[ ] SHARES
XXXXXXXX NEW TECHNOLOGIES FUND II, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
----------------------
June , 2000
Xxxxxxx Xxxxx Barney Inc.
PaineWebber Incorporated
As Representatives of the Several Underwriters
c/o Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The undersigned, Xxxxxxxx New Technologies Fund II, Inc., a Maryland
corporation (the "Fund"), J.& X. Xxxxxxxx & Co. Incorporated, a Delaware
corporation (the "Manager"), and Xxxxxxxx Advisors, Inc., a Delaware corporation
("Xxxxxxxx Advisors"), address you as Underwriters and as the representatives
(the "Representatives") of each of the other persons, firms and corporations, if
any, listed in Schedule I hereto (herein collectively called "Underwriters").
The Fund proposes to issue and sell an aggregate of [__________] shares of its
common stock, $.01 par value per share (the "Shares"), to the several
Underwriters.
The Fund and the Manager wish to confirm as follows their agreements
with you and the other several Underwriters on whose behalf you are acting in
connection with the several purchases of the Shares by the Underwriters.
The Fund is entering into an investment management agreement with the
Manager dated May 18, 2000 and a Custody Agreement with Investors Fiduciary
Trust Company dated [ ], 2000 and such agreements are herein referred to as the
"Management Agreement" and the "Custodian Agreement", respectively.
Collectively, the Management Agreement and the
Custodian Agreement are herein referred to as the "Fund Agreements." This
Underwriting Agreement is herein referred to as the "Agreement."
1. Registration Statement and Prospectus. The Fund has prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended (the
"1933 Act"), the Investment Company Act of 1940, as amended (the "1940 Act"),
and the rules and regulations of the Commission under the 1933 Act (the "1933
Act Rules and Regulations") and the 1940 Act (the "1940 Act Rules and
Regulations" and together with the 1933 Act Rules and Regulations, the "Rules
and Regulations") a registration statement on Form N-2 (File Nos. 333-32222 and
811-09849 under the 1933 Act and the 1940 Act, respectively) (the "registration
statement"), including a prospectus and statement of additional information
relating to the Shares, and a notification of registration of the Fund as an
investment company under the 1940 Act on Form N-8A (the "1940 Act
Notification"), and may pursuant to the Rules and Regulations prepare and file
an additional registration statement relating to a portion of the Shares
pursuant to Rule 462(b) of the 1933 Act Rules and Regulations (a "Rule 462
registration statement"). The term "Registration Statement" as used in this
Agreement means the registration statement (including all financial schedules
and exhibits), as amended at the time it becomes effective under the 1933 Act
or, if the registration statement became effective under the 1933 Act prior to
the execution of this Agreement, as amended or supplemented thereto, prior to
the execution of this Agreement and includes any information deemed to be
included by Rule 430A under the 1933 Act Rules and Regulations. If it is
contemplated, at the time this Agreement is executed, that a post-effective
amendment to the registration statement will be filed under the 1933 Act and
must be declared effective before the offering of Shares may commence, the term
"Registration Statement" as used in this Agreement means the Registration
Statement as amended by said post-effective amendment. If the Fund has filed a
Rule 462 registration statement, then the reference herein to the term
Registration Statement shall include such Rule 462 registration statement. The
term "Prospectus" as used in this Agreement means the prospectus and statement
of additional information in the forms included in the Registration Statement
or, if the prospectus and statement of additional infor-
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mation included in the Registration Statement omit information in reliance on
Rule 430A under the 1933 Act Rules and Regulations and such information is
included in a prospectus and statement of additional information filed with the
Commission pursuant to Rule 497(h) under the 1933 Act Rules and Regulations, the
term "Prospectus" as used in this Agreement means the prospectus and statement
of additional information in the forms included in the Registration Statement as
supplemented by the addition of the information contained in the prospectus
(including the statement of additional information) filed with the Commission
pursuant to Rule 497(h). The term "Prepricing Prospectus" as used in this
Agreement means the prospectus and statement of additional information subject
to completion in the form included in the registration statement at the time of
the initial filing of the registration statement with the Commission and as such
prospectus and statement of additional information shall have been amended from
time to time prior to the date of the Prospectus, together with any other
prospectus (including any other statement of additional information) relating to
the Fund other than the Prospectus. The terms "registration statement,"
"Registration Statement," "Prospectus" and "Prepricing Prospectus" shall also
include any financial statements and other information included or incorporated
by reference therein.
The Fund has furnished the Representatives with copies of such
registration statement, each amendment to such registration statement filed with
the Commission and each Prepricing Prospectus.
2. Agreements to Sell, Purchase and Compensate. The Fund hereby agrees,
subject to all the terms and conditions set forth herein, to issue and to sell
to each Underwriter and, upon the basis of the representations, warranties and
agreements of the Fund and the Manager herein contained and subject to all of
the other terms and conditions set forth herein, each Underwriter agrees,
severally and not jointly, to purchase from the Fund at a purchase price of
$23.70 per Share (the "Price per Share"), the number of Shares set forth
opposite the name of such Underwriter in Schedule I hereto; provided, however,
that the Fund shall not be required to sell to any Underwriter any Shares as to
which such Underwriter is unable to certify to the Fund in writing on the date
hereof (the "Execution Date") that such Underwriter (i) has a firm
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offer to purchase such Shares from a customer (A) from whom it has received an
Investor Certification indicating that such customer is a Qualified Investor (as
defined in the Prospectus) or (B) that it otherwise believes is a Qualified
Investor or (ii) has a firm offer to purchase such Shares from a broker or
dealer that has entered into a Shareholder Servicing Agreement(as hereinafter
defined) with the Fund who has informed the Fund in writing of the matters
referred to in clause (i) as to such Shares. In the event that the Fund
determines as to any Shares not to sell such Shares to an Underwriter pursuant
to the foregoing proviso, the number of Shares set forth opposite the name of
such Underwriter in Schedule I shall be adjusted accordingly and such Shares
shall be offered for purchase at the Price per Share to one or more of the other
Underwriters and one or more of such Underwriters shall have the right to
purchase such Shares and Schedule I shall be adjusted to reflect the purchase of
any such Shares by any Underwriter.
The Manager agrees that it or Xxxxxxxx Advisors will, and Xxxxxxxx
Advisors agrees that if requested by the Manager it will, make the payments to
the Representatives as required by Section 4(c) hereof.
3. Terms of Public Offering. The Fund and the Manager have been advised
by you that the Underwriters propose to make a public offering of their
respective portions of the Shares as soon after the Registration Statement and
this Agreement have become effective as in your judgment is advisable and
initially to offer the Shares upon the terms set forth in the Prospectus.
4. Delivery of Shares and Payments Therefor.
----------------------------------------
(a) Delivery to the Underwriters of and payment to the Fund for
the Shares shall be made by means of the National Securities Clearing
Corporation ("NSCC") Fund/SERV System (or by another mutually
agreeable means) and shall be effected by the settlement of trade
details that are transmitted to NSCC by the Fund and each Underwriter
on the Execution Date (in accordance with the procedures of the NSCC).
The closing shall occur at 9:00 a.m. New York City time on June , 2000
(the "Closing Date") at the office of Xxxxxxx Xxxxx Barney Inc., 388
0
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or another mutually
agreeable facility. The Closing Date may be varied by agreement
between you and the Fund.
(b) The Shares shall be registered in such names and in such
denominations as the Underwriters shall request in accordance with the
procedures of the NSCC on the Execution Date.
(c) Simultaneous with delivery to the Underwriters of, and
payment by the Underwriters for, the Shares, the Manager or, as the
case may be, Xxxxxxxx Advisors, will pay to the Representatives
additional compensation in connection with the sale and distribution
of the Shares in the form of an advisory fee in an aggregate amount
equal to 2% of the total gross offering price of the Shares to be
purchased by the Underwriters hereunder, by certified or official bank
check or checks payable in New York Clearing House (same-day) funds or
wire transfer allocated 60% to Xxxxxxx Xxxxx Xxxxxx Inc. and 40% to
PaineWebber Incorporated to the order of such Representative.
