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FUND EXPENSE AGREEMENT
Agreement dated as of November [__], 1995 between Xxxxxx
Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx") and The Bank of New York (the
"Service Provider"), in its capacities as administrator, custodian and paying
agent [and collateral agent] for AJL PEPS Trust (the "Trust").
WHEREAS the Trust is a trust formed under the laws of the State
of New York pursuant to a Trust Agreement dated as of August 17, 1995, as
amended and restated as of November [__], 1995 (the "Trust Agreement"); and
WHEREAS, Xxxxxx Xxxxxxx, as sponsor under the Trust Agreement,
desires to make provision for the payment of certain initial and on-going
expenses of the Trust;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained in this Agreement, the parties agree as follows:
1. Definitions. (a) Capitalized terms used herein and not
defined herein shall have the meanings ascribed thereto in the Trust Agreement.
(b) The following terms shall have the following meanings:
"Additional Expense" means the Ordinary Expense the incurring
of which will require the Service Provider to provide the Additional Expense
Notice pursuant to Section 3(a) hereof and any Ordinary Expense incurred
thereafter.
"Additional Expense Notice" means the notice required to be
given by the Service Provider to Xxxxxx Xxxxxxx pursuant to Section 3(a)(i)
hereof.
"Closing Date" shall have the meaning ascribed thereto in the
Underwriting Agreement.
"Ordinary Expense" of the Trust means any expense of the Trust
other than any expense of the Trust arising under Section 6.6 of the
Administration Agreement, Section 15 of the Custodian Agreement, Section 5.4(b)
of the Paying Agent Agreement and Section 7.6 of the Trust Agreement [and
Section [__] of the Collateral Agreement].
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"Up-front Fee Amount" means the amount set forth as such on
Schedule I hereto payable as a one-time payment to the Service Provider in
respect of its collective services as Administrator, Custodian and Paying Agent
[and Collateral Agent] for the entire term of the Trust.
"Up-front Expense Amount" means the amount set forth as such on
Schedule I hereto payable as a one-time payment to the Service Provider in
respect of Ordinary Expenses anticipated to be incurred by the Administrator on
behalf of the Trust, pursuant to the Administration Agreement, during the term
of the Trust.
2. Agreement to Pay Up-front Fees and Expenses. Xxxxxx Xxxxxxx
agrees to pay to the Service Provider in New York Clearing House funds on the
Closing Date (as defined in the Underwriting Agreement) the Up-front Fee Amount
and the Up-front Expense Amount.
3. Agreement to Pay Additional Expenses. (a) Prior to
incurring any Ordinary Expense on behalf of the Trust that, together with all
prior ordinary expenses incurred by the Administrator on behalf of the Trust,
would cause the aggregate amount of Ordinary Expenses of the Trust to exceed the
Up-front Expense Amount, the Administrator shall provide to Xxxxxx Xxxxxxx (i)
prompt written notice to the effect that aggregate amount of Ordinary Expenses
of the Trust will exceed the Up-front Expense Amount, and (ii) an accounting, in
such detail as shall be reasonably acceptable to Xxxxxx Xxxxxxx, of all Ordinary
Expenses incurred on behalf of the Trust through the date of the Additional
Expense Notice.
(b) From and after the date of the Additional Expense Notice,
the Service Provider agrees that it will not, without the prior written consent
of Xxxxxx Xxxxxxx, incur on behalf of the Trust (i) any single expense in excess
of $[______] or (ii) in any calendar [period], expenses aggregating in excess of
$[_______]. Subject to the foregoing, the Service Provider shall give notice to
Xxxxxx Xxxxxxx in writing promptly following the incurring of any Additional
Expense. Such notice shall be accompanied by any demand, xxxx, invoice or other
similar document in respect of such Additional Expense.
(c) Subject to the first sentence of paragraph (b) of this
Section 3, Xxxxxx Xxxxxxx agrees to pay to the Service Provider from time to
time the amount of any Additional Expense. Payment by Xxxxxx Xxxxxxx of any
Additional Expense shall be made in New York Clearing House funds by the later
of (i) five Business Days after the
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receipt by Xxxxxx Xxxxxxx of written notice from the Service Provider of the
incurring thereof or (ii) the due date for the payment of such Additional
Expense .
(d) Xxxxxx Xxxxxxx may contest in good faith the reasonableness
of any Additional Expense and the parties shall attempt to resolve amicably the
disagreement; provided that if the parties cannot resolve the dispute by
the due date hereunder with respect to such Additional Expense, subject to the
first sentence of paragraph (b) of this Section 3, Xxxxxx Xxxxxxx shall pay the
amount of such Additional Expense subject to later adjustment and credit if such
dispute is resolved in favor of Xxxxxx Xxxxxxx.
4. Condition to Payment. Xxxxxx Xxxxxxx'x obligations
under paragraphs 2 and 3 hereof shall be subject to the condition that the
Trust's [____] Premium Exchangeable Participating Shares shall have been issued
and paid for on the Closing Date.
5. Trust Termination; Refund of Unused Expense Funds.
If at the termination of the Trust in accordance with Section 8.3 of the Trust
Agreement the aggregate amount of Ordinary Expenses incurred by the Service
Provider on behalf of the Trust through the date of termination shall be less
than the Up-front Expense Amount, the Service Provider shall, promptly following
the date of such termination, pay to Xxxxxx Xxxxxxx in New York Clearing House
funds the amount of such excess.
6. Termination of Administration Agreement. In the
event of the termination of the Administration Agreement in accordance with
Section 4.1 thereof, the Service Provider shall promptly pay to Xxxxxx Xxxxxxx
the portion of its Up-front Fee Amount ratable for the period from the date of
the termination of the Administration Agreement to the Exchange Date together
with any unexpended portion of the Up-front Expense Amount.
7. Statements and Reports. The Service Provider shall
collect and safekeep all demands, bills, invoices or other written
communications received from third parties in connection with any Ordinary
Expenses and shall prepare and maintain adequate books and records showing all
receipts and disbursements of funds in connection therewith. Xxxxxx Xxxxxxx
shall have the right to inspect and to copy, at its expense, all such documents,
books and records at all reasonable times and from time to time during the term
of this Agreement.
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8. Term of Contract. This Agreement shall continue in effect
until the termination of the Trust in accordance with Section 8.3 of the Trust
Agreement.
9. No Assignment. No party to this Agreement may assign its
rights or delegate its duties hereunder without the prior written consent of the
other party.
10. The Service Provider agrees that it will not consent to any
amendment to any of the Administration Agreement, the Custodian Agreement or the
Paying Agent Agreement [or the Collateral Agreement] without the prior written
consent of Xxxxxx Xxxxxxx.
11. Entire Agreement. This Agreement contains the
entire agreement among the parties with respect to the matters contained herein
and supersedes all prior agreements or understandings. No amendment or
modification of this Agreement shall be valid unless the amendment or
modification is in writing and is signed by all the parties to this Agreement.
12. Notices. All notices, demands, reports, statements,
approvals or consents given by any party under this Agreement shall be in
writing and shall be delivered in person or by telecopy or other facsimile
communication or sent by first-class U.S. mail, registered or certified, postage
prepaid, to the appropriate party at its address on the signature pages hereof
or at such other address subsequently notified to the other parties hereto. Any
party may change its address for purposes hereof by delivering a written notice
of the change to the other parties. All notices given under this Agreement shall
be deemed received (a) in the case of hand delivery, on the day of delivery, (b)
in the case of telecopy or other facsimile communication, on the day of
transmission, and (c) in the case of mailing, on the third day after such notice
was deposited in the mail.
13. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
14. Governing Law. This Agreement shall be governed by and be
construed in accordance with the laws of the State of New York.
15. Counterparts. This Agreement may be signed in counterpart
with all of such counterparts constituting one and the same instrument.
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IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed by their authorized representatives the date first above written.
XXXXXX XXXXXXX & CO.
INCORPORATED
By
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Address:
0000 Xxxxxxxx
Xxx Xxxx, XX00000
THE BANK OF NEW YORK
By
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Address:
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
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