[____________] MONEY MARKET CUMULATIVE PREFERRED(R) (MMP) SHARES
FIRST TRUST/FOUR CORNERS
SENIOR FLOATING RATE INCOME FUND
(Liquidation Preference $25,000 per Share)
UNDERWRITING AGREEMENT
November __, 2003
XXXXXX BROTHERS INC.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
First Trust/Four Corners Senior Floating Rate Income Fund, a
Massachusetts business trust (the "Fund"), proposes to, subject to the terms and
conditions stated herein, issue and sell to Xxxxxx Brothers Inc. (the
"Underwriter") _____ shares of its Money Market Cumulative Preferred(R) Shares,
par value $0.01 per share, with a liquidation preference of $25,000 per share
(the "MMP Shares"). The Fund, the Fund's investment adviser, First Trust
Advisors L.P., an Illinois limited partnership (the "Investment Adviser" or
"First Trust"), and the Fund's Subadviser, Four Corners Capital Management, LLC,
a Delaware limited liability company (the "Subadviser," and together with the
Investment Adviser, the "Advisers"), each wishes to confirm its agreement
concerning the purchase of the MMP Shares from the Fund by the Underwriter.
The Fund has entered into an Investment Management Agreement with the
Investment Adviser dated September 25, 2003 (the "Management Agreement"), a
Custodian Services Agreement with PFPC Trust Company ("PFPC") dated September
25, 2003 (the "Custodian Agreement"), a Transfer Agency Services Agreement with
PFPC, Inc. dated September 25, 2003 (the "Transfer Agency Agreement"), an
Administration and Accounting Services Agreement with PFPC, Inc. dated September
25, 2003 (the "Administration Agreement") and an Auction Agency Agreement,
including the form of Broker-Dealer Agreement, with Deutsche Bank Trust Company
Americas dated November __, 2003 (the "Auction Agreement"). Collectively, the
Management Agreement, the Custodian Agreement, the Transfer Agency Agreement,
the Administration Agreement and the Auction Agreement are referred to herein as
the "Fund Agreements." The Investment Adviser has entered into a Sub-Advisory
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Agreement with the Subadviser dated September 25, 2003 (the "Sub-Advisory
Agreement"). This Underwriting Agreement is herein referred to as the
"Agreement."
Section 1. Representations, Warranties and Agreements of the Fund and
the Advisers. The Fund and the Investment Advisers jointly and severally
represent, warrant and agree with respect to Section 1, and the Fund and the
Advisers jointly and severally represent, warrant and agree, with respect to
Sections 1(a), (b), (c), (g), (h), (k), (l), (o), (p), (q), (r), (s), (t), (x),
(y), (aa) (bb) and (cc), and, the Sub-Adviser severally represents, warrants and
agrees, as to itself with respect to Sections 1(e), (i), (u), (v), (w) and (y),
that:
(a) A registration statement on Form N-2 (Files No. 333-109680 and
811-21344) as amended by Pre-Effective Amendment No. 1 (Files No. 333-109680 and
811-21344) with respect to the MMP Shares has (i) been prepared by the Fund in
conformity with the requirements of the Securities Act of 1933, as amended (the
"Securities Act"), the Investment Company Act of 1940, as amended (the "1940
Act"), and the rules and regulations of the United States Securities and
Exchange Commission (the "Commission") promulgated under the Securities 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"), (ii) been filed with the Commission under the Securities Act
and the 1940 Act and (iii) become effective under the Securities Act. If any
post-effective amendment to such registration statement has been filed with the
Commission prior to execution and delivery of this Agreement, the most recent
such amendment has been declared effective by the Commission. Copies of such
registration statement and each of the amendments thereto have been delivered by
the Fund to you. As used in this Agreement, "Effective Time" means the date and
the time as of which such registration statement, or the most recent
post-effective amendment thereto, if any, was declared effective by the
Commission; "Effective Date" means the date of the Effective Time; "Preliminary
Prospectus" means each prospectus and related statement of additional
information included in such registration statement, or amendments thereof,
before it became effective under the Securities Act and any prospectus filed
with the Commission by the Fund with your consent pursuant to Rule 497(a) of the
1933 Act Rules and Regulations; "Registration Statement" means such registration
statement, as amended at the Effective Time, including all information contained
in the final prospectus (including the statement of additional information)
filed with the Commission pursuant to Rule 497 of the 1933 Act Rules and
Regulations and deemed to be a part of the registration statement as of the
Effective Time pursuant to Rule 430A of the Rules and Regulations; and
"Prospectus" means the prospectus and the statement of additional information
filed with the Commission pursuant to Rule 497(h) of the Securities Act. If the
Fund has filed a registration statement to register additional MMP Shares
pursuant to Rule 462(b) under the Securities Act (the "Rule 462 Registration
Statement"), then any reference herein to the term "Registration Statement"
shall be deemed to include such Rule 462 Registration Statement. The Commission
has not issued any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus.
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(b) A notification of registration of the Fund as an investment company
under the 1940 Act on Form N-8A (the "1940 Act Notification") has been prepared
by the Fund in conformity with the 1940 Act and has been filed with the
Commission. The Fund has not received any notice from the Commission with
respect to the Notification.
(c) The Registration Statement and the 1940 Act Notification conform,
and the Prospectus and any further amendments or supplements to the Registration
Statement or the Prospectus will, when they become effective or are filed with
the Commission, as the case may be, conform in all respects to the requirements
of the Securities Act, the 1940 Act and the Rules and Regulations and do not and
will not, as of the applicable effective date (as to the Registration Statement
and any amendment thereto) and as of the applicable filing date (as to the
Prospectus and the 1940 Act Notification and any amendment or supplement
thereto) contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; provided that no representation or warranty is made as
to information contained in or omitted from the Registration Statement, the 1940
Act Notification or the Prospectus in reliance upon and in conformity with
written information furnished to the Fund through you or on your behalf
specifically for inclusion therein.
(d) The Fund has been duly formed and is validly existing as a business
trust in good standing under the laws of the Commonwealth of Massachusetts, is
duly registered and qualified to do business and is in good standing in each
jurisdiction in which its ownership or lease of property or the conduct of its
business as described in the Registration Statement and the Prospectus (and any
amendment or supplement to either) requires such qualification, and has all
statutory trust power and authority necessary to own or hold property and to
conduct the business as described in the Registration Statement and the
Prospectus (and any amendment or supplement to either), except where the failure
to so qualify or to be in good standing would not reasonably be expected to have
a material adverse effect on the condition (financial or other), business,
prospects, management, shareholders' equity or results of operations of the Fund
(a "Material Adverse Effect"). The Fund has no subsidiaries.
(e) The Fund has an authorized capitalization as set forth in the
Registration Statement and the Prospectus. All of the issued shares of
beneficial interest of the Fund have been duly and validly authorized and
issued, are fully paid and (except as described in the Prospectus under "Certain
Provisions of the Declaration of Trust") non-assessable and conform to the
description thereof contained in the Registration Statement and the Prospectus
(and any amendment or supplement to either).
(f) The MMP Shares to be issued and sold by the Fund to the Underwriter
hereunder have been duly and validly authorized and, when issued and delivered
against payment therefor in accordance with this Agreement, will be duly and
validly issued, fully paid and (except as described in the Prospectus under
"Certain Provisions of the Declaration of Trust") non-assessable; and the MMP
Shares will conform to the description thereof contained in the Registration
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Statement and the Prospectus (and any amendment or supplement to either). Upon
payment for and delivery of the MMP Shares to be sold by the Fund pursuant to
this Agreement, the Underwriter will acquire good and valid title to the MMP
Shares, in each case free and clear of all liens, encumbrances, equities,
preemptive rights, subscription rights, or any other claim of any third party
and the MMP Shares will conform in all material respects to the description
thereof contained in the Registration Statement and the Prospectus.
(g) This Agreement, each of the Fund Agreements and the Sub-Advisory
Agreement have been duly authorized, executed and delivered by the Fund and
constitute valid and legally binding agreements of the Fund, enforceable against
the Fund 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 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.
(h) None of the execution, delivery and performance of this Agreement
by the Fund, the performance of the Fund Agreements or the Sub-Advisory
Agreement by the Fund or the consummation of the transactions contemplated
hereby and thereby (i) conflict with, result in the creation or imposition of
any lien, charge or encumbrance upon the assets of the Fund, or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Fund is a party or by which the Fund is
bound or to which any of the property or assets of the Fund is subject, (ii)
result in any violation of the provisions of the Declaration of Trust (the
"Declaration of Trust") or by-laws of the Fund or (iii) result in the violation
of any statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Fund or any of its properties or
assets, except in the case of clauses (i) and (iii), such conflicts, breaches or
violations that in the aggregate would not reasonably be expected to have a
Material Adverse Effect; and except for the registration of the MMP Shares under
the Securities Act and such consents, approvals, authorizations, registrations
or qualifications as may be required under the Securities Exchange Act of 1934,
as amended (the "Exchange Act") and applicable state securities laws in
connection with the purchase and distribution of the MMP Shares by the
Underwriter, no consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or body is required for
the execution, delivery and performance of this Agreement by the Fund, the
performance of the Fund Agreements or the Sub-Advisory Agreement by the Fund or
the consummation of the transactions contemplated hereby and thereby.
(i) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance of this Agreement by the Fund, the performance of the Fund
Agreements or the Sub-Advisory Agreement by the Fund or the consummation of the
transactions contemplated hereby or thereby, except such as have been obtained
and such as may be required under the Securities Act, the Exchange Act or the
1940 Act, or applicable state securities laws in connection with the purchase
and distribution of the MMP Shares by the Underwriter.
Page 4
(j) There are no contracts, agreements or understandings between the
Fund and any person granting such person the right to require the Fund to file a
registration statement under the Securities Act with respect to any securities
of the Fund owned or to be owned by such person or to require the Fund to
include such securities in the securities registered pursuant to the
Registration Statement or in any securities being registered pursuant to any
other registration statement filed by the Fund under the Securities Act. The
holders of the Fund's outstanding shares of beneficial interest are not entitled
to preemptive or other rights to subscribe for the Shares. There are no
outstanding options, warrants or other rights to purchase, agreements or other
obligations to issue, or rights to convert any obligations into or exchange any
securities for, shares of beneficial interest of or ownership interests in the
Fund.
(k) The Fund has not sustained, since the date of the latest audited
financial statements included in the Prospectus, any material loss or
interference with its business that has had, or could reasonably be expected to
have, a Material Adverse Effect, whether from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree; and, since such date, there has
not been any change in the shares of beneficial interest or long-term debt of
the Fund or any change, or any development involving a prospective change, in or
affecting the general affairs, management, consolidated financial position,
shareholders' equity, results of operations, business or prospects of the Fund
that has had or could reasonably be expected to have a Material Adverse Effect,
other than as set forth or contemplated in the Prospectus.
(l) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement or included in
the Prospectus present fairly the financial condition and results of operations
of the Fund, at the dates and for the periods indicated, and have been prepared
in conformity with generally accepted accounting principles applied on a
consistent basis throughout the periods involved.
(m) Xxxxxxxx & Touche LLP, who have certified the financial statements
of the Fund, whose report appears in the Prospectus and who have delivered the
letters referred to in Sections 8(g) and (h) hereof, have represented to the
Fund that they are independent public accountants as required by the Securities
Act, the 1940 Act and the Rules and Regulations.
(n) The Fund carries, or is covered by, insurance in such amounts and
covering such risks as is adequate for the conduct of its business and as is
customary for closed-end investment funds engaged in similar businesses.
(o) There are no legal or governmental proceedings pending to which the
Fund is a party or of which any property or assets of the Fund is the subject
which is reasonably likely to be determined adversely to the Fund and, if
determined adversely to the Fund, would be reasonably likely to have a Material
Adverse Effect; and to the best of the Fund's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by others.
Page 5
(p) There are no contracts or other documents which are required to be
described in the Registration Statement or the Prospectus or filed as exhibits
to the Registration Statement by the Securities Act, the 1940 Act or by the
Rules and Regulations which have not been described in the Registration
Statement or the Prospectus or filed as exhibits to the Registration Statement.
(q) No relationship, direct or indirect, exists between or among the
Fund on the one hand, and the trustees, officers, shareholders, suppliers or
service providers of the Fund on the other hand, which is required to be
described in the Registration Statement or the Prospectus which is not so
described.
(r) Since the date as of which information is given in the Registration
Statement and the Prospectus through the date hereof, and except as may
otherwise be disclosed in the Prospectus, the Fund has not (i) issued or granted
any securities other than the common shares of beneficial interest of the Fund,
(ii) incurred any liability or obligation, direct or contingent, other than
non-material liabilities and obligations which were incurred in the ordinary
course of business, (iii) entered into any transaction not in the ordinary
course of business or (iv) declared or paid any dividend on its common shares
of beneficial interest.
(s) The Fund (i) makes and keeps accurate books and records and (ii)
maintains internal accounting controls which provide reasonable assurance that
(A) transactions are executed in accordance with management's authorization and
with the investment policies and restrictions of the Fund and the applicable
requirements of the 1940 Act, the 1940 Act Rules and Regulations and the
Internal Revenue Code of 1986, as amended (the "Code"), (B) transactions are
recorded as necessary to permit preparation of its financial statements and to
maintain accountability for its assets, (C) access to its assets is permitted
only in accordance with management's authorization and (D) the reported
accountability for its assets is compared with existing assets at reasonable
intervals.
(t) The Fund is not (i) in violation of its Declaration of Trust or
by-laws, (ii) in default, and no event has occurred which, with notice or lapse
of time or both, would constitute such a default, in the due performance or
observance of any term, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which it is a party or by which it is bound or to which any of its properties or
assets is subject or (iii) in violation of any law, ordinance, governmental
rule, regulation or court decree to which it or its property or assets may be
subject or has failed to obtain any material license, permit, certificate,
franchise or other governmental authorization or permit necessary to the
ownership of its property or to the conduct of its business, except, in the case
of clauses (ii) and (iii), such defaults, events, violations or failures that in
the aggregate would not reasonably be expected to have a Material Adverse
Effect.
(u) Neither the Fund nor the Advisers, nor any trustee, director,
officer, agent, employee or other person associated with or acting on behalf of
the Fund or any of the Advisers, has used any funds of the Fund or the Advisers
for any unlawful contribution, gift, entertainment or other unlawful expense
Page 6
relating to political activity; made any direct or indirect unlawful payment to
any foreign or domestic government official or employee from any funds of the
Fund or the Advisers; violated or is in violation of any provision of the
Foreign Corrupt Practices Act of 1977; or made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment.
(v) Neither the Fund nor any employee or agent of the Fund nor any
Adviser has made any payment of funds of the Fund or the Advisers or received or
retained any funds, which payment, receipt or retention of funds is of a
character required to be disclosed in the Prospectus or the Registration
Statement which is not so disclosed.
(w) There are no contracts, agreements or understandings between the
Fund or any of the Advisers and any person that would give rise to a valid claim
against the Fund or any Underwriter for a brokerage commission, finder's fee or
other like payment in connection with this offering.
(x) The statistical, market-related and industry data included in the
Prospectus and the Registration Statement are based on or derived from sources
which the Fund believes to be reliable and accurate.
(y) The Fund, subject to the filing of the Prospectus under Rule 497
under the 1933 Act Rules and Regulations, has taken all required action under
the Securities Act, the 1940 Act and the Rules and Regulations to make the
public offering and consummate the sale of the MMP Shares as contemplated by
this Agreement.
(z) Except as stated in this Agreement and in the Prospectus (and any
amendment or supplement thereto), the Fund has not taken and shall not take,
directly or indirectly, any action designed to cause or result in, or which
constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of the MMP Shares to facilitate the
sale or resale of the MMP Shares.
(aa) The Fund is duly registered under the 1940 Act as a closed-end,
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 1940 Act Rules
and Regulations. The Fund is, and at all times through the completion of the
transactions contemplated hereby will be, in compliance in all material respects
with the terms and provisions of the 1940 Act and the Securities Act. No person
is serving or acting as an officer, director or investment adviser of the Fund
except in accordance with the provisions of the 1940 Act and the 1940 Act Rules
and Regulations and the Investment Advisers Act of 1940, as amended (the
"Advisers Act") and the rules and regulations adopted by the Commission under
the Advisers Act (the "Adviser's Act Rules and Regulations"). The Fund has not
received any notice from the Commission pursuant to Section 8(e) of the 1940 Act
with respect to the 1940 Act Notification or the Registration Statement (or any
amendment or supplement to either of them).
Page 7
(bb) All advertising, sales literature, promotional materials or any
other materials or information (including "prospectus wrappers," "broker kits"
and any roadshow or investor presentations), whether in oral, printed or
electronic form, authorized, provided or prepared by the Fund or the Advisers in
connection with the offering and sale of the MMP Shares (collectively, the
"Marketing Materials") complied and comply in all material respects with the
applicable requirements of the Securities Act, the 1933 Act Rules and
Regulations and the rules and interpretations of the National Association of
Securities Dealers, Inc. ("NASD") and if required to be filed with the NASD
under the NASD's conduct rules were so filed. No Marketing Materials 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.
(cc) This Agreement and each of the Fund Agreements complies in all
material respects with all applicable provisions of the 1940 Act, the 1940 Act
Rules and Regulations, the Advisers Act and the Adviser's Act Rules and
Regulations.
(dd) The Fund will direct the investment of the proceeds of the
offering of the MMP Shares in such a manner as to comply with the requirements
of Subchapter M of the Code and intends to qualify as a regulated investment
company under Subchapter M of the Code.
(ee) The Fund will comply with all applicable securities and other
applicable laws, rules and regulations, including, without limitation, the
Xxxxxxxx-Xxxxx Act of 2002.
(ff) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement to either of them), no trustee of the
Fund is an "interested person" (as defined in the 1940 Act) of the Fund or an
"affiliated person" (as defined in the 1940 Act) of the Underwriter.
Section 2. Representations, Warranties and Agreements of the Advisers.
Each of the Advisers severally as to itself only and not jointly or as to any
other party, represents, warrants and agrees that:
(a) The Adviser has been duly organized or formed and is validly
existing as a limited partnership or limited liability company, as the case may
be, in good standing under the laws of its jurisdiction of organization or
formation, is duly registered and qualified to do business and is in good
standing in each jurisdiction in which its ownership or lease of property or the
conduct of its business as described in the Registration Statement and the
Prospectus (and any amendment or supplement to either) requires such
qualification, and has all partnership or limited liability company power and
authority necessary to own or hold their respective properties and to conduct
the business as described in the Registration Statement and the Prospectus (and
any amendment or supplement to either), except where the failure to so qualify
or to be in good standing would not reasonably be expected to have a Material
Adverse Effect.
Page 8
(b) The Adviser is duly registered as an investment adviser under the
Advisers Act and there does not exist any proceeding or any facts or
circumstances the existence of which could lead to any proceeding which could
adversely affect the registration or good standing of the Adviser with the
Commission. The Adviser 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 Fund Agreements (to which such Adviser is a party) or the
Sub-Advisory Agreement as contemplated by the Registration Statement and the
Prospectus (or any amendment or supplement thereto).
(c) This Agreement, the Fund Agreements (to which such Adviser is a
party) and the Sub-Advisory Agreement have each been duly authorized, executed
and delivered by such Adviser, and constitute valid and legally binding
agreements of such Adviser, enforceable against such Adviser 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 such Adviser'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.
(d) None of the execution, delivery and performance of this Agreement,
the performance of the Fund Agreements (to which such Adviser is a party) and
the Sub-Advisory Agreement or the consummation of the transactions contemplated
hereby and thereby (i) conflict with, result in the creation or imposition of
any lien, charge or encumbrance upon the assets of the Fund, or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which such Adviser is a party or by which such
Adviser is bound or to which any of the property or assets of such Adviser is
subject, (ii) result in any violation of the provisions of the organizational
documents or by-laws of such Adviser or (iii) result in the violation of any
statute or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over such Adviser or any of its properties or assets,
except in the case of clauses (i) and (iii), such conflicts, breaches or
violations that in the aggregate would not reasonably be expected to have a
Material Adverse Effect; and except for the registration of the MMP Shares under
the Securities Act and such consents, approvals, authorizations, registrations
or qualifications as may be required under the Exchange Act and applicable state
securities laws in connection with the purchase and distribution of the MMP
Shares by the Underwriter, no consent, approval, authorization or order of, or
filing or registration with, any such court or governmental agency or body is
required for the execution, delivery and performance of this Agreement, the
performance of the Fund Agreements (to which such Adviser is a party) and the
Sub-Advisory Agreement or the consummation of the transactions contemplated
hereby and thereby.
(e) The Adviser has the financial resources available to it necessary
for the performance of its services and obligations as contemplated in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto) and under this Agreement and the Fund Agreements (to which such Adviser
is a party) and the Sub-Advisory Agreement.
Page 9
(f) The Adviser carries, or is covered by, insurance in such amounts
and covering such risks as is adequate for the conduct of its businesses and the
value of its property and as is customary for companies engaged in similar
businesses in similar industries.
(g) The description of such Adviser and its business, and the
statements attributable to such Adviser, in the Registration Statement and the
Prospectus (and any amendment or supplement to either) complied and comply in
all material respects with the provisions of the Securities 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 necessary to make the statements therein (in the case of a prospectus, in
light of the circumstances under which they were made) not misleading.
(h) There are no legal or governmental proceedings pending to which
such Adviser is a party or of which any property or assets of such Adviser is
the subject which is reasonably likely to be determined adversely to such
Adviser and, if determined adversely to such Adviser, would be reasonably likely
to have a Material Adverse Effect; and to the best of such Adviser's knowledge,
no such proceedings are threatened or contemplated by governmental authorities
or threatened by others.
(i) Since the date as of which information is given in the Registration
Statement and the Prospectus through the date hereof, and except as may
otherwise be disclosed in the Prospectus, there have been no transactions
entered into by such Adviser which are material to such Adviser other than in
the ordinary course of its business.
(j) This Agreement, each of the Fund Agreements (to which such Adviser
is a party) and the Sub-Advisory Agreement 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.
(k) Except as stated in this Agreement and in the Prospectus (and any
amendment or supplement thereto), such Adviser has not taken and shall not take,
directly or indirectly, any action designed to cause or result in, or which
constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of the MMP Shares to facilitate the
sale or resale of the MMP Shares.
(l) Such Adviser is not (i) in violation of its organizational
documents or by-laws, (ii) in default in any material respect, and no event has
occurred which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it is bound or to
which any of its properties or assets is subject or (iii) in violation of any
law, ordinance, governmental rule, regulation or court decree to which it or its
property or assets may be subject or has failed to obtain any material license,
permit, certificate, franchise or other governmental authorization or permit
necessary to the ownership of its property or to the conduct of its business,
Page 10
except, in the case of clauses (ii) and (iii), such defaults, events, violations
or failures that in the aggregate would not reasonably be expected to have a
Material Adverse Effect.
Section 3. Purchase of the Shares by the Underwriter. On the basis of
the representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Fund agrees to issue and sell to the
Underwriter and the Underwriter agrees to purchase from the Fund [___] MMP
Shares.
The price of the MMP Shares shall be $_____ per share.
The Fund shall not be obligated to deliver any of the MMP Shares on the
Delivery Date (as hereinafter defined), except upon payment for all the MMP
Shares to be purchased on the Delivery Date as provided herein.
Section 4. Offering of MMP Shares by the Underwriter. The Underwriter
proposes to offer the MMP Shares for sale upon the terms and conditions set
forth in the Prospectus.
Section 5. Delivery of and Payment for the Shares. Delivery of and
payment for the MMP Shares shall be made at the offices of Xxxxxxxx & Xxxxxxxx
LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or through the
facilities of the Depository Trust Company or another mutually agreeable
facility, at 10:00 A.M., New York City time, on November __, 2003 or at such
other date or place as shall be determined by agreement between the Underwriter
and the Fund (the "Delivery Date"). On the Delivery Date, the Fund shall deliver
or cause to be delivered the MMP Shares to the Underwriter through the
facilities of the Depository Trust Company against payment to or upon the order
of the Fund of the purchase price by wire transfer in immediately available
funds. Time shall be of the essence, and delivery at the time and place
specified pursuant to this Agreement is a further condition of the obligation of
the Underwriter hereunder.
Section 6. Further Agreements of the Fund and the Advisers. The Fund
and the Advisers jointly and severally covenant and agree that:
(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 Securities Act before the offering of the MMP
Shares may commence, to use its reasonable best efforts to cause the
Registration Statement or such post-effective amendment to become effective
under the Securities 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, to file a Prospectus with the Commission pursuant to Rule 497(h) of
the 1933 Act Rules and Regulations as promptly as possible, not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement; if the Registration Statement does not
so omit such information, the Fund will file a Prospectus pursuant to 497(c) or
(j) of the Securities Act as promptly as possible, not later than the fifth
Page 11
business day following the execution and delivery of this Agreement; to make no
further amendment or any supplement to the Registration Statement or to the
Prospectus except as permitted herein; to advise the Underwriter, promptly after
it receives notice thereof, of the time when the Registration Statement or any
amendment thereto has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed and to furnish the
Underwriter with copies thereof; to advise the Underwriter, promptly after it
receives notice thereof, of the issuance by the Commission of any stop order or
of any order preventing or suspending the use of any Preliminary Prospectus or
the Prospectus, of the suspension of the qualification of the MMP Shares for
offering or sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or the Prospectus or for
additional information; and, in the event of the issuance of any stop order or
of any order preventing or suspending the use of any Preliminary Prospectus or
the Prospectus or suspending any such qualification, to use promptly its best
efforts to obtain its withdrawal;
(b) To deliver promptly to the Underwriter such number of the following
documents as it shall reasonably request: (i) conformed copies of the
Registration Statement as originally filed with the Commission and each
amendment thereto (in each case excluding exhibits) and (ii) each Preliminary
Prospectus, the Prospectus and any amended or supplemented Prospectus; and, if
the delivery of a prospectus is required at any time after the Effective Time in
connection with the offering or sale of the MMP Shares or any other securities
relating thereto and if at such time any events shall have occurred as a result
of which the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other reason it shall be necessary to amend or supplement the Prospectus
in order to comply with the Securities Act, to notify the Underwriter and, upon
its request, to file such document and to prepare and furnish without charge to
the Underwriter and to any dealer in securities as many copies as the
Underwriter may from time to time reasonably request of an amended or
supplemented Prospectus which will correct such statement or omission or effect
such compliance;
(c) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the judgment of the Fund or the Underwriter, be required by the
Securities Act or requested by the Commission;
(d) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus or any Prospectus
pursuant to Rule 497 of the 1933 Act Rules and Regulations, to furnish a copy
thereof to the Underwriter and its counsel and obtain the consent of the
Underwriter to the filing, which consent shall not be unreasonably withheld;
(e) As soon as practicable after the Effective Date, to make generally
available to the Fund's security holders and to deliver to the Underwriter an
Page 12
earnings statement of the Fund (which need not be audited) complying with
Section 11(a) of the Securities Act and the Rules and Regulations (including, at
the option of the Fund, Rule 158);
(f) For a period of three years following the Effective Date, to
furnish to the Underwriter, to the extent such information is not freely
available on the Internet, copies of all materials furnished by the Fund to its
shareholders and all public reports and all reports and financial statements
furnished by the Fund to the Commission pursuant to the Exchange Act or any rule
or regulation of the Commission thereunder;
(g) Promptly from time to time, to take such action as the Underwriter
may reasonably request to qualify the MMP Shares for offering and sale under the
securities laws of such jurisdictions as the Underwriter may request and to
comply with such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to complete the
distribution of the MMP Shares; provided that in connection therewith the Fund
shall not be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(h) For a period of 180 days from the date of the Prospectus, not to,
without the prior written consent of the Underwriter, directly or indirectly,
(1) offer for sale, sell, pledge or otherwise dispose of (or enter into any
transaction or device which is designed to, or could be expected to, result in
the disposition by any person at any time in the future of) any MMP Shares or
securities convertible into or exchangeable for MMP Shares, or sell or grant
options, rights or warrants with respect to any MMP Shares or securities
convertible into or exchangeable for MMP Shares, or (2) enter into any swap or
other derivatives transaction that transfers to another, in whole or in part,
any of the economic benefits or risks of ownership of such MMP Shares, whether
any such transaction described in clause (1) or (2) above is to be settled by
delivery of MMP Shares or other securities, in cash or otherwise; and
(i) To apply the net proceeds from the sale of the MMP Shares in a
manner consistent with the investment objectives, policies and restrictions of
the Fund as set forth in the Prospectus.
Section 7. Expenses. The Fund agrees to pay (a) the costs incident to
the authorization, issuance, sale and delivery of the MMP Shares and any taxes
payable in that connection; (b) the costs incident to the preparation, printing
and filing under the Securities Act and the 1940 Act of the Registration
Statement, the Prospectus, and the 1940 Act Notification and any amendments or
supplements and exhibits thereto; (c) the costs of distributing the Registration
Statement as originally filed and each amendment thereto and any post-effective
amendments thereof (including, in each case, exhibits), any Preliminary
Prospectus, the Prospectus and any amendment or supplement to the Prospectus,
all as provided in this Agreement; (d) the costs of producing and distributing
this Agreement, and any other related documents in connection with the offering,
purchase, sale and delivery of the MMP Shares; (e) the preparation, issuance and
delivery of the certificates for the MMP Shares, if any, to the Underwriter,
including any stock or other transfer taxes and any stamp or other duties
Page 13
payable upon the sale, issuance or delivery of the MMP Shares to the
Underwriter, (f) any applicable listing or other fees including the fees paid to
the rating agencies in connection with the rating of the MMP Shares; (g) the
fees and expenses of qualifying the MMP Shares under the securities laws of the
several jurisdictions as provided in Section 6(g) and of preparing, printing and
distributing a Blue Sky Memorandum (including related fees and expenses of
counsel to the Underwriter which shall not exceed $5,000); (h) all costs and
reasonable expenses of the Underwriter, other than the fees and disbursements of
counsel; (i) the fees and expenses of the Fund's accountants and the fees and
expenses of counsel for the Fund, of the transfer agent and the auction agent as
set forth in the Auction Agreement; and (j) all other costs and reasonable
expenses incident to the performance of the obligations of the Fund under this
Agreement. The Investment Adviser will pay (x) all of the Fund's organizational
expenses and (y) to the extent that the aggregate of the foregoing costs and
expenses incidental to the performance of the obligations (other than
organizational expenses) of the Fund under this Agreement exceed $______, all
such costs and expenses.
Section 8. Conditions of Underwriter's Obligations. The obligations of
the Underwriter hereunder are subject to the accuracy, when made and on the
Delivery Date, of the representations and warranties of the Fund and each of the
Advisers contained herein, to the performance by the Fund and each of the
Advisers of their respective obligations hereunder, and to each of the following
additional terms and conditions:
(a) The Prospectus shall have been timely filed with the Commission in
accordance with Section 6(a); no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and any request of the Commission for inclusion of additional
information in the Registration Statement or the Prospectus or otherwise shall
have been complied with.
(b) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Auction Agreement, the
MMP Shares, the Registration Statement and the Prospectus, and all other legal
matters relating to this Agreement and the transactions contemplated hereby
shall be reasonably satisfactory in all material respects to counsel for the
Underwriter, and the Fund shall have furnished to such counsel all documents and
information that they may reasonably request to enable them to pass upon such
matters.
(c) Xxxxxxx and Xxxxxx LLP, as counsel to the Fund, shall have
furnished to the Underwriter their written opinion, addressed to the Underwriter
and dated the Delivery Date, in form and substance reasonably satisfactory to
the Underwriter, to the effect that:
(i) The Fund is duly registered and qualified to do business
and is in good standing in each jurisdiction in which its ownership or
lease of property or the conduct of its business as described in the
Registration Statement and the Prospectus (and any amendment or
supplement to either) requires such qualification;
Page 14
(ii) All of the issued shares of beneficial interest of the
Fund were issued in compliance with federal and state securities laws;
(iii) The MMP Shares conform in all material respects to the
statements concerning them contained in the Prospectus and except as
described in the Prospectus under "Certain Provisions of the
Declaration of Trust," there are no restrictions upon the voting or
transfer of any of the Shares pursuant to the Fund's Declaration of
Trust or by-laws or any agreement or other instrument known to such
counsel; except for the restrictions on transfer on the MMP Shares
contained in the Auction Agreement;
(iv) The Fund is not (i) in violation of its Declaration of
Trust or by-laws, (ii) in default, and no event has occurred which,
with notice or lapse of time or both, would constitute such a default,
in the due performance or observance of any term, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which it is a party or by which it is
bound or to which any of its properties or assets is subject or (iii)
in violation of any law, ordinance, governmental rule, regulation or
court decree to which it or its property or assets may be subject or
has failed to obtain any material license, permit, certificate,
franchise or other governmental authorization or permit necessary to
the ownership of its property or to the conduct of its business, except
in the case of clauses (ii) and (iii), such defaults, events,
violations or failures that in the aggregate would not reasonably be
expected to have a Material Adverse Effect;
(v) To the best of such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Fund is a party or of which any
property or assets of the Fund is the subject which is reasonably
likely to be determined adversely to the Fund and, if determined
adversely to the Fund, would be reasonably likely to have a Material
Adverse Effect; and, to the best of such counsel's knowledge, no such
proceedings are threatened or contemplated by governmental authorities
or threatened by others;
(vi) The Registration Statement was declared effective under
the Securities Act as of the date and time specified in such opinion,
the Prospectus was filed with the Commission pursuant to the Rule 497
of the 1933 Act Rules and Regulations specified in such opinion on the
date specified therein and no stop order suspending the effectiveness
of the Registration Statement or any part thereof has been issued and,
to the knowledge of such counsel, no proceeding for that purpose is
pending or threatened by the Commission;
(vii) The Registration Statement and the Prospectus and any
further amendments or supplements thereto made by the Fund prior to the
Delivery Date (except for the financial statements and related
schedules therein, as to which such counsel need express no belief)
Page 15
comply as to form in all material respects with the requirements of the
Securities Act, the 1940 Act and the Rules and Regulations;
(viii) The statements contained in the Registration Statement
and the Prospectus (and any amendment or supplement thereto through the
date of the opinion), insofar as they describe matters of law, legal
proceedings, legal conclusions, the Fund's Declaration of Trust and
bylaws, contracts, agreements or other legal documents or refer to
federal statutes, rules and regulations, are correct in all material
respects and constitute a fair summary thereof;
(ix) There are no contracts or other documents which are
required to be described in the Registration Statement and the
Prospectus or filed as exhibits to the Registration Statement by the
Securities Act, the 1940 Act or by the Rules and Regulations which have
not been described in the Registration Statement and the Prospectus or
filed as exhibits to the Registration Statement;
(x) This Agreement and each of the Fund Agreements has been
duly authorized, executed and delivered by the Fund and constitute the
valid and legally binding agreements of the Fund, and, with respect to
the Fund Agreements, are enforceable against the Fund 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 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;
(xi) None of the issue and sale of the MMP Shares being
delivered on the Delivery Date by the Fund pursuant to this Agreement,
the execution, delivery and performance by the Fund of this Agreement,
the performance by the Fund of each of the Fund Agreements or the
consummation of the transactions contemplated hereby and thereby (i)
conflict with, result in the creation or imposition of any lien, charge
or encumbrance upon the assets of the Fund, or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel to which the Fund is a
party or by which the Fund is bound or to which any of the property or
assets of the Fund is subject, (ii) result in any violation of the
provisions of the Declaration of Trust or by-laws of the Fund or (iii)
result in the violation of any statute or any order, rule or regulation
known to such counsel of any court or governmental agency or body
having jurisdiction over the Fund or any of their properties or assets,
except in the case of clauses (i) and (iii), such conflicts, breaches
or violations that in the aggregate would not reasonably be expected to
have a Material Adverse Effect; and, except for the registration of the
MMP Shares under the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be required
under the Exchange Act and applicable state securities laws in
connection with the purchase and distribution of the MMP Shares by the
Page 16
Underwriter, no consent, approval, authorization or order of, or filing
or registration with, any such court or governmental agency or body is
required for the execution, delivery and performance of this Agreement,
the performance of the Fund Agreements by the Fund or the consummation
of the transactions contemplated hereby, except for such consents,
approvals, authorizations, orders, filings or registrations as have
been obtained or made;
(xii) This Agreement, the Fund Agreements and the Sub-Advisory
Agreement comply in all material respects with all applicable
provisions of the 1940 Act, the Advisers Act, the 1940 Act Rules and
Regulations and the Advisers Act Rules and Regulations;
(xiii) The description of each Adviser and its business, and
the statements attributable to each Adviser, in the Registration
Statement and the Prospectus (and any amendment or supplement thereto)
complied and comply in all material respects with the provisions of the
Securities Act, the 1940 Act, the Advisers Act, the Rules and
Regulations and the Advisers Act Rules and Regulations;
(xiv) To the best of such counsel's knowledge, there are no
contracts, agreements or understandings between the Fund and any person
granting such person the right to require the Fund to file a
registration statement under the Securities Act with respect to any
securities of the Fund owned or to be owned by such person or to
require the Fund to include such securities in the securities
registered pursuant to the Registration Statement or in any securities
being registered pursuant to any other registration statement filed by
the Fund under the Securities Act;
(xv) The Fund is duly registered under the 1940 Act as a
closed-end, 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 1940 Act Rules and Regulations and,
to the best of such counsel's knowledge after reasonable inquiry, the
Fund has not received any notice from the Commission pursuant to
Section 8(e) of the 1940 Act with respect to the 1940 Act Notification
or the Registration Statement (or any amendment or supplement to either
of them);
(xvi) All required action has been taken by the Fund under the
Securities Act, the Exchange Act and the 1940 Act to make the public
offering and consummate the sale of the MMP Shares pursuant to this
Agreement; the provisions of the Declaration of Trust and by-laws of
the Fund comply as to form in all material respects with the
requirements of the 1940 Act; the provisions of the Declaration of
Trust and by-laws of the Fund and the investment policies and
restrictions described in the Prospectus under the heading "The Fund's
Investments" comply in all material respects wit the requirements of
the 1940 Act; and
Page 17
(xvii) The statements made in the Registration Statement and
the Prospectus (and any amendment or supplement thereto through the
date of the opinion) under the caption "Federal Income Tax Matters" to
the extent they describe or summarize tax laws, legal conclusions,
doctrines or practices of the United States, are materially correct.
In rendering such opinion, such counsel may state that their opinion is
limited to matters governed by the Federal laws of the United States of America
and the laws of the State of Illinois. To the extent such counsel deems proper
and to the extent specified in such opinion, such counsel may rely, as to
matters involving the application of laws of the Commonwealth of Massachusetts
upon the opinion of Xxxxxxx XxXxxxxxx LLP or other counsel of good standing whom
such counsel believes to be reliable and who are satisfactory to the
Underwriter; provided that such reliance is expressly authorized by the opinion
so relied upon and a copy of each such opinion is delivered to the Underwriter
and is, in form and substance, satisfactory to Underwriter and its counsel.
Such opinion shall also be to the effect that (x) such counsel has
acted as counsel to the Fund in connection with the preparation of the
Registration Statement and (y) based on the foregoing, no facts have come to the
attention of such counsel which would lead such counsel to believe that the
Registration Statement (except for the financial statements and related
schedules therein, as to which such counsel need express no belief) as of the
Effective Date, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading, or that the Prospectus (except for
the financial statements and related schedules therein, as to which such counsel
need express no belief) contains any untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. The foregoing opinion and statement may be
qualified by a statement to the effect that such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus (other than as set
forth in clause (viii) above).
(d) Xxxxxxx XxXxxxxxx LLP as counsel to the Fund, shall have furnished
to the Underwriter their written opinion, addressed to the Underwriter and dated
the Delivery Date, in form and substance reasonably satisfactory to the
Underwriter, to the effect that:
(i) The Fund has been duly formed and is validly existing as a
business trust in good standing under the laws of the Commonwealth of
Massachusetts, and has all statutory trust power and authority
necessary to own or hold property and to conduct the business as
described in the Registration Statement and the Prospectus (and any
amendment or supplement to either), except where the failure to so
qualify or to be in good standing would not reasonably be expected to
have a Material Adverse Effect;
Page 18
(ii) The Fund has an authorized capitalization as set forth in
the Registration Statement and the Prospectus (or any amendment or
supplement thereto through the date of the opinion). All of the issued
shares of beneficial interest of the Fund have been duly and validly
authorized and issued, are fully paid and (except as described in the
Prospectus under "Certain Provisions of the Declaration of Trust")
non-assessable and conform to the description thereof contained in the
Registration Statement and the Prospectus (or any amendment or
supplement thereto through the date of the opinion). The MMP Shares
being delivered on the Delivery Date to the Underwriter hereunder have
been duly and validly authorized and, when issued and delivered against
payment therefor will be duly and validly issued, fully paid and
(except as described in the Prospectus under "Certain Provisions of the
Declaration of Trust") non-assessable; and
(iii) Except as described in the Prospectus under the heading
"Certain Provisions of the Declaration of Trust" there are no
preemptive rights to subscribe for or to purchase any of the Shares
pursuant to the Fund's Declaration of Trust or by-laws or any agreement
or other instrument known to such counsel; except for the restrictions
on transfer of the MMP Shares contained in the Auction Agreement.
In rendering such opinion, such counsel may state that their opinion is
limited to matters governed by the Federal laws of the United States of America,
the General Corporation Law of the Commonwealth of Massachusetts.
Such opinion shall also be to the effect that (x) such counsel has
acted as counsel to the Advisers in connection with the preparation of the
Registration Statement and (y) based on the foregoing, no facts have come to the
attention of such counsel which would lead such counsel to believe that the
Registration Statement (except for the financial statements and related
schedules therein, as to which such counsel need express no belief) as of the
Effective Date, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading, or that the Prospectus (except as
stated above) contains any untrue statement of a material fact or omits to state
a material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The foregoing opinion and statement may be qualified by a
statement to the effect that such counsel does not assume any responsibility for
the accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus.
(e) Counsel to each of the Advisers, shall have furnished to the
Underwriter their written opinion, addressed to the Underwriter and dated the
Delivery Date, in form and substance reasonably satisfactory to the Underwriter,
to the effect that:
(i) Each Adviser has been duly incorporated, organized or
formed and is validly existing as a limited partnership or limited
liability company, as the case may be, in good standing under the laws
of its jurisdiction of incorporation, is duly registered and qualified
to do business and is in good standing in each jurisdiction in which
Page 19
its ownership or lease of property or the conduct of its business as
described in the Registration Statement and the Prospectus (and any
amendment or supplement to either) requires such qualification, and has
all partnership or limited liability company power and authority
necessary to own or hold their respective properties and to conduct the
business as described in the Registration Statement and the Prospectus
(and any amendment or supplement to either), except where the failure
to so qualify or to be in good standing would not reasonably be
expected to have a Material Adverse Effect;
(ii) Each Adviser is duly registered 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 Fund Agreements (to which each
Adviser is a party) or the Sub-Advisory Agreement as contemplated by
the Registration Statement and the Prospectus (or any amendment or
supplement thereto);
(iii) This Agreement, the Management Agreement and the
Sub-Advisory Agreement have each been duly authorized, executed and
delivered by each Adviser that is a party to such agreement, and
constitute the valid and legally binding agreements of each Adviser,
and, with respect to the Management Agreement and the Sub-Advisory
Agreement are enforceable against each Adviser 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 each Adviser'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;
(iv) None of the execution, delivery and performance of this
Agreement by each Adviser that is a party to this Agreement, the
performance of the Management Agreement and the Sub-Advisory Agreement
by each Adviser that is a party to such agreement or the consummation
of the transactions contemplated hereby and thereby (i) conflict with,
result in the creation or imposition of any lien, charge or encumbrance
upon the assets of the Adviser, or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which such Adviser is a party or by which such Adviser
is bound or to which any of the property or assets of such Adviser is
subject, (ii) result in any violation of the provisions of the
organizational documents or by-laws of such Adviser or (iii) result in
any violation of any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over such
Adviser or any of its properties or assets, except in the case of
clauses (i) and (iii), such conflicts, breaches and violations that in
the aggregate would not reasonably be expected to have a Material
Adverse Effect; and except for the registration of the MMP Shares under
the Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the Exchange
Page 20
Act and applicable state securities laws in connection with the
purchase and distribution of the MMP Shares by the Underwriter, no
consent, approval, authorization or order of, or filing or registration
with, any such court or governmental agency or body is required for the
execution, delivery and performance of this Agreement, the performance
of the Management Agreement and the Sub-Advisory Agreement or the
consummation of the transactions contemplated hereby and thereby; and
(v) The Adviser is not (i) in violation of its organizational
documents or by-laws, (ii) in default, and no event has occurred which,
with notice or lapse of time or both, would constitute such a default,
in the due performance or observance of any term, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which it is a party or by which it is
bound or to which any of its properties or assets is subject or (iii)
in violation of any law, ordinance, governmental rule, regulation or
court decree to which it or its property or assets may be subject or
has failed to obtain any material license, permit, certificate,
franchise or other governmental authorization or permit necessary to
the ownership of its property or to the conduct of its business, except
in the case of clauses (ii) and (iii), such defaults, events,
violations or failures that in the aggregate would not reasonably be
expected to have a Material Adverse Effect; and
(vi) To the best of such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or governmental
proceedings pending to which any Adviser is a party or of which any
property or assets of any Adviser is the subject which is reasonably
likely to be determined adversely to such Adviser and, if determined
adversely to such Adviser, would be reasonably likely to have a
Material Adverse Effect; and, to the best of such counsel's knowledge,
no such proceedings are threatened or contemplated by governmental
authorities or threatened by others.
In rendering such opinion, such counsel may state that their opinion is
limited to matters governed by the Federal laws of the United States of America,
the General Corporation Law of the State of Delaware, and the laws of the State
of Illinois or the State of California, as the case may be. To the extent such
counsel deem proper and to the extent specified in such opinion, such counsel
may rely, as to matters involving the application of laws of the Commonwealth of
Massachusetts upon the opinion of Xxxxxxx XxXxxxxxx LLP or other counsel of good
standing whom such counsel believe to be reliable and who are satisfactory to
the Underwriter; provided that such reliance is expressly authorized by the
opinion so relied upon and a copy of each such opinion is delivered to the
Underwriter and is, in form and substance, satisfactory to the Underwriter and
its counsel.
Such opinion shall also be to the effect that (x) such counsel has
acted as counsel to the Advisers in connection with the preparation of the
Registration Statement and (y) based on the foregoing, no facts have come to the
Page 21
attention of such counsel which would lead such counsel to believe that the
Registration Statement (except for the financial statements and related
schedules therein, as to which such counsel need express no belief) as of the
Effective Date, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading, or that the Prospectus (except as
stated above) contains any untrue statement of a material fact or omits to state
a material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The foregoing opinion and statement may be qualified by a
statement to the effect that such counsel does not assume any responsibility for
the accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus.
(f) The Underwriter shall have received from Xxxxxxxx & Xxxxxxxx LLP,
counsel for the Underwriter, such opinion or opinions, dated the Delivery Date,
with respect to the issuance and sale of the MMP Shares, the Registration
Statement, the Prospectus and other related matters as the Underwriter may
reasonably require, and the Fund shall have furnished to such counsel such
documents as they reasonably request for the purpose of enabling them to pass
upon such matters.
(g) At the time of execution of this Agreement, the Underwriter shall
have received from Deloitte & Touche LLP a letter or letters, in form and
substance satisfactory to the Underwriter, addressed to the Underwriter and
dated the date hereof (i) confirming that they are independent public
accountants within the meaning of the Securities Act and are in compliance with
the applicable requirements relating to the qualification of accountants under
Rule 2-01 of Regulation S-X of the Commission and (ii) stating, as of the date
hereof (or, with respect to matters involving changes or developments since the
respective dates as of which specified financial information is given in the
Prospectus, as of a date not more than five days prior to the date hereof), the
conclusions and findings of such firm with respect to the financial information
and other matters ordinarily covered by accountants' "comfort letters" to
underwriters in connection with registered public offerings.
(h) With respect to the letter or letters of Deloitte & Touche LLP
referred to in the preceding paragraph and delivered to the Underwriter
concurrently with the execution of this Agreement (the "Initial Letter"), the
Fund shall have furnished to the Underwriter a letter (the "Bring-down Letter")
of such accountants, addressed to the Underwriter and dated the Delivery Date
(i) confirming that they are independent public accountants within the meaning
of the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, (ii) stating, as of the date of the bring-down letter (or,
with respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the Prospectus, as
of a date not more than five days prior to the date of the bring-down letter),
the conclusions and findings of such firm with respect to the financial
information and other matters covered by the initial letters and (iii)
confirming in all material respects the conclusions and findings set forth in
the initial letters.
Page 22
(i) The Fund shall have furnished to the Underwriter on the Delivery
Date a certificate, dated the Delivery Date, of its Chairman of the Board of
Trustees, its President or a Vice President and its Treasurer or an Assistant
Treasurer stating that:
(i) The representations, warranties and agreements of the Fund
in Section 1 are true and correct as of the date hereof and as of the
Delivery Date; the Fund has complied with all its agreements contained
herein prior to or on the Delivery Date; and the conditions set forth
in Section 8 have been fulfilled;
(ii) Since the respective dates as of which information is
given in the Prospectus, other than as set forth in or contemplated by
the Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement), (A) there has not occurred
any change or any development that might have a material adverse effect
on the business, prospects, financial condition or results of
operations of the Fund, (B) there has not been any change in the shares
of beneficial interest, short-term debt or long-term debt of the Fund
that might have a material adverse effect on the business, prospects,
financial condition or results of operations of the Fund, (C) the Fund
has not incurred any material liability or obligation, direct or
contingent, (D) there has not occurred a material loss or interference
with the Fund's business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree and (E) the Fund has not
declared or paid any dividend on its common shares of beneficial
interest, except for dividends declared in the ordinary course of
business and consistent with past practice, and, except as set forth in
or contemplated by the Prospectus, the Fund has not entered into any
transaction (other than purchases and sales of portfolio transactions)
or agreement (other than investment-related agreements) material to the
Fund; and
(iii) They examined the Registration Statement and the
Prospectus and, in their opinion (A) as of the Effective Date, the
Registration Statement did not contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (B)
as of its date and the Delivery Date, the Prospectus did not contain
any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading and (C) since the Effective Date, no event has
occurred which should have been set forth in a supplement to, or
amendment of, the Prospectus which has not been set forth in such a
supplement or amendment.
(j) First Trust shall have furnished to the Underwriter on the Delivery
Date a certificate, dated the Delivery Date, of the Chairman of its Board of
Directors, President or a Vice President and the chief financial officer of The
Charger Corporation, First Trust's general partner, dated the Delivery Date,
stating that:
(i) The representations, warranties and agreements of First
Trust in the Auction Agreement and the Underwriter Participation
Page 23
Agreement are true and correct as of the date hereof and as of the
Delivery Date, and First Trust has complied with all its agreements
contained therein; and
(ii) They examined the Registration Statement and the
Prospectus and, in their opinion (and in forming such opinion each
officer may rely on information provided by the other parties to this
Agreement) (A) as of the Effective Date, the Registration Statement did
not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, (B) as of its date and the Delivery
Date, the Prospectus did not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and (C) since
the Effective Date, no event has occurred which should have been set
forth in a supplement to, or amendment of, the Prospectus which has not
been set forth in such a supplement or amendment.
(k) The Fund shall not have sustained since the date of the latest
audited financial statements included in the Prospectus (A) any loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, or (B) since such date, there shall not
have been any change in the shares of beneficial interest, short-term debt or
long-term debt of the Fund or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
position, prospects, shareholders' equity or results of operations of the Fund,
otherwise than as described or contemplated in the Prospectus, the effect of
which, in any such case described in clause (A) or (B), is, in the judgment of
the Underwriter, so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the MMP
Shares being delivered on the Delivery Date on the terms and in the manner
contemplated in the Prospectus and in this Agreement.
(l) Each of the Advisers shall have furnished to the Underwriter a
certificate, dated the Delivery Date, of its Chairman of the Board of Directors,
its President, its Chief Executive Officer or a Vice President and its chief
financial officer, Controller or Assistant Controller stating that:
(i) The representations, warranties and agreements of such
Adviser in Sections 1 and 2 are true and correct as of the date hereof
and as of the Delivery Date; and such Adviser has complied with all its
agreements contained herein;
(ii) They examined the Registration Statement and the
Prospectus and, in their opinion (A) as of the Effective Date, the
Registration Statement did not contain any untrue statement of a
material fact and did not omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, (B) as of its date and the Delivery Date, the Prospectus
did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading and (C) since the Effective
Page 24
Date, no event has occurred which should have been set forth in a
supplement to, or amendment of, the Prospectus which has not been set
forth in such a supplement or amendment; and
(iii) Such Adviser is not (i) in violation of its
organizational documents or by-laws, (ii) in default, and no event has
occurred which, with notice or lapse of time or both, would constitute
such a default, in the due performance or observance of any term,
covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which it is a
party or by which it is bound or to which any of its properties or
assets is subject or (iii) in violation of any law, ordinance,
governmental rule, regulation or court decree to which it or its
property or assets may be subject or has failed to obtain any material
license, permit, certificate, franchise or other governmental
authorization or permit necessary to the ownership of its property or
to the conduct of its business, except in the case of clauses (ii) and
(iii), such defaults, events, violations or failures that in the
aggregate would not reasonably be expected to have a Material Adverse
Effect.
(m) The Fund shall have furnished to the Underwriter a report showing
compliance with the asset coverage requirements of the 1940 Act and the 1940 Act
MMP Shares Asset Coverage (as defined in the Registration Statement), each dated
the Delivery Date and in form and substance satisfactory to the Underwriter.
Each such report shall assume the receipt of the net proceeds from the sale of
the MMP Shares and may use portfolio holdings and valuations as of the close of
business of any day not more than six business days preceding the Delivery Date,
provided, however, that the Fund represents in such report that its total net
assets as of the Delivery Date have not declined by 5% or more from such
valuation date.
(n) The Fund shall have delivered and the Underwriter shall have
received evidence satisfactory to it that the MMP Shares are rated at least Aaa
by Xxxxx'x Investors Service, Inc. and AAA by Standard & Poor's Ratings Group, a
division of the McGraw Hill Companies as of the Delivery Date, and subsequent to
the execution and delivery of this Agreement, (i) no downgrading shall have
occurred in the rating accorded the MMP Shares by any "nationally recognized
statistical rating organization" as that term is defined by the Commission for
purposes of Rule 436(g)(2) of the 1933 Act Rules and Regulations and (ii) no
such organization shall have publicly announced that is has under surveillance
or review, with possible negative implications, its rating of the MMP Shares.
(o) Neither the Fund nor the Advisers shall have failed at or prior to
the Delivery Date to have performed or complied with any of the agreements
contained herein and required to be performed or complied with by them at or
prior to the Delivery Date.
(p) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or in
the over-the-counter market, or trading in any securities of the Fund on any
Page 25
exchange or in the over-the-counter market, shall have been suspended or
materially limited or the settlement of such trading generally shall have been
materially disrupted or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (ii) a banking
moratorium shall have been declared by Federal or state authorities, (iii) the
United States shall have become engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States or (iv) there
shall have occurred such a material adverse change in general economic,
political or financial conditions (or the effect of international conditions on
the financial markets in the United States shall be such), including, without
limitation, as a result of terrorist activities after the date hereof, or any
other calamity or crisis as to make it, in the judgment of the Underwriter,
impracticable or inadvisable to proceed with the public offering or delivery of
the MMP Shares being delivered on such Delivery Date on the terms and in the
manner contemplated in the Prospectus.
(q) The Underwriter shall not have discovered and disclosed to the Fund
on or prior to the Delivery Date that the Registration Statement or the
Prospectus or any amendment or supplement thereto contains an untrue statement
of a fact which, in the reasonable opinion of Xxxxxxxx & Xxxxxxxx LLP, counsel
for the Underwriter, is material or omits to state a fact which, in the
reasonable opinion of such counsel, is material and is required to be stated
therein or is necessary to make the statements therein not misleading.
(r) The Fund and the Advisers 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 Advisers).
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriter.
Section 9. Indemnification and Contribution.
(a) The Fund and the Advisers shall jointly and severally indemnify and
hold harmless the Underwriter, its directors, officers and employees and each
person, if any, who controls the Underwriter within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases and sales of MMP
Shares), to which the Underwriter, director, officer, employee or controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Preliminary Prospectus, the Prospectus, the Registration
Statement or in any amendment or supplement thereto including information deemed
to be a part of the Registration Statement pursuant to Rule 430A of the Rules
Page 26
and Regulations, if applicable, or (B) in any Marketing Materials, (ii) the
omission or alleged omission to state in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or in any Marketing Materials, any material fact required to be stated
therein or necessary to make the statements therein not misleading or (iii) any
act or failure to act or any alleged act or failure to act by the Underwriter in
connection with, or relating in any manner to, the MMP Shares or the offering
contemplated hereby, and which is included as part of or referred to in any
loss, claim, damage, liability or action arising out of or based upon matters
covered by clause (i) or (ii) above (provided that neither the Fund nor the
Advisers shall be liable under this clause (iii) to the extent that it is
determined in a final judgment by a court of competent jurisdiction that such
loss, claim, damage, liability or action resulted directly from any such acts or
failures to act undertaken or omitted to be taken by the Underwriter through its
gross negligence or willful misconduct), and shall reimburse the Underwriter and
each such director, officer, employee or controlling person promptly upon demand
for any legal or other expenses reasonably incurred by the Underwriter,
director, officer, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that neither the Fund nor the Advisers shall be liable in any such case to the
extent that any such loss, claim, damage, liability or action (i) arises out of,
or is based upon, any untrue statement or alleged untrue statement or omission
or alleged omission made in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or in any such amendment or supplement, in reliance
upon and in conformity with written information furnished to the Fund or the
Advisers by or on behalf of the Underwriter specifically for inclusion therein
which information consists solely of the information specified in Section 9(e);
or (ii) results solely from an untrue statement of material fact contained in,
or the omission of a material fact from, a Preliminary Prospectus, which untrue
statement or omission was corrected in the Prospectus (as then amended or
supplemented) if (A) the Underwriter sold Shares to the person alleging such
loss, claim, damage, liability or action without sending or giving, at or prior
to the written confirmation of such sale, a copy of the Prospectus (as then
amended or supplemented), (B) within a reasonable amount of time prior to such
sale or such confirmation, the Fund had furnished to the Underwriter copies of
the corrected Prospectus which, if delivered, would have cured the defect giving
rise to such loss, claim, damage, liability or action, and (C) the Underwriter
failed to deliver such corrected Prospectus. The foregoing indemnity agreement
is in addition to any liability which the Fund or the Advisers may otherwise
have to the Underwriter or to any director, officer, employee or controlling
person of the Underwriter.
(b) The Underwriter shall indemnify and hold harmless the Fund, its
officers and employees, each of its trustees, and each person, if any, who
controls the Fund within the meaning of the Securities Act, from and against any
loss, claim, damage or liability, joint or several, or any action in respect
thereof, to which the Fund or any such trustee, officer or controlling person
may become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus or in any
amendment or supplement thereto, or (ii) the omission or alleged omission to
Page 27
state in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, any material fact
required to be stated therein or necessary to make the statements therein not
misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to the Fund by or on
behalf of the Underwriter specifically for inclusion therein, which information
is limited to the information set forth in Section 9(e), and shall reimburse the
Fund and any such trustee, officer or controlling person for any legal or other
expenses reasonably incurred by the Fund or any such trustee, officer or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability which the Underwriter may otherwise have to the Fund or any such
trustee, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this Section 9
of notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 9, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 9 except to the extent it has been materially
prejudiced by such failure and, provided further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 9. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 9 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the indemnified party shall have the right to employ separate counsel to
represent the indemnified party, and its respective directors, officers,
employees and controlling persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought under this Section 9 if,
the named parties to any such action, suit or proceeding (including any
impleaded parties) include both an indemnified party (and/or its officers,
employees, trustees and each person who controls the indemnified party within
the meaning of the Securities Act) and the indemnifying party and the
indemnified party shall have been advised by its counsel that representation of
both the indemnified party (and/or its officers, employees, trustees and each
person who controls the indemnified party within the meaning of the Securities
Act) and the indemnifying party would be inappropriate under applicable
standards of professional conduct (whether or not such representation by the
same counsel has been proposed) in the reasonable judgment of the indemnified
party, it is advisable for the indemnified party and its directors, officers,
Page 28
employees and controlling persons to be jointly represented by separate counsel,
and in that event the fees and expenses of one such separate counsel shall be
paid by the Fund or the Advisers. No indemnifying party shall (i) without the
prior written consent of the indemnified parties (which consent shall not be
unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with the consent of
the indemnifying party or if there be a final judgment of the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold harmless any
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
(d) If the indemnification provided for in this Section 9 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 9(a) or 9(b) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such proportion
as shall be appropriate to reflect the relative benefits received by the Fund
and the Advisers (treated jointly as one person for this purpose) on the one
hand and the Underwriter on the other from the offering of the MMP 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 Advisers (treated jointly as one person for this purpose) on
the one hand and the Underwriter on the other with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative benefits received by the Fund and the Advisers (treated jointly as one
person for this purpose) on the one hand and the Underwriter on the other with
respect to such offering shall be deemed to be in the same proportion as the
total net proceeds from the offering of the MMP Shares purchased under this
Agreement (before deducting expenses) received by the Fund, on the one hand, and
the total underwriting discounts and commissions received by the Underwriter
with respect to the MMP Shares purchased under this Agreement, on the other
hand, bear to the total gross proceeds from the offering of the MMP Shares under
this Agreement, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to whether the
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Fund or
the Advisers, on one hand, or the Underwriter, on the other hand, the intent of
the parties and their relative knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Fund, the Advisers and the
Underwriter agree that it would not be just and equitable if contributions
pursuant to this Section were to be determined by pro rata allocation or by any
other method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
Page 29
thereof, referred to above in this Section shall be deemed to include, for
purposes of this Section 9(d), any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 9(d), the
Underwriter shall not be required to contribute any amount in excess of the
amount by which the total price at which the MMP Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which the Underwriter has otherwise paid or become liable to pay by
reason of any 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 Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
(e) The Underwriter confirms and the Fund and the Advisers acknowledge
that the statements set forth in the last sentence on the front cover page, the
name of the Underwriter and paragraphs five and eleven under the section
"Underwriting," in the Prospectus are correct and constitute the only
information concerning the Underwriter furnished in writing to the Fund
specifically for inclusion in the Registration Statement and the Prospectus.
Section 10. Termination. The obligations of the Underwriter hereunder
may be terminated by the Underwriter by notice given to and received by the Fund
prior to delivery of and payment for the MMP Shares if, prior to that time, any
of the events described in Sections 8(k) or 8(p), shall have occurred or if the
Underwriter shall decline to purchase the MMP Shares for any reason permitted
under this Agreement.
Section 11. Reimbursement of Underwriter's Expenses. If (a) the Fund
shall fail to tender the MMP Shares for delivery to the Underwriter by reason of
any failure, refusal or inability on the part of the Fund to perform any
agreement on its part to be performed, or because any other condition of the
Underwriter's obligations hereunder required to be fulfilled by the Fund is not
fulfilled or (b) the Underwriter declines to purchase the MMP Shares because of
a failure by the Fund or the Adviser to perform their respective obligations
under this Agreement, the Fund shall reimburse the Underwriter for all
reasonable out-of-pocket expenses (including fees and disbursements of counsel)
incurred by the Underwriter in connection with this Agreement and the proposed
purchase of the MMP Shares, and upon demand the Fund shall pay the full amount
thereof to the Underwriter.
Section 12. Notices, Etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Underwriter, shall be delivered or sent by mail, telex or
facsimile transmission to Xxxxxx Brothers Inc., 000 Xxxxxxx Xxxxxx, Xxx Xxxx, XX
00000, Attention: Syndicate Department (Fax: 000-000-0000), with a copy, in the
case of any notice pursuant to Section 9(c) the Director of Litigation, Office
of the General Counsel, Xxxxxx Brothers Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, XX
00000; and with a copy to Xxxxxxxx & Xxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx,
Page 30
New York, New York 10104, Attention: Xxxx X. Xxxxxx, Esq. (Fax: (000-000-0000;
Telephone (000) 000-0000);
(b) if to the Fund, shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Fund set forth in the Registration
Statement, Attention: X. Xxxxx Xxxxxxx (Fax: 000-000-0000); with a copy to
Xxxxxxx and Xxxxxx LLP, 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxx, XX 00000, Attention:
Xxxx X. Xxxx, Esq. (Fax: (000) 000-0000; Telephone (000) 000-0000); and
(c) if to the Sub-Adviser, shall be delivered or sent by mail, telex or
facsimile transmission to Four Corners Capital Management, LLC, 000 X. Xxxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx, 00000, Attention: Xxxxxxx X.
XxXxxxx, with a copy to Xxxxxx Xxxxxxxxx Xxxxx & Xxxxxxxx LLP, 0000 00xx Xxxxxx,
Xxxxx 0000X, Xxxxx Xxxxxx, Xxxxxxxxxx, 00000, Attention: Xxxxxxxx X. Xxxxx. Any
such statements, requests, notices or agreements shall take effect at the time
of receipt thereof. The Fund shall be entitled to act and rely upon any request,
consent, notice or agreement given or made on behalf of the Underwriter.
Section 13. Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the Underwriter, the Fund, the
Advisers, and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(A) the representations, warranties, indemnities and agreements of the Fund and
the Advisers contained in this Agreement shall also be deemed to be for the
benefit of the directors, officers and the person or persons, if any, who
control the Underwriter within the meaning of Section 15 of the Securities Act
and (B) the indemnity agreement of the Underwriter contained in Section 9(b) of
this Agreement shall be deemed to be for the benefit of trustees of the Fund,
officers of the Fund who have signed the Registration Statement and any person
controlling the Fund within the meaning of Section 15 of the Securities Act.
Nothing in this Agreement is intended or shall be construed to give any person,
other than the persons referred to in this Section 13, any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
contained herein.
Section 14. Survival. The respective indemnities, representations,
warranties and agreements of the Fund and the Underwriter contained in this
Agreement or made by or on behalf on them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Shares and shall
remain in full force and effect, regardless of any investigation made by or on
behalf of any of them or any person controlling any of them.
Section 15. Definition of the Term "Business Day". For purposes of this
Agreement, (a) "business day" means each Monday, Tuesday, Wednesday, Thursday or
Friday which is not a day on which banking institutions in New York are
generally authorized or obligated by law or executive order to close.
Section 16. Trademarks. Xxxxxx Brothers, Inc. hereby licenses the
Fund, on a non-exclusive basis, to use its trademarks "Money Market Cumulative
Preferred" and "MMP" in connection with the MMP Shares. The Fund agrees that,
other that in connection with and in reference to the MMP Shares, it will make
no use of such trademarks without the prior written consent of Xxxxxx Brothers
Inc. The provisions of this Section 16 shall survive the delivery of the MMP
Shares and shall remain in full force and effect.
Page 31
Section 17. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of New York.
Section 18. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
Section 19. Headings. The headings herein are inserted for convenience
of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
Section 20. Limitation of Liability. A copy of the Declaration of Trust
of the Fund is on file with the Secretary of the Commonwealth of Massachusetts.
This Agreement has been executed on behalf of the Fund by an officer of the Fund
in such capacity and not individually and the obligations of the Fund under this
Agreement are not binding upon such officer or any of the trustees or the
shareholders of the fund individually but are binding only upon the assets and
property of the Fund.
Page 32
If the foregoing correctly sets forth the agreement among the Fund, the
Advisers and the Underwriter, please indicate your acceptance in the space
provided for that purpose below.
Very truly yours,
FIRST TRUST/FOUR CORNERS SENIOR FLOATING
RATE INCOME FUND
By:
------------------------------------------
Name:
Title:
FIRST TRUST ADVISORS L.P.
By:
------------------------------------------
Name:
Title:
FOUR CORNERS CAPITAL MANAGEMENT, LLC
By:
------------------------------------------
Name:
Title:
Accepted:
XXXXXX BROTHERS INC.
By:
------------------------------------------
Name:
Authorized Representative
Page 33
