ROCHDALE STRUCTURED CLAIMS INCOME FUND DISTRIBUTION AGREEMENT
DISTRIBUTION
AGREEMENT
THIS AGREEMENT is made and entered into
as of this 10th day of November 2009, by and among ROCHDALE STRUCTURED CLAIMS
INCOME FUND LLC, a Delaware limited liability company (the
“Fund”), and RIM SECURITIES LLC, a Delaware limited liability
company (“Distributor”).
WHEREAS,
the Fund are engaged in business as close-end management investment companies
and are registered as such under the Investment Company Act of 1940 (the "1940
Act"), and it is in the interest of the Fund to privately offer the shares of
Fund for sale for a specific period of time; and
WHEREAS,
the Distributor is registered as a broker-dealer under the Securities Exchange
Act of l934 (the "1934 Act") and is a member in good standing of the Financial
Industry Regulatory Authority ("FINRA"); and
WHEREAS,
the Fund and the Distributor wish to enter into an agreement with each other
with respect to the offering of the shares of beneficial interest of the Fund
(the "Shares"), to commence after the effectiveness of the registration
statement filed pursuant to the 1940 Act relating to the Fund.
NOW,
THEREFORE, the parties agree as follows:
l. Appointment of Distributor.
The Fund hereby appoints the Distributor as its exclusive agent to sell and to
arrange for the sale of the Shares, on the terms and for the period set forth in
this Agreement, and the Distributor hereby accepts such appointment and agrees
to act hereunder directly and/or through each Fund's transfer agent in the
manner set forth in the Prospectuses (as defined below). It is understood and
agreed that the services of the Distributor hereunder are not exclusive, and the
Distributor may act as principal underwriter for the shares of any other
registered investment company.
2. Shares Offered. Shares of
the Fund.
3.
Services and Duties of the Distributor.
(a) The
Distributor agrees to sell the Shares, as agent for the Fund, from time to time
during the term of this Agreement upon the terms described in the Fund's
Prospectuses. As used in this Agreement, the term "Prospectus" shall mean the
prospectuses and statements of additional information of the Fund included as
part of the Fund’s Registration Statement, as such prospectuses and statements
of additional information may be amended or supplemented from time to time, and
the term "Registration Statement" shall mean the Registration Statements most
recently filed from time to time by the Fund with the Securities and Exchange
Commission and effective under the 1940 Act, as such Registration Statements are
amended by any amendments thereto at the time in effect. The Distributor shall
not be obligated to sell any certain number of Shares.
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(b) Upon
commencement of the Fund’s operations, the Distributor will hold itself
available to receive orders, satisfactory to the Distributor, for the purchase
of the Shares and will accept such orders and will transmit such orders and Fund
received by it in payment for such Shares as are so accepted to the Fund’
transfer agent or custodian, as appropriate, as promptly as practicable.
Purchase orders shall be deemed effective at the time and in the manner set
forth in the Prospectus. The Distributor shall not make any short sales of
Shares.
(c) The
offering price of the Shares shall be the net asset value per share of the
Shares (as defined in the Operating Agreement of the Fund). The Fund shall
furnish the Distributor, with all possible promptness, an advice of each
computation of net asset value and offering price.
4.
Duties of the Fund.
(a)
Maintenance of Federal Registration. The Fund shall, at their expense, take,
from time to time, all necessary action and such steps, including payment of the
related filing fees, as may be necessary to register and maintain registration
of a sufficient number of Shares under the 0000 Xxx. The Fund agrees to file
from time to time such amendments, reports and other documents as may be
necessary in order that there may be no untrue statement of a material fact in a
registration statement or prospectus, or necessary in order that there may be no
omission to state a material fact in a registration statement or prospectus
which omission would make the statements therein misleading.
(b)
Maintenance of "Blue Sky" Qualifications. The Fund shall, at their expense, use
their best efforts to qualify and maintain the qualification of an appropriate
number of Shares for sale under the securities laws of such states as the
Distributor and the Fund may approve, and, if necessary or appropriate in
connection therewith, to qualify and maintain the qualification of the Fund as
brokers or dealers in such states; provided that the Fund shall not be required
to amend their Operating Agreements to comply with the laws of any state, to
maintain an office in any state, to change the terms of the offering of the
Shares in any state from the terms set forth in their Prospectuses, to qualify
as foreign corporations in any state or to consent to service of process in any
state other than with respect to claims arising out of the offering and sale of
the Shares. The Distributor shall furnish such information and other material
relating to its affairs and activities as may be required by the Fund in
connection with such qualifications.
(c)
Copies of Reports and Prospectuses. The Fund shall, at their expense, keep the
Distributor fully informed with regard to their affairs and in connection
therewith shall furnish to the Distributor copies of all information, financial
statements and other papers which the Distributor may reasonably request for use
in connection with the distribution of Shares, including such reasonable number
of copies of their Prospectuses and annual and interim reports as the
Distributor may request and shall cooperate fully in the efforts of the
Distributor to sell and arrange for the sale of the Shares and in the
performance of the Distributor under this Agreement.
5. Conformity with Applicable Law and
Rules. The Distributor agrees that in selling Shares hereunder it shall
conform in all respects with the laws of the United States and of any state in
which Shares may be offered, and with applicable rules and regulations of
FINRA.
6. Independent Contractor. In
performing its duties hereunder, the Distributor shall be an independent
contractor,
and neither the Distributor, nor any of its officers, directors, employees, or
representatives is or shall be an employee of the Fund in the performance of the
Distributor's duties hereunder. The Distributor shall be responsible for its own
conduct and the employment, control, and conduct of its agents and employees and
for injury to such agents or employees or to others through its agents or
employees. The Distributor assumes full responsibility for its agents and
employees under applicable statutes and agrees to pay all employee taxes
thereunder.
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7.
Indemnification.
(a) Indemnification of Fund.
The Distributor agrees to indemnify and hold harmless the Fund and each of their
present or former directors, officers, employees, representatives and each
person, if any, who controls or previously controlled the Fund within the
meaning of Section l5 of the 1933 Act against any and all losses, liabilities,
damages, claims or expenses (including the reasonable costs of investigating or
defending any alleged loss, liability, damage, claims or expense and reasonable
legal counsel fees incurred in connection therewith) to which the Fund or any
such person may become subject under the 1933 Act, under any other statute, at
common law, or otherwise, arising out of the acquisition of any Shares by any
person which (i) may be based upon any wrongful act by the Distributor or any of
the Distributor's directors, officers, employees or representatives, or (ii) may
be based upon any untrue statement or alleged untrue statement of a material
fact contained in a registration statement, prospectus, shareholder report or
other information covering Shares filed or made public by the Fund or any
amendment thereof or supplement thereto, or the 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 such statement or omission was made in
reliance upon information furnished to the Fund by the Distributor.
In no
case (i) is the Distributor's indemnity in favor of the Fund, or any person
indemnified to be deemed to protect the Fund or such indemnified person against
any liability to which the Fund or such person would otherwise be subject by
reason of willful misfeasance, bad faith, or gross negligence in the performance
of the Fund’s or any such person’s duties or by reason of the Fund’s or any such
person’s reckless disregard of the Fund’s or any such person’s obligations and
duties under this Agreement or (ii) is the Distributor to be liable under its
indemnity agreement contained in this Paragraph with respect to any claim made
against the Fund or any person indemnified unless the Fund or such person, as
the case may be, shall have notified the Distributor in writing of the claim
within a reasonable time after the summons or other first written notification
giving information of the nature of the claim shall have been served upon the
Fund or upon such person (or after the Fund or such person shall have received
notice to such service on any designated agent). However, failure to notify the
Distributor of any such claim shall not relieve the Distributor from any
liability which the Distributor may have to the Fund or any person against whom
such action is brought otherwise than on account of the Distributor's indemnity
agreement contained in this Paragraph.
The
Distributor shall be entitled to participate, at its own expense, in the
defense, or, if the Distributor so elects, to assume the defense of any suit
brought to enforce any such claim, but, if the Distributor elects to assume the
defense, such defense shall be conducted by legal counsel chosen by the
Distributor and satisfactory to the Fund, to the persons indemnified or
defendants, in the suit. In the event that the Distributor elects to assume the
defense of any such suit and retain such legal counsel, the Fund, the persons
indemnified or defendants in the suit, shall bear the fees and
expenses of any additional legal counsel retained by them. If the Distributor
does not elect to assume the defense of any such suit, the Distributor will
reimburse the Fund and the persons indemnified or defendants in such suit for
the reasonable fees and expenses of any legal counsel retained by them. The
Distributor agrees to promptly notify the Fund of the commencement of any
litigation of proceedings against it or any of its officers, employees or
representatives in connection with the issue or sale of any Shares.
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(b) Indemnification of the
Distributor. The Fund agrees to indemnify and hold harmless the
Distributor and each of its present or former directors, officers, employees,
representatives and each person, if any, who controls or previously controlled
the Distributor within the meaning of Section l5 of the 1933 Act against any and
all losses, liabilities, damages, claims or expenses (including the reasonable
costs of investigating or defending any alleged loss, liability, damage, claim
or expense and reasonable legal counsel fees incurred in connection therewith)
to which the Distributor or any such person may become subject under the 1933
Act, under any other statute, at common law, or otherwise, arising out of the
acquisition of any Shares by any person which (i) may be based upon any wrongful
act by the Fund or any of the Fund directors, officers, employees or
representatives, or (ii) may be based upon any untrue statement or alleged
untrue statement of a material fact contained in a registration statement,
prospectus, shareholder report or other information covering Shares filed or
made public by the Fund or any amendment thereof or supplement thereto, or the
omission or alleged omission to state therein 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 information furnished to
the Fund by the Distributor.
In no
case (i) is the Fund indemnity in favor of the Distributor, or any person
indemnified to be deemed to protect the Distributor or such indemnified person
against any liability to which the Distributor or such person would otherwise be
subject by reason of willful misfeasance, bad faith, or gross negligence in the
performance of his duties or by reason of his reckless disregard of his
obligations and duties under this Agreement, or (ii) is the Fund to be liable
under its indemnity agreement contained in this Paragraph with respect to any
claim made against Distributor, or person indemnified unless the Distributor, or
such person, as the case may be, shall have notified the Fund in writing of the
claim within a reasonable time after the summons or other first written
notification giving information of the nature of the claim shall have been
served upon the Distributor or upon such person (or after the Distributor or
such person shall have received notice of such service on any designated agent).
However, failure to notify the Fund of any such claim shall not relieve the Fund
from any liability which the Fund may have to the Distributor or any person
against whom such action is brought otherwise than on account of the Fund’
indemnity agreement contained in this Paragraph.
The Fund
shall be entitled to participate, at its own expense, in the defense, or, if the
Fund so elects, to assume the defense of any suit brought to enforce any such
claim, but if the Fund elects to assume the defense, such defense shall be
conducted by legal counsel chosen by the Fund and satisfactory to the
Distributor, to the persons indemnified defendant or defendants, in the suit. In
the event that the Fund elects to assume the defense of any such suit and retain
such legal counsel, the Distributor, the persons indemnified defendant or
defendants in the suit, shall bear the fees and expenses of any additional legal
counsel retained by them. If the Fund do not elect to assume the defense of any
such suit, the Fund will reimburse the Distributor and the persons indemnified
defendant or defendants in such suit for the reasonable fees and expenses of any
legal counsel retained by them. The Fund agree to promptly notify the
Distributor of the commencement of any litigation or proceedings against it or
any of its directors, officers, employees or representatives in connection with
the issue or sale of any Shares.
8. Authorized Representations.
The Distributor is not authorized by the Fund to give on behalf of the Fund any
information or to make any representations in connection with the sale of Shares
other than the information and representations contained in a registration
statement or prospectus filed with the Securities and Exchange Commission
("SEC") under the 1933 Act and/or the 1940 Act, covering Shares, as such
registration statement and prospectus may be amended or supplemented from time
to time, or contained in shareholder reports or other material that may be
prepared by or on behalf of the Fund for the Distributor's use. This shall not
be construed to prevent the Distributor from preparing and distributing
tombstone ads and sales literature or other material as it may deem appropriate.
No person other than the Distributor is authorized to act as principal
underwriter (as such term is defined in the 0000 Xxx) for the Fund.
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9. Term of Agreement. The term
of this Agreement shall begin on the date first above written, and unless sooner
terminated as hereinafter provided, this Agreement shall remain in effect for a
period of two years from the date first above written. Thereafter, this
Agreement shall continue in effect from year to year, subject to the termination
provisions and all other terms and conditions thereof, so long as such
continuation shall be specifically approved at least annually by the Board of
Directors or by vote of a majority of the outstanding voting securities of the
Fund and, concurrently with such approval by the Board of Directors or prior to
such approval by the holders of the outstanding voting securities of the Fund,
as the case may be, by the vote, cast in person at a meeting called for the
purpose of voting on such approval, of a majority of the Directors of the Fund
who are not parties to this Agreement or interested persons of any such party.
The Distributor shall furnish to the Fund, promptly upon its request, such
information as may reasonably be necessary to evaluate the terms of this
Agreement or any extension, renewal or amendment hereof.
10. Amendment or Assignment of
Agreement. This Agreement may not be amended or assigned except as
permitted by the 1940 Act, and this Agreement shall automatically and
immediately terminate in the event of its assignment.
11. Termination of Agreement.
This Agreement may be terminated by either party hereto, without the
payment of any penalty, on not more than upon 60 days' nor less than 30 days'
prior notice in writing to the other party; provided, that in the case of
termination by the Fund such action shall have been authorized by resolution of
a majority of the Directors of the Fund who are not parties to this Agreement or
interested persons of any such party, or by vote of a majority of the
outstanding voting securities of the Fund.
12. Miscellaneous. The
captions in this Agreement are included for convenience of reference only and in
no way define or delineate any of the provisions hereof or otherwise affect
their construction or effect. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. Nothing herein
contained shall be deemed to require the Fund to take any action contrary to the
Operating Agreements, or any applicable statutory or regulatory requirement to
which it is subject or by which it is bound, or to relieve or deprive the Boards
of Directors of the Fund of responsibility for and control of the conduct of the
affairs of the Fund.
13. Definition of Terms. Any
question of interpretation of any term or provision of this Agreement having a
counterpart in or otherwise derived from a term or provision of the 1940 Act
shall be resolved by reference to such term or provision of the 1940 Act and to
interpretation thereof, if any, by the United States courts or, in the absence
of any controlling decision of any such court, by rules, regulations or orders
of the Securities and Exchange Commission validly issued pursuant to the 1940
Act. Specifically, the terms "vote of a majority of the outstanding voting
securities", "interested persons", “assignment", and "affiliated person", as
used in Paragraphs 9, 10 and 11 hereof, shall have the meanings assigned to them
by Section 2(a) of the 1940 Act. In addition, where the effect of a requirement
of the 1940 Act reflected in any provision of this Agreement is relaxed by a
rule, regulation or order of the Securities and Exchange Commission, whether of
special or of general application, such provision shall be deemed to incorporate
the effect of such rule, regulation or order.
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14. Compliance with Securities
Laws. The Fund represent that it is registered as closed-end management
investment company under the 1940 Act . The Fund and the Distributor each agree
to comply with all of the applicable terms and provisions of the 1940 Act, the
1933 Act and, subject to the provisions of Section 4(d), all applicable "Blue
Sky" laws. The Distributor agrees to comply with all of the applicable terms and
provisions of the Securities Exchange Act of 1934.
15. Notices. Any notice
required to be given pursuant to this Agreement shall be deemed duly given if
delivered or mailed by registered mail, postage prepaid, to the Distributor and
to the Fund on behalf of the Fund at 000 Xxxxxxxxx Xxx., 0xx
Xxxxx, Xxx Xxxx, XX 00000-0000.
16. Governing Law. This
Agreement shall be governed and construed in accordance with the laws of the
State of New York.
17. No Shareholder Liability.
The Distributor understands that the obligations of this Agreement are not
binding upon any shareholder of the Fund personally, but bind only the Fund's
property; the Distributor represents that it has notice of the provisions of the
Operating Agreement disclaiming shareholder liability for acts or obligations of
the Fund.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by
their duly authorized representatives and their respective corporate seals to be
hereunto affixed, as of the day and year first above written.
By:
_______________________
Name:
_____________________
RIM
SECURITIES LLC
By:
________________________
Name:
______________________
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