DISTRIBUTION AGREEMENT
THIS AGREEMENT is made as of this 31st day of December, 2000 by and
between Pictet Funds (the "Trust") and PFPC Distributors, Inc. (the
"Distributor"), a corporation organized under the laws of the Commonwealth of
Massachusetts, having its principal place of business at 0000 Xxxxxxxx Xxxxx,
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000.
WHEREAS, the Trust is registered as an open-end, diversified management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act") and is currently offering units of beneficial interest (such units
of all series are hereinafter called the "Shares"), representing interests in
investment portfolios of the Trust identified on Schedule A hereto (the "Funds")
which are registered with the Securities and Exchange Commission ("SEC")
pursuant to the Trust's Registration Statement on Form N-1A (the "Registration
Statement"); and
WHEREAS, the Trust desires to retain the Distributor as distributor for
the Fund to provide for the sale and distribution of the Shares of the Funds
identified on Schedule A, and for such additional classes or series as the Trust
may issue, and the Distributor is prepared to provide such services commencing
on the Effective Date as such term is defined in Section 2 hereof.
NOW THEREFORE, in consideration of the premises and mutual covenants
set forth herein and intending to be legally bound hereby the parties hereto
agree as follows:
1. SERVICE AS DISTRIBUTOR
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1.1 The Distributor will act on behalf of the Trust for the distribution of
the Shares covered by the Registration Statement under the Securities
Act of 1933, as amended (the "1933 Act"). The Distributor will have no
liability for payment for the purchase of Shares sold pursuant to this
Agreement or with respect to redemptions or repurchases of Shares.
1.2 The Distributor agrees to use efforts deemed appropriate by the
Distributor 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 the
Distributor is now, and may in the future be, the distributor of the
shares of several investment companies or series (collectively, the
"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 the Distributor's duties to such
Companies shall not be deemed in conflict with its duties to the Trust
under this paragraph 1.2.
1.3 The Distributor shall, at its own expense, finance appropriate agreed
upon activities which it deems reasonable which are primarily intended
to result in the sale of the Shares, including, but not limited to, the
printing and mailing of prospectuses to other than current
shareholders.
1.4 All activities by the Distributor and its employees, as distributor of
the Shares, shall comply with all applicable laws, rules and
regulations, including, without limitation, all rules and regulations
made or adopted pursuant to the 1940 Act by the SEC or the National
Association of Securities Dealers.
1.5 The Distributor will transmit any orders received by it for purchase
or redemption of the Shares to the transfer agent for the Trust.
1.6 Whenever in their judgment such action is warranted by unusual market,
economic or political conditions, the Trust 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
and the Trust advises the Distributor promptly of such determination.
1.7 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
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in such states as the Distributor may designate. The Trust shall notify
the Distributor in writing of the states in which the Shares may be
sold and shall notify the Distributor in writing of any changes to the
information contained in the previous notifications.
1.8 The Trust shall furnish from time to time, for use in connection with
the sale of the Shares, such information with respect to the Trust and
the Shares as the 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 the Distributor upon request with: (a) audited
annual statements and unaudited semi-annual statements of a Fund's
books and accounts prepared by the Trust, (b) quarterly earnings
statements prepared by the Trust, (c) a monthly itemized list of the
securities in the Funds, (d) monthly balance sheets as soon as
practicable after the end of each month, and (e) from time to time such
additional information regarding the financial condition of the Trust
as the Distributor may reasonably request.
1.9 The Trust represents to the Distributor that all Registration
Statements and prospectuses filed by the Trust with the SEC under the
1933 Act with respect to the Shares have been prepared in conformity
with the requirements of said Act and the rules and regulations of the
SEC thereunder. As used in this Agreement, the term "Registration
Statement" shall mean any Registration Statement and any prospectus and
any statement of additional information relating to the Trust filed
with the SEC and any amendments or supplements thereto at any time
filed with said Commission. The Trust represents and warrants to the
Distributor that any Registration Statement, when such Registration
Statement becomes effective, will contain statements required to be
stated therein in conformity with the 1933 Act and the rules and
regulations of the SEC; that all statements of fact contained in any
such Registration Statement will be true and correct when such
Registration Statement becomes effective; and that no Registration
Statement when such Registration Statement becomes effective will
include an untrue statement of a material fact or omit 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
Distributor 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 Distributor's counsel, be
necessary or advisable. The Distributor shall promptly notify the Trust
of any advice given to it by its counsel regarding the necessity or
advisability of amending or supplementing such Registration Statement.
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 the Distributor to do so, the
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 the 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 Statements and/or supplements
to any prospectus, of whatever character, as the Trust may deem
advisable, such right being in all respects absolute and unconditional.
1.10 The Trust authorizes the Distributor to use any prospectus or statement
of additional information in the form furnished from time to time in
connection with the sale of the Shares. The Trust agrees to indemnify
and hold harmless the Distributor, its officers, directors, and
employees, and any person who controls the Distributor within the
meaning of Section 15 of the 1933 Act, free and harmless 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 legal fees incurred in connection therewith)
which the Distributor, its officers, directors, employees or any such
controlling person may incur under the 1933 Act, under any other
statute, at common law or otherwise, arising out of or based upon:
(a) any untrue statement, or alleged untrue statement, of a material
fact contained in the Trust's Registration Statement, prospectus,
statement of additional information, or sales literature (including
amendments and supplements thereto), or
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(b) any omission, or alleged omission, to state a material fact
required to be stated in the Trust's Registration Statement,
prospectus, statement of additional information or sales literature
(including amendments or supplements thereto), necessary to make the
statements therein not misleading, provided, however, that insofar as
losses, claims, damages, liabilities or expenses arise out of or are
based upon any such untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with
information furnished to the Trust by the Distributor or its affiliated
persons for use in the Trust's Registration Statement, prospectus, or
statement of additional information or sales literature (including
amendments or supplements thereto), such indemnification is not
applicable.
The Distributor, its officers, directors, and employees, and any such
controlling person, as aforesaid, shall notify the Trust of any action
brought against the Distributor, its officers, directors or employees,
or any such controlling person, such notification to be given by letter
or by telegram addressed to the Trust at its principal office in
Boston, Massachusetts 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
the Trust may have to the person against whom such action is brought by
reason of any such untrue, or allegedly untrue, statement or omission,
or alleged omission, otherwise than on account of the Trust's indemnity
agreement contained in this paragraph 1.10. The Trust will be entitled
to assume the defense of any suit brought to enforce any such claim,
demand or liability, but, in such case, such defense shall be conducted
by counsel of good standing chosen by the Trust and approved by the
Distributor, which approval shall not unreasonably be withheld. In the
event the Trust elects to assume the defense of any such suit and
retain counsel of good standing approved by the Distributor, 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
the Distributor reasonably does not approve of counsel chosen by the
Trust, or in case there is a conflict of interest between the Trust or
the Distributor, the Trust will reimburse the Distributor, its
officers, directors and employees, or the controlling person or persons
named as defendant or defendants in such suit, for the fees and
expenses of any counsel retained by the Distributor or them. The
Trust's indemnification agreement contained in this paragraph 1.10 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 the Distributor, its officers,
directors and employees, or any controlling person, and shall survive
the delivery of any Shares. This agreement of indemnity will inure
exclusively to the Distributor's benefit, to the benefit of its several
officers, directors and employees, and their respective estates, and to
the benefit of the controlling persons and their successors. The Trust
agrees promptly to notify the Distributor of the commencement of any
litigation or proceedings against the Trust or any of its officers or
trustees in connection with the issue and sale of any Shares.
1.11 The Distributor agrees to indemnify and hold harmless the Trust, its
several officers and trustees and each person, if any, who controls a
Fund within the meaning of Section 15 of the 1933 Act against any loss,
claims, damages, liabilities and expenses (including the cost of any
reasonable legal fees incurred in connection therewith) which the
Trust, its officers, trustees or any such controlling person may incur
under the 1933 Act, under any other statute, at common law or
otherwise, but only to the extent that such liability or expense
incurred by the Trust, its officers or trustees, or any controlling
person resulting from such claims or demands arose out of the
acquisition of any Shares by any person which may be based upon any
untrue statement or alleged untrue statement of a material fact
contained in the Trust's Registration Statement, prospectus or
statement of additional information (including amendments and
supplements thereto), or any omission, or alleged omission, to state 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 or confirmed in writing to
the Trust by the Distributor or its affiliated persons (as defined in
the 1940 Act).
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The agreement of the Distributor to indemnify the Trust, its officers
and trustees, and any such controlling person, as aforesaid, is
expressly conditioned upon the Distributor being notified of any action
brought against the Trust, its officers or trustees, or any such
controlling person, such notification to be given by letter or telegram
addressed to the Distributor at its principal office in Westborough,
Massachusetts, and sent to the 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 Distributor shall have the
right of first control of the defense of such action, with counsel of
its own choosing, satisfactory to the Trust, if such action is based
solely upon such alleged misstatement or omission on the Distributor's
part, and in any other event the Trust, it officers or trustees or such
controlling person shall each have the right to participate in the
defense or preparation of the defense of any such action. The failure
so to notify the Distributor of any such action shall not relieve the
Distributor from any liability that the Distributor may have to the
Trust, its officers or trustees, or to such controlling person by
reason of any such untrue, or alleged untrue, statement or omission, or
alleged omission, otherwise than on account of the Distributor's
indemnity agreement contained in this paragraph 1.11.
1.12 No Shares shall be offered by either the 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 effectiveness of the Registration Statement then in effect or
any necessary amendments thereto shall be suspended under any of the
provisions of the 1933 Act, or if and so long as a current prospectus
as required by Section 5(b)(2) of said Act is not on file with the SEC;
provided, however, that nothing contained in this paragraph 1.12 shall
in any way restrict or have any application to or bearing upon the
Trust's obligation to repurchase Shares from any shareholder in
accordance with the provisions of the Trust's Registration Statement,
Declaration of Trust, or bylaws.
1.13 The Trust agrees to advise the Distributor as soon as reasonably
practical by a notice in writing delivered to the Distributor:
(a) of any request by the SEC for amendments to the Registration
Statement, prospectus or statement of additional information then in
effect or for additional information;
(b) in the event of the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement, prospectus
or statement of additional information 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, prospectus or
statement of additional information then in effect or that requires the
making of a change in such Registration Statement, prospectus or
statement of additional information in order to make the statements
therein not misleading; and
(d) of all actions of the SEC with respect to any amendments to any
Registration Statement, prospectus or statement of additional
information which may from time to time be filed with the SEC.
For purposes of this section, informal requests by or acts of the Staff
of the SEC shall not be deemed actions of or requests by the SEC.
1.14 The Distributor agrees on behalf of itself and its directors, officers
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 by the Trust, which approval shall not be unreasonably
withheld and may not be withheld where the 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.
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1.15 The Distributor shall provide the following sales support services to
the Trust: (i) sales literature review and recommendations for
compliance with NASD and SEC rules and regulations; (ii) preparation of
training materials for use by personnel of the Trust; (iii) preparation
of ongoing compliance updates; (iv) provision of advice and counsel to
the Trust with respect to regulatory matters, including monitoring
regulatory and legislative developments that may affect the Trust; and
(v) assistance in the preparation of quarterly board materials with
regard to sales and other distribution related data reasonably
requested by the board.
2. TERM
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This Agreement shall become effective immediately upon the consummation
of the acquistion of Provident Distributors, Inc. by PFPC Inc. (or a
substantially similar transaction), which the parties anticipate to
occur on or about December 31, 2000 (the "Effective Date") and, unless
sooner terminated as provided herein, shall continue for an initial
two-year term and thereafter shall be renewed for successive one-year
terms, provided such continuance is specifically approved at least
annually by (i) the Trust's Board of Trustees or (ii) by a vote of a
majority (as defined in the 0000 Xxx) of the outstanding voting
securities of the Trust, provided that in either event the continuance
is also approved by a majority of the Trustees who are not parties to
this Agreement and who are not interested persons (as defined in the
0000 Xxx) of any party to this Agreement, by vote cast in person at a
meeting called for the purpose of voting on such approval. This
Agreement is terminable with respect to the Trust without penalty, on
at least sixty days' written notice, by the Trust's Board of Trustees,
by vote of a majority (as defined in the 0000 Xxx) 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
defined in the 1940 Act).
3. LIMITATION OF LIABILITY
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(a) The Distributor shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Trust in connection with
the performance of its obligations and duties under this Agreement,
except a loss resulting from the Distributor's willful misfeasance, bad
faith or negligence in the performance of such obligations and duties,
or by reason of its reckless disregard thereof. The Trust will
indemnify the Distributor against and hold it harmless from any and all
losses, claims, damages, liabilities or expenses (including reasonable
counsel fees and expenses) resulting from any claim, demand, action or
suit not resulting from the willful misfeasance, bad faith or
negligence of the Distributor in the performance of such obligations
and duties or by reason of its reckless disregard thereof; provided,
however, that as to any matter disposed of by a compromise payment by
the Distributor, pursuant to a consent decree or otherwise, no
indemnification either for such payment or for any other expenses shall
be provided unless there has been a determination that the Distributor
did not engage in willful misfeasance, bad faith or negligence or
reckless disregard of the performance of its obligations and duties (i)
by the court or other body approving the settlement or other
disposition; or (ii) based upon a review of readily available facts (as
opposed to a full trial-type inquiry), by written opinion from
independent legal counsel approved by the Board of Trustees; or (iii)
by a majority of the Board of Trustees who are neither interested
persons of the Trust (as defined in the 0000 Xxx) nor parties to the
matter, based upon a review of readily available facts (as opposed to a
full trial-type inquiry).
(b) In no event and under no circumstances shall either party to this
Agreement be liable to the other party for consequential or indirect
loss of profits, reputation or business or any other special damages
under any provision of this Agreement or for any act or failure to act
hereunder.
4. NOTICES
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All notices and other communications (collectively referred to as a
"Notice" or "Notices" in this paragraph) hereunder shall be in writing
or by telegram, cable, telex or facsimile sending device. Notices shall
be addressed (a) if to the Distributor at its address, 400 Bellevue
Parkway, Wilmington, Delaware
103
19809; (b) if to the Trust, at its principal place of business or (c)
if to neither of the foregoing, at such other address as to which the
sender shall have been notified by any such Notice or other
communication. The Notice may be sent by first-class mail, in which
case it shall be deemed to have been given three days after it is sent,
or if sent by telegram, cable, telex or facsimile sending device, it
shall be deemed to have been given immediately.
5. FURTHER ACTIONS
---------------
Each party agrees to perform such further acts and execute such further
documents as are necessary to effectuate the purposes hereof.
6. AMENDMENTS
----------
This Agreement or any part hereof may be changed or waived only by an
instrument in writing signed by the party against which enforcement of
such change or waiver is sought.
7. GOVERNING STATE LAW
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This Agreement shall be governed by and its provisions shall be
construed in accordance with the laws of the State of Delaware.
8. MATTERS RELATING TO THE TRUST AS A MASSACHUSETTS BUSINESS TRUST
---------------------------------------------------------------
The names "Pictet Funds" and "Trustees of Pictet Funds" refer
respectively to the Trust created and the Trustees, as trustees but not
individually or personally, acting from time to time under a
Declaration of Trust dated as of May 23, 1995 to which reference is
hereby made and a copy of which is on file at the office of the
Secretary of the Commonwealth of Massachusetts and elsewhere as
required by law, and to any and all amendments thereto so filed or
hereafter filed. The obligations of "Pictet Funds" entered into in the
name or on behalf thereof by any of the Trustees, representatives or
agents are made not individually, but in such capacities, and are not
binding upon any of the Trustees, Shareholders or representatives of
the Trust personally, but bind only the assets of the Trust, and all
persons dealing with a Fund must look solely to the assets of the Trust
belonging to such Fund for the enforcement of any claims against the
Trust.
9. MISCELLANEOUS
-------------
This Agreement embodies the entire agreement and understanding between
the parties hereto, and supersedes all prior agreements and
understandings relating to the subject matter thereof. 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 or effect. 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. This Agreement shall be binding and shall inure to the benefit
of the parties hereto and their respective successors.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
PICTET FUNDS
By:/s/Xxxx X. Xxxxxxx
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Title:Chairman & President
--------------------
PFPC DISTRIBUTORS, INC.
By:/s/Xxxx X. Xxxxxxx
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Title:/s/President
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SCHEDULE A
to the Distribution Agreement
between Pictet Funds and
PFPC Distributors, Inc.
Name of Series
--------------
Pictet Global Emerging Markets Fund
Pictet International Small Companies Fund
Pictet Eastern European Fund
Pictet European Equity Fund
Pictet International Equity Fund
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