WORLD FUNDS TRUST EXPENSE LIMITATION AGREEMENT
THIS EXPENSE LIMITATION AGREEMENT, is made by and between CBOE Vest Financial, LLC (the “Adviser”) and World Funds Trust (the “Trust”) (“Agreement”), on behalf of the series of the Trust set forth in the set of schedules to this Agreement identified as “Schedule A” and then numerically designated (e.g., Schedule A-1) attached hereto (each a “Fund,” and collectively, the “Funds”) as of the “Effective Date” noted on each Schedule A with respect to each Fund.
WHEREAS, the Trust is a Delaware statutory trust, and is registered under the Investment Company Act of 1940, as amended (“1940 Act”), as an open-end management investment company of the series type, and each Fund is a series of the Trust;
WHEREAS, the Trust and the Adviser have entered into an Advisory Agreement dated July 6, 2016 (“Advisory Agreement”), pursuant to which the Adviser provides investment management services to each Fund for compensation based on the value of the average daily net assets of each such Fund;
WHEREAS, the Trust and the Adviser have determined that it is appropriate and in the best interests of each Fund and its shareholders to maintain the expenses of each Fund at a level below the level to which each such Fund would normally be subject in order to maintain each Fund’s expense ratio at the Maximum Annual Operating Expense Limit (as hereinafter defined) specified in each Schedule A hereto;
NOW THEREFORE, the parties hereto agree as follows:
1. Expense Limitation.
| a. | Applicable Expense Limit. To the extent that the aggregate expenses of every character
incurred by a Fund in any fiscal year, including but not limited to investment advisory
fees of the Adviser (but excluding interest, distribution fees pursuant to Rule
12b-1 Plans, taxes, acquired fund fees and expenses, brokerage commissions, dividend
expenses on short sales, and other expenditures which are capitalized in accordance
with generally accepted accounting principles and other extraordinary expenses not
incurred in the ordinary course of such Fund’s business) (“Fund Operating Expenses”),
exceed the Maximum Annual Operating Expense Limit, as defined in Section 1.2 below,
such excess amount (the “Excess Amount”) shall be the liability of the Adviser. |
|
| b. | Maximum Annual Operating Expense Limit. The Maximum Annual Operating Expense Limit with
respect to each Fund shall be the amount specified in each Schedule A based on a
percentage of the average daily net assets of each Fund. |
|
| c. | Method of Computation. To determine the Adviser’s liability with respect to the
Excess Amount, each month the Fund Operating Expenses for each Fund shall be annualized
as of the last day of the month. If the annualized Fund Operating Expenses for any
month of a Fund exceed the Maximum Annual Operating Expense Limit of such Fund,
the Adviser shall first waive or reduce its investment advisory fee for such month
by an amount sufficient to reduce the annualized Fund Operating Expenses to an |
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amount
no higher than the lowest Maximum Annual Operating Expense Limit applicable to a
particular class of shares of a Fund. If the amount of the waived or reduced investment
advisory fee for any such month is insufficient to pay the Excess Amount, the Adviser
may also remit to the appropriate Fund or Funds an amount that, together with the
waived or reduced investment advisory fee, is sufficient to pay such Excess Amount. |
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| d. | Year-End
Adjustment. If necessary, on or before the last day of the first month of each
fiscal year, an adjustment payment shall be made by the appropriate party in order
that the amount of the investment advisory fees waived or reduced and other payments
remitted by the Adviser to the Fund or Funds with respect to the previous fiscal
year shall equal the Excess Amount. |
2. Reimbursement of Fee Waivers and Expense Reimbursements.
| a. | Reimbursement. If, during any fiscal month in which the Advisory Agreement is still in effect,
the estimated aggregate Fund Operating Expenses of a class of shares of such Fund
for the fiscal month are less than the Maximum Annual Operating Expense Limit for
that month, the Adviser shall be entitled to reimbursement by such Fund, in whole
or in part as provided below, of the investment advisory fees waived or reduced
and other payments remitted by the Adviser with respect to a particular class of
such Fund pursuant to Section 1 hereof. The total amount of reimbursement to which
the Adviser may be entitled (“Reimbursement Amount”) shall equal, at any time, the
sum of all investment advisory fees previously waived or reduced by the Adviser
and all other payments remitted by the Adviser to the Fund with respect to a particular
class, pursuant to Section 1 hereof, during any of the previous three (3) fiscal
years, less any reimbursement previously paid by such Fund to the Adviser, pursuant
to this Sections 2.a, with respect to such waivers, reductions, and payments. The
Reimbursement Amount shall not include any additional charges or fees whatsoever,
including, e.g., interest accruable on the Reimbursement Amount. To the extent any
reimbursement is made pursuant to this Section 2.a, such reimbursement shall not
cause the Fund Operating Expenses to exceed the Maximum Annual Operating Expense
Limit that was in place with respect to each class of a Fund at the time the Adviser
waived or reduced its advisory fees or reimburse other expenses for such class of
the Fund. |
|
| b. | Method
of Computation. To determine each Fund’s accrual (with respect to each
class), if any, to reimburse the Adviser for the Reimbursement Amount, each month
the Fund Operating Expenses of each class of shares of the Fund shall be annualized
as of the last day of the month. If the annualized Fund Operating Expenses of a
class of shares of the Fund for any month are less than the Maximum Annual Operating
Expense Limit of such class of shares of such Fund, such Fund shall accrue with
respect to the particular class into its net asset value an amount payable to the
Adviser sufficient to increase the annualized Fund Operating Expenses of that Fund
to an amount no greater than the Maximum Annual Operating Expense Limit of the particular
class of shares of that Fund, provided that such amount paid to the Adviser will
in no event exceed the total Reimbursement Amount. For accounting purposes, amounts
accrued pursuant to this Section 2 shall be a liability of the Fund for purposes
of determining the Fund’s net asset value. |
|
| c. | Payment
and Year-End Adjustment. Amounts accrued pursuant to this Agreement shall be
payable to the Adviser as of the last day of each month. If necessary, on or before
the last day of the first month of each fiscal year, an adjustment payment shall
be made by the appropriate party in order that the actual Fund Operating Expenses
of a Fund for the prior fiscal year (including any reimbursement payments hereunder
with respect to such fiscal year) do not exceed the Maximum Annual Operating Expense
Limit. |
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3. Term and Termination of Agreement.
| a. | This Agreement
shall continue in effect with respect to the Fund until such date as noted on each
Schedule A and shall thereafter continue in effect with respect to each Fund from
year to year for successive one-year periods provided that Agreement may be terminated
by either party hereto, without payment of any penalty, upon ninety (90) days’
prior written notice to the other party at its principal place of business; provided
that, in the case of termination by the Adviser, such action shall be authorized
by resolution of a majority of the Non-Interested Trustees of the Trust or by a
vote of a majority of the outstanding voting securities of the Trust. |
4. Miscellaneous.
| a. | 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. |
|
| b. | Interpretation.
Nothing herein contained shall be deemed to require the Trust or the Funds
to take any action contrary to the Trust’s Agreement and Declaration of Trust
or by-laws, as amended from time to time, or any applicable statutory or regulatory
requirement to which it is subject or by which it is bound, or to relieve or deprive
the Trust’s Board of Trustees of its responsibility for and control of the
conduct of the affairs of the Trust or the Funds. The parties to this Agreement
acknowledge and agree that all litigation arising hereunder, whether direct or indirect,
and of any and every nature whatsoever shall be satisfied solely out of the assets
of the affected Fund and that no Trustee, officer or holder of shares of beneficial
interest of the Fund shall be personally liable for any of the foregoing liabilities.
The Trust’s Agreement and Declaration of Trust is on file with the Secretary
of State of the State of Delaware. The Agreement and Declaration of Trust and by-laws
describe in detail the respective responsibilities and limitations on liability
of the Trustees, officers, and holders of shares of beneficial interest. |
|
| c. | 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 Advisory Agreement or the 1940 Act,
shall have the same meaning as and be resolved by reference to such Advisory Agreement
or the 1940 Act. |
|
| d. | Enforceability. Any term or provision of this Agreement which is invalid or unenforceable in
any jurisdiction shall, as to such jurisdiction be ineffective to the extent of
such invalidity or unenforceability without rendering invalid or unenforceable the
remaining terms or provisions of this Agreement or affecting the validity or enforceability
of any of the terms or provisions of this Agreement in any other jurisdiction. |
|
| * * * * * |
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IN WITNESS,
WHEREOF, the parties hereto have caused this instrument to be executed on their
behalf by their duly authorized officers as of the dates noted on the Schedule as
attached hereto. |
WORLD FUNDS TRUST
On behalf of
the
Funds Noted on the Schedules to this Agreement
| By: | /s/ Xxxx Xxxxx III |
| Name: | Xxxx Xxxxx III |
| Title: | President and Principal Executive Officer |
| CBOE VEST FINANCIAL, LLC | |
| By: | /s/ Xxxxxx Xxxxxx |
| Name: | J. Xxxxxx Xxxxxx |
| Title: | Senior Managing Director |
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SCHEDULE A-1
to the
EXPENSE LIMITATION AGREEMENT
(the “Agreement”)
between
WORLD FUNDS TRUST (the “Trust”)
and
CBOE Vest
Financial, LLC
This Agreement relates to the following Funds of the Trust:
| Fund | Maximum
Annual Operating Expense Limit |
Effective Date |
Expiration Date |
| CBOE Vest
Defined Distribution Fund The following classes of shares of each of the foregoing Funds shall be subject to the Maximum Annual Operating Expense Limit noted in this schedule: Class A Shares Class C Shares Investor Class Shares Institutional Class Shares |
1.25% 1.25% 1.25% 1.25% |
February
18, 2016 February 18, 2016 February 18, 2016 February 18, 2016 |
February
28, 2018 February 28, 2018 February 28, 2018 February 28, 2018 |
IN WITNESS,
WHEREOF, the parties hereto have caused this instrument to be executed on their
behalf by their duly authorized officers as of the dates noted on this Schedule. |
| WORLD FUNDS TRUST |
| On behalf of the |
| Funds noted on this Schedules to the Agreement |
| By: | /s/ Xxxx Xxxxx III |
| Name: | Xxxx Xxxxx III |
| Title: | President and Principal Executive Office |
| CBOE VEST FINANCIAL, LLC | |
| By: | /s/ J. Xxxxxx Xxxxxx |
| Name: | J. Xxxxxx Xxxxxx |
| Title: | Senior Managing Director |
5
SCHEDULE A-2
to the
EXPENSE LIMITATION AGREEMENT
(the “Agreement”)
between
WORLD FUNDS TRUST (the “Trust”)
and
CBOE Vest
Financial, LLC
This Agreement relates to the following Funds of the Trust:
| Fund | Maximum
Annual Operating Expense Limit |
Effective
Date |
Expiration
Date |
| CBOE Vest
S&P 500® Buffer Protect Strategy Fund CBOE Vest S&P 500® Buffer Protect Strategy (January) Fund CBOE Vest S&P 500® Buffer Protect Strategy (February) Fund CBOE Vest S&P 500® Buffer Protect Strategy (March) Fund CBOE Vest S&P 500® Buffer Protect Strategy (April) Fund CBOE Vest S&P 500® Buffer Protect Strategy (May) Fund CBOE Vest S&P 500® Buffer Protect Strategy (June) Fund CBOE Vest S&P 500® Buffer Protect Strategy (July) Fund CBOE Vest S&P 500® Buffer Protect Strategy (August) Fund CBOE Vest S&P 500® Buffer Protect Strategy (September) Fund CBOE Vest S&P 500® Buffer Protect Strategy (October) Fund CBOE Vest S&P 500® Buffer Protect Strategy (November) Fund CBOE Vest S&P 500® Buffer Protect Strategy (December) Fund The following classes of shares of each of the foregoing Funds shall be subject to the Maximum Annual Operating Expense Limit noted in this schedule: Class A Shares Class C Shares Investor Class Shares Institutional Class Shares |
0.95% 0.95% 0.95% 0.95% |
July 14,
2017 July 14, 2017 July 14, 2017 July 14, 2017 |
February
28, 2019 February 28, 2019 February 28, 2019 February 28, 2019 |
IN WITNESS,
WHEREOF, the parties hereto have caused this instrument to be executed on their
behalf by their duly authorized officers as of the dates noted on this Schedule. |
WORLD FUNDS TRUST
On behalf of
the
Funds noted on this Schedules to the Agreement
| By: | /s/ Xxxx Xxxxx III |
| Name: | Xxxx Xxxxx III |
| Title: | President and Principal Executive Office |
| CBOE VEST FINANCIAL, LLC | |
| By: | /s/ J. Xxxxxx Xxxxxx |
| Name: | J. Xxxxxx Xxxxxx |
| Title: | Senior Managing Director |
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SCHEDULE A-3
to the
EXPENSE LIMITATION AGREEMENT
(the “Agreement”)
between
WORLD FUNDS TRUST (the “Trust”)
and
CBOE Vest
Financial, LLC
This Agreement relates to the following
Funds of the Trust:
| Fund | Maximum
Annual Operating Expense Limit |
Effective
Date |
Expiration
Date |
| CBOE Vest
S&P 500® Enhanced Growth Strategy Fund CBOE Vest S&P 500® Enhanced Growth Strategy (January) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (February) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (March) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (April) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (May) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (June) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (July) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (August) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (September) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (October) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (November) Fund CBOE Vest S&P 500® Enhanced Growth Strategy (December) Fund The following classes of shares of each of the foregoing Funds shall be subject to the Maximum Annual Operating Expense Limit noted in this schedule: Class A Shares Class C Shares Investor Class Shares Institutional Class Shares |
0.95% 0.95% 0.95% 0.95% |
July 14,
2017 July 14, 2017 July 14, 2017 July 14, 2017 |
February
28, 2019 February 28, 2019 February 28, 2019 February 28, 2019 |
IN WITNESS,
WHEREOF, the parties hereto have caused this instrument to be executed on their
behalf by their duly authorized officers as of the dates noted on this Schedule. |
WORLD FUNDS TRUST
On behalf of
the
Funds noted on this Schedules to the Agreement
| By: | /s/ Xxxx Xxxxx III |
| Name: | Xxxx Xxxxx III |
| Title: | President and Principal Executive Office |
| CBOE VEST FINANCIAL, LLC | |
| By: | /s/ J. Xxxxxx Xxxxxx |
| Name: | J. Xxxxxx Xxxxxx |
| Title: | Senior Managing Director |
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SCHEDULE A-4
to the
EXPENSE LIMITATION AGREEMENT
(the “Agreement”)
between
WORLD FUNDS TRUST (the “Trust”)
and
CBOE Vest
Financial, LLC
This Agreement relates to the following
Funds of the Trust:
| Fund | Maximum
Annual Operating Expense Limit |
Effective
Date |
Expiration
Date |
| CBOE Vest
S&P 500® Dividend Aristocrats Target Income Fund The following classes of shares of each of the foregoing Funds shall be subject to the Maximum Annual Operating Expense Limit noted in this schedule: Class A Shares Class C Shares Investor Class Shares Institutional Class Shares Class Y Shares |
0.95% 0.95% 0.95% 0.95% 0.70% |
July 14,
2017 July 14, 2017 July 14, 2017 July 14, 2017 July 14, 2017 |
February
28, 2019 February 28, 2019 February 28, 2019 February 28, 2019 February 28, 2019 |
IN WITNESS,
WHEREOF, the parties hereto have caused this instrument to be executed on their
behalf by their duly authorized officers as of the dates noted on this Schedule. |
WORLD FUNDS TRUST
On behalf of
the
Funds noted on this Schedules to the Agreement
| By: | /s/ Xxxx Xxxxx III |
| Name: | Xxxx Xxxxx III |
| Title: | President and Principal Executive Office |
| CBOE VEST FINANCIAL, LLC | |
| By: | /s/ J. Xxxxxx Xxxxxx |
| Name: | J. Xxxxxx Xxxxxx |
| Title: | Senior Managing Director |
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