AMENDED AND RESTATED
SERVICE PLAN AND AGREEMENT
with
OppenheimerFunds Distributor, Inc.
For Class A Shares of
Xxxxxxxxxxx Balanced Fund
This Amended and Restated SERVICE PLAN AND AGREEMENT (the "Plan") is dated as
of the 26th day of October, 2005, by and between Xxxxxxxxxxx Balanced Fund
(the "Fund") and OppenheimerFunds Distributor, Inc. (the "Distributor").
1. The Plan. This Plan is the Fund's written service plan for its Class A
Shares described in the Fund's registration statement as of the date this
Plan takes effect, contemplated by and to comply with Rule 2830 of the
Conduct Rules of the National Association of Securities Dealers, Inc.,
pursuant to which the Fund will reimburse the Distributor for a portion of
its costs incurred in connection with the personal service and maintenance of
shareholder accounts ("Accounts") that hold Class A Shares (the "Shares") of
the Fund. The Fund may be deemed to be acting as distributor of securities
of which it is the issuer, pursuant to Rule 12b-1 under the Investment
Company Act of 1940 (the "1940 Act"), according to the terms of this Plan.
The Distributor is authorized under the Plan to pay "Recipients," as
hereinafter defined, for rendering services and for the maintenance of
Accounts. Such Recipients are intended to have certain rights as third-party
beneficiaries under this Plan.
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
institution which: (i) has rendered services in connection with the
personal service and maintenance of Accounts; (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 such service; and (iii) has been selected by the
Distributor to receive payments under the Plan. Notwithstanding the
foregoing, a majority of the Fund's Board of Trustees (the "Board") who
are not "interested persons" (as defined in the 0000 Xxx) 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 institution as a
Recipient, whereupon such 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 two entities would otherwise qualify as Recipients as to the same
Shares, the Recipient which is the dealer of record on the Fund's books
shall be deemed the Recipient as to such Shares for purposes of this
Plan.
3. Payments.
(a) Under the Plan, the Fund will make payments to the Distributor,
within forty-five (45) days of the end of each calendar quarter or at
such other interval as deemed appropriate by the Distributor, in the
amount of the lesser of: (i) 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. Notwithstanding the foregoing, the Fund
will not make payments to the Distributor in excess of the amount the
Distributor pays to Recipients. The Distributor will use such fee
received from the Fund in its entirety to reimburse itself for payments
to Recipients and for its other expenditures and costs of the type
approved by the Board incurred in connection with the personal service
and maintenance of Accounts including, but not limited to, the services
described in the following paragraph. The Distributor may make Plan
payments to any "affiliated person" (as defined in the 0000 Xxx) of the
Distributor if such affiliated person qualifies as a Recipient.
The services to be rendered by the Distributor and Recipients in
connection with the personal service and the maintenance of Accounts
may include, but shall not be limited to, the following: answering
routine inquiries from the Recipient's customers concerning the Fund,
providing such customers with information on their investment in
Shares, assisting in the establishment and maintenance of accounts or
sub-accounts in the Fund, making the Fund's investment plans and
dividend payment options available, and providing such other
information and customer liaison services and the maintenance of
Accounts as the Distributor or the Fund may reasonably request. It may
be presumed that a Recipient has provided services qualifying for
compensation under the Plan if it has Qualified 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 services, 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 services in this regard. If the Distributor still is not
satisfied, it may take appropriate steps to terminate the Recipient's
status as such under the Plan, whereupon such entity's rights as a
third-party beneficiary hereunder shall terminate.
Payments received by the Distributor from the Fund under the Plan
will not be used to pay any interest expense, carrying charges or other
financial costs, or allocation of overhead by the Distributor, or for
any other purpose other than for the payments described in this Section
3. The amount payable to the Distributor each quarter or other period
will be reduced to the extent that reimbursement payments otherwise
permissible under the Plan have not been authorized by the Board for
that period. Any unreimbursed expenses incurred for any quarter by the
Distributor may not be recovered in later periods.
(b) The Distributor shall make payments to any Recipient quarterly or at
such other interval as deemed appropriate by the Distributor, within
forty-five (45) days of the end of each calendar quarter or such other
period, at a rate not to exceed 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, of Qualified
Holdings owned beneficially or of record by the Recipient or by its
Customers. However, no such payments shall be made to any Recipient
for any such period in which its Qualified Holdings do not equal or
exceed, at the end of such quarter, the minimum amount ("Minimum
Qualified Holdings"), 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 the
following service fee payments to any Recipient quarterly or at such
other interval as deemed appropriate by the Distributor, within
forty-five (45) days of the end of each calendar quarter or other such
period: (A) "Advance Service Fee Payments" at a rate not to exceed
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 (B) service fee payments at a
rate not to exceed 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. At the Distributor's sole
option, Advance Service Fee Payments may be made more often than
quarterly, and sooner than the end of the calendar quarter. In the
event Shares are redeemed less than one year after the date such Shares
were sold, the Recipient is obligated to and will repay 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.
A majority of the Independent Trustees may at any time or from
time to time increase or 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 increase or decrease the number
of shares constituting Minimum Qualified Holdings. The Distributor
shall notify all Recipients of the Minimum Qualified Holdings and the
rate of 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.
(c) Under the Plan, payments may be made to Recipients: (i) by
OppenheimerFunds, Inc. ("OFI") 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 OFI), from its own
resources.
4. Selection and Nomination of Trustees. While this Plan is in effect, the
selection or replacement of Independent Trustees and the nomination of those
persons to be Trustees of the Fund who are not "interested persons" of the
Fund shall be committed to the discretion of the Independent Trustees.
Nothing herein shall prevent the Independent 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 Independent Trustees.
5. Reports. While this Plan is in effect, the Treasurer of the Fund shall
provide at least quarterly a written report to the Fund's Board for its
review, detailing the aggregate amount of payments made pursuant to this Plan
and the purposes 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 vote of a majority of the
Independent Trustees or by a vote of the holders of a "majority" (as defined
in the 0000 Xxx) 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 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 Independent Trustees cast in person at a meeting
called on October 26, 2005 for the purpose of voting on this Plan. Unless
terminated as hereinafter provided, it shall continue in effect until renewed by
the Board in accordance with the Rule and thereafter from year to year
thereafter or as the Board may otherwise determine only so long as such
continuance is specifically approved at least annually by the Board and its
Independent Trustees by a vote cast in person at a meeting called for the
purpose of voting on such continuance. 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 the1940 Act) of the Fund's outstanding voting
securities of Class A. This Plan may not be amended to increase materially the
amount of payments to be made without approval of the Class A Shareholders, in
the manner described above, and all material amendments must be approved by a
vote of the Board and of the Independent Trustees.
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 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 Fund disclaiming
shareholder and Trustee liability for acts or obligations of the Fund.
Xxxxxxxxxxx Balanced Fund
By: /s/ Xxxxxxx X. Xxxxxxxxx
Xxxxxxx X. Xxxxxxxxx, Assistant Secretary
OppenheimerFunds Distributor, Inc.
By: /s/ Xxxxx X. Xxxx
Xxxxx X. Xxxx, President
