SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
240.14a-11(c) or 240.14a-12
WESTERN ASSET/CLAYMORE INFLATION-LINKED
SECURITIES & INCOME FUND
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction
applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was previously paid. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
WESTERN ASSET/CLAYMORE INFLATION-LINKED
SECURITIES & INCOME FUND
(NYSE -- WIA)
385 EAST COLORADO BOULEVARD
PASADENA, CALIFORNIA 91101
--------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 25, 2010
--------------------------------------------------------------------------------
To the Shareholders of
WESTERN ASSET/CLAYMORE INFLATION-LINKED
SECURITIES & INCOME FUND
The Annual Meeting of Shareholders of Western Asset/Claymore
Inflation-Linked Securities & Income Fund (the "Fund") will be held at the
offices of Claymore Securities, Inc., 2455 Corporate West Drive, Lisle,
Illinois 60532, on Tuesday, May 25, 2010 at 2:30 p.m., Central time, for the
following purposes:
(1) Electing one Class I Trustee, to hold office for the term indicated;
and
(2) Transacting such other business as may properly come before the Annual
Meeting and any adjournment(s) thereof.
The Board of Trustees has fixed the close of business on March 26, 2010 as the
record date for the determination of shareholders entitled to receive notice of
and to vote at the Annual Meeting and any adjournment(s) or postponement(s)
thereof. The enclosed proxy is being solicited on behalf of the Board of
Trustees of the Fund.
By Order of the Board of Trustees
/s/ Melissa J. Nguyen, Secretary
Pasadena, California
April 14, 2010
SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON ARE
URGED TO DATE, FILL IN, SIGN AND MAIL THE ENCLOSED PROXY IN THE ACCOMPANYING
ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
WESTERN ASSET/CLAYMORE INFLATION-LINKED
SECURITIES & INCOME FUND
385 East Colorado Boulevard
Pasadena, California 91101
PROXY STATEMENT
The accompanying proxy is solicited by the Board of Trustees of the
Fund for use at the annual meeting of shareholders of the Fund, to be held on
May 25, 2010 at 2:30 p.m., Central time (the "Annual Meeting"), and at any
adjournment(s) or postponement(s) thereof. At the Annual Meeting, shareholders
will be asked to consider the re-election of Michael Larson to the Board of
Trustees of the Fund. This Proxy Statement and the accompanying form of proxy
were first mailed to shareholders on or about April 16, 2010.
The Board of Trustees has fixed the close of business on March 26,
2010 as the record date for the determination of shareholders entitled to
notice of and to vote at the Annual Meeting and any adjournment(s) thereof. As
of the close of business on that date, the Fund had issued and outstanding
29,152,820 common shares of beneficial interest, no par value (the "Shares").
The Shares constitute the only outstanding voting securities of the Fund
entitled to be voted at the Annual Meeting.
Shareholders of the Fund as of the close of business on March 26,
2010 will be entitled to one vote for each Share held, and a fractional vote
with respect to fractional Shares, with no cumulative voting rights. Thirty
percent of the total Shares of the Fund entitled to vote at the Annual Meeting
must be represented in person or by proxy to constitute a quorum for the Annual
Meeting. Each shareholder has the right to revoke his or her proxy at any time
before it is voted. A proxy, including a proxy given by telephone, may be
revoked by filing with the Secretary of the Fund a written revocation or a
properly executed proxy bearing a later date (including a proxy given by
telephone) or by voting in person at the Annual Meeting. Any shareholder may
attend the Annual Meeting, whether or not he or she has previously given a
proxy.
The solicitation of proxies for the Annual Meeting will be made
primarily by mail. However, if necessary to ensure satisfactory representation
at the Annual Meeting, additional solicitation may take place in writing or by
telephone or personal interview by officers of the Fund (or their designees),
who will not receive compensation from the Fund for such services. The Fund
will reimburse brokers and other nominees, in accordance with New York Stock
Exchange approved reimbursement rates, for their expenses in forwarding
solicitation material to the beneficial owners of shares of the Fund. All
expenses incurred in connection with the solicitation of proxies by the Board
of Trustees will be borne by the Fund.
Abstentions and "broker non-votes" (i.e., proxies signed and returned
by brokers with respect to shares held by brokers or nominees as to which one
or
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more votes is not indicated because (i) instructions have not been received
from the beneficial owners or the persons entitled to vote and (ii) the broker
or nominee does not have discretionary voting power on a particular matter)
will be counted as shares present for purposes of determining whether a quorum
is present, but will not be counted as having been voted on the matter in
question. Assuming that a quorum would otherwise be present, abstentions and
broker non-votes will accordingly have no effect for the purpose of determining
whether a Trustee has been elected.
R. Jay Gerken, Kevin M. Robinson and Melissa J. Nguyen, the persons
named as proxies on the proxy card accompanying this Proxy Statement, were
selected by the Board of Trustees to serve in such capacity. Mr. Gerken and Ms.
Nguyen are each officers of the Fund, and Mr. Gerken is also a Trustee of the
Fund. Each executed and returned proxy will be voted in accordance with the
directions indicated thereon or, if no direction is indicated, such proxy will
be voted for the election as a Trustee of the Fund, the nominee listed in this
Proxy Statement. Discretionary authority is provided in the proxy as to any
matters not specifically referred to therein. The Board of Trustees is not
aware of any other matters which are likely to be brought before the Annual
Meeting. However, if any such matters properly come before the Annual Meeting,
the persons named in the proxy are fully authorized to vote thereon in
accordance with their judgment and discretion. Except when a different vote is
required by any provision of law or the Fund's Amended and Restated Agreement
and Declaration of Trust (the "Declaration of Trust") or Bylaws, a plurality of
the quorum of Shares necessary for the transaction of business at the Annual
Meeting will decide any questions and a plurality of Shares voted shall elect a
Trustee.
HOW TO SUBMIT A PROXY
Shareholders of record may submit a proxy in respect of their shares
by using any of the following methods:
By Telephone. Submit a proxy by calling the toll-free telephone
number printed on the proxy card. The proxy card should be in hand when making
the call. Easy-to-follow voice prompts allow the shareholder of record to
authenticate his or her identity by entering the validation numbers printed on
the enclosed proxy card, provide voting instructions for the shares, and
confirm that the instructions have been properly recorded.
Please see the instructions on the enclosed card for telephone
touch-tone proxy submission. Shareholders will have an opportunity to review
their voting instructions and to make any necessary changes before submitting
their voting instructions and terminating their telephone call.
By Mail. Shareholders of record may complete, sign, and date the
proxy card and return it in the prepaid envelope provided.
3
PROPOSAL
ELECTION OF CLASS I TRUSTEE
In accordance with the Declaration of Trust, the Trustees were
divided into the following three classes (each a "Class") prior to the initial
public offering of the Shares: Class I, whose term will expire at the Annual
Meeting; Class II, whose term will expire at the Fund's 2011 annual meeting of
shareholders; and Class III, whose term will expire at the Fund's 2012 annual
meeting of shareholders. At each annual meeting, successors to the Class of
Trustees whose term expires at that annual meeting will be elected for a
three-year term.
-----------------------------------------------------------
NOMINEE CLASS EXPIRATION OF TERM IF ELECTED*
-----------------------------------------------------------
MICHAEL LARSON CLASS I 2013 ANNUAL MEETING
-----------------------------------------------------------
* Each Trustee holds office until the annual meeting for the year in which
his or her term expires and until his or her successor shall be elected and
shall qualify, subject, however, to prior death, resignation, retirement,
disqualification or removal from office.
