Exhibit 6(a)
THE OLSTEIN FUNDS
XXXXXX SQUARE DISTRIBUTORS, INC.
XXXXXXX & ASSOCIATES, L.P.
DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT is made as of the 18th day of August, 1995,
among The Olstein Funds (the "Trust"), a Delaware business trust, Xxxxxx
Square Distributors, Inc. ("Xxxxxx Square"), a corporation organized under the
laws of the State of Delaware, having its principal place of business in
Wilmington, Delaware, and Xxxxxxx & Associates, L.P. ("Olstein"), a limited
partnership organized under the laws of the State of New York. Xxxxxx Square
and Olstein together may be referred to herein as the "National Distributors."
WHEREAS, the Trust is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management investment
company;
WHEREAS, the National Distributors are engaged in the business of
promoting the distribution of the securities of investment companies, and are
members of the National Association of Securities Dealers (the "NASD") and are
registered as broker-dealers under the Securities Exchange Act of 1934 (the
"1934 Act");
WHEREAS, the Trust is authorized to issue an unlimited number of shares
of beneficial interest, par value $0.001 per share ("Shares") in one or more
classes or series, and has registered such Shares for public offering and
distribution under the Securities Act of 1933 (the "1933 Act") and any
applicable state securities laws;
WHEREAS, the Trust is authorized to offer for public sale one or more
distinct series of Shares of beneficial interest ("Series"), representing an
undivided interest in the assets, subject to the liabilities, allocated to
that Series and each Series having a separate investment objective and
policies;
WHEREAS, the Trust anticipates that it will establish multiple Series
(each a "Fund");
WHEREAS, the Trust wishes to employ the services of the National
Distributors to assist in the distribution of the Shares in accordance with
applicable laws and such Plan of Distribution as the Trust may adopt; and
WHEREAS, the National Distributors wish to provide distribution services
to the Trust as set forth below;
NOW, THEREFORE, in consideration of the mutual premises and undertakings
herein contained, the parties agree as follows:
DIST.RTF
1. SALE OF SHARES. During the term of this Agreement the Trust grants
to the National Distributors the right to sell on its behalf Shares of all
Series of the Trust, now or hereafter created, subject to the registration
requirements of the 1933 Act, and of the laws governing the sale of securities
in various states (the "Blue Sky Laws") under the terms and conditions set
forth herein. In connection therewith, the National Distributors (i) shall
have the right to sell, as agent on behalf of the Trust, Shares authorized for
issue and registered under the 1933 Act and applicable Blue Sky Laws; (ii)
shall sell such Shares only in compliance with applicable law, the terms set
forth in the Trust's currently effective registration statement, and in
accordance with any Plan of Distribution of the Trust for any Series, as may
be in effect from time to time, and further in compliance with any limitations
which may be imposed by the Trustees of the Trust, and (iii) shall, subject to
approval by the Trustees of the Trust, agree to the delegation of
responsibilities among themselves under this Agreement as provided in Schedule
A to this Agreement, which may be amended from time to time. The National
Distributors are not obligated to sell any specific number of Shares.
2. SELLING DEALER AGREEMENTS. Subject to the supervisory authority of
the Trustees of the and on such terms as are authorized by the Trust, Olstein
may enter into selling dealer agreements with selected dealers and others
("Selling Dealers") for the provision of distribution services related to the
sale of Trust Shares as well as other shareholder services as agreed by
affected parties. Olstein only will act as principal in entering into such
selling dealer agreements.
3. SALE OF SHARES BY THE TRUST. The rights granted to the National
Distributors shall be non-exclusive in that the Trust reserves the right to
sell its Shares to investors on applications received and accepted by the
Trust. Further, the Trust reserves the right to issue Shares in connection
with (a) the merger or consolidation of the assets of, or acquisition by the
Trust through purchase or otherwise, with any other investment company, trust
or personal holding company; (b) the payment or reinvestment of dividends or
distributions; or (c) any offer of exchange permitted by Section 11 of the
1940 Act.
4. SHARES COVERED BY THIS AGREEMENT. This Agreement shall apply to
Shares of all Series of the Trust, Shares of all Series of the Trust held in
its treasury in the event that in the discretion of the Trust treasury Shares
shall be sold, and Shares of all Series of the Trust repurchased for resale.
5. PUBLIC OFFERING PRICE. Except as otherwise noted in the Trust's
current Prospectus (the "Prospectus") or Statement of Additional Information
(the "SAI") with respect to each Series, all Shares sold to investors by the
National Distributors or the Trust will be sold at the public offering price.
The public offering price for all accepted subscriptions will be the net asset
value per share, plus any applicable sales charge on such Shares, determined
in the manner described in the Trust's current Prospectus or SAI with respect
to the applicable Series. The Trust shall in all cases receive not less than
the net asset value per share on all sales.
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6. SUSPENSION OF SALES. If and whenever the determination of net asset
value is suspended and until such suspension is terminated, no further orders
for Shares shall be processed by the National Distributors except such
unconditional orders placed with the National Distributors before it had
knowledge of the suspension. In addition, the Trust reserves the right to
suspend sales and the National Distributors's authority to process orders for
Shares on behalf of the Trust if, in the judgment of the Trust, it is in the
best interests of the Trust to do so. Suspension will continue for such period
as may be determined by the Trust. In addition, the Trust and the National
Distributors reserve the right to reject any purchase order.
7. SOLICITATION OF SALES. In consideration of these rights granted to
the National Distributors, the National Distributors agree to use all
reasonable efforts, consistent with their other business, to secure purchasers
for Shares of the Trust. This shall not prevent the National Distributors
from entering into like arrangements (including arrangements involving the
payment of underwriting commissions) with other issuers. The National
Distributors agree to use all reasonable efforts to ensure that taxpayer
identification numbers provided for shareholders of the Trust are correct.
8. AUTHORIZED REPRESENTATIONS. The National Distributors are not
authorized by the Trust to give any information or to make any representations
other than those contained in the appropriate registration statements,
Prospectuses or SAI's filed with the Securities and Exchange Commission (the
"SEC") under the 1933 Act or with the states under applicable Blue Sky Laws
(as those registration statements, Prospectuses and SAI's may be amended from
time to time), or contained in shareholder reports or other material that may
be prepared by or on behalf of the Trust for the National Distributors' use.
This shall not be construed to prevent the National Distributors from
preparing and distributing, in compliance with applicable laws and
regulations, sales literature or other material as it may deem appropriate.
The National Distributors will furnish or cause to be furnished copies of such
sales literature or other material to the President of the Trust or his or her
designee and will provide that designee with a reasonable opportunity to
comment on it. The National Distributors agree to take appropriate action to
cease using such sales literature or other material to which the Trust
reasonably objects as promptly as practicable after receipt of the objection.
9. REGISTRATION OF SHARES. The Trust agrees that it will take all
action necessary to register under the 1933 Act and applicable state Blue Sky
Laws all shares which are to be made subject to any public offering or sale
(subject to the necessary approval, if any, of its shareholders) so that there
will be available for sale the number of Shares the National Distributors may
reasonably be expected to sell. The Trust shall furnish to the National
Distributors copies of all information, financial statements and other papers
which the National Distributors may reasonably request for use in connection
with the distribution of Shares of each Series of the Trust.
10. REPURCHASE OF SHARES. The National Distributors as agent and for the
account of the Trust may repurchase Shares offered for resale to either of
them, and redeem such Shares at their net asset value.
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11. EXPENSES, COMPENSATION AND REIMBURSEMENT.
(a) The Trust shall pay all fees and expenses:
(i) in connection with the preparation, setting in type and
filing of any registration statement, Prospectus and SAI
under the 1933 Act, and any amendments thereto, for the
registration of its Shares;
(ii) in connection with the registration and qualification of
Shares for sale in the various states in which the Board
of Trustees (the "Trustees") of the Trust shall determine
it advisable to qualify such Shares for sale (including
registering the Trust or Series as a broker or dealer or
any officer of the Trust as agent or salesperson in any
state);
(iii) of preparing, setting in type, printing and mailing
any report or other communication to shareholders of the
Trust in their capacity as such; and
(iv) of preparing, setting in type, printing and mailing
Prospectuses, SAI's, and any supplements thereto, sent to
existing shareholders.
(b) The National Distributors shall pay costs of:
(i) printing and distributing Prospectuses, SAI's and reports
prepared for its use in connection with the offering of
Shares for sale to the public;
(ii) any other literature used in connection with such
offering;
(iii) advertising in connection with such offering
including, but not limited to public relations services,
sales presentations, media charges, and preparation,
printing and mailing of advertising and sales literature;
data processing necessary to support a distribution
effort; printing and mailing prospectuses to prospective
investors; sales commissions; and distribution and
shareholder servicing activities of broker-dealers and
other financial institutions; and
(iv) filing fees required by regulatory authorities for sales
literature and advertising materials and any additional
out-of-pocket expenses incurred in connection with these
and any other costs of distribution.
(c) In addition to the services described above, the National
Distributors will provide services, including assistance in the
production of marketing and advertising materials for the sale
of Shares of the Trust, and Xxxxxx Square will review them for
compliance with applicable regulatory requirements and submit
them for required regulatory review.
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(d) In connection with the services to be provided by the National
Distributors under this Agreement:
(i) Olstein shall pay to Xxxxxx Square an annual fee as
provided in Schedule A, and shall advance to, or reimburse
Xxxxxx Square for, disbursements and expenses which Xxxxxx
Square may incur pursuant to this Agreement; and
(ii) Olstein shall receive from the Trust such underwriting
discounts as shall be authorized from time to time with
respect to the sale of Shares, such payments as shall be
authorized to be paid by the Trust pursuant to any Plan of
Distribution adopted by the Trust in accordance with Rule
12b-1 under the 1940 Act, and reimbursement of such
expenses of the Trust as may be paid by Olstein from time
to time.
(e) In connection with the services to be provided by the National
Distributors under this Agreement, and payments to be made and
expenses to be incurred by the parties under this Agreement,
each National Distributor agrees to provide to the Board of
Trustees of the Trust such information as may be required to be
reviewed by the Trustees under Rule 12b-1 of the 1940 Act,
including such financial information as may be required in
connection with the adoption, supervision, or continuation of
any Plan of Distribution of the Trust under such rule, or the
adoption of any budget thereunder.
(f) For purposes of Shares purchased via Fund/SERV:
(i) Xxxxxx Square agrees to enter into a certain Additional
Number Agreement with the National Securities Clearing
Corporation ("NSCC"), until such time as the Trust has
become a Fund Member itself,to obtain additional clearing
number from NSCC, to be used by Xxxxxx Square/Olstein
which number may be used for settlement of Fund/SERV
transactions;
(ii) The Trust agrees to guarantee payment to NSCC of any and
all charges imposed by NSCC from time to time relating to
the Xxxxxx Square/Olstein clearing number;
(iii) Xxxxxx Square shall forward all fees and charges to
the Xxxxxx Square/Olstein clearing number to the Fund for
payment by the Fund to NSCC;
(iv) The Trust shall accept full liability for any fees or
charges regarding transactions clearing through the
Xxxxxx Square/Olstein clearing number;
(v) Xxxxxx Square shall have the right to terminate the
Additional Number Agreement at any time following the
acceptance of the Trust as Fund Member and being issued
its own clearing number in accordance with transition
procedures.
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12. INDEMNIFICATION.
(a) The Trust agrees to indemnify and hold harmless each National
Distributor and each of its trustees and officers and each
person, if any, who controls such National Distributor within
the meaning of Section 15 of the 1933 Act against any loss,
liability, claim, damages or expense (including the reasonable
cost of investigating or defending any alleged loss, liability,
claim, damages, or expense and reasonable counsel fees incurred
in connection therewith) arising by reason of any person
acquiring any Shares of beneficial interest of the Trust, based
upon the 1933 Act or any other statute or common law, alleging
any wrongful act of the Trust or any of its employees or
representatives, or based upon the grounds that the
registration statements, Prospectuses, SAI's, shareholder
reports or other information filed or made public by the Trust
(as from time to time amended) included an untrue statement of
a material fact or omitted to state a material fact required to
be stated or necessary in order to make the statements not
misleading. However, the Trust does not agree to indemnify a
National Distributor or hold it harmless to the extent that the
statement or omission was made in reliance upon, and in
conformity with, information furnished to the Trust in writing
by or on behalf of such National Distributor. In no case (i)
is the indemnity of the Trust in favor of a National
Distributor or any person indemnified to be deemed to protect
the National Distributors or any person against any liability
to the Trust or its security holders to which the National
Distributor or such person would otherwise be subject by reason
of willful misfeasance, bad faith or ordinary negligence in the
performance of its duties or by reason of its reckless
disregard of its obligations and duties under this Agreement,
or (ii) is the Trust to be liable under its indemnity agreement
contained in this section with respect to any claim made
against the National Distributors or any person indemnified
unless the National Distributor or person, as the case may be,
shall have notified the Trust 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 the National Distributor or any
such person or after the National Distributor or such person
shall have received notice of service on any designated agent.
However, except to the extent the Trust is harmed thereby,
failure to notify the Trust of any claim shall not relieve the
Trust from any liability which it may have to the National
Distributors or any person against whom such action is brought
other than on account of its indemnity agreement contained in
this section. The Trust 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, but if
the Trust elects to assume the defense, the defense shall be
conducted by counsel chosen by it and satisfactory to the
National Distributors, or person or persons, defendant or
defendants in the suit. In the event the Trust elects to
assume the defense of any suit and retain counsel, the National
Distributors, officers or trustees or controlling person(s) or
defendant(s) in the suit, shall bear the fees and expenses of
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any additional counsel retained by them. If the Trust does not
elect to assume the defense of any suit, it will reimburse the
National Distributors, officers or trustee or controlling
person(s) or defendant(s) in the suit, for the reasonable fees
and expenses of any counsel retained by them. The Trust agrees
to notify the National Distributors 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 the Shares.
(b) Each National Distributor also covenants and agrees that it
will 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 loss, liability, damages, claim or expense (including the
reasonable cost of investigating or defending any alleged loss,
liability, damages, claim or expense and reasonable counsel
fees incurred in connection therewith) arising by reason of any
person acquiring any Shares, based upon the 1933 Act or any
other statute or common law, alleging any wrongful act of the
National Distributor from which such indemnification is sought,
or any of its employees or representatives, or alleging that
the registration statements, Prospectuses, SAI's, shareholder
reports or other information filed or made public by the Trust
(as from time to time amended) included an untrue statement of
a material fact or omitted to state a material fact required to
be stated or necessary in order to make the statements not
misleading, insofar as the statement or omission was made in
reliance upon, and in conformity with, information furnished in
writing to the Trust by or on behalf of the National
Distributor from which such indemnification is sought. In no
case (i) is the indemnity of a National Distributor in favor of
the Trust or any person indemnified to be deemed to protect the
Trust or any person against any liability to which the Trust or
such person 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 and duties under this Agreement, or (ii) is a
National Distributor to be liable under its indemnity agreement
contained in this section with respect to any claim made
against the Trust or any person indemnified unless the Trust or
person, as the case may be, shall have notified the National
Distributor 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 the Trust or any such person or after the Trust or such
person shall have received notice of service on any designated
agent. However, failure to notify a National Distributor of
any claim shall not relieve that National Distributor from any
liability which it may have to the Trust or any person against
whom the action is brought other than on account of its
indemnity agreement contained in this section. In the case of
any notice to a National Distributor, it 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, but if the National Distributor elects to assume
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the defense, the defense shall be conducted by counsel chosen
by it and satisfactory to the Trust, to its officers and
trustees and to any controlling person(s) or any defendants(s)
in the suit. In the event the National Distributor elects to
assume the defense of any suit and retain counsel, the Trust or
controlling person(s) or defendant(s) in the suit, shall bear
the fees and expenses of any additional counsel retained by
them. If the National Distributor does not elect to assume the
defense of any suit, it will reimburse the Trust, its officers
or Trustees, controlling person(s) or defendant(s) in the suit,
for the reasonable fees and expenses of any counsel retained by
them. Each National Distributor agrees to notify the Trust
promptly of the commencement of any litigation or proceedings
against it in connection with the issue and sale of any of the
Shares.
13. LIABILITY OF THE NATIONAL DISTRIBUTORS. Neither National
Distributor shall be liable for any damages or loss suffered by the Trust in
connection with the matters to which this Agreement relates, except for damage
or loss resulting from willful misfeasance, bad faith or gross negligence on
the National Distributor's part in the performance, or reckless disregard, of
its duties under this Agreement. Any person, even though also an officer,
partner, employee or agent of a National Distributor, or any of its
affiliates, who may be or become an officer of the Trust, shall be deemed,
when rendering services to or acting on any business of the Trust in any such
capacity (other than services or business in connection with the National
Distributors's duties under this Agreement), to be rendering such services to
or acting solely for the Trust and not as an officer, partner, employee or
agent or one under the control or direction of a National Distributor or any
of its affiliates, even if paid by a National Distributor or an affiliate
thereof.
14. ACTS OF GOD, EQUIPMENT FAILURE. Neither National Distributor shall
be liable for any delays or errors occurring by reason of circumstances not
reasonably foreseeable and beyond its control, including but not limited to
acts of civil or military authority, national emergencies, work stoppages,
fire, flood, catastrophe, acts of God, insurrection, war, riot or failure of
communication or power supply. In addition, in the event of equipment
breakdowns which are (i) beyond the reasonable control of a National
Distributor and (ii) not primarily attributable to the failure of the National
Distributor to reasonably maintain or provide for the maintenance of such
equipment, the respective National Distributor shall, at no additional expense
to the Trust, take reasonable steps in good faith to minimize service
interruptions but shall have no liability with respect thereto.
15. EFFECTIVENESS, TERMINATION.
(a) This Agreement shall become effective as of the date first
written above, and unless terminated as provided, shall
continue in force for two (2) years from the date of its
execution and thereafter from year to year, provided
continuance is approved at least annually by either (i) the
vote of a majority of the Trustees of the Trust, or by the vote
of a majority of the outstanding voting securities of the
Trust, and (ii) the vote of a majority of those Trustees of the
Trust who are not interested persons of the Trust and who are
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not parties to this Agreement or interested persons of any
party, cast in person at a meeting called for the purpose of
voting on the approval.
(b) This Agreement shall automatically terminate in the event of
its assignment. As used in this Section, the terms "vote of a
majority of the outstanding voting securities," "assignment"
and "interested person" shall have the respective meanings
specified in the 1940 Act and the rules enacted thereunder as
now in effect or as hereafter amended.
(c) In addition to termination by failure to approve continuance or
by assignment, this Agreement may at any time be terminated
without the payment of any penalty: (i) as to a National
Distributor, by the Trust (by the vote of a majority of the
Trustees of the Trust who are not interested persons of the
Trust, or by vote of a majority of the outstanding voting
securities of the Trust or an affected series of the Trust)
upon not less than sixty (60) days written notice to the
affected party; or (ii) as to Xxxxxx Square, by Olstein upon
not less than sixty (60) days written notice to Xxxxxx Square
and the Trust; or (iii) as to either National Distributor's own
participation, by such party upon not less than sixty (60) days
written notice to the other affected parties.
16. AMENDMENTS. The National Distributors and the Trust shall regularly
consult with each other regarding National Distributors' performance of their
obligations and their compensation under the foregoing provisions. In
connection therewith, the Trust shall submit to National Distributors at a
reasonable time in advance of filing with the SEC copies of any amended or
supplemented registration statement of the Trust (including exhibits) under
the 1933 Act, and the 1940 Act, and, a reasonable time in advance of their
proposed use, copies of any amended or supplemented forms relating to any
plan, program or service offered by the Trust. Any change in such materials
that would require any change in the National Distributors' obligations under
the foregoing provisions shall be subject to the burdened party's approval,
which shall not be unreasonably withheld. In the event that a change in such
documents or in the procedures contained therein increases the cost or
potential liability to the National Distributors in performing their
obligations hereunder by more than an insubstantial amount, the National
Distributors shall be entitled to receive reasonable compensation therefor.
This Agreement may be amended at any time by mutual consent of the
parties, provided that such consent on the part of the Trust shall have been
approved (i) by the Trustees of the Trust, or by a vote of a majority of the
outstanding voting securities of the Trust, and (ii) by vote of a majority of
the Trustees of the Trust who are not interested persons of the National
Distributors or of the Trust cast in person at a meeting called for the
purpose of voting on such amendment.
17. NOTICE. Any notice under this Agreement shall be given in writing
addressed to the party intended to receive such notice. Any notice may be
hand delivered, or may be sent by registered or certified mail, postage
prepaid, to the receiving party, at its principal place of business.
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18. SEVERABILITY. 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.
19. GOVERNING LAW. To the extent that state law has not been preempted
by the provisions of any law of the United States heretofore or hereafter
enacted, as the same may be amended from time to time, this Agreement shall be
administered, construed and enforced according to the laws of the State of
Delaware.
20. SHAREHOLDER LIABILITY. The National Distributors acknowledge that
they have received notice of and accept the limitations of liability set forth
in the Trust's Agreement and Declaration of Trust. The National Distributors
agree that the Trust's obligations hereunder shall be limited to the assets of
the Trust, and that the National Distributors shall have recourse solely
against the assets of the Series with respect to which the Trust's obligations
hereunder relate and shall have no recourse against the assets of any other
Series or against any shareholder, Trustee, officer, employee, or agent of the
Trust.
