LMP Corporate Loan Fund Inc.
New SubAdvisory Agreement
SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT ("Agreement") is made this 1st day of
August, 2006, by and between Xxxx Xxxxx Partners Fund Advisor,
LLC, a Delaware limited liability company (the "Manager"),
and Citigroup Alternative Investments LLC, a Delaware limited
liability company (the "Subadviser").
WHEREAS, the Manager has been retained by Citigroup Investments
Corporate Loan Fund Inc. (the "Fund"), a registered management
investment company under the Investment Company Act of 1940,
as amended (the "1940 Act") to provide investment advisory,
management, and administrative services to the Fund; and
WHEREAS, the Manager wishes to engage the Subadviser to
provide certain investment advisory services to the Fund,
and the Subadviser is willing to furnish such services on
the terms and conditions hereinafter set forth;
NOW THEREFORE, in consideration of the promises and mutual
covenants herein contained, it is agreed as follows:
0.Xx accordance with and subject to the Management Agreement
between the Fund and the Manager (the "Management Agreement"),
the Manager hereby appoints the Subadviser to act as Subadviser
with respect to the Fund for the period and on the terms set
forth in this Agreement. The Subadviser accepts such appointment
and agrees to render the services herein set forth, for the
compensation herein provided.
2.The Manager shall cause the Subadviser to be kept fully
informed at all times with regard to the securities owned by
the Fund, its funds available, or to become available, for
investment, and generally as to the condition of the Fund's
affairs. Manager shall furnish the Subadviser with such other
documents and information with regard to the Fund's affairs as
the Subadviser may from time to time reasonably request.
3.(a)Subject to the supervision of the Fund's Board of Directors
(the "Board") and the Manager, Subadviser shall regularly
provide the Fund with respect to such portion of the Fund's
assets as shall be allocated to the Subadviser by the Manager
from time to time (the "Allocated Assets") with investment
research, advice, management and supervision and shall
furnish a continuous investment program for the Allocated
Assets consistent with the Fund's investment objectives,
policies and restrictions, as stated in the Fund's Prospectus
and Statement of Additional Information. The Subadviser shall,
with respect to the Allocated Assets, determine from time to
time what securities and other investments will be purchased,
retained, sold or exchanged by the Fund and what portion of
the Allocated Assets will be held in the various securities
and other investments in which the Fund invests, and shall
implement those decisions, all subject to the provisions of
the Fund's Articles of Incorporation and By-Laws (collectively,
the "Governing Documents"), the 1940 Act, and the applicable
rules and regulations promulgated thereunder by the Securities
and Exchange Commission (the "SEC") and interpretive guidance
issued thereunder by the SEC staff and any other applicable
federal and state law, as well as the investment objectives,
policies and restrictions of the Fund referred to above, and
any other specific policies adopted by the Board and disclosed
to the Subadviser. The Subadviser is authorized as the agent of
the Fund to give instructions with respect to the Allocated
Assets to the custodian of the Fund as to deliveries of securities
and other investments and payments of cash for the account of the
Fund. Subject to applicable provisions of the 1940 Act, the
investment program to be provided hereunder may entail the investment
of all or substantially all of the assets of the Fund in one or more
investment companies. The Subadviser will place orders pursuant to
ts investment determinations for the Fund either directly with
the issuer or with any broker or dealer, foreign currency dealer,
futures commission merchant or others selected by it. In
connection with the selection of such brokers or dealers and the
placing of such orders, subject to applicable law, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"))
to the Fund and/or the other accounts over which the Subadviser or
its affiliates exercise investment discretion. The Subadviser is
authorized to pay a broker or dealer who provides such brokerage
and research services a commission for executing a portfolio
transaction for the Fund which is in excess of the amount of
commission another broker or dealer would have charged for effecting
that transaction if the Subadviser 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 or dealer.
This determination may be viewed in terms of either that particular
transaction or the overall responsibilities which the Subadviser
and its affiliates have with respect to accounts over which they
exercise investment discretion. The Board may adopt policies and
procedures that modify and restrict the Subadviser's authority
regarding the execution of the Fund's portfolio transactions
provided herein. The Subadviser shall exercise voting rights,
rights to consent to corporate action and any other rights
pertaining to the Allocated Assets subject to such direction as
the Board may provide, and shall perform such other functions of
investment management and supervision as may be directed by the Board.
(b)The Fund hereby authorizes any entity or person associated with the
Subadviser which is a member of a national securities exchange to effect
any transaction on the exchange for the account of the Fund which is
permitted by Section 11(a) of the Exchange 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)(a)(2)(iv). Notwithstanding the foregoing,
the Subadviser agrees that it will not deal with itself,
or with members of the Board or any principal underwriter
of the Fund, as principals or agents in making purchases
or sales of securities or other property for the account of
the Fund, nor will it purchase any securities from an
underwriting or selling group in which the Subadviser or
its affiliates is participating, or arrange for purchases
and sales of securities between the Fund and another account
advised by the Subadviser or its affiliates, except in each
case as permitted by the 1940 Act and in accordance with such
policies and procedures as may be adopted by the Fund from time
to time, and will comply with all other provisions of the
Governing Documents and the Fund's Prospectus and Statement
of Additional Information relative to the Subadviser and its
directors and officers.
4.The Subadviser may delegate to any other one or more companies
that the Subadviser controls, is controlled by, or is under
common control with, or to specified employees of any such
companies, certain of the Subadviser's duties under this
Agreement, provided in each case the Subadviser will supervise
the activities of each such entity or employees thereof, that
such delegation will not relieve the Subadviser of any of its
duties or obligations under this Agreement and provided further
that any such arrangements are entered into in accordance with
all applicable requirements of the 1940 Act.
5.The Subadviser agrees that it will keep records relating
to its services hereunder in accordance with all applicable
laws, and in compliance with the requirements of Rule 31a-3
under the 1940 Act, the Subadviser hereby agrees that any
records that it maintains for the Fund are the property of
the Fund, and further agrees to surrender promptly to the Fund
any of such records upon the Fund's request. The Subadviser
further agrees to arrange for the preservation of the records
required to be maintained by Rule 31a-1 under the 1940 Act
for the periods prescribed by Rule 31a-2 under the 1940 Act.
6.(a)The Subadviser, at its expense, shall supply the Board,
the officers of the Fund, and the Manager with all information
and reports reasonably required by them and reasonably available
to the Subadviser relating to the services provided by the
Subadviser hereunder.
(b)The Subadviser shall bear all expenses, and shall furnish all
necessary services, facilities and personnel, in connection with its
responsibilities under this Agreement. Other than as herein
specifically indicated, the Subadviser shall not be responsible for
the Fund's expenses, including, without limitation, advisory fees;
distribution fees; interest; taxes; governmental fees; voluntary
assessments and other expenses incurred in connection with
membership in investment company organizations; organization
costs of the Fund; the cost (including brokerage commissions,
transaction fees or charges, if any) in connection with the
purchase or sale of the Fund's securities and other investments
and any losses in connection therewith; fees and expenses of
custodians, transfer agents, registrars, independent pricing
vendors or other agents; legal expenses; loan commitment fees;
expenses relating to share certificates; expenses relating to
the issuing and redemption or repurchase of the Fund's shares
and servicing shareholder accounts; expenses of registering
and qualifying the Fund's shares for sale under applicable
federal and state law; expenses of preparing, setting in print,
printing and distributing prospectuses and statements of
additional information and any supplements thereto, reports,
proxy statements, notices and dividends to the Fund's shareholders;
costs of stationery; website costs; costs of meetings of the Board
or any committee thereof, meetings of shareholders and other
meetings of the Fund; Board fees; audit fees; travel expenses
of officers, members of the Board and employees of the Fund,
if any; and the Fund's pro rata portion of premiums on any
fidelity bond and other insurance covering the Fund and its
officers, Board members and employees; litigation expenses and
any non-recurring or extraordinary expenses as may arise,
including, without limitation, those relating to actions,
suits or proceedings to which the Fund is a party and the
legal obligation which the Fund may have to indemnify the
Fund's Board members and officers with respect thereto.
0.Xx member of the Board, officer or employee of the Fund
shall receive from the Fund any salary or other compensation
as such member of the Board, officer or employee while he is
at the same time a director, officer, or employee of the
Subadviser or any affiliated company of the Subadviser, except
as the Board may decide. This paragraph shall not apply to
Board members, executive committee members, consultants and
other persons who are not regular members of the Subadviser's
or any affiliated company's staff.
0.Xx compensation for the services performed by the Subadviser,
including the services of any consultants retained by the Subadviser,
the Manager shall pay the Subadviser out of the management fee it
receives with respect to the Fund, and only to the extent thereof,
as promptly as possible after the last day of each month, a fee,
computed daily at an annual rate set forth on Schedule A annexed
hereto. The first payment of the fee shall be made as promptly as
possible at the end of the month succeeding the effective date of
this Agreement, and shall constitute a full payment of the fee due
the Subadviser for all services prior to that date. If this Agreement
is terminated as of any date not the last day of a month, such
fee shall be paid as promptly as possible after such date of
termination, shall be based on the average daily net assets of
the Fund or, if less, the portion thereof comprising the
Allocated Assets in that period from the beginning of such
month to such date of termination, and shall be that
proportion of such average daily net assets as the number
of business days in such period bears to the number of
business days in such month. The average daily net assets
of the Fund or the portion thereof comprising the Allocated
Assets shall in all cases be based only on business days and be
computed as of the time of the regular close of business of the New
York Stock Exchange, or such other time as may be determined by the Board.
