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EXHIBIT 6(e)
[FORM]
DISTRIBUTION AGREEMENT
THIS AGREEMENT is made as of this ____ day of January, 1997, by and
between Northern Funds, a Massachusetts business trust ("Northern Funds") and
Sunstone Distribution Services, LLC, a Wisconsin limited liability company (the
"Distributor").
W I T N E S S E T H:
WHEREAS, Northern Funds is registered under the Investment Company Act
of 1940, as amended (the "1940 Act"), as an open-end management investment
company and is authorized to issue shares of beneficial interest ("Shares") in
separate series with each such series representing the interests in a separate
portfolio of securities and other assets;
WHEREAS, the Distributor is registered as a broker-dealer under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and is a member in
good standing of the National Association of Securities Dealers, Inc. (the
"NASD"); and
WHEREAS, the Fund and Distributor desire to enter into an agreement
pursuant to which Distributor shall be the distributor of the Shares of Northern
Funds representing the investment portfolios listed on Schedule A hereto and any
additional investment portfolios Northern Funds and Distributor may agree upon
and include on Schedule A as such Schedule may be amended from time to time
(such investment portfolios and any additional investment portfolios are
individually referred to as a "Fund" and collectively the "Funds").
NOW, THEREFORE, in consideration of the mutual promises and agreements
herein contained and other good and valuable consideration, the receipt of which
is hereby acknowledged, the parties hereto, intending to be legally bound, do
hereby agree as follows:
1. Appointment of the Distributor.
Northern Funds hereby appoints the Distributor as agent for
the distribution of the Shares, on the terms and for the period set forth in
this Agreement. Distributor hereby accepts such appointment as agent for the
distribution of the Shares on the terms and for the period set forth in this
Agreement.
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2. Services as Distributor.
2.1(a) Distributor will act as agent for the distribution of
Shares in accordance with the instructions of Northern Funds' Board of Trustees
and the registration statement and prospectuses then in effect with respect to
the Funds under the Securities Act of 1933, as amended (the "1933 Act"), and
will transmit promptly any orders received for the purchase or redemption of
Shares either directly to the transfer agent for the Funds or to any qualified
broker/dealer for transmittal to said agent.
2.1(b) Distributor shall use appropriate efforts to solicit
orders for the sale of Shares. Distributor, at its own expense, shall finance
appropriate activities which it deems reasonable which are primarily intended to
result in the sale of Shares, including, but not limited to, advertising, the
printing and mailing of prospectuses to other than current shareholders, and the
printing and mailing of sales literature. In addition, Distributor will provide
at least one person, during normal business hours, to respond to telephone
questions with respect to the Funds. Distributor may enter into servicing and/or
selling agreements with qualified broker/dealers and other persons with respect
to the offering of Shares to the public, and if it so chooses Distributor will
act only on its own behalf as principal. The Distributor shall not be obligated
to sell any certain number of Shares of any Fund.
2.1(c) All Shares of the Funds offered for sale by Distributor
shall be offered for sale to the public at a price per unit (the "offering
price") equal to their net asset value (determined in the manner set forth in
Northern Funds' then current prospectuses). The offering price, if not an exact
multiple of one cent, shall be adjusted to the nearest cent.
2.2 Distributor shall act as distributor of the Shares in
compliance with all applicable laws, rules and regulations, including, without
limitation, all rules and regulations made or adopted pursuant to the 1940 Act,
by the Securities and Exchange Commission (the "Commission") or any securities
association registered under the 1934 Act. Northern Funds represents that it is
registered as an open-end management investment company under the 1940 Act and
that it shall comply with all applicable laws, rules and regulations including
the 1933 Act, the 1934 Act and the 1940 Act and the rules and regulations
thereunder.
2.3 Whenever in their judgment such action is warranted by
market, economic or political conditions, or by circumstances of any kind,
Northern Funds' officers may decline to accept any orders for, or make any sales
of, any Shares until such time as they deem it advisable to accept such orders
and to make
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such sales and Northern Funds shall advise Distributor promptly of such
determination.
2.4 Northern Funds shall take all necessary action to register
and maintain the registration of the Shares under the 1933 Act for sale as
herein contemplated and shall pay all costs and expenses in connection with the
registration of Shares under the 1933 Act, and be responsible for all expenses
in connection with maintaining facilities for the issue and transfer of Shares
and for supplying information, prices and other data to be furnished by Northern
Funds hereunder.
2.5 Northern Funds shall execute any and all documents and
furnish any and all information and otherwise take all actions which may be
reasonably necessary in the discretion of Northern Funds' officers in connection
with the qualification of the Shares for sale in such states as Distributor and
Northern Funds may approve, and Northern Funds shall pay all expenses which may
be incurred in connection with such qualification. Distributor shall pay all
expenses connected with its own qualification as a broker under State or Federal
laws and, except as otherwise specifically provided in this Agreement, all other
expenses incurred by Distributor in connection with the sale by Distributor of
Shares as contemplated in this Agreement.
2.6 Northern Funds shall furnish Distributor from time to
time, for use in connection with the sale of Shares, such information with
respect to Northern Funds and the Shares as Distributor may reasonably request,
and Northern Funds warrants that the statements contained in any such
information shall be true and correct. Northern Funds also shall furnish
Distributor upon request with: (a) annual audited reports of Northern Funds'
books and accounts with respect to each of the Funds, made by independent public
accountants regularly retained by Northern Funds, (b) semi-annual reports with
respect to each of the Funds prepared by Northern Funds, and (c) from time to
time such additional information regarding Northern Funds' financial condition
as Distributor may reasonably request.
2.7 Northern Funds represents to Distributor that all
registration statements and prospectuses filed by Northern Funds with the
Commission under the 1933 Act with respect to the Shares have been prepared in
conformity with the requirements of the 1933 Act, the 1940 Act, and the rules
and regulations of the Commission thereunder. As used in this Agreement the
terms "registration statement" and "prospectus" shall mean any registration
statement and prospectus (together with the related statement of additional
information) at any time filed with the Commission with respect to any of the
Shares and any amendments and supplements thereto which at any time shall have
been filed with said Commission. Northern Funds represents and warrants to
Distributor that any registration statement and prospectus, when
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such registration statement becomes effective, will contain all statements
required to be stated therein in conformity with the 1933 Act, the 1940 Act and
the rules and regulations of the Commission; that all statements of fact
contained in the registration statement and prospectus will be true and correct
in all material respects when such registration statement becomes effective; and
that neither the registration statement nor any prospectus when such
registration statement becomes effective 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. Northern Funds agrees to file from time to time such amendments,
supplements, reports and other documents as may be necessary in order to comply
with the 1933 Act and the 1940 Act and in order that there may be no untrue
statement of a material fact in a registration statement or prospectus, or
necessary in order that there may be no omission to state a material fact in the
registration statement or prospectus which omission would make the statements
therein misleading. If Northern Funds shall not propose an amendment or
amendments and/or supplement or supplements within fifteen days after receipt by
Northern Funds of a written request from Distributor to do so, Distributor may,
at its option, terminate this Agreement. Northern Funds shall not file any
amendment to the registration statement or supplement to any prospectus without
giving Distributor reasonable notice thereof in advance; provided, however, that
nothing contained in this Agreement shall in any way limit Northern Funds' right
to file at any time such amendments to any registration statement and/or
supplements to any prospectus, of whatever character, as Northern Funds may deem
advisable, such right being in all respects absolute and unconditional.
2.8(a) Northern Funds authorizes Distributor to use any
prospectus, in the form furnished to Distributor from time to time, in
connection with the sale of Shares. Northern Funds shall indemnify, defend and
hold the Distributor, and each of its present or former directors, officers,
employees, representatives and any person who controls or previously controlled
the Distributor within the meaning of Section 15 of the 1933 Act, free and
harmless from and against any and all losses, claims, demands, liabilities,
damages and expenses (including the costs of investigating or defending any
alleged losses, claims, demands, liabilities, damages or expenses and any
counsel fees incurred in connection therewith) which Distributor, each of its
present and former directors, officers, employees or representatives or any such
controlling person, may incur under the 1933 Act, the 1934 Act, any other
statute (including Blue Sky laws) or any rule or regulation thereunder, or under
common law or otherwise, arising out of or based upon any untrue statement, or
alleged untrue statement, of a material fact contained in the registration
statement or any prospectus, as from time to time amended or supplemented, or an
annual or interim report to shareholders, or arising out of or
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based upon any omission, or alleged omission, to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading; provided, however, that Northern Funds' obligation to indemnify
Distributor and any of the foregoing indemnitees, shall not be deemed to cover
any losses, claims, demands, liabilities, damages or expenses arising out of any
untrue statement or alleged untrue statement or omission or alleged omission
made in the registration statement, prospectus, or annual or interim report in
reliance upon and in conformity with information furnished to Northern Funds or
its counsel by Distributor for the purpose of, and used in, the preparation
thereof; and provided further that Northern Funds' agreement to indemnify
Distributor and any of the foregoing indemnitees shall not be deemed to cover
any liability to Northern Funds or its shareholders to which Distributor would
otherwise be subject by reason of its willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of its reckless
disregard of its obligations and duties under this Agreement. Northern Funds'
agreement to indemnify the Distributor, and each of its present or former
directors, officers, employees, representatives or any controlling person, as
the case may be, with respect to any action, is expressly conditioned upon
Northern Funds being notified of such action brought against Distributor, or
each of its present or former directors, officers, employees, representatives or
any such controlling person, within a reasonable time after the summons or other
first legal process giving information of the nature of the claim shall have
been served upon the Distributor, or such person, such notification to be given
by letter or by telegram addressed to Northern Funds' Chairman, but the failure
so to notify Northern Funds of any such action shall not relieve Northern Funds
from any liability which Northern Funds 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 Northern Funds'
indemnity agreement contained in this paragraph 2.8(a).
2.8(b) Northern Funds shall be entitled to participate at its
own expense in the defense or, if it so elects, to assume the defense of any
suit brought to enforce any such loss, claim, demand, liability, damage or
expense, but if Northern Funds elects to assume the defense, such defense shall
be conducted by counsel chosen by Northern Funds and approved by the
Distributor, which approval shall not be unreasonably withheld. In the event
Northern Funds elects to assume the defense of any such suit and retain such
counsel, the indemnified defendant or defendants in such suit shall bear the
fees and expenses of any additional counsel retained by them. If Northern Funds
does not elect to assume the defense of any such suit, or in case the
Distributor does not, in the exercise of reasonable judgment, approve of counsel
chosen by Northern Funds, Northern Funds will reimburse the indemnified person
or persons named as defendant or defendants in such suit, for the fees
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and expenses of any counsel retained by Distributor and them. Northern Funds'
indemnification agreement contained in this paragraph 2.8 and Northern Funds'
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
the Distributor, and each of its present or former directors, officers,
employees, representatives or any controlling person, and shall survive the
delivery of any Shares and the termination of this Agreement. This Agreement of
indemnity will inure exclusively to the Distributor's benefit, to the benefit of
each of its present or former directors, officers, employees or representatives
or to the benefit of any controlling persons and their successors. Northern
Funds agrees promptly to notify Distributor of the commencement of any
litigation or proceedings against Northern Funds or any of its officers or
directors in connection with the issue and sale of any of the Shares.
2.9 Distributor shall indemnify, defend and hold Northern
Funds, and each of its present or former directors, officers, employees,
representatives, and any person who controls or previously controlled Northern
Funds within the meaning of Section 15 of the 1933 Act, free and harmless from
and against any and all losses, claims, demands, liabilities, damages and
expenses (including the costs of investigating or defending any alleged losses,
claims, demands, liabilities, damages or expenses, and any counsel fees incurred
in connection therewith) which Northern Funds, and each of its present or former
directors, officers, employees, representatives, or any such controlling person,
may incur under the 1933 Act, the 1934 Act, any other statute (including Blue
Sky laws) or any rule or regulation thereunder, or under common law or
otherwise, arising out of or based upon any untrue, or alleged untrue, statement
of a material fact contained in Northern Funds' registration statement or any
prospectus, as from time to time amended or supplemented, or annual or interim
report to shareholders or the omission, or alleged omission, to state therein a
material fact required to be stated therein or necessary to make the statement
not misleading, but only if such statement or omission was made in reliance
upon, and in conformity with, information furnished to Northern Funds or its
counsel by the Distributor for the purpose of, and used in, the preparation
thereof. Distributor's agreement to indemnify Northern Funds and any of the
foregoing indemnitees shall not be deemed to cover any liability to Distributor
to which Northern Funds would otherwise be subject by reason of its willful
misfeasance, bad faith or gross negligence in the performance of its duties, or
by reason of its reckless disregard of its obligations and duties, under this
Agreement. The Distributor's Agreement to indemnify Northern Funds, its present
or former directors, officers, employees, representatives, and any such
controlling person, as aforesaid, is expressly conditioned upon the
Distributor's being notified of any action brought against Northern Funds, its
present or former directors, officers, employees, representatives, or any such
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controlling person, such notification to be given by letter or telegram
addressed to Distributor's President, within a reasonable time after the summons
or other first legal process giving information of the nature of the claim shall
have been served upon Northern Funds or such person, but the failure so to
notify Distributor of any such action shall not relieve Distributor from any
liability which Distributor may have to the person against whom such action is
brought by reason of any such untrue, or alleged untrue, statement or omission,
otherwise than on account of Distributor's indemnity agreement contained in this
paragraph 2.9(a). In case any action shall be brought against Northern Funds,
and each of its present or former directors, officers, employees,
representatives, or controlling persons, in respect of which indemnity may be
sought against the Distributor, the Distributor shall have the rights and duties
given to Northern Funds, and Northern Funds and each person so indemnified shall
have the rights and duties given to the Distributor by the provisions of
paragraph 2.8(b).
2.10 No Shares shall be offered by either Distributor or
Northern Funds under any of the provisions of this Agreement and no orders for
the purchase or sale of such Shares hereunder shall be accepted by Northern
Funds 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 1933 Act, or if and so long as current prospectuses as
required by Section 10 of the 1933 Act, as amended, are not on file with the
Commission; provided, however, that nothing contained in this paragraph 2.10
shall in any way restrict or have an application to or bearing upon Northern
Funds' obligation to repurchase Shares from any shareholder in accordance with
the provisions of the prospectus or Declaration of Trust.
2.11 Northern Funds agrees to advise Distributor promptly in
writing:
(a) of any request by the Commission for amendments to
the registration statement or prospectuses then in
effect;
(b) in the event of the issuance by the Commission of
any stop order suspending the effectiveness of the
registration statement or prospectuses then in
effect or the initiation of any proceeding for that
purpose;
(c) of the happening of any event which makes untrue any
statement of a material fact made in the registration
statement or prospectuses then in effect or which
requires the making of a change in such registration
statement or prospectuses in
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order to make the statements therein not
misleading; and
(d) of all actions of the Commission with respect to any
amendments to any registration statement or
prospectus which may from time to time be filed with
the Commission.
3. Term.
3.1(a) This Agreement shall become effective with respect to
each Fund listed on Schedule A hereof as of the date hereof and, with respect to
each Fund not in existence on that date, on the date an amendment to Schedule A
to this Agreement relating to that Fund is executed. Unless sooner terminated as
provided herein, this Agreement shall continue in effect with respect to each
Fund until March 31, 1997. Thereafter, if not terminated, this Agreement shall
continue automatically in effect as to each Fund for successive annual periods,
provided such continuance is specifically approved at least annually by (i)
Northern Funds' Board of Trustees or (ii) the vote of a majority (as defined in
the 0000 Xxx) of the outstanding voting securities of a Fund, and provided that
in either event the continuance is also approved by a majority of Northern
Funds' Trustees who are not "interested persons" (as defined in the 0000 Xxx) of
any party to this Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval.
3.1(b) This Agreement may be terminated without penalty with
respect to a particular Fund (1) through a failure to renew this Agreement at
the end of a term, (2) upon mutual consent of the parties, or (3) on not less
than sixty (60) days' written notice, by Northern Funds' Trustees, by vote of a
majority (as defined with respect to voting securities in the 1940 Act) of the
outstanding voting securities of the Fund, or by Distributor. The terms of this
Agreement shall not be waived, altered, modified, amended or supplemented in any
manner whatsoever except by a written instrument signed by the Distributor and
Northern Funds. This Agreement will also terminate automatically in the event of
its assignment (as defined in the 1940 Act).
4. Miscellaneous.
4.1 The services of the Distributor rendered to the Funds are
not deemed to be exclusive. The Distributor may render such services and any
other services to others, including other investment companies. Northern Funds
recognizes that from time to time directors, officers, and employees of the
Distributor may serve as directors, trustees, officers and employees of other
corporations or trusts (including other investment companies), that such other
entities may include the name of the Distributor as part of their name and that
the Distributor or its affiliates may enter
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into distribution, administration, fund accounting or other agreements with such
other corporations or trusts.
4.2 Distributor agrees on behalf of itself and its employees
to treat confidentially and as proprietary information of Northern Funds all
records and other information relative to the Funds and prior, present or
potential shareholders of the Funds (and clients of said shareholders), and not
to use such records and information for any purpose other than performance of
Distributor's responsibilities and duties hereunder, except after prior
notification to and approval in writing by Northern Funds, which approval shall
not be unreasonably withheld and may not be withheld where Distributor may be
exposed to civil or criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted authorities, or when
so requested by Northern Funds.
4.3 This Agreement shall be governed by Wisconsin law (except
as to paragraph 4.5 hereof which shall be construed in accordance with the laws
of the State of Massachusetts). To the extent that the applicable laws of the
State of Wisconsin, or any of the provisions herein, conflict with the
applicable provisions of the 1940 Act, the latter shall control, and nothing
herein shall be construed in a manner inconsistent with the 1940 Act or any rule
or order of the Commission thereunder. Any provision of this Agreement which may
be determined by competent authority to be prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
4.4 Any notice required or to be permitted to be given by
either party to the other shall be in writing and shall be deemed to have been
given when hand delivered or sent by registered or certified mail, postage
prepaid, return receipt requested, as follows: Notice to the Distributor shall
be sent to Sunstone Distribution Services, LLC, 000 Xxxx Xxxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxxx, Xxxxxxxxx, 00000, Attention: Xxxxxx X. Xxxxxxx, and notice to
Northern Funds shall be sent to Xxxxx Xxxxxxxx, President, c/o Xxxxxx Xxxxxxx,
00 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx, 00000, with a copy to Xxxxxxx Xxxxx,
Secretary, c/o Drinker Xxxxxx & Xxxxx, 0000 Xxxxxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxxxxxxx, Xxxxxxxxxxxx, 00000.
4.5 This Agreement is executed by or on behalf of Northern
Funds with respect to each of the Funds and the obligations hereunder are not
binding upon any of the Trustees, officers or shareholders of Northern Funds
individually but are binding only upon the Funds to which such obligations
pertain and
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the assets and property of such Funds. Northern Funds' Declaration
of Trust is on file with the Secretary of State of Massachusetts.
4.6 This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original agreement but
such counterparts shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by a duly authorized officer as of the day and year
first above written.
NORTHERN FUNDS
("Northern Funds")
By:________________________________
Xxxxx X. Xxxxxxxx
President
SUNSTONE DISTRIBUTION SERVICES, LLC
("Distributor")
By:________________________________
Xxxxxx X. Xxxxxxx
President
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