Exhibit (2)(d)(6)
Shareholder
-----------
Communications Corporation
OFFERING COORDINATOR/INFORMATION AGENT AGREEMENT
------------------------------------------------
This document will constitute the agreement between XXXXXX XXXXXXX XXXX
XXXXXX HIGH YIELD FUND, INC. ("the FUND"), with its principal executive offices
at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000 and SHAREHOLDER
COMMUNICATIONS CORPORATION ("SCC"), with its principal executive offices at 00
Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, relating to a rights offering (the "OFFER")of
the Fund.
The services to be provided by SCC will be as follows:
1. OFFERING COORDINATOR
--------------------
As the "offering coordinator", SCC will provide several services to
the FUND in connection with the OFFER, which will include without
limitation:
A. Coordinating and maintaining contact with those registered
broker/dealers who will directly solicit those shareholders who
are their customers and serve as the intermediary between the
issuer and each such broker/dealer.
B. Distributing relevant offering materials, including prospectuses
and solicitation agreements, to all reorganization departments of
such broker/dealers.
C. Offering input as to the feasibility of the OFFER's general
structure including pricing, market timing, transferability,
oversubscription allotments, offering extensions and solicitation
payouts.
D. Assisting in drafting all documents including letters to
shareholders, warning letters, exercise forms, solicitation
agreements and any broker related soliciting summaries for
marketing the OFFER.
E. Providing extensive reporting beginning one week prior to
expiration or any extensions thereafter, which will measure
shareholder participation and the OFFER's general progress. This
reporting will be based solely on previously established contacts
with the reorganization departments of participating
broker/dealers. Other gauges of interest will be provided on a
periodic basis throughout the duration of the OFFER.
II. INFORMATION AGENT
-----------------
A. INDIVIDUAL HOLDERS OF RECORD AND BENEFICIAL OWNERS
--------------------------------------------------
1. Target Group - SCC estimates that it will call between
------------
2,890 and 4,200 of the approximately 7,500 outstanding
beneficial and record shareholders of the FUND. The estimate
number is subject to adjustment and SCC will call more or
less shareholders if directed by the Fund or Xxxxxx Xxxxxxx
Xxxx Xxxxxx Investment Management Inc., the FUND's
investment manager (the
Shareholder
-----------
Communications Corporation
"INVESTMENT MANAGER"), and will call more shareholders if SCC determines
that such additional calls are necessary based on the response to the
OFFER.
2. Telephone Number Lookups. SCC will obtain the needed telephone
-----------------------
numbers from various types of telephone directories.
3. Initial Telephone Calls to Provide Information. SCC will begin
----------------------------------------------
telephone calls to the target group as soon as practical but no later
than 14 days after the commencement of the OFFER. Most calls will be
made during 10:00 A.M. to 9:00 P.M. on business days and only during
10:00 A.M. to 5:00 P.M. on Saturdays. No calls will be received by any
----------------------------
shareholder after 9:00 P.M. on any day, in any time zone, unless
------------------------------ ------- -----------------
specifically requested by the shareholder. SCC will maintain "800"
-----------------------------------------
lines for shareholders to call with questions about the OFFER. The "800"
lines will be staffed Monday through Friday between 9:00 a.m. and 9:00
p.m.
4. Re-mails. SCC will coordinate re-mails of offering materials to the
--------
shareholders who advise us that they have discarded or misplaced the
originally mailed materials
5. Reminder/Extension Mailing. SCC will coordinate any remainder mailing
--------------------------
at the request of the FUND or the INVESTMENT MANAGER. SCC will only mail
materials supplied by the FUND or the INVESTMENT MANAGER, or if drafted
by SCC or another party, approved by the FUND or the INVESTMENT MANAGER
in advance in writing.
B. BANK/BROKER SERVICING
---------------------
SCC will contact all banks, brokers and other nominee shareholders
("intermediaries") holding stock, as shown on appropriate portions of
the shareholder lists to ascertain quantities of offering materials
needed for forwarding to beneficial owners.
SCC will deliver offering materials by messenger to New York City based
intermediaries and by Federal Express or other means to non-New York
City based intermediaries. SCC will also follow-up by telephone with
each intermediary to ensure receipt of the offering materials and to
confirm timely re-mailing of materials to the beneficial owners.
SCC will maintain frequent contact with intermediaries to monitor
shareholder response and to ensure that all liaison procedures are
proceeding satisfactorily.
SCC will, daily or more frequently as practicable, report to the Fund as
to the response from intermediaries with respect to the OFFER.
Shareholder
-----------
Communications Corporation
III. PROJECT FEES
------------
In consideration for acting as Offering Coordinator, SCC will receive a
flat project fee of $85,000 which is not tied in any way to the
performance of the OFFER, except in the case where the negligence, willful
misconduct, bad faith or reckless disregard on the part of SCC impacts the
performance of the OFFER. In consideration for acting as Information
Agent, SCC will receive a project fee of $15,000. The fees are payable by
the FUND as set forth in Section VII of this agreement.
IV. ESTIMATED EXPENSES
------------------
SCC will be reimbursed by the FUND for its reasonable out-of-pocket
expenses incurred provided that SCC submits to the FUND an expense report,
itemizing such expenses and providing copies of all supporting bills in
respect of such expenses.
SCC's expenses are estimated as set forth below and the estimates are
based largely on data provided to SCC by the FUND. In the course of the
OFFER, the expenses and expense categories may change due to changes in
the OFFER schedule or due to events beyond SCC's control, such as delays
in receiving offering materials and related items. In the event of
significant change or new expenses not originally contemplated, SCC will
notify the FUND by phone and/or by letter for approval of such expenses.
ESTIMATED EXPENSES Low Range High Range
------------------ --------- ----------
Data Handling and Preparation
Telephone # Lookup - Account Consolidation,
Computer Match and Information Operators (blended rate)
5,250 @ $.60........................................................... $ 3,150 $ 3,150
Inbound/Outbound Information Campaign
Outbound Telephone Calls
2,890 to 4,200 @ $3.75 (registered & NOBO holders)..................... 10,837 15,750
720 to 1,260 @ $4.00 (Reorganization Calls)............................ 2,880 5,040
Inbound "800" Telephone Calls
(Shareholders, Banks, Brokers and Financial Advisors)
650 to 825 @ $3.75..................................................... 2,437 3,093
Mailing & Distribution
Bank/Broker Distribution (freight, messenger and FedEx)................ 3,500 6,000
Miscellaneous expenses - FedEx,
postage, search and related items...................................... 750 1,500
-------- --------
TOTAL ESTIMATED EXPENSES.......................................... $ 23,554 $ 34,533
Shareholder
-----------
Communications Corporation
V. PERFORMANCE
-----------
SCC will use its best efforts to achieve the goals of the OFFER but SCC
is not guaranteeing a minimum success rate.
SCC's strategies revolve around a telephone and mail information
campaign. The purpose of the telephone and mail information campaign is
to raise the overall awareness among shareholders of the OFFER and help
shareholders better understand the transaction. This in turn may result
in a higher overall response.
VI. COMPLIANCE
----------
SCC will be responsible for compliance with all applicable rules and
regulations of the Securities and Exchange Commission, National
Association of Securities Dealers or any other applicable federal or
state agencies.
In rendering the services contemplated by this Agreement, SCC agrees not
to make any written representations to any shareholders or prospective
shareholders of the FUND or any broker/dealer, or to make any oral
representations to any such person, that are not contained in the FUND's
Prospectus, unless previously authorized to do so in writing by the
FUND.
Further, in the role of "offering coordinator", SCC will not undertake
any broker/dealer activities including, but not limited to, executing
securities transactions, soliciting shareholders to exercise rights, or
offer advice to shareholders regarding their decisions to exercise or
reject rights.
VII. PAYMENT
-------
Payment for one half the project fees ($50,000) will be made at the
signing of this contract. The Fund will pay the balance of project fees
and will reimburse SCC for its reasonable out-of-pocket expenses in
connection with the OFFER, as set forth in Section IV of this agreement,
within thirty days after SCC sends its final invoice in connection with
the OFFER to the FUND.
VIII. MISCELLANEOUS
-------------
SCC agrees to preserve the confidentiality of all non-public information
provided by the FUND, the INVESTMENT MANAGER, or any of their agents, or
from broker/dealers or the Fund's stockholders, for use in providing
services under this Agreement and in connection with the OFFER
generally, or information developed by SCC based upon such non-public
information.
Shareholder
-----------
Communications Corporation
In the event the project is cancelled for an indefinite period of time after
the signing of this contract and before the expiration of the OFFER, SCC will
be reimbursed by the FUND for its reasonable out-of-pocket expenses incurred
in connection with the OFFER and a pro rata portion of the project fees as
calculated based upon the number of days lapsed from the signing of this
agreement through the expiration of the OFFER, currently scheduled for
September 24, 1999. To the extent that the pro rata cancellation fees are
less than $50,000 paid at the signing of this contract, pursuant to section
VII of this Agreement, SCC will reimburse the Fund the difference between the
$50,000 and the pro rata cancellation fees.
The FUND agrees to indemnify, hold harmless, reimburse and defend SCC, and
its officers, agents and employees, against all claims or threatened claims,
costs, expenses, liabilities, obligations, losses or damages (including
reasonable legal fees and expenses) of any nature, incurred by or imposed
upon SCC, or any of its officers, agents or employees, which results, arises
out of or is based upon services rendered to the FUND in accordance with the
provisions of to this AGREEMENT, provided that such services are rendered to
the FUND without any negligence, willful misconduct, bad faith or reckless
disregard on the part of SCC, or its officers, agents or employees. SCC
agrees to advise the FUND of any claim or liability promptly after receipt of
any notice thereof. The FUND shall not be liable for any settlement without
its written consent. At its election, the FUND may assume the defense of any
such action.
SCC agrees to indemnify, hold harmless, reimburse and defend the FUND and its
officers, agents, and employees, against all claims or threatened claims,
costs, liabilities, obligations, losses or damages (including reasonable
legal fees and expenses) of any nature, incurred by or imposed upon the Fund
or any of its officers, agents or employees which results, arises out of or
is based upon services rendered to the Fund by SCC provided that such
services are rendered to the Fund with negligence, willful misconduct, bad
faith or reckless disregard on the part of SCC or its officers, agents or
employees.
This agreement will be governed by and construed in accordance with the laws
of the State of New York. This AGREEMENT sets forth the entire AGREEMENT
between SCC and the FUND with respect to the agreement herein and cannot be
modified except in writing by both parties.
IN WITNESS WHEREOF, the parties have signed this AGREEMENT this 23rd day of
August 1999.
XXXXXX XXXXXXX XXXX XXXXXX SHAREHOLDER COMMUNICATIONS
HIGH YIELD FUND, INC. CORPORATION
By /s/ Xxxxxxx X. Xxxxx By /s/ Xxxxxx X. Xxxxxxx
------------------------------- --------------------------------
Xxxxxxx X. Xxxxx Xxxxxx X. Xxxxxxx
President Senior Vice President
