Exhibit 6
XXXXXXX MUTUAL FUNDS, INC.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
August 22, 1988
Xxxxxxx Fund Distributors, Inc.
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Underwriting Agreement
Dear Sirs:
Xxxxxxx Mutual Funds, Inc. (hereinafter called the "Company") is a
corporation organized under the laws of Maryland and is engaged in the business
of an investment company. The authorized capital of the Company consists of
3,000,000,000 shares of capital stock, with $.0l par value ("Shares"), currently
of one class; however, there has been established a series of stock of the
Company known as the "Xxxxxxx Gold Fund", and the Shares may be divided into
additional series of the Company that may be established from time to time by
action of the Directors. The Company has selected you to act as principal
underwriter (as such term is defined in Section 2(a)(29) of the Investment
Company Act of 1940, as amended (the "1940 Act")) of the Shares and you are
willing to act as such principal underwriter and to perform the duties and
functions of underwriter in the manner and on the terms and conditions
hereinafter set forth. Accordingly, the Company hereby agrees with you as
follows:
1. Delivery of Documents. The Company has furnished you with copies
properly certified or authenticated of each of the following:
(a) Articles of Incorporation of the Company, dated March 17, 1988.
(b) By-Laws of the Company as in effect on the date hereof.
(c) Resolutions of the Board of Directors of the Company selecting you as
principal underwriter and approving the form of this Agreement.
The Company will furnish you from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing, if any.
The Company will furnish you promptly with properly certified or
authenticated copies of any registration statement filed by it with the
Securities and Exchange Commission under the Securities Act of 1933, as amended
(the "1933 Act"), or the 1940 Act, together with any financial statements and
exhibits included therein, and all amendments of supplements thereto hereafter
filed.
2. Registration and Sale of Additional Shares. The Company will from time
to time use its best efforts to register under the 1933 Act such number of
Shares not already so registered as you may reasonably be expected to sell on
behalf of the Company. You and the Company will cooperate in taking such action
as may be necessary from time to time to qualify Shares so registered for sale
by you or the Company in any states mutually agreeable to you and the Company,
and to maintain such qualification. This Agreement relates to the issue and sale
of Shares that are duly authorized and registered and available for sale by the
Company, including redeemed or repurchased Shares if and to the extent that they
may be legally sold and if, but only if, the Company sees fit to sell them.
3. Sale of Shares. Subject to the provisions of paragraphs 5 and 7 hereof
and to such minimum purchase requirements as may from time to time be currently
indicated in the Company's prospectus or prospectuses or statement or statements
of additional information, you are authorized to sell as agent on behalf of the
Company Shares authorized for issue and registered under the 1933 Act. You may
also purchase as principal Shares for resale to the public. Such sales will be
made by you on behalf of the Company by accepting unconditional orders to
purchase Shares placed with you by investors and such purchases will be made by
you only after acceptance by you of such orders. The sales price to the public
of Shares shall be the public offering price as defined in paragraph 6 hereof.
4. Solicitation of Orders. You will use your best efforts (but only in
states in which you may lawfully do so) to obtain from investors unconditional
orders for Shares authorized for issue by the Company and registered under the
1933 Act, provided that you may in your discretion refuse to accept orders for
Shares from any particular applicant.
5. Sale of Shares by the Company. Unless you are otherwise notified by the
Company, any right granted to you to accept orders for Shares or to make sales
on behalf of the Company or to purchase Shares for resale will not apply to (i)
Shares issued in connection with the merger or consolidation of
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any other investment company with the Company or its acquisition, by purchase or
otherwise, of all or Substantially all of the assets of any investment company
or substantially all the outstanding shares of any such company, and (ii) to
Shares that may be offered by the Company to shareholders of the Company by
virtue of their being such shareholders.
6. Public Offering Price. All Shares sold to investors by you will be sold
at the public offering price. The public offering price for all accepted
subscriptions will be the net asset value per Share, determined, in the manner
provided in the Company's registration statement as from time to time in effect
under the 1933 Act and the 1940 Act, next after the order is accepted by you.
7. Suspension of Sales. If and whenever the determination of net asset
value is suspended and until such suspension is terminated, no further orders
for Shares shall be accepted by you except unconditional orders placed with you
before you had knowledge of the suspension. In addition, the Company reserves
the right to suspend sales and your authority to accept orders for Shares on
behalf of the Company if, in the judgment of a majority of the Board of
Directors or a majority of the Executive Committee of such Board, if such body
exists, it is in the best interests of the Company to do so, such suspension to
continue for such period as may be determined by such majority; and in that
event, no Shares will be sold by you on behalf of the Company while such
suspension remains in effect except for Shares necessary to cover unconditional
orders accepted by you before you had knowledge of the suspension.
