Exhibit 6(A)
DISTRIBUTION AGREEMENT
AGREEMENT made this 3rd day of July, 1989, between PCS
CASH FUND, INC. a Maryland Corporation (the "Fund"), and XXXXXX
XXXXXXX & CO. INCORPORATED, a Delaware corporation (the
"Distributor").
W I T N E S S E T H
WHEREAS, the Fund is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as a
diversified open-end management investment company and it is in
the interest of the Fund to offer the shares of its PCS Money
Market Portfolio (the "Portfolio") for sale continuously and to
appoint a principal underwriter for the purpose of facilitating
such offers and sales;
WHEREAS, the Fund and the Distributor wish to enter
into an agreement with each other with respect to the continuous
offering of the Portfolio's shares of common stock ("Shares"), to
commence after the effectiveness of its initial registration
statement filed pursuant to the Securities Act of 1933, as
amended (the "1933 Act"), and the 1940 Act.
NOW, THEREFORE, the parties agree as follows:
Section 1. Appointment of the Distributor.
The Fund hereby appoints the Distributor its exclusive
underwriter in connection with the offering and sale of the
Shares on the terms set forth in this Agreement and the
Distributor hereby accepts such appointment and agrees to act
hereunder.
Section 2. Services and Duties of the Distributor.
(a) The Distributor agrees to sell, as agent for
the Fund, from time to time during the term of this Agreement,
Shares upon the terms described in the Prospectus. As used in
this Agreement, the term "Prospectus" shall mean the prospectus
pertaining to the Portfolio included as part of the Fund's
Registration Statement, as such prospectus may be amended or
supplemented from time to time, and the term "Registration
Statement" shall mean the Registration Statement most recently
filed from time to time by the Fund with the Securities and
Exchange Commission and effective under the 1933 Act and the 1940
Act, as such Registration Statement is amended by any amendments
thereto at the time in effect.
(b) Upon commencement of the Portfolio's
operations, the Distributor will hold itself available to receive
1
orders, satisfactory to the Distributor, for the purchase of
Shares and will accept such orders on behalf of the Fund and will
transmit such orders as are so accepted to the fund's transfer
and shareholder servicing agent as promptly as practicable. The
Distributor shall promptly forward to the Fund's Custodian funds
received in respect of purchases of Shares in accordance with the
instructions of the Fund's Administrator. Purchase orders shall
be deemed effective at the time and in the manner set forth in
the Prospectus.
(c) The offering price of the Shares shall be the
net asset value per Share determined as set forth in the
Prospectus. The Fund shall furnish the Distributor, with all
possible promptness, an advice of each computation of net asset
value.
(d) The Distributor shall not be obligated to
sell any certain number of Shares and nothing herein contained
shall prevent the Distributor from entering into like
distribution arrangements with other investment companies.
Section 3. Duties of the Fund.
(a) The Fund agrees to sell Shares so long as it
has Shares available for sale and to cause the Fund's transfer
and shareholder servicing agent to record on its books the
ownership of (or delivery certificates, if any, for) such Shares
registered in such names and amounts as the Distributor has
requested in writing or other means of data transmission, as
promptly as practicable after receipt by the Fund of the net
asset value thereof and written request of the Distributor
therefor.
(b) The Fund shall keep the Distributor fully
informed with regard to its affairs as they pertain to the
Portfolio and 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 of the Fund, and this shall include one
certified copy, upon request by the Distributor, of all financial
statements prepared for the Fund by independent accountants and
such reasonable number of copies of its most current Prospectus
and annual and interim reports as the Distributor may request and
shall cooperate fully in the efforts of the Distributor to sell
and arrange for the sale of the Shares and in the performance of
the Distributor under this Agreement.
(c) The Fund shall take, from time to time, such
steps, including payment of the related filing fee, as may be
necessary to register the Shares under the 1933 Act to the end
that there will be available for sale such number of Shares as
the Distributor may be expected to sell. The Fund agrees to file
2
from time to time such amendments, reports and other documents as
may be necessary in order that there may be no untrue statement
of a material fact in a Registration Statement or Prospectus, or
necessary in order that there may be no omission to state a
material fact in the Registration Statement or Prospectus which
omission would make the Statements therein misleading.
(d) The Fund shall use its best efforts to
qualify and maintain the qualification of an appropriate number
of the Shares for sale under the securities laws of such states
as the Distributor and the Fund may approve, and, if necessary or
appropriate in connection therewith, to qualify and maintain the
qualification of the Fund as a broker or dealer in such states;
provided that the Fund shall not be required to amend its
Articles of Incorporation or By-Laws to comply with the laws of
any state, to maintain an office in any state, to change the
terms of the offering of the 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 the offering of the Shares. The Distributor shall
furnish such information and other material relating to its
affairs and activities as may be required by the Fund in
connection with such qualifications.
Section 4. Expenses.
(a) The Fund shall bear all costs and expenses of
the continuous offering of the Shares in connection with: (i)
fees and disbursements of its counsel and independent
accountants, (ii) the preparation, filing and printing of any
registration statements and/or prospectuses required to be filed
by and under the federal and state securities laws, (iii) the
preparation and mailing of annual and interim reports,
prospectuses and proxy materials to shareholders and (iv) the
qualifications of Shares for sale and of the Fund as a broker or
dealer under the securities laws of such states or other
jurisdictions as shall be selected by the Fund and the
Distributor pursuant to Section 3(d) hereof and the cost and
expenses payable to each such state for continuing qualification
therein.
(b) The Distributor shall bear (i) the costs and
expenses of preparing, printing and distributing any materials
not prepared by the Fund and other materials used by the
Distributor in connection with its offering of the Shares for
sale to the public, including the additional cost of printing
copies, at printer's over-run cost, of the Prospectus and of
annual and interim reports to shareholders other than copies
thereof required for distribution to shareholders or for filing
with any federal and state securities authorities, (ii) any
expenses of advertising incurred by the Distributor in connection
3
with such offering and (iii) the expenses of registration or
qualification of the Distributor as a dealer or broker under
federal or state laws and the expenses of continuing such
registration or qualification.
Section 5. Indemnification. The Fund 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 1933 Act, free and harmless from and
against any and all claims, demand, 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 1933
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 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 biased 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 Fund
for use in the Registration Statement or Prospectus; provided,
however, that this indemnity agreement, to the extent that it
might require indemnity of any person who is also an officer or
Director of the Fund or who controls the Fund within the meaning
of Section 15 of the 1933 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 1933 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 Fund 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. Any such indemnification shall
be payable only from the assets of the Portfolio or other assets
lawfully available for such purpose. The Fund's agreement to
indemnify the Distributor, its officers and Directors and any
such controlling person as aforesaid is expressly conditioned
upon the Fund's being promptly notified of any action brought
against the Distributor, its officers or Directors, or any such
controlling person, such notification to be given to the Fund at
its principal business office. The Fund agrees promptly to
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.
4
The Distributor agrees to indemnify, defend and hold
the Fund, its Directors and officers and any person who controls
the Fund, if any, 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 against such claims, demands or
liabilities and any counsel fees incurred in connection
therewith) which the Fund, its Directors or officers or any such
controlling person may incur under the 1933 Act or under common
law or otherwise, but only to the extent that such liability or
expense incurred by the Fund, 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 Fund for use in the preparation of the
Registration Statement or Prospectus or shall arise out of or be
based upon any alleged omission to state a material fact in such
information or a fact necessary to make such information not
misleading, it being understood that the Fund will rely upon the
information provided by the Distributor for use in the
preparation of the Registration Statement and Prospectus. The
Distributor's agreement to indemnify the Fund, its Directors and
officers, and any such controlling person as aforesaid is
expressly conditioned upon the Distributor's being promptly
notified of any action brought against the Fund, its Directors or
officers or any such controlling person, such notification to be
given to the Distributor at its principal business office.
Section 6. Compliance with Securities Laws. The Fund
represents that it is registered as a diversified open-end
management investment company under the 1940 Act, and agrees that
it will comply with the provisions of the 1940 Act and of the
rules and regulations thereunder. The Fund and the Distributor
each agree to comply with the applicable terms and provisions of
the 1940 Act, the 1933 Act and, subject to the provisions of
Section 3(d), applicable state "Blue Sky" laws. The Distributor
agrees to comply with the applicable terms and provisions of the
Securities Exchange Act of 1934.
Section 7. Term of Agreement; Termination. This
Agreement shall commence on the date first set forth above. This
Agreement shall continue in effect for a period 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 1940 Act.
This Agreement shall terminate automatically in the
event of its assignment (as defined by the 1940 Act). In
addition, this Agreement may be terminated by either party at any
time, without penalty, on not more than sixty days' nor less than
thirty days' written notice to the other party.
5
Section 8. Compensation. As compensation for the
services rendered by the Distributor during the term of this
Agreement, the Fund shall pay to the Distributor such fees as
shall be agreed upon from time to time in writing by the
Distributor and the Fund.
Section 9. Notices. Any notice required to be given
pursuant to this Agreement shall be deemed duly given if
delivered or mailed by registered mail, postage prepaid, (1) to
the Distributor at Xxxxxx Xxxxxxx & Co. Incorporated, 1221 Avenue
of the Americas, 21st Floor, New York, N.Y. 10020 Attention:
Xxxxxx X. Xxxxx, or (2) to the Fund at PCS Cash Fund, Inc., 1221
Avenue of the Americas, 00xx Xxxxx, Xxx Xxxx, X.X. 00000,
Xxxxxxxxx: Secretary.
Section 10. Governing Law. This Agreement shall be
governed and construed in accordance with the laws of the State
of New York.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement on the day and year first above written.
XXXXXX XXXXXXX & CO. INCORPORATED
By /s/ Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
PCS CASH FUND, INC.
By /s/ Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
President and Director
6
