EXHIBIT (k)(iv)
ADDITIONAL COMPENSATION AGREEMENT
September 28, 2004
Deutsche Investment Management Americas Inc.
00 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Reference is made to the Purchase Agreement dated September 23, 2004 (the
"Purchase Agreement"), by and among Xxxxxxx Global Commodities Stock Fund, Inc.,
a closed-end management investment company (the "Fund"), Deutsche Investment
Management Americas Inc. ("DeIM" or the "Investment Adviser") and each of the
respective Underwriters named therein, with respect to the issue and sale of the
Fund's shares of common stock, par value $0.01 per share (the "Common Shares"),
as described therein. Reference is also made to (i) the Investment Management
Agreement, dated [ ], 2004 (the "Investment Management Agreement") between
DeIM and the Fund and (ii) the registration statement on Form N-2 regarding the
Common Shares of the Fund (the "Registration Statement"). Capitalized terms used
herein and not otherwise defined shall have the meanings given to them in the
Purchase Agreement.
DeIM hereby confirms its agreement with each Qualifying Underwriter (as
defined in Section 1 hereof) with respect to the additional compensation
referred to in the "Underwriting" section of the Registration Statement, payable
by DeIM to each of the Qualifying Underwriters. DeIM agrees to pay to each
Qualifying Underwriter additional compensation (collectively, the "Additional
Compensation") as provided for in Section 3 hereof; provided, however, that such
Additional Compensation shall not exceed an amount equal to 0.15% of the Fund's
average daily total managed assets (i.e., the net asset value of Common Shares
plus the liquidation preference of any Fund preferred stock plus the principal
amount of any borrowings) (the "Managed Assets") attributable to the Common
Shares sold by UBS Securities LLC in the offering; and provided, further, that
such payments shall not exceed the "Maximum Additional Compensation Amount" (as
defined in Section 4 hereof). The Additional Compensation shall be payable as
set forth in Section 3 hereof.
SECTION 1. Qualifying Underwriters.
(a) For the purposes of this Additional Compensation Agreement, UBS
Securities LLC shall be a "Qualifying Underwriter." Within 60 days following the
Closing Date, the Qualifying Underwriters shall prepare or cause to be prepared
and provide to DeIM a chart listing each of the Qualifying Underwriters, which
chart shall indicate the aggregate purchase price to the public of the Common
Shares sold by each Qualifying Underwriter and the Pro Rata Percentage (as
defined in Section 2 hereof) of each Qualifying Underwriter and shall be
appended as Schedule A to this Additional Compensation Agreement. Such Schedule
A shall be prepared in good faith by the Qualifying Underwriters and subject to
verification by DeIM.
(b) DeIM hereby employs the Qualifying Underwriters, for the period and on
the terms and conditions set forth herein, to provide the following services at
the reasonable request of DeIM:
(i) after-market support services designed to maintain the
visibility of the Fund on an ongoing basis;
(ii) relevant information, studies or reports regarding general
trends in the closed-end investment company and asset management industries, if
reasonably obtainable, and consult with representatives of DeIM in connection
therewith; and
(iii) information to and consult with DeIM with respect to
applicable strategies designed to address market value discounts, if any, with
respect to the Fund.
SECTION 2. Pro Rata Percentage. Each Qualifying Underwriter shall be
assigned a "Pro Rata Percentage," the numerator of which shall equal the
aggregate purchase price to the public of the Common Shares sold by such
Underwriter as set forth on Schedule A hereto and the denominator of which shall
equal the aggregate purchase price to the public of all of the Common Shares
purchased by the Underwriters pursuant to the Purchase Agreement.
SECTION 3. Payment of Additional Compensation.
(a) DeIM shall pay the Additional Compensation, quarterly in arrears, to
each Qualifying Underwriter in an amount equal to the product of such Qualifying
Underwriter's Pro Rata Percentage multiplied by 0.0375% of the Managed Assets of
the Fund for such quarter.
(b) All fees payable hereunder shall be paid to each Qualifying
Underwriter by wire transfer of immediately available funds within 15 days
following the end of each calendar quarter to a bank account designated by such
Qualifying Underwriter. At the time of each payment of Additional Compensation
hereunder, DeIM shall deliver to each Qualifying Underwriter receiving an
installment of Additional Compensation a statement indicating the amount of the
of the aggregate average daily gross asset value of the Fund for such quarter
(including assets attributable to any preferred shares of the Fund that may be
outstanding) on which such payment was based.
(c) The initial payments of Additional Compensation hereunder shall be
paid with respect to the calendar quarter ending December 31, 2004. In the event
that this Additional Compensation Agreement terminates prior to the end of a
calendar quarter, the Additional Compensation required to be paid hereunder
shall be due and payable within 15 days following the termination hereof and
shall be pro-rated in respect of the period prior to such termination.
Notwithstanding the foregoing, if any payment hereunder would otherwise fall on
a day which is not a business day, it shall be due on the next day which is a
business day. All fees payable hereunder shall be in addition to any fees paid
by the Investment Adviser pursuant to the Purchase Agreement.
SECTION 4. Maximum Additional Compensation Amount. The "Maximum Additional
Compensation Amount" payable by the Investment Adviser hereunder shall be [ ]%
of the aggregate offering price of the Common Shares. Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated will receive additional compensation which will not
exceed [ ]% of the aggregate initial offering price of the Common Shares, and
X.X. Xxxxxxx & Sons, Inc. will received additional compensation which will not
exceed [ ]% of the aggregate initial offering price of the Common Shares.
SECTION 5. Term. This Additional Compensation Agreement shall continue
coterminously with and so long as the Investment Management Agreement, dated [
], 2004, remains in effect between the Fund and DeIM, or any similar investment
management agreement with a successor in interest or affiliate of DeIM remains
in effect, as and to the extent that such investment management agreement is
renewed periodically in accordance with the Investment Company Act of 1940, as
amended. This Additional Compensation Agreement shall terminate on the earliest
to occur of (a) with respect to any Qualifying Underwriter, the payment by DeIM
to such Qualifying Underwriter of the Maximum Additional Compensation Amount,
(b) with respect to the Fund, the dissolution and winding up of the
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Fund and (c) with respect to DeIM, the date on which the Investment Management
Agreement or other investment management agreement between the Fund and DeIM or
any successor in interest to DeIM, including but not limited to an affiliate of
DeIM, shall terminate.
SECTION 6. Not an Investment Adviser. DeIM acknowledges that the
Underwriters are not providing any advice hereunder as to the value of
securities or regarding the advisability of purchasing or selling any securities
for the Fund. No provision of this Additional Compensation Agreement shall be
considered as creating, nor shall any provision create, any obligation on the
part of any Underwriter, and the Underwriters are not hereby agreeing, to: (i)
furnish any advice or make any recommendations regarding the purchase or sale of
portfolio securities or (ii) render any opinions, valuations or recommendations
of any kind or to perform any such similar services.
SECTION 7. Not Exclusive. Nothing herein shall be construed as prohibiting
any Underwriter or its respective affiliates from acting as such for any other
clients (including other registered investment companies or other investment
advisers).
SECTION 8. No Liability. DeIM agrees that no Underwriter shall have
liability to DeIM or the Fund for any act or omission to act by such Underwriter
in the course of its performance under this Additional Compensation Agreement,
in the absence of gross negligence or willful misconduct on the part of such
Underwriter. DeIM agrees to indemnify and hold harmless each Underwriter and its
respective officers, directors, agents and employees against any loss or expense
arising out of or in connection with such Underwriter's performance under this
Additional Compensation Agreement. This provision shall survive the termination,
expiration or supersession of this Additional Compensation Agreement.
SECTION 9. Assignment. This Additional Compensation Agreement may not be
assigned by any party without the prior written consent of each other party.
SECTION 10. Amendment; Waiver. No provision of this Additional
Compensation Agreement may be amended or waived except by an instrument in
writing signed by the parties hereto.
SECTION 11. Governing Law. This Additional Compensation Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York.
SECTION 12. Counterparts. This Additional Compensation Agreement may be
executed in any number of counterparts, each of which shall be an original, and
all of which, when taken together, shall constitute one agreement. Delivery of
an executed signature page of this Additional Compensation Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
DeIM and the Qualifying Underwriters in accordance with its terms.
Very truly yours,
UBS SECURITIES LLC
By: ___________________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
DEUTSCHE INVESTMENT MANAGEMENT AMERICAS INC.
By: _____________________________
Name:
Title:
SCHEDULE A
AGGREGATE
NAME OF QUALIFYING PURCHASE PRICE TO PUBLIC PRO RATA
UNDERWRITER OF COMMON SHARES SOLD PERCENTAGE
----------- --------------------- ----------
UBS Securities LLC $[ ]
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UBS SECURITIES LLC INDEMNIFICATION AGREEMENT
September 28, 2004
UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
In connection with the engagement of UBS Securities LLC ("UBS Securities")
to provide the Services to the undersigned (the "Company") with the matters set
forth in the Additional Compensation Agreement dated September 28, 2004 between
the Company and UBS Securities (the "Agreement"), in the event that UBS
Securities becomes involved in any capacity in any claim, suit, action,
proceeding, investigation or inquiry (including, without limitation, any
shareholder or derivative action or arbitration proceeding) (collectively, a
"Proceeding") (i) in connection with or arising out of any untrue statement or
alleged untrue statement of a material fact contained in information with
respect to the Fund or any omission or alleged omission to state therein a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading or (ii) otherwise in
connection with or arising out of the Agreement or the Services to be provided
thereunder, the Company agrees to indemnify, defend and hold UBS Securities
harmless to the fullest extent permitted by law, from and against any losses,
claims, damages, liabilities and expenses in connection with or arising out of
the Agreement or the Services to be provided thereunder (a "Covered Claim"),
except, in the case of clause (ii) above only, to the extent that it shall be
determined by a court of competent jurisdiction in a judgment that has become
final in that it is no longer subject to appeal or other review, that such
losses, claims, damages, liabilities and expenses resulted solely from the gross
negligence, bad faith or willful misconduct of UBS Securities. In addition, in
the event that UBS Securities becomes involved in any capacity in any Proceeding
which relates to a Covered Claim, the Company will reimburse UBS Securities for
its legal and other expenses (including the reasonable cost of any investigation
and preparation) as such expenses are incurred by UBS Securities in connection
therewith. If such indemnification were not to be available for any reason, the
Company agrees to contribute to the losses, claims, damages, liabilities and
expenses involved (i) in the proportion appropriate to reflect the relative
benefits received or sought to be received by the Company and its stockholders,
on the one hand, and UBS Securities, on the other hand, in the matters
contemplated by the Agreement or (ii) if (but only if and to the extent) the
allocation provided for in clause (i) is for any reason held unenforceable, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) but also the relative fault of the Company and its
stockholders, on the one hand, and the party entitled to contribution, on the
other hand, as well as any other relevant equitable considerations; provided,
that in no event shall the Company contribute less than the amount necessary to
assure that UBS Securities is not liable for losses, claims, damages,
liabilities and expenses in excess of the amount of fees actually received by
UBS Securities pursuant to the Agreement. Relative fault shall be determined by
reference to, among other things, whether any alleged untrue statement or
omission or any other alleged conduct relates to information provided by the
Company or other conduct by the Company (or its employees or other agents), on
the one hand, or by UBS Securities, on the other hand. The Company will not
settle any Proceeding in respect of which indemnity may be sought hereunder,
whether or not UBS Securities is an actual or potential party to such
Proceeding, without UBS Securities's prior written consent. For purposes of this
Indemnification Agreement, UBS Securities shall include UBS Securities LLC, any
of its affiliates, each other person, if any, controlling UBS Securities or any
of its affiliates, their respective officers, current and former directors,
employees and agents, and the successors and assigns of all of the foregoing
persons. The foregoing indemnity and contribution agreement shall be in addition
to any rights that any indemnified party may have at common law or otherwise.
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If any Proceeding is brought against UBS Securities in respect of which
indemnity may be sought against the Company pursuant to the foregoing paragraph,
UBS Securities shall promptly notify the Company in writing of the institution
of such Proceeding and the Company shall assume the defense of such Proceeding,
including the employment of counsel reasonably satisfactory to UBS Securities
and payment of all fees and expenses; provided, however, that the omission to so
notify the Company shall not relieve the Company from any liability which the
Company may have to UBS Securities or otherwise, unless and only to the extent
that, such omission results in the forfeiture of substantive rights or defenses
by the Company. UBS Securities shall have the right to employ its own counsel in
any such case, but the fees and expenses of such counsel shall be at the expense
of UBS Securities unless the employment of such counsel shall have been
authorized in writing by the Company in connection with the defense of such
Proceeding or the Company shall not have, within a reasonable period of time in
light of the circumstances, employed counsel to have charge of the defense of
such Proceeding or UBS Securities shall have reasonably concluded that there may
be defenses available to it which are different from, additional to or in
conflict with those available to the Company (in which case the Company shall
not have the right to direct the defense of such Proceeding on behalf of UBS
Securities), in any of which events such fees and expenses shall be borne by the
Company and paid as incurred (it being understood, however, that the Company
shall not be liable for the expenses of more than one separate counsel (in
addition to any local counsel) in any one Proceeding or series of related
Proceedings in the same jurisdiction). The Company shall not be liable for any
settlement of any Proceeding effected without its written consent but if settled
with the written consent of the Company, the Company agrees to indemnify and
hold harmless UBS Securities from and against any loss or liability by reason of
such settlement. Notwithstanding the foregoing sentence, if at any time UBS
Securities shall have requested the Company to reimburse UBS Securities for fees
and expenses of counsel as contemplated by the second sentence of this
paragraph, then the Company agrees that it shall be liable for any settlement of
any Proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by the Company of the
aforesaid request, (ii) the Company shall not have reimbursed UBS Securities in
accordance with such request prior to the date of such settlement and (iii) UBS
Securities shall have given the Company at least 30 days' prior notice of its
intention to settle. The Company shall not, without its prior written consent,
effect any settlement of any pending or threatened Proceeding in respect of
which UBS Securities is or could have been a party and indemnity could have been
sought hereunder by UBS Securities, unless such settlement includes an
unconditional release of UBS Securities from all liability on claims that are
the subject matter of such Proceeding and does not include an admission of
fault, culpability or a failure to act, by or on behalf of UBS Securities.
The Company agrees that neither UBS Securities nor any of its affiliates,
directors, agents, employees or controlling persons shall have any liability to
the Company or any person asserting claims on behalf of or in right of the
Company in connection with or as a result of a Covered Claim, except to the
extent that it shall be determined by a court of competent jurisdiction in a
judgment that has become final in that it is no longer subject to appeal or
other review that any losses, claims, damages, liabilities or expenses incurred
by the Company resulted solely from the gross negligence, bad faith or willful
misconduct of UBS Securities in performing the Services.
THIS INDEMNIFICATION AGREEMENT AND ANY CLAIM, COUNTERCLAIM OR DISPUTE OF
ANY KIND OR NATURE WHATSOEVER ARISING OUT OF OR IN ANY WAY RELATING TO THIS
AGREEMENT ("CLAIM"), DIRECTLY OR INDIRECTLY, SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. EXCEPT AS SET FORTH BELOW,
NO CLAIM MAY BE COMMENCED, PROSECUTED OR CONTINUED IN ANY COURT OTHER THAN THE
COURTS OF THE STATE OF NEW YORK LOCATED IN THE CITY AND COUNTY OF NEW YORK OR IN
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, WHICH
COURTS SHALL HAVE EXCLUSIVE JURISDICTION OVER THE ADJUDICATION OF SUCH MATTERS,
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AND THE COMPANY AND UBS SECURITIES CONSENT TO THE JURISDICTION OF SUCH COURTS
AND PERSONAL SERVICE WITH RESPECT THERETO. THE COMPANY HEREBY CONSENTS TO
PERSONAL JURISDICTION, SERVICE AND VENUE IN ANY COURT IN WHICH ANY CLAIM ARISING
OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT IS BROUGHT BY AND THIRD PARTY
AGAINST UBS SECURITIES OR ANY INDEMNIFIED PARTY. EACH OF UBS SECURITIES AND THE
COMPANY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY PROCEEDING OR CLAIM (WHETHER
BASED UPON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR IN ANY WAY RELATING TO
THIS AGREEMENT. THE COMPANY AGREES THAT A FINAL JUDGMENT IN ANY PROCEEDING OR
CLAIM ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT BROUGHT IN ANY
SUCH COURT SHALL BE CONCLUSIVE AND BINDING UPON THE COMPANY AND MAY BE ENFORCED
IN ANY OTHER COURTS TO THE JURISDICTION OF WHICH THE COMPANY IS OR MAY BE
SUBJECT, BY SUIT UPON SUCH JUDGMENT.
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The foregoing Indemnification Agreement shall remain in full force and
effect notwithstanding any termination of UBS Securities's engagement. This
Indemnification Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which shall constitute one and the
same agreement.
Very truly yours,
DEUTSCHE INVESTMENT MANAGEMENT AMERICAS INC.
By: _____________________________
Name:
Title:
Accepted and agreed to as of
the date first above written:
UBS SECURITIES LLC
By: ___________________________
By:
Title:
By: ___________________________
By:
Title:
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