PENNSYLVANIA DAILY MUNICIPAL INCOME FUND
Distribution and Service Plan Pursuant to Rule
12b-1 Under the Investment Company Act of 1940
The Distribution and Service Plan (the "Plan") is adopted by Pennsylvania
Daily Municipal Fund (the "Fund") in accordance with the provisions of Rule
12b-1 under the Investment Company Act of 1940 (the "Act").
The Plan
1. The Fund and Xxxxx & Xxxx Distributors, Inc. (the "Distributor"), have
entered into a Distribution Agreement, in a form satisfactory to the Fund's
Board of Trustees, under which the Distributor will act as distributor of Fund's
shares. Pursuant to the Distribution Agreement, the Distributor, as agent of the
Fund, will solicit orders for the purchase of the Fund's shares, provided that
any subscriptions and orders for the purchase of the Fund's shares will not be
binding on the Fund until accepted by the Fund as principal.
2. The Fund and the Distributor have entered into a Shareholder Servicing
Agreement with respect to the Class A shares of the Fund, in a form satisfactory
to the Fund's Board of Trustees, which provides that the Distributor will be
paid a service fee for providing or for arranging for others to provide all
personal shareholder servicing and related maintenance of
shareholder account functions not performed by us or our transfer agent.
3. The Manager may make payments from time to time from its own resources,
which may include the management fees and administrative services fees received
by the Manager from the Fund and from other companies and past profits for the
following purposes:
(i) to pay the costs of, and to compensate others, including
organizations whose customers or clients are Class A Fund shareholders
("Participating Organizations"), for performing personal shareholder
servicing and related maintanence of shareholder account functions on
behalf of the Fund;
(ii) to compensate Participating Organizations for providing
assistance in distributing the Fund's Class A shares; and
(iii) to pay the cost of the preparation and printing of brochures and
other promotional materials, mailings to prospective shareholders,
advertising, and other promotional activities, including salaries and/or
commissions of sales personnel of the Distributor and other persons, in
connection with the distribution of the Fund's shares.
The Distributor may also make payments from time to time from its own resources,
which may include the service fee and past profits for the purpose enumerated in
(i) above. Further, the Distributor may determine the amount of such payments
made
pursuant to the Plan, provided that such payments will not increase the amount
which the Fund is required to pay to (1) the Manager for any fiscal year under
the Investment Management Contract or the Administrative Services Agreement in
effect for that year or otherwise or (2) to the Distributor under the
Shareholder Servicing Agreement in effect for that year or otherwise. The
Investment Management Contract will also require the Manager to reimburse the
Fund for any amounts by which the Fund's annual operating expenses, including
distribution expenses, exceed in the aggregate in any fiscal year the limits
prescribed by any state in which the Fund's shares are qualified for sale.
4. The Fund will pay for (i) telecommunications expenses, including the
cost of dedicated lines and CRT terminals, incurred by the Distributor in
carrying out its obligations under the Shareholder Servicing Agreement with
respect to the Class A shares of the Fund and (ii) preparing, printing and
delivering the Fund's prospectus to existing shareholders of the Fund and
preparing and printing subscription application forms for shareholder accounts.
5. Payments by the Distributor or the Manager to Participating
Organizations as set forth herein are subject to compliance by them with the
terms of written agreements in a form satisfactory to the Fund's Board of
Trustees to be entered into between the Distributor and the Participating
Organizations.
6. The Fund and the Distributor will prepare and furnish to the Fund's
Board of Trustees, at least quarterly, written reports setting forth all amounts
expended for servicing and distribution purposes by the Fund, the Distributor
and the Manager, pursuant to the Plan and identifying the servicing and
distribution activities for which such expenditures were made.
7. The Plan became effective upon approval by (i) a majority of the
outstanding voting securities of the Fund (as defined in the Act), and (ii) a
majority of the Fund's Board of Trustees, including a majority of the Trustees
who are not interested persons (as defined in the Act) of the Fund and who have
no direct or indirect financial interest in the operation of the Plan or in any
agreement entered into in connection with the Plan, pursuant to a vote cast in
person at a meeting called for the purpose of voting on the approval of the
Plan.
8. The Plan will remain in effect until ______________ unless earlier
terminated in accordance with its terms, and thereafter may continue in effect
for successive annual periods if approved each year in the manner described in
clause (ii) of paragraph 6 hereof.
9. The Plan may be amended at any time with the approval of the Fund's
Board of Trustees, provided that (i) any material amendments of the terms of the
Plan will be effective only upon approval as provided in clause (ii) of
paragraph 7 hereof, and (ii) any amendment which increases materially the amount
which may be spent by the Fund pursuant to the Plan will
be effective only upon the additional approval as provided in clause (i) of
paragraph 7 hereof (with each class of the Fund voting separately).
10. The Plan may be terminated without penalty at any time (i) by a vote of
the majority of the entire Board of Trustees of the Fund and by a vote of a
majority of the Trustees of the Fund who are not interested persons (as defined
in the Act) of the Fund and who have no direct or indirect financial interest in
the operation of the Plan or in any agreement related to the Plan, or (ii) by a
vote of a majority of the outstanding voting securities of the Fund (with each
class of the Fund voting separately) (as defined in the Act).
