S&C Draft of May 8, 1998
FUND INDEMNITY AGREEMENT
FUND INDEMNITY AGREEMENT, dated as of May __, 1998, between
Xxxxxxx, Xxxxx & Co. ("Xxxxxxx Sachs") and Xxxxxxx X. Xxxxxx III, Xxxxx X.
X'Xxxxx and Xxxxxx X. Xxxxxxx (collectively, the "Trustees"), not in their
individual capacities but solely as trustees of Xxxxx Xxxxxx Automatic Common
Exchange Security Trust (the "Trust").
WHEREAS the Trust is a trust formed under the laws of the
State of New York pursuant to a Trust Agreement, as amended and restated as of
May __, 1998 (the "Trust Agreement"); and
WHEREAS, Xxxxxxx Xxxxx, as sponsor under the Trust Agreement,
desires to make provision for the payment of certain indemnification expenses of
the Trust;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained in this Agreement, the parties agree as follows:
1. Definitions. Capitalized terms used herein and not
defined herein shall have the meanings ascribed thereto in the Trust
Agreement.
2. Agreement to Pay Expenses. Xxxxxxx Sachs agrees to pay to
the Trust, and hold the Trust harmless from, any expenses of the Trust arising
under Sections 2.2(e) and 6.6 of the Administration Agreement, Section 15 of
the Custodian Agreement, Section 5.4(b) of the Paying Agent Agreement and
Section 7.6 of the Trust Agreement (collectively, "Indemnification Expenses").
Subject to paragraph 4 hereof, payment hereunder by Xxxxxxx Xxxxx shall be
made in New York Clearing House funds no later than five Business Days after
the receipt by Xxxxxxx Sachs, pursuant to paragraph 3 hereof, of written
notice of any claim for Indemnification Expenses.
3. Notice of Receipt of Claim. The Trustees shall give
notice to, or cause notice to be given to, Xxxxxxx Xxxxx in writing of any
claim for Indemnification Expenses or any threatened claim for Indemnification
Expenses immediately upon their acquiring knowledge thereof. Such written
notice shall be accompanied by any demand, xxxx, invoice or other
communication received from any third party claimant (a "Claimant") in respect
of such Indemnification Expense.
4. Right to Contest. The Trustees agree that Xxxxxxx Xxxxx
may, and Xxxxxxx Sachs is authorized on behalf of the Trustees and the Trust
to, contest in good faith with any Claimant any amount contained in any claim
for Indemnification Expense, provided, that if, within such time period as
Xxxxxxx Xxxxx shall determine to be reasonable, Xxxxxxx Sachs and such
Claimant are unable to resolve amicably any disagreement regarding such claim
for Indemnification Expense, Xxxxxxx Xxxxx shall retain counsel reasonably
satisfactory to the Trustees to represent the Trustees in any resulting
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. It is understood that Xxxxxxx Sachs shall not, in respect of
the legal expenses of any indemnified party in connection with any proceeding
or related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel).
Xxxxxxx Xxxxx shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the Claimant, Xxxxxxx Sachs agrees to indemnify
the Trustees and the Trust from and against any loss or liability by reason of
such settlement or judgment.
5. Statements and Reports. The Trustees shall collect and
safekeep all demands, bills, invoices or other written communications received
from third parties in connection with any claim for Indemnification Expenses
and shall prepare and maintain adequate books and records showing all receipts
and disbursements of funds in connection therewith. Xxxxxxx Xxxxx shall have
the right to inspect and to copy, at its expense, all such documents, books
and records at all reasonable times and from time to time during the term of
this Agreement.
6. Term of Contract. This Agreement shall continue in effect
until the termination of the Trust in accordance with Section 8.3 of the Trust
Agreement.
7. No Assignment. No party to this Agreement may assign its
rights or delegate its duties hereunder without the prior written consent of
the other parties, except that the Trust may delegate any and all duties
hereunder to the Administrator to the extent permitted by law.
8. Entire Agreement. This Agreement contains the entire
agreement among the parties with respect to the matters contained herein and
supersedes all prior agreements or understandings. No amendment or
modification of this Agreement shall be valid unless the amendment or
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modification is in writing and is signed by all the parties
to this Agreement.
9. Notices. All notices, demands, reports, statements,
approvals or consents given by any party under this Agreement shall be in
writing and shall be delivered in person or by telecopy or other facsimile
communication or sent by first-class U.S. mail, registered or certified,
postage prepaid, to the appropriate party at its address on the signature
pages hereof or at such other address subsequently notified to the other
parties hereto. A copy of any communication to Xxxxxxx Sachs shall be
furnished to Xxxxxxx, Xxxxx & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
attention: Registration Department, provided that the failure to furnish such
copy shall not affect the effectiveness of any such communication. Any party
may change its address for purposes hereof by delivering a written notice of
the change to the other parties. All notices, given under this Agreement shall
be deemed received (a) in the case of hand delivery, on the day of delivery,
(b) in the case of telecopy or other facsimile communication, on the day of
transmission, and (c) in the case of mailing, on the third day after such
notice was deposited in the mail.
10. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
11. Governing Law. This Agreement shall be governed by and be
construed in accordance with the laws of the State of New York.
12. Counterparts. This Agreement may be signed in
counterparts with all of such counterparts constituting one and the same
instrument.
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IN WITNESS WHEREOF, the parties have caused this Fund
Indemnity Agreement to be executed by their authorized representatives the
date first above written.
XXXXXXX, SACHS & CO.
By_______________________
Address: 00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
TRUSTEES
---------------------------------
Name: Xxxxxxx X. Xxxxxx III
Address: Department of Economics
University of Delaware
Xxxxxx, Xxxxxxxx 00000
---------------------------------
Name: Xxxxx X. X'Xxxxx
Address: Center for Economic
Education and
Entrepreneurship
University of Delaware
Xxxxxx, Xxxxxxxx 00000
---------------------------------
Name: Xxxxxx X. Xxxxxxx
Address: Department of Finance
University of Delaware
Xxxxxx, Xxxxxxxx 00000
