Exhhibit 13(d)
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BROKER-DEALER AGREEMENT
between
IBJ XXXXXXXX BANK & TRUST COMPANY
and
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
Dated as of December 23, 1991
Relating to
AUCTION MARKET PREFERRED STOCK(R)
("AMPS"(R))
Series A, Series B, Series C, Series D and Series E
of
MUNIYIELD FUND, INC.
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(R) Registered trademark of Xxxxxxx Xxxxx & Co., Inc.
BROKER-DEALER AGREEMENT dated as of December 23, 1991 between IBJ Xxxxxxxx
Bank & Trust Company, a New York banking corporation (the "Auction Agent") (not
in its individual capacity but solely as agent of MuniYield Fund, Inc., a
Maryland corporation (the "Company"), pursuant to authority granted to it in the
Auction Agent Agreement dated as of December 23, 1991, between the Company and
the Auction Agent (the "Auction Agent Agreement")) and Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated (together with its successors and assigns
hereinafter referred to as "BD").
The Company has duly authorized and issued 900 shares of Auction Market
Preferred Stock(R), Series A ("Series A AMPS"), 900 shares of Auction Market
Preferred Stock, Series B ("Series B AMPS"), 900 shares of Auction Market
Preferred Stock, Series C ("Series C AMPS"), 900 shares of Auction Market
Preferred Stock, Series D ("Series D AMPS") and 1,400 shares of Auction Market
Preferred Stock, Series E ("Series E AMPS"), all with a par value of $.10 per
share and a liquidation preference of $50,000 per share plus accumulated but
unpaid dividends (whether or not earned or declared), each pursuant to the
Company's Articles Supplementary (as defined below). The Series A AMPS, Series B
AMPS, Series C AMPS, Series D AMPS and Series E AMPS are sometimes referred to
together herein as "AMPS".
The Company's Articles Supplementary provide that the dividend rate on
each series of AMPS for each Dividend Period therefor after the Initial Dividend
Period shall be the Applicable Rate therefor, which in each case, in general,
shall be the rate per annum that a commercial bank, trust company or other
financial institution appointed by the Company advises results from
implementation of the Auction Procedures (as defined below). The Board of
Directors of the Company has adopted a resolution appointing IBJ Xxxxxxxx Bank &
Trust Company as Auction Agent for purposes of the Auction Procedures, and
pursuant to Section 2.5(d) of the Auction Agent Agreement, the Company has
requested and directed the Auction Agent to execute and deliver this Agreement.
The Auction Procedures require the participation of one or more
Broker-Dealers.
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(R) Registered trademark of Xxxxxxx Xxxxx & Co., Inc.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the Auction Agent and BD agree as follows:
1. Definitions and Rules of Construction.
1.1 Terms Defined by Reference to the Articles Supplementary. Capitalized
terms not defined herein shall have the respective meanings specified in the
Articles Supplementary of the Company.
1.2 Terms Defined Herein. As used herein and in the Settlement Procedures
(as defined below), the following terms shall have the following meanings,
unless the context otherwise requires:
(a) "Articles Supplementary" shall mean the Articles Supplementary,
as amended, of the Company, establishing the powers, preferences and
rights of the AMPS filed on December 20, 1991 in the office of the State
Department of Assessments and Taxation of the State of Maryland.
(b) "Auction" shall have the meaning specified in Section 2 .1
hereof.
(c) "Auction Procedures" shall mean the Auction Procedures that are
set forth in Paragraph 11 of the Articles Supplementary.
(d) "Authorized Officer" shall mean each Senior Vice President, Vice
President, Assistant Vice President, Trust Officer, Assistant Secretary
and Assistant Treasurer of the Auction Agent assigned to its Corporate
Trust and Agency Group and every other officer or employee of the Auction
Agent designated as an "Authorized Officer" for purposes of this Agreement
in a communication to BD:
(e) "BD Officer" shall mean each officer or employee of BD
designated as a "BD Officer" for purposes of this Agreement in a
communication to the Auction Agent.
(f) "Broker-Dealer Agreement" shall mean this Agreement and any
substantially similar agreement between the Auction Agent and a
Broker-Dealer.
(g) "Purchaser's Letter" shall mean a letter addressed to the
Company, the Auction Agent and a Broker-Dealer, substantially in the form
attached hereto as Exhibit A.
(h) "Settlement Procedures" shall mean the Settlement Procedures
attached hereto as Exhibit B.
1.3 Rules of Construction. Unless the context or use indicates another or
different meaning or intent, the following rules shall apply to the construction
of this Agreement:
(a) Words importing the singular number shall include the plural
number and vice versa.
(b) The captions and headings herein are solely for convenience of
reference and shall not constitute a part of this Agreement nor shall they
affect its meaning, construction or effect.
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(c) The words "hereof," "herein," "hereto," and other words of
similar import refer to this Agreement as a whole.
(d) All references herein to a particular time of day shall be to
New York City time.
