PRUDENTIAL MUTUAL FUND DISTRIBUTORS, INC.
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Selected Dealer Agreement
, 199__
[Name and Address
of Selected Dealer]
Dear Sirs:
As the principal distributor of shares of certain investment companies
presently or hereafter managed by Prudential Mutual Fund Management, Inc.,
shares of which companies are distributed by us at their respective net asset
values plus sales charges, if any, pursuant to our Distribution Agreements with
such companies (the Funds), we invite you to participate as a selected dealer in
the distribution of shares of any and all of the Funds upon the following terms
and conditions:
1. You are to offer and sell such shares only at the public offering
prices which shall be currently in effect, in accordance with the terms of the
then current prospectuses of the Funds. You agree to act only as principal in
such transactions and shall not have authority to act as agent for the Funds,
for us, or for any other dealer in any respect. All orders are subject to
acceptance by us and become effective only upon confirmation by us.
2. On each purchase of shares by you from us, the total sales charges and
discount, if any, to selected dealers shall be as stated in each Fund's then
current prospectus.
Such sales charges and discount to selected dealers are subject to
reductions under a variety of circumstances as described in each Fund's then
current prospectus. To obtain these reductions, we must be notified when the
sale takes place which would qualify for the reduced charge.
There is no sales charge or discount to selected dealers on the
reinvestment of dividends.
3. As a selected dealer, you are hereby authorized (i) to place orders
directly with the Funds for their shares to be resold by us to you subject to
the applicable terms and conditions governing the placement of orders by us set
forth in the Distribution Agreement between each Fund and us and subject to the
applicable compensation provisions set forth in each Fund's then current
prospectus and (ii) to tender shares directly to the Funds or their agent for
redemption subject to the applicable terms and conditions set forth in the
Distribution Agreement.
4. Repurchases of shares will be made at the net asset value of such
shares in accordance with the then current prospectuses of the Funds.
5. You represent that you are a member of the National Association of
Securities Dealers, Inc. and that you agree to abide by the Rules of Fair
Practice of such Association.
6. This Agreement is in all respects subject to Section 26 of the Rules of
Fair Practice of the National Association of Securities Dealers, Inc. which
shall control any provisions to the contrary in this Agreement.
7. You agree:
(a) To purchase shares only from us or only from your customers.
(b) To purchase shares from us only for the purpose of covering purchase
orders already received or for your own bona fide investment.
(c) That you will not purchase any shares from your customers at prices
lower than the redemption or repurchase prices then quoted by the
Fund. You shall, however, be permitted to sell shares for the
account of their record owners to the Funds at the repurchase prices
currently established for such shares and may charge the owner a
fair commission for handling the transaction.
(d) That you will not withhold placing customers' orders for shares so
as to profit yourself as a result of such withholding.
(e) That if any shares confirmed to you hereunder are redeemed or
repurchased by any of the Funds within seven days after such
confirmation of your original order, you shall forthwith refund to
us the full discount, if any, allowed to you on such sales. We shall
forthwith pay to the appropriate Fund our share of the sales charge,
if any, on the original sale, and shall also pay to such Fund the
refund from you as herein provided. Termination or cancellation of
this Agreement shall not relieve you us from the requirements of
this subparagraph.
8. We shall not accept from you any conditional orders for shares.
Delivery of certificates, if any, for shares purchased shall be made by the
Funds only against receipt of the purchase price, subject to deduction for the
discount reallowed to you and our portion of the sales charge on such sale, if
any. If payment for the shares purchased is not received within the time
customary for such payments, the sale may be cancelled forthwith without any
responsibility or liability on our part or on the part of the Funds (in which
case you will be responsible for any loss, including loss of profit, suffered by
the Funds resulting from your failure to make payments
2
as aforesaid), or, at our option, we may sell the shares ordered back to the
Funds (in which case we may hold you responsible for any loss, including loss of
profit suffered by us resulting from your failure to make payment as aforesaid).
9. You will not offer or sell any of the shares except under circumstances
that will result in compliance with the applicable Federal and state securities
laws and 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 applicable then
current prospectus. We shall be under no liability to you except for lack of
good faith and for obligations expressly assumed by us herein. Nothing herein
contained, however, shall be deemed to be a condition, stipulation or provision
binding any persons acquiring any security to waive compliance with any
provision of the Securities Act of 1933, or of the Rules and Regulations of the
Securities and Exchange Commission or to relieve the parties hereto from any
liability arising under the Securities Act of 1933.
10. From time to time during the term of this Agreement we may (but are
not hereby obliged to) make payments to you pursuant to one or more of the
distribution plans adopted by certain of the Funds pursuant to Rule 12b-1 under
the Investment Company Act of 1940 (the Act), in consideration of your
furnishing distribution services hereunder with respect to each such Fund. Any
such payments made pursuant to this Section 10 shall be subject to the following
terms and conditions:
(a) Any such payments shall be in such amounts as we may from time to
time advise you in writing but in any event not in excess of the
amounts permitted by the plan in effect with respect to each
particular Fund. Any such payments shall be in addition to the
selling concession, if any, allowed to you pursuant to this
Agreement.
(b) The provisions of this Section 10 relate to the plan adopted by a
particular Fund pursuant to Rule 12b-1. In accordance with Rule
12b-1, any person authorized to direct the disposition of monies
paid or payable by a Fund pursuant to this Section 10 shall provide
the Fund's Board of Directors or Trustees, and the Directors or
Trustees shall review, at least quarterly, a written report of the
amounts so expended and the purposes for which such expenditures
were made.
(c) The provisions of this Section 10 applicable to each Fund shall
remain in effect for not more than a year and thereafter for
successive annual periods only so long as such continuance is
specifically approved at least annually in conformity with Rule
12b-1 and the Act. The provisions of this Section 10 shall
automatically terminate with respect to a particular plan in the
event of the assignment (as define by the Act) of this Agreement, in
the event such plan terminates or is not continued or in the event
this Agreement terminates or ceases to remain in effect. In
addition, the
3
provisions of this Section 10 may be terminated at any time, without
penalty, by either party with respect to any particular plan on not
more than 60 days' nor less than 30 days' written notice delivered
or mailed by registered mail, postage prepaid, to the other party.
11. No person is authorized to make any representations concerning shares
of the Funds except those contained in the current prospectus and printed
information issued by each Fund or by us as information supplemental to each
prospectus. We shall supply prospectuses, reasonable quantities of supplemental
sales literature, sales bulletins, and additional information as issued. You
agree not to use other advertising or sales material relating to the Funds,
unless approved in writing by us in advance of such use. Any printed information
furnished by us other than the then current prospectus and statement of
additional information for each Fund, periodic reports and proxy solicitation
materials are our sole responsibility and not the responsibility of the Funds,
and you agree that the Funds shall have no liability or responsibility to you in
these respects unless expressly assumed in connection therewith.
12. Either party to this Agreement may cancel this Agreement by giving
written notice to the other. Such notice shall be deemed to have been given on
the date on which it was either delivered personally to the other party or any
officer or partner thereof, or was mailed postpaid or delivered to a telegraph
office for transmission to the other party at his or its address as shown below.
This Agreement may be amended by us at any time and your placing of an order
after the effective date of any such amendment shall constitute your acceptance
thereof.
4
13. This Agreement shall be construed in accordance with the laws of the
State of New York and shall be binding upon both parties hereto when signed by
us and accepted by you in the space provided below.
Very truly yours,
PRUDENTIAL MUTUAL FUND
DISTRIBUTORS, INC.
By:______________________________________
Firm Name_______________________________________________________________________
Address_________________________________________________________________________
City____________________________ State____________ Zip Code_____________________
ACCEPTED BY (signature)_________________________________________________________
Name (print)________________________________ Title______________________________
Date__________________________ 19__ Phone #_____________________________________
Please return two signed copies of this Agreement (one of
which will be signed above by us and thereafter returned to
you) in the accompanying return envelope to:
Prudential Mutual Fund Distributors, Inc.
Xxx Xxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
5
