SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
Clemente Global Growth Fund, Inc.
- -------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- ------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction
applies:
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2) Aggregate number of securities to which transaction
applies:
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3) Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule 0-11
(Set forth the amount on which the filing fee is
calculated and state how it was determined):
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the Form or Schedule and the
date of its filing.
1) Amount Previously Paid:
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4) Date Filed:
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<PAGE>
CLEMENTE GLOBAL GROWTH FUND, INC.
152 West 57th Street
New York, New York 10019
__________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 29, 1997
__________________________
The Annual Meeting of Stockholders of Clemente Global Growth
Fund, Inc. (the "Fund"), a Maryland corporation, will be held at
Le Parker Meridian, 119 West 56th Street, New York, New York, on May 29,
1997 at 9:00 a.m., New York time, for the following purposes:
1. A proposal to approve a U.S. Advisory Agreement among
the Fund, Clemente Capital, Inc. and Wilmington Trust
Company pursuant to which Wilmington Trust Company will
manage the U.S. portion of the Fund's portfolio, which
proposal the Board of Directors favors;
2. To elect Robert J. Christian as a Class II director for
a term of two years (expiring in 1999) and until his
successor is duly elected and qualified;
3. To elect Thomas H. Lenagh, Sam Nakagama and G. Peter
Schieferdecker as Class III directors for terms of three
years (expiring in 2000) and until their successors are
duly elected and qualified;
4. To ratify the selection by the Board of Directors of
Price Waterhouse LLP as the Fund's independent
accountants for the year ending December 31, 1997;
5. To approve or disapprove a shareholder proposal to
request the Board of Directors to seriously consider
soliciting competitive proposals for a new investment
adviser for the Fund, which proposal the Board of
Directors opposes; and
6. To transact such other business as may properly come
before the meeting or any adjournment thereof.
The Board of Directors has fixed March 10, 1997 as the record
date for the meeting. Only holders of record of the Fund's Common
Stock at the close of business on such date will be entitled to
notice of, and to vote at, such meeting. The stock transfer books
will not be closed.
<PAGE>
A copy of the Fund's Annual Report for the fiscal year ended
December 31, 1996 has been previously mailed to stockholders.
Dated: April 30, 1997 By order of the
Board of Directors,
William H. Bohnett
Secretary
IMPORTANT
Unless you expect to be present at the meeting, please fill
in, date, sign and mail the enclosed proxy card in the enclosed
reply envelope. Your prompt response will assure a quorum at the
meeting. <PAGE>
CLEMENTE GLOBAL GROWTH FUND, INC.
152 West 57th Street
New York, New York 10019
PROXY STATEMENT
for
ANNUAL MEETING OF STOCKHOLDERS
to be held May 29, 1997
__________________________
GENERAL INFORMATION
The Board of Directors of the Fund solicits the proxies of
the holders of the Fund's Common Stock for use at the Annual
Meeting of Stockholders (the "Meeting") to be held at Le Parker Meridian
119 West 56th Street, New York, New York 10019, on May 29, 1997, at
9:00 a.m., New York time, and at any and all adjournments thereof.
A form of proxy is enclosed herewith. The Proxy Statement and the
form of proxy were first sent to stockholders on April 30, 1997.
Any stockholder who executes and delivers a proxy may revoke it by
written communication at any time prior to its use or by voting in
person at the Annual Meeting. The cost of soliciting the proxies
will be borne by the Fund.
Directors, officers and regular employees of the Fund may solicit
proxies by telephone, facsimile or personal interview. In
addition, the Fund has engaged the services of Georgeson & Company
Inc., a professional proxy solicitation firm, to solicit proxies
from its stockholders. The contract between the parties provides
for solicitation services at an estimated cost of $20,000, plus
expenses. The Fund will, upon request, bear the reasonable
expenses of brokers, banks and their nominees who are holders of
record of the Fund's shares of Common Stock on the record date,
incurred in mailing copies of the Annual Report, this Notice of
Meeting and Proxy Statement and the enclosed form of proxy to the
beneficial owners of the Fund's shares of Common Stock.
Only holders of issued and outstanding shares of the Fund's
Common Stock of record at the close of business on March 10, 1997
are entitled to notice of, and to vote at, the meeting. Each such
holder is entitled to one vote per share of Common Stock so held.
The number of shares of Common Stock outstanding on March 10, 1997
was 5,892,400.
Copies of the Fund's annual report are available free of
charge to any stockholder. Reports may be ordered by writing
Clemente Capital, Inc., 152 West 57th Street, New York, New York
10019 or calling (800) 937-5449.
<PAGE>
PROPOSAL NO. 1
APPROVAL OF A NEW U.S. ADVISORY AGREEMENT
Reasons for the Proposal. Clemente Capital, Inc. ("Clemente
Capital" or the "Adviser") has served as the Fund's investment
adviser since the Fund's inception in 1987 under an investment
advisory agreement dated June 19, 1987 (the "Fund Advisory
Agreement"). Such agreement was approved by the Fund's
stockholders on June 19, 1987 and April 27, 1988 and annually by
the Fund's Board of Directors, most recently on April 24, 1996.
From its inception, the Fund has characterized itself as a "global"
fund, which invests in securities of issuers around the world and
in the United States, and not an "international" fund which seeks
investments only in non-U.S. markets. The distinction is a
critical one since, if a fund seeks to maintain a portfolio loosely
based on the relative capitalizations of the world's equity
markets, the U.S. equity market weighs heavily in such a portfolio
- -- approximately 30% to 40% historically and approximately 45% at
the end of 1996. At the time of the Fund's inception, the Board
believed Clemente Capital brought a strong global performance
record to the Fund.
More recently, however, while Clemente Capital's performance
in international markets has generated competitive returns for the
Fund, the Fund's portfolio has generally been underweighted in U.S.
securities relative to the Fund's benchmark index. Consequently,
in a period of strongly rising U.S. equity prices, the Fund has
underperformed in the last three years.
In the last year, the Board and the Adviser have explored
various alternatives to address this underperformance while
preserving the benefits of Clemente Capital's expertise and its
contract with the Fund. In this regard, the Board has noted that
the Fund Advisory Agreement is highly favorable to stockholders on
a cost of advisory services basis, in that the Adviser's
compensation is tied to the Fund's performance versus that of the
FT-Actuaries World Index, its benchmark, on a rolling three-year
basis. The Board believes that the advisory fees paid by the Fund
have ranked among the lowest in the relevant statistical peer
group, according to Lipper Analytical Services, Inc. While
improving the Fund's recent performance has been the Board's
paramount concern, the Board continues to believe that Clemente
Capital has the expertise and demonstrated capacity in global
markets that are crucial to achievement of the Fund's investment
objective of long-term capital appreciation through investing in
global growth stocks.
During 1996, Wilmington Trust Company ("Wilmington Trust")
purchased a 24.9% stake in Clemente Capital and an affiliate of
Wilmington Trust was subsequently hired as the Fund's
administrator. Wilmington Trust currently has a total of $100
billion in assets under trust custody and investment management and
ranks as the eighth largest personal trust company in the United
States. Wilmington Trust has been in the asset management business
for over 90 years and acts as the investment adviser to the Rodney
Square family of registered funds. Significantly, Wilmington Trust
predominantly focuses on investment in U.S. securities and has
extensive research capabilities in U.S. stocks. After being
approached by Clemente Capital and by the Board of Directors,
Wilmington Trust expressed a willingness to act as the investment
adviser with respect to the U.S. portion of the Fund's portfolio in
return for a portion of the existing advisory fee charged by
Clemente Capital to the Fund under the Fund Advisory Agreement.
At a meeting held April 1, 1997, the Board of Directors,
including a majority of the "disinterested" directors within the
meaning of the Investment Company Act of 1940 (the "1940 Act"),
reviewed and approved the proposed U.S. Advisory Agreement, a copy
of which is attached hereto as Exhibit A, by and among the Fund,
Clemente Capital and Wilmington Trust (the "New Agreement") and
voted to submit the New Agreement to the Fund's stockholders for
their approval. In connection with their consideration, the Board
of Directors considered: (1) the underperformance of the Fund in
recent years; (2) the expertise of Clemente Capital in
international equity markets; (3) the capacity and experience of
Wilmington Trust in the U.S. equity markets; (4) the fact that
investment advisory fees payable by the Fund's stockholders under
the Fund Advisory Agreement would remain unchanged by the New
Agreement and the fact that such fees rank among the lowest in the
Fund's relevant peer group; and (5) the importance of an effective
investment program with respect to U.S. equity markets for a global
fund. The Directors also conducted a review of various documents,
reports and other materials submitted to them by Clemente Capital
and Wilmington Trust and information from independent sources such
as Lipper Analytical Services, Inc.
Terms of the Agreement. The New Agreement provides that,
subject to the supervision of the Board of Directors, Wilmington
Trust will assist Clemente Capital in providing a continuous
investment program for the U.S. portion of the Fund's portfolio
(the "U.S. Portfolio"), including research and selection with
respect to all U.S. securities, investments and cash equivalents.
Securities of any company whose primary trading market is located
in the United States are eligible for inclusion in the U.S.
Portfolio. Pursuant to the New Agreement, Wilmington Trust: (a)
will determine from time to time what securities and other
investments will be purchased, retained or sold for the U.S.
Portfolio; (b) will manage in consultation with the Adviser the
U.S. Portfolio's temporary investments in securities; (c) will
place orders pursuant to its investment determinations for the U.S.
Portfolio, at its option either directly or through the Adviser,
and either directly with the issuer or with any broker or dealer;
(d) will not purchase shares of the Fund for itself or for accounts
with respect to which it exercises sole investment discretion in
connection with such transactions except as permitted by the Fund's
Board of Directors; (e) will consult with the Adviser on a
continuous basis as to the portion of the Fund's total assets which
shall be invested in the U.S. Portfolio; (f) will attend regular
business and investment-related meetings with the Fund's Board of
Directors and the Adviser if requested to do so by the Fund and/or
the Adviser; and (g) will maintain books and records with respect
to the securities transactions for the U.S. Portfolio, furnish to
the Adviser and the Fund's Board of Directors such periodic and
special reports as they may request with respect to the U.S.
Portfolio, and provide in advance to the Adviser all reports to the
Board of Directors for examination and review within a reasonable
time prior to the Fund's Board meetings.
Should the New Agreement be approved, the parties have
expressed to the Board their intention to increase over time the
U.S. portion of the Fund's portfolio (currently 15%) to a range
of between 30% and 40% of the total portfolio subject to
market conditions. Such a range more nearly matches the U.S.
weighting in the FT- Index, the Fund's benchmark as defined below.
The maximum advisory fees payable by the Fund will not change
as a result of approval of the New Agreement. The annual advisory
fee rate payable by the Fund to Clemente Capital under the Fund
Advisory Agreement is comprised of a basic fee of 1% (on an annual
basis) of the month-end net assets of the Fund, that is subject to
adjustment to a maximum of 1.5% (on an annual basis) and a minimum
of .5% (on an annual basis) based upon the performance of the Fund
relative to the FT-Actuaries World Index (the "FT Index") on a
rolling 36-month basis. Under the New Agreement, Wilmington Trust
is entitled to be paid by the Adviser 25% of the fees payable to
the Adviser under the Fund Advisory Agreement. The advisory fees
payable by Clemente Capital to Wilmington Trust under the New
Agreement are the responsibility of Clemente Capital and do not
represent an additional charge to the Fund.
The aggregate investment advisory fees paid under the Fund
Advisory Agreement for the fiscal year ended December 31, 1996 were
$319,763, and the corresponding effective rate of the advisory fees
paid by the Fund during the fiscal year ended December 31, 1996 was
.50% of the Fund's month-end net assets. If the New Agreement had
been in effect during the Fund's fiscal year ended December 31,
1996, Wilmington Trust would have earned $79,440 in fees and
Clemente Capital's compensation would have been reduced to $240,323
(a total of $319,763).
The New Agreement provides that Wilmington Trust will pay all
expenses incurred by it in connection with its activities under the
New Agreement other than the cost of securities, commodities and
other investments (including brokerage commissions and other
transaction charges, if any) purchased for the Fund. The New
Agreement also provides that Wilmington Trust will exercise due
care and diligence and use the same skill and care in providing
services under the New Agreement as it uses in providing services
to other investment companies and accounts it manages, but that
Wilmington Trust shall not be liable for any action taken or
omitted by it in the absence of bad faith, willful misconduct,
gross negligence or reckless disregard of its duties.
Under the New Agreement, Wilmington Trust agrees that either
Clemente Capital or itself, at its option, will place orders for
the purchase and sale of portfolio securities and will solicit
broker-dealers to execute transactions in accordance with the
Fund's policies and restrictions regarding brokerage allocations.
Should Wilmington Trust be responsible for executing portfolio
transactions and selecting brokers or dealers, it will use its
reasonable best efforts to seek the most favorable execution of
orders, after taking into consideration all factors that Wilmington
Trust deems relevant, including 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 the commission, if any, both for the specific
transaction and on a continuing basis. Consistent with their
obligation, Wilmington Trust may, to the extent permitted by law,
purchase and sell portfolio securities to and from brokers and
dealers that provide brokerage and/or research services. These
brokerage and/or research services might consist of reports and
statistics on specific companies or industries, general summaries
of groups of stock or bonds and their comparative earnings and
yields, or broad overviews of the securities markets and the
economy. Commissions paid to brokers or dealers providing these
services may be higher than those which other qualified brokers or
dealers would charge for effecting the same transactions, provided
that Wilmington Trust determines in good faith that such
commissions are reasonable in relation to the value of the
brokerage and/or research services provided by such broker or
dealer, viewed in terms of either a particular transaction or
Wilmington Trust's overall responsibility to the Fund.
Supplementary research information so received is in addition
to, and not in lieu of, services required to be performed by
Clemente Capital and Wilmington Trust, and does not reduce the
advisory fees payable to Clemente Capital by the Fund. It is
possible that certain of the supplementary research or other
services received will primarily benefit one or more other
investment companies or other accounts for which Clemente Capital
or Wilmington Trust exercises investment discretion. Conversely,
the Fund may be the primary beneficiary of the research or services
received as a result of portfolio transactions effected for such
other investment companies or accounts.
Investment decisions for the Fund and for other investment
accounts managed by Wilmington Trust will be made independently of
each other in light of differing conditions. However, the same
investment decision may be made for two or more of such accounts.
In such cases, simultaneous transactions are inevitable. Purchases
or sales are then allocated in a manner believed by Wilmington
Trust to be equitable to each such account. To the extent
permitted by law, Wilmington Trust may aggregate the securities to
be sold or purchased for the Fund with those to be sold or
purchased for other investment companies or accounts in executing
transactions. Fund securities will not be purchased from or sold
to Wilmington Trust or any affiliated person thereof, except as
permitted by law.
If ratified and approved by the stockholders of the Fund, the
New Agreement will continue in effect until May 29, 1999.
Thereafter, the New Agreement will continue in effect with respect
to the Fund for successive annual periods, provided that its
continuance is approved at least annually (a) by the vote of a
majority of those members of the Board of Directors who are not
"interested persons" (as that term is defined by the 1940 Act) of
any party to the New Agreement cast in person at a meeting called
for the purpose of voting on such approval and (b) by the whole
Board of Directors, or by vote of a "majority of the outstanding
shares" of the Fund (as such term is defined by the 1940 Act as set
forth below).
The New Agreement provides that it will terminate
automatically in the event of its "assignment" (as that term is
defined by the 1940 Act). The New Agreement also provides that it
is terminable without penalty by the Fund (by vote of the Board of
Directors of the Fund or by vote of a majority of the outstanding
shares of the Fund) or by Clemente Capital or Wilmington Trust on
60 days' written notice.
The approval of the New Agreement requires the affirmative
vote of the holders of a "majority of the outstanding shares" of
the Fund (as defined by the 1940 Act), which means the lesser of
(i) the holders of 67% or more of the shares of the Fund present at
the Meeting if the holders of more than 50% of the outstanding
shares of the Fund are present in person or by proxy or (ii) more
than 50% of the outstanding shares of the Fund.
THE FUND'S BOARD OF DIRECTORS RECOMMENDS THAT
STOCKHOLDERS VOTE "FOR" THE NEW AGREEMENT
<PAGE>
PROPOSAL NOS. 2 & 3
ELECTION OF DIRECTORS
The Board of Directors is divided into three classes in
accordance with the Fund's Charter and By-Laws. The class of
directors (Class III) whose term will expire at the 1997 Annual
Meeting consists of three present directors: Thomas H. Lenagh, Sam
Nakagama and G. Peter Schieferdecker, who are each nominated for
election for a term of three years and until their successors are
duly elected and qualified.
In addition, Robert J. Christian of Wilmington Trust Company,
the Fund's proposed U.S. Adviser, is nominated as a Class II
director for a term to expire at the 1999 Annual meeting and until
his successor is duly elected and qualified. The Board of
Directors believes that the addition of Mr. Christian, Chief
Investment Officer of Wilmington Trust Company, will be of
significant benefit to the Fund as he brings over 20 years of
investment experience. Mr. Christian is also a director of Rodney
Square Management Corporation, the Fund's administrator, and a
director of The Rodney Square family of mutual funds.
Each of the Class III nominees is currently a director and
has served since the commencement of the Fund's operations. Each
nominee has consented to serve as a director of the Fund if
elected. In the event that any of the nominees should become
unavailable for election for any presently unforeseen reason, the
persons named in the form of proxy will vote for any nominee who
shall be designated by the present Board of Directors. Directors
shall be elected by a plurality of the shares voting at the
Meeting.
The information set forth below as to the ages and principal
occupations of these nominees and the other members of the Board of
Directors, and the number of shares of Common Stock of the Fund
beneficially owned by them, directly or indirectly, has been
furnished to the Fund by such nominees or directors.<PAGE>
<TABLE>
<CAPTION>
NOMINEE WHOSE TERM EXPIRES IN 1999
(Class II)
Name and Address Age Principal Occupation During Past Five Years Number and
Percentage (if
over 1%) of
Shares of
Common Stock
Beneficially
Owned as of
March 10, 1997
</CAPTION>
<S> <C> <C> <C>
*Robert J. Christian 48 Director of the Fund since April 1, 1997; Chief 0
Investment Officer of Wilmington Trust
Company and Chairman and Director of
Rodney Square Management Corp. since
February 1996; Chairman and Director of
PNC Equity Advisors Company and Director,
President and Chief Investment Officer of
PNC Asset Management Group, Inc. from
September 1994 through February 1996;
Director of Provident Capital Management,
Inc. from December 1993 through February
1996; Chief Investment Officer of PNC Bank,
N.A. from October 1992 through February
1996; Director of Investment Strategy of PNC
Bank, N.A. from April 1989 through October
1992; Director of The Rodney Square Fund,
The Rodney Square Tax-Exempt Fund, The
Rodney Square Strategic Income Fund and
The Rodney Square Multi-Manager Fund.
/TABLE
<PAGE>
<TABLE>
<CAPTION>
NOMINEES WHOSE TERMS EXPIRE IN 1997
(Class III)
Name and Address Age Principal Occupation During Past Five Years Number and
Percentage (if
over 1%) of
Shares of
Common Stock
Beneficially
Owned as of
March 10, 1997
</CAPTION>
<S> <C> <C> <C>
*Thomas H. Lenagh
Greenwich Office Park #6
Greenwich, CT 06830 76 Director of the Fund since June 1987; 1000
independent financial adviser since 1984;
Director of CML Group, Inc., Gintel Fund,
Adams Express, Irvine Sensors, Inc.,
ICN Pharmaceuticals, Franklin Quest and V-
Band Corp.
Sam Nakagama
1560 Route 35
Middletown, NJ 07748 71 Director of the Fund since June 1987; 1,000(2)
Chairman and Chief Economist at Nakagama
& Wallace Inc. since February 1983.
G. Peter Schieferdecker
15 Pilot Rock Lane
Riverside, CT 06878 72 Director of the Fund since June 1987; 3,000
Executive Vice President and Treasurer of the
Fund from June 1987 through December
1989; President and Chief Operating Officer
of Clemente Capital, Inc. from March 1986
through December 1988.
/TABLE
<PAGE>
<TABLE>
<CAPTION>
DIRECTORS WHOSE TERMS EXPIRE IN 1998
(Class I)
Name and Address Age Principal Occupation During Past Five Years Number and
Percentage (if
over 1%) of
Shares of
Common Stock
Beneficially
Owned as of
March 10, 1997
</CAPTION>
<S> <C> <C> <C>
*Lilia C. Clemente
152 West 57th Street
New York, NY 10019 56 Chairman and Director of the Fund since June 1,000(1)
1987; Chairman and Chief Executive Officer of
Clemente Capital, Inc. since 1986; Director of
The First Philippine Fund Inc. and Philippine
Strategic Investment (Holdings) Limited.
Robert B. Oxnam
630 Fifth Avenue
New York, NY 10111 54 Director of the Fund since June 1987; Senior 500
Advisor, Bessemer Securities Corporation since
November 1992; President, The Asia Society
Inc., a non-profit, non-political educational
institution, from 1981 through 1992; Director
of The First Philippine Fund Inc.
Baron J.G.A. Sirtema
van Grovestins
Middenduinendaalseweg 25
2061 AP Bloemendaal
The Netherlands 71 Director of the Fund since June 1987; Retired 500
since September 1988; Chief General Manager
of Algemene Bank Nederland N.V. from 1975
to September 1988.
/TABLE
<PAGE>
<TABLE>
<CAPTION>
DIRECTORS WHOSE TERMS EXPIRE IN 1999
(Class II)
Name and Address Age Principal Occupation During Past Five Years Number and
Percentage (if
over 1%) of
Shares of
Common Stock
Beneficially
Owned as of
March 10, 1997
</CAPTION>
<S> <C> <C> <C>
Adrian C. Cassidy
71 Selby Lane
Atherton, CA 94027 81 Director of the Fund since June 1987; 1,000
Marketing Consultant to Discount Corporation
of New York Advisers from April 1985 through
1989; Director of Datron Systems, Inc. and The
First Philippine Fund Inc.
*Leopoldo M. Clemente, Jr.
152 West 57th Street
New York, NY 10019 58 President and Director of the Fund since June 1,000(1)
1987; President and Chief Investment Officer
of Clemente Capital, Inc. since January 1989;
Director of The First Philippine Fund Inc. and
Philippine Strategic Investment (Holdings)
Limited.
All Directors and Officers
as a Group (11 persons) 9,000
</TABLE>
_________________________
(1) Lilia C. Clemente and Leopoldo M. Clemente, Jr. are husband
and wife.
(2) Mr. Nakagama holds his shares jointly with his wife.
* "Interested Person" of the Fund, as defined in the Investment
Company Act of 1940, as amended, by reason of such person's
positions with the Fund, the Adviser or the proposed U.S.
Adviser.
<PAGE>
In addition to Mr. and Mrs. Clemente, William H. Bohnett
and Thomas J. Prapas serve as executive officers of the Fund, as set
forth below. Each of the executive officers serves at the pleasure
of the Board of Directors.
Name and Address Age Principal Occupation During
Past Five Years
William H. Bohnett
666 Fifth Avenue
New York, NY 10103 48 Secretary of the Fund since June
1987; Partner of the law firm of
Fulbright & Jaworski L.L.P. since
February 1991.
Thomas J. Prapas
152 West 57th Street
New York, NY 10019 58 Treasurer of the Fund since January
1990; Economist and Managing
Director at Clemente Capital, Inc.
since June 1986.
The Board of Directors of the Fund held four regular meetings
during 1996. All directors attended at least 75% of such meetings.
The Audit Committee, presently consisting of Messrs.
Schieferdecker, Nakagama and Oxnam, met once during 1996. The
purpose of the Audit Committee is to advise the full Board with
respect to accounting, auditing and financial matters affecting the
Fund.
Directors who are not affiliated with Clemente Capital, Inc.
(the "Adviser") or Wilmington Trust Company, the proposed U.S.
Adviser, receive an annual stipend of $8,000 for serving on the
Board and its committees, an additional $500 for each Board
meeting which they attend and reimbursement for out-of-pocket
expenses in connection with their attendance at directors'
meetings. The Fund does not pay any pension or other benefits to
its directors. For the fiscal year ended December 31, 1996, the
following table sets forth compensation received by the Fund's
directors from the Fund and The First Philippine Fund Inc., a
registered closed-end investment company for which Clemente
Capital, Inc., acts as investment adviser.
Total Compensation from
Name of Director Compensation the Fund and The First
from the Fund Philippine Fund Inc.
Leopoldo M. Clemente, Jr. 0 0
Sam Nakagama $10,000 $10,000
Adrian C. Cassidy 10,000 22,500
G. Peter Schieferdecker 10,000 10,000
Thomas H. Lenagh 10,000 10,000
Lilia C. Clemente 0 0
Baron J.G.A. Sirtema van
Grovestins 10,000 10,000
Robert B. Oxnam 10,500 20,500
<PAGE>
The Adviser, which pays the compensation and certain expenses of
its personnel who serve as directors and officers of the Fund,
receives an investment advisory fee.
Fulbright & Jaworski L.L.P., of which William H. Bohnett, the
Secretary of the Fund, is a partner, acts as legal counsel to the
Fund.
THE FUND'S BOARD OF DIRECTORS RECOMMENDS THAT
STOCKHOLDERS VOTE "FOR" THE ELECTION OF DIRECTORS
PURSUANT TO PROPOSAL NOS. 2 & 3
<PAGE>
PROPOSAL NO. 4
RATIFICATION OF THE SELECTION OF
INDEPENDENT ACCOUNTANTS
By vote of the Board of Directors, including the vote of the
non-interested Directors, the firm of Price Waterhouse LLP has been
selected as the Fund's independent accountants for the year ending
December 31, 1997. Such selection is being submitted to the
stockholders for ratification. The employment of Price Waterhouse
LLP is conditioned on the right of the Fund, by majority vote of
its stockholders, to terminate such employment. Price Waterhouse
LLP has acted as the Fund's independent accountants from its
inception through December 31, 1996.
The services to be provided by the Fund's independent
accountants include examination of the Fund's annual financial
statements and limited review of its unaudited quarterly
statements, assistance and consultation in connection with
Securities and Exchange Commission and New York Stock Exchange
filings, and preparation of the Fund's annual federal and state
income tax returns.
A representative of Price Waterhouse LLP is expected to be
present at the meeting and will have the opportunity to make a
statement if he or she so desires. This representative will also
be available to respond to appropriate questions.
Proposal No. 4 requires the affirmative vote of a majority of
shares voting at the Meeting for passage.
THE FUND'S BOARD OF DIRECTORS RECOMMENDS THAT
STOCKHOLDERS VOTE "FOR" THE RATIFICATION OF PRICE
WATERHOUSE LLP AS THE FUND'S INDEPENDENT ACCOUNTANTS
<PAGE>
PROPOSAL NO. 5
SHAREHOLDER PROPOSAL
A shareholder has submitted the following proposal for
inclusion in this Proxy Statement. Such shareholder claims
beneficial ownership of 1,501 shares of Common Stock, representing
less than 1/10 of 1% of the Fund's outstanding Common Stock.
The Fund will provide the name and address of the proposing
shareholder to any shareholder of the Fund who so requests such
information by written or oral request to Lilia C. Clemente at
Clemente Global Growth Fund, Inc., 152 West 57th Street, New
York, New York 10019, telephone number 212-765-0700.
RESOLVED: It is requested that, as soon as
practicable, the Board shall seriously consider soliciting
competitive proposals for a new investment advisor for the Fund.
The shareholder has requested that the following statement be
included in the Proxy Statement in support of the proposal:
The Fund's objective is long term capital appreciation.
Clemente Capital Inc. ("Clemente"), the current investment advisor
has had more than nine years at the helm to prove that it is up to
the task. However, despite an excellent investment climate
over that time period, the Fund's performance has been
disappointing. From its inception on July 1, 1987 through
September 30, 1996, the Fund's market return has averaged less than
3% per year. According to Lipper, the Fund's annualized market
returns for the one-year, three-year and five-year periods ending
September 30, 1996 were 7.5%, 1.2% and 5.4%, respectively.
In its July 26, 1996 report, Morningstar summed up the Fund's
track record as follows: "CLM's year-to-date return is more than
four percentage points behind the . . .average [return of 180
open-end world stock funds]. Nor is this underperformance an
isolated incident. The Fund's trailing five-year return also lands
near the bottom of the open-end group, in addition to lagging the
[MSCI World] index." Because of this underperformance, the Fund's
shares on October 19, 1996 were trading at a discount of 24.8% to
their net asset value, the largest discount of any closed-end fund
listed on the New York Stock Exchange.
Nine years of underperformance is enough. There are many
highly qualified investment advisory firms that can be solicited as
potential replacements for Clemente. For example, Putnam Global
Growth A Fund, Scudder International Fund, Fidelity Overseas Fund
and Templeton Foreign I Fund are open-end funds with average annual
returns for the ten-year period ending September 30, 1996 of
10.69%, 10.30%, 13.09% and 15.18%, respectively. Proposals can be
solicited from their investment advisors or from other investment
advisors with good track records.
To summarize, the stockholders of the Fund are entitled to
better performance than Clemente has been able to deliver.
Therefore, it is time for the Board to assert its independence from
Clemente and, in the best interest of shareholders, seek a new
investment advisor for the Fund. We recommend that the Board
solicit competitive proposals from the best investment advisory
firms that the Board can find, that it evaluate these proposals
based upon investment performance and proposed fees and any other
factors the Board deems appropriate and relevant, and that it enter
into an investment advisory contract with the winning firm.
The Board of Directors' Position on the Shareholder Proposal
The Fund's Board of Directors votes annually on whether to
renew the Fund's advisory contract with Clemente Capital. To do
so, the Board receives and reviews extensive documentation,
including comparative performance and fee information for other
advisers managing registered investment companies having investment
objectives and policies similar to that of the Fund. In that
regard, the Board is cognizant that the existing contract with
Clemente Capital, which provides for a fee based on the Fund's
performance relative to that of the FT-Actuaries World Index on a
rolling three year basis, is highly unusual. Very few funds have
such a performance fee to the Board's knowledge and none of the
more than 30 funds with which the Fund is directly compared each
year by the Board have such an arrangement. The fact that the
Fund's existing contract aligns the Adviser's compensation with the
interests of the Fund's shareholders in maximizing performance in
a way that few other contracts do has been an important part of the
Board's deliberations on renewal.
In addition to studying quantitative data, the Board looks at
a wide variety of qualitative factors in its annual review. Among
other factors, the Board considers the experience and expertise of
the investment personnel of the Adviser and the investment research
techniques used by, and coverage of, the Adviser. All of these are
deemed to be important in forming a collective judgment. Three
year performance statistics, while disappointing and of significant
concern to the Board, are put in a wider context of evaluating an
adviser which produced exceptional total investment returns (as
stated in the Fund's annual reports) for the Fund in 1993 (up
53.55%) and 1989 (up 39.39%), and which has widely recognized
expertise in global markets investing. Also, the Fund's recent
performance has been stronger, with the Fund's NAV up 5.2% for
the first quarter of 1997 through March 26, compared with a rise
of 1.67% for the FT-Index. The Board believes it must look at the
totality of the circumstances in the exercise of its fiduciary
duties, which is what any fund board must do. No board,
consistent with its fiduciary duty, can choose to focus only on a
few highly changeable statistics as the basis for a decision which
must be premised on the balancing of numerous quantitative and
qualitative criteria.
As outlined above and in Proposal No. 1, the Board began a
process a year ago which has now involved six full Board meetings
in the last twelve months, to exhaustively analyze the performance
of Clemente Capital to the Fund. What has resulted is a
recommendation to add Wilmington Trust as the U.S. Adviser, while
preserving the global markets expertise of Clemente Capital and an
advisory contract that the Board believes is highly favorable to
shareholders on a cost of advisory services basis. The Board
believes this course of action has the highest probability of
achieving a sustained improvement in investment performance and is
far superior to the uncertainties of a process which might lead to
the approval of an adviser unfamiliar with the Fund's portfolio and
a contract markedly less advantageous to shareholders. For the
foregoing reasons, the Board of Directors opposes Proposal No. 5.
Proposal No. 5 requires the affirmative vote of a majority of
shares voting at the Meeting for passage.
THE BOARD OF DIRECTORS RECOMMENDS SHAREHOLDERS
VOTE "NO" ON PROPOSAL NO. 5
<PAGE>
THE INVESTMENT ADVISER, THE PROPOSED U.S. ADVISER
AND THE ADMINISTRATOR
The Investment Adviser
Clemente Capital, Inc., the Fund's investment adviser, has
its principal office at 152 West 57th Street, New York, New York
10019. Lilia C. Clemente, Chairman and Director of the Fund, is
Chairman, Chief Executive Officer and a Director of the Adviser.
Leopoldo M. Clemente, Jr., President and Director of the Fund, is
President, Chief Investment Officer and a Director of the Adviser.
In addition to Mr. and Mrs. Clemente, the Adviser's Directors are:
Salvador Diaz-Verson, Jr., President of Diaz- Verson Capital
Investments, Inc., an investment advisory firm located in Columbus,
Georgia; Robert J. Christian, Chief Investment Officer, Wilmington
Trust Company; Irving L. Gartenberg, Esq., general counsel to the
Adviser; and Thomas J. Prapas, Managing Director and Chief
Economist for the Adviser. Mrs. Clemente owns approximately 60% of
the outstanding Common Stock of the Adviser. The address for Mr.
and Mrs. Clemente and Mr. Prapas is 152 West 57th Street, New York,
New York 10019. The address for Mr. Diaz-Verson is 1200 Brookstone
Centre Parkway, Suite 105, Columbus, Georgia 31904; the address for
Mr. Christian is 1100 North Market Street, Wilmington, Delaware
19890; and the address for Mr. Gartenberg is 122 East 42nd Street,
46th Floor, New York, New York 10017. Wilmington Trust Company
owns 24.9% of the outstanding Common Stock of the Adviser.
The Proposed U.S. Adviser
Wilmington Trust Company. Wilmington Trust Company
("Wilmington Trust") is a Delaware corporation with principal
offices at 1100 North Market Street, Wilmington, Delaware 19890.
Wilmington Trust is a wholly-owned subsidiary of Wilmington Trust
Corporation, 1100 North Market Street, Wilmington, Delaware 19890.
Ted T. Cecala is the principal executive officer of
Wilmington Trust. The name and principal occupation of each
director of Wilmington Trust as of April 1, 1997 were
as follows:
Name of Director Occupation
Ted T. Cecala Chief Executive Officer and Chairman of
the Board of Wilmington Trust
Andrew B. Kirkpatrick Of counsel to the law firm of Morris,
Nichols, Arsht and Tunnell
David P. Roselle President of the University of Delaware
Mary Jornlin-Theisen Civic leader
Charles S. Crompton, Jr. Partner of the law firm of Potter,
Anderson & Corroon
Edward B. du Pont Private investor
Stacey J. Mobley Senior Vice President, external affairs,
E.I. Du Pont de Nemours and Company
Carolyn S. Burger Principal of CB Associates, Inc., a
consulting firm
Robert V.A. Harra, Jr. President, Chief Operating Officer and
Treasurer of Wilmington Trust
Leonard W. Quill Retired
Richard R. Collins Chairman of Collins, Inc, a consulting
firm
Hugh E. Miller Retired
Thomas P. Sweeney Partner of the law firm of Richards,
Layton & Finger
Robert H. Bolling, Jr. Retired
H. Stewart Dunn, Jr. Partner of the law firm of Ivins,
Phillips & Barker
R. Keith Elliot Chairman of the Board and Chief Executive
Officer of Hercules Incorporated
Bernard J. Taylor, II Retired
Robert C. Forney Retired
Rex L. Mears President of Ray S. Mears and Sons, Inc.
Robert W. Tunnell, Jr. Managing Partner of the law firm of
Tunnell Companies, L.P.
All of the above persons may be reached c/o Wilmington Trust,
1100 North Market Street, Wilmington, Delaware 19890.
The Administrator
Rodney Square Management Corporation, a wholly owned
subsidiary of Wilmington Trust, the Fund's administrator (the
"Administrator"), has its principal office at Rodney Square North,
1100 North Market Street, Wilmington, Delaware 19890. Pursuant to
the Fund's Administration and Accounting Services Agreement, for
rendering administrative and accounting services, the Administrator
is paid a fee at an annual rate of .15% on the first $100 million
in assets, .08% on the next $200 million in assets and .06% on any
assets in excess of $300 million of the Fund's average net assets,
subject to a minimum fee of $65,000 annually.
MISCELLANEOUS
As of the date of this Proxy Statement, management does not
know of any other matters that will come before the meeting. In
the event that any other matter properly comes before the meeting,
the persons named in the enclosed form of proxy intend to vote all
proxies in accordance with their best judgment on such
matters.
All shares represented by proxies sent to the Fund to be
voted at the Annual Meeting will be voted if received prior to the
meeting. Votes shall be tabulated by the Fund's transfer agent.
Abstentions do not constitute a vote "for" or "against" a matter
and will be disregarded in determining votes cast on an issue.
Broker "non-votes" (i.e., proxies from brokers or nominees
indicating that such persons have not received instructions from
the beneficial owner or other persons entitled to vote the shares
on a particular matter with respect to which the brokers or
nominees do not have discretionary power) will treated the same as
abstentions. Abstentions and broker "non-votes" will have the
effect of a "no" vote for purposes of obtaining the requisite
approval of each proposal.
Quorum. A quorum is constituted with respect to the Fund by
the presence in person or by proxy of the holders of more than 50%
of the outstanding shares of the Fund entitled to vote at the
Meeting. For purposes of determining the presence of a quorum for
transacting business at the Meeting, abstentions, but not broker
"non-votes" (that is, proxies from brokers or nominees indicating
that such persons have not received instructions from the
beneficial owners or other persons entitled to vote shares on a
particular matter with respect to which the brokers or nominees do
not have discretionary power), will be treated as shares that are
present at the Meeting but which have not been voted.
In the event that a quorum is not present at the Meeting, or
in the event that a quorum is present at the Meeting but sufficient
votes to approve either of the proposals are not received, the
persons named as proxies, or their substitutes, may propose one or
more adjournments of the Meeting to permit the further solicitation
of proxies. Any such adjournment will require the affirmative vote
of a majority of those shares affected by the adjournment that are
represented at the Meeting in person or by proxy. If a quorum is
present, the persons named as proxies will vote those proxies which
they are entitled to vote FOR either proposal in favor of such
adjournments, and will vote those proxies required to be voted
AGAINST both proposals against any adjournment.
ADDITIONAL INFORMATION
Wilmington Trust or its affiliate, Rodney Square Management
Corp. ("RSMC"), also serves as the adviser to the following
registered investment companies:
<TABLE>
<CAPTION>
Approximate Net
Investment Adviser Name of Assets as of Annual Rate of
Investment Company April 1, 1997 Compensation
- -------------------------------------------------------------------------------
</CAPTION>
<S> <C> <C> <C>
RSMC Rodney Square Fund $1,355,015,301 47 basis points (.47%)
RSMC Rodney Square Tax-
Exempt Fund 290,258,080 47 basis points (.47%)
Wilmington Trust Rodney Square Strategic
Fixed-Income Fund 47,749,811 50 basis points (.50%)
RSMC Rodney Square Multi
-Manager Fund 71,943,228 100 basis points (1.0%) of
which 50 basis points (.50%)
are paid to (unaffiliated)
sub-advisers
RSMC (serves as
sub-adviser) Emerald Funds Tax-
Exempt Portfolio 162,327,296 15 basis points (.15%)
</TABLE>
As of January 15, 1997, LTB Trust, 6620 W. Broad Street,
Richmond, Virginia 23230 owned approximately 5.3% of the
outstanding common shares of the Fund. As of such date, no other
person owned of record or, to the knowledge of management,
beneficially owned more than 5% of the outstanding shares of the
Fund.
1998 ANNUAL MEETING
Stockholder proposals meeting the requirements contained in
the proxy rules adopted by the Securities and Exchange Commission
may, under certain conditions, be included in the Fund's proxy
material for an annual meeting of stockholders. Pursuant to these
rules, proposals of stockholders intended to be presented at the
Fund's 1998 Annual Meeting of Stockholders must be received by the
Fund on or before January 30, 1998 to be considered for inclusion
in the Fund's Proxy Statement and form of proxy relating to that
Annual Meeting. Receipt by the Fund of a stockholder proposal in
a timely manner does not insure the inclusion of such proposal in
the Fund's proxy material.
CLEMENTE GLOBAL GROWTH FUND, INC.
WILLIAM H. BOHNETT
Secretary
Dated: April 30, 1997
PLEASE SIGN, DATE AND MAIL THE ENCLOSED PROXY CARD NOW
<PAGE>
P R O X Y
CLEMENTE GLOBAL GROWTH FUND, INC.
The undersigned stockholder of Clemente Global Growth Fund,
Inc. (the "Fund") hereby constitutes and appoints Lilia C.
Clemente, Robert B. Oxnam and William H. Bohnett, or any of them,
the action of a majority of them voting to be controlling, as proxy
of the undersigned, with full power of substitution, to vote all
shares of Common Stock of the Fund standing in his name on the
books of the Fund at the Annual Meeting of Stockholders of the Fund
to be held on Thursday, May 29, 1997 at 9:00 A.M., New York time,
at Le Parker Meridien, 119 West 56th Street, New York, New York or
at any adjournment thereof, with all the powers which the
undersigned would possess if personally present, as designated on
the reverse hereof:
The undersigned hereby instructs the said proxies (i) to vote in
accordance with the aforementioned instructions with respect to the
approval or disapproval of the U.S. Advisory Agreement, the
election of Directors, the ratification of the selection by the
Board of Directors of the Fund's independent accountants, and the
approval or disapproval of the shareholder proposal, but, if no
such specification is made, (ii) to vote for the U.S. Advisory
Agreement, (iii) to vote for the election of one Director into
Class II (expiring 1999), (iv) to vote for the election of three
directors into Class III (expiring 2000), (v) to vote for the
ratification of the selection by the Board of Directors of the
Fund's independent accountants, (vi) to vote against the
shareholder proposal, and (vii) to vote in their discretion with
respect to such other matters as may properly come before the
Meeting.
PROXY SOLICITED ON BEHALF OF CLEMENTE GLOBAL GROWTH FUND, INC.'S
BOARD OF DIRECTORS FOR ANNUAL MEETING OF STOCKHOLDERS -- May 29,
1997
(To be dated and signed on reverse side)
<PAGE>
Please mark boxes [ ] or [X] in blue or black ink.
(a) To approve or disapprove a U.S. Advisory Agreement among the
Fund, Clemente Capital, Inc. and Wilmington Trust Company pursuant
to which Wilmington Trust Company will manage the U.S. portion of
the Fund's portfolio, which proposal the Board of Directors favors;
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
(b) Election of one Director, as set forth below, for the term
specified below and until his successor is duly elected and
qualified:
Class II (expiring 1999) - Robert J. Christian
FOR NOMINEE LISTED ABOVE WITHHOLD AUTHORITY
(except as indicated to the to vote for nominee
contrary below) [ ] listed above [ ]
(INSTRUCTION: To withhold authority to vote for an
individual, write that nominee's name in the space provided below.)
- -------------------------------------------------------------------
(c) Election of three Directors, as set forth below, for the terms
specified below and until their successors are duly elected and
qualified:
Class III (expiring 2000) - Thomas H. Lenagh,
Sam Nakagama and G. Peter Schieferdecker
FOR ALL NOMINEES LISTED ABOVE WITHHOLD AUTHORITY
(except as indicated to the to vote for all nominees
contrary below) [ ] listed above [ ]
(INSTRUCTION: To withhold authority to vote for an
individual, write that nominee's name in the space provided below.)
- ------------------------------------------------------------------
(d) To ratify the selection by the Board of Directors of Price
Waterhouse LLP as the Fund's independent accountants for the
year ending December 31, 1997;
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
- ------------------------------------------------------------------
<PAGE>
(e) To approve or disapprove a shareholder proposal to request the
Board of Directors to seriously consider soliciting
competitive proposals for a new investment adviser to the
Fund, which proposal the Board of Directors opposes;
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
- -----------------------------------------------------------------
(f) To transact such other business as may properly come before
the Meeting or any adjournment or adjournments thereof; all as
set forth in the Notice of Annual Meeting, dated April 30,
1997, and the accompanying Proxy Statement, receipt of which
is hereby acknowledged.
- ----------------------------------------------------------------
IMPORTANT: Signature(s) should correspond with the stencilled
name appearing hereon. When signing in a fiduciary
or representative capacity, give full title as
such. When more than one owner, each should sign.
Dated:______________________________, 1997
_________________________________________
_________________________________________
Sign, Date and Return the Proxy Card Promptly Using the Enclosed
Envelope.
EXHIBIT A
U.S. ADVISORY AGREEMENT
AGREEMENT made as of May 29, 1997 between Clemente
Capital, Inc., a New York corporation (the "Adviser"), Clemente
Global Growth Fund, Inc., a Maryland corporation (the "Fund") and
Wilmington Trust Company, a Delaware corporation (the "U.S.
Adviser").
WHEREAS, the Fund is registered as a closed-end,
management investment company under the Investment Company Act of
1940, as amended (the "1940 Act");
WHEREAS, the Adviser has been appointed investment
adviser to the Fund, pursuant to an Investment Advisory Agreement
dated June 19, 1987, which has been approved by the Fund's
shareholders and by the Fund's Board of Directors, most recently on
April 24, 1996 (the "Advisory Agreement");
WHEREAS, the Adviser and the Fund desire to retain the
U.S. Adviser to assist in the provision of a continuous investment
program for the U.S. portion of the Fund's portfolio (the "U.S.
Portfolio") and the U.S. Adviser is willing to do so; and
WHEREAS, the Board of Directors of the Fund has approved
this Agreement, subject to approval by the shareholders of the
Fund, and the U.S. Adviser is willing to furnish such services upon
the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the premises and
mutual covenants herein contained, it is agreed between the parties
hereto as follows:
1. Appointment. The Adviser and the Fund hereby
appoint the U.S. Adviser to act as adviser to the Fund with respect
to the U.S. Portfolio. Intending to be legally bound, the U.S.
Adviser accepts such appointment and agrees to render the services
herein set forth for the compensation herein provided.
2. Advisory Services. Subject to the supervision of
the Fund's Board of Directors, the U.S. Adviser will assist the
Adviser by providing a continuous investment program for the U.S.
Portfolio, including investment research and management with
respect to all securities and investments and cash equivalents
comprising the U.S. Portfolio. The parties agree that securities
of any company whose primary trading market is located in the
United States are eligible for inclusion in the U.S. Portfolio.
The U.S. Adviser will provide services under this Agreement in
accordance with the Fund's investment objective, policies and
restrictions as stated in the Fund's Prospectus and resolutions of
the Fund's Board of Directors applicable to the Fund.
Without limiting the generality of the foregoing, the
U.S. Adviser further agrees that it:
(a) will determine from time to time what
securities and other investments will be purchased, retained or
sold for the U.S. Portfolio;
(b) will manage in consultation with the Adviser
the U.S. Portfolio's temporary investments in securities, cash and
cash equivalents;
(c) will place orders pursuant to its investment
determinations for the U.S. Portfolio either directly with the
issuer or with any broker or dealer;
(d) will consult with the Adviser on a continuous
basis as to the portion of the Fund's total assets which shall be
invested in the U.S. Portfolio;
(e) will attend regular business and
investment-related meetings with the Fund's Board of Directors and
the Adviser if requested to do so by the Fund and/or the Adviser;
and
(f) will maintain books and records with respect
to the securities transactions for the U.S. Portfolio, furnish to
the Adviser and the Fund's Board of Directors such periodic and
special reports as they may request with respect to the U.S.
Portfolio, and provide in advance to the Adviser all reports to the
Board of Directors for examination and review within a reasonable
time prior to the Fund's Board meetings.
3. Covenants by the U.S. Adviser. The U.S. Adviser
agrees with respect to the services provided to the Fund that it:
(a) will conform with all Rules and Regulations of
the Securities and Exchange Commission;
(b) will telecopy trade information to the Adviser
no later than the first business day following the day of the trade
and cause broker confirmations to be sent directly to the Adviser
and adopt such other trade reporting, settlement and clearance
procedures with respect to the Fund as shall be in accordance with
the Fund's existing procedures and as mutually agreed by the
parties hereto; and
(c) will treat confidentially and as proprietary
information of the Fund all records and other information relative
to the Fund and prior, present or potential shareholders, and will
not use such records and information for any purpose other than
performance of its responsibilities and duties hereunder (except
after prior notification to and approval in writing by the Fund,
which approval shall not be unreasonably withheld, and may not be
withheld and will be deemed granted where the U.S. Adviser may be
exposed to civil or criminal contempt proceedings for failure to
comply, when requested to divulge such information by duly
constituted authorities, or when so requested by the Fund).
4. Services Not Exclusive. The services furnished by
the U.S. Adviser hereunder are deemed not to be exclusive, and
nothing in this Agreement shall (i) prevent the U.S. Adviser or any
affiliated person (as defined in the 1940 Act) of the U.S. Adviser
or any affiliated person of such person from acting as investment
adviser or manager for any other person or persons, including other
management investment companies or investment vehicles or accounts
of any type with investment objectives and policies the same as or
similar to those of the Fund or (ii) limit or restrict the U.S.
Adviser or any such affiliated person from buying, selling or
trading any securities or other investments (including any
securities or other investments which the Fund is eligible to buy)
for its or their own accounts or for the accounts of others for
whom it or they may be acting; provided, however, that the U.S.
Adviser agrees that it will not undertake any activities which, in
its reasonable judgment, will adversely affect the performance of
its obligations under this Agreement.
5. U.S. Portfolio Transactions. Investment decisions
for the U.S. Portfolio shall be made by the U.S. Adviser
independently from those for any other investment companies and
accounts advised or managed by the U.S. Adviser. The U.S.
Portfolio and such investment companies and accounts may, however,
invest in the same securities. When a purchase or sale of the same
security is made at substantially the same time on behalf of the
U.S. Portfolio and/or another investment company or account, the
transaction will be averaged as to price, and available investments
allocated as to amount, in a manner which the U.S. Adviser believes
to be equitable to the Fund and such other investment company or
account. In some instances, this investment procedure may
adversely affect the price paid or received by the Fund or the size
of the position obtained or sold by the Fund. To the extent
permitted by law, the U.S. Adviser may aggregate the securities to
be sold or purchased for the U.S. Portfolio with those to be sold
or purchased for other investment companies or accounts in order to
obtain best execution.
Either the Adviser, or at the U.S. Adviser's option, the
U.S. Adviser shall place orders for the purchase and sale of
portfolio securities for the U.S. Portfolio and will solicit
broker-dealers to execute transactions in accordance with the
Fund's policies and restrictions regarding brokerage allocations.
If applicable, the U.S. Adviser shall place orders pursuant to its
investment determinations for the U.S. Portfolio either directly
with the issuer or with any broker or dealer. If it executes
portfolio transactions and selects brokers or dealers, the U.S.
Adviser shall use its reasonable best efforts to seek the most
favorable execution of orders, after taking into account all
factors the U.S. Adviser deems relevant, including 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 the commission, if any, both for
the specific transaction and on a continuing basis. Consistent
with this obligation, the U.S. Adviser may, to the extent permitted
by law, purchase and sell portfolio securities to and from brokers
and dealers who provide brokerage and/or research services (within
the meaning of Section 28(e) of the Securities Exchange Act of
1934) to or for the benefit of the U.S. Portfolio of the Fund
and/or other accounts over which the U.S. Adviser or any of its
affiliates exercises investment discretion. The U.S. Adviser is
authorized to pay to a broker or dealer who provides such brokerage
and/or research services a commission for executing a portfolio
transaction for the Fund which is in excess of the amount of
commission another broker or dealer would have charged for
effecting that transaction if the U.S. Adviser determines in good
faith that such commission was reasonable in relation to the value
of the brokerage and/or research services provided by such broker
or dealer, viewed in terms of either that particular transaction or
the U.S. Adviser's overall responsibilities to the Fund. In no
instance will portfolio securities be purchased from or sold to the
Adviser or the U.S. Adviser or any affiliated person of either
thereof, except as permitted by Rules and Regulations of the
Securities and Exchange Commission.
6. Books and Records. In compliance with the
requirements of Rule 31a-3 under the 1940 Act, the U.S. 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 records upon the Fund's request. The U.S.
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.
7. Expenses. During the term of this Agreement, the
U.S. Adviser will pay all expenses incurred by it in connection
with its activities under this Agreement other than the cost of
securities, commodities and other investments (including brokerage
commissions and other transaction charges, if any) purchased for
the Fund. Nothing herein, however, shall be deemed to require the
U.S. Adviser to pay any expenses of the Fund or the Adviser.
8. Compensation. For the services provided and the
expenses assumed with respect to the U.S. Portfolio pursuant to
this Agreement, the U.S. Adviser will be entitled to a fee,
computed monthly, from the Adviser equal to 25% of the fees
received by the Adviser from the Fund pursuant to the Advisory
Agreement.
9. Standard of Care; Limitation of Liability. The U.S.
Adviser shall exercise due care and diligence and use the same
skill and care in providing its services hereunder as it uses in
providing services to other investment companies, accounts and
customers, but shall not be liable for any action taken or omitted
by the U.S. Adviser in the absence of bad faith, willful
misconduct, gross negligence or reckless disregard of its duties.
10. Reference to the U.S. Adviser. Neither the Adviser
nor any affiliate or agent of it shall make reference to or use the
name of the U.S. Adviser or any of its affiliates, or any of their
clients, except references concerning the identity of and services
provided by the U.S. Adviser to the Fund, which references shall
not differ in substance from those included in the most recent
proxy statement or annual report of the Fund, or the Fund's current
registration statement, this Agreement and the Advisory Agreement
between the Adviser and the Fund, in any advertising or promotional
materials without the prior approval of the U.S. Adviser, which
approval shall not be unreasonably withheld or delayed. The
Adviser hereby agrees to make all reasonable efforts to cause the
Fund and any affiliate thereof to satisfy the foregoing obligation.
11. Duration and Termination. Unless sooner terminated,
this Agreement shall continue until May 29, 1999, and thereafter
shall continue automatically for successive annual periods,
provided such continuance is specifically approved at least
annually by the Fund's Board of Directors or the vote of a
"majority of the outstanding voting securities of the Fund,"
defined as the lesser of (a) 67% of the shares of the Fund
represented at a meeting if holders of more than 50% of the
outstanding shares of the Fund are present in person or by proxy or
(b) more than 50% of the outstanding shares of the Fund, provided
that in either event its continuance also is approved by a majority
of the Fund's Directors who are not "interested persons" (as
defined in the 1940 Act) 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 at any time without
penalty, on 60 days' notice, by the Fund's Board of Directors, by
the Adviser or by the U.S. Adviser or by vote of a majority of the
outstanding voting securities of the Fund. This Agreement will
terminate automatically in the event of its assignment (as defined
in the 1940 Act).
12. Amendment of this Agreement. 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 the vote of the holders of a majority of the
outstanding voting securities of the Fund and by the Board of
Directors of the Fund, including a majority of the Directors who
are not interested persons of the Adviser or the U.S. Adviser, cast
in person at a meeting called for the purpose of voting on such
approval.
13. Notice. Any notice, advice or report to be given
pursuant to this Agreement shall be delivered or mailed:
To the U.S. Adviser at:
1100 North Market Street
Wilmington, Delaware 19890
Attention: Robert J. Christian
To the Adviser at:
152 West 57th Street
New York, New York 10019
To the Fund at:
152 West 57th Street
New York, New York 10019
with a copy to:
William H. Bohnett
Fulbright & Jaworski L.L.P.
666 Fifth Avenue
New York, New York 10103
14. Miscellaneous. The captions in this Agreement are
included for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect their
construction or effect. If any provision of this Agreement shall
be held or made invalid by a court decision, statute, rule or
otherwise, the remainder of this Agreement shall not be affected
thereby.
This Agreement constitutes the entire agreement of the
parties, shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and shall be
governed by New York law.
15. Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same
instrument.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of
the day and year first above written.
CLEMENTE GLOBAL GROWTH
FUND, INC.
By:
Name:
Title:
CLEMENTE CAPITAL, INC.
By:
Name:
Title:
WILMINGTON TRUST COMPANY
By:
Name:
Title:
