Exhibit 5
DISTRIBUTION AGREEMENT
BETWEEN
ALLMERICA PRIME TRUST
AND
ALLMERICA INVESTMENTS, INC.
THIS DISTRIBUTION AGREEMENT, made as of the ___th day of November, 2002, by and
between Allmerica Prime Trust, a business trust organized and existing under the
laws of the Commonwealth of Massachusetts (hereinafter called the "Trust") and
Allmerica Investments, Inc., a corporation organized and existing under the laws
of the Commonwealth of Massachusetts (hereinafter called the "Distributor").
WITNESSETH:
WHEREAS, the Trust engages in business as an open-end management investment
company and is registered as such under the federal Investment Company Act of
1940, as amended ("ICA-40"); and
WHEREAS, the Trust is authorized to issue shares of beneficial interest
("Shares") in separate series, with each such series representing the interests
in a separate portfolio of securities and other assets; and
WHEREAS, the Trust currently offers Shares in the Allmerica Prime Trust
("Fund"), such series together with any other series which may be established
later and served by the Distributor hereunder, being herein referred to
collectively as the "Funds" and individually referred to as a "Fund"; and
WHEREAS, the Distributor is engaged in the business of distributing securities,
including shares of investment companies, and is registered as a broker-dealer
under the Securities Exchange Act of 1934, as amended, ("SEA-34") and is a
member of the National Association of Securities Dealers, Inc. ("NASD"); and
WHEREAS, the Trust desires the Distributor to act as the distributor in the
public offering of the Shares of the Funds; and
NOW, THEREFORE, in consideration of the premises and the mutual promises
hereinafter set forth, the parties hereto agree as follows:
1. Delivery of Trust Documents. The Trust has furnished Distributor with
copies, properly certified or authenticated, of each of the following:
(a) Agreement and Declaration of Trust as in effect on the date hereof
("Declaration of Trust").
(b) By-Laws of the Trust as in effect on the date hereof.
(c) Resolutions of the Board of Trustees of the Trust selecting
Distributor as principal underwriter for the Funds and approving
this form of agreement.
The Trust shall furnish the Distributor from time to time with copies,
properly certified or authenticated, of all the amendments of, or
supplements to, the foregoing, if any.
The Trust shall furnish Distributor promptly with properly certified or
authenticated copies of any registration statements filed by it on behalf
of the Funds with the Securities and Exchange Commission under the
Securities Act of 1933, as amended ("SA-33") or ICA-40, together with any
financial statements and exhibits included therein, and all amendments or
supplements thereto hereafter filed.
2. Sale of Shares. Subject to the provisions of Paragraphs 3, 4, and 6
hereof, and to such minimum purchase requirements as may from time to
time be currently indicated in the Trust's prospectus, on behalf of the
Funds, the Distributor is authorized to sell, as agent for the Trust, on
behalf of the Funds, Shares authorized for issuance and registered under
SA-33. Distributor may also purchase as principal such Shares for resale
to the public. Such sale will be made by Distributor on behalf of the
Funds by accepting unconditional orders to purchase the Shares placed
with Distributor by investors and such purchases will be made by
Distributor only after acceptance by Distributor of such orders. The
sales price to the public of such Shares shall be the public offering
price as defined in Paragraph 5 hereof.
3. Sale of Shares by the Trust. The rights granted to the Distributor shall
be nonexclusive in that the Trust, on behalf of the Funds, reserves the
right to sell Shares of the Funds to investors pursuant to applications
received and accepted by the Trust or its transfer agent, if any.
Further, the Trust reserves the right to issue Shares in connection with
the merger or consolidation of any other investment company, trust or
personal holding company with the Trust or the Trust's acquisition by the
purchase or otherwise, of all or substantially all of the assets of an
investment company, trust or personal holding company. Any right granted
to Distributor to accept orders for Shares, or to make sales on behalf of
the Funds or to purchase Shares for resale, will not apply to Shares
issued in connection with the merger or consolidation of any other
investment company with the Trust or its acquisition by purchase or
otherwise, of all or substantially all of the assets of any investment
company, trust or personal holding company, or substantially all of the
outstanding shares or interests of any such entity, and such right shall
not apply to Shares that may be offered by the Trust to shareholders by
virtue of their being shareholders of the Funds.
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4. Shares Covered by this Agreement. This Agreement relates to the issuance
and sale of Shares that are duly authorized, registered, and available
for sale by the Trust, on behalf of the Funds, including redeemed or
repurchased Shares if and to the extent that they may be legally sold and
if, but only if, the Trust authorizes the Distributor to sell them.
5. Public Offering Price. All Shares sold by the Distributor pursuant to
this Agreement shall be sold at the public offering price. The public
offering price for all accepted subscriptions will be the net asset value
per share, as determined in the manner provided in the Trust's
Declaration of Trust, with respect to the Funds, as now in effect, or as
it may be amended (and as reflected in the then current prospectus of the
Trust, with respect to the Funds), next determined after the order is
accepted by the Distributor. The Distributor will process orders
submitted by brokers for the sale of Shares at the public offering price
exclusive of any commission charged by such broker to his customer.
6. Suspension of Sales. If and whenever the determination of net asset
value is suspended and until such suspension is terminated, no further
orders for Shares shall be accepted by the Distributor except such
unconditional orders placed with the Distributor before it had knowledge
of the suspension. In addition, the Trust reserves the right to suspend
sales and Distributor's authority to accept orders for Shares on behalf
of a Fund if, in the judgment of the Board of Trustees of the Trust, it
is in the best interests of the Trust or Fund to do so, such suspension
to continue for such period as may be determined by the Board of
Trustees; and in that event, no orders to purchase Shares shall be
processed or accepted by the Distributor on behalf of the Funds while
such suspension remains in effect except for Shares necessary to cover
unconditional orders accepted by Distributor before it had knowledge of
the suspension, unless otherwise directed by the Board of Trustees.
7. Solicitation of Orders. In consideration of the rights granted to the
Distributor under this Agreement, Distributor will use its best efforts
(but only in states in which Distributor may lawfully do so) to obtain
from investors unconditional orders for Shares authorized for issuance by
the Trust, on behalf of the Funds, and registered under SA-33, provided
that Distributor may in its discretion reject any order to purchase
Shares. This does not obligate the Distributor to register or maintain
its registration as a broker or dealer under the state securities laws of
any jurisdiction if, in the discretion of the Distributor, such
registration is not practical or feasible. The Funds shall make available
to the Distributor at the expense of the Distributor such number of
copies of the Funds' currently effective prospectus as the Distributor
may reasonably request. The Funds 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.
8. Authorized Representations. The Trust is not authorized by the
Distributor to give, on behalf of the Distributor, any information or to
make any representations other than the information and representations
contained in a registration statement or prospectus filed with the SEC
under SA-33 and/or ICA-40, covering Shares, as such registration
statement and prospectus may be amended or supplemented from time to
time.
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Distributor is not authorized by the Trust to give on behalf of the Funds
any information or to make any representations in connection with the
sale of Shares other than the information and representations contained
in a registration statement or prospectus filed with the Securities and
Exchange Commission ("SEC") under SA-33 and/or ICA-40, covering Shares,
as such registration statement and prospectus may be amended or
supplemented from time to time, or contained in shareholder reports or
other material that may be prepared by or on behalf of the Fund for the
Distributor's use. This shall not be construed to prevent the Distributor
from preparing and distributing tombstone ads and sales literature or
other material as it may deem appropriate. No person other than
Distributor is authorized to act as principal underwriter (as such term
is defined in ICA-40, as amended) for the Trust.
9. Registration and Sale of Additional Shares. The Trust, on behalf of the
Funds will, from time to time, use its best efforts to register under
SA-33, such Shares of the Funds as Distributor may reasonably be expected
to sell on behalf of the Funds. In connection therewith, the Trust, on
behalf of the Funds, hereby agrees to register an indefinite number of
Shares under SA-33 and ICA-40. The Trust, on behalf of the Funds will, in
cooperation with the Distributor, take such action as may be necessary
from time to time to qualify such Shares in any state mutually agreeable
to the Distributor and the Funds, and to maintain such qualification.
10. Expenses. The Distributor shall pay, or will enter arrangements
providing that persons other than Distributor shall pay, all fees and
expenses:
a. incurred in connection with its registration as a broker or dealer or
the registration or qualification of its officers, directors or
representations under federal and state laws; and
b. incurred in connection with the sale and offering for sale of Shares
which may have been specifically allocated to the Distributor.
Other than the expenses specifically assumed by the Distributor or
the investment manager of the Trust, under the Management Agreement
between the investment manager and the Trust, all expenses incurred
in the operation of the Trust are borne by the Trust.
11. Conformity with Law. Distributor agrees that in selling Shares it shall
duly conform in all respects with the laws of the United States and any
state in which such Shares may be offered for sale by Distributor
pursuant to this Agreement and to the rules and regulations of the NASD.
12. Independent Contractor. Distributor shall be an independent contractor
and neither Distributor, nor any of its officers, directors, employees,
or representatives is or shall be an employee of the Trust in the
performance of Distributor's duties hereunder. Distributor
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shall be responsible for its own conduct and the employment, control and
conduct of its agents and employees and for injury to such agents or
employees or to others through its agents or employees. Distributor
assumes full responsibility for its agents and employees under applicable
statutes and agrees to pay all employee taxes thereunder.
13. Indemnification. Distributor agrees to indemnify and hold harmless the
Trust or Funds, as appropriate, and each of the Trust's Trustees,
officers, employees, representatives and each person, if any, who
controls the Trust or Funds within the meaning of Section 15 of SA-33
against any and all losses, liabilities, damages, claims or expenses
(including the reasonable costs of investigating or defending any alleged
loss, liability, damage, claim or expense and reasonable legal counsel
fees incurred in connection therewith) to which the Trust or Funds or
such of the Trust's Trustees, officers, employees, representatives or
controlling person may become subject under SA-33, under any other
statute, at common law, or otherwise, arising out of the acquisition of
any Shares by any person which (i) may be based upon any wrongful act by
Distributor or any of Distributor's directors, officers, employees or
representatives, or (ii) may be based upon any untrue statement or
alleged untrue statement of a material fact contained in a registration
statement, prospectus, shareholder report or other information covering
Shares filed or made public by the Trust, on behalf of the Funds, or any
amendment thereof or supplement thereto, or the omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading unless such
statement or omission was made in reliance upon information furnished to
the Distributor by the Trust. In no case (i) is Distributor's indemnity
in favor of the Trust or Funds, as appropriate, or any person indemnified
to be deemed to protect the Trust or Funds, as appropriate, or such
indemnified person against any liability to which the Trust or Funds, as
appropriate, or such person would otherwise be subject by reason of
willful misfeasance, bad faith, or gross negligence in the performance of
his duties or by reason of his reckless disregard of his obligations and
duties under this Agreement or (ii) is Distributor to be liable under its
indemnity agreement contained in this Paragraph with respect to any claim
made against the Trust or Funds, as appropriate, or any person
indemnified unless the Trust or Funds, as appropriate, or such person, as
the case may be, shall have notified Distributor in writing of the claim
within a reasonable time after the summons or other first written
notification giving information of the nature of the claim shall have
been served upon the Trust or Funds, as appropriate, or upon such person
(or after the Trust or Fund or such person shall have received notice of
such service on any designated agent). However, failure to notify
Distributor of any such claim shall not relieve Distributor from any
liability which Distributor may have to the Trust or Fund or any person
against whom such action is brought otherwise than on account of
Distributor's indemnity agreement contained in this Paragraph.
Distributor shall be entitled to participate, at its own expense, in the
defense, or, if Distributor so elects, to assume the defense of any suit
brought to enforce any such claim, but, if Distributor elects to assume
the defense, such defense shall be conducted by legal counsel chosen by
Distributor and satisfactory to the Trust, on behalf of the Funds, to its
Trustees, officers, employees or representatives, or to any controlling
person or persons, defendant or defendants, in the suit. In the event
that Distributor elects to assume the
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defense of any such suit and retain such legal counsel, the Trust, its
Trustees, officers, employees, representatives or controlling person or
persons, defendant or defendants in the suit, shall bear the fees and
expenses of any additional legal counsel retained by them. If Distributor
does not elect to assume the defense of any such suit, Distributor will
reimburse the Trust, on behalf of the Funds, such Trustees, officers,
employees, representatives or controlling person or persons, defendant or
defendants in such suit for the reasonable fees and expenses of any legal
counsel retained by them. Distributor agrees to promptly notify the Trust
of the commencement of any litigation or proceedings against it or any of
its directors, officers, employees or representatives in connection with
the issue or sale of any Shares.
The Trust, on behalf of the Funds, agrees to indemnify and hold harmless
Distributor and each of its directors, officers, employees,
representatives and each person, if any, who controls Distributor within
the meaning of Section 15 of SA-33 against any and all losses,
liabilities, damages, claims or expenses (including the reasonable costs
of investigating or defending any alleged loss, liability, damage, claim
or expense and reasonable legal counsel fees incurred in connection
therewith) to which Distributor or such of its directors, officers,
employees, representatives or controlling person may become subject under
SA-33, under any other statute, at common law, or otherwise, arising out
of the acquisition of any Shares by any person which (i) may be based
upon any wrongful act by the Trust or any of the Trust's Trustees,
officers, employees or representatives, or (ii) may be based upon any
untrue statement or alleged untrue statement of a material fact contained
in a registration statement, prospectus, shareholder report or other
information covering Shares filed or made public by the Trust, on behalf
of the Funds, or any amendment thereof or supplement thereto, or the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading unless such statement or omission was made in reliance upon
information furnished to the Trust by the Distributor. In no case (i) is
the Trust's indemnity in favor of the Distributor, or any person
indemnified to be deemed to protect the Distributor or such indemnified
person against any liability to which the Distributor or such person
would otherwise be subject by reason of willful misfeasance, bad faith,
or gross negligence in the performance of his duties or by reason of his
reckless disregard of his obligations and duties under this Agreement, or
(ii) is the Trust, on behalf of the Funds, to be liable under its
indemnity agreement contained in this Paragraph with respect to any claim
made against Distributor, or person indemnified unless Distributor, or
such person, as the case may be, shall have notified the Trust in writing
of the claim within a reasonable time after the summons or other first
written notification giving information of the nature of the claim shall
have been served upon Distributor or upon such person (or after
Distributor or such person shall have received notice of such service on
any designated agent). However, failure to notify the Trust of any such
claim shall not relieve the Trust from any liability which the Trust may
have to Distributor or any person against whom such action is brought
otherwise than on account of the Trust's indemnity agreement contained in
this Paragraph.
The Trust, on behalf of the Funds, shall be entitled to participate, at
its own expense, in the defense, or, if the Trust, on behalf of the
Funds, so elects, to assume the defense of any suit
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brought to enforce any such claim, but, if the Trust, on behalf of the
Funds, elects to assume the defense, such defense shall be conducted by
legal counsel chosen by the Trust, on behalf of the Funds, and
satisfactory to Distributor, to its directors, officers, employees or
representatives, or to any controlling person or persons, defendant or
defendants, in the suit. In the event that the Trust, on behalf of the
Funds, elects to assume the defense of any such suit and retain such
legal counsel, Distributor, its directors, officers, employees,
representatives or controlling person or persons, defendant or defendants
in the suit, shall bear the fees and expenses of any additional legal
counsel retained by them. If the Trust, on behalf of the Funds, does not
elect to assume the defense of any such suit, the Trust, on behalf of the
Funds, will reimburse Distributor, such directors, officers, employees,
representatives or controlling person or persons, defendant or defendants
in such suit for the reasonable fees and expenses of any legal counsel
retained by them. The Trust, on behalf of the Funds, agrees to promptly
notify Distributor of the commencement of any litigation or proceedings
against it or any of its Trustees, officers, employees, or
representatives in connection with the issue or sale of any Shares.
14. Limitation on Liability. A copy of Trust's Declaration of Trust is on
file with the Secretary of State of the Commonwealth of Massachusetts,
and notice is hereby given that this instrument is executed by the
Trustees as Trustees or any officer or officers as officers and not
individually, and that the obligations of this instrument are not binding
upon any of the Trustees, officers or shareholders individually but are
binding only upon the assets and property of the Trust.
15. Duration and Termination of this Agreement. This Agreement shall become
effective upon its execution ("effective date") and, unless terminated as
provided, shall remain in effect through ________________ and from year
to year thereafter, but only so long as such continuance is specifically
approved at least annually by the vote of a majority of the Trustees of
the Trust who are not interested persons of Distributor or of the Trust,
cast in person at a meeting called for the purpose of voting on such
approval, and by vote of the Trustees of the Trust or of a majority of
the outstanding voting securities of the Trust. This Agreement may, on 60
days' written notice, be terminated at any time, without the payment of
any penalty, by the vote of a majority of the Trustees of the Trust who
are not interested persons of Distributor or the Trust, by a vote of a
majority of the outstanding voting securities of the Trust, or by
Distributor. This Agreement will automatically terminate in the event of
its assignment. In interpreting the provisions of this Paragraph 15, the
definitions contained in Section 2(a) of ICA-40 (particularly the
definitions of "interested person," "assignment," and "majority of the
outstanding securities") shall be applied.
16. Amendment of this Agreement. No provisions of this Agreement may be
changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against which enforcement of
the change, waiver, discharge or termination is sought. If the Trust
should at any time deem it necessary or advisable in the best interests
of the Trust that any amendment of this Agreement be made in order to
comply with the recommendations or requirements of the SEC or other
governmental authority or to obtain any advantage under state or federal
tax laws and notifies Distributor of the form of such amendment, and
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the reasons therefor, and if Distributor should decline to assent to such
amendment, the Trust may terminate this Agreement forthwith. If
Distributor should at any time request that a change be made in the
Trust's Declaration of Trust or By-Laws or in its methods of doing
business, in order to comply with any requirements of federal law or
regulations of the SEC, or of a national securities association of which
Distributor is or may be a member relating to the sale of Shares, and the
Trust, on behalf of the Funds, should not make such necessary change
within a reasonable time, Distributor may terminate this Agreement
forthwith.
17. Additional Funds. In the event that the Trust establishes one or more
series of Shares in addition to the Funds with respect to which it
desires to have Distributor render services as distributor under the
terms hereof, it shall so notify Distributor in writing, and if
Distributor agrees in writing to provide such services, such series of
Shares shall become a Fund hereunder.
18. Miscellaneous. The captions in this Agreement are included to convenience
of reference only, and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect. This Agreement
may be executed simultaneously in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute
one and the same instrument.
19. Notice. Any notice required or permitted to be given by either party to
the other shall be deemed sufficient if hand-delivered, or if sent by
registered or certified mail, postage prepaid, addressed by the party
giving notice to the other party at the last address furnished by the
other party to the party giving notice: if to the Trust, 000 Xxxxxxx
Xxxxxx, Xxxxxxxxx, XX 00000 and if to the Distributor, 000 Xxxxxxx
Xxxxxx, Xxxxxxxxx, XX 00000.
ALLMERICA PRIME TRUST
By: ____________________________________________
Name: ____________________________________________
Title: ____________________________________________
ALLMERICA INVESTMENTS, INC.
By: ____________________________________________
Name: ____________________________________________
Title: ____________________________________________
Date: November ___, 2002
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