9.The Subadviser assumes no responsibility under this Agreement other
than to render the services called for hereunder, in good faith, and
shall not be liable for any error of judgment or mistake of law, or
for any loss arising out of any investment or for any act or omission
in the execution of securities transactions for the Fund, provided
that nothing in this Agreement shall protect the Subadviser against
any liability to the Manager or the Fund to which the Subadviser
would otherwise be subject by reason of willful misfeasance, bad
faith, or gross negligence in the performance of its duties or by
reason of its reckless disregard of its obligations and duties hereunder.
As used in this Section 9, the term "Subadviser" shall include any
affiliates of the Subadviser performing services for the Fund
contemplated hereby and the partners, shareholders, directors,
officers and employees of the Subadviser and such affiliates.
10.Nothing in this Agreement shall limit or restrict the right of
any director, officer, or employee of the Subadviser who may
also be a Board member, officer, or employee of the Fund, to
engage in any other business or to devote his time and attention
in part to the management or other aspects of any other business,
whether of a similar nature or a dissimilar nature, nor to limit
or restrict the right of the Subadviser to engage in any other
business or to render services of any kind, including investment
advisory and management services, to any other fund, firm,
individual or association. If the purchase or sale of securities
consistent with the investment policies of the Fund or one or
more other accounts of the Subadviser is considered at or about
the same time, transactions in such securities will be allocated
among the accounts in a manner deemed equitable by the Subadviser.
Such transactions may be combined, in accordance with applicable
laws and regulations, and consistent with the Subadviser's policies
and procedures as presented to the Board from time to time.
11.For the purposes of this Agreement, the Fund's "net assets"
shall be determined as provided in the Fund's Prospectus and
Statement of Additional Information and the terms "assignment,"
"interested person," and "majority of the outstanding voting
securities" shall have the meanings given to them by Section
2(a) of the 1940 Act, subject to such exemptions as may be
granted by the SEC by any rule, regulation or order.
12.This Agreement will become effective with respect to the
Fund on the date set forth opposite the Fund's name on
Schedule A annexed hereto, provided that it shall have
been approved by the Fund's Board and, if so required by
the 1940 Act, by the shareholders of the Fund in accordance
with the requirements of the 1940 Act and, unless sooner
terminated as provided herein, will continue in effect
through November 30, 2007. Thereafter, if not terminated,
this Agreement shall continue in effect with respect to the
Fund, so long as such continuance is specifically approved
t least annually (i) by the Board or (ii) by a vote of a
majority of the outstanding voting securities of the Fund,
provided that in either event the continuance is also
approved by a majority of the Board members who are not
interested persons of any party to this Agreement, by vote
cast in person at a meeting called for the purpose of voting
on such approval.
13.This Agreement is terminable with respect to the Fund without
penalty by the Board or by vote of a majority of the outstanding
voting securities of the Fund, in each case on not more than 60 days'
nor less than 30 days' written notice to the Subadviser, or by the
Subadviser upon not less than 90 days' written notice to the Fund
and the Manager, and will be terminated upon the mutual written
consent of the Manager and the Subadviser. This Agreement shall
terminate automatically in the event of its assignment by the
Subadviser and shall not be assignable by the Manager without
the consent of the Subadviser.
14.The Subadviser agrees that for any claim by it against the Fund
in connection with this Agreement or the services rendered under this
Agreement, it shall look only to assets of the Fund for satisfaction
and that it shall have no claim against the assets of any other
portfolios of the Fund.
00.Xx provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument
in writing signed by the party against which enforcement of
the change, waiver, discharge or termination is sought, and
no material amendment of the Agreement shall be effective
until approved, if so required by the 1940 Act, by vote of
the holders of a majority of the Fund's outstanding voting securities.
16.This Agreement, and any supplemental terms contained on Annex
I hereto, if applicable, embodies the entire agreement and
understanding between the parties hereto, and supersedes all
prior agreements and understandings relating to the subject matter
hereof. Should any part of this Agreement be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby. This Agreement
shall be binding on and shall inure to the benefit of the
parties hereto and their respective successors.
17.This Agreement shall be construed and the provisions
thereof interpreted under and in accordance with the laws
of the State of New York.
[signature page to follow]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers thereunto
duly authorized.
XXXX XXXXX PARTNERS FUND ADVISOR, LLC
By: _______________________________
Name:
Title:
CITIGROUP ALTERNATIVE INVESTMENTS LLC
By: _______________________________
Name:
Title:
The foregoing is acknowledged:
The undersigned officer of the Fund has executed this
Agreement not individually but in his/her capacity as
an officer of the Fund. The Fund does not hereby undertake,
on behalf of the Fund or otherwise, any obligation to the Subadviser.
CITIGROUP INVESTMENTS CORPORATE LOAN FUND INC.
By: _______________________________
Name:
Title:
