Exhibit h(vii) under Form N-1A
Exhibit 10 under Item 601/Reg.S-K
THIRD PARTY FEEDER FUND AGREEMENT
AMONG
Federated Investment management Company,
Federated Securities Corp.,
Federated Index Trust,
Federated Large Cap Index Fund,
Equity 500 Index Portfolio
AND
Deutsche Asset Management, iNC.
dated as of February 22, 2002
-3-
THIRD PARTY FEEDER FUND AGREEMENT
The parties to this Agreement are Federated Index Trust, a Massachusetts
business trust (the "Company"), in respect of the Federated Large Cap Index
Fund, a series thereof (the "Fund"), Federated Investment Management Company,
a Delaware business trust ("FIMCO"), Federated Securities Corp., a
Pennsylvania corporation ("FSC"), Equity 500 Index Portfolio, a New York
business trust (the "Portfolio"), and Deutsche Asset Management, Inc., a
Delaware corporation ("XxXX, Inc."), with respect to the proposed investment
by the Fund in the Portfolio. THIS AGREEMENT is made and entered into as of
February 22, 2002.
PREAMBLE
WHEREAS, the Company and the Portfolio are each open-end management
investment companies and the Fund and the Portfolio have the same investment
objectives;
WHEREAS, XxXX, Inc. currently serves as the investment adviser of the
Portfolio;
WHEREAS, FSC currently serves as the principal underwriter of the
Company and the Fund;
WHEREAS, FIMCO serves as the supervisor and administrator of the Fund;
WHEREAS, the Company desires to invest all of the Fund's investable
assets in the Portfolio in exchange for a beneficial interest in the
Portfolio (the "Investment") on the terms and conditions set forth in this
Agreement; and
WHEREAS, the Portfolio believes that accepting the Investment is in the
best interests of the Portfolio and that the interests of existing investors
in the Portfolio will not be diluted as a result of its accepting the
Investment;
NOW, THEREFORE, in consideration of the foregoing, the mutual promises
herein made and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
ARTICLE ONE
THE INVESTMENT
1.1 Agreement to Effect the Investment. The Company agrees to assign,
transfer and deliver all of the Fund's investable assets (the "Assets")
to the Portfolio at each Closing (as hereinafter defined). The Portfolio
agrees in exchange therefore to issue to the Fund a beneficial interest
(the "Interest") in the Portfolio equal in value to the net asset value
of the Assets of the Fund conveyed to the Portfolio on that date of
Closing.
ARTICLE TWO
CLOSING AND CLOSING DATE
2.1 Time of Closing. The conveyance of the Assets in exchange for the
Interest, as described in Article One, together with related acts
necessary to consummate such transactions, shall occur initially on the
date the Company commences its offering of shares of the Fund to the
public and at each subsequent date as the Company desires to make a
further Investment in the Portfolio (each, a "Closing"). All acts
occurring at any Closing shall be deemed to occur simultaneously as of
the last daily determination of the Portfolio's net asset value on the
date of Closing.
2.2 Related Closing Matters. On each date of Closing, the Company, on behalf
of the Fund, shall authorize the Fund's custodian to deliver all of the
Assets held by such custodian to the Portfolio's custodian. The Fund's
and the Portfolio's custodians shall each acknowledge, in a form
acceptable to the other party, their respective delivery and acceptance
of the Assets. The Portfolio shall deliver to the Company acceptable
evidence of the Fund's ownership of the Interest. In addition, each
party shall deliver to each other party such bills of sale, checks,
assignments, securities instruments, receipts or other documents as such
other party or its counsel may reasonably request. Each of the
representations and warranties set forth in Article Three shall be
deemed to have been made anew on each date of Closing.
ARTICLE THREE
REPRESENTATIONS AND WARRANTIES
3.1 The Company and FIMCO
The Company and FIMCO each represents and warrants to the Portfolio and
XxXX, Inc. that:
(a) Organization. The Company is a business trust duly
organized, validly existing and in good standing under the laws
of the Commonwealth of Massachusetts. The Fund is a duly and
validly designated series of the Company. The Company and the
Fund have the requisite power and authority to own their property
and conduct their business as now being conducted and as proposed
to be conducted pursuant to this Agreement.
(b) Authorization of Agreement. The execution and delivery of
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this Agreement by the Company and the consummation of the
transactions contemplated hereby have been duly authorized by all
necessary action on the part of the Company by its Board of
Trustees and no other action or proceeding is necessary for the
execution and delivery of this Agreement by the Company, the
performance by the Company of its obligations hereunder and the
consummation by the Company of the transactions contemplated
hereby. This Agreement has been duly executed and delivered by
the Company and constitutes a legal, valid and binding obligation
of the Company in respect of the Fund, enforceable against them
in accordance with its terms.
(c) Authorization of Investment. The Investment has been duly
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authorized by all necessary action on the part of the Board of
Trustees of the Company.
