Exhibit (e)(4)
CDC NVEST MID CAP GROWTH FUND
Distribution Agreement
AGREEMENT made this 15/th/ day of March, 2001 by and between NVEST FUNDS
TRUST III, a Massachusetts business trust (the "Trust"), and NVEST FUNDS
DISTRIBUTOR, L.P., a Delaware limited partnership (the "Distributor").
W I T N E S S E T H:
WHEREAS, this Agreement has been approved by the Trustees of the Trust in
contemplation of the transfer by the Distributor of its rights to receive the
Class B Distribution Fee (as defined in the Class B Distribution and Service
Plan attached hereto as Exhibit A) and/or contingent deferred sales charges to a
financing party in order to raise funds to cover distribution expenditures;
WHEREAS, the Trustees of the Trust recognize the importance to the Trust of
the Distributor being able to obtain financing with which to pay commissions on
Class B shares at the time of sale;
WHEREAS, the Trustees of the Trust acknowledge that by providing financing
to the Distributor the financing party enables the Distributor to provide
valuable services to the Series (as defined below); and
WHEREAS, the Trustees of the Trust, in the context of considering the best
interests of the Series and its shareholders at the time of and in preparation
for any vote, consent or other action that the Trustees of the Trust may from
time to time take relating to the continued receipt by the Distributor (and/or
the financing party) of the Distribution Fee, intend to consider the effect on
the Distributor and any financing party of any such vote, consent or action.
NOW, THEREFORE, in consideration of the premises and covenants hereinafter
contained, the Trust and the Distributor agree as follows:
1. Distributor. The Trust hereby appoints the Distributor as general
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distributor of shares of beneficial interest ("Series shares") of the
Trust's CDC Nvest Mid Cap GrowthFund series (the "Series") during the term
of this Agreement. The Trust reserves the right, however, to refuse at any
time or times to sell any Series shares hereunder for any reason deemed
adequate by the Board of Trustees of the Trust.
2. Sale and Payment. Under this agreement, the following provisions shall
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apply with respect to the sale of and payment for Series shares:
(a) The Distributor shall have the right, as principal, to purchase Series
shares from the Trust at their net asset value and to sell such shares
to the public against orders therefor at the applicable public
offering price, as defined in Section 4 hereof. The Distributor shall
also have the right, as principal, to sell shares to dealers against
orders therefor at the public offering price less a concession
determined by the Distributor.
(b) Prior to the time of delivery of any shares by the Trust to, or on the
order of, the Distributor, the Distributor shall pay or cause to be
paid to the Trust or to its order an amount in Boston or New York
clearing house funds equal to the applicable net asset value of such
shares. The Distributor shall retain so much of any sales charge or
underwriting discount as is not allowed by it as a concession to
dealers.
3. Fees. For its services as general distributor of the Class B Series
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shares, the Trust shall cause the Series to pay to the Distributor (or its
designee or transferee) in addition to the sales charge, if any, referred
to in Section 4 below, the Class B Distribution Fee at the rate and upon
the terms and conditions set forth in the Class B Distribution and Service
Plan attached as Exhibit A hereto, and as amended from time to time,
and the Distributor shall also be entitled to receive any contingent
deferred sales charges that may be payable upon redemption or repurchase of
Class B Series shares. The Class B Distribution Fee shall be accrued daily
and paid monthly to the Distributor (or, at its direction, to its designee
or transferee) as soon as practicable after the end of the calendar month
in which it accrues, but in any event within five business days following
the last day of the month. So long as this agreement and the Class B
Distribution and Service Plan have not been terminated in accordance with
their respective terms, the Series' obligation to pay the Class B
Distribution Fee to the Distributor shall be absolute and unconditional and
shall not be subject to any dispute, offset, counterclaim or defense
whatsoever (it being understood that nothing in this sentence shall be
deemed a waiver by the Trust or the Series of its right separately to
pursue any claims it may have against the Distributor and to enforce such
claims against any assets (other than its rights to be paid the Class B
Distribution Fee and to be paid contingent deferred sales charges with
respect to Class B Series shares) of the Distributor).
4. Public Offering Price. The public offering price shall be the net asset
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value of Series shares, plus any applicable sales charge, all as set forth
in the current prospectus and statement of additional information
("prospectus") of the Trust relating to the Series shares. In no event
shall the public offering price exceed 1000/935 of such net asset value,
and in no event shall any applicable sales charge or underwriting discount
exceed 6.5% of the public offering price. The net asset value of Series
shares shall be determined in accordance with the provisions of the
agreement and declaration of trust and by-laws of the Trust and the current
prospectus of the Trust relating to the Series shares.
5. Trust Issuance of Series Shares. The delivery of Series shares shall be
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made promptly by a credit to a shareholder's open account for the Series or
by delivery of a share certificate. The Trust reserves the right (a) to
issue Series shares at any time directly to the shareholders of the Series
as a stock dividend or stock split, (b) to issue to such shareholders
shares of the Series, or rights to subscribe to shares of the Series, as
all or part of any dividend that may be distributed to shareholders of the
Series or as all or part of any optional or alternative dividend that may
be distributed to shareholders of the Series, and (c) to sell Series shares
in accordance with the current applicable prospectus of the Trust relating
to the Series shares.
6. Redemption or Repurchase. The Distributor shall act as agent for the Trust
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in connection with the redemption or repurchase of Series shares by the
Trust to the extent and upon the terms and conditions set forth in the
current applicable prospectus of the Trust relating to the Series shares,
and the Trust agrees to reimburse the Distributor, from time to time upon
demand, for any reasonable expenses incurred in connection with such
redemptions or repurchases. The Trust will remit to the Distributor any
contingent deferred sales charges imposed on redemptions or repurchases of
Series shares (other than Class B shares) upon the terms and conditions set
forth in the then current prospectus of the Trust. The Trust will also
remit to the Distributor (or its designee or transferee), in addition to
the Class B Distribution Fee, any contingent deferred sales charges imposed
on redemptions or repurchases of Class B shares, in accordance with the
Remittance Agreement attached hereto as Exhibit B.
7. Undertaking Regarding Sales. The Distributor shall use reasonable efforts
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to sell Series shares but does not agree hereby to sell any specific number
of Series shares and shall be free to act as distributor of the shares of
other investment companies. Series shares will be sold by the Distributor
only against orders therefor. The Distributor shall not purchase Series
shares from anyone except in accordance with Sections 2 and 6 and shall not
take "long" or "short" positions in Series shares contrary to the agreement
and declaration of trust or by-laws of the Trust.
8. Compliance. The Distributor shall conform to the Conduct Rules of the
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National Association of Securities Dealers, Inc. ("NASD") and the sale of
securities laws of any jurisdiction in which it sells, directly or
indirectly, any Series shares. The Distributor agrees to make timely
filings, with the Securities and Exchange Commission in Washington, D.C.
(the "SEC"), the NASD and such other regulatory authorities as may be
required, of any sales literature relating to the Series and intended for
distribution to prospective investors. The Distributor also agrees to
furnish to the Trust sufficient copies of any agreements or plans it
intends to use in connection with any sales of Series shares in adequate
time for the Trust to file and clear them with the proper authorities
before they are put in use (which the Trust agrees
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to use its best efforts to do as expeditiously as reasonably possible), and
not to use them until so filed and cleared.
9. Registration and Qualification of Series Shares. The Trust agrees to
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execute such papers and to do such acts and things as shall from time to
time be reasonably requested by the Distributor for the purpose of
qualifying and maintaining qualification of the Series shares for sale
under the so-called Blue Sky Laws of any state or for maintaining the
registration of the Trust and of the Series shares under the federal
Securities Act of 1933 and the federal Investment Company Act of 1940 (the
"1940 Act"), to the end that there will be available for sale from time to
time such number of Series shares as the Distributor may reasonably be
expected to sell. The Trust shall advise the Distributor promptly of (a)
any action of the SEC or any authorities of any state or territory, of
which it may be advised, affecting registration or qualification of the
Trust or the Series shares, or rights to offer Series shares for sale, and
(b) the happening of any event which makes untrue any statement or which
requires the making of any change in the Trust's registration statement or
its prospectus relating to the Series shares in order to make the
statements therein not misleading.
10. Distributor Independent Contractor. The Distributor shall be an
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independent contractor and neither the Distributor nor any of its officers
or employees as such is or shall be an employee of the Trust. The
Distributor is 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 Distributor
assumes full responsibility for its agents and employees under applicable
statutes and agrees to pay all employer taxes thereunder.
11. Expenses Paid by Distributor. While the Distributor continues to act as
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agent of the Trust to obtain subscriptions for and to sell Series shares,
the Distributor shall pay the following:
(a) all expenses of printing (exclusive of typesetting) and distributing
any prospectus for use in offering Series shares for sale, and all
other copies of any such prospectus used by the Distributor, and
(b) all other expenses of advertising and of preparing, printing and
distributing all other literature or material for use in connection
with offering Series shares for sale.
12. Interests in and of Distributor. It is understood that any of the
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shareholders, trustees, officers, employees and agents of the Trust may be
a shareholder, director, officer, employee or agent of, or be otherwise
interested in, the Distributor, any affiliated person of the Distributor,
any organization in which the Distributor may have an interest or any
organization which may have an interest in the Distributor; that the
Distributor, any such affiliated person or any such organization may have
an interest in the Trust; and that the existence of any such dual interest
shall not affect the validity hereof or of any transaction hereunder except
as otherwise provided in the agreement and declaration of trust or by-laws
of the Trust, in the limited partnership agreement of the Distributor or by
specific provision of applicable law.
13. Effective Date and Termination. This Agreement shall become effective as
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of the date of its execution, and
(a) Unless otherwise terminated, this Agreement shall continue in effect
with respect to the shares of the Series so long as such continuation
is specifically approved at least annually (i) by the Board of
Trustees of the Trust or by the vote of a majority of the votes which
may be cast by shareholders of the Series and (ii) by a vote of a
majority of the Board of Trustees of the Trust who are not interested
persons of the Distributor or the Trust, cast in person at a meeting
called for the purpose of voting on such approval.
(b) This Agreement may at any time be terminated on sixty days' notice to
the Distributor either by vote of a majority of the Trust's Board of
Trustees then in office or by the vote of a majority of the votes
which may be cast by shareholders of the Series.
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(c) This Agreement shall automatically terminate in the event of its
assignment (excluding for this purpose any assignment of rights to
payment described in the recitals and in Section 18 of the Agreement
which are hereby ratified and approved).
(d) This Agreement may be terminated by the Distributor on ninety days'
written notice to the Trust.
Termination of this Agreement pursuant to this section shall be without payment
of any penalty.
14. Definitions. For purposes of this Agreement, the following definitions
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shall apply:
(a) The "vote of a majority of the votes which may be cast by shareholders
of the Series" means (1) 67% or more of the votes of the Series
present (in person or by proxy) and entitled to vote at such meeting,
if the holders of more than 50% of the outstanding shares of the
Series entitled to vote at such meeting are present; or (2) the vote
of the holders of more than 50% of the outstanding shares of the
Series entitled to vote at such meeting, whichever is less.
(b) The terms "affiliated person," "interested person" and "assignment"
shall have their respective meanings as defined in the 1940 Act
subject, however, to such exemptions as may be granted by the SEC
under the 1940 Act.
15. Amendment. This Agreement may be amended at any time by mutual consent of
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the parties, provided that such consent on the part of the Series shall be
approved (i) by the Board of Trustees of the Trust or by vote of a majority
of the votes which may be cast by shareholders of the Series and (ii) by a
vote of a majority of the Board of Trustees of the Trust who are not
interested persons of the Distributor or the Trust cast in person at a
meeting called for the purpose of voting on such approval.
16. Applicable Law and Liabilities. This Agreement shall be governed by and
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construed in accordance with the laws of The Commonwealth of Massachusetts.
All sales hereunder are to be made, and title to the Series shares shall
pass, in Boston, Massachusetts.
17. Limited Recourse. The Distributor hereby acknowledges that the Trust's
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obligations hereunder with respect to the shares of the Series are binding
only on the assets and property belonging to the Series.
18. Payments to Distributor's Transferees. The Distributor may transfer its
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rights to payments hereunder with respect to Class B shares (but not its
obligations hereunder) in order to raise funds to cover distribution
expenditures, and any such transfer shall be effective upon written notice
from the Distributor to the Trust. In connection with the foregoing, the
Series is authorized to pay all or a part of the Distribution Fee and/or
contingent deferred sales charges in respect of Class B shares directly to
such transferee as directed by the Distributor.
19. Liquidation etc. As long as the Class B Distribution and Service Plan is
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in effect, the Series shall not change the manner in which the Distribution
Fee is computed (except as may be required by a change in applicable law
after the date hereof) or adopt a plan of liquidation without the consent
of the Distributor (or any designee or transferee of the Distributor's
rights to receive payment hereunder in respect of Class B shares) except in
circumstances where a surviving entity or transferee of the Series' assets
adopts the Class B Distribution and Service Plan and assumes the
obligations of the Series to make payments to the Distributor (or its
transferee) hereunder in respect of Class B shares.
20. "Distributor's Shares" etc. The Trust, on behalf of the Series, agrees
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that it will not pay any portion of the Class B Distribution Fee which is
calculated by reference to the "Distributor's Shares" (nor shall it pay a
Distribution Fee calculated by reference to Class B shares ("Other Class B
Shares") other than the Distributor's Shares at a rate exceeding 0.75% per
annum of the net assets attributable to Other Class B Shares) to any person
other than the Distributor (or its designee or transferee) without the
written consent of the Distributor. "Distributor's Shares" shall mean (i)
Class B shares of the Series that were sold by the
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Distributor, plus (ii) Class B shares of the Series issued in connection
with the exchange, for Class B shares of the Series, of Class B shares of
another fund in the Nvest fund group that were sold by the Distributor,
plus (iii) Class B shares of the Series issued in connection with the
exchange, for Class B shares of the Series, of Class B shares of another
fund in the Nvest fund group issued in respect of the automatic
reinvestment of dividends or capital gain distributions in respect of Class
B shares of such other fund that were sold by the Distributor, plus (iv)
Class B shares of the Series issued in respect of the automatic
reinvestment of dividends or capital gain distributions in respect of Class
B shares of the Series described in clauses (i), (ii) and (iii). To the
extent permitted under the 1940 Act, the terms of this Section 20 shall
survive the termination of this Agreement.
21. Limitation on Reduction of Class B Distribution Fee. The Trust, on behalf
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of the Series, agrees that it will not reduce the Distribution Fee in
respect of Series' assets attributable to Class B shares below the annual
rate of 0.75% unless it has ceased (and not resumed) paying all "service
fees" (within the meaning of Section 2830(b)(9) of the Conduct Rules of
the NASD or any successor provision thereto) to the Distributor, to any
affiliate of the Distributor and to any other person in circumstances where
substantially all of the services and functions relating to the
distribution of Class B Series shares have been delegated to, or are being
performed by, the Distributor or an affiliate of the Distributor. To the
extent permitted under the 1940 Act, the terms of this Section 21 shall
survive the termination of this Agreement.
22. In accordance with Regulation S-P, if non-public personal information
regarding either party's customers or consumers is disclosed to the other
party in connection with this Agreement, the party receiving such
information will not disclose or use that information other than as
necessary to carry out the purposes of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
NVEST FUNDS TRUST III,
on behalf of its CDC Nvest Mid Cap Growth Fund
series
By: /s/ Xxxx X. Xxxxxx
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Name: Xxxx X. Xxxxxx
Title: President
NVEST FUNDS DISTRIBUTOR, L.P.
By: Nvest Distribution Corporation, its general
partner
By: /s/ Xxxx X. Xxxxxx
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Name: Xxxx X. Xxxxxx
Title: President
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A copy of the Agreement and Declaration of Trust establishing Nvest Funds
Trust III (the "Trust") is on file with the Secretary of The Commonwealth of
Massachusetts, and notice is hereby given that this Agreement is executed with
respect to the Trust's CDC Nvest Mid Cap Growth Fund series (the "Series") on
behalf of the Trust by officers of the Trust as officers and not individually
and that the obligations of or arising out of this Agreement are not binding
upon any of the trustees, officers or shareholders of the Trust individually but
are binding only upon the assets and property of the Series.
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