DISTRIBUTION AGREEMENT
BETWEEN
AIM INVESTMENT PORTFOLIOS, INC.
AND
A I M DISTRIBUTORS, INC.
CLASS B SHARES
THIS AGREEMENT made this 29th day of May, 1998, by and between AIM
Investment Portfolios, Inc. a Maryland Corporation (the "Company"), with
respect to each of the Class B shares (the "Shares") of each series of shares
of common stock set forth on Schedule A to this agreement (the "Portfolios"),
and A I M Distributors, Inc., a Delaware corporation (the "Distributor").
W I T N E S S E T H:
In consideration of the mutual covenants herein contained and other good
and valuable consideration, the receipt whereof is hereby acknowledged, the
parties hereto agree as follows:
FIRST: The Company hereby appoints the Distributor as its exclusive
agent for the sale of the Shares to the public directly and through
investment dealers in the United States and throughout the world. If
subsequent to the termination of the Distributor's services to the Company
pursuant to this Agreement, the Company retains the services of another
distributor, the distribution agreement with such distributor shall contain
provisions comparable to Clauses FOURTH and SEVENTH hereof and Exhibit A
hereto, and without limiting the generality of the foregoing, will require
such distributor to maintain and make available to the Distributor records
regarding sales, redemptions and reinvestments of Shares necessary to
implement the terms of Clauses FOURTH, SEVENTH and EIGHTH hereof.
SECOND: The Company shall not sell any Shares except through the
Distributor and under the terms and conditions set forth in paragraph FOURTH
below. Notwithstanding the provisions of the foregoing sentence, however:
(A) the Company may issue Shares to any other investment company or
personal holding company, or to the shareholders thereof, in exchange for all
or a majority of the shares or assets of any such company;
(B) the Company may issue Shares at their net asset value in
connection with certain classes of transactions or to certain classes of
persons, in accordance with Rule 22d-1 under the Investment Company Act of
1940, as amended (the "1940 Act"), provided that any such class is
specified in the then current prospectus of the applicable Shares; and
(C) the Company shall have the right to specify minimum amounts for
initial and subsequent orders for the purchase of Shares.
THIRD: The Distributor hereby accepts appointment as exclusive agent
for the sale of the Shares and agrees that it will use its best efforts to
sell such Shares; provided, however, that:
(A) the Distributor may, and when requested by the Company on behalf
of the Shares shall, suspend its efforts to effectuate such sales at any time
when, in the opinion of the Distributor or of the Company, no sales should be
made because of market or other economic considerations or abnormal
circumstances of any kind;
(B) the Company may withdraw the offering of the Shares (i) at any
time with the consent of the Distributor, or (ii) without such consent when
so required by the provisions of any statute or of any order, rule or
regulation of any governmental body having jurisdiction; and
(C) the Distributor, as agent, does not undertake to sell any
specific amount of the Shares.
FOURTH:
(A) The public offering price of the Shares shall be the net asset
value per share of the applicable Shares. Net asset value per share shall be
determined in accordance with the provisions of the then current prospectus
and statement of additional information of the applicable Portfolio. The
Distributor may establish a schedule of contingent deferred sales charges to
be imposed at the time of redemption of the Shares, and such schedule shall
be disclosed in the current prospectus of each Portfolio. Such schedule of
contingent deferred sales charges may reflect variations in or waivers of
such charges on redemptions of Shares, either generally to the public or to
any specified class of shareholders and/or in connection with any specified
class of transactions, in accordance with applicable rules and regulations
and exemptive relief granted by the Securities and Exchange Commission, and
as set forth in the Portfolios' current prospectus(es). The Distributor and
the Company shall apply any then applicable scheduled variation in or waiver
of contingent deferred sales charges uniformly to all shareholders and/or all
transactions belonging to a specified class.
(B) The Distributor may pay to investment dealers and other
financial institutions through whom Shares are sold, such sales commission as
the Distributor may specify from time to time. Payment of any such sales
commissions shall be the sole obligation of the Distributor.
(C) No provision of this Agreement shall be deemed to prohibit any
payments by the Company to the Distributor or by the Company or the
Distributor to investment dealers, financial institutions and 401(k) plan
service providers where such payments are made under a distribution plan
adopted by the Company pursuant to Rule 12b-1 under the 1940 Act.
