Form 485BPOS HSBC FUNDS

Exhibit (d)(1)(v)

INVESTMENT ADVISORY CONTRACT SUPPLEMENT

HSBC Funds
4249 Easton Way, Suite 400

Columbus, Ohio  43219

 

March 24, 2021

 

HSBC Global Asset Management (USA) Inc.
452 Fifth Avenue
7th Floor
New York, NY 10018

Dear Sirs:

Re:

HSBC ESG Prime Money Market Fund

     This will confirm the agreement between the undersigned (the “Trust”) and HSBC Global Asset Management (USA) Inc. (the “Adviser”) as follows:

     1. The Trust is an open-end management investment company organized as a Delaware statutory trust and consists of such separate investment portfolios as have been or may be established by the Trustees of the Trust from time to time. A separate series of shares of beneficial interest of the Trust is offered to investors with respect to each investment portfolio. HSBC ESG Prime Money Market Fund (the “Fund”) is a separate investment portfolio of the Trust.

     2. The Trust and the Adviser have entered into an Investment Advisory Contract dated June 24, 2016 (“Advisory Contract”) pursuant to which the Trust has employed the Adviser to provide investment advisory and other services specified in the Advisory Contract and the Adviser has accepted such employment. Terms used but not otherwise defined herein shall have the same meanings assigned to them by the Advisory Contract.

     3. As provided in paragraph 1 of the Advisory Contract, the Trust hereby adopts the Advisory Contract with respect to the Fund and the Adviser hereby acknowledges that the Advisory Contract shall pertain to the Fund, the terms and conditions of the Advisory Contract being hereby incorporated herein by reference.

     4. The term “Covered Fund” as used in the Advisory Contract shall, for purposes of this Supplement, pertain to the Fund.

     5. As provided in paragraph 6 of the Advisory Contract and subject to further conditions as set forth therein, the Trust shall with respect to the Fund pay the Adviser a monthly fee on the first business day of each month at the annual rate of 0.10% of the average daily value (as determined on each business day at the time set forth in the Prospectus for determining net asset value per share) of the net assets of the Fund during the preceding month.

     6. This Supplement and the Advisory Contract (together, the “Contract”) shall become effective with respect to the Fund as of March 24, 2021 and shall continue in effect with respect to the Fund for an initial term of two years, and shall continue in effect thereafter only so long as the continuance is specifically approved at least annually (a) by the vote of a majority of the outstanding voting securities of the Fund (as defined in the 1940 Act) or by the Board of Trustees and (b) by the vote, cast in person at a meeting called for that purpose, of a majority of the members of the Board of Trustees who are not parties to this Contract or “interested persons” (as defined in the 1940

Act) of any such party. This Contract may be terminated with respect to the Fund at any time, without the payment of any penalty, by vote of a majority of the outstanding voting securities of the Fund (as defined in the 1940 Act) or by a vote of a majority of the members of the Board of Trustees on 60 days’ written notice to the Adviser, or by the Adviser on 60 days’ written notice to the Trust. This Contract shall terminate automatically in the event of its assignment as defined in the 1940 Act.

     If the foregoing correctly sets forth the agreement between the Trust and the Adviser, please so indicate by signing and returning to the Trust the enclosed copy hereof.

Very truly yours,

HSBC FUNDS

By:	/s/Stefano R. Michelagnoli
	Name:	Stefano R. Michelagnoli
	Title:	President

ACCEPTED:

HSBC GLOBAL ASSET MANAGEMENT (USA) INC.

 

By:	/s/Paul Dawe
	Name:	Paul Dawe
	Title:	Chief Operating Officer and Chief Executive Officer

 

 

Exhibit (e)(5)

THIRD AMENDMENT TO

DISTRIBUTION AGREEMENT

 

 

This third amendment (“Amendment”) to the Distribution Agreement (the “Agreement”) dated as of May 31^st, 2017, by and between HSBC Funds (the “Trust”) and Foreside Distribution Services, L.P. (the “Distributor” and collectively with the Trust, the “Parties”) is entered into as of March 24, 2021 (the “Effective Date”).

 

WHEREAS, the Parties desire to amend Exhibit A of the Agreement to reflect an updated list of Funds; and

 

WHEREAS, pursuant to Section 16 of the Agreement all amendments shall be made by written instrument and signed by the parties hereto;

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:

 

1.

Capitalized terms not otherwise defined herein shall have the meanings set forth in the Agreement.

 

2.

Exhibit A to the Distribution Agreement is hereby deleted in its entirety and replaced by Exhibit A attached hereto.

 

3.

Except as expressly amended hereby, all of the provisions of the Agreement shall remain unamended and in full force and effect to the same extent as if fully set forth herein.

 

4.

This Amendment shall be governed by, and the provisions of this Amendment shall be construed and interpreted under and in accordance with, the laws of the State of Delaware.

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed in their names and on their behalf by and through their duly authorized officers, as of Effective Date.

 

HSBC FUNDS

FORESIDE DISTRIBUTION SERVICES, L.P.

 

 

 

By:  /s/Stefano R. Michelagnoli	By:  /s/Mark Fairbanks
Name:  Stefano R. Michelagnoli	Name: Mark Fairbanks
Title:     President	Title:  Vice President

 

 

EXHIBIT A

Fund Names

HSBC Opportunity Fund

HSBC Opportunity Portfolio

HSBC Opportunity Fund (Class I)

HSBC U.S. Government Money Market Fund

HSBC U.S. Treasury Money Market Fund

HSBC ESG Prime Money Market Fund

 

 

Exhibit (g)(4)

 

SCHEDULE B

 

FUNDS SUBJECT TO THIS AGREEMENT

 

 

 

Name of Portfolio	Effective Date
HSBC U.S. Government Money Market Fund	April 13, 2007
HSBC U.S. Treasury Money Market Fund	April 13, 2007
HSBC ESG Prime Money Market Fund	March 24, 2021

 

 

 

Acceptance of Schedule (updated March 24, 2021)

 

 

/s/Stefano R. Michelagnoli		/s/Chad K. Hecht
HSBC Funds		Northern Trust
President		Vice President
Title		Title

 

 

SCHEDULE B-1

 

 

FUNDS SUBJECT TO THIS AGREEMENT

 

 

Name of Portfolio	Effective Date
HSBC Opportunity Portfolio	February 1, 2007

 

 

 

Acceptance of Schedule (updated March 24, 2021)

/s/Stefano R. Michelagnoli		/s/Chad K. Hecht
HSBC Funds		Northern Trust
President		Vice President
Title		Title

 

 

 

Exhibit (h)(1)

OPERATIONAL SUPPORT SERVICES AGREEMENT

HSBC Funds

March 24, 2021

 

THIS OPERATIONAL SUPPORT SERVICES AGREEMENT (“Agreement”) is made between HSBC Global Asset Management (USA), Inc. (“Adviser”) and HSBC Funds (“Trust”) on behalf of its series, HSBC U.S. Government Money Market Fund, HSBC U.S. Treasury Money Market Fund and HSBC ESG Prime Money Market Fund (each, a “Fund” and collectively, the “Funds”).

WHEREAS, the Trust is a registered open-end investment company organized as a Delaware statutory trust and currently consists of multiple separate series;

WHEREAS, the Adviser has entered into an investment advisory contract with the Trust to provide advisory services to the Funds (the “Advisory Agreement”);

WHEREAS, the Adviser has agreed to provide in addition to the purely investment advisory services provided pursuant to the Advisory Agreement, certain administrative and operational support services in connection with the operation of the Funds;

NOW, THEREFORE, in consideration of the mutual promises herein made, the parties hereby agree as follows:

1.

The Adviser agrees to provide the following operational support services to the Funds:

(i)

manage and coordinate the Funds’ operations, including the development of new product features and benefits;

(ii)

compile statistical and research data required for the preparation of reports and statements which are periodically distributed to the Funds’ officers and Trustees;

(iii)

handle general inquiries from account representatives, such as advice as to the status of shareholder accounts, the current yield and dividends declared to date and provide assistance with other questions related to shareholder accounts;

(iv)

provide support to account representatives regarding Fund benefits and features;

(v)

provide operational assistance to account representatives regarding opening new accounts, closing accounts and making changes to the set-up of existing accounts;

(vi)

assist in the development and ongoing operation of “sweep” accounts utilizing the Funds;

(vii)

compile information required in connection with the Funds’ filings with the Securities and Exchange Commission; and

(viii)

provide such other services as agreed upon by both parties.

2.

For its services, the Adviser shall be entitled to a fee (the “Operational Support Fee”) from each Fund’s Class A, Class C, Class D, Class Y, Intermediary Class and Intermediary Service Class shares (as applicable), computed daily and paid monthly, equal on an annual basis to the percentage of each Fund’s average daily net assets set forth on Schedule A, as in effect from time to time. The Adviser, in its sole discretion, may waive all or any part the Operational Support Fee for any class of shares of a Fund.

3.

This Agreement shall remain in full force and effect through December 31, 2021, and thereafter from year to year to the extent continuance is approved annually by the Board of Trustees of the Trust.

4.

This Agreement may be amended or modified from time to time by both parties in writing.

5.

This Agreement may be terminated by the Trust at any time on sixty (60) days’ written notice without payment of penalty, provided that such termination by the Trust shall be directed or approved by the vote of a majority of the Trustees of the Trust in office at the time or by the vote of a majority of the outstanding voting securities of the Trust as defined by the Investment Company Act of 1940 Act (“1940 Act”); and shall automatically and immediately terminate in the event of its assignment as defined by the 1940 Act.

6.

In the absence of willful misfeasance, bad faith or gross negligence on the part of the Adviser, or of reckless disregard of its duties and obligations hereunder, the Adviser shall not be subject to liability for any act or omission in the course of, or connected with, rendering services hereunder.

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers, and their respective corporate seals to be hereunto duly affixed and attested.

HSBC FUNDS

 

 

 

	By:	/s/Stefano R. Michelagnoli
	Name:	Stefano R. Michelagnoli
	Title:	President

 

 

 

HSBC GLOBAL ASSET MANAGEMENT (USA) INC.

 

 

 

	By:	/s/Paul Dawe
	Name:	Paul Dawe
	Title:	Chief Operating Officer and Chief Executive Officer

 

SCHEDULE A
to OPERATIONAL SUPPORT SERVICES AGREEMENT
dated as of March 24, 2021

 

Fund	Operational Support Fee
U.S. Government Money Market Fund	0.10%
U.S. Treasury Money Market Fund	0.10%
ESG Prime Money Market Fund	0.10%

 

 

 

Exhibit (h)(6)

 

HSBC FUNDS

 

EXPENSE LIMITATION AGREEMENT

 

EXPENSE LIMITATION AGREEMENT, effective as of March 24, 2021, by and between HSBC Global Asset Management (USA) Inc. (the “Investment Manager”) and HSBC Funds (the “Trust”), on behalf of each of its series set forth in Schedule A hereto (each, a “Fund”).

