SUB-DISTRIBUTION AGREEMENT
This
Agreement made this 25th day of June, 2008, by and among CAPITAL MANAGEMENT INVESTMENT
TRUST, a Massachusetts business trust (the “Trust”), XXXXXXX & COMPANY, INC., a
New York Corporation (the “Distributor”), and MATRIX CAPITAL GROUP, INC., a
New York Corporation (the “Sub-Distributor”).
W I T N E
S S E T H:
WHEREAS,
the Trust is registered as an open-end management investment company under the
Investment Company Act of 1940 (the “1940 Act”) and is authorized to issue
shares of beneficial interests (“Shares”) in separate series with each such
series representing interests in a separate portfolio of securities and other
assets; and
WHEREAS,
the Distributor has been appointed as the Trust’s principal underwriter pursuant
to a Distribution Agreement between the Trust and the Distributor;
and
WHEREAS,
the Distributor and the Sub-Distributor are each registered as a broker-dealer
under the Securities Exchange Act of 1934 (the “1934 Act”) and are each a member
in good standing of Financial Industry Regulatory Authority, Inc. (the “FINRA”);
and
WHEREAS,
the Distributor wishes to enter into an agreement with the Sub-Distributor with
respect to the continuous offering of the Shares of the series of the Trust set
forth on Appendix A (the “Funds”), as such Appendix may be amended from time to
time;
NOW,
THEREFORE, the parties agree as follows:
1. Appointment
of Sub-Distributor. The Distributor
hereby appoints the Sub-Distributor as its agent to sell and to arrange for the
sale of the Shares, on the terms and for the period set forth in this Agreement,
and the Sub-Distributor hereby accepts such appointment and agrees to act
hereunder directly and/or through the Funds’ transfer agent in the manner set
forth in the Prospectus (as defined below). It is understood and
agreed that the services of the Sub-Distributor hereunder are not exclusive, and
the Distributor may continue to act as underwriter or distributor for the sale
of Shares and appoint other sub-distributors from time to time.
2. Services and Duties of the
Sub-Distributor.
(a) The
Sub-Distributor agrees to sell the Shares, as agent for the Distributor, from
time to time during the term of this Agreement upon the terms described in the
Prospectus. As used in this Agreement, the term “Prospectus” shall
mean the prospectus and statement of additional information with respect to the
Funds included as part of the Trust’s Registration Statement, as such prospectus
and statement of additional information may be amended or supplemented from time
to time, and the term “Registration Statement” shall mean the Registration
Statement most recently filed from time to time by the Trust with the Securities
and Exchange Commission (“SEC”) and effective under the Securities Act of 1933
(the “1933 Act”) and the 1940 Act, as such Registration Statement is amended by
any amendments thereto at the time in effect. The Sub-Distributor
shall not be obligated to sell any certain number of Shares.
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(b) The
Sub-Distributor will hold itself available to receive orders, satisfactory to
the Sub-Distributor, for the purchase of the Shares and will accept such orders
and will transmit such orders and funds received by it in payment for such
Shares as are so accepted to the Funds’ transfer agent or custodian, as
appropriate, as promptly as practicable. Purchase orders shall be
deemed accepted and shall be effective at the time and in the manner set forth
in the Funds’ Prospectus. The Sub-Distributor shall not make any
short sales of Shares.
(c) The
offering price of the Shares shall be the net asset value per share of the
Shares, plus the sales charge, if any (determined as set forth in the
Prospectus). The Distributor shall furnish the Sub-Distributor, with
all possible promptness, an advice of each computation of net asset value and
offering price.
(d) The
Sub-Distributor shall have the right to enter into selected dealer agreements
with securities dealers of its choice (“selected dealers”) for the sale of
Shares. Shares sold to selected dealers shall be for resale by such
dealers only at the offering price of the Shares as set forth in the
Prospectus. The Sub- Distributor shall offer and sell Shares only to
such selected dealers as are members in good standing of the NASD.
(e) Fund/SERV
Transactions. The Sub-Distributor agrees to process and transmit
through the mutual fund service division of National Securities Clearing
Corporation (“NSCC”) all purchases, redemptions and other transactions in the
Shares. The Trust will be bound by all transactions entered into NSCC
by the Sub-Distributor. The Sub-Distributor will utilize the services
of NSCC for any other purpose as it deems to be appropriate or necessary
relative to the processing or transmittal of transactions in the
Shares. The authority of the Sub-Distributor under this paragraph
shall continue in effect until such time as NSCC is otherwise notified by the
Sub-Distributor.
3. Duties of the
Trust.
(a) Maintenance
of Federal Registration. The Trust shall, at its expense, take, from
time to time, all necessary action and such steps, including payment of the
related filing fees, as may be necessary to register and maintain registration
of a sufficient number of Shares under the 1933 Act. The Trust agrees
to file from time to time such amendments, reports and other documents as may be
necessary in order that there may be no untrue statement of a material fact in a
Registration Statement or Prospectus, or necessary in order that there may be no
omission to state a material fact in the Registration Statement or Prospectus
which omission would make the statements therein misleading.
(b) Maintenance
of “Blue Sky” Qualifications. The Trust shall, at its expense, use
its best efforts to qualify and maintain the qualification of an appropriate
number of Shares for sale under the securities laws of such states as the
Distributor and the Trust may approve. The Trust will advise the
Sub-Distributor in writing of the states and jurisdictions in which the shares
of each Fund are qualified for sale under, or exempt from the requirements of,
applicable law. The Sub-Distributor shall furnish such information
and other material relating to its affairs and activities as may be required by
the Trust or the Funds in connection with such qualifications.
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(c) Copies of
Reports and Prospectuses. The Trust shall, at its expense, keep the
Sub-Distributor fully informed with regard to its affairs and in connection
therewith shall furnish to the Sub-Distributor copies of all information,
financial statements and other papers which the Sub-Distributor may reasonably
request for use in connection with the distribution of Shares, including such
reasonable number of copies of Prospectuses and annual and interim reports as
the Sub-Distributor may request and shall cooperate fully in the efforts of the
Sub-Distributor to sell and arrange for the sale of the Shares and in the
performance of the Sub-Distributor under this Agreement.
4. Compensation. As compensation for the
services performed and the expenses assumed by Sub-Distributor under this
Agreement including, but not limited to, any commissions paid for sales of
Shares, Sub-Distributor shall be entitled to the fees and expenses set forth in
Appendix B to this Agreement which are payable monthly. Such fees shall be paid
to Sub-Distributor by the Distributor.
5. Conformity
with Applicable Law and Rules. The
Sub-Distributor agrees that in selling Shares hereunder it shall conform in all
respects with the laws of the United States and of any state in which Shares may
be offered, and with applicable rules and regulations of the NASD.
6. Independent
Contractor. In performing its
duties hereunder, the Sub- Distributor shall be an independent contractor and
neither the Sub-Distributor, nor any of its officers, directors, employees or
representatives is or shall be an employee of the Trust in the performance of
the Sub-Distributor’s duties hereunder. The Sub-Distributor shall be
responsible for its own conduct and the employment, control, and conduct of its
agents and employees and for injury to such agents or employees or to others
through its agents or employees. The Sub-Distributor assumes full
responsibility for its agents and employees under applicable statutes and agrees
to pay all employee taxes thereunder.
7. Indemnification. The Distributor
agrees to indemnify and hold harmless the Sub-Distributor and each of its
present or former directors, officers, employees, representatives, agents,
affiliates and stockholders against any and all losses, liabilities, damages,
claims or expenses (including the reasonable costs of investigating or defending
any alleged loss, liability, damage, claim or expense and reasonable legal
counsel fees incurred in connection therewith) to which the Sub-Distributor or
any such person may become subject under the 1933 Act, under any other statute,
at common law, or otherwise, arising out of this Agreement.
The
Distributor shall be entitled to participate, at its own expense, in the
defense, or, if the Distributor so elects, to assume the defense of any suit
brought against the Sub-Distributor and/or the other indemnified persons, but if
the Distributor elects to assume the defense, such defense shall be conducted by
legal counsel chosen by the Distributor and satisfactory to the Sub-Distributor
and to the persons indemnified as defendant or defendants, in the
suit. In the event that the Distributor elects to assume the defense
of any such suit and retain such legal counsel, the Sub-Distributor and the
persons indemnified as defendant or defendants in the suit shall bear the fees
and expenses of any additional legal counsel retained by them. If the
Distributor does not elect to assume the defense of any such suit, the
Distributor will reimburse the Sub-Distributor and the persons indemnified as
defendant or defendants in such suit for the reasonable fees and expenses of any
legal counsel retained by them. The Distributor agrees to promptly
notify the Sub-Distributor of the commencement of any litigation or proceedings
against it or any of its directors, officers, employees or representatives in
connection with the issue or sale of any Shares.
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8. Authorized
Representations. The
Sub-Distributor is not authorized by the Trust or the Distributor to give on
behalf of the Trust any information or to make any representations in connection
with the sale of Shares other than the information and representations contained
in a Registration Statement or Prospectus filed with the SEC under the 1933 Act
and/or the 1940 Act, covering Shares, as such Registration Statement and
Prospectus may be amended or supplemented from time to time, or contained in
shareholder reports or other material that may be prepared by or on behalf of
the Trust for the Sub-Distributor’s use.
9. Term of
Agreement. The term of this
Agreement shall begin on the date first above written, and unless sooner
terminated as hereinafter provided, this Agreement shall remain in effect for a
period of two years from the date first above written. Thereafter,
this Agreement shall continue in effect from year to year, subject to the
termination provisions and all other terms and conditions thereof, so long as
such continuation shall be specifically approved at least annually by (i) the
Board of Trustees or by vote of a majority of the outstanding voting securities
of each Fund and, (ii) by the vote, cast in person at a meeting called for the
purpose of voting on such approval, of a majority of the Trustees of the Trust
who are not parties to this Agreement or interested persons of any such
party. The Sub-Distributor shall furnish to the Trust, promptly upon
its request, such information as may reasonably be necessary to evaluate the
terms of this Agreement or any extension, renewal or amendment
hereof.
10. Amendment
or Assignment of Agreement. This Agreement
may not be amended or assigned except as permitted by the 1940 Act, and this
Agreement shall automatically and immediately terminate in the event of its
assignment.
11. Termination
of Agreement. This Agreement
may be terminated by any party hereto, without the payment of any penalty, on
not more than upon 60 days’ nor less than 30 days’ prior notice in writing to
the other party; provided, that in the case of termination by the Trust such
action shall have been authorized by resolution of a majority of the Trustees of
the Trust who are not parties to this Agreement or interested persons of any
such party, or by vote of a majority of the outstanding voting securities of
each Fund.
12. Miscellaneous. The captions in
this Agreement are included for convenience of reference only and in no way
define or delineate 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.
Nothing
herein contained shall be deemed to require the Trust to take any action
contrary to its Agreement and Declaration of Trust or By-Laws, or any applicable
statutory or regulatory requirement to which it is subject or by which it is
bound, or to relieve or deprive the Board of Trustees of the Trust of
responsibility for and control of the conduct of the affairs of the
Trust.
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13. Definition
of Terms. Any question of
interpretation of any term or provision of this Agreement having a counterpart
in or otherwise derived from a term or provision of the 1940 Act shall be
resolved by reference to such term or provision of the 1940 Act and to
interpretation thereof, if any, by the United States courts or, in the absence
of any controlling decision of any such court, by rules, regulations or orders
of the SEC validly issued pursuant to the 1940 Act. Specifically, the
terms “vote of a majority of the outstanding voting securities,” “interested
persons,” “assignment,” and “affiliated person,” as used in Paragraphs 8, 9 and
10 hereof, shall have the meanings assigned to them by Section 2(a) of the 1940
Act. In addition, where the effect of a requirement of the 1940 Act
reflected in any provision of this Agreement is relaxed by a rule, regulation or
order of the SEC, whether of special or of general application, such provision
shall be deemed to incorporate the effect of such rule, regulation or
order.
14. Compliance with Securities
Laws. The Trust represents that it is registered as an
open-end management investment company under the 1940 Act, and agrees that it
will comply with all the provisions of the 1940 Act and of the rules and
regulations thereunder. The parties agree to comply with all of the
applicable terms and provisions of the 1940 Act, the 1933 Act and, subject to
the provisions of Section 4(d), all applicable “Blue Sky” laws. The
Distributor and the Sub-Distributor each agree to comply with all of the
applicable terms and provisions of the 1934 Act.
15. Limitation
of Liability. It is expressly
agreed that the obligations of the Trust hereunder shall not be binding upon any
of the Trustees, shareholders, nominees, officers, agents or employees of the
Trust, personally, but bind only the trust property of the Funds. The
execution and delivery of this Agreement have been authorized by the Trustees of
the Trust and signed by an officer of the Trust, acting as such, and neither
such authorization by such Trustees nor such execution and delivery by such
officer shall be deemed to have been made by any of them individually or to
impose any liability on any of them personally, but shall bind only the trust
property of the Funds.
16. Notices. Any notice
required to be given pursuant to this Agreement shall be deemed duly given if
delivered or mailed by registered mail, postage prepaid, to the Trust at 000
Xxxxxxxx, 00xx Xxxxx,
Xxx Xxxx, XX 00000 or to the Distributor at 000 Xxxxxxxx, Xxxxx 00xx, Xxx Xxxx,
XX 00000, or to the Sub-Distributor at 000 Xxxxxxxxx Xxxxxx, Xxxxx 000, Xxx
Xxxx, XX 00000-0000.
17. Governing
Law. This Agreement
shall be construed in accordance with the laws of the State of New York, without
regard to conflicts of law principles. To the extent that the
applicable laws of the State of New York or any of the provisions herein,
conflict with the applicable provisions of the 1940 Act, the later shall
control, and nothing herein shall be construed in a manner inconsistent with the
1940 Act or any rule or order of the SEC thereunder.
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IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by
their officers designated as of the day and year first above
written.
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Appendix
A
To The
Sub-Distribution Agreement among the Capital Management Investment Trust,
Xxxxxxx & Company, Inc. and Matrix Capital Group, Inc.
Fund(s) subject to this
Agreement
Names of
Funds
|
·
|
Cusip
Number
000000000 NASADAQ
Symbol CMSSX
|
Capital
Management Small-Cap Fund Institutional Shares
|
·
|
Cusip
Number
000000000 NASADAQ
Symbol CMSVX
|
Capital
Management Small-Cap Fund Investor Shares
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Appendix
B
Fees
To The
Sub-Distribution Agreement among the Capital Management Investment Trust,
Xxxxxxx & Company, Inc. and Matrix Capital Group, Inc.
Sub-Distribution
Services
|
·
|
$2,500
Annual fee and will be paid monthly
|
Basic Distribution
Services
|
·
|
No
Fee
|
|
·
|
Minimum
annual fee: None
|
NSCC– DTC
Fees
|
·
|
Transaction
Fees – billed by NSCC to the Fund for
activity
|
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