1
EXHIBIT 13(b)
CLASS B DISTRIBUTION PLAN OF
MERCURY INTERNATIONAL FUND OF
MERCURY ASSET MANAGEMENT FUNDS, INC.
PURSUANT TO RULE 12B-1
DISTRIBUTION PLAN made as of the ___ day of ____, 1998, by and between
Mercury Asset Management Funds, Inc., a Maryland corporation (the
"Corporation"), on behalf of its series, Mercury International Fund (the
"Fund"), and Mercury Funds Distributor, a division of Princeton Funds
Distributor, Inc., a Delaware corporation (the "Distributor").
W I T N E S S E T H:
WHEREAS, the Corporation intends to engage in business as an open-end
investment company registered under the Investment Company Act of 1940, as
amended (the "Investment Company Act"); and
WHEREAS, the Directors of the Corporation (the "Directors") are
authorized to establish separate series relating to separate portfolios of
securities, each of which may offer separate classes of shares, and
WHEREAS, the Directors have established the Fund as a series of the
Corporation;
WHEREAS, the Distributor is a securities firm engaged in the business of
selling shares of investment companies either directly to purchasers or through
other securities dealers; and
WHEREAS, the Corporation on behalf of the Fund proposes to enter into a
Class B Shares Distribution Agreement with the Distributor, pursuant to which
the Distributor will act as the exclusive distributor and representative of the
Fund in the offer and sale of Class B shares of common stock, par value $0.0001
per share (the "Class B Shares"), of the Fund to the public; and
WHEREAS, the Corporation on behalf of the Fund desires to adopt this
Class B Distribution Plan (the "Plan") pursuant to Rule 12b-1 under the
Investment Company Act pursuant to which the Fund will pay an account
maintenance fee and a distribution fee to the Distributor with respect to the
Fund's Class B Shares; and
WHEREAS, the Directors of the Corporation have determined that there is
a reasonable likelihood that adoption of the Plan will benefit the Fund and its
Class B shareholders.
NOW, THEREFORE, the Corporation on behalf of the Fund hereby adopts, and
the Distributor hereby agrees to the terms of, the Plan in accordance with Rule
12b-1 under the Investment Company Act on the following terms and conditions:
2
1. The Corporation shall pay the Distributor with respect to the
Class B Shares an account maintenance fee under the Plan at the end of each
month at the annual rate of 0.25% of average daily net assets of the Fund
relating to the Class B Shares to compensate the Distributor and securities
firms with which the Distributor enters into related agreements pursuant to
Paragraph 3 hereof ("Sub-Agreements") for providing account maintenance
activities with respect to Class B shareholders of the Fund. Expenditures under
the Plan may consist of payments to financial consultants for maintaining
accounts in connection with Class B Shares and payment of expenses incurred in
connection with such account maintenance activities including the costs of
making services available to shareholders including assistance in connection
with inquiries related to shareholder accounts.
2. The Corporation shall pay the Distributor a distribution fee
under the Plan at the end of each month at the annual rate of 0.75% of average
daily net assets of the Fund relating to Class B Shares to compensate the
Distributor and the securities firms with which the Distributor enters into
related Sub-Agreements for providing sales and promotional activities and
services. Such activities and services will relate to the sale, promotion and
marketing of the Class B Shares. Such expenditures may consist of sales
commissions to financial consultants for selling Class B Shares, compensation,
sales incentives and payments to sales and marketing personnel, and the payment
of expenses incurred in its sales and promotional activities, including
advertising expenditures related to the Fund and the costs of preparing and
distributing promotional materials. The distribution fee may also be used to pay
the financing costs of carrying the unreimbursed expenditures described in this
paragraph 2. Payment of the distribution fee described in this Paragraph 2 shall
be subject to any limitations set forth in any applicable regulation of the
National Association of Securities Dealers, Inc.
3. The Corporation hereby authorizes the Distributor to enter into
Sub-Agreements with certain securities firms ("Securities Firms"), including
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, to provide compensation to
such Securities Firms for activities and services of the type referred to in
Paragraphs 1 and 2 hereof. the Distributor may reallocate all or a portion of
its account maintenance fee or distribution fee to such Securities Firms as
compensation for the above-mentioned activities and services. Such Sub-Agreement
shall provide that the Securities Firms shall provide the Distributor with such
information as is reasonably necessary to permit the Distributor to comply with
the reporting requirements set forth in Paragraph 4 hereof.
4. The Distributor shall provide the Corporation for review by the
Board of Directors, and the Directors shall review at least quarterly, a written
report complying with the requirements of Rule 12b-1 regarding the disbursement
of the account maintenance fee and the distribution fee during such period.
5. This Plan shall not take effect until it has been approved,
together with any related agreements, by votes of a majority of both (a) the
Directors of the Corporation and (b) those Directors of the Corporation who are
not "interested persons" of the Corporation, as defined in
2
3
the Investment Company Act, and have no direct or indirect financial interest in
the operation of this Plan or any agreements related to it (the "Rule 12b-1
Directors"), cast in person at a meeting or meetings called for the purpose of
voting on the Plan and such related agreements.