WHEREAS, the Trust is a Delaware statutory trust, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management company of the series type, and each Fund is a series of the Trust; and

WHEREAS, the Trust and the Investment Manager have entered into an Investment Management Agreement (the “Management Agreement”), pursuant to which the Investment Manager provides investment management services to each Fund for compensation based on the value of the average daily net assets of each such Fund; and

WHEREAS, the Funds may, from time to time, invest in affiliated or unaffiliated investment companies, including exchange-traded funds (ETFs), such underlying investments collectively referred to herein as “Acquired Funds”; and

WHEREAS, the Trust and the Investment Manager have determined that it is appropriate and in the best interests of each Fund and its shareholders to maintain the expenses of each Fund at a level below the level to which each such Fund may normally be subject;

NOW THEREFORE, the parties hereto agree as follows:

1.

Expense Limitation.

1.1.            Applicable Expense Limit. To the extent that the ordinary operating expenses incurred by a Fund in any fiscal year, including but not limited to investment management fees of the Investment Manager and amounts payable pursuant to a plan adopted in accordance with Rule 12b-1 under the 1940 Act (“Fund Operating Expenses”), but excluding interest, taxes, brokerage commissions, Acquired Fund fees and expenses other than estimated indirect expenses attributable to a Fund’s investments in the HSBC Opportunity Portfolio, extraordinary expenses such as litigation, and other expenses not incurred in the ordinary course of such Fund’s business, exceed the operating expense limit, as defined in Section 1.2 below (“Operating Expense Limit”), such excess amount (the “Excess Amount”) shall be the liability of the Investment Manager.

1.2.            Operating Expense Limit. The maximum Operating Expense Limit in any year with respect to each Fund shall be the amount specified in Schedule A based on a percentage of the average daily net assets of each Fund.

1.3.            Duration of Operating Expense Limit. The Operating Expense Limit with respect to each Fund shall remain in effect until the date specified for that Fund on Schedule B. The Investment Manager may extend, but may not during the term of this Agreement shorten without the consent of the Trust, the duration of the Operating Expense Limit for any Fund by delivering a revised Schedule

B to the Trust reflecting such extension. Such an extension must continue at the same Operating Expense Limit amount specified on Schedule A.

1.4.            Method of Computation. To determine the Investment Manager's obligation with respect to the Excess Amount, each day the Fund Operating Expenses for each Fund shall be estimated and accrued. Each day, the Fund shall also calculate a year-to-date Operating Expense Limit Amount (“Operating Expense Limit Amount”), based on each Fund's year to date average net assets and its Operating Expense Limit. If the total year-to-date expenses exceed the year to date Operating Expense Limit Amount, the Fund shall record a receivable from the Investment Manager in an amount equal to the year-to-date Excess Amount less any such receivables previously recorded for the fiscal period. Shortly after the end of each month, the Fund shall deliver to the Investment Manager a statement indicating the Excess Amount owed to the Fund for the month and the Investment Manager will remit to the Fund an amount that, together with any waived or reduced investment management fee, is sufficient to pay that monthly Excess Amount.

1.5.            Year-End Adjustment. If necessary, on or before the last day of the first month of each fiscal year, an adjustment payment shall be made by the appropriate party in order that the amount of the investment management fees waived or reduced and other payments remitted by the Investment Manager to the Fund or Funds with respect to the previous fiscal year shall equal the Excess Amount.

2.

Reimbursement of Fee Waivers and Expense Reimbursements.

2.1.            Reimbursement. If on any day during which the Management Agreement is in effect, the estimated annualized Fund Operating Expenses of such Fund for that day are less than the Operating Expense Limit, the Investment Manager shall be entitled to reimbursement by such Fund of the investment management fees waived or reduced and other payments remitted by the Investment Manager to such Fund pursuant to Section 1 hereof (the “Reimbursement Amount”) during any of the previous thirty-six (36) months, to the extent that the Fund’s annualized Operating Expenses plus the amount so reimbursed equals, for such day, the Operating Expense Limit provided in Schedule A, provided that such amount paid to the Investment Manager will in no event exceed the total Reimbursement Amount and will not include any amounts previously reimbursed.

2.2.            Year-End Adjustment. If necessary, on or before the last day of the first month of each fiscal year, an adjustment payment shall be made by the appropriate party in order that the actual Fund Operating Expenses of a Fund for the prior fiscal year (including any reimbursement payments hereunder with respect to such fiscal year) do not exceed the Operating Expense Limit.

3.

Term and Termination of Agreement.

This Agreement shall terminate, without payment of any penalty, upon: (1) termination of the Management Agreement or (2) written notice to the Investment Manager by the Trust.

4.

Miscellaneous.

4.1.            Captions. The captions in this Agreement are included for convenience of reference only and in no other way define or delineate any of the provisions hereof or otherwise affect their construction or effect.

4.2.            Interpretation. Nothing herein contained shall be deemed to require the Trust or the Funds to take any action contrary to the Trust’s Agreement and Declaration of Trust or By-Laws, or any applicable statutory or regulatory requirement to which it is subject or by which it is bound, or to relieve or deprive the Trust’s Board of Trustees of its responsibility for and control of the conduct of the affairs of the Trust or the Funds.

4.3.            Definitions. Any question of interpretation of any term or provision of this Agreement, including but not limited to the investment management fee, the computations of net asset values, and the allocation of expenses, having a counterpart in or otherwise derived from the terms and provisions of the Management Agreement or the 1940 Act, shall have the same meaning as and be resolved by reference to such Management Agreement or the 1940 Act.

IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by their respective officers thereunto duly authorized and their respective corporate seals to be hereunto affixed, as of March 24, 2021.

	HSBC FUNDS
	ON BEHALF OF
	EACH OF ITS SERIES SET FORTH IN SCHEDULE A

	By:	/s/Stefano R. Michelagnoli
	Name:	Stefano R. Michelagnoli
	Title:	President

 

 

HSBC GLOBAL ASSET MANAGEMENT (USA) INC.

	By:	/s/Paul Dawe
	Name:	Paul Dawe
	Title:	Chief Operating Officer and Chief Executive Officer

 

 

 

 

SCHEDULE A

 

OPERATING EXPENSE LIMITS

This Agreement relates to the following:

 

Name of Fund	Maximum Operating Expense Limit (as a percentage of average net assets)
HSBC ESG Prime Money Market Fund	Class I Shares:	0.14%
	Intermediary Shares:	0.18%
	Intermediary Service Shares:	0.20%

SCHEDULE B

 

DURATION OF OPERATING EXPENSE LIMITS

The duration of each Operating Expense Limit shall be as follows:

Name of Fund	Date on Which Operating Expense Limit Terminates
HSBC ESG Prime Money Market Fund	March 1, 2023

 

 

Exhibit (h)(9)

AMENDMENT TO
ADMINISTRATION SERVICES AGREEMENT

 

THIS AMENDMENT dated as of the 24th day of March, 2021 (the "Amendment"), to that certain Administration Services Agreement, dated June 24, 2016 (the "Agreement") by and between HSBC Global Asset Management (USA) Inc. ("HSBC"), a New York corporation, and HSBC Funds (the "Trust"), on behalf of the individual series listed on Schedule A to the Agreement. All Capitalized terms not defined herein shall have the meanings given to them in the Agreement.

 

WHEREAS, pursuant to the Agreement HSBC provides certain administration services to the Company and its investment portfolios; and

 

WHEREAS, the parties desire to amend the Agreement pursuant to this Amendment to update the Fund names listed on Schedule A;

 

NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter contained and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, HSBC and the Company hereby agree as follows:

 

1.

Amendment to Schedule A

 

Schedule A of the Agreement is hereby deleted in its entirety and replaced with the Schedule A attached to the end of this Amendment.

 

2.

Representations and Warranties.

 

(a)               HSBC represents (i) that it has full power and authority to enter into and perfom1 this Amendment (ii) that the transactions contemplated by this Amendment, and all information relating thereto has been presented to and reviewed by the Board of Trustees of the Trust and (iii) that the Board has approved the transactions contemplated by this Amendment.

 

(b)               The Trust represents that it has full power and authority to enter into and perform this Amendment.

 

3.

Effective Date.

 

The effective date of this Amendment shall be March 24, 2021.

 

4.

Miscellaneous.

 

(a)               This Amendment supplements and amends the Agreement. The provisions set forth in this Amendment supersede all prior negotiations, understandings and agreements bearing

 

upon the subject matter covered herein, including any conflicting provisions of the Agreement or any provisions of the Agreement that directly cover or indirectly bear upon matters covered under this Amendment.

 

(b)               Each reference to the Agreement in the Agreement (as it existed prior to this Amendment) and in every other agreement, contract or instrument to which the parties are bound, shall hereafter be construed as a reference to the Agreement as amended by this Amendment. Except as provided in this Amendment, the provisions of the Agreement remain in full force and effect. No amendment or modification to this Amendment shall be valid unless made in writing and executed by both parties hereto.

 

(c)               Paragraph headings in this Amendment are included for convenience only and are not to be used to construe or interpret this Amendment.

 

(d)               This Amendment may be executed in counterparts, each of which shall be an original but all of which, taken together, shall constitute one and the same agreement.

 

 

[SIGNATURE PAGE FOLLOWS]

 

* * * * *

 

SCHEDULE A

 

TO THE ADMINISTRATION SERVICES AGREEMENT

 

Dated as of March 24, 2021

 

Funds

 

 

HSBC Funds

 

NON-MONEY MARKET FUNDS

HSBC Opportunity Fund
HSBC Opportunity Portfolio

HSBC Opportunity Fund (Class I)

MONEY MARKET FUNDS

HSBC U.S. Government Money Market Fund
HSBC U.S. Treasury Money Market Fund

HSBC ESG Prime Money Market Fund

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed all as of the day and year first above written.

 

HSBC GLOBAL ASSET MANAGEMENT (USA) INC.

 

 

	By:	/s/Paul Dawe
	Name:	Paul Dawe
	Title:	Chief Operating Officer and Chief Executive Officer

 

 

HSBC FUNDS

 

	By:	/s/Stefano R. Michelagnoli
	Name:	Stefano R. Michelagnoli
	Title:	President

 

 

Exhibit (i)

 

1900 K Street, N.W. Washington, DC 20006 +1 202 261 3300 Main +1 202 261 3333 Fax www.dechert.com

August 13, 2021

HSBC Funds 452 Fifth Avenue New York, New York 10018

Re:

HSBC Funds (File Nos. 033-07647 and 811-04782)

 

Ladies and Gentlemen:

We have acted as counsel to HSBC Funds, a Delaware statutory trust (the “Trust”), and the HSBC ESG Prime Money Market Fund (the “Fund”) in connection with the filing of Post-Effective Amendment No. 284 to the Trust’s registration statement (the “Registration Statement”) under the Investment Company Act of 1940, as amended (the “1940 Act”) and the Securities Act of 1933 (the “1933 Act”), as amended, and in connection with the issuance and sale by the Trust of the Fund’s shares proposed to be sold pursuant to Post-Effective Amendment No. 284 to the Registration Statement (the “Shares”).

This opinion is limited to the Delaware Statutory Trust Act, and we express no opinion with respect to the laws of any other jurisdiction or to any other laws of the State of Delaware. Further, we express no opinion as to compliance with any state or federal securities laws, including the securities laws of the State of Delaware.

We have examined the Trust’s Amended and Restated Agreement and Declaration of Trust (“Declaration of Trust”), the Trust’s By-Laws, and other Trust records, certificates, documents and matters as we have deemed necessary to enable us to give this opinion. In addition, we have reviewed and relied upon a certificate of good standing issued by the Delaware Secretary of State.

In rendering this opinion we have assumed, without independent verification: (i) the due authority of all individuals signing in representative capacities and the genuineness of signatures; (ii) the authenticity, completeness and continued effectiveness of all documents

 

or copies furnished to us; (iii) that any resolutions provided have been duly adopted by the Trust’s Board of Trustees; (iv) that the facts contained in the instruments and certificates or statements of public officials, officers and representatives of the Trust on which we have relied for the purposes of this opinion are true and correct; and (v) that no amendments, agreements, resolutions or actions have been approved, executed or adopted which would limit, supersede or modify the items described above. Where documents are referred to in resolutions approved by the Trust’s Board of Trustees, or in the Registration Statement, we have assumed such documents are the same as in the most recent form provided to us, whether as an exhibit to the Registration Statement or otherwise.

Based upon the foregoing, we are of the opinion that the Fund’s Shares have been validly authorized, and, when sold in accordance with the terms of the Registration Statement and the requirements of applicable federal and state law, will have been legally and validly issued and, subject to the qualifications set forth in the Declaration of Trust, will be fully paid and non-assessable.

We note that, pursuant to Section 4.5 of Article IV of the Declaration of Trust, the Trustees have the power, as frequently as they may determine, to cause each shareholder of any particular of any particular series or class, to pay directly, in advance or arrears, for charges of the Trust’s transfer, shareholder servicing or similar agent, an amount fixed from time to time by the Trustees, by setting off such charges due from such shareholder from declared but unpaid dividends owed such shareholder and/or by reducing the number of shares in the account of such shareholder by that number of full and/or fractional shares which represents the outstanding amount of such charges due from such shareholder.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement, to be filed with the Securities and Exchange Commission in connection with the continuous offering of the Fund’s shares of beneficial interest, as indicated above, and to references to our firm, as counsel to the Trust, in the Registration Statement and in any revised or amended versions thereof, until such time as we revoke such consent. In giving such consent, however, we do not admit that we are within the category of persons whose consent is required by Section 7 of the 1933 Act or the rules and regulations thereunder.

Very truly yours,

 

/s/ Dechert LLP

 

Dechert LLP

 

Exhibit (n)

MULTIPLE CLASS PLAN PURSUANT TO RULE 18f-3

FOR

HSBC FUNDS

 

WHEREAS, HSBC Funds, a Delaware statutory trust (the “Trust”), engages in business as an open-end management investment company and is registered as such under the Investment Company Act of 1940, as amended (the “1940 Act”);

WHEREAS, shares of beneficial interest of the Trust are currently divided into multiple separate series, including the HSBC U.S. Government Money Market Fund, HSBC U.S. Treasury Money Market Fund and HSBC ESG Prime Money Market Fund (collectively, the “Money Market Funds”), HSBC Opportunity Fund and HSBC Opportunity Portfolio (each, a “Fund” and collectively, the “Funds”).

WHEREAS, the Trust desires to adopt, on behalf of each of the Funds, a Multiple Class Plan pursuant to Rule 18f-3 under the 1940 Act (the “Plan”) with respect to each of the Funds;

NOW, THEREFORE, the Trust hereby adopts, on behalf of the Funds, the Plan, in accordance with Rule 18f-3 under the 1940 Act on the following terms and conditions:

1.       Features of the Classes. Each of the HSBC U.S. Government Money Market Fund and HSBC U.S. Treasury Money Market Fund issues its shares of beneficial interest in eight classes: “Class A Shares,” “Class C Shares,” “Class D Shares,” “Class Y Shares,” “Class I Shares,” “Class E Shares,” “Intermediary Class Shares” and/or “Intermediary Service Class Shares.” The HSBC ESG Prime Money Market Fund issues its shares of beneficial interest in five classes: “Class D Shares”, “Class Y Shares”, “Class I Shares”, “Intermediary Class Shares” and/or “Intermediary Service Class Shares.” The HSBC Opportunity Fund issues its shares of beneficial interest in two classes: “Class A Shares” and “Class C Shares. The HSBC Opportunity Fund (Class I) issues its shares of beneficial interest in one class: “Class I Shares.” The HSBC Opportunity Portfolio issues its shares of beneficial interest in one class: “Master Portfolio Shares.”

The Shares of each class of a Fund shall represent an equal pro rata interest in such Fund and, generally, shall have identical voting, dividend, liquidation, and other rights, preferences, powers, restrictions, limitations, qualifications and terms and conditions, except that: (a) each class shall have a different designation; (b) each class of shares shall bear any Class Expenses, as defined in Section 4(b) below; and (c) each class shall have exclusive voting rights on any matter submitted to shareholders that relates solely to its distribution arrangement and each class shall have separate voting rights on any matter submitted to shareholders in which the interests of one class differ from the interests of any other class. In addition, the share classes shall have the features described in Sections 2, 3 and 5 below.

2.       Sales Charge Structure.

(a)       Class A Shares. Class A shares of a Fund (except the Money Market Funds) shall be offered at the then-current net asset value plus a front-end sales charge. The front-end sales charge shall be in such amount as is disclosed in each Fund’s current prospectus

or prospectus supplement and shall be subject to reductions for larger purchases and such waivers or reductions as are determined or approved by the Board of Trustees. Class A shares of each Money Market Fund shall be offered at net asset value without the imposition of a front-end sales charge. Class A shares shall not be subject to a contingent deferred sales charge except that such a charge may be imposed in such cases as the Board of Trustees may approve and as is disclosed in a Fund’s current prospectus or supplement thereto.

(b)       Class C Shares. Class C shares of a Fund shall be offered at the then-current net asset value without the imposition of a front-end sales charge. A contingent deferred sales charge in such amount as is described in each Fund’s current prospectus or prospectus supplement shall be imposed on Class C shares subject to such waivers or reductions as are determined or approved by the Board of Trustees.

(c)       Class D Shares. Class D shares of a Money Market Fund shall be offered at the then-current net asset value without the imposition of a front-end sales charge. Class D shares shall not be subject to a contingent deferred sales charge except that such a charge may be imposed in such cases as the Board of Trustees may approve and as is disclosed in a Fund’s current prospectus or supplement thereto.

(d)       Class Y Shares. Class Y shares of a Money Market Fund shall be offered at the then-current net asset value without the imposition of a front-end sales charge or a contingent deferred sales charge.

(e)       Class I Shares. Class I shares of a Fund shall be offered at the then-current net asset value without the imposition of a front-end sales charge or a contingent deferred sales charge.

(f)       Class E Shares. Class E shares of a Money Market Fund shall be offered at the then-current net asset value without the imposition of a front-end sales charge or a contingent deferred sales charge.

(g)       Intermediary Class Shares. Intermediary Class shares of a Money Market Fund shall be offered at the then-current net asset value without the imposition of a front-end sales charge or a contingent deferred sales charge.

(h)       Intermediary Service Class Shares. Intermediary Service Class shares of a Money Market Fund shall be offered at the then-current net asset value without the imposition of a front-end sales charge or a contingent deferred sales charge.

(i)       Master Portfolio Shares. Master Portfolio shares of the HSBC Opportunity Portfolio shall be offered at the then-current net asset value without the imposition of a front-end sales charge or a contingent deferred sales charge.

3.       Distribution and Shareholder Services Plans.

(a)       Class A Shares. Class A shares of a Fund may be subject to the terms of the Amended and Restated Master Distribution Plan Pursuant to Rule 12b-1 for Class A Shares (“Distribution Plan”) previously adopted by the Board of Trustees pursuant to Rule 12b-1 under

the 1940 Act, and the Shareholder Services Plan previously adopted by the Board of Trustees for the existing shares of each of the Funds, as such Plans may be amended from time to time in accordance with the terms thereof and, in the case of the Distribution Plan, Rule 12b-1 under the 1940 Act. As of the date hereof, the Distribution Plan authorizes payment to the Distributor of a monthly fee at an annual rate of up to 0.25% of the average daily net assets of a Fund’s Class A shares for distribution services or service activities (each as defined in paragraph (l), below), as designated by the Distributor, and the Shareholder Services Plan authorizes payment of shareholder services fees of 0.25% of the average daily net assets of a Fund’s Class A shares. As of the date hereof, the Shareholder Services Plan shall authorize payment of a shareholder services fee of up to 0.60% of the average daily net assets of a Money Market Fund’s Class A shares.

(b)       Class C Shares. Class C shares of each Fund shall be subject to the terms of the Amended and Restated Master Distribution Plan Pursuant to Rule 12b-1 for Class C Shares (“Distribution Plan”) previously adopted by the Board of Trustees pursuant to Rule 12b-1 under the 1940 Act, and the Shareholder Services Plan previously adopted by the Board of Trustees for the existing shares of each of the Funds, as such Plans may be amended from time to time in accordance with the terms thereof and, in the case of the Distribution Plan, Rule 12b-1 under the 1940 Act. As of the date hereof, the Distribution Plan authorizes payment to the Distributor of a monthly fee at an annual rate of up to 1.00% of the average daily net assets of a Fund’s Class C shares for distribution services or service activities (each as defined in paragraph (l), below), as designated by the Distributor, and the Shareholder Services Plan authorizes payment of shareholder services fees of 0.25% of the average daily net assets of a Fund’s Class C shares.

(c)       Class D Shares. Class D shares of each Money Market Fund shall be subject to the terms of the Amended and Restated Master Distribution Plan Pursuant to Rule 12b-1 for Class D shares (“Distribution Plan”) previously adopted by the Board of Trustees pursuant to Rule 12b-1 under the 1940 Act, and the Shareholder Services Plan previously adopted by the Board of Trustees for the existing shares of each of the Funds, as such Plans may be amended from time to time in accordance with the terms thereof and, in the case of the Distribution Plan, Rule 12b-1 under the 1940 Act. As of the date hereof, the Distribution Plan authorizes payment to the Distributor of a monthly fee at an annual rate of up to 0.25% of the average daily net assets of a Fund’s Class D shares for distribution services or service activities (each as defined in paragraph (l), below), as designated by the Distributor, and the Shareholder Services Plan authorizes payment of shareholder services fees of 0.25% of the average daily net assets of a Fund’s Class D shares.

(d)       Class Y Shares. Class Y shares of each Fund shall not be subject to a Distribution and Shareholder Services Plan.

(e)       Class I Shares. Class I shares of each Fund shall not be subject to a Distribution and Shareholder Services Plan.

(f)       Class E Shares. Class E shares of each Money Market Fund shall not be subject to a Distribution Plan but shall be subject to a Shareholder Services Plan previously adopted by the Board of Trustees for the existing shares of each of the Funds, as such Plan may

be amended from time to time in accordance with the terms thereof. As of the date hereof, the Shareholder Services Plan authorizes payment of shareholder services fees of up to 0.10% of the average daily net assets of a Fund’s Class E shares.

(g)       Intermediary Class Shares. Intermediary Class shares of each Money Market Fund shall not be subject to a Distribution Plan but shall be subject to a Shareholder Services Plan previously adopted by the Board of Trustees for the existing shares of each of the Funds, as such Plan may be amended from time to time in accordance with the terms thereof. As of the date hereof, the Shareholder Service Plan authorizes payment of shareholder services fees of up to 0.05% of the average daily net assets of the Fund’s Intermediary Class Shares.

(h)       Intermediary Service Class Shares. Intermediary Service Class shares of each Money Market Fund shall not be subject to a Distribution Plan but shall be subject to a Shareholder Services Plan previously adopted by the Board of Trustees for the existing shares of each of the Funds, as such Plan may be amended from time to time in accordance with the terms thereof. As of the date hereof, the Shareholder Service Plan authorizes payment of shareholder services fees of up to 0.10% of the average daily net assets of the Fund’s Intermediary Service Class Shares.

(i)       Master Portfolio Shares. Master Portfolio shares of the HSBC Opportunity Portfolio shall not be subject to a Distribution and Shareholder Services Plan.

(j)       Distribution Services and Service Activities.

(i)       As used herein, the term “distribution services” shall include services rendered by the Distributor of the shares of a Fund in connection with any activities or expenses primarily intended to result in the sale of shares of a Fund, including, but not limited to, compensation to registered representatives or other employees of the Distributor and to other broker-dealers that have entered into an agreement with respect to distribution assistance and/or shareholder services with the Distributor; compensation to and expenses of employees of the Distributor who engage in or support distribution of the Funds’ shares; telephone expenses; interest expense; printing of prospectuses and reports for other than existing shareholders; preparation, printing and distribution of sales literature and advertising materials; and profit and overhead on the foregoing.

(ii)       As used herein, the term “service activities” shall mean activities in connection with the provision of personal, continuing services to investors in each Fund, excluding transfer agent and subtransfer agent services for beneficial owners of shares of a Fund, aggregating and processing purchase and redemption orders, providing beneficial owners with account statements, processing dividend payments, providing subaccounting services for Fund shares held beneficially, forwarding shareholder communications to beneficial owners and receiving, tabulating and transmitting proxies executed by beneficial owners; provided, however, that if the Financial Industry Regulatory Authority (“FINRA”) adopts a definition of “service fee” for purposes of Rule 2830(d) of the Conduct Rules of FINRA that differs from the definition of “service activities” hereunder, or if FINRA adopts a related definition intended to define the same concept, the definition of “service activities” in this paragraph shall be automatically amended, without further action of the Board of Trustees, to conform to such FINRA definition.

Overhead and other expenses of the Distributor related to its “service activities,” including telephone and other communications expenses, may be included in the information regarding amounts expended for such activities.

4.       Allocation of Income and Expenses.

(a)

General.

(i) Money Market Funds. The Money Market Funds, which declare distributions of net investment income daily and will maintain the same net asset value per share in each class, will allocate gross income, realized and unrealized capital gains and losses and expenses (other than Class Expenses, as defined below) to each class on the basis of relative net assets (settled shares). “Relative net assets (settled shares),” for this purpose, are net assets valued in accordance with generally accepted accounting principles but excluding the value of subscriptions receivable, in relation to the net assets of the particular Money Market Fund. Expenses to be so allocated also include expenses of the Trust that are allocated to a Fund and are not attributable to a particular Fund or class of a Fund (“Trust Expenses”) and expenses of the particular Fund that are not attributable to a particular class of the Fund (“Fund Expenses”). Trust Expenses include, but are not limited to, Trustees’ fees, insurance costs and certain legal fees. Fund Expenses include, but are not limited to, certain registration fees, advisory fees, custodial fees, and other expenses relating to the management of the Fund’s assets.

(ii) Non-Money Market Funds. The gross income, realized and unrealized capital gains and losses and expenses (other than Class Expenses, as defined below) of each Fund, other than the Money Market Funds, shall be allocated to each class on the basis of its net asset value relative to the net asset value of the Fund. Expenses to be so allocated also include expenses of the Trust that are allocated to a Fund and are not attributable to a particular Fund or class of a Fund (“Trust Expenses”) and expenses of the particular Fund that are not attributable to a particular class of the Fund (“Fund Expenses”). Trust Expenses include, but are not limited to, Trustees’ fees, insurance costs and certain legal fees. Fund Expenses include, but are not limited to, certain registration fees, advisory fees, custodial fees, and other expenses relating to the management of the Fund’s assets.

 

(b)         Class Expenses. Expenses attributable to a particular class (“Class Expenses”) shall be limited to: (a) payments pursuant to the Distribution Plan and Shareholder Services Plan adopted by that class; (b) transfer agent fees attributable to that class; (c) printing and postage expenses related to preparing and distributing material such as shareholder reports, prospectuses and proxy materials to current shareholders of that class; (d) registration fees for shares of that class; (e) the expense of administrative personnel and services as required to support the shareholders of that class; (f) litigation or other legal expenses relating solely to that class; and (g) Trustees’ fees incurred as a result of issues relating to that class. Expenses described in (a) of this paragraph must be allocated to the class for which they are incurred. All other expenses described in this paragraph may be allocated as Class Expenses, but only if the Trust’s President and Treasurer have determined, subject to Board of Trustee approval or ratification, which of such categories of expenses will be treated as Class Expenses, consistent with applicable legal principles under the 1940 Act and the Internal Revenue Code of 1986, as amended (“Code”).

In the event a particular expense is no longer reasonably allocable by class or to a particular class, it shall be treated as a Trust Expense or Fund Expense, and in the event a Trust Expense or Fund Expense becomes allocable at a different level, including as a Class Expense, it shall be so allocated, subject to compliance with Rule 18f-3 and to approval or ratification by the Board of Trustees.

The initial determination of expenses that will be allocated as Class Expenses and any subsequent changes thereto shall be reviewed by the Board of Trustees and approved by such Board and by a majority of the Trustees who are not “interested persons” of the Trust, as defined in the 1940 Act.

 

(c)          Waivers or Reimbursements of Expenses. Expenses may be waived or reimbursed by any adviser or any other provider of services to a Fund or the Trust without the prior approval of the Board of Trustees.

5.       Exchange and Conversion Features. Shareholders may exchange shares of one class of a Fund for shares of an identical class of another Fund, based upon each Fund’s net asset value per share, or exchange or have their shares converted between classes of shares of a Fund in the manner and to the extent set forth in the Funds’ then current prospectus.

No later than 5 years after purchase, Class C Shares of the Funds, except the Money Market Funds, will convert automatically to Class A Shares of such Funds. The conversion from Class C Shares to Class A Shares takes place at net asset value, as a result of which an investor receives dollar-for-dollar the same value of Class A Shares as he or she had of Class C Shares. The conversion occurs at the time identified in the Prospectus which shall be no later than 5 years after the beginning of the calendar month in which the Shares are purchased. As a result of the conversion, the converted Shares are relieved of the Rule 12b-1 fees borne by Class C Shares, although they are subject to the Rule 12b-1 fees borne by Class A Shares.

No later than 5 years after purchase, Class C Shares of the Money Market Funds will convert automatically to Class A Shares or Class D Shares, depending on the shareholder’s eligibility, of such Money Market Funds. The conversion from Class C Shares to Class A Shares or Class D Shares takes place at net asset value, as a result of which an investor receives dollar-for-dollar the same value of Class A Shares or Class D Shares as he or she had of Class C Shares. The conversion occurs at the time identified in the Prospectus which shall be no later than 5 years after the beginning of the calendar month in which the Shares are purchased. As a result of the conversion, the converted Shares are relieved of the Rule 12b-1 fees borne by Class C Shares, although they are subject to the Rule 12b-1 fees borne by Class A Shares or Class D Shares.

6.         Board Review.

(a) Initial Approval. The Board of Trustees, including a majority of the Trustees who are not interested persons (as defined in the 1940 Act) of the Trust or a Fund (“Independent Trustees”), approved the Plan based on a determination that the Plan, including the expense allocation, is in the best interests of each class and Fund individually and of the Trust. Their

determination was based on their review of information furnished to them which they deemed reasonably necessary and sufficient to evaluate the Plan.

(b) Approval of Material Amendments. The Plan may not be amended materially unless the Board of Trustees, including a majority of the Independent Trustees, have found that the proposed amendment, including any proposed related expense allocation, is in the best interests of each class and Fund individually and of the Trust. Such finding shall be based on information requested by the Board and furnished to them which the Board deems reasonably necessary to evaluate the proposed amendment.

(c) Periodic Review. The Board shall review reports of expense allocations and such other information as they request at such times, or pursuant to such schedule, as they may determine consistent with applicable legal requirements.

7.         Effective Date.

The Plan, having been reviewed and approved by the Board of Trustees and by a majority of the Independent Trustees, shall be amended and restated and effective as of March 24, 2021.

IN WITNESS WHEREOF, the Trust, on behalf of the Funds, has adopted this Multiple Class Plan, effective as of March 24, 2021.

		HSBC FUNDS
	By:	/s/Stefano R. Michelagnoli
	Name:	Stefano R. Michelagnoli
	Title:	President

 

 

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