DISTRIBUTION AND SERVICE PLAN AND AGREEMENT
BETWEEN
OPPENHEIMERFUNDS DISTRIBUTOR, INC.
AND
XXXXXXXXXXX QUEST CAPITAL VALUE FUND, INC.
FOR CLASS A SHARES OF
XXXXXXXXXXX QUEST CAPITAL VALUE FUND, INC.
DISTRIBUTION AND SERVICE PLAN AND AGREEMENT (the "Plan") dated
the ____ day of January, 1997, by and between XXXXXXXXXXX QUEST
CAPITAL VALUE FUND, INC. (the "Fund") and OPPENHEIMERFUNDS
DISTRIBUTOR, INC. (the "Distributor").
1. The Plan. This Plan is the Fund's written distribution
plan for Class A shares of the Fund (the "Shares"), contemplated by
Rule 12b-1 (the "Rule") under the Investment Company Act of 1940
(the "1940 Act"), pursuant to which the Fund will compensate the
Distributor for its services incurred in connection with the
distribution of Shares, and the personal service and maintenance of
shareholder accounts that hold Shares ("Accounts"). The Fund may
act as distributor of securities of which it is the issuer,
pursuant to the Rule, according to the terms of this Plan. The
Distributor is authorized under the Plan to pay "Recipients," as
hereinafter defined, for rendering (1) distribution assistance in
connection with the sale of Shares and/or (2) administrative
support services with respect to Accounts. Such Recipients are
intended to have certain rights as third-party beneficiaries under
this Plan. The terms and provisions of this Plan shall be
interpreted and defined in a manner consistent with the provisions
and definitions contained in (i) the 1940 Act, (ii) the Rule, (iii)
Rule 2830 of the National Association of Securities Dealers, Inc.
Conduct Rules, or its successor (the "NASD Conduct Rules") and (iv)
any conditions pertaining either to distribution-related expenses
or to a plan of distribution, to which the Fund is subject under
any order on which the Fund relies, issued at any time by the
Securities and Exchange Commission.
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
person or entity which: (i) has rendered assistance (whether
direct, administrative or both) in the distribution of Shares or
has provided administrative support services with respect to Shares
held by Customers (defined below) of the Recipient; (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 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
Fund's Board of Directors (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 Directors") may
remove any broker, dealer, bank or other person or entity as a
Recipient, whereupon such person's or 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 customers, clients 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 for Distribution Assistance and Administrative
Support Services.
(a) The Fund will make payments to the Distributor (i) within
forty-five (45) days of the end of each calendar quarter, in the
aggregate amount of 0.0625% (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
(the "Service Fee"), plus (ii) within ten (10) days of the end of
each month, in the aggregate 0.020833% (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 (the "Asset-Based Sales Charge"). Such Service Fee payments
received from the Fund will compensate the Distributor and
Recipients for providing administrative support services with
respect to Accounts. Such Asset-Based Sales Charge payments
received from the Fund will compensate the Distributor and
Recipients for providing distribution assistance in connection with
the sale of Shares.
The administrative support services in connection with the
Accounts to be rendered by Recipients may include, but shall not be
limited to, the following: answering routine inquiries concerning
the Fund, assisting in establishing and maintaining accounts or
sub-accounts in the Fund and processing Share redemption
transactions, making the Fund's investment plans and dividend
payment options available, and providing such other information and
services in connection with the rendering of personal services
and/or the maintenance of Accounts, as the Distributor or the Fund
may reasonably request.
The distribution assistance in connection with the sale of
Shares to be rendered by the Distributor and by Recipients may
include, but shall not be limited to, the following: distributing
sales literature and prospectuses other than those furnished to
current holders of the Fund's Shares ("Shareholders"), and
providing such other information and services in connection with
the distribution of Shares as the Distributor or the Fund may
reasonably request.
It may be presumed that a Recipient has provided distribution
assistance or administrative support services qualifying for
payment 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 distribution assistance in connection
with the sale of Shares or administrative support services for the
Accounts, 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
distribution assistance and/or services in this regard. If the
Distributor or the Board of Directors still is not satisfied,
either may take appropriate steps to terminate the Recipient's
status as such under the Plan, whereupon such Recipient's rights as
a third-party beneficiary hereunder shall terminate.
(b) The Distributor shall make service fee payments to any
Recipient quarterly, within forty-five (45) days of the end of each
calendar quarter, at a rate not to exceed 0.0625% (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 the minimum period (the "Minimum Holding
Period"), if any, to be set from time to time by a majority of the
Independent Directors.
Alternatively, the Distributor may, at its sole option, make
service fee payments ("Advance Service Fee Payments") to any
Recipient quarterly, within forty-five (45) days of the end of each
calendar quarter, at a rate not to exceed (i) 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 (ii) 0.0625% (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, subject to reduction or
chargeback so that the Advance Service Fee Payments do not exceed
the limits on payments to Recipients that are, or may be, imposed
by the NASD Conduct Rules. In the event Shares are redeemed less
than one year after the date such Shares were sold, the Recipient
is obligated and will repay to 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.
