EXHIBIT (h)(12)
EXPENSE LIMITATION AGREEMENT
PACIFIC SELECT FUND
EXPENSE LIMITATION AGREEMENT, effective as of March 1, 2000, by and
between Pacific Life Insurance Company (the "Adviser") and Pacific Select Fund
(the "Trust"), on behalf of each of the Trust's separate portfolios (each a
"Portfolio," collectively, the "Portfolios").
WHEREAS, the Trust is a Massachusetts business trust and is registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), as an
open-end management investment company of the series type; and
WHEREAS, the Trust and the Adviser have entered into an Investment Advisory
Agreement dated November 9, 1987, as amended from time to time ("Advisory
Contract"), pursuant to which the Adviser provides investment advisory services
to the Portfolios for compensation based on the value of the average daily net
assets of the Portfolios; and
WHEREAS, the Trust and the Adviser have determined that it is appropriate
and in the best interests of the Portfolios and their shareholders to maintain
the expenses of the Portfolios at levels agreeable to the Trust and the Adviser;
NOW THEREFORE, the parties hereto agree as follows:
I. Expense Limitation.
------------------
A. Applicable Expense Limit. For purposes of this Agreement "Portfolio
------------------------
Operating Expenses" shall consist of the ordinary operating expenses
incurred by a Portfolio in any fiscal year, including organizational
expenses, and excluding the following: investment advisory fees;
additional custodial charges associated with holding foreign
securities; foreign taxes on dividends, interest, or gains; interest;
taxes; brokerage commissions and other transactional expenses;
extraordinary expenses such as litigation; other expenses not incurred
in the ordinary course of the Portfolio's business; and expenses of any
counsel or other persons or services retained by the Trust's trustees
who are not "interested persons," (as that term is defined in the 0000
Xxx) of the Adviser. To the extent that the Portfolio Operating
Expenses incurred by a Portfolio exceed the Operating Expense Limit, as
defined in Section I.B. below, the Adviser shall waive its fees under
the Advisory Agreement or otherwise reimburse the Portfolio for such
excess amount (the "Excess Amount").
B. Operating Expense Limit. The maximum Operating Expense Limit in any
-----------------------
fiscal year with respect to a Portfolio shall be the amount specified
in Schedule A based on a percentage of the average daily net assets of
the Portfolio for the period described in Section I.C.
C. Method of Computation. To determine the Adviser's obligation with
---------------------
respect to the Excess Amount, each day the Portfolio Operating Expenses
for each Portfolio shall be annualized. If the annualized Portfolio
Operating Expenses of a Portfolio
for any month exceeds the Operating Expense Limit for that Portfolio,
the Adviser shall waive or reduce its fee under the Advisory Agreement
or remit to that Portfolio an amount that, together with the waived or
reduced investment advisory fee, is sufficient to pay that day's Excess
Amount.
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 a Portfolio with respect to the previous fiscal year shall
equal the Excess Amount.
II. Term and Termination of Agreement.
---------------------------------
This Agreement shall have an initial term through December 31, 2001. This
Agreement shall automatically renew for one-year terms unless the Adviser
provides written notice of the termination of this Agreement to the Trust at
least 10 days prior to the end of the then-current term. In addition, this
Agreement shall terminate upon termination of the Advisory Contract, or it may
be terminated by the Trust, without payment of any penalty, upon ninety (90)
days' prior written notice to the Adviser at its principal place of business.
III. 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. 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 Contract or the 1940 Act, shall have the
same meaning as and be resolved by reference to such Advisory Contract
or the 1940 Act.
-2-
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.
PACIFIC SELECT FUND
ATTEST: /s/ Xxxxxx X. Milfs BY: /s/ Xxxxxx X. Xxxxxx
------------------------------ -----------------------------------
Name: Xxxxxx X. Milfs Name: Xxxxxx X. Xxxxxx
Title: Secretary Title: Chairman of the Board & Trustee
PACIFIC LIFE INSURANCE COMPANY
ATTEST: /s/ Xxxxxx X. Milfs BY: /s/ Xxxxxx X. Xxxxxx
------------------------------ -----------------------------------
Name: Xxxxxx X. Milfs Name: Xxxxxx X. Xxxxxx
Title: Secretary Title: Chairman of the Board & Chief
ATTEST: /s/ Xxxxxx X. Milfs BY: /s/ Xxxxx X. Xxxxxxx
------------------------------ -----------------------------------
Name: Xxxxxx X. Milfs Name: Xxxxx X. Xxxxxxx
Title: Secretary Title: President
-3-
SCHEDULE A
OPERATING EXPENSE LIMITS
Maximum Operating Expense Limit
(as a Percentage of average net assets)
---------------------------------------
0.25%
Aggressive Equity Portfolio 0.25%
Emerging Markets Portfolio 0.25%
Diversified Research Portfolio 0.25%
Small-Cap Equity Portfolio 0.25%
International Large-Cap Portfolio 0.25%
Bond and Income Portfolio 0.25%
Equity Portfolio 0.25%
I-Net Tollkeeper Portfolio 0.25%
Multi-Strategy Portfolio 0.25%
Equity Income Portfolio 0.25%
Growth LT Portfolio 0.25%
Mid-Cap Value Portfolio 0.25%
Equity Index Portfolio 0.25%
Small-Cap Index Portfolio 0.25%
REIT Portfolio 0.25%
International Value Portfolio 0.25%
Managed Bond Portfolio 0.25%
Money Market Portfolio 0.25%
High Yield Bond Portfolio 0.25%
Large-Cap Value Portfolio 0.25%
-4-
