1358Q EXHIBIT 6
DISTRIBUTION AGREEMENT
July 22, 0000
Xxxx Xxxxx & Company, Incorporated
00 Xxxxxxxxxx Xxxxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Dear Sirs:
This is to confirm that, in consideration of the agreements contained in
this Agreement, the undersigned, The Xxxxx American Fund (the "Fund"), an
unincorporated business trust organized under the laws of the Commonwealth of
Massachusetts, has agreed that Xxxx Xxxxx & Company, Incorporated ("Alger Inc.")
shall be, for the period of this Agreement, the distributor of shares of
beneficial interest of the Fund.
1. Services as Distributor
1.1 Xxxxx Inc. will act as agent for the distribution of each series
of shares of beneficial interest of the Fund (the "Shares") covered by the
registration statement, prospectus and statement of additional information then
in effect (the "Registration Statement") under the Securities Act of 1933, as
amended (the "1933 Act"), and the Investment Company Act of 1940, as amended
(the "1940 Act").
1.2 All activities by Xxxxx Inc. as distributor of the Shares shall
comply with all applicable laws, rules and regulations, including, without
limitation, all rules and regulations made or adopted by the Securities and
Exchange Commission (the "SEC") or by any securities association registered
under the Securities Exchange Act of 1934, as amended.
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1.3 Xxxxx Inc. will provide one or more persons during normal
business hours to respond to telephone inquiries concerning the Fund.
1.4 Xxxxx Inc. acknowledges that whenever in the judgment of the
Fund's officers such action is warranted for any reason, including, without
limitation, market, economic or political conditions, those officers may decline
to accept any orders for, or make any sales of, the Shares until such time as
those officers deem it advisable to accept such orders and to make such sales.
1.5 Xxxxx Inc. will act only on its own behalf as principal should
it choose to enter into selling agreements with selected dealers or others.
2. Duties of the Fund
The Fund shall furnish from time to time, for use in connection with
the sale of the Shares, such information reports with respect to the Fund and
the Shares as Xxxxx Inc. may reasonably request, all of which shall be signed by
one or more of the Fund's duly authorized officers; and the Fund warrants that
the statements contained in any such reports, when so signed by one or more of
the Fund's officers, shall be true and correct. The Fund shall also furnish
Alger Inc. upon request with: (a) annual audits of the Fund's books and accounts
made by independent public accountants regularly retained by the Fund, (b)
semiannual unaudited financial statements pertaining to the Fund, (c) quarterly
earnings statements prepared by the Fund, (d) a monthly itemized list of the
securities in each Portfolio, (e) monthly balance sheets as soon as practicable
after the end of each month and (f) from time to time such additional
information regarding the Fund's financial condition as Xxxxx Inc. may
reasonably request.
3. Representations and Warranties
The Fund represents to Xxxxx Inc. that all registration statements,
prospectuses and statements of additional information filed by the Fund with the
SEC under the 1933 Act and the 1940 Act with respect to the Shares have been
prepared in conformity with the requirements of the 1933 Act, the 1940 Act and
the rules and regulations of the SEC thereunder. As used in this Agreement the
terms "registration statement", "prospectus" and "statement of additional
information" shall mean any registration statement, prospectus and statement of
additional information filed by the Fund with
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the SEC and any amendments and supplements thereto that at any time shall have
been filed with the SEC. The Fund represents and warrants to Xxxxx Inc. that any
registration statement, prospectus and statement of additional information, when
such registration statement becomes effective, will include all statements
required to be contained therein in conformity with the 1933 Act, the 1940 Act
and the rules and regulations of the SEC; that all statements of fact contained
in any registration statement, prospectus or statement of additional information
will be true and correct when such registration statement becomes effective; and
that neither any registration statement nor any prospectus or statement of
additional information when such registration statement becomes effective will
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading to a purchaser of the Shares. Xxxxx Inc. may, but shall not be
obligated to, propose from time to time such amendment or amendments to any
registration statement and such supplement or supplements to any prospectus or
statement of additional information as, in the light of future developments,
may, in the opinion of counsel to Xxxxx Inc. be necessary or advisable. If the
Fund shall not propose such amendment or amendments and/or supplement or
supplements within fifteen days after receipt by the Fund of a written request
from Xxxxx Inc. to do so, Xxxxx Inc. may, at its option, terminate this
Agreement. The Fund shall not file any amendment to any registration statement
or supplement to any prospectus or statement of additional information without
giving Xxxxx Inc. reasonable notice thereof in advance; provided, however, that
nothing contained in this Agreement shall in any way limit the Fund's right to
file at any time such amendments to any registration statement and/or
supplements to any prospectus or statement of additional information, of
whatever character, as the Fund may deem advisable, such right being in all
respects absolute and unconditional.
