DISTRIBUTION AGREEMENT
THIS AGREEMENT is made and entered into as of this 1st day of July, 2002,
by and among The Kenwood Funds, a Delaware business trust (the "Trust"), The
Kenwood Group, Inc., an Illinois corporation (the "Adviser"), and Quasar
Distributors, LLC, a Delaware limited liability company (the "Distributor").
WHEREAS, the Trust 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 interests ("Shares") in separate
series, with each such series representing interests in a separate portfolio of
securities and other assets;
WHEREAS, the Adviser is duly registered under the Investment Advisers Act
of 1940, as amended, as an investment adviser;
WHEREAS, the Trust desires to retain the Distributor as principal
underwriter in connection with the offering and sale of the Shares of each
series listed on Exhibit A hereto (as amended from time to time) (each a "Fund",
collectively the "Funds");
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 of
the National Association of Securities Dealers, Inc. (the "NASD");
WHEREAS, this Agreement has been approved by a vote of the Trust's board of
trustees ("Board") and its disinterested trustees in conformity with Section
15(c) of the 1940 Act; and
WHEREAS, the Distributor is willing to act as principal underwriter for the
Trust on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the promises and mutual covenants
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 Quasar as the Distributor
The Trust hereby appoints the Distributor as its agent for the sale
and distribution of Shares of the Funds, on the terms and conditions set
forth in this Agreement, and the Distributor hereby accepts such
appointment and agrees to perform the services and duties set forth in this
Agreement.
2. Services and Duties of the Distributor
A. The Distributor agrees to sell Shares of the Funds on a best
efforts basis as agent for the Trust during the term of this Agreement,
upon the terms and at the current offering price (plus sales charge, if
any) described in the Prospectus. As used in this Agreement, the term
"Prospectus" shall mean the current prospectus, including the statement of
additional information, as amended or supplemented, relating to the Funds
and included in the currently effective registration statement or
post-effective amendment thereto (the "Registration Statement") of the
Trust under the Securities Act of 1933 (the "1933 Act") and the 0000 Xxx.
B. During the continuous public offering of Shares of the Funds, the
Distributor will hold itself available to receive orders, satisfactory to
the Distributor, for the purchase of Shares of the Funds and will accept
such orders on behalf of the Trust. Such purchase orders shall be deemed
effective at the time and in the manner set forth in the Prospectus.
C. The Distributor, with the operational assistance of the Trust's
transfer agent, shall make Shares available for sale and redemption through
the National Securities Clearing Corporation's Fund/SERV System.
D. In connection with all matters relating to this Agreement, the
Distributor agrees to act in conformity with the Trust's Declaration of
Trust and By-Laws and with the instructions of the Board and to comply with
the requirements of the 1933 Act, the 1934 Act, the 1940 Act, the
regulations of the NASD and all other applicable federal or state laws and
regulations. The Distributor acknowledges and agrees that it is not
authorized to provide any information or make any representations other
than as contained in the Prospectus and any sales literature specifically
approved by the Trust and the Distributor.
E. The Distributor agrees to cooperate with the Trust in the
development of all proposed advertisements and sales literature relating to
the Funds. The Distributor agrees to review all proposed advertisements and
sales literature for compliance with applicable laws and regulations, and
shall file with appropriate regulators those advertisements and sales
literature it believes are in compliance with such laws and regulations.
The Distributor agrees to furnish to the Trust any comments provided by
regulators with respect to such materials and to use its best efforts to
obtain the approval of the regulators to such materials.
F. The Distributor at its sole discretion may repurchase Shares
offered for sale by shareholders of the Funds. Repurchase of Shares by the
Distributor shall be at the price determined in accordance with, and in the
manner set forth in, the current Prospectus. At the end of each business
day, the Distributor shall notify, by any appropriate means agreed upon by
the parties hereto, the Trust and its transfer agent of the orders for
repurchase of Shares received by the Distributor since the last report, the
amount to be paid for such Shares, and the identity of the shareholders
offering Shares for repurchase. The Trust reserves the right to suspend
such repurchase right upon written notice to the Distributor. The
Distributor further agrees to act as agent for the Trust to receive and
transmit promptly to the Trust's transfer agent shareholder requests for
redemption of Shares.
