EXHIBIT 15 (d)
DISTRIBUTION AND SERVICE PLAN AND AGREEMENT
WITH
OPPENHEIMERFUNDS DISTRIBUTOR, INC.
FOR CLASS M SHARES OF
BOND FUND SERIES
XXXXXXXXXXX BOND FUND FOR GROWTH
DISTRIBUTION AND SERVICE PLAN AND AGREEMENT (the "Plan") dated as of March 11,
1996 by and between BOND FUND SERIES (the "Trust"), on behalf of XXXXXXXXXXX
BOND FUND FOR GROWTH (the "Fund"), and OPPENHEIMERFUNDS DISTRIBUTOR, INC. (the
"Distributor").
1. The Plan. This Plan is the Fund's written distribution and service plan for
Class M shares of the Fund which, prior to March 11, 1996 were designated as
Class A shares of the Fund, (the "Shares"). This Plan is contemplated by Rule
12b-l (the "Rule") under the Investment Company Act of 1940 (the "1940 Act"),
pursuant to which the Fund will reimburse the Distributor for a portion of its
costs incurred in connection with the distribution of Shares, and the personal
service and maintenance of shareholder accounts that hold Shares ("Accounts").
The Fund may act as distributor of securities of which it is the issuer,
pursuant to the Rule, according to the terms of this Plan. The Distributor is
authorized under the Plan to pay "Recipients," as hereinafter defined, for
rendering (1) distribution assistance in connection with the sale of Shares
and/or (2) administrative support services with respect to Accounts. Such
Recipients are intended to have certain rights as third-party beneficiaries
under this Plan. The terms and provisions of this Plan shall be interpreted and
defined in a manner consistent with the provisions and definitions contained in
(i) the 1940 Act, (ii) the Rule, (iii) Article III, Section 26, of the Rules of
Fair Practice of the National Association of Securities Dealers, Inc., or its
successor (the "NASD Rules of Fair Practice") and (iv) any conditions pertaining
either to distribution-related expenses or to a plan of distribution, to which
the Fund is subject under any order on which the Fund relies, issued at any time
by the Securities and Exchange Commission.
2. Definitions. As used in this Plan, the following terms shall have the
following meanings:
(a) "Recipient" shall mean any broker, dealer, bank or other person or
entity which: (i) has rendered assistance (whether direct, administrative
or both) in the distribution of Shares or has provided administrative
support services with respect to Shares held by Customers (defined below)
of the Recipient; (ii) shall furnish the Distributor (on behalf of the
Fund) with such information as the Distributor shall reasonably request to
answer such questions as may arise concerning the sale of Shares; and (iii)
has been selected by the Distributor to receive payments under the Plan.
Notwithstanding the foregoing, a majority of the Trust's Board of Trustees
(the "Board") who are not "interested persons" (as defined in the 1940 Act)
and who have no direct or indirect financial interest in the operation of
this Plan or in any agreements relating to this Plan (the "Independent
Trustees") may remove any broker,
dealer, bank or other person or entity as a Recipient, whereupon such
person's or entity's rights as a third-party beneficiary hereof shall
terminate.
(b) "Qualified Holdings" shall mean, as to any Recipient, all Shares owned
beneficially or of record by: (i) such Recipient, or (ii) such brokerage or
other customers, or investment advisory or other clients of such Recipient
and/or accounts as to which such Recipient is a fiduciary or custodian or
co-fiduciary or co-custodian (collectively, the "Customers"), but in no
event shall any such Shares be deemed owned by more than one Recipient for
purposes of this Plan. In the event that more than one person or entity
would otherwise qualify as Recipients as to the same Shares, the Recipient
which is the dealer of record on the Fund's books as determined by the
Distributor shall be deemed the Recipient as to such Shares for purposes of
this Plan.
3. Payments for Distribution Assistance and Administrative Support Services.
(a) The Fund will make payments to the Distributor, (i) within forty-five
(45) days of the end of each calendar quarter, in an amount which shall be
the lesser of 0.0625% (0.25% on an annual basis) of the average during the
calendar quarter of the aggregate net asset value of the Shares computed as
of the close of each business day or (ii) the Distributor's actual expenses
under the Plan for that quarter of the type approved by the Board (the
"Service Fee"), plus (ii) within ten (10) days of the end of each month, in
the aggregate amount of 0.0417% (0.50% on an annual basis) of the average
during the month of the aggregate net asset value of Shares computed as of
the close of each business day (the "Asset-Based Sales Charge") outstanding
for six years or less (the "Maximum Holding Period"). Such Service Fee
payments received from the Fund will compensate the Distributor and
Recipients for providing administrative support services with respect to
Accounts. Such Asset-Based Sales Charge payments received from the Fund
will compensate the Distributor and Recipients for providing distribution
assistance in connection with the sale of Shares.
The administrative support services in connection with the Accounts to be
rendered by Recipients may include, but shall not be limited to, the following:
answering routine inquiries concerning the Fund, assisting in the establishment
and maintenance of accounts or sub-accounts in the Fund and processing Share
redemption transactions, making the Fund's investment plans and dividend payment
options available, and providing such other information and services in
connection with the rendering of personal services and/or the maintenance of
Accounts, as the Distributor or the Fund may reasonably request.
The distribution assistance in connection with the sale of Shares to be
rendered by the Distributor and Recipients may include, but shall not be limited
to, the following: distributing sales literature and prospectuses other than
those furnished to current holders of the Fund's Shares ("Shareholders"), and
providing such other information and services in connection with the
distribution of Shares as the Distributor or the Fund may reasonably request.
It may be presumed that a Recipient has provided distribution assistance or
administrative support services qualifying for payment under the Plan if it has
Qualified
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Holdings of Shares to entitle it to payments under the Plan. In the event that
either the Distributor or the Board should have reason to believe that,
notwithstanding the level of Qualified Holdings, a Recipient may not be
rendering appropriate distribution assistance in connection with the sale of
Shares or administrative support services for Accounts, then the Distributor, at
the request of the Board, shall require the Recipient to provide a written
report or other information to verify that said Recipient is providing
appropriate distribution assistance and/or services in this regard. If the
Distributor or the Board of Trustees still is not satisfied, either may take
appropriate steps to terminate the Recipient's status as such under the Plan,
whereupon such Recipient's rights as a third-party beneficiary hereunder shall
terminate.
(b) The Distributor shall make service fee payments to any Recipient
quarterly, within forty-five (45) days of the end of each calendar quarter,
at a rate not to exceed 0.0625% (0.25 % on an annual basis) of the average
during the calendar quarter of the aggregate net asset value of Shares
computed as of the close of each business day, constituting Qualified
Holdings owned beneficially or of record by the Recipient or by its
Customers for a period of more than the minimum period (the "Minimum
Holding Period"), if any, to be set from time to time by a majority of the
Independent Trustees.
Alternatively, the Distributor may, at its sole option, make service fee
payments ("Advance Service Fee Payments") to any Recipient quarterly, within
forty-five (45) days of the end of each calendar quarter, at a rate not to
exceed (i) 0.25% of the average during the calendar quarter of the aggregate
net asset value of Shares, computed as of the close of business on the day such
Shares are sold, constituting Qualified Holdings sold by the Recipient during
that quarter and owned beneficially or of record by the Recipient or by its
Customers, plus (ii) 0.0625% (0.25% on an annual basis) of the average during
the calendar quarter of the aggregate net asset value of Shares computed as of
the close of each business day, constituting Qualified Holdings owned
beneficially or of record by the Recipient or by its Customers for a period of
more than one (1) year, subject to reduction or chargeback so that the Advance
Service Fee Payments do not exceed the limits on payments to Recipients that
are, or may be, imposed by Article III, Section 26, of the NASD Rules of Fair
Practice. In the event Shares are redeemed less than one year after the date
such Shares were sold, the Recipient is obligated and will repay to the
Distributor on demand a pro rata portion of such Advance Service Fee Payments,
based on the ratio of the time such shares were held to one (1) year.
