STRUCTURING FEE AGREEMENT
October [●], 2010
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This agreement is between Guggenheim Funds Investment Advisors, LLC (the "Adviser"), Guggenheim Partners Asset Management, LLC (the "Sub-Adviser," and together with the Adviser, the "Companies") and Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx") with respect to the Guggenheim Build America Bonds Managed Duration Trust (the "Trust").
1. Fee.
(a) In consideration of advice to the Companies relating to, but not limited to, the design and structuring of the Trust and the distribution of its common shares of beneficial interest, par value $.01 per share (the "Common Shares"), the Companies shall pay a fee to Xxxxxx Xxxxxxx calculated at [▪]% of the aggregate price to the public of the Common Shares sold by Xxxxxx Xxxxxxx in the Trust’s initial public offering (the "Offering") (including any Common Shares over-allotted by Xxxxxx Xxxxxxx in the Offering regardless of whether the over-allotment option in the Offering is exercised), equal to $[•] (the "Fee"), $[•] of which will be paid by the Adviser, and $[•] of which will be paid by the Sub-Adviser.
(b) The Companies shall each pay the Fee to Xxxxxx Xxxxxxx on or before the closing of the purchase and sale of the Common Shares pursuant to the Underwriting Agreement on October [•], 2010, by wire transfer to the order of Xxxxxx Xxxxxxx. The Companies acknowledge that the Fee is in addition to any compensation Xxxxxx Xxxxxxx earns in connection with its role as an underwriter to the Trust in the Offering, which services are distinct from and in addition to the structuring services described above.
2. Term. This Agreement shall terminate upon payment of the entire amount of the Fee, as specified in Section 1 hereof.
3. Indemnification. The Companies agree to the joint and several indemnification and other agreements set forth in the Indemnification Agreement attached hereto, the provisions of which are incorporated herein by reference and shall survive the termination, expiration or supersession of this Agreement.
4. Not an Investment Advisor. Each of the Companies acknowledge that Xxxxxx Xxxxxxx is not providing any advice hereunder as to the value of securities or regarding the advisability of purchasing or selling any securities for the Trust’s portfolio. No provision of this Agreement shall be considered as creating, nor shall any provision create, any obligation on the part of Xxxxxx Xxxxxxx, and Xxxxxx Xxxxxxx is not agreeing hereby, 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.
5. Not Exclusive. Nothing herein shall be construed as prohibiting Xxxxxx Xxxxxxx or its affiliates from acting as an underwriter or financial advisor or in any other capacity for any other persons
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6. Assignment. This Agreement may not be assigned by either party without prior written consent of the other parties.
7. Amendment; Waiver. No provision of this Agreement may be amended or waived except by an instrument in writing signed by the parties hereto.
8. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts executed in and to be performed in that state.
9. Counterparts. This 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 Agreement by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.
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GUGGENHEIM FUNDS INVESTMENT
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ADVISORS, LLC
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By:______________________________
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Name:
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Title:
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GUGGENHEIM PARTNERS ASSET
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MANAGEMENT, LLC
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By:_______________________________
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Name:
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Title:
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Agreed and Accepted:
XXXXXX XXXXXXX & CO. INCORPORATED
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By:_____________________________
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Name:
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Title:
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INDEMNIFICATION AGREEMENT
October [●], 2010
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
In connection with the engagement of Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx") to advise and assist the undersigned (together with its affiliates and subsidiaries, referred to as the "Companies") with the matters set forth in the Structuring Fee Agreement dated October [•], 2010 between the Companies and Xxxxxx Xxxxxxx (the "Structuring Fee Agreement"),in the event that Xxxxxx Xxxxxxx 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) with respect to the services performed pursuant to and in accordance with the Structuring Fee Agreement, the Companies have agreed to jointly and severally indemnify and hold harmless Xxxxxx Xxxxxxx and Xxxxxx Xxxxxxx’x affiliates and their respective officers, directors, employees and agents and each other person, if any, controlling Xxxxxx Xxxxxxx or any of Xxxxxx Xxxxxxx’x affiliates (Xxxxxx Xxxxxxx and each such other person being an "Indemnified Person") from and against any losses, claims, damages or liabilities related to, arising out of or in connection with the activities (the "Activities") performed by any Indemnified Person in connection with, or arising out of, or based upon, the Structuring Fee Agreement and/or any action taken by any Indemnified Person in connection therewith (including, without limitation, any presentation given by the Companies and an Indemnified Person relating to the Common Shares of Guggenheim Build America Bonds Managed Duration Trust (the "Trust"), and will reimburse each Indemnified Person for all expenses (including fees and expenses of counsel) as they are incurred in connection with investigating, preparing, pursuing or defending any claim, suit, action, proceeding, investigation or inquiry related to, arising out of or in connection with the Activities, whether or not pending or threatened and whether or not any Indemnified Person is a party. The Companies will not, however, be responsible for any losses, claims, damages, liabilities (or expenses relating thereto) that are finally judicially determined to have resulted from the bad faith or gross negligence of any Indemnified Person. The Companies also agree that no Indemnified Person shall have any liability (whether direct or indirect, in contract or tort or otherwise) to the Companies for or in connection with the Activities, except for any such liability for losses, claims, damages or liabilities incurred by the Companies that are finally judicially determined to have resulted from the bad faith or gross negligence of such Indemnified Person.
Notwithstanding the foregoing, in no event shall the Companies be responsible for any losses, claims, damages or liabilities to any Indemnified Person arising from any such claim, suit, action, proceeding, investigation or inquiry in excess of the gross proceeds received by the Trust from the initial public offering of the Common Shares of the Trust (the "Offering"); provided, however, that the Companies shall, as set forth above, jointly and severally indemnify and be responsible for, regardless of the gross proceeds received by the Trust from the Offering, all expenses (including fees and expenses of counsel) incurred in connection with investigating, preparing, pursuing or defending any claim, suit, action, proceeding, investigation or inquiry related to, arising out of or in connection with the Activities, whether or not pending or threatened and whether or not any Indemnified Person is a party, as set forth above.
No Company will, without Xxxxxx Xxxxxxx’x prior written consent, settle, compromise, consent to the entry of any judgment in or otherwise seek to terminate any claim, suit, action, proceeding, investigation or inquiry in respect of which indemnification may be sought hereunder (whether or not any
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If such indemnification were not to be available for any reason, each Company agrees to, jointly and severally with the other Company, 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 that Company (including the net proceeds from the Common Shares sold by Xxxxxx Xxxxxxx in the Offering before deducting expenses) and its partners and affiliates and other constituencies, on the one hand, and Xxxxxx Xxxxxxx, on the other hand, in the matters contemplated by the Structuring Fee 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 that Company and its partners and affiliates and other constituencies, on the one hand, and the party entitled to contribution, on the other hand, as well as any other relevant equitable considerations. Each Company agrees that for the purposes of this paragraph the relative benefits received, or sought to be received, by that Company and its partners and affiliates, on the one hand, and the party entitled to contribution, on the other hand, of a transaction as contemplated shall be deemed to be in the same proportion that the total value received or paid or contemplated to be received or paid by the Company or its partners or affiliates and other constituencies, as the case may be, as a result of or in connection with the transaction (whether or not consummated) for which Xxxxxx Xxxxxxx has been retained to perform financial services bears to the fees paid to Xxxxxx Xxxxxxx under the Structuring Fee Agreement; provided that in no event shall the Company contribute less than the amount necessary to assure that Xxxxxx Xxxxxxx is not liable for losses, claims, damages, liabilities and expenses in excess of the amount of fees actually received by Xxxxxx Xxxxxxx pursuant to the Structuring Fee 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 a Company or other conduct by that Company (or its employees or other agents), on the one hand, or by Xxxxxx Xxxxxxx, on the other hand.
This Indemnification Agreement, together with the Structuring Fee Agreement, any contemporaneous written agreements and any prior written agreements (to the extent not superseded by this agreement) that relate to the Offering of the Common Shares, represents the entire agreement between the Companies and the Indemnified Parties with respect to the structuring fee paid to Xxxxxx Xxxxxxx under the Structuring Fee Agreement.
The Companies acknowledge that in connection with the Offering of the Common Shares: (i) Xxxxxx Xxxxxxx has acted at arms length, is not an agent of, and owes no fiduciary duties to, the Company, the Trust or any person affiliated with the Trust or the Companies, (ii) Xxxxxx Xxxxxxx owes the Companies only those duties and obligations set forth in this Indemnification Agreement and (iii) Xxxxxx Xxxxxxx may have interests that differ from those of the Companies. The Companies waive to the full extent permitted by applicable law any claims any of the Companies, the Trust or any person affiliated with the Trust or the Companies may have against Xxxxxx Xxxxxxx arising from an alleged breach of fiduciary duty in connection with the offering of the Common Shares.
The provisions of this Indemnification Agreement shall apply to the Activities and any modification thereof and shall remain in full force and effect regardless of any termination or the completion of Xxxxxx Xxxxxxx’x services under the Structuring Fee Agreement.
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This Indemnification Agreement may not be assigned by either party without prior written consent of the other party. No provision of this Indemnification Agreement may be amended or waived except by an instrument in writing signed by the parties hereto. This Indemnification Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts executed in and to be performed in that state. This Indemnification 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 Indemnification Agreement by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.
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The foregoing Indemnification Agreement shall remain in full force and effect notwithstanding any termination of Xxxxxx Xxxxxxx’x engagement under the Structuring Fee Agreement. 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,
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GUGGENHEIM FUNDS INVESTMENT
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ADVISORS, LLC
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By:___________________________
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Name:
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Title:
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GUGGENHEIM PARTNERS ASSET
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MANAGEMENT, LLC
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By:_______________________________
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Name:
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Title:
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Agreed and Accepted:
XXXXXX XXXXXXX & CO. INCORPORATED
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By:___________________________________
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Name:
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Title:
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