AMENDMENT TO DISTRIBUTION AGREEMENT
December 1, 2005
Citigroup Global Markets Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Dear Sirs:
Reference is made to that certain distribution agreement (the
"Agreement"), dated as of June 5, 2000, between Xxxxx Xxxxxx
Investment Funds Inc. (the "Investment Company"), with respect
to one or more separate series listed on Exhibit A (each a
"Fund") and Citigroup Global Markets Inc. This letter agreement
(the "Amendment") amends or supplements certain terms of the
Agreement as set forth below. Except as expressly amended
hereby, the provisions of the Agreement are and shall remain
in full force and effect. Capitalized terms not defined in
this Amendment shall have the meanings given to them in the
Agreement.
We acknowledge that Xxxx Xxxxx Inc. ("Xxxx Xxxxx") and Citigroup
Inc. ("Citigroup") have entered into that certain Amended and
Restated Global Distribution Agreement (the "Global Distribution
Agreement"), dated as of October 3, 2005, which provides, for a
period of three years from December 1, 2005, for the distribution
by Citigroup distributors of Citigroup investment products and
Xxxx Xxxxx investment products within the United States and
internationally and for Citigroup's access to certain Xxxx Xxxxx
investment products pursuant to the terms of the Global Distribution
Agreement.
1. Services as a Non-Exclusive Principal Underwriter and Distributor
Notwithstanding anything to the contrary contained
in the Agreement:
1.1 You shall be, for the period of the Agreement as amended by
this Amendment, a non-exclusive principal underwriter and distributor
of the Fund.
1.2 You may perform any services for any entity, including investment
companies that are not advised or administered by Citigroup or its
subsidiaries.
1.3 You shall retain all rights to the information of your customers,
including, but not limited to, the names, addresses, telephone numbers
and social security numbers of applicants for, purchasers of, and other
customers of the Fund as well as other identity and private information
in respect of your customers, employees, registered representatives
and agents ("Confidential Information"); provided, however, that
Confidential Information shall not include any customer information
that: (x) was previously known by us from a source other than you
without obligations of confidence; (y) was or is rightfully received
by us from a third party without obligations of confidence to you or
from publicly available sources without obligations of confidence to
you; or (z) was or is developed by means independent of information
obtained from you.
2. Termination
In addition to the termination rights already contained in the Agreement,
(i) at any time prior to the second anniversary hereof, at your option
you may terminate the Agreement at any time in order for you to enter
into a mutually satisfactory mutual fund dealer agreement with the
principal underwriter that is an affiliate of Xxxx Xxxxx for the
Investment Company (a "Dealer Agreement") and (ii) at any time
following the second anniversary of the date hereof, either party may
at its option terminate the Agreement at any time in order for you to
enter into a Dealer Agreement ; provided, that any such termination
shall only be effective upon execution and delivery of a Dealer Agreement
which shall be, unless the parties thereto otherwise agree, in
substantially the form presented to the Board of the Investment Company
and attached hereto as Exhibit B with such additional changes as may be
appropriate to reflect changes in applicable laws, regulations or
industry practice.
3. Dealer and Other Agreements
You may not enter into dealer or similar agreements with unaffiliated
brokers, dealers, banks or other similar firms or recordkeeping,
shareholder servicing and sub-accounting services with unaffiliated
intermediaries without the written consent of the Investment Company or
its authorized designee. No such unaffiliated intermediary is authorized
to act as agent for the Investment Company in connection with the offering
or sale of Shares of the Fund to the public or otherwise, except for the
limited purpose of determining the time as of which transactions in Shares
are deemed to have been received.
4. Compliance Matters
(a) You shall act as a distributor and principal
underwriter of Shares in compliance in all material respects with all
applicable laws, rules and regulations, including, without limitation,
all rules and regulations made or adopted pursuant to (i) the 1940 Act,
(ii) the Securities Exchange Act of 1934 ("1934 Act"), (iii) any securities
association registered under the 1934 Act, including without limitation
the NASD Conduct Rules or rules of any other applicable self-regulatory
organization. You shall offer the Shares, and accept purchases,
redemptions and exchanges for Shares, in compliance with the Fund's
registration statement (including its prospectus and statement of
additional information), as it may be amended or supplemented from
time to time ("Registration Statement"). You will comply with and
abide by the terms of a Fund's Plan, as it may be amended from time
to time.
(b) You agree to submit sales literature and
marketing materials (including memorandums, bulletins, and/or information
or related materials) intended for public distribution ("CGMI Marketing
Materials") to the co-principal underwriter of the Investment Company
which is an affiliate of Xxxx Xxxxx prior to distribution or publication
for written approval. Such CGMI Marketing Materials shall be submitted
15 days in advance for review. You shall be responsible for reviewing
and making such filings with the NASD, as required, of CGMI Marketing
Materials relating to each Fund.
(c) You shall adopt and follow procedures for the
confirmation of sales to investors and qualified securities dealers,
banks and other intermediaries (collectively "Intermediaries") timeliness
of orders, the collection of amounts payable by investors and
Intermediaries on such sales, the correction of errors related to
distribution of Shares, the cancellation of unsettled transactions,
and assisting with the solicitation of proxies, and any other matters
governed by Rule 38a-1 under the 1940 Act (as may apply to a distributor
or principal underwriter for a registered investment company), each as
may be necessary to comply with the requirements of the NASD, any other
self-regulatory organization, and the federal securities laws. You shall
provide reports or other information to the Investment Company at the
Investment Company's reasonable request, including, without limitation,
reports related to the operation and implementation of the Investment
Company's policies related to customer privacy, safeguarding of customer
information, anti-money-laundering, sales and marketing practices, the
operation of your code of ethics or other policies and procedures of the
Investment Company.
(d) You represent, warrant and agree that you have adopted
and implemented: (i) an anti-money-laundering program in compliance with
the USA Patriot Act of 2001, the regulations thereunder and NASD Conduct
Rules, including, without limitation, customer identification program
procedures, monitoring for suspicious activity, and (ii) procedures to
comply with applicable law and regulation related to cash transaction
reporting requirements, as well as monitoring and reporting under FinCEN,
OFAC and other government watch lists.
(e) The Investment Company agrees that the information
exchanged under the Agreement and information about the respective
customers and potential customers of each is confidential and as such
shall not be disclosed by the Fund, sold or used by the Fund in any way
except to carry out the terms of this Agreement. Notwithstanding the
foregoing, such customer information may be disclosed by the Investment
Company on a "need to know" basis as set forth in applicable privacy
rules and regulations. The obligations regarding confidentiality hereunder
shall not apply to any information which is (i) otherwise publicly
available, (ii) already possessed by the entity to whom the information
was disclosed prior to disclosure hereunder, (iii) independently developed
by the entity, or (iv) disclosed pursuant to law, rule, regulation or
court or administrative order. The Investment Company 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 Agreement, provided that such use is consistent with applicable
law and your privacy policies of the Investment Company, including the
provision of information to the Fund's transfer agent or to agents used
for the solicitation of proxies. You agree that you will comply with
all of the foregoing obligations of this to the extent that information
is treated as customer information of the Fund under applicable law or
regulation, including without limitation Regulation S-P. Each party
further agrees to take commercially reasonable steps, in accordance with
applicable law, to safeguard customer information. The provisions of
this paragraph will survive termination of the Agreement.
(f) From time to time, each Fund may implement policies,
procedures or charges in an effort to avoid the potential adverse effects
on the Fund of short-term trading by market timers. You agree to provide
other assistance reasonably designed to achieve compliance with these
policies. You will maintain and enforce policies with respect to frequent
trading and share redemption as are reasonable and customary in the industry.
To the extent that accounts are held in street name, you agree to cooperate
with the Investment Company and the Investment Company's Chief Compliance
Officer (including, to the extent practicable, providing account level
sales and redemption information) to assist in compliance with the frequent
trading and redemption fee provisions as set forth in the Fund's prospectus
and other policies set forth in the Fund's Registration Statement.
(g) Purchases, exchanges and redemptions of Shares through you
will be at the public offering price of such Shares (the net asset value of
the Shares, with appropriate adjustments for any applicable sales charge),
as determined in accordance with the then effective Registration Statement
used in connection with the offer and sale of the Shares. The public
offering price will reflect scheduled variations in or the elimination of
sales charges on sales of Shares either generally to the public or in
connection with special purchase plans, as described in the Registration
Statement. You agree to apply any scheduled variation in or waivers of
sales charges uniformly to all customers meeting the qualifications therefor
as specified in the Registration Statement. With respect to Funds sold with
an initial sales charge, your customers will be entitled to reduced sales
charges on purchases made under any letter of intent or right of accumulation
as described in the Registration Statement.. In such case, the concession
from the public offering price retained by you will be based upon such
reduced sales charge. When placing wire trades, your agree to advise the
Funds of any letter of intent executed by its customer or any available
right of accumulation. The minimum initial purchase and the minimum
subsequent purchase of any Shares shall be as set forth in the applicable
Registration Statement. All orders are subject to acceptance or rejection
by the applicable Fund in its sole discretion for any reason.
