EXHIBIT 6.1
Distribution Agreement between DEVCAP Trust and CBIS Financial Services
DEVCAP TRUST
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxx 00000
November 25, 1997
CBIS Financial Services, Inc.
000 0xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
DISTRIBUTION AGREEMENT
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Dear Ladies and Gentlemen:
This is to confirm that, in consideration of the agreement hereinafter
contained, DEVCAP Trust (hereinafter called the "Trust"), a business trust
organized under the laws of the Commonwealth of Massachusetts and engaged in the
business of an open-end management investment company, has agreed that you shall
be, for the period of this agreement, the principal underwriter (as such term is
defined in Section 2(a)(29) of the Investment Company Act of 1940, as amended
(the "1940 Act")) and distributor of (a) shares of each series of the Trust set
forth on Schedule 1 hereto, as such Schedule may be revised from time to time
(each, a "Series") or (b) if no Series are set forth on such Schedule, shares of
the Trust. For the 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. Accordingly, the Trust hereby agrees with you as
follows:
I. REGISTRATION AND SALE OF ADDITIONAL SHARES
The Trust will from time to time use its best efforts to register under
the Securities Act of 1933, as amended (the "1933 Act") and the 1940
Act, such number of Shares not already so registered as you may
reasonably be expected to sell on behalf of the Trust. The Trust will
take such action as may be necessary from time to time to qualify
Shares so registered for sale by you or the Trust in any states
mutually agreeable to you and the Trust, and to maintain such
qualification. This Agreement relates to the issue and sale of Shares
that are duly authorized and registered and available for sale by the
Trust, including redeemed or repurchased Shares if and to the extent
that they may be legally sold and if, but only if, the Trust sees fit
to sell them.
II. SALE AND REPURCHASE OF SHARES
Subject to the provisions of paragraphs IV and VI hereof and to such
minimum purchase requirements as may from time to time be currently
indicated in the Trust's applicable prospectus or statement of
additional information, you are authorized to sell, as agent on behalf
of the Trust, Shares authorized for issue and registered under the 1933
Act. You may also purchase as principal Shares at net value for resale
to the public or qualified retail dealers with whom you may enter into
dealer agreements. Such sales will be made by you on behalf of the
Trust by accepting unconditional orders to purchase Shares placed with
you by Investors and such purchases will be made by you only after
acceptance by you of such orders. The sales price to the public of
Shares shall be the public offering price as defined in paragraph V
hereof. You shall receive and may retain all or any portion of the
sales load imposed on sales of Shares and not reallowed to dealers. You
are authorized to purchase Shares of the Trust presented to it by
dealers at the price determined in accordance with, and in the manner
set forth in, the Trust's applicable prospectus.
III. SOLICITATION OF ORDERS
(A) The Representatives will use their respective best efforts
(but only in states in which you may lawfully do so) to obtain
from investors unconditional orders for Shares authorized for
issue by the Trust and registered under the 1933 Act, provided
that you may in your discretion refuse to accept orders of
Shares from any particular applicant. "Representative" shall
mean any individual who is a registered representative of CBIS
Financial Services, Inc. whose primary responsibility is the
offer and sale of Shares of the Trust. The parties hereto
agree that as of the date hereof there shall be no more than
one Representative. During the term of this Agreement, the
number and identity of the Representatives shall be as
mutually agreed in writing from time to time by the parties
hereto.
(B) In consideration for the services to be rendered by the
Distributor under this Agreement, the Trust agrees to pay the
Distributor an annual fee of up to $10,000, such fee to be
payable quarterly in advance, no later than the first business
day of each calendar quarter during the term of this
Agreement. The specific amount of such fee shall be as agreed
from time to time by the parties hereto. Such fee shall be
prorated for any partial calendar quarter during the term of
the Agreement.
IV. SALE OF SHARES BY THE TRUST
Unless you are otherwise notified by the Trust, any right granted to
you to accept orders for Shares or to make sales on behalf of the Trust
or to purchase Shares for resale will not apply to (i) Shares issued in
connection with the merger or consolidation of any other
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investment company with the Trust or its acquisition, by purchase or
otherwise, of all or substantially all of the assets of any investment
company or substantially all the outstanding Shares of any such company
and (ii) Shares that may be offered by the Trust to shareholders of the
Trust by virtue of their being such shareholders.
V. PUBLIC OFFERING PRICE
All Shares sold to investors by you will be sold at the public offering
price. The public offering price for all accepted subscriptions will be
(i) the net asset value per Share, next determined, in the manner
provided in the Trust's registration statements as from time to time in
effect under the 1933 Act and the 1940 Act, after the order is accepted
by you plus (ii) the applicable sales charge, if any.
VI. SUSPENSION OF SALES
If and whenever the determination of net asset value is suspended and
until such suspension be terminated, no further order for Shares shall
be accepted by you except unconditional orders placed with you before
you had knowledge of the suspension. In addition, the Trust reserves
the right to suspend sales and your authority to accept orders for
Shares on behalf of the Trust if, in the judgment of a majority of the
Board of Trustees or a majority of the Executive Committee of such
Board, if such body exists, it is in the best interests of the Trust to
do so, such suspension to continue for such period as may be determined
by such majority; and in that event, no Shares will be sold by you on
behalf of the Trust while such suspension remains in effect except for
Shares necessary to cover unconditional orders accepted by you before
you had knowledge of the suspension.
VII. EXPENSES
A. The Trust will pay (or will enter into arrangements providing
that parties other than you will pay) all fees and expenses:
(1) in connection with the preparation, setting in type
and filing of any registration statement (including a
prospectus and statement of additional information)
under the 1933 Act or the 1940 Act, or both, and any
amendments or supplements thereto that may be made
from time to time;
(2) in connection with the registration and qualification
of Shares for sale in the various jurisdictions in
which the Trust shall determine it advisable to
qualify such Shares for sale (including registering
the Trust as a broker or dealer or any officer of the
Trust or other person as agent or salesman of the
Trust in any such jurisdictions);
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(3) of preparing, setting in type, printing and mailing
any notice, proxy statement, report, prospectus or
other communication to shareholders of the Trust in
their capacity as such or prepared for your use in
connection with the offering of shares to the public;
(4) of preparing, setting in type, printing and mailing
prospectuses annually, and any supplements thereto,
to existing shareholders;
(5) of preparing, setting in type, printing and mailing
any other literature used by you in connection with
the offering of Shares to the public;
(6) of advertising in connection with the offering of
Shares to the public;
(7) in connection with the issue and transfer of Shares
resulting from the acceptance by you of orders to
purchase Shares placed with you by investors,
including the expenses of printing and mailing
confirmations of such purchase orders and the
expenses of printing and mailing a prospectus
included with the confirmation of such orders;
(8) of any issue taxes or any initial transfer taxes;
(9) of WATS (or equivalent) telephone lines used by
investors or shareholders who request information
relating to the Trust;
(10) of wiring funds in payment of Share purchases or in
satisfaction of redemption or repurchase requests,
unless such expenses are paid for by the investor or
shareholder who initiates the transaction;
(11) of the cost of printing and postage of business reply
envelopes sent to Trust shareholders or prospective
investors;
(12) of one or more CRT terminals connected with the
computer facilities of the transfer agent;
(13) permitted to be paid or assumed by the Trust pursuant
to a plan (the "12b-1 Plan") (attached as Exhibit 1
hereto and incorporated by reference), adopted by the
Trust in conformity with the requirements of Rule
12b-1 under the 1940 Act ("Rule 12b-1") or any
successor rule, notwithstanding any other provision
to the contrary herein; and
(14) of the expense of setting in type, printing and
postage of the periodic newsletter to shareholders.
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The Trust will perform (or will enter into an arrangement
providing that parties other than you will perform) each of
the tasks set forth in this Section VII(A).
B. You shall pay or arrange for the payment of all fees and
expenses:
(1) incurred in connection with your registration as a
broker or dealer or the registration or qualification
of your officers, partners, trustees, agents or
representatives and the Representatives under Federal
and state laws; and
(2) the compensation paid to the Representatives.
The parties agree that initially and until mutually agreed in
writing by the parties hereto, there shall be no expenses that
shall be borne both by and allocated between CBIS Financial
Services and the Trust. Except as expressly set forth in
Section VII(B), none of the expenses incurred by the
Representatives in connection with the offer and sale of
Shares of the Trust shall be borne by you. Any expenses which
are to be allocated between you and the Trust shall be
allocated pursuant to reasonable procedures or formulae
mutually agreed upon from time to time, which procedures or
formulae shall to the extent practicable reflect studies of
relevant empirical data.
VIII. CONFORMITY WITH LAW
You agree that in selling Shares you will duly conform in all respects
with the laws of the United States and any state in which Shares may be
offered for sale by you pursuant to this Agreement and to the rules and
regulations of the National Association of Securities Dealers, Inc., of
which you are a member. The Trust shall afford the Distributor the
opportunity to review and approve advertising materials related to the
Trust prior to their use.
IX. INDEPENDENT CONTRACTOR
You shall be an independent contractor and neither you nor any of your
officers or employees is or shall be an employee of the Trust in the
performance of your duties hereunder. You shall be responsible for your
own conduct and the employment, control and conduct of your agents and
employees and for injury to such agents or employees or to others
through your agents or employees. You assume full responsibility for
your agents and employees under applicable statutes and agree to pay
all employee taxes thereunder provided however, that is it understood
and agreed that each Representative will be an independent contractor,
and not an employee of, CBIS Financial Services, Inc. "Representative"
shall mean any individual who is a registered representative of CBIS
Financial Services, Inc. whose primary responsibility is the offer and
sale of Shares of the Trust. The parties hereto agree that as of the
date hereof there shall be no more than one Representative. During the
term of this Agreement, the number and identity of the
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Representatives shall be as mutually agreed in writing from time to
time by the parties hereto.
X. INDEMNIFICATION
You agree to 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 1933 Act, against any and all
losses, claims, damages, liabilities or litigation (including
reasonable legal and other expenses) to which the Trust or such
Trustees, officers, or controlling persons may become subject under the
1933 Act, under any other statute, at common law or otherwise, arising
out of the acquisition of any Shares by any person which (i) may be
based upon any wrongful act by you or any of your employees or
representatives, or (ii) may be based upon any untrue statement or
alleged untrue statement of a material fact contained in a registration
statement (including a prospectus or statement of additional
information) covering Shares or any amendment thereof or supplement
thereto or the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statement
therein not misleading if such statement or omission was made in
reliance upon information furnished in writing to the Trust by you for
inclusion in such documents, or (iii) may be incurred or arise by
reason of your acting as the Trust's agent instead of purchasing and
reselling Shares as principal in distributing Shares to the public;
provided, however, that in no case (i) is your indemnity in favor of a
Trustee or officer or any other person deemed to protect such Trustee
or officer or other person against any liability to which any such
person would otherwise be subject by reason of wilful misfeasance, bad
faith, or gross negligence in the performance of his duties or by
reason of his reckless disregard of obligations and duties under this
Agreement or (ii) are you to be liable under your indemnity agreement
contained in this paragraph with respect to any claim made against the
Trust or any person indemnified unless the Trust or such person, as the
case may be, shall have notified you in writing within a reasonable
time after the summons or other first legal process giving information
of the nature of the claims shall have been served upon the Trust or
upon such person (or after the Trust or such person shall have received
notice of such service on any designated agent), but failure to notify
you of any such claim shall not relieve you from any liability which
you may have to the Trust or any person against whom such action is
brought otherwise than on account of your indemnity agreement contained
in this paragraph. You shall be entitled to participate, at your own
expense, in the defense, or, if you so elect, to assume the defense of
any suit brought to enforce any such liability, but if you elect to
assume the defense, such defense shall be conducted by counsel chosen
by you and satisfactory to the Trust, to its officers and Trustees, or
to any controlling person or persons, defendant or defendants in the
suit. In the event that you elect to assume the defense of any such
suit and retain such counsel, the Trust, such officers and Trustees or
controlling person or persons, defendant or defendants in the suit
shall bear the fees and expenses of any additional counsel retained by
them, but, in case you do not elect to assume the defense of any such
suit, you will reimburse the Trust, such officers and Trustees or
controlling person or persons,
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defendant or defendants in such suit for the reasonable fees and
expenses of any counsel retained by them. You agree promptly to notify
the Trust of the commencement of any litigation or proceedings against
it in connection with the issue and sale of any of Shares.
The Trust agrees to indemnify and hold harmless you and each of your
partners and officers and each person, if any, who controls you within
the meaning of Section 15 of the 1933 Act, against any and all losses,
claims, damages, liabilities or litigation (including reasonable legal
and other expenses) to which you or such partners, officers or
controlling person may become subject under the 1933 Act, under any
other statute, at common law or otherwise, arising out of the
acquisition of any Shares by any other statute, or common law or
otherwise, arising out of the acquisition of any Shares by any person
which (i) may be based upon any wrongful act by the Trust or any of its
employees or representatives, or the Representatives or (ii) may be
based upon any untrue statement or alleged untrue statement of a
material fact contained in a registration statement (including a
prospectus or statement of additional information) covering Shares or
any amendment thereof or supplement thereto or 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 if such
statement or omission was made in reliance upon information furnished
in writing to you by the Trust for inclusion in such documents;
provided, however, that in no case (i) is the Trust's indemnity in
favor of a partner or officer or any other person deemed to protect
such partner or officer or other person against any liability to which
any such person would otherwise be subject by reason of wilful
misfeasance, bad faith, or gross negligence in the performance of his
duties or by reason of his reckless disregard of obligations and duties
under this Agreement or (ii) is the Trust to be liable under its
indemnity agreement contained in this paragraph with respect to any
claims made against you or any such partner, officer or controlling
person unless you or such partner, officer or controlling person, as
the case may be, 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 you
or upon such partner, officer or controlling person (or after you or
such partner, officer or controlling person 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 person against whom such action is brought otherwise
than on account of its indemnity agreement contained in this paragraph.
The Trust will 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 liability, but if the Trust elects to assume the
defense, such defense shall be conducted by counsel chosen by it and
satisfactory to you, your partners, officers or controlling person or
persons, defendant or defendants in the suit. In the event that the
Trust elects to assume the defense of any such suit and retain such
counsel, you, your partners, officers or controlling person or persons,
defendant or defendants in the suit, shall bear the fees and expenses
of any additional counsel retained by them, but, in case the Trust does
not elect to assume the defense of any such suit, it will reimburse you
or such partners, officers or controlling person or persons, defendant
or defendants in the suit, for the reasonable
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fees and expenses of any counsel retained by them. The Trust agrees
promptly to notify you of the commencement of any litigation or
proceedings against it or any of its officers or Trustees in connection
with the issuance or sale of any Shares.
XI. AUTHORIZED REPRESENTATIONS
The Trust is not authorized to give any information or to make any
representations on behalf of you other than the information and
representations contained in a registration statement (including a
prospectus or statement of additional information) covering Shares, as
such registration statement and prospectus may be amended or
supplemented from time to time.
You are not authorized to give any information or to make any
representations on behalf of the Trust or in connection with the sale
of Shares other than the information and representations contained in a
registration statement (including a prospectus or statement of
additional information) covering Shares, as such registration statement
may be amended or supplemented from time to time. No person other than
you is authorized to act as principal underwriter (as such term is
defined in the 0000 Xxx) for the Trust.
XII. REPRESENTATIONS BY DISTRIBUTOR
You represent that you are a broker-dealer in good standing registered
with the Securities and Exchange Commission under Section 15 of the
Securities and Exchange Act of 1934, as amended (the "1934 Act") and
with all state securities commissioners in such states in which such
registration is required due to your duties under this Agreement. In
your capacity as distributor of the Shares, all activities by you and
your directors, officers, agents, and employees shall comply in all
material respects with all applicable laws, rules and regulations,
including without limitation, the 1940 Act, all rules and regulations
promulgated by the Securities and Exchange Commission thereunder and
all rules and regulations adopted by any securities association
registered under the 0000 Xxx.
You represent that you are a member in good standing of the National
Association of Securities Dealers, Inc. and will remain a member in
good standing for the duration of this agreement.
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XIII. DURATION AND TERMINATION OF THIS AGREEMENT
This Agreement shall remain in effect until November 25, 1998 and from
year to year thereafter, but only so long as such continuance is
specifically approved at least annually by the vote of a majority of
the Trustees who are not interested person of you or of the Trust and
have no direct or indirect financial interest in the operation of the
12b-1 Plan or in this or any other agreement related to the 12b-1 Plan
(the "12b-1 Trustees"), cast in person at a meeting called for the
purpose of voting on such approval, and by vote of the Board of
Trustees or of a majority of the outstanding voting securities of the
Trust. This Agreement may, on 60 days' written notice, be terminated at
any time without the payment of any penalty, by a majority of the 12b-1
Trustees, by a vote of a majority of the outstanding voting securities
of the Trust, or by you. This Agreement will automatically terminate in
the event of its assignment. In interpreting the provisions of this
paragraph XIII, the definitions contained in Section 2(a) of the 1940
Act (particularly the definitions of "interested person", "assignment"
and "majority of the outstanding voting securities"), as modified by
any applicable order of the Securities and Exchange Commission, shall
be applied.
XIV. AMENDMENT OF THE AGREEMENT
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 12b-1 Trustees.
If the Trust should at any time 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 the recommendations or requirements of the
Securities and Exchange Commission or other governmental authority or
to obtain any advantage under state or federal tax laws and should
notify you of the form of such amendment, and the reasons therefor, and
if you should decline to assent to such amendment, the Trust may
terminate this Agreement forthwith. If you should at any time request
that a change be made in the Trust's Agreement and Declaration of Trust
or By-laws or in its methods of doing business, in order to comply with
any requirements of federal law or regulations of the Securities and
Exchange Commission or of a national securities association of which
you are or may be a member relating to the sale of units or the Trust,
and the Trust should not make such necessary change within a reasonable
time, you may terminate this Agreement forthwith.
XV. GOVERNING LAW
This Agreement shall be governed and construed in accordance with the
laws of the State of Massachusetts.
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XVI. MISCELLANEOUS
You shall have no other duties in connection with the offer and sale of
the shares than those expressly set forth in this Agreement. The
captions in this Agreement are included for convenience of reference
only and in no way define or default any of the provisions hereof or
otherwise affect their construction or effect.
This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. The name
DEVCAP Trust is the designation of the Trustees for the time being
under an Agreement and Declaration of Trust dated September 15, 1995,
as amended from time to time, and all persons dealing with the Trust
must look solely to the property of the Trust for enforcement of any
claims against the Trust as neither the Trustees, officers, agents or
shareholders assume any personal liability for obligations entered into
on behalf of the Trust. No series of the Trust shall be liable for any
claims against any other series of the Trust.
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If you are in agreement with the foregoing, please sign the form of acceptance
in the accompanying counterpart of this letter and return such counterpart to
the Trust, whereupon this letter shall become a binding contract.
Very truly yours,
DEVCAP TRUST
By: /s/ Xxxxxx X. St. Clair
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Xxxxxx X. St. Clair
As Trustee pursuant to an Agreement and
Declaration of Trust on file with the
Secretary of The Commonwealth of
Massachusetts and not individually.
The foregoing Agreement is
hereby accepted as of the date
hereof.
CBIS FINANCIAL SERVICES, INC.
By: /s/ Brother Xxxxxxx X. X'Xxxx
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Brother Xxxxxxx X. X'Xxxx
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SCHEDULE 1
Name of Series
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DEVCAP Shared Return Fund
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EXHIBIT 1
Distribution and Service Plan
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