Pioneer Tax Advantaged Balanced Trust
(a Delaware statutory trust)
Common Shares of Beneficial Interest
(No Par Value)
PURCHASE AGREEMENT
[ ], 2004
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
Advest, Inc.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated
J.J.B. ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, Inc.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated
Quick & ▇▇▇▇▇▇, Inc.
SunTrust Capital Markets, Inc.
c/o Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Pioneer Tax Advantaged Balanced Trust, a Delaware statutory trust (the
"Trust"), and the Trust's investment adviser, Pioneer Investment Management,
Inc., a Delaware corporation (the "Investment Adviser"), confirm their agreement
with ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
("▇▇▇▇▇▇▇ ▇▇▇▇▇"), RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc., Advest, Inc., ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co.
Incorporated, J.J.B. ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, Inc., ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC,
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated, Quick & ▇▇▇▇▇▇, Inc., SunTrust Capital
Markets, Inc. and each of the other Underwriters named in Schedule A hereto
(collectively, the "Underwriters," which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof), for whom ▇▇▇▇▇▇▇
▇▇▇▇▇, RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc., Advest, Inc., ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated,
J.J.B. ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, Inc., ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, Incorporated, Quick & ▇▇▇▇▇▇, Inc., and SunTrust Capital Markets, Inc.
are acting as representatives (in such capacity, the "Representatives"), with
respect to the issue and sale by the Trust and the purchase by the Underwriters,
acting severally and not jointly, of the respective number of common shares of
beneficial interest, no par value, of the Trust ("Common Shares") set forth in
said Schedule A, and with respect to the grant by the Trust to the Underwriters,
acting severally and not jointly, of the option described in Section 2(b) hereof
to purchase all or any part of [ ] additional Common Shares for the purpose
of covering overallotments, if any. The aforesaid [ ] Common Shares (the
"Initial Securities") to be purchased by the Underwriters and all or any part of
the [ ] Common Shares subject to the option described in Section 2(b) hereof
(the "Option Securities") are hereinafter called, collectively, the
"Securities."
The Trust understands that the Underwriters propose to make a public
offering of the Securities as soon as the Representatives deem advisable after
this Agreement has been executed and delivered.
The Trust has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form N-2 (No. 333-109797 and No.
811-21448) covering the registration of the Securities under the Securities Act
of 1933, as amended (the "1933 Act"), including the related preliminary
prospectus or prospectuses, and a notification on Form N-8A of registration of
the Trust as an investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"), and the rules and regulations of the Commission under
the 1933 Act and the 1940 Act (the "Rules and Regulations"). Promptly after
execution and delivery of this Agreement, the Trust will either (i) prepare and
file a prospectus in accordance with the provisions of Rule 430A ("Rule 430A")
of the Rules and Regulations and paragraph (c) or (h) of Rule 497 ("Rule 497")
of the Rules and Regulations or (ii) if the Trust has elected to rely upon Rule
434 ("Rule 434") of the Rules and Regulations, prepare and file a term sheet (a
"Term Sheet") in accordance with the provisions of Rule 434 and Rule 497. The
information included in any such prospectus or in any such Term Sheet, as the
case may be, that was omitted from such registration statement at the time it
became effective but that is deemed to be part of such registration statement at
the time it became effective, if applicable, (a) pursuant to paragraph (b) of
Rule 430A is referred to as "Rule 430A Information" or (b) pursuant to paragraph
(d) of Rule 434 is referred to as "Rule 434 Information." Each prospectus used
before such registration statement became effective, and any prospectus that
omitted, as applicable, the Rule 430A Information or the Rule 434 Information,
that was used after such effectiveness and prior to the execution and delivery
of this Agreement, including in each case any statement of additional
information incorporated therein by reference, is herein called a "preliminary
prospectus." Such registration statement, including the exhibits thereto and
schedules thereto at the time it became effective and including the Rule 430A
Information and the Rule 434 Information, as applicable, is herein called the
"Registration Statement." Any registration statement filed pursuant to Rule
462(b) of the Rules and Regulations is herein referred to as the "Rule 462(b)
Registration Statement," and after such filing the term "Registration Statement"
shall include the Rule 462(b) Registration Statement. The final prospectus in
the form first furnished to the Underwriters for use in connection with the
offering of the Securities, including the statement of additional information
incorporated therein by reference, is herein called the "Prospectus." If Rule
434 is relied on, the term "Prospectus" shall refer to the preliminary
prospectus dated December 23, 2003 together with the Term Sheet and all
references in this Agreement to the date of the Prospectus shall mean the date
of the Term Sheet. For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus, the Prospectus or any Term
Sheet or any amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("▇▇▇▇▇").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Trust and the Investment
Adviser. The Trust and the Investment Adviser jointly and severally represent
and warrant to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agree with each Underwriter, as follows:
(i) Compliance with Registration Requirements. Each of
the Registration Statement and any Rule 462(b) Registration Statement
has become effective under the 1933 Act and no stop order suspending
the effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act, or order of
suspension or revocation of registration pursuant to Section 8(e) of
the 1940 Act, and no proceedings for any such purpose have been
instituted or are pending or, to the knowledge of the Trust or the
Investment Adviser, are
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contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time (and, if any Option Securities
are purchased, at the Date of Delivery), the Registration Statement,
the Rule 462(b) Registration Statement, the notification of Form N-8A
and any amendments and supplements thereto complied and will comply in
all material respects with the requirements of the 1933 Act, the 1940
Act and the Rules and Regulations and did not and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading. Neither the Prospectus nor any amendments or
supplements thereto, at the time the Prospectus or any such amendment
or supplement was issued and at the Closing Time (and, if any Option
Securities are purchased, at the Date of Delivery), included or will
include an untrue statement of a material fact or omitted or will omit
to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading. If Rule 434 is used, the Trust will comply with the
requirements of Rule 434 and the Prospectus shall not be "materially
different", as such term is used in Rule 434, from the prospectus
included in the Registration Statement at the time it became effective.
Each preliminary prospectus and the prospectus filed as part
of the effective Registration Statement or as part of any amendment
thereto, or filed pursuant to Rule 497 under the 1933 Act, complied
when so filed in all material respects with the Rules and Regulations
and each preliminary prospectus and the Prospectus delivered to the
Underwriters for use in connection with this offering was identical to
the electronically transmitted copies thereof filed with the Commission
pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation S-T.
If a Rule 462(b) Registration Statement is required in
connection with the offering and sale of the Securities, the Trust has
complied or will comply with the requirements of Rule 111 under the
1933 Act Regulations relating to the payment of filing fees thereof.
(ii) Independent Accountants. As of the date of the report
of the independent accountants contained in the Registration Statement,
the accountants who certified the statement of assets and liabilities
included in the Registration Statement are independent public
accountants as required by the 1933 Act and the Rules and Regulations.
(iii) Financial Statements. The statement of assets and
liabilities included in the Registration Statement and the Prospectus,
together with the related notes, presents fairly the financial position
of the Trust at the date indicated; said statement has been prepared in
conformity with generally accepted accounting principles ("GAAP").
(iv) Expense Summary. The information set forth in the
Prospectus in the Fee Table has been prepared in accordance with the
requirements of Form N-2 and to the extent estimated or projected, such
estimates or projections are reasonably believed to be attainable and
reasonably based.
(v) No Material Adverse Change. Since the respective
dates as of which information with respect to the Trust is given in the
Registration Statement and the Prospectus, except as otherwise stated
therein and except for changes in the net asset value of the Trust
arising out of normal investment operations, (A) there has been no
material adverse change (except in the case of any Date of Delivery in
connection with Option Securities, for any change in net asset value of
the Trust resulting from investment operations) in the condition,
financial or otherwise, or in the earnings, business affairs or
business prospects of the Trust, whether or not arising in the ordinary
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course of business (a "Material Adverse Effect"), (B) there have been
no transactions entered into by the Trust, other than those in the
ordinary course of business, which are material with respect to the
Trust, and (C) there has been no dividend or distribution of any kind
declared, paid or made by the Trust on any class of its capital shares.
(vi) Good Standing of the Trust. The Trust has been
organized and is validly existing as a statutory trust in good standing
under the laws of the state of Delaware and has power and authority to
own, lease and operate its properties and to conduct its business as
described in the Prospectus and to enter into and perform its
obligations under this Agreement; and the Trust is duly qualified to
transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except
where the failure so to qualify or to be in good standing would not
result in a Material Adverse Effect.
(vii) No Subsidiaries. The Trust has no subsidiaries.
(viii) Investment Company Status. The Trust is registered
with the Commission under the 1940 Act as a closed-end diversified
management investment company, and no order of suspension or revocation
of such registration has been issued or proceedings therefor initiated
or threatened by the Commission.
(ix) Officers and Trustees. No person is serving or acting
as an officer, trustee or investment adviser of the Trust except in
accordance with the provisions of the 1940 Act and the Rules and
Regulations and the Investment Advisers Act of 1940, as amended (the
"Advisers Act"), and the rules and regulations of the Commission
promulgated under the Advisers Act (the "Advisers Act Rules and
Regulations"). Except as disclosed in the Registration Statement and
the Prospectus (or any amendment or supplement to either of them), no
trustee of the Trust is (A) an "interested person" (as defined in the
▇▇▇▇ ▇▇▇) of the Trust or (B) an "affiliated person" (as defined in the
▇▇▇▇ ▇▇▇) of any Underwriter.
