SUB-ITEM 77Q1(e)
SUB-INVESTMENT ADVISORY AGREEMENT
October 9, 2002
Credit Suisse Asset Management (Australia) Limited
Xxxxx 00, Xxxxxxx Xxxxxxxx
0 Xxxxxxxxx Xxxxx
XXXXXX XXX 0000
Dear Sir/Madam:
The Indonesia Fund, Inc. (the "Fund"), a corporation
organized and existing under the laws of the State of
Maryland, and Credit Suisse Asset Management, LLC, as
investment adviser to the Fund ("CSAM"), herewith
confirms their agreement with Credit Suisse Asset
Management (Australia) Limited (the "Sub-Adviser"),
a company registered under the laws of the State
of Victoria, Australia, as follows:
1. Investment Description; Appointment
The Fund desires to employ the capital of the Fund by
investing and reinvesting in securities of the kind
and in accordance with the limitations specified in
the Fund's Articles of Incorporation, as may be
amended from time to time (the "Articles of
Incorporation"), and in the Fund's Registration
Statement, as from time to time in effect (the
?Registration Statement?) and in such manner
and to such extent as may from time to time
be approved by the Board of Directors of the
Fund. Copies of the Registration Statement
and Articles of Incorporation have been or
will be submitted to the Sub-Adviser. The
Fund agrees to promptly provide the
Sub-Adviser with copies of all amendments
to the Registration Statement on an
on-going basis. The Fund employs CSAM
as its investment adviser. CSAM
desires to employ and hereby appoints
the Sub-Adviser to act as its
sub-investment adviser upon the
terms set forth in this Agreement.
The Sub-Adviser accepts the
appointment and agrees to
furnish the services set
forth below for the compensation provided for herein.
2. Services as Sub-Investment Adviser
2.1 Subject to the supervision and direction of CSAM,
the Sub-Adviser will provide investment advisory and
portfolio management advice to all or that portion
of the Fund?s assets designated by CSAM from time
to time (the ?Assets?) in accordance with (a) the
Articles of Incorporation, (b) the Investment
Company Act of 1940, as amended (the "1940 Act"),
and the Investment Advisers Act of 1940, as
amended (the "Advisers Act"), and all applicable
Rules and Regulations of the Securities and
Exchange Commission (the "SEC") and all other
applicable laws and regulations, and (c) the
Fund's investment objective and policies as
stated in the Registration Statement and
investment parameters provided by CSAM
from time to time. In connection
therewith, the Sub-Adviser will:
(i) manage the Assets or furnish recommendations to
manage the Assets in accordance with the Fund?s
investment objective and policies;
(ii) make investment decisions or recommendations
with respect to the Assets;
(iii) if requested by CSAM will place purchase and
sale orders for securities on behalf of the Fund with
respect to the Assets;
(iv) exercise voting rights with respect to the
Assets if requested by CSAM; and
(v) furnish CSAM and the Fund's Board of Directors
with such periodic and special reports as the Fund
or CSAM may reasonably request.
In providing those services, the Sub-Adviser will, if requested
by CSAM, provide investment research and supervision of the
Assets and conduct a continued program of investment, evaluation
and, if appropriate, sale and reinvestment of the Assets.
2.2 In connection with the performance of the
services of the Sub-Adviser provided for herein,
the Sub-Adviser may contract at its own expense
with third parties for the acquisition of
research, clerical services and other administrative
services that would not require such parties to
be required to register as an investment adviser
under the Advisers Act; provided that the
Sub-Adviser shall remain liable for the
performance of its duties hereunder.
3. Execution of Transactions
3.1 In executing transactions for the Assets,
selecting brokers or dealers and negotiating
any brokerage commission rates, the Sub-Adviser
will use its best efforts to seek the best
overall terms available. In assessing the best
overall terms available for any portfolio
transaction, the Sub-Adviser will consider
all factors it deems relevant including, but
not limited to, the 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 for transactions executed through the
broker or dealer in the aggregate. In
selecting brokers or dealers to execute
a particular transaction and in evaluating
the best overall terms available, to the
extent that the execution and price
offered by more than one broker or
dealer are comparable the Sub-Adviser
may consider any brokerage and research
services (as those terms are defined
in Section 28(e) of the Secur
ities Exchange Act of 1934) provided to the Sub-Adviser or to
CSAM for use on behalf of the Fund or other clients of the
Sub-Adviser or CSAM.
3.2 It is understood that the services of the
Sub-Adviser are not exclusive, and nothing in
this Agreement shall prevent the Sub-Adviser
from providing similar services to other investment
companies or from engaging in other activities,
provided that those activities do not adversely
affect the ability of the Sub-Adviser to perform
its services under this Agreement. The Fund and
CSAM further understand and acknowledge that the
persons employed by the Sub-Adviser to assist in
the performance of its duties under this Agreement
will not devote their full time to that service.
Nothing contained in this Agreement will be
deemed to limit or restrict the right of the
Sub-Adviser or any affiliate of the
Sub-Adviser to engage in and devote time
and attention to other businesses or to
render services of whatever kind or
nature, provided that doing so does not
adversely affect the ability of the
Sub-Adviser to perform its services
under this Agreement.
3.3 On occasions when the Sub-Adviser deems the
purchase or sale of a security to be in the best
interest of the Fund as well as of other investment
advisory clients of the Sub-Adviser, the Sub-Adviser
may, to the extent permitted by applicable laws
and regulations, but shall not be obligated to,
aggregate the securities to be so sold or
purchased with those of its other clients.
In such event, allocation of the securities
so purchased or sold, as well as the expenses
incurred in the transaction, will be made by
the Sub-Adviser in a manner that is fair and
equitable, in the judgment of the
Sub-Adviser, in the exercise of its
fiduciary obligations to the Fund and
to such other clients. The Sub-Adviser
shall provide to CSAM and the Fund all
information reasonably requested by CSAM
and the Fund relating to the decisions
made by the Sub-Adviser regarding
allocation of securities purchased
or sold, as well as the expenses
incurred in a transaction, among
the Fund and the Sub-Adviser's other
invest
ment advisory clients.
3.4 In connection with the purchase and sale of
securities for the Fund, the Sub-Adviser will
provide such information as may be reasonably
necessary to enable the custodian and
co-administrators to perform their administrative
and recordkeeping responsibilities with respect
to the Fund.
4. Disclosure Regarding the Sub-Adviser
4.1 The Sub-Adviser has reviewed the disclosure
about the Sub-Adviser contained in the Fund?s
proxy statement used in seeking shareholder
approval for this Agreement and represents
and warrants that, with respect to such disclosure
about the Sub-Adviser or information related,
directly or indirectly, to the Sub-Adviser,
such proxy statement contains, as of the date
hereof, no untrue statement of any material
fact and does not omit any statement of a
material fact which is required to be
stated therein or necessary to make the
statements contained therein not misleading.
4.2 The Sub-Adviser agrees to notify CSAM and the Fund
promptly of (i) any statement about the Sub-Adviser
contained in the Registration Statement that becomes
untrue in any material respect, (ii) any omission of
a material fact about the Sub-Adviser in the
Registration Statement which is required to be
stated therein or necessary to make the statements
contained therein not misleading, or (iii) any
reorganization or change in the Sub-Adviser,
including any change in its ownership or key
employees .
(c) Prior to the Fund or CSAM or any affiliated
person (as defined in the 1940 Act, an "Affiliate")
of either using or distributing sales literature or
other promotional material referring to the
Sub-Adviser ("Promotional Material"), the Fund
or CSAM, where applicable, shall forward such
material to the Sub-Adviser and shall allow the
Sub-Adviser reasonable time to review the
material. The Sub-Adviser will not act
unreasonably in its review of Promotional
Material and the Fund or CSAM, where applicable,
will use all reasonable efforts to ensure that
all Promotional Material used or distributed
by or on behalf of the Fund or CSAM will
comply with the requirements of the Advisers
Act, the 1940 Act and the rules and
regulations promulgated thereunder.
4.4 The Sub-Adviser has supplied CSAM and the Fund
copies of its Form ADV with all exhibits and
attachments thereto and will hereinafter supply
CSAM and the Fund, promptly upon preparation
thereof, copies of all amendments or restatements
of such document.
5. Representations and Warranties
5.1 The Sub-Adviser represents and warrants that:
(a) it is a duly registered investment adviser under
the Advisers Act, a duly registered investment
adviser in any and all states of the United States
in which the Sub-Adviser is required to be so
registered and has obtained all necessary licenses
and approvals in order to perform the services
provided in this Agreement. The Sub-Adviser
covenants to maintain all necessary
registrations, licenses and approvals in
effect during the term of this Agreement.
(b) it has read and understands the Registration
Statement and warrants that in investing the Fund's
assets it will use all reasonable efforts to adhere
to the Fund's investment objectives, policies and
restrictions contained therein.
(c) it has adopted a written Code of Ethics in
compliance with Rule 17j-1 under the 1940 Act
and will provide the Fund with any amendments to
such Code.
5.2 The Fund represents and warrants that:
(a) it has full power to enter into the terms of
this Agreement and to enter into transactions
contemplated by this Agreement and that its
entry into the Agreement nor the exercise by
the Fund of its discretions or powers under
this Agreement will result in any default under
any contract or other agreement or instrument
to which the Fund is a party, or any statute or
rule, regulation or order of any governmental
agency or body applicable to the Fund.
(b) information which has been provided to the
Sub-Adviser in relation to the Fund?s status,
residence and domicile for taxation purposes is
complete and correct, and the Fund agrees to provide
any further information properly required by any
competent authority.
(c) it will notify the Sub-Adviser promptly if there
is any material change in any of the above information
and will provide such other relevant information as
the Sub-Adviser may reasonably request in order to
fulfill its regulatory and contractual obligations.
The Fund acknowledges that a failure to provide
such information may adversely affect the quality
of the services that the Sub-Adviser may provide.
5.3 CSAM represents and warrants that:
it has full power to enter into the terms of
this Agreement and to enter into transactions
contemplated by this Agreement and that neither
its entry into the Agreement nor the exercise
by CSAM of its discretions or powers under this
Agreement will result in any default under any
contract or other agreement or instrument to
which CSAM is a party, or any statute or rule,
regulation or order of any governmental
agency or body applicable to CSAM.
6. Compliance
6.1 The Sub-Adviser agrees that it shall promptly
notify CSAM and the Fund (i) in the event that the
SEC or any other regulatory authority has censured
its activities, functions or operations; suspended
or revoked its registration as an investment
adviser; or has commenced proceedings or an
investigation that may result in any of these
actions, (ii) in the event that there is a change
in the Sub-Adviser, financial or otherwise, that
adversely affects its ability to perform services
under this Agreement or (iii) upon having a
reasonable basis for believing that, as a
result of the Sub-Adviser's investing the
Fund's assets, the Fund's investment portfolio
has ceased to adhere to the Fund's investment
objectives, policies and restrictions as
stated in the Registration Statement or is
otherwise in violation of applicable law.
6.2 CSAM agrees that it shall promptly notify the
Sub-Adviser in the event that the SEC has censured
CSAM or the Fund; placed limitations upon any of
their activities, functions or operations; suspended
or revoked CSAM's registration as an investment
adviser; or has commenced proceedings or an
investigation that may result in any of these
actions.
6.3 The Fund and CSAM shall be given access to the
records with respect to the Fund of the Sub-Adviser
at reasonable times solely for the purpose of
monitoring compliance with the terms of this
Agreement and the rules and regulations applicable
to the Sub-Adviser relating to its providing
investment advisory services to the Fund, including
without limitation records relating to trading by
employees of the Sub-Adviser for their own
accounts and on behalf of other clients, provided
that such access does not constitute a breach
of any obligation of client confidentiality
held by the Sub-Adviser. The Sub-Adviser
agrees to cooperate with the Fund and CSAM
and their representatives in connection
with any such monitoring efforts.
7. Books and Records
7.1 In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Adviser hereby agrees that
all records which it maintains for the Fund are the
property of the Fund and further agrees to surrender
promptly to the Fund any of such upon request.
The Sub-Adviser further agrees to preserve for the
periods prescribed by Rule 31a-2 under the 1940
Act the records required to be maintained by Rule
31a-1 under the 1940 Act and to preserve the
records required by Rule 204-2 under the Advisers
Act for the period specified therein.
7.2 The Sub-Adviser hereby agrees to furnish to
regulatory authorities having the requisite authority
any information or reports in connection with services
that the Sub-Adviser renders pursuant to this
Agreement which may be requested in order to
ascertain whether the operations of the Fund
are being conducted in a manner consistent with
applicable laws and regulations.
8. Provision of Information; Proprietary and Confidential
Information
8.1 CSAM agrees that it will furnish to the
Sub-Adviser information related to or concerning
the Fund that the Sub-Adviser may reasonably request.
8.2 The Sub-Adviser agrees on behalf of itself and
its employees to treat confidentially and as
proprietary information of the Fund all records
and other information relative to the Fund, CSAM
and prior, present or potential shareholders and
not to use such records and information for any
purpose other than performance of its responsibilities
and duties hereunder except, where practicable,
after prior notification to and approval in writing
of the Fund, which approval shall not be
unreasonably withheld and may not be withheld
where the Sub-Adviser may be exposed to civil
or criminal contempt proceedings for failure
to comply or when requested to divulge such
information by duly constituted authorities.
8.3 The Sub-Adviser represents and warrants that
neither it nor any affiliate will use the name
of the Fund, CSAM or any of their affiliates in
any prospectus, sales literature or other material
in any manner without the prior written approval
of the Fund or CSAM, as applicable.
9. Standard of Care
The Sub-Adviser shall exercise its best judgment
in rendering the services described herein. The
Sub-Adviser shall not be liable for any error of
judgment or mistake of law or for any loss suffered
by the Fund or CSAM in connection with the matters
to which this Agreement relates, except that the
Sub-Adviser shall be liable for a loss resulting
from a breach of fiduciary duty by the
Sub-Adviser with respect to the receipt of
compensation for services; provided that
nothing herein shall be deemed to protect
or purport to protect the Sub-Adviser
against any liability to the Fund or
CSAM or to shareholders of the Fund
to which the Sub-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 by
reason of the Sub-Adviser's reckless
disregard of its obligations and
duties under this Agreement
(?disabling conduct?). The Fund
will indemnify the Sub-Adviser
against, and hold it harmless
from, any and all losses,
claims, damages, liabilities or expenses (including reasonable
counsel fees and expenses) not resulting from disabling conduct
by the Sub-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 Sub-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
Sub-Adviser was not liable by reason of disabling conduct
by (a) the vote of a majority of a quorum of directors of
the Fund who are neither ?interested persons? of the Fund
nor parties to the proceeding (?disinterested non-party
directors?) or (b) an independent legal counsel in a
written opinion. The Sub-Adviser shall be entitled
to advances from the Fund for payment of the reasonable
expenses incurred by it in connection with the matter
as to which it is seeking indemnification in the
manner and to the fullest extent permissible und
er the Maryland General Corporation Law. The Sub-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 Sub-Adviser shall provide 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 a quorum of the
full Board of Directors of the Fund, the members of
which majority are 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 CSAM will ultimately
be found to be entitled to indemnification. The
Fund and CSAM understand and agree that the
Sub-Adviser may rely upon information furnished
to it reasonably believed by the Sub-Adviser
to be accurate and reliable and, except as
herein provided, the Sub-Adviser shall not
be accountable for loss suffered by the
Fund by reason of such reliance of the
Sub-Adviser.
10. Compensation
In consideration of the services rendered pursuant
to this Agreement, CSAM will pay the Sub-Adviser
such amounts as the parties may agree upon from time
to time as set forth on Schedule A, as amended from
time to time.
11. Expenses
11.1 The Sub-Adviser will bear all expenses
in connection with the performance of its services
under this Agreement, which shall not include the
Fund's expenses listed in paragraph 11(b).
11.2 The Fund will bear certain other expenses
to be incurred in its operation, including: investment
advisory and administration fees; taxes, interest,
brokerage fees and commissions, if any; fees of
Directors of the Fund who are not officers,
directors, or employees of CSAM or the Sub-Adviser
or affiliates of any of them; fees of any pricing
service employed to value assets of the Fund;
SEC fees, state Blue Sky qualification fees
and any foreign qualification fees; charges
of custodians and transfer and dividend
disbursing agents; the Fund's proportionate
share of insurance premiums; outside
auditing and legal expenses; costs of
maintenance of the Fund's existence;
costs attributable to investor services,
including, without limitation, telephone
and personnel expenses: costs of
preparing and printing prospectuses
and statements of additional
information for regulatory purposes
and for distribution to existing
shareholders; costs of shareholders'
reports and meetings of the
shareholders of the Fund and
of the officers or Board of
Directors of the Fund; and any
extraordinary expenses.
12. Term of Agreement
This Agreement shall commence on the date first written
above and shall continue for an initial two-year period
commencing on the date first written above, and
thereafter shall continue automatically for successive
annual periods, provided such continuance is
specifically approved at least annually by
(a) the Board of Directors of the Fund or
(b) a vote of a "majority" (as defined in
the 0000 Xxx) of the Fund's outstanding
voting securities, provided that in either
event the continuance is also approved by
a majority of the Board of Directors who
are not "interested persons" (as defined
the 0000 Xxx) of any party to this
Agreement, by vote cast in person at a
meeting called for the purpose of voting
on such approval. This Agreement is
terminable, without penalty, (i) by
CSAM on 60 (sixty) days' written
notice to the Fund and the
Sub-Adviser, (ii) by the Board of
Directors of the Fund or by vote of
holders of a majority of the Fund's
shares on 60 (sixty) days' written
notice to CSAM and the
Sub-Adviser, or (iii) by the
Sub-Adviser upon 60 (sixty) days'
written notice to the Fund and
CSAM. This Agreement will also
terminate automatically in the
event of its assignment
(as defined in the 0000 Xxx)
by any party hereto. In
the event of termination
of this Agreement for any
reason, all records
relating to the Fund kept
by the Sub-Adviser shall
promptly be returned to
CSAM or the Fund, free
from any claim or
retention of rights
in such records by
the Sub-Adviser. In
the event this
Agreement is
terminated or is
not approved in
the foregoing
manner, the
provisions
contained in
paragraph
numbers 4(c),
7, 8 and 9
shall remain
in effect.
13. Amendments
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 amendment of this
Agreement shall be effective until approved by an
affirmative vote of (a) the holders of a majority
of the outstanding voting securities of the Fund
and (b) the Board of Directors of the Fund,
including a majority of Directors who are not
"interested persons" (as defined in the 0000
Xxx) of the Fund or of either party to this
Agreement, by vote cast in person at a
meeting called for the purpose of voting
on such approval, if such approval is required
by applicable law.
14. Notices
14.1 All communications hereunder shall be
given (a) if to the Sub-Adviser, to Credit Suisse
Asset Management (Australia) Limited, Xxxxx 00,
Xxxxxxx Xxxxxxxx, 0 Xxxxxxxxx Xxxxx, XXXXXX XXX
XXXXXXXXX (Attention: Xxxxxxx Xxxxxx), telephone:
000-0000-0000 facsimile: 000-0000-0000, email,
xxxxxxx.x.xxxxxx@xxxx.xxx (b) if to CSAM, to
Credit Suisse Asset Management, LLC, 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000 (Attention:
Xxx Xxxxxx), telephone: (000) 000-0000, telecopy:
(000) 000-0000, and (c) if to the Fund, c/o
Credit Suisse Funds, 000 Xxxxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000-0000, telephone: (212)
875-3500, telecopy: (000) 000-0000 (Attention:
President).
14.2 The Sub-Adviser may rely on, and act
without further enquiry upon, any instruction, notice
or request of any person(s) who is or who the
Sub-Adviser reasonably believes in good faith to be
person(s) designated by CSAM or the Fund to give
such instruction, notice or request, and further
provided that such instruction, notice or request
is made in writing and sent by original signed
letter, facsimile or electronic means in accordance
with the provisions of Clause 14.1.
14.3 CSAM and the Fund will provide a list of
person(s) who are authorized to give instructions
and sign documents and take other actions in respect
of the Assets. CSAM of the Fund shall notify the
Sub-Adviser promptly of any amendment to such list
and provide specimen signatures of new signatories,
and the Sub-Adviser shall accept any such
amendments.
15. Choice of Law
This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York in
the United States, including choice of law principles;
provided that nothing herein shall be construed in a
manner inconsistent with the 1940 Act, the Advisers
Act or any applicable rules, regulations or orders
of the SEC.
16. Miscellaneous
16.1 The captions of this Agreement are included
for convenience only and in no way define or limit any
of the provisions herein or otherwise affect their
construction or effect.
16.2 If any provision of this Agreement shall
be held or made invalid by a court decision, by statute
or otherwise, the remainder of this Agreement shall
not be affected thereby and, to this extent, the
provisions of this Agreement shall be deemed to be
severable.
16.3 Nothing herein shall be construed to make
the Sub-Adviser an agent of CSAM or the Fund.
16.4 This Agreement may be executed in
counterparts, with the same effect as if the signature
s were upon the same instrument.
******************
[signature page follows]
Please confirm that the foregoing is in accordance with
your understanding by indicating your acceptance hereof
at the place below indicated, whereupon it shall become a
binding agreement between us.
Very truly yours,
CREDIT SUISSE ASSET
MANAGEMENT, LLC
By: ___________________________
______
/s/ Xxx
Xxxxxx
Managing
Director
THE INDONESIA FUND, INC.
By: _________________________
________
/s/ Xxxxxxx X.
Xxxxxxxxx
Chief Financial
Officer
CREDIT SUISSE ASSET
MANAGEMENT (AUSTRALIA) LIMITED,
ABN 57 007 305 384, in accordance with its Articles of Association
______________________________
/s/ Xxxxxx XxXxxxxx
Director
______________________________
/s/ Xxxxxxx Xxxxxxxx
Director/Secretary
SCHEDULE A
CSAM will pay the Sub-Adviser a quarterly fee
equal to 90% of the net quarterly amount received
by CSAM as the Fund's investment adviser. Such fee
shall be payable in U.S. dollars in arrears on the
last business day of each calendar quarter. The
fee for the first period during which this
Agreement is in effect shall be pro-rated for
the portion of the calendar quarter that the
Agreement is in effect. The fee shall be as
aggregate fee paid for services rendered with
respect to this Fund.
