DISTRIBUTION AGREEMENT
BETWEEN
THE NORTH COUNTRY FUNDS
AND
ORBITEX FUNDS DISTRIBUTOR, INC.
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THE NORTH COUNTRY FUNDS
DISTRIBUTION AGREEMENT
AGREEMENT made this 23rd day of April 2002, by and between The North
Country Funds, a Massachusetts business trust, having its principal office and
place of business at 000 Xxxx Xxxxxx, Xxxxx Xxxxx, XX 00000 (the "Trust"), and
ORBITEX FUNDS DISTRIBUTOR, INC., a New York corporation having its principal
office and place of business at 00000 Xxxxxxxxxx Xxxxxx, Xxxxx, XX 00000
("OFD").
WHEREAS, the Trust is an open-end management investment company registered
with the United States Securities and Exchange Commission under the Investment
Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Trust is authorized to issue shares of beneficial interest
("Shares") in separate series, with each such series representing interests in a
separate portfolio of securities and other assets, and is authorized to divide
those series into separate classes; and
WHEREAS, the Trust offers Shares in the series as listed in Schedule A
hereto (each such series, together with all other series subsequently
established by the Trust and made subject to this Agreement being herein
referred to as a "Fund," and collectively as the "Funds") and the Trust offers
shares of the classes of each Fund as listed in Schedule A hereto (each such
class together with all other classes subsequently established by the Trust and
made subject to this Agreement being herein referred to as a "Class," and
collectively as the "Classes"); and
WHEREAS, OFD is registered under the Securities Exchange Act of 1934, as
amended ("1934 Act"), as a broker-dealer and is engaged in the business of
selling shares of registered investment companies either directly to purchasers
or through other financial intermediaries; and
WHEREAS, the Trust desires that OFD offer, as principal underwriter, the
Shares of each Fund and Class thereof to the public and OFD is willing to
provide those services on the terms and conditions set forth in this Agreement
in order to promote the growth of the Funds and facilitate the distribution of
the Shares;
NOW THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, the Trust and OFD hereby agree as follows.
1. APPOINTMENT OF OFD AND DELIVERY OF DOCUMENTS
(a) The Trust hereby appoints OFD, and OFD hereby agrees, to act as
distributor of the Shares of the Funds and Classes for the period and on the
terms set forth in this Agreement. In connection therewith, the Trust has
delivered to OFD copies of
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(i) the Trust's Declaration of Trust, Trust Instrument and Bylaws ("Organic
Documents");
(ii) the Trust's current Registration Statement;
(iii) the Trust's notification of registration under the 1940 Act on Form
N-8A as filed with the SEC;
(iv) the Trust's current Prospectus and Statement of Additional Information
for each Fund (collectively, as currently in effect and as amended or
supplemented, the "Prospectus");
(v) each current plan of distribution or similar document adopted by the
Trust under Rule 12b-1 under the 1940 Act ("Plan") and each current shareholder
service plan or similar document adopted by the Trust ("Service Plan").
(b) The Trust shall promptly furnish OFD with:
(i) all amendments of or supplements to the foregoing; and
(ii) a certified copy of the resolution of the Board appointing OFD and
authorizing the execution and delivery of this Agreement.
2. EXCLUSIVE NATURE OF DUTIES
(a) OFD shall be the exclusive representative of the Trust to act as
distributor of the Funds except that the rights given under this Agreement to
OFD shall not apply to: (i) Shares issued in connection with the merger,
consolidation or reorganization of any other investment company or series or
class thereof with a Fund or Class thereof; (ii) a Fund's acquisition by
purchase or otherwise of all or substantially all of the assets or stock of any
other investment company or series or class thereof; (iii) the reinvestment in
Shares by a Fund's shareholders of dividends or other distributions; or (iv) any
other offering by the Trust of securities to its shareholders (collectively
"exempt transactions").
(b) Notwithstanding the foregoing, OFD is and may in the future distribute
shares of other investment companies including investment companies having
investment objectives similar to those of the Funds. The Trust further
understands that existing and future investors in the Funds may invest in shares
of such other investment companies. The Trust agrees that the services that OFD
provides to such other investment companies shall not be deemed in conflict with
its duties to the Trust under this Agreement.
