BROKER DEALER SELLING AGREEMENT
EXHIBIT
(e.2)
SELLING
AGREEMENT
THIS
BROKER DEALER SELLING AGREEMENT (“Agreement”) made and entered into between ALPS
Distributors, Inc. (“ADI”), a Colorado corporation having its principal place of
business at 0000 Xxxxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000,
and____________________________________,
a
_________________________ company having its principal place of business
________________________________________________________ (hereinafter
“Broker/Dealer”).
WHEREAS,
Broker/Dealer desires to enter in this Agreement with ADI to sell shares
of
Heartland Group, Inc. (“Company”), a registered open-end investment management
company, Broker/Dealer will provide distribution related, continuing personal
services to shareholder and/or administration of shareholder accounts in,
to the
fund(s) currently offered by the Company. ADI is the principal underwriter
and,
agent for the Company.
WHEREAS,
Broker/Dealer understands that pursuant to the Investment Company Act of
1940,
as amended (the “1940 Act”), the mutual fund(s) offered by the Company and
distributed by ADI (each individually a “Fund” and collectively “Funds”) have
adopted, pursuant to Rule 12b-1 of the 1940 Act, Distribution and Service
Plans
(each individually a “Plan” and collectively “Plans”) with ADI to enable
payments to certain entities for distribution assistance and shareholder
servicing.
WHEREAS,
the term “Prospectus” means the prospectus and, unless the context otherwise
requires, the related statement of additional information (“SAI”) incorporated
therein by reference, as the same are amended and supplemented (“Supplements”)
from time to time by the Funds.
NOW,
THEREFORE, in consideration of the mutual covenants and promises set forth
herein, the parties agree as follows:
| 1. |
Purchases
of Company Shares for Sale to
Customers.
|
| (a) |
Broker/Dealer
is hereby appointed as a non-exclusive selling agent of the Company
during
the term herein specified for the purpose of finding suitable investors
for shares of the Funds as described herein. Subject to the performance
by
ADI of its obligations to be performed hereunder and to the completeness
and accuracy in all material respects of all the representations
and
warranties of ADI contained herein, Broker/Dealer hereby accepts
such
agency and agrees on the terms and conditions set forth herein and
in each
Fund’s then-current Prospectus to use reasonable efforts during the term
hereof to find suitable investors and to provide ongoing services
to such
investors for the duration of their investments. It is understood
that the
Broker/Dealer has no commitment with regard to the sale of the Funds’
shares other than to use reasonable efforts and this Agreement shall
not
prevent Broker/Dealer from acting as a selling agent or underwriter
for
the securities of other issuers that may be offered or sold during
the
term hereof. Broker/Dealer’s agency relationship with ADI hereunder shall
continue until the termination of this Agreement. Any sales of a
Fund’s
shares made prior to the date hereof by Broker/Dealer shall be deemed
made
pursuant to this Agreement.
|
| (b) |
In
offering and selling a Funds’ shares to Broker/Dealer’s customers,
Broker/Dealer agrees to act as dealer for Broker/Dealer’s own account and
in no transaction shall the Broker/Dealer have any authority to act
or
hold itself out as agent for ADI or the Company. ADI acknowledges
that
customers of Broker/Dealer who purchase a Fund’s shares are the
Broker/Dealer’s customers. Broker/Dealer shall be responsible for opening,
approving, and monitoring customer accounts and for the review and
supervision of these accounts, all in accordance with the rules and
regulations of the Securities and Exchange Commission (“SEC”) and National
Association of Securities Dealers, Inc.
(“NASD”).
|
1
| (c) |
Broker/Dealer
agrees to offer and sell each Fund’s shares to Broker/Dealer’s customers
only at the applicable public offering price, giving effect to any
cumulative or quantity discounts or other purchase programs, plans,
or
services described in the then-current Prospectus. Broker/Dealer
agrees to
deliver, or cause to be delivered, to each customer, at or prior
to the
time of any purchase of shares, a copy of the then current Prospectus
(including any supplements thereto), and to each customer who so
requests,
a copy of the then-current SAI (including any supplements
thereto).
|
| (d) |
Broker/Dealer
agrees to purchase each Fund’s shares only from ADI or from
Broker/Dealer’s customers. If Broker/Dealer purchases shares of a Fund
from ADI, Broker/Dealer agrees that all such purchases shall be made
only:
(a) to cover orders of shares of such Fund already received by
Broker/Dealer from its customers; (b) for shares of such Fund being
acquired by Broker/Dealer’s customers pursuant to either the exchange
privilege or the reinvestment privilege, as described in the then-current
Prospectus of such Fund; (c) for Broker/Dealer’s own bona fide investment;
or (d) for investments by any Internal Revenue Service (“IRS”) qualified
plan or other trust established for the benefit of Broker/Dealer’s
employees or for investments in Individual Retirement Accounts established
by Broker/Dealer’s employees, and if Broker/Dealer so advises ADI in
writing prior to any sale of a Fund’s shares pursuant to this subparagraph
(d), Broker/Dealer agrees to waive all Broker/Dealer concessions,
if any,
to all sales of shares. If Broker/Dealer purchases a Fund’s shares from
Broker/Dealer customers, Broker/Dealer agrees not to purchase such
shares
from Broker/Dealer customers at a price lower than the applicable
redemption price for such Fund, determined in the manner described
in the
then-current Prospectus. Broker/Dealer shall not withhold placing
customers’ orders for shares so as to profit the Broker/Dealer as a result
of such withholding (e.g., to include, but not limited to, a change
in a
Fund’s net asset value from that used in determining the offering price
to
Broker/Dealer’s customers).
|
| (e) |
ADI
will accept Broker/Dealer’s purchase orders for Fund Shares only at the
public offering price applicable to each order, as determined in
accordance with the then-current Prospectus. ADI will not accept
from
Broker/Dealer a conditional order. All orders redeeming any Fund
shares
shall be executed in accordance with Rule 22c-1 of the 1940 Act.
All
orders are subject to acceptance or rejection by ADI in its sole
discretion. ADI reserves the right, at its discretion and without
notice
to the Broker/Dealer, to suspend sales or to withdraw the offering
of a
Fund’s shares, in whole or in part, or to make a limited offering of any
Fund’s shares. The minimum and maximum dollar amounts for purchase of
a
Fund’s shares (and any classes thereto) for any shareholder shall be the
applicable minimum or maximum amount described in such Fund’s then-current
Prospectus and no order for less or more than, as the case may be,
such
amount will be accepted hereunder.
|
| (f) |
The
transmission of orders for Fund shares will be governed by instructions
that ADI will periodically issue to Broker/Dealer. Broker/Dealer
must pay
for a Fund’s shares in ‘Federal Funds,’ and ADI must receive
Broker/Dealer’s payment on or before the settlement date established in
accordance with Rule 15c6-1 under the Securities Exchange Act of
1934, as
amended. If ADI does not receive Broker/Dealer’s payment on or before such
settlement date, ADI may, without notice, cancel the sale, or, at
ADI’s
option, sell a Fund’s shares that Broker/Dealer ordered back to the
issuing Fund. Broker/Dealer agrees to reimburse, indemnify and hold
harmless each of ADI and the issuing Fund for any loss suffered by
ADI or
the issuing Fund as a result of Broker/Dealer’s failure to make payment as
required.
|
2
EXHIBIT
(e.2)
| (g) |
Broker/Dealer
agrees to use the application provided with the Prospectus as the
means of
placing a customer’s order except for accounts opened or maintained
pursuant to the networking system of the National Securities Clearing
Corporation (“NSCC”). The application will be reviewed by ADI or the
Company to determine that all information necessary to issue a Fund’s
shares has been entered. Broker/Dealer hereby certifies that all
of
Broker/Dealer customers’ taxpayer identification numbers (“TIN”) or social
security numbers (“SSN”) furnished to ADI or the Company by Broker/Dealer
are correct and that ADI or the Company will not open an account
without
Broker/Dealer providing the Company’s Transfer Agent (“Transfer Agent”)
with the customer’s TIN or SSN.
|
| (h) |
Broker/Dealer
will comply with all applicable Federal and state laws and with the
rules
and regulations of applicable regulatory agencies thereunder.
Broker/Dealer will not offer shares of any Fund for sale in any
jurisdiction unless such shares are duly registered therein under
all the
applicable securities laws, rules and
regulations.
|
| (i) |
Any
transaction in shares of a Fund shall be effected and evidenced by
book-entry on the records maintained by the transfer agent. A confirmation
statement evidencing transactions in a Fund’s shares will be transmitted
to Broker/Dealer by the Transfer Agent.
|
| 2. |
Account
Options.
|
| (a) |
Broker/Dealer
may appoint the Transfer Agent as Broker/Dealer’s agent to execute
customers' transactions in a Fund’s shares sold to Broker/Dealer by ADI in
accordance with the terms and provisions of any account, program,
plan, or
service established or used by Broker/Dealer’s customers and to confirm
each such transaction to Broker/Dealer’s customers on Broker/Dealer’s
behalf, and at the time of the transaction, Broker/Dealer guarantees
the
legal capacity of its customers so transacting in such Fund shares
and any
co-owners of such Fund shares.
|
| (b) |
Unless
otherwise instructed by ADI or the Transfer Agent, Broker/Dealer
may
instruct the Transfer Agent to register shares purchased in
Broker/Dealer’s name and account as nominee for Broker/Dealer’s customers,
in which event all Prospectuses, proxy statements, periodic reports,
and
other printed material will be sent to Broker/Dealer, and all
confirmations and other communications to shareholders will be transmitted
to Broker/Dealer. Broker/Dealer shall be responsible for forwarding
such
printed material, confirmations, and communications, or the information
contained therein, to all customers for whom Broker/Dealer holds
such
shares as nominee. However, the Transfer Agent or the Company shall
be
responsible for the reasonable costs associated with Broker/Dealer
forwarding such printed material, confirmations, and communications
and
shall reimburse Broker/Dealer in full for such costs. Broker/Dealer
shall
also be responsible for complying with all reporting and tax withholding
requirements with respect to the customers for whose account Broker/Dealer
is holding such shares. With respect to customers other than such
customers identified in this Section 2(b), Broker/Dealer shall provide
ADI
with all information (including, without limitation, certification
of TINs
and back-up withholding instructions) necessary or appropriate for
ADI to
comply with any legal and regulatory reporting
requirements.
|
| (c) |
Accounts
opened or maintained pursuant to the networking system of NSCC will
be
governed by applicable NSCC rules and procedures, and any agreement
or
other arrangement with ADI relating to
networking.
|
3
| 3. |
Broker/Dealer
Compensation.
|
| (a) |
Broker/Dealer
concession, if any, on Broker/Dealer’s sales of shares of a Fund will be
offered as described in the then-current Prospectus or in the applicable
schedule of concessions issued by ADI and in effect at the time of
ADI
sale to Broker/Dealer. Upon written notice to Broker/Dealer, ADI,
or a
Fund, may change or discontinue any schedule of concessions, or issue
a
new schedule. Broker/Dealer may be deemed to be an underwriter in
connection with sales by Broker/Dealer of shares of a Fund where
Broker/Dealer receives all or substantially all of the sales charge
as set
forth in the then-current Prospectus and, therefore, Broker/Dealer
may be
subject to applicable provisions of the Securities Act of 1933, as
amended. Compensation paid, if any, pursuant to a Plan for the sale
of
certain class of a Fund’s shares is described in Agreement Fee Schedule
(“Fee Schedule”) attached hereto and in such respective Fund’s
then-current Prospectus.
|
| (b) |
ADI
is entitled to, if any, a contingent deferred sales charge (“CDSC”) on
redemptions of applicable class of shares of a Fund, as described
in the
then-current Prospectus.
|
| (c) |
In
the case of a Fund or class thereof which has adopted a Plan, ADI
may
elect from time to time to make payments to Broker/Dealer as provided
under such Plan for such services, and without limitation, some or
all of
the following: (i) answering inquires regarding a Fund, processing
purchases and redemption transactions, assistance in changing account
designation and addresses; providing periodic statements, personal
services to investors, and/or other services related to the maintenance
of
shareholder records and; (ii) services that ADI reasonably may request,
to
the extent permitted by applicable statute, rule, or regulation to
provide
administrative, distribution, or marketing services in the promotion
of a
Fund’s shares. Any such payments shall be made in the amount and manner
set forth in the applicable Fee Schedule or in the then-current
Prospectus. The Fee Schedule may be discontinued or changed by ADI
from
time to time and shall be in effect with respect to a Fund which
has a
Plan and so long as such Fund(s)’ Plan remains in effect. Notwithstanding
the foregoing, Broker/Dealer acknowledges that any compensation to
be paid
to the Broker/Dealer by ADI is paid from proceeds paid to ADI by
a Fund
pursuant to its Plan, and to the extent ADI does not receive such
proceeds, for any reason, the amounts payable to Broker/Dealer will
be
reduced accordingly. In the case of a Fund or class thereof that
has no
currently effective Plan, ADI or Company may, to the extent permitted
by
applicable law, elect to make payments to Broker/Dealer from either’s own
resources.
|
| (d) |
Broker/Dealer
shall furnish to ADI or the Company, on behalf of a Fund, such information
in writing as shall reasonably be requested by the Company’s Board of
Directors/Trustees (“Company’s Board”) with respect to the fees paid to
Broker/Dealer pursuant to this Agreement.
|
| (e) |
In
the event that Rule 2830 of the NASD Conduct Rules precludes a Fund
or
class thereof from imposing, or ADI from receiving, a sales charge
(as
defined in Rule 2830) or any portion thereof, Broker/Dealer shall
not be
entitled to any payments from ADI hereunder from the date that a
Fund or
class thereof discontinues or is required to discontinue imposition
of
some or all of its sales charges. If a Fund or class thereof resumes
imposition of some or all of its sales charge, Broker/Dealer will
be
entitled to payments hereunder or as modified by ADI, if
applicable.
|
| (f) |
ADI
may discontinue paying compensation to Broker/Dealer if, at any time,
(i)
Broker/Dealer is not appropriately registered in all capacities necessary
to receive such compensation or (ii) Broker/Dealer breaches any
representation, warranty or covenant contained in this Agreement,
as
determined by ADI in its sole discretion. Notwithstanding the foregoing,
Broker/Dealer shall not be entitled to any compensation in respect
of a
sale to any investor if ADI determines that another authorized selling
agent of ADI is primarily responsible for or should otherwise be
credited
with such sale. In making this determination, ADI will endeavor to
act
fairly. Any dispute regarding compensation shall be conclusively
resolved
by ADI.
|
4
EXHIBIT
(e.2)
| (g) |
If,
within seven business days after confirmation by ADI of Broker/Dealer’s
original purchase order for shares of a Fund, such shares are repurchased
by the issuing Fund or by ADI for the account of such Fund or are
tendered
for redemption by the customer, Broker/Dealer shall promptly refund
to ADI
the full discount retained by Broker/Dealer on the original sale
and any
distribution and service payments made to Broker/Dealer. Broker/Dealer
shall refund to the Transfer Agent immediately upon receipt the amount
of
any dividends or distributions paid to Broker/Dealer as nominee for
Broker/Dealer’s customers with respect to redeemed or repurchased Fund’s
shares to the extent that the proceeds of such redemption or repurchase
may include the dividends or distributions payable on such shares.
Broker/Dealer shall be notified by ADI of such repurchase or redemption
within ten days of such repurchase or
redemption.
|
| (h) |
The
provisions of the Distribution Agreement between the Company and
ADI,
insofar as they relate to a Plan, are incorporated herein by reference.
The provisions under this Agreement, relating to a Plan, shall continue
in
full force and effect only so long as the continuance of a Plan and
the
provisions of this Agreement are approved at least annually by a
vote of
the Company’s Board, including a majority of the Company’s Board who are
not interested persons of the Company and who have no direct or indirect
financial interest in the operation of the Plan or in any agreements
related to a Plan, cast in person at a meeting called for the purpose
of
voting thereon.
|
| (i) |
The
provisions regarding Broker/Dealer compensation may be terminated
by the
vote of a majority of the Company’s Board who are not interested persons
of the Company and who have no direct or indirect financial interest
in
the operation of a Plan or in any agreements related to a Plan, or
by a
vote of a majority of a Fund’s outstanding shares, on sixty (60) days’
written notice, without payment of any penalty. Such provisions will
be
terminated also by any act that terminates this Agreement and shall
terminate automatically in the event of the assignment (as that term
is
defined in the 0000 Xxx) of this Agreement unless agreed to in writing
by
the parties.
|
After
the
effective date of any change in or discontinuance of any schedule of
concessions, distribution payments, or service payments, or the termination
of a
Plan, such concessions, distribution payments, or service payments will be
allowable or payable to Broker/Dealer only in accordance with such change,
discontinuance, or termination. Broker/Dealer agrees that Broker/Dealer will
have no claim against ADI, the Company, or a Fund by virtue of any such change,
discontinuance, or termination. In the event of any overpayment by ADI of
any
concession, distribution payment, or service payment, Broker/Dealer will
promptly remit such overpayment.
| (j) |
This
Agreement’s applicable provisions, regarding compensation, if any, have
been adopted pursuant to Rule 12b-1 under the 1940 Act by a Fund’s class
that may have adopted a Plan, under its respective
Plan.
|
| 4. |
Status
as Financial Intermediaries.
|
|
(a)
|
Broker/Dealer
represents and warrants that Broker/Dealer is and will remain a
member in
good standing of the National Association of Securities Dealers,
Inc.
("NASD"), and agrees to abide by all of its rules and regulations
including its Rules of Conduct. Broker/Dealer further agrees to
comply
with all applicable state and federal laws and rules and regulations
of
regulatory agencies having jurisdiction. Reference is hereby specifically
made to Section 2830 of the Conduct Rules of the NASD, which is
incorporated herein by reference. The termination of Broker/Dealer’s
membership in the NASD or any breach of said Section 2830 will
immediately
and automatically terminate this Agreement. Broker/Dealer further
represents that Broker/Dealer is qualified to act as a broker/dealer
in
the states where Broker/Dealer transacts business. Broker-Dealer
further
agrees that, in making any sales to purchasers within the United
States of
securities acquired from ADI or the Company, Broker/Dealer will
conform to
the provisions of paragraphs (a) and (b) of Rule 2420 of the NASD’s
Conduct Rules.
|
5
|
(b)
|
Broker/Dealer
represents that Broker/Dealer is qualified to sell shares in the
various
jurisdiction where it transacts business. Broker/Dealer represents
that it
and all of its personnel involved in the activities contemplated
hereunder
have all governmental, regulatory, and self-regulatory registrations,
approvals, memberships, and licenses required to perform Broker/Dealer’s
obligations under this Agreement and to receive compensation, if
any,
therefore, and Broker/Dealer will maintain all relevant registrations,
approvals, memberships, and licenses during the term of this
Agreement.
|
|
(c)
|
Nothing
in this Agreement shall cause Broker/Dealer to be ADI’s partner, employee,
or agent, or give Broker/Dealer any authority to act for ADI, the
Company,
or a Fund. Neither ADI nor the Company shall be liable for any
of
Broker/Dealer’s acts or obligations under this
Agreement.
|
| 5. |
Information
Relating to the Funds.
|
| (a) |
No
person is authorized to make any representations concerning a Fund’s
shares except those contained in such Fund’s then-current Prospectus, and
in buying shares from ADI or selling shares to ADI hereunder,
Broker/Dealer shall rely solely on the representations contained
in the
then-current Prospectus. Upon Broker/Dealer’s request, ADI will furnish
Broker/Dealer with a reasonable number of copies of a Fund’s then-current
Prospectus(es) and/or SAIs (including any supplements
thereto).
|
| (b) |
Broker/Dealer
may not use any sales literature or advertising material (including
material disseminated through radio, television, or other electronic
media) concerning a Fund’s shares, other than a Fund’s then-current
Prospectus or such printed information that is given to Broker/Dealer
by
ADI, without first obtaining ADI’s written approval. Broker/Dealer shall
not distribute or make available to the general public any printed
information furnished by ADI which is marked “FOR INVESTMENT ADVISER USE
ONLY” or “FOR INVESTMENT PROFESSIONAL USE ONLY” or which otherwise
indicates that it is confidential or not intended to be distributed
to the
general public.
|
| 6. |
Indemnification.
ADI and Broker/Dealer (each an “Indemnifying Party”) will indemnify and
hold the other party and its directors/trustees, officers, employees,
and
agents harmless from any claim, demand, loss, expense (including
reasonable attorney’s fees), or cause of action resulting from the willful
misconduct or negligence, as measured by industry standards, of the
Indemnifying Party, its agents, and employees, in carrying out its
obligations under this Agreement. This provision will survive the
termination of this Agreement.
|
Broker/Dealer
shall indemnify, hold harmless and reimburse the Company and each of its
affiliates, directors, officers, employees and agents for, from and against
any
and all losses, claims, liabilities and expenses (including, but not limited
to,
reasonable attorney’s fees) incurred by any of them and arising out of, relating
to or based upon: (i) Broker/Dealer’s gross negligence, willful misconduct or
violation of applicable law, regulation or rule of a self-regulatory
organization to which it is subject in the performance of, or failure to
perform, its duties and obligations under this Agreement; (ii) any breach
by
Broker/Dealer of this Agreement or any representation, warranty, covenant
or
agreement made by it in this Agreement; (iii) Broker/Dealer’s failure to
transmit an order or from any errors contained in any order submitted or
instructions given by Broker/Dealer; or (iv) any claim relating to the use
of
advertising or marketing material prepared by Broker/Dealer that was (a)
not
published or provided to Broker/Dealer by ADI or the Funds or (b) if published
or provided to Broker/Dealer by ADI or the Funds, not accurately derived
by
Broker/Dealer from such advertising or marketing material.
6
EXHIBIT
(e.2)
| 7. |
Duration.
This Agreement, with respect to each Plan, will continue in effect
for one
year from its effective date, and thereafter will continue automatically
for successive annual periods; provided, however, that such continuance
is
subject to termination at any time without penalty if a majority
of the
Company’s Directors/Trustees who are not interested persons (as defined in
the 1940 Act), or a majority of the outstanding shares of a Fund,
vote to
terminate or not to continue a Plan. This Agreement, other than with
respect to a terminated Plan, will continue in effect from year to
year
after its effective date, unless terminated as provided
herein.
|
| 8. |
Amendment
and Termination of Agreement. Either
party to this Agreement may terminate the Agreement without cause
by
giving the other party at least thirty (30) days’ written notice of its
intention to terminate. This Agreement will automatically terminate
in the
event of its assignment (as defined in the 1940 Act). ADI may change
or
amend any provision of this Agreement by giving Broker/Dealer written
notice of the change or amendment.
|
| 9. |
Arbitration.
In
the event of a material dispute under this Agreement, such dispute
shall
be settled by arbitration before arbitrators sitting in Denver, Colorado,
in accordance with the NASD’s Code of Arbitration Procedures in effect at
the time of the dispute. The arbitrators shall act by majority decision,
and their award may allocate attorneys’ fees and arbitration costs between
ADI and Broker/Dealer. The arbitrators’ award shall be final and binding
between the parties, and such award may be entered as a judgment
in any
court of competent jurisdiction.
|
| 10. |
Notices.
All
notices required or permitted to be given under this Agreement shall
be
given in writing and delivered by personal delivery, by postage prepaid
mail, or by facsimile or a similar means of same day delivery (with
a
confirming copy by mail). All notices to ADI shall be given or sent
to ADI
at ADI offices located at 0000 Xxxxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx
00000, Attn: General Counsel. All notices to Broker/Dealer shall
be given
or sent to Broker/Dealer at the address specified by Broker/Dealer
herein.
Each party may change the address to which notices shall be sent
by giving
notice to the other party in accordance with this
paragraph.
|
| 11. |
Client
Information
|
a. Agreement
to Provide Information.
Broker/Dealer agrees to provide the Fund, upon written request, the taxpayer
identification number (“TIN”), the Individual/International Taxpayer
Identification Number (“ITIN”), or other government-issued identifier (“GII”),
if known, of any or all Shareholder(s) of the account and the amount, date,
name
or other identifier of any investment professional(s) associated with the
Shareholder(s) or account (if known), and transaction type (purchase,
redemption, transfer, or exchange) of every purchase, redemption, transfer,
or
exchange of Shares held through an account maintained by the Broker/Dealer
during the period covered by the request.
7
(i) Period
Covered by Request.
Requests must set forth a specific period, not to exceed 180 calendar days
from
the date of the request, for which transaction information is sought. The
Fund
may request transaction information older than 180 calendar days from the
date
of the request as it deems necessary to investigate compliance with policies
established by the Fund for the purpose of eliminating or reducing any dilution
of the value of the outstanding Shares issued by the Fund.
(ii) Form
and Timing of Response.
(a)
Broker/Dealer agrees to provide, promptly upon request of the Fund or its
designee, the requested information specified in Section 11(a). If requested
by
the Fund or its designee, Broker/Dealer agrees to use best efforts to determine
promptly whether any specific person about whom it has received the
identification and transaction information specified in Section 11(a) is
itself
a financial intermediary (“Indirect Intermediary”) and, upon further request of
the Fund or its designee, promptly either (i) provide (or arrange to have
provided) the information set forth in Section 11(a) for those Shareholders
who
hold an account with an Indirect Intermediary or (ii) restrict or prohibit
the
Indirect Intermediary from purchasing, in nominee name on behalf of other
persons, securities issued by the Fund. Broker/Dealer additionally agrees
to
inform the Fund whether it plans to perform (i) or (ii).
(b)
Responses required by this paragraph must be communicated in writing and
in a
format mutually agreed upon by the parties.
(c)
To
the extent practicable, the format for any transaction information provided
to
the Fund should be consistent with the NSCC Standardized Data Reporting
Format.
(iii) Limitations
on Use of Information.
The
Fund agrees not to use the information received for marketing or any other
similar purpose without the prior written consent of the
Broker/Dealer.
b. Agreement
to Restrict Trading.
Broker/Dealer agrees to execute written instructions from the Fund to restrict
or prohibit further purchases or exchanges of Shares by a Shareholder that
has
been identified by the Fund as having engaged in transactions of the Fund’s
Shares (directly or indirectly through the Broker/Dealer’s account) that violate
policies established or utilized by the Fund for the purpose of eliminating
or
reducing any dilution of the value of the outstanding Shares issued by the
Fund.
(i) Form
of Instructions.
Instructions between the parties to restrict or prohibit further purchases
or
exchanges of Fund Shares must include the TIN, ITIN, or GII, if known, and
the
specific restriction(s) to be executed. If the TIN, ITIN, or GII is not known,
the instructions must include an equivalent identifying number of the
Shareholder(s) or account(s) or other agreed upon information to which the
instruction relates.
(ii) Timing
of Response.
Broker/Dealer agrees to execute instructions as soon as reasonably practicable,
but not later than five business days after receipt of the instructions by
the
Broker/Dealer.
8
EXHIBIT
(e.2)
(iii) Confirmation
by Broker/Dealer.
Broker/Dealer must provide written confirmation to the Fund that instructions
have been executed. Broker/Dealer agrees to provide confirmation as soon
as
reasonably practicable, but not later than ten business days after the
instructions have been executed.
c. Definitions.
For
purposes of this Agreement:
(i) Pursuant
to Section 11, and only Section 11 herein, the term “Fund” also includes the
Fund’s principal underwriter and transfer agent. The term does not include any
“excepted funds” as defined in SEC Rule 22c-2(b) under the 0000
Xxx.
(ii) The
term
“Shares” means the interest of Shareholders corresponding to the redeemable
securities of record issued by the Fund under the 1940 Act that are held
by the
Broker/Dealer.
(iii) The
term
“Shareholder” means the beneficial owner of Shares, whether the Shares are held
directly or by the Broker/Dealer in nominee name.
(iv) The
term
“written” includes electronic writings and facsimile transmissions.
(v) The
term
“Broker/Dealer” shall mean a “financial intermediary” as defined in SEC Rule
22c-2.
(vi) The
term
“purchase” does not include automatic reinvestment of dividends.
(vii) The
term
“promptly” as used in Section 11(a)(ii) shall mean as soon as practicable but in
no event later than 5 business days from the Broker/Dealer’s receipt of the
request for information from the Fund or its designee.
| 12. |
Anti-Money
Laundering Program.
Broker/Dealer hereby certifies that: (i) it understands that pursuant
to
various U.S. regulations, it is required to establish an anti-money
laundering program, which satisfies the requirements of Title III
of the
Uniting and Strengthening America by Providing Appropriate Tools
Required
to Intercept and Obstruct Terrorism Act of 2001 (the “USA Patriot Act”);
(ii) Broker/Dealer has developed, implemented, and will maintain
such an
anti-money laundering program, including a customer identification
program
consistent with the rules under sec. 326 of the USA Patriot Act,
and will
comply with all applicable laws and regulations designed to guard
against
money laundering activities set out in such program; (iii) Broker/Dealer
will cooperate with ADI and deliver information reasonably requested
by
ADI concerning shareholders that purchased a Fund’s shares sold by
Broker/Dealer necessary for ADI or the Company to comply with the
USA
Patriot Act; and (iv) Broker/Dealer will notify ADI, in writing,
if it is
found, by its Compliance Officer, independent anti-money laundering
auditor, or any Federal, state, or self-regulatory agencies, to be
in
violation of the USA Patriot Act, any regulation implementing the
USA
Patriot Act, or its anti-money laundering
program.
|
Notwithstanding
anything to the contrary, if Broker/Dealer is exempt from the requirement
to
develop, implement, and maintain anti-money laundering policies that comply
with
USA Patriot Act in which case Broker/Dealer agrees to cooperate with ADI
or the
Company and deliver information reasonably requested by ADI or the Company
concerning shareholders that purchased shares sold by Broker/Dealer necessary
for ADI and the Company to comply with either’s internal policies, the USA
Patriot Act and relevant rules and regulations.
9
Broker/Dealer
acknowledges that ADI or the Company may reject or refuse orders for the
sale of
shares with respect to customers for which Broker/Dealer serves as nominee
if
Broker/Dealer has not adopted and does not implement anti-money laundering
policies and procedures as required by the USA Patriot Act.
| 13. |
Regulation
S-P. In
accordance with Regulation S-P, if non-public personal information
regarding customers/shareholders is disclosed to either party in
connection with this Agreement, the party receiving such information
will
not disclose or use that information other than as necessary to carry
out
the purposes of this Agreement. Any privacy notice that Broker/Dealer
delivers to customers/shareholders will comply with Title V of the
Xxxxx-Xxxxx-Xxxxxx Act and Regulations S-P, as each may be amended,
and
will notify customers that non-public personal information may be
provided
to financial service providers such as security broker-dealers or
investment companies and as permitted by law. This provision will
survive
the termination of this Agreement.
|
| 14. |
Entire
Agreement. This
Agreement constitutes the entire agreement and understanding between
the
parties hereto and supersedes all prior agreements between the parties,
whether oral or written, relating to the sale of shares or any other
subject covered by this Agreement.
|
| 15. |
Partial
Invalidity. If
any provision of this Agreement shall be held or made invalid by
a court
decision, statute, rule, or otherwise, the remainder of the Agreement
shall not be affected thereby. Furthermore, in the event of any
inconsistency between the Agreement and the then-current Prospectus,
the
terms of the then-current Prospectus shall
control.
|
| 16. |
Waiver.
Failure
of ADI or the Company to terminate this Agreement upon the occurrence
of
any event set forth in this Agreement as a cause for termination
shall not
constitute a waiver of the right to terminate this Agreement at a
later
time on account of such occurrence or any succeeding breach of the
same.
|
| 17. |
Heading.
The
captions in this Agreement are included for convenience of reference
only
and in no way define or limit any of the provisions of this
Agreement.
|
| 18. |
Applicable
Law. This
Agreement shall be construed in accordance with the laws of the state
of
Colorado, without giving effect to principles of conflicts of
law.
|
| 19. |
Effective
Date.
This Agreement shall become effective as of the date when it is accepted
and dated below by ADI.
|
[Remainder
of page left intentionally blank.]
10
EXHIBIT
(e.2)
IN
WITNESS WHEREOF, the Parties’ authorized representatives have executed this
Agreement and represent that they have read and understood the obligations
herein and agree to be bound by the Agreement’s terms and
conditions.
ACCEPTED
AND AGREED:
BROKER/DEALER
Signature:
_______________________________
Name:
__________________________________
Title:
___________________________________
Address:
________________________________
| NSCC Dealer # ____________________________ | Fax Number: _____________________________ | |
| NSCC Dealer Alpha Code ____________________ | Date: __________________________________ | |
| NSCC Clearing ____________________________ |
Mutual Fund Coordinator/
Primary Contact: __________________________ |
|
| Phone Number: ____________________________ |
ALPS
DISTRIBUTORS, INC.
By:
_____________________________________
Name:
___________________________________
Title:
____________________________________
Effective
Date: _____________________________
11
AGREEMENT
FEE SCHEDULE
In
consideration of sales of the Heartland Funds under the terms and conditions
of
this Agreement and the then-current prospectus, the following fee/payment
schedule shall apply:
|
Name
of Portfolio
|
12b-1
Trails
|
|
Heartland
Select Value Fund
|
0.25%
|
|
Heartland
Value Plus Fund
|
0.25%
|
|
Heartland
Value Fund
|
0.25%
|
In
accordance with each Fund’s then-current prospectus, all fees, if any, shall be
paid based on the average daily net asset value of outstanding shares held
by
shareholders receiving services described in the Agreement. Such payments
shall
be computed and paid monthly. The determination of average daily net assets
shall be made at the close of each Business Day.
12
