Exhibit 2(h)(ii)
PILGRIM SENIOR INCOME FUND
0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
March 1, 2001
AS AMENDED AND RESTATED MAY 9, 2001
ING Pilgrim Securities, Inc.
0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
Re: UNDERWRITING AGREEMENT
Ladies and Gentlemen:
Pilgrim Senior Income Fund is a Delaware business trust operating as a
closed-end management investment company (hereinafter referred to as the
"Fund"). The Fund has filed a registration statement on Form N-2 (File Nos.
333-54910 and 811-10223) (the "Registration Statement") under the Investment
Company Act of 1940, as amended (the "1940 Act") and the Securities Act of 1933,
as amended (the "1933 Act") to register Classes A, B, C and Q common shares (the
"Common Shares") of the Fund which may be issued and sold to the public from
time to time.
You have informed us that ING Pilgrim Securities, Inc. is registered as a
broker-dealer under the provisions of the Securities Exchange Act of 1934 and is
a member in good standing of the National Association of Securities Dealers,
Inc. You have indicated your desire to act as distributor for certain Common
Shares of the Fund issued pursuant to the Registration Statement. We have been
authorized by the Fund to execute and deliver this agreement to you by a
resolution of our Board of Trustees (the "Trustees") adopted at a meeting of the
Trustees, at which a majority of Trustees, including a majority of our Trustees
who are not otherwise interested persons of the Fund, its investment manager or
its related organizations, were present and voted in favor of the said
resolution approving this Underwriting Agreement.
1. APPOINTMENT OF UNDERWRITER. Upon the execution of this Underwriting
Agreement and in consideration of the agreements on your part herein expressed
and upon the terms and conditions set forth herein, we hereby appoint you as the
exclusive distributor of the Common Shares and agree that we will deliver to you
such Common Shares as may be sold through your efforts. You agree to use
reasonable efforts to promote the sale of the Common Shares, but you are not
obligated to sell any specific number of the Common Shares.
2. INDEPENDENT CONTRACTOR. You will undertake and discharge your
obligations hereunder as an independent contractor and shall have no authority
or power to obligate or bind the Fund by your actions, conduct or contracts,
except that you are authorized to accept orders for the purchase or repurchase
of the Common Shares as our agent. You may appoint sub-agents or distribute the
Common Shares through dealers (or otherwise) as you may determine necessary or
desirable from time to time. This Agreement shall not, however, be construed as
authorizing any dealer or other person to accept orders for sale or repurchase
on our behalf or to otherwise act as our agent for any purpose.
3. OFFERING PRICE.
(a) As of its initial public offering, the Fund will offer Classes B,
C and Q Common Shares at a price of $15.00 per share. Thereafter, Common Shares
of each Class of the Fund shall be offered in a continuous public offering at a
price equivalent to its net asset value per share, with any applicable sales
charge, as set forth in the Fund's Prospectus. Class A Common Shares are
available only upon conversion of Class B Common Shares at the end of eight
years or upon exchanges from other Pilgrim funds.
(b) On each business day on which the New York Stock Exchange is open
for business, we will furnish you with the net asset value of the Common Shares,
which shall be determined and become effective as of the time described in the
Fund's prospectus. The net asset value so determined shall apply to all orders
for the purchase of Common Shares received by dealers prior to the time as of
which net asset value is determined, and you are authorized in your capacity as
our agent to accept orders and confirm sales at such net asset value; provided
that, such dealers notify you of the time when they received the particular
order and that the order is placed with you prior the time as of which net asset
value is determined. To the extent that our Shareholder Servicing and Transfer
Agent (collectively, "Agent") and the Custodian(s) for any pension,
profit-sharing, employer or self-employed plan receive payments on behalf of the
investors, such Agent and Custodian(s) shall be required to record the time of
such receipt with respect to each payment, and the applicable net asset value
shall be that which is next determined and effective after the time of receipt
by them. In all events, you shall forthwith notify all of the dealers comprising
your selling group and the Agent and Custodian(s) of the effective net asset
value as received from us. Should we at any time calculate our net asset value
more frequently than once each business day, you and we will follow procedures
with respect to such additional price or prices comparable to those set forth
above in this Section 3.