Under the Fund's classified Board structure, ordinarily only the
Trustee(s) in a single Class may be replaced in any one year, and it would
require a minimum of two years to change a majority of the Board of the Fund
under normal circumstances. This structure, which may be regarded as an
"anti-takeover" measure, may make it more difficult for the Fund's shareholders
to change the majority of Trustees of the Fund and, thus, promotes the
continuity of management.
It is the intention of the persons designated as proxies in the proxy
card, unless otherwise directed therein, to vote at the Annual Meeting for the
re-election of Mr. Larson. Mr. Larson has agreed to continue to serve if
elected at the Annual Meeting. If Mr. Larson is unable or unavailable to serve,
the persons named in the proxies will vote the proxies for such other person as
the Board of Trustees may recommend.
Information Regarding the Trustees. Information about the Trustees
and the nominee, including their ages as of February 1, 2010, is set forth
below. The address of each Trustee and the nominee is c/o the Fund at its
principal business address (385 East Colorado Boulevard, Pasadena, California
91101). Of the individuals listed below, Mr. Larson is the only nominee for
election at the Annual Meeting.
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NUMBER OF
PORTFOLIOS SHARES OF
TERM OF IN FUND OTHER THE FUND
POSITION(S) OFFICE AND PRINCIPAL COMPLEX* DIRECTORSHIPS BENEFICIALLY
HELD LENGTH OCCUPATIONS OVERSEEN BY HELD BY OWNED ON
WITH OF TIME DURING THE TRUSTEE OR TRUSTEE OR FEBRUARY 1,
NAME AND AGE FUND SERVED PAST 5 YEARS NOMINEE NOMINEE* 2010
------------------------------------------------------------------------------------------------------------------------
Independent Trustees
Michael Larson Nominee, Term Chief Investment 2 Pan American 4,534**
50 Trustee and expires at Officer for William H. Silver Corp.
Chairman of the Annual Gates III (1994--present). (1999--present);
the Board of Meeting; Republic Services,
Trustees(1)(2) served since Inc. (2009-present);
May 2004 Grupo Televisa,
S.A.B. (2009-present).
Ronald A. Trustee(1)(2) Term Partner of Nyberg & 47 None 707***
Nyberg expires in Cassioppi, LLC, a law
56 2011; firm specializing in Corporate
served since Law, Estate Planning and
August 2003 Business Transactions
(2000-present). Formerly,
Executive Vice President,
General Counsel, and
Corporate Secretary of
Van Kampen Investments
(1982-1999).
Ronald E. Trustee(1)(2) Term Retired. Formerly Vice 44 None None
Toupin, Jr. expires in President, Manager and
51 2012; Portfolio Manager of Nuveen
served since Asset Management (1998-
August 2003 1999), Vice President of
Nuveen Investment Advisory
Corporation (1993-1999),
Vice President and Manager
of Nuveen Unit Investment
Trusts (1991-1999), and
Assistant Vice President and
Portfolio Manager of Nuveen
Unit Investment Trusts
(1988-1999), each of John
Nuveen & Company, Inc.
(1982-1999).
Interested Trustee
R. Jay Gerken Trustee Term Managing Director of Legg 147 None 2,167
58(3) and President expires in Mason & Co., Chairman,
2012; President and Chief
served since Executive Officer of
March 2007 certain mutual funds
associated with Legg
Mason & Co., LLC ("Legg
Mason & Co.") or its
affiliates (2005-present);
President of Legg Mason
Partners Fund Advisor,
LLC ("LMPFA") (2006-
present); Chairman of
Smith Barney Fund
Management LLC and
Citi Fund Management Inc.
(2002-2005); Chairman,
President and Chief Executive
Officer of Travelers Investment
Adviser, Inc. (2002-2005).
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(1) Member of the Audit Committee of the Board of Trustees.
(2) Member of the Governance and Nominating Committee of the Board of Trustees.
(3) Mr. Gerken is an "interested person" (as defined above) of the Fund because
of his position as President of the Fund, and his positions with
subsidiaries of, and ownership of shares of common stock of, Legg Mason,
Inc., the parent company of the Fund's investment managers, Western Asset
Management Company ("Western Asset or the "Manager"), Western Asset
Management Company Pte. Ltd., Western Asset Management Company Limited and
Western Asset Management Company Ltd (together, the "Investment Managers").
* Each Trustee also serves as a Trustee of Western Asset/Claymore
Inflation-Linked Opportunities & Income Fund, a closed-end investment
company. Western Asset serves as subadviser to Western Asset/Claymore
Inflation-Linked Opportunities & Income Fund. Messrs. Nyberg and Toupin
also serve as Trustees of Claymore Dividend & Income Fund, MBIA
Capital/Claymore Managed Duration Investment Grade Municipal Fund,
TS&W/Claymore Tax-Advantaged Balanced Fund, Madison/Claymore Covered Call &
Equity Strategy Fund, Fiduciary/Claymore MLP Opportunity Fund, Old
Mutual/Claymore Long-Short Fund and Claymore/Guggenheim Strategic
Opportunities Fund, each of which is a closed-end management investment
company, Claymore Exchange-Traded Fund Trust (consisting of 19 separate
portfolios) and Claymore Exchange-Traded Fund Trust 2 (consisting of 16
separate portfolios), each of which is an open-end management investment
company managed by Claymore Advisors, LLC ("Claymore Advisors"), an
affiliate of Claymore Securities, Inc., the Fund's servicing agent.
Additionally, Mr. Nyberg serves as Trustee for Advent Claymore Convertible
Securities & Income Fund, Advent/Claymore Enhanced Growth & Income Fund and
Advent/Claymore Global Convertible Securities & Income Fund, each of which
is a closed-end investment company managed by Claymore Advisors, LLC. Mr.
Gerken serves as Trustee or Director of 147 open- and closed-end management
investment companies associated with Legg Mason & Co. or its affiliates.
Each of these Funds is considered part of the same Fund Complex as the
Fund.
** As discussed below under "Share Ownership Information", Mr. Larson
disclaims beneficial ownership of the Shares of the Fund beneficially owned
by Cascade Investment, L.L.C. and William H. Gates III.
*** Mr. Nyberg shares voting and investment power with respect to these shares.
Additional Information Concerning the Board of Trustees
The Board believes that each Trustee's experience, qualifications,
attributes or skills on an individual basis and in combination with those of
the other Trustees lead to the conclusion that the Board possesses the
requisite skills and attributes. The Board believes that the Trustees' ability
to review, critically evaluate, question and discuss information provided to
them, to interact effectively with the Investment Managers, other service
providers, counsel and independent auditors, and to exercise effective business
judgment in the performance of their duties, support this conclusion. The Board
also has considered the following experience, qualifications, attributes and/or
skills, among others, of its members in reaching its conclusion: his or her
character and integrity; such person's length of service as a board member of
the Fund; such person's willingness to serve and willingness and ability to
commit the time necessary to perform the duties of a Trustee; as to each
Trustee other than Mr. Gerken, his status as not being an ("interested person"
as defined in the 1940 Act) of the Fund; and, as to Mr. Gerken, his status as a
representative of Legg Mason, the parent company of Western Asset. In addition,
the following specific experience, qualifications, attributes and/or skills
apply as to each Trustee:
Mr. Larson: Portfolio management expertise and experience, including
his current position as Chief Investment Officer for William H. Gates III, with
responsibility for all of Mr. Gates' non-Microsoft investments and all of the
investments of the Bill & Melinda Gates Foundation Trust; prior significant
6
experience overseeing fixed income investment strategies and making fixed
income investment decisions at various investment management companies,
including Harris Investment Management, Putnam Management Company and ARCO
Investment Management Company; and experience as a board member of various
businesses and other organizations.
Mr. Nyberg: Business and legal expertise and experience, including
significant experience with the regulatory requirements and other legal matters
applicable to the investment management industry and closed-end funds such as
the Fund as General Counsel for Van Kampen Investments; experience as a senior
partner of a law firm; and experience serving on the boards of investment
companies within the Claymore Advisors fund complex.
