EXHIBIT (h)
4,200 SHARES
ING CLARION REAL ESTATE
INCOME FUND
SERIES W28 AUCTION PREFERRED SHARES
UNDERWRITING AGREEMENT
November 19, 2003
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
Citigroup Global Markets Inc.
c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
The undersigned, ING Clarion Real Estate Income Fund, a Delaware
statutory trust (the "Fund"), ING Clarion Real Estate Securities, L.P., a
Delaware limited partnership (the "Adviser"), and Clarion Capital LLC, a
Delaware limited liability company (the "Sub-Adviser"), address you as
Underwriters and as the Representative (the "Representative") of each of the
other persons, firms and corporations, if any, listed in Schedule I hereto
(herein collectively called "Underwriters"). The Fund proposes to issue and sell
an aggregate of 4,200 shares of Series W28 Auction Preferred Shares, $.001 par
value per share, liquidation preference $25,000 per share (the "Shares"), of the
Fund to the Underwriters.
The Fund, the Adviser and the Sub-Adviser wish to confirm as follows
their agreements with you and with any other Underwriters on whose behalf you
are acting in connection with the purchase of the Shares by the Underwriters.
The Fund has entered into an investment management agreement with the
Adviser dated September 30, 2003 (the "Management Agreement"), an administration
agreement with The Bank of New York ("BONY") dated September 30, 2003 (the
"Administration Agreement"), a Custodian Agreement with BONY dated September 30,
2003 (the "Custodian Contract"), a Transfer Agency Services Agreement with BONY
dated September 30, 2003 (the "Transfer Agency Agreement"), an Auction Agency
Agreement with BONY dated November 20, 2003 (the "Auction Agency Agreement") and
a Letter Agreement with the Depository Trust Company dated November __, 2003
(the "DTC Agreement"). In addition, the Fund has adopted a dividend reinvestment
plan (the "Dividend Reinvestment Plan"), pursuant to which holders of shares of
common stock, par value $.001 per share, of the Fund (the "Common Shares") shall
have their dividends automatically reinvested in additional Common Shares unless
they elect to receive such dividends in cash. Collectively, the Management
Agreement, Administration Agreement, Custodian Contract, Transfer Agency
Agreement, Auction Agency Agreement and DTC Agreement are herein referred to as
the "Fund Agreements." The Adviser and the Fund have entered into a Sub-Advisory
Agreement with the Sub-Adviser dated September 30, 2003 (the "Sub-Advisory
Agreement"). Collectively the Management Agreement, Administration Agreement and
Sub-Advisory Agreement are herein referred to as the "Adviser Agreements." This
Underwriting Agreement is herein referred to as the "Agreement."
1. Registration Statement and Prospectus. The Fund has prepared
and filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended (the
"1933 Act"), the Investment Company Act of 1940, as amended (the "1940 Act"),
and the rules and regulations of the Commission under the 1933 Act (the "1933
Act Rules and Regulations") and the 1940 Act (the "1940 Act Rules and
Regulations" and together with the 1933 Act Rules and Regulations, the "Rules
and Regulations") a registration statement on Form N-2 (File No. 333-109484
under the 1933 Act) (the "registration statement"), including a prospectus and
statement of additional information relating to the Shares, and a notification
of registration of the Fund as an investment company under the 1940 Act on Form
N-8A (File No. 811-21404) under the 1940 Act (the "1940 Act Notification") and
may pursuant to the Rules and Regulations prepare and file an additional
registration statement relating to a portion of the Shares pursuant to Rule
462(b) of the 1933 Act Rules and Regulations (a "Rule 462 registration
statement"). The term "Registration Statement" as used in this Agreement means
the registration statement (including all financial schedules and exhibits), as
amended at the time it becomes effective under the 1933 Act or, if the
registration statement became effective under the 1933 Act prior to the
execution of this Agreement, as amended or supplemented thereto, prior to the
execution of this Agreement and includes any information deemed to be included
by Rule 430A under the 1933 Act Rules and Regulations. If it is contemplated, at
the time this Agreement is executed, that a post-effective amendment to the
registration statement will be filed under the 1933 Act and must be declared
effective before the offering of Shares may commence, the term "Registration
Statement" as used in this Agreement means the Registration Statement as amended
by said post-effective amendment. If the Fund has filed a Rule 462 registration
statement, then the reference herein to the term "Registration Statement" shall
include such Rule 462 registration statement. The term "Prospectus" as used in
this Agreement means the prospectus and statement of additional information in
the forms included in the Registration Statement or, if the prospectus and
statement of additional information included in the Registration Statement omit
information in reliance on Rule 430A under the 1933 Act Rules and Regulations
and such information is included in a prospectus and statement of additional
information filed with the Commission pursuant to Rule 497(h) under the 1933 Act
Rules and Regulations, the term "Prospectus" as used in this Agreement means the
prospectus and statement of additional information in the forms included in the
Registration Statement as supplemented by the addition of the information
contained in the prospectus (including the statement of additional information)
filed with the Commission pursuant to Rule 497(h). The term "Prepricing
Prospectus" as used in this Agreement means the prospectus and statement of
additional information subject to completion in the form included in the
Pre-Effective Amendment No. 1 to the registration statement with the Commission
and as such prospectus and statement of additional information shall have been
amended or supplemented from time to time prior to the date of the Prospectus.
The terms "Registration Statement," "Prospectus" and "Prepricing Prospectus"
shall also include any financial statements and other information included or
incorporated by reference therein.
The Fund has furnished the Representative with copies of such
Registration Statement, each amendment to such Registration Statement filed with
the Commission and each Prepricing Prospectus.
2. Agreements to Sell and Purchase. The Fund hereby agrees,
subject to all the terms and conditions set forth herein, to issue and to sell
to each Underwriter and, upon the basis of the representations, warranties and
agreements of the Fund, the Adviser and the Sub-Adviser herein contained and
subject to all of the other terms and conditions set forth herein, each
Underwriter agrees, severally and not jointly, to purchase from the Fund at a
purchase price of $24,750 per Share (the "Price per Share"), the number of
Shares set forth opposite the name of such Underwriter in Schedule I hereto.
3. Terms of Public Offering. The Fund and the Adviser have been
advised by you that the Underwriters propose to make a public offering of their
respective portions of the Shares as soon after the
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Registration Statement has become effective and this Agreement has been executed
as in your judgment is advisable and initially to offer the Shares upon the
terms set forth in the Prospectus.
4. Delivery of Shares and Payments Therefor.
(a) Payment of the purchase price for the Shares shall be
made to the Fund by Federal Funds wire transfer, against delivery of
the certificate or certificates, if any, (or, if no certificates,
against notification of electronic delivery) for the Shares to the
Representative through the facilities of the Depository Trust Company
("DTC") for the respective accounts of the Underwriters. Delivery to
the Underwriters of and payment to the Fund for the Shares and
compensation of the Underwriters with respect thereto shall be made at
the offices of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, ▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ at 10:00 a.m. New York City time on November
20, 2003 (the "Closing Date"). The place of closing for the Shares and
the Closing Date may be varied by agreement between the Fund and ▇.▇.
▇▇▇▇▇▇▇ & Sons, Inc., as the managing representative (the "Managing
Representative") of the Underwriters.
(b) The Shares shall be registered in such names and in
such denominations as the Underwriters shall request prior to 1:00
P.M., New York City time (or such other time as the parties agree) on
the first business day preceding the Closing Date. Certificates for
Shares, if any, will be made available to you in New York City for
inspection and packaging not later than 9:00 A.M., New York City time,
on the business day next preceding the Closing Date. The certificates,
if any, evidencing the Shares to be purchased hereunder shall be
delivered to you on the Closing Date, against payment of the purchase
price therefor in immediately available funds in the manner described
above.
5. Agreements of the Fund, the Adviser and the Sub-Adviser. The
Fund, the Adviser and the Sub-Adviser, jointly and severally, agree with the
several Underwriters as follows:
(a) If, at the time this Agreement is executed and
delivered, it is necessary for the Registration Statement or a
post-effective amendment thereto to be declared effective under the
1933 Act before the offering of the Shares may commence, the Fund will
use its best efforts to cause the Registration Statement or such
post-effective amendment to become effective under the 1933 Act as soon
as possible. If the Registration Statement has become effective and the
Prospectus contained therein omits certain information at the time of
effectiveness pursuant to Rule 430A of the 1933 Act Rules and
Regulations, the Fund will file a prospectus including such information
pursuant to Rule 497(h) of the 1933 Act Rules and Regulations, as
promptly as practicable, but no later than the second business day
following the earlier of the date of the determination of the offering
price of the Shares or the date the Prospectus is first used after the
effective date of the Registration Statement. If the Registration
Statement has become effective and the Prospectus contained therein
does not so omit such information, the Fund will file a Prospectus or
certification pursuant to Rule 497(c) or (j), as the case may be, of
the 1933 Act Rules and Regulations as promptly as practicable, but no
later than the fifth business day following the date of the later of
the effective date of the Registration Statement or the commencement of
the public offering of the Shares after the effective date of the
Registration Statement. The Fund will advise you promptly and, if
requested by you, will confirm such advice in writing (i) when the
Registration Statement or such post-effective amendment has become
effective, (ii) when the Prospectus has been timely filed pursuant to
Rule 497(c) or Rule 497(h) of the 1933 Act Rules and Regulations or
(iii) when the certification permitted pursuant to Rule 497(j) of the
1933 Act Rules and Regulations has been timely filed, whichever is
applicable.
