EXHIBIT e(2)(a)
FIRST AMENDED AND RESTATED
MASTER DISTRIBUTION AGREEMENT
BETWEEN
AIM INVESTMENT SECURITIES FUNDS
(CLASS B SHARES)
AND
A I M DISTRIBUTORS, INC.
THIS AGREEMENT made as of the 31st day of December, 2000, by and
between AIM INVESTMENT SECURITIES FUNDS, a Delaware business trust (the
"Trust"), with respect to each of the Class B shares (the "Shares") of each
series of shares of common stock set forth on Schedule A to this Agreement (the
"Portfolios"), and A I M DISTRIBUTORS, INC., a Delaware corporation (the
"Distributor").
WITNESSETH:
In consideration of the mutual covenants herein contained and other
good and valuable consideration, the receipt whereof is hereby acknowledged, the
parties hereto agree as follows:
FIRST: The Trust hereby appoints the Distributor as its exclusive agent
for the sale of the Shares to the public directly and through investment dealers
in the United States and throughout the world. If subsequent to the termination
of the Distributor's services to the Trust pursuant to this Agreement, the Trust
retains the services of another distributor, the distribution agreement with
such distributor shall contain provisions comparable to Clauses FOURTH and
SEVENTH hereof and Exhibit A hereto, and without limiting the generality of the
foregoing, will require such distributor to maintain and make available to the
Distributor records regarding sales, redemptions and reinvestments of Shares
necessary to implement the terms of Clauses FOURTH, SEVENTH and EIGHTH hereof.
SECOND: The Trust shall not sell any Shares except through the
Distributor and under the terms and conditions set forth in paragraph FOURTH
below. Notwithstanding the provisions of the foregoing sentence, however:
(A) the Trust may issue Shares to any other investment company or
personal holding company, or to the shareholders thereof, in exchange for all or
a majority of the shares or assets of any such company;
(B) the Trust may issue Shares at their net asset value in connection
with certain classes of transactions or to certain classes of persons, in
accordance with Rule 22d-1 under the Investment Company Act of 1940, as amended
(the "1940 Act"), provided that any such class is specified in the then current
prospectus of the applicable Shares; and
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(C) the Trust shall have the right to specify minimum amounts for
initial and subsequent orders for the purchase of Shares.
THIRD: The Distributor hereby accepts appointment as exclusive agent
for the sale of the Shares and agrees that it will use its best efforts to sell
such Shares; provided, however, that:
(A) the Distributor may, and when requested by the Trust on behalf of
the Shares shall, suspend its efforts to effectuate such sales at any time when,
in the opinion of the Distributor or of the Trust, no sales should be made
because of market or other economic considerations or abnormal circumstances of
any kind;
(B) the Trust may withdraw the offering of the Shares (i) at any time
with the consent of the Distributor, or (ii) without such consent when so
required by the provisions of any statute or of any order, rule or regulation of
any governmental body having jurisdiction; and
(C) the Distributor, as agent, does not undertake to sell any specific
amount of the Shares.
FOURTH:
(A) The public offering price of the Shares shall be the net asset
value per share of the applicable Shares. Net asset value per share shall be
determined in accordance with the provisions of the then current prospectus and
statement of additional information of the applicable Portfolio. The Distributor
may establish a schedule of contingent deferred sales charges to be imposed at
the time of redemption of the Shares, and such schedule shall be disclosed in
the current prospectus or statement of additional information of each Portfolio.
Such schedule of contingent deferred sales charges may reflect variations in or
waivers of such charges on redemptions of Shares, either generally to the public
or to any specified class of shareholders and/or in connection with any
specified class of transactions, in accordance with applicable rules and
regulations and exemptive relief granted by the Securities and Exchange
Commission, and as set forth in the Portfolios' current prospectus(es) or
statement(s) of additional information. The Distributor and the Trust shall
apply any then applicable scheduled variation in or waiver of contingent
deferred sales charges uniformly to all shareholders and/or all transactions
belonging to a specified class.
(B) The Distributor may pay to investment dealers and other financial
institutions through whom Shares are sold, such sales commission as the
Distributor may specify from time to time. Payment of any such sales commissions
shall be the sole obligation of the Distributor.
(C) No provision of this Agreement shall be deemed to prohibit any
payments by the Trust to the Distributor or by the Trust or the Distributor to
investment dealers, financial institutions and 401(k) plan service providers
where such payments are made under a distribution plan adopted by the Trust
pursuant to Rule 12b-1 under the 1940 Act.
(D) The Trust shall redeem the Shares from shareholders in accordance
with the terms set forth from time to time in the current prospectus and
statement of additional information of each Portfolio. The price to be paid to a
shareholder to redeem the Shares shall be equal to the net asset value of the
Shares being redeemed ("gross redemption proceeds"), less any applicable
contingent deferred sales charge, calculated pursuant to the then applicable
schedule of contingent deferred sales charges ("net redemption proceeds"). The
Distributor shall be entitled to receive the amount of the contingent deferred
sales charge that has been subtracted from gross redemption proceeds
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(the "CDSC"), provided that the Shares being redeemed were (i) issued by a
Portfolio during the term of this Agreement and any predecessor Agreement
between the Trust or its predecessor and the Distributor or (ii) issued by a
Portfolio during or after the term of this Agreement or any predecessor
Agreement between the Trust or its predecessor and the Distributor in one or a
series of free exchanges of Shares for Class B shares of another portfolio,
which can be traced to Shares or Class B shares of another portfolio initially
issued by a Portfolio or such other portfolio during the term of this Agreement,
any predecessor Agreement or any other distribution agreement with the
Distributor with respect to such other portfolio (the "Distributor's Earned
CDSC"). The Trust shall pay or cause the Trust's transfer agent to pay the
Distributor's Earned CDSC to the Distributor on the date net redemption proceeds
are payable to the redeeming shareholder.
(E) The Distributor shall maintain adequate books and records to
identify Shares (i) issued by a Portfolio during the term of this Agreement and
any predecessor Agreement between the Trust or its predecessor and the
Distributor or (ii) issued by a Portfolio during or after the term of this
Agreement or any predecessor Agreement between the Trust or its predecessor and
the Distributor in one or a series of free exchanges of Shares for Class B
shares of another portfolio, which can be traced to Shares or Class B shares of
another portfolio initially issued by a Portfolio or such other portfolio during
the term of this Agreement, any predecessor Agreement or any other distribution
agreement with the Distributor with respect to such other portfolio and shall
calculate the Distributor's Earned CDSC, if any, with respect to such Shares,
upon their redemption. The Trust shall be entitled to rely on Distributor's
books, records and calculations with respect to Distributor's Earned CDSC.
FIFTH: The Distributor shall act as an agent of the Trust in connection
with the sale and redemption of Shares. Except with respect to such sales and
redemptions, the Distributor shall act as principal in all matters relating to
the promotion of the sale of Shares and shall enter into all of its own
engagements, agreements and contracts as principal on its own account. The
Distributor shall enter into agreements with investment dealers and financial
institutions selected by the Distributor, authorizing such investment dealers
and financial institutions to offer and sell the Shares to the public upon the
terms and conditions set forth therein, which shall not be inconsistent with the
provisions of this Agreement. Each agreement shall provide that the investment
dealer or financial institution shall act as a principal, and not as an agent,
of the Trust.
SIXTH: The Shares shall bear:
(A) the expenses of qualification of Shares for sale in connection with
such public offerings in such states as shall be selected by the Distributor,
and of continuing the qualification therein until the Distributor notifies the
Trust that it does not wish such qualification continued; and
(B) all legal expenses in connection with the foregoing.
SEVENTH:
(A) The Distributor shall bear the expenses of printing from the final
proof and distributing the prospectuses and statements of additional information
for the Shares (including supplements thereto) relating to public offerings made
by the Trust pursuant to such prospectuses (which shall not include those
prospectuses and statements of additional information, and supplements thereto,
to be distributed to existing shareholders of the Shares), and any other
promotional or sales literature used by the Distributor or furnished by the
Distributor to dealers in
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connection with such public offerings, and expenses of advertising in connection
with such public offerings.
(B) Subject to the limitations, if any, of applicable law including the
NASD Conduct Rules (formerly, the NASD Rules of Fair Practice) regarding
asset-based sales charges, the Trust shall pay to the Distributor as a
reimbursement for all or a portion of such expenses, or as reasonable
compensation for distribution of the Shares, an asset-based sales charge in an
amount equal to 0.75% per annum of the average daily net asset value of the
Shares of each Portfolio from time to time (the "Distributor's 12b-1 Share"),
such sales charge to be payable pursuant to the distribution plan adopted
pursuant to Rule 12b-1 under the 1940 Act (the "Plan"). The Distributor's 12b-1
Share shall be a percentage, which shall be recomputed periodically (but not
less than monthly) in accordance with Exhibit A to this Agreement. The
Distributor's 12b-1 Share shall accrue daily and be paid to the Distributor as
soon as practicable after the end of each calendar month within which it accrues
but in any event within 10 business days after the end of each such calendar
month (unless the Distributor shall specify a later date in written instructions
to the Trust) provided, however, that any notices and calculation required by
Section EIGHTH: (B) and (C) have been received by the Trust.
(C) The Distributor shall maintain adequate books and records to permit
calculations periodically (but not less than monthly) of, and shall calculate on
a monthly basis, the Distributor's 12b-1 Share to be paid to the Distributor.
The Trust shall be entitled to rely on Distributor's books, records and
calculations relating to Distributor's 12b-1 Share.
EIGHTH:
(A) The Distributor 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 Distributor's 12b-1 Share (but not the
Distributor's duties and obligations pursuant hereto or pursuant to the Plan),
and (ii) the Distributor's Earned CDSC, free and clear of any offsets or claims
the Trust may have against the Distributor. Each such Assignee's ownership
interest in a Transfer of a designated portion of a Distributor's 12b-1 Share
and a Distributor's Earned CDSC is hereinafter referred to as an "Assignee's
12b-1 Portion" and an "Assignee's CDSC Portion," respectively. A Transfer
pursuant to this Section EIGHTH: (A) shall not reduce or extinguish any claim of
the Trust against the Distributor.
(B) The Distributor shall promptly notify the Trust in writing of each
Transfer pursuant to Section EIGHTH: (A) by providing the Trust with the name
and address of each such Assignee.
(C) The Distributor may direct the Trust to pay directly to an Assignee
such Assignee's 12b-1 Portion and Assignee's CDSC Portion. In such event,
Distributor shall provide the Trust with a monthly calculation of (i) the
Distributor's Earned CDSC and Distributor's 12b-1 Share and (ii) each Assignee's
12b-1 Portion and Assignee's CDSC Portion, if any, for such month (the "Monthly
Calculation"). The Monthly Calculation shall be provided to the Trust by the
Distributor promptly after the close of each month or such other time as agreed
to by the Trust and the Distributor which allows timely payment of the
Distributor's 12b-1 Share and Distributor's Earned CDSC and/or the Assignee's
12b-1 Portion and Assignee's CDSC Portion. The Trust shall not be liable for any
interest on such payments occasioned by delayed delivery of the Monthly
Calculation by the Distributor. In such event following receipt from the
Distributor of (i) notice of Transfer referred to in Section EIGHTH: (B) and
(ii) each Monthly Calculation, the Trust shall make all payments directly to the
Assignee or Assignees in accordance with the information provided in such notice
and
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Monthly Calculation, on the same terms and conditions as if such payments were
to be paid directly to the Distributor. The Trust shall be entitled to rely on
Distributor's notices, and Monthly Calculations in respect of amounts to be paid
pursuant to this Section EIGHTH: (B).
(D) Alternatively, in connection with a Transfer the Distributor may
direct the Trust to pay all of such Distributor's 12b-1 Share and Distributor's
Earned CDSC 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 such Distributor's 12b-1 Share and Distributor's Earned CDSC between
the Assignee's 12b-1 Portion and Assignee's CDSC Portion and the balance of the
Distributor's 12b-1 Share (such balance, when distributed to the Distributor by
the depository or collection agent, the "Distributor's 12b-1 Portion") and of
the Distributor's Earned CDSC (such balance, when distributed to the Distributor
by the depository or collection agent, the "Distributor's Earned CDSC Portion"),
in which case only the Distributor's 12b-1 Portion and Distributor's Earned CDSC
Portion may be subject to offsets or claims the Trust may have against the
Distributor.
(E) The Trust shall not amend the Plan to reduce the amount payable to
the Distributor or any Assignee under Section SEVENTH: (B) hereof with respect
to the Shares for any Shares which have been issued prior to the date of such
amendment.
NINTH: The Distributor will accept orders for the purchase of Shares
only to the extent of purchase orders actually received and not in excess of
such orders, and it will not avail itself of any opportunity of making a profit
by expediting or withholding orders.
TENTH:
(A) Pursuant to the Plan and this Agreement, the Distributor shall
enter into Shareholder Service Agreements with investment dealers (including
itself acting as principal), financial institutions and certain 401(K) plan
service providers (collectively "Service Providers") selected by the Distributor
for the provision of certain continuing personal services to customers of such
Service Providers who have purchased Shares. Such agreements shall authorize
Service Providers to provide continuing personal shareholder services to their
customers upon the terms and conditions set forth therein, which shall not be
inconsistent with the provisions of this Agreement. Each Shareholder Service
Agreement shall provide that the Service Provider shall act as principal, and
not as an agent of the Trust.
(B) Shareholder Service Agreements may provide that the Service
Providers may receive a service fee in the amount of .25% of the average daily
net assets of the Shares held by customers of such Service Providers provided
that such Service Providers furnish continuing personal shareholder services to
their customers in respect of such Shares. The continuing personal services to
be rendered by Service Providers under the Shareholder Service Agreements may
include, but shall not be limited to, some or all of the following: distributing
sales literature; answering routine customer inquiries concerning the Trust;
assisting customers in changing dividend elections, options, account
designations and addresses, and in enrolling in any of several special
investment plans offered in connection with the purchase of Shares; assisting in
the establishment and maintenance of or establishing and maintaining customer
accounts and records and the processing of purchase and redemption transactions;
performing subaccounting; investing dividends and any capital gains
distributions automatically in the Trust's shares; providing periodic statements
showing a customer's account balance and the integration of such statements with
those of other transactions and balances in the customer's account serviced by
the Service Provider; forwarding applicable prospectus, proxy statements,
reports and notices to customers who hold
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Shares and providing such other information and services as the Trust or the
customers may reasonably request.
(C) The Distributor may advance service fees payable to Service
Providers pursuant to the Plan or any other distribution plan adopted by the
Trust with respect to Shares of one or more of the Portfolios pursuant to Rule
12b-1 under the 1940 Act; and thereafter the Distributor may be reimbursed for
such advances through retention of service fee payments during the period for
which the service fees were advanced.
ELEVENTH: The Trust and the Distributor shall each comply with all
applicable provisions of the 1940 Act, the Securities Act of 1933, as amended,
and of all other federal and state laws, rules and regulations governing the
issuance and sale of the Shares.
TWELFTH:
(A) In the absence of willful misfeasance, bad faith, gross negligence
or reckless disregard of obligations or duties hereunder on the part of the
Distributor, the Trust shall indemnify the Distributor against any and all
claims, demands, liabilities and expenses which the Distributor may incur under
the Securities Act of 1933, or common law or otherwise, arising out of or based
upon any alleged untrue statement of a material fact contained in any
registration statement or prospectus of the Shares, or any omission to state a
material fact therein, the omission of which makes any statement contained
therein misleading, unless such statement or omission was made in reliance upon,
and in conformity with, information furnished to the Trust in connection
therewith by or on behalf of the Distributor. The Distributor shall indemnify
the Trust and the Shares against any and all claims, demands, liabilities and
expenses which the Trust or the Shares may incur arising out of or based upon
(i) any act or deed of the Distributor or its sales representatives which has
not been authorized by the Trust in its prospectus or in this Agreement and (ii)
the Trust's reliance on the Distributor's books, records, calculations and
notices in Sections FOURTH: (E), SEVENTH: (C), EIGHTH: (B), EIGHTH: (C) and
EIGHTH: (D).
(B) The Distributor shall indemnify the Trust and the Shares against
any and all claims, demands, liabilities and expenses which the Trust or the
Shares may incur under the Securities Act of 1933, as amended, or common law or
otherwise, arising out of or based upon any alleged untrue statement of a
material fact contained in any registration statement or prospectus of the
Shares, or any omission to state a material fact therein if such statement or
omission was made in reliance upon, and in conformity with, information
furnished to the Trust in connection therewith by or on behalf of the
Distributor.
(C) Notwithstanding any other provision of this Agreement, the
Distributor shall not be liable for any errors of the transfer agent(s) of the
Shares, or for any failure of any such transfer agent to perform its duties.
THIRTEENTH: Nothing herein contained shall require the Trust to take
any action contrary to any provision of its Agreement and Declaration of Trust
or to any applicable statute or regulation.
FOURTEENTH: This Agreement shall become effective with respect to the
Shares of each Portfolio upon its approval by the Board of Trustees of the Trust
and by vote of a majority of the Trust's trustees who are not interested parties
to this Agreement or "interested persons" (as defined in Section 2(a)(19) of the
0000 Xxx) of any party to this Agreement cast in person at a meeting called for
such purpose, shall continue in force and effect until June 30, 2001, and from
year to year
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thereafter, provided, that such continuance is specifically approved with
respect to the Shares of each Portfolio at least annually (a)(i) by the Board of
Trustees of the Trust or (ii) by the vote of a majority of the outstanding
Shares of such class of such Portfolio, and (b) by vote of a majority of the
Trust's trustees who are not parties to this Agreement or "interested persons"
(as defined in Section 2(a)(19) of the 0000 Xxx) of any party to this Agreement
cast in person at a meeting called for such purpose.
FIFTEENTH:
(A) This Agreement may be terminated with respect to the Shares of any
Portfolio, at any time, without the payment of any penalty, by vote of the Board
of Trustees of the Trust or by vote of a majority of the outstanding Shares of
such Portfolio, or by the Distributor, on sixty (60) days' written notice to the
other party; and
(B) 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 1940 Act; provided, that, subject to the provisions of the
following sentence, if this Agreement is terminated for any reason, the
obligations of the Trust and the Distributor pursuant to Sections FOURTH: (D),
FOURTH: (E), SEVENTH: (B), SEVENTH: (C), EIGHTH: (A) through (E) and TWELFTH:
(A) of this Agreement will continue and survive any such termination.