3. OFFERING OF SHARES
(a) OFD shall have the right to buy from the Trust the Shares needed to
fill unconditional orders for Shares of the Funds placed with OFD by investors
or selected dealers or selected agents (each as defined in Section 11 hereof)
acting as agent for their customers' or on their own behalf. Alternatively, OFD
may act as the Trust's agent, to offer, and to solicit offers to subscribe to,
Shares of the Funds.
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(b) The price that OFD shall pay for Shares purchased from the Trust shall
be the NAV of the respective Class or Classes used in determining the Public
Offering Price on which the orders are based. Shares purchased by OFD are to be
resold by OFD to investors at the respective Public Offering Price(s), or to
selected dealers or selected agents acting in accordance with the terms of
selected dealer or selected agent agreements described in Section 11 of this
Agreement. The Trust will advise OFD of the NAV(s) each time that it is
determined by the Trust, or its designated agent, and at such other times as OFD
may reasonably request.
(c) OFD will promptly forward all orders and subscriptions to the Trust or
it designated agent. All orders and all subscriptions shall be directed to the
Trust for acceptance and shall not be binding until accepted by the Trust. Any
order or subscription may be rejected by the Trust; provided, however, that the
Trust will not arbitrarily or without reasonable cause refuse to accept or
confirm orders or subscriptions for the purchase of Shares. The Trust or its
designated agent will confirm orders and subscriptions upon their receipt, will
make appropriate book entries and, upon receipt by the Trust or its designated
agent of payment therefor, will issue such Shares in certificated or
uncertificated form pursuant to the instructions of OFD. OFD agrees to cause
such payment and such instructions to be delivered promptly to the Trust or its
designated agent.
(d) The Trust reserves the right to sell Shares directly to investors
through subscriptions received by the Trust, but no such direct sales shall
affect the sales charges due to OFD hereunder.
(e) The Trust reserves the right to suspend the offering of Shares of a
Fund or of any Class thereof at any time in the absolute discretion of the
Board, and upon notice of such suspension OFD shall cease to offer Shares of the
Funds or Classes thereof specified in the notice.
(f) No Shares shall be offered by either OFD 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 the effectiveness of
the Registration Statement then in effect or any necessary amendments thereto
shall be suspended under any of the provisions of the Securities Act, or if and
so long as a current prospectus, as required by Section 10(b) of the Securities
Act, as amended, is not on file with the SEC; provided, however, that nothing
contained in this paragraph shall in any way limit the Trust's obligation to
repurchase Shares from any shareholder in accordance with the provisions of the
Trust's Organic Documents or the prospectus applicable to the Shares.
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4. REPURCHASE OR REDEMPTION OF SHARES BY THE TRUST
(a) Any of the outstanding Shares of a Fund or Class thereof may be
tendered for redemption at any time, and the Trust agrees to redeem or
repurchase the Shares so tendered in accordance with its obligations as set
forth in the Organic Documents and the Prospectus relating to the Shares.
(b) The Trust or its designated agent shall pay:
(i) the total amount of the redemption price consisting of the NAV less any
applicable deferred sales charge to the redeeming shareholder or its agent, and
(ii) except as may be otherwise required by the NASD Rules, any applicable
deferred sales charges to OFD in accordance with OFD's instructions on or before
the fifth business day (or such other earlier business day as is customary in
the investment company industry) subsequent to the Trust's or its agent's having
received the notice of redemption in proper form.
(c) Redemption of Shares or payment therefore may be suspended at times
when the New York Stock Exchange is closed for any reason other than its
customary weekend or holiday closings, when trading thereon is restricted, when
an emergency exists as a result of which disposal by the Trust of securities
owned by a Fund is not reasonably practicable or it is not reasonably
practicable for the Trust fairly to determine the value of a Fund's net assets,
or during any other period when the SEC so requires or permits.
5. DUTIES AND REPRESENTATIONS OF OFD
(a) OFD shall use reasonable efforts to facilitate the sale of Shares of
the Funds upon the terms and conditions contained herein and in the then current
Prospectus. OFD shall devote reasonable time and effort to effect sales of
Shares but shall not be obligated to sell any specific number of Shares. The
services of OFD to the Trust hereunder are not to be deemed exclusive, and
nothing herein contained shall prevent OFD from entering into like arrangements
with other investment companies so long as the performance of its obligations
hereunder is not impaired thereby.
(b) OFD will execute and deliver agreements with broker/dealers, financial
institutions and other industry professionals based on forms of agreement
approved from time to time by the Board with respect to the various classes of
shares of the Funds, including but not limited to forms of sales support
agreements and shareholder servicing agreements approved in connection with a
distribution and/or servicing plan approved in accordance with Rule 12b-1 under
the 1940 Act.
