Exhibit 6(c)
DISTRIBUTION AGREEMENT
DISTRIBUTION AGREEMENT, dated October 9, 1997, between Tweedy,
Xxxxxx Fund Inc., a Maryland corporation (the "Company"), and Tweedy, Xxxxxx
Company LLC., a Delaware limited liability company (the "Distributor"). The
Company is registered as an investment company under the Investment Company Act
of 1940 (the "1940 Act"), and an indefinite number of shares (the "Shares") of
Tweedy, Xxxxxx Global Value Fund Stock (the "Fund"), par value $.0001 per share
(the "Shares"), have been registered under the Securities Act of 1933 (the "1933
Act") to be offered for sale to the public in a continuous public offering in
accordance with terms and conditions set forth in the Prospectus and Statement
of Additional Information (the "Prospectus") of the Fund included in the
Company's Registration Statement on Form N-lA as such documents may be amended
from time to time.
In this connection, the Company desires that the Distributor
act as its exclusive sales agent and distributor for the sale and distribution
of Shares. The Distributor has advised the Company that it is willing to act in
such capacities, and it is accordingly agreed between them as follows:
1. The Company hereby appoints the Distributor as exclusive sales agent and
distributor for the sale and distribution of Shares pursuant to the aforesaid
continuous public offering of Shares, and the Company further agrees from and
after the commencement of such continuous public offering that it will not,
without the Distributor's consent, sell or agree to sell any Shares otherwise
than through the Distributor, except the Company may issue Shares in connection
with a merger, consolidation or acquisition of assets on such basis as may be
authorized or permitted under the 0000 Xxx.
2. The Distributor hereby accepts such appointment and agrees to use
commercially reasonable efforts to sell such Shares, provided, however, that
when requested by the Company at any time for any reason the Distributor will
suspend such efforts. The Company may also withdraw the offering of Shares at
any time when required by the provisions of any statute, order, rule or
regulation of any governmental body having jurisdiction. It is understood that
the Distributor does not undertake to sell all or any specific portion of the
Shares.
3. The Distributor represents that it is a member in good standing of the
National Association of Securities Dealers, Inc. and agrees that it will use all
reasonable efforts to maintain such status and to abide by the Rules of Fair
Practice, the Constitution and the Bylaws of the National Association of
Securities Dealers, Inc., and all other rules and regulations that are now or
may become applicable to its performance hereunder. The Distributor will
undertake and discharge its obligations hereunder as an independent contractor
and it shall have no authority or power to obligate or bind the Company by its
actions, conduct or contracts except that it is authorized to accept orders for
the purchase or repurchase of Shares as the Company's agent and subject to its
approval. The Company reserves the right to reject any order in whole or in
part. The Distributor may appoint sub-agents or distribute through dealers or
otherwise as it may determine from time to time pursuant to agreements approved
by the Company, but this Agreement shall not be construed as authorizing any
dealer or other person to accept orders for sale or repurchase of Shares on
behalf of the Company or otherwise act as the Company's agent for any purpose.
The Distributor shall not utilize any materials in connection with the sale or
offering of Shares except the then current Prospectus and such other materials
as the Company shall provide or approve in writing.
4. Shares may be sold by the Distributor only at prices and terms described in
the then current Prospectus relating to the Shares and may be sold either
through persons with whom it has selling agreements in a form approved by the
Company's Board of Directors or directly to prospective purchasers. To
facilitate sales, the Company will furnish the Distributor with the net asset
value of its Shares promptly after each calculation thereof.
5. The Company has delivered to the Distributor a copy of the current Prospectus
for the Fund. It agrees that it will use its best efforts to continue the
effectiveness of its Registration Statement filed under the 1933 Act and the
1940 Act. The Company further agrees to prepare and file any amendments to its
Registration Statement as may be necessary and any supplemental data in order to
comply with such Acts. The Company will furnish the Distributor at the
Distributor's expense with a reasonable number of copies of the Prospectus and
any amended Prospectus for use in connection with the sale of Shares.
6. At the Distributor's request, the Company will take such steps at its own
expense as may be necessary and feasible to qualify Shares for sale in states,
territories or dependencies of the United States of America and in the District
of Columbia in accordance with the laws thereof, and to renew or extend any such
qualification; provided, however, that the Company shall not be required to
qualify Shares or to maintain the qualification of Shares in any state,
territory, dependency or district where it shall deem such qualification
disadvantageous to the Fund.
7. The Distributor agrees that:
1. It will furnish to the Company any pertinent information required to be
inserted with respect to the Distributor as exclusive sales agent and
distributor within the purview of Federal and state securities laws in
any reports or registrations required to be filed with any government
authority;
2. It will not make any representations inconsistent with the information
contained in the Registration Statement or Prospectus filed under the
Securities Act of 1933, as in effect from time to time;
3. It will not use or distribute or authorize the use or distribution of
any statements other than those contained in the Fund's then current
Prospectus or in such supplemental literature or advertising as may be
authorized by the Company; and
4. The Distributor will bear the costs and expenses of printing and
distributing any copies of any prospectuses and annual and interim
reports of the Fund (after such items have been prepared and set in
type) which are used in connection with the offering of Shares, and the
costs and expenses of preparing, printing and distributing any other
literature used by the Distributor or furnished by the Distributor for
use in connection with the offering of the Shares and the costs and
expenses incurred by the Distributor in advertising, promoting and
selling Shares of the Fund to the public.
8. The Company will pay its legal and auditing expenses and the cost of
composition of any prospectuses of annual or interim reports of the Fund.
9. The Company agrees to indemnify, defend and hold the Distributor, its
officers, directors, employees and agents and any person who controls the
Distributor within the meaning of Section 15 of the 1933 Act (each, an
"indemnitee"), free and harmless from any and all liabilities and expenses,
including costs of investigation or defense (including reasonable counsel fees)
incurred by such indemnitee in connection with the defense or disposition of any
action, suit or other proceeding, whether civil or criminal, in which such
indemnitee may be or may have been involved as a party or otherwise or with
which he may be or may have been threatened, while the Distributor was active in
such capacity or by reason of the Distributor having acted in any such capacity
or arising out of or based upon any untrue statement of a material fact
contained in the then-current Prospectus relating to the Shares or arising out
of or based upon any alleged omission to state a material fact required to be
stated therein 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 the Distributor to the Company expressly for use in any such
Prospectus; provided, however, that (1) no indemnitee shall be indemnified
hereunder against any liability to the Company or the shareholders of the Fund
or any expense of such indemnitee with respect to any matter as to which such
indemnitee shall have been adjudicated not to have acted in good faith in the
reasonable belief that its action was in the best interest of the Company or
arising by reason of such indemnitee's 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 Agreement ("disabling conduct"), or (2)
as to any matter disposed of by settlement or a compromise payment by such
indemnitee, no indemnification shall be provided unless there has been a
determination that such settlement or compromise is in the best interests of the
Company and that such indemnitee appears to have acted in good faith in the
reasonable belief that its action was in the best interest of the Company and
did not involve disabling conduct by such indemnitee. Notwithstanding the
foregoing the Company shall not be obligated to provide any such indemnification
to the extent such provision would waive any right which the Company cannot
lawfully waive.
The Distributor agrees to indemnify, defend and hold the
Company, its Directors, officers, employees and agents and any person who
controls the Company within the meaning of Section 15 of the 1933 Act (each, an
"indemnitee"), free and harmless from and against any and all liabilities and
expenses, including costs of investigation or defense (including reasonable
counsel fees) incurred by such indemnitee, but only to the extent that such
liability or expense shall arise out of or be based upon any untrue or alleged
untrue statement of a material fact contained in information furnished in
writing by the Distributor of the Company expressly for use in a Prospectus or
any alleged omission to state a material fact in connection with such
information required to be stated therein or necessary to make such information
not misleading or arising by reason of disabling conduct by such indemnitee or
any person selling Shares pursuant to an agreement with the Distributor.
The Company shall make advance payments in connection with the
expenses of defending any action with respect to which indemnification might be
sought hereunder if the Company receives a written affirmation of the
indemnitee's good faith belief that the standard of conduct necessary for
indemnification has been met and a written undertaking to reimburse the Company
unless it is subsequently determined that he is entitled to such indemnification
and if the directors of the Company determine that the facts then known to them
would not preclude indemnification. In addition, at least one of the following
conditions must be met: (A) the indemnitee shall provide a security for his
undertaking, (B) the Company shall be insured against losses arising by reason
of any lawful advances, or (C) a majority of a quorum of directors of the
Company who are neither "interested persons" of the Company (as defined in
Section 2(a)(19) of the Act) nor parties to the proceeding ("Disinterested
Non-Party Directors") or an independent legal counsel in a written opinion,
shall determine, based on a review of readily available facts (as opposed to a
full trial-type inquiry), that there is reason to believe that the indemnitee
ultimately will be found entitled to indemnification.
All determinations with respect to indemnification hereunder
shall be made (1) by a final decision on the merits by a court or other body
before whom the proceeding was brought that such indemnitee is not liable by
reason of disabling conduct or, (2) in the absence of such a decision, by (i) a
majority vote of a quorum of the Disinterested Non-party Directors of the
Company, or (ii) if such a quorum is not obtainable or even, if obtainable, if a
majority vote of such quorum so directs, independent legal counsel in a written
opinion.
10. This Agreement shall become effective on the date first set forth above and
shall remain in effect for two years from such date and thereafter from year to
year provided such continuance is specifically approved at least annually prior
to each anniversary of such date by (a) the approval of a majority of a quorum
of directors of the Company or by vote at a meeting of shareholders of the Fund
of the lesser of (i) 67 per cent of the Shares present or represented by proxy
and (ii) 50 per cent of the outstanding Shares and (b) by the approval of a
majority of a quorum of directors of the Company who are not "interested
persons" of the Company (as defined in Section 2(a)(19) of the Act).
11. This Agreement may be terminated (a) by the Distributor at any time without
penalty by giving sixty (60) days' written notice to the Company (which notice
may be waived by the Company); or (b) by the Company at any time without penalty
upon sixty (60) days' written notice to the Distributor (which notice may be
waived by the Distributor); provided, however, that any such termination by the
Company shall be directed or approved in the same manner as required for
continuance of this Agreement by Section 10.
12. This Agreement may not be amended or changed except in writing signed by
each of the parties hereto and approved in the same manner as provided for
continuance of this Agreement in Section 10. Any such amendment or change shall
be binding upon and shall inure to the benefit of the parties hereto and their
respective successors, but this Agreement shall not be assigned by either party
and shall automatically terminate upon assignment (as such term is defined in
the 1940 Act and the rules thereunder).
13. This Agreement shall be construed in accordance with the laws of the State
of New York applicable to agreements to be performed entirely therein and in
accordance with applicable provisions of the 1940 Act.
14. If any provision of this Agreement shall be held or made invalid or
unenforceable by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected or impaired thereby.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized officers as of the date first written
above.
TWEEDY, XXXXXX FUND INC.
By: XXXXXXXXXXX X. XXXXXX
Name: Xxxxxxxxxxx X. Xxxxxx
Title: President
TWEEDY, XXXXXX COMPANY LLC
By: XXXXXXX X. XXXXXX
Name: Xxxxxxx X. Xxxxxx
Title: Member, Managing Director
