SALES AGREEMENT
covering shares of capital stock
and/or shares of beneficial interest of
THE XXXXXXXX MUTUAL FUNDS
Xxxxxxxx Capital Fund, Inc.
Xxxxxxxx Common Stock Fund, Inc.
Xxxxxxxx Communications and Information Fund, Inc.
Xxxxxxxx Frontier Fund, Inc.
Xxxxxxxx Growth Fund, Inc.
Xxxxxxxx Xxxxxxxxx Global Fund Series, Inc.
Xxxxxxxx High Income Fund Series
Xxxxxxxx Income Fund, Inc.
Xxxxxxxx Municipal Fund Series, Inc.
Xxxxxxxx Municipal Series Trust
Xxxxxxxx New Jersey Municipal Fund, Inc.
Xxxxxxxx Pennsylvania Municipal Fund Series
Xxxxxxxx Value Fund Series, Inc.
between
XXXXXXXX FINANCIAL SERVICES, INC.
and
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Dealer
The Dealer named above and Xxxxxxxx Financial Services, Inc., exclusive agent
for distribution of shares of capital stock of Xxxxxxxx Capital Fund, Inc.,
Xxxxxxxx Common Stock Fund, Inc., Xxxxxxxx Communications and Information Fund,
Inc., Xxxxxxxx Frontier Fund, Inc., Xxxxxxxx Growth Fund, Inc., Xxxxxxxx
Xxxxxxxxx Global Fund Series, Inc., Xxxxxxxx Income Fund, Inc., Xxxxxxxx
Municipal Fund Series, Inc., and Xxxxxxxx New Jersey Municipal Fund, Inc., and
shares of beneficial interest of Xxxxxxxx High Income Fund Series, Xxxxxxxx
Municipal Series Trust, Xxxxxxxx Pennsylvania Municipal Fund Series, and
Xxxxxxxx Value Fund Series, Inc., agree to the terms and conditions set forth in
this agreement.
Dealer Signature Xxxxxxxx Financial Services, Inc.
Acceptance
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Principal Officer Xxxxxxx X. Xxxxxxx, President
XXXXXXXX FINANCIAL SERVICES, INC.
000 Xxxx Xxxxxx
---------------------------------- Xxx Xxxx, Xxx Xxxx 00000
Address
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Employer Identification No. Date
REV 4/97
The Dealer and Xxxxxxxx Financial Services, Inc. ("Xxxxxxxx Financial
Services"), as exclusive agent for distribution of Class A and Class D Shares
(as described in the "Policies and Procedures," as set forth below) of the
Capital Stock and/or Class A and Class D Shares of beneficial interest
(collectively, the "Shares") of Xxxxxxxx Capital Fund, Inc., Xxxxxxxx Common
Stock Fund, Inc., Xxxxxxxx Communications and Information Fund, Inc., Xxxxxxxx
Frontier Fund, Inc., Xxxxxxxx Growth Fund, Inc., Xxxxxxxx Xxxxxxxxx Global Fund
Series, Inc., Xxxxxxxx High Income Fund Series, Xxxxxxxx Income Fund, Inc.,
Xxxxxxxx Municipal Fund Series, Inc., Xxxxxxxx Municipal Series Trust, Xxxxxxxx
New Jersey Municipal Fund, Inc., Xxxxxxxx Pennsylvania Municipal Fund Series,
and Xxxxxxxx Value Fund Series, Inc., and or any other mutual fund for which
Xxxxxxxx Financial Services is exclusive agent for distribution (herein called
the Funds), agree as follows:
1. The Dealer agrees to comply with the attached "Policies and Procedures"
with respect to sales of Xxxxxxxx Mutual Funds offering two classes of
shares, as set forth below.
2. An order for Shares of one or more of the Funds, placed by the Dealer
with Xxxxxxxx Financial Services, will be confirmed at the public
offering price as described in each Fund's current prospectus. Unless
otherwise agreed when an order is placed, the Dealer shall remit the
purchase price to the Fund, or Funds, with issuing instruction, within
the period of time prescribed by existing regulations. No wire orders
under $1,000 may be placed for initial purchases.
