Exhibit 99(k)(3)
ADMINISTRATIVE SERVICES AGREEMENT
WESTERN ASSET/CLAYMORE U.S. TREASURY INFLATION
PROTECTED SECURITIES FUND
AGREEMENT made this 25th day of September, 2003 by and between Western
Asset/Claymore U.S. Treasury Inflation Protected Securities Fund (the "Fund"), a
Massachusetts business trust, and Xxxx Xxxxx Fund Adviser, Inc.
("Administrator"), a Maryland corporation registered as an investment adviser
under the Investment Advisers Act of 1940.
WHEREAS, the Fund is a closed-end investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Fund wishes to retain the Administrator to provide it with
certain administrative services; and
WHEREAS, the Administrator is willing to furnish such services on the terms
and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed as follows:
1. APPOINTMENT. The Administrator is hereby appointed as administrator
for the Fund for the period and on the terms set forth in this Agreement. The
Administrator accepts such appointment and agrees to furnish the services herein
set forth for the compensation herein provided.
2. DELIVERY OF DOCUMENTS. The Fund has caused the Administrator to be
provided with copies of each of the following:
(a) The Fund's Amended and Restated Agreement and Declaration of Trust and
all amendments thereto;
(b) The Fund's By-Laws and all amendments thereto;
(c) Resolutions of the Fund's Board of Trustees authorizing the
appointment of the Administrator as administrator for the Fund, and approving
this Agreement;
(d) The Fund's Registration Statement on Form N-2 under the 1940 Act and
Securities Act of 1933, as amended, as filed with the Securities and Exchange
Commission, including all exhibits thereto, relating to the shares of beneficial
interest of the Fund, and all amendments thereto;
(e) The Fund's most recent prospectus(es); and
(f) The Fund's most recent statement(s) of additional information.
The Fund will cause the Administrator to be furnished with copies from time
to time of all amendments of or supplements to the foregoing.
3. ADMINISTRATIVE SERVICES. (a) The Administrator, at its expense, shall
supply the Board of Trustees and officers of the Fund with all statistical
information and reports reasonably required by them and reasonably available to
the Administrator and shall furnish the Fund with office facilities, including
space, furniture and equipment and all personnel reasonably necessary for the
administration of the Fund. The Administrator shall authorize and permit any of
its directors, officers and employees who may be elected as trustees or officers
of the Fund to serve in the capacities in which they are elected.
(a) The Administrator shall oversee the maintenance of all books and
records with respect to the Fund's securities transactions and the keeping of
the Fund's books of accounts in accordance with all applicable federal and state
laws and regulations. In compliance with the requirements of Rule 31a-3 under
the 1940 Act, the Administrator hereby agrees that any records which it
maintains for the Fund are the property of the Fund, and further agrees to
surrender promptly to the Fund or its agents any of such records upon the Fund's
request. The Administrator further agrees to arrange for the preservation of the
records required to be maintained by Rule 31a-1 under the 1940 Act for the
periods prescribed by Rule 31a-2 under the 1940 Act.
(b) The Administrator shall also provide advice and recommendations with
respect to other aspects of the business and affairs of the Fund, and shall
perform such other functions of administration, management and supervision, as
are set forth in Schedule A hereto, as such Schedule may be amended from time to
time in writing by the mutual consent of the parties.
4. SERVICES NOT EXCLUSIVE; INDEPENDENT CONTRACTOR. The Administrator's
services hereunder are not deemed to be exclusive, and the Administrator shall
be free to render similar services to others. It is understood that persons
employed by the Administrator to assist in the performance of its duties
hereunder might not devote their full time to such service. Nothing herein
contained shall be deemed to limit or restrict the right of the Administrator or
any affiliate of the Administrator to engage in and devote time and attention to
other businesses or to render services of any kind or nature to other parties.
Unless otherwise expressly provided by this Agreement, the Administrator shall
be deemed to be an independent contractor.
5. EXPENSES. During the term of this Agreement, the Administrator will
pay all expenses incurred by it in connection with its activities under this
Agreement.
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6. COMPENSATION. For the services which the Administrator will render to
the Fund under this Agreement, the Fund will pay the Administrator a fee, paid
monthly, at an annual rate of $100,000. If this Agreement is terminated as of
any date not the last day of a calendar month, a final fee shall be paid
promptly after the date of termination, which fee shall be based on the
percentage of days of the month during which the Agreement was still in effect.
7. LIMITATION OF LIABILITY. The Administrator assumes no responsibility
under this Agreement other than to render the services called for hereunder in
good faith and without negligence, and shall not be responsible for any action
of the Board of Trustees of the Fund in following or declining to follow any
advice or recommendations of the Administrator; provided, however, that nothing
in this Agreement shall protect the Administrator against any liability to the
Fund or the Fund's shareholders for a loss resulting from willful misfeasance,
bad faith or negligence in the performance of its duties or from reckless
disregard of its obligations or duties under this Agreement.
8. DEFINITIONS. As used in this Agreement, the term "assignment" shall
have the meaning given to it by Section 2(a) of the 1940 Act, subject to such
exemptions as may be granted by the Securities and Exchange Commission by any
rule, regulation or order.
9. DURATION AND TERMINATION. Unless otherwise terminated, this Agreement
shall continue in effect for two years from the date of execution; and shall
continue thereafter on an annual basis, provided that such continuance is
specifically approved at least annually (a) by the vote of a majority of the
Board of Trustees of the Fund, and (b) by the vote of a majority of the Board of
Trustees of the Fund who are not parties to this Agreement or "interested
persons" (as defined in the 0000 Xxx) of the Fund or the Administrator, cast in
person at a meeting called for the purpose of voting on such approval.
Notwithstanding the initial term set forth above, this Agreement may be
terminated by either party hereto (without penalty) at any time upon not less
than 60 days' prior written notice to the other party hereto. This Agreement
will be terminated automatically and immediately in the event of its assignment.
10. FURTHER ACTIONS. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
11. AMENDMENTS. No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, waiver, discharge or
termination is sought.
12. GOVERNING LAW. This Agreement shall be governed by the laws of The
Commonwealth of Massachusetts, without giving effect to any choice or conflict
of law provision or rule that would cause the application of the laws of any
other jurisdiction.
13. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original.
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14. MISCELLANEOUS. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior agreements
and understandings relating to the subject matter hereof. The captions in this
Agreement are included for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect their construction or
effect. Should any part of this Agreement be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Agreement shall not
be affected thereby. Except as otherwise provided herein, this Agreement shall
be binding on and shall inure to the benefit of the parties hereto and their
respective successors.
15. STATUS OF THE FUND AS A MASSACHUSETTS BUSINESS TRUST. A copy of the
Fund's Agreement and Declaration of Trust, as amended, is on file with the
Secretary of the Commonwealth of Massachusetts, and notice is hereby given that
this Agreement has been executed on behalf of the Fund by an officer of the Fund
as an officer and not individually and the obligations of or arising out of this
Agreement are not binding upon any of the Trustees, officers or shareholders of
the Fund individually but are binding only upon the assets and property of the
Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below on the day and year first above
written.
Attest: WESTERN ASSET/CLAYMORE U.S. TREASURY
INFLATION PROTECTED SECURITIES FUND
By: By:
---------------------- ---------------------------------
Name:
Title:
Attest: XXXX XXXXX FUND ADVISER, INC.
By: By:
---------------------- ---------------------------------
Name:
Title:
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SCHEDULE A
DUTIES OF THE ADMINISTRATOR. The Administrator shall perform or arrange for the
performance of the following administrative and clerical services:
(a) Calculate or arrange for the calculation and publication of the
Fund's net asset value daily (or as otherwise requested by the Fund) in
accordance with the Fund's policy as adopted from time to time by the Board of
Trustees;
(b) Provide the Fund with administrative offices and data processing
facilities as well as the services of persons competent to perform such
administrative and clerical functions as are necessary to provide effective
operation of the Fund;
(c) Maintain the Fund's expense budget and monitor expense accruals;
(d) Arrange for payment of the Funds' expenses and the review and
approval of invoices for the Fund's account and submission to a Fund officer for
authorization of payment in a manner to be agreed upon;
(e) Oversee and review calculations of fees paid to the
administrator, the investment adviser, the custodian, the shareholder servicing
agent, the transfer agent and any other entity providing authorized services to
the Fund;
(f) Compute the Fund's total return, expense ratios and portfolio
turnover rate as well as various Fund statistical data as reasonably requested;
(g) Prepare for review and approval by officers of the Fund,
financial information for the Fund's semi-annual and annual reports, proxy
statements and other communications with shareholders required or otherwise to
be sent to Fund shareholders, and arrange for the printing and dissemination of
such reports and communications to shareholders;
(h) Prepare such reports as may reasonably be requested by the Board
of Trustees of the Fund or the Fund's officers relating to the business and
affairs of the Fund as may be mutually agreed upon and not otherwise
appropriately prepared by the Fund's investment adviser, custodian, counsel,
auditors or other service providers;
(i) Prepare, or arrange for preparation, for review, approval and
execution by officers of the Fund, the Fund's federal, state and local income
tax returns, and any other required tax returns, as may be mutually agreed upon;
(j) Calculate the Fund's periodic dividend distributions and annual
net investment income (including net realized short-term capital gain) and net
realized long-term capital gain to determine the Fund's appropriate level of
dividend distributions and the minimum annual distributions to shareholders and
the tax and accounting treatment of such distributions on a per share basis, to
be reviewed by the Fund's auditors;
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(k) Prepare, or arrange for preparation, for review by an officer of
the Fund the Fund's periodic financial reports required to be filed with the
Securities and Exchange Commission (the "SEC") on Form N-SAR and N-CSR and such
other reports, forms or filings, as may be mutually agreed upon;
(l) Prepare, or arrange for preparation, such financial information
and reports as may be required by any stock exchange or exchanges on which the
Fund's shares are listed, and such other information and reports required by
such stock exchang(es) as may be mutually agreed upon;
(m) Prepare such financial information and reports as may be required
by any banks or other institutions from which the Fund borrows funds;
(n) Monitor and report on the Fund's issuance of preferred shares,
including performing, or arranging for the performance of, any tests with
respect to asset coverage or other matters required from time to time by the
rating agencies rating such preferred shares and preparing, or arranging for the
preparation of, maintenance reports in connection therewith as required by the
rating agencies;
(o) Coordinate the performance of administrative and professional
services rendered to the Fund by others, including, without limitation, services
provided by its custodian, registrar, transfer agent, shareholder servicing
agent, dividend disbursing agent and dividend reinvestment plan agent, as well
as accounting, auditing and such other services as may from time to time be
mutually agreed;
(p) Consult as necessary with the Fund's officers, independent
accountants, legal counsel, investment adviser, custodian, accounting agent and
transfer and dividend disbursing agent in establishing the accounting policies
of the Fund;
(q) Review implementation of any stock purchase or dividend
reinvestment programs authorized by the Board of Trustees; and
(r) Provide such assistance to the investment adviser, the custodian,
the shareholder servicing agent and the Fund's legal counsel and auditors as
generally may reasonably be required to properly carry on the business and
operations of the Fund.
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