Exhibit (h)(1)
▇▇▇▇▇ ▇▇▇▇▇ Credit Opportunities Fund
[ ] Common Shares of Beneficial Interest
Par Value $0.01 Per Share
UNDERWRITING AGREEMENT
[__________], 2006
UNDERWRITING AGREEMENT
[__________], 2006
UBS Securities LLC
[Underwriters]
as Representatives
c/o UBS Securities LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
▇▇▇▇▇ ▇▇▇▇▇ Credit Opportunities Fund, a voluntary association with
transferable shares organized and existing under and by virtue of the laws of
The Commonwealth of Massachusetts (commonly referred to as a Massachusetts
business trust) (the "Fund"), proposes to issue and sell to the underwriters
named in Schedule A annexed hereto (the "Underwriters") an aggregate of [______]
common shares of beneficial interest (the "Firm Shares"), par value $0.01 per
share (the "Common Shares"), of the Fund. In addition, solely for the purpose of
covering over-allotments, the Fund proposes to grant to the Underwriters the
option to purchase from the Fund up to an additional [______] Common Shares (the
"Additional Shares"). The Firm Shares and the Additional Shares are hereinafter
collectively sometimes referred to as the "Shares." The Shares are described in
the Prospectus which is defined below.
The Fund has filed, in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(collectively called the "Securities Act"), and with the provisions of the
Investment Company Act of 1940, as amended, and the rules and regulations
thereunder (collectively called the "Investment Company Act"), with the
Securities and Exchange Commission (the "Commission") a registration statement
on Form N-2 (File Nos. 333-128887 and 811-21820), including a prospectus and a
statement of additional information, relating to the Shares. The Fund has
furnished to the Representatives, for use by the Underwriters and by dealers,
copies of one or more preliminary prospectuses (including a preliminary
statement of additional information) (each thereof, including such preliminary
statement of additional information, being herein called a "Preliminary
Prospectus") relating to the Shares. Except where the context otherwise
requires, the registration statement, as amended when it becomes effective (the
"Effective Date"), including all documents filed as a part thereof or
incorporated by reference therein, and including any information contained in a
prospectus subsequently filed with the Commission pursuant to Rule 497 under the
Securities Act and deemed to be part of the registration statement at the time
of effectiveness pursuant to Rule 430A under the Securities Act is herein called
the "Registration Statement," and the prospectus (including the statement of
additional
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information), in the form filed by the Fund with the Commission pursuant to Rule
497 under the Securities Act or, if no such filing is required, the form of
final prospectus (including the form of final statement of additional
information) included in the Registration Statement at the time it became
effective, is herein called the "Prospectus." In addition, the Fund has filed a
Notification of Registration on Form N-8A (the "Notification") pursuant to
Section 8 of the Investment Company Act. UBS Securities LLC ("UBS Securities" or
the "Managing Representative") will act as managing representative for the
Underwriters.
▇▇▇▇▇ ▇▇▇▇▇ Management, a Massachusetts business trust ("▇▇▇▇▇ ▇▇▇▇▇" or the
"Investment Adviser") will act as the Fund's investment adviser pursuant to an
Investment Advisory Agreement by and between the Fund and the Investment
Adviser, dated as of [________], 2006 (the "Investment Advisory Agreement").
Investors Bank & Trust Company will act as the custodian (the "Custodian") of
the Fund's cash and portfolio assets pursuant to a Custodian Agreement, dated as
of [________], 2006 (the "Custodian Agreement"). PFPC Inc. will act as the
Fund's transfer agent, registrar, and dividend disbursing agent (the "Transfer
Agent") pursuant to a Transfer Agency Services Agreement, dated as of
[________], 2006 (the "Transfer Agency Agreement"). ▇▇▇▇▇ ▇▇▇▇▇ will act as the
administrator of the Fund pursuant to an Administration Agreement, dated as of
[________], 2006 (the "Administration Agreement"). The Investment Adviser and
UBS Securities LLC have entered into a [Structuring Fee Agreement] dated
[__________], 2006 (the "[Structuring Fee Agreement]"). The Investment Adviser
has also entered into an Additional Compensation Agreement with
[__________________], dated [________], 2006 (the "Additional Compensation
Agreement"). In addition, the Fund has adopted a dividend reinvestment plan (the
"Dividend Reinvestment Plan") pursuant to which holders of Shares may have their
dividends automatically reinvested in additional Common Shares of the Fund if so
elected.
The Fund, the Investment Adviser and the Underwriters agree as
follows:
1. SALE AND PURCHASE. Upon the basis of the warranties and representations and
subject to the terms and conditions herein set forth, the Fund agrees to
sell to the respective Underwriters and each of the Underwriters, severally
and not jointly, agrees to purchase from the Fund the aggregate number of
Firm Shares set forth opposite the name of such Underwriter in Schedule A
attached hereto in each case at a purchase price of $19.10 per Share. The
Fund is advised that the Underwriters intend (i) to make a public offering
of their respective portions of the Firm Shares as soon after the effective
date of the Registration Statement as is advisable and (ii) initially to
offer the Firm Shares upon the terms set forth in the Prospectus. The
Underwriters may from time to time increase or decrease the public offering
price after the initial public offering to such extent as they may
determine.
In addition, the Fund hereby grants to the several Underwriters the
option to purchase, and upon the basis of the warranties and
representations and subject to the terms and conditions herein set forth,
the Underwriters shall have the right to purchase, severally and not
jointly, from the Fund, ratably in accordance with
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the number of Firm Shares to be purchased by each of them, all or a portion
of the Additional Shares as may be necessary to cover over-allotments made
in connection with the offering of the Firm Shares, at the same purchase
price per Share to be paid by the Underwriters to the Fund for the Firm
Shares. This option may be exercised by the Representatives on behalf of
the several Underwriters at any time and from time to time on or before the
forty-fifth day following the date hereof, by written notice to the Fund.
Such notice shall set forth the aggregate number of Additional Shares as to
which the option is being exercised, and the date and time when the
Additional Shares are to be delivered (such date and time being herein
referred to as the "Additional Time of Purchase"); provided, however, that
the Additional Time of Purchase shall not be earlier than the Time of
Purchase (as defined below) nor earlier than the second business day after
the date on which the option shall have been exercised. The number of
Additional Shares to be sold to each Underwriter shall be the number which
bears the same proportion to the aggregate number of Additional Shares
being purchased as the number of Firm Shares set forth opposite the name of
such Underwriter on Schedule A hereto bears to the total number of Firm
Shares (subject, in each case, to such adjustment as the Representatives
may determine to eliminate fractional shares).
2. PAYMENT AND DELIVERY. Payment of the purchase price for the Firm Shares
shall be made by the Underwriters to the Fund by Federal Funds wire
transfer, against delivery of the certificates for the Firm Shares to the
Representatives through the facilities of the Depository Trust Company for
the respective accounts of the Underwriters. Such payment and delivery
shall be made at a time mutually agreed upon by the parties on the third
business day following the date of this Underwriting Agreement (unless
another date shall be agreed to by the Representatives and the Fund). The
time at which such payment and delivery are actually made is hereinafter
sometimes called the Time of Purchase. Certificates for the Firm Shares
shall be delivered to the Representatives in definitive form in such names
and in such denominations as the Representatives shall specify on the
second business day preceding the Time of Purchase. For the purpose of
expediting the checking of the certificates for the Firm Shares by the
Representatives, the Fund agrees to make such certificates available to the
Representatives for such purpose at least one full business day preceding
the Time of Purchase.
Payment of the purchase price for the Additional Shares shall be made
at the Additional Time of Purchase in the same manner and at the same
office as the payment for the Firm Shares. Certificates for the Additional
Shares shall be delivered to the Representatives in definitive form in such
names and in such denominations as the Representatives shall specify no
later than the second business day preceding the Additional Time of
Purchase. For the purpose of expediting the checking of the certificates
for the Additional Shares by the Representatives, the Fund agrees to make
such certificates available to the Representatives for such purpose at
least one full business day preceding the
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Additional Time of Purchase. The Time of Purchase and the Additional Time
of Purchase are sometimes referred to herein as the Closing Dates.
3. REPRESENTATIONS AND WARRANTIES OF THE FUND AND THE INVESTMENT ADVISER. Each
of the Fund and the Investment Adviser jointly and severally represents and
warrants to each Underwriter as follows:
(a) On (i) the Effective Date and the date on which the Prospectus is
first filed with the Commission pursuant to Rule 497(b), (h) or (j)
under the Securities Act, as the case may be, (ii) the date on which
any post-effective amendment to the Registration Statement (except any
post-effective amendment which is filed with the Commission after the
later of (x) one year from the date of this Underwriting Agreement or
(y) the date on which the distribution of the Shares is completed)
became or becomes effective or any amendment or supplement to the
Prospectus was or is filed with the Commission and (iii) the Closing
Dates, the Registration Statement, the Prospectus and any such
amendment or supplement thereto and the Notification complied or will
comply in all material respects with the requirements of the
Securities Act and the Investment Company Act, as the case may be. On
the Effective Date and on the date that any post-effective amendment
to the Registration Statement (except any post-effective amendment
which is filed with the Commission after the later of (x) one year
from the date of this Underwriting Agreement or (y) the date on which
the distribution of the Shares is completed) became or becomes
effective, neither the Registration Statement nor any such amendment
did or will contain any untrue statement of a material fact or omit to
state a material fact required to be stated in it or necessary to make
the statements in it not misleading. Except as permitted under Rule
430 under the Securities Act (and other applicable rules under
Regulation C under the Securities Act), the Preliminary Prospectus
dated [______], 2006 did not, as of such date, contain any untrue
statement of a material fact or omit to state a material fact required
to be stated in it or necessary to make the statements in it, in light
of the circumstances under which they were made, not misleading. At
the Effective Date and, if applicable, the date the Prospectus or any
amendment or supplement to the Prospectus was or is filed with the
Commission and at the Closing Dates, the Prospectus did not or will
not, as the case may be, contain any untrue statement of a material
fact or omit to state a material fact required to be stated in it or
necessary to make the statements in it, in light of the circumstances
under which they were made, not misleading. The foregoing
representations in this Section 3(a) do not apply to statements or
omissions relating to the Underwriters made in reliance on and in
conformity with information furnished in writing to the Fund by the
Underwriters expressly for use in the Registration Statement, the
Prospectus, or any amendments or supplements thereto, as described in
Section 9(f) hereof.
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(b) The Fund has been duly formed, is validly existing a business trust
under the laws of the Commonwealth of Massachusetts, with full power
and authority to conduct all the activities conducted by it, to own or
lease all assets owned or leased by it and to conduct its business as
described in the Registration Statement and Prospectus, and the Fund
is duly licensed and qualified to do business and in good standing in
each jurisdiction in which its ownership or leasing of property or its
conducting of business requires such qualification, except where the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Fund, and the Fund owns, possesses or
has obtained and currently maintains all governmental licenses,
permits, consents, orders, approvals and other authorizations, whether
foreign or domestic, necessary to carry on its business as
contemplated in the Prospectus. The Fund has no subsidiaries.
(c) The capitalization of the Fund is as set forth in the Registration
Statement and the Prospectus. The Common Shares conform in all
material respects to the description of them in the Prospectus. All
the outstanding Common Shares have been duly authorized and are
validly issued, fully paid and nonassessable (except as described in
the Registration Statement). The Shares to be issued and delivered to
and paid for by the Underwriters in accordance with this Underwriting
Agreement against payment therefor as provided by this Underwriting
Agreement have been duly authorized and when issued and delivered to
the Underwriters will have been validly issued and will be fully paid
and nonassessable (except as described in the Registration Statement).
No person is entitled to any preemptive or other similar rights with
respect to the Shares.
(d) The Fund is duly registered with the Commission under the Investment
Company Act as a diversified, closed-end management investment
company, and, subject to the filing of any final amendment to the
Registration Statement (a "Final Amendment"), if not already filed,
all action under the Securities Act and the Investment Company Act, as
the case may be, necessary to make the public offering and consummate
the sale of the Shares as provided in this Underwriting Agreement has
or will have been taken by the Fund.
(e) The Fund has full power and authority to enter into each of this
Underwriting Agreement, the Investment Advisory Agreement, the
Custodian Agreement, the Transfer Agency Agreement, the Administration
Agreement, and the Dividend Reinvestment Plan (collectively, the "Fund
Agreements") and to perform all of the terms and provisions hereof and
thereof to be carried out by it and (i) each Fund Agreement has been
duly and validly authorized, executed and delivered by or on behalf of
the Fund, (ii) each Fund Agreement does not violate in any material
respect any of the applicable provisions of the Investment Company Act
or the Investment Advisers Act of 1940, as amended, and the rules and
regulations thereunder (collectively called the "Advisers
6
Act"), as the case may be, and (iii) assuming due authorization,
execution and delivery by the other parties thereto, each Fund
Agreement constitutes the legal, valid and binding obligation of the
Fund enforceable in accordance with its terms, (A) subject, as to
enforcement, to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally and to general equitable
principles (regardless of whether enforcement is sought in a
proceeding in equity or at law) and (B) except as rights to indemnity
thereunder may be limited by federal or state securities laws.
(f) None of (i) the execution and delivery by the Fund of the Fund
Agreements, (ii) the issue and sale by the Fund of the Shares as
contemplated by this Underwriting Agreement and (iii) the performance
by the Fund of its obligations under any of the Fund Agreements or
consummation by the Fund of the other transactions contemplated by the
Fund Agreements conflicts with or will conflict with, or results or
will result in a breach of, the Declaration of Trust or the By-laws of
the Fund or any agreement or instrument to which the Fund is a party
or by which the Fund is bound, or any law, rule or regulation, or
order of any court, governmental instrumentality, securities exchange
or association or arbitrator, whether foreign or domestic, applicable
to the Fund, other than state securities or "blue sky" laws applicable
in connection with the purchase and distribution of the Shares by the
Underwriters pursuant to this Underwriting Agreement.
(g) The Fund is not currently in breach of, or in default under, any
written agreement or instrument to which it is a party or by which it
or its property is bound or affected.
(h) No person has any right to the registration of any securities of the
Fund because of the filing of the registration statement.
(i) No consent, approval, authorization or order of any court or
governmental agency or body or securities exchange or association,
whether foreign or domestic, is required by the Fund for the
consummation by the Fund of the transactions to be performed by the
Fund or the performance by the Fund of all the terms and provisions to
be performed by or on behalf of it in each case as contemplated in the
Fund Agreements, except such as (i) have been obtained under the
Securities Act, the Investment Company Act, or the Advisers Act, and
(ii) may be required by the New York Stock Exchange or under state
securities or "blue sky" laws, in connection with the purchase and
distribution of the Shares by the Underwriters pursuant to this
Underwriting Agreement.
(j) The Shares are duly authorized for listing, subject to official notice
of issuance, on the New York Stock Exchange and the Fund's
Registration Statement on Form 8-A, under the Securities Exchange Act
of 1934, as
7
amended, and the rules and regulations thereunder (collectively called
the "Exchange Act"), has become effective.
(k) Deloitte & Touche LLP, whose report appears in the Prospectus, are
independent public auditors with respect to the Fund as required by
the Securities Act and the Investment Company Act.
(l) The statement of assets and liabilities included in the Registration
Statement and the Prospectus presents fairly in all material respects,
in accordance with generally accepted accounting principles in the
United States applied on a consistent basis, the financial position of
the Fund as of the date indicated.
(m) The Fund will maintain a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for
assets; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with existing assets through an
asset reconciliation procedure or otherwise at reasonable intervals
and appropriate action is taken with respect to any differences.
(n) Since the date as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein, (i)
there has been no material adverse change in the condition, financial
or otherwise, business prospects, properties, net assets or results of
operations of the Fund, whether or not arising in the ordinary course
of business, (ii) there have been no transactions entered into by the
Fund other than those in the ordinary course of its business and (iii)
there has been no dividend or distribution of any kind declared, paid
or made on any class of its capital shares.
(o) There is no action, suit or proceeding before or by any court,
commission, regulatory body, administrative agency or other
governmental agency or body, foreign or domestic, now pending, or, to
the knowledge of the Fund, threatened against or affecting the Fund,
which (i) might result in any material adverse change in the
condition, financial or otherwise, business affairs or business
prospects of the Fund or might materially adversely affect the
properties or assets of the Fund or (ii) is of a character required to
be described in the Registration Statement or the Prospectus; and
there are no contracts, franchises or other documents that are of a
character required to be described in, or that are required to be
filed as exhibits to, the Registration Statement that have not been
described or filed as required.
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(p) Except for stabilization transactions conducted by the Underwriters,
and except for tender offers, Share repurchases and the issuance or
purchase of Shares pursuant to the Fund's Dividend Reinvestment Plan
effected following the date on which the distribution of the Shares is
completed in accordance with the policies of the Fund as set forth in
the Prospectus, the Fund has not taken and will not take, directly or
indirectly, any action designed or which might be reasonably expected
to cause or result in, or which will constitute, stabilization or
manipulation of the price of the Common Shares in violation of
applicable federal securities laws.
(q) The Fund intends to direct the investment of the proceeds of the
offering of the Shares in such a manner as to comply with the
requirements of Subchapter M of the Internal Revenue Code of 1986, as
amended (the "Code").
(r) To the knowledge of the Fund after due inquiry, no advertising, sales
literature or other promotional materials (excluding road show slides
or road show tapes) were authorized or prepared by or on behalf of the
Fund or the Investment Adviser or any representative thereof for use
in connection with the public offering or sale of the Shares other
than the definitive client brochure and the broker selling memo which
were filed with the NASD on [______], 2006, a draft prospecting letter
which was filed with the NASD on [______], 2006, a draft of a
prospecting letter made available on a password-protected Internet web
site maintained by the Investment Adviser and a road show tape made
available for broker use on an Intranet web site maintained by the
Investment Adviser (collectively, the "sales materials"); the sales
materials and any road show slides or road show tapes complied and
comply in all material respects with the applicable requirements of
the Securities Act and the rules and interpretations of the NASD; and
no broker kits, road show slides, road show tapes or sales materials
authorized or prepared by the Fund or authorized or prepared on behalf
of the Fund by the Investment Adviser or any representative thereof
for use in connection with the public offering or sale of the Shares
contained or contains any untrue statement of a material fact or
omitted or omits to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading.
In addition, any certificate signed by any officer of the Fund and
delivered to the Underwriters or counsel for the Underwriters in connection
with the offering of the Share shall be deemed to be a representation and
warranty by the Fund as to matters covered thereby, to each Underwriter
4. REPRESENTATIONS AND WARRANTIES OF THE INVESTMENT ADVISER. The Investment
Adviser represents to each Underwriter as follows:
9
(a) The Investment Adviser has been duly formed, is validly existing as a
business trust under the laws of the Commonwealth of Massachusetts, in
the case of the Investment Adviser with full power and authority to
conduct all of the activities conducted by it, to own or lease all of
the assets owned or leased by it and to conduct its business as
described in the Registration Statement and Prospectus, and the
Investment Adviser is duly licensed and qualified to do business and
in good standing in each jurisdiction in which it is required to be so
qualified, except to the extent that failure to be so qualified or be
in good standing would not have a material adverse affect on the
Investment Adviser's ability to provide services to the Fund; and the
Investment Adviser owns, possesses or has obtained and currently
maintains all governmental licenses, permits, consents, orders,
approvals and other authorizations, whether foreign or domestic,
necessary to carry on its business as contemplated in the Registration
Statement and the Prospectus.
(b) The Investment Adviser is (i) duly registered as an investment adviser
under the Advisers Act and (ii) not prohibited by the Advisers Act or
the Investment Company Act from acting as the investment adviser for
the Fund as contemplated by the Investment Advisory Agreement, the
Registration Statement and the Prospectus.
(c) The Investment Adviser has full power and authority to enter into each
of this Underwriting Agreement, the Investment Advisory Agreement, the
Administration Agreement, the [Structuring Fee Agreement], and the
Additional Compensation Agreement, to which the Investment Adviser is
a party (collectively, the "Adviser Agreements"), and to carry out all
the terms and provisions hereof and thereof to be carried out by it;
and each Adviser Agreement has been duly and validly authorized,
executed and delivered by the Investment Adviser; none of the Adviser
Agreements violate in any material respect any of the applicable
provisions of the Investment Company Act or the Advisers Act; and
assuming due authorization, execution and delivery by the other
parties thereto, each Adviser Agreement constitutes a legal, valid and
binding obligation of the Investment Adviser, enforceable in
accordance with its terms, (i) subject, as to enforcement, to
applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and to general equitable principles
(regardless of whether enforcement is sought in a proceeding in equity
or at law) and (ii) except as rights to indemnity thereunder may be
limited by federal or state securities laws.
(d) Neither (i) the execution and delivery by the Investment Adviser of
any Adviser Agreement nor (ii) the consummation by the Investment
Adviser of the transactions contemplated by, or the performance of its
obligations under any Adviser Agreement conflicts or will conflict
with, or results or will result in a breach of, the Declaration of
Trust or By-Laws of the Investment Adviser or any agreement or
instrument to which the
10
Investment Adviser is a party or by which the Investment Adviser is
bound, or any law, rule or regulation, or order of any court,
governmental instrumentality, securities exchange or association or
arbitrator, whether foreign or domestic, applicable to the Investment
Adviser.
(e) No consent, approval, authorization or order of any court,
governmental agency or body or securities exchange or association,
whether foreign or domestic, is required for the consummation of the
transactions contemplated in, or the performance by the Investment
Adviser of its obligations under, any Adviser Agreement, as the case
may be, except such as (i) have been obtained under the Securities
Act, the Investment Company Act, or the Advisers Act, and (ii) may be
required by the New York Stock Exchange or under state securities or
"blue sky" laws, in connection with the purchase and distribution of
the Shares by the Underwriters pursuant to this Underwriting
Agreement.
(f) The description of the Investment Adviser and its business and the
statements attributable to the Investment Adviser in the Registration
Statement and the Prospectus comply with the requirements of the
Securities Act and the Investment Company Act and do not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein not misleading.
(g) Except as disclosed, there is no action, suit or proceeding before or
by any court, commission, regulatory body, administrative agency or
other governmental agency or body, foreign or domestic, now pending
or, to the knowledge of the Investment Adviser, threatened against or
affecting the Investment Adviser of a nature required to be disclosed
in the Registration Statement or Prospectus or that might reasonably
be expected to result in any material adverse change in the condition,
financial or otherwise, business affairs or business prospects of the
Investment Adviser or the ability of the Investment Adviser to fulfill
its obligations under any Adviser Agreement.
(h) Except for stabilization activities conducted by the Underwriters and
except for tender offers, Share repurchases and the issuance or
purchase of Shares pursuant to the Fund's Dividend Reinvestment Plan
effected following the date on which the distribution of the Shares is
completed in accordance with the policies of the Fund as set forth in
the Prospectus, the Investment Adviser has not taken and will not
take, directly or indirectly, any action designed, or which might
reasonably be expected to cause or result in, or which will
constitute, stabilization or manipulation of the price of the Common
Shares in violation of applicable federal securities laws.
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In the event that the Fund or the Investment Adviser makes available
any promotional materials (other than the sales materials) intended
for use only by qualified broker-dealers and registered
representatives thereof by means of an Internet web site or similar
electronic means, the Investment Adviser will install and maintain
pre-qualification and password-protection or similar procedures which
will effectively prohibit access to such promotional materials by
persons other than qualified broker-dealers and registered
representatives thereof.
In addition, any certificate signed by any officer of the Investment
Adviser and delivered to the Underwriters or counsel for the Underwriters
in connection with the offering of the Shares shall be deemed to be a
representation and warranty by the Investment Adviser, as to matters
covered thereby, to each Underwriter.
5. AGREEMENTS OF THE PARTIES.
(a) If the registration statement relating to the Shares has not yet become
effective, the Fund will promptly file a Final Amendment, if not previously
filed, with the Commission, and will use its best efforts to cause such
registration statement to become effective and, as soon as the Fund is
advised, will advise the Managing Representative when the Registration
Statement or any amendment thereto has become effective. If the
Registration Statement has become effective and the Prospectus contained
therein omits certain information at the time of effectiveness pursuant to
Rule 430A under the Securities Act, the Fund will file a 430A Prospectus
pursuant to Rule 497(h) under the Securities Act as promptly as
practicable, but no later than the second business day following the
earlier of the date of the determination of the offering price of the
Shares or the date the Prospectus is first used after the Effective Date.
If the Registration Statement has become effective and the Prospectus
contained therein does not so omit such information, the Fund will file a
Prospectus pursuant to Rule 497(b) or a certification pursuant to Rule
497(j) under the Securities Act as promptly as practicable, but no later
than the fifth business day following the date of the later of the
Effective Date or the commencement of the public offering of the Shares
after the Effective Date. In either case, the Fund will provide the
Managing Representative satisfactory evidence of the filing. The Fund will
not file with the Commission any Prospectus or any other amendment (except
any post-effective amendment which is filed with the Commission after the
later of (x) one year from the date of this Underwriting Agreement or (y)
the date on which distribution of the Shares is completed) or supplement to
the Registration Statement or the Prospectus unless a copy has first been
submitted to the Managing Representative a reasonable time before its
filing and the Managing Representative has not objected to it in writing
within a reasonable time after receiving the copy.
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(b) For the period of three years from the date hereof, the Fund will
advise the Managing Representative promptly (i) of the issuance by the
Commission of any order in respect of the Fund or the Investment
Adviser, which relates to the Fund, or which relates to any material
arrangements or proposed material arrangements involving the Fund or
the Investment Adviser, (ii) of the initiation or threatening of any
proceedings for, or receipt by the Fund of any notice with respect to,
any suspension of the qualification of the Shares for sale in any
jurisdiction or the issuance of any order by the Commission suspending
the effectiveness of the Registration Statement, (iii) of receipt by
the Fund, or any representative or attorney of the Fund, of any other
communication from the Commission relating in any material way to the
Fund, the Registration Statement, the Notification, any Preliminary
Prospectus, the Prospectus or to the transactions contemplated by this
Underwriting Agreement and (iv) the issuance by any court, regulatory
body, administrative agency or other governmental agency or body,
whether foreign or domestic, of any order, ruling or decree, or the
threat to initiate any proceedings with respect thereto, regarding the
Fund, which relates in any material way to the Fund or any material
arrangements or proposed material arrangements involving the Fund. The
Fund will make every reasonable effort to prevent the issuance of any
order suspending the effectiveness of the Registration Statement and,
if any such order is issued, to obtain its lifting as soon as
possible.
(c) If not delivered prior to the date of this Underwriting Agreement, the
Fund will deliver to the Managing Representative, without charge, a
signed copy of the Registration Statement and the Notification and of
any amendments (except any post-effective amendment which is filed
with the Commission after the later of (x) one year from the date of
this Underwriting Agreement or (y) the date on which the distribution
of the Shares is completed) to either the Registration Statement or
the Notification (including all exhibits filed with any such document)
and as many conformed copies of the Registration Statement and any
amendments thereto (except any post-effective amendment which is filed
with the Commission after the later of (x) one year from the date of
this Underwriting Agreement or (y) the date on which the distribution
of the Shares is completed) (excluding exhibits) as the Managing
Representative may reasonably request.
(d) During such period as a prospectus is required by law to be delivered
by an underwriter or a dealer, the Fund will deliver, without charge,
to the Representatives, the Underwriters and any dealers, at such
office or offices as the Representatives may designate, as many copies
of the Prospectus as the Representatives may reasonably request, and,
if any event occurs during such period as a result of which it is
necessary to amend or supplement the Prospectus, in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading in
13
any material respect, or if during such period it is necessary to
amend or supplement the Prospectus to comply with the Securities Act
or the Investment Company Act, the Fund promptly will prepare, submit
to the Managing Representative, file with the Commission and deliver,
without charge, to the Underwriters and to dealers (whose names and
addresses the Managing Representative will furnish to the Fund) to
whom Shares may have been sold by the Underwriters, and to other
dealers on request, amendments or supplements to the Prospectus so
that the statements in such Prospectus, as so amended or supplemented,
will not, in light of the circumstances under which they were made, be
misleading in any material respect and will comply with the Securities
Act and the Investment Company Act. Delivery by the Underwriters of
any such amendments or supplements to the Prospectus will not
constitute a waiver of any of the conditions in Section 6 hereof.
(e) The Fund will make generally available to holders of the Fund's
securities, as soon as practicable but in no event later than the last
day of the 18th full calendar month following the calendar quarter in
which the Effective Date falls, an earnings statement, if applicable,
satisfying the provisions of the last paragraph of Section 11(a) of
the Securities Act and, at the option of the Fund, Rule 158 under the
Securities Act.
(f) If the transactions contemplated by this Underwriting Agreement are
consummated, the Fund shall pay all costs and expenses incident to the
performance of the obligations of the Fund under this Underwriting
Agreement (to the extent such expenses do not, in the aggregate,
exceed $0.04 per Share), including but not limited to costs and
expenses of or relating to (i) the preparation, printing and filing of
the Registration Statement and exhibits to it, each Preliminary
Prospectus, the Prospectus and all amendments and supplements thereto,
(ii) the issuance of the Shares and the preparation and delivery of
certificates for the Shares, (iii) the registration or qualification
of the Shares for offer and sale under the securities or "blue sky"
laws of the jurisdictions referred to in the foregoing paragraph,
including the fees and disbursements of counsel for the Underwriters
in that connection, and the preparation and printing of any
preliminary and supplemental "blue sky" memoranda, (iv) the furnishing
(including costs of design, production, shipping and mailing) to the
Underwriters and dealers of copies of each Preliminary Prospectus
relating to the Shares, the sales materials, the Prospectus, and all
amendments or supplements to the Prospectus, and of the other
documents required by this Section to be so furnished, (v) the filing
requirements of the NASD, in connection with its review of the
financing, including filing fees paid by counsel for the Underwriters
in that connection, (vi) all transfer taxes, if any, with respect to
the sale and delivery of the Shares to the Underwriters, (vii) the
listing of the Shares on the New York Stock Exchange and (viii) the
transfer agent for the Shares. To the extent the foregoing costs and
expenses incident to the performance of the
14
obligations of the Fund under this Underwriting Agreement exceed, in
the aggregate, $0.04 per Share, ▇▇▇▇▇ ▇▇▇▇▇ or an affiliate will pay
all such excess costs and expenses. The Fund and the Investment
Adviser may otherwise agree among themselves as to the payment of the
foregoing expenses, whether or not the transactions contemplated by
this Underwriting Agreement are consummated, provided, however, that
in no event shall the Underwriters be obligated to pay any of the
foregoing expenses.
(g) If the transactions contemplated by this Underwriting Agreement are
not consummated, except as otherwise provided herein, no party will be
under any liability to any other party, except that (i) if this
Underwriting Agreement is terminated by (x) the Fund or the Investment
Adviser pursuant to any of the provisions hereof or (y) by the
Representatives or the Underwriters because of any inability, failure
or refusal on the part of the Fund or the Investment Adviser to comply
with any material terms or because any of the conditions in Section 6
are not satisfied, the Investment Adviser or the Investment's
Adviser's affiliates and the Fund, jointly and severally, will
reimburse the Underwriters for all out-of-pocket expenses (including
the reasonable fees, disbursements and other charges of their counsel)
reasonably incurred by them in connection with the proposed purchase
and sale of the Shares and (ii) no Underwriter who has failed or
refused to purchase the Shares agreed to be purchased by it under this
Underwriting Agreement, in breach of its obligations pursuant to this
Underwriting Agreement, will be relieved of liability to the Fund, the
Investment Adviser and the other Underwriters for damages occasioned
by its default.
(h) Without the prior written consent of the Managing Representative, the
Fund will not offer, sell or register with the Commission, or announce
an offering of, any equity securities of the Fund, within 180 days
after the Effective Date, except for the Shares as described in the
Prospectus and any issuances of Common Shares pursuant to the Dividend
Reinvestment Plan and except in connection with any offering of
preferred shares of beneficial interest as contemplated by the
Prospectus.
(i) The Fund will use its best efforts to list the Shares on the New York
Stock Exchange prior to the date the Shares are issued and comply with
the rules and regulations of such exchange.
(j) The Fund will direct the investment of the net proceeds of the
offering of the Shares in such a manner as to comply with the
investment objective and policies of the Fund as described in the
Prospectus.
6. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The obligations of the
Underwriters to purchase the Shares are subject to the accuracy on the date
of this Underwriting Agreement, and on each of the Closing Dates, of the
representations
15
of the Fund and the Investment Adviser in this Underwriting Agreement, to
the accuracy and completeness of all material statements made by the Fund
or the Investment Adviser or any of their respective officers in any
certificate delivered to the Managing Representative or its counsel
pursuant to this Underwriting Agreement, to performance by the Fund and the
Investment Adviser of their respective obligations under this Underwriting
Agreement and to each of the following additional conditions:
(a) The Registration Statement must have become effective by 5:30 p.m.,
New York City time, on the date of this Underwriting Agreement or such
later date and time as the Managing Representative consents to in
writing. The Prospectus must have been filed in accordance with Rule
497(b) or (h) or a certificate must have been filed in accordance with
Rule 497(j), as the case may be, under the Securities Act.
(b) No order suspending the effectiveness of the Registration Statement
may be in effect and no proceedings for such purpose may be pending
before or, to the knowledge of counsel to the Underwriters, threatened
by the Commission, and any requests for additional information on the
part of the Commission (to be included in the Registration Statement
or the Prospectus or otherwise) must be complied with or waived to the
reasonable satisfaction of the Managing Representative.
(c) Since the dates as of which information is given in the Registration
Statement and the Prospectus, as of the date of this Underwriting
Agreement, (i) there must not have been any material change in the
Common Shares or liabilities of the Fund except as set forth in or
contemplated by the Prospectus; (ii) there must not have been any
material adverse change in the general affairs, prospects, management,
business, financial condition or results of operations of the Fund or
the Investment Adviser whether or not arising from transactions in the
ordinary course of business as set forth in or contemplated by the
Prospectus; (iii) the Fund must not have sustained any material loss
or interference with its business from any court or from legislative
or other governmental action, order or decree, whether foreign or
domestic, or from any other occurrence not described in the
Registration Statement and Prospectus; and (iv) there must not have
occurred any event that makes untrue or incorrect in any material
respect any statement or information contained in the Registration
Statement or Prospectus or that is not reflected in the Registration
Statement or Prospectus but should be reflected therein in order to
make the statements or information therein (in the case of the
Prospectus, in light of the circumstances in which they were made) not
misleading in any material respect; if, in the judgment of the
Managing Representative, any such development referred to in clause
(i), (ii), (iii), or (iv) of this paragraph (c) makes it impracticable
or inadvisable to consummate the sale and delivery of the Shares
pursuant to this Underwriting Agreement by the Underwriters, at the
initial public offering price of the Shares.
16
(d) The Managing Representative must have received on each Closing Date a
certificate, dated such date, of the President or a Vice-President and
the chief financial or accounting officer of each of the Fund and the
Investment Adviser certifying (in their capacity as such officers and,
with respect to clauses (ii), (iii) and (vi) below, on behalf of the
Fund and the Investment Adviser, as the case may be) that (i) the
signers have carefully examined the Registration Statement, the
Prospectus, and this Underwriting Agreement, (ii) the representations
of the Fund (with respect to the certificates from such Fund officers)
and the representations of the Investment Adviser (with respect to the
certificates from such officers of the Investment Adviser) in this
Underwriting Agreement are accurate on and as of the date of the
certificate, (iii) there has not been any material adverse change in
the general affairs, prospects, management, business, financial
condition or results of operations of the Fund (with respect to the
certificates from such Fund officers) or the Investment Adviser (with
respect to the certificates from such officers of the Investment
Adviser), which change would materially and adversely affect the
ability of the Fund or the Investment Adviser, as the case may be, to
fulfill its obligations under this Underwriting Agreement or the
Investment Advisory Agreement (with respect to the certificates from
such officers of the Investment Adviser), whether or not arising from
transactions in the ordinary course of business, (iv) with respect to
the Fund only, to the knowledge of such officers after reasonable
investigation, no order suspending the effectiveness of the
Registration Statement, prohibiting the sale of any of the Shares or
otherwise having a material adverse effect on the Fund has been issued
and no proceedings for any such purpose are pending before or, to the
knowledge of such officers after reasonable investigation, threatened
by the Commission or any other regulatory body, whether foreign or
domestic, (v) no order having a material adverse effect on the ability
of the Investment Adviser to fulfill its obligations under this
Underwriting Agreement, the [Structuring Fee Agreement], the
Additional Compensation Agreement or the Investment Advisory
Agreement, as the case may be, has been issued and no proceedings for
any such purpose are pending before or, to the knowledge of the
officers of the Investment Adviser after reasonable investigation,
threatened by the Commission or any other regulatory body, whether
foreign or domestic, and (vi) each of the Fund (with respect to the
certificates from such Fund officers) and the Investment Adviser (with
respect to the certificates from such officers of the Investment
Adviser) has performed all of its respective agreements that this
Underwriting Agreement requires it to perform by such Closing Date (to
the extent not waived in writing by the Managing Representative).
(e) The Managing Representative must have received on each Closing Date
the opinions dated such Closing Date substantially in the form of
Schedules B and C to this Underwriting Agreement from the counsel
identified in each such Schedules.
17
(f) The Managing Representative must have received on each Closing Date
from Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP and its affiliated
entities an opinion dated such Closing Date with respect to the Fund,
the Shares, the Registration Statement and the Prospectus, this
Underwriting Agreement and the form and sufficiency of all proceedings
taken in connection with the sale and delivery of the Shares. Such
opinion and proceedings shall fulfill the requirements of this Section
6(f) only if such opinion and proceedings are satisfactory in all
respects to the Managing Representative. The Fund and the Investment
Adviser must have furnished to such counsel such documents as counsel
may reasonably request for the purpose of enabling them to render such
opinion.
(g) The Managing Representative must have received on the date this
Underwriting Agreement is signed and delivered by you a signed letter,
dated such date, substantially in the form of Schedule D to this
Underwriting Agreement from the firm of accountants designated in such
Schedule. The Managing Representative also must have received on each
Closing Date a signed letter from such accountants, dated as of such
Closing Date, confirming on the basis of a review in accordance with
the procedures set forth in their earlier letter that nothing has come
to their attention during the period from a date not more than five
business days before the date of this Underwriting Agreement,
specified in the letter, to a date not more than five business days
before such Closing Date, that would require any change in their
letter referred to in the foregoing sentence.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Underwriting Agreement will comply only if they are in
form and scope reasonably satisfactory to counsel for the Underwriters,
provided that any such documents, forms of which are annexed hereto, shall
be deemed satisfactory to such counsel if substantially in such form.
7. TERMINATION. This Underwriting Agreement may be terminated by the Managing
Representative by notifying the Fund at any time:
(a) before the later of the effectiveness of the Registration Statement
and the time when any of the Shares are first generally offered
pursuant to this Underwriting Agreement by the Managing Representative
to dealers by letter or telegram;
(b) at or before any Closing Date if, in the sole judgment of the Managing
Representative, payment for and delivery of any Shares is rendered
impracticable or inadvisable because (i) trading in the equity
securities of the Fund is suspended by the Commission or by the
principal exchange that lists the Shares, (ii) trading in securities
generally on the New York Stock Exchange or the Nasdaq Stock Market
shall have been suspended or limited or minimum or maximum prices
shall have been generally
18
established on such exchange or over-the-counter market, (iii)
additional material governmental restrictions, not in force on the
date of this Underwriting Agreement, have been imposed upon trading in
securities or trading has been suspended on any U.S. securities
exchange, (iv) a general banking moratorium has been established by
U.S. federal or New York authorities or (v) any material adverse
change in the financial or securities markets in the United States or
in political, financial or economic conditions in the United States or
any outbreak or material escalation of hostilities or declaration by
the United States of a national emergency or war or other calamity,
terrorist activity or crisis shall have occurred the effect of any of
which is such as to make it, in the sole judgment of the Managing
Representative, impracticable or inadvisable to market the Shares on
the terms and in the manner contemplated by the Prospectus; or
(c) at or before any Closing Date, if any of the conditions specified in
Section 6 have not been fulfilled when and as required by this
Underwriting Agreement.
8. SUBSTITUTION OF UNDERWRITERS. If one or more of the Underwriters fails
(other than for a reason sufficient to justify the termination of this
Underwriting Agreement) to purchase on any Closing Date the Shares agreed
to be purchased on such Closing Date by such Underwriter or Underwriters,
the Managing Representative may find one or more substitute underwriters to
purchase such Shares or make such other arrangements as the Managing
Representative deems advisable, or one or more of the remaining
Underwriters may agree to purchase such Shares in such proportions as may
be approved by the Managing Representative, in each case upon the terms set
forth in this Underwriting Agreement. If no such arrangements have been
made within 36 hours after such Closing Date, and
(a) the number of Shares to be purchased by the defaulting Underwriters on
such Closing Date does not exceed 10% of the Shares that the
Underwriters are obligated to purchase on such Closing Date, each of
the nondefaulting Underwriters will be obligated to purchase such
Shares on the terms set forth in this Underwriting Agreement in
proportion to their respective obligations under this Underwriting
Agreement, or
(b) the number of Shares to be purchased by the defaulting Underwriters on
such Closing Date exceeds 10% of the Shares to be purchased by all the
Underwriters on such Closing Date, the Fund will be entitled to an
additional period of 24 hours within which to find one or more
substitute underwriters reasonably satisfactory to the Managing
Representative to purchase such Shares on the terms set forth in this
Underwriting Agreement.
Upon the occurrence of the circumstances described in the foregoing
paragraph (b), either the Managing Representative or the Fund will have the
right
19
to postpone the applicable Closing Date for not more than five business
days in order that necessary changes and arrangements (including any
necessary amendments or supplements to the Registration Statement or the
Prospectus) may be effected by the Managing Representative and the Fund. If
the number of Shares to be purchased on such Closing Date by such
defaulting Underwriter or Underwriters exceeds 10% of the Shares that the
Underwriters are obligated to purchase on such Closing Date, and none of
the nondefaulting Underwriters or the Fund makes arrangements pursuant to
this Section within the period stated for the purchase of the Shares that
the defaulting Underwriters agreed to purchase, this Underwriting Agreement
will terminate without liability on the part of any nondefaulting
Underwriter, the Fund or the Investment Adviser except as provided in
Sections 5(g) and 9 hereof. Any action taken under this Section will not
affect the liability of any defaulting Underwriter to the Fund or the
Investment Adviser or to any nondefaulting Underwriters arising out of such
default. A substitute underwriter will become an Underwriter for all
purposes of this Underwriting Agreement.
9. INDEMNITY AND CONTRIBUTION.
(a) Each of the Fund and the Investment Adviser, jointly and severally,
agrees to indemnify, defend and hold harmless each Underwriter, its
partners, directors and officers, and any person who controls any
Underwriter within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, and their successors and assigns of
all of the foregoing persons from and against any loss, damage,
expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, any such Underwriter or
any such person may incur under the Securities Act, the Exchange Act,
the Investment Company Act, the Advisers Act, the common law or
otherwise, insofar as such loss, damage, expense, liability or claim
arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement
(or in the Registration Statement as amended by any post-effective
amendment thereof by the Fund) or in a Prospectus (the term
"Prospectus" for the purpose of this Section 9 being deemed to include
any Preliminary Prospectus, the sales materials, the Prospectus and
the Prospectus as amended or supplemented by the Fund), or arises out
of or is based upon any omission or alleged omission to state a
material fact required to be stated in either such Registration
Statement or Prospectus or necessary to make the statements made
therein (with respect to the Prospectus, in light of the circumstances
under which they were made) not misleading, except insofar as any such
loss, damage, expense, liability or claim arises out of or is based
upon any untrue statement or alleged untrue statement of a material
fact contained in and in conformity with information furnished in
writing by or on behalf of any Underwriter to the Fund or the
Investment Adviser expressly for use with reference to any
20
Underwriter in such Registration Statement or such Prospectus or
arises out of or is based upon any omission or alleged omission to
state a material fact in connection with such information required to
be stated in such Registration Statement or such Prospectus or
necessary to make such information (with respect to the Prospectus, in
light of the circumstances under which they were made) not misleading,
provided, however, that the indemnity agreement contained in this
subsection (a) with respect to any Preliminary Prospectus or amended
Preliminary Prospectus shall not inure to the benefit of any
Underwriter (or to the benefit of any person controlling such
Underwriter) from whom the person asserting any such loss, damage,
expense, liability or claim purchased the Shares which is the subject
thereof if the Prospectus corrected any such alleged untrue statement
or omission and if such Underwriter failed to send or give a copy of
the Prospectus to such person at or prior to the written confirmation
of the sale of such Shares to such person, unless the failure is the
result of noncompliance by the Fund with Section 5(d) hereof.
If any action, suit or proceeding (together, a "Proceeding") is
brought against an Underwriter or any such person in respect of which
indemnity may be sought against the Fund or the Investment Adviser
pursuant to the foregoing paragraph, such Underwriter or such person
shall promptly notify the Fund or the Investment Adviser in writing of
the institution of such Proceeding and the Fund or the Investment
Adviser shall assume the defense of such Proceeding, including the
employment of counsel reasonably satisfactory to such indemnified
party and payment of all fees and expenses; provided, however, that
the omission to so notify the Fund or the Investment Adviser shall not
relieve the Fund or the Investment Adviser from any liability which
the Fund or the Investment Adviser may have to any Underwriter or any
such person or otherwise. Such Underwriter or such person shall have
the right to employ its or their own counsel in any such case, but the
reasonable fees and expenses of such counsel shall be at the expense
of such Underwriter or of such person unless the employment of such
counsel shall have been authorized in writing by the Fund or the
Investment Adviser, as the case may be, in connection with the defense
of such Proceeding or the Fund or the Investment Adviser shall not
have, within a reasonable period of time in light of the
circumstances, employed counsel to have charge of the defense of such
Proceeding or such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them, which
are different from, additional to or in conflict with those available
to the Fund or the Investment Adviser (in which case the Fund or the
Investment Adviser shall not have the right to direct the defense of
such Proceeding on behalf of the indemnified party or parties), in any
of which events such reasonable fees and expenses shall be borne by
the Fund or the Investment Adviser and paid as incurred (it being
understood, however, that the Fund or the Investment Adviser shall not
be liable for the expenses of more than one separate counsel (in
addition to any local
21
counsel) in any one Proceeding or series of related Proceedings in the
same jurisdiction representing the indemnified parties who are parties
to such Proceeding). Neither the Fund nor the Investment Adviser shall
be liable for any settlement of any Proceeding effected without its
written consent but if settled with the written consent of the Fund or
the Investment Adviser, the Fund or the Investment Adviser, as the
case may be, agrees to indemnify and hold harmless any Underwriter and
any such person from and against any loss or liability by reason of
such settlement. Notwithstanding the foregoing sentence, if at any
time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for reasonable fees and expenses of
counsel as contemplated by the second sentence of this paragraph, then
the indemnifying party agrees that it shall be liable for any
settlement of any Proceeding effected without its written consent if
(i) such settlement is entered into more than 60 business days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement and
(iii) such indemnified party shall have given the indemnifying party
at least 30 days' prior notice of its intention to settle. No
indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened
Proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional
release of such indemnified party from all liability on claims that
are the subject matter of such Proceeding and does not include an
admission of fault, culpability or a failure to act, by or on behalf
of such indemnified party.