(x) Capitalization. The authorized, issued and
outstanding shares of beneficial interest of the Trust as of the date
of the Prospectus are as set forth in the balance sheet included in the
Registration Statement. All issued and outstanding common shares of
beneficial interest of the Trust have been duly authorized and validly
issued and are fully paid and non-assessable and have been offered and
sold or exchanged by the Trust in compliance with all applicable laws
(including, without limitation, federal and state securities laws);
none of the outstanding common shares of beneficial interest of the
Trust were issued in violation of the preemptive or other similar
rights of any securityholder of the Trust.
(xi) Authorization and Description of Securities. The
Securities to be purchased by the Underwriters from the Trust have been
duly authorized for issuance and sale to the Underwriters pursuant to
this Agreement and, when issued and delivered by the Trust pursuant to
this Agreement against payment of the consideration set forth herein,
will be validly issued and fully paid and non-assessable. The Common
Shares conform in all material respects to all statements relating
thereto contained in the Prospectus and such description conforms in
all material respects to the rights set forth in the instruments
defining the same; no holder of the Securities will be subject to
personal liability by reason of being such a holder; and the issuance
of the Securities is not subject to the preemptive or other similar
rights of any securityholder of the Trust.
(xii) Absence of Defaults and Conflicts. The Trust is not
in violation of its agreement and declaration of trust or by-laws, or
in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, deed
4
of trust, loan or credit agreement, note, lease or other agreement or
instrument to which it is a party or by which it may be bound, or to
which any of the property or assets of the Trust is subject
(collectively, "Agreements and Instruments") except for such violations
or defaults that would not result in a Material Adverse Effect; and the
execution, delivery and performance of this Agreement, the Advisory
Agreement, the Administration Agreement, the Custodian Agreement, the
Investment Company Service Agreement and the Expense Limitation
Agreement referred to in the Registration Statement (as used herein,
the "Advisory Agreement," the "Administration Agreement," the
"Custodian Agreement," the "Transfer Agency Agreement" and the "Expense
Limitation Agreement," respectively) and the consummation of the
transactions contemplated herein and in the Registration Statement
(including the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the Prospectus
under the caption "Use of Proceeds") and compliance by the Trust with
its obligations hereunder have been duly authorized by all necessary
corporate action and do not and will not, whether with or without the
giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined
below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Trust pursuant
to, the Agreements and Instruments (except for such conflicts, breaches
or defaults or liens, charges or encumbrances that would not result in
a Material Adverse Effect), nor will such action result in any
violation of the provisions of the declaration of trust or by-laws of
the Trust, or any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over the Trust or any
of its assets, properties or operations. As used herein, a "Repayment
Event" means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on
such holder's behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the Trust.
(xiii) Absence of Proceedings. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to
the knowledge of the Trust or the Investment Adviser, threatened,
against or affecting the Trust, which is required to be disclosed in
the Registration Statement (other than as disclosed therein), or which
might reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect
the properties or assets of the Trust or the consummation of the
transactions contemplated in this Agreement or the performance by the
Trust of its obligations hereunder. The aggregate of all pending legal
or governmental proceedings to which the Trust is a party or of which
any of its property or assets is the subject which are not described in
the Registration Statement, including ordinary routine litigation
incidental to the business, could not reasonably be expected to result
in a Material Adverse Effect.
(xiv) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits thereto by the
1933 Act, the 1940 Act or by the Rules and Regulations which have not
been so described and filed as required.
(xv) Possession of Intellectual Property. The Trust owns
or possesses, or can acquire on reasonable terms, adequate patents,
patent rights, licenses, inventions, copyrights, know-how (including
trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service
marks, trade names or other intellectual property (collectively,
"Intellectual Property") necessary to carry on the business now
operated by the Trust, and the Trust has not received any notice or is
not otherwise aware of any infringement of or conflict with asserted
rights of others with respect to any Intellectual Property or of any
facts or circumstances which would render any Intellectual Property
invalid or inadequate to
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protect the interest of the Investment Adviser therein, and which
infringement or conflict (if the subject of any unfavorable decision,
ruling or finding) or invalidity or inadequacy, singly or in the
aggregate, would result in a Material Adverse Effect.
(xvi) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the performance by the Trust of its
obligations hereunder, in connection with the offering, issuance or
sale of the Securities hereunder or the consummation of the
transactions contemplated by this Agreement, except such as have been
already obtained or as may be required under the 1933 Act, the 1940
Act, the Securities Exchange Act of 1934, as amended (the "1934 Act")
or state securities laws.
(xvii) Possession of Licenses and Permits. The Trust
possesses such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or
bodies necessary to operate its properties and to conduct the business
as contemplated in the Prospectus; the Trust is in compliance with the
terms and conditions of all such Governmental Licenses, except where
the failure so to comply would not, singly or in the aggregate, have a
Material Adverse Effect; all of the Governmental Licenses are valid and
in full force and effect, except when the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not have a Material Adverse Effect;
and the Trust has not received any notice of proceedings relating to
the revocation or modification of any such Governmental Licenses which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a Material Adverse Effect.
(xviii) Advertisements. Any advertising, sales literature or
other promotional material (including "prospectus wrappers," "broker
kits," "road show slides" and "road show scripts") authorized in
writing by or prepared by the Trust or the Investment Adviser used in
connection with the public offering of the Securities (collectively,
"sales material") does not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
in which they were made, not misleading. Moreover, all sales material
complied and will comply in all material respects with the applicable
requirements of the 1933 Act, the 1940 Act and the Rules and
Regulations and the rules and interpretations of the National
Association of Securities Dealers, Inc. ("NASD").
(xix) Subchapter M. The Trust intends to direct the
investment of the proceeds of the offering described in the
Registration Statement in such a manner as to comply with the
requirements of Subchapter M of the Internal Revenue Code of 1986, as
amended ("Subchapter M of the Code" and the "Code," respectively), and
intends to qualify as a regulated investment company under Subchapter M
of the Code.
(xx) Distribution of Offering Materials. The Trust has not
distributed and, prior to the later to occur of (A) the Closing Time
and (B) completion of the distribution of the Common Shares, will not
distribute any offering material in connection with the offering and
sale of the Common Shares other than the Registration Statement,
preliminary prospectuses, the Prospectus or the sales materials.
(xxi) Accounting Controls. The Trust maintains a system of
internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance with
management's general or specific authorization and with the applicable
requirements of the 1940 Act, the Rules and Regulations and the Code;
(B) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally
6
accepted accounting principles and to maintain accountability for
assets and to maintain compliance with the books and records
requirements under the 1940 Act and the Rules and Regulations; (C)
access to assets is permitted only in accordance with the management's
general or specific authorization; and (D) the recorded accountability
for assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xxii) Absence of Undisclosed Payments. To the Trust's
knowledge, neither the Trust nor any employee or agent of the Trust has
made any payment of funds of the Trust or received or retained any
funds, which payment, receipt or retention of funds is of a character
required to be disclosed in the Prospectus.
(xxiii) Material Agreements. This Agreement, the Advisory
Agreement, the Administration Agreement, the Custodian Agreement, the
Transfer Agency Agreement and the Expense Limitation Agreement have
each been duly authorized by all requisite action on the part of the
Trust, executed and delivered by the Trust, as of the dates noted
therein and each complies with all applicable provisions of the 1940
Act. Assuming due authorization, execution and delivery by the other
parties thereto, each such agreement constitutes a valid and binding
agreement of the Trust, enforceable in accordance with its terms,
except as affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) and an implied
covenant of good faith and fair dealing.
(xxiv) Registration Rights. There are no persons with
registration rights or other similar rights to have any securities of
the Trust registered pursuant to the Registration Statement or
otherwise registered by the Trust under the 1933 Act.
(xxv) NYSE Listing. The Securities have been duly
authorized for listing, upon notice of issuance, on the New York Stock
Exchange ("NYSE") and the Trust's registration statement on Form 8-A
under the 1934 Act has become effective.
(b) Representations and Warranties by the Investment Adviser. The
Investment Adviser represents and warrants to each Underwriter as of the date
hereof, as of the Closing Time referred to in Section 2(c) hereof, and as of
each Date of Delivery (if any) referred to in Section 2(b) hereof as follows:
(i) Good Standing of the Investment Adviser. The
Investment Adviser has been duly organized and is validly existing and
in good standing as a corporation under the laws of the state of
Delaware, with full corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and it is duly qualified as a foreign corporation to
transact business and is in good standing in each other jurisdiction in
which such qualification is required.
(ii) Investment Adviser Status. The Investment Adviser is
duly registered with the Commission as an investment adviser under the
Advisers Act, and is not prohibited by the Advisers Act or the 1940
Act, or the rules and regulations under such acts, from acting under
the Advisory Agreement for the Trust as contemplated by the Prospectus.
