FORM OF BROKER-DEALER AGREEMENT
This Broker-Dealer Agreement dated as of January __, 2005, is between
Deutsche Bank Trust Company Americas (the "Auction Agent") (not in its
individual capacity, but solely as agent of Energy Income and Growth Fund (the
"Fund")), pursuant to authority granted to it in the Auction Agency Agreement
between the Fund and the Auction Agent dated as of January __, 2005 (the
"Auction Agency Agreement") and _______ (together with its successors and
assigns, the "Broker-Dealer").
The Fund proposes to issue [____________] aggregate principal amount of
Series ___ Energy Notes (the "Energy Notes"), authorized by, and subject to the
terms and conditions of the Supplemental Indenture of Trust by and between the
Fund and Deutsche Bank Trust Company Americas, in its capacity as trustee (the
"Trustee"), dated January __, 2005 (the "Supplemental Indenture"), which
supplements the Indenture dated January __, 2005 by and between the Fund and the
Trustee.
The Supplemental Indenture provides that for each Rate Period of
outstanding series of Energy Notes following the initial Rate Period, the
Applicable Rate for each series of Energy Notes shall be equal to the rate per
annum that results from an Auction for outstanding notes of each series of
Energy Notes. The Board of Trustees of the Fund has adopted resolutions
appointing Deutsche Bank Trust Company Americas as Auction Agent for purposes of
the Auction Procedures, and pursuant to Section 2.5 of the Auction Agency
Agreement, the Fund 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.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the Auction Agent and Broker-Dealer agree as
follows:
I. DEFINITIONS AND RULES OF CONSTRUCTION.
1.1 Terms Defined by Reference to the Supplemental Indenture.
Capitalized terms used herein but not defined herein shall have the
respective meanings specified in the Supplemental Indenture.
1.2 Terms Defined Herein.
As used herein, the following terms shall have the following meanings,
unless the context otherwise requires:
(a) "Auction" shall have the meaning specified in Section 2.1 of the
Auction Agency Agreement.
(b) "Auction Procedures" shall mean the procedures as from time to
time in effect for conducting Auctions that are set forth in Appendix A of the
Supplemental Indenture.
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(c) "Authorized Officer" shall mean each Vice President, Assistant
Vice President and Assistant Treasurer of the Auction Agent and every other
officer or employee of the Auction Agent designated as an "Authorized Officer"
for purposes hereof in a written communication from the Auction Agent to the
Fund.
(d) "Broker-Dealer Officer" shall mean each officer or employee of a
Broker-Dealer designated as a "Broker-Dealer Officer" for purposes of this
Agreement in a written communication to the Auction Agent.
(e) "Broker-Dealer Agreement" shall mean this Agreement and any
substantially similar agreement between the Auction Agent and a Broker-Dealer.
(f) "Supplemental Indenture" shall mean the Supplemental Indenture of
Trust by and between the Fund and Deutsche Bank Trust Company Americas, dated
January __, 2005, as amended or supplemented.
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.
(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.
II. NOTIFICATION OF RATE PERIOD.
The provisions contained in Section 2.04 of the Supplemental Indenture
concerning the notification of a Special Rate Period will be followed by the
Auction Agent and Broker-Dealer, 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 set forth
fully herein.
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III. THE AUCTION.
3.1 Purpose; Incorporation by Reference of Auction 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 the Energy Notes for the next Rate Period.
(b) All of the provisions contained in the Auction 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 set forth
fully herein. In the case of any conflict between the terms of any document
incorporated herein by reference and the terms hereof, the terms in this
Agreement shall control.
(c) Broker-Dealer agrees to act as, and assumes the obligations of and
limitations and restrictions placed upon, a Broker-Dealer under this Agreement.
Broker-Dealer understands that other persons meeting the requirements specified
in the definition of "Broker-Dealer" contained in Section 1.01 of the
Supplemental Indenture may execute a Broker-Dealer Agreement and participate as
Broker-Dealers in Auctions.
(d) Broker-Dealer and other Broker-Dealers may participate in Auctions
for their own accounts. However, the Fund, by notice to Broker-Dealer and all
other Broker Dealers, may prohibit all 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 the Energy
Notes, the Auction Agent shall advise Broker-Dealer 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 paragraph
(a) of the settlement procedures set forth on Exhibit A hereto (the "Settlement
Procedures"), the Auction Agent, by such means as the Auction Agent reasonably
deems practicable, shall give notice of such change to Broker-Dealer 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, Broker-Dealer promptly shall notify customers of
Broker-Dealer that Broker-Dealer believes are Beneficial Owners of Energy Notes
of such change in the Auction Date.
(c) The Auction Agent from time to time may request Broker-Dealer to
provide it with a list of the respective customers Broker-Dealer believes are
Beneficial Owners of Energy Notes. Broker-Dealer 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
Fund; 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. Notwithstanding the foregoing, the Auction
Agent reserves the right and is authorized to disclose any such information if
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(i) it is ordered to do so by a court of competent jurisdiction or a regulatory
body, judicial or quasi-judicial agency or authority having the authority to
compel such disclosure or (ii) it is advised by its counsel that its failure to
do so would be unlawful. In the event that the Auction Agent is required to
disclose information in accordance with the foregoing sentence, it shall provide
written notice of such requirement to Broker-Dealer as promptly as practicable.
The Auction Agent shall transmit any list of customers Broker-Dealer believes
are Beneficial Owners of Energy Notes and information related thereto only to
its officers, employees, agents or representatives who need to know such
information for the purposes of acting in accordance with this Agreement, and
the Auction Agent 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.
3.3 Auction Schedule; Method of Submission of Orders.
(a) The Fund and the Auction Agent shall conduct Auctions for the
Energy Notes 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 Fund, which
consent shall not be withheld unreasonably. The Auction Agent shall give notice
of any such change to Broker-Dealer. Such notice shall be received prior to the
first Auction Date on which any such change shall be effective.
Time Event
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By 9:30 a.m. The Auction Agent shall advise the Fund and
the Broker-Dealers of the Reference Rate and
the Maximum Rate as set forth in Section
3.2(a) hereof.
9:30 a.m. - 1:00 p.m. The Auction Agent shall assemble information
communicated to it by Broker-Dealers as
provided in Section 2 of Appendix A of the
Supplemental Indenture. Submission Deadline
is 1:00 P.M.
Not earlier than 1:00 p.m. The Auction Agent shall make determinations
pursuant to Section 3 of Appendix A of the
Supplemental Indenture.
By approximately 3:00 p.m. The Auction Agent shall advise the Fund of
the results of the Auction as provided in
Section 3(b) of Appendix A of the
Supplemental Indenture. Submitted Bids and
Submitted Sell Orders will be accepted and
rejected in whole or in part and Energy
Notes will be allocated as provided in
Section 4 of Appendix A of the Supplemental
Indenture.
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The Auction Agent shall give notice of the
Auction results as set forth in Section
3.4(a) hereof.
The Auction Agent will follow the Bond Market Association's Market
Practice U.S. Holiday Recommendations for shortened trading days for the bond
markets (the "BMA Recommendation") unless the Auction Agent is instructed
otherwise. In the event of a BMA Recommendation on an Auction Date, the
Submission Deadline will be 11:30 a.m., instead of 1:00 p.m., and as a result
the notice set forth in Section 3.3 will occur earlier.
(b) Broker-Dealer agrees to maintain a list of Potential Beneficial
Owners and to contact the Potential Beneficial Owners on such list on or prior
to each Auction Date for the purposes set forth in Section 1(a)(ii) of Appendix
A of the Supplemental Indenture.
(c) Broker-Dealer shall submit Orders to the Auction Agent in writing
in substantially the form attached hereto as Exhibit B. Broker-Dealer shall
submit separate Orders to the Auction Agent for each Potential Beneficial Owner
or Beneficial Owner on whose behalf Broker-Dealer is submitting an Order and
shall not net or aggregate the Orders of Potential Beneficial Owners or
Beneficial Owners on whose behalf Broker-Dealer is submitting Orders.
(d) Broker-Dealer shall deliver to the Auction Agent (i) a written
notice, substantially in the form attached hereto as Exhibit C, of transfers of
Energy Notes, made through Broker-Dealer 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 D, of the failure of Energy Notes to be
transferred to or by any Person that purchased or sold Energy Notes through
Broker-Dealer 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 unless it is received by the Auction Agent by 3:00 P.M. on
the Business Day preceding the applicable Auction Date.
3.4 Notice of Auction Results.
(a) On each Auction Date, the Auction Agent shall provide to
Broker-Dealer the notice required by paragraph (a) of the Settlement Procedures.
On the Business Day next succeeding such Auction Date, the Auction Agent shall
notify Broker-Dealer in writing of the disposition of all Orders submitted by
Broker-Dealer in the Auction held on such Auction Date.
(b) Broker-Dealer shall notify each Beneficial Owner, Potential
Beneficial Owner, Existing Holder or Potential Holder on whose behalf
Broker-Dealer has submitted an Order as set forth in paragraph (b) of the
Settlement Procedures, and take such other action as is required of
Broker-Dealer pursuant to the Settlement Procedures.
If any Beneficial Owner or Existing Holder selling Energy Notes in an
Auction fails to deliver such Energy Notes, the Broker-Dealer of any Person that
was to have purchased Energy Notes in such Auction may deliver to such Person a
number of whole Energy Notes that is less than the number of Energy Notes that
otherwise was to be purchased by such Person. In such event, the number of
Energy Notes to be so delivered shall be determined by such Broker-Dealer.
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Delivery of such lesser number of Energy Notes shall constitute good delivery.
Upon the occurrence of any such failure to deliver Energy Notes, such
Broker-Dealer shall deliver to the Auction Agent the notice required by Section
3.3(d)(ii) hereof. Notwithstanding the foregoing terms of this Section 3.4(b),
any delivery or non-delivery of Energy Notes 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(d) hereof.
3.5 Service Charge to be Paid to Broker-Dealer.
Not later than 3:00 p.m. on each Interest Payment Date, the Auction
Agent after each Auction will pay to each Broker-Dealer, from funds provided by
the Fund, a service charge in the amount equal to: (i) in the case of any
Auction immediately preceding a Rate Period of less than one year, the product
of (A) a fraction the numerator of which is the number of days in the Rate
Period (calculated by counting the first day of such Rate Period but excluding
the last day thereof) and the denominator of which is 360, times (B) 1/4 of 1%,
times (C) $25,000 times (D) the sum of the aggregate number of Energy Notes
placed by such Broker-Dealer, or (ii) the amount mutually agreed upon by the
Fund and the Broker-Dealers in the case of any Auction immediately preceding a
Rate Period of one year or longer. For the purposes of the preceding sentence,
the Energy Notes shall be placed by a Broker-Dealer if such notes were (i) the
subject of Hold Orders deemed to have been submitted to the Auction Agent by the
Broker-Dealer and were acquired by the Broker-Dealer for its own account or were
acquired by the Broker-Dealer for its customers who are Beneficial Owners or
(ii) the subject of an Order submitted by the Broker-Dealer that is (a) a
Submitted Bid of an Existing Holder that resulted in the Existing Holder
continuing to hold the notes as a result of the Auction or (b) a Submitted Bid
of a Potential Holder that resulted in the Potential Holder purchasing the notes
as a result of the Auction or (iii) a valid Hold Order. For the avoidance of
doubt, only one Broker-Dealer shall be considered to have placed a particular
Energy Note at any particular Auction for purposes of this Section 3.5.
IV. THE AUCTION AGENT.
4.1 Duties and Responsibilities.
(a) The Auction Agent is acting solely as agent for the Fund hereunder
and owes no fiduciary duties to any Person.
(b) The Auction Agent undertakes to perform such duties and only such
duties as are set forth specifically 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 by it, 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 grossly negligent in
ascertaining (or failing to ascertain) the pertinent facts.
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4.2 Rights of the Auction Agent.
(a) The Auction Agent may rely conclusively upon, and shall be fully
protected in acting or refraining from acting in accordance with, any
communication authorized by this Agreement and any proper written instruction,
notice, request, direction, consent, report, certificate, or other instrument,
paper or document reasonably believed by it to be genuine and appropriately
authorized. The Auction Agent shall not be liable for acting upon any telephone
communication authorized by this Agreement which the Auction Agent reasonably
believes in good faith, after reasonable inquiry, to have been given by the Fund
or by a Broker-Dealer. The Auction Agent may record telephone communications
with the Fund or with the Broker-Dealers or with both.
(b) The Auction Agent may consult with counsel of its 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 the Auction Agent
hereunder in good faith and in reasonable 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. Unless otherwise instructed by the Fund in
writing, the Auction Agent (i) shall not be obligated to invest any money
received by it hereunder and (ii) shall be under no liability for interest on
any money received by it hereunder.
(d) The Auction Agent may perform its duties and exercise its rights
hereunder either directly or by or through agents or attorneys and shall not be
responsible for any misconduct or negligence on the part of any agent or
attorney appointed by it with due care hereunder.
(e) The Auction Agent shall not be responsible or liable for any
failure or delay in the performance of its obligations under this Agreement
arising out of or caused, directly or indirectly, by circumstances beyond its
reasonable control, including, without limitation, acts of God; earthquakes;
fires; floods; wars; civil or military disturbances; sabotage; epidemics; riots;
acts of terrorism; interruptions, loss or malfunctions of utilities, computer
(hardware or software) or communications services; accidents; labor disputes;
acts of civil or military authority or governmental actions; it being understood
that the Auction Agent shall use reasonable efforts which are consistent with
accepted practices in the banking industry to resume performance as soon as
practicable under the circumstances.
(f) The Auction Agent shall not be required to, and does not, make any
representations as to the validity, accuracy, value or genuineness of any
signatures or endorsements, other than its own and those of its authorized
officers.
(g) Any corporation into which the Auction Agent 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 Auction Agent shall be
a party, or any corporation succeeding to the dealing and trading business of
the Auction Agent shall be the successor of the Auction Agent hereunder, with
the consent of the Fund but without the execution or filing of any paper with
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any party hereto or any further act on the part of any of the parties hereto,
except where any instrument of transfer or assignment may be required by law to
effect such succession, anything herein to the contrary notwithstanding.
(h) All the rights, privileges, immunities and protections granted to
the Auction Agent herein are deemed granted to the Paying Agent and Deutsche
Bank Trust Company Americas in any of the capacities it undertakes in connection
with this Agreement.
(i) Whenever in the administration of the provisions of this
Agreement, the Auction Agent shall deem it necessary or desirable that a matter
be proved or established prior to taking or suffering any action to be taken
hereunder, such matter, in the absence of negligence or bad faith on the part of
the Auction Agent, shall be deemed to be proved conclusively and established by
a certificate describing the action requested by the Fund or the Broker Dealer,
signed by the Fund or the Broker Dealer, respectively, and delivered to the
Auction Agent and such certificate, in the absence of negligence or bad faith on
the part of the Auction Agent, shall be full warrant to the Auction Agent for
any action taken or omitted by it under the provisions of this Agreement upon
the faith thereof. Upon receipt of any such certificate signed by the Fund or
the Broker-Dealer, the Auction Agent shall promptly provide a copy of said
certificate to the Broker-Dealer or the Fund, respectively. The Auction Agent
shall not be bound to make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, entitlement, order, approval or other paper or document
furnished by the Fund or the Broker-Dealer, except to the extent that such
failure to investigate would be deemed grossly negligent.
V. MISCELLANEOUS.
5.1 Termination.
------------
Any party may terminate this Agreement at any time upon five days' prior
written notice to the other party; provided, however, that if the Broker-Dealer
is Xxxxxx Brothers Inc., either Xxxxxx Brothers Inc. or the Auction Agent may
terminate this Agreement only upon [45] days' prior written notice to the other
party and to the Fund. This Agreement shall automatically terminate upon the
redemption of all outstanding Energy Notes or upon termination of the Auction
Agency Agreement.
5.2 Force Majeure
-------------
Neither party to this Agreement shall be responsible or liable for any
failure or delay in the performance of its obligations under this Agreement
arising out of or caused, directly or indirectly, by circumstances beyond its
reasonable control, including, without limitation, acts of God; earthquakes;
fires; floods; wars; civil or military disturbances; sabotage; epidemics; riots;
acts of terrorism; interruptions, loss or malfunctions of utilities, computer
(hardware or software) or communications services; accidents; labor disputes;
acts of civil or military authority or governmental actions; it being understood
that the parties shall use reasonable efforts which are consistent with accepted
practices in the banking industry to resume performance as soon as practicable
under the circumstances.
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5.3 Participant in Securities Depository; Payment of Interest
in Same-Day Funds.
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(a) Broker-Dealer is at the date hereof, and shall remain for the term
of this Agreement, a member of, or a participant in, the Securities Depository
(or an affiliate of such a member or participant).
(b) Broker-Dealer represents that it (or if Broker-Dealer does not act
as Agent Member, one of its affiliates) shall make all interest payments on the
Energy Notes available in same-day funds on each Interest Payment Date to
customers that use Broker-Dealer (or its affiliate) as Agent Member.
5.4 Communications.
---------------
(a) Except for (i) communications authorized to be made by telephone
pursuant to this Agreement or the Auction Procedures and (ii) communications
with the Auctions (other than those expressly required to be made 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 at its address or telecopier number set forth below:
If to the Auction Agent,
addressed to:
Deutsche Bank Trust Company Americas
[Corporate Trust & Agency Services
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Mail Stop NYC60 2715
Telephone: (000) 000-0000
Facsimile: (000) 000-0000]
If to the Broker-Dealer,
addressed to:
Telephone:
Facsimile:
or such other address or telecopier number as such party hereafter may 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 Broker-Dealer by a Broker-Dealer
Officer and on behalf of the Auction Agent by an Authorized Officer.
Broker-Dealer may record telephone communications with the Auction Agent.
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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 implied,
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 Fund, which is a third party beneficiary of this Agreement, the
Auction Agent and Broker-Dealer and their respective successors and permitted
assigns, any benefit of any legal or equitable right, remedy or claim under this
Agreement.
5.7 Amendment; Waiver.
------------------
(a) This Agreement shall not be deemed or construed to be modified,
amended, rescinded, canceled 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
Broker-Dealer and the Auction Agent. This Agreement may not be assigned by
either party hereto absent the prior written consent of the other party.
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.
5.11 Governing Law, Jurisdiction, Waiver of Trial By Jury.
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THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ANY PROVISIONS THEREOF
RELATING TO CONFLICTS OF LAW, OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF NEW YORK). THE PARTIES AGREE HERETO THAT ALL ACTIONS AND
PROCEEDINGS ARISING OUT OF THIS BROKER-DEALER AGREEMENT OR ANY TRANSACTIONS
Page 10
CONTEMPLATED HEREBY SHALL BE BROUGHT IN THE COURTS LOCATED IN THE BOROUGH OF
MANHATTAN, CITY OF NEW YORK, STATE OF NEW YORK.
EACH PARTY WAIVES ANY OBJECTION THAT IT MAY HAVE THAT SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN THE COURTS LOCATED IN THE BOROUGH OF MANHATTAN, CITY OF
NEW YORK AND STATE OF NEW YORK WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES
NOT TO PLEAD OR CLAIM THE SAME. EACH OF THE PARTIES HERETO ALSO IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
[Signature page follows]
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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.
