EXHIBIT 6
DISTRIBUTION AGREEMENT
AGREEMENT made this 1st day of October, 1996, between XXXXXXX FUND, INC.
(the "Company"), a Maryland corporation having its principal place of business
at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, and BISYS FUND SERVICES LIMITED
PARTNERSHIP d/b/a BISYS FUND SERVICES ("Distributor"), having its principal
place of business at 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000.
WHEREAS, the Company is an open-end management investment company,
organized as a Maryland corporation and registered with the Securities and
Exchange Commission (the "Commission") under the Investment Company Act of 1940,
as amended (the "1940 Act"); and
WHEREAS, it is intended that Distributor act as the distributor of the
units of beneficial interest ("Shares") of each of the investment portfolios of
the Company (such portfolios being referred to individually as a "Fund" and
collectively as the "Funds").
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein set forth, the parties agree as follows:
1. SERVICES AS DISTRIBUTOR; CONVERSION TO THE SERVICES.
1.1 Distributor (i) will act as agent for the distribution of the
Shares covered by the registration statement and prospectus of the Company
then in effect under the Securities Act of 1933, as amended (the
"Securities Act") and (ii) will perform such additional services as are
provided in this Section 1 (collectively, the "Services"). In connection
therewith, the Company agrees to convert to the Distributor's data
processing systems and software (the "BISYS System"). The Company shall
cooperate with the Distributor to provide the Distributor with all
necessary information and assistance required to successfully convert to
the BISYS System. The Distributor shall provide the Company with a schedule
relating to such conversion and the parties agree that the conversion may
progress in stages. The date upon which all Services shall have been
converted to the BISYS System shall be referred to herein as the
"Conversion Date." The Distributor hereby accepts such engagement and
agrees to perform the Services commencing, with respect to each individual
Service, on the date that the conversion of such Service to the BISYS
System has been completed. The Distributor shall determine in accordance
with its normal acceptance procedures when the applicable Service has been
successfully converted. As used in this Agreement, the term "registration
statement" shall mean Parts A (the prospectus), B (the Statement of
Additional Information) and C of each registration statement that is filed
on Form N-1A, or any successor thereto, with the Commission, together with
any amendments thereto. The term "prospectus" shall mean each form of
prospectus and Statement of Additional Information used by the Funds for
delivery to shareholders and prospective shareholders after the effective
dates of the above-referenced registration statements, together with any
amendments and supplements thereto.
1.2 Distributor agrees to use appropriate efforts to solicit orders
for the sale of the Shares and will undertake such advertising and
promotion as it believes reasonable in connection with such solicitation.
The Company understands that Distributor is now and may in the future be
the distributor of the shares of several investment companies or series
(together, "Investment Companies") including Companies having investment
objectives similar to those of the Company. The Company further understands
that investors and potential investors in the Company may invest in shares
of such other Investment Companies. The Company agrees that Distributor's
duties to such Investment Companies shall not be deemed in conflict with
its duties to the Company under this paragraph 1.2.
Distributor shall, at its own expense, finance appropriate activities
which it deems reasonable, which are primarily intended to result in the
sale of the Shares, including, but not limited to, advertising,
compensation of underwriters, dealers and sales personnel, the printing and
mailing of prospectuses to other than current Shareholders, and the
printing and mailing of sales literature.
1.3 In its capacity as distributor of the Shares, all activities of
Distributor and its partners, agents, and employees shall comply with all
applicable laws, rules and regulations, including, without limitation, the
1940 Act, all rules and regulations promulgated by the Commission
thereunder and all rules and regulations adopted by any securities
association registered under the Securities Exchange Act of 1934.
1.4 Distributor will provide one or more persons, during normal
business hours, to respond to telephone questions with respect to the
Company.
1.5 Distributor will transmit any orders received by it for purchase
or redemption of the Shares to the transfer agent and custodian for the
Funds.
1.6 Whenever in their judgment such action is warranted by unusual
market, economic or political conditions, or by abnormal circumstances of
any kind, the Company's officers may decline to accept any orders for, or
make any sales of, the Shares until such time as those officers deem it
advisable to accept such orders and to make such sales.
1.7 Distributor will act only on its own behalf as principal if it
chooses to enter into selling agreements with selected dealers or others.
1.8 The Company agrees at its own expense to execute any and all
documents and to furnish any and all information and otherwise to take all
actions that may be reasonably necessary in connection with the
qualification of the Shares for sale in such states as Distributor may
designate.
1.9 The Company shall furnish from time to time, for use in connection
with the sale of the Shares, such information with respect to the Funds and
the Shares as Distributor may reasonably request; and the Company warrants
that the statements contained in any such information shall fairly show or
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represent what they purport to show or represent. The Company shall also
furnish Distributor upon request with: (a) unaudited semi-annual statements
of the Funds' books and accounts prepared by the Company, (b) a monthly
itemized list of the securities in the Funds, (c) monthly balance sheets as
soon as practicable after the end of each month, and (d) from time to time
such additional information regarding the financial condition of the Funds
as Distributor may reasonably request.
1.10 The Company represents to Distributor that, with respect to the
Shares, all registration statements and prospectuses filed by the Company
with the Commission under the Securities Act have been carefully prepared
in conformity with requirements of said Act and rules and regulations of
the Commission thereunder. The registration statement and prospectus
contain all statements required to be stated therein in conformity with
said Act and the rules and regulations of said Commission and all
statements of fact contained in any such registration statement and
prospectus are true and correct. Furthermore, neither any registration
statement nor any prospectus includes an untrue statement of a material
fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading to a purchaser of
the Shares. 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 that are deemed necessary or advisable by
the Company's counsel within fifteen days after receipt by the Company of a
written request from Distributor to do so, Distributor may, at its option,
terminate this Agreement. The Company shall not file any amendment to any
registration statement or supplement to any prospectus without giving
Distributor 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 supplements to any prospectus, of whatever character, as the Company
may deem advisable, such right being in all respects absolute and
unconditional.
1.11 The Company authorizes Distributor and dealers to use any
prospectus in the form furnished from time to time in connection with the
sale of the Shares. The Company agrees to indemnify, defend and hold
Distributor, its several partners and employees, and any person who
controls Distributor within the meaning of Section 15 of the Securities Act
free and harmless from and against any and all claims, demands, liabilities
and expenses (including the cost of investigating or defending such claims,
demands or liabilities and any counsel fees incurred in connection
therewith) which Distributor, its partners and employees, or any such
controlling person, may incur under the Securities Act or under common law
or otherwise, arising out of or based upon any untrue statement, or alleged
untrue statement, of a material fact contained in any registration
statement or any prospectus or arising out of or based upon any omission,
or alleged omission, to state a material fact required to be stated in
either any registration statement or any prospectus or necessary to make
the statements in either thereof not misleading; provided, however, that
the Company's agreement to indemnify Distributor, its partners or
employees, and any such controlling person shall not be deemed to cover any
claims, demands, liabilities or expenses arising out of any statements or
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representations as are contained in any prospectus and in such financial
and other statements as are furnished in writing to the Company by
Distributor and used in the answers to the registration statement or in the
corresponding statements made in the prospectus, or arising out of or based
upon any omission or alleged omission to state a material fact in
connection with the giving of such information required to be stated in
such answers or necessary to make the answers not misleading; and further
provided that the Company's agreement to indemnify Distributor and the
Company's representations and warranties hereinbefore set forth in
paragraph 1.10 shall not be deemed to cover any liability to the Company or
its Shareholders to which Distributor would otherwise be subject by reason
of willful misfeasance, bad faith or gross negligence in the performance of
its duties, or by reason of Distributor's reckless disregard of its
obligations and duties under this Agreement. The Company's agreement to
indemnify Distributor, its partners and employees and any such controlling
person, as aforesaid, is expressly conditioned upon the Company being
notified of any action brought against Distributor, its partners or
employees, or any such controlling person, such notification to be given by
letter or by telegram addressed to the Company at its principal office in
Columbus, Ohio and sent to the Company by the person against whom such
action is brought, within 10 days after the summons or other first legal
process shall have been served. The failure to so notify the Company of any
such action shall not relieve the Company from any liability which the
Company may have to the person against whom such action is brought by
reason of any such untrue, or allegedly untrue, statement or omission, or
alleged omission, otherwise than on account of the Company's indemnity
agreement contained in this paragraph 1.11. The Company will be entitled to
assume the defense of any suit brought to enforce any such claim, demand or
liability, but, in such case, such defense shall be conducted by counsel of
good standing chosen by the Company and approved by Distributor, which
approval shall not be unreasonably withheld. In the event the Company
elects to assume the defense of any such suit and retain counsel of good
standing approved by Distributor, the defendant or defendants in such suit
shall bear the fees and expenses of any additional counsel retained by any
of them; but in case the Company does not elect to assume the defense of
any such suit, or in case Distributor reasonably does not approve of
counsel chosen by the Company, the Company will reimburse Distributor, its
partners and employees, or the controlling person or persons named as
defendant or defendants in such suit, for the fees and expenses of any
counsel retained by Distributor or them. The Company's indemnification
agreement contained in this paragraph 1.11 and the Company's
representations and warranties in this Agreement shall remain operative and
in full force and effect regardless of any investigation made by or on
behalf of Distributor, its partners and employees, or any controlling
person, and shall survive the delivery of any Shares.
This Agreement of indemnity will inure exclusively to Distributor's
benefit, to the benefit of its several partners and employees, and their
respective estates, and to the benefit of the controlling persons and their
successors. The Company agrees promptly to notify Distributor of the
commencement of any litigation or proceedings against the Company or any of
its officers or Directors in connection with the issue and sale of any
Shares.
1.12 Distributor agrees to indemnify, defend and hold the Company, its
several officers and Directors and any person who controls the Company
within the meaning of Section 15 of the Securities Act free and harmless
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from and against any and all claims, demands, liabilities and expenses
(including the costs of investigating or defending such claims, demands, or
liabilities and any counsel fees incurred in connection therewith) which
the Company, its officers or Directors or any such controlling person, may
incur under the Securities Act or under common law or otherwise, but only
to the extent that such liability or expense incurred by the Company, its
officers or Directors or such controlling person resulting from such claims
or demands, 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 Distributor to the Company and used in the answers to any of the
items of the registration statement or in the corresponding statements made
in the prospectus, or shall arise out of or be based upon any omission, or
alleged omission, to state a material fact in connection with such
information furnished in writing by Distributor to the Company required to
be stated in such answers or necessary to make such information not
misleading. Distributor's agreement to indemnify the Company, its officers
and Directors, and any such controlling person, as aforesaid, is expressly
conditioned upon Distributor being notified of any action brought against
the Company, its officers or Directors, or any such controlling person,
such notification to be given by letter or telegram addressed to
Distributor at its principal office in Columbus, Ohio, and sent to
Distributor by the person against whom such action is brought, within 10
days after the summons or other first legal process shall have been served.
Distributor shall have the right of first control of the defense of such
action, with counsel of its own choosing, satisfactory to the Company, if
such action is based solely upon such alleged misstatement or omission on
Distributor's part, and in any other event the Company, its officers or
Directors or such controlling person shall each have the right to
participate in the defense or preparation of the defense of any such
action. The failure to so notify Distributor of any such action shall not
relieve Distributor from any liability which Distributor may have to the
Company, its officers or Directors, or to such controlling person by reason
of any such untrue or alleged untrue statement, or omission or alleged
omission, otherwise than on account of Distributor's indemnity agreement
contained in this paragraph 1.12.
1.13 No Shares shall be offered by either Distributor or the Company
under any of the provisions of this Agreement and no orders for the
purchase or sale of Shares hereunder shall be accepted by the Company if
and so long as the effectiveness of the registration statement then in
effect or any necessary amendments thereto shall be suspended under any of
the provisions of the Securities Act or if and so long as a current
prospectus as required by Section 10(b)(2) of said Act is not on file with
the Commission; provided, however, that nothing contained in this paragraph
1.13 shall in any way restrict or have an application to or bearing upon
the Company's obligation to repurchase Shares from any Shareholder in
accordance with the provisions of the Company's prospectus, Articles of
Incorporation, or Bylaws.
1.14 The Company agrees to advise Distributor as soon as reasonably
practical by a notice in writing delivered to Distributor or its counsel:
(a) of any request by the Commission for amendments to the
registration statement or prospectus then in effect or for
additional information;
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(b) in the event of the issuance by the Commission of any stop
order suspending the effectiveness of the registration
statement or prospectus then in effect or the initiation by
service of process on the Company of any proceeding for that
purpose;
(c) of the happening of any event that 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 action of the Commission with respect to any
amendment to any registration statement or prospectus which
may from time to time be filed with the Commission.
For purposes of this section, informal requests by or acts of the
Staff of the Commission shall not be deemed actions of or requests by the
Commission.
1.15 Distributor agrees on behalf of itself and its partners and employees
to treat confidentially and as proprietary information of the Company all
records and other information relative to the Company and its prior, present or
potential Shareholders, and not to use such records and information for any
purpose other than performance of its responsibilities and duties hereunder,
except, after prior notification to and approval in writing by the Company,
which approval shall not be unreasonably withheld and may not be withheld where
Distributor may be exposed to civil or criminal contempt proceedings for failure
to comply, when requested to divulge such information by duly constituted
authorities, or when so requested by the Company.
1.16 This Agreement shall be governed by the laws of the State of Ohio.
2. PUBLIC OFFERING PRICE.
The public offering price of the Company's Shares shall be the net asset
value of such Shares. The net asset value of Shares shall be determined in
accordance with the provisions of the Articles of Incorporation and By-Laws of
the Company and the then-current prospectuses of the Company's Funds.
3. TERM, DURATION AND TERMINATION.
The initial term of this Agreement (the "Initial Term") shall be for a
period commencing on the date this Agreement is executed by both parties and
ending on the date that is one year after such date. Thereafter, if not
terminated, this Agreement shall continue with respect to a particular Fund
automatically for successive one-year terms, provided that such continuance is
specifically approved at least annually by the vote of the Company's Board of
Directors or the vote of a majority of the outstanding voting securities of such
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Fund. This Agreement will also terminate automatically in the event of its
assignment. (As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested persons" and "assignment" shall have the same
meanings as ascribed to such terms in the 1940 Act.)
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 written
above.
XXXXXXX FUND, INC. BISYS FUND SERVICES
LIMITED PARTNERSHIP
By: BISYS Fund Services, Inc.
General Partner
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxxxxx Xxxxxx
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Xxxx X. Xxxxxxx Xxxxxxx Xxxxxx
Title: President and Treasurer Title: Executive Vice President
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