Common use of Existing Securities Clause in Contracts

Existing Securities. On the date PIMCO begins serving as the Fund’s sub-advisor, the Fund’s assets are expected to consist of certain securities (the “Existing Securities”) and cash investments. A list of the Existing Securities that are expected to be held by the Fund upon the commencement of PIMCO’s service as sub-advisor will be provided to the Sub-Advisor by the Advisor. The Advisor acknowledges and agrees that it may be in Trust’s and Fund’s best interest to retain the Existing Securities, but in order to comply with the investment objectives or strategies of the Fund, some or all of such assets may be liquidated at such times and in such manner as is deemed appropriate by the Sub-Advisor and the proceeds be invested in compliance with the investment objectives of the Fund. Consistent with its obligations under Section 6 of this Agreement, the Sub-Advisor will attempt to obtain “best execution” of the Fund’s sale of any Existing Securities. The Sub-Advisor will not be liable to the Advisor for the prices obtained in connection with any sale of the Existing Securities and the Advisor acknowledges that such prices may in fact be much lower or higher than the prices at which such Existing Securities are valued and/or carried in the Fund. The Sub-Advisor shall maintain a log of all Existing Securities transactions placed through all securities brokerage firms including the name of the firm, a description of each transaction, the date of each transaction and where applicable, the amount of commissions paid. The Sub-Advisor shall invest the proceeds from the sale of the assets, together with any assets remaining unsold, in accordance with the Investment Guidelines of the Fund as mutually established by the Sub-Advisor and the Advisor. In the event any Existing Securities cease to be compliant with the Investment Guidelines for the Fund, the Advisor acknowledges and agrees that the Sub-Advisor may continue to hold such assets without regard to the Investment Guidelines for the Fund.