Exhibit (K)(4)
SHAREHOLDER SERVICING AGREEMENT
SHAREHOLDER SERVICING AGREEMENT (the "Agreement"), dated as of
November 29, 2002, between Xxxxx Xxxxx Management ("Xxxxx Xxxxx") and UBS
Warburg LLC ("UBS Warburg").
WHEREAS, Xxxxx Xxxxx Insured Pennsylvania Municipal Bond Fund (the
"Fund") is a closed-end, non-diversified management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), and its shares of beneficial interest are registered under the Securities
Act of 1933, as amended; and
WHEREAS, Xxxxx Xxxxx is the investment adviser and the administrator
of the Fund; and
WHEREAS, Xxxxx Xxxxx desires to retain UBS Warburg to provide
shareholder servicing and market information with respect to the Fund, and UBS
Warburg is willing to render such services;
NOW, THEREFORE, in consideration of the mutual terms and conditions
set forth below, the parties hereto agree as follows:
1. Xxxxx Xxxxx hereby employs UBS Warburg, for the period and on the
terms and conditions set forth herein, to provide the following
services:
(a) Undertake to make available public information pertaining to the
Fund on an ongoing basis and to communicate to investors and
prospective investors the Fund's features and benefits (including
periodic seminars or conference calls, responses to questions
from current or prospective shareholders and specific shareholder
contact where appropriate);
(b) Make available to investors and prospective investors market
price, net asset value, yield and other information regarding the
Fund, if reasonably obtainable, for the purpose of maintaining
the visibility of the Fund in the investor community;
(c) At the request of Xxxxx Xxxxx or the Fund, provide certain
economic research and statistical information and reports, if
reasonably obtainable, on behalf of Xxxxx Xxxxx or the Fund and
consult with representatives of Xxxxx Xxxxx and/or Trustees of
the Fund in connection therewith, which information and reports
shall include: (i) statistical and financial market information
with respect to the Fund's market performance; and (ii)
comparative information regarding the Fund and other closed-end
management investment companies with respect to (x) the net asset
value of their respective shares, (y) the respective market
performance of
the Fund and such other companies, and (z) other relevant
performance indicators;
(d) At the request of Xxxxx Xxxxx or the Fund, provide information to
and consult with Xxxxx Xxxxx and/or the Board of Trustees of the
Fund with respect to applicable strategies designed to address
market value discounts, which may include share repurchases,
tender offers, modifications to dividend policies or capital
structure, repositioning or restructuring of the Fund, conversion
of the Fund to an open-end investment company, liquidation or
merger; including providing information concerning the use and
impact of the above strategic alternatives by other market
participants;
(e) At the request of Xxxxx Xxxxx or the Fund, UBS Warburg shall
limit or cease any action or service provided hereunder to the
extent and for the time period requested by Xxxxx Xxxxx or the
Fund; provided, however, that pending termination of this
Agreement as provided for is Section 5 hereof, any such
limitation or cessation shall not relieve Xxxxx Xxxxx of its
payment obligations pursuant to Section 2 hereof; and
(f) UBS Warburg will promptly notify Xxxxx Xxxxx or the Fund, as the
case may be, if it learns of any material inaccuracy or
misstatement in, or material omission from, any written
information provided by UBS Warburg to Xxxxx Xxxxx or the Fund in
connection with the performance of services by UBS Warburg under
this Agreement.
2. Xxxxx Xxxxx will pay UBS Warburg a fee computed weekly and payable
quarterly at an annualized rate of 0.10% of the average weekly gross
assets of the Fund; provided, however, that the fee payable hereunder
by Xxxxx Xxxxx to UBS Warburg shall be reduced for the duration of any
period during which Xxxxx Xxxxx voluntarily agrees to reduce or limit
the management fee payable to it by the Fund under any management
contract with the Fund from time-to-time in effect (provided, however,
that the fee payable by Xxxxx Xxxxx shall not be reduced in connection
with any contractual fee waiver or expense reimbursement which is
disclosed in the prospectus of the Fund). The reduced fee payable
hereunder during any such period shall be the percentage of the usual
fee payable hereunder equal to the percentage of the usual management
fee received by Xxxxx Xxxxx after giving effect to the fee waiver or
limitation (i.e., if the management fee is effectively reduced by 40%
the fee hereunder also shall be reduced by 40%); provided further,
that under no circumstances shall the fee hereunder be reduced to less
than zero for any period.
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3. Xxxxx Xxxxx acknowledges that the shareholder services of UBS Warburg
provided for hereunder do not include any advice as to the value of
securities or regarding the advisability of purchasing or selling any
securities for the Fund's portfolio. No provision of this Agreement
shall be considered as creating, nor shall any provision create, any
obligation on the part of UBS Warburg, and UBS Warburg is 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 in connection with providing the services
described in Section 1 hereof.
4. Nothing herein shall be construed as prohibiting UBS Warburg or its
affiliates from providing similar or other services to any other
clients (including other registered investment companies or other
investment managers), so long as UBS Warburg's services to Xxxxx Xxxxx
and the Fund are not impaired thereby.
5. The term of this Agreement shall commence upon the date referred to
above and will continue coterminously with and so long as the
Investment Advisory Agreement, dated October 21, 2002, remains in
effect between the Fund and Xxxxx Xxxxx or any successor in interest
or affiliate of Xxxxx Xxxxx, as, and to the extent, that such
Investment Advisory Agreement is renewed periodically in accordance
with the 1940 Act.
6. Xxxxx Xxxxx will furnish UBS Warburg with such information as UBS
Warburg believes appropriate to its assignment hereunder (all such
information so furnished being the "Information"). Xxxxx Xxxxx
recognizes and confirms that UBS Warburg (a) will use and rely
primarily on the Information and on information available from
generally recognized public sources in performing the services
contemplated by this Agreement without having independently verified
the same and (b) does not assume responsibility for the accuracy or
completeness of the Information and such other information. To the
best of Xxxxx Xxxxx'x knowledge, the Information to be furnished by
Xxxxx Xxxxx when delivered, will be true and correct in all material
respects and will not contain any material misstatement of fact or
omit to state any material fact necessary to make the statements
contained therein not misleading. Xxxxx Xxxxx will promptly notify UBS
Warburg if it learns of any material inaccuracy or misstatement in, or
material omission from, any Information delivered to UBS Warburg.
7. It is understood that UBS Warburg is being engaged hereunder solely to
provide the services described above to Xxxxx Xxxxx and to the Fund
and that UBS Warburg is not acting as an agent or fiduciary of, and
shall have no duties or liability to the current or future
shareholders of the Fund, the current or future shareholders of the
Fund or any other third party in
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connection with its engagement hereunder, all of which are hereby
expressly waived.
8. Xxxxx Xxxxx agrees that UBS Warburg shall have no liability to Xxxxx
Xxxxx or the Fund for any act or omission to act by UBS Warburg in the
course of its performance under this Agreement, in the absence of bad
faith, gross negligence or willful misconduct on the part of UBS
Warburg. Xxxxx Xxxxx agrees to the 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.
9. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK FOR CONTRACTS TO BE PERFORMED ENTIRELY THEREIN AND
WITHOUT REGARD TO THE CHOICE OF LAW PRINCIPLES THEREOF.
10. EACH OF THE XXXXX XXXXX AND UBS WARBURG AGREE THAT ANY ACTION OR
PROCEEDING BASED HEREON, OR ARISING OUT OF UBS WARBURG'S ENGAGEMENT
HEREUNDER, SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN XXX XXXXXX
XX XXX XXXXX XX XXX XXXX LOCATED IN THE CITY AND COUNTY OF NEW YORK OR
IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK. XXXXX XXXXX AND UBS WARBURG EACH HEREBY IRREVOCABLY SUBMIT TO
THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK LOCATED IN THE
CITY AND COUNTY OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
ACTION OR PROCEEDING AS SET FORTH ABOVE AND IRREVOCABLY AGREE TO BE
BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH ACTION
OR PROCEEDING. EACH OF XXXXX XXXXX AND UBS WARBURG HEREBY IRREVOCABLY
WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT
MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH
ACTION OR PROCEEDING BROUGHT IN ANY SUCH REFERRED TO ABOVE AND ANY
CLAIM THAT ANY SUCH ACTION OR PROCEEDING HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
11. Xxxxx Xxxxx and UBS Warburg each hereby irrevocably waive any right
they may have to a trial by jury in respect of any claim based upon or
arising out of this Agreement or the transactions contemplated hereby.
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This Agreement may not be assigned by either party without the prior
written consent of the other party.
12. This Agreement (including the attached Indemnification Agreement)
embodies the entire agreement and understanding between the parties
hereto and supersedes all prior agreements and understandings relating
to the subject matter hereof. If any provision of this Agreement is
determined to be invalid or unenforceable in any respect, such
determination will not affect such provision in any other respect or
any other provision of this Agreement, which will remain in full force
and effect. This Agreement may not be amended or otherwise modified or
waived except by an instrument in writing signed by both UBS Warburg
and Xxxxx Xxxxx.
13. All notices required or permitted to be sent under this Agreement
shall be sent, if to Xxxxx Xxxxx:
Xxxxx Xxxxx Corporation
000 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Chief Legal Officer
or if to UBS Warburg:
UBS Warburg LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Syndicate Department
or such other name or address as may be given in writing to the other
parties. Any notice shall be deemed to be given or received on the
third day after deposit in the U.S. mail with certified postage
prepaid or when actually received, whether by hand, express delivery
service or facsimile transmission, whichever is earlier.
14. This Agreement may be exercised on separate counterparts, each of
which is deemed to be an original and all of which taken together
constitute one and the same agreement.
15. A copy of the Agreement and Declaration of Trust of Xxxxx Xxxxx is on
file with the Secretary of State of The Commonwealth of Massachusetts,
and notice hereby is given that this Agreement is executed on behalf
of the Trustees of Xxxxx Xxxxx as Trustees and not individually and
that the obligations or arising out of this Agreement are not binding
upon any of
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the Trustees or beneficiaries individually but are binding only upon
the assets and properties of Xxxxx Xxxxx.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Shareholder Servicing Agreement as of the date first above written.
XXXXX XXXXX MANAGEMENT
By: _____________________________
Name:
Title:
UBS WARBURG LLC
By: _____________________________
Name: Xxxxx Xxxxxxxx
Title: Managing Director
By: _____________________________
Name: Xxxx X. Reit
Title: Executive Director
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UBS Warburg LLC Indemnification Agreement
November 29, 2002
UBS Warburg LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
In connection with the engagement of UBS Warburg LLC ("UBS Warburg")
to advise and assist the undersigned (together with its affiliates and
subsidiaries, referred to as the "Company") with the matters set forth in the
Agreement dated November 29, 2002 between the Company and UBS Warburg (the
"Agreement"), in the event that UBS Warburg 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") in connection with any matter in any
way relating to or referred to in the Agreement or arising out of the matters
contemplated by the Agreement, including, without limitation, related services
and activities prior to the date of the Agreement, the Company agrees to
indemnify, defend and hold UBS Warburg harmless to the fullest extent permitted
by law, from and against any losses, claims, damages, liabilities and expenses
in connection with any matter in any way relating to or referred to in the
Agreement or arising out of the matters contemplated by the Agreement,
including, without limitation, related services and activities prior to the date
of the Agreement, 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 such losses, claims, damages,
liabilities and expenses resulted solely from the gross negligence or willful
misconduct of UBS Warburg. In addition, in the event that UBS Warburg becomes
involved in any capacity in any Proceeding in connection with any matter in any
way relating to or referred to in the Agreement or arising out of the matters
contemplated by the Agreement, including, without limitation, related services
and activities prior to the date of the Agreement, the Company will reimburse
UBS Warburg for its legal and other expenses (including the cost of any
investigation and preparation) as such expenses are incurred by UBS Warburg 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 and affiliates and other constituencies, on the one hand, and UBS
Warburg, 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 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. The Company
agrees that for the purposes of this paragraph the relative benefits received,
or sought to be received, by the Company and its stockholders and affiliates, on
the one hand, and the party entitled to contribution, on the other hand, of a
transaction as contemplated shall be
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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 stockholders 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 UBS
Warburg has been retained to perform financial services bears to the fees paid
to UBS Warburg under the Agreement; provided, that in no event shall the Company
contribute less than the amount necessary to assure that UBS Warburg is not
liable for losses, claims, damages, liabilities and expenses in excess of the
amount of fees actually received by UBS Warburg 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 Warburg, on the other
hand. The Company will not settle any Proceeding in respect of which indemnity
may be sought hereunder, whether or not UBS Warburg is an actual or potential
party to such Proceeding, without UBS Warburg's prior written consent. For
purposes of this Indemnification Agreement, UBS Warburg shall include UBS
Warburg LLC, any of its affiliates, each other person, if any, controlling UBS
Warburg 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.
The Company agrees that neither UBS Warburg 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 either UBS Warburg's
engagement under the Agreement or any matter referred to in the Agreement,
including, without limitation, related services and activities prior to the date
of the Agreement, 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 or willful misconduct of UBS Warburg in performing the services that
are the subject of the Agreement.
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, AND THE COMPANY AND UBS WARBURG CONSENT TO THE JURISDICTION OF
SUCH COURTS AND PERSONAL SERVICE WITH RESPECT THERETO. THE
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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 WARBURG OR ANY INDEMNIFIED PARTY. EACH OF
UBS WARBURG 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.
The foregoing Indemnification Agreement shall remain in full force
and effect notwithstanding any termination of UBS Warburg'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,
XXXXX XXXXX MANAGEMENT
By: ___________________________
Name:
Title
Accepted and agreed to as of
the date first above written:
UBS WARBURG LLC
By: ___________________________
Name: Xxxxx Xxxxxxxx
Title: Managing Director
By: ___________________________
Name: Xxxx X. Reit
Title: Executive Director
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