UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-21309
Advent Claymore Convertible Securities and Income Fund
------------------------------------------------------
(Exact name of registrant as specified in charter)
1065 Avenue of the Americas New York, NY 10018
----------------------------------------- ----------
(Address of principal executive offices) (Zip code)
Bruce S. Berger, Treasurer
Advent Claymore Convertible Securities and Income Fund
1065 Avenue of the Americas New York, NY 10018
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(Name and address of agent for service)
Registrant's telephone number, including area code: 1-212-386-7407
Date of fiscal year end: October 31, 2004
Date of reporting period: October 31, 2004
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. Section 3507.
Item 1. Reports to Stockholders.
The registrant's annual report transmitted to shareholders pursuant to Rule
30e-1 under the Investment Company Act of 1940 is as follows: [Provide full text
of semi-annual report.]
Annual Advent Claymore Convertible |
Report Securities and Income Fund | AVK
October 31, 2004 |
[GRAPHIC APPEARS HERE]
[LOGO OF ADVENTCAPITAL MANAGEMENT, LLC] [LOGO OF CLAYMORE(R)]
AVK | Advent Claymore Convertible Securities and Income Fund
As of October 31, 2004 (unaudited)
Average Annual Total Returns
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(Inception 4/30/03) Market NAV
---------------------------------------------------------------
One Year 11.44% 8.93%
Since Inception 9.88% 15.02%
---------------------------------------------------------------
% of Long-Term
Top Ten Sectors Investments
---------------------------------------------------------------
Telecommunications 13.1%
Insurance 11.9%
Communications, Media and Entertainment 10.1%
Financial Services 7.5%
Utilities - Gas and Electric 6.2%
Electronic Equipment and Components 4.9%
Automotive 4.6%
Banking and Finance 4.6%
Oil and Gas 3.6%
Communications Equipment 3.4%
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% of Long-Term
Top Ten Issuers Investments
---------------------------------------------------------------
Lucent Technologies 2.8%
Ford Motor Company Capital Trust 2.4%
ALLTEL Corp. 2.3%
Chubb Corp. 2.1%
The Hartford Financial Services Group, Inc. 2.0%
Northrop Grumman Corp. 2.0%
Xerox Corp. 2.0%
Echostar Communications Corp. 1.9%
FPL Group, Inc. 1.9%
Marshall & Ilsley Corp. 1.8%
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Share Price & NAV Performance
[GRAPHIC APPEARS HERE]
Monthly Dividends Per Share
[GRAPHIC APPEARS HERE]
Portfolio Composition (%of Total Investments)
[GRAPHIC APPEARS HERE]
Annual Report | October 31, 2004 | 1
AVK | Advent Claymore Convertible Securities and Income Fund
October 31, 2004
Number of Shares Value
--------------------------------------------------------------------------------
Long-Term Investment - 137.2%
Convertible Preferred Stocks - 57.2%
Aerospace and Defense - 2.8%
52,500 Northrop Grumman Corp., Ser. B, 7.00%, 2021 $ 6,825,000
98,000 Northrop Grumman Corp., Ser. E, 7.25%, 2004 10,036,180
--------------------------------------------------------------------------------
16,861,180
--------------------------------------------------------------------------------
Automotive - 3.3%
400,000 Ford Motor Company Capital Trust II,
6.50%, 2032 19,996,000
--------------------------------------------------------------------------------
Banking and Finance - 6.3%
557,500 Marshall & Ilsley Corp., 6.50%, 2007 15,164,000
125,000 National Australia Bank, Equity Security
Unit, 7.875% 4,468,750
200,000 Sovereign Capital Trust IV, 4.375%, 2034 9,525,000
170,000 Washington Mutual, Inc., Equity Security
Unit, 5.375%, 2041 9,095,000
--------------------------------------------------------------------------------
38,252,750
--------------------------------------------------------------------------------
Communications Equipment - 2.0%
10,400 Lucent Technologies Capital Trust I, 7.75%, 2017 12,187,552
--------------------------------------------------------------------------------
Communications, Media and
Entertainment - 2.4%
179,703 Emmis Communications Corp., Ser. A, 6.25% 7,718,244
150,000 Interpublic Group of Cos., Ser. A,
5.375%, 2006 6,960,000
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14,678,244
--------------------------------------------------------------------------------
Electronic Equipment and Components - 0.5%
61,000 Agilysys, Inc., 6.75%, 2028 3,385,500
--------------------------------------------------------------------------------
Financial Services - 3.3%
100,000 Goldman Sachs Group, Inc., 6.75%, 2006 10,640,500
389,120 Lehman Brothers Holdings, Inc., Ser.
GIS, 6.25%, 2007 9,755,238
--------------------------------------------------------------------------------
20,395,738
--------------------------------------------------------------------------------
Insurance - 16.3%
462,150 Chubb Corp., Ser. A, 7.00%, 2005 12,912,471
165,000 Chubb Corp., Ser. B, 7.00%, 2006 4,661,250
453,922 Genworth Financial, Inc., 6.00%, 2007 13,290,836
196,000 Prudential Financial, Inc., 6.75%, 2004 13,527,920
70,000 Reinsurance Group of America, Equity Security
Unit, 5.75%, 2050 4,130,000
141,300 The Hartford Financial Services
Group, Inc., 6.00%, 2006 7,962,255
159,000 The Hartford Financial Services
Group, Inc., 7.00%, 2006 9,121,830
367,000 The PMI Group, Inc., Ser. A, 5.875%, 2006 9,175,000
417,497 UnumProvident Corp., 8.25%, 2006 12,403,836
500,000 XL Capital Ltd., 6.50%, 2007 12,000,000
--------------------------------------------------------------------------------
99,185,398
--------------------------------------------------------------------------------
Office Equipment - 2.1%
99,600 Xerox Corp., 6.25%, 2006 $ 13,164,132
--------------------------------------------------------------------------------
Oil and Gas - 1.5%
121,507 Amerada Hess Corp., 7.00%, 2006 8,900,388
--------------------------------------------------------------------------------
Real Estate Investment Trusts - 1.4%
155,000 Simon Property Group LP, 6.00% 8,427,350
--------------------------------------------------------------------------------
Retail - Specialty Stores - 2.4%
301,500 Toys "R" Us, Inc., 6.25%, 2005 14,475,015
--------------------------------------------------------------------------------
Telecommunications - 4.7%
384,447 ALLTEL Corp., 7.75%, 2005 19,491,463
369,728 CenturyTel, Inc., Ser. A, 6.875%, 2005 9,298,659
--------------------------------------------------------------------------------
28,790,122
--------------------------------------------------------------------------------
Utilities - Gas and Electric - 8.2%
99,085 AES Trust VII, 6.00%, 2008 4,842,779
239,269 Aquila, Inc., 6.75%, 2007 7,321,632
221,000 FPL Group, Inc., Ser. A, 8.50%, 2005 12,632,360
52,900 FPL Group, Inc., Ser. B, 8.00%, 2006 3,002,075
210,000 KeySpan Corp., 8.75%, 2005 11,256,000
320,800 Oneok, Inc., 8.50%, 2006 10,804,544
--------------------------------------------------------------------------------
49,859,390
--------------------------------------------------------------------------------
Total Convertible Preferred Stocks
(Cost $321,071,839) 348,558,759
--------------------------------------------------------------------------------
See notes to financial statements.
