PACIFIC FUNDS SERIES TRUST AMENDED AND RESTATED EXPENSE LIMITATION AGREEMENT
AMENDED AND RESTATED EXPENSE LIMITATION AGREEMENT
THIS AMENDED AND RESTATED EXPENSE LIMITATION AGREEMENT (the “Agreement”), by and between Pacific Funds Series Trust (the “Trust” or “Pacific Funds”), on behalf of the series of Pacific Funds designated in the schedules to this Agreement (each a “Fund,” collectively, the “Funds”), and Pacific Life Fund Advisors LLC (“Adviser”), is effective August 1, 2020. This Agreement supersedes the prior Expense Limitation Agreement dated August 1, 2017 (the “Prior Agreement”).
WHEREAS, the Trust is a Delaware statutory 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;
WHEREAS, the Trust and the Adviser are parties to an Investment Advisory Agreement dated June 13, 2001, as amended and assumed by the Adviser (the “Advisory Contract”), pursuant to which the Adviser is authorized to provide investment advisory services to each Fund for compensation based on the value of the average daily net assets of the Fund; and
WHEREAS, the Trust and the Adviser (collectively, the “Parties”) have determined that it is appropriate and in the best interests of the Funds and their shareholders to maintain the expenses of the Funds at levels agreeable to the Parties;
NOW THEREFORE, in consideration of the premises and mutual promises and covenants contained herein, and good and fair consideration, the receipt and sufficiency of which are hereby acknowledged by the Parties, the Parties hereby agree as follows:
I. Expense Limitation
A. Expense Reimbursement. To the extent Fund Operating Expenses incurred by a Fund exceed the Operating Expense Limit for that Fund (“Excess Amount”) the Adviser shall reimburse the Fund for the Excess Amount, as provided below.
B. Fund Operating Expenses. For purposes of this Agreement, “Fund Operating Expenses” shall consist of the ordinary operating expenses incurred by a Fund in any fiscal year, including but not limited to administration fees and expenses; and organizational expenses. Fund Operating Expenses do not include the following: investment advisory fees (management fees); distribution and/or service fees; dividends on securities sold short; acquired fund fees and expenses; interest (including commitment fees); taxes (including foreign taxes on dividends, interest or gains); brokerage commissions and other transactional expenses; extraordinary expenses such as litigation expenses; and other expenses not incurred in the ordinary course of the Fund’s business (such as described in SEC No-Action Letters and IRS Private Letter Rulings).
C. Operating Expense Limit. For purposes of this Agreement, the “Operating Expense Limit” for a Fund shall be the amount specified in the schedules hereto.
D. Method of Computation. The Fund Operating Expenses for each Fund shall be annualized on a daily basis. If the annualized Fund Operating Expenses of a Fund exceeds the Operating Expense Limit then in effect for that Fund, the Adviser shall limit that Fund’s Fund Operating Expenses to the Operating Expense Limit by remitting to that Fund an amount that is sufficient to pay that day’s Excess Amount for that Fund.
E. 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 in order that the amount of the payments remitted by the Adviser to a Fund with respect to the previous fiscal year shall equal the Excess Amount.
F. Recoupment by Adviser. Each Fund agrees to repay the Adviser for amounts previously reimbursed, in accordance with the following sentence. The Adviser may recoup from a Fund in future periods, not to exceed three years from the date on which the reimbursement took place, amounts reimbursed by the Adviser pursuant to this Agreement and the Prior Agreement, provided the amount of recoupment would be limited to the lesser of (i) the Operating Expense Limit in effect at the time of the reimbursement or (ii) the Operating Expense Limit in effect at the time of recoupment.
II. Term and Termination of Agreement
This Agreement shall have an initial term through July 31, 2021. Thereafter, this Agreement shall automatically renew for successive one-year terms ending July 31st of each year, unless the Adviser provides written notice to the Board of Trustees of the Trust (the “Board”) of the Adviser’s decision not to renew this Agreement at least 10 calendar days prior to the beginning of the next one-year term. In addition, this Agreement may be terminated with regard to one or more Funds at any time by the mutual agreement of the Parties, subject to Board approval, provided the Fund Operating Expenses through July 31st of the then current term would be no higher than the then applicable Operating Expense Limit for each such Fund (in other words, the resulting expense arrangement must be no less favorable to the affected Funds).
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.
C. Limitation of Liability. The Adviser shall look only to the assets of the respective Fund for performance of this Agreement and repayment of any claim hereunder that the Adviser may have with respect to that Fund, and neither any of the other Funds of the Trust, nor any of the Trust’s trustees, officers, employees, agents or shareholders, shall be liable therefore.
D. Entire Agreement. This Agreement forms the entire understanding and agreement between the Parties with respect to the subject matter herein discussed. As used in the preceding sentence and all other occurrences herein, “Agreement” includes Schedules A, B, C and D hereto.
E. Amendments. This Agreement may be amended from time to time by the mutual agreement of the Parties, provided any amendment that increases the Operating Expense Limit for a Fund requires Board approval and cannot become effective before the expiration of the then current term.
F. Choice of Law. This Agreement shall be governed by the law of the State of Delaware, without regard to the conflict of law provision thereof.
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.
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By: /s/ Xxxxxx X. Xxxxxxxx |
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Name: Xxxxxx X. Xxxxxxxx |
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Title: Senior Vice President |
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PACIFIC LIFE FUND ADVISORS LLC |
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By: /s/ Xxxxxx X. Xxxxxxxx |
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Name: Xxxxxx X. Xxxxxxxx |
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Title: Senior Vice President |
SCHEDULE A
to the AMENDED AND RESTATED PACIFIC FUNDS SERIES TRUST
FOR: Portfolio Optimization Funds1
Operating Expense Limits for Class A, Class C and Advisor Class Shares:
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Maximum Operating Expense Limit
(as a Percentage of average daily net assets)
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Fund |
Contractual Rate |
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Pacific Funds Portfolio Optimization Conservative
Pacific Funds Portfolio Optimization Moderate-Conservative
Pacific Funds Portfolio Optimization Moderate
Pacific Funds Portfolio Optimization Growth
Pacific Funds Portfolio Optimization Aggressive-Growth
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0.15% through July 31, 2021
0.30% from August 1, 2021 through July 31, 2023 |
Effective: August 1, 2020
1 Pacific Funds Portfolio Optimization Conservative, Pacific Funds Portfolio Optimization Moderate-Conservative, Pacific Funds Portfolio Optimization Moderate, Pacific Funds Portfolio Optimization Growth, and Pacific Funds Portfolio Optimization Aggressive-Growth are, together, the “Portfolio Optimization Funds.”
SCHEDULE B
to the AMENDED AND RESTATED PACIFIC FUNDS SERIES TRUST
FOR: PF Fixed Income Funds2 and Pacific Funds Diversified Income
I. Operating Expense Limits for Class A Shares
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Maximum Operating Expense Limit (as a Percentage of average daily net assets)
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Fund
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Contractual Rate
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Pacific Funds Short Duration Income
Pacific Funds Core Income
Pacific Funds Strategic Income
Pacific Funds Floating Rate Income
Pacific Funds High Income
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0.10% through July 31, 2021 |
II. Operating Expense Limits for Class C Shares
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Maximum Operating Expense Limit (as a Percentage of average daily net assets)
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Fund |
Contractual Rate |
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Pacific Funds Short Duration Income
Pacific Funds Core Income |
0.10% through July 31, 2021 |
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Pacific Funds Strategic Income
Pacific Funds Floating Rate Income
Pacific Funds High Income
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0.05% through July 31, 2021 |
2 Pacific Funds Ultra Short Income, Pacific Funds Core Income, Pacific Funds Floating Rate Income, Pacific Funds High Income, Pacific Funds Short Duration Income and Pacific Funds Strategic Income are, together, the “PF Fixed Income Funds.” The expense caps for Class P shares of the PF Fixed Income Funds that are offered as Underlying Funds are stated in Schedule D to this Agreement.
III. Operating Expense Limits for Advisor Class Shares:
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Maximum Operating Expense Limit (as a Percentage of average daily net assets)
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Fund |
Contractual Rate |
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Pacific Funds Short Duration Income Pacific Funds Strategic Income Pacific Funds Floating Rate Income Pacific Funds High Income |
0.10% through July 31, 2021 |
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Pacific Funds Core Income |
0.05% through July 31, 2021 |
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Pacific Funds Ultra Short Income |
0.07% through July 31, 2022 |
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Pacific Funds Diversified Income
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0.10% through July 31, 2022 |
IV. Operating Expense Limits for Class I Shares:
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Maximum Operating Expense Limit (as a Percentage of average daily net assets)
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Fund |
Contractual Rate |
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Pacific Funds Short Duration Income Pacific Funds High Income |
0.10% through July 31, 2021 |
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Pacific Funds Core Income Pacific Funds Strategic Income Pacific Funds Floating Rate Income |
0.05% through July 31, 2021 |
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Pacific Funds Ultra Short Income
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0.07% through July 31, 2022 |
Effective: August 1, 2020
SCHEDULE C
to the PACIFIC FUNDS SERIES TRUST
AMENDED AND RESTATED EXPENSE LIMITATION AGREEMENT
FOR: PF U.S. Equity Funds3
I. Operating Expense Limits for Class A, Class C and Advisor Class Shares:
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Maximum Operating Expense Limit (as a Percentage of average daily net assets)
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Fund |
Contractual Rate |
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Pacific Funds Large-Cap Value Pacific Funds Small/Mid-Cap Pacific Funds Small-Cap Pacific Funds Small-Cap Value |
0.20% through July 31, 2021 |
II. Operating Expense Limits for Class R6 Shares:
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Maximum Operating Expense Limit (as a Percentage of average daily net assets)
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Fund |
Contractual Rate |
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Pacific Funds Large-Cap Value Pacific Funds Small/Mid-Cap Pacific Funds Small-Cap Pacific Funds Small-Cap Value |
0.10% through July 31, 2021 |
Effective: August 1, 2020
3 Pacific Funds Large-Cap Value, Pacific Funds Small/Mid-Cap, Pacific Funds Small-Cap and Pacific Funds Small-Cap Value are, together, the “PF U.S. Equity Funds.” The expense caps for Class P shares of the PF U.S. Equity Funds that are offered as Underlying Funds are stated in Schedule D to this Agreement.
SCHEDULE D
to the AMENDED AND RESTATED PACIFIC FUNDS SERIES TRUST
FOR: Class P of Underlying Funds
Operating Expense Limits for Class P Shares:
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Maximum Operating Expense Limit (as a Percentage of average daily net assets)
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Fund |
Contractual Rate |
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Pacific Funds Core Income Pacific Funds Floating Rate Income |
0.05% through July 31, 2021 |
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Pacific Funds High Income |
0.10% through July 31, 2021 |
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PF Inflation Managed Fund PF Managed Bond Fund PF Short Duration Bond Fund PF Emerging Markets Debt Fund PF Growth Fund PF Large-Cap Value Fund PF Small-Cap Growth Fund (formerly named PF Developing Growth Fund) PF Small-Cap Value Fund PF Real Estate Fund PF Emerging Markets Fund PF International Large-Cap Fund PF International Value Fund |
0.15% through July 31, 2021 0.30% from August 1, 2021 through July 31, 2023 |
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PF International Small-Cap Fund |
0.25% through July 31, 2021 |
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PF Multi-Asset Fund |
0.16% through July 31, 2021 |
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Pacific Funds Large-Cap Value Pacific Funds Small/Mid-Cap Pacific Funds Small-Cap Pacific Funds Small-Cap Value |
0.20% through July 31, 2021 |
Effective: August 1, 2020
