Exhibit (g)
INVESTMENT ADVISORY AGREEMENT
May , 2004
Gabelli Funds, LLC
Xxx Xxxxxxxxx Xxxxxx
Xxx, Xxx Xxxx 00000-0000
Dear Sir:
The Gabelli Global Utility & Income Trust (the "Fund"), a statutory
trust organized under the laws of the state of Delaware, confirms its
investment advisory agreement with Gabelli Funds, LLC (the "Adviser"), as
follows:
1. Investment Description; Appointment
The Fund desires to employ its capital by investing and reinvesting
in investments of the kind and in accordance with the limitations specified in
its Agreement and Declaration of Trust, as amended from time to time (the
"Declaration of Trust"), and in its Registration Statement on Form N-2 under
the Investment Company Act of 1940, (the "1940 Act") 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 Fund's Board of Trustees. Copies of
the Declaration of Trust and the Registration Statement in their form on the
date hereof have been submitted to the Adviser. The Fund desires to employ and
hereby appoints the Adviser to act as its investment adviser and to oversee
the administration of all aspects of the Fund's business and affairs and
provide, or arrange for others whom it believes to be competent to provide,
certain services as specified in subparagraph (b) below. The Adviser accepts
the appointment and agrees to furnish the services set forth below for the
compensation set forth below. Nothing contained herein shall be construed to
restrict the Fund's right to hire its own employees or to contract for
administrative services to be performed by third parties, including but not
limited to, the calculation of the net asset value of the Fund's shares.
2. Services
(a) Investment Advice. Subject to the direction and control of the
Fund's Board of Trustees, the Adviser will (i) act in conformity with the
Declaration of Trust, the 1940 Act and the Investment Advisers Act of 1940, as
the same may from time to time be amended, (ii) manage the Fund's assets in
accordance with the Fund's investment objective and policies as stated in the
Registration Statement, (iii) make investment decisions for the Fund, (iv)
exercise all voting rights in respect of the Fund's assets and (v) place
purchase and sale orders on behalf of the Fund. In rendering those services,
the Adviser will provide investment research and supervision of the Fund's
investments and conduct a continual program of investment, 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.
(b) Administration. The specific services to be provided or arranged
for by the Adviser for the Fund are (i) maintaining the Fund's books and
records, such as journals, ledger accounts and other records in accordance
with application laws and regulations to the extent not maintained by the
Fund's custodian, transfer agent or dividend disbursing agent; (ii) initiating
all money transfers to the Fund's custodian and from the Fund's custodian for
the payment of the Fund's expenses, investments, and dividends; (iii)
reconciling account information and balances among the Fund's custodian,
transfer agent, dividend disbursing agent and the Adviser; (iv) providing the
Fund, upon request, with such office space and facilities, utilities and
office equipment as are adequate for the Fund's needs; (v) preparing, but not
paying for, all reports by the Fund to its shareholders and all reports and
filings required to maintain registration and qualification of the Fund's
shares under federal and state law including the updating of the Fund's
Registration Statement, when necessary; (vi) supervising the calculation of
net asset value of the Fund's shares; and (vii) preparing notices and agendas
for meetings of the Fund's shareholders and the Fund's Board of Trustees as
well as minutes of such meetings in all matters required by applicable law to
be acted upon by the Board of Trustees.
3. Brokerage
In executing transactions for the Fund and selecting brokers or
dealers, the Adviser will seek best execution. In doing so, the 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 on a
continuing basis. In selecting brokers or dealers to execute a particular
transaction, the Adviser may consider the brokerage and research services
provided to the Fund and/or other accounts over which the Adviser or an
affiliate of the Adviser exercises investment discretion.
4. Information Provided to the Fund
The Adviser will 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.
5. Standard of Care
The Adviser shall exercise its professional judgment in rendering the
services described in paragraphs 2 and 3 above. The Adviser shall not be
liable for any error of judgment or mistake of law or for any loss suffered by
the Fund in connection with the matters of which this Agreement relates,
provided that nothing in this paragraph shall be deemed to protect or purport
to protect the Adviser against any liability to the Fund or to its
shareholders 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 by reason of the Adviser's reckless disregard of
its obligations and duties under this Agreement.
6. Compensation
In consideration of the services rendered pursuant to this Agreement,
the Fund will pay the Adviser, on the first business day of each month, a fee
for the previous month at an annual rate equal to a percentage set forth in
the fee schedule attached to this agreement as Appendix A of the Fund's
average weekly total assets. Upon any termination of this Agreement before the
end of a month, the fee for such part of that month shall be prorated
according to the proportion that such period bears to the full monthly period
and shall be payable upon the date of termination of this Agreement. For the
purpose of determining fees payable to the Adviser, the value of the Fund's
net assets shall be computed at the times and in the manner specified in the
Registration Statement.
7. Expenses
The Adviser will bear all expenses in connection with the performance
of its services under this Agreement. The Fund will bear certain other
expenses to be incurred in its operation, including: underwriting compensation
and reimbursements in connection with sales of its securities, expenses for
legal and independent accountants' services, costs of printing proxies, stock
certificates and shareholder reports, charges of the custodian, any
sub-custodian and transfer and dividend paying agent, expenses in connection
with the Automatic Dividend Reinvestment and Voluntary Cash Purchase Plan,
Securities and Exchange Commission fees, fees and expenses of unaffiliated
trustees, accounting and pricing costs, membership fees in trade associations,
fidelity bond coverage for the Fund's officers and employees, trustees and
officers' errors and omissions insurance coverage, interest, brokerage costs,
taxes, stock exchange listing fees and expenses, all expenses of computing the
Fund's net asset value per share, including any equipment or services obtained
solely for the purpose of pricing shares or valuing the Fund's investment
portfolios, expenses of qualifying the Fund's shares for sale in various
states, litigation and other extraordinary or non-recurring expenses, and
other expenses properly payable by the Fund.
8. Services to Other Companies or Accounts
The Fund understands that the Adviser now acts and will continue to
act as investment adviser to other investment companies and may act in the
future as investment adviser to other investment companies or portfolios, and
the Fund has no objection to the Adviser so acting, provided that whenever the
Fund and one or more other portfolios of or investment companies advised by
the Adviser and its affiliates have available funds for investment,
investments suitable and appropriate for each will be allocated in a manner
believed to be equitable to each and that whenever the Fund and one or more
other portfolios of or investment companies advised by the Adviser and its
affiliates desire to dispose of the same assets, such dispositions will be
allocated in a manner believed equitable to each. The Fund recognizes that in
some cases this procedure may adversely affect the size of the position
obtainable for the Fund. In addition, the Fund understands that the Adviser's
agents will not devote their full time to the discharge of its duties under
this Agreement 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.
9. Indemnity
(a) The Fund hereby agrees to indemnify the Adviser and each of the
Adviser's trustees, officers, employees, and agents (including any individual
who serves at the Adviser's request as director, officer, partner, trustee or
the like of another corporation) and controlling persons (each such person
being an "indemnitee") against any liabilities and expenses, including amounts
paid in satisfaction of judgments, in compromise or as fines and penalties,
and counsel fees (all as provided in accordance with applicable corporate law)
reasonably incurred by such indemnitee in connection with the defense or
disposition of any action, suit or other proceeding, whether civil or
criminal, before any court or administrative or investigative body in which he
may be or may have been involved as a party or otherwise or with which he may
be or may have been threatened, while acting in any capacity set forth above
in this paragraph or thereafter by reason of his having acted in any such
capacity, except with respect to any matter as to which he shall have been
adjudicated not to have acted in good faith in the reasonable belief that his
action was in the best interest of the Fund and furthermore, in the case of
any criminal proceeding, so long as he had no reasonable cause to believe that
the conduct was unlawful, provided, however, that (1) no indemnitee shall be
indemnified hereunder against any liability to the Fund or its shareholders or
any expense of such indemnitee arising by reason of (i) willful misfeasance,
(ii) bad faith, (iii) gross negligence, (iv) reckless disregard of the duties
involved in the conduct of his position (the conduct referred to in such
clauses (i) through (v) being sometimes referred to herein as "disabling
conduct"), (2) as to any matter disposed of by settlement or a compromise
payment by such indemnitee, pursuant to a consent decree or otherwise, no
indemnification either for said payment or for any other expenses shall be
provided unless there has been a determination that such settlement or
compromise is in the best interests of the Fund and that such indemnitee
appears to have acted in good faith in the reasonable belief that his action
was in the best interest of the Fund and did not involve disabling conduct by
such indemnitee and (3) with respect to any action, suit or other proceeding
voluntarily prosecuted by any indemnitee as plaintiff, indemnification shall
be mandatory only if the prosecution of such action, suit or other proceeding
by such indemnitee was authorized by a majority of the full Board of the Fund.
Notwithstanding the foregoing the Fund shall not be obligated to provide any
such indemnification to the extent such provision would waive any right which
the Fund cannot lawfully waive.
(b) The Fund shall make advance payments in connection with the
expenses of defending any action with respect to which indemnification might
be sought hereunder if the Fund receives a written affirmation of the
indemnitee's good faith belief that the standard of conduct necessary for
indemnification has been met and a written undertaking to reimburse the Fund
unless it is subsequently determined that he is entitled to such
indemnification and if the trustees of the Fund determine that the facts then
known to them would not preclude indemnification. In addition, at least one of
the following conditions must be met: (A) the indemnitee shall provide a
security for his undertaking, (B) the Fund shall be insured against losses
arising by reason of any lawful advances, or (C) a majority of a quorum of
trustees of the Fund who are neither "interested persons" of the Fund (as
defined in Section 2(a)(19) of the Act) nor parties to the proceeding
("Disinterested Non-Party Trustees") or an independent legal counsel in a
written opinion, shall determine, based on a review of readily available facts
(as opposed to a full trial-type inquiry), that there is reason to believe
that the indemnitee ultimately will be found entitled to indemnification.
(c) All determinations with respect to indemnification hereunder
shall be made (1) by a final decision on the merits by a court or other body
before whom the proceeding was brought that such indemnitee is not liable by
reason of disabling conduct or, (2) in the absence of such a decision, by (i)
a majority vote of a quorum of the Disinterested Non-party Trustees of the
Fund, or (ii) if such a quorum is not obtainable or even, if obtainable, if a
majority vote of such quorum so directs, independent legal counsel in a
written opinion.
The rights accruing to any indemnitee under these provisions shall
not exclude any other right to which he may be lawfully entitled.
10. Use of the Word "Gabelli"
It is understood and agreed that the word "Gabelli" is the Adviser's
property for copyright and other purposes. The Fund further agrees that the
word "Gabelli" in its name is derived from the name of Xxxxx X. Xxxxxxx and
such name may freely be used by the Adviser for other investment companies,
entities or products. The Fund further agrees that, in the event that the
Adviser shall cease to act as an investment adviser to the Fund, the Fund
shall promptly take all necessary and appropriate action to change its name to
one that does not include the word "Gabelli"; provided, however, that the Fund
may continue to use such name if the Adviser consents in writing to such use.
11. Term of Agreement
This Agreement shall become effective on the date it is approved by
the sole shareholder or the shareholders of the Fund and shall continue in
effect for two years and thereafter shall continue for successive annual
periods, provided such continuance is specifically approved at least annually
in accordance with the requirements of the 1940 Act. This Agreement is
terminable, without penalty, on 60 days written notice by the Fund's Board of
Trustees, by vote of holders of a majority of the Fund's shares, or by the
Adviser. This Agreement will also terminate automatically in the event of its
assignment (as defined in the 1940 Act and the rules thereunder).
12. Amendment
The Adviser and the Fund may amend this Agreement without shareholder
approval so long as such amendment does not materially change the advisory
relationship between the Adviser and the Fund.
If the foregoing is in accordance with your understanding, kindly
indicate your acceptance of this Agreement by signing and returning the
enclosed copy.
Very truly yours,
THE GABELLI GLOBAL UTILITY
& INCOME FUND
By:
------------------------------
Name:
Title:
Agreed to and Accepted:
GABELLI FUNDS, LLC
By:
------------------------------
Name:
Title:
APPENDIX A
FEE SCHEDULE
The following percentages shall apply during the time periods
indicated for the purpose of calculating the Adviser's fee under section 6 of
the Investment Advisory Agreement:
1.00% from the commencement of the Fund's investment operations until the fifth
anniversary of such date;
.90% from its fifth anniversary until the sixth anniversary;
.80% from its sixth anniversary until the seventh anniversary;
.70% from its seventh anniversary until the eight anniversary; and
.50% for each year following the eighth anniversary.
