EXHIBIT (h)(ii)
▇▇▇▇▇▇▇ RREEF Real Estate Fund II, Inc.
Auction Preferred Stock
Par Value $0.01 per Share
UNDERWRITING AGREEMENT
[ ], 2003
UNDERWRITING AGREEMENT
[ ], 2003
UBS Securities LLC
[ ]
c/o UBS Securities LLC
as Managing Underwriter
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
▇▇▇▇▇▇▇ RREEF Real Estate Fund II, Inc., a Maryland corporation (the
"Fund"), proposes to issue and sell to the underwriters named in Schedule A
annexed hereto (the "Underwriters") an aggregate of [ ] preferred shares of the
Fund, par value $0.01 per share, designated Series A Auction Preferred Shares of
the Fund, and [ ] preferred shares of the Fund, par value $0.01 per share,
designated Series B Auction Preferred Shares of the Fund, each with a
liquidation preference of $25,000 per share (the "Shares") The Shares are
described in the Prospectus which is referred to below.
The Fund has filed, in accordance with the provisions of the Securities
Act of 1933, as amended, and the rules and regulations thereunder (collectively
called the "Act"), and with the provisions of the Investment Company Act of
1940, as amended, and the rules and regulations thereunder (collectively called
the "Investment Company Act"), with the Securities and Exchange Commission (the
"Commission") a registration statement on Form N-2 (File Nos. 333-[ ] and 811-
[]), including a prospectus and a statement of additional information, relating
to the Shares. The Fund has furnished to you, for use by the Underwriters and by
dealers, copies of one or more preliminary prospectuses (including a preliminary
statement of additional information) (each thereof, including such preliminary
statement of additional information, being herein called a "Preliminary
Prospectus") relating to the Shares. Except where the context otherwise
requires, the registration statement, as amended when it becomes effective (the
"Effective Date"), including all documents filed as a part thereof or
incorporated by reference therein, and including any information contained in a
prospectus subsequently filed with the Commission pursuant to Rule 497 under the
Act and deemed to be part of the registration statement at the time of
effectiveness pursuant to Rule 430A under the Act is herein called the
Registration Statement, and the prospectus (including the statement of
additional information), in the form filed by the Fund with the Commission
pursuant to Rule 497 under the Act or, if no such filing is required, the form
of final prospectus (including the form of final statement of additional
information) included in the Registration Statement at the time it became
effective, is herein called the Prospectus. In
addition, the Fund has filed a Notification of Registration on Form N-8A (the
"Notification") pursuant to Section 8 of the Investment Company Act.
Deutsche Asset Management, Inc. (the "Investment Manager") will act as
the Fund's investment manager pursuant to an Investment Management Agreement by
and between the Fund and the Investment Manager, dated as of August 26, 2003
(the "Investment Management Agreement"). RREEF America L.L.C. will act as the
Fund's investment advisor (the "Investment Adviser") pursuant to an Investment
Advisory Agreement by and between the Investment Manager and the Investment
Adviser (the "Investment Adviser"), dated as of August 26, 2003 (the "Investment
Advisory Agreement"). ▇▇▇▇▇▇▇ Fund Accounting Services Corporation, an affiliate
of the Investment Manager (the "Accounting Agent"), will act as the Fund's
accounting agent pursuant to a Fund Accounting Services Agreement by and between
the Fund and the Accounting Agent dated as of August 26, 2003 (the "Accounting
Services Agreement"). State Street Bank and Trust Company will act as the
custodian (the "Custodian") of the Fund's cash and portfolio assets pursuant to
a Custody Agreement, dated as of August 26, 2003 (the "Custody Agreement").
▇▇▇▇▇▇▇ Investment Service Company, an affiliate of the Investment Manager, will
act as the Fund's transfer agent and dividend disbursing agent with respect to
the common shares of the Fund (the "Transfer Agent") pursuant to a transfer
agency agreement, dated as of August 26, 2003 (the "Transfer Agency Agreement").
Deutsche Bank Trust Company Americas will act as the Fund's auction agent (the
"Auction Agent") for the Shares pursuant to an Auction Agency Agreement by and
between the Fund and the Auction Agent, dated as of [ ], 2003 (the "Auction
Agency Agreement"). The Fund has entered into a Letter Agreement, dated as of
[ ], 2003, with the Depository Trust Company (the "DTC Agreement"). The
Investment Manager and UBS Securities LLC (the "Managing Representative") have
entered into a Shareholder Servicing Agreement dated August 26, 2003 (the
"Shareholder Servicing Agreement").
The Fund, the Investment Manager, the Investment Adviser and the
Underwriters agree as follows:
1. SALE AND PURCHASE. Upon the basis of the warranties and representations
and subject to the terms and conditions herein set forth, the Fund
agrees to sell to the respective Underwriters and each of the
Underwriters, severally and not jointly, agrees to purchase from the
Fund the aggregate number of Shares set forth opposite the name of such
Underwriter in Schedule A attached hereto in each case at a purchase
price of $24,750 per Share. The Fund is advised that the Underwriters
intend (i) to make a public offering of their respective portions of
the Shares as soon after the effective date of the Registration
Statement as is advisable and (ii) initially to offer the Shares upon
the terms set forth in the Prospectus. The Underwriters may from time
to time increase or decrease the public offering price after the
initial public offering to such extent as they may determine.
2. PAYMENT AND DELIVERY. Payment of the purchase price for the Shares
shall be made by the Underwriters to the Fund by Federal Funds wire
transfer, against
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delivery of the certificates for the Shares to you through the
facilities of the Depository Trust Company ("DTC") for the respective
accounts of the Underwriters. Such payment and delivery shall be made
at 10:00 A.M., New York City time on the third business day following
the date of this Underwriting Agreement (unless another date or time
shall be agreed to by you and the Fund). The time at which such payment
and delivery are actually made is hereinafter sometimes called the
"Time of Purchase" or the "Closing Date."
A certificate in definitive form representing the Shares
registered in the name of Cede & Co., as nominee for DTC, shall be
delivered by or on behalf of the Fund to DTC for the account of the
Underwriters. For the purpose of expediting the checking of the
certificates for the Shares by you, the Fund agrees to make such
certificates available to you for such purpose at least one full
business day preceding the Time of Purchase.
3. REPRESENTATIONS AND WARRANTIES OF THE FUND AND THE INVESTMENT MANAGER.
Each of the Fund and the Investment Manager jointly and severally
represents and warrants to each Underwriter as follows:
(a) On (A) the Effective Date and the date on which the Prospectus
is first filed with the Commission pursuant to Rule 497(b),
(h) or (j) under the Act, as the case may be, (B) the date on
which any post-effective amendment to the Registration
Statement (except any post-effective amendment which is filed
with the Commission after the later of (x) one year from the
date of this Underwriting Agreement or (y) the date on which
the distribution of the Shares is completed) became or becomes
effective or any amendment or supplement to the Prospectus was
or is filed with the Commission and (C) the Closing Dates, the
Registration Statement, the Prospectus and any such amendment
or supplement thereto and the Notification complied or will
comply in all material respects with the requirements of the
Act and the Investment Company Act, as the case may be. On the
Effective Date and on the date that any post-effective
amendment to the Registration Statement (except any
post-effective amendment which is filed with the Commission
after the later of (x) one year from the date of this
Underwriting Agreement or (y) the date on which the
distribution of the Shares is completed) became or becomes
effective, neither the Registration Statement nor any such
amendment did or will contain any untrue statement of a
material fact or omit to state a material fact required to be
stated in it or necessary to make the statements in it not
misleading. At the Effective Date and, if applicable, the date
the Prospectus or any amendment or supplement to the
Prospectus was or is filed with the Commission and at the
Closing Dates, the Prospectus did not or will not, as the case
may be, contain any untrue statement of a material fact or
omit to state a material fact required to be stated in it or
necessary to make the statements in it, in light of the
circumstances under which they were made, not misleading. The
foregoing representations in this Section 3(a) do not apply to
statements or omissions relating to the
3
Underwriters made in reliance on and in conformity with
information furnished in writing to the Fund by you expressly
for use in the Registration Statement, the Prospectus, or any
amendments or supplements thereto, as described in Section
9(f) hereof.
(b) The Fund has been duly organized, is validly existing as a
corporation in good standing under the laws of the State of
Maryland, with full power and authority to conduct all the
activities conducted by it, to own or lease all assets owned
or leased by it and to conduct its business as described in
the Registration Statement and Prospectus, and the Fund is
duly licensed and qualified to do business and in good
standing in each jurisdiction in which its ownership or
leasing of property or its conducting of business requires
such qualification, except where the failure to be so
qualified or be in good standing would not have a material
adverse effect on the Fund, and the Fund owns, possesses or
has obtained and currently maintains all governmental
licenses, permits, consents, orders, approvals and other
authorizations, whether foreign or domestic, necessary to
carry on its business as contemplated in the Prospectus,
except where the failure to obtain such licenses, grants,
consents, orders, approvals and other authorizations, either
alone or in the aggregate, would not have a material adverse
effect on the Fund. The Fund has no subsidiaries.
(c) The capitalization of the Fund is as set forth in the
Registration Statement and the Prospectus. The common shares
of the Fund, par value $0.01 per share (the "Common Shares")
and the Shares, conform in all material respects to the
description of them in the Prospectus. All the outstanding
Common Shares have been duly authorized and are validly
issued, fully paid and nonassessable (except as described in
the Registration Statement). The Shares to be issued and
delivered to and paid for by the Underwriters in accordance
with this Underwriting Agreement against payment therefor as
provided by this Underwriting Agreement have been duly
authorized and when issued and delivered to the Underwriters
will have been validly issued and will be fully paid and
nonassessable (except as described in the Registration
Statement). No person is entitled to any preemptive or other
similar rights with respect to the Shares.
(d) The Fund is duly registered with the Commission under the
Investment Company Act as a non-diversified, closed-end
management investment company, and, subject to the filing of a
final amendment to the Registration Statement (the "Final
Amendment"), if not already filed, all action under the Act
and the Investment Company Act, as the case may be, necessary
to make the public offering and consummate the sale of the
Shares as provided in this Underwriting Agreement has or will
have been taken by the Fund.
(e) The Fund has, or at the relevant time had, full power and
authority to enter into each of this Underwriting Agreement,
the Investment Management
4
Agreement, the Fund Accounting Services Agreement, the Custody
Agreement, the Transfer Agency Agreement, the Auction Agency
Agreement and the DTC Agreement (collectively, the "Fund
Agreements") and to perform all of the terms and provisions
hereof and thereof to be carried out by it and (i) each Fund
Agreement has been duly and validly authorized, executed and
delivered by or on behalf of the Fund, (ii) each Fund
Agreement does not violate in any material respect any of the
applicable provisions of the Investment Company Act or the
Investment Advisers Act of 1940, as amended, and the rules and
regulations thereunder (collectively called the "Advisers
Act"), as the case may be, and (iii) assuming due
authorization, execution and delivery by the other parties
thereto, each Fund Agreement constitutes the legal, valid and
binding obligation of the Fund enforceable in accordance with
its terms, (A) subject, as to enforcement, to applicable
bankruptcy, insolvency and similar laws affecting creditors'
rights generally and to general equitable principles
(regardless of whether enforcement is sought in a proceeding
in equity or at law) and (B) except as rights to indemnity
thereunder may be limited by federal or state securities laws.
(f) None of (i) the execution and delivery by the Fund of the Fund
Agreements, (ii) the issue and sale by the Fund of the Shares
as contemplated by this Underwriting Agreement and (iii) the
performance by the Fund of its obligations under any of the
Fund Agreements or consummation by the Fund of the other
transactions contemplated by the Fund Agreements conflicts
with or will conflict with, or results or will result in a
breach of, the Articles of Incorporation or the By-laws of the
Fund, the Articles Supplementary of the Fund adopted in
connection with the issuance of the Shares (the "Articles
Supplementary") or any agreement or instrument to which the
Fund is a party or by which the Fund is bound, or any law,
rule or regulation, or order of any court, governmental
instrumentality, securities exchange or association or
arbitrator, whether foreign or domestic, applicable to the
Fund, other than state securities or "blue sky" laws
applicable in connection with the purchase and distribution of
the Shares by the Underwriters pursuant to this Underwriting
Agreement.
(g) The Fund is not currently in breach of, or in default under,
any written agreement or instrument to which it is a party or
by which it or its property is bound or affected, except for
such breaches or defaults that do not, either alone or in the
aggregate, have a material adverse effect on the Fund.
(h) No person has any right to the registration of any securities
of the Fund because of the filing of the registration
statement.
(i) No consent, approval, authorization or order of any court or
governmental agency or body or securities exchange or
association, whether foreign or
5
domestic, is required by the Fund for the consummation by the
Fund of the transactions to be performed by the Fund or the
performance by the Fund of all the terms and provisions to be
performed by or on behalf of it in each case as contemplated
in the Fund Agreements, except such as (i) have been obtained
under the federal securities laws, and (ii) may be required by
the American Stock Exchange or under state securities or "blue
sky" laws, in connection with the purchase and distribution of
the Shares by the Underwriters pursuant to this Underwriting
Agreement.
(j) PricewaterhouseCoopers LLP, whose report appears in the
Prospectus, are independent public accountants with respect to
the Fund as required by the Act and the Investment Company
Act.
(k) The statement of assets and liabilities included in the
Registration Statement and the Prospectus presents fairly in
all material respects, in accordance with generally accepted
accounting principles in the United States applied on a
consistent basis, the financial position of the Fund as of the
date indicated.
(l) The Fund will maintain a system of internal accounting
controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's
general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing
assets through an asset reconciliation procedure or otherwise
at reasonable intervals and appropriate action is taken with
respect to any differences.
(m) Since the date as of which information is given in the
Registration Statement and the Prospectus, except as otherwise
stated therein, (i) there has been no material adverse change
in the condition, financial or otherwise, business affairs or
business of the Fund, whether or not arising in the ordinary
course of business, (ii) there have been no transactions
entered into by the Fund other than those in the ordinary
course of its business and (iii) there has been no dividend or
distribution of any kind declared, paid or made on any class
of its capital shares [, except for a dividend declared on the
Fund's Common Shares in [insert month], 2003].
(n) There is no action, suit or proceeding before or by any court,
commission, regulatory body, administrative agency or other
governmental agency or body, foreign or domestic, now pending,
or, to the knowledge of the Fund, threatened against or
affecting the Fund, which (i) might result in any material
adverse change in the condition, financial or otherwise,
business affairs or business prospects of the Fund or might
materially adversely affect the properties or assets of the
Fund or (ii) is of a character required
6
to be described in the Registration Statement or the
Prospectus; and there are no contracts, franchises or other
documents that are of a character required to be described in,
or that are required to be filed as exhibits to, the
Registration Statement that have not been described or filed
as required.
(o) The Fund intends to direct the investment of the proceeds of
the offering of the Shares in such a manner as to comply with
the requirements of Subchapter M of the Internal Revenue Code
of 1986, as amended (the "Code").
(p) The Common Shares are listed on the American Stock Exchange.
(q) The Shares have been, or prior to the Closing Date will be,
assigned a rating of "Aaa" by ▇▇▇▇▇'▇ Investors Service, Inc.
(r) No advertising, sales literature or other promotional
materials (excluding road show slides or road show tapes) were
authorized or prepared by or on behalf of the Fund or the
Investment Manager or any representative thereof for use in
connection with the public offering or sale of the Shares
(collectively referred to as the "sales materials").
4. REPRESENTATIONS AND WARRANTIES OF THE INVESTMENT MANAGER. The
Investment Manager represents to each Underwriter as follows:
(a) The Investment Manager has been duly formed, is validly
existing as a corporation under the laws of Delaware with full
power and authority to perform its obligations under the
Investment Manager Agreements (as defined below), and the
Investment Manager is duly licensed and qualified to do
business and in good standing in each jurisdiction in which it
is required to be so qualified in order to perform its
obligations under the Investment Manager Agreements, except to
the extent that failure to be so qualified or be in good
standing would not have a material adverse effect on the
Investment Manager's ability to perform its obligations under
the Investment Manager Agreements; and the Investment Manager
owns, possesses or has obtained and currently maintains all
governmental licenses, permits, consents, orders, approvals
and other authorizations, whether foreign or domestic,
necessary in order to perform its obligations under the
Investment Manager Agreements.
(b) The Investment Manager is (i) duly registered as an investment
adviser under the Advisers Act and (ii) not prohibited by the
Advisers Act or the Investment Company Act from acting as the
investment manager for the Fund as contemplated by the
Investment Management Agreement, the Registration Statement
and the Prospectus.
(c) The Investment Manager has, or at the relevant time had, full
power and authority to enter into each of this Underwriting
Agreement, the
7
Shareholder Servicing Agreement, the Investment Management
Agreement and the Investment Advisory Agreement (collectively,
this Underwriting Agreement, the Shareholder Servicing
Agreement, the Investment Management Agreement and the
Investment Advisory Agreement being referred to as the
"Investment Manager Agreements") and to carry out all the
terms and provisions hereof and thereof to be carried out by
it; and each Investment Manager Agreement has been duly and
validly authorized, executed and delivered by the Investment
Manager; none of the Investment Manager Agreements violate in
any material respect any of the applicable provisions of the
Investment Company Act or the Advisers Act; and assuming due
authorization, execution and delivery by the other parties
thereto, each Investment Manager Agreement constitutes a
legal, valid and binding obligation of the Investment Manager,
enforceable in accordance with its terms, (i) subject, as to
enforcement, to applicable bankruptcy, insolvency and similar
laws affecting creditors' rights generally and to general
equitable principles (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (ii) except as
rights to indemnity thereunder may be limited by federal or
state securities laws.
(d) Neither (i) the execution and delivery by the Investment
Manager of any Investment Manager Agreement nor (ii) the
consummation by the Investment Manager of the transactions
contemplated by, or the performance of its obligations under
any Investment Manager Agreement conflicts or will conflict
with, or results or will result in a breach of, the charter or
by-laws of the Investment Manager or any agreement or
instrument to which the Investment Manager is a party or by
which the Investment Manager is bound, or any law, rule or
regulation, or order of any court, governmental
instrumentality, securities exchange or association or
arbitrator, whether foreign or domestic, applicable to the
Investment Manager except in each case for such conflicts or
breaches which do not, either alone or in the aggregate, have
a material adverse effect on the Investment Manager's ability
to perform its obligations under the Investment Manager
Agreements.
(e) No consent, approval, authorization or order of any court,
governmental agency or body or securities exchange or
association, whether foreign or domestic, is required to be
obtained by the Investment Manager on or prior to the Closing
Date for the consummation of the transactions contemplated in,
or the performance by the Investment Manager of its
obligations under, any Investment Manager Agreement, as the
case may be, except such as (i) have been obtained under the
federal securities laws, and (ii) may be required by the
American Stock Exchange or under state securities or "blue
sky" laws, in connection with the purchase and distribution of
the Shares by the Underwriters pursuant to this Underwriting
Agreement.
8
(f) The description of the Investment Manager and its business,
and the statements attributed to the Investment Manager, in
the Registration Statement and the Prospectus comply with the
requirements of the Act and the Investment Company Act and do
not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary in order to make the statements therein not
misleading (and, solely with respect to the Prospectus, in the
light of the circumstances under which they were made).
(g) There is no action, suit or proceeding before or by any court,
commission, regulatory body, administrative agency or other
governmental agency or body, foreign or domestic, now pending
or, to the knowledge of the Investment Manager, threatened
against or affecting the Investment Manager of a nature
required to be disclosed in the Registration Statement or
Prospectus.
(h) The Fund and the Investment Manager will not make any
promotional materials intended for use only by qualified
broker-dealers and registered representatives thereof
available by means of an Internet web site or similar
electronic means.
(i) The Investment Adviser has been duly formed, is validly
existing as a limited liability company under the laws of
Delaware with full power and authority to perform its
obligations under the Investment Advisory Agreement, and the
Investment Adviser is duly licensed and qualified to do
business and in good standing in each jurisdiction in which it
is required to be so qualified in order to perform its
obligations under the Investment Advisory Agreement, except to
the extent that failure to be so qualified or be in good
standing would not have a material adverse effect on the
Investment Adviser's ability to perform its obligations under
the Investment Advisory Agreement; and the Investment Adviser
owns, possesses or has obtained and currently maintains all
governmental licenses, permits, consents, orders, approvals
and other authorizations, whether foreign or domestic,
necessary in order to perform its obligations under the
Investment Advisory Agreement.
(j) The Investment Adviser is (i) duly registered as an investment
adviser under the Advisers Act and (ii) not prohibited by the
Advisers Act or the Investment Company Act from acting as the
investment adviser for the Fund as contemplated by the
Investment Advisory Agreement, the Registration Statement and
the Prospectus.
(k) The Investment Adviser has, or at the relevant time had, full
power and authority to enter into the Investment Advisory
Agreement and to carry out all the terms and provisions
thereof to be carried out by it; and the Investment Advisory
Agreement has been duly and validly authorized, executed and
delivered by the Investment Adviser; the Investment
9
Advisory Agreement does not violate in any material respect
any of the applicable provisions of the Investment Company Act
or the Advisers Act; and assuming due authorization, execution
and delivery by the other parties thereto, the Investment
Advisory Agreement constitutes a legal, valid and binding
obligation of the Investment Adviser, enforceable in
accordance with its terms, (i) subject, as to enforcement, to
applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and to general equitable
principles (regardless of whether enforcement is sought in a
proceeding in equity or at law) and (ii) except as rights to
indemnity thereunder may be limited by federal or state
securities laws.
(l) Neither (i) the execution and delivery by the Investment
Adviser of the Investment Advisory Agreement nor (ii) the
consummation by the Investment Adviser of the transactions
contemplated by, or the performance of its obligations under
the Investment Advisory Agreement conflicts or will conflict
with, or results or will result in a breach of, the
organizational or operational documents of the Investment
Adviser or any agreement or instrument to which the Investment
Adviser is a party or by which the Investment Adviser is
bound, or any law, rule or regulation, or order of any court,
governmental instrumentality, securities exchange or
association or arbitrator, whether foreign or domestic,
applicable to the Investment Adviser except in each case for
such conflicts or breaches which do not, either alone or in
the aggregate, have a material adverse effect on the
Investment Adviser's ability to perform its obligations under
the Investment Advisory Agreement.
(m) No consent, approval, authorization or order of any court,
governmental agency or body or securities exchange or
association, whether foreign or domestic, is required to be
obtained by the Investment Adviser on or prior to the Closing
Date for the consummation of the transactions contemplated in,
or the performance by the Investment Adviser of its
obligations under, the Investment Advisory Agreement except
such as (i) have been obtained under the federal securities
laws, and (ii) may be required by the American Stock Exchange
or under state securities or "blue sky" laws, in connection
with the purchase and distribution of the Shares by the
Underwriters pursuant to this Underwriting Agreement.
(n) The description of the Investment Adviser and its business,
and the statements attributed to the Investment Adviser, in
the Registration Statement and the Prospectus comply with the
requirements of the Act and the Investment Company Act and do
not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary in order to make the statements therein not
misleading (and, solely with respect to the Prospectus, in the
light of the circumstances under which they were made).
10
(o) There is no action, suit or proceeding before or by any court,
commission, regulatory body, administrative agency or other
governmental agency or body, foreign or domestic, now pending
or, to the knowledge of the Investment Manager after due and
appropriate inquiry, threatened against or affecting the
Investment Adviser of a nature required to be disclosed in the
Registration Statement or Prospectus.
(p) The Investment Adviser will not make any promotional materials
intended for use only by qualified broker-dealers and
registered representatives thereof available by means of an
Internet web site or similar electronic means.
5. AGREEMENTS OF THE PARTIES.
(a) If the registration statement relating to the Shares has not
yet become effective, the Fund will promptly file the Final
Amendment, if not previously filed, with the Commission, and
will use its best efforts to cause such registration statement
to become effective and, as soon as the Fund is advised, will
advise the Managing Representative when the Registration
Statement or any amendment thereto has become effective. If
the Registration Statement has become effective and the
Prospectus contained therein omits certain information at the
time of effectiveness pursuant to Rule 430A under the Act, the
Fund will file a 430A Prospectus pursuant to Rule 497(h) under
the Act as promptly as practicable, but no later than the
second business day following the earlier of the date of the
determination of the offering price of the Shares or the date
the Prospectus is first used after the Effective Date. If the
Registration Statement has become effective and the Prospectus
contained therein does not so omit such information, the Fund
will file a Prospectus pursuant to Rule 497(b) or (j) under
the Act as promptly as practicable, but no later than the
fifth business day following the date of the later of the
Effective Date or the commencement of the public offering of
the Shares after the Effective Date. In either case, the Fund
will provide you satisfactory evidence of the filing. The Fund
will not file with the Commission any Prospectus or any other
amendment (except any post-effective amendment which is filed
with the Commission after the later of (x) one year from the
date of this Underwriting Agreement or (y) the date on which
distribution of the Shares is completed) or supplement to the
Registration Statement or the Prospectus unless a copy has
first been submitted to the Managing Representative a
reasonable time before its filing and the Managing
Representative has not objected to it in writing within a
reasonable time after receiving the copy.
(b) For the period of three years from the date hereof, the Fund
will advise the Managing Representative promptly (1) of the
issuance by the Commission of any order in respect of the Fund
or the Investment Manager or which relates to the offering of
the Shares, (2) of the initiation or threatening of
11
any proceedings for, or receipt by the Fund of any notice with
respect to, the suspension of the qualification of the Shares
for sale in any jurisdiction or the issuance of any order by
the Commission suspending the effectiveness of the
Registration Statement, (3) of receipt by the Fund, or any
representative or attorney of the Fund, of any other
communication from the Commission relating in any material way
to the Fund, the Registration Statement, the Notification, any
Preliminary Prospectus, the Prospectus or to the transactions
contemplated by this Underwriting Agreement and (4) the
issuance by any court, regulatory body, administrative agency
or other governmental agency or body, whether foreign or
domestic, of any order, ruling or decree, or the threat to
initiate any proceedings with respect thereto, regarding the
offering of the shares by the Fund. The Fund will make every
reasonable effort to prevent the issuance of any order
suspending the effectiveness of the Registration Statement
and, if any such order is issued, to obtain its lifting as
soon as possible.
(c) If not delivered prior to the date of this Underwriting
Agreement, the Fund will deliver to the Managing
Representative, without charge, a signed copy of the
registration statement and the Notification and of any
amendments (except any post-effective amendment which is filed
with the Commission after the later of (x) one year from the
date of this Underwriting Agreement or (y) the date on which
the distribution of the Shares is completed) to either the
Registration Statement or the Notification (including all
exhibits filed with any such document) and as many conformed
copies of the registration statement and any amendments
thereto (except any post-effective amendment which is filed
with the Commission after the later of (x) one year from the
date of this Underwriting Agreement or (y) the date on which
the distribution of the Shares is completed) (excluding
exhibits) as the Managing Representative may reasonably
request.
(d) During such period as a prospectus is required by law to be
delivered by an underwriter or a dealer, the Fund will
deliver, without charge, to you, the Underwriters and any
dealers, at such office or offices as you may designate, as
many copies of the Prospectus as you may reasonably request,
and, if any event occurs during such period as a result of
which it is necessary to amend or supplement the Prospectus,
in order to make the statements therein, in light of the
circumstances existing when such Prospectus is delivered to a
purchaser of Shares, not misleading in any material respect,
or if during such period it is necessary to amend or
supplement the Prospectus to comply with the Act or the
Investment Company Act, the Fund promptly will prepare, submit
to the Managing Representative, file with the Commission and
deliver, without charge, to the Underwriters and to dealers
(whose names and addresses the Managing Representative will
furnish to the Fund) to whom Shares may have been sold by the
Underwriters, and to other dealers on request,
12
amendments or supplements to the Prospectus so that the
statements in such Prospectus, as so amended or supplemented,
will not, in light of the circumstances existing when such
Prospectus is delivered to a purchaser, be misleading in any
material respect and will comply with the Act and the
Investment Company Act. Delivery by the Underwriters of any
such amendments or supplements to the Prospectus will not
constitute a waiver of any of the conditions in Section 6
hereof.
(e) The Fund will make generally available to holders of the
Fund's securities, as soon as practicable but in no event
later than the last day of the 18th full calendar month
following the calendar quarter in which the Effective Date
falls, an earnings statement, if applicable, satisfying the
provisions of Section 11(a) of the Act and, at the option of
the Fund, Rule 158 under the Act.
(f) The Fund will take such actions as the Managing Representative
reasonably requests in order to qualify the Shares for offer
and sale under the securities or "blue sky" laws of such
jurisdictions as the Managing Representative reasonably
designates; provided that the Fund shall not be required in
connection therewith or as a condition thereof to qualify as a
foreign corporation or to execute a general consent to service
of process in any jurisdiction.
(g) The Fund will pay or cause to be paid the following: (i) the
fees, disbursements and expenses of the Fund's counsel and
accountants in connection with the registration of the Shares
and all other expenses in connection with the preparation,
printing and filing of the Registration Statement, any
Preliminary Prospectus and the Prospectus and amendments and
supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of
printing or reproducing this Underwriting Agreement and any
other documents in connection with the offering, purchase,
sale and delivery of the Shares (including advertising
expenses of the Underwriters, if any); (iii) the cost of
preparing share certificates; (iv) the expenses (including,
but not limited to, travel, hotels and other accommodations)
incurred by the Fund's directors, officers, employees and
other personnel in connection with meetings held with
registered brokers in connection with the offering of the
Shares, the preparing to market and the marketing of the
Shares; (v) any fees charged by securities rating services for
rating the Shares; (vi) the fees and expenses of the DTC and
its nominee, the Custodian and the Auction Agent; and (vii)
all other costs and expenses incident to the performance of
its obligations hereunder which are not otherwise specifically
provided for.