2. Notification of Dividend Period and Advance Notice of Allocation of
Taxable Income.
(a) The provisions contained in paragraph 2 of the Articles
Supplementary concerning the notification of a Special Dividend Period
will be followed by the Auction Agent and BD and the provisions contained
therein are incorporated herein by reference in their entirety and shall
be deemed to be a part of this Agreement to the same extent as if such
provisions were fully set forth herein.
(b) Whenever the Company intends to include any net capital gains or
other taxable income in any dividend on shares of any series of AMPS, the
Company will notify the Auction Agent of the amount to be so included at
least five Business Days prior to the Auction Date on which the Applicable
Rate for such dividend is to be established. Whenever the Auction Agent
receives such notice from the Company, it will in turn notify BD, who, on
or prior to such Auction Date, will notify its Existing Holders and
Potential Holders believed to be interested in submitting an Order in the
Auction to be held on such Auction Date.
3. The Auction.
3.1 Purpose; Incorporation by Reference of Auction Procedures and
Settlement Procedures.
(a) On each Auction Date, the provisions of the Auction Procedures
will be followed by the Auction Agent for the purpose of determining the
Applicable Rate for each series of AMPS, for the next Dividend Period
therefor. Each periodic operation of such procedures is hereinafter
referred to as an "Auction."
(b) All of the provisions contained in the Auction Procedures and
the Settlement Procedures are incorporated herein by reference in their
entirety and shall be deemed to be a part of this Agreement to the same
extent as if such provisions were fully set forth herein.
(c) BD is delivering herewith a Purchaser's Letter executed by BD
and, in the case of Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, a
list of persons to whom BD will initially sell the shares of each series
of AMPS, the number of shares of each series of AMPS BD will sell to each
such person and the number of shares of each series of AMPS BD will hold
for its own account. BD agrees to act as, and assumes the obligations of
and limitations and restrictions placed upon, a Broker-Dealer under this
Agreement. BD understands that other Persons meeting the requirements
specified in the definition of "Broker-Dealer" contained in Paragraph 1 of
the Articles Supplementary may execute a Broker-Dealer Agreement and a
Purchaser's Letter and participate as Broker-Dealers in Auctions.
(d) BD and other Broker-Dealers may participate in Auctions for
their own accounts, provided that BD or such other Broker-Dealers, as the
case may be, has executed a Purchaser's Letter. However, the Company may
by notice to BD and all other Broker-Dealers prohibit all
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Broker-Dealers from submitting Bids in Auctions for their own accounts,
provided that Broker-Dealers may continue to submit Hold Orders and Sell
Orders.
3.2 Preparation for Each Auction.
(a) Not later than 9:30 A.M. on each Auction Date for each series of
AMPS, the Auction Agent shall advise BD by telephone of the Reference Rate
and the Maximum Applicable Rate in effect on such Auction Date.
(b) In the event that the Auction Date for any Auction shall be
changed after the Auction Agent has given the notice referred to in clause
(vii) of paragraph (a) of the Settlement Procedures, the Auction Agent, by
such means as the Auction Agent deems practicable, shall give notice of
such change to BD not later than the earlier of 9:15 A.M. on the new
Auction Date or 9:15 A.M. on the old Auction Date. Thereafter, BD shall
promptly notify customers of BD that BD believes are Existing Holders of
shares of Series A AMPS, Series B AMPS, Series C AMPS, Series D AMPS or
Series E AMPS, as the case may be, of such change in the Auction Date.
(c) The Auction Agent from time to time may request BD to provide it
with a list of the respective customers BD believes are Existing Holders
of shares of each series of AMPS. BD shall comply with any such request,
and the Auction Agent shall keep confidential any such information,
including information received as to the identity of Bidders in any
Auction, and shall not disclose any such information so provided to any
Person other than the Company; and such information shall not be used by
the Auction Agent or its officers, employees, agents or representatives
for any purpose other than such purposes as are described herein. The
Auction Agent shall transmit any list of customers BD believes are
Existing Holders of shares of each series of AMPS and information related
thereto only to its officers, employees, agents or representatives in the
Corporate Trust and Agency Group who need to know such information for the
purposes of acting in accordance with this Agreement and shall prevent the
transmission of such information to others and shall cause its officers,
employees, agents and representatives to abide by the foregoing
confidentiality restrictions; provided, however, that the Auction Agent
shall have no responsibility or liability for the actions of any of its
officers, employees, agents or representatives after they have left the
employ of the Auction Agent.
(d) The Auction Agent is not required to accept the Purchaser's
Letter for any Potential Holder for an Auction unless it is received by
the Auction Agent by 3:00 P.M. on the Business Day next preceding such
Auction.
3.3 Auction Schedule; Method of Submission of Orders.
(a) The Company and the Auction Agent shall conduct Auctions for
each series of AMPS in accordance with the schedule set forth below. Such
schedule may be changed at any time by the Auction Agent with the consent
of the Company, which consent shall not be unreasonably withheld. The
Auction Agent shall give notice of any such change to BD. Such notice
shall be received prior to the first Auction Date on which any such change
shall be effective.
