Form of DISTRIBUTION AGREEMENT
Form of
This DISTRIBUTION AGREEMENT (the “Agreement”) is made as of [______], 2023 by and between Xxxxxxxxx Xxxxxx High Yield
Strategies Fund Inc., a Maryland corporation (the “Fund”), and Xxxxxxxxx Berman BD LLC, a Delaware limited liability company (the “Distributor”).
WITNESSETH:
WHEREAS, the Fund is registered under the Investment Company Act of 1940, as amended, and the rules and regulations thereunder
(collectively called the “Investment Company Act”), as a diversified, closed-end, management investment company; and
WHEREAS, the Fund has filed, or may from time to time file, one or more registration statements on Form N-2 pursuant to the Investment
Company Act and the Securities Act of 1933, as amended, and the rules and regulations thereunder (collectively called the “Securities Act”), to register additional shares of common stock, par value $0.001 per share (“common shares”), of
the Fund, which may be issued and sold from time to time through various specified transactions, including at-the-market (“ATM”) offerings pursuant to Rule 415 under the Securities Act; and
WHEREAS, the Distributor is registered as a broker-dealer under the provisions of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), and is a member in good standing of the Financial Industry Regulatory Authority, Inc. (“FINRA”); and
WHEREAS, the Fund and the Distributor wish to enter into an agreement with each other with respect to ATM offerings, from time to
time, of the Fund’s common shares.
NOW THEREFORE, the parties agree as follows:
Section 1. Appointment of the Distributor; ATM Offerings.
(a) Subject to the terms and conditions of this
Agreement, the Fund hereby appoints the Distributor as its principal underwriter and placement agent for the common shares of the Fund to be offered pursuant to a Registration Statement (as defined below) through ATM offerings from time to time
(the “Shares”) and the Fund agrees that it will issue such Shares as the Distributor may sell. The Distributor agrees to use reasonable efforts to identify opportunities for the sale of Shares, but the Distributor is not obligated to sell
any specific number of the Shares (though the Distributor will only be authorized to sell on any Offering Date (as defined below) the maximum number of Shares agreed to with the Fund pursuant to Section 1(d) hereof) or purchase any Shares for its
own account. The Shares will only be sold on such days as shall be agreed to by the Distributor and the Fund (each, an “Offering Date”). The Distributor hereby accepts such appointment.
(b) The Distributor acknowledges that Shares will be
offered and sold only as set forth from time to time in the Registration Statement including, without limitation, with respect to pricing of Shares, handling of investor funds and payment of sales commissions.
(c) The Fund may suspend or terminate any ATM offering
of its Shares at any time. Upon notice to the Distributor of the terms of such suspension or termination, the Distributor shall suspend the
ATM offering of Shares in accordance with such terms until the Fund notifies the Distributor that such ATM offering may be resumed; provided, however,
that such suspension or termination shall not affect or impair the parties’ respective obligations with respect to the Shares sold hereunder prior to the giving of such notice.
(d) The price per Share shall be determined by the Fund
together with the Distributor by reference to trades on the Fund’s primary exchange. In no event shall the price per Share be less than the then-current net asset value per Share plus the per Share amount of the commission to be paid to the
Distributor (the “Minimum Price”). The Fund may establish a minimum sales price per Share on any Offering Date in excess of the Minimum Price (the “Minimum Sales Price”), and the Fund shall communicate such Minimum Sales Price to the
Distributor. The Fund shall have sole discretion to establish a Minimum Sales Price for any Offering Date and may consider, among other factors, the degree to which the Fund’s market price per Share exceeds its net asset value per Share, and the
amount of assets the Fund desires to raise through ATM offerings. The Distributor shall suspend the sale of Shares if the per share price of the Shares is less than the Minimum Price or the Minimum Sales Price. The Distributor shall, together with
the Fund, determine the maximum number of Shares to be sold by the Distributor for any Offering Date, and the Distributor shall not be authorized to sell Shares on any Offering Date in excess of such maximum.
(e) The Distributor will confirm to the Fund, following
the close of trading on the Fund’s primary exchange on each Offering Date for the Shares, the number of Shares sold, the time of sale, the gross sales price per Share and the compensation payable to the Distributor, or to which the Distributor is
entitled with respect to such sales. The Fund reserves the right to reject any order in whole or in part.
