EXHIBIT (k)(4)
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BOOK-ENTRY-ONLY AUCTION-RATE/MONEY MARKET PREFERRED/AND
REMARKETED PREFERRED SECURITIES
________________________________________________________________________________
Letter of Representations
[To be Completed by Issuer and Trust Company]
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[Name of Issuer]
----------------------------
[Name of Trust Company]
Attention: General Counsel's Office __________
THE DEPOSITORY TRUST COMPANY (Date)
00 Xxxxx Xxxxxx; 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Re:____
______________________________________________________________________
______________________________________________________________________
(Issue Description, including CUSIP number)
Ladies and Gentlemen:
This letter sets forth our understanding with respect to certain
matters relating to the above-referenced issue (the "Securities"). Trust
Company will act as transfer agent, registrar, dividend disbursing agent, and
redemption agent with respect to the Securities. The Securities will be issued
pursuant to a prospectus, private placement memorandum, or other such document
authorizing the issuance of the Securities dated _________, 199___ (the
Document").
___________
("Underwriter")
is distributing the Securities through The Depository Trust Company ("DTC").
To induce DTC to accept the Securities as eligible for deposit at DTC, and
to act in accordance with its Rules with respect to the Securities, Issuer and
Trust Company make the following representations to DTC:
1. Prior to closing on the Securities on ____________ 199___, there shall
be deposited with DTC one Security certificate registered in the name of DTC's
nominee, Cede & Co., which represents the total number of Securities issued.
Said certificate shall remain in DTC's custody as provided in the Document. If,
however, the aggregate principal amount of the Securities exceeds $150 million,
one certificate will be issued with respect to each $150 million of principal
amount and an additional certificate will be issued with respect to any
remaining principal amount. Each $150 million Securities certificate shall bear
the following legend:
Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to
Issuer or its agent for registration of transfer, exchange, or
payment, and any certificate issued is registered in the name of Cede
& Co. or in such other name as is requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
2. In the event of any solicitation of consents from or voting by holders
of the Securities, Issuer shall establish a record date for such purposes (with
no provision for revocation of consents or votes by subsequent holders) and
shall, to the extent possible, send notice of such record date to DTC not less
than 15 calendar days in advance of such record date. Notices to DTC pursuant
to this Paragraph by telecopy shall be sent to DTC's Reorganization Department
at (000) 000-0000 or (000) 000-0000, and receipt of such notices shall be
confirmed by telephoning (000) 000-0000. Notices to DTC pursuant to this
Paragraph by mail or by any other means shall be sent to DTC's Reorganization
Department as indicated in Paragraph 4.
3. In the event of a full or partial redemption of the outstanding
Securities, Issuer or Trust Company shall send a notice to DTC specifying: (a)
the number of Securities to be redeemed; and (b) the date such notice is to be
mailed to Security holders or published (the "Publication Date"). Such notice
shall be sent to DTC by a secure means (e.g., legible telecopy, registered or
certified mail, overnight delivery) in a timely manner designed to assure that
such notice is in DTC's possession no later than the close of business on the
business day before or, if possible, two business days before the Publication
Date. Issuer or Trust Company shall forward such notice either in a separate
secure transmission for each CUSIP number or in a secure transmission for
multiple CUSIP numbers (if applicable) which includes a manifest or list of each
CUSIP number submitted in that transmission. (The party sending such notice
shall have a method to verify subsequently the use of such means and the
timeliness of such notice. The Publication Date shall be not less than 30 days
nor more than 60 days prior to the redemption date. Notices to DTC pursuant to
this Paragraph by telecopy shall be sent to DTC's Call Notification Department
at (000) 000-0000 or (000) 000-0000. If the party sending the notice does not
receive a telecopy receipt from DTC confirming that the notice has been
received, such
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party shall telephone (000) 000-0000. Notices to DTC pursuant to this Paragraph
by mail or by any other means shall be sent to:
Manager; Call Notification Department
The Depository Trust Company
000 Xxxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000-0000
4. In the event of an invitation to tender the Securities, notice by
Issuer or Trust Company to Security holders specifying the terms of the tender
and the Publication Date of such notice shall be sent to DTC by a secure means
in the manner set forth in the preceding Paragraph. Notices to DTC pursuant to
this Paragraph and notices of other corporate actions (including mandatory
tenders, exchanges, and capital changes) by telecopy shall be sent to DTC's
Reorganization Department at (000) 000-0000 or (000) 000-0000, and receipt of
such notices shall be confirmed by telephoning (000) 000-0000. Notices to DTC
pursuant to the above by mail or by any other means shall be sent to:
Manager; Reorganization Department
Reorganization Window
The Depository Trust Company
0 Xxxxxxx Xxxxxx; 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
5. All notices and payment advices sent to DTC shall contain the CUSIP
number of the Securities.
