Xxxxxxx Xx. 0
XXXXXXXX XXXXXXXX INSTITUTIONAL SERIES
DISTRIBUTION CONTRACT
CONTRACT made as of ____________________, 1998 between XXXXXXXX XXXXXXXX
INSTITUTIONAL SERIES, a Delaware business trust ("Fund"), and PAINEWEBBER
INCORPORATED, a Delaware corporation ("PaineWebber").
WHEREAS the Fund is registered under the Investment Company Act of l940, as
amended ("l940 Act"), as an open-end management investment company and currently
has one distinct series of shares of beneficial interest ("Series"), which
corresponds to a distinct portfolio and has been designated as Xxxxxxxx Xxxxxxxx
Instituitonal Money Fund,; and
WHEREAS the Fund's board of trustees ("Board") has established an unlimited
number of shares of beneficial interest of the above-referenced Series as
Institutional shares and Financial Intermediary shares ("Shares"); and
WHEREAS the Fund desires to retain PaineWebber as principal distributor in
connection with the offering and sale of the Shares of the above-referenced
Series and of such other Series as may hereafter be designated by the Board and
have Shares established; and
WHEREAS PaineWebber is willing to act as principal distributor of the Shares
of each such Series on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. Appointment. The Fund hereby appoints PaineWebber as its exclusive agent
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to be the principal distributor to sell and to arrange for the sale of the
Shares on the terms and for the period set forth in this Contract. Xxxxxxxx
Xxxxxxxx hereby accepts such appointment and agrees to act hereunder. It is
understood, however, that this appointment does not preclude sales of the Shares
directly through the Fund's transfer agent in the manner set forth in the
Registration Statement. As used in this Contract, the term "Registration
Statement" shall mean the currently effective registration statement of the
Fund, and any supplements thereto, under the Securities Act of 1933, as amended
("1933 Act"), and the 1940 Act.
2. Services and Duties of PaineWebber.
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(a) PaineWebber agrees to sell the Shares on a best efforts basis from
time to time during the term of this Contract as agent for the Fund and upon the
terms described in the Registration Statement.
(b) Upon the later of the date of this Contract or the initial offering
of the Shares by a Series, PaineWebber will hold itself available to receive
purchase orders, satisfactory
to PaineWebber, for Shares of that Series and will accept such orders on behalf
of the Fund as of the time of receipt of such orders and promptly transmit such
orders as are accepted to the Fund's transfer agent. Purchase orders shall be
deemed effective at the time and in the manner set forth in the Registration
Statement.
(c) PaineWebber in its discretion may enter into agreements to sell
Shares to such registered and qualified retail dealers, including but not
limited to Xxxxxxxx Xxxxxxxx Asset Management Inc. ("Xxxxxxxx Xxxxxxxx") as it
may select. In making agreements with such dealers, PaineWebber shall act only
as principal and not as agent for the Fund.
(d) The offering price of the Shares of each Series shall be the net
asset value per Share as next determined by the Fund following receipt of an
order at PaineWebber's principal office. The Fund shall promptly furnish
PaineWebber with a statement of each computation of net asset value.
(e) PaineWebber shall not be obligated to sell any certain number of
Shares.
(f) To facilitate redemption of Shares by shareholders directly or
through dealers, PaineWebber is authorized but not required on behalf of the
Fund to repurchase Shares presented to it by shareholders and dealers at the
price determined in accordance with, and in the manner set forth in, the
Registration Statement.
(g) PaineWebber shall have the right to use any list of shareholders
of the Fund or any other list of investors which it obtains in connection with
its provision of services under this Contract; provided, however, that
PaineWebber shall not sell or knowingly provide such list or lists to any
unaffiliated person.
