FORM OF DISTRIBUTION PLAN
WHEREAS, Xxxxxxxxx Capital Accumulator Fund (the "Fund") is registered as
an open-end diversified management investment company under the Investment
Company Act of 1940 (the "1940 Act"); and
WHEREAS, the Fund and Franklin/Xxxxxxxxx Distributors, Inc. (the "Selling
Company"), a wholly owned subsidiary of Franklin Resources, Inc. and a
broker-dealer registered under the Securities Exchange Act of 1934, have entered
into a Distribution Agreement pursuant to which the Selling Company will act as
principal underwriter of Shares of the Fund for sale to the public; and
WHEREAS, the Board of [Directors/Trustees] of the Fund has
determined to adopt this Distribution Plan (the "Plan"), in accordance with the
requirements of the 1940 Act and has determined that there is a reasonable
likelihood that the Plan will benefit the Fund and its Shareholders.
NOW THEREFORE, the Fund hereby adopts the Plan on the following terms and
conditions:
1. The Fund will reimburse the Selling Company for costs and expenses
incurred in connection with the distribution and marketing of Shares of the
Fund. Such distribution costs and expenses may include: (1) payments to
broker-dealers who provide certain services of value to the Fund's Shareholders
(sometimes referred to as a "trail fee"); (2) expenses relating to selling and
servicing efforts; (3) expenses of organizing and conducting sales seminars; (4)
payments to employees or agents of the Selling Company who engage in or support
distribution of Shares; (5) the costs of preparing, printing and distributing
prospectuses and reports to prospective investors; (6) printing and advertising
expenses; (7) dealer commission and wholesaler compensation in connection with
sales of Fund Shares exceeding $1 million; and (8) such other similar services
as the Fund's Board of [Directors/Trustees] determines to be reasonably
calculated to result in the sale of Shares.
The Selling Company will be reimbursed for such costs, expenses or payments
on a monthly basis, subject to an annual limit of 0.30% of the Fund's average
daily net assets. Payments made out of or charged against the assets of the Fund
must be in reimbursement for costs and expenses in connection with any activity
which is primarily intended to result in the sale of Fund Shares. The costs and
expenses not reimbursed in any one given month (including costs and expenses not
reimbursed because they exceeded the limit of 0.30% per annum of the Fund's
average daily net assets) may be reimbursed in subsequent months or years.
2. The Plan shall not take effect with respect to the Fund until it has
been approved by a vote of at least a majority (as defined in the 1940 Act) of
the outstanding voting Shares of the Fund. With respect to the submission of the
Plan for such a vote, it shall have been effectively approved with respect to
the Fund if a majority of the outstanding voting Shares of the Fund votes for
approval of the Plan.
3. The Plan shall not take effect until it has been approved, together with
any related agreements and supplements, by votes of a majority of both (a) the
Board of [Directors/Trustees] of the Fund, and (b) those [Directors/Trustees] of
the Fund who are not "interested persons" (as defined in the 1940 Act) and have
no direct or indirect financial interest in the operation of the Plan or any
agreements related to it (the "Plan [Directors/Trustees]"), cast in person at a
meeting (or meetings) called for the purpose of voting on the Plan and such
related agreements.
4. The Plan shall continue in effect so long as such continuance is
specifically approved at least annually in the manner provided for approval of
the Plan in paragraph 3.
5. Any person authorized to direct the disposition of monies
paid or payable by the Fund pursuant to the Plan or any related agreement shall
provide to the Fund's Board of [Directors/Trustees], and the Board shall review,
at least quarterly, a written report of the amounts so expended and the purposes
for which such expenditures were made.
6. Any agreement related to the Plan shall be in writing and
shall provide: (a) that such agreement may be terminated at any time as to the
Fund, without payment of any penalty, by vote of a majority of the Plan
[Directors/Trustees] or by vote of a majority of the outstanding voting Shares
of the Fund, on not more than sixty days' written notice to any other party to
the agreement; and (b) that such agreement shall terminate automatically in the
event of its assignment.
7. The Plan may be terminated at any time with respect to the Fund, without
payment of any penalty, by vote of a majority of the Plan [Directors/Trustees],
or by vote of a majority of the outstanding voting Shares of the Fund.
8. The Plan may be amended at any time with respect to the Fund by the
Fund's Board of [Directors/Trustees], provided that (a) any amendment to
increase materially the costs which the Fund may bear for distribution pursuant
to the Plan shall be effective only upon approval by a vote of a majority of the
outstanding voting Shares of the Fund, and (b) any material amendments of the
terms of the Plan shall become effective only upon approval as provided in
paragraph 3 hereof.
9. While the Plan is in effect, the selection and nomination of
[Directors/Trustees] who are not "interested persons" (as defined in the 1940
Act) of the Fund shall be committed to the discretion of the
[Directors/Trustees] who are not interested persons.
10. The Fund shall preserve copies of the Plan, any related agreement and
any report made pursuant to paragraph 5 hereof, for a period of not less than
six years from the date of the Plan, such agreement or report, as the case may
be, the first two years of which shall be in an easily accessible place.
11. It is understood and expressly stipulated that neither the holders of
Shares of the Fund nor any [Director/Trustee], officer, agent or employee of the
Fund shall be personally liable hereunder, nor shall any resort be had to other
private property for the satisfaction of any claim or obligation hereunder, but
the Fund only shall be liable.
IN WITNESS WHEREOF, the Fund has executed this Distribution Plan on this
___ day of _____, 2000.
XXXXXXXXX CAPITAL ACCUMULATOR FUND
By:_______________________________
Attest:
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Xxxxxxx X. Xxxxx
Secretary
