Exhibit 15c
DISTRIBUTION SERVICES AGREEMENT (RULE 12b-1 PLAN)
This Distribution Services Agreement (the "Plan") is adopted
by The HomeState Group (the "Fund"), a Pennsylvania Common Law
Trust organized under the Investment Company Act of 1940 (the
"Act") as an open-end mutual fund, with respect to the
distribution of its shares of the HomeState Year 2000 "Y2K" Fund
(the "Shares") by Xxxxxx Square Distributor, Inc., the principal
underwriter and distributor for the Fund (the "Distributor").
WITNESSETH:
WHEREAS, the Fund is an open-end management company, and
WHEREAS, it has been proposed that the Fund make payments to
the Distributor out of the Fund's net assets for distribution
services rendered to the Fund; and
WHEREAS, the Fund intends to distribute its Shares in
accordance with Rule 12b-1 under the Act and desires to adopt a
distribution plan pursuant to such rule; and
WHEREAS, the Fund's Board of Trustees at a meeting held on
August 1, 1997, in considering whether the Fund should adopt and
implement a written plan, has evaluated such information as it
deemed necessary to make an informed determination as to whether
a written plan should be adopted and implemented and has
considered such pertinent factors as it deemed necessary to form
the basis for a decision to use assets of the Fund for such
purposes and has determined that there is a reasonable likelihood
that adoption and implementation of a plan will benefit the Fund
and is shareholders.
NOW, THEREFORE, the Fund hereby adopts a distribution plan
in accordance with Rule 12b-1 under the Act, having the following
terms and conditions:
1. The Distributor shall pay all costs and expenses
incurred in connection with (i) advertising and marketing the
Shares; (ii) payments of servicing fees to one or more securities
dealers (which may include the Distributor itself but only to the
extent necessary to reimburse the Distributor for its costs and
expenses incurred in connection with such servicing), financial
institutions or other industry professionals, such as investment
advisers, accountants, and estate planning firms (individually, a
"Service Organization"), in respect of the average daily net
asset value of the Shares owned by shareholders for whom the
Service Organization is the dealer of record or holder of record
and with whom the Service Organization has a servicing
relationship pursuant to the Fund's related Rule 12b-1 Service
Agreement; (iii) printing any Prospectuses, Statements of
Additional Information, or reports prepared for the Distributor's
use in connection with the offering of the Fund's Shares (except
those used for regulatory purposes or for distribution to
existing shareholders); and (iv) with implementing and operating
this Plan.
2. Each of the Fund's respective series will
reimburse the Distributor as appropriate for its out-of-pocket
costs and expenses described in Section (1) on a monthly basis at
an annual rate of not more than .50% of such Series net assets as
of the close of the last business day of the month. To determine
the maximum amount of the costs and expenses reimbursable
hereunder, the value of the Fund's net assets shall be computed
in the manner specified in the Fund's Prospectus and/or Statement
of Additional Information for the determination of the net asset
value of the Shares. The Distributor may incur additional
unreimbursed costs and expense in connection with the
distribution of Shares and may utilize its capital or any other
resources to pay for such costs and expenses.
3. The Fund shall, from time to time, furnish or
otherwise make available to the Distributor such financial
reports, proxy statements, and other information relating to the
business and affairs of the Fund as the Distributor may
reasonably require in order to discharge its duties and
obligations hereunder.
4. Nothing herein contained shall be deemed to
require the Fund to take any action contrary to its Declaration
of Trust, or any applicable statutory or regulatory requirement
to which it is subject or by which it is bound, or relieve or
deprive the Board of Trustees of the Fund of the responsibility
for and control of the conduct of the affairs of the Fund.
5. This Plan shall become effective when executed
following approval by a vote of at least a majority of the
outstanding voting securities of the Fund and by a vote of the
Trustees of the Fund and of those Trustees who are not interested
persons of the Fund and who have no direct or indirect financial
interest in the Plan or in any agreements relating to the Plan
(the "Independent Trustees), cast in person at a meeting called
for the purpose of voting on the Plan.
6. This Plan shall remain in effect until June 30,
1999 and for successive annual periods of twelve months each
thereafter; provided, however, that such continuance is subject
to approval annually by a vote of the Trustees of the Fund and of
the Independent Trustees cast in person at a meeting called for
the purpose of voting on this Plan. If such annual approval is
not obtained, the Plan shall expire twelve months after the date
of the last approval. This Plan may be amended at any time by
the Board of Trustees; provided that (a) any amendment to
increase materially the amount to be spent for the services
described herein shall be effective only upon approval by a vote
of a majority of the outstanding Shares, and (b) any material
amendment of this Plan shall be effective only upon approval in
the manner provided in the first sentence of this paragraph.
7. This Plan may be terminated as to any Series at
any time, without the payment of any penalty, by a vote of a
majority of the Independent Trustees or by a vote of a majority
of the outstanding voting securities of such Series, and shall
automatically terminate in the event of its assignment.
8. Nothing herein contained shall prohibit the
Distributor or any "affiliated person" of the Distributor to act
as distributor for other persons, firms, or corporations or to
engage in other business activities.
9. Neither the Distributor nor any of its employees
or agents is authorized to make any representations concerning
the Shares except those contained in the Prospectus, Statement of
Additional Information, or such supplemental sales literature as
the Fund may approve.
10. The Distributor shall be required to use its best
efforts in rendering distribution services but shall not be
liable for any error of judgment or mistake of law or for any
loss suffered by the Fund in connection with matters to which the
Fund's distribution agreement with the Distributor relates except
a loss resulting from willful misfeasance, bad faith, or gross
negligence on the part of the Distributor in the performance of
its duties as Distributor of from reckless disregard by the
Distributor of its obligations and duties under such distribution
agreement.
11. The Distributor shall provide the Fund, for review by
the Fund's Board of Trustees, and the Directors shall review, at
least quarterly, a written report of the amounts expended
pursuant to this Plan and the purposes for which such
expenditures were made. Such written report shall be in a form
satisfactory to the Fund and shall supply all information
necessary for the Board to discharge its responsibilities,
including its responsibilities pursuant to Rule 12b-1.
12. While this Plan is in effect, the selection and
nomination of Independent Trustees shall be committed to the
discretion of such Independent Trustees.
13. The Fund shall preserve copies of this Plan, any
related agreements, and all reports made pursuant to Section 11
hereof for a period of not less than six years from the date of
this Plan, or any such agreement or report, as the case may be,
the first two years, in an easily accessible place.
14. In the event that the Fund establishes additional
classes of shares evidencing interests in other series with
respect to which it desires the Plan to apply, it shall notify
the Distributor in writing. If the Distributor is willing to act
hereunder it shall notify the Fund in writing whereupon such
series shall become a series hereunder and the compensation
payable by such new series to the Distributor will be as agreed
in writing at the time. Payments made by a series to the
Distributor pursuant to this Plan must be to reimburse the
Distributor for reimbursable costs and expenses incurred in
connection with the distribution of such series shares only.
15. If any provision of this Plan shall be held or made
invalid by a court decision statute, rule or otherwise, the
remainder of the Plan shall not be affected thereby.
16. For the purposes of this Plan, the terms "interested
persons," "assignment," "affiliated person" and "majority of the
outstanding voting securities" are used as defined in the Act.
IN WITNESS WHEREOF, this Plan has been executed by the Fund
effective as of September 12, 1997.
THE HOMESTATE GROUP
By: /s/ Xxxxx X. Xxxx
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President
Attest: /s/ Xxxxxx X. Xxxxx XX
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Secretary