(iii) Description of the Investment Adviser. The
description of the Investment Adviser in the Registration Statement and
the Prospectus (and any amendment or supplement to either of them)
complied and comply in all material respects with the provisions of the
1933 Act, the 1940 Act, the Advisers Act, the Rules and Regulations and
the Advisers Act Rules and Regulations and is true and correct and does
not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under
which they were made, not misleading.
7
(iv) Capitalization. The Investment Adviser has the
financial resources available to it necessary for the performance of
its services and obligations as contemplated in the Prospectus, this
Agreement and under the Advisory Agreement.
(v) Authorization of Agreements; Absence of Defaults and
Conflicts. This Agreement and the Advisory Agreement have each been
duly authorized, executed and delivered by the Investment Adviser, and
the Advisory Agreement constitutes a valid and binding obligation of
the Investment Adviser, enforceable in accordance with its terms,
except as affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and general equitable principles
(whether considered in a proceeding in equity or at law); and neither
the execution and delivery of this Agreement or the Advisory Agreement
nor the performance by the Investment Adviser of its obligations
hereunder or thereunder will conflict with, or result in a breach of
any of the terms and provisions of, or constitute, with or without the
giving of notice or lapse of time or both, a default under, any
agreement or instrument to which the Investment Adviser is a party or
by which it is bound and which is material to the conduct of the
Investment Adviser's services under the Advisory Agreement, the
certificate of incorporation, the by laws or other organizational
documents of the Investment Adviser, or to the Investment Adviser's
knowledge, by any law, order, decree, rule or regulation applicable to
it of any jurisdiction, court, federal or state regulatory body,
administrative agency or other governmental body, stock exchange or
securities association having jurisdiction over the Investment Adviser
or its properties or operations; and no consent, approval,
authorization or order of any court or governmental authority or agency
is required for the consummation by the Investment Adviser of the
transactions contemplated by this Agreement or the Advisory Agreement,
except as have been obtained or may be required under the 1933 Act, the
1940 Act, the 1934 Act, NYSE or state securities laws.
(vi) No Material Adverse Change. Since the respective
dates as of which information with respect to the Adviser is given in
the Registration Statement and the Prospectus, except as otherwise
stated therein, there has not occurred any event which should
reasonably be expected to have a material adverse effect on the ability
of the Investment Adviser to perform its obligations under this
Agreement and the Advisory Agreement.
(vii) Absence of Proceedings. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to
the knowledge of the Investment Adviser, threatened against or
affecting either the Investment Adviser or any "affiliated person" of
the Investment Adviser (as such term is defined in the ▇▇▇▇ ▇▇▇) or any
partners, directors, officers or employees of the foregoing, whether or
not arising in the ordinary course of business, which should reasonably
be expected to result in any material adverse change in the condition,
financial or otherwise, or earnings, business affairs or business
prospects of the Investment Adviser, materially and adversely affect
the properties or assets of the Investment Adviser or materially impair
or adversely affect the ability of the Investment Adviser to function
as an investment adviser or perform its obligations under the Advisory
Agreement, or which is required to be disclosed in the Registration
Statement and the Prospectus (and has not been so disclosed).
(viii) Absence of Violation or Default. The Investment
Adviser is not in violation of its organizational documents or in
default under any agreement, indenture or instrument, where such
violation or default should reasonably be expected to have a material
adverse effect on the ability of the Investment Adviser to perform its
obligations under the Advisory Agreement.
(c) Officer's Certificates. Any certificate signed by any officer
of the Trust or the Investment Adviser delivered to the Representatives or to
counsel for the Underwriters shall be deemed a
8
representation and warranty by the Trust or the Investment Adviser, as the case
may be, to each Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Trust agrees to sell to each Underwriter, severally and not jointly,
and each Underwriter, severally and not jointly, agrees to purchase from the
Trust, at the price per share set forth in Schedule B, the number of Initial
Securities set forth in Schedule A opposite the name of such Underwriter, plus
any additional number of Initial Securities which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof.
(b) Option Securities. In addition, on the basis of the
representations and warranties herein contained and subject to the terms and
conditions herein set forth, the Trust hereby grants an option to the
Underwriters, severally and not jointly, to purchase up to an additional [ ]
Common Shares in the aggregate at the price per share set forth in Schedule B,
less an amount per share equal to any dividends or distributions declared by the
Trust and payable on the Initial Securities but not payable on the Option
Securities. The option hereby granted will expire 45 days after the date hereof
and may be exercised in whole or in part from time to time only for the purpose
of covering overallotments which may be made in connection with the offering and
distribution of the Initial Securities upon written notice by the
Representatives to the Trust setting forth the number of Option Securities as to
which the several Underwriters are then exercising the option and the time and
date of payment and delivery for such Option Securities. Any such time and date
of delivery (a "Date of Delivery") shall be determined by the Representatives,
but shall not be earlier than the third day after the date on which the option
is being exercised nor later than seven full business days after the exercise of
said option, nor in any event prior to the Closing Time, as hereinafter defined.
If the option is exercised as to all or any portion of the Option Securities,
each of the Underwriters, acting severally and not jointly, will purchase that
proportion of the total number of Option Securities then being purchased which
the number of Initial Securities set forth in Schedule A opposite the name of
such Underwriter bears to the total number of Initial Securities, subject in
each case to such adjustments as ▇▇▇▇▇▇▇ ▇▇▇▇▇ in its discretion shall make to
eliminate any sales or purchases of a fractional number of Option Securities
plus any additional number of Option Securities which such Underwriter may
become obligated to purchase pursuant to the provisions of Section 10 hereof.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
▇▇▇▇▇▇▇▇ Chance US LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such
other place as shall be agreed upon by the Representatives and the Trust, at
10:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs after 4:30
P.M. (Eastern time) on any given day) business day after the date hereof (unless
postponed in accordance with the provisions of Section 10), or such other time
not later than ten business days after such date as shall be agreed upon by the
Representatives and the Trust (such time and date of payment and delivery being
herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representatives
and the Trust, on each Date of Delivery as specified in the notice from the
Representatives to the Trust.
Payment shall be made to the Trust by wire transfer of immediately
available funds to a bank account designated by the Trust, against delivery to
the Representatives for the respective accounts of the Underwriters of
certificates for the Securities to be purchased by them. It is understood that
each Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and
9
make payment of the purchase price for, the Initial Securities and the Option
Securities, if any, which it has agreed to purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇, individually
and not as representative of the Underwriters, may (but shall not be obligated
to) make payment of the purchase price for the Initial Securities or the Option
Securities, if any, to be purchased by any Underwriter whose funds have not been
received by the Closing Time or the relevant Date of Delivery, as the case may
be, but such payment shall not relieve such Underwriter from its obligations
hereunder.
(d) Denominations; Registration. Certificates for the Initial
Securities and the Option Securities, if any, shall be in such denominations and
registered in such names as the Representatives may request in writing at least
one full business day before the Closing Time or the relevant Date of Delivery,
as the case may be. The certificates for the Initial Securities and the Option
Securities, if any, will be made available for examination and packaging by the
Representatives in the City of New York not later than 10:00 A.M. (Eastern time)
on the business day prior to the Closing Time or the relevant Date of Delivery,
as the case may be.
SECTION 3. Covenants.
(a) The Trust and the Investment Adviser, jointly and severally,
covenant with each Underwriter as follows:
(i) Compliance with Securities Regulations and Commission
Requests. The Trust, subject to Section 3(a)(ii), will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify
the Representatives immediately, and confirm the notice in writing, (i)
when any post-effective amendment to the Registration Statement shall
become effective, or any supplement to the Prospectus or any amended
Prospectus shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement
to the Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing
or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the Securities for offering or sale
in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes. The Trust will promptly effect
the filings necessary pursuant to Rule 497 and will take such steps as
it deems necessary to ascertain promptly whether the form of prospectus
transmitted for filing under Rule 497 was received for filing by the
Commission and, in the event that it was not, it will promptly file
such prospectus. The Trust will make every reasonable effort to prevent
the issuance of any stop order, or order of suspension or revocation of
registration pursuant to Section 8(e) of the 1940 Act, and, if any such
stop order or order of suspension or revocation of registration is
issued, to obtain the lifting thereof at the earliest possible moment.
(ii) Filing of Amendments. The Trust will give the
Representatives notice of its intention to file or prepare any
amendment to the Registration Statement (including any filing under
Rule 462(b)), any Term Sheet or any amendment, supplement or revision
to either the prospectus included in the Registration Statement at the
time it became effective or to the Prospectus, will furnish the
Representatives with copies of any such documents a reasonable amount
of time prior to such proposed filing or use, as the case may be, and
will not file or use any such document to which the Representatives or
counsel for the Underwriters shall object.
(iii) Delivery of Registration Statements. The Trust has
furnished or will deliver to the Representatives and counsel for the
Underwriters, without charge, signed copies of the Registration
Statement as originally filed and of each amendment thereto (including
exhibits filed therewith or incorporated by reference therein) and
signed copies of all consents and certificates of experts, and will
also deliver to the Representatives, without charge, a conformed copy
of the
10
Registration Statement as originally filed and of each amendment
thereto (without exhibits) for each of the Underwriters. The copies of
the Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the
extent permitted by Regulation S-T.
(iv) Delivery of Prospectuses. The Trust has delivered to
each Underwriter, without charge, as many copies of each preliminary
prospectus as such Underwriter reasonably requested, and the Trust
hereby consents to the use of such copies for purposes permitted by the
1933 Act. The Trust will furnish to each Underwriter, without charge,
during the period when the Prospectus is required to be delivered under
the 1933 Act or the 1934 Act, such number of copies of the Prospectus
(as amended or supplemented) as such Underwriter may reasonably
request. The Prospectus and any amendments or supplements thereto
furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇,
except to the extent permitted by Regulation S-T.
(v) Continued Compliance with Securities Laws. If at any
time when a prospectus is required by the 1933 Act to be delivered in
connection with sales of the Securities, any event shall occur or
condition shall exist as a result of which it is necessary, in the
opinion of counsel for the Underwriters or for the Trust, to amend the
Registration Statement or amend or supplement the Prospectus in order
that the Prospectus will not include any untrue statements of a
material fact or omit to state a material fact necessary in order to
make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or
if it shall be necessary, in the opinion of such counsel, at any such
time to amend the Registration Statement or amend or supplement the
Prospectus in order to comply with the requirements of the 1933 Act or
the Rules and Regulations, the Trust will promptly prepare and file
with the Commission, subject to Section 3(a)(ii), such amendment or
supplement as may be necessary to correct such statement or omission or
to make the Registration Statement or the Prospectus comply with such
requirements, and the Trust will furnish to the Underwriters such
number of copies of such amendment or supplement as the Underwriters
may reasonably request.
(vi) Blue Sky Qualifications. The Trust will use its best
efforts, in cooperation with the Underwriters, to qualify the
Securities for offering and sale under the applicable securities laws
of such states and other jurisdictions of the United States as the
Representatives may designate and to maintain such qualifications in
effect for a period of not less than one year from the later of the
effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that the Trust shall not be
obligated to file any general consent to service of process or to
qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it
is not otherwise so subject. In each jurisdiction in which the
Securities have been so qualified, the Trust will file such statements
and reports as may be required by the laws of such jurisdiction to
continue such qualification in effect for a period of not less than one
year from the effective date of the Registration Statement and any Rule
462(b) Registration Statement.
(vii) Rule 158. The Trust will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated
by, the last paragraph of Section 11(a) of the 1933 Act.
(viii) Use of Proceeds. The Trust will use the net proceeds
received by it from the sale of the Securities in the manner specified
in the Prospectus under "Use of Proceeds".
11
(ix) Listing. The Trust will use its reasonable efforts to
effect the listing of the Securities on the NYSE, subject to notice of
issuance, concurrently with the effectiveness of the Registration
Statement.
(x) Restriction on Sale of Securities. During a period of
180 days from the date of the Prospectus, the Trust will not, without
the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, (A) directly or indirectly,
offer, pledge, sell, contract to sell, sell any option, rights or
warrant to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase or otherwise transfer or dispose
of Common Shares or any securities convertible into or exercisable or
exchangeable for Common Shares or file any registration statement under
the 1933 Act with respect to any of the foregoing or (B) enter into any
swap or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence of
ownership of the Common Shares, whether any such swap or transaction
described in clause (A) or (B) above is to be settled by delivery of
Common Shares or such other securities, in cash or otherwise. The
foregoing sentence shall not apply to (1) the Securities to be sold
hereunder or (2) Common Shares issued or purchased in the open market
pursuant to any dividend reinvestment plan.
(xi) Reporting Requirements. The Trust, during the period
when the Prospectus is required to be delivered under the 1933 Act or
the 1934 Act, will file all documents required to be filed with the
Commission pursuant to the 1940 Act and the 1934 Act within the time
periods required by the 1940 Act and the Rules and Regulations and the
1934 Act and the rules and regulations of the Commission thereunder,
respectively.
(xii) Subchapter M. The Trust will comply with the
requirements of Subchapter M of the Code to qualify as a regulated
investment company under the Code.
(xiii) No Manipulation of Market for Securities. The Trust
will not (a) take, directly or indirectly, any action designed to cause
or to result in, or that might reasonably be expected to constitute,
the stabilization or manipulation of the price of any security of the
Trust to facilitate the sale or resale of the Securities, and (b) until
the Closing Date, or the Date of Delivery, if any, (i) sell, bid for or
purchase the Securities or pay any person any compensation for
soliciting purchases of the Securities or (ii) pay or agree to pay to
any person any compensation for soliciting another to purchase any
other securities of the Trust.
(xiv) Rule 462(b) Registration Statement. If the Trust
elects to rely upon Rule 462(b), the Trust shall file a Rule 462(b)
Registration Statement with the Commission in compliance with Rule
462(b) by 10:00 P.M., Washington, D.C. time, on the date of this
Agreement, and the Trust shall at the time of filing either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or
give irrevocable instructions for the payment of such fee pursuant to
Rule 111(b) under the 1933 Act.
(b) The Investment Adviser covenants that for a period of 180 days
from the date of the Prospectus, the Investment Adviser will not, without
▇▇▇▇▇▇▇ ▇▇▇▇▇'▇ prior written consent which consent shall not be unreasonably
withheld, enter into an agreement pursuant to which the Investment Adviser acts
as investment adviser to any other U.S. closed-end registered investment company
having an investment objective, policies and restrictions substantially similar
to those of the Trust.
SECTION 4. Payment of Expenses.
(a) Expenses. The Trust will pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the preparation, printing and delivery to the Underwriters of this
Agreement, any Agreement among
12
Underwriters and such other documents as may be required in connection with the
offering, purchase, sale, issuance or delivery of the Securities, (iii) the
preparation, issuance and delivery of the certificates for the Securities to the
Underwriters, including any stock or other transfer taxes and any stamp or other
duties payable upon the sale, issuance or delivery of the Securities to the
Underwriters, (iv) the fees and disbursements of the Trust's counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(a)(vi) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus,
Prospectus and any amendments or supplements thereto, (vii) the preparation,
printing and delivery to the Underwriters of copies of the Blue Sky Survey and
any supplement thereto, (viii) the fees and expenses of any transfer agent or
registrar for the Securities, (ix) the filing fees incident to, and the
reasonable fees and disbursements of counsel to the Underwriters in connection
with, the review by the NASD of the terms of the sale of the Securities, (x) the
fees and expenses incurred in connection with the listing of the Securities on
the NYSE and (xi) the printing of any sales material. Also, the Trust shall pay
the Underwriters $.005 per common share as partial reimbursement of expenses
incurred in connection with the offering. The amount paid by the Trust as this
partial reimbursement to the Underwriters will not exceed .03335% of the total
price to the public of the Common Shares sold in this offering. The Investment
Adviser has agreed to pay organizational expenses and offering costs (other than
sales load, but including the partial reimbursement of expenses described above)
of the Trust that exceed $.03 per Common Share. The sum total of all
compensation received by the Underwriters in connection with this offering,
including sales load and all forms of compensation to and reimbursement of
Underwriters, will not exceed 9.0% of the total price to the public of the
Common Shares sold in this offering.
(b) Termination of Agreement. If this Agreement is terminated by
the Representatives in accordance with the provisions of Section 5 or Section
9(a) hereof, the Trust and the Investment Adviser, jointly and severally, agree
that they shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Underwriters.
SECTION 5. Conditions of Underwriters' Obligations.
The obligations of the several Underwriters hereunder are subject to
the accuracy of the representations and warranties of the Trust and the
Investment Adviser contained in Section 1 hereof or in certificates of any
officer of the Trust or the Investment Adviser delivered pursuant to the
provisions hereof, to the performance by the Trust and the Investment Adviser of
their respective covenants and other obligations hereunder, and to the following
further conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective or will have become effective by 5:30 p.m., New York City time on the
date hereof, and at Closing Time no stop order suspending the effectiveness of
the Registration Statement shall have been issued under the 1933 Act, no notice
or order pursuant to Section 8(e) of the 1940 Act shall have been issued, and no
proceedings with respect to either shall have been initiated or threatened by
the Commission, and any request on the part of the Commission for additional
information shall have been complied with or waived to the reasonable
satisfaction of counsel to the Underwriters. A prospectus containing the Rule
430A Information shall have been filed with the Commission in accordance with
Rule 497 (or a post-effective amendment providing such information shall have
been filed and declared effective in accordance with the requirements of Rule
430A or a certificate must have been filed in accordance with Rule 497(j)) or,
if the Trust has elected to rely upon Rule 434, a Term Sheet shall have been
filed with the Commission in accordance with Rule 497.
(b) Opinion of Counsel for Trust and the Investment Adviser. At
Closing Time, the Representatives shall have received the favorable opinion,
dated as of Closing Time, of ▇▇▇▇ & ▇▇▇▇ LLP, counsel for the Trust and the
Investment Adviser, in form and substance satisfactory to counsel for the
13
Underwriters, together with signed or reproduced copies of such letter for each
of the other Underwriters to the effect set forth in Exhibit A hereto and to
such further effect as counsel to the Underwriters may reasonably request.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of ▇▇▇▇▇▇▇▇ Chance US LLP, counsel for the Underwriters, together with
signed or reproduced copies of such letter for each of the other Underwriters
with respect to the matters set forth in clauses 1, 3, 4, 5 (solely as to
preemptive or other similar rights arising by operation of law or under the
charter or by-laws of the Trust), 6, 8 (solely as to the information in the
Prospectus under "Description of Shares"), 14 and the second to last paragraph
of Exhibit A hereto. In giving such opinion such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the state of
New York and the federal law of the United States, upon the opinions of counsel
satisfactory to the Representatives. Such counsel may also state that, insofar
as such opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Trust and certificates of
public officials.
(d) Officers' Certificates. At Closing Time, there shall not have
been, since the date hereof or since the respective dates as of which
information is given in the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Trust, whether or not arising in the ordinary course
of business (except, in the case of any Officer's Certificate delivered on any
Date of Delivery in connection with any Option Securities, for any change in the
net asset value of the Trust resulting from its investment operations), and the
Representatives shall have received a certificate of a duly authorized officer
of the Trust and of the chief financial or chief accounting officer of the Trust
and of the President or a Vice President of the Investment Adviser, dated as of
Closing Time, to the effect that (i) there has been no such material adverse
change, (ii) the representations and warranties in Sections 1(a) and (b) hereof,
as applicable, are true and correct with the same force and effect as though
expressly made at and as of Closing Time, (iii) each of the Trust and the
Investment Adviser, respectively, has complied with all agreements and satisfied
all conditions on its part to be performed or satisfied at or prior to Closing
Time, and (iv) no stop order suspending the effectiveness of the Registration
Statement, or order of suspension or revocation of registration pursuant to
Section 8(e) of the 1940 Act, has been issued and no proceedings for any such
purpose have been instituted or are pending or are contemplated by the
Commission.
(e) Accountant's Comfort Letter. At the time of the execution of
this Agreement, the Representatives shall have received from Ernst & Young LLP a
letter dated such date, in form and substance satisfactory to the
Representatives, together with signed or reproduced copies of such letter for
each of the other Underwriters containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
(f) Bring-down Comfort Letter. At Closing Time, the
Representatives shall have received from Ernst & Young LLP a letter, dated as of
Closing Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (e) of this Section, except that the specified
date referred to shall be a date not more than three business days prior to
Closing Time.
(g) Approval of Listing. At Closing Time, the Securities shall
have been approved for listing on the NYSE, subject only to official notice of
issuance.
(h) No Objection. The NASD has confirmed that it has not raised
any objection with respect to the fairness and reasonableness of the
underwriting terms and arrangements.
(i) Conditions to Purchase of Option Securities. In the event that
the Underwriters exercise their option provided in Section 2(b) hereof to
purchase all or any portion of the Option Securities, the
14
representations and warranties of the Trust contained herein and the statements
in any certificates furnished by the Trust hereunder shall be true and correct
as of each Date of Delivery and, at the relevant Date of Delivery, the
Representatives shall have received:
(i) Officers' Certificates. Certificates, dated such Date
of Delivery, of a duly authorized officer of the Trust and of the chief
financial or chief accounting officer of the Trust and of the President
or a Vice President of the Investment Adviser confirming that the
information contained in the certificate delivered by each of them at
the Closing Time pursuant to Section 5(d) hereof remains true and
correct as of such Date of Delivery.
(ii) Opinions of Counsel for the Trust and the Investment
Adviser. The favorable opinion of counsel for the Trust and the
Investment Adviser, in form and substance satisfactory to counsel for
the Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(b) hereof.
(iii) Opinion of Counsel for the Underwriters. The
favorable opinion of ▇▇▇▇▇▇▇▇ Chance US LLP, counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(c) hereof.
(iv) Bring-down Comfort Letter. A letter from Ernst &
Young LLP, in form and substance satisfactory to the Representatives
and dated such Date of Delivery, substantially in the same form and
substance as the letter furnished to the Representatives pursuant to
Section 5(f) hereof, except that the "specified date" in the letter
furnished pursuant to this paragraph shall be a date not more than five
days prior to such Date of Delivery.
(j) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the Underwriters shall have been furnished with such
documents and opinions as they may reasonably require for the purpose of
enabling them to pass upon the issuance and sale of the Securities as herein
contemplated, or in order to evidence the accuracy of any of the representations
or warranties, or the fulfillment of any of the conditions, herein contained;
and all proceedings taken by the Trust and the Investment Adviser in connection
with the organization and registration of the Trust under the 1940 Act and the
issuance and sale of the Securities as herein contemplated shall be satisfactory
in form and substance to the Representatives and counsel for the Underwriters.
(k) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option
Securities, on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant Option
Securities, may be terminated by the Representatives by notice to the Trust at
any time at or prior to Closing Time or such Date of Delivery, as the case may
be, and such termination shall be without liability of any party to any other
party except as provided in Section 4 and except that Sections 1, 6, 7, 8 and 13
shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. The Trust and the Investment
Adviser, jointly and severally, agree to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, as follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact
15
contained in the Registration Statement (or any amendment thereto),
including the Rule 430A Information and the Rule 434 Information, if
applicable, or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to make the statements
therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact included in any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto),
or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided
that (subject to Section 6(e) below) any such settlement is effected
with the written consent of the Trust; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇
▇▇▇▇▇), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Trust or the
Investment Adviser by any Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in
the Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) and
provided further that the Trust will not be liable to any Underwriter with
respect to any indemnification contained in this paragraph (a) to the extent
that the Trust shall sustain the burden of proving that any such loss,
liability, claim, damage or expense resulted from the fact that such
Underwriter, in contravention of a requirement of this Agreement or applicable
law, sold Securities to a person to whom such Underwriter failed to send or
give, at or prior to the Closing Time or the Date of Delivery, as the case may
be, a copy of the Prospectus, as then amended or supplemented if: (i) the Trust
has previously furnished copies thereof (sufficiently in advance of the Closing
Time or the Date of Delivery, as the case may be, to allow for distribution by
the Closing Time or the Date of Delivery, as the case may be) to the Underwriter
and the loss, liability, claim, damage or expense of such Underwriter resulted
from an untrue statement or omission of a material fact contained in or omitted
from the preliminary prospectus which was corrected in the Prospectus as, if
applicable, amended or supplemented prior to the Closing Time or the Date of
Delivery, as the case may be, and such Prospectus was required by law to be
delivered at or prior to the written confirmation of sale to such person and
(ii) the failure to give or send such Prospectus by the Closing Time or the Date
of Delivery, as the case may be, to such person would have constituted the sole
basis for the claim asserted by such person against the party or parties
asserting such loss, liability, claim, damage or expense as to which
indemnification is sought pursuant to this paragraph (a).
(b) Indemnification of the Trust, Investment Adviser, Trustees,
Directors and Officers. Each Underwriter severally agrees to indemnify and hold
harmless the Trust and the Investment Adviser, their respective trustees and
directors, each of the Trust's officers who signed the Registration Statement,
and each person, if any, who controls the Trust or the Investment Adviser within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against
any and all loss, liability, claim, damage and expense
16
described in the indemnity contained in subsection (a) of this Section, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and the Rule 434
Information, if applicable, or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Trust or the Investment Adviser by such
Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, or such preliminary prospectus or the Prospectus (or
any amendment or supplement thereto).
(c) Indemnification for Marketing Materials. In addition to the
foregoing indemnification, the Trust and the Investment Adviser also, jointly
and severally, agree to indemnify and hold harmless each Underwriter and each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act, against any and all loss, liability,
claim, damage and expense described in the indemnity contained in Section 6(a),
as limited by the proviso set forth therein, with respect to any sales material.
(d) Actions against Parties; Notification. Each indemnified party
shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof and in any event shall not relieve
it from any liability which it may have otherwise than on account of this
indemnity agreement. In the case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the commencement
of such action, the indemnifying party shall be entitled to participate therein
and, to the extent that it shall wish, to assume the defense thereof with
counsel satisfactory to such indemnified party, and after notice from the
indemnifying party to the indemnified party of its election to assume the
defense thereof, the indemnifying party shall not be liable to the indemnified
party for any legal expenses of other counsel or any other expenses, in each
case subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation. In any such action
where the indemnifying party does not assume the defense thereof, counsel to the
indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇ in the case of parties
indemnified pursuant to Section 6(a) above, and, in the case of parties
indemnified pursuant to Section 6(b) above, counsel to the indemnified parties
shall be selected by the Trust and the Investment Adviser, and in both cases, an
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(e) Settlement without Consent if Failure to Reimburse. If at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 6(a)(ii) effected without its written consent if
(i) such settlement is entered into
17
more than 60 days after receipt by such indemnifying party of the aforesaid
request, (ii) such indemnifying party shall have received notice of the terms of
such settlement at least 30 days prior to such settlement being entered into and
(iii) such indemnifying party shall not have reimbursed such indemnified party
in accordance with such request prior to the date of such settlement.
SECTION 7. Contribution.
If the indemnification provided for in Section 6 hereof is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Trust and the Investment Adviser
on the one hand and the Underwriters on the other hand from the offering of the
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Trust and the Investment Adviser on the
one hand and of the Underwriters on the other hand in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Trust and the Investment Adviser
on the one hand and the Underwriters on the other hand in connection with the
offering of the Securities pursuant to this Agreement shall be deemed to be in
the same respective proportions as the total net proceeds from the offering of
the Securities pursuant to this Agreement (before deducting expenses) received
by the Trust and the total underwriting discount received by the Underwriters
(whether from the Trust or otherwise), in each case as set forth on the cover of
the Prospectus, or, if Rule 434 is used, the corresponding location on the Term
Sheet, bear to the aggregate initial public offering price of the Securities as
set forth on such cover.
