EXHIBIT (e)
PLACEMENT AGENCY AGREEMENT
THIS AGREEMENT, dated as of November 17, 2002, by and between Citizens
Funds (the "Trust"), a Massachusetts business trust, and Citizens Securities,
Inc., a New Hampshire corporation ("Placement Agent").
WHEREAS, the Trust engages in business as an open-end management
investment company and is registered as such under the Investment Company Act of
1940, as amended (the "1940 Act");
WHEREAS, the Trust's shares of beneficial interest ("Shares") are
divided into separate series;
WHEREAS, the Trust wishes to retain the services of a placement agent
for the Shares of each of its series listed on Exhibit A hereto (each a "Fund,"
and collectively the "Funds"), as Exhibit A is in effect from time to time;
WHEREAS, Placement Agent has agreed to act as Placement Agent for
Shares of the Funds, including Funds added to this Agreement from time to time
as provided herein;
NOW, THEREFORE, it is hereby agreed between the parties hereto as
follows:
1. APPOINTMENT OF PLACEMENT AGENT.
(a) The Trust hereby appoints Placement Agent as its placement agent
for the Shares of the Funds, and Placement Agent hereby accepts such
appointment. Placement Agent agrees that it shall perform its activities as
placement agent in accordance with all applicable laws, rules and regulations.
In acting as placement agent under this Agreement, Placement Agent shall not
make any offer or sale of Shares in a manner that would require the Shares of
the Funds to be registered under the Securities Act of 1933, as amended (the
"1933 Act").
(b) Placement Agent is not authorized by the Trust to give any
information or make any representations regarding the Funds or the Shares of any
Fund, except such information or representations as are contained in the Trust's
then-current registration statement for the Funds filed with the Securities and
Exchange Commission (the "Registration Statement") or in information furnished
by the Trust pursuant to Section 2(a) hereof.
(c) No Shares of the Funds shall be offered by either Placement Agent
or the Trust under this Agreement, and no orders for the purchase or sale of
such Shares hereunder shall be accepted by the Trust, if and so long as the
effectiveness of the Trust's Registration Statement or any necessary amendments
thereto shall be suspended under any of the provisions of the 1940 Act;
PROVIDED, HOWEVER, that nothing contained in this paragraph (c) shall in any way
restrict the Trust's
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obligation to redeem Shares of the Funds from any investor in accordance with
the provisions of the Registration Statement or the Trust's Declaration of
Trust, as amended from time to time.
(d) Nothing herein shall be construed to require the Trust to accept
any offer to purchase any Shares of any Fund.
2. FURNISHING OF INFORMATION.
(a) The Trust shall furnish to Placement Agent copies of any
information, annual financial statements and other documents that Placement
Agent may reasonably request for use in connection with the sale of Shares of
the Funds under this Agreement. The Trust shall also furnish Placement Agent
upon request with (i) unaudited semi-annual statements of the Funds' books and
accounts prepared by the Trust, and (ii) from time to time such additional
information regarding the Funds' financial or regulatory condition as Placement
Agent may reasonably request.
(b) The Trust agrees to advise Placement Agent immediately in writing:
(i) of any request by the Securities and Exchange Commission
(the "Commission") for amendments to any registration statement or for
additional information on behalf of or relating to the Funds;
(ii) in the event of the issuance by the Commission of any
stop order suspending the effectiveness of any such registration
statement or the initiation of any proceeding for that purpose;
(iii) of the happening of any event which makes untrue any
statement of a material fact made in any such registration statement or
which requires the making of a change in such registration statement in
order to make the statements therein not misleading; and
(iv) of all actions of the Commission with respect to any
amendments to any such registration statement or which may from time to
time be filed with the Commission.
For purposes of this Section 2(b), informal requests by or acts of the Staff of
the Commission shall not be deemed actions of or requests by the Commission.
3. EXPENSES.
(a) The Trust will pay or cause to be paid on behalf of the Funds the
following expenses: organization costs of the Funds, as applicable; compensation
of Trustees who are not "affiliated persons" of Placement Agent; governmental
fees; interest charges; loan commitment fees; taxes; membership dues in industry
associations allocable to the Trust; fees and expenses of independent auditors,
legal counsel and any transfer agent, investor servicing agent, registrar or
dividend disbursing agent of the Trust; expenses of issuing and redeeming Shares
of the
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Funds; expenses of preparing, typesetting, printing and mailing registration
statements, investor reports, notices, proxy statements and reports to
governmental officers and commissions; expenses connected with the execution,
recording and settlement of security transactions; insurance premiums; fees and
expenses of the custodian for all services, including safekeeping of funds and
securities and maintaining required books and accounts; expenses of calculating
net asset value (including but not limited to the fees of independent pricing
services); expenses of meetings of investors; expenses relating to the
registration of the Shares of the Funds; and such non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or proceedings
to which the Trust may be a party and the legal obligation which the Trust may
have to indemnify its Trustees and officers with respect thereto.
(b) Except as otherwise provided in this Agreement, Placement Agent
will pay or cause to be paid all expenses incurred by Placement Agent in
connection with the sale of the Funds' Shares as contemplated by this Agreement.
4. INDEMNIFICATION BY THE TRUST. In the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of Placement Agent, the Trust on behalf of each Fund
agrees to indemnify Placement Agent, its officers and directors, and any person
that controls Placement Agent within the meaning of the 1933 Act against any and
all claims, demands, liabilities and expenses that any such indemnified party
may incur under the 1933 Act, or common law or otherwise, arising out of or
based upon any alleged untrue statement of a material fact contained in the
registration statement for that Fund, or any omission to state a material fact
therein, the omission of which makes any statement contained therein misleading,
unless such statement or omission was made in reliance upon and in conformity
with information furnished to the Trust in connection therewith by or on behalf
of Placement Agent. Nothing herein contained shall require the Trust on behalf
of the Funds to take any action contrary to any provision of its Declaration of
Trust or any applicable statute or regulation.
5. INDEMNIFICATION BY PLACEMENT AGENT. Placement Agent agrees to
indemnify the Trust, its officers and Trustees and any person that controls the
Trust within the meaning of the 1933 Act against any and all claims, demands,
liabilities and expenses that any such indemnified party may incur under the
1933 Act, or common law or otherwise, arising out of or based upon (i) any
alleged untrue statement of a material fact contained in the registration
statement for the Funds, or any omission to state a material fact therein, the
omission of which makes any statement contained therein misleading, if such
statement or omission was made in reliance upon and in conformity with
information furnished to the Trust in connection therewith by or on behalf of
Placement Agent; and (ii) any act or deed of Placement Agent or its employees or
agents that has not been authorized by the Trust in the Registration Statement
or by this Agreement.
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6. TERM AND TERMINATION.
(a) This Agreement shall become effective with respect to the Shares of
each Fund on the date indicated on Exhibit A attached hereto opposite the
applicable Fund. Exhibit A may be amended from time to time to add additional
series of the Trust as agreed by the Trust and Placement Agent. This Agreement
shall continue with respect to each Fund for successive annual periods after its
effectiveness so long as each such continuance is specifically approved by votes
of a majority of both the Trustees of the Trust and the Trustees of the Trust
who are not parties to this Agreement or interested persons (as defined in the
0000 Xxx) of any such party and who have no direct or indirect financial
interest in this Agreement, cast in person at a meeting called for the purpose
of voting on such approval.
(b) This Agreement is terminable as to the Trust as a whole or any
Fund, without penalty, on not more than 60 days' nor less than 30 days' notice
to Placement Agent by the Trustees of the Trust, by vote of a majority of the
outstanding voting securities (as defined in the 0000 Xxx) of the applicable
Fund or on not less than 90 days' notice to the Trust by Placement Agent.
(c) This Agreement shall automatically terminate in the event of its
assignment (as defined in the 1940 Act).
7. LIMITATION OF LIABILITY. Each party acknowledges and agrees that all
obligations of the Trust on behalf of a particular Fund under this Agreement are
binding only on that Fund; that any liability of the Trust on behalf of a
particular Fund under this Agreement, or in connection with the transactions
contemplated herein, shall be discharged only out of the assets of that Fund;
and that no other series of the Trust shall be liable with respect thereto.
The obligations of the Trust hereunder shall not be binding upon any of
the Trustees, officers or investors of the Trust personally, but shall bind only
the assets and property of the Trust. Any reference to the Trust hereunder means
and refers to the Trustees from time to time serving under the Declaration of
Trust of the Trust. The execution and delivery of this Agreement has been
authorized by the Trustees, and this Agreement has been signed on behalf of the
Trust by an authorized officer of the Trust, acting as such and not
individually, and neither such authorization by such Trustees nor such execution
and delivery by such officer shall be deemed to have been made by any of them
individually or to impose any liability on any of them personally, but shall
bind only the assets and property of the Trust as provided in the Declaration of
Trust.
8. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of The Commonwealth of Massachusetts and the provisions
of the 1940 Act.
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IN WITNESS THEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above.
CITIZENS FUNDS
ON BEHALF OF ITS SERIES LISTED ON EXHIBIT A
ATTACHED HERETO
By: /s/ Xxxxxx Xxxxxxx
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CITIZENS SECURITIES, INC.
By: /s/ Xxxxxx Xxxxxxxx
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EXHIBIT A
FUND EFFECTIVE DATE
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Citizens Government Obligations Fund April 29, 2003
Citizens Prime Money Market Fund April 29, 2003
