EX-99.(D)(2) 3 dex99d2.htm SUPPLEMENT TO AMENDED AND RESTATED INVESTMENT ADVISORY CONTRACT Supplement to Amended and Restated Investment Advisory Contract

Exhibit (d)(2)

SUPPLEMENT TO

INVESTMENT ADVISORY CONTRACT

PIMCO Funds

840 Newport Center Drive

Newport Beach, California 92660

February 26, 2008

Pacific Investment Management Company LLC

840 Newport Center Drive

Newport Beach, California 92660

 

RE: PIMCO RealRetirement 2010 Fund, PIMCO RealRetirement 2020 Fund, PIMCO RealRetirement 2030 Fund, PIMCO RealRetirement 2040 Fund, PIMCO RealRetirement 2050 Fund (collectively, the “RealRetirement Funds”), PIMCO Fundamental Advantage Total Return Strategy Fund, PIMCO Fundamental Advantage Tax Efficient Strategy Fund (together with the RealRetirement Funds, the “Funds”) and Private Account Portfolio Series: Money Market Portfolio (the “Portfolio”)

Dear Sirs:

As provided in the Investment Advisory Contract between PIMCO Funds (the “Trust”) and Pacific Investment Management Company LLC (the “Adviser”), dated May 5, 2000 (as restated August 19, 2003) (the “Contract”), the parties may amend the Contract to add additional series of the Trust, under the same terms and conditions as set forth in the Contract, and at a fee rate set forth in Exhibit A to the Contract, as may be amended from time to time.

As the RealRetirement Funds approach their target dates and their portfolios become more conservative, as specified in the RealRetirement Funds’ prospectus, the advisory fee for each RealRetirement Fund will periodically decrease over time in set intervals, as set forth in Exhibit A to the Contract.

The Portfolio will be offered only to other series of the Trust, including the Funds (each an “Investing Fund”), or series of other registered investment companies for which PIMCO serves as investment adviser. The Portfolio will not pay an investment advisory fee to PIMCO. By investing in the Portfolio, each Investing Fund agrees that 0.01% of the fee that each Investing Fund is currently obligated to pay PIMCO under the Contract (as indicated on Exhibit A), will be designated as compensation for the investment advisory services PIMCO provides to the Portfolio under the Contract.

The Trust, on behalf of the Funds, each other Investing Fund and the Portfolio, and the Adviser hereby agree to amend the Contract as of the date hereof to add the Funds and the Portfolio to Exhibit A and to specify the compensation arrangement associated with the Investing Funds’ investments in the Portfolio. Accordingly, the current Exhibit A is replaced with the new Exhibit A attached hereto.

The Declaration of Trust establishing the Trust, as amended and restated effective March 31, 2000, a copy of which, together with all amendments thereto (the “Declaration”), is on file in the Office of the Secretary of the Commonwealth of Massachusetts, provides that the name “PIMCO Funds” refers to the trustees under the Declaration collectively as trustees and not as individuals or personally, and that no shareholder, trustee, officer, employee or agent of the Trust shall be subject to claims against or obligations of the Trust to any extent whatsoever, but that the Trust estate only shall be liable.

EXHIBIT A

(as of February 26, 2008)

PIMCO Funds

 

Fund

    Investment
Advisory
Fee		  

All Asset Fund

    0.175 %

All Asset All Authority Fund

    0.20 %

California Intermediate Municipal Bond Fund

    0.225 %

California Short Duration Municipal Income Fund

    0.20 %

Commercial Mortgage Securities Fund

    0.40 %

CommodityRealReturn Strategy Fund

    0.49 %

Convertible Fund

    0.40 %

Developing Local Markets Fund

    0.45 %

Diversified Income Fund

    0.45 %

Emerging Local Bond Fund

    0.45 %

Emerging Markets Bond Fund

    0.45 %

European StocksPLUS TR Strategy Fund*

    0.45 %

Extended Duration Fund

    0.25 %

Far East (Ex-Japan) StocksPLUS TR Strategy Fund*

    0.45 %

Floating Income Fund

    0.30 %

Foreign Bond Fund (U.S. Dollar-Hedged)

    0.25 %

Foreign Bond Fund (Unhedged)

    0.25 %

Fundamental Advantage Tax Efficient Strategy Fund

    0.64 %

Fundamental Advantage Total Return Strategy Fund

    0.64 %

Fundamental IndexPLUS Fund

    0.45 %

Fundamental IndexPLUS TR Fund

    0.54 %

Global Bond Fund (Unhedged)

    0.25 %

Global Bond Fund (U.S. Dollar-Hedged)

    0.25 %

GNMA Fund

    0.25 %

High Yield Fund

    0.25 %

High Yield Municipal Bond Fund

    0.30 %

Income Fund

    0.25 %

International StocksPLUS TR Strategy Fund (U.S. Dollar-Hedged)*

    0.45 %

International StocksPLUS TR Strategy Fund (Unhedged)*

    0.39 %

Investment Grade Corporate Bond Fund

    0.25 %

Japanese StocksPLUS TR Strategy Fund*

    0.45 %

Liquid Assets Fund

    0.10 %

Loan Obligation Fund

    0.25 %

Long Duration Fund

    0.25 %

Long Duration Total Return Fund

    0.25 %

Long-Term U.S. Government Fund

    0.225 %

Low Duration Fund

    0.25 %

Low Duration Fund II

    0.25 %

Low Duration Fund III

    0.25 %

Moderate Duration Fund

    0.25 %

Money Market Fund

    0.12 %

Mortgage-Backed Securities Fund

    0.25 %

Municipal Bond Fund

    0.225 %

New York Municipal Bond Fund

    0.225 %

Real Return Fund

    0.25 %

Real Return Asset Fund

    0.35 %

RealEstateRealReturn Strategy Fund

    0.49 %

RealRetirement 2010 Fund

    0.70 %

RealRetirement 2020 Fund

    0.70 %

RealRetirement 2030 Fund(1)

    0.75 %

RealRetirement 2040 Fund(2)

    0.80 %

RealRetirement 2050 Fund(3)

    0.80 %

Short Duration Municipal Income Fund

    0.20 %

Short-Term Fund

    0.25 %

Small Cap StocksPLUS TR Fund*

    0.44 %

StocksPLUS Fund*

    0.25 %

StocksPLUS Long Duration Fund

    0.35 %

StocksPLUS Municipal-Backed Fund*

    0.34 %

StocksPLUS TR Short Strategy Fund*

    0.44 %

StocksPLUS Total Return Fund*

    0.39 %

Total Return Fund

    0.25 %

Total Return Fund II

    0.25 %

Total Return Fund III

    0.25 %

Private Account Portfolio Series

 

Portfolio

    Investment
Advisory
Fee		  

Asset-Backed Securities Portfolio

    0.02 %

Asset-Backed Securities Portfolio II

    0.02 %

Developing Local Markets Portfolio

    0.02 %

Emerging Markets Portfolio

    0.02 %

High Yield Portfolio

    0.02 %

International Portfolio

    0.02 %

Investment Grade Corporate Portfolio

    0.02 %

Mortgage Portfolio

    0.02 %

Mortgage Portfolio II

    0.02 %

Money Market Portfolio(4)

    0.00 %

Municipal Sector Portfolio

    0.02 %

Opportunity Portfolio

    0.02 %

Real Return Portfolio

    0.02 %

Short-Term Portfolio

    0.02 %

Short-Term Portfolio II

    0.02 %

U.S. Government Sector Portfolio

    0.02 %

U.S. Government Sector Portfolio II

    0.02 %

 

* Reflects a fee reduction effective October 1, 2007.

 

(1) Effective April 1, 2015, the Fund’s investment advisory fee will be reduced to 0.70%.

 

(2) Effective April 1, 2015, the Fund’s investment advisory fee will be reduced to 0.75%. Effective April 1, 2025, the Fund’s investment advisory fee will be further reduced to 0.70%.

 

(3) Effective April 1, 2025, the Fund’s investment advisory fee will be reduced to 0.75%. Effective April 1, 2035, the Fund’s investment advisory fee will be further reduced to 0.70%.

 

(4) Money Market Portfolio will be offered only to other series of the PIMCO Funds (each an “Investing Fund”) or other series of registered investment companies for which PIMCO serves as investment adviser. Money Market Portfolio does not pay an investment advisory fee to PIMCO. By investing in the Money Market Portfolio, each Investing Fund agrees that 0.01% of the fee that each Investing Fund is currently obligated to pay PIMCO as indicated on this Exhibit A, will be designated as compensation for the investment advisory services PIMCO provides to Money Market Portfolio under the Contract.

If the foregoing correctly sets forth the Contract between the Trust and the Adviser, please so indicate by signing, dating and returning to the Trust the enclosed copy hereof.

 

Very truly yours,
PIMCO FUNDS
By:   /S/    Ernest L. Schmider
Title:   President
Date: February 26, 2008

 

ACCEPTED:
PACIFIC INVESTMENT MANAGEMENT COMPANY LLC
By:   /S/    Ernest L. Schmider
Title:   Managing Director
Date: February 26, 2008
PIMCO FUNDS
By:   /S/    Ernest L. Schmider
Title:   President
Date: February 26, 2008