G. The Distributor may, in its discretion, enter into agreements with
such qualified broker-dealers as it may select, in order that such
broker-dealers also may sell Shares of the Funds. The form of any dealer
agreement shall be mutually agreed upon and approved by the Trust and the
Distributor. The Distributor may pay a portion of any applicable sales
charge, or allow a discount, to a selling broker-dealer, as described in
the Prospectus or, if not described, as agreed upon with the broker-dealer.
The Distributor shall include in the forms of agreement with selling
broker-dealers a provision for the forfeiture by them of their sales charge
or discount with respect to Shares sold by them and redeemed, repurchased
or tendered for redemption within seven business days after the date of
confirmation of such purchases.
H. The Distributor shall devote its best efforts to effect sales of
Shares of the Funds but shall not be obligated to sell any certain number
of Shares.
I. The Distributor shall prepare reports for the Board regarding its
activities under this Agreement as from time to time shall be reasonably
requested by the Board, including reports regarding the use of 12b-1
payments received by the Distributor, if any.
J. The services furnished by the Distributor hereunder are not to be
deemed exclusive and the Distributor shall be free to furnish similar
services to others so long as its services under this Agreement are not
impaired thereby. The Trust recognizes that from time to time officers and
employees of the Distributor may serve as directors, trustees, officers and
employees of other entities (including 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 into
distribution, administration, fund accounting, transfer agent or other
agreements with such other entities.
3. Duties and Representations of the Trust
A. The Trust represents that it is duly organized and in good standing
under the law of its jurisdiction of organization and registered as an
open-end management investment company under the 1940 Act. The Trust agrees
that it will act in material conformity with its Declaration of Trust,
By-Laws, its Registration Statement as may be amended from time to time and
resolutions and other instructions of its Board. The Trust agrees to comply
in all material respects with the 1933 Act, the 1940 Act, and all other
applicable federal and state laws and regulations. The Trust represents and
warrants that this Agreement has been duly authorized by all necessary
action by the Trust under the 1940 Act, state law and the Trust's
Declaration of Trust and By-Laws.
B. The Trust, or its agent, shall take or cause to be taken all
necessary action to register Shares of the Funds under the 1933 Act and to
maintain an effective Registration Statement for such Shares in order to
permit the sale of Shares as herein contemplated. The Trust authorizes the
Distributor to use the Prospectus, in the form furnished to the Distributor
from time to time, in connection with the sale of Shares.
C. The Trust represents and agrees that all Shares to be sold by it,
including those offered under this Agreement, are validly authorized and,
when issued in accordance with the description in the Prospectus, will be
fully paid and nonassessable. The Trust further agrees that it shall have
the right to suspend the sale of Shares of any Fund at any time in response
to conditions in the securities markets or otherwise, and to suspend the
redemption of Shares of any Fund at any time permitted by the 1940 Act or
the rules of the Securities and Exchange Commission ("SEC"). The Trust
shall advise the Distributor promptly of any such determination.
D. The Trust agrees to advise the Distributor promptly in writing:
(i) in the event of the issuance by the SEC of any stop-order
suspending the effectiveness of the Registration Statement then in
effect or the initiation of any proceeding for that purpose;
(ii) of the happening of any event which makes untrue any
statement of a material fact made in the Prospectus or which requires
the making of a change in such Prospectus in order to make the
statements therein not misleading; and
E. The Trust shall file such reports and other documents as may be
required under applicable federal and state laws and regulations. The Trust
shall notify the Distributor in writing of the states in which the Shares
may be sold and shall notify the Distributor in writing of any changes to
such information.
F. The Trust agrees to file from time to time such amendments to its
Registration Statement and Prospectus as may be necessary in order that its
Registration Statement and Prospectus will not contain any untrue statement
of material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading.
G. The Trust shall fully cooperate in the efforts of the Distributor
to sell and arrange for the sale of Shares and shall make available to the
Distributor a statement of each computation of net asset value. In
addition, the Trust shall keep the Distributor fully informed of its
affairs and shall provide to the Distributor from time to time copies of
all information, financial statements, and other papers that the
Distributor may reasonably request for use in connection with the
distribution of Shares, including, without limitation, certified copies of
any financial statements prepared for the Trust by its independent public
accountants and such reasonable number of copies of the most current
Prospectus, statement of additional information and annual and interim
reports to shareholders as the Distributor may request. The Trust shall
forward a copy of any SEC filings, including the Registration Statement, to
the Distributor as soon as reasonably practicable. The Trust represents
that it will not use or authorize the use of any advertising or sales
material regarding the Funds unless and until such materials have been
approved and authorized for use by the Distributor.
