such dispute will be settled by arbitration before arbitrators
sitting in the Borough of Manhattan, New York, New York in accordance with the
then existing NASD Code of Arbitration Procedure ("NASD Code"). The arbitrators
will act by majority decision, and their award may allocate attorneys' fees and
arbitration costs between the parties. Their award will be final and binding
between the parties, and such award may be entered as a judgment in any court of
competent jurisdiction. The parties agree that, to the extent permitted by the
NASD Code, the arbitrators will be selected from the securities industry.
17. NOTICES. Any notice to you or to us shall be duly given if mailed or
telefaxed to the respective addresses set forth below:
Xxxxxxx Advisors, Inc. [Name of Selected Dealer]
00 Xxxx 00xx Xxxxxx [Xxxxxxx]
Xxx Xxxx, XX 00000-0000 [Attn: ]
Attn: ___________________
18. SEVERABILITY. Should any provision of this Agreement be held
unenforceable, those provisions not affected by the determination of
unenforceability shall remain in full force and effect.
19. COMPLETE AGREEMENT. This Agreement constitutes the entire agreement
between the undersigned and supersedes all prior oral or written agreements
between the parties hereto.
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IN WITNESS WHEREOF, this Agreement has been executed as of the date set
forth above by a duly authorized representative of the parties hereto.
XXXXXXX ADVISORS, INC.
Date: By:
-------------------------- ------------------------------------
The undersigned accepts your invitation to become a Selected Dealer and
agrees to abide by the foregoing terms and conditions.
[NAME OF SELECTED DEALER]
Date: By:
-------------------------- ------------------------------------
Signature
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Print Name Title
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Address
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City State Zip
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SCHEDULE A
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LIST OF FUNDS
SCHEDULE B
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COMMISSION AND SERVICE FEE INFORMATION
CLASS A SHARES
Commission: Discount to Selected Dealers as set forth in each Fund's current
Prospectus. No commission will be paid on sales of Class A Shares without a
sales charge, except as indicated in the Prospectus for sales of $1 million or
more.
Service Fees: 0.25% per annum based on the daily net assets of the Shares
[beginning in the __ quarter of year __ after the Share purchase] for services
provided to shareholders and/or the maintenance of shareholder accounts. These
amounts will be paid to you only as and to the extent that we receive the
payments from the applicable Funds. [Add minimum aggregate amount before
payments start?]
CLASS B SHARES
Commission: Marketing Fee of __% on sales of Shares.
Service Fees: 0.25% per annum based on the daily net assets of the Shares
[beginning in the __ quarter of year __ after the Share purchase] for services
provided to shareholders and/or the maintenance of shareholder accounts. These
amounts will be paid to you only as and to the extent that we receive the
payments from the applicable Funds. [Add minimum aggregate amount before
payments start?]
CLASS C SHARES
Commission: Marketing Fee of __% on sales of Shares.
Service Fees: 0.25% per annum based on the daily net assets of the Shares
[beginning in the __ quarter of year __ after the Share purchase] for services
provided to shareholders and/or the maintenance of shareholder accounts. These
amounts will be paid to you only as and to the extent that we receive the
payments from the applicable Funds. [Add minimum aggregate amount before
payments start?]
CLASS Y SHARES
[Add description of compensation for Class Y Shares fees.]
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