3. Authorization to Enter into Exclusive Dealer Contracts and to Delegate
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Duties as Distributor. With respect to the Shares of any or all Series,
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PaineWebber may enter into an exclusive dealer agreement with Xxxxxxxx Xxxxxxxx
or any other registered and qualified dealer with respect to sales of the
Shares. In a separate contract or as part of any such exclusive dealer
agreement, PaineWebber also may delegate to Xxxxxxxx Xxxxxxxx or another
registered and qualified dealer ("sub-distributor") any or all of its duties
specified in this Contract, provided that such separate contract or exclusive
dealer agreement imposes on the sub-distributor bound thereby all applicable
duties and conditions to which PaineWebber is subject under this Contract, and
further provided that such separate contract or exclusive dealer agreement meets
all requirements of the 1940 Act and rules thereunder.
4. Services Not Exclusive. The services furnished by PaineWebber hereunder
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are not to be deemed exclusive and PaineWebber shall be free to furnish similar
services to others so long as its services under this Contract are not impaired
thereby. Nothing in this Contract shall limit or restrict the right of any
director, officer or employee of PaineWebber, who may also be a trustee, officer
or employee of the Fund, to engage in any other business or to devote his or her
time and attention in part to the management or other aspects of any other
business, whether of a similar or a dissimilar nature.
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5. Compensation and Reimbursement of Distribution Expenses. The Fund shall
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have no obligation to compensate or reimburse PaineWebber for any services
performed by it hereunder.
6. Duties of the Fund.
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(a) The Fund reserves the right at any time to withdraw offering Shares
of any or all Series by written notice to PaineWebber at its principal office.
(b) The Fund shall determine in its sole discretion whether certificates
shall be issued with respect to the Shares. If the Fund has determined that
certificates shall be issued, the Fund will not cause certificates representing
Shares to be issued unless so requested by shareholders. If such request is
transmitted by PaineWebber, the Fund will cause certificates evidencing Shares
to be issued in such names and denominations as PaineWebber shall from time to
time direct.
(c) The Fund shall keep PaineWebber fully informed of its affairs and
shall make available to PaineWebber copies of all information, financial
statements, and other papers which PaineWebber may reasonably request for use in
connection with the distribution of Shares, including, without limitation,
certified copies of any financial statements prepared for the Fund by its
independent public accountant and such reasonable number of copies of the most
current prospectus, statement of additional information, and annual and interim
reports of any Series as Xxxxxxxx Xxxxxxxx may request, and the Fund shall
cooperate fully in the efforts of PaineWebber to sell and arrange for the sale
of the Shares of the Series and in the performance of PaineWebber under this
Contract.
(d) The Fund shall take, from time to time, all necessary action,
including payment of the related filing fee, as may be necessary to register the
Shares under the 1933 Act to the end that there will be available for sale such
number of Shares as PaineWebber may be expected to sell. The Fund agrees to
file, from time to time, such amendments, reports, and other documents as may be
necessary in order that there will be no untrue statement of a material fact in
the Registration Statement, nor any omission of a material fact which omission
would make the statements therein misleading.
(e) The Fund shall use its best efforts to qualify and maintain the
qualification of an appropriate number of Shares of each Series for sale under
the securities laws of such states or other jurisdictions as PaineWebber and the
Fund may approve, and, if necessary or appropriate in connection therewith, to
qualify and maintain the qualification of the Fund as a broker or dealer in such
jurisdictions; provided that the Fund shall not be required to amend its Trust
Instrument or By-Laws to comply with the laws of any jurisdiction, to maintain
an office in any jurisdiction, to change the terms of the offering of the Shares
in any jurisdiction from the terms set forth in its Registration Statement, to
qualify as a foreign corporation in any jurisdiction, or to consent to service
of process in any jurisdiction other than with respect to claims arising out of
the offering of the Shares. PaineWebber shall furnish such information and other
material relating to its affairs and activities as may be required by the Fund
in connection with such qualifications.