DEUTSCHE BANK TRUST COMPANY
AMERICAS, as Auction Agent
By: _______________________________________
Name:
Title:
[Broker-Dealer]
By: _______________________________________
Name:
Title:
Page 12
EXHIBIT A
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SETTLEMENT PROCEDURES
Capitalized terms used herein shall have the respective meanings
specified in the Supplemental Indenture.
(a) On each Auction Date, the Auction Agent shall notify by telephone,
or through the Auction Agent's auction processing system, the Broker-Dealers
that participated in the Auction held on such Auction Date and submitted an
Order on behalf of any Beneficial Owner or Potential Beneficial Owner of:
(i) the Applicable Rate fixed for the next succeeding Rate 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 a Sell Order on behalf of a Beneficial Owner, the number of Energy Notes,
if any, to be sold by such Beneficial Owner;
(iv) if such Broker-Dealer (a "Buyer's Broker-Dealer") submitted a Bid
on behalf of a Potential Beneficial Owner, the number of Energy Notes, if any,
to be purchased by such Potential Beneficial Owner;
(v) if the aggregate number of Energy Notes to be sold by all
Beneficial Owners on whose behalf such Broker-Dealer submitted a Bid or a Sell
Order exceeds the aggregate number of Energy Notes to be purchased by all
Potential Beneficial Owners on whose behalf such Broker-Dealer submitted a Bid,
the name or names of one or more Buyer's Broker-Dealers (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 Energy Notes and the number of such Energy
Notes to be purchased from one or more Beneficial Owners on whose behalf such
Broker-Dealer acted by one or more Potential Beneficial Owners on whose behalf
each of such Buyer's Broker-Dealers acted;
(vi) if the aggregate number of Energy Notes to be purchased by all
Potential Beneficial Owners on whose behalf such Broker-Dealer submitted a Bid
exceeds the aggregate number of Energy Notes to be sold by all Beneficial Owners
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 Energy Notes and the number of such Energy Notes to be
sold to one or more Potential Beneficial Owners on whose behalf such
Broker-Dealer acted by one or more Beneficial Owners on whose behalf each of
such Seller's Broker-Dealers acted; and
(vii) the Auction Date of the next succeeding Auction with respect to
the Energy Notes.
Page A-1
(b) On each Auction Date, each Broker-Dealer that submitted an Order
on behalf of any Beneficial Owner or Potential Beneficial Owner shall:
(i) in the case of a Broker-Dealer that is a Buyer's Broker-Dealer,
instruct each Potential Beneficial Owner on whose behalf such Broker-Dealer
submitted a Bid that was accepted, in whole or in part, to instruct such
Potential Beneficial Owner'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 Energy Notes to be purchased pursuant to such Bid against receipt
of such Energy Notes and advise such Potential Beneficial Owner of the
Applicable Rate for the next succeeding Rate Period;
(ii) in the case of a Broker-Dealer that is a Seller's Broker-Dealer,
instruct each Beneficial Owner 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 Beneficial Owner's Agent Member to deliver
to such Broker-Dealer (or its Agent Member) through the Securities Depository
the number of Energy Notes to be sold pursuant to such Order against payment
therefor and advise any such Beneficial Owner that will continue to hold Energy
Notes of the Applicable Rate for the next succeeding Rate Period;
(iii) advise each Beneficial Owner on whose behalf such Broker-Dealer
submitted a Hold Order of the Applicable Rate for the next succeeding Rate
Period;
(iv) advise each Beneficial Owner on whose behalf such Broker-Dealer
submitted an Order of the Auction Date for the next succeeding Auction; and
(v) advise each Potential Beneficial Owner 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 Beneficial Owner or a Beneficial Owner shall, in such manner and at
such time or times as in its sole discretion it may determine, allocate any
funds received by it pursuant to (b)(i) above and any Energy Notes received by
it pursuant to (b)(ii) above among the Potential Beneficial Owners, if any, on
whose behalf such Broker-Dealer submitted Bids, the Beneficial Owners, 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 Beneficial Owner and Beneficial Owner 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 Beneficial Owner delivering
