XXXXXX CAPITAL APPRECIATION FUND
CLASS C
DISTRIBUTION PLAN AND AGREEMENT
This Plan and Agreement (the "Plan") constitutes the Distribution Plan for
the Class C shares of Putnam Capital Appreciation Fund, a Massachusetts
business trust (the "Trust"), adopted pursuant to the provisions of Rule
12b-1 under the Investment Company Act of 1940 (the "Act") and the related
agreement between the Trust and Xxxxxx Mutual Funds Corp. ("PMF"). During
the effective term of this Plan, the Trust may incur expenses primarily
intended to result in the sale of its Class C shares upon the terms and
conditions hereinafter set forth:
Section 1. The Trust shall pay to PMF a monthly fee at the annual rate of
1.00% of the average net asset value of the Class C shares of the Trust, as
determined at the close of each business day during the month, to
compensate PMF for services provided and expenses incurred by it in
connection with the offering of the Trust's Class C shares, which may
include, without limitation, the payment by PMF to investment dealers of
commissions on the sale of Class C shares, as set forth in the then current
Prospectus or Statement of Additional Information of the Trust and the
payment of a service fee of up to 0.25% of such net asset value for the
purposes of maintaining or improving services provided to shareholders by
PMF and investment dealers. Such fees shall be payable for each month
within 15 days after the close of such month. A majority of the Qualified
Trustees, as defined below, may, from time to time, reduce the amount of
such payments, or may suspend the operation of the Plan for such period or
periods of time as they may determine.
Section 2. This Plan shall not take effect until:
(a) it has been approved by a vote of a majority of the outstanding Class C
shares of the Trust;
(b) it has been approved, together with any related agreements, by votes of
the majority (or whatever greater percentage may, from time to time, be
required by Section 12(b) of the Act or the rules and regulations
thereunder) of both (i) the Trustees of the Trust, and (ii) the Qualified
Trustees of the Trust, cast in person at a meeting called for the purpose
of voting on this Plan or such agreement; and
(c) the Trust has received the proceeds of the initial public offering of
its Class C shares.
Section 3. This Plan shall continue in effect for a period of more than
one year after it takes effect only so long as such continuance is
specifically approved at least annually in the manner provided for approval
of this Plan in Section 2(b).
Section 4. PMF shall provide to the Trustees of the Trust, and the
Trustees shall review, at least quarterly, a written report of the amounts
so expended and the purposes for which such expenditures were made.
Section 5. This Plan may be terminated at any time by vote of a majority
of the Qualified Trustees or by vote of the majority of the outstanding
Class C shares of the Trust.
Section 6. All agreements with any person relating to implementation of
this Plan shall be in writing, and any agreement related to this Plan shall
provide:
(a) that such agreement may be terminated at any time, without payment of
any penalty, by vote of a majority of the Qualified Trustees or by vote of
a majority of the outstanding Class C shares of the Trust, on not more than
60 days' written notice to any other party to the agreement; and
(b) that such agreement shall terminate automatically in the event of its
assignment.
Section 7. This Plan may not be amended to increase materially the amount
of distribution expenses permitted pursuant to Section 1 hereof without the
approval of a majority of the outstanding Class C shares of the Trust and
all material amendments to this Plan shall be approved in the manner
provided for approval of this Plan in Section 2(b).
Section 8. As used in this Plan, (a) the term "Qualified Trustees" shall
mean those Trustees of the Trust who are not interested persons of the
Trust, and have no direct or indirect financial interest in the operation
of this Plan or any agreements related to it, and (b) the term "majority of
the outstanding Class C shares of the Trust" means the affirmative vote, at
a duly called and held meeting of Class C shareholders of the Trust, (i) of
the holders of 67% or more of the Class C shares of the Trust present (in
person or by proxy) and entitled to vote at such meeting, if the holders of
more than 50% of the outstanding Class C shares of the Trust entitled to
vote at such meeting are present in person or by proxy, or (ii) of the
holders of more than 50% of the outstanding Class C shares of the Trust
entitled to vote at such meeting, whichever is less, and (c) the terms
"assignment" and "interested person" shall have the respective meanings
specified in the Act and the rules and regulations thereunder, subject to
such exemptions as may be granted by the Securities and Exchange
Commission.
Section 9. A copy of the Agreement and Declaration of Trust of the Trust
is on file with the Secretary of State of The Commonwealth of Massachusetts
and notice is hereby given that this instrument is executed on behalf of
the Trustees of the Trust as Trustees and not individually, and that the
obligations of or arising out of this instrument are not binding upon any
of the Trustees, officers or shareholders individually but are binding only
upon the assets and property of the Trust.
Executed as of July 14, 2000
XXXXXX RETAIL MANAGEMENT, INC. XXXXXX CAPITAL APPRECIATION FUND
/S/ Xxxxxxx X. Xxxxxxxx /S/ Xxxxxxx X. Xxxxxx
By:----------------------- By:-----------------------
Xxxxxxx X. Xxxxxxxx Xxxxxxx X. Xxxxxx
President Executive Vice President
