EXHIBIT (2)(g)(3)
THE THAI FUND, INC.
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INVESTMENT CONTRACT
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TABLE OF CONTENTS
PAGE
1. Definitions.........................................................1
2. Establishment of The Fund...........................................2
3. Basic Obligations and Rights of the Manager.........................3
4. Enforcement by Unitholder...........................................4
5. Units...............................................................4
6. Calculation of Net Asset Value......................................4
7. Investment Objectives, Policies and Limitations.....................5
8. Duration, Changes in Manager and Custodian, and Termination.........6
9. Accounts and Statements.............................................7
10. Distributions.......................................................8
11. Payments............................................................8
12. Currency............................................................9
13. Council.............................................................9
14. Information and Notices............................................11
15. Amendments.........................................................12
16. Governing Law, Jurisdiction; Language and Miscellaneous............12
Exhibits
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A Technical Assistance and Seconding Agreement
B Form of Certificate
C Form of Council Agreement
Investment Contract (the "Investment Contract") dated as of June 1,
1997 by and among THE MUTUAL FUND PUBLIC COMPANY LIMITED ("MFC"), a Thai limited
company, with its principal place of business located at 30th-32nd Floor, Lake
Rajada Building, ▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇-▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇,
Thailand, and THE THAI FUND, INC. (the "Unitholder"), a Maryland corporation,
with its principal place of business located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
1. Definitions
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In this Investment Contract, the following terms have the following
meanings:
"Advisory Sections" means Sections 3.1; 3.3; 3.4; 3.8; Article 8 (other
than Section 8.2(b)(Y) and Section 8.5, insofar as such Section relates to
appointment of liquidators under Thai law); and Article 15 (other than Section
15.1(b)(Y));
"Assets" means all assets held by the Fund, including but not limited
to Thai Securities;
"Auditors" has the meaning ascribed thereto in Section 9.4(a);
"Beneficial Certificate" has the meaning ascribed thereto in Section
5.2;
"Board of Directors" means the Board of Directors of the Unitholder;
"BOT" means the Bank of Thailand or any successor agency or institution
of the Royal Thai Government from time to time authorized by law to supervise
mutual funds in Thailand;
"Business Day" means a day on which the SET and the New York Stock
Exchange are both open for business;
"Council" has the meaning ascribed thereto in Section 13.A.1;
"Custodian" means The Thai Farmers Bank Limited or its successors or
permitted assigns under the Thai Custody Contract;
"District Court" has the meaning ascribed thereto in Section 16.3;
"Dollars" means U.S. dollars;
"Effective Date" means the date on which the Registration Statement is
first declared effective by the SEC under the United States Securities Act of
1933, as amended;
"Financial Statements" has the meaning ascribed thereto in Section 9.2;
"Fund" means the project established by this Agreement;
"Funds" means the Fund and the Unitholder, jointly and severally, as if
such entities were one entity;
"Investment Company Act" means the United States Investment Company Act
of 1940, as amended;
"Manager" means MFC or any successor thereto permitted under U.S. Law;
"Registration Statement" means the Unitholder's registration statement
on Form N-2 filed with the SEC;
"SEC" means the United States Securities and Exchange Commission;
"Securities" means all securities held by the Fund pursuant to this
Investment Contract;
"SET" has the meaning ascribed thereto in Section 6.2(a);
"Supreme Court" has the meaning ascribed thereto in Section 16.3;
"Technical Assistance and Seconding Agreement" has the meaning ascribed
thereto in Section 3.1;
"Thai Custody Contract" means the Custody Contract among the
Unitholder, the Manager and the Custodian in respect of the Fund;
"Thai NAV" has the meaning ascribed thereto in Section 6.1;
"Thai Securities" means all Securities of Thai companies held by the
Fund pursuant to this Agreement;
"Underwriting Agreement" means the Underwriting Agreement in respect of
the unitholder's shares of common stock ($0.01 par value) executed on or about
the date hereof;
"United States" means the United States of America (including the
States and the District of Columbia), its territories, its possessions and other
areas subject to its jurisdiction;
"Unitholder" means The Thai Fund, Inc., a Maryland corporation;
"U.S. GAAP" has the meaning ascribed thereto in Section 6.5;
"U.S. Law" means applicable United States federal law (including the
Internal Revenue Code, Securities Act of 1933, Securities Exchange Act of 1934,
Investment Company Act and Investment Advisers Act of 1940, each as from time to
time amended) and New York law;
"U.S. Sections" shall mean the Advisory Sections and Sections 2.1 (with
respect to U.S. Law); 2.2; 3.6 (except 3.6(b)); 3.7; Article 4 (with respect to
U.S. Law); Section 5.3; Article 6 (with respect to U.S. GAAP and U.S. Law);
Article 7 (except 7(2)); Article 9 (other than Sections 9.1(b)(ii) and 9.3);
Section 11.1; Article 10; Article 12; Article 13 (with respect to U.S. Law);
Section 14.B; and Article 16;
"Valuation Date" has the meaning ascribed thereto in Section 6.1.
2. Establishment of The Fund
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2.1 The Fund was established as a securities investment fund with
effect on and from the Effective Date under the laws of the Kingdom of Thailand
for the exclusive benefit of the Unitholder. This Investment Contract, together
with the exhibits hereto and the relevant provisions of the laws and regulations
of the Kingdom of Thailand, and, with respect to the U.S. Sections, U.S. Law
alone, shall govern the relationships, which are contractual relationships,
between the Manager and the Unitholder.
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2.2 The Unitholder shall be liable for all liabilities incurred by or
on behalf of the Fund in accordance with the terms of this Investment Contract
and the Technical Assistance and Seconding Agreement, provided, however, that
this Section 2.2 shall not operate to enlarge in any way any liabilities
incurred by or on behalf of the Fund.
3. Basic Obligations and Rights of the Manager
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3.1 (a) The Manager, as investment manager to the Fund, hereby
undertakes and agrees, upon the terms and conditions herein set forth in this
Investment Contract, to manage the acquisition, holding and disposition of
Assets, in accordance with the investment objectives and policies as set forth
in or contemplated by this Investment Contract and in accordance with
supervision and instructions of the Board of Directors and to prepare and make
available to the Unitholder research and statistical data in connection
therewith; subject, however, in all respects to the terms and conditions of the
Technical Assistance and Seconding Agreement attached hereto as Exhibit A, which
agreement shall be executed and delivered by the Manager simultaneously
herewith.
(b) For purposes of this Investment Contract, "instructions from the
Board of Directors" shall include the right to request a power of attorney from
the Manager in order to enforce claims of, or to defend claims against, the
Fund.
3.2 The Manager agrees to act hereunder in such capacity or capacities
as are necessary or appropriate under Thai law, including with respect to the
establishment of the Fund pursuant to Section 2.1 hereof. It is expressly agreed
that the Manager shall hold legal title to all Assets and that nothing herein
shall constitute the Manager, or require it to act as, agent, nominee or trustee
of the Unitholder with respect to legal title to Thai Securities. The Manager
shall hold legal, title to all Assets separate from its own assets, free and
clear of all liens, claims and encumbrances of any party except as provided by
this Investment Contract.
3.3 The Manager shall be entitled to be paid in Baht from the assets of
the Funds, as full compensation for the services rendered and expenses borne by
the Manager under the Advisory Sections hereunder and under the Technical
Assistance and Seconding Agreement, a monthly fee, payable, except as provided
below, within three Bangkok business days of the first day of each month
following the day on which such payment is computed, equal to 1/12 of 0.40% of
the value of the average weekly net assets of the Funds up to and including $50
million, plus 1/12 of 0.25% of the value of the next $50 million of the average
weekly net assets of the Funds, plus 1/12 of 0.20% of the value of the average
weekly net assets of the Funds over $100 million. The weekly net assets of the
Funds for a month shall be determined as of the close of business in New York on
the last New York Stock Exchange business day of each week where such last
business day falls within one month, and be averaged by dividing the total of
such weekly net assets by such number of such weeks in such month. Such fee
shall be payable from the Funds and shall be computed beginning on the "Closing
Date" (as defined in the Underwriting Agreement) until the termination of this
Investment Contract for whatever reason. The fee from the Closing Date to the
end of the month during which the Closing Date occurs shall be prorated
according to the proportion which such period bears to the full monthly period.
Upon the termination of the Advisory Sections before the end of any month, such
fee for such part of a month shall be prorated according to the proportion which
such period bears to the full monthly period, and shall be payable on the date
of termination of the Advisory Sections. For the purposes of this Investment
Contract, the net assets of the Funds shall be computed pursuant to the
directions of the Board of Directors.
3.4 The Manager agrees to pay, for the benefit of the Funds, certain
fees and expenses with respect to the Funds, as further provided by the
Technical Assistance and Seconding Agreement.
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3.5 The Manager's services hereunder are not to be deemed exclusive and
the Manager is free to render similar services to others.
3.6 The Manager represents and warrants that it is duly (a) registered
and authorized as an investment adviser under the U.S. Investment Advisers Act
of 1940, as amended, and (b) licensed as an investment manager under the
Operation of Finance, Securities and Credit Foncier Companies of Thailand, B.E.
2522, and it agrees to maintain effective registration, authorization and
license, as the case may be, thereunder until the termination of the Advisory
Sections.
3.7 Neither the Manager nor any affiliate of the Manager shall receive
any compensation in connection with the placement or execution of any
transaction for the purchase or sale of securities or for the investment of
funds on behalf of the Fund, except that the Manager or the Manager's affiliates
may receive a commission, fee or other remuneration for acting as broker in
connection with the sale of securities to or by the Fund, but only to the extent
permitted under the Investment Company Act.
3.8 The Manager may rely on information reasonably believed by the
Manager to be accurate and reliable. Neither the Manager, the Manager's
officers, directors, employees, agents or any controlling persons as defined in
the Investment Company Act shall be subject to any liability for any act or
omission, error of judgment or mistake of law or for any loss suffered by the
Funds in the course of, connected with or arising out of any services to be
rendered hereunder except by reason of willful misfeasance, bad faith or gross
negligence in the performance of the Manager's duties or by reason of reckless
disregard on the part of the Manager of the Manager's obligations and duties
under this Investment Contract.
4. Enforcement by Unitholder
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The Unitholder shall have the right at all times to enforce against the
Manager the obligations of the Manager under this Investment Contract, and to
enforce the obligations of the Manager, as Thai Manager, under the Technical
Assistance and Seconding Agreement.
5. Units
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5.1 Units shall be issued to the Unitholder against payment therefor
with respect to all transfers of any assets to the Fund. The value of Units
shall, upon the initial transfer of any assets to the Fund, be $10.00, provided,
however, that the value of Units shall thereafter be determined in accordance
with Article 6 of this Investment Contract. Units shall not represent any right
in respect of any particular Assets but shall represent undivided interests of
equal value as further determined pursuant to Article 6.
5.2 Beneficial certificates (the "Beneficial Certificates")
representing one or more Units, in substantially the form of Exhibit B attached
hereto, shall be issued to the Unitholder in respect of all Units issued to the
Unitholder. Each Beneficial Certificate shall be signed on behalf of the
Manager.
5.3 Units are not transferable The Manager shall not issue or deliver a
Unit or a Beneficial Certificate to any person other than the Unitholder. The
Unitholder may not transfer or assign Units or Beneficial Certificates.
6. Calculation of Net Asset Value
6.1 The net asset value of the Assets (the "Thai NAV") at any time
shall be the value of the Assets less the liabilities of the Fund at such time.
The net asset value of Units at any time following the initial issuance thereof
as described in Section 5.1 shall be the Thai NAV divided by the number of Units
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issued and outstanding as of such time. The Thai NAV shall be calculated by the
Unitholder's designee at the close of each week in Bangkok (a "Valuation Date")
as well as when required for the issue of Units pursuant to Article 5 hereof.
The Thai NAV shall be calculated by reference to the criteria set forth below
(and such other criteria as maybe determined from time to time by the Board of
Directors).
6.2 The value of assets held in the Fund shall be determined as
follows:
(a) where the assets are equity securities listed and traded on the
Stock Exchange of Thailand (the "SET") and SET market quotations are readily
available, at the last sales price on such exchange on the applicable Valuation
Date or, if there is no sale on such exchange on that date, the mean between the
highest current bid and the lowest current asked prices;
(b) where the assets are unlisted equity securities, at the mean
between current bid and asked prices, if any, of two reputable dealers;
(c) short-term investments having a maturity of 60 days or less will be
valued at cost with accrued interest or discount earned included in interest
receivable;
(d) securities which are listed on exchanges other than the SET and
other securities as to which market quotations are readily available shall be
valued at their market values; and
(e) all other securities and assets will be taken at fair value in
accordance with procedures determined by the Board of Directors.
6.3 In instances where price cannot be determined in accordance with
the above procedures, or in instances in which the Board of Directors determines
that it is impracticable or inappropriate to determine price in accordance with
the above procedures, the price will be determined in such manner as the Board
of Directors may prescribe.
6.4 There shall be made such allowance (if any) as the Board of
Directors may consider appropriate in the case of any asset which the Board of
Directors considers may not be fully recoverable.
6.5 For purposes of determining the Thai NAV, liabilities shall include
the amount of any fee payable to the Manager hereunder or the Custodian under
the Thai Custody Contract and any fee payable pursuant to the Technical
Assistance and Seconding Agreement or other fees and expenses if, at the
direction of the Board of Directors, such fees and expenses are to be paid from
the assets of the Fund and accrued at or accruing to the applicable Valuation
Date but remaining unpaid. Other liabilities shall be determined in accordance
with United States generally accepted accounting principles ("U.S. GAAP").
6.6 Notwithstanding anything in this Agreement, (a) for purposes of all
reporting required under U.S. Law, the "Unitholder's designee" as used in this
Article 6 shall be United States Trust Company of New York, which shall
determine the Thai NAV in Dollars based upon information supplied by the Manager
and/or the Custodian, and (b) for purposes of all reporting required under Thai
law, the "Unitholder's designee" as used in this Article 6 shall be the Manager,
which shall determine the Thai NAV in Baht based upon information from United
States Trust Company of New York.
7. Investment Objectives, Policies and Limitations
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The investment objectives, policies and limitations of the Funds will
be as described in the Registration Statement on the Effective Date, subject to
revision in accordance with (1) U.S. Law and (2) Thai law.
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8. Duration, Changes in Manager and Custodian, and Termination
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8.1 This Investment Contract shall become effective on the date hereof.
This Investment Contract, other than the Advisory Sections hereof, shall
continue in effect, if not continued in accordance with applicable U.S. Law and
Thai law, until December 25, 2012, or until terminated in accordance with
Section 8.4. The Advisory Sections shall continue in effect, if not continued in
accordance with applicable U.S. Law as further provided below, until two years
from the date hereof. If not sooner terminated, the Advisory Sections shall
continue in effect for successive periods of 12 months each thereafter; provided
that each such continuance shall be specifically approved annually by the vote
of a majority of the Board of Directors who are not parties to this Investment
Contract or interested persons (as such term is defined in the Investment
Company Act) of any such party, cast in person at a meeting called for the
purpose of voting on such approval and (a) either the vote of a majority of the
outstanding voting securities of the Unitholder, or (b) a majority of the Board
of Directors as a whole.
8.2 Notwithstanding anything in this Agreement to the contrary, the
Advisory Sections may be terminated at any time by the Unitholder, without the
payment of any penalty, upon a vote of a majority of the Board of Directors or a
majority of the outstanding voting securities of the Unitholder, or by the
Manager, on 60 days' written notice to the other parties. The Advisory Sections
shall automatically terminate (a) in the event of assignment of this Investment
Contract (as such term is defined in the Investment Company Act); (b)
termination of the Technical Assistance and Seconding Agreement; or (c) the
suspension or revocation of the Manager's license or status to act as manager to
the Fund or the Unitholder, under (X) U.S. Law, or (Y) Thai law, as the case may
be. Any notice shall be deemed given when received by the addressee.
8.3 Upon termination of the Advisory Sections, except as provided by
Section 8.4 hereof, the Unitholder shall, in accordance with (a) U.S. Law, and
(b) Thai law, provide for a successor manager to execute, as investment manager
under, an agreement in substance similar to the Advisory Sections of this
Investment Contract (which may be evidenced by an agreement to become party to
all provisions of this Investment Contract) and to the Technical Assistance and
Seconding Agreement, with all such changes, however, as the parties thereto
shall agree upon.
8.4 This Investment Contract, including the Advisory Sections, shall
terminate if:
(a) There is any transfer, assignment or other disposition of any of
the Unitholder's interest in the Fund, or any delivery of a Unit or Beneficial
Certificate to any person other than the Unitholder;
(b) The Manager notifies the Unitholder in writing that due to a change
in Thai law, in its opinion further operation of the Fund in accordance with
this Investment Contract is illegal or infeasible having regard solely to the
interests of the Unitholder;
(c) There has been a suspension of trading for more than 1 day on the
Securities Exchange of Thailand; the declaration by Thailand authorities of a
banking moratorium; or any war, blockade, embargo, insurrection or armed
conflict or escalation of any thereof involving Thailand or the United States,
if in any such case the Board of Directors determines that termination is in the
best interests of Unitholder;
(d) Termination of the Custodian's appointment pursuant to the Thai
Custody Contract if no successor custodian is appointed thereunder or otherwise;
(e) A court having jurisdiction in the premises shall enter a decree or
order for relief in respect of the Unitholder or the Manager in any involuntary
case under any applicable bankruptcy,
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insolvency or other similar law now or hereafter in effect, or appoint a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of the Unitholder or the Manager, as the case may be or for any
substantial part of the property thereof, or order the winding-up or liquidation
of the affairs thereof;
(f) The Unitholder or the Manager shall commence a voluntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or shall consent to the entry of an order for relief in an involuntary
case under any such law, or shall consent to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of the Unitholder or the Manager, as the case may be, or
for any substantial part of the property thereof, or shall make any general
assignment for the benefit of creditors thereof, or shall fail generally to pay
its debts as they become due; or
(g) Upon the termination of the Advisory Sections if no successor
investment manager is appointed pursuant to Section 8.3.
8.5 Upon termination of this Investment Contract pursuant to Section
8.4, the Fund will be liquidated by a liquidator appointed by the Manager acting
upon the instructions and under the supervision of the Board of Directors. Such
liquidation will in an orderly manner dispose of Thai Securities which are
restricted as to foreign ownership and remit the proceeds thereof to the
Unitholder and, unless directed by the Board of Directors otherwise, cause all
other assets of the Fund to be registered in the name of Unitholder. To the
extent that the Unitholder does not take action in respect of Sections 5.3 and
8.4(a), (e) and (f) hereof, the Manager will take all actions necessary to
effectuate such sections and this Section 8.5.
8.6 This Investment Contract may not be transferred, assigned, sold or
in any matter hypothecated or pledged by any party hereto other than as
permitted by Article 8 hereof.
8.7 As used in this Investment Contract, the phrase "majority of the
outstanding voting securities of the Unitholder" shall mean the affirmative vote
of the holders of a majority of the outstanding voting securities of the
Unitholder, cast in person at a meeting called for the purpose of voting on such
approval.
9. Accounts and Statements
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9.1 (a) The Manager shall maintain in its principal office in Bangkok
sufficient accounts and records to enable a complete and accurate view to be
formed by the Unitholder or its designee of the Assets and liabilities and the
income and expenditures of the Fund.
(b) Such accounts shall be kept in form necessary in order to prepare
financial statements (i) pursuant to U.S. GAAP and, (ii) in addition may be kept
in such form and language required by the BOT.
9.2 The Unitholder or its designee shall prepare financial statements
of the Funds for successive accounting periods, each accounting period
commencing immediately after the end of the last preceding such accounting
period (or in the case of the first such period from the date of establishment
of the Funds) and ending on December 31 in each year (the first such date being
December 31, 1988) (the "Financial Statements") and shall also prepare such
Financial Statements as of and for the monthly periods ending on the last day of
each calendar month (which monthly reports shall be prepared within ten business
days after the end of each month), in each case in U.S. dollars on the basis of
U.S. GAAP on
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the respective forms and containing the information for the time being required
by the SEC and the New York Stock Exchange.
9.3 The Manager or its designee shall prepare financial statements of
the Fund in the manner required by Thai law and shall make or cause to be made
all reports, publications, notices and filings with respect to the Fund required
by Thai law.
9.4 Audit. The Manager and the Unitholder shall:
(a) cause the Financial Statements to be audited in accordance with
U.S. GAAP by an internationally recognized accountancy firm authorized under the
laws of the Kingdom of Thailand and the regulations of the BOT (the "Auditors").
The initial Auditors shall be Price Waterhouse. The Manager shall be entitled,
with the prior written approval of the Board of Directors, and the Board of
Directors and the shareholders of the Unitholder, to remove any person or firm
of Auditors and appoint another internationally recognized accountancy firm to
be the Auditors. The Manager and the Board of Directors shall ensure that at all
times there are such Auditors for the Fund;
(b) submit the Financial Statements together with the Auditors' report
and such report as the Manager may intend to make to the Unitholder thereon to
the Unitholder and the BOT; and
(c) comply with such requirements as the SEC may make with respect to
such statements and report.
9.5 Form of Auditor's Reports. The Auditors' report on the Financial
Statements of the Funds shall be in the form required by the SEC and the New
York Stock Exchange and prepared in accordance with U.S. GAAP. The Manager shall
sign all Financial Statements, if requested to do so by the Board of Directors.
A manager of the Auditors shall sign all Financial Statements of the Fund.
10. Distributions
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10.1 The Fund will distribute to the Unitholder, at least once each
year (on such dates as is determined by the Board of Directors), all or part of
the net profit of the Fund for such year. For this purpose, the net profit of
the Fund will be calculated in Dollars and will include dividends and interest
paid with respect to Securities, interest on bank deposits, net capital gains
from the sale of Securities and any other income arising from the Fund's
operations, less all expenses of the Investment Plan.
Except with respect to payment of expenses as may be further provided
in Section 10.2, the Fund shall not make any distribution to the Unitholder
except out of current net profits or accumulated prior years' net profits not
previously distributed, or otherwise as may be declared by the Board of
Directors and permitted by the BOT.
10.2 Costs and expenses are payable and distributable out of the assets
of the Fund when and as determined by the Board of Directors.
10.3 Each shareholder of the Unitholder, shall, unless he elects
otherwise, reinvest all distributions he receives from the ▇▇▇▇▇▇▇▇▇▇.
▇▇. Payments
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11.1 Any moneys payable to the Manager or others by the Fund shall be
paid, upon order of the Unitholder (or its authorized designee acting in
accordance with the Thai Custody Contract), in the
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manner and to a Baht (or Dollar, subject to Section 11.2 hereof) account
notified by the Unitholder (or its authorized designee acting in accordance with
the Thai Custody Contract).
11.2 All payments to be made in currencies other than Baht are subject
to Thai law including exchange control law and regulations thereunder.
12. Currency
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Except as otherwise provided in this Investment Contract, the accounts
and records of the Fund, payments into the Fund and payments out of the Fund
shall be made in Baht. Distributions from the Fund shall be calculated in
Dollars. The Financial Statements of the Funds shall be prepared in Dollars,
provided, however, that financial statements may also be prepared as provided in
Section 9.3 hereof. Currency exchange rates between Baht and Dollars for
purposes of the Fund's accounts and records shall be determined by the Board of
Directors.
13. Council
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A. Duties of Council
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13.A.1. Until the termination of the Fund, a Council (the
"Council") shall be constituted and organized as hereinafter provided.
13.A.2. The functions of the Council, subject to the Thai law and
U.S. Law and this Investment Contract, and all other relevant legislation and
regulation, shall be to:
(a) consult with the Manager on Thailand economic and securities
market matters; and
(b) exercise such other powers and rights as are provided
hereunder.
B. Agreements with Council Members
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The Manager, subject to the oversight of the Board of Directors,
shall be authorized to enter into an agreement with each of the initial members
of the Council which shall be binding upon each of them and their successors, to
implement the terms and conditions contained herein in relation to the Council
and the members and for the exercise of the rights, powers and duties vested in
the Council and the members. Such agreement shall be executed on or before the
Effective Date, shall be in the form set out in Exhibit C and shall be capable
of variation only with the approval of the Board of Directors.
C. Meetings, Composition and Retirement
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13.C.1. The members of the Council shall initially consist of the
persons listed below. The number of members of the Council shall be 5.
The members are initially expected to be:
Snoh Unakul
Sukri Kaocharern
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Udom Vichayabhai
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13.C.2. The members of the Council may from time to time appoint
any person to be a member of the Council to replace a vacancy, provided that
prior thereto the Board of Directors and a majority of the members respectively
shall have given their respective approvals to such appointment. Such approvals
shall be appropriately reflected in the records of the Fund.
13.C.3. The office of a member of the Council shall be vacated in
any of the following events:
(a) if he shall resign upon giving notice in writing to the
Council, the Manager and the Unitholder;
(b) if an order shall be made by any court claiming jurisdiction
on the ground of mental disorder for his detention or for the
appointment of a guardian; or
(c) the Board of Directors shall terminate such member with or
without prior notice.
D. Remuneration.
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Members of the Council shall receive fees as set forth in Exhibit
C hereto.
E. Meetings
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13.E.1. Subject to the provisions of this Article 13, the members
of the Council may meet together for the dispatch of business, adjourn, and
otherwise regulate their meetings as they think fit. The Council shall from time
to time appoint a Chairman thereof and, at any meeting at which such Chairman is
not present, appoint a Chairman of the meeting.
13.E.2. The continuing members of the Council may act
notwithstanding any vacancies.
13.E.3. The Council shall meet at such times and such places in
Thailand as the Council may determine; provided, however, that the Council shall
meet at least one time each year.
13.E.4. Upon direction of the Chairman of the Council, the
Manager shall give not less than 15 days' notice of the time and place of a
meeting of the Council to each member and to the Unitholder and such notice
shall specify brief details of the business of such meeting. Any member may
waive notice of any meeting and any such waiver may be retroactive.
F. Quorum
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The quorum necessary for the transaction of the business of the
Council shall be 3 members present in person. If, after 15 minutes, the quorum
shall not be present, the meeting shall stand adjourned to a date being 7 days
later at the same time and place as the original meeting and the members then
present in person at the adjourned meeting shall be a sufficient quorum. Notice
of such adjourned meeting shall be given. A meeting of the Council at which a
quorum is present shall be competent to exercise all powers for the time being
exercisable by the members of the Council.
G. Decisions
---------
13.G.1. Questions arising at any meeting of the Council shall
be determined by a majority of votes. In case of an equality of votes, the
Chairman of the Council (or if the Chairman is not present, the Chairman of the
meeting) shall have a second or casting vote.
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13.G.2. A resolution in writing signed by all the members of
the Council shall be as effective as a resolution duly passed at a meeting of
the Council and may consist of several documents in the like form, each signed
by one or more members.
H. Information
-----------
The Manager shall supply to each member of the Council such
information as may reasonably be requested by the Council concerning the Kingdom
of Thailand's securities markets and details of any proposed investment in
unlisted securities.
I. Conflict of Interests
---------------------
No member of the Council shall, as principal or agent, sell or
deal in the sale of, any asset of the Funds or purchase any asset from the Funds
and each member shall procure that none of his affiliates performs any such act
except as expressly authorized hereunder. Members of the Council shall be
subject to applicable provisions of U.S. Law.
J. Liability
---------
Members of the Council may rely on information reasonably
believed by them to be accurate and reliable. Members of the Council shall not
be subject to any liability for any act or omission, error of judgment or
mistake of law or for any loss suffered by the Funds in the course of, connected
with or arising out of any services to be rendered hereunder except by reason of
willful misfeasance, bad faith or gross negligence in the performance of their
duties or by reason of reckless disregard by them of their obligations and
duties under this Agreement.
14. Information and Notices
-----------------------
A. Documents To Be Made Available; Offices
---------------------------------------
14.A.1. There shall be held available by the Manager for
inspection by any person without charge at the principal office of the Manager
in Bangkok at all reasonable business hours copies of:
(a) this Investment Contract as from time to time amended;
(b) the most current sales prospectus related to shares of the
Unitholder; and
(c) all filings made by the Unitholder with the SEC (including
financial statements) for the two latest fiscal years of the Unitholder
or (if less) for all periods since the establishment of the Unitholder.
14.A.2. The Manager shall at all times maintain an office or
offices in Bangkok and shall notify the Unitholder in the manner prescribed by
Section 14.A.2 above of any change in the address of its principal office in
Bangkok.
B. Notices
-------
Except as otherwise provided herein, all notices or other
communications to the respective parties hereto shall be deemed to have been
duly made when delivered by airmail, telex or
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personal delivery at its address specified below or to such other address as any
of the parties hereto may hereafter specify to the other in writing.
For the Manager:
The Mutual Fund Public Company Limited
30th-32nd Floor
Lake Rajada Building
▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ Thailand
For the Unitholder:
The Thai Fund, Inc.
c/o Morgan ▇▇▇▇▇▇▇ Asset Management Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
15. Amendments
----------
15.1 This Investment Contract shall be capable of amendment only (a)
with the prior agreement of the Unitholder (which, in the case of the Advisory
Sections, shall be obtained in accordance with U.S. Law) and the Manager, and
(b) subject to (X) applicable U.S. Law and (Y) applicable Thai law, including
approval of the BOT.
15.2 Sections 5.3 and 8.4(a), (e) and (f) hereof, in addition to the
requirements of Section 15.1, may not be amended without the consent of
two-thirds of the outstanding voting securities of the Unitholder.
16. Governing Law, Jurisdiction; Language and Miscellaneous
-------------------------------------------------------
16.1 This Investment Contract and Beneficial Certificates shall be
governed by and construed in accordance with the laws of the Kingdom of
Thailand, provided, however, that all U.S. Sections and all matters arising out
of or relating thereto, or as to whether a provision is part of a U.S. Section,
shall be governed by U.S. Law.
16.2 The parties irrevocably agree that any suit, action or proceeding against
the Unitholder arising out of or relating to this Investment Contract shall be
subject exclusively to the jurisdictions of the United States District Court for
the Southern District of New York and the Supreme Court of the State of New
York, New York County, and irrevocably submit to the jurisdiction of each such
Court in connection with any such suit, action or proceeding. The parties waive
any objection to the laying of venue of any such suit, action or proceeding in
either such Court, and waive any claim that such suit, action or proceeding has
been brought in an inconvenient forum. The parties irrevocably consent to
service of process in connection with any such suit, action or proceeding by
prepaid mail at their respective addresses as set forth in this Investment
Contract.
16.3 The parties further agree that any suit, action or proceeding
against the Manager arising out of or relating to this Investment Contract may,
at the sole and unreviewable option of the Unitholder, be commenced in the
jurisdictions either (i) of the courts of the Kingdom of Thailand or (ii) of the
United States District Court for the Southern District of New York (the
"District Court") or the Supreme Court of
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the State of New York, New York County (the "Supreme Court"). In the event the
Unitholder exercises its option to commence a suit, action or proceeding in
either the District Court or the Supreme Court, the Manager irrevocably submits
to the jurisdiction of each such court in connection with any such suit, action
or proceeding, and the Manager further agrees that, in the event the District
Court, for whatever reason, declines to exercise or is determined not to have
jurisdiction in connection with any such suit, action or proceeding, the
Unitholder may commence a subsequent such suit, action or proceeding in the
Supreme Court, and the Manager irrevocably submits to the jurisdiction of the
Supreme Court in connection with any such subsequent suit, action or proceeding.
The Manager waives any objection to the laying of venue of any such suit, action
or proceeding in the District Court or the Supreme Court, and waives any claim
that such suit, action or proceeding has been brought in an inconvenient forum.
The Manager irrevocably consents to service of process in connection with any
such suit, action or proceeding by prepaid mail at its address as set forth in
this Investment Contract.
16.4 To the extent that the Manager or the Unitholder may now or
hereafter be entitled, in any jurisdiction in which judicial proceedings may at
any time be commenced with respect to this Investment Contract, to claim for
itself or its revenues or properties any immunity from suit, court jurisdiction,
attachment prior to judgment, attachment in aid of execution of a judgment,
execution of a judgment or from set-off, banker's lien, counterclaim or any
other legal process or remedy with respect to its obligations under this
Investment Contract and/or to the extent that in such jurisdiction there may be
attributed to the Manager or the Unitholder such an immunity (whether or not
claimed), the Manager and the Custodian each hereby to the fullest extent
permitted by applicable law irrevocably agrees not to claim, and hereby to the
fullest extent permitted by applicable law expressly waives, any such immunity,
including, without limitation, a complete waiver of immunity pursuant to the
United States Foreign Sovereign Immunities Act.
16.5 The governing language of this Investment Contract shall be
English.
16.6 The headings contained in this Investment Contract are for
reference only and shall not be deemed to limit or affect any of the provisions
hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers or representatives thereunto duly
authorized, all as of the date first above written.
THE MUTUAL FUND PUBLIC COMPANY LIMITED
By: /s/ Damrongsuk Amatyakul
--------------------------------------------
Name: DAMRONGSUK AMATYAKUL
Title: PRESIDENT
THE THAI FUND, INC.
By: /s ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Secretary
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EXHIBIT A
TECHNICAL ASSISTANCE AND SECONDING AGREEMENT
THIS AGREEMENT ("Agreement") is dated as of June 1, 1997 by and among
THE MUTUAL FUND PUBLIC COMPANY LIMITED (the "Thai Manager"), a Thai limited
company, with its principal office located at 30th-32nd Floor, Lake Rajada
Building, ▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇-▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇; ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ASSET MANAGEMENT INC. (the "U.S. Manager"), a Delaware corporation, with
its principal office located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇; and THE THAI FUND, INC. (the "Company"), a Maryland corporation, with its
principal office located at c/o Morgan ▇▇▇▇▇▇▇ Asset Management Inc., ▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Thai Manager has entered into an Investment Contract (as
defined below) for the establishment of a Thai investment fund (the "Thai
Fund"), whereunder the Thai Manager has assumed the management of the said fund
on the terms and conditions specified in the said Investment Contract; and
WHEREAS, the U.S. Manager has experience and expertise in the
management of assets, securities trading and investment research; and
WHEREAS, the parties hereto desire to provide for management of the
acquisition and disposition of securities by the Thai Fund, on the terms and
conditions hereinafter set forth; and
WHEREAS, the U.S. Manager and the Company desire that the U.S. Manager
render investment management services to the Company, on the terms and
conditions hereinafter set forth.
NOW THEREFORE, the parties hereto agree as follows:
1. Definitions
1.1 "Board of Directors" means the Board of' Directors of the
Company.
1.2 "Council" shall have the meaning ascribed thereto in the
Investment Contract.
1.3 "District Court" shall have the meaning ascribed thereto in
Section 7.2.
1.4 "Effective Date" means the date on which the Registration
Statement first is declared effective by the SEC under the United States
Securities Act of 1933, as amended.
1.5 The "Funds" means the Company and the Thai Fund, jointly and
severally, as if such entities were one entity.
1.6 "Investment Company Act" means the U.S. Investment Company Act
of 1940, as amended.
1.7 "Investment Contract" means the agreement dated as of the date
first written above between the Company and the Thai Manager.
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1.8 "Registration Statement" means the Company's Registration
Statement on Form N-2 filed with the SEC.
1.9 "SEC" means the U.S. Securities and Exchange Commission.
1.10 "Seconded Staff" shall have the meaning ascribed thereto in
Section 2.1 hereof.
1.11 "Supreme Court" shall have the meaning ascribed thereto in
Section 7.2.
1.12 "Thai Custodian" means The Thai Farmers Bank or its successors
or permitted assigns.
1.13 "Thai Employees" shall have the meaning ascribed thereto in
Section 3.2.
1.14 The "Thai Fund" shall have the meaning ascribed thereto above.
1.15 "Underwriting Agreement" means the Underwriting Agreement in
respect of the Company's shares of common stock ($0.01 par value) executed on or
about the date hereof.
1.16 "U.S. Assets" shall have the meaning ascribed thereto in
Section 2.2 hereof.
2. Services to be rendered by the U.S. Manager
2.1 (a) The U.S. Manager shall (X) make available to the Thai Manager
seconded staff ("Seconded Staff"), such Seconded Staff to provide to the Thai
Manager advice with respect to all investment decisions for the Thai Fund and
all acquisitions and dispositions of securities by the Thai Fund, and (Y)
prepare and make available to the Thai Fund research and statistical data in
connection therewith, all in accordance with the Company's investment objectives
and policies and in accordance with supervision and instructions of the Board of
Directors.
(b) For purposes of this Agreement, "instructions from the Board of
Directors" shall include the right to request a power of attorney from the Thai
Manager in order to enforce claims of, or to defend claims against, the Fund.
2.2 The U.S. Manager shall make investment decisions for the Company
with respect to any assets other than those held through the Thai Fund (the
"U.S. Assets"), prepare and make available to the Company research and
statistical data in connection therewith, supervise the acquisition and
disposition of the U.S. Assets and select and place orders with brokers and
dealers for execution of transactions for U.S. Assets, all in accordance with
the Company's investment objectives and policies and in accordance with
guidelines and directions from the Board of Directors.
2.3 The U.S. Manager shall (i) assist the Funds as they may reasonably
request in the conduct of the Funds' business, subject to the direction and
control of the Board of Directors; (ii) maintain or cause to be maintained for
the Funds all books and records required under the Investment Company Act to the
extent that such books and records are not maintained or furnished by the Funds,
custodians or other agents of the Funds; (iii) furnish at the U.S. Manager's
expense for the use of the Funds such office space and facilities as the Funds
may require for their reasonable needs in the City of New York, and to furnish
at the U.S. Manager's expense clerical services in the United States related to
research, statistical and investment work; and (iv) pay the reasonable salaries,
fees and expenses of such of the Funds' officers and employees (including the
Funds' share of U.S. payroll taxes) and any fees and expenses of such of the
Funds' directors as are directors, officers or employees of the U.S. Manager;
provided, however, that the Funds, and not the U.S. Manager, shall pay the fees
of members of the Council and
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shall bear travel expenses of directors and officers of the Funds who are
managing directors, officers or employees of the U.S. Manager to the extent that
such expenses relate to attendance at meetings of the Board of Directors or any
committees thereof.
2.4 The U.S. Manager shall bear all expenses arising out of its duties
hereunder but shall not be responsible for any expenses of the Funds other than
those specifically allocated to the U.S. Manager in paragraphs 2.1, 2.2, 2.3,
2.4 and 2.5. In particular, but without limiting the generality of the
foregoing, the U.S. Manager shall not be responsible, except to the extent of
the compensation of such of the Funds' employees as are managing directors,
officers or employees of the U.S. Manager whose services may be involved, for
the following expenses with respect to the Funds: organization expenses of the
Funds (including out-of-pocket expenses); fees, dues and expenses, incurred by
the Funds in connection with membership in investment company organizations;
fees and expenses of the Funds' administrators, custodians, transfer agents and
registrars; payment for portfolio pricing services to a pricing agent, if any;
expenses of preparing share and other certificates of the Funds, and other
expenses, including but not limited to stamp duties, in connection with the
issuance, offering, distribution, sale or underwriting of securities issued by
the Company or the Thai Fund; expenses of registering or qualifying securities
of the Company for sale; expenses relating to investor and public relations;
freight, insurance and other charges in connection with the shipment of the
Funds' portfolio securities; brokerage commissions, stamp duties or other costs
of acquiring or disposing of any portfolio securities of the Funds; expenses of
maintaining a register of holders of interests in the Thai Fund; expenses of
preparing and distributing reports and notices to the Company, the Company's
Board of Directors, the Council, the Company's administrators, the U.S. Manager,
the Thai Manager and the Company's stockholders, and expenses of communications
among such persons (other than by the Company's stockholders); expenses of
dividends and distributions to the Company and the Company's stockholders; costs
of stationery; expenses incurred in preparing and publishing notices; costs of
stockholders' and other meetings; litigation expenses; legal fees and expenses
of counsel (United States and Thailand) to the Funds and if such counsel are
retained by the Company's directors who are not "interested persons" of the Thai
Fund or the Company, of such counsel; fees and expenses of independent
accountants of the Funds; or expenses relating to the Company's dividend
reinvestment and cash purchase plan.
2.5 In connection with the rendering of services required under
paragraphs 2.1, 2.2, 2.3 and 2.4 above, Section 3.1 hereof provides that the
Thai Manager shall furnish certain services to the U.S. Manager, and the U.S.
Manager may contract with or consult with such banks, other securities firms or
other parties in Thailand or elsewhere as it may deem appropriate to obtain
information and advice, including investment recommendations, advice regarding
economic factors and trends, advice as to currency exchange matters, and
clerical and accounting services and other assistance, but any fee, compensation
or expenses to be paid to any such parties shall be paid by the U.S. Manager,
and no obligation shall be incurred on the Funds' behalf in any such respect
(except as to the Thai Manager for which the Funds shall pay the fees described
in Section 3.3 of the Investment Contract).
2.6 The Funds agree to pay in United States dollars to the U.S.
Manager, as full compensation for the services rendered and expenses borne by
the U.S. Manager hereunder, a monthly fee, payable, except as provided below,
within three New York business days of the first day of each month following the
day on which such payment is computed, equal to 1/12 of 0.90% of the value of
the average weekly net assets of the Funds up to and including $50 million, plus
1/12 of 0.70% of the value of the next $50 million of the average weekly net
assets of the Funds, plus 1/12 of 0.50% of the value of the average weekly net
assets of the Funds over $100 million. The weekly net assets of the Funds for a
month shall be determined as of the close of business in New York on the last
New York Stock Exchange business day of each week where such business day falls
within one month, and be averaged by dividing the total of such weekly net
assets by such numbers of weeks in such month. Such fee shall be computed
beginning on the "Closing Date" (as defined in the Underwriting Agreement) until
the termination of this
A-3
Agreement for whatever reason. The fee from the Closing Date to the end of the
month during which the Closing Date occurs shall be prorated according to the
proportion which such period bears to the full monthly period. Upon termination
of this Agreement before the end of any month, such fee for such part of a month
shall be prorated according to the proportion which such period bears to the
full monthly period and shall be payable on the date of termination of this
Agreement. The fees payable from the Funds to the U.S. Manager hereunder shall
be paid from the Thai Fund and/or the U.S. Assets as determined by the Board of
Directors. All such fees paid from the Thai Fund shall be paid subject to
applicable Thai withholding tax. For the purposes of this Agreement, the net
assets of the Funds shall be computed pursuant to the directions of the Board of
Directors.
2.7 Nothing herein shall be construed as prohibiting the U.S. Manager
from providing investment advisory services to, or entering into investment
advisory agreements with, other clients (including other registered investment
companies), including clients which may invest in securities of Thai issuers, or
from utilizing (in providing such services) information furnished to the U.S.
Manager by the Thai Manager or others.
2.8 The U.S. Manager may rely on information reasonably believed by it
to be accurate and reliable. Neither the U.S. Manager nor its officers,
directors, employees, agents or controlling persons as defined in the Investment
Company Act shall be subject to any liability for any act or omission, error of
judgment or mistake of law, or for any loss suffered by the Funds, in the course
of, connected with or arising out of any services to be rendered hereunder,
except by reason of willful misfeasance, bad faith or gross negligence on the
part of the U.S. Manager in the performance of its duties or by reason of
reckless disregard on the part of the U.S. Manager of its obligations and duties
under this Agreement. Any person, even though also employed by the U.S. Manager,
whether or not as part of the Seconded Staff, who may be or may become an
employee of the Funds and paid by the Funds shall be deemed, when acting within
the scope of his employment by the Funds, to be acting in such employment solely
for the Funds and not as an employee or agent of the U.S. Manager.
3. Services to be rendered by the Thai Manager
-------------------------------------------
3.1 The Thai Manager shall (i) furnish to the U.S. Manager or its
designee (a) a daily bulletin concerning Thai stock market developments, (b) a
weekly bulletin concerning securities and other assets owned by the Thai Fund,
(c) a weekly and month-end list of securities values of all Thai assets of the
Thai Fund, and (d) bulletins, from time to time requested by the U.S. Manager,
concerning Thai economic developments, industries and securities; (ii) furnish
to the U.S. Manager such additional information, investment recommendations,
advice and assistance, as the U.S. Manager shall from time to time reasonably
request in order that the U.S. Manager may provide the services undertaken by it
pursuant to Article 2 hereof; (iii) act in accordance with the advice of the
Seconded Staff in connection with all investment decisions for the Thai Fund and
all determinations as to acquisition and disposition of securities held by the
Thai Fund and with the selection and placing of orders with brokers and dealers
for execution for the Thai Fund; and (iv) exercise all rights associated with
such legal ownership of the assets of the Thai Fund, subject to the Company's
investment objectives and policies and guidelines and directions of the Board of
Directors as set forth in Section 3.A.1 of the Investment Contract.
3.2 The Thai Manager undertakes and agrees (i) to assist the Funds as
they may reasonably request in the conduct of the Funds' business subject to the
direction and control of the Board of Directors; (ii) to maintain or cause to be
maintained for the Funds all books and records required under Thai law and
regulations to the extent that such books and records are not maintained or
furnished by the Thai Custodian or other agents of the Funds; (iii) to furnish
at the Thai Manager's expense for the use of the Funds such office space and
facilities as the Funds may require for their reasonable needs in Thailand and
to furnish at the Thai Manager's expense clerical services in Thailand related
to research, statistical
A-4
and investment work for the benefit of the Funds; and (iv) to pay the reasonable
salaries, fees and expenses of such of the Funds' officers and employees
(including the Funds' share of Thai payroll taxes) and any fees and expenses of
such of the Funds' directors as are directors, officers or employees of the Thai
Manager; provided, however, that the Funds, and not the Thai Manager, shall pay
the fees of members of the Council and shall bear travel expenses of directors
and officers of the Funds who are managing directors, officers or employees of
the Thai Manager ("Thai Employees") to the extent that such expenses relate to
attendance at meetings of the Board of Directors or any committees thereof.
3.3 The Thai Manager shall bear all expenses arising out of its duties
hereunder but shall not be responsible for any expenses of the Funds other than
those specifically allocated to the Thai Manager in paragraphs 3.1, 3.2, 3.3 and
3.4. In particular, but without limiting the generality of the foregoing, the
Thai Manager shall not be responsible, except to the extent of the compensation
of such of the Funds' employees as are Thai Employees whose services may be
involved, for the following expenses with respect to the Funds: organization
expenses of the Funds (including out-of-pocket expenses); fees, dues and
expenses incurred by the Funds in connection with membership in investment
company organizations; fees and expenses of the Funds' administrators,
custodians, transfer agents and registrars; payment for portfolio pricing
services to a pricing agent, if any; expenses of preparing share and other
certificates of the Funds, and other expenses, including but not limited to
stamp duties in connection with the issuance, offering, distribution, sale or
underwriting of securities issued by the Company or the Thai Fund; expenses of
registering or qualifying securities of the Company for sale; expenses relating
to investor and public relations; freight, insurance and other charges in
connection with the shipment of the Funds' portfolio securities; brokerage
commissions, stamp duties or other costs of acquiring or disposing of any
portfolio securities of the Funds; expenses of maintaining a register of holders
of interests in the Thai Fund; expenses of preparing and distributing reports
and notices to the Company, the Company's Board of Directors, the Council, the
Company's administrators, the U.S. Manager, the Thai Manager and the Company's
stockholders, and expenses of communications among such persons (other than by
the Company's stockholders); expenses of dividends and distributions to the
Company and the Company's stockholders; costs of stationery; expenses incurred
in preparing and publishing notices; costs of stockholders' and other meetings;
litigation expenses; legal fees and expenses of counsel (United States and
Thailand) to the Funds and, if such counsel are retained by the Company's
directors who are not "interested persons" of the Thai Fund or the Company, of
such counsel; fees and expenses of independent accountants of the Funds; or
expenses relating to the Company's dividend reinvestment and cash purchase plan.
3.4 The U.S. Manager agrees to work with the Thai Manager, in order to
make their relationship as productive as possible for the benefit of the Funds,
and to further the development of the Thai Manager's ability to provide the
services contemplated by paragraphs 3.1, 3.2, 3.3 and 3.4 hereof. To this end
the U.S. Manager agrees to work closely with the Thai Manager's employees and to
work with the Thai Manager to assist it in developing its research techniques,
procedures and analysis. The U.S. Manager agrees not to furnish, without the
Thai Manager's consent, to any person other than the U.S. Manager's personnel
and directors and representatives of the Funds any tangible research material
that is prepared by the Thai Manager, that is not publicly available, and that
has been stamped or otherwise clearly indicated by the Thai Manager as being
confidential.
3.5 Nothing herein shall be construed as prohibiting the Thai Manager
from providing investment advisory services to, or entering into investment
advisory agreements with, other clients including other investment companies.
3.6 Neither the Thai Manager nor any affiliate of the Thai Manager
shall receive any compensation in connection with the placement or execution of
any transaction for the purchase or sale of securities or for the investment of
funds on behalf of the Funds, except that the Thai Manager or the Thai
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Manager's affiliates may receive a commission, fee or other remuneration for
acting as broker in connection with the sale of securities to or by the Funds,
if permitted under the Investment Company Act, as amended.
3.7 The Thai Manager may rely on information reasonably believed by the
Thai Manager to be accurate and reliable. Neither the Thai Manager, the Thai
Manager's officers, directors, employees, agents nor any controlling persons as
defined in the Investment Company Act shall be subject to any liability for any
act or omission, error of judgment or mistake of law or for any loss suffered by
the Funds in the course of, connected with or arising out of any services to be
rendered hereunder except by reason of willful misfeasance, bad faith or gross
negligence in the performance of the Thai Manager's duties or by reason of
reckless disregard by the Thai Manager of the Thai Manager's obligations and
duties under this Agreement. Any person even though also employed by the Thai
Manager, whether or not as part of the Seconded Staff, who may be or become an
employee of the Funds and paid by the Funds shall be deemed, when acting within
the scope of his employment by the Funds, to be acting in such employment solely
for the Funds, and not as employee or agent of the Thai Manager.
4. Effective Date and Termination
------------------------------
4.1 This Agreement shall become effective on the date hereof; shall
remain in effect for a period of two years from the date hereof and shall
continue in effect thereafter, but only so long as such continuance is
specifically approved at least annually by the affirmative vote of (i) a
majority of the members of the Board of Directors who are not parties to this
Agreement or interested persons of the Funds, the Thai Manager or the U.S.
Manager, cast in person at a meeting called for the purpose of voting on such
approval, and (ii) a majority of the Board of Directors or the holders of a
majority of the outstanding voting securities of the Company. This Agreement may
nevertheless be terminated at any time, without any penalty, by the Company's
Board of Directors or by vote of holders of a majority of the outstanding voting
securities of the Company, or by the U.S. Manager, upon 60 days' written notice
delivered or sent by registered mail, postage prepaid, to the other parties
hereto, at their respective addresses given above or at any other address of
which any shall have notified the others in writing, and shall automatically be
terminated in the event of its assignment (as defined in the Investment Company
Act) or termination of the Advisory Sections of the Investment Contract as set
forth in Section 8.2 thereof or other termination pursuant to Section 8.4
thereof. Any notice shall be deemed given when received by the addressee.
4.2 This Agreement may not be transferred, assigned, sold or in any
manner hypothecated or pledged by either party hereto other than as permitted
pursuant to Section 4.1 hereof. It may be amended by mutual agreement, but only
after authorization of such amendment (a) by the affirmative vote of (i) the
holders of a majority of the outstanding voting securities of the Company; and
(ii) a majority of the members of the Board of Directors who are not interested
persons of the Funds, the Thai Manager or the U.S Manager, cast in person at a
meeting called for the purpose of voting on such approval; and (b) in accordance
with applicable Thai law.
5. Governing Law
-------------
This Agreement and the rights and obligations of the parties hereunder
shall be construed in accordance with and governed by the laws of the United
States and New York law.
6. Notices
-------
Except as otherwise provided herein, all notices or other
communications to the respective parties hereto shall be deemed to have been
duly made when delivered by airmail, telex or personal delivery at its
A-6
address specified below or to such other address as any of the parties hereto
may hereafter specify to the other in writing.
For the Thai Manager:
The Mutual Fund Public Company Limited
30th-32nd Floor
Lake Rajada Building
193-195 Ratchadaphisek Road
Khlong-Toey
New Petchburi Road
Bangkok, Thailand
For the U.S. Manager:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Asset Management Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
For the Company:
The Thai Fund, Inc.
c/o Morgan ▇▇▇▇▇▇▇ Asset Management Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
7. Jurisdiction
------------
7.1 The parties irrevocably agree that any suit, action or proceeding
against the Company or the U.S. Manager arising out of or relating to this
Agreement shall be subject exclusively to the jurisdictions of the United States
District Court for the Southern District of New York and the Supreme Court of
the State of New York, New York County, and irrevocably submit to the
jurisdiction of each such Court in connection with any such suit, action or
proceeding. The parties waive any objection to the laying of venue of any such
suit, action or proceeding in either such Court, and waive any claim that such
suit, action or proceeding has been brought in an inconvenient forum. The
parties irrevocably consent to service of process in connection with any such
suit, action or proceeding by prepaid mail at their respective addresses as set
forth in this Agreement.
7.2 The parties further agree that any suit, action or proceeding
against the Thai Manager arising out of or relating to this Agreement may, at
the sole and unreviewable option of the Company (or the U.S. Manager, if the
Company is not a party), be commenced in the jurisdictions either (i) of the
courts of the Kingdom of Thailand or (ii) of the United States District Court
for the Southern District of New York (the "District Court") or the Supreme
Court of the State of New York, New York County (the "Supreme Court"). In the
event the Company (or the U.S. Manager, if the Company is not a party) exercises
its option to commence a suit, action or proceeding in either the District Court
or the Supreme Court, the Thai Manager irrevocably submits to the jurisdiction
of each such court in connection with any such suit, action or proceeding, and
the Thai Manager further agrees that, in the event the District Court, for
whatever reason, declines to exercise or is determined not to have jurisdiction
in connection with any such suit, action or proceeding, the Company (or the U.S.
Manager, if the Company is not a party) may commence a subsequent such suit,
action or proceeding in the Supreme Court, and the Thai Manager irrevocably
submits to the jurisdiction of the Supreme Court in connection with any such
subsequent suit,
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action or proceeding. The Thai Manager waives any objection to the laying of
venue of any such suit, action or proceeding in the District Court or the
Supreme Court, and waives any claim that such suit, action or proceeding has
been brought in an inconvenient forum. The Thai Manager irrevocably consents to
service of process in connection with any such suit, action or proceeding by
prepaid mail at its address as set forth in this Agreement.
7.3 To the extent that the Thai Manager or the Company may now or
hereafter be entitled, in any jurisdiction in which judicial proceedings may at
any time be commenced with respect to this Agreement, to claim for itself or its
revenues or properties any immunity from suit, court jurisdiction, attachment
prior to judgment, attachment in aid of execution of a judgment, execution of a
judgment or from set-off, banker's lien, counterclaim or any other legal process
or remedy with respect to its obligations under this Agreement and/or to the
extent that in such jurisdiction there may be attributed to the Thai Manager or
the Company such an immunity (whether or not claimed), the Thai Manager and the
Company each hereby to the fullest extent permitted by applicable law
irrevocably agrees not to claim, and hereby to the fullest extent permitted by
applicable law expressly waives, any such immunity, including, without
limitation, a complete waiver of immunity pursuant to the United States Foreign
Sovereign Immunities Act.
8. Language
--------
The governing language of this Agreement shall be English.
9. Headings
--------
The headings contained in this Agreement are for reference only and
shall not be deemed to limit or affect any of the provisions hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers or representatives thereunto duly
authorized, all as of the date first above written.
THE MUTUAL FUND PUBLIC COMPANY LIMITED
By:
--------------------------------------------
Name:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ASSET MANAGEMENT INC.
By:
--------------------------------------------
Name:
Title:
THE THAI FUND, INC.
By:
--------------------------------------------
Name:
Title:
A-9
EXHIBIT B
---------
FORM OF CERTIFICATE
-------------------
BENEFICIAL CERTIFICATE OF
THE THAI FUND PURSUANT TO
INVESTMENT CONTRACT
dated as of June 1, 1997
(the "Investment Contract")
Unitholder: The Thai Fund, Inc., a Maryland Corporation.
Issue Date of Units:
Issue Date of Certificate:
Total Number of Units represented hereby:
Per Unit Value:
Time and Place of Payment: As described in the Investment Contract.
Remuneration and other fees: As described in the Investment Contract.
Redemption: Only as specifically permitted in the Investment Contract.
Calculation of Net Asset Value: As described in the Investment Contract.
Duration of the Fund: As described in the Investment Contract.
Notices: As described in the Investment Contract.
Pursuant to the Investment Contract which establishes a fund, The Mutual Fund
Public Company Limited, as Thai Manager, issues this Beneficial Certificate
subject to all of the terms of the Investment Contract.
THE MUTUAL FUND PUBLIC COMPANY LIMITED
By:
------------------------------------------------
Name:
Title:
Seal of The Mutual Fund Public Company Limited: [SEAL]
This Certificate and the interests represented hereby are non-transferable and
may not be held by persons other than The Thai Fund, Inc. This Certificate and
the interest represented hereby are in all respects governed by, and subject to,
the Investment Contract.
B-1
EXHIBIT C
FORM OF COUNCIL AGREEMENT
______________,1997
[Name and Address of Member]
Dear __________________,
We refer to our earlier discussion regarding your proposed appointment
to the Council pursuant to The Thai Fund, Inc. Investment Contract (the
"Investment Contract"). We are now formally inviting you to become a member of
the Council upon the terms and conditions of the Investment Contract, a copy of
which is enclosed for your information.
You will note from Section 13.A.2 of the Investment Contract that the
principal functions of the Council include the following:
(a) consult with The Mutual Fund Public Company Limited on Thailand
economic and securities market matters; and
(b) exercise such other powers and rights as are provided under the
Investment Contract.
Each member's liabilities are limited pursuant to the Investment
Contract as described in Section 13.J thereof. Each member of the Council who
does not receive fees in connection with membership in the Fund's Board of
Directors will be paid an annual fee of $5,000 plus $500 for each meeting of the
Council attended in person.
Formal meetings of the Council will be held at least one time a year in
Thailand.
If you would like to accept our offer to become a member of the
Council, please sign and return the duplicate of this letter by way of
agreement.
Yours faithfully,
------------------------------------------------
The Mutual Fund Public Company Limited
The undersigned hereby confirm your offer to become a member of the Council,
upon the terms and conditions of the Investment Contract enclosed with your
letter.
Sincerely,
------------------------------------------------