INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT,
dated as of ______, 2007, among DWS RREEF World Real Estate & Tactical
Strategies Fund, Inc., a Maryland corporation (the “Corporation” and the “Fund”), and Deutsche
Investment Management Americas Inc., a Delaware corporation (the “Adviser”).
WHEREAS, the Fund is registered as a closed-end, non-diversified management investment company
under the Investment Company Act of 1940, as amended (the “1940 Act”);
WHEREAS, the Corporation engages in the business of investing and reinvesting its assets in
accordance with the investment objectives, policies and restrictions specified in the currently
effective Prospectus (the “Prospectus”) and Statement of Additional Information (the “SAI”)
included in the Corporation’s Registration Statement on Form N-2, as amended from time to time (the
“Registration Statement”), filed by the Corporation under the Investment Company Act and the
Securities Act of 1933, as amended;
WHEREAS, the Adviser is engaged principally in rendering investment management services and is
registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the
“Advisers Act”);
WHEREAS, the Corporation desires to retain the Adviser to provide it with investment
management services on the terms set out in this Agreement, and the Adviser is willing to provide
investment management services to the Fund on the terms set out in this Agreement; and
NOW, THEREFORE, in consideration of the premises and the covenants contained in this
Agreement, the Corporation and the Adviser agree as follows:
1. Appointment and Services.
(a) The Corporation appoints the Adviser to act as investment manager to each Fund.
The Adviser accepts its appointment and agrees to provide the services set out in this
Agreement for the compensation set out in this Agreement.
(b) Subject to the terms of this Agreement, and the supervision of the Board of
Directors, the Adviser will provide continuing investment management of the assets of each
Fund in accordance with the investment objectives, policies and restrictions set forth in
the Prospectus and SAI of the Fund; the applicable provisions of the Investment Company Act,
the rules and regulations thereunder; the provisions of the Internal Revenue Code of 1986,
as amended (the “Code”), relating to regulated investment companies and all rules and
regulations thereunder; and all other applicable federal and state laws and regulations. In
connection with the services provided under this Agreement, the Adviser will use best
efforts to manage the Fund so that it will qualify as a regulated investment company under
Subchapter M of the Code and regulations issued under the Code. The Adviser will also
monitor, to the extent not monitored by the Fund’s administrator or other agent, the Fund’s
compliance with its investment and tax guidelines and other compliance policies. The Fund
will have the benefit of the investment analysis and research, the review of current
economic conditions and trends and the consideration of long-range investment policy
generally available to the Adviser’s investment advisory
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clients. In managing the Fund in accordance with the
requirements set out in this Section 1, the Adviser will be entitled to receive and act upon
advice of counsel for the Corporation.
(c) The Adviser will determine the securities and other instruments to be purchased,
sold or entered into by the Fund and place orders with broker-dealers, foreign currency
dealers, futures commission merchants or others pursuant to the Adviser’s determinations and
all in accordance with the policies as set out in the Prospectus and SAI of the Fund or as
adopted by the Board of Directors and disclosed to the Adviser. The Adviser will determine
what portion of the Fund’s portfolio will be invested in securities and other assets and
what portion, if any, should be held uninvested in cash or cash equivalents.
(d) The Adviser will provide assistance to the Board of Directors in valuing the
securities and other instruments held by the Fund, to the extent reasonably required by such
valuation policies and procedures as may be adopted by the Fund.
(e) The Adviser will maintain in accordance with applicable law all books and records
required of investment advisers under the Advisers Act, and will make available to the Board
of Directors such records upon request.
(f) The Adviser also agrees to make available to the Board of Directors the following:
(i) periodic reports on the investment performance
of the Fund;
(ii) additional reports and information related to
the Adviser’s duties under this Agreement as the Board of Directors may
reasonably request; and
(iii) to the extent held by the Adviser, all of the Fund’s investment
records and ledgers as are necessary to assist the Corporation in complying
with the requirements of the Investment Company Act and other applicable
laws.
To the extent required by law, the Adviser will furnish to regulatory authorities
having the requisite authority any information or reports in connection with the services
provided under this Agreement that may be requested.
(g) The Adviser will also provide to the Fund’s administrator, custodian, fund
accounting agent, shareholder service agents, transfer agents and other service providers,
as required, and to the extent held by the Adviser, information relating to all transactions
concerning the assets belonging to the Fund, in each case subject to compliance with
applicable privacy standards.
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2. Investment Management Fee.
(a) For all services to be rendered, payments to be made and costs to be assumed by the
Adviser as provided under this Agreement, the Corporation will pay the Adviser in United
States Dollars following the last day of each month the unpaid balance of a fee equal to the
sum of all the daily management accruals from the previous month. The daily management
accrual is calculated on a daily basis by multiplying a Fund’s prior day’s net assets by the
fee rates set forth on Schedule I to this Agreement and dividing that product by the number
of days in that year. The Adviser will be entitled to receive during any month such interim
payments of its fee under this Section 2 as it will request, provided that no such payment
will exceed 75 percent of the amount of its fee then accrued on the books of a Fund and
unpaid.
(b) The “average daily net assets” of the Fund will mean the average of the values
placed on the Fund’s net assets as of 4:00 p.m. (New York time) on each day on which the net
asset value of the Fund is determined consistent with the provisions of Rule 22c-1 under the
Investment Company Act or, if the Fund lawfully determines the value of its net assets as of
some other time on each business day, as of such time. The value of the net assets of each
Fund will always be determined pursuant to the applicable provisions of the Corporation’s
Articles of Incorporation, as amended from time-to-time (the “Articles”) and the
Registration Statement. If the determination of net asset value for a Fund does not take
place for any particular day, then for the purposes of this Section 2, the value of the net
assets of the Fund as last determined will be deemed to be the value of its net assets as of
4:00 p.m. (New York time), or as of such other time as the value of the net assets of the
Fund’s portfolio may be lawfully determined on that day. If a Fund determines the value of
the net assets of its portfolio more than once on any day, then the last such determination
thereof on that day will be deemed to be the sole determination thereof on that day for the
purposes of this Section 2.
(c) The Adviser may from time to time agree not to impose all or a portion of its fee
otherwise payable under this Agreement and/or undertake to pay or reimburse a Fund for all
or a portion of its expenses not otherwise required to be paid by or reimbursed by the
Adviser. Unless otherwise agreed, any fee reduction or undertaking may be discontinued or
modified by the Adviser at any time. For the month and year in which this Agreement becomes
effective or terminates, there will be an appropriate pro ration of any fee based on the
number of days that the Agreement is in effect during such month and year, respectively.
(d) All rights to compensation under this Agreement for services performed as of the
termination of this Agreement shall survive the termination.
3. Expenses.
(a) Except as otherwise specifically provided in this Section 3 or as determined by the
Board of Directors, to the extent permitted by applicable law, the Adviser will pay the
compensation and expenses of all Directors, officers and executive employees of the
Corporation (including a Fund’s share of payroll taxes) who are affiliated persons of the
Adviser, and the Adviser will make available, without expense to
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any Fund, the services of such of its directors, officers and employees as may duly be
elected officers of the Corporation, subject to their individual consent to serve and to any
limitations imposed by law. The Adviser will provide at its expense the services described
in this Agreement.
