EXHIBIT (E)(1)
AMENDED AND RESTATED
DISTRIBUTION CONTRACT
PIMCO Funds: Pacific Investment Management Series
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__________, 1999
PIMCO Funds Distributors LLC
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Dear Sirs:
This will confirm the agreement between the undersigned (the "Trust") and
you (the "Distributor") as follows:
1. Description of Trust and Classes of Shares. The Trust is an open-end
investment company which presently has the following twenty-seven investment
portfolios: Money Market Fund; Short-Term Fund; Low Duration Fund; Low Duration
Fund II; Low Duration Fund III; Low Duration Mortgage Fund; Moderate Duration
Fund; Real Return Bond Fund; Total Return Fund; Total Return Fund II; Total
Return Fund III; Total Return Mortgage Fund; Commercial Mortgage Securities
Fund; High Yield Fund; Long-Term U.S. Government Fund; Long Duration Fund;
Global Bond Fund; Global Bond Fund II; Foreign Bond Fund; International Bond
Fund; Emerging Markets Bond Fund; Emerging Markets Bond Fund II; Municipal Bond
Fund; Strategic Balanced Fund; Convertible Bond Fund; StocksPLUS Fund and
StocksPLUS Short Strategy Fund (each a "Fund," and collectively, the "Funds").
Additional investment portfolios may be established in the future. This
Contract shall pertain to the Funds and to such additional investment portfolios
as shall be designated in Supplements to this Contract, as further agreed
between the Trust and the Distributor. A separate series of shares of
beneficial interest in the Trust is offered to investors with respect to each
Fund, and each Fund currently offers its shares with respect to up to eight
classes: Class A shares, Class B shares, and Class C shares (together, the
"Retail Classes"), and Class D shares, Class J shares, Class K shares,
Institutional Class shares, and Administrative Class shares. The Trust engages
in the business of investing and reinvesting the assets of the Funds in the
manner and in accordance with the investment objective and restrictions
specified in the Trust's currently effective Prospectus or Prospectuses and
Statement(s) of Additional Information (together, the "Prospectus") relating to
the Retail Classes, Class D, Class J, Class K, Institutional Class and
Administrative Class shares of the Funds included in the Trust's Registration
Statement, as amended from time to time (the "Registration Statement"), as filed
by the Trust under the Investment Company Act of 1940, as amended (together with
the rules and regulations thereunder, the "1940 Act") and the Securities Act of
1933, as amended (together with the rules and regulations thereunder, the "1933
Act"). Copies of the documents referred to in the preceding sentence have been
furnished to the Distributor. Any amendments to those documents shall be
furnished to the Distributor promptly. The Trust
has adopted separate Distribution and Servicing Plans pursuant to Rule 12b-1
under the 1940 Act with respect to each of the Retail Classes (the "Retail Class
Plans"), Class J shares (the "Class J Plan") and Class K shares (the "Class K
Plan"), has adopted a distribution plan, also pursuant to Rule 12b-1, with
respect to Class D shares (the "Defensive Plan") as part of an Amended and
Restated Administration Agreement (the "Administration Agreement") between the
Trust and Pacific Investment Management Company (the "Administrator"), and has
adopted a Distribution Plan, also pursuant to Rule 12b-1, with respect to the
Administrative Class shares of the Funds (the "Administrative Distribution
Plan"). The Trust has also adopted an Administrative Services Plan with respect
to the Administrative Class shares of the Funds, in conformity with Rule 12b-1,
as if the expenditures made thereunder were subject to Rule 12b-1, excepting the
shareholder voting rights under Rule 12b-1 (the "Administrative Services Plan,"
and together with the Retail Class Plans, the Administrative Distribution Plan
and the Defensive Plan, the "Plans").
2. Appointment and Acceptance. The Trust hereby appoints the Distributor
as a distributor of shares of beneficial interest in the Trust (the "shares")
which may from time to time be registered under the 1933 Act and as servicing
agent of shareholders and shareholder accounts of the Trust, and the Distributor
hereby accepts such appointment in accordance with the terms and conditions set
forth herein. As the Trust's agent, the Distributor shall, except to the extent
provided in Section 4 hereof, be the exclusive distributor for the unsold
portion of the shares.
