DISTRIBUTION AGREEMENT
THIS AGREEMENT is made as of this 13th day of February 2004, by and
between Cadre Institutional Investors Trust (the "Trust"), a business trust
organized under the laws of the State of Delaware, and PFMAM, Inc. (the
"Distributor"), a corporation organized under the laws of the State of
Pennsylvania.
WHEREAS, the Trust is registered as an open-end, diversified management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and is currently offering shares of beneficial interest ("Shares")
of investment portfolios of the Trust, which are identified on Schedule A
hereto, as from time to time amended (the "Funds"), and are registered under the
Securities Act of 1933 with the Securities and Exchange Commission ("SEC")
pursuant to the Trust's Registration Statement on Form N-lA, as amended (the
"Registration Statement").
NOW, THEREFORE, in consideration of the premises and mutual covenants set
forth herein and intending to be legally bound hereby, the Trust and Distributor
agree as follows:
1. SERVICE AS DISTRIBUTOR
1.1. The Distributor will act on behalf of the Trust for the
distribution of the Shares covered by the Registration Statement under the
Securities Act of 1933, as amended (the "1933 Act"). The Distributor will have
no liability for payment for the purchase of Shares sold pursuant to this
Agreement or with respect to redemptions or repurchases of Shares.
1.2. The Distributor agrees to use such efforts as is deemed
appropriate by the Distributor to solicit orders for the sale of the Shares and
to undertake such advertising and promotion and other activities as it believes
reasonable in connection with such solicitation. The Trust understands that the
Distributor may serve as the distributor of the shares of other investment
companies and series thereof (collectively, the "Companies"), including
Companies having investment objectives similar to those of the Trust. The Trust
further understands that investors and potential investors in the Trust may
invest in shares of such other Companies. The Trust agrees that the
Distributor's duties to such Companies shall not be deemed in conflict with its
duties to the Trust under this paragraph 1.2.
1.3. The Distributor shall, at its own expense, finance appropriate
activities which it deems reasonable which are primarily intended to result in
the sale of the Shares, including, but not limited to, the payment of
compensation to brokers, dealers and other financial institutions which make
shares available to their customers (collectively, "Dealers"), the payment of
compensation to sales personnel of the Distributor, and the printing and mailing
of prospectuses to other than current shareholders.
1.4. All activities by the Distributor and its agents and employees,
as distributor of the Shares, shall comply with all applicable laws, rules and
regulations, including, without limitation, all rules and regulations made or
adopted by the SEC and the National Association of Securities Dealers.
1.5. The Distributor will transmit any orders received by it for
purchase or redemption of the Shares to the transfer agent for the Trust.
1.6. Whenever in its judgment such action is warranted by unusual
market, economic or political conditions, the Trust may decline to accept any
orders for, or make any sales of, the Shares until such time as the Trust deems
it advisable to accept such orders and to make such sales.
1.7. The Trust agrees at its own expense to execute any and all
documents and to furnish any and all information and otherwise to take all
actions that may be reasonably necessary in connection with the qualification of
the Shares for sale in such states as the Distributor may designate.
1.8. The Trust shall furnish from time to time, for use in
connection with the sale of the Shares, such information with respect to the
Trust and the Shares as the Distributor may reasonably request; and the Trust
warrants that the statements contained in any such information shall fairly show
or represent what they purport to show or represent. The Trust shall also
furnish the Distributor upon request with: (a) audited annual statements and
unaudited semi-annual statements of each Fund's books and accounts prepared by
the Trust, (b) quarterly earnings statements prepared by the Trust, (c) a
monthly itemized list of the securities comprising the portfolio of each Fund,
(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 financial
condition of the Trust and the Funds as the Distributor may reasonably request.
1.9. The Trust represents to the Distributor that all Registration
Statements and prospectuses filed by the Trust with the SEC under the 1933 Act
with respect to the Shares have been prepared in conformity with the
requirements of said Act and the rules and regulations of the SEC thereunder. As
used in this Agreement, the term "Registration Statement" shall mean any
Registration Statement and any prospectus and any statement of additional
information relating to the Trust filed with the SEC and any amendments or
supplements thereto at any time filed with the SEC. Except as to information
included in the Registration Statement in reliance upon information provided to
the Trust by the Distributor or any affiliate of the Distributor, the Trust
represents and warrants to the Distributor that: any Registration Statement,
when such Registration Statement becomes effective, will contain statements
required to be stated therein in conformity with the 1933 Act and the rules and
regulations of the SEC thereunder; all statements of fact contained in any such
Registration Statement will be true and correct when such Registration Statement
becomes effective; and no Registration Statement 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 to a purchaser of the Shares. The
Trust, 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 Trust's counsel, be necessary or advisable. The Trust shall
promptly notify the Distributor of any advice given to it by its counsel
regarding the necessity or advisability of amending or supplementing such
Registration Statement. If the Trust shall not propose such amendment or
amendments and/or supplement or supplements within fifteen days after receipt by
the Trust of a written request from the Distributor to do so, the Distributor
may, at its option, terminate this Agreement. The Trust shall not file any
amendment to any Registration Statement or supplement to any prospectus without
giving the Distributor reasonable notice thereof in advance; provided, however,
that nothing contained in this Agreement shall in any way limit the Trust's
right to file at any time such amendments to any Registration Statements and/or
supplements to any prospectus, of whatever character, as the Trust may deem
advisable, such right being in all respects absolute and unconditional.
