EXHIBIT 13 (b)
--------------------------------------------------------------------------------
AUCTION AGENCY AGREEMENT
between
VAN XXXXXX XXXXXXX TRUST
FOR INVESTMENT GRADE NEW YORK MUNICIPALS
and
BANKERS TRUST COMPANY
Dated as of June 10, 1992
Relating to
Auction Preferred Shares
of
VAN XXXXXX XXXXXXX TRUST FOR
INVESTMENT GRADE NEW YORK MUNICIPALS
--------------------------------------------------------------------------------
TABLE OF CONTENTS
PAGE
----
SECTION 1 DEFINITIONS AND RULES OF CONSTRUCTION 1
1.1 Terms Defined by Reference to
APS Provisions . . . . . . . . . . . . . . . . . 1
Terms Defined Herein 1
Rules of Construction 3
SECTION 2 THE AUCTION 3
2.1 Purpose; Incorporation by Reference of Auction
Procedures and Settlement Procedures . . . . . . 3
Preparation of Each Auction; Maintenance of
Registry of Beneficial Owners . . . . . . . . . 4
2.3 Information Concerning Rates 7
Auction Schedule 11
Designation of Special Dividend Period 12
Allocation of Taxable Income 14
Failure to Deposit 14
Broker-Dealers 17
2.9 Ownership of APS 18
Access to and Maintenance of
Auction Records . . . . . . . . . . . . . . . . . . . 18
2.11 Dividend and Redemption Price Deposit 18
SECTION 3 THE AUCTION AGENT AS DIVIDEND
AND REDEMPTION PRICE DISBURSING AGENT 18
SECTION 4 THE AUCTION AGENT AS TRANSFER AGENT
AND REGISTRAR . . . . . . . . . . . . . . . . . . . . . . 19
Issue of Share Certificates 19
PAGE
----
Registration of Transfer of Shares 19
Removal of Legend on Restricted Shares 19
4.4 Lost Share Certificates 20
Disposition of Cancelled
Certificates; Record Retention 20
Share Transfer Books 20
Return of Funds 21
SECTION 5 REPRESENTATIONS AND WARRANTIES OF THE FUND 21
SECTION 6 THE AUCTION AGENT 22
Duties and Responsibilities 22
Rights of the Auction Agent 23
Auction Agent's Disclaimer 23
Compensation, Expenses and
Indemnification . . . . . . . . . . . . . . . . . 24
SECTION 7 MISCELLANEOUS 24
Term of Agreement 24
Communications 25
7.3 Entire Agreement 26
7.4 Benefits 26
7.5 Amendment; Waiver 26
7.6 Successors and Assigns 26
7.7 Limitation of Liability 27
2
PAGE
----
7.8 Severability 27
7.9 Execution in Counterparts 27
7.10 Governing Law 27
EXHIBITS
EXHIBIT A - Broker-Dealer Agreement
EXHIBIT B - Form of Master Purchaser's Letter
EXHIBIT C - Settlement Procedures
EXHIBIT D - Form of APS Provisions
EXHIBIT E - Form of Notice of Auction Dates
EXHIBIT F - Form of Notice of Proposed Change of Length of Rate Period
EXHIBIT G - Form of Notice of Change of Length of Rate Period
EXHIBIT H - Form of Notice of Determination Not to Change Length of Rate Period
EXHIBIT I - Form of Notice of Cure of Failure to Deposit
EXHIBIT J - Form of Notice of Subsequent Cure of Failure to Deposit
EXHIBIT K - Form of Notice of Capital Gain and Taxable Ordinary Income Dividend
3
AUCTION AGENCY AGREEMENT dated as of June 10, 1992 between VAN XXXXXX
XXXXXXX TRUST FOR INVESTMENT GRADE NEW YORK MUNICIPALS, a Massachusetts business
trust (the "Fund"), and Bankers Trust Company, a New York banking corporation
(the "Auction Agent").
WHEREAS, the Fund proposes to issue preferred shares of beneficial
interest, par value $.01 per share, liquidation preference $50,000 per share,
designated Auction Preferred Shares (the "APS") pursuant to the APS Provisions
(as hereinafter defined) and desires that the Auction Agent perform certain
duties in connection with the APS upon the terms and subject to the conditions
of this Agreement, and hereby appoints the Auction Agent to act in the
capacities set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the Fund and the Auction Agent agree as follows:
1. Definitions and Rules of Construction.
1.1 Terms Defined by Reference to APS Provisions. Capitalized terms not
defined herein shall have the respective meanings specified in the APS
Provisions.
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:
(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
and is identified as such in such Bidder's Master Purchaser's Letter.
(b) "APS Provisions" shall mean the Certificate of Vote of
the Fund's Board of Trustees establishing the APS pursuant to the Declaration of
Trust of the Fund and attached hereto as Exhibit D.
(c) "Auction" shall have the meaning specified in Section
2.1 hereof.
(d) "Auction Procedures" shall mean the auction procedures
constituting Part II of the form of APS Provisions.
(e) "Authorized Officer" shall mean each Senior Vice
President, Vice President, Assistant Vice President, Assistant Treasurer and
Assistant Secretary of the Auction Agent and every other officer or employee of
the Auction Agent designated as an "Authorized Officer" for purposes hereof in a
communication 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
among the Fund, the Auction Agent and a Broker-Dealer substantially in the form
attached hereto as Exhibit A.
(h) "Existing Holder," when used with respect to any of the
APS, shall mean a Person who has signed a Master Purchaser's Letter and is
listed as the beneficial owner of such APS in the records of the Auction Agent.
(i) "Fund Officer" shall mean the Chairman of the Board of
Trustees 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) "Master Purchaser's Letter" shall mean a letter
addressed to the Fund, the Auction Agent, a Broker-Dealer and an Agent Member,
substantially in the form attached hereto as Exhibit B.
(k) "Potential Holder," when used with respect to any of
the APS, shall mean any Person, including any Existing Holder of such APS, (i)
who shall have executed a Master Purchaser's Letter and (ii) who may be
interested in acquiring such APS (or, in the case of an Existing Holder of such
APS, additional APS).
2
(l) "Settlement Procedures" shall mean the Settlement
Procedures attached hereto as Exhibit C.
(m) "Underwriters" shall mean Xxxxxxx, Sachs & Co., Xxxxx
Xxxxxx, Xxxxxx Xxxxx & Co. Incorporated, Prudential Securities Incorporated,
X.X. Xxxxxxx & Sons, Inc., Xxxxxxxxxxx & Co., Inc. and BT Securities Corporation
and any other person named as an underwriter of the APS in the Underwriting
Agreement or any schedule thereto.
(n) "Underwriting Agreement" shall mean the Underwriting
Agreement dated June 5, 1992 among the Fund and the Underwriters.
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.
2. The Auction.
2.1 Purpose; Incorporation by Reference of Auction Procedures and
Settlement Procedures. (a) The APS Provisions provide that the Applicable Rate
per annum for the APS for each Subsequent Dividend Period after the initial
Dividend Period with respect to the APS shall, except under certain conditions,
be equal to the rate per annum that a bank or trust company appointed by the
Fund advises has resulted on the Business Day preceding the first day of such
Subsequent Dividend Period from implementation of the Auction Procedures for
such APS. Each periodic implementation of the Auction Procedures is
3
hereinafter referred to as an "Auction." The Board of Trustees has adopted a
resolution appointing Bankers Trust Company as Auction Agent for purposes of the
Auction Procedures for the APS. The Auction Agent accepts such appointment and
agrees to 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
each Subsequent Dividend Period thereof for which the Applicable Rate is to be
determined by 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 hereof to the same extent as if
such provisions were fully set forth herein.
2.2 Preparation of Each Auction; Maintenance of Registry of Beneficial
Owners. (a) Not later than seven days prior to the first Auction Date for the
APS, the Fund shall provide the Auction Agent with a list of the Broker-Dealers
and a manually signed copy of each Broker-Dealer Agreement for execution by the
Auction Agent. Not later than seven days prior to any Auction Date for any of
the APS for which any change in such list of Broker-Dealers is to be effective,
the Fund will notify the Auction Agent in writing of such change and, if any
such change involves the addition of a Broker-Dealer to such list, shall cause
to be delivered to the Auction Agent for execution by the Auction Agent a
Broker-Dealer Agreement signed by such Broker-Dealer; provided, however, that if
the Fund proposes to designate any Special Dividend Period of any of the APS
pursuant to Section 4 of Part I of the APS Provisions, not later than 11:00
A.M., New York City time, on the Business Day next preceding the Auction next
preceding the first day of such Special Dividend Period, the Fund shall provide
the Auction Agent with a list of the Broker-Dealers for such APS and a manually
signed copy of each Broker-Dealer Agreement or a new Schedule A to the
Broker-Dealer Agreement (which Schedule A shall replace and supersede any
previous Schedule A to such Broker-Dealer Agreement) with each Broker-Dealer for
such APS. The Auction Agent and the Fund shall have entered into a Broker-Dealer
Agreement with each Broker-Dealer prior to the participation of any such
Broker-Dealer in any Auction.
4
(b) In the event that any Auction Date for any of the APS
shall be changed after the Auction Agent shall have given the notice referred to
in clause (vi) of paragraph (a) of the Settlement Procedures, or after the
notice referred to in Section 2.5(a) hereof, if applicable, the Auction Agent,
by such means as the Auction Agent deems practicable, shall give notice of such
change to the Broker-Dealers for such APS 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) (i) The Auction Agent shall maintain a registry of the
beneficial owners of the APS who shall constitute Existing Holders of such
APS for purposes of Auctions and shall indicate thereon the identity of the
respective Broker-Dealer of each Existing Holder, if any, on whose behalf
such Broker-Dealer submitted the most recent Order in any Auction which
resulted in such Existing Holder continuing to hold or purchasing such APS.
The Auction Agent shall keep such registry current and accurate. 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 a list of the initial Existing
Holders of the APS, the number of APS 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
APS. The Auction Agent shall advise the Fund in writing whenever the number
of Existing Holders is 500 or more. The Auction Agent may rely upon, as
conclusive evidence of the identities of the Existing Holders of any of the
APS, (A) such list, (B) the results of Auctions and (C) notices from any
Existing Holder, the Agent Member of any Existing Holder or the
Broker-Dealer of any Existing Holder as described in the first sentence of
Section 2.2(c)(iii) hereof.
(ii) In the event of any partial redemption of any of
the APS, the Auction Agent shall, at least two Business Days prior to the
next Auction for such APS, request the Agent Member of each Existing Holder
of such APS to disclose to the Auction Agent (upon
5
selection by such Agent Member of the Existing Holders whose APS are to be
redeemed) the number of APS, if any, of such Existing Holder which are
subject to such redemption, provided the Auction Agent has been furnished
with the name and telephone number of a person or department at such Agent
Member from which it shall request such information. Upon any refusal of an
Agent member to release such information, the Auction Agent shall deliver
to such Agent Member a facsimile copy of the Existing Holder's Master
Purchaser's Letter, which authorizes and instructs such Agent Member to
release such information to the Auction Agent. 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 the beneficial owner of the number of APS shown in
the Auction Agent's registry.
(iii) The Auction Agent shall be required to register a
transfer of APS from an Existing Holder of such APS to another Person only
if such transfer is made to a Person that has delivered, or on whose behalf
has been delivered, a signed Master Purchaser's Letter to the Auction Agent
and if (A) such transfer is pursuant to an Auction or (B) the Auction Agent
has been notified in writing (I) in a notice substantially in the form of
Exhibit D to the Broker-Dealer Agreements by such Existing Holder, the
Agent Member of such Existing Holder or the Broker-Dealer of such Existing
Holder of such transfer or (II) in a notice substantially in the form of
Exhibit E to the Broker-Dealer Agreements by the Broker-Dealer of any
Person that purchased or sold such APS in an Auction of the failure of such
APS to be transferred as a result of such Auction. The Auction Agent is not
required to accept any such notice for an Auction unless it is received by
the Auction Agent by 3:00 P.M. on the Business Day preceding such Auction.
6
(iv) The Auction Agent is not required to accept the
Master Purchaser's Letter of any Potential Holder who wishes to submit a
Bid for the first time in an Auction or of any Potential Holder or Existing
Holder who wishes to amend its Master Purchaser's Letter unless such letter
or amendment is received by the Auction Agent by 3:00 P.M. on the Business
Day preceding such Auction.
(d) The Auction Agent may request the Broker-Dealers, as
set forth in the Broker-Dealer Agreements, to provide the Auction Agent with a
list of their respective customers that such Broker-Dealers believe are Existing
Holders of APS. The Auction Agent shall keep confidential such registry of
Existing Holders and shall not disclose the identities of the Existing Holders
of such APS to any Person other than the Fund and the Broker-Dealer that
provided such information.
2.3 Information Concerning Rates. (a) The Applicable Percentage on the
date of this Agreement for APS is 110%. If there is any change in the credit
rating of APS by either of the rating agencies (or substitute or successor
rating agencies) referred to in the definition of "Applicable Percentage"
resulting in any change in the Applicable Percentage for APS after the date of
this Agreement, the Fund shall notify the Auction Agent in writing of such
change in the Applicable Percentage prior to 12:00 Noon on the Business Day
prior to the next Auction Date for the APS succeeding such change. If the Fund
designates all or a portion of any dividend on the APS to consist of net capital
gains or other income taxable for federal income tax purposes, it will indicate,
in its notice in the form of Exhibit K hereto to the Auction Agent pursuant to
Section 2.6 hereof, the Applicable Percentage for such APS to be in effect for
the Auction Date on which the dividend rate for such dividend is to be fixed. In
determining the Maximum Rate for the APS on any Auction Date as set forth in
Section 2.3(b)(i) hereof, the Auction Agent shall be entitled to rely on the
last Applicable Percentage for APS of which it has most recently received notice
from the Fund (or, in the absence of such notice, the percentage set forth in
the first sentence of this paragraph (a)), except that if the Fund shall have
notified the Auction Agent of an Applicable Percentage to be in effect for an
Auction Date in accordance with the preceding sentence, the Applicable
7
Percentage in effect for the next succeeding Auction Date of the APS shall be,
unless the Fund notifies the Auction Agent of a change in the Applicable
Percentage for such succeeding Auction Date pursuant to this Section 2.3(a), the
Applicable Percentage that was in effect on the first preceding Auction Date for
APS with respect to which the dividend, the rate for which was fixed on such
Auction Date, did not include any net capital gains or other income taxable for
federal income tax purposes.
(b) (i) On each Auction Date for the APS, the Auction Agent
shall determine the Maximum Rate for such APS. The Maximum Rate for the APS
on any Auction Date shall be:
(A) in the case of any Auction Date which is
not the Auction Date immediately prior to the first day of any
proposed Special Dividend Period designated by the Fund pursuant to
Section 4 of Part I of the APS Provisions, the product of (1) the "AA"
Composite Commercial Paper Rate on such Auction Date for the next Rate
Period of such APS and (2) the Applicable Percentage on such Auction
Date, unless such APS have or have had a Special Dividend Period
(other than a Special Dividend Period of 28 Rate Period Days or less)
and an Auction at which Sufficient Clearing Bids existed has not yet
occurred for a Minimum Dividend Period of such APS after such Special
Dividend Period, in which case the higher of:
(1) the dividend rate on such APS for the
then-ending Rate Period, and
(2) the product of (x) the higher of (I)
the "AA" Composite Commercial Paper Rate on such Auction Date for
the then-ending Rate Period of the APS, if such Rate Period is
less than one year, or the Treasury Rate on such Auction Date for
such Rate Period, if such Rate Period is one year or greater, and
8
(II) the "AA" Composite Commercial Paper Rate on such Auction
Date for such Special Dividend Period of the APS, if such Special
Dividend Period is less than one year, or the Treasury Rate on
such Auction Date for such Special Dividend Period, if such
Special Dividend Period is one year or greater, and (y) the
Applicable Percentage on such Auction Date; or
(B) in the case of any Auction Date which is
the Auction Date immediately prior to the first day of any proposed
Special Dividend Period designated by the Fund pursuant to Section 4
of Part I of the APS Provisions, the product of (1) the highest of (x)
the "AA" Composite Commercial Paper Rate on such Auction Date for the
then-ending Rate Period of the APS, if such Rate Period is less than
one year, or the Treasury Rate on such Auction Date for such Rate
Period, if such Rate Period is one year or greater, (y) the "AA"
Composite Commercial Paper Rate on such Auction Date for such Special
Dividend Period of the APS for which the Auction is being held, if
such Special Dividend Period is less than one year, or the Treasury
Rate on such Auction Date for such Special Dividend Period of the APS
for which the Auction is being held, if such Special Dividend Period
is one year or greater, and (z) the "AA" Composite Commercial Paper
Rate on such Auction Date for Minimum Dividend Periods and (2) the
Applicable Percentage on such Auction Date.
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 so determined and the "AA"
Composite Commercial Paper Rate(s) and Treasury Rate(s), as the case may be,
used to make such determination.
9
(ii) From and after a Failure to Deposit by the Fund
during any Rate Period of the APS, until such failure is cured and a late
charge, if applicable, is paid, in accordance with subparagraph (c)(i) of
Section 2 of Part I of the APS Provisions, on the first day of each Rate
Period of the APS the Auction Agent shall determine the Treasury Rate for
such Rate Period, if such Rate Period is one year or greater, and the "AA"
Composite Commercial Paper Rate for Minimum Dividend Periods and Rate
Periods that are less than one year. Not later than 9:30 A.M. on each such
first day, the Auction Agent shall notify the Fund of the applicable "AA"
Composite Commercial Paper Rate and Treasury Rate.
(iii) If any "AA" Composite Commercial Paper Rate or
Treasury Rate, as the case may be, is not quoted on an interest basis, the
Auction Agent shall convert the quoted rate to the interest equivalent
thereof as set forth in the definition of such rate in the APS Provisions
if the rate obtained by the Auction Agent is quoted on a discount basis, or
if such rate is quoted on a basis other than an interest or discount basis
the Auction Agent shall convert the quoted rate to an interest rate after
consultation with the Fund as to the method of such conversion.
(iv) If any "AA" Composite Commercial Paper 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 such "AA" Composite Commercial Paper Rate, the Auction
Agent shall immediately 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 shall promptly advise the Auction Agent of any such selection.
10
(v) If any Treasury Rate is to be based on rates
supplied by U.S. Government Securities Dealers and one or more of the U.S.
Government Securities Dealers shall not provide a quotation for the
determination of such Treasury Rate, the Auction Agent shall immediately
notify the Fund so that the Fund can determine whether to select a
Substitute U.S. Government Securities Dealer or Substitute U.S. Government
Securities Dealers to provide the quotation or quotations not being
supplied by any U.S. Government Securities Dealer or U.S. Government
Securities Dealers. The Fund shall promptly advise the Auction Agent of any
such selection.
(c) The greater of the maximum marginal combined regular
federal and New York individual income tax rate applicable to ordinary income
(taking into account the federal income tax deductibility of state and local
income taxes paid or incurred) or the maximum marginal regular federal corporate
income tax rate (the "Highest Marginal Rate") on the date of this Agreement is
34%. If there is any change in the Highest Marginal Rate, the Fund shall notify
the Auction Agent in writing of such change prior to 12:00 Noon on the Business
Day prior to the next Auction Date for APS succeeding such change. In
determining the Maximum Rate for the APS on any Auction Date, the Auction Agent
shall be entitled to rely on the Highest Marginal Rate of which it has most
recently received notice from the Fund (or, in the absence of such notice, the
percentage set forth in the first sentence of this paragraph (c)).
2.4 Auction Schedule. The Auction Agent shall conduct Auctions 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
unreasonably withheld. The Auction Agent shall give written notice of any such
change to each Broker-Dealer. Such notice shall be given prior to the close of
business on the Business Day next preceding the first Auction Date on which any
such change shall be effective.
Time Event
---- -----
By 9:30 A.M. Auction Agent advises the Fund and
Broker-Dealers of the applicable
Maximum Rate
11
and the "AA" Composite Commercial
Paper Rate(s) and Treasury
Rate(s), as the case may be, used
in determining such Maximum Rate
as set forth in Section 2.3(b)(i)
hereof.
9:30 A.M. - 1:30 P.M. Auction Agent assembles information
communicated to it by Broker-Dealers as
provided in Section 3(a) of the Auction
Procedures. Submission Deadline is
1:30 P.M.
Not earlier than 1:30 P.M. Auction Agent makes determinations
pursuant to Section 4(a) of the Auction
Procedures.
By approximately 3:00 P.M. Auction Agent advises Fund of results of
Auction as provided in Section 4(b) of
the Auction Procedures. Submitted Bids
and Submitted Sell Orders are accepted
and rejected and shares of APS allocated
as provided in Section 5 of the Auction
Procedures. Auction Agent gives notice of
Auction results as set forth in paragraph
(a) of the Settlement Procedures.
2.5 Designation of Special Dividend Period. (a) The APS Provisions will
provide that, subject to the Fund's option to designate a Special Dividend
Period as referred to in paragraph (b) of this Section 2.5, (i) each Rate Period
will consist of six months for the APS and (ii) each Rate Period following a
Rate Period of the APS that is other than a Minimum Dividend Period will be six
months for the APS. Not less than 10 nor more than 20 days prior to the last day
of any such Rate Period that is not a Minimum Dividend Period, (i) the Fund
shall deliver to the Auction Agent a notice of the Auc-
12
tion Date of the next succeeding Auction for the APS in the form of Exhibit E
hereto and (ii) the Auction Agent shall deliver such notice by first-class mail,
postage prepaid, to each Existing Holder of APS at the address specified in such
Existing Holder's Master Purchaser's Letter and to the Broker-Dealers for such
APS as promptly as practicable after its receipt of such notice from the Fund.
(b) Pursuant to the APS Provisions, the Fund may, at its
option, designate a Special Dividend Period for the APS in the manner described
in Section 4 of Part I of the APS Provisions.
(i) If the Fund proposes to designate any succeeding
Subsequent Dividend Period of the APS as a Special Dividend Period of
more than 28 Rate Period Days, (A) the Fund shall deliver to the
Auction Agent a notice of such proposed Special Dividend Period in the
form of Exhibit F hereto not less than 20 nor more than 30 days prior
to the first day of such proposed Special Dividend Period and (B) the
Auction Agent on behalf of the Fund shall deliver such notice by
first-class mail, postage prepaid, to each Existing Holder of APS at
the address specified in such Existing Holder's Master Purchaser's
Letter and to the Broker-Dealers for the APS as promptly as practicable
after its receipt of such notice from the Fund.
(ii) If the Board of Trustees determines to designate
such succeeding Subsequent Dividend Period as a Special Dividend
Period, (A) the Fund shall deliver to the Auction Agent a notice of
such determination in the form of Exhibit G hereto not later than 11:00
A.M. on the second Business Day next preceding the first day of such
proposed Special Dividend Period and (B) the Auction Agent shall
deliver such notice to the Broker-Dealers for the APS not later than
3:00 P.M. on such second Business Day.
(iii) If the Fund shall deliver to the Auction Agent a
notice stating that the Fund has determined not to exercise its option
13
to designate such succeeding Subsequent Dividend Period as a Special
Dividend Period with respect to which it has delivered a notice in the
form of Exhibit F hereto not later than 11:00 A.M. on the second
Business Day next preceding the first day of such proposed Special
Dividend Period, or shall fail to timely deliver either such notice or
a notice in the form of Exhibit G hereto, the Auction Agent shall
deliver a notice in the form of Exhibit H hereto to the Broker-Dealers
for the APS not later than 3:00 P.M. on such second Business Day.
A change in the length of a Rate Period to a Rate Period of more than 28 Rate
Period Days shall not occur if (a) on the Auction Date next preceding the first
day of such Special Dividend Period Sufficient Clearing Bids shall not exist or
(b) a Failure to Deposit shall have occurred prior to such change with respect
to the APS and shall not have been cured in accordance with the APS Provisions.
2.6 Allocation of Taxable Income. The Fund may, at its option,
designate all or a portion of any dividend on the APS to consist of net capital
gains or other income taxable for federal income tax purposes by delivering to
the Auction Agent a notice in the form of Exhibit K hereto of such designation
15 days prior to the Auction Date on which the Applicable rate for such dividend
is to be fixed. The Auction Agent will deliver such notice to the Broker-Dealers
for such series on the Business Day following its receipt of such notice from
the Fund. Within two Business Days after any Auction Date involving the
allocation of income taxable for federal income tax purposes, or retroactively
allocates income taxable for federal income tax purposes as provided in the APS
Provisions, the Auction Agent shall notify each Broker-Dealer for the APS as to
the dollar amount per share of such taxable income and income exempt from
federal income taxation included in the related dividend.
2.7 Failure to Deposit. (a) If:
(i) any Failure to Deposit shall have occurred with
respect to the APS during any Rate Period thereof (other than any
Special Dividend Period, if such Special Divi-
14
dend Period is one year or greater, or any Rate Period succeeding any
Special Dividend Period, if such Special Dividend Period is one year or
greater, during which a Failure to Deposit occurred that has not been
cured); and
(ii) prior to 12:00 Noon, New York City time, on the
third Business Day next succeeding the date on which such Failure to
Deposit occurred, such Failure to Deposit shall have been cured in
accordance with the next succeeding sentence and the Fund shall have
paid to the Auction Agent a late charge equal to the sum of (A) if such
Failure to Deposit consisted of the failure timely to pay to the
Auction Agent the full amount of dividends with respect to any Dividend
Period on the APS, an amount computed by multiplying (1) 200% of the
"AA" Composite Commercial Paper Rate (or Treasury Rate, if applicable)
for the Rate Period during which such Failure to Deposit occurs on the
Dividend Payment Date for such Dividend Period by (2) a fraction, the
numerator of which shall be the number of days for which such Failure
to Deposit has not been cured in accordance with the next succeeding
sentence (including the day such Failure to Deposit occurs and
excluding the day such Failure to Deposit is cured) and the denominator
of which shall be 365, and applying the rate obtained against the
aggregate liquidation preference of the outstanding APS and (B) if such
Failure to Deposit consisted of the failure timely to pay to the
Auction Agent the Optional Redemption Price or Mandatory Redemption
Price, as the case may be, of the APS, if any, for which Notice of
Redemption has been given by the Fund pursuant to paragraph (b) of
Section 3 of Part I of the APS Provisions, an amount computed by
multiplying (x) 200% of the "AA" Composite Commercial Paper Rate (or
Treasury Rate, if applicable) for the Rate Period during which such
Failure to Deposit occurs on the redemption date by (y) a fraction, the
numerator of which shall be the number of days for which such Failure
to Deposit was not cured in accordance with the next succeeding
sentence (including the day such Failure to Deposit occurs
15
and excluding the day such Failure to Deposit was cured) and the
denominator of which shall be 365, and applying the rate obtained
against the aggregate liquidation preference of the outstanding APS to
be redeemed,
then the Auction Agent shall deliver a notice in the form of Exhibit I hereto by
first-class mail, postage prepaid, to the Broker-Dealers not later than one
Business Day after its receipt of the payment from the Fund curing such Failure
to Deposit and such late charge. A Failure to Deposit with respect to the APS
shall have been cured (if such Failure to Deposit is not solely due to the
willful failure of the Fund to make the required payment to the Auction Agent)
with respect to any Rate Period thereof if, not later than 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, the Fund shall have paid to the Auction
Agent (A) all accumulated and unpaid dividends on the APS and (B) without
duplication, the Optional Redemption Price or Mandatory Redemption Price, as the
case may be, for the APS, if any, for which Notice of Redemption has been given
by the Fund pursuant to paragraph (b) of Section 3 of Part I of the APS
Provisions.
(b) If:
(i) any Failure to Deposit shall have occurred with
respect to the APS during a Rate Period thereof (other than any Special
Dividend Period, if such Special Dividend Period is one year or
greater, or any Rate Period succeeding any Special Dividend Period, if
such Special Dividend Period is one year or greater, during which a
Failure to Deposit occurred that has not been cured), and, prior to
12:00 Noon on the third Business Day next succeeding the date on which
such Failure to Deposit occurred, such Failure to Deposit shall not
have been cured within the meaning of the last sentence of Section
2.7(a) hereof and the Fund shall not have paid to the Auction Agent the
late charge described in such Section 2.7(a), but such Failure to
Deposit shall subsequently be so cured; or
16
(ii) any Failure to Deposit shall have occurred with
respect to the APS during a Special Dividend Period, if such Special
Dividend Period is one year or greater, or during any Rate Period
succeeding any Special Dividend Period, if such Special Dividend Period
is one year or greater, during which a Failure to Deposit occurred, and
such Failure to Deposit shall subsequently have been cured within the
meaning of the last sentence of Section 2.7(a) hereof,
then the Auction Agent shall deliver a notice in the form of Exhibit J hereto to
the Broker-Dealers not later than one Business Day after the receipt of the
payment from the Fund during such Failure to Deposit. Notwithstanding the
foregoing, the Auction Agent shall conduct an Auction on an Auction Date which
occurs simultaneously with the date of commencement of a Failure to Deposit.
2.8 Broker-Dealers. (a) Not later than 12:00 Noon on each Auction Date
for the APS, the Fund shall pay to the Auction Agent an amount in cash equal to
the aggregate fees payable to the Broker-Dealers pursuant to Section 2.8 of the
Broker-Dealer Agreements. The Auction Agent shall apply such moneys as set forth
in Section 2.8 of each such Broker-Dealer Agreement.
(b) The Fund shall obtain the consent of the Auction Agent
prior to selecting any Person to act as a Broker-Dealer, which consent shall not
be unreasonably withheld.
(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 the APS after such
termination.
(d) Subject to the Auction Agent's having consented to the
selection of the relevant Broker-Dealer pursuant to Section 2.8(b) hereof, the
Auction Agent shall from time to time enter into such Broker-Dealer Agreements
with one or more Broker-Dealers as the Fund shall request, and shall enter into
such schedules to any such Broker-Dealer Agreements as the Fund shall request,
which schedules, among other things, shall set forth the APS to which such
Broker-Dealer Agreement relates.
17
2.9 Ownership of APS. The Fund shall notify the Auction Agent if the
Fund or any affiliate of the Fund acquires any APS. Neither the Fund nor any
affiliate of the Fund shall submit any order in any Auction for APS, except as
set forth in the next sentence. Any Broker-Dealer that is an affiliate of the
Fund may submit orders in Auctions, but only if such Orders are not for its own
account. For purposes of this Section 2.9, 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 trustee of
the Fund. The Auction Agent shall have no duty or liability with respect to
enforcement of this Section 2.9.
2.10 Access to and Maintenance of Auction Records. The Auction Agent
shall, upon the receipt of prior written notice from the Fund, afford to the
Fund access at reasonable times during normal business hours to all books,
records, documents and other information concerning the conduct and results of
Auctions. The Auction Agent shall maintain records relating to any Auction for a
period of six years after such Auction, and such records shall, in reasonable
detail, accurately and fairly reflect the actions taken by the Auction Agent
hereunder.
2.11 Dividend and Redemption Price Deposit. The Fund shall pay to the
Auction Agent, not later than 12:00 noon, New York City time, (A) on the
Business Day next preceding any Dividend Payment Date, in funds available on
such Dividend Payment Date in The City of New York, New York, the full amount of
any dividend (whether or not earned or declared) to be paid on such Dividend
Payment Date (B) on the Business Day next preceding any redemption date in funds
available on such redemption date in The City of New York, New York, the
Redemption Price to be paid on such redemption date after notice of redemption
is given as set forth in the Certificate of vote.
3. The Auction Agent as Dividend and
Redemption Price Disbursing Agent.
The Auction Agent, as dividend and redemption price disbursing
agent, shall pay to the Holders of APS (i) on each Dividend Payment Date,
dividends on the APS,
18
(ii) on any date fixed for redemption of APS, the Redemption Price of the APS
called for redemption and (iii) any late charge related to any payment of
dividends or Redemption Price, in each case after receipt of the necessary funds
from the Fund with which to pay such dividends, Redemption Price or late charge.
The amount of dividends for any Rate Period for the APS to be paid by the
Auction Agent to the Holders of such shares of such series will be determined by
the Fund as set forth in Section 2 of Part I of the APS Provisions. The
Redemption Price of any APS to be paid by the Auction Agent to the Holders will
be determined by the Fund as set forth in Section 3 of Part I of the APS
Provisions. The Fund shall notify the Auction Agent in writing of a decision to
redeem any APS at least five days prior to the date a notice of redemption is
required to be mailed to the Holders of the APS to be redeemed by paragraph (b)
of Section 3 of Part I of the APS Provisions. Such notice by the Fund to the
Auction Agent shall contain the information required by paragraph (b) of Section
3 of Part I of the APS Provisions to be stated in the notice of redemption
required to be mailed by the Auction Agent to such Holders.
4. The Auction Agent as Transfer Agent and Registrar.
4.1 Issue of Share Certificates. Upon the Date of original Issue o the
APS, one certificate representing all of the APS issued on such date shall be
issued by the Fund and, at the request of the Fund, registered in the name of
Cede & Co. and countersigned by the Auction Agent.
4.2 Registration of Transfer of Shares. The APS shall be registered
solely in the name of the Securities Depository or its nominee.
4.3 Removal of Legend on Restricted Shares. All requests for removal of
legends on any APS indicating restrictions on transfer shall be accompanied by
an opinion of counsel stating that such legends may be removed and such shares
freely transferred, such opinion to be delivered under cover of a letter from a
Fund officer authorizing the Auction Agent to remove the legend on the basis of
said opinion.
19
4.4 Lost Share Certificates. The Auction 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 the Auction Agent, subject at all times to
provisions of law, the By-Laws of the Fund governing such matters and
resolutions adopted by the Fund with respect to lost securities. The Auction
Agent may issue new certificates in exchange for and upon the cancellation of
mutilated certificates. Any request by the Fund to the Auction 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 Auction Agent that such
issuance will comply with such provisions of law and the By-Laws and resolutions
of the Fund.
4.5 Disposition of Cancelled Certificates; Record Retention. The
Auction Agent shall retain all share certificates which have been cancelled in
transfer or exchange and all accompanying documentation in accordance with
applicable rules and regulations of the Securities and Exchange Commission for
two calendar years. Upon the expiration of this two-year period, the Auction
Agent shall deliver to the Fund the cancelled certificates and accompanying
documentation. The Fund also shall undertake to furnish to the Securities and
Exchange Commission and to the Board of Governors of the Federal Reserve System,
upon demand, at either the 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 destroyed by the Fund without the concurrence of the
Auction Agent.
4.6 Share Transfer Books. For so long as the Auction Agent, Bankers
Trust Company, is acting as the transfer agent for any of the APS pursuant to
this Agreement, it shall maintain a share transfer book containing a list of the
Holders of the APS, the number of APS held by such Holders and the address of
each Holder. The Auction Agent shall record in such share transfer books any
change of address of a Holder upon notice by such Holder. In case of any request
or demand for the inspection of the share transfer books of the Fund or any
other books in the possession of the Auction Agent, the Auction Agent will
notify the Fund and secure instructions as to permitting or refusing such
inspection. The Auction Agent reserves the right, however, to exhibit the share
20
transfer books or other books 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 Auction Agent
hereunder by the Fund for any reason, including but not limited to redemption of
APS, that remain unpaid after ninety days shall be repaid to the Fund upon the
written request of the Fund, together with interest, if any, earned thereon.
5. Representations and Warranties of the Fund.
The Fund represents and warrants to the Auction Agent that:
(a) the Fund has been duly organized and is subsisting as a
voluntary association with transferable shares (commonly referred to as a
business trust) under the laws of The Commonwealth of Massachusetts and has all
necessary power and authority to execute and deliver this Agreement and to
authorize, create and issue the APS;
(b) this Agreement has been duly and validly authorized,
executed and delivered by the Fund and, assuming due authorization, execution
and delivery by the Auction Agent, constitutes the legal, valid and binding
obligation of the Fund subject, as to enforceability, to bankruptcy, insolvency,
reorganization, moratorium, receivership or similar laws, whether statutory or
decisional, relating to or affecting creditors' rights and to general equitable
principles (regardless of whether enforcement is sought in equity or at law);'
(c) the form of the certificate evidencing the APS complies
with all applicable laws of The Commonwealth of Massachusetts;
(d) the APS, when issued, delivered and paid for on the Date
of Original Issue as contemplated by the Underwriting Agreement, will have been
duly authorized, validly issued, fully paid and nonassessable, except as
provided under Massachusetts law;
(e) assuming the Underwriters comply with their obligations
under the Underwriting Agreement and that the purchasers of the APS comply with
their obliga-
21
tions in the Master Purchaser's Letter, no consent, authorization or order of,
or filing or registration with, any court, governmental agency or official
(except such as have been obtained and such as may be required under the
Securities Act of 1933, as amended, or the Investment Company Act of 1940, as
amended, or under the blue sky or state securities laws) is required in
connection with the execution and delivery of this Agreement or the issuance of
the APS; and
(f) the issuance and sale of the APS, the execution, delivery
and performance of this Agreement, compliance by the Fund with all provisions
hereof, and the consummation of the transactions contemplated hereby or by the
Underwriting Agreement or the Broker-Dealer Agreements, will not conflict with,
constitute a breach of any of the terms or provisions of, or a default under, or
result in the creation or imposition of any material lien, charge or encumbrance
upon any of the assets of the Fund pursuant to the terms of any agreement,
indenture or instrument to which the Fund is a party or by which the Fund is
bound, or result in a violation of the Declaration of Trust, APS Provisions or
By-Laws of the Fund or of any order, rule or regulation of any court or
governmental agency having jurisdiction over the Fund or its property which
conflict, breach, default, lien or violation, individually or in the aggregate,
would have a material adverse effect on the business, financial position or
results of operations of the Fund.
6. 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 other Person
by reason of this Agreement.
(b) The Auction Agent undertakes to perform such duties and
only such duties as are specifically set forth in this Agreement and the
Broker-Dealer Agreements, and no implied covenants or obligations shall be read
into this Agreement against the Auction Agent.
(c) In the absence of bad faith 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 except that the Auction
22
Agent shall be liable for any error of judgment made in good faith if the
Auction Agent shall have been grossly negligent in ascertaining the pertinent
facts.
(d) Any funds deposited with the Auction Agent hereunder by
the Fund for any reason, including the payment of dividends or the redemption of
APS, that remain with the Auction Agent after 90 days shall be repaid to the
Fund upon the written request of the Fund, together with interest, if any,
earned thereon.
6.2 Rights of the Auction Agent. (a) The Auction Agent may rely and
shall be protected in acting or refraining from acting upon any communication
authorized hereby and upon any written instruction, notice, request, direction,
consent, report, certificate, share certificate or other instrument, paper or
document believed by it to be genuine. The Auction Agent shall not be liable for
acting upon any telephone communication authorized hereby which the Auction
Agent believes in good faith to have been given by the Fund or by any
Broker-Dealer. The Auction Agent may record telephone communications with the
Fund or with any Broker-Dealer.
(b) The Auction Agent may consult with counsel reasonably
acceptable to the Fund 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 on the part of any agent or attorney
appointed by it with due care hereunder except as set forth above in Section
6.1(c).
6.3 Auction Agent's Disclaimer. The Auction Agent makes no
representation as to the validity or adequacy of this Agreement (except as to
the Auction Agent's duties hereunder and as to the due authorization, execution
and delivery of this Agreement), the Broker-Dealer
23
Agreements (except as to the Auction Agent's duties thereunder) or the APS.
6.4 Compensation, Expenses and Indemnification. (a) The Fund shall pay
the Auction Agent from time to time reasonable compensation for all services
rendered by it under this Agreement and the Broker-Dealer Agreements in such
amounts as may be agreed to by the Fund and the Auction Agent from time to time.
(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 the
Broker-Dealer Agreements (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any expense or disbursement
attributable to its gross negligence or bad faith.
(c) The Fund shall indemnify the Auction Agent for and hold it
harmless against, any loss, liability or expense incurred without gross
negligence or bad faith on its part, arising out of or in connection with its
agency under this Agreement and the Broker-Dealer Agreements, including the
costs and expenses of defending itself against any claim or liability in
connection with its exercise or performance of its duties hereunder and
thereunder for which indemnification is provided by this subsection.
7. 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 any time by so notifying the Auction Agent in writing,
provided that the Fund has entered into an agreement in substantially the form
of this Agreement with a successor auction agent. The Auction Agent may
terminate this Agreement upon written notice to the Fund, such termination to be
effective on the earlier of (i) the date specified in such notice which shall
not be earlier than 90 days after the giving of such notice or (ii) the date on
which a successor trust company is appointed by the Fund pursuant to an
agreement containing substantially the same terms and conditions as this
Agreement.
24
(b) Except as otherwise provided in this paragraph (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 obligations
under Section 6.4 hereof and its representations and warranties contained in
Section 5 hereof and the Auction Agent's obligations and liabilities under
Sections 2.10 and 4.5 hereof shall survive the termination hereof. Upon
termination of this Agreement, the Auction Agent shall, at the Fund's request,
promptly deliver to the Fund copies of all books and records maintained by it in
connection with its duties hereunder.
7.2 Communications. Except for (a) communications authorized to be by
telephone pursuant to this Agreement or the Auction Procedures and (b)
communications in connection with Auctions (other than those expressly required
to be in writing) and unless otherwise specified by the terms of this Agreement
all notices, requests and other communications to any party hereunder shall be
in writing (including telecopy or similar writing) given to such person at its
address or telecopy number set forth below:
If to the Company, Van Xxxxxx Xxxxxxx
addressed: Trust For Investment
Grade New York
Municipals
Xxx Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Attention: Treasurer
Telephone No.: (000) 000-0000
With a copy sent to:
Xxxxxx XxXxxxxxx
Xxx Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
If to the Auction Bankers Trust Company
Agent, addressed: Corporate Trust and Agency Group
Four Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
25
Attention: Auction Rate Securities
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
or to such other address as the party to whom the communication is addressed
shall have previously communicated to the other party. Communications shall be
given on behalf of the Fund by a Fund Officer and on behalf of the Auction Agent
by an Authorized Officer. Communications shall be effective when received at the
proper address.
7.3 Entire Agreement. This Agreement contains the entire agreement
among 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.
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, cancelled or waived, in whole or
in part, except by a written instrument signed by a duly authorized
representative of the party to be charged. The Fund shall notify the Auction
Agent and each Broker-Dealer of any change in the Fund's Declaration of Trust,
as amended and restated as of the date hereof, prior to the effective date of
any such change.
(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 rights or remedies with respect to any
subsequent breach.
7.6 Successors and Assigns. This Agreement shall be binding upon, inure
to the benefit of, and be enforceable by, the respective successors of each of
the Fund and the Auction Agent.
26
7.7 Limitation of Liability. Pursuant to the provisions of Article V,
Section 5.5 of the Fund's Declaration of Trust, as amended or restated as of the
date hereof, this Agreement is entered into by the trustees of the Fund not
individually, but as trustees under such Declaration of Trust and the
obligations of the Fund hereunder are not binding upon any such trustees or
shareholders of the Fund, individually, but bind only the trust estate.
7.8 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.
7.9 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.
7.10 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Auction Agency
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the date first above written.
VAN XXXXXX XXXXXXX
TRUST FOR INVESTMENT
GRADE NEW YORK
MUNICIPALS
By /s/ Xxxxxx X. XxXxxxxxx
----------------------------------
Name: Xxxxxx X. XxXxxxxxx
Title: President
BANKERS TRUST COMPANY
By /s/ Xxxxxx Xxxxxx
----------------------------------
Name: Xxxxxx Xxxxxx
Title: Assistant Treasurer
27
EXHIBIT A
FORM OF
BROKER-DEALER AGREEMENT
EXHIBIT B
FORM OF
MASTER PURCHASER'S LETTER
EXHIBIT C
SETTLEMENT PROCEDURES
EXHIBIT D
FORM OF APS PROVISIONS
EXHIBIT E
VAN XXXXXX XXXXXXX TRUST
FOR INVESTMENT GRADE NEW YORK MUNICIPALS
NOTICE OF AUCTION DATE FOR
AUCTION PREFERRED SHARES
("APS"
NOTICE IS HEREBY GIVEN that the Auction Date of the next
Auction for the APS of VAN XXXXXX XXXXXXX TRUST FOR INVESTMENT GRADE NEW YORK
MUNICIPALS (the "Fund") is scheduled to be __________ and the next Dividend
Payment Date for the Fund's APS will be _______.
[A Failure to Deposit in respect of the APS currently exists.
If such Failure to Deposit is not cured prior to 12:00 Noon on the fourth
Business Day prior to the next scheduled Auction Date of the APS as defined, the
next Auction will not be held. Notice of the next Auction for the APS will be
delivered when such Failure to Deposit is cured.(1)]
VAN XXXXXX XXXXXXX
TRUST FOR INVESTMENT
GRADE NEW YORK
MUNICIPALS
----------------------
Include this language if a Failure to Deposit exists
EXHIBIT F
VAN XXXXXX XXXXXXX TRUST
FOR INVESTMENT GRADE NEW YORK MUNICIPALS
NOTICE OF PROPOSED CHANGE OF
LENGTH OF RATE PERIOD OF
ACTION PREFERRED SHARES
("APS"
NOTICE IS HEREBY GIVEN that VAN XXXXXX XXXXXXX TRUST FOR
INVESTMENT GRADE NEW YORK MUNICIPALS (the "Fund") may exercise its option to
designate the Rate Period of its APS commencing [the first day of the proposed
Special Dividend Period] as a Special Dividend Period.
By 11:00 A.M. on the second Business Day next preceding the
first day of such proposed Special Dividend Period, the Fund will notify Bankers
Trust Company of either (a) its determination to exercise such option,
designating the length of such Special Dividend Period and the terms of the
Specific Redemption Provisions, if any, for such series or (b) its determination
not to exercise such option.
VAN XXXXXX XXXXXXX
TRUST FOR INVESTMENT
GRADE NEW YORK
MUNICIPALS
Dated:
EXHIBIT G
VAN XXXXXX XXXXXXX TRUST
FOR INVESTMENT GRADE NEW YORK MUNICIPALS
NOTICE OF CHANGE OF LENGTH OF RATE PERIOD OF
AUCTION PREFERRED SHARES
("APS"
NOTICE IS HEREBY GIVEN that VAN XXXXXX XXXXXXX TRUST FOR
INVESTMENT GRADE NEW YORK MUNICIPALS (the "Fund") has determined to designate
the Rate Period of its APS commencing on [the first day of the Special Dividend
Period] as a Special Dividend Period.
The Special Dividend Period will be [days] [year[s]].
The Auction Date for the Special Dividend Period is [the
Business Day next preceding the first day of such Special Dividend Period].
[Specific Redemption Provisions, if applicable.]
[As a result of the Special Dividend Period designation, the
amount of dividends payable on APS during the Special Dividend Period will be
based on a 360-day year] [include if Rate Period is greater than 28 Rate Period
Days].
The Special Dividend Period shall not commence if (a) on such
Auction Date Sufficient Clearing Bids shall not exist or (b) if a Failure to
Deposit shall have occurred prior to the first day thereof with respect to such
APS.
The scheduled Dividend Payment Dates for such APS during such
Special Dividend Period will be _______________________.
VAN XXXXXX XXXXXXX
TRUST FOR INVESTMENT
GRADE NEW YORK
MUNICIPALS
Dated:
EXHIBIT H
VAN XXXXXX XXXXXXX TRUST
FOR INVESTMENT GRADE NEW YORK MUNICIPALS
NOTICE OF DETERMINATION NOT TO CHANGE
LENGTH OF RATE PERIOD OF
AUCTION PREFERRED SHARES
("APS")
NOTICE IS HEREBY GIVEN that VAN XXXXXX XXXXXXX TRUST FOR
INVESTMENT GRADE NEW YORK MUNICIPALS (the "Fund") has determined not to exercise
its option to designate a Special Dividend Period of its APS and the next
succeeding Dividend Period of such APS will be a Minimum Rate Period of ___days.
VAN XXXXXX XXXXXXX
TRUST FOR INVESTMENT
GRADE NEW YORK
MUNICIPALS
Dated:
EXHIBIT I
VAN XXXXXX XXXXXXX TRUST
FOR INVESTMENT GRADE NEW YORK MUNICIPALS
NOTICE OF CURE OF
FAILURE TO DEPOSIT ON
AUCTION PREFERRED SHARES
("APS"
NOTICE IS HEREBY GIVEN that VAN XXXXXX XXXXXXX TRUST FOR
INVESTMENT GRADE NEW YORK MUNICIPALS (the "Fund") has cured its Failure to
Deposit with respect to its APS. The dividend rate on the APS for the current
Rate Period is ________ % per annum, the Dividend Payment Date[s] for current
Rate Period is scheduled to be ____________ and the next Auction Date is
scheduled to be
VAN XXXXXX XXXXXXX
TRUST FOR INVESTMENT
GRADE NEW YORK
MUNICIPALS
Dated:
EXHIBIT J
VAN XXXXXX XXXXXXX TRUST
FOR INVESTMENT GRADE NEW YORK MUNICIPALS
NOTICE OF SUBSEQUENT CURE OF
FAILURE TO DEPOSIT ON
AUCTION PREFERRED SHARES
("APS"
NOTICE IS HEREBY GIVEN that VAN XXXXXX XXXXXXX TRUST FOR
INVESTMENT GRADE NEW YORK MUNICIPALS (the "Fund") has cured its Failure to
Deposit with respect to its APS. The next Auction Date for the APS is scheduled
to be on ____________.
VAN XXXXXX XXXXXXX
TRUST FOR INVESTMENT
GRADE NEW YORK
MUNICIPALS
Dated:
EXHIBIT K
VAN XXXXXX XXXXXXX TRUST
FOR INVESTMENT GRADE NEW YORK MUNICIPALS
NOTICE OF
[CAPITAL GAINS] AND] [TAXABLE ORDINARY INCOME](1)
DIVIDEND FOR
AUCTION PREFERRED SHARES
("APS")
NOTICE IS HEREBY GIVEN that the amount of the dividend payable
on _____________for the APS of VAN XXXXXX XXXXXXX TRUST FOR INVESTMENT GRADE NEW
YORK MUNICIPALS (the "Fund") will be determined by the Auction to be held on
______________. Up to [$ A ](2) [$B] per share of the dividend payable on such
date as determined by such Auction will consist of [capital gains](2) [ordinary
income taxable for federal income tax purposes].(3) If the dividend amount
payable on such date as determined by
_____________________
(1) Include language with respect to capital gains, taxable ordinary income or
both depending on the character of the designation to be made with respect
to the dividend(s).
(2) Include bracketed material if a portion of the dividend will be designated
capital gains.
Include bracketed material if a portion of the dividend will be designated
ordinary income taxable for Federal income tax purposes and no portion of
the dividend will be designated capital gains.
such Auction is less than [$A](2) [$B](3) per share, the entire amount of the
dividend will consist of [capital gains](2) [ordinary income taxable for federal
income tax purposes](3). [To the extent such dividend amount exceeds [$A] per
share, any excess up to [$B] per share will consist of ordinary income taxable
for Federal income tax purposes].(4) Accordingly, the aforementioned composition
of the dividend payable on _________ should be considered in determining orders
to be submitted with respect to the Auction to be held on ____________. The
Applicable Percentage in effect for such Auction will be ______%.
VAN XXXXXX XXXXXXX
TRUST FOR INVESTMENT GRADE
NEW YORK MUNICIPALS
(4) Include bracketed material if a portion of the dividend will be designated
capital gains and a portion will be designated ordinary income taxable for
Federal income tax purposes.
A = the maximum amount of capital gains allocated to such series of APS
to be included in such dividend, divided by the number of shares of
APS.
B = the maximum amount of ordinary income taxable for Federal income
tax purposes allocated to such series of APS to be included in such
dividend, divided by the number of shares in such series.
