PILGRIM SECURITIES, INC. RETURN TO:
00 X. XXXXXXX XXX., XXXXX 0000
XXXXXXX, XX 00000-0000
(000) 000-0000 OR (000) 000-0000
SELECTED DEALER AGREEMENT
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Broker/Dealer
We are the Distributor for shares of Pilgrim Prime Rate Trust (the "Trust") that
may be issued through broker-dealers that have entered into selected dealer
agreements with us. Subject to your acceptance of the terms of this Agreement,
we hereby appoint you as a non-exclusive distributor for the sale of the shares
in the jurisdictions in which you are registered as a broker/dealer.
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1. ORDERS:
(a) Sales of shares may be made only at their applicable offering price
determined in accordance with the Trust's then current Prospectus relating
to the offering of shares through selected dealers (the "Prospectus").
(b) The procedure relating to orders and the handling and settlement thereof
will be subject to the provisions of the Trust's then current Prospectus
and such further instructions released by us from time to time. Orders
should be transmitted to our office or other offices authorized by us. You
are responsible for the accuracy, timeliness and completeness of purchase
orders that you transmit to us.
(c) All orders are subject to acceptance by us and by the Trust. We will not
accept from you any conditional orders for shares.
(d) You shall be responsible for reporting all transactions through the
Automated Confirmation Transaction Service or through any other means
required or permitted by the Rules of the National Association of
Securities Dealers, Inc. ("NASD"), and for delivering confirmations
relating to such transactions.
(e) You shall distribute the Trust's Prospectus and Statement of Additional
Information and shareholder reports to your customers in compliance with
applicable regulatory requirements.
(f) You shall provide written confirmation to us following the close of
business on any day in which shares are sold under this Agreement setting
forth, for each sale during that day, the number of shares sold, the time
of the sale, the executed sales price at which such shares were sold, and
the gross proceeds from such sale.
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2. CONCESSIONS: On each order accepted by us for shares of the Trust, you will
be entitled to receive a dealers' concession as set forth in the Trust's
then current Prospectus.
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3. SALES ACTIVITIES:
(a) You shall make no purchases except for the purpose of covering orders
received by you, or for your own bona fide investment. You agree that you
shall not withhold placing orders so as to profit from such withholding.
You also agree that it is your responsibility to determine the suitability
of the Trust's shares as investments for your customers.
(b) You agree that neither you nor any of your associated persons, as defined
in Section 3(18) of the Securities Exchange Act of 1934, is authorized to
make any representation relating to the shares of the Trust, except those
contained in the Trust's then current Prospectus and Statement of
Additional Information, which you agree to deliver to investors in
accordance with applicable regulations, and in supplemental information
that we or the Trust may issue, which is limited to sales literature
provided or approved by us, filings made with the SEC, and press releases.
We shall provide you with copies of the Prospectus, Statement of Additional
Information, reports to shareholders and available printed information in
reasonable quantities upon request.
(c) You shall not use any advertisement or sales literature with respect to the
Trust without first having obtained our approval.
(d) In no transaction shall you have any authority whatever to act as agent for
the Trust, or for us, or for any other distributor, except as provided in
this Agreement, and nothing in this Agreement shall constitute either of us
the agent of the other, or shall constitute you or the Trust the agent of
the other.
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4. REMITTANCE: Remittance by dealers should be made by check or wire, payable
to the Trust (not to us) and sent to the Trust's servicing agent identified
on Schedule A. Stock certificates, where specifically requested, will be
delivered only after checks have cleared. Payments must be received
promptly, otherwise the right is reserved, without notice, to cancel the
sale, in which event you will be held responsible for any loss to the
Trust, or to us, including loss of profit resulting from your failure to
make payment.
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5. NASD AND OTHER REGULATION: You and we agree to abide by all of the rules
and regulations of the NASD, including its Conduct Rules, as well as all
state or federal laws, rules or regulations that are now or may hereafter
become applicable to the transactions hereunder. You represent and warrant
that you are a member of the NASD. You also agree to that you will not
engage in any activity in respect of shares of the Trust in violation of
the Securities Exchange Act of 1934, as amended, including Regulation M
thereunder.
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6. INDEMNIFICATION:
(a) You agree to be liable for, to hold us, the Trust and our and the Trust's
officers, directors, trustees and employees harmless from, and to indemnify
each of them from any liabilities and costs, including but not limited to
reasonable attorneys' fees, arising from (i) your breach of your
representations or agreements made herein, (ii) any statements or
representations (other than statements or representations contained in the
Trust's current Prospectus and Statement of Additional Information or any
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other written material we have provided to you relating to the Trust) that
you or your employees make concerning the Trust; or (iii) your wrongful
conduct or alleged wrongful conduct with respect to the sale or
distribution of the Trust's shares.
(b) We agree to be liable for, to hold you, your officers, directors, and
employees harmless from and to indemnify each of them from any liabilities
and costs, including but not limited to reasonable attorneys' fees, arising
from (i) our breach of our representations or agreements made herein, or
(ii) any untrue statement of a material fact or alleged untrue statement of
a material fact contained in the Trust's Prospectus or Statement of
Additional Information or any amendment or supplement thereto, or arising
out of or based on the omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading. No indemnity herein shall apply in respect of any Prospectus or
Statement of Additional Information delivered at a time other than as
required under the 1933 Act or the regulations adopted thereunder.
(c) The provisions of this Section 6 shall survive the termination of this
agreement.
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7. 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 price or to cancel this Agreement,
which shall be construed in accordance with the laws of the State of
Arizona. This agreement may be canceled at any time by you upon thirty (30)
days' written notice.
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8. ACCEPTANCE OF TERMS: 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 earlier of our receipt of a signed copy hereof or the
first order placed by you for any of the Trust's shares, which order shall
constitute acceptance of this Agreement. All amendments to this Agreement
shall take effect as of the date of the first order placed by you for the
Trust's shares after the date set forth in the notice of amendment sent to
you by the undersigned.
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DEALER'S ACCEPTANCE
----------------------------- PILGRIM SECURITIES, INC.
Firm Name
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Address
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Phone Number By
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By
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Authorized Officer Signature
By
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Authorized Officer Name - Please Print
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Date
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SCHEDULE A
The Trust's servicing agent is:
[to be provided]
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