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Time Event
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By 9:30 A.M. Auction Agent advises the Company and
Broker-Dealers of Reference Rate and the
Maximum Applicable Rate as set forth in
section 3.2(a) hereof.
9:30 A.M. - 1:00 P.M. Auction Agent assembles information
communicated to it by Broker-Dealers as
provided in Paragraph 11(c)(i) of the
Articles Supplementary. Submission Deadline
is 1:00 P.M.
Not earlier than 1:00 P.M. Auction Agent makes determinations pursuant
to Paragraph 11(d)(i) of the Articles
Supplementary.
By approximately 3:00 P.M. Auction Agent advises Company of results of
Auction as provided in Paragraph 11(d)(ii)
of the Articles Supplementary.
Submitted Bids and Submitted Sell Orders are
accepted and rejected in whole or in part
and shares of AMPS are allocated as provided
in Paragraph 11(e) of the Articles
Supplementary.
By approximately 10:00 A.M. on Auction Agent gives notice of Auction
the next succeeding Business Day results as set forth in Section 3.4(a)
hereof.
(b) BD agrees to maintain a list of Potential Holders and to contact
the Potential Holders on such list on or prior to each Auction Date for
the purposes set forth in Paragraph 11 of the Articles Supplementary.
(c) BD agrees not to sell, assign or dispose of any shares of any
series of AMPS, to any Person who has not delivered a signed Purchaser's
Letter to the Auction Agent.
(d) BD shall submit Orders to the Auction Agent in writing in
substantially the form attached hereto as Exhibit C. BD shall submit
separate Orders to the Auction Agent for each Potential Holder or Existing
Holder on whose behalf BD is submitting an Order and shall not net or
aggregate the orders of Potential Holders or Existing Holders on whose
behalf BD is submitting orders.
(e) BD shall deliver to the Auction Agent (i) a written notice,
substantially in the form attached hereto as Exhibit D, of transfers of
shares of any series of AMPS, made through BD by an Existing Holder to
another Person other than pursuant to an Auction, and (ii) a written
notice, substantially in the form attached hereto as Exhibit E, of the
failure of shares of any series of AMPS to be transferred to or by any
Person that purchased or sold shares of any series of AMPS or through BD
pursuant to an Auction. The Auction Agent is not required to accept any
notice delivered pursuant to the terms of the foregoing sentence with
respect to an Auction
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unless it is received by the Auction Agent by 3:00 P.M. on the Business
Day next preceding the applicable Auction Date.
3.4 Notice of Auction Results.
(a) On each Auction Date, the Auction Agent shall notify BD by
telephone as set forth in paragraph (a) of the Settlement Procedures. On
the Business Day next succeeding such Auction Date, the Auction Agent
shall notify BD in writing of the disposition of all Orders submitted by
BD in the Auction held on such Auction Date.
(b) BD shall notify each Existing Holder or Potential Holder on
whose behalf BD has submitted an Order as set forth in paragraph (b) of
the Settlement Procedures and take such other action as is required of BD
pursuant to the Settlement Procedures.
If any Existing Holder selling shares of any series of AMPS in an Auction
fails to deliver such shares, the BD of any Person that was to have purchased
shares of such series of AMPS in such Auction may deliver to such Person a
number of whole shares of such series of AMPS that is less than the number of
shares that otherwise was to be purchased by such Person. In such event, the
number of shares of such series of AMPS to be so delivered shall be determined
by such BD. Delivery of such lesser number of shares shall constitute good
delivery. Upon the occurrence of any such failure to deliver shares, such BD
shall deliver to the Auction Agent the notice required by Section 3.3(e)(ii)
hereof. Notwithstanding the foregoing terms of this Section 3.4(b), any delivery
or non-delivery of shares of any series of AMPS which represents any departure
from the results of an Auction, as determined by the Auction Agent, shall be of
no effect unless and until the Auction Agent shall have been notified of such
delivery or non-delivery in accordance with the terms of Section 3.3 (e) hereof.
The Auction Agent shall have no duty or liability with respect to enforcement of
this Section 3.4(b).
3.5 Service Charge to Be Paid to BD. On the Business Day next succeeding
each Auction Date, the Auction Agent shall pay to BD from moneys received from
the Company an amount equal to: (a) in the case of any Auction Date immediately
preceding a 7-day Dividend Period, 28-day Dividend Period or Short Term Dividend
Period, the product of (i) a fraction the numerator of which is the number of
days in such Dividend Period (calculated by counting the first day of such
Dividend Period but excluding the last day thereof) and the denominator of which
is 360, times (ii) 1/4 of 1%, times (iii) $50,000, times (iv) the sum of (A) the
aggregate number of AMPS placed by BD in the applicable Auction that were (x)
the subject of a Submitted Bid of an Existing Holder submitted by BD and
continued to be held as a result of such submission and (y) the subject of a
Submitted Bid of a Potential Holder submitted by BD and were purchased as a
result of such submission plus (B) the aggregate number of AMPS subject to valid
Hold Orders (determined in accordance with Paragraph 11 of the Articles
Supplementary) submitted to the Auction Agent by BD plus (C) the number of AMPS
deemed to be subject to Hold Orders by Existing Holders pursuant to Paragraph 11
of the Articles Supplementary that were acquired by such Existing Holders
through BD and (b) in the case of any Auction Date immediately preceding a Long
Term Dividend Period, that amount as mutually agreed upon by the Company and BD,
based on the selling concession that would be applicable to an underwriting of
fixed or variable rate preferred shares with a similar final maturity or
variable rate dividend period, at the commencement of such Long Term Dividend
Period.
