DISTRIBUTION AGREEMENT CLASS A SHARES
Exhibit e(4)
CLASS A SHARES
DISTRIBUTION AGREEMENT, dated as of November 28, 2008, by and between DOMINI SOCIAL INVESTMENT
TRUST, a Massachusetts business trust (the “Trust”), and DSIL INVESTMENT SERVICES LLC, a New York
limited liability company and a subsidiary of Domini Social Investments LLC (the “Distributor”).
W I T N E S S E T H:
WHEREAS, the Trust is engaged in business as an open-end investment company registered under
the Investment Company Act of 1940 (collectively with the rules and regulations promulgated
thereunder, the “1940 Act”) and consists of one or more series;
WHEREAS, the Trust desires to enter into this Distribution Agreement with respect to the
shares designated Class A Shares for each of its current and future series; and
WHEREAS, the Trust wishes to engage the Distributor to provide certain services with respect
the distribution of Class A Shares of each series of the Trust, and the Distributor is willing to
provide such services to each series of the Trust on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements of the parties hereto
as herein set forth, the parties covenant and agree as follows:
1. The Trust grants to the Distributor the right, as agent of the Trust, to sell its shares of
beneficial interest designated Class A Shares (“Shares”) of each series of the Trust upon the terms
hereinbelow set forth during the term of this Agreement. While this Agreement is in force, the
Distributor agrees to use its best efforts to find purchasers for Shares of each series of the
Trust.
The Distributor shall have the right, as agent of the Trust, to order from the Trust the
Shares needed, but not more than the Shares needed (except for clerical errors and errors
transmission), to fill unconditional orders for Shares placed with the Distributor, all such orders
to be made in the manner set forth in the Trust’s then-current prospectus (the “Prospectus”) and
then-current statement of additional information (the “Statement of Additional Information”). The
price which shall be paid to the Trust for the Shares so purchased shall be the net asset value per
Share as determined in accordance with the provisions of the Declaration of Trust and the By-Laws,
as each may from time to time be amended (collectively, the “Governing Instruments”). The
Distributor shall notify the Custodian of the Trust (currently Investors Bank & Trust Company), at
the end of each business day, or as soon thereafter as the orders placed with the Distributor have
been compiled, of the number of Shares and the prices thereof which have been ordered through the
Distributor since the end of the previous business day.
The right granted to the Distributor to place orders for Shares with the Trust shall be
exclusive, except that this exclusive right shall not apply to Shares issued in the event
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that an investment company (whether a regulated or private investment company or a personal
holding company) is merged with and into or consolidated with the Trust or in the event that the
Trust acquires, by purchase or otherwise, all (or substantially all) the assets or the outstanding
shares of any such company; nor shall it apply to Shares issued by the Trust as a dividend or stock
split. The exclusive right to place orders for Shares granted to the Distributor may be waived by
the Distributor by notice to the Trust in writing, either unconditionally or subject to such
conditions and limitations as may be set forth in such notice to the Trust. The Trust hereby
acknowledges that the Distributor may render distribution and other services to other parties,
including other investment companies. In connection with its duties hereunder, the Distributor
shall also arrange for computation of performance statistics with respect to the Trust and arrange
for publication of current price information in newspapers and other publications.
2. The Shares may be sold by the Distributor on behalf of the Trust, to any investor or to or
through any dealer having a sales agreement with the Distributor, upon the following terms and
conditions:
The public offering price of Shares of the Trust, i.e., the price per Share at which the
Distributor or any dealer purchasing Shares through the Distributor may sell shares to the public,
shall be the net asset value of such Shares.
The net asset value of Shares of the Trust shall be determined by the Trust, or by an agent of
the Trust, as of the close of regular trading on the New York Stock Exchange on each day on which
the New York Stock Exchange is open for trading (and on such other days as the Trustees deem
necessary in order to comply with Rule 22c-1 under the 1940 Act), in accordance with the method
established pursuant to the Governing Instruments. The Trust shall have the right to suspend the
sale of Shares if, because of some extraordinary condition, the New York Stock Exchange shall be
closed, or if conditions existing during the hours when the Exchange is open render such action
advisable or for any other reason deemed adequate by the Trust.
3. The Trust agrees that it will, from time to time, but subject to the necessary approval, if
any, of its shareholders, take all necessary action to register such number of Shares under the
Securities Act of 1933, as amended (the “1933 Act”), as the Distributor may reasonably be expected
to sell.
The Distributor shall be an independent contractor and neither the Distributor nor any of its
managers, officers or employees as such, is or shall be an employee of the Trust. It is understood
that Trustees, officers and shareholders of the Trust are or may become interested in the
Distributor, as managers, officers, employees, or otherwise and that managers, officers and
employees of the Distributor are or may become similarly interested in the Trust and that the
Distributor may be or become interested in the Trust as a shareholder or otherwise. The Distributor
is responsible for its own conduct and the employment, control and conduct (but only with respect
to the duties and obligations of the Distributor hereunder) of its agents and employees and for any
injury to any person through its agents or employees. The Distributor assumes full responsibility
for its agents and employees under applicable statutes and agrees to pay all employer taxes
thereunder.
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4. The Distributor covenants and agrees that, in selling Shares, it will use its best efforts
in all respects duly to conform with the requirements of all state and federal laws and the Conduct
Rules of the NASD, Inc. relating to the sale of Shares, and will indemnify and hold harmless the
Trust and each of its Trustees and officers and each person, if any, who controls the Trust within
the meaning of Section 15 of the Act (the “Indemnified Parties”) against all losses, liabilities,
damages, claims or expenses (including the reasonable cost of investigating or defending any
alleged loss, liability, damages, claim or expense and reasonable counsel fees incurred in
connection therewith) arising from any claim, demand, action or suit (collectively, “Claims”),
arising by reason of any person’s acquiring any of the Shares through the Distributor, which may be
based upon the 1933 Act or any other statute or common law, on account of any wrongful act of the
Distributor or any of its employees (including any failure to conform with any requirement of any
state or federal law or the Conduct Rules of the NASD, Inc. relating to the sale of Shares) or on
the ground that the registration statement under the 1933 Act, including all amendments thereto
(the “Registration Statement”), or Prospectus or previous prospectus or Statement of Additional
Information or previous statement of additional information, with respect to such Shares, includes
or included an untrue statement of a material fact or omits or omitted to state a material fact
required to be stated therein or necessary in order to make the statements therein not misleading,
if and only if any such act, statement or omission was made in reliance upon information furnished
by the Distributor to the Trust; provided, however, that in no case (i) is the indemnity of the
Distributor in favor of any Indemnified Party to be deemed to protect any such Indemnified Party
against liability to which such Indemnified Party would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of its or his duties or by reason of
its or his reckless disregard of its or his obligations and duties under this Agreement, or (ii) is
the Distributor to be liable under its indemnity agreement contained in this Section 4 with respect
to any Claim made against any Indemnified Party unless such Indemnified Party shall have notified
the Distributor in writing within a reasonable time after the summons or other first legal process
giving information of the nature of the Claim shall have been served upon such Indemnified Party
(or after such Indemnified Party shall have received notice of such service on any designated
agent), but failure to notify the Distributor of any such Claim shall not relieve it from any
liability which it may have to any Indemnified Party otherwise than on account of its indemnity
agreement contained in this Section 4. The Distributor shall be entitled to participate, at its
own expense, in the defense, or, if it so elects, to assume the defense, of any suit brought to
enforce any such Claim, and, if the Distributor elects to assume the defense, such defense shall be
conducted by counsel chosen by it and satisfactory to each Indemnified Party. In the event that
the Distributor elects to assume the defense of any such suit and retain such counsel, each
Indemnified Party shall bear the fees and expenses of any additional counsel retained by it but, in
case the Distributor does not elect to assume the defense of any such suit, it shall reimburse the
Indemnified Parties for the reasonable fees and expenses of any counsel retained by them. Except
with the prior written consent of the Distributor, no Indemnified Party shall confess any Claim or
make any compromise in any case in which the Distributor will be asked to indemnify such
Indemnified Party. The Distributor agrees promptly to notify the Trust of the commencement of any
litigation or proceeding against it in connection with the issuance and sale of any of the Shares.
Neither the Distributor nor any dealer nor any other person is authorized to give any
information or to make any representation on behalf of the Trust in connection with the
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sale of Shares, other than those contained in the Registration Statement or Prospectus or
Statement of Additional Information.
The Trust covenants and agrees that it will indemnify and hold harmless the Distributor, its
managers and officers and each person, if any, who controls the Distributor within the meaning of
Section 15 of the Act against all losses, liabilities, damages, claims or expenses (including the
reasonable cost of investigating or defending any alleged loss, liabilities, damages, claims or
expenses and reasonable counsel fees incurred in connection therewith) arising from any Claims, (i)
arising by reason of any person’s acquiring any of the Shares through the Distributor, which may be
based upon the 1933 Act or any other statute or common law, on account that the Registration
Statement or Prospectus or previous prospectus or Statement of Additional Information or previous
statement of additional information, with respect to such Shares, includes or included an untrue
statement of a material fact or omits or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading, except insofar as such
act, statement or omission was made in reliance upon information furnished by the Distributor to
the Trust for use in the Registration Statement or Prospectus or (ii) arising by reason of any
agreement of the Distributor to indemnify or hold harmless any dealer having a sales agreement with
the Distributor as provided in Section 2; provided, however, that in no case (A) shall anything
contained herein be so construed as to protect the Distributor against any liability to the Trust
or to 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 under this Agreement, or (B) is the Trust to be liable under
its indemnity agreement contained in this Section 4 with respect to any Claim made against the
Distributor unless it shall have notified the Trust in writing within a reasonable time after the
summons or other first legal process giving information of the nature of the Claim shall have been
served upon it (or after the Distributor shall have received notice of such service on any
designated agent), but failure to notify the Trust of any such Claim shall not relieve it from any
liability which it may have to the Distributor otherwise than on account of its indemnity agreement
contained in this Section 4. The Trust shall be entitled to participate, at its own expense, in
the defense, or, if it so elects, to assume the defense, of any suit brought to enforce any such
Claim, and, if the Trust elects to assume the defense, such defense shall be conducted by counsel
chosen by it and satisfactory to the Distributor. In the event that the Trust elects to assume the
defense of any such suit and retain such counsel, the Distributor shall bear the fees and expenses
of any additional counsel retained by it but, in case the Trust does not elect to assume the
defense of any such suit, it shall reimburse the Distributor for the reasonable fees and expenses
of any counsel retained by them. Except with the prior written consent of the Trust, the
Distributor shall not confess any Claim or make any compromise in any case in which the Trust will
be asked to indemnify it. The Trust agrees promptly to notify the Distributor of the commencement
of any litigation in connection with the issuance and sale of any of the Shares.
5. (a) The Trust will pay, or cause to be paid: (i) all costs and expenses of the Trust,
including fees and disbursements of its counsel, in connection with the preparation and filing of
the Registration Statement, Prospectus and Statement of Additional Information, and preparing,
printing, reproducing and mailing to shareholders, Prospectuses, Statements of Additional
Information, statements and confirmations and periodic reports (including the expense of setting in
type the Registration Statement,
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Prospectus and Statement of Additional Information or any periodic report); (ii) the cost of
preparing temporary or permanent certificates for Shares; (iii) the cost and expenses of delivering
to the Distributor all Shares purchased through it as agent hereunder (iv) all fees and
disbursements of the Trust’s transfer agent and custodian; and (v) a fee to the manager or sponsor
of the Trust or any series thereof. The Distributor shall receive no compensation for its services
to the Trust hereunder.
(b) In addition and subject to the Distribution Plan, the Trust shall pay, or shall reimburse the
Distributor for any payment by the Distributor on behalf of the Trust of, expenses incurred in
connection with the sale of Shares of each Series of the Trust, including, without limitation,
payments to broker-dealers, banks, investment advisers and other intermediaries who advise
shareholders regarding the purchase or sale or retention of Shares of the Trust, compensation of
employees and related overhead of the Distributor, advertising, marketing and research expenses and
the expenses of printing (excluding typesetting) and distributing prospectuses and reports used for
sales purposes, expenses of preparing and printing sales literature and other distribution-related
expenses, provided that the amounts so paid or reimbursed by the Trust in connection with the sale
of Shares of any Series of the Trust shall not to exceed 0.25% of the average daily net assets of
the Shares of that Series for that Series’ then-current fiscal year. The Trust hereby authorizes
the Distributor to incur expenses on behalf of the Trust as described in this paragraph (b). The
Trust acknowledges and agrees that all such expenses incurred by the Distributor are obligations of
the Trust only and that the Distributor shall have no liability in respect thereof.
(c) Subject to the Distribution Plan, the Trust shall also pay to the Distributor a
distribution fee with respect to each Series of the Trust at an annual rate which, when added to
the amount paid or reimbursed by the Trust for expenses with respect to that Series under paragraph
(b) above, will equal 0.25% of the average daily net assets of the Shares of that Series for that
Series’ then-current fiscal year, as compensation for distribution services provided by the
Distributor in connection with the sale of Shares of that Series.
6. If, at any time during the term of this Agreement, the Trust shall deem it necessary or
advisable in the best interests of the Trust that any amendment of this Agreement be made in order
to comply with any recommendation or requirement of the Securities and Exchange Commission or other
governmental authority or to obtain any advantage under Massachusetts or federal tax laws, it shall
notify the Distributor of the form of amendment which it deems necessary or advisable and the
reasons therefor. If the Distributor declines to assent to such amendment (after a reasonable
time), the Trust may terminate this Agreement forthwith by written notice to the Distributor
without payment of any penalty. If, at any time during the term of this Agreement, the Distributor
requests the Trust to make any change in its Governing Instruments or in its methods of doing
business which are necessary in order to comply with any requirement of federal law or regulations
of the Securities and Exchange Commission or of a national securities association of which the
Distributor is or may become a member, relating to the sale of Shares, and the Trust fails (after a
reasonable time) to make any such change as requested, the Distributor may terminate this Agreement
forthwith by written notice to the Trust without payment of any penalty.
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7. The Distributor agrees that it will not take any long or short position in the Shares of
the Trust and that, so far as it can control the situation, it will prevent any of its managers or
officers from taking any long or short position in the Shares of the Trust, except as permitted by
the Governing Instruments.
8. This Agreement shall become effective upon its execution and shall continue in force
indefinitely as to each series of the Trust, provided that such continuance is “specifically
approved at least annually” with respect to the applicable series by the vote of a majority of the
Trustees of the Trust who are not “interested persons” of the Trust or of the Distributor at a
meeting specifically called for the purpose of voting on such approval, and by the Board of
Trustees of the Trust. The aforesaid requirement that continuance of this Agreement be
“specifically approved at least annually” shall be construed in a manner consistent with the 1940
Act. If such annual approval is not obtained, this Agreement shall terminate on the date which is
15 months after the date of the last approval. This Agreement may be terminated with respect to
any series of the Trust at any time by (i) the Trust, (a) by a vote of a majority of the Trustees
of the Trust who are not “interested persons” of the Trust or the Distributor, (b) by a vote of the
Board of Trustees of the Trust, or (c) by a “vote of a majority of the outstanding voting
securities” of the Shares of the applicable series of the Trust, or (ii) by the Distributor, in any
case without payment of any penalty on not more than 60 days’ nor less than 30 days’ written notice
to the other party. This Agreement shall automatically terminate in the event of its assignment.
9. The terms “vote of a majority of the outstanding voting securities”, “interested person”,
“assignment” and “specifically approved at least annually” shall have the respective meanings
specified in, and shall be construed in a manner consistent with, the 1940 Act, subject, however,
to such exemptions as may be granted by the Securities and Exchange Commission thereunder.
[Signature page follows.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered
in their names on their behalf by the undersigned, thereunto duly authorized, and their respective
seals to be hereto affixed, all as of the day and year first above written. The obligations of this
Agreement are not binding upon any of the Trustees or shareholders of the Trust individually, but
bind only the Trust estate. The obligations of a particular series of the Trust shall be paid only
from the assets of that series and shall not be enforceable against any other series.
| DOMINI SOCIAL INVESTMENT TRUST | ||||||
| By: | /s/ Xxx Xxxxxx
|
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| Title: Chief Executive Officer | ||||||
| DSIL INVESTMENT SERVICES LLC | ||||||
| By: | /s/ X.X. Xxxxxx
|
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| Title: President | ||||||
