Exhibit (e)
NORWEST ADVANTAGE FUNDS
DISTRIBUTION SERVICES AGREEMENT
October 1, 1995
Amended April 26, 1999
AGREEMENT made the 1st day of October, 1995 as amended on the 26th day
of April 1999 between Norwest Advantage Funds (the "Trust"), a business trust
organized under the laws of the State of Delaware with its principal place of
business at Two Xxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxx 00000 and Forum Financial
Services, Inc. ("Forum"), a corporation organized under the laws of State of
Delaware with its principal place of business at Xxx Xxxxxxxx Xxxxxx, Xxxxxxxx,
Xxxxx 00000.
WHEREAS, the Trust is registered under the Investment Company Act of
1940, as amended (the "Act"), as an open-end management investment company and
offers for sale continuously shares of beneficial interest, no par value, in
separate series and classes;
WHEREAS, Forum is a registered broker-dealer engaged in the business of
selling shares of registered investment companies either directly to purchasers
or through other securities dealers;
WHEREAS, the Trust desires that Forum, as principal underwriter, offer
the shares of each series of the Trust (each a Fund) and of each class thereof
as listed in Appendix A hereto (referred to as the "Shares") and Forum is
willing to so act as principal underwriter on the terms and conditions set forth
in this Agreement in order to promote the growth of the Funds and facilitate the
distribution of their Shares;
NOW, THEREFORE, the parties agree as follows:
SECTION 1. DELIVERY OF DOCUMENTS AND APPOINTMENT
(a) The Trust is engaged in the business of investing and reinvesting its
assets in securities of the type and in accordance with the limitations
specified in the Trust's Trust Instrument, By-Laws and registration
statement filed with the Securities and Exchange Commission (the "SEC"),
under the Act and the Securities Act of 1933, as amended (the "Securities
Act"), including any representations made in a prospectus ("Prospectus") or
statement of additional information ("SAI") relating to a Fund contained
therein and as may be supplemented from time to time, all in such manner
and to such extent as may from time to time be authorized by the Trust's
Board of Trustees (the "Board"). The Trust is currently authorized to issue
the Shares and the Board is authorized to issue any unissued shares in any
number of additional series or classes. The Trust has delivered to Forum
copies of the documents listed in this Section and will from time to time
furnish Forum with any amendments thereof.
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(b) The Trust hereby appoints Forum as the principal underwriter and
distributor of the Funds to sell the Shares of the Funds to the public and
hereby agrees during the term of this Agreement to sell Shares of the Funds
to Forum upon the terms and conditions herein set forth.
SECTION 2. EXCLUSIVE NATURE OF DUTIES
Forum shall be the exclusive representative of the Trust to act as
principal underwriter and distributor of the Funds except that the rights given
under this Agreement to Forum shall not apply to Shares issued in connection
with the merger or consolidation of any other investment company with a Fund; a
Fund's acquisition by purchase or otherwise of all or substantially all of the
assets or stock of any other investment company; or the reinvestment in Shares
by a Fund's shareholders of dividends or other distributions or any other
offering by the Trust of securities to its stockholders.
SECTION 3. PURCHASE OF SHARES FROM THE TRUST; OFFERING OF SHARES
(a) Forum shall have the right to buy from the Trust the Shares needed to fill
unconditional orders for unsold Shares of the Funds as shall then be
effectively registered under the Securities Act placed with Forum by
investors or securities dealers or depository institutions or other
financial intermediaries acting as agent for their customers.
Alternatively, Forum may act as the Trust's agent, to offer, and to solicit
offers to subscribe to, unsold Shares of the Funds as shall then be
effectively registered under the Securities Act. Forum will promptly
forward all orders and subscriptions to the Trust. The price which Forum
shall pay for Shares purchased from the Trust and the price that Forum
shall offer Shares shall be the net asset value, determined as set forth in
Section 3(c) hereof, used in determining the public offering price on which
such orders are based. Shares purchased by Forum are to be resold by Forum
to investors at the public offering price, as set forth in Section 3(b)
hereof, or to securities dealers, depository institutions or other
financial intermediaries acting as agent for their customers that have
entered into agreements with Forum pursuant to Section 9 hereof. The Trust
reserves the right to sell Shares of the Funds directly to investors
through subscriptions received by the Trust, but no such direct sales shall
affect the sales charges due to Forum hereunder.
(b) The public offering price of the Shares of a Fund, i.e., the price per
Share at which Forum or selected dealers or selected agents (each as
defined in Section 9 hereof) may sell Shares to the public (or, in the case
of Exchange Shares of Ready Cash Investment Fund ("RCIF"), to shareholders
of B Shares or such other classes of Shares of a Fund as may from time to
time be permissible), shall be the public offering price determined in
accordance with the then currently effective Prospectus and SAI of the Fund
or class thereof under the Securities Act, relating to such Shares, but not
to exceed the net asset value at which Forum, when acting as principal, is
to purchase such Shares, plus, in the case of Shares for which an initial
sales charge is assessed, an initial charge equal to a specified percentage
or percentages of the public offering price of the Shares as set forth in
the current Prospectus relating to the Shares. In the case of Shares for
which an initial sales charge may be assessed, Shares may be sold to
certain classes of persons at reduced sales charges or without any sales
charge as from time to time set forth in the current Prospectus and SAI
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relating to the Shares. The Trust will advise Forum of the net asset value
per Share on any date requested by Forum and at such other times as it
shall have been determined by the Trust.
(c) The net asset value of Shares of the Funds shall be determined by the
Trust, or any agent of the Trust, as of the close of the New York Stock
Exchange on each Fund business day in accordance with the method set forth
in the Prospectus and SAI and guidelines established by the Board.
(d) 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 Forum shall cease to offer Shares of the
Funds specified in the notice.
(e) The Trust, or any agent of the Trust designated in writing to Forum by the
Trust, shall be promptly advised by Forum of all purchase orders for Shares
received by Forum and all subscriptions for Shares obtained by Forum as
agent 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 agent) will
confirm orders and subscriptions upon their receipt, will make appropriate
book entries and, upon receipt by the Trust (or its agent) of payment
thereof, will issue such Shares in certificated or uncertificated form
pursuant to the instructions of Forum. Forum agrees to cause such payment
and such instructions to be delivered promptly to the Trust (or its agent).
SECTION 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 Trust's Trust Instrument and in accordance with the applicable
provisions set forth in the Prospectus and SAI relating to the Shares of
the Fund. The price to be paid to redeem or repurchase the Shares of a Fund
shall be equal to the net asset value calculated in accordance with the
provisions of Section 3(b) hereof less, in the case of Shares for which a
deferred sales charge is assessed, a deferred sales charge equal to a
specified percentage or percentages of the net asset value of those Shares
as from time to time set forth in the Prospectus relating to those Shares
(or, in the case of Exchange Shares of RCIF, relating to Exchange Shares
and the original B Shares) or their cost (or, in the case of Exchange
Shares of RCIF, the cost of the B Shares of a Fund that were first
purchased by the shareholder and then exchanged, either directly or
indirectly through a series of exchanges, for the Exchange Shares (the
"Original B Shares")), whichever is less. Shares of a Fund or class thereof
for which a deferred sales charge may be assessed and that have been
outstanding for a specified period of time may be redeemed without payment
of a deferred sales charge as from time to time set forth in the Prospectus
relating to those Shares (or, in the case of Exchange Shares of RCIF,
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relating to the Original B Shares). All payments by the Trust hereunder
shall be made in the manner set forth below.
(b) The Trust (or its agent) shall pay the total amount of the redemption price
consisting of the redemption price less any applicable deferred sales
charge to the redeeming shareholder or its agent, and, except as may be
otherwise required by the Rules of Fair Practice of the National
Association of Securities Dealers, Inc. (the "NASD") and any
interpretations thereof, the deferred sales charges, if any, as defined in
the above paragraph pursuant to the instructions of Forum, in each case in
New York Clearing House funds on or before the seventh business day
subsequent to the Trust or its agent having received the notice of
redemption in proper form. Notwithstanding the termination of this
Agreement, Forum shall be entitled to receive its Allocable Portion (as
defined in Appendix B hereto) of all contingent deferred sales charges
("CDSCs") paid or payable with respect to the Shares in accordance with
Section 4(b) hereof.
(c) Redemption of Shares or payment 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, by order, so permits.
SECTION 5. COMPENSATION
(a) The Trust will pay Forum in consideration of its services in connection
with the distribution of Shares of each Fund its allocable portion
("Allocable Portion") (as determined in accordance with Appendix B to this
Agreement) of the distribution servicing fees allowable under the NASD
Rules of Fair Practice as in effect from time to time (the "NASD Rules") in
respect of such Shares of such Fund, which fee (the "Distribution Fee")
shall accrue daily and be paid monthly as promptly as possible after the
last day of each calendar month but in any event prior to the tenth (10th)
day of the following calendar month, at an annual rate set forth in the
distribution plan dated August 1, 1995 as amended July 28, 1998 (the
"Plan"), together with a separate interest fee thereon, as determined in
accordance with Section 3(c) of the Plan.
Forum will be deemed to have fully earned its Allocable Portion of the
Distribution Fee payable in respect of Shares of each Fund upon the sale of the
"Commission Shares" (as defined in Appendix B to this Agreement) of such Fund
taken into account in determining Forum's Allocable Portion of such Distribution
Fee.
(b) The Trust shall cause its transfer agent (the "Transfer Agent") to
withhold, from redemption proceeds payable to holders of Shares of the
Funds, all CDSCs properly payable by such holders in accordance with the
terms of the Prospectus relating to such Shares and shall cause the
Transfer Agent to pay such amounts over as promptly as possible after the
settlement date for each redemption of such Shares. Forum's Allocable
Portion of CDSC shall be payable to Forum (or to persons to whom Forum
directs the Trust to make payments).
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(c) Forum may direct the Trust to pay any part or all of the Distribution Fee
or CDSCs payable to Forum in respect of any Shares of any Fund directly to
persons providing funds to Forum to cover or otherwise enable the incurring
of expenses associated with distribution services, and the Trust agrees to
accept and to comply with such direction. Forum shall, at its own expense
and not the expense of the Trust or any Fund, provide the Trust with any
necessary calculations of Forum's Allocable Portion of any Distribution Fee
or CDSCs, and the Trust shall be entitled to rely conclusively on such
calculations, without prejudice to any claim it may have concerning the
accuracy of such calculations.
(d) Notwithstanding anything to the contrary contained in this Agreement or in
any relevant Plan, (a) the amount of asset-based sales charges and CDSCs
paid to Forum by any class of Shares of any Fund shall not exceed the
amount permitted by the NASD Rules, as in effect from time to time, and (b)
the aggregate amount of asset-based sales charges and CDSCs paid to Forum
by any class of Shares of any Fund shall not exceed six and one-quarter
percent (6 1/4%) of the total issue price of such Shares plus interest
thereon from the date of issuance through the date of payment at the prime
rate (determined in accordance with the NASD Rules in effect from time to
time) plus one percent (1%) per annum.
(e) The Trust will pay to Forum each month a maintenance fee with respect to
each Fund or class thereof in the amounts, for the periods, and at the
annual rates set forth in the Prospectus relating to the Shares of the
Fund.
(f) Except as provided in clauses (a), (b) and (e) of Section 5 hereof, Forum
shall be entitled to no compensation for its services hereunder.
SECTION 6. ASSIGNMENT
(a) Forum may, from time to time, assign, transfer or pledge ("Transfer") to
one or more designees (each an "Assignee"), its rights to all or a
designated portion of (I) the Forum's Allocable Portion of the Distribution
Fees (but not Forum's duties and obligations pursuant hereto or pursuant to
the Plan), and (ii) Forum's Allocable Portion of CDSCs, free and clear of
any offsets or claims the Trust may have against Forum. Each such
Assignee's interest in a designated portion of a Forum's Allocable Portion
of the Distribution Fees and a Forum's Allocable Portion of CDSCs is
hereinafter referred to as an "Assignee's 12b-1 Portion" and an "Assignee's
CDSC Portion," respectively. A Transfer pursuant to this Section 6(a) shall
not reduce or extinguish any claim of the Trust against Forum.
(b) Forum shall promptly notify the Trust in writing of each Transfer pursuant
to Section 6(a) hereof by providing the Trust with the name and address of
each such Assignee.
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(c) In connection with a Transfer Forum may direct the Trust to pay all of such
Distributor's Allocable Portion of the Distribution Fees and the
Distributor's Allocable Portion of CDSCs from time to time to a depository
or collection agent designated by any Assignee, which depository or
collection agent may be delegated the duty of dividing the Distributor's
Allocable Portion of the Distribution Fees and the Distributor's Allocable
Portion of CDSC between the Assignee's 12b-1 Portion and Assignee's CDSC
Portion and the balance of Distributor's Allocable Portion (such balance,
when distributed to Forum by the depository or collection agent,
"Distributor's 12b-1 Share") and of the Distributor's Allocable Portion of
CDSCs (such balance, when distributed to Forum by the depository or
collection agent, the "Distributor's Earned CDSC Portion"), in which case
only Distributor's 12b-1 Share and the Distributor's Forum's Earned CDSC
Portion may be subject to offsets or claims the Trust may have against
Forum.
(d) The Trust shall not amend the Plan to reduce the amount payable to Forum or
any Assignee under Section 5(a) hereof with respect to the B Shares for any
B Shares which have been issued prior to the date of such amendment.
SECTION 7. DUTIES AND REPRESENTATIONS OF THE TRUST
(a) The Trust shall furnish to Forum copies of all information, financial
statements and other papers which Forum may reasonably request for use in
connection with the distribution of Shares of the Funds, including, upon
request by Forum, one certified copy of all financial statements prepared
for the Funds by independent public accountants. The Trust shall make
available to Forum such number of copies of the Funds' Prospectuses and
SAIs as Forum shall reasonably request.
(b) The Trust shall take, from time to time, subject to the approval of its
Trustees and any required approval of its shareholders, all action
necessary to fix the number of authorized shares of the Funds (if such
number is not limited) and to register the Shares under the Securities Act,
to the end that there will be available for sale such number of Shares as
Forum reasonably may be expected to sell.
(c) The Trust and Forum will cooperate with each other in taking such action as
may be necessary to qualify Shares for sale under the securities laws of
such states and other jurisdictions as the Trust may designate; provided
that Forum shall not be required to register as a broker-dealer or file a
consent to service of process in such states. Any such qualification may be
withheld, terminated or withdrawn by the Trust at any time in its
discretion. Forum shall furnish such information and other material
relating to its affairs and activities as may be required by the Trust in
connection with such qualification. The Trust will pay all fees and
expenses of registering Shares under the Securities Act and of
qualification and the maintenance of qualification of Shares and its
qualification under applicable state securities laws. Forum shall pay all
expenses relating to Forum's broker-dealer qualification.
