BBH Common Settlement Fund, Inc.
00 Xxxx Xxxxxx
Xxxxxx, XX 00000
August 15, 2000
00 Xxxx Xxxxxx Distributors, Inc.
00 Xxxx Xxxxxx
Xxxxxx, XX 00000
Gentlemen:
Re: Placement Agent Agreement
This is to confirm that, in consideration of the agreements
hereinafter contained, the undersigned, BBH Common Settlement Fund, Inc. (the
"Corporation"), an open-end diversified management investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), organized
as a Maryland corporation, has agreed that 00 Xxxx Xxxxxx Distributors, Inc.
("59 Wall Street Distributors") shall be the placement agent (the "Placement
Agent") of the shares of the Corporation ("Shares").
1. Services as Placement Agent.
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1.1 00 Xxxx Xxxxxx Distributors will act as Placement Agent of
the Shares covered by the Corporation's registration statement then in effect
under the 1940 Act. In acting as Placement Agent under this Placement Agent
Agreement, neither 00 Xxxx Xxxxxx Distributors nor its employees or any agents
thereof shall make any offer or sale of Shares in a manner which would require
the Shares to be registered under the Securities Act of 1933, as amended (the
"1933 Act").
1.2 All activities by 00 Xxxx Xxxxxx Distributors and its
agents and employees as Placement Agent of Shares shall comply with all
applicable laws, rules and regulations, including, without limitation, all rules
and regulations adopted pursuant to the 1940 Act by the Securities and Exchange
Commission (the "Commission").
1.3 Nothing herein shall be construed to require the
Corporation to accept any offer to purchase any Shares, all of which shall be
subject to approval by the Board of Directors.
1.4 The Corporation shall furnish from time to time for use in
connection with the sale of Shares such information with respect to the
Corporation and Shares as 00 Xxxx Xxxxxx Distributors may reasonably request.
The Corporation shall also furnish 00 Xxxx Xxxxxx Distributors upon request
with: (a) unaudited semiannual statements of the Corporation's books and
accounts prepared by the Corporation and (b) from time to time such additional
information regarding the Corporation's financial or regulatory condition as 00
Xxxx Xxxxxx Distributors may reasonably request.
1.5 The Corporation represents to 00 Xxxx Xxxxxx Distributors
that all registration statements filed by the Corporation with the Commission
under the 1940 Act with respect to Shares have been prepared in conformity with
the requirements of such statute and the rules and regulations of the Commission
thereunder. As used in this Agreement the term "registration statement" shall
mean any registration statement filed with the Commission as modified by any
amendments thereto that at any time shall have been filed with the Commission by
or on behalf of the Corporation. The Corporation represents and warrants to 00
Xxxx Xxxxxx Distributors that any registration statement will contain all
statements required to be stated therein in conformity with both such statute
and the rules and regulations of the Commission; that all statements of fact
contained in any registration statement will be true and correct in all material
respects at the time of filing of such registration statement or amendment
thereto; and that no registration statement will as of its filing date 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 Shares. The Corporation may but shall not be obligated to
propose from time to time such amendment to any registration statement as in the
light of future developments may, in the opinion of the Corporation's counsel,
be necessary or advisable. If the Corporation shall not propose such amendment
and/or supplement within fifteen days after receipt by the Corporation of a
written request from 00 Xxxx Xxxxxx Distributors to do so, 00 Xxxx Xxxxxx
Distributors may, at its option, terminate this Agreement. The Corporation shall
not file any amendment to any registration statement without giving 00 Xxxx
Xxxxxx Distributors reasonable notice thereof in advance; provided, however,
that nothing contained in this Agreement shall in any way limit the
Corporation's right to file at any time such amendment to any registration
statement as the Corporation may deem advisable, such right being in all
respects absolute and unconditional.
1.6 The Corporation agrees to indemnify, defend and hold 00
Xxxx Xxxxxx Distributors, its several officers and directors, and any person who
controls 00 Xxxx Xxxxxx Distributors within the meaning of Section 15 of the
1933 Act or Section 20 of the Securities and Exchange Act of 1934 (the "1934
Act") (for purposes of this paragraph 1.6, collectively, "Covered Persons") 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 any
Covered Person may incur under the 1933 Act, the 1934 Act, common law or
otherwise, arising out of or based on any untrue statement of a material fact
contained in any registration statement, private placement memorandum or other
offering material ("Offering Material") or arising out of or based on any
omission to state a material fact required to be stated in any Offering Material
or necessary to make the statements in any Offering Material not misleading;
provided, however, that the Corporation's agreement to indemnify Covered Persons
shall not be deemed to cover any claims, demands, liabilities or expenses
arising out of any financial and other statements as are furnished in writing to
the Corporation by 00 Xxxx Xxxxxx Distributors in its capacity as Placement
Agent for use in the answers to any items of any registration statement or in
any statements made in any other Offering Material, or arising out of or based
on any omission or alleged omission to state a material fact in connection with
the giving of such information required to be stated in such answers or
necessary to make the answers not misleading; and further provided that the
Corporation's agreement to indemnify 00 Xxxx Xxxxxx Distributors and the
Corporation's representations and warranties hereinbefore set forth in paragraph
1.6 shall not be deemed to cover any liability to the Corporation or its
shareholders to which a Covered Person would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of its
duties, or by reason of a Covered Person's reckless disregard of its obligations
and duties under this Agreement. The Corporation shall be notified of any action
brought against a Covered Person, such notification to be given by letter or by
telegram addressed to the Corporation, 00 Xxxx Xxxxxx, Xxxxxx, XX 00000 with
copies to: Xxxx X. Xxxxxxxxxxx, Xx., Xxxxxxxx & Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 and Xxxxx Brothers Xxxxxxxx & Co., 00 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxx X. Xxxxxxx, promptly after the summons or
other first legal process shall have been duly and completely served upon such
Covered Person. The failure to so notify the Corporation of any such action
shall not relieve the Corporation from any liability except to the extent the
Corporation shall have been prejudiced by such failure, or from any liability
that the Corporation may have to the Covered Person against whom such action is
brought by reason of any such untrue statement or omission, otherwise than on
account of the Corporation's indemnity agreement contained in this paragraph.
The Corporation 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 Corporation and approved
by 00 Xxxx Xxxxxx Distributors, which approval shall not be unreasonably
withheld. In the event the Corporation elects to assume the defense of any such
suit and retain counsel of good standing approved by 00 Xxxx Xxxxxx
Distributors, the defendant or defendants in such suit shall bear the fees and
expenses of any additional counsel retained by any of them; but in case the
Corporation does not elect to assume the defense of any such suit or in case 00
Xxxx Xxxxxx Distributors reasonably does not approve of counsel chosen by the
Corporation, the Corporation will reimburse the Covered Person named as
defendant in such suit for the fees and expenses of any counsel retained by 00
Xxxx Xxxxxx Distributors or it. The Corporation's indemnification agreement
contained in this paragraph and the Corporation'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 Covered Persons, and shall survive
the delivery of any Shares. This agreement of indemnity will inure exclusively
to Covered Persons and their successors. The Corporation agrees to notify 00
Xxxx Xxxxxx Distributors promptly of the commencement of any litigation or
proceedings against the Corporation or any of its officers or Directors in
connection with the issue and sale of any Shares.
1.7 00 Xxxx Xxxxxx Distributors agrees to indemnify, defend
and hold the Corporation, its several officers and Directors, and any person who
controls the Corporation within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act (for purposes of this paragraph 1.7, collectively,
"Covered Persons") free and harmless from and against any and all claims,
demands, liabilities and expenses (including the costs of investigating or
defending such claims, demands, liabilities and any counsel fees incurred in
connection therewith) that Covered Persons may incur under the 1933 Act, the
1934 Act or common law or otherwise, but only to the extent that such liability
or expense incurred by a Covered Person resulting from such claims or demands
shall arise out of or be based on any untrue statement of a material fact
contained in information furnished in writing by 00 Xxxx Xxxxxx Distributors in
its capacity as Placement Agent to the Corporation for use in the answers to any
of the items of any registration statement or in any statements in any other
Offering Material or shall arise out of or be based on any omission to state a
material fact in connection with such information furnished in writing by 00
Xxxx Xxxxxx Distributors to the Corporation required to be stated in such
answers or necessary to make such information not misleading. 00 Xxxx Xxxxxx
Distributors shall be notified of any action brought against a Covered Person,
such notification to be given by letter or telegram addressed to 00 Xxxx Xxxxxx
Distributors at 00 Xxxx Xxxxxx, Xxxxxx, XX 00000 attention: Secretary, promptly
after the summons or other first legal process shall have been duly and
completely served upon such Covered Person. 00 Xxxx Xxxxxx Distributors shall
have the right of first control of the defense of the action with counsel of its
own choosing satisfactory to the Corporation if such action is based solely on
such alleged misstatement or omission on 00 Xxxx Xxxxxx Distributors' part, and
in any other event each Covered Person shall have the right to participate in
the defense or preparation of the defense of any such action. The failure to so
notify 00 Xxxx Xxxxxx Distributors of any such action shall not relieve 00 Xxxx
Xxxxxx Distributors from any liability except to the extent the Corporation
shall have been prejudiced by such failure, or from any liability that 00 Xxxx
Xxxxxx Distributors may have to Covered Persons by reason of any such untrue or
alleged untrue statement, or omission or alleged omission, otherwise than on
account of 00 Xxxx Xxxxxx Distributors' indemnity agreement contained in this
paragraph.
1.8 No Shares shall be offered by either 00 Xxxx Xxxxxx
Distributors or the Corporation under any of the provisions of this Agreement
and no orders for the purchase or sale of Shares hereunder shall be accepted by
the Corporation if and so long as the effectiveness of the registration
statement or any necessary amendments thereto shall be suspended under any of
the provisions of the 1940 Act; provided, however, that nothing contained in
this paragraph shall in any way restrict or have an application to or bearing on
the Corporation's obligation to redeem Shares from any shareholder in accordance
with the provisions of the Corporation's registration statement or Articles of
Incorporation, as amended from time to time.
1.9 The Corporation agrees to advise 00 Xxxx Xxxxxx
Distributors as soon as reasonably practical by a notice in writing delivered to
00 Xxxx Xxxxxx Distributors or its counsel:
(a) of any request by the Commission for amendments to the
registration statement then in effect or for additional information;
(b) in the event of the issuance by the Commission of any stop
order suspending the effectiveness of the registration statement then in effect
or the initiation by service of process on the Corporation 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 then in effect
or that requires the making of a change in such registration statement in order
to make the statements therein not misleading; and
(d) of all action of the Commission with respect to any
amendment to any registration statement that may from time to time be filed with
the Commission.
For purposes of this paragraph 1.9, informal requests by or
acts of the Staff of the Commission shall not be deemed actions of or requests
by the Commission.
1.10 00 Xxxx Xxxxxx Distributors agrees on behalf of itself
and its employees to treat confidentially and as proprietary information of the
Corporation all records and other information not otherwise publicly available
relative to the Corporation and its prior, present or potential shareholders and
not to use such records and information for any purpose other than performance
of its responsibilities and duties hereunder, except after prior notification to
and approval in writing by the Corporation, which approval shall not be
unreasonably withheld and may not be withheld where 00 Xxxx Xxxxxx Distributors
may be exposed to civil or criminal contempt proceedings for failure to comply,
when requested to divulge such information by duly constituted authorities, or
when so requested by the Corporation.
1.11 In addition to 00 Xxxx Xxxxxx Distributors' duties as
Placement Agent, the Corporation understands that 00 Xxxx Xxxxxx Distributors
may, in its discretion, perform additional functions in connection with
transactions in Shares.
The processing of transactions may include, but is not limited
to, compilation of all transactions from 00 Xxxx Xxxxxx Distributors' various
offices; creation of a transaction tape and timely delivery of it to the
Corporation's transfer agent for processing; reconciliation of all transactions
delivered to the Corporation's transfer agent and the recording and reporting of
these transactions executed by the Corporation's transfer agent in customer
statements; rendering of periodic customer statements; and the reporting of IRS
Form 1099 information at year end if required.
00 Xxxx Xxxxxx Distributors may also provide other shareholder
services, such as communicating with Corporation shareholders and other
functions in administering customer accounts for Corporation shareholders.
00 Xxxx Xxxxxx Distributors understands that these services
may result in cost savings to the Corporation or to the Corporation's investment
manager and neither the Corporation nor the Corporation's investment manager
will compensate 00 Xxxx Xxxxxx Distributors for all or a portion of the costs
incurred in performing functions in connection with transactions in Shares.
Nothing herein is intended, nor shall be construed, as requiring 00 Xxxx Xxxxxx
Distributors to perform any of the foregoing functions.
2. Term.
This Agreement shall become effective on the date first above
written and, unless sooner terminated as provided herein, shall continue
automatically for successive annual periods, provided such continuance is
specifically approved at least annually by (i) the Board of Directors of the
Corporation or (ii) by a vote of a majority (as defined in the 0000 Xxx) of the
Corporation's outstanding voting securities, provided that in either event the
continuance is also approved by the majority of the Corporation's Directors who
are not interested persons (as defined in the 0000 Xxx) of the Corporation and
who have no direct or indirect financial interest in this Agreement, by vote
cast in person at a meeting called for the purpose of voting on such approval.
This Agreement is terminable without penalty, on not less than 60 days' notice,
by the Board of Directors of the Corporation, by vote of a majority (as defined
in the 0000 Xxx) of the Corporation's outstanding voting securities, or by 00
Xxxx Xxxxxx Distributors. This Agreement will also terminate automatically in
the event of its assignment (as defined in the 1940 Act and the rules
thereunder).
3. Representations and Warranties.
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00 Xxxx Xxxxxx Distributors and the Corporation each hereby
represents and warrants to the other that it has all requisite authority to
enter into, execute, deliver and perform its obligations under this Agreement
and that, with respect to it, this Agreement is legal, valid and binding, and
enforceable in accordance with its terms.
4. Concerning Applicable Provisions of Law, etc.
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This Agreement shall be subject to all applicable provisions
of law, including the applicable provisions of the 1940 Act and to the extent
that any provisions herein contained conflict with any such applicable
provisions of law, the latter shall control.
The laws of the State of New York shall, except to the extent
that any applicable provisions of federal law shall be controlling, govern the
construction, validity and effect of this Agreement, without reference to
principles of conflicts of law.
The Directors have authorized the execution of this Agreement in their
capacity as Directors and not individually and the Placement Agent agrees that
neither shareholders nor the Directors nor any officer, employee, representative
or agent of the Corporation shall be personally liable upon, nor shall resort be
had to their private property for the satisfaction of, obligations given,
executed or delivered on behalf of or by the Corporation, that neither
shareholders nor the Directors, officers, employees, representatives or agents
of the Corporation shall be personally liable hereunder, and that the Placement
Agent shall look solely to the property of the Corporation for the satisfaction
of any claim hereunder.
If the contract set forth herein is acceptable to you, please
so indicate by executing the enclosed copy of this Agreement and returning the
same to the undersigned, whereupon this Agreement shall constitute a binding
contract between the parties hereto effective at the closing of business on the
date hereof.
Yours very truly,
BBH COMMON SETTLEMENT FUND, INC.
By:
Xxxxxx X. Xxxxxxxx
President
Accepted:
00 XXXX XXXXXX DISTRIBUTORS, INC.
By:
Xxxxxx X. Xxxxxxxx
Chief Executive Officer
