Exhibit 99.(k)(vi)
SECURITY AGREEMENT
Xxx Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx February __, 2004
(Banking Office)
FOR VALUE RECEIVED, and in order to induce THE BANK OF NEW YORK (the
"BANK"), in its discretion, to make loans or otherwise extend credit at any
time, and from time to time to, or at the request of, [NAME OF TRUSTEE], AS
TRUSTEE (the "DEBTOR") of DREMAN/CLAYMORE DIVIDEND & INCOME FUND created
under Agreement and Declaration of Trust dated as of October 20, 2003 (the
"TRUST"), whether the loans or credit so extended shall be absolute or
contingent, the Debtor grants to the Bank, as security for all present or
future obligations of the Debtor to it under the Master Promissory Note
executed by the Debtor in favor of the Bank in the original principal of
$385,000,000, and dated the date hereof, as amended, modified or restated
from time to time, whether due or to become due, secured or unsecured,
absolute or contingent, joint and/or several, and howsoever or whensoever
acquired by the Bank including interest accruing thereon before or after the
commencement of any insolvency, bankruptcy or reorganization proceeding of
the Debtor whether or not such interest is an allowable claim in any
proceeding and irrespective of the discharge or release of the Debtor in such
proceeding (all of which are referred to collectively as the "OBLIGATIONS"),
a security interest in and a lien upon all personal property of the Debtor or
in which the Debtor has an interest whether now or hereafter existing or now
owned or hereafter acquired and whether or not subject to the Uniform
Commercial Code (the "CODE"), all of the foregoing only to the extent
specified in Schedule A hereto, and also including all interest, dividends
and other distributions thereon paid and payable in cash or in property, and
all replacements and substitutions for, and all accessions and additions to,
and all products and proceeds of, all of the foregoing (all of which are
referred to as the "COLLATERAL").
The Debtor agrees to deliver to the Bank whenever called for by it such
additional collateral security of a kind and of a market value satisfactory
to the Bank, so that there will, at all times, be with the Bank a margin of
security for the payment of all Obligations which shall be satisfactory to
it. The Debtor hereby authorizes the Bank in its discretion, whether or not
the Collateral is deemed by it adequate, to appropriate and apply upon any of
the Obligations not paid when due, any of such property of the Debtor and to
charge any of the Obligations not paid when due against any balance of any
account standing to the credit of the Debtor on the books of the Bank.
Upon failure of the Debtor to pay any Obligation when due, in accordance
with its terms, the Bank shall have, in addition to all other rights and
remedies allowed by law, the rights and remedies of a secured party under the
Code and, without limiting the generality of the foregoing, the Bank may
immediately, without demand of performance and without notice of intention to
sell or otherwise dispose of or of time or place of sale or other disposition
or of redemption or other notice or demand whatsoever to the Debtor, all of
which, to the extent permitted by law, are hereby expressly waived, and
without advertisement, sell at public or private sale, grant options to
purchase or otherwise realize upon, in the State of New York, or elsewhere,
the whole or from time to time any part of the Collateral upon which the Bank
shall have a security interest or lien as aforesaid, or any interest which
the Debtor may have therein. After deducting from the
proceeds of any such sale or other disposition of the Collateral all expenses
(including, but not limited to, reasonable attorneys' fees and expenses and
other expenses as set forth below), the Bank shall apply the residue of such
proceeds toward the payment of any of the Obligations, in such order as the
Bank shall elect, the Debtor remaining liable for any deficiency, plus
interest thereon, remaining unpaid after such application. If notice of any
sale or other disposition is required by law to be given, the Debtor hereby
agrees that a notice sent at least five days before the time of any intended
public sale or of the time after which any private sale or other disposition
of the Collateral is to be made, shall be reasonable notice of such sale or
other disposition.
At any such sale or other disposition the Bank or any other person
designated by the Bank may itself purchase the whole or any part of the
Collateral sold, free from any right of redemption on the part of the Debtor,
which right, to the extent permitted by law, is hereby waived and released.
The Bank may, without any notice to the Debtor, in its discretion,
subsequent to a default under the Obligations, in its name or in the name of
the Debtor, demand, xxx for, collect and receive any money or property at any
time due, payable or receivable on or on account of or in exchange for, and
may compromise, settle or extend the time of payment of, any of the demands
or obligations represented by any of the Collateral, and may also exchange
any of the Collateral for other property upon the reorganization,
recapitalization or other readjustment of the issuer, maker or other person
who is obligated on or otherwise has liabilities with respect to the
Collateral, and in connection therewith may deposit any of the Collateral
with any committee or depositary upon such terms as the Bank may in its
reasonable discretion deem appropriate, and the Debtor does hereby constitute
and appoint the Bank the Debtor's true and lawful attorney to compromise,
settle or extend payment of said demands or obligations and exchange such
Collateral as the Debtor might or could do personally; all without liability
or responsibility for action herein authorized and taken or not taken in good
faith. The Bank is entitled at any time in its discretion to notify the
obligor on any instrument included in the Collateral to make payment to it
and hold same as Collateral, regardless of whether or not the Debtor had been
previously making collections on the Collateral, and the Bank may take
control of any proceeds of any of the Collateral and hold same as Collateral.
Upon request of the Bank, the Debtor shall receive and hold all proceeds of
the Collateral in trust for the Bank and not commingle any collections with
any of its own funds and immediately deliver such collections to the Bank.
The Debtor agrees that the Collateral secures, and further agrees to pay
on demand, all expenses (including, but not limited to, reasonable attorneys'
fees and out of pocket expenses and costs of any insurance and payment of
taxes or other charges) of, or incidental to, the custody, care, sale or
collection of, or realization upon, any of the Collateral or in any way
relating to the enforcement or protection of the rights of the Bank
hereunder, whether or not litigation is commenced.
The Debtor agrees to xxxx its books and records as the Bank shall request
in order to reflect the rights of the Bank granted herein. The Bank may,
upon 20 days prior written notice to the Debtor, sell, assign or transfer any
of the Obligations and the Bank's rights and duties hereunder, and may
deliver the Collateral, or any part thereof, to the assignee or transferee of
any of the Obligations, who shall become vested with all the rights,
remedies, powers, security
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interests and liens herein given to the Bank with respect thereto; and the
Bank shall thereafter be relieved and fully discharged from any liability or
responsibility in the premises.
The Bank may, without any notice to the Debtor, in its discretion,
transfer, or cause to be transferred, all or any part of the Collateral to its
name, or to the name of its nominee, subsequent to a default under the
Obligations, vote the Collateral so transferred and receive income and make
or receive collections, including money, thereon and hold said income and
collections as Collateral or apply said income and collections to any of the
Obligations past due, the manner and distribution of the application to be
made as the Bank shall elect.
Calls for Collateral, demand for payment or notice to the Debtor may be
given by leaving same at the address given below or any other address
hereafter filed with the Bank, or by mailing same to such address with the
same effect as if delivered personally. Such notice given in the manner
herein provided shall be effective whether or not received by the Debtor.
The Debtor agrees not to change its name, any of its places of business,
remove any records of the Debtor relating to any of the Collateral or move
any of the Collateral without giving the Bank thirty days' prior written
notice.
With respect to the Collateral, the Bank shall be under no duty to
send notices, perform services, exercise any rights of collection,
enforcement, conversion or exchange, vote, pay for insurance, taxes or other
charges or take any action of any kind in connection with the management
thereof and its only duty with respect thereto shall be to use reasonable
care in its custody and preservation while in its possession, which shall not
include any steps necessary to preserve, obtain, secure or acquire rights or
property against or from any parties.
The Debtor authorizes the Bank, at the Debtor's expense, to file one or
more financing statements and amendments thereto to perfect the security
interests granted herein, without the Debtor's signature thereon, and to take
all actions necessary to perfect (whether by filing, possession, control or
otherwise) its security interest in the Collateral under any applicable law
or regulation, and the Debtor agrees to do, file, record, make, execute and
deliver all such acts, deeds, things, agreements, notices, instruments and
financing statements as the Bank may request in order to perfect and enforce
the rights of the Bank herein.
If at any time subsequent to a default under the Obligations it is
necessary in the opinion of counsel to the Bank that any or all of the
securities held as Collateral (the "PLEDGED SECURITIES") be registered under
the Securities Act of 1933, as amended, or that an indenture with respect
thereto be qualified under the Trust Indenture Act of 1939, as amended, in
order to permit the sale or other disposition of the Pledged Securities, the
Debtor shall at the Bank's request and at the expense of the Debtor use the
commercially reasonable efforts of the Debtor promptly to cause the
registration of the Pledged Securities or the qualification of such indenture
and to continue such registration or qualification under such laws and in
such jurisdictions and for as long as deemed appropriate by the Bank.
Upon payment in full of all of the Obligations and at the request of the
Debtor, the security interest granted hereby shall terminate hereunder and
all rights to the Collateral shall revert and be deemed reassigned to the
Debtor. Upon any such termination, the Bank shall, at the Debtor's request
and expense, execute and deliver to the Debtor such documents and take
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such other action as the Debtor shall reasonably request to evidence such
termination, reversion and/or reassignment, without representation or
warranty.
This agreement may not be amended, or compliance with its terms waived,
orally or by course of dealing, but only by a writing signed by an authorized
officer of the Bank.
No failure on the part of the Bank to exercise, and no delay in
exercising, any right, remedy or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise by the Bank of any right,
remedy or power hereunder preclude any other or future exercise thereof or
the exercise of any other right, remedy or power.
Each and every right, remedy and power hereby granted to the Bank or
allowed it by law or other agreement shall be cumulative and not exclusive of
any other right, remedy or power, and may be exercised by the Bank at any time
and from time to time.
This agreement may be assigned by the Bank and its benefits shall inure to
the successors, indorsees and assigns of the Bank.
This agreement shall be construed and interpreted, and all rights and
obligations hereunder shall be determined, in accordance with the laws of the
State of New York without regard to principles of conflict of laws.
Unless otherwise defined or the text otherwise requires, all terms used
herein shall have the meanings specified in the Code.
Every provision of this agreement is intended to be severable; if any term
or provision of this agreement shall be invalid, illegal or unenforceable for
any reason whatsoever, the validity, legality and enforceability of the
remaining provisions hereof shall not in any way be affected or impaired
thereby.
Any notice to the Bank shall be effective only upon receipt by the Bank and
if directed to the Bank at its banking office set forth above or any other
address hereafter specified by written notice from the Bank to the Debtor.
The Debtor represents and warrants that at the time the Collateral becomes
subject to the Bank's security interest, the Debtor shall be the sole owner
of and fully authorized and able to sell, transfer, pledge and/or grant a
first priority security interest in the Collateral to the Bank and the
Collateral shall be free and clear of all other claims, liens, charges,
security interests and encumbrances except as permitted in writing by the
Bank. The Debtor represents and warrants to the Bank that any information
furnished to the Bank by the Debtor in writing regarding the Collateral is
true and correct on the date hereof and is complete in all material respects.
The Debtor represents and warrants that the Trust is a statutory trust duly
organized, validly existing and in good standing under the laws of the state
of its organization and is duly qualified to do business in the State of New
York; that the execution, delivery and performance of this agreement are
within the Debtor's powers under the Trust and have been duly authorized by
all necessary action; and that each person executing this agreement has the
authority to execute and deliver this agreement on behalf of the Debtor.
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THE DEBTOR SUBMITS TO THE JURISDICTION OF STATE AND FEDERAL COURTS LOCATED
IN THE CITY AND STATE OF NEW YORK IN PERSONAM AND AGREES THAT ALL ACTIONS AND
PROCEEDINGS RELATING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT SHALL BE
LITIGATED ONLY IN SAID COURTS OR IN COURTS LOCATED ELSEWHERE AS THE BANK MAY
SELECT AND THAT SUCH COURTS ARE CONVENIENT FORUMS AND WAIVES PERSONAL SERVICE
UPON IT AND CONSENTS TO SERVICE OF PROCESS OUT OF SAID COURTS BY MAILING A
COPY THEREOF TO IT BY REGISTERED OR CERTIFIED MAIL.
THE DEBTOR AND THE BANK WAIVE THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BASED UPON, ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
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[Insert Name of Trustee], AS TRUSTEE
under Dreman/Claymore Dividend &
Income Fund created under Agreement
and Declaration of Trust dated as of
October 20, 2003
ADDRESS OF DEBTOR:
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[SCHEDULE A ON THE FOLLOWING]
PAGE MUST BE COMPLETED]
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SCHEDULE A
TO
SECURITY AGREEMENT
EXECUTED BY
[INSERT NAME OF TRUSTEE], AS TRUSTEE UNDER
DREMAN/CLAYMORE DIVIDEND & INCOME FUND CREATED UNDER
AGREEMENT AND DECLARATION OF TRUST DATED AS OF OCTOBER 20, 2003
Property specifically included as "Collateral" for purposes of the within
Security Agreement:
All of the Debtor's right, title and interest in and to the following
safekeeping and/or custody account(s) and any demand deposit account(s)
established in connection with such safekeeping and/or custody account(s)
(together with any successor account(s), the "ACCOUNT(S)"):
Custody account in the name of DREMAN/CLAYMORE DIVIDEND & INCOME FUND
maintained at the Bank and designated as account number [ ];
all property from time to time held in or credited to the Account(s), whether
now held or hereafter acquired and transferred into or credited to the
Account(s), including, without limitation, all monies, bills, bonds, notes,
obligations, securities, commercial paper, instruments or other investment
property and financial assets of any nature held in or credited to the
Account(s), together with all payments and distributions now or hereafter
made thereon (whether constituting principal, interest or dividends and
whether payable in cash or property); all sums now or hereafter deposited in,
and all sums due or to become due on (whether as interest, dividends or
otherwise), the Account(s); all rights (contractual or otherwise) now or
hereafter arising under, connected with or in any way related to the
foregoing items of Collateral including all securities entitlements with
respect thereto; all claims (including the right to xxx or otherwise recover
such claims) against third parties now or hereafter arising under, connected
with or in any way related to the foregoing items of Collateral; and all
additions thereto and all substitutions, exchanges and replacements therefor,
and all products and proceeds thereof.
