S&C Draft of May 8, 1998
ADMINISTRATION AGREEMENT
This ADMINISTRATION AGREEMENT, dated as of this __th day of
May, 1998, by and between _____________, a _____________ banking corporation
(the "Administrator"), and Xxxxxxx X. Xxxxxx III, Xxxxx X. X'Xxxxx and Xxxxxx
X. Xxxxxxx (collectively, the "Trustees"), not in their individual capacities
but solely as Trustees of Xxxxx Xxxxxx Automatic Common Exchange Security
Trust (the "Trust"), a trust organized under the laws of the State of New York
under and by virtue of an Amended and Restated Trust Agreement, dated as of
May __, 1998 (the "Trust Agreement").
W I T N E S S E T H
WHEREAS, the Trust is a non-diversified, closed-end
management investment company, as defined in the Investment Company Act of
1940 (the "Investment Company Act"), formed to purchase and hold certain U.S.
treasury securities (the "Treasury Securities"), to enter into and hold
forward purchase contracts (the "Contracts") with one or more existing
shareholders of The Xxxxx Xxxxxx Companies Inc. (the "Company") and to issue
Trust Automatic Common Exchange Securities (the "Securities") in accordance
with the terms and conditions of the Trust Agreement;
WHEREAS, the Trustees desire to engage the services of the
Administrator to assume certain duties and responsibilities of the Trustees
under the Trust Agreement and the Investment Company Act and to undertake
certain services on behalf of and subject to the supervision of the Trustees
as provided herein; and
WHEREAS, the Administrator is qualified and willing to
assume such duties and responsibilities and to undertake to render such
services, subject to the supervision of the Trustees, on the terms and
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, the parties agree as follows:
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ARTICLE I
DEFINITIONS
1.1 Definitions. Capitalized terms not otherwise defined
herein shall have the respective meanings specified in the Trust Agreement.
ARTICLE II
ENGAGEMENT OF ADMINISTRATOR
2.1 Engagement. The Trustees hereby engage the
Administrator, and the Administrator hereby agrees to be so engaged, to
provide the services hereinafter enumerated.
2.2 Services of Administrator. Subject to the supervision of
the Trustees, the Administrator shall effect the matters set forth further in
Sections 2.3, 2.4 and 2.5 of the Trust Agreement, to the extent such
responsibilities can lawfully be delegated to the Administrator; provided,
however, that the Administrator shall not (i) render investment advisory
services to the Trust as defined in the Investment Company Act or the
Investment Advisers Act of 1940; (ii) have the power of the Trustees to sell
the Contract or the Treasury Securities except as provided in Sections 2.5 of
the Trust Agreement; or (iii) have the power to select the independent public
accountants for the Trust. Additionally, the Administrator shall be
responsible for rendering the following services:
(a) instruct the Paying Agent to pay out of the net proceeds
of the sale of the Securities the fees and expenses of the Trust
incurred in connection with the offering of the Securities as
specified in Schedule I to the Fund Expense Agreement;
(b) instruct the Paying Agent to pay out of the net proceeds
of the sale of the Securities the fees and expenses of the Trust
incurred in connection with the
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organization of the Trust as specified in Schedule I to the Fund
Expense Agreement;
(c) instruct the Paying Agent to effect the transactions set
forth in Sections 2.3, 2.4 and 2.5 of the Trust Agreement and to
otherwise perform the duties of the Paying Agent referred to in the
Trust Agreement;
(d) with the approval of the Trustees, engage
legal and other professional advisors, subject to
clause 2.2 (iii) above;
(e) receive all demands, bills and invoices for expenses
incurred by or on behalf of the Trust, and pay the same, or cause the
Paying Agent to pay the same, out of moneys paid to the Administrator
pursuant to the Fund Expense Agreement dated the date hereof between
Xxxxxxx, Sachs & Co., and _____________ (the "Fund Expense
Agreement") but in no event out of any assets of the Trust except, as
provided in paragraphs (a) and (b) hereof, and give notice to
Xxxxxxx, Xxxxx & Co. pursuant to the Fund Indemnity Agreement dated
the date hereof between Xxxxxxx, Sachs & Co. and the Trustees (the
"Fund Indemnity Agreement") of any claim for Indemnification Expenses
(as defined in the Fund Indemnity Agreement) or any threatened claim
for Indemnification Expenses;
(f) (i) prepare and mail, file or publish, or, as
appropriate, direct the Paying Agent to prepare and mail, file or
publish, any notices, proxies, reports and other communications
required to be mailed or published pursuant to the Trust Agreement
and the Investment Company Act, (ii) keep (or cause to be kept) all
the books and records of the Trust (other than those to be kept by
the Paying Agent), and (iii) prepare (or cause to be prepared) and,
as necessary, file (or cause to be filed) any and all reports,
returns and other documents as required under the Investment Company
Act, the Securities Exchange Act of 1934, or the Code, or, as
reasonably requested by the Trustees, under any other applicable
laws, rules or
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regulations or otherwise; provided, however, that responsibility for
the adequacy and accuracy of any such reports, returns, etc. shall be
that of the Trustees and provided, further, that the Administrator
shall have no liability for the adequacy or accuracy of such reports,
returns, etc.;
(g) at the request of the Trustees and upon being furnished
with such reasonable security and indemnity against any related
expense or liability as the Administrator may require, institute and
prosecute, in accordance with the instructions of the Trustees, legal
or other appropriate proceedings to enforce any and all rights and
remedies of the Trust;
(h) receive and review on behalf of the Trust all notices,
reports, certificates and other documents regarding the Contract and
the Treasury Securities;
(i) make all necessary arrangements with respect to meetings
of Trustees and meetings of Holders, including, without limitation,
the preparation of notices, proxies and minutes, subject to the
approval of Trustees; and
(j) in conjunction with the Trustees, determine and publish,
in such manner as the Trustees shall direct in writing, the Trust's
net asset value in accordance with the Trust's policy as set forth in
the Prospectus.
2.3 Certain Rights of the Administrator. In connection
with the performance of its duties under this Agreement, the Administrator shall
not be liable to the Trust, the Trustees or any Holder (i) for any action taken
or for refraining from taking any action hereunder except in the case of its
willful misfeasance, bad faith, gross negligence or the reckless disregard of
its duties hereunder, (ii) with respect to any action taken or omitted to be
taken by it in good faith in accordance with the directions of the Trustees or
of any Trustee or (iii) in connection with the performance of its duties under
Section
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2.2(j) hereof, for good faith reliance upon information furnished by third
parties selected by the Administrator with due care. The Administrator shall
under no circumstances be liable for any indirect or consequential damages. The
Administrator may consult with counsel and the written advice of such counsel
shall be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon. The Administrator may perform its duties and exercise its rights
hereunder either directly or by or through agents or attorneys appointed with
due care by it but shall be liable for the acts and omissions of such persons to
the same extent as if the functions had been performed by the Administrator
itself except to the extent that the Trustees shall have directed the
Administrator to retain such persons in which event the Administrator shall not
be liable for such persons' acts or omissions. The Administrator shall not be
liable and shall be fully protected in acting upon any writing or document
reasonably believed by it to be genuine and to have been given, signed or made
by the proper person or persons and shall not be held to have notice of any
change of authority of any person until receipt of written notice thereof from a
Trustee. Without limiting the generality of the preceding sentence, the
Administrator (i) at its own cost, may select and employ independent accountants
acceptable to the Trustees (other than the independent public accountants
referred to in clause (iii) of Section 2.2 of this Agreement and Section 2.2(d)
of the Trust Agreement) to keep the financial books and records of the Trust, to
prepare the financial statements of the Trust and to prepare Trust tax returns,
and (ii) should the Trustees fail to do so, may select and engage attorneys
acceptable to the Trustees to prepare annual, semiannual and periodical reports,
notices of meetings and proxy statements, annual reports to holders of the
Securities and other documents required under the Investment Company Act or the
Securities Exchange Act of 1934, as amended.
2.4 Power of Attorney. The Trust hereby appoints the
Administrator, acting through any duly appointed officer, its attorney-in-fact
and agent for the purpose of
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performing the duties prescribed in Section 2.2(f)(iii) and 2.2(i).
