EX-99.e.2.
ABERDEEN FUNDS
DISTRIBUTION AGREEMENT
AGREEMENT made as of the ___ day of ____________, by and between
_____________., a _____________ _____________________ that acts as an open-end
investment company, with its principal office and place of business at
____________________ (the "Client"), and Foreside Fund Services, LLC, a Delaware
limited liability company with its principal office and place of business at Two
Xxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxx 00000 ("Foreside").
WHEREAS, the Client is each registered under the 1940 Act (as defined
below) as an open-end management investment company that issues or intends to
issue shares of beneficial interest (the "Shares"), in separate funds and
classes;
WHEREAS, the Client offers Shares in the funds as listed in Schedule 1
hereto (the funds, together with all other funds subsequently established by the
Client and made subject to this Agreement in accordance with Section 7.5 of this
Agreement being herein referred to as a "Fund," and collectively as the "Funds")
and the Client intends to offer shares of various classes of each Fund as listed
in Schedule 1 hereto (each such class together with all other classes
subsequently established by the Client in a Fund in accordance with Section 7.5
of this Agreement being herein referred to as a "Class," and collectively as the
"Classes"); and
WHEREAS, the Client desires that Foreside offer, as distributor, the Shares
of each Fund and Class thereof to the public and Foreside is willing to provide
those services on the terms and conditions set forth in this Agreement in order
to promote the growth of the Funds and facilitate the distribution of the
Shares;
NOW THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, the Client and Foreside hereby agree as follows:
SECTION 1. DEFINITIONS; APPOINTMENT; DELIVERY OF DOCUMENTS
1.1 Frequently Used Defined Terms. As used in this Agreement, the following
terms have the following meanings:
(a) "1940 Act" means the Investment Company Act of 1940, as amended.
(b) "Adviser" means __________________, the adviser to each of the Funds
listed in Schedule 1 hereto.
(c) "Affiliate" means, with respect to any Person, any other Person that
is controlled by, controls, or is under common control with such
Person; for purposes hereof, "control" of a Person means (i) ownership
of, or possession of the right to vote, more than 25% of the
outstanding voting equity of that person or (ii) the right to control
the appointment of the board of directors, management or executive
officers of that person.
(d) "Agreement" means this Agreement and any appendices and schedules
attached hereto, in each case as they may be amended from time to
time.
(e) "Authorized Person(s)" means the persons described or listed on
Schedule 2 hereto.
(f) "Conduct Rules" means the Conduct Rules of the Financial Industry
Regulatory Authority ("FINRA").
(g) "Class" and "Classes" have the meaning set forth in the preamble to
this Agreement.
(h) "Client" has the meaning set forth in the preamble to this Agreement
and includes successors-in-interest; unless the context shall require
otherwise, references to the Client shall include any Funds or Classes
thereof.
(i) "Effective Date" means the date first set forth above.
(j) "Governing Body" means, for any entity, the Person or body of Persons
governing the operations of the entity under its Organic Documents
(for example, if the entity is a corporation, its board of directors).
(k) "Foreside" has the meaning set forth in the preamble to this Agreement
and includes successors-in-interest.
(l) "Fund" and "Funds" have the meaning set forth in the preamble to this
Agreement.
(m) "Instruction" means any oral and written notice or statement directing
action or inaction, including any such notice or statement transmitted
to Foreside (i) in electronic format by machine readable input,
electronic mail, CRT data entry or other similar means, or (ii) in
person or by telephone, telecopy, vocal telegram or similar means.
(n) "Laws" means any statutes, rules and regulations of any governmental
authority and applicable judicial or regulatory interpretations
thereof including without limitation the Conduct Rules of the FINRA.
(o) "FINRA" means the Financial Industry Regulatory Authority
(p) "NSCC" means the National Securities Clearing Corporation.
(q) "Organic Documents" means, for any entity, the documents pursuant to
which the entity was formed as a legal entity, as such documents may
be amended from time to time.
(r) "Parties" means the Client and Foreside.
(s) "Person" means any natural person or incorporated or unincorporated
entity.
(t) "Plan" has the meaning set forth in Section 2.5(a).
(u) "Predecessor Records" has the meaning set forth in Section 2.9(b).
(v) "Prospectus" has the meaning set forth in Section 2.4(a).
(w) "Registration Statement" means a registration statement filed under
the Securities with respect to the Shares, as amended from time to
time.
(x) "SEC" means the United States Securities and Exchange Commission and
any successor governmental authority.
(y) "Securities Act" means the Securities Act of 1933, as amended.
(z) "Servicing Agent" has the meaning in Section 2.3.
(aa) "Service Plan" has the meaning set forth in Section 2.5(a).
(bb) "Services" means the services provided by Foreside to the Client set
forth in Section 2.4.
(cc) "Services Commencement Date" means, with respect to any Fund or Class
thereof, (i) if the registration statement of the Fund or Class is
effective as of the Effective Date, then such Effective Date; (ii), if
such registration statement is not effective as of the Effective Date,
then the date such registration statement is declared effective; or
(iii) such other date as may be agreed in writing by the Parties.
(dd) "Shareholder" means any Person that holds Shares of record.
(ee) "Shares" has the meaning set forth in the preamble to this Agreement.
(ff) "State" means any of the various states and territories of the United
States.
Other capitalized terms used but not defined in this Section 1.1 shall have the
meanings set forth in this Agreement.
1.2 Appointment. The Client hereby appoints Foreside to act as distributor for
the period and on the terms set forth in this Agreement, and Foreside hereby
accepts such appointment and in connection with such appointment agrees to
provide the Services on the terms and conditions set forth in this Agreement,
subject to applicable Laws, Organic Documents and the current Registration
Statement of the Client.
SECTION 2. OFFERING AND REDEMPTION OF SHARES; FORESIDE'S DUTIES; OTHER RELATED
TERMS AND CONDITIONS
2.1 Offering of Shares.
(a) Foreside shall act as the Client's agent to offer, and to solicit
offers to subscribe to, unsold Shares of the Funds as shall then be
effectively registered under the Securities Act. Foreside will
promptly forward all orders and subscriptions to the Client, or its
designated agent. The price at which Foreside shall offer the Shares
shall be the net asset value per Share, determined as set forth in
Section 2.1(b) hereof. The Client reserves the right to sell Shares
directly to investors through subscriptions received by the Client.
(b) The public offering price of the Shares of a Fund (i.e., the price per
Share at which Foreside or Servicing Agents may offer or sell Shares
to the public or to those persons eligible to invest in Shares as
described in the applicable Prospectus) shall be the public offering
price determined in accordance with the then-currently effective
Prospectus of the Fund or Class thereof under the Securities Act
relating to such Shares. The Client will advise Foreside of the net
asset value per Share at each time as the net asset value per Share
shall have been determined by the Client and at such other times as
Foreside may reasonably request.
(c) The net asset value per Share of each Fund or Class thereof shall be
determined by the Client, or its designated agent, in accordance with
and at the times indicated in the applicable Prospectus in accordance
with the method set forth in the Prospectus and guidelines established
by the Client's Governing Body.
(d) The Client reserves the right to suspend the offering of Shares of a
Fund or of any Class thereof at any time in the absolute discretion of
their Governing Body, and upon notice of such suspension Foreside
shall cease to offer Shares of the Funds or Classes thereof specified
in the notice.
(e) The Client, or any agent of the Client designated in writing to
Foreside by the Client, shall be promptly advised by Foreside or
Servicing Agents of all purchase orders for Shares received by
Foreside or such Servicing Agents, and all such subscriptions for
Shares obtained by Foreside as agent shall be directed to the Client
or their agent for acceptance and shall not be binding until accepted
by the Client. The Client, in its discretion, may refuse to accept any
order for the purchase of shares that Foreside or Servicing Agents may
tender to it. Foreside acknowledges that the Client seeks to avoid so
called "market timers" and may reject or refuse to accept or confirm
orders or subscriptions from any persons who exhibit or who may
exhibit market timing behavior. The Client or their designated agent
will confirm orders and subscriptions upon their receipt, will make
appropriate book entries and, upon receipt by the Client or its
designated agent of payment thereof, will issue such Shares in
uncertificated form pursuant to the instructions of Foreside.
(f) Neither Foreside, any Servicing Agent nor any other person is
authorized by the Client to give any information or to make any
representations other than as is contained in a Fund's Prospectus or
any advertising materials or sales literature specifically approved in
writing by the Client or its agents.
2.2 Repurchase and Redemption of Shares.
(a) Any of the outstanding Shares of a Fund or Class thereof may be
tendered for redemption at any time, and the Client agrees to redeem
or repurchase the Shares so tendered in accordance with their
obligations as set forth in the Organic Documents and the Prospectus
relating to the Shares. The price to be paid to redeem or repurchase
the Shares of a Fund or Class thereof shall be equal to the net asset
value calculated in accordance with the provisions of Section 2.1(b)
hereof less any redemption fees or other applicable fees or expenses
as set forth in the then-current Prospectus.
(b) The Client or its designated agent shall pay (i) the total amount of
the redemption price consisting of the redemption price after
applicable redemption or other fees and (ii) except as may be
otherwise required by the Conduct Rules and any interpretations
thereof, in accordance with Foreside's instructions, on or before the
seventh day (or such other earlier business day as is customary in the
investment company industry) subsequent to the Client or its agent
having received the notice of redemption in proper form.
(c) Redemption of Shares or payment therefor may be suspended at times
when the New York Stock Exchange is closed for any reason other than
its customary weekend or holiday closings, when trading thereon is
restricted, when an emergency exists as a result of which disposal by
the Client of securities owned by a Fund is not reasonably practicable
or it is not reasonably practicable for the Client fairly to determine
the value of a Fund's net assets, or during any other period when the
SEC so requires or permits.
2.3 Servicing Agents.
At the request of the Client, Foreside shall enter into Servicing Agent
agreements with securities dealers, depository institutions and other financial
intermediaries for the purpose of facilitating the offer, sale and redemption of
Shares by Shareholders; provided, that the Client shall pre-approve the forms of
agreements with Servicing Agents and shall have the right to approve any
compensation set forth therein or any material changes from such pre-approved
forms. Foreside may enter into dealer agreements and other selling agreements
with broker-dealers and other intermediaries; provided, however, that Foreside
shall have no obligation to make any payments to any third parties, whether as
finder's fees, compensation or otherwise, unless (i) Foreside has received a
corresponding payment from the applicable Fund's Plan or Service Plan, the
Fund's investment adviser (the "Adviser") or from another source as may be
permitted by applicable law, and (ii) such corresponding payment has been
approved by the Client's Board of Trustees (the "Board"). Shares of each Fund or
Class thereof shall be offered and resold by Servicing Agents only at the public
offering prices and under the terms set forth in the Prospectus relating to the
Shares. Within the United States, Foreside shall enter into Servicing Agent
agreements only with members in good standing of the FINRA or financial
intermediaries otherwise exempt from registration as a broker-dealer for
receiving transaction based compensation, such as banks and trust companies.
2.4 Foreside's Services and Duties; Exclusivity.
(a) Foreside shall use reasonable efforts to solicit orders to purchase
Shares of the Funds upon the terms and conditions contained herein and
in the then current Prospectus. Foreside shall devote reasonable time
and effort to effect sales of Shares but shall not be obligated to
sell any specific number of Shares.
(b) Foreside shall maintain its registration as a broker-dealer in all
States. Foreside will notify the Client immediately if it ceases
maintaining registration in advance of any required filing or renewal
date.
(c) In performing its services under this Agreement, Foreside shall
conform in all respects with the requirements of all Federal and State
Laws relating to the offer and sale of the Shares.
(d) Foreside shall, at the request of the Client (i) attempt to maintain
active agreements with any Servicing Agents related to the servicing
of the Funds that, prior to the Effective Date of this Agreement,
acted in similar capacities for a Fund, and (ii) assist the Client in
obtaining additional agreements with broker-dealers and other
financial intermediaries.
