RCM STRATEGIC GLOBAL GOVERNMENT FUND, INC.
INTERIM INVESTMENT MANAGEMENT AGREEMENT
INTERIM AGREEMENT, made as of this 23rd day of July, 2001
between RCM Strategic Global Government Fund, Inc., a Maryland
corporation (the "Fund") and Dresdner RCM Global Investors LLC,
a Delaware limited liability company (the "Manager").
WITNESSETH:
WHEREAS, the Fund is a non-diversified closed-end
management investment company registered under the Investment
Company Act of 1940, as amended, and the rules and regulations
thereunder (the "1940 Act"); and
WHEREAS, the Fund has been organized for the purpose of
investing its funds and desires to avail itself of the
experience, sources of information, advice, assistance and
facilities available to the Manager and to have the Manager
perform for it various investment management services; and the
Manager is willing to furnish the investment management
services sought by the Fund on the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and
mutual covenants herein contained, it is agreed as follows:
1. The Fund hereby appoints the Manager to act as
Investment Manager to the Fund on the terms set forth in
this Interim Agreement. The Manager accepts such
appointment and agrees to render the services herein
described, for the compensation herein provided.
2. Subject to the supervision of the Board of
Directors of the Fund (the "Board") and to the express
provisions and limitations set forth in the Fund's
Articles of Incorporation, By-Laws, and Form N-2
Registration Statement under the 1940 Act and the 1933
Act (the "Registration Statement"), each as it may be
amended from time to time, the Manager shall have full
discretionary authority to manage the investment and
reinvestment of the Fund's assets and to provide
investment research advice and supervision of the Fund's
portfolio in accordance with the Fund's investment
objectives, policies and restrictions as stated in the
Fund's Registration Statement, as such Registration
Statement may be amended from time to time. The services
to be provided under this paragraph 2 shall be subject to
the following understandings:
(a) The Manager shall provide supervision of the Fund's
investments and shall determine from time to time the
investments or securities that will be purchased,
retained, sold or loaned by the Fund, and the portion
of the assets that will be invested in securities or
otherwise. Subject to the limitations in this Section
2, the Manager is empowered hereby, through any of its
principals or employees, to take any of the following
actions for the benefit of the Fund:
(i) to invest and reinvest in stocks, bonds,
notes, trade acceptances, commercial paper,
structured instruments, and other obligations of
every description issued or incurred by
governmental or quasi-governmental bodies or their
agencies, authorities or instrumentalities, or by
corporations, trusts, associations, partnerships,
or other firms or entities;
(ii) to invest and reinvest in loans and deposits
at interest on call or on time, whether or not
secured by collateral;
(iii) to purchase and sell put and call options,
financial futures and put and call options on
such financial futures, and to enter into
transactions with respect to swaps, caps,
floors, and other similar instruments.
(iv) to purchase and sell foreign currency and
forward contracts on such foreign currency;
(v) to lend the Fund's portfolio securities to
brokers, dealers, other financial institutions, or
other parties, and to engage in repurchase and
reverse repurchase transactions with such entities;
(vi) to buy, sell, or exercise rights and warrants
to subscribe for stock or other securities;
(vii) to execute agreements with broker-dealers,
banks, futures commission merchants, and other
financial institutions on behalf of the Fund for
the purpose of entering into any of the foregoing
transactions;
(viii) to purchase, sell, and otherwise enter
into transactions with respect to any instrument
not described above that may be considered a
"derivative" instrument;
(ix) to engage in transactions with respect to any
other instruments, or to take any other actions
with respect to the Fund's investments, that the
Fund is authorized to invest in or to take pursuant
to the Registration Statement; and
(x) to take such other actions, or to direct the
Custodian to take such other actions, as may be
necessary or desirable to carry out the purpose and
intent of this subparagraph (a) of this paragraph
(2).
In determining the investments or securities
to be purchased or sold by the Fund, the Manager
shall place orders with respect to such instruments
either directly with the issuer or in such markets
and through such underwriters, dealers, brokers, or
futures commission merchants (collectively,
"brokers") as in the Manager's best judgment offer
the most favorable price and market for the
execution of each transaction; provided, however,
that, to the extent permitted under the Securities
Exchange Act of 1934, as amended, and the rules and
regulations thereunder (the "Exchange Act") and the
1940 Act, the Manager may cause the Fund to place
orders for transactions with brokers that furnish
brokerage and research services, as defined in the
1934 Act, to the Manager or any affiliated person
of the Manager, subject to such policies as the
Board may adopt from time to time with respect to
the extent and continuation of this practice. The
Fund understands and agrees that the Manager may
effect transactions in portfolio securities through
brokers who may charge an amount in excess of the
amount of commission another broker would have
charged, provided that the Manager determines in
good faith that such amount of commission is
reasonable in relation to the value of the
brokerage and research services provided by such
broker, viewed in terms of either the specific
transaction or the Manager's overall
responsibilities to the Fund and other clients as
to which the Manager or any affiliated person of
the Manager exercises discretionary investment
authority. Receipt by the Manager or any
affiliated person of the Manager of any such
brokerage research services shall not give rise to
any requirement for abatement or reduction of the
advisory fee payable by the Fund to the Manager
under this Interim Agreement. It is understood
that the services provided by such brokerage firms
may be useful to the Manager or its affiliated
persons in connection with their services to other
clients. The Fund agrees that any entity or person
associated with the Manager or any affiliated
person of the Manager which is a member of a
national securities exchange is authorized to
effect any transaction on such exchange for the
account of the Fund which is permitted by Section
11(a) of the 1934 Act, and Rule 11a2-2(T)
thereunder, and the Fund hereby consents to the
retention of compensation for such transactions in
accordance with Rule 11a2-2(T)(2)(iv).
(b) The Manager agrees to furnish suitable office space
for the Fund.
(c) The Manager shall use its best judgment in the
performance of its duties under this Interim
Agreement.
(d) The Manager undertakes to perform its duties and
obligations under this Interim Agreement in
conformity with the Registration Statement, with
the requirements of the 1940 Act and all other
applicable Federal and state laws and regulations
and with the instructions and directions of the
Fund's Board of Directors, all as may be amended or
modified from time to time.
(e) The Manager shall maintain books and records with
respect to the Fund's portfolio transactions and
the Manager shall render to the Fund's Board such
periodic and special reports as the Board of
Directors may reasonably request from time to time.
The Manager agrees that all records that it
maintains for the Fund are the property of the Fund
and it will surrender promptly to the Fund any of
such records upon the Fund's request.
(f) The Fund understands and agrees:
(i) that the Manager performs investment
management services for various clients and that
the Manager may take action with respect to any of
its other clients which may differ from action
taken or from the timing or nature of actions taken
with respect to the Fund, so long as it is the
Manager's policy, to the extent reasonably
practical, to allocate investment opportunities to
the Fund over time on a fair and equitable basis
relative to other clients;
(ii) that the Manager shall have no obligation to
purchase or sell for the Fund any security that the
Manager, or its principals or employees, may
purchase or sell for their own accounts or for the
account of any other client, if, in the opinion of
the Manager, such transaction or investment appears
unsuitable, impractical or undesirable for the
Fund; and
(iii) that, to the extent permitted by applicable
laws and regulations, on occasions when the Manager
deems the purchase or sale of a security or other
instrument to be in the best interests of the Fund
as well as of the other clients of the Manager, the
Manager may aggregate the securities to be so sold
or purchased when the Manager believes that to do
so would be in the best interests of the Fund. In
such event, allocation of the securities or other
instruments so purchased or sold, as well as the
expenses incurred in that transaction, shall be
made by the Manager in the manner the Manager
considers to be the most equitable and consistent
with its fiduciary obligations to the Fund and such
other clients.
3. The Manager will bear all of the expenses related
to salaries of its employees and to the Manager's
overhead in connection with its duties under this Interim
Agreement. The Manager also will pay all directors' fees
and salaries of the Fund's directors and officers who are
affiliated persons (as such term is defined in the 0000
Xxx) of the Manager.
Except for the expenses specifically assumed by the
Manager, the Fund will pay all of its expenses,
including, without limitation, fees of the directors not
affiliated with the Manager and board meeting expenses;
fees of the Manager; fees of the Fund's Administrator;
interest charges; taxes; charges and expenses of the
Fund's legal counsel and independent accountants, and of
the transfer agent, registrar and dividend reinvestment
and disbursing agent of the Fund; expenses of
repurchasing shares of the Fund; expenses of printing and
mailing share certificates, stockholder reports, notices,
proxy statements and reports to governmental offices;
brokerage and other expenses connected with the
execution, recording and settlement of portfolio security
transactions; expenses connected with negotiating,
effecting purchases or sales or registering privately
issued portfolio securities; fees and expenses of the
Fund's custodian and sub-custodians for all services to
the Fund, including safekeeping of funds and securities
and maintaining required books and accounts; expenses of
calculating and publishing the net asset value of the
Fund's shares; expenses of membership in investment
company associations; premiums and other costs associated
with the acquisition of a mutual fund directors and
officers errors and omissions liability insurance policy;
expenses of fidelity bonding and other insurance
premiums; expenses of stockholders' meeting; SEC and
state blue sky registration fees; New York Stock Exchange
listing fees; any fees payable by the Fund to the
National Association of Securities Dealers, Inc. in
connection with this offering; and its other business and
operating expenses.
4. For the services provided and the expenses assumed
pursuant to this Interim Agreement, the Fund will pay to
the Manager a monthly fee in arrears equal to 0.95% per
annum of the Fund's average daily net assets during the
month. The Fund authorizes the Manager to charge the
Fund for the full amount of fees as they become due and
payable pursuant to this paragraph 4; provided, however,
that copies of the fee statement relating to said payment
shall be sent to the Custodian and to the Fund.
In the event that expenses of the Fund for any
fiscal year should exceed the expense limitation on
investment company expenses imposed by any statute or
regulatory authority of any jurisdiction in which shares
of the Fund are qualified for offer and sale, the
compensation due the Manager for such fiscal year shall
be reduced by the amount of such excess by a reduction or
refund thereof. In the event that the expenses of the
Fund exceed any expense limitation which the Manager may,
by written notice to the Fund, voluntarily declare to be
effective with respect to the Fund, subject to such terms
and conditions as the Manager may prescribe in such
notice, the compensation due the Manager shall be
reduced, and, if necessary, the Manager shall bear the
Fund's expenses to the extent required by such expense
limitation.
If the Manager shall serve for less than the whole
of a month, the foregoing compensation shall be prorated.
All management fees earned hereunder shall be held
in an escrow account with the Fund's custodian.
a) If a majority of the Fund's outstanding voting
securities approve a new investment management
agreement within the 150 day period from the date
hereof, the fees held in the escrow account will be
paid to the Investment Manager.
b) If a majority of the Fund's outstanding voting
securities do not approve a new investment management
agreement with the Investment Manager, the Investment
Manager will be paid, out of the escrow account, the
lesser of:
Any costs incurred in performing this Interim
Agreement (plus interest earned on that amount while in
escrow); or
The total amount in the escrow account (plus
interest earned).
5. The Manager shall authorize and permit any of its
directors, officers and employees who may be elected as
directors or officers of the Fund to serve in the
capacities in which they are elected.
6. The Manager shall not be liable to the Fund or any
of its stockholders for any error of judgment, mistake of
law, or any loss suffered by the Fund or any of its
stockholders in connection with any act or omission in
the performance of its obligations to the Fund or to
which this Interim Agreement relates, except a loss
resulting from willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties
or from reckless disregard by it of its obligations and
duties under this Interim Agreement.
7. This Interim Agreement shall continue in effect
until a new investment management agreement is approved
by a vote of a majority (as defined in the 0000 Xxx) of
the outstanding voting securities of the Fund, but in no
event, shall this agreement have a duration greater than
150 days from its effective date, if not sooner
terminated. This Agreement may be terminated at any
time, without payment of any penalty, by the Board of
Directors of the Fund or by the vote of a majority (as
defined in the 0000 Xxx) of the outstanding voting
securities of the Fund on ten (10) days' written notice
to the Manager, or by the Manager on sixty (60) days'
written notice to the Fund. This Interim Agreement shall
terminate automatically in the event of its assignment
(as such term is defined in the 1940 Act and the rules
thereunder).
8. Nothing in this Interim Agreement shall limit or
restrict the right of any of the Manager's principals,
officers or employees who may also be a director, officer
or employee of the Fund to engage in any other business
or to devote his time and attention in part to management
or other aspects of any business, whether of a similar or
a dissimilar nature, nor limit or restrict the Manager's
right to engage in any other business or to render
services of any kind to any other corporation, investment
company, firm, individual or association. The investment
management services provided by the Manager hereunder are
not to be deemed exclusive, and the Manager shall be free
to render similar services to others.
9. Any notice or other communication required to be
given pursuant to this Interim Agreement shall be deemed
duly given if delivered or mailed by registered mail,
postage prepaid, (i) to the Manager at Xxxx Xxxxxxxxxxx
Xxxxxx, Xxx Xxxxxxxxx, XX 00000 or (ii) to the Fund at
Xxxx Xxxxxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000.
10. This Interim Agreement shall be governed by and
construed in accordance with the laws of the State of
California.
11. Under a License Agreement dated June 14, 1996, the
Fund was granted a royalty-free, non-exclusive license to
use the name "RCM" as part of its name only in connection
with the operation of an investment company. It is
further provided in the License Agreement that the term
"RCM" may be used or licensed in connection with other
investment companies, subject to the requirements of the
1940 Act, or any other business enterprise during the
term of such License Agreement or thereafter. The
License Agreement is terminable on sixty days' notice to
the Fund or as soon as practicable thereafter. Upon such
termination, the Fund is required to change its name to
one which does not include the term "RCM".
IN WITNESS WHEREOF, the parties hereto have caused
this instrument to be executed by their officers
designated below as of the day and year first above
written.
RCM STRATEGIC
GLOBAL
GOVERNMENT
FUND, INC.
Attest:
By: /s/ Xxxxx X. Xxxxxxx By: /s/
Xxxx X. Xxxxxx
DRESDNER RCM
GLOBAL
INVESTORS LLC
Attest:
By: /s/ Xxxxx X. Xxxxxxx By:
/s/Xxxxxx X. Xxxxxxxxx
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