Notwithstanding the foregoing, upon Complete Termination of the Plan (as such
term is defined in Section 8 of the Plan in effect at the date of this
Agreement), the obligations of the Trust pursuant to the terms of Sections
SEVENTH: (B), EIGHTH: (A), EIGHTH: (C), EIGHTH: (D) and EIGHTH: (E) (with
respect to payments of Distributor's 12b-1 Share and Assignee's 12b-1 Portion)
of this Agreement shall terminate. A termination of the Plan with respect to any
or all Shares of any or all Portfolios shall not affect the obligations of the
Trust pursuant to Sections FOURTH: (D), EIGHTH: (A), EIGHTH: (C), EIGHTH: (D)
and EIGHTH: (E) (with respect to payments of Distributor's Earned CDSC or
Assignee's CDSC Portion) hereof or of the obligations of the Distributor
pursuant to Section FOURTH: (E) or EIGHTH: (B) hereof.
(C) The Transfer of the Distributor's rights to Distributor's 12b-1
Share or Distributor's Earned CDSC shall not cause a termination of this
Agreement or be deemed to be an assignment for purposes of Section FIFTEENTH:
(B) above.
SIXTEENTH: Any notice under this Agreement shall be in writing,
addressed and delivered, or mailed postage prepaid, to the other party at such
address as the other party may designate for the receipt of notices. Until
further notice to the other party, the addresses of both the Trust and the
Distributor shall be 00 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000-0000.
SEVENTEENTH: Notice is hereby given that, as provided by applicable
law, the obligations of or arising out of this Agreement are not binding upon
any of the shareholders of the Trust individually, but are binding only upon the
assets and property of the Trust and that the shareholders shall be entitled, to
the fullest extent permitted by applicable law, to the same limitation on
personal liability as stockholders of private corporations for profit.
EIGHTEENTH: This Agreement shall be governed by and construed in
accordance with the laws (without reference to conflicts of law provisions) of
the State of Delaware.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed in duplicate on the day and year first above written.
AIM INVESTMENT SECURITIES FUNDS
By: /s/ XXXXXX X. XXXXXX
---------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
Attest:
/s/ XXXXX X. XXXXXXX
----------------------------
Name:
Title:
A I M DISTRIBUTORS, INC.
By: /s/ XXXXXXX X. XXXX
---------------------------
Name: Xxxxxxx X. Xxxx
Title: President
Attest:
/s/ XXXX X. XXXX
----------------------------
Name:
Title:
8
SCHEDULE A
TO
FIRST AMENDED AND RESTATED
MASTER DISTRIBUTION AGREEMENT
OF
AIM INVESTMENT SECURITIES FUNDS
CLASS B SHARES
AIM High Yield Fund
AIM High Yield Fund II
AIM Income Fund
AIM Intermediate Government Fund
AIM Money Market Fund
AIM Municipal Bond Fund
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As of June 1, 2000
EXHIBIT A
The Distributor's 12b-1 Share in respect of each Portfolio
shall be 100 percent until such time as the Distributor shall cease to serve as
exclusive distributor of the Shares of such Portfolio and thereafter shall be a
percentage, recomputed first on the date of any termination of the Distributor's
services as exclusive distributor of Shares of any Portfolio and thereafter
periodically (but not less than monthly), representing the percentage of Shares
of such Portfolio outstanding on each such computation date allocated to the
Distributor in accordance with the following rules:
1. DEFINITIONS. For purposes of this Exhibit A 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 Shares" shall mean shares of the
Portfolio or another portfolio the redemption of which would, in the absence of
the application of some standard waiver provision, give rise to the payment of a
CDSC and shall include Commission Shares which due to the expiration of the CDSC
period no longer bear a CDSC.
"Distributor" shall mean the Distributor.
"Other Distributor" shall mean each person appointed
as the exclusive distributor for the Shares of the Portfolio after the
Distributor ceases to serve in that capacity.
2. ALLOCATION RULES. In determining the Distributor's
12b-1 Share in respect of a particular Portfolio:
(a) There shall be allocated to the Distributor and
each Other Distributor all Commission Shares of such Portfolio which were sold
while such Distributor or such Other Distributor, as the case may be, was the
exclusive distributor for the Shares of the Portfolio, determined in accordance
with the transfer records maintained for such Portfolio.
(b) Reinvested Shares: On the date that any Shares
are issued by a Portfolio as a result of the reinvestment of dividends or other
distributions, whether ordinary income, capital gains or exempt-interest
dividends or distributions ("Reinvested Shares"), Reinvested Shares shall be
allocated to the Distributor and each Other Distributor in a number obtained by
multiplying the total number of Reinvested Shares issued on such date by a
fraction, the numerator of which is the total number of all Shares outstanding
in such Portfolio as of the opening of business on such date and allocated to
the Distributor or Other Distributor as of such date of determination pursuant
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to these allocation procedures and the denominator is the total number of Shares
outstanding as of the opening of business on such date.
(c) Exchange Shares: There shall be allocated to the
Distributor and each Other Distributor, as the case may be, all Commission
Shares of such Portfolio which were issued during or after the period referred
to in (a) as a consequence of one or more free exchanges of Commission Shares of
the Portfolio or of another portfolio (other than Free Appreciation Shares) (the
"Exchange Shares"), which in accordance with the transfer records maintained for
such Portfolio can be traced to Commission Shares of the Portfolio or another
portfolio initially issued by the Trust or such other portfolio during the time
the Distributor or such Other Distributor, as the case may be, was the exclusive
distributor for the Shares of the Portfolio or such other portfolio.
(d) Free Appreciation Shares: Shares (other than
Exchange Shares) that were acquired by the holders of such Shares in a free
exchange of Shares of any other Portfolio, which represent the appreciated value
of the Shares of the exiting portfolio over the initial purchase price paid for
the Shares being redeemed and exchanged and for which the original purchase date
and the original purchase price are not identified on an on-going basis, shall
be allocated to the Distributor and each Other Distributor ("Free Appreciation
Shares") daily in a number obtained by multiplying the total number of Free
Appreciation Shares issued by the exiting portfolio on such date by a fraction,
the numerator of which is the total number of all Shares outstanding as of the
opening of business on such date allocated to the Distributor or such Other
Distributor as of such date of determination pursuant to these allocation
procedures and the denominator is the total number of Shares outstanding as of
the opening of business on such date.
(e) Redeemed Shares: Shares (other than Reinvested
Shares and Free Appreciation Shares) that are redeemed will be allocated to the
Distributor and each Other Distributor to the extent such Share was previously
allocated to the Distributor or such Other Distributor in accordance with the
rules set forth in 2(a) or (c) above. Reinvested Shares and Free Appreciation
Shares that are redeemed will be allocated to the Distributor and each Other
Distributor daily in a number obtained by multiplying the total number of Free
Appreciation Shares and Reinvested Shares being redeemed by such Portfolio on
such date by a fraction, the numerator of which is the total number of all Free
Appreciation Shares and Reinvested Shares of such Portfolio outstanding as of
the opening of business on such date allocated to the Distributor or such Other
Distributor as of such date of determination pursuant to these allocation
procedures and the denominator is the total number of Free Appreciation Shares
and Reinvested Shares of such Portfolio outstanding as of the opening of
business on such date.
The Trust shall use its best efforts to assure that the transfer agents
and sub-transfer agents for each Portfolio maintain the data necessary to
implement the foregoing rules. If, notwithstanding the foregoing, the transfer
agents or sub-transfer agents for such Portfolio are unable to maintain the data
necessary to implement the foregoing rules as written, or if the Distributor
shall cease to
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serve as exclusive distributor of the Shares of the Portfolio, the Distributor
and the Portfolio agree to negotiate in good faith with each other, with the
transfer agents and sub-transfer agents for such Portfolio and with any third
party that has obtained an interest in the Distributor's 12b-1 Share in respect
of such Portfolio with a view to arriving at mutually satisfactory modifications
to the foregoing rules designed to accomplish substantially identical results on
the basis of data which can be made available.
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