EXHIBIT (g)(ii)
INVESTMENT ADVISORY AGREEMENT (SIA)
INVESTMENT ADVISORY AGREEMENT
THIS INVESTMENT ADVISORY AGREEMENT (this "Agreement") is made as of
the 26th day of April, 2002, by and among XXXXXXX INVESTMENT ADVISERS, a
Barbados international business company (the "Adviser") and BOULDER GROWTH &
INCOME FUND, INC., a Maryland corporation (the "Fund").
1. Investment Description; Appointment. The Fund desires to employ its
capital by investing and reinvesting in investments of the kind and in such
manner and to such extent as may from time to time be approved by the Board of
Directors of the Fund (the "Board"). The Fund desires to employ and hereby
appoints the Adviser to act as investment adviser to the Fund. Adviser hereby
accepts the appointment and agrees to furnish the services described herein for
the compensation set forth below.
2. Services as Investment Adviser. Subject to the supervision and direction
of the Board, the Adviser will (a) act in accordance with the Investment Company
Act of 1940 (the "1940 Act") and the Investment Advisers Act of 1940, as the
same may be from time to time amended, (b) manage the Fund's portfolio on a
discretionary basis in accordance with its investment objectives and policies,
(c) make investment decisions and exercise voting rights in respect of portfolio
securities for the Fund, (d) place purchase and sale orders on behalf of the
Fund, (e) employ, at its own expense, professional portfolio managers and
securities analysts to provide research services to the Fund, (f) determine the
portion of the Fund's assets to be invested, from time to time, in various asset
classes (e.g., common stocks, fixed income securities, cash equivalents), (g)
determine the portion of the Fund's assets to be leveraged, from time to time,
and the form that such leverage will take, and (h) monitor and evaluate the
services provided by the Fund's investment sub-adviser(s), if any, under the
terms of the applicable investment sub-advisory agreement(s). In providing these
services, the Adviser will provide investment research and supervision of the
Fund's evaluation and, if appropriate, sale and reinvestment of the Fund's
assets. In addition, the Adviser will furnish the Fund with whatever statistical
information the Fund may reasonably request with respect to the securities that
the Fund may hold or contemplate purchasing.
3. Co-Advisor to the Fund. Subject to the approval of the Board and where
required, the Fund's shareholders, the Fund will engage an investment
co-adviser, Boulder Investment Advisers, LLC, a Colorado limited liability
company and registered investment adviser under the Investment Advisers Act of
1940, in respect of all or a portion of the Fund's assets (the "Co-Adviser").
The Adviser and the Co-Adviser will be jointly responsible for providing the
services described in
subparagraphs (b), (c), (d), (e), (f) and (g) in Paragraph 2 above and
Paragraphs 5 and 6 below (Information Provided to Fund) with respect to the
Fund's assets, although the Adviser will have primary responsibility for all
record-keeping and day-to-day business activities relating to the investment
operations of the Fund. In the event that the Co-Adviser's engagement is
terminated, the Adviser shall be responsible for furnishing the Fund with the
services theretofore performed by such Co-Adviser under the applicable
investment advisory agreement or arranging for a successor co-adviser or
sub-adviser, as the case may be, to provide such services under terms and
conditions acceptable to the Fund and the Board and subject to the requirements
of the 1940 Act.
4. Engagement of Sub-Advisers to the Fund. Subject to the approval of the
Board and where required, the Fund's shareholders, the Adviser may engage an
investment sub-adviser or sub-advisers to provide advisory services in respect
of all or a portion of the Fund's assets (the "Sub-Advised Portion") and may
delegate to such investment sub-adviser(s) all or a portion of the
responsibilities described in subparagraphs (b), (c), (d), (e), (f) and (g) in
Paragraph 2 above and Paragraph 6 below (Information Provided to Fund) with
respect to the Sub-Advised Portion. In the event that an investment
sub-adviser's engagement has been terminated, the Adviser shall be responsible
for furnishing the Fund with the services required to be performed by such
investment sub-adviser(s) under the applicable investment sub-advisory
agreements or arranging for a successor co-adviser or sub-adviser, as the case
may be, to provide such services under terms and conditions acceptable to the
Fund and the Board and subject to the requirements of the 1940 Act.
5. Brokerage. In executing transactions for the Fund and selecting brokers
or dealers, the Adviser will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available for any Fund
transaction, the Adviser will consider all factors it deems relevant including,
but not limited to, breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of any commission for the specific transaction and
on a continuing basis. In selecting brokers or dealers to execute any
transaction and in evaluating the best overall terms available, the Adviser may
consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) provided to the Fund
and/or other accounts over which the Adviser or any affiliate exercises
investment discretion.
6. Information Provided to the Fund. The Adviser will use its best efforts
to keep the Fund informed of developments materially affecting the Fund, and
will, on its own initiative, furnish the Fund from time to time with whatever
information the Adviser believes is appropriate for this purpose.
7. Standard of Care. The Adviser shall exercise its best judgment in
rendering the services described herein. The Adviser
shall not be liable for any error of judgment or mistake of law or omission or
any loss suffered by the Fund in connection with the matters to which this
Agreement relates, provided that nothing herein shall be deemed to protect or
purport to protect the Adviser against any liability to the Fund to which the
Adviser would otherwise be subject by reason of willful misfeasance, bad faith
or gross negligence on its part in the performance of its duties or from
reckless disregard by it of its obligations and duties under this Agreement
("Disabling Conduct"). The Fund will indemnify the Adviser against, and hold it
harmless from, any and all losses, claims, damages, liabilities or expenses
(including reasonable counsel fees and expenses), including any amounts paid in
satisfaction of judgments, in compromise or as fines or penalties, not resulting
from Disabling Conduct by the Adviser. Indemnification shall be made only
following (i) a final decision on the merits by a court or other body before
whom the proceeding was brought that the Adviser was not liable by reason of
Disabling Conduct, or (ii) in the absence of such a decision, a reasonable
determination, based upon a review of the facts, that the Adviser was not liable
by reason of Disabling Conduct by (a) the vote of a majority of the Directors of
the Fund who are neither "interested persons" of the Fund nor parties to the
proceeding ("disinterested non-party Directors"), or (b) independent legal
counsel in a written opinion. The Adviser shall be entitled to advances from the
Fund for payment of the reasonable expenses incurred by it in connection with
the matter to which it is seeking indemnification in the manner and to the
fullest extent permissible under the law. The Adviser shall provide to the Fund
a written affirmation of its good faith belief that the standard of conduct
necessary for indemnification by the Fund has been met and a written undertaking
to repay any such advance if it should ultimately be determined that the
standard of conduct has not been met. In addition, at least one of the following
additional conditions shall be met: (a) the Adviser shall provide a security in
form and amount acceptable to the Fund for its undertaking; (b) the Fund is
insured against losses arising by reason of the advance; or (c) a majority of
disinterested non-party Directors, or independent legal counsel, in a written
opinion, shall have determined, based on a review of facts readily available to
the Fund at the time the advance is proposed to be made, that there is reason to
believe that the Adviser will ultimately be found to be entitled to
indemnification.
8. Compensation. In consideration of the services rendered pursuant to this
Agreement, the Fund will pay the Adviser the Advisory Fee (as defined in the Fee
Schedule) such amount to be paid monthly, in the amount set forth in the fee
schedule attached hereto as Exhibit A (the "Fee Schedule"). The Advisory Fee
shall be the aggregate and entirety of all advisory fees to be paid by the Fund
and will be divided between the Adviser and the Co-Adviser as set forth in the
Fee Schedule, which fee split may be adjusted from time to time in the
discretion of the Board so long as the aggregate advisory fee does not exceed
the Advisory Fee. The fee payable to Adviser for any
period shorter than a full calendar month shall be prorated according to the
proportion that such payment bears to the full monthly payment.
9. Expenses. Except as indicated below, the Adviser will bear all expenses
in connection with the performance of its services under this Agreement,
including the fees payable to the Co-Adviser and to any investment sub-adviser
engaged pursuant to Paragraphs 3 or 4 of this Agreement. The Fund will bear
certain other expenses to be incurred in its operation, including organizational
expenses, taxes, interest, brokerage costs and commissions and stock exchange
fees; fees of Directors of the Fund who are not also officers, directors or the
employees of Adviser; Securities and Exchange Commission fees; state Blue Sky
qualification fees; charges of any custodian, any sub-custodians and transfer
and dividend-paying agents; insurance premiums; outside auditing and legal
expenses; costs of maintenance of the Fund's existence; membership fees in trade
associations; stock exchange listing fees and expenses; litigation and other
extraordinary or non-recurring expenses. Additionally, the Fund will bear the
reasonable travel-related expenses (or an appropriate portion thereof) to attend
Board of Directors' meetings for (i) the Fund's executive officers who are also
officers of the Adviser or the Co-Adviser and (ii) the Adviser's, Co-Adviser's
or a sub-adviser's portfolio manager(s) who are primarily responsible for
managing the Fund's portfolio.
10. Services to other Companies or Accounts. The Fund understands that the
Adviser now acts, or may act in the future as an investment adviser to fiduciary
and other managed accounts or other trusts, or as investment adviser to one or
more other registered or unregistered investment companies, and the Fund has no
objection to the Adviser so acting. The Fund understands that the persons
employed by Adviser to assist in the performance of the Adviser's duties
hereunder will not devote their full time to such service and nothing contained
herein shall be deemed to limit or restrict the right of the Adviser or any
affiliate of the Adviser to engage in and devote time and attention to other
businesses or to render services of whatever kind or nature.
11. Term of Agreement. This Agreement shall become effective as of the date
it is approved by a vote of a "majority" (as defined in the 0000 Xxx) of the
Fund's outstanding voting securities (the "Effective Date") and shall continue
for an initial two-year term and shall remain in effect from year to year so
long as such continuance is specifically approved by (a) a majority of the
Directors who are not "interested persons" of the Fund (as defined in the 0000
Xxx) and a majority of the full Board or (b) a majority of the outstanding
voting securities of the Fund (as defined in the 1940 Act). This Agreement is
terminable by a party hereto on sixty (60) days' written notice to the other
party. Any termination shall be without penalty and any notice of termination
shall be deemed given when received by the addressee.
12. No Assignment. This Agreement may not be transferred,
assigned, sold or in any manner hypothecated or pledged by any party hereto and
will terminate automatically in the event of its assignment (as defined in the
1940 Act). It may be amended by mutual agreement, in writing, by the parties
hereto.
13. Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto.
14. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Colorado.
15. Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original for all purposes, and together shall
constitute one and the same Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first above written.
ADVISER: FUND:
XXXXXXX INVESTMENT ADVISERS, a BOULDER GROWTH & INCOME FUND,
Barbados international business company INC., a Maryland corporation
/s/ Xxxxx X. Xxxxxxxxxxx /s/ Xxxxxxx X. Xxxxxx
By: By:
Xxxxx X. Xxxxxxxxxxx Xxxxxxx X. Xxxxxx
Its: President Its: President
Exhibit A
FEE SCHEDULE
Adviser shall be paid after the end of each calendar month, a fee for
the previous month computed at the annual rate of 1.25% of the value of the
Fund's average monthly net assets (the "Advisory Fee"). For purposes of
calculating the Advisory Fee, the Fund's average monthly net assets will be
deemed to be the average monthly value of the Fund's total assets minus the sum
of the Fund's liabilities (excluding leverage borrowings such as bank or
institutional borrowings, preferred stock, bonds, debentures, etc.) and accrued
dividends.
Notwithstanding the foregoing, until such time as more than 50% of the
value of the Fund's assets are invested in equity securities, the Advisory Fee
shall be computed as follows: (i) 0.04167% of the net asset value of the Fund
less net investment income for such month as of the close of business on the
last business day of the month (0.50% on an annual basis); plus (ii) 2.5% of the
sum of (a) the Fund's dividend and interest income; less (b) interest on
borrowed funds during such month.
The Advisory Fee is the maximum aggregate fee that is to be paid to
the Adviser and any co-Adviser or sub-adviser under this and any other
co-advisory or sub-advisory agreements.
Fee Split Between Adviser and Co-Adviser
The Advisory Fee shall initially be split among the Adviser and
Co-Adviser 25% to Boulder Investment Advisers LLC and 75% to Xxxxxxx Investment
Advisers.