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For purposes of subclause (a)(iv)(C) of the foregoing sentence, if any
Existing Holder who acquired shares of any series of AMPS through BD transfers
those shares to another Person other than pursuant to an Auction, then the
Broker-Dealer for the shares so transferred shall continue to be BD, provided,
however, that if the transfer was effected by, or if the transferee is, a
Broker-Dealer other than BD, then such Broker-Dealer shall be the Broker-Dealer
for such shares.
4. The Auction Agent.
4.1 Duties and Responsibilities.
(a) The Auction Agent is acting solely as agent for the Company
hereunder and owes no fiduciary duties to any other Person by reason of
this Agreement.
(b) The Auction Agent undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement, and no
implied covenants or obligations shall be read into this Agreement against
the Auction Agent.
(c) In the absence of bad faith or negligence on its part, the
Auction Agent shall not be liable for any action taken, suffered, or
omitted or for any error of judgment made by it in the performance of its
duties under this Agreement. The Auction Agent shall not be liable for any
error of judgment made in good faith unless the Auction Agent shall have
been negligent in ascertaining (or failing to ascertain) the pertinent
facts.
4.2 Rights of the Auction Agent.
(a) The Auction Agent may rely and shall be protected in acting or
refraining from acting upon any communication authorized by this Agreement
and upon any written instruction, notice, request, direction, consent,
report, certificate, share certificate or other instrument, paper or
document believed by it to be genuine. The Auction Agent shall not be
liable for acting upon any telephone communication authorized by this
Agreement which the Auction Agent believes in good faith to have been
given by the Company or by a Broker-Dealer. The Auction Agent may record
telephone communications with the Broker-Dealers.
(b) The Auction Agent may consult with counsel of its own choice,
and the advice of such counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon.
(c) The Auction Agent shall not be required to advance, expend or
risk its own funds or otherwise incur or become exposed to financial
liability in the performance of its duties hereunder.
(d) The Auction Agent may perform its duties and exercise its rights
hereunder either directly or by or through agents or attorneys.
4.3 Auction Agent's Disclaimer. The Auction Agent makes no representation
as to the validity or adequacy of this Agreement or the AMPS.
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5. Miscellaneous.
5.1 Termination. Any party may terminate this Agreement at any time upon
five days' prior notice to the other party; provided, however, that if BD is
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, neither BD nor the Auction
Agent may terminate this Agreement without first obtaining prior written consent
of the Company of such termination, which consent shall not be unreasonably
withheld.
5.2 Participant in Securities Depository; Payment of Dividends in Same-Day
Funds.
(a) BD is, and shall remain for the term of this Agreement, a member
of, or participant in, the Securities Depository (or an affiliate of such
a member or participant).
(b) BD represents that it (or if such BD does not act as Agent
Member, one of its affiliates) shall make all dividend payments on the
AMPS available in same-day funds on each Dividend Payment Date to
customers that use such BD or affiliate as Agent Member.
5.3 Agent Member. At the date hereof, BD is a participant of the
Securities Depository.
5.4 Communications. Except for (i) communications authorized to be made by
telephone pursuant to this Agreement or the Auction Procedures and (ii)
communications in connection with the Auctions (other than those expressly
required to be in writing), all notices, requests and other communications to
any party hereunder shall be in writing (including telecopy or similar writing)
and shall be given to such party, addressed to it, at its address or telecopy
number set forth below:
If to XX Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
addressed: Xxxxxxx Xxxxx World Headquarters
World Financial Center - Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention:
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
If to the Auction IBJ Xxxxxxxx Bank & Trust Company
Agent, addressed: Xxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Auction Window Subcellar 1
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
or such other address or telecopy number as such party may hereafter specify for
such purpose by notice to the other party.
Each such notice, request or communication shall be effective when delivered at
the address specified herein. Communications shall be given on behalf of BD by a
BD Officer and on behalf
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of the Auction Agent by an Authorized Officer. BD may record telephone
communications with the Auction Agent.
5.5 Entire Agreement. This Agreement contains the entire agreement between
the parties relating to the subject matter hereof, and there are no other
representations, endorsements, promises, agreements or understandings, oral,
written or inferred, between the parties relating to the subject matter hereof.
5.6 Benefits. Nothing in this Agreement, express or implied, shall give to
any person, other than the Company, the Auction Agent and BD and their
respective successors and assigns, any benefit of any legal or equitable right,
remedy or claim under this Agreement.
5.7 Amendments; Waiver.
(a) 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.
(b) Failure of either party to this Agreement to exercise any right
or remedy hereunder in the event of a breach of this Agreement by the
other party shall not constitute a waiver of any such right or remedy with
respect to any subsequent breach.
5.8 Successors and Assigns. This Agreement shall be binding upon, inure to
the benefit of, and be enforceable by, the respective successors and permitted
assigns of each of BD and the Auction Agent. This Agreement may not be assigned
by either party hereto absent the prior written consent of the other party;
provided, however, that this Agreement may be assigned by the Auction Agent to a
successor Auction Agent selected by the Company without the consent of BD.
5.9 Severability. If any clause, provision or section of this Agreement
shall be ruled invalid or unenforceable by any court of competent jurisdiction,
the invalidity or unenforceability of such clause, provision or section shall
not affect any remaining clause, provision or section hereof.
5.10 Execution in Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
6. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
and to be performed in said State.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the date first above written.
IBJ XXXXXXXX BANK & TRUST COMPANY
By: _____________________________________
Title: Assistant Vice President
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By: _____________________________________
Title: Vice President
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EXHIBIT A
TO BE SUBMITTED TO YOUR BROKER-DEALER WHO WILL THEN DELIVER
COPIES ON YOUR BEHALF TO THE RESPECTIVE TRUST COMPANY OR
REMARKETING AGENT. MASTER PURCHASER'S LETTER
Relating to
Securities Involving Rate Settings
Through Auctions or Remarketings
THE COMPANY
A REMARKETING AGENT
THE TRUST COMPANY
A BROKER-DEALER
AN AGENT MEMBER
OTHER PERSONS
Dear Sirs:
1. This letter is designed to apply to publicly or privately offered debt
or equity securities ("Securities") of any issuer ("Company") which are
described in any final prospectus or other offering materials relating to such
Securities as the same may be amended or supplemented (collectively, with
respect to the particular Securities concerned, the "Prospectus") and which
involve periodic rate settings through auctions ("Auctions") or remarketing
procedures ("Remarketings"). This letter shall be for the benefit of any Company
and of any trust company, auction agent, paying agent (collectively, "trust
company"), remarketing agent, broker-dealer, agent member, securities depository
or other interested person in connection with any Securities and related
Auctions or Remarketings (it being understood that such persons may be required
to execute specified agreements and nothing herein shall alter such
requirements). The terminology used herein is intended to be general in its
application and not to exclude any Securities in respect of which (in the
Prospectus or otherwise) alternative terminology is used.
2. We may from time to time offer to purchase, purchase, offer to sell
and/or sell Securities of any Company as described in the Prospectus relating
thereto. We agree that this letter shall apply to all such purchases, sales and
offers and to Securities owned by us. We understand that the dividend/interest
rate on Securities may be based from time to time on the results of Auctions or
Remarketings as set forth in the Prospectus.
3. We agree that any bid or sell order placed by us in an Auction or a
Remarketing shall constitute an irrevocable offer (except as otherwise described
in the Prospectus) by us to purchase or sell the Securities subject to such bid
or sell order, or such lesser amount of Securities as we shall be required to
sell or purchase as a result of such Auction or Remarketing, at the applicable
price, all as set forth in the Prospectus, and that if we fail to place a bid or
sell order with respect to Securities owned by us with a broker-dealer on any
Auction or Remarketing date, or a broker-dealer to which we communicate a bid or
sell order fails to submit such bid or sell order to the trust company or
remarketing agent concerned, we shall be deemed to have placed a hold order with
respect to such Securities as described in the Prospectus. We
A-1
authorize any broker-dealer that submits a bid or sell order as our agent in
Auctions or Remarketing to execute contracts for the sale of Securities covered
by such bid or sell order. We recognize that the payment by such broker-dealer
for Securities purchased on our behalf shall not relieve us of any liability to
such broker-dealer for payment for such Securities.
4. We understand that in a Remarketing, the dividend or interest rate or
rates on the Securities and the allocation of Securities tendered for sale
between dividend or interest periods of different lengths will be based from
time to time on the determinations of one or more remarketing agents, and we
agree to be conclusively bound by such determinations. We further agree to the
payment of different dividend or interest races to different holder of
Securities depending on the length of the dividend or interest period elected by
such holders. We agree that any notice given by us to a remarketing agent (or to
a broker-dealer for transmission to a remarketing agent) of our desire to tender
Securities in a Remarketing shall constitute an irrevocable (except to the
limited extent set forth in the Prospectus) offer by us to sell the Securities
specified in such notice, or such lesser number of Securities as we shall be
required to sell as a result of such Remarketing in accordance with the terms
set forth in the Prospectus, and we authorize the remarketing agent to sell,
transfer or otherwise dispose of such Securities as set forth in the Prospectus.
5. We agree that, during the applicable period as described in the
Prospectus, dispositions of Securities can be made only in the denominations set
forth in the Prospectus and we will sell, transfer or otherwise dispose of any
Securities held by us from time to time only pursuant to a bid or sell order
placed in an Auction, in a Remarketing. to or through a broker-dealer or, when
permitted in the Prospectus, to a person that has signed and delivered to the
applicable trust company or a remarketing agent a letter substantially in the
form of this letter (or other applicable purchaser's, letter) provided that in
the case of all transfers other than pursuant to Auctions or Remarketings we or
our broker-dealer or our agent member shall advise such trust company or a
remarketing agent of such transfer. We understand that a restrictive legend will
be placed on certificates representing the Securities and stop-transfer
instructions will be issued to the transfer agent and or registrar all as set
forth in the Prospectus.
6. We agree that, during the applicable period as described in the
Prospectus, ownership of Securities shall be represented by one or more global
certificates registered in the name of the applicable securities depository or
its nominee that we will not be entitled to receive any certificate representing
the Securities and that our ownership of any Securities will be maintained in
book entry form by the securities depository for the account of our agent
member, which in turn will maintain records of our beneficial ownership. We
authorize and instruct our agent member to disclose to the applicable trust
company or remarketing agent such information concerning our beneficial
ownership of Securities as such trust company or remarketing agent shall
request.
7. We acknowledge that partial deliveries of Securities purchased in
Auctions or Remarketings may be made to us and such deliveries shall constitute
good delivery as set forth in the Prospectus.
8. This letter is not a commitment by us to purchase any Securities.
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9. This letter supersedes any prior-dated version of this master
purchaser's letter, and supplements any prior or post-dated purchaser's letter
specific to particular Securities, and this letter may only be revoked by a
signed writing delivered to the original recipients hereof.
10. The descriptions of Auction or Remarketing procedures set forth in
each applicable Prospectus are incorporated by reference herein and in case of
any conflict between this letter, any purchaser's letter specific to particular
Securities and any such description, such description shall control.
11. Any xerographic or other copy of this letter shall be deemed of equal
effect as a signed original.
12. Our agent member of The Depository Trust Company currently is
____________.
13. Our personnel authorized to place orders with broker-dealers for the
purposes set forth in the Prospectus in Auctions or Remarketings currently
is/are , telephone number ( ) .
14. Our taxpayer identification number is __________.
15. In the case of each offer to purchase, purchase, offer to sell or sale
by us of Securities not registered under the Securities Act of 1933, as amended
(the "Act"), we represent and agree as follows:
A. We understand and expressly acknowledge that the Securities have
not been and will not be registered under the Act and, accordingly, that
the Securities may not be reoffered, resold or otherwise pledged,
hypothecated or transferred unless an applicable exemption from the
registration requirements of the Act is available.
B. We hereby confirm that any purchase of Securities made by us will
be for our own account, or for the account of one or more parties for
which we are acting as trustee or agent with complete investment
discretion and with authority to bind such parties, and not with a view to
any public resale or distribution thereof. We and each other party for
which we are acting which will acquire Securities will be "accredited
investors" within the meaning of Regulation D under the Act with respect
to the Securities to be purchased by us or such party, as the case may be,
will have previously invested in similar types of instruments and will be
able and prepared to bear the economic risk of investing in and holding
such Securities.
C. We acknowledge that prior to purchasing any Securities we shall
have received a Prospectus (or private placement memorandum) with respect
thereto and acknowledge that we will have had access to such financial and
other information, and have been afforded the opportunity to ask such
questions of representatives of the Company and receive answers thereto,
as we deem necessary in connection with our decision to purchase
Securities.
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D. We recognize that the Company and broker-dealers will rely upon
the truth and accuracy of the foregoing investment representations and
agreements, and we agree that each of our purchases of Securities now or
in the future shall be deemed to constitute our concurrence in all of the
foregoing which shall be binding on us and each party for which we are
acting as set forth in Subparagraph B above.
-------------------------------------------
(Name of Purchaser)
By
------------------------------------------
Name:
Title:
Dated:
----------------------
Mailing Address of Purchaser
----------------------------
----------------------------
----------------------------
A-4
EXHIBIT B
SETTLEMENT PROCEDURES
Capitalized terms used herein shall have the respective meanings specified
in the Articles Supplementary.
