Exhibit to Form N-1A
Exhibit (6)(a) Underwriting Agreement
UNDERWRITING AGREEMENT
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THIS AGREEMENT, dated as of the __________ day of _________________, 1995 by
and between The Xxxxxxx Funds (the "Trust"), including any future series or
classes that may be subsequently created, and Fund/Plan Broker Services, Inc.
("FPBS").
WHEREAS, the Trust is an investment company registered under the Investment
Company Act of 1940, as amended (the "Act"); and
WHEREAS, the Trust is authorized to issue separate series of shares
representing interests in separate investment portfolios (the "Series"), which
Series are identified on Schedule "B" attached hereto, and which Schedule "B"
may be amended from time to time by mutual agreement of the Trust and FPBS; and
WHEREAS, FPBS is a broker-dealer registered with the Securities and Exchange
Commission and a member in good standing of the National Association of
Securities Dealers, Inc. (the "NASD"); and
WHEREAS, the Trust and FPBS are desirous of entering into an agreement
providing for the Underwriting and Marketing Support Services by FPBS of shares
of the Trust (the "Shares");
NOW, THEREFORE, in consideration of the promises and agreements of the
parties contained herein, the parties agree as follows:
1. APPOINTMENT.
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The Trust hereby appoints FPBS as its exclusive agent for the distribution
of the Shares, and FPBS hereby accepts such appointment under the terms of
this Agreement. The Trust agrees that it will not sell any shares to any
person except to fill orders for the shares received through FPBS; provided,
however, that the foregoing exclusive right shall not apply: (a) to shares
issued or sold in connection with the merger or consolidation of any other
investment company with the Trust or the acquisition by purchase or
otherwise of all or substantially all of the assets of any investment
company or substantially all of the outstanding shares of any such company
by the Trust; (b) to shares which may be offered by the Trust to its
stockholders for reinvestment of cash distributed from capital gains or net
investment income of the Trust; or (c) to shares which may be issued to
shareholders of other funds who exercise any exchange privilege set forth in
each Series' Prospectus. Notwithstanding any other provision hereof, the
Trust may terminate, suspend, or withdraw the offering of the Shares
whenever, in its sole discretion, it deems such action to be desirable.
2. SALE AND REPURCHASE OF SHARES.
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(a) FPBS will have the right, as agent for the Trust, to sell Shares to the
public against orders therefor at the public offering price (as defined
in sub-paragraph 2(d) hereof).
(b) FPBS will also have the right, as agent for the Trust, to sell Shares
at their net asset value to such persons as may be approved by the
Board of Trustees of the Trust, all such sales to comply with the
provisions of the Act, the Securities Act of 1933 and the rules and
regulations of the Securities and Exchange Commission promulgated
thereunder.
(c) FPBS will also have the right to take, as agent for the Trust, all
actions which, in FPBS's judgment, are necessary to carry into effect
the distribution of the Shares.
(d) The public offering price shall be the net asset value of Shares then
in effect plus any applicable sales charge set forth in the Series'
prospectuses.
(e) The net asset value of the Shares shall be determined in the manner
provided in the then current Prospectus and Statement of Additional
information relating to the Shares (the "Prospectus"), and when
determined shall be applicable to transactions as provided for in the
Prospectus. The net asset value of the Shares shall be calculated by
the Trust or by another entity on behalf of the Trust. FPBS shall have
no duty to inquire into or liability for the accuracy of the net asset
value per Share as calculated.
(f) On every sale, the Trust shall receive the applicable net asset value
of the Shares promptly.
(g) Upon receipt of purchase instructions, FPBS will transmit such
instructions to the Trust or its transfer agent for registration of the
Shares purchased.
(h) Nothing in this Agreement shall prevent FPBS or any affiliated person
(as defined in the Act) of FPBS from acting as underwriter or
distributor for any other person, firm or corporation (including other
investment companies) or in any way limit or restrict FPBS or such
affiliated person from buying, selling or trading any securities for
its or their own account or for the accounts of others for whom it or
they may be acting; provided, however, that FPBS expressly agrees that
it will not for its own account purchase any shares of the Trust except
for investment purposes and that it will not for its own account sell
any such shares except by redemption of such shares by the Trust, and
that it will undertake no activities which, in its judgment, will
adversely affect the performance of its obligations to the Trust under
this Agreement.
(i) FPBS may repurchase Shares at such prices and upon such terms and
conditions as shall be specified in the Prospectus.
3. RULES OF SALE OF SHARES.
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FPBS does not agree to sell any specific number of Shares. FPBS, as agent
for the Trust, undertakes to sell Shares on a best efforts basis only
against orders therefor.
The Trust reserves the right to refuse at any time or times to sell any of
its Shares for any reason deemed adequate by it.
4. RULES OF NASD, ETC.
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(a) FPBS will conform to the Rules of Fair Practice of the NASD and the
securities laws of any jurisdiction in which it sells, directly or
indirectly, any Shares.
(b) FPBS will require each dealer with whom FPBS has a selling agreement to
conform to the applicable provisions of the Prospectus, with respect to
the public offering price of the Shares, and FPBS shall not cause the
Trust to withhold the placing of purchase orders so as to make a profit
thereby.
(c) The Trust agrees to furnish to FPBS sufficient copies of any
agreements, plans or other materials it intends to use in connection
with any sales of Shares in adequate time for FPBS to file and clear
them with the proper authorities before they are put in use, and not to
use them until so filed and cleared.
(d) FPBS, at its own expense, will qualify as a dealer or broker, or
otherwise, under all applicable state or federal laws required in order
that the Shares may be sold in such states as may be mutually agreed
upon by the parties.
(e) FPBS shall not make, or authorize any representative, Service
Organization, broker or dealer to make, in connection with any sale or
solicitation of a sale of the Shares, any representations concerning
the Shares except those contained in the Prospectus covering the Shares
and in sales materials approved by FPBS and the Trust as information
supplemental to such Prospectus. Copies of the Prospectus will be
supplied by the Trust to FPBS in reasonable quantities upon request.
(f) FPBS shall not act as a conduit by paying any asset based sales charge
to any member in excess of NASD Rules (currently 0.75%).
5. RECORDS TO BE SUPPLIED BY THE TRUST.
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The Trust shall furnish to FPBS copies of all information, financial
statements and other papers which FPBS may reasonably request for use in
connection with the distribution of the Shares, and this shall include, but
shall not
be limited to, one certified copy, upon request by FPBS, of all financial
statements prepared for the Trust by independent public accountants.
6. EXPENSES.
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(a) The Trust will bear the following expenses:
(i) preparation, setting in type, and printing of sufficient copies
of the prospectuses and statements of additional information for
distribution to shareholders, and the distribution of same to the
shareholders;
(ii) preparation, printing and distribution of reports and other
communications to shareholders;
(iii) registration of the Shares under the federal securities laws;
(iv) qualification of the Shares for sale in the jurisdictions
mutually agreed upon by the Trust and the FPBS;
(v) maintaining facilities for the issue and transfer of the Shares;
(vi) supplying information, prices and other data to be furnished by
the Trust under this Agreement; and
(vii) any original issue taxes, transfer taxes and professional
privilege taxes applicable to the sale or delivery of the Shares
or certificates therefor.
(b) Xxxxxxx Partners, Inc. will pay all other expenses incident to the sale
and distribution of the Shares sold hereunder.
7. FEE.
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For its services under this Agreement, FPBS shall be entitled to the fees
contained in Schedule "A" attached hereto, as amended from time to time. All
such fees will be paid by Xxxxxxx Partners, Inc. The services provided
include acting as primary underwriter/distributor of the Trust and
licensing/regulatory agent for personnel who are registered as FPBS
representatives. These fees will include the renewal of the NASD license and
the State Securities licenses for representatives in states requested by the
Trust. These fees will also cover the expenses and personnel required to
maintain the regulatory books and records of FPBS in connection with this
agreement on behalf of the Trust.
(a) Xxxxxxx Partners, Inc. will indemnify FPBS for the actions of its
employees registered with the NASD as FPBS representatives and will
undertake to see that the rules and regulations are followed with any
and all sales presentations by such employees.
8. DUTIES AND OBLIGATIONS OF FPBS.
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(a) Subject to the succeeding provisions of this section and Schedule "B",
FPBS shall:
1. Provide its own office space, facilities, equipment and personnel
for the performance of duties under this Agreement.
2. Maintain records as the distributor as requested and as mutually
agreed upon.
3. Respond to all inquiries or other communications of shareholders of
the Fund and its representatives.
4. Attend marketing strategy and Board of Trustees meetings as
requested.
9. LIABILITY OF FPBS.
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(a) FPBS, its directors, officers, employees, shareholders and agents shall
not be liable for any error of judgment or mistake of law or for any
loss suffered by the Trust in connection with the performance of this
Agreement, except a loss resulting from a breach of fiduciary duty with
respect to the receipt of compensation for services or a loss resulting
from willful misfeasance, bad faith or negligence on the part of FPBS
in the performance of its obligations and duties or by reason of its
reckless disregard of its obligations and duties
under this Agreement. The Trust agrees to indemnify and hold harmless
FPBS against any and all liability, loss, damages, costs or expenses
(including counsel fees) which FPBS may incur or be required to pay
hereafter, in connection with any action, suit or other proceeding,
whether civil or criminal, before any court or administrative or
legislative body, in which FPBS may be involved as a party or otherwise
or with which FPBS may be threatened, by reason of the offer or sale of
the Trust shares prior to the execution of this Agreement which is not
due to FPBS's lack of reasonable care.
(b) Any person, even though also a director, officer, employee, shareholder
or agent of FPBS, who may be or become an officer, trustee, employee or
agent of the Trust, shall be deemed, when rendering services to the
Trust or acting on any business of the Trust (other than services or
business in connection with FPBS's duties hereunder), to be rendering
such services to or acting solely for the Trust and not as a trustee,
officer, employee, shareholder or agent, or one under the control or
direction of FPBS even though paid by it.
(c) The Trust agrees to indemnify and hold harmless FPBS, and each person,
if any, who controls FPBS within the meaning of Section 15 of the
Securities Act of 1933 (the "Securities Act") or Section 20 of the
Securities Exchange Act of 1934 (the "Exchange Act") against any and
all losses, claims, damages and liabilities, joint or several
(including any reasonable investigative, legal and other expenses
incurred in connection therewith) to which they, or any of them, may
become subject under the 1940 Act, the Securities Act, the Exchange Act
or other federal or state law or regulation, at common law or otherwise
insofar as such losses, claims, damages or liabilities (or actions,
suits or proceedings in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact
contained in a Prospectus, Statement of Additional Information,
supplement thereto, sales literature or other written information
prepared by the Trust and furnished by it to FPBS for FPBS's use
hereunder, disseminated by the Trust or arise out of or are based upon
any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading. Such indemnity shall not, however, inure to the
benefit of FPBS (or any person controlling FPBS) on account of any
losses, claims, damages or liabilities (or actions, suits or
proceedings in respect thereof) arising from the sale of the shares of
the Trust to any person by FPBS (i) if such untrue statement or
omission or alleged untrue statement or omission was made in the
Prospectus, Statement of Additional Information, or supplement, sales
or other literature, in reliance upon and in conformity with
information furnished in writing to the Trust by FPBS specifically for
use therein or (ii) if such losses, claims, damages or liabilities
arise out of or are based upon an untrue statement or omission or
alleged untrue statement or omission in the Prospectus, Statement of
Additional Information, or supplement, sales or other literature, if
the Trust shall correct the untrue statement or omission or the alleged
untrue statement or omission which is the basis of the loss, claim,
damage or liability for which indemnification is sought and a copy of
the Prospectus was not sent or given to such person at or before the
confirmation of the sale to such person, unless such failure to deliver
the Prospectus was a result of noncompliance by the Trust with the
obligation to furnish copies of the Prospectus and any supplements
thereto.
(d) FPBS agrees to indemnify and hold harmless the Trust, each person, if
any, who controls the Trust within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, insofar as such
losses, claims, damages or liabilities arise out of or are based upon
any untrue statement or omission or alleged untrue statement of a
material fact contained in a Prospectus or Statement of Additional
Information or any supplement thereto, or arise out of or are based
upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, if based upon information furnished in writing
to the Trust by FPBS specifically for use therein.
10. MAINTENANCE OF INSURANCE COVERAGE.
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FPBS shall, at its option, be a named insured party on the Trust's Errors &
Omissions policy and the Trust's Fidelity bond, both of which shall, at
FPBS's option, include coverage of FPBS's officers and employees. FPBS shall
pay its allocable share of the cost of such policies in accordance with the
provisions of the Act. The scope of coverage and amount of insurance limits
applicable to the Trust on such policies shall also be made applicable to
FPBS.
11. TERMINATION OF THIS AGREEMENT.
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This Agreement shall automatically terminate in the event of its assignment.
This Agreement may be terminated
with respect to the Trust at any time, without payment of any penalty, by
vote of a majority of the members of the Board of Trustees of the Trust who
are not interested persons of the Trust or by vote of a majority of the
outstanding voting securities of the Trust or by FPBS on one hundred and
eighty (180) days written notice to the other party.
12. EFFECTIVE PERIOD OF THIS AGREEMENT.
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This Agreement shall be effective on the date noted above and shall remain
in full force and effect until October 31, 1996 (unless terminated as set
forth in Paragraph 11), and from year to year thereafter, but only so long
as such continuance is specifically approved at least annually by:
(i) the Board of Trustees of the Trust or by a majority of the outstanding
voting securities of the Trust; and
(ii) by a majority of the Trustees of the Trust who are not parties to this
Agreement or interested persons of any such party by vote cast in
person at a meeting called for the purpose of voting on such approval.
The provisions of paragraph 8 hereof shall survive the termination of this
Agreement.
13. AMENDMENTS.
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No amendments to this Agreement shall be executed or become effective unless
its terms have been approved:
(a) by a majority of the Trustees of the Trust or by the vote of a majority
of the outstanding voting securities of the Trust; and
(b) by a majority of those trustees who are not interested persons of the
Trust or of any party to this Agreement.
14. REPORTS.
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FPBS shall prepare reports for the Board of Trustees of the Trust on a
quarterly basis showing such information as from time to time shall be
reasonably requested by such Board.
15. SEVERABILITY.
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In the event any provision of this Agreement is determined to be void or
unenforceable, such determination shall not affect the remainder of the
Agreement, which shall continue to be in force.
16. GOVERNING LAW.
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This Agreement shall be governed by the laws of the Commonwealth of
Pennsylvania.
IN WITNESS WHEREOF, the Trust and FPBS have each caused this Agreement to be
signed in duplicate, as of the day and year first above written.
The Xxxxxxx Funds Fund/Plan Broker Services, Inc.
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By: E. Xxxxxx XxXxxxxx, President Xxxxxxx X. Xxxxx, President
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Attest: Xxxxx X. Xxxx, Secretary Attest: Xxxxx X. Xxxxx, Secretary
(SEAL) (SEAL)
Xxxxxxx Partners, Inc.
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By: Xxxxxx X. Xxxxxxxx, Vice President
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Attest: Xxxxxxx X. Xxxxxx, Secretary
(SEAL)
SCHEDULE "A"
FUND/PLAN BROKER SERVICES, INC.
MULTIPLE CLASS FEE SCHEDULE
FOR
THE XXXXXXX FUNDS
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The following is Fund/Plan Broker Services, Inc.'s schedule for
Underwriter/Distributor services provided to The Xxxxxxx Funds and as
Licensing/Regulatory Agent for Xxxxxxx Partners, Inc. personnel including
employees who are registered as Fund/Plan Broker Services, Inc. representatives.
These fees will also cover the expenses and personnel required to maintain the
regulatory books and records of Fund/Plan Broker Services, Inc. in connection
with the Underwriting Agreement on behalf of the Trust. All fees for the Xxxxxxx
Classes to be paid by Xxxxxxx Partners, Inc.
. $7,500 Per Year Per Company with one Fund (Initial Series)
. $2,500 Additional Per Year for Each Additional Series or Class
. $1,000 Per Year Per Licensed Representative in 1-2 States
. or $2,500 Per Year Per Licensed Representative up to 30 States
. or $3,500 Per Year Per Licensed Representative in 50 States & DC
. Additional $300 Per Year Per Licensed Representative in Puerto Rico
MARKETING SUPPORT SERVICES
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$2.00 per call includes both Inbound Telemarketing Services and Literature
Fulfillment. Minimum $2,000 per month.
OUT-OF-POCKET EXPENSES
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Fund/Plan Broker Services, Inc. will be reimbursed monthly for all reasonable
out-of-pocket expenses, including telephone, postage, telecommunications,
special reports, continuing education requirements, record retention, special
transportation costs as incurred, and unusual expenses incurred.
ADDITIONAL SERVICES
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Activities of a non-recurring nature such as fund consolidations, mergers or
reorganizations will be subject to negotiation. Any additional/enhanced
services or reports will be quoted upon request.
SCHEDULE "B"
IDENTIFICATION OF SERIES
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Below are listed the Series and Classes of Shares to which services under this
Agreement are to be performed as of the Effective Date of this Agreement:
SERIES
Global Fund
Global Equity Fund
Global Bond Fund
Short-Term Global Income Fund*
U.S. Balanced Fund
U.S. Equity Fund
U.S. Bond Fund
U.S. Cash Management Fund
Non-U.S. Equity Fund
Non-U.S. Bond Fund
CLASSES
Xxxxxxx Fund class
SwissKey Fund class
* Fee and procedures subject to change/review pending definitive structure of
Fund.
This Schedule "B" may be amended from time to time by agreement of the Parties.