(D) The Company shall redeem the Shares from shareholders in
accordance with the terms set forth from time to time in the current
prospectus and statement of additional information of each Portfolio. The
price to be paid to a shareholder to redeem the Shares shall be equal to the
net asset value of the Shares being redeemed ("gross redemption proceeds"),
less any applicable contingent deferred sales charge, calculated pursuant to
the then applicable schedule of contingent deferred sales charges ("net
redemption proceeds"). The Distributor shall be entitled to receive the
amount of the contingent deferred sales charge that has been subtracted from
gross redemption proceeds (the "CDSC"), provided that the Shares being
redeemed were (i) issued by a Portfolio during the term of this Agreement and
any predecessor Agreement between the Company and the Distributor or
Distributor's predecessor, GT Global, Inc. ("GT Global"), or (ii) issued by
a Portfolio during or after the term of this Agreement or any predecessor
Agreement between the Company and the Distributor or GT Global in one or a
series of free exchanges of Shares for Class B
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shares of another portfolio, which can be traced to Shares or Class B shares
of another portfolio initially issued by a Portfolio or such other portfolio
during the term of this Agreement, any predecessor Agreement or any other
distribution agreement with the Distributor or GT Global with respect to such
other portfolio (the "Distributor's Earned CDSC"). The Company shall pay
or cause the Company's transfer agent to pay the Distributor's Earned CDSC to
the Distributor on the date net redemption proceeds are payable to the
redeeming shareholder.
(E) The Distributor shall maintain adequate books and records to
identify Shares (i) issued by a Portfolio during the term of this Agreement
and any predecessor Agreement between the Company and the Distributor or GT
Global or (ii) issued by a Portfolio during or after the term of this
Agreement or any predecessor Agreement between the Company and the
Distributor or GT Global in one or a series of free exchanges of Shares for
class B shares of another portfolio, which can be traced to Shares or class B
shares of another portfolio initially issued by a Portfolio or such other
portfolio during the term of this Agreement, any predecessor Agreement or any
other distribution agreement with the Distributor or GT Global with respect
to such other portfolio and shall calculate the Distributor's Earned CDSC, if
any, with respect to such Shares, upon their redemption. The Company shall
be entitled to rely on Distributor's books, records and calculations with
respect to Distributor's Earned CDSC.
FIFTH: The Distributor shall act as an agent of the Company in
connection with the sale and redemption of Shares. Except with respect to
such sales and redemptions, the Distributor shall act as principal in all
matters relating to the promotion of the sale of Shares and shall enter into
all of its own engagements, agreements and contracts as principal on its own
account. The Distributor shall enter into agreements with investment dealers
and financial institutions selected by the Distributor, authorizing such
investment dealers and financial institutions to offer and sell the Shares to
the public upon the terms and conditions set forth therein, which shall not
be inconsistent with the provisions of this Agreement. Each agreement shall
provide that the investment dealer or financial institution shall act as a
principal, and not as an agent, of the Company.
SIXTH: The Shares shall bear:
(A) the expenses of qualification of Shares for sale in connection
with such public offerings in such states as shall be selected by the
Distributor, and of continuing the qualification therein until the
Distributor notifies the Company that it does not wish such qualification
continued; and
(B) all legal expenses in connection with the foregoing.
SEVENTH:
(A) The Distributor shall bear the expenses of printing from the
final proof and distributing the prospectuses and statements of additional
information for the Shares (including supplements thereto) relating to public
offerings made by the Company pursuant to such prospectuses (which shall not
include those prospectuses and statements of additional information, and
supplements thereto, to be distributed to existing shareholders of the
Shares), and any other promotional or sales literature used by the
Distributor or furnished by the Distributor to dealers in connection with
such public offerings, and expenses of advertising in connection with such
public offerings.
(B) Subject to the limitations, if any, of applicable law including
the NASD Conduct Rules (formerly, the NASD Rules of Fair Practice) regarding
asset-based sales charges, the Company shall pay to the Distributor as a
reimbursement for all or a portion of such expenses, or as reasonable
compensation for
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distribution of the Shares, an asset-based sales charge in an amount equal to
0.75% per annum of the average daily net asset value of the Shares of each
Portfolio from time to time (the "Distributor's 12b-1 Share"), such sales
charge to be payable pursuant to the distribution plan adopted pursuant to
Rule 12b-1 under the 1940 Act (the "Plan"). The Distributor's 12b-1 Share
shall be a percentage, which shall be recomputed periodically (but not less
than monthly) in accordance with Exhibit A to this Agreement. The
Distributor's 12b-1 Share shall accrue daily and be paid to the Distributor
as soon as practicable after the end of each calendar month within which it
accrues but in any event within 10 business days after the end of each such
calendar month (unless the Distributor shall specify a later date in written
instructions to the Company) provided, however, that any notices and
calculation required by Section EIGHTH: (B) and (C) have been received by the
Company.