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(d) The Trust will furnish, in reasonable quantities upon request by Forum,
copies of annual and interim reports of the Funds.
(e) The Trust represents that its Registration Statement under the Securities
Act and the Trust's Prospectuses included therein (as in effect from time
to time) 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 of the SEC thereunder. The Trust represents and warrants that
its 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 of the SEC, and that all statements of
fact contained or to be contained therein are or will be true and correct
at the time indicated or on the effective date as the case may be; that
neither its Registration Statement nor its Prospectuses, 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. The Trust will from time to time file such amendment
or amendments to its Registration Statement and Prospectuses as, in the
light of future developments, shall, in the opinion of its counsel, be
necessary in order to have its 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, but, if the Trust shall not file such amendment or amendments
within fifteen days following receipt of a written request from Forum to do
so, Forum may, at its option, terminate this agreement immediately. The
Trust shall not file any amendment to its Registration Statement or
Prospectuses without giving Forum reasonable notice thereof in advance;
provided, however, that nothing contained in this agreement shall in any
way limit the Trust's right to file at any time such amendments to its
Registration Statement or Prospectuses, of whatever character, as the Trust
may deem advisable, such right being in all respects absolute and
unconditional. The Trust represents and warrants that any amendment to its
Registration Statement or Prospectuses hereafter filed will, when they
becomes effective, contain all statements required to be stated therein in
accordance with the Act and the rules and regulations of the SEC, that all
statements of fact contained therein will, when the same shall become
effective, be true and correct and that 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.
SECTION 8. DUTIES OF FORUM
(a) Forum shall use its best efforts to sell Shares of the Funds upon the terms
and conditions contained herein and in the then current Prospectus. Forum
shall devote reasonable time and effort to effect sales of Shares of the
Funds, but shall not be obligated to sell any specific number of Shares.
The services of Forum to the Trust hereunder are not to be deemed exclusive
and nothing herein contained shall prevent Forum from entering into like
arrangements with other investment companies so long as the performance of
its obligations hereunder is not impaired thereby.
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(b) In selling Shares of the Funds, Forum 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 such securities. None of Forum, 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 and SAI, as from time to time in
effect, or any sales literature specifically approved in writing by the
Trust.
(c) Forum shall adopt and follow procedures, as approved by the officers of the
Trust, 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 as may from time to time exist.
SECTION 9. SELECTED DEALER AND SELECTED AGENT AGREEMENTS
Forum 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 of the Funds and to fix
therein the portion of the sales charge 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 the compensation set
forth therein. Shares of each Fund shall be resold by selected dealers or
selected agents only at the public offering price(s) set forth in the Prospectus
and SAI relating to the Shares of the Fund. Within the United States, Forum
shall offer and sell Shares of the Funds only to such selected dealers as are
members in good standing of the NASD.
SECTION 10. PAYMENT OF EXPENSES
(a) The Trust shall bear all costs and expenses of the Funds, including fees
and disbursements of its counsel and auditors, in connection with the
preparation and filing of its Registration Statement and Prospectuses and
SAIs and all amendments and supplements thereto and the preparing and
mailing of annual and interim reports and proxy materials to shareholders
(including but not limited to the expense of setting in type any
registration statements, prospectuses, annual or interim reports or proxy
materials).
(b) The Trust shall bear the cost and expenses of the qualification of Shares
of the Funds for sale, and, if necessary or advisable in connection
therewith, of qualifying the Trust (but not Forum) as an issuer or as a
broker or dealer, in such states of the United States or other
jurisdictions as shall be selected by the Trust and Forum pursuant to
Section 7(c) hereof and the costs and expenses payable to each state or
jurisdiction for continuing qualification therein until the Trust decides
to discontinue qualification pursuant to Section 7(c) hereof.
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SECTION 11. INDEMNIFICATION OF FORUM
The Trust agrees to indemnify, defend and hold Forum, and any person
who controls Forum 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 cost of investigating or defending such claims, demands
or liabilities and any counsel fees incurred in connection therewith) which
Forum or any such controlling person may incur, under the Securities Act, or
under common law or otherwise, arising out of or based upon any alleged untrue
statement of a material fact contained in the Trust's Registration Statement or
the Prospectuses or SAIs in effect from time to time under the Securities Act or
arising out of or based upon any alleged omission to state a material fact
required to be stated in any one thereof or necessary to make the statements in
any one thereof not misleading; provided, however, that in no event shall
anything herein contained be so construed as to protect Forum against any
liability to the Trust or its security holders to which Forum would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of Forum's reckless disregard of its
obligations and duties under this Agreement. The Trust's agreement to indemnify
Forum and any such controlling person as aforesaid is expressly conditioned upon
the Trust's being notified of the commencement of any action brought against
Forum or any such controlling person, such notification to be given by letter or
by telegram addressed to the Trust at its principal office in New York, New
York, and sent to the Trust by the person against whom such action is brought
within ten days after the summons or other first legal process shall have been
served. The Trust will be entitled to assume the defense of any suit brought to
enforce any such claim and to retain counsel of good standing chosen by the
Trust and approved by Forum. In the event the Trust elects to assume the defense
of any such suit and retain counsel of good standing approved by Forum, the
defendants in the 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 the suit or in case Forum does not approve of counsel chosen by
the Trust, the Trust will reimburse Forum or the controlling person or persons
named defendant or defendants in the suit for the fees and expenses of any
counsel retained by Forum or such persons. The indemnification agreement
contained in this Section shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of Forum or any controlling
person and shall survive the sale of any of a Fund's Shares made pursuant to
subscriptions obtained by Forum. This agreement of indemnity will inure
exclusively to the benefit of Forum, to the benefit of its successors and
assigns, and to the benefit of any controlling persons and their successors and
assigns. The Trust agrees promptly to notify Forum of the commencement of any
litigation or proceeding against the Trust in connection with the issue and sale
of any of the Shares of the Funds. The failure to notify the Trust of the
commencement of any such action shall not relieve the Trust from any liability
which it may have to the person against whom the action is brought by reason of
any alleged untrue statement or omission otherwise than on account of the
indemnity agreement contained in this Section.
SECTION 12. INDEMNIFICATION OF THE TRUST
Forum agrees to indemnify, defend and hold the Trust, its several
officers and trustees, 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 cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which the Trust, its officers or
trustees, or any such controlling person may incur under the Securities Act or
under common law or otherwise, but only to the extent that such liability or
expense incurred by the Trust, its officers and trustees or controlling person
resulting from such claims or demands shall arise out of or be based upon (I)
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any alleged untrue statement of a material fact contained in information
furnished in writing by Forum to the Trust for use in its Registration Statement
insofar as it relates to a Fund or the Prospectuses or SAIs relating to a Fund
in effect from time to time under the Securities Act, (ii) any alleged omission
to state a material fact in connection with such information required to be
stated in the Registration Statement, a Prospectus or a SAI or necessary to make
the information not misleading or (iii) willful misfeasance, bad faith or gross
negligence in the performance by Forum of its duties, or by reason of Forum's
reckless disregard of its obligations and duties under this Agreement. Forum's
agreement to indemnify the Trust, its officers and trustees and any controlling
person as aforesaid is expressly conditioned upon Forum being notified of the
commencement of any action brought against the Trust, its officers or trustees
or any controlling person, such notification to be given by letter or telegram
addressed to Forum at its principal office in New York, New York, and sent to
Forum by the person against whom the action is brought, within ten days after
the summons or other first legal process shall have been served. Forum will be
entitled to assume the defense of the action, with counsel in good standing of
its own choosing approved by the Trust, if the action is based solely upon
alleged misstatement, omission or action described in clauses (I), (ii) or
(iii), above and in any other event Forum and the Trust, and their officers and
trustees or controlling persons, shall each have the right to participate in the
defense or preparation of the defense of any such action. In the event Forum
elects to assume the defense of any such suit and retain counsel of good
standing approved by the Trust, the defendants in the suit shall bear the fees
and expenses of any additional counsel retained by any of them; but in case
Forum does not elect to assume the defense of the suit or in case the Trust does
not approve of counsel chosen by Forum, Forum will reimburse the Trust or the
controlling person or persons named defendant or defendants in the suit for the
fees and expenses of any counsel retained by the Trust or such persons. The
indemnification agreement contained in this Section shall remain operative and
in full force and effect regardless of any investigation made by or on behalf of
the Trust or any controlling person and shall survive the sale of any of the
Shares made pursuant to orders or subscriptions obtained by Forum. This
agreement of indemnity will inure exclusively to the benefit of the Trust, to
the benefit of its successors and assigns, and to the benefit of any controlling
persons and their successors and assigns. Forum agrees promptly to notify the
Trust of the commencement of any litigation or proceeding against Forum in
connection with the issue and sale of any of the Shares. The failure to notify
Forum of the commencement of any action shall not relieve Forum from any
liability which it may have to the Trust, to its officers and trustees, or to
controlling persons by reason of any untrue statement or omission on the part of
or action by Forum otherwise than on account of the indemnity agreement
contained in this Section.
SECTION 13. NOTIFICATION BY THE TRUST
The Trust agrees to advise Forum immediately:
(a) of any request by the SEC for amendments to the Trust's Registration
Statement insofar as it relates to the Funds, a Fund's Prospectus or
SAI or for additional information,
(b) in the event of the issuance by the SEC of any stop order suspending
the effectiveness of the Trust's Registration Statement insofar as it
relates to the Funds, a Fund's Prospectus or SAI or the initiation of
any proceeding for that purpose,
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(c) of the happening of any material event which makes untrue any statement
made in the Trust's Registration Statement insofar as it relates to the
Funds or any Fund's Prospectus or SAI or which requires the making of a
change in either thereof in order to make the statements therein not
misleading, and
(d) of all actions of the SEC with respect to any amendments to the Trust's
Registration Statement insofar as it relates to the Funds, a Fund's
Prospectus or SAI which may from time to time be filed with the SEC under
the Securities Act.
SECTION 14. EFFECTIVENESS, DURATION AND TERMINATION
(a) This Agreement shall become effective with respect to each Fund on the date
hereof. Upon effectiveness of this Agreement, it shall supersede all
previous agreements between the parties hereto covering the subject matter
hereof insofar as such Agreement may have been deemed to relate to the
Funds.
(b) This Agreement shall continue in effect with respect to a Fund for a period
of one year from the date of its effectiveness and shall continue in effect
for successive one-year periods with respect to the Fund; provided,
however, that continuance is specifically approved at least annually (I) by
the Board or by a vote of a majority of the outstanding voting securities
of the Fund and (ii) by a vote of a majority of Trustees of the Trust (I)
who are not parties to this Agreement or interested persons of any such
party (other than as Trustees of the Trust) and (II) with respect to each
class of a Fund for which there is an effective plan of distribution
adopted pursuant to Rule 12b-1 under the Act, who do not have any direct or
indirect financial interest in any such plan applicable to the class or in
any agreements related to the plan, cast in person at a meeting called for
the purpose of voting on such approval; provided further, however, that if
the continuation of this Agreement is not approved as to a Fund, Forum may
continue to render to the Fund the services described herein in the manner
and to the extent permitted by the Act and the rules and regulations
thereunder.
(c) This Agreement may be terminated at any time with respect to a Fund,
without the payment of any penalty, (I) by the Board or by a vote of a
majority of the outstanding voting securities of the Fund or, with respect
to each class of a Fund for which there is an effective plan of
distribution adopted pursuant to Rule 12b-1 under the Act, a majority of
Trustees of the Trust who do not have any direct or indirect financial
interest in any such plan or in any agreements related to the plan, on 60
days' written notice to Forum or (ii) by Forum on 60 days' written notice
to the Trust.
(d) This Agreement shall also automatically terminate in the event of its
assignment, the term "assignment" having the meaning set forth in Section
2(a)(4) of the Act; provided, that the Transfer of Forum's rights to the
Distributor's 12b-1 Portion or the Distributor's Earned CDSC shall not
cause a termination of this Agreement or be deemed to be an assignment for
purposes of this Section 14(d).
11
(e) Subject to the provisions of the following sentence, if this Agreement is
terminated for any reason other than a Complete Termination (as defined in
Section 10 of the Plan), the obligations of the Trust and Forum pursuant to
Sections 5(a)-(d) and 6(a)-(d) of this Agreement will continue and survive
any such termination. A termination of the Plan (including a Complete
Termination as defined in Section 10 of the Plan) with respect to any or
all Shares of any or all Funds shall not affect the obligations of the
Trust with respect to payments of the Distributor's Allocable Portion of
CDSC or Assignee's Allocable Portion of CDSC or of the obligations of Forum
in respect of CDSC's pursuant to Sections 5 and 6 of this Agreement.
SECTION 15. NOTICES
Any notice required or permitted to be given hereunder by either party
to the other shall be deemed sufficiently given if personally delivered or sent
by telegram or registered, certified or overnight mail, postage prepaid,
addressed by the party giving such notice to the other party at the last address
furnished by the other party to the party giving such notice, and unless and
until changed pursuant to the foregoing provisions hereof each such notice shall
be addressed to the Trust or Forum, as the case may be.
SECTION 16. ACTIVITIES OF FORUM
Except to the extent necessary to perform Forum's obligations
hereunder, nothing herein shall be deemed to limit or restrict Forum's right, or
the right of any of Forum's officers, directors or employees who may also be a
trustee, officer or employee of the Trust, or persons otherwise affiliated with
the Trust to engage in any other business or to devote time and attention to the
management or other aspects of any other business, whether of a similar or
dissimilar nature, or to render services of any kind to any other corporation,
trust, firm, individual or association.
SECTION 17. LIMITATION OF SHAREHOLDER AND TRUSTEE LIABILITY
The Trustees of the Trust and the shareholders of each Fund shall not
be liable for any obligations of the Trust or of the Funds under this Agreement,
and Forum agrees that, in asserting any rights or claims under this Agreement,
it shall look only to the assets and property of the Trust or the Fund to which
Forum's rights or claims relate in settlement of such rights or claims, and not
to the Trustees of the Trust or the shareholders of the Funds.
SECTION 18. MISCELLANEOUS
(a) No provisions of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed
by both parties hereto.
(b) Section headings in this Agreement are included for convenience only
and are not to be used to construe or interpret this Agreement.
