Exhibit e(x) under N-1A
Exhibit 1 under 601/Reg SK
DISTRIBUTOR'S CONTRACT
AGREEMENT made this 24th day of October, 1997, by and between those
Investment Companies on behalf of the Portfolios and Classes of Shares listed on
Schedule A to Exhibit 1, as may be amended from time to time, having their
principal place of business at Federated Investors Tower, Pittsburgh,
Pennsylvania 15222-3779, and who have approved this form of Agreement, and
FEDERATED SECURITIES CORP. ("FSC"), a Pennsylvania Corporation. Each of the
Exhibits hereto is incorporated herein in its entirety and made a part hereof.
In the event of any inconsistency between the terms of this Agreement and the
terms of any applicable Exhibit, the terms of the applicable Exhibit shall
govern.
In consideration of the mutual covenants hereinafter contained, it is
hereby agreed by and between the parties hereto as follows:
1. Each of the Investment Companies hereby appoint FSC as agent to sell and
distribute shares of the Investment Companies which may be offered in one
or more series (the "Funds") consisting of one or more classes (the
"Classes") of shares (the "Shares"), as described and set forth on one or
more exhibits to this Agreement, at the current offering price thereof as
described and set forth in the current Prospectuses of the Funds. FSC
hereby accepts such appointment and agrees to provide such other services
for the Investment Companies, if any, and accept such compensation from the
Investment Companies, if any, as set forth in the applicable exhibits to
this Agreement.
2. The sale of any Shares may be suspended without prior notice whenever in
the judgment of the applicable Investment Company it is in its best
interest to do so.
3. Neither FSC nor any other person is authorized by the Investment Companies
to give any information or to make any representation relative to any
Shares other than those contained in the Registration Statement,
Prospectuses, or Statements of Additional Information ("SAIs") filed with
the Securities and Exchange Commission, as the same may be amended from
time to time, or in any supplemental information to said Prospectuses or
SAIs approved by the Investment Companies. FSC agrees that any other
information or representations other than those specified above which it or
any dealer or other person who purchases Shares through FSC may make in
connection with the offer or sale of Shares, shall be made entirely without
liability on the part of the Investment Companies. No person or dealer,
other than FSC, is authorized to act as agent for the Investment Companies
for any purpose. FSC agrees that in offering or selling Shares as agent of
the Investment Companies, it will, in all respects, duly conform to all
applicable state and federal laws and the rules and regulations of the
National Association of Securities Dealers, Inc., including its Rules of
Fair Practice. FSC will submit to the Investment Companies copies of all
sales literature before using the same and will not use such sales
literature if disapproved by the Investment Companies.
4. This Agreement is effective with respect to each Class as of the date of
execution of the applicable exhibit and shall continue in effect with
respect to each Class presently set forth on an exhibit and any subsequent
Classes added pursuant to an exhibit during the initial term of this
Agreement for one year from the date set forth above, and thereafter for
successive periods of one year if such continuance is approved at least
annually by the Trustees/Directors of the Investment Companies including a
majority of the members of the Board of Trustees/Directors of the
Investment Companies who are not interested persons of the Investment
Companies and have no direct or indirect financial interest in the
operation of any Distribution Plan relating to the Investment Companies or
in any related documents to such Plan ("Disinterested Trustees/Directors")
cast in person at a meeting called for that purpose. If a Class is added
after the first annual approval by the Trustees/Directors as described
above, this Agreement will be effective as to that Class upon execution of
the applicable exhibit and will continue in effect until the next annual
approval of this Agreement by the Trustees/Directors and thereafter for
successive periods of one year, subject to approval as described above.
5. This Agreement may be terminated with regard to a particular Fund or Class
at any time, without the payment of any penalty, by the vote of a majority
of the Disinterested Trustees/Directors or by a majority of the outstanding
voting securities of the particular Fund or Class on not more than sixty
(60) days' written notice to any other party to this Agreement.
6. This Agreement may not be assigned by FSC and shall automatically terminate
in the event of an assignment by FSC as defined in the Investment Company
Act of 1940, as amended, provided, however, that FSC may employ such other
person, persons, corporation or corporations as it shall determine in order
to assist it in carrying out its duties under this Agreement.
7. FSC shall not be liable to the Investment Companies for anything done or
omitted by it, except acts or omissions involving willful misfeasance, bad
faith, gross negligence, or reckless disregard of the duties imposed by
this Agreement.
8. This Agreement may be amended at any time by mutual agreement in writing of
all the parties hereto, provided that such amendment is approved by the
Trustees/Directors of the Investment Companies including a majority of the
Disinterested Trustees/Directors of the Investment Companies cast in person
at a meeting called for that purpose.
9. This Agreement shall be construed in accordance with and governed by the
laws of the Commonwealth of Pennsylvania.
10. (a) Subject to the conditions set forth below, the Investment Companies
agree to indemnify and hold harmless FSC and each person, if any, who
controls FSC within the meaning of Section 15 of the Securities Act of 1933
and Section 20 of the Securities Act of 1934, as amended, against any and
all loss, liability, claim, damage and expense whatsoever (including but
not limited to any and all expenses whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever) arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement, any Prospectuses or SAIs (as from time to
time amended and supplemented) or the omission or alleged omission
therefrom of 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 written
information furnished to the Investment Companies about FSC by or on behalf
of FSC expressly for use in the Registration Statement, any Prospectuses
and SAIs or any amendment or supplement thereof.
If any action is brought against FSC or any controlling person thereof with
respect to which indemnity may be sought against any Investment Company pursuant
to the foregoing paragraph, FSC shall promptly notify the Investment Company in
writing of the institution of such action and the Investment Company shall
assume the defense of such action, including the employment of counsel selected
by the Investment Company and payment of expenses. FSC or any such controlling
person thereof shall have the right to employ separate counsel in any such case,
but the fees and expenses of such counsel shall be at the expense of FSC or such
controlling person unless the employment of such counsel shall have been
authorized in writing by the Investment Company in connection with the defense
of such action or the Investment Company shall not have employed counsel to have
charge of the defense of such action, in any of which events such fees and
expenses shall be borne by the Investment Company. Anything in this paragraph to
the contrary notwithstanding, the Investment Companies shall not be liable for
any settlement of any such claim of action effected without their written
consent. The Investment Companies agree promptly to notify FSC of the
commencement of any litigation or proceedings against the Investment Companies
or any of their officers or Trustees/Directors or controlling persons in
connection with the issue and sale of Shares or in connection with the
Registration Statement, Prospectuses, or SAIs.
(b) FSC agrees to indemnify and hold harmless the Investment Companies, each of
its Trustees/Directors, each of its officers who have signed the
Registration Statement and each other person, if any, who controls the
Investment Companies within the meaning of Section 15 of the Securities Act
of 1933, but only with respect to statements or omissions, if any, made in
the Registration Statement or any Prospectus, SAI, or any amendment or
supplement thereof in reliance upon, and in conformity with, information
furnished to the Investment Companies about FSC by or on behalf of FSC
expressly for use in the Registration Statement or any Prospectus, SAI, or
any amendment or supplement thereof. In case any action shall be brought
against any Investment Company or any other person so indemnified based on
the Registration Statement or any Prospectus, SAI, or any amendment or
supplement thereof, and with respect to which indemnity may be sought
against FSC, FSC shall have the rights and duties given to the Investment
Companies, and the Investment Companies and each other person so
indemnified shall have the rights and duties given to FSC by the provisions
of subsection (a) above.
(c) Nothing herein contained shall be deemed to protect any person against
liability to the Investment Companies or their shareholders to which such
person would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of the duties of such person
or by reason of the reckless disregard by such person of the obligations
and duties of such person under this Agreement.
(d) Insofar as indemnification for liabilities may be permitted pursuant to
Section 17 of the Investment Company Act of 1940, as amended, for
Trustees/Directors, officers, FSC and controlling persons of the Investment
Companies by the Trustees/Directors pursuant to this Agreement, the
Investment Companies are aware of the position of the Securities and
Exchange Commission as set forth in the Investment Company Act Release No.
IC-11330. Therefore, the Investment Companies undertakes that in addition
to complying with the applicable provisions of this Agreement, in the
absence of a final decision on the merits by a court or other body before
which the proceeding was brought, that an indemnification payment will not
be made unless in the absence of such a decision, a reasonable
determination based upon factual review has been made (i) by a majority
vote of a quorum of non-party Disinterested Trustees/Directors, or (ii) by
independent legal counsel in a written opinion that the indemnitee was not
liable for an act of willful misfeasance, bad faith, gross negligence or
reckless disregard of duties. The Investment Companies further undertakes
that advancement of expenses incurred in the defense of a proceeding (upon
undertaking for repayment unless it is ultimately determined that
indemnification is appropriate) against an officer, Trustees/Directors, FSC
or controlling person of the Investment Companies will not be made absent
the fulfillment of at least one of the following conditions: (i) the
indemnitee provides security for his undertaking; (ii) the Investment
Companies is insured against losses arising by reason of any lawful
advances; or (iii) a majority of a quorum of non-party Disinterested
Trustees/Directors or independent legal counsel in a written opinion makes
a factual determination that there is reason to believe the indemnitee will
be entitled to indemnification.
Error! Reference source not found.
11. If at any time the Shares of any Fund are offered in two or more Classes,
FSC agrees to adopt compliance standards as to when a class of shares may
be sold to particular investors.
12. This Agreement will become binding on the parties hereto upon the execution
of the attached exhibits to the Agreement.
Exhibit 1
to the
Distributor's Contract
The following provisions are hereby incorporated and made part of the
Distributor's Contract (the "Distributor's Contract") dated October 24, 1997,
between the Investment Companies and Federated Securities Corp. as principal
distributor (the "Principal Distributor") with respect to the Class B Shares of
the portfolios (the "Funds") set forth on the attached Schedule A. References
herein to this Distributor's Contract refer to the Distributor's Contract as
supplemented hereby and made applicable hereby to the Class B Shares of the
Funds. In the event of any inconsistency between the terms of this Exhibit and
the terms of the Distributor's Contract, the terms of this Exhibit will govern.
Once effective in respect of the Class of Shares of any Fund set forth above,
the Distributors Contract as amended by this Exhibit shall be effective in
respect of all shares of such class outstanding whether issued prior to or after
such effectiveness.
1. The Investment Companies hereby appoints the Principal Distributor to
engage in activities principally intended to result in the sale of Class B
Shares ("Class B Shares") of each Fund. Pursuant to this appointment, the
Principal Distributor is authorized to select a group of financial
institutions ("Financial Institutions") to sell Class B Shares of a Fund at
the current offering price thereof as described and set forth in the
respective prospectuses of the Fund.
2. (a) In consideration of the Principal Distributor's services under this
Distributor's Contract in respect of each Fund the Investment Companies on
behalf of the Fund agree: (I) to pay the Principal Distributor or at its
direction its "Allocable Portion" (as hereinafter defined) of a fee (the
"Distribution Fee") equal to 0.75 of 1% per annum of the average daily net
asset value of the Class B Shares of the Fund outstanding from time to
time, and (II) to withhold from redemption proceeds in respect of Class B
Shares of the Fund such Principal Distributor's Allocable Portion of the
Contingent Deferred Sales Charges ("CDSCs") payable in respect of such
redemption as provided in the Prospectus for the Fund and to pay the same
over to such Principal Distributor or at its direction at the time the
redemption proceeds in respect of such redemption are payable to the holder
of the Class B Shares redeemed.
(b) The Principal Distributor will be deemed to have performed all services
required to be performed in order to be entitled to receive its Allocable
Portion of the Distribution Fee payable in respect of the Class B Shares of
a Fund upon the settlement of each sale of a "Commission Share" (as defined
in the Allocation Schedule attached hereto as Schedule B) of the Fund taken
into account in determining such Principal Distributor's Allocable Portion
of such Distribution Fees.
(c) Notwithstanding anything to the contrary set forth in this Exhibit, the
Distributor's Contract or (to the extent waiver thereof is permitted
thereby) applicable law, the Investment Companies' obligation to pay the
Principal Distributor's Allocable Portion of the Distribution Fees payable
in respect of the Class B Shares of a Fund shall not be terminated or
modified for any reason (including a termination of this Distributor's
Contract as it relates to Class B Shares of a Fund) except to the extent
required by a change in the Investment Company Act of 1940 (the "Act") or
the Conduct Rules of the National Association of Securities Dealers, Inc.,
in either case enacted or promulgated after May 1, 1997, or in connection
with a "Complete Termination" (as hereinafter defined) of the Distribution
Plan in respect of the Class B Shares of a Fund.
(d) The Investment Companies will not take any action to waive or change any
CDSC in respect of the Class B Shares of a Fund, except as provided in the
Investment Companies' prospectus or statement of additional information as
in effect as of the date hereof without the consent of the Principal
Distributor and the permitted assigns of all or any portion of its right to
its Allocable Portion of the CDSCs.
(e) Notwithstanding anything to the contrary set forth in this Exhibit, the
Distributor's Contract, or (to the extent waiver thereof is permitted
thereby) applicable law, neither the termination of the Principal
Distributor's role as principal distributor of the Class B Shares of a
Fund, nor the termination of this Distributor's Contract nor the
termination of the Distribution Plan will terminate such Principal
Distributor's right to its Allocable Portion of the CDSCs in respect of the
Class B Shares of a Fund.
(f) Notwithstanding anything to the contrary in this Exhibit, the Distributor's
Contract, or (to the extent waiver thereof is permitted thereby) applicable
law, the Principal Distributor may assign, sell or pledge (collectively, a
"Transfer") its rights to its Allocable Portion of the Distribution Fees
and CDSCs earned by it (but not its obligations to the Investment Companies
under this Distributor's Contract) in respect of the Class B Shares of a
Fund to raise funds to make the expenditures related to the distribution of
Class B Shares of the Fund and in connection therewith upon receipt of
notice of such Transfer, the Investment Companies shall pay, or cause to be
paid to the assignee, purchaser or pledgee (collectively with their
subsequent transferees, "Transferees") such portion of the Principal
Distributor's Allocable Portion of the Distribution Fees and CDSCs in
respect of the Class B Shares of the Fund so Transferred. Except as
provided in (c) above and notwithstanding anything to the contrary set
forth elsewhere in this Exhibit, the Distributor's Contract, or (to the
extent waiver thereof is permitted thereby) applicable law, to the extent
the Principal Distributor has Transferred its rights thereto to raise funds
as aforesaid, the Investment Companies' obligation to pay to the Principal
Distributor's Transferees the Principal Distributor's Allocable Portion of
the Distribution Fees payable in respect of the Class B Shares of each Fund
shall be absolute and unconditional and shall not be subject to dispute,
offset, counterclaim or any defense whatsoever, including without
limitation, any of the foregoing based on the insolvency or bankruptcy of
the Principal Distributor (it being understood that such provision is not a
waiver of the Investment Companies' right to pursue such Principal
Distributor and enforce such claims against the assets of such Principal
Distributor other than the Distributor's right to the Distribution Fees,
CDSCs and servicing fees, in respect of the Class B Shares of any Fund
which have been so transferred in connection with such Transfer). The Fund
agrees that each such Transferee is a third party beneficiary of the
provisions of this clause (f) but only insofar as those provisions relate
to Distribution Fees and CDSCs transferred to such Transferee.
(g) For purposes of this Distributor's Contract, the term Allocable Portion of
Distribution Fees payable in respect of the Class B Shares of any Fund
shall mean the portion of such Distribution Fees allocated to such
Principal Distributor in accordance with the Allocation Schedule attached
hereto as Schedule B.
(h) For purposes of this Distributor's Contract, the term "Complete
Termination" of the Plan in respect of any Fund means a termination of the
Plan involving the complete cessation of the payment of Distribution Fees
in respect of all Class B Shares of such Fund, and the termination of the
distribution plans and the complete cessation of the payment of
distribution fees pursuant to every other Distribution Plan pursuant to
rule 12b-1 of the Investment Companies in respect of such Fund and any
successor Fund or any Fund acquiring a substantial portion of the assets of
such Fund and for every future class of shares which has substantially
similar characteristics to the Class B Shares of such Fund including the
manner of payment and amount of sales charge, contingent deferred sales
charge or other similar charges borne directly or indirectly by the holders
of such shares.
3. The Principal Distributor may enter into separate written agreements with
various firms to provide certain of the services set forth in Paragraph 1
herein. The Principal Distributor, in its sole discretion, may pay
Financial Institutions a lump sum fee on the settlement date for the sale
of each Class B Share of the Fund to their clients or customers for
distribution of such share. The schedules of fees to be paid such firms or
Financial Institutions and the basis upon which such fees will be paid
shall be determined from time to time by the Principal Distributor in its
sole discretion.
4. The Principal Distributor will prepare reports to the Board of
Trustees/Directors of the Investment Companies on a quarterly basis showing
amounts expended hereunder including amounts paid to Financial Institutions
and the purpose for such expenditures.
In consideration of the mutual covenants set forth in the Distributor's
Contract between the Investment Companies and the Principal Distributor, the
Principal Distributor and the Investment Companies hereby execute and deliver
this Exhibit with respect to the Class B Shares of the Fund.
Witness the due execution hereof this 24th day of October, 1997.
ATTEST: INVESTMENT COMPANIES (listed on Schedule A)
By: /s/ S. Xxxxxxx Xxxxx By: /s/ Xxxx X. XxXxxxxxx
Title: Assistant Secretary` Title: Executive Vice President
ATTEST: FEDERATED SECURITIES CORP.
By: /s/ Xxxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxxx
Title: Assistant Secretary Title: Vice President
Schedule B
to the
Distributor's Contract
for Class B Shares of the
Federated Funds
ALLOCATION SCHEDULE
Contingent Deferred Sales Charges and Asset Based Sales Charges related to
Shares of each Fund shall be allocated among the existing Principal Distributor
and any subsequent Principal Distributor in accordance with this Schedule B.
Defined terms used in this Schedule B and not otherwise defined herein
shall have the meaning assigned to them in the Distributor's Contract. As used
herein the following terms shall have the meanings indicated:
"Commission Share", means in respect of any Fund, each Share of such Fund,
other than an Omnibus Share, which is issued under circumstances which would
normally give rise to an obligation of the holder of such Share to pay a
Contingent Deferred Sales Charge upon redemption of such Share (including,
without limitation, any Share of such Fund issued in connection with a Permitted
Free Exchange) and any such Share shall continue to be a Commission Share of
such Fund prior to the redemption (including a redemption in connection with a
Permitted Free Exchange) or conversion of such Share, even though the obligation
to pay the Contingent Deferred Sales Charge may have expired or conditions for
waivers thereof may exist.
"Date of Original Issuance" means in respect of any Commission Share, the
date with reference to which the amount of the Contingent Deferred Sales Charge
payable on redemption thereof, if any, is computed.
"Existing Distributor Cut-Off Date" means , in respect of any Fund, the
last date on which the existing Principal Distributor acted as Principal
Distributor of Shares of such Fund.
"Free Share" means, in respect of any Fund, each Share of such Fund, other
than a Commission Share or Omnibus Share (including, without limitation, any
Share issued in connection with the reinvestment of dividends or capital gains).
"Inception Date" means in respect of any Fund, the first date on which such
Fund issued Shares.
"Net Asset Value" means, (i) with respect to any Fund, as of the date any
determination thereof is made, the net asset value of such Fund computed in the
manner such value is required to be computed by such Fund in its reports to its
shareholders, and (ii) with respect to any Share of such Fund as of any date,
the quotient obtained by dividing: (A) the net asset value of such Fund (as
computed in accordance with clause (i) above) allocated to Shares of such Fund
(in accordance with the constituent documents for such Fund) as of such date, by
(B) the number of Shares of such Fund outstanding on such date.
"Omnibus Share" means, in respect of any Fund, a commission share sold by
one of the Selling Agents listed on Exhibit I. If the Fund, the existing
Principal Distributor and its Transferees and each subsequent Principal
Distributor determine that the Seller's Transfer Agent is able to track all
commission shares sold by any of the Selling Agents listed on Exhibit I in the
same manner as Commission Shares are currently tracked in respect of Selling
Agents not listed on Exhibit I, then Exhibit I shall be amended to delete such
Selling Agent from Exhibit I so that commission shares sold by such Selling
Agent will thereafter be treated as Commission Shares.
"Subsequent Distributor Start-Up Date" means, in respect of any subsequent
Principal Distributor and any Fund, the first date on which such subsequent
Principal Distributor acted as principal distributor of Shares of such Fund.
"Subsequent Distributor Cut-Off Date" means, in respect of any subsequent
Principal Distributor and any Fund, the last date on which such subsequent
Principal Distributor acted as principal distributor of Shares of such Fund.
PART I:ATTRIBUTION OF SHARES
Shares of each Fund, which are outstanding from time to time, shall be
attributed to the existing Principal Distributor and any subsequent Principal
Distributor in accordance with the following rules:
(1) Commission Shares:
(a) Commission Shares of any Fund attributed to the existing Principal
Distributor shall be Commission Shares, the Date of Original Issuance of which
occurred on or after the Inception Date of such Fund and on or prior to the
Existing Distributor Cut-Off Date in respect of such Fund.
(b) Commission Shares of any Fund attributed to any subsequent Principal
Distributor shall be Commission Shares of such Fund, the Date of Original
Issuance of which occurs after the Subsequent Distributor Start-Up Date and on
or prior to the Subsequent Distributor Cut-Off Date.
(c) A Commission Share of a particular Fund (the "Issuing Fund") issued in
consideration of the investment of the proceeds of the redemption of a
Commission Share of another Fund (the "Redeeming Fund") in connection with a
Permitted Free Exchange, is deemed to have a Date of Original Issuance identical
to the Date of Original Issuance of the Commission Share of the Redeeming Fund
and any such Commission Share will be attributed to the existing Principal
Distributor or a subsequent Principal Distributor based upon such Date of
Original Issuance in accordance with rules (a) and (b) above.
(d) A Commission Share redeemed other than in connection with a Permitted
Free Exchange or converted to a Class A share is attributable to the existing
Principal Distributor or a subsequent Principal Distributor based upon the Date
of Original Issuance in accordance with rule (a), (b) and (c) above.
(2) Omnibus Shares:
Omnibus Shares of a Fund outstanding on any date shall be attributed to the
existing Principal Distributor or a subsequent Principal Distributor, as the
case may be, in the same proportion that outstanding Commission Shares of such
Fund are attributed to it on such date.
(3) Free Shares:
Free Shares of a Fund outstanding on any date shall be attributed to the
existing Principal Distributor or a subsequent Principal Distributor, as the
case may be, in the same proportion that the Commission Shares of such Fund
outstanding on such date are attributed to it on such date.
PART II: ALLOCATION OF CONTINGENT DEFERRED SALES CHARGES ("CDSCs")
(1) CDSCs Related to the Redemption of Commission Shares:
CDSCs in respect of the redemption of Commission Shares shall be allocated
to the existing Principal Distributor or a subsequent Principal Distributor
depending upon whether the related redeemed Commission Share is attributable to
the existing Principal Distributor or such subsequent Principal Distributor, as
the case may be, in accordance with Part I above.
(2) CDSCs Related to the Redemption of Omnibus Shares:
Aggregate CDSCs in respect of the redemption of Omnibus Shares of all Funds
during any period shall be allocated to the existing Principal Distributor or a
subsequent Principal Distributor in the same proportion that aggregate CDSCs
related to Commission Shares of all Funds during such period were allocated to
each thereof.
PART III: ALLOCATION OF ASSET BASED SALES CHARGES
Assuming that the Asset Based Sales Charge remains constant over time and
among Funds so that Part IV hereof does not become operative:
(1) The portion of the aggregate Asset Based Sales Charges accrued in
respect of all Shares of all Funds during any calendar month allocable to the
existing Principal Distributor or a subsequent Principal Distributor is
determined by multiplying the total of such Asset Based Sales Charges by the
following fraction:
(A + C) / 2
(B + D) / 2
where:
A = The aggregate Net Asset Value of all Shares of all Funds attributed to
the existing Principal Distributor or such subsequent Principal
Distributor, as the case may be, and outstanding at the beginning of such
calendar month
B = The aggregate Net Asset Value of all Shares of all Funds at the beginning
of such calendar month
C = The aggregate Net Asset Value of all Shares of all Funds attributed to
the existing Principal Distributor or such subsequent Principal
Distributor, as the case may be, and outstanding at the end of such
calendar month
D = The aggregate Net Asset Value of all Shares of all Funds at the end of
such calendar month
(2) If the Fund, the existing Principal Distributor and its Transferees and
each subsequent Principal Distributor determine that the Transfer Agent is able
to produce automated monthly reports which allocate the average Net Asset Value
of the Commission Shares (or all Shares if available) of all Funds among the
existing Principal Distributor and each subsequent Principal Distributor in a
manner consistent with the methodology detailed in Part I and Part III(1) above,
the portion of the Asset Based Sales Charges accrued in respect of all Shares of
all Funds during a particular calendar month will be allocated to the existing
Principal Distributor and each subsequent Principal Distributor by multiplying
the total of such Asset Based Sales Charges by the following fraction:
(A) / (B)
where:
A = Average Net Asset Value of all the Commission Shares (or all Shares if
available) of all Funds for such calendar month attributed to the existing
Principal Distributor or such subsequent Principal Distributor, as the case
may be
B = Total average Net Asset Value of all Commission Shares (or all Shares if
available) of all Funds for such calendar month
PART IV: ADJUSTMENTS OF THE EXISTING PRINCIPAL DISTRIBUTOR'S AND EACH
SUBSEQUENT PRINCIPAL DISTRIBUTOR'S ALLOCABLE SHARE OF ASSET BASED SALES CHARGES
AND CONTINGENT DEFERRED SALES CHARGES
The Parties to the Distributor's Contract recognize that, if the terms of
any Distributor's Contract, any Distribution Plan, any Prospectus, the Conduct
Rules or any other Applicable Law change disproportionately reduces, in a manner
inconsistent with the intent of this Allocation Schedule the amount of the
existing Principal Distributor's or any subsequent Principal Distributor's
Allocable Portion of Asset Based Sales Charges or Contingent Deferred Sales
Charges in respect of any Fund that would have been determined on the basis of
this Allocation Schedule as of any date had no such change occurred, this
Allocation Schedule in respect of the Shares relating to such Fund shall be
adjusted by agreement among the Fund, the existing Principal Distributor and its
Transferees and each subsequent Principal Distributor; provided, however, if the
existing Principal Distributor, such Transferees, each subsequent Principal
Distributor and such Fund cannot agree within thirty (30) days after the date of
any such change, the Parties shall submit the question to arbitration in
accordance with the commercial arbitration rules of the American Arbitration
Association and the decision reached by the arbitrator shall be final and
binding on the Parties hereto.
EXHIBIT I
SELLING AGENTS CURRENTLY OFFERING OMNIBUS SHARES
1. Xxxxxxx Xxxxx
2. Core-Link
Federated Capital Income Fund
Class B Shares
Amendment to
Distributor's Contract
between
Federated Funds with Class B Shares
and
Federated Securities Corp.
This Amendment to the Distributor's Contract ("Agreement") dated October
24, 1997, between those Federated Funds with Class B Shares listed on the
Exhibit to the Agreement ("Fund") and Federated Securities Corp. ("Service
Provider") is made and entered into as of the 1st day of June, 2001.
WHEREAS, the Fund has entered into the Agreement with the Service Provider;
WHEREAS, the Securities and Exchange Commission has adopted Regulation S-P
at 17 CFR Part 248 to protect the privacy of individuals who obtain a financial
product or service for personal, family or household use;
WHEREAS, Regulation S-P permits financial institutions, such as the Fund,
to disclose "nonpublic personal information" ("NPI") of its "customers" and
"consumers" (as those terms are therein defined in Regulation S-P) to affiliated
and nonaffiliated third parties of the Fund, without giving such customers and
consumers the ability to opt out of such disclosure, for the limited purposes of
processing and servicing transactions (17 CFR ss. 248.14) ("Section 248.14
NPI"); for specified law enforcement and miscellaneous purposes (17 CFR ss.
248.15) ("Section 248.15 NPI") ; and to service providers or in connection with
joint marketing arrangements (17 CFR ss. 248.13) ("Section 248.13 NPI");
WHEREAS, Regulation S-P provides that the right of a customer and consumer
to opt out of having his or her NPI disclosed pursuant to 17 CFR ss. 248.7 and
17 CFR ss. 248.10 does not apply when the NPI is disclosed to service providers
or in connection with joint marketing arrangements, provided the Fund and third
party enter into a contractual agreement that prohibits the third party from
disclosing or using the information other than to carry out the purposes for
which the Fund disclosed the information (17 CFR ss. 248.13);
NOW, THEREFORE, the parties intending to be legally bound agree as follows:
0 The Fund and the Service Provider hereby acknowledge that the Fund may
disclose shareholder NPI to the Service Provider as agent of the Fund and
solely in furtherance of fulfilling the Service Provider's contractual
obligations under the Agreement in the ordinary course of business to
support the Fund and its shareholders.
1 The Service Provider hereby agrees to be bound to use and redisclose such
NPI only for the limited purpose of fulfilling its duties and obligations
under the Agreement, for law enforcement and miscellaneous purposes as
permitted in 17 CFR xx.xx. 248.15, or in connection with joint marketing
arrangements that the Funds may establish with the Service Provider in
accordance with the limited exception set forth in 17 CFR ss. 248.13.
2 The Service Provider further represents and warrants that, in accordance
with 17 CFR ss. 248.30, it has implemented, and will continue to carry out
for the term of the Agreement, policies and procedures reasonably designed
to:
o insure the security and confidentiality of records and NPI of Fund
customers,
o protect against any anticipated threats or hazards to the security or
integrity of Fund customer records and NPI, and
o protect against unauthorized access to or use of such Fund customer
records or NPI that could result in substantial harm or inconvenience
to any Fund customer.
4. The Service Provider may redisclose Section 248.13 NPI only to: (a)
the Funds and affiliated persons of the Funds ("Fund Affiliates"); (b)
affiliated persons of the Service Provider ("Service Provider
Affiliates") (which in turn may disclose or use the information only
to the extent permitted under the original receipt); (c) a third party
not affiliated with the Service Provider of the Funds ("Nonaffiliated
Third Party") under the service and processing (ss.248.14) or
miscellaneous (ss.248.15) exceptions, but only in the ordinary course
of business to carry out the activity covered by the exception under
which the Service Provider received the information in the first
instance; and (d) a Nonaffiliated Third Party under the service
provider and joint marketing exception (ss.248.13), provided the
Service Provider enters into a written contract with the Nonaffiliated
Third Party that prohibits the Nonaffiliated Third Party from
disclosing or using the information other than to carry out the
purposes for which the Funds disclosed the information in the first
instance.
5. The Service Provider may redisclose Section 248.14 NPI and Section
248.15 NPI to: (a) the Funds and Fund Affiliates; (b) Service Provider
Affiliates (which in turn may disclose the information to the same
extent permitted under the original receipt); and (c) a Nonaffiliated
Third Party to whom the Funds might lawfully have disclosed NPI
directly.
6. The Service Provider is obligated to maintain beyond the termination
date of the Agreement the confidentiality of any NPI it receives from
the Fund in connection with the Agreement or any joint marketing
arrangement, and hereby agrees that this Amendment shall survive such
termination.
WITNESS the due execution hereof this 1st day of June, 2001.
Federated Funds with Class B Shares
(listed on the Exhibit to the Agreement)
By: /s/ Xxxx X. XxXxxxxxx
Name: Xxxx X. XxXxxxxxx
Title: Secretary
Federated Securities Corp.
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President
