DISTRIBUTION AGREEMENT
AGREEMENT, dated as of May 1, 2004, by and between Xxxx Xxxxxxx Variable
Series Trust I (the "Trust"), on behalf of each of the one or more portfolios of
the Trust listed in Appendix A (each such portfolio a "Participating Fund"), and
Manulife Financial Securities LLC (the "Series Distributor").
WHEREAS, the Trust is a Massachusetts business trust which is registered as
an open-end investment company under the Investment Company Act of 1940 (the
"1940 Act") and sells its shares to insurance company separate accounts to which
net premiums, contributions and considerations under variable insurance and
annuity products ("Variable Products") are allocated for investment in the Trust
("Eligible Separate Accounts");
WHEREAS, the Trust has divided its shares into series, each representing a
different Fund, has further divided the shares of each Fund into three classes
of shares (NAV Class, Series I and Series II), and has adopted a plan with
respect to the Series I and shares (collectively, the "Rule 12b-1 Classes") of
each Participating Fund pursuant to Rule 12b-1 under the 1940 Act (the "Rule
12b-1 Plan");
WHEREAS, The Trust also has adopted a related plan under Rule 18f-3 (the
"Rule 18f-3 Plan") under the 1940 Act;
WHEREAS, the Rule 12b-1 Plan and the Rule 18f-3 Plan (together, the
"Plans") provide that the Rule 12b-1 Classes of a Participating Fund of the
Trust may be assessed with fees at rates specified in the Rule 12b-1 Plan;
WHEREAS, the Trust desires the Series Distributor to act as a principal
underwriter with respect to Series I and Series II shares of the Participating
Fund; and
WHEREAS, the Series Distributor is registered as a broker-dealer under the
Securities Exchange Act of 1934 and is a member of the National Association of
Securities Dealers, Inc. ("NASD");
NOW, THEREFORE, the Trust and the Series Distributor agree as follows:
1. Appointment and Acceptance
The Trust hereby appoints the Series Distributor as principal underwriter
and distributor of the shares of the Funds, and the Series Distributor hereby
accepts that appointment; provided, however, that this appointment shall extend
only to sales to Eligible Separate Accounts of Manufacturers Life Insurance
Company (U.S.A.) (hereinafter, "Manufacturers USA") and Manufacturers Life
Insurance Company of New York (hereinafter "Manufacturers New York") and
Eligible Separate Accounts of such other insurance companies as the Trust shall
have authorized in writing.
2. Rule 12b-1 Compensation to the Series Distributor
2.1. Each Participating Fund will pay Rule 12b-1 compensation to the
Series Distributor up to the net effective annual rate indicated below for each
Rule 12b-1 Class of the Fund's shares:
Series I .40%
Series II .60%
These fees shall be accrued daily and payable monthly based on the current net
assets of the applicable Rule 12b-1 Class of a Participating Fund's shares as to
which the Series Distributor has served as principal underwriter (or that are
exchanged or converted in any reorganization for other shares of any fund as to
which the Series Distributor served as a principal underwriter). "Current net
assets" for purposes of computing the amount of Rule 12b-1 Fee accrued with
respect to any class of a Participating Fund's shares shall mean the net assets
for that class of that Fund's shares for the most recent preceding day for which
the net assets for that Fund were computed. The fee shall be payable as soon as
possible after the last day of each calendar month. In the case of termination
of this Agreement as to any class of a Participating Fund, the fees accrued for
such shares through the date of termination will be paid. The Series Distributor
waives any claim for Rule 12b-1 Fees in excess of the rates specified above.
2.2. The Series Distributor shall be entitled to no compensation for
services rendered and expenses borne as principal underwriter and distributor
other then as specified in this Section 2.
3. Authority of Series Distributor
Without limiting the foregoing, in its capacity as principal underwriter
and distributor, and acting as principal and not as agent for the Trust, the
Series Distributor is authorized, from time to time, to enter into separate
agreements with Manufacturers USA, with Manufacturers New York and with other
insurance companies authorized pursuant to Section 1 hereof, and with any broker
or other intermediary through whom a transaction is effected as to which the
Series Distributor is acting as principal underwriter hereunder, which
agreements may provide how much compensation out of any related Rule 12b-1
payments the Series Distributor will pay to any such company or person and how
much of such payments, if any, will be retained by the Series Distributor, in
each case, however, on terms and conditions not inconsistent with this Agreement
or the Rule 12b-1 Plan.