H. The Trust represents and warrants that its Registration Statement
and any advertisements and sales literature of the Trust (excluding
statements relating to the Distributor and the services it provides that
are based upon written information furnished by the Distributor expressly
for inclusion therein) shall not contain any untrue statement of material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and that all
statements or information furnished to the Distributor pursuant to this
Agreement shall be true and correct in all material respects.
4. Compensation
As compensation for the services performed and the expenses assumed by
Distributor under this Agreement including, but not limited to, any
commissions paid for sales of Shares, Distributor shall be entitled to the
fees and expenses set forth in Exhibit B hereto (as amended from time to
time), which are payable promptly after the last day of each month. Such
fees shall be paid to Distributor by the Adviser.
5. Expenses
A. The Trust shall bear all costs and expenses in connection with
registration of the Shares with the SEC and related compliance with state
securities laws, as well as all costs and expenses in connection with the
offering of the Shares and communications with shareholders of its Funds,
including but not limited to (i) fees and disbursements of its counsel and
independent public accountants; (ii) costs and expenses of the preparation,
filing, printing and mailing of Registration Statements and Prospectuses
and amendments thereto, as well as related advertising and sales
literature, (iii) costs and expenses of the preparation, printing and
mailing of annual and interim reports, proxy materials and other
communications to shareholders of the Funds; and (iv) fees required in
connection with the offer and sale of Shares in such jurisdictions as shall
be selected by the Trust pursuant to Section 3(E) hereof.
B. The Distributor shall bear the expenses of registration or
qualification of the Distributor as a dealer or broker under federal or
state laws and the expenses of continuing such registration or
qualification. The Distributor does not assume responsibility for any
expenses not expressly assumed hereunder.
6. Indemnification
A. The Trust shall indemnify, defend and hold the Distributor, and
each of its present or former members, 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
reasonable counsel fee incurred in connection therewith) which the
Distributor, each of its present and former members, 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 in any annual or interim
report to shareholders, or in any advertisement or sales literature, or
arising out of or 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, or based upon the Trust's failure to
comply with this Agreement or applicable law; provided, however, that the
Trust's obligation to indemnify the 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, annual or interim report, or any such
advertisement or sales literature in reliance upon and in conformity with
information relating to the Distributor and furnished to the Trust or its
counsel by the Distributor in writing and acknowledging the purpose of its
use for the purpose of, and used in, the preparation thereof. The Trust's
agreement to indemnify the Distributor, and any of the foregoing
indemnitees, as the case may be, with respect to any action, is expressly
conditioned upon the Trust being notified of such action brought against
the Distributor, or any of the foregoing indemnitees, 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, unless the failure to give notice does not prejudice the
Trust. Such notification shall be given by letter or by telegram addressed
to the Trust's President, but the failure so to notify the Trust of any
such action shall not relieve the Trust from any liability which the Trust
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 the Trust's indemnity agreement contained in
this Section 6(A).
B. The Trust 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 the Trust elects to assume the defense, such defense shall be conducted
by counsel chosen by the Trust and approved by the Distributor, which
approval shall not be unreasonably withheld. In the event the Trust 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 the Trust 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 the Trust or, if under prevailing law or legal codes of ethics, the same
counsel cannot effectively represent the interests of both the Trust and
the Distributor, and each of its present or former members, officers,
employees, representatives or any controlling person, the Trust will
reimburse the indemnified person or persons named as defendant or
defendants in such suit, for the fees and expenses of any counsel retained
by Distributor and them. The Trust's indemnification agreement contained in
Sections 6(A) and 6(B) 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 members, 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 members, officers, employees or
representatives or to the benefit of any controlling persons and their
successors. The Trust agrees promptly to notify the Distributor of the
commencement of any litigation or proceedings against the Trust or any of
its officers or directors in connection with the issue and sale of any of
the Shares.
C. The Distributor shall indemnify, defend and hold the Trust, and
each of its present or former trustees, officers, employees,
representatives, and any person who controls or previously controlled the
Trust 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 investigation or defending any alleged
losses, claims, demands, liabilities, damages or expenses, and any
reasonable counsel fee incurred in connection therewith) which the Trust,
and each of its present or former trustees, 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 the Trust's Registration Statement or any Prospectus, as from
time to time amended or supplemented, or arising out of or based upon
Distributor's failure to comply with this Agreement or applicable law, 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, written information relating to the
Distributor and furnished to the Trust or its counsel by the Distributor
for the purpose of, and used in, the preparation thereof. The Distributor's
agreement to indemnify the Trust, and any of the foregoing indemnitees, is
expressly conditioned upon the Distributor's being notified of any action
brought against the Trust, and any of the foregoing indemnitees, such
notification to be given by letter or telegram addressed to the
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 the Trust or such person unless the failure to
give notice does not prejudice the Distributor, but the failure so to
notify the Distributor of any such action shall not relieve the Distributor
from any liability which the 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 the
Distributor's indemnity agreement contained in this Section 6(E).
D. The Distributor 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 the Distributor elects to assume the defense, such defense
shall be conducted by counsel chosen by the Distributor and approved by the
Trust, which approval shall not be unreasonably withheld. In the event the
Distributor 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 the
Distributor does not elect to assume the defense of any such suit, or in
case the Trust does not, in the exercise of reasonable judgment, approve of
counsel chosen by the Distributor or, if under prevailing law or legal
codes of ethics, the same counsel cannot effectively represent the
interests of both the Trust and the Distributor, and each of its present or
former members, officers, employees, representatives or any controlling
person, the Distributor will reimburse the indemnified person or persons
named as defendant or defendants in such suit, for the fees and expenses of
any counsel retained by the Trust and them. The Distributor's
indemnification agreement contained in Sections 6(C) and (D) shall remain
operative and in full force and effect regardless of any investigation made
by or on behalf of the Trust, 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 Trust'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. The Distributor agrees promptly to notify the Trust
of the commencement of any litigation or proceedings against the
Distributor or any of its officers or directors in connection with the
issue and sale of any of the Shares.
E. No person shall be obligated to provide indemnification under this
Section 6 if such indemnification would be impermissible under the 1940
Act, the 1933 Act, the 1934 Act or the rules of the NASD; provided,
however, in such event indemnification shall be provided under this Section
6 to the maximum extent so permissible, by law or regulation.
7. Obligations of the Trust
This Agreement is executed by and on behalf of the Trust and the
obligations of the Trust hereunder are not binding upon any of the
trustees, officers or shareholders of the Trust individually but are
binding only upon the Trust and with respect to the Funds to which such
obligations pertain.
8. Governing Law
This Agreement shall be construed in accordance with the laws of the
State of Wisconsin, without regard to conflicts of law principles. 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 SEC thereunder.
9. Duration and Termination
A. This Agreement shall become effective with respect to each Fund
listed on Exhibit 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 Exhibit A
to this Agreement relating to that Fund is executed. Unless sooner
terminated as provided herein, this Agreement shall continue in effect for
two years from the date hereof. Thereafter, if not terminated, this
Agreement shall continue automatically in effect as to each Fund for
successive one-year periods, provided such continuance is specifically
approved at least annually by (i) the Trust's Board or (ii) the vote of a
"majority of the outstanding voting securities" of a Fund, and provided
that in either event the continuance is also approved by a majority of the
Trust's Board who are not "interested persons" of any party to this
Agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval.
B. Notwithstanding the foregoing, this Agreement may be terminated,
without the payment of any penalty, with respect to a particular Fund (i)
through a failure to renew this Agreement at the end of a term, (ii) upon
mutual consent of the parties, or (iii) upon no less than 60 days' written
notice, by either the Trust through a vote of a majority of the members of
the Board who are not "interested persons" of the Trust and have no direct
or indirect financial interest in the operation of this Agreement or by
vote of a "majority of the outstanding voting securities" of a Fund, or by
the 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 the Trust. If required
under the 1940 Act, any such amendment must be approved by the Trust's
Board, including a majority of the Trust's Board who are not "interested
persons" of any party to this Agreement, by vote cast in person at a
meeting for the purpose of voting on such amendment. In the event that such
amendment affects the Adviser, the written instrument shall also be signed
by the Adviser. This Agreement will automatically terminate in the event of
its assignment.
C. Paragraphs 6, 8, and 10 shall survive the termination of this
Agreement.
