Exhibit (e)
DISTRIBUTION AGREEMENT
WILSHIRE TARGET FUNDS, INC.
Providence, Rhode Island
September 27, 1999
First Data Distributors, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Ladies and Gentlemen:
This is to confirm that, in consideration of the agreements hereinafter
contained, the Wilshire Target Funds, Inc. (the "Fund") has agreed that you
shall be, for the period of this agreement, the distributors of shares of each
Class of each Series of the Fund set forth on Exhibit A hereto, as such Exhibit
may be revised from time to time (each, a "Series"). For purposes of this
agreement the term "Shares" shall mean the authorized shares of the relevant
Classes and Series.
1. Services 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 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 Fund.
1.2 You agree to use your best efforts to solicit orders for, and
otherwise to promote, the sale of Shares. To the extent that
you receive shareholder services fees under any shareholder
services plan adopted by the Fund, you agree to furnish, and/
or enter into arrangements with others for the furnishing of,
personal and/or account maintenance services with respect to
the relevant shareholders of the Fund as may be required
pursuant to such plan. It is contemplated that you will
enter into sales or servicing agreements with securities
dealers, financial institutions and other industry
professions, such as investment advisers, accountants and
estate planning firms, and in doing so may act as agent for
the Fund or 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, 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 judgement such action is warranted by
market, economic or political conditions, or by abnormal
circumstances of any kind, the Fund's officers may decline to
accept any orders for, or make any sales of, any Shares until
such time as they deem it advisable to accept such orders and
to make such sales and the Fund shall advise you promptly of
such determination.
1.5 The Fund 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 Fund hereunder, and all expenses in
connection with the preparation and printing of the Fund's
prospectuses and statements of additional information for
regulatory purposes and for distribution to shareholders;
provided, however, that nothing contained herein shall be
deemed to require the Fund to pay any of the costs of
advertising the sale of Shares.
1.6 The Fund agrees to execute any and all documents and to
furnish any and all information and otherwise to take all
actions which may be reasonably necessary in the discretion
of the Fund's officers in connection with the qualification
of Shares for sale in such states as you may designate to the
Fund and the Fund may approve, and the Fund agrees to pay all
expenses which may be incurred in connection with such
qualification. The Fund shall notify you in writing of the
states in which the Shares may be sold and shall notify you
in writing of any changes to the information contained in the
previous notification. You shall pay all expenses connected
with your own qualification as a dealer under state and
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 Fund shall furnish you from time to time, for use in connection
with the sale of Shares, such information with respect to the Fund or any
relevant Series and the Shares as you may reasonably request, all of which shall
be signed by one or more of the Fund's duly authorized officers; and the Fund
warrants that the statements contained in any such information, when so signed
by the Fund's officers, shall be true and correct. The Fund also shall furnish
you upon request with: (a) semi-annual reports and annual audited reports of the
Fund's books and accounts made by independent public accountants regularly
retained by the Fund, (b) quarterly earnings statements prepared by the Fund,
(c) a monthly itemized list of the securities in 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 Fund's financial
condition as you may reasonably request.
1.8 The Fund represents to you that all registration statements and
prospectuses filed by the Fund with the Securities and Exchange Commission under
the Securities Act of 1933, as amended, and under the Investment Company Act of
1940, as amended, with respect to the Shares have been carefully prepared in
conformity with the 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 which at any time shall
have been filed with said Commission. The Fund 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 not misleading. The Fund 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 Fund's counsel, be necessary or advisable. If the Fund shall not propose
such amendment or amendments and/or controlling supplement of supplements within
fifteen days after receipt by the Fund of a written request from you to do so,
you may, at your option, terminate this agreement or decline to make offers of
the Fund's securities until such amendments are made. The Fund 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 Fund's right to
file at any time such amendments to any registration statement and/or
supplements to any prospectus, of whatever character, as the Fund may deem
advisable, such right being in all respect absolute and unconditional.
1.9 The Fund authorizes you to use any prospectus in the form furnished to
you from time to time, in connection with the sale of Shares. The Fund 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 (i) 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 such
controlling person, may incur, directly or indirectly, under the Securities Act
of 1933, as amended, or under common law or otherwise, arising out of or based
upon any untrue statement, or alleged untrue statement, of a material fact
contained in any registration statement or any prospectus or arising out of or
based upon any omission, or alleged omission, to state a material fact required
to be stated in either any registration statement or any prospectus or necessary
to make the statements in either thereof not misleading; provided, however, that
the Fund's agreement to indemnify you, your officers or directors, and any such
controlling person shall not be deemed to cover any claims, demands, liabilities
or expenses arising out of any untrue statement or alleged untrue statement or
omission or alleged omission made in any registration statement or prospectus in
reliance upon and in conformity with written information furnished to the Fund
by you specifically for use in the preparation thereof; and (ii) from and
against any and all such claims, demands, liabilities and expenses (including
such costs and counsel fees) which you, your officers and directors, or such
controlling persons, may incur in connection with this Agreement or your
performance hereunder (but excluding such claims, demands, liabilities and
expenses (including such costs and counsel fees) arising out of or based upon
any untrue statement, or alleged untrue statement, of a material fact contained
in any registration statement or any prospectus or arising out of or based upon
any omission, or alleged omission, to state a material fact required to be
stated in either any registration statement or any prospectus or necessary to
make the statements in either thereof not misleading, unless such claims,
demands, liabilities and expenses (including such costs and counsel fees) arise
by reason of your willful misfeasance, bad faith or negligence in the
performance of your duties hereunder. The Fund acknowledges and agrees that in
the event that you at the request of the Fund, are required to give an
indemnification comparable to that set forth in clause (i) of Section 1.9 of
this Agreement to any broker-dealer selling Shares of the Fund and such
broker-dealer shall make a claim for indemnification against you, you will make
a similar claim for indemnification against the Fund. The Fund's agreement to
indemnify you, your officers and directors, and any such controlling person, as
aforesaid, is expressly conditioned upon the Fund's being notified of any action
brought against you, your officers or directors, or any such controlling person,
such notification to be given by letter or by telegram addressed to the Fund at
its address set forth above within ten days after the summons or other first
legal process shall have been served. The failure so to notify the Fund of any
such action shall not relieve the Fund from any liability which the Fund 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, otherwise
than on account of the Fund's indemnity agreement contained in this paragraph
1.9. The Fund 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 Fund and approved
by you. In the event the Fund 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 Fund does not elect to assume the defense of any
such suit, or in case you do not approve of counsel chosen by the Fund, the Fund
will reimburse you, your officers and directors, or the controlling person or
persons named as defendant or defendants in such suit, of the fees and expenses
of any counsel retained by you or them. The Fund's indemnification agreement
contained in this paragraph 1.9 and the Fund'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 Fund agrees
promptly to notify you of the commencement of any litigation or proceedings
against the Fund or any of its officers or Board members in connection with the
issue and sale of Shares.
1.10 You agree to indemnify, defend and hold the Fund, its several officers
and Board members, and any person who controls the Fund 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 Fund, its officers or
Board members, or any such controlling person, may incur directly or indirectly
under the Securities Act of 1933, as amended, or under state securities law,
federal or state common law or otherwise, but only to the extent that such
liability or expense incurred by the Fund, its officers or Board members, or
such controlling person resulting from such claims or demands, (i) 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 Fund
specifically for use in the Fund'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, (ii) 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 Fund and
required to be stated in such answers or necessary to make such information not
misleading, or (iii) shall arise out of any violation by you of any provision of
this agreement or any provision of applicable law, or (iv) shall arise out of or
be based upon your willful misfeasance, bad faith, or negligence in the
performance of your duties hereunder. Your agreement to indemnify the Fund, 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
Fund, its officers or Board members, or any such controlling person, such
notification to be given by letter or telegram addressed to you at your address
set forth above within ten days 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 Fund, if such
action is based solely upon such alleged misstatement or omission on your part,
and in any other event the Fund, its offices 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 which you may have to
the Fund, 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, otherwise than on account of your indemnity agreement contained in
this paragraph 1.10. This agreement of indemnity will inure exclusively to the
Fund's benefit, to the benefit of the Fund'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 Fund 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.
1.11 No Shares shall be offered by either you or the Fund 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 Fund 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 1.11 shall in any way restrict or have an application to or
bearing upon the Fund's obligation to repurchase any Shares from any shareholder
in accordance with the provisions of the Fund's prospectus or charter documents.
1.12 The Fund 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 which makes untrue any
statement of a material fact made in the registration
statement or prospectus then in effect or which
requires the making of a change in such registration
statement or prospectus in order to make the
statements therein not misleading; and
(d) of all actions of the Securities and Exchange
Commission with respect to any amendments to any
registration statement or prospectus which may from
time to time be filed with Securities and Exchange
Commission.
1.13 Each party shall have the duty to mitigate damages from which the other
party may become responsible.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN
NO EVENT SHALL EITHER PARTY, THEIR AFFILIATES OR ANY OF THEIR
DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR SUBCONTRACTORS BE
LIABLE FOR EXEMPLARY, PUNITIVE, SPECIAL, INDIRECT OR
CONSEQUENTIAL DAMAGES.
2. Offering Price
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Shares of any class of the Fund offered for sale by you shall be offered for
sale at a price per share (the "offering price") approximately equal to (a)
their net asset value (determined in the manner set forth in the Fund's charter
documents) plus (b) a sales charge, if any (except with respect to sales to
those persons set forth in the then-current prospectus to whom sales may be made
without sales charge), which shall be the percentage of the offering price of
such Shares as set forth in the Fund'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 Fund offered for sale by you may
be subject to a contingent deferred sales charge as set forth in the Fund'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 Fund's then-current prospectus.
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3. Term
As to each Series, this agreement shall continue until the date (the
"Reapproval Date") set forth opposite such Series' name on Exhibit A hereto, and
hereto, and thereafter shall continue automatically for successive annual
periods ending on the day (the "Reapproval Day") of each year set forth on
Exhibit A hereto, provided such continuance is specifically approved at least
annually by (i) the Fund's Board or (ii) vote of a majority (as defined in the
Investment Company Act of 1940) of the Shares of the Fund 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 (the "Independent
Directors"), by vote cast in person at a meeting called for the purpose of
voting on such approval. This agreement is terminable without penalty, on 60
days' notice, by vote of holders of a majority of the Fund's or, as to any
relevant Series, such Series' outstanding voting securities or by a majority of
such Independent Directors as to the Fund or the relevant Series, as the case
may be, or by you. This agreement also will terminate automatically, as to the
Fund or relevant Series, as the case may be, in the event of its assignment (as
defined in said Act). If the Fund has adopted a multiple class plan or a
distribution plan, you agree to furnish such information as may be reasonably
necessary to assist the Directors of the Fund in their periodic evaluation of
such plan or plans.
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Non-exclusivity
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The Fund recognizes that you may act as the distributor of securities of
other persons (including other investment companies) and that you and your
affiliates may furnish brokerage, distribution and other services to other
persons (including other investment companies), and the Fund has no objection to
your so acting. The Fund acknowledges that the persons employed by you to assist
in the performance of your duties under this agreement may not devote their full
time to such service and nothing contained in the agreement shall be deemed to
limit or restrict your or any of your affiliates right to engage in and devote
time and attention to other businesses or to render services of whatever kind or
nature.
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Exclusion of Warranties
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THIS IS A SERVICE AGREEMENT. EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT,
YOU DISCLAIM ALL OTHER REPRESENTATONS OR WARRANTIES, EXPRESS OR IMPLIED, MADE TO
THE FUND OR ANY OTHER PERSON, INCLUDING WITHOUT LIMITATION, ANY WARRANTIES
REGARDING QUALITY, SUITABILITY, MERCHANTABLITY, FITNESS FOR A PARTICULAR PURPOSE
OR OTHERWISE (IRRESPECTIVE OF ANY COURSE OF DEALING, CUTOM OR USAGE OF TRADE) OF
ANY SERVICES OR ANY GOODS PROVIDED INCIDENTAL TO SERVICES PROVIDED UNDER THIS
AGREEMENT. YOU DISCLAIM ANY WARRANTY OF TITLE OR NON-INFRINGEMENT EXCEPT AS
OTHERWISE SET FORTH IN THIS AGREEMENT.
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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.
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Very truly yours,
WILSHIRE TARGET FUNDS, INC.
By:_/s/ Xxxxxx X. Xxxxxxx
Accepted:
FIRST DATA DISTRIBUTORS, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
Name of Series
Large Company Growth Portfolio
Large Company Value Portfolio
Small Company Growth Portfolio
Small Company Value Portfolio
Wilshire 5000 Index Portfolio
