Exhibit (g)(ii)
AMENDMENT NO. 1 TO INVESTMENT
ADVISORY AGREEMENT
This Amendment No. 1 is made and entered into as of the 1st day of
January 2000, between Pacholder High Yield Fund, Inc., a Maryland corporation
(the "Fund"), and Pacholder & Company, LLC, an Ohio limited liability company
(the "Adviser").
WHEREAS, the Fund and the Adviser have entered into an Investment
Advisory Agreement dated August 20, 1998 (the "Agreement"); and
WHEREAS, the Fund and the Adviser desire to amend the Agreement with
respect to the investment advisory fee;
NOW, THEREFORE, the parties agree as follows:
1 Section 3 of the Agreement is hereby amended to read as follows:
3. Compensation.
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A. Fulcrum Fee. As full compensation for the services provided,
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facilities furnished and expenses paid by the Adviser under this
Agreement, the Fund agrees to pay the Adviser an annual investment
advisory fee, which increases and decreases proportionately based on the
investment performance of the Fund in relation to the investment record
of the Credit Suisse First Boston Domestic+ High Yield Index (the
"Index"). The advisory fee shall be accrued at least weekly and paid
quarterly as soon as practicable after the end of each calendar quarter,
as follows:
(i) If the Fund's investment performance for the 12
months immediately preceding the end of the quarter is equivalent
to the investment record of the Index for the same 12-month
period, then the advisory fee shall be computed at the annual
rate of 0.90% of the Fund's average net assets. The rate at which
the advisory fee is computed shall be increased or decreased from
the 0.90% fulcrum fee by 10% of the amount by which the
investment performance of the Fund exceeds or is less than the
investment record of the Index, up to a maximum of 1.40% and down
to a minimum of 0.40%. For purposes of calculating the amount of
the advisory fee, the Fund's average net assets shall be
determined by taking the average of all determinations of such
net assets during the applicable 12-month period and the Fund's
net assets shall mean the total assets of the Fund minus accrued
liabilities of the Fund other than the principal amount of any
outstanding senior securities representing indebtedness (within
the meaning of Section 18 of the 1940 Act). The investment
performance of the Fund and the investment record of the Index
shall be determined in accordance with the Advisers Act and the
rules and regulations promulgated thereunder.
(ii) The compensation payable to the Adviser after the end
of each quarter shall be equal to the amount of the annual
advisory fee calculated as provided in sub-paragraph (i) above
reduced by the compensation previously paid by the Fund to the
Adviser in respect of the applicable 12-month period. In the
event that such prior payments should exceed the amount of the
annual advisory fee payable hereunder, the Adviser shall remit to
the Fund such excess as soon as practicable after the end of the
quarter.
B. Proration. If the Adviser shall serve for less than the
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whole of any quarter, the investment advisory fee shall be prorated on
the basis of the 12-month period immediately preceding the date of
termination of this Agreement.
1
2 Notwithstanding the foregoing, during the 12-month period
immediately following the date on which this Amendment takes effect, the Fund
shall pay the Adviser the minimum fee payable under the Agreement and any
balance due based on the Fund's investment performance during the period shall
be paid to the Adviser upon completion of such period.
3 The Fund and the Adviser hereby ratify and confirm all of the
other terms, conditions and provisions of the Agreement, as remaining, in full
force and effect.
IN WITNESS WHEREOF, the parties to the Agreement have caused this
Amendment to be executed on their behalf by their duly authorized officers as of
the day and year first above written.
PACHOLDER HIGH YIELD FUND, INC.
By: /s/
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PACHOLDER & COMPANY, LLC
By: /s/
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