4-4
SELLING AGREEMENT
BETWEEN
THE BERWYN FUNDS
AND
BERWYN FINANCIAL SERVICES
THIS AGREEMENT entered into the 4th day of February, 1999 by and between
The Berwyn Funds, a Delaware Business Trust with its principal office located at
0000 Xxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxx 00000 (the "Fund") and Berwyn
Financial Services, Inc., a Pennsylvania corporation with its principal office
located at 0000 Xxxxxxxxx Xxxxxx, Xxxxxx Xxxxxxxxxxxx 00000 (the "Distributor").
W I T N E S S E T H :
In consideration of the mutual convenants and agreements of the parties
hereto, the parties intending to be bound, mutually covenant and agree with each
other as follows:
1. The Fund hereby appoints the Distributor as agent of the Fund to effect
the sale and public distribution of portfolio series of the Fund.
2. The Distributor shall not be the exclusive agent for the Fund in sale
of its shares. The Distributor shall be a selling agent for the Fund in all
jurisdictions that require the shares of the Fund to be sold through
broker-dealers and/or issuer-dealers. In those jurisdictions, however, the Fund
may also sell shares through other broker-dealers. Also, where permitted by law
the Fund will sell its shares directly to the public.
3. The Fund hereby authorizes the Distributor to sell its
shares in accordance with the following schedule of prices;
The applicable price will be the net asset value per share next effective
after receipt and acceptance by the Fund of a proper offer to purchase,
determined in accordance with the Declaration of Turst, By-Laws,
Registration Statement and
Prospectus of the Fund.
4. Orders for the purchase of shares placed by the Distributor shall be
subject to the provisions of paragraphs (f) and (g) of Section 26 of the Rules
of Fair Practice of the NASD, the provisions of which are hereby incorporated by
reference.
5. The Fund agrees to prepare and file registration statements with the
Securities and Exchange Commission and the Securities Departments of the various
states and other jurisdictions in which the shares may be offered, at its own
expense, and do such other things and to take such other actions as may be
mutually agreed upon by and between the parties as shall be reasonably necessary
in order to effect the registration and the sale of the Fund's shares. The
Distributor shall cooperate with the Fund in the Preparation and filing of
applications for registration and qualification of the shares under applicable
law.
6. At its own expense, the Fund shall print and provide the Distributor
with such quantities of its current Prospectus, Statements of Additional
Information and reports to stockholders as the Distributor may reasonably
request in connection with its responsibilities under this Agreement.
7. Normally, the Fund shall not exercise any direction or control over the
time and place of solicitation, the persons to be solicited, or the manner of
solicitation; but the Distributor agrees that solicitations shall be in a form
acceptabe to the Fund and shall be subject to such terms and conditions as may
be prescribed from time to time by the Fund, the Registration Statement, the
Prospectus, the Articles of Incorporation, and By-Laws, and shall not violate
any provision of the laws of the Untied States or any jurisdictions to which
solicitations are subject, or violate any rule or regulation promulgated by any
lawfully constituted authority to which the Fund or Distributor may be subject.
8. (a) The Fund appoints and designates the Distributor as agent of the
Fund and the Distributor accepts such appointment as such agent, to repurchase
shares of the Fund in accordance with the provisions of the Articles of
Incorporation and its By-Laws. The Distributor shall not be the exclusive agent
for repurchase of shares.
(b) In connection with such redemptions or repurchases the Fund
authorizes and designates the Distributor to take any action, to make any
adjustments in net asset value, and to make any arrangements for the payment of
the redemption or repurchase price authorized or permitted to be taken or made
in accordance with the Investment Company Act of 1940 and as set forth in the
By-Laws and then current Prospectus.
(c) The authority of the Distributor under this paragraph 8 may, with
the consent of the Fund, be redelegated in whole or in party to another person
or firm.
(d) The authority granted in this paragraph 8 may be suspended by the
Fund at any time or from time to time pursuant to the provisions of its Articles
of Incorporation until further notice to the Distributor. The President or
Secretary of the Fund shall have the power granted by said provisions. After any
such suspension the authority granted to the Distributor by this paragraph 8
shall be reinstated only by a written instrument executed by the Fund's
President or Secretary.
9. The Distributor shall keep and maintain adequate records in respect of
its activities which further the sale of shares.
10. The Distributor agrees that it will not place orders for more shares
than are required to fill the requests received by it as agent of the Fund and
that it will expeditiously transmit all such orders to the Fund.
11. This Agreement shall become effective April 1, 1999 and shall continue
in effect for a period of more than one year from its effective date only as
long as such continuance is approved, at least annually, by the Board of
Trustees of the Fund, including a majority of those Trustees who are not
"interested persons" of any party to this Agreement voting person at a meeting
called for the purpose of voting or such approval. This Agreement may be
terminated by either party hereto upon thirty (30) days' written notice to the
other party. This Agreement shall automatically terminate in the event of its
assignment by the Distributor unless the United States Securities and Exchange
Commission has issued an order exempting the Fund and Distributor from the
provisions of the Investment Company Act of 1940, as amended, which would
otherwise have effected the termination of this Agreement.
12. No amendment to this Agreement shall be executed or become effective
unless its terms have been approved: (a) by a majority of the trustees of the
Fund or by the vote of a majority of the outstanding voting securities of the
Fund, and (b) by a majority of those trustees who are not interested persons of
the Fund or of any party to this Agreement.
13. The Fund and the Distributor hereby each agree that all literature and
publicity issued by either of them referring directly or indirectly to the Fund
or to the Distributor shall be submitted and receive the approval of the Fund
and the Distributor before the same may be used by either party.
14. The Distributor agrees to use its best efforts in effecting the sale
and public distribution of the shares of the Fund and to perform its duties in
redeeming the shares of the Fund, but nothing contained in this Agreement shall
make the Distributor or any of its officers and trustees or shareholders liable
for any loss sustained by the Fund or the Fund's officers, trustees or
shareholders, or by any other person on account of any act done or omitted to be
done by the Distributor under this Agreement; provided, that nothing herein
contained shall protect the Distributor against any liability to the Fund or to
any of its shareholders to which the Distributor would otherwise be subject by
reason of willful misfeasance, bad faith, or gross negligence in the performance
of its duties as Distributor or gross negligence in the performance of its
duties as Distributor or by reason of its reckless disregard of its obligations
or duties as Distributor under this Agreement. Nothing in this Agreement shall
protect the Distributor from any liabilities which it may have under the
Securities Act of 1933 or the Investment Company Act of 1940.
15. As used in this Agreement the terms `interested persons,"
"assignment," and "majority of the outstanding voting securities" shall have the
respective meanings specified in the Investment Company Act of 1940 as now in
effect.
16. This Agreement shall be construed in accordance with the Laws of the
Commonwealth of Pennsylvania, except to the extent such laws are preempted by
the Investment Company Act of 1940.
17. Any notice required to be given thereunder shall be sent via first
class mail to the address of the party as set forth above.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized officers of the day and year above written.
Attest: The Berwyn Funds
Xxxxx X. Xxxx Xxxxxx X. Xxxxxx
Secretary President
Attest: Berwyn Financial Services, Inc.
Xxxxxx X. Xxxxxx Xxxxx X. Xxxx
Secretary President