Mr. Toupin: Portfolio management expertise and experience, including
significant experience overseeing fixed income investment strategies and making
fixed income investment decisions for investment companies within the Nuveen
Investments fund complex, and experience serving on the boards of investment
companies within the Claymore Advisors fund complex.
Mr. Gerken: Investment management experience as an executive and
portfolio manager and leadership roles within Legg Mason and affiliated
entities, and experience serving on the boards of various investment
companies.
References to the qualifications, attributes and skills of Trustees
above are pursuant to requirements of the Securities and Exchange Commission,
do not constitute holding out of the Board or any Trustee as having any special
expertise or experience, and shall not impose any greater responsibility or
liability on any such person or on the Board by reason thereof.
The Board has determined that its leadership structure is appropriate
given the business and nature of the Fund. In connection with its
determination, the Board considered that the Chairman of the Board is an
Independent Trustee. The Chairman of the Board can play an important role in
setting the agenda of the Board and also serves as a key point person for
dealings between management and the other Independent Trustees. The Independent
Trustees believe that the Chairman's independence facilitates meaningful
dialogue between fund management and the Independent Trustees. The Board also
considered that the chairperson of each Board committee is an Independent
Trustee, which yields similar benefits with respect to the functions and
activities of the various Board committees (e.g., each committee's chairperson
works with management to set agendas for the meetings of the applicable Board
committees). Through the committees, the Independent Trustees consider and
address important matters involving the Fund, including those presenting
conflicts or potential conflicts of interest for management. The Independent
Trustees also regularly meet outside the presence of management and are advised
by independent legal counsel. The Board has determined that its committees help
ensure that the Fund has effective and independent governance and oversight.
The Board also believes that its leadership structure facilitates the orderly
and efficient flow of information to the Independent Trustees from management,
7
including the Investment Managers. The Board also noted that 75% of its members
are Independent Trustees. The Board reviews its structure on an annual basis.
As an integral part of its responsibility for oversight of the Fund
in the interests of shareholders, the Board oversees risk management of the
Fund's investment programs and business affairs. The function of the Board with
respect to risk management is one of oversight not active involvement in, or
coordination of, day-to-day risk management activities for the Fund. The Board
has emphasized to the Investment Managers the importance of maintaining
vigorous risk management. The Board exercises oversight of the risk management
process primarily through the Audit Committee and through oversight by the
Board itself.
The Fund faces a number of risks, such as investment risk,
counterparty risk, valuation risk, reputational risk, risk of operational
failure or lack of business continuity, and legal, compliance and regulatory
risk. Risk management seeks to identify and address risks, i.e., events or
circumstances that could have material adverse effects on the business,
operations, shareholder services, investment performance or reputation of the
Fund. Under the overall supervision of the Board or the applicable Committee,
the Fund, the Investment Managers, the affiliates of the Investment Managers,
and other service providers to the Fund employ a variety of processes,
procedures and controls to identify various of those possible events or
circumstances, to lessen the probability of their occurrence and/or to mitigate
the effects of such events or circumstances if they do occur. Different
processes, procedures and controls are employed with respect to different types
of risks. Various personnel, including the Fund's and Western Asset's CCO and
Western Asset's chief risk officer, as well as various personnel of the
Investment Managers and other service providers such as the Fund's independent
accountants, report to the Audit Committee and/or to the Board from time to
time with respect to various aspects of risk management, as well as events and
circumstances that have arisen and responses thereto. These reports and other
similar reports received by the Trustees as to risk management matters are
typically summaries of the relevant information. The Board recognizes that not
all risks that may affect the Fund can be identified, that it may not be
practical or cost-effective to eliminate or mitigate certain risks, that it may
be necessary to bear certain risks (such as investment-related risks) to
achieve the Fund's goals, and that the processes, procedures and controls
employed to address certain risks may be limited in their effectiveness.
Audit Committee. The Board of Trustees has established an Audit
Committee composed solely of Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Fund or the Investment Managers, consisting of
Messrs. Larson, Nyberg and Toupin (Chairman). Each member of the Audit
Committee is "independent," as independence for audit committee members is
defined in the currently applicable listing standards of the New York Stock
Exchange, on which the Shares of the Fund are listed and traded. The Audit
Committee provides oversight with respect to the accounting and financial
reporting policies and procedures of the Fund and, among other things,
considers the selection of the independent registered public accounting firm
for the Fund and the
8
scope of the audit and approves services proposed to be performed by the
independent registered public accounting firm on behalf of the Fund and, under
certain circumstances, the Investment Manager and certain of its affiliates.
The Trustees have adopted a written charter for the Audit Committee, a copy of
which is attached hereto as Appendix A. The charter is not currently made
available on the Fund's website.
The Audit Committee of the Fund has submitted the following report:
The Audit Committee has reviewed and discussed with management of the
Fund the audited financial statements for the Fund's last fiscal year. The
Audit Committee has discussed with the Fund's independent registered public
accounting firm the matters required to be discussed by Statement on Auditing
Standards No. 114 ("SAS No. 114," which supersedes SAS No. 61). SAS No. 114
requires the independent registered public accounting firm to communicate to
the Audit Committee matters including, if applicable: (1) methods used to
account for significant unusual transactions; (2) the effect of significant
accounting policies in controversial or emerging areas for which there is a
lack of authoritative guidance or consensus; (3) the process used by management
in formulating particularly sensitive accounting estimates and the basis for
the independent registered public accounting firm's conclusions regarding the
reasonableness of those estimates; and (4) disagreements with management over
the application of accounting principles and certain other matters. The Audit
Committee has received the written disclosures and the letter from the Fund's
independent registered public accounting firm required by Public Company
Accounting Oversight Board Rule 3526 (requiring the independent registered
public accounting firm to make written disclosures to and discuss with the
Audit Committee various matters relating to the independent registered public
accounting firm's independence), and has discussed with such independent
registered public accounting firm the independence of such independent
registered public accounting firm. Based on the foregoing review and
discussions, the Audit Committee recommended to the Trustees the inclusion of
the Fund's audited financial statements for the last fiscal year in the Fund's
annual report to shareholders.
Ronald E. Toupin (Chairman)
Michael Larson
Ronald A. Nyberg
Governance and Nominating Committee. The Board of Trustees has
established a Governance and Nominating Committee composed solely of Trustees
who are not "interested persons" (as defined in the 1940 Act) of the Fund or
the Investment Managers, consisting of Messrs. Larson, Nyberg (Chairman) and
Toupin. The Governance and Nominating Committee meets to select nominees for
election as Trustees of the Fund and consider other matters of Board policy.
The Trustees have adopted a written charter for the Governance and Nominating
Committee, a copy of which was attached as Appendix A to the Fund's Proxy
9
Statement dated April 11, 2008. The Fund's charter is not currently made
available on the Fund's website.
The Governance and Nominating Committee requires that Trustee
candidates have a college degree or equivalent business experience, but has not
otherwise established specific minimum qualifications that must be met by an
individual to be considered by the Committee for nomination as a Trustee. The
Governance and Nominating Committee may take into account a wide variety of
factors in considering Trustee candidates, including, but not limited to: (i)
availability and commitment of a candidate to attend meetings and perform his
or her responsibilities to the Board of Trustees, (ii) relevant industry and
related experience, (iii) educational background, (iv) financial expertise, (v)
an assessment of the candidate's ability, judgment and expertise and (vi)
overall diversity of the Board's composition.
Although the Governance and Nominating Committee does not have a
formal policy with regard to the consideration of diversity in identifying
Trustee nominees, as a matter of practice the Committee typically considers the
overall diversity of the Board's composition when identifying nominees.
Specifically, the Governance and Nominating Committee considers the diversity
of skill sets desired among the Board members in light of the Fund's
characteristics and circumstances and how those skill sets might complement
each other. The Governance and Nominating Committee also takes into account the
personal background of current and prospective Board members in considering the
composition of the Board. In addition, as part of its annual self-evaluation,
the Trustees have an opportunity to consider the diversity of the Board, both
in terms of skill sets and personal background, and any observations made by
the Board during the self-evaluation inform the Governance and Nominating
Committee in its decision making process.
The Governance and Nominating Committee may consider candidates for
Trustee recommended by the Fund's current Trustees, officers, Investment
Managers, shareholders or any other source deemed to be appropriate by the
Governance and Nominating Committee. Candidates properly submitted by
shareholders (as described below) will be considered and evaluated on the same
basis as candidates recommended by other sources.
The policy of the Governance and Nominating Committee is to consider
nominees recommended by shareholders to serve as Trustee, provided that any
such recommendation is submitted in writing to the Fund, to the attention of
the Secretary, at the address of the principal executive offices of the Fund,
not less than one hundred and twenty calendar days nor more than one hundred
and thirty-five calendar days prior to the date of the meeting at which the
nominee would be elected and that such shareholder recommendation contains the
information about such nominee required by the Fund's procedures for
shareholders to submit nominee candidates, which are a part of the Governance
and Nominating Committee's Charter. The Governance and Nominating Committee has
full
10
discretion to reject nominees recommended by shareholders, and there is no
assurance that any such person so recommended and considered by the Governance
and Nominating Committee will be nominated for election to the Fund's Board of
Trustees.
Meetings. During 2009, the Board of Trustees held five meetings, the
Audit Committee held three meetings and the Governance and Nominating Committee
held five meetings. Each Trustee attended at least 75% of the aggregate of the
total number of meetings of the Board of Trustees and the Committees of the
Board of Trustees on which he served. The Fund's policies require the Trustees
to attend the Fund's annual shareholder meetings. Each current Trustee attended
the Fund's annual shareholder meeting in May 2009.
Shareholder Communications. The Board of Trustees provides a process
for shareholders to send communications to the Board of Trustees. Shareholders
may mail written communications to the attention of the Board of Trustees, care
of the Fund's Secretary, at the Fund's shareholder servicing agent, Claymore
Securities, Inc., 2455 Corporate West Drive, Lisle, Illinois 60532. The written
communication must include the shareholder's name, be signed by the
shareholder, refer to the Fund, and include the class and number of shares held
by the shareholder as of a recent date.
Trustee Holdings. The following table states the dollar range of
equity securities beneficially owned as of March 1, 2010 by each Trustee and
nominee in the Fund and, on an aggregate basis, in any registered investment
companies overseen or to be overseen by the Trustee or nominee in the same
"family of investment companies."
AGGREGATE DOLLAR RANGE
OF EQUITY SECURITIES IN ALL
FUNDS OVERSEEN OR TO
DOLLAR RANGE BE OVERSEEN BY TRUSTEE
NAME OF OF EQUITY OR NOMINEE IN FAMILY
TRUSTEE/NOMINEE SECURITIES IN THE FUND OF INVESTMENT COMPANIES
--------------------------------------------------------------------------
Independent Trustees
Michael Larson $50,001-$100,000 Over $100,000
Ronald A. Nyberg $1-$10,000 Over $100,000
Ronald E. Toupin, Jr. None None
Interested Trustee
R. Jay Gerken $10,001-$50,000 $50,001-$100,000
Trustee Compensation. Trustees of the Fund who are not Independent
Trustees receive no salary or fees from the Fund. Each Independent Trustee of
the Fund receives a fee of $15,000 annually for serving as a Trustee of the
Fund, and a fee of $1,500 and related expenses for each meeting of the Board of
Trustees
11
attended. The Chairman of the Board of Trustees receives an additional $5,000
per year for serving in that capacity. The Audit Committee Chairman and the
Governance and Nominating Committee Chairman each receive an additional $3,000
annually for serving in their respective capacities. Members of the Audit
Committee and the Governance and Nominating Committee receive $500 for each
committee meeting attended.
For the fiscal year ended December 31, 2009, the Trustees received
the compensation set forth in the following table for serving as Trustees of
the Fund and as Trustees of the other funds in the same "Fund Complex."
TOTAL
PENSION OR COMPENSATION
RETIREMENT ESTIMATED FROM THE
AGGREGATE BENEFITS ANNUAL FUND AND ITS
COMPENSATION ACCRUED AS BENEFITS FUND COMPLEX
NAME OF TRUSTEE FROM PART OF FUND'S UPON PAID TO
OR NOMINEE THE FUND EXPENSES RETIREMENT TRUSTEES(1)
--------------------------------------------------------------------------------
Independent Trustees
Michael Larson $29,500 $0 $0 $59,000
Ronald A. Nyberg $27,500 $0 $0 $354,875
Ronald E. Toupin, Jr. $27,500 $0 $0 $298,375
Interested Trustee
R. Jay Gerken $0 $0 $0 $0
(1) Represents aggregate compensation paid to each Trustee during the fiscal
year ended December 31, 2009 for serving as Trustees to the Fund and other
funds in the Fund Complex. Messrs. Larson, Nyberg, Toupin and Gerken serve
as Trustees to 2, 47, 44 and 147 funds in the Fund Complex, respectively.
During 2009, the Fund paid no remuneration to its officers, all of
whom were also officers or employees of an Investment Manager, Claymore
Securities, Inc. or their respective affiliates.
Required Vote. A plurality of the Shares voted at the Annual Meeting
with respect to a particular Class of Trustees is required to elect a Trustee
nominee as a member of that Class of Trustees. Thus, with respect to Class I,
the Trustee nominee who receives the greatest number of votes properly cast
with respect to the Class I Trustee will be elected as a Class I Trustee. The
Trustees unanimously recommend that shareholders vote to elect Mr. Larson to
the Board of Trustees, as a Class I Trustee.
INFORMATION CONCERNING THE INVESTMENT
MANAGERS AND THE FUND'S OFFICERS
Western Asset is a subsidiary of Legg Mason, Inc., a holding company
which, through its subsidiaries, is engaged in providing investment advisory
services to individuals and institutions. The following three non-U.S.
affiliates of Western Asset serve as investment managers of the Fund: Western
Asset
12
Management Company Pte. Ltd. in Singapore, Reg. No. 200007692R, 1 George Street
#23-01, Singapore 049145, Western Asset Management Company Limited in London,
10 Exchange Square, Primrose Street, London, England EC2A 2EC and Western Asset
Management Company Ltd in Japan, 36F Shin-Marunouchi Building, 5-1 Marunouchi
1-Chome Chiyoda-Ku, Tokyo 100-6536, Japan. The address of Legg Mason, Inc. is
100 Light Street, Baltimore, Maryland 21202. Western Asset's address is 385
East Colorado Boulevard, Pasadena, California 91101. An affiliate of the
Investment Managers, Legg Mason Fund Adviser, Inc., 100 Light Street,
Baltimore, Maryland 21202, serves as the Fund's administrator.
Information regarding the executive officers of the Fund, including
their ages as of February 1, 2010 and their ownership of Shares of the Fund, is
set forth below. Unless otherwise noted, the address of each officer is c/o the
Fund at the address listed above.
TERM OF SHARES OF THE
POSITION(S) OFFICE AND FUND BENEFICIALLY
HELD LENGTH OF PRINCIPAL OCCUPATION(S) OWNED ON
NAME AND AGE WITH FUND TIME SERVED(1) DURING THE PAST 5 YEARS FEBRUARY 1, 2010
----------------------------------------------------------------------------------------------------
R. Jay Gerken Trustee and Served since See "Election of Class I 2,167
58 President March 2007 Trustee" above.
Charles A. Ruys Vice President Served since General Counsel of None
de Perez May 2007 Western Asset Management
52 Company (2007-present).
Formerly: Chief Compliance
Officer, Putnam Investments
(2004-2007); Managing
Director and Senior Counsel
of Putnam Investments
(2001-2004).
Frances M. Treasurer and Served since Director of Legg Mason; None
Guggino Principal May 2009 Chief Financial Officer and
53 Financial and Treasurer of certain mutual
Accounting funds associated with Legg
55 Water Street Officer Mason; formerly, Controller
New York, NY of certain mutual funds
10041 associated with Citigroup
Asset Management ("CAM")
(1999-2004).
Steven M. Hill Assistant Served since Senior Managing Director None
45 Treasurer May 2004 of Claymore Advisors, LLC
and Claymore Securities, Inc.
2455 Corporate (2005- present); Chief Financial
West Drive Officer of Claymore Group Inc.
Lisle, IL 60532 (2005-2006); Managing Director
of Claymore Advisors, LLC and
Claymore Securities, Inc. (2003-
2005); Chief Financial and
Accounting Officer and Treasurer
or Assistant Treasurer of certain
closed-end investment companies
in the Claymore fund complex;
Treasurer of Henderson Global
Funds and Operations Manager for
Henderson Global Investors (North
America) Inc. (2002- 2003).
13
TERM OF SHARES OF THE
POSITION(S) OFFICE AND FUND BENEFICIALLY
HELD LENGTH OF PRINCIPAL OCCUPATION(S) OWNED ON
NAME AND AGE WITH FUND TIME SERVED(1) DURING THE PAST 5 YEARS FEBRUARY 1, 2010
----------------------------------------------------------------------------------------------------
Susan C. Curry Assistant Served since Director of Tax--Mutual None
43 Treasurer February 2007 Funds, Legg Mason & Co.
(2005- present); Director of
125 Broad St. Tax-- Mutual Funds,
New York, NY Citigroup (2004- 2005);
10004 Assistant Treasurer, Western
Asset Funds, Inc., Western
Asset Income Fund, Western
Asset Premier Bond Fund,
Western Asset/Claymore
Inflation-Linked Opportunities
& Income Fund (2007-present);
Partner, Deloitte & Touche
(1990-2004).
Erin K. Morris Assistant Served since Vice President and Manager, None
43 Treasurer August 2003 Global Funds Administration,
Legg Mason & Co. (2005-
100 International present); Assistant Vice President
Drive and Manager of Legg Mason
Baltimore, MD Wood Walker, Incorporated (2002-
21202 2005); Treasurer of Western
Asset Income Fund, Western Asset
Funds, Inc. and Western Asset
Premier Bond Fund (2006- present);
Assistant Treasurer, Legg Mason
Partners Fund fixed income complex
(2007-present). Western
Asset/Claymore Inflation-Linked
Securities & Income Fund (2003-
present). Western Asset/Claymore
Inflation-Linked Opportunities &
Income Fund (2004-present);
Formerly Assistant Treasurer,
Western Asset Income Fund,
Western Asset Funds, Inc., Western
Asset Premier Bond Fund, Legg
Mason Income Trust, Inc. and Legg
Mason Tax-Free Income Fund
(2001-2006).
Todd F. Kuehl Chief Served since Vice President, Legg Mason & None
40 Compliance February 2007 Co. (2006-present); Chief
Officer Compliance Officer of Western
100 Light Street Asset/Claymore Inflation-Linked
Baltimore, MD Opportunities & Income Fund,
21202 Western Asset Income Fund,
Western Asset Premier Bond Fund,
Western Asset Funds, Inc. (2007-
present) and Barrett Growth Fund
and Barrett Opportunity Fund (2006-
present); Branch Chief, Division of
Investment Management, U.S.
Securities and Exchange
Commission (2002-2006).
14
TERM OF SHARES OF THE
POSITION(S) OFFICE AND FUND BENEFICIALLY
HELD LENGTH OF PRINCIPAL OCCUPATION(S) OWNED ON
NAME AND AGE WITH FUND TIME SERVED(1) DURING THE PAST 5 YEARS FEBRUARY 1, 2010
----------------------------------------------------------------------------------------------------
Melissa J. Nguyen Secretary Served since Vice President and Assistant None
31 February 2006 General Counsel of Claymore
Group Inc. (2005-present);
2455 Corporate Secretary of certain funds in
West Drive the Claymore fund complex
Lisle, IL 60532 (2006- present). Formerly,
Associate, Vedder Price P.C.
(2003-2005).
Mark E. Mathiasen Assistant Served since Vice President and Assistant None
31 Secretary May 2007 General Counsel of Claymore
Group Inc. (2007 to present).
2455 Corporate Secretary of certain funds in the
West Drive Claymore fund complex.
Lisle, IL 60532 Previously, Law Clerk for the
Idaho State Courts (2003-2007).
(1) Each officer holds office until his or her respective successor is chosen
and qualified, or in each case until he or she sooner dies, resigns, is
removed with or without cause or becomes disqualified.
SHAREHOLDER PROPOSALS FOR 2011 ANNUAL MEETING
It is currently anticipated that the Fund's next annual meeting of
shareholders will be held in May 2011. Proposals that shareholders wish to
present to the 2011 Annual Meeting and to have included in the Fund's proxy
materials relating to such meeting pursuant to Rule 14a-8 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), must be delivered to the
Secretary of the Fund not less than 120 days prior to April 16, 2011 (i.e., on
or before December 17, 2010).
Shareholders who wish to propose one or more nominees for election as
Trustees, or to make another proposal, at the 2011 annual meeting must provide
written notice to the Fund (including all required information) so that such
notice is received in good order by the Fund not less than 45 days, nor more
than 60 days, prior to April 16, 2011 (i.e., no earlier than February 15, 2011
and no later than March 2, 2011).
The proper submission of a shareholder proposal does not guarantee
that it will be included in the Fund's proxy materials or presented at a
shareholder meeting. Shareholder proposals are subject to the requirements of
applicable law and the Fund's Declaration of Trust and Bylaws.
15
SHARE OWNERSHIP INFORMATION
As of March 1, 2010, all Trustees, the nominee for Trustee and
officers of the Fund as a group beneficially owned less than 1% of the
outstanding Shares of the Fund. As of April 1, 2010, Cede & Co., as nominee for
participants in The Depository Trust Company, held of record 29,107,875 Shares
(representing approximately 99.84% of the outstanding Shares). Cede & Co.'s
address is 55 Water Street, 25th Floor, New York, New York 10041-0001. As of
April 1, 2010, the persons shown in the table below owned, to the knowledge of
the Fund, beneficially more than five percent of the outstanding Shares.
SHAREHOLDER NAME AND ADDRESS SHARE HOLDINGS PERCENTAGE OWNED
Cascade Investment, L.L.C. and William H. Gates III 4,224,510 14.49%
(as sole member of Cascade Investment, L.L.C.)(1)(2)
Cascade Investment, L.L.C. - 2365 Carillon Point,
Kirkland, WA 98033
William H. Gates III -- One Microsoft Way,
Redmond, WA 98052
Wells Fargo & Company(3) 2,696,293 9.25%
420 Montgomery Street
San Francisco, CA 94163
First Trust Portfolios L.P(4) 3,011,972 10.3%
First Trust Advisors L.P.
The Charger Corporation
120 East Liberty Drive, Suite 400
Wheaton, IL 60187
(1) Based on information obtained from a Schedule 13D filed with the Securities
and Exchange Commission on October 17, 2008.
(2) Mr. Larson is the Business Manager of Cascade Investment, L.L.C. and has
voting and investment power with respect to the Shares held by Cascade
Investment, L.L.C, but disclaims any beneficial ownership of the Shares
beneficially owned by Cascade Investment, L.L.C. and Mr. Gates.
(3) Based on information obtained from a Schedule 13G filed with the Securities
and Exchange Commission on January 26, 2010.
(4) Based on information obtained from a Schedule 13G filed with the Securities
and Exchange Commission on January 14, 2010.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 30(h) of the 1940 Act and Section 16(a) of the Exchange Act
require the Fund's officers and Trustees, the Investment Managers, certain
affiliates of the Investment Managers, and persons who beneficially own more
than ten percent of a registered class of the Fund's equity securities, among
others, to file reports of ownership and changes in ownership with the
Securities and Exchange Commission ("SEC") and the New York Stock Exchange.
These persons are required by SEC regulation to furnish the Fund with copies of
all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by
it, or written representations from certain reporting persons, the Fund
believes that, during 2009, all such filing requirements were met with respect
to the Fund.
16
ANNUAL REPORT TO SHAREHOLDERS
The Fund's Annual Report to Shareholders for the fiscal year ended
December 31, 2009 contains financial and other information pertaining to the
Fund. The Fund will furnish without charge to each person whose proxy is being
solicited, upon request of such person, a copy of the Annual Report to
Shareholders. Requests for copies of the Annual Report to Shareholders should
be directed to Western Asset/Claymore Inflation-Linked Securities & Income
Fund, c/o Claymore Securities, Inc., 2455 Corporate West Drive, Lisle, Illinois
60532 or you may call 1-866-486-2228.
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee of the Board of Trustees has selected
PricewaterhouseCoopers LLP as the independent registered public accounting firm
of the Fund for the fiscal year ending December 31, 2010, and the Board of
Trustees, including a majority of the Trustees who are not "interested persons"
(as defined in the 1940 Act) of the Fund, has unanimously ratified such
selection. PricewaterhouseCoopers LLP's service is subject to termination by a
majority of the outstanding Shares of the Fund. Representatives of
PricewaterhouseCoopers LLP are not currently expected to attend the Annual
Meeting.
The following table presents fees billed in each of the Fund's last
two fiscal years for services rendered to the Fund by PricewaterhouseCoopers
LLP:
Audit Audit-Related
Fiscal year ended Fees Fees Tax Fees All Other Fees
----------------- -------- --------------- -------- --------------
December 31, 2008 $30,000 $0 $4,000 $0
December 31, 2009 $31,500 $0 $4,000 $0
"Audit Fees" represents fees billed for each of the last two fiscal
years for professional services rendered for the audit of the Fund's financial
statements for those fiscal years and services that are normally provided by
the accountant in connection with statutory or regulatory filings or
engagements for that fiscal year.
"Audit Related Fees" represents fees billed for each of the last two
fiscal years for assurance and related services reasonably related to the
performance of the audit of the Fund's annual financial statements for those
years.
"Tax Fees" represents fees billed for each of the last two fiscal
years for professional services related to tax compliance, tax advice and tax
planning, including preparation of federal and state income tax returns and
preparation of excise tax returns.
"All Other Fees" represents fees, if any, billed for other products
and services rendered by PricewaterhouseCoopers LLP to the Fund for the last
two fiscal years.
For the Fund's fiscal years ended December 31, 2008 and December 31,
2009, PricewaterhouseCoopers LLP billed aggregate non-audit fees in the amounts
of $362,500 and $0, respectively, to the Fund, the Investment Manager and any
17
entity controlling, controlled by or under common control with the Investment
Manager that provides ongoing services to the Fund.
Pre-Approval Policies of the Audit Committee. The Audit Committee has
determined that all work performed for the Fund by PricewaterhouseCoopers LLP
will be pre-approved by the full Audit Committee and, therefore, has not
adopted pre-approval procedures. Since the Fund's inception in July 2003, all
audit and non-audit services performed by PricewaterhouseCoopers LLP for the
Fund, and all non-audit services performed by PricewaterhouseCoopers LLP for
the Investment Manager and any entity controlling, controlled by or under
common control with the Investment Manager that provides ongoing services to
the Fund (a "Service Affiliate"), to the extent that such services related
directly to the operations and financial reporting of the Fund, have been
pre-approved by the Audit Committee. No "Audit-Related Fees," "Tax Fees" and
"Other Fees" set forth in the table above were waived pursuant to paragraph
(c)(7)(i)(c) of Rule 2-01 of Regulation S-X. PricewaterhouseCoopers LLP billed
"Audit-Related Fees" in the amount of $234,500 and $228,500, respectively, for
non-audit services (a SAS 70 audit to review and test operating effectiveness
of controls placed in operation for the Investment Manager and a review of the
Investment Manager's Australian Superannuation Circular) that required
pre-approval by the Audit Committee pursuant to paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X during the Fund's fiscal years ended December 31, 2008
and December 31, 2009. PricewaterhouseCoopers LLP did not bill any "Tax Fees"
or "All Other Fees" that required pre-approval by the Audit Committee pursuant
to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X during the Fund's fiscal
years ended December 31, 2008 and December 31, 2009.
The Audit Committee has considered whether the provision of the
non-audit services rendered by PricewaterhouseCoopers LLP to the Investment
Manager and any Service Affiliate that were not required to be pre-approved by
the Audit Committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation
S-X is compatible with maintaining the independence of PricewaterhouseCoopers
LLP.
ADJOURNMENT
In the absence of a quorum at the Annual Meeting, or (even if a
quorum is present) if sufficient votes in favor of a proposal set forth in the
Notice of Annual Meeting are not received by the time scheduled for the Annual
Meeting, the persons named as proxies may propose one or more adjournments of
the Annual Meeting after the date set for the original Annual Meeting, with no
other notice than announcement at the Annual Meeting, to permit further
solicitation of proxies with respect to such proposal. In addition, if, in the
judgment of the persons named as proxies, it is advisable to defer action on a
proposal, the persons named as proxies may propose one or more adjournments of
the Annual Meeting with respect to such proposal for a reasonable time. Any
adjournment(s) with respect to a proposal will require the affirmative vote of
a plurality of the Shares of the Fund entitled to vote thereon present in
person or represented by proxy at the session of the Annual Meeting to be
adjourned. The persons named as proxies will vote in
18
favor of such adjournment those proxies which they are entitled to vote in
favor of the proposal in question. They will vote against any such adjournment
those proxies required to be voted against such proposal. The costs of any
additional solicitation and of any adjourned session will be borne by the Fund.
Any proposals for which sufficient favorable votes have been received by the
time of the Annual Meeting may be acted upon and, if so, such action will be
final regardless of whether the Annual Meeting is adjourned to permit
additional solicitation with respect to any other proposal.
OTHER BUSINESS
The Fund is not aware of any other matters to be presented for action
at the Annual Meeting. However, if any such other matters are properly
presented, it is the intention of the persons designated in the enclosed proxy
to vote in accordance with their best judgment.
By Order of the Board of Trustees
/s/ Melissa J. Nguyen, Secretary
April 14, 2010
19
EXHIBIT A
WESTERN ASSET/CLAYMORE INFLATION-LINKED SECURITIES &
INCOME FUND
AUDIT COMMITTEE CHARTER
REVISED AS OF FEBRUARY 22, 2010
The Board of Trustees (the "Board") of Western Asset/Claymore
Securities & Income Fund and Western Asset/Claymore Opportunities & Income Fund
(each a "Fund" and, collectively, the "Funds") has adopted this Charter to
govern the activities of the Audit Committee of the Board with respect to its
oversight of each Fund. This Charter applies separately to each Fund and its
Board and Audit Committee, and shall be interpreted accordingly.
The Audit Committee of the Board shall be comprised entirely of
"independent" Trustees, as such term is interpreted for purposes of Section
10A(m)(3) of the Securities Exchange Act of 1934, as amended, and the listing
standards of the New York Stock Exchange (the "Exchange"). The Audit Committee
shall have at least three members, who shall collectively satisfy the
independence and expertise requirements of the Exchange.
The purposes of the Audit Committee shall be:
(a) to assist with the Board's oversight of the integrity of the Fund's
financial statements, the Fund's compliance with legal and regulatory
requirements, the qualifications and independence of the Fund's
independent auditors, and the performance of the Fund's internal
control systems and independent auditors;
(b) to oversee generally the Fund's accounting and financial reporting
policies and practices, the Fund's internal controls and, as
appropriate, the internal controls of certain service providers;
(c) to oversee generally the quality and objectivity of the Fund's
financial statements and the independent audit thereof;
(d) to act as a liaison between the Fund's independent auditors and the
full Board; and
(e) to oversee the preparation of the report required by Item 407(d)(3)(i)
of Regulation S-K to be included in the proxy statement of the Fund if
the proxy statement relates to the election of Trustees of the Fund.
To carry out its purposes and responsibilities, the Audit Committee
shall have the duty and power to:
(a) be directly responsible for the appointment, termination,
compensation, and oversight of the work of the independent auditors
A-1
engaged by the Fund for the purpose of preparing or issuing an audit
report or performing other audit, review or attest services for the
Fund, including resolution of disagreements between management and the
independent auditors regarding financial reporting. The independent
auditors shall report directly to the Audit Committee, and the Audit
Committee shall have ultimate authority for all audit engagement fees
and terms. The Board and the Fund's shareholders shall have such
rights to approve, ratify and replace the Fund's independent auditors
as are provided by applicable law.
(b) consider the independence of the Fund's independent auditors, and in
connection therewith to obtain at least annually formal written
reports from the auditors regarding the auditors' independence,
including a delineation of all relationships between the auditors and
the Fund, discuss with the auditors any disclosed relationships or
services that may impact the objectivity and independence of the
auditors, and if so determined by the Audit Committee, recommend that
the Board take appropriate action to satisfy itself of the
independence of the auditors.
(c) meet with the Fund's independent auditors, including private meetings,
as necessary (i) to review the arrangements for and scope of the
annual audit and any special audits; (ii) to discuss any matters of
concern relating to the Fund's financial statements, including any
adjustments to such statements recommended by the independent
auditors, or other results of said audit; (iii) to consider the
independent auditors' comments with respect to the Fund's financial
policies, procedures and internal accounting controls and the
responses of Claymore Advisors, LLC, Western Asset Management Company,
Western Asset Management Company Limited, Western Asset Management
Company Ltd. and Western Asset Management Company Pte. Ltd. (each a
"Manager"), as applicable, thereto; and (iv) to review the form of
opinion the auditors propose to render to the Board and the Fund's
shareholders.
(d) review and discuss with management and the independent auditors the
Fund's annual financial statements, including any narrative discussion
by management concerning the Fund's financial condition and investment
performance.
(e) review and discuss with management the Fund's semi-annual financial
statements, including, any narrative discussion by management
concerning the Fund's financial condition and investment performance.
(f) review major issues regarding accounting principles and financial
statement presentations, including, to the extent applicable: (A) any
significant changes in management's selection or application of
A-2
accounting principles for the Fund, and major issues as to the
adequacy of the Fund's internal controls and any special audit steps
adopted in light of material control deficiencies; (B) analyses
prepared by management and/or the independent auditors setting forth
significant reporting issues and judgments made in connection with the
preparation of the Fund's financial statements, including analyses of
the effects of alternative GAAP methods on the financial statements;
and (C) the effect of regulatory and accounting initiatives, as well
as off-balance sheet structures, on the Fund's financial statements.
(g) consider the effect upon the Fund of any changes in accounting
principles or practices proposed by the Managers or the auditors.
(h) pre-approve, to the extent contemplated by applicable regulations,
audit and non-audit services rendered to the Fund by the auditors and
non-audit services rendered to the Managers and certain of their
affiliates by the auditors, and review the fees charged by the
auditors for such services; provided, however, that the Audit
Committee may implement policies and procedures pursuant to which
services are pre-approved other than by the full Audit Committee,
subject to the requirement that the full Audit Committee be notified
in a timely manner of each such service.
(i) establish procedures for (A) the receipt, retention, and treatment of
complaints received by the Fund regarding accounting, internal
accounting controls, or auditing matters, and (B) the confidential,
anonymous submission by employees of the Fund, the Fund's investment
adviser(s), administrator, principal underwriter (if any) or any other
provider of accounting-related services for the Fund of concerns
regarding questionable accounting or auditing matters.
(j) if and to the extent that the Fund intends to have employees, set
clear policies for the hiring by the Fund of employees or former
employees of the Fund's independent auditors.
(k) obtain and review at least annually a report from the independent
auditors describing (i) the independent auditors' internal quality-
control procedures and (ii) any material issues raised by the
independent auditors' most recent internal quality-control review or
peer review or by any governmental or other professional inquiry or
investigation performed within the preceding five years respecting one
or more independent audits carried out by the independent auditors,
and any steps taken to address any such issues.
(l) review with the independent auditors any audit problems or
difficulties encountered in the course of their audit work and
management's responses thereto.
A-3
(m) discuss with management any press releases discussing the Fund's
investment performance and other financial information about the Fund,
as well as any financial information and earnings guidance provided by
management to analysts or rating agencies. The Audit Committee may
discharge this responsibility by discussing the general types of
information to be disclosed by the Fund and the form of presentation
(i.e., a case-by-case review is not required) and need not discuss in
advance each such release of information.
(n) discuss with management its guidelines and policies with respect to
risk assessment and risk management.
(o) review such other matters or information that it believes may be
relevant to the auditors, the audit engagement or the Fund's financial
policies and procedures or internal accounting controls.
(p) report its activities to the full Board on a regular basis.
The Audit Committee shall also have the power to make such
recommendations with respect to the above and other matters as it may deem
necessary or appropriate.
The Audit Committee shall meet on a regular basis and be empowered to
hold special meetings, as circumstances require. Any action of the Audit
Committee may be taken without a meeting if at least a majority of the members
of the Audit Committee consent thereto in writing.
At least annually, the Audit Committee shall meet separately with the
independent auditors and separately with the representatives of Fund management
responsible for the financial and accounting operations of the Fund. The Audit
Committee shall regularly meet with the Treasurer of the Fund and may seek to
meet with internal auditors, if any, for the Manager as circumstances warrant.
The Audit Committee shall have the resources and authority
appropriate to discharge its responsibilities, including the authority to
retain special counsel and other experts or consultants. The Fund shall provide
the necessary funding, as determined by the Audit Committee, to compensate the
Fund's independent auditors and any advisers employed by the Audit Committee,
as well as for the payment of ordinary administrative expenses of the Audit
Committee that are necessary or appropriate in carrying out its duties. The
Audit Committee may request any officer or employee of the Fund or of any of
the Fund's service providers or the Fund's outside counsel or independent
auditors to attend a meeting of the Audit Committee or to meet with any member
of, or consultants to, the Audit Committee.
Nothing in this Charter shall be construed to reduce the
responsibilities or liabilities of the Manager(s) or the Fund's independent
auditors. The function of the Audit Committee shall be oversight; it shall be
the responsibility of the Manager(s) to maintain appropriate systems for
accounting and internal control;
A-4
the independent auditors' responsibility to plan and carry out a proper audit
and report thereon to the Board and shareholders, as required by law; and
management's and the independent auditors' responsibility to determine that the
Fund's financial statements are accurate and complete and in accordance with
generally accepted accounting principles. Members of the Audit Committee are
not employees of the Funds and, in serving on this Audit Committee, are not,
and do not hold themselves out to be, acting as auditors. As such, it is not
the duty or responsibility of the Audit Committee or its members to conduct
"field work" or other types of auditing or accounting reviews or procedures.
Each member of the Audit Committee shall be entitled to rely on (i) the
integrity of those persons and organizations within management and outside the
Fund from which the Audit Committee receives information and (ii) the accuracy
of financial and other information provided to the Audit Committee by such
persons or organizations absent actual knowledge to the contrary.
The Audit Committee shall assess its own performance at least
annually.
A-5
ANNUAL MEETING OF SHAREHOLDERS OF
WESTERN ASSET/CLAYMORE
INFLATION-LINKED SECURITIES & INCOME FUND
MAY 25, 2010
-------------------------
PROXY VOTING INSTRUCTIONS
-------------------------
TELEPHONE - Call toll-free 1-800-PROXIES (1-800-776-9437) in the United States ------------------ --------------
or 1-718-921-8500 from foreign countries from any touch-tone telephone and COMPANY NUMBER
follow the instructions. Have your proxy card available when you call and use ------------------ --------------
the Company Number and Account Number shown on your proxy card. ACCOUNT NUMBER
------------------ --------------
Vote by phone until 11:59 PM EST the day before the meeting.
------------------ --------------
MAIL - Sign, date and mail your proxy card in the envelope provided as soon as
possible.
IN PERSON - You may vote your shares in person by attending the Annual Meeting.
--------------------------------------------------------------------------------
NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIAL: The Notice of Meeting,
proxy statement and proxy card are available at
http://www.materials.proxyvote.com/Claymore2010WIA.pdf
--------------------------------------------------------------------------------
Please detach along perforated line and mail in the envelope provided IF you
are not voting via telephone.
10000000000000000000 9 052510
--------------------------------------------------------------------------------
THE BOARD OF TRUSTEES RECOMMENDS A VOTE "FOR" THE ELECTION OF THE NOMINEE.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK
YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
--------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
1. ELECTION OF CLASS I TRUSTEE: In their discretion, the proxies are authorized to vote upon
such other business as may properly come before the Annual
NOMINEE: Meeting or any adjournment(s) or postponement(s) thereof.
This proxy when properly executed will be voted as directed
[ ] FOR THE NOMINEE Michael Larson Class I Trustee herein by the undersigned shareholder. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED FOR THE NOMINEE IN PROPOSAL
[ ] WITHHOLD AUTHORITY 1.
FOR THE NOMINEE
To change the address on your account, please check the box at right
and indicate your new address in the address space above. Please note [ ]
that changes to the registered name(s) on the account may not be
submitted via this method.
------------------------------- ------------- -------------------------------- --------------
Signature of Signature of
Shareholder Date: Shareholder Date:
------------------------------- ------------- -------------------------------- --------------
NOTE: Please sign exactly as your name or names appear on this Proxy. When
signing as executor, guardian, please shares are held jointly, each
holder should sign. administrator, attorney, trustee Whenor give full
title as such. If the signer is a corporation, please sign full
corporate name by duly authorized officer, giving full title as such.
If signer is a partnership, please sign in partnership name by
authorized person.
WESTERN ASSET/CLAYMORE INFLATION-LINKED SECURITIES & INCOME FUND
Dear Shareholder:
Please take note of the important information enclosed with this Proxy Ballot.
Your vote counts, and you are strongly encouraged to exercise your right to vote
your shares.
Please mark the boxes on this proxy card to indicate how your shares will be
voted. Then sign the card and return your proxy vote in the enclosed postage
paid envelope. Your vote must be received prior to the Annual Meeting of
Shareholders, May 25, 2010.
Thank you in advance for your prompt consideration of this matter.
Sincerely,
Western Asset/Claymore Inflation-Linked Securities & Income Fund
0
WESTERN ASSET/CLAYMORE INFLATION-LINKED
SECURITIES & INCOME FUND
COMMON SHARES
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS ON MAY 25, 2010
SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
AS AN ALTERNATIVE TO COMPLETING THIS FORM, YOU MAY ENTER YOUR VOTE INSTRUCTION
BY TELEPHONE AT 1-800-PROXIES, AND FOLLOW THE SIMPLE INSTRUCTIONS. USE THE
COMPANY NUMBER AND ACCOUNT NUMBER SHOWN ON YOUR PROXY CARD.
The undersigned hereby appoints R. Jay Gerken, Melissa J. Nguyen and Kevin
M. Robinson, and each of them, attorneys and proxies of the undersigned, each
with full power of substitution, to attend the Annual Meeting of Shareholders of
Western Asset/Claymore Inflation-Linked Securities & Income Fund, a
Massachusetts business trust (the "Fund"), to be held at 2455 Corporate West
Drive, Lisle, Illinois, on May 25, 2010, at 2:30 p.m., Central time, and at any
adjournment(s) or postponement(s) thereof, and thereat to vote as indicated all
common shares of beneficial interest of the Fund which the undersigned would be
entitled to vote if personally present with respect to the matters listed on the
reverse, which are more fully described in the Notice of Meeting and Proxy
Statement of the Fund, receipt of which is acknowledged by the undersigned.
This proxy will be governed by and construed in accordance with the laws of The
Commonwealth of Massachusetts and applicable federal securities laws. The
execution of this proxy is not intended to, and does not, revoke any prior
proxies or powers of attorney other than the revocation, in accordance with The
Commonwealth of Massachusetts and applicable federal securities laws, of any
proxy previously granted specifically in connection with the voting of the
shares of the Fund subject hereto.
(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE.) 14475
ANNUAL MEETING OF SHAREHOLDERS OF
WESTERN ASSET/CLAYMORE
INFLATION-LINKED SECURITIES & INCOME FUND
MAY 25, 2010
NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIAL:
-------------------------------------------------
The Notice of Meeting, proxy statement and proxy card
are available at http://www.materials.proxyvote.com/Claymore2010WIA.pdf
Please sign, date and mail
your proxy card in the
envelope provided as soon
as possible.
Please detach along perforated line and mail in the envelope
provided.
10000000000000000000 9 052510
--------------------------------------------------------------------------------
THE BOARD OF TRUSTEES RECOMMENDS A VOTE "FOR" THE ELECTION OF THE NOMINEE.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
--------------------------------------------------------------------------------
1. ELECTION OF CLASS I TRUSTEE: In their discretion, the proxies are authorized to vote upon
such other business as may properly come before the Annual
NOMINEE: Meeting or any adjournment(s) or postponement(s) thereof.
Class I This proxy when properly executed will be voted as directed
[ ] FOR THE NOMINEE Michael Larson Trustee herein by the undersigned shareholder. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED FOR THE NOMINEE IN PROPOSAL
WITHHOLD 1.
[ ] AUTHORITY
FOR THE NOMINEE
--------------------------------------------------------------------------------
To change the address on your account, please check the box at right
and indicate your new address in the address space above. Please note [ ]
that changes to the registered name(s) on the account may not be
submitted via this method.
--------------------------------------------------------------------------------
--------------------------------- ------------- --------------------------------- -------------
Signature of Signature of
Shareholder Date: Shareholder Date:
--------------------------------- ------------- --------------------------------- -------------
NOTE: Please sign exactly as your name or names appear on this Proxy. When
signing as executor, guardian, please shares are held jointly, each
holder should sign. administrator, attorney, trustee Wheor give full
title as such. If the signer is a corporation, please sign full
corporate name by duly authorized officer, giving full title as such.
If signer is a partnership, please sign in partnership name by
authorized person.