EXHIBIT H
XXXXX STREET FUNDS, INC.
June 25, 1999
Xxxxxx X. Xxxxx & Co. Incorporated
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
The Northwestern Mutual Life Insurance Company
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Northwestern Mutual Investment Services, Inc.
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
RE: AGREEMENT TO WAIVE FEES CHARGED TO XXXXX STREET FUNDS, INC.
Gentlemen:
This letter constitutes an agreement between Xxxxxx X. Xxxxx & Co.
Incorporated ("Baird"), The Northwestern Mutual Life Insurance Company ("NML"),
Northwestern Mutual Investment Services, Inc. ("NMIS") and Xxxxx Street Funds,
Inc. ("MSF") by and between each of the parties hereto as follows:
For each fiscal year of MSF beginning on or after April 1, 1999, and
ending on or before March 31, 2004, Baird, NML and NMIS agree to waive their
fees to the extent necessary so that Net Total Operating Expenses of each Class
of each Fund of MSF, after the waiver, do not exceed the amount indicated as the
maximum Net Total Operating Expenses (the "Expense Cap") in the then-effective
prospectus for MSF (the "Prospectus"). These fee waivers shall occur in the
following order for each Fund of MSF: first, NMIS shall waive its investment
advisory fee, provided that such waiver is allocated among the Classes of the
Fund in proportion to the relative net asset values of such Classes (a "Pro-Rata
Waiver"). Second, NML shall waive its Administration Agreement fee, provided
that such waiver is allocated among the Classes of the Fund in proportion to the
relative net asset values of such Classes. Third, Baird shall waive its
Distribution Plan (Rule 12b-1 Plan) fees. Fourth, Baird shall waive its
Shareholder Services Agreement fees. Finally, to the extent necessary to prevent
the Net Total Operating Expenses of any Class of any Fund from exceeding the
Expense Cap for such Class after each of the foregoing waivers, NMIS shall pay
or reimburse MSF's expenses.
To the extent that the Net Total Operating Expense ratios of the
Classes of a particular Fund cannot both be reduced simultaneously to the
maximum Net Total Operating Expense ratio set forth in the Prospectus through
the use of a Pro-Rata Waiver by NMIS and NML, then Baird agrees to waive its
Distribution Plan and Shareholder Servicing Agreement fees for the appropriate
Class of such Fund so as to reach the Expense Cap for that Class of such Fund.
In such circumstances, Baird shall first waive its Distribution Plan fees and
then its Shareholder
Servicing Agreement fees, to the extent necessary for such Class to reach the
Expense Cap for the fiscal year.
Notwithstanding any other provision herein, the fees waived by Baird
hereunder shall not exceed the amounts payable by Baird to NML under Section 3
of the Distribution and Marketing Agreement between NML, Baird and NMIS dated
March 31, 1997. NML agrees that it shall not be entitled to receive such amounts
from Baird as are waived by Baird under this Letter Agreement.
Very truly yours,
XXXXX STREET FUNDS, INC.
By: /S/
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Name: Xxxx X. Xxxx
Title: Vice President and Treasurer
Agreed to and accepted:
XXXXXX X. XXXXX & CO. INCORPORATED
By: /S/
--------------------------
Name:
----------------------------
Title:
----------------------------
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
By: /S/
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Name: Xxxx X. Xxxx
Title: Senior Vice President
NORTHWESTERN MUTUAL INVESTMENT
SERVICES, INC.
By:
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Name: Xxxx X. Xxxx
Title: Executive Vice President
118892
