DISTRIBUTION AGREEMENT
Agreement made as of the 20th day of March, 1995, by and between IDS Progressive
Fund, Inc. (the "Fund"), a Minnesota corporation, for and on behalf of each
class of the Fund and American Express Financial Advisors Inc., a Delaware
corporation.
Part One: DISTRIBUTION OF SECURITIES
(1) The Fund covenants and agrees that, during the term of this agreement and
any renewal or extension, American Express Financial Advisors shall have the
exclusive right to act as principal underwriter for the Fund and to offer for
sale and to distribute either directly or through any affiliate any and all
shares of each class of capital stock issued or to be issued by the Fund.
(2) American Express Financial Advisors hereby covenants and agrees to act as
the principal underwriter of each class of capital shares issued and to be
issued by the Fund during the period of this agreement and agrees during such
period to offer for sale such shares as long as such shares remain available for
sale, unless American Express Financial Advisors is unable or unwilling to make
such offer for sale or sales or solicitations therefor legally because of any
federal, state, provincial or governmental law, rule or agency or for any
financial reason.
(3) With respect to the offering for sale and sale of shares of each class to be
issued by the Fund, it is mutually understood and agreed that such shares are to
be sold on the following terms:
(a) All sales shall be made by means of an application, and every
application shall be subject to acceptance or rejection by the Fund at its
principal place of business. Shares are to be sold for cash, payable at the time
the application and payment for such shares are received at the principal place
of business of the Fund.
(b) No shares shall be sold at less than the asset value (computed in
the manner provided by the currently effective prospectus or Statement of
Additional Information and the Investment Company Act of 1940, and rules
thereunder). The number of shares or fractional shares to be acquired by each
applicant shall be determined by dividing the amount of each accepted
application by the public offering price of one share of the capital stock of
the appropriate class as of the close of business on the day when the
application, together with payment, is received by the Fund at its principal
place of business. The computation as to the number of shares and fractional
shares shall be carried to three decimal points of one share with the
computation being carried to the nearest 1/lOOOth of a share. If the day of
receipt of the application and payment is not a full business day, then the
asset value of the share for use in such computation shall be determined as of
the close of business on the next succeeding full business day. In the event of
a period of emergency, the computation of the asset value for the purpose of
determining the number of shares or fractional shares to be acquired by the
applicant may be deferred until the close of business on the first full business
day following the termination of the period of emergency. A period of emergency
shall have the definition given thereto in the Investment Company Act of 1940,
and rules thereunder.
(4) The Fund agrees to make prompt and reasonable effort to do any and all
things necessary, in the opinion of American Express Financial Advisors, to have
and to keep the Fund and the shares properly registered or qualified in all
appropriate jurisdictions and, as to shares, in such amounts as American Express
Financial Advisors may from time to time designate in order that the Fund's
shares may be offered or sold in such jurisdictions.
(5) The Fund agrees that it will furnish American Express Financial Advisors
with information with respect to the affairs and accounts of the Fund, and in
such form, as American Express Financial Advisors may from time to time
reasonably require and further agrees that American Express Financial Advisors,
at all reasonable times, shall be permitted to inspect the books and records of
the Fund.
(6) American Express Financial Advisors or its agents may prepare or cause to be
prepared from time to time circulars, sales literature, broadcast material,
publicity data and other advertising material to be used in the sales of shares
issued by the Fund, including material which may be deemed to be a prospectus
under rules promulgated by the Securities and Exchange Commission (each separate
promotional piece is referred to as an "Item of Soliciting Material"). At its
option, American Express Financial Advisors may submit any Item of Soliciting
Material to the Fund for its prior approval. Unless a particular Item of
Soliciting Material is approved in writing by the Fund prior to its use,
American Express Financial Advisors agrees to indemnify the Fund and its
directors and officers against any and all claims, demands, liabilities and
expenses which the Fund or such persons may incur arising out of or based upon
the use of any Item of Soliciting Material. The term "expenses" includes amounts
paid in satisfaction of judgments or in settlements. The foregoing right of
indemnification shall be in addition to any other rights to which the Fund or
any director or officer may be entitled as a matter of law. Notwithstanding the
foregoing, such indemnification shall not be deemed to abrogate or diminish in
any way any right or claim American Express Financial Advisors may have against
the Fund or its officers or directors in connection with the Fund's registration
statement, prospectus, Statement of Additional Information or other information
furnished by or caused to be furnished by the Fund.
(7) American Express Financial Advisors agrees to submit to the Fund each
application for shares immediately after the receipt of such application and
payment therefor by American Express Financial Advisors at its principal place
or business.
(8) American Express Financial Advisors agrees to cause to be delivered to each
person submitting an application a prospectus or circular to be furnished by the
Fund in the form required by the applicable federal laws or by the acts or
statutes of any applicable state, province or country.
(9) The Fund shall have the right to extend to shareholders of each class the
right to use the proceeds of any cash dividend paid by the Fund to that
shareholder to purchase shares of the same class at the net asset value at the
close of business upon the day of purchase, to the extent set forth in the
currently effective prospectus or Statement of Additional Information.
(10) Shares of each class issued by the Fund may be offered and sold at their
asset value to the shareholders of the same class of other funds in the IDS
MUTUAL FUND GROUP who wish to exchange their investments in shares of the other
funds in the IDS MUTUAL FUND GROUP to investments in shares of the Fund, to the
extent set forth in the currently effective prospectus or Statement of
Additional Information, such asset value to be computed as of the close of
business on the day of sale of such shares of the Fund.
(11) American Express Financial Advisors and the Fund agree to use their best
efforts to conform with all applicable state and federal laws and regulations
relating to any rights or obligations under the term of this agreement.
Part Two: ALLOCATION OF EXPENSES
Except as provided by any other agreements between the parties, American Express
Financial Advisors covenants and agrees that during the period of this agreement
it will pay or cause or be paid all expenses incurred by American Express
Financial Advisors, or any of its affiliates, in the offering for sale or sale
of each class of the Fund's shares.
Part Three: COMPENSATION
(1) It is covenanted and agreed that American Express Financial Advisors shall
be paid:
(i) for a class of shares imposing a front-end sales charge, by the
purchasers of Fund shares in an amount equal to the difference between the total
amount received upon each sale of shares issued by the Fund and the asset value
of such shares at the time of such sale; and
(ii) for a class of shares imposing a deferred sales charge, by owners
of Fund shares at the time the sales charge is imposed in an amount equal to any
deferred sales charge, as described in the Fund's prospectus.
Such sums as are received by the Fund shall be received as Agent for American
Express Financial Advisors and shall be remitted to American Express Financial
Advisors daily as soon as practicable after receipt.
(2) The asset value of any share of each class of the Fund shall be determined
in the manner provided by the classes currently effective prospectus and
Statement of Additional Information and the Investment Company Act of 1940, and
rules thereunder.
Part Four: MISCELLANEOUS
(1) American Express Financial Advisors shall be deemed to be an independent
contractor and, except as expressly provided or authorized in this agreement,
shall have no authority to act for or represent the Fund.
(2) American Express Financial Advisors shall be free to render to others
services similar to those rendered under this agreement.
(3) Neither this agreement nor any transaction had pursuant hereto shall be
invalidated or in any way affected by the fact that directors, officers, agents
and/or shareholders of the Fund are or may be interested in American Express
Financial Advisors as directors, officers, shareholders or otherwise; that
directors, officers, shareholders or agents of American Express Financial
Advisors are or may be interested in the Fund as directors, officers,
shareholders or otherwise; or that American Express Financial Advisors is or may
be interested in the Fund as shareholder or otherwise, provided, however, that
neither American Express Financial Advisors nor any officer or director of
American Express Financial Advisors or any officers or directors of the Fund
shall sell to or buy from the Fund any property or security other than a
security issued by the Fund, except in accordance with a rule, regulation or
order of the federal Securities and Exchange Commission.
(4) For the purposes of this agreement, a "business day" shall have the same
meaning as is given to the term in the By-laws of the Fund.
(5) Any notice under this agreement shall be given in writing, addressed and
delivered, or mailed postpaid, to the parties to this agreement at each
company's principal place of business in Minneapolis, Minnesota, or to such
other address as either party may designate in writing mailed to the other.
(6) American Express Financial Advisors agrees that no officer, director or
employee of American Express Financial Advisors will deal for or on behalf of
the Fund with himself as principal or agent, or with any corporation or
partnership in which he may have a financial interest, except that this shall
not prohibit:
(a) Officers, directors and employees of American Express Financial
Advisors from having a financial interest in the Fund or in American Express
Financial Advisors.
(b) The purchase of securities for the Fund, or the sale of securities
owned by the Fund, through a security broker or dealer, one or more of whose
partners, officers, directors or employees is an officer, director or employee
of American Express Financial Advisors, provided such transactions are handled
in the capacity of broker only and provided commissions charged do not exceed
customary brokerage charges for such services.
(c) Transactions with the Fund by a broker-dealer affiliate of American
Express Financial Advisors if allowed by rule or order of the Securities and
Exchange Commission and if made pursuant to procedures adopted by the Fund's
Board of Directors.
(7) American Express Financial Advisors agrees that, except as otherwise
provided in this agreement, or as may be permitted consistent with the use of a
broker-dealer affiliate of American Express Financial Advisors under applicable
provisions of the federal securities laws, neither it nor any of its officers,
directors or employees shall at any time during the period of this agreement
make, accept or receive, directly or indirectly, any fees, profits or emoluments
of any character in connection with the purchase or sale of securities (except
securities issued by the Fund) or other assets by or for the Fund.
Part Five: TERMINATION
(1) This agreement shall from year to year unless and until terminated by
American Express Financial Advisors or the Fund, except that such continuance
shall be specifically approved at least annually by a vote of a majority of the
Board of Directors who are not parties to this agreement or interested persons
of any such party, cast in person at a meeting called for the purpose of voting
on such approval, and by a majority of the Board of Directors or by vote of a
majority of the outstanding voting securities of the Fund. As used in this
paragraph, the term "interested person" shall have the meaning as set forth in
the Investment Company Act of 1940, as amended.
(2) This agreement may be terminated by American Express Financial Advisors or
the Fund at any time by giving the other party sixty (60) days written notice of
such intention to terminate.
(3) This agreement shall terminate in the event of its assignment, the term
"assignment" for this purpose having the same meaning as set forth in the
Investment Company Act of 1940, as amended.
IN WITNESS WHEREOF, The parties hereto have executed the foregoing agreement on
the date and year first above written.
IDS PROGRESSIVE FUND, INC.
By /s/ Xxxxxx X. Xxx
Xxxxxx X. Xxx
Vice President
AMERICAN EXPRESS FINANCIAL ADVISORS INC.
By /s/ Xxxxx X. Xxxxxx
Vice President
