June 29, 2018
| June 29, 2018 |
Xxxxxx Funds
One Post Office Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Ladies and Gentlemen:
Xxxxxx Investment Management, LLC (“PIM”) hereby contractually agrees, as of the date hereof, with respect to the funds specified below, to waive fees and reimburse certain expenses in the manner provided below:
1. Other expenses.
a. XXX agrees to waive fees and/or reimburse expenses of each open-end fund listed on Schedule A and each variable trust fund listed on Schedule B to the extent necessary to limit the cumulative expenses of the fund, exclusive of brokerage, interest, taxes, investment-related expenses (including borrowing costs, i.e., short selling and lines of credit costs), extraordinary expenses, acquired fund fees and expenses, and payments under the fund’s investor servicing contract, the fund’s investment management contract (including any applicable performance-based upward or downward adjustment to a fund’s base management fee), and the fund’s distribution plans, to an annual (measured on a fiscal year basis) rate of 0.20% of the fund’s average net assets. This contractual waiver will remain in effect for a fund through the expiration of one year following the effective date of the next annual update of the fund’s registration statement.
b. XXX agrees to waive fees and/or reimburse expenses of Xxxxxx Dynamic Asset Allocation Equity Fund to the extent necessary to limit the cumulative expenses of the fund, exclusive of brokerage, interest, taxes, investment-related expenses (including borrowing costs, i.e., short selling and lines of credit costs), extraordinary expenses, acquired fund fees and expenses, and payments under the fund’s investor servicing contract, the fund’s investment management contract, and the fund’s distribution plans, to an annual (measured on a fiscal year basis) rate of 0.02% of the fund’s average net assets. This contractual waiver will remain in effect through the expiration of the one-year period following the effective date of the next annual update of the fund’s registration statement.
2. Fund-specific expense limitations.
a. As set forth in the table below, PIM agrees to waive fees and/or reimburse expenses of each fund set forth below to the extent that the total annual fund operating expenses for the fund -- exclusive of payments under the fund’s distribution plans, any applicable performance-based upward or downward adjustment to the fund’s base management fee, brokerage, interest, taxes, investment-related expenses (including borrowing costs, i.e., short selling and lines of credit costs), extraordinary expenses, and acquired fund fees and expenses – would exceed the specified rate through the specified date, which is the expiration of the one-year period following the effective date of the next annual update of each fund’s registration statement:
| Fund | Proposed Contractual | Expiration |
| Limitation on Total | ||
| Fund Operating | ||
| Expenses | ||
| Xxxxxx Emerging Markets Income Fund | 1.00% | March 30, 2020 |
| Xxxxxx Mortgage Opportunities Fund | 0.05%1 | Sept. 30, 2019 |
| Xxxxxx Mortgage Opportunities Fund | 0.47%2 | Sept. 30, 2019 |
| Xxxxxx VT International Growth Fund3 | 1.09% | April 30, 2020 |
| Xxxxxx VT Multi-Asset Absolute Return Fund | 0.90% | April 30, 2020 |
| Xxxxxx VT Mortgage Securities Fund | 0.50% | April 30, 2020 |
b. As set forth in the table below, PIM agrees to waive fees and/or reimburse expenses of each fund set forth below to the extent that the total annual fund operating expenses for the fund – exclusive of payments under the fund’s distribution plans, payments under the fund’s investor servicing contract, any applicable performance-based upward or downward adjustment to the fund’s base management fee, brokerage, interest, taxes, investment-related expenses (including borrowing costs, i.e., short selling and lines of credit costs), extraordinary expenses, and acquired fund fees and expenses – would exceed the specified rate through the specified date, which is the expiration of the one-year period following the effective date of the next post-effective amendment of each fund’s registration statement:
_______________________________________________
1 With respect to Xxxxxx Mortgage Opportunities Fund, the 0.05% expense limitation applies to the total fund operating expenses excluding payments under the management contract; brokerage; interest; taxes; investment-related expenses; extraordinary expenses; and acquired fund fees and expenses.
2 With respect to Xxxxxx Mortgage Opportunities Fund the 0.47% expense limitation applies to the total annual fund operating expenses excluding brokerage; interest; taxes; investment-related expenses; (including borrowing costs, i.e., short selling and lines of credit costs); extraordinary expenses; and acquired fund fees and expenses.
3 The expense limitation described here for Xxxxxx VT International Growth Fund will be effective as of October 1, 2018.
| 2 |
| Fund | Proposed Contractual | Expiration |
| Limitation on Total | ||
| Fund Operating | ||
| Expenses | ||
| Xxxxxx Dynamic Risk Allocation Fund | 0.70% | Sept. 30, 2019 |
| Xxxxxx Emerging Markets Equity Fund4 | 0.78% | December 30, 2019 |
| Xxxxxx Intermediate-Term Municipal Income Fund | 0.52% | March 30, 2020 |
| Xxxxxx International Growth Fund5 | 0.93% | January 30, 2020 |
| Xxxxxx Mortgage Securities Fund | 0.32% | January 30, 2020 |
| Xxxxxx Multi-Asset Absolute Return Fund | 0.77% | Feb. 28, 2020 |
| Xxxxxx Short Duration Income Fund | 0.24% | Nov. 30, 2018 |
| Xxxxxx Short-Term Municipal Income Fund | 0.28% | March 30, 2020 |
3. Xxxxxx Short Term Investment Fund. XXX agrees to waive the contractual management fee of 0.25% for Xxxxxx Short Term Investment Fund through November 30, 2019, the expiration of the one-year period following the effective date of the next annual update of the fund’s registration statement.
4. Fund of Funds. XXX agrees to reimburse the Xxxxxx fund-of-funds specified below for all other expenses – exclusive of payments under the fund’s distribution plans, brokerage, interest, taxes, investment-related expenses, extraordinary expenses, acquired fund fees and expenses (and in the case of Xxxxxx Retirement Income Fund Lifestyle 1 and the Xxxxxx RetirementReady® Funds, payments under the fund’s investor servicing contract) – through the dates indicated below, which, with the exception of Xxxxxx RetirementReady® 2060 Fund, equate to the expiration of the one-year period following the effective date of the next annual update of each fund’s registration statement.
| Fund | Expiration |
| Xxxxxx Global Sector Fund | Feb. 28, 2020 |
| Xxxxxx Retirement Income Fund Lifestyle 1 | Nov. 30, 2019 |
| Xxxxxx RetirementReady® Funds* | Nov. 30, 2019 |
* The expense limitation for Xxxxxx RetirementReady® 2060 Fund expires on Nov. 30, 2028.
4 The expense limitation described here for Xxxxxx Emerging Markets Equity Fund will be effective as of August 1, 2018.
5 The expense limitation described here for Xxxxxx International Growth Fund will be effective as of October 1, 2018.
| 3 |
Effective June 29, 2018, this contractual undertaking supersedes any prior contractual expense limitation provisions between PIM and the funds. This undertaking shall be binding upon any successors and assignees of PIM.
A copy of the Declaration of Trust (including any amendments thereto) of each of The Xxxxxx Funds is on file with the Secretary of The Commonwealth of Massachusetts, and notice is hereby given that this instrument is executed on behalf of the Trustees of each Xxxxxx Fund as trustees and not individually and that the obligations of or arising out of this instrument are not binding upon any of the Trustees or officers or shareholders individually, but binding only upon the assets and property of each Xxxxxx Fund with respect to its obligations under this instrument. Furthermore, notice is given that the assets and liabilities of each series of each Xxxxxx Fund that is a series company are separate and distinct and that the obligations of or arising out of this instrument are several and not joint or joint and several and are binding only on the assets of each series with respect to its obligations under this instrument. Each fund is acting on its own behalf separately from all of the other investment companies and not jointly or jointly and severally with any of the other investment companies.
| Very truly yours, | |||
| XXXXXX INVESTMENT MANAGEMENT, LLC | |||
| By: | /s/ Xxxxxx X. Xxxxx | ||
| Xxxxxx X. Xxxxx | |||
| Vice President and Chief Legal Officer | |||
| Agreed and accepted by each Xxxxxx fund listed on Schedule A, | |
| Schedule B and Schedule C | |
| By: | /s/ Xxxxxxxx X. Xxxxxxx |
| Xxxxxxxx X. Xxxxxxx | |
| Executive Vice President, Principal | |
| Executive Officer, and Compliance Liaison | |
| 4 |
| Schedule A |
| Xxxxxx California Tax Exempt Income Fund |
| Xxxxxx Convertible Securities Fund |
| Xxxxxx Diversified Income Trust |
| Xxxxxx Asset Allocation Funds |
| - Xxxxxx Dynamic Asset Allocation Balanced Fund |
| - Xxxxxx Dynamic Asset Allocation Conservative Fund |
| - Xxxxxx Dynamic Asset Allocation Growth Fund |
| Xxxxxx Equity Income Fund |
| Xxxxxx Europe Equity Fund |
| Xxxxxx Funds Trust |
| - Xxxxxx Capital Spectrum Fund |
| - Xxxxxx Dynamic Risk Allocation Fund |
| - Xxxxxx Emerging Markets Equity Fund |
| - Xxxxxx Emerging Markets Income Fund |
| - Xxxxxx Equity Spectrum Fund |
| - Xxxxxx Fixed Income Absolute Return Fund |
| - Xxxxxx Floating Rate Income Fund |
| - Xxxxxx Global Consumer Fund |
| - Xxxxxx Global Financials Fund |
| - Xxxxxx Global Industrials Fund |
| - Xxxxxx Global Technology Fund |
| - Xxxxxx Global Telecommunications Fund |
| - Xxxxxx Intermediate-Term Municipal Income Fund |
| - Xxxxxx International Value Fund |
| - Xxxxxx Multi-Asset Absolute Return Fund |
| - Xxxxxx Multi-Cap Core Fund |
| - Xxxxxx Short Duration Bond Fund |
| - Xxxxxx Short Duration Income Fund |
| - Xxxxxx Short-Term Municipal Income Fund |
| - Xxxxxx Small Cap Growth Fund |
| Xxxxxx Xxxxxx Balanced Fund |
| Xxxxxx Global Equity Fund |
| Xxxxxx Global Health Care Fund |
| Xxxxxx Global Income Trust |
| Xxxxxx Global Natural Resources Fund |
| Xxxxxx Global Utilities Fund |
| Xxxxxx High Yield Fund |
| Xxxxxx Income Fund |
| Xxxxxx International Equity Fund |
| Xxxxxx Investment Funds |
| - Xxxxxx Capital Opportunities Fund |
| - Xxxxxx Government Money Market Fund |
| - Xxxxxx Growth Opportunities Fund |
| - Xxxxxx International Capital Opportunities Fund |
| 5 |
| - Xxxxxx International Growth Fund |
| - Xxxxxx PanAgora Managed Futures Strategy |
| - Xxxxxx PanAgora Market Neutral Fund |
| - Xxxxxx PanAgora Risk Parity Fund |
| - Xxxxxx Research Fund |
| - Xxxxxx Small Cap Value Fund |
| - Xxxxxx Sustainable Future Fund |
| Xxxxxx Massachusetts Tax Exempt Income Fund |
| Xxxxxx Minnesota Tax Exempt Income Fund |
| Xxxxxx Money Market Fund |
| Xxxxxx Mortgage Securities Fund |
| Xxxxxx New Jersey Tax Exempt Income Fund |
| Xxxxxx New York Tax Exempt Income Fund |
| Xxxxxx Ohio Tax Exempt Income Fund |
| Xxxxxx Pennsylvania Tax Exempt Income Fund |
| Xxxxxx Sustainable Leaders Fund |
| Xxxxxx Tax Exempt Income Fund |
| Xxxxxx Tax-Free Income Trust |
| - Xxxxxx AMT-Free Municipal Fund |
| - Xxxxxx Tax-Free High Yield Fund |
| 6 |
| Schedule B |
Xxxxxx Variable Trust
| - Xxxxxx VT Capital Opportunities Fund |
| - Xxxxxx VT Diversified Income Fund |
| - Xxxxxx VT Equity Income Fund |
| - Xxxxxx VT Xxxxxx Xxxxxx Balanced Fund |
| - Xxxxxx VT Global Asset Allocation Fund |
| - Xxxxxx VT Global Equity Fund |
| - Xxxxxx VT Global Health Care Fund |
| - Xxxxxx VT Global Utilities Fund |
| - Xxxxxx VT Government Money Market Fund |
| - Xxxxxx VT Growth Opportunities Fund |
| - Xxxxxx VT High Yield Fund |
| - Xxxxxx VT Income Fund |
| - Xxxxxx VT International Equity Fund |
| - Xxxxxx VT International Growth Fund |
| - Xxxxxx VT International Value Fund |
| - Xxxxxx VT Investors Fund |
| - Xxxxxx VT Mortgage Securities Fund |
| - Xxxxxx VT Multi-Asset Absolute Return Fund |
| - Xxxxxx VT Research Fund |
| - Xxxxxx VT Small Cap Value Fund |
| - Xxxxxx VT Sustainable Future Fund |
| - Xxxxxx VT Sustainable Leaders Fund |
| 7 |
| Schedule C |
Other Funds Subject to Expense Limitations
| Xxxxxx Global Sector Fund |
| Xxxxxx Funds Trust |
| - Xxxxxx Dynamic Asset Allocation Equity Fund |
| - Xxxxxx Short Term Investment Fund |
| Xxxxxx RetirementReady Funds |
| - Xxxxxx Retirement Income Fund Lifestyle 1 |
| - Xxxxxx RetirementReady 2060 Fund |
| - Xxxxxx RetirementReady 2055 Fund |
| - Xxxxxx RetirementReady 2050 Fund |
| - Xxxxxx RetirementReady 2045 Fund |
| - Xxxxxx RetirementReady 2040 Fund |
| - Xxxxxx RetirementReady 2035 Fund |
| - Xxxxxx RetirementReady 2030 Fund |
| - Xxxxxx RetirementReady 2025 Fund |
| - Xxxxxx RetirementReady 2020 Fund |
| 8 |
