DISTRIBUTION AGREEMENT
THIS AGREEMENT is made as of this ___ day of _______, 2003, by and
between _______ Funds, a ____________ business trust (the "Trust"),
and UMB Distribution Services, LLC, a Wisconsin limited liability
company (the "Distributor").
WHEREAS, the Trust is an open-end investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act")
and is authorized to issue shares of beneficial interests in separate
series with each such series representing interests in a separate
portfolio of securities and other assets;
WHEREAS, the Distributor is registered as a broker-dealer under
the Securities Exchange Act of 1934, as amended (the "1934 Act"), and
is a member of the National Association of Securities Dealers, Inc.
(the "NASD"); and
WHEREAS, the Trust and Distributor desire to enter into an
agreement pursuant to which Distributor shall be the distributor of
the shares of the Trust representing the investment portfolios
described on Schedule A hereto and any additional shares and/or
investment portfolios the Trust and Distributor may agree upon and
include on Schedule A as such Schedule may be amended from time to
time (such shares and any additional shares are referred to as the
"Shares" and such investment portfolios and any additional investment
portfolios are individually referred to as a "Fund" and collectively
the "Funds").
NOW, THEREFORE, in consideration of the mutual promises and
agreements herein contained and other good and valuable consideration,
the receipt of which is hereby acknowledged, the parties hereto,
intending to be legally bound, do hereby agree as follows:
1. Appointment of the Distributor.
The Trust hereby appoints the Distributor as agent for the
distribution of the Shares, on the terms and for the period set forth
in this Agreement. Distributor hereby accepts such appointment as
agent for the distribution of the Shares on the terms and for the
period set forth in this Agreement.
2. Services and Duties of the Distributor.
2.1 Distributor will act as agent for the distribution of
Shares in accordance with the instructions of the Trust's Board of
Trustees and the registration statement and prospectuses then in
effect with respect to the Funds under the Securities Act of 1933, as
amended (the "1933 Act").
2.2 Distributor may incur expenses for appropriate
distribution activities which it deems reasonable which are primarily
intended to result in the sale of Shares, including, but not limited
to, advertising, the printing and mailing of prospectuses to other
than current shareholders, and the printing and mailing of sales
literature. At the direction of the Trust, Distributor may enter into
servicing and/or selling agreements with qualified broker/dealers and
other persons with respect to the offering of Shares to the public,
and if it so chooses Distributor may act as principal. The Distributor
shall not be obligated to incur any specific expenses nor sell any
certain number of Shares of any Fund.
2.3 All Shares of the Funds offered for sale by Distributor
shall be offered for sale to the public at a price per share (the
"offering price") provided in the Funds' then current prospectus. The
Distributor shall have no liability for the payment of the purchase
price of the Shares sold pursuant to this Agreement or with respect to
redemptions or repurchases of Shares.
2.4 Distributor shall act as distributor of the Shares in
compliance in all material respects with all applicable laws, rules
and regulations, including, without limitation, all rules and
regulations made or adopted pursuant to the 1940 Act, by the
Securities and Exchange Commission (the "Commission") and the NASD.
2.5 Distributor shall not utilize any materials in connection
with the sales or offering of Shares except the Trust's prospectus and
statement of additional information and such other materials as the
Trust shall provide or approve. The Distributor agrees to provide
compliance review of all sales literature and marketing materials
prepared for use by or on behalf of the Trust in advance of the use of
such materials. The Fund agrees to incorporate such changes to such
materials as the Distributor shall request. The Distributor will file
the materials as may be required with the NASD, SEC or state
securities commissioners. The Trust represents that it will not use or
authorize the use of any advertising or sales material unless and
until such materials have been approved and authorized for use by the
Distributor.
2.5 As compensation for the services performed hereunder and
the expenses incurred by Distributor, the Distributor shall be
entitled to the fees and be reimbursed the expenses as provided in
Exhibit B hereto.
3. Duties and Representations of the Trust.
3.1 The Trust represents that it is registered as an open-end
management investment company under the 1940 Act and that it has and
will continue to act in conformity with its Declaration of Trust, By-
Laws, its registration statement as may be amended from time to time
and resolutions and other instructions of its Board of Trustees and
has and will continue to comply with all applicable laws, rules and
regulations including without limitation the 1933 Act, the 1934 Act,
the 1940 Act, the laws of the states in which shares of the Funds are
offered and sold, and the rules and regulations thereunder.
3.2 The Trust shall take or cause to be taken all necessary
action to register and maintain the registration of the Shares under
the 1933 Act for sale as herein contemplated and shall pay all costs
and expenses in connection with the registration of Shares under the
1933 Act, and be responsible for all expenses in connection with
maintaining facilities for the issue and transfer of Shares and for
supplying information, prices and other data to be furnished by the
Trust hereunder.
3.3 The Trust shall execute any and all documents and furnish
any and all information and otherwise take all actions which may be
reasonably necessary in the discretion of the Trust's officers in
connection with the qualification of the Shares for sale in such
states as Distributor and the Trust may approve, shall maintain the
qualification of a sufficient number or amount of shares thereunder,
and shall pay all costs and expenses in connection with such
qualification. The Trust shall notify the Distributor, or cause it to
be notified, of the states in which the Shares may be sold and shall
notify the Distributor of any change to the information.
3.4 The Trust shall, at its expense, keep the Distributor
fully informed with regard to its affairs. In addition, the Trust
shall furnish Distributor from time to time such information,
documents and reports with respect to the Trust and the Shares as
Distributor may reasonably request, and the Trust warrants that the
statements contained in any such information shall be true and correct
and fairly represent what they purport to represent.
3.5 The Trust represents to Distributor that all registration
statements and prospectuses of the Trust filed or to be filed with the
Commission under the 1933 Act and 1940 Act with respect to the Shares
have been and will be prepared in conformity with the requirements of
the 1933 Act, the 1940 Act, and the rules and regulations of the
Commission thereunder. As used in this Agreement the terms
"registration statement" and "prospectus" shall mean any registration
statement and prospectus (together with the related statement of
additional information) at any time now or hereafter filed with the
Commission with respect to any of the Shares and any amendments and
supplements thereto which at any time shall have been or will be filed
with said Commission. The Trust represents and warrants to
Distributor that any registration statement and prospectus, when such
registration statement becomes effective, will contain all statements
required to be stated therein in conformity with the 1933 Act, the
1940 Act and the rules and regulations of the Commission; that all
information contained in the registration statement and prospectus
will be true and correct in all material respects when such
registration statement becomes effective; and that neither the
registration statement nor any prospectus 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.
The Trust agrees to file from time to time such amendments,
supplements, reports and other documents as may be necessary or
required in order to comply with the 1933 Act and the 1940 Act and in
order that there may be no untrue statement of a material fact in a
registration statement or prospectus, or necessary or required in
order that there may be no omission to state a material fact in the
registration statement or prospectus which omission would make the
statements therein misleading. The Trust shall promptly notify the
Distributor of any advice given to it by counsel to the Trust
regarding the necessity or advisability of amending or supplementing
the registration statement.
3.6 The Trust shall not file any amendment to the registration
statement or supplement to any prospectus without giving Distributor
reasonable notice thereof in advance and if the Distributor declines
to assent to such amendment (after a reasonable time), the Trust may
terminate this Agreement forthwith by written notice to the
Distributor without payment of any penalty. If the Trust shall not
propose an amendment or amendments and/or supplement or supplements
promptly after receipt by the Trust of a written request in good faith
from Distributor to do so, Distributor may, at its option, immediately
terminate this Agreement. In addition, if, at any time during the term
of this Agreement, the Distributor requests the Trust to make any
change in its governing instruments or in its methods of doing
business which are necessary in order to comply with any requirement
of applicable law or regulation, and the Trust fails to make any such
change as requested, the Distributor may terminate this Agreement
forthwith by written notice to the Trust without payment of any
penalty. Nothing contained in this Agreement shall in any way limit
the Trust's right or obligation to file at any time any amendments to
any registration statement and/or supplements to any prospectus, of
whatever character, as the Trust may deem advisable, with advice of
its counsel, such right being in all respects absolute and
unconditional.
