Exhibit (k)(iv)
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BROKER-DEALER AGREEMENT
BETWEEN
THE BANK OF NEW YORK
AS AUCTION AGENT
AND
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AS BROKER-DEALER
DATED AS OF _________, 2004
RELATING TO
AUCTION MARKET PREFERRED SHARES OF
TS&W / CLAYMORE TAX-ADVANTAGED BALANCED FUND
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BROKER-DEALER AGREEMENT dated as of _________, 2004 (this "Agreement"),
among (i) The Bank of New York, a New York banking corporation, as auction agent
(the "Auction Agent") (not in its individual capacity but solely as agent)
pursuant to authority granted to it in the Auction Agency Agreement and (ii)
each broker-dealer whose name appears on the signature page hereof, as
broker-dealer (together with its successors and assigns as such hereinafter
referred to as "BD").
The TS&W / Claymore Tax-Advantaged Balanced Fund, a Delaware statutory
trust (the "Fund") intends to issue shares of one or more series of Auction
Market Preferred Shares, liquidation preference $25,000 per share (the "AMPS").
The shares of each series of AMPS shall be issued in book-entry form through the
facilities of the Securities Depository. References to "AMPS" in this Agreement
shall refer only to the beneficial interests in the AMPS unless the context
otherwise requires.
The Auction Procedures require the participation of a Broker-Dealer.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Auction Agent and BD agree as
follows:
1. DEFINITIONS AND RULES OF CONSTRUCTION
1.1 TERMS DEFINED BY STATEMENT OF PREFERENCES. Capitalized terms
not defined herein shall have the respective meanings specified in the
Statement.
1.2 TERMS DEFINED HEREIN. As used herein and in the Settlement
Procedures, the following terms shall have the following meanings, unless the
context otherwise requires:
"Agent Member" of any Person shall mean the member of, or
participant in, the Securities Depositary that will act on behalf of a Bidder.
"AMPS" shall mean the preferred shares, par value $.01 per
share, of the Fund designated as its "Auction Market Preferred Shares" and
bearing such further designation as to series as the Board of Trustees of the
Fund or any committee thereof shall specify.
"Auction" shall have the meaning specified in Section 2.1
hereof.
"Auction" Procedures" shall mean the auction procedures
constituting Section 9 of the Statement as of the filing thereof.
"Authorized Officer" of the Auction Agent shall mean each Vice
President, Assistant Vice President and Assistant Treasurer of the Auction Agent
assigned to the Dealing and Trading Group of its Corporate Trust Department and
every other officer or employee of the Auction Agent designated as an
"Authorized Officer" for purposes hereof in a written communication to the Fund.
"Fund Officer" shall mean the Chairman and Chief Executive
Officer, 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 Vice President, each Assistant
Secretary and each Assistant Treasurer of the Fund and every other
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officer or employee of the Fund designated as a "Fund Officer" for purposes
hereof in a notice to the Auction Agent.
"Settlement Procedures" shall mean the Settlement Procedures
attached to the Auction Agency Agreement as Exhibit B.
"Statement" shall mean the Statement of Preferences of Auction
Market Preferred Shares, as the same may be amended, supplemented or modified
from time to time.
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.
(e) This Agreement shall apply separately but equally to all
series of AMPS that may be issued. Sections 1 and 2 hereof shall be read in
conjunction with the Statement and in the case of any conflict between the terms
of any document incorporated herein by reference and the terms hereof, the
Auction Agent shall not be liable for its actions or inaction in accordance with
the terms of this Agreement.
1.4 WARRANTIES OF BD.
(a) BD hereby represents and warrants that this Broker-Dealer
Agreement has been duly authorized, executed and delivered by BD and that,
assuming the due authorization, execution and delivery hereof by the Auction
Agent, this Broker-Dealer Agreement constitutes a valid and binding agreement of
BD, enforceable against it in accordance with its terms. BD's representations
and warranties in this Section 1.4 shall survive the termination of this
Agreement.
