Exhibit (h)(ii)
ADDITIONAL COMPENSATION AGREEMENT
ADDITIONAL COMPENSATION AGREEMENT (the "Agreement"), dated as of [ ],
2005 between [ ] ("[ ]") and Claymore Advisors, LLC
("Claymore").
WHEREAS, [ ] (including any successor by merger or
otherwise) (the "Fund") is a non-diversified, closed-end management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), and its common shares are registered under the Securities Act of
1933, as amended; and
WHEREAS, Claymore is the investment adviser of the Fund;
WHEREAS, [ ] is acting as an underwriter in an offering of
the Fund's common shares;
WHEREAS, Claymore desires to provide additional compensation to
[ ] for acting as an underwriter in an offering of the Fund's
common shares; and
WHEREAS, Claymore desires to retain [ ] to provide after-market
support services designed to maintain the visibility of the Fund on an ongoing
basis, and [ ] 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. (a) Claymore hereby employs [ ], for the period and on the
terms and conditions set forth herein, to provide the following
services at the reasonable request of Claymore:
(1) after-market support services designed to maintain the
visibility of the Fund on an ongoing basis;
(2) 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 Claymore in
connection therewith; and
(3) information to and consultation with Claymore with
respect to applicable strategies designed to address
market value discounts, if any.
(b) At the request of Claymore, [ ] shall limit or cease any
action or service provided hereunder to the extent and for the time
period requested by Claymore; provided, however, that pending
termination of this Agreement as provided for in Section 5 hereof, any
such limitation or cessation shall not relieve Claymore of its payment
obligations pursuant to Section 2 hereof.
(c) [ ] will promptly notify Claymore if it learns of any
material inaccuracy or misstatement in, or material omission from, any
written information, as of the date such information was published,
provided by [ ] to Claymore in connection with the
performance of services by [ ] under this Agreement.
2. Claymore shall pay [ ] a fee computed weekly and payable quarterly in
arrears commencing [ ], 2005 at an annualized rate of [ ]% of the
Fund's Managed Assets (as defined below) [attributable to the common shares
sold by [ ] in this offering] for a term as described in Section 6
hereof; provided that the total amount of the fee hereunder shall not
exceed [ ]% of the total price to the public of the Fund's common
shares offered by the prospectus dated [ ] (the "Prospectus")
(including all Initial Securities and Option Securities as such terms are
described in the Purchase Agreement, dated [ ], by and among the
Fund, Claymore and each of the Underwriters named therein (the "Purchase
Agreement")). The sum total of this fee, any additional compensation fees
payable to [ ], plus the amount of the expense reimbursement of
$[ ] per common share payable by the Fund to the underwriters pursuant to
the Purchase Agreement shall not exceed 4.5% of the total price to the
public of the Fund's common shares offered by the Prospectus. The sum total
of all compensation to the underwriters in connection with the Offering,
including sales load and other underwriting compensation in connection with
the Offering, shall not exceed 9.0% of the total price to the public of the
Fund's common shares offered by the Prospectus. "Managed Assets" is defined
as the total assets of the Fund, including the assets attributable to the
proceeds from any financial leverage, minus liabilities, other than
liabilities related to any financial leverage. All quarterly fees payable
hereunder shall be paid to [ ] within 15 days following the end
of each calendar quarter.
3. Claymore shall be permitted to discharge all or a portion of its payment
obligations hereunder upon prepayment in full or in part of the remaining
balance due of the maximum additional commission amount described in
Section 2 above.
4. Claymore acknowledges that the services of [ ] 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 [ ],
and [ ] 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.
5. Nothing herein shall be construed as prohibiting [ ] 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 [ ] services to Claymore are not impaired
thereby.
6. The term of this Agreement shall commence upon the date referred to above
and shall be in effect for a term of five years.
7. Claymore will furnish [ ] with such information as [ ]
believes appropriate to its assignment hereunder (all such information so
furnished being the "Information"). Claymore recognizes and confirms that
[ ] (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 Claymore's knowledge, the
Information to be furnished by Claymore 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. Claymore will promptly
notify [ ] if it learns of any material inaccuracy or misstatement
in, or material omission from, any Information delivered to [ ].
8. Claymore agrees that [ ] shall have no liability to Claymore or
the Fund for any act or omission to act by [ ] in the course of its
performance under this Agreement, in the absence of gross negligence or
willful misconduct on the part of [ ]. Claymore agrees to the
indemnification and other agreement 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 and any claim, counterclaim or dispute of any kind or nature
whatsoever arising out of or in any way relating to this Agreement
("Claim") shall be governed by and construed in accordance with the laws of
the State of New York.
10. 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 Claymore and [ ] consent to the
jurisdiction of such courts and personal service with respect thereto. Each
of [ ] and Claymore waives all right to trial by jury in any
proceeding (whether based upon contract, tort or otherwise) in any way
arising out of or relating to this Agreement. Claymore agrees that a final
judgment in any proceeding or counterclaim brought in any such court shall
be conclusive and binding upon Claymore and may be enforced in any other
courts to the jurisdiction of which Claymore is or may be subject, by suit
upon such judgment.
11. 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 [ ] and Claymore.
13. All notices required or permitted to be sent under this Agreement shall be
sent, if to Claymore:
Claymore Advisors, LLC
0000 Xxxxxxxxx Xxxx Xxxxx
Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxx Xxxxxxx
or if to [ ]:
[ ]
[ ]
[ ]
Attention: [ ]
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 US 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 executed in separate counterparts, each of which is
deemed to be an original and all of which taken together constitute one and
the same agreement.
IN WITNESS WHEREOF, the parties hereto have duly executed this Additional
Compensation Agreement as of the date first above written.
CLAYMORE ADVISORS, LLC [ ]
By:
------------------------------ By:
------------------------------
Name: Name:
Title: Title:
[ ] INDEMNIFICATION AGREEMENT
[ ]
[ ]
[ ]
[ ]
Ladies and Gentlemen:
In connection with the engagement of [ ] ("[ ]")
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 [ ] between the Company and [ ] (the
"Agreement"), in the event that [ ] 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, the Company agrees to indemnify, defend and hold
[ ] 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, 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 [ ]. In addition, in the event
that [ ] 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, the
Company will reimburse [ ] for its legal and other expenses (including
the cost of any investigation and preparation) as such expenses are incurred by
[ ] 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 [ ], 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
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 [ ] has been retained to perform financial services bears to the
fees paid to [ ] under the Agreement; provided, that in no event shall
the Company contribute less than the amount necessary to assure that [ ]
is not liable for losses, claims, damages, liabilities and expenses in excess of
the amount of fees
actually received by [ ] 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 [ ], on the other hand. The
Company will not settle any Proceeding in respect of which indemnity may be
sought hereunder, whether or not [ ] is an actual or potential party to
such Proceeding, without [ ]'s prior written consent. For purposes of
this Indemnification Agreement, [ ] shall include [ ] Capital
Markets, LLC., any of its affiliates, each other person, if any, controlling
[ ] 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 [ ] 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 [ ]'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 [ ] 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 [ ] 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 ANY THIRD PARTY AGAINST
[ ] OR ANY INDEMNIFIED PARTY. EACH OF [ ] 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 [ ]'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,
CLAYMORE ADVISORS, LLC
By:
-------------------
Name:
Title:
Accepted and agreed to as of
the date first above written:
[ ]
By
----------------------
Name:
Title:
