EXHIBIT 6
MILLENIUM TAX-FREE INCOME FUND, INC.
DISTRIBUTOR'S AGREEMENT
AGREEMENT dated as of January 12, 1998 between MILLENIUM TAX-FREE INCOME FUND,
INC., a Maryland corporation, hereinafter called the "Company", and XXXXXX
SECURITIES, INC., a New Jersey corporation, hereinafter called the
"Distributor".
W I T N E S S E T H:
1. APPOINTMENT OF FUND DISTRIBUTOR. The Company hereby appoints the
Distributor as the exclusive distributor to sell as principal and not as agent
shares of capital stock of the Company during the term of this Agreement.
2. SALES OF CAPITAL STOCK. The Company agrees to sell and deliver to
the Distributor, upon the terms set forth herein, such fully-paid and
non-assessable shares of capital stock of the Company ("Shares") then
effectively registered for continuous offering under the Securities Act of 1933
(the "Act") as Distributor shall order from the Company, but only to the extent
that the Distributor shall have received purchase orders therefor. All orders
from the Distributor shall be subject to confirmation by the Company, and the
Company authorizes the Distributor to reject any purchase order.
The Distributor as principal may sell and distribute any Shares so
purchased, through dealers or otherwise, in such manner not inconsistent with
law and all applicable rules and regulations, including those of any applicable
self-regulatory organizations, and the provisions of this Agreement, as the
Distributor may from time to time determine. The Distributor agrees to use its
best efforts to effect sales of Shares, but does not undertake to sell any
specific number of Shares thereof.
The Distributor may in its discretion sell the Shares to such
registered and qualified retail dealers as it may select. In making agreements
with its dealers or others for sale of the Shares, the Distributor shall act
only as principal and in no sense as agent for the Company.
3. SALES BY DISTRIBUTOR - OFFERING PRICE. All Shares, whether purchased
from the Company or otherwise, shall be offered for sale and sold by the
Distributor at a price per share (hereinafter called the "Offering Price") in
accordance with the provisions of the current prospectus applicable to such
offer and sale. Any sales charge and any reduction or elimination thereof shall
be determined by the Distributor in a manner not inconsistent with law and all
applicable rules and regulations and the provisions of this Agreement, and the
Company agrees to amend its current prospectus to the extent necessary from time
to time to reflect any such determination. The Company will cause such net asset
value to be determined with such frequency and as of such times and will cause
the Offering Price to be effective for such periods as are set forth in the
current prospectus of the Company. The Company will cause such determinations to
be furnished to the Distributor as often as they are made and shall make
available to the Distributor upon request the computations underlying any such
determination.
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Anything to the contrary herein notwithstanding, the Company may
suspend the Offering Price currently in effect and may decline to accept or
confirm any orders for, or to make any sales of, any Shares to the Distributor
under this Agreement until such time as it shall deem it advisable to accept and
confirm such orders and to make such sales. During any period during which the
Offering Price currently in effect shall be suspended or during which the
Company shall decline to accept or confirm any such orders or make any such
sales, the Company shall be under no obligation to confirm or accept any such
orders or make any such sales at any price.
4. PAYMENT. At or prior to the time of delivery by the Company to, or
on the order of the Distributor of any Shares, the Distributor will pay or cause
to be paid to the Company or to its order an amount equal to the Offering Price
of such shares at which such order had been confirmed, less the sales charge, if
any, included thereon as aforesaid. The Distributor agrees to cause to be
remitted to the Company for the benefit of the Company or to its order all such
funds promptly after receipt thereof.
5. COMPENSATION OF DISTRIBUTOR. Any sales charges and any compensation
to be paid the Distributor out of any Distribution Plan described in 6(e) below
shall constitute the entire compensation of the Distributor. Out of such sales
charge the Distributor may allow concessions to dealers as the Distributor shall
from time to time determine.
6. ALLOCATION OF EXPENSES. The Company shall pay all expenses
connected with (i) the organization of the Company or any Fund thereof and (ii)
the offering of Shares, including without limitation all expenses of:
(a) Registering Shares for offer or sale under the federal
securities laws, except for prospectus printing costs as set forth
below; and
(b) Reports required by and under the federal securities laws;
and
(c) Issuance of Shares, including cost of stock certificates,
issue taxes (if any) and fees of legal counsel and of the transfer
agent; and
(d) Registering or qualifying Shares for offer or sale under
the securities laws of any state or other jurisdiction in which the
Distributor may arrange for the sale of the Shares; and
(e) Any Distribution Plan adopted in accordance with Rule
12b-1 under the Investment Company Act of 1940 (the "1940 Act")
providing for any payments by the Company or any Fund thereof.
The Distributor will pay, or promptly reimburse the Company for, all
expenses in connection with:
(a) Preparing, printing and distributing advertising and sales
literature for use in offering the Shares to the public, including the
cost of printing copies of the prospectus and the additional cost of
printing reports to stockholders other than copies thereof required for
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distribution to stockholders or for filing with any securities
authorities; and
(b) The registration or qualification of the Distributor as a
dealer or broker under state or federal laws.
Transfer taxes, if any, which may be payable in connection with the
issue and delivery of certificates in a name or names other than the name of the
Distributor will not be borne by the Company and the Distributor agrees to
indemnify and hold the Company harmless against any such transfer taxes. Any
other taxes in connection with the sale of Shares pursuant to this Agreement
will be borne by the Company.
7. COMPANY TO FURNISH INFORMATION. The Company shall furnish the
Distributor for use in connection with the sale of the Shares such information
with respect to the Company and the Shares as the Distributor may reasonably
request, including copies of documents filed with or furnished to any federal or
state securities authorities or sent to its stockholders.
8. REPRESENTATIONS AND AGREEMENTS WITH RESPECT TO REGISTRATION
STATEMENT AND PROSPECTUS.
(a) As used in this Agreement, the term "registration
statement" shall include any registration statement with respect to the
Shares which is effective under the Act including any amendment
thereto, and the term "prospectus" shall include any prospectus and
statement of additional information filed as part of such registration
statement.
(b) The Company represents that the registration statement and
prospectus will conform in all material respects to the Act and the
rules and regulations thereunder and will not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided that this representation will not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by the
Distributor expressly for use in the registration statement or
prospectus.
(c) The Company agrees to advise the Distributor promptly:
(i) of any request of the Securities and Exchange
Commission for amendments to the registration statement or
prospectus or for additional information;
(ii) in the event of the issuance by the Securities
and Exchange Commission of any stop order suspending the
effectiveness of the registration statement or prospectus or
the initiation of any proceedings for that purpose;
(iii) of the happening of any event which makes
untrue any statement, or which requires the making of any
change, in the registration statement or prospectus in order
to make the statements therein not misleading; and
(iv) of all actions of the Securities and Exchange
Commission with respect to any amendments to the registration
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statement or prospectus which may from time to time be filed
with the Securities and Exchange Commission under the Act.
9. INDEMNIFICATION. The Company agrees to indemnify, defend and hold
the Distributor, its officers and directors and any person who controls the
Distributor within the meaning of Section 15 of the 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
officers, directors or any such controlling person may incur under the 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 prospectus
relating to the Company or arising out of or based upon any alleged omission to
state a material fact required to be stated in either thereof or necessary to
make the statements in either thereof 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 Company for use in the registration statement or prospectus
relating to the Company; provided, however, that this indemnity agreement, to
the extent that it might require indemnity for liability arising under the Act
of any person who is also an officer or director of the Company or who controls
the Company within the meaning of Section 15 of the Act, shall not inure to the
benefit of such officer, director or controlling person unless a court of
competent jurisdiction shall determine, or it shall have been determined by
controlling precedent, that such result would not be against public policy as
expressed in the Act; and further provided, that in no event shall anything
contained herein be so construed as to protect the Distributor against any
liability to the Company or to its security holders to which the Distributor
would otherwise be subject 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. The Company's agreement to
indemnify the Distributor, its officers and directors and any such controlling
person as aforesaid is expressly conditioned upon the Company being promptly
notified of any action brought against the Distributor, its officers or
directors, or any such controlling person, such notification to be given by
letter or telegram addressed to the Company at its principal business office.
The Company agrees to promptly notify the Distributor of the commencement of any
litigation or proceedings against it or any of its officers or directors in
connection with the issue and sale of any Shares.
The Distributor agrees to indemnify, defend and hold the Company, its
officers and directors and any person who controls the Company, if any, within
the meaning of Section 15 of the 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 Company, its directors or
officers or any such controlling person may incur under the Act or under common
law or otherwise, but only to the extent that such liability or expense incurred
by the Company, its directors 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 Company for use in the Company's registration
statement or prospectus or shall arise out of or be based upon any alleged
omission to state a material fact in connection with such information or shall
arise out of or be based on any false or
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misleading or allegedly false or misleading sales literature relating to the
Company and prepared by the Distributor. The Distributor's agreement to
indemnify the Company, its directors and officers, and any such controlling
person as aforesaid is expressly conditioned upon the Distributor being promptly
notified of any action brought against the Company, its officers or directors
or any such controlling person, such notification being given to the Distributor
at its principal business office.
10. COMPLIANCE WITH SECURITIES LAWS. The Company represents that it is
registered as an open-end diversified management investment company under the
Investment Company Act of 1940, and agrees that it will comply with all of the
provisions of such Act and of the rules and regulations thereunder. The Company
and the Distributor each agree to comply with all of the applicable terms and
provisions of the Investment Company Act of 1940, the Securities Act of 1933
and, subject to the following provisions of this paragraph 11, all applicable
state securities ("Blue Sky") laws. The Distributor agrees to comply with all of
the applicable terms and provisions of the Securities Exchange Act of 1934. The
Company will cooperate with the Distributor (to the extent of supplying all
necessary documents, exhibits and information), and will execute and permit to
be filed with the proper public bodies, such applications (including amendments
and renewals thereof), instruments, papers and exhibits as may be appropriate to
enable the Shares to be offered for sale under the laws of such states as the
Distributor shall reasonably determine, and will cooperate with the Distributor
in the presentation of said applications (including amendments and renewals
thereof), to the end that Shares may be qualified in such states under the
respective Blue Sky laws thereof; provided that the Company shall not be
required to amend its Articles of Incorporation 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 Shares in any state from the terms set forth in its registration
statement and prospectus, 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 Shares. The Distributor will furnish to the Company any
information known to the Distributor which is necessary or desirable in the
preparation of the Company's registration statement and prospectus and any
amendments or supplements thereto.
11. EFFECT ON DISTRIBUTION PLAN OR DISTRIBUTION PLAN AND AGREEMENT. Any
Distribution Plan or Distribution Plan and Agreement in effect on the effective
date of this Agreement which has been adopted in accordance with Rule 12b-1
under the 1940 Act shall remain in effect and any reference therein to a
Distributing Agreement or other underwriting agreement between the parties as of
any date prior thereto shall be deemed to be a reference to this Agreement.
12. EFFECTIVE PERIOD; TERMINATION. This Agreement shall become
effective for an initial period of not more than two years from the date of its
execution, and shall continue in full force and effect continuously thereafter
provided that such continuance is approved at least annually as required by the
1940 Act. This Agreement shall automatically terminate in the event of its
assignment (as defined by the 1940 Act). In addition, this Agreement may be
terminated at any time, without penalty, by either party on not more than sixty
days' nor less than thirty days' written notice delivered or mailed by
registered mail, postage prepaid, to the other party.
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IN WITNESS WHEREOF, Millenium Tax-Free Income Fund, Inc. and Xxxxxx
Securities, Inc. have caused this instrument to be signed in several
counterparts, each of which shall be an original and which together shall
constitute one and the same Agreement, by an officer or officers thereunto duly
authorized, as of the day and year first above written.
MILLENIUM TAX-FREE INCOME FUND, INC.
By: /s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx
Chief Financial Officer
XXXXXX SECURITIES, INC.
By: /s/ Xxxx X. Xxxx
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Xxxx X. Xxxx
Chairman and CEO
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