5. Agreements of the Fund and the Manager. The Fund and the Manager,
jointly and severally, agree with the several Underwriters as follows:
(a) If, at the time this Agreement is executed and delivered, it
is necessary for the Registration Statement or a post-effective
amendment thereto to be declared effective under the 1933 Act before
the offering of the Shares may commence, the Fund will use its best
efforts to cause the Registration Statement or such post- effective
amendment to become effective under the 1933 Act as soon as possible.
If the Registration Statement has become effective and the Prospectus
contained therein omits certain information at the time of
effectiveness pursuant to Rule 430A of the 1933 Act Rules and
Regulations, the Fund will file a prospectus including such
information pursuant to Rule 497(h) of the 1933 Act Rules and
Regulations, as promptly as practicable, but no later than the second
business day following the earlier of the date of the determination of
the offering price of the Shares or the date the Prospectus is first
used after
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the effective date of the Registration Statement. If the Registration
Statement has become effective and the Prospectus contained therein
does not so omit such information, the Fund will file a Prospectus or
certification pursuant to Rule 497(c) or (j), as the case may be, of
the 1933 Act Rules and Regulations as promptly as practicable, but no
later than the fifth business day following the date of the later of
the effective date of the Registration Statement or the commencement
of the public offering of the Shares after the effective date of the
Registration Statement. The Fund will advise you promptly and, if
requested by you, will confirm such advice in writing (i) when the
Registration Statement or such post-effective amendment has become
effective, (ii) when the Prospectus has been timely filed pursuant to
Rule 497(c) or Rule 497(h) of the 1933 Act Rules and Regulations or
(iii) when the certification permitted pursuant to Rule 497(j) of the
1933 Act Rules and Regulations has been timely filed, whichever is
applicable.
(b) The Fund, and in the case of (iii)(B) below, the Manager,
will advise you promptly and, if requested by you, will confirm such
advice in writing: (i) of any request made by the Commission for
amendment of or a supplement to the Registration Statement, the
Prospectus or any Prepricing Prospectus (or any amendment or
supplement to any of the foregoing) or for additional information,
(ii) 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, any Prepricing Prospectus or any sales
material (as hereinafter defined), of any notice pursuant to Section
8(e) of the 1940 Act, of the suspension of qualification of the Shares
for offering or sale in any jurisdiction, or the initiation or
contemplated initiation of any proceeding for any such purposes, (iii)
of receipt by (A) the Fund, any affiliate of the Fund or any
representative or attorney of the Fund of any other material
communication from the Commission, or (B) the
6
Fund, the Manager, any affiliate of the Fund or the Manager or any
representative or attorney of the Fund or the Manager of any other
material communication from the Commission, the NASD, any state
securities commission, any national securities exchange, any
arbitrator, any court or any other governmental, regulatory, self-
regulatory or administrative agency or any official relating, in the
case of either clause (A) or (B), to the Fund (if such communication
relating to the Fund is received by such person within three years
after the date of this Agreement), the Registration Statement, the
1940 Act Notification, the Prospectus, any Prepricing Prospectus, any
sales material (or any amendment or supplement to any of the
foregoing) or this Agreement or any of the Fund Agreements and (iv)
within the period of time referred to in paragraph (f) below, of any
material, adverse change in the condition (financial or other),
general affairs, business, prospects, properties, net assets or
results of operations of the Fund or any event which should reasonably
be expected to have a material adverse effect on the ability of the
Manager to perform its obligations under this Agreement and the
Management Agreement (other than as a result of changes in market
conditions generally) or of the happening of any event which makes any
statement of a material fact made in the Registration Statement, the
Prospectus, any Prepricing Prospectus or any sales material (as
hereinafter defined) (or any amendment or supplement to any of the
foregoing) untrue or which requires the making of any additions to or
changes in the Registration Statement, the Prospectus, any Prepricing
Prospectus or any sales material (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 or any sales material, in light of the
circumstances under which they were made) not misleading or of the
necessity to amend or supplement the Registration Statement, the
Prospectus, any Prepricing Prospectus or any sales material (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
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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 Shares for offering
or sale in any jurisdiction, the Fund and the Manager will use their
best efforts to obtain the withdrawal of such order at the earliest
possible time. If at any time the NASD, any national securities
exchange, any state securities commission, any arbitrator, any court
or any other governmental, regulatory, self-regulatory or
administrative agency or any official shall issue any order suspending
the effectiveness of the Registration Statement, prohibiting or
suspending the use of the Prospectus or any sales material (or any
amendment or supplement to any of the foregoing) or suspending the
qualification of the Shares for offering or sale in any jurisdiction,
the Fund and the Manager will use their best efforts to obtain the
withdrawal of such order at the earliest possible time.
(c) The Fund will furnish to you, without charge, three signed
copies of the registration statement and the 1940 Act Notification as
originally filed with the Commission and of each amendment thereto,
including financial statements and all exhibits thereto and will also
furnish to you, without charge, such number of conformed copies of the
registration statement as originally filed and of each amendment
thereto, with or without exhibits, as you may reasonably request.
(d) The Fund will not (i) file any amendment to the registration
statement or the Registration Statement or make any amendment or
supplement to the Prospectus, any Prepricing Prospectus or any sales
material (or any amendment or supplement to any of the foregoing) of
which you shall not previously have been advised or to which you shall
reasonably object within a reasonable time after being so advised or
(ii) so long as, in the opinion of counsel for the Underwriters, a
Prospectus is required to be delivered in connection with sales by any
Underwriter or dealer, file any information, documents or reports
pursuant to the 1933 Act, the 1940 Act or the Securities Exchange Act
of 1934, as amended, without
8
delivering a copy of such information, documents or reports to you, as
Representatives of the Underwriters, prior to or concurrently with
such filing.
(e) Prior to the execution and delivery of this Agreement, the
Fund has delivered to you, without charge, in such quantities as you
have reasonably requested, copies of each form of any Prepricing
Prospectus. The Fund consents to the use, in accordance with the
provisions of the 1933 Act and with the securities or Blue Sky laws of
the jurisdictions in which the Shares are offered by the several
Underwriters and by dealers, prior to the date of the Prospectus, of
each Prepricing Prospectus so furnished by the Fund.
(f) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time, for such period as in the
opinion of counsel for the Underwriters a prospectus is required by
the 1933 Act to be delivered in connection with sales of Shares by any
Underwriter or dealer, the Fund will expeditiously deliver to each
Underwriter and each dealer, without charge, as many copies of the
Prospectus (and of any amendment or supplement thereto) as you may
reasonably request. The Fund consents to the use of the Prospectus
(and of any amendments or supplements thereto) in accordance with the
provisions of the 1933 Act and with the securities or Blue Sky laws of
the jurisdictions in which the Shares are offered by the several
Underwriters and by all dealers to whom Shares may be sold, both in
connection with the offering or sale of the Shares and for such period
of time thereafter as the Prospectus is required by law to be
delivered in connection with sales of Shares by any Underwriter or
dealer. If during such period of time any event shall occur that in
the judgment of the Fund or in the opinion of counsel for the
Underwriters is required to be set forth in the Registration Statement
or the Prospectus (as then amended or supplemented) or should be set
forth therein in order to make the statements therein (in the case of
the Prospectus, in light of the circumstances under which they were
made) not misleading or if it is necessary to supplement or amend the
Registration Statement or the Prospectus to comply with the 1933 Act,
the 1940 Act, the
9
Rules and Regulations or any other law, rule or regulation, the
Fund will forthwith notify you of such event, prepare and, subject to
the provisions of paragraph (d) above, promptly file with the
Commission an appropriate amendment or supplement thereto and will
expeditiously furnish to the Underwriters and dealers, without charge,
such number of copies thereof as they may reasonably request. In the
event that the Registration Statement or the Prospectus is to be
amended or supplemented, the Fund, if requested by you, will promptly
issue a press release announcing or disclosing the matters to be
covered by the proposed amendment or supplement.
(g) Subject to and in compliance with the description contained
in the Prospectus and the terms of any agreement between the Fund and
any broker or dealer that provides for such broker or dealer to
provide ongoing shareholder services to customers of such broker or
dealer that hold Shares (each, a "Shareholder Servicing Agreement"),
the Fund will pay the ongoing shareholder servicing fees (in
accordance with the description thereof in the Prospectus).
(h) The Fund will cooperate with you and with counsel for the
Underwriters in connection with the registration or qualification of
the Shares for offering and sale by the several Underwriters and by
dealers under the securities or Blue Sky laws of such jurisdictions
within the United States as you may designate and will file such
consents to service of process or other documents necessary or
appropriate in order to effect such registration or qualification;
provided that in no event shall the Fund be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to
take any action which would subject it to service of process in suits,
other than those arising out of the offering or sale of the Shares, in
any jurisdiction where it is not now so subject.
(i) The Fund will make generally available to its security
holders an earnings statement, which need not be audited, covering a
twelve-month period commencing after the effective date of the
Registration Statement and
10
ending not later than 15 months thereafter, as soon as practicable
after the end of such period, which earnings statement shall satisfy
the provisions of Section 11(a) of the 1933 Act and Rule 158 of the
1933 Act Rules and Regulations.
(j) The Fund will comply with the undertaking set forth in
paragraph III of Item 33 of Part C of the Registration Statement.
(k) During the period of five years hereafter, the Fund will
furnish or will have furnished to you (i) as soon as available, a copy
of each report of the Fund mailed to shareholders or filed with the
Commission and (ii) from time to time such other information
concerning the Fund as you may reasonably request except for Forms
N-SAR.
(l) If this Agreement shall terminate or be terminated after
execution pursuant to any provisions hereof (otherwise than by notice
given by you terminating this Agreement pursuant to Section 11 hereof
or by notice given by the Fund terminating this Agreement pursuant to
Section 10 hereof) or if this Agreement shall be terminated by the
Underwriters because of (i) any failure or refusal on the part of the
Fund or the Manager to comply with any term or fulfill any of the
conditions of this Agreement required to be complied with or fulfilled
by them, or (ii) the non-occurrence of any other condition in Section
9, the Fund and the Manager, jointly and severally, agree to reimburse
the Representatives for all out-of-pocket expenses (including fees and
expenses of counsel for the Underwriters) incurred by you in
connection herewith.
(m) The Fund will direct the investment of the net proceeds of
the offering of the Shares (i) in accordance with the description set
forth in the Prospectus and (ii) in such a manner as to comply with
the investment objectives, policies and restrictions of the Fund as
described in the Prospectus.
(n) The Fund will file the requisite copies of the Prospectus
with the Commission in a timely fashion
11
pursuant to Rule 497(c) or Rule 497(h) of the 1933 Act Rules and
Regulations, whichever is applicable or, if applicable, will file in a
timely fashion the certification permitted by Rule 497(j) of the 1933
Act Rules and Regulations and will advise you of the time and manner
of such filing.
(o) Except as provided in the Agreement or pursuant to any
dividend reinvestment plan of the Fund, the Fund will not sell,
contract to sell or otherwise dispose of, any common stock or any
securities convertible into or exercisable or exchangeable for common
stock or grant any options or warrants to purchase common stock, for a
period of 120 days after the date of the Prospectus, without the prior
written consent of Xxxxxxx Xxxxx Xxxxxx Inc.
(p) Except as stated in this Agreement and in the Prospectus,
neither the Fund nor the Manager has taken, nor will it take, directly
or indirectly, any action designed to or that might reasonably be
expected to cause or result in stabilization or manipulation of the
price of the Shares.
(q) The Fund will direct the investment of the proceeds of the
offering of the Shares so as to comply with the requirements of
Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code"), to qualify as a regulated investment company under the Code.
6. Representations and Warranties of the Fund and the Manager. The Fund
and the Manager, jointly and severally, represent and warrant to each
Underwriter that:
(a) Each Prepricing Prospectus included as part of the
registration statement as originally filed or as part of any amendment
or supplement thereto or filed pursuant to Rule 497 of the 1933 Act
Rules and Regulations, complied when so filed in all material respects
with the provisions of the 1933 Act, the 1940 Act and the Rules and
Regulations and the Commission has not issued any order preventing or
suspending the use of the Prepricing Prospectus.
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(b) The registration statement in the form in which it became or
becomes effective and also in such form as it may be when any
post-effective amendment thereto shall become effective, the
Prospectus and any amendment or supplement thereto when filed with the
Commission under Rule 497 of the 1933 Act Rules and Regulations and
the 1940 Act Notification when originally filed with the Commission
and any amendment or supplement thereto when filed with the Commission
complied or will comply in all material respects with the provisions
of the 1933 Act, the 1940 Act and the Rules and Regulations and each
of the Registration Statement and the Prospectus (or any supplement or
amendment to either of them) did not or will not at any such times
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading; except that
this representation and warranty does not apply to statements in or
omissions from the Registration Statement and the Prospectus (and any
amendment or supplement to either of them) made in reliance upon and
in conformity with information relating to any Underwriter furnished
to the Fund in writing by or on behalf of any Underwriter through you
expressly for use therein.
(c) All the outstanding shares of capital stock of the Fund have
been duly authorized and validly issued, are fully paid and, except as
described in the Registration Statement, nonassessable and are free of
any preemptive or similar rights, the Shares have been duly authorized
and, when issued and delivered to the Underwriters against payment
therefor in accordance with the terms hereof, will be validly issued,
fully paid and, except as described in the Registration Statement,
nonassessable and free of any preemptive or similar rights and the
capital stock of the Fund conforms to the description thereof in the
Registration Statement or the Prospectus (or any amendment or
supplement to either of them). Except for the Shares and the shares of
common stock issued in accordance with Section 14(a) of the 1940 Act,
no other shares of capital stock are issued or outstanding and the
capitalization of the Fund conforms
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in all respects to the description thereof in the Registration
Statement or the Prospectus (or any amendment or supplement to either
of them).
(d) The Fund has been duly formed and is validly existing in good
standing as a corporation under the laws of the State of Maryland,
with full corporate power and authority to own its properties and to
conduct its business as described in the Registration Statement and
the Prospectus (and any amendment or supplement to either of them) and
is duly registered and qualified to conduct business and is in good
standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration
or qualification, except where the failure so to register or to
qualify does not have a material, adverse effect on the condition
(financial or other), general affairs, business, properties, net
assets or results of operations of the Fund. The Fund has no
subsidiaries.
(e) There are no legal or governmental proceedings pending or, to
the knowledge of the Fund, threatened, against the Fund, or to which
the Fund or any of its properties is subject, that are required to be
described in the Registration Statement or the Prospectus (and any
amendment or supplement to either of them) but are not described as
required and there are no agreements, contracts, indentures, leases or
other instruments that are required to be described in the
Registration Statement or the Prospectus (or any amendment or
supplement to either of them) or to be filed as an exhibit to the
Registration Statement that are not described or filed as required by
the 1933 Act, the 1940 Act or the Rules and Regulations.
(f) The Fund is not in violation of its Articles of
Incorporation, By-Laws or other organizational documents or any law,
ordinance, administrative or governmental rule or regulation
applicable to the Fund or of any decree of the Commission, the NASD,
any state securities commission, any national securities exchange, any
arbitrator, any court or any other governmental, regulatory,
self-regulatory or administrative agency or any other agency or any
body or official having
14
jurisdiction over the Fund or in material breach or default in the
performance of any obligation, agreement or condition contained in any
bond, debenture, note or any other evidence of indebtedness or in any
agreement, indenture, lease or other instrument to which the Fund is a
party or by which it or any of its properties may be bound.
(g) Neither the issuance and sale of the Shares, the execution,
delivery or performance of this Agreement or any of the Fund
Agreements by the Fund, nor the consummation by the Fund of the
transactions contemplated hereby or thereby (i) requires any consent,
approval, authorization or order of or registration or filing with the
Commission, the NASD, any state securities commission, any national
securities exchange, any arbitrator, any court, regulatory, body,
administrative agency or other governmental body, agency or official
having jurisdiction over the Fund (except compliance with the
securities or Blue Sky laws of various jurisdictions which have been
or will be effected in accordance with this Agreement and except for
compliance with the filing requirements of the NASD Division of
Corporate Finance) or conflicts or will conflict with or constitutes
or will constitute a breach of the Articles of Incorporation, By-Laws
or other organizational documents of the Fund or (ii) (A) conflicts or
will conflict with or constitutes or will constitute a material breach
of or a default under any agreement, indenture, lease or other
instrument to which the Fund is a party or by which it or any of its
properties may be bound or violates or (B) will violate any statute,
law, regulation or filing or judgment, injunction, order or decree
applicable to the Fund or any of its properties or will result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Fund pursuant to the terms of any agreement
or instrument to which it is a party or by which it may be bound or to
which any of the property or assets of the Fund is subject. As of the
date hereof, the Fund is not subject to any order of any court or of
any arbitrator, governmental authority or administrative agency.
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(h) Since the date as of which information is given in the
Registration Statement and the Prospectus (and any amendment or
supplement to either of them), except as otherwise stated therein, (i)
there has been no material, adverse change in the condition (financial
or other), general affairs, business, properties, net assets or
results of operations of the Fund or business prospects (other than as
a result of a change in the financial markets generally) of the Fund,
whether or not arising in the ordinary course of business, (ii) there
have been no transactions entered into by the Fund other than those in
the ordinary course of its business as described in the Prospectus
(and any amendment or supplement thereto) and (iii) there has been no
dividend or distribution of any kind declared, paid or made by the
Fund on any class of its common stock.
(i) The accountants, Deloitte & Touche LLP who have audited or
shall audit the Statement of Assets and Liabilities included in the
Registration Statement and the Prospectus (and any amendment or
supplement to either of them), have advised the Fund and the Manager
that they are an independent public accounting firm as required by the
1933 Act, the 1940 Act and the Rules and Regulations.
(j) The financial statements, together with related schedules and
notes, included in the Registration Statement or the Prospectus (or
any amendment or supplement to either of them) present fairly the
financial position of the Fund on the basis stated in the Registration
Statement at the respective dates or for the respective periods to
which they apply; such statements and related schedules and notes have
been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved except
as disclosed therein; and the other financial and statistical
information and data included in the Registration Statement or the
Prospectus (or any amendment or supplement thereto) are accurately
derived from such financial statements and the books and records of
the Fund.
(k) The Fund, subject to the Registration Statement having been
declared effective and the filing of the
16
Prospectus under Rule 497 under the 1933 Act Rules and Regulations,
has taken all required action under the 1933 Act, the 1940 Act and the
Rules and Regulations to make the public offering and consummate the
sale of the Shares as contemplated by this Agreement.
(l) The execution and delivery of and the performance by the Fund
of its obligations under this Agreement and the Fund Agreements have
been duly and validly authorized by the Fund and this Agreement and
the Fund Agreements have been duly executed and delivered by the Fund
and each constitutes the valid and legally binding agreement of the
Fund, enforceable against the Fund in accordance with its terms,
except as rights to indemnity and contribution hereunder may be
limited by federal or state securities laws and subject to the
qualification that the enforceability of the Fund's obligations
hereunder and thereunder may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting
creditors' rights generally and by general equitable principles.
(m) Except as disclosed in or contemplated by the Registration
Statement or the Prospectus (or any amendment or supplement to either
of them), subsequent to the respective dates as of which such
information is given in the Registration Statement and the Prospectus
(and any amendment or supplement to either of them), the Fund has not
incurred any liability or obligation, direct or contingent or entered
into any transaction, not in the ordinary course of business, and
there has not been any change in the capital stock or material
increase in the short-term debt or long-term debt of the Fund or any
material, adverse change or any development involving or which should
reasonably be expected to involve a material, adverse change in the
condition (financial or other), general affairs, business, properties,
net assets or results of operations of the Fund or its capitalization,
or the incurrence of any debt by, the Fund.
(n) The Fund has not distributed and, prior to the later to occur
of (i) the Closing Date and (ii) completion of the distribution of the
Shares, will not
17
distribute to the public any offering material in connection with the
offering and sale of the Shares other than the Registration Statement,
the Prepricing Prospectus included in Pre-Effective Amendment No. ___
to the registration statement, the Prospectus and the sales material
filed with the NASD on March 31, 2000 [and other dates, if any], as
amended or supplemented.
(o) The Fund has such licenses, permits, and authorizations of
governmental or regulatory authorities ("permits") as are necessary to
own its property and to conduct its business in the manner described
in the Prospectus (and any amendment or supplement thereto); the Fund
has fulfilled and performed all its material obligations with respect
to such permits and no event has occurred which allows or, after
notice or lapse of time, would allow, revocation or termination
thereof or results in any other material impairment of the rights of
the Fund under any such permit, subject in each case to such
qualification as may be set forth in the Prospectus (and any amendment
or supplement thereto); and, except as described in the Prospectus
(and any amendment or supplement thereto), none of such permits
contains any restriction that is materially burdensome to the Fund.
(p) The Fund maintains and will maintain a system of internal
accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with the Board of
Directors' general or specific authorization and with the investment
policies and restrictions of the Fund and the applicable requirements
of the 1940 Act, the 1940 Act Rules and Regulations and the Code; (ii)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles, to calculate net asset value and fee accruals, to maintain
accountability for assets and to maintain material compliance with the
books and records requirements under the 1940 Act and the 1940 Act
Rules and Regulations; (iii) access to assets is permitted only in
accordance with the Board of Directors' general or specific
authorization; and (iv) the recorded account for assets is compared
with existing assets at
18
reasonable intervals and appropriate action is taken with respect to
any differences.
(q) The conduct by the Fund of its business (as described in the
Prospectus) does not require it to be the owner, possessor or licensee
of any patents, patent licenses, trademarks, service marks or trade
names which it does not own, possess or license.
(r) Except as stated in this Agreement and in the Prospectus (and
any amendment or supplement thereto), the Fund has not taken and will
not take, directly or indirectly, any action designed to or which
should reasonably be expected to cause or result in or which will
constitute stabilization or manipulation of the price of the Shares in
violation of federal securities laws and the Fund is not aware of any
such action taken or to be taken by any affiliates of the Fund.
(s) The Fund is duly registered under the 1940 Act and Rules and
Regulations as a closed-end, non-diversified management investment
company and the 1940 Act Notification has been duly filed with the
Commission and, at the time of filing thereof and at the time of
filing any amendment or supplement thereto, conformed in all material
respects with all applicable provisions of the 1940 Act and the Rules
and Regulations; no order of suspension or revocation of such
registration under the 1940 Act and the Rules and Regulations has been
issued or proceedings therefor initiated or threatened by the
Commission. The provisions of the Articles of Incorporation and
Bylaws, and the investment policies and restrictions described in each
of the Registration Statement and the Prospectus, comply in all
material respects with the requirements of the 1940 Act and the Rules
and Regulations.
(t) All advertising, sales literature or other promotional
material (including "prospectus wrappers" "broker kits," "road show
slides" and "road show scripts" authorized in writing by or prepared
by the Fund for use in connection with the offering and sale of the
Shares (collectively, "Fund sales material")) complied and comply in
all respects with the applicable requirements
19
of the 1933 Act, the 1933 Act Rules and Regulations and the rules and
interpretations of the NASD and, if required to be filed with the NASD
under the NASD's conduct rules, were so filed and no such Fund sales
material, when read together with the Prospectus, contained or
contains an untrue statement of a material fact or omitted or omits to
state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading.
(u) This Agreement and each of the Fund Agreements complies in
all material respects with all applicable provisions of the 1933 Act,
the 1940 Act, the Rules and Regulations, 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").
(v) No holder of any security of the Fund has any right to
require registration of any Shares, capital stock or any other
security of the Fund because of the filing of the registration
statement or consummation of the transactions contemplated by this
Agreement.
7. Representations and Warranties of the Manager. The Manager
represents and warrants to each Underwriter as follows:
(a) The Manager is a corporation duly organized and validly
existing in good standing 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 each of the
Registration Statement and the Prospectus (or any amendment or
supplement to either of them) and is duly registered and qualified to
conduct business and is in good standing in each jurisdiction or place
where the nature of its properties or conduct of its business requires
such registration or qualification, except where the failure so to
register or to qualify would not have a material, adverse affect on
the condition (financial or other), general affairs, business,
properties, net assets or results of operations of the Fund.
20
(b) The Manager is duly registered with the Commission as an
investment adviser under the Advisers Act and is not prohibited by the
Advisers Act, the 1940 Act, the Advisers Act Rules and Regulations or
the 1940 Act Rules and Regulations from acting under the Management
Agreement for the Fund as contemplated by the Registration Statement
or the Prospectus (or any amendment or supplement to either of them).
There does not exist any proceeding which could reasonably expected to
have a material adverse affect on the registration of the Manager with
the Commission.
(c) There are no legal or governmental proceedings pending or, to
the knowledge of the Manager, threatened against the Manager, that are
required to be described in the Registration Statement or the
Prospectus (or any amendment or supplement to either of them) but are
not described as required or that could reasonably be expected to
result in any material, adverse change in the condition (financial or
other), properties, net assets or results of operations of the Manager
or that may have a material, adverse effect on the ability of the
Manager to perform its obligations under this Agreement or the
Management Agreement.
(d) Neither the execution, delivery or performance of this
Agreement or the Management Agreement by the Manager, nor the
consummation by the Manager of the transactions contemplated hereby or
thereby (i) requires the Manager to obtain any consent, approval,
authorization or other order of, or registration or filing with, the
Commission, the NASD, any state securities commission, any national
securities exchange, any arbitrator, any court, regulatory body,
administrative agency or other governmental body, agency or official
having jurisdiction over the Manager or conflicts or will conflict
with or constitutes or will constitute a breach of or a default under,
the certificate of incorporation or bylaws, or other organizational
documents of the Manager or (ii) conflicts or will conflict with or
constitutes or will constitute a material breach of or a default
under, any material agreement, indenture, lease or other instrument to
which the Manager is a party or by which the Manager or any of
21
its properties may be bound, or materially violates or will materially
violate any material statute, law, regulation or judgment, injunction,
order or decree applicable to the Manager or any of its properties or
will result in the creation or imposition of any material lien, charge
or encumbrance upon any property or assets of the Manager pursuant to
the terms of any agreement or instrument to which it is a party or by
which it may be bound or to which any of the property or assets of the
Manager is subject, except in any case under clause (i) or (ii) as
should not reasonably be expected to have a material adverse effect on
the ability of the Manager to perform its obligations under this
Agreement and the Management Agreement. The Manager is not subject to
any order of any court or of any arbitrator, governmental authority or
administrative agency.
(e) The Manager has full power and authority to enter into this
Agreement and the Management Agreement, the execution and delivery of,
and the performance by the Manager of its obligations under, this
Agreement and the Management Agreement have been duly and validly
authorized by the Manager and this Agreement and the Management
Agreement have been duly executed and delivered by the Manager and
constitute the valid and legally binding agreements of the Manager,
enforceable against the Manager in accordance with their terms, except
as rights to indemnity and contribution hereunder may be limited by
federal or state securities laws and subject to the qualification that
the enforceability of the Manager's obligations hereunder and
thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium and other laws relating to or
affecting creditors' rights generally and by general equitable
principles whether enforcement is considered in a proceeding in equity
or at law.
(f) The Manager and Xxxxxxxx Advisors each have the financial
resources necessary for the performance of their services and
obligations as contemplated in the Registration Statement or the
Prospectus (or any amendment or supplement to either of them) or under
this Agreement or the Management Agreement.
22
(g) The description of the Manager and its business, and the
statements attributable to the Manager, in the Registration Statement
or the Prospectus (or 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 did not and
will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein (in the case of the Prospectus, in light
of the circumstances under which they were made) not misleading.
(h) Since the date as of which information is given in the
Registration Statement or the Prospectus (or any amendment or
supplement to either of them), except as otherwise stated therein, (i)
there has been no material adverse change in the condition (financial
or other), business, properties, net assets or results of operations
or business prospects of the Manager, whether or not arising from the
ordinary course of business and (ii) there have been no transactions
entered into by the Manager which are material to the Manager other
than those in the ordinary course of its business as described in the
Prospectus.
(i) The Manager has such licenses, permits and authorizations of
governmental or regulatory authorities ("permits") as are necessary to
own its property and to conduct its business in the manner described
in the Prospectus (and any amendment or supplement thereto); the
Manager has fulfilled and performed all its material obligations with
respect to such permits and no event has occurred which allows, or
after notice or lapse of time would allow, revocation or termination
thereof or results in any other material impairment of the rights of
the Manager under any such permit.
(j) This Agreement and the Management Agreement each comply in
all material respects with all applicable provisions of the 1940 Act,
the 1940 Act Rules and Regulations, the Advisers Act and the Advisers
Act Rules and Regulations.
23
(k) Except as stated in this Agreement, the Registration
Statement or the Prospectus (or in any amendment or supplement to any
of the foregoing), the Manager has not taken and will not take,
directly or indirectly, any action designed to or which might
reasonably be expected to cause or result in or which will constitute
stabilization or manipulation of the price of the Shares or of any
securities issued by the Fund to facilitate the sale or resale of the
Shares, in each case, in violation of federal securities laws and the
Manager is not aware of any such action taken or to be taken by any
affiliates of the Manager.
(l) In the event that the Fund or the Manager makes available any
promotional materials intended for use only by qualified
broker-dealers and registered representatives thereof by means of an
Internet web site or similar electronic means, the Manager will
install and maintain pre-qualification and password-protection or
similar procedures which are reasonably designed to effectively
prohibit access to such promotional materials by persons other than
qualified broker-dealers and registered representatives thereof.
(m) All advertising, sales literature or other promotional
material (including "prospectus wrappers," "broker kits," "road show
slides," and "road show scripts" authorized in writing by or prepared
by or for the Fund or the Manager for use in connection with the
offering and sale of the Shares (collectively, "sales material"))
complied and comply in all respects with the applicable requirements
of the 1933 Act, the 1933 Act Rules and Regulations and the rules and
interpretations of the NASD and, if required to be filed with the NASD
under the NASD's conduct rules, were so filed, and no such sales
material, when read together with the Prospectus, contained or
contains an untrue statement of a material fact or omitted or omits to
state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading.
24
8. Indemnification and Contribution.
(a) The Fund and the Manager, jointly and severally, agree to
indemnify and hold harmless each of you and each other Underwriter and
each person, if any, who controls any Underwriter within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act, from and
against any and all losses, claims, damages, liabilities and expenses,
joint or several (including reasonable costs of investigation),
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement,
the Prospectus, any Prepricing Prospectus or any sales material (or
any amendment or supplement to any of the foregoing) or arising out of
or based upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein (in the case of a prospectus, in light of the
circumstances under which they were made) not misleading, except
insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged
untrue statement or omission which has been made therein or omitted
therefrom in reliance upon and in conformity with the information
relating to such Underwriters furnished in writing to the Fund by or
on behalf of any Underwriter through you expressly for use in
connection therewith; provided, however, that the foregoing
indemnification contained in this paragraph (a) with respect to the
Prepricing Prospectus contained in Pre-Effective Amendment No. 3 to
the registration statement shall not inure to the benefit of any
Underwriter (or to the benefit of any person controlling such
Underwriter) on account of any such loss, claim, damage, liability or
expense arising from the sale of the Shares by such Underwriter to any
person if it is shown that a copy of the Prospectus was not delivered
or sent to such person within the time required by the 1933 Act and
the 1933 Act Rules and Regulations and the untrue statement or alleged
untrue statement or omission or alleged omission of a material fact
contained in such Prepricing Prospectus was corrected in the
Prospectus, provided that the Fund has delivered the Prospectus to the
several Underwriters in requisite quantity on a
25
timely basis to permit proper delivery or sending. The foregoing
indemnity agreement shall be in addition to any liability which the
Fund or the Manager may otherwise have.
(b) If any action, suit or proceeding shall be brought against
any Underwriter or any person controlling any Underwriter in respect
of which indemnity may be sought against the Fund or the Manager, such
Underwriter or such controlling person shall promptly notify the Fund
or the Manager and the Fund or the Manager shall assume the defense
thereof, including the employment of counsel and the payment of all
fees and expenses. Such Underwriter or any such controlling person
shall have the right to employ separate counsel in any such action,
suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such
Underwriter or controlling person unless (i) the Fund or the Manager
have agreed in writing to pay such fees and expenses, (ii) the Fund
and the Manager have failed within a reasonable time to assume the
defense and employ counsel or (iii) the named parties to any such
action, suit or proceeding (including any impleaded parties) include
both such Underwriter or such controlling person and the Fund or the
Manager and such Underwriter or such controlling person shall have
been advised by its counsel that representation of such indemnified
party and the Fund or the Manager by the same counsel would be
inappropriate under applicable standards of professional conduct
(whether or not such representation by the same counsel has been
proposed) due to actual or potential differing interests between them
(in which case the Fund and the Manager shall not have the right to
assume the defense of such action, suit or proceeding on behalf of
such Underwriter or such controlling person). It is understood,
however, that the Fund and the Manager shall, in connection with any
one such action, suit or proceeding or separate but substantially
similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only
one separate firm of attorneys (in addition to any local counsel if
there is any action, suit or proceeding in more than one
26
jurisdiction) at any time for all such Underwriters and controlling
persons not having actual or potential differing interests with you or
among themselves, which firm shall be designated in writing by Xxxxxxx
Xxxxx Barney Inc. and that, subject to the requirements of 1940 Act
Release No. 11330, all such fees and expenses shall be reimbursed
promptly as they are incurred. The Fund and the Manager shall not be
liable for any settlement of any such action, suit or proceeding
effected without the written consent of the Fund or the Manager, but
if settled with such written consent or if there be a final judgment
for the plaintiff in any such action, suit or proceeding, the Fund and
the Manager agree to indemnify and hold harmless any Underwriter, to
the extent provided in the preceding paragraph and any such
controlling person from and against any loss, liability, damage or
expense by reason by such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Fund and the Manager, their directors,
any officers of the Fund who sign the Registration Statement and any
person who controls the Fund or the Manager within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act, to the same
extent as the foregoing indemnity from the Fund and the Manager to
each Underwriter, but only with respect to information relating to
such Underwriter furnished in writing by or on behalf of such
Underwriter through you expressly for use in the Registration
Statement or the Prospectus (or any amendment or supplement thereto).
If any action, suit or proceeding shall be brought against the Fund or
the Manager, any of their directors, any such officer or any such
controlling person, based on the Registration Statement or the
Prospectus (or any amendment or supplement to either of them) and in
respect of which indemnity may be sought against any Underwriter
pursuant to this paragraph (c), such Underwriter shall have the rights
and duties given to each of the Fund and the Manager by paragraph (b)
above (except that if the Fund or the Manager shall have assumed the
defense thereof such Underwriter shall not be required to do so, but
may employ separate counsel therein and participate in the defense
thereof, but the fees and expenses of such counsel shall be at such
27
Underwriter's expense) and the Fund and the Manager, their directors,
any such officer and any such controlling person shall have the rights
and duties given to the Underwriters by paragraph (b) above. The
foregoing indemnity agreement shall be in addition to any liability
which the Underwriters may otherwise have.
(d) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof
in respect of any losses, claims, damages, liabilities or expenses
referred to therein, then an indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the Fund and
the Manager on the one hand (treated jointly for this purpose as one
person) and the Underwriters on the other from the offering of the
Shares or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above
but also the relative fault of the Fund and the Manager on the one
hand (treated jointly for this purpose as one person) and of the
Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities
or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Fund and the Manager on the one
hand (treated jointly for this purpose as one person) and the
Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting
expenses) received by the Fund bear to the total underwriting
discounts and commissions received by the Underwriters, in each case,
as set forth in the table on the cover page of the Prospectus. The
relative fault of the Fund and the Manager on the one hand (treated
jointly for this purpose as one person) and of the Underwriters on the
other shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact
28
relates to information supplied by the Fund and the Manager on the one
hand (treated jointly for this purpose as one person) or by the
Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission.
(e) The Fund, the Manager and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this
Section 8 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any
other method of allocation that does not take account of the equitable
considerations referred to in paragraph (d) above. The amount paid or
payable by an indemnified party as a result of the losses, claims,
damages, liabilities and expenses referred to in paragraph (d) above
shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating any claim or
defending any such action, suit or proceeding. Notwithstanding the
provisions of this Section 8, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price
of the Shares underwritten by it and distributed to the public exceeds
the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement
or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 0000
Xxx) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters'
obligations to contribute pursuant to this Section 8 are several in
proportion to the respective number of Shares set forth opposite their
names in Schedule I (as the same may be adjusted pursuant to this
Agreement) and not joint.
(f) No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending
or threatened action, suit or proceeding in respect of which any
indemnified party is or could have been a party and indemnity could
have been
29
sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all
liability from claimants on claims that are the subject matter of such
action, suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or
contribution under this Section 8 shall be paid by the indemnifying
party to the indemnified party as such losses, claims, damages,
liabilities or expenses are incurred. The indemnity and contribution
agreements contained in this Section 8 and the representations and
warranties of the Fund and the Manager set forth in this Agreement
shall remain operative and in full force and effect, regardless of (i)
any investigation made by or on behalf of any Underwriter or any
person controlling any Underwriter, the Fund, the Manager or their
directors or officers or any person controlling the Fund or the
Manager, (ii) acceptance of any Shares and payment therefor hereunder
and (iii) any termination of this Agreement. A successor to any
Underwriter or to the Fund, the Manager or their directors or officers
or any person controlling the Fund or the Manager shall be entitled to
the benefits of the indemnity, contribution and reimbursement
agreements contained in this Section 8.
9. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase any Shares hereunder are subject to, in the good
faith judgment of the Underwriters, the accuracy of and compliance with the
representations, warranties and agreements of and by the Fund and the Manager
contained herein on and as of the Execution Date, the date on which the
Registration Statement becomes or became effective, the date of the Prospectus
(and of any amendment or supplement thereto) and the Closing Date; to the
accuracy and completeness of all statements made by the Fund, the Manager or any
of their officers in any certificate delivered to the Representatives or their
counsel pursuant to this Agreement, and to the following conditions:
(a) If, at the time this Agreement is executed and delivered,
it is necessary for the Registration Statement
30
or a post-effective amendment thereto to be declared effective before
the offering of the Shares may commence, the Registration Statement or
such post-effective amendment shall have become effective not later
than 5:30 p.m., New York City time, on the date hereof or at such
later date and time as shall be consented to in writing by you and all
filings, if any, required by Rules 497 and 430A under the 1933 Act and
the 1933 Act Rules and Regulations shall have been timely made; no
stop order suspending the effectiveness of the Registration Statement
or order pursuant to Section 8(e) of the 1940 Act shall have been
issued and no proceeding for that purpose shall have been instituted
or, to the knowledge of the Fund, the Manager or any Underwriter,
threatened by the Commission and any request of the Commission for
additional information (to be included in the Registration Statement
or the Prospectus or otherwise) shall have been complied with to your
satisfaction.
(b) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any change or any development involving a
prospective change in or affecting the condition (financial or other),
business, general affairs, properties, net assets, or results of
operations of the Fund or the Manager not contemplated by the
Prospectus, which in your opinion, would materially adversely affect
the market for the Shares, or (ii) any event or development relating
to or involving the Fund or the Manager or any officer or director of
the Fund or the Manager which makes any statement made in the
Prospectus untrue or which, in the opinion of the Fund and its counsel
or the Underwriters and their counsel, requires the making of any
addition to or change in the Prospectus in order to state a material
fact required by the 1933 Act, the 1940 Act or the Rules and
Regulations or any other law to be stated therein or necessary in
order to make the statements therein not misleading, if amending or
supplementing the Prospectus to reflect such event or development
would, in your opinion, materially adversely affect the market for the
Shares.
(c) That you shall have received on each of the Execution Date
and the Closing Date opinions of Xxxxxxxx & Xxxxxxxx, special counsel
for the Fund, dated the
32
Execution Date and the Closing Date, respectively, and addressed to
you, as Representatives of the several Underwriters in substantially
the form attached hereto as Exhibit A.
(d) That you shall have received on each of the Execution Date
and the Closing Date opinions of Xxxxx X. Xxxxx, Senior Vice
President, General Counsel and Secretary for the Manager, dated the
Execution Date and the Closing Date, respectively, and addressed to
you, as Representatives of the several Underwriters in substantially
the form attached hereto as Exhibit B.
(e) That you shall have received on each of the Execution Date
and the Closing Date opinions of Skadden, Arps, Slate, Xxxxxxx & Xxxx
LLP, dated the Execution Date and the Closing Date, respectively, and
addressed to you, with respect to such matters as you may require and
the Fund, the Manager and their respective counsel shall have
furnished to such counsel such documents as they may request for the
purpose of enabling them to pass upon such matters.
(f) That you shall have received on each of the Execution Date
and the Closing Date letters addressed to you, as Representatives of
the several Underwriters and dated each of the Execution Date and the
Closing Date, respectively, from Deloitte & Touche LLP, independent
certified public accountants, substantially in the forms heretofore
approved by you.
(g) (i) No order suspending the effectiveness of the registration
statement or the Registration Statement or prohibiting or suspending
the use of the Prospectus (or any amendment or supplement to any of
the foregoing) or any Prepricing Prospectus or any sales material
shall have been issued and no proceedings for such purpose or for the
purpose of commencing an enforcement action against the Fund, the
Manager or, with respect to the transactions contemplated by the
Prospectus (or any amendment or supplement thereto) and this Agreement
may be pending before or, to the knowledge of the Fund, the Manager or
any Underwriter or in the reasonable view of counsel to the
Underwriters, shall be threatened or
32
contemplated by the Commission at or prior to the Closing Date and
that any request for additional information on the part of the
Commission (to be included in the Registration Statement, the
Prospectus or otherwise) be complied with to the satisfaction of the
Representatives, (ii) there shall not have been any change in the
capital stock of the Fund nor any material increase in debt of the
Fund from that set forth in the Registration Statement or the
Prospectus (or any amendment or supplement to either of them) and the
Fund shall not have sustained any material liabilities or obligations,
direct or contingent, other than those reflected in the Prospectus (or
any amendment or supplement thereto); (iii) since the date of the
Prospectus there shall not have been any material, adverse change in
the condition (financial or other), general affairs, business,
prospects, properties, net assets or results of operations of the Fund
or the Manager; (iv) the Fund or the Manager must not have sustained
any material loss or interference with their businesses from any court
or from legislative or other governmental action, order or decree or
from any other occurrence not described in the Registration Statement
or the Prospectus (or any amendment or supplement to either of them);
and (v) all of the representations and warranties of the Fund and the
Manager contained in this Agreement shall be true and correct on and
as of the Execution Date and as of the Closing Date as if made on and
as of the Execution Date.
(h) That none of the Fund, the Manager or Xxxxxxxx Advisors shall
have failed at or prior to the Execution Date or the Closing Date to
have performed or complied with any of the agreements herein contained
and required to be performed or complied with by them at or prior to
the Execution Date or the Closing Date.
(i) That you shall have received on the Execution Date a
certificate, dated such date, of each of the chief executive officer
and chief financial officer of each of the Fund and the Manager
certifying that (i) the signers have carefully examined the
Registration Statement, the Prospectus (and any amendments or
supplements to either of them) and this Agreement, (ii) the
representations and warranties of the Fund (with respect to the
certificates
33
from such Fund officers) and the representations of the Manager (with
respect to the certificates from such officers of the Manager) in this
Agreement are true and correct on and as of the date of the
certificate as if made on such date, (iii) since the date of the
Prospectus (and any amendment or supplement thereto) there has not
been any material, adverse change in the condition (financial or
other), business, prospects (other than as a result of a change in the
financial markets generally), properties, net assets or results of
operations of the Fund (with respect to the certificates from such
Fund officers) or the Manager (with respect to the certificates from
such officers of the Manager), (iv) to the knowledge of such officers
after reasonable investigation, no order suspending the effectiveness
of the Registration Statement or prohibiting the sale of any of the
Shares or having a material, adverse effect on the Fund (with respect
to the certificates from such Fund officers) or the Manager (with
respect to the certificates from such officers of the Manager) has
been issued and no proceedings for any such purpose are pending before
or threatened by the Commission or any court or other regulatory body,
the NASD, any state securities commission, any national securities
exchange, any arbitrator, any court or any other governmental,
regulatory, self-regulatory or administrative agency or any official,
(v) each of the Fund (with respect to certificates from such Fund
officers) and the Manager (with respect to certificates from such
officers of the Manager) has performed and complied with all
agreements that this Agreement require it to perform by such Closing
Date, (vi) neither the Fund (with respect to the certificate from such
officers of the Fund) nor the Manager (with respect to the certificate
from such officers of the Manager) has sustained any material loss or
interference with its business from any court or from legislative or
other governmental action order or decree or from any other occurrence
not described in the Registration Statement and the Prospectus and any
amendment or supplement to either of them and (vii) with respect to
the certificate from such officers of the Fund, there has not been any
change in the capital stock of the Fund nor any material increase in
the debt of the Fund from that set forth in the Prospectus (or any
34
amendment or supplement thereto) and the Fund has not sustained any
material liabilities or obligations, direct or contingent, other than
those reflected in the Prospectus (or any amendment or supplement
thereto).
(j) That you shall receive on the Closing Date a certificate,
dated such date, of each of the chief executive officer and chief
financial officer of each of the Fund and Manager certifying that the
certifications provided in paragraph (i) above remain true as of such
date.
(k) That the Fund and the Manager shall have furnished to you
such further certificates, documents and opinions of counsel as you
shall reasonably request (including certificates of officers of the
Fund and the Manager).
All such opinions, certificates, letters and other documents will
be in compliance with the provisions hereof only if they are
satisfactory in form and substance to you and your counsel acting in
good faith.
Any certificate or document signed by any officer of the Fund or
the Manager and delivered to you, as Representatives of the
Underwriters or to Underwriters' counsel, shall be deemed a
representation and warranty by the Fund or the Manager to each
Underwriter as to the statements made therein.
10. Effective Date of Agreement. This Agreement shall become effective:
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for the
Registration Statement or a post-effective amendment thereto to be declared
effective before the offering of the Shares may commence, when the Registration
Statement or such post- effective amendment has become effective. Until such
time as this Agreement shall have become effective, it may be terminated by the
Fund by notifying you, or by you by notifying the Fund.
If any Underwriter or Underwriters shall fail or refuse to purchase
Shares which it or they are obligated to purchase
35
hereunder on the Closing Date, and arrangements satisfactory to you and the Fund
for the purchase of such Shares by one or more non-defaulting Underwriters or
other party or parties approved by you and the Fund are not made within 36 hours
after such default, no Underwriter will be under any obligation to purchase any
Shares that were to be purchased but were not purchased by any other Underwriter
and, subject to the consent of the Underwriters, the Fund shall have the right
to postpone the Closing Date, but in no event for longer than seven days, in
order that required changes, if any, in the Registration Statement and the
Prospectus or any other documents or arrangements may be amended to reflect any
reduction in aggregate Shares to be offered and the Underwriters in this
Agreement and the Prospectus and any other required changes to this Agreement,
the Prospectus or any other document. Any action taken under this paragraph
shall not relieve any defaulting Underwriter from liability in respect to any
such default of any such Underwriter under this Agreement. The Fund may
terminate this Agreement and have no obligation to sell any Shares to the
Underwriters if the total number of Shares to be purchased by the Underwriters
on the Closing Date is less than two-thirds of the total shown on Schedule I.
The term "Underwriter" as used in this Agreement includes, for all purposes of
this Agreement, any party not listed in Schedule I hereto who, with your
approval and the approval of the Fund, purchases Shares which a defaulting
Underwriter is obligated to purchase. Any Shares that the Fund determined not to
sell to an Underwriter pursuant to the proviso contained in Section 2 hereof
shall not be considered Shares that any Underwriter is obligated, but fails or
refuses, to purchase.
Any notice under this Section 10 may be made by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
11. Termination of Agreement.
(a) This Agreement shall be subject to termination in your
absolute discretion, without liability on the part of any Underwriter
to the Fund or the Manager by notice to the Fund or the Manager if
prior to the Closing Date (i) trading in securities generally on the
New York Stock Exchange, American Stock Exchange, Nasdaq National
36
Market, Nasdaq SmallCap Market or the Nasdaq Stock Market shall have
been suspended or limited or minimum prices shall have been
established (ii) additional governmental restrictions not in force on
the date of this Agreement have been imposed upon trading in
securities generally [(except for any governmental restrictions
already adopted with delayed effective dates)] or a general moratorium
on commercial banking activities shall have been declared by Federal
or any state authorities or (iii) any outbreak or material escalation
of hostilities or other international or domestic calamity, crisis or
change in political, financial, economic, legal or regulatory
conditions, occurs, the effect of which is such as to make it, in your
judgment, impracticable or inadvisable to commence or continue the
offering of the Shares at the offering prices to the public set forth
on the cover page of the Prospectus. Notice of such termination may be
given to the Fund or the Manager by telegram, telecopy or telephone
but shall be subsequently confirmed by letter.
(b) In the event of termination of this Agreement in accordance
with the foregoing clause (a), (i) the Fund agrees to immediately
reimburse each Underwriter on the Closing Date (or such other date
that NSCC settles the purchase and sale of the Shares) the dollar
amount previously paid to the Fund by such Underwriter by wire
transfer to the order of such Underwriter and (ii) each Underwriter
agrees not to sell any Shares to its customers.
12. Expenses. The Fund agrees to pay the following costs and expenses
and all other costs and expenses incident to the performance by the Fund of its
obligations hereunder: (a) the preparation, printing or reproduction, filing
(including, without limitation, the filing fees prescribed by the 1933 Act, the
1940 Act and the Rules and Regulations) and distribution of the Registration
Statement (including exhibits thereto), the Prospectus, each Prepricing
Prospectus and the 1940 Act Notification and all amendments or supplements to
any of them, (b) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such copies of
the Registration Statement, the Prospectus, each Prepricing Prospectus, any
37
sales material (and all amendments or supplements to any of them) as may be
reasonably requested for use in connection with the offering and sale of the
Shares, (c) the preparation, printing, authentication, issuance and delivery of
certificates (if any) for the Shares, including any stamp taxes and transfer
agent and registrar fees payable in connection with the original issuance and
sale of such Shares, (d) the registrations or qualifications of the Shares for
offer and sale under the securities or Blue Sky laws of the several states as
provided in Section 5(g) hereof (including the reasonable fees, expenses and
disbursements of counsel for the Underwriters relating to the preparation,
printing or reproduction and delivery of the preliminary and supplemental Blue
Sky Memoranda and such registration and qualification), (e) the fees and
expenses of the Fund's independent accountants, counsel for the Fund and of the
transfer agent, (f) the expenses of delivery to the Underwriters and dealers
(including postage, air freight and the cost of counting and packaging) of
copies of the Prospectus, the Prepricing Prospectus, any sales material and all
amendments or supplements to the Prospectus as may be requested for use in
connection with the offering and sale of the Shares, (g) the printing (or
reproduction) and delivery of this Agreement, any dealer agreements, the
preliminary and supplemental Blue Sky Memoranda and all other company-authorized
agreements or other documents printed (or reproduced) and delivered in
connection with the offering of the Shares, and (h) the filing fees and the fees
and expenses of counsel for the Underwriters in connection with any filings
required to be made with the NASD and incurred with respect to the review of the
offering of the Shares by the NASD.
Notwithstanding the foregoing, in the event that the sale of the Shares
is not consummated pursuant to Section 2 hereof, the Manager will pay the costs
and expenses of the Fund set forth above in this Section 12, and reimbursements
of Underwriter expenses in connection with the offering shall be made in
accordance with Section 5(l) hereof.
13. Information Furnished by the Underwriters. The statements set forth
in the first paragraph and the eleventh paragraph under the caption
"Underwriting" in the Prospectus constitute the only information relating to any
Underwriter furnished to the Fund in writing by or on behalf of the
38
Underwriters through you as such information is referred to herein, expressly
for use in the Prospectus.
14. Miscellaneous. Except as otherwise provided in Sections 5, 10 and
11 hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (a) if to the Fund or the Manager, c/o J.& X.
Xxxxxxxx & Co. Incorporated at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx, Esq., (b) if to you, as Representatives of the
Underwriters, at the office of Xxxxxxx Xxxxx Xxxxxx Inc. at 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Counsel, with a copy to Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP, Xxx Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000,
Attention: Xxxxxx X. XxXxxx, Esq.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Fund, the Manager, their directors and officers and
the other controlling persons referred to in Section 8 hereof and their
respective successors and assigns, to the extent provided herein and no other
person shall acquire or have any right under or by virtue of this Agreement.
Neither the term "successor" or the term "successors and assigns" as used in
this Agreement shall include a purchaser from any Underwriter of any of the
Shares in his status as such purchaser.
15. Applicable Law; Counterparts. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
39
Please confirm that the foregoing correctly sets forth the agreement
among the Fund, the Manager and Xxxxxxxx Advisors and the several Underwriters.
Very truly yours,
XXXXXXXX NEW TECHNOLOGIES
FUND II, INC.
By:
-------------------------
Title:
J.& X. XXXXXXXX & CO.
INCORPORATED
By:
-------------------------
Title:
XXXXXXXX ADVISORS, INC.
By:
-------------------------
Title:
40
Confirmed as of the date first above written on behalf of
themselves and the other several Underwriters named in
Schedule I hereto.
By: XXXXXXX XXXXX XXXXXX INC.
By:
---------------------
Title: Director
AS REPRESENTATIVES OF THE SEVERAL UNDERWRITERS
By: XXXXXXX XXXXX BARNEY INC.
By:
---------------------
Title: Director
By: PAINEWEBBER INCORPORATED
By:
---------------------
Title: Director
41
SCHEDULE I
NUMBER
NAME OF UNDERWRITER OF SHARES
Xxxxxxx Xxxxx Xxxxxx Inc...........................................
PaineWebber Incorporated ..........................................
Advest, Inc........................................................
CIBC World Markets Corp............................................
X.X. Xxxxxxx & Sons, Inc. .........................................
McDonald Investments Inc., A KeyCorp. Company .....................
Xxxxxxx Xxxxx & Associates, Inc....................................
42