(a) On each Auction Date, the Auction Agent shall notify by telephone or
through the Auction Agent's Processing System the Broker-Dealers that
participated in the Auction held on such Auction Date and submitted an Order on
behalf of any Existing Holder or Potential Holder of:
(i) the Applicable Rate fixed for the next succeeding Dividend
Period;
(ii) whether Sufficient Clearing Bids existed for the determination
of the Applicable Rate;
(iii) if such Broker-Dealer (a "Seller's Broker-Dealer") submitted a
Bid or Sell Order on behalf of an Existing Holder, the number of shares,
if any, of Preferred Shares to be sold by such Existing Holder;
(iv) if such Broker-Dealer (a "Buyer's Broker-Dealer") submitted a
Bid on behalf of a Potential Holder, the number of shares, if any, of
Preferred Shares to be purchased by such Potential Holder;
(v) if the aggregate number of Preferred Shares to be sold by all
Existing Holder on whose behalf such Broker-Dealer submitted a Bid or a
Sell Order exceeds the aggregate number of Preferred Shares to be
purchased by all potential Holders on whose behalf such Broker-Dealer
submitted a Bid, the name or names of one or more Buyer's Broker-Dealer
(and the name of the Agent Member, if any, of each such Buyer's
Broker-Dealer) acting for one or more purchasers of such excess number of
Preferred Shares and the number of such shares to he purchased from one or
more Existing Holders on whose behalf such Broker-Dealer acted by one or
more Potential Holders on whose behalf each of such Buyer's Broker-Dealer
acted;
(vi) if the aggregate number of Preferred Shares to be purchased by
all Potential Holders on whose behalf such Broker-Dealer submitted a Bid
exceeds the aggregate number of Preferred Shares to be sold by all
Existing Holders on whose behalf such Broker-Dealer submitted a Bid or a
Sell Order, the name or names of one or more Seller's Broker-Dealers (and
the name of the Agent Member, if any, of each such Seller's Broker-Dealer)
acting for one or more sellers of such excess number of Preferred Shares
and the number of such shares to be sold to one or more Potential Holders
on whose behalf such Broker-Dealer acted by one or more Existing Holders
on whose behalf each of such Seller's Broker-Dealer acted; and
(vii) the Auction Date of the next succeeding Auction with respect
to the Preferred Shares;
B-1
(b) On each Auction Date, each Broker-Dealer that submitted an Order on
behalf of any Existing Holder or Potential Holder shall:
(i) in the case of a Broker-Dealer that is a Buyer's Broker-Dealer,
instruct each Potential Holder on whose behalf such Broker-Dealer
submitted a Bid that was accepted, in whole or in part, to instruct such
Potential Holder's Agent Member to pay to such Broker-Dealer (or its Agent
Member) through the Securities Depository the amount necessary to purchase
the number of Preferred Shares to be purchased pursuant to such Bid
against receipt of such shares and advise such Potential Holder of the
Applicable Rate for the next succeeding Dividend Period;
(ii) in the case of a Broker-Dealer that is a Seller's
Broker-Dealer, instruct each Existing Holder on whose behalf such
Broker-Dealer submitted a Sell Order that was accepted, in whole or in
part, or a Bid that was accepted, in whole or in part, to instruct such
Existing Holder's Agent Member to deliver to such Broker-Dealer (or its
Agent Member) through the Securities Depository the number of Preferred
Shares to be sold pursuant to such Order against payment therefor and
advise any such Existing Holder that will continue to hold Preferred
Shares of the Applicable Rate for the next succeeding Dividend Period;
(iii) advise each Existing Holder on whose behalf such Broker-Dealer
submitted a Hold Order of the Applicable Rate for the next succeeding
Dividend Period;
(iv) advise each Existing Holder on whose behalf such Broker-Dealer
submitted an Order of the Auction Date for the next succeeding Auction;
and
(v) advise each Potential Holder on whose behalf such Broker-Dealer
submitted a Bid that was accepted, in whole or in part, of the Auction
Date for the next succeeding Auction.
(c) On the basis of the information provided to it pursuant to (a) above,
each Broker-Dealer that submitted a Bid or a Sell Order on behalf of a Potential
Holder or an Existing Holder shall, in such manner and at such time or times as
in its sole discretion it may determine, allocated any funds received by it
pursuant to (b)(i) above and any Preferred Shares received by it pursuant to
(b)(ii) above among the Potential Holders, if any, on whose behalf such
Broker-Dealer submitted Bids, the Existing Holders, if any, on whose behalf such
Broker-Dealer submitted Bids that were accepted or Sell Orders, and any
Broker-Dealer or Broker-Dealers identified to it by the Auction Agent pursuant
to (a)(v) or (a)(vi) above.
(d) On each Auction Date:
(i) each Potential Holder and Existing Holder shall instruct its
Agent Member as provided in (b)(i) or (ii) above, as the case may be.
(ii) each Seller's Broker-Dealer which is not an Agent Member of the
Securities Depository shall instruct its Agent Member to (A) pay through
the Securities Depository to the Agent Member of the Existing Holder
delivering shares to such Broker-Dealer pursuant to (b)(ii) above the
amount necessary to purchase such shares against receipt of such shares,
and (B) deliver such shares through the Securities Depository to a Buyer's
Broker-Dealer (or its Agent Member) identified to such Sellers
Broker-Dealer pursuant to (a)(v) above against payment therefor; and
(iii) each Buyers Broker-Dealer which is not an Agent Member of the
Securities Depository, shall instruct its Agent Member to (A) pay through
the Securities Depository to a Seller's Broker-Dealer (or its Agent
Member) identified pursuant to (a)(vi) above the amount necessary to
purchase the shares to be purchased pursuant to (b)(i) above against
receipt of such shares, and (B) deliver such shares through the Securities
B-2
Depository to the Agent Member of the purchaser thereof against payment
therefor.
