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SOGEN FUNDS, INC.
1221 Avenue of the Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
July 1, 1999
Funds Distributor, Inc.
00 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Underwriting Agreement
Dear Sirs:
SoGen Funds, Inc. (the "Company"), a Maryland corporation currently
consisting of the portfolios listed on Schedule A, attached hereto, together
with all other portfolios subsequently established and made subject to this
Agreement, is engaged in the business of an investment company. Its Board of
Directors has selected you to act as principal underwriter (as such term is
defined in Section 2(a)(29) of the Investment Company Act of 1940, as amended)
of the shares of Capital Stock of the Company and you are willing to act as such
principal underwriter and to perform the duties and functions of underwriter in
the manner and on the conditions hereinafter set forth. Accordingly, the Company
hereby agrees with you as follows:
1. Copies of Corporate Documents. The Company will furnish you promptly
with copies of any registration statements filed by it with the Securities and
Exchange Commission under the Securities Act of 1933, as amended, and the
Investment Company Act of 1940, as amended, together with any financial
statements and exhibits included therein, and all amendments or supplements
thereto hereafter filed.
2. Registration and Sale of Additional Shares. The Company will from time
to time use its best efforts to register under the Securities Act of 1933, as
amended, such authorized shares of Capital Stock not already so registered as
you may reasonably be expected to sell as agent on behalf of the Company. To the
end that there will be available for sale such number of shares as you may
reasonably be expected to sell, the Company, subject to the necessary approval
of its shareholders, will, from time to time as may be necessary, increase the
number of authorized shares. This agreement relates to the issue and sale of
shares that are duly authorized and registered and available for sale by the
Company, including repurchased and redeemed shares if and to the extent that
they may be legally sold and if, but only if, the Company sees fit
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to sell them. You and the Company will cooperate in taking such action as may be
necessary from time to time to qualify shares of the Company for sale in New
York and in any other states mutually agreeable to you and the Company, and to
maintain such qualification, provided that such shares are duly registered under
the Securities Act of 1933, as amended.
The Company represents to you that all registration statements and
prospectuses filed by the Company with the Securities and Exchange Commission
under the Securities Act of 1933 and under the Investment Company Act of 1940
with respect to the shares have been prepared in conformity with the
requirements of said Acts and rules and regulations of the Securities and
Exchange Commission thereunder. As used in this Agreement the terms
"registration statement" and "prospectus" shall mean any registration statement
and prospectus, including the statement of additional information incorporated
by reference therein, filed with the Securities and Exchange Commission and any
amendments and supplements thereto which at any time shall have been filed with
said Commission. The Company represents and warrants to you that any
registration statement and prospectus, when such registration statement becomes
effective, will contain all statements required to be stated therein in
conformity with said Acts and the rules and regulations of said Commission; that
all statements of fact contained in any such registration statement and
prospectus will be true and correct when such registration statement becomes
effective; and that neither any registration statement nor any prospectus when
such registration statement becomes effective will include an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading. The Company
may, but shall not be obligated to, propose from time to time such amendment or
amendments to any registration statement and such supplement or supplements to
any prospectus as, in the light of future developments, may, in the opinion of
the Company's counsel, be necessary or advisable. If the Company shall not
propose such amendment or amendments and/or supplement or supplements within
fifteen days after receipt by the Company of a written request from you to do so
with respect to a material change, you may, at your option, terminate this
Agreement or decline to make offers of the Company's securities until such
amendments are made. The Company shall not file any amendment to any
registration statement or supplement to any prospectus without giving you
reasonable notice thereof in advance; provided, however, that nothing contained
in this Agreement shall in any way limit the Company's right to file at any time
such amendments to any registration statement and/or
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supplements to any prospectus, of whatever character, as the Company may deem
advisable, such right being in all respects absolute and unconditional.
3. Solicitation of Orders. You will use your best efforts (but only in
states in which you may lawfully do so) to obtain from investors orders for
shares of the Capital Stock of the Company authorized for issue by the Company
and registered under the Securities Act of 1933, as amended, provided that you
may in your discretion refuse to accept orders for shares from any particular
applicant. You may, as agent for the Company, solicit dealers for orders to
purchase shares of the Capital Stock of the Company and may enter into selling
agreements with any such dealers, the form of such agreements to be as mutually
agreed upon, from time to time, by you and the Company. Each dealer must be a
member of the National Association of Securities Dealers, Inc. or a foreign
dealer not eligible for membership in such Association who has agreed in acting
under the selling agreement to abide by the rules and regulations of such
Association and not to use the United States mails or any means of interstate
commerce in connection with the sales of such shares unless such foreign dealer
is registered under the Securities Exchange Act of 1934 or such registration is
not required.
4. Sale of Shares. Subject to the provisions of paragraph 5 hereof and to
such minimum purchase requirements as may from time to time be currently
indicated in the Company's prospectus, you are authorized to sell as agent on
behalf of the Company authorized and unissued shares of the Capital Stock of the
Company registered under the Securities Act of 1933, as amended. Such sales may
be made by you on behalf of the Company by transmitting promptly any orders
received by you for the purchase and redemption of shares to the Company's
transfer agent. The sales price to the public of such shares shall be the public
offering price as defined in paragraph 6 hereof.
Whenever in their judgment such action is warranted by unusual market,
economic or political conditions, or by abnormal circumstances of any kind
deemed by the parties hereto to render sales of the Company's shares not in the
best interest of the Company, the parties hereto may decline to accept any
orders for, or make any sales of, any shares until such time as those parties
deem it advisable to accept such orders and to make such sales and both parties
shall mutually agree to any such determination.
5. Sale of Shares to Investors by the Company. Any right granted to you to
accept orders for shares or make sales on behalf of the Company will not apply
to shares issued in
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connection with the merger or consolidation of any other investment company with
the Company or its acquisition, by purchase or otherwise, of all or
substantially all the assets of any investment company or substantially all the
outstanding shares of any such company, and such right shall not apply to shares
that may be offered by the Company to shareholders by virtue of their being
shareholders of the Company, including shares issued in payment of any dividend
or distribution by the Company.
6. Public Offering Price. All shares of the Company sold to investors by
you as agent for the Company will be sold at the public offering price. The
public offering price for all accepted orders will be the net asset value per
share next computed after receipt of such an order, plus any applicable sales
charge adjusted to the nearest full cent, as may from time to time be currently
indicated in the Company's prospectus with respect to such order. Net asset
value per share shall be computed in the manner provided in the Company's
Articles of Incorporation, as now in effect or as it may be amended. The time of
receipt of such an order shall be the time of its receipt by you or by a dealer
selected by you as provided in paragraph 3 if transmitted on the day of receipt
by such dealer to you prior to the close of your business on that day. The
Company will not, without notifying you in advance, change the sales charges or
dealer discounts applicable to the sales of its shares from those set forth in
its then-current prospectus. You may also purchase as principal shares of the
Company's Capital Stock at net asset value and sell such shares at the public
offering price.
7. Underwriting Discount. The Company shall receive from you the applicable
net asset value on all orders for sales of shares of Capital Stock accepted by
you as agent of the Company if the net sale price thereof has been deemed, in
accordance with the Company's Articles of Incorporation, to be an asset of the
Company in connection with a computation of net asset value for the sale of any
other shares or the purchase or redemption of any shares. You shall be entitled
to retain so much of the difference between the public offering price and the
applicable net asset value as is not reallowed by you as a discount to dealers.
Such reallowance shall be the same for all dealers and shall conform to such
dealer discounts, if any, as may from time to time be currently indicated in the
Company's prospectus. You will reimburse the Company for any increase in any
issue tax paid by it which is attributable to such sales charge.
8. Notice of Sale; Delivery of Payments. You will promptly notify the
Company's transfer agent or shareholders' servicing agent of any orders for
sales of shares of Capital Stock
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accepted by you, and you will deliver to the Company's shareholders' servicing
agent all payments pursuant to orders for sales accepted by you no later than
the first business day following the receipt by you in your home office of such
payments, and, unless payment is not required under paragraph 7, in no event
later than seven days after the receipt by you of such order, or, in case an
extension of time is granted by the National Association of Securities Dealers,
Inc., to the dealer submitting the order, in no event later than the expiration
of such extension of time.
9. Purchase of Shares. You are authorized to purchase as agent on behalf of
the Company shares of the Capital Stock of the Company from record holders
thereof. Such purchases may be made by you on behalf of the Company by accepting
orders placed with you by such holders. The purchase price per share for all
accepted orders will be the net asset value per share next computed after
receipt of such an order, in the manner provided in the Company's Articles of
Incorporation, as now in effect or as it may be amended. The time of receipt of
such an order shall be the time of its receipt by you or by a dealer selected by
you as provided in paragraph 3 if transmitted on the day of receipt by such
dealer to you prior to the close of your business on that day. You will promptly
notify the Company's transfer agent or shareholders' servicing agent of any such
order accepted by you and will, if the shares subject to such order have been
deemed to be no longer outstanding in connection with a computation of net asset
value for the sale of any shares by the Company or the purchase or redemption of
any shares by it deliver to such agent a proper request for purchase of such
shares by the Company and any stock certificates for such shares not later than
the first business day following the receipt by you in your home office of such
request and certificates, and in no event later than seven days after the
receipt by you of such order.
