Exhibit No. 5(b)
PAINEWEBBER INDEX TRUST
DISTRIBUTION CONTRACT
CLASS C SHARES
CONTRACT made as of _____________________, 1998 between PAINEWEBBER INDEX
TRUST, a Delaware business trust ("Fund"), and XXXXXXXX XXXXXXXX ASSET
MANAGEMENT INC., a Delaware corporation ("Xxxxxxxx Xxxxxxxx").
WHEREAS the Fund is registered under the Investment Company Act of l940, as
amended ("l940 Act"), as an open-end management investment company and currently
has four distinct series of shares of beneficial interest ("Series"), which
correspond to distinct portfolios and have been designated as PaineWebber Bond
Index Fund, PaineWebber EAFE Index Fund, PaineWebber S&P 500 Index Fund and
PaineWebber Small Cap Index Fund; and
WHEREAS the Fund's board of trustees ("Board") has established an unlimited
number of shares of beneficial interest of the above-referenced Series as Class
C shares ("Class C Shares"); and
WHEREAS the Fund has adopted a Plan of Distribution pursuant to Rule 12b-1
under the 1940 Act for its Class C Shares ("Plan") and desires to retain
Xxxxxxxx Xxxxxxxx as principal distributor in connection with the offering and
sale of the Class C Shares of the above-referenced Series and of such other
Series as may hereafter be designated by the Board and have Class C Shares
established; and
WHEREAS Xxxxxxxx Xxxxxxxx is willing to act as principal distributor of the
Class C Shares of each such Series on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. Appointment. The Fund hereby appoints Xxxxxxxx Xxxxxxxx as its exclusive
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agent to be the principal distributor to sell and to arrange for the sale of the
Class C Shares on the terms and for the period set forth in this Contract.
Xxxxxxxx Xxxxxxxx hereby accepts such appointment and agrees to act hereunder.
It is understood, however, that this appointment does not preclude sales of the
Class C Shares directly through the Fund's transfer agent in the manner set
forth in the Registration Statement. As used in this Contract, the term
"Registration Statement" shall mean the currently effective registration
statement of the Fund, and any supplements thereto, under the Securities Act of
1933, as amended ("1933 Act"), and the 1940 Act.
2. Services and Duties of Xxxxxxxx Xxxxxxxx.
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(a) Xxxxxxxx Xxxxxxxx agrees to sell Class C Shares on a best efforts
basis from time to time during the term of this Contract as agent for the
Fund and upon the terms described in the Registration Statement.
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(b) Upon the later of the date of this Contract or the initial offering of
the Class C Shares to the public by a Series, Xxxxxxxx Xxxxxxxx will hold itself
available to receive purchase orders, satisfactory to Xxxxxxxx Xxxxxxxx, for
Class C Shares of that Series and will accept such orders on behalf of the Fund
as of the time of receipt of such orders and promptly transmit such orders as
are accepted to the Fund's transfer agent. Purchase orders shall be deemed
effective at the time and in the manner set forth in the Registrati on
Statement.
(c) Xxxxxxxx Xxxxxxxx in its discretion may enter into agreements to
sell Class C Shares to such registered and qualified retail dealers, including
but not limited to PaineWebber Incorporated ("PaineWebber"), as it may select.
In making agreements with such dealers, Xxxxxxxx Xxxxxxxx shall act only as
principal and not as agent for the Fund.
(d) The offering price of the Class C Shares of each Series shall be the
net asset value per Share as next determined by the Fund following receipt of an
order at Xxxxxxxx Xxxxxxxx' principal office. The Fund shall promptly furnish
Xxxxxxxx Xxxxxxxx with a statement of each computation of net asset value.
(e) Xxxxxxxx Xxxxxxxx shall not be obligated to sell any certain number of
Class C Shares.
(f) To facilitate redemption of Class C Shares by shareholders directly or
through dealers, Xxxxxxxx Xxxxxxxx is authorized but not required on behalf of
the Fund to repurchase Class C Shares presented to it by shareholders and
dealers at the price determined in accordance with, and in the manner set forth
in, the Registration Statement. Such price shall reflect the subtraction of the
contingent deferred sales charge, if any, computed in accordance with and in the
manner set forth in the Registration Statement.
(g) Xxxxxxxx Xxxxxxxx shall provide ongoing shareholder services, which
include responding to shareholder inquiries, providing shareholders with
information on their investments in the Class C Shares and any other services
now or hereafter deemed to be appropriate subjects for the payments of "service
fees" under Rule 2830 of the Conduct Rules of the National Association of
Securities Dealers, Inc. ("NASD") (collectively, "service activities").
(h) Xxxxxxxx Xxxxxxxx shall have the right to use any list of shareholders
of the Fund or any other list of investors which it obtains in connection with
its provision of services under this Contract; provided, however, that Xxxxxxxx
Xxxxxxxx shall not sell or knowingly provide such list or lists to any
unaffiliated person.
3. Authorization to Enter into Exclusive Dealer Agreements and to Delegate
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Duties as Distributor. With respect to the Class C Shares of any or all Series,
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Xxxxxxxx Xxxxxxxx may enter into an exclusive dealer agreement with PaineWebber
or any other registered and qualified dealer with respect to sales of the Class
C Shares or the provision of service activities. In a separate contract or as
part of any such exclusive dealer agreement, Xxxxxxxx Xxxxxxxx also may delegate
to PaineWebber or another registered and qualified dealer ("sub-distributor")
any or all of its duties specified in this Contract, provided that such separate
contract or exclusive dealer agreement imposes on the sub-distributor bound
thereby all applicable duties and conditions to
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which Xxxxxxxx Xxxxxxxx is subject under this Contract, and further provided
that such separate contract or exclusive dealer agreement meets all requirements
of the 1940 Act and rules thereunder.
4. Services Not Exclusive. The services furnished by Xxxxxxxx Xxxxxxxx
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hereunder are not to be deemed exclusive and Xxxxxxxx Xxxxxxxx shall be free to
furnish similar services to others so long as its services under this Contract
are not impaired thereby. Nothing in this Contract shall limit or restrict the
right of any director, officer or employee of Xxxxxxxx Xxxxxxxx, who may also be
a trustee, officer or employee of the Fund, to engage in any other business or
to devote his or her time and attention in part to the management or other
aspects of any other business, whether of a similar or a dissimilar nature.
5. Compensation.
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(a) As compensation for its service activities under this contract with
respect to the Class C Shares, Xxxxxxxx Xxxxxxxx shall receive from the Fund a
service fee at the rate and under the terms and conditions of the Plan adopted
by the Fund with respect to the Class C Shares of the Series, as such Plan is
amended from time to time, and subject to any further limitations on such fee as
the Board may impose.
(b) As compensation for its activities under this contract with respect to
the distribution of the Class C Shares, Xxxxxxxx Xxxxxxxx shall receive from the
Fund a distribution fee at the rate and under the terms and conditions of the
Plan adopted by the Fund with respect to the Class C Shares of the Series, as
such Plan is amended from time to time, and subject to any further limitations
on such fee as the Board may impose.
(c) As compensation for its activities under this contract with respect
to the distribution of the Class C Shares, Xxxxxxxx Xxxxxxxx shall receive all
contingent deferred sales charges imposed on redemptions of Class C Shares
of each Series. Whether and at what rate a contingent deferred sales
charge will be imposed with respect to a redemption shall be determined in
accordance with, and in the manner set forth in, the Registration
Statement.
(d) Xxxxxxxx Xxxxxxxx may reallow any or all of the distribution fees,
contingent deferred sales charges, or service fees which it is paid under
this Contract to such dealers as Xxxxxxxx Xxxxxxxx may from time to time
determine.
6. Duties of the Fund.
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(a) The Fund reserves the right at any time to withdraw offering Class C
Shares of any or all Series by written notice to Xxxxxxxx Xxxxxxxx at its
principal office.
(b) The Fund shall determine in its sole discretion whether certificates
shall be issued with respect to the Class C Shares. If the Fund has
determined that certificates shall be issued, the Fund will not cause
certificates representing Class C Shares to be issued unless so requested
by shareholders. If such request is transmitted by Xxxxxxxx Xxxxxxxx, the
Fund will cause certificates evidencing Class C Shares to be issued in such
names and denominations as Xxxxxxxx Xxxxxxxx shall from time to time
direct.
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(c) The Fund shall keep Xxxxxxxx Xxxxxxxx fully informed of its affairs
and shall make available to Xxxxxxxx Xxxxxxxx copies of all information,
financial statements, and other papers which Xxxxxxxx Xxxxxxxx may
reasonably request for use in connection with the distribution of Class C
Shares, including, without limitation, certified copies of any financial
statements prepared for the Fund by its independent public accountant and
such reasonable number of copies of the most current prospectus, statement
of additional information, and annual and interim reports of any Series as
Xxxxxxxx Xxxxxxxx may request, and the Fund shall cooperate fully in the
efforts of Xxxxxxxx Xxxxxxxx to sell and arrange for the sale of the Class
C Shares of the Series and in the performance of Xxxxxxxx Xxxxxxxx under
this Contract.
(d) The Fund shall take, from time to time, all necessary action, including
payment of the related filing fee, as may be necessary to register the Class C
Shares under the 1933 Act to the end that there will be available for sale such
number of Class C Shares as Xxxxxxxx Xxxxxxxx may be expected to sell. The Fund
agrees to file, from time to time, such amendments, reports, and other documents
as may be necessary in order that there will be no untrue statement of a
material fact in the Registration Statement, nor any omission of a material fact
which omission would make the statements therein misleading.
(e) The Fund shall use its best efforts to qualify and maintain the
qualification of an appropriate number of Class C Shares of each Series for
sale under the securities laws of such states or other jurisdictions as
Xxxxxxxx Xxxxxxxx and the Fund may approve, and, if necessary or
appropriate in connection therewith, to qualify and maintain the
qualification of the Fund as a broker or dealer in such jurisdictions;
provided that the Fund shall not be required to amend its Trust Instrument
or By-Laws to comply with the laws of any jurisdiction, to maintain an
office in any jurisdiction, to change the terms of the offering of the
Class C Shares in any jurisdiction from the terms set forth in its
Registration Statement, to qualify as a foreign corporation in any
jurisdiction, or to consent to service of process in any jurisdiction other
than with respect to claims arising out of the offering of the Class C
Shares. Xxxxxxxx Xxxxxxxx shall furnish such information and other
material relating to its affairs and activities as may be required by the
Fund in connection with such qualifications.
7. Expenses of the Fund. The Fund shall bear all costs and expenses of
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registering the Class C Shares with the Securities and Exchange Commission and
qualifying the Class C shares with state and other regulatory bodies, and shall
assume expenses related to communications with shareholders of each Series,
including (i) fees and disbursements of its counsel and independent public
accountant; (ii) the preparation, filing and printing of registration statements
and/or prospectuses or statements of additional information required under the
federal securities laws; (iii) the preparation and mailing of annual and interim
reports, prospectuses, statements of additional information and proxy materials
to shareholders; and (iv) the qualifications of Class C Shares for sale and of
the Fund as a broker or dealer under the securities laws of such jurisdictions
as shall be selected by the Fund and Xxxxxxxx Xxxxxxxx pursuant to Paragraph
6(e) hereof, and the costs and expenses payable to each such jurisdiction for
continuing qualification therein.
8. Expenses of Xxxxxxxx Xxxxxxxx. Xxxxxxxx Xxxxxxxx shall bear all costs and
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expenses of (i) preparing, printing and distributing any materials not prepared
by the Fund and other
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materials used by Xxxxxxxx Xxxxxxxx in connection with the
sale of Class C Shares under this Contract, including the additional cost of
printing copies of prospectuses, statements of additional information, and
annual and interim shareholder reports other than copies thereof required for
distribution to existing shareholders or for filing with any federal or state
securities authorities; (ii) any expenses of advertising incurred by Xxxxxxxx
Xxxxxxxx in connection with such offering; (iii) the expenses of registration or
qualification of Xxxxxxxx Xxxxxxxx as a broker or dealer under federal or state
laws and the expenses of continuing such registration or qualification; and (iv)
all compensation paid to Xxxxxxxx Xxxxxxxx' employees and others for selling
Class C Shares, and all expenses of Xxxxxxxx Xxxxxxxx, its employees and others
who engage in or support the sale of Class C Shares as may be incurred in
connection with their sales efforts.
9. Indemnification.
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(a) The Fund agrees to indemnify, defend and hold Xxxxxxxx Xxxxxxxx, its
officers and directors, and any person who controls Xxxxxxxx Xxxxxxxx
within the meaning of Section 15 of the 1933 Act, 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
Xxxxxxxx Xxxxxxxx, its officers, directors or any such controlling person
may incur under the 1933 Act, or under common law or otherwise, arising out
of or based upon any alleged untrue statement of a material fact contained
in the Registration Statement or arising out of or based upon any alleged
omission to state a material fact required to be stated in the Registration
Statement or necessary to make the statements therein not misleading,
except insofar as such claims, demands, liabilities or expenses arise out
of or are based upon any such untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with
information furnished in writing by Xxxxxxxx Xxxxxxxx to the Fund for use
in the Registration Statement; provided, however, that this indemnity
agreement shall not inure to the benefit of any person who is also an
officer or trustee of the Fund or who controls the Fund within the meaning
of Section 15 of the 1933 Act, unless a court of competent jurisdiction
shall determine, or it shall have been determined by controlling precedent,
that such result would not be against public policy as expressed in the
1933 Act; and further provided, that in no event shall anything contained
herein be so construed as to protect Xxxxxxxx Xxxxxxxx against any
liability to the Fund or to the shareholders of any Series to which
Xxxxxxxx Xxxxxxxx would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of its duties
or by reason of its reckless disregard of its obligations under this
Contract. The Fund shall not be liable to Xxxxxxxx Xxxxxxxx under this
indemnity agreement with respect to any claim made against Xxxxxxxx
Xxxxxxxx or any person indemnified unless Xxxxxxxx Xxxxxxxx or other such
person shall have notified the Fund in writing of the claim within a
reasonable time after the summons or other first written notification
giving information of the nature of the claim shall have been served upon
Xxxxxxxx Xxxxxxxx or such other person (or after Xxxxxxxx Xxxxxxxx or the
person shall have received notice of service on any designated agent).
However, failure to notify the Fund of any claim shall not relieve the Fund
from any liability which it may have to Xxxxxxxx Xxxxxxxx or any person
against whom such action is brought otherwise than on account of this
indemnity agreement. The Fund shall be entitled to participate at its own
expense in the defense or, if it so elects, to assume the defense of any
suit brought to enforce any claims subject to this indemnity agreement. If
the Fund elects to assume the defense of any such claim, the defense shall
be conducted by counsel chosen by the Fund and
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satisfactory to indemnified defendants in the suit whose approval shall not be
unreasonably withheld. In the event that the Fund elects to assume the defense
of any suit and retain counsel, the indemnified defendants shall bear the fees
and expenses of any additional counsel retained by them. If the Fund does not
elect to assume the defense of a suit, it will reimburse the indemnified
defendants for the reasonable fees and expenses of any counsel retained by the
indemnified defendants. The Fund agrees to notify Xxxxxxxx Xxxxxxxx promptly of
the commencement of any litigation or proceedings against it or any of its
officers or trustees in connection with the issuance or sale of any of its Class
C Shares.
(b) Xxxxxxxx Xxxxxxxx agrees to indemnify, defend, and hold the Fund, its
officers and trustees and any person who controls the Fund within the
meaning of Section 15 of the 1933 Act, free and harmless from and against
any and all claims, demands, liabilities and expenses (including the cost
of investigating or defending against such claims, demands or liabilities
and any counsel fees incurred in connection therewith) which the Fund, its
trustees or officers, or any such controlling person may incur under the
1933 Act or under common law or otherwise arising out of or based upon any
alleged untrue statement of a material fact contained in information
furnished in writing by Xxxxxxxx Xxxxxxxx to the Fund for use in the
Registration Statement, arising out of or based upon any alleged omission
to state a material fact in connection with such information required to be
stated in the Registration Statement necessary to make such information not
misleading, or arising out of any agreement between Xxxxxxxx Xxxxxxxx and
any retail dealer, or arising out of any supplemental sales literature or
advertising used by Xxxxxxxx Xxxxxxxx in connection with its duties under
this Contract. Xxxxxxxx Xxxxxxxx shall be entitled to participate, at its
own expense, in the defense or, if it so elects, to assume the defense of
any suit brought to enforce the claim, but if Xxxxxxxx Xxxxxxxx elects to
assume the defense, the defense shall be conducted by counsel chosen by
Xxxxxxxx Xxxxxxxx and satisfactory to the indemnified defendants whose
approval shall not be unreasonably withheld. In the event that Xxxxxxxx
Xxxxxxxx elects to assume the defense of any suit and retain counsel, the
defendants in the suit shall bear the fees and expenses of any additional
counsel retained by them. If Xxxxxxxx Xxxxxxxx does not elect to assume
the defense of any suit, it will reimburse the indemnified defendants in
the suit for the reasonable fees and expenses of any counsel retained by
them.
10. Limitation of Liability of the Trustees and Shareholders of the Fund.
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The trustees of the Fund and the shareholders of any Series shall not be liable
for any obligations of the Fund or any Series under this Contract, and Xxxxxxxx
Xxxxxxxx agrees that, in asserting any rights or claims under this Contract, it
shall look only to the assets and property of the Fund or the particular Series
in settlement of such right or claims, and not to such trustees or shareholders.
11. Services Provided to the Fund by Employees of Xxxxxxxx Xxxxxxxx. Any
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person, even though also an officer, director, employee or agent of Xxxxxxxx
Xxxxxxxx, who may be or become an officer, trustee, employee or agent of the
Fund, shall be deemed, when rendering services to the Fund or acting in any
business of the Fund, to be rendering such services to or acting solely for the
Fund and not as an officer, director, employee or agent or one under the control
or direction of Xxxxxxxx Xxxxxxxx even though paid by Xxxxxxxx Xxxxxxxx.
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12. Duration and Termination.
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(a) This Contract shall become effective upon the date written above,
provided that, with respect to any Series, this Contract shall not take effect
unless such action has first been approved by vote of a majority of the Board
and by vote of a majority of those trustees of the Fund who are not interested
persons of the Fund, and have no direct or indirect financial interest in the
operation of the Plan relating to the Series or in any agreements related
thereto (all such trustees collectively being referred to herein as the
"Independent Trustees"), cast in person at a meeting called for the purpose of
voting on such action.
(b) Unless sooner terminated as provided herein, this Contract shall
continue in effect for one year from the above written date. Thereafter, if not
terminated, this Contract shall continue automatically for successive periods of
twelve months each, provided that such continuance is specifically approved at
least annually (i) by a vote of a majority of the Independent Trustees, cast in
person at a meeting called for the purpose of voting on such approval, and (ii)
by the Board or with respect to any given Series by vote of a majority of the
outstanding voting securities of the Class C Shares of such Series.
(c) Notwithstanding the foregoing, with respect to any Series, this
Contract may be terminated at any time, without the payment of any penalty, by
vote of the Board, by vote of a majority of the Independent Trustees or by vote
of a majority of the outstanding voting securities of the Class C Shares of such
Series on sixty days' written notice to Xxxxxxxx Xxxxxxxx or by Xxxxxxxx
Xxxxxxxx at any time, without the payment of any penalty, on sixty days' written
notice to the Fund or such Series. This Contract will automatically terminate in
the event of its assignment.
(d) Termination of this Contract with respect to any given Series shall
in no way affect the continued validity of this Contract or the performance
thereunder with respect to any other Series.
13. Amendment of this Contract. No provision of this Contract may be
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changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
14. Governing Law. This Contract shall be construed in accordance with the
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laws of the State of Delaware and the 1940 Act. To the extent that the
applicable laws of the State of Delaware conflict with the applicable provisions
of the l940 Act, the latter shall control.
15. Notice. Any notice required or permitted to be given by either party to
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the other shall be deemed sufficient upon receipt in writing at the other
party's principal offices.
16. Miscellaneous. The captions in this Contract are included for
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convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Contract shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Contract shall not be affected
thereby. This Contract shall be binding upon and shall inure to the benefit of
the parties hereto
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and their respective successors. As used in this Contract,
the terms "majority of the outstanding voting securities," "interested person"
and "assignment" shall have the same meaning as such terms have in the l940 Act.
IN WITNESS WHEREOF, the parties hereto have caused this Contract to be
executed by their officers designated as of the day and year first above
written.
ATTEST: PAINEWEBBER INDEX TRUST
------------------- By:--------------------
ATTEST: XXXXXXXX XXXXXXXX ASSET
MANAGEMENT INC.
------------------ By:--------------------
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