Exhibit 99.8(d)2
AMENDED AND RESTATED EXPENSE LIMITATION AGREEMENT
INCOME AND EQUITY FUND
This AMENDED AND RESTATED EXPENSE LIMITATION AGREEMENT (this "Agreement"),
effective this 31st day of December, 2003, amends and restates the Expense
Limitation Agreement dated November 17, 1997, as amended and restated March 29,
2002, by and between Pacific Global Fund, Inc., a Maryland corporation doing
business as Pacific Advisors Fund Inc. (the "Corporation"), on behalf of the
Income and Equity Fund (the "Fund"), Pacific Global Investment Management
Company (the "Investment Manager"), and Bache Capital Management, Inc. (the
"Co-Manager" and each a "Manager").
W I T N E S S E T H:
WHEREAS, the Corporation on behalf of the Fund, and the Investment Manager
entered into an Investment Management Agreement dated October 16, 1992 (the
"Management Agreement"), pursuant to which the Investment Manager has rendered
and will render investment management and advisory services to the Fund for
compensation based on the value of the average daily net assets of the Fund; and
WHEREAS, the Corporation, on behalf of the Fund, and the Managers have
entered into a Co-Management Agreement, dated as of November 10, 2000 (the
"Co-Management Agreement"), pursuant to which the Managers will render
investment management and advisory services to the Fund for compensation based
on the value of the average daily net assets of the Fund; and
WHEREAS, the Corporation and the Managers determined that it was and is
appropriate and in the best interests of the Fund and its shareholders during
the Fund's start-up phase to maintain the Fund's expenses at a level below the
level to which the Fund would normally be subject; and
WHEREAS, during the period from October 16, 1992, through December 31,
2002, the Investment Manager waived fees and reimbursed the Fund for Fund
Operating Expenses (as defined in Section 1 below) pursuant to the Expense
Limitation Agreement, as amended from time to time, most recently as of March
29, 2002; and
WHEREAS, during the period from November 10, 2000, through December 31,
2002, the Co-Manager waived fees pursuant to the Expense Limitation Agreement,
as amended from time to time, most recently as of March 29, 2002; and
WHEREAS, the Expense Limitation Agreement, as amended from time to time,
provided that the Investment Manager and the Co-Manager may recoup some or all
of the management fees previously waived and Fund Operating Expenses previously
reimbursed, subject to specified conditions; and
WHEREAS, the Corporation and the Investment Manager have deemed it
appropriate to amend and restate the Expense Limitation Agreement, as set forth
below:
NOW THEREFORE, the parties hereto agree as follows:
1. EXPENSE LIMITATION.
1.1 APPLICABLE EXPENSE LIMIT. For each Class of the Fund, to the
extent that Class Operating Expenses in any fiscal year exceed the applicable
Class Operating Expense Limit, the Managers shall be liable for the portion of
such excess amount as does not exceed the amount of the investment advisory fees
for such year ("Class Excess Amount"). As used herein, "Class Operating
Expenses" shall mean the aggregate expenses of every character incurred by the
Fund in any fiscal year, including but not limited to investment advisory fees
of the Investment Manager and the Co-Manager (but excluding interest, taxes,
brokerage commissions, and other expenditures which are capitalized in
accordance with generally accepted accounting principles, and other
extraordinary expenses not incurred in the ordinary course of the Fund's
business), attributable to such Class in accordance with the Corporation's
Multi-Class Plan pursuant to Rule 18f-3 under the 1940 Act, as such Plan is in
effect from time to time (the "Multi-Class Plan"). Any waiver of investment
management fees hereunder shall be allocated between the Investment Manager and
the Co-Manager pro rata based on the applicable investment management fee rate.
1.2 CLASS OPERATING EXPENSE LIMIT. The Class Operating Expense Limit
in any fiscal year for the Fund's Class A shares shall be 1.85% of the average
daily net assets of the Fund attributable to Class A shares. The Class Operating
Expense Limit in any fiscal year for the Fund's Class C shares shall be 2.60% of
the average daily net assets attributable to Class C shares.
1.3 METHOD OF COMPUTATION.
1.3.1 DAILY COMPUTATION. The Investment Manager shall
determine on each business day whether the aggregate fiscal year-to-date Class
Operating Expenses exceed the applicable Class Operating Expense Limit, as such
Class Operating Expense Limit has been pro-rated to the date of such
determination (the "Pro-Rated Class Operating Expense Limit"). If, on any
business day, the aggregate fiscal year-to-date Class Operating Expenses do not
equal the Pro-Rated Class Operating Expense Limit, the amount of such difference
shall be netted against the total year-to-date Class Excess Amount, determined
as of the end of the previous business day, and the difference shall be accrued
for that day as a Daily Difference (which may be positive or negative as
appropriate), provided that after such accrual the total year-to-date Class
Excess Amount may not exceed the year-to-date investment advisory fees accrued
by the Managers with respect to that Class. A positive Daily Difference will
accrue if the aggregate fiscal year-to-date Class Operating Expenses exceed the
Pro-Rated Class Operating Expense Limit, and a negative Daily Difference will
accrue if the aggregate fiscal year-to-date Class Operating Expenses are less
than the Pro-Rated Class Operating Expense Limit.
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1.3.2 MONTHLY CALCULATION OF FEE WAIVER. At the end of each
month, the accruals made in such month pursuant to Section 1.3.1 above shall be
netted for each Class. If the total positive Daily Differences for such month
exceed the negative Daily Differences, the Managers pro rata shall waive their
respective investment advisory fees for the month with respect to such Class in
an amount equal to the net Daily Differences; if the total negative Daily
Differences for such month exceed the total positive Daily Differences, the
Managers shall not be required to waive their investment advisory fees for the
month; and further, the Managers shall not be obligated to waive fees at the end
of any month, to the extent that such waiver would cause the Manager's total
respective fiscal year-to-date fee waivers to exceed the then-current difference
between the aggregate fiscal year-to-date Class Operating Expenses and the
applicable year-to-date Class Operating Expense Limit. Any such waiver shall be
allocated among the Classes of the Fund in accordance with the terms of the
Fund's Multiple Class Plan Pursuant to Rule 18f-3 under the 1940 Act.
1.4. YEAR-END ADJUSTMENT. Each year, if necessary, within 30 days
after the completion of the audit of the Corporation's financial statements for
such fiscal year, an adjustment payment shall be made by the appropriate party
in order that the amount of the investment management fees waived or reduced
with respect to each Class with respect to such fiscal year shall equal the
applicable Class Excess Amount.
1.5 LIMITATION OF CO-MANAGER'S LIABILITY. In any fiscal year, the
Co-Manager's total liability for fee waivers hereunder shall not exceed the
investment management fee to which it would have been entitled under the
Co-Management Agreement in the absence of this Agreement. The Co-Manager's
obligations hereunder are several and not joint.
2. TERM AND TERMINATION OF AGREEMENT. This Agreement shall continue in
effect for a period of one year from the date of its execution and from year to
year thereafter provided such continuance is specifically approved by a majority
of the Directors of the Corporation who (i) are not "interested persons" of the
Corporation or any other party to this Agreement, as defined in the Act, and
(ii) have no direct or indirect financial interest in the operation of this
Agreement ("Non-Interested Directors"). Nevertheless, this Agreement may be
terminated by any party hereto, without payment of any penalty, upon 90 days'
prior written notice to the other parties at their principal place of business;
provided that, in the case of termination by the Fund, such action shall be
authorized by resolution of a majority of the Non-Interested Directors of the
Corporation or a vote of a majority of the outstanding voting securities of the
Fund.
3. MISCELLANEOUS.
3.1. PREVIOUSLY WAIVED FEES AND REIMBURSEMENTS BY THE MANAGERS. The
provisions of this Agreement providing in certain circumstances for repayment to
the Managers of fees previously waived and expenses previously reimbursed
hereunder, as set forth in former Section 2 of this Agreement, hereby are
terminated. Any fees previously waived or expenses reimbursed to the Fund by the
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Managers prior to the effective date of this Agreement are permanently waived by
the Managers.
3.2. NOTICES. Any notice under this Agreement shall be given in
writing, addressed and delivered, or mailed postpaid, (a) if to the Investment
Manager, to Pacific Global Investment Management Company, 000 Xxxxx Xxxxxxx
Xxxxxx, Xxxxx 000, Xxxxxxxx, XX 00000, (b) if to the Co-Manager, to Bache
Capital Management, Inc., 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx, XX
00000; and (c) if to the Corporation, at the foregoing office of the Investment
Manager.
3.3. CAPTIONS. The captions in this Agreement are included for
convenience of reference only and in no other way define or delineate any of the
provisions hereof or otherwise affect their construction or effect.
3.4. INTERPRETATION. Nothing herein contained shall be deemed to
require the Fund or the Corporation to take any action contrary to its Articles
of Incorporation or By-Laws, or any applicable statutory or regulatory
requirement to which it is subject or by which it is bound, or to relieve or
deprive the Board of Directors of its responsibility for and control of the
conduct of the affairs of the Corporation or the Fund.
3.5 DEFINITIONS. Any question of interpretation of any term or
provision of this Agreement, including but not limited to the investment
advisory fee, the computations of net asset values, and the allocation of
expenses, having a counterpart in or otherwise derived from the terms and
provisions of the Management Agreement, shall have the same meaning as and be
resolved by reference to such Agreement.
3.6 GOVERNING LAW. Except insofar as the 1940 Act or other federal
laws or regulations may be controlling, this Agreement shall be governed by, and
construed and enforced in accordance with the laws of the State of Maryland.
3.7 EFFECTIVE DATES. The provisions of Section 1 of this Agreement
shall become effective on February 15, 2004, and prior to that date, any fee
waiver or expense reimbursements shall be determined and paid in accordance with
Section 1 of the Expense Limitation Agreement with respect to the Fund, dated
November 17, 1997, as amended and restated March 29, 2002, without regard to
Section 2 thereof. The remaining provisions of this Agreement, including Section
3.1, shall be effective beginning on December 31, 2003.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by their
respective officers thereunto duly authorized and their respective corporate
seals to be hereunto affixed, as of the day and year first above written.
ATTEST: PACIFIC GLOBAL FUND, INC.
d/b/a PACIFIC ADVISORS FUND INC.
ON BEHALF OF THE
INCOME AND EQUITY FUND
By: /s/ Xxxxxxxxx X. Xxxxxxx By: /s/ Xxxxxxx X. Xxxxxx
ATTEST: PACIFIC GLOBAL INVESTMENT
MANAGEMENT COMPANY
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxx X. Xxxxxxx
ATTEST: BACHE CAPITAL MANAGEMENT, INC.
By: /s/ Xxxxxxx Xxxx By: /s/ Xxxxxxx X. Xxxxx
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