EXPENSE LIMITATION AGREEMENT
EXPENSE LIMITATION AGREEMENT, effective as of ______ by and between Xxxxxx
Capital US LLC (the "Adviser") and Xxxxxx Diversified Opportunities Fund (the
"Fund") (the "Agreement").
WHEREAS, the Fund is a Delaware statutory Trust organized under an Agreement
and Declaration of Trust, dated _______ (the "Declaration of Trust"), and is
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), as a closed-end management company;
WHEREAS, the Fund and the Adviser have entered into an Investment Advisory
Agreement dated _____________ (the "Advisory Agreement"), 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;
WHEREAS, the Fund 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 at or below the level to which the Fund would normally be
subject in order to maintain the Fund's expense ratio at the Maximum Annual
Operating Expense Limit (as hereinafter defined) specified in Schedule A
hereto;
NOW THEREFORE, the parties hereto agree as follows:
1. EXPENSE LIMITATION.
1.1. APPLICABLE EXPENSE LIMIT. To the extent that the aggregate expenses of
every character incurred by the Fund in any fiscal year, including but not
limited to investment advisory fees of the Adviser (but excluding any interest,
taxes, brokerage commissions, dividend and interest expenses on securities sold
short, acquired fund fees and expenses, incentive fees, and other non-routine
expenses not incurred in the ordinary course of the Fund's business) ("Fund
Operating Expenses"), exceed the Maximum Annual Operating Expense Limit, as
defined in Section 1.2 below, such excess amount (the "Excess Amount") shall be
the liability of the Adviser.
1.2. MAXIMUM ANNUAL OPERATING EXPENSE LIMIT. The Maximum Annual Operating
Expense Limit with respect to the Fund shall be the amount specified in
Schedule A based on a percentage of the average daily net assets of the Fund.
The Maximum Annual Operating Expense Limit for the Fund contemplates that
certain expenses for the Fund may be paid through the use of all or a portion
of brokerage commissions (or markups or markdowns) generated by the Fund.
1.3. METHOD OF COMPUTATION. To determine the Adviser's liability with respect
to the Excess Amount, each month the Fund Operating Expenses for the Fund shall
be annualized as of the last day of the month. If the annualized Fund Operating
Expenses for any month of the Fund exceed the Maximum Annual Operating Expense
Limit of the Fund, the Adviser shall first waive or reduce its investment
advisory fee for such month by an amount sufficient to reduce the annualized
Fund Operating Expenses to an amount no higher than the Maximum Annual
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Operating Expense Limit. If the amount of the waived or reduced investment
advisory fee for any such month is insufficient to pay the Excess Amount, the
Adviser may also remit to the Fund an amount that, together with the waived or
reduced investment advisory fee, is sufficient to pay such Excess Amount.
1.4. YEAR-END ADJUSTMENT. If necessary, on or before the last day of the first
month of each fiscal year (or the termination of this Agreement if sooner), an
adjustment payment shall be made by the appropriate party in order that the
amount of the investment advisory fees waived or reduced and other payments
remitted by the Adviser to the Fund with respect to the previous fiscal year
shall equal the Excess Amount for such fiscal year.
2. TERM AND TERMINATION OF AGREEMENT.
This Agreement shall continue in effect with respect to the Fund until the date
indicated on Schedule A ("Initial Term End Date") and shall thereafter continue
in effect from year to year for successive one-year periods, provided that this
Agreement may be terminated, without payment of any penalty, with respect to
the Fund:
(i) by the Fund, for any reason and at any time;
(ii) by the Adviser, for any reason, upon ninety (90) days' prior written notice
to the Fund at its principal place of business, such termination to be effective
as of the close of business on Initial Term End Date or as of the close of
business on the last day of the then-current one-year period; or at such earlier
time provided that such termination is approved by majority vote of the Trustees
and the Independent Trustees voting separately; and
(iii) by either party effective upon the effective date of the termination of
the Advisory Agreement for any reason.
3. MISCELLANEOUS.
3.1. 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.
3.2. INTERPRETATION. Nothing herein contained shall be deemed to require the
Fund to take any action contrary to the Fund'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 Fund's Board of Trustees of
its responsibility for and control of the conduct of the affairs of the Fund.
3.3. 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.
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3.4. ENFORCEABILITY. Any term or provision of this Agreement which is invalid
or unenforceable in any jurisdiction shall, as to such jurisdiction be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms or provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction.
3.5. GOVERNING LAW AND JURISDICTION. This Agreement shall be governed by and
construed in accordance with the substantive laws of the State of Delaware
without giving effect to the conflicts of law principles thereof, and the
parties consent to the jurisdiction of courts, both state or federal, in
Delaware, with respect to any dispute under this Agreement.
3.6. AMENDMENT. This Agreement may not be amended except pursuant to a writing
signed by the parties hereto and in accordance with the 1940 Act, when
applicable.
3.7. 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.
3.8. ENTIRE AGREEMENT. This Agreement, including any schedules hereto (each of
which is incorporated herein and made a part hereof by these references),
represents the entire agreement and understanding of the parties hereto, and
shall supersede any prior agreements.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by
their respective officers thereunto duly authorized, as of the day and year
first above written.
XXXXXX DIVERSIFIED OPPORTUNITIES FUND
______________________________________
Name: Xxxxxx X. Xxxxxxxxxx
Title: Vice President and Secretary
XXXXXX CAPITAL US LLC
______________________________________
Name:
Title:
SCHEDULE A
MAXIMUM ANNUAL OPERATING EXPENSE LIMIT
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NAME OF FUND MAXIMUM ANNUAL INITIAL TERM END DATE
OPERATING EXPENSE
LIMIT
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Xxxxxx Diversified 1.61% February 28, 2017
Opportunities Fund
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