21. MISCELLANEOUS. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof. 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
in two counterparts, each of which taken together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.
THE XXXXXXX FUNDS
By: /s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx, President
XXXXXX SQUARE DISTRIBUTORS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx, President
XXXXXXX & ASSOCIATES, L.P.
By: /s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx, President
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SCHEDULE A
In accordance with Section 1 of the Distribution Agreement between the
Trust and the National Distributors, and subject to approval by the Trustees
of the Trust, the National Distributors agree to provide for the performance
of certain obligations and responsibilities under the Distribution Agreement
as follows:
X. XXXXXXX
Xxxxxxx, as co-underwriter and co-distributor, shall be responsible for
the following items under this Agreement:
1. Xxxxxxx shall establish and maintain a money market fund or money
market account with Wilmington Trust Company (the "Xxxxxxx Account"), and will
keep such account funded to the extent necessary to provide for: (a) the
payment of any up-front commissions due to Selling Dealers for sales of Trust
shares, (b) the payment of any distribution or servicing fees payable to
Selling Dealers or other servicing agents, and (c) the payment to a Fund of
the balance of the purchase price of its shares when, in connection with such
purchase order the Selling Dealer has retained from the investment by the
purchaser the amounts properly due to such Selling Dealer for such sale; all
in accordance with the then-effective prospectus and SAI for the particular
Series of the Trust.
2. Xxxxxxx shall have the sole authority to enter into agreements with
Selling Dealers, under which such Selling Dealers will provide shareholder
servicing and distribution services for the Trust. Xxxxxxx shall provide
Xxxxxx Square with advance notice of the identity of any dealer with which
Xxxxxxx proposes to enter into a Selling Dealer Agreement, and shall not
execute any such agreement until Xxxxxx Square has completed a suitable due
diligence evaluation of such dealer firm.
3. Xxxxxxx shall continue to be a member in good standing of the NASD,
and maintain its registration as a broker-dealer with the SEC and any other
state or jurisdiction in which it conducts business requiring such
registration in connection with sales of the Trust's shares.
4. Xxxxxxx shall pay to Xxxxxx Square, for Xxxxxx Square's services
under this Agreement, the sum of $12,000 per annum payable monthly, which
shall represent Xxxxxx Square's total remuneration under this Agreement, as
Xxxxxx Square will not receive 12b-1 Fees. In addition, Xxxxxxx shall
reimburse Xxxxxx Square for any out-of-pocket expenses incurred including, but
not limited to Section 11(b) hereof.
II. XXXXXX SQUARE
Xxxxxx Square, as co-underwriter and co-distributor, shall be responsible
for the following items under this Agreement:
A-1
1. Xxxxxx Square shall continue to be a member in good standing of the
NASD, and maintain its registration as a broker-dealer with the SEC, the 50
states, and the District of Columbia, so that Xxxxxx Square may lawfully be
listed as the broker of record in connection with sales of the Trusts shares,
and lawfully communicate with customers in the various jurisdictions with
respect to sales of the Trusts shares. Xxxxxx Square reserves the right to
hire a registered broker dealer acceptable to Xxxxxxx in any state where
Xxxxxx Square either becomes unqualified or is restricted from registration in
any such state at Xxxxxx Square's expense.
2. Xxxxxx Square shall inform Xxxxxxx of all inquiries from prospective
Selling Dealers who would consider entering into Selling Dealer Agreements
with Xxxxxxx. Xxxxxx Square shall perform on behalf of the National
Distributors a due diligence review with respect to the qualifications of
prospective Selling Dealers, and will prepare a report and recommendation with
respect to each prospective Selling Dealer's qualifications. Xxxxxx Square
shall, when it deems appropriate, advise Xxxxxxx not to enter into an
agreement with a prospective Selling Dealer, setting forth reasons therefor.
3. Xxxxxx Square shall review all fund-related advertising and sales
literature ("Advertising") for compliance with applicable regulations,
including the federal securities laws, and the NASD advertising rules. Xxxxxx
Square will also submit all Advertising to the NASD for pre-clearance or
approval, as appropriate, and shall provide Xxxxxxx with information about
such activities.
A-2
