FORM OF DISTRIBUTION AND SERVICES AGREEMENT
XXXXXX BROTHERS INSTITUTIONAL LIQUIDITY SERIES
INSTITUTIONAL CLASS
RESERVE CLASS
INVESTOR CLASS
This Agreement is made as of ___________, 2004, between Xxxxxx Brothers
Institutional Liquidity Series, a Delaware statutory trust ("Trust"), and
Xxxxxxxxx Xxxxxx Management Inc., a New York corporation ("Distributor"), on
behalf of the Institutional Class, Reserve Class and Investor Class (each, a
"Class") of the Trust.
WHEREAS, the Trust is registered under the Investment Company Act of
1940, as amended ("1940 Act"), as an open-end, diversified management investment
company and has the power to establish several separate series of shares
("Series"), with each Series having its own assets and investment policies;
WHEREAS, the Trust desires to retain the Distributor to furnish certain
distribution, shareholder, and administrative services to each Class of each
Series listed in Schedule A attached hereto, and to each Class of such other
Series of the Trust hereinafter established as agreed to from time to time by
the parties, evidenced by an addendum to Schedule A (hereinafter "Series" shall
refer to each Series which is subject to this Agreement, and all agreements and
actions described herein to be made or taken by a Series shall be made or taken
by the Trust on behalf of the Series), and the Distributor is willing to furnish
such services; and
WHEREAS, the Trust has approved a Distribution and Shareholder Services
Plan pursuant to Rule 12b-1 under the 1940 Act ("Plan") with respect to each
Class of each Series;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties agree as follows:
1. The Trust hereby appoints the Distributor as agent to sell the shares
of beneficial interest of each Class of each Series ("Shares") and the
Distributor hereby accepts such appointment. All sales by the Distributor shall
be expressly subject to acceptance by the Trust, acting on behalf of the Series.
The Trust may suspend sales of the Shares of any one or more Series at any time,
and may resume sales at any later time.
2. (a) The Distributor agrees that (i) all Shares sold by the Distributor
shall be sold at the net asset value ("NAV") thereof as described in Section 3
hereof, and (ii) the Series shall receive 100% of such NAV.
(b) The Distributor may enter into agreements, in form and substance
satisfactory to the Trust, with dealers selected by the Distributor, providing
for the sale to such dealers and resale by such dealers of Shares at their NAV.
The Distributor may compensate dealers for services they provide under such
agreements.
(c) The Distributor can use any of the officers and employees of
Xxxxxxxxx Xxxxxx, LLC to provide any of the services or reports required under
this Agreement.
3. The Trust agrees to supply to the Distributor, promptly after the time
or times at which NAV is determined, on each day on which the New York Stock
Exchange is open for unrestricted trading and on such other days as the Board of
Trustees of the Trust ("Trustees") may from time to time determine (each such
day being hereinafter called a "business day"), a statement of the NAV of each
Series, determined in the manner set forth in the then-current Prospectus and
Statement of Additional Information ("SAI") of each Class of each Series. Each
determination of NAV shall take effect as of such time or times on each business
day as set forth in the then-current Prospectus of the applicable Class of each
Series.
4. Upon receipt by the Trust at its principal place of business of a
written order from the Distributor, together with delivery instructions, the
Trust shall, if it elects to accept such order, as promptly as practicable,
cause the Shares purchased by such order to be delivered in such amounts and in
such names as the Distributor shall specify, against payment therefor in such
manner as may be acceptable to the Trust. The Trust may, in its discretion,
refuse to accept any order for the purchase of Shares that the Distributor may
tender to it.
5. (a) All sales literature and advertisements used by the Distributor in
connection with sales of Shares shall be subject to approval by the Trust. The
Trust authorizes the Distributor, in connection with the sale or arranging for
the sale of Shares of any Series, to provide only such information and to make
only such statements or representations as are contained in the Series's
then-current Prospectus and SAI of the applicable Class or in such financial and
other statements furnished to the Distributor pursuant to the next paragraph or
as may properly be included in sales literature or advertisements in accordance
with the provisions of the Securities Act of 1933 ("1933 Act"), the 1940 Act and
applicable rules of self-regulatory organizations. Neither the Trust nor any
Series 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.
(b) Each Series shall keep the Distributor fully informed with
regard to its affairs, shall furnish the Distributor with a certified copy of
all of its financial statements and a signed copy of each report prepared for it
by its independent auditors, and shall cooperate fully in the efforts of the
Distributor to negotiate and sell Shares of such Series and in the Distributor's
performance of all its duties under this Agreement.
6. The Distributor, as agent of each Series and for the account and risk
of each Series, is authorized, subject to the direction of the Trust, to redeem
outstanding Shares of such Series when properly tendered by shareholders
pursuant to the redemption right granted to such Series' shareholders by the
Trust Instrument of the Trust, as from time to time in effect, at a redemption
price equal to the NAV per Share of such Series next determined after proper
tender and acceptance. The Trust has delivered to the Distributor a copy of the
Trust's Trust Instrument as currently in effect and agrees to deliver to the
Distributor any amendments thereto promptly.
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7. The Distributor shall assume and pay or reimburse each Series for the
following expenses of such Series: (i) costs of printing and distributing
reports, prospectuses and SAIs for other than existing shareholders used in
connection with the sale or offering of the Series' Shares; (ii) costs of
preparing, printing and distributing all advertising and sales literature
relating to such Series printed at the instruction of the Distributor; and (iii)
counsel fees and expenses in connection with the foregoing. The Distributor
shall pay all its own costs and expenses connected with the sale of Shares and
may pay the compensation and expenses, including overhead and telephone and
other communication expenses, of organizations and employees that engage in or
support the distribution of Shares.
8. Each Series shall maintain a currently effective Registration
Statement on Form N-1A with respect to the Shares of such Series and shall file
with the Securities and Exchange Commission ("SEC") such reports and other
documents as may be required under the 1933 Act and the 1940 Act or by the rules
and regulations of the SEC thereunder.
Each Series represents and warrants that the Registration Statement,
post-effective amendments, Prospectus and SAI (excluding statements relating to
the Distributor and the services it provides that are based upon written
information furnished by the Distributor expressly for inclusion therein) of
such Series shall not contain any untrue statement of material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading, and that all statements or information
furnished to the Distributor, pursuant to Section 5(b) hereof, shall be true and
correct in all material respects.
9. In addition to the foregoing, the Distributor agrees to provide or
obtain certain administrative and shareholder services for each Class of each
Series. Such services shall include, but are not limited to, administering
periodic investment and periodic withdrawal programs; researching and providing
historical account activity information for shareholders requesting it;
preparing and mailing account and confirmation statements to account holders;
preparing and mailing tax forms to account holders; serving as custodian for
retirement plans investing in Shares; dealing appropriately with abandoned
accounts; collating and reporting the number of Shares attributable to each
state for blue sky registration and reporting purposes; identifying and
reporting transactions exempt from blue sky registration requirements; and
providing and maintaining ongoing shareholder services for the duration of the
shareholders' investment in the each Class of each Series, which may include
updates on performance, total return, other related statistical information, and
a continual analysis of the suitability of the investment in the each Class of
each Series. The Distributor may subcontract to third parties some or all of its
responsibilities to the Series under this paragraph. The Distributor may pay
compensation and expenses, including overhead and telephone and other
communication expenses, to organizations and employees who provide such
services.
10. As compensation for the distribution, shareholder and administrative
services provided under this Agreement, the Distributor shall receive from each
Class of each Series a fee at the rate and under the terms and conditions set
forth in the Plan adopted by the appplicable Class of the Series, as such Plan
may be amended from time to time. In addition to the expenditures specifically
authorized herein, the Distributor may spend with respect to a Class such
amounts as it deems appropriate for any purpose consistent with the Plan, as
amended from time to time.
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11. The Distributor shall prepare, at least quarterly, reports for the
Trustees showing expenditures under this Agreement and the purposes for which
such expenditures were made. Such reports shall be in a format suitable to
ensure compliance with the applicable requirements of the SEC and the National
Association of Securities Dealers.
12. (a) This Agreement, as amended, shall become effective on the date
first written above and shall remain in full force and effect until _________,
2005 and may be continued from year to year thereafter; provided, that such
continuance shall be specifically approved each year by the Trustees or by a
majority of the outstanding voting securities of each Class of the Series, and
in either case, also by a majority of the Trustees who are not interested
persons of the Trust or the Distributor ("Disinterested Trustees") and by a
majority of those Disinterested Trustees who have no direct or indirect
financial interest in the Plan or this Agreement ("Rule 12b-1 Trustees"). This
Agreement may be amended as to any Series with the approval of the Trustees or
of a majority of the outstanding voting securities of the applicable Class of
such Series; provided, that in either case, such amendment also shall be
approved by a majority of the Disinterested Trustees and the Rule 12b-1
Trustees.
(b) Either party may terminate this Agreement without the payment of
any penalty, upon not more than sixty days' nor less than thirty days' written
notice delivered personally or mailed by registered mail, postage prepaid, to
the other party; provided, that in the case of termination by any Series, such
action shall have been authorized (i) by resolution of the Trustees, (ii) by
vote of a majority of the outstanding voting securities of the applicable Class
of such Series or (iii) by written consent of a majority of the Disinterested
Trustees or the Rule 12b-1 Trustees.
(c) This Agreement shall automatically terminate if it is assigned
by the Distributor.
(d) Any question of interpretation of any term or provision of this
Agreement having a counterpart in or otherwise derived from a term or provision
of the 1940 Act shall be resolved by reference to such term or provision of the
1940 Act and to interpretation thereof, if any, by the United States courts or,
in the absence of any controlling decision of any such court, by rules,
regulations or orders of the SEC validly issued pursuant to the 1940 Act.
Specifically, the terms "interested persons," "assignment" and "vote of a
majority of the outstanding voting securities," as used in this Agreement, shall
have the meanings assigned to them by Section 2(a) of the 1940 Act. In addition,
when the effect of a requirement of the 1940 Act reflected in any provision of
this Agreement is modified, interpreted or relaxed by a rule, regulation or
order of the SEC, whether of special or of general application, such provision
shall be deemed to incorporate the effect of such rule, regulation or order. The
Trust and the Distributor may from time to time agree on such provisions
interpreting or clarifying the provisions of this Agreement as, in their joint
opinion, are consistent with the general tenor of this Agreement and with the
specific provisions of this Section 12(d). Any such interpretations or
clarifications shall be in writing signed by the parties and annexed hereto, but
no such interpretation or clarification shall be effective if in contravention
of any applicable federal or state law or regulations, and no such
interpretation or clarification shall be deemed to be an amendment of this
Agreement.
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No term or provision of this Agreement shall be construed to require the
Distributor to provide distribution, shareholder, or administrative services to
any series of the Trust other than the Series, or to require a Class or any
Series to pay any compensation or expenses that are properly allocable, in a
manner approved by the Trustees, to a class or series of the Trust other than
that Class or such Series.
(e) This Agreement is made and to be principally performed in the
State of New York, and except insofar as the 1940 Act or other federal laws and
regulations may be controlling, this Agreement shall be governed by, and
construed and enforced in accordance with, the internal laws of the State of New
York.
(f) This Agreement is made by the Trust solely with respect to the
Series, and the obligations created hereby with respect to a Class of one Series
bind only assets belonging to that Class of that Series and are not binding on
any other series of the Trust.
13. The Distributor or one of its affiliates may from time to time deem
it desirable to offer to the list of shareholders of a Class of each Series the
shares of other mutual funds for which it acts as Distributor, including other
series of the Trust or other products or services; however, any such use of the
list of shareholders of any Series shall be made subject to such terms and
conditions, if any, as shall be approved by a majority of the Disinterested
Trustees.
14. The Distributor shall look only to the assets of a Class of a Series
for the performance of this Agreement by the Trust on behalf of such Series, and
neither the shareholders, the Trustees nor any of the Trust's officers,
employees or agents, whether past, present or future, shall be personally liable
therefor.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
duly executed by their duly authorized officers and under their respective
seals.
XXXXXX BROTHERS INSTITUTIONAL LIQUIDITY SERIES
___________________________________________
By:
Title:
XXXXXXXXX XXXXXX MANAGEMENT INC.
___________________________________________
By:
Title:
Date: _______________, 2004
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XXXXXX BROTHERS INSTITUTIONAL LIQUIDITY SERIES
INSTITUTIONAL CLASS
RESERVE CLASS
INVESTOR CLASS
DISTRIBUTION AND SERVICES AGREEMENT
SCHEDULE A
The Institutional Class of the Series of Xxxxxx Brothers
Institutional Liquidity Series currently subject to this
Agreement are as follows:
Xxxxxx Brothers Institutional Liquidity Fund
Xxxxxx Brothers Prime Money Fund
Xxxxxx Brothers U.S. Treasury Fund
The Reserve Class of the Series of Xxxxxx Brothers
Institutional Liquidity Series currently subject to this
Agreement are as follows:
Xxxxxx Brothers Institutional Liquidity Fund
Xxxxxx Brothers Prime Money Fund
Xxxxxx Brothers U.S. Treasury Fund
The Investor Class of the Series of Xxxxxx Brothers
Institutional Liquidity Series currently subject to this
Agreement are as follows:
Xxxxxx Brothers Institutional Liquidity Fund
Xxxxxx Brothers Prime Money Fund
Xxxxxx Brothers U.S. Treasury Fund
Date: _________, 2004