8. Portfolio Securities. Portfolio securities of the Company may be bought
or sold by or through you and you may participate directly or indirectly in
brokerage commissions or "spread" in respect of transactions in portfolio
securities of the Company; provided, however, that all sums of money received by
you as a result of such purchases and sales or as a result of such participation
must, after reimbursement of your actual expenses in connection with such
activity, be paid over by you to or for the benefit of the Company.
9. Expenses. (a) The Company will pay (or will enter into arrangements
providing that others than you will pay) all fees and expenses:
(1) in connection with the preparation, setting in type and filing of
any registration statement (including a prospectus or
prospectuses and statement or statements of
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additional information) under the 1933 Act or the 1940 Act, or
both, and any amendments or supplements thereto that may be made
from time to time;
(2) in connection with the registration and qualification of Shares
for sale in the various jurisdictions in which the Company shall
determine it advisable to qualify such Shares for sale (including
registering the Company as a broker or dealer or any officer of
the Company or other person as agent or salesman of the Company
in any such jurisdictions);
(3) of preparing, setting in type, printing and mailing any notice,
proxy statement, report, prospectus, statement of additional
information or other communication to shareholders of the Company
in their capacity as such;
(4) of preparing, setting in type, printing and mailing prospectuses
annually, and any supplements thereto, to existing shareholders;
(5) in connection with the issue and transfer of Shares resulting
from the acceptance by you of orders to purchase Shares placed
with you by investors, including the expenses of printing and
mailing confirmations of such purchase orders and the expenses of
printing and mailing a prospectus included with the confirmation
of such orders;
(6) of any issue taxes or any initial transfer taxes;
(7) of WATS (or equivalent) telephone lines other than the portion
allocated to you in this paragraph 9;
(8) of wiring funds in payment of Share purchases or in satisfaction
of redemption or repurchase requests, unless such expenses are
paid for by the investor or shareholder who initiates the
transaction;
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(9) of the cost of printing and postage of business reply envelopes
sent to Company shareholders;
(10) of one or more CRT terminals connected with the computer
facilities of the Company's transfer agent other than the portion
allocated to you in this paragraph 9;
(11) permitted to be paid or assumed by the Company pursuant to a plan
("12b-1 Plan"), if any, adopted by the Company in conformity with
the requirements of Rule 12b-1 under the 1940 Act ("Rule 12b-l")
or any successor rule, notwithstanding any other provision to the
contrary herein;
(12) of setting in type, printing and postage of the periodic
newsletter to shareholders other than the portion allocated to
you in this paragraph 9; and
(13) of the salaries and overhead of persons employed by you as
shareholder representatives other than the portion allocated to
you in this paragraph 9.
(b) You shall pay or arrange for the payment of all fees and expenses:
(1) of printing and distributing any prospectuses, statements of
additional information or reports prepared for your use in
connection with the offering of Shares to the public;
(2) of preparing, setting in type, printing and mailing any other
literature used by you in connection with the offering of Shares
to the public;
(3) of advertising in connection with the offering of Shares to the
public;
(4) incurred in connection with your registration as a broker or
dealer or the registration or qualification of your officers,
directors, agents or representatives under Federal and state
laws;
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(5) of that portion of WATS (or equivalent) telephone lines,
allocated to you on the basis of use by investors (but not
shareholders) who request information, prospectuses or statements
of additional information;
(6) of that portion of the expense of setting in type, printing and
postage of the periodic newsletter to shareholders attributable
to promotional material included in such newsletter at your
request concerning investment companies other than the Company or
concerning the Company to the extent you are required to assume
the expense thereof pursuant to paragraph 9(b)(8), except such
material which is limited to information, such as listings of
other investment companies and their investment objectives, given
in connection with the exchange privilege as from time to time
described in the Company's prospectus or prospectuses;
(7) of that portion of the salaries and overhead of persons employed
by you as shareholder representatives attributable to the time
spent by such persons in responding to requests from investors,
but not shareholders, for information about the Company;
(8) of any activity which is primarily intended to result in the sale
of Shares, unless a 12b-l Plan shall be in effect which provides
that the Company shall bear some or all of such expenses, in
which case the Company shall bear such expenses in accordance
with such Plan; and
(9) of that portion of one or more CRT terminals connected with the
computer facilities of the Company's transfer agent attributable
to your use of such terminal(s) to gain access to such of the
transfer agent's records as also serve as your records.
Expenses which are to be allocated between you and the Company shall be
allocated pursuant to reasonable procedures or formulae mutually agreed upon
from time to time, which procedures or formulae shall to the extent practicable
reflect studies of relevant empirical data.
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10. Conformity with Law. You agree that in selling Shares you will duly
conform in all respects with the laws of the United States and any state in
which Shares may be offered for sale by you pursuant to this Agreement and to
the rules and regulations of the National Association of Securities Dealers,
Inc., of which you are a member.
11. Independent Contractor. You shall be an independent contractor and
neither you nor any of your officers or employees is or shall be an employee of
the Company in the performance of your duties hereunder. You shall be
responsible for your own conduct and the employment, control and conduct of your
agents and employees and for injury to such agents or employees or to others
through your agents or employees. You assume full responsibility for your agents
and employees under applicable statutes and agree to pay all employee taxes
thereunder.
12. Indemnification. You agree to indemnify and hold harmless the Company
and each of its Directors and officers and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act, against any and all
losses, claims, damages, liabilities or litigation (including legal and other
expenses) to which the Company or such Directors, officers, or controlling
person may become subject under such Act, under any other statute, at common law
or otherwise, arising out of the acquisition of any Shares by any person which
(i) may be based upon any wrongful act by you or any of your employees or
representatives, or (ii) may be based upon any untrue statement or alleged
untrue statement of a material fact contained in a registration statement
(including a prospectus or statement of additional information) covering Shares
or any amendment thereof or supplement thereto or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statement therein not misleading if such statement or
omission was made in reliance upon information furnished to the Company by you,
or (iii) may be incurred or arise by reason of your acting as the Company's
agent instead of purchasing and reselling Shares as principal in distributing
the Shares to the public, provided, however, that in no case (i) is your
indemnity in favor of a Director or officer or any other person deemed to
protect such Director or officer or other person against any liability to which
any such person would otherwise be subject by reason of willful misfeasance, bad
faith, or gross negligence in the performance of his duties or by reason of his
reckless disregard of obligations and duties under this Agreement or (ii) are
you to be liable under your indemnity agreement contained in this paragraph with
respect to any claim made against the Company or any person indemnified unless
the
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Company or such person, as the case may be, shall have notified you in writing
within a reasonable time after the summons or other first legal process giving
information on the nature of the claims shall have been served upon the Company
or upon such person (or after the Company or such person shall have received
notice of such service on any designated agent), but failure to notify you of
any such claim shall not relieve you from any liability which you may have to
the Company or any person against whom such action is brought otherwise than on
account of your indemnity agreement contained in this paragraph, You shall be
entitled to participate, at your own expense, in the defense, or, if you so
elect, to assume the defense of any suit brought to enforce any such liability,
but if you elect to assume the defense, such defense shall be conducted by
counsel chosen by you and satisfactory to the Company, to its officers and
Directors, or to any controlling person or persons, defendant or defendants in
the suit. In the event that you elect to assume the defense of any such suit and
retain such counsel, the Company, such officers and Directors or controlling
person or persons, defendant or defendants in the suit shall bear the fees and
expenses of any additional counsel retained by them, but, in case you do not
elect to assume the defense of any such suit, you will reimburse the Company,
such officers and Directors or controlling person or persons, defendant or
defendants in such suit for the reasonable fees and expenses of any counsel
retained by them. You agree promptly to notify the Company of the commencement
of any litigation or proceedings against it in connection with the issue and
sale of any of the Shares.
The Company agrees to indemnify and hold harmless you and each of your
directors and officers and each person, if any, who controls you within the
meaning of Section 15 of the 1933 Act, against any and all losses, claims,
damages, liabilities or litigation (including legal and other expenses) to which
you or such directors, officers or controlling person may become subject under
such Act, under any other statute, at common law or otherwise, arising out of
the acquisition of any Shares by any person which (i) may be based upon any
wrongful act by the Company or any of its employees or representatives, or (ii)
may be based upon any untrue statement or alleged untrue statement of a material
fact contained in a registration statement (including a prospectus or statement
of additional information) covering Shares or any amendment thereof or
supplement thereto or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading if such statement or omission was made in reliance upon
information furnished to you by the Company; provided, however, that in no case
(i) is the Company's indemnity in favor of a director or
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officer or any other person deemed to protect such director or officer or other
person against any liability to which any such person would otherwise be subject
by reason of willful misfeasance, bad faith, or gross negligence in the
performance of his duties or by reason of his reckless disregard of obligations
and duties under this Agreement or (ii) is the Company to be liable under its
indemnity agreement contained in this paragraph with respect to any claims made
against you or any such director, officer or controlling person unless you or
such director, officer or controlling person, as the case may be, shall have
notified the Company in writing within a reasonable time after the summons or
other first legal process giving information of the nature of the claim shall
have been served upon you or upon such director officer or controlling person
(or after you or such director, officer or controlling person shall have
received notice of such service on any designated agent), but failure to notify
the Company of any such claim shall not relieve it from any liability which it
may have to the person against whom such action is brought otherwise than on
account of its indemnity agreement contained in this paragraph. The Company will
be entitled to participate at its own expense in the defense, or, if it so
elects, to assume the defense of any suit brought to enforce any such liability,
but if the Company elects to assume the defense, such defense shall be conducted
by counsel chosen by it and satisfactory to you, your directors, officers or
controlling person or persons, defendant or defendants in the suit. In the event
that the Company elects to assume the defense of any such suit and retain such
counsel, you, your directors, officers or controlling person or persons,
defendant or defendants in the suit, shall bear the fees and expenses of any
additional counsel retained by them, but, in case the Company does not elect to
assume the defense of any such suit, it will reimburse you or such directors,
officers or controlling person or persons, defendant or defendants in the suit,
for the reasonable fees and expenses of any counsel retained by them. The
Company agrees promptly to notify you of the commencement of any litigation or
proceedings against it or any of its officers or Directors in connection with
the issuance or sale of any Shares.
13. Authorized Representations. The Company is not authorized to give any
information or to make any representations on behalf of you other than the
information and representations contained in a registration statement (including
a prospectus or statement of additional information) covering Shares, as such
registration statement and prospectus or prospectuses may be amended or
supplemented from time to time.
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You are not authorized to give any information or to make any
representations on behalf of the Company or in connection with the sale of
Shares other than the information and representat4ons contained in a
registration statement (including a prospectus or statement of additional
information) covering Shares, as such registration statement and prospectus or
prospectuses may be amended or supplemented from time to time. No person other
than you is authorized to act as principal underwriter (as such term is defined
in the 0000 Xxx) for the Company.
14. Duration and Termination of this Agreement. This Agreement shall become
effective upon the date first written above and will remain in effect until
August 22, 1990 and from year to year thereafter, but only so long as such
continuance is specifically approved at least annually by the vote of a majority
of the Directors who are not interested persons of you or of the Company cast in
person at a meeting called for the purpose of voting on such approval, and by
vote of the Board of Directors or of a majority of the outstanding voting
securities of the relevant series of the Shares. This Agreement may, on 60 days'
written notice, be terminated, with respect to the Company or any series of the
Shares, as the case may be, at any time without the payment of any penalty, by
the Board of Directors of the Company, by a vote of a majority of the
outstanding voting securities of the relevant series or by you. This Agreement
will automatically terminate in the event of its assignment. This Agreement may
remain in effect with respect to a series of the Shares even if it has been
terminated in accordance with this paragraph with respect to one or more other
series of the Shares. In interpreting the provisions of this paragraph 14, the
definitions contained in Section 2(a) of the 1940 Act (particularly the
definitions of "interested person", "assignment" and "majority of the
outstanding voting securities"), as modified by any applicable order of the
Securities and Exchange Commission, shall be applied.
15. Amendment of this Agreement. No provisions of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. If the Company should at any time deem it
necessary or advisable in the best interests of the Company that any amendment
of this Agreement be made in order to comply with the recommendations or
requirements of the Securities and Exchange Commission or other governmental
authority or to obtain any advantage under state or federal tax laws and should
notify you of the form of such amendment, and the reasons therefor, and if you
should decline to assent to such amendment, the Company may terminate this
Agreement
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forthwith. If you should at any time request that a change be made in the
Company's Articles of Incorporation or By-laws or in its methods of doing
business, in order to comply with any requirements of federal law or regulations
of the Securities and Exchange Commission or of a national securities
association of which you are or may be a member relating to the sale of the
Shares, and the Company should not make such necessary change within a
reasonable time, you may terminate this Agreement forthwith.
16. Termination of Prior Agreements. This Agreement upon its effectiveness
terminates and supersedes all prior underwriting contracts between the parties,
if any.
17. Miscellaneous. 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. This
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this letter and return such
counterpart to the Company, whereupon this letter shall become a binding
contract.
Very truly yours,
XXXXXXX MUTUAL FUNDS, INC.
By /s/ Xxxxxx Xxxxxx
---------------------------------
President
The foregoing Agreement is hereby accepted as of the date thereof.
XXXXXXX FUND DISTRIBUTORS, INC.
By /s/ Xxxxx X. Xxx
---------------------------------
President
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