DISTRIBUTION AGREEMENT
WATERHOUSE INVESTORS CASH MANAGEMENT FUND, INC.
000 XXXX XXXXXX
XXX XXXX, XX 00000
, 1995
Funds Distributor, Inc.
Xxx Xxxxxxxx Xxxxx
Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Dear Sirs:
This is to confirm that, in consideration of the agreements hereinafter
contained, the above-named investment company (the "Fund") has agreed that you
shall be, for the period of this agreement, the distributor of (a) shares of
each Series of the Fund set forth on Exhibit A hereto, as such Exhibit may be
revised from time to time (each, a "Series") or (b) if no Series are set forth
on such Exhibit, shares of the Fund. For purposes of this agreement, the term
"Shares" shall mean the authorized shares of the relevant Series, if any, and
otherwise shall mean the Fund's authorized shares.
1. Services as Distributor
1.1 You will act as agent for the distribution of Shares covered
by, and in accordance with, the registration statement and prospectus of the
Fund then in effect under the Securities Act of 1933, as amended, and will
transmit promptly any orders received by you for purchase or redemption of
Shares to the Transfer and Dividend Disbursing Agent for the Fund of which the
Fund has notified you in writing.
1.2 You agree to use your best efforts to solicit orders for the
sale of Shares in accordance with the terms and conditions of the aforementioned
prospectus. It is contemplated that you may enter into sales or servicing
agreements with securities dealers, financial institutions and other industry
professionals, such as investment advisers, accountants and estate planning
firms, and in so doing you will act only on your own behalf as principal.
1.3 You shall act as distributor of Shares in compliance with all
applicable laws, rules and regulations, including, without limitation, all rules
and regulations made or adopted pursuant to the Investment Company Act of 1940,
as amended (the "1940 Act"), by the Securities and Exchange Commission or any
securities association registered under the Securities Exchange Act of 1934, as
amended, and the Xxxxx-Xxxxxxxx Act to the extent applicable.
1.4 Whenever in their judgment such action is warranted by unusual
market, economic or political conditions, or by abnormal circumstances of any
kind deemed by the parties hereto to
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render sales of a Fund's Shares not in the best interest of the Fund, the
parties hereto may decline to accept any orders for, or make any sales of, any
Shares until such time as those parties deem it advisable to accept such orders
and to make such sales; and each party shall advise promptly the other party of
any such determination.
1.5 The Fund agrees to pay all costs and expenses in connection
with the registration of Shares under the Securities Act of 1933, as amended,
and all expenses in connection with maintaining facilities for the issue and
transfer of Shares and for supplying information, prices and other data to be
furnished by the Fund hereunder, and all expenses in connection with the
preparation and printing of the Fund's prospectuses and statements of additional
information for regulatory purposes and for distribution to shareholders;
provided however, that the Fund shall not pay any of the costs of advertising or
promotion for the sale of Shares.
1.6 The Fund agrees to execute any and all documents and to furnish
any and all information and otherwise use its best efforts to take all actions
that may be reasonably necessary in the discretion of the Fund's officers in
connection with the qualification of Shares for sale in such states as you may
designate to the Fund and the Fund may approve, and the Fund agrees to pay all
expenses that may be incurred in connection with such qualification; provided,
however that the Fund shall not be required to qualify to do business as a
foreign corporation in any jurisdiction. You shall pay all expenses connected
with your own qualification as a dealer under state or Federal laws and, except
as otherwise specifically provided in this agreement, all other expenses
incurred by you in connection with the sale of Shares as contemplated in this
agreement.
1.7 The Fund shall furnish you from time to time, for use in
connection with the sale of Shares, such information with respect to the Fund or
any relevant Series and the Shares as you 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 information, when so
signed by the Fund's officers, shall be true and correct. The Fund also shall
furnish you upon request with: (a) semi-annual reports and annual audited
reports of the Fund's books and accounts made by independent public accountants
regularly retained by the Fund, (b) quarterly earnings statements prepared by
the Fund, (c) a monthly itemized list of the securities in the Fund's or, if
applicable, each Series' portfolio, (d) monthly balance sheets as soon as
practicable after the end of each month, and (e) from time to time such
additional information regarding the Fund's financial condition as you may
reasonably request.
1.8 The Fund represents to you that all registration statements and
prospectuses filed by the Fund with the Securities and Exchange Commission under
the Securities Act of 1933, as amended, and under the 1940 Act, as amended, with
respect to the Shares have been carefully prepared in conformity with the
then-current requirements of said Acts and rules and regulations of the
Securities and Exchange Commission thereunder. As used in this agreement the
terms "registration statement" and "prospectus" shall mean any registration
statement and prospectus, including the statement of additional information
incorporated by reference therein, filed with the Securities and Exchange
Commission and any amendments and supplements thereto that at any time shall
have been filed with said Commission. The Fund represents and warrants to you
that any registration statement and prospectus, when such registration statement
becomes effective, will contain all statements required to be stated therein in
conformity with said Acts and the rules
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and regulations of said Commission; that all statements of fact contained in any
such registration statement and prospectus will be true and correct when such
registration statement becomes effective; and that neither any registration
statement nor any prospectus 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,
in the light of the circumstances under which they were made, not misleading.
The Fund 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 as, in the light of future developments, may, in
the opinion of the Fund's counsel, 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 you to do so,
you may, at your option, terminate this agreement or decline to make offers of
the Fund's securities until such amendments are made. The Fund shall not file
any amendment to any registration statement or supplement to any prospectus
without giving you 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, of whatever character, as the Fund may deem
advisable, such right being in all respects absolute and unconditional.
1.9 The Fund authorizes you and any dealers with whom you have
entered into dealer agreements to use any prospectus in the then-current form
furnished by the Fund in connection with the sale of Shares. The Fund agrees to
indemnify, defend and hold you, your several officers and directors, and any
person who controls you within the meaning of Section 15 of the Securities Act
of 1933, as amended, 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 you, your officers and directors, or any such
controlling persons, may incur under the Securities Act of 1933, as amended, the
1940 Act, as amended, or common law or otherwise, arising out of or on the basis
of any untrue statement, or alleged untrue statement, of a material fact
required to be stated in either any registration statement or 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, in the light of
the circumstances under which they were made, not misleading, except that the
Fund's agreement to indemnify you, your officers or directors, and any such
controlling person will not be deemed to cover any such claim, demand, liability
or expense to the extent that it arises out of or is based upon any such untrue
statement, alleged untrue statement, omission or alleged omission made in any
registration statement, any prospectus or any statement of additional
information in reliance upon information furnished by you, your officers,
directors or any such controlling person to the Fund or its representatives for
use in the preparation thereof, and except that the Fund's agreement to
indemnify you and the Fund's representations and warranties set out in paragraph
1.8 of this Agreement will not be deemed to cover any liability to the Fund or
its shareholders to which you would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of your duties, or
by reason of your reckless disregard of your obligations and duties under this
Agreement ("Disqualifying Conduct"). The Fund's agreement to indemnify you,
your officers and directors, and any such controlling person, as aforesaid, is
expressly conditioned upon the Fund being notified of any action brought against
you, your
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officers or directors, or any such controlling person, such notification to be
given by letter, by facsimile or by telegram addressed to the Fund at its
address set forth above within a reasonable period of time 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, (i)
except to the extent the Fund's ability to defend such action has been
materially adversely affected by such failure, or (ii) otherwise than on account
of the Fund's indemnity agreement contained in this paragraph 1.9. 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 you. In the event
the Fund elects to assume the defense of any such suit and retain counsel of
good standing approved by you, the defendant or 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, the
Fund will reimburse you, your officers and directors, or the controlling person
or persons named as defendant or defendants in such suit, for the fees and
expenses of any counsel retained by you or them, subject to the right of the
Fund to assume the defense of such suit with counsel of good standing at any
time prior to the settlement or final determination thereof. The Fund's
indemnification agreement contained in this paragraph 1.9 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
you, your officers and directors, or any controlling person, and shall survive
the delivery of any Shares. This agreement of indemnity will inure exclusively
to your benefit, to the benefit of your several officers and directors, and
their respective estates, and to the benefit of any controlling persons and
their successors. The Fund agrees promptly to notify you of the commencement of
any litigation or proceedings against the Fund or any of its officers or Board
members in connection with the issue and sale of Shares.
