UNDERWRITING AGREEMENT
BETWEEN
X. XXXX PRICE MEDIA & TELECOMMUNICATIONS FUND, INC.
AND
X. XXXX PRICE INVESTMENT SERVICES, INC.
THIS UNDERWRITING AGREEMENT, made as of the 26th day of July, 1997, by
and between X. XXXX PRICE MEDIA & TELECOMMUNICATIONS FUND, INC., a
corporation
organized and existing under the laws of the State of Maryland (hereinafter
called the "Corporation"), and X. XXXX PRICE INVESTMENT SERVICES, INC., a
corporation organized and existing under the laws of the State of Maryland
(hereinafter called the "Distributor").
W I T N E S S E T H:
WHEREAS, the Corporation proposes to engage in business as an open-end
management investment company and to register as such under the federal
Investment Company Act of 1940, as amended ("ICA-40"); and
WHEREAS, the Distributor is engaged principally in the business of
distributing shares of the investment companies sponsored and managed by
either Price Associates ("Price Associates") or Xxxx Xxxxx-Xxxxxxx
International, Inc. ("Xxxxx-Xxxxxxx") and is registered as a broker-dealer
under the Securities Exchange Act of 1934, as amended, ("SEA-34") and is a
member of the National Association of Securities Dealers, Inc. ("NASD"); and
WHEREAS, the Corporation desires the Distributor to act as the
distributor in the public offering of the Shares of the Funds; and
NOW, THEREFORE, in consideration of the premises and the mutual promises
hereinafter set forth, the parties hereto agree as follows:
1. Delivery of Corporate Documents. The Corporation has furnished
Distributor with copies, properly certified or authenticated, of each of the
following:
(a) Amended and Restated Articles of Incorporation, effective as
of July 25, 1997.
(b) Amended and Restated By-Laws of the Corporation as in effect
on the date hereof.
(c) Resolutions of the Board of Directors of the Corporation
selecting Distributor as principal underwriter for the Fund
and approving this form of agreement.
The Corporation shall furnish the Distributor from time to time with
copies, properly certified or authenticated, of all the amendments of, or
supplements to, the foregoing, if any.
The Corporation shall furnish Distributor promptly with properly
certified or authenticated copies of any registration statements filed by it
on behalf of the Fund with the Securities and Exchange Commission under the
Securities Act of 1933, as amended ("SA-33") or ICA-40, together with any
financial statements and exhibits included therein, and all amendments or
supplements thereto hereafter filed.
2. Sale of Shares. Subject to the provisions of Paragraphs 3, 4, and
6 hereof, and to such minimum purchase requirements as may from time to time
be currently indicated in the Corporation's prospectus, on behalf of the Fund,
the Distributor is authorized to sell, as agent for the Corporation, on behalf
of the Fund, Shares authorized for issuance and registered under SA-33.
Distributor may also sell Shares under offers of exchange between and among
the investment companies for which Price Associates and/or Xxxxx-Xxxxxxx act
as investment advisers ("Price Funds"). Distributor may also purchase as
principal such Shares for resale to the public. Such sale will be made by
Distributor on behalf of the Fund by accepting unconditional orders to
purchase the Shares placed with Distributor by investors and such purchases
will be made by Distributor only after acceptance by Distributor of such
orders. The sales price to the public of such Shares shall be the public
offering price as defined in Paragraph 5 hereof.
3. Sale of Shares by the Corporation. The rights granted to the
Distributor shall be nonexclusive in that the Corporation, on behalf of the
Fund, reserves the right to sell Shares of the Fund to investors pursuant to
applications received and accepted by the Corporation or its transfer agent.
Further, the Corporation reserves the right to issue Shares in connection with
the merger or consolidation of any other investment company, trust, or
personal holding company with the Corporation or the Corporation's acquisition
by the purchase or otherwise, of all or substantially all of the assets of an
investment company, trust, or personal holding company. Any right granted to
Distributor to accept orders for Shares, or to make sales on behalf of the
Fund or to purchase Shares for resale, will not apply to Shares issued in
connection with the merger or consolidation of any other investment company
with the Corporation or its acquisition by purchase or otherwise, of all or
substantially all of the assets of any investment company, trust, or personal
holding company, or substantially all of the outstanding shares or interests
of any such entity, and such right shall not apply to Shares that may be
offered by the Corporation to shareholders by virtue of their being
shareholders of the Fund.
