Exhibit (e)(2)
UNDERWRITING AGREEMENT
THIS AGREEMENT is made as of January 1, 2008 by and between PFPC
DISTRIBUTORS, INC., a Massachusetts corporation ("Distributor"), and the
HIGHMARK FUNDS, a Massachusetts business trust (the "Trust").
W I T N E S S E T H:
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WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and is currently offering units of beneficial interest (such units of all series
are hereinafter called the "Shares"), representing interests in investment
portfolios of the Trust identified on Exhibit A hereto (each a "Fund" and
collectively, the "Funds"), as amended from time to time, which are registered
with the Securities and Exchange Commission (the "SEC") pursuant to the Trust's
Registration Statement on Form N-1A (the "Registration Statement"); and
WHEREAS, the Trust wishes to retain Distributor to serve as principal
underwriter and distributor for the Trust to provide for the sale and
distribution of the Shares of the Funds identified on Exhibit A and for such
additional classes or series as the Trust may issue, and Distributor wishes to
furnish such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. DEFINITIONS.
As used in this Agreement:
(a) "1933 ACT" means the Securities Act of 1933, as amended.
(b) "1934 ACT" means the Securities Exchange Act of 1934, as amended.
(c) "1940 ACT" means the Investment Company Act of 1940, as amended.
(d) "AUTHORIZED PERSON" means any officer of the Trust and any other
person duly authorized by the Trust's Board of Trustees to give
Oral Instructions and Written Instructions on behalf of the Trust
or any Fund. An initial list of such persons is attached as
Exhibit B. An Authorized Person's scope of authority may be
limited by setting forth such limitation in a written document
signed by both parties hereto.
(e) "FINRA" means the Financial Industry Regulatory Authority
(f) "INTELLECTUAL PROPERTY RIGHTS" means copyright rights, patent
rights, trade secret rights, and any other proprietary or
intellectual property rights recognized in any jurisdiction in
the world.
(g) "ORAL INSTRUCTIONS" mean oral instructions received by
Distributor from an Authorized Person or from a person reasonably
believed by Distributor to be an Authorized Person. Distributor
may in each separate instance, consider and rely upon
instructions it receives from an Authorized Person via electronic
mail as Oral Instructions.
(h) "REGISTRATION STATEMENT" means any Registration Statement and any
Prospectus and any Statement of Additional Information relating
to the Trust or any Fund filed with the SEC and any amendments or
supplements thereto at any time filed with the SEC.
(i) "SEC" means the United States Securities and Exchange Commission.
(j) "SECURITIES LAWS" mean the 1933 Act, the 1934 Act, and the 1940
Act.
(k) "WRITTEN INSTRUCTIONS" mean (i) written instructions signed by an
Authorized Person (or a person reasonably believed by Distributor
to be an Authorized Person) and received by Distributor or (ii)
trade instructions transmitted (and received by Distributor) by
means of an electronic transaction reporting system access to
which requires use of a password or other authorized identifier.
The instructions may be delivered electronically (with respect to
sub-item (ii) above) or by hand, mail, tested telegram, cable,
telex or facsimile sending device.
2. APPOINTMENT.
The Trust hereby appoints Distributor to serve as the principal
underwriter and distributor of its Shares of the Funds in accordance
with the terms set forth in this Agreement. Distributor accepts such
appointment and agrees to furnish such services. The Trust understands
that Distributor is now, and may in the future be, the principal
underwriter of the shares of several investment companies or series
(collectively, the "Investment Entities"), including Investment
Entities having investment objectives similar to those of the Funds.
The Trust further understands that investors and potential investors
in the Funds may invest in shares of such other Investment Entities.
The Trust agrees that Distributor's duties to such Investment Entities
shall not be deemed in conflict with its duties to the Trust or any
Fund under this Agreement; provided that, Distributor shall not
unreasonably favor duties for other Investment Entities over duties
for the Trust.
Underwriting Agreement as of January 1, 2008 Page 2 of 29
between PFPC Distributors, Inc. and HighMark Funds
Distributor shall be under no duty to take any action hereunder on
behalf of the Trust or any Fund except as specifically set forth
herein or as may be specifically agreed to by Distributor and the
Trust in writing.
3. DUTIES AND OBLIGATIONS OF DISTRIBUTOR.
(a) Distributor will act as principal underwriter on behalf of the
Trust for the distribution of the Shares covered by the
Registration Statement under the 1933 Act and provide the
underwriting and distribution services outlined below and as
follows: (i) preparation and execution of selling and/or or
servicing agreements, (ii) preparation of quarterly Rule 12b-1
Reports to the Board, (iii) advertising and sales literature
review, recommendations and submission to the FINRA.
(b) As a Fund Member of the National Securities Clearing Corporation
("NSCC"), Distributor will establish a NSCC participant number
for the Trust and will provide an interface for the Trust for
trading and settling transactions through the facilities of the
NSCC ("NSCC Interface"). Distributor will ensure that the Trust's
NSCC participant number is properly established and maintained.
(c) Distributor will provide reports and assistance to, and enter
into any necessary contracts with, the third party agent
servicing Class B shares for the Trust, if necessary.
(d) Distributor hereby grants to the Trust a limited, nonexclusive,
nontransferable right to access and utilize its Principal Review
web portal and software system for the review and submission of
advertising and sales literature ("Distributor Software") and
such license shall immediately be terminated with the termination
of this Agreement. No right is granted for use of the Distributor
Software by any third party affiliated with the Trust unless such
third party is approved in advance by Distributor. Distributor
and its licensors reserve all rights in the Distributor Software
and related documentation not expressly granted to the Trust
herein. Distributor and its suppliers will continue to own all of
their respective right, title, and interest in and to the
Distributor Software, computer programs, screen formats, report
formats, interactive design techniques, derivative works,
inventions, discoveries, patentable or copyrightable matters,
concepts, expertise, patents, copyrights, trade secrets and other
related legal rights utilized in connection with the services
provided and their respective Intellectual Property Rights
therein. The Trust will own its respective right, title, and
interest in and to any and all data, information, records, files,
input materials, reports, and forms received, maintained,
computed, stored, processed, created, or generated on or by the
Distributor Software.
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between PFPC Distributors, Inc. and HighMark Funds
(e) Distributor agrees to use commercially reasonable efforts to
solicit orders for the sale of the Shares and will undertake such
advertising and promotion as it believes reasonable in connection
with such solicitation. To the extent that Distributor receives
fees under any plan adopted by the Trust or any Fund pursuant to
Rule 12b-1 under the 1940 Act, Distributor agrees to furnish
and/or enter into arrangements with others for the furnishing of
marketing or sales services with respect to the Shares as may be
required pursuant to such plan. To the extent that Distributor
receives shareholder services fees under any shareholder services
plan adopted by the Trust or any Fund, Distributor agrees to
furnish and/or enter into arrangements with others for the
furnishing of, personal and/or account maintenance services with
respect to the relevant shareholders of the Fund as may be
required pursuant to such plan. It is contemplated that
Distributor will enter into sales or servicing agreements with
securities dealers, financial institutions, other financial
intermediaries and other investment professionals, such as
investment advisers, accountants and estate planning firms.
Distributor will require each dealer with whom Distributor has a
selling and/or servicing agreement to conform to the applicable
provisions of the Prospectus, with respect to the public offering
price of the Shares, and Distributor shall not cause the Trust to
withhold the placing of purchase orders so as to make a profit
thereby.
(d) Distributor shall not utilize any materials in connection with
the sale or offering of Shares except each Fund's Prospectus and
Statement of Additional Information and such other materials as
the Trust or Fund shall provide or approve. The Trust agrees to
furnish Distributor with sufficient copies of any and all:
agreements, plans, communications with the public, or other
materials which the Trust intends to use in connection any sales
of Shares, in adequate time for Distributor to file and clear
such materials with the proper authorities before they are put in
use. Distributor and the Trust may agree that any such material
does not need to be filed subsequent to distribution. In
addition, the Trust agrees not to use any such materials until so
filed and cleared for use, if required, by appropriate
authorities as well as by Distributor.
(e) Distributor will transmit any orders received by it for purchase
or redemption of the Shares to the transfer agent for the Trust.
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.
(f) No Shares shall be offered by either 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
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between PFPC Distributors, Inc. and HighMark Funds
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 the 1933 Act is not on file with the SEC; provided,
however, that nothing contained in this paragraph 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, Articles of Incorporation, or bylaws.
(g) Distributor undertakes to comply with all applicable requirements
of the Securities Laws and any laws, rules and regulations of
governmental authorities having jurisdiction with respect to the
duties to be performed by Distributor hereunder. Except as
specifically set forth herein, Distributor assumes no
responsibility for such compliance by the Trust or any Fund or
any other entity.
(h) Distributor must obtain prior written consent from the Trust in
the event Distributor or its associates engages, employs, or uses
the service(s) of a third party not located in the United States
of America. No engagement of a third party will relieve
Distributor of its obligations under this Agreement.
4. DUTIES AND OBLIGATIONS OF THE TRUST.
(a) The Trust represents and warrants to Distributor that the Trust
is an investment company registered under the 1940 Act and the
Shares sold by each Fund are, and will be, registered under the
0000 Xxx.
(b) The Trust represents to Distributor that all Registration
Statements and Prospectuses filed by the Trust or any Fund with
the SEC under the 1933 Act with respect to the Shares, to the
best of the Trust's knowledge, have been prepared in conformity
with the requirements of the 1933 Act and the rules and
regulations of the SEC thereunder. Except as to information
included in the Registration Statement in reliance upon
information provided to the Trust or any Fund by Distributor or
any affiliate of Distributor expressly for use in the
Registration Statement, the Trust represents and warrants to
Distributor that, to the best of the Trust's knowledge, 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; that all statements of fact contained in any such
Registration Statement will be true and correct to the best of
the Trust's knowledge when such Registration Statement becomes
effective; and that, to the best of the Trust's knowledge, 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
Underwriting Agreement as of January 1, 2008 Page 5 of 29
between PFPC Distributors, Inc. and HighMark Funds
purchaser of the Shares. Distributor 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 Distributor' counsel, be
necessary or advisable. Distributor shall promptly notify the
Trust 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 that
address Distributor's concerns within thirty (30) days after
receipt by the Trust of a written request from Distributor to do
so, 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 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. The Trust
authorizes Distributor to use any then current Prospectus or
Statement of Additional Information in the form furnished from
time to time in connection with the sale of the Shares.
(c) The net asset value of the Shares shall be determined in the
manner provided in each then current Prospectus and Statement of
Additional Information relating to the Shares, and when
determined shall be applicable to all transactions as provided in
each Prospectus. The net asset value of the Shares shall be
calculated by the Trust or by another entity on behalf of the
Trust. Distributor shall have no duty to inquire into, or
liability for, the accuracy of the net asset value per Share as
calculated.
(d) Whenever in its judgment such action is warranted by unusual
market, economic or political conditions or abnormal
circumstances of any kind, the Trust or any Fund may decline to
accept any orders for, or make any sales of, the Shares until
such time as the Trust or Fund deem it advisable to accept such
orders and to make such sales, and the Trust or Fund advises
Distributor promptly of such determination.
(e) Upon approval by the Trust, the Trust agrees 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 Distributor may designate. The Trust shall notify
Distributor in writing of the states in which the Shares may be
sold and shall notify Distributor in writing of any changes to
the information contained in the previous notification.
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between PFPC Distributors, Inc. and HighMark Funds
(f) The Trust represents and warrants that it will not issue Shares
of Funds that are not in compliance with the applicable
conditions and qualifications set forth in Rule 2830 of the
Conduct Rules of the FINRA, as amended from time to time, which
enable a member of the FINRA to offer or sell shares of the
Funds.
(g) The Trust represents and warrants that it will comply with all
prohibitions on transactions with affiliates of Distributor as
outlined in Sections 12 and 17 of the 1940 Act, in reliance on a
list of affiliates of Distributor that will be provided and
regularly updated by Distributor.
5. COMPENSATION.
(a) As compensation for services rendered by Distributor during the
term of this Agreement the Trust will pay, or cause a Fund or a
Fund's sponsor or advisor to pay, to Distributor a fee or fees as
may be agreed to from time to time in writing (the "Fee Letter")
which is incorporated into this Agreement and may be amended from
time to time.
(b) The Trust acknowledges and agrees that Distributor will be
entitled to the underwriter concession as compensation for its
services as disclosed in each Fund's prospectus.
(c) The Trust acknowledges that Distributor may receive float
benefits and/or investment earnings in connection with
maintaining certain accounts required to provide services under
this Agreement, but only to the extent permitted by law.
(d) The undersigned hereby represents and warrants to Distributor
that (i) the terms of this Agreement, (ii) the fees and expenses
associated with this Agreement, and (iii) to the best of its
knowledge, any benefits accruing to Distributor or sponsor to the
Trust or any Fund in connection with this Agreement, including
but not limited to any fee waivers, conversion cost
reimbursements, up front payments, signing payments or periodic
payments made or to be made by Distributor to such adviser or
sponsor or any affiliate of the Trust relating to this Agreement,
to the extent these benefits present a possible conflict of
interest between any Fund and HighMark Capital Management,
Inc.("HighMark"), have been fully disclosed to the Board of
Trustees of the Trust, if required by law, and that, if required
by applicable law, such Board of Trustees has approved or will
approve the terms of this Agreement, any such fees and expenses,
and any such benefits.
6. DISPUTE RESOLUTION PROCESS.
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between PFPC Distributors, Inc. and HighMark Funds
(a) Each of Distributor and the Trust shall appoint an individual
("EXECUTIVE CONTACT") who shall be the individual responsible for
participating in the dispute resolution process described in this
Section 6. Each Executive Contact shall possess the requisite
corporate power and authority to negotiate and implement, on
behalf of the party he or she represents a settlement of any
dispute between the parties hereunder. Each of Distributor and
the Trust shall have the right from time to time to appoint a
successor to its then-current Executive Contact.
Except with respect to claims for injunctive relief, the
following procedure will be adhered to in all claims, disputes,
and controversies arising out of or in connection with or
relating to this Agreement or the breach or alleged breach of
this Agreement. Upon the occurrence of a breach or default under
this Agreement, the aggrieved Party must send the other Party to
this Agreement ("Receiving Party") written notice of the nature
of the claim, dispute or controversy, with as much detail as
possible regarding the dispute (a "Dispute Notice").
(b) To the extent any provision or Exhibit of this Agreement shall
provide a specific cure period applicable to a specific breach,
and or, a specific remedy applicable to such breach, such
provisions of this Agreement shall govern the breach, unless the
breach is either (i) disputed by a Party or (ii) the cure of the
breach is disputed by a Party. In the event a breach occurs for
which this Agreement does not provide a specific cure period, a
Party shall have thirty (30) days from its receipt of written
notice of the breach to cure the breach. If a breach is disputed
by a Party, or a cure of a breach is disputed by a Party, the
dispute shall be governed by this Section 6 "DISPUTE RESOLUTION
PROCESS".
(c) The respective managers of the parties who are responsible for
the day-to-day management of the relationship contemplated by
this Agreement (the "DESIGNEE MANAGERS") shall meet within ten
days after the date of receipt of the Dispute Notice to attempt
to reach an agreement about the nature of the dispute and a
resolution of the dispute. If the Designee Managers are unable to
resolve the dispute within such time period, the Executive
Contacts of the parties shall meet within thirty days after the
date of receipt of the Dispute Notice to attempt to reach an
agreement about the nature of the dispute and a resolution of the
dispute. If the Executive Contacts cannot resolve the dispute
within such time period or any agreed upon extension, or if the
terms and conditions of the resolution or settlement of the
dispute are breached, either party may institute legal
proceedings or litigation against the other as it deems
necessary. Except with respect to the matter in dispute, pending
resolution of any dispute covered by this Section 6, both parties
will continue their performance under this Agreement including,
without limitation, the Trust's payment of all amounts due to
Distributor.
Underwriting Agreement as of January 1, 2008 Page 8 of 29
between PFPC Distributors, Inc. and HighMark Funds
7. INSTRUCTIONS.
(a) Unless otherwise provided in this Agreement, Distributor shall
act only upon Oral Instructions or Written Instructions.
(b) Distributor shall be entitled to rely upon any Oral Instruction
or Written Instruction it receives from an Authorized Person (or
from a person reasonably believed by Distributor to be an
Authorized Person) pursuant to this Agreement. Distributor may
assume that any Oral Instruction or Written Instruction received
hereunder is not in any way inconsistent with the provisions of
the Trust's organizational documents or this Agreement or of any
vote, resolution or proceeding of the Trust's Board of Trustees
or any of the Fund's shareholders, unless and until Distributor
receives Written Instructions to the contrary.
(c) The Trust agrees to forward to Distributor Written Instructions
confirming Oral Instructions so that Distributor receives the
Written Instructions by the close of business on the same day
that such Oral Instructions are received. The fact that such
confirming Written Instructions are not received by Distributor
or differ from the Oral Instructions shall in no way invalidate
the transactions or enforceability of the transactions authorized
by the Oral Instructions or Distributor' ability to rely upon
such Oral Instructions. Where Oral Instructions or Written
Instructions reasonably appear to have been received from an
Authorized Person, Distributor shall incur no liability to the
Trust or any Fund in acting upon such Oral Instructions or
Written Instructions provided that Distributor' actions comply
with the other provisions of this Agreement.
8. RIGHT TO RECEIVE ADVICE.
(a) ADVICE OF THE TRUST. If Distributor is in doubt as to any action
it should or should not take, Distributor may request directions
or advice, including Oral Instructions or Written Instructions,
from the Trust.
(b) ADVICE OF COUNSEL. If Distributor shall be in doubt as to any
question of law pertaining to any action it should or should not
take, Distributor may request advice from counsel of its own
choosing (who may be counsel for the Trust or the Trust's
investment adviser or counsel for Distributor, at the option of
Distributor). In the event counsel for the Trust or the Trust's
investment adviser responds to such requests from Distributor,
and in connection therewith incurs legal fees or costs, the
parties shall use good faith efforts to equitably and
appropriately allocate such fees or costs; with the understanding
that Distributor shall not be responsible for legal fees or costs
occasioned by Distributor's provision of
Underwriting Agreement as of January 1, 2008 Page 9 of 29
between PFPC Distributors, Inc. and HighMark Funds
services covered by this agreement and in the normal course of
business.
(c) CONFLICTING ADVICE. In the event of a conflict between positions
or advice or Oral Instructions or Written Instructions
Distributor receives from the Trust, and the advice or positions
it receives from counsel, Distributor may rely upon and follow
the advice or positions of counsel. Nothing in this section shall
be construed so as to impose an obligation upon Distributor (i)
to seek such positions or advice or Oral Instructions or Written
Instructions, or (ii) to act in accordance with such positions or
advice unless, under the terms of other provisions of this
Agreement, the same is a condition of Distributor' properly
taking or not taking such action.
9. RECORDS; VISITS.
(a) The books and records pertaining to the Trust or any Fund, which
are in the possession or under the control of Distributor, shall
be the property of the Trust and Fund. Such books and records
shall be prepared and maintained as required by the applicable
Securities Laws and other rules and regulations including FINRA
Conduct Rules. The Trust and Authorized Persons shall have access
to such books and records at all times during Distributor's
normal business hours. Upon the reasonable request of the Trust
or any Fund, copies of any books and records shall be provided by
Distributor to the Trust or to an Authorized Person, at the
Trust's reasonable expense.
(b) Upon termination or expiration of this Agreement, all documents
(including any tangible media) related to this Agreement or the
services provided hereunder shall be handled as follows:
(i) Distributor shall retain the books and records of the Trust
specifically related to this Agreement and shall cooperate
in making such books and records available to regulatory
authorities upon request;
(ii) Each party shall retain the documents it is required by law
to maintain;
(iii) Documents not covered by (i) or (ii) above shall be
returned to the party who owns the documents to the extent
such party so requests, or destroyed to the extent such
party requests destruction; provided that, any request for
return or destruction is made within 90 days after the
expiration or termination of this Agreement;
(iv) All documents related to this Agreement or the services
provided hereunder, retained by a party after termination or
expiration of this
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between PFPC Distributors, Inc. and HighMark Funds
Agreement, that contain Confidential Information of the
other party, shall be maintained subject to the provisions
of Section 10 of this Agreement;
(v) Either party may request a copy of any document related to
this Agreement or the services provided hereunder retained
by the other party after termination or expiration of this
Agreement; provided that, the party making the request
reimburses the other party for the reasonable copying cost;
and
(vi) Notwithstanding any other provision of this Section 9(b),
any document related to this Agreement or the services
provided hereunder, retained by a party after termination or
expiration of this Agreement, may be destroyed by such party
according to its normal records destruction schedule,
provided that such schedule is consistent with applicable
law.
10. CONFIDENTIALITY.
Each party shall keep confidential any confidential or proprietary
information relating to the other party's business ("Confidential
Information").
(a) Confidential Information shall include, but not be limited to,
(i) any data or information that is competitively sensitive
material, and not generally known to the public, including, but
not limited to, information about product plans, marketing
strategies, finances, operations, customer relationships,
customer profiles, customer lists, sales estimates, business
plans, processes, policies and procedures for marketing, sales,
and customer service and support activities, financial service
pricing and profitability; customer and vendor contracts and
related documents, and internal performance results relating to
the past, present or future business activities of the Trust, or
Distributor, their respective subsidiaries and affiliated
companies; (ii) any scientific or technical information, design,
process, procedure, formula, or improvement that is commercially
valuable and secret in the sense that its confidentiality affords
the Trust or Distributor a competitive advantage over its
competitors; (iii) all confidential or proprietary concepts,
documentation, reports, data, specifications, computer software,
source code, object code, flow charts, databases, inventions,
know-how, and trade secrets, whether or not patentable or
copyrightable; (iv) the names, addresses, telephone and facsimile
numbers, financial data, e-mail addresses, and any other
"Non-Public Personal Information" as that term is used in the
Xxxxx-Xxxxx-Xxxxxx Act of 1999 (the "Act"), regarding Fund
shareholders or its affiliates' customers, or prospective
customers; (v) all trading information, portfolio holdings
information, investment models, asset allocation models, and any
similar
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between PFPC Distributors, Inc. and HighMark Funds
information related to any Fund; and (vi) anything designated as
confidential by Distributor or the Trust, in its sole and
absolute discretion.
(b) Confidential Information does not include any information that
(i) is in the public domain, other than as a result of breach by
the recipient of the information of its obligations under this
Agreement, (ii) is already known to the receiving party at the
time it is obtained; or (iii) has been or is independently
developed or obtained by the receiving party, without reference
to any of the other party's Confidential Information.
(c) The Trust hereby informs Distributor that (i) its investment
adviser, HighMark, is subject to the consumer and customer
privacy provisions of the Act and Federal regulations that
implement the Act (the "Regulation"); (ii) the Confidential
Information covered by this Agreement may include Non-Public
Personal Information as defined in the Regulation; and (iii) that
HighMark and the Trust have certain obligations to protect the
Confidential Information from unauthorized disclosure to third
parties. Distributor understands that Distributor's willingness
and ability to reasonably cooperate with and assist HighMark and
the Trust in this regard is a material factor in the Trust's
willingness to enter into this Agreement, and such other
agreements as the Trust may enter into, or have entered into,
with Distributor through which agreements Confidential
Information will be released from the Trust to Distributor.
Distributor acknowledges that in the course of performing duties
for the Trust it may receive, or otherwise have access to, data
that may be Confidential Information of HighMark or the Trust.
Distributor warrants that it has developed and implemented
procedures reasonably designed to prevent the improper release of
Confidential Information of HighMark or the Trust as required by
the Act.
(d) Specifically, and not by way of limitation, each party shall: (i)
maintain Confidential Information of the other party in physical
and electronically secure media and facilities, subject to
commercially reasonable security procedures; (ii) not use, nor
permit its employees, agents, consultants or affiliates to use,
such Confidential Information for any purpose whatsoever except
as permitted by this Agreement or as required by applicable law;
(iii) neither use, nor permit use of, such data for any sales or
marketing purposes; and (iv) make and enforce policies and
procedures in hiring, training and supervision and monitoring of
its staff, agents and consultants in proper handling and
protection of Confidential Information., Neither party shall
permit its employees or agents to download, use or maintain
Confidential Information on laptops or other personal portable
devices unless such information is encrypted with a reasonable
level of encryption protection.
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between PFPC Distributors, Inc. and HighMark Funds
(e) The Trust hereby informs Distributor that the Trust is a
registered investment company. Distributor hereby informs the
Trust that Distributor is a registered broker-dealer and
affiliated with a national bank. As such, each of the Trust and
Distributor is charged with a high standard with respect to its
own, and its customers', personal and financial data, and,
further, that such data can be misused if not treated
appropriately; and, therefore, breach of any provision of this
Agreement by a party may expose the other party to extraordinary
reputational, financial, and market risks, and to risk of
regulatory action, for which there is no adequate remedy at law
or by way of damages alone. Therefore, each party stipulates and
agrees that in the event of any allegation of violation, or
allegation of any threatened violation, by it of the provisions
of this Section 10, a temporary restraining order, or preliminary
and/or permanent injunction, as the case may be, may forthwith
issue upon showing of probable cause of such actual or threatened
breach, such order to prohibit the use, copying, retention, or
release of any such data in violation hereof.
(f) Confidential Information may be disclosed under the following
circumstances, provided that reasonable steps are taken in the
respective circumstances to ensure that the party to whom the
information is disclosed will maintain the confidentiality of the
information: (i) Disclosure is required pursuant to a court
order, subpoena, governmental or regulatory agency request or
law; (ii) Disclosure is made in the good faith belief that it is
materially relevant to the defense of a claim or cause of action
asserted against the disclosing party, provided that the written
consent of the other party has been obtained, unless the action
is between the parties and/or a Fund); (iii) Disclosure is made
in connection with an independent third party compliance or other
review; or (iv) Disclosure is necessary or appropriate in
connection with the provision of services under this Agreement.
(g) Distributor shall notify the Trust of any security breach of
information covered under California Civil Code Section 1798.82
in the most expedient time possible and without unreasonable
delay, so as to enable the Trust to comply with Section 1798.82.
Written confirmation must be sent within forty-eight (48) hours
of Distributor's confirmation of such a security breach.
Distributor shall notify the Trust of any other confirmed
security breach of Confidential Information promptly following
discovery.
(h) Distributor agrees to provide the Trust written details regarding
Distributor's internal investigation regarding any security
breach. The Trust, at its reasonable discretion, may request
Distributor undertake a second more in-depth investigation
concerning specific aspects of the breach, and Distributor will
undertake commercially reasonable efforts to so, and will provide
to the Trust results of its findings. Distributor shall not
notify any regulatory authority on
Underwriting Agreement as of January 1, 2008 Page 13 of 29
between PFPC Distributors, Inc. and HighMark Funds
behalf of the Trust unless the Trust specifically requests in
writing that Distributor do so. For the avoidance of doubt, the
foregoing sentence shall not prevent Distributor from making
notifications to law enforcement agencies or any regulatory or
governmental agencies with jurisdiction over Distributor.
Distributor and the Trust shall work together to formulate a plan
reasonably designed to prevent similar security breaches. In the
event the Trust determines with reasonable likelihood that a
misuse of Customer Information has occurred, Distributor shall
reasonably cooperate with the Trust in attempting to rectify said
breach, which may include notifying any Fund customers as the
Trust reasonably deems affected. Distributor and the Trust shall
jointly prepare a customer notice. All costs and expenses
reasonably incurred by the Trust as a direct result of a security
breach shall be borne by Distributor to the extent the breach is
caused by Distributor's failure to maintain the Standard of Care
(as defined below) in the performance of its duties under this
Agreement.
(i) The provisions of this Section 10 shall survive termination of
this Agreement.
11. STANDARD OF CARE/LIMITATIONS OF LIABILITY
(a) Distributor shall use commercially reasonable efforts in the
performance of its services under this Agreement; provided that,
subject to the terms of this Section 11, Distributor shall be
liable to the Trust (or any person or entity claiming through the
Trust) for damages only to the extent caused by Distributor's own
willful misfeasance, bad faith, gross negligence or reckless
disregard of its duties under this Agreement ("STANDARD OF
CARE").
(b) Neither Distributor nor the Trust shall be liable for (i) any
consequential, incidental, exemplary, punitive or special
damages, or loss of profits arising out of or in connection with
either party's respective obligations under this Agreement,
whether or not the likelihood of such damages was known by such
party; (ii) any damages that either party is required to pay for
any reason whatsoever and regardless of the form of action, shall
not exceed, in the aggregate, actual proven direct damages; and
(iii) any damages (including without limitation damages caused by
delays, failure, errors, interruption or loss of data) occurring
directly or indirectly by reason of circumstances beyond its
reasonable control, including without limitation acts of God;
action or inaction of civil or military authority; national
emergencies; public enemy; war; terrorism; riot; fire; flood;
catastrophe; sabotage; epidemics; labor disputes; civil
commotion; interruption, loss or malfunction of utilities,
transportation, computer or communications capabilities;
insurrection; elements of nature; non-performance by a third
party (except a third
Underwriting Agreement as of January 1, 2008 Page 14 of 29
between PFPC Distributors, Inc. and HighMark Funds
party directly or indirectly retained by such party); failure of
the mails; or functions or malfunctions of the internet,
firewalls, encryption systems or security devices caused by any
of the above; provided that Distributor uses commercially
reasonable efforts to implement its business resumption plan as
soon as practicable.
(c) Distributor shall not be under any duty or obligation to inquire
into and shall not be liable for the validity or invalidity,
authority or lack thereof, or truthfulness or accuracy or lack
thereof, of any instruction, direction, notice, instrument or
other information which Distributor reasonably believes to be
genuine. Distributor shall not be liable for any damages that are
caused by actions or omissions taken by Distributor in accordance
with Written Instructions or advice of counsel. Distributor shall
not be liable for any damages to the extent arising out of any
action or omission to act by any prior service provider of the
Trust's or for any failure to discover any such error or omission
despite reasonable diligence.
(d) Neither party may commence an action (e.g. lawsuit or
arbitration) against the other party or any of its affiliates
more than 18 months after the date upon which such party
discovered (or, exercising reasonable diligence, should have
discovered) the facts upon which such action is based.
(e) Each party shall have a duty to mitigate damages for which the
other party may become responsible.
(f) This Section 11 shall survive termination of this Agreement.
12. INDEMNIFICATION.
(a) Unless Distributor fails to meet its Standard of Care (defined in
Section 11 above), the Trust agrees to indemnify, defend and hold
harmless Distributor and its affiliates from all claims, suits,
actions, damages, losses, liabilities, obligations, costs and
reasonable expenses (including reasonable attorneys' fees and
court costs, travel costs and other reasonable out-of-pocket
costs related to dispute resolution) arising directly or
indirectly from any action taken or omitted to be taken by
Distributor in connection with the provision of services to the
Trust.
(b) Unless Distributor fails to meet its Standard of Care (defined in
Section 11 above), the Trust agrees to indemnify, defend and hold
harmless Distributor, its officers, directors, and employees, and
any person who controls Distributor within the meaning of Section
15 of the 1933 Act, free and harmless from and against any and
all claims, costs, expenses, losses, damages, charges, payments
and liabilities of any sort or kind (including reasonable
attorneys' fees) which
Underwriting Agreement as of January 1, 2008 Page 15 of 29
between PFPC Distributors, Inc. and HighMark Funds
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: (i) any untrue statement, or alleged untrue statement, of a
material fact contained in any Registration Statement,
Prospectus, Statement of Additional Information, or sales
literature (including amendments and supplements thereto), or
(ii) any omission, or alleged omission, to state a material fact
required to be stated in any 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 or any Fund by
Distributor or its affiliated persons for use in the Fund's
Registration Statement, Prospectus, or Statement of Additional
Information or sales literature (including amendments or
supplements thereto), such indemnification is not applicable;
(c) The Trust acknowledges and agrees that in the event that
Distributor, at the request of the Trust or any Fund, is required
to give indemnification comparable to that set forth in this
paragraph to any broker-dealer or other financial intermediary
selling Shares of the Funds or servicing the shareholders of the
Funds and such broker-dealer or financial intermediary shall make
a claim for indemnification against Distributor, Distributor
shall make a similar claim for indemnification against the Trust.
(d) Distributor agrees to indemnify and hold harmless the Trust and
each Fund, its several officers, Trustees, and each person, if
any, who controls a Fund within the meaning of Section 15 of the
1933 Act, against any and all claims, suits, actions,
obligations, costs, expenses, losses, damages, charges, payments
and liabilities of any sort or kind (including reasonable
attorneys' fees and court costs, travel costs and any reasonable
out-of-pocket costs related to dispute resolution), which the
Trust, its officers, Board Members or any such controlling person
may incur (i) arising from Distributor's failure to perform its
duties under this Agreement according to the Standard of Care, or
(ii) arising under the 1933 Act, under any other statute, at
common law or otherwise; PROVIDED, HOWEVER, Distributor is
obligated to indemnify under this sub-section d(ii) only to the
extent that such liability or expense arose out of and is based
upon (i) the acquisition of any Shares by any person; (ii) which
may be based upon any untrue statement of a material fact
contained in any Registration Statement, Prospectus or Statement
of Additional Information (including amendments and supplements
thereto), or any omission to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading; and (iii) such untrue statement or omission
Underwriting Agreement as of January 1, 2008 Page 16 of 29
between PFPC Distributors, Inc. and HighMark Funds
was made in reliance upon information furnished or confirmed in
writing to the Trust or Fund by Distributor or its affiliated
persons (as defined in the 1940 Act). The foregoing rights of
indemnification shall be in addition to any other rights to which
the Fund or any such person shall be entitled to as a matter of
law.
(e) In any case in which one party hereto (the "Indemnifying Party")
may be asked to indemnify or hold the other party hereto (the
"Indemnified Party") harmless, the Indemnified Party will notify
the Indemnifying Party promptly after identifying any situation
which it believes presents or appears likely to present a claim
for indemnification (an "Indemnification Claim") against the
Indemnifying Party, although the failure to do so shall not
prevent recovery by the Indemnified Party, and shall keep the
Indemnifying Party advised with respect to all developments
concerning such situation. The Indemnifying Party shall have the
option to defend the Indemnified Party against any
Indemnification Claim which may be the subject of this
indemnification, and, in the event that the Indemnifying Party so
elects, such defense shall be conducted by counsel chosen by the
Indemnifying Party and reasonably satisfactory to the Indemnified
Party, and thereupon the Indemnifying Party shall take over
complete defense of the Indemnification Claim and the Indemnified
Party shall sustain no further legal or other expenses in respect
of such Indemnification Claim. In the event that the Indemnifying
Party does not elect to assume the defense of any such suit, or
in case the Indemnified Party reasonably does not approve of
counsel chosen by the Indemnifying Party, or in case there is a
conflict of interest between the Indemnifying Party or the
Indemnified Party, the Indemnifying Party will reimburse the
Indemnified Party for the fees and expenses of any counsel
retained by the Indemnified Party. The Trust agrees promptly to
notify Distributor of the commencement of any litigation or
proceedings against the Trust or any Fund or any of its officers
or trustees in connection with the issue and sale of any Shares.
The Indemnified Party will not confess any Indemnification Claim
or make any compromise in any case in which the Indemnifying
Party will be asked to provide indemnification, except with the
Indemnifying Party's prior written consent.
(f) LEGAL ACTION AGAINST INDEMNIFICATION PARTY:
(i) NOTICE OF THE ACTION. A party that seeks indemnification
under this Agreement must promptly give the other party
notice of any legal action. But a delay in notice does not
relieve an indemnifying party of any liability to an
indemnified party, except to the extent the indemnifying
party shows that the delay prejudiced the defense of the
action.
Underwriting Agreement as of January 1, 2008 Page 17 of 29
between PFPC Distributors, Inc. and HighMark Funds
(ii) PARTICIPATING IN OR ASSUMING THE DEFENSE. The indemnifying
party may participate in the defense at any time or it may
assume the defense by giving notice to the other party.
After assuming the defense, the indemnifying party: (1) must
select an attorney that is satisfactory to the other party
(but the other party must not unreasonably withhold its
consent); (2) is not liable to the other party for any later
attorney's fees or for any other later expenses that the
other party incurs, except as approved by the indemnifying
party; (3) must not compromise or settle the action without
the other party's consent (but the other party must not
unreasonably withhold its consent); and (4) is not liable
for any compromise or settlement made without its consent,
which shall not be unreasonably withheld.
(iii) FAILING TO ASSUME THE DEFENSE. If the indemnifying party
fails to participate in or assume the defense within 30 days
after receiving notice of the action, the indemnifying party
is bound by any determination made in the action or by any
compromise or settlement made by the other party.
(g) This Section 12 shall survive termination of this Agreement.
13. DURATION AND TERMINATION.
(a) This Agreement shall become effective on the date first written
above and, unless sooner terminated as provided herein, shall
continue for an initial one-year term and thereafter shall be
renewed for successive one-year terms, provided 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, 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 (60) 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 Distributor. This Agreement
may be terminated with respect to one or more Funds, or with
respect to the entire Trust. This Agreement will also terminate
automatically in the event of its assignment (as defined in the
1940 Act and the rules thereunder).
(b) Upon the termination of this Agreement as set forth in this
section, and upon HighMark's written request, Distributor shall,
if requested by HighMark, make a good faith effort to facilitate
a conversion to HighMark's successor service
Underwriting Agreement as of January 1, 2008 Page 18 of 29
between PFPC Distributors, Inc. and HighMark Funds
provider; provided that Distributor does not guarantee that it
will be able to effect a conversion on the date(s) requested by
HighMark.
14. NOTICES.
All notices hereunder shall be given in writing (and shall be deemed
to have been duly given upon receipt) and delivered in person, by
telecopy, by registered or certified mail or by overnight delivery
(postage prepaid, return receipt requested) to the persons listed
below at the following addresses:
To Distributor:
PFPC Distributors, Inc.
000 Xxxxx Xxxx
Xxxx xx Xxxxxxx, XX 00000
Attention: Xxxxx Xx Xxxxxxx
With a copy to:
Xxxx Xxxxxxx
Chief Legal Officer
PFPC Distributors, Inc.
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
To the Trust:
The HighMark Funds
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: President
If notice is sent by confirming telegram, cable, telex or facsimile
sending device, it shall be deemed to have been given immediately. If
notice is sent by first-class mail, it shall be deemed to have been
given three days after it has been mailed. If notice is sent by
messenger, it shall be deemed to have been given on the day it is
delivered.
15. AMENDMENTS.
This Agreement, or any term thereof, may be changed or waived only by
a written amendment, signed by both parties.
Underwriting Agreement as of January 1, 2008 Page 19 of 29
between PFPC Distributors, Inc. and HighMark Funds
16. ASSIGNMENT.
Distributor may assign its rights hereunder to any majority-owned
direct or indirect subsidiary of Distributor or of The PNC Financial
Services Group, Inc. to the extent permitted by the 1940 Act and the
rules thereunder. The Trust may also assign its rights hereunder to
the extent permitted by the 1940 Act and the rules thereunder. Any
other assignment will result in immediate termination of this
Agreement.
17. NON-SOLICITATION.
During the term of this Agreement and for one year thereafter, neither
party shall (with the exceptions noted in the immediately succeeding
sentence) knowingly solicit or recruit for employment or hire any of
the other party's employees without prior written consent of that
party. To "knowingly" solicit, recruit or hire within the meaning of
this provision does not include, and therefore does not prohibit,
solicitation, recruitment or hiring of an employee if that employee
was identified by such entity solely as a result of the employee's
response to a general advertisement by such entity in a publication of
trade or industry interest or other similar general solicitation by
such entity.
18. COUNTERPARTS.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
19. FURTHER ACTIONS.
Each party agrees to perform such further acts and execute such
further documents as are necessary to effectuate the purposes hereof.
20. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement embodies the entire agreement
and understanding between the parties and supersedes all prior
agreements and understandings relating to the subject matter
hereof, provided that the parties may embody in one or more
separate documents their agreement, if any, with respect to
delegated duties.
(b) NO CHANGES THAT MATERIALLY AFFECT OBLIGATIONS. Notwithstanding
anything in this Agreement to the contrary, the Trust agrees to
notify Distributor of any
Underwriting Agreement as of January 1, 2008 Page 20 of 29
between PFPC Distributors, Inc. and HighMark Funds
modifications made to its registration statement or a any Fund or
HighMark policies which would affect Distributor's
responsibilities under this Agreement; provided that Distributor
shall not be bound by any such modifications which, in either
case, would affect materially the obligations or responsibilities
of Distributor hereunder unless Distributor shall have accepted
such modifications, which approval shall not be unreasonably
withheld.
(c) CAPTIONS. 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.
(d) INFORMATION. The Trust will provide such information and
documentation as Distributor may reasonably request in connection
with services provided by Distributor to the Trust or any Fund.
(e) GOVERNING LAW. This Agreement shall be deemed to be a contract
made in Delaware and governed by Delaware law, without regard to
principles of conflicts of law. The prevailing party in any
lawsuit brought under this Agreement shall be entitled to its
costs of suit including reasonable attorney's fees. For purposes
of this provision, a party shall be deemed to be the "prevailing
party" with respect to an action only if the tribunal deciding
such action determines that such party has prevailed on a
substantial portion of its claims in such action such that it is
equitable for such party to be awarded attorneys' fees and court
costs.
(f) PARTIAL INVALIDITY. 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.
(g) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns. Except as may be
explicitly stated in this Agreement, (i) this Agreement is not
for the benefit of any other person or entity and (ii) there
shall be no third party beneficiaries hereof except for HighMark.
(h) NO REPRESENTATIONS OR WARRANTIES. Except as expressly provided in
this Agreement, Distributor hereby disclaims all representations
and warranties, express or implied, made to the Trust or any
other person, including, without limitation, any warranties
regarding quality, suitability, merchantability, fitness for a
particular purpose or otherwise (irrespective of any course of
dealing, custom or usage of trade), of any services or any goods
provided incidental to services provided under this Agreement.
Distributor disclaims any warranty of title or non-infringement
except as otherwise set forth in this Agreement.
Underwriting Agreement as of January 1, 2008 Page 21 of 29
between PFPC Distributors, Inc. and HighMark Funds
(i) FACSIMILE SIGNATURES. The facsimile signature of any party to
this Agreement shall constitute the valid and binding execution
hereof by such party.
(j) CUSTOMER IDENTIFICATION PROGRAM NOTICE. To help the U.S.
government fight the funding of terrorism and money laundering
activities, U.S. Federal law requires each financial institution
to obtain, verify, and record certain information that identifies
each person who initially opens an account with that financial
institution on or after October 1, 2003. Consistent with this
requirement, Distributor will request (or already has requested)
the Fund's name, address and taxpayer identification number or
other government-issued identification number, and, if such party
is a natural person, that party's date of birth. Distributor may
also ask (and may have already asked) for additional identifying
information, and Distributor may take steps (and may have already
taken steps) to verify the authenticity and accuracy of these
data elements.
(k) MASSACHUSETTS BUSINESS TRUST. The names "HighMark Funds" and
"Board of Trustees" refer respectively to the trust created and
the Trustees, as trustees but not individually or personally,
acting from time to time under a Declaration of Trust dated as of
March 10, 1987 to which reference is hereby made and a copy of
which is on file at the office of the Secretary of The
Commonwealth of Massachusetts and elsewhere as required by law,
and to any and all amendments thereto so filed or hereafter
filed. The obligations "HighMark Funds" entered into in the name
or on behalf thereof by any of the Trustees, representatives or
agents are made not individually, but in such capacities, and are
not binding upon any of the Trustees, interest holders or
representatives of the Trust personally, but bind only the assets
of the Trust, and all persons dealing with any series of the
Trust must look solely to the assets of such series for the
enforcement of any claims against the Trust with respect to such
series.
(l) WAIVER OF JURY TRIAL. THE PARTIES HEREBY AGREE TO WAIVE THEIR
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
RELATING TO OR ARISING OUT OF THIS AGREEMENT. THE SCOPE OF THE
WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT
MATTER HEREIN, INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS,
TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND
STATUTORY CLAIMS. THE PARTIES EACH ACKNOWLEDGE THAT THE WAIVER IS
A MATERIAL INDUCEMENT FOR EACH PARTY TO ENTER INTO A BUSINESS
RELATIONSHIP, THAT EACH PARTY HAS ALREADY RELIED ON THE WAIVER IN
ENTERING INTO THIS AGREEMENT AND THAT
Underwriting Agreement as of January 1, 2008 Page 22 of 29
between PFPC Distributors, Inc. and HighMark Funds
EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE
DEALINGS. EACH PARTY FURTHER WARRANTS AND REPRESENTS THAT EACH
HAS HAD THE OPPORTUNITY TO HAVE LEGAL COUNSEL REVIEW THE WAIVER.
THE WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED
EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO
THIS AGREEMENT. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE
FILED AS WRITTEN CONSENT TO A TRIAL BY COURT.
IN WITNESS WHEREOF, the parties hereto have caused this Underwriting
Agreement to be executed as of the day and year first above written.
PFPC DISTRIBUTORS, INC.
By: /s/ Xxxxx Xx Xxxxxxx
------------------------------------
Title: Vice President
---------------------------------
HIGHMARK FUNDS
By: /s/ Xxxxx X. Xxxx XX
------------------------------------
Title: President and CEO
---------------------------------
Underwriting Agreement as of January 1, 2008 Page 23 of 29
between PFPC Distributors, Inc. and HighMark Funds
EXHIBIT A
THIS EXHIBIT A, dated as of January 1, 2008, is Exhibit A to that certain
Underwriting Agreement dated as of January 1, 2008, between PFPC Distributors,
Inc. and the HighMark Funds, a Massachusetts business trust.
PORTFOLIOS
HighMark Balanced Fund
HighMark Cognitive Value Fund
HighMark Core Equity Fund
HighMark Enhanced Growth Fund
HighMark International Opportunities Fund
HighMark Large Cap Growth Fund
HighMark Large Cap Value Fund
HighMark Small Cap Advantage Fund
HighMark Small Cap Value Fund
HighMark Value Momentum Fund
HighMark Capital Growth Allocation Fund
HighMark Diversified Equity Allocation Fund
HighMark Growth & Income Allocation Fund
HighMark Income Plus Allocation Fund
HighMark Bond Fund
HighMark California Intermediate Tax-Free Bond Fund
HighMark National Intermediate Tax-Free Bond Fund
HighMark Short Term Bond Fund
HighMark California Tax-Free Money Market Fund
HighMark Diversified Money Market Fund
HighMark U. S. Government Money Market Fund
HighMark 100% U. S. Treasury Money Market Fund
Underwriting Agreement as of January 1, 2008 Page 24 of 29
between PFPC Distributors, Inc. and HighMark Funds
EXHIBIT B
THIS EXHIBIT B, dated as of January 1, 2008 is a part of that certain
Underwriting Agreement dated as of January 1, 2008 between PFPC Distributors,
Inc. and the HighMark Funds, a Massachusetts business trust.
OFFICERS OF THE HIGHMARK FUNDS
President Xxxxx X. Xxxx XX
Treasurer Xxxxxx X. X'Xxxxxxx
Vice President &
Assistant Secretary R. Xxxxxxx Xxxxx
Underwriting Agreement as of January 1, 2008 Page 25 of 29
between PFPC Distributors, Inc. and HighMark Funds
EXHIBIT C
THIS EXHIBIT C, dated as of January 1, 2008 is a part of that certain
Underwriting Agreement dated as of January 1, 2008 between PFPC Distributors,
Inc. and the HighMark Funds, a Massachusetts business trust.
Additional Contract Provisions
I. PROPERTY RIGHTS
(a) Except as otherwise provided by law or otherwise stated herein, any
intellectual property created by Distributor, its employees or agents during the
term of the Agreement and as part of its duties under this Agreement are the
property of the Trust; except that the following property shall be excluded: (i)
computer or systems code, software, systems, manuals, procedures and similar
property, (ii) policies, procedures or processes developed by Distributor with
the intention that such property be applicable to other clients as well as to
the Trust, and any property reflecting same, and (iii) ideas, concepts, rights
of copyright, patent or trade secrets related to any of the foregoing.
Distributor hereby assigns to the Trust all proprietary rights in any
Trust-owned property, including rights of copyright, patent or trade secrets,
and Distributor agrees to take any other action reasonably necessary to confirm
the Trust's ownership of such Trust-owned property at the Trust's expense.
Distributor hereby grants the Trust a non-exclusive license to use any property
described in item (ii) above to the extent it constitutes books and records of
the Trust or spreadsheet format after the termination or expiration of this
Agreement, but only in connection with servicing the Trust.
(b) Distributor shall not acquire any intellectual property rights in any
property transferred by the Trust to Distributor in connection with this
Agreement. The Trust shall not acquire any intellectual property rights in any
Distributor intellectual property whether or not created in connection with this
Agreement.
(c) Distributor hereby warrants during the term of this Agreement that to
Distributor's knowledge, the Trust's use of any Distributor intellectual
property furnished to the Trust in connection with this Agreement shall not
infringe any copyright, trade secret, trademark, or trade dress right and that
such property is not subject to any security interest held by any third party.
II. INSURANCE.
Without limiting Distributor's liability to the Trust or third parties
hereunder, Distributor agrees to maintain the following insurance coverages
with insurance carriers with A.M. Best rating of at least A- VII, or
otherwise acceptable to HCM, in HCM's sole discretion:
Underwriting Agreement as of January 1, 2008 Page 26 of 29
between PFPC Distributors, Inc. and HighMark Funds
(a) REQUIRED COVERAGE.
(i) All insurance coverages required by federal and state law and
statute having jurisdiction over Distributor, including Worker's
Compensation Insurance and Employers' Liability Insurance. The
Employers' Liability Insurance shall have a minimum coverage of at
least $500,000 for each person;
(ii) Comprehensive or Commercial General Liability Insurance,
including coverage for Products and Completed Operations, and
Blanket Contractual Liability for obligation undertaken by
Distributor to the Trust under this Agreement. Such Comprehensive
General Liability Insurance shall provide for minimum Combined
Bodily Injury and Property Damage Coverage Limits of at least
$3,000,000, per occurrence, and name the Trust as Additional
Insured;
(iii) Comprehensive Automobile Liability Insurance including
coverage for Hired & Non-Owned Automobile Liability, with Combined
bodily Injury and Property Damage Coverage Limits, per occurrence,
of at least $1,000,000, naming the Trust as Additional Insured;
and
(iv) Comprehensive Crime Policy (CCP) including Employees
Dishonest/Fidelity Coverage for all Distributor's employees,
officers and agents, and On-Premises (Loss Inside the Premises)
and In-Transit (Loss Outside the Premises). The CCP shall have a
minimum of at least $2,500,000, per occurrence.
(v) Professional Liability Coverage (Errors and Omissions) for a
minimum coverage of at least $2,500,000 per occurrence.
(b) PRIMARY & NON-CONTRIBUTING ENDORSEMENT. All insurance must include
a Primary & Non-Contributing Endorsement.
(c) CERTIFICATES OF INSURANCE. Prior to performance of any services or
commencement of any work under this Agreement, Distributor shall
furnish to the Trust Certificates of Insurance evidencing such
required insurance coverages and naming the Trust as Additional
Insured (for coverages required by items (ii) and (iii) above). Said
Certificates will include a provision whereby the Insurance Carrier is
required to provide, directly to the Trust, thirty (30) days advance
written notice before termination, change or cancellation of coverage
takes effect for such policies evidenced on such Certificate,
regardless of whether canceled by PFPC Distributors, the Insured, or
the Insurance Carrier.
(d) Distributor may maintain the coverages set forth above through its
affiliates. A deductible provision may be included in each coverage
above in an amount determined in the sole discretion of Distributor's
affiliates. Distributor may elect at any time, subject to thirty (30)
days advance written notice to the Trust during this Agreement, to
terminate any of the above non-statutory coverage to self-insure on
the basis of the financial strength of Distributor and its affiliates
without it constituting a breach or violation of this Agreement.
Notwithstanding the foregoing, Distributor shall not take any action
under this sub-section
Underwriting Agreement as of January 1, 2008 Page 27 of 29
between PFPC Distributors, Inc. and HighMark Funds
II(d) that will materially diminish the protection afforded to HCM by
the coverages otherwise required in this Section II.
III. RIGHT TO AUDIT:
During the term of this Agreement, the Trust and the Trust's federal
and state governmental regulators shall have the right, upon
reasonable notice, and at times mutually agreeable to the Trust and
Distributor:
(a) to receive from Distributor annual audited financial reports;
(b) to enter Distributor premises or such other premises where
Distributor's data is stored, within site security guidelines, for the
purpose of verifying data security access procedures and operational
processes; provided that any such visits shall be made in coordination
with Distributor, and such visits shall be performed in a manner
designed not to unreasonably interrupt or unreasonable disrupt
Distributor's business.
(c) to review, participate in, and test in Distributor's contingency
planning for the sole purpose of determining that the services that
are subject of this Agreement can be restored within an acceptable
timeframe. Distributor shall have: a) documented contingency plan; b)
the ability to recover at a location separate from its normal
production center; c) conducted an exercise of the plan within the
last 12 months; d) updated the plan within the last 12 months,
recuringly; and e) the ability to recover critical services within
timeframes congruent to Distributor's current Business Resiliency
Program requirements.
Should any such audit request or visits by the Trust take more than an
amount of Distributor time per year that is reasonably necessary for
Distributor to assist the Trust in accomplishing the purposes set
forth in this Section III, then the Trust shall pay Distributor for
each additional hour of such Distributor service in response to an
audit at a commercially reasonable standard time and materials rate.
The previous sentence shall not apply to annual audits pursuant to the
SEC's Rule 38a-1 or audits or visits by any regulator or any
governmental agency.
IV. BACKGROUND CHECKS
Distributor warrants that all newly hired employees of Distributor are
fingerprinted, and their prints are sent to the FBI for processing to determine
if they have ever been convicted of, plead guilty or nolo contendere to, or
entered a pre-trial disposition program (after November 28, 1999) with regard to
a crime involving dishonesty, breach of trust or money laundering (as those
terms are defined in the FDIC's current Statement of Policy). Any employee found
as a result to have committed any such crime (other than one that is considered
de minimus under the FDIC's
Underwriting Agreement as of January 1, 2008 Page 28 of 29
between PFPC Distributors, Inc. and HighMark Funds
Statement of Policy) will not be permitted to perform services under this
Agreement for the Trust.
V. TRAVEL POLICY
The Trust will reimburse Distributor for all preapproved travel and
out-of-pocket expenses related to travel solely in connection with services
provided under this Agreement. The Trust's written consent shall not be
unreasonably withheld. Notwithstanding the foregoing, the Trust may require as a
condition of its consent that any Distributor travel and out-of-pocket expenses
must materially comply with the provisions of any travel policy or expense
reimbursement policy of HighMark as communicated to Distributor from time to
time.
Underwriting Agreement as of January 1, 2008 Page 29 of 29
between PFPC Distributors, Inc. and HighMark Funds