10. Suspension of Sales and Purchases. If and whenever the determination of
asset value is suspended pursuant to the Company's Articles of Incorporation,
and such suspension has become effective, until such suspension is terminated no
further orders for the sale or purchase of shares shall be accepted by you
except such orders placed with you before you had knowledge of the suspension.
In addition, the Company reserves the right to suspend sales and purchases and
your authority to accept orders for sales and purchases of shares on behalf of
the Company if, in the judgment of a majority of its Board of Directors or a
majority of the Executive Committee of its Board of Directors, if such Committee
exists, it is in the best interests of the Company to do
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so, such suspension to continue for such period as may be determined by such
majority; and in that event, no shares will be sold or purchased by the Company
or by you on behalf of the Company while such suspension remains in effect
except for shares necessary to cover orders accepted by you before you had
knowledge of the suspension. The Company will notify you promptly of any such
suspension of the determination of net asset value or of any such suspension of
sales and purchases of shares.
The Company agrees to advise you immediately in writing:
(a) of any request by the Securities and Exchange Commission for amendments
to the registration statement or prospectus then in effect or for additional
information;
(b) in the event of the issuance by the Securities and Exchange Commission
of any stop order suspending the effectiveness of the registration statement or
prospectus then in effect or the initiation of any proceeding for that purpose;
(c) of the happening of any event, to the best of its knowledge, which
makes untrue any statement of a material fact made in the registration statement
or prospectus then in effect or which requires the making of a change in such
registration statement or prospectus in order to make the statements therein not
misleading; and
(d) of all actions of the Securities and Exchange Commission with respect
to any amendments to any registration statement or prospectus which may from
time to time be filed with the Securities and Exchange Commission that
materially affect the performance of your services under this Agreement.
11. Expenses. The Company will pay all fees and expenses in connection with
the preparation and filing of any registration statement and prospectus or
amendments thereto under the Securities Act of 1933, as amended, covering the
issue and sale of its shares and in connection with the qualification of shares
for sale in the various states and countries in which the Company shall
determine it advisable to qualify such shares for sale, the costs of all stock
certificates and the fees and expenses of its transfer agent or shareholders'
servicing agent or registrar. It will also pay any issue taxes (subject to
partial reimbursement under paragraph 7 hereof). You will pay all expenses of
printing prospectuses and other sales literature (except copies of prospectuses
and other sales literature which may from time to time be sent to existing
shareholders of the Fund), all fees and expenses in connection with your
qualification as a dealer in the various states and countries, and all other
expenses in connection with the sale and
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offering for sale of the shares of the Company which are not payable by the
Company pursuant to the provisions of this paragraph 11.
12. Conformity with Law. You agree that in selling and purchasing the
shares of the Company you will duly conform in all respects with the laws of the
United States and any state or country in which such shares may be offered for
sale by you pursuant to this agreement.
13. Indemnification. You agree to indemnify and hold harmless the Company
and each of its directors and officers and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act of 1933, as
amended, against any and all losses, claims, damages, liabilities or litigation
expenses (including legal and other expenses) to which the Company or such
directors, 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 or the sale of any shares by any person
to the Company through you which (i) may be based upon any wrongful act by you
or any of your 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 or prospectus covering shares of the Company 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 or confirmed in writing to the Company by
you, provided, however, that in no case is your indemnity in favor of a director
or officer or any other person deemed to protect such director 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.
The Company agrees to indemnify and hold harmless you and each of your
directors and officers and each person, if any, who controls you within the
meaning of Section 15 of the Securities Act of 1933, as amended, against any and
all losses, claims, damages, liabilities or litigation expenses (including legal
and other expenses) to which you or such directors, 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 or the
sale of any shares by any person to the Company through you which (i) may be
based upon any wrongful act by the Company or any of its employees or
representatives, or (ii) except as described in clause
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(ii) of the preceding paragraph, may be based upon any untrue statement or
alleged untrue statement or a material fact contained in a registration
statement or prospectus covering shares of the Company or any amendment thereof
or supplement thereto or omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, provided, however, that in no case is the Company's
indemnity in favor of a director or officer or any other person deemed to
protect such director 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. You hereby
waive any rights to indemnification concerning your obligations and duties
hereunder to which you might be entitled under the Company's By-Laws.
You are not authorized to give any information or to make any
representations on behalf of the Company in connection with the sale or purchase
of shares of the Company other than the information and representations
contained in a registration statement or prospectus covering shares of the
Company, as such registration statement and prospectus may be amended or
supplemented from time to time. No person other than you is authorized to act as
agent for the Company in connection with the offering or sale of shares of the
Company to the public or otherwise.
14. Duration and Termination of This Agreement. This Agreement shall become
effective as of the date hereof and will continue for an initial two-year term
and will continue from year to year thereafter, but only so long as such
continuance is specifically approved at least annually by the Board of Directors
of the Company or by vote of a majority of the outstanding voting securities of
the Company. In addition, the Company may not renew or perform this Agreement
unless the terms thereof and any renewal thereof have been approved by the vote
of a majority of directors of the Company who are not interested persons of you
or of the Company cast in person at a meeting called for the purpose of voting
on such approval. This Agreement may, on 60 days' written notice, be terminated
at any time without the payment of any penalty, by the Board of Directors of the
Company, by vote of a majority of the outstanding voting securities of the
Company, or by you. This Agreement shall 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 Investment Company Act of 1940, as
amended, and Rules
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thereunder (particularly the definitions of "interested person", "assignment",
"voting security" and "vote of a majority of the outstanding voting securities")
shall be applied.
15. Amendment of This Agreement. No provision 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 Company should at any time deem it
necessary or advisable in the best interests of the Company 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 you of the form of such amendment, and the reasons therefor, and if you
should decline to assent to such amendment, the Company may terminate this
agreement forthwith. If you should at any time request that a change be made in
the Company's Articles of Incorporation 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 you are or may be a member, relating to the sale of the
shares of the Company, and the Company should not make such necessary change
within a reasonable time, you may terminate this agreement forthwith.
16. Miscellaneous.
(a) 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. This agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
(b) The Company recognizes that, except to the extent otherwise agreed to
by the parties hereto, your directors, officers and employees may from time to
time serve as directors, trustees, officers and employees of corporations and
business trusts (including other investment companies), and that you or your
affiliates may enter into distribution or other agreements with other
corporations and trusts.
(c) In the event that the Board of Directors of any additional portfolios
indicate by vote that such portfolios are to be made parties to this Agreement,
whether such portfolios were in existence at the time of the effective date of
this Agreement or subsequently formed, Schedule A
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hereto shall be amended to reflect the addition of such new portfolios and such
new portfolios shall thereafter become parties hereto. In the event that any of
the portfolios on Schedule A terminates its registration as a management
investment company, or otherwise ceases operations, Schedule A shall be amended
to reflect the deletion of such portfolio and its various classes.
(d) This Agreement shall be governed by the internal laws of The
Commonwealth of Massachusetts without giving effect to principles of conflicts
of laws.
(e) 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. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors.
(f) You hereby represent, warrant and covenant that your computer software
and hardware used in the performance of Underwriting Services ("Services") and
the provision of the services itself for the Company are Year 2000 Compliant.
For the purposes of this Agreement, "Year 2000 compliant" means that the
equipment/software: (a) will manage, manipulate, input, accept, process, store
and output data involving 4-digit year dates, including single century formulas
and multi-century formulas, and will not malfunction or generate incorrect
values or invalid results involving such dates; and (b) shall accurately process
date/time data from, into and between the 20th and 21st centuries and the years
1999 and 2000 and leap year calculations; and (c) provides that all date-related
user and data interface functionalities and data fields include the indication
of century; and (d) when used in combination with other information technology
shall accurately process date/time data if the other information technology
properly exchanges date/time data with it; and (e) will not cause any other item
that is otherwise Year 2000 Compliant to fail to be Year 2000 Compliant. In the
event of any breach of this warranty, you shall, as expeditiously as possible,
replace or repair non-compliant products or systems so as to minimize
interruption to the Company's ongoing business operations, time being of the
essence, at your sole cost and expense.
You also agree that if, as a result of your breach of this Warranty, the
Company is subjected to any fine, penalty, or other regulatory sanction or
damages, you will reimburse the Company for such fine, penalty or damages and
any related costs and expenses, including but not limited to attorney fees and
expenses.
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If you are in agreement with the foregoing, please sign the form of
acceptance an the accompanying counterpart of this letter and return such
counterpart to the Company, whereupon this letter shall become a binding
contract.
Yours very truly,
SOGEN FUNDS, INC.
By ________________________________
Vice President
The foregoing Agreement is
hereby accepted as of the
date thereof.
FUNDS DISTRIBUTOR, INC.
By ___________________________
Name: ________________________
Title: _______________________
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SCHEDULE A
SOGEN FUNDS, INC.
SoGen International Fund
SoGen Overseas Fund
SoGen Gold Fund
SoGen Money Fund
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