DISTRIBUTION AGREEMENT
Exhibit (e)(6)
This DISTRIBUTION AGREEMENT (this “Agreement”) is made this 1st day of December,
2008 by and between Xxxx Xxxxx Partners Variable Income Trust (“Investment Company”), a Maryland
business trust, and Xxxx Xxxxx Investor Services, LLC (“Distributor”).
The Investment Company is registered with the Securities and Exchange Commission (“SEC”) as an
open-end management investment company under the Investment Company Act of 1940, as amended (the
“1940 Act”), and has registered its shares (“Shares”) for each of the series thereof listed on
Appendix A (each such series, a “Fund”), as such Appendix A may be amended from time to time by
agreement between the Distributor and the Investment Company, for sale to the public under the
Securities Act of 1933, as amended (the “1933 Act”) and filed appropriate notices under various
state securities laws.
This Agreement shall be deemed for all purposes to constitute a separate and discrete
agreement with respect to each Fund, and no Fund shall be responsible or liable for any of the
obligations of any other Fund under this Agreement or otherwise, notwithstanding anything to the
contrary contained herein. The use of the term “Fund” below shall refer to each Fund singly.
This Agreement is intended to replace in its entirety any earlier dated distribution agreement
between the Distributor and the Investment Company with respect to the Fund, and any other such
distribution agreement shall be deemed terminated upon the effectiveness of this Agreement.
* * *
WHEREAS, the Investment Company wishes to retain the Distributor as the sole and exclusive
principal underwriter in connection with the offering and sale of the Shares and to furnish certain
other services to the Investment Company as specified in this Agreement; and
WHEREAS, this Agreement has been approved, with respect to the Fund, by separate votes of the
Investment Company’s Board of Trustees (“Board”) and of those Board members who are not “interested
persons” of the Investment Company, as defined in the 1940 Act and who have no direct or indirect
financial interest in the operation of the plan of distribution adopted pursuant to Rule 12b-1
under the 1940 Act (“Plan”) of the Fund or in any agreements related to such plan (“Independent
Board Members”) in conformity with Section 15 of, and Rule 12b-1 under, the 1940 Act; and
WHEREAS, the Distributor is willing and able to furnish such services on the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the promises and mutual covenants herein contained, it is
agreed as follows:
1. (a) The Investment Company hereby appoints the Distributor as the sole and exclusive
principal underwriter and distributor in connection with the offering and sale of Shares of the
Fund to the public directly and through registered and qualified securities dealers, banks and
other intermediaries (collectively, “Intermediaries”), and the Distributor hereby accepts such
appointment, on the terms and for the period set forth in this Agreement. The Distributor, as agent
for the Investment Company, shall, in accordance with applicable federal and state law and
the organizational documents of the Investment Company and the registration statement most
recently filed with respect to the Fund by the Investment Company with the SEC and effective under
the 1940 Act and 1933 Act, as such registration statement may be amended or supplemented from time
to time (“Registration Statement”): (i) promote the Fund; (ii) solicit orders for the purchase of
the Shares subject to such terms and conditions as the Investment Company may specify; and
(iii) accept orders for the purchase of the Shares on behalf of the Investment Company
(collectively, “Distribution Services”). The Distributor shall comply with all applicable federal
and state laws and offer the Shares of the Fund on an agency or “best efforts” basis under which
the Investment Company shall issue only such Shares as are actually sold.
(b) The Distributor may pay for ongoing shareholder liaison services, including responding to
shareholder inquiries, providing shareholders with information on their investments, and any other
services now or hereafter deemed to be appropriate subjects for the payments of “service fees”
under Conduct Rule 2830 of the Financial Industry Regulatory Authority (“FINRA”) (collectively,
“Shareholder Services”), as appropriate.
2. The Distributor may also enter into dealer or similar agreements with qualified
Intermediaries it may select for the performance of Distribution Services and Shareholder Services.
The Distributor may also enter into agreements with Intermediaries and other qualified entities to
perform recordkeeping, shareholder servicing and sub-accounting services. In making such
arrangements, the Distributor shall act only as principal and not as agent for the Investment
Company. No such Intermediary is authorized to act as agent for the Investment Company in
connection with the offering or sale of Shares to the public or otherwise, except for the limited
purpose of determining the time as of which orders for the purchases, sales and exchanges of Shares
are deemed to have been received.