(e) On the day after the Auction Date:
(i) each Bidder's Agent Member referred to in (d)(i) above shall
instruct the Securities Depository to execute the transactions described
under (b)(i) or (ii) above, and the Securities Depository shall execute
such transactions:
(ii) each Seller's Broker-Dealer or its Agent Member shall instruct
the Securities Depository to execute the transactions described in (d)(ii)
above, and the Securities Depository shall execute such transactions; and
(iii) each Buyer's Broker-Dealer or its Agent Member shall, instruct
the Securities Depository to execute the transactions described in
(d)(iii) above, and the Securities Depository shall execute such
transactions.
(f) If an Existing Holder selling Preferred Shares in an Auction fails to
deliver such shares (by authorized book-entry), a Broker-Dealer may deliver to
the Potential Holder on behalf of which it submitted a Bid that was accepted a
number of whole Preferred Shares that is less than the number of shares that
otherwise was to be purchased by such Potential Holder. In such event, the
number of Preferred Shares to be so delivered shall be determined solely by such
Broker-Dealer. Delivery of such lesser number of shares shall constitute good
delivery. Notwithstanding the foregoing terms of this paragraph (f), any
delivery or non-delivery of shares which shall represent any departure from the
results of an Auction, as determined by the Auction Agent, shall be of no effect
unless and until the Auction Agent shall have been notified of such delivery or
non-delivery in accordance with the provisions of the Auction Agent Agreement
and the Broker-Dealer Agreements.
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EXHIBIT C
IBJ XXXXXXXX BANK & TRUST COMPANY
AUCTION BID FORM
Submit To: IBJ Xxxxxxxx Bank & Trust Co. Issue________________________
Securities Transfer Department Series_______________________
One State Street Auction Date_________________
Xxx Xxxx, Xxx Xxxx 00000
Telephone (000) 000-0000
Attention: Auction Window Facsimile (000) 000-0000
The undersigned Broker-Dealer submits the following Order on behalf of the
Bidder listed below:
Name of Bidder:_____________________
EXISTING HOLDER
Shares now held HOLD_________________________
BID at rate of ______________
SELL ________________________
POTENTIAL HOLDER
# of shares bid _____________
BID at rate of ______________
Notes:
(1) If submitting more than one Bid for one Bidder, use additional Auction Bid
Forms.
(2) If one or more Bids covering in the aggregate more than the number of
outstanding shares held by any Existing Holder are submitted, such Bids
shall be considered valid in the order of priority set forth in the
Auction Procedures on the above issue.
(3) A Hold or Sell may be placed only by an Existing Holder covering a number
of shares not greater than the number of shares currently held.
(4) Potential Holders may make only Bids, each of which must specify a rate.
If more than one Bid is submitted on behalf of any Potential Holder, each
Bid submitted shall be a separate Bid with the rate specified.
(5) Bids may contain no more than three figures to the right of the decimal
point (.001 of 1%). Fractions will not accepted.
NAME OF BROKER-DEALER __________________________
Authorized Signature __________________________
EXHIBIT D
(To be used only for transfers made other than pursuant to an Auction).
TRANSFER FORM
Re: MuniYield Fund, Inc.
Auction Market Preferred Stock, Series ______ ("AMPS")
We are (check one):
|_| the Existing Holder named below;
|_| the Broker-Dealer for such Existing Holder; or
|_| the Agent Member for such Existing Holder.
We hereby notify you that such Existing Holder has transferred
_____ shares of Series _____ AMPS to ____________________.
------------------------------------
(Name of Existing Holder)
------------------------------------
(Name of Broker-Dealer)
------------------------------------
(Name of Agent Member)
By:
------------------------------------
Name:
Title:
EXHIBIT E
(To be used only for failures to deliver
AMPS sold pursuant to an Auction)
NOTICE OF A FAILURE TO DELIVER
Complete either I or II
I. We are a Broker-Dealer for ______________________________ (the
"Purchaser"), which purchased _____ shares of Series _______ AMPS of
MuniYield Fund, Inc. in the Auction held on _______________________
from the seller of such shares.
II. We are a Broker-Dealer for ___________________________ (the
"Seller"), which sold ____ shares of Series _____ AMPS of MuniYield
Fund, Inc. in the Auction held on _____________________________ to
the Purchaser of such shares.
We hereby notify you that (check one) --
____________ the Seller failed to deliver such shares to the
Purchaser
____________ the Purchaser failed to make payment to the Seller upon
delivery of such shares
Name:
-----------------------------------
Name of Broker-Dealer)
By:
-------------------------------------
Name:
Title:
