FORM OF
SUBSCRIPTION AGENT AGREEMENT
This Subscription Agent Agreement (the "Agreement") is made as of
__________________, 200_ between [INSERT NAME OF COMPANY] (the " Company"),
EquiServe, Inc., a Delaware corporation and its fully owned subsidiary EquiServe
Trust Company, N.A., a national banking (collectively, the "Agent" or
individually "EQI" and the "Trust Company", respectively). All terms not defined
herein shall have the meaning given in the prospectus (the "Prospectus")
included in the (Registration Statement on Form N-2, File No. __________ filed
by the Company with the Securities and Exchange Commission on ____________,
200__, as amended by any amendment filed with respect thereto (the "Registration
Statement").
WHEREAS, the Company proposes to make subscription offer by issuing
certificates or other evidences of subscription rights, in the form designated
by the Company (the "Subscription Certificates") to shareholders of record (the
"Shareholders") of its Common Stock, par value $_____ per share ("Common
Stock"), as of a record date specified by the Company (the "Record Date"),
pursuant to which each Shareholder will have certain rights (the "Rights") to
subscribe for shares of Common Stock, as described in and upon such terms as are
set forth in the Prospectus, a final copy of which has been or, upon
availability will promptly be, delivered to the Agent; and
WHEREAS, the Company wishes the Agent to perform certain acts on behalf
of the Company, and the Agent is willing to so act, in connection with the
distribution of the Subscription Certificates and the issuance and exercise of
the Rights to subscribe therein set forth, all upon the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
agreements set forth herein, the parties agree as follows:
1. Appointment.
The Company hereby appoints the Agent to act as subscription agent in
connection with the distribution of Subscription Certificates and the issuance
and exercise of the Rights in accordance with the terms set forth in this
Agreement and the Agent hereby accepts such appointment.
2. Form and Execution of Subscription Certificates.
A. Each Subscription Certificate shall be irrevocable [and
non-transferable]. The Agent shall, in its capacity as Transfer Agent of the
Company, maintain a register of Subscription Certificates and the holders of
record thereof (each of whom shall be deemed a "Shareholder" hereunder for
purposes of determining the rights of holders of Subscription Certificates).
Each Subscription Certificate shall, subject to the provisions thereof, entitle
the Shareholder in whose name it is recorded to the following [only if
non-transferable]:
(1) With respect to Record Date Shareholders only, the right
to acquire during the Subscription Period, as defined in the Prospectus, at the
Subscription Price, as defined in the Prospectus, a number of shares of Common
Stock equal to one share of Common Stock for every one Right (the "Primary
Subscription Right"); and
(2) With respect to Record Date Shareholders only, the right
to subscribe for additional shares of Common Stock, subject to the availability
of such shares and to the allotment of such shares as may be available among
Record Date Shareholders who exercise Over-Subscription Rights on the basis
specified in the Prospectus; provided, however, that such Record Date
Shareholder has exercised all Primary Subscription Rights issued to him or her
(the "Over-Subscription Privilege").
3. Rights and Issuance of Subscription Certificates.
A. Each Subscription Certificate shall evidence the Rights of the
Shareholder therein named to purchase Common Stock upon the terms and conditions
therein and herein set forth.
B. Upon the written advice of the Company, signed by any of its duly
authorized officers, as to the Record Date, the Agent shall, from a list of the
Company Shareholders as of the Record Date to be prepared by the Agent in its
capacity as Transfer Agent of the Company, prepare and record Subscription
Certificates in the names of the Shareholders, setting forth the number of
Rights to subscribe for the Company's Common Stock calculated on the basis of
one Right for ____ shares of Common Stock recorded on the books in the name of
each such Shareholder as of the Record Date. The number of Rights that are
issued to Record Date Shareholders will be rounded down [or pursuant to other
formula - Company should provide this information], by the Agent, to the nearest
number of Full Rights as Fractional Rights will not be issued. Each Subscription
Certificate shall be dated as of the Record Date and shall be executed manually
or by facsimile signature of a duly authorized officer of the Subscription
Agent. Upon the written advice, signed as aforesaid, as to the effective date of
the Registration Statement, the Agent shall promptly countersign and deliver the
Subscription Certificates, together with a copy of the Prospectus, instruction
letter and any other document as the Company deems necessary or appropriate, to
all Shareholders with record addresses in the United States (including its
territories and possessions and the District of Columbia). Delivery shall be by
first class mail (without registration or insurance), except for those
Shareholders having a registered address outside the United States (who will
only receive copies of the Prospectus, instruction letter and other documents as
the Company deems necessary or appropriate, if any), delivery shall be by air
mail (without registration or insurance) and by first class mail (without
registration or insurance) to those Shareholders having APO or FPO addresses. No
Subscription Certificate shall be valid for any purpose unless so executed.
