ADMINISTRATION AGREEMENT
This ADMINISTRATION AGREEMENT dated as of this _____ day
of _____, 1997 by and between The Bank of New York, a New York
banking corporation (the "Administrator"), and DECS Trust (such
trust and the trustees thereof acting in their capacity as such
being referred to herein as the "Trust"), a statutory business
trust organized under the Business Trust Act of the State of
Delaware pursuant to a Declaration of Trust dated as of November
21, 1995, as amended and restated as of _____, 1997 (the "Trust
Agreement").
WITNESSETH
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
with one or more existing shareholders (the "Sellers") of DIMON
Incorporated (the "Company") (individually, a "Contract" and
collectively, the "Contracts") and to issue DECS in accordance
with the terms and conditions of the Trust Agreement;
WHEREAS the Trust desires to engage the services of
the Administrator to assume certain duties and responsibilities
of the Trust under the Trust Agreement and the Investment Company
Act and to undertake certain services on behalf of and subject to
the supervision of the Trust 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 Trust, 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:
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 Trust hereby engages the Adminis-
trator, and the Administrator hereby agrees to be so engaged, to
provide or cause the provision of the services hereinafter enumerated.
2.2. Services of Administrator. Subject to the supervi-
sion of the Trust, the Administrator shall on behalf of the Trust
take the actions set forth in Sections 2.6, 2.7 and 2.8 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 Treasury Securities except as provided in
Section 2.8 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 on behalf of the Trust
to take the actions set forth in Sections 2.6, 2.7, 2.8 and 3.5
of the Trust Agreement and to otherwise perform the duties of the
Paying Agent referred to in the Trust Agreement;
(b) with the approval of the Trustees, engage legal
and other professional advisors, other than the Trust's
independent accountants as provided in clause 2.2 (iii) above;
(c) 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 Salomon Brothers Inc and The Bank of New
York (the "Fund Expense Agreement") but in no event out of any
assets of the Trust, and give notice to Salomon Brothers Inc
pursuant to the Fund Indemnity Agreement dated the date hereof
between Salomon Brothers Inc and the Trust (the "Fund Indemnity
Agreement") of any claim for Indemnification Expenses (as defined
in the Fund Indemnity Agreement) or any threatened claim for
Indemnification Expenses;
(d) (i) 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 (ii) prepare and, as necessary, mail, file or
publish, or, as appropriate, direct the Paying Agent or cause the
legal and other professional advisors engaged pursuant to Section
2.2(b) to prepare and, as necessary, mail, file or publish any
and all notices, proxies, reports, returns and other
communications and documents as required under the Trust
Agreement, 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 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.;
(e) 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;
(f) receive and review on behalf of the Trust all notices,
reports, certificates and other documents regarding the Contracts
and the Treasury Securities;
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(g) make or cause to be made 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 the Trustees; and
(h) 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 Section 8.2(c) of
the Trust Agreement and 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 2.2(h) 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 punitive, exemplary, 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). Without limiting the generality of the preceding
sentence, the Administrator (i) 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 2.5(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) 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 and other documents required under the
Investment Company Act or the Securities Exchange Act of 1934.
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 any notice of any change of authority of any person until
receipt of written notice thereof from a Trustee.
2.4. Power of Attorney. The Trustees hereby appoint
the Administrator, acting through any duly appointed officer,
the attorney-in-fact and agent of the Trust for the purpose of
performing the duties prescribed in Sections 2.2(d)(ii) and
2.2(g).
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 and the Investment Company
Act,
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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, as custodian under the
Custodian Agreement, dated as of _____, 1997, between the
Administrator, as custodian, and the Trust, as paying agent under
the Paying Agent Agreement, dated as of _____, 1997, between the
Administrator, as paying agent, and the Trust, and as collateral
agent under the Collateral Agreements, dated as of _____, 1997,
among the Administrator, as collateral agent, each of the Sellers
and the Trust, and for the payment of Trust expenses pursuant to
Section 2.2(c) 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.
3.2. Additional Services. If and to the extent that
the Trustee 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.
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 or default in
the performance of any provision of this Agreement, the
Trust Agreement, or the Investment Company Act, and after
notice of such violation or default, shall not cure such
violation or default within 30 days; or
(ii) If the Administrator shall be adjudged bankrupt
or insolvent by a court of competent jurisdiction, 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
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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 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 Trustee.
(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 all Collateral
Agreements, (iv) upon termination of the Custodian Agreement or
(v) upon the resignation or removal of the Custodian.
(c) The Trustees may remove the Administrator, or the
Administrator may resign, and thereby terminate this Agreement
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
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 moneys available to the Trust, the
financial condition of the Trust and all other relevant matters
concerning the Trust.
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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 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: DECS Trust
c/o Puglisi & Associates
000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Telephone: 000-000-0000
Telecopier: 000-000-0000
The Administrator: The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx X. Xxxxx
Telephone: 000-000-0000
Telecopier: 000-000-0000
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.
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
counterpart with all counterparts constituting one and the same
instrument.
IN WITNESS WHEREOF, the parties have hereunto executed
this Administration Agreement as of the day and year first above
written.
DECS TRUST
_________________________
Xxxxxx X. Xxxxxxx
as Managing Trustee
THE BANK OF NEW YORK
By:______________________
Name:
Title:
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