MANAGEMENT AGREEMENT
This MANAGEMENT AGREEMENT ("Agreement") is
made this 1st day of December, 2005, by and between
Citigroup Investments Corporate Loan Fund Inc.,
a Maryland Corporation (the "Corporation") and Xxxxx
Xxxxxx Fund Management LLC, a Delaware limited
liability company (the "Manager").
WHEREAS, the Corporation is registered as a
management investment company under the
Investment Company Act of 1940, as amended
(the "1940 Act");
WHEREAS, the Manager is engaged
primarily in rendering investment advisory,
management and administrative services and
is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended;
WHEREAS, the Corporation wishes to retain the
Manager to provide investment advisory, management,
and administrative services to the Corporation (the "Fund");
and
WHEREAS, the Manager 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:
1. The Corporation hereby appoints the Manager
to act as investment adviser and administrator of the Fund
for the period and on the terms set forth in this Agreement.
The Manager accepts such appointment and agrees to
render the services herein set forth, for the compensation
herein provided.
2. The Fund shall at all times keep the Manager fully
informed with regard to the securities owned by it, its funds
available, or to become available, for investment, and generally
as to the condition of its affairs. It shall furnish the Manager with
such other documents and information with regard to its affairs
as the Manager may from time to time reasonably request.
3. (a) Subject to the supervision of
the Corporation's Board of Directors (the "Board"), the Manager
shall regularly provide the Fund with investment research, advice,
management and supervision and shall furnish a continuous
investment program for the Fund's portfolio of securities and
other investments consistent with the Fund's investment
objectives, policies and restrictions, as stated in the Fund's
current Prospectus and Statement of Additional Information.
The Manager shall 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 assets of the
Fund's portfolio 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 Corporation'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 Manager. The Manager is authorized as the agent of the
Corporation to give instructions 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 and direction from the Board, the
investment program to be provided hereunder may entail the
investment of all or substantially all of the assets of a Fund in
one or more investment companies. The Manager will place
orders pursuant to its 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) to the Funds and/or the other accounts over
which the Manager or its affiliates exercise investment discretion. The
Manager is authorized to pay a broker or dealer who provides such
brokerage and research services a commission for executing a
portfolio transaction for a Fund which is in excess of the amount of
commission another broker or dealer would have charged for
effecting that transaction if 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 or dealer. This determination may be viewed in terms of
either that particular transaction or the overall responsibilities
which the Manager 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
Manager's authority regarding the execution of the Fund's
portfolio transactions provided herein. The Manager shall also
provide advice and recommendations with respect to other
aspects of the business and affairs of the Fund, shall exercise
voting rights, rights to consent to corporate action and any
other rights pertaining to a Fund's portfolio securities 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) Subject to the direction and control of the
Board, the Manager shall perform such administrative and
management services as may from time to time be reasonably
requested by the Fund as necessary for the operation of the
Fund, such as (i) supervising the overall administration of the
Fund, including negotiation of contracts and fees with and the
monitoring of performance and xxxxxxxx of the Fund's transfer
agent, shareholder servicing agents, custodian and other
independent contractors or agents, (ii) providing certain
compliance, fund accounting, regulatory reporting, and tax
reporting services, (iii) preparing or participating in the
preparation of Board materials, registration statements,
proxy statements and reports and other communications to
shareholders, (iv) maintaining the Fund's existence, and (v)
during such times as shares are publicly offered, maintaining
the registration and qualification of the Fund's shares under
federal and state laws. Notwithstanding the foregoing, the
Manager shall not be deemed to have assumed any duties
with respect to, and shall not be responsible for, the distribution
of the shares of any Fund, nor shall the Manager be deemed to
have assumed or have any responsibility with respect to
functions specifically assumed by any transfer agent, fund
accounting agent, custodian, shareholder servicing agent or
other agent, in each case employed by the Fund to perform
such functions.
(c) The Fund hereby authorizes any entity
or person associated with the Manager 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 Securities Exchange Act of 1934, as
amended, 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 Manager 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 Manager or its affiliates is participating, or arrange for
purchases and sales of securities between a Fund and another
account advised by the Manager 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 a Fund from
time to time, and will comply with all other provisions of the
Governing Documents and the Fund's then-current Prospectus
and Statement of Additional Information relative to the Manager
and its directors and officers.