4. Indemnification
4.1 The Fund authorizes Xxxxx Inc. and any dealers with whom Xxxxx
Inc. has entered into dealer agreements to use any prospectus or statement of
additional information furnished by the Fund from time to time, in connection
with the sale of the Fund's shares. The Fund agrees to indemnify, defend and
hold Xxxxx Inc., its several officers and directors, and any person who controls
Xxxxx Inc. 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
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therewith) that Xxxxx Inc., its officers and directors, or any such controlling
person, may incur under the 1933 Act, the 1940 Act or common law or otherwise,
arising out of or based upon any untrue statement or alleged untrue statement of
a material fact contained in any registration statement, any prospectus or any
statement of additional information, or arising out of or based upon any
omission or alleged omission to state a material fact required to be stated in
any registration statement, any prospectus or any statement of additional
information, or necessary to make the statements in any of them not misleading;
provided, however, that the Fund's agreement to indemnify Xxxxx Inc., its
officers or directors, and any such controlling person shall not be deemed to
cover any claims, demands, liabilities or expenses arising out of or based upon
any statements or representations made by Xxxxx Inc. or its representatives or
agents other than such statements and representations as are contained in any
registration statement, prospectus or statement of additional information and in
such financial and other statements as are furnished to Xxxxx Inc. pursuant to
paragraph 2 of this Agreement; and further provided that the Fund's agreement to
indemnify Xxxxx Inc. and the Fund's representations and warranties set forth in
paragraph 3 of this Agreement shall not be deemed to cover any liability to the
Fund or its shareholders to which Xxxxx Inc. would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence in the performance
of its duties, or by reason of the reckless disregard of the obligations and
duties of Xxxxx Inc. under this Agreement. The Fund's agreement to indemnify
Xxxxx Inc., its officers and directors, and any such controlling person is
expressly conditioned upon the Fund's being notified of any action brought
against Xxxxx Inc., its officers or directors, or any such controlling person,
such notification to be given by letter or by telegram addressed to the Fund at
its principal office in New York, New York and sent to the Fund by the person
against whom such action is brought, within ten days after the summons or other
first legal process shall have been served. The failure so to notify the Fund of
any such action shall not relieve the Fund from any liability that the Fund may
have to the person against whom such action is brought by reason of any such
untrue or alleged untrue statement or omission or alleged omission otherwise
than on account of the Fund's indemnity agreement contained in this paragraph
4.1. The Fund will be entitled to assume the defense of any suit brought to
enforce any such claim, demand or liability, but, in such case, such defense
shall be conducted by counsel of good standing chosen by the Fund and approved
by Xxxxx Inc. In the event the Fund elects to assume the defense of any such
suit and retain counsel of good standing approved by Xxxxx Inc., the defendant
or
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defendants in such suit shall bear the fees and expenses of any additional
counsel retained by any of them; but in case the Fund does not elect to assume
the defense of any such suit, or in case Xxxxx Inc. does not approve of counsel
chosen by the Fund, the Fund will reimburse Xxxxx Inc., its officers and
directors, or the controlling person or persons named as defendant or defendants
in such suit, for the fees and expenses or any counsel retained by Xxxxx Inc. or
them. The Fund's indemnification agreement contained in this paragraph 4.1 and
the Fund's representations and warranties in this Agreement shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of Xxxxx Inc., its officers and directors, or any controlling
person, and shall survive the delivery of any of the Fund's shares. This
agreement of indemnity will inure exclusively to the benefit of Xxxxx Inc., to
the benefit of its several officers and directors, and their respective estates,
and to the benefit of the controlling persons and their successors. The Fund
agrees to notify Xxxxx Inc. promptly of the commencement of any litigation or
proceedings against the Fund or any of its officers or Trustees in connection
with the issuance and sale of any of the Shares.
