FORM OF DISTRIBUTION AGREEMENT
Ex. e2
AGREEMENT made this day of May, 2012 between TRUST FOR CREDIT UNIONS, a Massachusetts
business trust (the “Fund”), and XXXXXXXX FINANCIAL SERVICES, INC., a Delaware corporation (the
“Distributor”).
W I T N E S S E T H:
WHEREAS, the Fund is engaged in business as an open-end, diversified management investment
company and is so registered under the Investment Company Act of 1940, as amended (the “1940 Act”);
and
WHEREAS, the Fund is authorized to issue units of beneficial interest (“shares”) in separate
series and classes, with each such series and any class or classes within such series representing
the interests in a separate portfolio of securities and other assets; and
WHEREAS, the Fund at present offers shares of one class (“TCU Shares”) in the Money Market
Portfolio, the Ultra Short Duration Government Portfolio and the Short Duration Portfolio (the
“Current Portfolios”); and
WHEREAS, the Fund desires to retain the Distributor to act as distributor to provide for the
sale and distribution of (a) TCU Shares of the Current Portfolios and all other portfolios
subsequently established by the Fund (such portfolios together with the Current Portfolios being
hereafter referred to as the “Portfolios”) and (b) shares of each new class of the Portfolios
established in the future (such new classes of shares together with the TCU Shares being hereafter
referred to as the “Shares”), and the Distributor is willing to so render such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained and
other good and valuable consideration, receipt whereof is hereby acknowledged, the parties hereto
agree as follows:
1. Appointment of Distributor. The Fund hereby appoints the Distributor as
distributor of the Shares of each of the Portfolios on the terms and for the periods set forth in
this Agreement. The Distributor hereby accepts such appointment and agrees to render the services
and perform the duties set forth in this paragraph 1 and in paragraphs 2 and 4.
2. Duties as Distributor. The following provisions shall apply to the Distributor’s
obligations as distributor under this Agreement:
(a) The Fund agrees to sell Shares of each of the Portfolios through the Distributor,
as agent, from time to time during the term of this Agreement upon the terms and at the
current offering price described in the Fund’s then current prospectus(es) and Statement(s)
of Additional Information as amended from time to time (collectively, the “Prospectus”).
Such sales may, however, be suspended whenever in the judgment of the Fund it is in its best
interests to do so;
(b) The Distributor will arrange for the receipt of orders for the purchase of Shares
of each Portfolio and will (and shall have the authority to) arrange for the receipt and
acceptance or rejection of such orders on behalf of the Fund in accordance with the
provisions of the Prospectus;
(c) The Distributor shall not be obligated to sell any certain number of Shares of any
Portfolio;
(d) In performing its duties hereunder, the Distributor shall act in conformity with
the Fund’s Second Amended and Restated Declaration of Trust dated August 19, 2011 as amended
from time to time (the “Trust Agreement”), the Fund’s Amended and Restated By-Laws dated
August 19, 2011 as amended from time to time (the “By-Laws”), the Prospectus and the Fund’s
Registration Statement on Form N-1A with
- 2 -
respect to the Portfolios as amended from time to time (the “Registration Statement”)
and with the instructions and directions of the Trustees of the Fund, and will use its best
efforts to comply with and conform to the requirements of the 1940 Act, the Securities Act
of 1933, as amended (the “1933 Act”), the Securities Exchange Act of 1934, as amended (the
“1934 Act”), the Investment Advisers Act of 1940, as amended, the Financial Industry
Regulatory Authority, Inc., and all other applicable federal and state laws, regulations and
rulings; and
(e) The services of the Distributor hereunder are not deemed exclusive and the
Distributor shall be free to render similar services to others so long as the Distributor’s
services hereunder are not impaired thereby.
3. Distribution Costs. During the term of this Agreement, the Distributor will pay
the following costs:
(a) Costs of all sales presentations, mailings, advertising and any other distribution
efforts by the Distributor with respect to the Shares of each of the Portfolios; and
(b) Compensation of any personnel of the Distributor for activities in connection with
the distribution or sale of the Shares of each of the Portfolios; and
(c) Any payments made in accordance with any plan adopted pursuant to Rule 12b-1 under
the 1940 Act (“12b-1 Plan”).
4. 12b-1 Plans.
(a) The Fund may from time to time adopt one or more 12b-1 Plans with respect to one or
more classes of Shares of the Portfolios. The Fund shall pay the Distributor as distributor
of such class or classes of Shares the compensation pursuant to
- 3 -
the 12b-1 Plans as shall be set forth from time to time in the Prospectus and provided
for under the applicable 12b-1 Plan.
(b) The Distributor shall prepare reports for the Board of Trustees of the Trust as
from time to time shall be reasonably requested by the Board regarding the use of 12b-1 Plan
payments received by the Distributor, if any.
(c) The Distributor is authorized to enter into written agreements with broker/dealers
and other financial institutions, under such conditions and based on such form(s) of selling
agreements as may be approved by the Board of Trustees from time to time. In entering into
and performing such agreements, the Distributor shall act as principal and not as agent for
the Fund or any Portfolio. Upon the failure of any broker/dealer or other financial
institution to pay for any order for the purchase of Shares in accordance with the terms of
the Prospectus, the Fund shall have the right to cancel the sale of such Shares and
thereupon the Distributor shall be responsible for any loss sustained as a result thereof.
5. Duration and Termination. This Agreement shall continue, unless sooner terminated
as provided herein, until March 31, 2013 and thereafter shall continue automatically for periods of
one year so long as each such continuance is approved at least annually (a) by the vote of a
majority of the Trustees of the Fund who are not parties to this Agreement or interested persons
(as defined in the 0000 Xxx) of any such party, cast in person at a meeting called for the purpose
of voting on such approval, and (b) by the Trustees of the Fund or by a vote of a majority of the
outstanding Shares (as defined with respect to voting securities in the 1940 Act) representing the
interests in each Portfolio affected thereby; provided, however, that this
Agreement may be terminated by the Fund at any time, without the payment of any penalty, on
- 4 -
60 days’ written notice to the Distributor or by the Distributor at any time, without the
payment of any penalty, on 60 days’ written notice to the Fund. This Agreement will automatically
and immediately terminate in the event of its assignment (as defined in the 1940 Act).
6. Amendment of Agreement. This Agreement may be amended by mutual consent, but the
consent of the Fund must be approved by vote of a majority of those Trustees of the Fund who are
not parties to this Agreement or interested persons (as defined in the 0000 Xxx) of any such party,
cast in person at a meeting called for the purpose of voting on such amendment. Any amendment to
this Agreement shall only be by written instrument which shall make specific reference to this
Agreement and which shall be signed by the party against which enforcement of such change, waiver,
discharge or termination is sought.
7. Indemnification.
(a) The Distributor shall not be liable for any error in judgment or mistake of law or
for any loss suffered by the Fund in connection with the matters to which this Agreement
relates, except a loss resulting from willful misfeasance, bad faith or gross negligence in
the performance of its obligations and duties under this Agreement, or by reason of its
reckless disregard of its obligations and duties under this Agreement.
(b) The Fund hereby agrees to indemnify and hold harmless the Distributor, its
officers, directors and employees and each person who controls the Distributor
(collectively, the “Indemnified Parties”) against any and all losses, claims, damages or
liabilities, joint or several, to which any such Indemnified Party may become subject under
the 1933 Act, the Securities Exchange Act of 1934 (as amended), the 1940 Act or other
federal or state statutory law or regulation, at common law or otherwise, insofar as
- 5 -
such losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon:
(i) any untrue statement or alleged untrue statement of a material fact or any
omission or alleged omission to state a material fact required to be stated or
necessary to make the statements made not misleading in (x) the Prospectus, or the
Registration Statement, (y) any advertisements or sales literature authorized by the
Fund for use in the offer and sale of Shares of any Portfolio, or (z) any
application or other document filed in connection with the qualification of the Fund
or Shares of any Portfolio under the Blue Sky or securities laws of any
jurisdiction, except insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any such untrue statement
or omission or alleged untrue statement or omission made in reliance upon and in
conformity with information furnished to the Fund by or on behalf of the Distributor
pertaining to or originating with the Distributor for use in connection with any
document referred to in clauses (x), (y) or (z) , or
(ii) subject to clause (i) above, the Distributor acting hereunder;
and the Fund will reimburse each Indemnified Party for any legal or other expenses incurred
by such Indemnified Party in connection with investigating or defending any such loss,
claim, damage, liability or action.
(c) If the indemnification provided for in paragraph 7(b) is available in accordance
with the terms of such paragraph but is for any reason held by a court to be unavailable
from the Fund, then the Fund shall contribute to the aggregate amount paid or payable by the
Fund and the Indemnified Parties as a result of such losses, claims,
- 6 -
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the Fund and the Indemnified
Parties in connection with the operations of the Fund, (ii) the relative fault of the Fund
and such Indemnified Parties, and (iii) any other relevant equitable considerations. The
Fund and the Distributor agree that it would not be just and equitable if contribution
pursuant to this subparagraph (c) were determined solely by pro rata allocation or any other
method of allocation which does not take into account the equitable considerations referred
to above in this subparagraph (c). The aggregate amount paid or payable as a result of the
losses, claims, damages or liabilities (or actions in respect thereof) referred to above in
this subparagraph (c) shall be deemed to include any legal or other expenses incurred by the
Fund and Indemnified Parties in connection with investigating or defending any such loss,
claim, damage, liability or action. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 0000 Xxx) shall be entitled to contribution from
any person who is not guilty of such fraudulent misrepresentation.
(d) It is understood, however, that nothing in this paragraph 7 shall protect any
Indemnified Party against, or entitle any Indemnified Party to indemnification against, or
contribution with respect to, any liability to the Fund or its Shareholders to which such
Indemnified Party is subject, by reason of its willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of any reckless disregard of its
obligations and duties, under this Agreement, or otherwise to an extent or in a manner that
is inconsistent with Section 17(i) of the 1940 Act.
8. Shareholder Liability. This Agreement is executed by or on behalf of the Fund and
the obligations hereunder are not binding upon any of the Trustees, officers or
- 7 -
Shareholders of the Fund individually but are binding only upon the Fund and its assets and
property.
9. Status of Distributor as Independent Contractor. The Distributor shall for all
purposes herein be deemed to be an independent contractor and shall, unless otherwise expressly
provided herein or authorized by the Trustees of the Fund or Xxxxxxx Xxxxx Asset Management, L.P.
(the “Adviser”), respectively, from time to time, have no authority to act for or represent the
Fund or the Adviser in any way or otherwise be deemed an agent of the Fund or the Adviser.
10. Notices. Without limiting the other provisions hereof, notices and other writings
delivered or mailed postage prepaid to the Fund, c/o BNY Mellon Investment Servicing (US) Inc.,
0000 Xxxxxxxx Xxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000, Attention: Chairman, with a copy to Xxxxxx
X. Xxxxx, Xxxxx & Xxxxxxx, 000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, or to the
Distributor, 0000 Xxxxxxxxxxx Xxxxxx, X.X., Xxxxx 0000, Xxxxxxxxxx, X.X. 00000, Attention:
President, or to such other address as the Fund or the Distributor may hereafter specify by written
notice to the most recent address specified by the party to whom such notice is addressed, shall be
deemed to have been properly delivered or given hereunder to the respective addressee.
11. Miscellaneous. The captions in this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof or otherwise affect
their construction or effect. If any provision of this Agreement shall be held or made invalid by
a court decision, statute, rule or otherwise, the remainder of this Agreement shall not be affected
thereby. This Agreement shall be construed in accordance with applicable federal law and the laws
of The Commonwealth of Massachusetts and shall be binding upon and
- 8 -
shall inure to the benefit of the parties hereto and their respective successors, subject to
paragraph 4 hereof.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed as of the
day and year first above written.
| ATTEST: | TRUST FOR CREDIT UNIONS | |||||
| By | ||||||
Xxxx Xx Xxxxxx Secretary |
Xxxxxxx X. Xxxxxx President |
|||||
| ATTEST: | XXXXXXXX FINANCIAL SERVICES, INC. | |||||
| By | ||||||
| Xxx Xxxxxxx Executive Vice President |
||||||
- 9 -
