Exhibit e(1)
AMENDED AND RESTATED
DISTRIBUTION AGREEMENT
DISTRIBUTION AGREEMENT, dated as of September 26, 1985, amended and
restated as of January 16, 1992, and further amended and restated as of May 5,
2000 by and between CITIFUNDS MULTI-STATE TAX FREE TRUST (formerly, Landmark New
York Tax Free Reserves) a Massachusetts business trust (the "Trust"), and CFBDS,
Inc., a Massachusetts corporation ("CFBDS" or the "Distributor"). This Agreement
relates solely to shares of Beneficial Interest of the Trust that are designated
"Class N" ("Shares").
W I T N E S S E T H:
WHEREAS, the Trust is engaged in business as an open-end investment
company registered under the Investment Company Act of 1940 (collectively with
the rules and regulations promulgated thereunder, the "1940 Act");
WHEREAS, the shares of Beneficial Interest (without par value) of the
Trust (the "Shares") are divided into one or more separate series (together with
any series which may in the future be established, the "Funds");
WHEREAS, the Board of Trustees of the Trust has adopted a Distribution
Plan, dated as of September 26, 1985, as amended and restated (the "Distribution
Plan"), which is incorporated herein by reference and pursuant to which the
Trust desires to enter into this Distribution Agreement; and
WHEREAS, the Trust wishes to engage CFBDS to provide certain services with
respect to the distribution of Shares of each Fund, and CFBDS is willing to
provide such services to the Trust on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. The Trust grants to the Distributor the right, as agent of the Trust,
to sell Shares of each Fund upon the terms hereinbelow set forth during the term
of this Agreement. While this Agreement is in force, the Distributor agrees to
use its best efforts to find purchasers for Shares of each Fund.
The Distributor shall have the right, as agent of the Trust, to order from
the Trust the Shares needed, but not more than the Shares needed (except for
clerical errors and errors of transmission), to fill unconditional orders for
Shares of each Fund placed with the Distributor by any dealer, all such orders
to be made in the manner set Forth in the Trust's then-current prospectus (the
"Prospectus") and then-current statement of additional information (the
"Statement of Additional Information") relating to such Shares. The price which
shall be paid to the Trust for the Shares of each Fund so purchased shall be the
net asset value per Share as determined in accordance with the provisions of the
Trust's Declaration of Trust and By-Laws, as each may from time to time be
amended (collectively, the "Governing Instruments"). The Distributor shall
notify the Custodian of the Trust (currently State Street Bank and Trust
Company), at the end of each business day, or as soon thereafter as the orders
placed with the Distributor have been compiled, of the number of Shares of each
Fund and the prices thereof which have been ordered through the Distributor
since 12:00 noon on the previous business day.
The right granted to the Distributor to place orders for Shares with the
Trust shall be exclusive, except that this exclusive right shall not apply to
Shares issued in the event that an investment company (whether a regulated or
private investment company or a personal holding company) is merged with and
into or consolidated with the Trust or any Fund or in the event that the Trust
or any Fund acquires, by purchase or otherwise, all (or substantially all) the
assets or the outstanding shares of any such company; nor shall it apply to
Shares issued by the Trust as a dividend or stock split. The exclusive right to
place orders for Shares granted to the Distributor may be waived by the
Distributor by notice to the Trust in writing, either unconditionally or subject
to such conditions and limitations as may be set forth in such notice to the
Trust. The Trust hereby acknowledges that the Distributor may render
distribution and other services to other parties, including other investment
companies. In connection with its duties hereunder, the Distributor shall also
arrange for computation of performance statistics with respect to each Fund and
arrange for publication of current price information in newspapers and other
publications.
2. The Shares may be sold by the Distributor on behalf of the Trust to or
through any dealer having a sales agreement with the Distributor upon the
following terms and conditions: The public offering price of Shares of each
Fund, i.e., the price per Share at which the Distributor or dealer purchasing
Shares through the Distributor may sell shares to the public, shall be the net
asset value of such Shares.
The net asset value of Shares of each Fund shall be determined by the
Trust, or by an agent of the Trust, as of 12:00 noon, New York City time, on
each day on which the New York Stock Exchange is open for trading (and on such
other days as the Trustees deem necessary in order to comply with Rule 22c-1
under the 1940 Act), in accordance with the method established pursuant to the
Governing Instruments. The Trust shall have the right to suspend the sale of
Shares of any Fund if, because of some extraordinary condition, the New York
Stock Exchange shall be closed, or if conditions existing during the hours when
the Exchange is open render such action advisable or for any other reason deemed
adequate by the Trust.
3. The Trust agrees that it will, from time to time, but subject to the
necessary approval, if any, of its shareholders, take all necessary action to
register such number of Shares under the Securities Act of 1933, as amended (the
"1933 Act"), as the Distributor may reasonably be expected to sell.
The Distributor shall be an independent contractor and neither the
Distributor nor any of its Directors, officers or employees as such, is or shall
be an employee of the Trust. It is understood that Trustees, officers and
shareholders of the Trust are or may become interested in the Distributor, as
Directors, officers, employees, or otherwise and that Directors, officers and
employees of the Distributor are or may become similarly interested in the Trust
and that the Distributor may be or become interested in the Trust as a
shareholder or otherwise. The Distributor is responsible for its own conduct and
the employment, control and conduct (but only with respect to the duties and
obligations of the Distributor hereunder) of its agents and employees and for
any injury to any of such agents or employees or to others through its agents or
employees. The Distributor assumes full responsibility for its agents and
employees under applicable statutes and agrees to pay all employer taxes
thereunder.
4. The Distributor covenants and agrees that, in selling Shares, it will
use its best efforts in all respects duly to conform with the requirements of
all state and federal laws and the Conduct Rules of the National Association of
Securities Dealers, Inc. relating to the sale of Shares, and will indemnify and
hold harmless the Trust and each of its Trustees and officers and each person,
if any, who controls the Trust within the meaning of Section 15 of the Act (the
"Indemnified Parties") against all losses, liabilities, damages or expenses
(including the reasonable cost of investigating or defending any alleged loss,
liability, damages, claim or expense and reasonable counsel fees incurred in
connection therewith) arising from any claim, demand, action or suit
(collectively, "Claims"), arising by reason of any person's acquiring any of the
Shares through the Distributor, which may be based upon the 1933 Act or any
other statute or common law, on account of any wrongful act of the Distributor
or any of its employees (including any failure to conform with any requirement
of any state or federal law or the Conduct Rules of the National Association of
Securities Dealers, Inc. relating to the sale of Shares) or on the ground that
the registration statement under the 1933 Act, including all amendments thereto
(the "Registration Statement"), or Prospectus or previous prospectus or
Statement of Additional Information or previous statement of additional
information, with respect to such Shares, includes or included an untrue
statement of a material fact or omits or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading, if and only if any such act, statement or omission was
made in reliance upon information furnished by the Distributor to the Trust;
provided, however, that in no case (i) is the indemnity of the Distributor in
favor of any Indemnified Party to be deemed to protect any such Indemnified
Party against liability to which such Indemnified Party would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of its or his duties or by reason of its or his reckless disregard
of its or his obligations and duties under this Agreement, or (ii) is the
Distributor to be liable under its indemnity agreement contained in this Section
4 with respect to any Claim made against any Indemnified Party unless such
Indemnified Party shall have notified the Distributor in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the Claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify the Distributor of
any such Claim shall not relieve it from any liability which it may have to any
Indemnified Party otherwise than on account of its indemnity agreement contained
in this Section 4. The Distributor shall be entitled to participate, at its own
expense, in the defense, or, if it so elects, to assume the defense, of any suit
brought to enforce any such Claim, and, if the Distributor elects to assume the
defense, such defense shall be conducted by counsel chosen by it and
satisfactory to each Indemnified Party. In the event that the Distributor elects
to assume the defense of any such suit and retain such counsel, each Indemnified
Party shall bear the fees and expenses of any additional counsel retained by it
but, in case the Distributor does not elect to assume the defense of any such
suit, it shall reimburse the Indemnified Parties for the reasonable fees and
expenses of any counsel retained by them. Except with the prior written consent
of the Distributor, no Indemnified Party shall confess any Claim or make any
compromise in any case in which the Distributor will be asked to indemnify such
Indemnified Party. The Distributor agrees promptly to notify the Trust of the
commencement of any litigation or proceeding against it in connection with the
issuance and sale of any of the Shares.
Neither the Distributor nor any dealer nor any other person is authorized
to give any information or to make any representation on behalf of the Trust, in
connection with the sale of Shares of any Fund, other than those contained in
the Registration Statement or Prospectus or Statement of Additional Information
relating to such Fund.
5. The Trust will pay, or cause to be paid--
(i) all costs and expenses of the Trust, including fees and
disbursements of its counsel, in connection with the preparation and
filing of the Registration Statement, Prospectus and Statement of
Additional Information with respect to Shares of each Fund, and
preparing and mailing to shareholders Prospectuses, Statements of
Additional Information, statements and confirmations and periodic
reports (including the expense of setting in type the Registration
Statement, Prospectus and Statement of Additional Information or any
periodic report with respect to Shares of each Fund);
(ii) the cost of preparing temporary or permanent certificates
for Shares;
(iii) the cost and expenses of delivering to the Distributor
at its office in Boston, Massachusetts all Shares purchased through
it as agent hereunder;
(iv) a distribution fee from the assets of each Fund to the
Distributor at an annual rate not to exceed 0.10% of the Trust's
average daily net assets pertaining to such Fund for its
then-current fiscal year, plus an additional fee from the assets of
each Fund at an annual rate not to exceed 0.10% of the Trust's
average daily net assets pertaining to such Fund for its
then-current fiscal year in anticipation of, or as reimbursement
for, expenses incurred by the Distributor in connection with print
or electronic media advertising in connection with the sale of
Shares of such Fund, subject to the Distribution Plan;
(v) all fees and disbursements of the Transfer Agent and
Custodian with respect to each Fund, subject to the Trust's
Administrative Services Plan;
(vi) a fee to each Shareholder Servicing Agent (pursuant to a
shareholder servicing agreement with each such Agent), subject to
the Trust's Administrative Services Plan;
(vii) a fee to the Administrator of the Trust (pursuant to the
Administrative Services Agreement), subject to the Trust's
Administrative Services Plan; and
(viii) a fee to the investment adviser of each Fund (pursuant
to the Investment Advisory Agreement with such adviser).
The Distributor agrees that, with respect to the sale of Shares of each
Fund, after the Prospectus and Statement of Additional Information and periodic
reports with respect to such Fund have been set in type, it will bear the
expense (other than the cost of mailing to shareholders of the Trust) of
printing and distributing any copies thereof which are to be used in connection
with the offering or sale of Shares of such Fund to any dealer or prospective
investor. The Distributor further agrees that it will bear the expenses of
preparing, printing and distributing any other literature used by the
Distributor or furnished by it for use by any dealer in connection with the
offering of the Shares of such Fund for sale to the public and any expense of
sending confirmations and statements to any dealer having a sales agreement with
the Distributor. The Distributor will also bear the cost of any compensation
paid to dealers in connection with the sale of Shares of such Fund. The
Distributor also agrees to bear the expenses of qualification of Shares of such
Fund for sale in the various states and, if necessary or advisable in connection
therewith, of qualifying the Trust as a broker or dealer in any such state.
6. If, at any time during the term of this Agreement, the Trust shall 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 any recommendation or
requirement of the Securities and Exchange Commission or other governmental
authority or to obtain any advantage under Massachusetts or federal tax laws, it
shall notify the Distributor of the form of amendment which it deems necessary
or advisable and the reasons therefor. If the Distributor declines to assent to
such amendment (after a reasonable time), the Trust may terminate this Agreement
forthwith by written notice to the Distributor without payment of any penalty.
If, at any time during the term of this Agreement, the Distributor requests the
Trust to make any change in its Governing Instruments or in its methods of doing
business which are necessary in order to comply with any requirement of federal
law or regulations of the Securities and Exchange Commission or of a national
securities association of which the Distributor is or may become a member,
relating to the sale of Shares, and the Trust fails (after a reasonable time) to
make any such change as requested, the Distributor may terminate this Agreement
forthwith by written notice to the Trust without payment of any penalty.
7. The Distributor agrees that it will not take any long or short position
in the Shares of any Fund and that, so far as it can control the situation, it
will prevent any of its Directors or officers from taking any long or short
position in the Shares of such Fund, except as permitted by the Governing
Instruments.
8. This Agreement shall become effective upon its execution and shall
continue in force indefinitely, provided that such continuance is specifically
approved at least annually (i) by the vote of a majority of the Trustees of the
Trust who are not "interested persons" of the Trust or of the Distributor at a
meeting specifically called for the purpose of voting on such approval, and (ii)
by the Board of Trustees of the Trust, or by the "vote of a majority of the
outstanding voting securities" of each Fund. The aforesaid requirement that
continuance of this Agreement be "specifically approved at least annually" shall
be construed in a manner consistent with the 1940 Act. This Agreement may be
terminated as to any Fund at any time by either party without payment of any
penalty on not more than 60 days' nor less than 30 days' written notice to the
other party.
This Agreement shall automatically terminate in the event of its
assignment.
9. CFBDS may subcontract for the performance of its obligations hereunder
with any one or more persons; provided, however, that CFBDS shall not enter into
any such subcontract unless the Trustees of the Trust shall have found the
subcontracting party to be qualified to perform the obligations sought to be
subcontracted; and provided, further, that, unless the Trust otherwise expressly
agrees in writing, CFBDS shall be as fully responsible to the Trust for the acts
and omissions of any subcontractor as it would be for its own acts or omissions.
10. The terms "vote of a majority of the outstanding voting securities",
"interested person", "assignment" and "specifically approved at least annually"
shall have the respective meanings specified in, and shall be construed in a
manner consistent with, the 1940 Act, subject, however, to such exemptions as
may be granted by the Securities and Exchange Commission thereunder, and
provided, however, that the term "assignment" shall include (without limitation)
any sale, transfer or conversion of a controlling interest of any class of
voting stock of CFBDS or of any entity which holds a controlling interest of any
class of voting stock of CFBDS or another such entity.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names on their behalf by the undersigned,
thereunto duly authorized, and their respective seals to be hereto affixed, all
as of the day and year first above written. The undersigned Trustee of the Trust
has executed this Agreement not individually, but as Trustee under the Trust's
Declaration of Trust, dated August 30, 1985, as amended, and the obligations of
this Agreement are not binding upon any of the Trustees or shareholders of the
Trust individually, but bind only the Trust estate.
CITIFUNDS MULTI-STATE CFBDS, INC.
TAX FREE TRUST
/s/ Xxxxxx X. Xxxxxxxx /s/ Xxxxxx X. Xxxxxxxx
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By: Xxxxxx X. Xxxxxxxx By: Xxxxxx X. Xxxxxxxx
Title: President Title: President
