American Skandia
Financial Institution
Mutual Fund Sales Agreement
This Mutual Fund Sales Agreement ("Agreement") is made by and between American
Skandia Marketing, Incorporated ("ASM, Inc.", "Principal Underwriter", "us" or
"we"), a broker-dealer registered with the Securities and Exchange Commission
("SEC") under the Securities and Exchange Act of 1934, as amended (the "1934
Act") and a member of the National Association of Securities Dealers, Inc.
("NASD") and ________________________, who is also a broker-dealer registered
with the SEC under the 1934 Act and a member of the NASD or is a "bank" as
defined in Section 3(a)(6) of the 1934 Act, and at the time of each transaction
subject to this Agreement, are not required to register as a broker-dealer under
the 1934 Act (both referred to herein as a "Broker-Dealer").
WHEREAS, each company, as listed in a schedule hereto (each a "Company") is
registered as an investment company under the Investment Company Act of 1940, as
amended (the "1940 Act") has entered into an agreement naming ASM, Inc. as the
Principal Underwriter and general Distributor for the shares each Company
comprised of the separate classes and portfolios listed on a schedule hereto (as
the same may be amended from time to time by us to add or delete portfolios
and/or classes of shares) and referred to collectively as the "Funds" or
individually as the "Fund,"; and
WHEREAS, ASM, Inc. wishes to enter into agreements with broker-dealers whereby
registered representatives who are associated with Broker-Dealer, and who are
NASD registered, or are exempt from such regulation, and are duly licensed under
applicable state law, solicit sales of shares of the Funds; and
WHEREAS, Broker-Dealer, which is a member in good standing of the NASD or is
exempt from such regulation, wishes to enter into an agreement to distribute
shares of the Funds; and
WHEREAS, ASM, Inc. acknowledges and Broker-Dealer agrees to provide certain
supervisory and administrative services to registered representatives who are
associated with the Broker-Dealer in connection with the solicitation, service
and sale of the Funds.
NOW THEREFORE, in consideration of the mutual covenants contained in this
Agreement, the parties agree to the following:
1. Regulation: You agree to comply with all applicable provisions of the
1940 Act the Securities Act of 1933, as amended (the "1933 Act"), the
1934 Act, and all the rules and regulations of the SEC, NASD, state
securities laws, applicable banking laws, rules and regulations,
fiduciary obligations under state law, each as applicable. To the
extent that a Broker-Dealer is NASD registered, the NASD Rules of Fair
Practice are incorporated herein as if set forth in full.
2. Orders: An order for shares of any class and any Fund received from you
will be confirmed only at the appropriate offering price applicable to that
order, as described in each Company's then current Prospectus. The procedure
relating to orders and the handling thereof will be subject to instructions
released by us from time to time. Orders should be transmitted to the Fund's
shareholder servicing agent ("Transfer Agent"). Broker-Dealer or his customer
may, however, mail a completed application with a check payable to the Fund
directly to the Transfer Agent as listed in a schedule attached hereto or by
such other method as may be described in each Company's then current Prospectus.
All orders are subject to acceptance at the Transfer Agent's office. We, as
agent for the Funds, reserve the right in our sole discretion to reject any
order. The minimum investment for each Fund is set forth in each Company's then
current Prospectus.
You shall not purchase any Shares as agent for any customer, unless you
deliver or cause to be delivered to such customer, at or prior to the
time of such purchase, a copy of the Prospectus or unless such customer
has acknowledged receipt of the Prospectus. You hereby represent that
you understand your obligation to deliver the Prospectus to customers
who purchase Shares pursuant to federal securities laws and you have
taken all necessary steps to comply with such Prospectus delivery
requirements. The minimum initial investment for each Fund is set forth
in each Company's then current Prospectus.
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: (a) you shall be acting solely as agent for the account of your
customer; (b) each transaction shall be initiated solely upon the order
of your customer; (c) we shall execute transactions only upon receiving
instructions from you acting as agent for your customer; (d) as between
you and your customer, your customer will have full beneficial
ownership of all Shares; (e) each transaction shall be for the account
of your customer and not for your account; and (f) unless otherwise
agreed in writing, 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.