(c) OFD will use appropriate efforts to solicit orders for the Sale of
Share and shall undertake such activities as it believes reasonable and
appropriate and wich are primarily intended to result in the sale of Shares,
including, but not limited to, advertising, compensation of underwriters,
dealers and sales personnel, the printing and mailing of prospectuses to other
than current shareholders, and the printing and mailing of sale literature. OFD
shall be responsible for reviewing and providing advice and counsel on, and
filing with the NASD, all sales literature (e.g., advertisements, brochures and
shareholder communications) with respect to each of the Funds. In addition, OFD
will provide one or more persons, during normal business hours, to respond to
telephone questions with respect to the Funds.
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(d) All activities by OFD and its agents and employees as distributor of
Shares shall comply with all applicable laws, rules and regulations, including,
without limitation, the 1940 Act, the Securities Act, the Securities Exchange
Act, and the NASD Rules, all rules and regulations made or adopted pursuant to
the 1940 Act by the SEC or any securities association registered under the
Securities Exchange Act.
(e) In selling Shares of the Funds, OFD shall use its best efforts in all
material respects duly to conform with the requirements of all federal and state
laws relating to the sale of the Shares. None of OFD, any selected dealer, any
selected agent or any other person is authorized by the Trust to give any
information or to make any representations other than as is contained in a
Fund's Prospectus or any advertising materials or sales literature specifically
approved in writing by the Trust or its agents.
(f) OFD shall adopt and follow procedures for the confirmation of sales to
investors and selected dealers or selected agents, the collection of amounts
payable by investors and selected dealers or selected agents on such sales, and
the cancellation of unsettled transactions, as may be necessary to comply with
the requirements of the NASD.
(g) OFD represents and warrants to the Trust that:
(i) It is a corporation duly organized and existing and in good standing
under the laws of the State of Nebraska and it is duly qualified to carry on its
business in the State of Nebraska;
(ii) It is empowered under applicable laws and by its Articles of
Incorporation to enter into and perform this Agreement;
(iii) All requisite corporate proceedings have been taken to authorize it
to enter into and perform this Agreement;
(iv) It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement;
(v) This Agreement, when executed and delivered, will constitute a legal,
valid and binding obligation of the Distributor, enforceable against the
Distributor in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting the
rights and remedies of creditors and secured parties;
(vi) It is registered under the Securities Exchange Act with the SEC as a
broker-dealer, it is a member in good standing of the NASD, it will abide by the
NASD Rules, and it will notify the Trust if its membership in the NASD is
terminated or suspended; and
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(vii) The performance by the Distributor of its obligations hereunder does
not and will not contravene any provision of its Articles of Incorporation.
(h) Notwithstanding anything in this Agreement, including the Schedules, to
the contrary, OFD makes no warranty or representation as to the number of
selected dealers or selected agents with which it has entered into agreements in
accordance with Section 11 hereof, as to the availability of any Shares to be
sold through any selected dealer, selected agent or other intermediary or as to
any other matter not specifically set forth herein.
6. DUTIES AND REPRESENTATIONS OF THE TRUST
(a) The Trust shall furnish to OFD copies of all financial statements and
other documents to be delivered to shareholders or investors at least two Fund
Business Days prior to such delivery and shall furnish OFD copies of all other
financial statements, documents and other papers or information which OFD may
reasonably request for use in connection with the distribution of Shares. The
Trust shall make available to OFD the number of copies of the Funds'
Prospectuses as OFD shall reasonably request.
(b) The Trust shall take, from time to time, subject to the approval of the
Board and any required approval of the shareholders of the Trust, all actions
necessary to fix the number of authorized Shares (if such number is not
unlimited) and to register the Shares under the Securities Act, to the end that
there will be available for sale the number of Shares as reasonably may be
expected to be sold pursuant to this Agreement.
(c) The Trust will execute any and all documents, furnish any and all
information and otherwise take all actions that may be reasonably necessary to
register or qualify Shares for sale in such states as OFD may designate to the
Trust and the Trust may approve, and the Trust shall pay all fees and other
expenses incurred in connection with such registration or qualification;
provided that OFD shall not be required to register as a broker-dealer or file a
consent to service of process in any State and neither the Trust nor any Fund or
Class thereof shall be required to qualify as a foreign corporation, trust or
association in any State. Any registration or qualification may be withheld,
terminated or withdrawn by the Trust at any time in its discretion. OFD shall
furnish such information and other material relating to its affairs and
activities as the Trust requires in connection with such registration or
qualification.