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(b) The Fund, and (in the case of (iii)(B) below with
respect to communications received by the Adviser or the Sub-Adviser)
the Adviser or the Sub-Adviser, will advise you promptly and, if
requested by you, will confirm such advice in writing: (i) of any
request made by the Commission for amendment of or a supplement to the
Registration Statement, the Prospectus or any Prepricing Prospectus (or
any amendment or supplement to any of the foregoing) or for additional
information, (ii) of the issuance by the Commission, any state
securities commission, any national securities exchange, any
arbitrator, any court or any other governmental, regulatory,
self-regulatory or administrative agency or any official of any order
suspending the effectiveness of the Registration Statement, prohibiting
or suspending the use of the Prospectus or any Prepricing Prospectus,
of any notice pursuant to Section 8(e) of the 1940 Act, of the
suspension of qualification of the Shares for offering or sale in any
jurisdiction, or the initiation or contemplated initiation of any
proceeding for any such purposes, (iii) of receipt by (A) the Fund, any
affiliate of the Fund or attorney of the Fund of any other material
communication from the Commission, or (B) the Fund, the Adviser, the
Sub-Adviser, any affiliate of the Fund, the Adviser or the Sub-Adviser
or attorney of the Fund, the Adviser or the Sub-Adviser of any other
material communication from the Commission, any state securities
commission, any national securities exchange, any arbitrator, any court
or any other governmental, regulatory, self-regulatory or
administrative agency or any official relating, in the case of either
clause (A) or (B), to the Fund (if such communication relating to the
Fund is received by such person within three years after the date of
this Agreement), the Registration Statement, the Prospectus, any
Prepricing Prospectus, (or any amendment or supplement to any of the
foregoing) or this Agreement, any of the Fund Agreements or the Adviser
Agreements and (iv) within the period of time referred to in paragraph
(f) below, of any material, adverse change in the condition (financial
or other), business, business prospects, properties, net assets or
results of operations of the Fund (other than as a result of changes in
market conditions generally or the market for real estate securities
generally) or any event which has or would reasonably be expected to
have a material adverse effect on the ability of the Adviser or the
Sub-Adviser to perform their respective obligations under this
Agreement, the Advisory Agreement or the Sub-Advisory Agreement, as the
case may be, or of the happening of any event (but as to each of the
Fund, the Adviser and the Sub-Adviser, an event known to that
respective entity) which makes any statement of a material fact made in
the Registration Statement, the Prospectus or any Prepricing Prospectus
(or any amendment or supplement to any of the foregoing) untrue or
which requires the making of any additions to or changes in the
Registration Statement, the Prospectus, or any Prepricing Prospectus
(or any amendment or supplement to any of the foregoing) in order to
state a material fact required by the 1933 Act, the 1940 Act or the
Rules and Regulations to be stated therein or necessary in order to
make the statements therein (in the case of a prospectus, in light of
the circumstances under which they were made) not misleading or of the
necessity to amend or supplement the Registration Statement, the
Prospectus, or any Prepricing Prospectus (or any amendment or
supplement to any of the foregoing) to comply with the 1933 Act, the
1940 Act, the Rules and Regulations or any other law or order of any
court or regulatory body. If at any time the Commission shall issue any
order suspending the effectiveness of the Registration Statement,
prohibiting or suspending the use of the Prospectus (or any amendment
or supplement to any of the foregoing) or suspending the qualification
of the Shares for offering or sale in any jurisdiction, the Fund, the
Adviser and the Sub-Adviser will use their best efforts to obtain the
withdrawal of such order at the earliest possible time. If at any time
any national securities exchange, any state securities commission, any
arbitrator, any court or any other governmental, regulatory,
self-regulatory or administrative agency or any official shall issue
any order suspending the effectiveness of the Registration Statement,
prohibiting or suspending the use of the Prospectus (or any amendment
or supplement to any of the foregoing) or suspending the qualification
of the Shares for offering or sale in any jurisdiction, the Fund, the
Adviser and the
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Sub-Adviser will use their respective best efforts to obtain the
withdrawal of such order at the earliest possible time.
(c) The Fund will furnish to you, without charge, one
signed copy of the registration statement as originally filed with the
Commission and of each amendment thereto, including financial
statements and all exhibits thereto and will also furnish to you,
without charge, such number of conformed copies of the registration
statement as originally filed and of each amendment thereto, but
without exhibits, as you may reasonably request.
(d) Within five years from the date hereof, the Fund will
not (i) file any amendment (except any post-effective amendment
required by Rule 8b-16 of the 1940 Act which is filed with the
Commission after the later of (x) one year from the date of this
Agreement or (y) the date on which the distribution of the Shares is
completed) to the Registration Statement or make any amendment or
supplement to the Prospectus or any Prepricing Prospectus (or any
amendment or supplement to any of the foregoing) of which you shall not
previously have been advised or (with respect to amendments filed
within two years from the date hereof) to which you shall reasonably
object within two business days after being so advised or (ii) so long
as, in the opinion of counsel for the Underwriters, a Prospectus is
required to be delivered in connection with sales of Shares by any
Underwriter or dealer, file any information, documents or reports
pursuant to the 1933 Act, the 1940 Act or the Securities Exchange Act
of 1934, as amended (the "1934 Act"), without delivering a copy of such
information, documents or reports to you, as Representative of the
Underwriters, prior to or concurrently with such filing.
(e) Prior to the execution and delivery of this
Agreement, the Fund has delivered to you, without charge, in such
quantities as you have reasonably requested, copies of each form of any
Prepricing Prospectus. The Fund consents to the use, in accordance with
the provisions of the 1933 Act and with the securities or Blue Sky laws
of the jurisdictions in which the Shares are offered by the several
Underwriters and by dealers, prior to the date of the Prospectus, of
each Prepricing Prospectus so furnished by the Fund.
(f) As soon after the execution and delivery of this
Agreement as reasonably possible and thereafter from time to time, for
such period as in the opinion of counsel for the Underwriters a
prospectus is required by the 1933 Act to be delivered in connection
with sales of Shares by any Underwriter or dealer, the Fund will
promptly deliver to each Underwriter and each dealer, without charge,
as many copies of the Prospectus (and of any amendment or supplement
thereto) as you may reasonably request. The Fund consents to the use of
the Prospectus (and of any amendments or supplements thereto) in
accordance with the provisions of the 1933 Act and with the securities
or Blue Sky laws of the jurisdictions in which the Shares are offered
by the several Underwriters and by all dealers to whom Shares may be
sold, both in connection with the offering or sale of the Shares and
for such period of time thereafter as the Prospectus is required by law
to be delivered in connection with sales of Shares by any Underwriter
or dealer. If during such period of time any event shall occur that in
the judgment of the Fund or in the opinion of counsel for the
Underwriters is required to be set forth in the Registration Statement
or the Prospectus (as then amended or supplemented) or should be set
forth therein in order to make the statements therein (in the case of
the Prospectus, in light of the circumstances under which they were
made) not misleading or if it is necessary to supplement or amend the
Registration Statement or the Prospectus to comply with the 1933 Act,
the 1940 Act, the Rules and Regulations or any other applicable law,
rule or regulation, the Fund will forthwith notify you of such event,
prepare and, subject to the provisions of paragraph (d) above, promptly
file with the Commission an appropriate amendment or supplement thereto
and will furnish as promptly as reasonably possible to the Underwriters
and dealers, without charge, such number of
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copies thereof as they may reasonably request; provided, however, that
if such amendment or supplement is required solely as a result of a
material misstatement in or material omission from the information
furnished in writing by or on behalf of an Underwriter to the Fund, the
Adviser or the Sub-Adviser expressly for use in the Registration
Statement or the Prospectus (such information, as described in Section
9(h) of this Agreement, being referred to herein as the "Underwriter
Information"), then the Fund shall deliver such amendment or supplement
at cost.
(g) The Fund will cooperate with you and with counsel for
the Underwriters in connection with any registration or qualification
of the Shares for offering and sale by the several Underwriters and by
dealers as may be required under the applicable securities or Blue Sky
laws of such jurisdictions as you may designate and will file such
consents to service of process or other documents necessary or
appropriate in order to effect such registration or qualification;
provided, however, that the foregoing shall not apply to the extent
that the Shares are "covered securities" that are exempt from state
regulation of securities offerings pursuant to Section 18 of the 1933
Act.
(h) As soon as practicable, but in no event later than
the last day of the 18th full calendar month following the calendar
quarter in which the effective date of the Registration Statement
falls, the Fund will make generally available to its security holders
an earnings statement, which need not be audited, which earnings
statement shall satisfy the provisions of Section 11(a) of the 1933 Act
and Rule 158 of the 1933 Act Rules and Regulations.
(i) The Fund will comply with the undertaking set forth
in sub-item 6 of Item 33 of Part C of the Registration Statement.
(j) During the period of three years hereafter, the Fund
will furnish or will have furnished to you as soon as available, a copy
of each report of the Fund mailed to shareholders or filed with the
Commission (other than reports on Form N-SAR) or furnished to the
American Stock Exchange (the "AMEX").
(k) If this Agreement shall terminate or be terminated
after execution pursuant to any provisions hereof (other than pursuant
to the second paragraph of Section 11 hereof or by notice given by you
terminating this Agreement pursuant to Section 12 hereof) or if this
Agreement shall be terminated by the Underwriters because of any
inability, failure or refusal on the part of the Fund, the Adviser or
the Sub-Adviser to comply with any material terms in this Agreement or
because any of the conditions in Section 10 of this Agreement required
to be complied with or fulfilled by them are not satisfied, then the
Fund, the Adviser and the Sub-Adviser, jointly and severally, agree to
reimburse the Representative for all out-of-pocket expenses not to
exceed the amounts set forth in Section 13 of this Agreement (including
reasonable fees and expenses of counsel for the Underwriters) incurred
by you in connection herewith.
(l) The Fund will direct the investment of the net
proceeds of the offering of the Shares (i) in accordance with the
description set forth in the Prospectus and (ii) in such a manner as to
comply with the investment objectives, policies and restrictions of the
Fund as described in the Prospectus.
(m) The Fund will file the requisite copies of the
Prospectus with the Commission in a timely fashion pursuant to Rule
497(c) or Rule 497(h) of the 1933 Act Rules and Regulations, whichever
is applicable or, if applicable, will file in a timely fashion the
certification permitted by Rule 497(j) of the 1933 Act Rules and
Regulations and will advise you of the time and manner of such filing.
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(n) Except as provided in this Agreement, the Fund will
not sell, contract to sell or otherwise dispose of, any preferred stock
of the Fund or any securities convertible into or exercisable or
exchangeable for preferred stock of the Fund or grant any options or
warrants to purchase preferred stock of the Fund, for a period of 180
days after the date of the Prospectus, without the prior written
consent of the Representative.
(o) The Fund will direct the investment of the proceeds
of the offering of the Shares so as to comply with the requirements of
Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code"), to qualify as a regulated investment company under the Code.
6. Representations and Warranties of the Fund, the Adviser and
the Sub-Adviser. The Fund, the Adviser and the Sub-Adviser, jointly and
severally, represent and warrant to each Underwriter that:
(a) Each Prepricing Prospectus included as part of the
registration statement as originally filed or as part of any amendment
or supplement thereto or filed pursuant to Rule 497 of the 1933 Act
Rules and Regulations, complied when so filed in all material respects
with the provisions of the 1933 Act, the 1940 Act and the Rules and
Regulations (except that this representation and warranty does not
apply to statements in or omissions from the Prepricing Prospectus (and
any amendment or supplement thereto) made in reliance upon and in
conformity with the Underwriter Information) and the Commission has not
issued any order preventing or suspending the use of the Prepricing
Prospectus.
(b) The registration statement, in the form in which it
became or becomes effective and also in such form as it may be when any
post-effective amendment thereto shall become effective, the Prospectus
and any amendment or supplement thereto when filed with the Commission
under Rule 497 of the 1933 Act Rules and Regulations and any amendment
or supplement thereto when filed with the Commission complied or will
comply in all material respects with the provisions of the 1933 Act,
the 1940 Act and the Rules and Regulations and each of the Registration
Statement and the Prospectus (or any supplement or amendment to either
of them) did not or will not at any such times contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein (in
the case of the Prospectus, in light of the circumstances under which
they were made) not misleading; except that this representation and
warranty does not apply to statements in or omissions from the
Registration Statement and the Prospectus (and any amendment or
supplement to either of them) made in reliance upon and in conformity
with the Underwriter Information.
(c) All the outstanding Common Shares have been duly
authorized and validly issued, are fully paid and nonassessable (except
as provided in the last sentence of Section 3.8 of the Declaration of
Trust ("Declaration")) and are free of any preemptive or similar
rights; the Shares have been duly authorized and, when issued and
delivered to the Underwriters against payment therefor in accordance
with the terms hereof, will be validly issued, fully paid and
nonassessable and free of any preemptive or similar rights; and the
capital stock of the Fund conforms in all material respects to the
description thereof in the Registration Statement or the Prospectus (or
any amendment or supplement to either of them). Except for the Shares
and the Common Shares, no other shares of capital stock are issued or
outstanding and the capitalization of the Fund conforms in all material
respects to the description thereof in the Registration Statement and
the Prospectus (or any amendment or supplement to either of them).
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(d) The Fund has been duly formed and is validly existing
in good standing as a statutory trust under the laws of the State of
Delaware, with full statutory trust power and authority to own, lease
and operate its properties and to conduct its business as described in
the Registration Statement and the Prospectus (and any amendment or
supplement to either of them) and is duly registered and qualified to
conduct business and is in good standing in each jurisdiction or place
where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure
so to register or to qualify does not or would not have a material,
adverse effect on the condition (financial or other), business,
business prospects, properties, net assets or results of operations of
(a "Material Adverse Effect") the Fund. The Fund has no subsidiaries.
(e) There are no legal or governmental proceedings
pending or, to the knowledge of the Fund, threatened, against the Fund,
or to which the Fund or any of its properties is subject, that are
required to be described in the Registration Statement or the
Prospectus (and any amendment or supplement to either of them) but are
not described therein and there are no agreements, contracts,
indentures, leases or other instruments that are required to be
described in the Registration Statement or the Prospectus (or any
amendment or supplement to either of them) or to be filed as an exhibit
to the Registration Statement that are not described therein or filed
as an exhibit thereto as required by the 1933 Act, the 1940 Act or the
Rules and Regulations.
(f) The Fund is not (i) in violation of its Declaration,
the Statement of Preferences (the "Statement") adopted in connection
with the issuance of the Shares, by-laws or other organizational
documents, (ii) in violation of any law, ordinance, administrative or
governmental rule or regulation applicable to the Fund or of any decree
of the Commission, any state securities commission, any national
securities exchange, any arbitrator, any court or any other
governmental, regulatory, self-regulatory or administrative agency or
any other agency or any body or official having jurisdiction over the
Fund or (iii) in breach or default in the performance of any
obligation, agreement or condition contained in any bond, debenture,
note or any other evidence of indebtedness or in any material
agreement, indenture, lease or other instrument to which the Fund is a
party or by which it or any of its properties may be bound, except, in
the case of (ii) and (iii) above, for violations, breaches or defaults
that do not or would not have, either individually or in the aggregate,
a Material Adverse Effect on the Fund.
(g) Neither the issuance and sale of the Shares, the
execution, delivery or performance of this Agreement or any of the Fund
Agreements by the Fund, nor the consummation by the Fund of the
transactions contemplated hereby or thereby (i) requires any consent,
approval, authorization or order of or registration or filing with the
Commission, any state securities commission, any national securities
exchange, any arbitrator, any court, regulatory body, administrative
agency or other governmental body, agency or official having
jurisdiction over the Fund (except (A) such as have been obtained or
made prior to the date of this Agreement, (B) for compliance with the
securities or Blue Sky laws of various jurisdictions which have been or
will be effected in accordance with this Agreement and (C) for
compliance with the filing requirements, if any, of the NASD Division
of Corporate Finance) or conflicts or will conflict with or constitutes
or will constitute a breach of the Declaration, Statement, bylaws, or
other organizational documents of the Fund or (ii) (A) conflicts or
will conflict with or constitutes or will constitute a breach of or a
default under any agreement, indenture, lease or other instrument to
which the Fund is a party or by which it or any of its properties may
be bound or (B) violates or will violate any statute, law, regulation
or filing or judgment, injunction, order or decree applicable to the
Fund or any of its properties or will result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Fund pursuant to the terms of any agreement or instrument
to which it is a party or by which it may be bound or to which any
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of the property or assets of the Fund is subject except, in the case of
(ii) above, for conflicts, breaches, defaults, violations or
encumbrances that do not or would not have, either individually or in
the aggregate, a Material Adverse Effect on the Fund. As of the date
hereof, the Fund is not subject to any order of any court or of any
arbitrator, governmental authority or administrative agency that has or
would have, either individually or in the aggregate, a Material Adverse
Effect on the Fund.
(h) Since the date as of which information is given in
the Registration Statement and the Prospectus (and any amendment or
supplement to either of them), except as otherwise stated therein, (i)
there has been no change, whether or not arising in the ordinary course
of business, that has or would have a Material Adverse Effect on the
Fund (other than as a result of a change in the financial markets
generally); and (ii) there have been no transactions entered into by
the Fund other than those in the ordinary course of its business or as
described in the Prospectus (and any amendment or supplement thereto).
(i) Ernst & Young LLP, who have audited the Statement of
Assets and Liabilities included in, and whose report appears in, the
Registration Statement and the Prospectus (and any amendment or
supplement to either of them), are independent public accountants with
respect to the Fund as required by the 1933 Act, the 1940 Act and the
Rules and Regulations.
(j) The financial statements, together with related
schedules and notes, included or incorporated by reference in the
Registration Statement or the Prospectus (or any amendment or
supplement to either of them) present fairly the financial position of
the Fund on the basis stated in the Registration Statement at the
respective dates or for the respective periods to which they apply;
such statements and related schedules and notes have been prepared in
accordance with generally accepted accounting principles consistently
applied throughout the periods involved except as disclosed therein;
and the other financial and statistical information and data included
in the Registration Statement or the Prospectus (or any amendment or
supplement thereto) are accurately derived from such financial
statements and the books and records of the Fund.
(k) The Fund, subject to the Registration Statement
having been declared effective and the filing of the Prospectus under
Rule 497 under the 1933 Act Rules and Regulations, has taken all action
required to be taken by it under the 1933 Act, the 1940 Act and the
Rules and Regulations to make the public offering and consummate the
sale of the Shares as contemplated by this Agreement.
(l) The execution and delivery of and the performance by
the Fund of its obligations under this Agreement and the Fund
Agreements have been duly and validly authorized by the Fund and this
Agreement and each of the Fund Agreements have been duly executed and
delivered by the Fund and (assuming due and valid authorization,
execution and delivery by the other parties hereto and thereto) this
Agreement and each Fund Agreement constitutes the valid and legally
binding agreement of the Fund, enforceable against the Fund in
accordance with its terms, except as rights to indemnity and
contribution hereunder may be limited by federal or state securities
laws and subject to the qualification that the enforceability of the
Fund's obligations hereunder and thereunder may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium and other laws relating to or affecting creditors' rights
generally and by general equitable principles (regardless of whether
enforcement is sought in a proceeding in equity or at law).
(m) Except as disclosed in or contemplated by the
Registration Statement or the Prospectus (or any amendment or
supplement to either of them), subsequent to the respective
9
dates as of which such information is given in the Registration
Statement and the Prospectus (and any amendment or supplement to either
of them), the Fund has not incurred any debt, liability or obligation,
direct or contingent, and there has not been any change in the capital
stock or capitalization of the Fund.
(n) The Fund has not distributed and, prior to the later
to occur of (i) the Closing Date and (ii) completion of the
distribution of the Shares, will not distribute to the public any
offering material in connection with the offering and sale of the
Shares other than the Registration Statement, the Prepricing Prospectus
and the Prospectus.
(o) (i) The Fund has such licenses, permits, and
authorizations of governmental or regulatory authorities ("permits") as
are necessary to own its property and to conduct its business in the
manner described in the Prospectus (and any amendment or supplement
thereto); (ii) the Fund has fulfilled and performed all its obligations
with respect to such permits and no event has occurred which allows or,
after notice or lapse of time, would allow, revocation or termination
thereof or results in any other impairment of the rights of the Fund
under any such permit, subject in each case to such qualification as
may be set forth in the Prospectus (and any amendment or supplement
thereto); and, (iii) except as described in the Prospectus (and any
amendment or supplement thereto), none of such permits contains any
restriction that is materially burdensome to the Fund; except where the
failure to obtain or perform its obligations with respect to such
permits, or the restrictions set forth in such permits, as set forth in
clauses (i), (ii) and (iii), either individually or in the aggregate,
does or would not have a Material Adverse Effect on the Fund.
(p) The Fund will maintain a system of internal
accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with the Board of Trustees'
general or specific authorization and with the investment policies and
restrictions of the Fund and the applicable requirements of the 1940
Act, the 1940 Act Rules and Regulations and the Internal Revenue Code
of 1986, as amended (the "Code"); (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity
with generally accepted accounting principles, to calculate net asset
value and fee accruals, to maintain accountability for assets and to
maintain compliance with the books and records requirements under the
1940 Act and the 1940 Act Rules and Regulations; (iii) access to assets
is permitted only in accordance with the Board of Trustees' general or
specific authorization; and (iv) the recorded account for assets is
compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(q) The conduct by the Fund of its business (as described
in the Prospectus) does not require it to be the owner, possessor,
licensee of, or otherwise require it to have the right to use, any
patents, patent licenses, trademarks, service marks or trade names
(collectively, "Intellectual Property") which it does not own, possess,
license or otherwise have the right to use, except where the failure to
own, possess, license or otherwise have the right to use such
Intellectual Property, individually or in the aggregate, does or would
not have a Material Adverse Effect on the Fund. The Fund does not own
any Intellectual Property concerning the name "ING Clarion."
(r) The Fund is duly registered under the 1940 Act and
the Rules and Regulations as a closed-end, non-diversified management
investment company and the 1940 Act Notification has been duly filed
with the Commission and, at the time of filing thereof and at all times
through the date hereof, the 1940 Act Notification conformed in all
material respects with all applicable provisions of the 1940 Act and
the Rules and Regulations; no order of suspension or revocation of such
registration under the 1940 Act and the Rules and Regulations has been
issued or proceedings therefor initiated or, to the knowledge of the
Fund, threatened by the Commission.
10
The provisions of the Declaration, and the investment policies and
restrictions described in each of the Registration Statement and the
Prospectus, comply in all material respects with the requirements of
the 1940 Act and the Rules and Regulations.
(s) Each of the Fund Agreements complies in all material
respects with all applicable provisions of the 1933 Act, the 1940 Act,
the Rules and Regulations, the Investment Advisers Act of 1940, as
amended (the "Advisers Act"), and the rules and regulations of the
Commission promulgated under the Advisers Act (the "Advisers Act Rules
and Regulations").
