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.
00 Xxxx 00xx Xxxxxx [Name of Selected Dealer]
Xxx Xxxx, XX 00000-0000 [Address]
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
____________________________
Print Name Title
____________________________
Address
____________________________
City State Zip
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SCHEDULE A
LIST OF FUNDS
SCHEDULE B
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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