2 | Annual Report | October 31, 2004
AVK | Advent Claymore Convertible Securities and Income Fund | Portfolio of
Investments continued
Principal Amount Value
--------------------------------------------------------------------------------
Corporate Bonds - 49.3%
Aluminum, Steel and Other Metals - 1.5%
$ 2,500,000 Freeport-McMoRan Copper & Gold, Inc., B
10.125%, 2/01/10, Senior Notes $ 2,818,750
3,218,000 Shaw Group, Inc., BB- 10.75%,
3/15/10, Senior Notes 3,451,305
2,615,000 United States Steel LLC, BB-
10.75%, 8/01/08, Senior Notes 3,111,850
--------------------------------------------------------------------------------
9,381,905
--------------------------------------------------------------------------------
Automotive - 0.8%
5,000,000 Dura Operating Corp., Ser. D, B-
9.00%, 5/01/09, Company Guarantee Notes 4,812,500
--------------------------------------------------------------------------------
Chemicals - 3.5%
2,897,000 BCP Caylux Holdings Luxembourg SCA, B-
9.625%, 6/15/14, Senior
Subordinated Notes (a) 3,259,125
10,000,000 Equistar Chemical/Funding, B+
10.125%, 9/01/08, Senior Notes 11,537,500
2,763,000 Huntsman LLC, CCC+
9.32%,7/15/11, Company Guarantee Notes (a)(b) 2,977,133
3,600,000 Lyondell Chemical Co., B-
10.875%, 5/01/09, Senior
Subordinated Notes 3,838,500
--------------------------------------------------------------------------------
21,612,258
--------------------------------------------------------------------------------
Commercial Services - 0.8%
4,809,000 Language Line, Inc., CCC+
11.125%, 6/15/12, Senior Subordinated Notes (a) 5,169,675
--------------------------------------------------------------------------------
Communications Equipment - 0.9%
5,166,000 Superior Essex Communications LLC/Essex Group,
Inc., B 9.00%, 4/15/12, Senior Notes 5,269,320
--------------------------------------------------------------------------------
Communications, Media and Entertainment - 7.8%
7,000,000 Cablevision System Corp., B+
8.00%, 4/15/12, Senior Notes (a) 7,560,000
10,675,000 Mediacom LLC, B
9.50%, 1/15/13, Senior Notes 10,514,875
3,000,000 Rainbow National Services LLC, CCC+
8.75%, 9/01/12, Senior Notes (a) 3,225,000
4,250,000 euros Telenet Communication NV, B-
9.00%, 12/15/13, Senior Notes (a) 5,838,707
7,000,000 Vertis, Inc., Ser. B, B-
10.875%, 6/15/09, Senior Notes 7,665,000
3,522,000 XM Satellite Radio, Inc., CCC+
12.00%, 6/15/10, Senior Secured Notes 4,164,765
8,000,000 Young Broadcasting, Inc., CCC+
10.00%, 3/01/11, Senior Subordinated Notes 8,440,000
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47,408,347
--------------------------------------------------------------------------------
Containers & Packaging - 0.9%
$ 5,287,000 Solo Cup Co., B- 8.50%, 2/15/14,
Senior Subordinated Notes $ 5,220,912
--------------------------------------------------------------------------------
Electronic Equipment and Components - 1.7%
10,000,000 Advanced Micro Devices, Inc., B- 7.75%,
11/01/12, Senior Notes (a) 10,075,000
--------------------------------------------------------------------------------
Financial Services - 3.2%
7,727,000 E*Trade Financial Corp., B+
8.00%, 6/15/11, Senior Notes (a) 8,190,620
7,200,000 Leucadia National Corp., BB
7.00%, 8/15/13, Senior Notes 7,380,000
3,470,000 REFCO Finance Holdings LLC, B
9.00%, 8/01/12, Company Guarantee Notes (a) 3,764,950
--------------------------------------------------------------------------------
19,335,570
--------------------------------------------------------------------------------
Forest Products - 1.0%
6,000,000 Tembec Industries, Inc., BB-
8.50%, 2/01/11, Company Guarantee Notes 6,135,000
--------------------------------------------------------------------------------
Health and Medical Facilities - 0.2%
1,112,000 National Mentor, Inc., B-
9.625%, 12/01/12, Senior Subordinated Notes (a) 1,145,360
--------------------------------------------------------------------------------
Health Care Products and Services - 3.6%
5,000,000 Alliance Imaging, Inc., B-
10.375%, 4/15/11, Senior Subordinated Notes 5,550,000
10,000,000 Encore Medical IHC, Inc., CCC+ 9.75%,
10/01/12, Senior Subordinated Notes (a) 9,850,000
6,000,000 NDCHealth Corp., B
10.50%, 12/01/12, Company Guarantee Notes 6,390,000
--------------------------------------------------------------------------------
21,790,000
--------------------------------------------------------------------------------
Leisure and Entertainment - 0.7%
4,000,000 AMC Entertainment, Inc., CCC+
9.875%, 2/01/12, Senior
Subordinated Notes 4,300,000
--------------------------------------------------------------------------------
Office Equipment - 0.6%
295,000 Danka Business Systems, B+
11.00%, 6/15/10, Senior Notes 311,225
3,500,000 Xerox Capital Trust I, B-
8.00%, 2/01/27, Company Guarantee Notes 3,517,500
--------------------------------------------------------------------------------
3,828,725
--------------------------------------------------------------------------------
Oil and Gas - 3.5%
791,000 Hanover Compressor Co., B
9.00%, 6/01/14, Senior Notes 885,920
9,000,000 Petrobras International Finance Co., NR
9.125%, 7/02/13, Senior Notes 9,855,000
7,000,000 Seitel, Inc., B-
11.75%, 7/15/11, Senior Notes (a) 7,315,000
3,000,000 Williams Cos., Inc., B+
8.125%, 3/15/12, Senior Notes 3,540,000
--------------------------------------------------------------------------------
21,595,920
--------------------------------------------------------------------------------
See notes to financial statements.
Annual Report | October 31, 2004 | 3
AVK | Advent Claymore Convertible Securities and Income Fund | Portfolio of
Investments continued
Principal Amount Value
--------------------------------------------------------------------------------
Corporate Bonds (continued)
Pharmaceuticals - 1.7%
$ 10,000,000 Athena Neurosciences Finance LLC, B-
7.25%, 2/21/08, Senior Notes $ 10,462,500
--------------------------------------------------------------------------------
Printing - 0.3%
1,581,000 Cadmus Communications Corp., B
8.375%, 6/15/14, Senior Subordinated Notes 1,715,385
--------------------------------------------------------------------------------
Publishing - 2.4%
2,940,000 Dex Media West, B 9.875%, 8/15/13,
Senior Subordinated Notes (a) 3,491,250
11,000,000 PRIMEDIA, Inc., B8.00%, 5/15/13,
Senior Notes (a) 11,082,500
--------------------------------------------------------------------------------
14,573,750
--------------------------------------------------------------------------------
Real Estate Investment Trust - 0.7%
2,566,000 American Real Estate Partners
LP/American Real Estate Finance Corp., BB
8.125%, 6/01/12, Senior Notes (a) 2,719,960
1,531,000 Felcor Lodging LP, B- 9.50%, 9/15/08,
Senior Notes 1,615,205
--------------------------------------------------------------------------------
4,335,165
--------------------------------------------------------------------------------
Retail - Specialty Stores - 1.3%
Rite Aid Corp.
3,500,000 9.50%, 2/15/11, Senior Secured Notes, B+ 3,893,750
4,000,000 9.25%, 6/01/13, Senior Notes, B- 4,190,000
--------------------------------------------------------------------------------
8,083,750
--------------------------------------------------------------------------------
Telecommunications - 11.8%
Alamosa Delaware, Inc.
3,298,000 11.00% 7/31/10, Senior Notes, CCC 3,875,150
2,000,000 8.50%, 1/31/12, Senior Notes, CCC 2,130,000
--------------------------------------------------------------------------------
Centennial Cellular Co.
2,000,000 10.125%, 6/15/13, Company Guarantee
Notes, CCC (a) 2,180,000
5,673,000 10.125%, 6/15/13, Company Guarantee
Notes, CCC 6,183,570
7,500,000 Crown Castle International Corp.,
CCC 10.75%, 8/01/11, Senior Notes 8,343,750
4,000,000 Dobson Cellular Systems, CCC 9.875%,
11/01/12, Secured Notes (a) 4,000,000
6,000,000 Fairpoint Communication, Inc., B-
12.50%, 5/01/10, Senior Subordinated Notes 6,450,000
8,158,000 Madison River Capital, CCC+ 13.25%,
3/01/10, Senior Notes 8,729,060
10,000,000 MCI, Inc., NR 7.735%, 5/01/14, Senior Notes 9,662,500
2,240,000 PanAmSat Corp., B+ 9.00%, 8/15/14,
Company Guarantee Notes (a) 2,385,600
5,420,000 Rural Cellular Corp., B- 8.25%, 3/15/12,
Senior Secured Notes (a) 5,718,100
10,000,000 Qwest Corp., BB- 7.875%, 9/01/11,
Senior Notes (a) 10,700,000
1,385,000 US Unwired, Inc., Ser. B, CCC- 10.00%,
6/15/12, Secured Notes 1,506,187
--------------------------------------------------------------------------------
71,863,917
--------------------------------------------------------------------------------
Utilities - Gas and Electric - 0.4%
$ 2,000,000 Sierra Pacific Resources, B- 8.625%,
3/15/14, Senior Notes $ 2,280,000
--------------------------------------------------------------------------------
Total Corporate Bonds
(Cost $283,377,880) 300,394,959
--------------------------------------------------------------------------------
Convertible Bonds - 30.7%
Airlines - 0.5%
3,000,000 ExpressJet Holdings, Inc., NR
4.25%, 8/01/23, Senior Convertible Notes 2,880,000
--------------------------------------------------------------------------------
Aluminum, Steel and Other Metals - 1.2%
Freeport-McMoRan Copper & Gold, Inc.
3,112,000 7.00%, 2/11/11, Senior Convertible Notes, B 4,524,070
2,000,000 7.00%, 2/11/11, Senior Convertible
Notes, B (a) 2,907,500
--------------------------------------------------------------------------------
7,431,570
--------------------------------------------------------------------------------
Automotive - 2.3%
600,000 General Motors Corp, Ser. B, BBB- 5.25%,
3/06/32, Senior Unsecured Convertible
Debentures 13,986,000
--------------------------------------------------------------------------------
Biotechnology - 0.9%
5,783,000 Cubist Pharmaceuticals, NR
5.50%, 11/01/08, Subordinated
Convertible Notes 5,363,733
--------------------------------------------------------------------------------
Commercial Services - 1.6%
5,000,000 The BISYS Group, Inc., NR
4.00%, 3/15/06, Convertible Notes 4,925,000
5,000,000 Quanta Services, Inc., B
4.50%, 10/01/23, Subordinated Debentures 5,181,250
--------------------------------------------------------------------------------
10,106,250
--------------------------------------------------------------------------------
Communications Equipment - 1.8%
10,175,000 Lucent Technologies, Inc., CCC+
8.00%, 8/01/31, Convertible Notes 11,306,969
--------------------------------------------------------------------------------
Communications, Media and Entertainment - 3.7%
15,428,000 Echostar Communications Corp., B 5.75%,
5/15/08, Subordinated Convertible Notes 15,871,555
6,830,000 Charter Communications, Inc., CCC- 5.75%,
10/15/05, Senior Unsecured Convertible
Debentures 6,454,350
--------------------------------------------------------------------------------
22,325,905
--------------------------------------------------------------------------------
Computers - Software and Peripherals - 2.1%
8,166,000 Mercury Interactive Corp., NR
4.75%, 7/01/07, Convertible Notes 8,135,378
--------------------------------------------------------------------------------
Quantum Corp., B
5,000,000 4.375%, 8/01/10, Subordinated
Convertible Notes 4,768,750
--------------------------------------------------------------------------------
12,904,128
--------------------------------------------------------------------------------
E-Commerce - 2.1%
13,066,000 Amazon.com, Inc., B- 4.75%, 2/01/09,
Senior Subordinated Convertible Debentures 13,147,662
--------------------------------------------------------------------------------
See notes to financial statements.