4. Shares Covered by This Agreement. This Agreement relates to the
issuance and sale of Shares that are duly authorized, registered, and
available for sale by the Corporation, on behalf of the Fund, including
redeemed or repurchased Shares if and to the extent that they may be legally
sold and if, but only if, the Corporation authorizes the Distributor to sell
them.
5. Public Offering Price. All Shares sold by the Distributor
pursuant to this Agreement shall be sold at the public offering price. The
public offering price for all accepted subscriptions will be the net asset
value per share, as determined in the manner provided in the Corporation's
Amended and Restated Articles of Incorporation, with respect to the Fund, as
now in effect, or as they may be amended (and as reflected in the then current
prospectus of the Corporation, with respect to the Fund), next determined
after the order is accepted by the Distributor. The Distributor will process
orders submitted by brokers for the sale of Shares at the public offering
price exclusive of any commission charged by such broker to his customer.
6. 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 the Distributor except such
unconditional orders placed with the Distributor before it had knowledge of
the suspension. In addition, the Corporation reserves the right to suspend
sales and Distributor's authority to accept orders for Shares on behalf of the
Fund if, in the judgment of the Board of Directors of the Corporation, it is
in the best interests of the Corporation or Fund to do so, such suspension to
continue for such period as may be determined by the Board of Directors; and
in that event, no orders to purchase Shares shall be processed or accepted by
the Distributor on behalf of the Fund while such suspension remains in effect
except for Shares necessary to cover unconditional orders accepted by
Distributor before it had knowledge of the suspension, unless otherwise
directed by the Board of Directors.
7. Solicitation of Orders. In consideration of the rights granted to
the Distributor under this Agreement, Distributor will use its best efforts
(but only in states in which Distributor may lawfully do so) to obtain from
investors unconditional orders for Shares authorized for issuance by the
Corporation, on behalf of the Fund, and registered under SA-33, provided that
Distributor may in its discretion reject any order to purchase Shares. This
does not obligate the Distributor to register or maintain its registration as
a broker or dealer under the state securities laws of any jurisdiction if, in
the discretion of the Distributor, such registration is not practical or
feasible. The Fund shall make available to the Distributor at the expense of
the Distributor such number of copies of the Fund's currently effective
prospectus as the Distributor may reasonably request. The Fund shall furnish
to the Distributor copies of all information, financial statements, and other
papers which the Distributor may reasonably request for use in connection with
the distribution of Shares.
8. Authorized Representations. The Corporation is not authorized by
the Distributor to give, on behalf of the Distributor, any information or to
make any representations other than the information and representations
contained in a registration statement or prospectus filed with the SEC under
SA-33 and/or ICA-40, covering Shares, as such registration statement and
prospectus may be amended or supplemented from time to time.
Distributor is not authorized by the Corporation to give on behalf of
the Fund any information or to make any representations in connection with the
sale of Shares other than the information and representations contained in a
registration statement or prospectus filed with the Securities and Exchange
Commission ("SEC") under SA-33 and/or ICA-40, covering Shares, as such
registration statement and prospectus may be amended or supplemented from time
to time, or contained in shareholder reports or other material that may be
prepared by or on behalf of the Fund for the Distributor's use. This shall not
be construed to prevent the Distributor from preparing and distributing
tombstone ads and sales literature or other material as it may deem
appropriate. No person other than Distributor is authorized to act as
principal underwriter (as such term is defined in ICA-40, as amended) for the
Corporation.
9. Registration and Sale of Additional Shares. The Corporation, on
behalf of the Fund will, from time to time, use its best efforts to register
under SA-33, such Shares of the Fund as Distributor may reasonably be expected
to sell on behalf of the Fund. In connection therewith, the Corporation, on
behalf of the Fund, hereby agrees to register an indefinite number of Shares
pursuant to Rule 24f-2 under ICA-40, and to register such Shares as shall be
deemed advisable pursuant to Rule 24e-2 under ICA-40, as amended. The
Corporation, on behalf of the Fund will, in cooperation with the Distributor,
take such action as may be necessary from time to time to qualify such Shares
(so registered or otherwise qualified for sale under SA-33), in any state
mutually agreeable to the Distributor and the Fund, and to maintain such
qualification.
10. Expenses. The Distributor shall pay (or will enter into
arrangements providing that persons other than Distributor shall pay) all fees
and expenses:
a. in connection with the preparation, setting in type and
filing of any registration statement and prospectus under
SA-33 and/or ICA-40, and any amendments or supplements that
may be made from time to time;
b. in connection with the sale in the various states in which
the Corporation shall determine it advisable to sell such
Shares. (Including registering the Corporation as a broker
or dealer or any officer of the Corporation or other person
as agent or salesman of the Corporation in any state.);
c. of preparing, setting in type, printing and mailing any
report or other communication to shareholders of the Fund in
their capacity as such;
d. of preparing, setting in type, printing and mailing
prospectuses annually to existing shareholders;
e. in connection with the issue and transfer of Shares
resulting from the acceptance by Distributor of orders to
purchase Shares placed with the Distributor by investors,
including the expenses of confirming such purchase orders;
f. of any issue taxes or (in the case of Shares redeemed) any
initial transfer taxes.
The Distributor shall pay (or will enter into arrangements providing
that persons other than Distributor shall pay) all fees and expenses:
a. of printing and distributing any prospectuses or reports
prepared for its use in connection with the distribution of
Shares to the public;
b. of preparing, setting in type, printing and mailing any
other literature used by the Distributor in connection with
the distribution of the Shares to the public;
c. of advertising in connection with the distribution of such
Shares to the public;
d. incurred in connection with its registration as a broker or
dealer or the registration or qualification of its officers,
directors or representatives under federal and state laws;
and
e. incurred in connection with the sale and offering for sale
of Shares which have not been herein specifically allocated
to the Fund.
11. Conformity With Law. Distributor agrees that in selling Shares it
shall duly conform in all respects with the laws of the United States and any
state in which such Shares may be offered for sale by Distributor pursuant to
this Agreement and to the rules and regulations of the NASD.
12. Independent Contractor. Distributor shall be an independent
contractor and neither Distributor, nor any of its officers, directors,
employees, or representatives is or shall be an employee of the Corporation in
the performance of Distributor's duties hereunder. Distributor shall be
responsible for its own conduct and the employment, control, and conduct of
its agents and employees and for injury to such agents or employees or to
others through its agents or employees. Distributor assumes full
responsibility for its agents and employees under applicable statutes and
agrees to pay all employee taxes thereunder.
13. Indemnification. Distributor agrees to indemnify and hold
harmless the Corporation or Fund, as appropriate, and each of the
Corporation's directors, officers, employees, representatives, and each
person, if any, who controls the Corporation or Fund within the meaning of
Section 15 of SA-33 against any and all losses, liabilities, damages, claims
or expenses (including the reasonable costs of investigating or defending any
alleged loss, liability, damage, claim, or expense and reasonable legal
counsel fees incurred in connection therewith) to which the Corporation or
Fund or such of the Corporation's directors, officers, employees,
representatives, or controlling person may become subject under SA-33, 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
Distributor or any of Distributor's directors, officers, 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,
prospectus, shareholder report, or other information covering Shares filed or
made public by the Corporation, on behalf of the Fund, 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 the Corporation by Distributor. In no
case (i) is Distributor's indemnity in favor of the Corporation or Fund, as
appropriate, or any person indemnified to be deemed to protect the Corporation
or Fund, as appropriate, or such indemnified person against any liability to
which the Corporation or Fund, as appropriate, or 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 his
obligations and duties under this Agreement or (ii) is Distributor to be
liable under its indemnity agreement contained in this Paragraph with respect
to any claim made against the Corporation or Fund, as appropriate, or any
person indemnified unless the Corporation or Fund, as appropriate, or such
person, as the case may be, shall have notified Distributor in writing of the
claim within a reasonable time after the summons or other first written
notification giving information of the nature of the claim shall have been
served upon the Corporation or Fund, as appropriate, or upon such person (or
after the Corporation or Fund or such person shall have received notice of
such service on any designated agent). However, failure to notify Distributor
of any such claim shall not relieve Distributor from any liability which
Distributor may have to the Corporation or Fund or any person against whom
such action is brought otherwise than on account of Distributor's indemnity
agreement contained in this Paragraph.
Distributor shall be entitled to participate, at its own expense, in the
defense, or, if Distributor so elects, to assume the defense of any suit
brought to enforce any such claim, but, if Distributor elects to assume the
defense, such defense shall be conducted by legal counsel chosen by
Distributor and satisfactory to the Corporation, on behalf of the Fund, to its
directors, officers, employees, or representatives, or to any controlling
person or persons, defendant or defendants, in the suit. In the event that
Distributor elects to assume the defense of any such suit and retain such
legal counsel, the Corporation, its directors, officers, employees,
representatives, or controlling person or persons, defendant or defendants in
the suit, shall bear the fees and expenses of any additional legal counsel
retained by them. If Distributor does not elect to assume the defense of any
such suit, Distributor will reimburse the Corporation, on behalf of the Fund,
such directors, officers, employees, representatives, or controlling person or
persons, defendant or defendants in such suit for the reasonable fees and
expenses of any legal counsel retained by them. Distributor agrees to promptly
notify the Corporation of the commencement of any litigation or proceedings
against it or any of its directors, officers, employees, or representatives in
connection with the issue or sale of any Shares.
The Corporation, on behalf of the Fund, agrees to indemnify and hold
harmless Distributor and each of its directors, officers, employees,
representatives, and each person, if any, who controls Distributor within the
meaning of Section 15 of SA-33 against any and all losses, liabilities,
damages, claims, or expenses (including the reasonable costs of investigating
or defending any alleged loss, liability, damage, claim, or expense and
reasonable legal counsel fees incurred in connection therewith) to which
Distributor or such of its directors, officers, employees, representatives, or
controlling person may become subject under SA-33, 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 Corporation or any
of the Corporation's directors, officers, 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, prospectus, shareholder
report, or other information covering Shares filed or made public by the
Corporation, on behalf of the Fund, 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 Distributor by the Corporation. In no case (i) is the
Corporation's indemnity in favor of the Distributor, or any person indemnified
to be deemed to protect the Distributor or such indemnified person against any
liability to which the Distributor or 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 his
obligations and duties under this Agreement, or (ii) is the Corporation, on
behalf of the Fund, to be liable under its indemnity agreement contained in
this Paragraph with respect to any claim made against Distributor, or person
indemnified unless Distributor, or such person, as the case may be, shall have
notified the Corporation in writing of the claim within a reasonable time
after the summons or other first written notification giving information of
the nature of the claim shall have been served upon Distributor or upon such
person (or after Distributor or such person shall have received notice of such
service on any designated agent). However, failure to notify the Corporation
of any such claim shall not relieve the Corporation from any liability which
the Corporation may have to Distributor or any person against whom such action
is brought otherwise than on account of the Corporation's indemnity agreement
contained in this Paragraph.
The Corporation, on behalf of the Fund, shall be entitled to
participate, at its own expense, in the defense, or, if the Corporation, on
behalf of the Fund, so elects, to assume the defense of any suit brought to
enforce any such claim, but, if the Corporation, on behalf of the Fund, elects
to assume the defense, such defense shall be conducted by legal counsel chosen
by the Corporation, on behalf of the Fund, and satisfactory to Distributor, to
its directors, officers, employees or representatives, or to any controlling
person or persons, defendant or defendants, in the suit. In the event that the
Corporation, on behalf of the Fund, elects to assume the defense of any such
suit and retain such legal counsel, Distributor, its directors, officers,
employees, representatives, or controlling person or persons, defendant or
defendants in the suit, shall bear the fees and expenses of any additional
legal counsel retained by them. If the Corporation, on behalf of the Fund,
does not elect to assume the defense of any such suit, the Corporation, on
behalf of the Fund, will reimburse Distributor, such directors, officers,
employees, representatives, or controlling person or persons, defendant or
defendants in such suit for the reasonable fees and expenses of any legal
counsel retained by them. The Corporation, on behalf of the Fund, agrees to
promptly notify Distributor of the commencement of any litigation or
proceedings against it or any of its directors, officers, employees, or
representatives in connection with the issue or sale of any Shares.
