[ ] Shares
FIRST TRUST/FOUR CORNERS SENIOR
FLOATING RATE INCOME FUND
Common Shares of Beneficial Interest
UNDERWRITING AGREEMENT
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September [ ], 2003
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc.
As Representative of the Several Underwriters
c/o Raymond ▇▇▇▇▇ & Associates, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
The undersigned, First Trust/Four Corners Senior Floating Rate Income
Fund, a voluntary association with transferable shares organized and existing
under and by virtue of the laws of The Commonwealth of Massachusetts (commonly
referred to as a Massachusetts business trust) (the "Fund"), First Trust
Advisors L.P., an Illinois limited partnership (the "Adviser"), and Four Corners
Capital Management, LLC, a Delaware limited liability company (the
"Sub-Adviser"), address you as Underwriters and as the Representative (the
"Representative") of each of the other persons, firms and corporations, if any,
listed in Schedule I hereto (herein collectively called "Underwriters"). The
Fund proposes to issue and sell an aggregate of [ ] shares of its common shares
of beneficial interest, $.01 par value per share (the "Firm Shares"), to the
several Underwriters. The Fund also proposes to sell upon the terms and
conditions contained in Section 2 hereof, up to [ ] additional common shares
(the "Additional Shares" which together with the Firm Shares are hereinafter
collectively referred to as the "Shares").
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The Fund, the Adviser and the Sub-Adviser wish to confirm as follows their
agreements with you and the other several Underwriters on whose behalf you are
acting in connection with the several purchases of the Shares by the
Underwriters.
The Fund has entered into an investment advisory agreement with the
Adviser dated [ ] (the "Advisory Agreement"), an investment sub-advisory
agreement with the Adviser and the Sub-Adviser dated [ ](the "Sub-Advisory
Agreement"), a Custodian Contract with PFPC Trust Company dated [ ] (the
"Custodian Contract"), an Administration and Accounting Services Agreement with
PFPC Inc. (the "Administration Agreement"), a Registrar Transfer Agency
Agreement with PFPC Inc. dated [ ] (the "Transfer Agency Agreement") and a
Subscription Agreement with First Trust Portfolios, L.P. dated [ ] (the
"Subscription Agreement"). Collectively, the Advisory Agreement, Sub-Advisory
Agreement, Custodian Contract, Administration Agreement, Transfer Agency
Agreement and Subscription Agreement are herein referred to as the "Fund
Agreements." Collectively, the Advisory Agreement and the Sub-Advisory Agreement
are herein referred to as the "Advisory Agreements." This Underwriting Agreement
is herein referred to as the "Agreement."
1. Registration Statement and Prospectus. The Fund has prepared and filed
with the Securities and Exchange Commission (the "Commission") in accordance
with the provisions of the Securities Act of 1933, as amended (the "1933 Act"),
the Investment Company Act of 1940, as amended (the "1940 Act"), and the rules
and regulations of the Commission under the 1933 Act (the "1933 Act Rules and
Regulations") and the 1940 Act (the "1940 Act Rules and Regulations" and
together with the 1933 Act Rules and Regulations, the "Rules and Regulations") a
registration statement on Form N-2 (File No. 333-105251 under the 1933 Act) (the
"registration statement"), including a prospectus and statement of additional
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information relating to the Shares, and a notification of registration of the
Fund as an investment company under the 1940 Act on Form N-8A (File No.
811-21344 under the 1940 Act, the "1940 Act Notification"), and may pursuant to
the Rules and Regulations prepare and file an additional registration statement
relating to a portion of the Shares pursuant to Rule 462(b) of the 1933 Act
Rules and Regulations (a "Rule 462 registration statement"). The term
"Registration Statement" as used in this Agreement means the registration
statement (including all financial schedules and exhibits), as amended at the
time it becomes effective under the 1933 Act or, if the registration statement
became effective under the 1933 Act prior to the execution of this Agreement, as
amended or supplemented thereto, prior to the execution of this Agreement and
includes any information deemed to be included by Rule 430A under the 1933 Act
Rules and Regulations. If it is contemplated, at the time this Agreement is
executed, that a post-effective amendment to the registration statement will be
filed under the 1933 Act and must be declared effective before the offering of
Shares may commence, the term "Registration Statement" as used in this Agreement
means the Registration Statement as amended by said post-effective amendment. If
the Fund has filed a Rule 462 registration statement, then the reference herein
to the term "Registration Statement" shall include such Rule 462 registration
statement. The term "Prospectus" as used in this Agreement means the prospectus
and statement of additional information in the forms included in the
Registration Statement or, if the prospectus and statement of additional
information included in the Registration Statement omit information in reliance
on Rule 430A under the 1933 Act Rules and Regulations and such information is
included in a prospectus and statement of additional information filed with the
Commission pursuant to Rule 497(h) under the 1933 Act Rules and Regulations, the
term "Prospectus" as used in this Agreement means the prospectus and statement
of additional information in the forms included in the Registration Statement as
supplemented by the addition of the information contained in the prospectus
(including the statement of additional information) filed with the Commission
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pursuant to Rule 497(h). The term "Prepricing Prospectus" as used in this
Agreement means the prospectus and statement of additional information subject
to completion in the form included in the registration statement at the time of
the initial filing of the registration statement with the Commission and as such
prospectus and statement of additional information shall have been amended from
time to time prior to the date of the Prospectus, together with any other
prospectus (including any other statement of additional information) relating to
the Fund other than the Prospectus. The terms "Registration Statement,"
"Prospectus" and "Prepricing Prospectus" shall also include any financial
statements and other information included or incorporated by reference therein.
The Fund has furnished the Representative with copies of such Registration
Statement, each amendment to such Registration Statement filed with the
Commission and each Prepricing Prospectus.
2. Agreements to Sell and Purchase. The Fund hereby agrees, subject to all
the terms and conditions set forth herein, to issue and to sell to each
Underwriter and, upon the basis of the representations, warranties and
agreements of the Fund, the Adviser and the Sub-Adviser herein contained and
subject to all of the other terms and conditions set forth herein, each
Underwriter agrees, severally and not jointly, to purchase from the Fund at a
purchase price of $19.10 per Share (the "Price per Share"), the number of Shares
set forth opposite the name of such Underwriter in Schedule I hereto.
The Fund also agrees, subject to all the terms and conditions set forth
herein, to issue and to sell to the Underwriters and, upon the basis of the
representations, warranties and agreements of the Fund, the Adviser and the
Sub-Adviser herein contained and subject to all the terms and conditions set
forth herein, the Underwriters shall have the right to purchase from the Fund,
at the purchase price per share, pursuant to an option (the "over-allotment
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option") which may be exercised at any time and from time to time prior to 9:00
A.M., New York time, on the 45th day after the date of the Prospectus (or if
such 45th day shall be a Saturday or a Sunday or a holiday, on the next business
day thereafter when the American Stock Exchange (the "AMEX") is open for
trading), Additional Shares. Additional Shares may be purchased solely for the
purpose of covering over-allotments made in connection with the offering of the
Shares. Upon any exercise of the over-allotment option, upon the basis of the
representations, warranties and agreements of the Fund, the Adviser and the
Sub-Adviser, herein contained and subject to all of the other terms and
conditions set forth herein, each Underwriter agrees, severally and not jointly,
to purchase from the Fund the number of Additional Shares (subject to such
adjustments as you may determine to avoid fractional shares) which bears the
same proportion to the number of Additional Shares to be purchased by the
Underwriters as the number of Firm Shares set forth opposite the name of such
Underwriter in Schedule I (or such number of Firm Shares increased as set forth
in Section 11 hereof) bears to the aggregate number of Firm Shares.
3. Terms of Public Offering. The Fund, the Adviser and the Sub-Adviser
have been advised by you that the Underwriters propose to make a public offering
of their respective portions of the Shares as soon after the Registration
Statement and this Agreement have become effective as in your judgment is
advisable and initially to offer the Shares upon the terms set forth in the
Prospectus.
4. Delivery of Shares and Payments Therefor.
(a) Delivery to the Underwriters of and payment to the Fund for the
Firm Shares and compensation of the Underwriters with respect thereto
shall be made at the offices of ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ LLP, Suite 1700, ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ at 9:00 a.m. New York time on [ ],
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2003 (the "Closing Date"). The place of closing for the Firm Shares and
the Closing Date may be varied by agreement between you and the Fund.
(b) Delivery to the Underwriters of and payment to the Fund for any
Additional Shares to be purchased by the Underwriters and compensation of
the Underwriters with respect thereto shall be made at the aforementioned
office of ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ LLP at such time on such date (an "Option
Closing Date"), which may be the same as the Closing Date, but shall in no
event be earlier than the Closing Date nor earlier than two nor later than
three business days after the giving of the notice hereinafter referred
to, as shall be specified in a written notice from you on behalf of the
Underwriters to the Fund of the Underwriters' determination to purchase a
number, specified in said notice, of Additional Shares. The place of
closing for any Additional Shares and the Option Closing Date for such
Additional Shares may be varied by agreement between you and the Fund.
(c) The Shares shall be registered in such names and in such
denominations as the Underwriters shall request prior to 1:00 P.M., New
York time, (i) with respect to the Firm Shares, on the second business day
preceding the Closing Date, and (ii) with respect to the Additional
Shares, on the day of the giving of the written notice in respect of such
Additional Shares. Certificates for shares will be made available to you
in New York for inspection and packaging not later than 9:00 A.M., New
York, on the business day next preceding the Closing Date or any Option
Closing Date, as the case may be. The certificates evidencing the Firm
Shares and any Additional Shares to be purchased hereunder shall be
delivered to you on the Closing Date or the Option Closing Date, as the
case may be, against payment of the purchase price therefor in immediately
available funds.
