PRINCOR FINANCIAL SERVICES CORPORATION
The Principal Financial Group
000 0xx Xxxxxx
Xxx Xxxxxx, Xxxx 00000-0000
PRINCIPAL INVESTORS FUND
SELLING GROUP AGREEMENT
Princor Financial Services Corporation ("Princor", "We" or "Us") is the
principal underwriter, as defined in the Investment Company Act of 1940, of the
shares ("Shares") of the Principal Investors Fund, Inc. (the "Fund"), an
open-end investment company incorporated in the state of Maryland. We understand
that ("You") are a member of the National Association of Securities Dealers,
Inc. ("NASD") and, on the basis of this understanding, invite you to become a
member of the Selling Group to distribute Shares of the Fund according to the
following terms and conditions:
1. Each party to this Agreement represents that it currently is and, while
this Agreement is in effect, will continue to be a member in good standing
of the NASD and agrees to abide by all Rules and Regulations of that
Association, including the NASD Rules of Fair Practice. If you are a
foreign dealer, not eligible for membership in the NASD, you still agree to
abide by the Rules and Regulations of the NASD. Both parties agree to
comply with all applicable state and federal laws, rules and regulations of
the Securities and Exchange Commission ("SEC") and other authorized United
States or foreign regulatory agencies. You further agree that you will not
sell, offer for sale, or solicit Shares in any state where they have not
been qualified for sale. You will solicit applications and sell Shares only
in accordance with the terms and on the basis of the representations
contained in the then current Prospectus, Statement of Additional
Information and any supplemental information furnished by us.
2. You must represent that you are currently a member of the Securities
Investors Protection Corporation ("SIPC") and, while this Agreement is in
effect, will continue to be a member of SIPC. You agree to notify us
immediately if your SIPC membership status changes.
3. Orders for Shares received from you and accepted by us will be at the
current public offering price applicable to each order as established by
the then current Fund Prospectus. The procedure relating to the handling
of orders shall be subject to instructions that we shall forward to all
Selling Group members. The Fund reserves the right to withdraw Shares
from sale temporarily or permanently. All orders are subject to
acceptance by us and the Fund and each reserve the right in our sole
discretion to reject any order in whole or in part.
4. As a member of the Selling Group, you agree to purchase Shares only
through us. Purchases through us shall be made only for the purpose of
covering purchase orders already received from your customers, and we
agree that we will not place orders for the purchase of Shares from the
Fund except to cover purchase orders already received by us.
5. The Fund has adopted Distribution Plan(s) (the "Plan") pursuant to Rule
12b-1 under the Investment Company Act of 1940 (the "1940 Act") for
certain Classes of the Fund. Each Agreement defines services to be
provided by Selling Group members for which they will be compensated
pursuant to the Plan.
(a) As a Selling Group member, you agree to provide distribution
assistance and administrative support services in connection with the
distribution of Shares to customers who may from time to time directly
or beneficially own Shares, including but not limited to distributing
sales literature, answering routine customer inquiries regarding the
Fund, assisting in the establishment and maintenance of accounts in
the Fund and in the processing of the purchase and redemption of
Shares, making the Fund's investment plans and dividend options
available, and providing such other information and services in
connection with the distribution of the Fund Shares as may be
reasonably requested from time to time.
(b) For such services, you will be compensated in accordance with attached
Schedule A.
(c) The Plan may be terminated at any time without payment of any penalty
by the Fund in accordance with the rules governing such plans
promulgated by the SEC.
(d) The provisions of the Plan are incorporated herein and made a part
hereof by reference, and will continue in full force and effect so
long as its continuance is approved at least annually pursuant to Rule
12b-1.
6. You agree that you will not withhold placing customers' orders so as to
profit yourself as a result of such withholding.
7. You agree to sell Shares only to (a) your customers at the public offering
price then in effect; or (b) us as agent for the Fund or to the Fund itself
at the redemption price, as described in the Fund's then current Prospectus
or Statement of Additional Information.
8. Settlement shall be made promptly, but in no case later than three (3)
business days 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 offering price 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 stated.
9. If any Shares sold to you under the terms of this agreement are repurchased
by the Fund or by us as agent, or are tendered to the Fund for redemption
within seven (7) business days after the date of our confirmation to you of
the original purchase order therefor, you agree to pay forthwith to us the
full amount of the commission allowed to you on the original sale. We shall
notify you of such repurchase within ten (10) days of the effective date of
such repurchase.
10. All sales will be subject to receipt of Shares by us from the Fund. We
reserve the right in our discretion, without notice to you, to suspend
sales or withdraw the offering of Shares entirely, or to modify or cancel
this Agreement, which shall be construed in accordance with the laws of the
State of Iowa. All sales shall be subject to the terms and provisions set
forth in the Fund's then current Prospectus.
11. No person is authorized to make any representation concerning the Fund or
its Shares except those contained in the then current Prospectus, Statement
of Additional Information or any such information as may be released by the
Fund as information expressly supplemental to such Prospectus or Statement
of Additional Information. In purchasing Shares through us you shall rely
solely on the representations contained in the then current Prospectus,
Statement of Additional Information and supplemental information previously
mentioned.
12. Additional copies of any Prospectus, Statement of Additional Information or
supplemental information issued by us will be supplied by us to Selling
Group members in reasonable quantities upon request.
13. In no transaction shall you have any authority whatsoever to act as agent
of the Fund or of us or of any other Selling Group member. Nothing in this
agreement shall constitute either party the agent of the other or
constitute you or the Fund the agent of the other. In all transactions in
the Shares between you and us, we are acting as agent for Fund and not as
principal.
14. All communications to us shall be sent to 000 Xxxx Xxxxxx, Xxx Xxxxxx, Xxxx
00000-0000. Any notice to you shall be duly given if mailed or
electronically sent to you at your address as registered from time to time
with the NASD.
15. 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 not.
16. We reserve the right, from time to time, to modify the sales commission you
are entitled to receive under paragraph 5.
17. You agree to indemnify the Fund and us and to hold the Fund and us harmless
from any damages or expenses resulting from any wrongful act or omission,
not in compliance with this Agreement by you or any of your employees,
representatives or agents.
18. The parties to this Agreement hereby agree to indemnify and hold harmless
each other, their officers and directors, and any person who is or may be
deemed to be a controlling person of each other, from and against any
losses, claims, damages liabilities or expenses (including reasonable fees
of counsel) to which any such person or entity may become subject insofar
as such losses, claims, damages, liabilities or expenses (or actions in
respect thereof) arise out of or are based upon (a) any untrue statement or
alleged untrue statement of material fact, or any omission or alleged
omission to state a material fact made or omitted by it, or (b) any willful
misfeasance or gross misconduct by it in the performance of its duties and
obligations thereunder.
19. This agreement shall become effective upon receipt by us of a signed copy
hereof, and shall supersede any and all prior Selling Group Agreements
relating to Fund Shares. All amendments to this Agreement shall take effect
with respect to and on the date of any orders placed by you after the date
set forth in the notice of amendment sent to you by the undersigned.
20. No obligation not expressly assumed by us in this Agreement shall be
implied.
21. This Agreement is in all respects subject to Section 26 of the Rules of
Fair Practice of the NASD that shall control any provisions to the contrary
in this Agreement.
22. If the foregoing represents your understanding, please so indicate by
signing in the proper space below.
PRINCOR FINANCIAL SERVICES CORPORATION
By:___________________________________
Title:________________________________
We accept the offer set forth above, which constitutes a Selling Group Agreement
with us.
BY:
____________________________________________________
Signature
____________________________________________________
Please type or print name
TITLE:______________________________________________
MEMBER:_____________________________________________
ADDRESS:____________________________________________
DATE:_______________________________________________
Please sign the Selling Group Agreement in duplicate and return both copies to
Princor Financial Services Corporation. We will return an original executed copy
for your files.
