RVMTP Purchase Agreement PIMCO Municipal Income Fund as Issuer and Banc of America Preferred Funding Corporation as Purchaser and BofA Securities, Inc. as DTC Agent April 17, 2024

 

PIMCO Municipal Income Fund

as Issuer

 

and

 

Banc of America Preferred Funding Corporation

as Purchaser

 

and

 

BofA Securities, Inc.

as DTC Agent

 

April 17, 2024

 

CONTENTS

 

 

1.1	Incorporation of Certain Definitions by Reference

2.1	Purchase and Transfer of the RVMTP Shares

(a)

On the Effective Date, the Purchaser will acquire 1,340 RVMTP Shares sold on initial issuance in a transaction (which, based upon the representations of the Issuer and the Purchaser herein, is exempt from registration under the Securities Act), by payment of the Purchase Price in immediately available funds to the Issuer, with such issuance effected through the Securities Depository.

(b)

The Purchaser agrees that it may make offers and sales of the RVMTP Shares in compliance with the Securities Act and applicable state securities laws only to Persons that are (1)(i)  QIBs that are registered closed-end management investment companies, the common shares of which are traded on a national securities exchange ("Closed-End Funds"), banks or entities that are 100% direct or indirect subsidiaries of banks' publicly traded holding company (collectively, "Banks"), insurance companies or registered open-end management investment companies, (ii) tender option bond trusts (or similar vehicles) in which all investors are QIBs that are Closed-End Funds, Banks, insurance companies or registered open-end management investment companies, in each case with respect to clauses (i) and (ii), in accordance with Rule 144A under the Securities Act or pursuant to another available exemption from registration under the Securities Act, in a manner not involving a public offering within the meaning of Section 4(a)(2) of the Securities Act, or (iii) other investors with the prior written consent of the Issuer and (2) unless the prior written consent of the Issuer has been obtained, not PIMCO Persons if such PIMCO Persons would, after such sale and transfer, own more than 20% of the Outstanding RVMTP Shares.  Any transfer in violation of the foregoing restrictions shall be void ab initio.  In connection with any transfer of the RVMTP Shares, each transferee (other than in the case of a tender option bond trust (or similar vehicle) in which the Purchaser holds 100% of the residual certificate interest, the depositor or trustee or other Person thereunder acting on behalf of such transferee) will be required to deliver to the Issuer a transferee certificate set forth as Exhibit C to this Agreement.  The foregoing restrictions on transfer shall not apply to any RVMTP Shares registered under the Securities Act pursuant to the Registration Rights Agreement or any subsequent transfer of such RVMTP Shares thereafter.

2.2

Fees

2.3	Operating Expenses

2.4	Additional Fee for Failure to Comply with Reporting Requirement or Registration Rights Failure

2.5	DTC Eligibility and Settlement of RVMTP Shares

(a)

The Issuer hereby appoints and directs BofA Securities, Inc. to act as the DTC Agent hereunder in accordance with the terms of this Section 2.5, and BofA Securities, Inc. ▇▇▇▇▇▇ accepts such appointment.

(b)

On the Effective Date, the Purchaser shall cause an amount equal to the Purchase Price, to be deposited to the Issuer's account by wire transfer in accordance with the wire transfer instructions set forth on Annex A attached hereto.  Upon confirmation of receipt of the Purchase Price by the Issuer in accordance with the preceding sentence, the Issuer shall grant authorization to proceed with the closing.  Upon closing, the Global RVMTP Shares will be credited directly to the Purchaser's account detailed in Schedule 2 hereto (the "Global RVMTP Shares Account") via free delivery by DTC.  Such delivery shall be accepted by the DTC Participants through DTC no later than 3:30p.m. New York City time on the Effective Date.  Acceptance of such delivery may be deemed to occur upon receipt by the Issuer of a notice of settlement from DTC through the systems of DTC.

(c)

The DTC Agent has taken the following actions in accordance with the terms hereof at the request of the Issuer in order to facilitate the delivery of the Global RVMTP Shares via the DTC book entry system: obtained CUSIP in respect of the RVMTP Shares; coordinated setup of CUSIP on relevant Bloomberg systems; completed DTC eligibility application for Global RVMTP Shares for DTC's book entry system; delivered DTC blanket letter of representations to DTC on behalf of Issuer with respect to the Global RVMTP Shares; and coordinated with DTC to confirm DTC has received relevant materials from the Issuer for the transaction and that DTC has approved settlement of the transaction via DTC's book entry system.  The Issuer has cooperated with the DTC Agent in performance of these actions and agrees to reasonably cooperate with the DTC Agent in all other actions necessary in connection with the performance of the DTC Agent's duties under this Agreement.

(d)

On the Effective Date the DTC Agent will coordinate with DTC in connection with the delivery of the Global RVMTP Shares as contemplated in this Agreement, including, liaising with DTC on a closing call to be held on the Effective Date.

(e)

(i) The Issuer and the DTC Agent agree that the DTC Agent has undertaken the duties described above solely as a "Clearing DTC Participant" and not as an "underwriter" (as defined in Section 2(a)(11) of the Securities Act) or placement agent.

(f)

The DTC Agent represents and warrants with respect to itself, as of the date hereof and as of the Effective Date, to the Issuer as follows: the DTC Agent has confirmed that CUSIP has established a "fixed field" attached to the CUSIP number for the Series 2054 RVMTP Shares containing the "144A" indicator.

(a)

this Agreement shall have been duly executed and delivered by the parties hereto;

(b)

the RVMTP Shares shall have a long-term issue credit rating of at least AA (or its equivalent) from at least one Rating Agency on the Effective Date;

(c)

receipt by the Purchaser of executed originals, or copies certified by a duly authorized officer of the Issuer to be in full force and effect and not otherwise amended, of all Related Documents (other than the global shares representing the RVMTP Shares), as in effect on the Effective Date, and an incumbency certificate with respect to the authorized signatories thereto;

(d)

receipt by the Purchaser of opinions of counsel for the Issuer, substantially to the effect of Exhibit A;

(e)

receipt by the Purchaser of an opinion of counsel for the Calculation and Paying Agent substantially to the effect of Exhibit A-3 which opinion may be delivered by external counsel or in-house counsel to the Calculation and Paying Agent;

(f)

except as disclosed in the Offering Memorandum, there shall not be any pending or threatened material litigation of the nature described in Section 4.5 (unless such pending or threatened litigation has been determined by the Purchaser to be acceptable);

(g)

any of the fees and expenses invoiced no later than two days prior to the Effective Date pursuant to clause (i) of Section 2.2 hereof shall have been paid;

(h)

the Purchaser, in its reasonable discretion, shall be satisfied that no change in law, rule or regulation (or their interpretation or administration), in each case, shall have occurred which will adversely affect the consummation of the transaction contemplated by this Agreement;

(i)

there shall have been delivered to the Purchaser any additional documentation and financial information, including satisfactory responses to its due diligence inquiries, as it reasonably deems relevant; and

(j)

there shall have been delivered to the Purchaser such information and copies of documents, approvals (if any) and records certified, where appropriate, of trust proceedings as the Purchaser may have reasonably requested relating to the Issuer's entering into and performing this Agreement and the other Related Documents to which it is a party, and the transactions contemplated hereby and thereby.

4.1

Existence

4.2	Authorization; Contravention

4.3	Binding Effect

4.4	Financial Information

4.5	Litigation

4.6

Consents

4.7	Additional Representations and Warranties

(a)

The Series 2054 RVMTP Shares conform in all material respects to those set forth in the Statement attached to the Offering Memorandum.

(b)

As of the Date of Original Issue, the Series 2054 RVMTP Shares satisfy the eligibility requirements of Rule 144A(d)(3) under the Securities Act, and no securities of the same class (within the meaning of Rule 144A(d)(3) under the Securities Act) as the Series 2054 RVMTP Shares are listed on any national securities exchange registered under Section 6 of the Securities Exchange Act of 1934, as amended, or quoted in a U.S. automated inter-dealer quotation system.

(c)

Assuming the accuracy of the representations and warranties of the Purchaser set forth herein, neither the Issuer, nor, to the Issuer's knowledge, any Person acting on its behalf, has, directly or indirectly, made offers or sales of any security (as defined in the Securities Act), or solicited offers to buy any security, under circumstances that would require the registration of the Series 2054 RVMTP Shares under the Securities Act.

(d)

If the Issuer establishes a Bloomberg screen for the RVMTP Shares, the Issuer will request that ▇▇▇▇▇▇▇▇▇, L.P. include the following (or similar) language on each Bloomberg screen containing information about the Series 2054 RVMTP Shares:

(i)

the "Note Box" on the bottom of the "Security Display" page describing the Series 2054 RVMTP Shares will state: "Iss'd Under 144A."

(ii)

the "Security Display" page will have flashing a red indicator "See Other Available Information."

(iii)

the indicator will link to the "Additional Security Information" page, which will state that the securities are being offered in reliance on the exemption from registration under Rule 144A of the Securities Act to persons who are qualified institutional buyers (as defined in Rule 144A under the Securities Act).

(e)

The Issuer's authorized equity capitalization is as set forth, or incorporated by reference, in the Offering Memorandum; the equity capital of the Issuer conforms in all material respects to the description thereof contained, or incorporated by reference, in the Offering Memorandum; all outstanding Common Shares have been duly authorized and validly issued and are fully paid and, except as set forth in the Offering Memorandum, nonassessable; and, except as set forth in the Offering Memorandum, no options, warrants or other rights to purchase, agreements or other obligations to issue, or rights to convert any obligations into or exchange any securities for, shares of capital stock of or ownership interests in the Issuer are outstanding.

(f)

The statements in the Offering Memorandum under the headings “Anti-Takeover and Other Provisions of the Declaration of Trust”, “Description of Capital Structure”, and “Tax Matters” insofar as such statements summarize matters of United States federal law, agreements, documents or proceedings discussed therein, are accurate and fair summaries in all material respects of such matters, agreements, documents or proceedings.

(g)

Each of the filings with the Securities and Exchange Commission that it is required to make under the 1940 Act (each such filing, a "1940 Act Document") complies in all material respects with the requirements of the 1940 Act, and each 1940 Act Document did not at the time of filing with the Securities and Exchange Commission include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(h)

No consent, approval, authorization, filing with or order of any court or governmental agency or body is required by the Issuer in connection with the transactions contemplated in this Agreement, the Calculation and Paying Agent Agreement, the Statement and the Offering Memorandum (collectively, the "Issuer Agreements"), except such as have been made or obtained under Blue Sky laws of the various states and foreign jurisdictions, the Securities Act, the 1940 Act and the rules and regulations of the Financial Industry Regulatory Authority, Inc., and except where the failure to obtain such consent, approval, authorization, order, permit or qualification would not have an Issuer Material Adverse Effect.

(i)

None of the execution, delivery or performance of any of the Issuer Agreements, nor the consummation of the transactions herein or therein contemplated, nor the fulfillment of the terms hereof or thereof, conflict with, result in a breach or violation of, or require or result in imposition of any material lien, charge or encumbrance upon any property or assets of the Issuer pursuant to, (i) the Declaration or the Statement, or (ii) the terms of any material indenture, contract, lease, mortgage, deed of trust, note agreement, loan agreement or other agreement, obligation, condition, covenant or instrument to which the Issuer is a party or by which it is bound or to which its property is subject, or materially violates or will materially violate any material statute, law, rule, regulation, judgment, order or decree applicable to the Issuer of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over the Issuer or any of its properties.

(j)

The Issuer is not in violation or default of any provision of its Declaration or the Statement, or in material violation of (i) the terms of any material indenture, contract, lease, mortgage, deed of trust, note agreement, loan agreement or other agreement, obligation, condition, covenant or instrument to which it is a party or bound or to which its property is subject or (ii) any material statute, law, rule, regulation, judgment, order or decree of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over the Issuer or any of its properties, except in the case of clause (i) where such violation or default would not have an Issuer Material Adverse Effect.

(k)

Since the date as of which information is given in the Offering Memorandum, except as otherwise stated therein, (i) no transaction or event has occurred and no change has occurred in the condition (financial or otherwise) or operations of the Issuer that would materially and adversely affect its ability to perform its obligations under this Agreement and the other Related Documents to which it is a party or by which it is bound and (ii) there have been no transactions entered into by the Issuer which are material to the Issuer other than those in the ordinary course of its business or as described or contemplated in the Offering Memorandum (and any amendment or supplement thereto).

(l)

Pricewaterhouse Coopers LLP, an independent registered public accounting firm, previously audited the Issuer's financial statements dated December 31, 2023.  Pricewaterhouse Coopers LLP has delivered its reports with respect to the audited financial statements included or incorporated by reference in the Offering Memorandum.

(m)

The Issuer's trustees and officers errors and omissions insurance policy and its fidelity bond required by Rule 17g-1 under the 1940 Act are in full force and effect; the Issuer is in compliance with the terms of such policy and fidelity bond in all material respects; and there are no claims by the Issuer under any such policy or fidelity bond as to which any insurance company is denying liability or defending under a reservation of rights clause; the Issuer has not been refused any insurance coverage sought or applied for; and the Issuer has no reason to believe that it will not be able to renew its existing insurance coverage and fidelity bond as and when such coverage and fidelity bond expires or to obtain similar coverage and fidelity bond from similar insurers as may be necessary to continue its business at a cost that would not have a material adverse effect on the condition (financial or otherwise), business prospects, earnings, business, properties, net assets or results of operations of the Issuer (other than as a result of a change in the financial markets generally), whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Offering Memorandum.

(n)

The Issuer possesses all licenses, certificates, permits and other authorizations issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct its business, and the Issuer has not received any notice of proceedings relating to the revocation or modification of any such license, certificate, permit or authorization which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a material adverse effect on the condition (financial or otherwise), business prospects, earnings, business or properties of the Issuer (other than as a result of a change in the financial markets generally), whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Offering Memorandum.

(o)

The Issuer maintains and will maintain a system of internal accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management's general or specific authorization and with the investment objectives, policies and restrictions of the Issuer and the applicable requirements of the 1940 Act and the Code; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with accounting principles generally accepted in the United States, to calculate net asset value, to maintain accountability for assets and to maintain material compliance with the books and records requirements under the 1940 Act; (iii) access to assets is permitted only in accordance with management's general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.  The Issuer employs "internal controls over financial reporting" (as such term is defined in Rule 30a-3 under the 1940 Act) and such internal controls over financial reporting are effective as required the 1940 Act.  The Issuer is not aware of any material weakness in its internal controls over financial reporting.

(p)

The Issuer maintains "disclosure controls and procedures" (as such term is defined in Rule 30a-3 under the 1940 Act); such disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.

(q)

Except as described in the Offering Memorandum, the Issuer has not taken, directly or indirectly, any action designed to or that would constitute or that might reasonably be expected to cause or result in a violation of federal securities laws or in stabilization or manipulation of the price of any security of the Issuer to facilitate the resale of the Series 2054 RVMTP Shares, and the Issuer is not aware of any such action taken or to be taken by any affiliates of the Issuer.

(r)

Each of the Custodian Agreement between the Issuer and State Street Bank and Trust Company, dated as of June 25, 2001, as amended, the Investment Management Agreement between the Issuer and the Investment Manager, dated as of September 5, 2014, as amended (the "Investment Management Agreement"), and the Calculation and Paying Agent Agreement between the Issuer and the Calculation and Paying Agent, dated as of April 17, 2024 complies in all material respects with all applicable provisions of the 1940 Act, the Advisers Act, and the Issuer's trustees and the Issuer's shareholders have approved the Investment Management Agreement in accordance with Sections 15(a) and (c) of the 1940 Act.

(s)

Except as set forth or incorporated by reference in the Offering Memorandum, no trustee of the Issuer is an "interested person" (as defined in the 1940 Act) of the Issuer.

(t)

The Issuer has filed all foreign, federal, state and local tax returns required to be filed or has properly requested extensions thereof (except in any case in which the failure so to file would not have an Issuer Material Adverse Effect (other than as a result of a change in the financial markets generally), whether or not arising from transactions in the ordinary course of business, except as set forth or incorporated by reference in or contemplated in the Offering Memorandum) and has paid all taxes required to be paid by it and any other assessment, fine or penalty levied against it, to the extent that any of the foregoing is due and payable, except for any such assessment, fine or penalty that is currently being contested in good faith or as would not have an Issuer Material Adverse Effect (other than as a result of a change in the financial markets generally), whether or not arising from transactions in the ordinary course of business, except as set forth or incorporated by reference in or contemplated in the Offering Memorandum; and the Issuer has been and is currently in compliance with the requirements of Subchapter M of the Code to qualify as a regulated investment company under the Code.

(u)

There are no transfer taxes or other similar fees or charges under federal law or the laws of any state, or any political subdivision thereof, required to be paid in connection with the execution and delivery of this Agreement.

(v)

The Issuer has adopted and implemented written policies and procedures reasonably designed to prevent violation of the Federal Securities Laws (as that term is defined in Rule 38a-1 under the 1940 Act) by the Issuer, including policies and procedures that provide oversight of compliance by each investment adviser and transfer agent of the Issuer.

(w)

The offering of the Series 2054 RVMTP Shares in the manner contemplated by the Offering Memorandum has been conducted in a manner by the Issuer and its agents so as not to violate any applicable federal securities laws, including the 1940 Act, the Advisers Act, or any applicable state laws.

4.8	Complete and Correct Information

4.9	Offering Memorandum

4.10	1940 Act Registration

4.11	Effective Leverage Ratio; 1940 Act Asset Coverage

4.12	Investments

4.13	Due Diligence

4.14	Certain Fees

4.15	Eligible Assets

4.16	Capital Structure

5.1

Existence

5.2	Authorization; Contravention

5.3	Binding Effect

5.4	Own Account

5.5	Litigation

5.6

Consents

5.7	Purchaser Status

5.8	Experience of The Purchaser

5.9	General Solicitation

5.10	Certain Transactions

5.11	Certain Fees

5.12	Access to Information

5.13	Due Diligence

6.1	Information

(a)

notice of any change in, or suspension or termination of, the ratings on the RVMTP Shares by any Rating Agency (and any corresponding change in the Rating Agency Guidelines applicable to the RVMTP Shares associated with any such change in the rating from any Rating Agency) or any change of a Rating Agency rating the RVMTP Shares as promptly as practicable upon the Issuer having knowledge of the occurrence thereof;

(b)

notice of any redemption or other repurchase by the Issuer of any or all of the RVMTP Shares as provided in the Statement;

(c)

subject to Section 6.2, notice of any proposed amendments to any of the Related Documents at such time as the amendments are sent to other third parties (other than the Board of Trustees) whose approval is required for such amendment and in any event not less than ten (10) Business Days prior to the effectiveness of any proposed amendment and copies of all actual amendments thereto within ten (10) Business Days of being signed or, in each case, as provided in the relevant document;

(d)

notice of any missed, reduced or deferred dividend payment on the RVMTP Shares that remains uncured for more than three (3) Business Days as soon as reasonably practicable, but in no event later than one (1) Business Day after expiration of the foregoing grace period;

(e)

notice of the failure to make any deposit provided for under Section 2.6(e) of the Statement in respect of a properly noticed redemption as soon as reasonably practicable, but in no event later than two (2) Business Days after discovery of such failure to make any such deposit;

(f)

notice of non-compliance with the Rating Agency Guidelines (if applicable) for more than five (5) Business Days as soon as reasonably practicable upon the Issuer having actual knowledge of such non-compliance, but in no event later than two (2) Business Days after expiration of the foregoing grace period;

(g)

if (i) the Issuer provides a Notice of Taxable Allocation to the Calculation and Paying and Paying Agent pursuant to Section 2.11(a) of the Statement, the Notice of Taxable Allocation prior to the Dividend Period with respect to which the Notice of Taxable Allocation relates, (ii) the Issuer makes a Taxable Allocation via an Additional Amount Payment pursuant to Section 2.11(b) of the Statement, a notice to the Purchaser delivered as soon as practicable following the Issuer becoming aware of such Taxable Allocation, or (iii) the Issuer otherwise directs the Calculation and Paying Agent to send an Additional Amount Payment to any Holders in respect of a Taxable Allocation pursuant to Section 2.11(c) of the Statement, a notice to be delivered as soon as practicable following the Issuer becoming aware of such Taxable Allocation;

(h)

notice of any replacement of any investment adviser or sub-adviser, if any, of the Issuer within two (2) Business Days after a resignation or a notice of removal has been sent by or to any investment adviser or sub-adviser;

(i)

notice no later than two (2) Business Days after the occurrence thereof of (i) the failure of the Issuer to pay the amount due on any "senior securities" (as defined under the 1940 Act) or other debt at the time outstanding (other than the RVMTP Shares), and any period of grace or cure with respect thereto shall have expired; (ii) the failure of the Issuer to pay, or the Issuer admitting in writing its inability to pay, its debts generally as they become due; or (iii) the failure of the Issuer to pay accumulated dividends on any Preferred Shares (other than the RVMTP Shares) ranking pari passu with the RVMTP Shares, and any period of grace or cure with respect thereto shall have expired;

(j)

notice of a material breach of any representation, warranty or covenant of the Issuer contained in this Agreement, the Registration Rights Agreement or the Statement, in each case, only if any officer of the Issuer has actual knowledge of such breach as soon as reasonably practicable, but in no event later than five (5) Business Days, after knowledge of any officer of the Issuer or the Investment Manager;

(k)

notice of any litigation, administrative proceeding or business development which may reasonably be expected to materially adversely affect the Issuer's business, properties or affairs or the ability of the Issuer to perform its obligations as set forth hereunder or under any of the Related Documents to which it is a party as soon as reasonably practicable, but in no event later than ten (10) days after knowledge of any officer of the Issuer thereof;

(l)

unless such information constitutes material non-public information, within seven (7) Business Days after the last day of each month a statement (which may be included with the information provided pursuant to Sections 6.1(n) and 6.1(o) below) indicating the number of outstanding preferred shares of the Issuer together with the amount of any increase or decrease in such number since the prior monthly statement;

(m)

upon request of the Purchaser, copies of all certificates that the Issuer has delivered to any Rating Agency pursuant to the respective Rating Agency Guidelines (if applicable) regarding the 1940 Act Asset Coverage and all related calculations at such times and containing such information as set forth in the respective Rating Agency Guidelines (if applicable) as soon as reasonably practicable after such certificates have been sent;

(n)

within seven (7) Business Days after the last day of each month, a report of portfolio holdings of the Issuer as of the close of business of the last Business Day of such month, prepared on a basis substantially consistent with the periodic reports of portfolio holdings of the Issuer prepared for financial reporting purposes;

(o)

within seven (7) Business Days after the last day of each month, the information set forth in Exhibit D to this Agreement and a calculation of the Effective Leverage Ratio, the 1940 Act Asset Coverage and the Additional Asset Coverage of the Issuer as of the close of business of the last Business Day of such month; and upon the failure of the Issuer to maintain 1940 Act Asset Coverage or Additional Asset Coverage as provided in Section 2.4(a) of the Statement or the Effective Leverage Ratio as required by Section 2.4(c) of the Statement, notice of such failure within two (2) Business Days of the occurrence thereof; and

(p)

from time to time such additional information regarding the financial position, results of operations or prospects of the Issuer as the Purchaser may reasonably request including, without limitation, copies of all offering memoranda or other offering material with respect to the sale of any securities of the Issuer as soon as reasonably practicable, but in no event later than twenty (20) calendar days after a request.

6.2	No Amendment or Certain Other Actions Without Consent of the Purchaser

6.3	Maintenance of Existence

6.4	Tax Status of the Issuer

6.5	Payment Obligations

6.6	Compliance With Law

6.7	Maintenance of Approvals: Filings, Etc.

6.8	Inspection Rights; Status of Information

6.9	1940 Act Registration

6.10	Investments

6.11	Maintenance of Effective Leverage Ratio

6.12	Calculation and Paying Agent

6.13	Cooperation in the Sale of the RVMTP Shares

6.14	Use of Proceeds

6.15	Securities Depository

6.16	Future Agreements

6.17	Eligible Assets

7.1

Notices

(a)

if to the Issuer:

(b)

if to the Purchaser or to the DTC Agent, care of the Purchaser:

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7.2	No Waivers

(a)

The obligations of the Issuer hereunder shall not in any way be modified or limited by reference to any other document, instrument or agreement (including, without limitation, the RVMTP Shares or any other Related Document).  The rights of the Purchaser hereunder are separate from and in addition to any rights that any Holder or Designated Owner of any RVMTP Share may have under the terms of such RVMTP Share or any Related Document or otherwise.

(b)

No failure or delay by the Issuer or the Purchaser in exercising any right, power or privilege hereunder or under the RVMTP Shares shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege.  No failure or delay by the Issuer or the Purchaser in exercising any right, power or privilege under or in respect of the RVMTP Shares or any other Related Document shall affect the rights, powers or privileges of the Issuer or the Purchaser hereunder or shall operate as a limitation or waiver thereof.  The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law.

7.3	Expenses and Indemnification

(a)

The Issuer shall upon demand reimburse the Purchaser (to the extent that payments for the following items are not made under the other provisions hereof) for all reasonable out-of-pocket expenses (including reasonable fees and costs of outside counsel, and reasonable consulting, accounting, appraisal, investment banking, and similar professional fees and charges) incurred by the Purchaser in connection with the enforcement of or preservation of rights under this Agreement, provided, however, that the Issuer shall not be responsible for the Purchaser's costs in connection with any subsequent offer and sale of the RVMTP Shares made by the Purchaser pursuant to Rule 144A under the Securities Act or another available exemption from registration under the Securities Act, in a manner not involving any public offering within the meaning of Section 4(a)(2) of the Securities Act. The Issuer shall not be responsible under this Section 7.3(a) for the fees and costs of more than one law firm in any one jurisdiction with respect to any one proceeding or set of related proceedings for the Purchaser, unless the Purchaser shall have reasonably concluded that there are legal defenses available to it that are different from or additional to those available to the Issuer.

(b)

The Issuer agrees to indemnify and hold harmless the Purchaser and each other Indemnified Person of the Purchaser from and against any losses, claims, damages, liabilities and reasonable out-of-pocket expenses incurred by them (including reasonable fees and disbursements of outside counsel) which are related to or arise out of (A) any material misstatements or any material statements omitted to be made in the Offering Memorandum (including any documents incorporated by reference therein) or (B) any claim by any third party relating to the offering or sale of the RVMTP Shares by the Issuer or the holding of the RVMTP Shares by the Purchaser (x) that the Purchaser aided and abetted a breach of a fiduciary duty by the Issuer or any director or officer of the Issuer or (y) arising from any act by the Issuer or any director or officer of the Issuer (excluding in any such case of either clauses (A) or (B), claims, losses, liabilities or expenses arising out of or resulting from the gross negligence or willful misconduct of any Indemnified Person as determined by a court of competent jurisdiction).

(c)

The indemnifying party also agrees that if any indemnification sought by an Indemnified Person pursuant to this Agreement is unavailable or insufficient, for any reason, to hold harmless the Indemnified Persons of such other party in respect of any losses, claims, damages or liabilities (or actions in respect thereof), then the indemnifying party, in order to provide for just and equitable contribution, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages and liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect (i) the relative benefits received by the Issuer on the one hand and the Purchaser on the other hand from the actual or proposed transactions giving rise to or contemplated by this Agreement or (ii) if the allocation provided by the foregoing clause (i) is not permitted by applicable law, not only such relative benefits but also the relative fault of the Issuer on the one hand and the Purchaser on the other, in connection with the statements or omissions or alleged statements or omissions that resulted in such losses, claims, damages, liabilities or expenses (or actions in respect thereof), as well as any other relevant equitable considerations; provided that in any event the aggregate contribution of the Purchaser and its Indemnified Persons to all losses, claims, damages, liabilities and expenses with respect to which contributions are available hereunder will not exceed the amount of dividends actually received by the Purchaser from the Issuer pursuant to the proposed transactions giving rise to this Agreement.  For purposes of determining the relative benefits to the Issuer on the one hand, and the Purchaser on the other, under the proposed transactions giving rise to or contemplated by this Agreement, such benefits shall be deemed to be in the same proportion as (i) the net proceeds received or proposed to be received by the Issuer pursuant to the transactions, whether or not consummated bears to (ii) the dividends and Optional Redemption Premium paid by the Issuer to the Purchaser in connection with the proposed transactions giving rise to or contemplated by this Agreement.  The relative fault of the parties shall be determined by reference to, among other things, whether the actions taken or omitted to be taken in connection with the proposed transactions contemplated by this Agreement (including any misstatement of a material fact or the omission to state a material fact) relates to information supplied by the Issuer on the one hand, or the Purchaser on the other, the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such action, misstatement or alleged omission, and any other equitable considerations appropriate in the circumstances.  No Person found liable for a fraudulent misrepresentation shall be entitled to contribution from any Person who is not also found liable for such fraudulent misrepresentation.  The indemnity, reimbursement and contribution obligations under this Agreement shall be in addition to any rights that any Indemnified Person may have at common law or otherwise.

(d)

If any action, suit, proceeding or investigation is commenced, as to which an Indemnified Person proposes to demand indemnification, it shall notify the indemnifying party with reasonable promptness; provided, however, that any failure by such Indemnified Person to notify the indemnifying party shall not relieve the indemnifying party from its obligations hereunder (except to the extent that the indemnifying party is materially prejudiced by such failure to promptly notify).  The indemnifying party shall be entitled to assume the defense of any such action, suit, proceeding or investigation, including the employment of counsel reasonably satisfactory to the Indemnified Person.  The Indemnified Person shall have the right to counsel of its own choice to represent it, but the fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the indemnifying party has failed promptly to assume the defense and employ counsel reasonably satisfactory to the Indemnified Person in accordance with the preceding sentence or (ii) the Indemnified Person shall have been advised by counsel that there exist actual or potential conflicting interests between the indemnifying party and such Indemnified Person, including situations in which one or more legal defenses may be available to such Indemnified Person that are different from or additional to those available to the indemnifying party; provided, however, that the indemnifying party shall not, in connection with any one such action or proceeding or separate but substantially similar actions or proceedings arising out of the same general allegations be liable for fees and expenses of more than one separate firm of attorneys at any time for all Indemnified Persons of such other party; and such counsel shall, to the extent consistent with its professional responsibilities, cooperate with the indemnifying party and any counsel designated by the indemnifying party.

(e)

Nothing in this Section 7.3 is intended to limit any party's obligations contained in other parts of this Agreement or the RVMTP Shares.

7.4	Amendments and Waivers

7.5	Successors and Assigns

7.6	Term of this Agreement

7.7	Governing Law

7.8	Waiver of Jury Trial

7.9	Counterparts

7.10	Beneficiaries

7.11	Entire Agreement

7.12	Relationship to the Statement

7.13	Confidentiality

7.14	Severability

7.15	Consent Rights of the Majority Participants to Certain Actions.

(a)

The termination by the Issuer of any Rating Agency or the selection of any Other Rating Agency, either in replacement for a Rating Agency or as an additional Rating Agency with respect to the RVMTP Shares.

(b)

The Issuer issuing or permitting to exist any “senior security” (as defined in the 1940 Act as of the date hereof or, in the event such definition shall be amended, with such changes to the definition thereof as consented to by the Majority Participants) other than the RVMTP Shares issued and sold pursuant to this Agreement or indebtedness for borrowed money of the Issuer, except (i) borrowings for temporary purposes in an amount not to exceed 5% of the assets of the Issuer, which borrowings are repaid within sixty (60) days of the incurrence thereof, (ii) the issuance of senior securities or the incurrence of indebtedness for borrowed money, the proceeds of which will be used for the exchange, retirement, redemption or repurchase of the RVMTP Shares, and costs incurred in connection therewith, (iii) the Issuer's previously issued and outstanding Auction Rate Preferred Shares, if any, and Remarketable Variable Rate MuniFund Term Preferred Shares, if any, (iv) the issuance of additional series of Remarketable Variable Rate MuniFund Term Preferred Shares (including, but not limited to, any additional Series of RVMTP Shares) or other Preferred Shares and (v) as may be otherwise approved or consented to by the Majority Participants, provided that if any such "senior security" is created or incurred by the Issuer it shall not require the approval of the Majority Participants if the Issuer exchanges, redeems, retires or terminates such "senior security" or otherwise cures such non-compliance within ten (10) Business Days of receiving notice of the existence thereof.

(c)

The Issuer (i) creating or incurring or permitting to be incurred or to exist any lien on any other funds, accounts or other property held under the Declaration or the Statement, except as permitted by the Declaration or the Statement or (ii) except for any lien for the benefit of the Custodian of the Issuer on the assets of the Issuer held by such Custodian, or any lien arising by operation of law, pledging any portfolio security to secure any senior securities or other liabilities to be incurred by the Issuer (including under any tender option bond trust (or similar vehicle) of which the residual floating rate trust certificates will be owned by the Issuer) unless the securities pledged pursuant to all such pledge or other security arrangements are valued for purposes of such security arrangements in an aggregate amount not less than 70% of their aggregate Market Value for purposes of determining the value of the collateral required to be posted or otherwise provided under all such security arrangements; provided, that the required collateral value under such security arrangements shall not exceed the Market Value of the exposure of each secured party to the credit of the Issuer; and provided further, that it shall not require the approval of the Majority Participants if any pledge or security interest in violation of the preceding sentence is created or incurred by the Issuer and the Issuer cures such violation within ten (10) Business Days of receiving notice of the existence thereof.

(d)

Approval of any amendment, alteration or repeal of any provision of the Declaration or the Statement, whether by merger, consolidation or otherwise, that would affect any preference, right or power of the RVMTP Shares or the Holders thereof provided, however, that (i) a change in the capitalization of the Issuer in accordance with Section 2.9 of the Statement shall not be considered to affect the rights and preferences of the RVMTP Shares, and (ii) a division of an RVMTP Share shall be deemed to affect such preferences, rights or powers only if the terms of such division materially and adversely affect the Holders of the RVMTP Shares.  For purposes of the foregoing, no matter shall be deemed to affect any preference, right or power of an RVMTP Share of any Series or the Holder thereof unless such matter (A) alters or abolishes any preferential right of such RVMTP Share, or (B) creates, alters or abolishes any right in respect of redemption of such RVMTP Share (other than solely as a result of a division of an RVMTP Share).

(e)

Approval of any action to be taken pursuant to Sections 2.6(h) and 2.16 of the Statement other than the issuance of additional series of Remarketable Variable Rate MuniFund Term Preferred Shares, including, but not limited to, any additional Series of RVMTP Shares, or other Preferred Shares.

7.16	No Individual Liability

	PIMCO MUNICIPAL INCOME FUND
	By:	/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇

		Name:	▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
		Title:	President

	BANC OF AMERICA PREFERRED FUNDING CORPORATION
	By:	/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇

		Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
		Title: Authorized Signatory

	BOFA SECURITIES, INC.
	(solely with respect to Section 2.5 and Article VII of this Agreement)
	By:	/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇

		Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
		Title: Authorized Signatory

Description of RVMTP Shares:

1,340 PIMCO Municipal Income Fund Remarketable Variable Rate MuniFund Term Preferred Shares, Series 2054 with a Liquidation Preference of $100,000 per share, issued in exchange for the Purchase Price. With CUSIP: ▇▇▇▇▇▇▇▇▇.

1.

“Eligible Assets” are hereby defined to consist only of the following as of the time of

A.

Debt obligations

i.

"Municipal securities," defined as obligations of a State, the District of Columbia, a U.S. territory or a political subdivision thereof, and including general obligations, limited obligation bonds, revenue bonds, and obligations that satisfy the requirements of section 142(b)(1) of the Internal Revenue Code of 1986 issued by or on behalf of any State, the District of Columbia, any U.S. territory or any political subdivision thereof, including any municipal corporate instrumentality of 1 or more States, or any public agency or authority of any State, the District of Columbia, any U.S. territory or any political subdivision of thereof, including obligations of any of the foregoing types related to financing a 501(c)(3) organization. For the purposes of the foregoing, "municipal securities" may include, "municipal securities" acquired via origination or acquisition by the Fund, loan assignments, loan participations or similar interests that may not be considered "securities" as defined under the Securities Act (such securities, "Municipal Loan Investments"), provided that the Fund (i) will not invest more than 10% of the Fund's total assets in such Municipal Loan Investments and (ii) will not invest in a Municipal Loan Investment if it would result in more than 3% of the Fund's total assets being loaned, directly or indirectly, to a particular borrower (in each case measured at the time of investment). The purchase of any municipal security will be based upon the Investment Manager's assessment of an asset's relative value in terms of current yield, price, credit quality, and future prospects; and the Investment Manager will monitor the Issuer's creditworthiness of its portfolio investments and analyze economic, political and demographic trends affecting the markets for such assets. Eligible Assets shall include any municipal securities that at the time of purchase are paying scheduled principal and interest or if at the time of purchase are in payment default, then in the sole judgment of the Investment Manager are expected to produce payments of principal and interest whose present value exceeds the purchase price.

ii.

Debt obligations of the United States.

iii.

Debt obligations issued, insured, or guaranteed by a department or an agency of the U.S. Government, if the obligation, insurance, or guarantee commits the full faith and credit of the United States for the repayment of the obligation.

iv.

Debt obligations of the Washington Metropolitan Area Transit Authority guaranteed by the Secretary of Transportation under Section 9 of the National Capital Transportation Act of 1969.

v.

Debt obligations of the Federal Home Loan Banks.

vi.

Debt obligations, participations or other instruments of or issued by the Federal National Mortgage Association or the Government National Mortgage Association.

vii.

Debt obligations which are or ever have been sold by the Federal Home Loan Mortgage Corporation pursuant to sections 305 or 306 of the Federal Home Loan Mortgage Corporation Act.

viii.

Debt obligations of any agency named in 12 U.S.C. § 24(Seventh) as eligible to issue obligations that a national bank may underwrite, deal in, purchase and sell for the bank's own account, including qualified Canadian government obligations.

ix.

Debt obligations of issuers other than those specified in (i) through (viii) above that are not "distressed or in default" and that are "marketable." For these purposes, an obligation is

x.

Other assets that are not described in (i) through (viii) above, if the Investment Manager provides written notice to the Purchaser indicating the Issuer's intent to invest in such asset and describing such asset in reasonable detail at least five Business Days prior to such investment and the Purchaser affirmatively approves such investment. The Purchaser will use commercially reasonable efforts to respond to the Investment Manager's request within such five Business Day period.

xi.

Certificates or other securities evidencing ownership interests in a municipal bond trust structure (generally referred to as a tender option bond structure) that invests in (a) debt obligations of the types described in (i) above or (b) depository receipts reflecting ownership interests in accounts holding debt obligations of the types described in (i) above.

xii.

Bank capital securities of both non-U.S. (foreign) and U.S. issuers, other obligations including without limitation certificates of deposit, bankers' acceptances and fixed time deposits.

•

it provides for repayment of principal and interest in any form including fixed and floating rate, zero interest, capital appreciation, discount, leases, and payment in kind; or

•

it is for long-term or short-term financing purposes.

B.

Derivatives

i.

Interest rate derivatives;

ii.

Swaps, futures, forwards, structured notes, options and swaptions related to Eligible Assets or on an index related to Eligible Assets; or

iii.

Credit default swaps.

C.

Other Assets

i.

Cash;

ii.

Repurchase agreements on assets described in A above; or

iii.

Taxable fixed-income securities, for the purpose of acquiring control of an issuer whose municipal bonds (a) the Issuer already owns and (b) have deteriorated or are expected shortly to deteriorate that such investment should enable the Issuer to better maximize its existing investment in such Issuer, provided that the Issuer may invest no more than 0.5% of its total assets in such securities.

D.

Assets not otherwise covered in A, B or C above that the Investment Manager may determine are in the best interest of shareholders of the Issuer to acquire in pursuing a workout arrangement with issuers (of the types described in A above) of defaulted obligations, including, but not limited to, loans to the defaulted issuer or another party pursuant to the workout arrangement, or a debt, equity or other interest in the defaulted issuer or other party to the workout arrangement, provided that the Issuer may not invest more than 2% of its total assets in any such assets (as measured at the time of investment). The Issuer agrees that it will only acquire equity securities pursuant to this Section 1.D. that it reasonably expects at the time of acquisition to hold for a period not to exceed five (5) years from the date of acquisition.

E.

Other assets, upon written agreement of all Holders of the RVMTP Shares ("Holders") that such assets are eligible for purchase by the Holders.

F.

Shares of any investment company registered under the 1940 Act sub-classified as a "closed-end company" pursuant to Section 5(a)(2) of the 1940 Act that has adopted and disclosed an investment policy to invest, under normal circumstances, at least 80% of the value of its Assets (as defined in Rule 35d-1 under the 1940 Act) in municipal securities.

G.

Shares of any investment company registered under the 1940 Act sub-classified as an "open-end company" pursuant to Section 5(a)(1) of the 1940 Act that has adopted and disclosed in its registration statement an investment policy to invest, under normal circumstances, at least 80% of the value of its Assets (as defined in Rule 35d-1 under the 1940 Act) in municipal securities.

2.

The Investment Manager has instituted policies and procedures that it believes are sufficient to ensure that the Issuer and it comply with the representations, warranties and covenants contained in this Exhibit B to the Agreement.

3.

The Issuer will, upon request, provide the Holder(s) and their internal and external auditors and inspectors as the Holder(s) may from time to time designate, with all reasonable assistance and access to information and records of the Issuer relevant to the Issuer’s compliance with and performance of the representations, warranties and covenants contained in this Exhibit B to the Agreement, but only for the purposes of internal and external audit.

Date:
			Name of Transferee (use exact name in which Transferred Shares are to be registered):
			Authorized Signature
			Print Name and Title
			Address of Transferee for Registration of Transferred Shares:
			Transferee's taxpayer identification number:

CUSIP	Portfolio Name	Description	Market Value	Par Value	Rating	State
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