XXXXX & XXXX DISTRIBUTORS, INC.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
FORM OF
PRIVATE CLASS SUB-DISTRIBUTION AND SERVICE AGREEMENT
Xxxxx & Tang Distributors, Inc. ("R&T") serves as distributor of the money
market funds listed in Exhibit A (the "Funds"). These funds are Maryland
corporations. The Funds are open-end investment companies registered under the
Investment Company Act of 1940, as amended (the "Investment Company Act"). The
Funds propose to offer [a class or classes] of shares of each Fund, $.001 par
value, to be offered to clients of MetLife Securities, Inc. ("MetLife") (the
"MetLife Shares"), in accordance with the terms and conditions contained in a
separate prospectus and the related Statement of Additional Information (the
"SAI") of each of the Funds. Xxxxx & Xxxx Asset Management, LLC (the "Manager")
serves as manager for the Funds. The terms "Prospectus" and "SAI" as used herein
refer to the separate prospectus or related Statement of Additional Information
of each class of each Fund on file with the Securities and Exchange Commission
which is part of the most recent registration statement effective from time to
time under the Securities Act of 1933, as amended (the "Securities Act").
In connection with the offering of MetLife Shares to the public,
MetLife may place or facilitate the placement of orders for purchase and
redemption of MetLife Shares for and on behalf of customers of MetLife on the
following terms and conditions:
1. Services. (a) MetLife is hereby authorized to provide distribution
assistance to R&T in connection with the sale of MetLife Shares and to (i) place
orders through R&T for purchases of MetLife Shares and (ii) tender MetLife
Shares through R&T for redemption, in each case subject to the terms and
conditions set forth in each Prospectus and SAI.
(b) MetLife agrees to provide certain shareholder servicing activities (as
listed in Exhibit B) for customers of MetLife (the "Customers") who have
purchased MetLife Shares.
2. Compensation. In consideration of the services and facilities provided
by MetLife hereunder, R&T will pay or cause the Funds to pay an annual fee to
MetLife equal to the total expense ratio of each of the MetLife Shares of each
Fund less (i) 16 basis points on the first $500 million, 14 basis points on the
next $500 million, 12 basis points on the next $500 million and 10 basis points
for assets over $1.5 billion on the average daily net assets of each class of
the MetLife Shares of each Fund held from time to time by or on behalf of the
Customers (the "Customers' Fund Shares") and (ii) total external fund expenses
(currently estimated at 7 basis point) including but not limited to fees to the
custodian, transfer agent, attorneys, fund directors, auditors, bookkeepers,
taxes, bluesky, and printing of prospectuses, semi-annual and annual reports.
The
fee for each Fund for such services will be computed [daily] and payable
monthly. For purposes of determining the fees payable under this computation,
the average daily net asset value of the Customers' Fund Shares will be computed
in the manner specified in each Fund's registration statement (as the same is in
effect from time to time) in connection with the computation of the net asset
value of MetLife Shares for purposes of purchases and redemptions. [R&T or the
Funds may, in its discretion and without notice, suspend or withdraw the sale of
MetLife Shares, including the sale of such MetLife Shares to MetLife for the
account of any Customers]. R&T represents to MetLife that this Agreement and the
payment of such service and distribution fees by R&T and the Funds have been
authorized and approved by the Funds.
3. Compliance With Law. MetLife agrees that it will comply with the
provisions contained in the Securities Act governing the distribution of
Prospectuses to persons to whom MetLife offers MetLife Shares, and, if
requested, will deliver SAIs. MetLife further agrees that it will deliver, upon
request, copies of any amended Prospectus (and SAI) to Customers whose MetLife
Shares MetLife is holding as record owner and to deliver to such Customers
copies of the annual and interim financial reports and proxy solicitation
materials of the Funds. R&T agrees to furnish to MetLife as many copies of the
Prospectus and SAI, annual and interim financial reports and proxy solicitation
materials as you may reasonably request.
4. Representations. MetLife represents that it is a member in good standing
of the National Association of Securities Dealers, Inc. MetLife agrees that it
will not offer MetLife Shares to persons in any jurisdiction in which MetLife
may not lawfully make such offer due to the fact that MetLife has not registered
under, or is not exempt from, the applicable registration or licensing
requirements of such jurisdiction.
5. Registration and Qualification of Shares. The Funds have registered an
indefinite number of MetLife Shares under the Securities Act. In addition, the
Funds have filed Articles Supplementary with the State of Maryland to reflect
the creation of the MetLife class of shares. Upon application, R&T will inform
MetLife as to the states or other jurisdictions in which R&T believes the
MetLife Shares have been qualified for sale under, or are exempt from the
requirements of, the respective securities laws of such states, but R&T shall
assume no responsibility or obligation as to MetLife's right to sell MetLife
Shares in any jurisdiction.
6. Authority. Each Fund shall have full authority to take such action as it
deems advisable in respect of all matters pertaining to the offering of the
MetLife Shares, including the right in its discretion, without notice, to
suspend sales or withdraw the offering of MetLife Shares entirely.
7. Recordkeeping. MetLife understands and agrees that MetLife, and not R&T,
the Manager or the Funds, shall be responsible for obtaining and maintaining
taxpayer certifications under applicable law, including the satisfaction of any
penalties imposed for failure to obtain and maintain such information under and
in accordance with applicable law with respect to accounts
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established by MetLife. MetLife also agrees that it will (i) maintain all
records required by law relating to transactions in MetLife Shares and, upon
request by the Funds, promptly make such of these records available to the Funds
as the Funds may reasonably request in connection with its operations; and (ii)
promptly notify R&T if MetLife experiences any difficulty in maintaining the
records described in the foregoing clauses in an accurate and complete manner.
8. Liability. R&T and the Funds shall be under no liability to MetLife
except for lack of good faith and for obligations expressly assumed by them
hereunder. In carrying out R&T's obligations, R&T agrees to act in good faith
and without negligence. Nothing contained in this agreement is intended to
operate as a waiver by R&T, the Manager and the Funds or MetLife of compliance
with any provision of the Investment Company Act, the Securities Act, the
Securities Exchange Act of 1934, as amended, or the rules and regulations
promulgated by the Securities and Exchange Commission thereunder.
9. Indemnification. For all purposes of this Agreement MetLife will be
deemed to be an independent contractor and will have no authority to act as
agent for R&T or the Funds in any manner or in any respect, other than as
specifically set forth herein and in the exhibits hereto. By MetLife's and R&T's
written acceptance of this Agreement, MetLife and R&T (as the case may be,
"Indemnifying Party") each agree to and do release, indemnify, defend and hold
the other (in each case, the "Indemnified Party") harmless from and against any
and all direct and indirect liabilities or losses (including without limitation
reasonable court costs and attorneys' fees) resulting from any directions,
actions or inactions of the Indemnifying Party or its officers, employees, or
agents, except, however, to the extent arising from the negligence, bad faith or
willful wrongdoing of the Indemnified Party or its officers, employees, or
agents regarding its responsibilities hereunder. This paragraph shall survive
the termination of this Agreement.
10. Effective Date and Term. This Agreement is effective on the date hereof
and shall extend from the date of the initial purchases of MetLife Class Shares
of a Fund to [ YEAR PERIOD], (the "Initial Term"). Following the Initial Term,
this Agreement shall automatically renew upon the mutual agreement of both
parties for a subsequent term of one (1) year each year thereafter and may be
terminated without penalty by either party upon [six (6)] months' written notice
to the other party. [ R&T may terminate this agreement at any time upon notice,
including during the Initial Term, if the aggregate average assets of the Funds
listed on Exhibit A fall below $[ ] million unless MetLife pays to R&T a minimum
fee of [$ ] per month.]
11. Termination. Notwithstanding any provision to the contrary contained
herein, this Agreement shall automatically terminate in the event of its
assignment, as defined in the Investment Company Act. This Agreement may also be
terminated at any time for any reason or no reason without penalty by the vote
of a majority of the members of the Board of Directors of a Fund who are not
"interested persons" (as such phrase is defined in the Investment Company
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Act) and have no direct or indirect financial interest in the operation of the
plan of distribution with respect to the MetLife Shares and any related
agreement, or by the vote of a majority of the outstanding voting securities of
the MetLife Shares of a Fund.
12. Representations and Sales Materials. No person is authorized to make
any representations concerning the Funds or the MetLife Shares except those
contained in each Prospectus and SAI and in such printed information as R&T may
subsequently prepare. No person is authorized to distribute any sales material
relating to the Funds without the prior written approval of R&T.
13. Arbitration. Any dispute, controversy, or claim arising out of,
connected with, or relating to this Agreement, or the breach, validity, or
enforceability of any provision of this Agreement, will be resolved by final and
binding arbitration in accordance with and subject to the Commercial Arbitration
Rules of the American Arbitration Association ("AAA") then in effect.
Arbitration shall take place at a location within the state of New York, or at a
location at the discretion of the arbitrators. All expenses associated with
obtaining and utilizing the services of the AAA and the arbitrators shall be
shared equally by the parties hereto. The AAA and the arbitrators shall be made
aware of this provision and shall agree to request payment separately from R&T
and MetLife for said services, including all expenses directly related to the
arbitration, other than the expense of witnesses, which shall be borne by the
party producing such witnesses.
Notwithstanding the foregoing, R&T and MetLife shall bear their own
respective costs of preparing for and participating in the arbitration,
including, without limitation, their attorneys' fees, expert and/or witness
fees, and their costs of complying with discovery requests. Discovery as
permitted by the Federal Rules of Civil Procedure then in effect will be allowed
in connection with the arbitration to the extent consistent with the purpose of
the arbitration and as allowed by the arbitrators. Judgment upon the award
rendered in any arbitration may be entered in any court of competent
jurisdiction, or application may be made to such court for a judicial acceptance
of the award and an enforcement, as the law of the state having jurisdiction may
require or allow. The fact that arbitration is or may be allowed will not impair
the exercise of any termination rights under this Agreement.
14. Waiver. No failure or delay by either party to exercise any right of
such party regarding an obligation of the other party to this Agreement shall
operate as a waiver thereof, unless agreed to in writing by both parties. Any
single or partial exercise by either party of any of its rights shall not
preclude such party from any other or further exercise of any such right or the
exercise of any other right. Any single or partial waiver by either party of any
obligation of the other party under this Agreement shall constitute a waiver of
such obligation only as specified in such waiver and shall not constitute a
waiver of any other obligation.
15. Amendment. This Agreement cannot be changed, modified or amended,
except by an instrument in writing executed by all parties hereto.
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16. Choice of Law; Entire Agreement. This Agreement shall be governed by
and shall be interpreted in accordance with the laws of the State of New York.
This Agreement, including any attachments or exhibits hereto, supersedes any and
all prior written or oral agreements between the parties, and hereby constitutes
the entire Agreement between the parties with respect to the subject matter
hereof, and may only be amended in writing signed by authorized officers of the
parties.
17. Notice. Any notice or other communication given under this Agreement to
either party shall be in writing, delivered by hand or through the United States
Postal Service, registered or certified mail with return receipt requested to
the following individuals' attention (or to such other individuals and/or
addresses as may be set forth in a written notice sent by either party, as
applicable):
Notices to R&T and to any of the Funds:
Attention: Xxxxxxx Xxxxxxx
Title: Senior Vice President
FAX number: (000) 000-0000
Address: 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Notices to Met Life Securities, Inc.:
Attention:
Title:
FAX number: ( ) -
Address:
The parties agree that proper notice given to R&T constitutes notice to R&T
and each and all of the Funds.
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Please indicate your confirmation and acceptance of this Agreement by signing
below and returning two copies of this agreement to Xxxxx & Xxxx Distributors,
Inc., 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000.
Xxxxx & Tang Distributors, Inc.
_________________________, 2002
by: ______________________________
Xxxxxxx Xx Xxxxxxx
Vice President, CFO & Treasurer
MetLife Securities, Inc.
_________________________, 2002
by:________________________________
Name:________________________________
Title:________________________________
EXHIBIT A
Cortland Trust, Inc. - Cortland General Money Market Fund
EXHIBIT B
Services to be Performed
Omnibus Fund Account
1. Maintain customer account detail for Fund shares held as agent for
customers.
2. Issue and deliver periodic statements to customers.
3. Break down daily dividend accruals and apply them to customer account
records.
4. Receive, break down and pay or, at customers' direction, consolidate and
reinvest customer dividends on monthly payment date.
5. Consolidate and remit to the Fund customer monies associated with their
purchase of Fund shares.
6. Receive from the Fund, break down and remit to customer monies associated
with their redemptions of Fund shares.
7. Maintain all proof procedures between customer sub-accounts and the central
account with the Fund.
8. Perform all special mailings to customers required by the Fund, such as
annual prospectuses mailings, proxy solicitations, and semi-annual and
annual reports.
9. Perform all customer service functions for the Fund, including responding
to telephone inquiries and requests.
10. Fill all customer requests for prospectuses.
11. Receive and process customer registration forms.
12. Retain records regarding the services to be performed, as required by law
and regulations.
13. Transmit to customers and governmental authorities all IRS reporting.