6. The Plan shall continue in effect for so long as such
continuance is specifically approved at least annually in the manner provided
for approval of the Plan in Paragraph 5.
7. The Plan may be terminated at any time by vote of a majority of
the Rule 12b-1 Directors, or by vote of a majority of the outstanding Class B
voting securities of the Fund.
8. The Plan may not be amended to increase materially the rate of
payments provided for herein unless such amendment is approved by at least a
majority, as defined in the Investment Company Act, of the outstanding Class B
voting securities of the Fund, and by the Directors of the Corporation in the
manner provided for in Paragraph 5 hereof, and no material amendment to the Plan
shall be made unless approved in the manner provided for approval and annual
renewal in Paragraph 5 hereof.
9. While the Plan is in effect, the selection and nomination of
Directors who are not interested persons, as defined in the Investment Company
Act, of the Corporation shall be committed to the discretion of the Directors
who are not interested persons.
3
4
10. The Corporation shall preserve copies of the Plan and any
related agreements and all reports made pursuant to Paragraph 4 hereof, for a
period of not less than six years from the date of the Plan, or the date of such
agreement or report, as the case may be, the first two years in an easily
accessible place.
IN WITNESS WHEREOF, the parties hereto have executed this Plan as of the
date first above written.
MERCURY ASSET MANAGEMENT FUNDS, INC.
on behalf of its series,
MERCURY INTERNATIONAL FUND
By
------------------------------------------
Title: President
MERCURY FUNDS DISTRIBUTOR, a division of
PRINCETON FUNDS DISTRIBUTOR, INC.
By
------------------------------------------
Title: Vice President and Treasurer
4
5
CLASS B SHARES DISTRIBUTION PLAN SUB-AGREEMENT
AGREEMENT made as of the ____ day of _________, 1998 by and between
Mercury Funds Distributor, a division of Princeton Funds Distributor, Inc., a
Delaware corporation (the "Distributor"), and Xxxxxxx Lynch, Xxxxxx, Xxxxxx &
Xxxxx Incorporated, a Delaware corporation ("Securities Firm").
W I T N E S S E T H :
WHEREAS, the Distributor has entered into an agreement with Mercury
Asset Management Funds, Inc. a Maryland corporation (the "Corporation") on
behalf of its series, Mercury International Fund (the "Fund") pursuant to which
it acts as the exclusive distributor for the sale of Class B shares of common
stock of the Fund, par value $0.0001 per share (the "Class B Shares"); and
WHEREAS, the Distributor and the Corporation have entered into a Class B
Shares Distribution Plan (the "Plan") pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended (the "Act") pursuant to which the
Distributor receives an account maintenance fee from the Fund at the annual rate
of 0.25% of average daily net assets of the Fund relating to Class B Shares for
account maintenance activities related to the Class B Shares and a distribution
fee from the Fund at the annual rate of 0.75% of average daily net assets of the
Fund relating to Class B Shares for providing sales and promotional activities
and services related to the distribution of Class B Shares; and
WHEREAS, the Distributor desires the Securities Firm to perform certain
account maintenance activities and sales and promotional activities and services
for the Fund's Class B shareholders and the Securities Firm is willing to
perform such activities and services;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereby agree as follows:
1. The Securities Firm shall provide account maintenance activities
and services with respect to the Class B Shares of the types referred to in
Paragraph 1 of the Plan.
2. The Securities Firm shall provide sales and promotional
activities and services with respect to the sale of the Class B Shares and incur
distribution expenditures of the types referred to in paragraph 2 of the Plan.
3. As compensation for its activities and services performed under
this Agreement, the Distributor shall pay the Securities Firm an account
maintenance fee and a distribution fee at the end of each calendar month in an
amount agreed upon by the parties hereto.
6
4. The Securities Firm shall provide the Distributor, at least
quarterly, such information as reasonably requested by the Distributor to enable
the Distributor to comply with the reporting requirements of Rule 12b-1
regarding the disbursement of the account maintenance fee and the distribution
fee during such period referred to in Paragraph 4 of the Plan.
5. This Agreement shall not take effect until it has been approved
by votes of a majority of both (a) the Directors of the Corporation and (b)
those Directors of the Corporation who are not "interested persons" of the
Corporation, as defined in the Act, and have no direct or indirect financial
interest in the operation of this Plan or any agreements related to it (the
"Rule 12b-1 Directors"), cast in person at a meeting or meetings called for the
purpose of voting on this Agreement.
6. This Agreement shall continue in effect for as long as such
continuance is specifically approved at least annually in the manner provided
for approval of the Plan in Paragraph 5.
7. This Agreement shall automatically terminate in the event of its
assignment or in the event of the termination of the Plan or any amendment to
the Plan that requires such termination.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
MERCURY FUNDS DISTRIBUTOR, a division of
PRINCETON FUNDS DISTRIBUTOR, INC.
By
---------------------------------------
Name:
Title:
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By
---------------------------------------
Name:
Title:
2
