EXPENSE LIMITATION AGREEMENT
As of
August 1, 2009
Board of
Trustees
00
Xxxxxxx Xxxxxx
Xxx Xxxx,
XX 00000
Dear
Board of Trustees:
(1) This
letter will confirm our intent that in the event the annualized ratio of total
ordinary Funds operating expenses (excluding taxes, interest, litigation,
extraordinary expenses, brokerage and other transaction expenses relating to the
purchase or sale of portfolio investments and the fees and expenses of any other
Funds in which the Funds invest) to average daily net assets of the Class A
shares of each series of Eclipse Funds Inc. listed below (the “Funds”),
calculated daily in accordance with generally accepted accounting principles
consistently applied, exceeds the percentages set forth below, we will assume a
portion of the Funds’ operating expenses in the amount of such
excess. An equivalent reduction will apply to the other share classes
of the Funds.
|
FUNDS
|
EXPENSE
LIMIT
|
|
Convertible
Fund
|
1.18
%
|
|
Diversified
Income Fund
|
1.19
%
|
|
Global
High Income Fund
|
1.35
%
|
|
Government
Fund
|
1.03
%
|
|
MAP
Fund
|
1.28
%
|
|
Tax
Free Bond Fund
|
0.94
%
|
We
authorize the Funds and the administrator to reduce our monthly management fees
or reimburse the monthly expenses of the appropriate Classes of the Funds to the
extent necessary to effectuate the limitations stated in this Section (1),
consistent with the method set forth in Section (4) below. We
authorize the Funds and their administrator to request funds from us as
necessary to implement the limitations stated in this Section (1). We
will pay to the Funds or Classes any such amounts, consistent with the method
set forth in Section (4) below, promptly after receipt of such
request.
(2) The
expense caps set forth in this Agreement are effective for a one-year period
from August 1, 2009 through July 31, 2010.
(3) The
foregoing expense limitations supersede any prior agreement regarding expense
limitations. Each expense limitation is an annual, not monthly,
expense limitation, and is based on the fiscal years of the
Funds. Consequently, if the amount of expenses accrued during a month
is less than an expense limitation, the following shall apply: (i) we shall be
reimbursed by the respective Fund(s) or Class(es) in an amount equal to such
difference, consistent with the method set forth in Section (4) below, but not
in an amount in excess of any deductions and/or payments previously made during
the year; and (ii) to the extent reimbursements are not made pursuant to
Sub-Section 3(i), the Fund(s) and/or Class(es) shall establish a credit to be
used in reducing deductions and/or payments which would otherwise be made in
subsequent months of the year. We shall be entitled to recoupment from a Fund or
Class of any fee waivers or expense reimbursements pursuant to this arrangement
consistent with the method set forth in Section (4) below, if such action does
not cause the Fund or Class to exceed existing expense limitations, and the
reimbursement is made in the one-year term of this Agreement during which we
incurred the expense.
(4) Any
amount of fees or expenses waived, paid or reimbursed pursuant to the terms of
this Agreement shall be allocated among the Classes of shares of the Funds in
accordance with the terms of the Funds’ multiple class plan pursuant to Rule
18f-3 under the Investment Company Act of 1940, as amended (the “18f-3
Plan”). To this end, the benefit of any waiver or reimbursement of
any management fee and any other “Fund Expense,” as such term is defined in the
18f-3 Plan, shall be allocated to all shares of the Funds based on net asset
value, regardless of Class.
This
Agreement shall in all cases be interpreted in a manner consistent with the
requirements of Revenue Procedure 96-47, 1996-2 CB 338, and Revenue Procedure
99-40, I.R.B. 1999-46, 565 so as to avoid any possibility that a Fund is deemed
to have paid a preferential dividend. In the event of any conflict
between any other term of this Agreement and this Section (4), this Section (4)
shall control.
* * *
NEW YORK
LIFE INVESTMENT MANAGEMENT LLC
By: /s/ Xxxxx X.
Xxxxx
Xxxxx X.
Xxxxx
Executive
Vice President
ACKNOWLEDGED:
THE
MAINSTAY FUNDS
By: /s/ Xxxxxxx X.
Xxxxxx
Xxxxxxx
X. Xxxxxx
President