Energy Notes to such Broker-Dealer pursuant to (b)(ii) above the amount
necessary to purchase such Energy Notes against receipt of such Energy Notes,
and (B) deliver such Energy Notes through the Securities Depository to a Buyer's
Page A-2
Broker-Dealer (or its Agent Member) identified to such Seller's Broker-Dealer
pursuant to (a)(v) above against payment therefor; and
(iii) each Buyer'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 a Seller's Broker-Dealer (or its Agent Member)
identified pursuant to (a)(vi) above the amount necessary to purchase the Energy
Notes to be purchased pursuant to (b)(i) above against receipt of such Energy
Notes, and (B) deliver such Energy Notes through the Securities 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 in
(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 a Beneficial Owner selling Energy Notes in an Auction fails to
deliver such Energy Notes (by authorized book-entry), a Broker-Dealer may
deliver to the Potential Beneficial Owner on behalf of which it submitted a Bid
that was accepted a number of whole Energy Notes that is less than the number of
Energy Notes that otherwise was to be purchased by such Potential Beneficial
Owner. In such event, the number of Energy Notes to be so delivered shall be
determined solely by such Broker-Dealer. Delivery of such lesser number of
Energy Notes shall constitute good delivery. Notwithstanding the foregoing terms
of this paragraph (f), any delivery or non-delivery of Energy Notes 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 Agency Agreement and the Broker-Dealer Agreements.
Page A-3
EXHIBIT B
---------
AUCTION BID FORM
Submit To: Issue:
Series ___ Energy Notes of Energy
Income and Growth Fund
The undersigned Broker-Dealer submits the following Order on behalf of the
Bidder listed below:
Name of Bidder:______________________________________
BENEFICIAL OWNER
Notes now held ______________________ HOLD __________________
BID at rate of _____________
SELL_____________________
POTENTIAL BENEFICIAL OWNER
# of Energy Notes ___________
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 Energy Notes held by any Beneficial
Owner are submitted, such bid shall be considered valid in the
order of priority set forth in the Auction Procedures on the
above issue.
(3) A Hold or Sell Order may be placed only by a Beneficial Owner
covering a number of Energy Notes not greater than the number
of Energy Notes currently held.
(4) Potential Beneficial Owners may make only Bids, each of which
must specify a rate. If more than one Bid is submitted on
behalf of any Potential Beneficial Owner, 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 be accepted.
(6) An Order must be submitted in whole Energy Notes of Energy
Notes with an aggregate liquidation preference of $25,000.
Page B-1
____________________________________________________________
____________________________________________________________
Authorized Signature: __________________________________
Name:
Title:
Page B-2
EXHIBIT C
---------
(Note: To be used only for transfers made other than pursuant to an Auction)
TRANSFER FORM
Re: _________________________________________________________________
("Energy Notes")
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 Beneficial Owner has
transferred _________ Energy Notes to ____________________________
________________________________
(Name of Existing Holder)
________________________________
(Name of Broker-Dealer)
________________________________
(Name of Agent Member)
By: ________________________________
Printed Name:
Title:
Page C-1
EXHIBIT D
---------
(Note: To be used only for failures to deliver or to pay for
Energy Notes sold pursuant to an Auction)
NOTICE OF A FAILURE TO DELIVER
We are a Broker-Dealer for _____________________ (the "Purchaser"),
which purchased _____ Energy Notes of ________________________________________
in the Auction held on __________________ from the seller of such Energy Notes.
We hereby notify you that (check one):
______ the Seller failed to deliver such Energy Notes to the Purchaser.
______ the Purchaser failed to make payment to the Seller upon delivery of
such Energy Notes.
Name:__________________________________
By:____________________________________
Printed Name:
Title:
Page D-1
