EXHIBIT 6(a)
IDEX FUND 3
UNDERWRITING AGREEMENT
This Agreement is entered into as of April 22, 1992, between IDEX FUND
3, a Massachusetts business trust (the "Fund"), and InterSecurities, Inc.
(formerly known as Idex Distributors, Inc.), a Delaware corporation (the
"Distributor"). It is the purpose of this Agreement to express the mutual desire
and agreement of the parties that the Distributor act as principal underwriter
of the Fund's shares and use its best efforts to sell shares of the Fund as the
Fund's exclusive agent for the distribution of its shares. In consideration of
their mutual promises and undertakings set forth below, the parties agree as
follows:
1. APPOINTMENT AND AUTHORITY OF AGENT. The Fund appoints the
Distributor as its principal underwriter, to sell shares of beneficial interest
of the Fund during the term of this Agreement. While this Agreement is in force,
the Distributor agrees to use its best efforts to find purchasers for such
shares of the Fund.
The Distributor shall sell, as agent on behalf of the Fund, the shares
needed, but not more than the shares needed (except for clerical errors and
errors of transmission) to fill unconditional orders placed with the
Distributor, and the price which the Fund shall receive for shares so purchased
shall be the net asset value used in determining the public offering price on
which such orders were based. (The term "net asset value" as used in this
Agreement shall have the meaning assigned to it in the Fund's Declaration of
Trust, as amended from time to time.)
The Distributor shall notify the Custodian of the Fund, at the end of
each business day, or as soon thereafter as the orders placed with it in such
period have been compiled, of the number of shares and the prices thereof which
the Distributor shall have sold on behalf of the Fund. The Distributor shall use
its best efforts to cause the sums due for shares ordered from the Fund to be
collected or to be advanced to the Fund on behalf of the purchasers on or before
the seventh business day (excluding Saturdays) after the shares have been so
ordered.
The agency of the Distributor shall be exclusive, except that it shall
not apply to (1) shares issued in connection with the merger or consolidation of
any other investment company or entity with the Fund or the non-taxable
acquisition, by purchase or otherwise, of all (or substantially all) of the
assets or the outstanding shares of any company by the Fund, or (2) shares which
may be offered by the Fund to its shareholders for reinvestment of dividends and
capital gains distributions, whether declared in cash or in shares or cash at
the option of the shareholder.
The Fund may suspend the sale of its shares at any time by notice to
the Distributor for such period of time as the Fund deems desirable. Such a
suspension of sales shall not effect a termination of this Agreement.
2. TERMS OF SALE OF SHARES. The Fund's shares shall be sold by the
Distributor as agent on behalf of the Fund to dealers having sales agreements
with the Distributor and to investors upon the terms and conditions (including
minimum purchase requirements) set forth in the current prospectus
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relating to the Fund's shares and (to the extent not inconsistent with said
prospectus) upon the following terms and conditions:
a. PUBLIC OFFERING PRICE. The public offering price, which means the
price per share at which the Distributor or a dealer purchasing shares from the
Fund may sell shares to the public, shall be based upon the per share net asset
value determined as of the time specified in the then current prospectus
relating to the Fund's shares. The public offering price shall not exceed the
per share net asset value on the basis of which the applicable public offering
price is determined plus a sales charge as described in the then current
prospectus relating to the Funds' shares, which shall not exceed 8.5% of the
public offering price. The public offering price shall be adjusted to the nearer
cent. The Distributor shall fix, in its agreements with dealers, the portion of
the sales charge which may be reallowed to the dealers on the purchase of shares
from the Fund.
b. DETERMINATION OF NET ASSET VALUE. The Fund shall determine the net
asset value of the shares of the Fund (or cause such net asset value to be
determined) as of the close of the New York Stock Exchange on each business day
on which said Exchange is open, in accordance with the method set forth in the
Declaration of Trust. Upon due notice to the Distributor, the Fund may also
employ other methods or times in calculation of net asset value, to the extent
authorized by its Declaration of Trust and consistent with applicable federal
laws and the rules of the National Association of Securities Dealers, Inc. The
Fund shall also have the right to suspend the sale of its shares and the
calculation of net asset value if, because of some extraordinary condition, the
New York Stock Exchange shall be closed, or if, in the judgment of a majority of
the members of the Trustees of the Fund, or its Executive Committee, conditions
existing during the hours when said Exchange is open render such action
advisable.
c. CONFIRMATIONS. The Distributor shall issue and deliver on behalf of
the Fund or cause to be issued and delivered all confirmations of transactions
effected hereunder for the account of the Fund.
