Exhibit (e)(2)
Sales Agreement covering shares of capital stock and/or beneficial interest of
THE XXXXXXXX MUTUAL FUNDS
Xxxxxxxx Capital Fund, Inc.
Xxxxxxxx Cash Management Fund, Inc.
Xxxxxxxx Common Stock Fund, Inc.
Xxxxxxxx Communications and Information Fund, Inc.
Xxxxxxxx Frontier Fund, Inc.
Xxxxxxxx Global Fund Series, Inc.
Xxxxxxxx Growth Fund, Inc.
Xxxxxxxx High-Yield Bond Series
Xxxxxxxx Income and Growth Fund, Inc.
Xxxxxxxx Investment Grade Fixed Income Fund, Inc.
Xxxxxxxx Municipal Fund Series, Inc.
Xxxxxxxx Municipal Series Trust
Xxxxxxxx New Jersey Municipal Fund, Inc.
Xxxxxxxx Pennsylvania Municipal Fund Series
Xxxxxxxx Time Horizon/Harvester Series, Inc.
Xxxxxxxx U.S. Government Securities Series
Xxxxxxxx Value Fund Series, Inc.
between
XXXXXXXX ADVISORS, INC.
and
________________________________________________________________________________
Dealer
The Dealer named above and Xxxxxxxx Advisors, Inc., exclusive agent for
distribution of shares of capital stock of Xxxxxxxx Capital Fund, Inc., Xxxxxxxx
Cash Management Fund, Inc., Xxxxxxxx Common Stock Fund, Inc., Xxxxxxxx
Communications and Information Fund, Inc., Xxxxxxxx Frontier Fund, Inc.,
Xxxxxxxx Global Fund Series, Inc., Xxxxxxxx Growth Fund, Inc., Xxxxxxxx Income
and Growth Fund, Inc., Xxxxxxxx Investment Grade Fixed Income Fund, Inc.,
Xxxxxxxx Municipal Fund Series, Inc., Xxxxxxxx New Jersey Municipal Fund, Inc.,
Xxxxxxxx Time Horizon/Harvester Series, Inc., and Xxxxxxxx Value Fund Series,
Inc., and shares of beneficial interest of Xxxxxxxx High-Yield Bond Series,
Xxxxxxxx Municipal Series Trust, Xxxxxxxx Pennsylvania Municipal Fund Series,
and Xxxxxxxx U.S. Government Securities Series, agree to the terms and
conditions set forth in this agreement.
Dealer Signature Xxxxxxxx Advisors, Inc. Acceptance
_________________________________ ____________________________________
Principal Officer Xxxxxxx X. Xxxxxxx, President
_________________________________ XXXXXXXX ADVISORS, INC.
Address 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
_________________________________
Employer Identification No.
____________________________________
Date
The Dealer and Xxxxxxxx Advisors, Inc. ("SAI"), as exclusive agent for
distribution of Class A, Class B*, Class C, Class D, and Class R* Shares (as
described in the "Policies and Procedures," as set forth below) of Capital Stock
and/or Class A, Class B*, Class C, Class D, and Class R* Shares of beneficial
interest (collectively, the "Shares") of Xxxxxxxx Capital Fund, Inc., Xxxxxxxx
Cash Management Fund, Inc., Xxxxxxxx Common Stock Fund, Inc., Xxxxxxxx
Communications and Information Fund, Inc., Xxxxxxxx Frontier Fund, Inc.,
Xxxxxxxx Global Fund Series, Inc., Xxxxxxxx Growth Fund, Inc., Xxxxxxxx
High-Yield Bond Series, Xxxxxxxx Income and Growth Fund, Inc., Xxxxxxxx
Investment Grade Fixed Income Fund, Inc., Xxxxxxxx Municipal Fund Series, Inc.,
Xxxxxxxx Municipal Series Trust, Xxxxxxxx New Jersey Municipal Fund, Inc.,
Xxxxxxxx Pennsylvania Municipal Fund Series, Xxxxxxxx Time Horizon/Harvester
Series, Inc., Xxxxxxxx U.S. Government Securities Series, Xxxxxxxx Value Fund
Series, Inc. and/or any other mutual fund for which SAI is exclusive agent for
distribution (herein, together with any series thereof, called the Funds), agree
as follows:
1. The Dealer agrees to comply with the attached "Policies and Procedures"
with respect to sales of Funds offering five classes of shares, as set
forth below.
2. An order for Shares of one or more of the Funds, placed by the Dealer with
SAI, 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 the current
prospectus and 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. SAI will make a reasonable
effort to notify the Dealer of any redetermination or suspension of the
current public offering price, but SAI 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
and Statement of Additional Information. On each purchase of Class A
Shares, SAI 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 or capital gain distributions 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 SAI on behalf of the Fund, the Dealer agrees to
buy Shares only through SAI and not from any other sources and to sell
shares only to SAI, the Fund, or its redemption agent, and not to any other
purchasers.
6. By signing this Agreement, both SAI 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 11 hereof.
Each party shall comply with all applicable law and applicable rules,
including those of the National Association of Securities Dealers, Inc.,
and specifically to observe the following provisions:
(a.) Neither SAI nor the Dealer shall withhold placing customers' orders
for Shares so as to profit
itself as a result of such withholding.
(b.) SAI 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 SAI other than
for investment, except for the purpose of covering purchase orders
already received.
(c.) SAI 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, quoted by or for the Fund, but the
Dealer shall not be prevented from selling Shares for the account of a
record owner to SAI, 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 Shares are repurchased by a Fund or by SAI as its agent, or are
tendered for redemption within seven business days after confirmation
by SAI of the original purchase order of the Dealer for such Shares,
(i) the Dealer shall forthwith refund to SAI the full concession
allowed to the Dealer on the original sales and (ii) SAI shall
forthwith pay to the Fund SAI's share of the "sales charge" on the
original sale by SAI, and shall also pay to the Fund the refund which
SAI received under (i) above. The Dealer shall be notified by SAI of
such repurchase or redemption within 10 days of the date that such
redemption or repurchase is placed with SAI, the Fund or its authorized
agent. Termination or cancellation of this Agreement shall not relieve
the Dealer or SAI from the requirements of this clause (d).
(e.) The Dealer 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.
7. (a) SAI shall be entitled to a contingent deferred sales charge
("CDSC") on redemptions within six years of purchase on any Class B
Shares sold, within 18 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 CDSC on redemptions within 18 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, Class B,
Class C, or Class D Shares are held at Xxxxxxxx Data Corp. ("SDC") in
the Dealer's name, the Dealer agrees that by the 10th day of each month
it will furnish to SDC a report of each redemption in the preceding
month to which a CDSC was applicable, accompanied by a check payable to
SAI in payment of the CDSC due.
(b) If, with respect to a redemption of any Class A, Class B, Class C,
Class D, or Class R Shares sold by the Dealer, the CDSC is waived
because the redemption qualifies for a waiver as set forth in the
Fund's prospectus or Statement of Additional Information, the Dealer
shall remit to SAI promptly on notice an amount equal to the payment or
a portion of the payment made by SAI to the Dealer at the time of sale
with respect to such Class A, Class B, Class C, Class D, or Class R
Shares.
(c) SAI shall be entitled to a CDSC on redemptions within twelve months of
the initial purchase of Class R Shares by an investor. With respect to
omnibus accounts in which Class R Shares are held at 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 CDSC
was applicable, accompanied by a check payable to SAI in payment of
the CDSC due.
8. After a payment option (i.e., 1% up-front payment with servicing fee
commencing in year two or no up-front payment with servicing and
distribution fees commencing from initial purchase) has been selected with
respect to an eligible retirement plan account that is purchasing or has
purchased Class R Shares, the Dealer may not change that option with
respect to such retirement plan account without the consent of SAI. In
addition, no up-front payment shall be paid to any Dealer in connection
with the purchase of Class R Shares by an investor to the extent that such
purchase is made within 30 days of a redemption of another class of shares
by such investor.
9. In all transactions between SAI and the Dealer under this Agreement, the
Dealer will act as principal in purchasing from or selling to SAI. 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 SAI, and the Dealer is
not authorized in any manner to act for any Fund or SAI or to make any
representations on behalf of SAI. 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 SAI to the
Dealer over the signature of SAI.
10. SAI 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 SAI.
11. 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 fifth day following the date on which such notice was
given. SAI 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 upon telephonic or
electronic confirmation of transmission if sent by facsimile to the other
party at his or its address as shown herein.
12. 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
SAI 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.
* Class B and Class R Shares are not available for Xxxxxxxx New Jersey
Municipal Fund, Inc., Xxxxxxxx Pennsylvania Municipal Fund Series or any
Series of Xxxxxxxx Municipal Fund Series, Inc. or Xxxxxxxx Municipal Series
Trust. In addition, Class R Shares are not available in any Series of
Xxxxxxxx Time Horizon/Harvester Series, Inc.
POLICIES AND PROCEDURES
In connection with the offering by the Funds of five classes of shares1,
one subject to a front-end sales charge and a service fee ("Class A Shares"),
one subject to a service fee, a distribution fee, no front-end sales charge, and
a contingent deferred sales charge on redemptions within six years of purchase
("Class B Shares"), one subject to a service fee, a distribution fee, a
front-end sales charge, and a contingent deferred sales charge on redemptions
within eighteen months of purchase ("Class C Shares"), one subject to a service
fee, a distribution fee, no front-end sales charge, and a contingent deferred
sales charge on redemptions within one year of the date of purchase ("Class D
Shares")2, and one subject to a service fee, a distribution fee, no front-end
sales charge, and a contingent deferred sales charge on redemptions made within
one year of the date of initial plan purchase ("Class R Shares")3, 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:
0.Xx purchase order may be placed for Class D Shares or Class R Shares
unless the investor meets one of the qualifications provided for in
Footnotes 2 and 3, respectively, below. The Dealer is solely responsible
for complying with this restriction.
0.Xx 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 or her 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 charge on Class A Shares may
determine that payment of such a reduced front-end sales charge 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 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 qualify for a discount from the maximum sales
charge) because the front-end sales charge is lower than on Class A Shares and
the contingent deferred sales charge on such Shares is only 1%, and it does not
apply if the investor owns his or her Shares for at least 18 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 charge, the investor may, depending
on the amount of the purchase, pay an amount greater than the sales charge and
service fee attributable to Class A Shares.
In addition, certain of the Funds also offer Class R Shares to certain
eligible retirement plans as set forth in the applicable prospectuses ("Eligible
Retirement Plans"). There are instances when one
class of shares may be more appropriate than another. The Dealer must consider
the specific circumstances of the Eligible Retirement Plan in determining which
class of shares is more appropriate for that plan. For example, if an Eligible
Retirement Plan would also be eligible for Class A Shares at net asset value,
the plan may find the lower ongoing servicing fees shares preferable if the plan
intends to own the shares for at least 18 months and does not anticipate
significant purchases in later months or years, thereby minimizing the impact of
the ongoing CDSC. On the other hand, an Eligible Retirement Plan may find the
higher ongoing maintenance fees for Class R Shares preferable if such Eligible
Retirement Plan intends to hold the Class R Shares of a Fund for at least 12
months (thereby eliminating the CDSC on all prior and future purchases of Class
R Shares of that Fund) and anticipates significant, ongoing purchases in later
months and years.
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 Advisors, Inc. at (000) 000-0000.
1. Class B and Class R Shares are not available for Xxxxxxxx New Jersey
Municipal Fund, Inc., Xxxxxxxx Pennsylvania Municipal Fund Series or any
Series of Xxxxxxxx Municipal Fund Series, Inc. or Xxxxxxxx Municipal Series
Trust. In addition, Class R Shares are not available in any Series of
Xxxxxxxx Time Horizon/Harvester Series, Inc.
2. Class D Shares are only available (1) to existing Class D Shareholders, (2)
if the Dealer maintains an omnibus account at Xxxxxxxx Data Corp., or (3)
pursuant to a 401(k) or other retirement plan program for which Class D
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.
3. Class R Shares are available only to employee benefit plans that have at
least $500,000 invested in Xxxxxxxx Funds or 50 eligible employees. In
addition, Class R Shares are not available to Section 403(b) plans
sponsored by public educational institutions and plans with more than $20
million in assets (at the time of initial investment).