EXHIBIT 99(g)(ii)
XXXXXXX, XXXXXXX & XXXXX, INC.
000 XXXX XXXXXX
XXX XXXX, XXX XXXX 00000
RESEARCH AND ADVISORY AGREEMENT
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July 26, 1995
Banco Icatu S.A.
Xx. Xxxxxxxxxx Xxxxxx
000 0/x/ xxxxx
Xxx xx Xxxxxxx, Xxxxxx
CEP: 20030 021
Dear Sirs:
Xxxxxxx, Xxxxxxx & Xxxxx, Inc. (the "Manager") has entered into an
Investment Advisory, Management and Administration Agreement (the "Management
Agreement") dated as of July 26, 1995 with The Brazil Fund, Inc., a Maryland
corporation (the "Fund"), pursuant to which the Manager is to act as investment
adviser to and manager of the Fund. A copy of the Management Agreement has been
previously furnished to you.
The Manager wishes to avail itself of your investment advisory services.
Accordingly, the Manager, with the acceptance of the Fund, hereby agrees with
you as follows for the duration of this Agreement:
1. The Manager hereby contracts with you for the maintenance of the
technical department specialized in the analysis of stocks and securities
contemplated by Paragraph 1 of Article 4 of the Regulations attached as Annex
III to the National Monetary Council Resolution No. 1,289 of March 20, 1987 (the
"Regulations"). The Manager hereby directs that in so acting, you shall give all
advice solely to, and take all instructions solely from, the Manager.
2. You agree to furnish to the Manager such information, investment
recommendations, advice and assistance, as the Manager shall from time to time
reasonably request. In that connection, you agree to continue to maintain within
your organization a technical department specialized in the analysis of stocks
and securities to furnish such services exclusively to the Manager. Attached is
a copy of a memorandum describing the proposed working procedures to be followed
by you in working with the Manager, which may be revised by mutual agreement as
you work with the Manager pursuant to this Agreement. In addition, for the
benefit of the Fund, you agree to pay the fees and expenses of any directors or
officers of the Fund who are directors, officers or employees of you or of any
of your affiliates.
3. The Manager agrees to pay or to cause to be paid to you, as full
compensation for the services to be rendered and expenses to be borne by you
hereunder, a monthly fee in BRLs, which, on an annual basis, is equal to 0.125%
per annum of the value of the Fund's average weekly net assets up to and
including US$150 million; 0.075% per annum of the value of the Fund's average
weekly net assets over US$150 million and up to and including US$300 million;
and 0.025% per annum of the value of the Fund's average weekly net assets in
excess of US$300 million. Each payment of a monthly fee shall be made to you
within the fifteen days next following the day as of which such payment is so
computed.
The value of the net assets of the Fund shall be determined pursuant to the
applicable
provisions of the Certificate of Incorporation and By-Laws of the Fund.
4. You agree that you will not make a short sale of any capital stock of the
Fund, or purchase any share of the capital stock of the Fund otherwise than for
investment.
5. Your services to the Manager are not to be deemed exclusive and you are
free to render similar services to others, except as otherwise provided in
Section 2 hereof.
6. Nothing herein shall be construed as constituting you an agent of the
Manager or of the Fund.
7. You represent and warrant that you are registered as an investment
adviser under the U.S. Investment Advisers Act of 1940, as amended, and will
comply with such Act and the U.S. Investment Company Act of 1940, as amended,
and the rules thereunder. You agree to maintain such registration in effect
during the term of this Agreement. You further represent and warrant that you
are accredited by the Comissao de Valores Mobiliarios ("CVM") within the meaning
of Paragraph 1 of Article 4 of the Regulations. You agree to use your best
efforts to maintain such accreditation in effect during the term of this
Agreement. You further agree to comply with the Regulations and all other
applicable laws and regulations in performing your obligations hereunder.
8. Neither you nor any affiliate of yours shall receive any compensation in
connection with the placement or execution of any transaction for the purchase
or sale of securities or for the investment of funds on behalf of the Fund,
except that you or your affiliates may receive a commission, fee or other
remuneration for acting as broker in connection with the sale of securities to
or by the Fund, if permitted under the U.S. Investment Company Act of 1940, as
amended.