3. The public offering price of the Shares of the Fund shall be the net asset value per share
(as determined by the Investment Company) of the outstanding Shares of the Fund (or class thereof)
next determined after receipt of an order by the Fund or its designated agent plus any applicable
sales charge, as described in the Registration Statement.
4. As compensation for providing Distribution Services under this Agreement, the Distributor
shall retain the sales charge, if any, on purchases of Shares or retain deferred sales charges upon
redemption of Shares, as set forth in the Registration Statement. The Distributor is authorized to
collect the gross proceeds derived from the sale of the Shares, remit the net asset value thereof
to the Investment Company upon receipt of the proceeds and retain the sales charge, if any. The
Distributor shall receive from the Fund fees at the rates and under the terms and conditions of the
Plan adopted by the Investment Company with respect to the Fund, as such Plan is in effect from
time to time, and subject to any further limitations on such fees as the Board may impose. The
Distributor may reallow any or all of the sales charges that it has received under this Agreement
to such Intermediaries as it may from time to time determine, consistent with the Registration
Statement and applicable law. The Distributor may pay any or all of the distribution fees and
service fees that it has received under this Agreement to such Intermediaries as it may from time
to time determine, consistent with the Registration Statement and applicable law. The Distributor
may securitize or borrow against amounts to be received by the Distributor under a Plan, in which
case payments of the fees under the Plan by the Fund may
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be made directly to the lender,
security-holder or an agent thereof pursuant to written instructions
of the Distributor; provided, however, that no such arrangement shall be deemed to give rise
to any obligation on the part of an Investment Company or its Board to continue such payments if
the Board determines that such payments are not in the best interests of the Fund or its
shareholders, or to create any obligation of the Fund or Investment Company to the lender.
5. As used in this Agreement, the terms “Prospectus” and “Statement of Additional Information”
shall mean, respectively, the form of prospectus and statement of additional information with
respect to the Fund filed by the Investment Company as part of the Registration Statement, or as
they may be amended or supplemented from time to time.
6. The Distributor shall print and distribute to prospective investors current Prospectuses,
and shall print and distribute, upon request, to prospective investors current Statements of
Additional Information, and may print and distribute such other sales literature, reports, forms
and advertisements in connection with the sale and offers of sale of the Shares as it deems
appropriate. In connection with such sales and offers of sale, the Distributor and any Intermediary
shall give only such information and make only such statements or representations as are contained
in the Registration Statement, or in information furnished in writing to the Distributor by the
Investment Company and intended for such use or approved in writing by authorized representatives
of the Investment Company or the Investment Company’s investment adviser, and the Investment
Company shall not be responsible in any way for any other information, statements or
representations given or made by the Distributor or any Intermediary. Except as specifically
provided in this Agreement, the Investment Company shall bear none of the expenses of the
Distributor in connection with its offer and sale of the Shares.
7. Subject to the right of the Investment Company to cease to offer Shares as set forth in
paragraph 11 hereof, the Investment Company agrees at its own expense to register, qualify or
determine the exemption for registration or qualification of the Shares then offered with the SEC,
state and other regulatory bodies, and to prepare and file from time to time the Registration
Statement, amendments thereto, reports and other documents as may be necessary to maintain the
registration or qualification. The Distributor and Intermediaries shall provide the Investment
Company promptly with all information required for such registration or qualification. The Fund
shall bear all expenses related to preparing and typesetting such Prospectuses, Statements of
Additional Information, and other materials required by law and such other expenses, including
printing and mailing expenses, related to the Fund’s communications with persons who are
shareholders of the Fund.
8. (a) The Distributor shall act as distributor of Shares in compliance in all material
respects with all applicable laws, rules and regulations, including, without limitation, all rules
and regulations made or adopted pursuant to (i) the 1940 Act, (ii) the 0000 Xxx, (xxx) the
Securities Exchange Act of 1934 (“1934 Act”), (iv) any securities association registered under the
1934 Act, including without limitation the FINRA Conduct Rules or rules of any other applicable
self-regulatory organization. The Distributor shall offer the Shares, and accept purchases,
redemptions and exchanges for Shares, in compliance with the Registration Statement and applicable
law.
