Exhibit 23(h)(16)
EXPENSE LIMITATION AGREEMENT
NATIONWIDE MUTUAL FUNDS
EXPENSE LIMITATION AGREEMENT, effective as of March 1, 2001 by and between
VILLANOVA MUTUAL FUND CAPITAL TRUST (the "Investment Adviser") and NATIONWIDE
MUTUAL FUNDS (the "Trust"), an Ohio business trust, on behalf of each of the
funds listed on Exhibit A (each, a "Fund").
WHEREAS, the Trust is registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as an open end-diversified management company of
the series type, and each Fund is a series of the Trust; and
WHEREAS, the Trust and the Investment Adviser have entered into an
Investment Advisory Agreement (the "Advisory Agreement"), pursuant to which the
Investment Adviser will render investment advisory services to the Fund for
compensation based on the value of the average daily net assets of the Fund; and
WHEREAS, the Trust and the Investment Adviser have determined that it is
appropriate and in the best interests of the Fund and its shareholders to
maintain the expenses of the Fund at a level below the level to which the Fund
would normally be subject during its start-up period.
NOW, THEREFORE, the parties hereto agree as follows:
1. Expense Limitation.
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1.1. Applicable Expense Limit. To the extent that the aggregate expenses
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of every character incurred by a Fund in any fiscal year, including but not
limited to investment advisory fees of the Investment Adviser (but excluding
interest, taxes, brokerage commissions and other expenditures which are
capitalized in accordance with generally accepted accounting principles and
other extraordinary expenses not incurred in the ordinary course of the Fund's
business) ("Fund Operating Expenses"), exceed the Operating Expense Limit, as
defined in Section 1.2 below, such excess amount (the "Excess Amount") shall be
the liability of the Investment Adviser.
1.2. Operating Expense Limit. The Operating Expense Limit in any year
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shall be a percentage of the average daily net assets of each class of the Fund
as described in Exhibit A, or such other rate as may be agreed to in writing by
the parties. The parties hereby agree that Operating Expense Limit described in
Exhibit A will not be increased before the listed on Exhibit A
1.3. Method of Computation. To determine the Investment Adviser's
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liability with respect to the Excess Amount, each month the Fund Operating
Expenses shall be annualized as of the last day of the month for each class of a
Fund. If the annualized Fund Operating Expenses for any month exceed the
Operating Expense Limit of a Fund class, the Investment Adviser shall first
waive or reduce its advisory fee for such month by an amount sufficient to
reduce the annualized Fund Operating Expenses to an amount which does not exceed
the Operating Expense Limit. If the amount of the waived or reduced advisory
fee for any such month is insufficient to satisfy the Excess Amount, the
Investment Adviser may also remit to a Fund an
amount that, together with the waived or reduced advisory fee, is sufficient to
satisfy such Excess Amount.
1.4. Year-End Adjustment. If necessary, on or before the last day of the
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first month of each fiscal year, an adjustment payment shall be made by the
appropriate party in order that the amount of the advisory fees waived or
reduced and other payments remitted by the Investment Adviser to a Fund with
respect to the previous fiscal year shall equal the Excess Amount.
2. Term and Termination of Agreement.
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This Agreement shall continue in effect for a period of one year from the
date of its execution for any Fund covered by the Agreement initially and for an
initial one-year period for any Fund subsequently added to the Agreement and
from year to year thereafter provided such continuance is specifically approved
by a majority of the Trustees of the Trust who (i) 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 ("Non-Interested Trustees"), provided however, that the reimbursements
described in Section 2 will not continue to accrue for more than five years
after a Fund's commencement of operations. Notwithstanding the preceding
provisions, the parties hereby agree that the initial Operating Expense Limits
describe herein shall remain in place until at least the date listed on Exhibit
A.
3. Miscellaneous.
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3.1. Captions. The captions in this Agreement are included for convenience
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of reference only and in no other way define or delineate any of the provisions
hereof or otherwise affect their construction or effect.
3.2. Interpretation. Nothing herein contained shall be deemed to require
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the Trust or a Fund to take any action contrary to the Trust's Agreement and
Declaration of Trust or By-Laws, or any applicable statutory or regulatory
requirement to which it is subject or by which it is bound, or to 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.
3.3. Definitions. Any question of interpretation of any term or provision
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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 Agreement or the 1940 Act, shall have the same
meaning as and be resolved by reference to such Advisory Agreement or the 1940
Act.
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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NATIONWIDE MUTUAL FUNDS
By: XXXXXX X. XXXXXXX
VILLANOVA MUTUAL FUND CAPITAL TRUST
By: XXXXX X. XXXXXXXX
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EXHIBIT A
to the Expense Limitation Agreement between
NATIONWIDE MUTUAL FUNDS
and
VILLANOVA MUTUAL FUND CAPITAL TRUST
As of March 1, 2001
Name of Fund/Class Expense Limitation for Fund/Class*
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Nationwide Government Bond Fund
Class A 0.99%
Class B 1.64%
Class C 1.64%
Class D 0.79%
Gartmore Millennium Growth Fund
Class A 1.63%
Class B 2.23%
Class C 2.23%
Class D 1.30%
*Effective until at least March 1, 2002.
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