4 | Annual Report | October 31, 2004
AVK | Advent Claymore Convertible Securities and Income Fund | Portfolio of
Investments continued
Principal Amount Value
-------------------------------------------------------------------------------
Electronic Equipment and Components - 4.5%
$ 10,589,000 Agere Systems, Inc., B $ 10,919,906
6.50%, 12/15/09, Subordinated
Convertible Notes
7,800,000 ASM Lithography, NR
5.75%, 10/15/06, Subordinated
Convertible Notes 8,708,700
8,000,000 Fairchild Semiconductor
International, Inc., B
5.00%, 11/01/08, Company Guarantee Notes 8,040,000
-------------------------------------------------------------------------------
27,668,606
-------------------------------------------------------------------------------
Financial Services - 3.8%
4,847,000 E*TRADE Group, B-
6.00%, 2/01/07, Subordinated
Convertible Notes 4,980,293
7,710,000 IOS Capital LLC, B+
5.00%, 5/10/07, Subordinated
Convertible Notes (a) 7,922,025
10,000,000 Merrill Lynch & Co., Inc., A+
6.50%, 8/31/06, Convertible Notes (a) 10,116,556
-------------------------------------------------------------------------------
23,018,874
-------------------------------------------------------------------------------
Health and Medical Facilities - 1.9%
11,472,000 Lifepoint Hospitals Holdings, Inc., NR
4.50%, 6/01/09, Subordinated
Convertible Notes 11,414,640
-------------------------------------------------------------------------------
Health Care Products and Services - 1.1%
7,000,000 Enzon, Inc., NR
4.50%, 7/01/08, Subordinated
Convertible Notes 6,623,750
-------------------------------------------------------------------------------
Retail - Department Stores - 1.0%
5,000,000 J.C.Penney Co., Inc., BB-
5.00%, 10/15/08, Subordinated
Convertible Notes 6,112,500
-------------------------------------------------------------------------------
Telecommunications - 1.5%
8,700,000 Nextel Communications, Inc., BB
5.25%, 1/15/10, Senior
Convertible Notes 8,906,625
-------------------------------------------------------------------------------
Transportation - 0.7%
4,500,000 CP Ships Ltd., BB+
4.00%, 6/24/09, Senior
Subordinated Convertible Notes (a) 4,235,625
-------------------------------------------------------------------------------
Total Convertible Bonds
(Cost $180,421,573) 187,432,837
-------------------------------------------------------------------------------
Total Long-Term Investments
(Cost $784,871,292) 836,386,555
-------------------------------------------------------------------------------
Short-Term Investments - 8.0%
30,000,000 Dreyfus Treasury $ 30,000,000
18,893,920 Goldman Sachs Financial Prime Obligations 18,893,920
-------------------------------------------------------------------------------
(Cost $48,893,920) 48,893,920
-------------------------------------------------------------------------------
Total Investments
(Cost $833,765,212) - 145.2% 885,280,475
Liabilities in excess of other assets - (0.1%) (825,244)
Preferred Stock, at redemption value - (-45.1%
of Net Assets Applicable to Common
Shareholders or -31.1% of Total Investments) (275,000,000)
-------------------------------------------------------------------------------
Net Assets Applicable to Common
Shareholders - 100.0% $ 609,455,231
-------------------------------------------------------------------------------
(a) Securities are exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers. At
October 31, 2004 these securities amounted to $135,829,686 or 22.3% of
net assets.
(b) Floating rate security.
Ratings shown are per Standard & Poor's and are unaudited. Securities
classified as NR are not rated by Standard & Poor's. All percentages
shown in the portfolio of investments are based on net assets applicable
to Common Shareholders unless otherwise noted.
See notes to financial statements.
Annual Report | October 31, 2004 | 5
AVK | Advent Claymore Convertible Securities and Income Fund
October 31, 2004
Assets
Investments in securities, at value (cost $833,765,212) $ 885,280,475
Cash 2,288,803
Receivable for securities sold 55,027,823
Interest receivable 9,686,100
Dividends receivable 2,895,177
Other assets 41,845
--------------------------------------------------------------------------------
Total assets 955,220,223
--------------------------------------------------------------------------------
Liabilities
Payable for securities purchased 69,403,654
Net unrealized depreciation on interest rate swaps 429,338
Advisory fee payable 317,871
Dividends payable - preferred shares 131,081
Servicing fee payable 93,491
Offering costs payable 77,709
Accrued expenses and other liabilities 311,848
--------------------------------------------------------------------------------
Total liabilities 70,764,992
--------------------------------------------------------------------------------
Preferred Stock, at redemption value
$.001 par value per share, 11,000 Auction Market
Preferred Shares authorized, issued and outstanding
at $25,000 per share liquidation preference 275,000,000
--------------------------------------------------------------------------------
Net Assets Applicable to Common Shareholders $ 609,455,231
--------------------------------------------------------------------------------
Composition of Net Assets Applicable to Common Shareholders
Common Stock, $.001 par value per share;
Unlimited number of shares authorized, 23,352,574
shares issued and outstanding $ 23,353
Additional paid-in capital 553,061,848
Undistributed net investment income 9,974,419
Accumulated net realized loss on investments,
interest rate swaps and foreign currency transactions (4,695,852)
Accumulated net unrealized appreciation on
investments, interest rate swaps and foreign
Currency translation 51,091,463
--------------------------------------------------------------------------------
Net Assets Applicable to Common Shareholders $ 609,455,231
--------------------------------------------------------------------------------
Net Assets Value Applicable to common Shareholders
(based on 23,352,574 common shares outstanding) $ 26.10
--------------------------------------------------------------------------------
See notes to financial statements.
6 | Annual Report | October 31, 2004
AVK | Advent Claymore Convertible Securities and Income Fund
For the Year Ended October 31, 2004
Investment Income
Interest (net of foreign $ 37,398,206
withholding taxes of $13,954)
Dividends 25,416,143
----------------------------------------------------------------------------
Total income $ 62,814,349
----------------------------------------------------------------------------
Expenses
Advisory fee 4,717,268
Servicing agent fee 1,834,493
Auction agent fee - preferred stock 669,816
Fund accounting 143,436
Administration fee 142,388
Audit 108,633
Transfer agent 108,627
Printing 108,461
Custodian 103,863
Insurance 82,946
Trustees 65,239
Legal 57,028
NYSE listing 39,041
Rating agency fee 34,388
ICI dues 28,280
Miscellaneous 25,800
----------------------------------------------------------------------------
Total expenses 8,269,707
Advisory and Servicing agent fees waived (1,747,136)
----------------------------------------------------------------------------
Net expenses 6,522,571
----------------------------------------------------------------------------
Net investment income 56,291,778
----------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on
Investments, Interest Rate Swaps and
Foreign Currency Transactions:
Net realized gain (loss) on:
Investments 3,247,557
Interest rate swaps 114,046
Foreign currency transactions (296,236)
Net change in unrealized appreciation
(depreciation) on:
Investments (764,823)
Interest rate swaps (429,338)
Foreign Currency translation 5,538
----------------------------------------------------------------------------
Net gain on investments, interest
rate swaps and foreign currency transactions 1,876,744
----------------------------------------------------------------------------
Dividends to Auction Preferred
Shareholders from
Net investment income (3,556,968)
----------------------------------------------------------------------------
Net increase in Net Assets Applicable to Common
Shareholders Resulting from Operations $ 54,611,554
----------------------------------------------------------------------------
See notes to financial statements.
Annual Report | October 31, 2004 | 7
AVK | Advent Claymore Convertible Securities and Income Fund
For the Period
For the April 30, 2003*
Year Ended through
October 31, 2004 October 31, 2003
------------------------------------------------------------------------------------------
Increase in Net Assets Applicable to Common
Shareholders Resulting from Operations:
Net investment income $ 56,291,778 $ 21,594,134
Net realized gain on investments, interest rate
swaps and foreign currency transactions 3,065,367 3,115,360
Net change in unrealized appreciation
(depreciation) on investments, interest rate
swaps and foreign currency translation (1,188,623) 52,280,086
Dividends to Auction Preferred Shareholders from:
Net investment income (3,556,968) (674,649)
------------------------------------------------------------------------------------------
Net increase in net assets applicable to Common
Shareholders resulting from operations 54,611,554 76,314,931
------------------------------------------------------------------------------------------
Dividends and Distributions to Common
Shareholders from:
Net investment income (50,250,068) (20,051,548)
Net realized gain on investments (4,254,839) -
------------------------------------------------------------------------------------------
(54,504,907) (20,051,548)
------------------------------------------------------------------------------------------
Capital Share Transactions:
Net proceeds from the issuance of Common Shares - 554,137,491
Reinvestment of dividends - 1,185,923
Common and preferred shares' offering and
organization expenses charged to paid-in-capital
in excess of par value (1,066,352) (1,271,861)
------------------------------------------------------------------------------------------
Net increase (decrease) from capital share
transactions (1,066,352) 554,051,553
------------------------------------------------------------------------------------------
Total increase (decrease) (959,705) 610,314,936
Net Assets Applicable to Common Shareholders
Beginning of period 610,414,936 100,000
------------------------------------------------------------------------------------------
End of period (including undistributed net
investment income of $9,974,419 in 2004 and
$785,167 in 2003, respectively) $ 609,455,231 $ 610,414,936
------------------------------------------------------------------------------------------
* Commencement of operations.
