FORM OF AMENDED AND RESTATED
EXPENSE LIMITATION AGREEMENT
EXPENSE LIMITATION AGREEMENT, made as of the ___ day of April, 1999, as
amended as of the __ day of _________, 2002, by and between Pacific Global Fund,
Inc., a Maryland corporation doing business as Pacific Advisors Fund Inc. (the
"Corporation"), on behalf of the Growth Fund (the "Fund"), and Pacific Global
Investment Management Company, a California corporation (the "Investment
Manager").
W I T N E S S E T H:
WHEREAS, the Corporation, on behalf of the Fund, and the Investment
Manager have entered into an Investment Management Agreement, dated April __,
1999 (the "Management Agreement"), pursuant to which the Investment Manager 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 Investment Manager have determined
that it is appropriate and in the best interests of the Fund and its
shareholders to maintain Fund expenses at a level below the level to which the
Fund would normally be subject during its start-up period; and
WHEREAS, the Corporation, on behalf of the Fund, the Investment
Manager, and Pacific Global Investors Services, Inc., a California corporation
(the "Transfer Agent"), entered into an Expense Limitation Agreement, dated as
of _____________ __, 1999; 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 the Class Operating Expenses in any fiscal year exceed the
applicable Class Operating Expense Limit, such excess amount (the "Class Excess
Amount") shall be the liability of the Investment Manager. As used herein,
"Class Operating Expenses" of a Class shall mean that the aggregate expenses of
every character incurred by the Fund in any fiscal year, including but not
limited to the Fund's organizational expenses and investment advisory fees of
the Investment Manager (but excluding interest, taxes, brokerage commissions,
and other expenditures which are capitalized in accordance with generally
accepted accounting principles, other extraordinary expenses not incurred in the
ordinary course of the Fund's business, and repayments pursuant to Section 2
hereof) attributable to
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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").
1.2 CLASS OPERATING EXPENSE LIMIT. The Class Operating Expense
Limit for the Fund's Class A Shares shall equal 2.50% of the average daily net
assets of the Fund attributable to Class A Shares. The Class Operating Expense
Limit for the Fund's Class C Shares shall equal 3.25% of the average daily net
assets of the Fund attributable to Class C Shares.
1.3 METHOD OF COMPUTATION.
1.3.1 FEE WAIVER. Fee Waivers will be determined separately
for each Class as follows. For each Class, as of the first day of each
fiscal quarter, the annual Class Operating Expenses for the Fund's
current fiscal year shall be estimated by adding (a) the Class
Operating Expenses actually incurred as of the first day of such
quarter to (b) an estimate of the Class Operating Expenses for the
remainder of such fiscal year. If such estimate exceeds the applicable
Class Operating Expense Limit, the Investment Manager shall waive or
reduce its investment management fee for each month of such quarter
with respect to such Class by an amount sufficient to reduce the
estimated Class Operating Expenses for such quarter to an amount no
higher than the applicable Class Operating Expense Limit. If a waiver
of all of the investment management fees with respect to such Class for
such quarter will not reduce the estimated Class Operating Expenses
below the Class Operating Expense Limit, the Investment Manager will
reimburse the Fund, for the benefit of such Class, for the difference
in accordance with Section 1.3.2 herein.
1.3.2 EXPENSE REIMBURSEMENT. Expense reimbursement payments
will be determined separately for each Class as follows. For each
Class, as of the last day of each fiscal quarter, the Investment
Manager shall determine the actual year-to-date Class Operating
Expenses and the actual year-to-date average daily net assets of the
Fund attributable to such Class. If at that time the actual
year-to-date Class Operating Expenses (net of any fee waiver or
reduction) exceed the year-to-date portion of the applicable Class
Operating Expense Limit, the Investment Manager shall pay to the Fund,
for the account of such Class, an amount sufficient to reduce the
year-to-date Class Operating Expenses (net of any fee waiver or
reduction) to the year-to-date portion of the applicable Class
Operating Expense Limit. If at that time the actual year-to-date Class
Operating Expenses (net of any fee waiver or reduction) are less than
the year-to-date portion of the applicable Class Operating Expense
Limit, the Fund, on behalf of such Class, shall repay to the Investment
Manager previously paid expense reimbursement amounts and/or fee
waivers in an amount such that the year-to-date Class Operating
Expenses (net of any remaining amount attributable to fee waiver or
reduction) shall be no greater than the year-to-date portion of the
applicable Class Operating Expense Limit, provided that the total of
such repayments by the Fund shall not exceed the total fee waivers and
expense reimbursement previously made by the Investment Manager with
respect to such Class for such fiscal year. Each payment hereunder
shall be due no later than 30 days after the end of the relevant fiscal
quarter.
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1.4 YEAR-END ADJUSTMENT. Each year, if necessary, within 30 days
after the completion of the audit of the Company'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 and
other payments remitted by the Investment Manager to the Fund with respect to
each Class for such fiscal year shall equal the applicable Class Excess Amount.
1.5 TERMINATION OF FEE WAIVER AND EXPENSE REIMBURSEMENTS. At any
time upon 90 days notice to the Fund, the Investment Manager may terminate its
obligations to make fee waivers and/or pay expense reimbursement payments
pursuant to Section 1 hereof.
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 either party
hereto, without payment of any penalty, upon 90 days' prior written notice to
the other party at its 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 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, and (b) if to the Corporation, at the
foregoing office of the Investment Manager.
3.2 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.
3.3 INTERPRETATION. Nothing herein contained shall be deemed to
require the Fund or the Corporation to take any action contrary to the 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.
3.4 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
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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.
3.5 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.
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 GROWTH FUND
By:
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Secretary
ATTEST: PACIFIC GLOBAL INVESTMENT
MANAGEMENT COMPANY
By:
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Secretary
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