C. The Agent will mail a copy of the Prospectus, instruction letter, a
special notice and other documents as the Company deems necessary or
appropriate, if any, but not Subscription Certificates to Record Date
Shareholders whose record addresses are outside the United States (including its
territories and possessions and the District of Columbia ) ("Foreign Record Date
Shareholders"). The Rights to which such Subscription Certificates relate will
be held by the Agent for such Foreign Record Date Shareholders' accounts until
instructions are received to exercise, sell or transfer the Rights.
4. Exercise.
A. Record Date Shareholders may acquire shares of Common Stock on
Primary Subscription and pursuant to the Over-Subscription Privilege by delivery
to the Agent as specified in the Prospectus of (i) the Subscription Certificate
with respect thereto, duly executed by such Shareholder in accordance with and
as provided by the terms and conditions of the Subscription Certificate,
together with (ii) the estimated purchase price, as disclosed in the Prospectus,
for each share of Common Stock subscribed for by exercise of such Rights, in
U.S. dollars by money order or check drawn on a bank in the United States, in
each case payable to the order of the Company or EQI.
B. Rights may be exercised at any time after the date of issuance of
the Subscription Certificates with respect thereto but no later than 5:00 P.M.
New York time on such date as the Company shall designate to the Agent in
writing (the "Expiration Date"). For the purpose of determining the time of the
exercise of any Rights, delivery of any material to the Agent shall be deemed to
occur when such materials are received at the Shareholder Services Division of
the Agent specified in the Prospectus.
C. Notwithstanding the provisions of Section 4 (a) and 4 (b) regarding
delivery of an executed Subscription Certificate to the Agent prior to 5:00 P.M.
New York time on the Expiration Date, if prior to such time the Agent receives a
Notice of Guaranteed Delivery by facsimile (telecopy) or otherwise from a bank,
a trust company or a New York Stock Exchange member guaranteeing delivery of (i)
payment of the full Subscription Price for the shares of Common Stock subscribed
for on Primary Subscription and any additional shares of Common Stock subscribed
for pursuant to the Over-Subscription Privilege, and (ii) a properly completed
and executed Subscription Certificate, then such exercise of Primary
Subscription Rights and Over-Subscription Rights shall be regarded as timely,
subject, however, to receipt of the duly executed Subscription Certificate and
full payment for the Common Stock by the Agent within three Business Days (as
defined below) after the Expiration Date (the "Protect Period") and full payment
for their Common Stock within ten Business Days after the Confirmation Date (as
defined in Section 4(d)). For the purposes of the Prospectus and this Agreement,
"Business Day" shall mean any day on which trading is conducted on the New York
Stock Exchange.
D. The Company will determine the Subscription Price by taking __% of
the average of the last reported sale prices of shares of Common Stock on the
New York Stock Exchange on the ______ Business Day following the Expiration Date
(the "Pricing Date") and the _____ Business Day. As soon as practicable after
the Pricing Date (the "Confirm Date"), EQI shall send to each exercising
shareholder (or, if shares of Common Stock on the Record Date are held by Cede &
Co. or any other depository or nominee, to Cede & Co. or such other depository
or nominee) a confirmation showing the number of shares of Common Stock acquired
pursuant to the Primary Subscription, and, if applicable, the Over-Subscription
Privilege, the per share and total purchase price for such shares, and any
additional amount payable to the Company by such shareholder or any excess to be
refunded by the Company to such shareholder in the form of a check and stub,
along with a letter explaining the allocation of shares of Common Stock pursuant
to the Over-Subscription Privilege.
E. Any additional payment required from a shareholder must be received
by EQI within ten Business Days after the Confirmation Date and any excess
payment to be refunded by the Company to a shareholder will be mailed by EQI
within ten Business Days after the Confirmation Date. If a shareholder does not
make timely payment of any additional amounts due in accordance with Section
4(D), EQI will consult with the Company in accordance with Section 5 as to the
appropriate action to be taken. EQI will not issue or deliver certificates or
Statements of Holding for shares subscribed for until payment in full therefore
has been received, including collection of checks and payment pursuant to
notices of guaranteed delivery.
5. Validity of Subscriptions.
Irregular subscriptions not otherwise covered by specific instructions
herein shall be submitted to an appropriate officer of the Company and handled
in accordance with his or her instructions. Such instructions will be documented
by the Agent indicating the instructing officer and the date thereof.
6. Over-Subscription.
If, after allocation of shares of Common Stock to Record Date
Shareholders, there remain unexercised Rights, then the Agent shall allot the
shares issuable upon exercise of such unexercised Rights (the "Remaining
Shares") to shareholders who have exercised all the Rights initially issued to
them and who wish to acquire more than the number of shares for which the Rights
issued to them are exercisable. Shares subscribed for pursuant to the
Over-Subscription Privilege will be allocated in the amounts of such
over-subscriptions. If the number of shares for which the Over-Subscription
Privilege has been exercised is greater than the Remaining Shares, the Agent
shall allocate the Remaining Shares to Record Date Shareholders exercising
Over-Subscription Privilege based on the number of shares of Common Stock owned
by them on the Record Date. Any remaining shares to be issued shall be allocated
to holders of Rights acquired in the secondary market based on the number of
Rights exercised by such holders of Rights. The percentage of Remaining Shares
each over-subscribing Record Date Shareholder or other Rights holder may acquire
will be rounded up or down to result in delivery of whole shares of Common
Stock. The Agent shall advise the Company immediately upon the completion of the
allocation set forth above as to the total number of shares subscribed and
distributable.
7. Delivery of Shares.
The Agent will deliver (i) certificates or Statement of Holding
reflecting new shares of Company Common Stock in the Direct Registration
System,representing those shares of Common Stock purchased pursuant to exercise
of Primary Subscription Rights as soon as practicable after the corresponding
Rights have been validly exercised and full payment for such shares has been
received and cleared and (ii) certificates or Statements of Holding representing
those shares purchased pursuant to the exercise of the Over-Subscription
Privilege as soon as practicable after the Expiration Date and after all
allocations have been effected.
8. Holding Proceeds of Rights Offering.
A. All proceeds received by EQI from Shareholders in respect of the
exercise of Rights shall be held by EQI, on behalf of the Company, in a
segregated account (the "Account"). No interest shall accrue to the Company or
shareholders on funds held in the Account pending disbursement in the manner
described in Section 4(E) above.
B. EQI shall deliver all proceeds received in respect of the exercise
of Rights to the Company as promptly as practicable, but in no event later than
ten business days after the Confirmation Date.
C. The Company acknowledges that the bank accounts maintained by EQI in
connection with the services provided under this Agreement will be in its name
and that EQI may receive investment earnings in connection with the investment
at EQI's risk and for its benefit of funds held in those accounts from time to
time.
9. Reports.
Daily, during the period commencing on __________, until termination of
the Subscription Period, the Agent will report by telephone or telecopier,
confirmed by letter, to an Officer of the Company, data regarding Rights
exercised, the total number of shares of Common Stock subscribed for, and
payments received therefor, bringing forward the figures from the previous day's
report in each case so as to show the cumulative totals and any such other
information as may be mutually determined by the Company and the Agent.
10. Loss or Mutilation.
If any Subscription Certificate is lost, stolen, mutilated or
destroyed, the Agent may, on such terms which will indemnify and protect the
Company and the Agent as the Agent may in its discretion impose (which shall, in
the case of a mutilated Subscription Certificate include the surrender and
cancellation thereof), issue a new Subscription Certificate of like denomination
in substitution for the Subscription Certificate so lost, stolen, mutilated or
destroyed.
11. Compensation for Services.
The Company agrees to pay to the Agent compensation for its services
hereunder in accordance with its Fee Schedule to act as Agent attached hereto as
Exhibit A. The Company further agrees that it will reimburse the Agent for its
reasonable out-of-pocket expenses incurred in the performance of its duties as
such.
12. Instructions, Indemnification and Limitation of Liability.
The Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions:
A. The Agent shall be entitled to rely upon any instructions or
directions furnished to it by an appropriate officer of the Company, whether in
conformity with the provisions of this Agreement or constituting a modification
hereof or a supplement hereto. Without limiting the generality of the foregoing
or any other provision of this Agreement, the Agent, in connection with its
duties hereunder, shall not be under any duty or obligation to inquire into the
validity or invalidity or authority or lack thereof of any instruction or
direction from an officer of the Company which conforms to the applicable
requirements of this Agreement and which the Agent reasonably believes to be
genuine and shall not be liable for any delays, errors or loss of data occurring
by reason of circumstances beyond the Agent's control.
B. The Company will indemnify the Agent and its nominees against, and
hold it harmless from, all liability and expense which may arise out of or in
connection with the services described in this Agreement or the instructions or
directions furnished to the Agent relating to this Agreement by an appropriate
officer of the Company, except for any liability or expense which shall arise
out of the gross negligence, bad faith or willful misconduct of the Agent or
such nominees.
Promptly after the receipt by the Agent of notice of any demand or
claim or the commencement of any action, suit, proceeding or investigation, the
Agent shall, if a claim in respect thereof is to be made against the Company,
notify the Company thereof in writing. The Company shall be entitled to
participate as its own expense in the defense of any such claim or proceeding,
and, if it so elects at any time after receipt of such notice, it may assume the
defense of any suit brought to enforce any such claim or of any other legal
action or proceeding. For the purposes of this Section 12, the term "expense or
loss" means any amount paid or payable to satisfy any claim, demand, action,
suit or proceeding settled with the express written consent of the Agent, and
all reasonable costs and expenses, including, but not limited to, reasonable
counsel fees and disbursements, paid or incurred in investigating or defending
against any such claim, demand, action, suit, proceeding or investigation.
C. The Agent shall be responsible for and shall indemnify and hold the
Company harmless from and against any and all losses, damages, costs, charges,
counsel fees, payments, expenses and liability arising out of or attributable to
Agent's refusal or failure to comply with the terms of this Agreement, or which
arise out of Agent's negligence or willful misconduct or which arise out of the
breach of any representation or warranty of Agent hereunder, for which Agent is
not entitled to indemnification under this Agreement; provided, however, that
Agent's aggregate liability during any term of this Agreement with respect to,
arising from, or arising in connection with this Agreement, or from all services
provided or omitted to be provided under this Agreement, whether in contract, or
in tort, or otherwise, is limited to, and shall not exceed, the amounts paid
hereunder by the Company to Agent as fees and charges, but not including
reimbursable expenses, during the six (6) calendar months immediately preceding
the event for which recovery from the Agent is being sought.
13. Changes in Subscription Certificate.
The Agent may, without the consent or concurrence of the Shareholders
in whose names Subscription Certificates are registered, by supplemental
agreement or otherwise, concur with the Company in making any changes or
corrections in a Subscription Certificate that it shall have been advised by
counsel (who may be counsel for the Company) is appropriate to cure any
ambiguity or to correct any defective or inconsistent provision or clerical
omission or mistake or manifest error therein or herein contained, and which
shall not be inconsistent with the provision of the Subscription Certificate
except insofar as any such change may confer additional rights upon the
Shareholders.
14. Assignment/Delegation.
A. Except as provided in Section 14(B) below, neither this Agreement
nor any rights or obligations hereunder may be assigned or delegated by either
party without the written consent of the other party.
B. The Agent may, without further consent on the part of the Company,
subcontract with other subcontractors for systems, processing, telephone and
mailing services, and post-exchange activities, as may be required from time to
time; provided, however, that the Agent shall be as fully responsible to the
Company for the acts and omissions of any subcontractor as it is for its own
acts and omissions.
C. Except as explicitly stated elsewhere in this Agreement, nothing
under this Agreement shall be construed to give any rights or benefits in this
Agreement to anyone other than the Agent and the Company and the duties and
responsibilities undertaken pursuant to this Agreement shall be for the sole and
exclusive benefit of the Agent and the Company.
15. Governing Law.
The validity, interpretation and performance of this Agreement shall be
governed by the law of the Commonwealth of Massachusetts and shall inure to the
benefit of and the obligations created hereby shall be binding upon the
successors and permitted assigns of the parties hereto.
16. Third Party Beneficiaries.
This Agreement does not constitute an agreement for a partnership or
joint venture between the Agent and the Company. Neither party shall make any
commitments with third parties that are binding on the other party without the
other party's prior written consent.
17. Force Majeure.
In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, terrorist acts,
equipment or transmission failure or damage reasonably beyond its control, or
other cause reasonably beyond its control, such party shall not be liabile for
damages to the other for any damages resulting from such failure to perform or
otherwise from such causes. Performance under this Agreement shall resume when
the affected party or parties are able to perform substantially that party's
duties.
18. Consequential Damages.
Neither party to this Agreement shall be liable to the other party for
any consequential, indirect, special or incidental damages under any provisions
of this Agreement or for any consequential, indirect, penal, special or
incidential damages arising out of any act or failure to act hereunder even if
that party has been advised of or has foreseen the possibility of such damages.
19. Severability.
If any provision of this Agreement shall be held invalid, unlawful, or
unenforceable, the valididty, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired.
20. Counterparts.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original and all of which together shall be considered
one and the same agreement.
21. Captions.
The captions and descriptive headings herein are for the convenience of
the parties only. They do not in any way modify, amplify, alter or give full
notice of the provisions hereof.
22. Confidentiality.
The Agent and the Company agree that all books, records, informtion and
data pertaining to the business of the other party which are exchanged or
received pursuant to the negotiation or the carrying out of this Agreement
including the fees for services set forth in the attached schedule shall remain
confidential, and shall not be voluntarily disclosed to any other person, except
as may be required by law.
23. Term and Termination.
This Agreement shall remain in effect until the earlier of (a) thirty
(30) days after the Expiration Date; (b) it is terminated by either party upon a
material breach of this Agreement which remains uncured for 30 days after
written notice of such breach has been provided; or (c) 30 days' written notice
has been provided by either party to the other. [If not transfer agent for the
Company add: Upon termination of this Agreement, all canceled Certificates and
related documentation will be returned to the Company or agent designated by the
Company.] [If transfer agent add: Upon termination of the Agreement, the Agent
shall retain all canceled Certificates and related documentation as required by
applicable law.]
24. Notices.
Until further notice in writing by either party hereto to the other
party, all
written reports, notices and other communications between the Exchange Agent and
the Company required or permitted hereunder shall be delivered or mailed by
first class mail, postage prepaid, telecopier or overnight courier guaranteeing
next day delivery,addressed as follows:
If to the Company, to:
If to the Agent, to:
EquiServe Trust Company, N.A.
c/o EquiServe, Inc.
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Reorganization Department
or
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxx Xxxx, XX 00000
Attn: Reorganization Department
25. Survival.
The provisions of Paragraphs 12, 15, 17-19, 22, and 24-26 shall survive
any termination, for any reason, of this Agreement.
26. Merger of Agreement.
This Agreement constitutes the entire agreement between the parties
hereto and supercedes any prior agreement with respet to the subject matter
hereof whether oral or written.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers, hereunto duly authorized, as of the day
and year first above written.
EQUISERVE TRUST COMPANY, NA. COMPANY
By:______________________________ By:_______________________
Date:____________________________ Date:______________________
Title:____________________________ Title:______________________
EQUISERVE, INC.
By:______________________________
Date:_____________________________
Title:_____________________________