See notes to financial statements.
8 | Annual Report | October 31, 2004
AVK | Advent Claymore Convertible Securities and Income Fund
For the Period
For the April 30, 2003/(a)/
Per share operating performance for a share Year Ended through
of common stock outstanding throughout the period October 31,2004 October 31,2003
-------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 26.14/(b)/ $ 23.88/(b)/
-------------------------------------------------------------------------------------------
Income from investment operations
Net investment income 2.41 0.93
Net realized and unrealized gain on
investments, interest rate swaps and foreign
currency transactions 0.08 2.28
Dividends to preferred shareholders from net
investment income (common stock equivalent basis) (0.15) (0.03)
-------------------------------------------------------------------------------------------
Total from investment operations 2.34 3.18
-------------------------------------------------------------------------------------------
Common and preferred shares' offering and
organization expenses charged to
paid-in-capital in excess of par value (0.05) (0.06)
-------------------------------------------------------------------------------------------
Dividends and distributions to Common
Shareholders
Net investment income (2.15) (0.86)
Net realized gain (0.18) -
-------------------------------------------------------------------------------------------
Total dividends and distributions to Common
Shareholders (2.33) (0.86)
-------------------------------------------------------------------------------------------
Net asset value, end of period $ 26.10 $ 26.14
-------------------------------------------------------------------------------------------
Market value, end of period $ 25.41 $ 24.95
-------------------------------------------------------------------------------------------
Total investment return/(c)/
Net asset value 8.93% 13.29%
Market value 11.44% 3.40%
Ratios and supplemental data
Net assets, applicable to Common
Shareholders, end of period (thousands) $ 609,455 $ 610,415
Preferred shares, at redemption value,
($25,000 per share liquidation preference)
(thousands) $ 275,000 $ 215,000
Preferred shares asset coverage per share $ 80,405 $ 95,978
Ratios to Average Net Assets applicable to
Common Shares:/(d)(e)/
Net Expenses, after fee waiver 1.05% 0.88%
Net Expenses, before fee waiver 1.33% 1.12%
Net Investment Income, after fee waiver,
prior to effect of dividends to preferred share 9.07% 7.51%
Net Investment Income, before fee waiver,
prior to effect of dividends to preferred share 8.79% 7.27%
Net Investment Income, after fee waiver,
after effect of dividends to preferred share 8.49% 7.28%
Net Investment Income, before fee waiver,
after effect of dividends to preferred share 8.21% 7.04%
Ratios to Average Managed Assets:/(d)(f)/
Net Expenses, after few waiver 0.75% 0.73%
Net Expenses, before fee waiver 0.95% 0.93%
Net Investment Income, after fee waiver,
prior to effect of dividends to preferred share 6.44% 6.27%
Net Investment Income, before fee waiver,
prior to effect of dividends to preferred share 6.24% 6.07%
Portfolio turnover rate 112% 34%
(a) Commencement of operations.
(b) Before reimbursement of offering expenses charged to capital during the
period.
(c) Total investment return is calculated assuming a purchase of a common share
at the beginning of the period and a sale on the last day of the period
reported either at net asset value ("NAV") or market price per share.
Dividends and distributions are assumed to be reinvested at NAV returns or
the prices obtained under the Fund's Dividend Reinvestment Plan for market
value returns. Total investment return does not reflect brokerage
commissions. A return calculated for a period of less than one year is not
annualized.
(d) Annualized.
(e) The October 31, 2003 annual report incorrectly characterized the ratios to
Managed Assets as ratios to Average Net Assets applicable to Common Shares.
The above presentation correctly characterizes these ratios.
(f) Managed assets is equal to net assets applicable to Common Shareholders
plus outstanding leverage such as the liquidation value of preferred
shares.
See notes to financial statements.
Annual Report | October 31, 2004 | 9
AVK | Advent Claymore Convertible Securities and Income Fund
October 31, 2004
Note 1 - Organization:
Advent Claymore Convertible Securities and Income Fund (the "Fund") was
organized as a Delaware statutory trust on February 19, 2003. The Fund is
registered as a diversified, closed-end management investment company under the
Investment Company Act of 1940, as amended.
Note 2 - Accounting Policies:
The preparation of the financial statements in accordance with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
and disclosures in the financial statements. Actual results could differ from
these estimates. In the normal course of business, the Fund enters into
contracts that contain a variety of representations, which provide general
indemnifications. The Fund's maximum exposure under these arrangements is
unknown, as this would involve future claims that may be made against the Fund
that have not yet occurred. However, the Fund expects the risk of loss to be
remote.
The following is a summary of significant accounting policies followed by the
Fund.
(a)Valuation of Investments
Readily marketable portfolio securities listed on an exchange or trading on the
National Association of Securities Dealers Automated Quotations, Inc. ("NASDAQ")
National List are generally valued at their last sale price on the business day
as of which such value is being determined. If no sales are reported, the
securities are valued at the mean of the closing bid and asked prices on such
day. If no bid or asked prices are quoted on such day, then the security is
valued by such method as the Fund's Board of Trustees shall determine in good
faith to reflect its fair market value. Portfolio securities traded on more than
one securities exchange are valued based upon the price from the exchange
representing the principal market for such securities.
Readily marketable securities traded in the over-the-counter market, including
listed securities whose primary market is believed by the Advisor to be
over-the-counter, but excluding securities admitted to trading on the NASDAQ
national list, are valued at the mean of the current bid and asked prices.
However, substantially all fixed-income securities may be valued on the basis of
prices provided by a pricing service when such prices are believed by the
Trustees to reflect the fair value of such securities.
Short-term debt securities having a remaining maturity of sixty days or less are
valued at amortized cost or amortized value, which approximates market value.
(b) Investment Transactions and Investment Income
Investment transactions are accounted for on the trade date. Realized gains and
losses on investments are determined on the identified cost basis. Dividend
income is recorded on the ex-dividend date and interest income is recorded on an
accrual basis. Discounts or premiums on debt securities purchased are accreted
or amortized to interest income over the lives of the respective securities
using the effective interest method.
(c) Currency Translation
Assets and liabilities denominated in foreign currencies are translated into
U.S. dollars at the mean of the bid and asked price of respective exchange rates
on the last day of the period. Purchases and sales of investments denominated in
foreign currencies are translated at the exchange rate on the date of the
transaction.
Foreign exchange gain or loss resulting from the sale of an investment, holding
of a foreign currency, expiration of a currency exchange contract, difference in
exchange rates between the trade date and settlement date of an investment
purchased or sold, and the difference between dividends actually received
compared to the amount shown in a Fund's accounting records on the date of
receipt are shown as net realized gains or losses on foreign currency
translations in the respective Fund's statement of operations.
Foreign exchange gain or loss on assets and liabilities, other than investments,
are shown as unrealized appreciation (depreciation) on foreign currency
translations.
(d) Swaps
The Fund may enter into swap agreements to manage its exposure to interest rates
and/or credit risk. A swap is an agreement to exchange the return generated by
one instrument for the return generated by another instrument. Interest rate
swap agreements involve the exchange by the Fund with another party of their
respective commitments to pay or receive interest. The swaps are valued weekly
at current market value and any unrealized gain or loss is included in the
Statement of Assets and Liabilities. Gain or loss is realized on the termination
date of the swap and is equal to the difference between the Fund's basis in the
swap and the proceeds of the closing transaction, including any fees. During the
period that the swap agreement is open, the Fund may be subject to risk from the
potential inability of the counterparty to meet the terms of the agreement. The
swaps involve elements of both market and credit risk in excess of the amounts
reflected on the Statements of Assets and Liabilities.
Realized gain (loss) upon termination of swap contracts is recorded on the
Statement of Operations. Fluctuations in the value of swap contracts are
recorded as a component of net change in unrealized appreciation (depreciation)
of swap contracts. Net periodic payments received by the Fund are included as
part of realized gains (losses) and/or unrealized appreciation (depreciation) on
the Statement of Operations.
(e) Securities Lending
The Fund may lend its securities to broker-dealers and financial institutions.
The loans are collateralized by cash or securities at least equal at all times
to the market value of the securities loaned. The Fund may bear the risk of
delay in recovery of, or loss of rights in, the securities loaned should the
borrower of the securities experience financial difficulty. The Fund receives
compensation for lending its securities in the form of fees or it retains a
portion of interest on the investment of any cash received as collateral. The
Fund also continues to receive interest and dividends on the securities loaned,
and any gain or loss in the market price of the securities loaned that may occur
during the term of the loan will be for the account of the Fund.
