SERVICE AND DISTRIBUTION PLAN
FOR
THE AQUINAS FUNDS, INC.
WHEREAS, The Aquinas Funds, Inc. (the "Company") is registered with
the Securities and Exchange Commission as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "Act"), having
four series, Aquinas Fixed Income Fund, Aquinas Value Fund, Aquinas Growth Fund
and Aquinas Small-Cap Fund (each a "Fund" and collectively the "Funds") and
certain of the above-referenced Funds have approved the adoption of this Plan
(as hereinafter defined) (each an "Approving Fund" and collectively the
"Approving Funds");
WHEREAS, each Approving Fund intends to act as a distributor of shares
of its respective stock as defined in Rule 12b-1 under the Act, and desires to
adopt a distribution plan pursuant to such Rule, and the Board of Directors has
determined that there is a reasonable likelihood that adoption of this Service
and Distribution Plan will benefit the respective Approving Fund and its
shareholders; and
WHEREAS, the Company, on behalf of each Approving Fund, may enter into
agreements with dealers and other financial service organizations to obtain
various distribution-related and/or shareholder services for the respective
Approving Fund, all as permitted and contemplated by Rule 12b-1 under the Act;
it being understood that to the extent any activity is one in which the
respective Approving Fund may finance without a Rule 12b-1 plan, such Approving
Fund may also make payments to finance such activity outside such plan and not
subject to its limitations.
NOW, THEREFORE, the Approving Funds hereby adopt this Service and
Distribution Plan (the "Plan") in accordance with Rule 12b-1 under the Act on
the following terms and conditions:
1. Distribution and Service Fee. Each Approving Fund may charge a
distribution expense and service fee on an annualized basis of 0.25% of the
Fund's average daily net assets. Such fee shall be calculated and accrued daily
and paid at such intervals as the Board of Directors of the Company shall
determine, subject to any applicable restriction imposed by rules of the
National Association of Securities Dealers, Inc.
2. Permitted Expenditures. The amount set forth in paragraph 1 of this
Plan shall be paid for services or expenses primarily intended to result in the
sale of the respective Approving Fund's shares. Each Approving Fund may pay all
or a portion of this fee to any securities dealer, financial institution or any
other person (the "Shareholder Organization(s)") who renders personal service to
shareholders, assists in the maintenance of shareholder accounts or who renders
assistance in distributing or promoting the sale of the respective Approving
Fund's shares pursuant to a written agreement approved by the Board of Directors
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of the Company (the "Related Agreement"). To the extent such fee is not paid to
such persons, each Approving Fund may use the fee for its expenses for
distribution of its shares including, but not limited to, payment by the
respective Approving Fund of the cost of preparing, printing and distributing
Prospectuses and Statements of Additional Information to prospective investors
and of implementing and operating the Plan as well as payment of capital or
other expenses of associated equipment, rent, salaries, bonuses, interest and
other overhead costs.
3. Effective Date of Plan. This Plan shall not take effect, with
respect to a particular Approving Fund, until it has been approved (together
with any related agreements) by votes of a majority of (i) the outstanding
voting securities of the respective Approving Fund as defined in the Act, if
such approval is required by the Act, (ii) the Board of Directors of the Company
and (iii) those Directors of the Company who are not "interested persons" of the
Company (as defined in the Act) and have no direct or indirect financial
interest in the operation of this Plan or any agreements related to it (the
"Rule 12b-1 Directors"), cast in person at a meeting (or meetings) called for
the purpose of voting on this Plan and such related agreements.
4. Continuance. Unless otherwise terminated pursuant to paragraph 6
below, with respect to a particular Approving Fund, this Plan shall continue in
effect for as long as such continuance is specifically approved at least
annually by vote of a majority of the Board of Directors of the Company and the
Rule 12b-1 Directors in the manner provided for approval of this Plan in
paragraph 3.
5. Reports. Any person authorized to direct the disposition of monies
paid or payable by any of the Approving Funds pursuant to this Plan or any
related agreement shall provide to the Company's Board of Directors and the
Board shall review, at least quarterly, a written report of the amounts so
expended and the purposes for which such expenditures were made.
6. Termination. With regard to a particular Approving Fund, this Plan
may be terminated at any time by vote of a majority of the Rule 12b-1 Directors
or by vote of a majority of the outstanding voting securities of the respective
Approving Fund as defined in the Act.
7. Amendments. This Plan may not be amended to increase materially the
amount of payments provided for in paragraph 1 hereof unless such amendment is
approved in the manner provided for initial approval in paragraph 3 hereof. No
other amendment to the Plan may be made unless approved by the vote of a
majority of the Board of Directors and the Rule 12b-1 Directors in the manner
provided in paragraph 3.
8. Selection of Directors. While this Plan is in effect, the selection
and nomination of Directors who are not interested persons (as defined in the
Act) of the Company shall be committed to the discretion of the Directors who
are not interested persons. However, nothing contained herein shall prevent the
participation of other persons in the selection and nomination process, provided
that a final decision on any such selection or
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nomination is within the discretion of, and approved by, a majority of the Rule
12b-1 Directors.
9. Records. Each Approving Fund shall preserve copies of this Plan and
any related agreements and all reports made pursuant to paragraph 5 hereof for a
period of not less than six years from the date of this Plan, or the agreements
or such report, as the case may be, the first two years in an easily accessible
place.
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