Exhibit 23(m)(ii)
AMENDED AND RESTATED
DISTRIBUTION AND
SERVICE PLAN AND AGREEMENT
With
OppenheimerFunds Distributor, Inc. And
Xxxxxxxxxxx Variable Account Funds
For Service Shares Of
Xxxxxxxxxxx Balanced Fund/VA
This Amended and Restated Distribution and Service Plan and Agreement (the
"Plan") dated the 28th day of October, 2005, by and between Xxxxxxxxxxx
Variable Account Funds (the "Trust") for the account of its Xxxxxxxxxxx
Balanced Fund/VA (the "Fund") and Oppenheimerfunds Distributor, Inc. (the
"Distributor").
1. The Plan. This Plan is the Fund's written distribution and service
plan for its Service 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 compensate the Distributor for its
services in connection with the distribution of Shares, and the personal
service and maintenance of shareholder accounts ("Accounts") that hold
Service 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 "Insurance Company Recipients," as hereinafter defined, for
rendering services and for the maintenance of Accounts and for distributing
Service Shares. Such Insurance Company 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) "Insurance Company Recipient" shall mean any insurance company or
affiliate thereof or other person or entity which: (i) has rendered
assistance (whether direct, administrative, or both) in the
distribution of Shares and/or 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/or 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 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 institution as a Insurance
Company Recipient, whereupon such entity's rights as a third-party
beneficiary hereof shall terminate.
(b) "Qualified Holdings" shall mean, as to any Insurance Company
Recipient, all Shares owned beneficially or of record by: (i) such
Insurance Company Recipient, (ii) such clients of such Insurance
Company Recipient and/or accounts as to which such Insurance Company
Recipient provides administrative services and/or is a fiduciary or
custodian or co-fiduciary or co-custodian (collectively, the
"Customers"), or (iii) separate accounts created or sponsored by such
Insurance Company Recipient or its affiliate, but in no event shall any
such Shares be deemed owned by more than one Insurance Company
Recipient for purposes of this Plan. In the event that two entities
would otherwise qualify as Insurance Company Recipients as to the same
Shares, the Distributor shall determine which Insurance Company
Recipient shall be deemed the Insurance Company 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, in the amount of .0625%
(.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 (the "Service Fee"), provided, however, that the
Distributor may, in its sole discretion, reduce that payment level from
time to time. The Distributor will use such fee received from the Fund
in its entirety for payments to Insurance Company 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 two paragraphs. 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 Insurance Company Recipient.
The services to be rendered by the Distributor and Insurance
Company 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 Insurance Company
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 an Insurance Company
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, an Insurance Company Recipient may not be rendering
appropriate services, then the Distributor, at the request of the
Board, shall require the Insurance Company Recipient to provide a
written report or other information to verify that said Insurance
Company Recipient is providing appropriate services in this regard. If
the Distributor still is not satisfied, it may take appropriate steps
to terminate the Insurance Company Recipient's status as such under the
Plan, whereupon such entity's rights as a third-party beneficiary
hereunder shall terminate.
The distribution assistance 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 insurance company,
broker, dealer, bank or other person or entity that directly or
indirectly sells Shares; (ii) paying compensation to and expenses of
personnel of the Distributor who support distribution of Shares by
Insurance Company 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; and (iv) paying other
direct distribution costs, including without limitation the costs of
sales literature, advertising and prospectuses (other than those
prospectuses furnished to current direct and indirect holders of the
Fund's shares ("Shareholders")).
(b) The Distributor shall make payments to any Insurance Company
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 .0625%
(.25% on an annual basis) of the average during each 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 Insurance Company Recipient or by its Customers,
provided, however, that the Distributor may, in its sole discretion,
reduce that payment level from time to time. However, no such payments
shall be made to any Insurance Company Recipient for any such period in
which its Qualified Holdings do not equal or exceed, at the end of such
period, 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 increase or decrease and thereafter adjust the rate of fees to be
paid to the Distributor or to any Insurance Company 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 Insurance Company Recipients of the
Minimum Qualified Holdings and the rate of payments hereunder
applicable to Insurance Company Recipients, and shall provide each
Insurance Company 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 Insurance Company
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 Trust who are not "interested persons" of
the Fund or the Trust 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 Trust
shall provide at least quarterly a written report to the Trust's Board for
its review, detailing the amount of all payments made under this Plan, and
the purposes for which the payments were made. The reports shall be provided
quarterly, and shall state whether all provisions of Section 3 of this Plan
have been complied with.
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 Shares,
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 28, 2005 for the purpose of voting on this Plan and
replaces the prior Amended and Restated Distribution and Service Plan and
Agreement for the Fund's Service Shares. Unless terminated as hereinafter
provided, it shall continue in effect until renewed by the Board in
accordance with Rule 12b-1 under the 1940 Act and 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 the 0000 Xxx) of the Fund's
outstanding voting Service shares. In the event of such termination, the
Board and its Independent Trustees shall determine whether the Distributor
shall be entitled to payment from the Fund of all or a portion of the Service
Fee in respect of Shares sold prior to the effective date of such
termination. This Plan may not be amended to increase materially the amount
of payments to be made without approval of the Service 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 Trust 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 Trust and
the Fund.
Xxxxxxxxxxx Variable Account Funds
on behalf of Xxxxxxxxxxx Balanced Fund/VA
By: /s/ Xxxxxxxx X. Xxxx
Xxxxxxxx X. Xxxx, Assistant Secretary
OppenheimerFunds Distributor, Inc.
By: /s/ Xxxxx X. Xxxx
Xxxxx X. Xxxx, President