10 | Annual Report | October 31, 2004
AVK | Advent Claymore Convertible Securities and Income Fund | Notes to
Financial Statements continued
(f) Concentration of Risk
It is the Fund's policy to invest a significant portion of its assets in
convertible securities. Although convertible securities do derive part of their
value from that of the securities into which they are convertible, they are not
considered derivative financial instruments. However, certain of the Fund's
investment include features which render them more sensitive to price changes in
their underlying securities. Consequently, this exposes the Fund to greater
downside risk than traditional convertible securities, but still less than that
of the underlying common stock.
Note 3 - Investment Management Agreement, Servicing Agreement and Other
Agreements:
Pursuant to the Investment Management Agreement (the "Agreement") between the
Fund and the Advisor, the Advisor is responsible for the daily management of the
Fund's portfolio of investments, which includes buying and selling securities
for the Fund, as well as investment research. The Advisor will receive an annual
fee from the Fund based on the average value of the Fund's Managed Assets which
includes the amount from the issuance of the Preferred Shares. In addition,
subject to the approval of the Fund's Board of Trustees, a pro rata portion of
the salaries, bonuses, health insurance, retirement benefits and similar
employment costs for the time spent on Fund operations (other than the provision
of services required under the Agreement) of all personnel employed by the
Advisor who devote substantial time to Fund operations may be reimbursed by the
Fund to the Advisor. For the year ended October 31, 2004, no one has been
reimbursed by the Fund. The annual fee will be determined as follows:
(a) If the average of the Fund's Managed Assets (calculated monthly) is greater
than $250 million, the fee will be a maximum amount equal to 0.54% of the
average value of the Fund's Managed Assets. In addition, the Advisor has
voluntarily agreed to waive receipt of a portion of the management fee or
other expenses of the Fund in the amount of 0.115% of the average values of
the Managed Assets for the first five years of the Fund's operations and
for a declining amount for an additional three years.
(b) If the average value of the Fund's Managed Assets (calculated monthly) is
$250 million or less, the fee will be a maximum amount equal to 0.55% of
the average value of the Fund's Managed Assets. In addition, the Advisor
has voluntarily agreed to waive receipt of a portion of the management fee
or other expenses of the Fund in the amount of 0.025% of the average values
of the Managed Assets for the first five years of the Fund's operations,
after which the Advisor anticipates that it will not waive any portion of
the management fee.
Pursuant to a Servicing Agreement, the Servicing Agent will act as servicing
agent to the Fund. The Servicing Agent will receive an annual fee from the Fund,
which will be based on the average value of the Fund's Managed Assets. The fee
will be determined as follows:
(a) If the average value of the Fund's Managed Assets (calculated monthly) is
greater than $250 million, the fee will be a maximum amount equal to 0.21%
of the average value of the Fund's Managed Assets. In addition, the
Servicing Agent has voluntarily agreed to waive receipt of a portion of the
servicing fee of the Fund in the amount of 0.085% of the average values of
the Managed Assets for the first five years of the Fund's operations and
for a declining amount for an additional three years.
(b) If the average value of the Fund's Managed Assets (calculated monthly) is
$250 million or less, the fee will be a maximum amount equal to 0.20% of
the average value of the Fund's Managed Assets. In addition, the Servicing
Agent has Voluntarily agreed to waive receipt of a portion of the servicing
fee of the Fund in the amount of 0.175% of the average values of the
Managed Assets for the first five years of the Fund's operations and for a
declining amount for an additional three years.
The fee waivers of the Advisor and the Servicing Agent are contractual
commitments of more than one year.
The Bank of New York ("BNY") acts as the Fund's custodian, administrator and
transfer agent. As custodian, BNY is responsible for the custody of the Fund's
assets. As administrator, BNY is responsible for maintaining the books and
records of the Fund's securities and cash. As transfer agent, BNY is responsible
for performing transfer agency services for the Fund.
Note 4 - Federal Income Taxes:
The Fund intends to comply with the requirements of the Internal Revenue Code of
1986, as amended, applicable to regulated investment companies. Accordingly, no
provision for U.S. federal income taxes is required. In addition, by
distributing substantially all of its ordinary income and long-term capital
gains, if any, during each calendar year, the Fund intends not to be subject to
U.S. federal excise tax.
In order to present paid-in capital in excess of par and accumulated net
realized gains or losses on the Statement of Assets and Liabilities that more
closely represent their tax character, certain adjustments have been made to
undistributed net investment income and accumulated net realized gains or losses
on investments. For the year ended October 31, 2004, the adjustments were to
decrease accumulated net realized gain on investments by $6,704,510 and increase
undistributed net investment income by $6,704,510 due to the difference in the
treatment for book and tax purposes of certain investments.
At October 31, 2004, the cost and related gross unrealized appreciation and
depreciation for tax purposes are as follows:
Net tax
Net tax unrealized
unrealized appreciation/ Undistributed Undistributed
Cost of appreciation/ (depreciation) ordinary long-term
investments Gross tax Gross tax (depreciation) on derivatives income/ gains/
for tax unrealized unrealized on and foreign (accumulated (accumulated
purposes appreciation depreciation investments currency ordinary loss) capital loss)
-------------------------------------------------------------------------------------------------------------
$ 835,976,409 $ 52,139,378 $ (2,835,312) $ 49,304,066 $ (423,800) $ 10,585,189 $ (3,095,426)
The differences between book basis and tax basis unrealized
appreciation/(depreciation) is attributable to the tax deferral of losses on
wash sales and additional income accrued for tax purposes on the convertible
preferred stock.
Annual Report | October 31, 2004 | 11
AVK | Advent Claymore Convertible Securities and Income Fund | Notes to
Financial Statements continued
For the year ended October 31, 2004 and the period ended October 31, 2003, the
tax character of distributions paid, as reflected in the statement of changes in
net assets, of $58,061,875 and $20,726,197, respectively, was ordinary income.
For federal income tax purposes, the Fund has a capital loss carryforward of
$3,095,426, which expires October 31, 2012. Capital loss carryforwards are
available to offset future capital gains, if any.
Note 5 - Investments in Securities:
For the year ended October 31, 2004, purchases and sales of investments, other
than short-term securities, were $974,059,324 and $950,934,019, respectively.
The Fund entered into interest rate swap agreements during the year ended
October 31, 2004. Details of the swap agreements outstanding as of October 31,
2004 were as follows:
Notional Unrealized
Termination Amount Fixed Floating Appreciation
Counterparty Date (000) Rate Rate (Depreciation)
------------------------------------------------------------------------------------------
JP Morgan Chase & Co. 01/10/2005 $ 30,000 1.47% 3 Month LIBOR $ (67,368)
JP Morgan Chase & Co. 04/19/2005 30,000 1.66% 3 Month LIBOR 84,532
JP Morgan Chase & Co. 07/11/2005 30,000 2.27% 3 Month LIBOR (164,972)
JP Morgan Chase & Co. 01/09/2006 30,000 2.16% 3 Month LIBOR (31,009)
JP Morgan Chase & Co. 04/19/2006 30,000 2.42% 3 Month LIBOR 98,253
JP Morgan Chase & Co. 07/10/2006 30,000 2.96% 3 Month LIBOR (348,774)
$ (429,338)
For each swap noted, the Fund pays a fixed rate and receives a floating rate.
Note 6 - Capital:
Common Shares
The Fund has an unlimited amount of common shares, $0.001 par value, authorized
and 23,352,574 issued and outstanding. Of this amount, the Fund issued
20,800,000 shares of common stock, in its initial public offering and issued,
pursuant to an over allotment option to the underwriters, an additional
1,000,000 shares on May 16, 2003, 1,000,000 shares on June 9, 2003, and 500,000
shares on June 17, 2003. All of these shares were issued at $23.875 per share
before a reimbursement of expenses to the underwriters of $0.0083 per share. In
connection with the Fund's dividend reinvestment plan, the Fund did not issue
any shares during the year ended October 31, 2004.
Offering expenses in connection with the issuance of the common shares of
$1,165,200 have been borne by the Fund and have been charged against additional
paid-in-capital. Advent Capital Management, LLC, the Fund's investment advisor
(the "Advisor"), and Claymore Securities, Inc., the Fund's servicing agent (the
"Servicing Agent"), have agreed to pay offering expenses (other than the sales
load, but including the reimbursement of expenses to the underwriters) in excess
of $0.5 per common share, or approximately $1,165,200. The Advisor and the
Servicing Agent have also agreed to pay the Fund's organizational expenses of
approximately $35,000.
Preferred Shares
On June 19, 2003, the Fund's Board of Trustees authorized the issuance of
preferred shares, as part of the Fund's leverage strategy. Preferred shares
issued by the Fund have seniority over the common shares.
On July 24, 2003, the Fund issued 2,150 shares of Preferred Shares Series M7,
2,150 shares of Preferred Shares Series T28, 2,150 shares of Preferred Shares
Series W7 and 2,150 shares of Preferred Shares Series TH28 each with a
liquidation value of $25,000 per share plus accrued dividends. In addition, on
March 16, 2004, the Fund issued 1,200 shares of Preferred Shares Series F7 and
1,200 shares of Preferred Shares Series W28 each with a liquidation value of
$25,000 per share plus accrued dividends.
Dividends are accumulated daily at a rate set through an auction process.
Distributions of net realized capital gains, if any, are made annually.
