RULE 12d1-4 FUND OF FUNDS INVESTMENT AGREEMENT
RULE 12d1-4
FUND OF FUNDS INVESTMENT AGREEMENT
THIS AGREEMENT, is made this 10th of January, 2022, by and between the trust identified on Schedule A (the “Acquiring Trust”), on behalf of itself and its respective series identified on Schedule A, severally and not jointly (each, an “Acquiring Fund”), and the trust identified on Schedule B (the “Acquired Trust”), on behalf of itself and its respective series identified on Schedule B, severally and not jointly (each, an “Acquired Fund” and together with the Acquiring Funds, the “Funds”), and shall be effective January 19, 2022.
WHEREAS, each Fund is registered with the U.S. Securities and Exchange Commission (“SEC”) as an investment company under the Investment Company Act of 1940, as amended, (the “1940 Act”);
WHEREAS, Section 12(d)(1)(A) of the 1940 Act limits the extent to which a registered investment company may invest in shares of other registered investment companies, Section 12(d)(1)(B) limits the extent to which a registered investment company, its principal underwriter or registered brokers or dealers may knowingly sell shares of such registered investment company to other investment companies, and Section 12(d)(1)(C) limits the extent to which an investment company may invest in the shares of a registered closed-end investment company;
WHEREAS, Rule 12d1-4 under the 1940 Act (the “Rule”) permits registered investment companies, such as the Acquiring Funds, to invest in shares of other registered investment companies, such as the Acquired Funds, in excess of the limits of Section 12(d)(1) of the 1940 Act subject to compliance with the conditions of the Rule; and
WHEREAS, an Acquiring Fund may, from time to time, invest in shares of one or more Acquired Funds in excess of the limitations of Section 12(d)(1)(A) in reliance on the Rule.
NOW THEREFORE, in accordance with the Rule, the Acquiring Funds and the Acquired Funds desire to set forth the following terms pursuant to which the Acquiring Funds may invest in the Acquired Funds in reliance on the Rule.
1. Terms of Investment
(a) In order to help reasonably address the risk of undue influence on an Acquired Fund by an Acquiring Fund, and to assist the Acquired Fund’s investment adviser with making the required findings under the Rule, each Acquiring Fund and each Acquired Fund agree as follows:
(i) In-kind redemptions. The Acquiring Fund acknowledges and agrees that, if and to the extent consistent with the Acquired Fund’s registration statement, as amended from time to time, and Rule 6c-11, as applicable, the Acquired Fund may honor any redemption request partially or wholly in-kind.
(ii) Timing/advance notice of redemptions. The Acquiring Fund will use reasonable efforts to comply with the relevant redemption protocols identified on Schedule C to this Agreement, as may be updated by the Acquired Trust from
time to time, whenever practicable and consistent with the Acquiring Fund’s best interests. The Acquired Fund acknowledges and agrees that any notification provided pursuant to the foregoing is not a commitment to redeem and constitutes an estimate that may differ materially from the amount, timing and manner in which a redemption request is submitted, if any.
(iii) Scale of investment. The Acquiring Fund will use reasonable efforts to comply with the relevant protocols identified on Schedule C to this Agreement, as may be updated by the Acquired Trust, from time to time, regarding the scale of its investment in each Acquired Fund. The Acquired Fund acknowledges and agrees that any information provided pursuant to the foregoing is not a commitment to purchase and constitutes an estimate that may differ materially from the amount, timing and manner in which a purchase order is submitted, if any.
(b) In order to assist the Acquiring Fund’s investment adviser with evaluating the complexity of the structure and fees and expenses associated with an investment in an Acquired Fund, each Acquired Fund shall provide each Acquiring Fund and its investment adviser with information on the fees and expenses of the Acquired Fund reasonably requested by the Acquiring Fund with reference to the Rule. For the avoidance of doubt, the Acquiring Fund acknowledges and agrees that any information provided by the Acquired Fund under this section is limited to publicly available fee and expense information.
2. Representations of the Acquired Funds.
In connection with any investment by an Acquiring Fund in an Acquired Fund in excess of the limitations in Section 12(d)(1)(A), the Acquired Fund agrees to: (i) comply with all conditions of the Rule, as interpreted or modified by the SEC or its Staff from time to time, applicable to Acquired Funds; (ii) comply with its obligations under this Agreement; and (iii) promptly notify the Acquiring Fund if such Acquired Fund fails to comply with the Rule with respect to an investment by the Acquiring Fund, as interpreted or modified by the SEC or its Staff from time to time, or this Agreement.
Prior to an Acquired Fund’s initial acceptance of any investment from an Acquiring Fund in excess of the limit in Section 12(d)(1)(A)(i) pursuant to the terms of this Agreement, the Acquired Fund shall provide written confirmation to the Acquiring Fund that the Acquired Fund’s investment adviser has made all findings required on behalf of the Acquired Fund in accordance with the Rule.
3. Representations of the Acquiring Funds.
In connection with any investment by an Acquiring Fund in an Acquired Fund in excess of the limitations in Section 12(d)(1)(A), the Acquiring Fund agrees to: (i) comply with all conditions of the Rule, as interpreted or modified by the SEC or its Staff from time to time, applicable to Acquiring Funds; (ii) comply with its obligations under this Agreement; and (iii) promptly notify the Acquired Fund if such Acquiring Fund fails to comply with the Rule with
respect to its investment in such Acquired Fund, as interpreted or modified by the SEC or its Staff from time to time, or this Agreement.
Prior to an Acquiring Fund’s initial investment in an Acquired Fund in excess of the limit in Section 12(d)(1)(A)(i) pursuant to the terms of this Agreement, the Acquiring Fund shall provide written confirmation to the Acquired Fund that the Acquiring Fund’s investment adviser has made all findings and evaluations required on behalf of the Acquiring Fund in accordance with the Rule.
4. [RESERVED]
5. Notices
All notices, including all information that either party is required to provide under the terms of this Agreement and the Rule, shall be in writing and shall be delivered by registered or overnight mail, facsimile, or electronic mail to the address for each party specified below.
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If to the Acquiring Fund: |
If to the Acquired Fund: |
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Xxxxx Xxxxx, General Counsel |
Xxxxxxx Xxxxxx |
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Senior Vice President, | |
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000 Xxxxxxx Xxxxxx Xxxxx |
Asset Management Compliance |
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Xxxxxxx Xxxxx, XX 00000 |
00 Xxxxx Xxxxxx Xxxxxx |
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Email: |
Xxxxxx, XX 00000 |
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XxxxxxxxXxxxxxxxxxxxx@XxxxxxxXxxx.xxx |
Email: xxxxxxx.xxxxxx@xxx.xxx |
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With a copy to: |
With a copy to: |
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Xxxxxx Xxxxx |
Xxxxx Xxxxxxxxx |
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Attn: Legal Dept. |
Attn: Legal Dept. |
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000 Xxxxxxx Xxxxxx Xxxxx |
00 Xxxxx Xxxxxx Xxxxxx |
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Xxxxxxx Xxxxx, XX 00000 |
Xxxxxx, XX 00000 |
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Email: |
Email: xxxxx.xxxxxxxxx@xxx.xxx |
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XxxxxxxxXxxxxxxxxxxxx@XxxxxxxXxxx.xxx |
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6. Term and Termination; Assignment; Amendment
(a) This Agreement shall be effective for the duration of the Acquired Funds’ and/or the Acquiring Funds’ reliance on the Rule, as interpreted or modified by the SEC or its Staff from time to time. While the terms of the Agreement shall only be applicable to investments in Funds made in reliance on the Rule, as interpreted or modified by the SEC or its Staff from time to time, the Agreement shall continue in effect until terminated pursuant to Section 6(b).
(b) This Agreement shall continue until terminated in writing by either party upon 60 days’ notice to the other party. Upon termination of this Agreement, the Acquiring Fund may not purchase additional shares of the Acquired Fund beyond the Section 12(d)(1)(A) limits in reliance on the Rule.
(c) This Agreement may not be assigned by either party without the prior written consent of the other. In the event either party assigns this Agreement to a third party as provided in this Section, such permitted third party shall be bound by the terms and conditions of this Agreement applicable to the assigning party.
(d) This Agreement may be amended only by a writing that is signed by each affected party.
(e) This Agreement will be governed by the laws of Delaware without regard to its choice of law principles.
(f) In any action involving the Acquiring Funds under this Agreement, each Acquired Fund agrees to look solely to the individual Acquiring Fund that is involved in the matter in controversy and not to any other series of the Acquiring Trusts.
(g) In any action involving the Acquired Funds under this Agreement, each Acquiring Fund agrees to look solely to the individual Acquired Fund that is involved in the matter in controversy and not to any other series of the Acquired Trusts.
7. Miscellaneous
(a) Counterparts. This Agreement may be executed in two or more counterparts, each of which is deemed an original but all of which together constitute one and the same instrument.
(b) Severability. If any provision of this Agreement is determined to be invalid, illegal, in conflict with any law or otherwise unenforceable, the remaining provisions hereof will be considered severable and will not be affected thereby, and every remaining provision hereof will remain in full force and effect and will remain enforceable to the fullest extent permitted by applicable law.
(c) Notice. The Acquiring Funds are hereby expressly put on notice of the limitation of shareholder liability as set forth in the Declaration of Trust (the “Trust Document”) of which each Acquired Fund is a series (the “Trust”) or other organizational documents and agrees that the obligations assumed by the Trust pursuant to this Agreement shall be limited in all cases to the relevant Acquired Fund and its assets, and the Acquiring Funds shall not seek satisfaction of any such obligation from the shareholders or any shareholder of the relevant Acquired Fund or any other series of the Trust. In addition, the Acquiring Funds shall not seek satisfaction of any such obligations from the Trustees or any individual Trustee. The Acquiring Funds understand that the rights and obligations of any Fund under the Trust Document or other organizational document are separate and distinct from those of any and all other series of the Trust.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
PACIFIC SELECT FUND, on behalf of itself and each of the Acquiring Funds listed on Schedule A, Severally and Not Jointly
By: /s/Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Senior Vice President
FIDELITY SALEM STREET TRUST, on behalf of itself and each of its Acquired Funds, Severally and Not Jointly
By: /s/Xxxxxx Xxxxx
Name: Xxxxxx Xxxxx
Title: Officer
SCHEDULE A
Acquiring Trusts and Acquiring Funds
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Acquiring Trust |
Acquiring Funds |
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ESG Diversified Portfolio | |
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ESG Diversified Growth Portfolio |
SCHEDULE B
Acquired Trusts and Acquired Funds
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Acquired Trust |
Acquired Funds |
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Fidelity Salem Street Trust |
Fidelity U.S. Sustainability Index Fund Fidelity International Sustainability Index Fund |
SCHEDULE C
Acquired Fund Investment Protocols
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(A) |
(B) |
(C) |
(D) |
(E) |
(F) |
(G) |
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Fidelity U.S. Sustainability Index Fund |
None |
25% |
Yes- |
Yes- |
Y |
2,500,000 |
2,500,000 |
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Fidelity International Sustainability Index Fund |
None |
25% |
Yes- |
Yes- |
Y |
600,000 |
600,000 |