(c) You may enter into selected dealer agreements, on such terms and
conditions as you determine are not inconsistent with this Agreement, with
financial services firms, including broker-dealers, for the sale of Common
Shares. You are further authorized to pay a sales commission to such firms with
which you have sales agreements on sales of Common Shares from your own assets
as set forth in the Prospectus. Such firms shall sell Common Shares only at the
net asset value per share of such Common Shares. This Underwriting Agreement
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shall not be construed as authorizing any broker-dealer or other person to
accept orders for sale on our behalf or to otherwise act as our agent for any
purpose. You shall not be responsible for the acts of any financial services
firms except as and to the extent that they shall be acting for you or under
your direction or authority.
4. ORDERS. You shall promptly advise us of all purchase orders for Common
Shares of the Fund received by you. Any order may be rejected by us; provided,
however, that we will not arbitrarily or without reasonable cause refuse to
accept or confirm orders for the purchase of Common Shares of the Fund. We or
our agent will confirm orders upon receipt, will make appropriate book entries
and, upon receipt by the Fund (or its agent) of payment therefor, will deliver
deposit receipts for Common Shares.
5. (a) In respect of the Class B Common Shares of the Fund, the
following provisions shall apply:
(i) In consideration of your services as principal underwriter of
the Fund's Class B Common Shares pursuant to this Underwriting Agreement and our
distribution and service plan adopted pursuant to Rule 12b-1 under the 1940 Act
in respect of such Class B Common Shares (the "Class B Distribution and Service
Plan"), we agree: (I) to pay to you or, at your direction, to a third party,
monthly in arrears your "Allocable Portion" (as hereinafter defined) of a fee
(the "Distribution Fee") which shall accrue daily in an amount equal to the
product of (A) the daily equivalent of 1.00% per annum multiplied by (B) the net
asset value of the Class B Common Shares of the Fund outstanding on such day,
and (II) to withhold from repurchase proceeds your Allocable Portion of the
early withdrawal charge, if any, and to pay the same over to you or at your
direction to a third party, at the time the repurchase proceeds for the
repurchased Class B Common Shares are payable to the holders repurchasing such
Class B Common Shares.
(ii) Each of the provisions set forth in clauses (I) through (V)
of the second sentence of Section 1(A) of the Class B Distribution and Service
Plan as in effect on the date hereof, together with the related definitions, are
hereby incorporated herein by reference with the same force and effect as if set
forth herein in their entirety.
(iii) In addition to the payments of amounts provided for in
Section 5(a)(i) and (ii), you may also receive reimbursement for expenses or a
maintenance or trail fee as may be required by and described in the Class B
Distribution and Service Plan.
(b) In respect of the Class C and Class Q Common Shares of the Fund,
the following provisions shall apply:
(i) You are entitled to receive a sales commission on the sale of
Class C and Class Q Common Shares of the Fund in the amounts and according to
the procedures set forth in the Fund's Prospectus then in effect under the 1933
Act (including any supplements or amendments thereto.)
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(ii) In addition to the payments of amounts provided for in
Section 5(b)(i), you may also receive reimbursement for expenses or a
maintenance or trail fee as may be required by and described in the distribution
and service plan adopted pursuant to Rule 12b-1 under the 1940 Act in respect of
such Class C Common Shares (the "Class C Distribution and Service Plan") and the
shareholder service plan in respect of such Class Q Common Shares (the "Class Q
Shareholder Service Plan").
6. PAYMENT OF COMMON SHARES. At or prior to the time of delivery of any of
our Common Shares you will pay or cause to be paid to the Custodian, for our
account, an amount in cash equal to the net asset value of such Common Shares.
In the event that you pay for Common Shares sold by you prior to your receipt of
payment from purchasers, you are authorized to reimburse yourself for the net
asset value of such Common Shares from the offering price of such Common Shares
when received by you.
7. REPURCHASES. Periodic repurchases of Common Shares will be made on a
quarterly basis starting in August 2001 in accordance with the Fund's
Fundamental Policy on Repurchase Offers adopted in accordance with Rule 23c-3 of
the 1940 Act. In the future, repurchases may be made monthly. The terms of each
repurchase offer, including the price to be paid, and the amount of any
applicable early withdrawal charge to be retained by the Fund, (the "repurchase
price") shall be set forth in each notification to record holders and beneficial
owners of Common Shares preceding each repurchase offer.
8. REGISTRATION OF COMMON SHARES. No Common Shares shall be registered on
our books until (i) receipt by us of your written request therefor; (ii) receipt
by the Custodian and Agent of a certificate signed by an officer of the Fund
stating the amount to be received therefor; and (iii) receipt of payment of that
amount by the Custodian. We will provide for the recording of all Common Shares
purchased in unissued form in "book accounts."