4. Compliance with Plans
Each party hereto agrees to comply with each provision of the Rule 12b-1
Plan or the Rule 18f-3 Plan (as they may be amended from time to time) that is
applicable to that party. The Trust agrees to advise the Series Distributor of
any change in either Plan.
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5. Furnishing Certain Information
Without limitation of any other provision of this Agreement, the parties
hereto agree, upon request, to furnish to the Trustees of the Trust such
information available to them that may be reasonably necessary (a) to evaluate
the Rule 18f-3 Plan (or any successor or proposed successor to that Plan) in
connection with any vote referred to in Rule 18f-3(d) or (b) to an informed
determination of whether the Rule 12b-1 Plan (or any successor or proposed
successor to such Plan), or any agreement related to such Plan, or any revisions
thereto, should be approved or continued. Also, the Series Distributor shall
furnish to the Trust, at least quarterly, reports as to the sales of Trust
shares made pursuant to this Agreement. Such reports shall be in writing and
include information on the amounts of Rule 12b-1 Fees expended for each Rule
12b-1 Class of each Participating Fund, the recipients of the Rule 12b-1 Fees
expended by the Series Distributor or by affiliated and unaffiliated insurance
companies, and the purposes for which such amounts were expended. Series
Distributor hereby authorizes Xxxx Xxxxxxx Life Insurance Company to deliver
these reports on the Series Distributor's behalf, if the Trustees of the Trust
so request.
These reports shall also include such information about expense
apportionments or allocations, fee or expense waivers for any classes, and
differences in shareholder voting patterns as among different classes of the
same Participating Fund, and other pertinent matters as the Trustees may
reasonably request.
6. Purchases and Redemptions of Shares
6.1. Purchases and redemptions of Series I and Series II shares of a
Participating Fund shall be at the net asset value therefore as described in the
Trust's prospectus and statement of additional information.
6.2. Sales, redemptions and repurchases shall be effected directly by the
transfer agent of the Trust, as such, according to the terms of the Trust's
transfer agency agreement, and payment for shares shall be transmitted by the
transfer agent directly to the Trust's custodian.
6.3. The Trust shall have the right to suspend the redemption of shares of
any of its Participating Funds pursuant to the conditions set forth in its
Prospectus and Statement of Additional Information. The Trust shall also have
the right to suspend the sale of shares of any or all of its Funds at any time
when it is authorized to suspend redemption of such shares. The Trustees of the
Trust also may refuse to sell shares of any Fund to any person, or suspend or
terminate the offering of shares of any Fund, if such action is required by law
or by regulatory authorities having jurisdiction or is, in the sole discretion
of the Trustees acting in good faith and in light of their fiduciary duties
under federal and any applicable state laws, in the best interests of such Fund
and its shareholders (including Variable Product owners).
6.4. The Trust will give the Series Distributor prompt notice of any such
suspension and shall promptly furnish such other information in connection with
the sale and redemption of Participating Fund shares as the Series Distributor
reasonably requests.
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6.5. Issuance and transfer of the Trust's shares will be by book entry
only. Share certificates will not be issued. Shares ordered from the Trust will
be recorded on the transfer records of the Trust in an appropriate title for
each shareholder.
7. Certain Documents and Expenses
7.1. The Trust will prepare and be responsible for filing with the SEC and
any state regulatory authorities requiring such filing all shareholder reports,
proxy materials and prospectuses and statements of additional information of the
Trust. The Trust will bear the costs of registration and qualification of the
shares of the Funds, preparation and filing of the documents listed in this
paragraph and all taxes to which an issuer is subject on the issuance and
transfer of its shares.
7.2. At the option of the Series Distributor, the Trust will either (a)
provide the Series Distributor with as many copies of the Trust's current
prospectus, statement of additional information, annual report, semi-annual
report, proxy materials and other shareholder communications, including any
amendments or supplements to any of the foregoing, as the Series Distributor may
reasonably request with respect to the Participating Funds; or (b) provide the
Series Distributor with camera ready copies of such documents in a form suitable
for printing. To the extent that the Series Distributor requests multiple copies
of documents pursuant to clause (a) above for marketing or other purposes, the
Series Distributor shall bear the cost of such multiple copies.
8. Sales Material and Information
8.1. The Series Distributor will use its best efforts to ensure that any
sales literature and other promotional material prepared by it or on its behalf
in which the Trust, a Fund, any investment adviser of subadviser to any Fund is
named, conforms to all requirements of all applicable federal and state laws and
rules and regulations, including all applicable rules and regulations of the
NASD.
8.2. The Series Distributor will not give any information or make any
representations or statements on behalf of the Trust or concerning the Trust in
connection with the sale of Fund shares, other than the information or
representations contained in the registration statement, prospectus or statement
of additional information for the Fund's shares, as such registration statement,
prospectus and statement of additional information may be amended or
supplemented from time to time, or in reports or proxy statements for the Trust,
or in sales literature or other promotional material approved in writing by the
Trust or its designee, except with the written approval of the Trust or its
designee.
8.3. The Trust will use its best efforts to ensure that sales literature
and other promotional material prepared by it or on its behalf in which the
Series Distributor is named, conform to all requirements of all applicable
federal rules and regulations of the NASD.
8.4. The Trust will not give any information or make any representations
or statements on behalf of or concerning the Series Distributor except with the
written permission of the Series Distributor or its designee.
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8.5. Each party hereto will provide to each other party, to the extent it
is relevant to the Contracts or the Trust, a copy of any comment letter received
from the staff of the United States Securities and Exchange Commission ("SEC")
or the NASD, and such party's response thereto, following any examination or
inspection by the staff of the SEC or the NASD.
8.6. As used herein, the phrase "sales literature and other promotional
material" includes, but is not limited to, advertisements (such as material
published or designed for use in a newspaper, magazine, or other periodical,
radio, television, telephone or tape recording, videotape display, sign or
billboard, motion picture or other public medium), sales literature (i.e., any
written communication distributed or made generally available to customers or
the public, including brochures, circulars, research reports, market letters,
form letters, seminar texts, reprints or excerpts of any other advertisement,
sales literature or published article), educational or training materials or
other communications distributed or made generally available to some or all
agents or employees.
9. Representations and Warranties
9.1. Representations and Warranties of the Series Distributor
(a) The Series Distributor represents and warrants that it is limited
liability company duly organized or existing and in good standing under
applicable law, and that, in discharging its functions hereunder, it will comply
in all material respects with all applicable federal and state laws.
(b) The Series Distributor represents and warrants that it will use
all reasonable efforts to avoid offering or selling shares of a Participating
Fund to any person or entity that is not (a) an insurance company that will hold
such shares in a "segregated asset account" within the meaning of Treas. Reg.
Section 1.817-5(e) through which public access to the Fund is available only
pursuant "variable contracts," within the meaning of Section 817(d) of the Code
or (b) other purchasers of the kind specified in Treas. Reg. Section
1.817-5(f)(3) as from time to time in effect; and the Series Distributor agrees
to promptly notify the Trust if it has reason to believe that Fund shares are
being held by or are being offered or sold to any person or entity not referred
to in clause (a) or (b) above.
9.2. Representations and Warranties of the Trust
(a) The Trust represents and warrants that it is lawfully organized
and validly existing under the laws of the Commonwealth of Massachusetts and
that it does and will at all times during the term of this Agreement comply in
all material respects with the 1940 Act.
(b) The Trust represents and warrants that shares of the
Participating Fund offered and sold pursuant to this Agreement will be
registered under the Securities Act of 1933 (the "1933 Act"), duly authorized
for issuance and sold in compliance with the laws of the Commonwealth of
Massachusetts and all applicable federal and state securities laws and that the
Trust is and will remain during the term of this Agreement registered as an
open-end management investment company under the 1940 Act. The Trust agrees that
it will amend the registration statement for a Participating Fund's shares under
the 1933 Act and the 1940 Act from time to time as required in order to permit
the continuous offering of its shares in
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accordance with the 1933 Act. The Trust will register and qualify the shares for
sale in accordance with the laws of the various states only if and to the extent
deemed advisable by the Trust or the Series Distributor.
(c) The Trust represents and warrants that the registration statement
for shares of a Participating Fund and any amendments or supplement thereto
will, when they become effective, conform in all material respects to the
requirements of the 1933 Act and the 1940 Act and the rules and regulations of
the SEC thereunder and will not contain any 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, provided, however, that this
representation and warranty will not apply to any statements or omissions made
in reliance upon and in conformity with information furnished in writing to the
Trust by or on behalf of the Series Distributor or any holder of the Trust's
shares expressly for use therein.
10. Notices
Any notice required under this Agreement shall be sufficiently given when
sent by registered or certified mail, by facsimile transmission (provided that a
copy is also sent by registered or certified mail) or by a nationally recognized
overnight delivery service, to the other party at the address of such party set
forth below or at such other address as such party may from time to time specify
in writing to the other party.
If to the Trust:
Xxxx Xxxxxxx Variable Series Trust I
Xxxx Xxxxxxx Xxxxx
X.X. Xxx 000
Xxxxxx, XX 000000
Attention: Xxxxxxx X. Xxxxx
Fax No.: (000) 000-0000
If to Series Distributor:
Manulife Financial Services, LLC
X.X. Xxx 0000
Xxxxxxx, XX 00000 - 4700
Attention: President
11. Continuation and Termination of this Agreement
11.1. This Agreement shall continue as to Series I and Series II classes of
a Participating Fund's shares for a period of more than one year after it takes
effect as to that class of that Fund only so long as such continuance is
specifically approved as to that class of that Fund at least annually by votes
of the majority of (a) the Trustees and (b) the Independent Trustees of the
Trust cast in person at a meeting called for the purpose of voting on such
continuance.
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11.2. This Agreement shall terminate automatically in the event of its
assignment.
11.3. This Agreement may be terminated at any time with respect to any
class of a Participating Fund's shares, without payment of any penalty, by vote
of a majority of the Independent Trustees or by vote of a majority of the
outstanding voting securities representing that class of that Fund's shares, or
by the Series Distributor, on 60 days' written notice to any other parties
hereto.
11.4. Termination of this Agreement as to any Participating Fund or class
of shares thereof shall not be deemed to extinguish any claim arising prior to
such termination for breach of this Agreement or breach of any representation or
warrantee herein.
12. Definitions
As used in this agreement, (a) the term "Independent Trustees" shall mean
those Trustees of the Trust who are not interested persons of the Trust, and
have no direct or indirect financial interest in the operation of the Rule 12b-1
Plan or any agreements related to it, and (b) the terms "assignment" and
"interested person" shall have the respective meanings specified in the 1940 Act
and the rules and regulations thereunder, subject to such exemptions or
interpretations as may be granted or issued by the SEC.
13. Miscellaneous
13.1. The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights, remedies and obligations,
at law or in equity, to which the parties hereto are entitled or subject under
state and federal laws.
13.2. This Agreement is executed on behalf of the Trustees of the Trust as
Trustees and not individually, and the obligations of or arising out of this
Agreement are not binding upon any of the Trustees or shareholders individually
but are binding only upon the assets and property of the respective class of
each Participating Fund.
13.3. This Agreement may be executed in two or more counterparts which
together will constitute one and the same instrument.
13.4. If any provision of this Agreement is held or made invalid by a court
decision, statute, rule or otherwise, the remainder of the Agreement will not be
affected thereby.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
XXXX XXXXXXX VARIABLE SERIES TRUST I
By:
-------------------------------------
Name
Title:
MANULIFE FINANCIAL SECURITIES LLC
By: The Manufacturers Life Insurance
Company (U.S.A.)
Its Managing Member
By:
-------------------------------------
Name:
-----------------------------------
Title:
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APPENDIX A
to
Distribution Agreement Dated as of May 1, 2004
Between Xxxx Xxxxxxx Variable Series Trust I (the "Trust")
and Manulife Financial Services LLC
The portfolios of the Trust that are deemed to be "Participating Funds," and to
which the above-captioned Agreement therefore pertains, are as follows:
International Equity Index Fund
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