Exhibit (e.1)
3/1/00
DISTRIBUTION AGREEMENT
iShares Trust
c/o Investors' Bank & Trust Company
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
April 25, 2000
SEI Investments Distribution Company
Xxx Xxxxxxx Xxxxxx Xxxxx
Xxxx, Xxxxxxxxxxxx 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 shares of each
Index Series of the Fund set forth on Exhibit A hereto, as such Exhibit may be
revised from time to time (each, an "Index Series"). For purposes of this
agreement the term "Shares" shall mean the authorized shares of the relevant
Index Series.
1. Services as Distributor
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1.1 You will act as the sole agent of the Fund for the distribution of Shares
in Creation Units (as defined herein) covered by, and in accordance with, the
registration statement and prospectus then in effect under the Securities Act of
1933, as amended (the "1933 Act") and will transmit promptly any orders received
by you for purchase or redemption of Shares in Creation Units to the Transfer
Agent for the Fund of which the Fund has notified you in writing. You shall
deliver or cause the delivery of a prospectus to persons purchasing Shares in
Creation Units and shall maintain records of both orders placed with you and
confirmations of acceptance furnished by you. You represent and warrant that
you are a broker-dealer registered under the Securities Exchange Act of 1934
(the "1934 Act") and a member of the National Association of Securities Dealers,
Inc. You agree to comply with all of the applicable terms and provisions of the
1934 Act.
1.2 You agree to use your best efforts to perform the services contemplated
herein on a continuous basis. It is contemplated that you may enter into
"Authorized Participant Agreements" with broker-dealers who agree to solicit
orders for Shares. In addition, 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. In entering into sales or servicing agreements, you will act only on
your own behalf as principal.
1.3 You shall act as distributor of Shares in Creation Units in compliance in
all material respects with all applicable laws, rules and regulations,
including, without limitations, 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 (the "1934 Act").
1.4 Whenever the parties hereto, in their collective judgment, mutually agree
that such action is warranted by unusual market, economic or political
conditions, or by abnormal circumstances of any kind deemed by them to render
sales of a Fund's Shares in Creation Units not in the best interest of the Fund,
the parties hereto may agree to decline to accept any orders for, or make any
sales of, any Shares in Creation Units until such time as the parties deem it
advisable to accept such orders and to make such sales.
1.5 The Fund agrees to pay all appropriate costs and expenses, including but
not limited to, all expenses in connection with the registration of Shares under
the 1933 Act and all expenses in connection with maintaining facilities for the
issue and transfer of Shares in Creation Units 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, except as such
payments may be made pursuant to Rule 12b-1 of the 0000 Xxx.
1.6 The Fund agrees to execute any and all documents and to furnish any and
all information and otherwise to take all actions which may be reasonably
necessary in the discretion of the Fund's officers in connection with the
qualification of Shares for sale in Creation Units in such states as you may
designate to the Fund and the Fund may approve, and the Fund agrees to pay all
expenses which may be incurred in connection with such qualification. 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 in Creation Units 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 in Creation Units, such information with respect to the Fund
or any relevant Index 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 Index 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 1933 Act, and under the 1940 Act, with respect to the Shares have been
prepared in conformity with the 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 which 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 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
not misleading. The Fund will give you reasonable notice in advance of its
filing of any amendment to any registration statement or supplement to any
prospectus; 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
sales and investor services agreements to use any prospectus in the form most
recently furnished by the Fund in connection with the sale of Shares in Creation
Units. 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 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 reasonable counsel fees incurred in
connection therewith) which you, your officers and directors, or any such
controlling persons, may incur under the 1933 Act, the 1940 Act or common law or
otherwise, (a) 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 (b) 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 not misleading, (c) arising out
of breach of any obligation, representation or warranty pursuant to this
Agreement by the Fund, or (d) the Fund's failure to comply with applicable
securities laws, 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 Funds or their 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's being notified of any action brought against you, your 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 which 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, 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 reasonable fees and expenses of any counsel retained by you or them. 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 or other
affiliates, 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 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 Fund, its officers or Board members, or any
such controlling person, may incur under the 1933 Act, the 1940 Act, 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 information, statements or representations made or provided by you in any
sales literature or advertisements, or any Disqualifying Conduct by you in
connection with the offering and sale of any Shares, (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 not
misleading, (c) arising out of your breach of any obligation, representation or
warranty pursuant to this Agreement, or (d) your failure to comply in any
material respect with applicable securities laws. Your agreement to indemnify
the Fund, its officers and Board members, and any such controlling person, as
aforesaid, is expressly conditioned upon 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. The
failure so to notify you of any such action shall not relieve you from any
liability which 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, otherwise
than on account of your indemnity agreement contained in this paragraph. You
will be entitled to assume the defense of such action, but, in such case, such
defense shall be conducted by counsel of good standing chosen by you and
approved by an executive officer of the Fund, if such action is based solely
upon such alleged misstatement or omission on your part, and in any other event
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. 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 1933
Act or if and so long as a current prospectus as required by Section 10 of said
Act 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 any application to or bearing upon the Fund's obligation to redeem or
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 of the occurrence
of any of the following events, as soon as any such event comes to the attention
of the Fund:
(a) any request by the Securities and Exchange Commission for material
amendments to the registration statement or prospectus then in effect or for
additional information;
(b) 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) the happening of any event which makes untrue any statement of a
material fact made in the registration statement or prospectus then in effect
or which requires the making of a change in such registration statement or
prospectus in order to make the statements therein not misleading; and
(d) all material actions of the Securities and Exchange Commission with
respect to any amendments to any registration statement or prospectus which
may from time to time be filed with the Securities and Exchange Commission.
2. Offering Creation Units
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Shares in Creation Units of each Index Series will be offered for sale
by you at a price per Creation Unit in the manner set forth in the then-current
prospectus, based on a net asset value determined in accordance with the Fund's
prospectus and charter documents. Any payments to dealers shall be governed by a
separate agreement between you and such dealer and the Fund's then-current
prospectus.
You will accept as compensation for the performance of your obligations
hereunder such compensation, if any, as may be provided for in any plan of
distribution adopted by the Fund with respect to the Fund or any Index Series
pursuant to Rule 12b-1 under the 1940 Act; or (b) the Service Standards
Agreements, made as of March 24, 2000, by and among you, Barclays Global Fund
Advisors and Barclays Global Investors, N.A.
3. Term
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This Agreement shall become effective with respect to each Index Series
of the Fund as of the date hereof and will continue for an initial two-year term
and is renewable annually thereafter so long as such continuance is specifically
approved (i) by the Fund's Board on behalf of each Index Series or (ii) by a
vote of a majority (as defined in the 0000 Xxx) of the Shares of the Fund or the
relevant Index 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 the 0000 Xxx) of any party to this
Agreement, by vote cast in person at a meeting called for the purpose of voting
on such approval. This agreement may be terminated in respect of an Index
Series at any time, without the payment of any penalty, (i) by vote of a
majority of the Directors who are not interested persons of the Fund (as defined
under the 0000 Xxx) or (ii) by vote of a majority (as defined under the 0000
Xxx) of the outstanding voting securities of the relevant Index Series, on at
least 60 days' written notice to you. This agreement may also be terminated at
any time by you, without the payment of any penalty, upon 60 days' notice by you
and will terminate automatically in the event of its assignment (as defined
under the 1940 Act).
4. Miscellaneous
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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 laws of the State of New York,
without regard 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. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors.
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,
iSHARES TRUST
By: /s/ Xxxxxx Most
Accepted:
SEI INVESTMENTS DISTRIBUTION COMPANY
By: /s/ Xxxxx X. Xxxxx, Esq.
EXHIBIT A
INDEX SERIES OF THE iSHARES TRUST
iShares S&P 500 Fund
iShares S&P 100 Fund
iShares S&P 000/XXXXX Xxxxxx Fund
iShares S&P 500/BARRA Value Fund
iShares S&P MidCap 400 Fund
iShares S&P MidCap 000/XXXXX Xxxxxx Fund
iShares S&P MidCap 400/BARRA Value Fund
iShares S&P SmallCap 600 Fund
iShares S&P SmallCap 600 Fund/BARRA Growth Fund
iShares S&P SmallCap 600 Fund/BARRA Value Fund
iShares S&P Euro Plus Fund
iShares S&P/TSE 60 Fund
iShares Dow Xxxxx Total Market Fund
iShares Dow Xxxxx U.S. Basic Materials Sector Fund
iShares Dow Xxxxx U.S. Consumer Cyclicals Sectors Fund
iShares Dow Xxxxx U.S. Consumer Non-Cyclicals Sector Fund
iShares Dow Xxxxx U.S. Energy Sector Fund
iShares Dow Xxxxx U.S. Financial Sector Fund
iShares Dow Xxxxx U.S. Healthcare Sector Fund
iShares Dow Xxxxx U.S. Industrials Sector Fund
iShares Dow Xxxxx U.S. Technology Sector Fund
iShares Dow Xxxxx U.S. Telecommunications Sector Fund
iShares Dow Xxxxx U.S. Utilities Sector Fund
iShares Dow Xxxxx U.S. Chemicals Fund
iShares Dow Xxxxx U.S. Financial Services Fund
iShares Dow Xxxxx Internet Fund
iShares Dow Xxxxx U.S. Real Estate Fund
iShares Xxxxxxx 3000 Fund
iShares Xxxxxxx 3000 Growth Fund
iShares Xxxxxxx 3000 Value Fund
iShares Xxxxxxx 2000 Fund
iShares Xxxxxxx 2000 Growth Fund
iShares Xxxxxxx 2000 Value Fund
iShares Xxxxxxx 1000 Fund
iShares Xxxxxxx 1000 Growth Fund
iShares Xxxxxxx 1000 Value Fund