(f) Settlement for sales of the Shares pursuant to this
Section 1 will occur on the second business day following the date on which such sales are made (each such day, a “Settlement Date”). On each Settlement Date, the Shares sold through the Distributor for settlement on such date shall be
delivered by the Fund to the Distributor against payment of the gross sales proceeds for the sale of such Shares, less the Distributor’s sales commission.
(g) In selling Shares, the Distributor shall act solely
as an agent of the Fund and not as principal.
Section 2. Representations and Warranties by the Fund. The Fund represents, warrants to and agrees with the Distributor, as of
the date hereof and as of each Offering Date and Settlement Date, that:
(a) A shelf registration statement on Form N-2 (File No. 333-257996 and 811-22396) (the “Registration Statement”) (i) has been prepared by the Fund in conformity with the requirements of the Securities Act and the Investment Company Act in all material respects, (ii)
has been filed with the U.S. Securities and Exchange Commission (the “Commission”) under the Securities Act and the Investment Company Act; the Registration Statement sets forth the terms of the offering, sale and plan of distribution of
the Shares and contains additional information concerning the Fund and its business, and (iii) heretofore became, and is, effective; no stop order of the Commission preventing or suspending the use of the Prospectus (as defined below), or the
effectiveness of the Registration Statement, has been issued, and no proceedings for such purpose have been instituted or, to the Fund’s knowledge, have been threatened by the Commission. Except where the context otherwise requires, “Registration
Statement,” as used herein, means, collectively, the various parts of the Registration Statement pertaining to the offering and sale of Shares, as amended, at the time of effectiveness for purposes of Section 11 of the Securities Act (the “Effective
Time”), as such section applies to the Distributor, including (1) all
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documents filed as a part thereof or incorporated or deemed to be incorporated by reference therein, (2)
any information contained or incorporated by reference in a prospectus filed with the Commission pursuant to Rule 424 under the Securities Act, to the extent such information is deemed pursuant to Rule 430B or Rule 430C under the Securities Act to
be part of the Registration Statement at the Effective Time, and (3) any registration statement filed to register the offer and sale of Shares pursuant to Rule 462(b) under the Securities Act. Except where the context otherwise requires, “Prospectus,”
as used herein, means a final prospectus, including the related statement of additional information, relating to the Shares, filed by the Fund with the Commission pursuant to Rule 424 under the Securities Act, in the form furnished by the Fund to
the Distributor in connection with the offering of the Shares, together with, if applicable, any final prospectus supplement relating to the Shares attached to or used with such final prospectus, filed by the Fund with the Commission pursuant to
Rule 424 under the Securities Act, in the form furnished by the Fund to the Distributor in connection with the offering of the Shares. Any reference herein to the Registration Statement or the Prospectus shall be deemed to refer to and include the
documents, if any, incorporated by reference, or deemed to be incorporated by reference, therein.
(b) The Fund is duly registered under the Investment
Company Act as a closed-end management investment company. A notification of registration of the Fund as an investment company under the Investment Company Act on Form N-8A (the “Investment Company Act Notification”) has been prepared by the
Fund in conformity with the Investment Company Act and has been filed with the Commission and, at the time of filing thereof and at the time of filing any amendment or supplement thereto, conformed in all material respects with all applicable
provisions of the Investment Company Act. The Fund has not received any notice in writing from the Commission pursuant to Section 8(e) of the Investment Company Act with respect to the Investment Company Act Notification or the Registration
Statement (or any amendment or supplement to either of them). No person is serving or acting as an officer, Director (as defined below) or investment adviser of the Fund except in accordance with the provisions of the Investment Company Act,
provided that for purposes of the foregoing representation with respect to the officers and Directors of the Fund, the Fund shall be entitled to rely on representations from such officers and Directors.
(c) The Registration Statement, the Investment Company Act Notification and the Prospectus as from time to time amended or supplemented each complied when it became effective or was filed (as the case may
be), complies as of the date hereof and, as amended or supplemented, will comply, at each time of purchase of Shares in connection with the ATM offerings, and at all times during which a prospectus is required by the Securities Act to be delivered
in connection with any sale of Shares, in all material respects, with the requirements of the Securities Act and the Investment Company Act; the Registration Statement did not, as of the Effective Time, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; at no time during the period that begins on the earlier of the date of the Prospectus and the date the Prospectus was
filed with the Commission and ends at the later of the time of purchase of Shares in connection with the ATM offerings, and the end of the period during which a prospectus is required by the Securities Act to be delivered in connection with any
sale of Shares did or will the Prospectus, as from time to time amended or supplemented, include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however, that the Fund does not make any representation or warranty with respect to any statement contained in the Registration Statement or the Prospectus in
reliance upon and in conformity with information furnished by the Distributor or any sub-placement agents (as defined below), or on the Distributor’s or any sub-placement agent’s behalf, to the Fund or its officers, Directors or counsel for use in
the Registration Statement or the Prospectus (the “Agent Provided Information”).
