GAMNA SERIES FUNDS, INC.
EXPENSE LIMITATION AGREEMENT
EXPENSE LIMITATION AGREEMENT, dated as of ____________, 1999, by and
between Groupama Asset Management N.A. ("Groupama") and GAMNA Series Funds, Inc.
(the "Company"), on behalf of each portfolio of the Company set forth in
Schedule A (each a "Portfolio", and collectively, the "Portfolios").
WHEREAS, the Company is a Maryland corporation and is registered under
the Investment Company Act of 1940, as amended (the "1940 Act"), as an open-end
management investment company; and
WHEREAS, the Company and Groupama have entered into an Investment
Advisory Agreement (the "Advisory Agreement"), pursuant to which Groupama will
render investment advisory services to each Portfolio for compensation based on
the value of the average daily net assets of each such Portfolio; and
WHEREAS, the Company and Groupama have determined that it is
appropriate and in the best interests of each Portfolio and its shareholders to
maintain certain expenses of each Portfolio at a level below the level to which
each such Portfolio would normally be subject.
NOW, THEREFORE, the parties hereto agree as follows:
1. EXPENSE LIMITATION.
1.1 APPLICABLE EXPENSE LIMIT. To the extent that the aggregate
expenses incurred by a Portfolio ("Portfolio Operating Expenses") in any one
year period beginning on ______________ (each, an "Applicable Year") exceed the
Operating Expense Limit, as defined in Section 1.2 below, such excess amount
(the "Excess Amount") shall be the liability of Groupama.
1.2 OPERATING EXPENSE LIMIT. The Operating Expense Limit in any
Applicable Year shall be as set forth in Schedule A as to each Portfolio, or
such other rate as may be agreed to in writing by the parties.
1.3 METHOD OF COMPUTATION. To determine Groupama's liability with
respect to the Excess Amount, each month the Portfolio Operating Expenses for
each Portfolio shall be annualized for the Applicable Year as of the last day of
the month. If such annualized Portfolio Operating Expenses for any month of a
Portfolio exceed the Operating Expense Limit of such
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Portfolio, Groupama shall first waive or reduce its investment advisory
management fee for such month by an amount sufficient to reduce the annualized
Portfolio Operating Expenses for the Applicable Year to an amount no higher than
the 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,
Groupama may also remit to the appropriate Portfolio or Portfolios an amount
that, together with the waived or reduced 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 Applicable 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 Groupama to the Portfolio or Portfolios
with respect to the previous Applicable Year shall equal the Excess Amount.
2. REIMBURSEMENT OF FEE WAIVERS AND EXPENSE REIMBURSEMENTS.
2.1 REIMBURSEMENT. If in any Applicable Year during which the Advisory
Agreement is still in effect, the estimated aggregate Portfolio Operating
Expenses of such Portfolio for the Applicable Year are less than the Operating
Expense Limit for that Applicable Year, subject to quarterly approval by the
Company's Board of Directors as provided in Section 2.2 below, Groupama shall be
entitled to reimbursement by such Portfolio, in whole or in part as provided
below, of the advisory fees waived or reduced and other payments remitted by
Groupama to such Portfolio pursuant to Section 1 hereof. The total amount of
reimbursement to which Groupama may be entitled (the "Reimbursement Amount")
shall equal, at any time, the sum of all investment advisory fees previously
waived or reduced by Groupama and all other payments remitted by Groupama to the
Portfolio, pursuant to Section 1 hereof, during any of the previous two (2)
Applicable Years, less any reimbursement previously paid by such Portfolio to
Groupama, pursuant to Sections 2.2 or 2.3 hereof, with respect to such waivers,
reductions, and payments. The Reimbursement Amount shall not include any
additional charges or fees whatsoever, including, e.g., interest accruable on
the Reimbursement Amount.
2.2 BOARD APPROVAL. No reimbursement shall be paid to Groupama
pursuant to this provision unless the Company's Board of Directors has
determined that the payment of such reimbursement is in the best interests of
the Portfolio or Portfolios and their shareholders. The Company's Board of
Directors shall determine quarterly in advance whether any reimbursement may be
paid to
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Groupama for the relevant succeeding quarterly period.
2.3 METHOD OF COMPUTATION. To determine each Portfolio's payments, if
any, to reimburse Groupama for the Reimbursement Amount, each month the
Portfolio Operating Expenses of each Portfolio shall be annualized for the
Applicable Year as of the last day of the month. If such annualized Portfolio
Operating Expenses of a Portfolio for any month are less than the Operating
Expense Limit of such Portfolio, such Portfolio, only with the prior approval of
the Board, shall pay to Groupama an amount sufficient to increase the annualized
Portfolio Operating Expenses of that Portfolio to an amount no greater than the
Operating Expense Limit of that Portfolio, provided that such amount paid to
Groupama will in no event exceed the total Reimbursement Amount. In the event
the Operating Expense Limit for a Portfolio is increased subsequent to an
Applicable Year in which Groupama becomes entitled to reimbursement hereunder
for fees waived or reduced or amounts otherwise remitted to that Portfolio, the
amount available to reimburse Groupama in accordance with this Section 2.3 shall
be calculated by reference to the Operating Expense Limit for that Portfolio in
effect at the time Groupama became entitled to receive such reimbursement,
rather than the subsequently increased Operating Expense Limit for that
Portfolio.
2.4 YEAR-END ADJUSTMENT. If necessary, on or before the last day of
the first month of each Applicable Year, an adjustment payment shall be made by
the appropriate party in order that the actual Portfolio Operating Expenses of a
Portfolio for the prior Applicable Year (including any reimbursement payments
hereunder with respect to such Applicable Year) do not exceed the Operating
Expense Limit.
3. TERM AND TERMINATION OF AGREEMENT.
This Agreement shall continue in effect until ____________, 2002 and
from year to year thereafter provided such continuance is specifically approved
by a majority of the Directors of the Company who (i) are not "interested
persons" of the Company 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 Directors"). Nevertheless, this
Agreement may be terminated by either party hereto, without payment of any
penalty, upon 90 days' prior written notice to the other party at its principal
place of business; provided that, in the case of termination by the Company,
such action shall be authorized by resolution of a majority of the
Non-Interested Directors of the Company or by a
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vote of a majority of the outstanding voting securities of the Company.
4. MISCELLANEOUS.
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. This Agreement shall be construed in accordance
with the laws of the State of New York. Nothing herein contained shall be deemed
to require the Company or any Portfolio to take any action contrary to the
Company's Declaration 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 Company's Board of Directors of its responsibility for and control
of the conduct of the affairs of the Company or the Portfolios.
4.3 DEFINITIONS. Any questions 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.
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.
GAMNA SERIES FUNDS, INC.
ON BEHALF OF ITS PORTFOLIOS
By:______________________________
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GROUPAMA ASSET MANAGEMENT N.A.
By:______________________________
SCHEDULE A
This Agreement relates to the Operating
following Portfolios of the Company: Expense
Limit
GAMNA FOCUS FUND 1.90% of NAV