(d) No Bankruptcy Proceedings. Neither the Company nor the Fund
is under the jurisdiction of a court in a proceeding under Title
11 of the United States Code (the "Bankruptcy Code") or similar
case within the meaning of Section 368(a) (3) (A) of the
Bankruptcy Code.
(e) Fund Assets. At the initial Closing, the Fund's Assets will
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consist solely of cash.
(f) Fiscal Year. The fiscal year end for the Fund is December
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31.
(g) Auditors. The Company has appointed independent public
accountants to certify the Fund's financial statements in
accordance with Section 32 of the Investment Company Act of 1940,
as amended (the "1940 Act").
(h) Registration Statement. They have reviewed the Portfolio's
registration statement on Form N-1A, as filed with the Securities
and Exchange Commission ("SEC"), and understand and agree to the
Portfolio's policies and methods of operation as described
therein.
(i) SEC Filings. To the best of their knowledge, the Company
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has duly filed those documents required to be filed under the
Securities Act of 1933, as amended (the "1933 Act"), the
Securities Exchange Act of 1934 (the "1934 Act") and the 1940 Act
(collectively, the "Securities Laws") in connection with the
registration of shares, any meetings of shareholders and
registration as an investment company (the "SEC Filings");.and
the SEC Filings were prepared in accordance with the requirements
of the Securities Laws, as applicable, and the rules and
regulations of the SEC thereunder and do not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading.
(j) 1940 Act Registration. The Company is duly registered as an
open-end management investment company under the 1940 Act and the
Fund and its shares are registered or qualified in any states
where such registration or qualification is necessary and such
registrations or qualifications are in full force and effect.
(k) Purchases and Redemptions. All purchases and redemptions of
Fund shares contemplated by this Agreement shall be effected in
accordance with the Fund's then-current prospectus.
3.2 The Portfolio and XxXX, Inc.
The Portfolio and XxXX, Inc. each represents and warrants to the
Company, FSC and FIMCO that:
(a) Organization. The Portfolio is a business trust duly
organized, validly existing and in good standing under the laws
of the State of New York. The Portfolio has the requisite power
and authority to own its property and conduct its business as now
being conducted and as proposed to be conducted pursuant to this
Agreement.
(b) Authorization of Agreement. The execution and delivery of
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this Agreement by the Portfolio and the consummation of the
transactions contemplated hereby have been duly authorized by all
necessary action on the part of the Portfolio by its Board of
Trustees and no other action or proceeding is necessary for the
execution and delivery of this Agreement by the Portfolio, the
performance by the Portfolio of its obligations hereunder and the
consummation by the Portfolio of the transactions contemplated
hereby. This Agreement has been duly executed and delivered by
the Portfolio and constitutes a legal, valid and binding
obligation of the Portfolio, enforceable against it in accordance
with its terms.
(c) Authorization of Issuance of Interest. The issuance by the
Portfolio of the Interest in exchange for the Investment by the
Fund of its Assets has been duly authorized by all necessary
action on the part of the Board of Trustees of the Portfolio.
When issued in accordance with the terms of this Agreement, the
Interest will be validly issued, fully paid and non-assessable by
the Portfolio.
(d) No Bankruptcy Proceedings. The Portfolio is not under the
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jurisdiction of a court in a proceeding under Title 11 of the
Bankruptcy Code or similar case within the meaning of Section
368(a)(3)(A) of the Bankruptcy Code.
(e) Fiscal Year. The fiscal year end of the Portfolio is
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December 31.
(f) Auditors. The Portfolio has appointed independent public
accountants to certify the Portfolio's financial statements in
accordance with Section 32 of the 1940 Act.
(g) Registration Statement. They have reviewed the Company's
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registration statement on Form N-1A, as filed with the SEC, and
understand and agree to the Fund's policies and methods of
operation as described therein.
(h) SEC Filings; State Filings. To the best of their knowledge,
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the Portfolio has duly filed the SEC Filings; and the SEC Filings
were prepared in accordance with the requirements of the
Securities Laws, as applicable, and the rules and regulations of
the SEC thereunder, and do not contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading. The Portfolio has advised the Company that
beneficial interests in the Portfolio are not required to be
registered under the 1933 Act because such interests are offered
solely in private placement transactions that do not involve any
"public offering" within the meaning of Section 4(2) of the 1933
Act, and such beneficial interests are not required to be
registered or qualified in any state.
(i) 1940 Act Registration. The Portfolio is duly registered as
an open-end management investment company under the 1940 Act and
such registration is in full force and effect.
(j) Tax Status. The Portfolio is taxable as a partnership under
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the Internal Revenue Code of 1986, as amended (the "Code").
3.3 XxXX, Inc.
XxXX, Inc. represents and warrants to the Company and FIMCO that:
(a) Organization. XxXX, Inc. is a corporation duly organized,
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validly existing and in good standing under the laws of the State
of Delaware and has the requisite power and authority to conduct
its business as now being conducted.
(b) Authorization of Agreement. The execution and delivery of this
------------------------------
Agreement by XxXX, Inc. has been duly authorized by all necessary
action on the part of XxXX, Inc. and no other action or
proceeding is necessary for the execution and delivery of this
Agreement by XxXX, Inc.. This Agreement has been duly executed
and delivered by XxXX, Inc. and constitutes a legal, valid and
binding obligation of XxXX, Inc.
(c) Investment Adviser. XxXX, Inc. is the Portfolio's
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investment adviser and is duly registered as such under the
Investment Advisers Act of 1940, as amended (the "Advisers Act").
XxXX, Inc. will comply with all applicable provisions of the
Advisers Act.
3.4 FIMCO and FSC
(a) FIMCO represents and warrants to the Portfolio and XxXX,
Inc. that:
(i) Organization. FIMCO is a Delaware business trust duly
organized, validly existing and in good standing under the
laws of the State of Delaware and has the requisite power and
authority to conduct its business as now being conducted.
(ii) Authorization of Agreement. The execution and delivery of
this Agreement by FIMCO have been duly authorized by all
necessary action on the part of FIMCO and no other action or
proceeding is necessary for the execution and delivery of
this Agreement by FIMCO. This Agreement has been duly
executed and delivered by FIMCO and constitutes a legal,
valid and binding obligation of FIMCO.
(iii) Supervisor and Administrator. FIMCO is the Fund's
supervisor and administrator. FIMCO is duly registered under
the Advisers Act and will comply with all applicable
provisions thereof.
(b) FSC represents and warrants to the Portfolio and XxXX, Inc.
that:
(i) Organization. FSC is a corporation duly organized, validly
existing and in good standing under the laws of the
Commonwealth of Pennsylvania, and has requisite authority to
conduct its business as now being conducted.
(ii) Authorization of Agreement. The execution and delivery of
this Agreement by FSC has been duly authorized by all
necessary action on the part of FSC and no other action or
proceeding is necessary for the execution and delivery of
this Agreement. This Agreement has been duly executed and
delivered by FSC and constitutes a legal, valid and binding
obligation of FSC.
(iii) Underwriter. FSC serves as the Company's and the Fund's
principal underwriter and is duly registered as a
broker-dealer under the 1934 Act.
ARTICLE FOUR
COVENANTS
4.1 The Company
The Company covenants that:
(a) Advance Review of Certain Documents. The Company will
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furnish the Portfolio and XxXX, Inc. at least 10 business days
prior to filing or first use, as the case may be, with drafts of
its registration statement on Form N-lA (including amendments)
and prospectus supplements or amendments relating to the Fund.
The Company will furnish the Portfolio and XxXX, Inc. with any
proposed advertising or sales literature to the Fund at least 10
business days prior to filing or first use. The Company and its
agents will not make any representations concerning XxXX, Inc. or
the Portfolio except those contained in the then-current
registration statement of the Fund or Portfolio, materials
created by FSC and approved by XxXX, Inc. or the Portfolio prior
to use, or advertising or sales materials provided by or on
behalf of XxXX, Inc. or the Portfolio. The Portfolio and XxXX,
Inc. will, however, in no way be liable for any errors or
omissions in such documents, whether or not they make any
objection thereto, except to the extent such errors or omissions
result from information provided by XxXX, Inc. or the Portfolio.
(b) Tax Status. The Fund will qualify for treatment as a
regulated investment company under Subchapter M of the Code for
all periods during which this Agreement is in effect, except to
the extent a failure to so qualify may result from any action or
omission of the Portfolio.
(c) Investment Securities. The Fund will own no investment
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security other than its Interest in the Portfolio.
(d) Proxy Voting. If requested to vote as a shareholder on
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matters pertaining to the Portfolio (other than a vote by the
Company to continue the operation of the Portfolio upon the
withdrawal of another investor in the Portfolio), the Company
will, to the extent required by applicable law, (i) call a
meeting of shareholders of the Fund for the purpose of seeking
instructions from shareholders regarding such matters, (ii) vote
the Fund's Interest proportionally as instructed by Fund
shareholders, and (iii) vote the Fund's Interest with respect to
the shares held by Fund shareholders who do not give voting
instructions in the same proportion as the shares of Fund
shareholders who do give voting instructions. The Company will
hold each such meeting of Fund shareholders in accordance with a
timetable reasonably established by the Portfolio. With respect
to proposals solely attributable to and for the benefit of XxXX,
Inc., XxXX, Inc. shall bear the costs and expenses in calling and
holding such meetings, including, but not limited to the cost of
printing and mailing proxy statements and expenses associated
with the solicitation of Fund shareholders.
(e) Insurance. The Company and the Fund are named insureds
under an errors and omissions liability insurance policy that
covers losses for negligent and wrongful acts in the amount of
$150,000,000. At least once each calendar year, the Company shall
review its insurance coverage, and may increase or decrease its
coverage as it deems appropriate. The Company will notify XxXX,
Inc. in the event such coverage is materially decreased.
(f) Auditors. In the event that the Fund's independent public
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accountants differ from those of the Portfolio, the Fund will be
responsible for costs and expenses that the Portfolio's
independent public accountants charge to the Portfolio to provide
information to the Fund's independent public accountants;
provided however, that (i) the Portfolio will not charge the Fund
for that information that is provided at no cost or expense to
other feeder funds investing in the Portfolio that use the same
independent public accountants as the Portfolio; and (ii) if
requests by the Fund's independent public accountants for
information will result in additional costs or expenses to the
Fund, the Portfolio will notify the Fund of the amount of such
costs or expenses before they are incurred.
4.2 Indemnification by FIMCO
(a) With respect to those matters listed in subparagraphs (i)
through (vi) below, FIMCO will indemnify and hold harmless the
Portfolio, XxXX, Inc. and their respective trustees, directors,
officers and employees and each other person who controls the
Portfolio or XxXX, Inc., as the case may be, within the meaning
of Section 15 of the 1933 Act (each, a "Covered Person" and
collectively, "Covered Persons"), against any and all losses,
claims, demands, damages, liabilities and expenses, joint or
several, (each, a "Liability" and collectively, the
"Liabilities"). Unless FIMCO elects to assume the defense
pursuant to paragraph (b) FIMCO will bear the reasonable cost of
investigating and defending against any claims therefor and any
reasonable counsel fees incurred in connection therewith. This
Section 4.2 applies to any Liability which is based upon:
(i) any violation or alleged violation of the Securities Laws,
any other statute or common law or are incurred in connection
with or as a result of any formal or informal administrative
proceeding or investigation by a regulatory agency, insofar
as such Liabilities arise out of or are based upon the ground
or alleged ground that any direct or indirect omission or
commission by the Company or the Fund (either during the
course of its daily activities or in connection with the
accuracy of its representations or its warranties in this
Agreement) caused or continues to cause the Portfolio to
violate any federal or state securities laws or regulations
or any other applicable domestic or foreign law or
regulations or common law duties or obligations, but only to
the extent that such Liabilities do not arise out of and are
not based upon an omission or commission of the Portfolio or
XxXX, Inc.;
(ii) any misstatement of a material fact or an omission of a
material fact in the Fund's registration statement (including
amendments thereto) or included in Fund advertising or sales
literature, other than information provided by or on behalf
of the Portfolio or XxXX, Inc. or included in Fund
advertising or sales literature at the request of the
Portfolio or XxXX, Inc. or the agent of either;
(iii) the failure of any representation or warranty made by the
Company or FIMCO to be materially accurate when made or the
failure of the Company or FIMCO to perform any covenant
contained herein or to otherwise comply with the terms of
this Agreement;
(iv) any unlawful or negligent act of the Company, FIMCO or any
director, officer, employee or agent of the Company or FIMCO,
whether such act was committed against the Company, the
Portfolio, XxXX, Inc. or any third party;
(v) any Liability of the Fund for which the Portfolio is also
liable and for which the Company or FIMCO is responsible;
(b) In no case shall FIMCO be liable with respect to any claim made
against any Covered Person under this Section 4.2 unless the
Covered Person shall have notified FIMCO in writing of the nature
of the claim within a reasonable time after the summons, other
first legal process or formal or informal initiation of a
regulatory investigation or proceeding shall have been served upon
or provided to a Covered Person, or any federal, state or local
tax deficiency has come to the attention of XxXX, Inc., the
Portfolio or a Covered Person. Failure to notify FIMCO of such
claim shall relieve it from Liability only to the extent that it
is actually harmed or disadvantaged by the failure to provide
timely notice and shall not relieve FIMCO from any Liability that
it may have to any Covered Person otherwise than on account of the
indemnification contained in this Section.
(c) FIMCO will 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 Liability. If FIMCO elects to
assume the defense, such defense shall be conducted by counsel
chosen by FIMCO. In the event FIMCO elects to assume the defense
of any such suit and retain such counsel, each Covered Person and
any other defendant or defendants may retain additional counsel,
but shall bear the fees and expenses of such counsel unless (A)
FIMCO shall have specifically authorized the retaining of such
counsel or (B) the parties to such suit include any Covered
Person and FIMCO, and any such Covered Person has been advised by
counsel in writing that one or more legal defenses may be
available to it that may not be available to FIMCO, in which case
FIMCO shall not be entitled to assume the defense of such suit
notwithstanding its obligation to bear the reasonable fees and
expenses of such counsel. FIMCO shall not be liable to indemnify
any Covered Person for any settlement of any claim effected
without FIMCO's written consent, which consent shall not be
unreasonably withheld or delayed. The indemnities set forth in
paragraph (a) will be in addition to any liability that the
Company in respect of the Fund might otherwise have to a Covered
Person.
4.3 Indemnification by FSC
(a) With respect to those matters listed in subparagraph (i)
through (iv) below, FSC will indemnify and hold harmless the
Portfolio, XxXX, Inc. and their respective trustees, directors,
officers and employees and each other person who controls the
Portfolio or XxXX, Inc., as the case may be, within the meaning
of Section 15 of the 1933 Act (each a "Covered Person" and
collectively, "Covered Persons"), against any and all losses,
claims, demands, damages, liabilities and expenses, joint or
several, (each, a "Liability" and collectively, the
"Liabilities"). Unless FSC elects to assume the defense pursuant
to paragraph (c), FSC will bear the reasonable cost of
investigating and defending against any claims therefor and any
reasonable counsel fees incurred in connection therewith. This
Section 4.3 applies to any Liability which is based upon:
(i) the failure of any representation or warranty made by FSC to
be materially accurate when made or the failure of FSC to
perform any covenant contained herein or to otherwise comply
with the terms of this Agreement;
(ii) any unlawful or negligent act of FSC or any director,
officer, employee or agent of FSC, whether such act was
committed against the Company, the Portfolio, XxXX, Inc. or
any third party; or
(b) In no case shall FSC be liable with respect to any claim
made against any Covered Person under this Section 4.3 unless the
Covered Person shall have notified FSC in writing of the nature
of the claim within a reasonable time after the summons, other
first legal process or formal or informal initiation of a
regulatory investigation or proceeding shall have been served
upon or provided to a Covered Person, or any federal, state or
local tax deficiency has come to the attention of XxXX, Inc. the
Portfolio or a Covered Person. Failure to notify FSC of such
claim shall relieve it from Liability only to the extent that it
is actually harmed or disadvantaged by the failure to provide
timely notice and shall not relieve FSC from any Liability that
it may have to any Covered Person otherwise than on account of
the indemnification contained in this Section.
(c) FSC will 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 Liability. If FSC elects to
assume the defense, such defense shall be conducted by counsel
chosen by FSC. In the event FSC elects to assume the defense of
any such suit and retain such counsel, each Covered Person and
any other defendant or defendants may retain additional counsel,
but shall bear the fees and expenses of such counsel unless (i)
FSC shall have specifically authorized the retaining of such
counsel or (ii) the parties to such suit include any Covered
Person and FSC, and any such Covered Person has been advised by
counsel in writing that one or more legal defenses may be
available to it that may not be available to FSC, in which case
FSC shall not be entitled to assume the defense of such suit
notwithstanding its obligation to bear the reasonable fees and
expenses of such counsel. FSC shall not be liable to indemnify
any Covered Person for any settlement of any claim effected
without FSC's written consent. Such consent shall not be
unreasonably withheld or delayed. The indemnities set forth in
paragraph (a) will be in addition to any liability that FSC might
otherwise have to a Covered Person.
4.4 The Portfolio
The Portfolio covenants that:
(a) Advance Review of Certain Documents. The Portfolio will
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furnish the Company and FIMCO, at least 10 business days prior to
filing or first use, as the case may be, with drafts of its
registration statement on Form N-1A (including amendments) and
prospectus supplements or amendments. This advance review period
may be waived with the consent of the Company and FIMCO. The
Portfolio and its agents will not make any representations
concerning FIMCO, FSC, the Company or the Fund except those
contained in the then-current registration statement of the Fund
or Portfolio, materials created by XxXX, Inc. and approved by FSC
prior to use, or advertising or sales material provided by or on
behalf of FSC, the Company or the Fund.
(b) Tax Status. The Portfolio will qualify to be taxable as a
partnership under the Code for all periods during which this
Agreement is in effect, except to the extent that the failure to
so qualify results from any action or omission of the Fund.
(c) Insurance. The Portfolio is a named insured under an errors
and omissions liability insurance policy that covers losses for
negligent and wrongful acts in an amount of $15,000,000. At least
once each calendar year, the Portfolio shall review its insurance
coverage, and may increase or decrease its coverage, as it deems
appropriate. The Portfolio will notify the FIMCO in the event
such coverage is materially decreased.
(d) Availability of Interests. Conditional upon the Company
complying with the terms of this Agreement, the Portfolio shall
permit the Fund to make additional Investments in the Portfolio
on each business day on which shares of the Fund are sold to the
public; provided, however, that the Portfolio may refuse to
permit the Fund to make additional Investments in the Portfolio
on any day on which:
(i) the Portfolio has refused to permit all other investors in
the Portfolio to make additional investments in the
Portfolio, or
(ii) the Trustees of the Portfolio have reasonably determined
that permitting additional investments by the Fund in the
Portfolio would constitute a breach of their fiduciary duties
to the Portfolio.
4.5 Indemnification by XxXX, Inc.
(a) With respect to those matters listed in subparagraphs (i)
through (viii) below, XxXX, Inc. will indemnify and hold harmless
the Company, FIMCO, FSC, their respective directors, officers and
employees and each other person who controls the Company, the
Fund, FIMCO or FSC, as the case may be, within the meaning of
Section 15 of the 1933 Act (each, a "Covered Person" and
collectively, "Covered Persons"), against any and all losses,
claims, demands, damages, liabilities and expenses, joint or
several, (each, a "Liability" and collectively, the
"Liabilities"). Unless XxXX, Inc. elects to assume the defense
pursuant to paragraph (b), XxXX, Inc. will bear the reasonable
costs of investigating and defending against any claims therefore
and any reasonable counsel fees incurred in connection
therewith), whether incurred directly by the Company, FIMCO or
FSC or indirectly by the Company, FIMCO, or FSC through the
Company's Investment in the Portfolio. This Section 4.5 applies
to any Liability which is based upon:
(i) any violation or alleged violation of the Securities Laws,
any other statute or common law or are incurred in connection
with or as a result of any formal or informal administrative
proceeding or investigation by a regulatory agency, insofar
as such Liabilities arise out of or are based upon the ground
or alleged ground that any direct or indirect omission or
commission by the Portfolio (either during the course of its
daily activities or in connection with the accuracy of its
representations or its warranties in this Agreement) caused
or continues to cause the Company to violate any federal or
state securities laws or regulations or any other applicable
domestic or foreign law or regulations or common law duties
or obligations, but only to the extent that such Liabilities
do not arise out of and are not based upon an omission or
commission of the Company, FIMCO or FSC;
(ii) an inaccurate calculation of the Portfolio's net asset
value (whether by the Portfolio, XxXX, Inc. or any party
retained for that purpose);
(iii) (A) any misstatement of a material fact or an
omission of a material fact in the Portfolio's registration
statement (including amendments thereto) or included in
advertising or sales literature used by the Fund, other than
information provided by or on behalf of the Company, FIMCO or
FSC or included at their, or their agent's request, or (B)
any misstatement of a material fact or an omission of a
material fact in the registration statement or advertising or
sales literature of any investor in the Portfolio, other than
the Company;
(iv) the Portfolio's having caused the Fund to fail to qualify
as a regulated investment company under the Code;
(v) failure of any representation or warranty made by the
Portfolio or XxXX, Inc. to be materially accurate when made,
any material breach of any representation or warranty made by
the Portfolio or XxXX, Inc., or the failure of the Portfolio
or XxXX, Inc. to perform any covenant contained herein or to
otherwise comply with the terms of this Agreement;
(vi) any unlawful or negligent act by the Portfolio, XxXX, Inc.
or any director, trustee, officer, employee or agent of the
Portfolio or adviser, whether such act was committed against
the Portfolio, the Company, FIMCO, FSC or any third party;
(vii) any claim that the systems, methodologies, or technology
used in connection with operating the Portfolio, including
the technologies associated with maintaining the
master-feeder structure of the Portfolio, violate any license
or infringe upon any patent or trademark;
(viii) any liability of the Portfolio for which the Fund is also
liable and for which the Portfolio or XxXX, Inc. is
responsible, and any Liability of the Portfolio to any
investor in the Portfolio (or shareholder thereof), other
than the Fund (and its shareholders),
(b) In no case shall XxXX, Inc. be liable with respect to any claim
made against any such Covered Person under this Section 4.5
unless such Covered Person shall have notified XxXX, Inc. in
writing of the nature of the claim within a reasonable time after
the summons, other first legal process or formal or informal
initiation of a regulatory investigation or proceeding shall have
been served upon or provided to a Covered Person or any federal,
state or local tax deficiency has come to the attention of the
Company, FIMCO, FSC or a Covered Person. Failure to notify XxXX,
Inc. of such claim shall relieve it from Liability only to the
extent that it is actually harmed or disadvantaged by the failure
to provide timely notice and shall not relieve XxXX, Inc. from
any Liability that it may have to any Covered Person otherwise
than on account of the indemnification contained in this
paragraph.
(c) XxXX, Inc. will 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 Liability. If XxXX, Inc.
elects to assume the defense, such defense shall be conducted by
counsel chosen by XxXX, Inc. In the event XxXX, Inc. elects to
assume the defense of any such suit and retain such counsel, each
Covered Person and any other defendant or defendants in the suit
may retain additional counsel but shall bear the reasonable fees
and expenses of such counsel unless (i) XxXX, Inc. shall have
specifically authorized the retaining of such counsel or (ii) the
parties to such suit include any Covered Person and XxXX, Inc.,
and any such Covered Person has been advised by counsel, in
writing, that one or more legal defenses may be available to it
that may not be available to XxXX, Inc., in which case XxXX, Inc.
shall not be entitled to assume the defense of such suit
notwithstanding the obligation to bear the fees and expenses of
such counsel. XxXX, Inc. shall not be liable to indemnify any
Covered Person for any settlement of any such claim effected
without XxXX, Inc.'s written consent. Such consent shall not be
unreasonably withheld or delayed. The indemnities set forth in
paragraph (a) will be in addition to any liability that the
Portfolio might otherwise have to a Covered Person.
4.6 Scope of Agreement
Nothing contained herein shall be construed to protect any person
against any liability to which such person would otherwise be subject by
reason of willful misfeasance, bad faith, or negligence, in the performance
of such person's duties, or by reason of such person's reckless disregard of
such person's obligations under such contract or agreement.
4.7 In-Kind Redemption
Withdrawals or redemptions of any Interest in the Portfolio may be
satisfied by means of an "in kind" redemption in compliance with Rule 18f-1
under the 1940 Act. For purposes of determining compliance with Rule 18f-1,
each shareholder of the Fund redeeming shares of the Fund on a particular day
will be treated as a direct holder of an Interest in the Portfolio being
redeemed that day. Any such withdrawal or redemption will mirror, as closely
as practicable, the composition of the Portfolio immediately upon the
redemption.
4.8 Reasonable Actions
Each party covenants that it will, subject to the provisions of this
Agreement, from time to time, as and when requested by another party or in
its own discretion, as the case may be, execute and deliver or cause to be
executed and delivered all such assignments and other instruments, take or
cause to be taken such actions, and do or cause to be done all things
reasonably necessary, proper or advisable in order to consummate the
transactions contemplated by this Agreement and to carry out its intent and
purpose.
ARTICLE FIVE
CONDITIONS PRECEDENT
5.0 General
The obligations of each party to consummate the transactions provided
for herein shall be subject to:
(a) performance by the other parties of all the obligations to
be performed by the other parties hereunder on or before each
Closing,
(b) all representations and warranties of the other parties
contained in this Agreement being true and correct in all
material respects as of the date hereof and, except as they may
be affected by the transactions contemplated by this Agreement,
as of each date of Closing, with the same force and effect as if
made on and as of the time of such Closing, and
(c) the following further conditions that shall be fulfilled on
or before each Closing.
5.1 Regulatory Status
All necessary filings shall have been made with the SEC and state
securities authorities, and no order or directive shall have been received
that any other or further action is required to permit the parties to carry
out the transactions contemplated hereby.
5.3 Investment Objective/Restrictions
The Fund shall have the same investment objective and substantively the
same investment restrictions as the Portfolio.
ARTICLE SIX
ADDITIONAL AGREEMENTS
6.1 Notification of Certain Matters
Each party will give prompt notice to the other parties of:
(a) the occurrence or non-occurrence of any event the
occurrence or non-occurrence of which would be likely to cause
either:
(i) any representation or warranty contained in this Agreement to
be materially untrue or inaccurate, or
(ii) any condition precedent set forth in Article Five hereof to
be unsatisfied in any material respect at the time of any
Closing, and
(b) any material failure of a party to comply with or satisfy
any covenant, condition or agreement to be complied with or
satisfied by such person hereunder; provided, however, that the
delivery of any notice pursuant to this Section 6.1 shall not
limit or otherwise affect the remedies available, hereunder or
otherwise, to the party receiving such notice.
6.2 Access to Information
The Portfolio and the Company shall afford each other reasonable access
at all reasonable times to such party's officers, employees, agents and
offices and to all its relevant books and records and shall furnish each
other party with all relevant financial and other data and information as
requested; provided, however, that nothing contained herein shall obligate
the Company to provide the Portfolio with access to the books and records of
the Company relating to any series of the Company other than the Fund, nor
shall anything contained herein obligate the Company to furnish the Portfolio
with the Fund's shareholder list, except as may be required to comply with
applicable law or any provision of this Agreement.
6.3 Confidentiality
Each party agrees that it shall hold in strict confidence all data and
information obtained from another party (unless such information is or
becomes readily ascertainable from public or published information or trade
sources) and shall ensure that its officers, employees and authorized
representatives do not disclose such information to others without the prior
written consent of the party from whom it was obtained, except if disclosure
is required by the SEC, any other regulatory body or the Fund's or
Portfolio's respective auditors, or in the opinion of counsel such disclosure
is required by law, and then only with as much prior written notice to the
other party as is practical under the circumstances.
6.4 Public Announcements
No party shall issue any press release or otherwise make any public
statements with respect to the matters covered by this Agreement without the
prior consent of the other parties hereto, which consent shall not be
unreasonably withheld; provided, however, that consent shall not be required
if, in the opinion of counsel, such disclosure is required by law, provided
further, however, that the party making such disclosure shall provide the
other parties hereto with as much prior written notice of such disclosure as
is practical under the circumstances. Advance review of sales literature and
advertising material shall be subject to the provisions of Section 4.1 of
this Agreement.
ARTICLE SEVEN
TERMINATION, AMENDMENT AND WAIVER
7.1 Termination
(a) This Agreement may be terminated by the mutual agreement of
all parties.
(b) This Agreement may be terminated at any time by the Company
by withdrawing all of the Fund's Interest in the Portfolio.
(c) This Agreement may be terminated on not less than 90 days'
prior written notice by the Portfolio and XxXX, Inc. to the
Company, the Fund, FSC and FIMCO, or by FIMCO or FSC on not less
than 90 days' prior written notice to the Portfolio and XxXX, Inc.
(d) This Agreement shall terminate automatically with respect
to FIMCO and FSC upon the effective date of termination by the
Company and this Agreement shall terminate automatically with
respect to XxXX, Inc. upon the effective date of termination by
the Portfolio.
(e) This Agreement may be terminated at any time immediately
upon written notice to the other parties in the event that formal
proceedings are instituted against another party to this
Agreement by the SEC or any other regulatory body, provided that
the terminating party has a reasonable belief that the
institution of the proceeding is not without foundation and will
have a material adverse impact on the terminating party.
(f) This Agreement shall terminate automatically with respect
to FSC upon the effective date of the termination of its duties
as principal underwriter by the Company. At such time XxXX, Inc.
shall have the right to immediately terminate this Agreement.
FIMCO and the Company acknowledge that at such time in the event
this Agreement is not terminated, the Agreement will require
amendment to reflect the Company's appointment of a new
distributor.
(g) The indemnification obligations of the parties set forth in
Article Four shall survive the termination of this Agreement with
respect to any Liability relating to actions or omissions prior
to the termination.
7.2 Amendment
This Agreement may be amended, modified or supplemented at any time in
such manner as may be mutually agreed upon in writing by the parties.
7.3 Waiver
At any time prior to any Closing, any party may:
(a) extend the time for the performance of any of the
obligations or other acts of the other parties hereto,
(b) waive any inaccuracies in the representations and
warranties contained herein or in any document delivered pursuant
hereto, and
(c) waive compliance with any of the agreements or conditions
contained herein.
ARTICLE EIGHT
DAMAGES
8.1 Appropriate Relief
The parties agree that, in the event of a breach of this Agreement, the
remedy of money damages would not be adequate and agree that injunctive
relief would be the appropriate relief.
ARTICLE NINE
GENERAL PROVISIONS
9.1 Notices
All notices and other communications given or made pursuant hereto shall
be in writing and shall be deemed to have been duly given or made on the
earlier of (a) when actually received in person or by fax, or (b) three days
after being sent by certified or registered United States mail, return
receipt requested, postage prepaid, addressed as follows:
If to FIMCO, FSC or the Company:
Federated Investors Tower
0000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Attention: General Counsel
If to the Portfolio or XxXX, Inc:
Global Fund Services
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxx
Any party to this Agreement may change the identity or address of the
person to receive notice by providing written notice thereof to all other
parties to the Agreement.
9.2 Expenses
All costs and expenses incurred in connection with this Agreement and
the transactions contemplated hereby shall be paid by the party incurring
such costs and expenses, unless otherwise provided herein.
9.3 Headings
The headings and captions contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation
of this Agreement.
9.4 Severability
If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner adverse to any
party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of
the parties as closely as possible in an acceptable manner to the end that
the transactions contemplated hereby are fulfilled to the extent possible.
9.5 Entire Agreement
This Agreement and the agreements and other documents delivered pursuant
hereto set forth the entire understanding between the parties concerning the
subject matter of this Agreement and incorporate or supersede all prior
negotiations and understandings. There are no covenants, promises,
agreements, conditions or understandings, either oral or written, between
them relating to the subject matter of this Agreement other than those set
forth herein. No representation or warranty has been made by or on behalf of
any party to this Agreement (or any officer, director, trustee, employee or
agent thereof) to induce any other party to enter into this Agreement or to
abide by or consummate any transactions contemplated by any terms of this
Agreement, except representations and warranties expressly set forth herein.
9.6 Successors and Assignments
Each and all of the provisions of this Agreement shall be binding upon
and inure to the benefit of the parties hereto and, except as otherwise
specifically provided in this Agreement, their respective successors and
assigns. Notwithstanding the foregoing, no party shall make any assignment of
this Agreement or any rights or obligations hereunder without the written
consent of all other parties. As used herein, the term "assignment" shall
have the meaning ascribed thereto in the 1940 Act.
9.7 Governing Law
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York without giving effect to the choice of law or
conflicts of law provisions thereof.
9.8 Counterparts
This Agreement may be executed in any number of counterparts, all of
which shall constitute one and the same instrument, and any party hereto may
execute this Agreement by signing one or more counterparts.
9.9 Third Parties
Nothing herein expressed or implied is intended or shall be construed to
confer upon or give any person, other than the parties hereto and their
successors or assigns, any rights or remedies under or by reason of this
Agreement.
9.10 Interpretation
Any uncertainty or ambiguity existing herein shall not presumptively be
interpreted against any party, but shall be interpreted according to the
application of the rules of interpretation for arm's-length agreements.
9.11 Limitation of Liability
The parties hereby acknowledge that the Company has entered into this
Agreement solely on behalf of the Fund and that no other series of the
Company shall have any obligation hereunder with respect to any liability of
the Company arising hereunder.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers, thereunto duly authorized, as of the
date first written above.
Federated Investment Management Company
By:
------------------------
Name:
------------------------
Title:
------------------------
Federated Securities Corp.
By:
------------------------
Name:
------------------------
Title:
------------------------
Federated Index Trust on behalf of itself and the Large Cap Index Fund, a
series thereof
By:
------------------------
Name:
------------------------
Title:
------------------------
Equity 500 Index Portfolio
By:
------------------------
Name: Xxxxxx X. Xxxxxx
Title: Secretary
Deutsche Asset Management, Inc.
By:
------------------------
Name:
------------------------
Title:
------------------------
