EXPENSE LIMITATION AGREEMENT
This EXPENSE LIMITATION AGREEMENT (the "Agreement") is effective as of
January 31, 2006 by and between Xxxxxxxxx Global Investors (North America),
Inc., a Delaware corporation (the "Adviser") and Xxxxxxxxx Global Funds (the
"Trust"), on behalf of the Xxxxxxxxx Japan-Asia Focus Fund series of the Trust
(the "Fund").
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 company of the series type, and the Fund is a series of the
Trust.
WHEREAS, the Trust and the Adviser have entered into an Investment
Advisory Agreement dated August 31, 2001 ("Advisory Agreement"), as amended by
letter agreements dated September 24, 2003, April 30, 2004, August 1, 2005 and
January 31, 2006 pursuant to which the Adviser provides 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 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
may otherwise be subject;
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 ordinary operating
expenses incurred by the Fund in any fiscal year, including but not limited to
investment advisory fees of the Adviser, but excluding any distribution and
service fees under Rule 12b-1 under the 1940 Act and/or shareholder service fees
as described in the then current registration statement offering shares of the
Fund and interest, taxes, brokerage commissions, other investment-related costs
and extraordinary expenses, such as litigation and other 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 Adviser to the extent
set forth in this Agreement.
1.2 Operating Expense Limit. The Operating Expense Limit in any year with
respect to the Fund shall be 1.75% (annualized) of the average daily net assets
of the Fund.
1.3 Duration of Operating Expense Limit. The Operating Expense Limit with
respect to the Fund shall remain in effect until July 31, 2010 unless renewed by
written agreement of the parties.
1.4 Method of Computation. To determine the Adviser's obligation with
respect to the Excess Amount, each day the Fund Operating Expenses for the Fund
shall be annualized. If the annualized Fund Operating Expenses for any day of
the Fund exceed the Operating Expense Limit of the Fund, the Adviser shall waive
or reduce its investment advisory fee or absorb the other Fund expenses in an
amount sufficient to pay that day's Excess Amount. The Trust may
offset amounts owed to the Fund pursuant to this Agreement against the advisory
fee payable to the Adviser.
2. REIMBURSEMENT OF FEE WAIVERS AND EXPENSE REIMBURSEMENTS.
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2.1 Reimbursement. If on any day during which the Advisory Agreement is in
effect, the estimated annualized Fund Operating Expenses of the Fund for that
day are less than the Operating Expense Limit, the Adviser shall be entitled,
until January 31, 2009, to reimbursement by the Fund of the investment advisory
fees waived or reduced, and any other expense reimbursements or similar payments
remitted by the Adviser to the Fund pursuant to Section 1 hereof (the
"Reimbursement Amount") during any prior period to the extent that the Funds'
annualized Operating Expenses plus the amount so reimbursed equals, for such
day, the Operating Expense Limit, provided that such amount paid to the Adviser
will in no event exceed the total Reimbursement Amount and will not include any
amounts previously reimbursed.
3. TERM AND TERMINATION OF AGREEMENT.
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The Agreement shall terminate either upon the termination of the
Advisory Agreement or on July 31, 2010. The obligation of the Adviser under
Section 1 of this Agreement shall survive the termination of the Agreement
solely as to expenses and obligations incurred prior to the date of such
termination.
4. MISCELLANEOUS.
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4.1 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.
4.2 Interpretation. Nothing herein contained shall be deemed to require the
Trust or the Fund to take any action contrary to the Trust's 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.
4.3 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 Agreement or the 1940 Act, shall have the same meaning as and be
resolved by reference to such Advisory Agreement or the 1940 Act.
4.4 Amendments. This Agreement may be amended only by a written agreement
signed by each of the parties hereto.
4.5 Assignment. This Agreement may be assigned to the successors in
interest of either party with the consent of the other party.
2
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.
XXXXXXXXX GLOBAL INVESTORS
(NORTH AMERICA) INC.
By: /s/ Xxxxxxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxxxxxx X. Xxxxxxxxx
Title: Corporate Secretary
XXXXXXXXX GLOBAL FUNDS
By: /s/ Xxxxxxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxxxxxx X. Xxxxxxxxx
Title: Secretary