3. Suitability and Multiple Classes of Shares: The Funds may be offered in
more than one class of shares in accordance with the Prospectus. Purchases of a
class of shares or Funds are subject to our compliance standards. You are
responsible for determining whether a Fund, and which class of the Fund's
shares, is suitable for your client. Certain investors that are affiliated with
us and with you (and their families) may have special purchase rights. Certain
classes of Fund shares may be available only in connection with purchases for or
by specific types of qualified retirement plans, or may be available only to
groups of purchasers, or to retirement plans purchasing on behalf of a group of
retirement plan participants that meet each Company's requirements as to the
size of such groups or the number of retirement plan participants Refer to the
currently effective Prospectus for each Company. Additional portfolios and/or
classes of shares may be added at a later date.
If you are a bank not required to register as a broker-dealer under the
1943 Act, you further represent and warrant to us that with respect to
any sales in the United States, you will use your best efforts to
ensure that any purchase of Shares by our 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.
4. Sales/Agency Commissions
(a) Any sales charges and commissions (sales and/or agency
commissions) will be as set forth in the current Prospectus of
each Company and on a schedule 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 payments made in accordance with a Fund's Plan
of Distribution pursuant to Rule 12b-1 under the 1940 Act, as
amended, to your address as it appears on our records. You
must notify us of address changes and promptly negotiate 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 which impose a Contingent
Deferred Sales? ? Charge ("CDSC"), we agree to compensate
selling firms at a specified rate as disclosed in the
applicable schedule only on purchase payments for those shares
which are subject to a CDSC at the time of investment. You
understand that any CDSC deducted from redemption proceeds
shall be the property of ASM, Inc.
(d) We reserve the right to reclaim any commission payment from a
Broker-Dealer if we later determine a CDSC waiver applied at
the time of investment.
(e) We reserve the right to modify all CDSC waivers at any time. ASM, Inc.
will promptly notify Broker-Dealer of any modification thereto.
(f) You are responsible for applying the correct sales charge to
your customers, as detailed in the current Prospectus and in
the applicable schedule hereto or as might otherwise be agreed
to in writing by the parties.
(g) There are no sales charges or commissions payable on the reinvestment
of dividends and distributions.
5. Service Fee: ASM, Inc. will also pay you, if and to the extent paid by
each Company, an account service fee with respect to a class of Shares, as set
forth in the Prospectus and in a schedule attached hereto, subject to your
compliance with this Agreement and to your providing the following services to
Fund accounts, including but not limited to: (1) maintaining regular contact
with customers and assist in answering routine inquiries concerning the Funds;
(2) assisting in distributing sales and service literature provided by us,
particularly to the beneficial owners of street name accounts; (3) assisting us
and our agents in establishment and maintenance of shareholder accounts and
records; (4) assisting shareholders in effecting administrative changes, such as
changing account designations and addresses; (5) assisting in processing
purchase and redemption transactions; and (6) providing any other information or
services as the customers or we may reasonably request. Any such account service
fees shall be subject to and in accordance with applicable laws, rules and
regulations and the guidelines and rules of the NASD. We reserve the right to
increase, decrease or terminate any such fees without prior notice to you.
6. Remittance: Remittance of funds by Broker-Dealers should be made by
check or wire, payable to the appropriate Fund (not to ASM, Inc.) and
sent to the Company's Transfer Agent. Payments must be received
promptly pursuant to Rule 2830(m) of the NASD Rules of Fair Practice
(formerly Article III, Section 26(m)), otherwise the Company and ASM,
Inc. reserves the right, without notice, to cancel the sale. In such
event, Broker-Dealer will be responsible for any loss to the Fund, or
to ASM, Inc., including the loss of profit resulting from your failure
to make payment.
7. Selling Group Activities
(a) Shares of any Fund may be liquidated by sale thereof to such
Fund or to us as Agent for such Fund at the applicable net
asset value, less any applicable CDSC, determined in the
manner described in the then current Prospectus and Statement
of Additional Information of the Company. If delivery is not
made within ten (10) days from the date of the transaction,
the Company and ASM, Inc. reserves the right, without notice,
to cancel the transaction, in which event Broker-Dealer will
be held responsible for any loss to the Fund, or to ASM, Inc.,
including loss of profit resulting from your failure to make
payment.
(b) In no event shall you withhold placing orders so as to profit from such
withholding by a change in the net asset value from that used in determining the
price to your customer, or otherwise. You shall make no purchases except for the
purpose of covering orders received by you and then such purchases must be made
only at the applicable public offering price described in each Company's then
current Prospectus (less your sales concession); provided, however, that the
foregoing does not prevent the purchase of shares of a Fund by you for your own
bona fide investment. All sales to your customers shall be at the applicable
public offering prices determined in accordance with each Company's then current
Prospectus and Statement of Additional Information.
(c) In addition to purchasing shares of any Fund through us as
Selling Agent, you may purchase such shares from your
customers, in which case you shall pay the applicable net
asset value determined in accordance with each Company's then
current Prospectus and Statement of Additional Information,
less any applicable CDSC, if such class of Fund imposes a
CDSC.
8. Shareholder Communication: 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 Fund's shares:
(a) All proxy or information statements prepared for circulation to
shareholders of record;
(b) Annual reports of the Funds;
(c) Semi-annual reports of the Funds; and
(d) All updated prospectus, supplements, and amendments thereto.
It shall be 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/or banking laws, rules and
regulations and any other applicable regulations.
9. Refund of Sales Charge: If the shares of any Fund confirmed to you
hereunder are repurchased by such Fund, or by us as Agent for such
Fund, or are tendered for liquidation to such Fund, within ten (10)
business days after such confirmation of your original order, then you
shall forthwith repay to such Fund the full dealer sales concession
allowed to you on the sale of such Fund shares. We shall notify you of
such repurchase or redemption within ten (10) days from the day on
which the redemption order is delivered to us or to such Fund.
10. Statements/Representations: No person is authorized to make any
statements or representations relating to the shares of any Fund,
except those contained in its then current Prospectus and Statement of
Additional Information which you agree to deliver to investors in
accordance with applicable SEC and NASD regulations and in such
additional information as we may supply or authorize as Supplemental
Information to such Prospectus and Statement of Additional Information
(i.e., advertisements and supplemental sales literature).
You shall not allow unauthorized statements or information designated
by us as "Not For Use With The Public" or "For Broker-Dealer Use Only"
to be distributed directly or indirectly to an investor. You shall
deliver to us for prior approval any Supplemental Information prepared
by you related to the Funds for use with the public.
In ordering shares of any Fund you shall rely solely and conclusively
on the representations contained in its then current Prospectus,
Statement of Additional Information, and Supplemental Information, if
any, additional copies of which are and will be available on request.
In no transaction shall you have any authority whatever to act as agent
for any Fund, or for us, or for any other distributor. Nothing in this
Agreement shall constitute either of us as an agent of the other, or
shall constitute you or any Fund the agent of the other.
No person is authorized to make any statement or representations
regarding benefits or services offered by any affiliate of an
applicable Fund or any other benefit or service provider to investors
or to persons for whom investments are made in a Fund that state,
indicate or imply that such benefits are offered or endorsed by the
Fund and any directors, trustees or officers of the Fund, or by ASM,
Inc., its officer or directors. This excludes those benefits or
services provided to shareholders by the Fund or on behalf of the Fund
in its normal course of business.
11. Warranties: You represent and warrant that:
(a) you are either (1) 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 of the Funds
under the laws of the jurisdictions in which the shares of the
Funds will be offered and sold by you or (2) you are a "bank"
as defined in Section 3(a)(6) of the 1934 Act;
(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 of the Funds you will comply with all
applicable laws, rules and regulations, including the
applicable provisions of the 1933 Act, 1934 Act and 1940 Act,
as amended, the applicable rules and regulations of the NASD,
banking laws, rules and regulations, and the applicable rules
and regulations of the jurisdictions in which you sell,
directly or indirectly, any shares of the Funds;
(d) you will offer to sell shares of the Funds only to purchasers meeting
the applicable eligibility requirements set forth in the Prospectus;
(e) you agree not to offer for sale or sell shares of the Funds in
any jurisdictions in which shares of the Funds are not
qualified for sale or in which you are not qualified as a
broker dealer (we will, upon request, 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) 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) you will not make Shares of any Fund available to your
customers, including your fiduciary customers, 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 related rules,
regulations and interpretations, which may affect your
business practices.
You agree to indemnify and hold ASM, Inc. and each Company 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 the foregoing representations and warranties if we notify you
promptly after commencement of any action brought against us for which
we may seek indemnity.
12. Pricing Errors: With respect to any pricing errors relating to
transactions entered into by you on behalf of your customers, you agree
to use your best efforts in cooperating with us to resolve and remedy
such errors upon receipt of notice from us. We will adjust transactions
in accordance with procedures established by each Company and we will
notify you of such adjustments.
13. Modification and Termination: We reserve the right, in our discretion
and without notice to you or to any distributor, to suspend sales, to withdraw
any offering, to change the offering prices or to modify or cancel this
Agreement for any reason (including the termination of Plan payments pursuant to
a Plan of Distribution described in Section 4). This Agreement may be canceled
at any time by you upon thirty (30) days written notice. We may terminate this
Agreement for failure to comply with its terms upon mailing notice to you. In
addition, this Agreement may be terminated with respect to any Fund or class of
shares of a Company by the directors of such Company and by the holders of the
outstanding voting securities entitled to vote on such termination as provided
in Rule 12b-1 under the 1940 Act. This Agreement shall terminate automatically
if you are expelled or suspended from the NASD, or there is an assignment of
this Agreement or ASM Inc. otherwise ceases to be the general distributor for
the Company (the term "assignment" shall have the meaning specified in the 1940
Act and the rules and regulations thereunder, subject to such exemptions as my
be granted by the Securities and Exchange Commission).
14. Investors Account Instructions: If any investor's account is
established without the investor signing the application form, the
Broker-Dealer represents that the instructions relating to the
registration (including the investor's tax identification number) and
selected options furnished to the Fund (whether on the application
form, or in some other document) are in accordance with the investor's
instructions. Broker-Dealer agrees to indemnify the Company and/or the
Fund(s), its Transfer Agent, and ASM, Inc. for any loss or liability
resulting from acting upon such instructions. We agree to hold harmless
and indemnify you for any loss or liability arising out of our
negligence in processing such instructions.
15. Liability: Nothing contained herein shall be deemed to protect you
against any liability to us, the Company or the Company's shareholders
to which you would otherwise be subject by reason of negligence,
willful misfeasance, or bad faith in the performance of your duties
hereunder, or by reason of your reckless disregard of your obligations
and duties hereunder.
16. Non-Waiver Provision: 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.
17. Severability: Should any provision of this Agreement to be held
unenforceable, those provisions not affected by the determination of
unenforceability shall remain in full force and effect.
18. Governing Law: This Agreement will be construed in accordance with the
laws of the State of Connecticut.
If the foregoing completely expresses the terms of the Agreement between us,
please so signify by executing, in the space provided, the annexed duplicate of
this Agreement and return it to us, retaining the original copy for your own
files. This Agreement shall become effective upon the earliest of our receipt of
a signed copy hereof or the first order placed by you for any of the Funds'
shares after the date below, which order shall constitute acceptance of this
Agreement. This Agreement shall supersede all prior Mutual Fund Sales Agreements
relating to the shares of any of the Funds. All amendments to this Agreement,
including any changes made pursuant to schedules to the Agreement, shall take
effect as of the date of the first order placed by you for any of the Fund's
shares after the date set forth in the notice of amendment sent to you by the
undersigned.
IN WITNESS WHEREOF, the undersigned parties have executed this Agreement to be
effective as set forth above, upon the Effective Date below.
AMERICAN SKANDIA MARKETING, INCORPORATED
BY: __________________________________
Name: __________________________________
Title: __________________________________
Date: __________________________________
Please execute this Selling Group Agreement below and return it to us at the
address set forth above.
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(Broker-Dealer's Name)
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(Street Address)
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(City) (State) (Zip Code)
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(Telephone No.)
BY: ___________________________________________
(Authorized Signature)
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(Name and Title)
SCHEDULE: PORTFOLIOS
AMERICAN SKANDIA ADVISOR FUNDS, INC.
Date: July 1, 1997
The following portfolios of American Skandia Advisor Funds, Inc. are
subject to this Agreement:
ASAF Founders International Small Capitalization Fund
XXXX X. Xxxx-Price International Equity Fund
ASAF Founders Small Capitalization Fund
XXXX X. Xxxx Price Small Company Value Fund
XXXX Xxxxx Capital Growth Fund
ASAF INVESCO Equity Income Fund
ASAF American Century Strategic Balanced Fund
ASAF Federated High Yield Bond Fund
ASAF Total Return Bond Fund
ASAF JPM Money Market Fund
The Company may add additional portfolios and/or classes of
portfolios from time to time.
Transfer Agent
American Skandia Advisor Funds, Inc. Mail Address:
XX Xxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Overnight Address:
American Skandia Advisor Funds, Inc.
Xxx Xxxxxxxx Xxxxx
Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Electronic Transfer:
State Street Bank & Trust Company
Boston, Massachusetts
DDA #99052995
FBO: American Skandia Advisor Funds, Inc.
[Fund name and Class of Shares]
Shareholder Name and Account Number
SCHEDULE: SALES CONCESSIONS/AGENCY COMMISSIONS
AMERICAN SKANDIA ADVISOR FUNDS, INC.
Date: July 1, 1997
Class A Shares
All Portfolios except ASAF Total Return Bond Fund and ASAF Federated High Yield Bond Fund
Amount of Purchase Standard Sales Concession Promotional Sales Commission*
less than $50,000 4.25% 5.00%
$50,000 - $100,000 3.50% 4.25%
$100,000 - $250,000 2.50% 3.25%
$250,000 - $500,000 1.75% 2.25%
$500,000 - $1,000,000 1.25% 1.50%
greater than $1,000,000 and other Class A Purchases
subject to a CDSC as set forth in the
current Prospectus .50% .50%
ASAF Total Return Bond Fund and ASAF Federated High Yield Bond Fund Only
Amount of Purchase Standard Sales Commission Promotional Sales Commission*
less than $50,000 3.50% 4.25%
$50,000 - $100,000 3.00% 3.75%
$100,000 - $250,000 2.50% 3.25%
$250,000 - $500,000 1.75% 2.25%
$500,000 - $1,000,000 1.25% 1.50%
greater than $1,000,000 and other Class A Purchases
subject to a CDSC as set forth in the
current Prospectus .50% .50%
For Purchases greater than $1,000,000 and other Class A Purchases subject to a CDSC:
Service Fees: 0.25% per annum based on the daily net assets of such shares
beginning in the first quarter of year 2 after such share
purchase.
Trail Commissions: 0.25% per annum based on the daily net assets of such
shares beginning in the first quarter of year 2 after such
share purchase.
For all other Purchases:
Service Fees: 0.25% per annum based on the daily net assets of such shares
beginning in the first quarter of year 1 after such share
purchase.
Trail Commissions: 0.25% per annum based on the daily net assets of such shares
beginning in the first quarter of year 1 after such share
purchase.
Class B Shares
Standard Sales Commission Promotional Sales Commission*
5.50% of the Amount of Purchase 6.00% of the Amount of Purchase
Service Fees: 0.25% per annum based on the daily net assets of such shares
beginning in the first quarter of year 8 after such share
purchase.
Trail Commissions: 0.25% per annum based on the daily net assets of such shares
beginning in the first quarter of year 8 after such share
purchase.
Class X Shares
Standard Sales Commission Promotional Sales Commission*
3.00% of the Amount of Purchase 3.50% of the Amount of Purchase
Service Fees: 0.25% per annum based on the daily net assets of such shares
beginning in the first quarter of year 8 after such share
purchase.
Trail Commissions: 0.25% per annum based on the daily net assets of such shares
beginning in the first quarter of year 8 after such share
purchase.
* The Promotional Sales Commission will be payable instead of the Standard Sales
Commission for purchases placed on or before December 31, 1998. The Promotional
Sales Commission may be eliminated at the sole discretion of ASM, Inc. at any
time prior to December 31, 1998. For purchases received after December 31, 1998,
(unless the Promotional Sales Commission has been previously eliminated) the
Standard Sales Commission will apply
Class C Shares
1.00% of the Amount of Purchase
Service Fees: 0.25% per annum based on the daily net assets of such shares
beginning in the first quarter of year 2 after such share
purchase.
Trail Commissions: 0.75% per annum based on the daily net assets of such shares
beginning in the first quarter of year 2 after such share
purchase.
