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Exhibit 15(a)(iii)
PARTICIPATING ORGANIZATION AGREEMENT
PARTICIPATING ORGANIZATION AGREEMENT made as of the 21st day of September,
1994, by and between The Winsbury Company Limited Partnership d/b/a The
Winsbury Company, an Ohio Limited Partnership (the "Distributor"), First of
America Securities, Inc., a Michigan corporation (the "Agent") as a party and
on behalf of its affiliate, First of America Brokerage Service, a Michigan
corporation (the "Participating Organization").
WHEREAS, the Distributor serves as the Distributor of The Parkstone Group of
Funds (the "Group"), a Massachusetts business trust, which has filed a
Registration Statement under the Investment Company Act of 1940 as amended (the
"1940 Act") and the Securities Act of 1933 (the "Securities Act", and, together
with the 1940 Act, the "Acts"); and
WHEREAS, the Group is comprised of several separate investment portfolios,
each of which is segregated by class;
WHEREAS, the holders of Investor A shares ("Investor A Shares" or "Shares")
of each of the investment portfolios of the Group that are identified in
Exhibit A attached hereto (individually, a "Fund," collectively the "Funds")
have adopted an Investor A Distribution and Shareholder Services Plan (the
"Plan") pursuant to Rule 12b-1 under the 1940 Act;
WHEREAS, the Plan authorizes the Distributor to enter into agreements with
third parties to implement the Plan; and
WHEREAS, it is intended that the Agent and Participating Organization provide
certain distribution services in connection with the purchase of Investor A
Shares of the Group through certain accounts on behalf of Customers
("Customers") of Agent and the Participating Organization (the "Qualified
Accounts").
NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. REFERENCE TO PROSPECTUSES; DETERMINATION OF NET ASSET VALUE
1.1 Reference is hereby made to the prospectuses (individually a "Prospectus,"
collectively the "Prospectuses") for Investor A Shares of each Fund as
from time to time are effective under the Securities Act. Terms defined
therein and not otherwise defined herein are used herein with the meaning
so defined.
1.2 For purposes of determining the fees payable to Agent under Section 3, the
average daily net asset value of a Fund's Shares will be computed in the
manner specified in the Group's registration statement (as the same is in
effect from time to time) in connection with the computation of the net
asset value of such Fund's Shares for purposes of purchases and
redemptions.
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2. GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS
2.1 The Distributor hereby represents and warrants that it is the principal
underwriter of each portfolio of the Investor A Shares of each Fund, which
are identified in the Group's Registration Statement and that it is
authorized to enter into this Agreement pursuant to the Plan. The
Distributor has furnished the Agent with a list of the various states and
other jurisdictions in which the Investor A Shares of each Fund have been
qualified for sale under, or are exempt from the requirements of, the
respective securities laws of such states and jurisdictions, and will
promptly notify the Agent of any changes in such list.
2.2 Agent and the Participating Organization hereby represent, warrant and
covenant that they are each and will each be at all times relevant to this
Agreement registered as a broker-dealer under applicable state or federal
securities laws and are otherwise qualified under all applicable federal,
state and local laws to engage in the business and transactions described
in this Agreement. Agent and the Participating Organization agree to
comply with the requirements of all applicable laws, including any
applicable federal and state securities laws, the rules and regulations of
the SEC, and the rules and regulations issued by applicable federal bank
regulatory agencies. Agent and the Participating Organization agree that
they will not make Investor A Shares available for purchase to persons in
any jurisdiction in which such Shares are not registered for sale or in
which such Shares may not be lawfully sold. Agent and the Participating
Organization further agree that they will maintain all records required by
applicable law or otherwise reasonably requested by the Distributor in
relation to fund transactions that they have executed.
2.3 By written acceptance of this Agreement, Agent and the Participating
Organization agree to and do waive such portion of the fee payable under
Section 3 as is necessary to assure that the amount of such fee which is
required to be accrued by the Funds on any day with respect to such Funds'
Shares does not exceed the income to be accrued to the Shares on such
Funds on that day. The amount of the fee which must be waived by Agent
and the Participating Organization under this Section 2.4 will be
determined by the Distributor and will be based on Agent's pro rata
portion of the fees payable under the Funds' Plan (including those fees
payable to the Distributor and other organizations providing distribution
assistance with respect to such Funds' Shares and/or Shareholder services
to the holders of such Funds' Shares) that exceed the daily income to be
accrued to the Shares of such Funds.
