Exhibit 6(b) Distribution Agreement - California Municipal Portfolio
XXXXXXX X. XXXXXXXXX FUND, INC.
XXXXXXXXX CALIFORNIA MUNICIPAL PORTFOLIO
DISTRIBUTION AGREEMENT
AGREEMENT made as of the 1st day of May, 1990, between XXXXXXX X. XXXXXXXXX
FUND, INC., a Maryland corporation (the "Fund"), on behalf of the XXXXXXXXX
CALIFORNIA MUNICIPAL PORTFOLIO (the "Portfolio"), and XXXXXXX X. XXXXXXXXX &
CO., INC., a New York corporation, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(the "Distributor").
In consideration of the mutual covenants contained herein, the parties agree as
follows:
1. Appointment of the Distributor. The Fund, on behalf of the Portfolio, hereby
appoints the Distributor as its exclusive agent to sell the stock of the
Portfolio (the "Shares"), on a best efforts basis, and the Distributor hereby
accepts such appointment. All sales by the Distributor shall be subject to
acceptance by the Fund on behalf of the Portfolio. The Distributor shall be the
exclusive representative of the Fund to act as principal underwriter and
distributor, except that:
The exclusive rights granted to the Distributor to sell Shares on behalf of the
Fund shall not apply to Shares issued in connection with the merger or
consolidation of any other investment company or personal holding company with
the Fund or any Portfolio of the Fund or the acquisition by purchase or
otherwise of all (or substantially all) the assets or the outstanding shares of
any such company by the Fund or any such Portfolio. Such exclusive rights shall
also not apply to shares issued by the Fund or the Portfolio pursuant to
reinvestment of dividends or capital gains distributions.
2. Sales of Shares. The Distributor agrees that (i) all Shares sold by the
Distributor shall be sold at the net asset value thereof as described in Section
3 hereof, and (ii) the Fund, on behalf of the Portfolio, shall receive 100% of
such net asset value.
The Distributor may enter into agreements, in form and substance satisfactory to
the Fund on behalf of the Portfolio, with dealers selected by the Distributor,
providing for 1) the sale to such dealers and resale by such dealers of Shares,
or 2) the sale of Shares through such Distributor acting as agent, either to
clients of the Distributor or other persons, in all cases at the Shares' net
asset value. The Fund shall have the right to suspend the sale of Shares at
times when redemption is suspended pursuant to the conditions set forth in
Section 4 hereof. The Fund, on behalf of the Portfolio, shall also have the
right to suspend the sale of Shares if trading on the New York Stock Exchange
shall have been suspended, if a banking moratorium shall have been declared by
Federal or New York authorities, or if there shall have been some other event,
which, in the judgment of the Fund, makes it impracticable or inadvisable to
sell the shares.
3. Net Asset Value. The Fund, on behalf of the Portfolio, agrees to supply to
the Distributor, promptly after the time or times at which the net asset value
for each Portfolio is determined, on each day on which the net asset value of
the Portfolio is determined as set forth in the then-current Prospectus of the
Fund or the Portfolio, (each such day being hereinafter called a "business day")
a statement of the net asset value per share of the Portfolio determined in the
manner set forth in the then-current Prospectus and Statement of Additional
Information of the Fund or the Portfolio. Each determination of net asset value
per share shall take effect as of such time or times on each business day as set
forth in the then-current Prospectus of the Fund or the Portfolio and shall
prevail until the time as of which the next determination is made.
The Distributor may reject any order for Shares. The Fund, on behalf of the
Portfolio, or any agent of the Fund designated in writing by the Fund, shall be
promptly advised of all purchase orders for Shares received by the Distributor.
Any order may be rejected by the Fund (or its agent) on behalf of the Portfolio.
The Fund (or its agent) will confirm orders upon their receipt, will make
appropriate book entries and upon receipt by the Fund (or its agent) of payment
therefor, will deliver any required certificates for such Shares pursuant to the
instructions of the Distributor. The Distributor agrees to cause payment and
such instructions to be delivered promptly to the Fund (or its agent).
4. Repurchase or Redemption of Shares by the Fund. Any of the outstanding Shares
may be tendered for redemption at any time, and the Fund, on behalf of the
Portfolio, agrees to repurchase or redeem the Shares so tendered on behalf of
the Portfolio in accordance with its obligations as set forth in Article V of
its Articles of Incorporation, as amended from time to time, and in accordance
with the applicable provisions set forth in the Prospectus. The price to be paid
to redeem or
repurchase the Shares shall be equal to the net asset value per share determined
as set forth in the Prospectus. All payments by the Fund on behalf of the
Portfolio hereunder shall be made in the manner set forth below.
The Fund, on behalf of the Portfolio, shall pay the total amount of the
redemption price as defined in the above paragraph pursuant to the instructions
of the Distributor on or before the seventh day subsequent to its having
received the notice of redemption in proper form. The proceeds of any redemption
of Shares shall be paid by the Fund to or for the account of the redeeming
stockholder, in accordance with applicable provisions of the then-current
Prospectus of the Fund or the Portfolio.
Redemption of, or payment with regard to, the Shares of the Portfolio may be
suspended at times when the New York Stock Exchange is closed, when trading on
said Exchange is closed, when trading on said Exchange is restricted, when an
emergency exists as a result of which disposal by the Fund of securities owned
by it on behalf of the Portfolio is not reasonably practicable or it is not
reasonably practicable for the Fund fairly to determine the value of the
Portfolio's net assets, or during any other period when the Securities and
Exchange Commission, by order, so permits.
5. Sales Literature. The Fund, on behalf of the Portfolio, shall have the right
to review, to the extent it deems appropriate, all sales literature and
advertisements used by the Distributor in connection with sales of Shares. No
such sales literature or advertisements shall be used if the Fund objects
thereto. The Fund authorizes the Distributor, in connection with the sale or
arranging for the sale of Shares, to provide only such information and to make
only such statements or representations as are contained in the Fund's or the
Portfolio's then-current Prospectus or Statement of Additional Information,
sales literature or advertisements or in such financial and other statements as
are furnished to the Distributor pursuant to the next paragraph. Neither the
Fund nor the Portfolio shall be responsible in any way for any information
provided, or statements or representations made, by the Distributor or its
representatives or agents other than the information, statements and
representations described in the preceding sentence.
6. Expenses. The Distributor shall pay all of its expenses arising from the
performance of its obligations under Section 1 of this Agreement and shall pay
any salaries, fees and expenses of the Directors who are employees of the
Distributor. Except as provided in the Investment Management Agreement between
the Fund on behalf of the Portfolio and the Distributor, the Distributor shall
not be required to pay any other expenses of the Fund or the Portfolio,
including (a) the fees payable to Xxxxxxxxx under the Investment Management
Agreement and the Shareholder Servicing and Administrative Agreement; (b) the
fees and expenses of Directors who are not affiliated with the Distributor; (c)
the fees and expenses of the Custodian and Transfer Agent, including but not
limited to fees and expenses relating to Fund accounting, pricing of Portfolio
shares, and computation of net asset value; (d) the fees and expenses of
calculating yield and/or performance of the Portfolio; (e) the charges and
expenses of legal counsel and independent accountants; (f) all taxes and
corporate fees payable to governmental agencies; (g) the fees of any trade
association of which the Fund is a member; (h) reimbursement of the Portfolio's
share of the organization expenses of the Fund; (i) the fees and expenses
involved in registering and maintaining registration of the Fund and the
Portfolio's shares with the Securities and Exchange Commission, registering the
Fund as a broker or dealer and qualifying the shares of the Portfolio under
state securities laws, including the preparation and printing of the
registration statements and prospectuses for such purposes, allocable
communications expenses with respect to investor services, all expenses of
shareholders' and Board of Directors' meetings and preparing, printing and
mailing proxies, prospectuses and reports to shareholders; (j) brokers'
commissions, dealers' xxxx-ups and any issue or transfer taxes chargeable in
connection with the Portfolio's transactions; (k) the cost of stock certificates
representing shares of the Portfolio; (l) insurance expenses, including, but not
limited to, the cost of a fidelity bond, directors and officers insurance and
errors and omissions insurance; and (m) litigation and indemnification expenses,
expenses incurred in connection with mergers, and other extraordinary expenses
not incurred in the ordinary course of the Portfolio's business.