4. Subject to the Board's approval, the Manager or the
Fund may enter into contracts with one or more investment
subadvisers or subadministrators, including without limitation,
affiliates of the Manager, in which the Manager delegates to
such investment subadvisers or subadministrators any or all
its duties specified hereunder, on such terms as the Manager
will determine to be necessary, desirable or appropriate,
provided that in each case the Manager shall supervise the
activities of each such subadviser or subadministrator and
further provided that such contracts impose on any investment
subadviser or subadministrator bound thereby all the conditions
to which the Manager is subject hereunder and that such contracts
are entered into in accordance with and meet all applicable
requirements of the 1940 Act.
5. (a) The Manager, at its expense, shall supply
the Board and officers of the Corporation with all information and
reports reasonably required by them and reasonably available to
the Manager and shall furnish the Fund with office facilities,
including space, furniture and equipment and all personnel
reasonably necessary for the operation of the Fund. The Manager
shall oversee the maintenance of all books and records with
respect to the Fund's securities transactions and the keeping
of the Fund's books of account in accordance with all applicable
federal and state laws and regulations. In compliance with the
requirements of Rule 31a-3 under the 1940 Act, the Manager
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 Manager 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.
The Manager shall authorize and permit any of its directors,
officers and employees, who may be elected as Board members
or officers of the Fund, to serve in the capacities in which they are
elected.
(b) The Manager 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 Manager 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
proceedingsto 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.
6. No member of the Board, officer or employee of the Corporation
or Fund shall receive from the Corporation or 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 Manager
or any affiliated company of the Manager, 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 Manager's or any affiliated company's staff.
7. As compensation for the services performed and the facilities
furnished and expenses assumed by the Manager, including the services
of any consultants retained by the Manager, the Fund shall pay the
Manager, as promptly as possible after the last day of each month,
a fee, computed daily at an annual rate set forth opposite the Fund's
name on Schedule A annexed hereto, provided however, that if the
Fund invests all or substantially all of its assets in another registered
investment company for which the Manager or an affiliate of the
Manager serves as investment adviser or investment manager, the
annual fee computed as set forth on such Schedule A shall be reduced
by the aggregate management fees allocated to that Fund for the Fund's
then-current fiscal year from such other registered investment company.
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 Manager 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 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 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.
8. The Manager 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 a Fund, provided that
nothing in this Agreement shall protect the Manager against any
liability to the Fund to which the Manager 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 8,
the term "Manager" shall include any affiliates of the Manager performing
services for the Corporation or the Fund contemplated hereby and the
partners, shareholders, directors, officers and employees of the
Manager and such affiliates.
9. Nothing in this Agreement shall limit or restrict the right of
any director, officer, or employee of the Manager who may also be a
Board member, officer, or employee of the Corporation or 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 Manager 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 a Fund or one or more other accounts
of the Manager 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 Manager. Such transactions
may be combined, in accordance with applicable laws and regulations,
and consistent with the Manager's policies and procedures as
presented to the Board from time to time.
10. For the purposes of this Agreement, the Fund's "net assets"
shall be determined as provided in the Fund's then-current 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.
11. 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
Corporation's Board and 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 for two years
from the above written date. Thereafter, if not terminated, this
Agreement shall continue in effect with respect to the Fund, so
long as such continuance is specifically approved at 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.
12. 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
Manager, or by the Manager upon not less than 90 days' written
notice to the Fund, and will be terminated upon the mutual written
consent of the Manager and the Corporation. This Agreement
shall terminate automatically in the event of its assignment by the
Manager and shall not be assignable by the Corporation without
the consent of the Manager.
13. The Manager agrees that for services rendered to the
Fund, or for any claim by it in connection with services rendered to
the Fund, 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 Corporation.
14. 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 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.
15. This Agreement 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.
16. 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.
CITIGROUP INVESTMENTS CORPORATE
LOAN FUND INC.
By:_______________________________
Name: R. Xxx Xxxxxx
Title: Chairman
