EXHIBIT (g)(1)
INVESTMENT ADVISORY AGREEMENT
THIS INVESTMENT ADVISORY AGREEMENT (this "Agreement") is entered into and
made effective as of the day of , 2000 by and between meVC DELTA
LIFE SCIENCES FUND I, INC., a Maryland corporation (the "Fund"), and meVC
ADVISERS, INC., a Delaware corporation ("Adviser").
WITNESSETH:
WHEREAS, the Fund is a non-diversified closed-end management investment
company that has elected to be regulated as a business development company
pursuant to the provisions of the Investment Company Act of 1940, as amended,
and the rules and regulations promulgated thereunder (the "Investment Company
Act"); and
WHEREAS, Adviser is a registered investment adviser pursuant to the
Investment Advisers Act of 1940, as amended, and the rules and regulations
promulgated thereunder (the "Advisers Act"); and
WHEREAS, Adviser desires to serve as the Fund's investment adviser and, in
connection therewith, to perform certain services for the Fund with respect to
the administration of the Fund and its investment activities, in all cases under
the supervision and control of the Fund's Board of Directors and on the terms
and subject to the conditions set forth herein; and
WHEREAS, the Fund desires to retain Adviser to serve as its investment
adviser and, in connection therewith, to perform certain administrative and
investment advisory services under the supervision of the Fund's Board of
Directors and on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. APPOINTMENT OF ADVISER; DUTIES OF ADVISER.
(a) The Fund hereby retains Adviser to serve as its investment adviser for
the period and on the terms and subject to the conditions as set forth in this
Agreement.
(b) Subject to the supervision and control by the Fund's Board of Directors,
Adviser shall:
(i) manage the Fund's day-to-day operations and administration, record
keeping and regulatory compliance functions. Without limiting the generality
of the foregoing, Adviser shall specifically be responsible for
(A) preparing periodic financial statements; (B) preparing financial and
accounting reports for presentation to the Fund's Board of Directors and
shareholders and governmental agencies; (C) calculating and publishing the
Fund's net asset value per share; (D) overseeing the preparation and filing
of the Fund's tax returns; (E) preparing and providing such reports to the
Fund's Board of Directors and shareholders as may from time to time be
considered necessary or appropriate by the Fund's Board of Directors or by
Adviser; (F) overseeing the payment of the Fund's expenses and the
performance of administrative and professional services rendered to the Fund
by others; (G) preparing an annual proxy statement and conducting the annual
meeting of stockholders of the Fund; and (H) managing such other
operational, administrative and regulatory compliance duties as shall from
time to time arise as a result of the Fund's operations and investing
activities; and
(ii) (A) manage the investment and reinvestment of the Fund's assets;
(B) continuously review, supervise and administer the Fund's investment
program to determine in its discretion the securities to be purchased or
sold and the portion of the Fund's assets to be held uninvested;
(C) provide the Fund with all required records concerning Adviser's efforts
on behalf of the Fund; and (D) provide regular reports to the Fund's Board
of Directors concerning Adviser's activities on behalf of the Fund.
2. ACCEPTANCE BY ADVISER. Adviser hereby accepts appointment as investment
adviser to the Fund on the terms and conditions set forth on this Agreement, and
agrees to discharge the foregoing responsibilities in compliance with the
investment objectives, policies and limitations set forth in the Fund's
prospectus (as it may be amended or supplemented from time to time, the
"Prospectus") and applicable laws and regulations, and under the supervision and
control of the Fund's Board of Directors.
3. CONTRACTING FOR SUB-ADVISORY AND SUB-ADMINISTRATIVE SERVICES.
(a) Adviser may, subject to compliance with the provisions of the Investment
Company Act, contract with an investment sub-adviser and/or sub-administrator to
assist Adviser in the performance of its duties under this Agreement.
(b) In the event Adviser elects to retain an investment sub-adviser and/or
sub-administrator pursuant to this Section 3, Adviser specifically acknowledges
and agrees as follows:
(i) compensation for services provided and reimbursement of the expenses
of any such investment sub-adviser and/or sub-administrator shall be the
sole responsibility and obligation of Adviser;
(ii) any contract or other agreement, whether oral or written, entered
into between Adviser and any such sub-adviser and/or sub-administrator shall
be between those parties solely and shall not operate to relieve Adviser of
any of its obligations to the Fund or any liability it might otherwise have
under or pursuant to this Agreement, all of which shall remain the sole
responsibility and obligation of Adviser; and
(iii) in the event a contract or agreement between Adviser and any such
sub-adviser and/or sub-administrator includes one or more provisions for the
benefit of the Fund as a third-party beneficiary, Adviser shall enforce such
provisions on behalf of the Fund to the same degree as it would enforce any
other provision of such agreement on its own behalf.
4. COMPENSATION.
(a) In compensation for Adviser's services as set forth in this Agreement,
the Fund shall pay to Adviser an annual management fee equal to 2.5% of the
Fund's net assets (the "Management Fee"). The Management Fee shall be computed
on the basis of the Fund's average weekly net assets and shall be paid to
Adviser in twelve equal installments on the last business day of each calendar
month.
(b) As further compensation for Adviser's services, the Fund shall pay to
Adviser annual incentive compensation (the "Incentive Fee") in an amount equal
to twenty percent (20%) of the Fund's annual realized capital gains on its
investments, net of realized losses and unrealized capital depreciation. The
Incentive Fee shall be paid to Adviser from time to time as determined by the
Board of Directors of the Fund.
(c) In the event this Agreement is terminated, any compensation to which
Adviser may be entitled to receive pursuant to this Section 4 shall be computed
as of the period ending on the last business day on which this Agreement is in
effect, subject to pro rata adjustment based on the number of days elapsed in
the current month as a percentage of the total number of days in such month.
5. EXPENSES. Adviser shall pay all of its own costs and expenses,
including such costs and expenses as Adviser may incur in the performance of its
duties pursuant to this Agreement.
6. LIMITATION OF LIABILITY. In the absence of: (i) willful misfeasance,
bad faith or gross negligence on the part of Adviser in the performance of its
obligations and duties hereunder; (ii) reckless disregard by Adviser of its
obligations and duties hereunder; or (iii) a loss resulting from a breach of
fiduciary duty with respect to the receipt of compensation for services (in
which case any award of damages shall be limited to the period and the amount
set forth in Section 36(b)(3) of the
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Investment Company Act), Adviser shall not be subject to liability to the Fund
or any of its stockholders for any error of judgment, mistake of law or any
other act or omission in the course of, or connected with, its rendering of
services hereunder including, without limitation, for any losses that may be
sustained in connection with the purchase, holding, redemption or sale of any
security by Adviser on behalf of the Fund.
7. EXCLUSIVITY. The services provided by Adviser hereunder are not
exclusive and Adviser shall therefore remain free to render such services to
others.
8. RECORDS. Adviser agrees to preserve the records required by Rule 204-2
promulgated under the Advisers Act for the period specified therein.
9. WRITTEN DISCLOSURE STATEMENT. Adviser has previously delivered to the
Fund a written disclosure statement as required by Section 204-3(a) of the
Advisers Act in the form of either a copy of Part II of Adviser's Form ADV which
complies with Section 204-1(b) of the Advisers Act or a written document
containing at least the information required by Part II of Form ADV. Such
written disclosure statement was delivered by Adviser to the Fund within the
time period specified by Section 204-1(b) of the Advisers Act.
10. DURATION. This Agreement shall be effective beginning on the date set
forth in the preamble hereof, and shall remain in force for an initial period of
two (2) years. Upon expiration of the initial term, the term of this Agreement
shall be automatically extended for successive one (1) year periods, PROVIDED,
that each such one (1) year extension is approved by the Fund's Board of
Directors or by the holders of at least a majority of the Fund's outstanding
voting securities.
11. TERMINATION.
(a) This Agreement may be terminated by (i) the Fund's Board of Directors or
(ii) the holders of a majority of the Fund's outstanding voting securities at
any time and without penalty, upon delivery of written notice of such
termination at least sixty (60) days prior to the termination date.
(b) This Agreement may be terminated by Adviser at any time and without
penalty, upon delivery of written notice of such termination at least sixty (60)
days prior to the termination date.
(c) This Agreement shall immediately and automatically terminate in the
event of its assignment.
12. AMENDMENTS. This Agreement may be amended with the mutual consent of
the parties; provided, however, that the Fund shall not consent to any such
amendment unless such amendment shall be approved by (i) a majority of the
Fund's directors, (ii) a majority the Fund's disinterested directors and
(iii) the holders of a majority of the Fund's outstanding voting securities.
13. AGENCY RELATIONSHIP. Nothing herein shall be construed so as to
constitute Adviser as an agent of the Fund.
14. SEVERABILITY. If any term or condition of this Agreement shall be
found to be invalid or unenforceable to any extent or in any application, the
remainder of this Agreement, including such term or condition, except to the
extent or in such application such term or condition is held invalid or
unenforceable, shall not be affected thereby, and each and every term and
condition of this Agreement shall be valid and enforceable to the fullest extent
and in the broadest application permitted by law.
15. CAPTIONS. The captions of this Agreement are included for convenience
only and in no way define or limit any of the provisions hereof or otherwise
affect their construction or effect.
16. DEFINITIONS. For purposes of this Agreement, "majority of the
outstanding voting securities," "assignment" and "interested person" shall have
the respective meanings assigned to them in the Investment Company Act, subject,
however, to such exemptions as may be granted by the Securities
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and Exchange Commission pursuant to its rule-making authority as set forth in
the Investment Company Act or the Advisers Act, as the case may be.
17. NOTICES. All notices required or permitted to be delivered under or
pursuant to this Agreement shall be so delivered by certified mail, postage
prepaid, as follows:
If to Adviser: meVC Advisers, Inc.
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Secretary
If to the Fund: meVC DELTA LIFE SCIENCES FUND I, INC.
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Secretary
with a copy to: Xxxxxxxxxxx & Xxxxxxxx LLP
0000 Xxxxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, XX 00000-0000
Attn: R. Xxxxxxx Xxxxxx, Esq.
Any notice delivered pursuant to this Section 17 shall be deemed delivered
on the third day following its deposit in the United States mail or the date
such notice is actually received by the addressee, whichever shall occur first.
18. ENTIRE AGREEMENT. This Agreement contains the entire agreement of the
parties with respect to the matters referred to herein and supersedes all prior
agreements, negotiations, commitments or understandings.
19. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original and together shall constitute one and the same document.
20. GOVERNING LAW. This Agreement shall be construed in accordance with
the laws of the State of Maryland and the applicable provisions of the
Investment Company Act and the Investment Advisers Act.
IN WITNESS WHEREOF, the undersigned have executed and delivered this
Agreement as of the date first above written.
meVC DELTA LIFE SCIENCES FUND I, INC.
By:
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Xxxxxx X. Xxxxxx
PRESIDENT
meVC ADVISERS, INC.
By:
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Xxxxx X. Xxxxxxxxxxx
CHAIRMAN OF THE BOARD AND PRESIDENT
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