6. The Document indicates that the dividend rate for the Securities may
vary from time to time. Absent other existing arrangements with DTC, Issuer or
Trust Company shall give DTC notice of each such change in the dividend rate, on
the same day that the new rate is determined, by telephoning the Supervisor of
DTC's Dividend Announcement Section at (000) 000-0000, or by telecopy sent to
(000) 000-0000. Such verbal or telecopy notice shall be followed by prompt
written confirmation sent by a secure means in the manner set forth in Paragraph
3 to:
Manager; Announcements
Dividend Department
The Depository Trust Company
0 Xxxxxxx Xxxxxx; 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
7. The Document indicates that each purchaser of Securities must sign a
purchaser's letter which contains provisions restricting transfer of the
Securities purchased. Issuer and Trust Company acknowledge that as long as Cede
& Co. is the sole record owner of the Securities, Cede & Co. shall be entitled
to all voting rights applicable to the Securities and to receive the full amount
of all dividends, liquidation proceeds, and redemption proceeds payable with
respect to the Securities, even if the credits of Securities to the DTC accounts
of any DTC Participant ("Participant") result from transfers or failures to
transfer in violation of the provisions of the purchaser's letter. Issuer and
Trust Company acknowledge that DTC shall treat any Participant
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having Securities credited to its DTC accounts as entitled to the full benefits
of ownership of such Securities. Without limiting the generality of the
preceding sentence, Issuer and Trust Company acknowledge that DTC shall treat
any Participant having Securities credited to its DTC accounts as entitled to
receive dividends, distributions, and voting rights, if any, in respect of
Securities and, subject to Paragraphs 11 and 12, to receive certificates
evidencing Securities if such certificates are to be issued in accordance with
Issuer's certificate of incorporation. (The treatment by DTC of the effects of
the crediting by it of Securities to the accounts of Participants described in
the preceding two sentences shall not affect the rights of Issuer, participants
in auctions relating to the Securities, purchasers, sellers, or holders of
Securities against any Participant.) DTC shall not have any responsibility to
ascertain whether any transfer of Securities is made in accordance with the
provisions of the purchaser's letter.
8. Transactions in the Securities shall be eligible for same-day funds
settlement in DTC's Same-Day Funds Settlement ("SDFS") system.
A. Dividend payments shall be received by Cede & Co., as nominee of
DTC, or its registered assigns in same-day funds on each payment date
(or the equivalent in accordance with existing arrangements between
Issuer or Trust Company and DTC). Such payments shall be made payable
to the order of Cede & Co. Absent any other existing arrangements,
such payments shall be addressed as follows:
Manager; Cash Receipts
Dividend Department
The Depository Trust Company
0 Xxxxxxx Xxxxxx; 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
B. Redemption payments shall be made in same-day funds by Trust
Company in the manner set forth in the SDFS Paying Agent Operating
Procedures, a copy of which previously has been furnished to Trust
Company.
9. DTC may direct Issuer or Trust Company to use any other number or
address as the number or address to which notices, payments of dividends, or
redemption proceeds may be sent.
10. In the event of a redemption necessitating a reduction in the number
of Securities outstanding, DTC, in its discretion: (a) may request Issuer or
Trust Company to issue and authenticate a new Security certificate; or (b) may
make an appropriate notation on the Security certificate indicating the date and
amount of such reduction in the number of Securities outstanding, except in the
case of final redemption, in which case the certificate will be presented to
Issuer or Trust Company prior to payment, if required.
11. In the event that Issuer determines that beneficial owners of
Securities shall be able to obtain certificated Securities, Issuer or Trust
Company shall notify DTC of the availability of certificates. In such event,
Issuer or Trust Company shall issue, transfer, and exchange certificates in
appropriate amounts, as required by DTC and others.
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12. DTC may discontinue providing its services as securities depository
with respect to the Securities at any time by giving reasonable notice to Issuer
or Trust Company (at which time DTC will confirm with Issuer or Trust Company
the aggregate principal amount of Securities outstanding). Under such
circumstances, at DTC's request Issuer and Trust Company shall cooperate fully
with DTC by taking appropriate action to make available one or more separate
certificates evidencing Securities to any DTC Participant having Securities
credited to its DTC accounts.
13. Issuer hereby authorizes DTC to provide to Trust Company security
position listings of Participants with respect to the Securities from time to
time at the request of Trust Company. Issuer also authorizes DTC, in the event
of a partial redemption of Securities, to provide Trust Company, upon request,
with the names of those Participants whose positions in Securities have been
selected for redemption by DTC. DTC will use its best efforts to notify Trust
Company of those Participants whose positions in Securities have been selected
for redemption by DTC. Issuer authorizes and instructs Trust Company to provide
DTC with such signatures, examples of signatures, and authorizations to act as
may be deemed necessary or appropriate by DTC to permit DTC to discharge its
obligations to its Participants and appropriate regulatory authorities. Such
requests for security position listings shall be sent to DTC's Reorganization
Department in the manner set forth in Paragraph 4.
This authorization, unless revoked by Issuer, shall continue with respect
to the Securities while any Securities are on deposit at DTC, until and unless
Trust Company shall no longer be acting. In such event, Issuer shall provide
DTC with similar evidence, satisfactory to DTC, of the authorization of any
successor thereto so to act.
14. Issuer: (a) understands that DTC has no obligation to, and will not,
communicate to its Participants or to any person having an interest in the
Securities any information contained in the Security certificate(s); and (b)
acknowledges that neither DTC's Participants nor any person having an interest
in the Securities shall be deemed to have notice of the provisions of the
Security certificate(s) by virtue of submission of such certificate(s) to DTC.
15. Nothing herein shall be deemed to require Trust Company to advance
funds on behalf of Issuer.
Notes: Very truly yours,
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A. If there is a Trust Company (as defined (Issuer)
in this Letter of Representations), Trust
Company as well as Issuer must sign this
Letter. If there is no Trust Company, in By:_______________________________
signing this Letter Issuer itself (Authorized Officer's Signature)
undertakes to perform all of the
obligations set forth herein. (Trust Company)
X. Xxxxxxxx A contains statements that DTC
believes accurately describe DTC, the (Authorized Officer's
method of effecting book-entry transfers of Signature)
securities distributed through DTC, and
certain related matters.
Received and Accepted:
THE DEPOSITORY TRUST COMPANY
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SCHEDULE A
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SAMPLE OFFERING DOCUMENT LANGUAGE
DESCRIBING BOOK-ENTRY-ONLY ISSUANCE
-----------------------------------
(Prepared by DTC-bracketed material may be applicable only to certain issues)
1. The Depository Trust Company ("DTC"), New York, NY, will act as
securities depository for the securities (the "Securities"). The Securities
will be issued as fully-registered securities registered in the name of Cede &
Co. (DTC's partnership nominee). One fully-registered Security certificate will
be issued for [each issue of] the Securities, [each] in the aggregate principal
amount of such issue, and will be deposited with DTC. [If, however, the
aggregate principal amount of [any] issue exceeds $150 million, one certificate
will be issued, with respect to each $150 million of principal amount and an
additional certificate will be issued with respect to any remaining principal
amount of such issue.]
2. DTC is a limited-purpose trust company organized under the New York
Banking Law, a "banking organization" within the meaning of the New York Banking
Law, a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934. DTC holds securities that its participants ("Participants")
deposit with DTC. DTC also facilitates the settlement among Participants of
securities transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes in Participants' accounts,
thereby eliminating the need for physical movement of securities certificates.
Direct Participants include securities brokers and dealers, banks, trust
companies, clearing corporations, and certain other organizations. DTC is owned
by a number of its Direct Participants and by the New York Stock Exchange, Inc.,
the American Stock Exchange, Inc., and the National Association of Securities
Dealers, Inc. Access to the DTC system is also available to others such as
securities brokers and dealers, banks, and trust companies that clear through or
maintain a custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants"). The Rules applicable to DTC and its
Participants are on file with the Securities and Exchange Commission.
3. Purchases of Securities under the DTC system must be made by or through
Direct Participants, which will receive a credit for the Securities on DTC's
records. The ownership interest of each actual purchaser of each Security
("Beneficial Owner") is in turn to be recorded on the Direct and Indirect
Participants' records. Beneficial Owners will not receive written confirmation
from DTC of their purchase, but Beneficial Owners are expected to receive
written confirmations providing details of the transaction, as well as periodic
statements of their holdings, from the Direct or Indirect Participant through
which the Beneficial Owner entered into the transaction. Transfers of ownership
interests in the Securities are to be accomplished by entries made on the books
of Participants acting on behalf of Beneficial Owners. Beneficial Owners will
not receive certificates representing their ownership, interests in Securities,
except in the event that use of the book-entry system for the Securities is
discontinued.
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4. To facilitate subsequent transfers, all Securities deposited by
Participants with DTC are registered in the name of DTC's partnership nominee,
Cede & Co. The deposit of Securities with DTC and their registration in the
name of Cede & Co. effect no change in beneficial ownership. DTC has no
knowledge of the actual Beneficial Owners of the Securities; DTC's records
reflect only the identity of the Direct Participants to whose accounts such
Securities are credited, which may or may not be the Beneficial Owners. The
Participants will remain responsible for keeping account of their holdings on
behalf of their customers.
5. Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
[6. Redemption notices shall be sent to Cede & Co. If less than all of
the Securities within an issue are being redeemed, DTC's practice is to
determine by lot the amount of the interest of each Direct Participant in such
issue to be redeemed.]
7. Neither DTC nor Cede & Co. will consent or vote with respect to
Securities. Under its usual procedures, DTC mails an Omnibus Proxy to the
Issuer as soon as possible after the record date. The Omnibus Proxy assigns
Cede & Co.'s consenting or voting rights to those Direct Participants to whose
accounts the Securities are credited on the record date (identified in a listing
attached to the Omnibus Proxy).
8. Principal and interest payments on the Securities will be made to DTC.
DTC's practice is to credit Direct Participants' accounts on payable date in
accordance with their respective holdings shown on DTC's records unless DTC has
reason to believe that it will not receive payment on payable date. Payments by
Participants to Beneficial Owners will be governed by standing instructions and
customary practices, as is the case with securities held for the accounts of
customers in bearer form or registered in "street name," and will be the
responsibility of such Participant and not of DTC, the Agent, or the Issuer,
subject to any statutory or regulatory requirements as may be in effect from
time to time. Payment of principal and interest to DTC is the responsibility of
the Issuer or the Agent, disbursement of such payments to Direct Participants
shall be the responsibility of DTC, and disbursement of such payments to the
Beneficial Owners shall be the responsibility of Direct and Indirect
Participants.
[9. A Beneficial Owner shall give notice to elect to have its Securities
purchased or tendered, through its Participant, to the [Tender/Remarketing]
Agent, and shall effect delivery of such Securities by causing the Direct
Participant to transfer the Participant's interest in the Securities, on DTC's
records, to the [Tender/Remarketing] Agent. The requirement for physical
delivery of Securities in connection with a demand for purchase or a mandatory
purchase will be deemed satisfied when the ownership rights in the Securities
are transferred by Direct Participants on DTC's records.]
10. DTC may discontinue providing its services as securities depository
with respect to the Securities at any time by giving reasonable notice to the
Issuer or the Agent. Under such
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circumstances, in the event that a successor securities depository is not
obtained, Security certificates are required to be printed and delivered.
11. The Issuer may decide to discontinue use of the system of book-entry
transfers through DTC (or a successor securities depository). In that event,
Security certificates will be printed and delivered.
12. The information in this section concerning DTC and DTC's book-entry
system has been obtained from sources that the Issuer believes to be reliable,
but the Issuer takes no responsibility for the accuracy thereof.
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RIDER TO THE LETTER OF REPRESENTATIONS
of
MUNIHOLDINGS CALIFORNIA INSURED FUND III, INC.
AND
IBJ XXXXXXXX BANK & TRUST COMPANY
Dated , 1998
This Rider supersedes any contradictory language set forth in the
Letter of Representations to which it is appended. Capitalized terms
used and not defined herein have the meaning set forth in the Letter
of Representations to which this Rider is appended.
The Prospectus indicates that in the event the Issuer retroactively
allocates any net capital gains or other income subject to regular
Federal income tax to shares of AMPS without having given advance
notice thereof to the Auction Agent as described in the Prospectus
solely by reason of the fact that such allocation is made as a result
of the redemption of all or a portion of the shares of AMPS
outstanding or the liquidation of the Issuer (the amount of such
allocation being referred to herein as a "Retroactive Taxable
Allocation"), the Issuer, within 90 days (and generally within 60
days) after the end of the Issuer's fiscal year for which a
Retroactive Taxable Allocation is made, will provide notice thereof to
the Auction Agent and to each holder of shares of AMPS (initially Cede
& Co. as nominee of DTC) during such fiscal year at such holder's
address as the same appears or last appeared on the stock books of the
Issuer. The Issuer, within 30 days after such notice is given to the
Auction Agent, will pay to the Auction Agent (who then will distribute
to such holders of AMPS), out of funds legally available therefor, an
amount equal to the aggregate Additional Dividend with respect to all
Retroactive Taxable Allocations made to such holders during the fiscal
year in question.
The Issuer will notify DTC, at least 10 Business Days prior to the
payment date for any Additional Dividends, of (i) the record date for
holders of shares of AMPS entitled to receive Additional Dividends,
(ii) the amount of Additional Dividends payable on a per share basis
to such holders and (iii) the CUSIP numbers set forth on the stock
certificates representing such shares of AMPS.
The Prospectus indicates that if the Issuer does not give advance
notice of the amount of net capital gains or other income subject to
regular Federal income tax to be included in a dividend on shares of
AMPS in the related Auction, the Issuer may include such taxable
income in a dividend on shares of AMPS if it increases the dividend by
an additional amount calculated as if such income were a Retroactive
Taxable Allocation and the additional amount were an Additional
Dividend. The Issuer or the Auction Agent will notify DTC, at least
five Business
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Days prior to the applicable Dividend Payment Date, of the amount of
such additional amount to be included in the dividend on a per share
basis.
The Prospectus indicates that in the event a Response (as defined in
the Prospectus) indicates that it is advisable that the Issuer give a
Notice of Special Dividend Period (as defined in the Prospectus) for
the AMPS, the Issuer, by no later than the second Business Day prior
to the relevant Auction Date (as defined in the Prospectus), may give
a Notice of Special Dividend Period to the Auction Agent, DTC and each
Broker-Dealer (as defined in the Prospectus), which notice will
specify (i) the duration of the Special Dividend Period (as defined in
the Prospectus), (ii) the Optional Redemption Price as specified in
the related Response and (iii) the Specific Redemption Provisions, if
any, as specified in the related Response. The Issuer is required to
give telephonic and written notice (a "Notice of Revocation") to the
Auction Agent, each Broker-Dealer, and DTC (as described in paragraph
6 hereof) on or prior to the Business Day prior to the relevant
Auction Date under the circumstances specified in the Prospectus.
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