(b) Each Underwriter severally agrees to indemnify, defend and hold
harmless the Fund and the Investment Adviser, and each of their
respective shareholders, partners, managers, members, trustees,
directors and officers, and any person who controls the Fund or the
Investment Adviser within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act, and the successors and assigns
of all of the foregoing persons from and against any loss, damage,
expense, liability or claim (including the reasonable cost of
investigation), which, jointly or severally, the Fund or the
Investment Adviser or any such person may incur under the Securities
Act, the Exchange Act, the Investment Company Act, the Advisers Act,
the common law or otherwise, insofar as such loss, damage, expense,
liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in and in
conformity with information furnished in writing by or on behalf of
such Underwriter to the Fund or the Investment Adviser expressly for
use with reference to such Underwriter in the Registration Statement
(or in the Registration Statement as amended by any post-effective
amendment thereof by the Fund) or in a Prospectus, or arises out
22
of or is based upon any omission or alleged omission to state a
material fact in connection with such information required to be
stated in such Registration Statement or such Prospectus or necessary
to make such information not misleading (with respect to the
Prospectus, in light of the circumstances under which they were made).
If any Proceeding is brought against the Fund, the Investment
Adviser or any such person in respect of which indemnity may be sought
against any Underwriter pursuant to the foregoing paragraph, the Fund,
the Investment Adviser or such person shall promptly notify such
Underwriter in writing of the institution of such Proceeding and such
Underwriter shall assume the defense of such Proceeding, including the
employment of counsel reasonably satisfactory to such indemnified
party and payment of all fees and expenses; provided, however, that
the omission to so notify such Underwriter shall not relieve such
Underwriter from any liability which such Underwriter may have to the
Fund, the Investment Advise or any such person or otherwise. The Fund,
the Investment Adviser or such person shall have the right to employ
its own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of the Fund, the Investment Adviser or
such person, as the case may be, unless the employment of such counsel
shall have been authorized in writing by such Underwriter in
connection with the defense of such Proceeding or such Underwriter
shall not have, within a reasonable period of time in light of the
circumstances, employed counsel to have charge of the defense of such
Proceeding or such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them, which
are different from or additional to or in conflict with those
available to such Underwriter (in which case such Underwriter shall
not have the right to direct the defense of such Proceeding on behalf
of the indemnified party or parties, but such Underwriter may employ
counsel and participate in the defense thereof but the fees and
expenses of such counsel shall be at the expense of such Underwriter),
in any of which events such fees and expenses shall be borne by such
Underwriter and paid as incurred (it being understood, however, that
such Underwriter shall not be liable for the expenses of more than one
separate counsel (in addition to any local counsel) in any one
Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such
Proceeding). No Underwriter shall be liable for any settlement of any
such Proceeding effected without the written consent of such
Underwriter but if settled with the written consent of such
Underwriter, such Underwriter agrees to indemnify and hold harmless
the Fund, the Investment Adviser and any such person from and against
any loss or liability by reason of such settlement. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for
fees and expenses of counsel as contemplated by the second sentence of
this paragraph, then the indemnifying party agrees that it shall be
liable for any
23
settlement of any Proceeding effected without its written consent if
(i) such settlement is entered into more than 60 business days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement and
(iii) such indemnified party shall have given the indemnifying party
at least 30 days' prior notice of its intention to settle. No
indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened
Proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional
release of such indemnified party from all liability on claims that
are the subject matter of such Proceeding and does not include an
admission of fault, culpability or a failure to act, by or on behalf
of such indemnified party.
(c) If the indemnification provided for in this Section 9 is unavailable
to an indemnified party under subsections (a) and (b) of this Section
9 in respect of any losses, damages, expenses, liabilities or claims
referred to therein, then each applicable indemnifying party, in lieu
of indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
damages, expenses, liabilities or claims (i) in such proportion as is
appropriate to reflect the relative benefits received by the Fund and
the Investment Adviser on the one hand and the Underwriters on the
other hand from the offering of the Shares or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault
of the Fund and the Investment Adviser on the one hand and of the
Underwriters on the other in connection with the statements or
omissions, which resulted in such losses, damages, expenses,
liabilities or claims, as well as any other relevant equitable
considerations. The relative benefits received by the Fund and the
Investment Adviser on the one hand and the Underwriters on the other
shall be deemed to be in the same respective proportions as the total
proceeds from the offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Fund and
the total underwriting discounts and commissions received by the
Underwriters, bear to the aggregate public offering price of the
Shares. The relative fault of the Fund and the Investment Adviser on
the one hand and of the Underwriters on the other shall be determined
by reference to, among other things, whether the untrue statement or
alleged untrue statement of a material fact or omission or alleged
omission relates to information supplied by the Fund or the Investment
Adviser or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission. The amount paid or payable by a party as a
result of the losses, damages, expenses, liabilities and claims
referred to in this subsection
24
shall be deemed to include any legal or other fees or expenses
reasonably incurred by such party in connection with investigating,
preparing to defend or defending any Proceeding.
(d) The Fund, the Investment Adviser, and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this
Section 9 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any
other method of allocation that does not take account of the equitable
considerations referred to in subsection (c) above. Notwithstanding
the provisions of this Section 9, no Underwriter shall be required to
contribute any amount in excess of the fees and commissions received
by such Underwriter. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 9 are several in proportion to
their respective underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained in this Section 9
and the covenants, warranties and representations of the Fund
contained in this Agreement shall remain in full force and effect
regardless of any investigation made by or on behalf of any
Underwriter, its partners, directors or officers or any person
(including each partner, officer or director of such person) who
controls any Underwriter within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, or by or on behalf
of the Fund or the Investment Adviser, its shareholders, partners,
advisers, members, trustees, directors or officers or any person who
controls the Fund or the Investment Adviser within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act,
and shall survive any termination of this Agreement or the issuance
and delivery of the Shares. The Fund, the Investment Adviser and each
Underwriter agree promptly to notify each other of the commencement of
any Proceeding against it and, in the case of the Fund or the
Investment Adviser, against any of the Fund's or the Adviser's
shareholders, partners, managers, members, trustees, directors or
officers in connection with the issuance and sale of the Shares, or in
connection with the Registration Statement or Prospectus.
(f) The Fund and the Investment Adviser each acknowledge that the
statements with respect to (1) the public offering of the Shares as
set forth on the cover page of and (2) stabilization and selling
concessions and reallowances of selling concessions and payment of
fees to Underwriters that meet certain minimum sales thresholds under
the caption "Underwriting" in the Prospectus constitute the only
information furnished in writing to the Fund by the Underwriters
expressly for use in such document. The Underwriters severally confirm
that these statements are
25
correct in all material respects and were so furnished by or on behalf
of the Underwriters severally for use in the Prospectus.
(g) Notwithstanding any other provisions in this Section 9, no party shall
be entitled to indemnification or contribution under this Underwriting
Agreement against any loss, claim, liability, expense or damage
arising by reason of such person's willful misfeasance, bad faith,
gross negligence or reckless disregard of its duties in the
performance of its duties hereunder. The parties hereto acknowledge
that the foregoing provision shall be applicable solely as to matters
arising under Section 17(i) of the Investment Company Act, and shall
not be construed to impose any duties or obligations upon any such
parties under this Agreement other than as specifically set forth
herein (it being understood that the Underwriters have no duty
hereunder to the Fund to perform any due diligence investigation).
10. NOTICES. Except as otherwise herein provided, all statements, requests,
notices and agreements shall be in writing or by telegram and, if to the
Underwriters, shall be sufficient in all respects if delivered or sent to
UBS Securities LLC, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
Syndicate Department, and, if to the Fund or the Investment Adviser, shall
be sufficient in all respects if delivered or sent to the Fund or the
Investment Adviser, as the case may be, at the offices of the Fund and the
Investment Adviser at ▇▇▇▇▇ ▇▇▇▇▇ Management, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇.
11. GOVERNING LAW; CONSTRUCTION. This Agreement and any claim, counterclaim or
dispute of any kind or nature whatsoever arising out of or in any way
relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The Section headings in this Agreement have been inserted as a matter
of convenience of reference and are not a part of this Agreement.
12. SUBMISSION TO JURISDICTION. Except as set forth below, no Claim may be
commenced, prosecuted or continued in any court other than the courts of
the State of New York located in the City and County of New York or in the
United States District Court for the Southern District of New York, which
courts shall have jurisdiction over the adjudication of such matters, and
the Fund and UBS Securities each consent to the jurisdiction of such courts
and personal service with respect thereto. The Fund and UBS Securities
hereby consent to personal jurisdiction, service and venue in any court in
which any Claim arising out of or in any way relating to this Agreement is
brought by any third party against UBS Securities or any indemnified party.
Each of UBS Securities, the Fund (on its behalf and, to the extent
permitted by applicable law, on behalf of its stockholders and affiliates)
and the Investment Adviser (on its behalf and, to the extent permitted by
applicable law, on behalf of its unitholders and affiliates) waives all
right to trial by jury in any action, proceeding or counterclaim (whether
based upon contract, tort or otherwise) in any way arising out of or
relating to this
26
Agreement. Each of the Fund and the Investment Adviser agrees that a final
judgment in any such action, proceeding or counterclaim brought in any such
court shall be conclusive and binding upon the Fund and the Investment
Adviser, as the case may be, and may be enforced in any other courts in the
jurisdiction of which the Fund and the Investment Adviser, as the case may
be, is or may be subject, by suit upon such judgment.
13. PARTIES AT INTEREST. The Agreement herein set forth has been and is made
solely for the benefit of the Underwriters, the Fund and the Investment
Adviser and to the extent provided in Section 9 hereof the controlling
persons, shareholders, partners, members, trustees, managers, directors and
officers referred to in such section, and their respective successors,
assigns, heirs, personal representatives and executors and administrators.
No other person, partnership, association or corporation (including a
purchaser, as such purchaser, from any of the Underwriters) shall acquire
or have any right under or by virtue of this Agreement.
14. COUNTERPARTS. This Agreement may be signed by the parties in one or more
counterparts which together shall constitute one and the same agreement
among the parties.
15. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Underwriters, the Fund and the Investment Adviser any successor or assign
of any substantial portion of the Fund's, the Investment Adviser's, or any
of the Underwriters' respective businesses and/or assets.
16. DISCLAIMER OF LIABILITY OF TRUSTEES AND BENEFICIARIES. A copy of the
Agreement and Declaration of Trust of each of the Fund and ▇▇▇▇▇ ▇▇▇▇▇ is
on file with the Secretary of State of The Commonwealth of Massachusetts,
and notice hereby is given that this Underwriting Agreement is executed on
behalf of the Fund and ▇▇▇▇▇ ▇▇▇▇▇, respectively, by an officer or Trustee
of the Fund or ▇▇▇▇▇ ▇▇▇▇▇, as the case may be, in his or her capacity as
an officer or Trustee of the Fund or ▇▇▇▇▇ ▇▇▇▇▇, as the case may be, and
not individually and that the obligations under or arising out of this
Underwriting Agreement are not binding upon any of the Trustees, officers
or shareholders individually but are binding only upon the assets and
properties of the Fund or ▇▇▇▇▇ ▇▇▇▇▇, as the case may be.
27
If the foregoing correctly sets forth the understanding among the Fund, the
Investment Adviser and the Underwriters, please so indicate in the space
provided below, whereupon this letter and your acceptance shall constitute a
binding agreement among the Fund, the Investment Adviser and the Underwriters,
severally.
Very truly yours,
▇▇▇▇▇ ▇▇▇▇▇ CREDIT OPPORTUNITIES FUND
By:
------------------------------------
Title:
---------------------------------
▇▇▇▇▇ ▇▇▇▇▇ MANAGEMENT
By:
------------------------------------
Title:
---------------------------------
28
Accepted and agreed to as of the
date first above written, on behalf of
themselves and the other several
Underwriters named in Schedule A
UBS SECURITIES LLC
By:
---------------------------------
Title:
------------------------------
By:
---------------------------------
Title:
------------------------------
29
SCHEDULE A
Underwriters Number of Shares
------------ ----------------
UBS Securities LLC
[_________________]
Total.....................................................
================
Schedule A-1
SCHEDULE B
FORM OF OPINION OF
▇▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP REGARDING THE FUND
1. The Registration Statement and all post-effective amendments, if
any, are effective under the Securities Act and no stop order with respect
thereto has been issued and no proceeding for that purpose has been instituted
or, to the best of our knowledge, is threatened by the Commission. Any filing of
the Prospectus or any supplements thereto required under Rule 497 of the
Securities Act Rules prior to the date hereof have been made in the manner and
within the time required by such rule.
2. The Fund has been duly formed and is validly existing as a
Massachusetts business trust under the laws of the Commonwealth of
Massachusetts, with full power and authority to conduct all the activities
conducted by it, to own or lease all assets owned (or to be owned) or leased (or
to be leased) by it and to conduct its business as described in the Registration
Statement and Prospectus, and the Fund is duly licensed and qualified to do
business and in good standing in each jurisdiction in which its ownership or
leasing of property or its conducting of business requires such qualification,
and the Fund owns, possesses or has obtained and currently maintains all
governmental licenses, permits, consents, orders, approvals and other
authorizations, whether foreign or domestic, necessary to carry on its business
as contemplated in the Prospectus. The Fund has no subsidiaries.
3. The capitalization of the Fund is as set forth in the Registration
Statement and the Prospectus. The Shares of Beneficial Interest of the Fund
conform in all respects to the description of them in the Prospectus. All the
outstanding Shares of Beneficial Interest have been duly authorized and are
validly issued, fully paid and nonassessable (except as described in the
Registration Statement). The Shares to be issued and delivered to and paid for
by the Underwriters in accordance with the Underwriting Agreement against
payment therefor as provided by the Underwriting Agreement have been duly
authorized and when issued and delivered to the Underwriters will have been
validly issued and will be fully paid and nonassessable (except as described in
the Registration Statement). No person is entitled to any preemptive or other
similar rights with respect to the Shares.
4. The Fund is duly registered with the Commission under the
Investment Company Act as a diversified, closed-end management investment
company and all action under the Securities Act, the Investment Company Act, the
Securities Act Rules and the Investment Company Act Rules, as the case may be,
necessary to make the public offering and consummate the sale of the Shares as
provided in the Underwriting Agreement has or will have been taken by the Fund.
5. The Fund has full power and authority to enter into each of the
Underwriting Agreement, the Investment Advisory Agreement, the Custodian
Agreement, the Administration Agreement, and the Transfer Agency Agreement
(collectively, the "Fund Agreements") and to perform all of the terms and
provisions
Schedule B-1
thereof to be carried out by it and (A) each Fund Agreement has been duly and
validly authorized, executed and delivered by the Fund, (B) each Fund Agreement
complies in all material respects with all applicable provisions of the
Investment Company Act, the Advisers Act, the Investment Company Act Rules and
the Advisers Act Rules, as the case may be, and (C) assuming due authorization,
execution and delivery by the other parties thereto, each Fund Agreement
constitutes the legal, valid and binding obligation of the Fund enforceable in
accordance with its terms, (1) subject, as to enforcement, to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights generally
and to general equitable principles (regardless of whether enforcement is sought
in a proceeding in equity or at law) and (2) as rights to indemnity thereunder
may be limited by federal or state securities laws.
6. None of (A) the execution and delivery by the Fund of the Fund
Agreements, (B) the issue and sale by the Fund of the Shares as contemplated by
the Underwriting Agreement and (C) the performance by the Fund of its
obligations under the Fund Agreements or consummation by the Fund of the other
transactions contemplated by the Fund Agreements conflicts with or will conflict
with, or results or will result in a breach of, the Declaration of Trust or the
By-laws of the Fund or any agreement or instrument to which the Fund is a party
or by which the Fund is bound, or any law, rule or regulation, or order of any
court, governmental instrumentality, securities exchange or association or
arbitrator, whether foreign or domestic, applicable to the Fund, except that we
express no opinion as to the securities or "blue sky" laws applicable in
connection with the purchase and distribution of the Shares by the Underwriters
pursuant to the Underwriting Agreement.
7. The Fund is not currently in breach of, or in default under, any
written agreement or instrument to which it is a party or by which it or its
property is bound or affected.
8. No consent, approval, authorization or order of any court or
governmental agency or body or securities exchange or association, whether
foreign or domestic, is required by the Fund for the consummation by the Fund of
the transactions to be performed by the Fund or the performance by the Fund of
all the terms and provisions to be performed by or on behalf of it in each case
as contemplated in the Fund Agreements, except such as (A) have been obtained
under the Securities Act, the Investment Company Act, the Advisers Act, the
Securities Act Rules, the Investment Company Act Rules and the Advisers Act
Rules and (B) may be required by the New York Stock Exchange or under state
securities or "blue sky" laws in connection with the purchase and distribution
of the Shares by the Underwriters pursuant to the Underwriting Agreement.
9. The Shares have been approved for listing on the New York Stock
Exchange, subject to official notice of issuance, and the Fund's Registration
Statement on Form 8-A under the 1934 Act is effective.
Schedule B-2
10. There is no action, suit or proceeding before or by any court,
commission, regulatory body, administrative agency or other governmental agency
or body, foreign or domestic, now pending or, to our knowledge, threatened
against or affecting the Fund, which is required to be disclosed in the
Prospectus that is not disclosed in the Prospectus, and there are no contracts,
franchises or other documents that are of a character required to be described
in, or that are required to be filed as exhibits to, the Registration Statement
that have not been described or filed as required.
11. The Fund does not require any tax or other rulings to enable it to
qualify as a regulated investment company under Subchapter M of the Code.
12. Each of the section in the Prospectus entitled
"Distributions--Federal Income Tax Matters" and the section in the Statement of
Additional Information entitled "Taxes" is a fair summary of the principal
United States federal income tax rules currently in effect applicable to the
Fund and to the purchase, ownership and disposition of the Shares.
13. The Registration Statement (except the financial statements and
schedules and other financial data included therein as to which we express no
view), at the time it became effective, and the Prospectus (except as
aforesaid), as of the date thereof, complied as to form in all material respects
to the requirements of the Securities Act, the Investment Company Act and the
rules and regulations of the Commission thereunder.
In rendering our opinion, we have relied, as to factual matters, upon
the attached written certificates and statements of officers of the Fund.
In connection with the registration of the Shares, we have advised the
Fund as to the requirements of the Securities Act, the Investment Company Act
and the applicable rules and regulations of the Commission thereunder and have
rendered other legal advice and assistance to the Fund in the course of its
preparation of the Registration Statement and the Prospectus. Rendering such
assistance involved, among other things, discussions and inquiries concerning
various legal and related subjects and reviews of certain corporate records,
documents and proceedings. We also participated in conferences with
representatives of the Fund and its accountants at which the contents of the
Registration Statement and Prospectus and related matters were discussed. With
your permission, we have not undertaken, except as otherwise indicated herein,
to determine independently, and do not assume any responsibility for, the
accuracy, completeness or fairness of the statements in the Registration
Statement or Prospectus. On the basis of the information which was developed in
the course of the performance of the services referred to above, no information
has come to our attention that would lead us to believe that the Registration
Statement, at the time it became effective, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, or that the
Prospectus, as of its date and as of the date hereof, contained or contains an
untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements
Schedule B-3
therein, in the light of the circumstances under which they were made, not
misleading or that any amendment or supplement to the Prospectus, as of its
respective date, and as of the date hereof, contained any untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements in the Prospectus, in the light of the circumstances under
which they were made, not misleading (except the financial statements, schedules
and other financial data included therein, as to which we express no view).
Schedule B-4
SCHEDULE C
FORM OF OPINION OF INTERNAL COUNSEL
REGARDING ▇▇▇▇▇ ▇▇▇▇▇ MANAGEMENT
1. ▇▇▇▇▇ ▇▇▇▇▇ has been duly formed and is validly existing as a
Massachusetts business trust under the laws of its jurisdiction of incorporation
with full power and authority to conduct all of the activities conducted by it,
to own or lease all of the assets owned or leased by it and to conduct its
business as described in the Registration Statement and Prospectus, and ▇▇▇▇▇
▇▇▇▇▇ is duly licensed and qualified and in good standing in each other
jurisdiction in which it is required to be so qualified and ▇▇▇▇▇ ▇▇▇▇▇ owns,
possesses or has obtained and currently maintains all governmental licenses,
permits, consents, orders, approvals and other authorizations, whether foreign
or domestic, necessary for ▇▇▇▇▇ ▇▇▇▇▇ to carry on its business as contemplated
in the Registration Statement and the Prospectus.
2. ▇▇▇▇▇ ▇▇▇▇▇ is duly registered as an investment adviser under the
Advisers Act and is not prohibited by the Advisers Act, the Investment Company
Act, the Advisers Act Rules or the Investment Company Act Rules from acting as
investment adviser for the Fund as contemplated by the Investment Advisory
Agreement, the Registration Statement and the Prospectus.
3. ▇▇▇▇▇ ▇▇▇▇▇ has full power and authority to enter into each of the
Underwriting Agreement, the Investment Advisory Agreement, the Administration
Agreement, the Additional Compensation Agreement, and the [Structuring Fee
Agreement] (collectively, the "▇▇▇▇▇ ▇▇▇▇▇ Agreements") and to carry out all the
terms and provisions thereof to be carried out by it, and each such agreement
has been duly and validly authorized, executed and delivered by ▇▇▇▇▇ ▇▇▇▇▇;
each ▇▇▇▇▇ ▇▇▇▇▇ Agreement complies in all material respects with all provisions
of the Investment Company Act, the Advisers Act, the Investment Company Act
Rules and the Advisers Act Rules; and assuming due authorization, execution and
delivery by the other parties thereto, each ▇▇▇▇▇ ▇▇▇▇▇ Agreement constitutes a
legal, valid and binding obligation of ▇▇▇▇▇ ▇▇▇▇▇, enforceable in accordance
with its terms, (1) subject, as to enforcement, to applicable bankruptcy,
insolvency and similar laws affecting creditors' rights generally and to general
equitable principles (regardless of whether enforcement is sought in a
proceeding in equity or at law) and (2) as rights to indemnity thereunder may be
limited by federal or state securities laws.
4. Neither (A) the execution and delivery by ▇▇▇▇▇ ▇▇▇▇▇ of any ▇▇▇▇▇
▇▇▇▇▇ Agreement nor (B) the consummation by ▇▇▇▇▇ ▇▇▇▇▇ of the transactions
contemplated by, or the performance of its obligations under any ▇▇▇▇▇ ▇▇▇▇▇
Agreement conflicts or will conflict with, or results or will result in a breach
of, the Agreement and Declaration of Trust or By-Laws of ▇▇▇▇▇ ▇▇▇▇▇ or any
agreement or instrument to which ▇▇▇▇▇ ▇▇▇▇▇ is a party or by which ▇▇▇▇▇ ▇▇▇▇▇
is bound, or any law, rule or regulation, or order of any court, governmental
instrumentality, securities
Schedule C-1
exchange or association or arbitrator, whether foreign or domestic, applicable
to ▇▇▇▇▇ ▇▇▇▇▇.
5. No consent, approval, authorization or order of any court,
governmental agency or body or securities exchange or association, whether
foreign or domestic, is required for the consummation of the transactions
contemplated in, or the performance by ▇▇▇▇▇ ▇▇▇▇▇ of its obligations under, any
▇▇▇▇▇ ▇▇▇▇▇ Agreement, except such as have been obtained under the Investment
Company Act, the Advisers Act, the Securities Act, the Investment Company Act
Rules, the Advisers Act Rules and the Securities Act Rules.
6. The description of ▇▇▇▇▇ ▇▇▇▇▇ and its business, and the statements
attributable to ▇▇▇▇▇ ▇▇▇▇▇, in the Registration Statement and the Prospectus
complies with the requirements of the Securities Act, the Investment Company
Act, the Securities Act Rules and the Investment Company Act Rules and do not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the statements
therein not misleading.
7. There is no action, suit or proceeding before or by any court,
commission, regulatory body, administrative agency or other governmental agency
or body, foreign or domestic, now pending or, to our knowledge, threatened
against or affecting ▇▇▇▇▇ ▇▇▇▇▇ of a nature required to be disclosed in the
Registration Statement or Prospectus or that might reasonably result in any
material adverse change in the condition, financial or otherwise, business
affairs or business prospects of ▇▇▇▇▇ ▇▇▇▇▇ or the ability of ▇▇▇▇▇ ▇▇▇▇▇ to
fulfill its respective obligations under any ▇▇▇▇▇ ▇▇▇▇▇ Agreement.
8. The Registration Statement (except the financial statements and
schedules and other financial data included therein as to which we express no
view), at the time it became effective, and the Prospectus (except as
aforesaid), as of the date thereof, appeared on their face to be appropriately
responsive in all material respects to the requirements of the Securities Act,
the Investment Company Act and the rules and regulations of the Commission
thereunder.
In rendering our opinion, we have relied, as to factual matters, upon
the attached written certificates and statements of officers of ▇▇▇▇▇ ▇▇▇▇▇.
In connection with the registration of the Shares, we have advised
▇▇▇▇▇ ▇▇▇▇▇ as to the requirements of the Securities Act, the Investment Company
Act and the applicable rules and regulations of the Commission thereunder and
have rendered other legal advice and assistance to ▇▇▇▇▇ ▇▇▇▇▇ in the course of
the preparation of the registration Statement and the Prospectus. Rendering such
assistance involved, among other things, discussions and inquiries concerning
various legal and related subjects and reviews of certain corporate records,
documents and proceedings. We also participated in conferences with
representatives of the Fund and its accountants and ▇▇▇▇▇ ▇▇▇▇▇ at which the
contents of the registration and Prospectus and related matters were discussed.
Schedule C-2
With your permission, we have not undertaken, except as otherwise indicated
herein, to determine independently, and do not assume any responsibility for,
the accuracy, completeness or fairness of the statements in the Registration
Statement or Prospectus. On the basis of the information which was developed in
the course of the performance of the services referred to above, no information
has come to our attention that would lead us to believe that the Registration
Statement, at the time it became effective, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, or that the
Prospectus, as of its date and as of the date hereof, contained or contains an
untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading or that any amendment
or supplement to the Prospectus, as of its respective date, and as of the date
hereof, contained any untrue statement of a material fact or omitted or omits to
state a material fact necessary in order to make the statements in the
Prospectus, in the light of the circumstances under which they were made, not
misleading (except the financial statements, schedules and other financial data
included therein, as to which we express no view).
Schedule C-3
SCHEDULE D
FORM OF ACCOUNTANT'S LETTER
______________, 2006
The Board of Trustees of
▇▇▇▇▇ ▇▇▇▇▇ Credit Opportunities Fund
The ▇▇▇▇▇ ▇▇▇▇▇ Building
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
UBS Securities LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
as Managing Representative of the Underwriters
Ladies and Gentlemen:
We have audited the statement of assets and liabilities of ▇▇▇▇▇ ▇▇▇▇▇
Credit Opportunities Fund (the "Fund") as of [____________], 2006 included in
the Registration Statement on Form N-2 filed by the Fund under the Securities
Act of 1933 (the "Securities Act") (File No. 333-[_]) and under the Investment
Company Act of 1940 (the "Investment Company Act") (File No. 811-[_]); such
statement and our report with respect to such statement are included in the
Registration Statement.
In connection with the Registration Statement:
1. We are independent public accountants with respect to the Fund
within the meaning of the Securities Act and the applicable rules and
regulations thereunder.
2. In our opinion, the statement of assets and liabilities included in
the Registration Statement and audited by us complies as to form in all respects
with the applicable accounting requirements of the Securities Act, the
Investment Company Act and the respective rules and regulations thereunder.
3. For purposes of this letter we have read the minutes of all
meetings of the Shareholders, the Board of Trustees and all Committees of the
Board of Trustees of the Fund as set forth in the minute books at the offices of
the Fund, officials of the Fund having advised us that the minutes of all such
meetings through [____________], 2006, were set forth therein.
4. Fund officials have advised us that no financial statements as of
any date subsequent to [____________], 2006, are available. We have made
inquiries of certain officials of the Fund who have responsibility for financial
and accounting matters
Schedule D-1
regarding whether there was any change at [____________], 2006, in the capital
shares or net assets of the Fund as compared with amounts shown in the
[____________], 2006, statement of assets and liabilities included in the
Registration Statement, except for changes that the Registration Statement
discloses have occurred or may occur. On the basis of our inquiries and our
reading of the minutes as described in Paragraph 3, nothing came to our
attention that caused us to believe that there were any such changes.
The foregoing procedures do not constitute an audit made in accordance
with generally accepted auditing standards. Accordingly, we make no
representations as to the sufficiency of the foregoing procedures for your
purposes.
This letter is solely for the information of the addressees and to
assist the underwriters in conducting and documenting their investigation of the
affairs of the Fund in connection with the offering of the securities covered by
the Registration Statement, and is not to be used, circulated, quoted or
otherwise referred to within or without the underwriting group for any other
purpose, including but not limited to the registration, purchase or sale of
securities, nor is it to be filed with or referred to in whole or in part in the
Registration Statement or any other document, except that reference may be made
to it in the underwriting agreement or in any list of closing documents
pertaining to the offering of the securities covered by the Registration
Statement.
Very truly yours,
Schedule D-2