The relative fault of the Trust and the Investment Adviser on the one
hand and the Underwriters on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Trust or the Investment Adviser or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The Trust, the Investment Adviser and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this Section
7. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7 shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
18
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each trustee of the Trust and each director of the Investment Adviser,
respectively, each officer of the Trust who signed the Registration Statement,
and each person, if any, who controls the Trust or the Investment Adviser,
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same rights to contribution as the Trust and the Investment
Adviser, respectively. The Underwriters' respective obligations to contribute
pursuant to this Section 7 are several in proportion to the number of Initial
Securities set forth opposite their respective names in Schedule A hereto and
not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Trust or the Investment Adviser
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Trust or the Investment Adviser,
and shall survive delivery of the Securities to the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may terminate this
Agreement, by notice to the Trust, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Trust or the Investment
Adviser, whether or not arising in the ordinary course of business, or (ii) if
there has occurred any material adverse change in the financial markets in the
United States or the international financial markets, any outbreak of
hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international
political, financial or economic conditions, in each case the effect of which is
such as to make it, in the judgment of the Representatives, impracticable or
inadvisable to market the Securities or to enforce contracts for the sale of the
Securities, or (iii) if trading in the Common Shares of the Trust has been
suspended or materially limited by the Commission or the NYSE, or if trading
generally on the American Stock Exchange or the NYSE or in the Nasdaq National
Market has been suspended or materially limited, or minimum or maximum prices
for trading have been fixed, or maximum ranges for prices have been required, by
any of said exchanges or by such system or by order of the Commission, the NASD
or any other governmental authority, or a material disruption has occurred in
commercial banking or securities settlement or clearance services in the United
States, or (iv) if a banking moratorium has been declared by either Federal or
New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7, 8 and 13 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the Underwriters.
If one or more of the Underwriters shall fail at Closing Time or a Date
of Delivery to purchase the Securities which it or they are obligated to
purchase under this Agreement (the "Defaulted Securities"), the Representatives
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Securities in such amounts
as may be agreed upon and upon the terms herein set forth; if, however, the
Representatives shall not have completed such arrangements within such 24-hour
period, then:
19
(a) if the number of Defaulted Securities does not exceed 10% of
the number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
number of Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the Underwriters to purchase and of the Trust to sell the Option
Securities to be purchased and sold on such Date of Delivery shall terminate
without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Trust to sell the relevant Option Securities,
as the case may be, either the Representatives or the Trust shall have the right
to postpone Closing Time or the relevant Date of Delivery, as the case may be,
for a period not exceeding seven days in order to effect any required changes in
the Registration Statement or Prospectus or in any other documents or
arrangements. As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
SECTION 11. Tax Disclosure.
Notwithstanding any other provision of this Agreement, from the
commencement of discussions with respect to the transactions contemplated
hereby, the Trust and the Investment Adviser (and each employee, representative
or other agent of the Trust) may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure (as such terms are
used in Sections 6011, 6111 and 6112 of the U.S. Code and the Treasury
Regulations promulgated thereunder) of the transactions contemplated by this
Agreement and all materials of any kind (including opinions or other tax
analyses) that are provided relating to such tax treatment and tax structure.
SECTION 12. Notices.
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Underwriters shall be directed to the
Representatives, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, attention of Equity Capital Markets; and notices to the Trust or the
Investment Adviser shall be directed, as appropriate, to the office of Pioneer
Investment Management, Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: General Counsel.
SECTION 13. Parties.
This Agreement shall inure to the benefit of and be binding upon the
Underwriters, the Trust, the Investment Adviser and their respective partners
and successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters, the Trust, the Investment Adviser and each of their respective
successors and the controlling persons and officers, trustees and directors
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
Underwriters, the Trust, the Investment Adviser and their respective partners
and successors, and said controlling persons and officers, trustees and
directors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No
20
purchaser of Securities from any Underwriter shall be deemed to be a successor
by reason merely of such purchase.
SECTION 14. GOVERNING LAW AND TIME.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED IN SAID STATE. UNLESS OTHERWISE EXPLICITLY PROVIDED, SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. Effect of Headings.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
21
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the Underwriters, the Trust and Investment Adviser in accordance with its terms.
Very truly yours,
Pioneer Tax Advantaged Balanced Trust
By: ____________________________________
Name:
Title:
Pioneer Investment Management, Inc.
By: ____________________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
ADVEST, INC.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & CO. INCORPORATED
J.J.B. ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, INCORPORATED
QUICK & ▇▇▇▇▇▇, INC.
SUNTRUST CAPITAL MARKETS, INC.
By: ▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
By: ______________________________________
Authorized Signatory
For themselves and as Representatives of the
other Underwriters named in Schedule A hereto.
22
SCHEDULE A
Number of
Name of Underwriter Initial Securities
------------------- ------------------
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated..............................................
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. .........................................................
Advest, Inc. ...................................................................
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated..............................................
J.J.B. ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, Inc. ..............................................
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC.....................................................
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated............................................
Quick & ▇▇▇▇▇▇, Inc. ...........................................................
SunTrust Capital Markets, Inc. .................................................
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. ......................................................
BB&T Capital Markets, a division of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, Inc. .................
Citigroup Global Markets Inc. ..................................................
Deutsche Bank Securities Inc. ..................................................
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Incorporated...............................................
McDonald Investments Inc., a KeyCorp Company....................................
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc. ..................................................
▇▇▇▇▇▇▇▇▇▇▇ & Co. Inc. .........................................................
U.S. Bancorp ▇▇▇▇▇ ▇▇▇▇▇▇▇ Inc. ................................................
▇▇▇▇ ▇▇▇▇ & Co. ................................................................
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Company, Incorporated........................................
TD Waterhouse Investor Services, Inc. ..........................................
Total............................................................
Sch A-1
SCHEDULE B
Pioneer Tax Advantaged Balanced Trust
Common Shares of Beneficial Interest
(No Par Value)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $15.00.
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $14.325, being an amount equal to the initial
public offering price set forth above less $.675 per share; provided that the
purchase price per share for any Option Securities purchased upon the exercise
of the overallotment option described in Section 2(b) shall be reduced by an
amount per share equal to any dividends or distributions declared by the Trust
and payable on the Initial Securities but not payable on the Option Securities.
Sch B-1
Exhibit A
FORM OF OPINION OF TRUST'S AND INVESTMENT ADVISER'S
COUNSEL TO BE DELIVERED PURSUANT TO
SECTION 5(b)
January __, 2004
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇, Incorporated
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
Advest, Inc.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated
J.J.B. ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, Inc.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated
Quick & ▇▇▇▇▇▇, Inc.
SunTrust Capital Markets, Inc.
c/o Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Pioneer Tax Advantaged Balanced Trust
Ladies and Gentlemen:
This opinion is furnished to you pursuant to Section 5(b) of the Purchase
Agreement, dated as of January [ ], 2004 (the "Purchase Agreement"), among
you, as Representatives of the several Underwriters, Pioneer Investment
Management, Inc., a Delaware corporation (the "Adviser") and Pioneer Tax
Advantaged Balanced Trust, a Delaware statutory trust (the "Trust"). Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings ascribed to them in the Purchase Agreement.
We have acted as counsel for the Trust and the Adviser in connection
with the sale to the Underwriters by the Trust of [ ] common shares of
beneficial interest, no par value per share, of the Trust, (collectively, the
"Common Shares") pursuant to Section 2(a) of the Purchase Agreement. As such
counsel, we have assisted in the preparation and filing with the Securities and
Exchange Commission (the "Commission") of the Trust's Registration Statement on
Form N-2 dated October 17, 2003 (File No. 333-109797 and No. 811-21448), and
amendments ▇▇. ▇, ▇▇. ▇ and No. 3 thereto, which Registration Statement became
effective on January __, 2004 (the "Effective Date"). Such Registration
Statement, in the form in which it became effective, is referred to herein as
the "Registration Statement," and the prospectus dated [ ], 2004 (the
"Prospectus") and statement of additional information dated [ ], 2004
included therein, as filed pursuant to Rule 497 of the Securities Act of 1933,
as amended (the "Securities Act"), on [ ], 2004, referred to herein as the
"Prospectus" and the "Statement of Additional Information."
We have examined and relied upon the Agreement and Declaration of Trust
and By-laws of the Trust, each as amended to date, records of meetings or
written actions of shareholders and of the Board of Trustees of the Trust, trust
proceedings of the Trust in connection with the authorization and issuance of
the Common Shares, the Certificate of Incorporation and By-laws of the Adviser,
each as amended to
A-1
date, written actions of the Board of Directors of the Adviser, the Registration
Statement, the Prospectus, the Statement of Additional Information, the Purchase
Agreement, certificates of representatives of the Trust and the Adviser,
certificates of public officials and such other documents as we have deemed
necessary as a basis for the opinions hereinafter expressed. We have assumed
that all corporate or trust records of the Trust and the Adviser and stock books
of the Trust and are complete and accurate.
Insofar as this opinion relates to factual matters, information with
respect to which is in the possession of the Trust or the Adviser, we have
relied, with your permission, upon certificates, statements and representations
of officers and other representatives of the Trust and the Adviser,
representations made in the Purchase Agreement and statements contained in the
Registration Statement. We have not attempted to verify independently such
facts, although nothing has come to our attention which has caused us to
question the accuracy of such certificates, statements or representations.
In our examination of the documents referred to above, we have assumed
the genuineness of all signatures, the legal capacity of each individual signing
such documents, the authenticity of all documents submitted to us as originals,
the conformity to original documents of all documents submitted to us as copies,
and the authenticity of the originals of such documents.
Any reference to "our knowledge" or to any matters "known to us," "of
which we are aware" or "coming to our attention" or any variation of any of the
foregoing, shall mean the conscious awareness of the attorneys in this firm who
have rendered substantive attention to the transaction to which this opinion
relates, as to the existence or absence of any facts which would contradict the
opinions and statements set forth herein. Other than as expressly set forth
below, we have not undertaken, for purposes of this opinion, any independent
investigation to determine the existence or absence of such facts, and no
inference as to our knowledge of the existence or absence of such facts should
be drawn from the fact of our representation of the Trust and the Adviser.
Moreover, we have not searched any electronic databases or the dockets of any
court, regulatory body or administrative or governmental agency or other filing
office in any jurisdiction.
For purposes of the opinions set forth in this letter, we have assumed
that the agreements referred to herein have been duly authorized, executed and
delivered by all parties thereto other than the Trust and the Adviser, and that
all such other parties have all requisite power and authority to effect the
transactions contemplated by such agreements. We have also assumed that each
such agreement is the valid and binding obligation of each party thereto other
than the Trust and the Adviser and is enforceable against such other parties in
accordance with its terms. We do not render any opinion as to the application of
any federal or state law or regulation to the power, authority or compliance of
any party to the agreements other than the Trust and the Adviser.
Our opinions set forth below are qualified to the extent that they may
be subject to or affected by (i) applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or similar laws relating to or
affecting the rights of creditors generally, (ii) statutory or decisional law
concerning recourse by creditors to security in the absence of notice or
hearing, (iii) duties and standards imposed on creditors and parties to
contracts, including, without limitation, requirements of good faith,
reasonableness and fair dealing, and (iv) general equitable principles. We
express no opinion as to the availability of any equitable or specific remedy
upon any breach of any of the agreements as to which we are opining herein, or
any of the agreements, documents or obligations referred to therein, or to the
successful assertion of any equitable defenses, inasmuch as the availability of
such remedies or the success of any equitable defense may be subject to the
discretion of a court.
We also express no opinion herein as to any provision of any agreement
(a) which may be deemed to or construed to waive any right of the Trust or the
Adviser, (b) to the effect that rights and remedies are not exclusive, that
every right or remedy is cumulative and may be exercised in addition to or with
any other right or remedy and does not preclude recourse to one or more other
rights or remedies,
A-2
\
(c) relating to the effect of invalidity or unenforceability of any provision of
any agreement on the validity or enforceability of any other provision thereof,
(d) requiring the payment of penalties, consequential damages or liquidated
damages, (e) which is in violation of public policy, including, without
limitation, any provision relating to non-competition and non-solicitation or
relating to indemnification and contribution with respect to securities law
matters, (f) purporting to indemnify any person against his, her or its own
negligence or intentional misconduct, (g) which provides that the terms of any
agreement may not be waived or modified except in writing or (h) relating to
choice of law or consent to jurisdiction.
Our opinion expressed in paragraph 1 below as to the legal existence
and good standing of the Trust and the payment of franchise taxes is based
solely on certificate of legal existence issued by the Secretary of State of the
State of Delaware, a copy of which has been made available to your counsel, and
our opinion with respect to such matters is rendered as of the date of such
certificates and limited accordingly. Our opinion expressed in paragraph 14
below as to the legal existence and good standing of the Adviser and the payment
of franchise taxes is based solely on a certificate of legal existence issued by
the Secretary of State of the State of Delaware, a copy of which has been made
available to your counsel, and our opinion with respect to such matters is
rendered as of the date of such certificate and limited accordingly. We express
no opinion as to the tax good standing of the Trust or the Adviser in any
jurisdiction.
In connection with our opinion expressed in paragraph 2 below, insofar
as it relates to full payment for the outstanding Common Shares of the Trust, we
have relied solely on a certificate of an officer of the Trust. Our opinion
expressed in paragraph 2 below as to issued and outstanding shares of beneficial
interest of the Trust is based solely on a certificate of the Trust's transfer
agent, which we assume to be complete and accurate. Our opinion expressed in
paragraph 2 below as to the due and valid issuance of all outstanding Common
Shares of the Trust is based solely on a review of the corporate minute books of
the Trust, and a certificate of an officer of the Trust, each of which we assume
to be complete and accurate.
Our opinion expressed in paragraph 5 below as to the effectiveness of
the Registration Statement under the Securities Act is based solely upon oral
advice from [▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇] at the Division of Investment Management of the
Commission that the Registration Statement was declared effective as of [ a.m.]
on [ ], 2004. Our opinion in paragraph 16 below is based solely upon the
Commission's Investment Adviser Public Disclosure Website as of the date of this
opinion.
Our opinion expressed in paragraph 10 below is based solely upon the
information provided by the Trustees of the Trust as reflected in the 2003
directors and officers questionnaires.
We are opining herein solely with respect to the state laws of The
Commonwealth of Massachusetts, the Delaware Statutory Trust Act statute, the
Delaware General Corporation Law statute and the federal laws of the United
States of America. To the extent that any other laws or any other jurisdiction
govern any of the matters as to which we express an opinion below, we have
assumed for purposes of this opinion, with your permission and without
independent investigation, that the laws of such jurisdiction are identical to
the substantive state laws of The Commonwealth of Massachusetts, and we express
no opinion as to whether such assumption is reasonable or correct. We note that
the Purchase Agreement is governed by New York law. We express no opinion with
respect to (i) the securities or Blue Sky laws of any state or other
jurisdiction of the United States or of any foreign jurisdiction or (ii) the
By-Laws or any rules or other regulations of the National Association of
Securities Dealers, Inc. In addition, we express no opinion and, except as set
forth below in the second to last paragraph hereof, make no statement herein
with respect to the antifraud laws of any jurisdiction.
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On the basis of and subject to the foregoing, we are of the opinion
that:
1. The Trust is validly existing as a statutory trust in good
standing under the state laws of the State of Delaware and has statutory trust
power and authority to carry on its business and own, lease and operate its
properties as described in the Prospectus and to enter into and perform its
obligations under the Purchase Agreement. No franchise taxes that are currently
due with respect to the Trust have not been paid.
2. The authorized, issued and outstanding shares of beneficial
interest of the Trust are as set forth in the Prospectus are as set forth in the
Statement of Additional Information under the caption "Financial Statements and
Independent Auditors' Report." All issued and outstanding shares of beneficial
interest of the Trust as of the date hereof have been duly authorized, validly
issued, are fully paid and non-assessable, have been sold to the Adviser
pursuant to an exception from registration under the Securities Act and are not
and will not be subject to any preemptive or similar statutory rights under the
Delaware Statutory Trust Act statute or, to our knowledge, similar contractual
rights granted by the Trust.
3. The Common Shares have been duly authorized and, when issued
and delivered to the Underwriters against payment therefore as provided by the
Purchase Agreement, will be validly issued and fully paid and non-assessable and
no holder of the Common Shares is or will be subject to personal liability under
the Declaration of Trust or the Delaware Statutory Trust Act by reason of being
such a holder.
4. The Purchase Agreement has been duly authorized, executed and
delivered by the Trust.
5. The issuance of Shares will not be subject to any preemptive
or similar statutory rights under the Delaware Statutory Trust Act statute or
under the Declaration of Trust or, to our knowledge, similar contractual rights
granted by the Trust.
6. The Registration Statement has been declared effective under
the Securities Act. Any required filing of the Prospectus pursuant to Rule
497(c) or Rule 497(h) has been made in the manner and within the time period
required by Rule 497. To our knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued under the Securities
Act. To our knowledge, (i) no order of suspension or revocation of registration
pursuant to Section 8(e) of the Investment Company Act of 1940, as amended, and
the rules and regulations thereunder (the "1940 Act"), has been issued, and (ii)
no proceedings for any such purpose have been instituted or are pending or
threatened by the Commission.
7. To our knowledge, there are no legal or governmental
proceedings pending or threatened against the Trust.
8. The statements in the Prospectus under the captions
"Description of Shares" and "Federal Income Tax Matters", in the Statement of
Additional Information under the caption "Federal Income Tax Matters" and in
Item 28 of Part C of the Registration Statement, insofar as such statements
constitute matters of law or legal conclusions or are descriptions of the rights
set forth in the Declaration of Trust or By-laws, are correct in all material
respects.
9. Each of the Investment Advisory Agreement between the Trust
and the Adviser, dated ________, 2004 (the "Advisory Agreement"), the
Administration Agreement among the Trust, the Adviser and Princeton
Administrators, L.P., a Delaware limited partnership, dated as of ________, 2004
(the "Administration Agreement"), the Custodian Agreement, dated as of July 1,
2001, among ▇▇▇▇▇ Brothers ▇▇▇▇▇▇▇▇ & Co. and the Pioneer mutual funds named
therein, as supplemented as of ________, 2004 to add the Trust as a party
thereto (the "Custodian Agreement), the Investment Company Service Agreement,
dated __________, 2004, between the Trust and Pioneer Investment Management
Shareholder Services, Inc. (the "Transfer Agency Agreement"), the Expense
Limitation Agreement, dated as of January ___, 2004, between the Trust and the
Adviser (the "Expense Limitation Agreement") and
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the Purchase Agreement do not violate the 1940 Act, the Investment Advisers Act
of 1940, as amended, and the rules and regulations thereunder (the "Advisers
Act").
10. The Trust is registered with the Commission under the 1940 Act
as a closed-end diversified management investment company. To our knowledge, no
order of suspension or revocation of such registration has been issued or
proceedings therefor initiated or, to our knowledge, threatened by the
Commission.
11. To our knowledge, no person affiliated with the Adviser is
serving as an officer, trustee or investment adviser of the Trust except in
accordance with the 1940 Act and the Advisers Act. Except as disclosed in the
Registration Statement and Prospectus (or any amendment or supplement to either
of them), to our knowledge, no Trustee of the Trust is an "interested person"
(as defined in the ▇▇▇▇ ▇▇▇) of the Trust or an "affiliated person" (as defined
in the ▇▇▇▇ ▇▇▇) of an Underwriter.
12. The execution and delivery of the Purchase Agreement by the
Trust, the compliance by the Trust with all the provisions thereof and the
consummation by the Trust of the transactions contemplated thereby (including
the issuance and sale of the Common Shares and the use of the proceeds from the
sale of the Common Shares as described in the Prospectus under the caption "Use
of Proceeds") do not and will not (A) require any consent, approval,
authorization or other order of, or qualification with, any Massachusetts state
or U.S. federal court or governmental body or agency (except such as may be
required under the securities or Blue Sky laws of the various states or the
National Association of Securities Dealers, Inc. or as have been obtain under
the federal securities laws), (B) conflict with or constitute a breach of any of
the terms or provisions of, or a default under, or result in the imposition of a
lien, charge or encumbrance upon the assets of the Trust pursuant to any
indenture, loan agreement, mortgage, lease or other agreement or instrument
filed as an exhibit to the Registration Statement, (C) violate or conflict with
the Declaration of Trust or By-laws, (D) violate or conflict with the Delaware
Statutory Trust Act statute or any applicable U.S. federal or Massachusetts
state law, rule or regulation which in our experience is normally applicable in
transactions of the type contemplated by the Purchase Agreement, or (E) violate
or conflict with any judgment, order or decree specifically naming the Trust or
specifically applicable to the Trust's property and of which we are aware.
13. Each of the Advisory Agreement, the Administration Agreement,
the Custodian Agreement, the Expense Limitation Agreement and the Transfer
Agency Agreement has been duly authorized by all requisite action on the part of
the Trust, executed and delivered by the Trust, as of the dates noted therein.
Assuming due authorization, execution and delivery by the other parties thereto
with respect to the Administration Agreement, Custodian Agreement, the Expense
Limitation Agreement and the Transfer Agency Agreement, each of the Advisory
Agreement, the Administration Agreement, the Custodian Agreement, the Expense
Limitation Agreement and the Transfer Agency Agreement constitutes a valid and
binding agreement of the Trust, enforceable against the Trust in accordance with
their respective terms.
14. The form of certificate used to evidence the Common Shares
complies in all material respects with all applicable requirements of the
Delaware Statutory Trust Act statute, with any applicable requirements of the
Declaration of Trust and By-Laws of the Trust and the requirements of the New
York Stock Exchange.
15. The Adviser is validly existing as a corporation in good
standing under the laws of the State of Delaware. No franchise taxes that are
currently due with respect to the Adviser have not been paid.
16. The Adviser has corporate power and authority to own, lease
and operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the Purchase
Agreement.
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17. The Adviser is registered with the Commission as an investment
adviser under the Advisers Act and is not prohibited by the Advisers Act or the
1940 Act from acting under the Advisory Agreement for the Trust as contemplated
by the Prospectus.
18. The Purchase Agreement, the Advisory Agreement and the
Administration Agreement have been duly authorized, executed and delivered by
the Adviser, and the Advisory Agreement and the Administration Agreement each
constitutes a valid and binding obligation of the Adviser, enforceable in
accordance with their respective terms.
19. To our knowledge, there is no legal or governmental proceeding
pending or threatened against the Adviser that is: (1) required by the
Securities Act or the 1940 Act and their rules and regulations to be described
in the Registration Statement in the Prospectus that is not already described,
or (2) which would, under Section 9 of the 1940 Act, make the Adviser ineligible
to act as the Trust's investment adviser.
20. The execution, delivery and performance of the Purchase
Agreement by the Adviser, and the consummation by the Adviser of the
transactions contemplated thereby, do not and will not (A) require any consent,
approval, authorization or other order of, or qualification with, any
Massachusetts state or U.S. federal court or governmental body or agency (except
such as may be required under the securities or Blue Sky laws of the various
states of the National Association of Securities Dealers, Inc. or as have been
obtain under the federal securities laws), (B) conflict with or constitute a
breach of any of the terms or provisions of, or a default under, or result in
the imposition of a lien, charge or encumbrance upon the assets of the Adviser
pursuant to any indenture, loan agreement, mortgage, lease or other agreement or
instrument filed as an exhibit to the Registration Statement, (C) violate or
conflict with the Certificate of Incorporation or By-laws of the Adviser, or (D)
violate or conflict with the Delaware Corporation Law statute or any applicable
U.S. federal and Massachusetts state law, rule or regulation which in our
experience is normally applicable in transactions of the type contemplated by
the Purchase Agreement, or (E) violate or conflict with any judgment, order or
decree specifically naming the Adviser or specifically applicable to the
Adviser's property of which we are aware.
The foregoing opinions are provided to you, as Representative of the
Underwriters, as a legal opinion only and not as a guaranty or warranty of the
matters discussed herein. These opinions are based upon currently existing
statutes, rules, regulations and judicial decisions and are rendered as of the
date hereof, and we disclaim any obligation to advise you of any change in any
of the foregoing sources of law or subsequent developments in law or changes in
facts or circumstances which might affect any matters or opinions set forth
herein.
In addition to the opinions provided above, we wish to confirm to you:
In connection with the preparation of the Registration Statement, the
Prospectus and the Statement of Additional Information, we have participated in
conferences with officers and representatives of the Trust and the Adviser,
representatives of and counsel for the Underwriters, and representatives of the
independent accountants of the Trust, during which the contents of the
Registration Statement, the Prospectus and the Statement of Additional
Information were discussed. While the limitations inherent in the independent
verification of factual matters and the character of determinations involved in
the registration process are such that we are not passing upon and do not assume
any responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement, the Prospectus or the Statement of
Additional Information, subject to the foregoing and based on such
participation, inquiries and discussions, we advise you that (a) the
Registration Statement, including any Rule 430A Information, the Prospectus and
each amendment or supplement to the Registration Statement and Prospectus as of
their respective effective or issue dates (except for the financial statements,
including the notes and schedules thereto, and other financial, statistical and
accounting data and information included therein or omitted therefrom, as to
which we express no view),
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and the notification on Form N-8A, as amended, appear on their face to be
appropriately responsive in all material respects to the requirements of the
Securities Act, the 1940 act and the applicable rules and regulations of the
Commission thereunder, (b) no facts have come to our attention which have caused
us to believe that (i) the Registration Statement, as of the Effective Date (but
after giving effect to changes incorporated pursuant to Rule 430A under the
Securities Act), contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary in order to
make the statements therein not misleading (except that we express no such view
with respect to the financial statements, including the notes and schedules
thereto, and any other financial, statistical or accounting data and information
included therein or omitted therefrom), or (ii) the Prospectus and the Statement
of Additional Information, as of the date filed with the Commission pursuant to
Rule 497 under the Securities Act or as of the date hereof, contained any untrue
statement of a material fact or omitted to state any material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading (except that we express no such view with respect
to the financial statements, including the notes and schedules thereto, or any
other financial, statistical and accounting data included therein or omitted
therefrom.).
This opinion is being furnished to you, as Representatives of the
Underwriters, at the request of the Trust pursuant to the Purchase Agreement, is
solely for the benefit of the Underwriters in connection with the transactions
contemplated in the Purchase Agreement. This letter may not be relied upon by
the Underwriters for any other purpose, not may this opinion be provided to,
quoted to or relied upon by any other party or entity for any purpose without
our prior written consent. We understand that ▇▇▇▇▇▇▇▇ Chance US LLP in
delivering their opinion pursuant to Section 5(c) of the Purchase Agreement is
relying upon our opinions expressed in paragraph[s] ___.
Very truly yours,
▇▇▇▇ AND ▇▇▇▇ LLP
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