EXHIBIT (e)(2)
DISTRIBUTION AGREEMENT
DISTRIBUTION AGREEMENT, made the 3rd day of March, 2000, as amended May
25, 2000 and further amended February 28, 2002 by and between The Navellier Top
20 Portfolio, The Navellier International Growth Portfolio, The Navellier Large
Cap Growth Portfolio, The Navellier All Cap Growth Portfolio, The Navellier Mid
Cap Growth Portfolio and The Navellier Money Market Portfolio (the
"Portfolios"), portfolios of The Navellier Millennium Funds, a business trust
organized under the laws of the State of Delaware (the "Fund"), and Navellier
Securities Corp., a corporation (the "Distributor").
WITNESSETH
WHEREAS, the Fund is registering as an investment company under the
Investment Company Act of 1940, as amended (the "1940 Act"), and intends to
engage in business as an open-end management investment company;
WHEREAS, each Portfolio desires to employ the Distributor to act as
principal underwriter (as defined in the Act) with respect to the continuous
offering of its Class B Shares, at no par value (the "Shares"), and the
Distributor is willing to serve in such capacity pursuant to the terms and
conditions of this Agreement;
WHEREAS, this Agreement is being entered into pursuant to the
distribution plan adopted by the Portfolios in respect of the Shares pursuant to
Rule 12b-1 adopted under the 1940 Act (the "Distribution Plan") and has been
approved by a vote of the Board of Trustees of the Fund, including a majority of
the Trustees who are not "interested persons" of the Fund, as defined in the
Act, and who have no direct, or indirect financial interest in the operation of
this Agreement (the "Disinterested Trustees") cast in person at a meeting called
for the purpose of voting on this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt of which is
hereby acknowledged, it is agreed by and between the parties hereto as follows:
1. APPOINTMENT OF THE DISTRIBUTOR.
(a) Each Portfolio hereby appoints the Distributor as the
principal distributor of the Portfolio's Shares whether now existing or
hereafter created, to sell and to arrange for the sale of Shares to the public
on the terms set forth in this Agreement and the Distributor hereby accepts such
appointment and agrees to act in accordance herewith. The Portfolio, during the
term of this Agreement, shall sell Shares to the Distributor upon the terms and
conditions set forth herein.
(b) The Distributor agrees to purchase Shares, as principal for
its own account, from the Portfolio and to sell Shares, as principal, to
investors and dealers, upon the terms described herein and in the Portfolio's
prospectus (the "Prospectus") and statement of additional information (the
"Statement of Additional Information") included in the Fund's Registration
Statement (the "Registration Statement") last filed with the Securities and
Exchange Commission (the "SEC") and declared effective under the 1933 Act and
1940 Act or
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as said Prospectus and Statement of Additional Information may be otherwise
amended or supplemented from time to time thereafter.
2. EXCLUSIVE NATURE OF DUTIES. The Distributor shall be the exclusive
representative of each Portfolio, and act as its principal underwriter and
distributor of the Shares of each Portfolio, except that neither the exclusive
rights granted to the Distributor to sell the Shares nor the right to receive
compensation under Section 3(b) hereof or otherwise hereunder shall apply to
Shares issued by the Fund (i) in connection with the merger or consolidation of
any other investment company or personal holding company with the Fund or the
Portfolios or the acquisition by purchase or otherwise of all (or substantially
all) of the assets or outstanding shares of any such company by the Fund or the
Portfolios, or (ii) pursuant to reinvestment of dividends or capital gains
distributions.
3. PURCHASE OF SHARES FROM THE PORTFOLIO AND COMPENSATION OF
DISTRIBUTOR.
(a) Subsequent to the effective date of the Registration
Statement, each Portfolio will commence a continuous offering of the Shares.
During such continuous offering, the Distributor shall have the right to buy
from each Portfolio the Shares needed, but not more than the Shares needed
(except for clerical errors in transmissions), to fill unconditional orders for
Shares placed with the Distributor by investors or securities dealers. The price
which the Distributor shall pay for the Shares so purchased from a Portfolio
shall be the net asset value (determined as set forth in Section 3(e) hereof)
used in determining the public offering price on which such orders were based.
(b) In consideration of the Distributor's services as principal
distributor of a Portfolio's Shares pursuant to this Distribution Agreement and
the Portfolio's Distribution Plan in respect of the Shares, each Portfolio
agrees: (i) to pay to the Distributor monthly in arrears its "Allocable Portion"
(as hereinafter defined) of a fee (the "Distribution Fee") which shall accrue
daily in an amount equal to the product of (A) 1/365th of 0.75% per annum
multiplied by (B) the net asset value of the Shares of the Portfolio outstanding
on such day and (ii) to withhold from redemption proceeds such Distributor's
Allocable Portion of the Contingent Deferred Sales Charges ("CDSCs") in respect
of the Shares and to pay the same over to such Distributor or at its direction.
In addition, in consideration of the Distributor's provision of, or arranging
for the provision of, shareholder services to persons who purchase Shares, the
Portfolio agrees to pay the Distributor monthly in arrears a fee (the
"Shareholder Servicing Fee") which shall accrue daily in an amount equal to the
product of (A) 1/365th of 0.25% per annum multiplied by (B) the net asset value
of the Shares of the Portfolio outstanding on such day. The Distributor may pay
all or any portion of the Shareholder Servicing Fee to securities dealers for
providing such shareholder services in respect of particular Shares. If, in lieu
of allowing a portion of the Shareholder Servicing Fee relating to a particular
Share to a securities dealer in consideration of such securities dealer
providing shareholder services to such Share for the twelve month period
following the issuance thereof, and for annual twelve month periods thereafter
during which Shares are held, the Distributor makes a payment to such securities
dealer on the settlement date for the issuance of such Share, and during
subsequent annual twelve month periods, in consideration of such security
dealer's commitment to provide such services for such twelve month period, and
during subsequent
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annual twelve month periods, without further compensation the Distributor will
be deemed to have earned the Shareholder Servicing Fee that accrues in respect
of such Share during each such twelve month period (the "Earned Service Fee")
upon making such payment to such securities dealer and all of the provisions of
the Distribution Plan referred to in Section 3(c) below shall apply to the
Earned Service Fee, in the same manner as they apply to the Distributor's
Allocable Portion of the Distribution Fee and for this purpose references in the
provisions of the Distribution Plan referred to in Section 3(c) hereof to
"Distribution Fees" shall be deemed to include Earned Service Fees and
references in such provision to the financing of distribution services shall be
deemed to include financing of shareholder services.
(c) Each of the provisions set forth in the third sentence,
including clauses (I) through (IV) thereof, of a Portfolio's Distribution Plan
as in effect on the date hereof, together with the related definitions, are
hereby incorporated herein by reference with the same force and effect as if set
forth herein in its entirety.
(d) The Distributor's Allocable Portion of the Distribution Fee
and CDSCs shall be 100% until it ceases to be the principal distributor of the
Portfolio's Shares and thereafter shall be determined in a manner, to be agreed
between a Portfolio and the Distributor, that fairly allocates the Distribution
Fee and CDSCs among the Distributor and the successor distributors in proportion
to the outstanding Shares attributable to their respective efforts.
(e) The Shares are to be resold by the Distributor to investors
at the public offering price, as set forth in Section 3(d) hereof, or to
Selected Dealers (as hereinafter defined) having agreements with the Distributor
upon the terms and conditions set forth in Section 7 hereof.
(f) The public offering price(s) of the Shares, i.e., the price
per share at which the Distributor or Selected Dealers (as hereinafter defined)
may sell the Shares to the public, shall be the public offering price as set
forth in the then current Prospectus and the Statement of Additional Information
relating to the Shares. If the public offering price does not equal an even
cent, the public offering price may be adjusted to the nearest cent. All
payments to a Portfolio hereunder shall be made in the manner set forth in
Section 3(g).
(g) The net asset value of the Shares of each Portfolio shall be
determined by the Fund or any agent of the Fund once daily at the times and
otherwise in accordance with the terms set forth in the Prospectus and the
Statement of Additional Information and guidelines established by the Board of
Trustees of the Fund, from time to time.
(h) The Fund shall have the right to suspend the sale of the
Shares at times when redemption is suspended pursuant to the conditions set
forth in Section 4(c) hereof. The Fund shall also have the right to suspend the
sale of the Shares if trading on the New York Stock Exchange or other exchange
shall have been suspended, if a banking moratorium shall have been declared by
federal or state authorities, or if there shall have been some other
extraordinary event, which, in the judgment of the Fund, makes it impracticable
to sell the Shares. The Fund also reserves the right to suspend the sale of
Shares at any time, in the absolute discretion of its Board of Trustees.
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(i) Each Portfolio, or any agent of a Portfolio designated in
writing by the Fund, shall be promptly advised of all purchase orders for Shares
received by the Distributor. Any order may be rejected by a Portfolio; PROVIDED,
HOWEVER, that the Portfolio will not arbitrarily or without reasonable cause
refuse to accept orders for the purchase of Shares. The Distributor (or its
agent) upon receipt of payment therefore will enter the purchase and ownership
on its books (in lieu of issuing stock certificates) or a statement confirming
the issuance of Shares. The Distributor agrees to cause such payment and such
instructions to be delivered promptly to the Portfolio (or its agent).
4. REPURCHASE OR REDEMPTION OF SHARES.
(a) Any of the outstanding shares of any portfolio may be
tendered for redemption at any time, and each Portfolio agrees to redeem the
Shares so tendered in accordance with the applicable provisions set forth in the
Prospectus and the Statement of Additional Information. The price to be paid to
redeem the Shares shall be equal to the net asset value calculated in accordance
with the provisions of Section 3(e) hereof. All payments by a Portfolio
hereunder shall be made in the manner set forth below.
Each Portfolio, shall pay the total amount of the redemption
price subsequent to its having received the notice of redemption in proper form,
all in accordance with applicable provisions of the Prospectus and the Statement
of Additional Information on or before the seventh day after receipt of notice
of redemption.
(b) The Distributor is authorized, as agent for each Portfolio,
to repurchase Shares from investors and Selected Dealers in accordance with the
applicable provisions set forth in the then current Prospectus and the Statement
of Additional Information. The Distributor shall promptly transmit to the Fund's
transfer agent for redemption, all orders so received from Selected Dealers or
investors for the repurchase of Shares. The Distributor shall be responsible for
the accuracy of instructions transmitted to the Fund's transfer agent in
connection with all such repurchases.
(c) The Fund may suspend the right of redemption or dealer
payment more than seven days (a) during any period when the New York Stock
Exchange or other exchange is closed (other than a customary weekend and holiday
closing), (b) when trading on any Exchange is restricted or an emergency exists
as determined by the Securities and Exchange Commission or the Fund so that
disposal of the Fund's investments or determination of the net asset value of a
Portfolio is not reasonably practicable, or (c) during any other period when the
Securities and Exchange Commission, by order, so permits.
5. DUTIES OF THE PORTFOLIO.
(a) Each Portfolio shall furnish to the Distributor copies of
all information (including, without limitation, sales literature and
advertisements), financial statements and other papers prepared (or caused by
the Fund to be prepared) for publication or distribution
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which refer in any way to the Distributor, prior to the use thereof, and shall
not use such material if the Distributor reasonably objects in writing within
five (5) business days (or such other time as may be mutually agreed) after
receipt thereof. The foregoing sentence shall survive the termination of this
Agreement. Each Portfolio shall furnish or otherwise make available to the
Distributor such other information as the Distributor may reasonably request for
use in connection with the distribution of the Shares, including one certified
copy, upon request by the Distributor, of all financial statements prepared by
the Fund, in respect of the Portfolio, and examined by independent accountants.
Each Portfolio shall, subject to the provisions of Section 8 hereof, make
available to the Distributor such number of copies of the Prospectus and the
Statement of Additional Information as the Distributor shall reasonably request.
(b) The Fund shall take, from time to time, but subject to the
necessary approval of each Portfolio's shareholders (as may be required by
applicable law), all necessary action to fix the number of its authorized Shares
and to register the Shares under the 1933 Act, to the end that there will be
available for sale such number of the Shares as investors may reasonably be
expected to purchase.
(c) Each Portfolio shall use its best efforts to qualify and
maintain the qualification of an appropriate number of the Shares for sale under
the securities laws of such states as the Distributor and the Portfolio may
approve. Any such qualification may be withheld, terminated or withdrawn by a
Portfolio at any time in its discretion. The Distributor shall furnish such
information and other material relating to its affairs and activities as may be
required by a Portfolio in connection with such qualification.
(d) The Fund shall immediately advise the Distributor (i) when
any post-effective amendment to its Registration Statement or any further
amendment or supplement thereto or any further Registration Statement or
amendment or supplement thereto becomes effective, (ii) of any request by the
SEC for amendment to the Registration Statement or the then effective Prospectus
or for additional information, (iii) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement, or the
initiation of any proceedings for that purpose, and (iv) of the happening of any
event which makes untrue any material statement made in the Registration
Statement or the current Prospectus or which, in the opinion of counsel for the
Fund, requires the making of a change in the Registration Statement or the
current Prospectus in order to make the statements therein not misleading. In
case of the happening at any time of any event which materially affects the Fund
or its securities and which should be set forth in a supplement to or an
amendment of the then effective Prospectus in order to make the statements
therein not misleading, the Fund shall prepare and furnish to the Distributor
such amendment or amendments to the then effective Prospectus, as will correct
the Prospectus so that as corrected it will not contain, or such supplement or
supplements to the then effective Prospectus which, when read in conjunction
with the then effective Prospectus, will make the combined information not
contain any untrue statement of a material fact or any omission to state any
material fact necessary in order to make the statements in the then effective
Prospectus not misleading. The Fund shall, if at any time the SEC shall issue
any stop order suspending the effectiveness of the Registration Statement, make
reasonable effort to obtain the prompt lifting of such order.
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(e) Except as otherwise contemplated by Section 8(a) hereof, the
Fund shall, at the expense of the Distributor, furnish, in reasonable quantities
upon request of the Distributor, copies of Prospectuses, Statements of
Additional Information, Proxies and annual and interim reports of the Fund, in
respect of the Portfolio.
6. DUTIES OF THE DISTRIBUTOR.
(a) The Distributor shall devote reasonable time and effort to
effect sales of the Shares (but only in states and other jurisdictions in which
it may legally do so), but shall not be obligated to sell any specific number of
Shares. The services of the Distributor hereunder are not to be deemed exclusive
and nothing herein contained shall prevent the Distributor from entering into
distribution or dealer arrangements with other investment companies so long as
the performance of its obligations hereunder are not impaired thereby.
(b) Neither the Distributor nor any Selected Dealer nor any
other person is authorized by the Fund to give any information or to make any
representations, other than those contained in the Registration Statement or
related Prospectus and Statement of Additional Information and any sales
literature specifically approved by the Fund.
(c) The Distributor shall cooperate with each Portfolio in
effecting the qualifications contemplated by Section 5(c) hereof.
(d) The Distributor shall furnish to each Portfolio copies of
all information including, without limitation, sales literature and
advertisements, financial statements and other papers prepared (or caused by the
Distributor to be prepared) for the publication or distribution, which refer in
any way to the Portfolio, prior to the use thereof, and shall not use such
material if the Portfolio reasonably objects in writing within (5) business days
(or such other time as may be mutually agreed) after receipt thereof. The
foregoing sentence shall survive the termination of this Agreement.
(e) In selling the Shares, the Distributor shall use its best
efforts in all respects to duly conform with the requirements of all applicable
federal, state and foreign laws. In connection therewith, the Distributor shall
use its best efforts in granting any Distributor's Consent under Section 7(b)
hereof, to make certain that such Foreign Offer or Sale does not violate
applicable law or otherwise cause the Fund to have any liability with respect to
such Foreign Offer or Sale.
7. SELECTED DEALER AGREEMENTS.
(a) The Distributor shall have the right to enter into selected
dealer agreements ("Selected Dealer Agreements") with securities dealers of its
choice (the "Selected Dealers") for the sale of Shares. In connection with such
sales by Selected Dealers, the Selected Dealer Agreement shall provide that the
portion of the Sales Charge which may be allocated to Selected Dealers shall be
limited to all or a portion of the Sales Charge as stated in a Portfolio's then
current Prospectus. In making agreements with Selected Dealers, the
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Distributor shall act only as principal and not as agent for a Portfolio. Shares
sold to Selected Dealers shall be for resale by such dealers only at the public
offering price(s) set forth in the Prospectus and the Statement of Additional
Information.
(b) The Distributor shall offer and sell Shares only to such
Selected Dealers as are (i) members in good standing of the National Association
of Securities Dealers (the "NASD"), or (ii) exempt from membership in the NASD.
In any Selected Dealer Agreement, the Distributor shall require the Selected
Dealer to obtain the written consent of the Distributor (the "Distributor's
Consent") prior to such Selected Dealer's making, causing to be made or
otherwise participating, directly or indirectly, in the making of any offer or
sale of any of the Fund's shares to any individual, corporation, partnership,
trust, joint venture, or other person or entity located outside of the United
States of America (a "Foreign Offer or Sale"). Such Selected Dealer Agreements
shall also provide that any Foreign Offer or Sale shall be made only upon the
terms and in accordance with the conditions set forth in the Distributor's
Consent.
(c) The Distributor shall adopt and follow procedures, as
approved by each Portfolio, for the confirmation of sales and Shares to
investors and Selected Dealers, the collection of amounts payable by investors
and Selected Dealers on such sales, and the cancellation of unsettled
transactions, as may be necessary to comply with the requirements of the
National Association of Securities Dealers, as such requirements may from time
to time exist.
8. COMPENSATION AND EXPENSES.
(a) Pursuant to its Distribution Plan, and in order to further
enhance the distribution of the Shares, each Portfolio shall, on a monthly
basis, pay the Distributor the Distribution Fee and Shareholder Servicing Fee
described in Section 3(b) hereof. Out of said fees, the Distributor shall pay
the distribution expenditures which expenditures shall include, but shall not be
limited to, the payment of compensation (including incentive compensation such
as continuing payments) to financial consultants, sales and marketing personnel,
broker-dealers, other financial institutions and other organizations to obtain
various distribution related services for the Portfolio and amounts payable
pursuant to arrangements entered into to fund the distribution effort. These
services include, among others, processing new shareholder account applications,
preparing and transmitting to the Fund's Transfer Agent computer processable
tapes of transactions by customers and serving as a source of information to
customers in answering their questions concerning the Portfolio and their
transactions with the Portfolio, expenses for advertising, the preparation and
distribution of sales literature and other promotional activities on behalf of
the Portfolio. Each Portfolio shall pay the cost of preparing, printing and
distributing the Prospectuses and Statements of Additional Information to
existing investors, the cost of (i) preparation, filing and printing of any
Registration Statements and Prospectuses required to be filed by or under
applicable federal, state or foreign law, (ii) the preparation and mailing of
annual and interim reports, Prospectuses and proxy material to current
shareholders, (iii) qualifications of Shares for sale under the securities laws
of such states or other jurisdiction as shall be selected by the Portfolio and
the Distributor in accordance with Section 5(c) hereof and the costs and
expenses payable to each such state or
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other jurisdiction for continuing qualifications therein. The Distributor and/
or Investment Advisor shall pay for the printing and distribution of
Prospectuses and Statements of Additional Information to prospective investors.
A Portfolio is not obligated to pay any distribution expenses in
excess of the distribution fees with respect to the Portfolio, pursuant to this
Section 8.(a). In addition, any expenses of distribution of a Portfolio's shares
accrued by the Distributor in any one fiscal year of the Portfolio may not be
paid from distribution fees received from the Portfolio in subsequent fiscal
years and also will not be used to pay any interest expense, carrying charges or
other financing costs or overhead of the Distributor. "Overhead costs" include
items of expense generally referred to as overhead, including, without
limitation, costs related to leases, depreciation, salaries, payroll taxes,
supplies and insurance. The Distribution Fees and Shareholder Servicing Fees
described in Section 3(b) hereof payable to the Distributor may exceed actual
expenses incurred by the Distributor, the Investment Advisor and/or others.
(b) A Portfolio shall not bear the expense of the registration
or qualification of the Distributor as a dealer or a broker under federal, state
or other applicable law or the expenses of continuing such registration or
qualification.
9. INDEMNIFICATION.
(a) Each Portfolio agrees with the Distributor, for the benefit
of the Distributor and each person, if any, who controls the Distributor within
the meaning of Section 15 of the Securities Act and each and all and any of
them, to indemnify and hold harmless the Distributor and any such controlling
person from and against any and all losses, claims, damages or liabilities,
joint or several (including reasonable legal fees and expenses) to which they or
any of them may become subject under the Securities Act or under any other
statute, at common law or otherwise, and to reimburse the Distributor and such
controlling persons, if any, for any legal or other expenses (including the cost
of any investigation and preparation) reasonably incurred by them in connection
with any litigation, whether or not resulting in any liability, insofar as such
losses, claims, damages, liabilities or litigation arise out of, or are based
upon, any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement or any Prospectus, filed with the SEC,
or any amendment thereof or supplement thereto, or which arise out of, or are
based upon 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; PROVIDED, HOWEVER, that this indemnity agreement shall not apply to
amounts paid in settlement of any such litigation if such settlement is effected
without the consent of the Portfolio or to any such losses, claims, damages,
liabilities or litigation arising out of, or based upon, any untrue statement or
alleged untrue statement of a material fact contained in any such Registration
Statement or prospectus, or any amendment thereof of or supplement thereof, or
arising out of, or based upon, 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, which statement or omission was made in
reliance upon information furnished in writing to the Portfolio by the
Distributor for inclusion in any such Registration Statement or Prospectus or
any amendment thereof or supplement thereto. The Distributor and each such
controlling person shall, within thirty (30) days after the complaint shall have
been
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served upon the Distributor or such controlling person in respect of which
indemnity may be sought from a Portfolio on account of its agreement contained
in this paragraph, notify the Portfolio in writing of the commencement thereof.
The omission of the Distributor or such controlling person so to notify the
Portfolio of any such litigation shall relieve the Portfolio from any liability
which it may have to the Distributor or such controlling person on account of
the indemnity agreement contained in this paragraph if such failure to timely
notify the Portfolio has resulted in substantial prejudice to the Portfolio, but
shall not relieve the Portfolio from any liability which it may have to the
Distributor or controlling person otherwise than on account of the indemnity
agreement contained in this paragraph. In case any such litigation shall be
brought against the Distributor or any such controlling person and notice of the
commencement thereof shall have been timely given to the Portfolio, the
Portfolio shall be entitled to participate in (and to the extent that it shall
wish, to direct) the defense thereof at its own expense, but such defense shall
be conducted by counsel of good standing and reasonably satisfactory to the
Distributor or such controlling person(s) or defendant(s) in the litigation. The
indemnity agreement of the Fund contained in this paragraph shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of the Distributor or any such controlling person, and shall
survive any delivery of shares of the Portfolio. Each Portfolio agrees to notify
the Distributor promptly of the commencement of any litigation or proceeding
against it or any of it officers or directors of which it may be advised in
connection with the issue and sale of shares of the Portfolio.
(b) Anything herein to the contrary notwithstanding, the
agreement in subparagraph (a) of this Section, insofar as it constitutes a basis
of reimbursement by a Portfolio for liabilities (other than payment by the
Portfolio of expenses incurred or paid in the successful defense of any action,
suit or proceeding) arising under the Securities Act, shall not extend to the
extent of any interest therein of any person who is an underwriter or a partner
or controlling person of an underwriter within the meaning of Section 15 of the
Securities Act or who, at the date of this Agreement, is a Trustee of the Fund,
except to the extent that an interest of such character shall have been
determined by a court of appropriate jurisdiction as not against public policy
as expressed in the Securities Act. Unless in the opinion of counsel for the
Fund the matter has been adjudicated by controlling precedent, a Portfolio,
will, if a claim for such reimbursement is asserted, submit to a court of
appropriate jurisdiction the question of whether or not such interest is against
the public policy as expressed in the Securities Act.
(c) The Distributor agrees to indemnify and hold harmless the
Fund and Portfolios and its Trustees and such officers as shall have signed any
Registration Statement filed with the Commission from and against any and all
losses, claims, damages, or liabilities, joint or several, to which each
Portfolio or such Trustees or officers may become subject under the Securities
Act, under any other statute, at common law or otherwise, and will reimburse
each Portfolio or such Trustees or officers for any legal or other expenses
(including the cost of any investigation and preparation) reasonably incurred by
it or them or any of them in connection with any litigation, whether or not
resulting in any liability, insofar as such losses, claims, damages,
liabilities, or litigation arise out of, or are based upon, any untrue statement
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, which
statement or omission was made by a
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Portfolio in reliance upon information furnished in writing to the Portfolio by
the Distributor for inclusion in any Registration Statement or any Prospectus,
or any amendment thereof or supplement thereto or otherwise for distribution or
publication. The Distributor shall not be liable for amounts paid in settlement
of any such litigation if such settlement was effected without its consent. A
Portfolio and its Trustees and such officers or defendant(s), in any such
litigation, shall, within thirty (30) days after the complaint shall have been
served upon the Portfolio or any such Trustee or officer in respect of which
indemnity may be sought from the Distributor on account of its agreement
contained in this paragraph, notify the Distributor in writing of the
commencement thereof. The omission of a Portfolio or such Trustee or officer so
to notify the Distributor of any such litigation shall relieve the Distributor
from any liability which it may have to the Portfolio or such Trustee or officer
of liability which t may have to the Portfolio or such Trustee or officer on
account of the indemnity agreement contained in this paragraph, but shall not
relieve the Distributor from any liability which it may have to the Portfolio or
such Trustee or officer otherwise than on account of the indemnity agreement
contained in this paragraph. In case any such litigation shall be brought
against a Portfolio or any such Trustee or officer and timely notice of the
commencement thereof shall have been so given to the Distributor, the
Distributor shall be entitled to participate in (and, to the extent it shall
wish, to direct) the defense thereof at its own expense, but such defense shall
be conducted by counsel of good standing and satisfactory to the Portfolio. The
indemnity agreement of the Distributor contained in this paragraph shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of the Portfolio and shall survive any delivery of shares of the
Portfolio. Each Portfolio agrees to notify the Distributor promptly of the
commencement of any litigation or proceeding against it or any of its officers
or Trustees or against any such controlling person of which it may be advised in
connection with the issue and sale of the Portfolio's shares.
(d) Notwithstanding any provision contained in this Agreement,
no party hereto and no person or persons in control of any party hereto shall be
protected against any liability to a Portfolio or its security holders to which
they would otherwise be subject by reason of willful misfeasance, bad faith, or
gross negligence, in the performance of their duties, or by reason of their
reckless disregard of their obligations and duties under this Agreement.
(e) Except as expressly provided in subparagraphs (a) and (c)
hereof, the agreements herein set forth have been made and are made solely for
the benefit of the Portfolios, the Distributor, and the persons expressly
provided for in subparagraphs (a) and (c), their respective heirs, successors,
personal representatives and assigns, and except as so provided, nothing
expressed or mentioned herein is intended or shall be construed to give any
person, firm or corporation, other than the Portfolios, the Distributor, and the
persons expressly provided for in subparagraphs (a) and (c), any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
representation, warranty or agreement herein contained. Except as so provided,
the terms "heirs, successors, personal representatives and assigns" shall not
include any purchaser of shares merely because of such purchase.
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10. DURATION, TERMINATION AND AMENDMENT OF THIS AGREEMENT.
This Agreement shall become effective on the date it shall be
approved by a vote of the Board of Trustees of the Fund and of a majority of the
disinterested Trustees, and shall, unless terminated as hereinafter provided,
continue in effect for a period of more than one (1) year from such date so long
as such continuance is specifically approved at least annually by a vote of the
Board of Trustees of the Fund and of a majority of the disinterested Trustees or
by vote of a majority of the outstanding voting securities of a Portfolio. This
Agreement may be terminated by a Portfolio at any time, without the payment of a
penalty, by vote of a majority of the members of the Board of Trustees of the
Fund who are not interested persons of the Fund and have no direct or indirect
financial interest in the operation of the Distribution Plan or in any agreement
related to the Plan or by a vote of a majority of the outstanding securities of
a Portfolio on sixty (60) days' written notice to the Distributor. In addition
this Agreement shall terminate in the event of its assignment. 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 and approved by a
majority of the disinterested Trustees.
11. NOTICES.
Any notice or other communication required to be given pursuant
to this Agreement shall be deemed duly given if delivered or mailed by
registered mail, postage prepaid, to the Distributor Navellier Securities Corp.
at Xxx Xxxx Xxxxxxx, Xxxxx Xxxxx, Xxxx, Xxxxxx 00000.
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12. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance
with the laws of the State of Nevada and any action arising out of a breach of
this Agreement shall be brought in the State or Federal Court in San Francisco,
California.
ATTEST: The Navellier Millennium Funds
By: /s/ XXXXX XXXXXX
------------------------ -----------------------------------------
Xxxxx Xxxxxx, Trustee
By: /s/
-----------------------------------------
Xxxx Xxxxxxx, Trustee
By: /s/
-----------------------------------------
Xxxxxxx Xxxxxxxxx, Trustee
By: /s/
-----------------------------------------
Xxxxx Xxxxxx, Trustee
By: /s/
-----------------------------------------
Xxxxx X. Xxxxxxxxx, Trustee
ATTEST: NAVELLIER SECURITIES CORP.
By: /s/
------------------------ -----------------------------------------
Xxxxx X. Xxxxxxxxx, President
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