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Exhibit (15)(b)(i)
SHAREHOLDER SERVICES
AND FINANCING AGREEMENT
AGREEMENT made as of this 1st day of February, 1994, by and between The
Winsbury Company Limited Partnership d/b/a The Winsbury Company (the
"Distributor"), having its principal place of business at 0000 Xxxx
Xxxxxx-Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxx, and Security Distributors, Inc.
("SDI"), having its principal place of business at 000 Xxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxx 00000, relating to financing assistance and shareholder support services
in connection with the sale of certain units of beneficial interest ("Investor
B Shares") of The Parkstone Group of Funds (the "Trust").
WHEREAS, the Trust is an open-end management investment company, organized as
a Massachusetts business trust and registered with the Securities and Exchange
Commission (the "SEC") under the Investment Company Act of 1940 (the "1940
Act");
WHEREAS, the Trust offers three separate classes of shares, including
Investor B Shares for each of the non-money market investment portfolios of the
Trust (individually, a "Fund"; collectively the "Funds") that are identified in
Schedule A hereto;
WHEREAS, the Investor B Shareholders of each Fund have adopted a Distribution
Plan (the "Investor B Plan") pursuant to Rule 12b-1 under the 1940 Act;
WHEREAS, the Investor B Plan authorizes the Distributor to enter into
agreements with third parties to implement such Plan;
WHEREAS, it is intended that SDI (a) arrange for an affiliate, Security
Benefit Group, Inc. (the "Affiliate"), to provide financing assistance in the
form of commission payments made to participating organizations (as defined
below) who sell Investor B Shares and (b) provide shareholder support services
to certain Investor B Shareholders, each in accordance with the Investor B
Plan; and
WHEREAS, it is intended that SDI or the Affiliate be compensated for such
financing assistance, as more fully described below.
NOW, THEREFORE, intending to be legally bound, the Distributor and SDI hereby
agree as follows:
1. REFERENCE TO PROSPECTUS; DETERMINATION OF NET ASSET VALUE.
1.1 Reference is made to the prospectus for Investor B Shares of each Fund
(individually, a "Prospectus"; collectively, the "Prospectuses") as from
time to time are effective under the Securities Act of 1933 (the "1933
Act"). Terms defined therein and not otherwise defined herein are used
herein with the meaning so defined.
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1.2 For purposes of determining the fees payable to SDI under Section 4, the
average daily net asset value of a Fund's Investor B Shares will be
computed in the manner specified in the Trust's registration statement (as
the same is in effect from time to time) in connection with the
computation of the net asset value of such Fund's Investor B Shares for
purposes of purchases and redemptions.
2. PROVISION OF FINANCING ASSISTANCE.
Under the terms of each Prospectus for Investor B Shares, the public
offering price of such Shares is equal to the net asset value per Share,
subject to a contingent deferred sales charge ("CDSC") that is more fully
described therein. The Distributor will receive CDSC payments from
Investor B Shareholders when such Shareholders redeem their Shares under
certain circumstances described in the Prospectuses. The Distributor shall
be responsible for the proper calculation of all CDSC payments due from
Investor B Shareholders and shall maintain such records as are necessary to
document the proper calculation of such payments. The Distributor shall
make such records available to SDI for inspection upon not more than five
business days notice. The purpose of a CDSC is to provide compensation to
participating organizations (i.e., (a) broker-dealers that are registered
pursuant to the Securities Exchange Act of 1934, as amended (the "1934
Act"), and that are members of the National Association of Securities
Dealers, Inc. (the "NASD") and (b) banks as defined in Section 3(a)(6) of
the 1934 Act that are not required to register as broker-dealers pursuant
to the 0000 Xxx) ("Participating Organizations") for the sale of Investor B
Shares. In order to compensate Participating Organizations for such sales
at the time those sales take place, SDI agrees to arrange for payments to
be made by the Affiliate to those Participating Organizations that may,
from time to time, enter into agreements with the Distributor for the
distribution of Investor B Shares. The terms and conditions of such
payments shall be set forth in separate agreements between SDI, the
Affiliate, the Distributor and those Participating Organizations (the
"Service and Commission Agreements"), which terms and conditions shall
include representations and warranties by such Participating Organizations
as to the legal authority for their entry into and performance of
obligations under the Service and Commission Agreements.
3. PROVISION OF SHAREHOLDER SUPPORT SERVICES.
3.1 SDI is hereby authorized and agrees to provide assistance to Investor B
Shareholders that are customers of First of America Bank Corporation or
its affiliates or customers of other organizations ("Customers"). Such
assistance shall be in the form of responding to inquiries from such
Customers regarding their fund accounts.
3.2 Upon receiving written consent of the Distributor, SDI may, at its
expense, subcontract with any entity or person concerning the provision of
the services contemplated under paragraph 3.1; provided, however, that (a)
SDI shall not be relieved of any of its obligations under this Agreement
by the appointment of such subcontractor, (b) SDI shall
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be responsible, to the extent provided in paragraph 6.1 hereof, for all
acts of such subcontractor as if such acts were its own and (c) the
Distributor acknowledges that such subcontractors may not be under the
direct supervision and control of SDI and SDI may obtain indemnification
making such subcontractor responsible for SDI's obligations under this
Agreement.
3.3 SDI will provide or, subject to paragraph 3.2, will arrange for a
subcontractor to provide, such office space and equipment, telephone
facilities, and personnel as may be reasonably necessary or beneficial in
order to provide such services to Customers.
4. FINANCING ASSISTANCE FEE AND SHAREHOLDER SERVICES FEE; PAYMENT OF
CONTINGENT DEFERRED SALES CHARGE AMOUNTS.
4.1 In consideration of the financing assistance provided by SDI hereunder,
the Distributor will pay to the Affiliate, and SDI will accept as full
payment therefor, subject to the provisions of paragraphs 4.3 and 7.2, (a)
a fee calculated at the applicable annual rate set forth in Schedule B
hereto with respect to the average daily net asset value of each Fund's
Investor B Shares, which fee will be computed daily and paid monthly and
(b) all CDSCs that are received by the Distributor from Investor B
Shareholders in accordance with the schedule and all other applicable
provisions contained in the then-current prospectuses for each Fund's
Investor B Shares.
4.2 In consideration of the shareholder support services provided by SDI
hereunder, the Distributor will pay to SDI, and SDI will accept as full
payment therefor, a fee calculated at the applicable annual rate set forth
in Schedule C hereto with respect to the average daily net asset value of
each Fund's Investor B Shares which are held of record by First of America
Bank Corporation from time to time on behalf of Customers, which fee will
be computed daily and paid monthly.
4.3 With respect to the fee rates set forth in Schedules B and C hereto and
the CDSC described herein, it is understood that such rates and charges
may be prospectively increased or decreased by the Trust at any time upon
notice to SDI. It is hereby agreed that, in the event of such an increase
or decrease, the commission amounts payable to broker-dealers described in
Section 2 above shall be adjusted upward or downward as is reasonably
necessary upon mutual agreement of the parties hereto. In the event that
the parties hereto fail to mutually agree upon an acceptable adjustment of
the commission amounts described in Section 2 above, either of the parties
hereto may terminate this Agreement in accordance with paragraph 7.2
below.
4.4 The fees that are otherwise payable pursuant to paragraphs 4.1 and 4.2
above shall be subject to the limitations on the payment of asset- based
sales charges that are set forth in Article III, Section 26 of the Rules
of Fair Practice promulgated by the NASD.
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5. REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
5.1 The Distributor represents and warrants that it is the duly authorized and
appointed distributor of the Investor B Shares of each Fund, and that it
is authorized to enter into this Agreement pursuant to the Investor B
Plan.
5.2 In the event it subcontracts, pursuant to paragraph 3.2, its rights and
responsibilities to provide shareholder support services hereunder,
subject to the prior written consent of the Distributor, SDI represents,
warrants and agrees that it will use its best efforts to determine that
the subcontractor possesses the legal authority to perform such services
without violation of any applicable laws and regulations (including
Federal banking laws, if applicable). If requested by SDI to assist in
the determination that a subcontractor possesses such legal authority, the
Distributor will use its best efforts to provide such assistance.
6. EXCULPATION; INDEMNIFICATION.
6.1 The Distributor shall not be liable to SDI and SDI shall not be liable to
the Distributor except for acts or failures to act which constitute a lack
of good faith or gross negligence and for obligations expressly assumed by
either party hereunder. Nothing contained in this Agreement is intended
to operate as a waiver by the Distributor or by SDI of compliance with any
applicable federal or state law, rule, or regulation or the rules and
regulations promulgated by the NASD.
6.2 Each party (the "Indemnifying Party") hereto shall indemnify the other
party to this Agreement (the "Indemnified Party") and hold the Indemnified
Party harmless from any claims or assertions relating to the lawfulness of
the Indemnifying Party's participation in this Agreement and the
transactions contemplated hereby or relating to any activities of any
persons or entities affiliated with the Indemnifying Party performed in
connection with the discharge of its responsibilities under this
Agreement. If any such claims are asserted, the Indemnified Party shall
have the right to manage its own defense, including the selection and
engagement of legal counsel of its choosing, and all costs of such defense
shall be borne by the Indemnifying Party.
7. EFFECTIVE DATE; TERMINATION.
7.1 This Agreement will become effective with respect to each Fund on the date
a fully executed copy of this Agreement is received by the Distributor or
its designee. Unless sooner terminated with respect to any Fund, this
Agreement will continue with respect to a Fund until December 31, 1995,
and thereafter will continue automatically for successive annual periods
ending on December 31 of each year, provided such continuance is
specifically approved at least annually by the vote of a majority of the
members of the Board of Trustees of the Trust who are not "interested
persons" (as such term is defined in the 0000 Xxx) and who have no direct
or indirect financial interest in
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the Plan relating to such Fund or any agreement relating to such Plan,
including this Agreement, cast in person at a meeting called for the
purpose of voting on such approval.
