XXXXX XXXXXX AGGRESSIVE GROWTH FUND INC.
DISTRIBUTION AGREEMENT
October 8, 1998
CFBDS, Inc.
00 Xxxx Xxxxxx
Xxxxxx, XX 00000
Dear Sirs:
This is to confirm that, in consideration of the agreements
hereinafter contained, the above-named investment company (the
"Fund") has agreed that you shall be, for the period of this
Agreement, the non-exclusive principal underwriter and distributor
of shares of the Fund. For purposes of this Agreement, the term
"Shares" shall mean shares of the each Series, or one or more
Series, as the context may require.
1. Services as Principal Underwriter and Distributor
1.1 You will act as agent for the distribution of
Shares covered by, and in accordance with, the registration
statement, prospectus and statement of additional information then
in effect under the Securities Act of 1933, as amended (the "1933
Act"), and the Investment Company Act of 1940, as amended (the
"1940 Act"), and will transmit or cause to be transmitted promptly
any orders received by you or those with whom you have sales or
servicing agreements for purchase or redemption of Shares to the
Transfer and Dividend Disbursing Agent for the Fund of which the
Fund has notified you in writing.
1.2 You agree to use your best efforts to solicit
orders for the sale of Shares. It is contemplated that you will
enter into sales or servicing agreements with registered securities
brokers and banks and into servicing agreements with financial
institutions and other industry professionals, such as investment
advisers, accountants and estate planning firms. In entering into
such agreements, you will act only on your own behalf as principal
underwriter and distributor. You will not be responsible for
making any distribution plan or service fee payments pursuant to
any plans the Fund may adopt or agreements it may enter into.
1.3 You shall act as the non-exclusive principal
underwriter and distributor of Shares in compliance with all
applicable laws, rules, and regulations, including, without
limitation, all rules and regulations made or adopted from time to
time by the Securities and Exchange Commission (the "SEC")
pursuant to the 1933 Act or the 1940 Act or by any securities
association registered under the Securities Exchange Act of 1934,
as amended.
1.4 Whenever in their judgment such action is
warranted for any reason, including, without limitation, market,
economic or political conditions, the Fund's officers may decline
to accept any orders for, or make any sales of, any Shares until
such time as those officers deem it advisable to accept such orders
and to make such sales and the Fund shall advise you promptly of
such determination.
2. Duties of the Fund
2.1 The Fund agrees to pay all costs and expenses
in connection with the registration of Shares under the 1933 Act,
and all expenses in connection with maintaining facilities for the
issue and transfer of Shares and for supplying information, prices
and other data to be furnished by the Fund hereunder, and all
expenses in connection with the preparation and printing of the
Fund's prospectuses and statements of additional information for
regulatory purposes and for distribution to shareholders; provided
however, that nothing contained herein shall be deemed to require
the Fund to pay any costs of advertising or marketing the sale of
Shares.
2.2 The Fund agrees to execute any and all
documents and to furnish any and all information and otherwise to
take any other actions that may be reasonably necessary in the
discretion of the Fund's officers in connection with the
qualification of Shares for sale in such states and other U.S.
jurisdictions as the Fund may approve and designate to you from
time to time, and the Fund agrees to pay all expenses that may be
incurred in connection with such qualification. You shall pay all
expenses connected with your own qualification as a securities
broker or dealer under state or Federal laws and, except as
otherwise specifically provided in this Agreement, all other
expenses incurred by you in connection with the sale of Shares as
contemplated in this Agreement.
2.3 The Fund shall furnish you from time to time,
for use in connection with the sale of Shares, such information
reports with respect to the Fund or any relevant Series and the
Shares as you may reasonably request, all of which shall be signed
by one or more of the Fund's duly authorized officers; and the Fund
warrants that the statements contained in any such reports, when so
signed by the Fund's officers, shall be true and correct. The Fund
also shall furnish you upon request with (a) the reports of the
annual audits of the financial statements of the Fund for each
Series made by independent certified public accountants
retained by the Fund for such purpose; (b) semi-annual unaudited
financial statements pertaining to each Series; (c) quarterly
earnings statements prepared by the Fund for any Series; (d) a
monthly itemized list of the securities in each Series' portfolio;
(e) monthly balance sheets as soon as practicable after the end of
each month; (f) the current net asset value and offering price
per share for each Series on each day such net asset value is
computed and (g) from time to time such additional information
regarding the financial condition of each Series of the Fund as you
may reasonably request.