(b) The Adviser will not be required to pay any expenses of the Corporation or of a
Fund other than those specifically allocated to it in this Section 3. In particular, but
without limiting the generality of the foregoing, the Adviser will not be responsible,
except to the extent of the reasonable compensation of such of the Corporation’s Directors
and officers as are directors, officers or employees of the Adviser whose services may be
involved, for the following expenses of a Fund: fees payable to the Adviser; outside legal,
accounting or auditing expenses including with respect to expenses related to negotiation,
acquisition, or distribution of portfolio investments; maintenance of books and records
which are maintained by the Corporation, a Fund’s custodian or other agents of the
Corporation; taxes and governmental fees; fees and expenses of a Fund’s accounting agent,
custodians, sub-custodians, depositories (for securities and/or commodities), transfer
agents, dividend disbursing agents and registrars; payment for portfolio pricing or
valuation services to pricing agents, accountants, bankers and other specialists, if any;
brokerage commissions or other costs of acquiring or disposing of any portfolio securities
or other instruments of a Fund; and litigation expenses and other extraordinary expenses not
incurred in the ordinary course of a Fund’s business.
(c) The Adviser will not be required to pay expenses of any activity which is primarily
intended to result in sales of shares of a Fund (the “Shares”) if and to the extent that (i)
such expenses are required to be borne by a principal underwriter that acts as the
distributor of the Fund’s Shares pursuant to an underwriting agreement that provides that
the underwriter will assume some or all of such expenses, or (ii) the Corporation on behalf
of the Fund will have adopted a plan in conformity with Rule 12b-1 under the Investment
Company Act providing that the Fund (or some other party) will assume some or all of such
expenses. The Adviser will pay such sales expenses as are not required to be paid by the
principal underwriter pursuant to the underwriting agreement or are not permitted to be paid
by a Fund (or some other party) pursuant to such a plan.
4. Delegation of Investment Management Services. Subject to the prior approval of a majority
of the members of the Board of Directors, including a majority of the Directors who are not
“interested persons,” and, to the extent required by applicable law, by the shareholders of a Fund,
the Adviser may, through a sub-advisory agreement or other arrangement, delegate to a sub-advisor
any of the duties enumerated in this Agreement, including the management of all or a portion of the
assets being managed. Subject to the prior approval of a majority of the members of the Board of
Directors, including a majority of the Directors who are not “interested persons,” and, to the
extent required by applicable law, by the shareholders of a Fund, the Adviser may adjust such
duties, the portion of assets being managed, and the fees to be paid by the Adviser; provided, that
in each case the Adviser will continue to oversee the services provided by such company or
employees and any such delegation will not relieve the Adviser of any of its obligations under this
Agreement.
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5. Selection of Brokers and Affiliated Transactions.
(a) Subject to the policies established by, and any direction from the Corporation’s
Board of Directors, the Adviser will be responsible for selecting the brokers or dealers
that will execute the purchases and sales for a Fund. Subject to the foregoing, it is
understood that the Adviser will not be deemed to have acted unlawfully, or to have breached
a fiduciary duty to the Corporation or be in breach of any obligation owing to the
Corporation under this Agreement, or otherwise, solely by reason of its having directed a
securities transaction on behalf of a series to a broker-dealer in compliance with the
provisions of Section 28(e) of the Securities Exchange Act of 1934 or as otherwise permitted
from time to time by a series’ Prospectus and SAI.
(b) Subject to the policies established by, and any direction from, a Fund’s Board of
Directors, the Adviser may direct any of its affiliates to execute portfolio transactions
for a Fund on an agency basis. The commissions paid to the Adviser’s affiliates must be in
accordance with Rule 17e-1 under the Investment Company Act.
(c) The Adviser and any of its affiliates will not deal with a Corporation or any of
its affiliates in any transaction in which the Adviser or any of its affiliates acts as a
principal with respect to any part of a Fund order, except in compliance with the Investment
Company Act, the rules and regulations under the Investment Company Act and any applicable
SEC or SEC staff guidance or interpretation. If the Adviser or any of its affiliates is
participating in an underwriting or selling group, a Fund may not buy securities from the
group except in accordance with policies established by the Board of Directors in compliance
with the Investment Company Act, the rules and regulations under the Investment Company Act
and any applicable SEC or SEC staff guidance or interpretation.