3. Shares of the Funds shall be offered for sale and sold by the Dealer
only at the applicable public offering price currently in effect,
determined in the manner prescribed in each Fund's prospectus. Xxxxxxxx
Financial Services will make a reasonable effort to notify the Dealer
of any redetermination or suspension of the current public offering
price, but Xxxxxxxx Financial Services shall be under no liability for
failure to do so.
4. On each purchase of Shares by the Dealer, the Dealer shall be entitled,
based on the Class of Shares purchased and except as provided in each
Fund's current prospectus, to a concession determined as a percentage
of the price to the investor as set forth in each Fund's current
prospectus. On each purchase of Class A Shares, Xxxxxxxx Financial
Services reserves the right to receive a minimum concession of $.75 per
transaction. No concessions will be paid to the Dealer for the
investment of dividends in additional shares.
5. Except for sales to and purchases from the Dealer's retail customers,
all of which shall be made at the applicable current public offering
price or the current price bid by Xxxxxxxx Financial Services on behalf
of the Fund, the Dealer agrees to buy Shares only through Xxxxxxxx
Financial Services and not from any other sources and to sell shares
only to Xxxxxxxx Financial Services, the Fund or its redemption agent
and not to any other purchasers.
6. By signing this Agreement, both Xxxxxxxx Financial Services and the
Dealer warrant that they are members of the National Association of
Securities Dealers, Inc., and agree that termination of such membership
at any time shall terminate this Agreement forthwith regardless of the
provisions of paragraph 10 hereof. Each party further agrees to comply
with all rules and regulations of such Association and specifically to
observe the following provisions:
(a) Neither Xxxxxxxx Financial Services nor the Dealer shall
withhold placing customers' orders for Shares so as to profit
itself as a result of such withholding.
(b) Xxxxxxxx Financial Services shall not purchase Shares from any
of the Funds except for the purpose of covering purchase
orders already received, and the Dealer shall not purchase
Shares of any of the Funds through Xxxxxxxx Financial Services
other than for investment, except for the purpose of covering
purchase orders already received.
(c) Xxxxxxxx Financial Services shall not accept a conditional
order for Shares on any basis other than at a specified
definite price. The Dealer shall not, as principal, purchase
Shares of any of the Funds from a recordholder at a price
lower than the bid price, if any, then quoted by or for the
Fund, but the Dealer shall not be prevented from selling
Shares for the account of a record owner to Xxxxxxxx Financial
Services, the Fund or its redemption agent at the bid price
currently quoted by or for such Fund, and charging the
investor a fair commission for handling the transaction.
(d) If Class A Shares are repurchased by a Fund or by Xxxxxxxx
Financial Services as its agent, or are tendered for
redemption within seven business days after confirmation by
Xxxxxxxx Financial Services of the original purchase order of
the Dealer for such Shares, (i) the Dealer shall forthwith
refund to Xxxxxxxx Financial Services the full concession
allowed to the Dealer on the original sales and (ii) Xxxxxxxx
Financial Services shall forthwith pay to the Fund Xxxxxxxx
Financial Services' share of the "sales load" on the original
sale by Xxxxxxxx Financial Services, and shall also pay to the
Fund the refund which Xxxxxxxx Financial Services received
under (i) above. The Dealer shall be notified by Xxxxxxxx
Financial Services of such repurchase or redemption within ten
days of the date that such redemption or repurchase is placed
with Xxxxxxxx Financial Services, the Fund or its authorized
agent. Termination or cancellation of this Agreement shall not
relieve the Dealer or Xxxxxxxx Financial Services from the
requirements of this clause (d).
7. (a) Xxxxxxxx Financial Services shall be entitled to a contingent
deferred sales load ("CDSL") on redemptions within one year of
purchase on any Class D Shares sold. With respect to omnibus
accounts in which Class D Shares are held at Xxxxxxxx Data
Corp. ("SDC") in the Dealer's name, the Dealer agrees that by
the tenth day of each month it will furnish to SDC a report of
each redemption in the preceding month to which a CDSL was
applicable, accompanied by a check payable to Xxxxxxxx
Financial Services in payment of the CDSL due.
(b) If, with respect to a redemption of any Class D Shares sold by
the Dealer, the CDSL is waived because the redemption
qualifies for a waiver set forth in the Fund's prospectus, the
Dealer shall promptly remit to Xxxxxxxx Financial Services an
amount equal to the payment made by Xxxxxxxx Financial
Services to the Dealer at the time of sale with respect to
such Class D Shares.
8. In all transactions between Xxxxxxxx Financial Services and the Dealer
under this Agreement, the Dealer will act as principal in purchasing
from or selling to Xxxxxxxx Financial Services. The dealer is not for
any purposes employed or retained as or authorized to act as broker,
agent or employee of any Fund or of Xxxxxxxx Financial Services and the
Dealer is not authorized in any manner to act for any Fund or Xxxxxxxx
Financial Services or to make any representations on behalf of Xxxxxxxx
Financial Services. In purchasing and selling Shares of any Fund under
this Agreement, the Dealer shall be entitled to rely only upon matters
stated in the current offering prospectus of the applicable Fund and
upon such written representations, if any, as may be made by Xxxxxxxx
Financial Services to the Dealer over the signature of Xxxxxxxx
Financial Services.
9. Xxxxxxxx Financial Services will furnish to the Dealer, without charge,
reasonable quantities of the current offering prospectus of each Fund
and sales material issued from time to time by Xxxxxxxx Financial
Services.
10. Either Party to this Agreement may cancel this Agreement by written
notice to the other party. Such cancellation shall be effective at the
close of business on the 5th day following the date on which such
notice was given. Xxxxxxxx Financial Services may modify this Agreement
at any time by written notice to the Dealer. Such notice shall be
deemed to have been given on the date upon which it was either
delivered personally to the other party or any officer or member
thereof, or was mailed postage-paid, or delivered to a telegraph office
for transmission to the other party at his or its address as shown
herein.
11. This Agreement shall be construed in accordance with the laws of the
State of New York and shall be binding upon both parties hereto when
signed by Xxxxxxxx Financial Services and by the Dealer in the spaces
provided on the cover of this Agreement. This Agreement shall not be
applicable to Shares of a Fund in a state in which such Fund Shares are
not qualified for sale.
POLICIES AND PROCEDURES
In connection with the offering by the Funds of three classes of
shares, one subject to a front-end sales load and a service fee ("Class A
Shares"), one subject to a service fee, a distribution fee, no front-end sales
load and a contingent deferred sales load on redemptions within six years of
purchase ("Class B Shares") and one subject to a service fee, a distribution
fee, no front-end sales load and a contingent deferred sales load on redemptions
within one year of purchase ("Class D Shares"), it is important for an investor
to choose the method of purchasing shares which best suits his or her particular
circumstances. To assist investors in these decisions, Xxxxxxxx Financial
Services has instituted the following policies with respect to orders for
Shares:
1. No purchase order may be placed for Class B Shares or Class D
Shares for amounts of $4,000,000 or more.
2. Any purchase order for less than $4,000,000 may be for either
Class A, Class B or Class D Shares in light of the relevant
facts and circumstances, including:
a. the specific purchase order dollar amount;
b. the length of time the investor expects to hold his
Shares; and
c. any other relevant circumstances such as the
availability of purchases under a Letter of Intent,
Volume Discount, or Right of Accumulation.
There are instances when one method of purchasing Shares may be more
appropriate than another. For example, an investor who would qualify for a
significant discount from the maximum sales load on Class A Shares may determine
that payment of such a reduced front-end sales load and service fee is
preferable to payment of higher ongoing distribution fee. On the other hand, an
investor whose order would not qualify for such a discount may wish to have all
of his or her funds invested in Class B or Class D Shares. An investor who
expects to hold his or her shares for longer than eight years might prefer Class
B Shares over Class D Shares because of the conversion feature; once the Class B
Shares have converted to Class A Shares, the ongoing distribution fees will be
reduced. Class D Shares may remain a more attractive choice for shorter-term
investors because of the contingent deferred sales load on such shares is only
1%, and it does not apply if the investor owns his or her shares for at least
one year. If an investor anticipates that he or she will redeem his or her Class
B Shares or Class D Shares while still subject to a contingent deferred sales
charge, the investor may, depending on the amount of the purchase, pay an amount
greater than the sales load and service fee attributable to Class A Shares.
Appropriate supervisory personnel within your organization must ensure
that all employees receiving investor inquiries about the purchase of Shares of
a Fund advise the investor of then available pricing structures offered by the
Fund, and the impact of choosing one method over another. In some instances it
may be appropriate for a supervisory person to discuss a purchase with the
investor.
Questions relating to this policy should be directed to Xxxxxxx X.
Xxxxxxx, President, Xxxxxxxx Financial Services at (000) 000-0000.
ADDENDUM
TO
SALES/BANK AGREEMENT
covering shares of capital stock or shares of beneficial interest of
the Xxxxxxxx Mutual Funds
between
XXXXXXXX ADVISORS, INC.
and
DEALER/BANK
Dear Dealer/Bank:
Your Sales/Bank Agreement with Xxxxxxxx Advisors, Inc. (formerly,
Xxxxxxxx Financial Services, Inc.) ("SAI") is hereby amended to include the
following provisions in connection with the offering by the Xxxxxxxx Mutual
Funds of Class B shares* and Class C shares as described in each Fund's
prospectus, as applicable:
1. Dealer/Bank agrees to comply with the attached "Policies and
Procedures" with respect to sales of Xxxxxxxx Mutual Funds.
2. SAI shall be entitled to a contingent deferred sales load ("CDSL") on
redemptions within six years of purchase on any Class B shares sold,
within eighteen months of purchase on any Class C shares sold and
within one year of purchase on any Class D shares sold. SAI shall also
be entitled to a CDSL on redemptions within eighteen months of purchase
on any Class A shares sold at net asset value due to the size of the
purchase. With respect to omnibus accounts in which Class A shares,
Class B shares, Class C shares or Class D shares are held at Xxxxxxxx
Data Corp. ("SDC") in the Dealer/Bank's name, the Dealer/Bank agrees
that by the tenth day of each month it will furnish to SDC a report of
each redemption in the preceding month to which a CDSL was applicable,
accompanied by a check payable to SAI in payment of the CDSL due.
3. If, with respect to a redemption of any Class A shares, Class B shares,
Class C shares or Class D shares sold by the Dealer/Bank, the CDSL is
waived because the redemption qualifies for a waiver as set forth in
the Fund's prospectus or statement of additional information, the
Dealer/Bank shall remit to SAI promptly upon notice an amount equal to
the payment or a portion of the payment made by SAI to the Dealer/Bank
at the time of sale with respect to such Class A shares, Class B
shares, Class C shares or Class D shares.
4. On each purchase of Shares by the Dealer/Bank, the Dealer/Bank shall be
entitled, based on the Class of Shares purchased and except as provided
in each Fund's current prospectus, to a concession determined as a
percentage of the price to the investor as set forth in each Fund's
current prospectus. No concessions will be paid to the Dealer/Bank for
the investment of dividends in additional shares.
5. The Dealer/Bank will comply in all respects with Notice to Members
95-80 of the National Association of Securities Dealers, Inc. regarding
member's obligations and responsibilities regarding mutual fund sales
practices.
The sale of any Class A, Class B, Class C or Class D shares of a
Xxxxxxxx Mutual Fund will constitute Dealer/Bank's acceptance of and
agreement with the terms set forth herein.
x Xxxxxxxx Municipal Fund Series, Inc., Xxxxxxxx Municipal Series Trust,
Xxxxxxxx New Jersey Municipal Fund, Inc. and Xxxxxxxx Pennsylvania
Municipal Fund Series do not currently offer Class B shares.
POLICIES AND PROCEDURES
In connection with the offering by the Funds of four classes of
shares1, one subject to a front-end sales load and a service fee ("Class A
Shares"), one subject to a service fee, a distribution fee, no front-end sales
load and a contingent deferred sales load on redemptions within six years of
purchase ("Class B Shares"), one subject to service fee, a distribution fee, a
front-end sales load and a contingent deferred sales load on redemptions within
eighteen months of purchase ("Class C Shares") and one subject to a service fee,
a distribution fee, no front-end sales load and a contingent deferred sales load
on redemptions within one year of purchase ("Class D Shares")2, it is important
for an investor to choose the method of purchasing shares which best suits his
or her particular circumstances. To assist investors in these decisions, SAI has
instituted the following policies with respect to orders for Shares:
1. No purchase order may be placed for Class D shares unless the
investor meets one of the qualifications provided for in
Footnote 2 below. The Dealer/Bank is solely responsible for
complying with this restriction.
2. No purchase order may be placed for Class B Shares for amounts
of $250,000 or more, or for Class C Shares for amounts of
1,000,000 or more.
3. Any other purchase order may be for Class A, Class B, Class C,
or Class D shares in light of the relevant facts and
circumstances, including:
a. the specific purchase order dollar amount;
b. the length of time the investor expects to hold his
Shares; and
c. any other relevant circumstances such as the
availability of purchases under a Letter of Intent,
Volume Discount, or Right of Accumulation.
There are instances when one method of purchasing Shares may be more
appropriate than another. For example, an investor who would qualify for a
significant discount from the maximum sales load on Class A Shares may determine
that payment of such a reduced front-end sales load and service fee is
preferable to payment of a higher ongoing distribution fee. On the other hand,
an investor whose order would not qualify for such a discount may wish to have
all of his or her funds invested in Class B or Class C Shares. An investor who
expects to hold his or her shares for longer than eight years might prefer Class
B Shares over Class C Shares because of the conversion feature; once the Class B
Shares have converted to Class A Shares, the ongoing distribution fees will be
reduced. Class C Shares may remain a more attractive choice for shorter-term
investors (especially those who would qualify for a discount from the maximum
sales load) because the front-end sales load is lower than on Class A shares and
the contingent deferred sales load on such shares is only 1%, and it does not
apply if the investor owns his or her shares for at least eighteen months. If an
investor anticipates that he or she will redeem his or her Class B Shares while
still subject to a contingent deferred sales load, the investor may, depending
on the amount of the purchase, pay an amount greater than the sales load and
service fee attributable to Class A Shares.
Appropriate supervisory personnel within your organization must ensure
that all employees receiving investor inquiries about the purchase of Shares of
a Fund advise the investor of then available pricing structures offered by such
Fund, and the impact of choosing one method over another. In some instances it
may be appropriate for a supervisory person to discuss a purchase with the
investor.
Questions relating to this policy should be directed to Xxxxxxx X.
Xxxxxxx, President, Xxxxxxxx Advisors, Inc. at (000) 000-0000.
________________________
1 Xxxxxxxx Municipal Fund Series, Inc, Xxxxxxxx Municipal Series Trust,
Xxxxxxxx New Jersey Municipal Fund, Inc. and Xxxxxxxx Pennsylvania
Municipal Fund Series only offer three classes of shares; Class B shares
are not currently available from these Funds.
2 Class D shares are only available (1) to existing Class D shareholders, (2)
if the Dealer/Bank maintains an omnibus account at Xxxxxxxx Data Corp., or
(3) pursuant to a 401(k) or other retirement plan program for which ClassD
shares are already available or for which the sponsor requests Class D
shares because the sales charge structure of Class D shares is comparable
to the sales charge structure of the other funds offered under the program.
June 1, 1999
