November 28, 2009 Board of Directors Eclipse Funds Inc. New York, NY 10010 Re: Expense Limitation Agreement MainStay Intermediate Term Bond Fund Class I shares Dear Board of Directors:
Exhibit
h 3 f
November
28, 2009
Board of
Directors
00
Xxxxxxx Xxxxxx
Xxx Xxxx,
XX 00000
MainStay
Intermediate Term Bond Fund
Class I
shares
Dear
Board of Directors:
(1) This
letter will confirm New York Life Investment Management LLC’s (“New York Life
Investments”) intent that in the event the annualized ratio of total ordinary
fund 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 fund in
which the Fund invests) to average daily net assets of the Class of the Fund
listed in the chart below, calculated daily in accordance with generally
accepted accounting principles consistently applied, exceeds the percentage
limitation set forth below, New York Life Investments will assume a portion of
the Fund’s operating expenses in the amount of such excess:
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FUND/CLASS
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EXPENSE
LIMIT
|
|
MainStay
Intermediate Term Bond Fund
Class
I Shares
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0.60%
|
New York
Life Investments authorizes the Fund and the administrator to reduce New York
Life Investments’ monthly management fees or reimburse the monthly expenses of
the appropriate Class of the Fund to the extent necessary to effectuate the
limitations stated in this Section (1), consistent with the method set forth in
Section (4) below. New York Life Investments authorizes the Fund and
the administrator to request funds from New York Life Investments as necessary
to implement the limitations stated in this Section (1). New York
Life Investments will pay to the Fund or Class any such amounts, consistent with
the method set forth in Section (4) below, promptly after receipt of such
request.
(2) The
expense cap set forth in this Agreement is effective from November 28, 2009
through July 31, 2010.
(3) The
foregoing expense limitation supersedes 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) New York Life
Investments shall be reimbursed by the respective Fund or Class 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 and/or Class shall establish a
credit to be used in reducing deductions and/or payments which would otherwise
be made in subsequent months of the year. New York Life Investments
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 within the
period that this Agreement is in effect.
(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.
* * *
IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date written above.
NEW YORK
LIFE INVESTMENT MANAGEMENT LLC
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By:
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/s/
Xxxxx X. Xxxxx
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Xxxxx
X. Xxxxx
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Executive
Vice President
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ACKNOWLEDGED:
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By:
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/s/
Xxxxxxx X. Xxxxxx
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Xxxxxxx
X. Xxxxxx
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President
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