10. Confidentiality
The Distributor agrees on behalf of its employees to treat all records
relative to the Trust and prior, present or potential shareholders of the
Trust as confidential, and not to use such records for any purpose other
than performance of the Distributor's responsibilities and duties under
this Agreement, except after notification and prior approval by the Trust,
which approval shall not be unreasonably withheld, and may not be withheld
where the Distributor may be exposed to civil or criminal proceedings for
failure to comply, when requested to divulge such information by duly
constituted authorities, when subject to governmental or regulatory audit
or investigation, or when so requested by the Trust. Records and
information which have become known to the public through no wrongful act
of the Distributor or any of its employees, agents or representatives shall
not be subject to this paragraph.
In accordance with Regulation S-P, the Distributor will not disclose
any non-public personal information, as defined in Regulation S-P, received
from the Trust or any Fund regarding any Fund shareholder; provided,
however, that the Distributor may disclose such information to any party as
necessary in the ordinary course of business to carry out the purposes for
which such information was disclosed to the Distributor, or as may be
required by law. The Distributor agrees to use reasonable precautions to
protect and prevent the unintentional disclosure of such non-public
personal information.
11. Anti-Money Laundering Program
The Distributor represents and warrants that it (1) has adopted an
anti-money laundering compliance program ("AML Program") that satisfies the
requirements of all applicable laws and regulations; (2) undertakes to
carry out its AML Program to the best of its ability; and (3) will notify
the Trust and the Adviser promptly if an inspection by the appropriate
regulatory authorities of its AML Program identifies any material
deficiency, and will promptly remedy any material deficiency of which it
learns.
12. Miscellaneous
The captions in this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof
or otherwise affect their construction or effect. 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. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and
their respective successors. As used in this Agreement, the terms "majority
of the outstanding voting securities," "interested person," and
"assignment" shall have the same meaning as such terms have in the 1940
Act.
13. Notices
Any notice required or permitted to be given by any party to the
others shall be in writing and shall be deemed to have been given on the
date delivered personally or by courier service or 3 days after sent by
registered or certified mail, postage prepaid, return receipt requested or
on the date sent and confirmed received by facsimile transmission to the
other parties' respective addresses set forth below:
Notice to the Distributor shall be sent to:
Quasar Distributors, LLC
Attn: President
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
notice to the Trust shall be sent to:
The Kenwood Funds
00 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
and notice to the Adviser shall be sent to:
The Kenwood Group, Inc.
00 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by a duly authorized officer on one or more counterparts as of the date
first above written.
THE KENWOOD FUNDS QUASAR DISTRIBUTORS, LLC
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxxxxxx
--------------------- -------------------------------
Xxxxxxx X. Xxxxxx Xxxxx X. Xxxxxxxxx, President
Title: President
------------------
THE KENWOOD GROUP, INC.
By:/s/ Xxxxxxx X. Xxxxxx
---------------------
Xxxxxxx X. Xxxxxx
Title: President
-----------------
Exhibit A
to the
Distribution Agreement
Fund Names
Separate Series of The Kenwood Funds
Name of Series Date Added
The Kenwood Growth & Income Fund July 1, 2002
Exhibit B
to the
Distribution Agreement
Quasar Distributors, LLC: Fees
Basic Distribution Services
o Base annual fee: $10,000
Advertising Compliance Review/NASD Filings
o $150 per job for the first 10 pages (minutes if tape or video); $20 per
page (minutes if tape or video) thereafter.
Non-NASD filed materials, e.g. Internal Use Only materials:
o $100 per job for the first 10 pages (minutes if tape or video); $20 per
page (minutes if tape or video) thereafter.
NASDR Expedited Service for 3 day turnaround:
o $1000 for the first 10 pages (minutes if audio or video) $25 per page
(minutes if audio or video) thereafter. (Comments are faxed. NASDR may not
accept expedited request.)
Licensing of Investment Advisor's Staff (if desired)
o $900 annual fee per registered representative ("RR"), for 3 RRs or less.
$2,000 annual fee per RR, for 4 or more RRs.
Quasar is limited to these licenses for sponsorship: 6 7 24 26 27 63 66
63/65
o All associated NASD and State fees for RRs, including license and renewal
fees, according to the Quasar RR fee schedule.
Out-of-Pocket Expenses
Reasonable out-of-pocket expenses incurred by the Distributor in connection with
activities primarily intended to result in the sale of Shares, including,
without limitation:
o typesetting, printing and distribution of Prospectuses and shareholder
reports
o production, printing, distribution and placement of advertising and sales
literature and materials
o engagement of designers, free-xxxxx writers and public relations firms
o long-distance telephone lines, services and charges
o postage
o overnight delivery charges
o travel, lodging and meals
