EXHIBIT (e)(1)
DISTRIBUTION AGREEMENT
TD WATERHOUSE TRUST
000 XXXX XXXXXX
XXX XXXX, XX 00000
April 11, 2001
Funds Distributor, Inc.
00 Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Dear Sirs:
This is to confirm that, in consideration of the agreements hereinafter
contained, the above-named investment company (the "Trust") has agreed that you
shall be, for the period of this agreement, the distributor of (a) shares of
each Series of the Trust set forth on Exhibit A hereto, as such Exhibit may be
revised from time to time (each, a "Series") or (b) if no Series are set forth
on such Exhibit, shares of the Trust. For purposes of this agreement, the term
"Shares" shall mean the authorized shares of the relevant Series, if any, and
otherwise shall mean the Trust's authorized shares.
0.Xxxxxxxx as Distributor
1.1 You will act as agent for the distribution of Shares covered by,
and in accordance with, the registration statement and prospectus of the Trust
then in effect under the Securities Act of 1933, as amended, and will transmit
promptly, any orders received by you for purchase or redemption of Shares to the
Transfer and Dividend Disbursing Agent for the Trust of which the Trust has
notified you in writing.
1.2 You agree to use your best efforts to solicit orders for the sale
of Shares in accordance with the terms and conditions of the aforementioned
prospectus. It is contemplated that 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, and in so doing you will act only on your own behalf as principal.
1.3 You shall act as distributor of Shares in compliance with all
applicable laws, rules and regulations, including, without limitation, 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.
1.4 Whenever in their judgment such action is warranted by unusual
market, economic or political conditions, or by abnormal circumstances of any
kind deemed by the parties hereto to render sales of a Trust's Shares not in the
best interest of the Trust, the parties hereto may decline to accept any orders
for, or make any sales of, any Shares until such time as those parties deem it
advisable to accept such orders and to make such sales; and each party shall
advise promptly the other party of any such determination.
1.5 The Trust agrees to pay all costs and expenses in connection with
the registration of Shares under the Securities Act of 1933, as amended, and all
expenses in connection with maintaining facilities for the issue and transfer of
Shares and for supplying information, prices and other data to be furnished by
the Trust hereunder, and all expenses in connection with the preparation and
printing of the Trust's prospectuses and statements of additional information
for regulatory purposes and for distribution to shareholders; provided however,
that the Trust shall not pay any of the costs of advertising or promotion for
the sale of Shares.
1.6 The Trust agrees to execute any and all documents and to furnish
any and all information and otherwise use its best efforts to take all actions
that 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 you may
designate to the Trust and the Trust may approve, and the Trust agrees to pay
all expenses that may be incurred in connection with such qualification;
provided, however that the Trust shall not be required to qualify to do business
as a foreign corporation in any jurisdiction. 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 as contemplated
in this agreement.
1.7 The Trust shall furnish you from time to time, for use in
connection with the sale of Shares, such information with respect to the Trust
or any relevant Series and the Shares as you may reasonably request, all of
which shall be signed by one or more of the Trust's duly authorized officers;
and the Trust warrants that the statements contained in any such information,
when so signed by the Trust's officers, shall be true and correct. The Trust
also shall furnish you upon request with: (a) semi-annual reports and annual
audited reports of the Trust's books and accounts made by independent public
accountants regularly retained by the Trust, (b) quarterly earnings statements
prepared by the Trust, (c) a monthly itemized list of the securities in the
Trust's or, if applicable, each 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 Trust's financial condition as you may
reasonably request.
1.8 From time to time, each party shall be permitted reasonable access
to records maintained by the other party in connection with this Agreement to
the extent necessary to perform its obligations hereunder; provided, however,
that to the extent a party provides records containing information relating to a
customer of that party, the party receiving such records shall use the
information contained in such records solely for the purpose of fulfilling its
obligations under this Agreement and applicable law and for no other purpose.
1.9 The Trust represents to you that all registration statements and
prospectuses filed by the Trust with the Securities and Exchange Commission
under the Securities Act of 1933, as amended, and under the 1940 Act, as
amended, with respect to the Shares have been carefully prepared in conformity
with the then-current 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 that at any time shall
have been filed with said Commission. The Trust 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, in the light of the
circumstances under which they were made, not misleading. The Trust may, but
shall not be obligated to, propose from time to time such amendment or
amendments to any registration statement and such supplement or supplements to
any prospectus as, in the light of future developments, may, in the opinion of
the Trust's counsel, be necessary or advisable. If the Trust shall not propose
such amendment or amendments and/or supplement or supplements within fifteen
days after receipt by the Trust of a written request from you to do so, you may,
at your option, terminate this agreement or decline to make offers of the
Trust's securities until such amendments are made. The Trust shall not file any
amendment to any registration statement or supplement to any prospectus without
giving you reasonable notice thereof in advance; provided, however, that nothing
contained in this agreement shall in any way limit the Trust's right to file at
any time such amendments to any registration statement and/or supplements to any
prospectus, of whatever character, as the Trust may deem advisable, such right
being in all respects absolute and unconditional.
1.10 The Trust authorizes you and any dealers with whom you have
entered into dealer agreements to use any prospectus in the then-current form
furnished by the Trust in connection with the sale of Shares. The Trust 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 Securities Act
of 1933, as amended, 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 you, your officers and directors, or any such
controlling persons, may incur under the Securities Act of 1933, as amended, the
1940 Act, as amended, or common law or otherwise, 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 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, in the light of
the circumstances under which they were made, not misleading, except that the
Trust'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 Trust or its representatives for
use in the preparation thereof, and except that the Trust's agreement to
indemnify you and the Trust's representations and warranties set out in
paragraph 1.9 of this Agreement will not be deemed to cover any liability to the
Trust or its 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 Trust's agreement to
indemnify you, your officers and directors, and any such controlling person, as
aforesaid, is expressly conditioned upon the Trust 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 Trust 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 Trust of any such action shall not relieve the Trust
from any liability that the Trust 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, (i) except to the extent the Trust's ability to
defend such action has been materially adversely affected by such failure, or
(ii) otherwise than on account of the Trust's indemnity agreement contained in
this paragraph 1.10. The Trust 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 Trust
and approved by you. In the event the Trust 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 Trust does not elect to assume
the defense of any such suit, the Trust will reimburse you, your officers and
directors, or the controlling person or persons named as defendant or defendants
in such suit, for the fees and expenses of any counsel retained by you or them,
subject to the right of the Trust to assume the defense of such suit with
counsel of good standing at any time prior to the settlement or final
determination thereof. The Trust' s indemnification agreement contained in this
paragraph 1.10 and the Trust'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 and their successors. The Trust agrees promptly to
notify you of the commencement of any litigation or proceedings against the
Trust or any of its officers or Board members in connection with the issue and
sale of Shares.
1.11 You agree to indemnify, defend and hold the Trust, its several
officers and Board members, and any person who controls the Trust within the
meaning of Section 15 of the Securities Act of 1933, as amended, 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
Trust, its officers or Board members, or any such controlling person, may incur
under the Securities Act of 1933, as amended, the 1940 Act, as amended, or under
common law or otherwise, but only to the extent that such liability or expense
incurred by the Trust, 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 unauthorized sales literature, advertisements, information, statements or
representations or any Disqualifying Conduct in connection with the offering and
sale of any Shares, or (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 Trust specifically for use in the Trust'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 Trust and required to be stated
in such answers or necessary to make such information, in the light of the
circumstances under which it was made, not misleading. Your agreement to
indemnify the Trust, 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 Trust, 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. You shall have the right to control the defense of such action, with
counsel of your own choosing, satisfactory to the Trust, if such action is based
solely upon such alleged misstatement or omission on your part, and in any other
event the Trust, 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. The failure so to notify you of any such action shall not
relieve you from any liability that you may have to the Trust, 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, (i) except to the
extent your ability to defend such action has been materially adversely affected
by such failure, or (ii) otherwise than on account of your indemnity agreement
contained in this paragraph 1.11. This agreement of indemnity will inure
exclusively to the Trust's benefit, to the benefit of the Trust' 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 Trust
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.
1.12 No Shares shall be offered by either you or the Trust 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 Trust 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
Securities Act of 1933, as amended, or if and so long as a current prospectus as
required by Section 10 of said Act, as amended, is not on file with the
Securities and Exchange Commission provided, however, that nothing contained in
this paragraph 1.12 shall in any way restrict or have an application to or
bearing upon the Trust's obligation to repurchase any Shares from any
shareholder in accordance with the provisions of the Trust's prospectus or
charter documents.