Offering costs associated with the issuance of the preferred shares totaling
$1,066,352 have been charged against the common share additional paid-in
capital.
For the year ended October 31, 2004, the annualized dividend rates range from:
High Low At 10/31/04
----------------------------------------
Series M7 1.90% 1.06% 1.85%
Series T28 1.95% 1.10% 1.95%
Series W7 1.93% 1.05% 1.87%
Series W28 1.95% 1.10% 1.90%
Series TH28 1.95% 1.08% 1.95%
Series F7 1.93% 1.05% 1.85%
The Fund is subject to certain limitations and restrictions while Preferred
Shares are outstanding. Failure to comply with these limitations and
restrictions could preclude the Fund from declaring any dividends or
distributions to common shareholders or repurchasing common shares and/or could
trigger the mandatory redemption of Preferred Shares at their liquidation value.
Preferred Shares, which are entitled to one vote per share, generally vote with
the common stock but vote separately as a class to elect two Trustees and on any
matters affecting the rights of the Preferred Shares.
Note 7 - Subsequent Event:
Subsequent to October 31, 2004, the Fund declared on November 1 and December 1,
monthly dividends of $0.1718 per common share. These dividends are payable on
November 30 and December 31 to shareholders of record on November 15 and
December 15, respectively.
12 | Annual Report | October 31, 2004
AVK | Advent Claymore Convertible Securities and Income Fund
To the Shareholders and Board of Trustees of Advent Claymore Convertible
Securities and Income Fund
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets applicable to common shareholders and the financial
highlights (after the adjustment described in Note e to the financial
highlights) present fairly in all material respects, the financial position of
Advent Claymore Convertible Securities and Income Fund, (the "Fund") at October
31, 2004, the results of its operations for the year then ended and the changes
in its net assets applicable to common shareholders and the financial highlights
for the year then ended and for the period April 30, 2003 (commencement of
operations) through October 31, 2003, in conformity with accounting principles
generally accepted in the United States of America. These financial statements
and financial highlights (hereafter referred to as "financial statements") are
the responsibility of the Fund's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at October 31, 2004 by correspondence with the
custodian and brokers, provide a reasonable basis for our opinion.
PRICEWATERHOUSECOOPERS LLP
NEW YORK, NEW YORK
December 14, 2004
Annual Report | October 31, 2004 | 13
AVK | Advent Claymore Convertible Securities and Income Fund | Notes to
Financial Statements continued
Federal Income Tax Information
Qualified dividend income of as much as $841,564 was received by the Fund
through October 31, 2004. The Fund intends to designate the maximum amount of
dividends that qualify for the reduced tax rate pursuant to the Jobs and Growth
Tax Relief Reconciliation Act of 2003.
For corporate shareholders, $1,836,405 of investment income (dividend income
plus short-term gains, if any) qualifies for the dividends-received deduction.
In January 2005, you will be advised on IRS Form 1099 DIV or substitute 1099 DIV
as to the federal tax status of the distributions received by you in the
calendar year 2004.
Results of Shareholder Votes
The Annual Meeting of the Shareholders of the Trust was held on October 28,
2004, where shareholders voted on the election of trustees.
(1) With regards to the election of the following trustees by the shareholders
of the Trust:
Affirmative Withhold
---------------------------------------------
Gerald L. Seizert 22,255,570 339,292
Ronald E. Toupin, Jr. 22,233,609 361,253
Derek Medina 22,228,867 365,955
The other trustees of the Trust whose terms did not expire in 2004 are Tracy V.
Maitland, Nicholas Dalmaso, Ronald A. Nyberg and Michael A. Smart.
14 | Annual Report | October 31, 2004
AVK | Advent Claymore Convertible Securities and Income Fund
Trustees
The trustees of the Advent Claymore Convertible Securities and Income Fund and
their principal occupations during the past five years:
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Name, Address, Age Term of Office Principal Occupation during Other Directorships
and Position(s) held and Length of the Past Five Years and Held by
with Registrant Time Served Other Affiliations Trustee
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Independent Trustees:
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Derek Medina 3 years/since inception Vice President, Business Affairs and Director of Young Scholar's
ABC News News Planning at ABC News from Institute. Former Director of
47 West 66th Street 2003-present. Formerly, Executive Episcopal Social Services.
New York, NY 10023 Director, Office of the President
Age: 37 at ABC News from (2000-2003).
Trustee Former Associate at Cleary Gottlieb
Steen & Hamilton (law firm) (1995-1998).
Former associate in Corporate Finance at
J.P.Morgan/Morgan Guaranty (1988-1990).
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Ronald A. Nyberg 3 years/since inception Principal of Ronald A. Nyberg, Ltd., Trustee, MBIA Capital/Claymore
200 East 5th Avenue a law firm specializing in corporate law, Managed Duration Investment
Suite 116 estate planning and business transactions Grade Municipal Fund; Western
Naperville, IL 60563 from 2000-present. Formerly, Executive Asset/Claymore U.S. Treasury
Age: 51 Vice President, General Counsel and Inflation Protected Securities
Trustee Corporate Secretary of Van Kampen Fund; Western Asset/Claymore
Investments (1982-1999). Former U.S.Treasury Protected
associate of Querrey & Harrow, a law Securities Fund 2;
firm (1978-1982). Dreman/Claymore Dividend &
Income Fund; TS&W/Claymore
Tax-Advantaged Balanced Fund;
and Madison/Claymore Covered
Call Fund.
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Gerald L. Seizert, CFP 3 years/since inception Chief Executive Officer of Seizert Former Director of Loomis,
Seizert Capital Partners, Capital Partners, LLC, where he directs Sayles and Co., L.P.
LLC the equity disciplines of the firm and
1668 S. Telegraph serves as a co-manager of the firm's
Suite 120 hedge fund, Proper Associates, LLC from
Bloomfield Hills, MI 48302 2000-present. Formerly, Co-Chief
Age: 52 Executive (1998-1999) and a Managing
Trustee Partner and Chief Investment
Officer-Equities of Munder Capital
Management, LLC (1995-1999). Former
Vice President and Portfolio Manager
of Loomis, Sayles & Co., L.P.
(asset manager)(1984-1995). Former Vice
President and Portfolio Manager at
First of America Bank (1978-1984).
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Ronald E. Toupin, Jr. 3 years/since inception Formerly, Vice President, Manager and Trustee, MBIA Capital/Claymore
117 Ashland Avenue Portfolio Manager of Nuveen Asset Managed Duration Investment
River Forest, II 60305 Management (1998-1999), Vice Grade Municipal Fund; Western
Age: 46 President of Nuveen Investment Advisory Asset/Claymore U.S. Treasury
Trustee Corporation (1992-1999), Vice President Inflation Protected Securities
and Manager of Nuveen Unit Investment Fund; Western Asset/Claymore
Trusts (1991-1999), and Assistant U.S.Treasury Inflation Protected
Vice President and Portfolio Manager of Securities Fund 2;
Nuveen Unit Trusts (1988-1999), each of Dreman/Claymore Dividend &
John Nuveen & Company, Inc. (asset Income Fund; TS&W/Claymore
manager)(1982-1999). Tax-Advantaged Balance Fund; and
Madison/Claymore Covered
Call Fund.
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Michael A. Smart 3 years/since inception Managing Partner, Williams Capital Director, Country Pure Foods.
Williams Capital Partners, Partners, L.P. Advisor to First Atlantic
L.P. Capital Ltd., equity firm (2001-present).
650 Fifth Avenue Formerly, a Managing Director in
New York, NY 10019 Investment Banking-The Private Equity
Age: 44 Group (1995-2001) and a Vice President
Trustee in Investment Banking-Corporate Finance
(1992-1995) at Merrill Lynch & Co.
Founding Partner of The Carpediem
Group, a private placement firm
(1991-1992). Former Associate at Dillon,
Read and Co. (investment bank)
(1988-1990).
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Interested Trustees:
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Tracy V. Maitland 3 years/since inception President of Advent Capital Management, None.
1065 Avenue of the Americas LLC, which he founded in June, 2001.
31st Floor Prior to June, 2001, President of
New York, NY 10018 Advent Capital Management, a division
Age: 44 of Utendahl Capital.
Trustee, President and
Chief Executive Officer
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Nicholas Dalmaso 3 years/since inception Senior Managing Director and General Trustee, MBIA Capital/Claymore
2455 Corporate West Drive Counsel of Claymore Advisors, LLC and Managed Duration Investment
Lisle, IL 60532 Claymore Securities, Inc. (2001-present). Grade Municipal Fund; Western
Age: 39 Manager, Claymore Fund Management Asset/Claymore U.S. Treasury
Trustee Company, LLC. Formerly, Assistant Inflation Protected Securities
General Counsel, John Nuveen and Company, Fund; Western Asset/Claymore
Inc. (asset manager)(1999-2001). Former U.S. Treasury Inflation
Vice President and Associate General Protected Securities Fund 2;
Counsel of Van Kampen Investments, Inc. Flaherty & Crumrine/Claymore
(1992-1999) Preferred Securities & Income
Fund; Flaherty &
Crumrine/Claymore Total Return
Fund; Dreman/Claymore Dividend
& Income Fund; TS&W/Claymore
Tax-Advantaged Balanced Fund;
and Madison/Claymore Covered
Call Fund.
---------------------------- -------------------------- ----------------------------------------- --------------------------------
Annual Report | October 31, 2004 | 15
AVK | Advent Claymore Convertible Securities and Income Fund
(unaudited)
Unless the registered owner of common shares elects to receive cash by
contacting the Plan Administrator, all dividends declared on common shares of
the Fund will be automatically reinvested by the Bank of New York (the "Plan
Administrator"), Administrator for shareholders in the Fund's Dividend
Reinvestment Plan (the "Plan"), in additional common shares of the Fund.
Participation in the Plan in completely voluntary and may be terminated or
resumed at any time without penalty by notice if received and processed by the
Plan Administrator prior to the dividend record date; otherwise such termination
or resumption will be effective with respect to any subsequently declared
dividend or other distribution. Some brokers may automatically elect to receive
cash on your behalf and may re-invest that cash in additional common shares of
the Fund for you. If you wish for all dividends declared on your common shares
of the Fund to be automatically reinvested pursuant to the Plan, please contact
your broker.
The Plan Administrator will open an account for each common shareholder under
the Plan in the same name in which such common shareholder's common shares are
registered. Whenever the Fund declares a dividend or other distribution
(together, a "Dividend") payable in cash, non-participants in the Plan will
receive cash and participants in the Plan will receive the equivalent in common
shares. The common shares will be acquired by the Plan Administrator for the
participants' accounts, depending upon the circumstances described below, either
(i) through receipt of additional unissued but authorized common shares from the
Fund ("Newly Issued Common Shares") or (ii) by purchase of outstanding common
shares on the open market ("Open-Market Purchases") on the New York Stock
Exchange or elsewhere. If, on the payment date for any Dividend, the closing
market price plus estimated brokerage commission per common share is equal to or
greater than the net asset value per common share, the Plan Administrator will
invest the Dividend amount in Newly Issued Common Shares on behalf of the
participants. The number of Newly Issued Common Shares to be credited to each
participant's account will be determined by dividing the dollar amount of the
Dividend by the net asset value per common share on the payment date; provided
that, if the net asset value is less than or equal to 95% of the closing market
value on the payment date, the dollar amount of the Dividend will be divided by
95% of the closing market price per common share on the payment date. If, on the
payment date for any Dividend, the net asset value per common share is greater
than the closing market value plus estimated brokerage commission, the Plan
Administrator will invest the Dividend amount in common shares acquired on
behalf of the participants in Open-Market Purchases.
If, before the Plan Administrator has completed its Open-Market Purchases, the
market price per common share exceeds the net asset value per common share, the
average per common share purchase price paid by the Plan Administrator may
exceed the net asset value of the common shares, resulting in the acquisition of
fewer common shares than if the Dividend had been paid in Newly Issued Common
Shares on the Dividend payment date. Because of the foregoing difficulty with
respect to Open-Market Purchases, the Plan provides that if the Plan
Administrator is unable to invest the full Dividend amount in Open-Market
Purchases during the purchase period or if the market discount shifts to a
market premium during the purchase period, the Plan Administrator may cease
making Open-Market Purchases and may invest the uninvested portion of the
Dividend amount in Newly Issued Common Shares at net asset value per common
share at the close of business on the Last Purchase Date provided that, if the
net asset value is less than or equal to 95% of the then current market price
per common share; the dollar amount of the Dividend will be divided by 95% of
the market price on the payment date.
The Plan Administrator maintains all shareholders' accounts in the Plan and
furnishes written confirmation of all transactions in the accounts, including
information needed by shareholders for tax records. Common shares in the account
of each Plan participant will be held by the Plan Administrator on behalf of the
Plan participant, and each shareholder proxy will include those shares purchased
or received pursuant to the Plan. The Plan Administrator will forward all proxy
solicitation materials to participants and vote proxies for shares held under
the Plan in accordance with the instruction of the participants.
There will be no brokerage charges with respect to common shares issued directly
by the Fund. However, each participant will pay a pro rata share of brokerage
commission incurred in connection with Open-Market Purchases. The automatic
reinvestment of Dividends will not relieve participants of any Federal, state or
local income tax that may be payable (or required to be withheld) on such
Dividends.
The Fund reserves the right to amend or terminate the Plan. There is no direct
service charge to participants with regard to purchases in the Plan; however,
the Fund reserves the right to amend the Plan to include a service charge
payable by the participants.
All correspondence or questions concerning the Plan should be directed to the
Plan Administrator, The Bank of New York, Two Hanson Place, Brooklyn, New York
11217, Attention: Irina Krylov, Phone Number: (718) 315-4818.
16 | Annual Report | October 31, 2004
Board of Trustees
Nicholas Dalmaso
Tracy V. Maitland
Derek Medina
Ronald A. Nyberg
Gerald L. Seizert
Michael A. Smart
Ronald E. Toupin, Jr.
Officers
Tracy V. Maitland
Chairman of the Board and
Chief Executive Officer
Les Levi
Vice President
F. Barry Nelson
Vice President and Assistant Secretary
Bruce S. Berger
Treasurer and Chief Financial Officer
Rodd Baxter
Secretary
Investment Advisor
Advent Capital Management, LLC
1065 Avenue of the Americas, 31st Floor
New York, New York 10018
Servicing Agent
Claymore Securities, Inc.
Lisle, Illinois
Administrator, Custodian and Transfer Agent
The Bank of New York
New York, New York
Preferred Stock - Dividend Paying Agent
The Bank of New York
New York, New York
Legal Counsel
Skadden, Arps, Slate, Meagher & Flom LLP
New York, New York
Independent Registered
Public Accounting Firm
PricewaterhouseCoopers LLP
New York, New York
Privacy Principles of the Fund
The Fund is committed to maintaining the privacy of its shareholders and to
safeguarding their non-public personal information. The following information is
provided to help you understand what personal information the Fund collects, how
the Fund protects that information and why, in certain cases, the Fund may share
information with select other parties.
Generally, the Fund does not receive any non-public personal information
relating to its shareholders, although certain non-public personal information
of its shareholders may become available to the Fund. The Fund does not disclose
any non-public personal information about its shareholders or former
shareholders to anyone, except as permitted by law or as is necessary in order
to service shareholder accounts (for example, to a transfer agent or third party
administrator).
The Fund restricts access to non-public personal information about its
shareholders to employees of the Fund's investment advisor and its affiliates
with a legitimate business need for the information. The Fund maintains
physical, electronic and procedural safeguards designed to protect the
non-public personal information of its shareholders.
Questions concerning your shares of Advent Claymore Convertible Securities and
Income Fund?
. If your shares are held in a Brokerage Account, contact your Broker.
. If you have physical possession of your shares in certificate form, contact
the Fund's Administrator, Custodian and Transfer Agent.
The Bank of New York, 111 Sanders Creek Parkway, East Syracuse, New York 13057
(800) 701-8178
This report is sent to shareholders of Advent Claymore Convertible Securities
and Income Fund for their information. It is not a Prospectus, circular or
representation intended for use in the purchase or sale of shares of the Fund or
of any securities mentioned in this report.
A description of the Fund's proxy voting policies and procedures related to
portfolio securities is available without charge, upon request, by calling the
Fund at (800) 345-7999 or on the Securities & Exchange Commission's website at
http://www.sec.gov.
Information regarding how the Fund voted proxies for portfolio securities, if
applicable, during the most recent 12-month period ended June 30, is also
available, without charge and upon request by calling the Fund at (800) 345-7999
or by accessing the Fund's Form N-PX on the Commission's website at
http://www.sec.gov.
The Fund files it complete schedule of portfolio holdings with the Securities
and Exchange Commission for the first and third quarters of each fiscal year on
Form N-Q. The Fund's Form N-Q are available on the SEC website at
http://www.sec.gov. The Fund's Form N-Q may also be reviewed and copied at the
Commission's Public Reference Room in Washington, DC; information on the
operation of the Public Reference Room may be obtained by calling (800)
SEC-0330.
Annual Report | October 31, 2004 | 17
Advent Capital Management, LLC
1065 Avenue of the Americas [Graphic Appears Here]
New York, New York 10018
AVK AR 1004
Item 2. Code of Ethics.
(a) The registrant has adopted a code of ethics (the "Code of Ethics") that
applies to its principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions.
(b) Not applicable.
(c) The registrant has not amended its Code of Ethics during the period
covered by the shareholder report presented in Item 1 hereto.
(d) The registrant has not granted a waiver or an implicit waiver from a
provision of its Code of Ethics.
(e) Not applicable.
(f) (1) The registrant's Code of Ethics is attached hereto as an exhibit.
(2) N/A
(3) N/A
Item 3. Audit Committee Financial Expert.
The registrant's Board of Trustees has determined that it has three audit
committee financial experts serving on its audit committee, each of whom is an
"independent" Trustee: Gerald L. Seizert, Michael A. Smart and Ronald Toupin.
Under applicable securities laws, a person who is determined to be an audit
committee financial expert will not be deemed an "expert" for any purpose,
including without limitation for the purposes of Section 11 of the Securities
Act of 1933, as a result of being designated or identified as an audit committee
financial expert. The designation or identification of a person as an audit
committee financial expert does not impose on such person any duties,
obligations, or liabilities that are greater than the duties, obligations, and
liabilities imposed on such person as a member of the audit committee and Board
of Trustees in the absence of such designation or identification.