12
(c) The provisions of this Agreement shall be, to the extent applicable,
construed and interpreted in accordance with the laws of the State of
New York.
(d) The terms "vote of a majority of the outstanding voting securities,"
"interested person," "affiliated person" and "assignment" shall have
the meanings ascribed thereto in the Act.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
NORWEST ADVANTAGE FUNDS
By:__________________________
Xxxxxx X. Xxxxxxxxx
Trustee
FORUM FINANCIAL SERVICES, INC.
By:________________________
Xxxxx X. Xxxxxxxxx
Secretary
13
NORWEST ADVANTAGE FUNDS
DISTRIBUTION SERVICES AGREEMENT
Appendix A
Funds and Classes of the Trust
as of July 27, 1999
Funds Classes
----- -------
Cash Investment Fund Single existing class
Ready Cash Investment Fund Public Entities Shares, Investor Shares and
Exchange Shares
U.S. Government Fund Single existing class
Treasury Plus Fund Single existing class
Treasury Fund Single existing class
Municipal Money Market Fund Institutional Shares and Investor Shares
Stable Income Fund A Shares, B Shares and I Shares
Limited Term Government Income Fund I Shares
Intermediate Government Income Fund A Shares, B Shares and I Shares
Diversified Bond Fund I Shares
Income Fund A Shares, B Shares and I Shares
Total Return Bond Fund A Shares, B Shares and I Shares
Limited Term Tax-Free Fund I Shares
Tax-Free Income Fund A Shares, B Shares and I Shares
Colorado Tax-Free Fund A Shares, B Shares and I Shares
Minnesota Intermediate Tax-Free Fund I Shares
Minnesota Tax-Free Fund A Shares, B Shares and I Shares
Strategic Income Fund I Shares
Moderate Balanced Fund I Shares
Growth Balanced Fund A Shares, B Shares, C Shares and I Shares
Aggressive Balanced-Equity Fund I Shares
Index Fund I Shares
Income Equity Fund A Shares, B Shares, C Shares and I Shares
ValuGrowth Stock Fund A Shares, B Shares and I Shares
Diversified Equity Fund A Shares, B Shares, C Shares and I Shares
Growth Equity Fund A Shares, B Shares, C Shares and I Shares
Large Company Growth Fund A Shares, B Shares and I Shares
Diversified Small Cap Fund A Shares, B Shares and I Shares
Small Company Stock Fund A Shares, B Shares and I Shares
Small Company Growth Fund I Shares
Small Cap Opportunities Fund A Shares, B Shares and I Shares
International Fund A Shares, B Shares and I Shares
Performa Strategic Value Bond Fund Single existing class
Performa Disciplined Growth Fund Single existing class
Performa Small Cap Value Fund Single existing class
Performa Global Growth Fund Single existing class
Norwest WealthBuilder II Growth Portfolio C Shares
Norwest WealthBuilder II Growth and Income Portfolio C Shares
Norwest WealthBuilder II Growth Balanced Portfolio C Shares
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NORWEST ADVANTAGE FUNDS
DISTRIBUTION SERVICES AGREEMENT
October 1, 1995
Amended April 26, 0000
Xxxxxxxx X
Forum's "Allocable Portion" of the CDSCs and Distribution Fees in
respect of a Fund shall be 100 percent until such time as Forum shall cease to
serve as exclusive distributor of such Shares and thereafter shall be recomputed
first on the date of any termination of Forum's services as exclusive
distributor of Shares of any Fund and thereafter periodically (but not less than
monthly), in accordance with Parts B & C below based upon the number of
representing the Shares of such Fund outstanding on each such computation date
allocated to Forum in accordance with Part A below:
For Purposes of this Appendix B defined terms used herein shall have
the meaning assigned to such terms in the Distribution Agreement and the
following terms shall have the following meanings:
"Commission Share" shall mean, in respect of any Fund, each Share of
such Fund which is issued under circumstances which would normally give rise to
an obligation of the holder of such Share to pay a CDSC upon redemption of such
Share, including, without limitation, any Share of such Fund issued in
connection with a Permitted Free Exchange, and any such Share shall not cease to
be a Commission Share prior to the redemption (including a redemption in
connection with a Permitted Free Exchange) or conversion even though the
obligation to pay the CDSC shall have expired or conditions for waivers thereof
shall exist.
"Date of Original Issuance" means in respect of any Commission Share of
any Eligible Fund, the date with reference to which the amount of the CDSC
payable on redemption thereof is computed.
"Free Share" shall mean, in respect of any Fund, each Share of such
Fund other than a Commission Share, including, without limitation, each Share
issued in connection with the reinvestment of dividends.
"Other Distributor" shall mean in respect of the Shares of any Fund,
each entity appointed from time to time as the exclusive distributor for such
Shares of the Fund after Forum ceases to serve in that capacity.
