EXPENSE LIMITATION AGREEMENT
EXPENSE LIMITATION AGREEMENT, effective as of April 23, 2003, between
Robeco USA, L.L.C. (the "Adviser") and Xxxxx, Xxxx & Xxxxx Funds Trust, a
Massachusetts business trust (the "Trust"), on behalf of its series, WPG
Quantitative Equity Fund (the "Fund").
WHEREAS, the Trust is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management company, and the
Fund is a series of the Trust;
WHEREAS, the Trust, on behalf of the Fund, and the Adviser have
entered into an Advisory Agreement (the "Advisory Agreement") pursuant to which
the Adviser provides investment advisory services to the Fund, which may be
amended from time to time, for compensation based on the value of the average
daily net assets of the Fund;
WHEREAS, the Trust, on behalf of the Fund, and the Adviser have also
entered into a Management Agreement (the "Management Agreement") pursuant to
which the Manager provides investment management services to the Fund, which may
be amended from time to time, for compensation based on the value of the average
daily net assets of the Fund;
WHEREAS, the Adviser has voluntarily determined that it is
appropriate and in the best interests of the Fund and its shareholders to
maintain the expenses of the Fund at 140 basis points. The Trust, on behalf of
the Fund, and the Adviser therefore have entered into this Expense Limitation
Agreement (the "Agreement") in order to maintain the expense ratio of the Fund
at 140 basis points for the period beginning on the date hereof and ending on
April 30, 2004; and
WHEREAS, the Fund is prepared to repay the Adviser such waived
advisory and management fees and reimbursed expenses if the Fund subsequently
achieves a sufficient level of assets.
NOW THEREFORE, in consideration of the mutual covenants set forth
herein and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. EXPENSE LIMITATION.
1.1 APPLICABLE EXPENSE LIMIT. During the Term (as defined in Section
2), the Adviser agrees to waive all or a portion of its management fee and
advisory fee to the extent necessary so that the total expenses of every
character incurred by the Fund (excluding interest, taxes, brokerage
commissions, 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 (I.E., litigation)) (with
such exclusions, "Operating Expenses") shall not exceed the Operating Expense
Limit (as defined in Section 1.2 below). During the Term, to the extent that
Operating Expenses incurred by the Fund in any fiscal year (after waiver of
advisory fees and management fees of the Adviser) exceed the Operating Expense
Limit, such excess amount (the "Excess Amount") shall be the liability of the
Adviser. The parties agree that to the extent Operating Expenses in any fiscal
year do not exceed the Operating Expense Limit, the management fee and advisory
fee shall be payable by the Fund up to the amounts payable under the Management
Agreement or the Advisory Agreement.
1.2 OPERATING EXPENSE LIMIT. The maximum "Operating Expense Limit" in
any year during the Term with respect to the Fund shall be 140 basis points,
based on a percentage of the average daily net assets of the Fund.
1.3 REIMBURSEMENT. The Adviser shall keep a record of the amounts of
advisory fees and management fees waived and Excess Amounts reimbursed pursuant
to Section 1.1 hereof ("Prior Expenses"). Subject to the last sentence of this
Section 1.3, if at any future date Operating Expenses of the Fund are less than
the Operating Expense Limit, the Adviser shall be entitled to payment by the
Fund of the amount of such Prior Expenses, without interest thereon, except to
the extent that such payment will cause Operating Expenses of the Fund to exceed
the Operating Expense Limit. If Operating Expenses of the Fund subsequently
exceed the Operating Expense Limit, the payment of Prior Expenses shall be
suspended. If subsequent payment of Prior Expenses shall be resumed to the
extent that Operating Expenses do not exceed the Operating Expense Limit, the
Operating Expense Limit in Section 1.1 shall (unless previously terminated in
accordance with the terms hereof) apply. The Adviser may seek reimbursement only
for Prior Expenses waived or paid by it during the two fiscal years prior to
such reimbursement; PROVIDED, HOWEVER, that such Prior Expenses may only be
reimbursed hereunder to the extent they were waived or paid after the date of
this Agreement (or any similar agreement). The provisions of this Agreement
shall survive the termination of this Agreement to the extent necessary to
permit any such reimbursement.
1.4 LIMITATION OF LIABILITY. The obligations and expenses incurred,
contracted for or otherwise existing with respect to the Fund shall be enforced
against the assets of the Fund and not against the assets of any other series of
the Trust. It is understood and expressly stipulated that neither the holders of
shares of the Fund nor the trustees or officers of the Trust shall be personally
liable hereunder.
1.5 METHOD OF COMPUTATION. To determine the Adviser's obligations
hereunder, each month the Fund Operating Expenses for the Fund shall be
annualized as of the last day of the month. If the annualized Fund Operating
Expenses for any month of the Fund exceed the Operating Expense Limit of the
Fund, the Adviser shall waive or reduce its advisory and/or management fees for
such month by an equal amount, and if necessary the Adviser shall remit an
amount to the Fund, sufficient to reduce the annualized Fund Operating Expenses
to an amount no higher than the Operating Expense Limit.
1.6 YEAR-END ADJUSTMENT. If necessary, on or before the last day of
the first month of each fiscal year during the Term, an adjustment payment shall
be made by the appropriate party in order that the amount of the advisory and
management fees waived or reduced and other payments remitted by the Adviser to
the Fund with respect to the previous fiscal year shall equal the Excess Amount.
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2. TERM; TERMINATION. The term ("Term") of the Applicable Expense Limit under
this Agreement shall begin on the date hereof and end on April 30, 2004. The
Term of this Agreement may be continued from year to year thereafter provided
each such continuance is specifically approved by each of the parties hereto,
including with respect to the Fund a majority of the non-interested Trustees of
the Trust; PROVIDED, HOWEVER, that no party shall be obligated to extend the
Term of this Agreement. This Agreement shall terminate automatically with
respect to the Fund and to the Adviser upon the termination of the Advisory
Agreement and/or the Management Agreement.
3. MISCELLANEOUS.
3.1 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.
3.2 INTERPRETATION. Nothing herein contained shall be deemed to
require the Trust to take any action contrary to the Trust's declaration of
trust or bylaws, 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 Fund.
3.3 DEFINITIONS. Any question of interpretation of any term or
provision of this Agreement, including but not limited to the advisory or
management 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, Management Agreement or the 1940 Act,
shall have the same meaning as and be resolved by reference to such Agreement or
the 1940 Act and to interpretations thereof, if any, by the United States Courts
or in the absence of any controlling decision of any such Court, by rules,
regulations or orders of the Securities and Exchange Commission ("SEC") issued
pursuant to the 1940 Act. In addition, if the effect of a requirement of the
1940 Act reflected in any provision of this Agreement is revised by rule,
regulation or order of the SEC, that provision will be deemed to incorporate the
effect of that rule, regulation or order. Otherwise the provisions of this
Agreement will be interpreted in accordance with the substantive laws of the
State of New York.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
signed by their respective officers as of the day and year first above written.
XXXXX, XXXX & XXXXX FUNDS TRUST,
on behalf of WPG QUANTITATIVE EQUITY FUND
/S/ XXXXXX X. XXXXXXX
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By: Xxxxxx X. Xxxxxxx
Its: Vice President and Secretary
ROBECO USA, L.L.C.
/S/ XXXXXX X. XXXXXXX
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By: Xxxxxx X. Xxxxxxx
Its: Managing Director
