Evergreen Income Advantage Fund
(a Delaware statutory trust)
[ ] Auction Market Preferred Shares ("AMPS")
[ ] Shares [ ]% AMPS, Series M28
[ ] Shares [ ]% AMPS, Series W28
[ ] Shares [ ]% AMPS, Series T7
[ ] Shares [ ]% AMPS, Series W7
[ ] Shares [ ]% AMPS, Series TH7
[ ] Shares [ ]% AMPS, Series F7
Liquidation Preference $25,000 per share
FORM OF PURCHASE AGREEMENT
April [ ], 2003
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Citigroup Global Markets Inc.
UBS Warburg LLC
Wachovia Securities, Inc.
c/▇ ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
4 World Financial Center
New York, New York 10080
Ladies and Gentlemen:
Evergreen Income Advantage Fund, a Delaware statutory trust (the
"Fund"), proposes, upon the terms and conditions set forth herein, to issue and
sell an aggregate of [ ] Shares of its Auction Market Preferred Shares, Series
M28, [ ] Shares of its Auction Market Preferred Shares, Series W28, [ ] Shares
of its Auction Market Preferred Shares, Series T7, [ ] Shares of its Auction
Market Preferred Shares, Series W7, [ ] Shares of its Auction Market Preferred
Shares, Series TH7, and [ ] Shares of its Auction Market Preferred Shares,
Series F7 (the "AMPS"). The AMPS will be authorized by, and subject to the terms
and conditions of, the Agreement and Declaration of Trust, as amended through
February 11, 2003 (the "Charter"), in the form filed as an exhibit to the
Registration Statement referred to in the second following paragraph to this
Agreement, as the same may be amended from time to time. The Fund and the Fund's
investment adviser, Evergreen Investment Management Company, LLC, a Delaware
limited liability company (the "Adviser"), each confirms its agreement with
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
(together, "▇▇▇▇▇▇▇ ▇▇▇▇▇") 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
▇▇▇▇▇▇▇ ▇▇▇▇▇ is acting as representative (in such capacity, the
"Representative"), with respect to the issue and sale by the Fund and the
purchase by the Underwriters, acting severally and not jointly, of the
respective number of AMPS set forth in said Schedule A.
The Fund understands that the Underwriters propose to make a public
offering of the AMPS as soon as the Representative deems advisable after this
Agreement has been executed and delivered.
The Fund has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form N-2 (No. 333-103590 and No.
811-21269) covering the registration of the AMPS 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 (the "1940 Act
notification") of the Fund 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 Fund 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 Fund 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, 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 or 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 AMPS, 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 April [14], 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; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934 (the "1934 Act") which is
incorporated by reference in the Registration Statement, such preliminary
prospectus or the Prospectus, as the case may be.
Section 1. Representations and Warranties.
(a) Representations and Warranties by the Fund and the Adviser. The Fund
and the 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 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 Fund or the Adviser, are 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, 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,
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 Fund 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 Registration Statement as originally filed 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 AMPS, the Fund 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. 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 financial statements
included in the Registration Statement and the Prospectus,
together with the related notes, presents fairly the financial
position of the Fund 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 is given in the Registration Statement
and the Prospectus, except as otherwise stated therein, (A) there
has been no material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business
prospects of the Fund, whether or not arising in the ordinary
course of business (a "Material Adverse Effect"), (B) there have
been no transactions entered into by the Fund, other than those
in the ordinary course of business, which are material with
respect to the Fund, and (C) there has been no dividend or
distribution of any kind declared, paid or made by the Fund on
any class of its capital stock.
(vi) Good Standing of the Fund. The Fund has been duly
organized and is validly existing as a statutory trust in good
standing under the laws of the State of Delaware and has the
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 Fund is duly qualified as a foreign trust 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 Fund has no subsidiaries.
(viii) Investment Company Status. The Fund is duly
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 Fund 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 Fund is an
"interested person" (as defined in the 1940 Act) of the Fund or
an "affiliated person" (as defined in the 1940 Act) of any
Underwriter.
(x) Capitalization. The authorized, issued and outstanding
shares of beneficial interest of the Fund is as set forth in the
Prospectus as of the date thereof under the caption "Description
of Shares." All issued and outstanding shares of beneficial
interest of the Fund have been duly authorized and validly issued
and are fully paid and non-assessable, except as provided for in
the Fund's declaration of trust, and have been offered and sold
or exchanged by the Fund in compliance with all applicable laws
(including, without limitation, federal and state securities
laws); none of the outstanding shares of beneficial interest of
the Fund was issued in violation of the preemptive or other
similar rights of any securityholder of the Fund.
(xi) Authorization and Description of AMPS. The AMPS to be
purchased by the Underwriters from the Fund have been duly
authorized for issuance and sale to the Underwriters pursuant to
this Agreement and, when issued and delivered by the Fund
pursuant to this Agreement against payment of the consideration
set forth herein, will be validly issued and fully paid and
non-assessable, except as provided for in the Fund's declaration
of trust. The AMPS conform to all statements relating thereto
contained in the Prospectus and such description conforms to the
rights set forth in the instruments defining the same; no holder
of the AMPS will be subject to personal liability by reason of
being such a holder; and the issuance of the AMPS is not subject
to the preemptive or other similar rights of any securityholder
of the Fund.
(xii) Absence of Defaults and Conflicts. The Fund is not in
violation of its declaration of trust or bylaws, or in default in
the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture,
mortgage, deed 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
Fund 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 Management Agreement, the
Administration Agreement, the Custodian Agreement, the Transfer
and Dividend Disbursing Agent and Registrar Agreement and the
Auction Agency Agreement referred to in the Registration
Statement (as used herein, the "Management Agreement," the
"Administration Agreement," the "Custodian Agreement" the
"Transfer and Dividend Disbursing Agency and Registrar
Agreement," and the "Auction Agency Agreement" respectively) and
the consummation of the transactions contemplated herein and in
the Registration Statement (including the issuance and sale of
the AMPS and the use of the proceeds from the sale of the AMPS as
described in the Prospectus under the caption "Use of Proceeds")
and compliance by the Fund 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 Fund 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
bylaws of the Fund 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 Fund 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
Fund.
(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 Fund or the Adviser,
threatened, against or affecting the Fund, 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 Fund or the consummation of the transactions
contemplated in this Agreement or the performance by the Fund of
its obligations hereunder. The aggregate of all pending legal or
governmental proceedings to which the Fund 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 Fund 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 Fund, and the Fund 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 protect the interest of the Fund
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
Fund of its obligations hereunder, in connection with the
offering, issuance or sale of the AMPS 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 under the rules of the
American Stock Exchange ("AMEX") or the National Association of
Securities Dealers, Inc ("NASD") or state securities laws.
(xvii) Possession of Licenses and Permits. The Fund
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 Fund
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 Fund 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" and
"electronic road show presentations") authorized in writing by or
prepared by the Fund or the Advisers used in connection with the
public offering of the AMPS (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 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,
the Rules and Regulations and the rules and interpretations of
the NASD.
(xix) Subchapter M. The Fund 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 or Other Materials. The Fund
has not distributed or made available, or permitted any other
person to distribute or make available, and, prior to the later
to occur of (A) the Closing Time and (B) completion of the
distribution of the AMPS, the Fund will not distribute, nor will
it permit any other person to distribute or make available any
material (including, without limitation, any material distributed
or made available by mail, radio, television, printed publication
or by internet) in connection with the offering and sale of the
AMPS or otherwise having the affect to condition the market for
the offer of the AMPS, other than the Registration Statement, a
preliminary prospectus, the Prospectus or other materials, if
any, permitted by the 1933 Act or the 1940 Act or the Rules and
Regulations.
(xxi) Accounting Controls. The Fund 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 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 Fund's
knowledge, neither the Fund nor any employee or agent of the Fund
has made any payment of funds of the Fund 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 Management
Agreement, the Administration Agreement, the Custodian Agreement,
the Transfer and Dividend Disbursing Agency and Registrar
Agreement and the Auction Agency Agreement have each been duly
authorized by all requisite action on the part of the Fund and
executed and delivered by the Fund, 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 with respect to the Management
Agreement, the Administration Agreement, the Custodian Agreement,
the Transfer and Dividend Disbursing Agency and Registrar
Agreement and the Auction Agency Agreement, each of the
Management Agreement, the Administration Agreement, the Custodian
Agreement, the Transfer and Dividend Disbursing Agency and
Registrar Agreement, and the Auction Agency Agreement constitutes
a valid and binding agreement of the Fund, 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).
(xxiv) Registration Rights. There are no persons with
registration rights or other similar rights to have any
securities registered pursuant to the Registration Statement or
otherwise registered by the Fund under the 1933 Act.
(xxv) Ratings. The AMPS have been, or prior to the Closing
Date will be, assigned a rating of "Aaa" by ▇▇▇▇▇'▇ Investors
Service, Inc. ("▇▇▇▇▇'▇") and "AAA" by Fitch Ratings ("Fitch").
(xxvi) Leverage. The Fund has no liability for borrowed
money, including under any reverse repurchase agreements.
(b) Representations and Warranties by the Adviser. The Adviser represents
and warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof as follows:
(i) Good Standing of the Adviser. The Adviser has been duly
organized and is validly existing and in good standing as a
limited liability company under the laws of the State of Delaware
with full power and authority to own, lease and operate its
properties and to conduct its business as described in the
Prospectus and is duly qualified as a foreign company to transact
business and is in good standing in each other jurisdiction in
which such qualification is required.
(ii) Investment Adviser Status. The Adviser is duly
registered and in good standing 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 Management Agreement for
the Fund as contemplated by the Prospectus.
(iii) Description of Adviser. The description of the 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.
(iv) Capitalization. The 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 Management Agreement to which it is a party.
(v) Authorization of Agreements; Absence of Defaults and
Conflicts. This Agreement and the Management Agreement have each
been duly authorized, executed and delivered by the Adviser, and
the Management Agreement constitutes a valid and binding
obligation of the 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 Management Agreement, nor the performance by the
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 Adviser is a party or by which it is bound, the
agreement and articles of organization, the bylaws or other
organizational documents of the Adviser, or to the 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 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 Adviser of the transactions contemplated by this
Agreement, the Management Agreement and the Additional
Compensation Agreement, except as have been obtained or may be
required under the 1933 Act, the 1940 Act, the 1934 Act or state
securities laws.
(vi) No Material Adverse Change. Since the respective dates
as of which information 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 Adviser to
perform its respective obligations under this Agreement and the
Management Agreement to which it is a party.
(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 Adviser, threatened against
or affecting the Adviser or any "affiliated person" of the
Adviser (as such term is defined in the 1940 Act) or any
partners, directors, officers or employees of the foregoing,
whether or not arising in the ordinary course of business, which
might 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 Adviser, materially
and adversely affect the properties or assets of the Adviser or
materially impair or adversely affect the ability of the Adviser
to function as an investment adviser or perform its obligations
under the Management Agreement, or which is required to be
disclosed in the Registration Statement and the Prospectus.
(viii) Absence of Violation or Default. The Adviser is not
in violation of its agreement and articles of organization,
bylaws or other organizational documents or in default under any
agreement, indenture or instrument.
(c) Officer's Certificates. Any certificate signed by any officer of the
Fund or the Adviser delivered to the Representative or to counsel for the
Underwriters shall be deemed a representation and warranty by the Fund or the
Adviser, as the case may be, to each Underwriter as to the matters covered
thereby.
Section 2. Sale and Delivery to Underwriters; Closing.
(a) AMPS. On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Fund
agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Fund, at the
price per share set forth in Schedule B, the number of AMPS set forth in
Schedule A opposite the name of such Underwriter, plus any additional number of
AMPS which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
(b) Commission. The Fund agrees to pay to the Underwriters a commission set
forth in Schedule B, as compensation to the Underwriters for their
commitments under this Agreement.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the AMPS shall be made at the offices of Clifford Chance US
LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ or at such other place as shall
be agreed upon by the Representative and the Fund, 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 Representative
and the Fund (such time and date of payment and delivery being herein called
"Closing Time").
Payment shall be made to the Fund by wire transfer of immediately available
funds to a bank account designated by the Fund, against delivery to the
Representative for the respective accounts of the Underwriters of certificates
for the AMPS to be purchased by them. It is understood that each Underwriter has
authorized the Representative, for its account, to accept delivery of, receipt
for, and make payment of the purchase price for AMPS that 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 AMPS to be purchased by any Underwriter whose funds have not been
received by the Closing Time, but such payment shall not relieve such
Underwriter from its obligations hereunder.
(d) Denominations; Registration. Certificates for the AMPS, each
representing one series thereof, shall be registered in the name of Cede & Co.,
as nominee for the Depository Trust Company. The certificates for the AMPS will
be made available for examination and packaging by the Representative in the
City of New York not later than 10:00 A.M. (Eastern time) on the business day
prior to the Closing Time.
Section 3. Covenants.
(a) The Fund and the Adviser, jointly and severally, covenant with each
Underwriter as follows:
(i) Compliance with Securities Regulations and Commission
Requests. The Fund, subject to Section 3(a)(ii), will comply with
the requirements of Rule 430A or Rule 434, as applicable, and
will notify the Representative 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 AMPS for
offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes. The Fund
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 Fund 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 Fund will give the
Representative 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 Representative 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 Representative or counsel for the Underwriters shall
object.
(iii) Delivery of Registration Statements. The Fund has
furnished or will deliver to the Representative 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
Representative, without charge, a conformed copy of the
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 Fund has delivered to
each Underwriter, without charge, as many copies of each
preliminary prospectus as such Underwriter reasonably requested,
and the Fund hereby consents to the use of such copies for
purposes permitted by the 1933 Act. The Fund 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 AMPS, 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 Fund, 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 Fund 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 Fund 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 Fund will use its best
efforts, in cooperation with the Underwriters, to qualify the
AMPS for offering and sale under the applicable securities laws
of such states and other jurisdictions of the United States as
the Representative 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 Fund shall not be obligated to file any general
consent to service of process or to qualify as a foreign trust 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 AMPS have been so
qualified, the Fund 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 Fund 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 Fund will use the net proceeds
received by it from the sale of the AMPS in the manner specified
in the Prospectus under "Use of Proceeds".
(ix) Restriction on Sale of AMPS. During a period of 180
days from the date of the Prospectus, the Fund will not, without
the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, (A) directly or
indirectly, offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of AMPS or any securities
convertible into or exercisable or exchangeable for AMPS 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 AMPS, whether any such swap or transaction described in
clause (A) or (B) above is to be settled by delivery of AMPS or
such other securities, in cash or otherwise. The foregoing
sentence shall not apply to (1) the AMPS to be sold hereunder or
(2) AMPS issued pursuant to any dividend reinvestment plan.
(x) Reporting Requirements. The Fund, 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.
(xi) Subchapter M. The Fund will comply with the
requirements of Subchapter M of the Code to qualify as a
regulated investment company under the Code.
(xii) No Manipulation of Market for AMPS. The Fund 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 Fund to facilitate the sale or resale of the AMPS, and (b)
until the Closing Date (i) sell, bid for or purchase the AMPS or
pay any person any compensation for soliciting purchases of the
AMPS or (ii) pay or agree to pay to any person any compensation
for soliciting another to purchase any other securities of the
Fund.
(xiii) Rule 462(b) Registration Statement. If the Fund
elects to rely upon Rule 462(b), the Fund 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 Fund 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.
(xiv) Accountant's Certificate. The Fund will furnish to the
Underwriters, on the date on which delivery is made to the Rating
Agencies, the Accountant's Certificate (as defined in the
Charter) corresponding to the Certificate of Dividend Coverage
and Certificate of Eligible Asset Coverage (as defined in the
Charter) for the first Valuation Date (as defined in the Charter)
following the Closing Time.
(b) Except as provided in this Agreement, the Fund will not sell, contract
to sell or otherwise dispose of any of its preferred shares of beneficial
interest of the same series as the AMPS or any securities convertible into or
exercisable or exchangeable for its preferred shares of beneficial interest of
the same series as the AMPS, or grant any options or warrants to purchase its
preferred shares of beneficial interest of the same series as the AMPS, for a
period of 180 days after the date of the Prospectus, without the prior written
consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 4. Payment of Expenses.
(a) Expenses. The Fund 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 Underwriters and such other documents as may be required in
connection with the offering, purchase, sale, issuance or delivery of the AMPS,
(iii) the preparation, issuance and delivery of the certificates for the AMPS 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 AMPS to the
Underwriters, (iv) the fees and disbursements of the Fund's counsel, accountants
and other advisers, (v) the qualification of the AMPS 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 AMPS,
and (ix) the printing of any sales material.
(b) Termination of Agreement. If this Agreement is terminated by the
Representative in accordance with the provisions of Section 5 or Section 9(a)
hereof, the Fund and the 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 Fund and the Adviser
contained in Section 1 hereof or in certificates of any officer of the Fund or
the Adviser delivered pursuant to the provisions hereof, to the performance by
the Fund and the 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 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 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, if the Fund has
elected to rely on upon Rule 434, a Term Sheet shall have been filed with the
Commission in accordance with Rule 497.
(b) Opinion of Counsel for the Fund and the Adviser. At Closing Time, the
Representative shall have received the favorable opinions, dated as of Closing
Time, from ▇▇▇▇▇▇▇▇ & Worcester LLP, counsel for the Fund and from ▇▇▇▇▇▇▇
▇▇▇▇▇▇, Esq., counsel for the Adviser, in form and substance satisfactory to
counsel for the Underwriters, together with signed or reproduced copies of such
letters for each of the other Underwriters substantially to the effect set forth
in Exhibit A hereto and to such further effect as counsel to the Underwriters
may reasonably request. ▇▇▇▇▇▇▇▇ & Worcester LLP may rely on Delaware counsel as
to certain matters of Delaware law.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representative shall have received the favorable opinion, dated as of Closing
Time, of Clifford 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 (A) (i), (ii), (vi), (vii)
(solely as to preemptive or other similar rights arising by operation of law or
under the charter or bylaws of the Fund), (viii) through (x), inclusive, (xiv)
(solely as to the information in the Prospectus under "Description of AMPS") and
the 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 Representative. 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 Fund 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
Fund, whether or not arising in the ordinary course of business, and the
Representative shall have received a certificate of a duly authorized officer of
the Fund and of the chief financial or chief accounting officer of the Fund and
of the President or a Vice President or Managing Director of the 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 are true and correct with the same force and effect as though expressly
made at and as of Closing Time, (iii) each of the Fund and the 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 Representative shall have received from KPMG LLP a letter dated
such date, in form and substance satisfactory to the Representative, 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 Representative shall
have received from KPMG 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) Rating. The Fund shall have delivered and you shall have received
evidence satisfactory to you that the AMPS are rated `Aaa' by ▇▇▇▇▇'▇ and `AAA'
by Fitch as of the Closing Date, and there shall not have been given any notice
of any intended or potential downgrading, or of any review for a potential
downgrading, in the rating accorded to the AMPS or any other securities issued
by ▇▇▇▇▇'▇ or by Fitch.
(h) Asset Coverage. As of the Closing Date and assuming the receipt of the
net proceeds from the sale of the AMPS, the 1940 Act Preferred Shares Asset
Coverage and the Preferred Shares Basic Maintenance Amount (each as defined in
the Charter) each will be met.
(i) Additional Documents. At Closing Time, counsel for the Underwriters
shall have been furnished with such documents and opinions as they may require
for the purpose of enabling them to pass upon the issuance and sale of the AMPS
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 Fund and the Adviser in
connection with the organization and registration of the Fund under the 1940 Act
and the issuance and sale of the AMPS as herein contemplated shall be
satisfactory in form and substance to the Representative and counsel for the
Underwriters.
(j) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement may be terminated by the Representative by notice to the Fund at any
time at or prior to Closing Time, 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 Fund and the 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, and any director, officer, employee
or affiliate thereof 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
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 Fund; 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 Fund or the
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).
(b) Indemnification of Fund, Adviser, Trustees and Officers. Each
Underwriter severally agrees to indemnify and hold harmless the Fund and the
Adviser, their respective trustees, each of the Fund's officers who signed the
Registration Statement, and each person, if any, who controls the Fund or the
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
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 Fund or the Adviser by such Underwriter
through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
(c) Indemnification for Sales Materials. In addition to the foregoing
indemnification, the Fund and the 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 of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Fund and the Adviser. 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 more than 45 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 Fund and the Adviser on the one
hand and the Underwriters on the other hand from the offering of the AMPS
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 Fund and the 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 Fund and the Adviser on the one
hand and the Underwriters on the other hand in connection with the offering of
the AMPS pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the AMPS pursuant to
this Agreement (before deducting expenses) received by the Fund and the total
underwriting discount received by the Underwriters (whether from the Fund 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 AMPS as set forth on such cover.
The relative fault of the Fund and the 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 Fund or the 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 Fund, the 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 AMPS 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 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
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 Fund and each director of the Adviser, respectively, each
officer of the Fund who signed the Registration Statement, and each person, if
any, who controls the Fund or the 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 Fund and the Adviser, respectively. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number of AMPS 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 Fund or the 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 Fund or the Adviser, and shall survive
delivery of the AMPS to the Underwriters.
Section 9. Termination of Agreement.
(a) Termination; General. The Representative may terminate this Agreement,
by notice to the Fund, 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 Fund or the 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 Representative, impracticable or inadvisable to market the AMPS
or to enforce contracts for the sale of the AMPS, or (iii) if trading in the
Common Shares of the Fund has been suspended or materially limited by the
Commission or the AMEX, or if trading generally on the New York Stock Exchange
or the American Stock Exchange 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 to
purchase the AMPS which it or they are obligated to purchase under this
Agreement (the "Defaulted AMPS"), the Representative 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 AMPS in such amounts as may be agreed upon and
upon the terms herein set forth; if, however, the Representative shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted AMPS does not exceed 10% of the number of
AMPS 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 AMPS exceeds 10% of the number of AMPS to be
purchased on such date, this Agreement 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, either the Representative or the Fund shall have the right to
postpone Closing Time 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. 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
Representative, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., 4 World Financial Center, New York, New
York 10080, attention of Equity Capital Markets; and notices to the Fund or the
Adviser shall be directed, as appropriate, to the office of Evergreen Investment
Management Company, LLC, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, attention of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇.
Section 12. Parties.
This Agreement shall each inure to the benefit of and be binding upon
the Underwriters, the Fund, the 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 Fund, the Adviser and their respective successors and the
controlling persons and officers and trustees 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 Fund, the
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
purchaser of AMPS from any Underwriter shall be deemed to be a successor by
reason merely of such purchase.
Section 13. 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 14. 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.
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 Fund and the Adviser in accordance with its terms.
Very truly yours,
EVERGREEN INCOME ADVANTAGE FUND
By:
------------------------------------------
Name:
Title:
EVERGREEN INVESTMENT MANAGEMENT COMPANY, LLC
By:
------------------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED, as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
By:
------------------------------------------------
Authorized Signatory
For itself and as Representative of the other Underwriters named in Schedule A
hereto.
SCHEDULE A
Number of
Initial Securities
Series Series Series Series Series Series
--------- --------- -------- --------- -------- ---------
Name of Underwriter M28 W28 T7 W7 TH7 F7
-------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
----------------------------------------------------
Incorporated
................................................
Citigroup Global Markets Inc.
..........................
UBS Warburg LLC
...........................................
Wachovia Securities, Inc.
.................................
Total. --------- --------- -------- ------- -------- ----------
.............................................
SCHEDULE B
Evergreen Income Advantage Fund
[ ] Auction Market Preferred Shares
Series M28
Series W28
Series T7
Series W7
Series TH7
Series F7
Liquidation Preference $25,000 per Share
1. The initial public offering price per share for the AMPS, determined
as provided in said Section 2, shall be $25,000.
2. The purchase price per share for the AMPS to be paid by the several
Underwriters shall be $24,750, such discount from the initial public offering
price representing the commission to be paid to the Underwriters for their
commitment hereunder of $250.
3. The initial dividend rate of the AMPS, Series M28 shall be [ ]% per
annum.
4. The initial dividend rate of the AMPS, Series W28 shall be [ ]% per
annum.
5. The initial dividend rate of the AMPS, Series T7 shall be [ ]% per
annum.
6. The initial dividend rate of the AMPS, Series W7 shall be [ ]% per
annum.
7. The initial dividend rate of the AMPS, Series TH7 shall be [ ]% per
annum.
8. The initial dividend rate of the AMPS, Series F7 shall be [ ]% per
annum.
Exhibit A
FORM OF OPINION OF FUND'S
COUNSEL TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(A) With respect to the Fund:
(i) The Fund has been duly organized and is validly existing as a statutory
trust in good standing under the laws of the State of Delaware.
(ii) The Fund has the 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.
(iii) The Fund is duly qualified as a foreign trust 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.
(iv) To the best of our knowledge, the Fund does not have any subsidiaries.
(v) The authorized, issued and outstanding AMPS of the Fund is as set forth
in the Prospectus under the caption "Description of AMPS" (except for subsequent
issuances, if any, pursuant to the Purchase Agreement); all issued and
outstanding AMPS of the Fund have been duly authorized and validly issued and
are fully paid and non-assessable, except as provided for in the Fund's
declaration of trust, and have been offered and sold or exchanged by the Fund in
compliance with all applicable laws (including, without limitation, federal and
state securities laws); the AMPS conform as to legal matters to all statements
relating thereto contained in the Prospectus and such description conforms to
the rights set forth in the instruments defining the same; and none of the AMPS
of the Fund was issued in violation of the preemptive or other similar rights of
any securityholder of the Fund.
(vi) The AMPS to be purchased by the Underwriters from the Fund have been
duly authorized for issuance and sale to the Underwriters pursuant to the
Purchase Agreement and, when issued and delivered by the Fund pursuant to the
Purchase Agreement against payment of the consideration set forth in the
Purchase Agreement, will be validly issued and fully paid and non-assessable,
except as provided for in the Fund's declaration of trust, and no holder of the
AMPS is or will be subject to personal liability by reason of being such a
holder.
(vii) The issuance of the AMPS is not subject to preemptive or other
similar rights of any securityholder of the Fund.
(viii) The Purchase Agreement has been duly authorized, executed and
delivered by the Fund.
(ix) The Registration Statement, including any Rule 462(b) Registration
Statement, has been declared effective under the 1933 Act and the 1940 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; and, to
the best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement or any Rule 462(b) Registration Statement has been issued
under the 1933 Act, and, to the best of our knowledge, no 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 threatened by the Commission.
(x) The Registration Statement, including any Rule 462(b) Registration
Statement, the Rule 430A Information and the Rule 434 Information, as
applicable, the Prospectus and each amendment or supplement to the Registration
Statement and Prospectus as of their respective effective or issue dates (other
than the financial statements and supporting schedules included therein or
omitted therefrom, as to which we need express no opinion), and the notification
on Form N-8A complied as to form in all material respects with the requirements
of the 1933 Act, the 1940 Act and the Rules and Regulations.
(xi) If Rule 434 has been relied upon, the Prospectus was not "materially
different" as such term is used in Rule 434, from the prospectus included in the
Registration Statement at the time it became effective.
(xii) The form of certificate used to evidence the AMPS complies in all
material respects with all applicable statutory requirements, with any
applicable requirements of the declaration of trust and bylaws of the Fund.
(xiii) To the best of our knowledge, there is not pending or threatened any
action, suit, proceeding, inquiry or investigation, to which the Fund is a
party, or to which the property of the Fund is subject, before or brought by any
court or governmental agency or body, domestic or foreign, 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 Fund or the consummation of the transactions contemplated in the
Purchase Agreement or the performance by the Fund of its obligations thereunder.
(xiv) The information in the Prospectus under "Description of AMPS" and
"Tax Matters" and in the Registration Statement under Item 29 (Indemnification),
to the extent that it constitutes matters of law, summaries of legal matters,
the Fund's declaration of trust and bylaws or legal proceedings, or legal
conclusions, has been reviewed by us and is correct in all material respects.
(xv) Each of the Management Agreement, the Administration Agreement, the
Custodian Agreement, the Transfer and Dividend Disbursing Agency and Registrar
Agreement, the Auction Agency Agreement and the Purchase Agreement comply in all
material respects with all applicable provisions of the 1940 Act, Advisers Act,
the Rules and Regulations and the Advisers Act Rules and Regulations.
(xvi) The Fund is duly registered with the Commission under the 1940 Act as
a closed-end diversified management investment company; and, to the best of our
knowledge, no order of suspension or revocation of such registration has been
issued or proceedings therefor initiated or threatened by the Commission.
(xvii) To the best of our knowledge, no person is serving as an officer,
trustee or investment adviser of the Fund except in accordance with the 1940 Act
and the Rules and Regulations and the Investment Advisers Act and the Advisers
Act Rules and Regulations. Except as disclosed in the Registration Statement and
Prospectus (or any amendment or supplement to either of them), to the best of
our knowledge, no trustee of the Fund is an "interested person" (as defined in
the 1940 Act) of the Fund or an "affiliated person" (as defined in the 1940 Act)
of an Underwriter.
(xviii) There are no statutes or regulations that are required to be
described in the Prospectus that are not described as required.
(xix) All descriptions in the Registration Statement of contracts and other
documents to which the Fund is a party are accurate in all material respects. To
the best of our knowledge, there are no franchises, contracts, indentures,
mortgages, loan agreements, notes, leases or other instruments required to be
described or referred to in the Registration Statement or to be filed as
exhibits thereto other than those described or referred to therein or filed or
incorporated by reference as exhibits thereto, and the descriptions thereof or
references thereto are correct in all material respects.
(xx) To the best of our knowledge, the Fund is not in violation of its
declaration of trust or bylaws and no default by the Fund exists in the due
performance or observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan agreement, note,
lease or other agreement or instrument that is described or referred to in the
Registration Statement or the Prospectus or filed or incorporated by reference
as an exhibit to the Registration Statement.
(xxi) No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority or
agency (other than under the 1933 Act, the 1934 Act, the 1940 Act and the Rules
and Regulations, which have been obtained, or as may be required under the
securities or blue sky laws of the various states, as to which we need express
no opinion) is necessary or required in connection with the due authorization,
execution and delivery of the Purchase Agreement or for the offering, issuance
or sale of the Securities or the consummation of the transactions contemplated
by this Agreement.
(xxii) The execution, delivery and performance of the Purchase Agreement
and the consummation of the transactions contemplated in the Purchase Agreement
and in the Registration Statement (including the issuance and sale of the AMPS
and the use of the proceeds from the sale of the AMPS as described in the
Prospectus under the caption "Use of Proceeds") and compliance by the Fund with
its obligations under the Purchase Agreement do not and will not, whether with
or without the giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined in Section
1(a)(xii) of the Purchase Agreement) under or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Fund pursuant to any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or any other agreement or instrument, known to us,
to which the Fund is a party or by which it or any of them may be bound, or to
which any of the property or assets of the Fund is subject, nor will such action
result in any violation of the provisions of the charter or bylaws of the Fund,
or any applicable law, statute, rule, regulation, judgment, order, writ or
decree, known to us, of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Fund or any of its properties,
assets or operations.
(xxiii) The Purchase Agreement, the Management Agreement, the
Administration Agreement, the Custodian Agreement, the Transfer and Dividend
Disbursing Agency and Registrar Agreement and the Auction Agency Agreement have
each been duly authorized by all requisite action on the part of the Fund,
executed and delivered by the Fund, 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 Transfer and Dividend
Disbursing Agency and Registrar Agreement and the Auction Agency Agreement, each
of the Management Agreement, the Administration Agreement, the Custodian
Agreement, the Transfer and Dividend Disbursing Agency and Registrar Agreement
and the Auction Agency Agreement constitutes a valid and binding agreement of
the Fund, 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.
FORM OF OPINION OF ADVISER'S
COUNSEL TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(B) With respect to the Adviser:
(i) The Adviser has been duly organized and is validly existing as a
limited liability company in good standing under the laws of the State of
Delaware.
(ii) The Adviser has full 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.
(iii) The Adviser is duly qualified as a foreign company 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 to so qualify
would not result in a Material Adverse Effect.
(iv) The Adviser is duly registered with the Commission as an investment
adviser under the Advisers Act and is not prohibited by the Advisers Act, the
Advisers Act Rules and Regulations, the 1940 Act or the Rules and Regulations
from acting under the Management Agreement for the Fund as contemplated by the
Prospectus.
(v) The Purchase Agreement, the Management Agreement and the Additional
Compensation Agreement have been duly authorized, executed and delivered by the
Adviser, and the Management Agreement constitutes a valid and binding obligation
of the 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).
(vi) To the best of our knowledge, there is not pending or threatened any
action, suit, proceeding, inquiry or investigation, to which the Adviser is a
party, or to which the property of the Adviser is subject, before or brought by
any court or governmental agency or body, domestic or foreign, which might
reasonably be expected to result in any material adverse change in the
condition, financial or otherwise, in the earnings, business affairs or business
prospects of the Adviser, materially and adversely affect the properties or
assets of the Adviser or materially impair or adversely affect the ability of
the Adviser to function as an investment adviser or perform its obligations
under the Management Agreement or which is required to be disclosed in the
Registration Statement or the Prospectus.
(vii) To the best of our knowledge, there are no franchises, contracts,
indentures, mortgages, loan agreements, notes, leases or other instruments
required to be described or referred to in the Registration Statement or to be
filed as exhibits thereto other than those described or referred to therein or
filed or incorporated by reference as exhibits thereto, and the descriptions
thereof or references thereto are correct in all material respects.
(viii) To the best of our knowledge, the Adviser is not in violation of its
articles of organization, bylaws or other organizational documents and no
default by the Adviser exists in the due performance or observance of any
material obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described or referred to in the Registration Statement or the
Prospectus or filed or incorporated by reference as an exhibit to the
Registration Statement.
(ix) No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority or
agency, domestic or foreign (other than under the 1933 Act, the 1940 Act and the
Rules and Regulations, which have been obtained, or as may be required under the
securities or blue sky laws of the various states, as to which we need express
no opinion) is necessary or required in connection with the due authorization,
execution and delivery of the Purchase Agreement.
(x) The execution, delivery and performance of the Purchase Agreement and
the consummation of the transactions contemplated in the Purchase Agreement and
in the Registration Statement and compliance by the Adviser with their
obligations under the Purchase Agreement do not and will not, whether with or
without the giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined in Section
1(a)(xii) of the Purchase Agreement) under or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Adviser pursuant to any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or any other agreement or instrument, known to us,
to which the Adviser is a party or by which it or any of them may be bound, or
to which any of the property or assets of the Adviser is subject (except for
such conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a Material Adverse Effect), nor will such action result in any
violation of the provisions of the charter or bylaws of the Adviser, or any
applicable law, statute, rule, regulation, judgment, order, writ or decree,
known to us, of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Adviser or any of its properties, assets
or operations.
In addition, we have participated in the preparation of the
Registration Statement and the Prospectus and participated in discussions with
certain officers, trustees and employees of the Fund, representatives of KPMG
LLP, the independent accountants who examined the statement of assets and
liabilities of the Fund included or incorporated by reference in the
Registration Statement and the Prospectus, and you and your representatives and
we have reviewed certain Fund records and documents. While we have not
independently verified and are not passing upon, and do not assume any
responsibility for, the accuracy, completeness or fairness of the information
contained in the Registration Statement and the Prospectus, except to the extent
necessary to enable us to give the opinions with respect to the Fund in
paragraphs (A)(v), (xiv) and (xix), on the basis of such participation and
review, nothing has come to our attention that would lead us to believe that the
Registration Statement (except for financial statements, supporting schedules
and other financial data included therein or omitted therefrom, as to which we
do not express any belief), at the time such Registration Statement became
effective, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus (except for financial
statements, supporting schedules and other financial data included therein or
omitted therefrom, as to which we do not express any belief), at the time the
Prospectus was issued, or at the Closing Time, included or includes an untrue
statement of a material fact or omitted or omits 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.