SELLING GROUP AGREEMENT
Dated:
, 19
To Whom It May Concern:
We are the principal underwriter of shares of American Growth Fund, Inc.
(the "Fund"). Subject to the terms and conditions of this letter agreement,
we will sell such shares to you to cover orders received by you as a
principal for your customers.
1.ORDERS. All non-qualified plan mail orders should be sent, together
with check payable to American Growth Fund Sponsors, Inc. in the gross
amount, directly to State Street Bank and Trust Company, c/o American
Growth Fund, Inc., X.X. Xxx 0000, X. Xxxxxx, XX 00000-0000. All wire orders
should be telephoned to our toll-free number, 000-000-0000, or to
000-000-0000. All wire order confirmations and transfer instructions should
be sent directly to State Street Bank and Trust Company. All qualified
retirement plan mail orders should be sent to State Street Bank and Trust
Company, c/o American Growth Fund, Inc., X.X. Xxx 0000, X. Xxxxxx, XX
00000-0000. Such orders will be accepted and confirmed to you at the
applicable public offering prices described in the Fund's currently
effective prospectus, less the dealer discount described in paragraph 3
below and expenses, if any.
2.PAYMENT AND DELIVERY. Upon receipt of confirmation you will pay
promptly the net amounts due as shown thereon, including any transfer taxes
due on sale by you as principal to your customer. Payment should be made
payable to American Growth Fund Sponsors, Inc. and should be delivered to:
State Street Bank and Trust Company
c/o American Growth Fund, Inc.
X.X. Xxx 0000
0 Xxxxxxxx Xx.
X. Xxxxxx, XX 00000
3.SALES CHARGE AND DEALERS DISCOUNT
(a)The sales charges and discounts allowed to dealers on shares
purchased through us are as follows:
Percentage of Applicable Public
Offering Price Single Transaction Total Sales Charge
Dealer Discount
Less than $50,000 5.75%
5.00%
$50,000 but less than $100,000 4.50%
3.75%
$100,000 but less than $250,000 3.50%
2.75%
$250,000 but less than $500,000 2.50%
2.00%
$500,000 but less than $1,000,000 2.00%
1.60%
$1,000,000 and over 0.00%
0.00%
In determining the sales charge and dealer discount applicable to
each purchase all previous purchases by the customer may be aggregated, in
accordance with and subject to the terms of the prospectus.
(b)The above scale applies to aggregate purchases by an individual, his
spouse and children under 21, a trustee or fiduciary of a single trust or
fiduciary account, tax exempt organizations enumerated in Section
501(c)(3) of the Internal Revenue Code, and employees' trusts, profit
sharing and other employee benefit plans qualified under Section 401 of the
Internal Revenue
Code, 403(b) Plans and except for 401(k) Plans, in which each 401(k)
investor is considered separately for purposes of computing sales charges.
Provided, however, that the term "any person" shall not include a
group of individuals whose funds are combined directly or indirectly, for
the purchase of shares of the Fund jointly or through a trustee, agent,
custodian or other representative, nor shall it include a trustee,
agent, custodian or other representative of such a group of individuals.
In addition, any of the persons enumerated above may sign a statement
of intention in the form provided by us covering purchases to be made
within a period of 13 months and thereby become eligible for the
reduced sales charge applicable to the total amount purchased or to the
amount of the specified intended purchase, whichever amount is less,
provided such amount is not less than $50,000.
(c)Purchase of Fund shares at net asset value is available to dealers
for their own account or for retirement plans for their employees or sold
to employees of such dealers (and their spouses or for accounts for
their minor children) that have sales agreements with the underwriter. Such
persons must give written assurance that their purchase is made for
investment purposes and that the securities will not be resold except
through redemption or repurchase by the issuer.
(d)If any shares are repurchased by the Fund or by us for the account
of the Fund or are tendered for redemption within seven business days after
confirmation to you of the original purchase order for such shares,
you shall forthwith refund to us (or we may retain) the full dealer
discount allowed to you on the original sale, and upon receipt thereof we
will as soon as practicable thereafter pay to the Fund the full
amount of the sales charge on the original sale by us. We will notify you
of such repurchase or redemption within 10 days of the date on which the
certificate representing such shares is delivered to us or to the
Fund.
4.OTHER TRANSACTIONS IN SHARES
(a)You will not purchase as principal, or participate as broker in the
purchase of, any shares of the Fund except from us or from your customers,
and then only at the price not lower than the bid price then quoted
by or for the Fund. All purchases from us will be made only to cover orders
already received by you from your customers or for your own bona fide
investment.