3. Sale of Shares to Distributor and Sales by Distributor. The Distributor
will have the right, as principal, to sell shares of each Class of each Fund
directly to the public against orders therefor at the applicable public offering
price as described below in the case of Class A shares, Class J shares and Class
K shares, and at net asset value in the case of Class B shares, Class C shares,
Class D shares, Institutional Class shares and Administrative Class shares. For
such purposes, the Distributor will have the right to purchase shares at net
asset value. The Distributor will also have the right, as agent, to sell shares
of a Fund indirectly to the public through broker-dealers who are members of the
National Association of Securities Dealers, Inc. and who are acting as
introducing brokers pursuant to clearing agreements with the Distributor
("introducing brokers"), to broker-dealers which are members of the National
Association of Securities Dealers, Inc. and who have entered into selling
agreements with the Distributor ("participating brokers") or through other
financial intermediaries, in each case against orders therefor. The price for
introducing brokers, participating brokers and other financial intermediaries
shall be, in the case of Class A shares, Class J shares and Class K shares, the
applicable public offering price less a concession to be determined by the
Distributor, which concession will not exceed the amount of the sales charge or
underwriting discount, if any, described below and, in the case of Class B
shares, Class C shares, Class D shares, Institutional Class shares and
Administrative Class shares, net asset value.
The Trust shall sell through the Distributor, as the Trust's agent, shares
to eligible investors as described in the Prospectus. All orders through the
Distributor shall be subject to acceptance and confirmation by the Trust. The
Trust shall have the right, at its election, to deliver either shares issued
upon original issue or treasury shares.
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Prior to the time of transfer of any shares by the Trust to, or on the
order of, the Distributor or any introducing broker, participating broker or
other financial intermediary, the Distributor shall pay or cause to be paid to
the Trust or to its order an amount in New York clearing house funds equal to
the applicable net asset value of the shares. Upon receipt of registration
instructions in proper form, the Distributor will transmit or cause to be
transmitted such instructions to the Trust or its agent for registration of the
shares purchased.
The public offering price of Class A shares, Class J shares and Class K
shares shall be the net asset value of such shares, plus any applicable sales
charge as set forth in the Prospectus. In no event will any applicable sales
charge or underwriting discount exceed the limitations on permissible sales
loads imposed by Section 22(b) of the 1940 Act and Rule 2830(d) of the Conduct
Rules of the National Association of Securities Dealers, Inc., as either or both
may be amended from time to time.
On every sale, the Trust shall receive the net asset value of the shares.
The net asset value of shares shall be determined in the manner provided in the
Declaration of Trust and By-laws of the Trust as then amended. In the case of
Class A shares, Class J shares and Class K shares, the Distributor may retain so
much of any sales charge or underwriting discount as is not allowed by the
Distributor as a concession to dealers, and such sales charge or underwriting
discount shall be in addition to the fee paid to the Distributor in respect of
Class A shares, Class J shares and Class K shares as described in Section 5
hereof.
4. Sales of Shares by the Trust. In addition to sales by the Distributor,
the Trust reserves the right to issue shares at any time directly to its
shareholders as a stock dividend or stock split or to sell shares to its
shareholders or other persons at not less than net asset value to the extent
that the Trust, its officers, or other persons associated with the Trust
participate in the sale, or to the extent that the Trust or the transfer agent
for its shares receive purchase requests for shares.
5. Fees. For its services as servicing agent of a Fund's Class A
shareholders and Class A shareholder accounts, the Trust shall pay the
Distributor on behalf of the Fund a servicing fee at the annual rate of 0.25% of
the Fund's average daily net assets attributable to its Class A shares upon the
terms and conditions set forth in the Distribution and Servicing Plan attached
as Exhibit A hereto, and as amended from time to time, and may retain so much of
any sales charge or underwriting discount as is not allowed by the Distributor
as a concession to dealers, and shall receive any contingent deferred sales
charge as provided in Section 8 hereof.