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(b) The Distributor shall be responsible for reviewing and making such filings with the FINRA,
as required, of advertisements and sales literature relating to the Fund. The Distributor shall be
responsible for reviewing the Registration Statement for compliance with the
requirement of the FINRA Conduct Rules that the Fund’s prospectus contain disclosure of the
details of any arrangement by which special cash compensation arrangements are made available to a
FINRA member distributing the Fund’s securities, which arrangements are not made available on the
same terms to all FINRA members who distribute the Fund’s securities.
(c) The Distributor shall adopt and follow procedures for the confirmation of sales to
investors and Intermediaries timeliness of orders, the collection of amounts payable by investors
and Intermediaries on such sales, the correction of errors related to distribution of Shares, the
cancellation of unsettled transactions, and assisting with the solicitation of proxies, and any
other matters governed by Rule 38a-1 under the 1940 Act (as may apply to a principal underwriter
for a registered investment company), each as may be necessary to comply with the requirements of
the FINRA, any other self-regulatory organization, and the federal and state securities laws. The
Distributor shall provide reports or other information to the Investment Company at the Investment
Company’s reasonable request, including, without limitation, reports related to the operation and
implementation of the Fund’s policies related to customer privacy, safeguarding of customer
information, sales and marketing practices or other policies and procedures of the Investment
Company.
9. The Distributor agrees that it has adopted and implemented an anti-money-laundering program
in compliance with the USA PATRIOT Act of 2001, the regulations thereunder and FINRA Conduct Rules,
including, without limitation, customer identification program procedures and monitoring for
suspicious activity. The Distributor additionally agrees that it has adopted and implemented
procedures to comply with applicable law and regulation related to cash transaction reporting
requirements, as well as monitoring and reporting under FinCEN, OFAC and other government watch
lists. The Distributor shall provide reports or other information to the Investment Company at the
Investment Company’s reasonable request, related to the operation and implementation of any of the
Fund’s anti-money-laundering policies for which the Distributor is responsible.
10. (a) The Investment Company agrees to indemnify, defend and hold the Distributor, its
officers, directors and employees 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, demands,
liabilities and expenses (including the reasonable cost of investigating or defending such claims,
demands or liabilities and any counsel fees incurred in connection therewith) which the
Distributor, its officers, directors and employees or any such controlling person may incur, under
the 1933 Act or under common law or otherwise, arising out of or based upon any alleged untrue
statement of a material fact contained in the Registration Statement or arising out of or based
upon any alleged omission to state a material fact required to be stated or necessary to make the
Registration Statement not misleading, provided that in no event shall anything contained in this
Agreement be construed so as to protect the Distributor or such other parties against any liability
to the Investment Company or its shareholders to which the Distributor or such other parties would
otherwise be subject by reason of willful misfeasance, bad faith, or gross negligence in the
performance of their duties, or by reason of reckless disregard of their
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obligations and duties
under this Agreement, and further provided that, notwithstanding the foregoing, the Investment
Company shall not indemnify the Distributor or such other parties if such indemnification
obligations arose, directly or indirectly, as a result of conduct as set forth in paragraph 10(b).
The Distributor agrees that it shall look only to the assets of the Fund, and not
to any other series of the Investment Company, for satisfaction of any obligation created by
this paragraph or otherwise arising under this Agreement.
(b) The Distributor agrees to indemnify, defend and hold the Investment Company, its several
officers and Board members, and any person who controls the Investment Company 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 such claims, demands or
liabilities and any counsel fees incurred in connection therewith) which the Investment Company,
its officers or Board members, or any such controlling person may incur, under the 1933 Act or
under common law or otherwise, on account of any act of the Distributor or its directors, officers,
employees or agents, constituting willful misfeasance, bad faith, or gross negligence in the
performance of its duties, or by reason of its reckless disregard of its obligations and duties
under this Agreement or arising out of or based upon any alleged untrue statement of a material
fact contained in information furnished in writing by the Distributor to the Investment Company for
use in the Registration Statement or arising out of or based upon any alleged omission to state a
material fact in connection with such information required to be stated in the Registration
Statement or necessary to make such information not misleading. As used in this paragraph, the term
“employee” shall not include a corporate entity under contract to provide services to the Fund, or
any employee of such a corporate entity, unless such person is otherwise an employee of the
Investment Company.
(c) Each party agrees to promptly notify the other of the commencement of any litigation or
proceedings involving any indemnified party. The indemnification provisions of this paragraph 10
shall survive the termination of this Agreement.
11. The Investment Company reserves the right at any time to withdraw any or all offerings of
the Shares of the Fund, and at its discretion to recommence offering any time thereafter, by
written notice to the Distributor at its principal office.
12. The Distributor may at its sole discretion, directly or through Intermediaries, repurchase
Shares offered for sale by the shareholders or Intermediaries. Repurchase of Shares by the
Distributor shall be at the net asset value (less any applicable sales, redemption or other
charges, as described in the Registration Statement) next determined after a repurchase order has
been received. The Distributor will receive no commission or other remuneration for repurchasing
Shares, other than deferred sales charges as described in the Registration Statement. At the end of
each business day, the Distributor shall notify, by means of electronic transmission (as may be
agreed-upon by the parties to this Agreement) or in writing, the Investment Company and the
Investment Company’s transfer agent, of the orders for repurchase of Shares received by the
Distributor since the last such report, the amount to be paid for such Shares, and the identity of
the shareholders or Intermediaries offering Shares for repurchase. Upon such notice, the Investment
Company shall pay the Distributor such amounts as are required by the Distributor to pay for the
repurchase of such Shares in cash or in the form of a credit against moneys due the Investment
Company from the Distributor as proceeds from the sale of Shares. The Investment
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Company reserves
the right to suspend such repurchase right upon written notice to the Distributor. The Distributor
further agrees to act as agent for the Investment Company to receive and transmit promptly to the
Investment Company’s transfer agent shareholder and Intermediary requests for redemption of Shares.
13. The Distributor is an independent contractor and shall be agent for the Investment Company
only in respect to the sale, redemption and exchange of the Shares, including for the limited
purpose of determining the time as of which Share transactions are deemed to have been received.
14. The services of the Distributor to the Investment Company under this Agreement are not to
be deemed exclusive, and the Distributor shall be free to render similar services or other services
to others so long as its services hereunder are not impaired thereby.
15. The Distributor shall prepare reports for the Board on a quarterly basis, or more
frequently as reasonably requested by the Board, showing such information concerning expenditures
related to this Agreement or related to the operation and implementation of the Fund’s Plan.
16. As used in this Agreement, the terms “assignment,” “interested person” and “majority of
the outstanding voting securities” shall have the meanings given to them by Section 2(a) of the
1940 Act, subject to such exemptions as may be granted by the SEC or its staff, as appropriate, by
any rule, regulation, order, or no-action or interpretative letter.
17. This Agreement will become effective with respect to the Fund on the date written beside
the name of the Fund on Appendix A hereto and, unless sooner terminated as provided herein, will
continue in effect with respect to the Fund for two years from such date. Thereafter, if not
terminated, this Agreement shall continue in effect with respect to the Fund for successive annual
periods ending on the same date of each year, provided that such continuance is specifically
approved at least annually (i) by the Board or (ii) by a vote of a majority of the outstanding
voting securities (as defined the in 0000 Xxx) of the Fund, provided that in either event the
continuance is also approved by a majority of the Investment Company’s Independent Board Members,
by vote cast in person at a meeting called for the purpose of voting on such approval.
18. This Agreement is terminable with respect to the Fund without penalty by the Board, by
vote of a majority of the outstanding voting securities of the Fund (as defined in the 1940 Act),
or by the Distributor, on not less than 60 days’ written notice to the other party, and such notice
period may be waived upon the mutual written consent of the Distributor and the Investment Company.
This Agreement will also automatically and immediately terminate in the event of its assignment (as
defined in Section 16 of this Agreement).