1.10 You agree to indemnify, defend and hold the Fund, its several
officers and Board members, and any person who controls the Fund within the
meaning of Section 15 of the Securities Act of 1933, as amended, 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
Fund, its officers or Board members, or any such controlling person, may incur
under the Securities Act of 1933, as amended, the 1940 Act, as amended, or under
common law or otherwise, but only to the extent that such liability or expense
incurred by the Fund, its officers or Board members, or such controlling person
resulting from such claims or demands, (a) shall arise out of or be based upon
any unauthorized sales literature, advertisements, information, statements or
representations or any Disqualifying Conduct in connection with the offering and
sale of any Shares, or (b) shall arise out of or be based upon any untrue, or
alleged untrue, statement of a material fact contained in information furnished
in writing by you to the Fund specifically for use in the Fund's registration
statement 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 you to the Fund and required to be stated in
such answers or necessary to make such information, in the light of the
circumstances under which it was made, not misleading. Your agreement to
indemnify the Fund, its officers and Board members, and any such controlling
person, as aforesaid, is expressly conditioned upon
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your being notified of any action brought against the Fund, its officers or
Board members, or any such controlling person, such notification to be given by
letter, by facsimile or by telegram addressed to you at your address set forth
above within a reasonable period of time after the summons or other first legal
process shall have been served. You shall have the right to control the defense
of such action, with counsel of your own choosing, satisfactory to the Fund, if
such action is based solely upon such alleged misstatement or omission on your
part, and in any other event the Fund, its officers or Board members, 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 you of
any such action shall not relieve you from any liability that you may have to
the Fund, its officers or Board members, or to such controlling person by reason
of any such untrue, or alleged untrue, statement or omission, or alleged
omission, (i) except to the extent your ability to defend such action has been
materially adversely affected by such failure, or (ii) otherwise than on account
of your indemnity agreement contained in this paragraph 1.10. This agreement of
indemnity will inure exclusively to the Fund's benefit, to the benefit of the
Fund's officers and Board members, and their respective estates, and to the
benefit of any controlling persons and their successors. You agree promptly to
notify the Fund of the commencement of any litigation or proceedings against you
or any of your officers or directors in connection with the issue and sale of
Shares.
1.11 No Shares shall be offered by either you or the Fund under any
of the provisions of this agreement and no orders for the purchase or sale of
such 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
Securities Act of 1933, as amended, or if and so long as a current prospectus as
required by Section 10 of said Act, as amended, is not on file with the
Securities and Exchange Commission; provided, however, that nothing contained in
this paragraph 1.11 shall in any way restrict or have an application to or
bearing upon the Fund's obligation to repurchase any Shares from any shareholder
in accordance with the provisions of the Fund's prospectus or charter documents.
1.12. The Fund agrees to advise you immediately in writing:
(a) of any request by the Securities and Exchange Commission
for amendments to the registration statement or prospectus then in effect or for
additional information;
(b) 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 then in effect or the initiation of any
proceeding for that purpose;
(c) of the happening of any event that in the judgment of the
Fund's Board of Directors makes untrue any statement of a material fact made in
the registration statement or prospectus then in effect or that requires the
making of a change in such registration statement or prospectus in order to make
the statements therein not misleading in any material respect; and
(d) of all declarations of effectiveness and other actions of
the Securities and Exchange Commission with respect to any amendments to the
registration statement or
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prospectus that may from time to time be filed with the Securities and Exchange
Commission.
2. Offering Price
Shares of any class or series of the Fund offered for sale by you shall
be offered at a price per share (the "offering price") equal to (a) the net
asset value (determined in the manner set forth in the Fund's charter documents)
plus (b) a sales charge, if any, and except to those persons set forth in the
then-current prospectus, which shall be the percentage of the offering price of
such Shares as set forth in the Fund's then-current prospectus. The offering
price, if not an exact multiple of one cent, shall be adjusted to the nearest
cent. In addition, Shares of any class of the Fund offered for sale by you may
be subject to a contingent deferred sales charge, to the extent set forth in the
Fund's then-current prospectus. You shall be entitled to receive any sales
charge or contingent deferred sales charge in respect of the Shares. Any
payments to dealers shall be governed by a separate agreement between you and
such dealer and the Fund's then-current prospectus.
3. Term
This Agreement shall become effective with respect to the Fund as of
the date hereof and will continue for an initial two-year term and will continue
thereafter so long as such continuance is specifically approved at least
annually (i) by the Fund's Board or (ii) by a vote of a majority (as defined in
the 0000 Xxx) of the Shares of the Fund or the relevant Series, as the case may
be, provided that in either event its continuance also is approved by a majority
of the Board members who are not "interested persons" (as defined in said Act)
of any party to this Agreement and who have no direct or indirect financial
interest in this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This agreement is terminable with respect
to any Series or any Fund, without penalty, on not less than sixty days notice,
by the Fund's Board of Directors, by vote of a majority (as defined in the 0000
Xxx) of the outstanding voting securities of such Fund, or by you. This
Agreement shall terminate automatically in the event of its "assignment" (as
defined in the 1940 Act).
4. Miscellaneous
4.1 The Fund recognizes that your directors, officers and employees
may from time to time serve as directors, trustees, officers and employees of
corporations and business trusts (including other investment companies), and
that you or your affiliates may enter into distribution or other agreements with
such other corporations and trusts.
4.2 No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which an enforcement of the change, waiver, discharge or
termination is sought.
4.3 This Agreement shall be governed by the internal laws of the
State of New York without giving effect to principles of conflicts of laws.
4.4 If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
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This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors.
4.5 Funds Distributor, Inc. ("FDI") represents and warrants that
it is a member of the National Association of Securities Dealers ("NASD") and
agrees to abide by all of the rules and regulations of the NASD, including,
without limitation, its Rules of Fair Practice. FDI agrees to comply with all
applicable federal and state laws, rules and regulations. FDI agrees to notify
the Fund immediately in the event of its expulsion or suspension by the NASD.
Expulsion of FDI by the NASD will automatically terminate this Agreement
immediately without notice. Suspension of FDI by the NASD will terminate this
Agreement effective immediately upon written notice of termination to FDI from
the Fund.
4.6 All notices or other communications hereunder to either party
shall be in writing and shall be deemed sufficient if mailed to such party at
the address of such party set forth on page 1 of this Agreement or at such other
address as such party may be designated by written notice to the other, or by
telex, telecopier, telegram or similar means of same day delivery (with a
confirming copy by mail as provided herein).
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Please confirm that the foregoing is in accordance with your
understanding and indicate your acceptance hereof by signing below, whereupon it
shall become a binding agreement between us.
Very truly yours,
WATERHOUSE INVESTORS CASH
MANAGEMENT FUND, INC.
By: ____________________________
Accepted:
FUNDS DISTRIBUTOR, INC.
By: ________________________________
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EXHIBIT A
Series of Funds
WATERHOUSE INVESTORS CASH MANAGEMENT FUND, INC.
Money Market Portfolio
U.S. Government Portfolio
Municipal Portfolio
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