(d) The Trust represents and warrants to OFD that:
(i) It is a business trust duly organized and existing and in good standing
under the laws of the Commonwealth of Massachusetts;
(ii) It is empowered under applicable laws and by its Organic Documents to
enter into and perform this Agreement;
(iii) All proceedings required by the Organic Documents have been taken to
authorize it to enter into and perform its duties under this Agreement;
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(iv) It is an open-end management investment company registered with the
SEC under the 1940 Act;
(v) All Shares, when issued, shall be validly issued, fully paid and
non-assessable;
(vi) This Agreement, when executed and delivered, will constitute a legal,
valid and binding obligation of the Trust, enforceable against the Trust in
accordance with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the rights and
remedies of creditors and secured parties;
(vii) The performance by the Distributor of its obligations hereunder does
not and will not contravene any provision of its Articles of Incorporation.
(viii) The Registration Statement is currently effective and will remain
effective with respect to all Shares of the Funds and Classes thereof being
offered for sale;
(ix) The Registration Statement and Prospectuses have been or will be, as
the case may be, carefully prepared in conformity with the requirements of the
Securities Act and the rules and regulations thereunder;
(x) The Registration Statement and Prospectuses contain or will contain all
statements required to be stated therein in accordance with the Securities Act
and the rules and regulations thereunder; all statements of fact contained or to
be contained in the Registration Statement or Prospectuses are or will be true
and correct at the time indicated or on the effective date as the case may be;
and neither the Registration Statement nor any Prospectus, when they shall
become effective or be authorized for use, 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
Shares;
(xi) It will from time to time file such amendment or amendments to the
Registration Statement and Prospectuses as, in the light of then-current and
then-prospective developments, shall, in the opinion of its counsel, be
necessary in order to have the Registration Statement and Prospectuses at all
times contain all material facts required to be stated therein or necessary to
make any statements therein not misleading to a purchaser of Shares ("Required
Amendments");
(xii) It shall not file any amendment to the Registration Statement or
Prospectuses without giving OFD reasonable advance notice thereof; 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 the Registration Statement
or Prospectuses, of whatever character, as the Trust may deem advisable, such
right being in all respects absolute and unconditional; and
(xiii) Any amendment to the Registration Statement or Prospectuses
hereafter filed will, when it becomes effective, contain all statements required
to be stated therein in accordance with the 1940 Act and the rules and
regulations thereunder; all statements of fact contained in the Registration
Statement or Prospectuses will, when it becomes effective, be true and correct
at the time indicated or on the effective date as the case may be; and no such
amendment, when it becomes effective, will include an untrue statement of a
material fact or will 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.
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7. INDEMNIFICATION OF OFD BY THE TRUST
(a) The Trust authorizes OFD and any dealers with whom OFD has entered into
dealer agreements to use any Prospectus in the form furnished by the Trust in
connection with the sale of Shares. The Trust agrees to indemnify, defend and
hold OFD, its several officers and directors, and any person who controls OFD
within the meaning of Section 15 of the Securities Act free and harmless from
and against any and all claims, demands, liabilities and expenses (including the
reasonable cost of investigating or defending such claims, demands or
liabilities and any reasonable counsel fees incurred in connection therewith)
which OFD, its officers and directors, or any such controlling persons, may
incur under the Securities Act, the 1940 Act, or common law or otherwise,
arising out of or based upon
(i) any untrue statement, or alleged untrue statement, of a material fact
required to be stated in either any Registration Statement or any Prospectus,
(ii) any omission, or alleged omission, to state a material fact required
to be stated in any Registration Statement or any Prospectus or necessary to
make the statements in any of them not misleading, or
(iii) the Trust's failure to maintain an effective Registration statement
and Prospectuses with respect to Shares of the Funds and Classes that are the
subject of the claim or demand.
(b) The Trust's agreement to indemnify OFD, its officers or directors, and
any such controlling person will not be deemed to cover any such claim, demand,
liability or expense to the extent that it arises out of or is based upon
(i) any such untrue statement, alleged untrue statement, omission or
alleged omission made in any Registration Statement or any Prospectus in
reliance upon information furnished by OFD, its officers, directors or any such
controlling person to the Trust or its representatives for use in the
preparation thereof, or
(ii) willful misfeasance, bad faith or gross negligence in the performance
of OFD's duties, or by reason of OFD's reckless disregard of its obligations and
duties under this Agreement ("Disqualifying Conduct").
(c) The Trust's agreement to indemnify OFD, its officers and directors, and
any such controlling person, as aforesaid, is expressly conditioned upon the
Trust's being notified of any action brought against OFD, its officers or
directors, or any such controlling person, such notification to be given by
letter, by facsimile or by telegram addressed to the Trust at its address set
forth above within a reasonable period of time after the summons or other first
legal process shall have been served; provided, however, that 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 alleged untrue, statement or omission,
or alleged omission, otherwise than on account of the Trust's indemnity
agreement contained in this Section.
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(d) 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 OFD, which approval shall not be unreasonably withheld. If the Trust elects
to assume the defense of any such suit and retain counsel of good standing
approved by OFD, 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, the Trust will
reimburse OFD, its officers and directors, or the controlling person or persons
named as defendant or defendants in such suit, for the reasonable fees and
expenses of any counsel retained by them.
(e) The Trust's indemnification agreement contained in this Section 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 OFD, its officers and directors, or any controlling person, and shall
survive the delivery of any Shares. This agreement of indemnity will inure
exclusively to OFD's benefit, to the benefit of its several officers and
directors, and their respective estates, and to the benefit of any controlling
persons and their successors. The Trust agrees promptly to notify OFD of the
commencement of any litigation or proceedings against the Trust or any of its
officers or Board members in connection with the issue and sale of Shares.
8. INDEMNIFICATION OF THE TRUST BY OFD
(a) OFD agrees to indemnify, defend and hold the Trust, its several
officers and Board members, and any person who controls the Trust within the
meaning of Section 15 of the Securities Act, free and harmless from and against
any and all claims, demands, liabilities and expenses (including the reasonable
cost of investigating or defending such claims, demands or liabilities and any
reasonable counsel fees incurred in connection therewith) which the Trust, its
officers or Board members, or any such controlling person, may incur under the
Securities Act, the 1940 Act, or under common law or otherwise, but only to the
extent that such liability or expense incurred by the Trust, its officers or
Board members, or such controlling person resulting from such claims or demands
(i) shall arise out of or be based upon any unauthorized sales literature,
advertisements, information, statements or representations or any Disqualifying
Conduct in connection with the offering and sale of any Shares, or
(ii) shall arise out of or be based upon any untrue, or alleged untrue,
statement of a material fact contained in information furnished in writing by
OFD to the Trust specifically for use in the Trust's Registration Statement and
used in the answers to any of the items of the Registration Statement or in the
corresponding statements made in the Prospectus, or shall arise out of or be
based upon any omission, or alleged omission, to state a material fact in
connection with such information furnished in writing by OFD to the Trust and
required to be stated in such answers or necessary to make such information not
misleading.
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(b) OFD's agreement to indemnify the Trust, its officers and Trustees, and
any such controlling person, as aforesaid, is expressly conditioned upon OFD's
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, by facsimile or by telegram addressed to OFD at its address set forth
above within a reasonable period of time after the summons or other first legal
process shall have been served.
(c) The failure so to notify OFD of any such action shall not relieve OFD
from any liability which its may have to the person against whom such action is
brought by reason of any such untrue, or alleged untrue, statement or omission,
or alleged omission, otherwise than on account of OFD's indemnity agreement
contained in this Section.
(d) OFD 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 OFD and approved by the
Trust, which approval shall not be unreasonably withheld. If OFD elects to
assume the defense of any such suit and retain counsel of good standing approved
by the Trust, the defendant or defendants in such suit shall bear the fees and
expenses of any additional counsel retained by any of them; but in the case OFD
does not elect to assume the defense of any such suit, OFD will reimburse the
Trust, the Trust's officers and directors, or the controlling person or persons
named as defendant or defendants in such suit, for the reasonable fees and
expenses of any counsel retained by the Trust or them.
(e) OFD's indemnification agreement contained in this Section and OFD's
representations and warranties in this Agreement shall remain operative and in
full force and effect regardless of any investigation made by OFD or on behalf
of OFD, its officers and directors, or any controlling person, and shall survive
the delivery of any Shares. This agreement of indemnity will inure exclusively
to the Trust's benefit, to the benefit of the Trust's officers and trustees, and
their respective estates, and to the benefit of any controlling persons and
their successors. OFD agrees promptly to notify the Trust of the commencement of
any litigation or proceedings against OFD or any of its officers or trustees in
connection with the issue and sale of Shares.
9. NOTIFICATION BY THE TRUST
(a) The Trust agrees to advise OFD as soon as reasonably practical:
(i) of any request by the SEC for amendments to the Registration Statement
or any Prospectus then in effect;
(ii) of the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or any Prospectus then in effect or
of the initiation of any proceeding for that purpose;
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(iii) of the happening of any event that makes untrue any statement of a
material fact made in the Registration Statement or any Prospectus then in
effect or which requires the making of a change in such Registration Statement
or Prospectus in order to make the statements therein not misleading;
(iv) of all actions of the SEC with respect to any amendment to any
Registration Statement or any Prospectus which may from time to time be filed
with the SEC; and
(v) if a current Prospectus is not on file 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.
10. COMPENSATION AND EXPENSES
(a) In consideration of the Distributor's services in connection with the
distribution of Shares of each Fund and Class thereof, OFD shall receive:
(i) any applicable sales charge assessed upon investors in connection with
the purchase of Shares;
(ii) from the Trust, any applicable contingent deferred sales charge
("CDSC") assessed upon investors in connection with the redemption of Shares;
(iii) from the Trust, the distribution services fees with respect tot eh
Shares of those Classes as designated in Appendix A for which a Plan is
effective (the "Distribution Fee"); and
(iv) from the Trust, the shareholder services fees with respect to the
Shares of those Classes as designated in Appendix A for which a Service Plan is
effective (the "Shareholder Services Fee").
(b) The Distribution Fee and Shareholder Service Fee shall be accrued daily
by each applicable Fund or Class thereof and shall be paid monthly as promptly
as possible after the last day of each calendar month but in any event on or
before the fifth (5th) Fund Business Day after month-end, at the rate or in the
amounts set forth in the Plan(s). The Trust grants and transfers to OFD a
general lien and security interest in any and all securities and other assets of
a Fund now or hereafter maintained in an account at the Fund's custodian on
behalf of the Fund to secure any Distribution Fees and Shareholder Service Fees
owed OFD by the Trust under this Agreement.
(c) The Trust shall cause its transfer agent (the "Transfer Agent") to
withhold, from redemption proceeds payable to holders of Shares of the Funds and
the Classes thereof, all CDSCs properly payable by the shareholders in
accordance with the terms of the applicable Prospectus and shall cause the
Transfer Agent to pay such amounts over to OFD as promptly as possible after the
settlement date for each redemption of Shares.
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(d) The Trust shall be responsible and assumes the obligation for payment
of all the expenses of the Funds, including fees and disbursements of its
counsel and auditors, in connection with the preparation and filing of the
Registration Statement and Prospectuses (including but not limited to the
expense of setting in type the Registration Statement and Prospectuses and
printing sufficient quantities for internal compliance, regulatory purposes and
for distribution to current shareholders).
(e) The Trust shall bear the cost and expenses (i) of the registration of
the Shares for sale under the Securities Act; (ii) of the registration or
qualification of the Shares for sale under the securities laws of the various
States; (iii) if necessary or advisable in connection therewith, of qualifying
the Trust, the Funds or the Classes thereof (but not OFD) as an issuer or as a
broker or dealer, in such States as shall be selected by the Trust and OFD
pursuant to Section 6(c) hereof; and (iv) payable to each State for continuing
registration or qualification therein until the Trust decides to discontinue
registration or qualification pursuant to Section 6(c) hereof. OFD shall pay all
expenses relating to OFD's broker-dealer qualification.
11. SELECTED DEALER AND SELECTED AGENT AGREEMENTS
The Distributor shall have the right to enter into selected dealer agreements
with securities dealers of its choice ("selected dealers") and selected agent
agreements with depository institutions and other financial intermediaries of
its choice ("selected agents") for the sale of Shares and to fix therein the
portion of the sales charge, if any, that may be allocated to the selected
dealers or selected agents; provided, that the Trust shall approve the forms of
agreements with selected dealers or selected agents and shall review the
compensation set forth therein. Selected dealers and selected agents shall
resell Shares of each Fund or Class thereof at the public offering price(s) set
forth in the Prospectus relating to the Shares. Within the United States, OFD
shall offer and sell Shares of the Funds only to selected dealers that are
members in good standing of the NASD.