(t) No holder of any security of the Fund has any right
to require registration of any Shares, capital stock or any other
security of the Fund because of the filing of the registration
statement or consummation of the transactions contemplated by this
Agreement.
(u) The Fund, the Adviser and the Sub-Adviser intend to
direct the investment of the proceeds of the offering of the Shares in
such a manner as to comply with the requirements of Subchapter M of the
Code.
(v) The Commission has not issued any order preventing or
suspending the use of any Prepricing Prospectus or the Prospectus.
(w) Except as disclosed in the Registration Statement or
the Prospectus (or any amendment or supplement to either of them), to
the Fund's knowledge, after due inquiry, no trustee of the Fund is an
"interested person" (as defined in the ▇▇▇▇ ▇▇▇) of the Fund or an
"affiliated person" (as defined in the ▇▇▇▇ ▇▇▇) of any Underwriter
listed in Schedule I hereto.
(x) The Common Shares are listed on the AMEX.
7. Representations and Warranties of the Adviser. The Adviser
represents and warrants to each Underwriter as follows:
(a) The Adviser is a limited partnership duly formed and
validly existing in good standing under the laws of the State of
Delaware, with full corporate power and authority to own, lease and
operate its properties and to conduct its business as described in each
of the Registration Statement and the Prospectus (or any amendment or
supplement to either of them) and is duly registered and qualified to
conduct business and is in good standing in each jurisdiction or place
where the nature of its properties or conduct of its business requires
such registration or qualification, except where the failure so to
register or to qualify does or would not have a Material Adverse Effect
on the Adviser.
(b) The Adviser is duly registered with the Commission as
an investment adviser under the Advisers Act and is not prohibited by
the Advisers Act, the 1940 Act, the Advisers Act Rules and Regulations
or the 1940 Act Rules and Regulations from acting under the Management
Agreement for the Fund as contemplated by the Registration Statement or
the Prospectus (or any amendment or supplement to either of them).
There does not exist any proceeding which, if determined adversely with
respect to the Adviser, does or would have a material and adverse
effect on the registration of the Adviser with the Commission.
(c) There are no legal or governmental proceedings
pending or, to the knowledge of the Adviser, threatened against the
Adviser that are required to be described in the Registration Statement
or the Prospectus (or any amendment or supplement to either of them)
but are not described as required or that, if determined adversely with
respect to the Adviser, does or would
11
have a Material Adverse Effect on the Adviser or does or would have a
material and adverse effect on the ability of the Adviser to perform
its obligations under this Agreement or any of the Adviser Agreements.
(d) Neither the execution, delivery or performance of
this Agreement or any of the Adviser Agreements, nor the consummation
by the Adviser of the transactions contemplated hereby or thereby (i)
requires the Adviser to obtain any consent, approval, authorization or
other order of, or registration or filing with, the Commission, any
state securities commission, any national securities exchange, any
arbitrator, any court, regulatory body, administrative agency or other
governmental body, agency or official having jurisdiction over the
Adviser or conflicts or will conflict with or constitutes or will
constitute a breach of or a default under, the certificate of
incorporation or bylaws, or other organizational documents of the
Adviser or (ii) conflicts or will conflict with or constitutes or will
constitute a breach of or a default under, any agreement, indenture,
lease or other instrument to which the Adviser is a party or by which
the Adviser or any of its properties may be bound, or violates or will
violate any statute, law, regulation or judgment, injunction, order or
decree applicable to the Adviser or any of its properties or will
result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Adviser pursuant to the terms of any
agreement or instrument to which it is a party or by which it may be
bound or to which any of the property or assets of the Adviser is
subject, except in any case under clause (i) or (ii) as does or would
not have a Material Adverse Effect on the Adviser or does or would have
a material and adverse effect on the ability of the Adviser to perform
its obligations under this Agreement or any of the Adviser Agreements.
The Adviser is not subject to any order of any court or of any
arbitrator, regulatory body, administrative agency or other
governmental body, agency or official that would have a Material
Adverse Effect on the Adviser or does or would have a material and
adverse effect on the ability of the Adviser to perform its obligations
under this Agreement or any of the Adviser Agreements.
(e) The Adviser has full power and authority to enter
into this Agreement and each of the Adviser Agreements; the execution
and delivery of and the performance by the Adviser of its obligations
under this Agreement and the Adviser Agreements have been duly and
validly authorized by the Adviser; and this Agreement and each of the
Adviser Agreements have been duly executed and delivered by the Adviser
and (assuming due and valid authorization, execution and delivery by
the other parties hereto and thereto) this Agreement and each Adviser
Agreement constitutes the valid and legally binding agreement of the
Adviser, enforceable against the Adviser in accordance with its terms,
except as rights to indemnity and contribution hereunder may be limited
by federal or state securities laws and subject to the qualification
that the enforceability of the Adviser's obligations hereunder and
thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium and other laws relating to or
affecting creditors' rights generally and by general equitable
principles (regardless of whether enforcement is sought in a proceeding
in equity or at law).
(f) The Adviser has the financial resources necessary for
the performance of its services and obligations as contemplated in the
Registration Statement and the Prospectus (or any amendment or
supplement to either of them) or under this Agreement or any of the
Adviser Agreements.
(g) The description of the Adviser in the Registration
Statement and the Prospectus (or any amendment or supplement to either
of them) complied and comply in all material respects with the
provisions of the 1933 Act, the 1940 Act, the Advisers Act, the Rules
and Regulations and the Advisers Act Rules and Regulations; and such
description and the statements attributable to the Adviser in the
Registration Statement and the Prospectus (or any amendment or
supplement
12
to either of them) did not and will not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein (in the case of the
Prospectus, in light of the circumstances under which they were made)
not misleading.
(h) Since the date as of which information is given in
the Registration Statement or the Prospectus (or any amendment or
supplement to either of them), except as otherwise stated therein,
there has been no material adverse change in the condition (financial
or other), business, properties, net assets or results of operations or
business prospects of the Adviser, whether or not arising from the
ordinary course of business that does or would have a Material Adverse
Effect on the Adviser or does or would have a material and adverse
effect on the ability of the Adviser to perform its obligations under
this Agreement or any of the Adviser Agreements.
(i) (i) The Adviser has such licenses, permits, and
authorizations of governmental or regulatory authorities ("permits") as
are necessary to own its property and to conduct its business in the
manner described in the Prospectus (and any amendment or supplement
thereto); (ii) the Adviser has fulfilled and performed all its
obligations with respect to such permits and no event has occurred
which allows or, after notice or lapse of time, would allow, revocation
or termination thereof or results in any other impairment of the rights
of the Adviser under any such permit, subject in each case to such
qualification as may be set forth in the Prospectus (and any amendment
or supplement thereto); and, (iii) except as described in the
Prospectus (and any amendment or supplement thereto), none of such
permits contains any restriction that is materially burdensome to the
Adviser; except where the failure to obtain or perform its obligations
with respect to such permits, or the restrictions set forth in such
permits, as set forth in clauses (i), (ii) and (iii), either
individually or in the aggregate, does or would have a Material Adverse
Effect on the Adviser or does or would have a material and adverse
effect on the ability of the Adviser to perform its obligations under
this Agreement or any of the Adviser Agreements.
(j) Each of the Adviser Agreements comply in all material
respects with the applicable provisions of the 1940 Act, the 1940 Act
Rules and Regulations, the Advisers Act and the Advisers Act Rules and
Regulations.
8. Representations and Warranties of the Sub-Adviser. The
Sub-Adviser represents and warrants to each Underwriter as follows:
(a) The Sub-Adviser is a limited liability company duly
formed and validly existing in good standing under the laws of the
State of Delaware, with full limited liability company power and
authority to own, lease and operate its properties and to conduct its
business as described in each of the Registration Statement and the
Prospectus (or any amendment or supplement to either of them) and is
duly registered and qualified to conduct business and is in good
standing in each jurisdiction or place where the nature of its
properties or conduct of its business requires such registration or
qualification, except where the failure so to register or to qualify
does or would not have a Material Adverse Effect on the Sub-Adviser.
(b) The Sub-Adviser is duly registered with the
Commission as an investment adviser under the Advisers Act and is not
prohibited by the Advisers Act, the 1940 Act, the Advisers Act Rules
and Regulations or the 1940 Act Rules and Regulations from acting under
this Agreement or the Sub-Advisory Agreement for the Fund as
contemplated by the Registration Statement or the Prospectus (or any
amendment or supplement to either of them). There does not exist any
proceeding which, if determined adversely with respect to the
Sub-Adviser, does or
13
would have a material and adverse effect on the registration of the
Sub-Adviser with the Commission.
(c) There are no legal or governmental proceedings
pending or, to the knowledge of the Sub-Adviser, threatened against the
Sub-Adviser that are required to be described in the Registration
Statement or the Prospectus (or any amendment or supplement to either
of them) but are not described as required or that, if determined
adversely with respect to the Sub-Adviser, does or would have a
Material Adverse Effect on the Sub-Adviser or does or would have a
material and adverse effect on the ability of the Sub-Adviser to
perform its obligations under this Agreement or the Sub-Advisory
Agreement.
(d) Neither the execution, delivery or performance of
this Agreement or the Sub-Advisory Agreement, nor the consummation by
the Sub-Adviser of the transactions contemplated hereby or thereby (i)
requires the Sub-Adviser to obtain any consent, approval, authorization
or other order of, or registration or filing with, the Commission, any
state securities commission, any national securities exchange, any
arbitrator, any court, regulatory body, administrative agency or other
governmental body, agency or official having jurisdiction over the
Sub-Adviser or conflicts or will conflict with or constitutes or will
constitute a breach of or a default under, the certificate of
incorporation or bylaws, or other organizational documents of the
Sub-Adviser or (ii) conflicts or will conflict with or constitutes or
will constitute a breach of or a default under, any agreement,
indenture, lease or other instrument to which the Sub-Adviser is a
party or by which the Sub-Adviser or any of its properties may be
bound, or violates or will violate any statute, law, regulation or
judgment, injunction, order or decree applicable to the Sub-Adviser or
any of its properties or will result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the
Sub-Adviser pursuant to the terms of any agreement or instrument to
which it is a party or by which it may be bound or to which any of the
property or assets of the Sub-Adviser is subject, except in any case
under clause (i) or (ii) as would not have a Material Adverse Effect on
the Sub-Adviser or on the ability of the Sub-Adviser to perform its
obligations under this Agreement or the Sub-Advisory Agreement. The
Sub-Adviser is not subject to any order of any court or of any
arbitrator, regulatory body, administrative agency or other
governmental body, agency or official that does or would have a
Material Adverse Effect on the Sub-Adviser or does or would have a
material and adverse effect on the ability of the Sub-Adviser to
perform its obligations under this Agreement or the Sub-Advisory
Agreement.
(e) The Sub-Adviser has full power and authority to enter
into this Agreement and the Sub-Advisory Agreement; the execution and
delivery of and the performance by the Sub-Adviser of its obligations
under this Agreement and the Sub-Advisory Agreement have been duly and
validly authorized by the Sub-Adviser; and this Agreement and the
Sub-Advisory Agreement have been duly executed and delivered by the
Sub-Adviser and (assuming due and valid authorization, execution and
delivery by the other parties hereto and thereto) this Agreement and
the Sub-Advisory Agreement constitutes the valid and legally binding
agreement of the Sub-Adviser, enforceable against the Sub-Adviser in
accordance with its terms, except as rights to indemnity and
contribution hereunder may be limited by federal or state securities
laws and subject to the qualification that the enforceability of the
Sub-Adviser's obligations hereunder and thereunder may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium and other laws relating to or affecting creditors' rights
generally and by general equitable principles (regardless of whether
enforcement is sought in a proceeding in equity or at law).
(f) The Sub-Adviser has the financial resources necessary
for the performance of its services and obligations as contemplated in
the Registration Statement and the Prospectus (or any
14
amendment or supplement to either of them) or under this Agreement and
the Sub-Advisory Agreement.
(g) The description of the Sub-Adviser in the
Registration Statement and the Prospectus (or any amendment or
supplement to either of them) complied and comply in all material
respects with the provisions of the 1933 Act, the 1940 Act, the
Advisers Act, the Rules and Regulations and the Advisers Act Rules and
Regulations; and such description and the statements attributable to
the Sub-Adviser in the Registration Statement and the Prospectus (or
any amendment or supplement to either of them) did not and will not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading.
(h) Since the date as of which information is given in
the Registration Statement or the Prospectus (or any amendment or
supplement to either of them), except as otherwise stated therein,
there has been no material adverse change in the condition (financial
or other), business, properties, net assets or results of operations or
business prospects of the Sub-Adviser, whether or not arising from the
ordinary course of business that does or would have a Material Adverse
Effect on the Sub-Adviser or does or would have a material and adverse
effect on the ability of the Sub-Adviser to perform its obligations
under this Agreement or the Sub-Advisory Agreement.
(i) (i) The Sub-Adviser has such licenses, permits, and
authorizations of governmental or regulatory authorities ("permits") as
are necessary to own its property and to conduct its business in the
manner described in the Prospectus (and any amendment or supplement
thereto); (ii) the Sub-Adviser has fulfilled and performed all its
obligations with respect to such permits and no event has occurred
which allows or, after notice or lapse of time, would allow, revocation
or termination thereof or results in any other impairment of the rights
of the Sub-Adviser under any such permit, subject in each case to such
qualification as may be set forth in the Prospectus (and any amendment
or supplement thereto); and, (iii) except as described in the
Prospectus (and any amendment or supplement thereto), none of such
permits contains any restriction that is materially burdensome to the
Sub-Adviser; except where the failure to obtain or perform its
obligations with respect to such permits, or the restrictions set forth
in such permits, as set forth in clauses (i), (ii) and (iii), either
individually or in the aggregate, does or would have a Material Adverse
Effect on the Sub-Adviser or does or would have a material and adverse
effect on the ability of the Sub-Adviser to perform its obligations
under this Agreement or the Sub-Advisory Agreement.
(j) The Sub-Advisory Agreement complies in all material
respects with the applicable provisions of the 1940 Act, the 1940 Act
Rules and Regulations, the Advisers Act and the Advisers Act Rules and
Regulations.
9. Indemnification and Contribution.
(a) The Fund, the Adviser and the Sub-Adviser, jointly
and severally, agree to indemnify and hold harmless each of you and
each other Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act, from and against any and all losses, claims,
damages, liabilities and expenses, joint or several (including
reasonable costs of investigation), arising out of or based upon any
untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, the Prospectus, any Prepricing
Prospectus (or any amendment or supplement to any of the foregoing) or
arising out of or based upon any omission or alleged omission to state
therein a
15
material fact required to be stated therein or necessary to make the
statements therein (in the case of a prospectus, in light of the
circumstances under which they were made) not misleading, (except
insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged
untrue statement or omission which has been made therein or omitted
therefrom in reliance upon and in conformity with the Underwriter
Information); provided, however, that the foregoing indemnification
contained in this paragraph (a) with respect to the Prepricing
Prospectus (or any amendment or supplement thereto) shall not inure to
the benefit of any Underwriter (or to the benefit of any person
controlling such Underwriter) on account of any such loss, claim,
damage, liability or expense arising from the sale of the Shares by
such Underwriter to any person if it is shown that a copy of any such
amendment or supplement to the Prepricing Prospectus or of the
Prospectus (which term as used in this proviso shall not include any
statement of additional information unless specifically requested by
such person) was not delivered or sent to such person within the time
required by the 1933 Act and the 1933 Act Rules and Regulations and the
untrue statement or alleged untrue statement or omission or alleged
omission of a material fact contained in the Prepricing Prospectus was
corrected in the supplement or amendment to the Prepricing Prospectus
or in the Prospectus, provided that the Fund has delivered such
supplements or amendments or the Prospectus to the several Underwriters
in requisite quantity on a timely basis to permit proper delivery or
sending. The foregoing indemnity agreement shall be in addition to any
liability which the Fund, the Adviser or the Sub-Adviser may otherwise
have.
(b) If any action, suit or proceeding shall be brought
against any Underwriter or any person controlling any Underwriter in
respect of which indemnity may be sought against the Fund, the Adviser
or the Sub-Adviser, such Underwriter or such controlling person shall
promptly notify the Fund, the Adviser or the Sub-Adviser and the Fund,
the Adviser or the Sub-Adviser shall assume the defense thereof,
including the employment of counsel and the payment of all fees and
expenses. Such Underwriter or any such controlling person shall have
the right to employ separate counsel in any such action, suit or
proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Underwriter or
controlling person unless (i) the Fund, the Adviser or the Sub-Adviser
have agreed in writing to pay such fees and expenses, (ii) the Fund,
the Adviser or the Sub-Adviser have failed within a reasonable time to
assume the defense and employ counsel or (iii) the named parties to any
such action, suit or proceeding (including any impleaded parties)
include both such Underwriter or such controlling person and the Fund,
the Adviser or the Sub-Adviser and such Underwriter or such controlling
person shall have been advised by its counsel that representation of
such indemnified party and the Fund, the Adviser or the Sub-Adviser by
the same counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same
counsel has been proposed) due to actual or potential differing
interests between them (in which case the Fund, the Adviser and the
Sub-Adviser shall not have the right to assume the defense of such
action, suit or proceeding on behalf of such Underwriter or such
controlling person). It is understood, however, that the Fund, the
Adviser and the Sub-Adviser shall, in connection with any one such
action, suit or proceeding or separate but substantially similar or
related actions, suits or proceedings in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of only one separate firm of attorneys (in
addition to any local counsel if there is any action, suit or
proceeding in more than one jurisdiction) at any time for all such
Underwriters and controlling persons not having actual or potential
differing interests with you or among themselves, which firm shall be
designated in writing by the Representative and that, subject to the
requirements of 1940 Act Release No. 11330 and Section 17(i) of the
1940 Act, all such fees and expenses shall be reimbursed promptly as
they are incurred. The Fund, the Adviser and the Sub-Adviser shall not
be liable for any settlement of any such action, suit or proceeding
effected without the written
16
consent of the Fund, the Adviser or the Sub-Adviser (whether or not the
fund, the Adviser or the Sub-Adviser are actual or potential parties to
such action, suit or proceeding), but if settled with such written
consent or if there be a final judgment for the plaintiff in any such
action, suit or proceeding, the Fund, the Adviser and the Sub-Adviser
agree to indemnify and hold harmless any Underwriter, to the extent
provided in the preceding paragraph and any such controlling person
from and against any loss, liability, damage or expense by reason by
such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly,
to indemnify and hold harmless the Fund, the Adviser and the
Sub-Adviser, their directors, trustees, members or managers, any
officers of the Fund who sign the Registration Statement and any person
who controls the Fund, the Adviser or the Sub-Adviser within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, to
the same extent as the foregoing indemnity from the Fund, the Adviser
and the Sub-Adviser to each Underwriter, but only with respect to the
Underwriter Information relating to such Underwriter. If any action,
suit or proceeding shall be brought against the Fund, the Adviser or
the Sub-Adviser, any of their directors, trustees, members or managers,
any such officer or any such controlling person, based on the
Registration Statement, the Prospectus or any Prepricing Prospectus (or
any amendment or supplement thereto) and in respect of which indemnity
may be sought against any Underwriter pursuant to this paragraph (c),
such Underwriter shall have the rights and duties given to each of the
Fund, the Adviser and the Sub-Adviser by paragraph (b) above (except
that if the Fund, the Adviser or the Sub-Adviser shall have assumed the
defense thereof such Underwriter shall not be required to do so, but
may employ separate counsel therein and participate in the defense
thereof, but the fees and expenses of such counsel shall be at such
Underwriter's expense) and the Fund, the Adviser and the Sub-Adviser,
their directors, trustees, managers or members, any such officer and
any such controlling person shall have the rights and duties given to
the Underwriters by paragraph (b) above. The foregoing indemnity
agreement shall be in addition to any liability which the Underwriters
may otherwise have.
(d) If the indemnification provided for in this Section 9
is unavailable to an indemnified party under paragraphs (a) or (c)
hereof in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then an indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the Fund, the
Adviser and the Sub-Adviser on the one hand (treated jointly for this
purpose as one person) and the Underwriters on the other from the
offering of the Shares or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Fund, the Adviser
and the Sub-Adviser on the one hand (treated jointly for this purpose
as one person) and of the Underwriters on the other in connection with
the statements or omissions which resulted in such losses, claims,
damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Fund,
the Adviser and the Sub-Adviser on the one hand (treated jointly for
this purpose as one person) and the Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from the
offering (before deducting expenses) received by the Fund bear to the
total underwriting discounts and commissions received by the
Underwriters, in each case, as set forth in the table on the cover page
of the Prospectus. The Fund and the Advisers agree that as between the
Fund, the Adviser and the Sub-Adviser (and solely for the purpose of
allocating among such parties the total amount to be contributed by
each of them to one another and without prejudice to the right of the
Underwriters to receive contributions from the Fund and the Advisers
under this Section 8(d) on a joint and several basis) the relative
benefits received by the Fund, on the one hand, and the Adviser and
17
Sub-Adviser, on the other hand, shall be deemed to be in the same
proportion that the total net proceeds from the offering (before
deducting expenses) received by the Fund bear to the present value of
the future revenue stream to be generated by the advisory fee to be
paid by the Fund to the Adviser pursuant to the Management Agreement.
The relative fault of the Fund, the Adviser and the Sub-Adviser on the
one hand (treated jointly for this purpose as one person) and of the
Underwriters on the other shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information supplied by the Fund, the Adviser and the
Sub-Adviser on the one hand (treated jointly for this purpose as one
person) or by the Underwriters on the other and the parties' relative
intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
(e) The Fund, the Adviser, the Sub-Adviser and the
Underwriters agree that it would not be just and equitable if
contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (d)
above. The amount paid or payable by an indemnified party as a result
of the losses, claims, damages, liabilities and expenses referred to in
paragraph (d) above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating any
claim or defending any such action, suit or proceeding. Notwithstanding
the provisions of this Section 9, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price
of the Shares underwritten by it and distributed to the public exceeds
the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇)
shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 9 are several in proportion to the
respective number of Shares set forth opposite their names in Schedule
I (or such number of Shares increased as set forth in Section 11
hereof) and not joint.
(f) No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any
pending or threatened action, suit or proceeding in respect of which
any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party
from all liability from claimants on claims that are the subject matter
of such action, suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses
for which an indemnified party is entitled to indemnification or
contribution under this Section 9 shall, subject to the requirements of
Release No. 11330 and Section 17(i) of the 1940 Act, be paid by the
indemnifying party to the indemnified party as such losses, claims,
damages, liabilities or expenses are incurred. The indemnity and
contribution agreements contained in this Section 9 and the
representations and warranties of each of the Fund, the Adviser and the
Sub-Adviser set forth in this Agreement shall remain operative and in
full force and effect, regardless of (i) any investigation made by or
on behalf of any Underwriter or any person controlling any Underwriter,
the Fund, the Adviser, the Sub-Adviser or their directors, trustees,
managers, members, officers or any person controlling the Fund, the
Adviser or the Sub-Adviser, (ii) acceptance of any Shares and payment
therefor hereunder and (iii) any termination of this Agreement. A
successor to any Underwriter or to the Fund, the Adviser or the
Sub-Adviser or their directors, managers, members, officers or any
person controlling the Fund, the Adviser or the Sub-Adviser shall be
18
entitled to the benefits of the indemnity, contribution and
reimbursement agreements contained in this Section 9.
(h) The Fund, the Adviser and the Sub-Adviser each
acknowledge, and the Underwriters severally confirm, that the
statements in the Prospectus with respect to (1) the "[Price to
Public]" of the Shares as set forth on the cover page of the Prospectus
and (2) the information under the caption "Underwriting" in the
Prospectus constitute the only Underwriter Information. The
Underwriters severally confirm that these statements are correct in all
material respects and were so furnished by or on behalf of the
Underwriters severally for use in the Prospectus.
(i) The indemnification provisions of this Section 9 that
are applicable to the Fund are subject to any applicable limitations
and provisions of Section 17(i) of the 1940 Act.
10. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase the Shares hereunder are subject to
the accuracy of and compliance with the representations, warranties and
agreements of and by each of the Fund, the Adviser and the Sub-Adviser contained
herein on and as of the date on which the Registration Statement becomes or
became effective, the date of the Prospectus (and of any amendment or supplement
thereto) and the Closing Date (each, a "Condition Compliance Date" and
collectively, the "Condition Compliance Dates"); to the accuracy and
completeness of all statements made by the Fund, the Adviser, the Sub-Adviser or
any of their respective officers in any certificate delivered to the
Representative or its counsel pursuant to this Agreement on any Condition
Compliance Date, and to the following conditions (each of which shall be
satisfied as of each of the Condition Compliance Dates):
(a) If, at the time this Agreement is executed and
delivered, it is necessary for the Registration Statement or a
post-effective amendment thereto to be declared effective before the
offering of the Shares may commence, the Registration Statement or such
post-effective amendment shall have become effective not later than
5:30 p.m., New York City time, on the date hereof or at such later date
and time as shall be consented to in writing by you and all filings, if
any, required by Rules 497 and 430A under the 1933 Act and the 1933 Act
Rules and Regulations shall have been timely made; no order pursuant to
Section 8(e) of the 1940 Act shall have been issued and no proceeding
for that purpose shall have been instituted or, to the knowledge of the
Fund, the Adviser or any Underwriter, threatened by the Commission and
any request of the Commission for additional information (to be
included in the Registration Statement or the Prospectus or otherwise)
shall have been complied with to your satisfaction.
(b) Subsequent to the effective date of this Agreement,
there shall not have occurred (i) any change or any development
involving a prospective change that does or would have a Material
Adverse Effect on the Fund, the Adviser or the Sub-Adviser (in each
case not contemplated by the Prospectus or (ii) any event or
development relating to or involving the Fund, the Adviser or the
Sub-Adviser which makes any statement made in the Prospectus untrue or
which, in the opinion of the Fund and its counsel or the Underwriters
and their counsel, requires the making of any addition to or change in
the Prospectus in order to state a material fact required by the 1933
Act, the 1940 Act or the Rules and Regulations or any other law to be
stated therein or necessary in order to make the statements therein not
misleading, if amending or supplementing the Prospectus to reflect such
event or development would, in your opinion, make it impracticable or
inadvisable to continue with the offering of the Shares.
(c) That you shall have received on the Closing Date an
opinion of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the
Fund, dated the Closing Date and addressed to you,
19
as the Representatives of the several Underwriters, in substantially
the form attached hereto as Exhibit A.
(d) That you shall have received on the Closing Date an
opinion of ▇▇▇▇▇ ▇▇▇▇ LLP, counsel for the Adviser, dated the Closing
Date and addressed to you, as Representative of the several
Underwriters, in substantially the form attached hereto as Exhibit B.
(e) That you shall have received on the Closing Date an
Opinion of ▇▇▇▇▇ ▇▇▇▇ LLP, counsel for the Sub-Adviser, dated the
Closing Date and addressed to you, as the Representative of the several
Underwriters, in substantially the form attached hereto as Exhibit C.
(f) That you shall have received on the Closing Date (i)
an opinion of ▇▇▇▇▇▇▇▇ Chance US LLP dated the Closing Date and
addressed to you, as the Representative of the several Underwriters,
with respect to such matters as you may require, and the Fund, the
Adviser, the Sub-Adviser and their respective counsel shall have
furnished to such counsel such documents as they may request for the
purpose of enabling them to pass upon such matters.
(g) That you shall have received letters addressed to
you, as the Representatives of the several Underwriters and dated each
of the date hereof and the Closing Date, from Ernst & Young LLP,
independent auditors, substantially in the forms attached hereto as
Exhibit D. You also must receive on the Closing Date a signed letter
from such accountants, dated as of the Closing Date, confirming on the
basis of a review in accordance with the procedures set forth in their
letter that nothing has come to their attention during the period from
a date not more than five business days before the date of this
Underwriting Agreement, specified in the letter, to a date not more
than five business days before the Closing Date, that would require any
change in their letter referred to in the foregoing sentence.
(h) (i) No stop order suspending the effectiveness of the
Registration Statement or prohibiting or suspending the use of the
Prospectus (or any amendment or supplement to any of the foregoing) or
any Prepricing Prospectus shall have been issued and no proceedings for
such purpose or for the purpose of commencing an enforcement action
against the Fund, the Adviser or the Sub-Adviser or, with respect to
the transactions contemplated by the Prospectus (or any amendment or
supplement thereto) and this Agreement, may be pending before or, to
the knowledge of the Fund, the Adviser, the Sub-Adviser or any
Underwriter or in the reasonable view of counsel to the Underwriters,
shall be threatened or contemplated by the Commission at or prior to
the Closing Date and that any request for additional information on the
part of the Commission (to be included in the Registration Statement,
the Prospectus or otherwise) be complied with to the satisfaction of
the Representative, (ii) there shall not have been any change in the
capital stock of the Fund nor any increase in debt of the Fund from
that set forth in the Registration Statement or the Prospectus (or any
amendment or supplement to either of them) and the Fund shall not have
sustained any material liabilities or obligations, direct or
contingent, other than those reflected in or contemplated by the
Registration Statement or the Prospectus (or any amendment or
supplement to either of them), (iii) since the date of the Prospectus
there shall not have been any material, adverse change in the condition
(financial or other) business, business prospects, properties, net
assets or results of operations of the Fund, the Adviser or the
Sub-Adviser, (iv) none of the Fund, the Adviser or the Sub-Adviser
shall have sustained any material loss or interference with their
businesses from any court or from legislative or other governmental
action, order or decree or from any other occurrence not described in
the Registration Statement or the Prospectus (or any amendment or
supplement to either of them), and (v) all of the representations and
warranties of each of the Fund, the Adviser or the Sub-Adviser
contained in
20
this Agreement shall be true and correct on and as of the date hereof
and as of the respective Condition Compliance Date as if made on and as
of such Condition Compliance Date.
(i) That none of the Fund, the Adviser, or the
Sub-Adviser shall have failed at or prior to the respective Condition
Compliance Date to have performed or complied with any of the
agreements herein contained and required to be performed or complied
with by them at or prior to the such Condition Compliance Date.
(j) The Shares shall have been accorded a rating of "Aaa"
by ▇▇▇▇▇'▇ Investors Service, Inc. and "AAA" by Fitch Ratings, and
letters and/or press releases to such effect, dated on or before the
Closing Date, shall have been delivered to the Representative.
(k) As of the Closing Date, and assuming receipt of the
net proceeds from the sale of the Shares, the 1940 Act Preferred Shares
Asset Coverage and the Preferred Shares Basic Maintenance Amount (each
as defined in the Statement of Preferences establishing the Shares)
each will be met and a certificate to such effect, signed by an officer
of the Fund, shall have been delivered to the Representative.
