THE PIEDMONT INVESTMENT TRUST
DISTRIBUTION AGREEMENT
This DISTRIBUTION AGREEMENT ("Agreement"), dated this the 19th day of April,
2005, between THE PIEDMONT INVESTMENT TRUST, a statutory trust organized under
the laws of the State of Delaware (the "Trust"), and CAPITAL INVESTMENT GROUP,
INC., a North Carolina corporation (the "Distributor").
WITNESSETH:
WHEREAS, the Trust is engaged in business as an open-end management investment
company and is so registered under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Trust is authorized to issue an unlimited number of shares of
beneficial interest ("Shares") representing interests in a series of securities
and other assets, as identified in Appendix A attached hereto (each a "Fund" and
collectively "Funds"); and
WHEREAS, the Trust offers the Shares of such Funds and has registered the Shares
under the Securities Act of 1933, as amended (the "1933 Act"), and the 1940 Act
pursuant to a registration statement on Form N-1A (the "Registration
Statement"), including a prospectus (the "Prospectus") and a statement of
additional information (the "Statement of Additional Information"); and
WHEREAS, the Trust has adopted a Plan of Distribution Pursuant to Rule 12b-1
under the 1940 Act (the "Distribution Plan") with respect to Shares of certain
of the Funds, and may enter into related agreements providing for the
distribution of such Shares; and
WHEREAS, Distributor has agreed to act as distributor of the Shares of the Funds
for the period of this Agreement;
NOW, THEREFORE, it is hereby agreed between the parties hereto as follows:
1. Appointment of Distributor.
(a) The Trust hereby appoints Distributor its exclusive agent for the
distribution of the Shares of the Funds in jurisdictions wherein such
Shares may be legally offered for sale; provided, however, that the
Trust in its absolute discretion may issue Shares of the Funds in
connection with (i) the payment or reinvestment of dividends or
distributions; (ii) any merger or consolidation of the Trust or of a
Fund with any other investment company or trust or any personal holding
company, or the acquisition of the assets of any such entity or another
fund of the Trust; or (iii) any offer of exchange permitted by Section
11 of the 1940 Act, or any other applicable provision.
(b) Distributor hereby accepts such appointment as exclusive agent for
the distribution of the Shares of the Funds and agrees that it will
sell the Shares as agent for the Trust at prices determined as
hereinafter provided and on the terms hereinafter set forth, all
according to applicable federal and state laws and regulations and to
the Trust's Declaration of Trust ("Trust Instrument").
(c) Distributor may sell Shares of the Funds to or through qualified
securities dealers or others. Distributor will require each dealer or
other such party to conform to the provisions hereof, the Registration
Statement and the Prospectus and Statement of Additional Information,
and applicable law; and neither Distributor nor any such dealers or
others shall withhold the placing of purchase orders for Shares so as
to make a profit thereby.
(d) Distributor shall order Shares of the Funds from the Trust only to
the extent that it shall have received purchase orders therefor.
Distributor will not make, or authorize any dealers or others to make:
(i) any short sales of Shares; or (ii) any sales of Shares to any
Trustee or officer of the Trust or to any officer or director of
Distributor or of any corporation or association furnishing investment
advisory, managerial or supervisory services to the Trust, or to any
such corporation or association, unless such sales are made in
accordance with the then current Prospectus and Statement of Additional
Information.
(e) Distributor is not authorized by the Trust to give any information
or to make any representations regarding the Shares of any Fund, except
such information or representations as are contained in the
Registration Statement or in the current Prospectus or Statement of
Additional Information of the Fund, or in advertisements and sales
literature prepared by or on behalf of the Trust for Distributor's use.
(f) Notwithstanding any provision hereof, the Trust may terminate,
suspend or withdraw the offering of Shares of any Fund whenever, in its
sole discretion, it deems such action to be desirable.
2. Offering Price of Shares. All Shares of the Funds sold under this
Agreement shall be sold at the public offering price per Share in effect at
the time of the sale, as described in the then current Prospectus of the
Fund. The excess, if any, of the public offering price over the net asset
value of the Shares sold by Distributor as agent shall be retained by
Distributor as a commission for its services hereunder. Out of such
commission Distributor may allow commissions or concessions to dealers and
may allow them to others in its discretion in such amounts as Distributor
shall determine from time to time. Except as may be otherwise determined by
Distributor from time to time, such commissions or concessions shall be
uniform to all dealers. At no time shall the Trust receive less than the
full net asset value of the Shares, determined in the manner set forth in
the then current Prospectus and Statement of Additional Information.