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7. Expenses of the Fund. The Fund shall bear all costs and expenses of
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registering the Shares with the Securities and Exchange Commission and
qualifying the shares with state and other regulatory bodies, and shall assume
expenses related to communications with shareholders of each Series, including
(i) fees and disbursements of its counsel and independent public accountant;
(ii) the preparation, filing and printing of registration statements and/or
prospectuses or statements of additional information required under the federal
securities laws; (iii) the preparation and mailing of annual and interim
reports, prospectuses, statements of additional information and proxy materials
to shareholders; and (iv) the qualifications of Shares for sale and of the Fund
as a broker or dealer under the securities laws of such jurisdictions as shall
be selected by the Fund and PaineWebber pursuant to Paragraph 6(e) hereof, and
the costs and expenses payable to each such jurisdiction for continuing
qualification therein.
8. Expenses of PaineWebber. PaineWebber shall bear all costs and expenses of
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(i) preparing, printing and distributing any materials not prepared by the Fund
and other materials used by PaineWebber in connection with the sale of Shares
under this Contract, including the additional cost of printing copies of
prospectuses, statements of additional information, and annual and interim
shareholder reports other than copies thereof required for distribution to
existing shareholders or for filing with any federal or state securities
authorities; (ii) any expenses of advertising incurred by PaineWebber in
connection with such offering; (iii) the expenses of registration or
qualification of PaineWebber as a broker or dealer under federal or state laws
and the expenses of continuing such registration or qualification; and (iv) all
compensation paid to PaineWebber's employees and others for selling Shares, and
all expenses of PaineWebber, its employees and others who engage in or support
the sale of Shares as may be incurred in connection with their sales efforts.
9. Indemnification.
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(a) The Fund agrees to indemnify, defend and hold PaineWebber, its
officers and directors, and any person who controls PaineWebber within the
meaning of Section 15 of the 1933 Act, free and harmless from and against any
and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which PaineWebber, its officers,
directors or any such controlling person may incur under the 1933 Act, or under
common law or otherwise, arising out of or based upon any alleged untrue
statement of a material fact contained in the Registration Statement or arising
out of or based upon any alleged omission to state a material fact required to
be stated in the Registration Statement or necessary to make the statements
therein not misleading, except insofar as such claims, demands, liabilities or
expenses arise out of or are based upon any such untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with information furnished in writing by PaineWebber to the Fund for use in the
Registration Statement; provided, however, that this indemnity agreement shall
not inure to the benefit of any person who is also an officer or trustee of the
Fund or who controls the Fund within the meaning of Section 15 of the 1933 Act,
unless a court of competent jurisdiction shall determine, or it shall have been
determined by controlling precedent, that such result would not be against
public policy as expressed in the 1933 Act; and further provided, that in no
event shall anything contained herein be so construed as to protect
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PaineWebber against any liability to the Fund or to the shareholders of any
Series to which PaineWebber 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 under this Contract. The
Fund shall not be liable to PaineWebber under this indemnity agreement with
respect to any claim made against PaineWebber or any person indemnified unless
PaineWebber or other such 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 PaineWebber or such other person (or after PaineWebber 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 it may have to PaineWebber or any person against whom such action is
brought otherwise than on account of this indemnity agreement. 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 agreement. 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
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 PaineWebber promptly 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 its Shares.
(b) PaineWebber agrees to indemnify, defend, and hold the Fund, its
officers and trustees, and any person who controls the Fund within the meaning
of Section 15 of the 1933 Act, free and harmless from and against any and all
claims, demands, liabilities and expenses (including the cost of investigating
or defending against such claims, demands or liabilities and any counsel fees
incurred in connection therewith) which the Fund, its trustees or officers, or
any such controlling person may incur under the 1933 Act or under common law or
otherwise arising out of or based upon any alleged untrue statement of a
material fact contained in information furnished in writing by PaineWebber to
the Fund for use in the Registration Statement, arising out of or based upon any
alleged omission to state a material fact in connection with such information
required to be stated in the Registration Statement necessary to make such
information not misleading, or arising out of any agreement between PaineWebber
and any retail dealer, or arising out of any supplemental sales literature or
advertising used by PaineWebber in connection with its duties under this
Contract. PaineWebber 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 PaineWebber elects to assume the defense, the defense
shall be conducted by counsel chosen by PaineWebber and satisfactory to the
indemnified defendants whose approval shall not be unreasonably withheld. In the
event that PaineWebber 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 PaineWebber 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.
