<PAGE>
Exhibit (h)(4)(1)
Nicholas-Applegate Institutional Funds
600 West Broadway, 30th Floor
San Diego, California 92101
To Whom It May Concern:
This will confirm our agreement pursuant to which Nicholas-Applegate Capital
Management (the "Adviser") will waive its fees and absorb other operating
expenses of various series of the Nicholas-Applegate Institutional Funds so that
total operating expenses, excluding taxes, interest, brokerage and the expenses
incurred from the creation and operation of the Mauritius entity, do not exceed
the percentages set forth on the following page through March 31, 2001. In
subsequent years, overall operating expenses for each series will not fall below
the applicable percentage limitation until the Adviser has been fully reimbursed
for fees foregone and expenses paid under this Agreement, as each series will
reimburse the Adviser in subsequent years when operating expenses (before
reimbursement) are less than the applicable percentage limitation.
NICHOLAS-APPLEGATE CAPITAL MANAGEMENT
By:____________________________________
E. Blake Moore, Jr., General Counsel
Accepted and Agreed to this
10th day of July 2000
NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS
By:_______________________________________
E. Blake Moore, Jr., Secretary
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<TABLE>
<CAPTION>
EXPENSE LIMITATIONS
-------------------
<S> <C> <C>
Small Cap Growth Class I 1.17%
Class R 1.42%
Mid Cap Growth Class I 1.00%
Class R 1.25%
Large Cap Growth Class I 1.00%
Class R 1.25%
Value Class I 1.00%
Class R 1.25%
Emerging Countries Class I 1.65%
Class R 1.90%
International Core Growth Class I 1.40%
Class R 1.65%
High Quality Bond Class I 0.45%
Class R 0.70%
Mini Cap Growth Class I 1.56%
Global Technology Class I 1.40%
International Small Cap Class I 1.40%
Worldwide Growth Class I 1.35%
Global Growth & Income Class I 1.35%
Latin America Class I 1.65%
Pacific Rim Class I 1.40%
Convertible Class I 1.00%
Global Blue Chip Class I 1.20%
Global Health Care Class I 1.40%
High Yield Bond Class I 0.75%
Class R 1.00%
Short Intermediate Fixed Class I 0.35%
</TABLE>
