DELAWARE GROUP PREMIUM FUND, INC.
REIT SERIES
DISTRIBUTION AGREEMENT
Distribution Agreement made as of this 30th day of April, 1998 by and
between DELAWARE GROUP PREMIUM FUND, INC., a Maryland corporation (the "Fund"),
on behalf of its REIT SERIES (the "Series") and DELAWARE DISTRIBUTORS, L.P. (the
"Distributor"), a Delaware limited partnership.
W I T N E S S E T H:
WHEREAS, the Fund is an investment company regulated by Federal and
State regulatory bodies, and
WHEREAS, the Distributor is engaged in the business of promoting the
distribution of the securities of investment companies and, in connection
therewith and acting solely as agent for such investment companies and not as
principal, advertising, promoting, offering and selling their securities to the
public, and
WHEREAS, the Fund desires to appoint the Distributor as distributor for
the shares of the Series and the Distributor wishes to accept such appointment
on the terms and conditions set forth below.
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. The Fund hereby engages the Distributor to promote the distribution
of the Series' shares and, in connection therewith and as agent for
the Fund and not as principal, to advertise, promote, offer and sell
the Series' shares to the public.
2. The Distributor agrees to serve as distributor of the Series' shares
and, as agent for the Fund and not as principal, to advertise,
promote and use its best efforts to sell the Series' shares wherever
their sale is legal, either through dealers or otherwise, in such
places and
in such manner, not inconsistent with the law and the provisions of
this Agreement and the Fund's Registration Statement under the
Securities Act of 1933 including the Prospectus contained therein
and the Statement of Additional Information contained therein, as
may be mutually determined by the Fund and the Distributor from time
to time. The Distributor will bear all costs of financing any
activity which is primarily intended to result in the sale of the
Series' shares, including, but not necessarily limited to,
advertising, compensation of underwriters, dealers and sales
personnel, the printing and mailing of sales literature and
distribution of the Series' shares.
3. (a) The Fund agrees to make available for sale by the Fund through
the Distributor all or such part of the authorized but unissued
Series' shares as the Distributor shall require from time to
time, all subject to the further provisions of this contract,
and except with the Distributor's written consent or as provided
in Paragraph 3(b) hereof, the Fund will not sell Series shares
other than through the efforts of the Distributor.
(b) The Fund reserves the right from time to time (l) to sell and
issue shares other than for cash; (2) to issue shares in
exchange for substantially all of the assets of any corporation
or trust, or in exchange for shares of any corporation or trust;
(3) to pay stock dividends to its shareholder, or to pay
dividends in cash or stock at the option of its stockholders, or
to sell stock to existing stockholders to the extent of
dividends payable from time to time in cash, or to split up or
combine its outstanding shares of Common Stock; (4) to offer
shares for cash to its stockholders as a whole, by the use of
transferable rights or otherwise, and to sell
-2-
and issue shares pursuant to such offers; and (5) to act as its
own distributor in any jurisdiction where the Distributor is not
registered as a broker dealer.
4. The Fund warrants the following:
(a) The Fund is, or will be, a properly registered
investment company, and any and all shares which it
will sell through the Distributor are, or will be,
properly registered with the Securities and Exchange
Commission.
(b) The provisions of this contract do not violate the
terms of any instrument by which the Fund is bound,
nor do they violate any law or regulation of any body
having jurisdiction over the Fund or its property.
5. (a) The Fund will supply to the Distributor a conformed
copy of the Registration Statement, all amendments
thereto, all exhibits, and each Prospectus and
Statement of Additional Information.
(b) The Fund will register or qualify the Series' shares
for sale in such states as is deemed desirable.
(c) The Fund, without expense to the Distributor:
(1) will give and continue to give such
financial statements and other information
as may be required by the SEC or the proper
public bodies of the states in which the
shares may be qualified;
(2) from time to time, will furnish the
Distributor as soon as reasonably
practicable the following information: (a)
true copies of its periodic reports to
stockholders, and unaudited quarterly
balance sheets and income statements for the
period from the beginning of the then
current fiscal year to such balance sheet
dates; and (b) a profit and loss statement
and a balance sheet at the end of each
fiscal half year accompanied by a copy of
the certificate or report thereon of an
independent public accountant (who may be
the regular accountant for the Fund),
provided that in lieu of furnishing at the
end of any fiscal half year a statement of
profit and loss and a balance sheet
certified by an independent public
-3-
accountant as above required, the Fund may
furnish a true copy of its detailed
semi-annual report to its stockholders;
(3) will promptly advise the Distributor in
person or by telephone or telegraph, and
promptly confirm such advice in writing, (a)
when any amendment or supplement to the
Registration Statement becomes effective,
(b)of any request by the SEC for amendments
or supplements to the Registration Statement
or the Prospectus or for additional
information, and (c) of the issuance by the
SEC of any Stop Order suspending the
effectiveness of the Registration Statement,
or the initiation of any proceedings for
that purpose;
(4) if at any time the SEC shall issue any Stop
Order suspending the effectiveness of the
Registration Statement, will make every
reasonable effort to obtain the lifting of
such order at the earliest possible moment;
(5) will from time to time, use its best effort
to keep a sufficient supply of shares
authorized, any increases being subject to
approval of the Fund's shareholders as may
be required;
(6) before filing any further amendment to the
Registration Statement or to the Prospectus,
will furnish the Distributor copies of the
proposed amendment and will not, at any
time, whether before or after the effective
date of the Registration Statement, file any
amendment to the Registration Statement or
supplement to the Prospectus of which the
Distributor shall not previously have been
advised or to which the Distributor shall
reasonably object (based upon the accuracy
or completeness thereof) in writing;
(7) will continue to make available to its
stockholders (and forward copies to the
Distributor) of such periodic, interim and
any other reports as are now, or as
hereafter may be, required by the provisions
of the Investment Company Act of 1940; and
(8) will, for the purpose of computing the
offering price of its Series' shares, advise
the Distributor within one hour after the
close of regular trading on the New York
Stock Exchange (or as soon as practicable
thereafter) on each business day upon which
the New York Stock Exchange may be open of
the net asset value per share of the Series'
shares of common stock outstanding,
determined in accordance with any applicable
provisions of law and the provisions of the
Articles of Incorporation, as amended, of
the Company as of the close of business on
such business day. In the event that prices
are to be calculated more than once daily,
the Fund will promptly advise the
Distributor of the time of each calculation
and the price computed at each such time.
-4-
6. The Distributor agrees to submit to the Fund, prior to its use, the
form of all sales literature proposed to be generally disseminated
by or for the Distributor on behalf of the Fund all advertisements
proposed to be used by the Distributor, and all sales literature or
advertisements prepared by or for the Distributor for such
dissemination or for use by others in connection with the sale of
the Series' shares. The Distributor also agrees that the Distributor
will submit such sales literature and advertisements to the NASD,
SEC or other regulatory agency as from time to time may be
appropriate, considering practices then current in the industry. The
Distributor agrees not to use or to permit others to use such sales
literature or advertisements without the written consent of the Fund
if any regulatory agency expresses objection thereto or if the Fund
delivers to the Distributor a written objection thereto.
7. The purchase price of each share sold hereunder shall be the
offering price per share mutually agreed upon by the parties hereto,
and as described in the Fund's prospectus, as amended from time to
time, determined in accordance with applicable provisions of law,
the provisions of its Articles of Incorporation and the Conduct
Rules of the National Association of Securities Dealers, Inc.
8. The responsibility of the Distributor hereunder shall be limited to
the promotion of sales of Series' shares. The Distributor shall
undertake to promote such sales solely as agent of the Fund, and
shall not purchase or sell such shares as principal. Orders for
Series' shares and payment for such orders shall be directed to the
Fund's agent, Delaware Service Company, Inc. for acceptance on
behalf of the Fund. The Distributor is not empowered to approve
orders for sales of Series' shares or accept payment for such
-5-
orders. Sales of Series' shares shall be deemed to be made when and
where accepted by Delaware Service Company, Inc.
9. With respect to the apportionment of costs between the Fund and the
Distributor of activities with which both are concerned, the
following will apply:
(a) The Fund and the Distributor will cooperate in
preparing the Registration
Statements, the Prospectus, and all amendments,
supplements and replacements thereto. The Fund will
pay all costs incurred in the preparation of the
Fund's registration statement, including typesetting,
the costs incurred in printing and mailing
prospectuses to its own shareholders and fees and
expenses of counsel and accountants.
(b) The Distributor will pay the costs incurred in
printing and mailing copies of prospectuses to
prospective investors.
(c) The Distributor will pay advertising and promotional
expenses, including the costs of literature sent to
prospective investors.
(d) The Fund will pay the costs and fees incurred in
registering the Series' shares with the various
states and with the Securities and Exchange
Commission.
(e) The Distributor will pay the costs of any additional
copies of the Fund reports and other Fund literature
supplied to the Distributor by the Fund for sales
promotion purposes.
10. The Distributor may engage in other business, provided such other
business does not interfere with the performance by the Distributor
of its obligations under this Agreement.
-6-
11. The Fund agrees to indemnify, defend and hold harmless from the
assets of the Series, the Distributor and each person, if any, who
controls the Distributor within the meaning of Section 15 of the
Securities Act of 1933, from and against any and all losses,
damages, or liabilities to which, jointly or severally, the
Distributor or such controlling person may become subject, insofar
as the losses, damages or liabilities arise out of the performance
of its duties hereunder, except that the Fund shall not be liable
for indemnification of the Distributor or any controlling person
thereof for any liability to the Fund or its security holders to
which they would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of
their duties hereunder or by reason of their reckless disregard of
their obligations and duties under this Agreement.
12. Copies of financial reports, registration statements and
prospectuses, as well as demands, notices, requests, consents,
waivers, and other communications in writing which it may be
necessary or desirable for either party to deliver or furnish to
the other will be duly delivered or furnished, if delivered to such
party at its address shown below during regular business hours, or
if sent to that party by registered mail or by prepaid telegram
filed with an office or with an agent of Western Union, in all
cases within the time or times herein prescribed, addressed to the
recipient at 0000 Xxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000,
or at such other address as the Fund or the Distributor may
designate in writing and furnish to the other.
13. This Agreement shall not be assigned, as that term is defined in
the Investment Company Act of 1940, by the Distributor and shall
terminate automatically in the event of its attempted assignment by
the Distributor. This Agreement shall not be assigned by the Fund
without the written consent of the Distributor signed by its duly
authorized officers
-7-
and delivered to the Fund. Except as specifically provided in the
indemnification provisions contained in Paragraph 11 hereof, this
contract and all conditions and provisions hereof are for the sole
and exclusive benefit of the parties hereto and their legal
successors and no express or implied provisions of this Agreement
are intended or shall be construed to give any person other than
the parties hereto and their legal successors any legal or
equitable right, remedy or claim under or in respect of this
Agreement or any provisions herein contained. The Distributor shall
look only to the assets of the Fund to meet the obligations of, or
claims against, the Fund under this Agreement and not to the holder
of any share of the Fund.
14. (a) This contract shall remain in force for a period of
two years from the date of execution of this
Agreement and from year to year thereafter, but only
so long as such continuance is specifically approved
at least annually by the Board of Directors or by
vote of a majority of the outstanding voting
securities of the Series and only if the terms and
the renewal thereof have been approved by the vote of
a majority of the Directors of the Fund, who are not
parties hereto or interested persons of any such
party, cast in person at a meeting called for the
purpose of voting on such approval.
(b) The Distributor may terminate this contract on
written notice to the Fund at any time in case the
effectiveness of the Registration Statement shall be
suspended, or in case Stop Order proceedings are
initiated by the U. S. Securities and Exchange
Commission in respect of the Registration Statement
and such proceedings are not withdrawn or terminated
within thirty days. The Distributor may also
terminate this contract at any time by giving the
Fund written notice of
-8-
its intention to terminate the contract at the
expiration of three months from the date of delivery
of such written notice of intention to the Fund.
(c) The Fund may terminate this contract at any time on
at least thirty days prior written notice to the
Distributor (1) if proceedings are commenced by the
Distributor or any of its stockholders for the
Distributor's liquidation or dissolution or the
winding up of the Distributor's affairs; (2) if a
receiver or trustee of the Distributor or any of its
property is appointed and such appointment is not
vacated within thirty days thereafter; (3) if, due to
any action by or before any court or any federal or
state commission, regulatory body, or administrative
agency or other governmental body, the Distributor
shall be prevented from selling securities in the
United States or because of any action or conduct on
the Distributor's part, sales of the shares are not
qualified for sale. The Fund may also terminate this
contract at any time upon prior written notice to the
Distributor of its intention to so terminate at the
expiration of three months from the date of the
delivery of such written notice to the Distributor.
15. The validity, interpretation and construction of this contract, and
of each part hereof, will be governed by the laws of the
Commonwealth of Pennsylvania.
-9-
16. In the event any provision of this contract is determined to be
void or unenforceable, such determination shall, not affect the
remainder of the contract, which shall continue to be in force.
DELAWARE DISTRIBUTORS, L.P.
By: DELAWARE DISTRIBUTORS, INC.,
Attest: General Partner
/s/Xxxxxxx X.Xxxxx By: /s/Xxxxx X. Xxxxxx
------------------ ------------------
Xxxxxxx X.Xxxxx Xxxxx X. Xxxxxx
Assistant Vice President/ Executive Vice President
Assistant Secretary/ Chief Operating Officer
Senior Counsel Chief Financial Officer
DELAWARE GROUP PREMIUM FUND, INC.
Attest: For the REIT SERIES
/s/Xxxxxxx X. Xxxxxxxxxx By: /s/Xxxxx X. Xxxxx
------------------------ -----------------
Xxxxxxx X. Xxxxxxxxxx Xxxxx X. Xxxxx
Assistant Vice President/ Chairman
Assistant Secretary/
Senior Counsel
-10-