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10. Limitation of Liability of the Trustees and Shareholders of the Fund.
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The trustees of the Fund and the shareholders of any Series shall not be liable
for any obligations of the Fund or any Series under this Contract, and
PaineWebber agrees that, in asserting any rights or claims under this Contract,
it shall look only to the assets and property of the Fund or the particular
Series in settlement of such right or claims, and not to such trustees or
shareholders.
11. Services Provided to the Fund by Employees of PaineWebber. Any person,
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even though also an officer, director, employee or agent of PaineWebber, who may
be or become an officer, trustee, employee or agent of the Fund, shall be
deemed, when rendering services to the Fund or acting in any business of the
Fund, to be rendering such services to or acting solely for the Fund and not as
an officer, director, employee or agent or one under the control or direction of
PaineWebber even though paid by PaineWebber.
12. Duration and Termination.
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(a) This Contract shall become effective upon the date written above,
provided that, with respect to any Series, this Contract shall not take effect
with respect to a class of Shares of that Series unless such action has first
been approved by vote of a majority of the Board and by vote of a majority of
those trustees of the Fund who are not interested persons of the Fund, and have
no direct or indirect financial interest in this Contract or in any agreements
related thereto (all such Trustees collectively being referred to herein as the
"Independent Trustees"), cast in person at a meeting called for the purpose of
voting on such action.
(b) Unless sooner terminated as provided herein, this Contract shall
continue in effect for one year from the above written date. Thereafter, if not
terminated, this Contract shall continue automatically for successive periods of
twelve months each, provided that such continuance is specifically approved at
least annually (i) by a vote of a majority of the Independent Trustees, cast in
person at a meeting called for the purpose of voting on such approval, and (ii)
by the Board or with respect to a class of Shares of any given Series by vote of
a majority of the outstanding voting securities of the that class of Shares of
such Series.
(c) Notwithstanding the foregoing, with respect to a class of Shares
of any Series, this Contract may be terminated at any time, without the payment
of any penalty, by vote of the Board, by vote of a majority of the Independent
Trustees or by vote of a majority of the outstanding voting securities of that
class of Shares of such Series on sixty days' written notice to PaineWebber or
by PaineWebber at any time, without the payment of any penalty, on sixty days'
written notice to the Fund or such Series. This Contract will automatically
terminate in the event of its assignment.
(d) Termination of this Contract with respect to any given Series or
class of Shares of a Series shall in no way affect the continued validity of
this Contract or the performance thereunder with respect to any other Series or
class of Shares.
13. Amendment of this Contract. No provision of this Contract may be
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changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
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14. Governing Law. This Contract shall be construed in accordance with the
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laws of the State of Delaware and the 1940 Act. To the extent that the
applicable laws of the State of Delaware conflict with the applicable provisions
of the l940 Act, the latter shall control.
15. Notice. Any notice required or permitted to be given by either party to
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the other shall be deemed sufficient upon receipt in writing at the other
party's principal offices.
16. Miscellaneous. The captions in this Contract are included for
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convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Contract shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Contract shall not be affected
thereby. This Contract shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors. As used in this Contract,
the terms "majority of the outstanding voting securities," "interested person"
and "assignment" shall have the same meaning as such terms have in the l940 Act.
IN WITNESS WHEREOF, the parties hereto have caused this Contract to be
executed by their officers designated as of the day and year first above
written.
ATTEST: XXXXXXXX XXXXXXXX INSTITUTIONAL SERIES
By:
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ATTEST: PAINEWEBBER INCORPORATED
By:
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