XXXXX XXXXXX INC. EXHIBIT 6.2
MUTUAL FUND DEALER AGREEMENT
TO THE UNDERSIGNED DISTRIBUTOR
Ladies and Gentlemen:
We understand that you are principal distributor of shares of certain mutual
funds ("Funds") registered with the Securities and Exchange Commission under the
Investment Company Act of 1940 ("1940 Act"). You desire that Xxxxx Xxxxxx Inc.
("Xxxxx Xxxxxx") act as a dealer with respect to the sale of Shares to its
customers. In consideration of the mutual covenants stated below, you and Xxxxx
Xxxxxx agree as follows:
1. PURCHASE OF SHARES AT PUBLIC OFFERING PRICE. Xxxxx Xxxxxx will use such
efforts to sell Shares as it in its sole discretion determines, and will
not be required to sell any specified or minimum number of Shares of any
Fund. Sales of Shares through Xxxxx Xxxxxx will be at the public offering
price of such Shares (the net asset vale of the Shares plus any applicable
sales charge), as determined in accordance with the then effective
prospectus(es) and statement(s) of additional information used in
connection with the offer and sale of the Shares (collectively, the
"Prospectus"). The public offering price will reflect scheduled variations
in or the elimination of sales charges on sales of Shares either generally
to the public or in connection with special purchase plans, as described in
the Prospectus. Xxxxx Xxxxxx agrees to apply any scheduled variation in or
waivers of sales charges uniformly to all customers meeting the
qualifications therefor as specified in the Prospectus.
2. RIGHTS OF ACCUMULATION AND LETTERS OF INTENT. With respect to Funds sold
with an initial sales charge, Xxxxx Barney's Customers will be entitled to
reduced sales charges on purchases made under any letter of intent or right
of accumulation described in the Prospectus. In such case, the concession
from the public offering price retained by Xxxxx Xxxxxx will be based upon
such reduced sales charge; however, if a Xxxxx Xxxxxx Customer fails to
fulfill a letter of intent, thereafter you will pay Xxxxx Xxxxxx the amount
required to reflect the appropriate concession based on the actual
purchases made by the customer. When placing wire trades, Xxxxx Xxxxxx
agrees to advise you of any letter of intent executed by its customer or
any available right of accumulation.
3. EXCHANGES AND REDEMPTIONS. Exchanges of Shares between Funds and
redemptions of Shares by a Fund or repurchases of Shares by you will be
effected in the manner and upon the terms described in the Prospectus.
Exchanges will be subject to such restrictions and charges as are provided
for in the Prospectus. Redemptions and repurchases will be subject to any
applicable contingent deferred sales charges, redemption fees or other
charges as are provided for in the Prospectus. Any order placed by Xxxxx
Xxxxxx for the repurchase or redemption of Shares is subject to the timely
receipt by you or the pertinent Fund's transfer agent of all required
documents in good order.
4. HANDLING AND RECEIPT OF ORDERS. The handling and settlement of purchase,
exchange and redemption orders will be subject to the provisions of the
Prospectus and such further procedures you and Xxxxx Xxxxxx determine to be
appropriate from time-to-time, consistent with this Agreement. Orders
which Xxxxx Xxxxxx receives prior to the close of business as defined in
the Prospectus and placed with you within the time frame set forth in or
consistent with the Prospectus shall be executed at the public offering
price next computed after they are received by Xxxxx Xxxxxx. You will
provide such assistance to Xxxxx Xxxxxx in processing
orders as Xxxxx Xxxxxx reasonably requests. Xxxxx Xxxxxx will be
responsible for the accuracy, timeliness and completeness of purchase,
redemption or exchange orders it transmits to you by wire or telephone.
All orders shall be subject to your confirmation.
5. SHAREHOLDER SERVICING. If you and Xxxxx Xxxxxx agree, on an ongoing basis
Xxxxx Xxxxxx will provide shareholder servicing to its customers who
maintain investments in Shares. In so doing, Xxxxx Xxxxxx and its
employees and representatives may provide the following services, among
others: answer customer inquiries regarding the Funds and customer
investments therein; assist customers in changing dividend options; answer
questions about special investment and withdrawal plans, and assist
customers in enrolling such plans; distribute reports and materials
relating to the Funds to customers; assist in the establishment and
maintenance of accurate customer accounts and records, including assisting
in processing changes in addresses and other customer information; and
assist in processing purchase, exchange and redemption orders.
6. COMPENSATION AND EXPENSES
A. With respect to Shares which are sold with an initial sales charge,
Xxxxx Xxxxxx will retain such concessions from the public offering
price as are specified in the Prospectus. With respect to Shares
which are not sold with an initial sales charge, you will pay
commissions to Xxxxx Xxxxxx at such rates as you and Xxxxx Xxxxxx may
determine from time-to-time, consistent with this Agreement.
Consistent with the Prospectus and applicable law and regulation, from
time-to-time you and Xxxxx Xxxxxx may determine that Xxxxx Xxxxxx will
retain the full amount of initial sales charges and/or that you will
pay Xxxxx Xxxxxx additional compensation in connection with Xxxxx
Barney's sales of shares.
B. If Xxxxx Xxxxxx provides shareholder services pursuant to Paragraph 5
of this Agreement, you will pay Xxxxx Xxxxxx ongoing service fees at
such rates as you and Xxxxx Xxxxxx may determine from time-to-time.
Such payments shall be consistent with applicable law and regulation
and this Agreement. Your obligation to make payments to Xxxxx Xxxxxx
under this Subparagraph 6B shall survive any termination of this
Agreement, and shall continue so long as Xxxxx Xxxxxx provides
shareholder services described in Paragraph 5 of this Agreement to its
customers who hold Shares.
C. You will pay Xxxxx Xxxxxx ongoing trail commission compensation with
respect to holdings by Xxxxx Xxxxxx of Shares of Funds with respect to
which you pay such compensation generally to dealers, at such rates as
you and Xxxxx Xxxxxx may determine from time-to-time. Payments under
this Subparagraph 6C may be in addition to the payment of service fees
as described in Subparagraph 6B of this Agreement, and are subject to
applicable law and regulation and this Agreement. Your obligation to
make payments to Xxxxx Xxxxxx under this Subparagraph 6C shall survive
any termination of this Agreement, and shall continue so long as Xxxxx
Barney's customers maintain their investment in Shares.
D. With respect to expenses not specifically addressed elsewhere in this
Agreement, each party hereto will be responsible for the expenses it
incurs in acting hereunder. Consistent with the Prospectus and
applicable law and regulation, from time-to-time you and Xxxxx Xxxxxx
may determine that you will pay or reimburse Xxxxx Xxxxxx for expenses
it incurs in connection with selling Shares.
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7. STATE REGISTRATION OF FUND SHARES. You agree to advise Xxxxx Xxxxxx in
writing on a continuous and current basis of the identity of those states
and jurisdictions in which the Shares are registered or qualified for sale
to the public.
8. NASD REGULATION. Each party to this Agreement represents that it is a
member of the National Association of Securities Dealers, Inc. ("NASD") and
each party agrees to notify the other should it cease to be such a member.
With respect to the sale of Shares hereunder, you and Xxxxx Xxxxxx agree to
abide by the Conduct Rules of the NASD, including but not limited to the
following:
A. Xxxxx Xxxxxx shall not withhold placing customers orders for Shares so
as to profit itself as a result of such withholding. Xxxxx Xxxxxx
shall not purchase any shares from you other than for its own
investment or to cover purchase orders already received by it from its
customers.
B. If any Shares purchased by Xxxxx Xxxxxx are repurchased by the Fund
which issued such Shares or by you for the account of that Fund, or
are tendered for redemption, within seven (7) business days after
confirmation by you of the original purchase order for such Shares, no
compensation as set forth in Paragraph 6 above will be payable to
Xxxxx Xxxxxx with respect to such Shares, and Xxxxx Xxxxxx will refund
to you the full amount of any such compensation paid or allowed to it
on the original sale. You agree to notify Xxxxx Xxxxxx in writing of
any such repurchase or redemption within ten (10) business days of the
date on which the redemption is requested or Share certificates are
tendered to you, the pertinent Fund or its transfer agent.
Termination or cancellation of this Agreement will not relieve the
parties from the requirements of this subparagraph.
C. Neither party to this Agreement will, as principal, purchase any
Shares from a customer at a price lower than the net asset value next
determined by or for the Fund that issued such Shares. Nothing in
this subparagraph shall prevent Xxxxx Xxxxxx from selling Shares for a
customer to you or to the Fund which issued such Shares at the net
asset value then quoted by or for such Fund (less any applicable
contingent deferred sales charge or other charges) and charging a fair
commission or service fee for handling the transaction.
9. SUSPENSION OR WITHDRAWAL OF OFFERING. You reserve the right to suspend
sales of Shares of any Fund or withdraw any offering of Shares entirely.
10. PROVISION OF MATERIALS. At your expense, you will furnish to Xxxxx Xxxxxx
with current prospectuses and statements of additional information of the
Funds (including any supplements thereto), periodic reports to Fund
shareholders and marketing and other materials you have prepared relating
to the Funds in such quantities as Xxxxx Xxxxxx reasonably requests.
11. REPRESENTATIONS BY XXXXX XXXXXX CONCERNING THE FUNDS. Xxxxx Xxxxxx and its
agents and employees are not authorized to make any representations
concerning the Funds or their Shares except those contained in or
consistent with the Prospectus and such other written materials you provide
relating to the Funds.
12. PROSPECTUS DELIVERY. Xxxxx Xxxxxx will provide each of its customers
purchasing Shares with the pertinent prospectus(es) prior to or at the time
of purchase. Xxxxx Xxxxxx will provide any customer who so requests with
pertinent statement(s) of additional information.
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13. LIABILITY AND INDEMNIFICATION
A. You agree to be liable for, to hold Xxxxx Xxxxxx, its officers,
directors and employees harmless from and to indemnify each of them
for any losses and costs arising from: (i) any of your actions, and
the actions of your employees and affiliates, relating to the sale of
Fund shares, including but not limited to any statements or
representations contained in any sales or other material relating to
the Funds you or your affiliates provide to Xxxxx Xxxxxx or any other
written statements or representations, concerning the Funds that you,
your employees and your affiliates make to Xxxxx Xxxxxx; (ii) any
material misstatement in or omission of a material fact from a Fund's
current prospectus or statement of additional information; and (iii)
any failure of any Fund or its Shares to be properly registered and
available for sale under any applicable federal law and regulation or
the laws and regulations of any state, any U.S. territory or the
District of Columbia when you have represented to Xxxxx Xxxxxx that
the Fund and its Shares are so registered and qualified; and (iv) any
of your actions, or the actions of your affiliates, relating to the
processing of purchase, exchange and redemption orders and the
servicing of shareholder accounts. You shall not be liable for any
consequential damages.
B. Xxxxx Xxxxxx agrees to be liable for, to hold you, your officers,
directors and employees harmless from and to indemnify them from any
losses and costs arising from: (i) any statements or representations
that Xxxxx Xxxxxx or its employees make concerning the Funds that are
inconsistent with either the pertinent Funds' current prospectus and
statement of additional information or any other material you have
provided or any other written statements or representations, you have
made to Xxxxx Xxxxxx relating to the Funds; (ii) any sale of Shares of
a Fund where the Fund or its Shares were not properly registered or
qualified for sale in any state, any U.S. territory or the District of
Columbia, when you have indicated to Xxxxx Xxxxxx that the Fund and
its Shares were not properly registered and qualified; and (iii) any
of Xxxxx Barney's actions relating to the processing of purchase,
exchange and redemption orders and the servicing of shareholder
accounts. Xxxxx Xxxxxx shall not be liable for any consequential
damages.
C. The indemnification provided in paragraphs (a) and (b) of this section
shall not be valid if any such loss or cost is due to the negligence
or willful misconduct of the party to whom the indemnification would
otherwise be provided.
D. The provisions of this Paragraph 13 shall survive the termination of
this Agreement.
14. ARBITRATION. If a dispute arises between you and Xxxxx Xxxxxx with respect
to this Agreement which the parties are unable to resolve themselves, it
shall be settled by arbitration in accordance with the then-existing NASD
Code of Arbitration Procedure ("NASD Code"). The parties agree, that to
the extent permitted by the NASD Code, the arbitrator(s) shall be selected
from the securities industry.
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15. MISCELLANEOUS. This Agreement shall be governed by the laws of New York
State. This Agreement may be amended only upon the written agreement of
both parties hereto, and may be terminated by either party on ten days=
written notice to the other. If your payments to Xxxxx Xxxxxx under
Subparagraphs 6B and/or 6C hereunder in whole or in part are financed by a
Fund in accordance with a Fund's plan of distribution adopted pursuant to
rule 12b-1 under the 1940 Act, then in the event of the termination of such
rule 12b-1 plan of distribution by a Fund's board of directors or trustees
or shareholders, you and Xxxxx Xxxxxx agree to negotiate in good faith with
respect to whether and to what extent you will continue to make payments
from your own resources to Xxxxx Xxxxxx as required by Subparagraphs 6B and
6C hereunder. This Agreement constitutes the entire agreement between you
and Xxxxx Xxxxxx and supersedes all prior oral or written agreements
between you and Xxxxx Xxxxxx and its predecessors relating to the sale of
Shares.
Sincerely,
XXXXX XXXXXX INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Dated: March 17, 1997
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AGREED AND ACCEPTED:
Distributor Name: FPA Fund Distributors, Inc.
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Fund Complex: FPA Funds
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By: /s/ Xxxxx X. xx Xxxx, Xx., President
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Dated: February 26, 1997
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