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(d) The financial statements incorporated by reference
in the Registration Statement or the Prospectus, together with the related notes and schedules, present fairly the financial position of the Fund as of the dates indicated and the results of operations, cash flows and changes in stockholders’
equity of the Fund for the periods specified and have been prepared in compliance in all material respects with the requirements of the Securities Act, the Investment Company Act and the Exchange Act, and in conformity in all material respects with
U.S. generally accepted accounting principles applied on a consistent basis during the periods involved; there are no financial statements that are required to be included or incorporated by reference in the Registration Statement or the Prospectus
by the Securities Act, the Investment Company Act or the Exchange Act that are not included or incorporated by reference as required; and the Fund does not have any material liabilities or obligations, direct or contingent (including any
off-balance sheet obligations), not described in the Registration Statement (excluding the exhibits thereto).
(e) As of the date of this Agreement, the Fund has an
authorized capitalization as set forth in the Registration Statement and the Prospectus and, with respect to any issuance and sale under this Agreement, the Fund shall have as of the date of the most recent amendment or supplement to the
Registration Statement or Prospectus, an authorized capitalization as set forth in the Registration Statement and the Prospectus; all of the issued and outstanding shares of capital stock, including the Shares, of the Fund have been duly authorized
and validly issued and are fully paid and non-assessable (except as described below and in the Registration Statement), have been issued in material compliance with all applicable securities laws and were not issued in violation of any preemptive
right, resale right, right of first refusal or similar right; the Shares will be duly listed, and admitted and authorized for trading, subject to official notice of issuance, on the exchange on which the Fund’s Shares are listed and primarily trade
(the “Stock Exchange”).
(f) The Fund has been incorporated, is validly existing and is in good standing under the laws of Maryland, with full power and authority to own, lease and operate and conduct its business as described in
the Registration Statement and the Prospectus and to issue, sell and deliver the Shares as contemplated herein. The Fund is duly qualified to do business as a foreign entity and is in good standing in each jurisdiction where the conduct of its
business requires such qualification, except where the failure to be so qualified and in good standing would not, individually or in the aggregate, have a material adverse effect on the business, properties, financial condition or results of
operations of the Fund.
(g) The Shares have been duly and validly authorized
and, when issued and delivered against payment therefor as provided herein, will be duly and validly issued, fully paid and non-assessable (except as described below and in the Registration Statement) and free of statutory and contractual
preemptive rights, resale rights, rights of first refusal and similar rights; the Shares, when issued and delivered against payment therefor as provided herein, will be free of any restriction upon the voting or transfer thereof pursuant to the
Fund’s Articles of Incorporation, as amended or supplemented, the Fund’s Bylaws, as amended or supplemented, or any agreement or other instrument to which the Fund is a party (except as described in the Registration Statement). The capital stock of
the Fund, including the Shares, conforms in all material respects to each description thereof, if any, contained or incorporated by reference in the Registration Statement or the Prospectus; and the certificates for the Shares, if any, are in due
and proper form. The Fund is in material compliance with the rules of the Stock Exchange, including, without limitation, the requirements for continued listing of the Shares on the Stock Exchange and the Fund has not received any written notice
from the Stock Exchange regarding the delisting of the Shares from the Stock Exchange.
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(h) No approval, authorization, consent or order of or filing with any federal, state, local or foreign governmental or regulatory commission, board, body, authority or agency, or of or with any
self-regulatory organization or other non-governmental regulatory authority (including, without limitation, the Stock Exchange), or approval of the stockholders of the Fund that has not already been obtained, is required in connection with the
issuance and sale of the Shares or the consummation by the Fund of the transactions contemplated hereby, other than (i) the registration of the Shares under the Securities Act, which has been effected, (ii) the listing of the Shares with the Stock
Exchange, upon official notice of issuance, (iii) any necessary qualification under the securities or blue sky laws of the various jurisdictions in which the Shares are being offered by the Fund or (iv) any necessary qualification pursuant to the
rules of FINRA.
Section 3. Duties of the Fund.
(a) The Fund shall take, from time to time, but subject
always to any necessary approval of the Board of Directors of the Fund (each Board member a “Director,” and together the “Board”) or of its stockholders, all necessary action to fix the number of authorized Shares, to the end that the
Fund will have a number of authorized but unissued Shares at least equal to the number of Shares registered for sale under the Securities Act and available for sale pursuant to the Registration Statement.
(b) For purposes of the ATM offerings of Shares, the
Fund will furnish to the Distributor copies of its most recent amendment to its Registration Statement for a particular ATM offering, its most recent Prospectus and all amendments and supplements thereto, and other documentation the Distributor may
reasonably request for use in the ATM offerings of Shares. The Distributor is authorized to furnish to prospective investors only such information concerning the Fund and the ATM offerings of Shares as may be contained in the Registration
Statement, the Prospectus, the Fund’s publicly available formation documents, or any other documents (including sales material), if expressly approved by the Fund for such purpose.
(c) The Fund shall furnish to the Distributor copies of
all financial statements of the Fund which the Distributor may reasonably request for use in connection with its duties hereunder, and this shall include, upon request by the Distributor, one copy of all financial statements prepared for the Fund
by independent public accountants.
(d) The Fund shall use its best efforts to qualify and
maintain, to the extent required by applicable law, the qualification of Shares for sale under the securities laws of such jurisdictions as the Distributor and the Fund may approve. Any such qualification may be withheld, terminated or withdrawn by
the Fund at any time in its discretion. The expense of qualification and maintenance of qualification shall be borne by the Fund. The Distributor shall furnish such information and other material relating to its affairs and activities as may be
required by the Fund in connection with such qualification.
(e) The Fund will furnish, in reasonable quantities
upon request by the Distributor, copies of its annual and interim reports.
(f) The Fund will furnish the Distributor with such
other documents as it may reasonably require, from time to time, for the purpose of enabling it to perform its duties as contemplated by this Agreement.
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Section 4. Duties of the Distributor.
(a) The Distributor shall devote reasonable time and
effort to its duties hereunder. The services of the Distributor to the Fund hereunder are not to be deemed exclusive and nothing herein contained shall prevent the Distributor from entering into like arrangements with other investment companies so
long as the performance of its obligations with respect to the Fund hereunder is not impaired thereby.
(b) In performing its duties hereunder, the Distributor
shall comply with the requirements of all applicable laws relating to the sale of securities in all material respects. Neither the Distributor nor any sub-placement agent having an agreement to offer and sell Shares pursuant to Section 5 hereof nor
any other person is authorized by the Fund to give any information or to make any representations, other than those contained in its Registration Statement, Prospectus and any sales literature specifically approved in writing for such use by the
Fund.
(c) The Distributor shall adopt and follow appropriate
procedures for the confirmation of sales to selected dealers, the collection of amounts payable by selected dealers on such sales, and the cancellation of unsettled transactions, as may be necessary to comply with the requirements of FINRA
applicable to sales of Shares, as such requirements may from time to time exist.
(d) The Distributor shall prepare or review, and file
with federal and state agencies or other organizations as required by federal, state, or other applicable laws and regulations, all sales literature (advertisements, brochures and stockholder communications) prepared in connection with the ATM
offerings for the Fund.
(e) The Distributor agrees to supply the following
additional services, together with such other services as set forth throughout this Agreement:
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1.
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handling inquiries from sub-placement agents regarding the Fund;
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2.
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assisting in the enhancement of communications between sub-placement agents and the Fund;
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3.
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communicating the Minimum Price or Minimum Sales Price to any sub-placement agents and instructing any sub-placement agents not to sell Shares if such sales cannot be
effected at or above the Minimum Price or the Minimum Sales Price;
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4.
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communicating the maximum amount of Shares to be sold on any Offering Date to any sub-placement agents;
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5.
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notifying any sub-placement agents of any suspension or termination of the ATM offerings of Shares, together with any corresponding resumption of the ATM offerings of
Shares;
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6.
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coordinating delivery of any Shares sold through sub-placement agents to such sub-placement agents on the Settlement Date against payment of the gross sales proceeds
for the sale of such Shares, less any applicable sub-placement agent selling commission;
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7.
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delivering the Fund’s Prospectus to any sub-placement agents;
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8.
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identifying potential sub-placement agents;
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9.
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monitoring the performance of sub-placement agents;
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10.
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providing any necessary reconciliation, accounting and recordkeeping services in respect of the ATM offerings of Shares, including with respect to the underwriting
compensation paid by the Fund to the
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11.
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providing such other information, assistance and services as may be reasonably requested by the Fund.
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(f) The Distributor shall report to the Board at least
quarterly, or more frequently as requested by the Board, regarding: (i) the nature of the services provided by the Distributor hereunder; (ii) the amount of compensation sub-placement agents, if any, are entitled to retain or be paid by the
Distributor; and (iii) the aggregate amount of underwriting compensation paid by the Fund to the Distributor in respect of the ATM offerings of Shares.
(g) The Distributor represents and warrants to the Fund
that it has all necessary licenses to perform the services contemplated hereunder and will perform such services in compliance with all applicable rules and regulations.
(h) The Distributor shall make such initial and ongoing
inquiry with respect to any sub-placement agents as shall be necessary to obtain appropriate assurances, reasonably satisfactory to the Fund, from any such sub-placement agents with respect to the respective sub-placement agents’ licensing,
performance of services in respect of the Fund, compliance programs and such other matters as may be customary, necessary or desirable in respect of such sub-placement agents’ participation in the ATM offerings of Shares, or as may be requested by
the Fund.
Section 5. Agreements with Sub-Placement Agents.
(a) The Distributor may enter into selected dealer
agreements, on such terms and conditions as the Distributor determines are not inconsistent with this Agreement, with broker-dealers to act as the Distributor’s agents to effect the sale of the Shares in the ATM offerings. Such selected
broker-dealers (“sub-placement agents”) shall sell Shares only at market prices subject to the Minimum Price and the Minimum Sales Price. This Agreement shall not be construed as authorizing any dealer or other person to accept orders for
sale on the Fund’s behalf or to otherwise act as the Fund’s agent for any purpose. The Distributor shall not be responsible for the acts of other dealers or agents except as and to the extent that they shall be acting for the Distributor or under
the Distributor’s direction or authority.
(b) The Distributor shall offer and sell Shares only to
such sub-placement agents who are acting as brokers or dealers who are members in good standing of FINRA and who agree to abide by the rules of FINRA.
(c) The Distributor shall obtain appropriate assurance
from any sub-placement agents which it engages of the compliance by such sub-placement agents with applicable federal and state securities laws and the rules of FINRA.
Section 6. Sales Commission.
(a) The Fund shall pay the Distributor, or the
Distributor shall be entitled to retain, an amount equal to 1.00% of the gross sales price per Share of the Shares sold.
(b) The Distributor may pay to sub-placement agents
such sub-placement agent commissions as the Distributor shall deem advisable, or may authorize such sub-placement agents to retain such sub-placement agent commissions from the gross sales proceeds from the sale of such Shares, which shall be
payable or retained, as the case may be, from the commissions payable or retained, as the case may be, to or by the Distributor under Section 6(a) above.
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(c) The Fund hereby represents and warrants to the
Distributor that (i) the terms of this Agreement, (ii) the fees and expenses associated with this Agreement, and (iii) any benefits accruing to the Distributor or to the Fund’s investment adviser or sponsor or another affiliate of the Fund in
connection with this Agreement, including but not limited to any fee waivers, conversion cost reimbursements, up-front payments, signing payments or periodic payments relating to this Agreement have been fully disclosed to the Board or a designated
Committee thereof and that, if required by applicable law, the Board or a designated Committee thereof has approved or will approve the terms of this Agreement, any such fees and expenses, and any such benefits.
Section 7. Payment of Expenses.
(a) The Fund shall bear all of its own costs and
expenses, including fees and disbursements of its counsel and auditors, in connection with the preparation of its Prospectus, Statement of Additional Information, if any, the preparation and filing of any required registration statements under the
Securities Act and/or the Investment Company Act, and all amendments and supplements thereto, and in connection with any fees and expenses incurred with respect to any filing requirements of FINRA and preparing and mailing annual and interim
reports and proxy materials to stockholders (including but not limited to the expense of setting in type any such Registration Statement, Prospectus, interim reports or proxy materials).
(b) The Fund shall bear any cost and expenses of
qualification of the Shares for sale pursuant to this Agreement.
(c) The Distributor shall bear all expenses incurred by
it in connection with its duties and activities under this Agreement, including the compensation of sub-placement agents for sales of the Fund’s Shares and fees and expenses of Distributor’s counsel (except for any FINRA filing fees or “blue sky”
fees paid on behalf of the Fund or the Distributor by such counsel).
Section 8. Limitation of Liability; Indemnification.
(a) The Distributor shall not be liable for any error
of judgment or mistake of law or for any loss suffered by the Fund in connection with the matters to which this Agreement relates, except a loss resulting from willful misfeasance, bad faith or gross negligence on its part in the performance of its
duties or from reckless disregard by it of its obligations and duties under this Agreement. The Distributor shall not be liable for any damages arising out of any action or omission to act by any prior service provider of the Fund or for any
failure to discover any such error or omission (provided that this sentence shall not apply where the Distributor was the prior service provider). Notwithstanding anything in this Agreement to the contrary, the Distributor shall not be liable for
any consequential, incidental, exemplary, punitive, special or indirect damages, whether or not the likelihood of such damages was known by the Distributor. Notwithstanding anything in this Agreement to the contrary, the Distributor shall not be
liable for damages occurring directly or indirectly by reason of circumstances beyond its reasonable control.
(b) The Fund agrees that it will indemnify, defend and hold harmless the Distributor, its several officers, and directors, and any person who controls the Distributor within the meaning of Section 15 of the
Securities Act, from and against any losses, claims, damages or liabilities, joint or several, to which the Distributor, its several officers, and directors, and any person who controls the Distributor within the meaning of Section 15 of the
Securities Act, may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions or
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proceedings in respect thereof) (i) arise out of, or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement, the Prospectus or in any application or other document executed by or on behalf of the Fund or are based upon information furnished by or on behalf of the Fund filed in
any state in order to qualify the Shares under the securities or blue sky laws thereof (“Blue Sky application”) or arise out of, or are based upon, the omission or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading; or (ii) arise out of, or are based upon, any breach of the representations, warranties or covenants of the Fund contained in this Agreement, and the Fund will reimburse the
Distributor, its several officers, and directors, and any person who controls the Distributor within the meaning of Section 15 of the Securities Act, for any documented, reasonable legal or other expenses reasonably incurred by the Distributor, its
several officers, and directors, and any person who controls the Distributor within the meaning of Section 15 of the Securities Act, in investigating, defending or preparing to defend any such action, proceeding or claim described above in this
Section 8(b); provided, however, that the Fund shall not be liable in any case to the extent that such loss, claim, damage or liability arises out of, or is based upon, any untrue statement, alleged untrue statement, or omission or
alleged omission made in the Registration Statement, the Prospectus or any Blue Sky application with respect to the Fund in reliance upon and in conformity with any Agent Provided Information, or arising out of the failure of the Distributor or any
sub-placement agent to deliver a current Prospectus or to conduct its business in compliance in all material respects with this Agreement and with regulations applicable to it. Notwithstanding anything in this Agreement to the contrary, the Fund
shall not be liable for any consequential, incidental, exemplary, punitive, special or indirect damages, whether or not the likelihood of such damages was known by the Fund. Notwithstanding anything in this Agreement to the contrary, the Fund shall
not be liable for damages occurring directly or indirectly by reason of circumstances beyond its reasonable control.
(c) The Fund shall not indemnify any person pursuant to
this Section 8 unless the court or other body before which the proceeding was brought has rendered a final decision on the merits that such person was not liable by reason of his or her willful misfeasance, bad faith or gross negligence in the
performance of his or her duties, or his or her reckless disregard of any obligations and duties, under this Agreement (“disabling conduct”) or, in the absence of such a decision, a reasonable determination (based upon a review of the facts)
that such person was not liable by reason of disabling conduct has been made by the vote of a majority of a quorum of the Directors of the Fund who are neither “interested parties” (as defined in the Investment Company Act) nor parties to
the proceeding, or by independent legal counsel in a written opinion.
(d) The Distributor will indemnify and hold harmless
the Fund and its several officers and Directors, and any person who controls the Fund within the meaning of Section 15 of the Securities Act, from and against any losses, claims, damages or liabilities, joint or several, to which any of them may
become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions 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 the Registration Statement, the Prospectus or any Blue Sky application, or arise out of, or are based upon, the omission or alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, which statement or omission was made in reliance upon and in conformity with information furnished to the Fund or any of its several officers and Directors or counsel by or on behalf of the Distributor
specifically for inclusion therein, and will reimburse the Fund and its several officers, Directors and such controlling persons for any documented, reasonable legal or other expenses reasonably incurred by any of them in investigating, defending
or preparing to defend any such action, proceeding or claim.
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(e) This Section 8 shall survive any termination of
this Agreement.
Section 9. Duration and Termination of this Agreement.
(a) This Agreement shall become effective as of the
date first above written and shall remain in force thereafter subject to compliance with any requirements under the Investment Company Act.
(b) This Agreement may be terminated at any time,
without the payment of any penalty, by the Directors or by vote of a majority of the outstanding voting securities of the Fund, or by the Distributor, on sixty days’ written notice to the other party.
(c) The terms “vote of a majority of the outstanding
voting securities,” and “interested person,” when used in this Agreement, shall have the respective meanings specified in the Investment Company Act.
Section 10. Amendments of this Agreement. This Agreement may be amended by the parties only if such amendment is specifically
approved, to the extent required by law, (i) by the Directors or by the vote of a majority of the outstanding voting securities of the Fund and (ii) by the vote of a majority of those Directors of the Fund who are not parties to this Agreement or
interested persons of any such party cast in person at a meeting called for the purpose of voting on such approval.
Section 11. Governing Law. This Agreement and any claim, counterclaim or dispute of any kind or nature whatsoever arising out
of or in any way relating to this Agreement, directly or indirectly, shall be governed by, and construed in accordance with, the internal laws of the State of New York. To the extent that the applicable law of the State of New York, or any of the
provisions herein, conflict with the applicable provisions of the Investment Company Act, the latter shall control.
Section 12. Customer Identification Program Notice. To help the U.S. government fight the funding of terrorism and money
laundering activities, U.S. federal law requires each financial institution to obtain, verify, and record certain information that identifies each person who initially opens an account with that financial institution on or after October 1, 2003.
Consistent with this requirement, the Distributor will request (or already has requested) the Fund’s name, address and taxpayer identification number or other government-issued identification number. The Distributor may also ask (and may have already
asked) for additional identifying information, and the Distributor may take steps (and may have already taken steps) to verify the authenticity and accuracy of these data elements.
Section 13. Miscellaneous. The captions in this Agreement are included for convenience of reference only and in no way define
or delimit any of the provisions hereof or otherwise affect their construction or effect. If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors.
Section 14. Proprietary and Confidential Information. The Distributor agrees on behalf of itself and its employees to treat
confidentially and as proprietary information of the Fund all records and other
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information relative to the Fund and prior, present or potential stockholders, and not to use such records and information for any purpose other than
performance of its responsibilities and duties hereunder, except after prior notification to and approval in writing by the Fund, which approval shall not be unreasonably withheld and shall not be required where the Distributor may be exposed to
civil or criminal contempt proceedings for failure to comply, when requested to divulge such information by duly constituted authorities, or when so requested by the Fund. The provisions of this Section 14 shall survive termination of this Agreement.
Notwithstanding anything in this Agreement to the contrary, each party hereto agrees that: (i) any Nonpublic Personal Information, as
defined under Section 248.3(t) of Regulation S-P (“Regulation S-P”), promulgated under the Xxxxx-Xxxxx-Xxxxxx Act (the “Act”), disclosed by a party hereunder is for the specific purpose of permitting the other party to perform the
services set forth in this Agreement, and (ii) with respect to such information, each party will comply with Regulation S-P and the Act and will not disclose any Nonpublic Personal Information received in connection with this Agreement to any other
party, except to the extent as necessary to carry out the services set forth in this Agreement or as otherwise permitted by Regulation S-P or the Act.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. This
Agreement may be executed by the parties hereto in any number of counterparts, all of which shall constitute one and the same instrument.
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XXXXXXXXX XXXXXX HIGH YIELD STRATEGIES FUND INC.
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By:
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Name:
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[______]
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Title:
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[______]
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XXXXXXXXX BERMAN BD LLC
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By:
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||||
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Name:
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[______]
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|||
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Title:
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{______]
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Signature Page to Xxxxxxxxx Xxxxxx High Yield Strategies Fund Inc. Distribution Agreement
