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CLASS C SHARES
DISTRIBUTION AGREEMENT
AGREEMENT made as of the day of December 1999, between XXXXXXX XXXXX
FOCUS TWENTY FUND, INC., a Maryland corporation (the "Fund"), and PRINCETON
FUNDS DISTRIBUTOR, INC., a Delaware corporation (the "Distributor").
W I T N E S S E T H:
WHEREAS, the Fund is registered under the Investment Company Act of 1940,
as amended (the "Investment Company Act"), as an open-end investment company,
and it is affirmatively in the interest of the Fund to offer its shares for sale
continuously; and
WHEREAS, the Fund is a "feeder" fund that invests all of its assets in a
"master" portfolio, the Master Focus Twenty Trust, that has the same investment
objective and policies as the Fund; and
WHEREAS, the Distributor is a securities firm engaged in the business of
selling shares of investment companies either directly to purchasers or through
other securities dealers; and
WHEREAS, the Fund and the Distributor wish to enter into an agreement with
each other with respect to the continuous offering of the Class C shares of
common stock of the Fund.
NOW, THEREFORE, the parties agree as follows:
Section 1. Appointment of the Distributor. The Fund hereby appoints the
Distributor as the principal underwriter and distributor of the Fund to sell
Class C shares of common stock in
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the Fund (sometimes herein referred to as "Class C shares") to investors (as
defined below) and hereby agrees during the term of this Agreement to sell Class
C shares of the Fund to the Distributor upon the terms and conditions herein set
forth.
Section 2. Exclusive Nature of Duties. The Distributor shall be the
exclusive representative of the Fund to act as principal underwriter and
distributor, except that:
(a) The Fund may, upon written notice to the Distributor, from time to
time designate other principal underwriters and distributors of Class C shares
with respect to areas other than the United States as to which the Distributor
may have expressly waived in writing its right to act as such. If such
designation is deemed exclusive, the right of the Distributor under this
Agreement to sell Class C shares in the areas so designated shall terminate, but
this Agreement shall remain otherwise in full effect until terminated in
accordance with the other provisions hereof.
(b) The exclusive right granted to the Distributor to purchase Class C
shares from the Fund shall not apply to Class C shares issued in connection with
the merger or consolidation of any other investment company or personal holding
company with the Fund or the acquisition by purchase or otherwise of all (or
substantially all) the assets or the outstanding Class C shares of any such
company by the Fund.
(c) Such exclusive right also shall not apply to Class C shares issued by
the Fund pursuant to reinvestment of dividends or capital gains distributions.
(d) Such exclusive right also shall not apply to Class C shares issued by
the Fund pursuant to any conversion, exchange or reinstatement privilege
afforded redeeming
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shareholders or to any other Class C shares as shall be agreed between the Fund
and the Distributor from time to time.
Section 3. Purchase of Class C Shares from the Fund.
(a) Prior to the continuous offering of the Class C shares, commencing on
a date agreed upon by the Fund and the Distributor, it is contemplated that the
Distributor will solicit subscriptions for Class C shares during a subscription
period which shall last for such period as may be agreed upon by the parties
hereto. The subscriptions will be payable within three business days after the
termination of the subscription period, at which time the Fund will commence
operations.
(b) After the Fund commences operations, the Fund will commence an
offering of its Class C shares and thereafter the Distributor shall have the
right to buy from the Fund the Class C shares needed, but not more than the
Class C shares needed (except for clerical errors in transmission) to fill
unconditional orders for Class C shares of the Fund placed with the Distributor
by investors or securities dealers. Investors to purchase Class C shares shall
be those persons so identified in the currently effective prospectus and
statement of additional information of the Fund (the "prospectus" and "statement
of additional information," respectively) under the Securities Act of 1933, as
amended (the "Securities Act"), relating to such Class C shares. The price which
the Distributor shall pay for the Class C shares so purchased from the Fund
shall be the net asset value, determined as set forth in Section 3(d) hereof,
used in determining the public offering price on which such orders were based.
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(c) The Class C shares are to be resold by the Distributor to investors at
the public offering price, as set forth in Section 3(d) hereof, or to securities
dealers having agreements with the Distributor upon the terms and conditions set
forth in Section 7 hereof.
(d) The net asset value of Class C shares shall be determined by the Fund
or any agent of the Fund in accordance with the method set forth in the
prospectus and statement of additional information of the Fund and guidelines
established by the Directors.
(e) The Fund shall have the right to suspend the sale of its Class C
shares at times when redemption is suspended pursuant to the conditions set
forth in Section 4(b) hereof. The Fund shall also have the right to suspend the
sale of its Class C shares if trading on the New York Stock Exchange shall have
been suspended, if a banking moratorium shall have been declared by Federal or
New York authorities, or if there shall have been some other event, which, in
the judgment of the Fund, makes it impracticable or inadvisable to sell the
Class C shares.
(f) The Fund, or any agent of the Fund designated in writing by the Fund,
shall be promptly advised of all purchase orders for Class C shares received by
the Distributor. Any order may be rejected by the Fund; provided, however, that
the Fund will not arbitrarily or without reasonable cause refuse to accept or
confirm orders for the purchase of Class C shares from investors. The Fund (or
its agent) will confirm orders upon their receipt, will make appropriate book
entries and, upon receipt by the Fund (or its agent) of payment therefor, will
deliver deposit receipts or certificates for such Class C shares pursuant to the
instructions of the Distributor. Payment shall be made to the Fund in New York
Clearing House funds. The
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Distributor agrees to cause such payment and such instructions to be delivered
promptly to the Fund (or its agent).
Section 4. Repurchase or Redemption of Class C shares by the Fund.
(a) Any of the outstanding Class C shares may be tendered for redemption
at any time, and the Fund agrees to repurchase or redeem the Class C shares so
tendered in accordance with its obligations as set forth in Article VI of its
Articles of Incorporation, as amended from time to time, and in accordance with
the applicable provisions set forth in the prospectus and statement of
additional information. The price to be paid to redeem or repurchase the Class C
shares shall be equal to the net asset value calculated in accordance with the
provisions of Section 3(d) hereof, less any contingent deferred sales charge
("CDSC"), redemption fee or other charge(s), if any, set forth in the prospectus
and statement of additional information of the Fund. All payments by the Fund
hereunder shall be made in the manner set forth below.
The Fund shall pay the total amount of the redemption price as defined in
the above paragraph pursuant to the instructions of the Distributor on or before
the seventh business day subsequent to its having received the notice of
redemption in proper form. The proceeds of any redemption of shares shall be
paid by the Fund as follows: (i) any applicable CDSC shall be paid to the
Distributor, and (ii) the balance shall be paid to or for the account of the
shareholder, in each case in accordance with the applicable provisions of the
prospectus and statement of additional information.
(b) Redemption of Class C shares or payment may be suspended at times when
the New York Stock Exchange is closed, when trading on said Exchange is
suspended, when trading on said Exchange is restricted, when an emergency exists
as a result of which disposal by the
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Fund of securities owned by it is not reasonably practicable or it is not
reasonably practicable for the Fund fairly to determine the value of its net
assets, or during any other period when the Securities and Exchange Commission,
by order, so permits.
Section 5. Duties of the Fund.
(a) The Fund shall furnish to the Distributor copies of all information,
financial statements and other papers which the Distributor may reasonably
request for use in connection with the distribution of Class C shares of the
Fund, and this shall include, upon request by the Distributor, one certified
copy of all financial statements prepared for the Fund by independent public
accountants. The Fund shall make available to the Distributor such number of
copies of the prospectus and statement of additional information as the
Distributor shall reasonably request.
(b) The Fund shall take, from time to time, but subject to any necessary
approval of the Class C shareholders, all necessary action to fix the number of
authorized Class C shares and such steps as may be necessary to register the
same under the Securities Act, to the end that there will be available for sale
such number of Class C shares as the Distributor may reasonably be expected to
sell.
(c) The Fund shall use its best efforts to qualify and maintain the
qualification of an appropriate number of its Class C shares for sale under the
securities laws of such states as the Distributor and the Fund may approve. Any
such qualification may be withheld, terminated or withdrawn by the Fund at any
time in its discretion. As provided in Section 8(c) hereof, the expense of
qualification and maintenance of qualification shall be borne by the Fund. The
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Distributor shall furnish such information and other material relating to its
affairs and activities as may be required by the Fund in connection with such
qualification.
(d) The Fund will furnish, in reasonable quantities upon request by the
Distributor, copies of annual and interim reports of the Fund.
Section 6. Duties of the Distributor.
(a) The Distributor shall devote reasonable time and effort to effect
sales of Class C shares of the Fund but shall not be obligated to sell any
specific number of Class C shares. The services of the Distributor to the Fund
hereunder are not to be deemed exclusive and nothing herein contained shall
prevent the Distributor from entering into like arrangements with other
investment companies so long as the performance of its obligations hereunder is
not impaired thereby.
(b) In selling the Class C shares of the Fund, the Distributor shall use
its best efforts in all respects duly to conform with the requirements of all
Federal and state laws relating to the sale of such securities. Neither the
Distributor nor any selected dealer, as defined in Section 7 hereof, nor any
other person is authorized by the Fund to give any information or to make any
representations, other than those contained in the registration statement or
related prospectus and statement of additional information and any sales
literature specifically approved by the Fund.
(c) The Distributor shall adopt and follow procedures, as approved by the
officers of the Fund, for the confirmation of sales to investors and selected
dealers, the collection of amounts payable by investors and selected dealers on
such sales, and the cancellation of unsettled transactions, as may be necessary
to comply with the requirements of the National
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Association of Securities Dealers, Inc. (the "NASD"), as such requirements may
from time to time exist.
Section 7. Selected Dealers Agreements.
(a) The Distributor shall have the right to enter into selected dealers
agreements with securities dealers of its choice ("selected dealers") for the
sale of Class C shares and fix therein the portion of the sales charge which may
be allocated to the selected dealers; provided that the Fund shall approve the
forms of agreements with dealers and the dealer compensation set forth therein.
Class C shares sold to selected dealers shall be for resale by such dealers only
at the public offering price(s) set forth in the prospectus and statement of
additional information. The form of agreement with selected dealers to be used
during the subscription period described in Section 3(a) is attached hereto as
Exhibit A and the initial form of agreement with selected dealers to be used in
the continuous offering of the Class C shares is attached hereto as Exhibit B.
(b) Within the United States, the Distributor shall offer and sell Class C
shares only to such selected dealers as are members in good standing of the
NASD.
Section 8. Payment of Expenses.
(a) The Fund shall bear all costs and expenses of the Fund, including fees
and disbursements of its counsel and auditors, in connection with the
preparation and filing of any required registration statements and/or
prospectuses and statements of additional information under the Investment
Company Act, the Securities Act, and all amendments and supplements thereto, and
preparing and mailing annual and interim reports and proxy materials to Class C
shareholders (including but not limited to the expense of setting in type any
such registration
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statements, prospectuses, statements of additional information, annual or
interim reports or proxy materials).
(b) The Distributor shall be responsible for any payments made to selected
dealers as reimbursement for their expenses associated with payments of sales
commissions to financial consultants. In addition, after the prospectuses,
statements of additional information and annual and interim reports have been
prepared and set in type, the Distributor shall bear the costs and expenses of
printing and distributing any copies thereof which are to be used in connection
with the offering of Class C shares to selected dealers or investors pursuant to
this Agreement. The Distributor shall bear the costs and expenses of preparing,
printing and distributing any other literature used by the Distributor or
furnished by it for use by selected dealers in connection with the offering of
the Class C shares for sale to eligible investors and any expenses of
advertising incurred by the Distributor in connection with such offering. It is
understood and agreed that, so long as the Fund's Class C Shares Distribution
Plan pursuant to Rule 12b-1 under the Investment Company Act remains in effect,
any expenses incurred by the Distributor hereunder may be paid from amounts
recovered by it from the Fund under such Plan.
(c) The Fund shall bear the cost and expenses of qualification of the
Class C shares for sale pursuant to this Agreement and, if necessary or
advisable in connection therewith, of qualifying the Fund as a broker or dealer
in such states of the United States or other jurisdictions as shall be selected
by the Fund and the Distributor pursuant to Section 5(c) hereof and the cost and
expenses payable to each such state for continuing qualification therein until
the Fund decides to discontinue such qualification pursuant to Section 5(c)
hereof.
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Section 9. Indemnification.
(a) The Fund shall indemnify and hold harmless the Distributor and each
person, if any, who controls the Distributor against any loss, liability, claim,
damage or expense (including the reasonable cost of investigating or defending
any alleged loss, liability, claim, damage or expense and reasonable counsel
fees incurred in connection therewith), as incurred, arising by reason of any
person acquiring any Class C shares, which may be based upon the Securities Act,
or on any other statute or at common law, on the ground that the registration
statement or related prospectus and statement of additional information, as from
time to time amended and supplemented, or an annual or interim report to
shareholders of the Fund, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading, unless such statement or
omission was made in reliance upon, and in conformity with, information
furnished to the Fund in connection therewith by or on behalf of the
Distributor; provided, however, that in no case (i) is the indemnity of the Fund
in favor of the Distributor and any such controlling persons to be deemed to
protect such Distributor or any such controlling persons thereof against any
liability to the Fund or its security holders to which the Distributor or any
such controlling persons would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of their duties or
by reason of the reckless disregard of their obligations and duties under this
Agreement; or (ii) is the Fund to be liable under its indemnity agreement
contained in this paragraph with respect to any claim made against the
Distributor or any such controlling persons, unless the Distributor or such
controlling persons, as the case may be, shall have notified the Fund in writing
within a reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the
Distributor
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or such controlling persons (or after the Distributor or such controlling
persons shall have received notice of such service on any designated agent), but
failure to notify the Fund of any such claim shall not relieve it from any
liability which it may have to the person against whom such action is brought
otherwise than on account of its indemnity agreement contained in this
paragraph. The Fund will be entitled to participate at its own expense in the
defense or, if it so elects, to assume the defense of any suit brought to
enforce any such liability, but if the Fund elects to assume the defense, such
defense shall be conducted by counsel chosen by it and satisfactory to the
Distributor or such controlling person or persons, defendant or defendants in
the suit. In the event the Fund elects to assume the defense of any such suit
and retain such counsel, the Distributor or such controlling person or persons,
defendant or defendants in the suit shall bear the fees and expenses of any
additional counsel retained by them, but in case the Fund does not elect to
assume the defense of any such suit, it will reimburse the Distributor or such
controlling person or persons, defendant or defendants in the suit, for the
reasonable fees and expenses of any counsel retained by them. The Fund shall
promptly notify the Distributor of the commencement of any litigation or
proceedings against it or any of its officers or Directors in connection with
the issuance or sale of any of the Class C shares.
(b) The Distributor shall indemnify and hold harmless the Fund and each of its
Directors and officers and each person, if any, who controls the Fund against
any loss, liability, claim, damage or expense described in the foregoing
indemnity contained in subsection (a) of this Section, but only with respect to
statements or omissions made in reliance upon, and in conformity with,
information furnished to the Fund in writing by or on behalf of the Distributor
for use in connection with the registration statement or related prospectus and
statement of additional information, as from time to time amended, or the annual
or interim reports to Class C
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shareholders. In case any action shall be brought against the Fund or any person
so indemnified, in respect of which indemnity may be sought against the
Distributor, the Distributor shall have the rights and duties given to the Fund,
and the Fund and each person so indemnified shall have the rights and duties
given to the Distributor by the provisions of subsection (a) of this Section 9.
Section 10. Duration and Termination of this Agreement. This Agreement
shall become effective as of the date first above written and shall remain in
force until two years after the date first above written, and thereafter, but
only for so long as such continuance is specifically approved at least annually
by (i) the Directors or by the vote of a majority of the outstanding voting
securities of the Fund and (ii) by the vote of a majority of those Directors who
are not parties to this Agreement or interested persons of any such party cast
in person at a meeting called for the purpose of voting on such approval.
This Agreement may be terminated at any time, without the payment of any
penalty, by the Directors or by vote of a majority of the outstanding voting
securities of the Fund, or by the Distributor, on sixty days' written notice to
the other party. This Agreement shall automatically terminate in the event of
its assignment.
The terms "vote of a majority of the outstanding voting securities",
"assignment", "affiliated person" and "interested person", when used in this
Agreement, shall have the respective meanings specified in the Investment
Company Act.
Section 11. Amendments of this Agreement. This Agreement may be amended by
the parties only if such amendment is specifically approved by (i) the Directors
or by the vote of a majority of outstanding voting securities of the Fund and
(ii) by the vote of a majority of those
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Directors of the Fund who are not parties to this Agreement or interested
persons of any such party cast in person at a meeting called for the purpose of
voting on such approval.
Governing Law. The provisions of this Agreement shall be construed and
interpreted in accordance with the laws of the State of New York as at the time
in effect and the applicable provisions of the Investment Company Act. To the
extent that the applicable law of the State of New York, or any of the
provisions herein, conflict with the applicable provisions of the Investment
Company Act, the latter shall control.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
XXXXXXX XXXXX FOCUS TWENTY FUND, INC.
By
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Name:
Title:
PRINCETON FUNDS DISTRIBUTOR, INC.
By
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Name:
Title:
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EXHIBIT A
XXXXXXX XXXXX FOCUS TWENTY FUND, INC.
CLASS C SHARES OF COMMON STOCK
SELECTED DEALER AGREEMENT
FOR SUBSCRIPTION PERIOD
Ladies and Gentlemen:
Princeton Funds Distributor, Inc. (the "Distributor"), has an agreement
with Xxxxxxx Xxxxx Focus Twenty Fund, Inc., a Maryland corporation (the "Fund")
pursuant to which it acts as the distributor for the sale of Class C shares of
common stock, par value $0.10 per share (herein referred to as "Class C
shares"), of the Fund, and as such has the right to distribute Class C shares of
the Fund for resale. The Fund is an open-end investment company registered under
the Investment Company Act of 1940, as amended (the "Investment Company Act"),
and its Class C shares being offered to the public are registered under the
Securities Act of 1933, as amended (the "Securities Act"). Such Class C shares
and certain of the terms on which they are being offered are more fully
described in the enclosed prospectus and statement of additional information.
You have received a copy of the Class C shares Distribution Agreement (the
"Distribution Agreement") between ourself and the Fund and reference is made
herein to certain provisions of such Distribution Agreement. This Agreement
relates solely to the subscription period described in Section 3(a) of such
Distribution Agreement. Subject to the foregoing, as principal, we offer to sell
to you, as a member of the Selected Dealers Group, Class C shares of the Fund
for resale to investors identified in the prospectus and statement of additional
information upon the following terms and conditions:
1. The subscription period referred to in Section 3(a) of the Distribution
Agreement will continue through February , 2000. The subscription period may be
extended upon agreement between the Fund and the Distributor. Subject to the
provisions of such Section and the conditions contained herein, we will sell to
you on the third business day following the termination of the subscription
period, or such other date as we may advise (the "Closing Date"), such number of
Class C shares as to which you have placed orders with us not later than 5:00
P.M. on the second full business day preceding the Closing Date.
2. In all sales of these Class C shares to the public, you shall act as
dealer for your own account, and in no transaction shall you have any authority
to act as agent for the Fund, for us or for any other member of the Selected
Dealers Group, except in connection with such special programs as we from time
to time agree, in which case you shall have authority to offer and sell shares,
as agent for the Fund, to participants in such program.
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3. As an authorized agent to sell shares of the Fund, you agree to
purchase shares of the Fund only through us or from your customers. You shall
not place orders for any of the Class C shares except for your own investment
purposes or unless you have already received purchase orders for such Class C
shares at the applicable public offering prices and subject to the terms hereof
and of the Distribution Agreement. All orders are subject to acceptance by the
Distributor or the Fund in the sole discretion of either. The minimum initial
and subsequent purchase requirements are as set forth in the prospectus, as
amended from time to time. You agree that you will not offer or sell any of the
Class C shares except under circumstances that will result in compliance with
the applicable Federal and state securities laws and that in connection with
sales and offers to sell Class C shares you will furnish to each person to whom
any such sale or offer is made a copy of the prospectus and, if requested, the
statement of additional information (as then amended or supplemented) and will
not furnish to any person any information relating to the Class C shares of the
Fund which is inconsistent in any respect with the information contained in the
prospectus and statement of additional information (as then amended or
supplemented) or cause any advertisement to be published in any newspaper or
posted in any public place without our consent and the consent of the Fund.
4. Payment for Class C shares purchased by you is to be made on such date
as we may advise by wire transfer of immediately available funds to a bank
account designated by us against delivery by us of non-negotiable share deposit
receipts ("Receipts") issued by Financial Data Services, Inc., as shareholder
servicing agent, acknowledging the deposit with it of the Class C shares so
purchased by you. You agree that as promptly as practicable after the delivery
of such Class C shares you will issue appropriate written transfer instructions
to the Fund or to the shareholder servicing agent as to the purchasers to whom
you sold the Class C shares.
5. No person is authorized to make any representations concerning Class C
shares of the Fund except those contained in the current prospectus and
statement of additional information of the Fund and in such printed information
subsequently issued by us or the Fund as information supplemental to such
prospectus and statement of additional information. In purchasing Class C shares
through us you shall rely solely on the representations contained in the
prospectus and statement of additional information and supplemental information
above mentioned. Any printed information which we furnish you other than the
Fund's prospectus and statement of additional information, periodic reports and
proxy solicitation material are our sole responsibility and not the
responsibility of the Fund, and you agree that the Fund shall have no liability
or responsibility to you in these respects unless expressly assumed in
connection therewith.
6. You agree to deliver to each of the purchasers making purchases from
you a copy of the then current prospectus and, if requested, the statement of
additional information at or prior to the time of offering or sale and you agree
thereafter to deliver to such purchasers copies of the annual and interim
reports and proxy solicitation materials of the Fund. You further agree to
endeavor to obtain proxies from such purchasers. Additional copies of the
prospectus and statement of additional information, annual or interim reports
and proxy solicitation materials of the Fund will be supplied to you in
reasonable quantities upon request.
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7. All sales will be subject to receipt of shares by us from the Fund. We
reserve the right in our discretion, without notice, to suspend sales or
withdraw the offering of Class C shares entirely or to certain persons or
entities in a class or classes specified by us or to modify or cancel this
Agreement. Each party hereto has the right to cancel this Agreement upon notice
to the other party.
8. We shall have full authority to take such action as we may deem
advisable in respect of all matters pertaining to the subscription offering. We
shall be under no liability to you except for lack of good faith and for
obligations expressly assumed by us herein. Nothing contained in this paragraph
is intended to operate as, and the provisions of this paragraph shall not in any
way whatsoever constitute, a waiver by you of compliance with any provision of
the Securities Act, or of the rules and regulations of the Securities and
Exchange Commission issued thereunder.
9. By accepting this Agreement, you represent that you are registered as a
broker-dealer under the Securities Exchange Act of 1934, are qualified to act as
a broker or dealer in the states or other jurisdictions where you transact
business, and are a member in good standing of the National Association of
Securities Dealers, Inc., and you agree that you will maintain such
registrations, qualifications, and membership in good standing and in full force
and effect throughout the term of this Agreement. You further agree to comply
with all applicable Federal laws, the laws of the states or other jurisdictions
concerned, and the rules and regulations promulgated thereunder and with the
Constitution, By-Laws and Conduct Rules of the National Association of
Securities Dealers, Inc., and that you will not offer or sell shares of the
Funds in any state or jurisdiction where they may not lawfully be offered and/or
sold.
If you are offering and selling shares of the Fund in jurisdictions
outside the several states, territories, and possessions of the United States
and are not otherwise required to be registered, qualified, or a member of the
National Association of Securities Dealers, Inc., as set forth above you, you
nevertheless agree to observe the applicable laws of the jurisdiction in which
such offer and/or sale is made, to comply with the full disclosure requirements
of the Securities Act and the regulations promulgated thereunder, to conduct
your business in accordance with the spirit of the Conduct Rules of the National
Association of Securities Dealers, Inc. You agree to indemnify and hold the
Fund, its investment adviser, and us harmless from loss or damage resulting from
any failure on your part to comply with applicable laws.
10. Upon application to us, we will inform you as to the states in which
we believe the Class C shares have been qualified for sale under, or are exempt
from the requirements of, the respective securities laws of such states, but we
assume no responsibility or obligation as to your right to sell shares in any
jurisdiction. We will file with the Department of State in New York a Further
State Notice with respect to the Class C shares, if necessary.
11. All communications to us should be sent to the address below. Any
notice to you shall be duly given if mailed or telegraphed to you at the address
specified by you below.
12. You agree that you will not sell any Class C shares of the Fund to any
account over which you exercise discretionary authority.
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00. This Agreement shall terminate at the close of business on the Closing
Date, unless earlier terminated, provided, however, this Agreement shall
continue after termination for the purpose of Section 7 hereof and for the
purpose of settlement of accounts hereunder.
PRINCETON FUNDS DISTRIBUTOR, INC.
By
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(Authorized Signature)
Please return one signed copy
of this Agreement to:
XXXXXXX XXXXX FUNDS DISTRIBUTOR
a division of PRINCETON FUNDS DISTRIBUTOR, INC.
X.X. Xxx 0000
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
Accepted:
Firm Name:______________________________________
By:_____________________________________________
Address:________________________________________
________________________________________________
Date:___________________________________________
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EXHIBIT B
XXXXXXX XXXXX FOCUS TWENTY FUND, INC.
CLASS C SHARES OF COMMON STOCK
SELECTED DEALERS AGREEMENT
Ladies and Gentlemen:
Princeton Funds Distributor (the "Distributor"), has an agreement with
Xxxxxxx Xxxxx Focus Twenty Fund, Inc., a Maryland Corporation (the "Fund"),
pursuant to which it acts as the distributor for the sale of Class C shares of
common stock, par value $0.10 per share (herein referred to as "Class C
shares"), of the Fund and as such has the right to distribute Class C shares of
the Fund for resale. The Fund is an open-end investment company registered under
the Investment Company Act of 1940, as amended (the "Investment Company Act"),
and its Class C shares being offered to the public are registered under the
Securities Act of 1933, as amended (the "Securities Act"). You have received a
copy of the Class C Shares Distribution Agreement (the "Distribution Agreement")
between ourself and the Fund and reference is made herein to certain provisions
of such Distribution Agreement. The terms "prospectus" and "statement of
additional information" used herein refer to the prospectus and statement of
additional information, respectively, on file with the Securities and Exchange
Commission which is part of the most recent effective registration statement
pursuant to the Securities Act. We offer to sell to you, as a member of the
Selected Dealers Group, Class C shares of the Fund upon the following terms and
conditions:
1. In all sales of these Class C shares to the public, you shall act as
dealer for your own account and in no transaction shall you have any authority
to act as agent for the Fund, for us or for any other member of the Selected
Dealers Group, except in connection with such special programs as we from time
to time agree, in which case you shall have authority to offer and sell shares,
as agent for the Fund, to participants in such program.
2. Orders received from you will be accepted through us only at the public
offering price applicable to each order, as set forth in the current prospectus
and statement of additional information of the Fund, subject in each case to the
delivery prior to or at the time of such sales to the then current prospectus.
The procedure relating to the handling of orders shall be subject to Section 4
hereof and instructions which we or the Fund shall forward from time to time to
you. All orders are subject to acceptance or rejection by the Distributor or the
Fund in the sole discretion of either. The minimum initial and subsequent
purchase requirements are as set forth in the current prospectus and statement
of additional information of the Fund and no order for less than such amounts
will be accepted unless such purchase shall be expressly approved by the Fund
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19
in accordance with the then current prospectus. No conditional order will be
accepted on any basis other than a definite price.
3. As an authorized agent to sell shares of the Fund, you agree to
purchase shares of the Fund only through us or from your customers. You shall
not place orders for any of the Class C shares except for your own investment
purposes or unless you have already received purchase orders for such Class C
shares at the applicable public offering prices and subject to the terms hereof
and of the Distribution Agreement. You agree that you will not offer or sell any
of the Class C shares except under circumstances that will result in compliance
with the applicable Federal and state securities laws and that in connection
with sales and offers to sell Class C shares you will furnish to each person to
whom any such sale or offer is made a copy of the prospectus and, if requested,
the statement of additional information (as then amended or supplemented) and
will not furnish to any person any information relating to the Class C shares of
the Fund, which is inconsistent in any respect with the information contained in
the prospectus and statement of additional information (as then amended or
supplemented) or cause any advertisement to be published in any newspaper or
posted in any public place without our consent and the consent of the Fund.
4. As a selected dealer, you are hereby authorized (i) to place orders
directly with the Fund for Class C shares of the Fund to be resold by us to you
subject to the applicable terms and conditions governing the placement of orders
by us set forth in Section 3 of the Distribution Agreement and (ii) to tender
Class C shares directly to the Fund or its agent for redemption subject to the
applicable terms and conditions set forth in Section 4 of the Distribution
Agreement.
5. You agree to place orders received from your customers as soon as
practicable after your receipt of such orders. You further agree that you shall
not withhold placing orders received from your customers so as to profit
yourself as a result of such withholding, e.g., by a change in the "net asset
value" from that used in determining the offering price to your customers.
6. Settlement shall be made promptly, but in no case later than the time
customary for such payments after our acceptance of the order or, if so
specified by you, we will make delivery by draft on you, the amount of which
draft you agree to pay on presentation to you. If payment is not so received or
made, the right is reserved forthwith to cancel the sale or at our option to
resell the shares to the Fund at the then prevailing net asset value in which
latter case you agree to be responsible for any loss resulting to the Fund or to
us from your failure to make payment as aforesaid.
7. No person is authorized to make any representations concerning Class C
shares of the Fund except those contained in the current prospectus and
statement of additional information of the Fund and in such printed information
subsequently issued by us or the Fund as information supplemental to such
prospectus and statement of additional information. In purchasing Class C shares
through us you shall rely solely on the representations contained in the
prospectus and statement of additional information and supplemental information
above mentioned. Any printed
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20
information which we furnish you other than the Fund's prospectus, statement of
additional information, periodic reports and proxy solicitation material are our
sole responsibility and not the responsibility of the Fund, and you agree that
the Fund shall have no liability or responsibility to you in these respects
unless expressly assumed in connection therewith.
8. You agree to deliver to each of the purchasers making purchases from
you a copy of the then current prospectus and, if requested, the statement of
additional information at or prior to the time of offering or sale and you agree
thereafter to deliver to such purchasers copies of the annual and interim
reports and proxy solicitation materials of the Fund. You further agree to
endeavor to obtain proxies from such purchasers. Additional copies of the
prospectus and statement of additional information, annual or interim reports
and proxy solicitation materials of the Fund will be supplied to you in
reasonable quantities upon request.
9. All sales will be subject to receipt of shares by us from the Fund. We
reserve the right in our discretion, without notice, to suspend sales or
withdraw the offering of Class C shares entirely or to certain persons or
entities in a class or classes specified by us. Each party hereto has the right
to cancel this Agreement upon notice to the other party.
10. We, our affiliates, the Fund (and its officers and directors), and the
Trust (and its officers and trustees) shall not be liable for any loss,
expenses, damages, costs or other claims arising out of any redemption or
exchange pursuant to telephone instructions from any person, or our refusal to
execute such instructions for any reason.
11. You and we understand and agree that you are solely responsible for
the recommendation by your sales personnel to you customers of the purchase or
sale of Class C Shares of the Fund and the suitability of such purchase or sale
for the customer involved.
12. We shall have full authority to take such action as we may deem
advisable in respect of all matters pertaining to the continuous offering. We
shall be under no liability to you except for lack of good faith and for
obligations expressly assumed by us herein. Nothing contained in this paragraph
is intended to operate as, and the provisions of this paragraph shall not in any
way whatsoever constitute, a waiver by you of compliance with any provision of
the Securities Act, or of the rules and regulations of the Securities and
Exchange Commission issued thereunder.
13. By accepting this Agreement, you represent that you are registered as
a broker-dealer under the Securities Exchange Act of 1934, are qualified to act
as a broker or dealer in the states or other jurisdictions where you transact
business, and are a member in good standing of the National Association of
Securities Dealers, Inc., and you agree that you will maintain such
registrations, qualifications, and membership in good standing and in full force
and effect throughout the term of this Agreement. You further agree to comply
with all applicable Federal laws, the laws of the states or other jurisdictions
concerned, and the rules and regulations promulgated thereunder and with the
Constitution, By-Laws and Conduct Rules of the National
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21
Association of Securities Dealers, Inc., and that you will not offer or sell
shares of the Funds in any state or jurisdiction where they may not lawfully be
offered and/or sold.
If you are offering and selling shares of the Fund in jurisdictions
outside the several states, territories, and possessions of the United States
and are not otherwise required to be registered, qualified, or a member of the
National Association of Securities Dealers, Inc., as set forth above you, you
nevertheless agree to observe the applicable laws of the jurisdiction in which
such offer and/or sale is made, to comply with the full disclosure requirements
of the Securities Act and the regulations promulgated thereunder, to conduct
your business in accordance with the spirit of the Conduct Rules of the National
Association of Securities Dealers, Inc. You agree to indemnify and hold the
Fund, its investment adviser, and us harmless from loss or damage resulting from
any failure on your part to comply with applicable laws.
14. Upon application to us, we will inform you as to the states in which
we believe the Class C shares have been qualified for sale under, or are exempt
from the requirements of, the respective securities laws of such states, but we
assume no responsibility or obligation as to your right to sell Class C shares
in any jurisdiction. We will file with the Department of State in New York a
Further State Notice with respect to the Class C shares, if necessary.
15. All communications to us should be sent to the address below. Any
notice to you shall be duly given if mailed or telegraphed to you at the address
specified by you below.
16. You agree to maintain records of all sales of shares made through you
and to furnish us with copies of each record on request.
17. You and we understand that, except as expressly provided in this
Agreement, in no transaction will you have any authority to take any action or
make any representation binding upon the Fund, us or any other member of the
Selected Dealers Group.
18. This Agreement may be amended by us from time to time by the following
procedure. We will mail a copy of the amendment to you at your address as
specified below. If you do not object to the amendment within fifteen (15) days
after its receipt, the amendment will become a part of the Agreement. Your
objection must be in writing and be received by us within such fifteen days.
19. This Agreement may be terminated upon written notice by either party
at any time, and shall automatically terminate upon its attempted assignment by
you, whether by operation of law or otherwise, or by us otherwise than by
operation of law.
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22
20. Your first order placed pursuant to this Agreement for the purchase of
Class C shares of the Fund will represent your acceptance of this Agreement.
PRINCETON FUNDS DISTRIBUTOR, INC.
By
---------------------------------------
(Authorized Signature)
Please return one signed copy
of this agreement to:
XXXXXXX XXXXX FUNDS DISTRIBUTOR,
a division of PRINCETON FUNDS DISTRIBUTOR, INC.
X.X. Xxx 0000
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
Accepted:
Firm Name:______________________________________
By:_____________________________________________
Address:________________________________________
________________________________________________
Date:___________________________________________
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