Exhibit 5(d)
CLASS D SHARES
DISTRIBUTION AGREEMENT
AGREEMENT made as of the ___ day of _____, 2000, between THE ASSET PROGRAM,
INC., a Maryland corporation (the "Program"), and PRINCETON FUNDS DISTRIBUTOR,
INC., a Delaware corporation (the "Distributor").
W I T N E S S E T H :
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WHEREAS, the Program is registered under the Investment Company Act of
1940, as amended (the "Investment Company Act"), as an open-end investment
company, and it is affirmatively in the interest of the Program to offer its
shares for sale continuously; and
WHEREAS, the Directors of the Program (the "Directors") are authorized to
establish separate series (the "Series") of the Program relating to separate
portfolios of securities, each of which will offer separate classes of shares of
common stock, par value $0.10 per share (collectively referred to as "shares");
and
WHEREAS, the Directors have established and designated the Xxxxxxx Xxxxx
Mid Cap Value Fund (the "Fund") as a series of the Program; and
WHEREAS, the Distributor is a securities firm engaged in the business of
selling shares of investment companies either directly to purchasers or through
other securities dealers; and
WHEREAS, the Program and the Distributor wish to enter into an agreement
with each other with respect to the continuous offering of the Class D shares of
common stock in the Fund.
NOW, THEREFORE, the parties agree as follows:
Section 1. Appointment of the Distributor. The Program hereby appoints
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the Distributor as the principal underwriter and distributor of the Program to
sell Class D shares of common stock in the Fund (sometimes herein referred to as
"Class D shares") to the public and hereby agrees during the term of this
Agreement to sell Class D shares of the Fund to the Distributor upon the terms
and conditions herein set forth.
Section 2. Exclusive Nature of Duties. The Distributor shall be the
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exclusive representative of the Program to act as principal underwriter and
distributor of the Class D shares of the Fund, except that:
(a) The Program may, upon written notice to the Distributor, from time to
time designate other principal underwriters and distributors of Class D shares
with respect to areas other than the United States as to which the Distributor
may have expressly waived in writing its right to act as such. If such
designation is deemed exclusive, the right of the Distributor under this
Agreement to sell Class D shares in the areas so designated shall terminate, but
this Agreement shall remain otherwise in full effect until terminated in
accordance with the other provisions hereof.
(b) The exclusive right granted to the Distributor to purchase Class D
shares from the Program shall not apply to Class D shares issued in connection
with the merger or consolidation of any other investment company or personal
holding company with the Program or the acquisition by purchase or otherwise of
all (or substantially all) the assets or the outstanding Class D shares of any
such company by the Program.
(c) Such exclusive right also shall not apply to Class D shares issued
pursuant to reinvestment of dividends or capital gains distributions.
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(d) Such exclusive right also shall not apply to Class D shares issued
pursuant to any conversion, exchange or reinstatement privilege afforded
redeeming shareholders or to any other Class D shares as shall be agreed between
the Program and the Distributor from time to time.
Section 3. Purchase of Class D Shares from the Program.
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(a) The Distributor shall have the right to buy from the Program the Class D
shares needed, but not more than the Class D shares needed (except for clerical
errors in transmission) to fill unconditional orders for Class D shares of the
Fund placed with the Distributor by eligible investors or securities dealers.
Investors eligible to purchase Class D shares shall be those persons so
identified in the currently effective prospectus and statement of additional
information relating to the Fund (the "prospectus" and "statement of additional
information", respectively) under the Securities Act of 1933, as amended (the
"Securities Act"), relating to such Class D shares. The price which the
Distributor shall pay for the Class D shares so purchased from the Program shall
be the net asset value, determined as set forth in Section 3(d) hereof, used in
determining the public offering price on which such orders were based.
(b) The Class D shares are to be resold by the Distributor to investors at
the public offering price, as set forth in Section 3(c) hereof, or to securities
dealers having agreements with the Distributor upon the terms and conditions
set forth in Section 7 hereof.
(c) The public offering price(s) of the Class D shares, i.e., the price
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per share at which the Distributor or selected dealers may sell Class D shares
to the public, shall be the public offering price as set forth in the prospectus
and statement of additional information relating to such Class D shares, but not
to exceed the net asset value at which the Distributor is to purchase the Class
D shares, plus a sales charge not to exceed 5.25% of the public offering price
(5.54%
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of the net amount invested), subject to reductions for volume purchases. Class D
shares may be sold to certain Directors, officers and employees of the Program,
directors and employees of Xxxxxxx Xxxxx & Co., Inc. and its subsidiaries, and
to certain other persons described in the prospectus and statement of additional
information, without a sales charge or at a reduced sales charge, upon terms and
conditions set forth in the prospectus and statement of additional information.
If the public offering price does not equal an even cent, the public offering
price may be adjusted to the nearest cent. All payments to the Program hereunder
shall be made in the manner set forth in Section 3(f).
(d) The net asset value of Class D shares shall be determined by the
Program or any agent of the Program in accordance with the method set forth in
the prospectus and statement of additional information and guidelines
established by the Directors.
(e) The Program shall have the right to suspend the sale of its Class D
shares at times when redemption is suspended pursuant to the conditions set
forth in Section 4(b) hereof. The Program shall also have the right to suspend
the sale of its Class D shares if trading on the New York Stock Exchange shall
have been suspended, if a banking moratorium shall have been declared by Federal
or New York authorities, or if there shall have been some other event, which, in
the judgment of the Program, makes it impracticable or inadvisable to sell the
Class D shares.
(f) The Program, or any agent of the Program designated in writing by the
Program, shall be promptly advised of all purchase orders for Class D shares
received by the Distributor. Any order may be rejected by the Program;
provided, however, that the Program will not arbitrarily or without reasonable
cause refuse to accept or confirm orders for the purchase of Class D shares.
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The Program (or its agent) will confirm orders upon their receipt, will make
appropriate book entries and, upon receipt by the Program (or its agent) of
payment therefor, will deliver deposit receipts or certificates for such Class D
shares pursuant to the instructions of the Distributor. Payment shall be made
to the Program in New York Clearing House funds. The Distributor agrees to
cause such payment and such instructions to be delivered promptly to the Program
(or its agent).
Section 4. Repurchase or Redemption of Class D Shares by the Program.
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(a) Any of the outstanding Class D shares may be tendered for redemption
at any time, and the Program agrees to repurchase or redeem the Class D shares
so tendered in accordance with its obligations as set forth in Article VI of its
Articles of Incorporation, as amended from time to time, and in accordance with
the applicable provisions set forth in the prospectus and statement of
additional information. The price to be paid to redeem or repurchase the Class
D shares shall be equal to the net asset value calculated in accordance with the
provisions of Section 3(d) hereof, less any contingent deferred sales charge
("CDSC"), redemption fee or other charge(s), if any, set forth in the prospectus
and statement of additional information relating to the Fund. All payments by
the Program hereunder shall be made in the manner set forth below. The
redemption or repurchase by the Program of any of the Class D shares purchased
by or through the Distributor will not affect the sales charge secured by the
Distributor or any selected dealer in the course of the original sale, except
that if any Class D shares are tendered for redemption or repurchase within
seven business days after the date of the confirmation of the original purchase,
the right to the sales charge shall be forfeited by the Distributor and the
selected dealer which sold such Class D shares.
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The Program shall pay the total amount of the redemption price as defined
in the above paragraph pursuant to the instructions of the Distributor in New
York Clearing House funds on or before the seventh business day subsequent to
its having received the notice of redemption in proper form. The proceeds of
any redemption of shares shall be paid by the Program as follows: (i) any
applicable CDSC shall be paid to the Distributor, and (ii) the balance shall be
paid to or for the account of the shareholder, in each case in accordance with
the applicable provisions of the prospectus and statement of additional
information.
(b) Redemption of Class D shares or payment may be suspended at times when
the New York Stock Exchange is closed, when trading on said Exchange is
suspended, when trading on said Exchange is restricted, when an emergency exists
as a result of which disposal by the Program of securities owned by it is not
reasonably practicable or it is not reasonably practicable for the Program
fairly to determine the value of the net assets of the Fund, or during any other
period when the Securities and Exchange Commission, by order, so permits.
Section 5. Duties of the Program.
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(a) The Program shall furnish to the Distributor copies of all
information, financial statements and other papers which the Distributor may
reasonably request for use in connection with the distribution of Class D shares
of the Fund, and this shall include, upon request by the Distributor, one
certified copy of all financial statements prepared for the Program by
independent public accountants. The Program shall make available to the
Distributor such number of copies of the prospectus and statement of additional
information relating to the Fund as the Distributor shall reasonably request.
6
(b) The Program shall take, from time to time, but subject to any
necessary approval of the Class D shareholders, all necessary action to fix the
number of authorized Class D shares and such steps as may be necessary to
register the same under the Securities Act, to the end that there will be
available for sale such number of Class D shares as the Distributor may
reasonably be expected to sell.
(c) The Program shall use its best efforts to qualify and maintain the
qualification of an appropriate number of its Class D shares for sale under the
securities laws of such states as the Distributor and the Program may approve.
Any such qualification may be withheld, terminated or withdrawn by the Program
at any time in its discretion. As provided in Section 8(c) hereof, the expense
of qualification and maintenance of qualification shall be borne by the Program.
The Distributor shall furnish such information and other material relating to
its affairs and activities as may be required by the Program in connection with
such qualification.
(d) The Program will furnish, in reasonable quantities upon request by the
Distributor, copies of annual and interim reports of the Program relating to the
Fund.
Section 6. Duties of the Distributor.
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(a) The Distributor shall devote reasonable time and effort to effect
sales of Class D shares of the Fund but shall not be obligated to sell any
specific number of Class D shares. The services of the Distributor to the
Program hereunder are not to be deemed exclusive and nothing herein contained
shall prevent the Distributor from entering into like arrangements with other
investment companies so long as the performance of its obligations hereunder is
not impaired thereby.
7
(b) In selling the Class D shares of the Fund, the Distributor shall use
its best efforts in all respects duly to conform with the requirements of all
Federal and state laws relating to the sale of such securities. Neither the
Distributor nor any selected dealer, as defined in Section 7 hereof, nor any
other person is authorized by the Program to give any information or to make any
representations, other than those contained in the registration statement or
related prospectus and statement of additional information and any sales
literature specifically approved by the Program.
(c) The Distributor shall adopt and follow procedures, as approved by the
officers of the Program, for the confirmation of sales to investors and selected
dealers, the collection of amounts payable by investors and selected dealers on
such sales, and the cancellation of unsettled transactions, as may be necessary
to comply with the requirements of the National Association of Securities
Dealers, Inc. (the "NASD"), as such requirements may from time to time exist.
Section 7. Selected Dealers Agreements.
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(a) The Distributor shall have the right to enter into selected dealers
agreements with securities dealers of its choice ("selected dealers") for the
sale of Class D shares and fix therein the portion of the sales charge which may
be allocated to the selected dealers; provided that the Program shall approve
the forms of agreements with dealers and the dealer compensation set forth
therein. Class D shares sold to selected dealers shall be for resale by such
dealers only at the public offering price(s) set forth in the prospectus and
statement of additional information. The form of agreement with selected
dealers to be used during the continuous offering of the Class D shares is
attached hereto as Exhibit A.
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(b) Within the United States, the Distributor shall offer and sell Class D
shares only to such selected dealers as are members in good standing of the
NASD.
Section 8. Payment of Expenses.
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(a) The Program shall bear all costs and expenses of the Fund, including
fees and disbursements of its counsel and auditors, in connection with the
preparation and filing of any required registration statements and/or
prospectuses and statements of additional information under the Investment
Company Act, the Securities Act, and all amendments and supplements thereto, and
preparing and mailing annual and interim reports and proxy materials to Class D
shareholders (including but not limited to the expense of setting in type any
such registration statements, prospectuses, statements of additional
information, annual or interim reports or proxy materials).
(b) The Distributor shall be responsible for any payments made to selected
dealers as reimbursement for their expenses associated with payments of sales
commissions to financial consultants. In addition, after the prospectuses,
statements of additional information and annual and interim reports have been
prepared and set in type, the Distributor shall bear the costs and expenses of
printing and distributing any copies thereof which are to be used in connection
with the offering of Class D shares to selected dealers or investors pursuant to
this Agreement. The Distributor shall bear the costs and expenses of preparing,
printing and distributing any other literature used by the Distributor or
furnished by it for use by selected dealers in connection with the offering of
the Class D shares for sale to the public and any expenses of advertising
incurred by the Distributor in connection with such offering. It is understood
and agreed that so long as the Fund's Class D Shares Distribution Plan pursuant
to Rule 12b-1 under the Investment Company Act remains in effect, any expenses
incurred by the Distributor hereunder in
9
connection with account maintenance activities may be paid from amounts
recovered by it from the Fund under such plan.
(c) The Program shall bear the cost and expenses of qualification of the
Class D shares for sale pursuant to this Agreement and, if necessary or
advisable in connection therewith, of qualifying the Program as a broker or
dealer in such states of the United States or other jurisdictions as shall be
selected by the Program and the Distributor pursuant to Section 5(c) hereof and
the cost and expenses payable to each such state for continuing qualification
therein until the Program decides to discontinue such qualification pursuant to
Section 5(c) hereof.
Section 9. Indemnification.
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(a) The Program shall indemnify and hold harmless the Distributor and each
person, if any, who controls the Distributor against any loss, liability, claim,
damage or expense (including the reasonable cost of investigating or defending
any alleged loss, liability, claim, damage or expense and reasonable counsel
fees incurred in connection therewith), as incurred, arising by reason of any
person acquiring any Class D shares, which may be based upon the Securities Act,
or on any other statute or at common law, on the ground that the registration
statement or related prospectus and statement of additional information relating
to the Fund, as from time to time amended and supplemented, or an annual or
interim report to shareholders relating to the Fund, includes an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading, unless such statement or omission was made in reliance upon, and in
conformity with, information furnished to the Program in connection therewith by
or on behalf of the Distributor; provided, however, that in no case (i) is the
indemnity of the Program in favor of the Distributor and any such controlling
persons to be deemed to protect such Distributor or any such controlling persons
10
thereof against any liability to the Program or its security holders to which
the Distributor or any such controlling persons would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence in the performance
of their duties or by reason of the reckless disregard of their obligations and
duties under this Agreement; or (ii) is the Program to be liable under its
indemnity agreement contained in this paragraph with respect to any claim made
against the Distributor or any such controlling persons, unless the Distributor
or such controlling persons, as the case may be, shall have notified the Program
in writing within a reasonable time after the summons or other first legal
process giving information of the nature of the claim shall have been served
upon the Distributor or such controlling persons (or after the Distributor or
such controlling persons shall have received notice of such service on any
designated agent), but failure to notify the Program of any such claim shall not
relieve it from any liability which it may have to the person against whom such
action is brought otherwise than on account of its indemnity agreement contained
in this paragraph. The Program will be entitled to participate at its own
expense in the defense or, if it so elects, to assume the defense of any suit
brought to enforce any such liability, but if the Program elects to assume the
defense, such defense shall be conducted by counsel chosen by it and
satisfactory to the Distributor or such controlling person or persons, defendant
or defendants in the suit. In the event the Program elects to assume the
defense of any such suit and retain such counsel, the Distributor or such
controlling person or persons, defendant or defendants in the suit shall bear
the fees and expenses of any additional counsel retained by them, but in case
the Program does not elect to assume the defense of any such suit, it will
reimburse the Distributor or such controlling person or persons, defendant or
defendants in the suit, for the reasonable fees and expenses of any counsel
retained by them. The Program shall promptly notify the Distributor of the
commencement of any litigation or
11
proceedings against it or any of its officers or Directors in connection with
the issuance or sale of any of the Class D shares.
