Exhibit 99.(k)(i)
[ISSUER NAME]
---------------------------
FORM OF AUCTION AGENCY AGREEMENT
dated as of [Month] __, [year]
Relating to
Auction Preferred Shares
[Series],
of
[ISSUER NAME]
---------------------------
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Auction Agent
AUCTION AGENCY AGREEMENT
This Auction Agency Agreement (this "Agreement"), dated as of [Month] __,
[year], is between [ISSUER NAME] (the "Fund") and Deutsche Bank Trust Company
Americas, a New York banking corporation.
The Fund proposes to issue an aggregate of [# of shares] APS, par value
$0.001 per share, liquidation preference $50,000 per share, designated as
Auction Preferred [Shares] (the "APS"), pursuant to the Fund's Articles
Supplementary (as defined below).
The Fund desires that Deutsche Bank Trust Company Americas perform certain
duties as agent in connection with each Auction (as defined below) of APS (in
such capacity, the "Auction Agent"), and as the transfer agent, registrar,
dividend paying agent and redemption agent with respect to the APS (in such
capacity, the "Paying Agent"), upon the terms and conditions of this Agreement,
and the Fund hereby appoints Deutsche Bank Trust Company Americas as said
Auction Agent and Paying Agent in accordance with those terms and conditions
(hereinafter generally referred to as the "Auction Agent," except in Sections 3
and 4 below).
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the Fund and the Auction Agent agree as follows:
I. DEFINITIONS AND RULES OF CONSTRUCTION.
1.1 TERMS DEFINED BY REFERENCE TO THE ARTICLES SUPPLEMENTARY
Capitalized terms used herein but not defined herein shall have the
respective meanings specified in the Articles Supplementary.
1.2 CERTAIN DEFINED TERMS
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) "Agent Member" of any Person shall mean the member of, or
participant in, the Securities Depository that will act on behalf of a Bidder.
(b) "Articles Supplementary" shall mean the Articles Supplementary of
the Fund in effect at the time the Registration Statement relating to the APS is
declared effective by the Securities and Exchange Commission, specifying the
powers, preferences and rights of the APS.
(c) "Auction" shall have the meaning specified in Section 2.1 hereof.
(d) "Auction Procedures" shall mean the procedures as from time to
time in effect for conducting Auctions that are set forth in Part II of the
Articles Supplementary.
(e) "Authorized Officer" shall mean each Managing Director, Vice
President, Assistant Vice President and Associate 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.
(f) "Broker-Dealer" shall mean any broker-dealer, commercial bank or
other entity permitted by law to perform the functions of a Broker-Dealer that
is a member of, or a participant in, the Securities Depository or is an
affiliate of such member or participant, has been selected by the Fund and has
entered into a Broker-Dealer Agreement that remains effective.
(g) "Broker-Dealer Agreement" shall mean each agreement between the
Auction Agent and a Broker-Dealer substantially in the form attached hereto as
EXHIBIT A.
(h) "Closing" shall mean the date the Fund consummates the
transactions for the issuance and sale of the APS.
(i) "Fund Officer" shall mean the Chairman of the Board of Directors
of the Fund, the President, each Vice President (whether or not designated by a
number or word or words added before or after the title "Vice President"), the
Secretary, the Treasurer, each Assistant Secretary and each Assistant Treasurer
of the Fund and every other officer or employee of the Fund designated as a
"Fund Officer" for purposes hereof in a notice to the Auction Agent.
(j) "Holder" shall be a holder of record of one or more APS, listed as
such in the Share Register.
(k) "Master Purchaser's Letter" shall mean a letter addressed to the
Fund, a Broker-Dealer and an Agent Member, substantially in the form attached
hereto as Exhibit B.
(l) "Potential Holder," when used with respect to the APS, shall mean
any Person, including any Existing Holder of APS, (i) who shall have executed a
Master Purchaser's Letter and (ii) who may be interested in acquiring APS (or,
in the case of an Existing Holder of APS, additional APS).
