EXHIBIT 6(a)
INVESTMENT ADVISORY AGREEMENT
THIS INVESTMENT ADVISORY AGREEMENT, dated as of May 31, 1997
(the "Agreement"), by and between XXX XXXXXX AMERICAN CAPITAL CALIFORNIA VALUE
MUNICIPAL INCOME TRUST (the "Fund"), a Massachusetts business trust (the
"Trust"), and XXX XXXXXX AMERICAN CAPITAL INVESTMENT ADVISORY CORP. (the
"Adviser"), a Delaware corporation.
1. (a) RETENTION OF ADVISER BY FUND. Subject to the terms and
conditions set forth herein, the Fund hereby employs the Adviser to act as the
investment adviser for and to manage the investment and reinvestment of the
assets of the Fund in accordance with the Fund's investment objective and
policies and limitations, and to administer its affairs to the extent requested
by, and subject to the review and supervision of, the Board of Trustees of the
Fund for the period and upon the terms herein set forth. The investment of funds
shall be subject to all applicable restrictions of applicable law and of the
Declaration of Trust and By-Laws of the Trust, and resolutions of the Board of
Trustees of the Fund as may from time to time be in force and delivered or made
available to the Adviser.
(b) ADVISER'S ACCEPTANCE OF EMPLOYMENT. The adviser accepts
such employment and agrees during such period to render such services, to supply
investment research and portfolio management (including without limitation the
selection of securities for the Fund to purchase, hold or sell and the selection
of brokers through whom the Fund's portfolio transactions are executed, in
accordance with the affairs of the Fund, to furnish offices and necessary
facilities and equipment to the Fund, to provide administrative services for the
Fund, to render periodic reports to the Board of Trustees of the Fund, and to
permit any of its officers or employees to serve without compensation as
trustees or officers of the Fund if elected to such positions.
(c) ESSENTIAL PERSONNEL. For a period of one year commencing
on the effective date of this Agreement, the Adviser and the Fund agree that the
retention of (i) the chief executive officer, president, chief financial officer
and secretary of the Adviser and (ii) each director, officer and employee of the
Adviser or any of its Affiliates (as defined in the Investment Company Act of
1940, as amended (the "1940 Act")) who serves as an officer of the Fund (each
person referred to in (i) or (ii) hereinafter being referred to as an "Essential
Person"), in his or her current capacities, is in the best interest of the Fund
and the Fund's shareholders. In connection with the Adviser's acceptance of
employment hereunder, the Adviser hereby agrees and covenants for itself and on
behalf of its Affiliates that neither the Adviser nor any of its Affiliates
shall make any material or significant personnel changes or replace or seek to
replace any Essential Person or cause to be replaced any Essential Person, in
each case without first informing the Board of Trustees of the Fund in a timely
manner. In addition, neither the Adviser nor any Affiliate of the Adviser shall
change or seek to change or cause to be changed, in any material respect, the
duties and responsibilities of any Essential Person, in each case without first
informing the Board of Trustees of the Fund in a timely manner.
(d) INDEPENDENT CONTRACTOR. The Adviser shall be deemed to be
an independent contractor under this Agreement and, unless otherwise expressly
provided or authorized, shall have no authority to act for or represent the Fund
in any way or otherwise be deemed as agent of the Fund.
(e) NON-EXCLUSIVE AGREEMENT. The services of the Adviser to
the Fund under this Agreement are not to be deemed exclusive, and the Adviser
shall be free to render similar services or other services to others so long as
its services hereunder are not impaired thereby.
2. (a) FEE. For the services and facilities described in Section 1, the
Fund will accrue daily and pay to the Advisor at the end of each calendar month
an investment management fee equal to 0.650% of the average daily managed assets
of the Fund (which for purposes of determining such fee, shall mean the average
daily value of the Fund, minus the sum of accrued liability other than the
aggregate amount of any borrowings undertaken by the Fund).
(b) DETERMINATION OF NET ASSET VALUE. The net asset value of
the Fund shall be calculated as of the close of the New York Stock Exchange on
the last day the Exchange is open for trading in each calendar week or such
other time or times as the trustees may determine in accordance with the
provisions of applicable law and the Declaration of Trust and By-Laws of the
Trust, and resolutions of the Board of Trustees of the Fund as from time to time
in force. For the purpose of the foregoing computations, on each such day when
net asset value is not calculated, the net asset value of a share of beneficial
interest of the Fund shall be deemed to be the net asset value of such share as
of the close of business of the last day on which such calculation was made.
(c) PRORATION. For the month and year in which this Agreement
becomes effective or terminates, there shall be an appropriate proration of the
Adviser's fee on the basis of the number of days that the Agreement is in effect
during such month and year, respectively.
3. EXPENSES. In addition to the fee of the Adviser, the Fund shall
assume and pay any expenses for services rendered by a custodian for the
safekeeping of the Fund's securities or other property, for keeping its books of
account, for any other charges of the custodian and for calculating the net
asset value of the Fund as provided above. The Adviser shall not be required to
pay, and the Fund shall assume and pay, the charges and expenses of its
operations, including compensation of the trustees (other than those who are
interested persons of the Adviser), charges and expenses of independent
accountants, of legal counsel and of any transfer or dividend disbursing agent,
costs of acquiring and disposing of portfolio securities, cost of listing shares
of the New York Stock Exchange or other exchange, interest (if any) on
obligations incurred by the Fund, costs of share certificates, membership dues
in the Investment Company Institute or any similar organization, costs of
reports and securities laws, miscellaneous expenses and all taxes and fees to
federal, state or other governmental agencies on account of the registration of
securities issues by the Fund, filing of corporate documents or otherwise. The
Fund shall not pay or incur any obligation for any management or administrative
expenses for which
the Fund intends to seek reimbursement from the Adviser without first obtaining
the written approval of the Adviser. The Adviser shall arrange, if desired by
the Fund, for officers or employees of the Adviser to serve, without
compensation from the Fund, as trustees, officers or agents of the Fund it duly
elected or appointed to such positions and subject to their individual consent
and to any limitations imposed by the law.
4. INTERESTED PERSONS. Subject to applicable statutes and regulations,
it is understood that trustees, officers, shareholders and agents of the Fund
are or may be interested in the Adviser as directors, officers, shareholders,
agents or otherwise and that the directors, officers, shareholders and agents of
the Adviser may be interested in the Fund as trustees, officers, shareholders,
agents or otherwise.
5. LIABILITY. The Adviser shall not be liable for any error of judgment
or of law, or for any loss suffered by the Fund in connection with the matters
to which this Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on the part of the Adviser in the
performance of its obligations and duties, or by reason of its reckless
disregard of its obligations and duties under this Agreement.
6. (a) TERM. This Agreement shall become effective on the date hereof
and shall remain in full force until May 31, 1999 unless sooner terminated as
hereinafter provided. This Agreement shall continue in force from year to year
thereafter, but only for so long as such continuance is specifically approved as
least annually, in the manner required by the 1940 Act.
(b) TERMINATION. This Agreement shall automatically terminate
in the event of its assignment. This Agreement may be terminated at any time
without the payment of any penalty by the Fund or by the Adviser on sixty (60)
days written notice to the other party. The Fund may effect termination by
action of the Board of Trustees or by vote of a majority of the outstanding
shares of stock of the Fund, accompanied by appropriate notice. This Agreement
may be terminated at any time without the payment of any penalty and without
advance notice by the Board of Trustees or by vote of a majority of the
outstanding shares of the Fund in the event that it shall have been established
by a court of competent jurisdiction that the Adviser or any officer or director
of the Adviser has taken any action which results in a breach of the covenants
of the Adviser set forth herein.
(c) PAYMENT UPON TERMINATION. Termination of this Agreement
shall not affect the right of the Adviser to receive payment on any unpaid
balance of the compensation described in Section 2 earned prior to such
termination.
7. SEVERABILITY. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder
shall not thereby affected.
8. NOTICES. Any notice under this Agreement shall be in writing,
addressed and delivered or mailed, postage prepaid, to the other party at such
address as such other party may designate for the receipt of such notice.
9. DISCLAIMER. The Adviser acknowledges and agrees that, as provided by
Section 5.5 of the Declaration of Trust of the Trust, the shareholders,
trustees, officers, employees and other agents of the Trust and the Fund shall
not personally be bound by or liable hereunder, nor shall resort be had to their
private property for the satisfaction of any obligation or claim hereunder.
10. GOVERNING LAW. All questions concerning the validity, meaning and
effect of this Agreement shall be determined in accordance with the laws
(without giving effect to the conflict-of-law principles thereof) of the State
of Delaware applicable to contracts made and to be performed in that state.
11. NAME. In connection with its employment hereunder, the Adviser
hereby agrees and covenants not to change its name without the prior consent of
the Board of Trustees of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below on the day and year first above
written.
XXX XXXXXX AMERICAN XXX XXXXXX AMERICAN CAPITAL
CAPITAL INVESTMENT ADVISORY CALIFORNIA VALUE MUNICIPAL
CORP. INCOME TRUST
By: /s/ Xxxxxx X. XxXxxxxxx By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. XxXxxxxxx Name: Xxxxxx X. Xxxxxx
Title: President Title: Secretary
AMENDMENT NUMBER ONE
TO THE
INVESTMENT ADVISORY AGREEMENT
This Amendment Number One, dated November 1, 2004, to the Investment
Advisory Agreement, dated May 31, 1997 (the" Agreement"), by and between Xxx
Xxxxxx California Value Municipal Income Trust (the "Fund"), a Massachusetts
business trust (the "Trust"), and Xxx Xxxxxx Asset Management (the "Adviser,"
successor in interest of Xxx Xxxxxx Investment Advisory Corp.), a Delaware
statutory trust, hereby amends the terms and conditions of the Agreement in the
manner specified herein.
WITNESSETH
WHEREAS the Board of Trustees of the Fund at a meeting held on
September 23,2004 has approved a reduction in the investment management fee
payable by the Fund to the Adviser; and
WHEREAS, the parties desire to amend and restate Section 2. (a) of the
Agreement relating to the investment management fee.
NOW THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements hereinafter contained, the parties hereby agree to
amend the Agreement, as follows:
Section 2.(a) of the Agreement is hereby deleted in its entirety and
replaced with the following:
2.(a) Fee. For the services and facilities described in
Section 1, the Fund will accrue daily and pay to the Adviser at the end
of each calendar month an investment management fee equal to 0.55% of
the average daily managed assets of the Fund (which for purposes of
determining such fee, shall mean the average daily value of the Fund,
minus the sum of accrued liability other than the aggregate amount of
any borrowings undertaken by the Fund).
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the day and year first above written.
XXX XXXXXX CALIFORNIA XXX XXXXXX ASSET MANAGEMENT
VALUE MUNICIPAL INCOME
TRUST
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxx X. Xxxx, III
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Xxxxxx X. Xxxxxxx Xxxxxx X. Xxxx, III
Executive Vice President and Principal Managing Director
Executive Officer