(l) That you shall have received on the Closing Date a
certificate, dated such date, of each of the chief executive officer
and chief financial officer of the Fund, and of the President (or a
Vice President or Managing Director) and Treasurer (or an Assistant
Treasurer) of each of the Adviser and the Sub-Adviser certifying that
(i) the signers have carefully examined the Registration Statement, the
Prospectus (and any amendments or supplements to either of them) and
this Agreement, (ii) the representations and warranties of the Fund
(with respect to the certificates from such Fund officers), the
representations and warranties of the Adviser (with respect to the
certificates from such officers of the Adviser), and the
representations and warranties of the Sub-Adviser (with respect to the
certificates from such officers of the Sub-Adviser) in this Agreement
are true and correct on and as of the date of the certificate as if
made on such date, (iii) since the date of the Prospectus (and any
amendment or supplement thereto) there has not been any change that
does or would have a Material Adverse Effect on the Fund (with respect
to the certificates from such Fund officers) or the Adviser (with
respect to the certificates from such officers of the Adviser) or the
Sub-Adviser (with respect to the certificates from such officers of the
Sub-Adviser), (iv) to the knowledge of such officers after reasonable
investigation, no order suspending the effectiveness of the
Registration Statement or prohibiting the sale of any of the Shares or
having a Material Adverse Effect on the Fund (with respect to the
certificates from such Fund officers) or the Adviser (with respect to
the certificates from such officers of the Adviser) or the Sub-Adviser
(with respect to the certificates from such officers of the
Sub-Adviser) has been issued and no proceedings for any such purpose
are pending before or, to the knowledge of such officers, threatened by
the Commission or any court or other regulatory body, any state
securities commission, any national securities exchange, any
arbitrator, any court or any other governmental, regulatory,
self-regulatory or administrative agency or any official, (v) each of
the Fund (with respect to certificates from such Fund officers), the
Adviser (with respect to certificates from such officers of the
Adviser) and the Sub-Adviser(with respect to the certificates from such
officers of the Sub-Adviser) has performed and complied with all
agreements that this Agreement require it to perform by such Closing
Date and (vi) with respect to the certificate from such officers of the
Fund, there has not been any change in the capital stock of the Fund
nor any increase in the debt of the Fund from that set forth in the
Prospectus (or any amendment or supplement thereto) and the Fund has
not sustained any material liabilities or obligations, direct or
contingent, other than those reflected in the Prospectus (or any
amendment or supplement thereto).
21
(m) That the Fund, the Adviser and the Sub-Adviser shall
have furnished to you such further certificates and documents as you
shall reasonably request.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you and your counsel acting in good faith.
Any certificate or document signed by any officer of the Fund, the
Adviser or the Sub-Adviser and delivered to you, as the Representative of the
Underwriters or to Underwriters' counsel, shall be deemed a representation and
warranty by the Fund, the Adviser or the Sub-Adviser to each Underwriter as to
the statements made therein.
11. Effective Date of Agreement. This Agreement shall become
effective: (i) upon the execution and delivery hereof by the parties hereto; or
(ii) if, at the time this Agreement is executed and delivered, it is necessary
for the Registration Statement or a post-effective amendment thereto to be
declared effective before the offering of the Shares may commence, when the
Registration Statement or such post-effective amendment has become effective.
Until such time as this Agreement shall have become effective, it may be
terminated by the Fund by notifying you, or by you by notifying the Fund.
If any one or more of the Underwriters shall fail or refuse to purchase
Shares which it or they have agreed to purchase hereunder and the aggregate
number of Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares, each non-defaulting Underwriter shall be obligated, severally, in
the proportion which the aggregate number of Shares set forth opposite its name
in Schedule I hereby bears to the aggregate number of Shares set forth opposite
the names of all non-defaulting Underwriters or in such other proportion as you
may specify in accordance with Section 7 of the ▇.▇. ▇▇▇▇▇▇▇ Master Agreement
Among Underwriters, to purchase Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase. If any Underwriter or
Underwriters shall fail or refuse to purchase Shares and the aggregate number of
Shares with respect to which such default occurs is more than one-tenth of the
aggregate number of Shares and arrangements satisfactory to you and the Fund for
the purchase of such Shares by one or more non-defaulting Underwriters or other
party or parties approved by you and the Fund are not made within 36 hours after
such default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Fund, the Adviser or Sub-Adviser. In any such
case which does not result in termination of this Agreement, either you or the
Fund shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and the Prospectus or any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect to any such default of any such
Underwriter under this Agreement. The term "Underwriter" as used in this
Agreement includes, for all purposes of this Agreement, any party not listed in
Schedule I hereto who, with your approval and the approval of the Fund,
purchases Shares which a defaulting Underwriter agreed, but failed or refused,
to purchase.
Any notice under this Section 11 may be made by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
12. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Fund or the Adviser by notice to the Fund or the Adviser if
at any time at or prior to the Closing Date (i) trading in any securities of the
Fund has been suspended or materially limited by the Commission or the AMEX or
such other national securities exchange upon which the Fund's securities trade
or trading in securities generally on the New York Stock Exchange, American
Stock Exchange, Nasdaq National Market or the Nasdaq Stock Market
22
shall have been suspended or limited or minimum or maximum prices shall have
been established or required by such exchanges, the Commission, NASD or other
governmental authority, (ii) additional governmental restrictions not in force
on the date of this Agreement have been imposed upon trading in securities
generally or a general moratorium on commercial banking activities shall have
been declared by Federal or any state's authorities or (iii) there has occurred
any outbreak or material escalation of hostilities or other international or
domestic calamity, crisis or change or development in political, financial,
economic, legal or regulatory conditions or markets, the effect of which is such
as to make it, in your judgment, impracticable or inadvisable to commence or
continue the offering of the Shares at the offering price to the public set
forth on the cover page of the Prospectus or to enforce contracts for the resale
of the Shares by the Underwriters. Notice of such termination may be given to
the Fund, the Adviser or the Sub-Adviser by telegram, telecopy or telephone but
shall be subsequently confirmed by letter.
13. Expenses. The Fund agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance by the
Fund of its obligations hereunder: (a) the preparation, printing or
reproduction, filing (including, without limitation, the filing or registration
fees prescribed by the 1933 Act, the 1934 Act, the 1940 Act and the Rules and
Regulations) and distribution of the Registration Statement (including exhibits
thereto), the Prospectus, each Prepricing Prospectus and all amendments or
supplements to any of them, (b) the printing (or reproduction) and delivery to
the Underwriters (including postage, air freight charges and charges for
counting and packaging) of such copies of the Registration Statement, the
Prospectus, each Prepricing Prospectus (and all amendments or supplements to any
of them, except as provided in Section 5(f) of this Agreement) as may be
reasonably requested for use in connection with the offering and sale of the
Shares, (c) the preparation, printing, authentication, issuance and delivery of
certificates (if any) for the Shares, including any stamp taxes and transfer
agent and registrar fees payable in connection with the original issuance and
sale of such Shares, (d) the registrations or qualifications of the Shares for
offer and sale thereof, if any, as are required under the securities or Blue Sky
laws of the several states as provided in Section 5(g) hereof (including the
reasonable fees, expenses and disbursements of counsel for the Underwriters
relating to the preparation, printing or reproduction and delivery of the
preliminary and supplemental Blue Sky Memoranda and such registration and
qualification), (e) the fees and expenses of the Fund's independent accountants,
counsel for the Fund and of the transfer agent, (f) the printing (or
reproduction) and delivery of this Agreement, the preliminary and supplemental
Blue Sky Memoranda (if any) and all other company-authorized agreements or other
documents printed (or reproduced) and delivered in connection with the offering
of the Shares, (g) the fees charged by the securities rating agencies rating the
Shares, (h) the fees and expenses charged by the Depository Trust Company and
its nominee and (i) the fees and expenses charged by BONY, as Auction Agent with
respect to the Shares.
Notwithstanding the foregoing, in the event that the sale of the Shares
is not consummated pursuant to Section 2 hereof, the Adviser or the Sub-Adviser
will pay the costs and expenses of the Fund set forth above in this Section
13(a) through (i), and reimbursements of Underwriter expenses in connection with
the offering shall be made in accordance with Section 5(k) hereof.
14. Miscellaneous. Except as otherwise provided in Sections 5, 11
and 12 hereof, notice given pursuant to any provision of this Agreement shall be
in writing and shall be delivered (a) if to the Fund or the Adviser, ING Clarion
Real Estate Income Fund, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇; Attention: ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, with a copy to ▇▇▇▇▇▇▇ ▇▇▇▇,
Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq. (b) if to the Sub-Adviser, Clarion Capital LLC,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇; Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ (c) if to you,
as Representatives of the Underwriters, at the office of ▇.▇. ▇▇▇▇▇▇▇ & Sons,
Inc., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇,
23
with a copy to ▇▇▇▇▇▇▇▇ Chance US LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇,
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., Esq.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Fund, the Adviser, the Sub-Adviser, their directors,
officers, managers, members and the other controlling persons referred to in
Section 9 hereof and their respective successors and assigns, to the extent
provided herein and no other person shall acquire or have any right under or by
virtue of this Agreement. Neither the term "successor" nor the term "successors
and assigns" as used in this Agreement shall include a purchaser from any
Underwriter of any of the Shares in his status as such purchaser.
Notwithstanding any provision of this Agreement to the contrary
(including, without limitation, any specific reference to joint and several
obligations), the agreements, representations and warranties made by the
Sub-Adviser herein are made solely with respect to itself and information that
it has provided in writing for use in the registration statement, and not with
respect to the actions, knowledge or other matters of any other party hereto.
For the avoidance of doubt, the parties recognize that the Sub-Adviser's
authority with respect to the operations of the Fund is limited to that under
the Sub-Advisory Agreement.
15. Applicable Law; Counterparts. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
24
Please confirm that the foregoing correctly sets forth the agreement
among the Fund, the Adviser, the Sub-Adviser and the several Underwriters.
Very truly yours,
ING CLARION REAL ESTATE INCOME FUND
By: ____________________________________________
Name:
Title:
ING CLARION REAL ESTATE
SECURITIES, L.P.
By: ____________________________________________
Name:
Title:
CLARION CAPITAL LLC
By: ____________________________________________
Name:
Title:
25
Confirmed as of the date first above written on behalf of themselves and the
other several Underwriters named in Schedule I hereto.
AS REPRESENTATIVE OF THE SEVERAL UNDERWRITERS
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
By: _________________________________
Name:
Title:
26
SCHEDULE I
Underwriters Number of Shares
------------ ----------------
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. 1680
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated 1680
Citigroup Global Markets Inc. 840
Total 4,200
Schedule I-1
EXHIBIT A
[Form of opinion to be provided by Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP]
Exhibit A-1
EXHIBIT B
FORM OF [ ] ADVISER OPINION
1. The Adviser is validly existing as a corporation under the laws of the
[ ] of [ ] with full corporate power and authority to own or lease all
of the assets owned or leased by it and to conduct its business as
described in the Registration Statement and Prospectus and to enter
into and perform its obligations under the Underwriting Agreement and
the Adviser Agreements.
2. The Adviser is duly registered as an investment adviser under the
Advisers Act and is not prohibited by the Advisers Act or the
Investment Company Act from acting as investment adviser for the Fund
under the Advisory Agreement as contemplated by the Registration
Statement and the Prospectus.
3. The Underwriting Agreement and each Adviser Agreement has been duly and
validly authorized, executed and delivered by the Adviser; each Adviser
Agreement complies in all material respects with all provisions of the
Investment Company Act and the Advisers Act; and assuming due
authorization, execution and delivery by each of the other parties
thereto, each Adviser Agreement constitutes a legal, valid and binding
obligation of the Adviser, enforceable against the Adviser in
accordance with its terms, (1) subject, as to enforcement, to
applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and other similar laws affecting creditors' rights generally
and to general equitable principles (regardless of whether enforcement
is sought in a proceeding in equity or at law) and (2) except as rights
to indemnity thereunder may be limited by public policy or federal or
state securities laws (except that counsel may state that it expresses
no opinion as to the reasonableness or fairness of compensation payable
under the Advisory Agreement or the Sub-Advisory Agreement).