"Permitted Free Exchange" with respect to any Shares of any Fund, shall
mean an exchange of such Share for a Share of another Fund which pursuant to the
terms of the related Prospectus for such Shares, relieves or defers the CDSCs in
respect of such Share.
15
"Transfer Agent" shall mean, in respect of any Fund, the entity serving
as the transfer agent and who maintains accounts for each record holder of
Shares of such Fund including record holders which are record owners of Omnibus
Accounts.
PART A: ATTRIBUTION OF SHARES
Each class of Shares of each Fund, which are outstanding from time to
time, shall be attributed to either Forum or an Other Distributor in accordance
with the following rules:
(a) Commission Shares: (a) The Commission Shares of each class of Shares of
each Fund outstanding from time to time shall be attributed to Forum or
such Other Distributor based on the Date of Original Issuance of such
Commission Shares, with those having a Date of Original Issuance which
occurs during the period in which Forum was the exclusive distributor
for such Fund in respect of such class of Shares of such Fund being
attributed to Forum.
(b) A Commission Share of a Fund (the "First Fund") issued in consideration
of the investment of proceeds of the redemption of a Commission Share
of another Fund (the "Second Fund") in connection with a Permitted Free
Exchange, is deemed to have a Date of Original Issuance identical to
the Date of Original Issuance of the Commission Share of the Second
Fund which was so redeemed and any such Commission Share will be
attributed to Forum or such Other Distributor based upon such Date of
Original Issuance in accordance with rule (a) above.
(c) A Commission Share of a Fund which is redeemed other than in connection
with a Permitted Free Exchange or is converted to a class A share at
the end of the autoconversion period is deemed to reduce the number of
outstanding Commission Shares attributed to Forum or such Other
Distributor based upon the Date of Original Issuance of such Commission
Share in accordance with rule (a) above.
(d) Free Shares.
(e) Free Shares outstanding on the date of termination of Forum's services
as exclusive distributor will be attributed to Forum or such Other
Distributor in the same proportion that Commission Shares were
attributed to each on such date.
(f) Thereafter Free Shares which are issued during any period in connection
with the reinvestment of dividends or other distributions or in
connection with the reinvestment of proceeds of redemption of Free
Shares of another Fund will be attributed to Forum and such Other
Distributor based upon the percentage of total Free Shares and
Commission Shares of such Fund which were outstanding at the
commencement of such period which were attributed to each at the
commencement of such period under these rules.
16
(g) Free Shares which are redeemed (whether in connection with the
reinvestment of the proceeds of such redemption in Shares of another
Fund or otherwise) or converted into class A shares of such Fund during
any period after the date of termination of Forum's services will be
deemed to come out of the Free Shares of such Fund attributed to Forum
and such Other Distributor based upon the percentage of total Free
Shares and Commission Shares of such Eligible Fund which were
outstanding at the commencement of such period which was attributed to
each at the commencement of such period under these rules.
PART B: ALLOCATION OF DISTRIBUTION FEES.
The portion of the Distribution Fees accruing in respect of Shares of a
Fund during a particular calendar month are allocated to Forum and Other
Distributor determined by multiplying the total of such Distribution Fees
accruing during a particular calendar month by the following fraction:
((BTS x BNAV) + (ETS x ENAV))/2
--------------------------------------------------------------------------------
((BPS x BNAV) + (EPS x ENAV))/2
where:
BTS = Total Number of Shares of such Fund attributed to Forum or
such Other Distributor and outstanding at the beginning of
such calendar month
BNAV = Per Share Net Asset Value of Shares of such Fund at the beginning of such
calendar month
ETS = Total Number of Shares of such Fund attributed to Forum or
such Other Distributor and outstanding at the end of such
calendar month
ENAV = Per Share Net Asset Value of Shares of such Fund at the end of such
calendar month
BPS = Total Number of Shares of such Fund outstanding at the beginning of such
calendar month
EPS = Total Number of Shares of such Eligible Fund outstanding at the end of
such calendar month
PART C: ALLOCATION OF CDSCs
CDSCs will be allocated to either Forum or a Other Distributor based
upon whether the Commission Share giving rise to such CDSC was attributed to
Forum or such Other Distributor in accordance with Part A above.
17
PART D: ALLOCATION PROCEDURES FOR SHARES HELD THROUGH AN
ACCOUNT MAINTAINED IN THE NAME OF AN INTERMEDIARY
In the case of Shares of a Fund held through an account maintained in
the name of a broker-dealer or other intermediary, the allocation procedures
contained in this Appendix B shall be amplified as Forum and the Trust shall
agree to ensure the appropriate attribution of, and allocation of distribution
services fees attributable to those shares.
PART E:
If the Fund transfer agent is one day able to trace each Free Share to
the Commission Share from which such Free Share was derived and the methodology
for allocating Free Shares described above results in significant economic
inequities in the allocation of Distribution Fees as compared to an allocation
method which is based upon a more accurate tracking of such Free Shares, then
the Fund will work in good faith with Forum and any Other Distributor to revise
the allocation procedures described above to remove such inequities.
18