9. You represent and warrant to the Manager that there is no publicly held
company which is an affiliated person (as defined in the U.S. Investment Company
Act of 1940, as amended), or an affiliated person of an affiliated person, of
yours. You will advise the Manager immediately if any publicly held company is
an affiliated person, or an affiliated person of an affiliated person, of yours
10. You will advise the Manager as soon as possible if, to the best of your
knowledge, any publicly held company is an affiliated person (within the meaning
of Articles 29(vii) and 32 of the Regulations) of Banco de Boston (the
"Brazilian Administrator") or of a company affiliated with the Brazilian
Administrator.
11. The Manager agrees that you may rely on information reasonably believed
by you to be accurate and reliable, and further agrees that, except to the
extent otherwise provided under applicable Brazilian law, neither you nor your
officers, directors, employees or agents shall be subject to any liability for
any act or omission in the course of, connected with or arising out of any
services to be rendered hereunder, except by reason of willful misfeasance, bad
faith or gross negligence in the performance of your duties or by reason of
reckless disregard of your obligations and duties under this Agreement.
12. This Agreement shall remain in effect for a period of two years from the
date hereof and shall continue in effect thereafter, but only so long as such
continuance is specifically approved at least annually by the affirmative vote
of (i) a majority of the members of the Fund's Board of Directors who are not
interested persons of the Fund, the Manager, or you, cast in person at a meeting
called for the purpose of voting on such approval, and (ii) a majority of the
Fund's Board of Directors or the holders of a majority of the outstanding voting
securities of the Fund. This Agreement may nevertheless be terminated at any
time, without penalty, by the Fund's Board of Directors or by vote of holders of
a majority of the outstanding voting securities of the Fund, upon 60 days'
written notice delivered or sent by registered mail, postage prepaid, to you, at
your
address given above or at any other address of which you shall have notified us
in writing, or by you, but only after written notice to the Fund, the Manager,
and the CVM, of not less than 60 days (or such longer period as may be required
under the Regulations). This Agreement shall automatically be terminated in the
event of its assignment or of the termination (due to assignment or otherwise)
of the Management Agreement.
13. This Agreement may not be transferred, assigned, sold or in any manner
hypothecated or pledged by either party hereto. It may be amended by mutual
agreement, but only after authorization of such amendment by the affirmative
vote of (i) the holders of a majority of the outstanding voting securities of
the Fund; and (ii) a majority of the members of the Fund's Board of Directors
who are not interested persons of the Fund, the Manager, or you, cast in person
at a meeting called for the purpose of voting on such approval.
14. Any notice hereunder shall be in writing and shall be delivered in
person or by facsimile (followed by mailing such notice, air mail postage paid,
the day on which such facsimile is sent)
Addressed
If to the Fund, to:
The Brazil Fund, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: President
(Facsimile No. 212-223-3127)
If to the Manager, to:
Xxxxxxx, Xxxxxxx & Xxxxx, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: President
(Facsimile No. 212-319-7813)
If to you, to:
Banco Icatu S.A.
Xx. Xxxxxxxxxx Xxxxxx
000 0/x/ xxxxx
Xxx xx Xxxxxxx, Xxxxxx
CEP: 20030 021
Attention: President
(Facsimile No. 021-240-4133)
or to such other address as to which the recipient shall have informed the other
party.
Notice given as provided above shall be deemed to have been given, if by
personal delivery, on the day of such delivery, and if by facsimile and mail,
the date on which such facsimile and confirmatory letter are sent.
15. This Agreement shall be construed in accordance with the laws of the
State of New York, provided, however, that nothing herein shall be construed as
being inconsistent with the U.S. Investment Company Act of 1940, as amended, or
the Regulations. As used herein the terms "interested person," assignment," and
"vote of a majority of the outstanding voting securities" shall have the
meanings set forth in the U.S. Investment Company Act of 1940, as amended.
If you are in agreement with the foregoing, please sign the form of
acceptance on
the enclosed counterpart hereof and return the same to us.
Very truly yours,
XXXXXXX, XXXXXXX & XXXXX, INC.
By
---------------------------------
Managing Director
The foregoing agreement is hereby
accepted as of the date first above
written.
Banco Icatu S.A.
By
---------------------------------
Director
By
---------------------------------
Director
Accepted:
THE BRAZIL FUND, INC.
By
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President
