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BROKER-DEALER AGREEMENT
AMONG
THE BANK OF NEW YORK
AS AUCTION AGENT
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
[ ]
[ ]
[ ]
AS BROKER-DEALER
DATED AS OF [ ], 2001
RELATING TO
AUCTION MARKET PREFERRED SHARES OF
BLACKROCK MUNICIPAL 2018 TERM TRUST
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BROKER-DEALER AGREEMENT dated as of [ ], 2001 (this "Agreement"),
relating to Auction Market Preferred Shares of BlackRock Municipal 2018 Term
Trust (the "Trust") 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
Agent 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 Trust 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 "Shares of AMPS" or
"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, the Trust 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:
(a) "Agent Member" of any Person shall mean the member
of, or participant in, the Securities Depositary that will act on behalf of a
Bidder.
(b) "Agreement" with respect to the Trust shall mean
this Agreement as may be amended in writing with written consent of the Trust.
(c) "AMPS" shall mean the preferred shares, par value
$.001 per share, of the Trust designated as its "Auction Market Preferred
Shares" and bearing such further designation as to series as the Board of
Trustees, as the case may be, of the Trust or any committee thereof shall
specify.
(d) "Auction" shall have the meaning specified in
Section 2.1 hereof.
(e) "Auction" Procedures" shall mean the auction
procedures constituting Part II of the form of Statement as of the filing
thereof.
(f) "Authorized Officer" of the Auction Agent shall mean
each Vice President, Assistant Vice President and Assistant Treasurer of the
Auction Agent assigned to its Corporate Trust and Agency Group and every other
officer or employee of the Auction Agent designated as an "Authorized Officer"
for purposes hereof in a communication to the Trust.
(g) "Settlement Procedures" shall mean the Settlement
Procedures attached to the Auction Agent Agreement as Exhibit B.
(h) "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.
(i) "Trust 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 and each Assistant
Treasurer of the Trust and every other officer or employee of the Trust
designated as a "Trust Officer" for purposes hereof in a notice to the Auction
Agent.
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. Section 1 and 2 hereof shall be read in
conjunction with the Statement and in the event of any conflict with the
Statement, the Statement shall take precedence.
1.4 WARRANTIES OF BD. 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.
2. THE AUCTIONS
2.1 PURPOSE; INCORPORATION BY REFERENCE OF AUCTION PROCEDURES
AND SETTLEMENT PROCEDURES.
(a) On each Auction Date, the provisions of the Auction
Procedures will be followed by the Auction Agent for the purpose of determining
the Applicable Rate for the
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AMPS for the next Dividend 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 Trust's instruction, and BD hereby agrees, to perform such obligations and
procedures without further request by or instructions from the Trust.
(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 advise BD by telephone and shall confirm in writing, which
includes email or other electronic means, of the Maximum Rate, Reference Rate(s)
and Treasury Note Rate(s).
(b) BD shall cause the Maximum 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 (vii) of paragraph (a) 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 each
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 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.
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(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 Trust, 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.
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TIME EVENT
By 9:30 a.m. Auction Agent advises the Trust and the
Broker-Dealer of the applicable Maximum Rate and
the Reference Rate(s) and Treasury Note Rate(s) 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 2(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 3(a)
of the Auction Procedures.
By approximately 3:30 p.m. Auction Agent advises the Trust of results of
Auction as provided in Section 3(b) of 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
4 of the Auction Procedures. Auction Agent gives
notice of Auction results as set forth in paragraph
(a) 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 4 of the
Auction Procedures of the Trust, 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 Share of 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
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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 3:30 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 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.
(b) BD shall notify each Existing Holder or Potential
Holder on whose behalf BD has submitted an Order as set forth in paragraph (b)
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 Trust delivers to its Auction Agent a notice
of the Auction Date for any series of AMPS of the Trust for a Rate Period
thereof that next succeeds a Rate period that is not a Minimum Rate Period in
the form of Exhibit C to the Auction Agency Agreement, and BD is a
Broker-.Dealer of such series, the Auction Agent shall deliver such notice to BD
as promptly as practicable after its receipt of such notice from the Trust.
(b) If the Board of Trustees of the Trust proposes to
designate any succeeding Subsequent Rate Period of any series of AMPS of the
Trust as a Special Rate Period and the Trust delivers to its Auction Agent a
notice of such proposed Special Rate Period in the form of Exhibit D 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 Trust.
(c) If the Board of Trustees of the Trust determines to
designate such succeeding Subsequent Rate Period as a Special Rate Period, and
the Trust delivers to its
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Auction Agent a notice of such Special Rate Period in the form of Exhibit E to
the Auction Agency Agreement not later than 11:00 A.M. on the second Business
Day next preceding the first day of such 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.
(d) If the Trust 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 Rate Period stating that the Trust has determined not to
exercise its option to designate such succeeding Subsequent Rate Period as a
Special Rate Period, in the form of Exhibit F to the Auction Agency Agreement,
or shall fail to timely deliver either such notice or a notice in the form of
Exhibit E 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 ALLOCATION OF TAXABLE INCOME.
If the Trust delivers to its Auction Agent a notice in the form of
Exhibit I to the Auction Agency Agreement designating all or a portion of any
dividend on shares of any series of AMPS of the Trust to consist of net capital
gains or other income taxable for Federal income tax purposes, and BD is a
Broker-Dealer for such series, such Auction Agent shall deliver such notice to
BD on the Business Day following its receipt of such notice from the Trust. On
or prior to the Auction Date referred to in such notice, BD will contact each of
its customers that is a Beneficial Owner of shares of such series of AMPS or a
Potential Beneficial Owner of shares of such series of AMPS interested in
submitting an Order in the Auction to be held on such Auction Date, and BD will
notify such Beneficial Owners and Potential Beneficial Owners of the contents of
such notice. BD will be deemed to have notified such Beneficial Owners and
Potential Beneficial Owners if, for each of them, (i) BD makes a reasonable
effort to contact such Beneficial Owner or Potential Beneficial Owner by
telephone, and (ii) upon failing to contact such Beneficial Owner or Potential
Beneficial Owner by Telephone BD mails written notification to such Beneficial
Owner or Potential Beneficial Owner at the mailing address indicated in the
account records of BD.
The Auction Agent for any series of AMPS shall be required to
notify BD if it is a Broker-Dealer for such series within two Business Days
after each Auction of such series of the Auction Agent's receipt of notice from
the Trust that such Auction involves an allocation of income taxable for Federal
income tax purposes 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 shares of any series of AMPS of the Trust during any Rate Period
thereof (other than any Special Rate Period of Rate Period Days or any Rate
Period succeeding any Special Rate Period of more than 364 Rate Period 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 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 Section 2.8 of the Auction Agency Agreement
and the Trust shall have paid to the Auction Agent for such series the
applicable Late Charge as described in Section 2.8 of the
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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 G to the Auction
Agency Agreement by first-class mail, postage prepaid, to BD not later than one
Business Day after its receipt of the payment from the Trust 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 Trust during any Rate Period thereof (other than any
Special Rate Period of more than 364 Rate Period Days or any Rate Period
succeeding any Special Rate Period of more than 364 Rate Period 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 third 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 of the Auction Agency Agreement or the
Trust shall not have paid to the Auction Agent for such series the applicable
Late Charge described in Section 2.8 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 Trust during a Special Rate Period thereof of more than 364 Rate
Period Days, or during any Rate Period thereof succeeding any Special Rate
Period of more than 364 Rate Period 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 of the Auction Agency Agreement of the Trust
shall not have paid to the Auction Agent for such series the applicable Late
Charge described in Section 2.8 of the Auction Agency Agreement; then such
Auction Agent shall deliver a notice in the form of Exhibit H to the Auction
Agency Agreement to the Broker-Dealers for such series not later than one
Business Day after the receipt of the payment from the Trust curing such Failure
to Deposit and Late Charge.
2.8 SERVICE CHARGE TO BE PAID TO BD.
(a) No later than 12:00 noon on each Dividend Payment
Date, the Auction Agent after each Auction will pay a service charge from funds
provided by the Trust 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
Dividend Period, the product of (A) a fraction the numerator of which is the
number of days in such Dividend 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 365, 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 Dividend Period the amount determined by mutual consent of the Trust and
any such Broker-Dealers and 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, at the
commencement of the Dividend Period with respect to such Auction.
(b) If the Trust determines to change the rate at which
the Broker-Dealer Fee accrues, the Trust 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.
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2.9 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 in such Auction may deliver to such Person a number
of Shares of AMPS that is less than the number of Shares of AMPS that otherwise
were to be purchased by such Person. In such event, the number of Shares of AMPS
to be so delivered shall be determined by BD. Delivery of such lesser number of
Shares of AMPS shall constitute good delivery. Upon the occurrence of any such
failure to deliver Shares of AMPS, BD shall deliver to the Auction Agent the
notice required by Section 2.3(c)(ii) hereof. Notwithstanding the foregoing
provisions of this Section 2.9(a), 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 2.3(c)(ii) hereof. The Auction Agent shall have no duty or liability
with respect to enforcement of this Section 2.9(a).
(b) Neither the Auction Agent nor the Trust 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 agent for the
Trust hereunder and owes no duties, fiduciary or otherwise, to any other Person.
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(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
Agent Agreement, Auction Procedures or the Settlement Procedures against the
Auction Agent.
(c) In the absence of bad faith or negligence on its
part, the Auction Agent shall not be liable for any action taken, suffered, or
omitted 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
resulting from the use or reliance on a source of information used in good faith
and without negligence to make any determination, calculation or declaration
hereunder. The Auction Agent shall not be liable for any error of judgment made
in good faith unless the Auction Agent shall have been 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, Trust 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.
(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.
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 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 Trust or by BD. The
Auction Agent may record telephone communications with BD.
(b) The Auction Agent may consult with counsel of its
own choice, and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon.
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(c) The Auction Agent shall not be required to advance,
expend or risk its own funds or otherwise incur or become exposed to financial
liability in the performance of its duties hereunder.
(d) The Auction Agent may perform its duties and
exercise its rights hereunder either directly or by or through agents or
attorneys and shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed by it with due care.
(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.
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 Agent 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.
4. MISCELLANEOUS
4.1 TERMINATION. (a) 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 4.4 hereof. This Agreement
shall automatically terminate upon the redemption of all outstanding AMPS or
upon termination of the Auction Agent Agreement.
(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.
4.2 AGENT MEMBER. 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).
4.3 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:
11
If to BD, ______________________________
addressed: ______________________________
______________________________
______________________________
Attention: ___________________
Telephone No.: _______________
Facsimile No.: _______________
If to the Auction The Bank of New York
Agent, addressed: Corporate Trust Administration
0 Xxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Dealing and Trading Group - Auction Desk
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
If to the BD, Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
addressed: Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Equity Capital Markets
Telephone No.: 212-[ ]
Facsimile No.: 212- [ ]
or such other address or facsimile number as such party may hereafter specify
for such purpose by 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 Trust by an
Authorized Trust Officer. Telephone communications may be recorded.
4.4 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.
4.5 BENEFITS. Nothing in this Agreement, express or implied,
shall give to any person, other than the Auction Agent, the Trust and BD and
their respective successors and permitted assigns, any benefit of any legal or
equitable right, remedy or claim under this Agreement.
4.6 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.
12
(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.
4.7 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.
4.8 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.
4.9 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.
4.10 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING
EFFECT TO ANY PROVISIONS THEREOF RELATING TO CONFLICTS OF LAW, OTHER THAN
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF NEW YORK).
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the date first above written.
THE BANK OF NEW YORK
as Auction Agent
By:
----------------------------------
Xxxxxx Xxxxxxxxx
Vice President
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
as Broker-Dealer
By:
----------------------------------
Name:
Title:
14
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:
----------------------------------
Xxxxxx Xxxxxxxxx
Vice President
[ ]
as Broker-Dealer
By:
----------------------------------
Name:
Title:
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:
----------------------------------
Xxxxxx Xxxxxxxxx
Vice President
[ ]
as Broker-Dealer
By:
----------------------------------
Name:
Title:
Exhibit A
To BROKER-DEALER
AGREEMENT
AUCTION BID FORM
(Submit only one Order on this Order Form)
BLACKROCK MUNICIPAL 2018 TERM TRUST
Auction Market Preferred Shares ("AMPS")
To: The Bank of New York
Corporate Trust Administration Date of Auction ______________
0 Xxxx Xxxxx, 00xx Xxxxx Series of AMPS (indicate by
Xxx Xxxx, Xxx Xxxx 00000 Number Designation)
Attention: Dealing and Trading Group _______
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 Shares 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 Shares 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 Shares 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 Shares of AMPS not greater than the number of Shares 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 Shares of AMPS with an aggregate
liquidation preference of $25,000.
Name of Broker-Dealer: _______________________
By: __________________________________________
A-1
Exhibit B
To BROKER-DEALER
AGREEMENT
(To be used only for transfers made other than
pursuant to an Auction)
TRANSFER FORM
BLACKROCK MUNICIPAL 2018 TERM TRUST
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 ___
Shares of AMPS to ____________________.
BLACKROCK MUNICIPAL 2018 TERM TRUST
_______________________________________ ________________________________________
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
BLACKROCK MUNICIPAL 2018 TERM TRUST
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 ____ Shares of AMPS in the Auction held on
__________________ from the seller of such AMPS.
II. We are a Broker-Dealer for _____________ (the "Seller"), which
sold ____ Shares of 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