(C) The Distributor shall maintain adequate books and records to permit
calculations periodically (but not less than monthly) of, and shall calculate on
a monthly basis, the Distributor's 12b-1 Share to be paid to the Distributor.
The Company shall be entitled to rely on Distributor's books, records and
calculations relating to Distributor's 12b-1 Share.
EIGHTH:
(A) The Distributor may, from time to time, assign, transfer or
pledge ("Transfer") to one or more designees (each an "Assignee"), its
rights to all or a designated portion of (i) the Distributor's 12b-1 Share
(but not the Distributor's duties and obligations pursuant hereto or pursuant
to the Plan), and (ii) the Distributor's Earned CDSC, free and clear of any
offsets or claims the Company may have against the Distributor. Each such
Assignee's ownership interest in a Transfer of a designated portion of a
Distributor's 12b-1 Share and a Distributor's Earned CDSC is hereinafter
referred to as an "Assignee's 12b-1 Portion" and an "Assignee's CDSC
Portion," respectively. A Transfer pursuant to this Section EIGHTH: (A)
shall not reduce or extinguish any claim of the Company against the
Distributor.
(B) The Distributor shall promptly notify the Company in writing of
each Transfer pursuant to Section EIGHTH: (A) by providing the Company with
the name and address of each such Assignee.
(C) The Distributor may direct the Company to pay directly to an
Assignee such Assignee's 12b-1 Portion and Assignee's CDSC Portion. In such
event, Distributor shall provide the Company with a monthly calculation of
(i) the Distributor's Earned CDSC and Distributor's 12b-1 Share and (ii) each
Assignee's 12b-1 Portion and Assignee's CDSC Portion, if any, for such month
(the "Monthly Calculation"). The Monthly Calculation shall be provided to
the Company by the Distributor promptly after the close of each month or such
other time as agreed to by the Company and the Distributor which allows
timely payment of the Distributor's 12b-1 Share and Distributor's Earned CDSC
and/or the Assignee's 12b-1 Portion and Assignee's CDSC Portion. The Company
shall not be liable for any interest on such payments occasioned by delayed
delivery of the Monthly Calculation by the Distributor. In such event
following receipt from the Distributor of (i) notice of Transfer referred to
in Section EIGHTH: (B) and (ii) each Monthly Calculation, the Company shall
make all payments directly to the Assignee or Assignees in accordance with
the information provided in such notice and Monthly Calculation, on the same
terms and conditions as if such payments were to be paid directly to the
Distributor. The Company shall be entitled to rely on Distributor's notices,
and Monthly Calculations in respect of amounts to be paid pursuant to this
Section EIGHTH: (B).
(D) Alternatively, in connection with a Transfer the Distributor may
direct the Company to pay all of such Distributor's 12b-1 Share and
Distributor's Earned CDSC from time to time to a depository or collection
agent designated by any Assignee, which depository or collection agent may be
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delegated the duty of dividing such Distributor's 12b-1 Share and
Distributor's Earned CDSC between the Assignee's 12b-1 Portion and Assignee's
CDSC Portion and the balance of the Distributor's 12b-1 Share (such balance,
when distributed to the Distributor by the depository or collection agent,
the "Distributor's 12b-1 Portion") and of the Distributor's Earned CDSC
(such balance, when distributed to the Distributor by the depository or
collection agent, the "Distributor's Earned CDSC Portion"), in which case
only the Distributor's 12b-1 Portion and Distributor's Earned CDSC Portion
may be subject to offsets or claims the Company may have against the
Distributor.
(E) The Company shall not amend the Plan to reduce the amount
payable to the Distributor or any Assignee under Section SEVENTH: (B) hereof
with respect to the Shares for any Shares which have been issued prior to the
date of such amendment.
NINTH: The Distributor will accept orders for the purchase of Shares
only to the extent of purchase orders actually received and not in excess of
such orders, and it will not avail itself of any opportunity of making a
profit by expediting or withholding orders.
TENTH:
(A) Pursuant to the Plan and this Agreement, the Distributor, as
agent, shall enter into Shareholder Service Agreements with investment
dealers, financial institutions and certain 401(K) plan service providers
(collectively "Service Providers") selected by the Distributor for the
provision of certain continuing personal services to customers of such
Service Providers who have purchased Shares. Such agreements shall authorize
Service Providers to provide continuing personal shareholder services to
their customers upon the terms and conditions set forth therein, which shall
not be inconsistent with the provisions of this Agreement. Each Shareholder
Service Agreement shall provide that the Service Provider shall act as
principal, and not as an agent of the Company.
