Exhibit (h)(2)
MASTER SELLING AND SERVICING AGREEMENT
[ ], 2002
Ladies and Gentlemen:
In connection with offerings of securities of investment
companies ("Investment Companies") registered under the Investment Company
Act of 1940, as amended (the "1940 Act"), for which we are acting as
distributor or co-distributor, you may be offered the right to act as a
selling agent for the offer and sale of a portion of such securities for
your investor clients and as a servicing agent for the provision of
services to your investor clients thereafter. This will confirm the mutual
agreements (a) between us and you as to the general terms and conditions
applicable to your participation in any such selling agent group and (b)
between the issuer of securities and you as to your obligations as a
servicing agent.
1. Applicability of this Agreement. (a) The terms and
conditions of this Agreement shall be applicable to any offering of
securities ("Securities") of an Investment Company pursuant to a
registration statement filed under the Securities Act of 1933, as amended
(the "Securities Act"), in respect of which CIBC World Markets Corp. is
acting as agent for the offer and sale of Securities and pursuant to which
you have agreed to act as a selling agent ("Selling Agent") and as a
shareholder servicing agent ("Servicing Agent," collectively with Selling
Agent from time to time referred to as "Agent") and has expressly informed
you that such terms and conditions shall be applicable.
(b) Continuous or Delayed Offerings. In the event that any
issuer of Securities whose Offering is covered by paragraph (a) of this
Section 1 elects under Rule 415 of the Securities Act to offer and sell
Securities on a delayed or continuous basis, the terms and conditions of
this Agreement shall be applicable to any such delayed or continuous
offering of Securities.
Any such offering of Securities for which you are acting as an
Agent is hereinafter called an "Offering."
2. Conditions of Offering; Acceptance and Purchases. In
effecting the purchase or sale of Securities, the parties understand and
agree that Agent shall act solely upon instructions by or on behalf of
investors, and that all purchases of securities shall be initiated upon the
instruction and order by or on behalf of the purchaser thereof for such
investor's account and not for the account of Agent. Any Offering will be
subject to delivery of Securities and may be subject to the approval of
certain legal matters by counsel and to the satisfaction of certain other
conditions. We will advise you by telecopy, telex or other form of written
communication ("Written Communication," which term may include a
prospectus) of the particular method and supplementary terms and conditions
(including without limitation the information as to prices and the offering
date referred to in Section 3(b) hereof) of any Offering in which you are
invited to participate as agent. To the extent such supplementary terms and
conditions are inconsistent with any provision herein, such terms and
conditions shall supersede any such provision. Unless otherwise indicated
in any such Written Communication, acceptances and other communications by
you with respect to an Offering should be sent to CIBC World Markets Corp.,
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Attention: Managing Director Alternative Investments Group. We may close
the subscription books at any time in our sole discretion without notice,
and we reserve the right to reject any acceptance in whole or in part.
Unless notified by us or as otherwise provided in any Written
Communication, payment for and delivery of Securities will be made through
the facilities, and subject to the rules and procedures of, the National
Securities Clearing Corporation (NSCC) Fund Settlement, Entry and
Registration Verification System (Fund/SERV System), subject to the
issuer's rights to accept or reject applications as set forth in a Written
Communication.
3. Representations, Warranties and Agreements.
(a) Prospectus Delivery Procedures. We will make available to
you as soon as practicable after sufficient copies are made available to us
by the issuer of the Securities such number of copies of each preliminary
prospectus and of the final prospectus (which terms include any statements
of additional information) relating thereto (and of any statement of
additional information) as you may reasonably request for the purposes
contemplated by the Securities Act and the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and the applicable rules and regulations
of the Securities and Exchange Commission thereunder.
You represent and warrant that you are familiar with Rule
15c2-8 under the Exchange Act relating to the distribution of preliminary
and final prospectuses and agree that you will comply therewith. You agree
to make a record of your distribution of each preliminary prospectus and
when furnished with copies of any revised preliminary prospectus, you will
promptly forward copies thereof to each person to whom you have theretofore
distributed a preliminary prospectus.
You agree that in making offers of Securities you will rely
upon no statement whatsoever, written or oral, other than the statements in
the final prospectus delivered to you by us. You will not be authorized by
the issuer of Securities to give any information or to make any
representation not contained in the prospectus in connection with the sale
of such Securities.
(b) Offer and Sale to the Public. The Offering of Securities is
made subject to the conditions referred to in the prospectus relating to
the Offering and to the terms and conditions set forth in this Agreement,
including that Securities may only be offered to your clients that (i) have
a net worth (together, in the case of a natural person, with assets held
jointly with a spouse) of more than the amount set forth in paragraph
(d)(1)(ii)(A) of Rule 205-3 under the Investment Advisers Act of 1940, as
amended (the "Advisers Act"), currently $1,500,000, as such amount may be
amended from time to time (a "qualified investor") and (ii) complete and
sign an investor certification (in the form provided by the issuer of
Securities) as a condition to purchasing Securities.
With respect to any Offering of Securities, we will inform you
by a Written Communication of the public offering price, selling
commissions and concessions payable to dealers in effect from time to time
and the time when you may commence selling Securities to the public. After
such Offering has commenced, we may change the public offering price,
selling commissions and concessions payable to dealers.
(c) NASD. You represent and warrant that you are actually
engaged in the investment banking or securities business and either are a
member in good standing of the NASD or, if you are not such a member, you
are a foreign bank, dealer or institution not eligible for membership in
the NASD which agrees to make no sales within the United States, its
territories or its possessions or to persons who are citizens thereof or
residents therein, and in making other sales to comply with the NASD's
interpretation with respect to free-riding and withholding. You further
represent, by your participation in an Offering, that you have provided to
us all documents and other information required to be filed with respect to
you, any related person or any person associated with you or any such
related person pursuant to the supplementary requirements of the NASD's
interpretation with respect to review of corporate financing to the extent
that such requirements relate to such Offering.
You agree that, in connection with any purchase or sale of the
Securities wherein a selling concession, discount or other allowance is
received or granted, you will (i) if you are a member of the NASD, comply
with all applicable interpretive material ("IM") and Conduct Rules of the
NASD, including, without limitation, IM 2110-1 (relating to Free-Riding and
Withholding) and Conduct Rule 2740 (relating to Selling Concessions,
Discounts and Other Allowances) or (ii) if you are a foreign bank or dealer
or institution not eligible for such membership, comply with IM 2110-1 and
with Conduct Rules 2730 (relating to Securities Taken in Trade), 2740
(relating to Selling Concessions) and 2750 (relating to Transactions With
Related Persons) as though you were such a member and Conduct Rule 2420
(relating to Dealing with Non-Members) as it applies to a non-member broker
or dealer in a foreign country.
If you are a member of the NASD, you further agree that, prior
to making an offering of Securities to any client, you will comply with
Conduct Rule 2310 (Recommendations to Customers (Suitability)), which
compliance shall include without limitation considering (i) the suitability
of this investment with respect to the client's investment objectives and
personal situation, (ii) factors such as the client's personal net worth,
income, age, risk tolerance and liquidity needs, and (iii) whether the
client's risk profile is suitable for this investment.
If you are a broker or dealer registered under the Exchange
Act, you further agree that in accepting funds from clients you will comply
with Rule 15c2-4 under the Exchange Act.
(d) Relationship among Distributor and Agents. We shall have
full authority to take such action as we deem advisable in all matters
pertaining to any Offering under this Agreement. You are not authorized to
act as agent for us, or the issuer of any Securities in offering Securities
to the public or otherwise. We shall be under no obligation to you except
for obligations assumed hereby or in any Written Communication from us in
connection with any Offering. Nothing contained herein or in any Written
Communication from us shall constitute the Agents an association or
partners with us or with one another. If the Agents, among themselves,
should be deemed to constitute a partnership for federal income tax
purposes, then you elect to be excluded from the application of Subchapter
K, Chapter 1, Subtitle A of the Internal Revenue Code of 1986, as amended,
and agree not to take any position inconsistent with that election. You
authorize us, in our discretion, to execute and file on your behalf such
evidence of that election as may be required by the Internal Revenue
Service. In connection with any Offering you shall be liable for your
proportionate amount of any tax, claim, demand or liability that may be
asserted against you alone or against one or more Agents participating in
such Offering, or against us, based upon the claim that the Agents, or any
of them constitute an association, an unincorporated business or other
entity, including, in each case, your proportionate amount of any expense
incurred in defending against any such tax, claim, demand or liability.
(e) Blue Sky Laws. Upon application to us, we shall inform you
as to any advice we have received from counsel concerning the jurisdictions
in which Securities have been qualified for sale or are exempt under the
securities or blue sky laws of such jurisdictions, but we do not assume any
obligation or responsibility as to your right to sell Securities in any
such jurisdiction.
(f) Compliance with Law. You agree that in selling Securities
pursuant to any Offering (which agreement shall also be for the benefit of
the issuer of such Securities), you will comply with all applicable laws,
rules and regulations, including the applicable provisions of the
Securities Act and the Exchange Act, the applicable rules and regulations
of the Securities and Exchange Commission thereunder, the applicable rules
and regulations of the NASD and the applicable rules and regulations of any
securities exchange or other regulatory authority having jurisdiction over
the Offering. Without limiting the foregoing, (i) you agree that, at all
times since you were invited to participate in an Offering of Securities,
you have complied with the provisions of Regulation M applicable to such
Offering, in each case after giving effect to any applicable exemptions and
(ii) you represent that your incurrence of obligations hereunder in
connection with any Offering of Securities will not result in the violation
by you of Rule 15c3-1 under the Exchange Act, if such requirements are
applicable to you.
(g) Confidentiality. In effecting the transactions contemplated
by this Agreement, the parties understand and agree that client
confidentiality is of paramount importance. We agree that information
relating to your clients will be maintained and administered by a third
party administrator or other agent retained by the issuer of Securities and
not by us. In addition, the parties agree (i) to protect the
confidentiality and security of any information regarding clients of the
other party or any other Agent that any party gains knowledge of and (ii)
to forebear from using such client information for any purpose except as
requested by any governmental or self regulatory agency or as may be
required by any statute, regulation, rule or judicial holding.
4. Investor Services.
(a) Provision of Services. You agree to maintain accounts and
provide certain other services for your clients who have purchased or
otherwise acquired Securities in an Offering subject to this Agreement. In
addition to any services that may be set forth from time to time in any
Written Communication, you agree to provide customary services to your
clients, which shall include: responding to client inquiries concerning the
issuer of any Securities, any repurchase offers conducted by the issuer of
Securities and the transferability of any Securities and assisting in
selecting dividend payment options.
(b) Restrictions on Transfers. You understand that Securities
will be subject to transfer restrictions that permit transfers only to
persons who are qualified investors and agree to provide a certification to
that effect. You agree that (i) you will not make any sales or transfers of
Securities to any of your clients unless you believe that such client is a
qualified investor; (ii) you have implemented procedures designed to enable
you to form a reasonable belief that any transferee of Securities who is a
client is a qualified investor; (iii) you will cooperate with the
Securities and Exchange Commission in the event of any audit or examination
of the qualified investor status of your clients with respect to the
Securities; and (iv) confirmations of any transfer will include a statement
regarding the transfer restrictions applicable to the Securities.
(c) Repurchase Offers. If the Securities covered by this
Agreement are issued by an issuer that intends to conduct quarterly
repurchase offers pursuant to Rule 23c-3 of the 1940 Act, you agree: (i) to
deliver to each client that owns Securities in a timely manner any
applicable repurchase offer material; (ii) to respond to client inquiries
about procedures for tendering Securities; (iii) to tender Securities on
behalf of clients that wish to participate in the repurchase offer; and
(iv) to remit repurchase proceeds to the appropriate clients. In addition,
if the issuer of Securities is required to pro rate repurchase offers, you
will be responsible for determining correct allocations among your clients
of any repurchase proceeds and any Securities not purchased in the
repurchase offer.
(d) Continuous or Delayed Offerings. In the event of an
Offering covered by Section 1(b) hereof, you agree to effectuate
participation therein by your qualified investor clients for which you are
acting as Servicing Agent in accordance with this Agreement, including
making any prospectus or offering material relating thereto available to
such clients on a timely basis.
(e) Compensation. Compensation for the services performed by
you pursuant to this Section 4 will be set forth in a Written
Communication; provided that, except as set forth in a Written
Communication, neither the issuer of Securities nor the Distributor will
have any other obligation to compensate you for costs incurred in
connection with your servicing activities.
5. Indemnification. (a) You agree to indemnify and hold
harmless the Distributor (for purposes of this Section, "Distributor" shall
mean us, our directors, officers, employees and agents, and any person who
is or may be deemed to be a controlling person of Distributor) from and
against any and all losses, claims, damages, liabilities and expenses,
including the reasonable costs of investigation and attorney's fees and
expenses as such expenses are incurred by the Distributor in any action or
proceeding between the parties hereto or between the Distributor and any
third party, to which the Distributor may become subject under the
Securities Act, the Exchange Act, the 1940 Act, the Advisers Act or
otherwise, insofar as any such loss, claim, damage, liability or expense
(or action with respect thereto) is asserted by any person to whom you
offered Securities or who agrees to purchase Securities through you or
otherwise arises from your activities pursuant to this Agreement, except
insofar as such loss, claim, damage, or liability is caused by any untrue
statement or omission with respect to information relating to the
Distributor furnished in writing to the issuer of Securities by the
Distributor expressly for use in the any prospectus or any sales material
relating to an Offering.
(b) Distributor agrees to indemnify and hold harmless Agent
(for the purposes of this Section, "Agent" shall mean you, your directors,
officers, employees and agents, and any person who is or may be deemed to
be a controlling person of Agent) from and against any and all losses,
claims, damages, liabilities or expenses (including the reasonable costs of
investigation and attorney's fees and expenses as such expenses are
incurred by Agent in any action or proceeding between the parties to this
Agreement or between Agent and any third party) to which Agent may become
subject under the Securities Act, the Exchange Act, the 1940 Act, the
Advisers Act or otherwise, insofar as any such loss, claim, damage,
liability or expense (or action with respect thereto) arises out of or is
based on any untrue statement of a material fact contained in any
prospectus or any sales materials relating to an Offering, or arises out of
or is based on the failure to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided, however, that the Distributor's obligation to indemnify and hold
harmless Agent applies only with respect to such statements or omissions of
material fact relating to information about the Distributor furnished in
writing by the Distributor expressly for use in any such prospectus or
sales materials.
6. Termination; Supplements and Amendments. This Agreement
shall continue in full force and effect until terminated by a written
instrument executed by each of the parties hereto; provided, however, that
the terms and conditions set forth in Section 4 (as supplemented by any
Written Communication relating thereto) shall continue in effect until
terminated by a written instrument setting forth the mutual agreements of
any issuer of Securities and you for the disposition of any Securities held
by you for your clients' accounts. This Agreement may be supplemented or
amended by us by written notice thereof to you, and any such supplement or
amendment to this Agreement shall be effective with respect to any Offering
to which this Agreement applies after the date of such supplement or
amendment. Each reference to "this Agreement" herein shall, as appropriate,
be to this Agreement as so amended and supplemented.
7. Successors and Assigns. This Agreement shall be binding on,
and inure to the benefit of, the parties hereto and other persons specified
in Section 1 hereof, and the respective successors and assigns of each of
them.
8. Governing Law. This Agreement and the terms and conditions
set forth herein with respect to any Offering together with such
supplementary terms and conditions with respect to such Offering as may be
contained in any Written Communication from us to you in connection
therewith shall be governed by, and construed in accordance with, the laws
of the State of New York applicable to contracts made and to be performed
within the State of New York.
Please confirm by signing and returning to us the enclosed copy
of this Agreement that your subscription to or your acceptance of any
reservation of any Securities pursuant to an Offering shall constitute (i)
acceptance of and agreement to the terms and conditions of this Agreement
(as supplemented and amended pursuant to Section 5 hereof; together with
and subject to any supplementary terms and conditions contained in any
Written Communication from us in connection with such Offering, all of
which shall constitute a binding agreement between you and us, (ii)
confirmation that your representations and warranties set forth in Section
3 hereof are true and correct at that time, (iii) confirmation that your
agreements set forth in Sections 2 and 3 hereof have been and will be fully
performed by you to the extent and at the times required thereby and (iv)
in the case of any Offering described in Section 3(a) or 3(b) hereof,
acknowledgment that you have requested and received from us sufficient
copies of the final prospectus with respect to such Offering in order to
comply with your undertakings in Section 3(a) or 3(b) hereof.
Very truly yours,
CIBC World Markets Corp.
By: ______________________
Name:
Title:
................................................................(Name of Agent)
By:...............................................................
Name:
Title:
Address:
Telephone:
Fax: