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EXHIBIT 2(h)
Municipal Auction Rate Cumulative Preferred Shares
▇▇▇▇▇▇ STRATEGIC MUNICIPAL INCOME TRUST
________ Shares, Series T
Liquidation Preference $25,000 Per Share
UNDERWRITING AGREEMENT
September __, 1999
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
▇▇▇▇▇▇ Strategic Municipal Income Trust, a Massachusetts
business trust (the "Trust"), proposes, upon the terms and conditions set forth
herein, to issue and sell an aggregate of ______ shares of its Municipal Auction
Rate Cumulative Preferred Shares, Series T (the "Municipal Preferred"), each
with a liquidation preference of $25,000 per share (the shares of Municipal
Preferred to be sold hereby are referred to herein, collectively, as the
"Shares"). The Shares will be authorized by, and subject to the terms and
conditions of, the Amended and Restated Certificate of Designation for Preferred
Shares of the Trust (the "Certificate") in the form filed as an exhibit to the
Registration Statement referred to in Section 1 of this agreement. The Trust and
its investment adviser, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Investments, Inc. (the "Adviser"), wish
to confirm as follows their agreement with ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. (the
"Underwriter") in connection with the purchase of the Shares by the Underwriter.
Collectively, the Investment Management Agreement dated as of
September 7, 1998 between the Trust and the Adviser ("the "Investment Management
Agreement"), the Custodian Agreement dated as of March 15, 1999 between the
Trust and State Street Bank and Trust Company ("SSBT") (the "Custodian
Agreement"), the Agency Agreement dated as of March 15, 1989 between the Trust
and Investors Fiduciary Trust Company (the "Agency Agreement"), the Auction
Agency Agreement dated as of _____, 1999 between the Trust and Bankers Trust
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Company (the "Auction Agency Agreement") and the Broker-Dealer Agreement dated
as of September __, 1999 between the Trust and ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. are
hereinafter referred to as the "Trust Agreements." This Underwriting Agreement
is hereinafter referred to as the "Agreement."
1.Registration Statement and Prospectus. The Trust has prepared
in conformity with the provisions of the Securities Act of 1933, as amended (the
"1933 Act"), the Investment Company Act of 1940, as amended (the "1940 Act"),
and the rules and regulations of the Securities and Exchange Commission (the
"Commission") promulgated under the 1933 Act (the "1933 Act Rules and
Regulations") and the 1940 Act (the "1940 Act Rules and Regulations" and,
together with the 1933 Act Rules and Regulations, the "Rules and Regulations"),
a registration statement on Form N-2, as amended by Pre-Effective Amendment No.
1 and _________ (File Nos. 333-78945 and 811-5467), under the 1933 Act and the
1940 Act (the "registration statement"), including a prospectus relating to the
Shares, and has filed the registration statement and prospectus in accordance
with the 1933 Act and the 1940 Act. The Trust also has filed a notification of
registration of the Trust as an investment company under the 1940 Act on Form
N-8A (the "1940 Act Notification"). The term "Registration Statement" as used in
this Agreement means the registration statement (including all financial
schedules and exhibits), as amended at the time it becomes effective under the
1933 Act or, if the registration statement became effective under the 1933 Act
prior to the execution of this Agreement, as amended or supplemented at the time
it became effective prior to the execution of this Agreement, and includes any
information deemed to be included by Rule 430A under the 1933 Act Rules and
Regulations. If it is contemplated, at the time this Agreement is executed, that
a post-effective amendment to the registration statement will be filed under the
1933 Act and must be declared effective before the offering of the Shares may
commence, the term "Registration Statement" as used in this Agreement means the
registration statement as amended by said post-effective amendment. If the Trust
has filed an abbreviated registration statement to register an additional amount
of Shares pursuant to Rule 462(b) under the 1933 Act (the "Rule 462 Registration
Statement"), then any reference herein to the term "Registration Statement"
shall include such Rule 462 Registration Statement. The term "Prospectus" as
used in this Agreement means the prospectus and statement of additional
information in the forms included in the Registration Statement or any amendment
or supplement thereto. Specifically, if the prospectus and statement of
additional information included in the Registration Statement omit information
in reliance on Rule 430A under the 1933 Act Rules and Regulations and such
information is included in a prospectus and statement of additional information
filed with the Commission pursuant to Rule 497(h) under the 1933 Act, the term
"Prospectus" as used in this Agreement means the prospectus and statement of
additional information in the forms included in the Registration Statement as
supplemented by the addition of the information contained in the prospectus
filed with the Commission pursuant to Rule 497(h). The term "Prepricing
Prospectus" as used in this Agreement means the prospectus and statement of
additional information subject to completion in the forms included in the
registration statement at the time of filing of amendment no. 1 to the
registration statement with the Commission on September __, 1999, and as such
prospectus and statement of additional information shall have been amended from
time to time
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prior to the date of the Prospectus, together with any other prospectus and
statement of additional information relating to the Trust other than the
Prospectus approved in writing by or directly or indirectly prepared by the
Trust or the Adviser; it being understood that the definition of Prepricing
Prospectus above shall not include any Prepricing Prospectus prepared by the
Underwriter unless approved in writing by the Trust or Adviser. The terms
"Registration Statement," "Prospectus" and "Prepricing Prospectus" shall also
include any financial statements and other information incorporated by reference
therein.
The Trust has furnished the Underwriter with copies of such
registration statement, each amendment to such registration statement filed with
the Commission and each Prepricing Prospectus.
2. Agreements to Sell and Purchase. The Trust hereby agrees,
subject to all the terms and conditions set forth herein, to issue and sell to
the Underwriter and, upon the basis of the representations, warranties and
agreements of the Trust and the Adviser herein contained and subject to all the
terms and conditions set forth herein, the Underwriter agrees to purchase from
the Trust, at a purchase price of $_______ per Share, the number of shares of
Municipal Preferred set forth opposite the name of the Underwriter in Schedule I
hereto.
3. Terms of Public Offering. The Trust and the Adviser have been
advised by the Underwriter that the Underwriter proposes to make a public
offering of the Shares as soon after the Registration Statement and this
Agreement have become effective as in the Underwriter's judgment is advisable
and initially to offer the Shares upon the terms set forth in the Prospectus.
4. Delivery of the Shares and Payment Therefor. Delivery to the
Underwriter of and payment for the Shares shall be made at the office of ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, or through the
facilities of The Depository Trust Company or another mutually agreeable
facility, at 9:30 A.M., New York City time, on September __, 1999 (the "Closing
Date"). The place of closing for the Shares and the Closing Date may be varied
by agreement between the Underwriter and the Trust.
Certificates for the Shares shall be registered in such names
and in such denominations as the Underwriter shall request prior to 9:30 A.M.,
New York City time, on the second business day preceding the Closing Date. Such
certificates shall be made available to the Underwriter in New York City for
inspection not later than 9:30 A.M., New York City time, on the business day
next preceding the Closing Date. The certificates evidencing the Shares shall be
delivered to the Underwriter on the Closing Date, through the facilities of The
Depository Trust Company, against payment of the purchase price therefor in
immediately available funds.
5. Agreements of the Trust and the Adviser. The Trust and the
Adviser, jointly and severally, agree with the Underwriter as follows:
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(a) If, at the time this Agreement is executed and delivered, it
is necessary for the Registration Statement or a post-effective amendment
thereto to be declared effective under the 1933 Act before the offering of the
Shares may commence, the Trust will endeavor to cause the Registration Statement
or such post-effective amendment to become effective under the 1933 Act as soon
as possible and will advise the Underwriter promptly and, if requested by the
Underwriter, will confirm such advice in writing when the Registration Statement
or such post-effective amendment has become effective.
(b) The Trust will advise the Underwriter promptly and, if
requested by the Underwriter, will confirm such advice in writing: (i) of any
request made by the Commission for amendment of or a supplement to the
Registration Statement, any Prepricing Prospectus or the Prospectus (or any
amendment or supplement to any of the foregoing) or for additional information,
(ii) of the issuance by the Commission, the National Association of Securities
Dealers, Inc. (the "NASD"), any state securities commission, any national
securities exchange, any arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or any official of any
order suspending the effectiveness of the Registration Statement, prohibiting or
suspending the use of the Prospectus or any Prepricing Prospectus, or any sales
material (as hereinafter defined), of any notice pursuant to Section 8(e) of the
1940 Act, of the suspension of qualification of the Shares for offering or sale
in any jurisdiction, or the initiation of any proceeding for any such purposes,
(iii) of receipt by the Trust, the Adviser, any affiliate of the Trust or the
Adviser or any representative or attorney of the Trust or the Adviser of any
other material communication from the Commission, the NASD, any state securities
commission, any national securities exchange, any arbitrator, any court or any
other governmental, regulatory, self-regulatory or administrative agency or any
official relating to the Trust (if such communication relating to the Trust is
received by such person within three years after the date of this Agreement),
the Registration Statement, the 1940 Act Notification, the Prospectus, any
Prepricing Prospectus, any sales material (as herein defined) (or any amendment
or supplement to any of the foregoing) or this Agreement or any of the Trust
Agreements and (iv) within the period of time referred to in paragraph (f)
below, of any material adverse change in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the
Trust or the Adviser or of the happening of any other event which makes any
statement of a material fact made in the Registration Statement or the
Prospectus, or any Prepricing Prospectus or any sales materials (as herein
defined) (or any amendment or supplement to any of the foregoing) untrue or
which requires the making of any additions to or changes in the Registration
Statement or the Prospectus, or any Prepricing Prospectus or any sales materials
(as herein defined) (or any amendment or supplement to any of the foregoing) in
order to state a material fact required by the 1933 Act, the 1940 Act or the
Rules and Regulations to be stated therein or necessary in order to make the
statements therein (in the case of a prospectus, in light of the circumstances
under which they were made) not misleading or of the necessity to amend or
supplement the Registration Statement, the Prospectus, or any Prepricing
Prospectus or any sales material (as herein defined) (or any amendment or
supplement to any of the foregoing) to comply with the 1933 Act, the 1940 Act,
the Rules and Regulations or any other law or order of any court or regulatory
body. If at any time the Commission, the NASD, any state securities commission,
any national securities
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exchange, any arbitrator, any court or any other governmental, regulatory,
self-regulatory or administrative agency or any official shall issue any order
suspending the effectiveness of the Registration Statement, prohibiting or
suspending the use of the Prospectus or any sales material (as herein defined)
(or any amendment or supplement to any of the foregoing) or suspending the
qualification of the Shares for offering or sale in any jurisdiction, the Trust
will make every reasonable effort to obtain the withdrawal of such order at the
earliest possible time.
(c) The Trust will furnish to the Underwriter, without charge,
three signed copies of the Registration Statement as originally filed with the
Commission and of each amendment thereto, including financial statements and all
exhibits thereto, and will also furnish to the Underwriter, without charge, such
number of conformed copies of the Registration Statement as originally filed and
of each amendment thereto, but without exhibits, as the Underwriter may request.
(d) The Trust will not (i) file any amendment to the
Registration Statement or make any amendment or supplement to the Prospectus, or
any sales material (as herein defined), of which the Underwriter shall not
previously have been advised or to which the Underwriter shall reasonably object
after being so advised or (ii) so long as, in the opinion of counsel for the
Underwriter, a Prospectus is required by the 1933 Act to be delivered in
connection with sales by the Underwriter or any dealer, file any information,
documents or reports pursuant to the Securities Exchange Act of 1934, as amended
(the "1934 Act"), without delivering a copy of such information, documents or
reports to the Underwriter prior to or concurrently with such filing.
(e) Prior to the execution and delivery of this Agreement, the
Trust has delivered to the Underwriter, without charge, in such quantities as
the Underwriter has requested, copies of each form of the Prepricing Prospectus.
The Trust consents to the use, in accordance with the provisions of the 1933 Act
and with the state securities or blue sky laws of the jurisdictions in which the
Shares are offered by the Underwriter and by dealers, prior to the date of the
Prospectus, of each Prepricing Prospectus so furnished by the Trust.
(f) As soon after the execution and delivery of this Agreement
as possible and thereafter from time to time for such period as in the opinion
of counsel for the Underwriter a prospectus is required by the 1933 Act to be
delivered in connection with sales by the Underwriter or any dealer, the Trust
will expeditiously deliver to the Underwriter and each dealer, without charge,
as many copies of the Prospectus as the Underwriter may request. The Trust
consents to the use of the Prospectus in accordance with the provisions of the
1933 Act and with the state securities or blue sky laws of the jurisdictions in
which the Shares are offered by the Underwriter and by all dealers to whom
Shares may be sold, both in connection with the offering and sale of the Shares
and for such period of time thereafter as the Prospectus is required by the 1933
Act to be delivered in connection with sales by the Underwriter or any dealer.
If during such period of time any event shall occur that in the judgment of the
Trust or in the opinion of counsel for the Underwriter is required to be set
forth in the Registration Statement or the Prospectus (as then amended or
supplemented) or should be set forth therein in order to make the
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statements therein (in the case of the Prospectus, in light of the circumstances
under which they were made) not misleading, or if it is necessary to supplement
or amend the Registration Statement or the Prospectus to comply with the 1933
Act, the 1940 Act, the Rules and Regulations or any other federal law, rule or
regulation, or any state securities or blue sky disclosure laws, rules or
regulations, the Trust will forthwith prepare and, subject to the provisions of
paragraph (d) above, promptly file with the Commission an appropriate supplement
or amendment thereto, and will expeditiously furnish to the Underwriter and
dealers, without charge, a reasonable number of copies thereof. In the event
that the Trust and the Underwriter agree that the Registration Statement or the
Prospectus should be amended or supplemented, the Trust, if requested by the
Underwriter, will promptly issue a press release announcing or disclosing the
matters to be covered by the proposed amendment or supplement.
(g) The Trust will make generally available to its security
holders an earnings statement, which need not be audited, covering a
twelve-month period ending not later than 15 months after the effective date of
the Registration Statement as soon as practicable after the end of such period,
which earnings statement shall satisfy the provisions of Section 11(a) of the
1933 Act and Rule 158 of the 1933 Act Rules and Regulations.
(h) During the period of five years hereafter, the Trust will
furnish to the Underwriter (i) as soon as available, a copy of each report of
the Trust mailed to stockholders or filed with the Commission or furnished to
the New York Stock Exchange (the "NYSE") other than reports on Form N-SAR, and
(ii) from time to time such other information concerning the Trust as the
Underwriter may reasonably request.
(i) If this Agreement shall terminate or shall be terminated
after execution pursuant to any provisions hereof (otherwise than by notice
given by the Underwriter terminating this Agreement pursuant to Section 12
hereof) or if this Agreement shall be terminated by the Underwriter because of
any failure or refusal on the part of the Trust or the Adviser to comply with
the terms or fulfill any of the conditions of this Agreement, the Trust and the
Adviser, jointly and severally, agree to reimburse the Underwriter for all
out-of-pocket expenses (including reasonable fees and expenses of counsel for
the Underwriter) incurred by the Underwriter in connection herewith.
(j) The Trust will apply the net proceeds from the sale of the
Shares in accordance with the description set forth in the Prospectus and in
such a manner as to comply with the investment objectives, policies and
restrictions of the Trust as described in the Prospectus.
(k) The Trust will timely file the Prospectus with the
Commission pursuant to Rule 497(c) or Rule 497(h) of the 1933 Act Rules and
Regulations, whichever is applicable or, if applicable, will timely file the
certification permitted by Rule 497(j) of the 1933 Act Rules and Regulations and
will advise the Underwriter of the time and manner of such filing.
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(l) Except as provided in this Agreement, or as described in the
Prospectus, the Trust will not sell, contract to sell, or otherwise dispose of
any senior securities (as defined in the 1940 Act) of the Trust, or grant any
options or warrants to purchase senior securities of the Trust, for a period of
180 days after the date of the Prospectus, without the prior written consent of
the Underwriter.
(m) Except as stated in this Agreement and in the Prepricing
Prospectus and Prospectus, neither the Trust nor the Adviser has taken, nor will
it take, directly or indirectly, any action designed to or that might reasonably
be expected to cause or result in stabilization or manipulation of the price of
any securities issued by the Trust to facilitate the sale or resale of the
Shares.
(n) The Trust will use its best efforts to cause the Municipal
Preferred, prior to the Closing Date, to be assigned a rating of 'Aaa' by
▇▇▇▇▇'▇ Investors Service, Inc. ("Moody's") and AAA by Standard & Poor's Rating
Group ("S&P" and, together with Moody's, the "Rating Agencies").
(o) The Trust and the Adviser will use their best efforts to
perform all of the agreements required of them and discharge all conditions to
closing as set forth in this Agreement.
6. Representations and Warranties of the Trust and the Adviser
with respect to the Trust.
(i) The Trust represents and warrants to the Underwriter that:
(a) Each Prepricing Prospectus included as part of the
registration statement as originally filed or as part of any amendment or
supplement thereto, or filed pursuant to Rule 497 of the 1933 Act Rules and
Regulations, complied when so filed in all material respects with the provisions
of the 1933 Act, the 1940 Act and the Rules and Regulations. The Commission has
not issued any order preventing or suspending the use of any Prepricing
Prospectus or the Prospectus.
(b) The registration statement in the form in which it became or
becomes effective and also in such form as it may be when any post-effective
amendment thereto shall become effective and the Prospectus and any supplement
or amendment thereto when filed with the Commission under Rule 497 of the 1933
Act Rules and Regulations and the 1940 Act Notification when originally filed
with the Commission and any amendment or supplement thereto when filed with the
Commission, complied or will comply in all material respects with the
requirements of the 1933 Act, the 1940 Act and the Rules and Regulations and did
not or will not at any such times contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading, except that this
representation and warranty does not apply to statements in or omissions from
the
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registration statement or the Prospectus made in reliance upon and in conformity
with information relating to the Underwriter furnished to the Trust in writing
by or on behalf of the Underwriter expressly for use therein.
(c) All the outstanding Common Shares (as defined in the
Prospectus) of the Trust have been duly authorized and validly issued, are fully
paid and nonassessable by the Trust and are free of any preemptive or similar
rights; the Shares have been duly authorized and, when issued and delivered to
the Underwriter against payment therefor in accordance with the terms hereof,
will be validly issued, fully paid and nonassessable by the Trust and free of
any preemptive or similar rights that entitle or will entitle any person to
acquire any Shares upon the issuance thereof by the Trust, and will conform to
the description thereof in the Registration Statement and the Prospectus; and
the capitalization of the Trust conforms to the description thereof in the
Registration Statement and the Prospectus.
(d) Except as described in the Prospectus, there are no
outstanding options, warrants or other rights calling for the issuance of, or
any commitment, plan or arrangement to issue, any shares of beneficial interest
of the Trust or any security convertible into or exchangeable or exercisable for
shares of beneficial interest of the Trust.
(e) The Trust is a business trust duly organized and validly
existing under the laws of the Commonwealth of Massachusetts with full business
trust power and authority to own, lease and operate its properties and to
conduct its business as described in the Registration Statement and the
Prospectus, and is duly registered and qualified to conduct its business in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification, except where the failure
to so register or qualify does not have a material adverse effect on the
condition (financial or other), business, prospects, properties, net assets or
results of operations of the Trust; and the Trust has no subsidiaries.
(f) There are no legal or governmental proceedings pending or,
to the knowledge of the Trust, threatened, against the Trust, or to which the
Trust or any of its properties is subject, that are required to be described in
the Registration Statement or the Prospectus but are not described as required,
and there are no agreements, contracts, indentures, leases or other instruments
that are required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement that are
not described or filed as required by the 1933 Act, the 1940 Act or the Rules
and Regulations.
(g) The Trust is not in violation of its Agreement and
Declaration of Trust (the "Declaration"), including the Certificate, or bylaws
(the "Bylaws"), or other organizational documents or of any law, ordinance,
administrative or governmental rule or regulation applicable to the Trust or of
any decree of the Commission, the NASD, any state securities commission, any
national securities exchange, any arbitrator, any court or governmental agency,
body or official having jurisdiction over the Trust, or in default in the
performance of any material obligation, agreement or condition contained in any
bond, debenture, note or any other evidence of
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indebtedness or in any material agreement, indenture, lease or other instrument
to which the Trust is a party or by which it or any of its properties may be
bound.
(h) Neither the issuance and sale of the Shares, the execution,
delivery or performance of this Agreement or any of the Trust Agreements by the
Trust, nor the consummation by the Trust of the transactions contemplated hereby
or thereby (A) requires any consent, approval, authorization or other order of,
or registration or filing with, the Commission, the NASD, any state securities
commission, any national securities exchange, any arbitrator, any court,
regulatory body, administrative agency or other governmental body, agency or
official (except such as may have been obtained prior to the date hereof and
such as may be required for compliance with the state securities or blue sky
laws of various jurisdictions which have been or will be effected in accordance
with this Agreement) or conflicts or will conflict with or constitutes or will
constitute a breach of, or a default under, the Declaration, including the
Certificate, the Bylaws or other organizational documents of the Trust or (B)
conflicts or will conflict with or constitutes or will constitute a breach of,
or a default under, any agreement, indenture, lease or other instrument to which
the Trust is a party or by which it or any of its properties may be bound, or
violates or will violate any statute, law, regulation or judgment, injunction,
order or decree applicable to the Trust or any of its properties, or will result
in the creation or imposition of any material lien, charge or encumbrance upon
any property or assets of the Trust pursuant to the terms of any agreement or
instrument to which it is a party or by which it may be bound or to which any of
its properties or assets is subject. The Trust is not subject to any order of
any court or of any arbitrator, governmental authority or administrative agency.
(i) The financial statements, together with related schedules
and notes, included or incorporated by reference in the Registration Statement
and the Prospectus, present fairly the financial position, results of operations
and changes in financial position of the Trust on the basis stated or
incorporated by reference in the Registration Statement at the respective dates
or for the respective periods to which they apply; such statements and related
schedules and notes have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods involved,
except as disclosed therein; and the other financial and statistical information
and data included in the Registration Statement and the Prospectus are
accurately presented and prepared on a basis consistent with such financial
statements and the books and records of the Trust.
(j) The execution and delivery of, and the performance by the
Trust of its obligations under, this Agreement and the Trust Agreements have
been duly and validly authorized by the Trust, and this Agreement and the Trust
Agreements have been duly executed and delivered by the Trust and each
constitutes the valid and legally binding agreement of the Trust, enforceable
against the Trust in accordance with its terms, except as rights to indemnity
and contribution hereunder and thereunder may be limited by federal or state
securities laws and subject to the qualification that the enforceability of the
Trust's obligations hereunder and thereunder may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization,
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moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles.
(k) Except as disclosed in the Registration Statement and the
Prospectus, subsequent to the respective dates as of which such information is
given in the Registration Statement and the Prospectus (or any amendment or
supplement to either of them), the Trust has not incurred any liability or
obligation, direct or contingent, or entered into any transaction, not in the
ordinary course of business, that is material to the Trust, and there has not
been any change in the capitalization, or material increase in the short-term
debt or long-term debt, of the Trust, or any material adverse change, or any
development involving or which may reasonably be expected to involve, a
prospective material adverse change, in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the
Trust, whether or not arising in the ordinary course of business.
(l) The Trust has not distributed and, prior to the later to
occur of (i) the Closing Date and (ii) completion of the distribution of the
Shares, will not distribute any offering material in connection with the
offering and sale of the Shares other than the Registration Statement, the
Prepricing Prospectus, the Prospectus or other materials, if any, permitted by
the 1933 Act, the 1940 Act or the Rules and Regulations.
(m) The Trust has such permits, licenses, franchises and
authorizations of governmental or regulatory authorities ("permits") as are
necessary to own its properties and to conduct its business in the manner
described in the Prospectus, subject to such qualifications as may be set forth
in the Prospectus; the Trust has fulfilled and performed all its material
obligations with respect to such permits and no event has occurred which allows,
or after notice or lapse of time would allow, revocation or termination thereof
or results in any other material impairment of the rights of the Trust under any
such permit, subject in each case to such qualification as may be set forth in
the Prospectus; and, except as described in the Prospectus, none of such permits
contains any restriction that is materially burdensome to the Trust.
(n) The Trust maintains 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 and with the
applicable requirements of the 1940 Act, the 1940 Act Rules and Regulations and
the Internal Revenue Code of 1986, as amended (the "Code"); (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 and to maintain compliance with the books and records
requirements under the 1940 Act and the 1940 Act Rules and Regulations; (iii)
access to assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
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(o) The Trust has filed all tax returns required to be filed,
which returns are complete and correct in all material respects, and the Trust
is not in material default in the payment of any taxes which were payable
pursuant to said returns or any assessments with respect thereto.
(p) No holder of any security of the Trust has any right to
require registration of shares of beneficial interest, shares of Municipal
Preferred or any other security of the Trust because of the filing of the
registration statement or consummation of the transactions contemplated by this
Agreement.
(q) The Trust, subject to the registration statement having been
declared effective and the filing of the Prospectus under Rule 497 under the
1933 Act Rules and Regulations, has taken all required action under the 1933
Act, the 1940 Act and the Rules and Regulations to make the public offering and
consummate the sale of the Shares as contemplated by this Agreement.
(r) The Trust is registered under the 1940 Act and the 1940 Act
Rules and Regulations as a closed-end, non-diversified management investment
company and the 1940 Act. Notification has been duly filed with the Commission
and, at the time of filing thereof and any amendment or supplement thereto,
conformed in all material respects with all applicable provisions of the 1940
Act and the 1940 Act Rules and Regulations; no order of suspension or revocation
of such registration under the 1940 Act and the 1940 Act Rules and Regulations
has been issued or proceedings therefor initiated or threatened by the
Commission. The provisions of the Declaration, including the Certificate, and
Bylaws, and the investment policies and restrictions described in the
Registration Statement and the Prospectus under the captions "Prospectus
Summary," "Investment Objective, Policies and Risks," "Additional Information
About Investments and Investment Techniques" and "Investment Restrictions" (in
the prospectus and the statement of additional information) comply in all
material respects with the requirements of the 1940 Act and the 1940 Act Rules
and Regulations. The Trust is, and at all times through the completion of the
transactions contemplated hereby, will be, in compliance in all material
respects with the terms and conditions of the 1933 Act and the 1940 Act. No
person is serving or acting as an officer, director or investment adviser of the
Trust except in accordance with the provisions of the 1940 Act and the 1940 Act
Rules and Regulations and the Investment Advisers Act of 1940, as amended (the
"Advisers Act"), and the rules and regulations of the Commission promulgated
under the Advisers Act (the "Advisers Act Rules and Regulations").
(s) Except as stated in this Agreement and in the Prospectus,
the Trust has not taken, nor will it take, directly or indirectly, any action
designed to or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any securities issued by the Trust
to facilitate the sale or resale of the Shares, and the Trust is not aware of
any such action taken or to be taken by any affiliates of the Trust.
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(t) The Trust has filed in a timely manner each document or
report required to be filed by it pursuant to the 1934 Act and the rules and
regulations of the Commission promulgated thereunder (the "1934 Act Rules and
Regulations"); each such document or report at the time it was filed conformed
to the requirements of the 1934 Act and the 1934 Act Rules and Regulations; and
none of such documents or reports contained an untrue statement of any material
fact or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading.
(u) All advertising, sales literature or other promotional
material (including "prospectus wrappers," "broker kits," "road show slides" and
"road show scripts") authorized in writing by or prepared by the Trust or the
Adviser for use in connection with the offering and sale of the Shares
(collectively, "sales material") complied and comply in all material respects
with the applicable requirements of the 1933 Act, the 1940 Act, the Rules and
Regulations and the rules and interpretations of the NASD and no such sales
material contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading.
(v) Each of the Trust Agreements complies in all material
respects with all applicable provisions of the 1933 Act, the 1940 Act, the Rules
and Regulations, the Advisers Act and the Advisers Act Rules and Regulations.
(w) As required by Subchapter M of the Code, the Trust is
currently in compliance with the requirements to qualify as a regulated
investment company under the Code.
(x) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement to either of them), no trustee of the
Trust is an "interested person" (as defined in the 1940 Act) of the Trust or an
"affiliated person" (as defined in the 1940 Act) of the Underwriter.
(y) The Trust's Common Shares (as defined in the Prospectus) are
duly listed on the NYSE.
(z) The Trust is in compliance with the Commission's Release No.
33-7558 dated July 29, 1998 related to Year 2000 compliance.
(ii) The Adviser represents and warrants to the Underwriter
that, with respect to the Trust:
(a) Each Prepricing Prospectus included as part of the
registration statement as originally filed or as part of any amendment or
supplement thereto, or filed pursuant to Rule 497 of the 1933 Act Rules and
Regulations, complied when so filed in all material respects with the provisions
of the 1933 Act, the 1940 Act and the Rules and Regulations. The Commission has
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not issued any order preventing or suspending the use of any Prepricing
Prospectus or the Prospectus.
(b) The registration statement in the form in which it became or
becomes effective and also in such form as it may be when any post-effective
amendment thereto shall become effective and the Prospectus and any supplement
or amendment thereto when filed with the Commission under Rule 497 of the 1933
Act Rules and Regulations and the 1940 Act Notification when originally filed
with the Commission and any amendment or supplement thereto when filed with the
Commission, complied or will comply in all material respects with the
requirements of the 1933 Act, the 1940 Act and the Rules and Regulations and did
not or will not at any such times contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading, except that this
representation and warranty does not apply to statements in or omissions from
the registration statement or the Prospectus made in reliance upon and in
conformity with information relating to the Underwriter furnished to the Trust
in writing by or on behalf of the Underwriter expressly for use therein.
(c) To the best knowledge of the Adviser, after reasonable
inquiry, there are no legal or governmental proceedings pending or, to the
knowledge of the Adviser, threatened, against the Trust, or to which the Trust
or any of its properties is subject, that are required to be described in the
Registration Statement or the Prospectus but are not described as required, and
there are no agreements, contracts, indentures, leases or other instruments that
are required to be described in the Registration Statement or the Prospectus or
to be filed as an exhibit to the Registration Statement that are not described
or filed as required by the 1933 Act, the 1940 Act or the Rules and Regulations.
(d) To the best knowledge of the Adviser, after reasonable
inquiry, the Trust is not in violation of the Declaration, including the
Certificate, or Bylaws, or other organizational documents or of any law,
ordinance, administrative or governmental rule or regulation applicable to the
Trust or of any decree of the Commission, the NASD, any state securities
commission, any national securities exchange, any arbitrator, any court or
governmental agency, body or official having jurisdiction over the Trust, or in
default in the performance of any material obligation, agreement or condition
contained in any bond, debenture, note or any other evidence of indebtedness or
in any material agreement, indenture, lease or other instrument to which the
Trust is a party or by which it or any of its properties may be bound.
(e) Except as disclosed in the Registration Statement and the
Prospectus, subsequent to the respective dates as of which such information is
given in the Registration Statement and the Prospectus, the Trust has not
incurred any liability or obligation, direct or contingent, or entered into any
transaction, not in the ordinary course of business, that is material to the
Trust, and there has not been any change in the capitalization, or material
increase in the short-term debt or long-term debt, of the Trust, or any material
adverse change, or any
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development involving or which may reasonably be expected to involve, a
prospective material adverse change, in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the
Trust, whether or not arising in the ordinary course of business.
(f) The Trust maintains 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 and with the
applicable requirements of the 1940 Act, the 1940 Act Rules and Regulations and
the Code; (ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting principles
and to maintain accountability for assets and to maintain compliance with the
books and records requirements under the 1940 Act and the 1940 Act Rules and
Regulations; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
(g) The Trust has filed all tax returns required to be filed,
which returns are complete and correct in all material respects, and the Trust
is not in material default in the payment of any taxes which were payable
pursuant to said returns or any assessments with respect thereto.
(h) The Trust, subject to the registration statement having been
declared effective and the filing of the Prospectus under Rule 497 under the
1933 Act Rules and Regulations, has taken all required action under the 1933
Act, the 1940 Act and the Rules and Regulations to make the public offering and
consummate the sale of the Shares as contemplated by this Agreement.
(i) The Trust has not distributed and, prior to the later to
occur of (i) the Closing Date and (ii) completion of the distribution of the
Shares, will not distribute any offering material in connection with the
offering and sale of the Shares other than the Registration Statement, the
Prepricing Prospectus, the Prospectus or other materials, if any, permitted by
the 1933 Act, the 1940 Act or the Rules and Regulations.
(j) Except as stated in this Agreement and in the Prospectus,
the Trust has not taken, nor will it take, directly or indirectly, any action
designed to or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any securities issued by the Trust
to facilitate the sale or resale of the Shares to the extent such action is
within the control of the Adviser, and the Adviser is not aware of any such
action taken or to be taken by any affiliates of the Trust.
(k) To the best knowledge of the Adviser, after reasonable
inquiry, the Trust has filed in a timely manner each document or report required
to be filed by it pursuant to the 1934 Act and the 1934 Act Rules and
Regulations; to the extent the Adviser has participated in the preparation of
such documents or reports, each such document or report at the time it was
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filed conformed to the requirements of the 1934 Act and the 1934 Act Rules and
Regulations; and to the extent the Adviser has participated in the preparation
of such documents or reports, none of such documents or reports contained an
untrue statement of any material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading.
(l) Each of the Trust Agreements complies in all material
respects with all applicable provisions of the 1933 Act, the 1940 Act, the Rules
and Regulations, the Advisers Act and the Advisers Act Rules and Regulations.
(m) To the best knowledge of the Adviser, after reasonable
inquiry, except as disclosed in the Registration Statement and the Prospectus,
no trustee of the Trust is an "interested person" (as defined in the 1940 Act)
of the Trust or an "affiliated person" (as defined in the 1940 Act) of the
Underwriter.
(n) To the best knowledge of the Adviser, after reasonable
inquiry, the Trust is in compliance with the Commission's Release No. 33-7558,
dated July 29, 1998 related to Year 2000 compliance.
7. Representations and Warranties of the Adviser. The Adviser
represents and warrants to the Underwriter that:
(a) The Adviser is a corporation duly incorporated and validly
existing in good standing under the laws of the State of Delaware, with full
corporate power and authority to conduct its business as described in the
Registration Statement and the Prospectus, and is duly registered and qualified
to conduct its business and is in good standing in each jurisdiction or place
where the nature of its properties or the conduct of its business requires such
registration or qualification, except where the failure to so register or to
qualify does not have a material adverse effect on the condition (financial or
other), business, prospects, properties, net assets or results of operations of
the Adviser or on the ability of the Adviser to perform its obligations under
this Agreement and the Investment Management Agreement.
(b) The Adviser is duly registered with the Commission as an
investment adviser under the Advisers Act and is not prohibited by the Advisers
Act, the Advisers Act Rules and Regulations, the 1940 Act or the 1940 Act Rules
and Regulations from acting under the Investment Management Agreement for the
Trust as contemplated by the Prospectus. To the best knowledge of the Adviser,
after reasonable inquiry, there does not exist any proceeding or any facts or
circumstances the existence of which could lead to any proceeding which might
adversely affect the registration of the Adviser with the Commission.
(c) To the best knowledge of the Adviser, after reasonable
inquiry, there are no legal or governmental proceedings pending or, to the
knowledge of the Adviser, threatened against the Adviser, or to which the
Adviser or any of its properties is subject, that are required to
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be described in the Registration Statement or the Prospectus but are not
described as required or that may reasonably be expected to involve a
prospective material adverse change, in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the
Adviser or on the ability of the Adviser to perform its obligations under this
Agreement and the Investment Management Agreement.
(d) To the best knowledge of the Adviser after reasonable
inquiry, neither the execution, delivery or performance of this Agreement or the
Investment Management Agreement by the Adviser, nor the consummation by the
Adviser of the transactions contemplated hereby or thereby (A) requires the
Adviser to obtain any consent, approval, authorization or other order of, or
registration or filing with, the Commission, the NASD, any state securities
commission, any national securities exchange, any arbitrator, any court,
regulatory body, administrative agency or other governmental body, agency or
official or conflicts or will conflict with or constitutes or will constitute a
breach of or a default under, the certificate of incorporation or bylaws, or
other organizational documents, of the Adviser, except where the failure to
obtain such consent, approval, authorization or other order of, or make such
registration or filing, or such conflict, breach or default, would not have a
material adverse effect on the condition (financial or other), business,
prospects, properties, net assets or results of operations of the Adviser or on
the ability of the Adviser to perform its obligations under this Agreement and
the Investment Management Agreement or (B) conflicts or will conflict with or
constitutes or will constitute a breach of or a default under, any agreement,
indenture, lease or other instrument to which the Adviser is a party or by which
it or any of its properties may be bound, or violates or will violate any
statute, law, regulation or judgment, injunction, order or decree applicable to
the Adviser or any of its properties or will result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Adviser pursuant to the terms of any agreement or instrument to which it is a
party or by which it may be bound or to which any of the property or assets of
the Adviser is subject, except where such conflict, breach, default or violation
would not have a material adverse effect on the condition (financial or other),
business, prospects, properties, net assets or results of operations of the
Adviser or on the ability of the Adviser to perform its obligations under this
Agreement and the Investment Management Agreement. The Adviser is not subject to
any order of any court or of any arbitrator, governmental authority or
administrative agency, except such orders which do not have a material adverse
effect on the condition (financial or other), business, prospects, properties,
net assets or results of operations of the Adviser or on the ability of the
Adviser to perform its obligations under this Agreement and the Investment
Management Agreement.
(e) The execution and delivery of, and the performance by the
Adviser of its obligations under, this Agreement and the Investment Management
Agreement have been duly and validly authorized by the Adviser, and this
Agreement and the Investment Management Agreement have been duly executed and
delivered by the Adviser and each constitutes the valid and legally binding
agreement of the Adviser, enforceable against the Adviser in accordance with its
terms, except as rights to indemnity and contribution hereunder may be limited
by federal or state securities laws.
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(f) The description of the Adviser in the Registration Statement
and the Prospectus complied and comply in all material respects with the
provisions of the 1933 Act, the 1940 Act, the Advisers Act, the Rules and
Regulations and the Advisers Act Rules and Regulations and did not and will not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(g) Except as disclosed in the Registration Statement and the
Prospectus, subsequent to the respective dates as of which such information is
given in the Registration Statement and the Prospectus, the Adviser has not
incurred any liability or obligation, direct or contingent, or entered into any
transaction, not in the ordinary course of business, that is material to the
Adviser or the Trust, and there has not been any material adverse change, or any
development involving or which may reasonably be expected to involve, a
prospective material adverse change, in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the
Adviser, whether or not arising in the ordinary course of business, or which, in
each case, could have a material adverse effect on the ability of the Adviser to
perform its obligations under this Agreement and the Investment Management
Agreement.
(h) The Adviser has such permits, licenses, franchises and
authorizations of governmental or regulatory authorities ("permits") as are
necessary to own its properties and to conduct its business in the manner
described in the Prospectus, except such permits the lack of which would not
have a material adverse effect on the condition (financial or other), business,
prospects, properties, net assets or results of operations of the Adviser or on
the ability of the Adviser to perform its obligations under this Agreement and
the Investment Management Agreement; the Adviser has fulfilled and performed all
its material obligations with respect to such permits and no event has occurred
which allows, or after notice or lapse of time would allow, revocation or
termination thereof or results in any other material impairment of the rights of
the Adviser under any such permit; and, except as described in the Prospectus,
none of such permits contains any restriction that is materially burdensome to
the Adviser.
(i) Except as stated in this Agreement and in the Prospectus,
the Adviser has not taken, nor will it take, directly or indirectly, any action
designed to or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any securities issued by the Trust
to facilitate the sale or resale of the Shares, and the Adviser is not aware of
any such action taken or to be taken by any affiliates of the Adviser.
8. Indemnification and Contribution.
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(a)(i) The Trust agrees to indemnify and hold harmless each of
the Underwriter and each person, if any, who controls the Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act from and
against any and all losses, claims, damages, liabilities and expenses (including
reasonable costs of investigation), joint or several, arising out of or based
upon any untrue statement or alleged untrue statement of a material fact
contained in any Prepricing Prospectus or in the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or arising out of or based
upon any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to the Underwriter
furnished in writing to the Trust by or on behalf of the Underwriter expressly
for use in connection therewith; provided, however, that the indemnification
contained in this paragraph (a)(i) with respect to any Prepricing Prospectus
shall not inure to the benefit of the Underwriter (or to the benefit of any
person controlling the Underwriter) on account of any such loss, claim, damage,
liability or expense arising from the sale of the Shares by the Underwriter to
any person if a copy of the Prospectus shall not have been delivered or sent to
such person within the time required by the 1933 Act and the 1933 Act Rules and
Regulations, and the untrue statement or alleged untrue statement or omission or
alleged omission of a material fact contained in such Prepricing Prospectus was
corrected in the Prospectus, provided that the Trust has delivered the
Prospectus to the Underwriter in requisite quantity on a timely basis to permit
such delivery or sending. The foregoing indemnity agreement shall be in addition
to any liability which the Trust may otherwise have.
(ii) The Adviser agrees to indemnify and hold harmless each of
the Underwriter and each person, if any, who controls the Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act from and
against any and all losses, claims, damages, liabilities and expenses (including
reasonable costs of investigation), joint or several, arising out of or based
upon any untrue statement or alleged untrue statement of a material fact
contained in any Prepricing Prospectus or in the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or arising out of or based
upon any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to the Underwriter
furnished in writing to the Trust by or on behalf of the Underwriter expressly
for use in connection therewith; provided, however, that the indemnification
contained in this paragraph (a)(ii) with respect to any Prepricing Prospectus
shall not inure to the benefit of the Underwriter (or to the benefit of any
person controlling the Underwriter) on account of any such loss, claim, damage,
liability or expense arising from the sale of the Shares by the Underwriter to
any person if a copy of the Prospectus shall not have been delivered or sent to
such person within the time required by the 1933 Act and the 1933 Act Rules and
Regulations, and the untrue statement or alleged untrue statement or omission or
alleged
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omission of a material fact contained in such Prepricing Prospectus was
corrected in the Prospectus, provided that the Trust has delivered the
Prospectus to the Underwriter in requisite quantity on a timely basis to permit
such delivery or sending; and provided further, that (i) the Adviser will not be
liable to any such indemnified party in any such case except to the extent that
the Trust has failed to indemnify and hold harmless such indemnified party
pursuant to paragraph (a)(i) in respect of any such loss, claim, damage,
liability or expense after such indemnified party has made a claim of the Trust
as required below; and (ii) the amount of the Adviser's liability hereunder
shall be limited to the amount of the net proceeds from the sale of the Shares.
This indemnity agreement shall be in addition to any liability which the Adviser
may otherwise have.
(b) If any action, suit or proceeding shall be brought against
the Underwriter or any person controlling the Underwriter in respect of which
indemnity may be sought against the Trust or the Adviser, the Underwriter or
such controlling person shall promptly notify the Trust or the Adviser, and the
Trust or the Adviser shall assume the defense thereof, including the employment
of counsel and payment of all fees and expenses. The Underwriter or any such
controlling person shall have the right to employ separate counsel in any such
action, suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of the Underwriter or
such controlling person unless (i) the Trust or the Adviser has agreed in
writing to pay such fees and expenses, (ii) the Trust and the Adviser have
failed to assume the defense and employ counsel, or (iii) the named parties to
any such action, suit or proceeding (including any impleaded parties) include
both the Underwriter or such controlling person and the Trust or the Adviser and
the Underwriter or such controlling person shall have been advised by its
counsel that representation of such indemnified party and the Trust or the
Adviser by the same counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same counsel has
been proposed) due to actual or potential differing interests between them (in
which case the Trust and the Adviser shall not have the right to assume the
defense of such action, suit or proceeding on behalf of the Underwriter or such
controlling person). It is understood, however, that the Trust and the Adviser
shall, in connection with any one such action, suit or proceeding or separate
but substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for the Underwriter and
controlling persons not having actual or potential differing interests with you
or among themselves, which firm shall be designated in writing by the
Underwriter, and that all such fees and expenses shall be reimbursed as they are
incurred. The Trust and the Adviser shall not be liable for any settlement of
any such action, suit or proceeding effected without their written consent, but
if settled with such written consent, or if there be a final judgment for the
plaintiff in any such action, suit or proceeding, the Trust and the Adviser
agree to indemnify and hold harmless the Underwriter, to the extent provided in
the preceding paragraph, and any such controlling person from and against any
loss, claim, damage, liability or expense by reason of such settlement or
judgment.
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(c) The Underwriter agrees to indemnify and hold harmless the
Trust and the Adviser, their directors and trustees, any officers who sign the
Registration Statement, and any person who controls the Trust or the Adviser
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act,
to the same extent as the foregoing indemnity from the Trust and the Adviser to
the Underwriter, but only with respect to information relating to the
Underwriter furnished in writing by or on behalf of the Underwriter expressly
for use in the Registration Statement, the Prospectus or any Prepricing
Prospectus, or any amendment or supplement thereto. If any action, suit or
proceeding shall be brought against the Trust or the Adviser, any of their
directors or trustees, any such officer, or any such controlling person based on
the Registration Statement, the Prospectus or any Prepricing Prospectus, or any
amendment or supplement thereto, and in respect of which indemnity may be sought
against the Underwriter pursuant to this paragraph (c), the Underwriter shall
have the rights and duties given to the Trust and the Adviser by paragraph (b)
above (except that if the Trust or the Adviser shall have assumed the defense
thereof the Underwriter shall not be required to do so, but may employ separate
counsel therein and participate in the defense thereof, but the fees and
expenses of such counsel shall be at the Underwriter's expense), and the Trust
and the Adviser, their directors and trustees, any such officer, and any such
controlling person shall have the rights and duties given to the Underwriter by
paragraph (b) above. The foregoing indemnity agreement shall be in addition to
any liability which the Underwriter may otherwise have.
(d) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Trust and the Adviser on the one hand (treated jointly for this purpose as one
person) and the Underwriter 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 Trust and the Adviser on the one hand (treated jointly for this purpose as
one person) and the Underwriter on the other in connection with the statements
or omissions that resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Trust and the Adviser on the one hand (treated jointly
for this purpose as one person) and the Underwriter on the other shall be deemed
to be in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Trust bear to the total underwriting
discounts and commissions received by the Underwriter, in each case as set forth
in the table on the cover page of the Prospectus. The relative fault of the
Trust and the Adviser on the one hand (treated jointly for this purpose as one
person) and the Underwriter on the other hand shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Trust and the Adviser on the one hand
(treated jointly for this purpose as one
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person) or by the Underwriter on the other hand and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
(e) The Trust, the Adviser and the Underwriter agree that it
would not be just and equitable if contribution pursuant to this Section 8 were
determined by a pro rata allocation or by any other method of allocation that
does not take account of the equitable considerations referred to in paragraph
(d) above. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities and expenses referred to in paragraph (d)
above shall be deemed to include, subject to the limitations set forth above,
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 8, the Underwriter
shall not be required to contribute any amount in excess of the amount by which
the total price of the Shares underwritten by it and distributed to the public
exceeds the amount of any damages which the Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
(f) No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been sought hereunder by
such indemnified party, unless such settlement includes an unconditional release
of such indemnified party from all liability on claims that are the subject
matter of such action, suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution under
this Section 8 shall be paid by the indemnifying party to the indemnified party
as such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 8 and the
representations and warranties of the Trust and the Adviser set forth in this
Agreement shall remain operative and in full force and effect, regardless of (i)
any investigation made by or on behalf of the Underwriter or any person
controlling the Underwriter, the Trust, the Adviser, their directors, trustees
or officers, or any person controlling the Trust or the Adviser, (ii) acceptance
of any Shares and payment therefor hereunder, and (iii) any termination of this
Agreement. A successor to the Underwriter or any person controlling the
Underwriter, or to the Trust, the Adviser, their directors, trustees or
officers, or any person controlling the Trust or the Adviser, shall be entitled
to the benefits of the indemnity, contribution, and reimbursement agreements
contained in this Section 8.
9. Conditions of Underwriter's Obligations. The obligation of
the Underwriter to purchase the Shares hereunder are subject to the following
conditions:
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(a) If, at the time this Agreement is executed and delivered, it
is necessary for the registration statement or a post-effective amendment
thereto to be declared effective before the offering of the Shares may commence,
the registration statement or such post-effective amendment shall have become
effective not later than 5:30 P.M., New York City time, on the date hereof, or
at such later date and time as shall be consented to in writing by the
Underwriter, and all filings, if any, required by Rules 497 and 430A under the
1933 Act and the 1933 Act Rules and Regulations shall have been timely made; no
stop order suspending the effectiveness of the Registration Statement or order
pursuant to Section 8(e) of the 1940 Act shall have been issued and no
proceeding for those purposes shall have been instituted or, to the knowledge of
the Trust, the Adviser or the Underwriter, threatened by the Commission, and any
request of the Commission for additional information (to be included in the
registration statement or the prospectus or otherwise) shall have been complied
with to the Underwriter's satisfaction.
(b) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any change or any development involving a
prospective change in or affecting the condition (financial or other), business,
prospects, properties, net assets, or results of operations of the Trust or the
Adviser not contemplated by the Prospectus, which in the Underwriter's opinion
would materially, adversely affect the market for the Shares, or (ii) any event
or development relating to or involving the Trust or the Adviser or any officer
or director of the Trust or the Adviser which makes any statement made in the
Prospectus untrue or which, in the opinion of the Trust and its counsel or the
Underwriter and its counsel, requires the making of any addition to or change in
the Prospectus in order to state a material fact required by the 1933 Act, the
1940 Act or the Rules and Regulations or any other law to be stated therein or
necessary in order to make the statements therein not misleading, if amending or
supplementing the Prospectus to reflect such event or development would, in the
Underwriter's opinion, materially adversely affect the market for the Shares.
(c) The Trust shall have furnished to you a report showing
compliance with the asset coverage requirements of the 1940 Act and a Municipal
Preferred Basic Maintenance Report (as defined in the Certificate), each dated
the Closing Date and in form and substance satisfactory to you. Each such report
may use portfolio holdings and valuations as of the close of business of any day
not more than six business days preceding the Closing Date, provided, however,
that the Trust represents in such report that its total net assets as of the
Closing Date have not declined by 5% or more from such valuation date.
(d) The Underwriter shall have received on the Closing Date an
opinion of Dechert Price & ▇▇▇▇▇▇, special counsel for the Trust, dated the
Closing Date and addressed to the Underwriter, in form and substance
satisfactory to the Underwriter and to the effect that:
(i) The Trust is a business trust duly organized and validly existing under
the laws of the Commonwealth of Massachusetts with full business trust power and
authority to own, lease and operate its properties and to conduct its business
as described in the Registration Statement and the Prospectus, and is duly
registered and qualified to conduct its business in each jurisdiction or
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place where the nature of its properties or the conduct of its business requires
such registration or qualification, except where the failure to so register or
qualify does not have a material adverse effect on the condition (financial or
other), business, prospects, properties, net assets or results of operations of
the Trust;
(ii) The Trust has no subsidiaries;
(iii) The authorized and outstanding capitalization of the Trust is as set
forth under the caption "Capitalization" in the Prospectus; and the authorized
capitalization of the Trust conforms in all material respects as to legal
matters to the description thereof contained in the Prospectus under the caption
"Description of Capital Structure";
(iv) All the shares of beneficial interest of the Trust outstanding prior
to the issuance of the Shares have been duly authorized and validly issued, and
are fully paid and nonassessable;
(v) The Shares have been duly authorized and, when issued and delivered to
the Underwriter against payment therefor in accordance with the terms hereof,
will be validly issued, fully paid and nonassessable and free of any preemptive,
or to the best knowledge of such counsel after reasonable inquiry, similar
rights that entitle or will entitle any person to acquire any Shares upon the
issuance thereof by the Trust, and will conform to the description thereof
contained in the Prospectus under the caption "Description of Municipal
Preferred";
(vi) The form of certificates for the Shares conforms to the requirements
of Massachusetts law;
(vii) The Registration Statement and all post-effective amendments, if any,
have become effective under the 1933 Act and the 1933 Act Rules and Regulations
and, to the best knowledge of such counsel after reasonable inquiry, no stop
order suspending the effectiveness of the Registration Statement or order
pursuant to Section 8(e) of the 1940 Act has been issued and no proceedings for
that purpose are pending before or contemplated by the Commission; and any
required filing of the Prospectus pursuant to Rule 497 of the 1933 Act Rules and
Regulations has been made in accordance with Rule 497;
(viii) The Trust has business trust power and authority to enter into this
Agreement and each of the Trust Agreements and to issue, sell and deliver the
Shares to the Underwriter as provided herein, and this Agreement and each of the
Trust Agreements have been duly authorized, executed and delivered by the Trust
and, assuming due authorization, execution and delivery by the other parties
thereto, each is a valid and legally binding agreement of the Trust, enforceable
against the Trust in accordance with its terms, except as rights to indemnity
and contribution hereunder and thereunder may be limited by Federal or state
securities laws or principles of public policy and subject to the qualification
that the enforceability of the Trust's obligations hereunder and thereunder may
be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, and other laws relating to or affecting creditors' rights generally
and by general equitable principles;
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(ix) To the best knowledge of such counsel, after reasonable inquiry, the
Trust is not in violation of the Declaration, including the Certificate, or
Bylaws, or other organizational documents, and is not in default in the
performance of any material obligation, agreement or condition contained in any
bond, debenture, note or other evidence of indebtedness, or in any material
agreement, indenture, lease or other instrument to which the Trust is a party or
by which it or any of its properties may be bound, except as may be disclosed in
the Prospectus;
(x) Neither the offer, sale or delivery of the Shares, the execution,
delivery or performance of this Agreement and the Trust Agreements by the Trust,
nor the consummation by the Trust of the transactions contemplated hereby and
thereby conflicts or will conflict with or constitutes or will constitute a
breach of, or a default under, the Declaration, including the Certificate, or
Bylaws, or other organizational documents, of the Trust or any agreement,
indenture, lease or other instrument to which the Trust is a party or by which
it or any of its properties is bound, nor will any such action result in any
violation of any statute, law, regulation or judgement (assuming compliance with
all applicable state securities or blue sky laws), injunction, order or decree
applicable to the Trust or any of its properties;
(xi) No consent, approval, authorization or other order of, or registration
or filing with, the Commission, the NASD, or, to the best of such counsel's
knowledge after reasonable inquiry, any state securities commission, any
arbitrator, any court, regulatory body, administrative agency or other
governmental body, agency, or official is required on the part of the Trust
(except such as may have been obtained prior to the date hereof and such as may
be required by the New York Stock Exchange, or for compliance with the state
securities or blue sky laws of various jurisdictions) for the valid issuance and
sale of the Shares to the Underwriter as contemplated by this Agreement, the
execution, delivery and performance by the Trust of this Agreement and the Trust
Agreements or the consummation of the transactions contemplated hereby and
thereby;
(xii) The 1940 Act Notification, the Registration Statement, the Prospectus
and any supplements or amendments thereto (except for the financial statements
and the notes thereto and the schedules and other financial and statistical data
included therein, as to which such counsel need not express any opinion) comply
in all material respects with the requirements of the 1933 Act, the 1940 Act and
the Rules and Regulations;
(xiii) To the best knowledge of such counsel after reasonable inquiry, (A)
other than as described in the Registration Statement or Prospectus, there are
no legal or governmental proceedings pending or threatened against the Trust, or
to which the Trust or any of its properties is subject, which are required to be
described in the Registration Statement or Prospectus and (B) there are no
agreements, contracts, indentures, leases or other instruments that are required
to be described in the Registration Statement or the Prospectus or to be filed
as an exhibit to the Registration Statement that are not described or filed as
required, as the case may be;
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(xiv) To the best knowledge of such counsel after reasonable inquiry, the
Trust is not in violation of any law, ordinance, administrative or governmental
rule or regulation applicable to the Trust or of any decree of the Commission,
the NASD, any state securities commission, any national securities exchange, any
arbitrator, any court or governmental agency, body or official having
jurisdiction over the Trust; (xv) The statements in the Registration Statement
and Prospectus, insofar as they are descriptions of contracts, agreements or
other legal documents, or refer to statements of law or legal conclusions, are
accurate and present fairly the information required to be shown;
(xvi) Each of this Agreement and the Trust Agreements complies in all
material respects with all applicable provisions of the 1933 Act, the 1940 Act,
the Advisers Act, the Rules and Regulations and the Advisers Act Rules and
Regulations;
(xvii) The Trust is duly registered with the Commission under the 1940 Act
and the 1940 Act Rules and Regulations as a closed-end, non-diversified
management investment company and, to the best knowledge of such counsel after
reasonable inquiry, no order of suspension or revocation of such registration
under the 1940 Act and the 1940 Act Rules and Regulations has been issued or
proceedings therefor initiated or threatened by the Commission; and the Trust
has taken all required action under the 1933 Act and the 1940 Act and the Rules
and Regulations to make the public offering and consummate the sale of the
Shares as contemplated by this Agreement;
(xviii) Except as described in the Prospectus, there are no outstanding
options, warrants or other rights calling for the issuance of, and such counsel
does not know of any commitment, plan or arrangement to issue, any shares of
beneficial interest of the Trust or any security convertible into or
exchangeable or exercisable for shares of beneficial interest of the Trust; and
no holder of any security of the Trust has any right to require registration of
shares of beneficial interest, shares of Municipal Preferred or any other
security of the Trust because of the filing of the registration statement or
consummation of the transactions contemplated by this Agreement; and
(xix) Such counsel shall also state that, while they have not themselves
checked the accuracy and completeness of or otherwise verified, and are not
passing upon and assume no responsibility for the accuracy or completeness of,
the statements contained in the Registration Statement or the Prospectus, except
to the limited extent stated in paragraphs (iii) and (xv) above, in the course
of their review and discussion of the contents of the Registration Statement and
Prospectus with certain officers and employees of the Trust and its independent
accountants, no facts have come to their attention which cause them to believe
that the Registration Statement or any amendment or supplement thereto (except
as to any financial statements or other financial data included in the
Registration Statement as to which they express no belief), as of its effective
date, contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
contained therein not misleading or that the Prospectus (except as to any
financial statements or other financial data included in the
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Prospectus, as to which they express no belief), as of its issue date and as of
the Closing Date, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements contained therein, in light of the circumstances under which they
were made, not misleading.
(e) The Underwriter shall have received on the Closing Date an
opinion of ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Adviser, dated the Closing Date
and addressed to the Underwriter, in form and substance satisfactory to the
Underwriter and to the effect that:
(i) The Adviser is a corporation duly incorporated and validly
existing in good standing under the laws of the State of Delaware with full
corporate power and authority to conduct its business as described in the
Registration Statement and the Prospectus, and is duly registered and
qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the conduct of
its business requires such registration or qualification, except where the
failure to so register or qualify does not have a material adverse effect
on the condition (financial or other), business, prospects, properties, net
assets or results of operations of the Adviser, or on the ability of the
Adviser to perform its obligations under this Agreement and the Investment
Management Agreement;
(ii) The Adviser is duly registered with the Commission as an
investment adviser under the Advisers Act and is not prohibited by the
Advisers Act, the Advisers Act Rules and Regulations, the 1940 Act or the
1940 Act Rules and Regulations from acting under the Investment Management
Agreement for the Trust as contemplated by the Prospectus (or any amendment
or supplement thereto); and, to the best knowledge of such counsel after
reasonable inquiry, there does not exist any proceeding or any facts or
circumstances the existence of which could lead to any proceeding which
might adversely affect the registration of the Adviser with the Commission;
(iii) The Adviser has corporate power and authority to enter into this
Agreement and the Investment Management Agreement, and this Agreement and
the Investment Management Agreement have been duly authorized, executed and
delivered by the Adviser and assuming due authorization, execution and
delivery by the other parties thereto, each is a valid and legally binding
agreement of the Adviser, enforceable against the Adviser in accordance
with its terms except as rights to indemnity and contribution hereunder and
thereunder may be limited by Federal or state securities laws or principles
of public policy and subject to the qualification that the enforceability
of the Adviser's obligations hereunder and thereunder may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium,
and other laws relating to or affecting creditors' rights generally and by
general equitable principles;
(iv) To the best knowledge of such counsel after reasonable inquiry,
neither the execution, delivery or performance of this Agreement or the
Investment Management
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Agreement by the Adviser nor the consummation by the Adviser of the
transactions contemplated hereby and thereby conflicts or will conflict
with, or constitutes or will constitute a breach of or default under, the
certificate of incorporation or bylaws, or other organizational documents,
of the Adviser or any agreement, indenture, lease or other instrument to
which the Adviser is a party or by which it or any of its properties is
bound, or will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Adviser, nor will any such
action result in any violation of any existing statute, law, regulation or
judgment, injunction, order or decree applicable to the Adviser or any of
its properties;
(v) To the best knowledge of such counsel after reasonable inquiry, no
consent, approval, authorization or other order of, or registration or
filing with, the Commission, the NASD, any state securities commission, any
arbitrator, any court, regulatory body, administrative agency or other
governmental body, agency, or official is required on the part of the
Adviser for the execution, delivery and performance by it of this Agreement
and the Investment Management Agreement or the consummation by it of the
transactions contemplated hereby and thereby;
(vi) To the best knowledge of such counsel after reasonable inquiry,
there are no legal or governmental proceedings pending or threatened
against the Adviser or to which the Adviser or any of its properties is
subject, which are required to be described in the Registration Statement
or the Prospectus but are not described as required or which may reasonably
be expected to involve a prospective material adverse change in the
condition (financial or other), business, prospects, properties, net assets
or results of operations of the Adviser or on the ability of the Adviser to
perform its obligations under this Agreement and the Investment Management
Agreement;
(vii) The obligations of the Adviser under this Agreement and the
Investment Management Agreement comply in all material respects with all
applicable provisions of the 1940 Act, the 1940 Act Rules and Regulations,
the Advisers Act and the Advisers Act Rules and Regulations;
(viii) The Adviser has full corporate power and authority, and such
permits, licenses, franchises and authorizations of governmental or
regulatory authorities as are necessary to own its properties and to
conduct its business in the manner described in the Prospectus, and to
perform its obligations under the Investment Management Agreement; and
(ix) Such counsel shall also state that the description of the Adviser
contained in the Registration Statement does not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements contained therein not
misleading or that the description of the Adviser contained in the
Prospectus, as of its issue date and as of the Closing Date, does not
contain an untrue
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statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements contained therein, in
light of the circumstances under which they were made, not misleading.
(f) The Underwriter shall have received on the Closing Date an
opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Underwriter, dated the
Closing Date and addressed to the Underwriter, with respect to such matters as
the Underwriter may reasonably request.
(g) The Underwriter shall have received letters addressed to the
Underwriter and dated the date hereof and the Closing Date from Ernst & Young
LLP, independent certified public accountants, substantially in the forms
heretofore approved by the Underwriter. The Underwriter shall also have received
a certification, in form satisfactory to the Underwriter, of Ernst & Young LLP's
status as independent certified public accountants.
(h)(i) No order suspending the effectiveness of the registration
statement or the Registration Statement or prohibiting or suspending the use of
the Prospectus (or any amendment or supplement thereto) or any Prepricing
Prospectus or any sales material shall have been issued and no proceedings for
such purpose or for the purpose of commencing an enforcement action against the
Trust, the Adviser or, with respect to the transactions contemplated by the
Prospectus (or any amendment or supplement thereto) and this Agreement, the
Underwriter, may be pending before or, to the knowledge of the Trust, the
Adviser or the Underwriter or in the reasonable view of counsel to the
Underwriter, shall be threatened or contemplated by the Commission at or prior
to the Closing Date and that any request for additional information on the part
of the Commission (to be included in the Registration Statement, the Prospectus
or otherwise) be complied with to the satisfaction of the Underwriter; (ii)
there shall not have been any change in the capital stock of the Trust nor any
material increase in the short-term or long-term debt of the Trust (other than
in the ordinary course of business) from that set forth or contemplated in the
Registration Statement or the Prospectus (or any amendment or supplement
thereto); (iii) there shall not have been, subsequent to the respective dates as
of which information is given in the Registration Statement and the Prospectus
(or any amendment or supplement thereto), except as may otherwise be stated in
the Registration Statement and Prospectus (or any amendment or supplement
thereto), any material adverse change in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the
Trust or the Adviser; (iv) the Trust shall not have any liabilities or
obligations, direct or contingent (whether or not in the ordinary course of
business), that are material to the Trust, other than those reflected in the
Registration Statement or the Prospectus (or any amendment or supplement to
either of them); and (v) all the representations and warranties of the Trust and
the Adviser contained in this Agreement shall be true and correct on and as of
the date hereof and on and as of the Closing Date as if made on and as of the
Closing Date, and the Underwriter shall have received a certificate of the Trust
and the Adviser, dated the Closing Date and signed by the chief executive
officer and the chief financial officer of each of the Trust and the Adviser (or
such other officers as are acceptable to the Underwriter), to the effect set
forth in this Section 9(h) and in Section 9(i) hereof.
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(i) That neither the Trust nor the Adviser shall have failed at
or prior to the Closing Date to have performed or complied in all material
respects with any of its agreements herein contained and required to be
performed or complied with by it hereunder at or prior to the Closing Date.
(j) The Trust shall have delivered and the Underwriter shall
have received evidence satisfactory to the Underwriter that the shares of each
series of Municipal Preferred are rated 'Aaa' by ▇▇▇▇▇'▇ and AAA by S&P as of
the Closing Date, and there shall not have been given any notice of any intended
or potential downgrading, or of any review for a potential downgrading, in the
rating accorded to the shares of Municipal Preferred by any Rating Agency.
(k) The Trust shall have furnished, in form satisfactory to the
Underwriter, certification that the Trust maintains 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 and with the applicable requirements of the 1940 Act, the 1940 Act
Rules and Regulations and the Code; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets and to
maintain compliance with the books and records requirements under the 1940 Act
and the 1940 Act Rules and Regulations; (iii) access to assets is permitted only
in accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(l) The Trust shall have furnished, in form satisfactory to the
Underwriter, certification that, as of the Closing Date, the Trust is in
compliance with the requirements to qualify as a regulated investment company
under Subchapter M of the Code.
(m) The Trust and the Adviser shall have furnished or caused to
be furnished to the Underwriter such further certificates and documents as the
Underwriter shall have reasonably requested.
All such opinions, certificates, letters and other documents
will be in compliance with the provisions hereof only if they are satisfactory
in form and substance to the Underwriter and the Underwriter's counsel.
Any certificate or document signed by any officer of the Trust
or the Adviser and delivered to the Underwriter, or to counsel for the
Underwriter, shall be deemed a representation and warranty by the Trust or the
Adviser to the Underwriter as to the statements made therein.
10 Expenses. The Trust agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance by it of
its obligations hereunder: (i) the preparation, printing or reproduction, and
filing with the Commission of the registration statement (including financial
statements and exhibits thereto), each Prepricing Prospectus, the 1940 Act
Notification, the Prospectus and each amendment or supplement to any of them
(including,
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without limitation, the filing fees prescribed by the 1933 Act, the 1940 Act and
the Rules and Regulations); (ii) the printing (or reproduction) and delivery
(including postage, air freight charges and charges for counting and packaging)
of such copies of the Registration Statement, each Prepricing Prospectus, the
Prospectus, any sales material and all amendments or supplements to any of them
as may be reasonably requested for use in connection with the offering and sale
of the Shares; (iii) the preparation, printing, authentication, issuance and
delivery of certificates for the Shares, including any stamp taxes in connection
with the original issuance and sale of the Shares; (iv) the reproduction and
delivery of this Agreement, any dealer agreements, the preliminary blue sky
memorandum and all other agreements or documents reproduced and delivered in
connection with the offering of the Shares; (v) the reasonable fees, expenses
and disbursements of counsel for the Underwriter relating to the preparation,
reproduction, and delivery of the preliminary blue sky memorandum; (vi) fees
paid to the Rating Agencies; (vii) the transportation and other expenses
incurred by or on behalf of Trust representatives in connection with
presentations to prospective purchasers of the Shares; and (viii) the fees and
expenses of the Trust's accountants and the fees and expenses of counsel
(including local and special counsel) for the Trust and of the transfer agent.
11. Effective Date of Agreement. This Agreement shall become
effective: (i) upon the execution and delivery hereof by the parties hereto; or
(ii) if, at the time this Agreement is executed and delivered, it is necessary
for the registration statement or a post-effective amendment thereto to be
declared effective before the offering of the Shares may commence, when
notification of the effectiveness of the registration statement or such
post-effective amendment has been released by the Commission. Until such time as
this Agreement shall have become effective, it may be terminated by the Trust,
by notifying the Underwriter, or by the Underwriter, by notifying the Trust. Any
notice under this Section 11 may be given by telegram, telecopy or telephone but
shall be subsequently confirmed by letter.
12. Termination of Agreement. This Agreement shall be subject to
termination in the Underwriter's absolute discretion, without liability on the
part of the Underwriter to the Trust or the Adviser, by notice to the Trust or
the Adviser, if prior to the Closing Date (i) trading in securities generally on
the New York Stock Exchange, the American Stock Exchange or the Nasdaq National
Market shall have been suspended or materially limited, (ii) a general
moratorium on commercial banking activities in New York shall have been declared
by either federal or state authorities, or (iii) there shall have occurred any
outbreak or escalation of hostilities or other international or domestic
calamity, crisis or change in political, financial or economic conditions, the
effect of which on the financial markets of the United States is to make it, in
the Underwriter's judgment, impracticable or inadvisable to commence or continue
the offering of the Shares at the offering price to the public set forth on the
cover page of the Prospectus or to enforce contracts for the resale of the
Shares by the Underwriter. Notice of such termination may be given to the Trust
by telegram, telecopy or telephone and shall be subsequently confirmed by
letter.
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13. Information Furnished by the Underwriter. The statements set
forth in the last paragraph on the cover page, and the statements in the first
and third sentences of the third paragraph and the fifth paragraph under the
caption "Underwriting" in any Prepricing Prospectus and in the Prospectus,
constitute the only information furnished by or on behalf of the Underwriter as
such information is referred to in Sections 6(b) and 8 hereof.
14. Miscellaneous. Except as otherwise provided in Sections 5,
11 and 12 hereof, notice given pursuant to any provision of this Agreement shall
be in writing and shall be delivered (i) if to the Trust or the Adviser, at the
office of the Adviser at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇; or (ii) if to the Underwriter, to ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ Inc., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Manager,
Investment Banking Division.
This Agreement has been and is made solely for the benefit of
the Underwriter, the Trust, the Adviser, their directors and officers, and the
other controlling persons referred to in Section 8 hereof and their respective
successors and assigns, to the extent provided herein, and no other person shall
acquire or have any right under or by virtue of this Agreement. Neither the term
"successor" nor the term "successors and assigns" as used in this Agreement
shall include a purchaser from the Underwriter of any of the Shares in his
status as such purchaser.
Consistent with the Trust's Declaration, notice is hereby given
and the parties hereto acknowledge and agree that this Agreement is executed on
behalf of the Trustees of the Trust as Trustees and not individually and that
obligations of this Agreement are not binding upon any of the Trustees or
shareholders of the Trust individually but are binding only against the assets
and property of the Trust.
15. Applicable Law; Counterparts. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York.
This Agreement may be signed in various counterparts which
together constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
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Please confirm that the foregoing correctly sets forth the
agreement among the Trust, the Adviser and the Underwriter.
Very truly yours,
▇▇▇▇▇▇ STRATEGIC MUNICIPAL
INCOME TRUST
By:_____________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ INVESTMENTS,
INC.
By:_____________________________
Confirmed as of the date first
above mentioned.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
By:_______________________________
Managing Director
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SCHEDULE I
▇▇▇▇▇▇ STRATEGIC MUNICIPAL INCOME TRUST
Underwriter Number of Shares
----------- ----------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. ...................................... --
--
--
Total...........................................................
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