OPERATING EXPENSES AGREEMENT
THIS OPERATING EXPENSES AGREEMENT (the "Agreement") is effective as of the
___ day of December, 2001, by and between MW CAPITAL MANAGEMENT FUNDS, a
Delaware business trust (hereinafter called the "Trust"), on behalf of each
series of the Trust listed in Appendix A hereto, as may be amended from time to
time (hereinafter referred to individually as a "Fund" and collectively as the
"Funds"), and METROPOLITAN WEST CAPITAL MANAGEMENT, LLC, a limited liability
company organized and existing under the laws of the State of California
(hereinafter called the "Manager").
WITNESSETH:
WHEREAS, the Manager renders advice and services to the Funds pursuant to
the terms and provisions of an Investment Management Agreement between the Trust
and the Manager, dated December ____, 2001 (the "Investment Management
Agreement"); and
WHEREAS, the Funds are responsible for, and have assumed the obligation
for, payment of certain expenses pursuant to Subparagraph 7(b) of the Investment
Management Agreement that have not been assumed by the Manager; and
WHEREAS, the Manager desires to limit the Funds' respective Operating
Expenses (as that term is defined in Paragraph 2 of this Agreement) pursuant to
the terms and provisions of this Agreement, and the Trust (on behalf of the
Funds) desires to allow the Manager to implement those limits;
NOW, THEREFORE, in consideration of the covenants and the mutual promises
hereinafter set forth, the parties hereto, intending to be legally bound hereby,
mutually agree as follows:
1. Limit on Operating Expenses. The Manager hereby agrees to limit each
Fund's Operating Expenses to the respective annual rate of total
Operating Expenses specified for that Fund in Appendix A of this
Agreement.
2. Definition. For purposes of this Agreement, the term "Operating
Expenses" with respect to a Fund is defined to include all expenses
necessary or appropriate for the operation of the Fund including the
Manager's investment advisory or management fee under Paragraph 8 of
the Investment Management Agreement, and other expenses described in
Paragraph 7 of the Investment Management Agreement, but does not
include any Rule 12b-1 fees, front-end or contingent deferred loads,
taxes, interest, dividend expenses, brokerage commissions, expenses
incurred in connection with any merger or reorganization or
extraordinary expenses such as litigation.
3. Reimbursement of Fees and Expenses. The Manager, under Subparagraph
8(d) of the Investment Management Agreement, retains its right to
receive reimbursement of reductions of its investment management fee
and Operating Expenses paid by it that are not its responsibility
under Paragraph 7 of the Investment Management Agreement.
4. Term. This Agreement shall become effective on the date specified
herein and shall remain in effect for a period of one (1) year, unless
sooner terminated as provided in Paragraph 5 of this Agreement. This
Agreement shall continue in effect thereafter for additional periods
not exceeding one (1) year so long as such continuation is approved
for each Fund at least annually by the Board of Trustees of the Trust
(and separately by the disinterested Trustees of the Trust).
5. Termination. This Agreement may be terminated at any time, and without
payment of any penalty, by either the Trust or by the Board of
Trustees of the Trust, on behalf of any one or more of the Funds, upon
sixty (60) days' written notice to the Manager. The Manager may
decline to renew this Agreement by written notice to the Trust at
least thirty (30) days before its annual expiration date.
6. Assignment. This Agreement and all rights and obligations hereunder
may not be assigned without the written consent of the other party.
7. Severability. If any provision of this Agreement shall be held or made
invalid by a court decision, statute or rule, or shall be otherwise
rendered invalid, the remainder of this Agreement shall not be
affected thereby.
8. Captions. The captions in this Agreement are included for convenience
of reference only and in no way define or limit any of the provisions
hereof or otherwise affect their construction of effect.
9. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of California without giving
effect to the conflict of laws principles thereof; provided that
nothing herein shall be construed to preempt, or to be inconsistent
with, any federal law, regulation or rule, including the Investment
Company Act of 1940, as amended, and the Investment Advisers Act of
1940, as amended, and any rules and regulations promulgated
thereunder.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested by their duly authorized officers, all on the day and
year first above written.
MW CAPITAL MANAGEMENT FUNDS METROPOLITAN WEST CAPITAL MANAGEMENT, LLC
By: By:
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Title: Title:
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Appendix A to
Operating Expenses
Agreement
Operating Expense
Fund Limit
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Metropolitan West Capital Intrinsic Value Equity 1.10%
Metropolitan West Capital International Value 1.40%
MW CAPITAL MANAGEMENT FUNDS METROPOLITAN WEST CAPITAL MANAGEMENT, LLC
By: By:
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Title: Title:
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