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1.10. The Trust authorizes the Distributor and Dealers to use any
prospectus or statement of additional information in the form furnished from
time to time in connection with the sale of the Shares. The Trust agrees to
indemnify and hold harmless the Distributor, its officers, directors, and
employees, and any person who controls the Distributor 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 legal fees incurred in
connection therewith) which the Distributor, its officers, directors, employees
or any such controlling person may incur under the 1933 Act, under any other
statute, at common law or otherwise, arising out of or based upon:
(a) any untrue statement, or alleged untrue statement, of a
material fact contained in the Trust's Registration Statement, prospectus,
statement of additional information, or sales literature (including amendments
and supplements thereto), or
(b) any omission, or alleged omission, to state a material
fact required to be stated in the Trust's Registration Statement, prospectus,
statement of additional information or sales literature (including amendments or
supplements thereto), necessary to make the statements therein not misleading,
provided, however, that insofar as losses, claims, damages, 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 on and in conformity with
information furnished to the Trust by the Distributor or its affiliated persons
for use in the Trust's Registration Statement, prospectus, or statement of
additional information or sales literature (including amendments or supplements
thereto), such indemnification is not applicable.
The Distributor, its officers, directors, and employees, and any
such controlling person, as aforesaid, shall notify the Trust of any action
brought against the Distributor, its officers, directors or employees, or any
such controlling person, such notification to be given by letter or by telegram
addressed to the Trust and sent to the Trust by the person against whom such
action is brought, within 10 days after the summons or other first legal process
shall have been served. The failure to notify the Trust of any such action shall
not relieve the Trust from any liability which the Trust may have to the person
against whom such action is brought by reason of any such untrue, or allegedly
untrue, statement or omission, or alleged omission, otherwise than on account of
the Trust's indemnity agreement contained in this paragraph 1.10. The Trust 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 Trust and approved by the Distributor,
which approval shall not unreasonably be withheld. In the event the Trust elects
to assume the defense of any such suit and retain counsel of good standing
approved by the Distributor, 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 Trust does not elect to assume the defense of any such suit, or in case
the Distributor reasonably does not approve of counsel chosen by the Trust, or
in case there is a conflict of interest between the Trust or the Distributor,
the Trust will reimburse the Distributor, its officers, directors and employees,
or the controlling person or persons named as defendant or defendants in such
suit, for the fees and expenses of any counsel retained by the Distributor or
them. The Trust's indemnification agreement contained in this paragraph 1.10 and
the Trust'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 the Distributor, its officers, directors and employees, or any
controlling person, and shall survive the delivery of any Shares. This agreement
of indemnity will inure exclusively to the Distributor's benefit, to the benefit
of its several officers, directors and employees, and their respective estates,
and to the benefit of the controlling persons and their successors. The Trust
agrees promptly to notify the Distributor of the commencement of any litigation
or proceedings against the Trust or any of its officers or trustees in
connection with the issue and sale of any Shares.
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1.11. The Distributor agrees to indemnify and hold harmless the
Trust, its several officers and trustees and each person, if any, who controls
the Trust or a Fund within the meaning of Section 15 of the 1933 Act against any
loss, claims, damages, liabilities and expenses (including the cost of any
reasonable legal fees incurred in connection therewith) which the Trust, its
officers, trustees or any such controlling person may incur under the 1933 Act,
under any other statute, at common law or otherwise, but only to the extent that
such liability or expense incurred by the Trust, its officers or trustees, or
any controlling person resulting from such claims or demands arose out of the
acquisition of any Shares by any person which may be based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Trust's Registration Statement, prospectus or statement of additional
information (including amendments and supplements thereto), or any omission, or
alleged omission, to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, if such statement or
omission was made in reliance upon information furnished or confirmed in writing
to the Trust by the Distributor or its affiliated persons (as defined in the
1940 Act).
The agreement of the Distributor to indemnify the Trust, its
officers and trustees, and any such controlling person, as aforesaid, is
expressly conditioned upon the Distributor being notified of any action brought
against the Trust, its officers or trustees, or any such controlling person,
such notification to be given by letter or telegram addressed to the Distributor
at its principal office, and sent to the Distributor by the person against whom
such action is brought, within 10 days after the summons or other first legal
process shall have been served. The Distributor shall have the right of first
control of the defense of such action, with counsel of its own choosing,
satisfactory to the Trust, if such action is based solely upon such alleged
misstatement or omission on the Distributor's part, and in any other event the
Trust, its officers or trustees 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 to so notify the Distributor of any such action shall not
relieve the Distributor from any liability that the Distributor may have to the
Trust, its officers or trustees, 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 the Distributor's indemnity agreement contained in
this paragraph 1.11.
1.12. No Shares shall be offered by either the Distributor or the
Trust under any of the provisions of this Agreement and no orders for the
purchase or sale of Shares hereunder shall be accepted by the Trust if and so
long as effectiveness of the Registration Statement then in effect or any
necessary amendments thereto shall be suspended under any of the provisions of
the 1933 Act, or if and so long as a current prospectus as required by Section
5(b)(2) of said Act is not on file with the SEC; provided, however, that nothing
contained in this paragraph 1.12 shall in any way restrict or have any
application to or bearing upon the Trust's obligation to redeem Shares tendered
for redemption by any shareholder in accordance with the provisions of the
Trust's Registration Statement, Declaration of Trust, or bylaws.
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1.13. The Trust agrees to advise the Distributor as soon as
reasonably practical by a notice in writing delivered to the Distributor:
(a) of any request by the SEC for amendments to the
Registration Statement, prospectus or statement of additional information then
in effect or for additional information;
(b) in the event of the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement, prospectus or
statement of additional information then in effect or the initiation by service
of process on the Trust of any proceeding for that purpose;
(c) of the happening of any event that makes untrue any
statement of a material fact made in the Registration Statement, prospectus or
statement of additional information then in effect or that requires the making
of a change in such Registration Statement, prospectus or statement of
additional information in order to make the statements therein not misleading;
and
(d) of all actions of the SEC with respect to any amendments
to any Registration Statement, prospectus or statement of additional information
which may from time to time be filed with the SEC.
For purposes of this Section, informal requests by or acts of the Staff of the
SEC shall not be deemed actions of or requests by the SEC.
1.14. The Distributor may enter into selling agreements with Dealers
with respect to the offering of the Shares to the public. Each such selling
agreement will provide (a) that all payments for purchases of Shares will be
sent directly from the Dealer to the Funds', custodian account, (b) that the
Dealer will notify the transfer agent for the Trust of the purchase of Shares
and (c) that, if payment is not made with respect to purchases of Shares at the
customary or required time for settlement of the transaction, the Distributor
will have the right to cancel the sale of the Shares ordered by the Dealer, in
which case the Dealer will be responsible for any loss suffered by any Fund or
the Distributor resulting from such cancellation. The Distributor may also act
as disclosed agent for a Fund and sell Shares of that Fund to individual
investors. The Distributor shall enter into selling agreements only with Dealers
that are either members in good standing of the National Association of
Securities Dealers, Inc. or entities that are not required to be such members.
All selling agreements shall be in such form as is approved by the President of
the Trust.
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2. TERM
This Agreement shall become effective on the date hereof, and,
unless sooner terminated as provided herein, shall continue for an initial two
year term from the date of its execution and shall continue in effect from year
to year thereafter, provided that such continuance is specifically approved at
least annually by (i) the Trust's Board of Trustees or (ii) by a vote of a
majority (as defined in the 1940 Act and Rule 18f-2 thereunder) of the
outstanding voting securities of the Trust, and further provided that in either
event the continuance is also approved by a majority of the Trustees who are not
parties to this Agreement and who are not interested persons (as defined in the
0000 Xxx) of any party to this Agreement, by vote cast in person at a meeting
called for the purpose of voting on such approval. This Agreement is terminable
without penalty, on at least sixty days' written notice, by the Trust's Board of
Trustees, by vote of a majority (as defined in the 1940 Act and Rule 18f-2
thereunder) of the outstanding voting securities of the Trust, or by the
Distributor. This Agreement shall terminate automatically in the event of its
assignment (as defined in the 1940 Act and the rules thereunder).
3. LIMITATION OF LIABILITY
(a) The Distributor shall not be liable to the Trust for any error
of judgment or mistake of law or for any loss suffered by the Trust in
connection with the performance of its obligations and duties under this
Agreement, except a loss resulting from the Distributor's willful misfeasance,
bad faith or gross negligence in the performance of such obligations and duties,
or by reason of its reckless disregard thereof. The Trust will indemnify the
Distributor against and hold it harmless from any and all losses, claims,
damages, liabilities or expenses (including reasonable counsel fees and
expenses) resulting from any claim, demand, action or suit not resulting from
the willful misfeasance, bad faith or gross negligence of the Distributor in the
performance of such obligations and duties or by reason of its reckless
disregard thereof.
(b) In no event and under no circumstances shall either party to
this Agreement be liable to the other party for consequential or indirect loss
of profits, reputation or business or any other special damages under any
provision of this Agreement.
4. NOTICES
All notices and other communications (collectively referred to as a
"Notice" or "Notices" in this paragraph) hereunder shall be given in writing or
by telegram, cable, telex or facsimile sending device. Notices shall be
addressed (a) if to the Distributor, PFMAM, Inc., Two Xxxxx Square, Suite 1600,
18th and Xxxx Xxxxxxx, Xxxxxxxxxxxx, XX 00000, Attention: Xxxxx Xxxxx; (b) if to
the Trust, at its principal place of business, Secretary, Cadre Institutional
Investors Trust, Xxx Xxxxxxxx Xxxxx - Xxxxx 000, X. Xxxxx & Xxxxxx Xxxxxxx,
Xxxxxxxxxx, XX 00000, with a copy to Xxxxxxx X. Xxxxxxxx, Esq., Xxxxxxx Xxxx &
Xxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000; or (c) if to neither of the
foregoing, at such other address as to which the sender shall have been notified
by any such Notice or other communication. The Notice may be sent by first-class
mail, in which case it shall be deemed to have been given three days after it is
sent, or if sent by telegram, cable, telex or facsimile sending device, it shall
be deemed to have been given immediately. Either party hereto may change the
address to which Notices to it shall be sent by giving Notice of such change to
the other party.
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5. FURTHER ACTIONS
Each party agrees to perform such further acts and execute such
further documents as are necessary to effectuate the purposes hereof.
6. AMENDMENTS
This Agreement or any part hereof may be changed or waived only by
an instrument in writing signed by the party against which enforcement of such
change or waiver is sought.
7. GOVERNING STATE
This Agreement shall be governed by and its provisions shall be
construed in accordance with the laws of the State of New York and the
applicable provisions of the 1940 Act. To the extent the provisions of New York
law conflict with the 1940 Act, the latter shall control.
8. MATTERS RELATING TO THE TRUST AS A DELAWARE BUSINESS TRUST
The names "Cadre Institutional Investors Trust" and "Trustees of
Cadre Institutional Investors Trust" refer respectively to the Trust created and
the trustees of the Trust, as trustees but not individually or personally,
acting from time to time under a Declaration of Trust dated as of June 27, 1995,
as amended and restated June 30, 1997, to which reference is hereby made and the
Trust's Certificate of Trust, a copy of which is on file at the office of the
Secretary of the State of Delaware, and to any and all amendments to such
documents. The obligations of "Cadre Institutional Investors Trust" entered into
in the name or on behalf thereof by any of its trustees, representatives or
agents are made not individually, but in such capacities, and are not binding
upon any of the trustees, shareholders or representatives of the Trust
personally, but bind only the assets of the Trust, and all persons dealing with
the Trust must look solely to the assets of the Trust for the enforcement of any
claims against the Trust.
9. MISCELLANEOUS
This Agreement embodies the entire agreement and understanding
between the parties hereto, and supersedes all prior agreements and
understandings relating to the subject matter thereof. The captions in this
Agreement are included for 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 Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby. This Agreement shall be binding and shall inure
to the benefit of the parties hereto and their respective successors.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed all as of the day and year first above written.
CADRE INSTITUTIONAL INVESTORS TRUST
By: /s/ Xxxxx X. Xxxxxxxxx
----------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Treasurer
PFMAM, Inc.
By: /s/ Xxxxx Xxxxxxxx
----------------------
Name: Xxxxx Xxxxxxxx
Title: President
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SCHEDULE A
to the Distribution Agreement between Cadre Institutional Investors Trust and
PFMAM, Inc.
Name of Series
Cadre Liquid Asset Fund - U.S. Government Series
Cadre Liquid Asset Fund - Money Market Series
Cadre Affinity Fund - U.S. Government Series
Cadre Affinity Fund - Money Market Series
Cadre Reserve Fund - U.S. Government Series
Cadre Reserve Fund - Money Market Series
Money Market Portfolio
U.S. Government Money Market Portfolio
