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Exhibit 1
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MAGNA FUNDS
Distribution and Service Plan (Investor Class)
This Plan (the "Plan") dated as of ______________, 2000, constitutes
the Distribution and Service Plan with respect to the Investor Shares of each
series of Magna Funds, a Massachusetts business trust (the "Trust").
Section 1. The Trust will pay to the principal distributor of the
Trust's shares (the "Distributor") a fee (the "Distribution and Service Fee")
for services rendered and expenses borne by the Distributor in connection with
the distribution of Investor Shares of the Trust and/or in connection with
personal service rendered to Investor Share shareholders of the Trust and/or
maintenance of Investor Share shareholder accounts, at an annual rate with
respect to each fund (series) of the Trust (a "Fund") not to exceed 0.50% of the
Fund's average daily net assets attributable to its Investor Shares. Subject to
such limit and subject to the provisions of Section 8 hereof, the Distribution
and Service Fee shall be as approved from time to time by (a) the Trustees of
the Trust and (b) the Independent Trustees of the Trust and may be paid in
respect of services rendered and expenses borne in the past as to which no
Distribution and Service Fee was paid on account of such limitation. If at any
time this Plan shall not be in effect with respect to all Funds of the Trust,
the Distribution and Service Fee shall be computed on the basis of net assets
attributable to Investor Shares of those Funds for which the Plan is in effect.
The Distribution and Service Fee shall be accrued daily and paid monthly or at
such other intervals as the Trustees shall determine.
Section 2. The Distribution and Service Fee may be spent by the
Distributor on the distribution of Investor Shares of the Trust and/or on
personal services rendered to Investor Share shareholders of the Trust and/or
maintenance of Investor Share shareholder accounts (but will generally not be
spent on record keeping charges, accounting expenses, transfer costs, or
custodian fees). The Distributor's expenditures may include, but shall not be
limited to, compensation to, and expenses (including telephone and overhead
expenses) of, financial consultants or other employees of the Distributor or of
participating or introducing brokers, certain banks and other financial
intermediaries who aid in the processing of purchase or redemption requests for
Investor Shares or the processing of dividend payments with respect to Investor
Shares, who provide information periodically to Investor Share shareholders
showing their positions in a Fund's Investor Shares, who issue confirmations for
transactions by Investor Share shareholders, who forward communications from the
Trust to Investor Share shareholders, who render ongoing advice concerning the
suitability of particular investment opportunities offered by the Trust in light
of Investor Share shareholders' needs, who provide and maintain elective
Investor Share shareholder services such as
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check writing and wire transfer services, who provide and maintain
pre-authorized investment plans for Investor Share shareholders, who act as sole
shareholder of record and nominee for Investor Share shareholders, who respond
to inquiries from Investor Share shareholders relating to such services, who
train personnel in the provision of such services or who provide such similar
services as permitted under applicable statutes, rules or regulations.
Section 3. This Plan shall not take effect until it has been approved,
together with any related agreements, by votes of the majority (or whatever
greater percentage may, from time to time, be required by Section 12(b) of the
Investment Company Act of 1940 (the "Act") or the rules and regulations
thereunder) of both (a) the Trustees of the Trust, and (b) the Independent
Trustees of the Trust cast in person at a meeting called for the purpose of
voting on this Plan or such agreement.
Section 4. This Plan shall continue in effect for a period of more than
one year after it takes effect only so long as such continuance is specifically
approved at least annually in the manner provided for approval of this Plan in
Section 3. It is acknowledged that the Distributor may expend or impute interest
expense in respect of its activities or expenses under this Plan and the
Trustees and the Independent Trustees may give such weight to such interest
expense as they determine in their discretion.
Section 5. Any person authorized to direct the disposition of monies
paid or payable by the Trust pursuant to this Plan or any related agreement
shall provide to the Trustees of the Trust, and the Trustees shall review, at
least quarterly, a written report of the amounts so expended and the purposes
for which such expenditures were made.
Section 6. This Plan may be terminated at any time with respect to the
Investor Shares of any Fund by vote of a majority of the Independent Trustees,
or by vote of a majority of the outstanding Investor Share voting securities of
that Fund.
Section 7. All agreements with any person relating to implementation of
this Plan with respect to any Fund shall be in writing, and any agreement
related to this Plan with respect to any Fund shall provide:
A. That such agreement may be terminated at any time, without
payment of any penalty, by vote of a majority of the
Independent Trustees or by vote of majority of the outstanding
Investor Share voting securities of such Fund, on not more
than 60 days' written notice to any other party to the
agreement; and
B. That such agreement shall terminate automatically in the event
of its assignment.
Section 8. This Plan may not be amended to increase materially the
amount of Distribution and Service Fees permitted pursuant to Section 1 hereof
without approval in
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the manner provided in Section 3 hereof, and all material amendments to this
Plan shall be approved in the manner provided for approval of this Plan in
Section 3 hereof.
Section 9. As used in this Plan, (a) the term "Independent Trustees"
shall mean those Trustees of the Trust who are not interested persons of the
Trust, and have no direct or indirect financial interest in the operation of
this Plan or any agreements related to it, (b) the terms "assignment",
"interested person" and "majority of the outstanding voting securities" shall
have the respective meanings specified in the Act and the rules and regulations
thereunder, subject to such exemptions as may be granted by the Securities and
Exchange Commission, (c) the term "introducing broker" shall mean any broker or
dealer who is a member of the National Association of Securities Dealers, Inc.
and who is acting as an introducing broker pursuant to clearing agreements with
the Distributor; and (d) the term "participating broker" shall mean any broker
or dealer who is a member of the National Association of Securities Dealers,
Inc. and who has entered into a selling or dealer agreement with the
Distributor.
Section 10. This Plan has been adopted pursuant to Rule 12b-1 under the
Act and is designed to comply with all applicable requirements imposed under
such Rule. To the extent that any or all of the Distribution and Service Fees
may be deemed to have financed any activity which is primarily intended to
result in the sale of the Trust's shares (within the meaning of Rule 12b-1), all
those Distribution and Service Fees paid by the Trust shall be deemed to be made
under this Plan and pursuant to clause (b) of such Rule.
Dated: _______________________, 2000