14. Limitation on Liability of Corporation. The term "X. Xxxx Price
Media & Telecommunication Fund, Inc.," means and refers to the directors from
time to time serving under the Amended and Restated Articles of Incorporation
of the Corporation effective as of July 25, 1997, as the same may subsequently
thereto have been, or subsequently hereto be, amended. It is expressly agreed
that the obligations of the Corporation hereunder shall not be binding upon
any of the directors, shareholders, nominees, officers, agents, or employees
of the Corporation, personally, but bind only the trust property of the
Corporation, as provided in the Amended and Restated Articles of Incorporation
of the Corporation. The execution and delivery of this Agreement have been
authorized by the directors of the Corporation and signed by an authorized
officer of the Corporation, acting as such, and neither such authorization by
such directors nor such execution and delivery by such officer shall be deemed
to have been made by any of them but shall bind only the trust property of the
Corporation as provided in its Amended and Restated Articles of Incorporation.
15. Duration and Termination of This Agreement. This Agreement shall
become effective upon its execution ("effective date") and, unless terminated
as provided, shall remain in effect through April 30, 1998, 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 of the
Corporation who are not interested persons of Distributor or of the
Corporation, cast in person at a meeting called for the purpose of voting on
such approval, and by vote of the directors of the Corporation or of a
majority of the outstanding voting securities of the Corporation. This
Agreement may, on 60 days' written notice, be terminated at any time, without
the payment of any penalty, by the vote of a majority of the directors of the
Corporation who are not interested persons of Distributor or the Corporation,
by a vote of a majority of the outstanding voting securities of the
Corporation, or by Distributor. This Agreement will automatically terminate in
the event of its assignment. In interpreting the provisions of this Paragraph
15, the definitions contained in Section 2(a) of ICA-40 (particularly the
definitions of "interested person," "assignment," and "majority of the
outstanding securities") shall be applied.
16. 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 Corporation should
at any time deem it necessary or advisable in the best interests of the
Corporation that any amendment of this Agreement be made in order to comply
with the recommendations or requirements of the SEC or other governmental
authority or to obtain any advantage under state or federal tax laws and
notifies Distributor of the form of such amendment, and the reasons therefor,
and if Distributor should decline to assent to such amendment, the Corporation
may terminate this Agreement forthwith. If Distributor should at any time
request that a change be made in the Corporation's Amended and Restated
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
SEC, or of a national securities association of which Distributor is or may be
a member relating to the sale of Shares, and the Corporation, on behalf of the
Fund, should not make such necessary change within a reasonable time,
Distributor may terminate this Agreement forthwith.
17. Additional Funds. In the event that the Corporation establishes
one or more series of Shares in addition to the Fund with respect to which it
desires to have Distributor render services as distributor under the terms
hereof, it shall so notify Distributor in writing, and if Distributor agrees
in writing to provide such services, such series of Shares shall become a Fund
hereunder.
18. Miscellaneous. It is understood and expressly stipulated that
neither the shareholders of the Fund, nor the directors of the Corporation
shall be personally liable hereunder. 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.
19. Notice. Any notice required or permitted to be given by either
party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, addressed by the party giving notice to the
other party at the last address furnished by the other party to the party
giving notice: if to the Corporation, 000 Xxxx Xxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxx 00000, and if to the Distributor, at 000 Xxxx Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxx 00000.
ATTEST: X. XXXX PRICE MEDIA & TELECOMMUNICATIONS
FUND, INC.
/s/Xxxxxxxx X. Xxxxxxx /s/Xxxxx X.X. Xxxxxxx III
____________________________ By: _______________________________
Xxxxxxxx X. Xxxxxxx Xxxxx X. X. Xxxxxxx III
Assistant Secretary President
ATTEST: X. XXXX PRICE INVESTMENT SERVICES, INC.
/s/Xxxxxxx X. Xxx Xxxx /s/Xxxxx X. Xxxxxxx
____________________________ By: _______________________________
Xxxxxxx X. Xxx Xxxx Xxxxx X. Xxxxxxx
Assistant Secretary Vice President