(b) The Distributor shall indemnify and hold harmless the Program and each
of its Directors and officers and each person, if any, who controls the Program
against any loss, liability, claim, damage or expense described in the foregoing
indemnity contained in subsection (a) of this Section, but only with respect to
statements or omissions made in reliance upon, and in conformity with,
information furnished to the Program in writing by or on behalf of the
Distributor for use in connection with the registration statement or related
prospectus and statement of additional information, as from time to time
amended, or the annual or interim reports to Class D shareholders. In case any
action shall be brought against the Program or any person so indemnified, in
respect of which indemnity may be sought against the Distributor, the
Distributor shall have the rights and duties given to the Program, and the
Program and each person so indemnified shall have the rights and duties given to
the Distributor by the provisions of subsection (a) of this Section 9.
Section 10. Xxxxxxx Xxxxx Mutual Fund Adviser Program. In connection with
-----------------------------------------
the Xxxxxxx Xxxxx Mutual Fund Adviser Program, the Distributor and its
affiliate, Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, are authorized to
offer and sell shares of the Fund, as agent for the Fund, to participants in
such program. The terms of this Agreement shall apply to such sales, including
terms as to the offering price of shares, the proceeds to be paid to the Fund,
the duties of the Distributor, the payment of expenses and indemnification
obligations of the Fund and the Distributor.
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Section 11. Duration and Termination of this Agreement. This Agreement
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shall become effective as of the date first above written and shall remain in
force until _____ ___, 2000, and thereafter, but only for so long as such
continuance is specifically approved at least annually by (i) the Directors or
by the vote of a majority of the outstanding Class D voting securities of the
Fund and (ii) by the vote of a majority of those Directors who are not parties
to this Agreement or interested persons of any such party cast in person at a
meeting called for the purpose of voting on such approval.
This Agreement may be terminated at any time, without the payment of any
penalty, by the Directors or by vote of a majority of the outstanding Class D
voting securities of the Fund, or by the Distributor, on sixty days' written
notice to the other party. This Agreement shall automatically terminate in the
event of its assignment.
The terms "vote of a majority of the outstanding voting securities",
"assignment", "affiliated person" and "interested person", when used in this
Agreement, shall have the respective meanings specified in the Investment
Company Act.
Section 12. Amendments of this Agreement. This Agreement may be amended
----------------------------
by the parties only if such amendment is specifically approved by (i) the
Directors or by the vote of a majority of outstanding Class D voting securities
of the Fund and (ii) by the vote of a majority of those Directors of the Program
who are not parties to this Agreement or interested persons of any such party
cast in person at a meeting called for the purpose of voting on such approval.
Section 13. Governing Law. The provisions of this Agreement shall be
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construed and interpreted in accordance with the laws of the State of New York
as at the time in effect and the applicable provisions of the Investment Company
Act. To the extent that the applicable law of
13
the State of New York, or any of the provisions herein, conflict with the
applicable provisions of the Investment Company Act, the latter shall control.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
THE ASSET PROGRAM, INC.
By_____________________________________
Title:
PRINCETON FUNDS DISTRIBUTOR, INC.
By_____________________________________
Title:
14
EXHIBIT A
THE ASSET PROGRAM, INC.
CLASS D SHARES OF COMMON STOCK
SELECTED DEALERS AGREEMENT
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Gentlemen:
Princeton Funds Distributor, Inc. (the "Distributor") has an agreement with
THE ASSET PROGRAM, INC., a Maryland corporation (the "Program"), pursuant to
which it acts as the distributor for the sale of Class D shares of common stock,
par value $0.10 per share (herein referred to as "Class D shares"), of the
Program relating to the Xxxxxxx Xxxxx Mid Cap Value Fund (the "Fund"), and as
such has the right to distribute Class D shares of the Fund for resale. The
Program is an open-end investment company registered under the Investment
Company Act of 1940, as amended, and the Fund's Class D shares being offered to
the public are registered under the Securities Act of 1933, as amended. You
have received a copy of the Class D Shares Distribution Agreement (the
"Distribution Agreement") between ourselves and the Program and reference is
made herein to certain provisions of such Distribution Agreement. The terms
"Prospectus" and "Statement of Additional Information" used herein refer to the
prospectus and statement of additional information, respectively, on file with
the Securities and Exchange Commission which is part of the most recent
effective registration statement pursuant to the Securities Act of 1933, as
amended. We offer to sell to you, as a member of the Selected Dealers Group,
Class D shares of the Fund upon the following terms and conditions:
1. In all sales of these Class D shares to the public, you shall act as
dealer for your own account and in no transaction shall you have any authority
to act as agent for the Program, for us or for any other member of the Selected
Dealers Group, except in connection with such special programs as we from time
to time agree, in which case you shall have authority to offer and sell shares,
as agent for the Program, to participants in such program.
2. Orders received from you will be accepted through us only at the public
offering price applicable to each order, as set forth in the current Prospectus
and Statement of Additional Information relating to the Fund subject in each
case to the delivery prior to or at the time of such sales of the then current
Prospectus. The procedure relating to the handling of orders shall be subject to
Section 5 hereof and instructions which we or the Program shall forward from
time to time to you. All orders are subject to acceptance or rejection by the
Distributor or the Program in the sole discretion of either and become effective
only upon confirmation by the Distributor. The minimum initial and subsequent
purchase requirements are as set forth in the current Prospectus and Statement
of Additional Information relating to the Fund no order for less than such
amounts will be accepted unless such purchase shall be expressly approved by the
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Fund in accordance with the then current Prospectus. No conditional order will
be accepted on any basis other than a definitive one.
3. The sales charges for sales to the public, computed as percentages of
the public offering price and the amount invested, and the related discount to
Selected Dealers are as follows:
Discount to
Sales Charge Selected
Sales Charge as Percentage* Dealers as
as Percentage of the Net Percentage
of the Amount of the
Amount of Purchase Offering Price Invested Offering Price
------------------ -------------- -------- --------------
Less than
$25,000...................... 5.25% 5.54% 5.00%
$25,000 but less
than $50,000................. 4.75% 4.99% 4.50%
$50,000 but less
than $100,000................ 4.00% 4.17% 3.75%
$100,000 but less
than $250,000................ 3.00% 3.09% 2.75%
$250,000 but less
than $1,000,000.............. 2.00% 2.04% 1.80%
$1,000,000 and 0.00% 0.00% 0.00%
over**.......................
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* Rounded to the nearest one-hundredth percent.
** Initial sales charges will be waived for certain classes of offerees as set
forth in the current Prospectus and Statement of Additional Information relating
to the Fund. Such purchase may be subject to a contingent deferred sales charge
as set forth in the current Prospectus and Statement of Additional Information.
The term "purchase" refers to a single purchase by an individual, or to
concurrent purchases, which in the aggregate are at least equal to the
prescribed amounts, by an individual, his spouse and their children under the
age of 21 years purchasing Class D shares for his or their own account and to
single purchases by a trustee or other fiduciary purchasing Class D shares for
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a single trust estate or single fiduciary account although more than one
beneficiary is involved. The term "purchase" also includes purchases by any
"company" as that term is defined in the Investment Company Act of 1940, as
amended, but does not include purchases by any such company which has not been
in existence for at least six months or which has no purpose other than the
purchase of Class D shares of the Fund or Class D shares of other registered
investment companies at a discount; provided, however, that it shall not include
purchases by any group of individuals whose sole organizational nexus is that
the participants therein are credit cardholders of a company, policyholders of
an insurance company, customers of either a bank or broker-dealer or clients of
an investment adviser.
The reduced sales charges are applicable through a right of accumulation
under which eligible investors are permitted to purchase Class D shares of the
Fund at the offering price applicable to the total of (a) the dollar amount then
being purchased plus (b) an amount equal to the then current net asset value or
cost, whichever is higher, of the purchaser's combined holdings of Class A,
Class B, Class C and Class D shares of the Fund and of any other series of the
Program or investment company with an initial sales charge for which the
Distributor acts as the distributor. For any such right of accumulation to be
made available, the Distributor must be provided at the time of purchase, by the
purchaser or you, with sufficient information to permit confirmation of
qualification, and acceptance of the purchase order is subject to such
confirmation.
The reduced sales charges are applicable to purchases aggregating $25,000
or more of Class A shares or of Class D shares of any other series of the
Program or investment company with an initial sales charge for which the
Distributor acts as the distributor made through you within a thirteen-month
period starting with the first purchase pursuant to a Letter of Intention. A
purchase not originally made pursuant to a Letter of Intention may be included
under a subsequent letter executed within 90 days of such purchase if the
Distributor is informed in writing of this intent within such 90-day period. If
the intended amount of shares is not purchased within the thirteen-month period,
an appropriate price adjustment will be made pursuant to the terms of the Letter
of Intention.
You agree to advise us promptly at our request as to amounts of any sales
made by you to the public qualifying for reduced sales charges. Further
information as to the reduced sales charges pursuant to the right of
accumulation or a Letter of Intention is set forth in the Prospectus and
Statement of Additional Information.
4. As an authorized agent to sell shares of the Fund, you agree to
purchase shares of the Fund only through us or from your customers. You shall
not place orders for any of the Class D shares except for your own investment
purposes or unless you have already received purchase orders for such Class D
shares at the applicable public offering prices and subject to the terms hereof
and of the Distribution Agreement. We agree that we will not place orders for
the purchase of shares from the Fund except to cover purchase orders already
received by us. You agree that you will not offer or sell any of the Class D
shares except under circumstances that
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will result in compliance with the applicable Federal and state securities laws
and that in connection with sales and offers to sell Class D shares you will
furnish to each person to whom any such sale or offer is made a copy of the
Prospectus and, if requested, the Statement of Additional Information (as then
amended or supplemented) and will not furnish to any person any information
relating to the Class D shares of the Fund which is inconsistent in any respect
with the information contained in the Prospectus and Statement of Additional
Information (as then amended or supplemented) or cause any advertisement to be
published in any newspaper or posted in any public place without our consent and
the consent of the Program.
5. As a selected dealer, you are hereby authorized (i) to place orders
directly with the Program for Class D shares of the Fund to be resold by us to
you subject to the applicable terms and conditions governing the placement of
orders by us set forth in Section 3 of the Distribution Agreement and subject to
the compensation provisions of Section 3 hereof and (ii) to tender Class D
shares directly to the Program or its agent for redemption subject to the
applicable terms and conditions set forth in Section 4 of the Distribution
Agreement.
6. You agree to place orders received from your customers as soon as
practicable after your receipt of such orders. You further agree that 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. Settlement shall be made promptly, but in case later than the time
customary for such payments after our acceptance of the order or, if so
specified by you, we will make delivery by draft on you, the amount of which
draft you agree to pay on presentation to you. If payment is not so received or
made, the right is reserved forthwith to cancel the sale or at our option to
resell the shares to the Fund at the then prevailing net asset value in which
latter case you agree to be responsible for any loss resulting to the Fund or to
us from your failure to make payment as aforesaid.
8. If any Class D shares sold to you under the terms of this Agreement are
repurchased by the Program or by us for the account of the Program or are
tendered for redemption within seven business days after the date of the
confirmation of the original purchase by you, it is agreed that you shall
forfeit your right to, and refund to us, any discount received by you on such
Class D shares.
9. No person is authorized to make any representations concerning Class D
shares of the Fund except those contained in the current Prospectus and
Statement of Additional Information relating to the Fund and in such printed
information subsequently issued by us or the Program as information supplemental
to such Prospectus and Statement of Additional Information. In purchasing Class
D shares through us you shall rely solely on the representations contained in
the Prospectus and Statement of Additional Information and supplemental
information above mentioned. Any printed information which we furnish you other
than the
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Prospectus, Statement of Additional Information, periodic reports and proxy
solicitation material of the Program relating to the Fund is our sole
responsibility and not the responsibility of the Program, and you agree that the
Program shall have no liability or responsibility to you in these respects
unless expressly assumed in connection therewith.
10. You agree to deliver to each of the purchasers making purchases from
you a copy of the then current Prospectus and, if requested, the Statement of
Additional Information at or prior to the time of offering or sale and you agree
thereafter to deliver to such purchasers copies of the annual and interim
reports and proxy solicitation materials of the Program relating to the Fund.
You further agree to endeavor to obtain proxies from such purchasers.
Additional copies of such Prospectus and Statement of Additional Information,
annual or interim reports and proxy solicitation materials will be supplied to
you in reasonable quantities upon request.
11. All sales will be subject to receipt of shares by us from the Fund.
We reserve the right in our discretion, without notice, to suspend sales or
withdraw the offering of Class D shares entirely or to certain persons or
entities in a class or classes specified by us or to modify or cancel this
Agreement.
12. We, our affiliates and the Fund (and its officers and directors) shall
not be liable for any loss, expenses, damages, costs or other claims arising out
of any redemption or exchange pursuant to telephone instructions from any
person, or our refusal to execute such instructions for any reason.
13. You and we understand and agree that you are solely responsible for
the recommendation by your sales personnel to your customers of the purchase or
sale of Class A Shares of the Fund and the suitability of such purchase or sale
for the customer involved.
14. We shall have full authority to take such action as we may deem
advisable in respect of all matters pertaining to the continuous offering. 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
is intended to operate as, and the provisions of this paragraph shall not in any
way whatsoever constitute, a waiver by you of compliance with any provision of
the Securities Act of 1933, as amended, or of the rules and regulations of the
Securities and Exchange Commission issued thereunder.
15. By accepting this Agreement, you represent that you are registered as
a broker-dealer under the Securities Exchange Act of 1934, are qualified to act
as a broker or dealer in the states or other jurisdictions where you transact
business, and are a member in good standing of the National Association of
Securities Dealers, Inc., and you agree that you will maintain such
registrations, qualifications, and membership in good standing and in full force
and effect throughout the term of this Agreement. You further agree to comply
with all applicable Federal laws, the laws of the states or other jurisdictions
concerned, and the rules and regulations promulgated thereunder and with the
Constitution, By-Laws and Conduct Rules of the National
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Association of Securities Dealers, Inc., and that you will not offer or sell
shares of the Funds in any state or jurisdiction where they may not lawfully be
offered and/or sold.
If you are offering and selling shares of the Fund in jurisdictions outside
the several states, territories, and possessions of the United States and are
not otherwise required to be registered, qualified, or a member of the National
Association of Securities Dealers, Inc., as set forth above, you nevertheless
agree to observe the applicable laws of the jurisdiction in which such offer
and/or sale is made, to comply with the full disclosure requirements of the
Securities Act and the regulations promulgated thereunder and to conduct your
business in accordance with the spirit of the Conduct Rules of the National
Association of Securities Dealers, Inc. You agree to indemnify and hold the
Fund, its investment adviser, and us harmless from loss or damage resulting from
any failure on your part to comply with applicable laws.
16. Upon application to us, we will inform you as to the states in which
we believe the Class D shares have been qualified for sale under, or are exempt
from the requirements of, the respective securities laws of such states, but we
assume no responsibility or obligation as to your right to sell Class D shares
in any jurisdiction. We will file with the Department of State in New York a
Further State Notice with respect to the Class D shares, if necessary.
17. All communications to us should be sent to the address below. Any
notice to you shall be duly given if mailed or telegraphed to you at the address
specified by you below.
18. You agree to maintain records of all sales of shares made through you
and to furnish us with copies of each record on request.
19. You and we understand and agree that, except as expressly provided in
this Agreement, in no transaction will you have any authority to take any action
or make any representation binding upon the Fund, us or any other member of the
Selected Dealers Group.
20. This Agreement may be amended by us from time to time by the following
procedure. We will mail a copy of the amendment to you at your address as
specified below. If you do not object to the amendment within fifteen (15) days
after its receipt, the amendment will become part of the Agreement. Your
objection must be in writing and be received by us within such fifteen days.
21. This Agreement may be terminated upon written notice by either party
at any time, and shall automatically terminate upon its attempted assignment by
you, whether by operation of law or otherwise, or by us otherwise than by
operation of law.
22. Your first order placed pursuant to this Agreement or any amendment
thereto for the purchase of Class D shares of the Fund will represent your
acceptance of this Agreement or any such amendment.
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PRINCETON FUNDS DISTRIBUTOR, INC.
By__________________________________
(Authorized Signature)
Please return one signed copy
of this agreement to:
PRINCETON FUNDS DISTRIBUTOR, INC.
X.X. Xxx 0000
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
Accepted:
Firm Name:___________________________________
By:__________________________________________
Address:______________________________________
Date:_________________________________________
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