EXPENSE REIMBURSEMENT AGREEMENT
GIANT 5 FUNDS
This EXPENSE REIMBURSEMENT AGREEMENT, effective as of July 1, 2007 is by
and between The Xxxxxx Group (the "Adviser") and Giant 5 Funds (the "Trust"), on
behalf of the Giant 5 Total Index System and the Giant 5 Total Investment
System, each a series of the Trust (each a "Fund" and, collectively, the
"Funds").
WHEREAS, the Trust is organized under Delaware Statutory Trust Law, and is
registered under the Investment Company Act of 1940 (the "1940 Act") as an
open-end management company of the series type; and
WHEREAS, the Trust, on behalf of the Funds, and the Adviser have entered
into an Investment Advisory Agreement (the "Advisory Agreement"), pursuant to
which the Adviser provides investment advisory services to the Funds for
compensation based on the value of the average daily net assets of each Fund;
and
WHEREAS, the Trust and the Adviser 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 a level below the level to which the Funds might
otherwise be subject;
NOW, THEREFORE, the parties to this Agreement acknowledge and agree to the
following:
1. Expense Limitation
1.1 Operating Expense Limit. The maximum Operating Expense Limit for a
fiscal year with respect to each Fund is 1.35% of the average daily net assets
of the Fund. This Operating Expense Limit shall become effective July 1, 2007
and excludes any previous operating expenses accrued or paid before this date.
1.2 Applicable Expense Limit. To the extent that the aggregate expenses
incurred by a Fund in the 2008 fiscal year (referred to as "Fund Operating
Expenses") exceed the Operating Expense Limit, the excess amount ("Excess
Amount") will be the liability of the Adviser. Fund Operating Expenses may
include, but are not limited to, investment advisory fees of the Adviser. Fund
Operating Expenses do not include interest, taxes, expenses incurred by other
investment companies in which the Fund may invest, brokerage commissions, other
expenditures capitalized in accordance with generally accepted accounting
principles, or other extraordinary expenses not incurred in the ordinary course
of the Fund's business.
1.3 Method of Computation. To determine the Adviser's liability with
respect to the Excess Amount, each month the Fund Operating Expenses will be
annualized as of the last day of the month. If the annualized Fund Operating
expenses exceed the Operating Expense Limit of the Fund for the month, the
Adviser will remit to the Fund an amount sufficient to reduce the annualized
Fund Operating Expenses Limit.
1.4 Year-End Adjustment. If necessary, on or before the last day of the
first month of each fiscal year, an annual adjustment payment will be made by
the appropriate party in order that the amount of the investment advisory fees
waived or reduced by the Adviser, as well as other payments remitted by the
Adviser to the Fund with respect to adjustments made to the Fund Operating
Expenses for the previous fiscal year, shall equal the Excess Amount.
2. Reimbursement of Fee Waivers and Expense Reimbursements
2.1 Reimbursement. If during any fiscal year in which the Advisory
Agreement is in effect, the estimated aggregate Fund Operating Expenses of a
Fund for the year are less than the Operating Expense Limit for that year, the
Adviser will be entitled to reimbursement of fees waived or remitted by the
Adviser to the Fund pursuant to Section 1 of this Agreement. The total amount of
reimbursement recoverable by the Adviser (the "Reimbursement Amount") is the sum
of all fees previously waived or remitted by the Adviser to the Fund during any
of the previous three (3) years, pursuant to Section l of this Agreement, less
any reimbursement previously paid by the Fund to the Adviser with respect to any
waivers, reductions, and payments made with respect to the Fund, provided, that
the amount payable to the Adviser pursuant to this Section 2.1 is limited to not
more than the difference between the Operating Expense Limit for the year and
the actual Fund Operating Expenses for that year. The Reimbursement Amount shall
not include fees waived and expenses reimbursed prior to the date of this
Agreement. In addition, the Reimbursement Amount may not include any additional
charges or fees, such as interest accruable on the Reimbursement Amount.
2.2 Board Approval. No Reimbursement Amount will be paid to the Adviser in
any fiscal year unless the Trust's Board of Trustees has determined that a
reimbursement is in the best interest of the Fund and its shareholders. The
Trust's Board of Trustees will determine quarterly in advance whether any
Reimbursement Amount may be paid to the Adviser during the quarter.
3. Term and Termination of Agreement.
This Agreement will continue in effect until March 31, 2008 and from year
to year thereafter provided that each continuance is specifically approved by a
majority of the Trustees of the Trust who are not "interested persons" of the
Trust or any other party to this Agreement, as defined in the 1940 Act, and (ii)
have no direct or indirect financial interest in the operation of this Agreement
(the "Independent Trustees"). Nevertheless, this Agreement may be terminated by
either party to the Agreement, without payment of any penalty, upon ninety (90)
days prior written notice to the other party at its principal place of business.
Action to terminate the Agreement must be authorized by resolution of a majority
of the Independent Trustees of the Trust.
4. Miscellaneous.
4.1 Captions. The captions in this Agreement are included for convenience
of reference only and do not define or delineate any of the provisions of the
Agreement, or otherwise affect their construction or effect.
4.2 Interpretation. Nothing in this Agreement requires the Trust or the
Fund to take any action contrary to the Trust's Declaration of Trust, Bylaws, or
any applicable statutory or regulatory requirement to which the Trust or the
Fund is subject, nor does this Agreement relieve or deprive the Trust's Board of
Trustees of its responsibility for and control of the conduct of the affairs of
the Trust or the Fund.
4.3 Definitions. Any questions of interpretation of any term or provision
of this Agreement has the same meaning and is to be resolved by reference to the
1940 Act and the Advisory Agreement between the parties.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by
their respective duly authorized officers, and have caused their respective
corporate seals to be affixed to this Agreement as of the day and year first
above written.
THE XXXXXX GROUP
By: /s/ Xxxxxxx Xxxxxx
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Name: Xxxxxxx Xxxxxx
Title: President
GIANT 5 FUNDS
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Secretary and Treasurer
