DISTRIBUTING AGREEMENT
DISTRIBUTING AGREEMENT, dated as of January 1, 1993, between XXXXXXXX
CAPITAL FUND, INC., a Maryland corporation (the "Fund"), and XXXXXXXX FINANCIAL
SERVICES, INC., a Delaware corporation ("Xxxxxxxx Financial Services").
In consideration of the mutual agreements herein made, the parties
hereto agree as follows:
1. Exclusive Distributor. The Fund hereby agrees that Xxxxxxxx Financial
Services shall be for the period of this Agreement exclusive agent for
distribution within the United States and its territories, and Xxxxxxxx
Financial Services agrees to use its best efforts during such period to
effect such distribution of shares of Capital Stock ("Shares") of the Fund;
provided, however, that nothing herein shall prevent the Fund, if it so
elects, from selling or otherwise distributing its Shares directly to any
persons other than dealers. The Fund understands that Xxxxxxxx Financial
Services also acts as agent for distribution of the shares of capital stock
or beneficial interest of other open-end investment companies which have
entered into management agreements with J. & X. Xxxxxxxx & Co. Incorporated
(the "Manager").
2. Sales of Shares. Xxxxxxxx Financial Services is authorized, as agent for
the Fund and not as principal, (a) to sell Shares of the Fund to such
dealers as Xxxxxxxx Financial Services may select pursuant to the terms of
written sales agreements (which may also relate to sales of shares of
capital stock or shares of beneficial interest of other open-end investment
companies which have entered into management agreements with the Manager),
in form or forms approved by the Fund, and (b) to sell Shares of the Fund
to other purchasers on such terms as may be provided in the then current
prospectus of the Fund relating to such Shares; provided, however, that no
sales of Shares shall be confirmed by Xxxxxxxx Financial Services at any
time when, according to advice received by Xxxxxxxx Financial Services from
the Fund, the officers of the Fund have for any reason sufficient to them
temporarily or permanently suspended or discontinued the sale and issuance
of the Shares. Each sale of Shares shall be effected by Xxxxxxxx Financial
Services only at the applicable price determined by the Fund in the manner
prescribed in its then current prospectus relating to such Shares. Xxxxxxxx
Financial Services shall comply with all applicable laws, rules and
regulations including, without limiting the generality of the foregoing,
all rules or regulations made or adopted pursuant to Section 22 of the
Investment Company Act of 1940 (the "1940 Act") by the Securities and
Exchange Commission or any securities association registered under the
Securities Exchange Act of 1934.
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The Fund agrees, as long as its Shares may legally be issued, to fill all
orders confirmed by Xxxxxxxx Financial Services in accordance with the
provisions of this Agreement.
3. Repurchase Agent. Xxxxxxxx Financial Services is authorized, as agent for
the Fund and not as principal, to accept offers for resale to the Fund and
to repurchase on behalf of the Fund Shares of the Fund at net asset values
determined by the Fund in conformity with its then current prospectus
relating to such Shares.
4. Compensation. As compensation for the services of Xxxxxxxx Financial
Services under this Agreement, Xxxxxxxx Financial Services shall be
entitled to receive the sales charge, determined in conformity with the
Fund's then current prospectus relating to such Shares, on all sales of
Shares of the Fund confirmed by Xxxxxxxx Financial Services hereunder and
for which payment has been received, less the dealers' concession allowed
in respect of such sales. In addition, in accordance with the terms of the
Fund's Administration, Shareholder Services and Distribution Plan (the
"Plan"), the Fund may make payments from time to time to Xxxxxxxx Financial
Services in accordance with the terms and limitations of, and for the
purposes set forth in the Plan.
5. Expenses. Xxxxxxxx Financial Services agrees promptly to pay or reimburse
the Fund for all expenses (except expenses incurred by the Fund in
connection with the preparation, printing and distribution of any
prospectus or report or other communication to shareholders, to the extent
that such expenses are incurred to effect compliance with any Federal or
State law or to enable such distribution to shareholder(s) (a) of printing
and distributing copies of any prospectus and of preparing, printing and
distributing any other material used by Xxxxxxxx Financial Services in
connection with offering Shares of the Fund for sale, and (b) of
advertising in connection with such offering. The Fund agrees to pay all
expenses in connection with the registration of Shares of the Fund under
the Securities Act of 1933 (the "Act"), all fees and related expenses which
may be incurred in connection with the qualification of Shares of the Fund
for sale in such States (as well as the District of Columbia, Puerto Rico
and other territories) as Xxxxxxxx Financial Services may designate, and
all expenses in connection with maintaining facilities for the issue and
transfer of its Shares, of supplying information, prices and other data to
be furnished by it hereunder, and through Union Data Service Center, Inc.,
of all data processing and related services related to the share
distribution activity contemplated hereby.
The Fund agrees to execute such documents and to furnish such information
as may be reasonably necessary, in the discretion of the Directors of the
Fund, in connection with the qualification of Shares of the Fund for sale
in such States (as well as the District of Columbia, Puerto Rico and other
territories) as
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Xxxxxxxx Financial Services may designate. Xxxxxxxx Financial Services also
agrees to pay all fees and related expenses connected with its own
qualification as a broker or dealer under Federal or State laws and, except
as otherwise specifically provided in this Agreement or agreed to by the
Fund, all other expenses incurred by Xxxxxxxx Financial Services in
connection with the sale of Shares of the Fund as contemplated in this
Agreement (including the expenses of qualifying the Fund as a dealer or
broker under the laws of such States as may be designated by Xxxxxxxx
Financial Services, if deemed necessary or advisable by the Fund).
It is understood and agreed that any payments made to Xxxxxxxx Financial
Services pursuant to the Plan may be used to defray some or all of the
expenses incurred by Xxxxxxxx Financial Services pursuant to this
Agreement.
6. Prospectus and Other Information. The Fund represents and warrants to and
agrees with Xxxxxxxx Financial Services that:
(a) A registration statement, including one or more prospectuses relating
to the Shares, has been filed by the Fund under the Act and has become
effective. Such registration statement, as now in effect and as from
time to time hereafter amended, and also any other registration
statement relating to the Shares which may be filed by the Fund under
the Act which shall become effective, is herein referred to as the
"Registration Statement", and any prospectus or prospectuses filed by
the Fund as a part of the Registration Statement, as the "Prospectus".
(b) At all times during the term of this Agreement, except when the
officers of the Fund have suspended or discontinued the sale and
issuance of Shares of the Fund as contemplated by Section 2 hereof,
the Registration Statement and Prospectus will conform in all respects
to the requirements of the Act and the rules and regulations of the
Securities and Exchange Commission, and neither of such documents will
include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statement therein not misleading, except that the foregoing does not
apply to any statements or omissions in either of such documents based
upon written information furnished to the Fund by Xxxxxxxx Financial
Services specifically for use therein.
The Fund agrees to prepare and furnish to Xxxxxxxx Financial Services from
time to time a copy of its Prospectus, and authorizes Xxxxxxxx Financial
Services to use such Prospectus, in the form furnished to Xxxxxxxx
Financial Services from time to time, in connection with the sale of the
Fund's Shares. The Fund also agrees to furnish Xxxxxxxx Financial Services
from time to time,
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for use in connection with the sale of such Shares, such information with
respect to the Fund and its Shares as Xxxxxxxx Financial Services may
reasonably request.
7. Reports. Xxxxxxxx Financial Services will prepare and furnish to the
Directors of the Fund at least quarterly a written report complying with
the requirements of Rule 12b-1 under the 1940 Act setting forth all amounts
expended under the Plan and the purposes for which such expenditures were
made.
8. Indemnification. (a) The Fund will indemnify and hold harmless Xxxxxxxx
Financial Services and each person, if any, who controls Xxxxxxxx Financial
Services within the meaning of the Act against any losses, claims, damages
or liabilities to which Xxxxxxxx Financial Services or such controlling
person may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Fund's Registration Statement
or Prospectus or any other written sales material prepared by the Fund
which is utilized by Xxxxxxxx Financial Services in connection with the
sale of Shares or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
(in the case of the Registration Statement and Prospectus) necessary to
make the statements therein not misleading or (in the case of such other
sales material) necessary to make the statements therein not misleading in
the light of the circumstances under which they were made; and will
reimburse Xxxxxxxx Financial Services and each such controlling person for
any legal or other expenses reasonably incurred by Xxxxxxxx Financial
Services or such controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action; provided,
however, that the Fund will not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based
upon any untrue statement or alleged untrue statement or omission or
alleged omission made in such Registration Statement or Prospectus in
conformity with written information furnished to the Fund by Xxxxxxxx
Financial Services specifically for use therein; and provided, further,
that nothing herein shall be so construed as to protect Xxxxxxxx Financial
Services against any liability to the Fund or its security holders to which
Xxxxxxxx Financial Services would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence, in the performance of its
duties, or by reason of the reckless disregard by Xxxxxxxx Financial
Services of its obligations and duties under this Agreement. This indemnity
agreement will be in addition to any liability which the Fund may otherwise
have.
(b) Xxxxxxxx Financial Services will indemnify and hold harmless the Fund,
each of its Directors and officers and each person, if any, who
controls the Fund within
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the meaning of the Act, against any losses, claims, damages or
liabilities to which the Fund or any such Director, officer or
controlling person may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement or Prospectus or any sales material not
prepared by the Fund which is utilized in connection with the sale of
Shares or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated
therein or (in the case of the Registration Statement and Prospectus)
necessary to make the statements therein not misleading or (in the
case of such other sales material) necessary to make the statements
therein not misleading in the light of the circumstances under which
they were made, in the case of the Registration Statement and
Prospectus to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission
was made in conformity with written information furnished to the Fund
by Xxxxxxxx Financial Services specifically for use therein; and
Xxxxxxxx Financial Services will reimburse any legal or other expenses
reasonably incurred by the Fund or any such Director, officer or
controlling person in connection with investigating or defending any
such loss, claim, damage, liability or action. This indemnity
agreement will be in addition to any liability which Xxxxxxxx
Financial Services may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying
party under this Section, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying
party will not relieve it from liability which it may have to any
indemnified party otherwise than under this Section. In case any such
action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party
will be entitled to participate therein and, to the extent that it may
wish, to assume the defense thereof, with counsel satisfactory to such
indemnified party, and after notice from the indemnifying party to
such indemnified party of its election to assume the defense thereof,
the indemnifying party will not be liable to such indemnified party
under this Section for any legal or other expenses subsequently
incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
9. Effective Date. This Agreement shall become effective upon its execution by
an authorized officer of the respective parties to this Agreement, but in
no event prior to shareholder approval of the Plan.
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10. Term of Agreement. This Agreement shall continue in effect until December
31 of the year in which it is first effective and through December 31 of
each year thereafter if such continuance is approved in the manner required
by the 1940 Act and the rules thereunder and Xxxxxxxx Financial Services
shall not have notified the Fund in writing at least 60 days prior to the
anniversary date of the previous continuance that it does not desire such
continuance. This Agreement may be terminated at any time, without payment
of penalty on 60 days' written notice to the other party by vote of a
majority of the Directors of the Fund who are not interested persons (as
defined in the 0000 Xxx) of the Fund and have no direct or indirect
financial interest in the operation of the Plan or any agreement related
thereto, or by vote of a majority of the outstanding voting securities of
the Fund (as defined in the 1940 Act). This Agreement shall automatically
terminate in the event of its assignment (as defined in the 1940 Act).
11. Miscellaneous. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York. Anything herein to the
contrary notwithstanding, this Agreement shall not be construed to require,
or to impose any duty upon, either of the parties to do anything in
violation of any applicable laws or regulations.
IN WITNESS WHEREOF, the Fund and Xxxxxxxx Financial Services have caused
this Agreement to be executed by their duly authorized officers as of the date
first above written.
XXXXXXXX CAPITAL FUND, INC.
By __________________________________
Xxxxxx X. Xxxxxxxxx, President
XXXXXXXX FINANCIAL SERVICES, INC.
By __________________________________
Xxxxxx X. Xxxxx, President
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