Subject: File No. S7-15-10
From: Michael Sigmon, CFP, ChFC, CFS

November 3, 2010

I believe the proposed changes to the current 12b-1 structure as it relates to C shares will adversely impact investors. The various share classes (A,B,C,etc) serve different client needs and objectives and your comparison of C share cost to the A share cost over a long-term period of 10 years or more is problematic in the absence of a needs and value analysis. Equally problematic would be to compare A share cost over the long-term to a fee based advisory program. Actually, in meeting clients needs and objectives the C share has more in common with a fee based program than it does with an A share. If you were comparing a fully loaded A share to a C share and

1) You were uncertain as to your investment holding period beyond 1 year

2) Desired the ability to withdraw funds as needed without charge after 1 year

3) Would like increased flexibility to change investments or fund families as your needs and objectives change

4) Would like to fully compensate your advisor on an ongoing basis for the valued long-term advisory support and services you receive

Which share class would you pick?

After over 25 years in financial services it has been my experience that the above example is often typical of a clients needs and concerns. This is the case for many middle income investors seeking a service and cost solution as provided by the C share that could approximate the service level and flexibility of a fee based program. A major issue I see with the SEC proposal occurs on the day the advisor must reduce customary account service to the client due to the advisors fee having been reduced by up to 75%. At this point the C share as a service model for the client loses its long-term value. Also, for this reason, I believe many advisors will want to position their practice in the future to avoid this issue. So I can see the reduced use of C shares if the current proposal is implemented and an increase in fee based programs for those clients who qualify at costs that on average will be higher than the C share service model. The major loss as I see it will be to middle income investors who will find their service choices limited and their ability to access ongoing advisory services substantially reduced over time.

Instead of the proposed changes to the 12b-1 structure I would suggest maintaining the current structure but with increased transparency and redefinition of fees. I submit for your consideration the use of a Cost Disclosure and Acknowledgement (CDA) form used for initial purchase and share class selection. The CDA would reference the prospectus and provide on a single page an estimated cost for 1 through 10 year periods for each share class as well as a definition of the types of fees and expenses comprising these costs. The form would be reviewed with the client by the advisor and signed by the client and advisor acknowledging review of these materials and further stating the clients belief that a specific share class best meets their financial needs and objectives. Some of the benefits of a Cost Disclosure and Acknowledgement form as I see them would be to,

1) Increase transparency of total costs and expenses for each share class

2) Increase investors understanding of these costs

3) Increase awareness of the types and purposes of fees and expenses

4) Clarify 12b-1 fees through redefinition of usage

I am suggesting this approach because I believe it can address the material issues and concerns before us while preserving an important share class choice for investors.

Finally, although I strongly suggest you reconsider the current proposal, should it be implemented as proposed I would urge you at the very least to permanently grandfather existing C share accounts to allow investors the continued opportunity to make their own decision concerning the desirability, value, and longevity of existing advisor relationships.

Thank you for your consideration,

Michael Sigmon, CFP, ChFC, CFS