(e) Insofar as it is required to ensure compliance with the Conduct Rules,
Foreside shall track and maintain appropriate information with respect
to payments made by each Fund under Rule 12b-1 under the 1940 Act and
other payments such as marketplace distribution, maintenance and
service fees, and shall make quarterly reports to the Board regarding
such payments.
(f) Foreside shall adopt and follow procedures for the confirmation of
sales to investors and selected dealers or selected agents, the
collection of amounts payable by investors and selected dealers or
selected agents on such sales, and the cancellation of unsettled
transactions, as may be necessary to comply with the requirements of
the 1934 Act and the FINRA.
(g) Foreside shall maintain membership with the NSCC and any other similar
successor organization to sponsor a participant number for the Funds
so as to enable the Shares to be traded through FundSERV. Foreside is
not responsible for any operational matters associated with FundSERV
or Networking transactions.
(h) Foreside shall review, and provide to the Client a summary of its
review of all advertising and sales literature for the Client no later
than three business days after any routine advertising or sales
literature is proposed and received by Foreside' compliance department
(five business days after any extraordinary advertising or sales
literature is proposed and received), and file such material with the
FINRA or appropriate regulatory body, as required.
(i) Nothing contained herein shall be construed to require Foreside to
perform any service that could cause Foreside to be deemed an
investment adviser for purposes of the 1940 Act or the Investment
Advisers Act of 1940, as amended.
(j) Neither Foreside, nor any other person acting on behalf of Foreside is
authorized to give any information or to make any representations
other than as is contained in a Fund's Prospectus, statement of
additional information, or any advertising materials or sales
literature specifically approve in writing by the Client or its
agents.
(k) Except as specifically set forth in this Agreement to the contrary,
Foreside assumes no responsibility for compliance by the Client with
any Laws applicable to the Client with which Foreside has no role in
achieving compliance; and, notwithstanding any other provision of this
Agreement to the contrary, Foreside assumes no responsibility under
this Agreement to Client or any other Person for compliance by the
Client or Foreside with the Laws of any jurisdiction other than those
of the United States.
(l) Nothing contained in this Agreement shall require Foreside to perform
any functions or duties on any weekend day or on any other day on
which the Client does not accept subscriptions and redemptions of its
Shares (a "Business Day"). Functions or duties normally scheduled to
be performed on any day that is not a Business Day shall be performed
on, and as of, the next Business Day, unless otherwise required by
applicable Law.
(m) Foreside shall be the exclusive representative of the Client to act as
distributor of the Shares of the Funds and Classes, except that the
rights given under this Agreement to Foreside shall not apply to: (i)
Shares issued in connection with the merger, consolidation or
reorganization of any other investment company or series or class
thereof with a Fund or Class thereof; (ii) a Fund's acquisition by
purchase or otherwise of all or substantially all of the assets or
stock of any other investment company or series or class thereof;
(iii) the reinvestment in Shares by a Fund's shareholders of dividends
or other distributions; or (iv) any other offering by the Client of
securities to their shareholders.
2.5 Certain Documents; Changes in Law.
(a) Contemporaneous with the Effective Date, the Client shall deliver to
Foreside copies of the following documents: (i) the Client's Organic
Documents; (ii) the Prospectuses for the Funds and Classes thereof
(each, a "Prospectus"); (iii) each current plan of distribution or
similar document adopted by the Client under Rule 12b-1 under the 1940
Act ("Plan") and each current shareholder service plan or similar
document adopted by the Client ("Service Plan") and (iv) any relevant
policies and procedures adopted by the Client pursuant to Rule 38a-1
of the 1940 Act that are applicable to the services provided by
Foreside. The Client shall also deliver to Foreside: (x) a copy of the
resolution of the Board of Trustees of the Client (the "Board")
appointing Foreside and authorizing the execution and delivery of this
Agreement; and (y) any other documents, materials or information that
Foreside shall reasonably request to enable it to perform its duties
pursuant to this Agreement.
(b) Client shall deliver to Foreside as soon as is reasonably practical
any and all amendments to the documents required to be delivered under
Section 2.5(a).
(c) In the event there is a change in Law related to or affecting the
Services, Foreside shall begin performing new service(s) as soon as
such change is effective or enforceable. If such new service(s) are
materially different or more burdensome than the current level of
service(s), the parties shall agree to mutually acceptable policies
and procedures for such new service(s).
2.6 Reliance on Instructions, Documents and Advice.
(a) With respect to the subject matter of this Agreement, Foreside may
rely on (i) with respect to any matter, advice or Instruction that it
receives and that it reasonably believes in good faith was transmitted
by the Client 's Governing Body or an Authorized Person; or (ii) with
respect to any factual matter, any signature, Instruction, request,
letter of transmittal, certificate, opinion of counsel, statement,
instrument, report, notice, consent, order, or other document of or
presented by any Person (including any authorized representative(s) of
any predecessor service providers to the Client ).
(b) Notwithstanding any other provisions of this Agreement to the
contrary, Foreside shall have no duty or obligation to inquire into
(i) the authenticity of any statement, oral or written Instruction,
resolution, signature, request, letter of transmittal, certificate,
opinion of counsel, instrument, report, notice, consent, order, or any
other document or instrument that Foreside reasonably believes in good
faith to be genuine; or (ii) the authority or lack thereof of any
Person to represent or act as an agent for any other Person, provided
that Foreside reasonably believes in good faith that such authority
exists, and, provided, further, that with respect to Instructions of
the Client , Foreside may only rely on Instructions of the Client '
Governing Body or Authorized Persons.
(c) Foreside may assume that any Instructions are not in any way
inconsistent with the Organizational Documents, the Prospectus, or any
proceeding or resolution of the Client's Governing Body or the
Shareholders of the Client , unless and until Foreside receives
written notice to the contrary from the Client's Governing Body or an
Authorized Person, and provided that Foreside makes reasonable inquiry
into any instructions if Foreside has doubts regarding the intention
of any instructions.
(d) Absent specific written notice to the contrary, Foreside may assume
that Authorized Persons are authorized to deliver instructions
relating to all or any matter under this Agreement. The Client's
Governing Body may at any time (i) change the list of Authorized
Persons or (ii) limit an Authorized Person's authority upon delivery
of written notice from a representative thereof to Foreside.
(e) About any matter related to the Client or the Services, Foreside may
rely on the advice of the Client or Client's outside counsel, or the
advice of counsel to Foreside; provided Foreside notifies Client in
advance of its intentions. Any costs related to such advice or
Instructions shall be borne by the Client, except that Foreside shall
be responsible for costs related to advice from in-house counsel to
Foreside or any affiliate of Foreside. In the event of any conflict
between advice or Instructions Foreside receives from (i) any
Authorized Person and (ii) advice from counsel, Foreside may rely on
advice from counsel.
(f) Nothing in this Section 2.6 shall be construed as imposing on Foreside
any obligation to seek advice or Instructions, or, subject to Section
3.1(b), to act in accordance with such advice or Instructions if and
when received.
2.7 Other Activities.
Foreside may provide services similar to those provided under this Agreement for
any other Person on such terms as may be arranged with such Person, and Foreside
shall not be required to disclose to the Client any fact or thing that may come
to the knowledge of Foreside in the course of so doing.
2.8 Cooperation with Independent Auditors and Counsel. Foreside shall cooperate
with the independent auditor(s) and attorneys of the Client and shall take
reasonable action to make all necessary information related to the Services
available to such auditors and attorneys for the performance of their duties.
2.9 Certain Responsibilities of the Client. The Client agrees to:
(a) Comply in all material respects with all applicable provisions of the
1940 Act, the Securities Act, Conduct Rules and all other Laws
governing the issuance and sale of Shares or otherwise applicable to
the Client .
(b) Prior to the Services Commencement Date, deliver or cause to be
delivered to Foreside all books, records and other documents relating
to the Client's prior operations and service providers, if any, that,
in Foreside's reasonable opinion, are necessary for Foreside properly
to provide the Services (collectively "Predecessor Records").
(c) Provide, and cause each other agent or service provider to the Client
to provide, to Foreside all such information (and in such reasonable
medium) that Foreside may reasonably request in connection with the
Services and this Agreement.
(d) Upon request, deliver to Foreside in advance of filing thereof with
the SEC any relevant portions of the Registration Statement in order
to permit Foreside and its agents to review and comment upon, at
Foreside's discretion, those portions thereof that describe Foreside
and Foreside's duties and obligations under this Agreement, including
the indemnity provisions hereof, and the Client shall not make any
reference to Foreside and such duties, obligations and indemnities in
any Registration Statement without Foreside's consent, which consent
shall not be unreasonably withheld or delayed.
(e) Upon request, furnish to Foreside copies of all financial statements
and other documents to be delivered to shareholders or investors
within a reasonable period of time prior to such delivery and shall
furnish Foreside copies of all other financial statements, documents
and other papers or information which Foreside may reasonably request
for use in connection with the distribution of Shares. The Client
shall make available to Foreside the number of copies of the Funds'
Prospectuses as Foreside shall reasonably request.
(f) The Client shall take, from time to time, subject to the approval of
the Board and any required approval of the shareholders of the Client,
all action necessary to fix the number of authorized Shares (if such
number is not limited) and to register the Shares under the Securities
Act, to the end that there will be available for sale the number of
Shares as reasonably may be expected to be sold pursuant to this
Agreement.
(g) The Client agrees to inform the Foreside from time to time of the
states in which the Fund or its administrator has registered or
otherwise qualified shares for sale, and the Client agrees at its own
expense to execute any and all documents and to furnish any and all
information and otherwise to take all actions that may be reasonably
necessary in connection with the qualification of the Shares for sale
in such states as the Foreside may designate; provided that Foreside
shall not be required to register as a broker-dealer or file a consent
to service of process in any State and neither the Client nor any Fund
or Class thereof shall be required to qualify as a foreign
corporation, Client or association in any State. Any registration or
qualification may be withheld, terminated or withdrawn by the Client
at any time in its discretion. Foreside shall furnish such information
and other material relating to its affairs and activities as may be
required by the Client in connection with such registration or
qualification.
(h) Cause the transfer agent for each Fund and Class, where necessary or
appropriate, to provide Foreside with any information that may be
necessary for Foreside to perform its duties under this Agreement.
(i) Advise Foreside as soon as reasonably possible: (i) of the issuance by
the SEC of any stop order suspending the effectiveness of the Client's
Registration Statement or any Prospectus or the initiation of any
proceedings for that purpose; (ii) of any request by the SEC for
amendments to the registration statement or Prospectus then in effect
or for additional information; (iii) of the happening of any material
event which makes untrue any statement made in the Client's
Registration Statement or which requires the making of a change in
either thereof in order to make the statements therein not misleading.
SECTION 3. RECORDKEEPING; PROPRIETARY INFORMATION; CONFIDENTIALITY
3.1 Predecessor Records; Ownership; Inspection; Successors.
(a) Predecessor Records received by Foreside pursuant to Section 2.9(b)
shall be the property of the Client. The Client and the Client's
authorized representatives shall have access to such Predecessor
Records at all times during Foreside's normal business hours. Upon the
reasonable advance request of the Client or such authorized
representatives, copies of any such Predecessor Records shall be
provided by Foreside, at the Client's expense, to the Client or its
authorized representatives.
(b) If Foreside receives a request or demand from a third party to inspect
any Predecessor Records, Foreside will endeavor to notify the Client
and to secure Instructions from the Client or an Authorized Person
about such inspection. Foreside shall abide by such Instructions for
granting or denying the inspection; provided, that Foreside may grant
the inspection without Instructions or in contravention of specific
Instructions if Foreside is advised by counsel to Foreside or the
Client that failure to do so is substantially likely to result in
liability to Foreside; and provided, further, that in such event,
Foreside shall endeavor promptly to advise the Client of such contrary
advice, to the extent practicable in advance of any actual inspection.
(c) Upon termination of this Agreement, Foreside shall, at the expense and
direction of the Client, transfer to Client or any successor service
provider all Predecessor Records in the electronic or other medium in
which such material is then maintained by Foreside.
3.2 Proprietary Information of Foreside. The Client acknowledges that the
databases, computer programs, screen formats, report formats, interactive design
techniques, and documentation manuals maintained by Foreside on databases under
the control and ownership of Foreside or a third party constitute copyrighted,
trade secret, or other proprietary information (collectively, "Proprietary
Information") of substantial importance to Foreside or the third party. The
Client agrees to treat all Proprietary Information as proprietary to Foreside
and further agrees that it shall maintain as confidential any Proprietary
Information, except as may be provided under this Agreement, and that breach by
the Client of this confidentiality obligation would cause irreparable injury to
Foreside.
3.3 Confidentiality.
(a) Each Party (for purposes of this Section 3.3, a "Receiving Party")
agrees to keep confidential all information disclosed by the other
Party (for purposes of this Section 3.3, a "Disclosing Party"),
including, without limitation all forms and types of financial,
business, marketing, operations, technical, economic and engineering
information of the Disclosing Party, whether tangible or intangible.
(b) Notwithstanding any provision of this Agreement to the contrary, the
Parties agree that the following information shall not be deemed
confidential information: (i) information that was known to the
receiving Party before receipt thereof from or on behalf of the
Disclosing Party; (ii) information that is disclosed to the Receiving
Party by a third person who has a right to make such disclosure
without any obligation of confidentiality to the Party seeking to
enforce its rights under this Section 3; (iii) information that is or
becomes generally known in the trade without violation of this
Agreement by the Receiving Party; or (iv) information that is
independently developed by the Receiving Party or its employees or
affiliates without reference to the Disclosing Party's information.
(c) Notwithstanding any provision of this Agreement to the contrary,
Foreside may: (i) provide information to Foreside's counsel and to
Persons engaged by Foreside or the Client to provide services with
respect to the Client; (ii) provide information consistent with the
Procedures or with operating procedures that are customary with
respect to the Services in the industry; (iii) identify the Client as
a client of Foreside for Foreside's sales and marketing purposes; and
(iv) provide information as approved by an Authorized Person,
provided, that (A) such approval shall not be unreasonably withheld or
delayed, and (B) Foreside may release information without approval of
the Client if Foreside is advised by counsel to Foreside or the Client
that failure to do so will result in liability to Foreside; and
provided, further, that, in such event Foreside shall endeavor
promptly to advise the Client of such advice, to the extent
practicable in advance of any actual release of information.
(d) Foreside acknowledges that certain Shareholder information made
available by the Client to Foreside or otherwise maintained by
Foreside under this Agreement may be deemed nonpublic personal
information under the Xxxxx-Xxxxx-Xxxxxx Act and other applicable
privacy Laws (collectively, "Privacy Laws"). Foreside agrees (i) not
to disclose or use such information except as required to carry out
its duties under the Agreement or as otherwise permitted by law in the
ordinary course of business; (ii) to limit access to such information
to authorized representatives of Foreside and the Client ; (iii) to
establish and maintain reasonable physical, electronic and procedural
safeguards to protect such information; and (iv) to cooperate with the
Client and provide reasonable assistance in ensuring compliance with
such Privacy Laws to the extent applicable to either or both of the
Parties.
SECTION 4. RESPONSIBILITY OF FORESIDE; INDEMNIFICATION; OTHER LIABILITY-RELATED
MATTERS
4.1. Responsibility of Foreside; Limitations.
(a) Foreside shall be under no duty to take any action under this
Agreement except as specifically set forth in this Agreement or as may
be specifically agreed to by Foreside and the Client in a written
amendment to this Agreement.
(b) In performing the Services, Foreside (i) shall act in good faith and
shall be obligated to exercise care and diligence; and (ii) may,
without limiting the generality of any other provision of this
Agreement, rely on Instructions, advice and information pursuant to
Section 2.6.
(c) Notwithstanding anything in this Agreement to the contrary, Foreside
shall be liable to the Client only for any damages arising out of
Foreside's failure to perform its duties under this Agreement to the
extent such damages were caused solely and directly by Foreside's
willful misfeasance, bad faith, gross negligence or reckless disregard
of such duties.
(d) Foreside shall not be liable for the delays or errors of Persons that
provide services to the Client or Foreside (other than employees of
Foreside) or of other Persons, including the failure by any such
Person to provide information to Foreside when they have a duty to do
so (irrespective of whether that duty is owed specifically to Foreside
or a third party).
4.2 Indemnification; Notification of Claims.
(a) Notwithstanding anything in this Agreement to the contrary, Foreside
shall not be responsible for, and the Client shall on behalf of each
applicable Fund or Class thereof, indemnify and hold harmless
Foreside, its employees, directors, officers and managers and any
person who controls Foreside within the meaning of section 15 of the
Securities Act or section 20 of the Securities Exchange Act of 1934,
as amended, (for purposes of this Section 4.2(a), "Foreside
Indemnitees") from and against, any and all losses, damages, costs,
charges, reasonable counsel fees, payments, liabilities and other
expenses of every nature and character (including, but not limited to,
direct and indirect reasonable reprocessing costs) arising out of or
attributable to all and any of the following (for purposes of this
Section 4.2(a), a "Foreside Claim"):
(i) any material action (or omission to act) of Foreside or its
agents taken in connection with this Agreement; provided, that
such action (or omission to act) is taken in good faith and
without willful misfeasance, gross negligence or reckless
disregard by Foreside of its duties and obligations under this
Agreement;
(ii) any untrue statement of a material fact contained in the
Registration Statement or arising out of or based upon any
alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading, unless such statement or omission was made in
reliance upon, and in conformity with, information furnished to
the Client in connection with the preparation of the Registration
Statement or exhibits to the Registration Statement by or on
behalf of Foreside;
(iii) any untrue statement, or alleged untrue statement, of a material
fact in any Client-related advertisement or sales literature, or
any omission, or alleged omission, to state a material fact
required to be stated therein to make the statements therein not
misleading, in either case notwithstanding the exercise of
reasonable care in the preparation or review thereof by Foreside;
(iv) any material breach of the Client's agreements, representations,
warranties, and covenants in Sections 2.9 and 5.2 of this
Agreement; or
(v) the reliance on or use by Foreside or its agents or
subcontractors of information, records, documents or services
which have been prepared, maintained or performed by the Client
or any agent of the Client, including but not limited to any
Predecessor Records provided pursuant to Section 2.9(b).
(b) Foreside will indemnify, defend and hold the Client and its several
officers and members of their Governing Bodies and any person who
controls the Client within the meaning of section 15 of the Securities
Act or section 20 of the Securities Exchange Act of 1934, as amended,
(collectively, the "Client Indemnitees" and, with the Foreside
Indemnitees, an "Indemnitee"), free and harmless from and against any
and all claims, demands, actions, suits, judgments, liabilities,
losses, damages, costs, charges, reasonable counsel fees and other
expenses of every nature and character (including the cost of
investigating or defending such claims, demands, actions, suits or
liabilities and any reasonable counsel fees incurred in connection
therewith), but only to the extent that such claims, demands, actions,
suits, judgments, liabilities, losses, damages, costs, charges,
reasonable counsel fees and other expenses result from, arise out of
or are based upon all and any of the following (for purposes of this
Section 4.2(c), a "Client Claim" and, with a Foreside Claim, a
"Claim"):
(i) any material action (or omission to act) of Foreside or its
agents taken in connection with this Agreement, provided that
such action (or omission to act) is not taken in good faith and
with willful misfeasance, gross negligence or reckless disregard
by Foreside of its duties and obligations under this Agreement.
(ii) any untrue statement of a material fact contained in the
Registration Statement or Client-related advertising or sales
literature or any alleged omission of a material fact required to
be stated or necessary to make the statements therein not
misleading, if such statement or omission was made in reliance
upon, and in conformity with, information furnished to the Client
in writing in connection with the preparation of the Registration
Statement or Client-related advertising or sales literature
(other than in respect of Fund-related advertisements or sales
literature that fail to comply with applicable laws despite the
Distributor's exercise of reasonable care in the preparation and
review thereof) by or on behalf of Foreside; or
(iii) any material breach of Foreside's agreements, representations,
warranties and covenants set forth in Section 2.4 and 5.1 hereof.
(d) The Client or Foreside (for purpose of this Section 4.2(d), an
"Indemnifying Party") may assume the defense of any suit brought to
enforce any Foreside Claim or Client Claim, respectively, and may
retain counsel chosen by the Indemnifying Party and approved by the
other Party, which approval shall not be unreasonably withheld or
delayed. The Indemnifying Party shall advise the other Party that it
will assume the defense of the suit and retain counsel within ten (10)
days of receipt of the notice of the claim. If the Indemnifying Party
assumes the defense of any such suit and retains counsel, the other
Party shall bear the fees and expenses of any additional counsel that
they retain. If the Indemnifying Party does not assume the defense of
any such suit, or if other Party does not approve of counsel chosen by
the Indemnifying Party, or if the other Party has been advised that it
may have available defenses or claims that are not available to or
conflict with those available to the Indemnifying Party, the
Indemnifying Party will reimburse any Indemnitee named as defendant in
such suit for the reasonable fees and expenses of any counsel that the
Indemnitee retains. An Indemnitee shall not settle or confess any
claim without the prior written consent of the Client, which consent
shall not be unreasonably withheld or delayed.
(e) An Indemnifying Party's obligation to provide indemnification under
this section is conditioned upon the Indemnifying Party receiving
notice of any action brought against an Indemnitee within twenty (20)
days after the summons or other first legal process is served. Such
notice shall refer to the Person or Persons against whom the action is
brought. The failure to provide such notice shall not relieve the
Indemnifying Party of any liability that it may have to any Indemnitee
except to the extent that the ability of the party entitled to such
notice to defend such action has been materially adversely affected by
the failure to provide notice.
(f) The provisions of this section and the parties' representations and
warranties in this Agreement shall remain operative and in full force
and effect regardless of any investigation made by or on behalf of any
Indemnitee and shall survive the sale and redemption of any Shares
made pursuant to subscriptions obtained by Foreside. The
indemnification provisions of this section will inure exclusively to
the benefit of each person that may be an Indemnitee at any time and
their respective successors and assigns (it being intended that such
persons be deemed to be third party beneficiaries under this
Agreement).
4.3 Other Liability-Related Matters. Notwithstanding anything in this Agreement
to the contrary, except as specifically set forth below:
(a) Neither Party shall be liable for losses, 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; public enemy; war; terrorism; riot; fire; flood;
sabotage; epidemics; labor disputes; civil commotion; interruption,
loss or malfunction of utilities, transportation, computer or
communications capabilities; insurrection; or elements of nature;
(b) Neither Party shall be liable for any consequential, special or
indirect losses or damages suffered by the other Party, whether or not
the likelihood of such losses or damages was known by the Party;
(c) No affiliate, director, officer, employee, manager, shareholder,
partner, agent, counsel or consultant of either Party shall be liable
at law or in equity for the obligations of such Party under this
Agreement or for any damages suffered by the other Party related to
this Agreement;
(d) Except as set forth in Section 4.2(f), there are no third party
beneficiaries of this Agreement;
(e) Each Party shall have a duty to mitigate damages for which the other
Party may become responsible;
(f) The assets and liabilities of each Fund are separate and distinct from
the assets and liabilities of each other Fund, and no Fund shall be
liable or shall be charged for any debt, obligation or liability of
any other Fund, whether arising under this Agreement or otherwise; and
in asserting any rights or claims under this Agreement, Foreside shall
look only to the assets and property of the Fund to which Foreside's
rights or claims relate in settlement of such rights or claims; and
(g) Each Party agrees promptly to notify the other party of the
commencement of any litigation or proceeding of which it becomes aware
arising out of or in any way connected with the issuance or sale of
Shares.
SECTION 5. REPRESENTATIONS AND WARRANTIES
5.1 Representations and Warranties of Foreside. Foreside represents and warrants
to the Client that:
(a) It is a limited liability company duly organized and existing and in
good standing under the laws of the State of Delaware and it is duly
qualified to carry on its business in the State of Maine;
(b) It is empowered under applicable Laws and by its Organic Documents to
enter into this Agreement and perform its obligations under this
Agreement;
(c) All requisite limited liability company proceedings have been taken to
authorize it to enter into this Agreement and perform its obligations
under this Agreement;
(d) It has and will continue to have access to the necessary facilities,
equipment, and personnel to perform its duties and obligations under
this Agreement;
(e) This Agreement, when executed and delivered, will constitute a legal,
valid and binding obligation of Foreside, enforceable against Foreside
in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws of general application
affecting the rights and remedies of creditors and secured parties;
(f) The performance by Foreside of its obligations under this Agreement
does not and will not contravene any provision of its Organic
Documents;
(g) It is registered under the 1934 Act with the SEC as a broker-dealer,
it is a member in good standing of the FINRA, it will abide by the
rules and regulations of the FINRA, and it will immediately notify the
Client if any regulatory actions are instituted against it by the SEC
or FINRA or its membership in the FINRA or registration with any State
is terminated or suspended.
5.2 Representations and Warranties of the Client. The Client represents and
warrants to Foreside that:
(a) It is duly organized and existing and in good standing under the laws
of the jurisdiction of its organization;
(b) It is empowered under applicable Laws and by their Organic Documents
to enter into this Agreement and perform its obligations under this
Agreement;
(c) All requisite corporate or similar proceedings have been taken to
authorize it to enter into this Agreement and perform its obligations
under this Agreement.
(d) This Agreement, when executed and delivered, will constitute a legal,
valid and binding obligation of the Client, enforceable against the
Client in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws of general
application affecting the rights and remedies of creditors and secured
parties;
(e) With respect to all Shares from time to time being offered for sale to
the public, a Registration Statement is currently effective or will be
effective at the time of sale, and will remain effective, and all
appropriate Federal and State securities law filings have been made
and will continue to be made;
(f) The Registration Statement has been, and any amendment thereto will
be, as the case may be, prepared in conformity with the requirements
of the Securities Act and the 1940 Act and the rules and regulations
thereunder, and all Client-related advertisement or sales literature
shall be prepared in conformity with requirements of applicable laws
and regulations. The Registration Statement and advertisement and
sales literature shall contain all statements required to be stated
therein in conformity with said Acts, laws and regulations and the
rules and regulations of the SEC thereunder or other applicable
regulatory authority, and all material statements of fact contained or
to be contained in the Registration Statement and advertisement and
sales literature are or will be true and correct in all material
respects at the time indicated or on the effective date, as the case
may be; and the Registration Statement and advertisement and sales
literature, when it shall become effective or be authorized for use,
will not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading to a purchaser of Shares;
and
(g) It shall not file any amendment to the Registration Statement or
Prospectuses without giving Foreside reasonable advance notice
thereof; provided, however, that nothing contained in this Agreement
shall in any way limit the Client's right to file at any time such
amendments to the Registration Statement or Prospectuses, of whatever
character, as the Client may deem advisable, such right being in all
respects absolute and unconditional.
SECTION 6. COMPENSATION AND EXPENSES
6.1 Compensation.
[(a) In consideration of Foreside's services in connection with the
distribution of Shares of each Fund and Class thereof, Foreside shall
receive: (i) any applicable sales charge assessed upon investors in
connection with the purchase of Shares; (ii) from the Client, any
applicable contingent deferred sales charge ("CDSC") assessed upon
investors in connection with the redemption of Shares; (iii) from the
Client, the distribution and / or service fees with respect to the
Shares of those Classes as designated in Schedule 1 for which a Plan
is effective (the "Distribution Fee"); and (iv) from the Client, the
shareholder service fees with respect to the Shares of those Classes
as designated in Schedule 1 for which a Service Plan is effective (the
"Shareholder Service Fee"). The Distribution Fee and Shareholder
Service Fee shall be earned and paid pursuant to the Agreement(s) of
Distribution Plan for [Class A and Class C Shares].
(b) In order for Foreside to perform its duties hereunder, the Client
shall cause its transfer agent (the "Transfer Agent") (i) to withhold
from redemption proceeds payable to holders of Shares of the Funds and
the Classes thereof, all CDSCs properly payable by the shareholders in
accordance with the terms of the applicable Prospectus and pay such
amounts to Foreside as promptly as practicable, (ii) to pay to
Foreside all initial sales charges (net of dealer reallowances) and,
(iii) to report to Foreside any information that may be necessary for
Foreside to perform its duties under this Agreement.]
(c) Other than stated in Section 6(a) and 6(b) above, Foreside shall be
entitled to no compensation or reimbursement of expenses from Client
for the services provided by Foreside pursuant to this Agreement.
Foreside may receive compensation from the Client or the Client's
Adviser related to its services hereunder or for additional services
as may be agreed to between the Client, Adviser and Foreside.
6.2 Expenses.
(a) The Client shall bear the cost and expenses: (i) of the registration
of the Shares for sale under the Securities Act; and (ii) of the
registration or qualification of the Shares for sale under the
securities laws of the various States;
(b) Foreside shall pay all expenses relating to Foreside's broker-dealer
qualification. Foreside shall also pay all expenses incurred in
providing office space, equipment, and personnel as may be necessary
or convenient to provide the Services.
6.3 Other Compensation. Notwithstanding anything in this Agreement to the
contrary, Foreside and its affiliates may receive compensation or reimbursement
from the Client and the Adviser with respect to any services not included under
this Agreement.
SECTION 7. EFFECTIVENESS, DURATION, TERMINATION; ADDITIONAL FUNDS AND CLASSES
7.1 Effectiveness. This Agreement shall become effective on the Effective Date,
and shall become effective with respect to each Fund or Class thereof on the
Services Commencement Date with respect to such Fund or Class.
7.2 Duration. This Agreement shall continue in effect with respect to Client for
two years following the Effective Date and thereafter shall continue in effect
with respect to each Fund until terminated; provided, that continuance is
specifically approved at least annually pursuant to Section 15 of the 1940 Act
and otherwise as required pursuant to any Plan.
7.3 Termination.
(a) This Agreement may be terminated at any time with respect to a Fund,
without the payment of any penalty, (i) by the Client's Governing Body
or by a vote of a majority of the outstanding voting securities of the
Fund or, with respect to each Class of a Fund for which there is an
effective Plan, a majority of members of the Client's Governing Body
who do not have any direct or indirect financial interest in any such
Plan or in any agreements related to the Plan, on thirty (30) days'
written notice to Foreside or (ii) by Foreside on thirty (30) days'
written notice to the Client.
(b) This Agreement shall automatically terminate upon its assignment or
upon the termination of Foreside's membership in the FINRA.
7.4 Survival. The provisions of Sections 2.6, 2.8, 3.1(c), 3.2, 3.3, 4, 6.1,
6.2, 7 and 8 shall survive any termination of this Agreement.
7.5 Additional Funds and Classes.
(a) In the event that the Client requests Foreside to provide services
with respect to one or more additional funds and/or classes of the
Client after the Effective Date, such funds and/or classes shall
become Funds and/or Classes under this Agreement for all purposes
hereof upon the execution of a joinder to this Agreement by the Client
and Foreside.
(b) In the event that after the Effective Date the Client winds up one or
more Funds and/or Classes or otherwise terminate this Agreement with
respect to a Fund and its Classes, such Fund or Class shall from the
date of such winding up or termination no longer be deemed a Fund or
Class under this Agreement, provided, that the Client shall remain
obligated pursuant to Section 6 to make any payments for obligations
incurred through the date of termination respecting such Fund and its
Classes, including any obligations that specifically survive the
termination of this Agreement with respect to such Fund or Class.
SECTION 8. MISCELLANEOUS
8.1 Amendments. No provisions of this Agreement may be amended or modified in
any manner except by a written agreement properly authorized and executed by the
Parties; provided, that (i) the Client may amend Schedule 2 as permitted by
Section 2.6(d); and (ii) the Client and/or Foreside may, as a result of the
addition or termination of a Fund or Class hereunder as contemplated by Section
7.5, amend Schedule 1 as permitted by Section 7.5.
8.2 Governing of Law. This Agreement shall be construed and the provisions
hereof interpreted under and in accordance with the Laws of the State of
Delaware, without giving effect to the conflicts of laws, principles and rules
thereof.
8.3 Entire Agreement. This Agreement constitutes the entire agreement between
the Parties hereto and supersedes any prior agreement with respect to the
subject matter hereof, whether oral or written.
8.4 Counterparts. This Agreement may be executed by the Parties hereto in any
number of counterparts, and all of the counterparts taken together shall be
deemed to constitute one and the same instrument.
8.5 Severability. If any part, term or provision of this Agreement is held to be
illegal, in conflict with any law or otherwise invalid, the remaining portion or
portions shall be considered severable and unaffected, and the rights and
obligations of the Parties shall be construed and enforced as if the Agreement
did not contain the particular part, term or provision held to be illegal or
invalid.
8.6 Headings. Section and paragraph headings in this Agreement are included for
convenience only and are not to be used to construe or interpret this Agreement.
8.7 Notices and Other Communications; Electronic Records.
(a) Any notice required or permitted to be given hereunder by either party
to the other shall be deemed sufficiently given if in writing and
personally delivered or sent by, facsimile or registered, certified or
overnight mail, postage prepaid, addressed by the party giving such
notice to the other party at the address furnished below unless and
until changed by Foreside or Client, as the case may be. Notice shall
be given to each party at the following addresses:
If to Foreside:
Foreside Fund Services, LLC
Two Portland Square, first floor
Xxxxxxxx, Xxxxx 00000
Attn: Corporate Counsel
Fax: (000) 000-0000
If to Client :
(b) This Agreement and electronic signatures and records delivered and
maintained under the Agreement shall be effective to the fullest
extent permitted by Law, provided that references in this Agreement to
written approval or approval in writing of either Party shall be
restricted to a writing executed by a then-current executive officer
of such Party. Each Party agrees to maintain a copy of this Agreement
and any amendments to this Agreement for its records.
8.8 Interpleader. In the event of a dispute about any funds of the Client held
by Foreside from time to time under this Agreement, Foreside or its agents may
commence an action in interpleader and pay the disputed funds into a court of
competent jurisdiction, and the Client shall reimburse Foreside for its
reasonable costs and expenses related to any such action in interpleader.
8.9 Certain Terms. The terms "vote of a majority of the outstanding voting
securities," "interested person," "affiliated person" and "assignment" shall
have the meanings ascribed thereto in the 1940 Act.
SECTION 9. ANTI-MONEY LAUNDERING COMPLIANCE
Foreside and Client hereby represent and warrant that each has implemented and
enforces an anti-money laundering program ("AMLP") that complies with laws,
regulations and regulatory guidance applicable to their business, and includes,
at a minimum:
(A) written policies, procedures, and controls to detect and prevent
money laundering, as appropriate;
(B) a designated compliance officer with sufficient authority to
oversee the AML Program;
(C) an ongoing training program for appropriate persons; and
(D) scheduled independent testing of the AML Program.
9.2 Reports. Foreside agrees to provide periodic reports concerning its
compliance with Foreside's AMLP at such times as may be reasonably requested by
the Client's Board of Trustees or AML Compliance Officer.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed in their names and on their behalf by and through their duly authorized
officers or representatives, as of the day and year first above written.
ABERDEEN FUNDS
By: ______________________________
Xxxxxxx X. Xxxxxxxx
President
FORESIDE FUND SERVICES, LLC
By: _____________________________
Xxxxxxx X. Xxxxxx
Vice President
List of Schedules and Appendices that are part of this Agreement:
Schedule 1 Funds and Classes of the Client
Schedule 2 Authorized Persons
[FUND]
Schedule 1
Funds and Classes of the Client
As of the Effective Date:
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Funds Classes
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[FUND]
Schedule 2
Authorized Persons
1. Authorized Persons:
In addition to the officers (including assistant officers) of the Client, the
following persons are authorized to give Instructions to Foreside with respect
to this Agreement:
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Name Title
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2. Change in Authorized Persons
Any change in Authorized Persons shall only be made in accordance with Section
2.6(d) of the Agreement.
