EXHIBIT 15 (b)
DISTRIBUTION PLAN
OF
XXXXXXX XXXXX CORPORATE BOND FUND, INC.
PURSUANT TO RULE 12b-1
DISTRIBUTION PLAN made as of the ______ day of __________, 198_ and
amended as of _____________, 1992, by and between Xxxxxxx Xxxxx Corporate Bond
Fund, Inc., a Maryland corporation (the "Fund"), and Xxxxxxx Xxxxx Funds
Distributor, Inc., a Delaware corporation ("MLFD").
W I T N E S S E T H:
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WHEREAS, the Fund intends to engage in business as an open-end
investment company registered under the Investment Company Act of 1940, as
amended (the "Investment Company Act"); and
WHEREAS, the Fund is comprised of three separate portfolios, namely, the
High Income Portfolio, the High Quality Portfolio and the Intermediate Term
Portfolio (the "Portfolios"), each of which pursues its own investment objective
through separate investment policies, and may in the future comprise one or more
additional portfolios; and
WHEREAS, MLFD is a securities firm engaged in the business of selling
shares of investment companies either directly to purchasers or through other
securities dealers; and
WHEREAS, the Fund has entered into an amended Distribution Agreement
with MLFD, pursuant to which MLFD acts as the exclusive distributor and
representative of the Fund in the offer and sale of shares of the Class B High
Income Portfolio Series Common Stock, the Class B High Quality Portfolio Series
Common Stock and the Class B Intermediate Term Portfolio Series Common Stock
(collectively, the "Class B shares") of the Fund to the public; and
WHEREAS, the Fund has adopted this Distribution Plan pursuant to Rule
12b-1 under the Investment Company Act, pursuant to which the Fund with respect
to the High Income and High Quality Portfolios will pay a distribution fee to
MLFD in connection with the distribution of Class B shares of each such
Portfolio;
WHEREAS, the Fund desires to adopt this Distribution Plan with respect
to Class B Intermediate Term Portfolio Series Common Stock; and
WHEREAS, the Directors of the Fund have determined that there is a
reasonable likelihood that adoption of this Distribution Plan will benefit the
Fund and its Class B shareholders.
Now, THEREFORE, the Fund hereby adopts, and the Distributor xxxxxx
agrees to the terms of, this Distribution Plan (the "Plan") in accordance with
Rule 12b-1 under the Investment Company Act on the following terms and
conditions:
1. The Fund shall pay MLFD a distribution fee under the Plan at the end
of each month (i) at the annual rate of .75% of the average daily net asset
value of the Class B shares of the High Income and High Quality Portfolios, and
(ii) at the annual rate of .50% of the average daily net asset value of the
Class B shares of the Intermediate Term Portfolio, to compensate MLFD and
securities firms with which MLFD enters into related agreements
("Sub-Agreements") pursuant to Paragraph 2 hereof for providing sales and
promotional activities and services. Such activities and services will relate
to the sale, promotion and marketing of the Class B shares of such Portfolios
and payments related to the furnishing of services to Class B shareholders by
sales and marketing personnel. Such expenditures may consist of sales
commissions to financial consultants for selling Class B shares of such
Portfolios, compensation, sales incentives and payments to sales and marketing
personnel, and the payment of expenses incurred in its sales and promotional
activities, including advertising expenditures related to the Class B shares of
such Portfolios, the costs of preparing and distributing promotional materials,
and the costs of providing services to Class B shareholders of a Portfolio,
including assistance in connection with inquiries related to Class B shareholder
accounts. Only distribution expenditures properly attributable to the sale of
Class B shares of a Portfolio will be used to justify any fee paid by the Fund
with respect to that Portfolio pursuant to this Plan, and, to the extent that
such expenditures relate to more than one Portfolio, the expenditures will be
allocated between the affected Portfolios in a manner deemed appropriate by the
Board of Directors of the Fund.
2. The Fund hereby authorizes MLFD to enter into Sub-Agreements with
certain securities firms ("Securities Firms"), including Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated, to provide compensation to such Securities Firms
for activities and services of the type referred to in Paragraph 1. MLFD may
reallocate all or a portion of its distribution fee to such Securities Firms as
compensation for the above-mentioned activities and services. Such Sub-Agreement
shall provide that the Securities Firms shall provide MLFD with such information
as is reasonably necessary to permit MLFD to comply with the reporting
requirements set forth in Paragraph 3 hereof.
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3. MLFD shall provide the Fund for review by the Board of Directors,
and the Directors shall review, at least quarterly, a written report complying
with the requirements of Rule 12b-1 regarding the disbursement of the
distribution fee during such period.
4. This Plan shall not take effect with respect to a Portfolio until it
has been approved by a vote of at least a majority, as defined in the Investment
Company Act, of the outstanding Class B voting securities of that Portfolio.
5. This Plan shall not take effect with respect to a Portfolio until it
has been approved, together with any related agreements with respect to that
Portfolio, by votes of a majority of both (a) the Directors of the Fund and (b)
those Directors of the Fund who are not "interested persons" of the Fund, as
defined in the Investment Company Act, and have no direct or indirect financial
interest in the operation of the Plan or any agreements related to it
(the "Rule 12b-1 Directors"), cast in person at a meeting or meetings called for
the purpose of voting on this Plan and such related agreements.
6. This Plan shall continue in effect for so long as such continuance
is specifically approved at least annually in the manner provided for approval
of this Plan in Paragraph 5.
7. This Plan may be terminated with respect to a Portfolio at any time
by vote of a majority of the Rule 12b-1 Directors or by vote of a majority of
the outstanding Class B voting securities of that Portfolio.
8. This Plan may not be amended to increase materially the rate of
distribution payments provided for in Paragraph 1 hereof unless such amendment
is approved in the manner provided for initial approval in Paragraphs 4 and 5
hereof, and no material amendment to the Plan shall be made unless approved in
the manner provided for approval and annual renewal of Paragraph 5 hereof.
9. While this Plan is in effect, the selection and nomination of
Directors who are not interested persons, as defined in the Investment Company
Act, of the Fund shall be committed to the discretion of the Directors who are
not interested persons.
10. The Fund shall preserve copies of this Plan and any related
agreements and all reports made pursuant to Paragraph 3.
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hereof, for a period of not less than six years from the date of this Plan, or
the agreements or such report, as the case may be, the first two years in an
easily accessible place.
IN WITNESS WHEREOF, the parties hereto have executed this Distribution
Plan as of , 1992.
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XXXXXXX XXXXX CORPORATE BOND FUND, INC.
By
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XXXXXXX XXXXX FUNDS DISTRIBUTOR, INC.
By
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DISTRIBUTION PLAN SUB-AGREEMENT
AGREEMENT made as of the day of , 198 and amended as of
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the day of , 1992 by and between Xxxxxxx Xxxxx Funds Distributor,
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Inc., a Delaware corporation (the "Distributor"), and Xxxxxxx Xxxxx, Xxxxxx,
Xxxxxx & Xxxxx Incorporated, a Delaware corporation (the "Securities Firm")
W I T N E S S E T H:
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WHEREAS, the Distributor has entered into an agreement with Xxxxxxx
Xxxxx Corporate Bond Fund, Inc., a Maryland corporation (the "Fund"), pursuant
to which it acts as the exclusive distributor for the sale of shares of the
Class B High Income Portfolio Series Common Stock, the Class B High Quality
Portfolio Series Common Stock and the Class B Intermediate Term Portfolio Series
Common Stock (collectively, the "Class B shares") of the Fund; and
WHEREAS, the Distributor and the Fund have entered into a Distribution
Plan (the "Plan") pursuant to Rule 12b-1 under the Investment Company Act of
1940 (the "Act") pursuant to which the Distributor receives a distribution fee
from the Fund at the annual rate of 0.75% of the average daily net asset value
of the Class B shares of the Fund's High Income Portfolio and High Quality
Portfolio and at the annual rate of .50% of the average daily net asset value of
the Class B Shares of the Fund's Intermediate Term Portfolio for providing sales
and promotional activities and services related to the distribution of Class B
shares of the Fund; and
WHEREAS, the Distributor desires the Securities Firm to perform certain
sales and promotional activities and services for the Fund's Class B
shareholders, and the Securities Firm is willing to perform such services;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereby agree as follows:
1. The Securities Firm shall provide sales and promotional activities
and services with respect to the sale of the Class B shares of the Fund, and
incur distribution expenditures, of the types referred to in Paragraph 1 of the
Plan.
2. As compensation for its services performed under this Sub-Agreement,
the Distributor shall pay the Securities Firm a fee and a distribution fee at
the end of each calendar month in an amount agreed upon by the parties hereto.
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3. The Securities Firm shall provide the Distributor, at least
quarterly, such information as reasonably requested by the Distributor to enable
the Distributor to comply with the reporting requirements of Rule 12b-1
regarding the disbursement of the fee during such period referred to in
Paragraph 3 of the Plan.
4. This Sub-Agreement shall not take effect with respect to a Portfolio
until it has been approved with respect to that Portfolio by votes of a majority
of both (a) the Directors of the Fund and (b) those Directors of the Fund who
are not "interested persons" of the Fund, as defined in the Act, and have no
direct or indirect financial interest in the operation of this Plan, or any
agreements related to it, cast in person at a meeting or meetings called for the
purpose of voting on this Agreement.
5. This Sub-Agreement shall continue in effect for as long as such
continuance is specifically approved at least annually in the manner provided
for approval of the Plan in Paragraph 5.
6. This Sub-Agreement shall automatically terminate in the event of its
assignment or in the event of the termination of the Plan or any amendment to
the Plan that requires such termination.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of , 1992.
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XXXXXXX XXXXX FUNDS DISTRIBUTOR INC.
By
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XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By
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