1.13 The Trust agrees to advise you immediately in writing:
(a) of any request by the Securities and Exchange Commission for
amendments to the registration statement or prospectus then in effect
or for additional information;
(b) in 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) of the happening of any, event that in the judgment of the
Trust's Board of Trustees makes untrue any statement of a material
fact made in the registration statement or prospectus then in effect
or that requires the making of a change in such registration statement
or prospectus in order to make the statements therein not misleading
in any material respect; and
(d) of all declarations of effectiveness and other actions of the
Securities and Exchange Commission with respect to any amendments to
the registration statement or prospectus that may from time to time be
filed with the Securities and Exchange Commission.
2. Offering Price
Shares of any class or series of the Trust offered for sale by you
shall be offered at a price per share (the "offering price") equal to (a) the
net asset value (determined in the manner set forth in the Trust's charter
documents) plus (b) a sales charge, if any, and except to those persons set
forth in the then-current prospectus, which shall be the percentage of the
offering price of such Shares as set forth in the Trust's then-current
prospectus. The offering price, if not an exact multiple of one cent, shall be
adjusted to the nearest cent. In addition, Shares of any class of the Trust
offered for sale by you may be subject to a contingent deferred sales charge, to
the extent set forth in the Trust's then-current prospectus. You shall be
entitled to receive any sales charge or contingent deferred sales charge in
respect of the Shares. Any payments to dealers shall be governed by a separate
agreement between you and such dealer and the Trust's then-current prospectus.
3. Term
This Agreement shall become effective with respect to the Trust as of the
date hereof and will continue for an initial two-year term and will continue
thereafter so long as such continuance is specifically approved at least
annually (i) by the Trust's Board or (ii) by a vote of a majority (as defined in
the 0000 Xxx) of the Shares of the Trust or the relevant 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 said Act)
of any party to this Agreement and who have no direct or indirect financial
interest in this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This agreement is terminable with respect to
any Series or any Trust, without penalty, on not less than sixty days notice, by
the Trust's Board of Trustees, by vote of a majority (as defined in the 0000
Xxx) of the outstanding voting securities of such Trust, or by you. This
Agreement shall terminate automatically in the event of its "assignment" (as
defined in the 1940 Act).
4. Miscellaneous
4.1 The Trust 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 internal laws of the State
of New York without giving effect 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.
4.5 Funds Distributor, Inc. ("FDI") represents and warrants that it is
a member of the National Association of Securities Dealers ("NASD") and agrees
to abide by all of the rules and regulations of the NASD, including, without
limitation, its Conduct Rules. FDI agrees to comply with all applicable federal
and state laws, rules and regulations. FDI agrees to notify the Trust
immediately in the event of its expulsion or suspension by the NASD. Expulsion
of FDI by the NASD will automatically terminate this Agreement immediately
without notice. Suspension of FDI by the NASD will terminate this Agreement
effective immediately upon written notice of termination to FDI from the Trust.
4.6 All notices or other communications hereunder to either par-party
shall be in writing and shall be deemed sufficient if mailed to such party at
the address of such party set forth on page 1 of this Agreement or at such other
address as such party may be designated by written notice to the other, or by
telex, telecopier, telegram or similar means of same day delivery (with a
confirming copy by mail as provided herein).
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,
TD WATERHOUSE TRUST
By: /s/ Xxxxxx X. Rio
-------------------------
President
Accepted:
FUNDS DISTRIBUTOR, INC.
By: /s/ Xxxxxxxxxxx X. Xxxxxx
-------------------------------
Senior Vice President
EXHIBIT A
Series of Funds
TD WATERHOUSE TRUST
XX Xxxxxxxxxx Xxxx Index Fund
XX Xxxxxxxxxx Xxx 30 Fund
TD Waterhouse 500 Index Fund
TD Waterhouse Extended Market Index Fund
TD Waterhouse Asian Index Fund
TD Waterhouse European Index Fund
TD Waterhouse Technology Fund
TD Waterhouse Tax Managed Growth Fund