(m) "Settlement Procedures" shall mean the Settlement Procedures
attached as Exhibit A to the Broker-Dealer Agreement.
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.
II. THE AUCTION.
2.1 PURPOSE; INCORPORATION BY REFERENCE OF AUCTION PROCEDURES AND SETTLEMENT
PROCEDURES
(a) The Board of Directors of the Fund has adopted a resolution
appointing Deutsche Bank Trust Company Americas as Auction Agent for purposes of
the Auction Procedures. The Auction Agent hereby accepts such appointment and
agrees that, on each Auction Date, it shall follow the procedures set forth in
this Section 2 and the Auction Procedures for the purpose of determining the
Applicable Rate for the APS for the next Dividend Period. Each periodic
operation of such procedures is hereinafter referred to as an "Auction."
(b) All of the provisions contained in the Auction Procedures and in
the Settlement Procedures are incorporated herein by reference in their entirety
and shall be deemed to be a part hereof to the same extent as if such provisions
were set forth fully herein.
2.2 PREPARATION FOR EACH AUCTION; MAINTENANCE OF REGISTRY OF EXISTING HOLDERS
(a) As of the date hereof, the Fund shall provide the Auction Agent
with a list of the Broker-Dealers previously approved by the Auction Agent and
shall cause to be delivered to the Auction Agent for execution by the Auction
Agent a Broker-Dealer Agreement signed by each such Broker-Dealer. The Auction
Agent shall keep such list current and accurate and shall indicate thereon, or
on a separate list, the identity of each Existing Holder, if any, whose most
recent Order was submitted by a Broker-Dealer on such list and resulted in such
Existing Holder continuing to hold or purchase APS. Not later than five Business
Days prior to any Auction Date for which any change in such list of
Broker-Dealers is to be effective, the Fund shall notify the Auction Agent in
writing of such change and, if any such change is the addition of a
Broker-Dealer to such list, the Fund shall cause to be delivered to the Auction
Agent for execution by the Auction Agent a Broker-Dealer Agreement signed by
such Broker-Dealer. The Auction Agent may not add a Broker-Dealer to such list
otherwise than pursuant to the previous sentence. The Auction Agent shall have
entered into a Broker-Dealer Agreement with each Broker-Dealer prior to the
participation of any such Broker-Dealer in any Auction.
(b) In the event that the Auction Date for any Auction shall be
changed after the Auction Agent shall have 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 reasonably deems practicable, shall give
notice of such change to the Broker-Dealers 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.
(c) The provisions contained in Section ____ of the Articles
Supplementary concerning Special Dividend Periods and the notification of a
Special Dividend Period will be followed by the Fund and, to the extent
applicable, the Auction Agent, and the provisions
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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.
(d) (i) On each Auction Date, the Auction Agent shall determine the
Maximum Rate. Not later than 9:30 a.m. on each Auction Date, the Auction Agent
shall notify the Fund and the Broker-Dealers of the Maximum Rate.
(ii) If the Reference Rate is the applicable "AA" Composite
Commercial Paper Rate and such rate is to be based on rates supplied by
Commercial Paper Dealers and one or more of the Commercial Paper Dealers shall
not provide a quotation for the determination of the applicable "AA" Composite
Commercial Paper Rate, the Auction Agent immediately shall notify the Fund so
that the Fund can determine whether to select a substitute Commercial Paper
Dealer or substitute Commercial Paper Dealers to provide the quotation or
quotations not being supplied by any Commercial Paper Dealer or Commercial Paper
Dealers. The Fund promptly shall advise the Auction Agent of any such selection.
If the Fund does not select any such substitute Commercial Paper Dealer or
substitute Commercial Paper Dealers, then the rates shall be supplied by the
remaining Commercial Paper Dealer or Commercial Paper Dealers.
(e) (i) The Auction Agent shall maintain a current registry of the
Existing Holders of the APS for purposes of each individual Auction. The Fund
shall provide or cause to be provided to the Auction Agent at or prior to the
Date of Original Issue of the APS of each series a list of the initial Existing
Holders of the shares of each such series of APS, the number of shares purchased
by each such Existing Holder and the respective Broker-Dealer of each such
Existing Holder or the affiliate thereof through which each such Existing Holder
purchased such shares. The Auction Agent may rely upon, as evidence of the
identities of the Existing Holders, such list, the results of each Auction and
notices from any Existing Holder, the Agent Member of any Existing Holder or the
Broker-Dealer of any Existing Holder with respect to such Existing Holder's
transfer of any APS to another Person.
(ii) In the event of any partial redemption of APS, upon notice
by the Fund to the Auction Agent of such partial redemption, the Auction Agent
promptly shall request the Securities Depository to notify the Auction Agent of
the identities of the Agent Members (and the respective numbers of shares) from
the accounts of which shares have been called for redemption and the person or
department at such Agent Member to contact regarding such redemption. At least
two Business Days prior to the Auction preceding the date of redemption, the
Auction Agent shall request each Agent Member so identified to disclose to the
Auction Agent (upon selection by such Agent Member of the Existing Holders whose
shares are to be redeemed) the number of APS of each such Existing Holder, if
any, to be redeemed by the Fund, provided that the Auction Agent has been
furnished with the name and telephone number of a person or department at such
Agent Member from which it is to request such information. In the absence of
receiving any such information with respect to an Existing Holder, from such
Existing Holder's Agent Member or otherwise, the Auction Agent may continue to
treat such Existing Holder as having ownership of the number of APS shown in the
Auction Agent's registry of Existing Holders.
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(iii) The Auction Agent shall register a transfer of the
ownership of APS from an Existing Holder to another Existing Holder, or to
another Person if permitted by the Fund, only if (A) such transfer is made
pursuant to an Auction or (B) if such transfer is made other than pursuant to an
Auction, the Auction Agent has been notified of such transfer in writing, in a
notice substantially in the form of Exhibit C to the Broker-Dealer Agreement, by
such Existing Holder or by the Agent Member of such Existing Holder. The Auction
Agent is not required to accept any notice of transfer delivered for an Auction
unless it is received by the Auction Agent by 3:30 P.M. on the Business Day
preceding such Auction. The Auction Agent shall rescind a transfer made on the
registry of the Existing Holders of any APS if the Auction Agent has been
notified in writing, in a notice substantially in the form of Exhibit D to the
Broker-Dealer Agreement, by the Agent Member or the Broker-Dealer of any Person
that (i) purchased any APS and the seller failed to deliver such shares or (ii)
sold any APS and the purchaser failed to make payment to such Person upon
delivery to the purchaser of such shares.
(f) The Auction Agent may request that the Broker-Dealers, as set
forth in Section 3.2(c) of the Broker-Dealer Agreements, provide the Auction
Agent with a list of their respective customers that such Broker-Dealers believe
are Beneficial Owners of APS. The Auction Agent shall keep confidential any such
information and shall not disclose any such information so provided to any
Person other than the relevant Broker-Dealer and the Fund, provided that the
Auction Agent reserves the right to disclose any such information if it is
advised by its counsel that its failure to do so would be unlawful.
2.3 AUCTION SCHEDULE
Subject to Article ____ of the Articles Supplementary, the Auction Agent
shall normally conduct Auctions weekly (usually ______ for Series ____) in
accordance with the schedule set forth below. Such schedule may be changed 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
each Broker-Dealer. Such notice shall be received prior to the first Auction
Date on which any such change shall be effective.
TIME EVENT
By 9:30 a.m. Auction Agent shall advise the Fund and
the Broker-Dealers of the Reference Rate
and the Maximum Rate as set forth in
Section 2.2(d)(i) hereof.
9:30 a.m. - 1:30 p.m. Auction Agent shall assemble information
communicated to it by Broker-Dealers as
provided in Section 1(a) of the Auction
Procedures. Submission deadline is 1:30
p.m.