(b) BD further represents and warrants that BD is a
registered broker-dealer pursuant to Section 15(b) of the Securities and
Exchange Act of 1934, as amended. BD further represents and warrants that it is
a member of the NASD.
2. THE AUCTIONS
2.1 PURPOSE; INCORPORATION BY REFERENCE OF AUCTION PROCEDURES AND
SETTLEMENT PROCEDURES.
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(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 AMPS for the next Rate Period. Each periodic
implementation of such procedures is hereinafter referred to as an "Auction."
(b) All of the provisions contained in the Auction Procedures
and the Settlement Procedures are incorporated herein by reference in their
entirety and shall be deemed to be a part of this Agreement to the same extent
as if such provisions were fully set forth herein.
(c) BD agrees to act as, and assumes the obligations of and
limitations and restrictions placed upon, a Broker-Dealer under this Agreement.
(d) BD acknowledges and agrees that each provision of the
Auction Procedures that requires BD to perform an obligation or procedure is
hereby incorporated herein by reference and that this Agreement shall constitute
the Fund's instruction, and BD hereby agrees, to perform such obligations and
procedures without further request by or instructions from the Fund.
(e) BD may participate in Auctions for its own account.
2.2 PREPARATION FOR EACH AUCTION.
(a) Not later than 9:30 A.M. on each Auction Date, the
Auction Agent shall notify the Fund and BD of the Maximum Applicable Rate and
the Treasury Index Rate(s) and the LIBOR Rate(s), as the case may be, used to
make such determination.
(b) BD shall cause the Maximum Applicable Rate to be
communicated as promptly as practicable to its customers who hold or may be
interested in acquiring AMPS.
(c) As promptly as practicable after determining each Auction
Date, but not later than 9:15 a.m. on the Business Day preceding such Auction
Date, the Auction Agent shall notify BD, by such means as the Auction Agent
deems practicable, of the scheduled date of such Auction Date. If the Auction
Date for any Auction shall be changed after the Auction Agent has given such
notice or the notice referred to in clause (g) of paragraph 1 of the Settlement
Procedures, the Auction Agent, by such means as the Auction Agent deems
practicable, shall give notice of such change to BD not later than the earlier
of (x) 9:15 a.m. on the Business Day preceding the new Auction Date, and (y)
9:15 a.m. on the original Auction Date. Thereafter, BD shall promptly notify
customers of BD that are Existing Holders of such change in the Auction Date.
(d) If required by applicable law, or requested by the
Auction Agent, BD shall provide a list of Existing Holders based upon inquiries
of those Persons such Broker-Dealer believes are Beneficial Owners as a result
of the most recent Auction to the Auction Agent promptly after any date so
requested by the Auction Agent. 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 other parties hereto, provided that the Auction Agent
reserves the right to disclose any such information if (a) it is ordered to do
so by a court of competent jurisdiction or a regulatory, judicial or
quasi-judicial agency, (b) it is advised by its counsel that its failure to do
so would be
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unlawful or (c) failure to do so would expose the Auction Agent to loss,
liability, claim, damage or expense for which it has not received indemnity
satisfactory to it.
(e) BD agrees to maintain a list of customers relating to a
series of AMPS and to use its best efforts, subject to existing laws and
regulations, to contact the customers on such list whom BD believes may be
interested in participating in the Auction on each Auction Date, as a Potential
Holder or a Potential Beneficial Owner, for the purposes set forth in the
Auction Procedures. Nothing herein shall require BD to submit an Order for any
customer in any Auction.
(f) The Auction Agent's registry of Existing Holders of
shares of a series of AMPS shall be conclusive and binding on BD. BD may inquire
of the Auction Agent between 3:00 p.m. on the Business Day preceding an Auction
for shares of a series of AMPS and 9:30 a.m. on the Auction Date for such
Auction to ascertain the number of shares of such series in respect of which the
Auction Agent has determined BD to be an Existing Holder. If BD believes it is
the Existing Holder of fewer shares of such series than specified by the Auction
Agent in response to BD's inquiry, BD may so inform the Auction Agent of that
belief. BD shall not, in its capacity as Existing Holder of shares of such
series, submit Orders in such Auction in respect of shares of such series
covering in the aggregate more than the number of shares of such series
specified by the Auction Agent in response to BD's inquiry.
