EXHIBIT h
DISTRIBUTION AGREEMENT
THIS AGREEMENT is made as of this ____ day of __________ between The
Oxbow Fund, LLC (the "Fund"), a New Jersey limited liability company, and C.J.M.
Planning Corp., a New Jersey corporation ("CJM" or the "Distributor").
WHEREAS, the Fund has elected to be regulated as a business development
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and its units are registered with the Securities and Exchange Commission (the
"SEC") under the Securities Act of 1933, as amended (the "1933 Act") and the
Securities Exchange Act of 1934, as amended ("1934 Act"); and
WHEREAS, the Distributor is registered as a broker-dealer with the SEC
under the 1934 Act.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, the Fund and Distributor hereby agree as follows:
ARTICLE 1. Sale of Units. The Fund grants to the Distributor the
exclusive right to sell Units (the "Units") of the Fund at the price set forth
in the Prospectus (which shall not be less than the Fund's net asset value per
Unit) as agent and on behalf of the Fund, in accordance with the terms of this
Agreement and subject to the registration requirements of the 1933 Act and the
1934 Act, the rules and regulations of the SEC and the laws governing the sale
of securities in the various states ("Blue Sky Laws"). Offers and sales of Units
shall conform to the requirements of the Prospectus and the Subscription
Agreement. Without limitation of the foregoing, each prospective investor shall
duly complete and execute a Subscription Agreement and Operating Agreement
Signature Page and Power of Attorney and, in connection with each subscription,
include a check made payable to "The Oxbow Fund, LLC."
ARTICLE 2. Solicitation of Sales. In consideration of these rights
granted to the Distributor, the Distributor agrees to use its best efforts in
connection with the distribution of Units of the Fund; provided, however, that
the Distributor shall not be prevented from entering into like arrangements with
other issuers. The provisions of this paragraph do not obligate the Distributor
to register as a broker or dealer under the Blue Sky Laws of any jurisdiction if
it determines it would be uneconomical for it to do so or to maintain its
registration in any jurisdiction in which it is now registered nor obligate the
Distributor to sell any particular number of Units. The Distributor may contract
with other distributors that are members of the NASD who will use their best
efforts to offer and sell the Units pursuant to a "Selected Distributor
Agreement" substantially in the form of Exhibit A hereto. Such other
distributors will be compensated by the Fund in the manner the Fund would
compensate the Distributor hereunder if such Units sold by the other
distributors were sold by the Distributor.
In connection with the solicitation of all prospective sales of Units,
Distributor shall comply with all requirements of the NASD, including NASD
Conduct Rules, and in
recommending the purchase of Units, shall have reasonable grounds to
believe, on the basis of information obtained from prospective investors that
such investors satisfy the criteria set forth in Rules 2810(b)(2)(B)(i) and (ii)
of the NASD Conduct Rules.
ARTICLE 3. Authorized Representatives. The Distributor is not
authorized by the Fund to give any information or to make any representations
other than those contained in the current registration statement and prospectus
of the Fund filed with the SEC or contained in shareholder reports or other
material that may be prepared by or on behalf of the Fund for the Distributor's
use. The Distributor may prepare and distribute sales literature and other
material as it may deem appropriate, provided that such literature and materials
have been approved by the Fund prior to their use.
ARTICLE 4. Registration of Units. The Fund agrees that it will take all
action necessary to register Units under the federal and state securities laws
so that there will be available for sale the number of Units the Distributor may
reasonably be expected to sell and to pay all fees associated with said
registration. The Fund shall make available its currently effective prospectus
for the entire offering period as described therein. The Fund shall make
available to the Distributor copies of all information, financial statements and
other papers which the Distributor may reasonably request for use in connection
with the distribution of Units of the Fund.
ARTICLE 5. Compensation. As compensation for providing the services
under this Agreement the Fund shall pay to the Distributor a sales charge equal
to $7 per Unit sold as described in the Fund's current prospectus, as amended
from time to time, and shall reimburse the Distributor for its accountable
expenses associated with its due diligence of the Fund. In any event, the total
of all selling compensation to the Distributor will not exceed 10% of the gross
proceeds of the sale of Units, and the aggregate amount of accountable expenses
reimburseable by the Fund to the Distributor for its due diligence of the Fund
will not exceed .5% of such gross proceeds.
ARTICLE 6. Indemnification of Distributor. The Fund agrees to indemnify
and hold harmless the Distributor and each of its directors and officers and
each person, if any, who controls the Distributor 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 and
disbursements incurred in connection therewith), arising by reason of any person
acquiring any Units, based on the ground that the registration statement,
prospectus, shareholder reports or other information filed or mad public by the
Fund (as from time to time amended) included an untrue statement of a material
fact or omitted to state a material fact required to be stated or necessary in
order to make the statements made not misleading. However, the Fund does not
agree to indemnify the Distributor or hold it harmless to the extent that the
statements or omission was made in reliance upon, and in conformity with,
information furnished to the Fund by or on behalf of the Distributor.
In no cases (i) is the indemnity of the Fund to be deemed to protect
the Distributor against any liability to the Fund or its shareholders to which
the Distributor or such person
-2-
otherwise would 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 to the Distributor under the indemnity agreement
contained in this paragraph with respect to any claim made against the
Distributor or any person indemnified unless the Distributor or other person
shall have notified the Fund in writing of the claim within a reasonable time
after the summons or other first written notification giving information of the
nature of the claim shall have been served upon the Distributor or such other
person (or after the Distributor or the person shall have received notice of
service on any designated agent). However, failure to notify the Fund of any
claim shall not relieve the Fund from any liability which is may have to the
Distributor or any 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 claims subject to this indemnity provision. If the Fund elects to
assume the defense of any such claim, the defense shall be conducted by counsel
chosen by the Fund and satisfactory to the indemnified defendants in the suit
whose approval shall not be unreasonably withheld. In the event that the Fund
elects to assume the defense of any suit and retain counsel, the indemnified
defendants shall bear the fees and expenses of any additional counsel retained
by them. If the Fund does not elect to assume the defense of a suit, it will
reimburse the indemnified defendants for the reasonable fees and expenses of any
counsel retained by the indemnified defendants.
The Fund agrees to notify the Distributor 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 its Units.
ARTICLE 7. Indemnification of Fund. The Distributor covenants and
agrees that it will indemnify and hold harmless the Fund and each of its
directors and officers and each person, if any, who controls the Fund within the
meaning of Section 15 of the 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) based upon the 1933 Act, 1934 Act, 1940 Act or any
other statute or common law and arising by reason of any person acquiring any
Shares, and alleging a wrongful act of the Distributor of any of its employees
or alleging that the registration statement, prospectus, Shareholder reports or
other information filed or made public by the Fund (as from time to time
amended) included an untrue statement of a material fact or omitted to state a
material fact required to be stated or necessary in order to make the statements
not misleading, insofar as the statement or omission was made in reliance upon
and in conformity with information furnished to the Fund by or on behalf of the
Distributor.
In no case (i) is the indemnity of the Distributor in favor of the Fund
or any other person indemnified to be deemed to protect the Fund or any other
person against any liability to which the Fund or such other 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
Distributor to be liable under the indemnity agreement contained in this
paragraph with respect to any claim made against the
-3-
Fund or any person indemnified unless the Fund or person, as the case may be,
shall have notified the Distributor in writing of the claim within a reasonable
time after the summons or other first written notification giving information of
the nature of the claim shall have been served upon the Fund or upon any person
(or after the Fund or such person shall have received notice of service on any
designated agent). However, failure to notify the Distributor of any claim shall
not relieve the Distributor from any liability which it may have to the Fund or
any person against whom the action is brought otherwise than on account of its
indemnify agreement contained in this paragraph.
The Distributor 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 the claim, but if the Distributor elects to assume the defense, the
defense shall be conducted by counsel chosen by the Distributor and satisfactory
to the indemnified defendants whose approval shall not be unreasonably withheld.
In the event that the Distributor elects to assume the defense of any suit and
retain counsel, the defendants in the suit shall bear the fees and expenses of
any additional counsel retained by them. If the Distributor does not elect to
assume the defense of any suit, it will reimburse the indemnified defendants in
the suit for the reasonable fees and expenses of any counsel retained by them.
The Distributor agrees to notify the Fund promptly of the commencement
of any litigation or proceedings against it in connection with the issue and
sale of any of the Fund's Shares.
ARTICLE 8. Effective Date. This Agreement shall be effective upon its
execution, and unless terminated as provided, shall continue in force for two
year(s) from the effective date. This Agreement shall automatically terminate in
the event of its assignment. As used in this paragraph the term "assignment"
shall have the meaning specified in the 1940 Act. In addition, this Agreement
may at any time be terminated without penalty by Distributor, by a vote of a
majority of Independent Directors of the Fund or by vote of a majority of the
outstanding voting securities of the Fund upon not less than sixty days prior
written notice to the other party.
ARTICLE 9. Notices. Any notice required or permitted to be given by
either party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, addressed by the party giving notice to the
other party at the last address furnished by the other party to the party giving
notice: if to the Fund or the Distributor notices shall be sent to 000 Xxxxxxx
Xxxxxx, Xxxxxxx Xxxxx, Xxx Xxxxxx 00000.
ARTICLE 10. Limitation of Liability. A copy of the Operating Agreement
of the Fund has been provided to the Distributor and notice is hereby given that
this Agreement is executed on behalf of the directors of the Fund as directors
and not individually and that the obligations of this instrument are not binding
upon any of the directors, officers or unitholders of the Fund individually but
binding only upon the assets and property of the Fund.
ARTICLE 11. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New Jersey and the applicable
provisions of the 1940 Act. To the extent
-4-
that the applicable laws of the State of New Jersey, or any of the provisions
herein, conflict with the applicable provisions of the 1940 Act, the latter
shall control.
ARTICLE 12. Multiple Originals. This Agreement may be executed in two
or more counterparts, each of which when so executed shall be deemed to be an
original, but such counterparts shall together constitute but one and the same
instrument.
-5-
IN WITNESS, the Fund and Distributor have each duly executed this
Agreement, as of the day and year above written.
THE OXBOW FUND
By: C.J.M. Asset Management, LLC
Investment Manger
By:_________________________________
Name:
Title:
C.J.M. PLANNING CORP.
By:________________________________
Name:
Title:
-6-
Exhibit A
C.J.M. Planning Corp
000 Xxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxx Xxxxxx 00000
The Oxbow Fund, LLC
250,000 Units
SELECTED DISTRIBUTOR AGREEMENT
_________________, 2000
Dear Sirs:
We as the Distributor named in the Prospectus dated __________, 2000
have agreed, subject to the terms and conditions of the Distribution Agreement
dated this date (the "Distribution Agreement"),to use our best efforts to sell
on behalf of The Oxbow Fund, LLC. (the "Company"), at the price set forth in the
Prospectus, the above referred to 250,000 Units (collectively being called the
"Securities"). The Securities and certain of the terms on which they are being
purchased and offered are more fully described in the enclosed Prospectus.
Additional copies of the Prospectus will be supplied to you in reasonable
quantities upon request.
We, as the Distributor, are offering to certain distributors ("Selected
Distributors"), among whom we are pleased to include you, the right to sell on a
"best efforts" basis, the Securities at the public offering price. The offering
to Selected Distributors is made subject to the approval of legal matters by our
counsel, and to the terms and conditions hereof, and may be withdrawn by us at
any time in our discretion.
As compensation for providing the services under this Agreement the
Selected Distributor (and not the Distributor) shall be paid the sales charge
equal to $7 per Unit sold as described in the Prospectus.
All sales will be strictly subject to confirmation and we reserve the
right in our uncontrolled discretion to reject any subscription to purchase any
of the Securities in whole or in part, to accept or reject subscriptions in the
order of their receipt or otherwise, and to allot. You are not authorized to
give any information or make any representation other than as set forth in the
Prospectus in connection with the offer or sale of any of the Securities. No
distributor is authorized to act as agent for the Distributor, or for the
Company, when offering any of the Securities. Nothing contained herein shall
constitute the Selected Distributors partners with us or with one another.
The offer and sale and solicitation of sales of Units by Selected
Distributor shall be made in accordance with, and Selected Distributor shall be
subject to and comply with the
-7-
requirements of, Articles 2 and 3 of the Distribution Agreement. Furthermore,
you agree to comply with all applicable rules of the NASD, including, without
limitation, the Rules of Fair Practice and the NASD Conduct Rules, the
Securities Act of 1933, the Securities Exchange Act of 1934, and all Rules and
Regulations promulgated thereunder.
Payment for Securities sold by you is to be made at our office (or at
such other place as instructed) at the public offering price, on such date as we
may advise, on one day's notice to you, by certified or official bank check in
New York Clearing House funds payable to the Company. Delivery to you of
certificates for the Securities will be made as soon as is practicable
thereafter. Unless specifically authorized by us, payment by you may not be
deferred until delivery of certificates to you. The sales charge payable to you
will be paid as soon as practicable.
This Agreement shall terminate at the close of business on the day
after the effective date of the Registration Statement. We may terminate this
Agreement at any time prior thereto by notice to you. Notwithstanding the
termination of this Agreement, you shall remain liable for your proportionate
share of any transfer tax or any liability which may be asserted or assessed
against us or Selected Distributors based upon the claim that the Distributor
and the Selected Distributors, or any of them, constitute a partnership,
association, unincorporated business or other entity, including in each case
your proportionate share of expenses incurred in defending against any such
claim or liability.
At any time prior to the termination of this Agreement, you will, upon
our request, report to us the number of Securities sold by you under this
Agreement.
We shall have full authority to take such action as we may deem
advisable in respect of all matters pertaining to the offering and the
distribution of Units. We shall be under no liability to you except for our lack
of good faith and for obligations assumed by us in this Agreement, except that
you do not waive any rights that you may have under the Securities Act of 1933
(the "1933 Act") or the rules and regulations thereunder.
Upon application to us, we will inform you of the states and other
jurisdictions of the United States in which it is believed that the Securities
are qualified for sale under, or are exempt from the requirements of, their
respective securities laws, but we assume no responsibility with respect to your
right to sell Securities in any jurisdiction. We have filed a Further State
Notice with respect to the Securities with the Department of State of the State
of New York.
You confirm that you are familiar with Rule 15c2-8 under the Securities
Exchange Act of 1934 (the "1934 Act"), relating to the distribution of
prospectuses, and confirm that you have complied and will comply therewith
(whether or not the Company is subject to the reporting requirements of Section
13 or 15(d) of the 1934 Act). We will make available to you, to the extent made
available to us by the Company such number of copies of the Prospectus as you
may reasonably request for purposes contemplated by the 1933 Act, the 1934 Act,
and the rules and regulations thereunder.
-8-
Your attention is directed to Regulation M under the 1934 Act, which
contains certain prohibitions against trading by a person interested in a
distribution until such person has completed its participation in the
distribution. You confirm that you will at all times comply with the provisions
of such Regulation M in connection with this offering.
Any notice from us shall be deemed to have been duly given if
telephoned, and subsequently mailed or transmitted by any standard form of
written telecommunication to you at the address to which this Agreement is
mailed, or if so mailed or transmitted in the first instance.
Please advise us promptly by telephone or any standard form of written
telecommunication of your intent to participate as a Selected Distributor with
respect to the Securities and confirm your agreement hereto by signing the
Acceptance on the enclosed duplicate hereof and returning promptly such signed
duplicate copy to C.J.M. Planning Corp., 000 Xxxxxxx Xxxxxx, Xxxxxxx Xxxxx, XX
00000.
Upon receipt thereof, this instrument and such signed duplicate copy
will evidence the agreement between us.
Very truly yours,
C.J.M. Planning Corp.
BY:__________________________
Name:
Title:
-9-
C.J.M. Planning Corp.
000 Xxxxxxx Xxxxxx
Xxxxxxx Xxxxx, XX 00000
Dear Sirs:
We hereby agree to participate as a Selected Distributor of the Units
under the terms and conditions of the foregoing Agreement.
We agree to all the terms and conditions stated in the foregoing
Agreement. We acknowledge receipt of the Prospectus relating to the above
Securities and we further state that in entering the foregoing Agreement we have
relied upon said Prospectus and no other statements whatsoever, written or oral.
We affirm that we are either (i) a member in good standing of the National
Association of Securities Dealers, Inc. ( the "NASD") or (ii) a distributor with
its principal place of business located outside the United States, its
territories, or possessions and not registered under the Securities Exchange Act
of 1934 and not eligible for membership in the NASD, who hereby agrees to make
no sales within the United States, its territories or its possessions or to
persons who are nationals thereof or residents therein, and in making any sales,
to comply with the NASD interpretation with respect to free-riding and
withholding, as well as all other pertinent interpretations of the NASD that my
be applicable to us. We also affirm and agree that we will offer Securities sold
by us in conformity with the terms of the offering and in conformity with all
the rules of the NASD, including, without limitation Rules 2730, 2740, 2420,
2750 and 2810 of the NASD Conduct Rules, the Securities Act of 1933, the
Securities Exchange Act of 1934, and the Rules and Regulations promulgated
thereunder.
Date:_____________________, 2000 __________________________________
(Name of Selected Distributor)
By:_______________________________
(Authorized Signature)
Address:___________________________
____________________________________
-10-