(h) If the transactions contemplated by this Underwriting
Agreement are not consummated, except as otherwise provided
herein, no party will be under any liability to any other
party, except that (i) if this Underwriting
13
Agreement is terminated by (A) the Fund or the Investment
Manager pursuant to any of the provisions hereof (otherwise
than pursuant to Section 8 hereof) or (B) by you or the
Underwriters because of any inability, failure or refusal on
the part of the Fund or the Investment Manager to comply with
any material terms of this Agreement or because any of the
conditions in Section 6 are not satisfied, the Investment
Manager or an affiliate and the Fund, jointly and severally,
will reimburse the Underwriters for all out-of-pocket expenses
(including the reasonable fees, disbursements and other
charges of their counsel) reasonably incurred by them in
connection with the proposed purchase and sale of the Shares
and (ii) no Underwriter who has failed or refused to purchase
the Shares agreed to be purchased by it under this
Underwriting Agreement, in breach of its obligations pursuant
to this Underwriting Agreement, will be relieved of liability
to the Fund and the Investment Manager and the other
Underwriters for damages occasioned by its default.
(i) Without the prior written consent of the Managing
Representative, the Fund will not offer, sell or register with
the Commission, or announce an offering of, any equity
securities of the Fund, within 180 days after the Effective
Date, except for the Shares as described in the Prospectus and
any issuances of Common Shares pursuant to the dividend
reinvestment plan established by the Fund.
(j) The Fund will direct the investment of the net proceeds of the
offering of the Shares in such a manner as to comply with the
investment objective and policies of the Fund as described in
the Prospectus.
6. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The obligations of the
Underwriters to purchase the Shares are subject to the accuracy on the
date of this Underwriting Agreement, and on each of the Closing Dates,
of the representations of the Fund and the Investment Manager in this
Underwriting Agreement, to the accuracy and completeness of all
statements made by the Fund, the Investment Manager or any of their
respective officers in any certificate delivered to the Managing
Representative or its counsel pursuant to this Underwriting Agreement,
to performance by the Fund and the Investment Manager of their
respective obligations under this Underwriting Agreement and to each of
the following additional conditions:
(a) The registration statement must have become effective by 5:30
p.m., New York City time, on the date of this Underwriting
Agreement or such later date and time as the Managing
Representative consents to in writing. The Prospectus must
have been filed in accordance with Rule 497(b), (h) or (j), as
the case may be, under the Act.
(b) No order suspending the effectiveness of the Registration
Statement may be in effect and no proceedings for such purpose
may be pending before or, to the knowledge of counsel to the
Underwriters, threatened by the
14
Commission, and any requests for additional information on the
part of the Commission (to be included in the Registration
Statement or the Prospectus or otherwise) must be complied
with or waived to the reasonable satisfaction of the Managing
Representative.
(c) Since the dates as of which information is given in the
Registration Statement and the Prospectus, (i) there must not
have been any material change in the number of outstanding
Common Shares, Shares or liabilities of the Fund except as set
forth in or contemplated by the Prospectus (provided that a
change in the Fund's net asset value, liabilities or portfolio
securities in the exercise of its normal investment operations
shall not be deemed to be a material adverse change); (ii)
there must not have been any material adverse change in the
general affairs, prospects, management, business, financial
condition or results of operations of the Fund or the
Investment Manager, whether or not arising from transactions
in the ordinary course of business as set forth in or
contemplated by the Prospectus (provided that a change in the
Fund's net asset value, liabilities or portfolio securities in
the exercise of its normal investment operations shall not be
deemed to be a material adverse change); (iii) the Fund must
not have sustained any material interference with its business
from any court or from legislative or other governmental
action, order or decree, whether foreign or domestic, or from
any other occurrence not described in the Registration
Statement and Prospectus; and (iv) there must not have
occurred any event that makes untrue or incorrect in any
material respect any statement or information contained in the
Registration Statement or Prospectus or that is not reflected
in the Registration Statement or Prospectus but should be
reflected therein in order to make the statements or
information therein (in the case of the Prospectus, in light
of the circumstances in which they were made) not misleading
in any material respect; if, in the judgment of the Managing
Representative, any such development referred to in clause
(i), (ii), (iii) or (iv) of this paragraph (c) makes it
impracticable or inadvisable to consummate the sale and
delivery of the Shares pursuant to this Underwriting Agreement
by the Underwriters, at the initial public offering price of
the Shares.
(d) The Managing Representative must have received on the Closing
Date a certificate, dated such date, of the President or a
Vice-President and the chief financial or accounting officer
of each of the Fund and the Investment Manager certifying that
(i) the signers have carefully examined the Registration
Statement, the Prospectus, and this Underwriting Agreement,
(ii) the representations of the Fund (with respect to the
certificates from such Fund officers) and the representations
of the Investment Manager (with respect to the certificates
from such officers of the Investment Manager) in this
Underwriting Agreement are accurate on and as of the date of
the certificate, (iii) there has not been any material adverse
change in the general affairs, prospects, management,
business, financial condition or results of operations of the
Fund (with respect to the
15
certificates from such Fund officers) or the Investment
Manager (with respect to the certificates from such officers
of the Investment Manager), which change would materially and
adversely affect the ability of the Fund or the Investment
Manager, as the case may be, to fulfill its obligations under
this Underwriting Agreement or the Investment Management
Agreement, whether or not arising from transactions in the
ordinary course of business, (iv) with respect to the Fund
only, to the knowledge of such officers after reasonable
investigation, no order suspending the effectiveness of the
Registration Statement or prohibiting the sale of any of the
Shares has been issued and no proceedings for any such purpose
are pending before or threatened by the Commission or any
other regulatory body, whether foreign or domestic, (v) to the
knowledge of the officers of the Investment Manager, after
reasonable investigation, no order having a material adverse
effect on the ability of the Investment Manager to fulfill its
obligations under this Underwriting Agreement or the
Investment Management Agreement, as the case may be, has been
issued and no proceedings for any such purpose are pending
before or threatened by the Commission or any other regulatory
body, whether foreign or domestic, and (vi) each of the Fund
(with respect to the certificates from such Fund officers) and
the Investment Manager (with respect to the certificates from
such officers of the Investment Manager) has performed all of
its respective agreements that this Underwriting Agreement
requires it to perform by the Closing Date (to the extent not
waived in writing by the Managing Representative).
(e) You must receive on the Closing Date the opinions dated such
Closing Date substantially in the form of Schedules B, C and D
to this Underwriting Agreement from the counsel identified in
each such Schedules.
(f) You must receive on the Closing Date from Skadden, Arps,
Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP and its affiliated entities an
opinion dated such Closing Date with respect to the Fund, the
Shares, the Registration Statement and the Prospectus, this
Underwriting Agreement and the form and sufficiency of all
proceedings taken in connection with the sale and delivery of
the Shares. Such opinion and proceedings shall fulfill the
requirements of this Section 6(f) only if such opinion and
proceedings are satisfactory in all respects to the Managing
Representative. The Fund and the Investment Manager must have
furnished to such counsel such documents as counsel may
reasonably request for the purpose of enabling them to render
such opinion.
(g) The Managing Representative must receive on the date this
Underwriting Agreement is signed and delivered by you a signed
letter, dated such date, substantially in the form of Schedule
E to this Underwriting Agreement from the firm of accountants
designated in such Schedule. The Managing Representative also
must receive on the Closing Date a signed letter from
16
such accountants, dated as of such Closing Date, confirming on
the basis of a review in accordance with the procedures set
forth in their earlier letter that nothing has come to their
attention during the period from a date not more than five
business days before the date of this Underwriting Agreement,
specified in the letter, to a date not more than five business
days before such Closing Date, that would require any change
in their letter referred to in the foregoing sentence.
(h) The Shares shall have been accorded a rating of "Aaa" by
▇▇▇▇▇'▇ Investors Service, Inc. and a letter to such effect,
dated on or before the Closing Date, shall have been delivered
to the Managing Representative.
(i) As of the Closing Date, and assuming the receipt of the net
proceeds from the sale of the Shares, the 1940 Act Preferred
Shares Asset Coverage and the Preferred Shares Basic
Maintenance Amount (each as defined in the Prospectus) each
will be met.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Underwriting Agreement will comply only if
they are in form and scope reasonably satisfactory to counsel for the
Underwriters, provided that any such documents, forms of which are
annexed hereto, shall be deemed satisfactory to such counsel if
substantially in such form.
7. TERMINATION. This Underwriting Agreement may be terminated by the
Managing Representative by notifying the Fund at any time:
(a) before the later of the effectiveness of the Registration
Statement and the time when any of the Shares are first
generally offered pursuant to this Underwriting Agreement by
the Managing Representative to dealers by letter or telegram;
(b) at or before the Closing Date if, in the sole judgment of the
Managing Representative, payment for and delivery of any
Shares is rendered impracticable or inadvisable because (i)
trading in the equity securities of the Fund is suspended by
the Commission or by the principal exchange that lists the
Common Shares, (ii) trading in securities generally on the New
York Stock Exchange, the American Stock Exchange or the Nasdaq
Stock Market shall have been suspended or limited or minimum
or maximum prices shall have been generally established on
such exchange or over-the-counter market, (iii) additional
material governmental restrictions, not in force on the date
of this Underwriting Agreement, have been imposed upon trading
in securities or trading has been suspended on any U.S.
securities exchange, (iv) a general banking moratorium has
been established by U.S. federal or New York authorities or
(v) any material adverse change in the financial or securities
markets in the United States or in political, financial or
economic conditions in the United States or any outbreak or
material escalation of hostilities or declaration by the
United
17
States of a national emergency or war or other calamity or
crisis shall have occurred the effect of any of which is such
as to make it, in the sole judgment of the Managing
Representative, impracticable or inadvisable to market the
Shares on the terms and in the manner contemplated by the
Prospectus; or
(c) at or before the Closing Date, if any of the conditions
specified in Section 6 have not been fulfilled when and as
required by this Underwriting Agreement.
8. SUBSTITUTION OF UNDERWRITERS. If one or more of the Underwriters fails
(other than for a reason sufficient to justify the termination of this
Underwriting Agreement) to purchase on the Closing Date the Shares
agreed to be purchased on the Closing Date by such Underwriter or
Underwriters, the Managing Representative may find one or more
substitute underwriters to purchase such Shares or make such other
arrangements as the Managing Representative deems advisable, or one or
more of the remaining Underwriters may agree to purchase such Shares in
such proportions as may be approved by the Managing Representative, in
each case upon the terms set forth in this Underwriting Agreement. If
no such arrangements have been made within 36 hours after the Closing
Date, and
(a) the number of Shares to be purchased by the defaulting
Underwriters on the Closing Date does not exceed 10% of the
Shares that the Underwriters are obligated to purchase on the
Closing Date, each of the nondefaulting Underwriters will be
obligated to purchase such Shares on the terms set forth in
this Underwriting Agreement in proportion to their respective
obligations under this Underwriting Agreement, or
(b) the number of Shares to be purchased by the defaulting
Underwriters on the Closing Date exceeds 10% of the Shares to
be purchased by all the Underwriters on the Closing Date, the
Fund will be entitled to an additional period of 24 hours
within which to find one or more substitute underwriters
reasonably satisfactory to the Managing Representative to
purchase such Shares on the terms set forth in this
Underwriting Agreement.
In any such case, either the Managing Representative or the
Fund will have the right to postpone the Closing Date for not more than
five business days in order that necessary changes and arrangements
(including any necessary amendments or supplements to the Registration
Statement or the Prospectus) may be effected by the Managing
Representative and the Fund. If the number of Shares to be purchased on
the Closing Date by such defaulting Underwriter or Underwriters exceeds
10% of the Shares that the Underwriters are obligated to purchase on
the Closing Date, and none of the nondefaulting Underwriters or the
Fund makes arrangements pursuant to this Section within the period
stated for the purchase of the Shares that the defaulting Underwriters
agreed to purchase, this
18
Underwriting Agreement will terminate without liability on the
part of any nondefaulting Underwriter, the Fund or the
Investment Manager, except as provided in Sections 5(h) and 9
hereof. This Section will not affect the liability of any
defaulting Underwriter to the Fund or the nondefaulting
Underwriters arising out of such default. A substitute
underwriter will become a Underwriter for all purposes of this
Underwriting Agreement.
9. INDEMNITY AND CONTRIBUTION.
(a) Each of the Fund, the Investment Manager and the Investment
Adviser, jointly and severally, agrees to indemnify, defend
and hold harmless each Underwriter, its partners, directors
and officers, and any person who controls any Underwriter
within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, and the successors and assigns of all of the
foregoing persons from and against any loss, damage, expense,
liability or claim (including the reasonable cost of
investigation) which, jointly or severally, any such
Underwriter or any such person may incur under the Act, the
Exchange Act, the Investment Company Act, the Advisers Act,
the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or in the
Registration Statement as amended by any post-effective
amendment thereof by the Fund) or in a Prospectus (the term
"Prospectus" for the purpose of this Section 9 being deemed to
include any Preliminary Prospectus, any sales materials
prepared or authorized by the Fund, the Prospectus and the
Prospectus as amended or supplemented by the Fund), or arises
out of or is based upon any omission or alleged omission to
state a material fact required to be stated in either such
Registration Statement or Prospectus or necessary to make the
statements made therein not misleading, except insofar as any
such loss, damage, expense, liability or claim arises out of
or is based upon any untrue statement or alleged untrue
statement of a material fact contained in and in conformity
with information furnished in writing by or on behalf of any
Underwriter through you to the Fund or the Investment Manager
expressly for use with reference to such Underwriter in such
Registration Statement or such Prospectus or arises out of or
is based upon any omission or alleged omission to state a
material fact in connection with such information required to
be stated in such Registration Statement or such Prospectus or
necessary to make such information not misleading, provided,
however, that the indemnity agreement contained in this
subsection (a) with respect to any Preliminary Prospectus or
amended Preliminary Prospectus shall not inure to the benefit
of any Underwriter (or to the benefit of any person
controlling such Underwriter) from whom the person asserting
any such loss, damage, expense, liability or claim purchased
the Shares which is the subject thereof if the Prospectus
corrected any such alleged untrue statement or omission and if
such Underwriter failed to send or give a copy of the
Prospectus to such person
19
at or prior to the written confirmation of the sale of such
Shares to such person, unless the failure is the result of
noncompliance by the Fund with Section 5(d) hereof.
If any action, suit or proceeding (together, a
"Proceeding") is brought against an Underwriter or any such
person in respect of which indemnity may be sought against the
Fund, the Investment Manager or the Investment Adviser
pursuant to the foregoing paragraph, such Underwriter or such
person shall promptly notify the Fund, the Investment Manager
or the Investment Adviser, as the case may be, in writing of
the institution of such Proceeding and the Fund, the
Investment Manager or the Investment Adviser shall assume the
defense of such Proceeding, including the employment of
counsel reasonably satisfactory to such indemnified party and
payment of all fees and expenses; provided, however, that the
omission to so notify the Fund, the Investment Manager or the
Investment Adviser shall not relieve the Fund, the Investment
Manager or the Investment Adviser from any liability which the
Fund, the Investment Manager or the Investment Adviser may
have to any Underwriter or any such person or otherwise and,
unless and only to the extent that, such omission results in
the forfeiture of substantive rights or defenses by the
indemnifying party. Such Underwriter or such person shall have
the right to employ its or their own counsel in any such case,
but the fees and expenses of such counsel shall be at the
expense of such Underwriter or of such person unless the
employment of such counsel shall have been authorized in
writing by the Fund, the Investment Manager or the Investment
Adviser, as the case may be, in connection with the defense of
such Proceeding or the Fund, the Investment Manager or the
Investment Adviser shall not have, within a reasonable period
of time in light of the circumstances, employed counsel to
have charge of the defense of such Proceeding or such
indemnified party or parties shall have reasonably concluded
that there may be defenses available to it or them which are
different from, additional to or in conflict with those
available to the Fund, the Investment Manager or the
Investment Adviser (in which case the Fund, the Investment
Manager or the Investment Adviser, as the case may be, shall
not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties), in any of which
events such fees and expenses shall be borne by the Fund, the
Investment Manager or the Investment Adviser, as the case may
be, and paid as incurred (it being understood, however, that
the Fund, the Investment Manager or the Investment Adviser
shall not be liable for the expenses of more than one separate
counsel (in addition to any local counsel) in any one
Proceeding or series of related Proceedings in the same
jurisdiction representing the indemnified parties who are
parties to such Proceeding). None of the Fund, the Investment
Manager or the Investment Adviser shall be liable for any
settlement of any Proceeding effected without its written
consent but if settled with the written consent of the Fund,
the Investment Manager or the Investment Adviser, as the case
may be, the Fund, the Investment
20
Manager or the Investment Adviser, as the case may be, agrees
to indemnify and hold harmless any Underwriter and any such
person from and against any loss or liability by reason of
such settlement. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees
and expenses of counsel as contemplated by the second sentence
of this paragraph, then the indemnifying party agrees that it
shall be liable for any settlement of any Proceeding effected
without its written consent if (i) such settlement is entered
into more than 60 business days after receipt by such
indemnifying party of the aforesaid request, (ii) such
indemnifying party shall not have reimbursed the indemnified
party in accordance with such request prior to the date of
such settlement and (iii) such indemnified party shall have
given the indemnifying party at least 30 days' prior notice of
its intention to settle. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any
settlement of any pending or threatened Proceeding in respect
of which any indemnified party is or could have been a party
and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all
liability on claims that are the subject matter of such
Proceeding and does not include an admission of fault,
culpability or a failure to act, by or on behalf of such
indemnified party.
(b) Each Underwriter severally agrees to indemnify, defend and
hold harmless the Fund, the Investment Manager and the
Investment Adviser, any of their partners, directors and
officers, and any person who controls the Fund, the Investment
Manager or the Investment Adviser within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, and
the successors and assigns of all of the foregoing persons
from and against any loss, damage, expense, liability or claim
(including the reasonable cost of investigation) which,
jointly or severally, the Fund, the Investment Manager or the
Investment Adviser or any such person may incur under the Act,
the Exchange Act, the Investment Company Act, the Advisers
Act, the common law or otherwise, insofar as such loss,
damage, expense, liability or claim arises out of or is based
upon any untrue statement or alleged untrue statement of a
material fact contained in and in conformity with information
furnished in writing by or on behalf of such Underwriter
through you to the Fund, the Investment Manager or the
Investment Adviser expressly for use with reference to such
Underwriter in the Registration Statement (or in the
Registration Statement as amended by any post-effective
amendment thereof by the Fund) or in a Prospectus, or arises
out of or is based upon any omission or alleged omission to
state a material fact in connection with such information
required to be stated in such Registration Statement or such
Prospectus or necessary to make such information not
misleading.
21
If any Proceeding is brought against the Fund, the
Investment Manager or the Investment Adviser, or any such
person in respect of which indemnity may be sought against any
Underwriter pursuant to the foregoing paragraph, the Fund, the
Investment Manager or the Investment Adviser or such person
shall promptly notify such Underwriter in writing of the
institution of such Proceeding and such Underwriter shall
assume the defense of such Proceeding, including the
employment of counsel reasonably satisfactory to such
indemnified party and payment of all fees and expenses;
provided, however, that the omission to so notify such
Underwriter shall not relieve such Underwriter from any
liability which such Underwriter may have to the Fund, the
Investment Manager or the Investment Adviser, or any such
person or otherwise. The Fund, the Investment Manager or the
Investment Adviser, or such person shall have the right to
employ its own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of the Fund,
the Investment Manager or the Investment Adviser, or such
person, as the case may be, unless the employment of such
counsel shall have been authorized in writing by such
Underwriter in connection with the defense of such Proceeding
or such Underwriter shall not have, within a reasonable period
of time in light of the circumstances, employed counsel to
have charge of the defense of such Proceeding or such
indemnified party or parties shall have reasonably concluded
that there may be defenses available to it or them which are
different from or additional to or in conflict with those
available to such Underwriter (in which case such Underwriter
shall not have the right to direct the defense of such
Proceeding on behalf of the indemnified party or parties, but
such Underwriter may employ counsel and participate in the
defense thereof but the fees and expenses of such counsel
shall be at the expense of such Underwriter), in any of which
events such fees and expenses shall be borne by such
Underwriter and paid as incurred (it being understood,
however, that such Underwriter shall not be liable for the
expenses of more than one separate counsel (in addition to any
local counsel) in any one Proceeding or series of related
Proceedings in the same jurisdiction representing the
indemnified parties who are parties to such Proceeding). No
Underwriter shall be liable for any settlement of any such
Proceeding effected without the written consent of such
Underwriter but if settled with the written consent of such
Underwriter, such Underwriter agrees to indemnify and hold
harmless the Fund, the Investment Manager or the Investment
Adviser and any such person from and against any loss or
liability by reason of such settlement. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall
have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as
contemplated by the second sentence of this paragraph, then
the indemnifying party agrees that it shall be liable for any
settlement of any Proceeding effected without its written
consent if (i) such settlement is entered into more than 60
business days after receipt by
22
such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall not have reimbursed the indemnified
party in accordance with such request prior to the date of
such settlement and (iii) such indemnified party shall have
given the indemnifying party at least 30 days' prior notice of
its intention to settle. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any
settlement of any pending or threatened Proceeding in respect
of which any indemnified party is or could have been a party
and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all
liability on claims that are the subject matter of such
Proceeding and does not include an admission of fault,
culpability or a failure to act, by or on behalf of such
indemnified party.
(c) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subsections (a) and
(b) of this Section 9 in respect of any losses, damages,
expenses, liabilities or claims referred to therein, then each
applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses,
damages, expenses, liabilities or claims (i) in such
proportion as is appropriate to reflect the relative benefits
received by the Fund, the Investment Manager and the
Investment Adviser on the one hand and the Underwriters on the
other hand from the offering of the Shares or (ii) if the
allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Fund, the
Investment Manager and the Investment Adviser on the one hand
and of the Underwriters on the other in connection with the
statements or omissions which resulted in such losses,
damages, expenses, liabilities or claims, as well as any other
relevant equitable considerations. The relative benefits
received by the Fund, the Investment Manager or the Investment
Adviser on the one hand and the Underwriters on the other
shall be deemed to be in the same respective proportions as
the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses)
received by the Fund and the total underwriting discounts and
commissions received by the Underwriters, bear to the
aggregate public offering price of the Shares. The relative
fault of the Fund, the Investment Manager and the Investment
Adviser on the one hand and of the Underwriters on the other
shall be determined by reference to, among other things,
whether the untrue statement or alleged untrue statement of a
material fact or omission or alleged omission relates to
information supplied by the Fund, the Investment Manager or
the Investment Adviser or by the Underwriters and the parties'
relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the
losses, damages, expenses,
23
liabilities and claims referred to in this subsection shall be
deemed to include any legal or other fees or expenses
reasonably incurred by such party in connection with
investigating, preparing to defend or defending any
Proceeding.
(d) The Fund, the Investment Manager and the Investment Adviser
and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 were
determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other
method of allocation that does not take account of the
equitable considerations referred to in subsection (c) above.
Notwithstanding the provisions of this Section 9, no
Underwriter shall be required to contribute any amount in
excess of the fees and commissions received by such
Underwriter. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters'
obligations to contribute pursuant to this Section 9 are
several in proportion to their respective underwriting
commitments and not joint.
(e) The indemnity and contribution agreements contained in this
Section 9 and the covenants, warranties and representations of
the Fund and the Investment Manager contained in this
Agreement shall remain in full force and effect regardless of
any investigation made by or on behalf of any Underwriter, its
partners, directors or officers or any person (including each
partner, officer or director of such person) who controls any
Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, or by or on behalf of the
Fund, the Investment Manager or the Investment Adviser, any of
their partners, directors or officers or any person (including
each partner, officer or director of such person) who controls
the Fund, the Investment Manager or the Investment Adviser
within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, and shall survive any termination of this
Agreement or the issuance and delivery of the Shares. The
Fund, the Investment Manager or the Investment Adviser and
each Underwriter agree promptly to notify each other of the
commencement of any Proceeding against it and, in the case of
the Fund, the Investment Manager and the Investment Adviser,
against any of the Fund's, the Investment Manager's or the
Investment Adviser's officers or directors in connection with
the issuance and sale of the Shares, or in connection with the
Registration Statement or Prospectus.
(f) The Fund, the Investment Manager and the Investment Adviser
each acknowledge that the statements with respect to (1) the
public offering of the Shares as set forth on the cover page
of and (2) the statements relating to selling concessions and
reallowances of selling concessions and with respect to
discretionary accounts under the caption "Underwriting" in the
Prospectus constitute the only information furnished in
writing to the Fund
24
by the Representatives on behalf of the Underwriters expressly
for use in such document. The Underwriters severally confirm
that these statements are correct in all material respects and
were so furnished by or on behalf of the Underwriters
severally for use in the Prospectus.
(g) Notwithstanding any other provisions in this Section 9, no
party shall be entitled to indemnification or contribution
under this Underwriting Agreement against any loss, claim,
liability, expense or damage arising by reason of such
person's willful misfeasance, bad faith, gross negligence, or
by reason of such party's reckless disregard of its
obligations and duties under this Agreement.
10. NOTICES. Except as otherwise herein provided, all statements, requests,
notices and agreements shall be in writing or by telegram and, if to
the Underwriters, shall be sufficient in all respects if delivered or
sent to UBS Securities LLC, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: Syndicate Department and, if to the Fund or the Investment
Manager, shall be sufficient in all respects if delivered or sent to
the Fund or the Investment Manager, as the case may be, at the offices
of the Fund or the Investment Manager at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention: President and if delivered or sent to the
Investment Adviser at the offices of the Investment Adviser at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: President.
11. GOVERNING LAW; CONSTRUCTION. This Agreement and any claim, counterclaim
or dispute of any kind or nature whatsoever arising out of or in any
way relating to this Agreement ("Claim"), directly or indirectly, shall
be governed by, and construed in accordance with, the laws of the State
of New York. The Section headings in this Agreement have been inserted
as a matter of convenience of reference and are not a part of this
Agreement.
12. SUBMISSION TO JURISDICTION. Except as set forth below, no Claim may be
commenced, prosecuted or continued in any court other than the courts
of the State of New York located in the City and County of New York or
in the United States District Court for the Southern District of New
York, which courts shall have jurisdiction over the adjudication of
such matters, and the Fund consents to the jurisdiction of such courts
and personal service with respect thereto. The Fund hereby consents to
personal jurisdiction, service and venue in any court in which any
Claim arising out of or in any way relating to this Agreement is
brought by any third party against UBS Securities LLC or any
indemnified party. Each of UBS Securities LLC, the Fund (on its behalf
and, to the extent permitted by applicable law, on behalf of its
stockholders and affiliates) and the Investment Manager (on its behalf
and, to the extent permitted by applicable law, on behalf of its
stockholders and affiliates) waives all right to trial by jury in any
action, proceeding or counterclaim (whether based upon contract, tort
or otherwise) in any way arising out of or relating to this Agreement.
Each of the Fund, the Investment Manager and the Investment Adviser
agrees that a final judgment in any such action, proceeding or
counterclaim brought in any such court shall be
25
conclusive and binding upon the Fund, the Investment Manager or the
Investment Adviser, as the case may be, and may be enforced in any
other courts in the jurisdiction of which the Fund, the Investment
Manager or the Investment Adviser, as the case may be, is or may be
subject, by suit upon such judgment.
13. PARTIES AT INTEREST. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriters, the Fund, the
Investment Manager and the Investment Adviser and to the extent
provided in Section 9 hereof the controlling persons, partners,
directors and officers referred to in such section, and their
respective successors, assigns, heirs, personal representatives and
executors and administrators. No other person, partnership, association
or corporation (including a purchaser, as such purchaser, from any of
the Underwriters) shall acquire or have any right under or by virtue of
this Agreement.
14. COUNTERPARTS. This Agreement may be signed by the parties in one or
more counterparts which together shall constitute one and the same
agreement among the parties.
15. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Underwriters, the Fund, the Investment Manager or the Investment
Adviser, and any successor or assign of any substantial portion of the
Fund's, the Investment Manager's, the Investment Adviser's or any of
the Underwriters' respective businesses and/or assets.
26
If the foregoing correctly sets forth the understanding among the Fund
and the Underwriters, please so indicate in the space provided below for the
purpose, whereupon this letter and your acceptance shall constitute a binding
agreement among the Fund, the Investment Manager, the Investment Adviser and the
Underwriters, severally.
Very truly yours,
▇▇▇▇▇▇▇ RREEF REAL ESTATE FUND II, INC.
-----------------------------------------
By:
Title:
DEUTSCHE ASSET MANAGEMENT, INC.
-----------------------------------------
By:
Title:
RREEF AMERICA L.L.C.
-----------------------------------------
By:
Title:
27
Accepted and agreed to as of the
date first above written, on
behalf of themselves and
the other several Underwriters
named in Schedule A
UBS SECURITIES LLC
[ ]
By: UBS SECURITIES LLC
--------------------------
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
--------------------------
By: ▇▇▇▇ ▇. Reit
Title: Executive Director
28
SCHEDULE A
Number of Shares
Name to be Purchased
---- ----------------
UBS Securities LLC
-----
Total
SCHEDULE B
FORM OF OPINION OF
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ REGARDING THE FUND
i. The Registration Statement and all post-effective amendments, if any,
are effective under the Act and no stop order with respect thereto has been
issued and no proceeding for that purpose has been instituted or, to the best of
our knowledge, is threatened by the Commission. Any filing of the Prospectus or
any supplements thereto required under Rule 497 under the Act prior to the date
hereof have been made in the manner and within the time required by such rule.
ii. The Fund has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Maryland, with full
corporate power to conduct all the activities conducted by it, to own or lease
all assets owned (or to be owned) or leased (or to be leased) by it and to
conduct its business, all as described in the Registration Statement and
Prospectus, and the Fund is duly licensed and qualified to do business and in
good standing in each jurisdiction in which its ownership or leasing of property
or its conducting of business requires such qualification, except where the
failure to be so qualified or be in good standing, either alone or in the
aggregate, would not have a material adverse effect on the Fund, and the Fund
owns, possesses or has obtained and currently maintains all governmental
licenses, permits, consents, orders, approvals and other authorizations, whether
foreign or domestic, necessary to carry on its business as contemplated in the
Prospectus, except where the failure to obtain such licenses, permits, consents,
orders, approvals and other authorizations, either alone or in the aggregate,
would not have a material adverse effect on the Fund. The Fund has no
subsidiaries.
iii. The number of authorized shares of Common Shares of the Fund is as set
forth in the Registration Statement and the Prospectus under the caption
"Description of Common Shares." The Common Shares of the Fund conform in all
material respects to the description of them in the Prospectus under the caption
"Description of Common Shares." All the outstanding Common Shares have been duly
authorized and are validly issued, fully paid and nonassessable. The number of
authorized shares of Shares of the Fund is as set forth in the Registration
Statement and the Prospectus under the caption "Description of Preferred
Shares." The Shares of the Fund conform in all material respects to the
description of them in the Prospectus under the caption "Description of
Preferred Shares." The Shares to be issued and delivered to and paid for by the
Underwriters in accordance with the Underwriting Agreement against payment
therefor as provided by the Underwriting Agreement have been duly authorized and
when issued and delivered to the Underwriters as so provided will have been
validly issued and will be fully paid and nonassessable (except as described in
the Registration Statement). No person is entitled to any preemptive or other
similar rights with respect to the Shares under the charter or by-laws of the
Fund or the Maryland General Corporation law or, to counsel's knowledge,
otherwise.
iv. The Fund is duly registered with the Commission under the Investment
Company Act as a non-diversified, closed-end management investment company and
all action under the Act and the Investment Company Act, as the case may be,
necessary to make the public offering and consummate the sale of the Shares as
provided in the Underwriting Agreement has or will have been taken by the Fund.
v. The Fund has full corporate power to enter into each of the
Underwriting Agreement, the Investment Management Agreement, the Custody
Agreement, the Fund Accounting Services Agreement, the Transfer Agency
Agreement, the Auction Agency Agreement and the DTC Agreement (collectively, the
"Fund Agreements") and to perform all of the terms and provisions thereof to be
carried out by it and (A) each Fund Agreement has been duly and validly
authorized, executed and delivered by the Fund, (B) each Fund Agreement complies
in all material respects with all applicable provisions of the Investment
Company Act and the Advisers Act, as the case may be, and (C) assuming due
authorization, execution and delivery by the other parties thereto, each Fund
Agreement constitutes the legal, valid and binding obligation of the Fund
enforceable against the Fund in accordance with its terms, (1) subject, as to
enforcement, to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and to general equitable principles (regardless of
whether enforcement is sought in a proceeding in equity or at law) and (2)
except as rights to indemnity thereunder may be limited by federal or state
securities laws.
vi. None of (A) the execution and delivery by the Fund of the Fund
Agreements, (B) the issue and sale by the Fund of the Shares as contemplated by
the Underwriting Agreement and (C) the performance by the Fund of its
obligations under the Fund Agreements or consummation by the Fund of the other
transactions contemplated by the Fund Agreements conflicts with or will conflict
with, or results or will result in a breach of, the Articles of Incorporation,
the Articles Supplementary or the By-laws of the Fund or any agreement or
instrument to which the Fund is a party or by which the Fund is bound that is
filed as an exhibit to the Registration Statement, or any law, rule or
regulation which in our experience is normally applicable to transactions of the
type contemplated by the Underwriting Agreement, or order of any court,
governmental instrumentality, securities exchange or association or arbitrator,
whether foreign or domestic, specifically naming the Fund and known to counsel,
except that we express no opinion as to the securities or "blue sky" laws
applicable in connection with the purchase and distribution of the Shares by the
Underwriters pursuant to the Underwriting Agreement.
vii. No consent, approval, authorization or order of any court (to counsel's
knowledge) or governmental agency or body or securities exchange or association,
whether foreign or domestic, is required by the Fund for the consummation by the
Fund of the transactions to be performed by the Fund or the performance by the
Fund of all the terms and provisions to be performed by or on behalf of it in
each case as contemplated in the Fund Agreements, except such as (A) have been
obtained under the federal securities laws and (B) may be required by the
American Stock Exchange or under state
B-2
securities or "blue sky" laws in connection with the purchase and distribution
of the Shares by the Underwriters pursuant to the Underwriting Agreement.
viii. We do not know of any legal or governmental proceeding pending or
threatened against the Fund.
ix. The Fund does not require any tax or other rulings to enable it to
qualify as a regulated investment company under Subchapter M of the Code.
x. The section in the Prospectus entitled "Taxation" and the section in
the Statement of Additional Information entitled "Taxation" is a fair summary
of the principal United States federal income tax rules currently in effect
applicable to the Fund and to the purchase, ownership and disposition of the
Shares.
xi. The Registration Statement (except the financial statements and
schedules including the notes and schedules thereto, and other financial or
accounting data included therein or omitted therefrom, as to which we express no
view), at the time it became effective, and the Prospectus (except as
aforesaid), as of the date thereof, complied as to form in all material respects
to the requirements of the Act and the Investment Company Act.
While we have not 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 set forth in paragraph
(x) above, in the course of our review of the contents of the Registration
Statement and the Prospectus with certain officers and employees of the Fund and
the Fund's independent accountants, no facts have come to our attention that
cause us to believe that the Registration Statement, at the time it became
effective (but after giving effect to any changes incorporated pursuant to Rule
430A under the Act), contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading (except that we express no such view
with respect to the financial statements, including notes and schedules thereto,
or any other financial or accounting data included therein), or that the
Prospectus, as of the date it was filed with the Commission pursuant to Rule 497
under the Act and as of the date hereof, contained or contains an untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (except that we express
no such view with respect to the financial statements, including notes and
schedules thereto, or any other financial or accounting data included therein).
B-3
SCHEDULE C
FORM OF OPINION OF INTERNAL COUNSEL
REGARDING DEUTSCHE ASSET MANAGEMENT, INC.
i. Deutsche Asset Management, Inc. (the "Investment Manager") has been
duly formed and is validly existing as a corporation under the laws of its
jurisdiction of incorporation with full power and authority to own or lease all
of the assets owned or leased by it and to conduct its business as described in
the Registration Statement and Prospectus and to enter into and perform its
obligations under the Underwriting Agreement, the Shareholder Servicing
Agreement, the Investment Management Agreement and the Investment Advisory
Agreement.
ii. The Investment Manager is duly registered as an investment adviser
under the Advisers Act and is not prohibited by the Advisers Act or the
Investment Company Act from acting as investment manager for the Fund as
contemplated by the Investment Advisory Agreement, the Registration Statement
and the Prospectus.
iii. The Investment Manager has, or at the relevant time had, full power and
authority to enter into each of the Underwriting Agreement, the Investment
Management Agreement, the Investment Advisory Agreement and the Shareholder
Servicing Agreement (collectively, the "Investment Manager Agreements") and to
carry out all the terms and provisions thereof to be carried out by it, and each
such agreement has been duly and validly authorized, executed and delivered by
the Investment Manager; each Investment Manager Agreement complies in all
material respects with all provisions of the Investment Company Act and the
Advisers Act; and assuming due authorization, execution and delivery by the
other parties thereto, each Investment Manager Agreement constitutes a legal,
valid and binding obligation of the Investment Manager, enforceable against the
Investment Manager in accordance with its terms, (1) subject, as to enforcement,
to applicable bankruptcy, insolvency and similar laws affecting creditors'
rights generally and to general equitable principles (regardless of whether
enforcement is sought in a proceeding in equity or at law) and (2) except as
rights to indemnity thereunder may be limited by federal or state securities
laws.
iv. Neither (A) the execution and delivery by the Investment Manager of any
Investment Manager Agreement nor (B) the consummation by the Investment Manager
of the transactions contemplated by, or the performance of its obligations under
any Investment Manager Agreement conflicts or will conflict with, or results or
will result in a breach of, the charter or by-laws of the Investment Manager or
any agreement or instrument to which the Investment Manager is a party or by
which the Investment Manager is bound, or any federal or Delaware law, rule or
regulation, or order of any court, governmental instrumentality, securities
exchange or association or arbitrator, whether foreign or domestic, specifically
naming the Investment Manager and known to counsel, except in each case for such
conflicts or breaches which do not, either alone or in the aggregate, have a
material adverse effect on the Investment Manager's ability to perform its
obligations under the Investment Manager Agreements.
v. To my knowledge, no consent, approval, authorization or order of any
court, governmental agency or body or securities exchange or association,
whether foreign or domestic, is required for the consummation of the
transactions contemplated in, or the performance by the Investment Manager of
its obligations under, any Investment Manager Agreement, except (i) such as have
been obtained under the federal securities laws and (ii) may be required by the
American Stock Exchange or under state securities or "blue sky" laws, in
connection with the purchase and distribution of the Shares by the Underwriters
pursuant to the Underwriting Agreement.
vii. To my knowledge, there is no legal or governmental proceeding pending
or threatened against the Investment Manager that is either (i) required to be
described in the Registration Statement or Prospectus that is not already
described or (ii) which would, under Section 9 of the Investment Company Act,
make the Investment Manager ineligible to act as the Fund's investment manager.
I have not 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. No facts have come to my attention that cause me to
believe that the description of the Investment Manager and its business, and the
statements attributable to the Investment Manager, in the Registration
Statement, at the time it became effective (but after giving effect to any
changes incorporated pursuant to Rule 430A under the Act), contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading
(except that I express no such view with respect to the financial statements,
including notes and schedules thereto, or any other financial or accounting data
included therein), or that the description of the Investment Manager and its
business, and the statements attributable to the Investment Manager, in the
Prospectus, as of the date it was filed with the Commission pursuant to Rule 497
under the Act and as of the date hereof, contained or contains an untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (except that I express
no such view with respect to the financial statements, including notes and
schedules thereto, or any other financial or accounting data included therein).
C-2
SCHEDULE D
FORM OF OPINION OF INTERNAL COUNSEL
REGARDING RREEF AMERICA L.L.C.
I am internal general counsel to RREEF America L.L.C. (the "Investment
Advisor"). This opinion letter is limited solely to matters relating to the
Investment Advisor, and not its control persons or affiliates, and to its
agreement relating to investment advisory services (the "Investment Advisory
Agreement") to the ▇▇▇▇▇▇▇ RREEF Real Estate Fund II, Inc. (the "Fund"). Except
as otherwise noted, capitalized terms shall have the same meaning as in the
Underwriting Agreement, dated as of the date hereof, relating to the Fund.
This opinion letter shall be governed by, and interpreted in accordance
with, the Legal Opinion Accord (the "Accord") of the ABA Section of Business Law
(1991). Consequently, it is subject to a number of qualifications, exceptions,
definitions, limitations on coverage and other limitations, all as more
particularly described in the Accord, and this opinion letter should be read in
conjunction therewith. I am a member of the bar of the State of Illinois, and
law covered by the opinions expressed herein is limited to the Federal Law of
the United States and the Law of the State of Illinois.
Subject to each of the qualifications, exceptions, definitions,
limitations set forth in this opinion letter and the Accord, it is my opinion
that:
i. The Investment Advisor has been duly formed and is validly
existing as a limited liability company under the laws of its
jurisdiction of organization with full power and authority to
own or lease all of the assets owned or leased by it and to
conduct its business as described in the Registration
Statement and Prospectus and to enter into and perform its
obligations under the Investment Advisory Agreement.
ii. The Investment Advisor is duly registered as an investment
advisor under the Investment Advisers Act of 1940, as amended
(the "Adviser Act"), and is not prohibited by the Advisers Act
or the Investment Company Act of 1940, as amended (the
"Investment Company Act"), from acting as investment advisor
for the Fund as contemplated by the Investment Advisory
Agreement, the Registration Statement and the Prospectus.
iii. The Investment Advisor has full power and authority to enter
into the Investment Advisory Agreement and to carry out all
the terms and provisions thereof to be carried out by it, and
such agreement has been duly and validly authorized, executed
and delivered by the Investment Advisor; the Investment
Advisory Agreement complies in all material respects with all
provisions of the Investment Company Act and the Advisers Act;
and assuming due authorization, execution and delivery by the
other parties thereto, the Investment Advisory Agreement
constitutes a legal, valid and binding obligation of the
Investment Advisor, enforceable
against the Investment Advisor in accordance with its terms,
subject to the enforceability limitations stated in paragraph
A of this opinion letter.
iv. Neither (A) the execution and delivery by the Investment
Advisor of the Investment Advisory Agreement nor (B) the
consummation by the Investment Advisor of the transactions
contemplated by, or the performance of its obligations under
the Investment Advisory Agreement conflicts or will conflict
with, or results or will result in a breach of, the
organizational or operational documents of the Investment
Adviser or, to my knowledge, any agreement or instrument to
which the Investment Adviser is a party or by which the
Investment Adviser is bound, or any federal law, rule or
regulation, or order of any court, governmental
instrumentality, securities exchange or association or
arbitrator, whether foreign or domestic, applicable to the
Investment Adviser, except in each case for such conflicts or
breaches which do not, either alone or in the aggregate, have
a material adverse effect on the Investment Adviser's ability
to perform its obligations under the Investment Advisory
Agreement.
v. To my knowledge, in connection with the purchase and
distribution of the Shares by the Underwriters pursuant to the
Underwriting Agreement, no consent, approval, authorization or
order of any court, governmental agency or body or securities
exchange or association, whether foreign or domestic, is
required for the consummation of the transactions contemplated
in, or the performance by the Investment Advisor of its
obligations under, the Investment Advisory Agreement, except
such as may be required (i) under the federal securities laws,
(ii) by the American Stock Exchange, or (iii) under state
securities or "blue sky" laws.
vii. To my knowledge, there is no legal or governmental proceeding
pending or threatened against the Investment Advisor that is
either (i) required to be described in the Registration
Statement or Prospectus that is not already described or (ii)
would, under Section 9 of the Investment Company Act, make the
Investment Advisor ineligible to act as the Fund's investment
advisor.
I have not checked the accuracy and completeness of or otherwise
verified, and am not passing upon and assume no responsibility for the accuracy
or completeness of, the statements contained in the Registration Statement or
the Prospectus. No facts have come to my attention that cause me to believe that
the description of the Investment Advisor and its business, and the statements
attributable to the Investment Advisor, in the Registration Statement, at the
time it became effective (but after giving effect to any changes incorporated
pursuant to Rule 430A under the Act), contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading (except that we
express no such view with respect to the financial statements, including notes
and schedules thereto, or any other financial or accounting data included
therein), or that the description of the
D-2
Investment Advisor and its business, and the statements attributable to the
Investment Advisor, in the Prospectus, as of the date it was filed with the
Commission pursuant to Rule 497 under the Act and as of the date hereof,
contained or contains an untrue statement of a material fact or omitted or omits
to state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading
(except that we express no such view with respect to the financial statements,
including notes and schedules thereto, or any other financial or accounting data
included therein).
I have made such investigation and examined such documents, entity
records, instruments, public records and matters of law as I have deemed
necessary or advisable for the purposes of this opinion. In addition, I have
assumed (i) the genuineness of the signatures of persons signing all documents
in connection with which this opinion is rendered, (ii) the authenticity of all
documents submitted to me as originals, (iii) conformity to authenticated
original documents of all documents submitted to me as certified, conformed,
photocopied or facsimile copies, (iv) the accuracy of the representations and
warranties in documents as to factual matters, and (v) the due authorization,
execution and delivery of any agreements or documents discussed in this opinion.
The foregoing opinions are further limited and qualified as follows:
A. The opinions on enforceability are subject to limitations
resulting from the effects of (i) bankruptcy, insolvency,
reorganization, receivership, moratorium, fraudulent
conveyance, arrangement and assignment for the benefit of
creditors laws and similar laws or judicially developed
doctrines; (ii) general principles of equity, whether applied
by a court of law or equity; and (iii) other generally
applicable rules of law which limit or affect the enforcement
of contracts which purport to waive obligations of good faith,
fair dealing, diligence or reasonableness, or which limit
liability or require indemnification for actions or inactions.
B. I disclaim any opinion as to (i) the validity or
enforceability of any liability limitation provisions of any
documents and (ii) any provisions relating to choice of
governing law, which choice may depend upon factual
circumstances and the laws of other jurisdictions.
The opinions expressed herein are expressed as of the date first
indicated above without any undertaking to amend or supplement this opinion
letter to take into account or inform you of any changes in law or fact of which
we become aware after the date hereof.
This opinion letter may be relied upon by you only in connection with
the transactions discussed herein and may not be used or relied upon by you or
any other person for any purpose whatsoever except to the extent authorized in
the Accord, and may not be disclosed, quoted, published or otherwise circulated,
without in each instance our prior written consent.
D-3
SCHEDULE E
FORM OF ACCOUNTANT'S LETTER
[ ] , 2003
The Board of Directors of
▇▇▇▇▇▇▇ RREEF Real Estate Fund II, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
UBS Securities LLC
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as Managing Representative of the Underwriters
Ladies and Gentlemen:
We have audited the statement of assets and liabilities of
▇▇▇▇▇▇▇ RREEF Real Estate Fund II, Inc. (the "Fund") as of [ ], 2003 included in
the Registration Statement on Form N-2 filed by the Fund under the Securities
Act of 1933 (the "Act") (File No. 333-______) and under the Investment Company
Act of 1940 (the "1940 Act") (File No. 811-______); such statement and our
report with respect to such statement are included in the Registration
Statement.
In connection with the Registration Statement:
1. We are independent public accountants with respect to the
Fund within the meaning of the Act and the applicable rules and
regulations thereunder.
2. In our opinion, the statement of assets and liabilities
included in the Registration Statement and audited by us complies as to
form in all respects with the applicable accounting requirements of the
Act, the 1940 Act and the respective rules and regulations thereunder.
3. For purposes of this letter we have read the minutes of all
meetings of the Shareholders, the Board of Directors and all Committees
of the Board of Directors of the Fund as set forth in the minute books
at the offices of the Fund, officials of the Fund having advised us
that the minutes of all such meetings through _________, 2003, were set
forth therein.
4. Fund officials have advised us that no financial statements
as of any date subsequent to _______, 2003, are available. We have made
inquiries of certain officials of the Fund who have responsibility for
financial and accounting matters regarding whether there was any change
at _______, 2003, in the capital
shares or net assets of the Fund as compared with amounts shown in the
_______, 2002, statement of assets and liabilities included in the
Registration Statement, except for changes that the Registration
Statement discloses have occurred or may occur. On the basis of our
inquiries and our reading of the minutes as described in Paragraph 3,
nothing came to our attention that caused us to believe that there were
any such changes.
The foregoing procedures do not constitute an audit made in accordance
with generally accepted auditing standards. Accordingly, we make no
representations as to the sufficiency of the foregoing procedures for your
purposes.
This letter is solely for the information of the addressees and to
assist the underwriters in conducting and documenting their investigation of the
affairs of the Fund in connection with the offering of the securities covered by
the Registration Statement, and is not to be used, circulated, quoted or
otherwise referred to within or without the underwriting group for any other
purpose, including but not limited to the registration, purchase or sale of
securities, nor is it to be filed with or referred to in whole or in part in the
Registration Statement or any other document, except that reference may be made
to it in the underwriting agreement or in any list of closing documents
pertaining to the offering of the securities covered by the Registration
Statement.
Very Truly Yours,
E-2