2.3 AUCTION SCHEDULE; METHOD OF SUBMISSION OF ORDERS.
(a) The Auction Agent shall conduct Auctions 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
unreasonably withheld. The Auction Agent shall give written notice of any such
change to BD which shall have the right to review such change. Such notice shall
be received one Business Day 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. Auction Agent advises the Fund and
the Broker-Dealer of the applicable Maximum
Applicable Rate and the LIBOR Rate(s) and
Treasury Index Rate(s), as the case may be,
used in determining such Maximum Applicable
Rate, as set forth in Section 2.2(a) hereof.
9:30 a.m. - 1:30 p.m. Auction Agent assembles information
communicated to it by Broker-Dealer as
provided in Section 9(d)(i) of the Auction
Procedures. Submission Deadline is 1:30 p.m.
Not earlier than Auction Agent makes determinations pursuant
1:30 p.m. to Section 9(d)(i) of the Auction Procedures.
By approximately Auction Agent advises the Fund of results of
3:30 p.m. Auction as provided in Section 9(d)(ii) of
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TIME EVENT
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the Auction Procedures. Submitted Bids and
Submitted Sell Orders are accepted and
rejected in whole or in part and AMPS are
allocated as provided in Section 9(e) of the
Auction Procedures. Auction Agent gives
notice of Auction results as set forth in
paragraph 1 of the Settlement Procedures.
(b) BD may designate one or more individuals in its
organization who will coordinate its procedures in connection with Auctions and
purchases and sales of shares of any series of AMPS.
(c) BD agrees to handle its customers' order in accordance
with its duties under applicable securities laws and rules.
(d) To the extent that pursuant to Section 9(e) of the
Auction Procedures of the Fund, BD continues to hold, sells or purchases a
number of shares that is fewer than the number of shares in an Order submitted
by BD to the Auction Agent in which BD designated itself as an Existing Holder
or Potential Holder in respect of customer Orders, BD shall make appropriate pro
rata allocations among its customers for which it submitted Orders of similar
tenor. If as a result of such allocations, any Beneficial Owner would be
entitled or required to sell, or any Beneficial Owner would be entitled or
required to purchase, a fraction of a AMPS on any Auction Date, BD shall, in
such manner as it shall determine in its sole discretion, round up or down the
number of AMPS to be purchased or sold on such Auction Date by any Beneficial
Owner or Potential Beneficial Owner on whose behalf BD submitted an Order so
that the number of shares so purchased or sold by each such Beneficial Owner or
Potential Beneficial Owner on such Auction Date shall be whole shares.
(e) BD shall submit Orders to the Auction Agent in writing in
substantially the form attached hereto as Exhibit A. BD shall submit separate
Orders to the Auction Agent for each Potential Holder or Existing Holder on
whose behalf BD is submitting an Order and shall not net or aggregate the Orders
of Potential Holders or Existing Holders on whose behalf BD is submitting
Orders.
(f) BD shall deliver to the Auction Agent a written notice,
substantially in the form attached hereto as Exhibit B, of transfers of AMPS
made through BD by an Existing Holder to another Person other than pursuant to
an Auction and a written notice, substantially in the form attached hereto as
Exhibit C, of the failure of any AMPS to be transferred to or by any Person that
purchased or sold AMPS through BD pursuant to an Auction. The Auction Agent is
not required to accept any notice delivered pursuant to the terms of the
foregoing sentence with respect to an Auction unless it is received by the
Auction Agent by 3:00 p.m. on the Business Day next preceding the applicable
Auction Date.
2.4 NOTICES.
(a) On each Auction Date, the Auction Agent shall notify BD
by telephone or facsimile (or other electronic means acceptable to both parties)
of the results of the
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Auction as set forth in paragraph (a) of the Settlement Procedures. By
approximately 11:30 a.m. on the Business Day next succeeding such Auction Date,
the Auction Agent shall notify BD in writing of the disposition of all Orders
submitted by BD in the Auction held on such Auction Date. 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 1:30 p.m., and as a result the notice set forth in this
Section 2.4 will occur earlier.
(b) BD shall notify each Existing Holder or Potential Holder
on whose behalf BD has submitted an Order as set forth in paragraph 2 of the
Settlement Procedures and take such other action as is required of BD pursuant
to the Settlement Procedures.
2.5 DESIGNATION OF SPECIAL RATE PERIOD.
(a) If the Board of Trustees of the Fund proposes to
designate any subsequent Rate Period of any series of AMPS of the Fund as a
Special Rate Period and the Fund delivers to its Auction Agent a notice of such
proposed Special Rate Period in the form of Exhibit C to the Auction Agency
Agreement, and BD is a Broker-Dealer for such series, such Auction Agent shall
deliver such notice to BD as promptly as practicable after its receipt of such
notice from the Fund.
(b) If the Board of Trustees of the Fund determines to
designate such succeeding subsequent Rate Period as a Special Rate Period, and
the Fund delivers to its Auction Agent a notice of such Special Rate Period in
the form of Exhibit D to the Auction Agency Agreement not later than 11:00 a.m.
on the second Business Day next preceding the first day of such proposed Special
Rate Period, and BD is a Broker-Dealer for such series, such Auction Agent shall
deliver such notice to BD not later than 3:00 p.m. on such second Business Day.
(c) If the Fund shall deliver to its Auction Agent a notice
not later than 11:00 a.m. on the second Business Day next preceding the first
day of any proposed Special Rate Period stating that the Fund has determined not
to exercise its option to designate such succeeding subsequent Rate Period as a
Special Rate Period, in the form of Exhibit E to the Auction Agency Agreement,
or shall fail to timely deliver either such notice or a notice in the form of
Exhibit F to the Auction Agency Agreement, and BD is a Broker-Dealer for such
series, such Auction Agent shall deliver a notice in the form of Exhibit F to
the Auction Agency Agreement to BD not later than 3:00 p.m. on such second
Business Day.
2.6 FAILURE TO DEPOSIT.
(a) If: (i) any Failure to Deposit shall have occurred with
respect to shares of any series of AMPS of the Fund during any Rate Period
thereof (other than any Special Rate Period consisting of more than 364 days or
any Rate Period succeeding any Special Rate Period consisting of more than 364
days during which a Failure to Deposit occurred that has not been cured), but,
prior to 12:00 Noon,
New York City time, on the fourth Business Day next
succeeding the date on which such Failure to Deposit occurred, such Failure to
Deposit shall have been cured in accordance with Section 2.8(c) of the Auction
Agency Agreement and the Fund shall have paid to the Auction Agent for such
series the applicable Late Charge as described in Section 2.8(a) of the Auction
Agency Agreement, then, if BD is a Broker-Dealer for such series, such Auction
Agent shall deliver a notice in the form of Exhibit F to the Auction
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Agency Agreement by first-class mail, postage prepaid, to BD not later than one
Business Day after its receipt of the payment from the Fund curing such Failure
to Deposit and such Late Charge.
(b) If: (i) any Failure to Deposit shall have occurred with
respect to shares of any series of AMPS of the Fund during any Rate Period
thereof (other than any Special Rate Period consisting of more than 364 days or
any Rate Period succeeding any Special Rate Period consisting of more than 364
days during which a Failure to Deposit occurred but has not been cured), and,
prior to 12:00 Noon,
New York City time, on the fourth Business Day next
succeeding the date on which such Failure to Deposit occurred, such Failure to
Deposit shall not have been cured as described in Section 2.8(c) of the Auction
Agency Agreement or the Fund shall not have paid to the Auction Agent for such
series the applicable Late Charge described in Section 2.8(a) of the Auction
Agency Agreement; or (ii) any Failure to Deposit shall have occurred with
respect to shares of any series of AMPS of the Fund during a Special Rate Period
consisting of more than 364 days, or during any Rate Period thereof succeeding
any Special Rate Period of more than 364 days during which a Failure to Deposit
occurred that has not been cured, and, prior to 12:00 noon,
New York City time,
on the fourth Business Day preceding the Auction Date for the Rate Period
subsequent to such Rate Period, such Failure to Deposit shall not have been
cured as described in Section 2.8(c) of the Auction Agency Agreement of the Fund
shall not have paid to the Auction Agent for such series the applicable Late
Charge described in Section 2.8(a) of the Auction Agency Agreement; then such
Auction Agent shall deliver the notice it received in the form of Exhibit G to
the Auction Agency Agreement to the Broker-Dealers for such series as soon as
practicable following such fourth Business Day.
