UNDERWRITING AGREEMENT
BETWEEN
X. XXXX PRICE INTERNATIONAL FUNDS, INC.
AND
X. XXXX PRICE INVESTMENT SERVICES, INC.
THIS UNDERWRITING AGREEMENT, made as of the 31st day of March, 2000, by and
between X. XXXX PRICE INTERNATIONAL FUNDS, 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").
WITNESSETH:
WHEREAS, the Corporation is engaged in business as an open-end management
investment company and is registered as such under the federal Investment
Company Act of 1940, as amended ("ICA-40"); and
WHEREAS, the Corporation is authorized to issue shares of capital stock
("Shares") in separate series, with each such series representing the interests
in a separate portfolio of securities and other assets; and
WHEREAS, the Corporation has issued Shares in twelve (12) series,
including, among others, the X. Xxxx Price International Stock Fund and X. Xxxx
Price International Bond Fund, such series together with any other series which
may be established later and served by the Distributor hereunder, being herein
referred to collectively as the "Funds" and individually referred to as a
"Fund"); and
WHEREAS, the shares of the International Stock Fund and International Bond
Fund have been further divided into classes and each such Fund currently is
authorized to offer more than one class of Shares; and
WHEREAS, the Distributor is engaged principally in the business of
distributing shares of the investment companies sponsored and managed by either
X. Xxxx Price Associates, Inc. ("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
WHEREAS, the International Stock Fund and International Bond Fund have each
adopted a plan pursuant to Rule 12b-1 under the ICA-40 (the "Plan") with respect
to one or more classes of Shares (the "12b-1 Shares") authorizing payments by
such Fund out of the assets of the 12b-1 Shares to the Distributor with respect
to the distribution and/or provision of shareholder and administrative services
with respect to such 12b-1 Shares;
NOW, THEREFORE, in consideration of the premises and the mutual promises
hereinafter set forth, the parties hereto agree as follows:
1.
DELIVERY OF CORPORATION DOCUMENTS. The Corporation has furnished Distributor
with copies, properly certified or authenticated, of each of the following:
(a)
Articles of Amendment and Restatement, dated February 16, 1990, as amended.
(b) 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 Funds 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 Funds 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 Funds, the
Distributor is authorized to sell, as agent for the Corporation, on behalf of
the Funds, 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 Funds by accepting unconditional orders to purchase the Shares
placed with Distributor by investors or by selected dealers 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.
The Distributor shall have the right to enter into selected dealer
agreements with registered and qualified securities dealers and other financial
institutions of its choice for the sale of Shares, provided that the Fund shall
approve the forms of such agreements. Within the United States, the
Distributor shall offer and sell Shares only to such selected dealers as are
members in good standing of the NASD or are institutions exempt from
registration under applicable federal securities laws. Shares sold to selected
dealers shall be for resale by such dealers only at 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 Funds, reserves the
right to sell Shares of the Funds 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 Funds 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 Funds.
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 Funds, 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 Articles of
Incorporation, with respect to the Funds, 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 Funds), next 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 Funds if, in the judgment of the Board
of Directors of the Corporation, it is in the best interests of the Corporation
or Funds 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 Funds
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 Funds, 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 Funds shall
make available to the Distributor at the expense of the Distributor such number
of copies of the currently effective prospectus pertaining to the Funds as the
Distributor may reasonably request. The Funds 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.
Neither Distributor nor any selected dealer nor any other person is
authorized by the Corporation to give on behalf of the Funds 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, on behalf of the Funds, 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 Funds. 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
Funds, will, from time to time, use its best efforts to register under SA-33,
such Shares of the Funds as Distributor may reasonably be expected to sell on
behalf of the Funds. In connection therewith, the Corporation, on behalf of the
Funds, hereby agrees to register an indefinite number of Shares pursuant to Rule
24f-2 under ICA-40, as amended. The Corporation, on behalf of the Funds, 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
Funds, and to maintain such qualification.
10.
EXPENSES. The Corporation or Funds, as appropriate, 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 registration and qualification of Shares for sale in the
various states in which the Funds shall determine it advisable to qualify such
Shares for sale.
(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 Funds 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; and
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 Funds.
11. PAYMENT OF THE DISTRIBUTOR UNDER THE PLAN.
a.
The International Stock Fund and International Bond Fund shall each pay a fee to
the Distributor for distribution, shareholder and/or administrative servicing
expenses with respect to such Fund's 12b-1 Shares. Such fee shall be paid under
the Plan adopted by the Fund and this Agreement.
b.
So long as the Plan or any amendment thereto is in effect, the Distributor shall
inform the Board of the distribution expenses and shareholder and administrative
servicing expenses incurred with respect to the 12b-1 Shares by the Distributor.
So long as a Plan (or any amendment thereto) is in effect, at the request of the
Board or any agent or representative of the Fund, the Distributor shall provide
such additional information as may reasonably be requested concerning the
activities of the Distributor hereunder and the costs incurred in performing
such activities with respect to the 12b-1 Shares.
12.
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.
13.
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.
14.INDEMNIFICATION. Distributor agrees to indemnify and hold harmless the
Corporation or Funds, as appropriate, and each of the Corporation's directors,
officers, employees, representatives and each person, if any, who controls the
Corporation or Funds 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 Funds 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 Funds, 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 Funds, as
appropriate, or any person indemnified to be deemed to protect the Corporation
or Funds, as appropriate, or such indemnified person against any liability to
which the Corporation or Funds, 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 Funds, as appropriate, or any person
indemnified unless the Corporation or Funds, 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 Funds, as appropriate, or upon such person (or after the
Corporation or Funds 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 Funds 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
Funds, 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 Funds, 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 Funds, 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 Funds, 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 Funds, 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 Funds, shall be entitled to participate,
at its own expense, in the defense, or, if the Corporation, on behalf of the
Funds, so elects, to assume the defense of any suit brought to enforce any such
claim, but, if the Corporation, on behalf of the Funds, elects to assume the
defense, such defense shall be conducted by legal counsel chosen by the
Corporation, on
behalf of the Funds, 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 Funds, 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 Funds, does not elect to assume
the defense of any such suit, the Corporation, on behalf of the Funds, 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 Funds, 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.
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, 2001 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 16, 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 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 Funds, 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 Funds 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.
SEPARATE AGREEMENT AS TO CLASSES. The amendment or termination of this Agreement
with respect to any class of Shares shall not result in the amendment or
termination of this Agreement with respect to any other class of Shares unless
explicitly so provided.
19.
MISCELLANEOUS. It is understood and expressly stipulated that neither the
shareholders of the Funds, 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.
20.
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 INTERNATIONAL FUNDS, INC.
/s/Xxxxxxxx X. Xxxxxxx /s/Xxxxxx X. Xxxx
__________________________ By: ________________________________
Xxxxxxxx X. Xxxxxxx, Secretary Xxxxxx X. Xxxx, President
ATTEST: X. XXXX PRICE INVESTMENT SERVICES, INC.
/s/Xxxxxxxx X. Xxxxxxx /s/Xxxxx X. Xxxxxxx
__________________________ By: ________________________________
Xxxxxxxx X. Xxxxxxx, Secretary Xxxxx X. Xxxxxxx, Vice President
