EXHIBIT E(1)
DISTRIBUTION AGREEMENT
This Distribution Agreement is made as of this 11 day of
November 2005, between Xxxxx Treasury Only Money Market Fund, a Massachusetts
business trust (herein called the "Trust"), and Xxxxx Capital Securities, Inc.,
a Florida corporation (herein called the "Distributor").
WHEREAS, the Trust is an open-end management investment
company and is so registered under the Investment Company Act of 1940; and
WHEREAS, the Trust desires to retain the Distributor as
Distributor for the Xxxxx Treasury Only Money Market Fund, together with all
other portfolios, if any, subsequently established by the Trust (individually
known as a "Fund" and collectively "Funds") -- to provide for the sale and
distribution of shares of beneficial interest of the Funds, each such share
having a par value of $.001 (herein collectively called "Shares"), and the
Distributor is willing to render such services;
NOW THEREFORE, in consideration of premises and mutual
covenants set forth herein the parties hereto agree as follows:
1. Delivery of Documents. The Trust has delivered to the Distributor copies of
each of the following documents and will deliver to it all future amendments and
supplements thereto, if any:
(a) The Trust's Agreement and Declaration of Trust and all
amendments thereto (such Agreement and Declaration of Trust, as presently in
effect and as it shall from time to time be amended, herein called the "Trust's
Declaration");
(b) The By-Laws of the Trust (such By-Laws, as presently in
effect and as they shall from time to time be amended, herein called the
"By-Laws");
(c) Resolutions of the Board of Trustees of the Trust
authorizing the execution and delivery of this Agreement;
(d) The Trust's Registration Statement under the Securities
Act of 1933, as amended (the "1933 Act"), and the Investment Company Act of
1940, as amended (the "1940 Act"), on Form N-1A as filed with the Securities and
Exchange Commission (the "Commission") on August 10, 1995 and all subsequent
amendments thereto (said Registration Statement, as presently in effect and as
amended or supplemented from time to time, is herein called the "Registration
Statement");
(e) Notification of Registration of the Trust under the 1940
Act on Form N-8A as filed with the Commission; and
(f) Prospectuses and Statements of Additional Information of
the Funds (such prospectuses and statements of additional information, as
presently filed with the Securities and Exchange Commission and as they shall
from time to time be amended and supplemented, herein called individually the
"Prospectus" and collectively the "Prospectuses").
2. Registration and Sale of Additional Shares. The Trust will from time to time
use its best efforts to register under the 1933 Act such number of Shares not
already registered as the Distributor may reasonably be expected to sell on
behalf of the Trust. The Trust and the Distributor will cooperate in taking such
action as may be necessary from time to time to qualify Shares so registered for
sale by the Trust or the Distributor in any states mutually agreeable to the
Trust and the Distributor, and to maintain such qualification. This Agreement
relates to the issue and sale of Shares that are duly authorized and registered
and available for sale by the Trust, including redeemed or repurchased Shares if
and to the extent that they may be legally sold and if, but only if, the Trust
sees fit to sell them.
3. Sale of Shares. Subject to the provisions of paragraphs 5 and 7 hereof and to
such minimum purchase requirements as may from time to time be currently
indicated in the Trust's prospectus or statement of additional information, the
Distributor is authorized to sell as agent on behalf of the Trust Shares
authorized for issue and as agent on behalf of the Trust Shares authorized for
issue and registered under the 1933 Act. The Distributor may also purchase as
principal Shares for resale to the public. Such sales will be made by the
Distributor on behalf of the Trust by accepting unconditional orders to purchase
Shares placed with the Distributor by investors and such purchases will be made
by the Distributor after its acceptance of such orders. The sales price to the
public of Shares shall be the public offering price as defined in paragraph 6
hereof.
4. Solicitation of Orders. The Distributor will use its best efforts (but only
in states in which it may lawfully do so) to obtain from investors unconditional
orders for Shares authorized for issue by the Trust and registered under the
1933 Act, provided that the Distributor may in its discretion refuse to accept
orders for Shares from any particular applicant.