2.7 SERVICE CHARGE TO BE PAID TO BD.
(a) No later than 12:00 noon on each Dividend Payment Date
following each Auction, the Auction Agent will pay a service charge from funds
provided by the Fund to each Broker-Dealer on the basis of the purchase price of
AMPS placed by such Broker-Dealer at such Auction. The service charge shall be
(i) in the case of any Auction Date immediately preceding a seven-day or
twenty-eight day Rate Period, the product of (A) a fraction, the numerator of
which is the number of days in such Rate Period (calculated by counting the date
of original issue of such shares to but excluding the next succeeding dividend
payment date of such shares) 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 shares of
outstanding AMPS for which the Auction is conducted and (ii) in the case of any
Special Rate Period, the amount determined by mutual consent of the Fund and any
such Broker-Dealers at the commencement of such Special Rate Period, which shall
be based upon a selling concession that would be applicable to an underwriting
of fixed or variable rate AMPS with a similar final maturity or variable rate
dividend period, respectively.
(b) If the Fund determines to change the rate at which the
Broker-Dealer Fee accrues, the Fund shall mail to the Auction Agent a notice
thereof within two Business Days of such change. Any change in the Broker-Dealer
Fee Rate shall be effective on the Auction Date next succeeding the Auction
Agent's receipt of notice of such change.
2.8 SETTLEMENT.
(a) If any Existing Holder selling AMPS in an Auction fails
to deliver such AMPS (by authorized book-entry), the BD of any Person that was
to have purchased AMPS
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in such Auction may deliver to such Person a number of AMPS that is less than
the number of AMPS that otherwise were to be purchased by such Person. In such
event, the number of AMPS to be so delivered shall be determined by BD. Delivery
of such lesser number of AMPS shall constitute good delivery. Upon the
occurrence of any such failure to deliver AMPS, BD shall deliver to the Auction
Agent a notice in the form attached hereto as Exhibit C. Notwithstanding the
foregoing provisions of this Section 2.8, any delivery or non delivery of AMPS
which represents any departure from the results of an Auction, as determined by
the Auction Agent, shall be of no effect unless and until the Auction Agent
shall have been notified of such delivery or non-delivery in accordance with the
terms of Section 2.2(d)(iii) of the Auction Agency Agreement. The Auction Agent
shall have no duty or liability with respect to enforcement of this Section 2.8.
(b) Neither the Auction Agent nor the Fund shall have any
responsibility or liability with respect to the failure of an Existing Holder, a
Potential Holder or an Agent Member or any of them to deliver AMPS or to pay for
AMPS sold or purchased pursuant to the Auction Procedures or otherwise.
(c) Notwithstanding any provision of the Auction Procedures
or the Settlement Procedures to the contrary, in the event BD is an Existing
Holder with respect to shares of a series of AMPS and the Auction procedures
provide that BD shall be deemed to have submitted a Sell Order in an Auction
with respect to such shares if BD fails to submit an Order in that Auction with
respect to such shares, BD shall have no liability to any Person for failing to
sell such shares pursuant to such a deemed Sell Order if (i) such shares were
transferred by the beneficial owner thereof without notification of such
transfer in compliance with the Auction Procedures or (ii) BD has indicated to
the Auction Agent pursuant to Section 2.2(f) of this Agreement that, according
to BD's records, BD is not the Existing Holder of such shares.