(d) The Adviser will promptly communicate to a Fund’s administrator and to the officers
and the Directors of a Corporation such information relating to portfolio transactions as
they may reasonably request.
6. Limitation of Liability of Manager.
(a) As an inducement to the Adviser undertaking to provide services to the Corporation
pursuant to this Agreement, the Corporation agrees that the Adviser will not be liable under
this Agreement for any error of judgment or mistake of law or for any loss suffered by the
Corporation in connection with the matters to which this Agreement relates, provided that
nothing in this Agreement will be deemed to protect or purport to protect the Adviser
against any liability to the Corporation or its shareholders to which the Adviser 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 under this Agreement.
(b) The rights of exculpation provided under this Section 6 are not to be construed so
as to provide for exculpation of any person described in this Section for any liability
(including liability under U.S. federal securities laws that, under certain circumstances,
impose liability even on persons that act in good faith) to the extent (but
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only to the extent) that exculpation would be in violation of applicable law, but will be
construed so as to effectuate the applicable provisions of this Section 6 to the maximum
extent permitted by applicable law.
7. Term and Termination.
(a) This Agreement will remain in force with respect to each party until September 30,
2008 and continue in force from year to year thereafter, but only so long as such
continuance is specifically approved at least annually (a) by the vote of a majority of the
Directors who are not parties to this Agreement or “interested persons” of any party to this
Agreement, cast in person at a meeting called for the purpose of voting on such approval,
and (b) by the vote of a majority of the Directors of the Corporation, or by the vote of a
majority of the outstanding voting securities of the respective Fund. The requirement that
continuance of this Agreement be “specifically approved at least annually” will be construed
in a manner consistent with the Investment Company Act, the rules and regulations under the
Investment Company Act and any applicable SEC or SEC staff guidance or interpretation.
(b) This Agreement may be terminated with respect to a Fund at any time, without the
payment of any penalty, by the vote of a majority of the outstanding voting securities of
the Fund or by the Corporation’s Board of Directors on 60 days’ written notice to the
Adviser, or by the Adviser on 60 days’ written notice to the Corporation. This Agreement
will terminate automatically in the event of its assignment (as defined under the Investment
Company Act).
8. Amendment. No provision of this Agreement may be changed, waived, discharged, or
terminated orally, but only by an instrument in writing signed by the party against whom
enforcement of the change, waiver, discharge, or termination is sought, and no amendment of this
Agreement will be effective until approved in a manner consistent with the Investment Company Act,
rules and regulations under the Investment Company Act and any applicable SEC or SEC staff guidance
or interpretation.
9. Services Not Exclusive. The Adviser’s services to the Corporation pursuant to this
Agreement are not exclusive and it is understood that the Adviser may render investment advice,
management and services to other Persons (including other investment companies) and to engage in
other activities, so long as its services under this Agreement are not impaired by such other
activities. It is understood and agreed that officers or directors of the Adviser may serve as
officers or Directors of the Corporation, and that officers or Directors of the Corporation may
serve as officers or directors of the Adviser to the extent permitted by law; and that the officers
and directors of the Adviser are not prohibited from engaging in any other business activity or
from rendering services to any other person, or from serving as partners, officers, trustees or
directors of any other firm, trust or corporation, including other investment companies. Whenever
a Fund and one or more other accounts or investment companies advised by the Adviser have available
funds for investment, investments suitable and appropriate for each will be allocated in accordance
with procedures believed by the Adviser to be equitable to each entity over time. Similarly,
opportunities to sell securities will be allocated in a manner believed by the Adviser to be
equitable to each entity over time. The Corporation recognizes that in some cases
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this procedure may adversely affect the size of the position that may be acquired or disposed of
for a Fund.
10. Avoidance of Inconsistent Position. In connection with purchases or sales of portfolio
securities and other investments for the account of a Fund, neither the Adviser nor any of its
directors, officers, or employees will act as a principal or agent or receive any commission,
except in accordance with applicable law and policies and procedures adopted by the Board of
Directors. The Adviser or its agent will arrange for the placing of all orders for the purchase
and sale of portfolio securities and other investments for a Fund’s account with brokers or dealers
selected by it in accordance with Fund policies as expressed in the Registration Statement. If any
occasion should arise in which the Adviser gives any advice to its clients concerning the Shares of
a Fund, it will act solely as investment counsel for such clients and not in any way on behalf of
the Fund.
11. Reserved.
12. Delivery of Documents. Copies of the Registration Statement and the Corporation’s
Prospectus and SAI have been furnished to the Adviser by the Corporation. The Corporation has also
furnished the Adviser with copies properly certified or authenticated of each of the following
additional documents related to the Corporation:
(i) The Articles dated April 5, 2007 as amended and/or restated to date, together with all
filed certificates regarding the establishment and designation of a series of Shares of the
Corporation, to the extent applicable.
(ii) By-Laws of the Corporation as in effect on the date hereof.
(iii) Resolutions of the Directors of the Corporation approving the form of this Agreement.
The Corporation will promptly furnish the Adviser from time to time with copies, properly
certified or authenticated, of all amendments of or supplements, if any, to the foregoing,
including the Prospectus, the SAI and the Registration Statement.
13. Miscellaneous.
(a) The captions in this Agreement are included for convenience of reference only and
in no way define or limit any of the provisions hereof or otherwise affect their
construction or effect. This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original, but all of which together will
constitute one and the same instrument.
(b) Any question of interpretation of any term or provision of this Agreement having a
counterpart in or otherwise derived from a term or provision of the Investment Company Act
will be resolved by reference to such term or provision of the Investment Company Act and to
interpretations thereof, if any, by the United States Courts or in the absence of any
controlling decision of any such court, by rules, regulations or orders of the SEC issued
pursuant to the Investment Company Act. In addition, where the effect of
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a requirement of the Investment Company Act reflected in any provision of this Agreement is
modified or interpreted by any applicable order or orders of the SEC or any rules or
regulations adopted by, or interpretative releases of, the SEC thereunder, such provision
will be deemed to incorporate the effect of such order, rule, regulation or interpretative
release.
(c) This Agreement will be construed in accordance with the laws of the State of
Maryland without regard to choice of law or conflicts of law principles thereof, provided
that nothing in this Agreement will be construed in a manner inconsistent with the
Investment Company Act, or in a manner which would cause a Fund to fail to comply with the
requirements of Subchapter M of the Code.
(d) This Agreement constitutes the entire agreement between the parties concerning the
subject matter, and supersedes any and all prior understandings.
(e) If any provision, term or part of this Agreement is deemed to be void,
unenforceable, or invalid for any reason by a court decision, statute, rule, or otherwise,
the remaining provisions of this Agreement will remain in full force and effect as if such
invalid provision, term or part was not a part of this Agreement.
(f) This Agreement will supersede all prior investment advisory or management
agreements entered into between the Adviser and the Corporation on behalf of a Fund.
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IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the day and year
written above.
| DWS RREEF WORLD REAL ESTATE & TACTICAL STRATEGIES FUND, INC. |
||||
| By: | ||||
| Name: | Xxxx Xxxxxxxx | |||
| Title: | Vice President & Secretary | |||
| DEUTSCHE INVESTMENT MANAGEMENT AMERICAS INC. |
||||
| By: | ||||
| Name: | Xxxx Xxxxxxxxx | |||
| Title: | Vice President and Chief Executive Officer | |||
| By: | ||||
| Name: | Xxxxxxx Xxxxx | |||
| Title: | Chief Operating Officer | |||
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SCHEDULE I
INVESTMENT MANAGEMENT FEE RATES
(as a percentage of net assets)
| Investment Management | ||||
| Fund | Fee Rate | |||
DWS RREEF World Real Estate &
Tactical Strategies Fund, Inc. |
0.90% | |||
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