S&C Draft of May 18, 1998
CUSTODIAN AGREEMENT
This CUSTODIAN AGREEMENT dated as of this _th day of May,
1998 by and between _____________, a _____________ banking corporation (the
"Custodian"), 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"), a trust organized under the laws of the State of New York,
under and by virtue of an Amended and Restated Trust Agreement, dated as of
May __, 1998 (the "Trust Agreement").
W I T N E S S E T H
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 (the "Contracts") with one or more existing
shareholders of The Xxxxx Xxxxxx Companies Inc. (the "Company"), and to issue
Trust Automatic Common Exchange Securities (the "Securities") in accordance
with the terms and conditions of the Trust Agreement;
WHEREAS, the Trustees desire to engage the services of the
Custodian to perform certain custodial duties for the Trust; and
WHEREAS, the Custodian is qualified and willing to assume
such duties, 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:
1. Definitions. Capitalized terms not otherwise defined
herein shall have the respective meanings specified in the Trust Agreement.
2. Appointment of Custodian; Transfer of Assets. The
Trustees hereby constitute and appoint the Custodian, and the Custodian
accepts such appointment, as custodian of all of the property, including but
not limited to, the Contracts, the Treasury Securities, U.S. Treasury
securities delivered to the Trust in connection with an extension of the
Exchange Date, the Temporary Investments, any cash and any other property at
any time owned or held by the Trust (collectively, the "Assets"). The
Trustees hereby deposit the Assets with the Custodian and the Custodian
hereby accepts such into its custody and the Trustees shall deliver to the
Custodian all of the Assets, including all monies, securities and other
property received by the Trust at any time during the period of this
Agreement, subject to the following terms and conditions. The Custodian
hereby agrees that it shall hold the Assets in a segregated custody
account, separate and distinct from all other accounts, in accordance
with Section 17(f) of, and in such manner as shall constitute the
segregation and holding in trust within the meaning of, the Investment
Company Act and the rules and regulations thereunder. The Trustees
authorize the Custodian, for any Assets held hereunder, to use the
services of any United States securities depository permitted to perform
such services for registered investment companies and their custodians
under Rule 17f-4 under the Investment Company Act and which have been
approved by the Trustees, including but not limited to, the Depository
Trust Company and the Federal Reserve Book Entry System. The Custodian
shall invest monies on deposit in such custody account in the Temporary
Investments in accordance with Section 3.5 of the Trust Agreement.
Except as otherwise specifically provided in the Trust Agreement, the
Custodian shall not have the power to sell, transfer or otherwise
dispose of any Temporary Investments prior to the maturity thereof, or
to acquire additional Temporary Investments. The Custodian shall hold
any Temporary Investments to maturity and shall apply (or cause to be
applied) the proceeds thereof paid upon maturity to the payment of the
next succeeding Quarterly Distribution. All such Temporary Investments
shall be selected by the Trustees from time to time or pursuant to
standing instructions from the Trustees,
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and the Custodian shall have no liability to the Trust or any Holder or any
other Person with respect to any such Temporary Investments.
3. Asset Disposition; Examinations. The Custodian shall have
no power or authority to assign, hypothecate, pledge or otherwise dispose of
the Assets, except pursuant to a written direction in accordance with
paragraph 4 below and then only for the account of the Trust. The Assets shall
be subject to no lien or charge of any kind in favor of the Custodian for
itself or for any other Person claiming through the Custodian. The Custodian
shall permit actual examination of the Assets by the Trust's independent
public accountant at the end of each annual and semi-annual fiscal period of
the Trust and at least one other time during the fiscal year of the Trust
chosen by such independent public accountant and shall permit the inspection
of the Assets by the Commission through its employees or agents during the
normal business hours of the Custodian upon reasonable request.
4. Authorized Actions. The Custodian shall take such actions
with respect to the Assets as directed in writing by the Trustees or by any
officer of the Administrator as may be received by the Custodian from time to
time.