5. Agreements of the Fund, the Adviser and the Sub-Adviser. The Fund, the
Adviser and the Sub-Adviser, jointly and severally, agree with the several
Underwriters as follows:
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(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment
thereto to be declared effective under the 1933 Act before the offering of
the Shares may commence in compliance therewith, the Fund will use its
best efforts to cause the Registration Statement or such post-effective
amendment to become effective under the 1933 Act as soon as possible. If
the Registration Statement has become effective and the Prospectus
contained therein omits certain information at the time of effectiveness
pursuant to Rule 430A of the 1933 Act Rules and Regulations, the Fund will
file a prospectus including such information pursuant to Rule 497(h) of
the 1933 Act Rules and Regulations, as promptly as practicable, but no
later than the second business day following the earlier of the date of
the determination of the offering price of the Shares or the date the
Prospectus is first used after the effective date of the Registration
Statement in connection with a public offering or sale. If the
Registration Statement has become effective and the Prospectus contained
therein does not so omit such information, the Fund will file a Prospectus
or certification pursuant to Rule 497(c) or (j), as the case may be, of
the 1933 Act Rules and Regulations as promptly as practicable, but no
later than the fifth business day following the date of the later of the
effective date of the Registration Statement or the commencement of the
public offering of the Shares after the effective date of the Registration
Statement. The Fund will advise you promptly and, if requested by you,
will confirm such advice in writing (i) when the Registration Statement or
such post-effective amendment has become effective, (ii) when the
Prospectus has been timely filed pursuant to Rule 497(c) or Rule 497(h) of
the 1933 Act Rules and Regulations or (iii) when the certification
permitted pursuant to Rule 497(j) of the 1933 Act Rules and Regulations
has been timely filed, whichever is applicable.
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(b) The Fund, and in the case of (iii)(B) below, the Adviser or the
Sub-Adviser, will advise you promptly and, if requested by you, will
confirm such advice in writing: (i) of any request made by the Commission
for amendment of or a supplement to the Registration Statement, the
Prospectus or any Prepricing Prospectus (or any amendment or supplement to
any of the foregoing) or for additional information, (ii) of the issuance
by the Commission, the National Association of Securities Dealers, Inc.
(the "NASD"), any state securities commission, any national securities
exchange, any arbitrator, any court or any other governmental, regulatory,
self-regulatory or administrative agency or any official of any order
suspending the effectiveness of the Registration Statement, prohibiting or
suspending the use of the Prospectus, any Prepricing Prospectus or any
sales material (as hereinafter defined), of any notice pursuant to Section
8(e) of the 1940 Act, of the suspension of qualification of the Shares for
offering or sale in any jurisdiction, or the initiation or contemplated
initiation of any proceeding for any such purposes, (iii) of receipt by
(A) the Fund, any affiliate of the Fund or any representatives or attorney
of the Fund of any other material communication from the Commission, or
(B) the Fund, the Adviser, the Sub-Adviser, any affiliate of the Fund, the
Adviser or the Sub-Adviser or any representatives or attorney of the Fund,
the Adviser or the Sub-Adviser of any other material communication from
the Commission, the NASD, any state securities commission, any national
securities exchange, any arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or any official
relating, in the case of either clause (A) or (B), to the Fund (if such
communication relating to the Fund is received by such person within three
years after the date of this Agreement), the Registration Statement, the
1940 Act Notification, the Prospectus, any Prepricing Prospectus, any
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sales material (as hereinafter defined)(or any amendment or supplement to
any of the foregoing), this Agreement, any of the Fund Agreements or
either of the Advisory Agreements, and (iv) within the period of time
referred to in paragraph (f) below, of any material, adverse change in the
condition (financial or other), business, properties, net assets or
results of operations ("Material Adverse Change") of the Fund or any event
which should reasonably be expected to have a material adverse effect on
the ability of the Adviser or the Sub-Adviser to perform their respective
obligations under this Agreement or either of the Advisory Agreements, as
the case may be, (other than as a result of changes in market conditions
generally) or of the happening of any event which makes any statement of a
material fact made in the Registration Statement, the Prospectus, any
Prepricing Prospectus or any sales material (or any amendment or
supplement to any of the foregoing) untrue or which requires the making of
any additions to or changes in the Registration Statement, the Prospectus,
any Prepricing Prospectus or any sales material (or any amendment or
supplement to any of the foregoing) in order to state a material fact
required by the 1933 Act, the 1940 Act or the Rules and Regulations to be
stated therein or necessary in order to make the statements therein (in
the case of a prospectus or any sales material, in light of the
circumstances under which they were made) not misleading or of the
necessity to amend or supplement the Registration Statement, the
Prospectus, any Prepricing Prospectus or any sales material (or any
amendment or supplement to any of the foregoing) to comply with the 1933
Act, the 1940 Act, the Rules and Regulations or any other law or order of
any court or regulatory body. If at any time the Commission shall issue
any order suspending the effectiveness of the Registration Statement,
prohibiting or suspending the use of the Prospectus or any sales material
(or any amendment or supplement to any of the foregoing) or suspending the
qualification of the Shares for offering or sale in any jurisdiction, the
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Fund, the Adviser and the Sub-Adviser will use their best efforts to
obtain the withdrawal of such order at the earliest possible time. If at
any time the NASD, any national securities exchange, any state securities
commission, any arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or any official shall
issue any order suspending the effectiveness of the Registration
Statement, prohibiting or suspending the use of the Prospectus or any
sales material (or any amendment or supplement to any of the foregoing) or
suspending the qualification of the Shares for offering or sale in any
jurisdiction, the Fund, the Adviser and the Sub-Adviser will use their
respective best efforts to obtain the withdrawal of such order at the
earliest possible time.
(c) The Fund will furnish to you, without charge, three signed
copies of the registration statement and the 1940 Act Notification as
originally filed with the Commission and of each amendment thereto,
including financial statements and all exhibits thereto and will also
furnish to you, without charge, such number of conformed copies of the
registration statement as originally filed and of each amendment thereto,
with or without exhibits, as you may reasonably request.
(d) The Fund will not (i) file any amendment to the registration
statement or the Registration Statement or make any amendment or
supplement to the Prospectus, any Prepricing Prospectus or any sales
material (or any amendment or supplement to any of the foregoing) of which
you shall not previously have been advised or to which you shall
reasonably object within a reasonable time after being so advised or (ii)
so long as, in the opinion of counsel for the Underwriters, a Prospectus
is required to be delivered in connection with sales by any Underwriter or
dealer, file any information, documents or reports pursuant to the 1933
Act, the 1940 Act or the Securities Exchange Act of 1934, as amended (the
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"1934 Act"), without delivering a copy of such information, documents or
reports to you, as Representative of the Underwriters, prior to or
concurrently with such filing.
(e) Prior to the execution and delivery of this Agreement, the Fund
has delivered to you, without charge, in such quantities as you have
reasonably requested, copies of each form of any Prepricing Prospectus.
The Fund consents to the use, in accordance with the provisions of the
1933 Act and with the securities or Blue Sky laws of the jurisdictions in
which the Shares are offered by the several Underwriters and by dealers,
prior to the date of the Prospectus, of each Prepricing Prospectus so
furnished by the Fund.
(f) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time, for such period as in the
opinion of counsel for the Underwriters a prospectus is required by the
1933 Act to be delivered in connection with sales of Shares by any
Underwriter or dealer, the Fund will expeditiously deliver to each
Underwriter and each dealer, without charge, as many copies of the
Prospectus (and of any amendment or supplement thereto) as you may
reasonably request. The Fund consents to the use of the Prospectus (and of
any amendments or supplements thereto) in accordance with the provisions
of the 1933 Act and with the securities or Blue Sky laws of the
jurisdictions in which the Shares are offered by the several Underwriters
and by all dealers to whom Shares may be sold, both in connection with the
offering or sale of the Shares and for such period of time thereafter as
the Prospectus is required by law to be delivered in connection with sales
of Shares by any Underwriter or dealer. If during such period of time any
event shall occur that in the judgment of the Fund or in the opinion of
counsel for the Underwriters is required to be set forth in the
Registration Statement or the Prospectus (as then amended or supplemented)
or should be set forth therein in order to make the statements therein (in
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the case of the Prospectus, in light of the circumstances under which they
were made) not misleading or if it is necessary to supplement or amend the
Registration Statement or the Prospectus to comply with the 1933 Act, the
1940 Act, the Rules and Regulations or any other law, rule or regulation,
the Fund will forthwith notify you of such event, prepare and, subject to
the provisions of paragraph (d) above, promptly file with the Commission
an appropriate amendment or supplement thereto and will expeditiously
furnish to the Underwriters and dealers, without charge, such number of
copies thereof as they may reasonably request. In the event that the
Registration Statement or the Prospectus is to be amended or supplemented,
the Fund, if requested by you, will promptly issue a press release
announcing or disclosing the matters to be covered by the proposed
amendment or supplement.
(g) The Fund will cooperate with you and with counsel for the
Underwriters in connection with the registration or qualification of the
Shares for offering and sale by the several Underwriters and by dealers
under the securities or Blue Sky laws of such jurisdictions as you may
designate and will file such consents to service of process or other
documents necessary or appropriate in order to effect such registration or
qualification; provided, however, that none of the Fund, the Adviser or
the Sub-Adviser shall be obligated to (i) qualify as a foreign entity in
any jurisdiction where it is not so qualified or (ii) take any action that
would subject the Fund, the Adviser or the Sub-Adviser to service of
process in suits other than those arising out of the offering or sale of
Shares or Additional Shares.
(h) Each of the Adviser and the Sub-Adviser will make generally
available to the Underwriters its staff, for assistance with roadshow
presentations as the Underwriters may reasonably request.
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(i) As soon as practicable, but in no event later than the last day
of the 18th full calendar month following the calendar quarter in which
the effective date of the Registration Statement falls, the Fund will make
generally available to its security holders an earnings statement, which
need not be audited, which earnings statement shall satisfy the provisions
of Section 11(a) of the 1933 Act and Rule 158 of the 1933 Act Rules and
Regulations.
(j) The Fund will comply with the undertaking set forth in paragraph
6 of Item 33 of Part C of the Registration Statement.
(k) During the period of three years hereafter, the Fund will
furnish or will have furnished to you (i) as soon as available, a copy of
each report of the Fund mailed to shareholders or filed with the
Commission or furnished to the AMEX and (ii) from time to time such other
information concerning the Fund as you may reasonably request.
(l) If this Agreement shall terminate or be terminated after
execution pursuant to any provisions hereof (otherwise than pursuant to
the second paragraph of Section 11 hereof or by notice given by you
terminating this Agreement pursuant to Section 12 hereof) or if this
Agreement shall be terminated by the Underwriters because of (i) any
failure or refusal on the part of the Fund, the Adviser or the Sub-Adviser
to comply with any term or fulfill any of the conditions of this Agreement
required to be complied with or fulfilled by them, or (ii) the
non-occurrence of any other condition of this Agreement required to occur
in connection with the transactions contemplated hereby, the Fund, the
Adviser and the Sub-Adviser, jointly and severally, agree to reimburse the
Representative for all out-of-pocket expenses not to exceed the amounts
set forth in Section 13 of this Agreement (including fees and expenses of
counsel for the Underwriters) incurred by you in connection herewith.
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(m) The Fund will direct the investment of the net proceeds of the
offering of the Shares (i) in accordance with the description set forth in
the Prospectus and (ii) in such a manner as to comply with the investment
objectives, policies and restrictions of the Fund as described in the
Prospectus.
(n) The Fund will file the requisite copies of the Prospectus with
the Commission in a timely fashion pursuant to Rule 497(c) or Rule 497(h)
of the 1933 Act Rules and Regulations, whichever is applicable or, if
applicable, will file in a timely fashion the certification permitted by
Rule 497(j) of the 1933 Act Rules and Regulations and will advise you of
the time and manner of such filing.
(o) The Fund will use its best efforts to have the shares listed,
subject to notice of issuance, on the AMEX concurrently with the
effectiveness of the Registration Statement and to comply with the rules
or regulations of such exchange.
(p) Except as provided in this Agreement or pursuant to any dividend
reinvestment plan of the Fund, none of the Fund, the Adviser, the
Sub-Adviser or their respective officers, directors, trustees, members,
managers or partners will sell, contract to sell or otherwise dispose of,
any shares of beneficial interest of the Fund or any securities
convertible into or exercisable or exchangeable for shares of beneficial
interest of the Fund or grant any options or warrants to purchase shares
of beneficial interest of the Fund, for a period of 180 days after the
date of the Prospectus, without the prior written consent of the
Representative.
(q) Except as stated in this Agreement and in the Prospectus, none
of the Fund, the Adviser or the Sub-Adviser will take, directly or
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indirectly, any action designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the price of the
Shares.
(r) The Fund will direct the investment of the proceeds of the
offering of the Shares so as to comply with the requirements of Subchapter
M of the Internal Revenue Code of 1986, as amended (the "Code"), to
qualify as a regulated investment company under the Code.
6. Representations and Warranties of the Fund, the Adviser and the
Sub-Adviser. The Fund and the Adviser, jointly and severally, with respect to
this Section 6 and the Sub-Adviser jointly and severally with the Fund and the
Adviser with respect to paragraphs (a), (b), (e), (f), (h), (j), (m), (p), (q),
(s), (t) and (u) of this Section 6, and severally with respect to paragraphs
(c), (g), (k), (n), (o) and (x) of this Section 6, hereby represent and warrant
to each Underwriter that:
(a) Each Prepricing Prospectus included as part of the registration
statement as originally filed or as part of any amendment or supplement
thereto or filed pursuant to Rule 497 of the 1933 Act Rules and
Regulations, complied when so filed in all material respects with the
provisions of the 1933 Act, the 1940 Act and the Rules and Regulations and
the Commission has not issued any order preventing or suspending the use
of the Prepricing Prospectus.
(b) The registration statement in the form in which it became or
becomes effective and also in such form as it may be when any
post-effective amendment thereto shall become effective, the Prospectus
and any amendment or supplement thereto when filed with the Commission
under Rule 497 of the 1933 Act Rules and Regulations and the 1940 Act
Notification when originally filed with the Commission and any amendment
or supplement thereto when filed with the Commission complied or will
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comply in all material respects with the provisions of the 1933 Act, the
1940 Act and the Rules and Regulations and each of the Registration
Statement and the Prospectus (or any supplement or amendment to either of
them) did not or will not at any such times contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein (in the case of the
Prospectus, in light of the circumstances under which they were made) not
misleading; except that this representation and warranty does not apply to
statements in or omissions from the Registration Statement and the
Prospectus (and any amendment or supplement to either of them) made in
reliance upon and in conformity with information relating to any
Underwriter furnished to the Fund in writing by or on behalf of any
Underwriter through you expressly for use therein.
(c) All the outstanding shares of beneficial interest of the Fund
have been duly authorized and validly issued, are fully paid and (except
as described in the Prospectus under "Certain Provisions in the
Declaration of Trust") nonassessable and are free of any preemptive or
similar rights, the Shares have been duly authorized and, when issued and
delivered to the Underwriters against payment therefor in accordance with
the terms hereof, will be validly issued, fully paid and (except as
described in the Prospectus under "Certain Provisions in the Declaration
of Trust") nonassessable and free of any preemptive or similar rights and
the shares of beneficial interest of the Fund conform in all material
respects to the description thereof in the Registration Statement or the
Prospectus (or any amendment or supplement to either of them). Except for
the Shares and the shares of beneficial interest issued in accordance with
Section 14(a) of the 1940 Act, no other shares of beneficial interest are
issued or outstanding and the capitalization of the Fund conforms in all
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material respects to the description thereof in the Registration Statement
and the Prospectus (or any amendment or supplement to either of them). The
authorized shares of beneficial interest of the Fund consist of [ ] shares
of which [ ] are outstanding.
(d) The Fund has been duly formed and is validly existing in good
standing as a business trust under the laws of The Commonwealth of
Massachusetts with full power and authority to own, lease and operate its
properties and to conduct its business as described in the Registration
Statement and the Prospectus (and any amendment or supplement to either of
them) and is duly registered and qualified to conduct business and is in
good standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration or
qualification, except where the failure so to register or to qualify does
not have a material, adverse effect on the condition (financial or other),
business, properties, net assets or results of operations, whether or not
occurring in the ordinary course of business ("Material Adverse Effect"),
of the Fund. The Fund has no subsidiaries.
(e) There are no legal or governmental proceedings pending or, to
the knowledge of the Fund, threatened, against the Fund, or to which the
Fund or any of its properties is subject, that are required to be
described in the Registration Statement or the Prospectus (and any
amendment or supplement to either of them) but are not described therein
as required and there are no agreements, contracts, indentures, leases or
other instruments that are required to be described in the Registration
Statement or the Prospectus (or any amendment or supplement to either of
them) or to be filed as an exhibit to the Registration Statement that are
not described therein or filed therewith as required by the 1933 Act, the
1940 Act or the Rules and Regulations.
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(f) The Fund is not in violation of its Declaration of Trust (the
"Declaration"), by-laws or other organizational documents or any law,
ordinance, administrative or governmental rule or regulation applicable to
the Fund or of any decree of the Commission, the NASD, any state
securities commission, any national securities exchange, any arbitrator,
any court or any other governmental, regulatory, self-regulatory or
administrative agency or any other agency or any body or official having
jurisdiction over the Fund or in breach or default in the performance of
any obligation, agreement or condition contained in any bond, debenture,
note or any other evidence of indebtedness or in any agreement, indenture,
lease or other instrument to which the Fund is a party or by which it or
any of its properties may be bound. The Fund maintains and will maintain
processes, systems and controls sufficient to provide reasonable
assurances that the Fund complies and will continue to comply with the
1933 Act, the 1933 Act Rules and Regulations, the 1940 Act and the 1940
Act Rules and Regulations, any law, ordinance, administrative or
governmental rule or regulation applicable to the Fund and any decree of
the Commission, the NASD, any state securities commission, any national
securities exchange, any arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or body or any other
agency or any body or official having jurisdiction over the Fund.
(g) Neither the issuance and sale of the Shares, the execution,
delivery or performance of this Agreement or any of the Fund Agreements by
the Fund, nor the consummation by the Fund of the transactions
contemplated hereby or thereby (i) requires any consent, approval,
authorization or order of or registration or filing with the Commission,
the NASD, any state securities commission, any national securities
exchange, any arbitrator, any court, regulatory, body, administrative
agency or other governmental body, agency or official having jurisdiction
over the Fund (except compliance with the securities or Blue Sky laws of
18
various jurisdictions which have been or will be effected in accordance
with this Agreement and except for compliance with the filing requirements
of the NASD Division of Corporate Finance) or conflicts or will conflict
with or constitutes or will constitute a breach of the Declaration,
bylaws, or other organizational documents of the Fund or (ii) (A)
conflicts or will conflict with or constitutes or will constitute a
material breach of or a default under any material agreement, indenture,
lease or other instrument to which the Fund is a party or by which it or
any of its properties may be bound or (B) violates or will violate any
statute, law, regulation or filing or judgment, injunction, order or
decree applicable to the Fund or any of its properties or will result in
the creation or imposition of any material lien, charge or encumbrance
upon any property or assets of the Fund pursuant to the terms of any
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. As of
the date hereof, the Fund is not subject to any order of any court or of
any arbitrator, governmental authority or administrative agency.
(h) Since the date as of which information is given in the
Registration Statement and the Prospectus (and any amendment or supplement
to either of them), except as otherwise stated therein, (i) there has been
no Material Adverse Change in the Fund, whether or not arising in the
ordinary course of business, (ii) there have been no transactions entered
into by the Fund other than those in the ordinary course of its business
as described in the Prospectus (and any amendment or supplement thereto)
and (iii) there has been no dividend or distribution of any kind declared,
paid or made by the Fund on any class of its shares of beneficial
interest.
(i) The accountants, Deloitte & Touche LLP who have audited the
Statement of Assets and Liabilities included in the Registration Statement
19
and the Prospectus (and any amendment or supplement to either of them),
are an independent public accounting firm as required by the 1933 Act, the
1940 Act and the Rules and Regulations.
(j) The financial statements, together with related schedules and
notes, included or incorporated by reference in the Registration Statement
or the Prospectus (or any amendment or supplement to either of them)
present fairly in all material respects the financial position of the Fund
on the basis stated in the Registration Statement at the respective dates
or for the respective periods to which they apply; such statements and
related schedules and notes have been prepared in accordance with
generally accepted accounting principles consistently applied throughout
the periods involved except as disclosed therein; and the other financial
and statistical information and data included in the Registration
Statement or the Prospectus (or any amendment or supplement thereto) are
accurately derived from such financial statements and the books and
records of the Fund.
(k) The Fund, subject to the Registration Statement having been
declared effective and the filing of the Prospectus under Rule 497 under
the 1933 Act Rules and Regulations, has taken all required action under
the 1933 Act, the 1940 Act and the Rules and Regulations to make the
public offering and consummate the sale of the Shares as contemplated by
this Agreement.
(l) The execution and delivery of and the performance by the Fund of
its obligations under this Agreement and each of the Fund Agreements have
been duly and validly authorized by the Fund and, assuming due
authorization, execution and delivery by the other parties thereto, this
Agreement and each of the Fund Agreements have been duly executed and
delivered by the Fund and each constitutes the valid and legally binding
20
agreement of the Fund, enforceable against the Fund in accordance with its
terms, except as rights to indemnity and contribution hereunder may be
limited by federal or state securities laws and subject to the
qualification that the enforceability of the Fund's obligations hereunder
and thereunder may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws relating to or affecting creditors' rights
generally and by general equitable principles.
(m) Except as disclosed in or contemplated by the Registration
Statement or the Prospectus (or any amendment or supplement to either of
them), subsequent to the respective dates as of which such information is
given in the Registration Statement and the Prospectus (and any amendment
or supplement to either of them), the Fund has not incurred any liability
or obligation, direct or contingent, or entered into any transaction, not
in the ordinary course of business, and there has not been any change in
the shares of beneficial interest of the Fund or its capitalization or any
Material Adverse Change or any development involving or which should
reasonably be expected to involve a Material Adverse Change in the Fund or
the incurrence of any debt by the Fund.
(n) The Fund has not distributed and, prior to the later to occur of
(i) the Closing Date and (ii) completion of the distribution of the
Shares, will not distribute to the public any offering material in
connection with the offering and sale of the Shares other than the
Registration Statement, the Prepricing Prospectus included in
Pre-Effective Amendment No. 3 to the registration statement, the
Prospectus and the investor sales material (as hereinafter defined) filed
with the NASD on August 15, 2003.
(o) The Fund has such licenses, permits, and authorizations of
governmental or regulatory authorities ("permits") as are necessary to own
its property and to conduct its business in the manner described in the
21
Prospectus (and any amendment or supplement thereto); the Fund has
fulfilled and performed all its material obligations with respect to such
permits and no event has occurred which allows or, after notice or lapse
of time, would allow, revocation or termination thereof or results in any
other material impairment of the rights of the Fund under any such permit,
subject in each case to such qualification as may be set forth in the
Prospectus (and any amendment or supplement thereto), except in the case
where any such impairment would not, individually or in the aggregate,
have a Material Adverse Effect on the Fund; and, except as described in
the Prospectus (and any amendment or supplement thereto), none of such
permits contains any restriction that is materially burdensome to the
Fund.
(p) The Fund maintains and will maintain a system of internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with the Board of Trustees'
general or specific authorization and with the investment policies and
restrictions of the Fund and the applicable requirements of the 1940 Act,
the 1940 Act Rules and Regulations and the Code; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles, to calculate net
asset value and fee accruals, to maintain accountability for assets and to
maintain compliance with the books and records requirements under the 1940
Act and the 1940 Act Rules and Regulations; (iii) access to assets is
permitted only in accordance with the Board of Trustees' general or
specific authorization; and (iv) the recorded account for assets is
compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(q) The conduct by the Fund of its business (as described in the
Prospectus) does not require it to be the owner, possessor or licensee of
22
any patents, patent licenses, trademarks, service marks or trade names
which it does not own, possess or license.
(r) Except as stated in this Agreement and in the Prospectus (and
any amendment or supplement thereto), the Fund has not taken, directly or
indirectly, any action designed to or which could cause or result in or
which will constitute stabilization or manipulation of the price of the
Shares in violation of federal securities laws and no such action has
been, or will be, taken by any affiliates of the Fund.
(s) The Fund is duly registered under the 1940 Act and the Rules and
Regulations as a closed-end, diversified management investment company and
the 1940 Act Notification has been duly filed with the Commission and, at
the time of filing thereof and at all times through the date hereof the
1940 Act Notification conformed in all material respects with all
applicable provisions of the 1940 Act and the Rules and Regulations; no
order of suspension or revocation of such registration under the 1940 Act
and the Rules and Regulations has been issued or proceedings therefor
initiated or threatened by the Commission. The provisions of the
Declaration, and the investment policies and restrictions described in
each of the Registration Statement and the Prospectus, comply in all
material respects with the requirements of the 1940 Act and the 1940 Act
Rules and Regulations.
(t) All advertising, sales literature or other promotional material
(including "prospecting letters" and "prospectus wrappers" (collectively,
"investor sales material") and "broker kits," "road show slides," "road
show scripts," "broker post-cards" and "broker reference cards"
(collectively, "broker sales material") authorized in writing by or
prepared by the Fund, the Adviser or the Sub-Adviser for use in connection
with the offering and sale of the Shares (investor sales material and
23
broker sales material is collectively referred to as "sales material"))
complied and comply in all material respects with the applicable
requirements of the 1933 Act, the 1933 Act Rules and Regulations and the
rules and interpretations of the NASD and, if required to be filed with
the NASD under the NASD's conduct rules, were so filed and no such sales
material, when read together with the Prospectus, contained or contains an
untrue statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading.
(u) This Agreement and each of the Fund Agreements complies in all
material respects with all applicable provisions of the 1933 Act, the 1940
Act, the Rules and Regulations, 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").
(v) No holder of any security of the Fund has any right to require
registration of any Shares, shares of beneficial interest or any other
security of the Fund because of the filing of the registration statement
or consummation of the transactions contemplated by this Agreement.
(w) In the event that the Fund, the Adviser or the Sub-Adviser makes
available any promotional materials intended for use only by qualified
broker-dealers and registered representatives thereof by means of an
Internet web site or similar electronic means, the Fund, the Adviser or
Sub-Adviser will install and maintain pre-qualification and
password-protection or similar procedures which are reasonably designed to
effectively prohibit access to such promotional materials by persons other
than qualified broker-dealers and registered representatives thereof.
24
(x) The Commission has not issued any order preventing or suspending
the use of any Prepricing Prospectus or the Prospectus.
(y) 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 ▇▇▇▇ ▇▇▇) of the
Fund or an "affiliated person" (as defined in the ▇▇▇▇ ▇▇▇) of any
Underwriter listed in Schedule I hereto.
(z) The Shares have been approved for listing on the AMEX, subject
to official notice of issuance, and the Fund's registration statement on
Form 8-A under the 1934 Act has become effective.
7. Representations and Warranties of the Adviser. The Adviser represents
and warrants to each Underwriter as follows:
(a) The Adviser is a limited partnership duly organized and validly
existing in good standing under the laws of the State of Illinois, with
full power and authority to own, lease and operate its properties and to
conduct its business as described in each of the Registration Statement
and the Prospectus (or any amendment or supplement to either of them) and
is duly registered and qualified to conduct business and is in good
standing in each jurisdiction or place where the nature of its properties
or conduct of its business requires such registration or qualification,
except where the failure so to register or to qualify would not have a
Material Adverse Effect on the Adviser, Sub-Adviser or the Fund.
(b) 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 1940 Act, the Advisers Act Rules and Regulations or the
1940 Act Rules and Regulations from acting under either of the Advisory
25
Agreements for the Fund as contemplated by the Registration Statement or
the Prospectus (or any amendment or supplement to either of them). There
does not exist any proceeding which could have a material adverse effect
on the registration of the Adviser with the Commission.
(c) The Adviser is not in violation of the 1940 Act, the 1940 Act
Rules and Regulations, the Advisers Act or the Advisers Act Rules and
Regulations, any law, ordinance, administrative or governmental rule or
regulation applicable to the Adviser or any decree of the Commission, the
NASD, any national securities exchange, any arbitrator, any court or any
regulatory body, administrative agency or other governmental body, agency
or official having jurisdiction over the Adviser. The Adviser maintains
and will maintain processes, systems and controls sufficient to provide
reasonable assurances that the Adviser complies and will continue to
comply with the 1940 Act, the 1940 Act Rules and Regulations, the Advisers
Act and the Advisers Act Rules and Regulations, any law, ordinance,
administrative or governmental rule or regulation applicable to the
Adviser and any decree of the Commission, the NASD, any national
securities exchange, any arbitrator, any court or any regulatory body,
administrative agency or other governmental body, agency or official
having jurisdiction over the Adviser.
(d) There are no legal or governmental proceedings pending or, to
the knowledge of the Adviser, threatened against the Adviser that are
required to be described in the Registration Statement or the Prospectus
(or any amendment or supplement to either of them) but are not described
as required or that could result in any Material Adverse Change in the
Adviser or that may have a material, adverse effect on the ability of the
Adviser to perform its obligations under this Agreement or either of the
Advisory Agreements.
26
(e) Neither the execution, delivery or performance of this
Agreement, the Subscription Agreement, the Agreement between the Adviser
and the Sub-Adviser dated August 1, 2003, setting forth the basic economic
terms and material conditions and provisions governing their relationship
(the "Advisory Terms Agreement") or either of the Advisory Agreements, nor
the consummation by the Adviser of the transactions contemplated hereby or
thereby (i) requires the Adviser to obtain any consent, approval,
authorization or other order of, or registration or filing with, the
Commission, the NASD, any state securities commission, any national
securities exchange, any arbitrator, any court, regulatory body,
administrative agency or other governmental body, agency or official
having jurisdiction over the Adviser or conflicts or will conflict with or
constitutes or will constitute a breach of or a default under, the limited
partnership agreement or bylaws, or other organizational documents of the
Adviser or (ii) conflicts or will conflict with or constitutes or will
constitute a breach of or a default under, any material agreement,
indenture, lease or other instrument to which the Adviser is a party or by
which the Adviser or any of its properties may be bound, or violates or
will violate any statute, law, regulation or judgment, injunction, order
or decree applicable to the Adviser or any of its properties or will
result in the creation or imposition of any material lien, charge or
encumbrance upon any property or assets of the Adviser pursuant to the
terms of any 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 Adviser is
subject, except in any case under clause (i) or (ii) as should not
reasonably be expected to have a material adverse effect on the ability of
the Adviser to perform its obligations under this Agreement, the
Subscription Agreement or either of the Advisory Agreements. The Adviser
is not subject to any order of any court or of any arbitrator, regulatory
body, administrative agency or other governmental body, agency or
official.
27
(f) The Adviser has full power and authority to enter into this
Agreement, the Subscription Agreement and each of the Advisory Agreements,
the execution and delivery of, and the performance by the Adviser of its
obligations under, this Agreement, the Subscription Agreement and each of
the Advisory Agreements have been duly and validly authorized by the
Adviser and this Agreement, the Subscription Agreement and each of the
Advisory Agreements have been duly executed and delivered by the Adviser
and constitute the valid and legally binding agreements of the Adviser,
enforceable against the Adviser in accordance with their terms, except as
rights to indemnity and contribution hereunder may be limited by federal
or state securities laws and subject to the qualification that the
enforceability of the Adviser's obligations hereunder and thereunder may
be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium and other laws relating to or affecting
creditors' rights generally and by general equitable principles whether
enforcement is considered in a proceeding in equity or at law.
(g) The Adviser has the financial resources necessary for the
performance of its services and obligations as contemplated in the
Registration Statement and the Prospectus (or any amendment or supplement
to either of them) or under this Agreement, the Subscription Agreement or
either of the Advisory Agreements.
(h) The description of the Adviser and its business, and the
statements attributable to the Adviser, in the Registration Statement or
the Prospectus (or any amendment or supplement to either of them) complied
and comply in all material respects with the applicable provisions of the
1933 Act, the 1940 Act, the Advisers Act, the Rules and Regulations and
the Advisers Act 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
(in the case of the Prospectus, in light of the circumstances under which
they were made) not misleading.
28
(i) Since the date as of which information is given in the
Registration Statement or the Prospectus (or any amendment or supplement
to either of them), except as otherwise stated therein, there has not
occurred any event that should reasonably be expected to have a material,
adverse effect on the ability of the Adviser to perform its obligations
under this Agreement or each of the Advisory Agreements.
(j) The Adviser has such licenses, permits and authorizations of
governmental or regulatory authorities ("permits") as are necessary to own
its property and to conduct its business in the manner described in the
Prospectus (and any amendment or supplement thereto), except to the extent
that any failure to have such permits should not reasonably be expected to
have a material, adverse effect on the ability of the Adviser to perform
its obligations under each of the Advisory Agreements.
(k) This Agreement and the Advisory Agreements each do not violate
any applicable provisions of the 1940 Act, the 1940 Act Rules and
Regulations, the Advisers Act and the Advisers Act Rules and Regulations.
(l) Except as stated in this Agreement, the Registration Statement
or the Prospectus (or in any amendment or supplement to any of the
foregoing), the Adviser has not taken any action designed to or which
might reasonably be expected to cause or result in or which will
constitute stabilization or manipulation of the price of the Shares or of
any securities issued by the Fund to facilitate the sale or resale of the
Shares, in each case, in violation of federal securities laws and the
Adviser is not aware of any such action taken or to be taken by any
affiliates of the Adviser.
29
8. Representations and Warranties of the Sub-Adviser. The Sub-Adviser
represents and warrants to each Underwriter as follows:
(a) The Sub-Adviser is a limited liability company duly formed and
validly existing in good standing under the laws of the State of Delaware,
with full limited liability company power and authority to own, lease and
operate its properties and to conduct its business as described in each of
the Registration Statement and the Prospectus (or any amendment or
supplement to either of them) and is duly registered and qualified to
conduct business and is in good standing in each jurisdiction or place
where the nature of its properties or conduct of its business requires
such registration or qualification, except where the failure so to
register or to qualify would not have a material, adverse affect on the
condition (financial or other), general affairs, business, properties, net
assets or results of operations of the Sub-Adviser, the Adviser or the
Fund.
(b) The Sub-Adviser is duly registered with the Commission as an
investment adviser under the Advisers Act and is not prohibited by the
Advisers Act, the 1940 Act, the Advisers Act Rules and Regulations or the
1940 Act Rules and Regulations from acting under the Sub-Advisory
Agreement for the Fund as contemplated by the Registration Statement or
the Prospectus (or any amendment or supplement to either of them). There
does not exist any proceeding which could have a material adverse affect
on the registration of the Sub-Adviser with the Commission.
(c) The Sub-Adviser is not in violation of the 1940 Act, the 1940
Act Rules and Regulations, the Advisers Act or the Advisers Act Rules and
Regulations, any law, ordinance, administrative or governmental rule or
regulation applicable to the Sub-Adviser or any decree of the Commission,
the NASD, any national securities exchange, any arbitrator, any court or
any regulatory body, administrative agency or other governmental body,
30
agency or official having jurisdiction over the Sub-Adviser. The
Sub-Adviser maintains and will maintain processes, systems and controls
sufficient to provide reasonable assurances that the Sub-Adviser complies
and will continue to comply with the 1940 Act, the 1940 Act Rules and
Regulations, the Advisers Act and the Advisers Act Rules and Regulations,
any law, ordinance, administrative or governmental rule or regulation
applicable to the Sub-Adviser and any decree of the Commission, the NASD,
any national securities exchange, any arbitrator, any court or any
regulatory body, administrative agency or other governmental body, agency
or official having jurisdiction over the Sub-Adviser.
(d) There are no legal or governmental proceedings pending or, to
the knowledge of the Sub-Adviser, threatened against the Sub-Adviser that
are required to be described in the Registration Statement or the
Prospectus (or any amendment or supplement to either of them) but are not
described as required or that could result in any material, adverse change
in the condition (financial or other), properties, net assets or results
of operations of the Sub-Adviser or that may have a material, adverse
effect on the ability of the Sub-Adviser to perform its obligations under
this Agreement or the Sub-Advisory Agreement.
(e) Neither the execution, delivery or performance of this
Agreement, the Advisory Terms Agreement or the Sub-Advisory Agreement by
the Sub-Adviser, nor the consummation by the Sub-Adviser of the
transactions contemplated hereby or thereby (i) requires the Sub-Adviser
to obtain any consent, approval, authorization or other order of, or
registration or filing with, the Commission, the NASD, any state
securities commission, any national securities exchange, any arbitrator,
any court, regulatory body, administrative agency or other governmental
body, agency or official having jurisdiction over the Sub-Adviser or
conflicts or will conflict with or constitutes or will constitute a breach
31
of or a default under, the certificate of formation, limited liability
company agreement, or other organizational documents of the Sub-Adviser or
(ii) conflicts or will conflict with or constitutes or will constitute a
breach of or a default under, any agreement, indenture, lease or other
instrument to which the Sub-Adviser is a party or by which the Sub-Adviser
or any of its properties may be bound, or violates or will violate any
statute, law, regulation or judgment, injunction, order or decree
applicable to the Sub-Adviser or any of its properties or will result in
the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Sub-Adviser pursuant to the terms of any
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 Sub-Adviser is subject,
except in any case under clause (i) or (ii) as would not have a material
adverse effect on the ability of the Sub-Adviser to perform its
obligations under this Agreement or the Sub-Advisory Agreement. The
Sub-Adviser is not subject to any order of any court or of any arbitrator,
regulatory body, administrative agency or governmental body, agency or
official.
(f) The Sub-Adviser has full power and authority to enter into this
Agreement and the Sub-Advisory Agreement, the execution and delivery of,
and the performance by the Sub-Adviser of its obligations under, this
Agreement and the Sub-Advisory Agreement have been duly and validly
authorized by the Sub-Adviser and this Agreement and the Sub-Advisory
Agreement have been duly executed and delivered by the Sub-Adviser and
constitute the valid and legally binding agreements of the Sub-Adviser,
enforceable against the Sub-Adviser in accordance with their terms, except
as rights to indemnity and contribution hereunder may be limited by
federal or state securities laws and subject to the qualification that the
enforceability of the Sub-Adviser's obligations hereunder and thereunder
32
may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium and other laws relating to or affecting
creditors' rights generally and by general equitable principles whether
enforcement is considered in a proceeding in equity or at law.
(g) The Sub-Adviser has the financial resources necessary for the
performance of its services and obligations as contemplated in the
Registration Statement and the Prospectus (or any amendment or supplement
to either of them) or under this Agreement or the Sub-Advisory Agreement.
(h) The description of the Sub-Adviser and its business, and the
statements attributable to the Sub-Adviser, in the Registration Statement
or the Prospectus (or 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 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
(in the case of the Prospectus, in light of the circumstances under which
they were made) not misleading.
(i) Since the date as of which information is given in the
Registration Statement or the Prospectus (or any amendment or supplement
to either of them), except as otherwise stated therein, (i) there has been
no material adverse change in the condition (financial or other),
business, properties, net assets or results of operations or business
prospects of the Sub-Adviser, whether or not arising from the ordinary
course of business and (ii) there have been no transactions entered into
by the Sub-Adviser which are material to the Sub-Adviser other than those
in the ordinary course of its business as described in the Prospectus.
33
(j) The Sub-Adviser has such licenses, permits and authorizations of
governmental or regulatory authorities ("permits") as are necessary to own
its property and to conduct its business in the manner described in the
Prospectus (and any amendment or supplement thereto); the Sub-Adviser has
fulfilled and performed all its obligations with respect to such permits
and no event has occurred which allows, or after notice or lapse of time
would allow, revocation or termination thereof or results in any other
impairment of the rights of the Sub-Adviser under any such permit.
(k) This Agreement and the Sub-Advisory Agreement each do not
violate any applicable provisions of the 1940 Act, the 1940 Act Rules and
Regulations, the Advisers Act and the Advisers Act Rules and Regulations.
(l) Except as stated in this Agreement, the Registration Statement
or the Prospectus (or in any amendment or supplement to any of the
foregoing), the Sub-Adviser has not taken and will not take, directly or
indirectly, any action designed to or which might reasonably be expected
to cause or result in or which will constitute stabilization or
manipulation of the price of the Shares or of any securities issued by the
Fund to facilitate the sale or resale of the Shares, in each case, in
violation of federal securities laws and the Sub-Adviser is not aware of
any such action taken or to be taken by any affiliates of the Sub-Adviser.
9. Indemnification and Contribution.
(a) The Fund, the Adviser and the Sub-Adviser, jointly and
severally, agree to indemnify and hold harmless each of you and each other
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,
from and against any and all losses, claims, damages, liabilities and
expenses, joint or several (including reasonable costs of investigation),
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, the
34
Prospectus, any Prepricing Prospectus, any sales material (as defined in
Section 6(t) of this Agreement) (or any amendment or supplement to any of
the foregoing) or arising out of or based upon any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein (in the case of a prospectus, in
light of the circumstances under which they were made) not misleading,
except insofar as such losses, claims, damages, liabilities or expenses
arise out of or are based upon any untrue statement or omission or alleged
untrue statement or omission which has been made therein or omitted
therefrom in reliance upon and in conformity with the information relating
to such Underwriters furnished in writing to the Fund by or on behalf of
any Underwriter through you expressly for use in connection therewith;
provided, however, that the foregoing indemnification contained in this
paragraph (a) with respect to the Prepricing Prospectus contained in
Pre-Effective Amendment No. 3 to the registration statement shall not
inure to the benefit of any Underwriter (or to the benefit of any person
controlling such Underwriter) on account of any such loss, claim, damage,
liability or expense arising from the sale of the Shares by such
Underwriter to any person if it is shown that a copy of the Prospectus
(which term as used in this proviso shall not include any statement of
additional information) was not delivered or sent to such person within
the time required by the 1933 Act and the 1933 Act Rules and Regulations
and the untrue statement or alleged untrue statement or omission or
alleged omission of a material fact contained in such Prepricing
Prospectus was corrected in the Prospectus, provided that the Fund has
delivered the Prospectus to the several Underwriters in requisite quantity
on a timely basis to permit proper delivery or sending. The foregoing
indemnity agreement shall be in addition to any liability which the Fund,
the Adviser or the Sub-Adviser may otherwise have.
35
(b) If any action, suit or proceeding shall be brought against any
Underwriter or any person controlling any Underwriter in respect of which
indemnity may be sought against the Fund, the Adviser or the Sub-Adviser,
such Underwriter or such controlling person shall promptly notify the
Fund, the Adviser or the Sub-Adviser and the Fund, the Adviser or the
Sub-Adviser shall assume the defense thereof, including the employment of
counsel and the payment of all fees and expenses. Such Underwriter or any
such controlling person shall have the right to employ separate counsel in
any such action, suit or proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense
of such Underwriter or controlling person unless (i) the Fund, the Adviser
or the Sub-Adviser have agreed in writing to pay such fees and expenses,
(ii) the Fund, the Adviser or the Sub-Adviser have failed within a
reasonable time to assume the defense and employ counsel or (iii) the
named parties to any such action, suit or proceeding (including any
impleaded parties) include both such Underwriter or such controlling
person and the Fund, the Adviser or the Sub-Adviser and such Underwriter
or such controlling person shall have been advised by its counsel that
representation of such indemnified party and the Fund, the Adviser or the
Sub-Adviser by the same counsel would be inappropriate under applicable
standards of professional conduct (whether or not such representation by
the same counsel has been proposed) due to actual or potential differing
interests between them (in which case the Fund, the Adviser and the
Sub-Adviser shall not have the right to assume the defense of such action,
suit or proceeding on behalf of such Underwriter or such controlling
person). It is understood, however, that the Fund, the Adviser and the
Sub-Adviser shall, in connection with any one such action, suit or
proceeding or separate but substantially similar or related actions, suits
or proceedings in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and
36
expenses of only one separate firm of attorneys (in addition to any local
counsel if there is any action, suit or proceeding in more than one
jurisdiction) at any time for all such Underwriters and controlling
persons not having actual or potential differing interests with you or
among themselves, which firm shall be designated in writing by the
Representative and that, subject to the requirements of 1940 Act Release
No. 11330, all such fees and expenses shall be reimbursed promptly as they
are incurred. The Fund, the Adviser and the Sub-Adviser shall not be
liable for any settlement of any such action, suit or proceeding effected
without the written consent of the Fund, the Adviser or the Sub-Adviser,
but if settled with such written consent or if there be a final judgment
for the plaintiff in any such action, suit or proceeding, the Fund, the
Adviser and the Sub-Adviser agree to indemnify and hold harmless any
Underwriter, to the extent provided in the preceding paragraph and any
such controlling person from and against any loss, liability, damage or
expense by reason of such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Fund, the Adviser and the Sub-Adviser, their
directors, trustees, members, managers or partners, any officers of the
Fund who sign the Registration Statement and any person who controls the
Fund, the Adviser or the Sub-Adviser within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act, to the same extent as the
foregoing indemnity from the Fund, the Adviser and the Sub-Adviser to each
Underwriter, but only with respect to information relating to such
Underwriter furnished in writing by or on behalf of such Underwriter
through you expressly for use in the Registration Statement, the
Prospectus or any Prepricing Prospectus (or any amendment or supplement
thereto). If any action, suit or proceeding shall be brought against the
Fund, the Adviser or the Sub-Adviser, any of their directors, trustees,
37
members, managers or partners, any such officer or any such controlling
person, based on the Registration Statement, the Prospectus or any
Prepricing Prospectus (or any amendment or supplement thereto) and in
respect of which indemnity may be sought against any Underwriter pursuant
to this paragraph (c), such Underwriter shall have the rights and duties
given to each of the Fund, the Adviser and the Sub-Adviser by paragraph
(b) above (except that if the Fund, the Adviser or the Sub-Adviser shall
have assumed the defense thereof such Underwriter shall not be required to
do so, but may employ separate counsel therein and participate in the
defense thereof, but the fees and expenses of such counsel shall be at
such Underwriter's expense) and the Fund, the Adviser and the Sub-Adviser,
their directors, trustees, members, managers or partners, any such officer
and any such controlling person shall have the rights and duties given to
the Underwriters by paragraph (b) above. The foregoing indemnity agreement
shall be in addition to any liability which the Underwriters may otherwise
have.
(d) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred
to therein, then an indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities
or expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the Fund, the Adviser and the Sub-Adviser on
the one hand (treated jointly for this purpose as one person) and the
Underwriters on the other from the offering of the Shares or (ii) if the
allocation provided by clause (i) above 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, the Adviser and the Sub-Adviser on the one hand (treated jointly
38
for this purpose as one person) and of the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Fund, the
Adviser and the Sub-Adviser on the one hand (treated jointly for this
purpose as one person) and the Underwriters on the other shall be deemed
to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Fund bear to the total
underwriting discounts and commissions received by the Underwriters, in
each case, as set forth in the table on the cover page of the Prospectus.
The relative fault of the Fund, the Adviser and the Sub-Adviser on the one
hand (treated jointly for this purpose as one person) and of the
Underwriters on the other shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Fund, the Adviser and the Sub-Adviser on the
one hand (treated jointly for this purpose as one person) or by the
Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission.
(e) The Fund, the Adviser, the Sub-Adviser and the Underwriters
agree that it would not be just and equitable if contribution pursuant to
this Section 9 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 that does not take account of the equitable
considerations referred to in paragraph (d) above. The amount paid or
payable by an indemnified party as a result of the losses, claims,
damages, liabilities and expenses referred to in paragraph (d) above shall
be deemed to include, subject to the limitations set forth above, any
39
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating any claim or defending any such action, suit
or proceeding. Notwithstanding the provisions of this Section 9, no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price of the Shares underwritten by it and
distributed to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of
the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The Underwriters'
obligations to contribute pursuant to this Section 9 are several in
proportion to the respective number of Shares set forth opposite their
names in Schedule I (or such number of Shares increased as set forth in
Section 11 hereof) and not joint.
(f) No indemnifying party shall, without the prior written consent
of the indemnified party, effect any settlement of any pending or
threatened action, suit or proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability from
claimants on claims that are the subject matter of such action, suit or
proceeding.
(g) Any losses, claims, damages, liabilities or expenses for which
an indemnified party is entitled to indemnification or contribution under
this Section 9 shall, subject to the requirements of Release No. 11330, be
paid by the indemnifying party to the indemnified party as such losses,
claims, damages, liabilities or expenses are incurred. The indemnity and
contribution agreements contained in this Section 9 and the
representations and warranties of each of the Fund, the Adviser and the
40
Sub-Adviser set forth in this Agreement shall remain operative and in full
force and effect, regardless of (i) any investigation made by or on behalf
of any Underwriter or any person controlling any Underwriter, the Fund,
the Adviser, the Sub-Adviser or their officers, directors, trustees,
members, managers or partners, or any person controlling the Fund, the
Adviser or the Sub-Adviser, (ii) acceptance of any Shares and payment
therefor hereunder and (iii) any termination of this Agreement. A
successor to any Underwriter or to the Fund, the Adviser or the
Sub-Adviser or their officers, directors, trustees, members, managers or
partners, or any person controlling the Fund, the Adviser or the
Sub-Adviser shall be entitled to the benefits of the indemnity,
contribution and reimbursement agreements contained in this Section 9.
10. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase the Shares hereunder are subject to the accuracy of
and compliance with the representations, warranties and agreements of and by
each of the Fund, the Adviser and the Sub-Adviser contained herein on and as of
the date on which the Registration Statement becomes or became effective, the
date of the Prospectus (and of any amendment or supplement thereto) and the
Closing Date and, with respect to any Additional Shares, any Option Closing
Date; to the accuracy and completeness of all statements made by the Fund, the
Adviser, the Sub-Adviser or any of their respective officers in any certificate
delivered to the Representative or its counsel pursuant to this Agreement, and
to the following conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment
thereto to be declared effective before the offering of the Shares may
commence, the Registration Statement or such post-effective amendment
shall have become effective not later than 5:30 p.m., New York time, on
the date hereof or at such later date and time as shall be consented to in
41
writing by you, and all filings, if any, required to be made by the Fund
pursuant to Rules 497 and 430A under the 1933 Act and the 1933 Act Rules
and Regulations shall have been timely made; no stop order suspending the
effectiveness of the Registration Statement or order pursuant to Section
8(e) of the 1940 Act shall have been issued and no proceeding for that
purpose shall have been instituted or, to the knowledge of the Fund, the
Adviser, the Sub-Adviser or any Underwriter, threatened by the Commission,
and any request of the Commission for additional information (to be
included in the Registration Statement or the Prospectus or otherwise)
shall have been complied with to your satisfaction.
(b) Subsequent to the effective date of this Agreement, there shall
not have occurred (i) any Material Adverse Change, whether or not
occurring in the ordinary course of business, in the Fund, the Adviser or
the Sub-Adviser not contemplated by the Prospectus (or any amendment or
supplement thereto), which in your opinion, would materially adversely
affect the market for the Shares, or (ii) any event or development
relating to or involving the Fund, the Adviser or the Sub-Adviser or any
officer, director, trustee, member, partner or manager of the Fund, the
Adviser or the Sub-Adviser which makes any statement made in the
Prospectus (or any amendment or supplement thereto) untrue or which, in
the opinion of the Fund and its counsel or the Underwriters and their
counsel, requires the making of any addition to or change in the
Prospectus (or any amendment or supplement thereto) in order to state a
material fact required by the 1933 Act, the 1940 Act or the Rules and
Regulations or any other law to be stated therein or necessary in order to
make the statements therein, in light of the circumstances in which they
are made, not misleading, if amending or supplementing the Prospectus (or
any previous amendment or supplement thereto) to reflect such event or
development would, in your opinion, materially adversely affect the market
for the Shares.
42
(c) You shall have received on the Closing Date an opinion of
▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ LLP, counsel for the Fund, dated the Closing Date and
addressed to you, as the Representative of the several Underwriters, in
substantially the form attached hereto as Exhibit A. In rendering its
opinion, ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ LLP may rely, as to matters of Massachusetts
law, upon the opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP dated as of the date
thereof.
(d) You shall have received on the Closing Date an opinion of
▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ LLP, counsel for the Adviser, dated the Closing Date
and addressed to you, as Representative of the several Underwriters, in
substantially the form attached hereto as Exhibit B.
(e) You shall have received on the Closing Date an Opinion of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel for the Sub-Adviser, dated the
Closing Date and addressed to you, as the Representative of the several
underwriter, in substantially the form attached hereto as Exhibit C.
(f) You shall have received on the Closing Date an opinion as to
Massachusetts law of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP, special counsel for the Fund,
dated the Closing Date and addressed to you, as the Representative of the
several Underwriters, in substantially the form attached hereto as Exhibit
D.
(g) You shall have received on the Closing Date an opinion of
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, dated the Closing Date and
addressed to you, as the Representative of the several underwriters, with
respect to such matters as you may require and the Fund, the Adviser, the
Sub-Adviser and their respective counsel shall have furnished to such
counsel such documents as they may request for the purpose of enabling
them to pass upon such matters.
43
(h) You shall have received letters addressed to you, as the
Representative of the several Underwriters and dated each of the date
hereof and the Closing Date from Deloitte & Touche LLP, independent
certified public accountants, substantially in the forms heretofore
approved by you.
(i) (i) No order suspending the effectiveness of the Registration
Statement or prohibiting or suspending the use of the Prospectus (or any
amendment or supplement to any of the foregoing) or any Prepricing
Prospectus or any sales material shall have been issued and no proceedings
for such purpose or for the purpose of commencing an enforcement action
against the Fund, the Adviser or the Sub-Adviser or, with respect to the
transactions contemplated by the Prospectus (or any amendment or
supplement thereto) and this Agreement, may be pending before or, to the
knowledge of the Fund, the Adviser, the Sub-Adviser or any Underwriter or
in the reasonable view of counsel to the Underwriters, shall be threatened
or contemplated by the Commission at or prior to the Closing Date and that
any request for additional information on the part of the Commission (to
be included in the Registration Statement, the Prospectus or otherwise) be
complied with to the satisfaction of the Representative, (ii) there shall
not have been any change in the shares of beneficial interest of the Fund
or its capitalization nor any incurrence of debt by the Fund from that set
forth in the Registration Statement or the Prospectus (or any amendment or
supplement to either of them) and the Fund shall not have sustained any
material liabilities or obligations, direct or contingent, other than
those reflected in or contemplated by the Registration Statement or the
Prospectus (or any amendment or supplement to either of them), (iii) since
the date of the Prospectus there shall not have been any Material Adverse
Change in the Fund, the Adviser or the Sub-Adviser, (iv) none of the Fund,
the Adviser or the Sub-Adviser shall have sustained any material loss or
interference with their businesses from any court or from legislative or
44
other governmental action, order or decree or from any other occurrence
not described in the Registration Statement or the Prospectus (or any
amendment or supplement to either of them), and (v) all of the
representations and warranties of each of the Fund, the Adviser or the
Sub-Adviser contained in this Agreement shall be true and correct on and
as of the date hereof and as of the Closing Date as if made on and as of
the Closing Date.
(j) None of the Fund, the Adviser, or the Sub-Adviser shall have
failed at performing or complying with, or prior to the Closing Date to
have performed or complied with, any of the agreements herein contained
and required to be performed or complied with by them at or prior to the
Closing Date.
(k) You shall have received on the Closing Date a certificate, dated
such date, of each of the chief executive officer and chief financial
officer of each of the Fund, the Adviser and the Sub-Adviser certifying
that (i) the signers have carefully examined the Registration Statement,
the Prospectus (and any amendments or supplements to either of them) and
this Agreement, (ii) the representations and warranties of the Fund (with
respect to the certificates from such Fund officers), the representations
and warranties of the Adviser (with respect to the certificates from such
officers of the Adviser), and the representations and warranties of the
Sub-Adviser (with respect to the certificates from such officers of the
Sub-Adviser) in this Agreement are true and correct on and as of the date
of the certificate as if made on such date, (iii) since the date of the
Prospectus (and any amendment or supplement thereto) there has not been
any material, adverse change in the condition (financial or other),
business, prospects, properties, net assets or results of operations of
the Fund (with respect to the certificates from such Fund officers) or the
Adviser (with respect to the certificates from such officers of the
Adviser) or the Sub-Adviser (with respect to the certificates from such
officers of the Sub-Adviser), (iv) to the knowledge of such officers after
reasonable investigation, no order suspending the effectiveness of the
Registration Statement or prohibiting the sale of any of the Shares or
having a material, adverse effect on the Fund (with respect to the
certificates from such Fund officers) or the Adviser (with respect to the
45
certificates from such officers of the Adviser) or the Sub-Adviser (with
respect to the certificates from such officers of the Sub-Adviser) has
been issued and no proceedings for any such purpose are pending before or
threatened by the Commission or any court or other regulatory body, the
NASD, any state securities commission, any national securities exchange,
any arbitrator, any court or any other governmental, regulatory,
self-regulatory or administrative agency or any official, (v) each of the
Fund (with respect to certificates from such Fund officers), the Adviser
(with respect to certificates from such officers of the Adviser) and the
Sub-Adviser (with respect to the certificates from such officers of the
Sub-Adviser) has performed and complied with all agreements that this
Agreement require it to perform by such Closing Date, (vi) none of the
Fund (with respect to the certificate from such officers of the Fund), the
Adviser (with respect to the certificate from such officers of the
Adviser) or the Sub-Adviser (with respect to the certificates from such
officers of the Sub-Adviser) has sustained any material loss or
interference with its business from any court or from legislative or other
governmental action, order or decree or from any other occurrence not
described in the Registration Statement or the Prospectus and any
amendment or supplement to either of them and (vii) with respect to the
certificate from such officers of the Fund, there has not been any change
in the shares of beneficial interest of the Fund or its capitalization or
any incurrence of debt by the Fund from that set forth in the Prospectus
(or any amendment or supplement thereto) and the Fund has not sustained
any material liabilities or obligations, direct or contingent, other than
those reflected in the Prospectus (or any amendment or supplement
thereto).
46
(l) That the Fund, the Adviser and the Sub-Adviser shall have
furnished to you such further letters, certificates, documents and
opinions of counsel as you shall reasonably request (including
certificates of officers of the Fund, the Adviser and the Sub-Adviser).
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are sufficiently satisfactory
in form and substance to you and your counsel acting in good faith.
Any certificate or document signed by any officer of the Fund, the Adviser
or the Sub-Adviser and delivered to you, as the Representative of the
Underwriters or to Underwriters' counsel, shall be deemed a representation and
warranty by the Fund, the Adviser or the Sub-Adviser to each Underwriter as to
the statements made therein.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to (i) the accuracy of and compliance with the
representations and warranties of the Fund, the Adviser and the Sub-Adviser
contained herein on and as of the Option Closing Date as though made on any
Option Closing Date, (ii) satisfaction on and as of any Option Closing Date of
the conditions set forth in this Section 10 except that, if any Option Closing
Date is other than the Closing Date, the certificates, opinions and letters
referred to in ▇▇▇▇▇▇▇▇ ▇▇ (▇), (▇), (▇), (▇), (▇), (▇) and (m) and this
paragraph shall be dated the Option Closing Date in question and the opinions
called for by Sections 10 (c), (d), (e), (f), (h), (l) and (m) shall be revised
to reflect the sale of Additional Shares and (iii) the absence of circumstances
on or prior to the Option Closing Date which would permit termination of this
Agreement pursuant to Section 12 hereof if they existed on or prior to the
Closing Date.
47
11. Effective Date of Agreement. This Agreement shall become effective:
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for the
Registration Statement or a post-effective amendment thereto to be declared
effective before the offering of the Shares may commence, when the Registration
Statement or such post-effective amendment has become effective. Until such time
as this Agreement shall have become effective, it may be terminated by the Fund
by notifying you, or by you by notifying the Fund.
If any one or more of the Underwriters shall fail or refuse to purchase
Shares which it or they have agreed to purchase hereunder and the aggregate
number of Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares, each non-defaulting Underwriter shall be obligated, severally, in
the proportion which the aggregate number of Shares set forth opposite its name
in Schedule I hereby bears to the aggregate number of Shares set forth opposite
the names of all non-defaulting Underwriters or in such other proportion as you
may specify in accordance with Section 7 of the ▇▇▇▇▇▇▇ ▇▇▇▇▇ Master Agreement
Among Underwriters, to purchase Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase. If any Underwriter or
Underwriters shall fail or refuse to purchase Shares and the aggregate number of
Shares with respect to which such default occurs is more than one-tenth of the
aggregate number of Shares and arrangements satisfactory to you and the Fund for
the purchase of such Shares by one or more non-defaulting Underwriters or other
party or parties approved by you and the Fund are not made within 36 hours after
such default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Fund. In any such case which does not result
in termination of this Agreement, either you or the Fund shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and the
48
Prospectus or any other documents or arrangements may be effected. Any action
taken under this paragraph shall not relieve any defaulting Underwriter from
liability in respect to any such default of any such Underwriter under this
Agreement. The term "Underwriter" as used in this Agreement includes, for all
purposes of this Agreement, any party not listed in Schedule I hereto who, with
your approval and the approval of the Fund, purchases Shares which a defaulting
Underwriter agreed, but failed or refused, to purchase.
Any notice under this Section 11 may be made by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
12. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Fund, the Adviser or the Sub-Adviser by notice to the Fund or
the Adviser if prior to the Closing Date or any Option Closing Date (if
different from the Closing Date and then only as to the Additional Shares), as
the case may be, (i) trading in securities generally on the New York Stock
Exchange, AMEX or the Nasdaq Stock Market shall have been suspended or limited
or minimum prices shall have been established (ii) additional governmental
restrictions not in force on the date of this Agreement have been imposed upon
trading in securities generally or a general moratorium on commercial banking
activities shall have been declared by Federal or any state's authorities or
(iii) any outbreak or material escalation of hostilities or other international
or domestic calamity, crisis or change in political, financial, economic, legal
or regulatory conditions, occurs, the effect of which is such as to make it, in
your judgment, impracticable or inadvisable to commence or continue the offering
of the Shares at the offering price to the public set forth on the cover page of
the Prospectus or to enforce contracts for the resale of the Shares by the
Underwriters. Notice of such termination may be given to either of the Fund or
the Adviser and the Sub-Adviser by telegram, telecopy or telephone but shall be
subsequently confirmed by letter.
49
13. Expenses. The Fund agrees to pay the following costs and expenses and
all other costs and expenses incident to the performance by the Fund of its
obligations hereunder: (a) the preparation, printing or reproduction, filing
(including, without limitation, the filing or registration fees prescribed by
the 1933 Act, the 1934 Act, the 1940 Act and the Rules and Regulations) and
distribution of the Registration Statement (including exhibits thereto), the
Prospectus, each Prepricing Prospectus and the 1940 Act Notification and all
amendments or supplements to any of them, (b) the printing (or reproduction) and
delivery (including postage, air freight charges and charges for counting and
packaging) of such copies of the Registration Statement, the Prospectus, each
Prepricing Prospectus, any sales material (and all amendments or supplements to
any of them) as may be reasonably requested for use in connection with the
offering and sale of the Shares, (c) the preparation, printing, authentication,
issuance and delivery of certificates (if any) for the Shares, including any
stamp taxes and transfer agent and registrar fees payable in connection with the
original issuance and sale of such Shares, (d) the registrations or
qualifications of the Shares for offer and sale under the securities or Blue Sky
laws of the several states as provided in Section 5(g) hereof (including the
reasonable fees, expenses and disbursements of counsel for the Underwriters
relating to the preparation, printing or reproduction and delivery of the
preliminary and supplemental Blue Sky Memoranda and such registration and
qualification), (e) the fees and expenses of the Fund's independent accountants,
counsel for the Fund and of the transfer agent, (f) the expenses of delivery to
the Underwriters and dealers (including postage, air freight and the cost of
counting and packaging) of copies of the Prospectus, the Prepricing Prospectus,
any sales material and all amendments or supplements to the Prospectus as may be
requested for use in connection with the offering and sale of the Shares, (g)
the printing (or reproduction) and delivery of this Agreement, any dealer
agreements, the preliminary and supplemental Blue Sky Memoranda and all other
company-authorized agreements or other documents printed (or reproduced) and
50
delivered in connection with the offering of the Shares, (h) the filing fees and
the fees and expenses of counsel for the Underwriters in connection with any
filings required to be made with the NASD and incurred with respect to the
review of the offering of the Shares by the NASD, which fees and expenses of
counsel, together with the fees, expenses and disbursements of counsel set forth
in paragraph (d) of this Section 13 above, shall not exceed $25,000, exclusive
of NASD and state filing fees, (i) the transportation, lodging, graphics and
other expenses related to the Fund's preparation for and participation in the
roadshow, (j) the listing of the Shares on the AMEX and (k) an amount not to
exceed $75,000 payable on the Closing Date to the Representative in partial
reimbursement of their expenses (but not including reimbursement for the cost of
one tombstone advertisement in a daily newspaper of national circulation that is
one-quarter of a newspaper page or less in size) in connection with the
offering.
Notwithstanding the foregoing, in the event that the sale of the Shares is
not consummated pursuant to Section 2 hereof, the Adviser or the Sub-Adviser
will pay the costs and expenses of the Fund set forth above in this Section
13(a) through (i), and reimbursements of Underwriter expenses in connection with
the offering shall be made in accordance with Section 5(l) hereof.
14. Information Furnished by the Underwriters. The public offering price
of the Shares as set forth on the cover page of the Prospectus and, as set forth
under the caption "Underwriting" in the Prospectus, (i) the names of the
Underwriters, (ii) the number of Firm Shares set forth opposite the name of each
Underwriter, (iii) the statements set forth in the first and last sentences of
the fourth paragraph, (iv) the statements set forth in the eleventh paragraph
and (iv) the statements set forth in the twelfth paragraph constitute the only
information relating to any Underwriter furnished to the Fund in writing by or
on behalf of the Underwriters through you as such information is referred to
herein, expressly for use in the Prospectus.
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15. Miscellaneous. Except as otherwise provided in Sections 5, 11 and 12
hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (a) if to the Fund or the Adviser, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: W. ▇▇▇▇▇ ▇▇▇▇▇▇▇,
(b) if to the Sub-Adviser, ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, with a copy to ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and (c) if to you, as
Representative of the Underwriters, at the office of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates,
Inc. at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇
▇▇▇▇▇, with a copy to Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
This Agreement has been and is made solely for the benefit of the several
Underwriters, the Fund, the Adviser, the Sub-Adviser, their officers, directors,
trustees, members, managers, partners, and the other controlling persons
referred to in Section 9 hereof and their respective successors and assigns, to
the extent provided herein and no other person shall acquire or have any right
under or by virtue of this Agreement. Neither the term "successor" or the term
"successors and assigns" as used in this Agreement shall include a purchaser
from any Underwriter of any of the Shares in his status as such purchaser.
16. Applicable Law; Counterparts. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
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This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
17. Disclaimer of Liability of Trustees and Beneficiaries. A copy of the
Declaration is on file with the Secretary of The Commonwealth of Massachusetts,
and notice hereby is given that this Agreement is executed by the Trustees or
officers on behalf of the Trustees under the Declaration and not individually
and that the obligations arising under this Agreement are not binding upon any
of the Trustees, officers or shareholders individually, but bind only the assets
and properties of the Fund.
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Please confirm that the foregoing correctly sets forth the agreement as of
the date set forth above among the Fund, the Adviser, the Sub-Adviser and the
several Underwriters.
Very truly yours,
FIRST TRUST/FOUR CORNERS SENIOR
FLOATING RATE INCOME FUND
By:_____________________________
Title:
FIRST TRUST ADVISORS L.P.
By:_____________________________
Title:
FOUR CORNERS CAPITAL MANAGEMENT, LLC
By:_____________________________
Title:
54
Confirmed as of the date
first above written on
behalf of themselves and
the other several Under-
writers named in Schedule
I hereto.
AS REPRESENTATIVE OF THE SEVERAL UNDERWRITERS
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ASSOCIATES, INC.
By: _________________________________
Title: Director
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SCHEDULE I
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