EXHIBIT - 6a
DECLARATION FUND
AGREEMENT PURSUANT
TO PLAN OF DISTRIBUTION
AGREEMENT made this 22nd day of April, 1992, by and between DECLARATION
FUND, a Pennsylvania business trust, (the "Trust"), and DECLARATION
DISTRIBUTORS, INC., a Pennsylvania corporation (the "Distributor").
W I T N E S S E T H:
WHEREAS, the Trust is engaged in business as an open-end management
investment company and is registered as such under the Investment Company Act of
1940, as amended (the "Investment Company Act"); and
WHEREAS, the Trust is authorized to issue units of interest (the "Shares"),
in separately designated series representing separate funds with their own
investment objectives, policies and purposes (the "Funds") and has registered
the Shares of the Funds under the Securities Act of 1933, as amended (the
"Securities Act"), pursuant to a registration statement on Form N-1A (the
"Registration Statement"), including a prospectus (the "Prospectus") and a
statement of additional information (the "Statement of Additional Information");
and
WHEREAS, the Trust has adopted a Plan of Distribution pursuant to Rule
12b-1 under the Investment Company Act on behalf of each Fund (the "Distribution
Plans") and may enter into related agreements providing for the distribution of
the Shares of the Funds; and
WHEREAS, the Distributor is registered as a broker-dealer under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"); and
WHEREAS, the Trust wishes to engage the services of the Distributor as
distributor of the Shares of the Funds and the Distributor is willing to serve
in that capacity;
NOW, THEREFORE, it is hereby agreed between the parties hereto as follows:
1. Appointment of Distributor.
(a) The Trust hereby appoints the Distributor as distributor of the
Trust to distribute the Shares of the Funds in jurisdictions wherein the
Shares may be legally offered for sale. The Distributor shall be the
exclusive agent for the distribution of Shares of the Funds; provided,
however, that the Trust in its absolute discretion may issue Shares of the
Funds otherwise than through the Distributor in connection with (i) the
payment or reinvestment of dividends or distributions, (ii) any merger or
consolidation of the Trust or a Fund with any other investment company or
trust or any personal holding company, or the acquisition of the assets of
any such entity or another series of the Trust, or (iii) any offer of
exchange authorized by the Board of Trustees of the Trust. Notwithstanding
any other provision hereof, the Trust may terminate, suspend or withdraw
the offering of Shares of a Fund whenever, in its sole discretion, it deems
such action to be desirable.
(b) The Distributor hereby accepts such appointment as distributor of
the Shares of the Trust and agrees that it will use its best efforts to
promote the Funds and to solicit orders for the purchase of Shares. The
Distributor
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may arrange for the sale of Shares of the Funds to or through qualified dealers
or others and shall require each such dealer to conform to the provisions
hereof, the Registration Statement, the Prospectus and Statement of Additional
Information, and applicable law. Neither the Distributor nor any such dealer
shall withhold the placing of purchase orders for Shares so as to make a profit
thereby.
(c) The Distributor shall order Shares of the Funds from the Trust
only to the extent that it shall have received purchase orders therefor.
The Distributor will not make or authorize any dealers or others to make
(i) any short sales of Shares, or (ii) any sales of Shares to any director
or officer of the Trust, the Distributor or any corporation or association
furnishing investment advisory, managerial or supervisory services to the
Trust, or to any such corporation or association, unless such sales are
made in accordance with the then current Prospectus and Statement of
Additional Information.
(d) The Distributor is not authorized by the Trust to give any
information or to make any representation other than those contained in the
current Prospectus, Statement of Additional Information and shareholder
reports, or in supplementary sales materials specifically approved by the
Trust.
2. Offering Price of Shares. All Fund shares sold under this Agreement
shall be sold at the public offering price per Share in effect at the time of
the sale as described in the then current Prospectus and Statement of Additional
Information. At no time shall the Trust receive less than the full net asset
value of the Shares, determined in the manner set forth in the then current
Prospectus and
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Statement of Additional Information.
3. Distribution Plan Payments.
(a) The Distributor shall be entitled to reimbursement of its expenses
in paying commissions and account maintenance fees to qualified dealers in
respect of Fund shares sold by such dealers. Such payments to the
Distributor shall be made by the Funds pursuant to the terms of the
Distribution Plans in reimbursement of amounts paid by the Distributor in
the form of commissions and account maintenance fees.
(b) The Distributor shall prepare and deliver reports to the Board of
Trustees of the Trust on a regular basis, at least quarterly, showing the
Distributor's expenses incurred in paying commissions and account
maintenance fees to qualified dealers and the payments made by the Funds to
the Distributor pursuant to the Distribution Plans, and other amounts
expended by the Distributor in connection with its activities hereunder and
the purposes for which such expenditures were made, as well as any
supplemental reports as the Board of Trustees of the Trust may, from time
to time, reasonably request.
4. Payment of Expenses.
(a) The Distributor shall be reimbursed for its distribution expenses
incurred, for among other things, the following: (i) payments to qualified
broker-dealers and others in respect of the sale of Shares of the Funds and
account maintenance fees; (ii) compensation and expenses of employees of
the Distributor who engage in or support distribution of Fund Shares or
render shareholder support
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services not otherwise provided by the Trust's transfer and shareholder
servicing agent; (iii) formulation and implementation of marketing and
promotional activities; (iv) preparation, printing and distribution of
supplementary sales materials and the printing and distribution of
Prospectuses, Statements of Additional Information and shareholder reports
for recipients other than existing shareholders of the Funds' and (v)
obtaining such information, analyses and reports with respect to marketing
and promotional activities as the Trust may, from time to time, reasonably
request.
(b) The Trust shall pay the following expenses: (i) preparation,
printing and distribution to Fund shareholders of Prospectuses and
Statements of Additional Information; (ii) preparation, printing and
distribution of shareholder reports and other communications to
shareholders; (iii) registration of the Shares of the Funds under the
federal securities laws; (iv) qualification of the Shares of the Funds for
sale in such states as the Distributor and the Trust may approve; (v)
qualification of the Trust as a dealer or broker under state law as well as
qualification of the Trust as an entity authorized to do business in
certain states where necessary; (vi) maintaining facilities for the issue
and transfer of Shares; (vii) supplying information, prices and other data
to be furnished by the Trust under this Agreement; and (viii) taxes
applicable to the sale or delivery of the Shares of the Funds or
certificates therefor.
5. Furnishing of Information. The Trust shall furnish to the Distributor
for use in connection with the sale of Shares of the Funds such information,
financial statements and other documents as the Distributor may reasonably
request. The Trust shall also make available such number of copies of the
current Prospectus,
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Statement of Additional Information and shareholder reports as the Distributor
shall reasonably request.
6. Indemnification.
(a) The Trust agrees to indemnify and hold harmless the Distributor
against any losses, claims, damages or liabilities to which the Distributor
may become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement or any
amendment thereto or the Prospectus (other than an omitting
prospectus prepared pursuant to Rule 482 under the securities Act
unless such omitting prospectus has been specifically approved by
the Trust) or the Statement of Additional Information or any
amendment or supplement thereto or an annual or interim report to
shareholders; or
(ii) the omission or alleged omission to state in the
Registration Statement or any amendment thereto or the Prospectus
(other than an omitting prospectus prepared pursuant to Rule 482
under the Securities Act unless such omitting prospectus has been
specifically approved by the Trust) or the Statement of
Additional Information or any
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amendment or supplement thereto or an annual or interim report to
shareholders, a material fact required to be stated therein or
necessary to make the statements therein not misleading;
and will reimburse, as incurred, the Distributor for any legal or other expenses
reasonably incurred by the Distributor in connection with investigating,
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action; provided, however, that the Trust
will not be liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in the
Registration Statement or any amendment thereto, or the Prospectus or Statement
of Additional Information or any amendment or supplement thereto or in an annual
or interim report to shareholders, in reliance upon and in conformity with
written information furnished to the Trust by the Distributor specifically for
use therein; and provided, further, that this indemnity agreement shall not
protect the Distributor or any such controlling person against any liability to
which it would otherwise be subject by reason of misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of its reckless
disregard of its obligations and duties hereunder. This indemnity agreement will
be in addition to any liability which the Trust may otherwise have.
(b) The Distributor shall indemnify and hold harmless the Trust, each
of the Trust's Trustees and each of the Trust's officers who signed the
Registration
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Statement against any losses, claims, damages or liabilities to which the
Trust or any such trustee or officer may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement or any
amendment thereto or the Prospectus or Statement of Additional
Information or any amendment or supplement thereto, or the
omission or alleged omission to state in the Registration
Statement or any amendment thereto, or the Prospectus or
Statement of Additional information or any amendment or
supplement thereto, a material fact required to be stated therein
or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written
information furnished to the Trust by the Distributor
specifically for use therein; or
(ii) any untrue statement or alleged untrue statement of a
material fact contained in any unauthorized supplementary sales
materials or omitting prospectus prepared pursuant to
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Rule 482 under the Securities Act, or the omission or alleged
omission to state in any such materials or prospectus, a material
fact required to be stated therein or necessary to make the
statements therein not misleading; or (iii) any act or deed of
the Distributor or its representatives which has not been
authorized by the Trust in any Prospectus or Statement of
Additional Information or by this Agreement;
and will reimburse, as incurred, any legal or other expenses reasonably
incurred by the Trust or any such Trustee, or officer in connection with
investigating, defending against or appearing as a third-party witness in
connection with any such loss, claim, damage, liability or action;
provided, however, that this indemnity agreement shall not protect any
director or officer of the Trust against any liability to which he or she
would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the dutied involved in the
conduct of his or her office. This indemnity agreement will be in addition
to any liability which the distributor may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section
6 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under this Section 6, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not
relieve it from any liability which it may have
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to any indemnified party otherwise than under this Section 6. In case any
such action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein and, to the extent that it may wish, to
assume the defense thereof, with counsel satisfactory to such indemnified
party; provided, however, that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified
party shall have reasonably concluded that there may be one or more legal
defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party,
the indemnifying party shall not have the right to direct the defense of
such action on behalf of such indemnified party, the indemnifying party
shall not have the right to direct the defense of such action on behalf of
such indemnified party or parties and such indemnified party or parties
shall have the right to select separate counsel to defend such action on
behalf of such indemnified party or parties. After notice from the
indemnifying party to such indemnified party of its election so to assume
the defense thereof and approval by such indemnified party of counsel
appointed to defend such action, the indemnifying party will not be liable
to such indemnified party under this Section 6 for any legal or other
expense, other than reasonable costs of investigation, subsequently
incurred by such indemnified party in connection with the defense thereof,
unless (i) the indemnified party shall have employed separate counsel in
accordance with the proviso to the next preceding sentence or (ii) the
indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party. After such
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notice from the indemnifying party to such indemnified party, the
indemnifying party will not be liable for the costs and expenses of any
settlement of such action effected by such indemnified party without the
consent of the indemnifying party, unless such indemnifying party waived
its rights under this Section 6 in which case the indemnified party may
effect such a settlement without such consent.
7. Term and Termination.
(a) This Agreement shall become effect as of the date hereof. Unless
sooner terminated as herein provided, this Agreement shall remain in full
force and effect until April 22, 1993, and thereafter may be continued for
successive periods of one year, but only so long as each such continuance
is specifically approved at least annually (i) by the Board of Trustees of
the Trust, and (ii) by vote of a majority of the Trustees of the Trust who
are not interested persons of the Trust and who have no direct or indirect
financial interest in the operation of the Distribution Plans or in this
Agreement or any other agreement related to the Distribution Plans (the
"12b-1 Trustees"), cast in person at a meeting called for the purpose of
voting on such approval.
(b) This Agreement may be terminated at any time, without the payment
of any penalty, by the Board of Trustees of the Trust including a majority
of the 12b-I Trustees, by vote of a majority of the outstanding voting
securities of the Trust, or by the distributor, on not more than 60 days'
nor less than 30 days' written notice to the other party or upon such
shorter notice as may be mutually agreed upon.
(c) This Agreement shall automatically terminate in the event of
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its assignment.
(d) The reimbursement and indemnification provisions contained in
Section 6 of this Agreement shall remain in full force and effect
regardless of any termination of this Agreement.
9. Definition of Certain Terms. For purposes of this Agreement the terms,
"assignment", "interested person", "majority of the outstanding voting
securities" and "principal underwriter" shall have their respective meanings
defined in the Investment Company Act and the rules and regulations thereunder,
subject, however, to such exemptions as may be granted to either the Distributor
or the Trust by the Securities and Exchange Commission, or such interpretative
positions as may be taken by the Commission or its Staff under the Investment
Company Act.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed as of the day and year first above written.
DECLARATION FUND
ATTEST:
/s/ Xxxxxx X. Xxxxxx BY: /s/ Xxxxxxx X. Xxxxx
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DECLARATION DISTRIBUTORS, INC.
ATTEST:
/s/ Xxxxxx X. Xxxxxx BY: /s/ Xxxxxxx X. Xxxxx
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