7.2 This Agreement will automatically terminate with respect to a Fund in the
event of its assignment (as such term is defined in the 0000 Xxx) with
respect to such Fund. This Agreement may be terminated with respect to
any Fund by the Distributor or by SDI, without penalty, upon sixty days'
prior written notice to the other party. This Agreement may also be
terminated with respect to any Fund at any time without penalty by the
vote of a majority of the members of the Board of Trustees of the Trust
who are not "interested persons" (as such term is defined in the 0000 Xxx)
and who have no direct or indirect financial interest in the Plan relating
to such Fund or any agreement relating to such Plan, including this
Agreement, or by a vote of a majority of the Shares of such Fund on sixty
days' written notice.
8. GENERAL.
8.1 All notices and other communications to either SDI or the Distributor will
be duly given if mailed, telegraphed or telecopied to the appropriate
address set forth on page 1 hereof, or at such other address as either
party may provide in writing to the other party.
8.2 The Distributor may enter into other similar agreements for the provision
of Shareholder services with any other person or persons without SDI's
consent.
8.3 This Agreement supersedes any other agreement between the Distributor and
SDI relating to the provision of financing assistance and shareholder
support services. All covenants, agreements, representations, and
warranties made herein shall be deemed to have been material and relied on
by each party, notwithstanding any investigation made by either party or
on behalf of either party, and shall survive the execution and delivery of
this Agreement. The invalidity or unenforceability of any term or
provision hereof shall not affect the validity or enforceability of any
other term or provision hereof. The headings in this Agreement are for
convenience of references only and shall not alter or otherwise affect the
meaning hereof This Agreement may be executed in any number of
counterparts which together shall constitute one instrument and shall be
governed by and construed in accordance with the laws (other than the
confLict of laws rules) of the State of Ohio and shall bind and inure to
the benefit of the parties hereto and their respective successors and
assigns.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first
written above.
THE WINSBURY COMPANY LIMITED
PARTNERSHIP
By: The Winsbury Corporation,
General Partner
By: /s/ Xxxxxxx X. Xxxxxxxx
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Title: Senior Vice President
SECURITY DISTRIBUTORS, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Title: Treasurer
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SCHEDULE A
TO THE
SHAREHOLDER SERVICES AND FINANCING AGREEMENT
BETWEEN THE WINSBURY COMPANY LIMITED PARTNERSHIP
AND SECURITY DISTRIBUTORS, INC.
NAME OF THE FUND
Parkstone Bond Fund
Parkstone Limited Maturity Fund
Parkstone Intermediate Government Obligations Fund
Parkstone Municipal Bond Fund
Parkstone U.S. Government Income Fund
Parkstone Michigan Municipal Bond Fund
Parkstone Equity Fund
Parkstone Small Capitalization Fund
Parkstone High Income Equity Fund
Parkstone International Discovery Fund
Parkstone Balanced Fund
THE WINSBURY COMPANY
LIMITED PARTNERSHIP
By: The Winsbury Corporation, SECURITY DISTRIBUTORS, INC.
General Partner
By: /s/ Xxxxxxx X. Xxxxxxxx By: /s/ Xxxxx X. Xxxxxxx
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Title: Senior Vice President Title: Treasurer
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Date: March 4, 1994 Date: 5/20/94
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X-0
0
XXXXXXXX X
TO THE
SHAREHOLDER SERVICES AND FINANCING AGREEMENT
BETWEEN THE WINSBURY COMPANY LIMITED PARTNERSHIP
AND SECURITY DISTRIBUTORS, INC.
Compensation for Financing Assistance*__
Annual rate of up to 75 one-hundredths of one percent (.75%) of the
average daily net assets of the Investor B Shares of each Fund that is
identified in Schedule A.
THE WINSBURY COMPANY
LIMITED PARTNERSHIP
By: The Winsbury Corporation, SECURITY DISTRIBUTORS, INC.
General Partner
By: /s/ Xxxxxxx X. Xxxxxxxx By: /s/ Xxxxx X. Xxxxxxx
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Title: Senior Vice President Title: Treasurer
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Date: March 4, 1994 Date: 5/20/94
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____________
*All fees are computed daily and paid monthly.
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SCHEDULE C
TO THE
SHAREHOLDER SERVICES AND FINANCING AGREEMENT
BETWEEN THE WINSBURY COMPANY LIMITED PARTNERSHIP
AND SECURITY DISTRIBUTORS, INC.
Compensation for Shareholder Support Services
Annual rate of up to 25 one-hundredths of one percent (.25%) of the
average daily net assets of the Investor B Shares of each Fund identified
in Schedule A that are held of record by First of America Bank Corporation
from time to time on behalf of Customers.
THE WINSBURY COMPANY
LIMITED PARTNERSHIP
By: The Winsbury Corporation, SECURITY DISTRIBUTORS, INC.
General Partner
By: /s/ Xxxxxxx X. Xxxxxxxx By: /s/ Xxxxx X. Xxxxxxx
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Title: Senior Vice President Title: Treasurer
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Date: March 4, 1994 Date: 5/20/94
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