5. Sale of Shares by the Trust. Unless the Distributor is otherwise notified by
the Trust, any right granted to the Distributor to accept orders for Shares or
to make sales on behalf of the Trust or to purchase Shares for resale will not
apply to (i) Shares issued in connection with the merger or consolidation of any
other investment company with the Trust or its acquisition, by purchase or
otherwise, of all or substantially all of the assets of any investment company
or substantially all of the outstanding shares of any such company, and (ii) to
Shares that may be offered by the Trust to shareholders of the Trust by virtue
of their being shareholders.
6. Public Offering Price. All Shares sold to investors by the Distributor will
be sold at the public offering price . The public offering price for all
accepted subscriptions will be the net asset value per Share, determined, in the
manner provided in the Trust's registration statements as from time to time in
effect under the 1933 Act and the 1940 Act, next after the order is accepted by
the Distributor.
7. Suspension of Sales. If and whenever the determination of net asset value is
suspended and until such suspension is terminated, the Distributor shall not
accept further orders for Shares except unconditional orders placed with the
Distributor before it had knowledge of the suspension. In addition, the Trust
reserves the right to suspend sales and the Distributor's authority to accept
orders for Shares on behalf of the Trust if, in the judgment of a majority of
the Board of Trustees or a majority of the Executive Committee of such Board, if
such body exists, it is in the best interests of the Trust to do so, such
suspension to continue for such period as may be determined by such majority;
and in that event, no Shares will be sold by the Distributor on behalf of the
Trust while such suspension remains in effect except for Shares necessary to
cover unconditional orders accepted by the Distributor before it had knowledge
of the suspension.
8. Portfolio Securities. Portfolio securities of any Portfolio of the Trust may
be bought or sold by or through the Distributor and the Distributor may
participate directly or indirectly in brokerage commissions or "spread" in
respect to transactions in portfolio securities of any Portfolio of the Trust;
provided, however, that all sums of money received by the Distributor as a
result of such purchases and sales or as a result of such participation must,
after reimbursement of its actual expenses in connection with such activity, be
paid over by the Distributor to or for the benefit of the Trust.
9. Expenses. (a) The Trust will pay (or will enter into arrangements providing
that others than the Distributor will pay) all fees and expenses:
(1) in connection with the preparation, setting in type and filing
of any registration statement (including a prospectus and
statement of additional information) under the 1933 Act or the
1940 Act, or both, and any amendments or supplements thereto
that may be made from time to time;
(2) in connection with the registration and qualification of
Shares for sale in the various jurisdictions in which the
Trust shall determine it advisable to qualify such Shares for
sale (including registering the Trust as a broker or dealer or
any officer of the Trust or other person as agent or salesman
of the Trust in any such jurisdictions);
(3) of preparing, setting in type, printing and mailing any
notice, proxy statement, report, prospectus or other
communication to shareholders of the Trust in their capacity
as such;
(4) of preparing, setting in type, printing and mailing
prospectuses annually, and any supplements thereto, to
existing shareholders;
(5) in connection with the issue and transfer of Shares resulting
from the acceptance by the Distributor of orders to purchase
Shares placed with the Distributor by investors, including the
expenses of printing and mailing confirmations of such
purchase orders and the expenses of printing and mailing a
prospectus included with the confirmation of such orders;
(6) of any issue taxes or any initial transfer taxes;
(7) of WATS (or equivalent) telephone lines other than the portion
allocated to the Distributor in this paragraph 9;
(8) of wiring funds in payment of Share purchases or in
satisfaction of redemption or repurchase requests, unless such
expenses are paid for by the investor or shareholder who
initiates the transaction;
(9) of the cost of printing and postage of business reply
envelopes sent to Trust shareholders;
(10) of one or more CRT terminals connected with the compute
facilities of the transfer agent other than the portion
allocated to the Distributor in this paragraph 9;
(11) permitted to be paid or assumed by the Trust pursuant to a
plan ("12b-1 Plan"), if any, adopted by the Trust in
conformity with the requirements of Rule 12b-1 under the 1940
Act ("Rule 12b-1") or any successor rule, notwithstanding any
other provision to the contrary herein;
(12) of the expense of setting in type, printing and postage of a
periodic newsletter to shareholders other than the portion
allocated to the Distributor in this paragraph 9; and
(13) of the salaries and overhead of persons employed by the
Distributor as shareholder representatives other than the
portion allocated to the Distributor in this paragraph 9.
b) The Distributor shall pay or arrange for the payment of all fees and
expenses:
(1) of printing and distributing any prospectuses or reports
prepared for its use in connection with the offering of Shares
to the public;
(2) of preparing, setting in type, printing and mailing any other
literature used by it in connection with the offering of
Shares to the public;
(3) of advertising in connection with the offering of Shares to
the public;
(4) incurred in connection with its registration as a broker or
dealer or the registration or qualification of its officers,
trustees, agents, or representatives under federal and state
laws;
(5) of that portion of WATS (or equivalent) telephone lines,
allocated to it on the basis of use by investors (but not
shareholders) who request information or prospectuses;
(6) of that portion of the expenses of setting in type, printing
and postage of a periodic newsletter to shareholders
attributable to promotional material included in such
newsletter at the Distributor's request concerning investment
companies other than the Trust or concerning the Trust to the
extent it is required to assume the expense thereof pursuant
to paragraph 9(b)(8), except such material which is limited to
information, such as listings of other investment companies
and their investment objectives, given in connection with the
exchange privilege as from time to time described in the
Trust's prospectus;
(7) of that portion of the salaries and overhead of persons
employed by it as shareholder representatives attributable to
the time spent by such persons in responding to requests from
investors, but not shareholders, for information about the
Trust;
(8) of any activity which is primarily intended to result in the
sale of Shares, unless a 12b-1 Plan shall be in effect which
provides that the Trust shall bear some or all of such
expenses, in which case the Trust shall bear such expenses in
accordance with such Plan; and
(9) of that portion of one or more CRT terminals connected with
the computer facilities of the transfer agent attributable to
its use of such terminal(s) to gain access to such of the
transfer agent's records as also serve as its records.
Expenses which are to be allocated between the Distributor and the
Trust shall be allocated pursuant to reasonable procedures or formulae mutually
agreed upon from time to time, which procedures or formulae shall to the extent
practicable reflect studies of relevant empirical data.
10. Conformity with Law. The Distributor agrees that in selling Shares it will
duly conform in all respects with the laws of the United States and any state in
which Shares may be offered for sale by it pursuant to this Agreement and to the
rules and regulations of the National Association of Securities Dealers, Inc.,
of which the Distributor is a member.
11. Independent Contractor. The Distributor shall be an independent contractor
and neither the Distributor nor any of its officers or employees is or shall be
an employee of the Trust in the performance of its duties hereunder. The
Distributor shall be responsible for its own conduct and the employment, control
and conduct of its agents and employees and for injury to such agents or
employees or to others through its agents or employees. The Distributor shall
assume full responsibility for its agents and employees under applicable
statutes and agree to pay all employee taxes thereunder.