12. CONFIDENTIALITY
The Distributor agrees to treat all records and other information related to the
Trust as proprietary information of the Trust and, on behalf of itself and its
employees, to keep confidential all such information, except that OFD may:
(a) prepare or assist in the preparation of periodic reports to
shareholders and regulatory bodies such as the SEC;
(b) provide information typically supplied in the investment company
industry to companies that track or report price, performance or other
information regarding investment companies; and
(c) release such other information as approved in writing by the Trust,
which approval shall not be unreasonably withheld;
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provided, however, that OFD may release any information regarding the Trust
without the consent of the Trust if OFD reasonably believes that it may be
exposed to civil or criminal legal proceedings for failure to comply, when
requested to release any information by duly constituted authorities or when so
requested by the Trust.
13. EFFECTIVENESS AND DURATION
(a) This Agreement shall become effective as of the date hereof and will
continue for an initial one-year term and will continue thereafter so long as
such continuance is specifically approved at least annually (i) by the Trust's
Board or (ii) by a vote of a majority of the Shares of the Trust or the relevant
Fund, as the case may be, provided that in either event its continuance also is
approved by a majority of the Board members who are not "interested persons" of
any party to this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval.
(b) This agreement is terminable, without penalty, on not less than sixty
days' notice, by the Board, by vote of a majority of the outstanding voting
securities of such Trust, or by OFD.
(c) This Agreement will automatically and immediately terminate in the
event of its "assignment."
(d) OFD agrees to notify the Trust immediately upon the event of OFD's
expulsion or suspension by the NASD. This Agreement will automatically and
immediately terminate in the event of OFD's expulsion or suspension by the NASD.
14. DEFINITIONS
As used in this Agreement, the following terms shall have the meaning set forth
below:
(a) The "Board" means the Board of Trustees of the Trust.
(b) "Fund Business Day" means any day on which the NAV of Shares of the
applicable Fund is determined as stated in the then current prospectus.
(c) "NASD Rules" means the Constitution, By-Laws, and Rules of Fair
Practice of the National Association of Securities Dealers, Inc. (the "NASD")
and any interpretations thereof.
(a) "NAV" means the net asset value per Share of each Class of each Fund as
determined by the Trust, or its designated agent, in accordance with and at the
times indicated in the applicable Prospectus of the Trust on each Fund Business
Day in accordance with the method set forth in the Prospectus and guidelines
established by the Board.
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(d) "Public Offering Price" means the price per Share of each Class of each
Fund at which OFD or selected dealers or selected agents may sell Shares to the
public or to those persons eligible to invest in Shares as described in the
applicable Prospectus of the Trust, determined in accordance with such
Prospectus under the Securities Act relating to such Shares.
(e) "Prospectus" means the current prospectuses and statements of
additional information of each Fund and Class thereof, as currently in effect
and as amended or supplemented.
(f) "Registration Statement" means the Trust's Registration Statement on
Form N-1A and all amendments thereto filed with the SEC.
(g) "SEC" means the U.S. Securities and Exchange Commission.
(h) "Securities Act" means the Securities Act of 1933, as amended.
(i) "Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(j) "1940 Act" means the Investment Company Act of 1940, as amended.
(k) The terms "majority of the outstanding voting securities," "interested
person" and "assignment" shall have the same meanings as such terms have in the
1940 Act.
15. MISCELLANEOUS
(a) No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against which an enforcement of the change, waiver, discharge or termination is
sought.
(b) The laws of the State of New York shall govern this agreement without
giving effect to principles of conflicts of laws.
(c) 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 upon 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 executed
in their names and on their behalf by and through their duly authorized persons,
as of the day and year first above written.
The North Country Funds Orbitex Funds Distributor, Inc
By: By:
-------------------------- ----------------------------
Xxxx Xxxxx Xxxxxx X. Xxxxxxx
President President
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The North Country Funds
DISTRIBUTION AGREEMENT
SCHEDULE A
FUNDS AND CLASSES TO BE SERVICED UNDER THIS AGREEMENT
North Country Equity Growth Fund
North Country Intermediate Bond Fund
The North Country Funds Orbitex Funds Distributor, Inc
By: By:
------------------- ------------------
Xxxx Xxxxx Xxxxxx X. Xxxxxxx
President President
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