4.2 Xxxxx Inc. agrees to indemnify, defend and hold the Fund, its
several officers and Trustees, and any person who controls the Fund within the
meaning of Section 15 of the 1933 Act, free and harmless from and against any
and all claims, demands, liabilities and expenses (including the costs of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) that the Fund, its officers or Trustees
or any such controlling person may incur under the 1933 Act, the 1940 Act or
common law or otherwise, but only to the extent that such liability or expense
incurred by the Fund, its officers or Trustees or such controlling person
resulting from such claims or demands shall arise out of or be based upon (a)
any unauthorized sales literature, advertisements, information, statements or
representations or (b) any untrue or alleged untrue statement of a material fact
contained in information furnished in writing by Xxxxx Inc. to the Fund and used
in the answers to any of the items of the registration statement or in the
corresponding statements made in the prospectus or statement of additional
information, or shall arise out of or be based upon any omission or alleged
omission to state a material fact in connection with such information furnished
in writing by Xxxxx Inc. to the Fund and required to be stated in such answers
or necessary to make such information not misleading. The indemnification by
Xxxxx Inc. of the Fund, its officers and
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Trustees, and any controlling person, is expressly conditioned upon notification
to Xxxxx Inc. of any action brought against the Fund, its officers or Trustees,
or any controlling person, such notification to be given by letter or telegram
addressed to Xxxxx Inc. at its executive office in New York, New York and sent
to Xxxxx Inc. by the person against whom such action is brought, within ten days
after the summons or other first legal process shall have been served. Xxxxx
Inc. shall have the right of first control of the defense of such action, with
counsel of its own choosing, satisfactory to the Fund, if such action is based
solely upon such alleged misstatement or omission on the part of Xxxxx Inc., and
in any other event the Fund, its officers or Trustees or such controlling person
shall each have the right to participate in the defense or preparation of the
defense of any such action. The failure so to notify Xxxxx Inc. of any such
action shall not relieve Xxxxx Inc. from any liability that Xxxxx Inc. may have
to the Fund, its officers or Trustees, or to such controlling person by reason
of any such untrue or alleged untrue statement or omission or alleged omission
otherwise than on account of the indemnity agreement by Xxxxx Inc. contained in
this paragraph 4.2. Xxxxx Inc. agrees to notify the Fund promptly of the
commencement of any litigation or proceedings against Xxxxx Inc. or any of its
officers or directors in connection with the issuance and sale of any of the
Shares.
5. Effectiveness of Registration
None of the Shares shall be offered by either Xxxxx Inc. or the Fund
under any of the provisions of this Agreement and no orders for the purchase or
sale of the Shares hereunder shall be accepted by the Fund if and so long as the
effectiveness of the registration statement then in effect or any necessary
amendments thereto shall be suspended under any of the provisions of the 1933
Act or if and so long as a current prospectus as required by Section 5(b)(2) of
the 1933 Act is not on file with the SEC; provided, however, that nothing
contained in this paragraph 5 shall in any way restrict or have an application
to or bearing upon the Fund's obligation to redeem its shares from any
shareholder in accordance with the provisions of the Fund's prospectus,
statement of additional information or Agreement and Declaration of Trust.
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6. Notice to Xxxxx Inc.
The Fund agrees to advise Xxxxx Inc. immediately in writing:
(a) of any request by the SEC for amendments to the registration
statement, prospectus or statement of additional information then in effect
or for additional information;
(b) in the event of the issuance by the SEC of any stop order
suspending the effectiveness of the registration statement, prospectus or
statement of additional information then in effect or the initiation of any
proceeding for that purpose;
(c) of the happening of any event that makes untrue any statement of
a material fact made in the registration statement, prospectus or
statement of additional information then in effect or that requires the
making of a change in such registration statement, prospectus or statement
of additional information in order to make the statements therein not
misleading; and
(d) of all actions of the SEC with respect to any amendment to any
registration statement, prospectus or statement of additional information
which may from time to time be filed with the SEC.
7. Term of Agreement
This Agreement shall become effective as of the date the Fund
commences its investment operations and shall continue until October 30, 1989
and thereafter shall continue automatically for successive annual periods,
provided such continuance is specifically approved at least annually by (a) the
Fund's Board of Trustees or (b) a vote of a majority (as defined in the 0000
Xxx) of the Fund's outstanding voting securities, provided that in either event
the continuance is also approved by a majority of the Trustees of the Fund who
are not interested persons (as defined in the 0000 Xxx) of any party to this
Agreement, by vote cast in person at a meeting called for the purpose of voting
on such approval. This Agreement is terminable, without penalty, on 60 days'
written notice, by the Fund's Board of Trustees or by vote of the holders of a
majority of the Fund's shares, or on 90 days' written notice, by Xxxxx Inc. This
Agreement will also terminate automatically in the event of its assignment (as
defined in the 1940 Act and the rules thereunder).
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8. Representation by the Fund
The Fund represents that a copy of its Agreement and Declaration of
Trust, dated April 6, 1988, together with all amendments thereto, is on file in
the office of the Secretary of the Commonwealth of Massachusetts.
9. Limitation of Liability
This Agreement has been executed on behalf of the Fund by the
undersigned officer of the Fund in his capacity as an officer of the Fund. The
obligations of this Agreement shall be binding upon the assets and property of
the Fund only and shall not be binding upon any Trustee, officer or shareholder
of the Fund individually.
10. Governing Law
This Agreement shall be governed by and construed in accordance with
the laws (except the conflict of law rules) of the State of New York.
If the foregoing is in accordance with your understanding, kindly
indicate your acceptance of this Agreement by signing and returning the enclosed
copy of this Agreement.
Very truly yours,
THE XXXXX AMERICAN FUND
By: /s/ Xxxx X. Xxxxx
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Authorized Officer
Accepted and Agreed:
XXXX XXXXX & COMPANY, INCORPORATED
By: /s/ Xxxxx Xxxxxxxx
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Authorized Officer
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