Item 4. Principal Accountant Fees and Services.
a). Audit Fees: the aggregate fees billed in each of the last two fiscal years
for professional services rendered by the principal accountant for the audit are
as follows:
2004: $70,000
2003: $65,000
b). Audit-Related Fees: the aggregate fees billed in each of the last two fiscal
years for assurance and related services by the principal accountant that are
reasonably related to the performance of the audit of the registrant's financial
statements and are not reported under paragraph (a) of this item are as follows:
2004: $37,500
2003: $45,500
c). Tax Fees, the aggregate fees billed in each of the last two fiscal years for
professional services rendered by the principal accountant for tax compliance,
tax advice, and tax planning are as follows:
2004: $6,500
2003: $6,500
d). All Other Fees, the aggregate fees billed in each of the last two fiscal
years for products and services provided by the principal accountant, other than
the services reported in paragraphs (a) and (c) of this Item are as follows:
2004: n/a
2003: n/a
(e) Audit Committee Pre-Approval Policies and Procedures.
(i) Per Rule 2-01(c)(7)(A), the Audit Committee pre-approves all of the
Audit, Audit-Related, Tax and Other Fees of the Registrant.
ANNEX A
AUDIT COMMITTEE PRE-APPROVAL POLICY
OF
ADVENT CLAYMORE CONVERTIBLE SECURITIES AND INCOME FUND
AS ADOPTED BY THE AUDIT COMMITTEE
JUNE 2003
Statement of Principles
The Audit Committee (the "Audit Committee") of the Board of Trustees
(the "Board") of Advent Claymore Convertible Securities and Income Fund (the
"Trust,") is required to pre-approve all Covered Services (as defined in the
Audit Committee Charter) in order to assure that the provision of the Covered
Services does not impair the auditors' independence. Unless a type of service to
be provided by the Independent Auditor (as defined in the Audit Committee
Charter) is pre-approved in accordance with the terms of this Audit Committee
Pre-Approval Policy (the "Policy"), it will require specific pre-approval by the
Audit Committee or by any member of the Audit Committee to which pre-approval
authority has been delegated.
This Policy and the appendices to this Policy describe the Audit,
Audit-Related, Tax and All Other services that are Covered Services and that
have been pre-approved under this Policy. The appendices hereto sometimes are
referred to herein as the "Service Pre-Approval Documents". The term of any such
pre-approval is 12 months from the date of pre-approval, unless the Audit
Committee specifically provides for a different period. At its June meeting of
each calendar year, the Audit Committee will review and re-approve this Policy
and approve or re-approve the Service Pre-Approval Documents for that year,
together with any changes deemed necessary or desirable by the Audit Committee.
The Audit Committee may, from time to time, modify the nature of the services
pre-approved, the aggregate level of fees pre-approved or both. The Audit
Committee hereby directs that each version of this Policy and the Service
Pre-Approval Documents approved, re-approved or amended from time to time be
maintained with the books and records of the Trust.
Delegation
In the intervals between the scheduled meetings of the Audit Committee,
the Audit Committee delegates pre-approval authority under this Policy to the
Chairman of the Audit Committee (the "Chairman"). The Chairman shall report any
pre-approval decisions under this Policy to the Audit Committee at its next
scheduled meeting. At each scheduled meeting, the Audit Committee will review
with the Independent Auditor the Covered Services pre-approved by the Chairman
pursuant to delegated authority, if any, and the fees related thereto. Based on
these reviews, the Audit Committee can modify, at its discretion, the
pre-approval originally granted by the Chairman pursuant to delegated authority.
This modification can be to the nature of services pre-approved, the aggregate
level of fees approved, or both. The Audit Committee expects pre-approval of
Covered Services by the Chairman pursuant to this delegated authority to be the
exception rather than the rule and may modify or withdraw this delegated
authority at any time the Audit Committee determines that it is appropriate to
do so.
Pre-Approved Fee Levels
Fee levels for all Covered Services to be provided by the Independent
Auditor and pre-approved under this Policy will be established annually by the
Audit Committee and set forth in the Service Pre-Approval Documents. Any
increase in pre-approved fee levels will require specific pre-approval by the
Audit Committee (or the Chairman pursuant to delegated authority).
Audit Services
The terms and fees of the annual Audit services engagement for the Trust
are subject to the specific pre-approval of the Audit Committee. The Audit
Committee will approve, if necessary, any changes in terms, conditions or fees
resulting from changes in audit scope, Trust structure or other matters.
In addition to the annual Audit services engagement specifically
approved by the Audit Committee, any other Audit services for the Trust not
listed in the Service Pre-Approval Document for the respective period must be
specifically pre-approved by the Audit Committee (or the Chairman pursuant to
delegated authority).
Audit-Related Services
Audit-Related services are assurance and related services that are not
required for the audit, but are reasonably related to the performance of the
audit or review of the financial statements of the Trust and, to the extent they
are Covered Services, the other Covered Entities (as defined in the Audit
Committee Charter) or that are traditionally performed by the Independent
Auditor. Audit-Related services that are Covered Services and are not listed in
the Service Pre-Approval Document for the respective period must be specifically
pre-approved by the Audit Committee (or the Chairman pursuant to delegated
authority).
Tax Services
The Audit Committee believes that the Independent Auditor can provide
Tax services to the Covered Entities such as tax compliance, tax planning and
tax advice without impairing the auditor's independence. However, the Audit
Committee will not permit the retention of the Independent Auditor in connection
with a transaction initially recommended by the Independent Auditor, the sole
business purpose of which may be tax avoidance and the tax treatment of which
may not be supported in the Internal Revenue Code and related regulations. Tax
services that are Covered Services and are not listed in the Service
Pre-Approval Document for the respective period must be specifically
pre-approved by the Audit Committee (or the Chairman pursuant to delegated
authority).
All Other Services
All Other services that are Covered Services and are not listed in the
Service Pre-Approval Document for the respective period must be specifically
pre-approved by the Audit Committee (or the Chairman pursuant to delegated
authority).
Procedures
Requests or applications to provide Covered Services that require
approval by the Audit Committee (or the Chairman pursuant to delegated
authority) must be submitted to the Audit Committee or the Chairman, as the case
may be, by both the Independent Auditor and the Chief Financial Officer of the
respective Covered Entity, and must include a joint statement as to whether, in
their view, (a) the request or application is consistent with the SEC's rules on
auditor independence and (b) the requested service is or is not a non-audit
service prohibited by the SEC. A request or application submitted to the
Chairman between scheduled meetings of the Audit Committee should include a
discussion as to why approval is being sought prior to the next regularly
scheduled meeting of the Audit Committee.
(ii) 100% of services described in each of Items 4(b) through (d) were
approved by the audit committee pursuant to paragraph (c)(7)(A) of Rule 2-01 of
Regulation S-X.
(f) The percentage of hours expended on the principal accountant's
engagement to audit the Fund's financial statements for the most recent fiscal
year attributable to work performed by persons other than the principal
accountant's full-time, permanent employees was 0%.
(g) The aggregate non-audit fees billed by the Registrant's accountant for
services rendered to the Fund, the Advisor or any entity controlling, controlled
by, or under common control with the Advisor that provides ongoing services to
the registrant (except for any sub-advisor whose role is primarily portfolio
management and is subcontracted with or overseen by another investment advisor)
that directly impacted the Fund for the period from November 1, 2003 to October
31, 2004 were $0.
(h) n/a
Item 5. Audit Committee of Listed Registrants.
The registrant has a separately designated standing audit committee established
in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934.
The audit committee of the registrant is comprised of: Gerald L. Seizert,
Michael A. Smart and Ronald Toupin.
Item 6. Schedule of Investments.
The Schedule of Investments is included as part of Item 1.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
The registrant has delegated the voting of proxies relating to its voting
securities to its investment advisor, Advent Capital Management, LLC (the
"Advisor"). The Advisor's Proxy Voting Policies and Procedures are included as
an exhibit hereto.
Item 8. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
None.
Item 9. Submission of Matters to a Vote of Security Holders.
The registrant has not made any material changes to the procedures by which
shareholders may recommend nominees to the registrant's Board of Trustees.
Item 10. Controls and Procedures.
(a) The registrant's principal executive officer and principal financial
officer have evaluated the registrant's disclosure controls and procedures
within 90 days of this filing and have concluded that the registrant's
disclosure controls and procedures were effective, as of that date, in ensuring
that information required to be disclosed by the registrant in this Form N-CSR
was recorded, processed, summarized, and reported timely.
(b) The registrant's principal executive officer and principal financial
officer are aware of no changes in the registrant's internal control over
financial reporting that occurred during the registrant's most recent fiscal
half-year that has materially affected, or is reasonably likely to materially
affect, the Registrant's internal control over financial reporting.
Item 11. Exhibits.
(a)(1) Code of Ethics.
(a)(2) Certification of principal executive officer and principal financial
officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
(b) Certification of principal executive officer and principal financial
officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(c) Proxy Voting Policies and Procedures.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Advent Claymore Convertible Securities and Income Fund
By:
------------------------------------------
Name: Tracy V. Maitland
Title: President and Chief Executive Officer
Date:
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, this report has been signed by the following
persons on behalf of the registrant and in the capacities and on the dates
indicated.
By:
------------------------------------------
Name: Tracy V. Maitland
Title: President and Chief Executive Officer
Date:
By:
------------------------------------------
Name: Bruce S. Berger
Title: Treasurer and Chief Financial Officer
Date: