EXHIBIT 6
XXXXXXXX-XXXXXXXXX MUTUAL FUNDS
DISTRIBUTION AGREEMENT
This DISTRIBUTION AGREEMENT (this "Agreement") is made as of this __
day of ____________, 1996 by and between Xxxxxxxx-Xxxxxxxxx Series Trust, a
Delaware business trust (the "Trust"), and Xxxxxxxx-Xxxxxxxxx Securities, a
California limited partnership (the "Distributor").
WHEREAS, the Trust is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Trust currently consists of six series (each a "Series"
and collectively the "Series");
WHEREAS, Xxxxxxxx-Xxxxxxxxx Capital Management, an affiliate of the
Distributor, has agreed to act as investment adviser to the Trust;
WHEREAS, the Distributor is a broker-dealer registered under the
Securities Exchange Act of 1934, as amended, and a member of the National
Association of Securities Dealers, Inc. (the "NASD");
WHEREAS, the Trust desires to retain the Distributor as its agent to
provide services in connection with the distribution of shares of beneficial
interest ("shares") of each of the Series, and the Distributor is willing to
provide such services upon the terms set forth herein;
NOW, THEREFORE, for good and valuable consideration, receipt of which
is hereby acknowledged, the parties hereto agree as follows:
Section 1. APPOINTMENT OF DISTRIBUTOR.
The Trust hereby appoints the Distributor as its agent to act as the
principal underwriter and distributor of shares of the Series, and the
Distributor hereby accepts such appointment and agrees to act hereunder. The
Trust hereby agrees during the term of this Agreement to sell shares of the
Series exclusively to or through the Distributor on the terms and conditions set
forth below.
In the event that the Trust establishes one or more series other than
the Series with respect to which it desires to appoint the Distributor as the
principal underwriter and distributor hereunder, it will notify the Distributor
in writing. If the Distributor is willing to accept such appointment under this
Agreement it will so notify the Trust in writing, whereupon such series will be
subject to the provisions of this Agreement to the same extent as the Series
except to the extent that such provisions (including those relating to the
compensation payable by the Trust to the Distributor) are modified with respect
to such series in writing by the Trust and the Distributor at the time.
Section 2. SALE OF SHARES.
2.1 The Distributor shall have the right to sell as agent for the
Trust the shares of a Series needed, but not more than the shares needed, to
fill unconditional orders for shares placed with the Distributor by registered
separate accounts of insurance companies.
2.2 The shares of the Series are to be sold by the Distributor, as
described in Section 5 hereof, to investors at the offering price as set forth
in the applicable prospectus and statement of additional information for the
Series then in effect (the "Prospectus").
2.3 The Trust shall have the right to suspend the sale of its shares
at times when redemption is suspended pursuant to the conditions in Section 3.3
hereof or at such other times as may be determined by the Trust's Board of
Trustees (the "Board").
2.4 The Trust, or any agent of the Trust designated in writing by the
Board, shall be promptly advised of all purchase orders for shares of the Series
received by the Distributor. Any order may be rejected by the Trust or the
Distributor; provided, however, that the Trust and the Distributor will not
arbitrarily or without reasonable cause refuse to accept or confirm orders for
the purchase of shares of a Series. The Trust (or its agent) will confirm
orders upon their receipt, will make appropriate book entries and, upon receipt
by the Trust (or its agent) of payment therefor, will deliver deposit receipts
for the shares pursuant to the instructions of the Distributor. Payment shall
be made to the Trust (or its agent) in New York Clearing House funds or federal
funds.
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The Distributor agrees to cause such payment and such instructions to be
delivered promptly to the Trust (or its agent).
Section 3. REDEMPTION OF SHARES BY THE TRUST.
3.1 Any of the outstanding shares of a Series may be tendered for
redemption at any time, and the Trust agrees to repurchase or redeem the shares
so tendered in accordance with the Trust's Declaration of Trust and Bylaws and
the applicable provisions of the respective Series' Prospectus. The price to be
paid to redeem or repurchase the shares shall be equal to the net asset value
per share determined as set forth in the applicable Prospectus (the "redemption
price"). All payments by the Trust hereunder shall be made in the manner set
forth in Section 3.2 below.
3.2 The Trust (or its agent) shall pay the total amount of the
redemption price pursuant to the instructions of the Distributor on or before
the seventh calendar day subsequent to the Trust (or its agent) having received
the notice of redemption in proper form. The proceeds of any redemption of
shares shall be paid by the Trust (or its agent) to or for the account of the
redeeming shareholder, in each case in accordance with the applicable provisions
of the respective Series' Prospectus.
3.3 Redemption of shares or payment therefor may be suspended at
times when the New York Stock Exchange is closed for other than customary
weekends and holidays, when trading on the Exchange is restricted, when an
emergency exists as a result of which disposal by the Trust of securities owned
by it is not reasonably practicable or when it is not reasonably practicable for
the Trust fairly to determine the value of its net assets, or during any other
period when the Securities and Exchange Commission, by order, so permits.
Section 4. DUTIES OF THE TRUST.
4.1 Subject to the possible suspension of the sale of shares of a
Series, and the right to reject orders, as provided herein, the Trust agrees to
sell shares of the Series so long as shares are available for sale.
4.2 The Trust (or its agent) shall furnish the Distributor copies of
all information, financial statements and other documents which the Distributor
may reasonably request for use in connection with the distribution of
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shares, which information shall include one certified copy, upon request by the
Distributor, of all financial statements prepared for the Trust by its
independent public accountants. The Trust (or its agent) shall make available
to the Distributor such number of copies of the Prospectuses for each Series and
annual and interim reports as the Distributor shall reasonably request.
4.3 The Trust shall use its best efforts to take from time to time,
but subject to the necessary approval of the Board and the shareholders, all
necessary action to register authorized shares under the Securities Act of 1933,
as amended (the "1933 Act"), so that there will be available for sale such
number of shares of the Series as the Distributor reasonably may expect to sell.
The Trust shall file from time to time such amendments, reports and other
documents as may be necessary in order that there will be no untrue statement of
a material fact in the Trust's Registration Statement on Form N-1A covering the
shares of the Series (the "Registration Statement"), or necessary in order that
there will be no omission to state a material fact in the Registration Statement
which omission would make the statements therein misleading. The Distributor
shall furnish such information and other material relating to its affairs and
activities as may be required by the Trust in connection with such Registration
Statement.
4.4 The Trust shall use its best efforts to qualify and maintain the
qualification of an appropriate number of shares of the Series for sale under
the securities laws of such states as the Distributor and the Trust may approve;
provided that the Trust shall not be required to amend its Declaration of Trust
or Bylaws to comply with the laws of any state, to maintain an office in any
state, to change the terms of the offering of its shares in any state from the
terms set forth in its Registration Statement, to qualify as a foreign
corporation in any state or to consent to service of process in any state other
than with respect to claims arising out of the offering of its shares. Any such
qualification may be withheld, terminated or withdrawn by the Trust at any time
in its discretion. As provided in Section 7 hereof, the expense of
qualification and maintenance of qualification shall be borne by the Trust. The
Distributor shall furnish such information and other material relating to its
affairs and activities as may be required by the Trust in connection with such
qualifications.
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Section 5. DUTIES OF THE DISTRIBUTOR.
5.1 The Distributor shall devote reasonable time and effort to effect
sales of shares of the Series, but shall not be obligated to sell any specific
number of shares. Sales of shares of a Series shall be on the terms described
in its Prospectus. To the extent not otherwise provided herein, the Distributor
shall bear all of the costs and expenses it incurs in fulfilling its obligations
hereunder.
5.2 In selling shares of the Series, the Distributor shall use its
best efforts in all respects duly to conform with the requirements of all
federal and state laws relating to the sale of such securities. Neither the
Distributor nor any other person is authorized by the Trust to give any
information or to make any representations, other than those contained in the
Registration Statement or applicable Prospectus for the respective Series and
any sales literature approved by appropriate officers of the Trust.
5.3 The Distributor shall adopt and follow procedures for the
confirmation of sales to investors, the collection of amounts payable by
investors on such sales and the cancellation of unsettled transactions, as may
be necessary to comply with the requirements established by the NASD.
5.4 The Distributor shall be the exclusive distributor of shares of
the Series appointed by the Trust; however, the Distributor is an independent
contractor and may enter into like arrangements with other investment companies.
Section 6. PAYMENTS TO THE DISTRIBUTOR.
The Distributor shall receive no compensation from the Trust in
connection with sales and redemptions of shares of the Series.
Section 7. ALLOCATION OF EXPENSES.
The Trust shall bear all costs and expenses of the continuous offering
of shares of the Series, including fees and disbursements of its counsel and
auditors, in connection with the preparation and filing of any required
registration statements and/or prospectuses under the 1940 Act or the 1933 Act,
and preparing and mailing annual and periodic
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reports and proxy materials to shareholders (including but not limited to the
expense of typesetting any such registration statements, prospectuses, annual or
periodic reports or proxy materials). The Trust shall also bear the costs and
expenses of qualifying the shares for sale, and, if necessary or advisable in
connection therewith, of qualifying the Trust as a broker or dealer, in such
states or other jurisdictions as shall be selected by the Trust and the
Distributor pursuant to Section 4.4 hereof, and the cost and expense payable to
each such state for continuing qualification therein until the Trust decides to
discontinue such qualification pursuant to Section 4.4 hereof.
Section 8. INDEMNIFICATION.
8.1 The Trust agrees to indemnify, defend and hold the Distributor,
its partners and officers, and any person who controls the Distributor 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 counsel
fees incurred in connection therewith) which the Distributor, its partners and
officers 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 of a
material fact contained in the Registration Statement or Prospectuses for any of
the Series or arising out of or based upon any alleged omission to state a
material fact required to be stated in the Registration Statement or
Prospectuses or necessary to make the statements therein not misleading, except
insofar as such claims, demands, liabilities or expenses arise out of or are
based upon any such untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with information furnished in
writing by the Distributor to the Trust for use in the Registration Statement or
Prospectuses; provided, however, that this indemnity agreement shall not inure
to the benefit of any such partner, officer or controlling person unless a court
of competent jurisdiction shall determine, in a final decision on the merits,
that the person to be indemnified was not liable 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 under this Agreement
("disabling conduct"), or, in the absence of such a decision, a reasonable
determination, based upon a review of the facts, that the indemnified person was
not liable by reason of disabling conduct by (a) a vote of a
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majority of a quorum of Trustees of the Trust who are neither "interested
persons" of the Trust as defined in Section 2(a)(19) of the 1940 Act nor parties
to the proceeding, or (b) an independent legal counsel in a written opinion.
The Trust's agreement to indemnify the Distributor, its partners and officers
and any such controlling person as aforesaid is expressly conditioned upon the
Trust's being promptly notified of any action brought against the Distributor,
its partners, officers or any such controlling person. The Trust agrees
promptly to notify the Distributor of the commencement of any litigation or
proceedings against it or any of its officers or Trustees in connection with the
issue and sale of any shares.
8.2 The Distributor agrees to indemnify, defend and hold the Trust,
its officers and Trustees and any person who controls the Trust, if any, 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 against such claims, demands or liabilities and any
counsel fees incurred in connection therewith) which the Trust, its officers and
Trustees 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 Trust, its Trustees or officers or such controlling person
resulting from such claims or demands shall arise out of or be based upon any
alleged untrue statement of a material fact contained in information furnished
in writing by the Distributor to the Trust for use in the Registration Statement
or Prospectuses for any of the Series or shall arise out of or be based upon any
alleged omission to state a material fact in connection with such information
required to be stated in the Registration Statement or Prospectuses or necessary
to make such information not misleading. The Distributor's agreement to
indemnify the Trust, its officers and Trustees and any such controlling person
as aforesaid, is expressly conditioned upon the Distributor's being promptly
notified of any action brought against the Trust, its officers and Trustees or
any such controlling person.
8.3 The Distributor acknowledges that it has received a copy of the
Declaration of Trust of the Trust dated July 20, 1995. The Distributor further
acknowledges and agrees that the obligations of the Trust under this Agreement
are not binding on any officers, trustees or shareholders of the Trust
individually, but are only binding upon the assets and properties of the Trust.
Moreover, the
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Declaration of Trust of the Trust provides that the debts, liabilities,
obligations and expenses incurred, contracted for or otherwise existing with
respect to a Series shall be enforceable against the assets and property of such
Series only, and not against the assets and property of any other Series of the
Trust.
Section 9. DURATION AND TERMINATION OF THIS AGREEMENT.
9.1 This Agreement shall become effective with respect to a Series
as of the date first above written and shall remain in force for two years from
the date hereof and thereafter, but only so long as such continuance is
specifically approved at least annually by (a) the Board, or by the vote of a
majority of the outstanding voting securities of the shares of the Series, and
(b) by the vote of a majority of those Trustees of the Trust who are not parties
to this Agreement or interested persons of any such parties (the "Disinterested
Trustees"), cast in person at a meeting called for the purpose of voting upon
such approval.
9.2 This Agreement may be terminated with respect to a Series at any
time, without the payment of any penalty, by a majority of the Disinterested
Trustees or by vote of a majority of the outstanding voting securities of the
Series, or by the Distributor, on not less than sixty (60) days' written notice
to the other party. This Agreement shall automatically terminate in the event
of its assignment.
9.3 The terms "affiliated person," "assignment," "interested person"
and "vote of a majority of the outstanding voting securities," when used in this
Agreement, shall have the respective meanings specified in the 1940 Act.
Section 10. AMENDMENTS TO THIS AGREEMENTS.
This Agreement may be amended with respect to a Series by the parties
only if such amendment is specifically approved by (a) the Board, or by the vote
of a majority of the outstanding voting securities of the Series and (b) by the
vote of a majority of the Disinterested Trustees cast in person at a meeting
called for the purpose of voting on such amendment.
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Section 11. GOVERNING LAW.
The provisions of this Agreement shall be construed and interpreted in
accordance with the internal laws (and not the laws of conflicts of law) of the
State of California as at the time in effect and the applicable provisions of
the 1940 Act. To the extent that the applicable law of the State of California,
or any of the provisions herein, conflict with the applicable provisions of the
1940 Act, the latter shall control.
Section 12. MISCELLANEOUS.
12.1 Notices of any kind to be given to the Distributor by the Trust
shall be in writing and shall be duly given if mailed, delivered or communicated
by answer back facsimile transmission to the Distributor at 000 Xxxx Xxxxxxxx,
00xx Xxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000, Facsimile: (000) 000-0000, Attention:
President, or at such other address or to such individual as shall be so
specified by the Distributor. Notices of any kind to be given to the Trust
hereunder by the Distributor shall be in writing and will be duly given if
mailed, delivered or so communicated to the Trust at 000 Xxxx Xxxxxxxx, 00xx
Xxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000, Facsimile: (000) 000-0000, Attention:
President, or at such other address or to such individual as shall be so
specified by the Trust to the Distributor.
12.2 This Agreement constitutes the entire agreement and
understanding between the parties hereto, and supersedes all prior agreements
and understandings relating to the subject matter hereof.
12.3 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.
12.4 If any provision of this Agreement is held or made invalid by a
court decision, statute, rule or
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otherwise, the remainder of this Agreement shall not be affected thereby.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year above written.
XXXXXXXX-XXXXXXXXX MUTUAL FUNDS
By:
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E. Xxxxx Xxxxx, Jr.
Its: Secretary
XXXXXXXX-XXXXXXXXX SECURITIES
By: Xxxxxxxx-Xxxxxxxxx Capital
Management Holdings, L.P.
Its General Partner
By: Xxxxxxxx-Xxxxxxxxx Capital
Management Holdings, Inc.
Its General Partner
By:
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E. Xxxxx Xxxxx, Jr.
Its: Secretary
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