(h) The handling and settlement of purchase, exchange and
redemption orders will be subject to the provisions of the Registration
Statement and such further procedures as the Investment Company and you
may determine to be appropriate from time-to-time, consistent with this
Amendment. Citigroup Global Markets' internal systems are suitably
designed to handle such orders. Each Fund shall notify you of the states
or jurisdictions in which its Shares are currently available for sale to
the public. The Investment Company shall have no obligation to register
or make available Fund shares in any state or jurisdiction. You will be
responsible for the accuracy, timeliness and completeness of purchase,
redemption or exchange orders accepted by you.
(j) The Investment Company acknowledges that the co-principal
underwriter which is affiliated with Xxxx Xxxxx shall be responsible for
reviewing the Registration Statement of the Fund for the accuracy and
completeness of all disclosure concerning the distribution of Shares and
that you shall not have such responsibility, except, in each case, to the
extent the disclosure information is provided by you or pertains to
information concerning your operations. Notwithstanding the foregoing,
nothing in this paragraph shall alter your responsibilities for complying
with the terms of the Registration Statement in your offering of Shares.
5. Records. Upon the Investment Company's reasonable request, you
will provide access to or make copies of any such records the Investment
Company does not possess in order to: (a) comply with a request from a
government body or self-regulatory organization; (b) verify compliance
by the other party of the terms of this Agreement; or (c) make required
regulatory reports.
6. Section 9 of the 1940 Act. You agree to promptly notify the
Investment Company should you cease to be a member of the NASD through
expulsion or otherwise or if its membership is suspended or should you
be subject to any limitations on your conduct under Section 9 of the 1940 Act.
7. Indemnification
You agree to indemnify, defend and hold the Investment Company, its several
officers and Board members, and any person who controls the Investment
Company 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
the Investment Company, its officers or Board members, or any such
controlling person may incur, under the 1933 Act or under common law or
otherwise, on account of any act of yours or any of your employees
constituting willful misfeasance, bad faith, or gross negligence in the
performance of its duties, or by reason of your reckless disregard of your
obligations and duties under the Agreement or this Amendment. The foregoing
indemnification provisions supplement the indemnification provisions of the
Agreement. The indemnifications provisions of this Amendment and the
Agreement shall survive the termination of the Agreement and/or this Amendment.
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance of this Amendment by signing and returning to us the enclosed
copy, whereupon this Amendment will become binding on you.
Very truly yours,
Xxxxx Xxxxxx Investment Funds Inc.
By: _______________________
Name: R. Xxx Xxxxxx
Title: Chief Executive Officer
Agreed to as of the date first above written:
Citigroup Global Markets Inc.
By: _____________________________
Name:
Title:
EXHIBIT A
Fund Date Added:
Xxxxx Xxxxxx Investment Grade Bond Fund December 1, 2005
Xxxxx Xxxxxx Multiple Discipline Funds - Balanced All Cap Growth and Value Fund
December 1, 2005
Xxxxx Xxxxxx Multiple Discipline Funds - Large Cap Growth and Value Fund
December 1, 2005
Xxxxx Xxxxxx Multiple Discipline Funds - All Cap Growth and Value Fund
December 1, 2005
Xxxxx Xxxxxx Multiple Discipline Funds - Global All Cap Growth and Value Fund
December 1, 2005
Xxxxx Xxxxxx Multiple Discipline Funds - All Cap and International Fund D
ecember 1, 2005
Xxxxx Xxxxxx Government Securities Fund December 1, 2005
Xxxxx Xxxxxx Xxxxxxxxxx Global Value Fund December 1, 2005
Xxxxx Xxxxxx Real Return Strategy Fund December 1, 2005
Xxxxx Xxxxxx Small Cap Growth Fund December 1, 2005
Xxxxx Xxxxxx Small Cap Value Fund December 1, 2005
EXHIBIT B
DEALER AGREEMENT