2.4 By written acceptance of this Agreement, Agent and Participating
Organization represent, warrant and agree that: (i) the Participating
Organization will disclose to Customers the order execution that it or
Agent will perform pursuant to this agreement, other than those already
disclosed in the Prospectuses and in Fund applications, and a schedule of
any fees that the Participating Organization or Agent may charge directly
to Customers for services it performs in connection with investments in
the Group on the customer's behalf and (ii) any and all compensation
payable to Agent and the Participating Organization by Customers in
connection with the investment of their assets in the Group will be
disclosed by the Participating Organization to Customers.
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3. PURCHASE AUTHORIZATION; ORDER EXECUTION; OFFERING PRICE; DISTRIBUTION FEE
3.1 In all sales of Shares to Qualified Accounts, Agent and the Participating
Organization shall act as agent for their Customers and in no such
transaction shall Agent or Participating Organization act as dealer for
its own account. As agent for its Customers, Agent is hereby authorized
to: (i) place orders directly with the Funds' transfer agent for the
purchase of Shares and (ii) tender Shares to the transfer agent for
redemption, in each case subject to the terms and conditions set forth in
the Prospectus and the operating procedures and policies established by
the Distributor. The minimum dollar purchase of Shares shall be the
applicable minimum amount set forth in the Prospectus, and no order for
less than such amount shall be accepted by Agent or the Participating
Organization. The procedures relating to the handling of orders will be
subject to instructions which the Distributor shall forward to Agent or
the Participating Organization from time to time. For purposes of this
Agreement, Agent and the Participating Organization will be deemed to be
independent contractors, and will have no authority to act as agent for
the Distributor in any matter or in any respect.
3.2 All orders are subject to acceptance or rejection by the Distributor in
its sole discretion. No person is authorized to make any representations
concerning the Distributor, the Group, or a Fund's Shares except such
representations contained in the relevant then- current Prospectuses and
Statement of Additional Information and in such printed information as the
Group or the Distributor may subsequently prepare. Agent and the
Participating Organization are specifically authorized to distribute the
Prospectuses and Statement of Additional Information and sales material
received by them from the Distributor. No person is authorized to
distribute any other sales material relating to a Fund without the prior
approval of the Distributor. Agent and the Participating Organization
agree to deliver, upon the request of the Distributor, copies of any
relevant amended Prospectuses and Statement of Additional Information to
Customers to whom Shares have been sold.
3.3 Agent and the Participating Organization shall not withhold placing
Customers' orders for any Shares so as to profit themselves as a result of
such withholding. Distributor shall not purchase any Shares from the
Funds except for the purpose of covering purchase orders already received,
and Agent and the Participating Organization shall not purchase any Shares
from the Distributor except for the purpose of covering the purchase
orders already received.
3.4 If any Shares purchased by Agent or the Participating Organization are
repurchased by the Funds or by the Distributor for the account of the
Funds, or are tendered for redemption within seven (7) business days after
confirmation by the Distributor of the original purchase order for such
Shares, (1) Agent and the Participating Organization agree forthwith to
refund to the Distributor the full concession allowed to Agent, if any, on
the original sale, such refund to be paid by the Distributor to the Fund
whose Shares have been so repurchased upon receipt and (2) the Distributor
shall forthwith pay to such Fund that part of the discount retained by the
Distributor on the original sale. Notice will be given to Agent of any
such repurchase or redemption within ten (10) days of the date which the
repurchase or redemption is requested.
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3.5 No party to this Agreement shall, as agent, purchase any Shares from a
Qualified Account at a price lower than the net asset value next computed
by or for the issuer thereof. Nothing in this subparagraph shall prevent
Agent or the Participating Organization from selling Shares for the
account of a Qualified Account to the Distributor or the issuer and
charging the investor a fair commission for handling the transaction.
3.6 The Distributor will furnish Agent and Participating Organization, on
request, with offering prices for the Shares in accordance with the
then-current Prospectuses of the respective Funds of the Group, and Agent
and the Participating Organization agree to quote such prices subject to
the confirmation by the Distributor on any Shares offered to Agent and the
Participating Organization for sale. The public offering price equals the
net asset value per Share of the respective Fund plus a sales charge, if
any, as disclosed in the Prospectus of the individual Fund. The
Distributor hereby may, at its discretion, waive the front-end sales
charges, if any, typically charged for the purchase of Investor A Shares
for purchases executed by Agent on behalf of the Qualified Accounts.
Agent and the Participating Organization acknowledge the fact that each
price is always subject to confirmation, and will be the price next
computed after receipt of an order. Agent and the Participating
Organization acknowledge that it is Agent's responsibility to transmit
purchase orders promptly to the Distributor. Agent and the Participating
Organization further acknowledge that any failure to promptly transmit
such orders to the Distributor that causes a Qualified Account to receive
an improper price, based upon the requirements of Rule 22c-1 under the
1940 Act, shall be the joint and several responsibility of Agent and the
Participating Organization and shall not be the responsibility of the
Distributor. The Distributor reserves the right to cancel this Agreement
at any time without notice if any Share shall be offered for sale by Agent
or the Participating Organization at less than the then-current offering
price determined by or for the respective Fund.
3.7 Agent shall be entitled to receive a distribution fee ("12b-1 Fee"),
pursuant to the Plan, attached as Exhibit B, from Distributor at a rate
calculated on a per annum basis of the net asset value of the Group's
Investor A Shares, as computed in the manner specified in the Group's
registration statement (as the same is in effect from time to time) and
indicated on Exhibit A, purchased by Agent and the Participating
Organization as agent for their Customers. Agent shall also be entitled
to a concession which shall be that portion of the front-end sales load
identified in the Prospectuses payable by Winsbury as a commission for
sales of Shares to Qualified Accounts. Any amounts payable to
Participating Organization for services under this Agreement shall be paid
by Agent and shall not be the responsibility of the Distributor.
3.8 Agent, the Participating Organization and their employees will, upon
request, be available during normal business hours to consult with the
Distributor or its designees concerning the performance of Agent's or the
Participating Organization's responsibilities under this Agreement. Any
person authorized to direct the disposition of monies paid or payable by
the Distributor pursuant to Section 3 of this Agreement will provide to
the Distributor the Group's Board of Trustees, and the Group's Trustees
will review at least quarterly, a written report of the amounts so
expended and the purposes for which such expenditures were made. In
addition, Agent and the Participating Organization will furnish to the
Distributor, the Group or their designees such information as the
Distributor, the Group
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or their designees may reasonably request (including, without limitation,
periodic certifications confirming the provision to Customers of the
services described herein), and will otherwise cooperate with the
Distributor, the Group and their designees (including, without limitation,
any auditors designed by the Group), in the preparation of reports to the
Group's Board of Trustees concerning this Agreement and the monies paid or
payable by the Distributor pursuant hereto, as well as any other reports or
filings that may be required by law.
4. EXCULPATION; INDEMNIFICATION
4.1 The Distributor shall not be liable to Agent nor the Participating
Organization and Agent and the Participating Organization shall not be
liable to the Distributor except for acts or failures to act which
constitute lack of good faith or gross negligence and for obligations
expressly assumed by either party hereunder. Nothing contained in this
Agreement is intended to operate as a waiver by the Distributor or by
Agent or the Participating Organization of compliance with any provisions
of the Securities Act, the Securities Exchange Act of 1934, the 1940 Act,
the rules and regulations promulgated by the SEC, the NASD or any state
securities administrator, or the applicable rules and regulations
promulgated by federal banking agencies.
4.2 Agent and the Participating Organization will indemnify the Distributor
and hold it harmless from any claims or assertions relating to the
lawfulness of Agent's or the Participating Organization's participation in
this Agreement and the transactions contemplated hereby or relating to any
activities of any persons or entities affiliated with Agent or the
Participating Organization which are performed in connection with the
discharge of Agent's or the Participating Organization's responsibilities
under this Agreement. If such claims are asserted, the Distributor shall
have the right to manage its own defense, including the selection and
engagement of legal counsel, and all costs of such defense shall be born
by Agent and the Participating Organization.
4.3 The Distributor will indemnify Agent and the Participating Organization
and will hold Agent and the Participating Organization harmless from any
claims or assertions relating to the lawfulness of the Distributor's
participation in this Agreement and the transactions contemplated hereby
or relating to any activities or any persons or entities affiliated with
the Distributor which are performed in connection with the discharge of
the Distributor's responsibilities under this Agreement. If any such
claims are asserted, Agent and the Participating Organization shall have
the right to manage their own defense, including the selection and
engagement of legal counsel, and all costs of such defense shall be born
by the Distributor.
5. GENERAL
5.1 This Agreement will become effective with respect to each Fund on the date
indicated on the first page of this Agreement. Unless sooner terminated
with respect to any Fund, this Agreement may also be terminated at any
time without penalty by the vote of a majority of the members of the Board
of Trustees of the Group who are not "interested persons" (as such term is
defined in the 0000 Xxx) and who have no direct or indirect interest in
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the Plan relating to such Fund or any agreement relating to such Plan,
including this Agreement, or (with respect to a Fund) by a vote of the
majority of the outstanding voting securities of that Fund (as such term is
defined in the Statement of Additional Information), cast in person at a
meeting called for the approval of voting on such approval, on sixty (60)
days' written notice.
5.2 This Agreement will automatically terminate in the event of its
assignment. This Agreement may be terminated by the Distributor or by the
Agent or by the Participating Organization, without penalty, upon sixty
(60) days' prior written notice to the other party. This Agreement may
also be terminated at any time without penalty by the vote of a majority
of the members of the Board of Trustees of the Group who are not
"interested persons" (as such term is defined in the 0000 Xxx) and who
have no direct or indirect interest in the Plan relating to such Fund or
any agreement relating to such Plan, including this Agreement, or (with
respect to a Fund) by a vote of the majority of the outstanding voting
securities of that Fund (as such term is defined in the Statement of
Additional Information), cast in person at a meeting called for the
purpose of voting on such approval, on sixty (60) days' written notice.
5.3 All communications to the Distributor shall be sent to the address set
forth in this Agreement or at such other address as the Distributor may
designate to Agent in writing. Any notice to Agent or Participating
Organization shall be duly given if mailed or telecopied to Agent at the
address or addresses as the Agent may provide in writing to the
Distributor. All communications delivered to Agent pursuant to this
Agreement shall be deemed to be delivered to Participating Organization.
5.4 This Agreement supersedes any other Agreement between the Distributor and
Participating Organization and any other Agreement between the Distributor
and Agent with respect to the offer and sales of Investor A Shares of the
Group to Qualified Accounts and relating to any other matters discussed
herein. All covenants, agreements, and representations and warranties
made herein shall be deemed to have been material and relied on by each
party, not withstanding any investigation by either party or on behalf of
either party, and shall survive the execution and delivery of this
Agreement. The invalidity or unenforceability of any term or provision
hereof shall not affect the validity or enforceability of any other term
or provision hereof. The headings in this Agreement are for convenience
of reference only and shall alter or otherwise affect the meaning hereof.
This Agreement may be executed in any number of counterparts which
together shall constitute one instrument and shall be governed by a
construed in accordance of the laws (other than the conflict of laws
rules) of the State of Ohio and shall bind and inure to the benefit of the
parties hereto and the respective successors and assigns.
5.5 This Agreement is a Related Agreement under the Plan.
5.6 The names "The Parkstone Group of Funds" and "Trustees of the Parkstone
Group of 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 March 25, 1987, 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
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required by law, and to any and all amendments thereto so filed or
hereafter filed. The obligations of "The Parkstone Group of Funds" entered
into in the name of or on behalf thereof by any of the trustees,
representatives or agents are not made individually, but in such
capacities, and are not binding upon any of the trustees, shareholders, or
representatives of the Group personally, but bind only the assets of the
Group and all persons dealing with any series of shares of the Group must
look solely to the assets of the Group belonging to such series for the
enforcement of any claims against the Group.
5.7 All communications to the Distributor shall be sent to the following
address:
The Winsbury Company
0000 Xxxx Xxxxxx-Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
THE WINSBURY COMPANY LIMITED
PARTNERSHIP
By: The Winsbury Corporation,
General Partner
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Executive Vice President
FIRST OF AMERICA SECURITIES, INC.
On behalf of itself and First of
America Brokerage Service, Inc.
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
President
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EXHIBIT A
The Parkstone Group of Funds
Investor A Share Fund Fee
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1. Parkstone U.S. Government Obligations Fund 0.10%
2. Parkstone Tax-Free Fund 0.10%
3. Parkstone Prime Obligations Fund 0.10%
4. Parkstone Treasury Fund 0.10%
5. Parkstone Municipal Investor Fund 0.10%
6. Parkstone Equity Fund 0.25%
7. Parkstone Small Capitalization Fund 0.25%
8. Parkstone High Income Equity Fund 0.25%
9. Parkstone International Discovery Fund 0.25%
10. Parkstone Balanced Fund 0.25%
11. Parkstone Bond Fund 0.25%
12. Parkstone Limited Maturity Bond Fund 0.25%
13. Parkstone Michigan Municipal Bond Fund 0.25%
14. Parkstone Municipal Bond Fund 0.25%
15. Parkstone U.S. Government Income Fund 0.25%
16. Parkstone Intermediate Government Obligations Fund 0.25%
The Fees indicated above are subject to disclosure in the Prospectuses. The
parties hereto agree that Fees payable shall be governed by such Prospectus
disclosure notwithstanding any conflict with the figures set forth above.
THE WINSBURY COMPANY LIMITED
PARTNERSHIP
By: The Winsbury Corporation,
General Partner
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Executive Vice President
FIRST OF AMERICA SECURITIES, INC.
On behalf of itself and First of America
Brokerage Service, Inc.
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
President
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EXHIBIT B
Investor A Distribution and Shareholder Service Plan
This Plan (the "Investor A Plan") constitutes a distribution and shareholder
service plan of The Parkstone Group of Funds, a Massachusetts business trust
(the "Trust"), adopted pursuant Rule 12b-1 under the Investment Company Act of
1940, as amended, (the "1940 Act"). The Investor A Plan relates to the
Investor A Shares of those investment portfolios identified on Schedule B to
the Trust's Distribution Agreement and as amended form time to time (the
"Investor A Plan Funds").
Section 1. Each Investor A Plan Fund shall pay to The Winsbury Company
Limited Partnership, an Ohio limited partnership and the distributor (the
"Distributor") of the Trust's shares of beneficial interest of its Investor A
class (the "Investor A Shares"), a fee in an amount not to exceed on an annual
basis .25% of the average daily net asset value of the Investor A Shares of
such Fund (the "Investor A Plan Fee") for: (a) payments the Distributor makes
to banks and other institutions and broker/dealers (a "Participating
Organization") for distribution assistance and/or Shareholder service pursuant
to an agreement with the Participating Organization or for distribution
assistance and/or Shareholder service provided by the Distributor pursuant to
an agreement between the Distributor and the Trust; or (b) reimbursement of
expenses incurred by a Participating Organization pursuant to an agreement in
connection with distribution assistance and/or Shareholder service including,
but not limited to, the reimbursement of expenses relating to printing and
distributing prospectuses to persons other than Shareholders of an Investor A
Plan Fund, printing and distributing advertising and sales literature and
reports to Shareholders used in connection with the sale of Investor A Shares,
and personnel and communication equipment used in servicing Shareholder
accounts and prospective shareholder inquiries. For purposes of the Investor A
Plan, a Participating Organization may include the Distributor or any of its
affiliates or subsidiaries.
Section 2. The Investor A Plan Fee shall be paid by the Investor A Plan
Funds to the Distributor only to compensate or to reimburse the Distributor for
payments or expenses incurred pursuant to Section 1.
Section 3. The Investor A Plan shall not take effect with respect to an
Investor A Plan Fund until it has been approved by a vote of at least a
majority of the outstanding Investor A Shares of such Fund.
Section 4. The Investor A Plan shall not take effect until it has been
approved, together with any related agreements, by votes of the majority (or
whatever greater percentage may, from time to time, be required by Section
12(b) of the 1940 Act or the rules and regulations thereunder) of both (a) the
Trustees of the Trust, and (b) the Independent Trustees of the Trust cast in
person at a meeting called for the purpose of voting on the Investor A Plan or
such agreement.
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Section 5. The Investor A Plan shall continue in effect for a period of more
than one year after it takes effect only so long as such continuance is
specifically approved at least annually in the manner provided for approval of
the Investor A Plan in Section 4.
Section 6. Any person authorized to direct the disposition of monies paid or
payable by the Investor A Plan Funds pursuant to the Investor A Plan or any
related agreement shall provide to the Trustees of the Trust, and the Trustees
shall review, at least quarterly, a written report of the amounts so expended
and the purposes for which such expenditures were made.
Section 7. The Investor A Plan may be terminated at any time by vote of a
majority of the Independent Trustees, or by vote of a majority of the
outstanding Investor A Shares of an Investor A Plan Fund.
Section 8. All agreements with any person relating to implementation of the
Investor A Plan shall be in writing, and any agreement related to the Investor
A Plan shall provide:
(a) That such agreement may be terminated at any time, without payment of
any penalty, by vote of a majority of the Independent Trustees or by vote of
a majority of the outstanding Investor A Shares of the Investor A Plan Fund,
on not more than 60 days' written notice to any other party to the agreement;
and
(b) That such agreement shall terminate automatically in the event of its
assignment.
Section 9. The Investor A Plan may not be amended to increase materially the
amount of distribution expenses permitted pursuant to Section 1 hereof without
approval in the manner provided in Section 3 hereof, and all material
amendments to the Investor A Plan shall be approved in the manner provided for
approval of the Investor A Plan in Section 4.
Section 10. As used in the Investor A Plan, (a) the term "Independent
Trustees" shall mean those Trustees of the Trust who are not interested persons
of the Trust, and have no direct or indirect financial interest in the
operation of the Investor A Plan or any agreements related to it, and (b) the
terms "assignment", "interested person" and "majority of the outstanding voting
securities" shall have the respective meanings specified in the 1940 Act and
the rules and regulations thereunder, subject to such exemptions as may be
granted by the Securities and Exchange Commission.
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