EX-99.B(o)wrmcp
W&R FUNDS, INC.
(formerly, Waddell & Reed Funds, Inc.)
MULTIPLE CLASS PLAN PURSUANT TO RULE 18f-3
This Multiple Class Plan ("Plan") pursuant to Rule 18f-3 under the
Investment Company Act of 1940, as amended ("1940 Act"), sets forth the
multiple class structure for each Fund ("Fund") comprising W&R Funds, Inc.
A multiple class structure was approved by the Board of Directors of W&R
Funds, Inc. on February 8, 1995, under an order of exemption issued by the
Securities and Exchange Commission. Thereafter, Rule 18f-3 under the 1940
Act was adopted, and each Fund determined to operate under Rule 18f-3 and
adopted this Plan pursuant to Rule 18f-3. This Plan, as amended, describes
the classes of shares of stock of each Fund offered to the public.
General Description of the Classes:
Class A Shares. Class A shares will be sold to the general public
subject to an initial sales charge. The maximum sales charge is 5.75% of
the amount invested and declines to 0% based on discounts for volume
purchases. The initial sales charge is waived for certain eligible
purchasers.
Class A shares also will be subject to distribution and service fees
charged pursuant to a Distribution and Service Plan adopted pursuant to
Rule 12b-1 under the 1940 Act ("Rule 12b-1") that provides for a maximum
fee of .25% of the average annual net assets of the Class A shares of the
Fund.
Class B Shares. Class B shares will be sold subject to a contingent
deferred sales charge, which will be imposed on redemption proceeds. The
maximum contingent deferred sales charge will be 5.0% and will decline 1%
per year after the first year after investment to 0% after seven years, as
follows: in the first year, the contingent deferred sales charge will be
5%; in the second year, 4%; in the third and fourth years, 3%; in the fifth
year, 2%; in the sixth year, 1%; and in the seventh year, 0%. A year is a
12-month period. Solely for the purposes of determining the number of
months or years from the time of any payment for the purchase of shares,
all payments during a nomth are totaled and deemed to have been made on the
first day of the month. Class B shares will also be subject to
distribution and service fees charged pursuant to a Distribution and
Service Plan adopted pursuant to Rule 12b-1 that provides for a maximum
service fee of 0.25% and a maximum distribution fee of 0.75% of the average
annual net assets of the Class B shares of the Fund. Class B shares
convert automatically into Class A shares eight years after the end of the
month in which the shares were purchased.
Class C Shares. Class C shares will be sold without an initial sales
charge and will be subject to a contingent deferred sales charge of 1% if
the shares are redeemed within twelve months of purchase. Class C shares
will be subject to distribution and service fees charged pursuant to a
Distribution and Service Plan adopted pursuant to Rule 12b-1 that provides
for a maximum service fee of 0.25% and a maximum distribution fee of 0.75%
of the average annual net assets of the Class C shares of the Fund.
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Class Y Shares. Class Y shares will be sold without an initial sales
charge and will not be subject to a contingent deferred sales charge.
Class Y shares will be subject to a maximum Rule 12b-1 fee of 0.25% of the
average annual net assets of the Class Y shares of the Fund. Class Y
shares are designed for institutional investors and will be available for
purchase by: (i) participants of employee benefit plans established under
section 403(b) or section 457, or qualified under section 401, including
401(k) plans, of the Internal Revenue Code of 1986, as amended, when the
plan has 100 or more eligible employees and an unaffiliated third party
provides certain administrative, distribution and/or other support services
to the plan and the plan holds the shares in an omnibus account on the
Fund's records; (ii) banks, trust institutions, investment fund
administrators and other third parties investing for their own accounts or
for the accounts of their customers where such investments for customer
accounts are held in an omnibus account on the Fund's records and to which
entity an unaffiliated third party provides certain administrative
distribution and/or other support services; (iii) government entities or
authorities and corporations where the investment is $10 million or more.
Expense Allocations of Each Class:
In addition to the difference with respect to 12b-1 fees, Class A,
Class B and Class C shares differ from Class Y shares of a Fund with
respect to the applicable shareholder servicing fees. Class A, Class B and
Class C shares, respectively, pay a monthly shareholder servicing fee of
$1.3125 for each shareholder account which was in existence during the
prior month, plus $0.30 for each shareholder account on which a dividend or
distribution had a record date in that month. Class A, Class B and Class C
shares of Money Market Fund pay a monthly shareholder servicing fee of
$1.75 for each shareholder account that was in existence during the prior
month plus, for Class A shareholder accounts, $0.75 for each shareholder
check processed in the prior month. Class Y shares pay a monthly
shareholder servicing fee equal to one-twelfth of .15 of 1% of the average
daily net Class Y assets for the preceding month.
Each Class may also pay a different amount of the following other
expenses:
(a) stationery, printing, postage and delivery expenses related
to preparing and distributing materials such as shareholder reports,
prospectuses, and proxy statements to current shareholders of a
specific Class of shares;
(b) Blue Sky registration fees incurred by a specific Class of
shares;
(c) SEC registration fees incurred by a specific Class of
shares;
(d) expenses of administrative personnel and services required
to support the shareholders of a specific Class of shares;
(e) Directors' fees or expenses incurred as a result of issues
relating to a specific Class of shares;
(f) accounting expenses relating solely to a specific Class of
shares;
(g) auditors' fees, litigation expenses, and legal fees and
expenses relating to a specific Class of shares; and
(h) expenses incurred in connection with shareholders meetings
as a result of issues relating to a specific Class of shares.
For any Fund, these expenses may, but are not required to, be directly
attributed and charged to a particular Class. The shareholder servicing
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fees and other expenses listed above that are attributed and charged to a
particular Class are borne on a pro rata basis by the outstanding shares of
that Class.
Certain expenses that may be attributable to a Fund, but not a
particular Class, are allocated based on the relative daily net assets of
the Classes of that Fund.
Exchange Privileges:
Class A shares of a Fund may be exchanged for Class A shares of any
other fund in W&R Funds, Inc. and, for customers of Waddell & Reed, Inc. or
Legend Equities, Corp. ("Legend"), for Class A shares of a fund in the
Waddell & Reed Advisors Funds (formerly known as the United Group of
Funds).
Class B shares of a Fund may be exchanged for Class B shares of any
other fund in W&R Funds, Inc. and, for customers of Waddell & Reed, Inc. or
Legend, for Class B shares of a fund in the Waddell & Reed Advisors Funds.
Class C shares of a Fund may be exchanged for Class C shares of any
other fund in W&R Funds, Inc. and, for customers of Waddell & Reed, Inc. or
Legend, for Class C shares of a fund in the Waddell & Reed Advisors Funds.
Class Y shares of a Fund may be exchanged for Class Y shares of any
other fund in Waddell & Reed Funds, Inc. or, for customers of Waddell &
Reed, Inc. or Legend, for Class Y shares of a fund in the Waddell & Reed
Advisors Funds.
These exchange privileges may be modified or terminated by a Fund, and
exchanges may only be made into funds that are legally registered for sale
in the investor's state of residence.
Additional Information:
This Plan is qualified by and subject to the terms of the then current
prospectus for the applicable Class; provided, however, that none of the
terms set forth in any such prospectus shall be inconsistent with the terms
of the Classes contained in this Plan. The prospectus for each Class
contains additional information about that Class and a Fund's multiple
class structure.
Adopted: October 3, 1995
As Amended: December 6, 1995, Effective: January 9, 1996
As Amended: February 10, 1999, Effective September 1, 1999
As Amended: November 17, 1999, Effective November 17, 1999
As Amended: February 9, 2000, Effective March 24, 2000
As Amended: May 17, 2000, Effective June 30, 2000
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