The Advance Service Fee Payments described in part (i) of the
preceding sentence may, at the Distributor's sole option, be made
more often than quarterly, and sooner than the end of the calendar
quarter. In addition, the Distributor may make asset-based sales
charge payments to any Recipient quarterly, within forty-five (45)
days of the end of each calendar quarter, at a rate not to exceed
0.0625% (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 its Customers. However, no such service fee or asset-based
sales charge payments (collectively, the "Recipient Payments")
shall be made to any Recipient for any such quarter 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
Directors.
A majority of the Independent Directors may at any time or
from time to time decrease and thereafter adjust the rate of fees
to be paid to the Distributor or to any Recipient, but not to
exceed the rates set forth above, and/or direct the Distributor to
increase or decrease the Minimum Holding Period or the Minimum
Qualified Holdings. The Distributor shall notify all Recipients of
the Minimum Qualified Holdings or Minimum Holding Period, if any,
and the rates of Recipient 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. 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.
(c) The Service Fee and the Asset-Based Sales Charge on
Shares are subject to reduction or elimination of such amounts
under the limits to which the Distributor is, or may become,
subject under the NASD Conduct Rules. The distribution assistance
and administrative support 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 broker, dealer, bank or other person or entity that sells
Shares, and\or paying such persons Advance Service Fee Payments in
advance of, and\or greater than, the amount provided for in Section
3(b) of this Agreement; (ii) paying compensation to and expenses of
personnel of the Distributor who support distribution of Shares by
Recipients; (iii) obtaining financing or providing such financing
from its own resources, or from an affiliate, for interest and
other borrowing costs of the Distributor's unreimbursed expenses
incurred in rendering distribution assistance and administrative
support services to the Fund; (iv) paying other direct distribution
costs, including without limitation the costs of sales literature,
advertising and prospectuses (other than those furnished to current
Shareholders) and state "blue sky" registration expenses; and (v)
providing any service rendered by the Distributor that a Recipient
may render pursuant to part (a) of this Section 3. Such services
include distribution assistance and administrative support services
rendered in connection with Shares acquired (i) by purchase, (ii)
in exchange for shares of another investment company for which the
Distributor serves as distributor or sub-distributor, or (iii)
pursuant to a plan of reorganization to which the Fund is a party.
In the event that the Board should have reason to believe that the
Distributor may not be rendering appropriate distribution
assistance or administrative support services in connection with
the sale of Shares, then the Distributor, at the request of the
Board, shall provide the Board with a written report or other
information to verify that the Distributor is providing appropriate
services in this regard.
(d) 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, from Asset-Based Sales Charge payments or from its
borrowings.
(e) Notwithstanding any other provision of this Plan, this
Plan does not obligate or in any way make the Fund liable to make
any payment whatsoever to any person or entity other than directly
to the Distributor. In no event shall the amounts to be paid to
the Distributor exceed the rate of fees to be paid by the Fund to
the Distributor set forth in paragraph (a) of this Section 3.
4. Selection and Nomination of Directors. While this Plan
is in effect, the selection and nomination of those persons to be
Directors of the Fund who are not "interested persons" of the Fund
("Disinterested Directors") shall be committed to the discretion of
such Disinterested Directors. Nothing herein shall prevent the
Disinterested Directors 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 Disinterested Directors.
5. Reports. While this Plan is in effect, the Treasurer of
the Fund shall provide written reports to the Funds's Board for its
review, detailing services rendered in connection with the
distribution of the Shares, the amount of all payments made and the
purpose 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 a
vote of a majority of the Independent Directors 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
Directors 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
a vote of the Board and its Independent Directors 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 Board and its
Independent Directors cast in person at a meeting called on
_______, 1996 for the purpose of voting on this Plan, and shall
take effect after approval by Class A shareholders of the Fund.
Unless terminated as hereinafter provided, it shall continue in
effect from year to year from the date first set forth above or as
the Board may otherwise determine only so long as such continuance
is specifically approved at least annually by a vote of the Board
and its Independent Directors cast in person at a meeting called
for the purpose of voting on such continuance. 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 Directors. This Plan may
be terminated at any time by vote of a majority of the Independent
Directors or by the vote of the holders of a "majority" (as defined
in the 0000 Xxx) of the Fund's outstanding voting securities of the
Class. In the event of such termination, the Board and its
Independent Directors shall determine whether the Distributor is
entitled to payment from the Fund of all or a portion of the
Service Fee and/or the Asset-Based Sales Charge in respect of
Shares sold prior to the effective date of such termination.
XXXXXXXXXXX QUEST CAPITAL VALUE FUND, INC.
By: ______________________________________
Xxxxxxx X. Xxxxxxxxx, Chairman
OPPENHEIMERFUNDS DISTRIBUTOR, INC.
By:____________________________________
Xxxxxx X. Xxxxxxx
Executive Vice President