(b)You will not sell as principal, or participate as broker in the sale
of, any shares of the Fund except at a price to the purchaser equal to the
applicable public offering price described in the Fund's currently
effective prospectus, unless such sale is to the Fund or to us; but nothing
in this subparagraph (b) shall prevent you from selling to us or to the
Fund any such shares for the account of a customer at the bid price
then quoted by or for the fund and charging the customer a fair commission
for handling the transaction.
(c)You will not withhold placing a customer's order with us in such a
manner as to profit yourself as a result of such withholding.
(d)We will not accept a conditional order for shares of the Fund on any
basis other than at a specified definite price.
5.MISCELLANEOUS
(a)The bid and public offering prices of shares of the Fund will be
furnished from time to time to public information sources.
(b)No person is authorized to make representations concerning shares
of the Fund except those contained in the then effective prospectus and in
other sales literature subsequently issued by
us as information supplementary to such prospectus. In purchasing
shares from us you will rely solely on the representations contained in
such prospectus and other sales literature.
(c)We reserve the right to amend this letter agreement, to reject in
whole or in part any order sent to us by you, and to terminate this letter
agreement for any reason, including the violation by you of any of
its provisions. This letter agreement will terminate automatically if you
cease to be a member in good standing of the National Association of
Securities Dealers, Inc., as you represent yourself to be.
(d)This letter agreement supersedes any prior sales agreement between
us covering shares of the Fund.
(e)All transactions contemplated by this letter agreement are subject
to and must be in compliance with all applicable federal and state laws,
including the Securities Act of 1933 as amended, the Securities
Exchange Act of 1934 as amended, the Investment Company Act of 1940 as
amended, all rules and regulations under such Acts, and any applicable
rules of the National Association of Securities Dealers, Inc.,
particularly Rule 26 of the Rules of Fair Practice.
(f)Nothing in this letter agreement will be deemed or construed to make
you an employee, agent, representative or partner of us or of the Fund, and
you are not authorized to act for us or
for the Fund or make any representations on our behalf or on behalf
of the Fund. We will not be under any liability to you except for
obligations expressly assumed in this letter agreement and any
liability under the Securities Act of 1933 as amended.
(g)From time to time American Growth Fund Sponsors, Inc. may conduct
Due Diligence conferences. To the extent permitted by applicable law, and
subject to the Rules of Fair Practice, participation in these
conferences generally will be based upon a specified sales volume, and
participants will be entitled to receive airfare, hotel accommodations, and
meals for two. You agree that if you object to permitting your sales
representatives to participate in these conferences (and do not intend to
accept cash in lieu thereof to the extent provided by the Rules of
Fair Practice) you will notify us in writing within 30 days of receiving
notice of any sales promotions intended to result in the availability of
such participation.
Please confirm the foregoing by signing one of the enclosed counterparts
of this letter agreement, in the space provided below, and return it to us.
Very truly yours,
Confirmed as of the above date. AMERICAN GROWTH FUND
SPONSORS, INC.
Firm
By
(Authorized Signature)
Address
By
President
Rev. 12/94
Amendment A, replaces section 3 of your
Selling Group Agreement with American Growth Fund Sponsors, Inc.
March
1, 1996
A. Class A shares.
1.
Sales of shares of Class A Common Stock of the Fund will be subject
to, and American Growth Fund Sponsors will pay to dealers as applicable,
sales charges (including any applicable contingent deferred sales charges
("CDSC")), discounts allowed to dealers, and agency fees on Class A shares
purchased through us, in each case in the amount or amounts and in the
manner and subject to any terms and conditions described in the Fund's
prospectus and statement of additional information in effect at the time
of the sale of the Class A shares subject to such charges.
2. Commencing one year after the investment date American Growth Fund
Sponsors will pay selling broker/dealers up to .25 of 1% of the average
daily net assets as a fee for shareholder servicing related to distribution
of shares of the class (a "service fee") calculated annually and paid
quarterly. The service fee payable to a broker/dealer will be based on the
average daily net asset value of shares sold by such broker/dealer and
remaining outstanding on the Fund's books during the period in which the
fee is calculated.
3. If any shares are repurchased by the Fund or by us for the account of
the Fund or are tendered for redemption within seven business days after
confirmation to you of the original purchase order for such shares, you
shall forthwith refund to us (or we may retain) the full dealer discount
allowed to you on the original sale. We will notify you of such repurchase
or redemption within 10 days of the date on which the certificate
representing such shares is delivered to us or to the Fund.