5. Custodian's Actions Taken In Good Faith. In connection
with the performance of its duties under this Agreement, the Custodian shall be
under no liability to the Trust or any Holder for any action taken in good faith
in reliance on any paper, order, certification, list, demand, request, consent,
affidavit, notice, opinion, direction, endorsement, assignment, resolution,
draft or other document, prima facie properly executed, or for the disposition
of the Assets pursuant to the Trust Agreement or in respect of any action taken
or suffered under the Trust Agreement in good faith, in accordance with an
opinion of counsel or at the direction of the Trustees pursuant hereto; provided
that this provision shall not protect the Custodian against any liability to
which it would otherwise be subject by reason of its reckless disregard of its
obligations and
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duties hereunder. Notwithstanding any other provision of this Agreement, the
Custodian shall under no circumstances be liable for any punitive, exemplary,
indirect or consequential damages.
6. Trust Agreement Validity. The Custodian shall not be
responsible for the validity or sufficiency of the Trust Agreement or the due
execution thereof, or for the form, character, genuineness, sufficiency, value
or validity of any of the Assets and the Custodian shall in no event assume or
incur any liability, duty or obligation to any Holder or to the Trustees,
other than as expressly provided for herein. The Custodian shall not be
responsible for or in respect of the validity of any signature by or on behalf
of the Trustees.
7. Litigation Obligations, Costs and Indemnity. The
Custodian shall not be under any obligation to appear in, prosecute or defend
any action which in its opinion may involve it in expense or liability, unless
it shall be furnished with such reasonable security and indemnity against such
expense or liability as it may require, and any pecuniary costs of the
Custodian from such actions shall be expenses which are reimbursable pursuant
to paragraph 13 hereof.
8. Taxes; Trust Expenses. In no event shall the Custodian be
personally liable for any taxes or other governmental charges imposed upon or
in respect of the Assets or upon the monies, securities or other properties
included therein. The Custodian shall be reimbursed and indemnified by the
Trustees for all such taxes and charges, for any tax or charge imposed against
the Trust and for any expenses, including counsel fees, interest, penalties
and additions to tax which the Custodian may sustain or incur with respect to
such taxes or charges.
9. Custodian Resignation, Succession. (a) The Custodian may
resign by executing an instrument in writing resigning as Custodian and
delivering the same to the Trustees, not less than 60 days before the date
specified in such instrument when, subject to clause (b) of this
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paragraph 9, such resignation is to take effect. Upon receiving such notice of
resignation, the Trustees shall use their reasonable efforts promptly to
appoint a successor Custodian in the manner and meeting the qualifications
provided in the Trust Agreement, by written instrument or instruments delivered
to the resigning Custodian and the successor Custodian.
(b) In case no successor Custodian shall have been appointed
within 30 days after notice of resignation has been received by the Trustees,
the resigning Custodian may forthwith apply to a court of competent
jurisdiction for the appointment of a successor Custodian. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribed,
appoint a successor Custodian.
10. Custodian Removal. The Trustees may remove the Custodian
upon 60 days' prior written notice to the Custodian and appoint a successor
Custodian. In case at any time the Custodian shall not meet the requirements
set forth in the Trust Agreement or shall become incapable of acting or if a
court having jurisdiction shall enter a decree or order for relief in respect
of the Custodian in an involuntary case, or the Custodian shall commence a
voluntary case, under any applicable bankruptcy, insolvency, or other similar
law now or hereafter in effect, or any receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) for the Custodian or
for any substantial part of its property shall be appointed, or the Custodian
shall make any general assignment for the benefit of creditors, or shall
generally fail to pay its debts as they become due, the Trustees may remove
the Custodian immediately and appoint a successor Custodian. The termination
of the Administration Agreement or the Paying Agent Agreement shall cause the
removal of the Custodian simultaneously therewith.
11. Transfers to Successor Custodian. Upon the request of
any successor Custodian, the Custodian hereunder shall, upon payment of all
amounts due it, execute and deliver an instrument acknowledged by it
transferring to such successor Custodian all the rights and powers of the
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resigning Custodian; and the resigning Custodian shall transfer, deliver and
pay over to the successor Custodian the Assets at the time held by it
hereunder, if any, together with all necessary instruments of transfer and
assignment or other documents properly executed necessary to effect such
transfer and such of the records or copies thereof maintained by the resigning
Custodian in the administration hereof as may be requested by the successor
Custodian, and shall thereupon be discharged from all duties and
responsibilities hereunder. Any resignation or removal of the Custodian shall
become effective upon such acceptance of appointment by the successor
Custodian. The indemnification of the resigning Custodian provided for
hereunder shall survive any resignation, discharge or removal of the Custodian
hereunder.
12. Custodian Merger, Consolidation. Any corporation into
which the Custodian 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 Custodian shall be a party, shall be the successor
Custodian 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 Trust has given its
prior written consent to the Custodian with respect to any such merger,
conversion or consolidation.
13. Compensation; Expenses. The Custodian shall receive
compensation for performing the usual, ordinary, normal and recurring services
under this Custodian Agreement and, with the prior written approval of the
Trustees, reimbursement for any and all expenses and disbursements incurred
hereunder, as provided in Section 3.1 of the Administration Agreement.
14. Section 17(f) Qualification. The Custodian hereby
represents that it is qualified to act as a custodian under Section 17(f) of
the Investment Company Act.
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15. Custodian's Limited Liability. The Trustees shall
indemnify and hold the Custodian 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 Custodian
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
Custodian shall not be indemnified and held harmless from and against any such
loss, damages, cost, expense, liability or claim arising from its willful
misfeasance, bad faith or gross negligence in the performance of its duties,
or its reckless disregard of its duties and obligations hereunder. Neither the
Federal Reserve Book Entry System nor the Depository Trust Company shall be
deemed to be agents of the Custodian.
16. Rights of Set-Off; Banker's Lien. The Custodian hereby
waives all rights of set-off or banker's lien it may have with respect to the
Assets held by it as Custodian hereunder.
17. Termination. This Agreement shall terminate
upon the earlier of the termination of the Trust or the
appointment of a successor Custodian.
18. Choice of Law. This Agreement is executed and delivered
in the State of New York, and all laws or rules of construction of the State
of New York shall govern the right of the parties hereto and the
interpretation of the provisions hereof.
19. Notices. Any notice to be given to the Trust hereunder
shall be in writing and shall be duly given if mailed or delivered to Xxxxx
Xxxxxx Automatic Common Exchange Security Trust, c/o Xxxxxx X. Xxxxxxx,
Managing Trustee, Xxxxxxx & Associates, 000 Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxx,
Xxxxxxxx 00000, and to the Custodian if mailed or delivered to _____________,
__________________________, Attention: ___________ or at such other address as
shall be
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specified by the addressee to the other party hereto in writing.
20. No Third Party Beneficiaries. Nothing herein, express or
implied, shall give to any Person, other than the Trustees, the Custodian and
their respective successors and assigns, any benefit of any legal or equitable
right, remedy or claim hereunder.
21. Amendments; Trust Agreement Changes; Waiver. This
Agreement shall not be deemed or construed to be modified, amended, rescinded,
cancelled or waived, in whole or in part, except by a written instrument
signed by a duly authorized representative of the party to be charged. The
Trustees shall notify the Custodian of any change in the Trust Agreement prior
to the effective date of any such change. Failure of either party hereto to
exercise any right or remedy hereunder in the event of a breach hereof by the
other party shall not constitute a waiver of any such right or remedy with
respect to any subsequent breach.
22. Counterparts. This Agreement may be signed
in counterparts with all counterparts constituting one and
the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this
Custodian Agreement to be duly executed as of the day and year first above
written.
TRUSTEES
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Xxxxxxx X. Xxxxxx III,
as Trustee
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Xxxxx X. X'Xxxxx,
as Trustee
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Xxxxxx X. Xxxxxxx,
as Trustee
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By ______________________
Name:
Title:
