DISTRIBUTION PLAN
UNDER RULE 12b-1
THIS DISTRIBUTION PLAN (the "Plan") under Rule 12b-1 of the Investment
Company Act of 1940 (the "1940 Act") is made as of the 8th day of February, 1993
by and between IAA TRUST GROWTH FUND, INCORPORATED (the "Fund"), a Maryland
corporation, and FUND/PLAN BROKER SERVICES, INC., (the "Distributor") a
Pennsylvania corporation.
WITNESSETH:
WHEREAS, the Fund is engaged in the business as an open end management
investment company and is registered as such under the 1940 Act; and
WHEREAS, it has been proposed the Fund make payments to the Distributor
out of the Fund's net assets for distribution services rendered to the Fund; and
WHEREAS, the Fund intends to distribute its common shares ("shares") in
accordance with Rule 12b-1 under the 1940 Act, and desires to adopt this Plan
pursuant to such Rule; and
WHEREAS, the Fund's Board of Directors, in considering whether the Fund
should adopt and implement a written plan, has evaluated such information as it
deemed necessary to an informed determination as to whether a written plan
should be adopted and implemented and has considered such pertinent factors as
it deemed necessary to form the basis for a decision to use assets of the Fund
for such purposes and has determined that there is a reasonable likelihood that
adoption and implementation of a plan will benefit the Fund and its
shareholders;
NOW, THEREFORE, the Fund hereby adopts this Plan in accordance with
Rule 12b-1- under the 1940 Act, and the parties hereto agree to the following
terms and conditions of the Plan:
1. Distribution Activities. The Fund will reimburse the Distributor for
costs and expenses incurred in connection with the distribution and marketing of
shares of the Fund and servicing of Fund shareholders. Such Distribution and
servicing costs and expenses may include (1) printing and advertising expenses;
(2) payments to employees or agents of the Distributor who engage in or support
distribution of the Fund's shares, including salary, commissions, travel and
related expenses; (3) the costs of preparing, printing and distributing
prospectuses and reports to prospective investors; (4) expenses of organizing
and conducting sales seminars; (5) expenses related to selling and servicing
efforts, including processing new account applications, transmitting customer
transaction information to the Fund's transfer agent and answering questions of
shareholders; (6) payments of fees to one or more broker-dealers (which may
include the Distributor itself), financial institutions or other industry
professionals, such as investment advisers, accountants and estate planning
firms (severally, a "Service Organization"), in respect of the average daily
value of the Fund's shares owned by shareholders for whom the Service
Organization is the dealer of
record or holder of record, or owned by shareholders with whom the Service
Organization has a servicing relationship; (7) costs and expenses incurred in
implementing and operating the Plan; and (8) such other similar services as the
Fund's Board of Directors determines to be reasonably calculated to result in
the sale of Fund shares.
2. Compensation. The Distributor will receive a fee monthly for such
costs, expenses or payments at an annual rate of up to but not more than 0.25%
of the average daily net assets of the Fund. In the event the Plan is terminated
as herein provided, the Fund shall have no liability for expenses that were not
reimbursed as of the date of termination.
3. Term and Termination.
(a) This Plan shall become effective upon approval by a vote
of at least a "majority of the outstanding voting securities
of the Fund," and upon approval by a vote of the Directors of
the Fund and of those Directors who have no direct or indirect
financial interest in the Plan or in any agreements related to
the Plan (the "disinterested directors") cast in person at a
meeting called for the purpose of voting on the Plan.
(b) This Plan shall remain in effect until February 8, 1993,
and from year to year thereafter; provided, however, that such
continuance is subject to approval annually by a vote of the
Directors of the Fund and of the disinterested directors cast
in person at a meeting called for the purpose of voting on
this Plan. If such annual approval is not obtained, the Plan
shall expire twelve (12) months after the date of the last
approval. This Plan may be amended at any time by the Board of
Directors; provided that (a) any amendment to increase
materially the amount to be spent for the services described
herein shall be effective only upon approval by a vote of a
majority of the outstanding shares of the Fund and (b) any
material amendments of this Plan shall be effective only upon
approval in the manner provided in the first sentence in this
paragraph.
(c) This Plan may be terminated at any time, without the
payment of any penalty, by vote of a majority of the
disinterested directors or by a vote of a majority of the
outstanding voting securities of the Fund, and shall
automatically terminate in the event of its assignment.
4. Reporting Requirements.
(a) the Distributor shall provide the Fund, for review by the
Fund's Board of Directors, and the Directors shall review, at
least quarterly, a written report of the amounts expended
pursuant to the Plan and the purposes for which such
expenditures were made. Such written report shall be in a form
satisfactory to the Fund and shall supply all information
necessary for the Board to discharge its responsibilities,
including its responsibilities pursuant to Rule 12b-1.
(b) The Fund or the Investment Adviser to the Fund shall, from
time to time, furnish or otherwise make available to the
Distributor such financial reports, proxy statements and other
information relating to the business and affairs of the Fund
as
the Distributor may reasonably require in order to discharge
its duties and obligations hereunder.
5. Selection and Nomination of Directors. While this Plan is in effect,
the selection and nomination of disinterested directors shall be committed to
the discretion of the Directors who are not interested persons.
6. Recordkeeping. The Fund shall preserve copies of this Plan, any
related agreements, and all reports made pursuant to Section 11 hereof for a
period of not less than six years from the date of this Plan or any such
agreement or report, as the case may be, the first two years in an easily
accessible place.
7. Non-Exclusivity Clause. Nothing herein contained shall limit the
freedom of the Distributor or an "affiliated person" of the Distributor, to act
as distributor for other persons, firms or corporations or to engage in other
business activities.
8. Limit of Liability.
(a) Neither the Distributor nor any of its employees or agents is
authorized to make any representations concerning the shares except
those contained in the then current Prospectus or Statement of
Additional Information of the Fund.
(b) The Distributor shall use its best efforts in rendering services
hereunder, but in the absence of willful misfeasance, bad faith,
negligence or reckless disregard of its obligations hereunder, the
Distributor shall not be liable to the Fund or any of its
shareholders for any error of judgment or mistake of law of for any
act or omission or for any losses sustained by the Fund or its
shareholders resulting therefrom.
(c) Nothing herein contained shall be deemed to require the Fund to
take any action contrary to its Articles of Incorporation or
By-Laws, or any applicable statutory or regulatory requirement to
which it is subject or by which is bound, or relieve or deprive the
Board of Directors of the Fund of the responsibility for and control
of the affairs of the Fund.
9. Applicable Law. The provisions hereof shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and shall be construed in accordance with the laws of the State of Maryland and
the applicable provisions of the 1940 Act. To the extent the applicable law of
the State of Maryland or any of the provisions herein conflicts with the
applicable provisions of the 1940 Act, the latter shall control.
10. Invalidity. If any provision of this Plan shall be held or made
invalid by a court decision, statute, rule or otherwise the remainder of the
Plan shall be affected thereby.
11. Definitions. For the purposes of this Plan, the terms "interested
person," "assignment," "affiliated person" and "majority of the outstanding
voting securities" are used as defined in the 1940 Act.
IN WITNESS WHEREOF, the parties hereto have caused this Plan to be
signed by the respective officers thereunto duly authorized and their respected
corporate seals to be hereunto affixed, as of the day and year first above
written.
IAA TRUST GROWTH FUND, INC.
By _________________________________________
Title
FUND/PLAN BROKER SERVICES, INC.
By _________________________________________
Title