Distributor shall also be entitled to such commissions and other fees and
payments as may be authorized by the Trustees of the Trust from time to
time under the Distribution Plan.
3. Furnishing of Information. The Trust shall furnish to Distributor
copies of any information, financial statements and other documents that
Distributor may reasonably request for use in connection with the sale of
Shares of the Funds under this Agreement. The Trust shall also make
available a sufficient number of copies of the Funds' current Prospectus
and Statement of Additional Information for use by the Distributor.
4. Fees and Expenses.
(a) In addition to any commissions, fees or payments authorized by the
Trustees under the Distribution Plan, the Trust will pay or cause to
be paid to the Distributor for services provided and expenses assumed
by the Distributor the fee of $5,000.00 per annum for each Fund. Such
fee shall be paid to the Distributor in twelve equal monthly
installments.
(b) The Trust will also pay or cause to be paid the following
expenses: (i) preparation, printing and distribution to shareholders
of the Prospectus and Statement of Additional Information; (ii)
preparation, printing and distribution of reports and other
communications to shareholders; (iii) registration of the Shares under
the federal securities laws; (iv) qualification of the Shares for sale
in certain states; (v) qualification of the Trust as a dealer or
broker under state law as well as qualification of the Trust as an
entity authorized to do business in certain states; (vi) maintaining
facilities for the issue and transfer of Shares; (vii) supplying
information, prices and other data to be furnished by the Trust under
this Agreement; (viii) certain taxes applicable to the sale or
delivery of the Shares or certificates therefore; and (ix) such other
compensation to the Distributor as the Trustees may authorize, from
time to time, in their sole discretion.
(c) Except to the extent such expenses are borne by the Trust pursuant
to the Distribution Plan, Distributor will pay or cause to be paid the
following expenses: (i) payments to sales representatives of the
Distributor and to securities dealers and others in respect of the
sale of Shares of the Funds; (ii) payment of compensation to and
expenses of employees of the Distributor and any of its affiliates to
the extent they engage in or support distribution of Funds' Shares or
render shareholder support services not otherwise provided by the
Trust's transfer agent, administrator, or custodian, including, but
not limited to, answering routine inquiries regarding a Fund,
processing shareholder transactions, and providing such other
shareholder services as the Trust may reasonably request; (iii)
formulation and implementation of marketing and promotional
activities, including, but not limited to, direct mail promotions and
television, radio, newspaper, magazine and other mass media
advertising; (iv) preparation, printing and distribution of sales
literature and of Prospectuses and Statements of Additional
Information and reports of the Trust for recipients other than
existing shareholders of a Fund; and (v) obtaining such information,
analyses and reports with respect to marketing and promotional
activities as the Trust may, from time to time, reasonably request.
(d) If so requested by the Trustees in connection with the
Distribution Plan, Distributor shall prepare and deliver reports to
the Trustees of the Trust on a regular basis, at least quarterly,
showing the expenditures with respect to each Fund pursuant to the
Distribution Plan and the purposes therefor, as well as any
supplemental reports as the Trustees of the Trust, from time to time,
may reasonably request.
5. Repurchase of Shares. Distributor as agent and for the account of
the Trust may repurchase Shares of the Funds offered for resale to it and
redeem such Shares at their net asset value.
6. Indemnification by the Trust. In absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of Distributor, the Trust agrees to indemnify
Distributor and its officers and partners against any and all claims,
demands, liabilities and expenses that Distributor may incur under the 1933
Act, or common law or otherwise, arising out of or based upon any alleged
untrue statement of a material fact contained in the Registration Statement
or any Prospectus or Statement of Additional Information of a Fund, or in
any advertisements or sales literature prepared by or on behalf of the
Trust for Distributor's use, or any omission to state a material fact
therein, the omission of which makes any statement contained therein
misleading, unless such statement or omission was made in reliance upon and
in conformity with information furnished to the Trust in connection
therewith by or on behalf of Distributor. Nothing herein contained shall
require the Trust to take any action contrary to any provision of its
Agreement and Declaration of Trust or any applicable statute or regulation.
7. Indemnification by Distributor. Distributor agrees to indemnify the
Trust and its officers and Trustees against any and all claims, demands,
liabilities and expenses which the Trust may incur under the 1933 Act, or
common law or otherwise, arising out of or based upon (i) any alleged
untrue statement of a material fact contained in the Registration Statement
or any Prospectus or Statement of Additional Information of any Fund, or in
any advertisements or sales literature prepared by or on behalf of the
Trust for Distributor's use, or any omission to state a material fact
therein, the omission of which makes any statement contained therein
misleading, if such statement or omission was made in reliance upon and in
conformity with information furnished to the Trust in connection therewith
by or on behalf of Distributor; or (ii) any act or deed of Distributor or
its sales representatives, or securities dealers and others authorized to
sell Fund Shares hereunder, or their sales representatives, that has not
been authorized by the Trust in any Prospectus or Statement of Additional
Information of any Fund or by this Agreement.
8. Term and Termination.
(a) With respect to the Funds, this Agreement shall become effective
upon the commencement of operations of each Fund as set forth in the
attached appendices. Unless terminated as herein provided, with
respect to each Fund, this Agreement shall continue in effect for two
years from the date of the Fund's commencement of operations and, with
respect to the Fund, shall continue in full force and effect for
successive periods of one year thereafter, but only so long as each
such continuance is approved (i) by either the Trustees of the Trust
or by vote of a majority of the outstanding voting securities (as
defined in the 0000 Xxx) of the Fund and, in either event, (ii) by
vote of a majority of the Trustees of the Trust who are not parties to
this Agreement or interested persons (as defined in the 0000 Xxx) of
any such party and who have no direct or indirect financial interest
in this Agreement or in the operation of the Distribution Plan or in
any agreement related thereto ("Independent Trustees"), cast at a
meeting called for the purpose of voting on such approval.
(b) With respect to the Funds, this Agreement may be terminated at any
time without the payment of any penalty by vote of the Trustees of the
Trust or a majority of the Independent Trustees or by vote of a
majority of the outstanding voting securities (as defined in the 0000
Xxx) of the Funds or by Distributor, on sixty days' written notice to
the other party.
(c) This Agreement shall automatically terminate in the event of its
assignment (as defined in the 1940 Act).
9. Subcontract. The Distributor may, at its expense and with the
approval of the Trustees, appoint another firm or company as its
sub-distributor or agent. The Distributor shall not, however, be relieved
of any of its obligations under this Agreement by the appointment of such
sub-distributor or agent.
10. Limitation of Liability. The obligations of the Trust hereunder
shall not be binding upon any of the Trustees, officers or shareholders of
the Trust personally, but shall bind only the assets and property of the
Trust. The term "The Piedmont Investment Trust" means and refers to the
Trustees from time to time serving under the Agreement and Trust Instrument
of the Trust. The execution and delivery of this Agreement has been
authorized by the Trustees, and this Agreement has been signed on behalf of
the Trust by an authorized officer of the Trust, acting as such and not
individually, and neither such authorization by such Trustees nor such
execution and delivery by such officer shall be deemed to have been made by
any of them individually or to impose any liability on any of them
personally, but shall bind only the assets and property of the Trust as
provided in the Agreement and Trust Instrument of Trust.
11. Books and Records. In compliance with the requirements of Rule
31a-3 under the 1940 Act, the Distributor hereby agrees that all records
which it maintains for the Trust are the property of the Trust and further
agrees to surrender promptly to the Trust any of such records upon the
Trust's request.
12. Notices. Notices of any kind to be given to the Trust hereunder by
the Distributor shall be in writing and shall be duly given if mailed or
delivered to The Piedmont Investment Trust, 0000 Xxxxx Xxxx, Xxxxxxxxxx,
Xxxxx Xxxxxxxx 00000, Attention: Xxxx X. Xxxxxxx, Chairman or to such other
address or to such individual as shall be so specified by the Trust to the
Distributor. Notices of any kind to be given to the Distributor hereunder
by the Trust shall be in writing and shall be duly given if mailed or
delivered to the Capital Investment Group, Inc., X.X. Xxx 0000, Xxxxx
Xxxxx, XX 00000, or at such other address or to such individual as shall be
so specified by the Distributor to the Trust. Notices shall be effective
upon delivery.
IN WITNESS THEREOF, the parties hereto have caused this Agreement to be executed
as of the date first written above.
THE PIEDMONT INVESTMENT TRUST
By: /s/ Xxxx X. Xxxxxxx
________________________
Name: Xxxx X. Xxxxxxx
Title: Chairman
CAPITAL INVESTMENT GROUP,INC.
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
APPENDIX A
Dated as of April 19, 2005
o The Piedmont Select Value Fund
Date Fund commenced operations: ____________________
