Exhibit (m)(5)
SHAREHOLDER SERVICES AGREEMENT
FOR CLASS A, CLASS B AND CLASS C SHARES
AGREEMENT dated this 5th day of April 2002 by and between XXXXXXX STRATEGIC
INCOME FUND, a Massachusetts business trust (the "Fund"), and XXXXXXX
DISTRIBUTORS, INC., a Delaware corporation ("SDI").
In consideration of the mutual covenants hereinafter contained, it is hereby
agreed by and between the parties hereto as follows:
1. The Fund hereby appoints SDI to provide information and administrative
services for the benefit of the Fund and shareholders of Class A, Class B and
Class C shares (each, a "Retail Class") of each series of the Fund. In this
regard, SDI shall appoint various broker-dealer firms and other financial
services or administrative firms ("Firms") to provide related services and
facilities for investors in each Retail Class of the Fund ("investors"). The
Firms shall provide such office space and equipment, telephone facilities,
personnel or other services as may be necessary or beneficial for providing
information and services to investors in each Retail Class of the Fund. Such
services and assistance may include, but are not limited to, establishing and
maintaining accounts and records, processing purchase and redemption
transactions, answering routine inquiries regarding the Fund and its special
features, assisting investors in changing dividend and investment options,
account designations and addresses, and such other administrative services as
the Fund or SDI may reasonably request. Firms may include affiliates of SDI. SDI
may also provide some of the above services for the Fund directly.
SDI accepts such appointment and agrees during the term hereof to render such
services and to assume the obligations herein set forth for the compensation
herein provided. SDI shall for all purposes herein provided be deemed to be an
independent contractor and, unless otherwise expressly provided or authorized,
shall have no authority to act for or represent the Fund in any way or otherwise
be deemed an agent of the Fund. SDI, by separate agreement with the Fund, may
also serve the Fund in other capacities. The services of SDI to the Fund under
this Agreement are not to be deemed exclusive, and SDI shall be free to render
similar services or other services to others. In carrying out its duties and
responsibilities hereunder, SDI will appoint various Firms to provide
administrative and other services described herein directly to or for the
benefit of investors in each Retail Class of the Fund. Such Firms shall at all
times be deemed to be independent contractors retained by SDI and not the Fund.
SDI and not the Fund will be responsible for the payment of compensation to such
Firms for such services.
2. For the administrative services and facilities described in Section 1, the
Fund may pay SDI any amounts authorized for payment to SDI out of the Rule 12b-1
Plan adopted by the Fund on behalf of each Retail Class (each, a "Plan"). The
current fee authorized under the Plan and the current fee schedule agreed upon
between the parties is set forth on Appendix I hereto. The administrative
service fee will be calculated separately for each Retail Class of each series
of the Fund as an expense of each such Retail Class. For the month and year in
which this Agreement
becomes effective or terminates, there shall be an appropriate proration on the
basis of the number of days that the Agreement is in effect during such month
and year, respectively.
SDI may use such payments, in its discretion, to compensate Firms who provide
administrative services to the extent permitted by the Plan. The payment of fees
pursuant to this Agreement, for each Retail Class, is subject to and contingent
upon, the continued effectiveness of a duly adopted Rule 12b-1 Plan authorizing
such payment for such class.
SDI shall be contractually bound hereunder by the terms of any publicly
announced fee cap or waiver of its fee or by the terms of any written document
provided to the Board of Trustees of the Fund announcing a fee cap or waiver of
its fee, or any limitation of the Fund's expenses, as if such fee cap, fee
waiver or expense limitation were fully set forth herein.
The net asset value for each Retail Class shall be calculated in accordance with
the provisions of the Fund's current prospectus. On each day when net asset
value is not calculated, the net asset value of a share of a Retail Class shall
be deemed to be the net asset value of such a share as of the close of business
on the last day on which such calculation was made for the purpose of the
foregoing computations.
3. The Fund shall assume and pay all charges and expenses of its operations not
specifically assumed or otherwise to be provided by SDI under this Agreement.
4. This Agreement shall become effective on the date hereof and shall continue
until September 30, 2002, and shall continue from year to year thereafter only
so long as such continuance is approved at least annually by a vote of a
majority of the trustees, including trustees who are not interested persons of
the Fund and have no direct or indirect financial interest in the operation of
the Plans, this Agreement or in any other agreement related to the Plans, at a
meeting called for such purpose.
This Agreement shall automatically terminate in the event of its assignment and
may be terminated at any time without the payment of any penalty by the Fund or
by SDI on sixty (60) days' written notice to the other party. The Fund may
effect termination with respect to any Retail Class of any series of the Fund by
a vote of (i) a majority of the Trustees of the Fund who are not interested
persons of the Fund and who have no direct or indirect financial interest in the
operation of the Plan , this Agreement or in any other agreement related to the
Plans or this Agreement or (ii) a majority of the outstanding voting securities
of such Retail Class. Without prejudice to any other remedies of the Fund, the
Fund may terminate this Agreement at any time immediately upon SDI's failure to
fulfill any of its obligations hereunder.
This Agreement may not be amended to materially increase the amount payable to
SDI by the Fund for services hereunder with respect to a Retail Class of the
Fund without a vote of a majority of the outstanding voting securities of such
class. All material amendments to this Agreement must in any event be approved
by a vote of a majority of the Board of Trustees of the Fund including the
trustees who are not interested persons of the Fund and who have no direct or
indirect financial interest in the operation of the Plans, this Agreement or in
any other agreement related to the Plans or this Agreement, cast in person at a
meeting called for such purpose.
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The terms "assignment" "interested person" and "vote of a majority of the
outstanding voting securities" shall have the meanings set forth in the
Investment Company Act of 1940, as amended (the "1940 Act") and the rules and
regulations thereunder.
5. If any provision of this Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder shall not be thereby
affected.
6. Any person authorized to direct the disposition of monies paid or payable by
the Fund pursuant to the Plans, this Agreement, or any related agreement, shall
provide to the Fund's Board of Trustees and the Trustees shall review, at least
quarterly, a written report of the amounts so expended and the purposes for
which such expenditures were made.
7. Any notice under this Agreement shall be in writing, addressed and delivered
or mailed, postage prepaid, to the other party at such address as such other
party may designate for the receipt of such notice.
8. All parties hereto are expressly put on notice of the Fund's Agreement and
Declaration of Trust and all amendments thereto, all of which are on file with
the Secretary of The Commonwealth of Massachusetts, and the limitation of
shareholder and trustee liability contained therein. This Agreement has been
executed by and on behalf of the Fund by its representatives as such
representatives and not individually, and the obligations of the Fund thereunder
are not binding upon any of the trustees, officers or shareholders of the Fund
individually but are binding upon only the assets and property of the Fund. With
respect to any claim by SDI for recovery of that portion of the administrative
services fees (or any other liability of the Fund arising hereunder) related to
a particular series and class of the Fund, whether in accordance with the
express terms hereof or otherwise, SDI shall have recourse solely against the
assets of such series and class to satisfy such claim and shall have no recourse
against the assets of any other series and class of the Fund for such purpose.
9. This Agreement shall be construed in accordance with applicable federal law
and with the laws of The Commonwealth of Massachusetts.
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IN WITNESS WHEREOF, the Fund and SDI have caused this Agreement to be executed
as of the day and year first above written.
XXXXXXX STRATEGIC INCOME FUND
By: /s/Xxxx X. Xxxxxx
------------------------------------------------
Name: Xxxx X. Xxxxxx
Title: President
XXXXXXX DISTRIBUTORS, INC.
By: /s/Xxxxxx X. Xxxxx
------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: President
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APPENDIX I
XXXXXXX STRATEGIC INCOME FUND
FEE SCHEDULE FOR SHAREHOLDER SERVICES AGREEMENT
Pursuant to Section 2 of the Shareholder Services Agreement between Xxxxxxx
Strategic Income Fund (the "Fund") and Xxxxxxx Distributors, Inc. ("SDI"), the
Fund and SDI agree that the administrative service fee will be computed at an
annual rate of .25 of 1% based upon the average daily net assets with respect to
which a Firm other than SDI provides administrative services and .15 of 1% based
upon the average daily net assets with respect to which SDI provides
administrative services.
XXXXXXX STRATEGIC INCOME FUND XXXXXXX DISTRIBUTORS, INC.
By: /s/Xxxx X. Xxxxxx By: /s/Xxxxxx X. Xxxxx
-------------------------------- -------------------------------
Name: Xxxx X. Xxxxxx Name: Xxxxxx X. Xxxxx
Title: President Title: President
Dated: April 5, 2002
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