3.7 Whenever in their judgment such action is warranted by
market, economic or political conditions, or by circumstances of any
kind, the Trust may decline to accept any orders for, or make any
sales of, any Shares until such time as it deems it advisable to
accept such orders and to make such sales and the Trust shall advise
Distributor promptly of such determination.
3.8 The Trust agrees to advise the Distributor promptly in
writing:
(i) of any correspondence or other communication by the
Commission or its staff relating to the Funds including requests by
the Commission for amendments to the registration statement or
prospectuses;
(ii) in the event of the issuance by the Commission of
any stop order suspending the effectiveness of the registration
statement or prospectuses then in effect or the initiation of any
proceeding for that purpose;
(iii) of the happening of any event which makes untrue any
statement of a material fact made in the registration statement or
prospectuses or which requires the making of a change in such
registration statement or prospectuses in order to make the statements
therein not misleading; and
(iv) of all actions taken by the Commission with respect
to any amendments to any registration statement or prospectus which
may from time to time be filed with the Commission.
4. Indemnification.
4.1(a) The Trust authorizes Distributor to use any
prospectus or statement of additional information, in the form
furnished to Distributor from time to time, in connection with the
sale of Shares. The Trust shall indemnify, defend and hold the
Distributor, and each of its present or former directors, members,
officers, employees, representatives and any person who controls or
previously controlled the Distributor within the meaning of Section 15
of the 1933 Act ("Distributor Indemnitees"), free and harmless (a)
from and against any and all losses, claims, demands, liabilities,
damages, charges, payments, costs and expenses (including the costs of
investigating or defending any alleged losses, claims, demands,
liabilities, damages, charges, payments, costs or expenses and any
counsel fees incurred in connection therewith) of any and every nature
("Losses") which Distributor and/or each of the Distributor
Indemnitees may incur under the 1933 Act, the 1934 Act, any other
statute (including Blue Sky laws) or any rule or regulation
thereunder, or under common law or otherwise, arising out of or based
upon any untrue statement, or alleged untrue statement, of a material
fact contained in the registration statement or any prospectus, an
annual or interim report to shareholders or sales literature, or any
amendments or supplements thereto, or arising out of or based upon any
omission, or alleged omission, to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that the Trust's obligation
to indemnify Distributor and any of the foregoing indemnitees shall
not be deemed to cover any Losses arising out of any untrue statement
or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with information relating
to the Distributor and furnished to the Trust or its counsel by
Distributor in writing for the purpose of, and used in, the
preparation thereof; (b) from and against any and all Losses which
Distributor and/or each of the Distributor Indemnitees may incur in
connection with this Agreement or the Distributor's performance
hereunder, except to the extent the Losses result from the
Distributor's willful misfeasance, bad faith or gross negligence in
the performance of its duties, or by reason of its reckless disregard
of its obligations and duties under this Agreement, (c) from and
against any and all Losses which Distributor and/or each of the
Distributor Indemnitees may incur resulting from the actions or
inactions of any prior service provider to the Funds, or (d) from and
against any and all Losses which Distributor and/or each of the
Distributor Indemnitees may incur when acting in accordance with
instructions from the Trust or its representatives. Promptly after
receipt by the Distributor of notice of the commencement of an
investigation, action, claim or proceeding, the Distributor shall, if
a claim for indemnification in respect thereof is to made under this
section, notify the Trust in writing of the commencement thereof,
although the failure to do so shall not prevent recovery by the
Distributor or any Distributor Indemnitee.
4.1(b) The Trust shall be entitled to participate at its
own expense in the defense or, if it so elects, to assume the defense
of any suit brought to enforce any such loss, claim, demand,
liability, damage or expense, but if the Trust elects to assume the
defense, such defense shall be conducted by counsel chosen by the
Trust and approved by the Distributor, which approval shall not be
unreasonably withheld. In the event the Trust elects to assume the
defense of any such suit and retain such counsel and notifies the
Distributor of such election, the indemnified defendant or defendants
in such suit shall bear the fees and expenses of any additional
counsel retained by them subsequent to the receipt of the Trust's
election. If the Trust does not elect to assume the defense of any
such suit, or in case the Distributor does not, in the exercise of
reasonable judgment, approve of counsel chosen by the Trust, or in
case there is a conflict of interest between the Trust and the
Distributor or any of the Distributor Indemnitees, the Trust will
reimburse the indemnified person or persons named as defendant or
defendants in such suit, for the fees and expenses of any counsel
retained by Distributor and them. The Trust's indemnification
agreement contained in this Section 4.1 and the Trust's
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 the Distributor and each of the Distributor
Indemnitees, and shall survive the delivery of any Shares and the
termination of this Agreement. This agreement of indemnity will inure
exclusively to the Distributor's benefit, to the benefit of each of
the Distributor Indemnitees, and their estates and successors. The
Trust agrees promptly to notify Distributor of the commencement of any
litigation or proceedings against the Trust or any of its officers or
trustees in connection with the issue and sale of any of the Shares.
4.1(c) The Trust acknowledges and agrees that in the event
the Distributor, at the direction of the Trust, is required to give
indemnification to any entity selling Shares or providing shareholder
services to shareholders or others and such entity shall make a claim
for indemnification against the Distributor, the Distributor shall
make a similar claim for indemnification against the Trust and shall
be entitled to such indemnification.
4.2(a) Distributor shall indemnify, defend and hold the
Trust, and each of its present or former trustees, officers,
employees, representatives, and any person who controls or previously
controlled the Trust within the meaning of Section 15 of the 1933 Act
("Trust Indemnitees"), free and harmless from and against any and all
Losses which the Trust, and each of its present or former trustees,
officers, employees, representatives, or any such controlling person,
may incur under the 1933 Act, the 1934 Act, any other statute
(including Blue Sky laws) or any rule or regulation thereunder, or
under common law or otherwise, (a) arising out of or based upon any
untrue, or alleged untrue, statement of a material fact contained in
the Trust's registration statement or any prospectus, as from time to
time amended or supplemented, or the omission, or alleged omission, to
state therein a material fact required to be stated therein or
necessary to make the statement not misleading, but only if such
statement or omission was made in reliance upon, and in conformity
with, information relating to the Distributor and furnished in writing
to the Trust or its counsel by the Distributor for the purpose of, and
used in, the preparation thereof, and (b) to the extent any Losses
arise out of or result from the Distributor's willful misfeasance, bad
faith or gross negligence in the performance of its duties, or by
reason of its reckless disregard of its obligations and duties under
this Agreement; Distributor's agreement to indemnify the Trust and any
of the Trust Indemnitees shall not be deemed to cover any Losses to
the extent they arise out of or result from the Trust's willful
misfeasance, bad faith or negligence in the performance of its duties,
or by reason of its reckless disregard of its obligations and duties,
under this Agreement. Promptly after receipt by the Trust of notice of
the commencement of an investigation, action, claim or proceeding, the
Trust shall, if a claim for indemnification in respect thereof is to
made under this section, notify the Distributor in writing of the
commencement thereof, although the failure to do so shall not prevent
recovery by the Trust or any Trust Indemnitee.
4.2(b) The Distributor shall be entitled to participate at
its own expense in the defense or, if it so elects, to assume the
defense of any suit brought to enforce any such loss, claim, demand,
liability, damage or expense, but if the Distributor elects to assume
the defense, such defense shall be conducted by counsel chosen by the
Distributor and approved by the Trust, which approval shall not be
unreasonably withheld. In the event the Distributor elects to assume
the defense of any such suit and retain such counsel and notifies the
distributor of such election, the indemnified defendant or defendants
in such suit shall bear the fees and expenses of any additional
counsel retained by them subsequent to the receipt of the
Distributor's election. If the Distributor does not elect to assume
the defense of any such suit, or in case the Trust does not, in the
exercise of reasonable judgment, approve of counsel chosen by the
Distributor, the Distributor will reimburse the indemnified person or
persons named as defendant or defendants in such suit, for the fees
and expenses of any counsel retained by the Trust and them. The
Distributor's indemnification agreement contained in this Section 4.2
and the Distributor's 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 the Trust or any of the Trust
Indemnitees, and shall survive the delivery of any Shares and the
termination of this Agreement. This agreement of indemnity will inure
exclusively to the Trust's benefit, to the benefit of each of the
Trust Indemnitees and their estates and successors. The Distributor
agrees promptly to notify the Trust of the commencement of any
litigation or proceedings against the Distributor or any of its
officers or members in connection with the issue and sale of any of
the Shares.
5. Offering of Shares.
No Shares shall be offered by either the Distributor or the
Trust under any of the provisions of this Agreement and no orders for
the purchase or sale of such Shares hereunder shall be accepted by the
Trust if and so long as the effectiveness of the registration
statement then in effect or any necessary amendments thereto shall be
suspended under any of the provisions of the 1933 Act, or if and so
long as the current prospectus as required by Section 10 of the 1933
Act, as amended, is not on file with the Commission; provided,
however, that nothing contained in this paragraph 5 shall in any way
restrict or have an application to or bearing upon the Trust's
obligation to repurchase Shares from any shareholder in accordance
with the provisions of the prospectus or Articles of Trust.
6. Limitation of Liability
6.1 The Distributor shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the Company in
connection with the performance of its obligations and duties under
this Agreement, except a loss resulting from the Distributor's willful
misfeasance, bad faith or gross negligence in the performance of such
duties and obligations, or by reason of its reckless disregard
thereof. Furthermore, notwithstanding anything herein to the
contrary, the Distributor shall not be liable for any action taken or
omitted to be taken in accordance with instructions received by the
Distributor from an officer or representative of the Trust or for any
action taken or omitted to be taken by any prior service provider of
the Funds.
6.2 The Distributor assumes no responsibility
hereunder, and shall not be liable, for any default, damage, loss of
data, errors, delay or any other loss whatsoever caused by events
beyond its reasonable control. The Distributor will, however, take
all reasonable steps to minimize service interruptions for any period
that such interruption continues beyond its control. Notwithstanding
anything in this agreement to the contrary, in no event shall either
party, its affiliates or any of its or their trustees, members,
officers, employees, agents or subcontractors, be liable for lost
profits or consequential damages.
7. Term.
7.1 This Agreement shall become effective with respect to each
Fund listed on Schedule A hereof as of the date hereof and, with
respect to each Fund not in existence on that date, on the date an
amendment to Schedule A to this Agreement relating to that Fund is
executed. Unless sooner terminated as provided herein, this Agreement
shall continue in effect with respect to each Fund until __________,
200_. Thereafter, if not terminated, this Agreement shall continue
automatically in effect as to each Fund for successive annual periods,
provided such continuance is specifically approved at least annually
by (i) the Trust's Board of Trustees or (ii) the vote of a majority
(as defined in the 1940 Act and Rule 18f-2 thereunder) of the
outstanding voting securities of a Fund, and provided that in either
event the continuance is also approved by a majority of the Trust's
Board of Trustees 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.
7.2 This Agreement may be terminated without penalty with
respect to a particular Fund (1) through a failure to renew this
Agreement at the end of a term, (2) upon mutual consent of the
parties, or (3) on no less than thirty (30) days' written notice, by
the Trust's Board of Trustees, by vote of a majority (as defined with
respect to voting securities in the 1940 Act and Rule 18f-2
thereunder) of the outstanding voting securities of a Fund, or by the
Distributor (which notice may be waived by the party entitled to such
notice). The terms of this Agreement shall not be waived, altered,
modified, amended or supplemented in any manner whatsoever except by a
written instrument signed by the Distributor and the Trust. This
Agreement will also terminate automatically in the event of its
assignment (as defined in the 1940 Act).
7.3 In the event of termination of this Agreement, all
reasonable expenses associated with movement of records and materials
and conversion thereof shall be borne by the Funds.
8. Miscellaneous.
8.1 The services of the Distributor rendered to the Funds are
not deemed to be exclusive. The Distributor may render such services
and any other services to others, including other investment
companies. The Trust recognizes that from time to time members,
officers, and employees of the Distributor may serve as directors,
trustees, officers and employees of other entities (including other
investment companies), that such other entities may include the name
of the Distributor as part of their name and that the Distributor or
its affiliates may enter into distribution, administration, fund
accounting, transfer agent or other agreements with such other
entities.
8.2 The Distributor agrees on behalf of itself and its
employees to treat confidentially and as proprietary information of
the Trust all records relative to the Funds' shareholders, not to use
such records and information for any purpose other than performance of
its responsibilities and duties hereunder, and not to disclose such
information except where the Distributor may be exposed to civil or
criminal proceedings for failure to comply, when requested to divulge
such information by duly constituted authorities or court process,
when subject to governmental or regulatory audit or investigation, or
when so requested by the Trust. In case of any requests or demands
for inspection of the records of the Funds, the Distributor will
endeavor to notify the Trust promptly and to secure instructions from
a representative of the Trust as to such inspection. Records and
information which have become known to the public through no wrongful
act of the Distributor or any of its employees, agents or
representatives, and information which was already in the possession
of the Distributor prior to receipt thereof, shall not be subject to
this paragraph.
8.3 This Agreement shall be governed by Wisconsin law,
excluding the laws on conflicts of laws. To the extent that the
applicable laws of the State of Wisconsin, or any of the provisions
herein, conflict with the applicable provisions of the 1940 Act, the
latter shall control, and nothing herein shall be construed in a
manner inconsistent with the 1940 Act or any rule or order of the
Commission thereunder. Any provision of this Agreement which may be
determined by competent authority to be prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating
the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. In such case,
the parties shall in good faith modify or substitute such provision
consistent with the original intent of the parties.
8.4 Any notice required or to be permitted to be given by
either party to the other shall be in writing and shall be deemed to
have been given when sent by registered or certified mail, postage
prepaid, return receipt requested, as follows: Notice to the
Distributor shall be sent to UMB Distribution Services, LLC, 000 Xxxx
Xxxxxxxx Xxxxxx, Xxxxx X, Xxxxxxxxx, XX, 00000, Attention: Xxxxx
Xxxxxxx, and notice to the Trust shall be sent to ___________________
Attention: ______________.
8.5 This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original
agreement but such counterparts shall together constitute but one and
the same instrument.
8.6 The captions of this Agreement are included for
convenience of reference only and in no way define or delimit any of
the provisions hereof or otherwise effect their construction or
effect.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by a duly authorized officer as of the day
and year first above written.
________________________
(the "Trust")
By:________________________________________
____
UMB DISTRIBUTION SERVICES, LLC
(the "Distributor")
By: ______________________________________
Schedule A
to the
Distribution Agreement
by and between
______________
and
UMB Distribution Services, LLC
Name of Funds
Fund
Effective Date
Schedule B
to the
Distribution Agreement
by and between
______________
and
UMB Distribution Services, LLC
FEES
(to be provided)