The Advance Service Fee Payments described in part (i) of this paragraph
(b) may, at the Distributor's sole option, be made more often than quarterly,
and sooner than the end of the calendar quarter. In addition, the Distributor
may make asset-based sales charge payments to any Recipient quarterly, within
forty-five (45) days of the end of each calendar quarter, at a rate not to
exceed 0.125% (0.50% on an annual basis) of the average during the calendar
quarter of the aggregate net asset value of Shares computed as of the close of
each business day, constituting Qualified Holdings owned beneficially or of
record by the Recipient or by its Customers. However, no such service fee or
asset-based sales charge payments (collectively, the "Recipient Payments") shall
be made to any Recipient for any such quarter in which its Qualified Holdings do
not equal or exceed, at the end of such
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quarter, the minimum amount ("Minimum Qualified Holdings"), if any, to be set
from time to time by a majority of the Independent Trustees.
A majority of the Independent Trustees may at any time or from time to time
decrease and thereafter adjust the rate of fees to be paid to the Distributor or
to any Recipient, but not to exceed the rate set forth above, and/or direct the
Distributor to increase or decrease the Minimum Holding Period or the Minimum
Qualified Holdings. The Distributor shall notify all Recipients of the Minimum
Qualified Holdings, Maximum Holding Period and Minimum Holding Period, if any,
and the rates of Recipient Payments hereunder applicable to Recipients, and
shall provide each Recipient with written notice within thirty (30) days after
any change in these provisions. Inclusion of such provisions or a change in such
provisions in a revised current prospectus shall constitute sufficient notice.
The Distributor may make Plan payments to any "affiliated person" (as defined in
the 1940 Act) of the Distributor if such affiliated person qualifies as a
Recipient.
(c) The Service Fee and the Asset-Based Sales Charge on Shares are subject
to reduction or elimination of such amounts under the limits to which the
Distributor is, or may become, subject under Article III, Section 26, of
the NASD Rules of Fair Practice. The distribution assistance and
administrative support services to be rendered by the Distributor in
connection with the Shares may include, but shall not be limited to, the
following: (i) paying sales commissions to any broker, dealer, bank or
other person or entity that sells Shares, and\or paying such persons
Advance Service Fee Payments in advance of, and\or greater than, the amount
provided for in Section 3(b) of this Agreement; (ii) paying compensation to
and expenses of personnel of the Distributor who support distribution of
Shares by Recipients; (iii) obtaining financing or providing such financing
from its own resources, or from an affiliate, for the interest and other
borrowing costs of the Distributor's unreimbursed expenses incurred in
rendering distribution assistance and administrative support services to
the Fund; (iv) paying other direct distribution costs, including without
limitation the costs of sales literature, advertising and prospectuses
(other than those furnished to current Shareholders) and state "blue sky"
registration expenses; and (v) any service rendered by the Distributor that
a Recipient may render pursuant to part (a) of this Section 3. Such
services include distribution assistance and administrative support
services rendered in connection with Shares acquired (i) by purchase, (ii)
in exchange for shares of another investment company for which the
Distributor serves as distributor or sub-distributor, or (ii) pursuant to a
plan of reorganization to which the Fund is a party. In the event that the
Board should have reason to believe that the Distributor may not be
rendering appropriate distribution assistance or administrative support
services in connection with the sale of Shares, then the Distributor, at
the request of the Board, shall provide the Board with a written report or
other information to verify that the Distributor is providing appropriate
services in this regard.
(d) Under the Plan, payments may be made to Recipients: (i) by
OppenheimerFunds, Inc. ("Manager") from its own resources (which may
include profits derived from the advisory fee it receives from the Fund),
or (ii) by the Distributor (a subsidiary of the Manager), from its own
resources, from Asset-Based Sales Charge payments or from its borrowings.
(e) Notwithstanding any other provision of this Plan, this Plan does not
obligate or in any
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way make the Fund liable to make any payment whatsoever to any person or
entity other than directly to the Distributor. In no event shall the
amounts to be paid to the Distributor exceed the rate of fees to be paid by
the Fund to the Distributor set forth in paragraph (a) of this section 3.
4. Selection and Nomination of Trustees. While this Plan is in effect, the
selection and nomination of those persons to be Trustees of the Trust who are
not "interested persons" of the Trust ("Disinterested Trustees") shall be
committed to the discretion of such Disinterested Trustees. Nothing herein shall
prevent the Disinterested Trustees from soliciting the views or the involvement
of others in such selection or nomination if the final decision on any such
selection and nomination is approved by a majority of the incumbent
Disinterested Trustees.
5. Reports. While this Plan is in effect, the Treasurer of the Trust shall
provide at least quarterly written reports to the Fund's Board for its review,
detailing, the amount of all payments made pursuant to this Plan, the identity
of the Recipient of each such payment, and the purpose for which the payments
were made. The report shall state whether all provisions of Section 3 of this
Plan have been complied with. The Distributor shall annually certify to the
Board the amount of its total expenses incurred that year with respect to the
personal service and maintenance of Accounts in conjunction with the Board's
annual review of the continuation of the Plan.
6. Related Agreements. Any agreement related to this Plan shall be in writing
and shall provide that: (i) such agreement may be terminated at any time,
without payment of any penalty, by a vote of a majority of the Independent
Trustees or by a vote of the holders of a "majority" (as defined in the 1940
Act) of the Fund's outstanding voting securities of the Class, on not more than
sixty days written notice to any other party to the agreement; (ii) such
agreement shall automatically terminate in the event of its assignment (as
defined in the 1940 Act); (iii) it shall go into effect when approved by a vote
of the Board and its Independent Trustees cast in person at a meeting called for
the purpose of voting on such agreement; and (iv) it shall, unless terminated as
herein provided, continue in effect from year to year only so long as such
continuance is specifically approved at least annually by a vote of the Board
and its Independent Trustees cast in person at a meeting called for the purpose
of voting on such continuance.
7. Effectiveness, Continuation, Termination and Amendment. This Plan has been
approved by a vote of the Board and its Independent Trustees cast in person at a
meeting called on October 16, 1995, for the purpose of voting on this Plan and
by Class A shareholders of the Fund (who, as of March 11, 1996 has been
redesignated Class M shareholders of the Fund) at a meeting held on December 20,
1995. On March 8, 1996, this Plan shall replace the Fund's Distribution and
Service Plan and Agreement for the Class A Shares adopted June 3, 1986, and
amended May 1, 1993, July 22, 1993, October 20, 1994 and January 26, 1995.
Unless terminated as hereinafter provided, it shall continue in effect from year
to year from the date first set forth above or as the Board may otherwise
determine only so long as such continuance is specifically approved at least
annually by a vote of the Board and its Independent Trustees cast in person at a
meeting called for the purpose of voting on such continuance. This Plan may not
be amended to increase materially the amount of payments to be made without
approval of the Class M Shareholders, in the manner described above, and all
material amendments must be approved by a vote of the Board and of the
Independent Trustees. This Plan may be terminated at any time by vote of a
majority of the Independent Trustees or by the vote of the holders of a
"majority" (as defined in the 1940 Act) of the Fund's outstanding voting
securities of the Class.
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8. Disclaimer of Shareholder and Trustee Liability. The Distributor understands
that the obligations of the Fund under this Plan are not binding upon any
Trustee of the Trust or shareholder of the Fund personally, but bind only the
Fund and the Fund's property. The Distributor represents that it has notice of
the provisions of the Declaration of Trust of the Trust disclaiming shareholder
and Trustee liability for acts or obligations of the Fund.
BOND FUND SERIES, on behalf of
XXXXXXXXXXX BOND FUND FOR GROWTH
By:
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Xxxxxxx X. Xxxxx, Vice President
OPPENHEIMERFUNDS DISTRIBUTOR, INC.
By:
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Xxxxxx X. Xxxxxxx, Executive Vice President
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