19. Shares of the Fund may have been divided into separate classes and may have sales charges
or discounts or waivers available for certain categories of investor, as described in the
Registration Statement, if applicable.
20. The Fund and the Distributor agree that the information exchanged hereunder and
information about the respective customers and potential customers of each is confidential and as
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such shall not be disclosed, sold or used in any way except to carry out the terms of this
Agreement. Notwithstanding the foregoing, such confidential information may be disclosed on a “need
to know” basis as set forth in applicable privacy rules and regulations. The obligations regarding
confidentiality hereunder shall not apply to any information which is (i) otherwise publicly
available, (ii) already possessed by the entity to whom the information was disclosed prior to
disclosure hereunder, (iii) independently developed by the entity, or (iv) disclosed
pursuant to law, rule, regulation or court or administrative order. The Distributor shall have
the right to use any list of shareholders of the Fund or any other list of investors which it
obtains in connection with its provision of services under this Agreement, provided that such use
is consistent with applicable law and the privacy policies of the Distributor and the Fund. The
Distributor further agrees to take commercially reasonable steps, in accordance with applicable
law, to safeguard customer information. The provisions of this paragraph 20 will survive
termination of this Agreement.
21. From time to time, the Fund may implement policies, procedures or charges in an effort to
avoid the potential adverse effects on the Fund of short-term trading by market timers. The
Distributor agrees to cooperate in good faith with the Investment Company in the implementation of
(i) any such policies, procedures and/or charges, and (ii) the imposition and payment over to the
Fund of redemption fees specified in the Registration Statement. The Distributor agrees, where
appropriate, to make reasonable efforts to obtain the agreement of Intermediaries to comply with
the Fund’s frequent trading and other policies set forth in the Registration Statement or to take
alternative actions reasonably designed to achieve compliance with these policies.
22. No provision of this Agreement may be changed, waived, discharged or terminated, except by
an instrument in writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. This Agreement may be executed in multiple counterparts.
23. This Agreement shall be governed by, and construed in accordance with, the laws of the
State of Maryland.
24. Notices shall be provided to each party, as noted below:
To the Distributor:
Attn: Xxxxxx Xxxxx
Xxxx Xxxxx Investor Services, LLC
c/x Xxxx Xxxxx, Inc.,
000 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Xxxx Xxxxx Investor Services, LLC
c/x Xxxx Xxxxx, Inc.,
000 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
To the Investment Company:
Xxxx Xxxxx Partners Variable Income Trust
000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx, Secretary and Chief Legal Officer
000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx, Secretary and Chief Legal Officer
[signature page to follow]
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IN WITNESS WHEREOF, the parties hereto caused this Agreement to be executed by their officers
thereunto duly authorized.
ATTEST:
|
XXXX XXXXX PARTNERS VARIABLE INCOME TRUST |
|
By: /s/ Xxxxxx X. Xxxxx
|
By: /s/ R. Xxx Xxxxxx | |
Name: Xxxxxx X. Xxxxx
|
Name: R. Xxx Xxxxxx | |
Title: Senior Vice President
|
Title: Chairman, CEO and President | |
ATTEST:
|
XXXX XXXXX INVESTOR SERVICES, LLC | |
By: /s/ Xxxx X. Xxxxxxxx
|
By: /s/ Xxxx Xxxxxx | |
Name: Xxxx X. Xxxxxxxx
|
Name: Xxxx Xxxxxx | |
Title: Managing Director
|
Title: Managing Director |
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Appendix A
| Name of Fund | Date Added | |
Xxxx Xxxxx Partners Variable Adjustable Rate Income Portfolio
|
December 1, 2008 | |
Xxxx Xxxxx Partners Variable Diversified Strategic Income Portfolio
|
December 1, 2008 | |
Xxxx Xxxxx Partners Variable Global High Yield Bond Portfolio
|
December 1, 2008 | |
Xxxx Xxxxx Partners Variable High Income Portfolio
|
December 1, 2008 | |
Xxxx Xxxxx Partners Variable Money Market Portfolio
|
December 1, 2008 | |
Xxxx Xxxxx Partners Variable Strategic Bond Portfolio
|
December 1, 2008 |
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