XXXX AND XXXX LLP
C O U N S E L L O R S A T L A W
xxxxxxxx.xxx
00 XXXXX XXXXXX - XXXXXX, XX 00000
000-000-0000 - FAX 000-000-0000
August 22, 2002
Xxxx Xxxxxxx Preferred Income Fund
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Ladies and Gentlemen:
Xxxx Xxxxxxx Preferred Income Fund (the "Fund") was established as a
Massachusetts business trust under an Agreement and Declaration of Trust dated
June 27, 2002 (the "Declaration of Trust"). The beneficial interests thereunder
are represented by transferable shares of beneficial interest, no par value.
The Trustees have the powers set forth in the Declaration of Trust,
subject to the terms, provisions and conditions therein provided. Pursuant to
Article V, Section 5.1 of the Declaration of Trust, the number of shares of
beneficial interest authorized to be issued under the Declaration of Trust is
unlimited and the Trustees are authorized to divide the shares into one or more
series of shares and one or more classes thereof as they deem necessary or
desirable. Pursuant to Article V, Section 5.4 of the Declaration of Trust, the
Trustees are empowered in their discretion to issue shares of any series for
such amount and type of consideration, including cash or securities, and on such
terms as the Trustees may authorize, all without action or approval of the
shareholders. As of the date of this opinion, the Trustees have divided the
shares of the Fund into one class of shares.
We have examined the Declaration of Trust and By-Laws, each as amended
from time to time, of the Fund, and such other documents as we have deemed
necessary or appropriate for the purposes of this opinion, including, but not
limited to, originals, or copies certified or otherwise identified to our
satisfaction, of such documents, Fund records and other instruments. In our
examination of the above documents, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals and
the conformity to original documents of all documents submitted to us as
certified of photostatic copies.
Any reference to "our knowledge", to any matter "known to us", "coming to
our attention" or "of which we are aware" or any variation of any of the
foregoing shall mean the conscious awareness of the attorneys in this firm who
have rendered substantive attention to the preparation of the Fund's
Registration Statement on Form N-2 or any amendments thereto, of the existence
or absence of any facts which would contradict the opinions set forth below. We
have not undertaken any independent investigation to determine the existence or
absence of such facts, and no inference as to our knowledge of the existence or
absence of such facts should be drawn from the fact of our representation of the
Fund. Without limiting the foregoing, we have not
BOSTON LONDON* MUNICH* NEW YORK OXFORD* PRINCETON RESTON WALTHAM WASHINGTON
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Xxxx and Xxxx LLP is a Massachusetts Limited Liability Partnership and includes Professional Corporations
* an independent joint venture law firm
Xxxx Xxxxxxx Preferred Income Fund
August 22, 2002
Page 2
examined any dockets or records of any court, administrative tribunal or other
similar entity, or any electronic or computer databases, in connection with our
opinions expressed below.
Our opinions below are qualified to the extent that they may be subject
to or affected by (i) applicable bankruptcy, insolvency, reorganization,
fraudulent conveyance or transfer, moratorium or similar laws affecting the
rights and remedies of creditors generally, (ii) statutory or decisional law
concerning recourse by creditors to security in the absence of notice or hearing
and (iii) duties and standards imposed on creditors and parties to contracts,
including, without limitation, requirements of good faith, reasonableness and
fair dealing. Further, we do not express any opinion as to (i) the availability
of the remedy of specific performance or any other equitable remedy upon breach
of any provision of any agreement whether applied by a court of law or equity,
(ii) the successful assertion of any equitable defense, or (iii) the right of
any party to enforce the indemnification or contribution provisions of any
agreement.
In rendering the opinion below, insofar as it relates to the good
standing and valid existence of the Fund, we have relied solely on a certificate
of the Secretary of State of the Commonwealth of Massachusetts, dated as of a
recent date, and such opinion is limited accordingly and is rendered as of the
date of such certificate.
This opinion is limited to the laws of the Commonwealth of
Massachusetts relating to business trusts, and we express no opinion with
respect to the laws of any other jurisdiction or to any other laws of the
Commonwealth of Massachusetts. Further, we express no opinion as to compliance
with any state or federal securities laws, including the securities laws of the
Commonwealth of Massachusetts.
Our opinion below, as it relates to the non-assessability of the shares
of the Fund, is qualified to the extent that, under Massachusetts law,
shareholders of a Massachusetts business trust may be held personally liable for
the obligations of the Fund. However, the Declaration of Trust disclaims
shareholder liability for acts or obligations of the Fund. Also, the Declaration
of Trust provides for indemnification out of Fund property for all loss and
expense of any shareholder held personally liable for the obligations of the
Fund.
Subject to the foregoing, we are of the opinion that the Fund is a duly
organized and validly existing business trust in good standing under the laws of
the Commonwealth of Massachusetts and that the shares of beneficial interest of
the Fund, when issued in accordance with the terms, conditions, requirements and
procedures set forth in the Declaration of Trust, the Fund's Registration
Statement on Form N-2 and the Underwriting Agreement between the Fund and UBS
Warburg LLC and Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx, Incorporated, as
representatives of the underwriters named therein, will constitute legally and
validly issued, fully paid and non-assessable shares of beneficial interest in
the Fund, subject to compliance with the Securities Act of 1933, as amended, the
Investment Company Act of 1940, as amended, and the applicable state laws
regulating the sale of securities.
We are opining only as to the specific legal issues expressly set forth
herein, and no opinion should be inferred as to any other matters. We are
opining on the date hereof as to the law in effect on the date hereof, and we
disclaim any obligation to advise you of any change in any of these sources of
law or subsequent legal or factual developments that might affect any matters of
opinions set forth herein.
Xxxx Xxxxxxx Preferred Income Fund
August 22, 2002
Page 3
This opinion is furnished to you solely for your use and may not be
quoted to or relied upon by any other person or entity or used for any other
purpose, without our prior written consent.
We consent to your filing this opinion with the Securities and Exchange
Commission (the "Commission") as an exhibit to any amendments to the Fund's
Registration Statement with the Commission. Except as provided in this
paragraph, this opinion may not be relied upon by, or filed with, any other
parties or for any other purpose.
Very truly yours,
/s/ Xxxx and Xxxx LLP
Xxxx and Xxxx LLP
