Exhibit (6)
NORWEST ADVANTAGE FUNDS
DISTRIBUTION SERVICES AGREEMENT
October 1, 1995, as amended July 28, 1998
AGREEMENT made the 1st day of October, 1995 as amended July 28, 1998
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.
(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 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, 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).
(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.
(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.
(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.
(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.
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)
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,
(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).
(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.
(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
Vice Chairman
FORUM FINANCIAL SERVICES, INC.
By:________________________
Xxxxx X. Xxxxxxxxx
Secretary
NORWEST ADVANTAGE FUNDS
DISTRIBUTION SERVICES AGREEMENT
Appendix A
Funds and Classes of the Trust
as of July 28, 1998
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
NORWEST ADVANTAGE FUNDS
DISTRIBUTION SERVICES AGREEMENT
Appendix B
July 28, 1998
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.
"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:
(1) Commission Shares: (a) Commission Shares of each class of Shares of
each Fund outstanding from time to time attributed to Forum or such Other
Distributor shall be those Commission Shares of such class of such Fund which
were sold while Forum or such Other Distributor was the exclusive Distributor
for such Shares, determined in accordance with the transfer records for such
Fund.
(b) The Commission Shares of each class of Shares of each Fund
outstanding from time to time attributed to Forum or such Other Distributor
shall be the Date of Original Issuance of which occurs during the period in
which Forum or such Other Distributor was the exclusive distributor for such
Fund in respect of such class of Shares of such Fund.
(c) 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 rules
(a) and (b) above.
(d) 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 come out of the 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.
(2) Free Shares.
(a) Free Shares outstanding on the date of termination of Forum's
services will be attributed to Forum or such Other Distributor in the same
proportion that Commission Shares were attributed to each on such date.
(b) 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 which will be attributed to Forum and such Other Distributor based
upon the percentage of total Free Shares of such Fund which were outstanding at
the commencement of such period which was attributed to each at the commencement
of such period under these rules.
(c) 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 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.
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.
