__________ Shares
ALLIANCE [CALIFORNIA] [NEW YORK] MUNICIPAL INCOME FUND, INC.
Common Stock
UNDERWRITING AGREEMENT
January __, 2002
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
Prudential Securities Incorporated
UBS Warburg LLC
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Co.
Wedbush ▇▇▇▇▇▇ Securities, Inc.
▇▇▇▇▇ FargoVan ▇▇▇▇▇▇, LLC
As Representatives of the Several Underwriters
c/o ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
The undersigned, Alliance [California] [New York]
Municipal Income Fund, Inc., a Maryland corporation (the "Fund"),
and Alliance Capital Management L.P., a Delaware limited
partnership (the "Manager"), address you as Underwriters and as
the representatives (the "Representatives") of each of the other
persons, firms and corporations, if any, listed in Schedule I
hereto (herein collectively called "Underwriters"). The Fund
proposes to issue and sell an aggregate of ___________ shares
(the "Firm Shares") of its common stock, $.001 par value per
share (the "Common Shares"), to the several Underwriters. The
Fund also proposes to sell to the Underwriters, upon the terms
and conditions set forth in Section 2 hereof, up to an additional
___________ Common Shares (the "Additional Shares"). The Firm
Shares and Additional Shares are hereinafter collectively
referred to as the "Shares".
The Fund and the Manager wish to confirm as follows
their agreements with you and the other several Underwriters on
whose behalf you are acting in connection with the several
purchases of the Shares by the Underwriters.
The Fund is entering into an investment management
agreement with the Manager dated January 24, 2002, a custody
agreement with State Street Bank & Trust Company dated January
24, 2002 and a shareholder transfer agency agreement with
Equiserve Trust Company, N.A. dated January 24, 2002, and such
agreements are herein referred to as the "Management Agreement",
the "Custodian Agreement" and the "Transfer Agency Agreement",
respectively. Collectively, the Management Agreement, the
Custodian Agreement and the Transfer Agency Agreement are herein
referred to as the "Fund Agreements". This Underwriting
Agreement is herein referred to as the "Agreement".
1. Registration Statement and Prospectus. The Fund
has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions
of the Securities Act of 1933, as amended (the "1933 Act"), the
Investment Company Act of 1940, as amended (the "1940 Act"), and
the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Rules and Regulations") and the 1940 Act (the
"1940 Act Rules and Regulations" and together with the 1933 Act
Rules and Regulations, the "Rules and Regulations") a
registration statement on Form N-2 (File No. 333-73134) under the
1933 Act and the 1940 Act and may pursuant to the Rules and
Regulations prepare and file an additional registration statement
relating to a portion of the Shares pursuant to Rule 462(b) of
the 1933 Act Rules and Regulations (collectively, the
"registration statement"), including a prospectus (including any
statement of additional information) relating to the Shares and a
notification of registration of the Fund as an investment company
under the 1940 Act on Form N-8A (the "1940 Act Notification").
The term "Registration Statement" as used in this Agreement means
the registration statement (including all financial schedules and
exhibits), as amended at the time it becomes effective under the
1933 Act or, if the registration statement became effective under
the 1933 Act prior to the execution of this Agreement, as amended
or supplemented, prior to the execution of this Agreement and
includes any information deemed to be included by Rule 430A under
the 1933 Act Rules and Regulations. If it is contemplated, at
the time this Agreement is executed, that a post-effective
amendment to the registration statement will be filed under the
1933 Act and must be declared effective before the offering of
the Shares may commence, the term "Registration Statement" as
used in this Agreement means the registration statement as
amended by said post-effective amendment. The term "Prospectus"
as used in this Agreement means the prospectus (including the
statement of additional information) in the form included in the
Registration Statement or, if the prospectus (including the
statement of additional information) included in the Registration
Statement omits information in reliance on Rule 430A and such
information is included in a prospectus (including the statement
of additional information) filed with the Commission pursuant to
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Rule 497(h) under the 1933 Act Rules and Regulations, the term
"Prospectus" as used in this Agreement means the prospectus
(including the statement of additional information) in the form
included in the Registration Statement as supplemented by the
addition of the information contained in the prospectus
(including the statement of additional information) filed with
the Commission pursuant to Rule 497(h). The term "Prepricing
Prospectus" as used in this Agreement means the prospectus
(including the statement of additional information) subject to
completion in the form included in the registration statement at
the time of the initial filing of the registration statement with
the Commission and as such prospectus (including the statement of
additional information) shall have been amended from time to time
prior to the date of the Prospectus, together with any other
prospectus (including any other statement of additional
information) relating to the Fund other than the Prospectus.
The Fund has furnished the Representatives with copies
of such registration statement, each amendment to such
registration statement filed with the Commission and each
Prepricing Prospectus.
2. Agreements to Sell and Purchase. The Fund hereby
agrees, subject to all the terms and conditions set forth herein,
to issue and to sell to each Underwriter and, upon the basis of
the representations, warranties and agreements of the Fund and
the Manager herein contained and subject to all of the other
terms and conditions set forth herein, each Underwriter agrees,
severally and not jointly, to purchase from the Fund at a
purchase price per share of $14.325 per Share (the "purchase
price per share"), the number of Firm Shares set forth opposite
the name of such Underwriter in Schedule I hereto (or such number
of Firm Shares increased as set forth in Section 10 hereof).
The Fund also agrees, subject to all the terms and
conditions set forth herein, to issue and to sell to the
Underwriters and, upon the basis of the representations,
warranties and agreements of the Fund and the Manager herein
contained and subject to all the terms and conditions set forth
herein, the Underwriters shall have the right to purchase from
the Fund, at the purchase price per share, pursuant to an option
(the "over-allotment option") which may be exercised at any time
and from time to time prior to 9:00 P.M., New York City time, on
the 45th day after the date of the Prospectus (or if such 45th
day shall be a Saturday or a Sunday or a holiday, on the next
business day thereafter when the New York Stock Exchange (the
"NYSE") is open for trading) up to an aggregate of ____________
Additional Shares. Additional Shares may be purchased solely for
the purpose of covering over-allotments made in connection with
the offering of the Firm Shares. Upon any exercise of the
over-allotment option, upon the basis of the representations,
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warranties and agreements of the Fund and the Manager herein
contained and subject to all of the other terms and conditions
set forth herein, each Underwriter agrees, severally and not
jointly, to purchase from the Fund the number of Additional
Shares (subject to such adjustments as you may determine to avoid
fractional shares) which bears the same proportion to the number
of Additional Shares to be purchased by the Underwriters as the
number of Firm Shares set forth opposite the name of such
Underwriter in Schedule I (or such number of Firm Shares
increased as set forth in Section 10 hereof) bears to the
aggregate number of Firm Shares.
3. Terms of Public Offering. The Fund and the Manager
have been advised by you that the Underwriters propose to make a
public offering of their respective portions of the Firm Shares
as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable and initially
to offer the Firm Shares upon the terms set forth in the
Prospectus.
4. Delivery of Shares and Payments Therefor.
(a) Delivery to the Underwriters of and payment to
the Fund for the Firm Shares and payment of all amounts
due to the Underwriters under Section 12 hereof shall be
made at the office of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ or through
the facilities of the Depository Trust Company or
another mutually agreeable facility, at 9:00 A.M., New
York City time, on _________ __, 2002 (the "Closing
Date"). The place of closing for the Firm Shares and the
Closing Date may be varied by agreement between you and
the Fund.
(b) Delivery to the Underwriters of and payment to
the Fund for any Additional Shares to be purchased by
the Underwriters and payment of all amounts due to the
Underwriters under Section 12 hereof shall be made at
the aforementioned office of ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
at such time and on such date (an "Option Closing
Date"), which may be the same as the Closing Date, but
shall in no event be earlier than the Closing Date nor
earlier than two nor later than three business days
after the giving of the notice hereinafter referred to,
as shall be specified in a written notice from you on
behalf of the Underwriters to the Fund of the
Underwriters' determination to purchase a number,
specified in said notice, of Additional Shares. The
place of closing for any Additional Shares and the
Option Closing Date for such Additional Shares may be
varied by agreement between you and the Fund.
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(c) Certificates for the Firm Shares and for any
Additional Shares shall be registered in such names and
in such denominations as you shall request prior to 1:00
P.M., New York City time, (i) in respect of the Firm
Shares, on the second business day preceding the Closing
Date and (ii) in respect of Additional Shares, on the
day of the giving of the written notice in respect of
such Additional Shares. Such certificates will be made
available to you in New York City for inspection and
packaging not later than 9:00 A.M., New York City time,
on the business day next preceding the Closing Date or
any Option Closing Date, as the case may be. The
certificates evidencing the Firm Shares and any
Additional Shares to be purchased hereunder shall be
delivered to you on the Closing Date or the Option
Closing Date, as the case may be, against payment of the
purchase price therefor in same-day funds to the order
of the Fund.
5. Agreements of the Fund and the Manager. The Fund
and the Manager, jointly and severally, agree with the several
Underwriters as follows:
(a) If, at the time this Agreement is executed and
delivered, it is necessary for the Registration
Statement or a post-effective amendment thereto to be
declared effective under the 1933 Act before the
offering of the Firm Shares may commence, the Fund will
use its reasonable best efforts to cause the
Registration Statement or such post-effective amendment
to become effective under the 1933 Act as soon as
possible. If the Registration Statement has become
effective and the Prospectus contained therein omits
certain information at the time of effectiveness
pursuant to Rule 430A of the 1933 Act Rules and
Regulations, the Fund will file a prospectus including
such information pursuant to Rule 497(h) of the 1933 Act
Rules and Regulations, as promptly as practicable, but
no later than the second business day following the
earlier of the date of the determination of the offering
price of the Shares or the date the Prospectus is first
used after the effective date of the Registration
Statement. If the Registration Statement has become
effective and the Prospectus contained therein does not
so omit such information, the Fund will file a
Prospectus or a certification pursuant to Rule 497 (c)
or (j), as applicable, of the 1933 Act Rules and
Regulations as promptly as practicable, but no later
than the fifth business day following the date of the
later of the effective date of the Registration
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Statement or the commencement of the public offering of
the Shares after the effective date of the Registration
Statement. The Fund will advise you promptly and, if
requested by you, will confirm such advice in writing
(i) when the Registration Statement or such
post-effective amendment has become effective and (ii)
when the Prospectus has been timely filed pursuant to
Rule 497(c) or Rule 497(h) of the 1933 Act Rules and
Regulations or the certification permitted pursuant to
Rule 497(j) of the 1933 Act Rules and Regulations has
been timely filed, whichever is applicable.
(b) The Fund will advise you promptly and, if
requested by you, will confirm such advice in writing:
(i) of any request made by the Commission for amendment
of or a supplement to the Registration Statement, any
Prepricing Prospectus or the Prospectus (or any
amendment or supplement to any of the foregoing) or for
additional information, (ii) of the issuance by the
Commission, the National Association of Securities
Dealers, Inc. (the "NASD"), any state securities
commission, any national securities exchange, any
arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or
any official suspending the effectiveness of the
Registration Statement, prohibiting or suspending the
use of the Prospectus, any Prepricing Prospectus or any
sales material (as hereinafter defined), of any notice
pursuant to Section 8(e) of the 1940 Act, of the
suspension of qualification of the Shares for offering
or sale in any jurisdiction, or the initiation or
contemplated initiation of any proceeding for any such
purposes, (iii) of receipt by the Fund, the Manager or
any affiliate of the Fund or any representative or
attorney of the Fund or the Manager of any other
material communication from the Commission, the NASD,
any state securities commission, any national securities
exchange, any arbitrator, any court or any other
governmental, regulatory, self-regulatory or
administrative agency or any official relating to the
Fund (if such communication relating to the Fund is
received by such person within three years after the
date of this Agreement), the Registration Statement, the
1940 Act Notification, the Prospectus, any Prepricing
Prospectus, any sales material (as hereinafter defined)
(or any amendment or supplement to any of the
foregoing), this Agreement or any of the Fund Agreements
and (iv) within the period of time referred to in
paragraph (f) below, of any material adverse change in
the condition (financial or other), business, prospects,
properties, net assets or results of operations of the
6
Fund or the Manager or of the happening of any event
which makes any statement of a material fact made in the
Registration Statement, the Prospectus, any Prepricing
Prospectus or any sales material (as herein defined) (or
any amendment or supplement to any of the foregoing)
untrue or which requires the making of any additions to
or changes in the Registration Statement, the
Prospectus, any Prepricing Prospectus or any sales
materials (as herein defined) (or any amendment or
supplement to any of the foregoing) in order to state a
material fact required by the 1933 Act, the 1940 Act or
the Rules and Regulations to be stated therein or
necessary in order to make the statements therein (in
the case of a prospectus, in light of the circumstances
under which they were made) not misleading or of the
necessity to amend or supplement the Registration
Statement, the Prospectus, any Prepricing Prospectus or
any sales material (as herein defined) (or any amendment
or supplement to any of the foregoing) to comply with
the 1933 Act, the 1940 Act, the Rules and Regulations or
any other law or order of any court or regulatory body.
If at any time the Commission, the NASD, any state
securities commission, any national securities exchange,
any arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or
any official shall issue any order suspending the
effectiveness of the Registration Statement, prohibiting
or suspending the use of the Prospectus, any Prepricing
Prospectus or any sales material (as hereinafter
defined) (or any amendment or supplement to any of the
foregoing) or suspending the qualification of the Shares
for offering or sale in any jurisdiction, the Fund will
use its reasonable best efforts to obtain the withdrawal
of such order at the earliest possible time.
(c) The Fund will furnish to you, without charge,
three signed copies of the registration statement and
the 1940 Act Notification as originally filed with the
Commission and of each amendment thereto, including
financial statements and all exhibits thereto (except
any post-effective amendment required by Rule 8b-16 of
the 1940 Act Rules and Regulations which is filed with
the Commission after the later of (x) one year from the
date of this Agreement and (y) the date on which the
distribution of the Shares is completed) and will also
furnish to you, without charge, such number of conformed
copies of the registration statement as originally filed
and of each amendment thereto (except any post-effective
amendment required by Rule 8b-16 of the 1940 Act Rules
and Regulations which is filed with the Commission after
the later of (x) one year from the date of this
7
Agreement and (y) the date on which the distribution of
the Shares is completed), with or without exhibits, as
you may reasonably request.
(d) The Fund will not (i) file any amendment to
the Registration Statement or make any amendment or
supplement to the Prospectus, any Prepricing Prospectus
or any sales material (as hereinafter defined) (or any
amendment or supplement to any of the foregoing) of
which you shall not previously have been advised or to
which you shall reasonably object within a reasonable
time after being so advised or (ii) so long as, in the
opinion of counsel for the Underwriters, a Prospectus is
required to be delivered in connection with sales by any
Underwriter or dealer, file any information, documents
or reports pursuant to the Securities Exchange Act of
1934, as amended (the "1934 Act"), without delivering a
copy of such information, documents or reports to you,
as Representatives of the Underwriters, prior to or
concurrently with such filing.
(e) Prior to the execution and delivery of this
Agreement, the Fund has delivered to you, without
charge, in such quantities as you have reasonably
requested, copies of each form of any Prepricing
Prospectus. The Fund consents to the use, in accordance
with the provisions of the 1933 Act and with the
securities or Blue Sky laws of the jurisdictions in
which the Shares are offered by the several Underwriters
and by dealers, prior to the date of the Prospectus, of
each Prepricing Prospectus so furnished by the Fund.
(f) As soon after the execution and delivery of
this Agreement as possible and thereafter from time to
time, for such period as in the opinion of counsel for
the Underwriters a prospectus is required by the 1933
Act to be delivered in connection with sales of Shares
by any Underwriter or dealer, the Fund will
expeditiously deliver to each Underwriter and each
dealer, without charge, as many copies of the Prospectus
(and of any amendment or supplement thereto) as you may
reasonably request. The Fund consents to the use of the
Prospectus (and of any amendments or supplements
thereto) in accordance with the provisions of the 1933
Act and with the securities or Blue Sky laws of the
jurisdictions in which the Shares are offered by the
several Underwriters and by all dealers to whom Shares
may be sold, both in connection with the offering or
sale of the Shares and for such period of time
thereafter as the Prospectus is required by law to be
delivered in connection with sales of Shares by any
8
Underwriter or dealer. If during such period of time
any event shall occur that in the judgment of the Fund
or in the opinion of counsel for the Underwriters is
required to be set forth in the Prospectus (as then
amended or supplemented) or should be set forth therein
in order to make the statements therein, in light of the
circumstances under which they were made, not misleading
or if it is necessary to supplement or amend the
Prospectus to comply with the 1933 Act, the 1940 Act,
the Rules and Regulations or any other law, rule or
regulation, the Fund will forthwith prepare and, subject
to the provisions of paragraph (d) above, file with the
Commission an appropriate amendment or supplement
thereto and will expeditiously furnish to the
Underwriters and dealers, without charge, such number of
copies thereof as they shall reasonably request. In the
event that the Prospectus is to be amended or
supplemented, the Fund, if requested by you, will
promptly issue a press release announcing or disclosing
the matters to be covered by the proposed amendment or
supplement.
(g) The Fund will cooperate with you and with
counsel for the Underwriters in connection with the
registration or qualification of the Shares for offering
and sale by the several Underwriters and by dealers
under the securities or Blue Sky laws of such
jurisdictions as you may designate and will file such
consents to service of process or other documents
necessary or appropriate in order to effect such
registration or qualification; provided that in no event
shall the Fund be obligated to qualify to do business in
any jurisdiction where it is not now so qualified or to
take any action which would subject it to service of
process in suits, other than those arising out of the
offering or sale of the Shares, in any jurisdiction
where it is not now so subject.
(h) The Fund will make generally available to its
security holders an earnings statement, which need not
be audited, covering a twelve-month period commencing
after the effective date of the Registration Statement
and ending not later than 15 months thereafter, as soon
as practicable after the end of such period, which
earnings statement shall satisfy the provisions of
Section 11(a) of the 1933 Act and Rule 158 of the 1933
Act Rules and Regulations.
(i) The Fund will comply with the undertaking set
forth in paragraph 6 of Item 33 of Part C of the
Registration Statement.
9
(j) During the period of five years hereafter, the
Fund will furnish to you (i) as soon as available, a
copy of each report of the Fund mailed to shareholders
or filed with the Commission and (ii) from time to time
such other information concerning the Fund as you may
reasonably request.
(k) If this Agreement shall terminate or shall be
terminated after execution pursuant to any provisions
hereof (other than pursuant to the second paragraph of
Section 10 hereof or by notice given by you terminating
this Agreement pursuant to Section 10 or Section 11
hereof) or if this Agreement shall be terminated by the
Underwriters because of any failure or refusal on the
part of the Fund or the Manager to comply with the terms
or fulfill any of the conditions of this Agreement, the
Fund and the Manager, jointly and severally, agree to
reimburse the Representatives for all out-of-pocket
expenses (including fees and expenses of counsel for the
Underwriters) incurred by you in connection herewith,
but the Fund and the Manager shall in no event be liable
for any internal cost of the Underwriters or any loss of
anticipated profits or speculative, consequential or
similar damages for such termination.
(l) 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 objectives, policies
and restrictions of the Fund as described in the
Prospectus.
(m) The Fund will file the requisite copies of the
Prospectus with the Commission in a timely fashion
pursuant to Rule 497(c) or Rule 497(h) of the 1933 Act
Rules and Regulations, whichever is applicable or, if
applicable, will file in a timely fashion the
certification permitted by Rule 497(j) of the 1933 Act
Rules and Regulations and will advise you of the time
and manner of such filing.
(n) Except as provided in this Agreement or
pursuant to any dividend reinvestment plan of the Fund
in effect on the date hereof, the Fund will not sell,
contract to sell or otherwise dispose of, any Common
Shares or any securities convertible into or exercisable
or exchangeable for Common Shares or grant any options
or warrants to purchase Common Shares, for a period of
180 days after the date of the Prospectus, without the
prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
10
(o) Except as stated in this Agreement and in the
Prospectus, neither the Fund nor the Manager has taken,
nor will it take, directly or indirectly, any action
designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the
price of the Common Shares.
(p) The Fund will use its reasonable best efforts
to have the Common Shares listed, subject to notice of
issuance, on the NYSE concurrently with the
effectiveness of the Registration Statement and to
comply with the rules and regulations of such exchange.
6. Representations and Warranties of the Fund and the
Manager. The Fund and the Manager, jointly and severally,
represent and warrant to each Underwriter that:
(a) Each Prepricing Prospectus included as part of
the registration statement as originally filed or as
part of any amendment or supplement thereto complied
when so filed in all material respects with the
provisions of the 1933 Act, the 1940 Act and the Rules
and Regulations.
(b) The Registration Statement, in the form in
which it became or becomes effective and also in such
form as it may be when any post-effective amendment
thereto shall become effective and the Prospectus and
any amendment or supplement thereto when filed with the
Commission under Rule 497 of the 1933 Act Rules and
Regulations and the 1940 Act Notification when
originally filed with the Commission and any amendment
or supplement thereto when filed with the Commission
complied or will comply in all material respects with
the provisions of the 1933 Act, the 1940 Act and the
Rules and Regulations and did not or will not at any
such times contain an untrue statement of a material
fact or omit to state a material fact required to be
stated therein or necessary to make the statements
therein (in the case of a prospectus, in light of the
circumstances under which they were made) not
misleading; except that this representation and warranty
does not apply to statements in or omissions from the
Registration Statement or the Prospectus (or any
amendment or supplement thereto) made in reliance upon
and in conformity with information relating to any
Underwriter furnished to the Fund by or on behalf of any
Underwriter through you expressly for use therein.
11
(c) All the outstanding Common Shares of the Fund
have been duly authorized and validly issued, are fully
paid and, except as described in the Registration
Statement, nonassessable and are free of any preemptive
or similar rights; the Shares have been duly authorized
and, when issued and delivered to the Underwriters
against payment therefor in accordance with the terms
hereof, will be validly issued, fully paid and, except
as described in the Registration Statement,
nonassessable and free of any preemptive or similar
rights and the capital stock of the Fund conforms to the
description thereof in the Registration Statement and
the Prospectus (and any amendment or supplement to
either of them).
(d) The Fund has been duly incorporated and is
validly existing as a corporation in good standing under
the laws of the State of Maryland, with full corporate
power and authority to own, lease and operate its
properties and to conduct its business as described in
the Registration Statement and the Prospectus (and any
amendment or supplement to either of them) and is duly
registered and qualified to conduct business and is in
good standing in each jurisdiction or place where the
nature of its properties or the conduct of its business
requires such registration or qualification, except
where the failure so to register or to qualify does not
have a material, adverse effect on the condition
(financial or other), business, properties, net assets
or results of operations of the Fund. The Fund has no
subsidiaries.
(e) There are no legal or governmental proceedings
pending or, to the knowledge of the Fund, threatened,
against the Fund or to which the Fund or any of its
properties is subject, that are required to be described
in the Registration Statement or the Prospectus (or any
amendment or supplement to either of them) but are not
described as required and there are no agreements,
contracts, indentures, leases or other instruments that
are required to be described in the Registration
Statement or the Prospectus (or any amendment or
supplement to either of them) or to be filed as an
exhibit to the Registration Statement that are not
described or filed as required by the 1933 Act, the 1940
Act or the Rules and Regulations.
(f) The Fund is not in violation of its Articles
of Incorporation or By-Laws or in material violation of
any law, ordinance, administrative or governmental rule
or regulation applicable to the Fund or of any decree of
12
the Commission, the NASD, any state securities
commission, any national securities exchange, any
arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or
any official having jurisdiction over the Fund or in
breach or default in the performance of any obligation,
agreement or condition contained in any material bond,
debenture, note or any other evidence of indebtedness or
in any agreement, indenture, lease or other instrument
to which the Fund is a party or by which it or any of
its properties may be bound.
(g) Neither the issuance and sale of the Shares,
the execution, delivery or performance of this Agreement
nor any of the Fund Agreements by the Fund, nor the
consummation by the Fund of the transactions
contemplated hereby or thereby (A) requires any consent,
approval, authorization or other order of or
registration or filing with the Commission, the NASD,
any national securities exchange, any arbitrator, any
court or any other governmental, regulatory,
self-regulatory or administrative agency or any official
(except compliance with the securities or Blue Sky laws
of various jurisdictions which have been or will be
effected in accordance with this Agreement and except
for compliance with the filing requirements of the NASD
Division of Corporate Finance) or conflicts or will
conflict with or constitutes or will constitute a breach
of the Articles of Incorporation or By-Laws of the Fund
or (B) conflicts or will conflict with or constitutes or
will constitute a breach of or a default under, any
material agreement, indenture, lease or other instrument
to which the Fund is a party or by which it or any of
its properties may be bound or violates or will violate
any material statute, law, regulation or filing or
judgment, injunction, order or decree applicable to the
Fund or any of its properties or will result in the
creation or imposition of any material lien, charge or
encumbrance upon any property or assets of the Fund
pursuant to the terms of any agreement or instrument to
which it is a party or by which it may be bound or to
which any of the property or assets of the Fund is
subject.
(h) Since the date as of which information is
given in the Registration Statement and the Prospectus
(and any amendment or supplement to either of them),
except as otherwise stated therein, (A) there has been
no material, adverse change in the condition (financial
or other), business, properties, net assets or results
of operations of the Fund or business prospects (other
13
than as a result of a change in the financial markets
generally) of the Fund, whether or not arising in the
ordinary course of business, (B) there have been no
transactions entered into by the Fund which are material
to the Fund other than those in the ordinary course of
its business as described in the Prospectus (and any
amendment or supplement thereto) and (C) there has been
no dividend or distribution of any kind declared, paid
or made by the Fund on any class of its common stock.
(i) The accountants, Ernst & Young LLP, who have
audited or shall audit the Statement of Assets and
Liabilities included in the Registration Statement and
the Prospectus (and any amendment or supplement to
either of them), are an independent public accounting
firm as required by the 1933 Act, the 1940 Act and the
Rules and Regulations.
(j) The financial statements, together with
related schedules and notes, included in the
Registration Statement or the Prospectus (or any
amendment or supplement to either of them) present
fairly the financial position of the Fund on the basis
stated in the Registration Statement at the respective
dates or for the respective periods to which they apply;
such statements and related schedules and notes have
been prepared in accordance with generally accepted
accounting principles consistently applied throughout
the periods involved except as disclosed therein; and
the other financial and statistical information and data
included in the Registration Statement or the Prospectus
(or any amendment or supplement thereto) are accurately
derived from such financial statements and the books and
records of the Fund.
(k) The Fund, subject to the Registration
Statement having been declared effective and the filing
of the Prospectus under Rule 497 under the Rules and
Regulations, has taken all required action under the
1933 Act, the 1940 Act and the Rules and Regulations to
make the public offering and consummate the sale of the
Shares as contemplated by this Agreement.
(l) The execution and delivery of and the
performance by the Fund of its obligations under this
Agreement and the Fund Agreements have been duly and
validly authorized by the Fund and this Agreement and
the Fund Agreements have been duly executed and
delivered by the Fund and constitute the valid and
legally binding agreements of the Fund, enforceable
against the Fund in accordance with their terms, except
14
as rights to indemnity and contribution hereunder may be
limited by federal or state securities laws and subject
to the qualification that the enforceability of the
Fund's obligations hereunder and thereunder may be
limited by bankruptcy, insolvency, reorganization,
moratorium and other laws relating to or affecting
creditors' rights generally and by general equitable
principles.
(m) Except as disclosed in the Registration
Statement and the Prospectus (and any amendment or
supplement to either of them), subsequent to the
respective dates as of which such information is given
in the Registration Statement and the Prospectus (and
any amendment or supplement to either of them), the Fund
has not incurred any liability or obligation, direct or
contingent, or entered into any transaction, not in the
ordinary course of business, that is material to the
Fund and there has not been any change in the capital
stock or material increase in the short-term debt or
long-term debt of the Fund or any material, adverse
change or any development involving or which should
reasonably be expected to involve a prospective
material, adverse change in the condition (financial or
other), business, properties, net assets or results of
operations of the Fund.
(n) The Fund has not distributed and, prior to the
later to occur of (i) the Closing Date and (ii)
completion of the distribution of the Shares, will not
distribute to the public any offering material in
connection with the offering and sale of the Shares
other than the Registration Statement, the Prepricing
Prospectus included in Pre-Effective Amendment No. 1 to
the Registration Statement, the Prospectus and the
advertisements/sales literature filed with the NASD on
December 5, 2001.
(o) The Fund has such licenses, permits, and
authorizations of governmental or regulatory authorities
("permits") as are necessary to own its property and to
conduct its business in the manner described in the
Prospectus (and any amendment or supplement thereto);
the Fund has fulfilled and performed all its material
obligations with respect to such permits and no event
has occurred which allows or, after notice or lapse of
time, would allow, revocation or termination thereof or
results in any other material impairment of the rights
of the Fund under any such permit, subject in each case
to such qualification as may be set forth in the
Prospectus (and any amendment or supplement thereto);
15
and, except as described in the Prospectus (and any
amendment or supplement thereto), none of such permits
contains any restriction that is materially burdensome
to the Fund.
(p) The Fund maintains and will maintain a system
of internal accounting controls sufficient to provide
reasonable assurances that (i) transactions are executed
in accordance with management's general or specific
authorization and with the investment policies and
restrictions of the Fund and the applicable requirements
of the 1940 Act, the 1940 Act Rules and Regulations and
the Internal Revenue Code of 1986, as amended (the
"Code"); (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity
with generally accepted accounting principles, to
calculate net asset value, to maintain accountability
for assets and to maintain material compliance with the
books and records requirements under the 1940 Act and
the 1940 Act Rules and Regulations; (iii) access to
assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded
account for assets is compared with existing assets at
reasonable intervals and appropriate action is taken
with respect to any differences.
(q) The conduct by the Fund of its business (as
described in the Prospectus) does not require it to be
the owner, possessor or licensee of any patents, patent
licenses, trademarks, service marks or trade names which
it does not own, possess or license.
(r) Except as stated in this Agreement and in the
Prospectus (and any amendment or supplement thereto),
the Fund has not taken and will not take, directly or
indirectly, any action designed to or which should
reasonably be expected to cause or result in or which
will constitute stabilization or manipulation of the
price of the Common Shares in violation of federal
securities laws and the Fund is not aware of any such
action taken or to be taken by any affiliates of the
Fund.
(s) The Fund is duly registered under the 1940 Act
as a closed-end, non-diversified management investment
company and the 1940 Act Notification has been duly
filed with the Commission and, at the time of filing
thereof and at the time of filing any amendment or
supplement thereto, conformed in all material respects
with all applicable provisions of the 1940 Act and the
Rules and Regulations. The Fund has not received any
16
notice from the Commission pursuant to Section 8(e) of
the 1940 Act with respect to the 1940 Act Notification
or the Registration Statement (or any amendment or
supplement to either of them).
(t) All advertising, sales literature or other
promotional material (including "prospectus wrappers"
and "broker kits"), whether in printed or electronic
form, authorized in writing by or prepared by the Fund
or the Manager for use in connection with the offering
and sale of the Shares (collectively, "sales material")
complied and comply in all material respects with the
applicable requirements of the 1933 Act, the 1933 Act
Rules and Regulations and the rules and interpretations
of the NASD and if required to be filed with the NASD
under the NASD's conduct rules were so filed. No sales
material, when read together with the Prospectus,
contained or contains an untrue statement of a material
fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the
statements therein, in light of the circumstances under
which they were made, not misleading.
(u) This Agreement and each of the Fund Agreements
complies in all material respects with all applicable
provisions of the 1940 Act, the 1940 Act Rules and
Regulations, the Investment Advisers Act of 1940, as
amended (the "Advisers Act") and the rules and
regulations adopted by the Commission under the Advisers
Act (the "Advisers Act Rules and Regulations").
(v) No holder of any security of the Fund has any
right to require registration of Common Shares or any
other security of the Fund because of the filing of the
registration statement or consummation of the
transactions contemplated by this Agreement.
(w) The Shares have been duly approved for listing
upon notice of issuance on the NYSE and the Fund's
registration statement on Form 8-A, under the 1934 Act,
has become effective.
(x) 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 Code.
7. Representations and Warranties of the Manager. The
Manager represents and warrants to each Underwriter as follows:
17
(a) The Manager has been duly formed and is
validly existing and in good standing under the laws of
Delaware, with power and authority (partnership and
other) to own its properties and conduct its business as
described in the Prospectus, and has been duly qualified
as a foreign partnership for the transaction of business
and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such
qualification, other than where the failure to be so
qualified or in good standing would not have a material
adverse effect on the Manager and its subsidiaries taken
as a whole.
(b) The Manager is duly registered as an
investment adviser under the Advisers Act and is not
prohibited by any provision of the Advisers Act or the
1940 Act, or the rules and regulations under such Acts,
from acting as an investment adviser for the Company as
contemplated in the Prospectus and the Management
Agreement. There does not exist to the knowledge of the
Manager any proceeding, which might materially adversely
affect the registration of the Manager with the
Commission.
(c) Each of this Agreement, the Management
Agreement and any other Fund Agreement to which the
Manager is a party has been duly authorized, executed
and delivered by the Manager and complies with all
applicable provisions of the Advisers Act, the 1940 Act,
and the rules and regulations under such Acts.
(d) Neither the execution, delivery or performance
by the Manager of its obligations under this Agreement,
the Management Agreement or any other Fund Agreement to
which the Manager is a party nor the consummation of the
transactions contemplated therein or in the Registration
Statement or Prospectus nor the fulfillment of the terms
thereof will conflict with or result in a breach of any
of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the
Manager is a party or by which the Manager is bound or
to which any of the property or assets of the Manager is
subject, nor will any such action result in any
violation of the provisions of the organizational
documents of the Manager or any applicable law or
statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the
Manager or any of its properties.
18
(e) Other than as set forth in (i) Part II, Item 1
of the Quarterly Report on Form 10-Q filed by the
Manager with the Commission with respect to the
quarterly periods ended March 31, 2001, June 30, 2001
and September 30, 2001 pursuant to Section 13 or 15(d)
of the 1934 Act and (ii) the Current Report on Form 8-K
filed by the Manager with the Commission on December 13,
2001 and January 10, 2002 pursuant to Section 13 or
15(d) of the 1934 Act, there are no legal or
governmental investigations, actions, suits or
proceedings pending or, to the knowledge of the Manager,
threatened against or affecting the Manager or any of
its subsidiaries or any of their respective properties
or to which the Manager or any of its subsidiaries is or
may be a party or to which any property of the Manager
or any of its subsidiaries is or may be the subject
which, if determined adversely to the Manager or any of
its subsidiaries, would individually or in the aggregate
have, or reasonably be expected to have, a material
adverse effect on the Manager's ability to perform its
obligations under the Management Agreement and, to the
Manager's knowledge, no such proceedings are threatened
or contemplated by governmental authorities or
threatened by others.
(f) No consent, approval, authorization, order,
license, registration or qualification of, or any filing
with, any court or governmental agency or body, whether
foreign or domestic, is required for the consummation by
the Manager of the transactions contemplated by this
Agreement.
(g) The Manager owns or possesses all material
governmental licenses, permits, consents, orders,
approvals or other authorizations, whether foreign or
domestic, to enable the Manager to perform its
obligations under the Management Agreement.
(h) The information regarding the Manager in the
Registration Statement and the Prospectus complies in
all material respects with the requirements of Form N-2
and, as of the date of the Prospectus, such information
regarding the Manager did 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, in light of the
circumstances under which they were made, not
misleading.
(i) Except as stated in this Agreement and in the
Prospectus (and in any amendment or supplement thereto),
19
the Manager has not taken and will not take, directly or
indirectly, any action designed to or which should
reasonably be expected to cause or result in or which
will constitute, stabilization or manipulation of the
price of the Common Shares in violation of federal
securities laws and the Manager is not aware of any such
action taken or to be taken by any affiliates of the
Manager.
(j) In the event that the Fund or the Manager
makes available any promotional materials intended for
use only by qualified broker-dealers and registered
representatives thereof by means of an Internet web site
or similar electronic means, the Manager will install
and maintain pre-qualification and password-protection
or similar procedures which are reasonably designed to
effectively prohibit access to such promotional
materials by persons other than qualified broker-dealers
and registered representatives thereof.
8. Indemnification and Contribution.
(a) The Fund and the Manager, jointly and
severally, agree to indemnify and hold harmless each of
you and each other Underwriter and each person, if any,
who controls any Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934
Act, from and against any and all losses, claims,
damages, liabilities and expenses, joint or several
(including reasonable costs of investigation) arising
out of or based upon any untrue statement or alleged
untrue statement of a material fact contained in the
Registration Statement, the Prospectus, any Prepricing
Prospectus, any sales material (or any amendment or
supplement to any of the foregoing) or arising out of or
based upon any omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein (in the case of
a prospectus, in light of the circumstances under which
they were made) not misleading, except insofar as such
losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or
omission or alleged untrue statement or omission which
has been made therein or omitted therefrom in reliance
upon and in conformity with the information relating to
such Underwriters furnished in writing to the Fund by or
on behalf of any Underwriter through you expressly for
use in connection therewith; provided, however, that the
foregoing indemnity with respect to the Registration
Statement, the Prospectus or any Prepricing Prospectuses
(or any amendment or supplement to any of the foregoing)
20
shall not inure to the benefit of any Underwriter from
whom the person asserting any loss, claim, damage,
liability or expense purchased Shares, if it is shown
that a copy of the Prospectus, as then amended or
supplemented, which would have cured any defect giving
rise to such loss, claim, damage, liability or expense
was not sent or delivered to such person by or on behalf
of such Underwriter, if required by law to be so
delivered, at or prior to the confirmation of the sale
of such Shares to such person and such Prospectus,
amendments and supplements had been provided by the Fund
to the Underwriters in the requisite quantity and on a
timely basis to permit proper delivery. The foregoing
indemnity agreement shall be in addition to any
liability which the Fund or the Manager may otherwise
have.
(b) If any action, suit or proceeding shall be
brought against any Underwriter or any person
controlling any Underwriter in respect of which
indemnity may be sought against the Fund or the Manager,
such Underwriter or such controlling person shall
promptly notify the Fund or the Manager and the Fund or
the Manager shall assume the defense thereof, including
the employment of counsel and the payment of all fees
and expenses. Such Underwriter or any such controlling
person shall have the right to employ separate counsel
in any such action, suit or proceeding and to
participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such
Underwriter or controlling person unless (i) the Fund or
the Manager have agreed in writing to pay such fees and
expenses, (ii) the Fund and the Manager have failed
within a reasonable time to assume the defense and
employ counsel or (iii) the named parties to any such
action, suit or proceeding (including any impleaded
parties) include both such Underwriter or such
controlling person and the Fund or the Manager and such
Underwriter or such controlling person shall have been
advised by its counsel that representation of such
indemnified party and the Fund or the Manager by the
same counsel would be inappropriate under applicable
standards of professional conduct (whether or not such
representation by the same counsel has been proposed)
due to actual or potential differing interests between
them (in which case the Fund and the Manager shall not
have the right to assume the defense of such action,
suit or proceeding on behalf of such Underwriter or such
controlling person). It is understood, however, that
the Fund and the Manager shall, in connection with any
one such action, suit or proceeding or separate but
21
substantially similar or related actions, suits or
proceedings in the same jurisdiction arising out of the
same general allegations or circumstances be liable for
the reasonable fees and expenses of only one separate
firm of attorneys (in addition to any local counsel if
there is any action, suit or proceeding in more than one
jurisdiction) at any time for all such Underwriters and
controlling persons not having actual or potential
differing interests with you or among themselves, which
firm shall be designated in writing by ▇▇▇▇▇▇▇ ▇▇▇▇▇
Barney Inc. and that, subject to the requirements of
1940 Act Release No. 11330, all such fees and expenses
shall be reimbursed promptly as they are incurred. The
Fund and the Manager shall not be liable for any
settlement of any such action, suit or proceeding
effected without the written consent of the Fund or the
Manager, but if settled with such written consent or if
there be a final judgment for the plaintiff in any such
action, suit or proceeding, the Fund and the Manager
agree to indemnify and hold harmless any Underwriter, to
the extent provided in the preceding paragraph, and any
such controlling person from and against any loss,
liability, damage or expense by reason by such
settlement or judgment.
(c) Each Underwriter agrees, severally and not
jointly, to indemnify and hold harmless the Fund and the
Manager, their trustees, directors, any officers of the
Fund who sign the Registration Statement and any person
who controls the Fund or the Manager within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934
Act, to the same extent as the foregoing indemnity from
the Fund and the Manager to each Underwriter, but only
with respect to information relating to such Underwriter
furnished in writing by or on behalf of such Underwriter
through you expressly for use in the Registration
Statement or the Prospectus (or any amendment or
supplement to either of them). If any action, suit or
proceeding shall be brought against the Fund or the
Manager, any of their trustees, directors, any such
officer or any such controlling person, based on the
Registration Statement or the Prospectus (or any
amendment or supplement to either of them) and in
respect of which indemnity may be sought against any
Underwriter pursuant to this paragraph (c), such
Underwriter shall have the rights and duties given to
the Fund by paragraph (b) above (except that if the Fund
or the Manager shall have assumed the defense thereof
such Underwriter shall not be required to do so, but may
employ separate counsel therein and participate in the
defense thereof, but the fees and expenses of such
22
counsel shall be at such Underwriter's expense) and the
Fund and the Manager, their trustees, directors, any
such officer and any such controlling person shall have
the rights and duties given to the Underwriters by
paragraph (b) above. The foregoing indemnity agreement
shall be in addition to any liability which the
Underwriters may otherwise have.
(d) If the indemnification provided for in this
Section 8 is unavailable to an indemnified party under
paragraphs (a) or (c) hereof in respect of any losses,
claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to
the amount paid or payable by such indemnified party as
a result of such losses, claims, damages, liabilities or
expenses (i) in such proportion as is appropriate to
reflect the relative benefits received by the Fund and
the Manager on the one hand (treated jointly for this
purpose as one person) and the Underwriters on the other
hand from the offering of the Shares or (ii) if the
allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Fund
and the Manager on the one hand (treated jointly for
this purpose as one person) and of the Underwriters on
the other hand in connection with the statements or
omissions which resulted in such losses, claims,
damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative
benefits received by the Fund and the Manager on the one
hand (treated jointly for this purpose as one person)
and the Underwriters on the other hand shall be deemed
to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received
by the Fund as set forth in the table on the cover page
of the Prospectus bear to the total payments received by
the Underwriters with respect to the Firm Shares as set
forth in the table on the cover page of the Prospectus.
The relative fault of the Fund and the Manager on the
one hand (treated jointly for this purpose as one
person) and of the Underwriters on the other hand shall
be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to
state a material fact relates to information supplied by
the Fund and the Manager on the one hand (treated
jointly for this purpose as one person) or by the
Underwriters on the other hand and the parties' relative
23
intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
(e) The Fund, the Manager and the Underwriters
agree that it would not be just and equitable if
contribution pursuant to this Section 8 were determined
by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other
method of allocation that does not take account of the
equitable considerations referred to in paragraph (d)
above. The amount paid or payable by an indemnified
party as a result of the losses, claims, damages,
liabilities and expenses referred to in paragraph (d)
above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in
connection with defending any such action, suit or
proceeding. Notwithstanding the provisions of this
Section 8, no Underwriter shall be required to
contribute any amount in excess of the amount by which
the total price of the Shares underwritten by it and
distributed to the public exceeds the amount of any
damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be
entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this
Section 8 are several in proportion to the respective
number of Firm Shares set forth opposite their names in
Schedule I (or such numbers of Firm Shares increased as
set forth in Section 10 hereof) and not joint.
(f) No indemnifying party shall, without the prior
written consent of the indemnified party, effect any
settlement of any pending or threatened action, suit or
proceeding in respect of which any indemnified party is
or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such
indemnified party from all liability from claimants on
claims that are the subject matter of such action, suit
or proceeding.
(g) Any losses, claims, damages, liabilities or
expenses for which an indemnified party is entitled to
indemnification or contribution under this Section 8
shall be paid by the indemnifying party to the
indemnified party as such losses, claims, damages,
24
liabilities or expenses are incurred. The indemnity and
contribution agreements contained in this Section 8 and
the representations and warranties of the Fund and the
Manager set forth in this Agreement shall remain
operative and in full force and effect, regardless of
(i) any investigation made by or on behalf of any
Underwriter or any person controlling any Underwriter,
the Fund, the Manager or their trustees, directors or
officers or any person controlling the Fund or the
Manager, (ii) acceptance of any Shares and payment
therefor hereunder and (iii) any termination of this
Agreement. A successor to any Underwriter or to the
Fund, the Manager or their trustees, directors or
officers or any person controlling any Underwriter, the
Fund or the Manager shall be entitled to the benefits of
the indemnity, contribution and reimbursement agreements
contained in this Section 8.
9. Conditions of Underwriters' Obligations. The
several obligations of the Underwriters to purchase any Shares
hereunder are subject to, in the good faith judgment of the
Underwriters, the accuracy of and compliance with the
representations, warranties and agreements of and by the Fund and
the Manager contained herein on and as of the date hereof, the
date on which the Registration Statement becomes or became
effective, the date of the Prospectus (and of any amendment or
supplement thereto), the Closing Date and, with respect to any
Additional Shares, any Option Closing Date; to the accuracy and
completeness of all statements made by the Fund, the Manager or
any of their officers in any certificate delivered to the
Representatives or their counsel pursuant to this Agreement and
to the following conditions:
(a) If, at the time this Agreement is executed and
delivered, it is necessary for the Registration
Statement or a post-effective amendment thereto to be
declared effective before the offering of the Shares may
commence, the Registration Statement or such
post-effective amendment shall have become effective not
later than 5:30 p.m., New York City time, on the date
hereof or at such later date and time as shall be
consented to in writing by you and all filings, if any,
required by Rules 497 and 430A under the 1933 Act Rules
and Regulations shall have been timely made; no order
suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for
that purpose shall have been instituted or, to the
knowledge of the Fund, the Manager or any Underwriter,
threatened by the Commission and any request of the
Commission for additional information (to be included in
the Registration Statement or the Prospectus or
25
otherwise) shall have been complied with to your
satisfaction.
(b) You shall have received on the Closing Date an
opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, counsel for the Fund,
dated the Closing Date and addressed to you, as
Representatives of the several Underwriters, to the
effect that:
(i) The Fund has been duly incorporated and
is validly existing as a corporation in good
standing under the laws of the State of Maryland
with full corporate power and authority to own,
lease and operate its properties and to conduct its
business as described in the Registration Statement
and the Prospectus (and any amendment or supplement
thereto through the date of the opinion) and is
duly registered and qualified to conduct its
business and is in good standing in each
jurisdiction where the nature of its properties or
the conduct of its business requires such
registration or qualification, except where the
failure so to register or to qualify does not have
a material, adverse effect on the condition
(financial or other), business, properties, net
assets or results of operations of the Fund;
(ii) The authorized and outstanding capital
stock of the Fund is as set forth in the
Registration Statement and Prospectus (or any
amendment or supplement thereto through the date of
the opinion); and the description of the authorized
capital stock of the Fund contained in the
Prospectus (or any amendment or supplement thereto
through the date of the opinion) under the caption
"Description of Shares" conforms in all material
respects as to legal matters to the terms thereof
contained in the Fund's Articles of Incorporation;
(iii) All the shares of capital stock of the
Fund outstanding prior to the issuance of the
Shares have been duly authorized and validly issued
and are fully paid and nonassessable;
(iv) The Shares have been duly authorized and,
when issued and delivered to the Underwriters
against payment therefor in accordance with the
terms hereof, will be validly issued, fully paid
and nonassessable and not subject to any preemptive
rights that entitle or will entitle any person to
26
acquire any Shares upon the issuance thereof by the
Fund;
(v) The form of certificates for the Shares
is in due and proper form and complies with the
requirements of all applicable laws and the NYSE;
(vi) The Fund has the power and authority to
enter into this Agreement and the Fund Agreements
and to issue, sell and deliver the Shares to the
Underwriters as provided herein and this Agreement
and each of the Fund Agreements have been duly
authorized, executed and delivered by the Fund and
assuming due authorization, execution and delivery
by the other parties thereto, constitute the valid,
legal and binding agreements of the Fund,
enforceable against the Fund in accordance with
their terms, except as enforcement of rights to
indemnity hereunder may be limited by Federal or
state securities laws or principles of public
policy and subject to the qualification that the
enforceability of the Fund's obligations hereunder
and thereunder may be limited by bankruptcy,
insolvency, reorganization, moratorium and other
laws relating to or affecting creditors' rights
generally and by general equitable principles,
whether enforcement is considered in a proceeding
in equity or at law;
(vii) The Manager has corporate power and
authority to enter into this Agreement and the
Management Agreement and each of this Agreement and
the Management Agreement has been duly authorized,
executed and delivered by the Manager and each of
this Agreement and the Management Agreement is a
valid, legal and binding agreement of the Manager,
enforceable against the Manager in accordance with
its terms, except as enforcement of rights to
indemnity and contribution hereunder may be limited
by Federal or state securities laws or principles
of public policy and subject to the qualification
that the enforceability of the Manager's
obligations hereunder and thereunder may be limited
by bankruptcy, insolvency, reorganization,
moratorium and other laws relating to or affecting
creditors' rights generally and by general
equitable principles, whether enforcement is
considered in a proceeding in equity or at law;
(viii) The Fund Agreements comply in all
material respects with all applicable provisions of
27
the 1933 Act, the 1940 Act, the Advisers Act, the
Rules and Regulations and the Advisers Act Rules
and Regulations;
(ix) The Fund is not in violation of its
Articles of Incorporation or By-Laws or to the best
knowledge of such counsel after reasonable inquiry,
is not in default in the performance of any
material obligation, agreement or condition
contained in any bond, debenture, note or other
evidence of indebtedness, except as may be
disclosed in the Prospectus (and any amendment or
supplement thereto);
(x) No consent, approval, authorization or
order of or registration or filing with the
Commission, the NASD, any state securities
commission, any national securities exchange, any
arbitrator, any court or any other governmental
body, agency or regulatory, self-regulatory or
administrative agency or any official is required
on the part of the Fund (except as have been
obtained under the 1933 Act and the 1934 Act or
such as may be required under state securities or
Blue Sky laws governing the purchase and
distribution of the Shares) for the valid issuance
and sale of the Shares to the Underwriters as
contemplated by this Agreement, performance of the
Fund Agreements or this Agreement by the Fund, the
consummation by the Fund of the transactions
contemplated thereby or hereby or the adoption of
the Fund's Dividend Reinvestment Plan;
(xi) Neither the offer, sale or delivery of
the Shares, the execution, delivery or performance
of this Agreement or the Fund Agreements,
compliance by the Fund with the provisions hereof
or thereof, consummation by the Fund of the
transactions contemplated hereby or thereby nor the
adoption of the Fund's Dividend Reinvestment Plan
violates the Articles of Incorporation or By-Laws
of the Fund or any material agreement, indenture,
lease or other instrument to which the Fund is a
party or by which it or any of its properties is
bound that is an exhibit to the Registration
Statement or that is known to such counsel after
reasonable inquiry or, to the best of such
counsel's knowledge after reasonable inquiry, will
result in the creation or imposition of any
material lien, charge or encumbrance upon any
property or assets of the Fund, nor, to the best of
28
such counsel's knowledge after reasonable inquiry,
will any such action result in any violation of any
existing material law, regulation, ruling (assuming
compliance with all applicable state securities and
Blue Sky laws), judgment, injunction, order or
decree applicable to the Fund or any of its
properties;
(xii) The Registration Statement and all
post-effective amendments, if any, have become
effective under the 1933 Act and, to the best
knowledge of such counsel after reasonable inquiry,
no order suspending the effectiveness of the
Registration Statement has been issued and no
proceedings for that purpose are pending before or
contemplated by the Commission; and any filing of
the Prospectus and any amendments or supplements
thereto required pursuant to Rule 497 of the 1933
Act Rules and Regulations prior to the date of such
opinion have been made in accordance with Rule 497;
(xiii) The Fund is duly registered with the
Commission under the 1940 Act as a closed-end, non-
diversified management investment company and all
action has been taken by the Fund as required by
the 1933 Act and the 1940 Act and the Rules and
Regulations in connection with the issuance and
sale of the Shares to make the public offering and
consummate the sale of the Shares as contemplated
by this Agreement;
(xiv) The statements made in the Registration
Statement and the Prospectus (and any amendment or
supplement to either of them through the date of
the opinion) under the caption "Tax Matters" have
been reviewed by such counsel and to the extent
they describe or summarize tax laws, doctrines or
practices of the United States, present a fair and
accurate description or summary thereof as of the
date of the opinion;
(xv) The statements in the Registration
Statement and Prospectus (and any amendment or
supplement to either of them through the date of
the opinion), insofar as they are descriptions of
contracts, agreements or other legal documents or
refer to statements of law or legal conclusions,
are accurate and present fairly the information
required to be shown;
29
(xvi) The Registration Statement and the
Prospectus (and any amendment or supplement to
either of them through the date of the opinion)
comply as to form in all material respects with the
requirements of the 1933 Act, the 1940 Act and the
Rules and Regulations (except that no opinion need
be expressed as to the financial statements and the
notes thereto and the schedules and other financial
and statistical data included therein as to which
such counsel need not express any opinion);
(xvii) To the best knowledge of such counsel
after reasonable inquiry, (A) other than as
described or contemplated in the Prospectus (or any
amendment or supplement thereto through the date of
the opinion), there are no actions, suits or other
legal or governmental proceedings pending or
expressly threatened against the Fund and (B) there
are no material agreements, contracts, indentures,
leases or other instruments that are required to be
described in the Registration Statement or the
Prospectus (or any amendment or supplement to
either of them through the date of the opinion) or
to be filed as an exhibit to the Registration
Statement that are not described or filed as
required, as the case may be;
(xviii) To the best knowledge of such counsel
after reasonable inquiry, the Fund is not in
violation of any law, ordinance, administrative or
governmental rule or regulation applicable to the
Fund or of any decree of the Commission, the NASD,
any state securities commission, any national
securities exchange, any arbitrator, any court or
any other governmental, regulatory, self-regulatory
or administrative agency or any official having
jurisdiction over the Fund; and
(xix) The Shares are duly authorized for
listing, subject to official notice of issuance, on
the NYSE and the Fund's registration statement on
Form 8-A under the 1934 Act is effective.
Such counsel shall also state that although counsel
has not undertaken, except as otherwise indicated in
their opinion, to determine independently and does not
assume any responsibility for, the accuracy or
completeness of the statements in the Registration
Statement, such counsel has participated in the
preparation of the Registration Statement and the
Prospectus, including review and discussion of the
30
contents thereof, and nothing has come to the attention
of such counsel that has caused it to believe that the
Registration Statement, at the time the Registration
Statement became effective or the Prospectus, as of its
date and as of the Closing Date or the Option Closing
Date, as the case may be, contained an untrue statement
of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the
statements therein (in the case of a prospectus, in
light of the circumstances under which they were made)
not misleading or that any amendment or supplement to
the Prospectus, as of the Closing Date or the Option
Closing Date, contained an untrue statement of a
material fact or omitted to state a material fact
necessary in order to make the statements therein, in
light of the circumstances under which they were made,
not misleading (it being understood that such counsel
need express no view with respect to the financial
statements and the notes thereto and the schedules and
other financial and statistical data included in the
Registration Statement or the Prospectus).
In rendering such opinion, such counsel may limit
such opinion to matters involving the application of the
laws of the State of New York, the State of Maryland,
the State of Delaware and the United States. To the
extent they deem proper and to the extent specified in
such opinion, such counsel may rely, as to matters
involving the application of laws of the State of
Maryland, upon the opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ &
Ingersoll LLP and, [as to matters involving the
application of laws of the State of [California], upon
the opinion of ___________________ or, in either case,
other counsel of good standing whom they believe to be
reliable and who are satisfactory to the
Representatives; provided that (X) such reliance is
expressly authorized by the opinion so relied upon and a
copy of each such opinion is delivered to the
Representatives and is, in form and substance,
satisfactory to them and their counsel and (Y) ▇▇▇▇▇▇ &
▇▇▇▇▇▇ LLP states in their opinion that they believe
that they and the Underwriters are justified in relying
thereon.]
(c) You shall have received on the Closing Date an
opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., Senior Vice President
and General Counsel of Alliance Capital Management
Corporation, the general partner of the Manager, dated
the Closing Date and addressed to you, as
Representatives of the several Underwriters, to the
effect that:
31
(i) The Manager has been duly formed and is
validly existing and in good standing under the
laws of Delaware, with power and authority
(partnership and other) to own its properties and
conduct its business as described in the
Prospectus;
(ii) The Manager has been duly qualified as a
foreign partnership for the transaction of business
and is in good standing under the laws of each
other jurisdiction in which it owns or leases
properties, or conducts any business, so as to
require such qualification, other than where the
failure to be so qualified or in good standing
would not have a material adverse effect on the
Manager and its subsidiaries taken as a whole;
(iii) The Manager is duly registered as an
investment adviser under the Advisers Act and is
not prohibited by the Advisers Act, the 1940 Act,
or the rules and regulations under such Acts, from
acting as an investment adviser for the Company as
contemplated in the Prospectus and the Management
Agreement;
(iv) Neither the performance by the Manager of
its obligations under this Agreement nor the
consummation of the transactions contemplated
therein or in the Registration Statement nor the
fulfillment of the terms thereof is, or with the
giving of notice or lapse of time or both would be,
in violation of or constitute a default under, the
limited partnership agreement of the Manager or any
agreement known to such counsel to which the
Manager is a party or by which it or any of its
properties is bound, except for violations and
defaults which individually and in the aggregate
are not material to the Manager and its
subsidiaries taken as a whole; or, to the knowledge
of such counsel, the terms and provisions of any
applicable order, law, rule or regulation of any
court or governmental agency or body under the laws
of Delaware, federal law or the laws of any other
jurisdiction in the United States having
jurisdiction over the Manager or any of its
properties;
(v) Other than as set forth in (i) Part II,
Item 1 of the Quarterly Report on Form 10-Q filed
by the Manager with the Commission with respect to
the quarterly periods ended March 31, 2001,
32
June 30, 2001 and September 30, 2001 pursuant to
Section 13 or 15(d) of the 1934 Act and (ii) the
Current Report on Form 8-K filed by the Manager
with the Commission on December 13, 2001 and
January 10, 2002 pursuant to Section 13 or 15(d) of
the 1934 Act, to the knowledge of such counsel,
there is no pending or threatened action, suit or
proceeding to which the Manager is a party before
or by any court or governmental agency, authority
or body or any arbitrator, whether foreign or
domestic, which reasonably might result in a
material adverse effect on the Manager's
ability to perform its obligations under the
Management Agreement.
In rendering such opinion, such counsel may limit
such opinion to matters involving the application of the
laws of the State of New York, the State of Delaware and
the United States.
(d) (i) You shall have received on the Closing
Date an opinion of _________, special [California] [New
York] counsel to the Fund, dated the Closing Date and
addressed to you, as Representatives of the several
Underwriters, to the effect that:
The statements contained in the
Prospectus under the headings "Prospectus Summary -
Special Risk Considerations - Concentration Risk",
"Risks - Concentration Risk" and "Tax Matters -
[California] [New York] Tax Matters" and in
Appendix C to the statement of additional
information under the heading "Factors Pertaining
to [California] [New York]", to the extent that
such statements constitute matters of law or legal
conclusions, provide a fair and accurate summary of
such law or conclusions. Such statements are based
on current law and special counsel's understanding
of the Fund's proposed operations, as disclosed in
the Prospectus.
Such counsel shall also state that although special
counsel does not pass upon or assume any responsibility
for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or
the Prospectus (other than to the extent set forth
above), and has not made any independent check or
verification thereof, no facts have come to the
attention of such special counsel which would lead it to
believe that the material contained in the Registration
Statement, at the time it became effective, and the
33
Prospectus, as of its date and as of the Closing Date or
the Option Closing Date, as the case may be, under the
headings "Prospectus Summary - Special Risk
Considerations - Concentration Risk", "Risks -
Concentration Risk" and "Tax Matters - [California] [New
York] Tax Matters" and in Appendix C to the statement of
additional information under the heading "Factors
Pertaining to [California] [New York]", 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 (in the case of
a prospectus, in light of the circumstances under which
they were made) not misleading or that any statement
contained in any amendment or supplement to the
Prospectus under such headings, as of the Closing Date
or the Option Closing Date, as the case may be,
contained any untrue statement of a material fact or
omitted or omits to state a material fact necessary in
order to make the statements therein, in light of the
circumstances under which they were made, not
misleading.
In rendering such opinion, such special counsel may rely
as to matters of fact, to the extent such special
counsel deems proper, on certificates of responsible
officers of the Fund and of the Manager, and of public
officials.
[(ii) You shall have received on the Closing
Date a letter, substantially in the form heretofore
approved by you, from __________, special counsel to the
Fund, dated the Closing Date and addressed to you, as
Representatives of the several Underwriters, with
respect to the taxable equivalent yield tables under the
heading "Performance Related and Comparative
Information" in the statement of additional
information.]
(e) That you shall have received on the Closing
Date, an opinion, dated the Closing Date, of ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Underwriters, dated
the Closing Date and addressed to you, as
Representatives of the several Underwriters, with
respect to such matters as the Underwriters may require
and the Fund, the Manager and their respective counsels
shall have furnished to such counsel such documents as
they may request for the purpose of enabling them to
pass upon such matters.
(f) That you shall have received letters addressed
to you, as Representatives of the several Underwriters,
34
and dated the date hereof and the Closing Date from
Ernst & Young LLP, independent certified public
accountants, substantially in the forms heretofore
approved by you.
(g) (i) No order suspending the effectiveness of
the Registration Statement or prohibiting or suspending
the use of the Prospectus (or any amendment or
supplement thereto) or any Prepricing Prospectus or any
sales material shall have been issued and no proceedings
for such purpose or for the purpose of commencing an
enforcement action against the Fund, the Manager or,
with respect to the transactions contemplated by the
Prospectus (or any amendment or supplement thereto) and
this Agreement, any Underwriter, may be pending before
or, to the knowledge of the Fund, the Manager or any
Underwriter or in the reasonable view of counsel to the
Underwriters, shall be threatened or contemplated by the
Commission at or prior to the Closing Date and that any
request for additional information on the part of the
Commission (to be included in the Registration
Statement, the Prospectus or otherwise) be complied with
to the satisfaction of the Representatives, (ii) there
shall not have been any change in the capital stock of
the Fund nor any material increase in debt of the Fund
from that set forth in the Prospectus (and any amendment
or supplement thereto) and the Fund shall not have
sustained any material liabilities or obligations,
direct or contingent, other than those reflected in the
Prospectus (and any amendment or supplement thereto);
(iii) since the date of the Prospectus there shall not
have been any material, adverse change in the condition
(financial or other), business, prospects, properties,
net assets or results of operations of the Fund or the
Manager; (iv) the Fund and the Manager must not have
sustained any material loss or interference with its
business from any court or from legislative or other
governmental action, order or decree or from any other
occurrence not described in the Registration Statement
and the Prospectus (and any amendment or supplement to
either of them); and (v) all of the representations and
warranties of the Fund and the Manager contained in this
Agreement shall be true and correct on and as of the
date hereof and as of the Closing Date as if made on and
as of the Closing Date.
(h) Subsequent to the effective date of this
Agreement, there shall not have occurred (i) any change
or any development involving a prospective change in or
affecting the condition (financial or other), business,
prospects, properties, net assets or results of
35
operations of the Fund or the Manager not contemplated
by the Prospectus (and any amendment or supplement
thereto), which in your opinion, as Representatives of
the several Underwriters, would materially, adversely
affect the market for the Shares or (ii)any event or
development relating to or involving the Fund, the
Manager or any officer or trustee or director of the
Fund or the Manager which makes any statement of a
material fact made in the Prospectus (or any amendment
or supplement thereto) untrue or which, in the opinion
of the Fund and its counsel or the Underwriters and
their counsel, requires the making of any addition to or
change in the Prospectus (or any amendment or supplement
thereto) in order to state a material fact required by
the 1933 Act, the 1940 Act, the Rules and Regulations or
any other law to be stated therein or necessary in order
to make the statements therein (in the case of a
prospectus, in light of the circumstances under which
they were made) not misleading, if amending or
supplementing the Prospectus (or any amendment or
supplement thereto) to reflect such event or development
would, in your opinion, as Representatives of the
several Underwriters, materially, adversely affect the
market for the Shares.
(i) That neither the Fund nor the Manager shall
have failed at or prior to the Closing Date to have
performed or complied with any of the agreements herein
contained and required to be performed or complied with
by them at or prior to the Closing Date.
(j) That you shall have received on the Closing
Date a certificate, dated such date, of the president or
any vice president and of the controller or treasurer of
each of the Fund and the Manager certifying that
(i) the signers have carefully examined the
Registration Statement, the Prospectus (and any
amendments or supplements to either of them) and this
Agreement, (ii) the representations and warranties of
the Fund (with respect to the certificates from such
Fund officers) and the representations of the Manager
(with respect to the certificates from such officers of
the Manager) in this Agreement are true and correct on
and as of the date of the certificate as if made on such
date, (iii) since the date of the Prospectus (and any
amendment or supplement thereto) there has not been any
material, adverse change in the condition (financial or
other), business, prospects (other than as a result of a
change in the financial markets generally), properties,
net assets or results of operations of the Fund (with
respect to the certificates from such Fund officers) or
36
the Manager (with respect to the certificates from such
officers of the Manager), (iv) to the knowledge of such
officers after reasonable investigation, no order
suspending the effectiveness of the Registration
Statement or prohibiting the sale of any of the Shares
or having a material, adverse effect on the Fund (with
respect to the certificates from such Fund officers) or
the Manager (with respect to the certificates from such
officers of the Manager) has been issued and no
proceedings for any such purpose are pending before or
threatened by the Commission or any court or other
regulatory body, the NASD, any state securities
commission, any national securities exchange, any
arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or
any official, (v) each of the Fund (with respect to
certificates from such Fund officers) and the Manager
(with respect to certificates from such officers of the
Manager) has performed and complied with all agreements
that this Agreement require it to perform by such
Closing Date, (vi) neither the Fund (with respect to
the certificate from such officers of the Fund) nor the
Manager (with respect to the certificate from such
officers of the Manager) has sustained any material loss
or interference with its business from any court or from
legislative or other governmental action, order or
decree or from any other occurrence not described in the
Registration Statement and the Prospectus and any
amendment or supplement to either of them and
(vii) with respect to the certificate from such
officers of the Fund, there has not been any change in
the capital stock of the Fund nor any material increase
in the debt of the Fund from that set forth in the
Prospectus (and any amendment or supplement thereto) and
the Fund has not sustained any material liabilities or
obligations, direct or contingent, other than those
reflected in the Prospectus (and any amendment or
supplement thereto).
(k) That the Fund and the Manager shall have
furnished to you such further certificates, documents
and opinions of counsel as you shall reasonably request
(including certificates of officers of the Fund and the
Manager).
All such opinions, certificates, letters and other
documents will be in compliance with the provisions
hereof only if they are satisfactory in form and
substance to you and your counsel acting in good faith.
37
Any certificate or document signed by any officer
of the Fund or the Manager and delivered to you, as
Representatives of the Underwriters or to Underwriters'
counsel, shall be deemed a representation and warranty
by the Fund or the Manager to each Underwriter as to the
statements made therein.
The several obligations of the Underwriters to
purchase Additional Shares hereunder are subject to (i)
the accuracy of and compliance with the representations
and warranties of the Fund and the Manager contained
herein on and as of the Option Closing Date as though
made on any Option Closing Date, (ii) satisfaction on
and as of any Option Closing Date of the conditions set
forth in this Section 9 except that, if any Option
Closing Date is other than the Closing Date, the
certificates, opinions and letters referred to in
paragraphs (b), (c), (d), (e), (f), (j), (k) and this
paragraph shall be dated the Option Closing Date in
question and the opinions and letters called for by
paragraphs (b), (c), (d) and (e) shall be revised to
reflect the sale of Additional Shares and (iii) the
absence of circumstances on or prior to the Option
Closing Date which would permit termination of this
Agreement pursuant to Section 11 hereof if they existed
on or prior to the Closing Date.
10. Effective Date of Agreement. This Agreement shall
become effective: (i) upon the execution and delivery hereof by
the parties hereto; or (ii) if, at the time this Agreement is
executed and delivered, it is necessary for the Registration
Statement or a post-effective amendment thereto to be declared
effective before the offering of the Shares may commence, when
notification of the effectiveness of the Registration Statement
or such post-effective amendment has been released by the
Commission. Until such time as this Agreement shall have become
effective, it may be terminated by the Fund by notifying you or
by you, as Representatives of the several Underwriters, by
notifying the Fund.
If any one or more of the Underwriters shall fail or
refuse to purchase Firm Shares which it or they have agreed to
purchase hereunder and the aggregate number of Firm Shares which
such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase is not more than one-tenth of the aggregate
number of the Firm Shares, each non-defaulting Underwriter shall
be obligated, severally, in the proportion which the aggregate
number of Firm Shares set forth opposite its name in Schedule I
hereto bears to the aggregate number of Firm Shares set forth
opposite the names of all non-defaulting Underwriters or in such
other proportion as you may specify in accordance with Section 20
38
of the ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Master Agreement Among Underwriters,
to purchase Firm Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase. If any
Underwriter or Underwriters shall fail or refuse to purchase Firm
Shares and the aggregate number of Firm Shares with respect to
which such default occurs is more than one-tenth of the aggregate
number of Firm Shares and arrangements satisfactory to you and
the Fund for the purchase of such Firm Shares by one or more
non-defaulting Underwriters or other party or parties approved by
you and the Fund are not made within 36 hours after such default,
this Agreement will terminate without liability on the part of
any non-defaulting Underwriter or the Fund. In any such case
which does not result in termination of this Agreement, either
you or the Fund shall have the right to postpone the Closing
Date, but in no event for longer than seven days, in order that
the required changes, if any, in the Registration Statement and
the Prospectus or any other documents or arrangements may be
effected. Any action taken under this paragraph shall not relieve
any defaulting Underwriter from liability in respect to any such
default of any such Underwriter under this Agreement. The term
"Underwriter" as used in this Agreement includes, for all
purposes of this Agreement, any party not listed in Schedule I
hereto who, with your approval and the approval of the Fund,
purchases Firm Shares which a defaulting Underwriter agreed, but
failed or refused, to purchase.
Any notice under this Section 10 may be made by
telegram, telecopy or telephone but shall be subsequently
confirmed by letter.
11. Termination of Agreement. This Agreement shall be
subject to termination in your absolute discretion, without
liability on the part of any Underwriter to the Fund or the
Manager by notice to the Fund or the Manager if prior to the
Closing Date or any Option Closing Date (if different from the
Closing Date and then only as to the Additional Shares), as the
case may be, (i) trading in the Shares or securities generally on
the NYSE, American Stock Exchange, Nasdaq National Market or the
Nasdaq Stock Market shall have been suspended or materially
limited, (ii) additional material governmental restrictions not
in force on the date of this Agreement have been imposed upon
trading in securities generally or a general moratorium on
commercial banking activities in New York shall have been
declared by either Federal or state authorities or (iii) any
outbreak or material escalation of hostilities or other
international or domestic calamity, crisis or change in
political, financial or economic conditions, occurs, the effect
of which is such as to make it, in your judgment, impracticable
or inadvisable to commence or continue the offering of the Shares
at the offering price to the public set forth on the cover page
of the Prospectus or to enforce contracts for the resale of the
39
Shares by the Underwriters. Notice of such termination may be
given to the Fund or the Manager by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
12. Expenses. The Fund agrees to pay the following
costs and expenses and all other costs and expenses incident to
the performance by the Fund of its obligations hereunder: (a) the
preparation, printing or reproduction, filing (including, without
limitation, the filing fees prescribed by the 1933 Act, the 1940
Act and the Rules and Regulations) and distribution of the
Registration Statement (including exhibits thereto), the
Prospectus, each Prepricing Prospectus and the 1940 Act
Notification and all amendments or supplements to any of them,
(b) the printing (or reproduction) and delivery (including
postage, air freight charges and charges for counting and
packaging) of such copies of the Registration Statement, the
Prospectus, each Prepricing Prospectus, any sales material and
all amendments or supplements to any of them as may be reasonably
requested for use in connection with the offering and sale of the
Shares, (c) the preparation, printing, authentication, issuance
and delivery of certificates for the Shares, including any stamp
taxes and transfer agent and registrar fees payable in connection
with the original issuance and sale of such Shares, (d) the
registrations or qualifications of the Shares for offer and sale
under the securities or Blue Sky laws of the several states as
provided in Section 5(g) hereof (including the reasonable fees,
expenses and disbursements of counsel for the Underwriters
relating to the preparation, printing or reproduction and
delivery of the preliminary and supplemental Blue Sky Memoranda
and such registration and qualification), (e) the fees and
expenses of the Fund's independent accountants, counsel for the
Fund and of the transfer agent, (f) the expenses of delivery to
the Underwriters and dealers (including postage, air freight and
the cost of counting and packaging) of copies of the Prospectus,
the Prepricing Prospectus, any sales material and all amendments
or supplements to the Prospectus as may be requested for use in
connection with the offering and sale of the Shares, (g) the
printing (or reproduction) and delivery of this Agreement, any
dealer agreements, the preliminary and supplemental Blue Sky
Memoranda and all other company-authorized agreements or other
documents printed (or reproduced) and delivered in connection
with the offering of the Shares, (h) the filing fees and the fees
and expenses of counsel for the Underwriters in connection with
any filings required to be made with the NASD and incurred with
respect to the review of the offering of the Shares by the NASD,
(i) the registration of the Shares under the 1934 Act and the
listing of the Shares on the NYSE, and (j) an amount equal to (A)
$20,000 plus (B) $.0025 per Share for each Share in excess of
2,000,000 sold pursuant to this Agreement, payable no later than
45 days from the date of this Agreement to the Underwriters in
partial reimbursement of their expenses (but not including
40
reimbursement for the cost of one tombstone advertisement in a
newspaper that is one-quarter of a newspaper page or less in
size) in connection with the offering.
Notwithstanding the foregoing, in the event that the
sale of the Firm Shares is not consummated pursuant to Section 2
hereof, the Manager will pay the costs and expenses of the Fund
set forth above in this Section 12 (a) through (i), and
reimbursements of Underwriter expenses in connection with the
offering shall be made in accordance with Section 5(k) hereof.
13. Information Furnished by the Underwriters. The
names of the underwriters and numbers of Shares listed opposite
such names in the first paragraph under the caption
"Underwriting" in the Prospectus, as well as, under the same
caption, the third paragraph, the first sentence of the tenth
paragraph, the eleventh paragraph and the fourteenth paragraph
constitute the only information relating to any Underwriter
furnished to the Fund in writing by or on behalf of the
Underwriters through you as such information is referred to
herein, expressly for use in the Prospectus.
14. Miscellaneous. Except as otherwise provided in
Sections 5, 10 and 11 hereof, notice given pursuant to any
provision of this Agreement shall be in writing and shall be
delivered (a) if to the Fund, Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., c/o
Alliance Capital Management L.P., ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or if to the Manager, Attn: ▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇., ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, or (b) if to you, as Representatives of the Underwriters,
at the office of ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. at ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Manager, Investment
Banking Division.
This Agreement has been and is made solely for the
benefit of the several Underwriters, the Fund, the Manager, their
trustees, directors and officers and the other controlling
persons referred to in Section 8 hereof and their respective
successors and assigns to the extent provided herein and no other
person shall acquire or have any right under or by virtue of this
Agreement. Neither the term "successor" or the term "successors
and assigns" as used in this Agreement shall include a purchaser
from any Underwriter of any of the Shares in his status as such
purchaser.
15. Applicable Law; Counterparts. This Agreement shall
be governed by and construed in accordance with the laws of the
State of New York.
This Agreement may be signed in various counterparts
which together constitute one and the same instrument. If signed
41
in counterparts, this Agreement shall not become effective unless
at least one counterpart hereof shall have been executed and
delivered on behalf of each party hereto.
42
Please confirm that the foregoing correctly sets forth
the agreement among the Fund and the Manager and the several
Underwriters.
Very truly yours,
ALLIANCE [CALIFORNIA] [NEW YORK]
MUNICIPAL INCOME FUND, INC.
By: ___________________________
Name:
Title:
ALLIANCE CAPITAL MANAGEMENT L.P.
By: ALLIANCE CAPITAL MANAGEMENT
CORPORATION, its general
partner
By: ____________________________
Name:
Title:
43
Confirmed as of the date
first above written on
behalf of themselves and
the other several Underwriters
named in Schedule I hereto.
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
PRUDENTIAL SECURITIES INCORPORATED
UBS WARBURG LLC
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & CO.
WEDBUSH ▇▇▇▇▇▇ SECURITIES, INC.
▇▇▇▇▇ FARGO ▇▇▇ ▇▇▇▇▇▇, LLC
AS REPRESENTATIVES OF THE SEVERAL UNDERWRITERS
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC.
By: _____________________
Title: Director
44
SCHEDULE I
Name of Underwriters Number of Common Shares
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
Total
45
00250209.A01