EXHIBIT 99.(e)
DISTRIBUTION AGREEMENT
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AGREEMENT made this _____ day of __________________, 1999, between HSBC
MUTUAL FUNDS TRUST (the "Trust"), a Massachusetts business trust having its
principal place of business at 0000 Xxxxxxx Xx, Xxxxxxxx, Xxxx 00000,
and BISYS FUND SERVICES LIMITED PARTNERSHIP d/b/a BISYS FUND SERVICES
("Distributor"), having its principal place of business at 0000 Xxxxxxx Xxxx,
Xxxxxxxx, Xxxx 00000.
WHEREAS, the Trust is an open-end management investment company, organized
as a Massachusetts business trust and registered with the Securities and
Exchange Commission (the "Commission") under the Investment Company Act of 1940,
as amended (the "1940 Act"); and
WHEREAS, it is intended that Distributor act as the distributor of the
units of beneficial interest ("Shares") of each of the investment portfolios of
the Trust (such portfolios being referred to individually as a "Fund" and
collectively as the "Funds").
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein set forth, the parties agree as follows:
1. Services as Distributor.
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1.1 Distributor will act as agent for the distribution of the Shares
covered by the registration statement and prospectus of the Trust then in effect
under the Securities Act of 1933, as amended (the "Securities Act"). As used in
this Agreement, the term "registration statement" shall mean Parts A (the
prospectus), B (the Statement of Additional Information) and C of each
registration statement that is filed on Form N-1A, or any successor thereto,
with the Commission, together with any amendments thereto. The term
"prospectus" shall mean each form of prospectus and Statement of Additional
Information used by the Funds for delivery to shareholders and prospective
shareholders after the effective dates of the above referenced registration
statements, together with any amendments and supplements thereto.
1.2 Distributor agrees to use appropriate efforts to solicit orders
for the sale of the Shares and will undertake such advertising and promotion as
it believes reasonable in connection with such solicitation. The Trust
understands that Distributor is now and may in the future be the distributor of
the shares of several investment companies or series (together, "Companies")
including Companies having investment objectives similar to those of the Trust.
The Trust further understands that investors and potential investors in the
Trust may invest in shares of such other Companies. The Trust agrees that
Distributor's duties to such Companies shall not be deemed in conflict with its
duties to the Trust under this paragraph 1.2.
Distributor shall, at its own expense, finance appropriate
activities which it deems reasonable, which are primarily intended to result in
the sale of the Shares, including, but not limited to, advertising, compensation
of underwriters, dealers and sales personnel, the printing and mailing of
prospectuses to other than current Shareholders, and the printing and mailing of
sales literature.
1.3 In its capacity as distributor of the Shares, all activities of
Distributor and its partners, agents, and employees shall comply with all
applicable laws, rules and regulations, including, without limitation, the 1940
Act, all rules and regulations promulgated by the Commission thereunder and all
rules and regulations adopted by any securities association registered under the
Securities Exchange Act of 1934.
1.4 Distributor will provide one or more persons, during normal
business hours, to respond to telephone questions with respect to the Trust.
1.5 Distributor will transmit any orders received by it for purchase
or redemption of the Shares to the transfer agent and custodian for the Funds.
1.6 Whenever in their judgment such action is warranted by unusual
market, economic or political conditions, or by abnormal circumstances of any
kind, the Trust's officers may decline to accept any orders for, or make any
sales of, the Shares until such time as those officers deem it advisable to
accept such orders and to make such sales.
1.7 Distributor will act only on its own behalf as principal if it
chooses to enter into selling agreements with selected dealers or others.
1.8 The Trust agrees at its own expense to execute any and all
documents and to furnish any and all information and otherwise to take all
actions that may be reasonably necessary in connection with the qualification of
the Shares for sale in such states as Distributor may designate.
1.9 The Trust shall furnish from time to time, for use in connection
with the sale of the Shares, such information with respect to the Funds and the
Shares as Distributor may reasonably request; and the Trust warrants that the
statements contained in any such information shall fairly show or represent what
they purport to show or represent. The Trust shall also furnish Distributor
upon request with: (a) unaudited semi-annual statements of the Funds' books and
accounts prepared by the Trust, (b) a monthly itemized list of the securities in
the Funds, (c) monthly balance sheets as soon as practicable after the end of
each month, and (d) from time to time such additional information regarding the
financial condition of the Funds as Distributor may reasonably request.
1.10 The Trust represents to Distributor that, with respect to the
Shares, all registration statements and prospectuses filed by the Trust with the
Commission under the Securities Act have been carefully prepared in conformity
with requirements of said Act and rules and regulations of the Commission
thereunder. The registration statement and prospectus contain all statements
required to be stated therein in conformity with said Act and the rules and
regulations of said Commission and all statements of fact contained in any such
registration statement and prospectus are true and correct. Furthermore,
neither any registration statement nor any prospectus includes an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not misleading to a
purchaser of the Shares. The Trust may, but shall not be obligated to, propose
from time to time such amendment or amendments to any registration statement and
such supplement or supplements to any prospectus as, in the light of future
developments, may, in the opinion of the Trust's counsel, be necessary or
advisable. If the Trust shall not propose such amendment or amendments and/or
supplement or supplements within fifteen days after receipt by the Trust of a
written request from Distributor to do so, Distributor may, at its option,
terminate this Agreement. The Trust shall not file any amendment to any
registration statement or supplement to any prospectus without giving
Distributor reasonable notice thereof in advance; provided, however, that
nothing contained in this Agreement shall in any way limit the Trust's right to
file at any time such amendments to any registration statement and/or
supplements to any prospectus, of whatever character, as the Trust may deem
advisable, such right being in all respects absolute and unconditional.
1.11 The Trust authorizes Distributor and dealers to use any
prospectus in the form furnished from time to time in connection with the sale
of the Shares. The Trust shall indemnify, defend and hold harmless Distributor,
its partners and employees and any person who controls Distributor within the
meaning of the Securities Act, from and against any and all claims, demands,
liabilities and expenses (including the cost of investigating or defending such
claims, demands or liabilities and any reasonable counsel fees incurred in
connection therewith) which Distributor, its partners and employees or any such
controlling person, may incur under the Securities Act, the 1940 Act, the common
law or otherwise arising out of or based upon any alleged untrue statement of a
material fact contained in the registration statement or any prospectus or
arising out of or based upon any alleged omission by the Trust to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, unless such statement or omission was made in reliance
upon, and in conformity with, information furnished in writing to the Trust by
or on behalf of Distributor for use in the preparation of the registration
statement or the prospectuses. Notwithstanding the foregoing, this indemnity
agreement, to the extent that it might require indemnity of any person who is a
partner or employee of Distributor and who is also a Trustee of the Trust, shall
not inure to the benefit of such partner or employee unless a court of competent
jurisdiction shall determine, or it shall have been determined by controlling
precedent, that such result would not be against public policy as expressed in
the Securities Act or the 1940 Act. This Agreement shall not be construed to
protect Distributor against any liability to the Trust or its shareholders to
which Distributor would otherwise be subject by reason
of willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of it obligations and duties under
this Agreement. This indemnity agreement shall not inure to the benefit of
Distributor, its partners or employees or any controlling person as aforesaid if
any untrue statement or omission made in any prospectus delivered to a purchaser
of shares is corrected in any amendment or supplement to such prospectus and
such amended or supplemented prospectus shall not have been delivered or sent to
such purchaser within the time required by the Securities Act and the rules
promulgated thereunder, provided that the Trust has delivered such amended or
supplemented prospectus to Distributor in requisite quantity on a timely basis
to permit such delivery or sending. This indemnity agreement is expressly
conditioned upon the Trust's being notified of any action brought against
Distributor, its partners or employees or any such controlling person, which
notification shall be given by letter or by telegram addressed to the Trust at
its principal office in New York, New York and sent to the Trust by the person
against whom such action is brought within 10 days after the summons or other
first legal process shall have been served. The failure to notify the Trust of
any such action shall not relieve the Trust from any liability which it may have
to the person against whom such action is brought by reason of any such alleged
untrue statement or omission otherwise than on account of the indemnity
agreement contained in this paragraph. The Trust shall be entitled to assume the
defense of any suit brought to enforce any such claims, demand or liability,
but, in such case, the defense shall be conducted by counsel chosen by the Trust
and reasonably approved by Distributor. If the Trust elects to assume the
defense of any such suit and retain counsel approved by Distributor,
Distributor, its partners and employees and controlling persons named as the
defendant, or defendants in such suit shall bear the fees and expenses of any
additional counsel retained by any of them, but in case the Trust does not elect
to assume the defense of any such suit, or in case Distributor does not approve
of counsel chosen by the Trust, the Trust will reimburse such person or persons
named as defendant or defendants in such suit, for the reasonable fees and
expenses of any counsel retained by Distributor or such other persons. In
addition, Distributor shall have the right to employ counsel to represent it,
its partners and employees and any such controlling person who may be subject to
liability arising out of any claim in respect of which indemnity may be sought
by Distributor against the Trust hereunder if any such indemnified party shall
have been advised by its counsel that representation of such indemnified party
and the Trust by the same counsel would be inapprpriate under applicable
standards of professional conduct due to actual or potential differing interests
between them, in which event the reasonable fees and expenses of such separate
counsel shall be borne by the Trust. Notwithstanding the preceding two
sentences, the Trust shall, in connection with any such suit and any separate
but substantially similar or related suits, actions or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for all persons
entitled to indemnity under this paragraph. The Trust shall not be liable to
indemnify any person for any settlement of any suit or claim effected without
the Trust's written consent. This indemnity agreement 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 Distributor, its partners and
employees or any such controlling person. This indemnity agreement shall inure
exclusively to the benefit of Distributor, its partners and employees and any
such controlling persons and their respective successors and estates. The Trust
shall promptly notify Distributor of the commencement of any litigation or
proceedings against it in connection with the issue and sale of any Shares.
1.12 Distributor agrees to indemnify, defend and hold harmless the Trust,
its officers and Trustees and any person who controls the Trust within the
meaning of the Securities Act, from and against any and all claims, demands,
liabilities and expenses (including the cost of investigating or defending such
claims, demands or liabilities and any reasonable counsel fees incurred in
connection therewith) which the Trust, its officers or Trustees or any such
controlling person may incur under the Securities Act, the 1940 Act, the common
law or otherwise, but only to the extent that such liability or expense incurred
by the Trust, its officers or Trustees or such controlling person results from
such claims or demands as shall arise out of or be based upon (a) any alleged
untrue statement of a material fact contained in information furnished in
writing by Distributor to the Trust specifically for use in the registration
statement or any prospectus or shall arise out of or be based upon any alleged
omission to state a material fact required to be stated therein or necessary to
make such statement therein not misleading and (b) any alleged act or omission
on Distributor's part as the Trust's agent that has not been expressly
authorized by the Trust in writing. This indemnity agreement is expressly
conditioned upon Distributor's being notified of any action brought against the
Trust, its officers or Trustees or any such controlling person, which
notification shall be given by letter or telegram addressed to Distributor at
its principal office in Columbus, Ohio, and sent to Distributor by the person
against whom such action is brought, within 10 days after the summons or other
first legal process shall have been served. The failure to notify Distributor of
any such action shall not relieve Distributor from any liability which it may
have to the Trust, its officers or Trustees or such controlling person by reason
of any such alleged misstatement, act or omission on Distributor's part
otherwise than on account of the indemnity agreement contained in this
paragraph. Distributor shall have a right to control the defense of such action
with counsel of its own choosing and reasonably approved by the Trust if such
action is based solely upon such alleged misstatement, act or omission on
Distributor's part, in which event (except as stated below) the Trust, its
officers and Trustees or such controlling person shall each have the right to
participate in the preparation of the defense of such action at their own
expense. If the Trust does not approve of counsel chosen by Distributor, and
therefore Distributor does not control the defense of such action, Distributor
will reimburse the Trust, its officers and Trustees and controlling person named
as defendant or defendants in such action, for the reasonable fees and expenses
of any counsel retained by the Trust or such other persons. In addition, the
Trust shall have the right to employ counsel to represent it, its officers and
Trustees and any such controlling person who may be the subject of liability
arising out of any claim in respect of which indemnity may be sought by the
Trust or any such other person against Distributor hereunder if any such
indemnified party shall have been advised by its counsel that representation of
such indemnified party
and Distributor by the same counsel would be inappropriate under applicable
standards of professional conduct due to actual or potential differing interests
between them, in which event the reasonable fees and expenses of such separate
counsel shall be borne by Distributor. Notwithstanding the preceding two
sentences, Distributor shall, in connection with any such action and any
separate but substantially similar or related suits, actions or proceedings in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
all persons entitled to indemnity under this paragraph. This indemnity agreement
and 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, its officers and Trustees or any such controlling
person. This indemnity agreement shall inure exclusively to the benefit of the
Trust, its officers and Trustees and any such controlling persons and their
respective successors and estates. Distributor shall promptly notify the Trust
of the commencement of any litigation or proceedings against it in connection
with the issue and sale of any shares.
1.13 No Shares shall be offered by either Distributor or the Trust
under any of the provisions of this Agreement and no orders for the purchase or
sale of 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
Securities Act or if and so long as a current prospectus as required by Section
10(b)(2) of said Act is not on file with the Commission; provided, however, that
nothing contained in this paragraph 1.13 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 Trust's prospectus,
Agreement and Declaration of Trust, or Bylaws.
1.14 The Trust agrees to advise Distributor as soon as reasonably
practical by a notice in writing delivered to Distributor or its counsel:
(a) of any request by the Commission for amendments to the
registration statement or prospectus then in effect or for
additional information;
(b) in the event of the issuance by the Commission of any stop
order suspending the effectiveness of the registration
statement or prospectus then in effect or the initiation by
service of process on the Trust of any proceeding for that
purpose;
(c) of the happening of any event that makes untrue any
statement of a material fact made in the registration
statement or prospectus then in effect or which requires the
making of a change in such registration statement or
prospectus in order to make the statements therein not
misleading; and
(d) of all action of the Commission with respect to any
amendment to any registration statement or prospectus
which may from time to time be filed with the
Commission.
For purposes of this section, informal requests by or acts
of the Staff of the Commission shall not be deemed actions of or requests by the
Commission.
1.15 Distributor agrees on behalf of itself and its partners and
employees to treat confidentially and as proprietary information of the Trust
all records and other information relative to the Trust and its prior, present
or potential Shareholders, and not to use such records and information for any
purpose other than performance of its responsibilities and duties hereunder,
except, after prior notification to and approval in writing by the Trust, which
approval shall not be unreasonably withheld and may not be withheld where
Distributor may be exposed to civil or criminal contempt proceedings for failure
to comply, when requested to divulge such information by duly constituted
authorities, or when so requested by the Trust.
1.16 This Agreement shall be governed by the laws of the Commonwealth
of Massachusetts.
2. Appointment of Agent.
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Distributor may enter into a written agreement with another party
qualified to perform distribution services to carry out some or all of its
responsibilities under this Agreement, provided, however, that the Trust agrees
in writing to the retention of the party chosen and the written agreement
related thereto; and provided further, that the party chosen shall be the agent
of Distributor and not the agent of the Trust, and that Distributor shall be
fully responsible for the acts of such party and shall not be relieved of any of
its responsibilities hereunder.
3. Fee.
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Distributor shall receive from the Funds identified in the Rule 12b-1
Distribution Plans attached as Schedule A hereto (the "Distribution Plan Funds")
a distribution fee at the rate and upon the terms and conditions set forth in
such Plan. The distribution fee shall be accrued daily and shall be paid on the
first business day of each month, or at such time(s) as the Distributor shall
reasonably request.
4. Public Offering Price.
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The public offering price of Shares shall be the net asset value of
such Shares. The net asset value of Shares shall be determined in accordance
with the provisions of the Agreement and Declaration of Trust and Bylaws of the
Trust and the then-current prospectus for each Fund.
5. Issuance of Shares.
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The Trust reserves the right to issue, transfer or sell Load Shares at
net asset value (a) in connection with the merger or consolidation of the Trust
or the Load Fund(s) with any other investment company or the acquisition by the
Trust or the Load Fund(s) of all or substantially all of the assets or of the
outstanding shares of any other
investment company; (b) in connection with a pro rata distribution directly to
the holders of Shares in the nature of a stock dividend or split; (c) upon the
exercise of subscription rights granted to the holders of Shares on a pro rata
basis; (d) in connection with the issuance of Load Shares pursuant to any
exchange and reinvestment privileges described in any then-current prospectus of
the Load Fund; and (e) otherwise in accordance with any then-current prospectus
of the Load Fund.
6. Term, Duration and Termination.
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This Agreement shall become effective with respect to each Fund as of
the date first written above and, unless sooner terminated as provided herein,
shall continue with respect to a particular Fund automatically for successive
one-year terms, provided that such continuance is specifically approved at least
annually by (a) by the vote of a majority of those members of the Trust's Board
of Trustees who are not parties to this Agreement or interested persons of any
such party, cast in person at a meeting for the purpose of voting on such
approval and (b) by the vote of the Trust's Board of Trustees or the vote of a
majority of the outstanding voting securities of such Fund. This Agreement is
terminable without penalty, on not less than sixty days' prior written notice,
by the Trust's Board of Trustees, by vote of a majority of the outstanding
voting securities of the Trust or by the Distributor. This Agreement will also
terminate automatically in the event of its assignment. (As used in this
Agreement, the terms "majority of the outstanding voting securities,"
"interested persons" and "assignment" shall have the same meanings as ascribed
to such terms in the 1940 Act.)
7. Limitation of Liability of the Trustees and Shareholders.
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It is expressly agreed that the obligations of the Trust hereunder
shall not be binding upon any of the Trustees, shareholders, nominees, officers,
agents or employees of the Trust personally, but shall bind only the trust
property of the Trust. The execution and delivery of this Agreement have been
authorized by the Trustees, and this Agreement has been signed and delivered by
an authorized officer of the Trust, acting as such, and neither such
authorization by the Trustees nor such execution and delivery by such officer
shall be deemed to have been made by any of them individually or to impose any
liability on any of them personally, but shall bind only the trust property of
the Trust as provided in the Trust's Agreement and Declaration of Trust.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first written
above.
HSBC MUTUAL FUNDS TRUST BISYS FUND SERVICES
LIMITED PARTNERSHIP
By: BISYS Fund Services, Inc.,
General Partner
By: ________________________ By:_____________________
Title: _____________________ Title: _______________________
Date: ______________________ Date: _______________________
Dated: _______________________
SCHEDULE A
TO THE DISTRIBUTION AGREEMENT
BETWEEN
HSBC MUTUAL FUNDS TRUST
AND
BISYS FUND SERVICES LIMITED PARTNERSHIP
DISTRIBUTION AND SHAREHOLDER SERVICE PLAN