12. Indemnification. The Distributor agrees to indemnify and hold harmless the
Trust and each of its Trustees and officers and each person, if any, who
controls the Trust within the meaning of Section 15 of the 1933 Act, against any
and all losses, claims, damages, liabilities or litigation (including legal and
other expenses) to which the Trust or such Trustees, officers, or controlling
person may become subject under such Act, under any other statute, at common law
or otherwise, arising out of the acquisition of any Shares by any person which
(i) may be based upon any wrongful act by the Distributor or any of its
employees or representatives, or (ii) may be based upon any untrue statement or
alleged untrue statement of a material fact contained in a registration
statement (including a prospectus or statement of additional information)
covering Shares or any amendment thereof or supplement thereto or the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statement therein not misleading if such
statement or omission was made in reliance upon information furnished to the
Trust by the Distributor, or (iii) may be incurred or arise by reason of its
acting as the Trust's agent instead of purchasing and reselling Shares as
principal in distributing the Shares to the public, provided, however, that in
no case (i) is its indemnity in favor of a trustee or officer or any other
person deemed to protect such trustee or officer or other person against any
liability to which any such person would otherwise be subject by reason of
willful misfeasance, bad faith, or gross negligence in the performance of his
duties or by reason of his reckless disregard of obligations and duties under
this Agreement or (ii) is the Distributor to be liable under its indemnity
agreement contained in this paragraph with respect to any claim made against the
Trust or any person indemnified unless the Trust or such person, as the case may
be, shall have notified the Distributor in writing within a reasonable time
after the summons or other first legal process giving information of the nature
of the claims shall have been served upon the Trust or upon such person (or
after the Trust 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 Trust or any person
against whom such action is brought otherwise than on account of its indemnity
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 any such liability, but if it elects
to assume the defense, such defense shall be conducted by counsel chosen by it
and satisfactory to the Trust, to its officers and Trustees, or to any
controlling person or persons, defendant or defendants in the suit. In the event
that the Distributor elects to assume the defense of any such suit and retain
such counsel, the Trust, such officers and 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 Distributor does not
elect to assume the defense of any such suit, it will reimburse the Trust, 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 Distributor agrees promptly to notify the Trust of the commencement of
any litigation or proceedings against it in connection with the issue and sale
of any Shares.
The Trust agrees to indemnify and hold harmless the Distributor and
each of its trustees and officers and each person, (if any, who controls the
Distributor within the meaning of Section 15 of the 1933 Act, against any and
all losses, claims, damages, liabilities or litigation (including legal and
other expenses) to which the Distributor or such trustees, officers or
controlling person may become subject under such Act, under any other statute,
at common law or otherwise, arising out of the acquisition of any Shares by any
person which (i) may be based upon any wrongful act by the Trust or any of its
employees or representatives, or (ii) may be based upon any untrue statement or
alleged untrue statement of a material fact contained in a registration
statement (including a prospectus or statement of additional information)
covering Shares or any amendment thereof or supplement thereto or the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading if such
statement or omission was made in reliance upon information furnished to the
Distributor by the Trust; provided, however, that in no case (i) is the Trust's
indemnity in favor of a trustee or officer or any other person deemed to protect
such trustee or officer or other person against any liability to which any such
person would otherwise be subject by reason of willful misfeasance, bad faith,
or gross negligence in the performance of his duties or by reason of his
reckless disregard of obligations and duties under this Agreement or (ii) is the
Trust to be liable under its indemnity agreement contained in this paragraph
with respect to any claims made against the Distributor or any such trustee,
officer or controlling person unless the Distributor or such trustee, officer or
controlling person, as the case may be, shall have notified the Trust 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
Distributor or upon such trustee, officer or controlling person (or after the
Distributor or such trustee, officer or controlling person shall have received
notice of such service on any designated agent), but failure to notify the Trust
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 Trust 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 Trust
elects to assume the defense, such defense shall be conducted by counsel chosen
by it and satisfactory to the Distributor, its trustees, officers, or
controlling person or persons, defendant or defendants in the suit. In the event
that the Trust elects to assume the defense of any such suit and retain such
counsel, the Distributor, its trustees, officers 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 Trust does not
elect to assume the defense of any such suit, it will reimburse the Distributor
or such trustees, officers or controlling person or persons, defendant or
defendants in the suit, for the reasonable fees and expenses of any counsel
retained by them. The Trust agrees promptly to notify the Distributor 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 Shares.
13. Authorized Representations. The Trust is not authorized to give any
information or to make any representations on behalf of the Distributor other
than the information and representations contained in a registration statement
(including a prospectus or statement of additional information) covering Shares,
as such registration statement and prospectus may be amended or supplemented
from time to time.
The Distributor is not authorized to give any information or to make
any representations on behalf of the Trust or in connection with the sale of
Shares other than the information and representations contained in a
registration statement (including a prospectus or statement of additional
information) covering Shares, as such registration statement may be amended or
supplemented from time to time. No person other than the Distributor is
authorized to act as principal underwriter (as such term is defined in the 0000
Xxx) for the Trust.
14. Duration and Termination of this Agreement. This Agreement shall become
effective upon the date first written above and will remain in effect until
November , 2005 and from year to year thereafter, but only so long as such
continuance is specifically approved at least annually by the vote of a majority
of the trustees who are not interested persons of the Distributor or of the
Trust, cast in person at a meeting called for the purpose of voting on such
approval, and by vote of the Board of Trustees or of a majority of the
outstanding voting securities of the Trust. This Agreement may, on 60 days'
written notice, be terminated at any time without the payment of any penalty, by
the Board of Trustees of the Trust, by a vote of a majority of the outstanding
voting securities of the Trust, or by the Distributor. This Agreement will
automatically terminate in the event of its assignment. In interpreting the
provisions of this paragraph 14, the definitions contained in Section 2(a) of
the 1940 Act (particularly the definitions of "interested person", "assignment"
and "majority of the outstanding voting securities"), as modified by any
applicable order of the Securities and Exchange Commission, shall be applied.
15. Amendment of this Agreement. No provisions of this Agreement may be 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. If the Trust should at any time deem it necessary or
advisable in the best interests of the Trust 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 advantage under state or federal tax laws and should notify the
Distributor of the form of such amendment, and the reasons therefor, and if the
Distributor should decline to assent to such amendment, the Trust may terminate
this Agreement forthwith. If the Distributor should at any time request that a
change be made in the Trust's Declaration of Trust or By-laws or in its methods
of doing business, in order to comply with any requirements of federal law or
regulations of the Securities and Exchange Commission or of a national
securities association of which the Distributor is or may be a member relating
to the sale of shares of the Trust, and the Trust should not make such necessary
change within a reasonable time, the Distributor may terminate this Agreement
forthwith.
16. Termination of Prior Agreements. This Agreement upon its effectiveness
terminates and supersedes all prior underwriting contracts between parties.
17. Miscellaneous. The captions in this Agreement are included for 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
Agreement shall be held or made invalid by a court decision, statute, rule or
otherwise, the remainder of this Agreement shall not be affected thereby.
Subject to the provisions of Section VI hereof, this Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and shall be governed by Massachusetts law; provided, however, that
nothing herein shall be construed in a manner inconsistent with the 1940 Act or
any rule or regulation of the Commission thereunder.
18. Massachusetts Business Trust. The Trust is organized as a Massachusetts
business trust, and references in this Agreement to the Trust mean and refer to
the Trustees from time to time serving under its Declaration of Trust on file
with the Secretary of State of the Commonwealth of Massachusetts, as the same
may be amended from time to time, pursuant to which the Trust conducts its
business. It is expressly agreed that the obligations of the Trust hereunder
shall not be binding upon any of the Trustees, shareholders, nominees, officers,
agents or employees of the Trust, as provided in said Declaration of Trust.
Moreover, if the Trust has more than one series, no series of the Trust other
than the series on whose behalf a specified transaction shall have been
undertaken shall be responsible for the obligations of the Trust, and persons
engaging in transactions with the Trust shall look only to the assets of that
series to satisfy those obligations. The execution and delivery of this
Agreement has been authorized by the Trustees and signed by an authorized
officer of the Trust, acting as such, and neither such authorization by such
Trustees nor such execution and delivery by such officer shall be deemed to have
been made by any of them but shall bind only the trust property of the Trust as
provided in such Declaration of Trust.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of the day and
year first above written.
XXXXX TREASURY ONLY MONEY MARKET FUND
By: /s/ Xxxxxx X. Xxxxxxx
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President
Attest: /s/ Xxxxxx-Xxxx Xxxxx
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Secretary
XXXXX CAPITAL SECURITIES, INC..
By: /s/ Xxxxxx X. Xxxxxxx
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President
Attest: /s/ Xxxxxx-Xxxx Xxxxx
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Secretary