4. Neither (A) the execution and delivery by the Adviser of the
Underwriting Agreement or of any Adviser Agreement nor (B) the
consummation by the Adviser of the transactions contemplated by, or the
performance of its obligations under, the Underwriting Agreement or any
Adviser Agreement conflicts or will conflict with, or results or will
result in a breach of, (i) the charter or by-laws of the Adviser, (ii)
any agreement or instrument listed on an Annex to such opinion (which
the Adviser, in an officer's certificate accompanying such opinion or
otherwise delivered to the Underwriters on the Closing Date, shall have
identified as the only material agreements or instruments to which the
Adviser is a party or by which the Adviser is bound) or (iii) any
applicable United States federal or [ ] law, rule or regulation (other
than state securities or "blue sky" laws, as to which such counsel need
express no opinion), or order of any [ ] or United States federal
court, governmental instrumentality, securities exchange or association
or arbitrator, (or any other orders of any court, governmental
instrumentality, securities exchange or association or arbitrator,
whether foreign or domestic, in any other jurisdiction, as set forth on
an Annex to such opinion (which the Adviser, in an officer's
certificate accompanying such opinion or otherwise delivered to the
Underwriters on the Closing Date, shall have identified as the only
orders that are material to the Adviser) in each case specifically
naming the Adviser and (in the case of [ ] or United States federal
orders) known to such counsel, except in the case of each of clauses
(ii) and (iii) for such conflicts or breaches which do not, either
alone or in the aggregate, have a material adverse effect on the
Adviser's ability to perform its obligations under the Underwriting
Agreement or the Adviser Agreements.
5. To such counsel's knowledge, no consent, approval, authorization or
order of any New York or United States federal court, governmental
agency or body or securities exchange or association is required for
the consummation of the transactions contemplated in, or the
performance by the
Exhibit B-1
Adviser of its obligations under, the Underwriting Agreement or any
Adviser Agreement, except (i) such as have been obtained under the
United States federal securities laws and (ii) may be required by the
New York Stock Exchange or under state securities or "blue sky" laws,
in connection with the purchase and distribution of the Shares by the
Underwriters pursuant to the Underwriting Agreement.
6. To such counsel's knowledge, there is no legal or governmental
proceeding pending or threatened against the Adviser that is either (i)
required to be described in the Registration Statement or Prospectus
that is not described therein or (ii) which would, under Section 9 of
the Investment Company Act, make the Adviser ineligible to act as the
Fund's investment adviser.
Exhibit B-2
EXHIBIT C
FORM OF [ ] SUB-ADVISER OPINION
1. The Sub-Adviser is validly existing as a limited liability company
under the laws of the [ ] of [ ] with full power and authority to own
or lease all of the assets owned or leased by it and to conduct its
business as described in the Registration Statement and Prospectus and
to enter into and perform its obligations under the Underwriting
Agreement and Sub-Advisory Agreement.
2. The Sub-Adviser is duly registered as an investment adviser under the
Advisers Act and is not prohibited by the Advisers Act or the
Investment Company Act from acting as investment adviser for the Fund
under the Sub-Advisory Agreement as contemplated by the Registration
Statement and the Prospectus.
3. Each of the Underwriting Agreement and the Sub-Advisory Agreement has
been duly and validly authorized, executed and delivered by the
Sub-Adviser; the Sub-Advisory Agreement complies in all material
respects with all provisions of the Investment Company Act and the
Advisers Act; and assuming due authorization, execution and delivery by
each of the other parties thereto, the Sub-Advisory Agreement
constitutes a legal, valid and binding obligation of the Sub-Adviser,
enforceable against the Sub-Adviser in accordance with its terms, (1)
subject, as to enforcement, to applicable bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and other similar laws
affecting creditors' rights generally and to general equitable
principles (regardless of whether enforcement is sought in a proceeding
in equity or at law) and (2) except as rights to indemnity thereunder
may be limited by public policy or federal or state securities laws
(except that counsel my state that it expresses no opinion as to the
reasonableness or fairness of compensation payable under the
Sub-Advisory Agreement).
4. Neither (A) the execution and delivery by the Sub-Adviser of the
Underwriting Agreement or the Sub-Advisory Agreement nor (B) the
consummation by the Sub-Adviser of the transactions contemplated by, or
the performance of its obligations under, the Underwriting Agreement or
the Sub-Advisory Agreement conflicts or will conflict with, or results
or will result in a breach of, (i) the organizational documents of the
Sub-Adviser, (ii) any agreement or instrument listed on an Annex to
such opinion (which the Sub-Adviser, in an officer's certificate
accompanying such opinion or otherwise delivered to the Underwriters on
the Closing Date, shall have identified as the only material agreements
or instruments to which the Adviser is a party or by which the
Sub-Adviser is bound) or (iii) any applicable United States federal or
[ ] law, rule or regulation (other than state securities or "blue sky"
laws, as to which such counsel need express no opinion), or order of
any [ ] or United States federal court, governmental instrumentality,
securities exchange or association or arbitrator, (or any other orders
of any court, governmental instrumentality, securities exchange or
association or arbitrator, whether foreign or domestic, in any other
jurisdiction, as set forth on an Annex to such opinion (which the
Sub-Adviser, in an officer's certificate accompanying such opinion or
otherwise delivered to the Underwriters on the Closing Date, shall have
identified as the only orders that are material to the Sub-Adviser) in
each case specifically naming the Sub-Adviser and (in the case of [ ]
or United States federal orders) known to such counsel, except in the
case of each of clauses (ii) and (iii) for such conflicts or breaches
which do not, either alone or in the aggregate, have a material adverse
effect on the Sub-Adviser's ability to perform its obligations under
the Underwriting Agreement or the Sub-Advisory Agreement.
5. To such counsel's knowledge, no consent, approval, authorization or
order of any New York or United States federal court, governmental
agency or body or securities exchange or association is
Exhibit C-1
required for the consummation of the transactions contemplated in, or
the performance by the Sub-Adviser of its obligations under, the
Underwriting Agreement or the Sub-Advisory Agreement, except (i) such
as have been obtained under the United States federal securities laws
and (ii) may be required by the New York Stock Exchange or under state
securities or "blue sky" laws, in connection with the purchase and
distribution of the Shares by the Underwriters pursuant to the
Underwriting Agreement.
6. To such counsel's knowledge, there is no legal or governmental
proceeding pending or threatened against the Sub-Adviser that is either
(i) required to be described in the Registration Statement or
Prospectus that is not described therein or (ii) which would, under
Section 9 of the Investment Company Act, make the Sub-Adviser
ineligible to act as the Fund's investment Adviser.
Exhibit C-2
EXHIBIT D
FORM OF [ ] COMFORT LETTER
[ ], 2003
The Board of Trustees of
ING Clarion Real Estate Income Fund
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▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
as Managing Representative of the Underwriters
Ladies and Gentlemen:
We have audited the statement of assets and liabilities of ING Clarion Real
Estate Income Fund Inc. (the "Fund") as of [ ], 2003 (the "financial statement")
included in Pre-effective Amendment No. 2 to the Registration Statement on Form
N-2 filed by the Fund under the Securities Act of 1933 (the " 1933 Act") (File
No. 333-107158) and under the Investment Company Act of 1940 (the "1940 Act,"
collectively, the 1933 Act and the 1940 Act, the "Acts") (File No. 811-21404);
such statement and our report with respect to such statement are included in the
Registration Statement.
In connection with the Registration Statement:
1. We are independent auditors with respect to the Fund within the meaning
of the Acts and the applicable rules and regulations adopted thereunder
by the Securities and Exchange Commission (the "SEC").
2. In our opinion, the financial statement audited by us and included in
the Registration Statement complies as to form in all respects with the
applicable accounting requirements of the Acts and the related rules
and regulations thereunder adopted by the SEC.
3. For purposes of this letter we have read the minutes of all meetings of
the Shareholders, the Board of Trustees and all Committees of the Board
of Trustees of the Fund as set forth in the minute books at the offices
of the Fund, officials of the Fund having advised us that the minutes
of all such meetings through [ ], 2003, were set forth therein.
4. Fund officials have advised us that no financial statements as of any
date subsequent to [ ], 2003, are available. We have made inquiries of
certain officials of the Fund who have responsibility for financial and
accounting matters regarding whether there was any change at [ ], 2003,
in the capital shares or net assets of the Fund as compared with
amounts shown in the [ ], 2003, statement of assets and liabilities
included in the Registration Statement, except for changes that the
Registration Statement discloses have occurred or may occur. On the
basis of our inquiries and our reading of the minutes as described in
Paragraph 3, nothing came to our attention that caused us to believe
that there were any such changes.
5. In addition to the procedures referred to in clauses 3 and 4 about, we
have performed other specified procedures, not constituting and audit,
with respect to certain amounts, percentages,
Exhibit D-1
numerical data and financial information appearing in the Registration
Statement, which have previously been specified by the Managing
Representative and which shall be specified in this letter, and have
compared such items with, and have found such items to be in agreement
with, the accounting and financial records of the Fund.
6. With respect to the interim financial statements for the period from
[ ], 2003 (commencement of investment operations) through [ ], 2003, we
have:
a. read the unaudited statement of assets and liabilities,
including the unaudited schedule of investments, at [ ], 2003
and the related unaudited statements of operations and changes
in net assets for the period from [ ], 2002 (commencement of
investment operations) through [ ], 2003, included in the
Registration Statement, officials of the Fund having advised
us that no such financial statements as of any date or for any
period subsequent to [ ], 2003 were available; and
b. inquired of certain officials of the Fund who have
responsibility for financial and accounting matters as to: (i)
whether the unaudited financial highlights referred to in 6.a
above comply as to form in all material respects with the
applicable accounting requirements of the Acts and the
published rules and regulations thereunder, and (ii) whether
the unaudited financial statements referred to in 6.a. above
are in conformity with accounting principles generally
accepted in the United States of America applied on a basis
substantially consistent with that of the audited financial
statements included in the Registration Statement.
The foregoing procedures do not constitute an audit made in accordance with
generally accepted auditing standards. Accordingly, we make no representations
as to the sufficiency of the foregoing procedures for your purposes.
This letter is solely for the information of the addressees and to assist the
underwriters in conducting and documenting their investigation of the affairs of
the Fund in connection with the offering of the securities covered by the
Registration Statement, and is not to be used, circulated, quoted or otherwise
referred to within or without the underwriting group for any other purpose,
including but not limited to the registration, purchase or sale of securities,
nor is it to be filed with or referred to in whole or in part in the
Registration Statement or any other document, except that reference may be made
to it in the underwriting agreement or in any list of closing documents
pertaining to the offering of the securities covered by the Registration
Statement.
Exhibit D-2
