Exhibit (e)(1)
UNDERWRITING AND DISTRIBUTION SERVICES AGREEMENT
AGREEMENT made this 7th day of September, 1998 between INVESTMENT TRUST, a
Massachusetts business trust (the "Trust"), on behalf of Classic Growth Fund, a
series of the Trust (the "Fund"), and XXXXXX DISTRIBUTORS, INC., a Delaware
corporation ("KDI").
In consideration of the mutual covenants hereinafter contained, it is hereby
agreed by and between the parties hereto as follows:
1. The Trust hereby appoints KDI to act as agent for the distribution of shares
of beneficial interest (hereinafter called "shares") of the Class A shares,
Class B shares and Class C shares of the Fund in jurisdictions wherein shares of
the Fund may legally be offered for sale; provided, however, that the Trust in
its absolute discretion may (a) issue or sell shares directly to holders of
shares of the Fund upon such terms and conditions and for such consideration, if
any, as it may determine, whether in connection with the distribution of
subscription or purchase rights, the payment or reinvestment of dividends or
distributions, or otherwise; or (b) issue or sell shares at net asset value to
the shareholders of any other investment company, for which KDI shall act as
exclusive distributor, who wish to exchange all or a portion of their investment
in shares of such other investment company for shares of the Fund. KDI shall
appoint various financial service firms ("Firms") to provide distribution
services to investors. The Firms shall provide such office space and equipment,
telephone facilities, personnel, literature distribution, advertising and
promotion as is necessary or beneficial for providing information and
distribution services to existing and potential clients of the Firms. KDI may
also provide some of the above services for the Trust.
KDI accepts such appointment as distributor and principal underwriter and agrees
to render such services and to assume the obligations herein set forth for the
compensation herein provided. KDI shall for all purposes herein provided be
deemed to be an independent contractor and, unless expressly provided herein or
otherwise authorized, shall have no authority to act for or represent the Trust
in any way. KDI, by separate agreement with the Trust, may also serve the Trust
in other capacities. The services of KDI to the Trust under this Agreement are
not to be deemed exclusive, and KDI shall be free to render similar services or
other services to others so long as its services hereunder are not impaired
thereby.
In carrying out its duties and responsibilities hereunder, KDI will, pursuant to
separate written contracts, appoint various Firms to provide advertising,
promotion and other distribution services contemplated hereunder directly to or
for the benefit of existing and potential shareholders who may be clients of
such Firms. Such Firms shall at all times be deemed to be independent
contractors retained by KDI and not the Trust.
KDI shall use its best efforts with reasonable promptness to sell such part of
the authorized shares of the Fund remaining unissued as from time to time shall
be effectively registered under the Securities Act of 1933 ("Securities Act"),
at prices determined as hereinafter provided and on terms hereinafter set forth,
all subject to applicable federal and state laws and regulations and to the
Declaration of Trust of the Trust.
2. KDI shall sell shares of the Fund to or through qualified Firms in such
manner, not inconsistent with the provisions hereof and the then effective
registration statement (and related prospectus) of the Fund under the Securities
Act, as KDI may determine from time to time, provided that no Firm or other
person shall be appointed or authorized to act as agent of the Fund without the
prior consent of the Trust. In addition to sales made by it as agent of the
Fund, KDI may, in its discretion, also sell shares of the Fund as principal to
persons with whom it does not have selling group agreements.
Shares of any class of the Fund offered for sale or sold by KDI shall be so
offered or sold at a price per share determined in accordance with the then
current prospectus. The price the Trust shall receive, on behalf of the Fund,
for all Fund shares purchased from it shall be the net asset value used in
determining the public offering price applicable to the sale of such shares. Any
excess of the sales price over the net asset value of the shares of the Fund
sold by KDI as agent shall be retained by KDI as a commission for its services
hereunder. KDI may compensate Firms for sales of shares at the commission levels
provided in the Fund's prospectus from time to time. KDI may pay other
commissions, fees or concessions to Firms, and may pay them to others in its
discretion, in such amounts as KDI shall determine from time to time. KDI shall
be entitled to receive and retain any applicable contingent deferred sales
charge as described in the Fund's prospectus. KDI shall also receive any
distribution services fee payable by the Fund as provided in the Fund's Amended
and Restated Rule 12b-1 Plan, as amended from time to time (the "Plan").
KDI will require each Firm to conform to the provisions hereof and the
Registration Statement (and related prospectus) at the time in effect under the
Securities Act with respect to the public offering price or net asset value, as
applicable, of the Fund's shares, and neither KDI nor any such Firms shall
withhold the placing of purchase orders so as to make a profit thereby.
3. The Trust will use its best efforts to keep effectively registered under the
Securities Act for sale as herein contemplated such shares as KDI shall
reasonably request and as the Securities and Exchange Commission shall permit to
be so registered. Notwithstanding any other provision hereof, the Trust may
terminate, suspend or withdraw the offering of Fund shares whenever, in its sole
discretion, it deems such action to be desirable.
4. The Trust will execute any and all documents and furnish any and all
information that may be reasonably necessary in connection with the
qualification of Fund shares for sale (including the qualification of the Trust
or the Fund as a dealer where necessary or advisable) in such states as KDI may
reasonably request (it being understood that the Trust shall not be required
without its consent to comply with any requirement which in its opinion is
unduly burdensome). The Trust will furnish to KDI from time to time such
information with respect to the Fund and its shares as KDI may reasonably
request for use in connection with the sale of shares of the Fund.
5. KDI shall issue and deliver or shall arrange for various Firms to issue and
deliver on behalf of the Fund such confirmations of sales made by it pursuant to
this agreement as may be required. At or prior to the time of issuance of
shares, KDI will pay or cause to be paid to the Fund the
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amount due the Trust, on behalf of the Fund, for the sale of such Fund shares.
Certificates shall be issued or shares registered on the transfer books of the
Fund in such names and denominations as KDI may specify.
6. KDI shall order shares of the Fund from the Trust only to the extent that it
shall have received purchase orders therefor. KDI will not make, or authorize
Firms or others to make (a) any short sales of shares of the Fund; or (b) any
sales of such shares to any Trustee or officer of the Trust or to any officer or
director of KDI or of any corporation or association furnishing investment
advisory, managerial or supervisory services to the Fund, or to any corporation
or association, unless such sales are made in accordance with the then current
prospectus relating to the sale of such shares. KDI, as agent of and for the
account of the Fund, may repurchase the shares of the Fund at such prices and
upon such terms and conditions as shall be specified in the current prospectus
of the Fund. In selling or reacquiring shares of the Fund for the account of the
Fund, KDI will in all respects conform to the requirements of all state and
federal laws and the Conduct Rules of the National Association of Securities
Dealers, Inc., relating to such sale or reacquisition, as the case may be, and
will indemnify and save harmless the Trust and its Trustees from any damage or
expense on account of any wrongful act or failure to act by KDI or any employee,
representative or agent of KDI. KDI will observe and be bound by all the
provisions of the Declaration of Trust of the Trust (and of any fundamental
policies adopted by the Trust pursuant to the Investment Company Act of 1940,
notice of which shall have been given to KDI) which at the time in any way
require, limit, restrict, prohibit or otherwise regulate any action on the part
of KDI hereunder.
7. The Trust, on behalf of the Fund, shall assume and pay all charges and
expenses of its operations not specifically assumed or otherwise to be provided
by KDI under this Agreement or the Plan. The Trust, on behalf of the Fund, will
pay or cause to be paid expenses (including the fees and disbursements of its
own counsel) of any registration of the Fund and its shares under the United
States securities laws and expenses incident to the issuance of shares of
beneficial interest, such as the cost of share certificates, issue taxes, and
fees of the transfer agent. KDI will pay all expenses (other than expenses which
one or more Firms may bear pursuant to any agreement with KDI) incident to the
sale and distribution of the shares issued or sold hereunder, including, without
limiting the generality of the foregoing, all (a) expenses of printing and
distributing any prospectus and of preparing, printing and distributing or
disseminating any other literature, advertising and selling aids in connection
with the offering of the shares for sale (except that such expenses need not
include expenses incurred by the Fund in connection with the preparation,
typesetting, printing and distribution of any registration statement or
prospectus, report or other communication to shareholders in their capacity as
such), (b) expenses of advertising in connection with such offering and (c)
expenses (other than the Fund's auditing expenses) of qualifying or continuing
the qualification of the shares for sale and, in connection therewith, of
qualifying or continuing the qualification of the Trust as a dealer or broker
under the laws of such states as may be designated by KDI under the conditions
herein specified. No transfer taxes, if any, which may be payable in connection
with the issue or delivery of shares sold as herein contemplated or of the
certificates for such shares shall be borne by the Fund, and KDI will indemnify
and hold harmless the Trust against liability for all such transfer taxes.
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8. The net asset value shall be calculated in accordance with the provisions of
the Fund's current prospectus. On each day when net asset value is not
calculated, the net asset value of a share of any class of any series of the
Fund shall be deemed to be the net asset value of such a share as of the close
of business on the last previous day on which such calculation was made.
9. This Agreement shall become effective on the date hereof and shall continue
until September 30, 1999; and shall continue from year to year thereafter only
so long as such continuance is approved in the manner required by the Investment
Company Act of 1940.
This Agreement shall automatically terminate in the event of its assignment and
may be terminated at any time without the payment of any penalty by the Trust or
by KDI on sixty (60) days' written notice to the other party. The Trust, on
behalf of the Fund, may effect termination with respect to any class of any
class of the Fund by a vote of (i) a majority of the Board of Trustees of the
Trust, (ii) a majority of the Trustees of the Trust who are not interested
persons of the Trust and who have no direct or indirect financial interest in
the operation of the Plan, this Agreement or in any other agreement related to
the Plan or this Agreement, or (iii) a majority of the outstanding voting
securities of such class. Without prejudice to any other remedies of the Trust,
the Trust may terminate this Agreement at any time immediately upon KDI's
failure to fulfill any of its obligations hereunder.
This Agreement may not be amended to increase the amount to be paid to KDI by
the Trust, on behalf of the Fund, for services hereunder with respect to a class
of the Fund without the vote of a majority of the outstanding voting securities
of such class. All material amendments to this Agreement must in any event be
approved by a vote of the Board of Trustees of the Trust including the Trustees
who are not interested persons of the Trust and who have no direct or indirect
financial interest in the operation of the Plan, this Agreement or in any other
agreement related to the Plan or this Agreement, cast in person at a meeting
called for such purpose.
The terms "assignment", "interested person" and "vote of a majority of the
outstanding voting securities" shall have the meanings set forth in the
Investment Company Act of 1940 and the rules and regulations thereunder.
KDI shall receive such compensation for its distribution services as set forth
in the Plan. Termination of this Agreement shall not affect the right of KDI to
receive payments on any unpaid balance of the compensation earned prior to such
termination, as set forth in the Plan.
10. KDI will not use or distribute, or authorize the use, distribution or
dissemination by Firms or others in connection with the sale of Fund shares any
statements other than those contained in the Fund's current prospectus, except
such supplemental literature or advertising as shall be lawful under federal and
state securities laws and regulations. KDI will furnish the Trust with copies of
all such material.
11. If any provision of this Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder shall not be thereby
affected.
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12. Any notice under this Agreement shall be in writing, addressed and delivered
or mailed, postage prepaid, to the other party at such address as such other
party may designate for the receipt of such notice.
13. All parties hereto are expressly put on notice of the Trust's Agreement and
Declaration of Trust, and all amendments thereto, all of which are on file with
the Secretary of The Commonwealth of Massachusetts, and the limitation of
shareholder and Trustee liability contained therein. This Agreement has been
executed by and on behalf of the Fund by its representatives as such
representatives and not individually, and the obligations of the Trust hereunder
are not binding upon any of the Trustees or officers of the Trust or the
shareholders of the Fund individually but are binding upon only the assets and
property of the Fund. With respect to any claim by KDI for recovery of any
liability of the Trust arising hereunder allocated to a particular series or
class, whether in accordance with the express terms hereof or otherwise, KDI
shall have recourse solely against the assets of that series or class to satisfy
such claim and shall have no recourse against the assets of any other series or
class for such purpose.
14. This Agreement shall be construed in accordance with applicable federal law
and with the laws of The Commonwealth of Massachusetts.
15. This Agreement is the entire contract between the parties relating to the
subject matter hereof and supersedes all prior agreements between the parties
relating to the subject matter hereof.
IN WITNESS WHEREOF, the Trust and KDI have caused this Agreement to be executed
as of the day and year first above written.
INVESTMENT TRUST, on behalf of
Classic Growth Fund
By: /s/Xxxxxx X. XxXxxxxxx
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Vice President
ATTEST:
/s/Xxxxxxxx Xxxxxxx
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Assistant Secretary
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XXXXXX DISTRIBUTORS, INC.
By: /s/Xxxxxx Xxxxxx
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Chairman
ATTEST:
/s/Xxxxxxx X. Xxxxxx
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Title: V.P.
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