3. NECESSARY CORPORATE ACTION. The Fund agrees that it will, from time
to time, but subject to any necessary approval of its shareholders, take all
appropriate action fixing the number of its authorized shares, and such other
steps as may be necessary to register the same under the Securities Act of 1933,
to the end that there will be available for sale such number of shares as the
Distributor may reasonably be expected to sell. The Fund plans to discontinue
sales of its shares except to existing shareholders when it reaches $500,000,000
in net assets.
4. INDEMNITY OF FUND BY DISTRIBUTOR. The Distributor will indemnify and
hold harmless the Fund and each of its officers and trustees and each person, if
any, who controls the Fund within the meaning of Section 15 of the Securities
Act of 1933, against any loss, liability, damage, claim, or expense (including
the reasonable cost of investigating or defending any alleged loss, liability,
damage, claim or expense and reasonable counsel fees incurred in connection
therewith), arising by reason of or in connection with any person acquiring any
shares of the Fund, which may be based upon the Securities Act of 1933 or any
other statute or on the common law, on account of any wrongful act of the
Distributor or any of its employees or on the ground that the registration
statement or prospectus, as from time to time amended and supplemented, includes
an untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary
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in order to make the statements therein not misleading, insofar as any such
statement or omission was made in reliance upon, and in conformity with,
information furnished to the Fund in connection therewith by or on behalf of the
Distributor, provided, however, that in no case shall (1) the indemnity of the
Distributor in favor of any person indemnified be deemed to protect the Fund or
any such person against any liability to which the Fund or any such person would
otherwise be subject by reason of willful misfeasance, bad faith, or gross
negligence in the performance of its (or his) duties or by reason of its (or
his) reckless disregard of its (or his) obligations and duties under this
Agreement, or (2) the Distributor be liable under its indemnity agreement
contained in this paragraph with respect to any claim made against the Fund or
any person indemnified unless the Fund or such person, as the case may be, shall
have notified the Distributor in writing within a reasonable time after the
summons or first legal process giving notice of the claim shall have been served
upon the Fund or upon such person (or after the Fund or such person shall have
received notice of such service on any designated agent), but failure to notify
the Distributor of any such claim shall not relieve it from any liability which
it may have to the Fund or any person against whom such action is brought
otherwise than on account of its indemnity agreement contained in this
paragraph. In the case of any such notice to the Distributor, it shall be
entitled to participate, at its own expense, in the defense or, if it so elects,
to assume the defense of any suit brought to enforce any such liability, but, if
the Distributor elects to assume the defense, such defense shall be conducted by
counsel chosen by it and satisfactory to the Fund, and to those of its officers,
trustees or controlling persons who are defendants in the suit. In the event
that the Distributor elects to assume the defense of any such suit and retain
such counsel, the Fund and those of its officers, trustees or controlling
persons who are defendants in the suit shall bear the fees and expenses of any
additional counsel retained by them, but, in case the Distributor does not elect
to assume the defense of any such suit, it shall reimburse them for the
reasonable fees and expenses of any counsel so retained by them. The Fund agrees
to notify the Distributor promptly of the commencement of any litigation or
proceedings against it in connection with the issue and sale of any of the
shares.