(B) Shareholder Service Agreements may provide that the Service
Providers may receive a service fee in the amount of 0.25% of the average
daily net assets of the Shares held by customers of such Service Providers
provided that such Service Providers furnish continuing personal shareholder
services to their customers in respect of such Shares. The continuing
personal services to be rendered by Service Providers under the Shareholder
Service Agreements may include, but shall not be limited to, some or all of
the following: distributing sales literature; answering routine customer
inquiries concerning the Company; assisting customers in changing dividend
elections, options, account designations and addresses, and in enrolling in
any of several special investment plans offered in connection with the
purchase of Shares; assisting in the establishment and maintenance of or
establishing and maintaining customer accounts and records and the processing
of purchase and redemption transactions; performing subaccounting; investing
dividends and any capital gains distributions automatically in the Company's
shares; providing periodic statements showing a customer's account balance
and the integration of such statements with those of other transactions and
balances in the customer's account serviced by the Service Provider;
forwarding applicable prospectus, proxy statements, reports and notices to
customers who hold Shares and providing such other information and services
as the Company or the customers may reasonably request.
(C) The Distributor may advance service fees payable to Service
Providers pursuant to the Plan or any other distribution plan adopted by the
Company with respect to Shares of one or more of the Portfolios pursuant to
Rule 12b-1 under the 1940 Act; and thereafter the Distributor may be
reimbursed for such advances through retention of service fee payments during
the period for which the service fees were advanced.
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ELEVENTH: The Company and the Distributor shall each comply with all
applicable provisions of the 1940 Act, the Securities Act of 1933, as
amended, and of all other federal and state laws, rules and regulations
governing the issuance and sale of the Shares.
TWELFTH:
(A) In the absence of willful misfeasance, bad faith, gross
negligence or reckless disregard of obligations or duties hereunder on the
part of the Distributor, the Company shall indemnify the Distributor against
any and all claims, demands, liabilities and expenses which the Distributor
may incur under the Securities Act of 1933, or common law or otherwise,
arising out of or based upon any alleged untrue statement of a material fact
contained in any registration statement or prospectus of the Shares, or any
omission to state a material fact therein, the omission of which makes any
statement contained therein misleading, unless such statement or omission was
made in reliance upon, and in conformity with, information furnished to the
Company in connection therewith by or on behalf of the Distributor. The
Distributor shall indemnify the Company and the Shares against any and all
claims, demands, liabilities and expenses which the Company or the Shares may
incur arising out of or based upon (i) any act or deed of the Distributor or
its sales representatives which has not been authorized by the Company in its
prospectus or in this Agreement and (ii) the Company's reliance on the
Distributor's books, records, calculations and notices in Sections FOURTH:
(E), SEVENTH: (C), EIGHTH: (B), EIGHTH: (C) and EIGHTH: (D).
(B) The Distributor shall indemnify the Company and the Shares
against any and all claims, demands, liabilities and expenses which the
Company or the Shares may incur under the Securities Act of 1933, as amended,
or common law or otherwise, arising out of or based upon any alleged untrue
statement of a material fact contained in any registration statement or
prospectus of the Shares, or any omission to state a material fact therein if
such statement or omission was made in reliance upon, and in conformity with,
information furnished to the Company in connection therewith by or on behalf
of the Distributor.
(C) Notwithstanding any other provision of this Agreement, the
Distributor shall not be liable for any errors of the transfer agent(s) of
the Shares, or for any failure of any such transfer agent to perform its
duties.
THIRTEENTH: Nothing herein contained shall require the Company to take
any action contrary to any provision of its Articles of Incorporation, as
amended, or to any applicable statute or regulation.
FOURTEENTH: This Agreement shall become effective with respect to the
Shares of each Portfolio upon its approval by the Board of Directors of the
Company and by vote of a majority of the Company's Directors who are not
interested parties to this Agreement or "interested persons" (as defined in
Section 2(a)(19) of the 0000 Xxx) of any party to this Agreement cast in
person at a meeting called for such purpose, shall continue in force and
effect until two years from the date hereof, and from year to year
thereafter, provided, that such continuance is specifically approved with
respect to the Shares of each Portfolio at least annually (a)(i) by the Board
of Directors of the Company or (ii) by the vote of a majority of the
outstanding Shares of such class of such Portfolio, and (b) by vote of a
majority of the Company's Directors who are not parties to this Agreement or
"interested persons" (as defined in Section 2(a)(19) of the 0000 Xxx) of any
party to this Agreement cast in person at a meeting called for such purpose.
FIFTEENTH:
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(A) This Agreement may be terminated with respect to the Shares of
any Portfolio, at any time, without the payment of any penalty, by vote of
the Board of Directors of the Company or by vote of a majority of the
outstanding Shares of such Portfolio, or by the Distributor, on sixty (60)
days' written notice to the other party; and
(B) This Agreement shall also automatically terminate in the event
of its assignment, the term "assignment" having the meaning set forth in
Section 2(a)(4) of the 1940 Act; provided, that, subject to the provisions of
the following sentence, if this Agreement is terminated for any reason, the
obligations of the Company and the Distributor pursuant to Sections FOURTH:
(D), FOURTH: (E), SEVENTH: (B), SEVENTH: (C), EIGHTH: (A) through (E) and
TWELFTH: (A) of this Agreement will continue and survive any such
termination. Notwithstanding the foregoing, upon Complete Termination of the
Plan (as such term is defined in Section 8 of the Plan in effect at the date
of this Agreement), the obligations of the Company pursuant to the terms of
Sections SEVENTH: (B), EIGHTH: (A), EIGHTH: (C), EIGHTH: (D) and EIGHTH: (E)
(with respect to payments of Distributor's 12b-1 Share and Assignee's 12b-1
Portion) of this Agreement shall terminate. A termination of the Plan with
respect to any or all Shares of any or all Portfolios shall not affect the
obligations of the Company pursuant to Sections FOURTH: (D), EIGHTH: (A),
EIGHTH: (C), EIGHTH: (D) and EIGHTH: (E) (with respect to payments of
Distributor's Earned CDSC or Assignee's CDSC Portion) hereof or of the
obligations of the Distributor pursuant to Section FOURTH: (E) or EIGHTH: (B)
hereof.
(C) The Transfer of the Distributor's rights to Distributor's 12b-1
Share or Distributor's Earned CDSC shall not cause a termination of this
Agreement or be deemed to be an assignment for purposes of Section FIFTEENTH:
(B) above.
SIXTEENTH: Any notice under this Agreement shall be in writing,
addressed and delivered, or mailed postage prepaid, to the other party at
such address as the other party may designate for the receipt of notices.
Until further notice to the other party, the addresses of both the Company
and the Distributor shall be 00 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx. Xxxxx
00000-0000.
SEVENTEENTH: This Agreement shall be deemed to be a contract made in the
State of Delaware and governed by, construed in accordance with and enforced
pursuant to the internal laws of the State of Delaware without reference to
its conflicts of laws rules.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed in duplicate on the day and year first above written.
AIM INVESTMENT PORTFOLIOS, INC.
By:
---------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: President
Attest:
---------------------------------
Name: Xxxxxxx X. Silver
Title: Assistant Secretary
A I M DISTRIBUTORS, INC.
By:
----------------------------------
Name: Xxxxxxx X. Xxxx
Title: President
Attest:
---------------------------------
Name:
Title:
8
SCHEDULE A
TO
DISTRIBUTION AGREEMENT
OF
AIM INVESTMENT PORTFOLIOS, INC.
CLASS B SHARES
AIM Dollar Fund
9
EXHIBIT A
The Distributor's 12b-1 Share in respect of each Portfolio shall be 100
percent until such time as the Distributor shall cease to serve as exclusive
distributor of the Shares of such Portfolio and thereafter shall be a
percentage, recomputed first on the date of any termination of the
Distributor's services as exclusive distributor of Shares of any Portfolio
and thereafter periodically (but not less than monthly), representing the
percentage of Shares of such Portfolio outstanding on each such computation
date allocated to the Distributor in accordance with the following rules:
1. DEFINITIONS. For purposes of this Exhibit A defined terms
used herein shall have the meaning assigned to such terms in the Distribution
Agreement and the following terms shall have the following meanings:
"COMMISSION SHARES" shall mean shares of the Portfolio or
another portfolio the redemption of which would, in the absence of the
application of some standard waiver provision, give rise to the payment of a
CDSC and shall include Commission Shares which due to the expiration of the
CDSC period no longer bear a CDSC.
"DISTRIBUTOR" shall mean the Distributor and the
Distributor's predecessor, GT Global, Inc.
"OTHER DISTRIBUTOR" shall mean each person appointed as the
exclusive distributor for the Shares of the Portfolio after the Distributor
ceases to serve in that capacity.
2. ALLOCATION RULES. In determining the Distributor's 12b-1
Share in respect of a particular Portfolio:
(a) There shall be allocated to the Distributor and each
Other Distributor all Commission Shares of such Portfolio which were sold
while such Distributor or such Other Distributor, as the case may be, was the
exclusive distributor for the Shares of the Portfolio, determined in
accordance with the transfer records maintained for such Portfolio.
(b) REINVESTED SHARES: On the date that any Shares are
issued by a Portfolio as a result of the reinvestment of dividends or other
distributions, whether ordinary income, capital gains or exempt-interest
dividend or distributions ("Reinvested Shares"), Reinvested Shares shall be
allocated to the Distributor and each Other Distributor in a number obtained
by multiplying the total number of Reinvested Shares issued on such date by a
fraction, the numerator of which is the total number of all Shares
outstanding in such Fund as of the opening of business on such date and
allocated to the Distributor or Other Distributor as of such date of
determination pursuant to these allocation procedures and the denominator is
the total number of Shares outstanding as of the opening of business on such
date.
(c) EXCHANGE SHARES: There shall be allocated to the
Distributor and each Other Distributor, as the case may be, all Commission
Shares of such Portfolio which were issued during or after the period
referred to in (a) as a consequence of one or more free exchanges of
Commission Shares of the Portfolio or of another portfolio (other than Free
Appreciation Shares) (the "Exchange Shares"), which in accordance with the
transfer records maintained for such Portfolio can be traced to Commission
Shares of the Portfolio or another portfolio initially issued by the Company
or such other portfolio during
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the time the Distributor or such Other Distributor, as the case may be, was
the exclusive distributor for the Shares of the Portfolio or such other
portfolio.
(d) FREE APPRECIATION SHARES: Shares (other than
Exchange Shares) that were acquired by the holders of such Shares in a free
exchange of Shares of any other Portfolio, which represent the appreciated
value of the Shares of the exiting portfolio over the initial purchase price
paid for the Shares being redeemed and exchanged and for which the original
purchase date and the original purchase price are not identified on an
on-going basis, shall be allocated to the Distributor and each Other
Distributor ("Free Appreciation Shares") daily in a number obtained by
multiplying the total number of Free Appreciation Shares issued by the
exiting portfolio on such date by a fraction, the numerator of which is the
total number of all Shares outstanding as of the opening of business on such
date allocated to the Distributor or such Other Distributor as of such date
of determination pursuant to these allocation procedures and the denominator
is the total number of Shares outstanding as of the opening of business on
such date.
(e) REDEEMED SHARES: Shares (other than Reinvested
Shares and Free Appreciation Shares) that are redeemed will be allocated to
the Distributor and each Other Distributor to the extent such Share was
previously allocated to the Distributor or such Other Distributor in
accordance with the rules set forth in 2(a) or (c) above. Reinvested Shares
and Free Appreciation Shares that are redeemed will be allocated to the
Distributor and each Other Distributor daily in an amount equal to the number
of Free Appreciation Shares and Reinvested Shares of such Portfolio being
redeemed on such date, which amount is obtained by multiplying the total
number of Free Appreciation Shares and Reinvested Shares being redeemed by
such Portfolio on such date by a fraction, the numerator of which is the
total number of all Free Appreciation Shares and Reinvested Shares of such
Portfolio outstanding as of the opening of business on such date allocated to
the Distributor or to such Other Distributor as of such date of determination
and the denominator is the total number of Free Appreciation Shares and
Reinvested Shares of such Portfolio outstanding as of the opening of business
on such date.
The Fund shall use its best efforts to assure that the transfer agents
and sub-transfer agents for each Portfolio maintain the data necessary to
implement the foregoing rules. If, notwithstanding the foregoing, the
transfer agents or sub-transfer agents for such Portfolio are unable to
maintain the data necessary to implement the foregoing rules as written, and
if the Distributor shall cease to serve as exclusive distributor of the
Shares of the Portfolio, the Distributor and the Portfolio agree to negotiate
in good faith with each other, with the transfer agents and sub-transfer
agents for such Portfolio and with any third party that has obtained an
interest in the Distributor's 12b-1 Share in respect of such Portfolio with a
view to arriving at mutually satisfactory modifications to the foregoing
rules designed to accomplish substantially identical results on the basis of
data which can be made available.
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