(d) Notwithstanding any provision of the Auction Procedures
or the Settlement Procedures to the contrary, in the event an Existing Holder or
Beneficial Owner of shares of a series of AMPS with respect to whom a
Broker-Dealer submitted a Bid to the Auction Agent for such shares that was
accepted in whole or in part, or submitted or is deemed to have submitted a Sell
Order for such shares that was accepted in whole or in part, fails to instruct
its Agent Member to deliver such shares against payment therefore, partial
deliveries of AMPS that have been made in respect of Potential Holders' or
Potential Beneficial Owners' Submitted Bids for shares of such series that have
been accepted in whole or in part shall constitute good delivery to such
Potential Holders and Potential Beneficial Owners.
3. THE AUCTION AGENT
3.1 DUTIES AND RESPONSIBILITIES.
(a) The Auction Agent is acting solely as a non-fiduciary
agent for the Fund hereunder and owes no duties, fiduciary or otherwise, to any
other Person.
(b) The Auction Agent undertakes to perform such duties and
only such duties as are specifically set forth in this Agreement, and no implied
covenants or obligations shall be read into this Agreement, the Auction Agency
Agreement, Auction Procedures or the Settlement Procedures against the Auction
Agent.
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(c) In the absence of willful misconduct or gross negligence
on its part, the Auction Agent shall not be liable for any action taken,
suffered, or omitted or for any error of judgment made by it in the performance
of its duties under this Agreement. The Auction Agent shall not be liable for
any error of judgment made in good faith unless the Auction Agent shall have
been grossly negligent in ascertaining or failing to ascertain the pertinent
facts. In no event shall the Auction Agent be liable for special, punitive,
indirect or consequential loss or damage of any kind whatsoever (including but
not limited to lost profits), even if the Auction Agent has been advised of the
likelihood of such loss or damage and regardless of the form of action.
(d) The Auction Agent shall not be: (i) required to, and does
not, make any representations or have any responsibilities as to the validity,
accuracy, value or genuineness of any signatures or endorsements, other than its
own; (ii) obligated to take any legal action hereunder that might, in its
judgment, involve any expense or liability, unless it has been furnished with
indemnity satisfactory to the Auction Agent; and (iii) responsible for or liable
in any respect on account of the identity, Fund or rights of any Person (other
than itself and its agents and attorneys) executing or delivering or purporting
to execute or deliver any document under this Agreement or any
Broker-Dealer
Agreement.
3.2 RIGHTS OF THE AUCTION AGENT.
(a) The Auction Agent may conclusively rely and shall be
fully protected in acting or refraining from acting upon any communication
authorized by this Agreement and upon any written instruction, notice, request,
direction, consent, report, certificate, share certificate or other instrument,
paper or document delivered pursuant to this Agreement and reasonably believed
by it to be genuine. The Auction Agent shall not be liable for acting upon any
communication authorized by this Agreement (including, but not limited to, any
made by telephone, telecopier or other means of electronic communication
acceptable to the parties hereto) which the Auction Agent believes in good faith
to have been given by the Fund or by BD. The Auction Agent may record telephone
communications with BD.
(b) 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. The Auction Agent shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed in writing with the Fund.
(c) The Auction Agent may consult with counsel of its choice,
and shall have no liability for acting or refraining from acting in accordance
with advice from such counsel, except as otherwise provided for in this
Agreement.
(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.
(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.
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3.3 AUCTION AGENT'S DISCLAIMER. The Auction Agent makes no
representation as to, and shall have no liability with respect to, the
correctness of the recitals in, or the validity, adequacy or accuracy of, this
Agreement, the Auction Agency Agreement, the Auction Procedures, the offering
material used in connection with the offer and sale of the AMPS or any other
agreement or instrument executed in connection with the transactions
contemplated herein or in any thereof. The Auction Agent shall have no
obligation or liability in respect of the registration or exemption therefrom of
the AMPS under federal or state securities laws in respect of the sufficiency or
the conformity of any transfer of the AMPS pursuant to the terms of the Auction
Agency Agreement, any Broker Dealer Agreement or any other document contemplated
hereby or thereby.
4. MISCELLANEOUS
4.1 TERMINATION. Any party may terminate this Agreement at any
time upon five (5) days' written notice to the other parties, which notice may
be given by facsimile as provided in Section 4.3 hereof; provided that the
Auction Agent will terminate this Agreement only pursuant to written directions
from the Fund to do so. This Agreement shall automatically terminate upon the
redemption of all outstanding AMPS or upon termination of the Auction Agency
Agreement.
4.2 AGENT MEMBER.
(a) BD is, and shall remain for the term of this Agreement, a
member of, or participant in, the Securities Depository (or an affiliate of such
a member or participant).
(b) BD represents that it (or if BD does not act as Agent
Member, one of its affiliates) shall make all dividend payments on the AMPS
available in same-day funds on each Dividend Payment Date to customers that use
BD or affiliate as Agent Member.
4.3 FORCE MAJEURE. No 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; acts of terrorism; epidemics; riots; interruptions, loss
or malfunctions or 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.
4.4 COMMUNICATIONS. Except for (i) communications authorized to be
by telephone pursuant to this Agreement or the Auction Procedures and (ii)
communications in connection with the Auctions (other than those expressly
required to be in writing), all notices, requests and other communications to
any party hereunder shall be in writing (for the purposes of this Agreement,
telecopy or other means of electronic communication acceptable to the parties
shall be deemed to be in writing) and shall be given to such party, addressed to
it, at its address, telecopy number set forth below and, where appropriate
reference the particular Auction to which such notice relates:
If to BD, [ ]
addressed:
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If to the Auction The Bank of
New York
Agent, addressed: Corporate Trust Administration
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Dealing & Trading Group -
Auction Desk
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
If to the Fund, TS&W / Claymore Tax-Advantaged Balanced Fund
addressed: c/o Claymore Advisors, LLC
000 Xxxxx Xxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxxx Xxxxxxx
Telephone No.: 000-000-0000
Facsimile No.: 000-000-0000
or such other address or facsimile number as such party may hereafter specify
for such purpose by written notice to the other parties. Each such notice,
request or communication shall be effective when delivered at the address
specified herein. Communications shall be given on behalf of BD by a BD Officer,
on behalf of the Auction Agent by an Authorized Officer and on behalf of the
Fund by an Authorized Fund Officer. Telephone communications may be recorded.
4.5 ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties relating to the subject matter hereof, and there are no
other representations, endorsements, promises, agreements or understandings,
oral, written or inferred, between the parties relating to the subject matter
hereof.
4.6 BENEFITS. Nothing in this Agreement, express or implied, shall
give to any person, other than the Auction Agent, the Fund and BD and their
respective successors and permitted assigns, any benefit of any legal or
equitable right, remedy or claim under this Agreement.
4.7 AMENDMENT; WAIVER.
(a) This Agreement shall not be deemed or construed to be
modified, amended, rescinded, cancelled or waived, in whole or in part, except
by a written instrument signed by a duly authorized representative of each of
the parties hereto.
(b) Failure of any party to this Agreement to exercise any
right or remedy hereunder in the event of a breach of this Agreement by any
other party shall not constitute a waiver of any such right or remedy with
respect to any subsequent breach.
4.8 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 the parties hereto. This Agreement may not be
assigned by any party hereto absent the prior written consent of the other
parties.
A-11
4.9 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.
4.10 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.
4.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK (INCLUDING
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
NEW YORK). The parties agree
that all actions and proceedings arising out of this Agreement or any of the
transactions contemplated hereby shall be brought in the County of New York and,
in connection with any such action or proceeding, submit to the jurisdiction of,
and venue in, such County. 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 thereby.
A-12
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.
