BlackRock New York Municipal 2018 Term Trust
(a Delaware business trust)
Auction Market Preferred Shares ("AMPS") of Beneficial Interest
1,256 Shares __ AMPS, Series T7
Liquidation Preference $25,000 per share
PURCHASE AGREEMENT
December [ ], 2001
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxxx Xxxxx Xxxxxx Inc.
c/x Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
North Tower
World Financial Center
New York, New York 10080
Ladies and Gentlemen:
BlackRock New York Municipal 2018 Term Trust, a Delaware business trust
(the "Trust"), proposes, upon the terms and conditions set forth herein, to
issue and sell an aggregate of 1,256 shares of its Auction Market Preferred
Shares of Beneficial Interest, Series T7, with a liquidation preference of
$25,000 per share (the "AMPS"). The AMPS will be authorized by, and subject to
the terms and conditions of, the Statement of Preferences of Auction Market
Preferred Shares of the Trust, dated as of December 13, 2001 (the "Statement")
and the Agreement and Declaration of Trust of the Trust, as amended and
restated, dated as of October 15, 2001 (the "Declaration"), in the forms filed
as exhibits to the Registration Statement referred to in the second following
paragraph of this Agreement, as the same may be amended from time to time. The
Trust, the Trust's investment adviser, BlackRock Advisors, Inc., a Delaware
corporation ("BAI"), and its investment sub-adviser, BlackRock Financial
Management, Inc., a Delaware corporation ("BFM") (each, an "Adviser" and
together, the "Advisers"), each confirms its agreement with Xxxxxxx Xxxxx & Co.,
Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx") and Xxxxxxx
Xxxxx Xxxxxx Inc. ("Salomon") and each of the other Underwriters named in
Schedule A hereto (collectively, the "Underwriters", which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom Xxxxxxx Xxxxx and Xxxxxxx are acting as representatives (in
such capacity, the "Representatives"), with respect to the issue and sale by the
Trust and the purchase by the Underwriters, acting severally and not jointly, of
the respective number of AMPS set forth in said Schedule A.
The Trust understands that the Underwriters propose to make a public
offering of the AMPS as soon as the Representatives deem advisable after this
Agreement has been executed and delivered.
The Trust has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form N-2 (No. 333-73148 and No.
811-10503) covering the registration of the AMPS under the Securities Act of
1933, as amended (the "1933 Act"), including the related preliminary prospectus
or prospectuses, and a notification on Form N-8A of registration (the "1940 Act
Notification") of the Trust as an investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"), and the rules and regulations
of the Commission under the 1933 Act and the 1940 Act (the
"Rules and Regulations"). Promptly after execution and delivery of this
Agreement, the Trust will either (i) prepare and file a prospectus in accordance
with the provisions of Rule 430A ("Rule 430A") of the Rules and Regulations and
paragraph (c) or (h) of Rule 497 ("Rule 497") of the Rules and Regulations or
(ii) if the Trust has elected to rely upon Rule 434 ("Rule 434") of the Rules
and Regulations, prepare and file a term sheet (a "Term Sheet") in accordance
with the provisions of Rule 434 and Rule 497. The information included in any
such prospectus or in any such Term Sheet, as the case may be, that was omitted
from such registration statement at the time it became effective but that is
deemed to be part of such registration statement at the time it became
effective, if applicable, (a) pursuant to paragraph (b) of Rule 430A is referred
to as "Rule 430A Information" or (b) pursuant to paragraph (d) of Rule 434 is
referred to as "Rule 434 Information." Each prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information, that was used
after such effectiveness and prior to the execution and delivery of this
Agreement, including in each case any statement of additional information
incorporated therein by reference, is herein called a "preliminary prospectus."
Such registration statement, including the exhibits thereto and schedules
thereto at the time it became effective and including the Rule 430A Information
and the Rule 434 Information, as applicable, is herein called the "Registration
Statement." Any registration statement filed pursuant to Rule 462(b) of the
Rules and Regulations is herein referred to as the "Rule 462(b) Registration
Statement," and after such filing the term "Registration Statement" shall
include the Rule 462(b) Registration Statement. The final prospectus in the form
first furnished to the Underwriters for use in connection with the offering of
the AMPS, including the statement of additional information incorporated therein
by reference, is herein called the "Prospectus." If Rule 434 is relied on, the
term "Prospectus" shall refer to the preliminary prospectus dated December [7],
2001 together with the Term Sheet and all references in this Agreement to the
date of the Prospectus shall mean the date of the Term Sheet. For purposes of
this Agreement, all references to the Registration Statement, any preliminary
prospectus, the Prospectus or any Term Sheet or any amendment or supplement to
any of the foregoing shall be deemed to include the copy filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("XXXXX").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all reference in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934 (the "1934 Act") which is
incorporated by reference in the Registration Statement, such preliminary
prospectus or the Prospectus, as the case may be.
SECTION 1. Representations and Warranties.
(a) REPRESENTATIONS AND WARRANTIES BY THE TRUST AND THE ADVISERS. The
Trust and the Advisers jointly and severally represent and warrant to each
Underwriter as of the date hereof, and as of the Closing Time referred to in
Section 2(c) hereof and agree with each Underwriter, as follows:
(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act, or order of
suspension or revocation of registration pursuant to Section 8(e) of the
1940 Act, and no proceedings for any such purpose have been instituted or
are pending or, to the knowledge of the Trust or the Advisers, are
contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with.
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At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time, the Registration Statement, the
Rule 462(b) Registration Statement, the notification of Form N-8A and any
amendments and supplements thereto complied and will comply in all
material respects with the requirements of the 1933 Act, the 1940 Act and
the Rules and Regulations and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading. Neither the Prospectus nor any amendments or supplements
thereto, at the time the Prospectus or any such amendment or supplement
was issued and at the Closing Time, included or will include an untrue
statement of a material fact or omitted or will omit to state a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. If Rule 434
is used, the Trust will comply with the requirements of Rule 434 and the
Prospectus shall not be "materially different", as such term is used in
Rule 434, from the prospectus included in the Registration Statement at
the time it became effective.
Each preliminary prospectus and the prospectus filed as part of
the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 497 under the 1933 Act,
complied when so filed in all material respects with the Rules and
Regulations and each preliminary prospectus and the Prospectus delivered
to the Underwriters for use in connection with this offering was
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
If a Rule 462(b) Registration Statement is required in connection
with the offering and sale of the AMPS, the Trust has complied or will
comply with the requirements of Rule 111 under the 1933 Act Regulations
relating to the payment of filing fees thereof.
(ii) INDEPENDENT ACCOUNTANTS. The accountants who certified the
statement of assets and liabilities included in the Registration
Statement are independent public accountants as required by the 1933 Act
and the Rules and Regulations.
(iii) FINANCIAL STATEMENTS. The statement of assets and
liabilities included in the Registration Statement and the Prospectus,
together with the related notes, presents fairly the financial position
of the Trust at the date indicated; said statement has been prepared in
conformity with generally accepted accounting principles ("GAAP").
(iv) INCORPORATED DOCUMENTS. The documents incorporated or deemed
to be incorporated by reference in the Registration Statement and the
Prospectus, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the 1933 Act and the Rules and Regulations and, when read
together with the other information in the Prospectus, at the date the
Registration Statement became effective, at the date the Prospectus was
issued and at the Closing Time, did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading.
(v) NO MATERIAL ADVERSE CHANGE. Since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Trust,
whether or not arising in the ordinary course of business (other than as
a result of changes in market conditions) (a "Material Adverse Effect"),
(B) there have been no transactions entered into by the Trust, other than
those in the ordinary course of business, which are material with respect
to the Trust, and (C) there has been
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no dividend or distribution of any kind declared, paid or made by the
Trust on any class of its capital stock except for dividends declared on
Common Stock.
(vi) GOOD STANDING OF THE TRUST. The Trust has been duly organized
and is validly existing as a business trust in good standing under the
laws of the State of Delaware and has business trust power and authority
to own, lease and operate its properties and to conduct its business as
described in the Prospectus and to enter into and perform its obligations
under this Agreement; and the Trust is duly qualified as a foreign
business trust to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would
not result in a Material Adverse Effect.
(vii) NO SUBSIDIARIES. The Trust has no subsidiaries.
(viii) INVESTMENT COMPANY STATUS. The Trust is duly registered
with the Commission under the 1940 Act as a closed-end non-diversified
management investment company, and no order of suspension or revocation
of such registration has been issued or proceedings therefor initiated or
threatened by the Commission.
(ix) OFFICERS AND TRUSTEES. No person is serving or acting as an
officer, trustee or investment adviser of the Trust except in accordance
with the provisions of the 1940 Act and the Rules and Regulations and the
Investment Advisers Act of 1940, as amended (the "Advisers Act"), and the
rules and regulations of the Commission promulgated under the Advisers
Act (the "Advisers Act Rules and Regulations"). Except as disclosed in
the Registration Statement and the Prospectus (or any amendment or
supplement to either of them), no trustee of the Trust is an "interested
person" (as defined in the 1940 Act) of the Trust or an "affiliated
person" (as defined in the 1940 Act) of any Underwriter.
(x) CAPITALIZATION. The authorized, issued and outstanding shares
of beneficial interest of the Trust is as set forth in the Prospectus as
of the date thereof under the caption "Capitalization." All issued and
outstanding shares of beneficial interest of the Trust have been duly
authorized and validly issued and are fully paid and non-assessable,
except as provided for in the Trust's declaration of trust, and have been
offered and sold or exchanged by the Trust in compliance with all
applicable laws (including, without limitation, federal and state
securities laws); none of the outstanding shares of beneficial interest
of the Trust was issued in violation of the preemptive or other similar
rights of any securityholder of the Trust.
(xi) AUTHORIZATION AND DESCRIPTION OF SHARES. The AMPS to be
purchased by the Underwriters from the Trust have been duly authorized
for issuance and sale to the Underwriters pursuant to this Agreement and,
when issued and delivered by the Trust pursuant to this Agreement against
payment of the consideration set forth herein, will be validly issued and
fully paid and non-assessable, except as provided for in the Trust's
declaration of trust. The AMPS in all material respects conform to all
statements relating thereto contained in the Prospectus and such
description in all material respects conforms to the rights set forth in
the instruments defining the same; no holder of the AMPS will be subject
to personal liability by reason of being such a holder; and the issuance
of the AMPS is not subject to the preemptive or other similar rights of
any securityholder of the Trust.
(xii) ABSENCE OF DEFAULTS AND CONFLICTS. The Trust is not in
violation of its declaration of trust or by-laws, or in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other 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 Trust is subject (collectively,
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"Agreements and Instruments") except for such violations or defaults that
would not result in a Material Adverse Effect; and the execution,
delivery and performance of this Agreement, the Investment Management
Agreement, the Sub-Investment Advisory Agreement, the Custodian
Agreement, the Transfer Agent and Service Agreement and the Auction
Agency Agreement referred to in the Registration Statement (as used
herein, the "Management Agreement," the "Sub-Advisory Agreement", the
"Custodian Agreement", the "Transfer Agency Agreement" and the "Auction
Agency Agreement" respectively) and the consummation of the transactions
contemplated herein and in the Registration Statement (including the
issuance and sale of the AMPS and the use of the proceeds from the sale
of the AMPS as described in the Prospectus under the caption "Use of
Proceeds") and compliance by the Trust with its obligations hereunder
have been duly authorized by all necessary corporate action and do not
and will not, whether with or without the giving of notice or passage of
time or both, conflict with or constitute a breach of, or default or
Repayment Event (as defined below) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Trust pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action
result in any violation of the provisions of the declaration of trust or
by-laws of the Trust or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over
the Trust or any of its assets, properties or operations. As used herein,
a "Repayment Event" means any event or condition which gives the holder
of any note, debenture or other evidence of indebtedness (or any person
acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the
Trust.
(xiii) ABSENCE OF PROCEEDINGS. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to the
knowledge of the Trust or the Advisers, threatened, against or affecting
the Trust, which is required to be disclosed in the Registration
Statement (other than as disclosed therein), or which might reasonably be
expected to result in a Material Adverse Effect, or which might
reasonably be expected to materially and adversely affect the properties
or assets of the Trust or the consummation of the transactions
contemplated in this Agreement or the performance by the Trust of its
obligations hereunder. The aggregate of all pending legal or governmental
proceedings to which the Trust is a party or of which any of its property
or assets is the subject which are not described in the Registration
Statement, including ordinary routine litigation incidental to the
business, could not reasonably be expected to result in a Material
Adverse Effect.
(xiv) ACCURACY OF EXHIBITS. There are no contracts or documents
which are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits thereto by the 1933 Act, the 1940
Act or by the Rules and Regulations which have not been so described and
filed as required.
(xv) POSSESSION OF INTELLECTUAL PROPERTY. The Trust owns or
possesses, or can acquire on reasonable terms, adequate patents, patent
rights, licenses, inventions, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service
marks, trade names or other intellectual property (collectively,
"Intellectual Property") necessary to carry on the business now operated
by the Trust, and the Trust has not received any notice or is not
otherwise aware of any infringement of or conflict with asserted rights
of others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Trust therein, and which
infringement or conflict (if the subject of any unfavorable decision,
ruling or finding) or invalidity or inadequacy, singly or in the
aggregate,
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would result in a Material Adverse Effect. The Trust does not own any
Intellectual Property concerning the name "Blackrock."
(xvi) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Trust of its
obligations hereunder, in connection with the offering, issuance or sale
of the AMPS hereunder or the consummation of the transactions
contemplated by this Agreement, except such as have been already obtained
or as may be required under the 1933 Act, the 1940 Act, the Securities
Exchange Act of 1934, as amended (the "1934 Act"), or state securities
laws.
(xvii) POSSESSION OF LICENSES AND PERMITS. The Trust possesses
such permits, licenses, approvals, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies necessary
to operate its properties and to conduct the business as contemplated in
the Prospectus; the Trust is in compliance with the terms and conditions
of all such Governmental Licenses, except where the failure so to comply
would not, singly or in the aggregate, have a Material Adverse Effect;
all of the Governmental Licenses are valid and in full force and effect,
except when the invalidity of such Governmental Licenses or the failure
of such Governmental Licenses to be in full force and effect would not
have a Material Adverse Effect; and the Trust has not received any notice
of proceedings relating to the revocation or modification of any such
Governmental Licenses which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in a Material
Adverse Effect.
(xviii) ADVERTISEMENTS. Any advertising, sales literature or other
promotional material (including "prospectus wrappers", "broker kits,"
"road show slides" and "road show scripts") authorized in writing by or
prepared by the Trust or the Advisers used in connection with the public
offering of the AMPS (collectively, "sales material") does not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
in light of the circumstances under which they were made, not misleading.
Moreover, all sales material complied and will comply in all material
respects with the applicable requirements of the 1933 Act, the 1940 Act,
the Rules and Regulations and the rules and interpretations of the
National Association of Securities Dealers, Inc. ("NASD").
(xix) SUBCHAPTER M. The Trust intends to direct the investment of
the proceeds of the offering described in the Registration Statement in
such a manner as to comply with the requirements of Subchapter M of the
Internal Revenue Code of 1986, as amended ("Subchapter M of the Code" and
the "Code," respectively), and as of the date of this Agreement qualifies
as a regulated investment company under Subchapter M of the Code.
(xx) DISTRIBUTION OF OFFERING MATERIALS. The Trust has not
distributed and, prior to the later to occur of (A) the Closing Time and
(B) completion of the distribution of the AMPS, will not distribute any
offering material in connection with the offering and sale of the AMPS
other than the Registration Statement, a preliminary prospectus, the
Prospectus or other materials, if any, permitted by the 1933 Act or the
1940 Act or the Rules and Regulations.
(xxi) ACCOUNTING CONTROLS. The Trust maintains a system of
internal accounting controls sufficient to provide reasonable assurances
that (A) transactions are executed in accordance with management's
general or specific authorization and with the applicable requirements of
the 1940 Act, the Rules and Regulations and the Code; (B) transactions
are recorded as necessary to permit preparation of financial statements
in conformity with generally accepted accounting principles and to
maintain accountability for assets and to maintain compliance with the
books and records requirements under the 1940 Act and the Rules and
6
Regulations; (C) access to assets is permitted only in accordance with
the management's general or specific authorization; and (D) the recorded
accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any
differences.
(xxii) ABSENCE OF UNDISCLOSED PAYMENTS. To The Trust's knowledge,
neither The Trust nor any employee or agent of The Trust has made any
payment of funds of The Trust or received or retained any funds, which
payment, receipt or retention of funds is of a character required to be
disclosed in the Prospectus.
(xxiii) MATERIAL AGREEMENTS. This Agreement, the Management
Agreement, the Sub-Advisory Agreement, the Custodian Agreement, the
Transfer Agency Agreement and the Auction Agency Agreement have each been
duly authorized by all requisite action on the part of the Trust,
executed and delivered by the Trust, as of the dates noted therein, and
each complies with all applicable provisions of the 1940 Act. Assuming
due authorization, execution and delivery by the other parties thereto
with respect to the Custodian Agreement, the Transfer Agency Agreement
and the Auction Agency Agreement, each of the Management Agreement, the
Sub-Advisory Agreement, the Custodian Agreement, the Transfer Agency
Agreement and the Auction Agency Agreement constitutes a valid and
binding agreement of the Trust, enforceable in accordance with its terms,
except as affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law).
(xxiv) REGISTRATION RIGHTS. There are no persons with registration
rights or other similar rights to have any securities registered pursuant
to the Registration Statement or otherwise registered by the Trust under
the 1933 Act.
(xxv) NYSE LISTING. The Trust's common shares are duly listed on
the New York Stock Exchange ("NYSE").
RATINGS. The AMPS have been, or prior to the Closing Date will be,
assigned a rating of 'Aaa' by Xxxxx'x Investors Service, Inc. ("Moody's")
and "AAA" by Standard & Poor's Rating Services ("S&P").
(b) REPRESENTATIONS AND WARRANTIES BY THE ADVISERS. The Advisers
represent and warrant to each Underwriter as of the date hereof, as of the
Closing Time referred to in Section 2(c) hereof as follows:
(i) GOOD STANDING OF THE ADVISERS. Each of the Advisers has been
duly organized and is validly existing and in good standing as
corporations under the laws of the State of Delaware with full corporate
power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and each is duly
qualified as a foreign corporation to transact business and is in good
standing in each other jurisdiction in which such qualification is
required.
(ii) INVESTMENT ADVISER STATUS. Each of Advisers is duly
registered and in good standing with the Commission as an investment
adviser under the Advisers Act, and is not prohibited by the Advisers Act
or the 1940 Act, or the rules and regulations under such acts, from
acting under the Management Agreement and the Sub-Advisory Agreement for
the Trust as contemplated by the Prospectus.
(iii) DESCRIPTION OF ADVISERS. The description of each Adviser in
the Registration Statement and the Prospectus (and any amendment or
supplement to either of them) complied and comply in all material
respects with the provisions of the 1933 Act, the 1940 Act, the Advisers
Act, the Rules and Regulations and the Advisers Act Rules and Regulations
and is true and correct and does not contain any untrue statement of a
material fact or omit to state any material
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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.
(iv) CAPITALIZATION. Each of the Advisers has the financial
resources available to it necessary for the performance of its services
and obligations as contemplated in the Prospectus, this Agreement and
under the respective Investment Management Agreement and the
Sub-Investment Advisory Agreement to which it is a party.
(v) AUTHORIZATION OF AGREEMENTS; ABSENCE OF DEFAULTS AND
CONFLICTS. This Agreement, the Management Agreement and the Sub-Advisory
Agreement have each been duly authorized, executed and delivered by each
respective Adviser, and the Management Agreement and the Sub-Advisory
Agreement each constitute a valid and binding obligation of each
respective Adviser, enforceable in accordance with its terms, except as
affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and general equitable principles
(whether considered in a proceeding in equity or at law); and neither the
execution and delivery of this Agreement, the Management Agreement or the
Sub-Advisory Agreement nor the performance by either of the Advisers of
its obligations hereunder or thereunder will conflict with, or result in
a breach of any of the terms and provisions of, or constitute, with or
without the giving of notice or lapse of time or both, a default under,
any agreement or instrument to which either Adviser is a party or by
which it is bound, the certificate of incorporation, the by-laws or other
organizational documents of each of the Advisers, or to each Adviser's
knowledge, by any law, order, decree, rule or regulation applicable to it
of any jurisdiction, court, federal or state regulatory body,
administrative agency or other governmental body, stock exchange or
securities association having jurisdiction over the Advisers or their
respective properties or operations; and no consent, approval,
authorization or order of any court or governmental authority or agency
is required for the consummation by the Advisers of the transactions
contemplated by this Agreement, the Management Agreement or the
Sub-Advisory Agreement, except as have been obtained or may be required
under the 1933 Act, the 1940 Act, the 1934 Act or state securities laws.
(vi) NO MATERIAL ADVERSE CHANGE. Since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, there has not occurred
any event which should reasonably be expected to have a material adverse
effect on the ability of either Adviser to perform its respective
obligations under this Agreement and the respective Investment Management
Agreement and Sub-Investment Advisory Agreement to which it is a party.
(vii) ABSENCE OF PROCEEDINGS. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to the
knowledge of the Advisers, threatened against or affecting either of the
Advisers or any "affiliated person" of either of the Advisers (as such
term is defined in the 1940 Act) or any partners, directors, officers or
employees of the foregoing, whether or not arising in the ordinary course
of business, which might reasonably be expected to result in any material
adverse change in the condition, financial or otherwise, or earnings,
business affairs or business prospects of either of the Advisers,
materially and adversely affect the properties or assets of either of the
Advisers or materially impair or adversely affect the ability of either
of the Advisers to function as an investment adviser or perform its
obligations under the Management Agreement or the Sub-Advisory Agreement,
or which is required to be disclosed in the Registration Statement and
the Prospectus.
(viii) ABSENCE OF VIOLATION OR DEFAULT. Each Adviser is not in
violation of its certificate of incorporation, by-laws or other
organizational documents or in default under any
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agreement, indenture or instrument except for such violations or defaults
that would not result in a Material Adverse Effect on the respective
Adviser or the Trust.
(c) OFFICER'S CERTIFICATES. Any certificate signed by any officer of the
Trust or the Advisers delivered to the Representatives or to counsel for the
Underwriters shall be deemed a representation and warranty by the Trust or the
Advisers, as the case may be, to each Underwriter as to the matters covered
thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) SHARES. On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Trust
agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Trust, at
the price per share set forth in SCHEDULE B, the number of Shares set forth in
SCHEDULE A opposite the name of such Underwriter, plus any additional number of
Shares which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
(b) COMMISSION. The Trust agrees to pay to the Underwriters a commission
set forth in Schedule B as compensation to the Underwriters for their
performance under this Agreement.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the AMPS shall be made at the offices of Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, 0 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or through the
facilities of The Depository Trust Company ("DTC") or at such other place as
shall be agreed upon by the Representatives and the Trust, at 10:00 A.M.
(Eastern time) on the business day after the date hereof (unless postponed in
accordance with the provisions of Section 10), or such other time not later than
ten business days after such date as shall be agreed upon by the Representatives
and the Trust (such time and date of payment and delivery being herein called
"Closing Time").
Payment shall be made to the Trust by wire transfer of immediately
available funds to a bank account designated by the Trust, against delivery to
the Representatives through DTC for the respective accounts of the Underwriters
of the AMPS to be purchased by them. It is understood that each Underwriter has
authorized the Representatives, for its account, to accept delivery of, receipt
for, and make payment of the purchase price for, the AMPS which it has agreed to
purchase. Xxxxxxx Xxxxx, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the AMPS to be purchased by any Underwriter whose funds have not been
received by the Closing Time but such payment shall not relieve such Underwriter
from its obligations hereunder.
(d) DENOMINATIONS; REGISTRATION. Certificates for the AMPS shall be in
such denominations and registered in such names as the Representatives may
request in writing at least one full business day before the Closing Time. The
certificates for the AMPS will be made available for examination and packaging
by the Representatives in the City of New York not later than 10:00 A.M.
(Eastern time) on the business day prior to the Closing Time.
SECTION 3. Covenants.
(a) The Trust and the Advisers, jointly and severally, covenant with each
Underwriter as follows:
(i) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION
REQUESTS. The Trust, subject to Section 3(a)(ii), will comply with the
requirements of Rule 430A or Rule 434, as applicable, and, except as
otherwise stated in (C) below, for a period of three years from the date
hereof, the Trust (in the case of (A), (B), (C)(i) and (D) below) and the
Advisors (in the case of (C)(ii) below) will advise you promptly and will
confirm such advice in writing: (A) of any request made by the Commission
for amendment of or a supplement to the Registration Statement, any
preliminary prospectus or the Prospectus (or any amendment or supplement
to any
9
of the foregoing) or for additional information, (B) of the issuance by
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 of
any order suspending the effectiveness of the Registration Statement,
prohibiting or suspending the use of the Prospectus or any preliminary
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 AMPS for offering or sale in any jurisdiction, or
the initiation of any proceeding for any such purposes, (C) of receipt by
(i) the Trust, any affiliate of the Trust or any representative or
attorney of the Trust of any other material communication adverse to the
Trust from the Commission or (ii) the Trust, the Advisors, any affiliate
of the Trust or the Advisors or any representative or attorney of the
Trust or the Advisors of any other material communication adverse to the
Trust from the Commission, the NASD, any state securities commission, any
national securities exchange, any arbitrator, any court or any other
governmental, regulatory, self-regulatory or administrative agency or any
official relating to the Trust (if such communication relating to the
Trust is received by such person within three years after the date of
this Agreement), the Registration Statement, the 1940 Act Notification,
the Prospectus, any preliminary prospectus, any sales material (or any
amendment or supplement to any of the foregoing) or this Agreement or any
of the Trust Agreements and (D) within the period of time referred to in
paragraph (iv) below, of any material adverse change in the condition
(financial or other), general affairs, assets or results of operations of
the Trust or any event which should reasonably be expected to have a
material adverse effect on the ability of either Advisor to perform its
respective obligations under this Agreement and the Advisory Agreements
to which it is a party (in either case, other than as a result of changes
in market conditions generally or the market for municipal securities
generally) or of the happening of any other event which makes any
statement of a material fact made in the Registration Statement or the
Prospectus, or any preliminary prospectus (or any amendment or supplement
to any of the foregoing) untrue or which requires the making of any
additions to or changes in the Registration Statement or the Prospectus,
or any preliminary prospectus (or any amendment or supplement to any of
the foregoing) in order to state a material fact required by the 1933
Act, the 1940 Act or the Rules and Regulations to be stated therein or
necessary in order to make the statements therein (in the case of a
prospectus, in light of the circumstances under which they were made) not
misleading, or of the necessity to amend or supplement the Registration
Statement, the Prospectus, or any preliminary prospectus (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 shall issue
any order suspending the effectiveness of the Registration Statement,
prohibiting or suspending the use of the Prospectus or any sales material
(or any amendment or supplement to any of the foregoing) or suspending
the qualification of the AMPS for offering or sale in any jurisdiction,
the Trust and the Advisors will use their reasonable best efforts to
obtain the withdrawal of such order at the earliest possible time. If at
any time 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 prohibiting or suspending the use of the Prospectus
or any sales material (or any amendment or supplement to any of the
foregoing) or suspending the qualification of the AMPS for offering or
sale in any jurisdiction, the Advisors will use their reasonable best
efforts to obtain the withdrawal of such order at the earliest possible
time. The Trust will notify the Representatives immediately, and, if
requested by the Representatives, confirm the notice in writing, (i) when
any post-effective amendment to the Registration Statement shall become
effective, or any supplement to the Prospectus or any amended Prospectus
shall have been filed, (ii) of the receipt of any comments from the
Commission, (iii) of any request by the Commission for any amendment to
the Registration Statement or any amendment or supplement to the
Prospectus or for additional information, and (iv) of the issuance
10
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use
of any preliminary prospectus, or of the suspension of the qualification
of the AMPS for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such purposes.
The Trust will promptly effect the filings necessary pursuant to Rule 497
and will take such steps as it deems necessary to ascertain promptly
whether the form of prospectus transmitted for filing under Rule 497 was
received for filing by the Commission and, in the event that it was not,
it will promptly file such prospectus. The Trust will make every
reasonable effort to prevent the issuance of any stop order, or order of
suspension or revocation of registration pursuant to Section 8(e) of the
1940 Act, and, if any such stop order or order of suspension or
revocation of registration is issued, to obtain the lifting thereof at
the earliest possible moment.
(ii) FILING OF AMENDMENTS. The Trust will give the Representatives
notice of its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)), any Term
Sheet or any amendment, supplement or revision to either the prospectus
included in the Registration Statement at the time it became effective or
to the Prospectus, will furnish the Representatives with copies of any
such documents a reasonable amount of time prior to such proposed filing
or use, as the case may be, and will not file or use any such document to
which the Representatives or counsel for the Underwriters shall object.
(iii) DELIVERY OF REGISTRATION STATEMENTS. The Trust has furnished
or will deliver to the Representatives and counsel for the Underwriters,
without charge, signed copies of the Registration Statement as originally
filed and of each amendment thereto (including exhibits filed therewith
or incorporated by reference therein) and signed copies of all consents
and certificates of experts, and will also deliver to the
Representatives, without charge, a conformed copy of the Registration
Statement as originally filed and of each amendment thereto (without
exhibits) for each of the Underwriters. The copies of the Registration
Statement and each amendment thereto furnished to the Underwriters will
be identical to the electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(iv) DELIVERY OF PROSPECTUSES. The Trust has delivered to each
Underwriter, without charge, as many copies of each preliminary
prospectus as such Underwriter reasonably requested, and the Trust hereby
consents to the use of such copies for purposes permitted by the 1933
Act. The Trust will furnish to each Underwriter, without charge, during
the period when in the opinion of counsel for the Underwriter the
Prospectus is required under the 1933 Act to be delivered in connection
with sales by any Underwriter or dealer or the 1934 Act, such number of
copies of the Prospectus (as amended or supplemented) as such Underwriter
may reasonably request. The Prospectus and any amendments or supplements
thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(v) CONTINUED COMPLIANCE WITH SECURITIES LAWS. If at any time when
a prospectus is required by the 1933 Act to be delivered in connection
with sales of the AMPS, any event shall occur or condition shall exist as
a result of which it is necessary, in the opinion of counsel for the
Underwriters or for the Trust, to amend the Registration Statement or
amend or supplement the Prospectus in order that the Prospectus will not
include any untrue statements of a material fact or omit to state a
material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of
such counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the
requirements of the 1933 Act or the Rules and Regulations, the Trust will
promptly prepare and file with the Commission,
11
subject to Section 3(a)(ii), such amendment or supplement as may be
necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements,
and the Trust will furnish to the Underwriters such number of copies of
such amendment or supplement as the Underwriters may reasonably request.
(vi) BLUE SKY QUALIFICATIONS. The Trust will use its best efforts,
in cooperation with the Underwriters, to qualify the AMPS for offering
and sale under the applicable securities laws of such states and other
jurisdictions of the United States as the Representatives may designate
and to maintain such qualifications in effect for a period of not less
than one year from the later of the effective date of the Registration
Statement and any Rule 462(b) Registration Statement; provided, however,
that the Trust shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a dealer
in AMPS in any jurisdiction in which it is not so qualified or to subject
itself to taxation in respect of doing business in any jurisdiction in
which it is not otherwise so subject. In each jurisdiction in which the
AMPS have been so qualified, the Trust will file such statements and
reports as may be required by the laws of such jurisdiction to continue
such qualification in effect for a period of not less than one year from
the effective date of the Registration Statement and any Rule 462(b)
Registration Statement.
(vii) RULE 158. The Trust will timely file such reports pursuant
to the 1934 Act as are necessary in order to make generally available to
its securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
(viii) USE OF PROCEEDS. The Trust will use the net proceeds
received by it from the sale of the AMPS in the manner specified in the
Prospectus under "Use of Proceeds".
(ix) REPORTING REQUIREMENTS. The Trust, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934
Act, will file all documents required to be filed with the Commission
pursuant to the 1940 Act and the 1934 Act within the time periods
required by the 1940 Act and the Rules and Regulations and the 1934 Act
and the rules and regulations of the Commission thereunder, respectively.
(x) SUBCHAPTER M. The Trust will comply with the requirements of
Subchapter M of the Code to qualify as a regulated investment company
under the Code.
(xi) NO MANIPULATION OF MARKET FOR SHARES. The Trust will not (a)
take, directly or indirectly, any action designed to cause or to result
in, or that might reasonably be expected to constitute, the stabilization
or manipulation of the price of any security of the Trust to facilitate
the sale or resale of the AMPS, and (b) until the Closing Date, or the
Date of Delivery, if any, (i) sell, bid for or purchase the AMPS or pay
any person any compensation for soliciting purchases of the AMPS or (ii)
pay or agree to pay to any person any compensation for soliciting another
to purchase any other Shares of the Trust.
(xii) RULE 462(b) REGISTRATION STATEMENT. If the Trust elects to
rely upon Rule 462(b), the Trust shall file a Rule 462(b) Registration
Statement with the Commission in compliance with Rule 462(b) by 10:00
P.M., Washington, D.C. time, on the day following the date of this
Agreement, and the Trust shall at the time of filing either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or
give irrevocable instructions for the payment of such fee pursuant to
Rule 111(b) under the 1933 Act.
(xiii) ACCOUNTANT'S CERTIFICATE. The Trust will furnish to the
Underwriters, on the date on which delivery is made to the Rating
Agencies, the report and the confirmation of the Independent Accountant
(as defined in the Statement) required to be delivered pursuant to
paragraph 7(f) of Part I of the Statement.
12
(b) Except as provided in this Agreement, the Trust will not sell,
contract to sell or otherwise dispose of any of its preferred shares of
beneficial interest of the same series as the AMPS or any securities convertible
into or exercisable or exchangeable for its preferred shares of beneficial
interest of the same series as the AMPS, or grant any options or warrants to
purchase its preferred shares of beneficial interest of the same series as the
AMPS, for a period of 180 days after the date of the Prospectus, without the
prior written consent of Xxxxxxx Xxxxx.
SECTION 4. Payment of Expenses.
(a) EXPENSES. The Trust will pay all expenses incident to the performance
of its obligations under this Agreement, including (i) the preparation, printing
and filing of the Registration Statement (including financial statements and
exhibits) as originally filed and of each amendment thereto, (ii) the
preparation, printing and delivery to the Underwriters of this Agreement, any
Agreement among Underwriters and such other documents as may be required in
connection with the offering, purchase, sale, issuance or delivery of the AMPS,
(iii) the preparation, issuance and delivery of the certificates for the AMPS to
the Underwriters, including any stock or other transfer taxes and any stamp or
other duties payable upon the sale, issuance or delivery of the AMPS to the
Underwriters, (iv) the fees and disbursements of the Trust's counsel,
accountants and other advisors, (v) the qualification of the AMPS under
securities laws in accordance with the provisions of Section 3(a)(vi) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus,
Prospectus and any amendments or supplements thereto, (vii) the preparation,
printing and delivery to the Underwriters of copies of the Blue Sky Survey and
any supplement thereto, (viii) the fees and expenses of any transfer agent or
registrar for the AMPS, (ix) the filing fees incident to, and the reasonable
fees and disbursements of counsel to the Underwriters in connection with, the
review by the NASD of the terms of the sale of the AMPS, (x) the fees and
expenses incurred in connection with the rating of the AMPS and (xi) the
printing of any sales material.
(b) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5 or Section 9(a)
hereof, the Trust and the Advisers, jointly and severally, agree that they shall
reimburse the Underwriters for all of their out-of-pocket expenses, including
the reasonable fees and disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations.
The obligations of the several Underwriters hereunder are subject to the
accuracy in all material respects of the representations and warranties of the
Trust and the Advisers contained in Section 1 hereof or in certificates of any
officer of the Trust or the Advisers delivered pursuant to the provisions
hereof, to the performance by the Trust and the Advisers of their respective
covenants and other obligations hereunder, and to the following further
conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act, no notice or order pursuant
to Section 8(e) of the 1940 Act shall have been issued, and no proceedings with
respect to either shall have been initiated or threatened by the Commission, and
any request on the part of the Commission for additional information shall have
been complied with to the reasonable satisfaction of counsel to the
Underwriters. A prospectus containing the Rule 430A Information shall have been
filed with the Commission in accordance with Rule 497 (or a post-effective
amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rule 430A) or, if the Trust has
elected to rely upon Rule 434, a Term Sheet shall have been filed with the
Commission in accordance with Rule 497.
13
(b) OPINION OF COUNSEL FOR TRUST AND THE ADVISERS. At Closing Time, the
Representatives shall have received the favorable opinions, dated as of Closing
Time, of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the Trust, and
Xxxxxx X. Xxxxxxxx, counsel for the Advisers, in form and substance satisfactory
to counsel for the Underwriters, together with signed or reproduced copies of
such letters for each of the other Underwriters to the effect set forth in
EXHIBIT A hereto and to such further effect as counsel to the Underwriters may
reasonably request.
(c) OPINION OF COUNSEL FOR UNDERWRITERS. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Xxxxxxxx Chance Xxxxxx & Xxxxx LLP, counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of the other
Underwriters with respect to the matters set forth in clauses (A) (i), (ii),
(iv), (v), (ix), (x) (solely as to preemptive or other similar rights arising by
operation of law or under the charter or by-laws of the Trust) inclusive, (xi)
(solely as to the information in the Prospectus under "Description of AMPS"),
(xiii) and the penultimate paragraph of EXHIBIT A hereto. In giving such opinion
such counsel may rely, as to all matters governed by the laws of jurisdictions
other than the law of the State of New York and the federal law of the United
States, upon the opinions of counsel satisfactory to the Representatives. Such
counsel may also state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of officers
of the Trust and certificates of public officials.
(d) OFFICERS' CERTIFICATES. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition, financial
or otherwise, or in the earnings or business affairs of the Trust, whether or
not arising in the ordinary course of business, and the Representatives shall
have received a certificate of a duly authorized officer of the Trust and of the
Treasurer of the Trust and of the President or a Vice President or Managing
Director of each of the Advisers, dated as of Closing Time, to the effect that
(i) there has been no such material adverse change, (ii) the representations and
warranties in Sections 1(a) and (b) hereof are true and correct in all material
respects with the same force and effect as though expressly made at and as of
Closing Time, (iii) each of the Trust and the Advisers, respectively, has
complied in all material respects with all agreements and satisfied all
conditions on its part to be performed or satisfied in all material respects at
or prior to Closing Time, and (iv) no stop order suspending the effectiveness of
the Registration Statement, or order of suspension or revocation of registration
pursuant to Section 8(e) of the 1940 Act, has been issued and no proceedings for
any such purpose have been instituted or are pending or are contemplated by the
Commission.
(e) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of this
Agreement, the Representatives shall have received from Deloitte & Touche LLP a
letter dated such date, in form and substance satisfactory to the
Representatives, together with signed or reproduced copies of such letter for
each of the other Underwriters containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
(f) BRING-DOWN COMFORT LETTER. At Closing Time, the Representatives shall
have received from Deloitte & Touche LLP a letter, dated as of Closing Time, to
the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (e) of this Section, except that the specified date
referred to shall be a date not more than three business days prior to Closing
Time.
(g) NO OBJECTION. The NASD has confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(h) RATING. The Trust shall have delivered and you shall have received
evidence satisfactory to you that the AMPS are rated 'Aaa' by Xxxxx'x and 'AAA'
by S&P as of the Closing Date, and there shall not have been given any notice of
any intended or potential
14
downgrading, or of any review for a potential downgrading, in the rating
accorded to the AMPS or any other securities issued by the Trust, by Xxxxx'x or
by S&P.
(i) ASSET COVERAGE. As of the Closing Date and assuming the receipt of
the net proceeds from the sale of the AMPS, the Investment Company Act Preferred
Shares Asset Coverage and the Preferred Shares Basic Maintenance Amount (each as
defined in the Statement) each will be met.
(j) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of Delivery,
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may reasonably require for the purpose of enabling them to pass
upon the issuance and sale of the AMPS as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Trust and the Advisers in connection with the organization and
registration of the Trust under the 1940 Act and the issuance and sale of the
AMPS as herein contemplated shall be reasonably satisfactory in form and
substance to the Representatives and counsel for the Underwriters.
(k) TERMINATION OF AGREEMENT. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement may be terminated by the Representatives by notice to the Trust at any
time at or prior to Closing Time, and such termination shall be without
liability of any party to any other party except as provided in Section 4 and
except that Sections 1, 6, 7, 8 and 13 shall survive any such termination and
remain in full force and effect.
SECTION 6. Indemnification.
(a) INDEMNIFICATION OF UNDERWRITERS. The Trust and the Advisers, jointly
and severally, agree to indemnify and hold harmless each 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, as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
and the Rule 434 Information, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact
included in any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission; provided that (subject to
Section 6(e) below) any such settlement is effected with the written
consent of the Trust; and
(iii) against any and all expense whatsoever, as incurred
(including the reasonable fees and disbursements of counsel chosen by
Xxxxxxx Xxxxx), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense
is not paid under (i) or (ii) above;
15
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Trust or the
Advisers by any Underwriter through Xxxxxxx Xxxxx expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto).
(b) INDEMNIFICATION OF TRUST, ADVISERS, TRUSTEES, DIRECTORS AND OFFICERS.
Each Underwriter severally agrees to indemnify and hold harmless the Trust and
the Advisers, their respective trustees and directors, each of the Trust's
officers who signed the Registration Statement, and each person, if any, who
controls the Trust or the Advisers within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act against any and all loss, liability, claim,
damage and expense described in the indemnity contained in subsection (a) of
this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Trust or the Advisers by
such Underwriter through Xxxxxxx Xxxxx expressly for use in the Registration
Statement (or any amendment thereto) or such preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
(c) INDEMNIFICATION FOR MARKETING MATERIALS. In addition to the foregoing
indemnification, the Trust and the Advisers also, jointly and severally, agree
to indemnify and hold harmless each 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, against any and all loss, liability, claim, damage
and expense described in the indemnity contained in Section 6(a), as limited by
the proviso set forth therein, with respect to any sales material.
(d) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Xxxxxxx Xxxxx, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Trust and the Advisers. An
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
16
SECTION 7. Contribution.
If the indemnification provided for in Section 6 hereof is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Trust and the Advisers on the one
hand and the Underwriters on the other hand from the offering of the AMPS
pursuant to this Agreement or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Trust and the Advisers on the one hand and of the
Underwriters on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Trust and the Advisers on the one
hand and the Underwriters on the other hand in connection with the offering of
the AMPS pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the AMPS pursuant to
this Agreement (before deducting expenses) received by the Trust and the total
underwriting discount received by the Underwriters (whether from the Trust or
otherwise), in each case as set forth on the cover of the Prospectus, or, if
Rule 434 is used, the corresponding location on the Term Sheet, bear to the
aggregate initial public offering price of the AMPS as set forth on such cover.
The relative fault of the Trust and the Advisers on the one hand and
the Underwriters on the other hand shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Trust or the Advisers or by the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Trust, the Advisers and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 7 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 which does not take account
of the equitable considerations referred to above in this Section 7. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 7 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the AMPS underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of any such untrue or alleged
untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each trustee of the Trust and each director of the Advisers, respectively, each
officer of the Trust who signed the Registration Statement, and each person, if
any, who controls the Trust or the Advisers, within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Trust and the Advisers, respectively. The
17
Underwriters' respective obligations to contribute pursuant to this Section 7
are several in proportion to the number of AMPS set forth opposite their
respective names in SCHEDULE A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Trust or the Advisers submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or controlling
person, or by or on behalf of the Trust or the Advisers, and shall survive
delivery of the AMPS to the Underwriters.
SECTION 9. Termination of Agreement.
(a) TERMINATION; GENERAL. The Representatives may terminate this
Agreement, by notice to the Trust, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Trust or the Advisers,
whether or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States or the international financial markets, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development
involving a prospective change in national or international political, financial
or economic conditions, in each case the effect of which is such as to make it,
in the judgment of the Representatives, impracticable or inadvisable to market
the AMPS or to enforce contracts for the sale of the AMPS, or (iii) if trading
in the common shares of the Trust has been suspended or materially limited by
the Commission or the NYSE, or if trading generally on the American Stock
Exchange or the NYSE or in the Nasdaq National Market has been suspended or
materially limited, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the NASD or any other governmental
authority, or a material disruption has occurred in commercial banking or
securities settlement or clearance services in the United States, or (iv) if a
banking moratorium has been declared by either Federal or New York authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7, 8 and 13 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the Underwriters.
If one or more of the Underwriters shall fail at Closing Time or a Date
of Delivery to purchase the AMPS which it or they are obligated to purchase
under this Agreement (the "Defaulted Shares"), the Representatives shall have
the right, within 24 hours thereafter, to make arrangements for one or more of
the non-defaulting Underwriters, or any other underwriters, to purchase all, but
not less than all, of the Defaulted Shares in such amounts as may be agreed upon
and upon the terms herein set forth; if, however, the Representatives shall not
have completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Shares does not exceed 10% of the number
of Shares to be purchased on such date, each of the non-defaulting Underwriters
shall be obligated, severally and not jointly, to purchase the full amount
thereof in the proportions that their respective underwriting obligations
hereunder bear to the underwriting obligations of all non-defaulting
Underwriters, or
(b) if the number of Defaulted Shares exceeds 10% of the number
of Shares to be purchased on such date, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
18
In the event of any such default which does not result in a termination
of this Agreement, either the Representatives or the Trust shall have the right
to postpone Closing Time for a period not exceeding seven days in order to
effect any required changes in the Registration Statement or Prospectus or in
any other documents or arrangements. As used herein, the term "Underwriter"
includes any person substituted for an Underwriter under this Section 10.
SECTION 11. Notices.
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Underwriters shall be directed to the
Representatives, c/x Xxxxxxx Xxxxx & Co., North Tower, World Financial Center,
New York, New York 10080, attention of Equity Capital Markets; and notices to
the Trust or the Advisers shall be directed, as appropriate, to the office of
BlackRock Financial Management, Inc. at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxx X. Xxxxxxxxxxx.
SECTION 12. Parties.
This Agreement shall each inure to the benefit of and be binding upon
the Underwriters, the Trust, the Advisers and their respective partners and
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters, the Trust, the Advisers and their respective successors and the
controlling persons and officers, trustees and directors referred to in Sections
6 and 7 and their heirs and legal representatives, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the Underwriters, the Trust, the
Advisers and their respective partners and successors, and said controlling
persons and officers, trustees and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Shares from any Underwriter shall be deemed to be a successor by
reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED IN SAID STATE. UNLESS OTHERWISE EXPLICITLY PROVIDED, SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
19
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the Underwriters, the Trust and the Advisers in accordance with its terms.
Very truly yours,
BlackRock New York Municipal 2018 Term Trust
By:
-------------------------------------------------
Name:
Title:
BlackRock Advisors, Inc.
By:
-------------------------------------------------
Name:
Title:
BlackRock Financial Management, Inc.
By:
-------------------------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
XXXXXXX XXXXX XXXXXX INC.
By: XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By:
------------------------------------------------
Authorized Signatory
For themselves and as
Representatives of the
other Underwriters named
in SCHEDULE A hereto.
20
SCHEDULE A
Number of
NAME OF UNDERWRITER Shares
------------------- ---------------
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx Incorporated........... [ ]
Xxxxxxx Xxxxx Xxxxxx Inc..................................... [ ]
UBS Warburg LLC.............................................. [ ]
Prudential Securities Incorporated........................... [ ]
Total............................................... [ ]
==========
Sch A-1
SCHEDULE B
BLACKROCK NEW YORK MUNICIPAL 2018 TERM TRUST
[ ] Auction Market Preferred Shares of Beneficial Interest
Series _____
Liquidation Preference $25,000 per share
1. The initial public offering price per share for the AMPS, determined
as provided in said Section 2, shall be $25,000.
2. The purchase price per share for the AMPS to be paid by the several
Underwriters shall be $25,000.
3. The commission to be paid to the Underwriters for their performance
hereunder shall be $[ ] per share.
4. The initial dividend rate on the AMPS shall be ___% per annum.
Sch B-1
Exhibit A
FORM OF OPINION OF TRUST'S AND ADVISERS'
COUNSEL TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(A) With respect to the Trust:
(i) The Trust has been created and is in good standing and has a
legal existence as a statutory business trust under the Delaware Business
Trust Act. The opinion set forth in this paragraph (i) with respect to
the good standing and legal existence of the Trust as a statutory
business trust under the Delaware Business Trust Act is based solely on a
review of the Delaware Good Standing Certificate.
(ii) The Trust has the necessary power and authority under the
Delaware Business Trust Act as a business trust to execute, deliver and
perform all of its obligations under the Purchase Agreement and the
Transaction Agreements. The execution and delivery of the Purchase
Agreement and the Transaction Agreements and the consummation by the
Trust of the transactions contemplated thereby have been duly authorized
by all requisite action on the part of the Trust under Delaware Business
Trust Act. Each of the Purchase Agreement and the Transaction Agreements
has been duly executed and delivered by the Trust under the Applicable
Laws of the State of New York and the Commonwealth of Massachusetts, as
the case may be, to the extent applicable.
(iii) Each of the Transaction Agreements constitutes the valid and
binding obligation of the Trust enforceable against the Trust in
accordance with its terms under the Applicable Laws of the State of New
York or the Commonwealth of Massachusetts, as the case may be.
(iv) The execution and delivery by the Trust of the Purchase
Agreement and each of the Transaction Agreements and the performance by
the Trust of its obligations under the Purchase Agreement and each of the
Transaction Agreements, each in accordance with its terms, do not (i)
conflict with the Declaration or By-laws of the Trust, (ii) constitute a
violation of, or a default under, any Applicable Contract or (iii) cause
the creation of any security interest or lien upon any of the property of
the Trust pursuant to any Applicable Contract. We do not express any
opinion, however, as to whether the execution, delivery or performance by
the Trust of the Purchase Agreement or the Transaction Agreements will
constitute a violation of, or a default under, any covenant, restriction
or provision with respect to financial ratios or tests or any aspect of
the financial condition or results of operations of the Trust.
(v) Neither the execution, delivery or performance by the Trust of
its obligations under the Purchase Agreement or the Transaction
Agreements nor the compliance by the Trust with the terms and provisions
thereof will contravene any provision of Applicable Law or the 1940 Act
or the rules and regulations of the Commission under the 1940 Act.
(vi) No Governmental Approval, which has not been obtained or
taken and is not in full force and effect, is required to authorize, or
is required in connection with, the execution, delivery or performance of
the Purchase Agreement or any of the Transaction Agreements by the Trust.
(vii) Neither the execution, delivery or performance by the Trust
of its obligations under the Purchase Agreement or the Transaction
Agreements nor compliance by the Trust with the terms and provisions
thereof will contravene any Applicable Order.
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(viii) The Tr ust is registered with the Commission pursuant to
Section 8 of the 1940 Act as a non-diversified, closed-end management
investment company; and the Declaration and By-Laws comply in all
material respects with the 1940 Act and the 1940 Act Rules and
Regulations.
(ix) As of the date of the Prospectus, the Trust has an
authorized, issued and outstanding capitalization as set forth in the
Prospectus (without giving effect to the issuance and sale of the AMPS to
you pursuant to the Purchase Agreement); all of the outstanding Common
Shares have been duly authorized and validly issued, and are fully paid
and non-assessable (except as provided in the last sentence of Section
3.8 of the Declaration) undivided beneficial ownership interests in the
assets of the Trust; the AMPS have been duly authorized by all necessary
action of the Trust under the Delaware Business Trust Act and, when
issued and delivered to and paid for by the Underwriters pursuant to the
Purchase Agreement, will be validly issued, fully paid and non-assessable
(except as provided in the last sentence of Section 3.8 of the
Declaration) undivided beneficial ownership interests in the assets of
the Trust.
(x) No holders of outstanding Common Shares are entitled as such
to any preemptive or other rights to subscribe for any AMPS under any
Applicable Contract, under the Declaration or By-Laws or under the
Delaware Business Trust Act..
(xi) The statements set forth under the headings "Description of
AMPS," "The Auction" and "Description of Common Shares" in the
Prospectus, insofar as such statements purport to summarize certain
provisions of the 1940 Act, the Delaware Business Trust Act, the AMPS,
the Common Shares or the Declaration, fairly summarize such provisions in
all material respects; the statements in the Prospectus under the
captions "The Trust's Investments - Municipal Bonds - Economic and Other
Conditions in New York" and "Tax Matters - New York Tax Matters" (in the
Prospectus) and "Investment Policies and Techniques - Factors Pertaining
to New York" (in the Statement of Additional Information), insofar as
such statements constitute matters of law or legal conclusions, fairly
summarize the information shown; and the statements contained in the
Prospectus under the heading "Tax Matters -- Federal Income Tax Matters"
(in the Prospectus) and "Tax Matters" (in the Statement of Additional
Information) to such extent that such statements constitute matters of
law or legal conclusions provide a fair summary of such law or
conclusions, which statements are based on the current United States tax
laws and our understanding of the Trust's proposed operations as
disclosed in the Prospectus.
(xii) No legal or governmental proceedings are pending to which
the Trust is a party that are required to be described in the
Registration Statement or the Prospectus and are not so described
therein, and no contract or other document is required to be described in
the Registration Statement or Prospectus or to be filed as an exhibit to
the Registration Statement that is not described therein or filed as
required. In rendering the opinion set forth in this paragraph 12, we
have relied solely on the Officer's Certificate; we have made no other
inquiries or investigations or any search of the public docket records of
any court, governmental agency or body or administrative agency.
(xiii) The filing of the Prospectus pursuant to Rule 497(h) under
the 1933 Act Rules and Regulations has been made in the manner and within
the time period required by Rule 497(h) of the rules and regulations of
the Commission under the 1933 Act.
(xiv) The Registration Statement, the Prospectus and the 1940 Act
Notification (in each case, other than the financial statements and other
financial and/or statistical information contained therein or
incorporated therein by reference and other than any exhibits, schedules
or appendices included or incorporated by reference therein, as to which
we express no opinion) comply as to form in all material respects with
the applicable requirements of the 1933 Act, the
A-2
1940 Act, the 1933 Act Rules and Regulations and the rules and
regulations of the Commission under the 1940 Act ("the 1940 Act Rules and
Regulations"). Subject to the opinion set forth above in paragraph 11, we
do not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement, and
the Prospectus.
(B) With respect to the Advisers:
(xv) Each Adviser has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of
Delaware.
(xvi) Each Adviser has full corporate power and authority to own,
lease and operate its properties and to conduct its business as described
in the Prospectus and to enter into and perform its obligations under the
Purchase Agreement.
(xvii) Each Adviser is duly qualified as a foreign corporation to
transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the ownership
or leasing of property or the conduct of business, except where the
failure to so qualify would not result in a Material Adverse Effect.
(xviii) Each Adviser is duly registered with the Commission as an
investment adviser under the Advisers Act and is not prohibited by the
Advisers Act, the Advisers Act Rules and Regulations, the 1940 Act or the
Rules and Regulations from acting under the Management Agreement for the
Trust as contemplated by the Prospectus.
(xix) The Purchase Agreement, the Management Agreement and the
Sub-Advisory Agreement have been duly authorized, executed and delivered
by the respective Adviser, and the Management Agreement and the
Sub-Advisory Agreement each constitutes a valid and binding obligation of
the respective Adviser, enforceable in accordance with its terms, except
as affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and general equitable principles
(whether considered in a proceeding in equity or at law).
(xx) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to
which the Advisers are a party, or to which the property of the Advisers
is subject, before or brought by any court or governmental agency or
body, domestic or foreign, which might reasonably be expected to result
in any material adverse change in the condition, financial or otherwise,
in the earnings, business affairs or business prospects of the Advisers,
materially and adversely affect the properties or assets of the Advisers
or materially impair or adversely affect the ability of the Advisers to
function as an investment adviser or perform its obligations under the
Management Agreement or the Sub-Advisory Agreement, or which is required
to be disclosed in the Registration Statement or the Prospectus.
(xxi) To the best of our knowledge, there are no franchises,
contracts, indentures, mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described
or referred to therein or filed or incorporated by reference as exhibits
thereto, and the descriptions thereof or references thereto are correct
in all material respects.
(xxii) To the best of our knowledge, each Adviser is not in
violation of its certificate of incorporation, by-laws or other
organizational documents and no default by the Advisers exists in the due
performance or observance of any material obligation, agreement, covenant
or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument that is described
or referred to in the Registration Statement or the Prospectus or filed
or incorporated by reference as an exhibit to the Registration Statement.
A-3
(xxiii) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency, domestic or foreign (other than under
the 1933 Act, the 1940 Act and the Rules and Regulations, which have been
obtained, or as may be required under the AMPS or blue sky laws of the
various states, as to which we need express no opinion) is necessary or
required in connection with the due authorization, execution and delivery
of the Purchase Agreement.
(xxiv) The execution, delivery and performance of the Purchase
Agreement and the consummation of the transactions contemplated in the
Purchase Agreement and in the Registration Statement and compliance by
the Advisers with their obligations under the Purchase Agreement do not
and will not, whether with or without the giving of notice or lapse of
time or both, conflict with or constitute a breach of, or default or
Repayment Event (as defined in Section 1(a)(xii) of the Purchase
Agreement) under or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Advisers
pursuant to any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or any other agreement or instrument, known
to us, to which the Advisers is a party or by which it or any of them may
be bound, or to which any of the property or assets of the Advisers is
subject (except for such conflicts, breaches or defaults or liens,
charges or encumbrances that would not have a Material Adverse Effect),
nor will such action result in any violation of the provisions of the
charter or by-laws of the Advisers, or any applicable law, statute, rule,
regulation, judgment, order, writ or decree, known to us, of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Advisers or any of its properties, assets or
operations.
In addition, we have participated in the preparation of the
Registration Statement and the Prospectus and participated in discussions with
certain officers, trustees and employees of the Trust, representatives of
Deloitte & Touche LLP, the independent accountants who examined the statement of
assets and liabilities of the Trust included or incorporated by reference in the
Registration Statement and the Prospectus, and you and your representatives and
we have reviewed certain Trust records and documents. While we have not
independently verified and are not passing upon, and do not assume any
responsibility for, the accuracy, completeness or fairness of the information
contained in the Registration Statement and the Prospectus, except to the extent
necessary to enable us to give the opinions with respect to the Trust in
paragraphs (A)(v), (xiv) and (xix), on the basis of such participation and
review, nothing has come to our attention that would lead us to believe that the
Registration Statement (except for financial statements, supporting schedules
and other financial data included therein or omitted therefrom and for
statistical information derived from such financial statements, supporting
schedules or other financial data, as to which we do not express any belief), at
the time such Registration Statement became effective, 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 not misleading or
that the Prospectus (except for financial statements, supporting schedules and
other financial data included therein or omitted therefrom and for statistical
information derived from such financial statements, supporting schedules or
other financial data, as to which we do not express any belief), at the time the
Prospectus was issued, or at the Closing Time, included or includes an untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
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