7. Duties of the Fund. The Fund shall maintain a currently effective
Registration Statement on the appropriate form and shall file with the
Securities and Exchange Commission ("SEC") such reports and other documents as
may be required under the Securities Act of 1933 as amended and the Investment
Company Act of 1940, as amended (the "1940 Act"), or by the rules and
regulations of the SEC thereunder. The Fund shall keep the Distributor fully
informed with regard to its affairs and the affairs of the Portfolio, shall
furnish the Distributor with a certified copy of all financial statements and a
signed copy of each report prepared by its independent auditors, and shall
cooperate fully in the efforts of the Distributor to negotiate and sell the
Shares and in the performance by the Distributor of all its duties under this
Agreement.
8. Indemnification. The Fund, on behalf of the Portfolio, shall indemnify and
hold harmless the Distributor, against any loss, liability,
claim, damage or expense (including the reasonable cost of investigating or
defending any alleged loss, liability, claim, damage or expenses and reasonable
counsel fees incurred in connection therewith) arising out of its activities as
a Distributor to the Fund or the Portfolio, provided, however, that nothing
herein shall be deemed to protect the Distributor or any director, officer, or
employee thereof against any liability to the Fund or its stockholders, to which
the Distributor or any director, officer, or employee thereof would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties or by reason of reckless disregard of obligations and
duties under this Agreement.
9. Limitation of Liability. Subject to Section 36 of the Act, the Distributor,
and the directors, officers and employees of the Distributor, shall not be
liable to the Fund or the Portfolio for any error of judgment or mistake of law
or for any loss arising out of the performance or non-performance of duties
under this Agreement, except for willful misfeasance, bad faith or gross
negligence in the performance of, or by reason of reckless disregard of,
obligations and duties under this Agreement.
10. Term of Agreement. This Agreement shall continue in effect with respect to
the Portfolio for a period of more than two years from the date hereof only so
long as such continuance is specifically approved at least annually in
conformity with the requirements of the Act; provided, however, that this
Agreement may be terminated at any time, without the payment of any penalty by
the Fund on behalf of the Portfolio, by the Board of Directors of the Fund or,
with respect to the Portfolio, by vote of a majority of the outstanding voting
securities (as defined in the 0000 Xxx) of the Portfolio, or by the Distributor,
on not more than 60 days' nor less than 30 days' written notice to the other
party.
11. Miscellaneous. This Agreement may be amended by mutual written consent. This
Agreement contains the entire agreement between the parties hereto and
supersedes all prior agreements, understandings and arrangements with respect to
the subject matter hereof. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York. Anything herein to the
contrary notwithstanding, this Agreement shall not be construed to require, or
to impose any duty upon either of the parties, to do anything in violation of
any applicable laws or regulations. The Distributor may perform the same
services to the Fund on behalf of other Portfolios, and to other persons or
other entities, including other investment companies.
IN WITNESS WHEREOF, the Fund, on behalf of the Portfolio, and the Distributor
have caused this Agreement to be executed by their duly authorized officers as
of the date first above written.
XXXXXXX X. XXXXXXXXX & CO., INC.
By: Xxxxx X. Xxxxxxx, President
XXXXXXX X. XXXXXXXXX FUND, INC.
By: Xxxxxx X. Xxxxxx, Senior Vice President