THE BANK OF NEW YORK
as Auction Agent
By:
------------------------------------
Name:
Title:
[ ]
--------------------------
as Broker-Dealer
A-13
Exhibit A
To
BROKER-DEALER
AGREEMENT
AUCTION BID FORM
(Submit only one Order on this Order Form)
TS&W / CLAYMORE TAX-ADVANTAGED BALANCED FUND
Auction Market Preferred Shares ("AMPS")
To: The Bank of New York Date of Auction _____________
Corporate Trust Administration Series of AMPS (indicate by
000 Xxxxxxx Xxxxxx Number Designation)
Xxx Xxxx, Xxx Xxxx 00000 _______
Attention: Corporate Trust Dealing &
Trading Group - Auction Desk
The undersigned Broker-Dealer submits the following Order on behalf of the
Bidder listed below:
Name of Bidder: __________________________________
Bidder placed the Order listed below covering the number of shares
indicated (complete only one blank):
_________________ number of AMPS now held by
Bidder (an Existing Holder), and the Order is a (check one):
/ / Hold Order; or
/ / Bid at a rate of ____%; or
/ / Sell Order;
-- or -
_________________ number of AMPS not now held
by Bidder (a Potential Holder), and the Order is
a Bid at a rate of ______%
Notes:
(1) If submitting more than one Bid for one Bidder, use additional Order Forms.
(2) If one or more Bids covering in the aggregate more than the outstanding
number of AMPS held by any Existing Holder are submitted, such Bids shall
be considered valid in the order of priority set forth in the Auction
Procedures.
(3) A Hold or Sell Order may be placed only by an Existing Holder covering a
number of AMPS not greater than the number of AMPS currently held by such
Existing Holder.
(4) Potential Holders may make Bids only, each of which must specify a rate. If
more than one Bid is submitted on behalf of any Potential Holder, each Bid
submitted shall be a separate Bid with the rate specified.
(5) Bids may contain no more than three figures to the right of the decimal
point (.001 of 1%).
(6) An Order must be submitted in whole AMPS with an aggregate liquidation
preference of $25,000.
Name of Broker-Dealer: __________________________
By: __________________________
A-14
Exhibit B
To
BROKER-DEALER
AGREEMENT
(To be used only for transfers made other than
pursuant to an Auction)
TRANSFER FORM
TS&W / CLAYMORE TAX-ADVANTAGED BALANCED FUND
Auction Market Preferred Shares ("AMPS")
Series _____ AMPS
(indicate by Number Designation)
We are (check one):
/ / the Existing Holder named below; or
/ / the Broker-Dealer for such Existing Holder; or
/ / the Agent Member for such Existing Holder.
We hereby notify you that such Existing Holder will transfer ___
AMPS to ____________________.
TS&W / CLAYMORE TAX-
ADVANTAGED BALANCED FUND
By:
-------------------------------
Name:
Title:
(Name of Existing Holder)
(Name of Broker-Dealer)
(Name of Agent Member)
By:
-------------------------------
Name:
Title:
B-1
Exhibit C
To
BROKER-DEALER
AGREEMENT
(To be used only for failures to deliver
AMPS sold pursuant to an Auction)
NOTICE OF A FAILURE TO DELIVER
TS&W / CLAYMORE TAX-ADVANTAGED BALANCED FUND
Auction Market Preferred Shares ("AMPS")
Series _____ AMPS
(indicate by Number Designation)
Complete either I. or II.
I. We are a Broker-Dealer for ______________ (the "Purchaser"), which
purchased ____ AMPS in the Auction held on __________________ from the
seller of such AMPS.
II. We are a Broker-Dealer for _____________ (the "Seller"), which sold
____ AMPS in the Auction held on ____________________ to the purchaser
of such AMPS.
We hereby notify you that (check one):
__________ the Seller failed to deliver such AMPS to the Purchaser; or
__________ the Purchaser failed to make payment to the Seller upon
delivery of such AMPS.
Name:
-------------------------------
(Name of Broker-Dealer)
By:
---------------------------------
Printed Name:
Title:
C-1
Capitalized terms used in this letter, unless otherwise defined herein,
shall have the meanings set forth in the Offering Documents.
(Name of Purchaser)
By:
----------------------------------
Name:
Title:
Address: ____________________________
_____________________________________
_____________________________________
Dated:
S-1
