XXXXX XXXXX ADVISERS SENIOR FLOATING-RATE FUND
DISTRIBUTION AGREEMENT
AGREEMENT dated February 20, 1998 between XXXXX XXXXX ADVISERS SENIOR
FLOATING-RATE FUND, a Massachusetts business trust having its principal place of
business in Boston in the Commonwealth of Massachusetts, hereinafter called the
"Fund," and XXXXX XXXXX DISTRIBUTORS, INC., a Massachusetts corporation having
its principal place of business in said Boston, hereinafter sometimes called the
"Principal Underwriter."
IN CONSIDERATION of the mutual promises and undertakings herein contained,
the parties hereto agree:
1. The Fund grants to the Principal Underwriter the right to purchase
common shares of the Fund upon the terms hereinbelow set forth during the term
of this Agreement. While this Agreement is in force, the Principal Underwriter
agrees to use its best efforts to find purchasers for shares of the Fund.
The Principal Underwriter shall have the right to buy from the Fund the
shares needed, but not more than the shares needed (except for clerical errors
and errors of transmission) to fill unconditional orders for shares of the Fund
placed with the Principal Underwriter by financial service firms or investors as
set forth in the current Prospectus relating to shares of the Fund. The price
which the Principal Underwriter shall pay for the shares so purchased shall be
equal to the net asset value used in determining the public offering price to be
paid by investors upon purchasing such shares. The Principal Underwriter shall
notify Investors Bank & Trust Company, Custodian of the Fund, ("IBT"), and First
Data Investor Services Group, Transfer Agent of the Fund ("First Data"), or a
successor transfer agent, at the end of each business day, or as soon thereafter
as the orders placed with it have been compiled, of the number of shares and the
prices thereof which the Principal Underwriter is to purchase as principal for
resale. The Principal Underwriter shall take down and pay for shares ordered
from the Fund on or before the eleventh business day (excluding Saturdays) after
the shares have been so ordered.
The right granted to the Principal Underwriter to buy shares from the Fund
shall be exclusive, except that said exclusive right shall not apply to shares
issued in connection with the merger or consolidation of any other investment
company or personal holding company with the Fund or the acquisition by purchase
or otherwise of all (or substantially all) the assets or the outstanding shares
of any such company, by the Fund; nor shall it apply to shares, if any, issued
by the Fund in distribution of net investment income or realized capital gains
of the Fund payable in shares or in cash at the option of the shareholder.
2. The shares may be resold by the Principal Underwriter to or through
financial service firms having agreements with the Principal Underwriter, and to
investors, upon the following terms and conditions.
The public offering price, i.e., the price per share at which the Principal
Underwriter or financial service firm purchasing shares from the Principal
Underwriter may sell shares to the public, shall be equal to the net asset value
at which the Principal Underwriter is to purchase the shares.
The net asset value of shares of the Fund shall be determined by the Fund
or IBT, as the agent of the Fund, as of the close of regular trading on the New
York Stock Exchange (the "Exchange") on each business day on which said Exchange
is open, or as of such other time on each such business day as may be determined
by the Trustees of the Fund, in accordance with the methodology and procedures
for calculating such net asset value authorized by the Trustees. The Fund may
also cause the net asset value to be determined in substantially the same manner
or estimated in such manner and as of such other time or times as may from time
to time be agreed upon by the Fund and Principal Underwriter. The Fund will
notify the Principal Underwriter each time the net asset value of shares is
determined and when such value is so determined it shall be applicable to
transactions as set forth in the current Prospectus and Statement of Additional
Information (hereinafter the "Prospectus") relating to the Fund's shares.
No shares of the Fund shall be sold by the Fund during any period when the
determination of net asset value is suspended pursuant to the Agreement and
Declaration of Trust, except to the Principal Underwriter, in the manner and
upon the terms above set forth to cover contracts of sale made by the Principal
Underwriter with its customers prior to any such suspension, and except as
provided in the last paragraph of paragraph 1 hereof. The Fund shall also have
the right to suspend the sale of its shares if in the judgment of the Fund
conditions obtaining at any time render such action advisable. The Principal
Underwriter shall have the right to suspend sales at any time, to refuse to
accept or confirm any order from an investor or financial service firm, or to
accept or confirm any such order in part only, if in the judgment of the
Principal Underwriter such action is in the best interests of the Fund.
3. The Fund agrees that it will, from time to time, but subject to the
necessary approval of the shareholders, take such steps as may be necessary to
register its shares under the federal Securities Act of 1933, as amended from
time to time (the "1933 Act"), to the end that there will be available for sale
such number of shares as the Principal Underwriter may reasonably be expected to
sell. The Fund agrees to indemnify and hold harmless the Principal Underwriter
and each person, if any, who controls the Principal Underwriter within the
meaning of Section 15 of the 1933 Act against any loss, liability, claim,
damages or expense (including the reasonable cost of investigating or defending
any alleged loss, liability, claim, damages or expense and reasonable counsel
fees incurred in connection therewith), arising by reason of any person
acquiring any shares, which may be based upon the 1933 Act or on any other
statute or at 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 statements therein not
misleading, unless such statement or omission was made in reliance upon, and in
conformity with, information furnished in writing to the Fund in connection
therewith by or on behalf of the Principal Underwriter; provided, however, that
in no case (i) is the indemnity of the Fund in favor of the Principal
Underwriter and any such controlling person to be deemed to protect such
Principal Underwriter or any such controlling person against any liability to
the Fund or its security holders to which such Principal Underwriter or any such
controlling person would otherwise be subject by reason of willful misfeasance,
bad faith, or gross negligence in the performance of its duties or by reason of
its reckless disregard of its obligations and duties under this Agreement, or
(ii) is the Fund to be liable under its indemnity agreement contained in this
paragraph with respect to any claim made against the Principal Underwriter or
any such controlling person unless the Principal Underwriter or such controlling
person, as the case may be, shall have notified the Fund in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the Principal
Underwriter or upon such controlling person (or after such Principal Underwriter
or such 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 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 Fund elects to assume the
defense, such defense shall be conducted by counsel chosen by it and
satisfactory to the Principal Underwriter or controlling person or persons,
defendant or defendants in the suit. In the event the Fund elects to assume the
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defense of any such suit and retains such counsel, the Principal Underwriter or
controlling person or persons, defendant or 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 shall
reimburse the Principal Underwriter or controlling person or persons, defendant
or defendants in the suit, for the reasonable fees and expenses of any counsel
retained by them. The Fund agrees promptly to notify the Principal Underwriter
of the commencement of any litigation or proceedings against it or any of its
officers or Trustees in connection with the issuance or sale of any of the
shares.
4. The Principal Underwriter covenants and agrees that, in selling the
shares of the Fund, it will use its best efforts in all respects duly to conform
with the requirements of all state and federal laws relating to the sale of such
securities, and will indemnify and hold harmless the Fund and each of its
Trustees and officers and each person, if any, who controls the Fund within the
meaning of Section 15 of the 1933 Act against any loss, liability, damages,
claim or expense (including the reasonable cost of investigating or defending
any alleged loss, liability, damages, claim or expense and reasonable counsel
fees incurred in connection therewith), arising by reason of any person
acquiring any shares, which may be based upon the 1933 Act or any other statute
or at common law, on account of any wrongful act of the Principal Underwriter or
any of its employees (including any failure to conform with any requirement of
any state or federal law relating to the sale of such securities) 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 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 in writing to the Fund in connection therewith by or on
behalf of the Principal Underwriter, provided, however, that in no case (i) is
the indemnity of the Principal Underwriter in favor of any person indemnified to
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 obligations and
duties under this Agreement, or (ii) is the Principal Underwriter to 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 Principal Underwriter in
writing within a reasonable time after the summons or other first legal process
giving information of the nature 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
Principal Underwriter 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. The Principal Underwriter 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 Principal Underwriter
elects to assume the defense, such defense shall be conducted by counsel chosen
by it and satisfactory to the Fund, or to its officers or Trustees, or to any
controlling person or persons, defendant or defendants in the suit. In the event
that the Principal Underwriter elects to assume the defense of any such suit and
retains such counsel, the Fund or such officers or Trustees or controlling
person or persons, defendant or defendants in the suit, shall bear the fees and
expenses of any additional counsel retained by them, but, in case the Principal
Underwriter does not elect to assume the defense of any such suit, it shall
reimburse the Fund, any such officers and Trustees or controlling person or
persons, defendant or defendants in such suit, for the reasonable fees and
expenses of any counsel retained by them. The Principal Underwriter agrees
promptly to notify the Fund of the commencement of any litigation or proceedings
against it in connection with the issue and sale of any of the shares.
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Neither the Principal Underwriter nor any financial service firm 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 (the "Commission")
under the 1933 Act, as amended (as said Registration Statement and Prospectus
may be amended or supplemented from time to time), covering the shares of the
Fund. Neither the Principal Underwriter nor any financial service firm nor any
other person 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. All such
sales made by the Principal Underwriter shall be made by it as principal, for
its own account. The Principal Underwriter may, however, act as agent in
connection with "exchanges" between investment companies for which the Principal
Underwriter acts as Principal Underwriter or for which as affiliate of the
Principal Underwriter acts as investment adviser.
5(a). The Fund will pay, or cause to be paid -
(i) all the costs and expenses of the Fund, including fees and
disbursements of its counsel, in connection with the preparation and filing
of any required Registration Statement and/or Prospectus under the 1933
Act, or the Investment Company Act of 1940 (the "1940 Act") covering its
shares and all amendments and supplements thereto, and preparing and
mailing periodic reports and Prospectuses to shareholders (including the
expense of setting up in type any such Registration Statement, Prospectus
or periodic report);
(ii) the cost of preparing temporary and permanent share certificates
(if any) for shares of the Fund;
(iii) the cost and expenses of delivering to the Principal Underwriter
at its office in Boston, Massachusetts, all shares purchased by it as
principal hereunder;
(iv) all the federal and state (if any) issue and/or transfer taxes
payable upon the issue by or (in the case of treasury shares) transfer from
the Fund to the Principal Underwriter of any and all shares purchased by
the Principal Underwriter hereunder;
(v) all costs and expenses of conducting the Fund's periodic tender
offers for, or other repurchases or redemptions of, shares issued by the
Fund;
(vi) all payments to be made by the Fund pursuant to any written
service plan.
(b) The Principal Underwriter agrees that, after the Prospectus (other than
to existing shareholders of the Fund) and periodic reports have been set up in
type, it will bear the expense of printing and distributing any copies thereof
which are to be used in connection with the offering of shares of the Fund to
financial service firms or investors. The Principal Underwriter further agrees
that it will bear the expenses of preparing, printing and distributing any other
literature used by the Principal Underwriter or furnished by it for use by
financial service firms in connection with the offering of the shares of the
Fund for sale to the public and any expenses of advertising in connection with
such offering. The Fund agrees to pay the expenses of registration and
maintaining registration of its shares for sale under federal and state
securities laws, and, if necessary or advisable in connection therewith, of
qualifying the Fund as a dealer or broker, in such states as shall be selected
by the Principal Underwriter and the fees payable to each such state for
continuing the qualification therein until the Principal Underwriter notifies
the Fund that it does not wish such qualification continued.
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(c) The Principal Underwriter shall be entitled to receive any Early
Withdrawal Charges paid or payable on repurchases of shares by the Fund pursuant
to any repurchase or tender offer made by the Fund.
6. If, at any time during the existence of this Agreement, the Fund shall
deem 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 Commission or other governmental authority or to obtain
any advantage under Massachusetts or federal tax laws, and shall notify the
Principal Underwriter of the form of amendment which it deems necessary or
advisable and the reasons therefor, and, if the Principal Underwriter declines
to assent to such amendment, the Fund may terminate this Agreement forthwith by
written notice to the Principal Underwriter. If, at any time during the
existence of its agreement upon request by the Principal Underwriter, the Fund
fails (after a reasonable time) to make any changes in its Declaration of Trust,
as amended, or in its methods of doing business which are necessary in order to
comply with any requirement of federal law or regulations of the Commission or
of a national securities association of which the Principal Underwriter is or
may be a member, relating to the sale of the shares of the Fund, the Principal
Underwriter may terminate this Agreement forthwith by written notice to the
Fund.
7(a). The Principal Underwriter is a corporation in the United States
organized under the laws of Massachusetts and holding membership in the National
Association of Securities Dealers, Inc., a securities association registered
under Section 15A of the Securities Exchange Act of 1934, as amended from time
to time, and during the life of this Agreement will continue to be so resident
in the United States, so organized and a member in good standing of said
Association. The Principal Underwriter will comply with the Fund's Agreement and
Declaration of Trust and By-Laws, and the 1940 Act, and the rules promulgated
thereunder, insofar as they are applicable to the Principal Underwriter.
(b) The Principal Underwriter shall maintain in the United States and
preserve therein for such period or periods as the Commission shall prescribe by
rules and regulations applicable to it as Principal Underwriter of a closed-end
investment company registered under the 1940 Act such accounts, books and other
documents as are necessary or appropriate to record its transactions with the
Fund. Such accounts, books and other documents shall be subject at any time and
from time to time to such reasonable periodic, special and other examinations by
the Commission or any member or representative thereof as the Commission may
prescribe. The Principal Underwriter shall furnish to the Commission within such
reasonable time as the Commission may prescribe copies of or extracts from such
records which may be prepared without effort, expense or delay as the Commission
may by order require.
8. This Agreement shall continue in force indefinitely until terminated as
in this Agreement above provided, except that:
(a) this Agreement shall continue in effect through and including April 28,
1999 and shall continue in full force and effect indefinitely thereafter, but
only so long as such continuance is specifically approved at least annually (i)
by the vote of a majority of the Trustees of the Fund who are not "interested
persons" of the Fund or of the Principal Underwriter cast in person at a meeting
called for the purchase of voting on such approval, and (ii) by the Board of
Trustees of the Fund or by vote of a majority of the outstanding voting
securities of the Fund; and
(b) either party shall have the right to terminate this Agreement on six
(6) months' written notice thereof given in writing to the other party.
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9. In the event of the assignment of this Agreement by the Principal
Underwriter, this Agreement shall automatically terminate.
10. Any notice under this Agreement shall be in writing, addressed and
delivered, or mailed postage paid, to the other party, at such address as such
other party may designate for the receipt of such notices. Until further notice
to the other party, it is agreed that the record address of the Fund, and that
of the Principal Underwriter, shall be 00 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000.
11. The services of the Principal Underwriter to the Fund hereunder are not
to be deemed to be exclusive, the Principal Underwriter being free to (a) render
similar services to, and to act as principal underwriter in connection with the
distribution of shares of, other investment companies, and (b) engage in other
businesses and activities from time to time.
12. The terms "vote of a majority of the outstanding voting securities,"
"assignment" and "interested persons," when used herein, shall have the
respective meanings specified in the 1940 Act, subject, however, to such
exemptions as may be granted by the Commission by any rule, regulation or order.
13. The Principal Underwriter expressly acknowledges the provision in the
Fund's Agreement and Declaration of Trust limiting the personal liability of the
shareholders of the Fund or the Trustees of the Fund. The Principal Underwriter
hereby agrees that it shall have recourse only to the assets of the Fund for
payment of claims or obligations as between the Fund, and the Principal
Underwriter arising out of this Agreement and shall not seek satisfaction from
any shareholders of the Fund or from the Trustees or any Trustee of the Fund.
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement on
the 20th day of February, 1998.
XXXXX XXXXX ADVISERS SENIOR
FLOATING-RATE FUND
By: /s/ Xxxxx X. Xxxxxx
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President
XXXXX XXXXX DISTRIBUTORS, INC.
By: /s/ Xxxx X. Xxxxxx
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Vice President
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