DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT (the "Agreement") is made as of the 17th day of
November 2000 by and among The Rockland Funds Trust (the "Fund"), a Delaware
business trust, Greenville Capital Management (the "Adviser"), a Delaware
corporation, and Unified Financial Securities, Inc. (the "Distributor"), an
Indiana corporation.
WITNESSETH THAT:
WHEREAS, the Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act")
and has registered its shares of common stock (the "Shares") under the
Securities Act of 1933, as amended (the "1933 Act") in one or more distinct
series of Shares, and classes thereof (each class is hereinafter referred to as
a "Portfolio");
WHEREAS, the Adviser has been appointed investment adviser to the Fund;
WHEREAS, the Distributor is a broker-dealer registered with the U.S.
Securities and Exchange Commission (the "SEC") and a member in good standing of
the National Association of Securities Dealers, Inc. (the "NASD");
WHEREAS, the Fund, the Adviser and the Distributor desire to enter into
this Agreement pursuant to which the Distributor will provide distribution
services to the Portfolios of the Fund identified on Schedule A, as may be
amended from time to time, on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained in this Agreement, the Fund, the Adviser and the Distributor,
intending to be legally bound hereby, agree as follows:
1. APPOINTMENT OF DISTRIBUTOR. The Fund hereby appoints the Distributor
as its exclusive agent for the distribution of the Shares, and the Distributor
hereby accepts such appointment under the terms of this Agreement. The Fund
shall not sell any Shares to any person except to fill orders for the Shares
received through the Distributor; provided, however, that the foregoing
exclusive right shall not apply: (i) to Shares issued or sold in connection
with the merger or consolidation of any other investment company with the Fund
or the acquisition by purchase or otherwise of all or substantially all of the
assets of any investment company or substantially all of the outstanding shares
of any such company by the Fund; (ii) to Shares which may be offered by the Fund
to its shareholders for reinvestment of cash distributed from capital gains or
net investment income of the Fund; (iii) to Shares which may be issued to
shareholders of other funds who exercise any exchange privilege set forth in the
Fund's Prospectus; or (iv) to Shares which may be sold to persons purchasing
such Shares directly from the Fund or the Fund's Transfer Agent.
Notwithstanding any other provision hereof, the Fund may terminate, suspend, or
withdraw the offering of the Shares whenever, in its sole discretion, it deems
such action to be desirable, and the Distributor shall process no further orders
for Shares after it receives notice of such termination, suspension or
withdrawal.
2. FUND DOCUMENTS. The Fund has provided the Distributor with properly
certified or authenticated copies of the following Fund related documents in
effect on the date hereof: the Fund's organizational documents, including the
Trust Instrument and By-Laws; the Fund's Registration Statement on Form N-1A,
including all exhibits thereto; the Fund's most current Prospectus and Statement
of Additional Information; and resolutions of the Fund's Board of Trustees
authorizing the appointment of the Distributor and approving this Agreement.
The Fund shall promptly provide to the Distributor copies, properly certified or
authenticated, of all amendments or supplements to the foregoing. The Fund
shall provide to the Distributor copies of all other information which the
Distributor may reasonably request for use in connection with the distribution
of Shares, including, but not limited to, a certified copy of all financial
statements prepared for the Fund by its independent public accountants. The
Fund shall also supply the Distributor with such number of copies of the current
Prospectus, Statement of Additional Information and shareholder reports as the
Distributor shall reasonably request.
3. DISTRIBUTION SERVICES. The Distributor shall sell and repurchase
Shares as set forth below, subject to the registration requirements of the 1933
Act and the rules and regulations thereunder, and the laws governing the sale of
securities in the various states ("Blue Sky Laws"):
a. The Distributor, as agent for the Fund, shall sell Shares to the
public against orders therefor at the public offering price, which shall be the
net asset value of the Shares.
b. The net asset value of the Shares shall be determined in the
manner provided in the then current Prospectus and Statement of Additional
Information. The net asset value of the Shares shall be calculated by the Fund
or by another entity on behalf of the Fund. The Distributor shall have no duty
to inquire into or liability for the accuracy of the net asset value per Share
as calculated.
c. Upon receipt of purchase instructions, the Distributor shall
transmit such instructions to the Fund or its transfer agent for registration of
the Shares purchased.
d. The Distributor, in light of Fund policies, procedures and
disclosure documents, shall also have the right to take, as agent for the Fund,
all actions which, in the Distributor's judgment, are necessary to effect the
distribution of Shares.
e. Nothing in this Agreement shall prevent the Distributor or any
"affiliated person" from buying, selling or trading any securities for its or
their own account or for the accounts of others for whom it or they may be
acting; provided, however, that the Distributor expressly agrees that it shall
not for its own account purchase any Shares of the Fund except for investment
purposes and that it shall not for its own account sell any such Shares except
for redemption of such Shares by the Fund, and that it shall not undertake
activities, which, in its judgment, would adversely affect the performance of
its obligations to the Fund under this Agreement.
f. The Distributor, as agent for the Fund, shall repurchase Shares
at such prices and upon such terms and conditions as shall be specified in the
Prospectus.
4. DISTRIBUTION SUPPORT SERVICES. In addition to the sale and repurchase
of Shares, the Distributor shall perform the distribution support services set
forth on Schedule B attached hereto, as may be amended from time to time.
5. REASONABLE EFFORTS. The Distributor shall use all reasonable efforts
in connection with the distribution of Shares. The Distributor shall have no
obligation to sell any specific number of Shares and shall only sell Shares
against orders received therefor. The Fund shall retain the right to refuse at
any time to sell any of its Shares for any reason deemed adequate by it.
6. COMPLIANCE. In furtherance of the distribution services being
provided hereunder, the Distributor and the Fund agree as follows:
a. The Distributor shall comply with the Rules of Fair Practice of
the NASD and the securities laws of any jurisdiction in which it sells, directly
or indirectly, Shares.
b. The Distributor shall require each dealer with whom the
Distributor has a selling agreement to conform to the applicable provisions of
the Fund's most current Prospectus and Statement of Additional Information, with
respect to the public offering price of the Shares.
c. The Fund agrees to furnish to the Distributor sufficient copies
of any agreements, plans, communications with the public or other materials it
intends to use in connection with any sales of Shares in a timely manner in
order to allow the Distributor to review, approve and file such materials with
the appropriate regulatory authorities and obtain clearance for use. The Fund
agrees not to use any such materials until so filed and cleared for use by
appropriate authorities and the Distributor.
d. The Distributor, at its own expense, shall qualify as a broker or
dealer, or otherwise, under all applicable Federal or state laws required to
permit the sale of Shares in such states as shall be mutually agreed upon by the
parties.
e. The Distributor shall not, in connection with any sale or
solicitation of a sale of the Shares, or make or authorize any representative,
service organization, broker or dealer to make, any representations concerning
the Shares except those contained in the Fund's most current Prospectus covering
the Shares and in communications with the public or sales materials approved by
the Distributor as information supplemental to such Prospectus.
7. EXPENSES. Expenses shall be allocated as follows:
a. The Fund shall bear the following expenses: preparation, setting
in type, and printing of sufficient copies of the Prospectus and Statement of
Additional Information for distribution to existing shareholders; preparation
and printing of reports and other communications to existing shareholders;
distribution of copies of the Prospectus, Statement of Additional Information
and all other communications to existing shareholders; registration of the
Shares under the Federal securities laws; qualification of the Shares for sale
in the jurisdictions mutually agreed upon by the Fund and the Distributor;
transfer agent/shareholder servicing agent services; supplying information,
prices and other data to be furnished by the Fund under this Agreement; any
original issue taxes or transfer taxes applicable to the sale or delivery of the
Shares or certificates therefor.
b. The Adviser shall pay all other expenses incident to the sale and
distribution of the Shares sold hereunder, including, without limitation:
printing and distributing copies of the Prospectus, Statement of Additional
Information and reports prepared for use in connection with the offering of
Shares for sale to the public; advertising in connection with such offering,
including public relations services, sales presentations, media charges,
preparation, printing and mailing of advertising and sales literature; filing
fees required by regulatory authorities for sales literature and advertising
materials; any additional out-of-pocket expenses incurred in connection with the
foregoing and any other costs of distribution.
8. COMPENSATION. For the distribution and distribution support services
provided by the Distributor pursuant to the terms of the Agreement, the Adviser
shall pay to the Distributor the compensation set forth in Schedule A attached
hereto, which schedule may be amended from time to time. If this Agreement
becomes effective subsequent to the first day of the month or terminates before
the last day of the month, the Adviser shall pay to the Distributor a
distribution fee that is prorated for that part of the month in which this
Agreement is in effect. All rights of compensation and reimbursement under this
Agreement for services performed by the Distributor as of the termination date
shall survive the termination of this Agreement.
9. USE OF DISTRIBUTOR'S NAME. The Fund shall not use the name of the
Distributor or any of its affiliates in the Prospectus, Statement of Additional
Information, sales literature or other material relating to the Fund in a manner
not approved prior thereto in writing by the Distributor; provided, however,
that the Distributor shall approve all uses of its and its affiliates' names
that merely refer in accurate terms to their appointments or that are required
by the SEC or any state securities commission; and further provided, that in no
event shall such approval be unreasonably withheld.
10. USE OF FUND'S NAME. Neither the Distributor nor any of its affiliates
shall use the name of the Fund or material relating to the Fund on any forms
(including any checks, bank drafts or bank statements) for other than internal
use in a manner not approved prior thereto in writing by the Fund; provided,
however, that the Fund shall approve all uses of its name that merely refer in
accurate terms to the appointment of the Distributor hereunder or that are
required by the SEC or any state securities commission; and further provided,
that in no event shall such approval be unreasonably withheld.
11. LIABILITY OF DISTRIBUTOR. The duties of the Distributor shall be
limited to those expressly set forth herein, and no implied duties, except the
duty to act in good faith, are assumed by or may be asserted against the
Distributor hereunder. The Distributor may, in connection with this Agreement,
employ agents or attorneys in fact, and shall not be liable for any loss arising
out of or in connection with its actions under this Agreement, so long as it
acts in good faith and with due diligence, and is not negligent or guilty of any
willful misfeasance, bad faith, or reckless disregard of its obligations and
duties under this Agreement. As used in this Section 11 and in Section 12
(except the second paragraph of Section 12), the term "Distributor" shall
include directors officers, employees and other agents of the Distributor.
12. INDEMNIFICATION OF DISTRIBUTOR. Any director, officer, employee,
shareholder or agent of the Distributor who may be or become an officer,
Trustee, employee or agent of the Fund, shall be deemed, when rendering services
to the Fund or acting on any business of the Fund (other than services or
business in connection with the Distributor's duties hereunder), to be rendering
such services to or acting solely for the Fund and not as a director, officer,
employee, shareholder or agent of, or one under the control or direction of, the
Distributor, even though receiving a salary from the Distributor.
The Fund agrees to indemnify and hold harmless the Distributor, and each
person, who controls the Distributor within the meaning of Section 15 of the
1933 Act, or Section 20 of the Securities Exchange Act of 1934, as amended
("1934 Act"), against any and all liabilities, losses, damages, claims and
expenses, joint or several (including, without limitation, reasonable attorneys'
fees and disbursements) to which they, or any of them, may become subject under
the 1933 Act, the 1934 Act, the 1940 Act or other Federal or state laws or
regulations, at common law or otherwise, insofar as such liabilities, losses,
damages, claims and expenses (or actions, suits or proceedings in respect
thereof) arise out of or relate to any untrue statement or alleged untrue
statement of a material fact contained in a Prospectus, Statement of Additional
Information, supplement thereto, sales literature or other written information
prepared by the Fund and provided by the Fund to the Distributor for the
Distributor's use hereunder, or arise out of or relate to any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading. The Distributor (or
any person controlling the Distributor) shall not be entitled to indemnity
hereunder for any liabilities, losses, damages, claims or expenses (or actions,
suits or proceedings in respect thereof) resulting from (i) an untrue statement
or omission or alleged untrue statement or omission made in the Prospectus,
Statement of Additional Information, or supplement, sales or other literature,
in reliance upon and in conformity with information furnished in writing to the
Fund by the Distributor specifically for use therein or (ii) the Distributor's
own willful misfeasance, bad faith, gross negligence or reckless disregard of
its duties and obligations in the performance of this Agreement.
The Distributor agrees to indemnify and hold harmless the Fund, and each
person who controls the Fund within the meaning of Section 15 of the 1933 Act,
or Section 20 of the 1934 Act, against any and all liabilities, losses, damages,
claims and expenses, joint or several (including, without limitation reasonable
attorneys' fees and disbursements and investigation expenses incident thereto)
to which they, or any of them, may become subject under the 1933 Act, the 1934
Act, the 1940 Act or other Federal or state laws, at common law or otherwise,
insofar as such liabilities, losses, damages, claims or expenses arise out of or
relate to any untrue statement or alleged untrue statement of a material fact
contained in the Prospectus or Statement of Additional Information or any
supplement thereto, sales literature or other written material, or arise out of
or relate to actions or oral representations of Distributor's associated persons
and to any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, if based upon information furnished in writing to the Fund by the
Distributor specifically for use therein.
A party seeking indemnification hereunder (the "Indemnitee") shall give
prompt written notice to the party from whom indemnification is sought
("Indemnitor") of a written assertion or claim of any threatened or pending
legal proceeding which may be subject to indemnity under this Section; provided,
however, that failure to notify the Indemnitor of such written assertion or
claim shall not relieve the Indemnitor of any liability arising from this
Section. The Indemnitor shall be entitled, if it so elects, to assume the
defense of any suit brought to enforce a claim subject to this Agreement and
such defense shall be conducted by counsel chosen by the Indemnitor and
satisfactory to the Indemnitee; provided, however, that if the defendants
include both the Indemnitee and the Indemnitor, and the Indemnitee shall have
reasonably concluded that there may be one or more legal defenses available to
it which are different from or additional to those available to the Indemnitor
("conflict of interest"), the Indemnitor shall not have the right to elect to
defend such claim on behalf of the Indemnitee, and the Indemnitee shall have the
right to select separate counsel to defend such claim on behalf of the
Indemnitee. In the event that the Indemnitor elects to assume the defense of
any suit pursuant to the preceding sentence and retains counsel satisfactory to
the Indemnitee, the Indemnitee shall bear the fees and expenses of additional
counsel retained by it except for reasonable investigation costs which shall be
borne by the Indemnitor. If the Indemnitor (i) does not elect to assume the
defense of a claim, (ii) elects to assume the defense of a claim but chooses
counsel that is not satisfactory to the Indemnitee or (iii) has no right to
assume the defense of a claim because of a conflict of interest, the Indemnitor
shall advance or reimburse the Indemnitee, at the election of the Indemnitee,
reasonable fees and disbursements of any counsel retained by Indemnitee,
including reasonable investigation costs.
13. ADVISER PERSONNEL. The Adviser agrees that only its employees who are
registered representatives of the Distributor ("dual employees") or registered
representatives of another NASD member firm shall offer or sell Shares of the
Portfolios. The Adviser further agrees that the activities of any such
employees as registered representatives of the Distributor shall be limited to
offering and selling Shares. If there are dual employees, one employee of the
Adviser shall register as a principal of the Distributor and assist the
Distributor in monitoring the marketing and sales activities of the dual
employees. The Adviser shall maintain errors and omissions and fidelity bond
insurance policies providing reasonable coverage for its employees activities
and shall provide copies of such policies to the Distributor. The Adviser shall
indemnify and hold harmless the Distributor against any and all liabilities,
losses, damages, claims and expenses (including reasonable attorneys' fees and
disbursements and investigation costs incident thereto) arising from or related
to the Adviser's employees' activities as registered representatives, including,
without limitation, any and all such liabilities, losses, damages, claims and
expenses arising from or related to the breach by such employees of any rules or
regulations of the NASD or SEC.
14. FORCE MAJEURE. The Distributor shall not be liable for any delays or
errors occurring by reason of circumstances not reasonably foreseeable and
beyond its control, including, but not limited, to acts of civil or military
authority, national emergencies, work stoppages, fire, flood, catastrophe, acts
of God, insurrection, war, riot or failure of communication or power supply. In
the event of equipment breakdowns which are beyond the reasonable control of the
Distributor and not primarily attributable to the failure of the Distributor to
reasonably maintain or provide for the maintenance of such equipment, the
Distributor shall, at no additional expense to the Fund, take reasonable steps
in good faith to minimize service interruptions, but shall have no liability
with respect thereto.
15. SCOPE OF DUTIES. The Distributor, the Adviser and the Fund shall
regularly consult with each other regarding the Distributor's performance of its
obligations and its compensation under the foregoing provisions. In connection
therewith, the Fund shall submit to the Distributor at a reasonable time prior
to or at the same time as filing with the SEC copies of any amended or
supplemented Registration Statement of the Fund (including exhibits) under the
1940 Act and the 1933 Act, and at a reasonable time in advance of their proposed
use, copies of any amended or supplemented forms relating to any plan, program
or service offered by the Fund. Any change in such materials that would require
any change in the Distributor's obligations under the foregoing provisions shall
be subject to the Distributor's approval. In the event that a change in such
documents or in the procedures contained therein increases the cost or burden to
the Distributor of performing its obligations hereunder, the Distributor shall
be entitled to receive reasonable compensation therefore.
16. DURATION. This Agreement shall become effective as of the date first
above written, and shall continue in force for two years from that date and
thereafter from year to year, provided continuance is approved at least annually
by (i) either the vote of a majority of the Trustees of the Fund, or by the vote
of a majority of the outstanding voting securities of each Portfolio, and (ii)
the vote of a majority of those Trustees of the Fund who are not interested
persons of the Fund, and who are not parties to this Agreement or interested
persons of any such party, cast in person at a meeting called for the purpose of
voting on the approval.
17. TERMINATION. This Agreement shall terminate as follows:
a. This Agreement shall terminate automatically in the event of its
assignment.
b. This Agreement shall terminate upon any failure to approve the
continuance of the Agreement after the initial two year term as set forth in
Section 16 above.
c. This Agreement shall terminate at any time upon a vote of the
majority of the Trustees who are not interested persons of the Fund or by a vote
of the majority of the outstanding voting securities of each Portfolio, upon not
less than 60 days prior written notice to the Distributor.
d. The Distributor may terminate this Agreement upon not less than
60 days prior written notice to the Fund.
Upon the termination of this Agreement, the Adviser shall pay to the
Distributor such compensation and out-of-pocket expenses as may be payable for
the period prior to the effective date of such termination. In the event that
the Fund designates a successor to any of the Distributor's obligations
hereunder, the Distributor shall transfer to such successor all relevant books,
records and other data established or maintained by the Distributor pursuant to
the foregoing provisions.
Sections 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 17, 20, 21, 22, 23, 24, 25,
26 and 27 shall survive any termination of this Agreement.
18. AMENDMENT. The terms of this Agreement shall not be waived, altered,
modified, amended or supplemented in any manner whatsoever except by a written
instrument signed by the Distributor and the Fund and shall not become effective
unless its terms have been approved by the majority of the Trustees of the Fund
or by a "vote of majority of the outstanding voting securities" of each
Portfolio and by a majority of those Trustees who are not "interested persons"
of the Fund or any party to this Agreement.
19. NON-EXCLUSIVE SERVICES. The services of the Distributor rendered to
the Fund are not exclusive. The Distributor may render such services to any
other investment company.
20. DEFINITIONS. As used in this Agreement, the terms "vote of a majority
of the outstanding voting securities," "assignment," "interested person" and
"affiliated person" shall have the respective meanings specified in the 1940 Act
and the rules enacted thereunder as now in effect or hereafter amended.
21. CONFIDENTIALITY. The Distributor shall treat confidentially and as
proprietary information of the Fund all records and other information relating
to the Fund and prior, present or potential shareholders and shall not use such
records and information for any purpose other than performance of its
responsibilities and duties hereunder, except as may be required by
administrative or judicial tribunals or as requested by the Fund.
22. NOTICE. Any notices and other communications required or permitted
hereunder shall be in writing and shall be effective upon delivery by hand or
upon receipt if sent by certified or registered mail (postage prepaid and return
receipt requested) or by a nationally recognized overnight courier service
(appropriately marked for overnight delivery) or upon transmission if sent by
telex or facsimile (with request for immediate confirmation of receipt in a
manner customary for communications of such respective type and with physical
delivery of the communication being made by one or the other means specified in
this Section 22 as promptly as practicable thereafter). Notices shall be
addressed as follows:
(a) if to the Fund:
The Rockland Funds Trust
000 Xxxxx Xxxxxxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
(b) if to the Adviser:
Greenville Capital Management
000 Xxxxx Xxxxxxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
(c) if to the Distributor:
Unified Financial Securities, Inc.,
X.X. Xxx 0000
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxxxxxx
or to such other respective addresses as the parties shall designate by like
notice, provided that notice of a change of address shall be effective only upon
receipt thereof.
23. SEVERABILITY. 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.
24. GOVERNING LAW. This Agreement shall be administered, construed and
enforced in accordance with the laws of the State of Delaware to the extent that
such laws are not preempted by the provisions of any law of the United States
heretofore or hereafter enacted, as the same may be amended from time to time.
25. ENTIRE AGREEMENT. This Agreement (including the Schedules attached
hereto) contains the entire agreement and understanding of the parties with
respect to the subject matter hereof and supersedes all prior written or oral
agreements and understandings with respect thereto.
26. MISCELLANEOUS. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof. 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. This Agreement may be executed in three
counterparts, each of which taken together shall constitute one and the same
instrument.
27. LIMITATION OF LIABILITY. The term "The Rockland Funds Trust" means
and refers to the Trustees from time to time serving under the Trust Instrument
of the Fund dated July 31, 1996, as the same may subsequently thereto have been,
or subsequently hereto be, amended. It is expressly agreed that obligations of
the Fund hereunder shall not be binding upon any Trustee, shareholder, nominees,
officers, agents or employees of the Fund, personally, but bind only the assets
and property of the Fund, as provided in the Trust Instrument. The execution
and delivery of this Agreement have been authorized by the Trustees and signed
by an authorized officer of the Fund, acting as such, and neither such
authorization nor such execution and delivery 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 assets and property of the Fund as provided
in the Trust Instrument. The Trust Instrument is on file with the Secretary of
the State of Delaware.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
day and year first above written.
THE ROCKLAND FUNDS TRUST
By: /s/Xxxxxxx X. Xxxxxx
--------------------------------
President & Trustee
GREENVILLE CAPITAL MANAGEMENT
By: /s/Xxxxxxx X. Xxxxx
--------------------------------
UNIFIED FINANCIAL SECURITIES, INC.
By: /s/Xxx Xxxxxxxxxxxx
--------------------------------
SCHEDULE A
THE ROCKLAND FUNDS TRUST
Portfolios and Fee Schedule
Portfolios covered by Distribution Agreement:
Series
Rockland Small Cap Growth Fund
Fees for distribution and distribution support services on behalf of the
Portfolios:
Annual Fee $ 12,000
SCHEDULE B
ROCKLAND FUNDS TRUST
Distribution Support Services
1. Review and submit for approval all advertising and promotional materials.
2. Maintain all books and records required by the NASD.
3. Subject to approval of Distributor, license personnel as registered
representatives of the Distributor.
