TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Benchmark will not be fully operable as the sole performance index used to determine the Adviser's Adjustment until the quarter ending February 28, 2003. Until that date, the Adviser's Adjustment will be determined by linking the investment performance of the Benchmark and that of the "Prior Benchmark," 65% of which will comprise of the Stock Index and 35% of which will comprise of the Xxxxxx Brothers Long-Term Corporate AA or Better Bond Index (the "Prior Bond Index") as follows:
1. QUARTER ENDING MAY 31, 2000. The Adviser's Adjustment will be determined by linking the investment performance of the Prior Benchmark for the eleven quarters ending February 29, 2000, with that of the Benchmark for the quarter ending May 31, 2000.
2. QUARTER ENDING AUGUST 31, 2000. The Adviser's Adjustment will be determined by linking the investment performance of the Prior Benchmark for the ten quarters ending February 29, 2000, with that of the Benchmark for the two quarters ending August 31, 2000.
3. QUARTER ENDING NOVEMBER 30, 2000. The Adviser's Adjustment will be determined by linking the investment performance of the Prior Benchmark for the nine quarters ending February 29, 2000, with that of the Benchmark for the three quarters ending November 30, 2000.
4. QUARTER ENDING FEBRUARY 28, 2001. The Adviser's Adjustment will be determined by linking the investment performance of the Prior Benchmark for eight quarters ending February 29, 2000, with that of the Benchmark for the four quarters ending February 28, 2001.
5. QUARTER ENDING MAY 31, 2001. The Adviser's Adjustment will be determined by linking the investment performance of the Prior Benchmark for the seven quarters ending February 29, 2000, with that of the Benchmark for the five quarter ending May 31, 2001.
6. QUARTER ENDING AUGUST 31, 2001. The Adviser's Adjustment will be determined by linking the investment performance of the Prior Benchmark for the six quarters ending February 29, 2000, with that of the Benchmark for the six quarter ending August 31, 2001.
7. QUARTER ENDING NOVEMBER 30, 2001. The Adviser's Adjustment will be determined by linking the investment performance of the Prior Benchmark for the five quarters ending February 29, 2000, with that of the Benchmark for the seven quarters ending November 30, 2001.
8. QUARTER ENDING FEBRUARY 28, 2002. The Adviser's Adjustment will be determined by linking the investment performance of the Prior Benchmark for four quarters ending February 29, 2002, with th...
TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Adjustment will not be fully operable until the close of the quarter ending June 30,2003. Until that time, the following transition rules will apply:
(a) June 29,2000 through March 31,2001. The Adviser's compensation will be the Basic Fee. No Adjustment will apply during this period.
(b) April 1,2001 through June 30,2003. Beginning April 1,2001, the Adjustment will take effect on a progressive basis with regards to the number of months elapsed between July 1, 2000, and the end of the quarter for which the Adviser's fee is being computed. During this period, the Adjustment outlined in Section 4.0 will be multiplied by a fraction. The fraction will equal the number of rnonths elapsed since July 1, 2000, divided by thirty- six.
(c) On and After July 1,200?1. Commencing July 1,2003, the Adjustment will be fully operable.
TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Adjustment will not be fully operable until the close of the quarter ending December 31, 2004. Until that date, the following transition rules will apply:
(a) DECEMBER 17, 2001 THROUGH SEPTEMBER 30, 2002. Adviser's compensation will be the Basic Fee. No Adjustment will apply during this period.
(b) OCTOBER 1, 2002 THROUGH DECEMBER 31, 2004. Beginning October 1, 2002, the Adjustment will take effect on a progressive basis with regards to the number of months elapsed between December 31, 2001, and the end of the quarter for which Adviser's fee is being computed. During the period, the Adjustment will be calculated using cumulative performance of the Fund and the Index from January 1, 2002 through the end of the applicable quarter. For these purposes, the endpoints and size of therange over which a positive or negative Adjustment applies and thecorresponding Adjustment amount will be multiplied by a fractionaltime-elapsed adjustment. The fraction will equal the number of months elapsed since January 1, 2002, divided by thirty-six. Example: Assume that the Adviser's compensation is being calculated for the quarter ended March 31, 2004, and that the cumulative performance of the Fund versus the Index for the applicable period is +7.0%. In this case, an Adjustment of +50.25% would apply. The following demonstrates the calculation: Calculate the fractional time-elapsed adjustment by dividing 27 months by 36 months (equals 75.0%), then multiply by the endpoints for the range over which the positive or negative Adjustment applies [(27/36) x 4.5% to (27/36) x 9.0% = 3.375% to 6.75%]. Given the portfolio's cumulative performance of +7.0% is greater than the time-elapsed adjusted range of +3.375% to +6.75%, multiply the fractional time-elapsed adjustment of 75.0% by the corresponding maximum adjustment for the time-elapsed adjusted range of greater than +6.75% or (75.0%)(67.0%) = +50.25%. (Note: actual calculations will be rounded to the third decimal point.)
(c) ON AND AFTER JANUARY 1, 2005. The Adjustment will be fully operable at this time.
TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Adjustment Amount will not be fully incorporated into the determination of the Adjusted Fee until the close of the quarter ending July 31, 2005. Until that date, the following transition rules will apply:
(a) DATE OF REORGANIZATION THROUGH APRIL 30, 2003. The Adjusted Fee will be equal to the Basic Fee. No Adjustment Amount will apply during this period.
(b) MAY 1, 2003 THROUGH JULY 31, 2005. Beginning May 1, 2003, the Adjusted Fee will be equal to the Basic Fee plus the Adjustment Amount as calculated on the following basis. The Adjustment Amount for the Relevant Fiscal Quarter will be determined on a progressive basis with regards to the number of months elapsed between July 31, 2002, and the end of the Relevant Fiscal Quarter ("Progressive Adjustment Period"). During the Progressive Adjustment Period, the Asset Fee for purposes of calculating the Adjustment Amount will be determined with respect to the period from July 31, 2002, through and including the end of the Relevant Fiscal Quarter. Similarly, the Adjustment Percentage will be calculated with respect to the cumulative performance of the Fund and the Index from August 1, 2002, through and including the end of the Relevant Fiscal Quarter. For these purposes, the endpoints and size of the range over which a positive or negative Adjustment Percentage applies and the corresponding maximum Adjusted Percentage will be multiplied by a fractional time-elapsed Adjustment Percentage. The fraction will equal the number of months elapsed since July 31, 2002, divided by thirty-six.
TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Adjustment will not be fully operable until the close of the quarter ending December 31, 2003. Until that time, the following transition rules will apply:
(a) October 1, 2000 through September 30, 2001. The Adviser's compensation will be the Basic Fee. No Adjustment will apply during this period.
(b) October 1, 2001 through October 31, 2003. Beginning October 1, 2001, the Adjustment will take effect on a progressive basis with regards to the number of months elapsed between October 31, 2000, and the end of the quarter for which the Adviser's fee is being computed, subject to the provisions of Section 4.2(e) of this Agreement. During this period, the endpoints and size of the range over which a positive or negative adjustment
TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Adjustment will not be fully operable until the close of the quarter ending September 30, 2003. Until that date, the following transition rules will apply:
(A) OCTOBER 1, 2000 THROUGH JUNE 30, 2001. Adviser's compensation will be the Basic Fee. No Adjustment will apply during this period.
(B) JULY 1, 2001 THROUGH SEPTEMBER 30, 2003. Beginning July 1, 2001, the Adjustment will take effect on a progressive basis with regards to the number of months elapsed between October 1, 2000, and the quarter for which Adviser's fee is computed. During this period, the +/-9% hurdle rate, as well as the Adjustment described in Section 4.0, will be multiplied by a fraction, which will equal the number of months elapsed since October 1, 2000, divided by 36. Example: Cumulative 18-month performance of the Lincoln Portfolio versus the Index is +8.1%. Accordingly, a performance fee Adjustment of +7.5% [(8.1 divided by 4.5%(a)) times 7.5% maximum] of the Basic Fee, as calculated over the trailing 18-months, would be due and payable.
(a) Note that the cumulative performance versus the Index exceeds the maximum hurdle rate (adjusted in this case).
(C) ON AND AFTER OCTOBER 1, 2003. The Adjustment will be fully operable at this time.
TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Index will not be fully operable as the sole performance index used to determine the Adviser's Adjustment until August 1, 2002. Until that date, the following transition rules will apply:
(a) JUNE 1, 2000 THROUGH JULY 31, 2002. Beginning June 1, 2000, the Adjustment will take effect on a progressive basis, with regard to the number of months elapsed between August 1, 1999, and the quarter for which the Adviser's fee is computed. During this period, the Adjustment that has been determined will be multiplied by a fraction, which will equal the number of months elapsed since August 1, 1999, divided by 36.
(b) ON AND AFTER AUGUST 1, 2002. The Adjustment will be fully operable at this time.
TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Performance Fee Adjustment will not be fully operable until June 1, 2002. Until that time, the following transition rules will apply:
(a) June 1, 1999 through May 31, 2000. The Adviser's compensation will be the Basic Fee. No Performance Fee Adjustment will apply during this period.
(b) June 1, 2000 through May 31, 2002. Beginning June 1, 2000, the Performance Fee Adjustment will take effect on a progressive basis with regards to the number of months elapsed between June, 1999 and the quarter for which the Adviser's fee is being computed. During this period, the Performance Fee Adjustment that has been determined under Section will be multiplied by a fraction. The fraction will equal the number of months elapsed since June 1, 1999 divided by thirty-six.
(c) On and After June 1, 2002. Beginning June 1, 2002, the Performance Fee Adjustment will be fully operable.
TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Adjustment will not be fully operable until the close of the quarter ending September 30, 2003. Until that time, the following transition rules will apply:
(a) JULY 31, 2000 THROUGH JUNE 30, 2001. The Adviser's compensation will be the Basic Fee. No Adjustment will apply during this period.
(b) JULY 1, 2001 THROUGH SEPTEMBER 30, 2003. Beginning July 1, 2001, the Adjustment will take effect on a progressive basis with regards to the number of months elapsed between October 1, 2000, and the quarter for which the Adviser's fee is being computed. During this period, the Adjustment outlined in Section 4.0 will be multiplied by a fraction. The fraction will equal the number of months elapsed since October 1, 2000, divided by thirty-six.
(c) On and after September 30, 2003. Commencing September 30, 2003, the Adjustment will be fully operable.
TRANSITION RULE FOR CALCULATING ADVISER'S COMPENSATION. The Adjustment Amount will not be fully incorporated into the determination of the Adjusted Fee until May 31, 2006. Until that date, the following transition rules will apply:
(a) MAY 31, 2003 THROUGH JANUARY 31, 2004. The Adjusted Fee will be equal to the Basic Fee. No Adjustment Amount will apply during this period.
(b) FEBRUARY 1, 2004 THROUGH MAY 31, 2006. Beginning February 1, 2004, the Adjustment will take effect on a progressive basis with regards to the number of months elapsed between May 31, 2003, and the end of the quarter for which Adviser's fee is being computed. During the period, the Adjustment will be calculated using cumulative performance of the Wellington Management Portfolio and the Index from May 31, 2003 through the end of the applicable quarter. For these purposes, the endpoints and size of the range over which a positive or negative Adjustment applies and the corresponding maximum fee adjustment amount will be multiplied by a fractional time-elapsed adjustment. The fraction will equal the number of months elapsed since May 31, 2003, divided by thirty-six.
