EXCLUSIVE DEALER AGREEMENT
CLASS A AND CLASS Y SHARES OF PAINEWEBBER INDEX TRUST
AGREEMENT made as of ___________, 1997, between ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Asset
Management Inc. ("▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇"), a Delaware corporation, and PaineWebber
Incorporated ("PaineWebber"), a Delaware corporation.
WHEREAS PaineWebber Index Trust ("Fund") is a Delaware business trust
registered under the Investment Company Act of 1940, as amended ("1940 Act"), as
an open-end management investment company; and
WHEREAS the Fund currently has one distinct series of shares of
beneficial interest ("Series"), which corresponds to a distinct portfolio and
has been designated as the PaineWebber S&P 500 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 A shares ("Class A Shares") and has established an unlimited number of
shares of beneficial interest of the above-referenced Series as Class Y shares
("Class Y Shares") (collectively referred to as "Shares");and
WHEREAS the Fund has adopted a Plan of Distribution pursuant to Rule
12b-1 under the 1940 Act ("Plan") for the Class A Shares of the above-referenced
Series and of such other Series as may hereafter be designated by the Board and
have Class A Shares established; and
WHEREAS ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ has entered into a Distribution Contract with
the Fund ("Distribution Contract") pursuant to which ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ serves as
principal distributor in connection with the offering and sale of the Shares of
each Series; and
WHEREAS ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ desires to retain PaineWebber as its
exclusive agent in connection with the offering and sale of the Shares of each
Series and to delegate to PaineWebber performance of certain of the services
which ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ provides to the Fund under the Distribution Contract;
and
WHEREAS PaineWebber is willing to act as ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇' exclusive
agent in connection with the offering and sale of such Shares and to perform
such services on the terms and conditions hereinafter set forth;
NOW THEREFORE, in consideration of the premises and the mutual
covenants contained herein, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and PaineWebber agree as follows:
1. Appointment. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ hereby appoints PaineWebber as its
exclusive agent to sell and to arrange for the sale of the Shares on the terms
and for the period set forth in this Agreement. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ also appoints
PaineWebber as its agent for the performance of certain other services set forth
herein which ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ provides to the Fund under the Distribution
Contract. PaineWebber hereby accepts such appointments and agrees to act
hereunder. It is understood, however, that these appointments do not preclude
sales of Shares directly through the Fund's transfer agent in the manner set
forth in the Registration Statement. As used in this Agreement, 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 ▇▇▇▇ ▇▇▇.
2. Services, Duties and Representations of PaineWebber.
(a) PaineWebber agrees to sell the Shares on a best efforts
basis from time to time during the term of this Agreement as agent for ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ and upon the terms described in this Agreement and the Registration
Statement.
(b) Upon the later of the date of this Agreement or the
initial offering of Shares by a Series to the public, PaineWebber will hold
itself available to receive orders, satisfactory to PaineWebber and ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, for the purchase of Shares and will accept such orders on behalf of
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and the Fund as of the time of receipt of such orders and will
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 Registration Statement.
(c) PaineWebber in its discretion may sell Shares to (i) its
correspondent firms and customers of such firms and (ii) such other registered
and qualified retail dealers as it may select, subject to the approval of
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇. In making agreements with such dealers, PaineWebber shall act
only as principal and not as agent for ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or the Fund.
(d) The offering price of the Shares of each Series shall be
the net asset value per Share as next determined by the Fund following receipt
of an order at PaineWebber's principal office. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall promptly
furnish or arrange for the furnishing to PaineWebber of a statement of each
computation of net asset value.
(e) PaineWebber shall not be obligated to sell any certain
number of Shares.
(f) To facilitate redemption of Shares by shareholders
directly or through dealers, PaineWebber is authorized but not required on
behalf of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and the Fund to repurchase Shares presented to it by
shareholders, its correspondent firms and other dealers at the price determined
in accordance with, and in the manner set forth in, the Registration Statement.
(g) With respect to the Class A Shares, PaineWebber shall
provide ongoing shareholder services, which include responding to shareholder
inquiries, providing shareholders with information on their investments in the
Class A Shares and any other services now or hereafter deemed to be appropriate
subjects for the payments of "service fees" under Section (b)(9) of Rule 2830 of
the Conduct Rules of the National Association of Securities Dealers, Inc.
("NASD") (collectively, "service activities"). "Service activities" with respect
to the Shares do not include the transfer agency-related and other services for
which PaineWebber receives compensation under the Service Contract between
PaineWebber and the Fund.
(h) PaineWebber represents and warrants that: (i) it is a
member in good standing of the NASD and agrees to abide by the Conduct Rules of
the NASD; (ii) it is registered as a broker-dealer with the Securities and
Exchange Commission; (iii) it will maintain any filings and licenses required by
federal and state laws to conduct the business contemplated under this
Agreement; and (iv) it will comply with all federal and state laws and
regulations applicable to the offer and sale of the Shares.
(i) PaineWebber shall not incur any debts or obligations on
behalf of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or the Fund. PaineWebber shall bear all costs that
it incurs in selling the Shares and in complying with the terms and conditions
of this Agreement as more specifically set forth in paragraph 8.
2
(j) PaineWebber shall not permit any employee or agent to
offer or sell Shares to the public unless such person is duly licensed under
applicable federal and state laws and regulations.
(k) PaineWebber shall not (i) furnish any information or make
any representations concerning the Shares other than those contained in the
Registration Statement or in sales literature or advertising that has been
prepared or approved by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ as provided in paragraph 6 or (ii)
offer or sell the Shares in jurisdictions in which they have not been approved
for offer and sale.
3. Services Not Exclusive. The services furnished by PaineWebber
hereunder are not to be deemed exclusive and PaineWebber shall be free to
furnish similar services to others so long as its services under this Agreement
are not impaired thereby. Nothing in this Agreement shall limit or restrict the
right of any director, officer or employee of PaineWebber who may also be a
director, trustee, officer or employee of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or 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.
4. Compensation.
(a) As compensation for its service activities under this
Agreement with respect to the Class A Shares, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall pay to
PaineWebber service fees with respect to Class A Shares maintained in
shareholder accounts serviced by PaineWebber employees, correspondent firms and
other dealers in such amounts as ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and PaineWebber may from time
to time agree upon.
(b) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall not be obligated to pay any
compensation to PaineWebber hereunder for any services performed by it hereunder
with respect to the Class Y Shares.
(c) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇' obligation to pay compensation to
PaineWebber with respect to the Class A Shares as agreed upon pursuant to this
paragraph 4 is not contingent upon receipt by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ of any
compensation from the Fund or Series. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall advise the Board
of any agreements or revised agreements as to compensation to be paid by
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ to PaineWebber at their first regular meeting held after such
agreement but shall not be required to obtain prior approval for such agreements
from the Board.
(e) PaineWebber may reallow all or any part of the service
fees which it is paid under this Agreement to its correspondent firms or other
dealers, in such amounts as PaineWebber may from time to time determine.
5. Duties of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇.
(a) It is understood that the Fund reserves the right at any
time to withdraw all offerings of Shares of any or all Series by written notice
to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇.
(b) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall keep PaineWebber fully informed of
the Fund's affairs and shall make available to PaineWebber copies of all
information, financial statements and other papers which PaineWebber may
reasonably request for use in connection with the distribution of the 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
3
information, and annual and interim reports of any Series as PaineWebber may
request, and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall cooperate fully in the efforts of
PaineWebber to sell and arrange for the sale of the Shares and in the
performance of PaineWebber under this Agreement.
(c) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall comply with all state and federal
laws and regulations applicable to a distributor of the Shares.
6. Advertising. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ agrees to make available such sales
and advertising materials relating to the Shares as ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ in its
discretion determines appropriate. PaineWebber agrees to submit all sales and
advertising materials developed by it relating to the Shares to ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ for approval. PaineWebber agrees not to publish or distribute such
materials to the public without first receiving such approval in writing.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall assist PaineWebber in obtaining any regulatory approvals
of such materials that may be required of or desired by PaineWebber.
7. Records. PaineWebber agrees to maintain all records required by
applicable state and federal laws and regulations relating to the offer and sale
of the Shares. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and its representatives shall have access to
such records during normal business hours for review or copying.
8. Expenses of PaineWebber. PaineWebber shall bear all costs and
expenses of (i) preparing, printing, and distributing any materials not prepared
by the Fund or ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and other materials used by PaineWebber in
connection with its offering of the Shares for sale to the public; (ii) any
expenses of advertising incurred by PaineWebber in connection with such
offering; (iii) the expenses of registration or qualification of PaineWebber as
a dealer or broker under federal or state laws and the expenses of continuing
such registration or qualification; and (iv) all compensation paid to
PaineWebber's Investment Executives or other employees and others for selling
the Shares, and all expenses of PaineWebber, its Investment Executives and
employees and others who engage in or support the sale of the Shares as may be
incurred in connection with their sales efforts. PaineWebber shall bear such
additional costs and expenses as it and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ may agree upon, such
agreement to be evidenced in a writing signed by both parties. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
shall advise the Board of any such agreement as to additional costs and expenses
borne by PaineWebber at their first regular meeting held after such agreement
but shall not be required to obtain prior approval for such agreements from the
Board.
9. Indemnification.
(a) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ agrees to indemnify, defend, and hold
PaineWebber, its officers and directors, and any person who controls PaineWebber
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 PaineWebber, its officers,
directors, or any such controlling person may incur under the 1933 Act, under
common law or otherwise, arising out of or based upon any alleged untrue
statement of a material fact contained in the Registration Statement; arising
out of or based upon any alleged omission to state a material fact required to
be stated in the Registration Statement thereof or necessary to make the
statements in the Registration Statement thereof not misleading; or arising out
of any sales or advertising materials with respect to the Shares provided by
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ to PaineWebber. However, this indemnity agreement shall not
apply to any claims, demands, liabilities, or expenses that 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
4
writing by PaineWebber to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or the Fund for use in the
Registration Statement or in any sales or advertising material; and further
provided, that in no event shall anything contained herein be so construed as to
protect PaineWebber against any liability to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or the Fund or to
the shareholders of any Series to which PaineWebber 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 Agreement.
(b) PaineWebber agrees to indemnify, defend, and hold ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ and its officers and directors, the Fund, its officers and trustees,
and any person who controls ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or 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 ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or its officers or
directors or the Fund, its officers or trustees, or any such controlling person
may incur under the 1933 Act, 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 PaineWebber to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or 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 or necessary to make such information
not misleading; or arising out of any agreement between PaineWebber and a
correspondent firm or any other retail dealer; or arising out of any sales or
advertising material used by PaineWebber in connection with its duties under
this Agreement.
10. Duration and Termination.
(a) This Agreement shall become effective upon the date written above,
provided that, with respect to any Series, this Contract shall not take effect
unless such action with respect to a Class 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, with respect to Class A Shares,
who have no direct or indirect financial interest in the operation of the Plan
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
Agreement shall continue in effect for one year from the above written date.
Thereafter, if not terminated, this Agreement 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 a particular
Class of Shares of any given Series, by vote of a majority of the outstanding
voting securities of that Class.
(c) Notwithstanding the foregoing, with respect to any Series
this Agreement may be terminated at any time, without the payment of any
penalty, by either party, upon the giving of 30 days' written notice. Such
notice shall be deemed to have been given on the date it is received in writing
by the other party or any officer thereof. This Agreement may also 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 applicable Class of Shares of such Series
on 30 days' written notice to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and PaineWebber.
5
(d) Termination of this Agreement with respect to any given
Series shall in no way affect the continued validity of this Agreement or the
performance thereunder with respect to any other Series. This Agreement will
automatically terminate in the event of its assignment or in the event that the
Distribution Contract is terminated.
(e) Notwithstanding the foregoing, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ may
terminate this Agreement without penalty, such termination to be effective upon
the giving of written notice to PaineWebber in the event that the Plan is
terminated or is amended to reduce the compensation payable to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
thereunder or in the event that the Registration Statement is amended so as to
reduce the amount of compensation payable to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ under the
Distribution Contract, provided that ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ gives notice of
termination pursuant to this provision within 90 days of such amendment or
termination of the Plan or amendment of the Registration Statement.
11. Amendment of this Agreement. No provision of this Agreement may be
amended, 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.
12. Use of PaineWebber Name. PaineWebber hereby authorizes ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ to use the name "PaineWebber Incorporated" or any name derived
therefrom in any sales or advertising materials prepared and/or used by ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ in connection with its duties as distributor of the Shares, but only
for so long as this Agreement or any extension, renewal or amendment hereof
remains in effect, including any similar agreement with any organization which
shall have succeeded to the business of PaineWebber.
13. Governing Law. This Agreement shall be construed in accordance with
the 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 1940 Act, the latter shall control.
14. Miscellaneous. 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 upon and shall inure to the
benefit of the parties hereto and their respective successors. As used in this
Agreement, the terms "majority of the outstanding voting securities,"
"interested person" and "assignment" shall have the same meaning as such terms
have in the 1940 Act.
6
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated as of the day and year first written
above.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ASSET
MANAGEMENT INC.
Attest: _______________________ By: ________________________
PAINEWEBBER INCORPORATED
Attest: _______________________ By: ________________________