9. PURCHASES FOR YOUR OWN ACCOUNT. You shall not purchase Common Shares for
your own account for purposes of resale to the public, but you may purchase
Common Shares for your own investment account upon your written assurance that
the purchase is for investment purposes only and that the Common Shares will not
be resold except through repurchase by the Fund.
10. SALE OF COMMON SHARES TO AFFILIATES. During the initial offering
period, you may sell the Class B, C and Q Common Shares at the initial offering
price as set forth in the Prospectus, and, thereafter, at net asset value per
share, with a sales charge, as appropriate, pursuant to the terms set forth in
the Fund's current Prospectus (i) to our Trustees and officers, our investment
manager or your company or affiliated companies thereof, (ii) to the bona fide,
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full time employees or sales representatives of any of the foregoing who have
acted as such for at least ninety (90) days, (iii) to any trust, pension,
profit-sharing, or other benefit plan for such persons, or (iv) to any other
person set forth in the Fund's then current Prospectus; provided, that such
sales are made in accordance with the rules and regulations under the 1940 Act
and that such sales are made upon the written assurance of the purchaser that
the purchases are made for investment purposes only, not for the purpose of
resale to the public and that the Common Shares will not be resold except
through repurchase by us.
11. ALLOCATION OF EXPENSES.
(a) We will pay the following expenses in connection with the sales
and distribution of Common Shares of the Fund:
(i) expenses pertaining to the preparation of our audited and
certified financial statements to be included in any amendments
("Amendments") to our Registration Statement under the 1933 Act,
including the Prospectuses and Statements of Additional Information
included therein;
(ii) expenses (including legal fees) pertaining to the
preparation and printing of all Amendments or supplements filed with
the Securities and Exchange Commission, including the copies of the
Prospectuses and Statements of Additional Information included in such
Amendments and the first ten (10) copies of the definitive
Prospectuses and Statements of Additional Information or supplements
thereto, other than those necessitated by or related to your
(including your "Parents") activities where such amendments or
supplements result in expenses which we would not otherwise have
incurred;
(iii) expenses pertaining to the preparation, printing, and
distribution of any reports or communications, including Prospectuses
and Statements of Additional Information, which are sent to our
existing shareholders;
(iv) filing and other fees to federal and state securities
regulatory authorities necessary to register and maintain registration
of the Common Shares; and
(v) expenses of the Agent, including all costs and expenses in
connection with the issuance, transfer and registration of the Common
Shares, including but not limited to any taxes and other governmental
charges in connection therewith.
(b) Except to the extent that you are entitled to reimbursement under
the provisions of the Class B or C Distribution and Service Plans or the Class Q
Service Plan for the Fund, you will pay the following expenses:
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(i) expenses of printing additional copies of the Prospectus
and Statement of Additional Information and any amendments
or supplements thereto which are necessary to continue to
offer our Common Shares to the public;
(ii) expenses (excluding legal fees) pertaining to the
preparation and printing of all amendments and supplements
to our Registration Statement if the Amendment or
supplement arises from or is necessitated by or related to
your (including your "Parent") activities where those
expenses would not otherwise have been incurred by us; and
(iii) expenses pertaining to the printing of additional copies,
for use by you as sales literature, of reports or other
communications which have been prepared for distribution to
our existing shareholders or incurred by you in
advertising, promoting and selling our Common Shares to the
public.
12. FURNISHING OF INFORMATION. We will furnish to you such information with
respect to the Fund and its Common Shares, in such form and signed by such of
our officers as you may reasonably request, and we warrant that the statements
therein contained when so signed will be true and correct. We will also furnish
you with such information and will take such action as you may reasonably
request in order to qualify our Common Shares for sale to the public under the
Blue Sky Laws or in jurisdictions in which you may wish to offer them. We will
furnish you at least annually with audited financial statements of our books and
accounts certified by independent public accountants, and with such additional
information regarding our financial condition, as you may reasonably request
from time to time.
13. CONDUCT OF BUSINESS. Other than the currently effective Prospectus and
Statement of Additional Information, you will not issue any sales material or
statements except literature or advertising which conforms to the requirements
of federal and state securities laws and regulations and which have been filed,
where necessary, with the appropriate regulatory authorities. You will furnish
us with copies of all such material prior to their use and no such material
shall be published if we shall reasonably and promptly object.
You shall comply with the applicable federal and state laws and regulations
where our Common Shares are offered for sale and conduct your affairs with us
and with dealers, brokers or investors in accordance with the Rules of Fair
Practice of the National Association of Securities Dealers, Inc.
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14. OTHER ACTIVITIES. Your services pursuant to this Agreement shall not be
deemed to be exclusive, and you may render similar services and act as an
underwriter, distributor or dealer for other investment companies in the
offering of their shares.
15. TERM OF AGREEMENT. This Agreement shall become effective on the date
first written above or on such later date approved by the Fund's Board of
Trustees, including a majority of those Trustees who are not parties to this
Agreement or interested persons (as such term is defined in the 1940 Act)
thereof. Unless terminated as provided herein, the Agreement shall continue in
full force and effect for two (2) years from the effective date of this
Agreement, and shall continue in effect from year to year thereafter for
successive one (1) year periods if approved at least annually (i) by a vote of a
majority of the outstanding voting securities of the Funds or by a vote of the
Trustees of the Fund, and (ii) by a vote of a majority of the Trustees of the
Fund who are not interested persons or parties to this Agreement (other than as
Trustees of the Fund), cast in person at a meeting called for the purpose of
voting on this Agreement.
16. TERMINATION. This Agreement: (i) may be terminated at any time without
the payment of any penalty, either by vote of the Trustees of the Fund or by a
vote of a majority of the outstanding voting securities of the Funds, on sixty
(60) days' written notice to you; (ii) shall terminate immediately in the event
of its assignment; and (iii) may be terminated by you on sixty (60) days'
written notice to us.
17. SUSPENSION OF SALES. We reserve the right at all times to suspend or
limit the public offering of the Common Shares upon written notice to you, and
to reject any order in whole or in part.
18. MISCELLANEOUS. This Agreement shall be subject to the laws of the State
of Arizona and shall be interpreted and construed to further and promote the
operation of the Fund as an open-end investment company. As used herein, the
terms "Net Asset Value," "Offering Price," "Investment Company," "Closed-End
Investment Company," "Assignment," "Principal Underwriter," "Interested Person,"
"Parents," and "Majority of the Outstanding Voting Securities," shall have the
meanings set forth in the 1933 Act and the 1940 Act, as applicable, and the
rules and regulations promulgated thereunder.
19. LIABILITY. Nothing contained herein shall be deemed to protect you
against any liability to us or to our shareholders to which you would otherwise
be subject by reason of willful misfeasance, bad faith or gross negligence in
the performance of your duties hereunder, or by reason of your reckless
disregard of your obligations and duties hereunder.
20. AMENDMENT. This Agreement may be amended with respect to the Fund by
the parties only if such amendment is specifically approved by (a) the Trustees
or by the vote of a majority of the outstanding voting securities of the Fund,
and (b) by the by a vote of a majority of the Trustees of the Fund who are not
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interested persons or parties to this Agreement, cast in person at a meeting
called for the purpose of voting on such amendment.
If the foregoing meets with your approval, please acknowledge your
acceptance by signing each of the enclosed counterparts hereof and returning
such counterparts to us, whereupon this shall constitute a binding agreement as
of the date first above written.
Very truly yours,
PILGRIM SENIOR INCOME FUND
By:
------------------------------------
Senior Vice President
Agreed to and Accepted:
ING PILGRIM SECURITIES, INC.
By:
------------------------------
Senior Vice President
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SCHEDULE A
to the Underwriting Agreement
UNDERWRITING AGREEMENT ALLOCATION PROCEDURES
CDSCs, EWCs, and Distribution Fees related to Shares of the Funds that are
listed in the attached Schedule B shall be allocated by each Fund between ING
Pilgrim Securities, Inc. ("IPSI") and any replacement principal underwriter for
Shares of such Fund (the "Successor Distributor") in accordance with this
Schedule A.
Defined terms used in this Schedule A and not otherwise defined herein
shall have the meaning assigned to them in the Underwriting Agreement for Shares
of the Fund to which this Schedule A is attached. As used herein the following
terms shall have the meanings indicated.
"COMMISSION SHARE" means, 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 or EWC upon redemption of
such Share by the Fund (including, without limitation, any Share of such Fund
issued in connection with a Free Exchange) and any such Share shall continue to
be a Commission Share of such Fund prior to the repurchase (including a
redemption in connection with a Free Exchange or conversion of such Share, even
though the obligation to pay the CDSC or EWC may have expired or conditions for
waivers thereof may exist.
"DATE OF ORIGINAL ISSUANCE" means in respect of any Commission Share, the
date with reference to which the amount of the CDSC or EWC payable on redemption
thereof, if any, is computed.
"FREE EXCHANGE" means an exchange of a Commission Share of one Fund for a
Commission Share of another Fund under circumstances where the CDSC or EWC which
would have been payable in respect of a redemption of the exchanged Commission
Share on the date of such exchange is waived and the Commission Share issued in
such exchange is treated as a continuation of the investment in the Commission
Share exchanged for purposes of determining the CDSC or EWC payable if such
Commission Share issued in the exchange is thereafter redeemed.
"FREE SHARE" means, in respect of any Fund, each Share of such Fund, other
than a Commission Share, including, without limitation, any Share issued in
connection with the reinvestment of dividends or capital gains.
"INCEPTION DATE" means, in respect of any Fund, the first date on which
such Fund issued Shares.
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"NET ASSET VALUE" means, (i) with respect to any Fund, as of the date any
determination thereof is made, the net asset value of such Fund computed in the
manner such value is required to be computed by such Fund in its reports to its
shareholders, and (ii) with respect to any Share of such Fund as of any date,
the quotient obtained by dividing: (A) the net asset value of such Fund (as
computed in accordance with clause (i) above) allocated to Shares of such Fund
(in accordance with the constituent documents for such Fund) as of such date, by
(B) the number of Shares of such Fund outstanding on such date.
"OMNIBUS SHARE" means, in respect of the Fund, a Commission Share or Free
Share sold by one of the Selling Agents listed on Exhibit I to this Schedule. If
IPSI and its Transferees reasonably determine that the Transfer Agent is able to
track all Commission Shares and Free Shares sold by any of the Selling Agents
listed on Exhibit I (taking into account all information provided to the
Transfer Agent by such Selling Agent on a schedule sufficient to enable the
Transfer Agent to Complete all required reports involving such information in a
timely manner), in the same manner as Commission Shares and Free Shares are
currently tracked in respect of Selling Agents not listed on Exhibit I, then
Exhibit I shall be amended to delete such Selling Agent from Exhibit I so that
Commission Shares and Free Shares sold by such Selling Agent will no longer be
treated as Omnibus Shares.
"SHARE" means, in respect of any Fund, each Class B share of such Fund.
PART I: ATTRIBUTION OF SHARES
Shares of the Fund, which are outstanding from time to time, shall be
attributed to IPSI and any Successor Distributor in accordance with the
following rules;
(1) COMMISSION SHARES OTHER THAN OMNIBUS SHARES:
(a) Commission Shares (excluding Omnibus Shares) attributed to IPSI
shall be Commission Shares (excluding Omnibus Shares) the Date of Original
Issuance of which occurred on or after the Inception Date of such Fund and on or
prior to the last day on which IPSI acts as principal underwriter of Shares for
such Fund.
(b) Commission Shares (excluding Omnibus Shares) attributable to the
Successor Distributor shall be Commission Shares (excluding Omnibus Shares) the
Date of Original Issuance of which occurs on or after the first day on which
such Successor Distributor acts as principal underwriter of Shares for such Fund
and on or prior to the last day such Successor for Distributor acts as principal
underwriter of Shares for such Fund.
(c) A Commission Share (other than an Omnibus Share) of a particular
Fund (the "ISSUING FUND") issued in consideration of the investment of proceeds
of the redemption of a Commission Share of another Fund (the "REDEEMING FUND")
in connection with a Free Exchange, is deemed to have a Date of Original
Issuance identical to the Date of Original Issuance of the Commission Share of
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the Redeeming Fund and any such Commission Share will be attributed to IPSI or
the Successor Distributor based upon such Date of Original Issuance in
accordance with Part I(a) and (b) above.
(d) A Commission Share (other than an Omnibus Share) redeemed (other
than in connection with a Free Exchange) or converted to a Class A share is
attributable to IPSI or a Successor Distributor based upon the Date of Original
Issuance in accordance with Part I(1)(a), (b) and (c) above.
(2) FREE SHARES OTHER THAN OMNIBUS SHARES:
Free Shares (excluding Omnibus Shares) of a Fund outstanding on any date
shall be attributed to IPSI or a Successor Distributor, as the case may be, in
the same proportion that the Commission Shares (excluding Omnibus Shares) of
such Fund outstanding on such date are attributed to it on such date; PROVIDED
that if IPSI reasonably determines that the Transfer Agent or the Selling Agent
is able to produce monthly reports which track the Date of Original Issuance for
the Commission Shares related to such Free Shares, then the Free Shares shall be
allocated pursuant to clause (1)(a), (b) and (c) above.
(3) OMNIBUS SHARES:
Omnibus Shares of the Fund outstanding on any date shall be attributed to
IPSI or a Successor Distributor, as the case may be, in the same proportion that
the Commission Shares which are not Omnibus Shares of the Fund outstanding on
such date are attributed to it on such date; PROVIDED that if IPSI and its
transferees reasonably determine that the Transfer Agent is able to produce
monthly reports which track the Date of Original Issuance for the Omnibus
Shares, then the Omnibus Shares shall be allocated pursuant to clause 1(a), (b)
and (c) above.
PART II: ALLOCATION OF CDSCs AND EWCs
(1) CDSCS AND EWCS RELATED TO THE REDEMPTION OF COMMISSION SHARES OTHER
THAN OMNIBUS SHARES:
CDSCs and EWCs in respect of the redemption of Commission Shares which are
not Omnibus Shares shall be allocated to IPSI or a Successor Distributor
depending upon whether the related redeemed Commission Share is attributable to
IPSI or Successor Distributor, as the case may be, in accordance with Part I
above.
(2) CDSCS OR EWCS RELATED TO THE REDEMPTION OF OMNIBUS SHARES:
CDSCs or EWCs in respect of the redemption of Omnibus Shares shall be
allocated to IPSI or a Successor Distributor in the same proportion that CDSCs
or EWCs related to the redemption of Commission Shares are allocated to each
thereof; PROVIDED, that if IPSI and its transferees reasonably determine that
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the Transfer Agent is able to produce monthly reports which track the Date of
Original Issuance for the Omnibus Shares, then the CDSCs or EWCs in respect of
the redemption of Omnibus Shares shall be allocated among IPSI and any Successor
Distributors depending on whether the related redeemed Omnibus Share is
attributable to IPSI or a Successor Distributor, as the case may be, in
accordance with Part I above.
PART III: ALLOCATION OF DISTRIBUTION FEES
Assuming that the Distribution Fee remains constant over time and among
Funds so that Part IV hereof does not become operative:
(1) The portion of the aggregate Distribution Fees accrued in respect of
all Shares of all Funds during any calendar month allocable to IPSI or a
Successor Distributor is determined by multiplying the total of such
Distribution Fees by the following fraction:
(A + C)/2
---------
(B + D)/2
where:
A = The aggregate Net Asset Value of all Shares of all Funds attributed to
IPSI or such Successor Distributor, as the case may be, and
outstanding at the beginning of such calendar month
B = the aggregate Net Asset Value of all Shares of all Funds at the
beginning of such calendar month
C = The aggregate Net Asset Value of all Shares of all Funds attributed to
IPSI or such Successor Distributor, as the case may be, and
outstanding at the end of such calendar month
D = The aggregate Net Asset Value of all Shares of all Funds at the end of
such calendar month
(2) If IPSI reasonably determines that the Fund or its transfer agent is
able to produce automated monthly reports which allocate the average Net Asset
Value of the Commission Shares (or all Shares if available) of all Funds among
IPSI and each Successor Distributor in a manner consistent with the methodology
detailed in Part I and Part III(1) above, the portion of the Distribution Fees
accrued in respect of all such Shares of all Funds during a particular calendar
month will be allocated to IPSI or each Successor Distributor by multiplying the
total of such Distribution Fees by the following fraction:
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(A)/(B)
where:
A = Average Net Asset Value of all such Shares of all Funds for such
calendar month attributed to IPSI or such Successor Distributor, as
the case may be
B = Total average Net Asset Value of all such Shares of all Funds for such
calendar month
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PART IV: ADJUSTMENT OF IPSI'S SHARE AND SUCCESSOR DISTRIBUTORS' SHARES
If the terms of any Underwriting Agreement, any Plan, any Prospectus, the
Conduct Rules or any other applicable law change the rate at which Distribution
Fees or Service Fees are computed with reference to the Net Asset Value of
Shares of any Fund, these allocation procedures must be revised in light of such
changes in a manner which carries out the intent of these allocation procedures.
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EXHIBIT I
To Schedule A
to the Pilgrim Senior Income Fund
Underwriting Agreement
SELLING AGENTS
Xxxxxxx Xxxxx
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SCHEDULE B
NAME OF FUND
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Pilgrim senior income fund
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