Not earlier than 1:30 p.m. Auction Agent shall make determinations
pursuant to Section 4(a) of the Auction
Procedures.
By approximately 3:00 p.m. Auction Agent shall advise the Fund of
the results of the Auction as provided
in Section 4(b) of the Auction
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Procedures.
Submitted Bid Orders and Submitted Sell
Orders will be accepted and rejected in
whole or in part and APS will be
allocated as provided in Section _5 of
the Auction Procedures.
Auction Agent shall give notice of the
Auction results as set forth in Section
2.4 hereof.
2.4 NOTICE OF AUCTION RESULTS
The Auction Agent will advise each Broker-Dealer who submitted a Bid or
Sell Order in an Auction whether such Bid or Sell Order was accepted or rejected
in whole or in part and of the Applicable Rate for the next Dividend Period for
the related APS by telephone or through its Auction Processing System as set
forth in paragraph (a) of the Settlement Procedures.
2.5 BROKER-DEALERS
(a) Not later than 12:00 noon on each Payment Date, the Auction Agent
after each Auction will pay a service charge from funds provided by the Fund to
each Broker-Dealer in an amount equal to the aggregate fees payable to such
Broker-Dealer pursuant to Section 2.6 of the Broker-Dealer Agreement. The
Auction Agent shall apply such moneys as set forth in Section 2.6 of each such
Broker-Dealer Agreement.
(b) The Fund shall not designate any Person to act as a Broker-Dealer,
or permit an Existing Holder or a Potential Beneficial Owner to participate in
Auctions through any Person other than a Broker-Dealer, without the prior
written approval of the Auction Agent, which approval shall not be withheld
unreasonably. The Fund may designate an affiliate or [Underwriter] to act as a
Broker-Dealer.
(c) The Auction Agent shall terminate any Broker-Dealer Agreement as
set forth therein if so directed by the Fund provided that at least one
Broker-Dealer Agreement would be in effect for each series of APS after such
termination
(d) Subject to Section 2.5(b) hereof, the Auction Agent from time to
time shall enter into such Broker-Dealer Agreements as the Fund shall request.
The Auction Agent shall not enter into any Broker-Dealer Agreement otherwise
than pursuant to a Fund request.
(e) The Auction Agent shall maintain a list of Broker-Dealers.
2.6 OWNERSHIP OF APS AND SUBMISSION OF BIDS BY THE FUND AND ITS AFFILIATES
Neither the Fund nor any affiliate of the Fund may submit an Order in any
Auction, except that an affiliate of the Fund that is a Broker-Dealer may submit
an Order. The Fund shall notify the Auction Agent if the Fund or, to the best of
the Fund's knowledge, any affiliate of the Fund becomes a Beneficial Owner of
any APS. Pursuant to the Articles Supplementary of the
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Fund, the Fund and the Fund's affiliates shall be prohibited from reissuing and
its affiliates (other than an Underwriter) will be prohibited from transferring
(other than to the Fund or pursuant to an Auction) any APS they may acquire. For
purposes of this Section 2.6, a Broker-Dealer shall not be deemed to be an
affiliate of the Fund solely because one or more of the directors or executive
officers of such Broker- Dealer or of any person controlled by, in control of or
under common control with such Broker-Dealer is also a director of the Fund. The
restrictions in this Section 2.6 shall in no way limit the activities of the
Auction Agent. The Auction Agent shall have no duty or liability with respect to
enforcement of this Section 2.6.
2.7 ACCESS TO AND MAINTENANCE OF AUCTION RECORDS
The Auction Agent shall afford to the Fund and its agents, independent
public accountants and counsel access at reasonable times during normal business
hours to review and make extracts or copies (at the Fund's sole cost and
expense) of all books, records, documents and other information concerning the
conduct and results of Auctions, provided that any such agent, accountant or
counsel shall furnish the Auction Agent with a letter from the Fund requesting
that the Auction Agent afford such person access. The Auction Agent shall
maintain records relating to any Auction for a period of at least two years
after such Auction, and such records, in reasonable detail, shall accurately and
fairly reflect the actions taken by the Auction Agent hereunder. The Fund agrees
to keep confidential any information regarding the customers of any
Broker-Dealer received from the Auction Agent in connection with this Agreement
or any Auction, and shall not disclose such information or permit the disclosure
of such information without the prior written consent of the applicable
Broker-Dealer to anyone except such agent, accountant or counsel engaged to
audit or review the results of Auctions as permitted by this Section 2.7. The
Fund reserves the right to disclose any such information if it is advised by its
counsel that its failure to do so would (i) be unlawful or (ii) expose it to
liability, unless the Broker-Dealer shall have offered indemnification
satisfactory to the Fund. Any such agent, accountant or counsel, before having
access to such information, shall agree to keep such information confidential
and not to disclose such information or permit disclosure of such information
without the prior written consent of the applicable Broker-Dealer, provided that
such agent, accountant or counsel may reserve the right to disclose any such
information if it is advised by its counsel that its failure to do so would (i)
be unlawful or (ii) expose it to liability, unless the Broker-Dealer shall have
offered indemnification satisfactory to such agent, accountant or counsel.
2.8 AUCTION PROCEDURES
The provisions contained in Part II of the Articles Supplementary
concerning Auction Procedures will be followed by the Fund and, to the extent
applicable, the Auction Agent, 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 AGENT AS PAYING AGENT
3.1 THE PAYING AGENT
The Board of Directors of the Fund has adopted resolutions appointing
Deutsche Bank Trust Company Americas as Auction Agent and dividend paying agent
(in such capacity, the "Paying Agent"). The Paying Agent hereby accepts such
appointment and agrees to act in accordance with its standard procedures and the
provisions of the Articles Supplementary which are specified herein with respect
to the APS and as set forth in this Section 3.
3.2 THE FUND'S NOTICES TO THE PAYING AGENT
Whenever any APS are to be redeemed, the Fund shall mail a Notice of
Redemption by first-class mail, postage prepaid, to each Holder of APS being
redeemed and to the Paying Agent pursuant to the Articles Supplementary.
3.3 THE FUND TO PROVIDE FUNDS FOR DIVIDENDS AND REDEMPTIONS
(a) Not later than 12:00 noon on each Dividend Payment Date, the Fund
shall deposit with the Paying Agent an aggregate amount of Federal Funds or
similar same-day funds equal to the declared dividends to be paid to Holders on
such Dividend Payment Date and shall give the Paying Agent irrevocable
instructions to apply such funds to the payment of such dividends on such
Dividend Payment Date.
(b) If the Fund shall give a Notice of Redemption, then by noon of the
date fixed for redemption, the Fund shall deposit in trust with the Paying Agent
an aggregate amount of Federal Funds or similar same-day funds sufficient to
redeem such APS called for redemption and shall give the Paying Agent
irrevocable instructions and authority to pay the redemption price to the
Holders of APS called for redemption upon surrender of the certificate or
certificates therefor.
3.4 DISBURSING DIVIDENDS AND REDEMPTION PRICE
After receipt of the Federal Funds or similar same-day funds and
instructions from the Fund described in Section 3.3 above, the Paying Agent
shall pay to the Holders (or former Holders) entitled thereto (i) on each
corresponding Dividend Payment Date, dividends on the APS, and (ii) on any date
fixed for redemption, the redemption price of any APS called for redemption. The
amount of dividends for any Dividend Period to be paid by the Paying Agent to
Holders will be determined by the Fund as set forth in Section ____ of Part I of
the Articles Supplementary. The redemption price to be paid by the Paying Agent
to the Holders of any APS called for redemption will be determined as set forth
in Section ____ of Part I of the Articles Supplementary.
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IV. THE PAYING AGENT AS TRANSFER AGENT AND REGISTRAR
4.1 ORIGINAL ISSUE OF SHARE CERTIFICATES
On the Date of Original Issue for any Preferred Share, one certificate for
each series of APS shall be issued by the Fund and registered in the name of
[Nominee], as nominee of the Securities Depository, and countersigned by the
Paying Agent.
4.2 REGISTRATION OF TRANSFER OR EXCHANGE OF SHARES
Shares of each series of APS shall be registered solely in the name of the
Securities Depository or its nominee.
4.3 REMOVAL OF LEGEND
Any request for removal of a legend indicating a restriction on transfer
from a certificate evidencing APS shall be accompanied by an opinion of counsel
stating that such legend may be removed and such shares may be transferred free
of the restriction described in such legend, said opinion to be delivered under
cover of a letter from a Fund Officer authorizing the Paying Agent to remove the
legend on the basis of said opinion.
4.4 LOST, STOLEN OR DESTROYED SHARE CERTIFICATES
The Paying Agent shall issue and register replacement certificates for
certificates represented to have been lost, stolen or destroyed, upon the
fulfillment of such requirements as shall be deemed appropriate by the Fund and
by the Paying Agent, subject at all times to provisions of law, the Articles
Supplementary governing such matters and resolutions adopted by the Fund with
respect to lost, stolen or destroyed securities. The Paying Agent may issue new
certificates in exchange for and upon the cancellation of mutilated
certificates. Any request by the Fund to the Paying Agent to issue a replacement
or new certificate pursuant to this Section 4.4 shall be deemed to be a
representation and warranty by the Fund to the Paying Agent that such issuance
will comply with provisions of applicable law and the Articles Supplementary and
resolutions of the Fund.
4.5 DISPOSITION OF CANCELED CERTIFICATES; RECORD RETENTION
The Paying Agent shall retain share certificates which have been canceled
in transfer or in exchange and accompanying documentation in accordance with
applicable rules and regulations of the Securities and Exchange Commission (the
"Commission") for at least two calendar years from the date of such
cancellation. The Paying Agent, upon written request by the Fund, shall afford
to the Fund, its agents and counsel access at reasonable times during normal
business hours to review and make extracts or copies (at the Fund's sole cost
and expense) of such certificates and accompanying documentation. Upon the
expiration of this two-year period, the Paying Agent shall deliver to the Fund
the canceled certificates and accompanying documentation. The Paying Agent also
shall undertake to furnish to the Commission, upon demand, either at its
principal office or at any regional office, complete, correct and current hard
copies of any and all such records. Thereafter, such records shall not be
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destroyed by the Fund without the approval of the Paying Agent, which approval
shall not be withheld unreasonably, but will be safely stored for possible
future reference.
4.6 SHARE REGISTER
The Paying Agent shall maintain the share register, which shall contain a
list of the Holders, the number of shares held by each Holder and the address of
each Holder. The Paying Agent shall record in the share register any change of
address of a Holder upon notice by such Holder. In case of any written request
or demand for the inspection of the share register or any other books of the
Fund in the possession of the Paying Agent, the Paying Agent will notify the
Fund and secure instructions as to permitting or refusing such inspection. The
Paying Agent reserves the right, however, to exhibit the share register or other
records to any person in case it is advised by its counsel that its failure to
do so would be unlawful.
4.7 RETURN OF FUNDS
Any funds deposited with the Paying Agent by the Fund for any reason under
this Agreement, including for the payment of dividends or the redemption of APS,
that remain with the Paying Agent after sixty days shall be repaid to the Fund
upon written request by the Fund.
V. REPRESENTATIONS AND WARRANTIES
5.1 REPRESENTATIONS AND WARRANTIES OF THE FUND
The Fund represents and warrants to the Auction Agent that:
(i) the Fund has been duly organized and is validly existing as a
corporation under, and by virtue of, the laws of State of Maryland and has full
power to execute and deliver this Agreement and to authorize, create and issue
the APS;
(ii) the Fund is registered with the Commission under the 1940
Act as a closed-end, diversified, management investment company;
(iii) assuming this Agreement has been duly and validly
authorized and executed by the Auction Agent, this Agreement has been duly and
validly authorized, executed and delivered by the Fund and constitutes the
legal, valid and binding obligation of the Fund, enforceable against the Fund in
accordance with its terms, subject to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting creditors' rights
and to general equitable principles;
(iv) the form of the certificates evidencing the APS comply with
all applicable laws of the State of Maryland;
(v) the APS have been duly and validly authorized by the Fund
and, upon completion of the initial sale of the APS and receipt of payment
therefor, will be validly issued by the Fund, fully paid and nonassessable;
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(vi) at the time of the offering of the APS, the shares offered
will be registered under the Securities Act and no further action by or before
any governmental body or authority of the United States or of any state thereof
is required in connection with the execution and delivery of this Agreement or
will be required in connection with the issuance of the APS, except such action
as required by applicable state securities laws;
(vii) the execution and delivery of this Agreement and the
issuance and delivery of the APS do not and will not conflict with, violate
or result in a breach of the terms, conditions or provisions of, or
constitute a default under, the Agreement and Articles of Incorporation, as
supplemented from time to time, any order or decree of any court or public
authority having jurisdiction over the Fund or any mortgage, indenture,
contract, agreement or undertaking to which the Fund is a party or by which
it is bound the effect of which conflict, violation, default or breach would
be material to the Fund; and
(viii) no taxes are payable upon or in respect of the execution
of this Agreement or will be payable upon or in respect of the issuance of the
APS.
5.2 REPRESENTATIONS AND WARRANTIES OF THE AUCTION AGENT
The Auction Agent represents and warrants to the Fund that:
(i) The Auction Agent is duly organized and is validly existing
as a banking corporation in good standing under the laws of the State of
New
York and has the corporate power to enter into and perform its obligations under
this Agreement; and
(ii) Assuming this Agreement has been duly and validly authorized
and executed by the Fund, this Agreement has been duly and validly authorized,
executed and delivered by the Auction Agent and constitutes the legal, valid and
binding obligation of the Auction Agent, enforceable against the Auction Agent
in accordance with its terms, subject to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or affecting creditors'
rights and to general equitable principles.
VI. THE AUCTION AGENT
6.1 DUTIES AND RESPONSIBILITIES
(a) The Auction Agent is acting solely as agent for the Fund hereunder
and owes no fiduciary duties to any Person except as provided by this Agreement.
(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
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be liable for any error of judgment made in good faith unless the Auction Agent
shall have been negligent in ascertaining the pertinent facts.
6.2 RIGHTS OF THE AUCTION AGENT
(a) The Auction Agent may conclusively rely upon, and shall be
protected in acting or refraining from acting upon, any communication authorized
by this Agreement and any written instruction, notice, request, direction,
consent, report, certificate, share certificate or other instrument, paper or
document reasonably 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 reasonably believes in good faith 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 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 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, 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.
6.3 COMPENSATION, EXPENSES AND INDEMNIFICATION
(a) The Fund shall pay to the Auction Agent from time to time
compensation for all services rendered by it under this Agreement and under the
Broker-Dealer Agreements as shall be set forth in a separate writing signed by
the Fund and the Auction Agent.
(b) The Fund shall reimburse the Auction Agent upon its request for
all reasonable expenses, disbursements and advances incurred or made by the
Auction Agent in accordance with any provision of this Agreement and of the
Broker-Dealer Agreements (including the compensation, expenses and disbursements
of its agents and counsel), except any expense, disbursement or advance
attributable to its negligence or bad faith. In no event shall the Auction Agent
be responsible or liable for special, indirect or consequential loss or damage
of any kind whatsoever (including, but not limited to, loss of profit), even if
the Auction Agent has been advised of the likelihood of such loss or damage and
regardless of the form of action.
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(c) The Fund shall indemnify the Auction Agent for and hold it
harmless against any loss, liability or expense incurred without negligence or
bad faith on its part, arising out of or in connection with its agency under the
Agreement and the Broker-Dealer Agreements, including the costs and expenses of
defending itself against any such claim or liability in connection with its
exercise or performance of any of its duties hereunder and thereunder.
6.4 AUCTION AGENT'S DISCLAIMER
The Auction Agent makes no representation as to the validity or
adequancy of the Agreement, the Broker-Dealer Agreements or the APS of any
series except that the Auction Agent hereby represents that the Agreement has
been duly authorized, executed and delivered by the Auction Agent and
constitutes a legal and binding obligation of the Auction Agent.
VII. MISCELLANEOUS
7.1 TERM OF AGREEMENT
(a) The term of this Agreement is unlimited unless it shall be
terminated as provided in this Section 7.1. The Fund may terminate this
Agreement at any time by so notifying the Auction Agent, provided that, if any
APS remain outstanding, the Fund shall have entered into an agreement with a
successor auction agent. The Auction Agent may terminate this Agreement upon
prior notice to the Fund on the date specified in such notice, which date shall
be no earlier than 45 days after delivery of such notice. If the Auction Agent
terminates this Agreement while any APS remain outstanding, the Fund shall use
its best efforts to enter into an agreement with a successor auction agent
containing substantially the same terms and conditions as this Agreement.
(b) Except as otherwise provided in this Section 7.1(b), the
respective rights and duties of the Fund and the Auction Agent under this
Agreement shall cease upon termination of this Agreement. The Fund's
representations, warranties, covenants and obligations to the Auction Agent
under Sections 5.1 and 6.3 hereof shall survive the termination hereof. The
Auction Agent's representations, warranties, covenants and obligations under
Section 6.1 shall survive the termination hereof. Upon termination of the
Agreement with respect to any series of APS, the Auction Agent shall, at the
Fund's request, promptly deliver to the Fund copies of all books and records
maintained by it with respect to APS in connection with its duties hereunder and
to any successor Auction Agent any funds then held by the Auction Agent for the
benefit of the Holders of APS or the Fund.
7.2 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 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 at its address or telecopier number set forth below:
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If to the Fund, [ISSUER NAME]
addressed to:
If to the Auction Agent, Deutsche Bank Trust Company Americas
addressed to: Corporate Trust & Agency Services
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: 212-797-8600
Telephone No.: ▇▇▇-▇▇▇-▇▇▇▇
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 the Fund by a Fund Officer and on
behalf of the Auction Agent by an Authorized Officer.
7.3 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, except for agreements
relating to the compensation of the Auction Agent.
7.4 BENEFITS
Nothing herein, express or implied, shall give to any Person, other than
the Fund, the Auction Agent and their respective successors and assigns, any
benefit of any legal or equitable right, remedy or claim hereunder.
7.5 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 hereto to exercise any right or remedy
hereunder in the event of a breach hereof by the other party shall not
constitute a waiver of any such right or remedy with respect to any subsequent
breach.
7.6 SUCCESSORS AND ASSIGNS
The Agreement shall be binding upon, inure to the benefit of, and be
enforceable by, the respective successors and assigns of each of the Fund and
the Auction Agent. This Agreement may not be assigned by either party hereto
absent the prior written consent of the other party, which consent shall not be
unreasonably withheld.
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7.7 SEVERABILITY
If any clause, provision or section hereof 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 of
the remaining clauses, provisions or sections hereof.
7.8 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.
7.9 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.
[SIGNATURE PAGES FOLLOW]
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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.
[ISSUER NAME]
By:
-------------------------------
Name:
Title:
DEUTSCHE BANK TRUST
COMPANY AMERICAS
By:
-------------------------------
Name:
Title:
16
EXHIBIT A
FORM OF BROKER-DEALER AGREEMENT