3. Representations and Warranties
The Fund represents to you that all registration statements,
prospectuses and statements of additional information filed by the
Fund with the SEC under the 1933 Act and the 1940 Act with respect
to the Shares have been prepared in conformity with the
requirements of said Acts and the rules and regulations of the SEC
thereunder. As used in this Agreement, the terms "registration
statement", "prospectus" and "statement of additional information"
shall mean any registration statement, prospectus and statement of
additional information filed by the Fund with the SEC and any
amendments and supplements thereto filed by the Fund with the SEC.
The Fund represents and warrants to you that any such registration
statement, prospectus and statement of additional information, when
such registration statement becomes effective and as such
prospectus and statement of additional information are amended and
supplemented, includes at the time of such effectiveness, amendment
or supplement all statements required to be contained therein in
conformance with the 1933 Act, the 1940 Act and the rules and
regulations of the SEC; that all statements of material fact
contained in any registration statement, prospectus or statement of
additional information will be true and correct when such
registration statement becomes effective; and that neither any
registration statement nor any prospectus or statement of
additional information when such registration statement becomes
effective will include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading to a
purchaser of the Fund's Shares. The Fund 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 or statement of additional
information as, in the light of future developments, may, in the
opinion of the Fund, be necessary or advisable. If the Fund shall
not propose such amendment or amendments and/or supplement or
supplements within fifteen days after receipt by the Fund of a
written request from you to do so, you may, at your option,
terminate this Agreement or decline to make offers of the Fund's
Shares until such amendments are made. The Fund shall not file any
amendment to any registration statement or supplement to any
prospectus or statement of additional information without giving
you reasonable notice thereof in advance; provided, however, that
nothing contained in this Agreement shall in any way limit the
Fund's right to file at any time such amendments to any
registration statement and/or supplements to any prospectus or
statement of additional information, of whatever character, as the
Fund may deem advisable, such right being in all respects absolute
and unconditional.
4. Indemnification
4.1 The Fund authorizes you to use any prospectus
or statement of additional information furnished by the Fund from
time to time, in connection with the sale of Shares. The Fund
agrees to indemnify, defend and hold you, your several officers and
directors, and any person who controls you within the meaning of
Section 15 of the 1933 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 such counsel fees incurred in connection
therewith) which you, your officers and directors, or any such
controlling person, may incur under the 1933 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, any prospectus or any
statement of additional information or arising out of or based upon
any omission, or alleged omission, to state a material fact
required to be stated in any registration statement, any prospectus
or any statement of additional information or necessary to make the
statements in any of them not misleading; provided, however, that
the Fund's agreement to indemnify you, your officers or directors,
and any such controlling person shall not be deemed to cover any
claims, demands, liabilities or expenses arising out of any
statements or representations made by you or your representatives
or agents other than such statements and representations as are
contained in any prospectus or statement of additional information
and in such financial and other statements as are furnished to you
pursuant to paragraph 2.3 of this Agreement; and further provided
that the Fund's agreement to indemnify you and the Fund's
representations and warranties herein before set forth in paragraph
3 of this Agreement shall not be deemed to cover any liability to
the Fund or its shareholders to which you would otherwise be
subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of your duties, or by reason of your
reckless disregard of your obligations and duties under this
Agreement. The Fund's agreement to indemnify you, your officers
and directors, and any such controlling person, as aforesaid, is
expressly conditioned upon the Fund's being notified of any action
brought against you, your officers or directors, or any such
controlling person, such notification to be given by letter or by
telegram addressed to the Fund at its principal office in New York,
New York and sent to the Fund by the person against whom such
action is brought, within ten days after the summons or other first
legal process shall have been served. The failure so to notify the
Fund of any such action shall not relieve the Fund from any
liability that the Fund may have to the person against whom such
action is brought by reason of any such untrue, or alleged untrue,
statement or omission, or alleged omission, otherwise than on
account of the Fund's indemnity agreement contained in this
paragraph 4.1. The Fund 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 Fund. In the event the Fund elects to
assume the defense of any such suit and retains counsel of good
standing, the defendant or defendants in such suit shall bear the
fees and expenses of any additional counsel retained by any of
them; but if the Fund does not elect to assume the defense of any
such suit, the Fund will reimburse you, your officers and
directors, or the controlling person or persons named as defendant
or defendants in such suit, for the reasonable fees and expenses of
any counsel retained by you or them. The Fund's indemnification
agreement contained in this paragraph 4.1 and the Fund'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 you, your officers and
directors, or any controlling person, and shall survive the
delivery of any of the Fund's Shares. This agreement of indemnity
will inure exclusively to your benefit, to the benefit of your
several officers and directors, and their respective estates, and
to the benefit of the controlling persons and their successors.
The Fund agrees to notify you promptly of the commencement of any
litigation or proceedings against the Fund or any of its officers
or Board members in connection with the issuance and sale of any of
the Fund's Shares.
4.2 You agree to indemnify, defend and hold the
Fund, its several officers and Board members, and any person who
controls the Fund within the meaning of Section 15 of the 1933 Act,
free and harmless 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) that the Fund, its officers or
Board members or any such controlling person may incur under the
1933 Act, or under common law or otherwise, but only to the extent
that such liability or expense incurred by the Fund, its officers
or Board members, 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 you to the Fund and used in the
answers to any of the items of the registration statement or in the
corresponding statements made in the prospectus or statement of
additional information, 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 you to the
Fund and required to be stated in such answers or necessary to make
such information not misleading. Your agreement to indemnify the
Fund, its officers or Board members, and any such controlling
person, as aforesaid, is expressly conditioned upon your being
notified of any action
brought against the Fund, its officers or Board members, or any
such controlling person, such notification to be given by letter or
telegram addressed to you at your principal office in Boston,
Massachusetts and sent to you by the person against whom such
action is brought, within ten days after the summons or other first
legal process shall have been served. You shall have the right to
control the defense of such action, with counsel of your own
choosing, satisfactory to the Fund, if such action is based solely
upon such alleged misstatement or omission on your part or with the
Fund's consent, and in any event the Fund, its officers or Board
members or such controlling person shall each have the right to
participate in the defense or preparation of the defense of any
such action with counsel of its own choosing reasonably acceptable
to you but shall not have the right to settle any such action
without your consent, which will not be unreasonably withheld. The
failure to so notify you of any such action shall not relieve you
from any liability that you may have to the Fund, its officers or
Board members, 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 your indemnity agreement
contained in this paragraph 4.2. You agree to notify the Fund
promptly of the commencement of any litigation or proceedings
against you or any of your officers or directors in connection with
the issuance and sale of any of the Fund's Shares.
5. Effectiveness of Registration
No Shares shall be offered by either you or the Fund under
any of the provisions of this Agreement and no orders for the
purchase or sale of such Shares under this Agreement shall be
accepted by the Fund 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 1933
Act, or if and so long as a current prospectus as required by
Section 5(b) (2) of the 1933 Act is not on file with the SEC;
provided, however, that nothing contained in this paragraph 5 shall
in any way restrict or have any application to or bearing upon the
Fund's obligation to repurchase its Shares from any shareholder in
accordance with the provisions of the Fund's prospectus, statement
of additional information or charter documents, as amended from
time to time.
6. Offering Price
Shares of any class of any Series of the Fund offered for
sale by you shall be offered for sale at a price per share (the
"offering price") equal to (a) their net asset value (determined
in the manner set forth in the Fund's charter documents and the
then-current prospectus and statement of additional information)
plus (b) a sales charge, if applicable, which shall be the
percentage of the offering price of such Shares as set forth in the
Fund's then-current prospectus relating to such Series. In
addition to or in lieu of any sales charge applicable at the time
of sale, Shares of any class of any Series of the Fund offered for
sale by you may be subject to a contingent deferred sales charge as
set forth in the Fund's then-current prospectus and statement of
additional information. You shall be entitled to receive any sales
charge levied at the time of sale in respect of the Shares without
remitting any portion to the Fund. Any payments to a broker or
dealer through whom you sell Shares shall be governed by a separate
agreement between you and such broker or dealer and the Fund's
then-current prospectus and statement of additional information.
Any payments to any provider of services to you shall be governed
by a separate agreement between you and such service provider.
7. Notice to You
The Fund agrees to advise you immediately in writing:
(a) of any request by the
SEC for amendments to the
registration statement,
prospectus or statement of
additional information then in
effect or for additional
information;
(b) in the event of the
issuance by the SEC of any stop
order suspending the
effectiveness of the registration
statement, prospectus or
statement of additional
information then in effect or the
initiation 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,
prospectus or statement of
additional information then in
effect or that requires the
making of a change in such
registration statement,
prospectus or statement of
additional information in order
to make the statements therein
not misleading; and
(d) of all actions of the
SEC with respect to any amendment
to the registration statement, or
any supplement to the prospectus
or statement of additional
information which may from time
to time be filed with the SEC.
8. Term of the Agreement
This Agreement shall become effective on the date hereof,
shall have an initial term of one year from the date hereof, and
shall continue for successive annual periods thereafter so long as
such continuance is specifically approved at least annually by (a)
the Fund's Board or (b) by a vote of a majority (as defined in the
0000 Xxx) of the Fund's outstanding voting securities, provided
that in either event the continuance is also approved by a majority
of the Board members of the Fund who are not interested persons (as
defined in the 0000 Xxx) of any party to this Agreement, by vote
cast in person at a meeting called for the purpose of voting on
such approval. This Agreement is terminable with or without cause,
without penalty, on 60 days' notice by the Fund's Board or by vote
of holders of a majority of the relevant Series outstanding voting
securities, or on 90 days' notice by you. This Agreement will also
terminate automatically, as to the relevant Series, in the event of
its assignment (as defined in the 1940 Act and the rules and
regulations thereunder).
9. Arbitration
Any claim, controversy, dispute or deadlock arising
under this Agreement (collectively, a "Dispute") shall be settled
by arbitration administered under the rules of the American
Arbitration Association ("AAA") in New York, New York. Any
arbitration and award of the arbitrators, or a majority of them,
shall be final and the judgment upon the award rendered may be
entered in any state or federal court having jurisdiction. No
punitive damages are to be awarded.
10. Miscellaneous
So long as you act as a principal underwriter and
distributor of Shares, you shall not perform any services for any
entity other than investment companies advised or administered by
Citigroup Inc. or its subsidiaries. The Fund recognizes that the
persons employed by you to assist in the performance of your duties
under this Agreement may not devote their full time to such service
and nothing contained in this Agreement shall be deemed to limit or
restrict the persons employed by you or any of your affiliates
right to engage in and devote time and attention to other
businesses or to render services of whatever kind or nature,
provided, however, that in conducting such business or rendering
such services your employees and affiliates would take reasonable
steps to assure that the other parties involved are put on notice
as to the legal entity with which they are dealing. This Agreement
and the terms and conditions set forth herein shall be governed by,
and construed in accordance with, the laws of the State of New York
without giving effect to its conflict of interest principles.
If the foregoing is in accordance with your understanding,
kindly indicate your acceptance of this Agreement by signing and
returning to us the enclosed copy, whereupon this Agreement will
become binding on you.
Very truly yours,
XXXXX XXXXXX AGGESSIVE GROWTH
FUND INC.
By:
_____________________
Authorized
Officer
Accepted:
CFBDS, INC.
By: __________________________
Authorized Officer
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