2.5 Delivery of Certain Documents. The Trust will deliver to
the Administrator, promptly following the execution hereof: (a) a complete
conformed copy of the registration statement of the Trust under the Securities
Act of 1933, as amended, and the Investment Company Act, including all
amendments, exhibits and schedules thereto and (b) the XXXXX access codes
(Central Index Key, CIK Confirmation Code, Password and Password Modification
Access Code) employed to file such registration statement.
ARTICLE III
COMPENSATION OF ADMINISTRATOR
3.1 Compensation. For services to be rendered by the
Administrator pursuant to this Agreement, and for the payment of Trust
expenses pursuant to Section 2.2(e) hereof, the Administrator shall receive
only such fees and expenses as shall be paid to it pursuant to the terms of
the Fund Expense Agreement and shall have no recourse to the assets of the
Trust for the payment of any such amounts. No provision of this Administration
Agreement shall require the Administrator to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.
3.2 Additional Services. If and to the extent that the
Trustees shall request the Administrator to render services for the Trust,
other than those to be rendered by the Administrator hereunder, and if the
Administrator agrees to render such services, such additional services shall
be compensated separately on terms to be agreed upon between the Administrator
and the Trustees from time to time.
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ARTICLE IV
TERMINATION
4.1 Termination.
(a) This Agreement shall terminate immediately upon written
notice of termination from the Trustees to the Administrator if any of the
following events shall occur:
(i) If the Administrator shall violate any
provision of this Agreement, the Trust Agreement, or the Investment
Company Act, and after notice of such violation, shall not cure such
default within 30 days; or
(ii) If the Administrator shall be adjudged bankrupt or
insolvent by a court of competent juris diction, or an order shall be
made by a court of competent jurisdiction for the appointment of a
receiver, liquidator, or trustee of the Administrator, or of all or
substantially all of its property by reason of the foregoing, or
approving any petition filed against the Administrator for its
reorganization, and such adjudication or order shall remain in force
or unstayed for a period of 30 days; or
(iii) If the Administrator shall institute proceedings
for voluntary bankruptcy, or shall file a petition seeking
reorganization under the Federal bankruptcy laws, or for relief under
any law for the relief of debtors, or shall consent to the
appointment of a receiver of the Administrator or of all or
substantially all of its property, or shall make a general assignment
for the benefit of its creditors, or shall admit in writing its
inability to pay its debts generally as they become due; or
(iv) Upon the voluntary or involuntary dissolution of
the Administrator, or unless the Trust
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shall have given its prior written consent thereto, the merger or
consolidation of the Administrator with any other entity.
If any of the events specified in clauses (ii), (iii) or
(iv) of this Section 4.1(a) shall occur, the Administrator shall give
immediate written notice thereof to the Trustees.
(b) Notwithstanding anything to the contrary contained
herein, this Agreement shall terminate immediately (i) upon termination of the
Trust Agreement, (ii) upon termination of the Paying Agent Agreement, (iii)
upon termination of the Collateral Agreement, (iv) upon termination of the
Custodian Agreement or (v) upon the resignation or removal of the Custodian.
(c) This Agreement may be terminated by either party hereto
without penalty upon 60 days' prior written notice to the other party hereto;
provided that neither party hereto may terminate this Agreement pursuant to
this Section 4.1(c) unless a successor Administrator shall have been appointed
and shall have accepted the duties of the Administrator. If, within 30 days
after notice by the Administrator to the Trustees of termination of this
Agreement, no successor Administrator shall have been selected and accepted
the duties of the Administrator, the Administrator may apply to a court of
competent jurisdiction for the appointment of a successor Administrator.
4.2 Effect of Termination. The Administrator shall forthwith
upon termination of this Agreement deliver to the Trustees any records or
other property of the Trust then in the possession or custody of the
Administrator. Any obligation to indemnify the Administrator pursuant to
Section 6.6 shall survive the termination of this Agreement.
ARTICLE V
RECORDS AND REPORTS
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5.1 Books and Records; Inspection and Copying. The
Administrator shall keep (or cause to be kept) appropriate, and reasonably
detailed and accurate, books and records of all its activities pursuant to
this Agreement. The Trustees shall have the right to inspect such books and
records during the Administrator's normal business hours upon reasonable
request, and to make copies of the same at the expense of the Trust.
5.2 Access to Information. The Administrator shall make
available to each of the Trustees all information it receives and compiles
with respect to the Contracts and the Treasury Securities, the monies
available to the Trust, the financial condition of the Trust and all other
relevant matters concerning the Trust.
ARTICLE VI
MISCELLANEOUS
6.1 Binding Effect. Any corporation into which the
Administrator may be merged or converted or with which it may be consolidated,
or any corporation resulting from any merger, conversion or consolidation to
which the Administrator shall be a party, shall be the successor Administrator
hereunder and under the Trust Agreement without the execution or filing of any
paper, instrument or further act to be done on the part of the parties hereto,
provided that such corporation meets the requirements set forth in the Trust
Agreement and provided further that the Trustees have given their prior
written consent to the Administrator with respect to any such merger,
conversion or consolidation. This Agreement shall be binding on and inure to
the benefit of the parties hereto and their respective successors and
permitted assigns.
6.2 Entire Agreement. This Agreement contains the entire
agreement between the parties with respect to the matters contained herein and
supersedes all prior agreements or understandings, whether oral or written.
This Agreement
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shall not be amended, changed, modified, or discharged, in whole or in part,
except by an instrument in writing signed by both parties hereto, or their
respective successors or permitted assigns.
6.3 Notices. Any notice, report or other communication
required or permitted to be given hereunder shall be in writing, and shall,
unless some other method of giving such notice, report or other communication
is accepted by the party to whom it is to be given or is required by the Trust
Agreement or the Investment Company Act, be given by being mailed by U.S.
first class mail, certified or registered, return receipt requested, postage
prepaid, to the following addresses of the parties hereto:
The Trust: Xxxxx Xxxxxx Automatic Common
Exchange Security Trust
c/o Xxxxxx X. Xxxxxxx, Managing
Trustee
Xxxxxxx & Associates
000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
The Administrator: _____________
_____________
Attn: __________________
Telephone: _____________
Telecopier: ____________
Any party may at any time give written notice to the other
party that it wishes to change its address for the purposes of this Section
6.3.
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6.4 Applicable Law. The provisions of this Agreement shall
be construed and interpreted in accordance with the laws of the State of New
York as at the time in effect except to the extent such law is preempted by
federal law.
6.5 Non-assignability. This Agreement and the rights and
obligations of the parties hereunder may not be assigned or delegated by
either party without the prior written consent of the other party.
6.6 Indemnification. The Trustees shall indemnify and hold
the Administrator harmless from and against any loss, damages, cost or expense
(including the costs of investigation, preparation for and defense of legal
and/or administrative proceedings related to a claim against it and reasonable
attorneys' fees and disbursements), liability or claim incurred by reason of any
inaccuracy in information furnished to the Administrator by the Trustees, or any
act or omission in the course of, connected with or arising out of any services
to be rendered hereunder, provided that the Administrator shall not be
indemnified and held harmless from and against any such loss, damages, cost,
expense, liability or claim incurred by reason of its willful misfeasance, bad
faith, or gross negligence in the performance of its duties, or its reckless
disregard of its duties and obligations hereunder. Such indemnity shall survive
the resignation, removal or discharge of the Administrator.
6.7. Provisions of Law to Control. This Agreement shall be
subject to the applicable provisions of the Investment Company Act and the
rules and regulations of the Commission thereunder. To the extent that any
provisions herein contained conflict with any applicable provisions of the
Investment Company Act or such rules and regulations, the latter shall
control.
6.8. Counterparts. This Agreement may be signed
in counterparts with all counterparts constituting one and
the same instrument.
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IN WITNESS WHEREOF the parties have hereunto executed this
Administration Agreement as of the day and year first above written.
TRUSTEES
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Xxxxxxx X. Xxxxxx III,
as Trustee
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Xxxxx X. X'Xxxxx,
as Trustee
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Xxxxxx X. Xxxxxxx,
as Trustee
-------------
By____________________________
Name:
Title:
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