B. Class D Shares
1. Sales of shares of Class D Common Stock of the fund will be subject to,
and American Growth Fund Sponsors will pay to dealers as applicable, sales
charges (including any applicable CDSC), discounts allowed to
dealers, and agency fees on Class D shares purchased through us, in
each case in the amount or amounts and in the manner and subject to any
terms and conditions described in the Fund's prospectus and statement of
additional information in effect at the time of the sale of the Class D
shares subject to
such charges.
2. If any shares are repurchased by the Fund or by us for the account of
the Fund or are tendered for redemption within seven business days after
confirmation to you of the original purchase order for such shares, you
shall forthwith refund to us (or we may retain) the full dealer discount
allowed to you on the original sale. We will notify you of such repurchase
or redemption within 10 days of the date on which the certificate
representing such shares is delivered to us or to the Fund.
3. Class D shares are limited to the Fund's, the Adviser's and the
Distributor's directors and officers and their spouses and family members,
to certain institutional investors, including banks, corporations and
accounts managed by specified types of fiduciaries, and to or for
retirement plans for their employees or sold to employees
of such dealers (and their spouses or for accounts for their
minor children) that have sales agreements with the
underwriter. Such persons must give written assurance that
their purchase is made for investment purposes and that the
securities will not be resold except through redemption or
repurchase by the issuer. Class D shares are also limited to
the existing beneficial holders of Class D shares at the time
of implementation (March 1, 1996). Sponsors reserves the right
to ask for adequate documentation to ensure that shareholders
are eligible for the above shares.
C. Class B Shares
1. Sales of shares of Class B Common Stock of the Fund will be subject to,
sales charges (including any applicable CDSC), and agency fees on Class B
shares purchased through us, in each case in the amount or amounts and in
the manner and subject to any terms and conditions described in the Fund's
prospectus and statement of additional information in effect at the time
of the sale of Class B shares subject to such charges. American Growth Fund
Sponsors will pay a sales commission of 4% of the aggregate value of shares
sold payable on the next normally scheduled commission payment date
following receipt of funds.
2. Commencing one year after the investment date American Growth Fund
Sponsors will pay up to .25 of 1% of the average daily net assets for
shareholder servicing related to distribution of shares of the class (a
"service fee") calculated annually and paid quarterly. The service fee
payable to a broker/dealer will be based on the average daily net asset
value of shares sold by such broker/dealer and remaining outstanding on the
Fund's books during the period in which the fee is calculated.
3. If any shares are repurchased by the Fund or by us for the account of
the Fund or are tendered for redemption within seven business days after
confirmation to you of the original purchase order for such shares, you
shall forthwith refund to us (or we may retain) the full dealer discount
allowed to you on the original sale. We will notify you of such repurchase
or redemption within 10 days of the
date on which the certificate representing such shares is delivered to us
or to the Fund.
D. Sales Charge Structure for American Growth Fund Class C Shares
1.
Sales of shares of Class C Common Stock of the Fund will be subject to,
sales charges (including any applicable CDSC), and agency fees on Class C
shares purchased through us, in each case in the amount or amounts and in
the manner and subject to any terms and conditions described in the Fund's
prospectus and statement of additional information in effect at the time
of the sale of the Class C shares subject to such charges. American Growth
Fund Sponsors will pay a sales commission of 1% of the aggregate value of
shares sold payable on the next normally scheduled commission payment date
following receipt of funds.
2.
In addition, commencing one year after the investment date, American Growth
Fund Sponsors will pay a fee to qualifying broker/dealer firms at the
equivalent of an annual rate of 1% of the average daily net asset value of
the Class C shares, of which .75 of 1% would be a distribution fee and .25
of 1% will be a service fee. Such distribution and service fees will be
paid quarterly, based on the average daily net asset value of shares sold
by such broker/dealers and remaining outstanding on the Funds' books during
the period in which the fee is calculated. 3. If any shares are
repurchased by the Fund or by us for the account of the Fund or are
tendered for redemption within seven business days after
confirmation to you of the original purchase order for such
shares, you will forthwith refund to us (or we may retain) the
full dealer discount allowed to you on the original sale. We will
notify you of such repurchase or redemption within 10 days of
the date on which the certificate representing such shares is
delivered to us or to the Fund.
