Exhibit 99
HERITAGE CAPITAL APPRECIATION TRUST
REVISED AND RESTATED
DISTRIBUTION AGREEMENT
This Distribution Agreement is made this 22nd day of November 1985, as
revised and restated on August 27, 2001, by and between Heritage Capital
Appreciation Trust, a Massachusetts business trust (the "Trust"), and Xxxxxxx
Xxxxx & Associates, Inc., a Florida corporation (the "Distributor").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission as an open-end, management investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"), and has registered its shares
of beneficial interest ("Shares") for sale to the public under the Securities
Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Trust offers for public sale one or more distinct series of
Shares as listed on Exhibit A to this Agreement ("Series"); and
WHEREAS, the Trust's Board of Trustees has divided the Shares of each
Series into one or more classes (each, a "Class"), designated Class A, Class B,
and Class C, as listed on Exhibit A; and
WHEREAS, the Trust wishes to retain the Distributor as principal
underwriter in connection with the offering and sale of the Classes of Shares of
each Series listed on Exhibit A (as amended from time to time) to this Agreement
and to furnish certain other services to the Trust as specified in this
Agreement; and
WHEREAS, the Distributor is willing to accept such appointment to furnish
such services on the terms and conditions hereinafter set forth; and
WHEREAS, this Agreement has been approved by a vote of the Trust's Board
of Trustees and certain disinterested Trustees in conformity with Paragraph
(b)(2) of Rule 12b-1 under the 1940 Act; and
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT OF THE DISTRIBUTOR. (a) The Trust hereby appoints the
Distributor as principal underwriter in connection with the offering and sale of
Shares of each Class of each Series, and the Distributor accepts the
appointment. The Trust authorizes the Distributor, as exclusive agent for the
Trust, for any existing Series and upon commencement of operations of any future
Series, and subject to applicable federal and state law and the Declaration of
Trust, Bylaws and the Prospectus and Statement of Additional Information, to:
(a) promote the Series; (b) solicit orders for the purchase of the Shares of the
Series subject to such terms and conditions as the Trust may specify; and (c)
hold itself available to receive orders for the purchase of the Shares of the
Series, to accept orders for the purchase of the Shares of the Series, and to
accept such orders on behalf of the Trust as of the time of receipt of such
orders and promptly transmit such orders as are accepted to the Trust and its
transfer agent (collectively, "Distribution Services"). The Distributor shall
offer the Shares of each Series on an agency or "best efforts" basis under which
the Trust shall only issue such Shares as are actually sold. In connection with
such sales and offers of sales, the Distributor shall give only such information
as is permitted by applicable law, and the Trust shall not be responsible in any
way for any other information, statements or representations given or made by
the Distributor or its representatives or agents.
(b) The Distributor shall provide ongoing shareholder liaison services,
including responding to shareholder inquiries, providing shareholders with
information on their investments, and any other services now and hereafter
deemed to be appropriate services for the payment of "service fees" under
Conduct Rule 2830 of the National Association of Securities Dealers, Inc.
("NASD") (collectively, "Shareholder Services").
2. TRUST OBLIGATIONS. The Trust shall keep the Distributor fully informed
of its affairs and shall make available to the Distributor copies of all
information, financial statements, and other papers that the Distributor
reasonably may request for use in connection with the distribution of Shares,
including, without limitation, certified copies of any financial statements
prepared for the Trust by its independent public accountant and such reasonable
number of copies of the most current Prospectus, Statement of Additional
Information, and annual and semi-annual reports to shareholders of a Series as
the Distributor may request, and the Trust shall cooperate fully in the efforts
of the Distributor to sell and arrange for the sale of the Shares of a Series
and in the performance of the Distributor under this Agreement.
3. THE DISTRIBUTOR AS AGENT. The Distributor shall act as agent of the
Trust on behalf of the Series in connection with the sale and repurchase of
Shares. Except with respect to such sales and repurchases, the Distributor shall
act as principal in all matters relating to the promotion of the sale of Shares
of the Series and shall enter into all of its own engagements, agreements and
contracts as principal on its own account. The Distributor may enter into
agreements with registered dealers and financial institutions it may select for
the performance of Distribution and Shareholder Services and may enter into
agreements with dealers and other qualified entities to perform recordkeeping
and sub-accounting services, as well as Shareholder Services, the form of such
agreements to be as mutually agreed upon and approved by the Trust and the
Distributor. Each agreement shall provide that such dealer or other entity shall
act as principal, and not as an agent, of the Trust on behalf of the Series.
4. PUBLIC OFFERING PRICE. The public offering price of each Class of
Shares of each Series is equal to the net asset value per share of the
outstanding Shares of a Series plus any applicable sales charges as described in
the Trust's Registration Statement. The net asset value per share shall be
determined in accordance with the provisions of the Trust's Registration
Statement. The Trust shall make available to the Distributor a statement of each
computation of net asset value and of the details entering into such
computation.
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5. COMPENSATION. (a) As compensation for providing Distribution Services
under this Agreement, the Distributor shall retain the sales charge, if any, on
purchases of Shares as set forth in the Registration Statement. The Distributor
is authorized to collect the gross proceeds derived from the sale of the Shares,
remit the net asset value thereof to the Series upon receipt of the proceeds and
retain the sales charge, if any.
(b) The Distributor also shall receive from each Series a distribution fee
and a service fee at the rates and under the terms and conditions of the
Distribution Plans ("Plans") adopted by each Class of a Series, as such Plans
are in effect from time to time, and subject to any further limitations on such
fees as the Trust's Board of Trustees may impose. Such fees are set forth in
Exhibit A.
(c) The Distributor may reallow any or all of the sales charge,
distribution fee and service fee that it has received under this Agreement to
such dealers or sub-accountants as it may from time to time determine; provided,
however, that unless permitted under the rules of the NASD, the Distributor may
not reallow to any dealer for Shareholder Services an amount in excess of 0.25%
of the average annual net asset value of the shares with respect to which said
dealer provides Shareholder Services.
(d) The Distributor may pay to dealers and other financial institutions
through whom Classes of Shares are sold, such sales commission as the
Distributor may specify from time to time. Payment of any such sales commissions
shall be the sole obligation of the Distributor.
(e) No provision of this Agreement shall be deemed to prohibit any
payments by a Class of a Series to the Distributor or by a Class of a Series or
the Distributor to investment dealers, financial institutions and 401(k) plan
service providers where such payments are made under a distribution plan adopted
by the Series pursuant to Rule 12b-1 under the 1940 Act or from the
Distributor's own resources.
6. ACCEPTING AND REJECTING ORDERS. The Distributor will accept orders for
the purchase of Shares of a Series only to the extent of purchase orders
actually received and not in excess of such orders, and it will not avail itself
of any opportunity of making a profit by expediting or withholding orders. It is
mutually understood and agreed that the Trust may reject purchase orders where,
in the judgment of the Trust, such rejection is in the best interest of the
Trust.
7. DUTIES AND EXPENSES OF THE TRUST. (a) The Trust agrees, at its own
expense, to register the Shares with the Securities and Exchange Commission and
to prepare and file from time to time such Prospectuses, Statements of
Additional Information, amendments, reports and other documents as may be
necessary to maintain the Registration Statement. Each Series shall bear all
expenses related to preparing and printing the Prospectuses, Statements of
Additional Information and other materials required by law and such other
expenses, including printing and mailing expenses, related to the Series'
communications with persons who are shareholders of that Series.
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(b) Each Series 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 Trust's officers in connection with the
qualification of Shares for sale in such states as the Distributor may designate
to the Series and the Series may approve, and the Series agrees to pay all
expenses which may be incurred in connection with such qualification.
8. DUTIES AND EXPENSES OF THE DISTRIBUTOR. The Distributor shall finance
activity that is intended to result in the sale and retention of Shares of each
Class of each Series including, but not limited to, compensation paid to
registered representatives of the Distributor and to participating dealers that
have entered into sales agreements with the Distributor, advertising, salaries
and other expenses of the Distributor relating to selling or servicing efforts,
expenses of organizing and conducting sales seminars, printing of Prospectuses,
Statements of Additional Information and reports for other than existing
shareholders, preparation and distribution of advertising material and sales
literature and other sales promotion expenses. The Distributor shall pay all
expenses connected with its own qualification as a dealer under state or federal
laws. Except as specifically provided in this Agreement, the Trust and the
Series shall bear none of the expenses of the Distributor in connection with its
offer and sale of each Class of Shares.
9. INDEMNIFICATION. (a) The Trust agrees to indemnify, defend and hold
harmless the Distributor, its several officers and directors, and any person who
controls the Distributor within the meaning of Section 15 of the 1933 Act 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 Distributor, its
officers or directors, or any such controlling person may incur under the 1933
Act or under common law or otherwise arising out of or based upon any alleged
untrue statement of a material fact contained in the Registration Statement,
Prospectus or Statement of Additional Information or arising out of or based
upon any alleged omission to state a material fact required to be stated in
either thereof or necessary to make the statements in either thereof not
misleading, provided that in no event shall anything contained in this Agreement
be construed so as to protect the Distributor against any liability to the Trust
or its shareholders to which the Distributor would otherwise be subject by
reason of willful misfeasance, bad faith, or gross negligence in the performance
of its duties, or by reason of its reckless disregard of its obligations and
duties under this Agreement, and further provided that the Trust shall not
indemnify the Distributor for conduct as set forth in paragraph 9(b) below. The
Distributor agrees that it shall look only to the assets of a particular Series
or Class, as applicable, and not to any other Series or Class for satisfaction
of any obligation created by this paragraph or otherwise arising under this
Agreement.
(b) The Distributor agrees to indemnify, defend and hold harmless the
Trust, its several officers and directors, and any person who controls the Trust
within the meaning of Section 15 of the 1933 Act 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 Trust, its officers or Trustees, or any such
controlling person may incur under the 1933 Act or under common law or otherwise
arising out of or based upon any alleged untrue statement of a material fact
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contained in information furnished in writing by the Distributor to the Trust
for use in the Registration Statement, Prospectus or Statement of Additional
Information or arising out of or based upon any alleged omission to state a
material fact in connection with such information required to be stated in the
Registration Statement, Prospectus or Statement of Additional Information or
necessary to make such information not misleading.
10. WITHDRAWAL OF OFFERING. The Trust reserves the right at any time to
withdraw all offerings of the Shares by written notice to the Distributor at its
principal office.
11. CERTIFICATES. The Trust is not required to issue certificates
representing Shares. If the Trust elects to issue certificates and a shareholder
request for certificates is transmitted through the Distributor, the Trust will
cause certificates evidencing the Shares owned to be issued in such names and
denomination as the Distributor shall from time to time direct, provided that no
certificates shall be issued for fractional Shares.
12. REPURCHASE OF SHARES. The Distributor at its sole discretion may,
directly or through dealers, repurchase Shares offered for sale by the
shareholders. Repurchase of Shares of any Series by the Distributor shall be at
the net asset value of the applicable Series next determined after a repurchase
order has been received. On each business day, the Distributor shall notify, by
telex, electronic mail or in writing, the Trust and the Trust's transfer agent
of the orders for repurchase of Shares received by the Distributor since the
last such report, the amount to be paid for such Shares, and the identity of the
shareholders offering Shares for repurchase. Upon such notice, the Trust shall
pay the Distributor such amounts as are required by the Distributor for the
repurchase of such Shares in cash or in the form of a credit against moneys due
the Trust from the Distributor as proceeds from the sale of Shares. The
Distributor will receive no commission or other remuneration for repurchasing
Shares other than the compensation set forth in paragraph 5 hereof. The Trust
reserves the right to suspend such repurchases upon written notice to the
Distributor. The Distributor further agrees to act as agent for the Trust to
receive and transmit promptly to the Trust's transfer agent shareholder and
dealer requests for redemption of Shares.
13. INDEPENDENT CONTRACTOR STATUS. The Distributor is an independent
contractor and shall be agent for the Trust only with respect to the sale and
repurchase of the Shares.
14. NON-EXCLUSIVE SERVICES. The services of the Distributor to the Trust
under this Agreement are not to be deemed exclusive, and the Distributor shall
be free to render similar services or other services to others so long as its
services hereunder are not impaired thereby.
15. REPORTS TO THE BOARD. The Distributor shall prepare reports for the
Trust's Board of Trustees upon request showing such information concerning
expenditures related to this Agreement.
16. PRIVACY POLICY. The Distributor acknowledges and agrees that any
non-public personal information relating to customers of the Trust may be
provided to the Distributor solely for the purpose of enabling it to perform
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services pursuant to this Agreement and may not be re-used by the Distributor
for any other purpose. The Trust has provided the Distributor with a copy of the
Trust's privacy policy under Regulation S-P, 17 C.F.R. Part 240, and will
provide copies of annual and other notices under, or amendments to its privacy
policy. The Distributor agrees that non-public personal information will not be
released to any third parties except as permitted by both Regulation S-P and
policies of the Trust. The Distributor represents and warrants to the Trust that
it has adopted and implemented procedures to safeguard non-public personal
information relating to customer records and information, and that such
procedures are reasonably designed to: (i) insure the security and
confidentiality of customer records and information; (ii) protect against any
anticipated threats or hazards to the security or integrity of customer records
and information; and (iii) protect against unauthorized access to or use of
customer records or information.
17. DEFINITIONS. As used in this Agreement, the term(s):
(a) "assignment", "interested person", and "majority of the outstanding
voting securities" shall have the meaning given to them by Section 2(a) of the
1940 Act, subject to such exemptions as may be granted by the Securities and
Exchange Commission by any rule, regulation or order.
(b) "net assets" shall have the meaning ascribed to it in the Trust's
Declaration of Trust.
(c) "Prospectus" and "Statement of Additional Information" shall mean the
current form of Prospectus and Statement of Additional Information filed by the
Trust as part of the Registration Statement.
(d) "Registration Statement" shall mean the registration statement most
recently filed by the Trust with the Securities and Exchange Commission and
effective under the 1940 Act and 1933 Act, as such Registration Statement is
amended by any amendments thereto at the time in effect.
18. EFFECTIVE DATE AND RENEWAL OF AGREEMENT. This Agreement will become
effective with respect to the Trust on the date written above and, unless sooner
terminated as provided herein, will continue in effect for one year from the
date of its execution and from year to year thereafter, provided that such
continuance is specifically approved at least annually (a) by the Trust's Board
of Trustees or (b) by a vote of a majority of the outstanding voting securities
of the Trust, provided that in either event the continuance also is approved by
a majority of the Trust's Trustees who are not interested persons of the Trust
and who have no direct or indirect financial interest in the operation of the
Trust's Distribution Plans pursuant to Rule 12b-1 under the 1940 Act in this
Agreement or in any agreement related to the Trust's Distribution Plans
("Independent Trustees"), by vote cast in person at a meeting called for the
purpose of voting on such approval.
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19. ASSIGNMENT AND TERMINATION OF AGREEMENT. This Agreement shall
automatically terminate in the event of its assignment and may be terminated at
any time without the payment of any penalty by the Trust or by the Distributor
on 60 days' written notice to the other party. The Trust may effect such
termination by a vote of (i) a majority of the Trust's Board of Trustees, (ii) a
majority of the Independent Trustees, or (iii) a majority of the outstanding
voting securities of the Trust.
20. AMENDMENTS. This Agreement may be amended in writing by the parties
only if the terms of the amendment are either (a) approved by the Trust's Board
of Trustees or, (b) with respect to any given Series, by a vote of a majority of
the outstanding voting securities of that Series at a duly called meeting of the
shareholders. In either case, the majority of the Independent Trustees must
approve the amendment.
21. GOVERNING LAW. This Agreement shall be construed in accordance with
the laws of the State of Florida, without giving effect to the conflicts of laws
principles thereof, and in accordance with the 1940 Act, provided, however, that
to the extent that the applicable laws of the State of Florida conflict with the
applicable provisions of the 1940 Act, the latter shall control.
22. MASSACHUSETTS BUSINESS TRUST. Notice is hereby given that the
Distributor shall have no right to seek to proceed against or enforce this
Agreement against the individual shareholders of any Class or against the
Trustees or officers of any Class. Rather, the Distributor can seek to enforce
this Agreement only against the applicable Class itself.
23. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. 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.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below on this day and year first above
written.
Attest: HERITAGE CAPITAL APPRECIATION TRUST
By: By: /s/ X.X. Xxxxx
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Name: X.X. Xxxxx
Title: Executive Vice President and
Principal Executive Officer
Attest: XXXXXXX XXXXX & ASSOCIATES, INC.
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxx
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Xxxxxxx X. Xxxxxx Name: Xxxxx X. Xxxx
Title: Senior Vice President
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EXHIBIT A
HERITAGE CAPITAL APPRECIATION TRUST
The Heritage Capital Appreciation Trust consists of the Series and Classes
set forth below. Those Classes pay the Distributor, pursuant to Paragraph 5 of
this Agreement, the following service and/or distribution fees pursuant to the
Plans:
Percentage of Daily
Series/Classes Net Assets
Heritage Capital Appreciation Trust
Class A up to .50%*
Class B 1.00%
Class C 1.00%
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*Heritage Capital Appreciation Trust pays a Rule 12b-1 fee of .25% on all
sales after April 3, 1995 (the date the Trust's multiple class system was
implemented). The Trust continues to pay a Rule 12b-1 fee of .50% on amounts
representing shares sold prior to April 3. This will result in an overall
Rule 12b-1 fee of between .25% and .50%.
Date: August 27, 2001
