The CINTRA Select Fund, Inc.
_____________ SHARES
COMMON STOCK
($ 0.001 PAR VALUE)
UNDERWRITING AGREEMENT
October ___, 2003
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc.
As Representative of the Several Underwriters
Named in Schedule I
c/o ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
The CINTRA Select Fund, Inc., a Maryland corporation (the "Company"), with
the agreement of the Company's investment adviser, CINTRA Fund Management, LLC,
a Delaware limited liability company (the "Investment Adviser"or "Adviser"),
proposes to sell to the several underwriters named in Schedule I (collectively,
the "Underwriters") an aggregate of [__________] shares (the "Firm Shares") of
the Company's common stock, $0.001 par value per share (the "Common Stock"). The
Firm Shares are to be sold to each Underwriter, acting severally and not
jointly, in such amounts as are set forth in Schedule I opposite the name of
such Underwriter.
Solely for the purpose of covering over-allotments in the sale of the Firm
Shares, the Company grants to the Underwriters the right to purchase up to an
additional [______] shares of Common Stock (the "Option Shares"), which option
shall be exercisable in the manner, and such Option Shares shall be sold in the
denominations, set forth in Section 3(b) below. The Firm Shares and Option
Shares are herein sometimes referred to as the "Shares."
Section 1. Representations and Warranties Relating to the Company
The Company and the Investment Adviser jointly and severally represent and
warrant to, and agree with, each of the Underwriters that:
(a) The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form N-2 (File Nos.
333-96821 and 811-21165), including a preliminary form of prospectus subject to
completion and a statement of additional information, with respect to the Shares
in conformity with the requirements of the Securities Act of 1933, as amended
(the "1933 Act"), and the Investment Company Act of 1940, as amended (the "1940
Act"), and the rules and regulations of the Commission under the 1933 Act and
the 1940 Act (all such rules and regulations, including Regulation S-X to the
extent applicable, referred to hereinafter as the "Rules and Regulations"), and
a notification on Form N-8A of registration of the Company as an investment
company under the 1940 Act. Such amendments to such registration statement as
may have been required, if any, prior to the date hereof have been filed with
the Commission, and such amendments have been prepared in conformity with the
1933 Act, the 1940 Act and the Rules and Regulations. Copies of such
registration statement and amendment or amendments and of each related
preliminary prospectus, and the exhibits, financial statements and schedules, as
finally amended and revised, have been delivered to you. The Company has
prepared in the same manner, and proposes so to file with the Commission, one of
the following: (i) prior to effectiveness of such registration statement, a
further amendment thereto, including the form of final prospectus, or (ii) a
final prospectus in accordance with Rules 430A and 424(b) and paragraph (c) or
(h) of Rule 497 of the Rules and Regulations. The Company also may file a
related registration statement with the Commission pursuant to Rule 462(b) of
the Rules and Regulations for the purpose of registering certain additional
shares of Common Stock, which registration statement will be effective upon
filing with the Commission. As filed, such amendment, any registration statement
filed pursuant to Rule 462(b) of the Rules and Regulations and the final
prospectus shall include all Rule 430A Information (as hereinafter defined) and,
except to the extent that you shall agree in writing to a modification, shall be
in all respects in the form furnished to you prior to the date and time that
this Agreement was executed and delivered by the parties hereto, or, to the
extent not completed at such date and time, shall contain only such specific
additional information and other changes (beyond that contained in the latest
preliminary prospectus) as the Company shall have previously advised you in
writing would be included or made therein.
The term "Registration Statement" as used in this Agreement shall mean such
registration statement at the time such registration statement becomes effective
and, in the event any post-effective amendment thereto becomes effective prior
to the Closing Time (as hereinafter defined), shall also mean such registration
statement as so amended; provided, however, that such term shall also include
all Rule 430A Information contained in any Prospectus (as hereinafter defined)
and deemed to be included in such registration statement at the time such
registration statement becomes effective as provided by Rule 430A of the Rules
and Regulations. The term "Preliminary Prospectus" shall mean any preliminary
prospectus referred to in the preceding paragraph and any preliminary prospectus
included in the Registration Statement at the time it becomes effective that
omits Rule 430A Information. The term "Prospectus" as used in this Agreement
shall mean the prospectus relating to the Shares in the form in which it is
first filed with the Commission pursuant to Rule 424(b) of the Rules and
Regulations or, if no filing pursuant to Rule 424(b) of the Rules and
Regulations is required, shall mean the form of final prospectus included in the
Registration Statement at the time such Registration Statement becomes
effective. The term "Rule 430A Information" means information with respect to
the Shares and the offering thereof permitted pursuant to Rule 430A of the Rules
and Regulations to be omitted from the Registration Statement when it becomes
effective. The term "462(b) Registration Statement" means any registration
statement filed with the Commission pursuant to Rule 462(b) of the Rules and
Regulations (including the Registration Statement and any Preliminary Prospectus
or Prospectus incorporated therein at the time such registration statement
becomes effective). For purposes of this Agreement, all references to the
Registration Statement, any Preliminary Prospectus, the Prospectus or any 462(b)
Registration Statement or any amendment or supplement to any of the foregoing
shall be deemed to include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval system.
(b) No order preventing or suspending the use of any Preliminary Prospectus
has been issued by the Commission and no proceedings for that purpose have been
instituted or, to the knowledge of the Company, threatened by the Commission or
the state securities authority of any jurisdiction, and each Preliminary
Prospectus, at the time of filing thereof conformed in all respects to the
requirements of the 1933 Act, the 1940 Act, and the Rules and Regulations and
did not contain any 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 light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company by an Underwriter expressly
for use in the Registration Statement or any 462(b) Registration Statement.
(c) When the Registration Statement and any 462(b) Registration Statement
shall become effective, when the Prospectus is first filed pursuant to Rule
424(b) of the Rules and Regulations, when any amendment to the Registration
Statement or any 462(b) Registration Statement becomes effective, when any
supplement to the Prospectus is filed with the Commission, and at each Closing
Date (as hereinafter defined in Section 3), (i) the Registration Statement, the
462(b) Registration Statement, the Prospectus and all amendments thereof and
supplements thereto will conform in all respects with the requirements of the
1933 Act, the 1940 Act and the Rules and Regulations and (ii) neither the
Registration Statement, the 462(b) Registration Statement, the Prospectus nor
any amendment or supplement thereto, will contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
in which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to any statement or omission made in
reliance upon and in conformity with information furnished in writing to the
Company by an Underwriter expressly for use in the Registration Statement or any
462(b) Registration Statement.
(d) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its state of incorporation, with
all requisite corporate power and authority to own, lease and license its
properties, and conduct its business as currently conducted and as proposed in
the Prospectus to be conducted. The Company has qualified to do business and is
in good standing as a foreign corporation in every jurisdiction in which the
ownership or leasing of its properties or the nature or conduct of its business,
as currently conducted and as currently proposed to be conducted, requires such
qualification, except where the failure to do so would not have a material
adverse effect on the financial condition, results of operations, cash flows or
prospects of the Company (a "Material Adverse Effect").
(e) The Company has the full legal right, power and authority to enter into
this Agreement and to consummate the transactions contemplated herein. The
Company has the full corporate power and authority to issue, sell and deliver
the Shares as provided herein. This Agreement has been duly authorized, executed
and delivered by the Company and constitutes the valid and binding agreement of
the Company enforceable against the Company in accordance with its terms, except
to the extent that the indemnification provisions set forth in Section 8 of this
Agreement may be limited by applicable law or equitable principles, and except
as enforceability may be limited by bankruptcy, reorganization, moratorium or
similar laws affecting the enforceability of creditors' rights generally and
rules of law governing specific performance, injunctive relief and other
equitable remedies.
(f) The Company is duly registered with the Commission under the 1940 Act
as a non-diversified, closed-end management investment company and no order of
suspension or revocation of such registration has been issued and, to the
knowledge of the Company and the Investment Adviser, no proceedings for that
purpose have been instituted or threatened by the Commission.
(g) To the knowledge of the Company and the Investment Adviser, no person
is serving or acting as an officer, trustee or investment advisor of the Company
except in accordance with the provisions of the 1940 Act and the Rules and
Regulations and the Investment Advisers Act of 1940, as amended (the "Advisers
Act"), and the rules and regulations of the Commission promulgated under the
Advisers Act (the "Advisers Act Rules and Regulations"). Except as disclosed in
the Registration Statement and the Prospectus, to the knowledge of the Company
and the Investment Adviser, no trustee of the Company is an "interested person"
(as defined in the ▇▇▇▇ ▇▇▇) of the Company or an "affiliated person" (as
defined in the ▇▇▇▇ ▇▇▇) of any Underwriter listed in Schedule I hereto.
(h) Each consent, approval, authorization, order, designation or filing by
or with any governmental agency or body necessary for the valid authorization,
issuance, sale and delivery of the Shares, the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby, has been made or obtained by the Company and is in full
force and effect, except as may be required under applicable state securities
laws. The issuance, sale and delivery of the Shares, the execution, delivery and
performance of this Agreement, and the consummation of the transactions
contemplated by this Agreement, (i) will not result in a breach or violation of
any of the terms and provisions of, or constitute a default by the Company
under, its Certificate of Incorporation or Bylaws, (ii) will not result in a
breach or violation of any of the terms or provisions of, or constitute a
default by the Company, under, any provision of any indenture, mortgage, deed of
trust, loan agreement, note, lease or other agreement or instrument to which the
Company is a party or to which it or its properties is subject, and (iii) will
not result in a breach or violation of any statute, judgment, decree, order,
rule or regulation of any court or governmental agency or body applicable to the
Company or any of its properties.
(i) The authorized, issued and outstanding capital stock of the Company is
as set forth in the Prospectus under the caption "Description of Capital Stock."
All of the issued and outstanding shares of Common Stock of the Company have
been duly authorized and validly issued, are fully paid and non-assessable. The
Common Stock of the Company conforms to the description of the Common Stock
contained in the Registration Statement and the Prospectus. All offers and sales
of the Company's capital stock prior to the date hereof were at all relevant
times duly registered under the 1933 Act and the 1940 Act or were exempt from
the registration requirements of the 1933 Act and the 1940 Act and were duly
registered or the subject of an available exemption from the registration
requirements of the applicable state securities or blue sky laws. The Shares,
when issued and delivered by the Company and paid for pursuant to this
Agreement, will be validly issued, fully paid and non-assessable and will
conform in all respects to the description thereof contained in the Prospectus.
No preemptive rights of shareholders exist with respect to any of the Shares,
and no person or entity has a right of participation or first refusal with
respect to the sale of the Shares by the Company. No person or entity holds a
right to require or participate in the registration under the 1933 Act of the
Shares, and no person holds a right to require registration under the 1933 Act
of any shares of Common Stock of the Company at any other time. None of the
issued shares of capital stock of the Company has been issued in violation of
any preemptive or similar rights. There are no outstanding options, warrants or
other rights providing for the issuance of any share of capital stock of the
Company or any security convertible into or exchangeable for capital stock of
the Company. There is no commitment, plan or arrangement to issue any share of
capital stock of the Company or any security convertible into or exchangeable
for capital stock of the Company, except as is disclosed in the Prospectus. The
Company does not own, directly or indirectly, any capital stock or other equity
securities of any other corporation or any ownership interest in any
partnership, limited liability company, joint venture, association or other
entity.
(j) The statement of assets and liabilities and the statement of operations
included in the Registration Statement and the Prospectus, together with the
related notes, present fairly the financial position of the Company at the date
indicated and the results of its operations for the period specified, all in
conformity with generally accepted accounting principles ("GAAP") and in
conformity with Regulation S-X under the Rules and Regulations. No other
financial statements or schedules are required by Form N-2, Regulation S-X or
otherwise to be included in the Registration Statement, any 462(b) Registration
Statement, the Preliminary Prospectus and the Prospectus.
(k) Ernst & Young LLP, which has examined and is reporting upon the audited
financial statements and schedules included in the Registration Statement and
the Prospectus, are, and were during the periods covered by their report
included in the Registration Statement and the Prospectus, independent public
accountants with respect to the Company within the meaning of the 1933 Act and
the Rules and Regulations.
(l) The information set forth in the Prospectus under the caption "Fees and
Expenses" has been prepared in accordance with the requirements of Form N-2 and
to the extent estimated or projected, such estimates or projections are
reasonably believed to be attainable and reasonably based.
(m) The Company has obtained, for the benefit of the Underwriters, from
each of the Company's directors, officers and shareholders as of the date of
this Agreement, a written agreement that for a period of 180 days from the date
of the Prospectus such director, officer or shareholder will not, without your
prior written consent, offer, sell, contract to sell, pledge, grant any option
to purchase, or otherwise dispose of, directly or indirectly, any shares of
Common Stock or other instrument which by its terms is convertible into, or
exercisable or exchangeable for, any shares of Common Stock.
(n) The Company is not in violation of its Certificate of Incorporation or
Bylaws and, as of the date hereof, no default exists, and no event has occurred,
nor state of facts exists, which, with notice or after the lapse of time to cure
or both, would constitute a default in the due performance and observance of any
obligation, agreement, covenant, consideration or condition contained in any
indenture, mortgage, deed of trust, loan agreement, note, lease or other
agreement or instrument to which the Company is a party or by which it or any of
its properties is subject, and no violation of any law, order, rule, regulation,
writ, injunction or decree of any government, governmental instrumentality or
court, domestic or foreign, has occurred or exists, in any such case where the
consequences of such violation or default would have a Material Adverse Effect.
(o) Except as described in the Prospectus, there is not pending, nor to the
Company's or the Investment Adviser's knowledge threatened, any action, suit,
proceeding, inquiry or investigation, against the Company or any of its
officers, directors or shareholders or to which the properties, assets or rights
of the Company are subject, before or brought by any court or governmental
agency or body or board of arbitrators, which would, if determined adversely to
the Company, have a Material Adverse Effect, or which could prevent consummation
of the transactions contemplated by this Agreement.
(p) There are no contracts or other documents required by the 1933 Act, the
1940 Act or the Rules and Regulations to be described in or incorporated by
reference into the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement which have not been accurately described
in all material respects in the Prospectus or incorporated or filed as required.
The agreements to which either the Company or the Investment Adviser is a party
that are described in the Registration Statement and the Prospectus are valid
and enforceable in all material respects by the Company and, to the best of the
Company's and the Investment Adviser's knowledge, no party thereto is in breach
or default under any of such agreements.
(q) The Company owns, possesses or has obtained all permits, licenses,
franchises, certificates, consents, orders, approvals and other authorizations
of governmental or regulatory authorities and other third parties as are
necessary to own or lease, as the case may be, and to operate its properties and
to conduct its businesses as presently conducted and as proposed in the
Prospectus to be conducted, except where a failure to own, possess or obtain
such permits, licenses, franchises, certificates, consents, orders, approvals
and other authorizations would not have a Material Adverse Effect. The Company
has not received any notice relating to termination, revocation or modification
of any such license, permit, franchise, certificate, consent, order, approval or
authorization, which termination, revocation or modification would have a
Material Adverse Effect.
(r) The Company owns or possesses all intangible property rights and
know-how for the conduct of its business as currently conducted and as proposed
in the Prospectus to be conducted (collectively, the "Intellectual Property"),
except where a failure to own or possess would not have a Material Adverse
Effect. Except as described in the Prospectus, (i) no third parties have
received rights to any such Intellectual Property from the Company; (ii) to the
Company's knowledge, there is no infringement by third parties of any such
Intellectual Property; (iii) there is no pending or, to the Company's knowledge,
threatened action, suit, proceeding or claim by others challenging the Company's
rights in or to any such Intellectual Property, and the Company is unaware of
any facts that would form a basis for any such claim; (iv) there is no pending
or, to the Company's knowledge, threatened action, suit, proceeding or claim by
others challenging the validity or scope of any such Intellectual Property, and
the Company is unaware of any facts that would form a basis for any such claim;
(v) there is no pending or, to the Company's knowledge, threatened action, suit,
proceeding or claim by others that the Company infringes or otherwise violates,
or would infringe or otherwise violate upon initiation of its business, any
patent, trademark, copyright, trade secret or other proprietary rights of
others, and the Company is unaware of any facts that would form a basis for any
such claim; and (vi) to the Company's knowledge, there is no patent or patent
application that contains claims that dominate or may dominate any Intellectual
Property described in the Prospectus as being owned by or licensed to the
Company or that is necessary for the conduct of its businesses as currently or
contemplated to be conducted or that interferes with the issued or pending
claims of any such Intellectual Property. None of the technology employed by the
Company has been obtained or, to the Company's knowledge, is being used by the
Company in violation of the rights of any person or third party. The Company
knows of no infringement by others of Intellectual Property owned by or licensed
to the Company.
(s) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management's general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(t) The Company has filed all federal, state, local and foreign income and
franchise tax returns and tax forms required to be filed. The Company is not in
default in the payment of any taxes which were payable pursuant to said returns
or any assessments with respect thereto, other than any which the Company is
contesting in good faith and as to which adequate reserves have been provided.
Such returns and forms are complete and correct in all material respects. The
Company has made all payroll withholdings required to be made by it with respect
to employees. The charges, accruals and reserves on the books of the Company in
respect of any tax liability for any year not finally determined are adequate to
meet any assessments or reassessments for additional taxes. There have been no
tax deficiencies asserted and, to the Company's knowledge, no tax deficiency
might be reasonably asserted or threatened against the Company that could
individually or in the aggregate have a Material Adverse Effect.
(u) The Company maintains insurance (issued by insurers of recognized
financial responsibility) of the types and in the amounts generally deemed
adequate for its business and, to the best of the Company's knowledge, generally
consistent with insurance coverage maintained by similar companies in similar
businesses, including, but not limited to, insurance covering real and personal
property owned or leased by the Company against theft, damage, destruction, acts
of vandalism and all other risks customarily insured against, and casualty and
liability (including but not limited to product liability) insurance covering
the Company's operations, all of which insurance is in full force and effect.
(v) Any advertising, sales literature or other promotional material
(including "prospectus wrappers," "broker kits," "road show slides" and "road
show scripts") authorized in writing by or prepared by the Company or the
Investment Adviser used in connection with the public offering of the Shares
(collectively, "sales material") does not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. All sales material complied and will
comply in all material respects with the applicable requirements of the 1933
Act, the 1940 Act, the Rules and Regulations and the rules and interpretations
of the National Association of Securities Dealers, Inc. ("NASD").
(w) The Company intends to direct the investment of the proceeds of the
offering described in the Prospectus in such a manner as to comply with the
requirements of Subchapter M of the Internal Revenue Code of 1986, as amended
("Subchapter M of the Code" and the "Code," respectively), and intends to
qualify as a regulated investment company under Subchapter M of the Code.
(x) Neither the Company nor its officers, directors, shareholders or
affiliates have taken, and such parties will not take, directly or indirectly,
any action designed to, or that might be reasonably expected to, cause or result
in or constitute, the stabilization or manipulation of the price of the Shares
to facilitate the sale or resale of the Shares.
(y) The Common Stock has been registered pursuant to Section 12(b) of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and the Shares
have been approved for listing on the American Stock Exchange (the "AMEX"),
subject to official notice of issuance.
(z) The Company has not incurred any liability for a fee, commission or
other compensation on account of the employment of a broker or finder in
connection with the transactions contemplated by this Agreement other than as
contemplated hereby.
(aa) Except for the sale and issuance to the Investment Adviser of 6,667
shares of Common Stock in accordance with Section 14 of the 1940 Act or as
otherwise described in the Prospectus, the Company has not sold or issued any
shares of Common Stock during the six-month period preceding the date of the
Prospectus, including any sales pursuant to Rule l44A under, or Regulations D or
S of, the 1933 Act Regulations.
(bb) The Company has good and marketable title to all personal property
owned by it, free and clear of all encumbrances and defects; and all personal
property held under lease by the Company is held by it under valid, subsisting
and enforceable leases, with such exceptions as are not material and do not
interfere with the use made and proposed to be made of such property by the
Company.
(cc) No relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers, shareholders, customers or
suppliers of the Company on the other hand, which is required to be described in
the Prospectus and which is not so described.
(dd) Any certificate signed by any officer of the Company delivered to the
Underwriters or to counsel for the Underwriters shall be deemed a representation
and warranty by the Company to each Underwriter as to the matters covered
thereby.
Section 2. Representations and Warranties Relating to the Investment Adviser
The Company and the Investment Adviser jointly and severally represent and
warrant to, and agree with, each of the Underwriters that:
(a) The Investment Adviser has been duly organized and is validly existing
as a limited liability company in good standing under the laws of its state of
organization, with all requisite corporate power and authority to own, lease and
license its properties, and conduct its business as currently conducted and as
proposed in the Prospectus to be conducted. The Investment Adviser has qualified
to do business and is in good standing as a foreign limited liability company in
every jurisdiction in which the ownership or leasing of its properties or the
nature or conduct of its business, as currently conducted and as proposed in the
Prospectus to be conducted, requires such qualification, except where the
failure to do so would not have a Material Adverse Effect.
(b) The Investment Adviser is registered with the Commission as an
investment adviser under the Advisers Act, and is not prohibited by the Advisers
Act or the 1940 Act, or the rules and regulations under such acts, from acting
under the Advisory Agreement for the Company as contemplated by the Prospectus.
(c) The description of the Investment Adviser in the Registration Statement
and the Prospectus did not violate and does not violate the provisions of the
1933 Act, the 1940 Act, the Rules and Regulations, the Advisers Act or the
Advisers Act Rules and Regulations and is true and correct and does not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(d) The Investment Adviser has the financial resources necessary for the
performance of its services and obligations as contemplated in the Prospectus,
this Agreement and under the Advisory Agreement.
(e) The Investment Adviser has the full legal right, power and authority to
enter into this Agreement and to consummate the transactions contemplated
herein. This Agreement has been duly authorized, executed and delivered by the
Investment Adviser and constitutes the valid and binding agreement of the
Investment Adviser enforceable against the Investment Adviser in accordance with
its terms, except to the extent that the indemnification provisions set forth in
Section 8 of this Agreement may be limited by applicable law or equitable
principles, and except as enforceability may be limited by bankruptcy,
reorganization, moratorium or similar laws affecting the enforceability of
creditors' rights generally and rules of law governing specific performance,
injunctive relief and other equitable remedies.
(f) The Investment Adviser is not in violation of its organizational
documents (including any operating agreement) and, as of the date hereof, no
default exists, and no event has occurred, nor state of facts exists, which,
with notice or after the lapse of time to cure or both, would constitute a
default in the due performance and observance of any obligation, agreement,
covenant, consideration or condition contained in any indenture, mortgage, deed
of trust, loan agreement, note, lease or other agreement or instrument to which
the Investment Adviser is a party or by which it or any of its properties is
subject, and no violation of any law, order, rule, regulation, writ, injunction
or decree of any government, governmental instrumentality or court, domestic or
foreign, has occurred or exists, in any such case where the consequences of such
violation or default would have a Material Adverse Effect.
(g) Except as described in the Prospectus, there is not pending, nor to the
Company's or the Investment Adviser's knowledge threatened, any action, suit,
proceeding, inquiry or investigation, against the Investment Adviser or any of
its officers, directors or members or to which the properties, assets or rights
of the Investment Adviser are subject, before or brought by any court or
governmental agency or body or board of arbitrators, which would, if determined
adversely to the Investment Adviser, have a Material Adverse Effect, or which
could prevent consummation of the transactions contemplated by this Agreement.
(h) The Investment Adviser owns, possesses or has obtained all permits,
licenses, franchises, certificates, consents, orders, approvals and other
authorizations of governmental or regulatory authorities and other third parties
as are necessary to own or lease, as the case may be, and to operate its
properties and to conduct its businesses as presently conducted and as proposed
in the Prospectus to be conducted, except where a failure to own, possess or
obtain such permits, licenses, franchises, certificates, consents, orders,
approvals and other authorizations would not have a Material Adverse Effect. The
Investment Adviser has not received any notice relating to termination,
revocation or modification of any such license, permit, franchise, certificate,
consent, order, approval or authorization, which termination, revocation or
modification would have a Material Adverse Effect.
(i) Any certificate signed by any officer of the Investment Adviser
delivered to the Underwriters or to counsel for the Underwriters shall be deemed
a representation and warranty by the Investment Adviser to each Underwriter as
to the matters covered thereby.
Section 3. Sale and Delivery of Shares to the Underwriters; Closing
(a) On the basis of the representations and warranties herein contained,
and subject to the terms and conditions herein set forth, the Company agrees to
sell to the Underwriters named in Schedule I hereto, and each such Underwriter
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of [$____] per share, the aggregate number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto.
(b) On the basis of the representations and warranties herein contained,
and subject to the terms and conditions herein set forth, the Company hereby
grant an option to the Underwriters, severally and not jointly, to purchase up
to an additional [ ] Option Shares on the same terms and conditions as the Firm
Shares. The option hereby granted will expire if not exercised within the 45 day
period after the first date on which the Firm Shares are released by you for
sale to the public. The option granted hereby may be exercised by you, as
Representative of the several Underwriters, in whole or in part (but not more
than once), only for the purpose of covering the over-allotments that may be
made in connection with the offering and distribution of the Firm Shares, by
giving written notice to the Company. The notice of exercise shall set forth the
number of Option Shares as to which the several Underwriters are exercising the
option, and the time and date of payment and delivery thereof. Such time and
date of delivery (the "Date of Delivery") shall be determined by you but shall
not be earlier than the second business day after the date on which the notice
of the exercise of the option shall have been given nor later than seven full
business days after the exercise of such option, nor in any event prior to the
Closing Time. If the option is exercised as to all or any portion of the Option
Shares, the Option Shares as to which the option is exercised shall be purchased
by the Underwriters, severally and not jointly, in their respective underwriting
obligation proportions.
(c) Payment of the purchase price for and delivery of the Firm Shares shall
be made at the offices of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or at such other place as shall be agreed upon by the
Company and you, at 9:00 A.M. (prevailing Eastern time), either (i) on the third
full business day after the effective date of the Registration Statement, or
(ii) at such other time not more than ten full business days thereafter as you
and the Company shall determine (unless, in either case, postponed pursuant to
Section 11 hereof) (such date and time of payment and delivery being herein
called the "Closing Time") (the Closing Time and each Date of Delivery, if any,
being sometimes referred to as a "Closing Date"). In addition, in the event that
any or all of the Option Shares are purchased by the Underwriters, payment of
the purchase price for and delivery of the Option Shares shall be made at the
offices of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc. in the manner set forth above, or at
such other place as the Company and you shall determine, on the Date of Delivery
as specified in the notice from you to the Company. Payment for the Firm Shares
and the Option Shares in immediately available funds shall be made by wire
transfer to the respective bank accounts designated by the Company against
delivery to you for the respective accounts of the Underwriters of the Shares to
be purchased by them.
(d) The Shares to be purchased by the Underwriters shall be in such
denominations and registered in such names as you may request in writing at
least two full business days before the Closing Time or the Date of Delivery, as
the case may be. The Shares will be made available at the offices of ▇▇▇▇▇▇
▇▇▇▇▇▇ & Company, Inc. or at such other place as ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc.
may designate for examination and packaging not later than 9:00 A.M. (prevailing
Eastern time) at least two full business days prior to the Closing Time or the
Date of Delivery, as the case may be.
(e) After the Registration Statement becomes effective, you intend to offer
the Shares to the public as set forth in the Prospectus, but after the initial
public offering of such Shares, you may from time to time increase or decrease
the public offering price, in your sole discretion, by reason of changes in
general market conditions or otherwise, in accordance with the 1940 Act and the
Rules and Regulations.
Section 4. Certain Covenants of the Company and the Investment Adviser
The Company and the Investment Adviser, jointly and severally, covenant and
agree with each Underwriter as follows:
(a) The Company will use its best efforts to cause the Registration
Statement to become effective (if not yet effective at the date and time that
this Agreement is executed and delivered by the parties hereto). If the Company
elects to rely upon Rule 430A of the Rules and Regulations or the filing of the
Prospectus is otherwise required under Rule 424(b) of the Rules and Regulations,
and subject to the provisions of Section 4(b) of this Agreement, the Company
will comply with the requirements of Rule 430A and will file the Prospectus,
properly completed, pursuant to the applicable provisions of Rule 424(b), within
the time period prescribed. If the Company elects to rely upon Rule 462(b), the
Company shall file a 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) by 10:00 A.M., prevailing Eastern time, on the date
of this Agreement, and the Company shall at the time of filing either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or give
irrevocable instructions for the payment of such fee. The Company will notify
you immediately and confirm the notice in writing (i) when the Registration
Statement, the 462(b) Registration Statement or any post-effective amendment to
the Registration Statement shall have become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (ii) of the receipt
of any comments from the Commission, (iii) of any request by the Commission to
amend the Registration Statement or the 462(b) Registration Statement or amend
or supplement the Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or any 462(b) Registration Statement or of any order
preventing or suspending the use of any Preliminary Prospectus, or of the
suspension of the qualification of the Shares for offering or sale in any
jurisdiction, or of the institution or threat of any proceedings for any of such
purposes. The Company will use every reasonable effort to prevent the issuance
of any such stop order or of any order preventing or suspending such use and, if
any such order is issued, use its reasonable efforts to obtain the withdrawal
thereof at the earliest possible moment.
(b) The Company will not at any time file or make any amendment to the
Registration Statement or any amendment or supplement (i) to the Prospectus, if
the Company has not elected to rely upon Rule 430A, or (ii) if the Company has
elected to rely upon Rule 430A, to either the Prospectus included in the
Registration Statement at the time it becomes effective or to the Prospectus
filed in accordance with Rule 424(b), or (iii) if the Company has elected to
rely upon Rule 462(b), to any 462(b) Registration Statement, in any case if you
shall not have previously been advised and furnished a copy thereof a reasonable
time prior to the proposed filing, or if you or counsel for the Underwriters
shall reasonably object to such amendment or supplement.
(c) The Company has furnished or will furnish to you, at the Company's
expense, as soon as available, as many signed copies of the Registration
Statement as originally filed and of all amendments thereto, whether filed
before or after the Registration Statement becomes effective, copies of all
exhibits and documents filed therewith and signed copies of all consents and
certificates of experts as you may reasonably request, and has furnished or will
furnish to each Underwriter one conformed copy of the Registration Statement as
originally filed and of each amendment thereto (but without exhibits).
(d) The Company will deliver to each Underwriter, at the Company's expense,
from time to time, as many copies of each Preliminary Prospectus as such
Underwriter may reasonably request, and the Company hereby consents to the use
of such copies for purposes permitted by the 1933 Act and the Rules and
Regulations. The Company will deliver to each Underwriter, at the Company's
expense, as soon as the Registration Statement shall have become effective, and
thereafter from time to time as requested during the period when the Prospectus
is required to be delivered under the 1933 Act, such number of copies of the
Prospectus (as supplemented or amended) as each Underwriter may reasonably
request. The Company will use its best efforts to comply with the 1933 Act and
the Rules and Regulations so as to permit the completion of the distribution of
the Shares as contemplated in this Agreement and in the Prospectus. In case you
are required to deliver a prospectus within nine months after the time of issue
of the Prospectus in connection with the offering or sale of the Shares and if
at such time any event shall have occurred as a result of which the Prospectus
as then amended or supplemented would include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any reason it shall be
necessary during such period to amend or supplement the Prospectus in order to
comply with the 1933 Act or the Rules and Regulations, the Company will notify
you and upon your request prepare promptly and furnish without charge to each
Underwriter and to any dealer in securities as many copies as you may from time
to time reasonably request of an amended Prospectus or a supplement to the
Prospectus that will correct such statement or omission or effect such
compliance. In case any Underwriter is required to deliver a prospectus in
connection with sales of any of the Shares at any time nine months or more after
the time of issue of the Prospectus, upon your request but at the expense of
such Underwriter, the Company will prepare and deliver to such Underwriter as
many copies as you may request of an amended or supplemented Prospectus
complying with the requirements of Section 10(a)(3) of the 1933 Act.
(e) The Company will use its best efforts, in cooperation with you, to
qualify the Shares for offering and sale under the applicable securities laws of
such states and other jurisdictions as you may designate and to maintain such
qualifications in effect for as long as may be necessary to complete the
distribution of the Shares; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation in any jurisdiction in which it is not otherwise so subject.
The Company will file such statements and reports as may be required by the laws
of each jurisdiction in which the Shares have been qualified as above provided.
(f) The Company will use the net proceeds received by it from the sale of
the Shares in the manner specified in the Prospectus under the caption "Use of
Proceeds."
(g) The Company will make generally available to its security holders as
soon as practicable, but in any event not later than the end of the fiscal
quarter first occurring after the first anniversary of the "effective date of
the Registration Statement" (as defined in Rule 158(c) of the Rules and
Regulations), an earnings statement (in reasonable detail but which need not be
audited) complying with the provisions of Section 11(a) of the 1933 Act and Rule
158 of the Rules and Regulations and covering a period of at least 12 months
beginning after the effective date of the Registration Statement.
(h) During a period of three years from the date hereof, the Company will
furnish to you: (i) copies of all reports mailed to shareholders of the Company;
and (ii) copies of all reports and financial statements furnished to or filed
with the Commission, AMEX, any other securities exchange or the NASD.
(i) For a period of 180 days from the date hereof (the "Lock-Up Period"),
the Company will not, without your prior written consent, directly or
indirectly, sell, offer to sell, grant any option for the sale of, hypothecate,
pledge, enter into any transaction which is designed to, or might reasonably be
expected to, result in the disposition (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise) by the
Company or any affiliate, or otherwise issue or dispose of, any Common Stock or
securities convertible into or exchangeable or exercisable for Common Stock, or
register or publicly announce any intent to register under the 1933 Act the
offer or sale of any capital stock of the Company, except for the registration
of the offer and sale of the Shares and sales to the Underwriters pursuant to
this Agreement. The Company will not, and will use its best efforts to cause its
officers, directors and affiliates not to, take, directly or indirectly, prior
to the termination of the underwriting syndicate contemplated by this Agreement,
any action designed to stabilize or manipulate the price of any security of the
Company, or any action which may cause or result in, or which might in the
future reasonably be expected to cause or result in, the stabilization or
manipulation of the price of any security of the Company, to facilitate the sale
or resale of any of the Shares.
(j) The Company will maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar (which may be the same
entity as the transfer agent) for its Common Stock.
(k) For as long as the Common Stock of the Company is publicly traded, the
Company will use it best efforts to maintain the listing of its shares of Common
Stock on the AMEX.
(l) If at any time during the 30-day period after the Registration
Statement becomes effective, any publication or event relating to or affecting
the Company shall occur as a result of which in your reasonable opinion the
market price of the Common Stock has been or is likely to be materially affected
(regardless of whether such publication or event necessitates a supplement or
amendment of the Prospectus), the Company agrees to forthwith consult and
cooperate with you concerning the Company's response to or comment on such
publication or event.
(m) The Company, during the period when the Prospectus is required to be
delivered under the 1933 Act or the 1934 Act, will file all documents required
to be filed with the Commission pursuant to the 1940 Act and the 1934 Act within
the time periods required by the 1940 Act and the Rules and Regulations and the
1934 Act and the rules and regulations of the Commission thereunder,
respectively.
(n) The Company will file timely and accurate information with the
Commission in accordance with Rule 463 of the Rules and Regulations or any
successor provision.
(o) The Company will direct the investment of the proceeds of the offering
described in the Registration Statement and in the Prospectus in such a manner
as to comply with the requirements of Subchapter M of the Code, and will use its
best efforts to maintain its qualification as a regulated investment company
under Subchapter M of the Code.
(p) The Company will supply the Underwriters with copies of all
correspondence to and from and all documents issued to and by the Commission or
the Commission staff in connection with the registration of the Shares under the
1933 Act.
Section 5. Payment of Expenses
(a) The Company will pay or cause to be paid and bear all costs, fees and
expenses incident to the performance of its obligations under this Agreement,
including (i) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits), as originally filed and as
amended, the Preliminary Prospectus and the Prospectus and any amendments or
supplements thereto, and the cost of furnishing copies thereof to the
Underwriters; (ii) the preparation, printing and distribution of this Agreement,
the Selected Dealer Agreement, and any instruments relating to any of the
foregoing; (iii) the issuance and delivery of the Shares to the Underwriters,
including any transfer taxes payable upon the sale of the Shares to the
Underwriters (other than transfer taxes on resales by the Underwriters); (iv)
the fees and disbursements of the Company's counsel and accountants; (v) the
qualification of the Shares under the applicable securities laws in accordance
with Section 4(e) hereof and any filing for review of the offering with the
NASD, including filing fees and fees and disbursements of counsel for the
Underwriters in connection therewith; (vi) the transfer agent's and registrar's
fees and all miscellaneous expenses referred to in Item 26 of the Registration
Statement; (vii) costs related to travel and lodging incurred by the Company and
its representatives relating to meetings with and presentations to prospective
purchasers of the Shares; and (viii) all other costs and expenses incident to
the performance of the Company's obligations hereunder (including costs incurred
in closing the purchase of the Option Shares, if any) that are not otherwise
specifically provided for in this section. The Company, upon your request, will
provide funds in advance for filing fees in connection with "blue sky"
qualifications and the NASD.
Section 6. Conditions of Underwriters' Obligations
The obligations of the Underwriters to purchase and pay for the Shares that
they have severally agreed to purchase pursuant to this Agreement (whether Firm
Shares at the Closing Time or, upon exercise of the option granted in Section 3,
Option Shares on the Date of Delivery) are subject to the following conditions:
(a) The Registration Statement shall have become effective not later than
5:30 P.M., prevailing Eastern time, on the date of this Agreement or, with your
consent, at a later time and date not later, however, than 5:30 P.M., prevailing
Eastern time, on the first business day following the date hereof, or at such
later time or on such later date as you may agree to in writing; as of the
Closing Date the Registration Statement shall remain effective and no stop order
suspending the effectiveness of the Registration Statement shall have been
issued under the 1933 Act, no notice or order pursuant to Section 8(e) of the
1940 Act shall have been issued, and no proceedings for either such purpose
shall have been instituted or shall be pending or, to your knowledge or the
knowledge of the Company or the Investment Adviser, shall be contemplated by the
Commission, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of
counsel for the Underwriters. If the Company has elected to rely upon Rule 430A,
a prospectus containing the Rule 430A Information shall have been filed with the
Commission in accordance with Rule 424(b) (or a post-effective amendment
providing such information shall have been filed and declared effective in
accordance with the requirements of Rule 430A).
(b) You shall have received the favorable opinion, dated the Closing Date,
of ▇▇▇▇▇▇▇▇ & Worcester, LLP, counsel for the Company, with respect to the
Company, together with signed or reproduced copies of such opinions for each of
the other Underwriters, in form and substance satisfactory to you and counsel
for the Underwriters, stating that:
(i) the Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Maryland, is
duly qualified to do business and is in good standing as a foreign
corporation in each jurisdiction within the United States in which its
ownership or lease of property or the conduct of its business requires such
qualification, except where the failure to be so qualified or in good
standing would not have a Material Adverse Effect;
(ii) the Company has all power and authority necessary to own or hold
its properties and to conduct its business as described in the Registration
Statement and the Prospectus;
(iii) the authorized, issued and outstanding capital stock as of
October _____,2003 is as set forth under the heading "Description of
Capital Stock" in the Prospectus, and all of the issued shares of capital
stock of the Company have been duly and validly authorized and issued and
are fully paid and non-assessable;
(iv) the outstanding shares of capital stock of the Company are free
of statutory and contractual preemptive rights and have been issued in
compliance with all state and federal securities laws; to such counsel's
knowledge, there are no outstanding securities of the Company convertible
or exchangeable into, or evidencing the right to purchase or subscribe for,
any shares of capital stock of the Company, and there are no outstanding or
authorized options, warrants or rights of a similar character obligating
the Company to issue any shares of its capital stock or any securities
convertible or exchangeable into, or evidencing the right to purchase or
subscribe for, any shares of such capital stock; there are no restrictions
upon the voting or transfer of any shares of the Company's capital stock
pursuant to the Company's Certificate of Incorporation or Bylaws or any
agreement or other instrument known to such counsel;
(v) the Shares being delivered by the Company to the Underwriters
hereunder have been duly and validly authorized and, when issued and
delivered against payment therefor, will be duly and validly issued, fully
paid and non-assessable;
(vi) to such counsel's knowledge and other than as set forth in the
Prospectus, there are no legal or governmental proceedings pending to which
the Company is a party or of which any property or assets of the Company is
the subject which is required to be set forth in the Prospectus;
(vii) the Registration Statement and the Prospectus and any further
amendments or supplements thereto made by the Company (except as to the
financial statements and schedules and other financial data contained
therein, as to which such counsel need express no opinion) comply in all
material respects with the requirements of the 1933 Act, the 1940 Act and
the Rules and Regulations, and no amendment to the Registration Statement
is required to be filed which has not been filed;
(viii) the Registration Statement was declared effective under the
1933 Act as of the date and time specified in such opinion, any required
filing with the Commission of the Prospectus pursuant to Rule 424 of the
Rules and Regulations was made as of the date specified in such opinion,
and, to the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued under the 1933
Act, no order of suspension or revocation of registration pursuant to
Section 8(e) of the 1940 Act has been issued, and no proceeding for either
such purpose is pending or threatened by the Commission;
(ix) the information in the Prospectus under the captions "Management
of the Fund," "Automatic Dividend Reinvestment Plan," "Description of
Capital Stock" and "Federal Taxation;" in the Statement of Additional
Information under the captions "Management of the Fund," "The Adviser and
Administrator" and "Taxation;" and in the Registration Statement under
Section 29 (Indemnification), to the extent that it constitutes summaries
of legal matters, summaries of the documents described therein, or legal
conclusions, has been reviewed by such counsel, is correct in all material
respects and constitutes a fair summary of the subject matter thereof;
(x) the organizational documents of each of the Company and the
Investment Adviser and this Agreement complies as to form in all material
respects with the applicable provisions of the 1940 Act, the Advisers Act,
the Rules and Regulations and the Adviser Act Rules and Regulations;
(xi) the Company is registered with the Commission under the 1940 Act
as a non-diversified, closed-end management investment company. To such
counsel's knowledge, no order of suspension or revocation of such
registration has been issued or proceedings therefor initiated or
threatened in writing by the Commission.
(xii) to such counsel's knowledge, no person is serving as an officer,
director or investment adviser of the Company except in accordance with the
1940 Act and the Rules and Regulations and the Advisers Act and the
Advisers Act Rules and Regulations. Except as disclosed in the Registration
Statement and Prospectus, to such counsel's knowledge, no director of the
Company is an "interested person" (as defined in the ▇▇▇▇ ▇▇▇) of an
Underwriter.
(xiii) to such counsel's knowledge, there are no contracts or other
documents which are required to be described in the Prospectus or filed as
exhibits to the Registration Statement by the 1933 Act, the 1940 Act or the
Rules and Regulations which have not been so described or filed as exhibits
to the Registration Statement;
(xiv) this Agreement has been duly authorized, executed and delivered
by the Company;
(xv) the issue and sale of the Shares being delivered by the Company
pursuant to this Agreement and the execution, delivery and compliance by
the Company with all of the provisions of this Agreement and the
consummation of the transactions contemplated hereby will not conflict with
or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to such counsel to which
the Company is a party or by which the Company is bound or to which any of
the property or assets of the Company is subject, nor will such actions
result in any violation of the provisions of the Certificate of
Incorporation or Bylaws of the Company or any statute, order, rule or
regulation known to such counsel of any court or governmental agency or
body having jurisdiction over the Company or any of its properties or
assets; and, except for the registration of the Shares under the 1933 Act
and the 1940 Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the 1934 Act and
applicable state securities laws in connection with the purchase and
distribution of the Shares by the Underwriters, no consent, approval,
authorization or order of, or filing or registration with, any court or
governmental agency or body is required for the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby, except for such consents, approvals, authorizations,
orders, filings or registrations as have been obtained or made;
(xvi) there are no statutes or regulations that are required under the
1940 Act or the 1933 Act to be described in the Prospectus that are not
described as required in all material respects;
(xvii) to such counsel's knowledge, there are no contracts, agreements
or understandings between the Company and any person granting such person
the right to require the Company to file a registration statement under the
1933 Act and the 1940 Act with respect to any securities of the Company
owned or to be owned by such person or to require the Company to include
such securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the 1933 Act and the 1940
Act; and
(xviii) such opinion shall also be to the effect that (x) such counsel
has acted as counsel to the Company and the Investment Adviser in
connection with the preparation of the Registration Statement, and (y)
based on the foregoing, no facts have come to the attention of such counsel
which lead them to believe that the Registration Statement (except for the
financial statements and financial schedules and other financial data
included therein, as to which such counsel need express no belief), as of
the Closing Date, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading, or that the
Prospectus (except as stated above) contains any untrue statement of a
material fact or omits to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. The foregoing
opinion and statement may be qualified by a statement to the effect that
such counsel does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or the Prospectus (other than as set forth in clause (ix) above).
(c) You shall have received the favorable opinion, dated the Closing Date,
of ▇▇▇▇▇▇▇▇ & Worcester, LLP, counsel for the Investment Adviser, with respect
to the Company, together with signed or reproduced copies of such opinions for
each of the other Underwriters, in form and substance satisfactory to you and
counsel for the Underwriters, stating that:
(i) the Adviser has been duly organized and is validly existing as a
limited liability company in good standing under the laws of the State of
Delaware, is duly qualified to do business and is in good standing as a
foreign limited liability company in each jurisdiction within the United
States in which its ownership or lease of property or the conduct of its
business requires such qualification, except where the failure to be so
qualified or in good standing would not have a Material Adverse Effect;
(ii) the Adviser has all power and authority necessary to own or hold
its properties and to conduct its business as described in the Registration
Statement and the Prospectus;
(iii) the Adviser is registered with the Commission as an investment
adviser under the Advisers Act and is not prohibited by the Advisers Act,
the Advisers Act Rules and Regulations, the 1940 Act or the Rules and
Regulations from acting under the Advisory Agreement as contemplated by the
Prospectus;
(iv) This Agreement and the Advisory Agreement have been duly
authorized by all requisite corporate action on the part of the Adviser,
have each been executed and delivered on behalf of the Adviser and each
constitutes a valid and binding obligation of the Adviser, enforceable
against the Adviser in accordance with its terms;
(v) to such counsel's knowledge and other than as set forth in the
Prospectus, there are no legal or governmental proceedings pending to which
the Adviser is a party or of which any property or assets of the Adviser is
the subject which is required to be set forth in the Prospectus;
(vi) no filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any court or governmental
authority or agency of the United States or the State of Delaware (other
than (i) under the 1933 Act, the 1940 Act and the Rules and Regulations;
(ii) such as have been obtained; and (iii) as may be required under the
securities or blue sky laws of the various states, as to each of which such
counsel expresses no opinion) is necessary or required in connection with
the performance by the Adviser of its obligations under this Agreement.
(vii) the execution and delivery of this Agreement by the Adviser and
performance by the Adviser of its obligations hereunder do not and will
not, whether with or without the giving of notice or lapse of time or both,
violate or constitute a breach of, or a default or repayment event under,
or result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Adviser pursuant to, any material
contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or any other material agreement or instrument known to such
counsel and to which the Adviser 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
for conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a Material Adverse Effect on the Investment Adviser), nor
will such action result in any violation of the provisions of the
organization documents of the Adviser, or any applicable material federal
or State of Delaware law, statute, rule, or regulation, or any judgment,
order, writ or decree, known to such counsel, of any governmental authority
or administrative agency of the United States of America or the State of
Delaware.
(d) You shall have received a favorable opinion from Hunton & ▇▇▇▇▇▇▇▇ LLP,
counsel for the Underwriters, dated the Closing Date, with respect to the
Registration Statement, the Prospectus and other related matters as the
Underwriters may reasonably require, and the Company shall have furnished to
such counsel such documents as they reasonably request for the purpose of
enabling them to pass upon such matters.
(e) As of the Closing Date,
(i) the Registration Statement, any 462(b) Registration Statement, and
the Prospectus, as they may then be amended or supplemented, shall contain
all statements that are required to be stated therein under the 1933 Act,
the 1940 Act and the Rules and Regulations and in all respects shall
conform to the requirements of the 1933 Act, the 1940 Act and the Rules and
Regulations, the Company shall have complied in all respects with Rule 430A
(if it shall have elected to rely thereon) and neither the Registration
Statement, any 462(b) Registration Statement nor the Prospectus, as they
may then be amended or supplemented, shall contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(ii) there shall not have been any change in the capital stock or
long-term debt of the Company or any change, or any development involving a
prospective change, in or affecting the business, general affairs,
management, condition (financial or otherwise), shareholders' equity,
results of operations, properties or prospects of the Company, otherwise
than as set forth in the Prospectus, the effect of which is, in your
judgment, so material and adverse as to make it impracticable or
inadvisable to proceed with the completion of the public offering or the
sale of or payment for the Shares;
(iii) no action, suit or proceeding at law or in equity before or by
any federal, state or other commission, court, board or administrative
agency shall be pending or, to the best of the Company's and the Investment
Adviser's knowledge, threatened against the Company or the Investment
Adviser that would be required to be set forth in the Prospectus, other
than as set forth therein, wherein an unfavorable decision, ruling or
finding would have a Material Adverse Effect;
(iv) the Company and the Investment Adviser shall have complied with
all agreements and satisfied all conditions contained herein in all
respects on their respective parts to be performed or satisfied at or prior
to such Closing Date; and
(v) the representations and warranties of the Company and the
Investment Adviser set forth in Sections 1 and 2 shall be accurate in all
respects as though expressly made at and as of such Closing Date. You shall
have received certificates, dated as of such Closing Date, executed by the
President and Chief Executive Officer of each of the Company and the
Investment Adviser to such effect and with respect to the following
additional matters:
(A) the Registration Statement has become effective under the
1933 Act and the 1940 Act and no stop order suspending the
effectiveness of the Registration Statement or preventing or
suspending the use of the Prospectus has been issued, no order of
suspension or revocation of registration pursuant to Section 8(e) of
the 1940 Act has been issued, and no proceedings for either such
purpose have been instituted or are pending or, to the best of their
knowledge, threatened under the 1933 Act or the 1940 Act;
(B) they have carefully reviewed the Registration Statement, any
462(b) Registration Statement and the Prospectus and when the
Registration Statement and any 462(b) Registration Statement became
effective and at all times subsequent thereto up to the delivery of
such certificate, the Registration Statement, any 462(b) Registration
Statement and the Prospectus and any amendments or supplements thereto
contained all statements and information required to be included
therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, and neither the
Registration Statement, any 462(b) Registration Statement, the
Prospectus nor any amendment or supplement thereto included any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the
statements therein not misleading, and, since the effective date of
the Registration Statement, there has occurred no event required to be
set forth in an amended or supplemented Prospectus that has not been
so set forth, and
(C) all agreements herein to be performed by the Company and the
Investment Adviser, respectively, on or prior to such Closing Date
have been duly performed.
(f) On the business day preceding the date of this Agreement, you
shall have received from Ernst & Young LLP a letter addressed to the
Underwriters and dated the date hereof, in form and substance satisfactory
to you, together with signed or reproduced copies of such letter(s) for
each of the other Underwriters containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial information
contained in the Registration Statement and the Prospectus.
(g) As of such Closing Date, you shall have received from Ernst &Young
LLP a letter, dated as of the Closing Date, to the effect that they
reaffirm the statements made in the letter furnished pursuant to subsection
(f) of this Section, except that the specified date referred to shall be a
date not more than three business days prior to such Closing Date.
(h) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or
in the over-the-counter market shall have been suspended or the settlement
of such trading generally shall have been materially disrupted or minimum
prices shall have been established on any such exchange or such market by
the Commission, by such exchange or by any other regulatory body or
governmental authority having jurisdiction, (ii) a banking moratorium shall
have been declared by federal or state authorities, (iii) the United States
shall have become engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or there shall have
been a declaration of a national emergency or war by the United States or
(iv) there shall have occurred such a material adverse change in general
economic, political or financial conditions, including without limitation
as a result of terrorist activities after the date hereof, or the effect of
international conditions on the financial markets in the United States
shall be such as to make it, in your judgment, impracticable or inadvisable
to proceed with the completion of the public offering or the sale of or
payment for the Shares.
(i) As of such Closing Date, counsel for the Underwriters shall have
been furnished with all such documents, certificates and opinions as they
may reasonably request for the purpose of enabling them to pass upon the
issuance and sale of the Shares as contemplated in this Agreement and the
matters referred to in Section 6(e) and in order to evidence the accuracy
and completeness of any of the representations and warranties or statements
of the Company and the Investment Adviser, the performance of any of the
covenants of the Company and the Investment Adviser, or the fulfillment of
any of the conditions herein contained; and all proceedings taken by the
Company and the Investment Adviser at or prior to such Closing Date in
connection with the authorization, issuance and sale of the Shares as
contemplated in this Agreement shall be reasonably satisfactory in form and
substance to you and to counsel for the Underwriters. The Company and the
Investment Adviser will furnish you with such number of conformed copies of
such opinion, certificates, letters and documents as you shall request.
(j) The NASD, upon review of the terms of the public offering of the
Shares, shall not have objected to such offering, such terms or the
Underwriters' participation in the same.
(k) The Firm Shares and the Option Shares, if any, shall have been
approved for listing on the AMEX upon official notice of the issuance, sale
and evidence of satisfactory distribution thereof pursuant to this
underwritten public offering.
(l) Each officer, director and shareholder of the Company as of the
date of this Agreement shall have agreed in writing as to the matters set
forth in Section 1(m).
If any of the conditions specified in this Section 6 shall not have
been fulfilled when and as required by this Agreement to be fulfilled, this
Agreement may be terminated by you on notice to the Company at any time at
or prior to such Closing Date, and such termination shall be without
liability of any party to any other party.
Section 7. [Intentionally Omitted]
Section 8. Indemnification and Contribution
(a) The Company and the Investment Adviser will indemnify and hold
harmless each Underwriter, its partners, directors and officers and each
person, if any, who controls any Underwriter within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act, and the successors and
assigns of all such persons, from and against any losses, claims, damages
or liabilities, joint or several, to which any such Underwriter or any such
other person may become subject under the 1933 Act, the 1940 Act, the 1934
Act, common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof arise out of or are based upon
any breach of any representation, warranty or covenant of the Company or
the Investment Adviser herein contained or any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement, any 462(b) Registration Statement, any Preliminary Prospectus,
the Prospectus, or any amendment or supplement thereto, or in any `blue
sky" application or other document executed by the Company or based upon
any information furnished in writing by the Company filed in any
jurisdiction in order to qualify any or all of the Shares under the
securities laws thereof ("Blue Sky Application"), or arise out of or are
based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances in which they were made, not
misleading, and will reimburse each Underwriter and each such partner,
director, officer, employee and controlling person for any legal or other
expenses reasonably incurred by such Underwriter, partner, director,
officer, employee or controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action; provided,
however, that neither the Company nor the Investment Adviser shall be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration
Statement, such 462(b) Registration Statement, such Preliminary Prospectus
or the Prospectus, or such amendment or supplement, or any Blue Sky
Application in reliance upon and in conformity with written information
furnished to the Company by you or by any Underwriter through you expressly
for use therein, it being understood and agreed that the only such
information furnished by you or by any Underwriter through you consists of
the information specified in Section 8(g) below; provided, further, that
the Company and the Investment Adviser will not be liable for any such
losses, claims, damages, or liabilities arising from the sale of the Shares
to any person if a copy of the Prospectus (as first filed pursuant to Rule
424(b)) or the Prospectus as amended or supplemented by all amendments or
supplements thereto which has been furnished to the Underwriters (within a
reasonable amount of time prior to such sale) shall not have been sent,
mailed or given to such person, at or prior to the written confirmation of
the sale of such Shares to such person, but only if and to the extent that
such Prospectus, if so sent or delivered, would have cured the defect
giving rise to, and been a complete defense against the person asserting,
such loss, claim, damage or liability. In addition to its other obligations
under this Section 8(a), the Company and the Investment Adviser agree that,
as an interim measure during the pendency of any such claim, action,
investigation, inquiry or other proceeding arising out of or based upon any
breach or any statement or omission, or any alleged statement or omission,
described in this Section 8(a), it will reimburse the Underwriters, their
partners, directors, officers, employees and controlling persons on a
monthly basis for all reasonable legal and other expenses incurred in
connection with investigating or defending any such claim, action,
investigation, inquiry or other proceeding, notwithstanding the absence of
a judicial determination as to the propriety and enforceability of the
Company's and the Investment Adviser's obligation to reimburse the
Underwriters and such other persons for such expense and the possibility
that such payments might later be held to have been improper by a court of
competent jurisdiction. Any such interim reimbursement payments that are
not made to an Underwriter or any such other person within 30 days of a
request for reimbursement shall bear interest at the prime rate (or
reference rate or other commercial lending rate for borrowers of the
highest credit standing) announced from time to time by National Bank of
Commerce, Memphis, Tennessee (the "Prime Rate") from the date of such
request. This indemnity agreement shall be in addition to any liabilities
that the Company and the Investment Adviser may otherwise have.
(b) Each Underwriter, severally but not jointly, will indemnify and
hold harmless the Company and the Investment Adviser against any losses,
claims, damages or liabilities to which the Company or the Investment
Adviser may become subject under the 1933 Act, the 1940 Act, the 1934 Act,
common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any breach of any warranty or covenant by the Underwriters herein contained
or any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, any 462(b) Registration Statement,
any Preliminary Prospectus, the Prospectus, or any amendment or supplement
thereto, or any Blue Sky Application or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in light
of the circumstances in which they were made, not misleading, in each case
to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in the
Registration Statement, such 462(b) Registration Statement, such
Preliminary Prospectus or the Prospectus, or such amendment or supplement,
or any Blue Sky Application, in reliance upon and in conformity with
information furnished to the Company by such Underwriter expressly for use
therein, it being understood and agreed that the only such information
furnished by any Underwriter consists of the information specified in
Section 8(g) below, and will reimburse the Company and the Investment
Adviser for any legal or other expenses reasonably incurred by the Company
or the Investment Adviser in connection with investigating or defending any
such loss, claim, damage, liability or action. In addition to their other
obligations under this Section 8(b), the Underwriters agree that, as an
interim measure during the pendency of any such claim, action,
investigation, inquiry or other proceeding arising out of or based upon any
breach or any statement or omission, or any alleged statement or omission,
described in this Section 8(b), they will reimburse the Company and the
Investment Adviser on a monthly basis for all reasonable legal and other
expenses incurred in connection with investigating or defending any such
claim, action, investigation, inquiry or other proceeding, notwithstanding
the absence of a judicial determination as to the propriety and
enforceability of their obligation to reimburse the Company or the
Investment Adviser for such expense and the possibility that such payments
might later be held to have been improper by a court of competent
jurisdiction. Any such interim reimbursement payments that are not made to
the Company or the Investment Adviser within 30 days of a request for
reimbursement shall bear interest at the Prime Rate from the date of such
request. This indemnity agreement shall be in addition to any liabilities
that the Underwriters may otherwise have.
The indemnity agreement in this Section 8(b) shall extend upon the
same terms and conditions to, and shall inure to the benefit of, each
director of the Company or the Investment Adviser, each officer of the
Company who signed the Registration Statement, and each person, if any, who
controls the Company or the Investment Adviser within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act, to the same
extent as such agreement applies to the Company and the Investment Adviser.
(c) Within ten days after receipt by an indemnified party under
subsection (a) or (b) above of notice of commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify the
indemnifying party in writing of the commencement thereof. No
indemnification provided in Sections 8(a) or 8(b) shall be available to any
party who shall fail to give notice as provided in this Section 8(c) if the
party to whom notice was not given was unaware of the proceeding to which
such notice would have related and was prejudiced by the failure to give
such notice, but the omission so to notify the indemnifying party will not
relieve the indemnifying party from any liability that it may have to any
indemnified party otherwise than under this Section 8. In case any such
action shall be brought against any indemnified party and it shall notify
the indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate therein, and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such indemnified
party, and after notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof, the indemnifying
party shall not be liable to such indemnified party for any legal or other
expenses, other than reasonable costs of investigation subsequently
incurred by such indemnified party in connection with the defense thereof.
The indemnified party shall have the right to employ its own counsel in any
such action, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the employment of counsel by
such indemnified party has been authorized by the indemnifying party, (ii)
the indemnified party shall have been advised by such counsel that there
may be a conflict of interest between the indemnifying party and the
indemnified party in the conduct of the defense of such action (in which
case the indemnifying party shall not have the right to direct the defense
of such action on behalf of the indemnified party), or (iii) the
indemnifying party shall not in fact have employed counsel to assume the
defense of such action, in any of which events such fees and expenses shall
be borne by the indemnifying party. The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment
for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
(d) It is agreed that any controversy arising out of the operation of
the interim reimbursement arrangements set forth in Sections 8(a) and 8(b)
hereof, including the amounts of any requested reimbursement payments, the
method of determining such amounts and the basis on which such amounts
shall be apportioned among the indemnifying parties, shall be settled by
arbitration conducted pursuant to the Code of Arbitration Procedure of the
NASD. Any such arbitration must be commenced by service of a written demand
for arbitration or a written notice of intention to arbitrate, therein
electing the arbitration tribunal. In the event the party demanding
arbitration does not make such designation of an arbitration tribunal in
such demand or notice, then the party responding to said demand or notice
is authorized to do so. Any such arbitration will be limited to the
operation of the interim reimbursement provisions contained in Sections
8(a) and 8(b) hereof and will not resolve the ultimate propriety or
enforceability of the obligation to indemnify for expenses that is created
by the provisions of Sections 8(a) and 8(b).
(e) In order to provide for just and equitable contribution in
circumstances under which the indemnity provided for in this Section 8 is
for any reason judicially determined (by the entry of a final judgment or
decree by a court of competent jurisdiction and the expiration of time to
appeal or the denial of the last right of appeal) to be unenforceable by
the indemnified parties although applicable in accordance with its terms,
the Company, the Investment Adviser and the Underwriters shall contribute
to the aggregate losses, liabilities, claims, damages and expenses of the
nature contemplated by such indemnity incurred by the Company, the
Investment Adviser and one or more of the Underwriters, as incurred, in
such proportions that (i) the Underwriters are responsible pro rata for
that portion represented by the underwriting discount appearing on the
cover page of the Prospectus bears to the public offering price (before
deducting expenses) appearing thereon, and (ii) the Company and the
Investment Adviser are responsible for the balance; provided, however, that
no person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f)(1) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation;
provided, further, that if the allocation provided above is not permitted
by applicable law, the Company, the Investment Adviser and the Underwriters
shall contribute to the aggregate losses in such proportion as is
appropriate to reflect not only the relative benefits referred to above but
also the relative fault of the Company, the Investment Adviser and the
Underwriters in connection with the statements or omissions which resulted
in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. Relative fault 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 Company, by the
Investment Adviser or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of
the losses, claims, damages or liabilities referred to above shall be
deemed to include any legal or other fees or expenses reasonably incurred
by such party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 8(e), no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. For purposes of this Section 8(e), the partners, directors,
officers and employees and each person, if any, who controls an Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act shall have the same rights to contribution as such Underwriter, and
each director of the Company and the Investment Adviser, each officer of
the Company who signed the Registration Statement and each person, if any,
who controls the Company or the Investment Adviser within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the
same rights to contribution as the Company and the Investment Adviser.
(f) The parties to this Agreement acknowledge that they are
sophisticated business persons who were represented by counsel during the
negotiations regarding the provisions of this Agreement, including without
limitation the provisions of this Section 8, and are fully informed
regarding such provisions. They further acknowledge that the provisions of
this Section 8 fairly allocate the risks in light of the ability of the
parties to investigate the Company and the Investment Adviser and their
businesses in order to assure that adequate disclosure is made in the
Registration Statement and Prospectus as required by the 1933 Act and the
▇▇▇▇ ▇▇▇. The parties are advised that federal or state public policy, as
interpreted by the courts in certain jurisdictions, may be contrary to
certain of the provisions of this Section 8, and the parties hereto hereby
expressly waive and relinquish any right or ability to assert such public
policy as a defense to a claim under this Section 8 and further agree not
to attempt to assert any such defense.
(g) For purposes of this Section 8, the Underwriters severally
confirm, and the Company and the Investment Adviser acknowledge, that the
concession and reallowance figures appearing in the second paragraph under
the caption "Underwriting" and the information set forth under the heading
"Stabilization, Short Positions and Penalty Bids" under the caption
"Underwriting" in any Preliminary Prospectus and in the Prospectus
constitutes the only information furnished by the Underwriters to the
Company for inclusion in any Preliminary Prospectus, the Prospectus or the
Registration Statement.
Section 9. Representations and Agreements to Survive Delivery
The representations, warranties, inde mnities, agreements and other
statements of the Company and the Investment Adviser set forth in or made
pursuant to this Agreement will remain operative and in full force and
effect regardless of any investigation made by or on behalf of the Company,
the Investment Adviser, any Underwriter or any representative, officer,
director or any controlling person with respect to an Underwriter, the
Company or the Investment Adviser, and will survive delivery of and payment
for the Shares or termination of this Agreement.
Section 10. Effective Date of Agreement and Termination
(a) This Agreement shall become effective immediately as to Sections 5
and 8 and, as to all other provisions, (i) if at the time of execution of
this Agreement the Registration Statement has not become effective, at 9:00
A.M., prevailing Eastern time, on the first full business day following the
effectiveness of the Registration Statement, or (ii) if at the time of
execution of this Agreement, the Registration Statement has been declared
effective, at 9:00 A.M., prevailing Eastern time, on the first full
business day following the date of execution of this Agreement; but this
Agreement shall nevertheless become effective at such earlier time after
the Registration Statement becomes effective as you may determine on and by
notice to the Company or by release of any of the Shares for sale to the
public. For the purposes of this Section 10, the Shares shall be deemed to
have been so released upon the release for publication of any newspaper
advertisement relating to the Shares or upon the release by you of
telegrams or facsimile messages (i) advising the Underwriters that the
Shares are released for public offering, or (ii) offering the Shares for
sale to securities dealers, whichever may occur first. By giving notice
before the time this Agreement becomes effective, you, as the
Representative of the several Underwriters, or the Company, may prevent
this Agreement from becoming effective, without liability of any party to
any other party, except that the Company shall remain obligated to pay
costs and expenses to the extent provided in Section 5 hereof.
(b) You may terminate this Agreement by notice to the Company at any
time at or prior to the Closing Date in accordance with the last paragraph
of Section 6 of this Agreement.
(c) If this Agreement is terminated pursuant to this Section 10, such
termination shall be without liability of any party to any other party,
except that, notwithstanding any such termination, (i) the provisions of
Section 5 and Section 8 shall remain in effect, and (ii) if any Shares have
been purchased hereunder, the representations and warranties in Section 1
and Section 2 and all obligations under Section 4 shall also remain in
effect.
Section 11. Default by One or More of the Underwriters
(a) If any Underwriter shall default in its obligation to purchase the
Firm Shares that it has agreed to purchase hereunder, you may in your
discretion arrange for you or another party or other parties to purchase
such Firm Shares on the terms contained herein. If within 36 hours after
such default by any Underwriter you do not arrange for the purchase of such
Firm Shares, then the Company shall be entitled to a further period of 36
hours within which to procure another party or other parties satisfactory
to you to purchase such Firm Shares on such terms. In the event that,
within the respective prescribed periods, you notify the Company that you
have so arranged for the purchase of such Firm Shares, or the Company
notifies you that it has so arranged for the purchase of such Firm Shares,
you or the Company shall have the right to postpone the Closing Time for a
period of not more than seven days in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Prospectus,
or in any other documents or arrangements, and the Company agrees to file
promptly any amendments to the Registration Statement or the Prospectus
which in your opinion may thereby be made necessary. The term "Underwriter"
as used in this Agreement shall include any persons substituted under this
Section 11 with like effect as if such person had originally been a party
to this Agreement with respect to such Firm Shares.
(b) If, after giving effect to any arrangements for the purchase of
the Firm Shares of a defaulting Underwriter or Underwriters made by you or
the Company as provided in subsection (a) above, the aggregate number of
Firm Shares that remains unpurchased does not exceed [100,000], then the
Company shall have the right to require each non-defaulting Underwriter to
purchase the Firm Shares which such Underwriter agreed to purchase
hereunder and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Firm Shares which such
Underwriter agreed to purchase hereunder) of the Firm Shares of such
defaulting Underwriter or Underwriters for which such arrangements have not
been made; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
(c) If, after giving effect to any arrangements for the purchase of
the Firm Shares of a defaulting Underwriter or Underwriters made by you or
the Company as provided in subsection (a) above, the number of Firm Shares
that remains unpurchased exceeds [100,000], or if the Company shall not
exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Firm Shares of a defaulting
Underwriter or Underwriters, then this Agreement shall thereupon terminate,
without liability on the part of any non-defaulting Underwriter or the
Company except for the expenses to be borne by the Company and the
Underwriters as provided in Section 5 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall
relieve a defaulting Underwriter from liability for its default.
Section 12. Default by the Company
If the Company shall fail at the Closing Time to sell and deliver the
respective aggregate number of Firm Shares that it is obligated to sell,
then this Agreement shall terminate without any liability on the part of
any non-defaulting party, except to the extent provided in Section 5 and
except that the provisions of Section 8 shall remain in effect. No action
taken pursuant to this Section shall relieve the Company from liability, if
any, in respect of its default.
Section 13. Notices
All notices and other communications under this Agreement shall be in
writing and shall be deemed to have been duly given if mailed, delivered or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed c/o ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc., ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇. ▇▇▇▇▇ Perkins, Managing
Director (with a copy sent in the same manner to Hunton & ▇▇▇▇▇▇▇▇ LLP,
Riverfront Plaza, East Tower, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.); and notices to the Company or the
Investment Adviser shall be directed to The CINTRA Select Fund, Inc., ▇▇▇▇
▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: J. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ (with a copy sent in the same manner to ▇▇▇▇▇▇▇▇ & Worcester, LLP,
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
Esq.). Each notice hereunder shall be effective upon receipt by the party
to which it is addressed.
Section 14. Parties
This Agreement is made solely for the benefit of the Underwriters, the
Investment Adviser and the Company and, to the extent so provided, the
partners, directors, officers and employees of the Underwriters and any
person controlling any of the Underwriters, the directors of the Company
and the Investment Adviser, the officers of the Company who have signed the
Registration Statement and any person controlling the Company or the
Investment Adviser, and their respective executors, administrators,
successors and assigns and, subject to the provisions of Section 11, no
other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include any
purchaser, as such purchaser, from any of the several Underwriters of the
Shares.
Section 15. Governing Law and Time
This Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York. Specified time of the day refers to
United States Eastern Time, unless otherwise specified.
Section 16. Counterparts
This Agreement may be executed in any number of counterparts and when
a counterpart has been executed by each party, all such counterparts taken
together shall constitute one and the same agreement.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof; whereupon
this instrument will become a binding agreement among the Company, the
Investment Adviser and the several Underwriters in accordance with its
terms.
Very truly yours,
THE CINTRA SELECT FUND, INC.
By: _________________________________
[Name, Title]
CINTRA FUND MANAGEMENT, LLC, as Investment Adviser:
By: _________________________________
[Name, Title]
Confirmed and accepted in Memphis, Tennessee,
as of the date first above written, as Representative
of the Underwriters named in Schedule I hereto.
▇▇▇▇▇▇ ▇▇▇▇▇▇ & COMPANY, INC.
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc.
By: _____________________________
Minor Perkins, Managing Director
SCHEDULE I
Underwriters
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc.
Advest, Inc.
BB&T Capital Markets, A division of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, Inc.
▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Company, Incorporated
Total...........................................................................