Exhibit No. 5
DISTRIBUTION AGREEMENT
Agreement, made as of the 1st day of December, 1998 between Xxxxxxxx-Xxxxx
Government Fund, a Maryland corporation (the "Company"), and Provident
Distributors, Inc., a Delaware corporation ("Distributor").
WHEREAS, the Company is an open-end, diversified management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Company desires to appoint Distributor as its distributor to
provide for the sale and distribution of the shares of Common stock, $0.01 par
value, of the Company ("Common Stock"), and Distributor is willing to render
such services;
NOW, THEREFORE, this Agreement
WITNESSETH:
that for and in consideration of the premises and the covenants contained herein
and for other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties agree as follows:
1. Except as otherwise provided herein, the Company hereby appoints the
Distributor as its exclusive agent to sell and distribute shares of
Common Stock of the Company at the net asset value thereof as described
and set forth in the current prospectus of the Company, and Distributor
accepts such appointment and agrees to render the services and perform
the duties set forth in this Agreement without further compensation.
The Distributor may make sales of the shares of Common Stock of the
Company directly to the public or to or through dealers. The
compensation of any such dealers shall be the responsibility of
Distributor.
2. Notwithstanding the foregoing appointment, the Company may distribute
its shares.
3. In performing its duties as Distributor, Distributor will act in
conformity with the Articles of Incorporation, By-Laws and prospectus
for the Company and with the instructions and directions of the
Company's Board of Directors and the requirements of the Securities Act
of 1933, the 1940 Act and all other applicable Federal and State laws
and regulations.
4. After effectiveness of the Company's Registration Statement,
Distributor will hold itself available to receive by mail, telex and/or
telephone, orders for the purchase
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of Common Stock and will accept or reject such orders on behalf of the
Company in accordance with the provisions of the prospectus, and will
transmit such orders as are so accepted to the Company's transfer
agent as promptly as possible.
5. Distributor shall not be obligated to sell any certain number of
shares of the Company's Common Stock.
6. The sale of the Company's shares may be suspended with or without
prior notice whenever in the judgment of the Company it is in its best
interest to do so.
7. Neither the Distributor nor any other person is authorized by the
Company to give any information or to make any representation relative
to the Company's shares other than those contained in the Registration
Statement or prospectus filed with the Securities and Exchange
Commission as the same may be amended from time to time or in any
supplemental information to said prospectus approved by the Company.
The Distributor agrees that any other information or representation
other than those specified above which it or any dealer or other
person who purchases shares through the Distributor may make in
connection with the offer or sale of shares, shall be made entirely
without liability on the part of the Company. No person or dealer
other than the Distributor shall be deemed to be authorized hereby to
act as agent for the Company for any purpose. The Distributor agrees
that in offering or selling shares as agent for the Company it will in
all respects duly conform to all applicable State and Federal laws and
the rules and regulations of the National Association of Securities
Dealers, Inc. including its
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Code of Conduct. The Distributor will submit to the Company copies of all
sales literature before using the same and will not use literature if
disapproved by the Company.
8. Subsequent to the effectiveness of the Company's initial registration
statement under the Securities Act of 0000, X.X.X. Xxxxxxxx, X.X. Xxxxx,
Inc. will bear the cost of all sales and promotional expenses, including
the expenses of printing all sales literature and prospectuses, other than
those utilized for regulatory purposes and those furnished from time to
time to existing shareholders of the Company.
9. This Agreement shall continue in effect for two years from the date of its
execution and thereafter for successive periods of one year each if such
continuance is approved at least annually by the Board of Directors of the
Company including a majority of the Directors of the Company who are not
"interested persons" cast in person at a meeting called for that purpose.
The term "interested persons" shall be construed in accordance with its
definition in section 2(a)(19) of the 1940 Act. This Agreement may be
terminated upon 60 days written notice by the Company and/or the
Distributor.
10. This Agreement may not be assigned by the Distributor and shall
automatically terminate in the event of an assignment as defined in the
1940 Act; provided, however, that the Distributor may employ such other
person, persons, corporation
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or corporations as it shall determine, in order to assist it in carrying
out this Agreement.
11. Distributor shall not be liable for any error of judgment or mistake of law
or for any loss suffered by the Company 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 the Agreement. Any person, even though also an officer,
employee or agent of Distributor, who may be or become an officer,
director, employee or agent of the Company shall be deemed, when rendering
services to the Company or acting in any business of the Company, to be
rendering such services to or acting solely for the Company and not as an
officer, partner, employee or agent or one under the control or direction
of Distributor even though paid by it.
12. This Agreement may not be amended without the affirmative votes of a
majority of the Board of Directors, including a majority of those directors
who are not "interested persons" of the Company or of the Distributor,
voting in person at a meeting called for the purpose of voting on such
approval. Subject to this condition, this Agreement may be amended at any
time by mutual agreement in writing of the parties hereto.
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13. This Agreement shall be construed in accordance with and governed by
the laws of the State of Maryland.
IN WITNESS WHEREOF, this Agreement has been executed for the Distributor
and the Company and their respective corporate seals affixed hereto by their
duly authorized officers the day and year first above written.
PROVIDENT DISTRIBUTORS, INC.
Attest:
By:__________________________
________________________________
Secretary
(SEAL)
XXXXXXXX-XXXXX
GOVERNMENT
FUND, INC.
Asset:
By: /s/ Xxxxxx X. Xxxxx, Xx.
__________________________
________________________________
Secretary
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