5. INDEMNITY OF DISTRIBUTOR BY FUND. The Fund will indemnify and hold
harmless the Distributor and each of its officers and directors and each person,
if any, who controls the Distributor within the meaning of Section 15 of the
Securities Act of 1933 against any loss, liability, claim, damage or expense
(including the reasonable cost of investigating or defending any alleged loss,
liability, claim, damage or expense and reasonable counsel fees incurred in
connection therewith), arising by reason of or in connection with any person
acquiring any of its shares, which may be based upon the Securities Act of 1933
or on any other statute or on the common law, on the ground that the
registration statement or prospectus, as from time to time amended and
supplemented, includes an untrue statement of a material fact or omits to state
a material fact required to be stated therein or necessary in order to make the
statement therein not misleading, unless such statement or omission was made in
reliance upon, and in conformity with, information furnished to the Fund in
connection therewith by or on behalf of the Distributor; provided, however, that
in no case shall (1) the indemnity of the Fund in favor of the Distributor and
any such controlling person be deemed to protect the Distributor or any such
controlling person against any liability to which the Distributor (or any such
controlling person) would otherwise be subject by reason of its willful
misfeasance, bad faith, or gross negligence in the performance of its (or his)
duties or by reason of its (or his) reckless disregard of its (or his)
obligations and duties under this Agreement, or (2) the Fund be liable under its
indemnity agreement contained in this paragraph with respect to any claim made
against the Distributor (or any such controlling person) unless the
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Distributor or such controlling person, as the case may be, shall have notified
the Fund in writing within a reasonable time after the summons or first legal
process giving notice of the claim shall have been served upon the Distributor
or upon such controlling person (or after such Distributor or controlling person
shall have received notice of such service on any designated agent), but failure
to notify the Fund of any such claim shall not relieve it from any liability
which it may have to the person against whom such action is brought otherwise
than on account of its indemnity agreement contained in this paragraph. The Fund
will be entitled to participate at its own expense in the defense or, if it so
elects, to assume the defense of any suit brought to enforce any such liability,
but, if the Fund elects to assume the defense, such defense shall be conducted
by counsel chosen by it and satisfactory to the Distributor and to the
controlling persons who are defendants in the suit. In the event the Fund elects
to assume the defense of any such suit and retain such counsel, the Distributor
or persons who are defendants in the suit shall bear the fees and expenses of
any additional counsel retained by them, but, in case the Fund does not elect to
assume the defense of any such suit, it will reimburse them for the reasonable
fees and expenses of any counsel so retained by them. The Distributor agrees to
notify the Fund promptly of the commencement of any litigation or proceedings
against it or any of its officers or directors in connection with the issuance
or sale of any of the shares.
6. COMPLIANCE WITH SECURITIES LAWS. The Distributor, in selling the
shares of the Fund, will in all respects duly conform with all federal and state
laws relating to the sale of such securities.
7. AUTHORIZED REPRESENTATIONS. Neither the Distributor, any dealer nor
any other person is authorized by the Fund to give any information or to make
any representations, other than those contained in the registration statement or
prospectus filed with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (as said registration statement and
prospectus may be amended or supplemented from time to time), covering the
shares of the Fund, or in such other sales literature as the Fund may expressly
authorize the Distributor to use. No dealer (except the Distributor acting as
agent of the Fund for the account of the Fund) is authorized to act as agent for
the Fund in connection with the offering or sale of shares of the Fund to the
public or otherwise.
8. COSTS TO BE INCURRED BY DISTRIBUTOR. In addition to the expenses
which the Distributor may incur in the performance of its own functions under
this Agreement, and the expenses which it may expressly undertake to pay under
other agreements with the Fund or otherwise, the Distributor will pay:
a. The expenses of printing and distributing prospectuses (in addition
to those required for filing with federal and state agencies) and preparing,
printing and distributing all other sales literature used by the Distributor or
by dealers (including copies of the Fund's reports to shareholders or federal or
state regulatory agencies, in addition to those needed for the regular mailing
or filing, which the Fund may permit to be used as sales literature) in
connection with the offering of Fund shares for sale to the public and any
expenses of advertising in connection with such offering. The Fund will pay all
of its own expenses, except as expressly provided herein or in any other
agreements which the Fund may have with the Distributor or any other person.
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9. VOLUNTARY REPURCHASE OF SHARES BY THE FUND. The Fund reserves the
right, by resolution of its Trustees, to authorize and require the Distributor
to repurchase, upon prices, terms and conditions to be set forth in such
resolution, as agent of the Fund and for its account, such shares of the Fund as
may be offered for voluntary repurchase by the Fund from time to time.
10. LONG OR SHORT POSITIONS. The Distributor agrees that it will not
take any long or short positions in the shares of the Fund except to the extent
contemplated by paragraphs 1 and 9 above, and that, so far as it can control the
situation, it will prevent any officer or director of (or person financially
interested in) the Distributor from taking any long or short position in the
shares of the Fund, except as permitted by the Declaration of Trust of the Fund
and by those portions of its Bylaws which are not subject to amendment except by
the shareholders of the Fund.
11. AMENDMENTS. This Agreement may be supplemented or amended by mutual
consent of the parties, provided that no amendment hereto shall be effective
unless approved by a majority of the trustees of the Fund who are not interested
persons (as that term is defined in Section 2(a)(19) of the Investment Company
Act of 1940, as amended) of the Distributor, cast in person at a meeting called
for the purpose of voting on such approval. If, at any time during the existence
of this Agreement, the Fund shall in good xxxxx xxxx it necessary or advisable
in the best interests of the Fund that any amendment of this Agreement be made
in order to comply with the recommendations or requirements of the Securities
and Exchange Commission or other governmental authority or to obtain any proper
advantage under federal or state tax laws, and shall notify the Distributor of
the form of amendment which it deems necessary or advisable and the reasons
therefor, and, if the Distributor declines to assent to such amendment, the Fund
may terminate this Agreement immediately, upon written notice. If, at any time
during the existence of this Agreement, upon request by the Distributor, the
Fund fails (after a reasonable time) to make any changes in its governing
instruments, or in its methods of doing business, which are in good faith deemed
by the Distributor to be necessary in order to comply with federal law or the
lawful requirements of the Securities and Exchange Commission or of the National
Association of Securities Dealers, Inc. relating to the sale of the shares of
the Fund, the Distributor may terminate this Agreement immediately, upon written
notice.
12. TERM. This Agreement shall continue in effect unless sooner
terminated in accordance with its terms for one year from the date hereof and
shall continue in effect from year to year thereafter only so long as such
continuance is specifically approved at least annually by the Trustees of the
Fund or by the affirmative vote of a majority of the outstanding voting
securities of the Fund (as that phrase is defined in Section 2(a)(42) of the
Investment Company Act of 1940, as amended); provided that no renewal hereof
shall be effective unless the terms of such renewal have been approved by the
vote of a majority of the Trustees of the Fund who are not interested parties
(as that term is defined in Section 2(a)(19) of the Investment Company Act of
1940, as amended) of the Distributor, cast in person at a meeting called for the
purpose of voting on the approval of the terms of such renewal. Either party
shall have the right to terminate this Agreement upon 60 days' written notice
given to the other party.
13. ASSIGNMENT. In the event of the assignment (as defined in Section
2(a)(4) of the Investment Company Act of 1940, as amended) of this Agreement by
the Distributor, this Agreement shall automatically terminate.
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14. PRIOR AGREEMENTS. This agreement supersedes all prior agreements
between the parties relating to the subject matter hereof, and all such prior
agreements are deemed terminated upon the effectiveness of this agreement.
15. LIMITATION OF LIABILITY. A copy of the Fund's Declaration of Trust
is on file with the Secretary of The Commonwealth of Massachusetts, and notice
is hereby given that this Agreement is executed on behalf of the Trustees as
Trustees of the Fund and not individually, and that the obligations under this
Agreement are not binding upon any of the Trustees, officers, shareholders,
agents or employees of the Fund individually, but binding only upon the assets
and property of the Fund.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first appearing above.
ATTEST: IDEX FUND 3
/s/ XXXXXX X. XXXX By: /s/ G. XXXX XXXXXX
------------------------- -------------------------------------
Xxxxxx X. Xxxx, Secretary G. Xxxx Xxxxxx, President and Chief
Executive Officer
ATTEST: INTERSECURITIES, INC.
/s/ XXXXXXX X. XXXXXX By: /s/ XXXX X. XXXXXX
---------------------------- -------------------------------------
Xxxxxxx X. Xxxxxx, Secretary Xxxx X. Xxxxxx, Chairman of the Board
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