For its services as distributor of a Fund's Class B and Class C shares and
as servicing agent of Class B and Class C shareholders and Class B and Class C
shareholder accounts, the Trust shall pay the Distributor on behalf of the Fund
a distribution fee at the annual rate of 0.75% of the Fund's average daily net
assets, and a servicing fee at the annual rate of 0.25% of the Fund's average
daily net assets, attributable to the Fund's Class B shares and Class C shares,
respectively, upon the terms and conditions set forth in the relevant
Distribution and Servicing Plans attached as Exhibits B and C hereto, as amended
from time to time, and shall receive any contingent deferred sales charge as
provided in Section 8 hereof. The respective distribution and
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servicing fees shall be accrued daily and paid monthly to the Distributor as
soon as practicable after the end of the calendar month in which they accrue,
but in any event within 5 business days following the last calendar day of each
month.
For its services as distributor of a Fund's Class J shares and as servicing
agent of Class J shareholders and Class J shareholder accounts, the Trust shall
pay the Distributor on behalf of the Fund a distribution fee at the annual rate
of 0.45% of the Fund's average daily net assets, and a servicing fee at the
annual rate of 0.25% of the Fund's average daily net assets, attributable to the
Fund's Class J shares, respectively, upon the terms and conditions set forth in
the Distribution and Servicing Plan attached as Exhibit D hereto, as amended
from time to time, and may retain so much of any sales charge or underwriting
discount as is not allowed by the Distributor as a concession to dealers. The
respective distribution and servicing fees shall be accrued daily and paid
monthly to the Distributor as soon as practicable after the end of the calendar
month in which they accrue, but in any event within 5 business days following
the last calendar day of each month.
For its services as distributor of a Fund's Class K shares and as servicing
agent of Class K shareholders and Class K shareholder accounts, the Trust shall
pay the Distributor on behalf of the Fund a distribution fee at the annual rate
of 0.75% of the Fund's average daily net assets, and a servicing fee at the
annual rate of 0.25% of the Fund's average daily net assets, attributable to the
Fund's Class K shares, respectively, upon the terms and conditions set forth in
the Distribution and Servicing Plan attached as Exhibit E hereto, as amended
from time to time, and may retain so much of any sales charge or underwriting
discount as is not allowed by the Distributor as a concession to dealers. The
respective distribution and servicing fees shall be accrued daily and paid
monthly to the Distributor as soon as practicable after the end of the calendar
month in which they accrue, but in any event within 5 business days following
the last calendar day of each month.
The Trust shall reimburse the Distributor at an annual rate not to exceed
0.25% of the Fund's average daily net assets attributable to its Administrative
Class shares for payments made by the Distributor to various financial
intermediaries in connection with the distribution of Administrative Class
shares upon the terms and conditions set forth in the Administrative
Distribution Plan set forth as Exhibit F hereto.
The Distributor shall receive no compensation from the Trust for services
as distributor of the Institutional Class or Class D shares, although the
Administrator may choose, in respect of Class D shares, to make payments to the
Distributor pursuant to the Defensive Plan or otherwise.
6. Reservation of Right Not to Sell. The Trust reserves the right to
refuse at any time or times to sell any of its shares for any reason deemed
adequate by it.
7. Use of Sub-Agents; Non-exclusivity. The Distributor may employ such
sub-agents, including one or more participating brokers or introducing brokers,
for the purposes of selling shares of the Trust as the Distributor, in its sole
discretion, shall deem advisable or desirable. The Distributor may enter into
similar arrangements with other issuers and, except to the extent necessary to
perform its obligations hereunder, nothing herein shall be deemed to limit
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or restrict the right of the Distributor, or any affiliate of the Distributor,
or any employee of the Distributor, to engage in any other business or to devote
time and attention to the management or other aspects of any other business,
whether of a similar or dissimilar nature, or to render services of any kind to
any other corporation, firm, individual or association.
8. Repurchase of Shares. The Distributor will act as agent for the Trust
in connection with the repurchase and redemption of shares by the Trust upon the
terms and conditions set forth in the Prospectus or as the Trust acting through
its Trustees may otherwise direct. The Distributor may employ such sub-agents,
including one or more participating brokers or introducing brokers, for such
purposes as the Distributor, in its sole discretion, shall deem to be advisable
or desirable. Any contingent deferred sales charge imposed on repurchases and
redemptions of Class A, Class B and Class C shares upon the terms and conditions
set forth in the Prospectus shall be paid to the Distributor in addition to the
fees with respect to Class A, Class B and Class C shares set forth in Section 5
hereof. The Trust will take such steps as are commercially reasonable to track
on a share-by-share basis the aging of its shares for purposes of calculating
any contingent deferred sales charges and/or distribution fees.
9. Basis of Purchases and Sales of Shares. The Distributor's obligation
to sell shares hereunder shall be on a best efforts basis only and the
Distributor shall not be obligated to sell any specific number of shares. Shares
will be sold by the Distributor only against orders therefor. The Distributor
will not purchase shares from anyone other than the Trust except in accordance
with Section 8 hereof, and will not take "long" or "short" positions in shares
contrary to any applicable provisions of the Declaration of Trust of the Trust,
as amended.
10. Rules of Securities Associations, etc. As the Trust's agent, the
Distributor may sell and distribute shares in such manner not inconsistent with
the provisions hereof and the Trust's Prospectus as the Distributor may
determine from time to time. In this connection, the Distributor shall comply
with all laws, rules and regulations applicable to it, including, without
limiting the generality of the foregoing, all applicable rules or regulations
under the 1940 Act and of any securities association registered under the
Securities Exchange Act of 1934, as amended (together with the rules and
regulations thereunder, the "1934 Act"). The Distributor will conform to the
Conduct Rules of the National Association of Securities Dealers, Inc. and the
securities laws of any jurisdiction in which it sells, directly or indirectly,
any shares. The Distributor also agrees to furnish to the Trust sufficient
copies of any agreement or plans it intends to use in connection with any sales
of shares in adequate time for the Trust to file and clear them with the proper
authorities before they are put in use, and not to use them until so filed and
cleared.
11. Independent Contractor. The Distributor shall be an independent
contractor and neither the Distributor nor any of its officers or employees as
such, is or shall be an employee of the Trust. The Distributor is responsible
for its own conduct and the employment, control and conduct of its agents and
employees and for injury to such agents or employees or to others through its
agents or employees. The Distributor assumes full responsibility for its agents
and employees under applicable statutes and agrees to pay all employer taxes
thereunder.
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12. Registration and Qualification of Shares. The Trust agrees to execute
such papers and to do such acts and things as shall from time to time be
reasonably requested by the Distributor for the purpose of qualifying and
maintaining qualification of the shares for sale under the so-called Blue Sky
Laws of any state or for maintaining the registration of each Fund of the Trust
and the Trust under the 1933 Act and the 1940 Act, to the end that there will be
available for sale from time to time such number of shares as the Distributor
may reasonably be expected to sell. The Trust shall advise the Distributor
promptly of (a) any action of the Securities and Exchange Commission or any
authorities of any state or territory, of which it may be advised, affecting
registration or qualification of the Trust, a Fund or the shares thereof, or
rights to offer such shares for sale and (b) the happening of any event which
makes untrue any statement or which requires the making of any change in the
Registration Statement or Prospectus in order to make the statements therein not
misleading.
13. Securities Transactions. The Trust agrees that the Distributor may
effect a transaction on any national securities exchange of which it is a member
for the account of the Trust and any Fund of the Trust which is permitted by
Section 11(a) of the 1934 Act.
14. Expenses.
(a) The Distributor shall from time to time employ or associate with
it such persons as it believes necessary to assist it in carrying out its
obligations under this Contract. The compensation of such persons shall be paid
by the Distributor.
(b) The Distributor shall pay all expenses incurred in connection
with its qualification as a dealer or broker under Federal or state law.
(c) The Distributor will pay all expenses of preparing, printing and
distributing advertising and sales literature as such expenses relate to Retail
Class shares (apart from expenses of registering shares under the 1933 Act and
the 1940 Act and the preparation and printing of prospectuses and reports for
shareholders as required by said Acts and the direct expenses of the issue of
shares, except that the Distributor will pay the cost of the preparation and
printing of prospectuses and shareholders' reports used by it in the sale of
Trust shares). The Trust may enter into arrangements with affiliates of the
Distributor providing for the payment by such affiliates of some or all of these
expenses as they relate to Class D, Class J, Class K, Institutional Class and/or
Administrative Class shares.
(d) The Trust shall pay or cause to be paid all expenses incurred in
connection with (i) the preparation, printing and distribution to shareholders
of the Prospectus and reports and other communications to existing shareholders,
(ii) future registrations of shares under the 1933 Act and the ▇▇▇▇ ▇▇▇, (▇▇▇)
amendments of the Registration Statement subsequent to the initial public
offering of shares, (iv) qualification of shares for sale in jurisdictions
designated by the Distributor, including under the securities or so-called "Blue
Sky" laws of any State, (v) qualification of the Trust as a dealer or broker
under the laws of jurisdictions designated by the Distributor, (vi)
qualification of the Trust as a foreign corporation authorized to do business in
any jurisdiction if the Distributor determines that such qualification is
necessary or desirable for the purpose of facilitating sales of shares, (vii)
maintaining facilities for the issue and transfer
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of shares, (viii) supplying information, prices and other data to be furnished
by the Trust under this Contract, (ix) any expenses assumed by the Trust with
regard to shares of each Retail Class of each Fund pursuant to the Retail Class
Plan applicable to that class; (x) any expenses assumed by the Trust with regard
to Class J shares of each Fund pursuant to the Class J Plan; (xi) any expenses
assumed by the Trust with regard to Class K shares of each Fund pursuant to the
Class K Plan; (xii) any expenses assumed by the Trust with regard to the
Administrative Class shares of each Fund pursuant to the Administrative
Distribution Plan; (xiii) any expenses assumed by the Trust with regard to the
Administrative Class shares of each Fund pursuant to the Administrative Services
Plan; and (xiv) any expenses assumed by the Trust with regard to the Class D
shares pursuant to the Administration Agreement and the Defensive Plan.
(e) The Trust shall pay any original issue taxes or transfer taxes
applicable to the sale or delivery of shares or certificates therefor.
15. Indemnification of Distributor. The Trust shall prepare and furnish to
the Distributor from time to time such number of copies of the most recent form
of the Prospectus filed with the Securities and Exchange Commission as the
Distributor may reasonably request. The Trust authorizes the Distributor to use
the Prospectus, in the form furnished to the Distributor from time to time, in
connection with the sale of shares. The Trust shall indemnify, defend and hold
harmless the Distributor, its officers and trustees and any person who controls
the Distributor within the meaning of the 1933 Act, 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 the Distributor, its officers and trustees or any
such controlling person may incur under the 1933 Act, the 1940 Act, the common
law or otherwise, arising out of or based upon any alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus or
arising out of or based upon any alleged omission to state a material fact
required to be stated in either or necessary to make the statements in either
not misleading. This Contract shall not be construed to protect the Distributor
against any liability to the Trust or its shareholders to which the Distributor
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 and duties under this Contract. This indemnity
agreement is expressly conditioned upon the Trust being notified of any action
brought against the Distributor, its officers or directors or any such
controlling person, which notification shall be given by letter or by telegram
addressed to the Trust at its principal office in Newport Beach, California, 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 it may have to the person against whom such action is
brought by reason of any such alleged untrue statement or omission otherwise
than on account of the indemnity agreement contained in this Section 15. The
Trust shall be entitled to assume the defense of any suit brought to enforce any
such claim, demand or liability, but, in such case, the defense shall be
conducted by counsel chosen by the Trust and approved by the Distributor. If the
Trust elects to assume the defense of any such suit and retain counsel 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 the case
the Trust does not elect to assume the
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defense of any such suit, or in the case the Distributor does not approve of
counsel chosen by the Trust, the Trust will reimburse the Distributor, its
officers and directors 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. In addition, the Distributor shall have the right to
employ counsel to represent it, its officers and directors and any such
controlling person who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the Distributor against the Trust
hereunder if in the reasonable judgment of the Distributor it is advisable for
the Distributor, its officers and directors or such controlling person to be
represented by separate counsel, in which event the fees and expenses of such
separate counsel shall be borne by the Trust. This indemnity agreement and the
Trust's representations and warranties in this Contract shall remain operative
and in full force and effect regardless of any investigation made by or on
behalf of the Distributor, its officers and directors or any such controlling
person. This indemnity agreement shall inure exclusively to the benefit of the
Distributor and its successors, the Distributor's officers and directors and
their respective estates and any such controlling persons and their successors
and estates. The Trust shall promptly notify the Distributor of the commencement
of any litigation or proceedings against it in connection with the issue and
sale of any shares.
16. Indemnification of Trust. The Distributor agrees to indemnify, defend
and hold harmless the Trust, its officers and Trustees and any person who
controls the Trust within the meaning of the 1933 Act, 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 the Trust, its officers or Trustees
or any such controlling person, may incur under the 1933 Act, the 1940 Act, the
common law or otherwise, but only to the extent that such liability or expense
incurred by the Trust, its officers or Trustees or such controlling person
resulting from such claims or demands shall arise out of or be based upon (a)
any alleged untrue statement of a material fact contained in information
furnished in writing by the Distributor to the Trust specifically for use in the
Registration Statement or the Prospectus or shall arise out of or be based upon
any alleged omission to state a material fact in connection with such
information required to be stated in the Registration Statement or the
Prospectus or necessary to make such information not misleading, (b) any alleged
act or omission on the Distributor's part as the Trust's agent that has not been
expressly authorized by the Trust in writing, and (c) any claim, action, suit or
proceeding which arises out of or is alleged to arise out of the Distributor's
failure to exercise reasonable care and diligence with respect to its services
rendered in connection with investment, reinvestment, employee benefit and other
plans for shares. The foregoing rights of indemnification shall be in addition
to any other rights to which the Trust or a Trustee may be entitled as a matter
of law. This indemnity agreement is expressly conditioned upon the Distributor
being notified of any action brought against the Trust, its officers or Trustees
or any such controlling person, which notification shall be given by letter or
telegram addressed to the Distributor at its principal office in Stamford,
Connecticut, 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 failure to notify the Distributor of any such action shall
not relieve the Distributor from any liability which it may have to the Trust,
its officers or Trustees or such controlling person by reason of any alleged
misstatement, omission, act or failure on the Distributor's part otherwise
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than on account of the indemnity agreement contained in this Section 16. The
Distributor shall have a right to control the defense of such action with
counsel of its own choosing and approved by the Trust if such action is based
solely upon such alleged misstatement, omission, act or failure on the
Distributor's part, and in any other event the Trust, its officers and Trustees
or such controlling person shall each have the right to participate in the
defense or preparation of the defense of any such action at their own expense.
If the Distributor elects to assume the defense of any such suit and retain
counsel approved by the Trust, 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 Distributor does not elect to assume the defense of any such
suit, or in the case the Trust does not approve of counsel chosen by the
Distributor, the Distributor will reimburse the Trust, its officers and Trustees
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 Trust or them. In
addition, the Trust shall have the right to employ counsel to represent it, its
officers and Trustees and any such controlling person who may be subject to
liability arising out of any claim in respect of which indemnity may be sought
by the Trust against the Distributor hereunder if in the reasonable judgment of
the Trust it is advisable for the Trust, its officers and Trustees or such
controlling person to be represented by separate counsel, in which event the
fees and expense of such separate counsel shall be borne by the Distributor.
This indemnity agreement and the Distributor's representations and warranties in
this Contract shall remain operative and in full force and effect regardless of
any investigation made by or on behalf of the Trust, its officers and Trustees
or any such controlling person. This indemnity agreement shall inure exclusively
to the benefit of the Trust and its successors, the Trust's officers and
Trustees and their respective estates and any such controlling persons and their
successors and estates. The Distributor shall promptly notify the Trust of the
commencement of any litigation or proceedings against it in connection with the
issue and sale of any shares.
17. Assignment Terminates this Contract; Amendments of this Contract. This
Contract shall automatically terminate, without the payment of any penalty, in
the event of its assignment. This Contract may be amended only if such amendment
be approved either by action of the Trustees of the Trust or at a meeting of the
shareholders of the Trust by the affirmative vote of a majority of the
outstanding shares of the Trust, and by a majority of the Trustees of the Trust
who are not interested persons of the Trust and who have no direct or indirect
financial interest in the operation of the Plans or this Contract by vote cast
in person at a meeting called for the purpose of voting on such approval.
18. Effective Period and Termination of this Contract. This Contract
shall take effect upon the date first above written and shall remain in full
force and effect continuously as to a Fund and a class of shares thereof (unless
terminated automatically as set forth in Section 17 hereof) until terminated:
(a) Either by such Fund or such class or the Distributor by not more
than sixty (60) days' nor less than thirty (30) days' written notice
delivered or mailed by registered mail, postage prepaid, to the other
party; or
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(b) Automatically as to any Fund or class thereof at the close of
business one year from the date hereof, or upon the expiration of one
year from the effective date of the last continuance of this Contract,
whichever is later, if the continuance of this Contract is not
specifically approved at least annually by the Trustees of the Trust
or the shareholders of such Fund or such class by the affirmative vote
of a majority of the outstanding shares of such Fund or such class;
and by a majority of the Trustees of the Trust who are not interested
persons of the Trust and who have no direct or indirect financial
interest in the operation of the Plans or this Contract by vote cast
in person at a meeting called for the purpose of voting on such
approval.
Action by a Fund or a class thereof under (a) above may be taken either (i)
by vote of the Trustees of the Trust, or (ii) by the affirmative vote of a
majority of the outstanding shares of such Fund or such class. The requirement
under (b) above that the continuance of this Contract be "specifically approved
at least annually" shall be construed in a manner consistent with the 1940 Act
and the rules and regulations thereunder.
Termination of this Contract pursuant to this Section 18 shall be without
the payment of any penalty.
If this Contract is terminated or not renewed with respect to one or more
Funds or classes thereof, it may continue in effect with respect to any Fund or
any class thereof as to which it has not been terminated (or has been renewed).
19. Limited Recourse. The Distributor hereby acknowledges that the
Trust's obligations hereunder with respect to the distribution fee or servicing
fee or contingent deferred sales charges payable with respect to the shares of
any Fund of the Trust or a particular class of shares of a Fund are binding only
on the assets and property belonging to such Fund or allocated to such class.
20. Certain Definitions. For the purposes of this Contract, the
"affirmative vote of a majority of the outstanding shares" means the affirmative
vote, at a duly called and held meeting of shareholders, (a) of the holders of
67% or more of the shares of the Trust, Fund or class, as the case may be,
present (in person or by proxy) and entitled to vote at such meeting, if the
holders of more than 50% of the outstanding shares of the Trust, Fund or class,
as the case may be, entitled to vote at such meeting are present in person or by
proxy, or (b) of the holders of more than 50% of the outstanding shares of the
Trust, Fund or class, as the case may be, entitled to vote at such meeting,
whichever is less.
For the purposes of this Contract, the terms "interested persons" and
"assignment" shall have the meanings defined in the 1940 Act, subject, however,
to such exemptions as may be granted by the Securities and Exchange Commission
under said Act. Certain other items used herein that are not otherwise defined
have the meaning given in the Trust's Prospectus or constituent agreements or
documents of the Trust.
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The Declaration of Trust establishing the Trust, dated February 19, 1987, a
copy of which, together with all amendments thereto (the "Declaration"), is on
file in the Office of the Secretary of State of the Commonwealth of
Massachusetts, provides that the name "PIMCO Funds" refers to the Trustees under
the Declaration collectively as Trustees and not as individuals or personally,
and that no shareholder, trustee, officer, employee or agent of the Trust shall
be subject to claims against or obligations of the Trust (or a particular Fund
or class of shares) to any extent whatsoever, but that the Trust (or a
particular Fund or class of shares) shall only be liable.
If the foregoing correctly sets forth the agreement between the Trust and
the Distributor, please so indicate by signing and returning to the Trust the
enclosed copy hereof.
Very truly yours,
PIMCO FUNDS: PACIFIC INVESTMENT
MANAGEMENT SERIES
By:
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Title:
ACCEPTED:
PIMCO FUNDS DISTRIBUTORS LLC
By:
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Title:
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