Exhibit (h)
BlackRock Core Bond Trust
[ Shares]
Common Shares
($.001 Par Value)
UNDERWRITING AGREEMENT
November 27, 2001
UNDERWRITING AGREEMENT
November 27, 2001
UBS Warburg LLC,
as Managing Underwriter
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
BlackRock Core Bond Trust, a Delaware business trust (the "Trust"),
proposes to issue and sell to the underwriters named in Schedule A annexed
hereto (the "Underwriters") an aggregate of [ ]common shares (the "Firm Shares")
of beneficial interest $0.001 par value (the "Common Shares"), of the Trust. In
addition, solely for the purpose of covering over-allotments, the Trust proposes
to grant to the Underwriters the option to purchase from the Trust up to an
additional [ ] Common Shares (the "Additional Shares"). The Firm Shares and the
Additional Shares are hereinafter collectively sometimes referred to as the
"Shares." The Shares are described in the Prospectus which is referred to below.
The Trust has filed with the Securities and Exchange Commission (the
"Commission"), in accordance with the provisions of the Securities Act of 1933,
as amended, and the rules and regulations thereunder (collectively called the
"Act"), and with the provisions of the Investment Company Act of 1940, as
amended, and the rules and regulations thereunder (collectively called the
"Investment Company Act"), a registration statement on Form N-2 (File Nos.
333-71836 and 811-10543, including a prospectus and a statement of additional
information, relating to the Shares. The Trust has furnished to you, for use by
the Underwriters and by dealers, copies of one or more preliminary prospectuses
(including a preliminary statement of additional information) (each thereof,
including such preliminary statement of additional information, being herein
called a "Preliminary Prospectus") relating to the Shares. Except where the
context otherwise requires, the registration statement, as amended when it
becomes effective (the "Effective Date"), including all documents filed as a
part thereof, and including any information contained in a prospectus
subsequently filed with the Commission pursuant to Rule 497 under the Act and
deemed to be part of the registration statement at the time of effectiveness
pursuant to Rule 430A under the Act is herein called the "Registration
Statement," and the prospectus (including the statement of additional
information), in the form filed by the Trust with the Commission pursuant to
Rule 497 under the Act or, if no such filing is required, the form of final
prospectus (including the form of final statement of additional information)
included in the Registration Statement at the time it became effective, is
herein called the "Prospectus". Any registration statement filed pursuant to
Rule 462(b) of the Act is herein referred to as the "Rule 462(b) Registration
Statement," and after such filing the term "Registration Statement" shall
include the Rule 462(b) Registration Statement. In addition, the Trust has filed
a Notification of Registration on Form N-8A (the "Notification") pursuant to
Section 8 of the Investment Company Act.
BlackRock Advisors, Inc. ("BAI") acts as the Trust's investment adviser
pursuant to an Investment Management Agreement by and between the Trust and BAI,
dated as of November 19, 2001 (the "Management Agreement"). BlackRock Financial
Management, Inc. ("BFM") acts as the Trust's investment sub-adviser pursuant to
a Sub-Investment Advisory Agreement by and between BFM and BAI, as accepted and
agreed to by the Trust, dated as of November 19, 2001 (the "Sub-Advisory
Agreement"). BAI and BFM are each an "Adviser", and together, the "Advisers".
State Street Bank and Trust Company acts as the custodian (the "Custodian") of
the Trust's cash and portfolio assets pursuant to a Custodian Agreement, dated
as of November 19, 2001 (the "Custodian Agreement"). EquiServe Trust
Company acts as the Trust's transfer agent, registrar, shareholder servicing
agent and dividend disbursing agent with respect to the common shares of the
Trust (the "Transfer Agent") pursuant to a Transfer Agent and Service Agreement,
dated as of November 26, 2001 (the "Transfer Agency Agreement").
The Trust, the Advisers and the Underwriters agree as follows:
1. SALE AND PURCHASE. Upon the basis of the warranties and
representations and subject to the terms and conditions herein set forth, the
Trust agrees to sell to the respective Underwriters and each of the
Underwriters, severally and not jointly, agrees to purchase from the Trust the
aggregate number of Firm Shares set forth opposite the name of such Underwriter
in Schedule A attached hereto in each case at a purchase price of $ [ ] per
Share. The Trust is advised by you that the Underwriters intend (i) to make a
public offering of their respective portions of the Firm Shares as soon after
the effective date of the Registration Statement as in your judgment is
advisable and (ii) initially to offer the Firm Shares upon the terms set forth
in the Prospectus. You may from time to time increase or decrease the public
offering price after the initial public offering to such extent as you may
determine.
In addition, the Trust hereby grants to the several Underwriters
the option to purchase, and upon the basis of the warranties and representations
and subject to the terms and conditions herein set forth, the Underwriters shall
have the right to purchase, severally and not jointly, from the Trust, ratably
in accordance with the number of Firm Shares to be purchased by each of them,
all or a portion of the Additional Shares as may be necessary to cover
over-allotments made in connection with the offering of the Firm Shares, at the
same purchase price per share to be paid by the Underwriters to the Trust for
the Firm Shares. This option may be exercised by you on behalf of the several
Underwriters at any time, and from time to time, on or before the forty-fifth
day following the date hereof, by written notice to the Trust. Such notice shall
set forth the aggregate number of Additional Shares as to which the option is
being exercised, and the date and time when the Additional Shares are to be
delivered (such date and time being herein referred to as the Additional Time of
Purchase); PROVIDED, HOWEVER, that the Additional Time of Purchase shall not be
earlier than the Time of Purchase (as defined below) nor earlier than the second
business day(1) after the date on which the option shall have been exercised nor
later than the tenth business day after the date on which the option shall have
been exercised. The number of Additional Shares to be sold to each Underwriter
shall be the number which bears the same proportion to the aggregate number of
Additional Shares being purchased as the number of Firm Shares set forth
opposite the name of such Underwriter on Schedule A hereto bears to the total
number of Firm Shares (subject, in each case, to such adjustment as you may
determine to eliminate fractional shares).
2. PAYMENT AND DELIVERY. Payment of the purchase price for the Firm
Shares shall be made to the Trust by Federal Funds wire transfer, against
delivery of the certificates for the Firm Shares to you through the facilities
of the Depository Trust Company ("DTC") for the respective accounts of the
Underwriters. Such payment and delivery shall be made at 10:00 A.M., New York
City time, on November 30, 2001 (unless another time shall be agreed to by you
and the Trust or unless postponed in accordance with the provisions of Section 8
hereof). The time at which such payment and delivery are actually made is
hereinafter sometimes called the "Time of Purchase" or the "Closing Date".
Certificates for the Firm Shares shall be delivered to you in definitive form in
such names and in such denominations as you shall specify on the second business
day preceding the Time of Purchase. For the purpose of expediting the checking
of the certificates for the Firm Shares by you, the Trust agrees to make such
certificates available to you for such purpose at least one full business day
preceding the Time of Purchase.
Payment of the purchase price for the Additional Shares shall be
made at the Additional Time of Purchase in the same manner and at the same
office as the payment for the Firm Shares.
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(1) As used herein "business day" shall mean a day on which the New York
Stock Exchange is open for trading.
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Certificates for the Additional Shares shall be delivered to you in definitive
form in such names and in such denominations as you shall specify no later than
the second business day preceding the Additional Time of Purchase. For the
purpose of expediting the checking of the certificates for the Additional Shares
by you, the Trust agrees to make such certificates available to you for such
purpose at least one full business day preceding the Additional Time of
Purchase.
3. REPRESENTATIONS AND WARRANTIES OF THE TRUST AND THE ADVISERS.
(a) The Trust and the Advisers jointly and severally
represent and warrant to each of the Underwriters as of the date hereof
and as of the Closing Date and each Additional Time of Purchase, if any,
referred to in Section 2 hereof, and agree with each Underwriter, as
follows:
(i) Each of the Registration Statement and any Rule
462(b) Registration Statement has become effective under the Act
and no stop order suspending the effectiveness of the
Registration Statement or any Rule 462(b) Registration Statement
has been issued under the Act, or order of suspension or
revocation of registration pursuant to Section 8(e) of the
Investment Company Act, and no proceedings for any such purpose
have been instituted or are pending or, to the knowledge of the
Trust or the Advisers, are contemplated by the Commission, and
any request on the part of the Commission for additional
information has been complied with.
At the respective times the Registration Statement, any
Rule 462(b) Registration Statement and any post-effective
amendments thereto became effective and at any Closing Date, the
Registration Statement, the Rule 462(b) Registration Statement,
the Notification and any amendments and supplements thereto
complied and will comply in all material respects with the
requirements of the Act and the Investment Company Act and did
not and will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
Neither the Prospectus nor any amendments or supplements
thereto, at the time the Prospectus or any such amendment or
supplement was issued and at any Closing Date, included or will
include an untrue statement of a material fact or omitted or
will omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading. If Rule 434 of the Act is
used, the Trust will comply with the requirements of Rule 434
and the Prospectus shall not be "materially different", as such
term is used in Rule 434, from the prospectus included in the
Registration Statement at the time it became effective.
Each preliminary prospectus and the prospectus filed as
part of the Registration Statement as originally filed or as
part of any amendment thereto, or filed pursuant to Rule 497
under the Act, complied when so filed in all material respects
with the Rules and Regulations and each preliminary prospectus
and the Prospectus delivered to the Underwriters for use in
connection with this offering was identical to the
electronically transmitted copies thereof filed with the
Commission pursuant to its Electronic Data Gathering Analysis
and Retrieval System ("XXXXX"), except to the extent permitted
by Regulation S-T.
If a Rule 462(b) Registration Statement is required in
connection with the offering and sale of the Shares, the Trust
has complied or will comply with the requirements of Rule 111
under the Act relating to the payment of filing fees thereof.
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(ii) The accountants who certified the statement of
assets and liabilities included in the Registration Statement
are independent public accountants as required by the Act.
(iii) The statement of assets and liabilities included
in the Registration Statement and the Prospectus, together with
the related notes, presents fairly the financial position of the
Trust at the date indicated; said statement has been prepared in
conformity with generally accepted accounting principles
("GAAP").
(iv) To the extent estimated or projected, such
estimates or projections set forth in the Prospectus in the Fee
Table are reasonably believed to be attainable and reasonably
based.
(v) Since the respective dates as of which
information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, (A) there has
been no material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business
prospects of the Trust, whether or not arising in the ordinary
course of business (a "Material Adverse Effect"), (B) there have
been no transactions entered into by the Trust, other than those
in the ordinary course of business, which are material with
respect to the Trust, and (C) there has been no dividend or
distribution of any kind declared, paid or made by the Trust on
any class of its capital stock other than dividends made in the
ordinary course of business prior to the Additional Time of
Purchase.
(vi) The Trust has been duly organized and is validly
existing as a business trust in good standing under the laws of
the State of Delaware and has business trust power and authority
to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and
perform its obligations under this Agreement; and the Trust is
duly qualified as a foreign business trust to transact business
and is in good standing in each other jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result
in a Material Adverse Effect.
(vii) The Trust has no subsidiaries.
(viii) The Trust is duly registered with the Commission
under the Investment Company Act as a closed-end diversified
management investment company, and no order of suspension or
revocation of such registration has been issued or proceedings
therefor initiated or threatened by the Commission.
(ix) No person is serving or acting as an officer,
trustee or investment adviser of the Trust except in accordance
with the provisions of the Investment Company Act and the
Investment Advisers Act of 1940, as amended, and the rules and
regulations thereunder, (the "Advisers Act"). Except as
disclosed in the Registration Statement and the Prospectus (or
any amendment or supplement to either of them), no trustee of
the Trust is an "interested person" (as defined in the
Investment Company Act) of the Trust or an "affiliated person"
(as defined in the Investment Company Act) of any Underwriter.
(x) The authorized, issued and outstanding common
shares of beneficial interest of the Trust is as set forth in
the Prospectus as of the date thereof under the
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caption "Description of Shares." All issued and outstanding
common shares of beneficial interest of the Trust have been duly
authorized and validly issued and are fully paid and
non-assessable, except as provided for in the Trust's
declaration of trust, and have been offered and sold or
exchanged by the Trust in compliance with all applicable laws
(including, without limitation, federal and state securities
laws); none of the outstanding common shares of beneficial
interest of the Trust was issued in violation of the preemptive
or other similar rights of any securityholder of the Trust.
(xi) The Shares to be purchased by the Underwriters
from the Trust have been duly authorized for issuance and sale
to the Underwriters pursuant to this Agreement and, when issued
and delivered by the Trust pursuant to this Agreement against
payment of the consideration set forth herein, will be validly
issued and fully paid and non-assessable, except as provided for
in the Trust's declaration of trust. The Shares conform in all
material respects to all statements relating thereto contained
in the Prospectus and such description conforms in all material
respects to the rights set forth in the instruments defining the
same; no holder of the Shares will be subject to personal
liability by reason of being such a holder; and the issuance of
the Shares is not subject to the preemptive or other similar
rights of any securityholder of the Trust.
(xii) The Trust is not in violation of its declaration
of trust or by-laws, or in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or
instrument to which it is a party or by which it may be bound,
or to which any of the property or assets of the Trust is
subject (collectively, "Agreements and Instruments") except for
such violations or defaults that would not result in a Material
Adverse Effect; and the execution, delivery and performance of
this Agreement, the Management Agreement, the Sub-Advisory
Agreement, the Custodian Agreement and the Transfer Agency
Agreement and the consummation of the transactions contemplated
herein and in the Registration Statement (including the issuance
and sale of the Shares and the use of the proceeds from the sale
of the Shares as described in the Prospectus under the caption
"Use of Proceeds") and compliance by the Trust with its
obligations hereunder have been duly authorized by all necessary
corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment
Event (as defined below) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property
or assets of the Trust pursuant to, the Agreements and
Instruments (except for such conflicts, breaches or defaults or
liens, charges or encumbrances that would not result in a
Material Adverse Effect), nor will such action result in any
violation of the provisions of the declaration of trust or
by-laws of the Trust or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Trust or any of its assets, properties or
operations. As used herein, a "Repayment Event" means any event
or condition which gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the
Trust.
(xiii) There is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the
knowledge of the Trust or the Advisers, threatened, against or
affecting the Trust, which is required to be disclosed in the
Registration Statement (other than as
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disclosed therein), or which might reasonably be expected to
result in a Material Adverse Effect, or which might reasonably
be expected to materially and adversely affect the properties or
assets of the Trust or the consummation of the transactions
contemplated in this Agreement or the performance by the Trust
of its obligations hereunder. The aggregate of all pending legal
or governmental proceedings to which the Trust is a party or of
which any of its property or assets is the subject which are not
described in the Registration Statement, including ordinary
routine litigation incidental to the business, could not
reasonably be expected to result in a Material Adverse Effect.
(xiv) There are no contracts or documents which are
required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits thereto by the Act or the
Investment Company Act which have not been so described and
filed as required.
(xv) The Trust owns or possesses, or can acquire on
reasonable terms, adequate patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks,
trade names or other intellectual property (collectively,
"Intellectual Property") necessary to carry on the business now
operated by the Trust, and the Trust has not received any notice
or is not otherwise aware of any infringement of or conflict
with asserted rights of others with respect to any Intellectual
Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the
interest of the Trust therein, and which infringement or
conflict (if the subject of any unfavorable decision, ruling or
finding) or invalidity or inadequacy, singly or in the
aggregate, would result in a Material Adverse Effect; provided
that the Trust's right to use the name "BlackRock" is limited as
set forth in Section 16 of the Management Agreement.
(xvi) No filing with, or authorization, approval,
consent, license, order, registration, qualification or decree
of, any court or governmental authority or agency is necessary
or required for the performance by the Trust of its obligations
hereunder, in connection with the offering, issuance or sale of
the Shares hereunder or the consummation of the transactions
contemplated by this Agreement, except such as have been already
obtained or as may be required under the Act, the Investment
Company Act, the Securities Exchange Act of 1934, as amended
(the "1934 Act"), or state securities laws.
(xvii) The Trust possesses such permits, licenses,
approvals, consents and other authorizations (collectively,
"Governmental Licenses") issued by the appropriate federal,
state, local or foreign regulatory agencies or bodies necessary
to operate its properties and to conduct the business as
contemplated in the Prospectus; the Trust is in compliance with
the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not, singly or in
the aggregate, have a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect,
except when the invalidity of such Governmental Licenses or the
failure of such Governmental Licenses to be in full force and
effect would not have a Material Adverse Effect; and the Trust
has not received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses
which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
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(xviii) Any advertising, sales literature or other
promotional material (including "prospectus wrappers", "broker
kits," "road show slides" and "road show scripts") authorized in
writing by or prepared by the Trust or the Advisers used in
connection with the public offering of the Shares (collectively,
"sales material") does not contain an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading. Moreover, all sales material complied and will
comply in all material respects with the applicable requirements
of the Act, the Investment Company Act and the rules and
interpretations of the National Association of Securities
Dealers, Inc. ("NASD").
(xix) The Trust intends to direct the investment of
the proceeds of the offering described in the Registration
Statement in such a manner as to comply with the requirements of
Subchapter M of the Internal Revenue Code of 1986, as amended
("Subchapter M of the Code" and the "Code," respectively), and
intends to qualify as a regulated investment company under
Subchapter M of the Code.
(xx) This Agreement, the Management Agreement, the
Sub-Advisory Agreement, the Custodian Agreement and the Transfer
Agency Agreement have each been duly authorized by all requisite
action on the part of the Trust, executed and delivered by the
Trust, as of the dates noted therein, and each complies with all
applicable provisions of the Investment Company Act. Assuming
due authorization, execution and delivery by the other parties
thereto with respect to the Custodian Agreement and the Transfer
Agency Agreement, each of the Management Agreement, the
Sub-Advisory Agreement, the Custodian Agreement and the Transfer
Agency Agreement constitutes a valid and binding agreement of
the Trust, enforceable in accordance with its terms, except as
affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at
law).
(xxi) There are no persons with registration rights or
other similar rights to have any securities registered pursuant
to the Registration Statement or otherwise registered by the
Trust under the Act.
(xxii) The Shares have been duly authorized for
listing, upon notice of issuance, on the New York Stock Exchange
("NYSE") and the Trust's registration statement on Form 8-A
under the 1934 Act has become effective.
(b) The Advisers represent and warrant to each Underwriter
as of the date hereof and as of the Closing Date referred to in Section
2 hereof as follows:
(i) Each of the Advisers has been duly organized and
is validly existing and in good standing as corporations under
the laws of the State of Delaware with full corporate power and
authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and each is
duly qualified as a foreign corporation to transact business and
is in good standing in each other jurisdiction in which such
qualification is required.
(ii) Each of Advisers is duly registered and in good
standing with the Commission as an investment adviser under the
Advisers Act, and is not prohibited by
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the Advisers Act or the Investment Company Act, or the rules and
regulations under such acts, from acting under the Management
Agreement and the Sub-Advisory Agreement for the Trust as
contemplated by the Prospectus.
(iii) The description of each Adviser in the
Registration Statement and the Prospectus (and any amendment or
supplement to either of them) complied and comply in all
material respects with the provisions of the Act, the Investment
Company Act and the Advisers Act and is true and correct and
does not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.
(iv) Each of the Advisers has the financial resources
available to it necessary for the performance of its services
and obligations as contemplated in the Prospectus, this
Agreement and under the respective Management Agreement and the
Sub-Advisory Agreement to which it is a party.
(v) This Agreement, the Management Agreement, the
Sub-Advisory Agreement and the Shareholder Servicing Agreement,
by and between UBS Warburg LLC and BAI (the "Shareholder
Servicing Agreement"), have each been duly authorized, executed
and delivered by each respective Adviser, and the Management
Agreement, the Sub-Advisory Agreement and the Shareholder
Servicing Agreement each constitute a valid and binding
obligation of each respective Adviser, enforceable in accordance
with its terms, except as affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights
generally and general equitable principles (whether considered
in a proceeding in equity or at law); and neither the execution
and delivery of this Agreement, the Management Agreement, the
Sub-Advisory Agreement or the Shareholder Servicing Agreement
nor the performance by either of the Advisers of its obligations
hereunder or thereunder will conflict with, or result in a
breach of any of the terms and provisions of, or constitute,
with or without the giving of notice or lapse of time or both, a
default under, any agreement or instrument to which either
Adviser is a party or by which it is bound, the certificate of
incorporation, the by-laws or other organizational documents of
each of the Advisers, or to each Adviser's knowledge, by any
law, order, decree, rule or regulation applicable to it of any
jurisdiction, court, federal or state regulatory body,
administrative agency or other governmental body, stock exchange
or securities association having jurisdiction over the Advisers
or their respective properties or operations; and no consent,
approval, authorization or order of any court or governmental
authority or agency is required for the consummation by the
Advisers of the transactions contemplated by this Agreement, the
Management Agreement, the Sub-Advisory Agreement or the
Shareholder Servicing Agreement, except as have been obtained or
may be required under the Act, the Investment Company Act, the
1934 Act or state securities laws. The representations and
warranties made by the Advisers in this paragraph in regards to
the Shareholder Servicing Agreement are made only as of the
Closing Date.
(vi) Since the respective dates as of which
information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, there has not
occurred any event which should reasonably be expected to have a
material adverse effect on the ability of either Adviser to
perform its respective obligations under this Agreement and the
respective Management Agreement and Sub-Advisory Agreement to
which it is a party.
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(vii) There is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the
knowledge of the Advisers, threatened against or affecting
either of the Advisers or any "affiliated person" of either of
the Advisers (as such term is defined in the Investment Company
Act) or any partners, directors, officers or employees of the
foregoing, whether or not arising in the ordinary course of
business, which might reasonably be expected to result in any
material adverse change in the condition, financial or
otherwise, or earnings, business affairs or business prospects
of either of the Advisers, materially and adversely affect the
properties or assets of either of the Advisers or materially
impair or adversely affect the ability of either of the Advisers
to function as an investment adviser or perform its obligations
under the Management Agreement or the Sub-Advisory Agreement, or
which is required to be disclosed in the Registration Statement
and the Prospectus.
(viii) Each Adviser is not in violation of its
certificate of incorporation, by-laws or other organizational
documents or in default under any agreement, indenture or
instrument except for such violations or defaults that would not
result in a Material Adverse Effect on the respective Adviser or
the Trust.
(c) Any certificate signed by any officer of the Trust or
the Advisers delivered to the Representative or to counsel for the
Underwriters shall be deemed a representation and warranty by the Trust
or the Advisers, as the case may be, to each Underwriter as to the
matters covered thereby.
4. CERTAIN COVENANTS OF THE TRUST AND THE ADVISERS
(a) The Trust and the Advisers, jointly and severally,
covenant with each Underwriter as follows:
(i) The Trust, subject to Section 4(a)(ii), will
comply with the requirements of Rule 430A or Rule 434, as
applicable, and will notify UBS Warburg LLC (the
"Representative") immediately, and confirm the notice in writing
or by sending any relevant copies of the following documents to
the Representative, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement
to the Prospectus or any amended Prospectus shall have been
filed, (ii) of the receipt of any comments from the Commission,
(iii) of any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the
Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order
preventing or suspending the use of any preliminary prospectus,
or of the suspension of the qualification of the Shares for
offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes. The
Trust will promptly effect the filings necessary pursuant to
Rule 497 of the Act and will take such steps as it deems
necessary to ascertain promptly whether the form of prospectus
transmitted for filing under Rule 497 was received for filing by
the Commission and, in the event that it was not, it will
promptly file such prospectus. The Trust will make every
reasonable effort to prevent the issuance of any stop order, or
order of suspension or revocation of registration pursuant to
Section 8(e) of the Investment Company Act, and, if any such
stop order or order of suspension or revocation of registration
is issued, to obtain the lifting thereof at the earliest
possible moment.
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(ii) The Trust will give the Representative notice of
its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b))
or any amendment, supplement or revision to either the
prospectus included in the Registration Statement at the time it
became effective or to the Prospectus, will furnish the
Representative with copies of any such documents a reasonable
amount of time prior to such proposed filing or use, as the case
may be, and will not file or use any such document to which the
Representative or counsel for the Underwriters shall object.
(iii) The Trust has furnished or will deliver to the
Representative and counsel for the Underwriters, without charge,
signed copies of the Registration Statement as originally filed
and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein) and signed
copies of all consents and certificates of experts, and will
also deliver to the Representative, without charge, a conformed
copy of the Registration Statement as originally filed and of
each amendment thereto (without exhibits) for each of the
Underwriters. The copies of the Registration Statement and each
amendment thereto furnished to the Underwriters will be
identical to the electronically transmitted copies thereof filed
with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(iv) The Trust has delivered to each Underwriter,
without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Trust hereby
consents to the use of such copies for purposes permitted by the
Act. The Trust will furnish to each Underwriter, without charge,
during the period when the Prospectus is required to be
delivered under the Act or the 1934 Act, such number of copies
of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriters
will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to
the extent permitted by Regulation S-T.
(v) If at any time when a prospectus is required by
the Act to be delivered in connection with sales of the Shares,
any event shall occur or condition shall exist as a result of
which it is necessary, in the opinion of counsel for the
Underwriters or for the Trust, to amend the Registration
Statement or amend or supplement the Prospectus in order that
the Prospectus will not include any untrue statements of a
material fact or omit to state a material fact necessary in
order to make the statements therein not misleading in the light
of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the
requirements of the Act, the Trust will promptly prepare and
file with the Commission, subject to Section 3(a)(ii), such
amendment or supplement as may be necessary to correct such
statement or omission or to make the Registration Statement or
the Prospectus comply with such requirements, and the Trust will
furnish to the Underwriters such number of copies of such
amendment or supplement as the Underwriters may reasonably
request.
(vi) The Trust will use its best efforts, in
cooperation with the Underwriters, to qualify the Shares for
offering and sale under the applicable securities laws of such
states and other jurisdictions of the United States as the
Representative may designate and to maintain such qualifications
in effect for a period of not less than one year from the later
of the effective date of the Registration Statement and any Rule
462(b)
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Registration Statement; provided, however, that the Trust shall
not be obligated to file any general consent to service of
process or to qualify as a foreign business trust or as a dealer
in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so
subject. In each jurisdiction in which the Shares have been so
qualified, the Trust will file such statements and reports as
may be required by the laws of such jurisdiction to continue
such qualification in effect for a period of not less than one
year from the effective date of the Registration Statement and
any Rule 462(b) Registration Statement.
(vii) The Trust will timely file such reports pursuant
to the 1934 Act as are necessary in order to make generally
available to its security holders as soon as practicable an
earnings statement for the purposes of, and to provide the
benefits contemplated by, the last paragraph of Section 11(a) of
the Act.
(viii) The Trust will use the net proceeds received by
it from the sale of the Shares in the manner specified in the
Prospectus under "Use of Proceeds".
(ix) The Trust will use its reasonable best efforts
to effect the listing of the Shares on the NYSE, subject to
notice of issuance, concurrently with the effectiveness of the
Registration Statement.
(x) During a period of 180 days from the date of the
Prospectus, the Trust will not, without the prior written
consent of the Representative, (A) directly or indirectly,
offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell,
grant any option, right or warrant to purchase or otherwise
transfer or dispose of Shares or any securities convertible into
or exercisable or exchangeable for Shares or file any
registration statement under the Act with respect to any of the
foregoing or (B) enter into any swap or any other agreement or
any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Shares,
whether any such swap or transaction described in clause (A) or
(B) above is to be settled by delivery of Shares or such other
securities, in cash or otherwise. The foregoing sentence shall
not apply to (1) the Shares to be sold hereunder or (2) Shares
issued pursuant to any dividend reinvestment plan.
(xi) The Trust, during the period when the Prospectus
is required to be delivered under the Act or the 1934 Act, will
file all documents required to be filed with the Commission
pursuant to the Investment Company Act and the 1934 Act within
the time periods required by the Investment Company Act,
respectively.
(xii) The Trust will comply with the requirements of
Subchapter M of the Code to qualify as a regulated investment
company under the Code.
(xiii) The Trust will not (a) take, directly or
indirectly, any action designed to cause or to result in, or
that might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of
the Trust to facilitate the sale or resale of the Shares, and
(b) until the Closing Date (i) sell, bid for or purchase the
Shares or pay any person any compensation for soliciting
purchases of the Shares or (ii) pay or agree to pay to any
person any compensation for soliciting another to purchase any
other securities of the Trust.
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(xiv) If the Trust elects to rely upon Rule 462(b),
the Trust shall file a Rule 462(b) Registration Statement with
the Commission in compliance with Rule 462(b) by no later than
10:00 P.M., Washington, D.C. time, on the day following the date
of this Agreement, and the Trust shall at the time of filing
either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the
payment of such fee pursuant to Rule 111(b) under the Act.
(xv) The Trust will pay all costs, expenses, fees and
taxes (other than any transfer taxes and fees and disbursements
of counsel for the Underwriters except as set forth under
Section 5 hereof and (iii), (iv) and (vi) below) in connection
with (i) the preparation and filing of the Registration
Statement, each preliminary prospectus, the Prospectus, and any
amendments or supplements thereto, and the printing and
furnishing of copies of each thereof to the Underwriters and to
dealers (including costs of mailing and shipment), (ii) the
registration, issue, sale and delivery of the Shares, (iii) the
producing, word processing and/or printing of this Agreement,
any Agreement Among Underwriters, any dealer agreements, any
Powers of Attorney and any closing documents (including
compilations thereof) and the reproduction and/or printing and
furnishing of copies of each thereof to the Underwriters and
(except closing documents) to dealers (including costs of
mailing and shipment), (iv) the qualification of the Shares for
offering and sale under state laws and the determination of
their eligibility for investment under state law as aforesaid
(including the legal fees and filing fees and other
disbursements of counsel for the Underwriters) and the printing
and furnishing of copies of any blue sky surveys or legal
investment surveys to the Underwriters and to dealers, (v) any
listing of the Shares on any securities exchange or
qualification of the Shares for quotation on NASDAQ and any
registration thereof under the Exchange Act, (vi) any filing for
review of the public offering of the Shares by the NASD and
(vii) the performance of the Trust's other obligations
hereunder. BAI has agreed to pay organizational expenses and
offering costs (other than sales load) of the Trust that exceed
$.03 per Common Share.
5. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Shares are not
delivered for any reason other than the termination of this Agreement pursuant
to the first two paragraphs of Section 7 hereof or the default by one or more of
the Underwriters in its or their respective obligations hereunder, the Trust
shall, in addition to paying the amounts described in Section 4(a)(xv) hereof,
reimburse the Underwriters for all of their out-of-pocket expenses, including
the fees and disbursements of their counsel.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
several Underwriters hereunder are subject to the accuracy in all material
respects of the representations and warranties of the Trust and the Advisers
contained in Section 3 hereof or in certificates of any officer of the Trust or
the Advisers delivered pursuant to the provisions hereof, to the performance by
the Trust and the Advisers of their respective covenants and other obligations
hereunder, and to the following further conditions:
(a) The Registration Statement, including any Rule 462(b)
Registration Statement, has become effective and at the Closing Date no
stop order suspending the effectiveness of the Registration Statement
shall have been issued under the Act, no notice or order pursuant to
Section 8(e) of the Investment Company Act shall have been issued, and
no proceedings with respect to either shall have been initiated or
threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. A prospectus
containing the Rule 430A information shall have been filed with the
Commission in accordance with Rule 497 (or a post-effective amendment
providing such information shall have been filed and declared effective
in accordance with the requirements of Rule 430A).
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(b) No amendment or supplement to the Registration Statement
or Prospectus shall be filed prior to the time the Registration
Statement becomes effective to which you object in writing.
(c) The Registration Statement shall become effective at or
before 5:00 P.M., New York City time, on the date of this Agreement,
unless a later time (but not later than 5:00 P.M., New York City time,
on the second full business day after the date of this Agreement) shall
be agreed to by the Trust and you in writing or by telephone, confirmed
in writing; PROVIDED, HOWEVER, that the Trust and you and any group of
Underwriters, including you, who have agreed hereunder to purchase in
the aggregate at least 50% of the Firm Shares may from time to time
agree on a later date.
(d) Prior to the Time of Purchase, or the Additional Time of
Purchase, as the case may be, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under
the Act or proceedings initiated under Section 8(d) or 8(e) of the Act;
(ii) the Registration Statement and all amendments thereto, or
modifications thereof, if any, shall not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; and
(iii) the Prospectus and all amendments or supplements thereto, or
modifications thereof, if any, shall 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 light of the
circumstances under which they are made, not misleading.
(e) At the Closing Date, the Representative shall have
received the favorable opinions, dated as of the Closing Date, of
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the Trust, and
Xxxxxx X. Xxxxxxxx, counsel for the Advisers, in form and substance
satisfactory to counsel for the Underwriters, together with signed or
reproduced copies of such letters for each of the other Underwriters
substantially to the effect set forth in EXHIBIT A hereto and to such
further effect as counsel to the Underwriters may reasonably request.
(f) At the Closing Date, the Representative shall have
received the favorable opinion, dated as of the Closing Date, of
Xxxxxxxx Chance Xxxxxx & Xxxxx LLP, counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of the
other Underwriters with respect to the matters set forth in clauses (A)
(i), (ii), (vi), (vii) (solely as to preemptive or other similar rights
arising by operation of law or under the charter or by-laws of the
Trust), (viii) through (x), inclusive, (xii), (xiv) (solely as to the
information in the Prospectus under "Description of Shares") and the
last paragraph of EXHIBIT A hereto. In giving such opinion such counsel
may rely, as to all matters governed by the laws of jurisdictions other
than the law of the State of New York and the federal law of the United
States, upon the opinions of counsel satisfactory to the Representative.
Such counsel may also state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Trust and certificates of public
officials.
(g) At the Closing Date, there shall not have been, since
the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition,
financial or otherwise, or in the earnings or business affairs of the
Trust, whether or not arising in the ordinary course of business, and
the Representative shall have received a certificate of a duly
authorized officer of the Trust and of the Treasurer of the Trust and of
the President or a Vice President or Managing Director of each of the
Advisers, dated as of the Closing Date, to the effect that (i) there has
been no such material adverse change, (ii) the representations and
warranties in Sections 3(a) and (b) hereof are true and correct in all
material
- 13 -
respects with the same force and effect as though expressly made at and
as of the Closing Date, (iii) each of the Trust and the Advisers,
respectively, has complied in all material respects with all agreements
and satisfied in all material respects all conditions on its part to be
performed or satisfied at or prior to the Closing Date, and (iv) no stop
order suspending the effectiveness of the Registration Statement, or
order of suspension or revocation of registration pursuant to Section
8(e) of the Investment Company Act, has been issued and no proceedings
for any such purpose have been instituted or are pending or are
contemplated by the Commission.
(h) At the time of the execution of this Agreement, the
Representative shall have received from Deloitte & Touche LLP a letter
dated such date, in form and substance satisfactory to the
Representative, together with signed or reproduced copies of such letter
for each of the other Underwriters containing statements and information
of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain
financial information contained in the Registration Statement and the
Prospectus.
(i) At the Closing Date, the Representative shall have
received from Deloitte & Touche LLP a letter, dated as of the Closing
Date, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (e) of this Section, except that the
specified date referred to shall be a date not more than three business
days prior to The Closing Date.
(j) At the Closing Date, the Shares shall have been approved
for listing on the NYSE, subject only to official notice of issuance.
(k) The NASD has confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the
underwriting terms and arrangements.
(l) In the event that the Underwriters exercise their option
provided in Section 1 hereof to purchase all or any portion of the
Additional Shares, the representations and warranties of the Trust
contained herein and the statements in any certificates furnished by the
Trust hereunder shall be true and correct as of each Additional Time of
Purchase and, at the relevant Additional Time of Purchase, the
Representative shall have received:
(i) Certificates, dated such Additional Time of
Purchase, of a duly authorized officer of the Trust and of the
Treasurer of the Trust and of the President or a Vice President
or Managing Director of each of the Advisers confirming that the
information contained in the certificate delivered by each of
them at the Closing Date pursuant to Section 6(d) hereof remains
true and correct in all material respects as of such Additional
Time of Purchase.
(ii) The favorable opinion of Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, counsel for the Trust, and Xxxxxx X.
Xxxxxxxx, counsel for the Advisers, in form and substance
satisfactory to counsel for the Underwriters, dated such
Additional Time of Purchase, relating to the Additional Shares
to be purchased on such Additional Time of Purchase and
otherwise to the same effect as the opinion required by Section
6(b) hereof.
(iii) The favorable opinion of Xxxxxxxx Chance Xxxxxx
& Xxxxx LLP, counsel for the Underwriters, dated such Additional
Time of Purchase, relating to the Additional Shares to be
purchased on such Additional Time of Purchase and otherwise to
the same effect as the opinion required by Section 6(c) hereof.
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(iv) A letter from Deloitte & Touche LLP, in form and
substance satisfactory to the Representative and dated such
Additional Time of Purchase, substantially in the same form and
substance as the letter furnished to the Representative pursuant
to Section 6(f) hereof, except that the "specified date" in the
letter furnished pursuant to this paragraph shall be a date not
more than five days prior to such Additional Time of Purchase.
(m) At the Closing Date and at each Additional Time of
Purchase, counsel for the Underwriters shall have been furnished with
such documents and opinions as they may reasonably require for the
purpose of enabling them to pass upon the issuance and sale of the
Shares as herein contemplated, or in order to evidence the accuracy of
any of the representations or warranties, or the fulfillment of any of
the conditions, herein contained; and all proceedings taken by the Trust
and the Advisers in connection with the organization and registration of
the Trust under the Investment Company Act and the issuance and sale of
the Shares as herein contemplated shall be satisfactory in form and
substance to the Representative and counsel for the Underwriters.
7. EFFECTIVE DATE OF AGREEMENT; TERMINATION. This Agreement shall
become effective (i) if Rule 430A under the Act is not used, when you shall have
received notification of the effectiveness of the Registration Statement, or
(ii) if Rule 430A under the Act is used, when the parties hereto have executed
and delivered this Agreement.
The obligations of the several Underwriters hereunder shall be
subject to termination in the absolute discretion of you or any group of
Underwriters (which may include you) which has agreed to purchase in the
aggregate at least 50% of the Firm Shares, if, since the time of execution of
this Agreement or the respective dates as of which information is given in the
Registration Statement and Prospectus, (y) there has been any material adverse
change, financial or otherwise (other than as referred to in the Registration
Statement and Prospectus), in the operations, business or condition of the Trust
and its subsidiaries taken as a whole, which would, in your judgment or in the
judgment of such group of Underwriters, make it impracticable to market the
Shares, or (z) if, at any time prior to the Time of Purchase or, with respect to
the purchase of any Additional Shares, the Additional Time of Purchase, as the
case may be, trading in securities on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National Market shall have been suspended or
limitations or minimum prices shall have been established on the New York Stock
Exchange, the American Stock Exchange or the Nasdaq National Market, or if a
banking moratorium shall have been declared either by the United States or New
York State authorities, or if the United States shall have declared war in
accordance with its constitutional processes or there shall have occurred any
material outbreak or escalation of hostilities or other national or
international calamity or crisis of such magnitude in its effect on the
financial markets of the United States as, in your judgment or in the judgment
of such group of Underwriters, to make it impracticable to market the Shares.
If you or any group of Underwriters elects to terminate this
Agreement as provided in this Section 7, the Trust and each other Underwriter
shall be notified promptly by letter or telegram.
If the sale to the Underwriters of the Shares, as contemplated
by this Agreement, is not carried out by the Underwriters for any reason
permitted under this Agreement or if such sale is not carried out because the
Trust shall be unable to comply with any of the terms of this Agreement, the
Trust shall not be under any obligation or liability under this Agreement
(except to the extent provided in Sections 4(a)(xv), 5 and 9 hereof), and the
Underwriters shall be under no obligation or liability to the Trust under this
Agreement (except to the extent provided in Section 9 hereof) or to one another
hereunder.
- 15 -
8. INCREASE IN UNDERWRITERS' COMMITMENTS. Subject to Sections 6 and
7, if any Underwriter shall default in its obligation to take up and pay for the
Firm Shares to be purchased by it hereunder (otherwise than for a reason
sufficient to justify the termination of this Agreement under the provisions of
Section 7 hereof) and if the number of Firm Shares which all Underwriters so
defaulting shall have agreed but failed to take up and pay for does not exceed
10% of the total number of Firm Shares, the non-defaulting Underwriters shall
take up and pay for (in addition to the aggregate number of Firm Shares they are
obligated to purchase pursuant to Section 1 hereof) the number of Firm Shares
agreed to be purchased by all such defaulting Underwriters, as hereinafter
provided. Such Shares shall be taken up and paid for by such non-defaulting
Underwriter or Underwriters in such amount or amounts as you may designate with
the consent of each Underwriter so designated or, in the event no such
designation is made, such Shares shall be taken up and paid for by all
non-defaulting Underwriters pro rata in proportion to the aggregate number of
Firm Shares set opposite the names of such non-defaulting Underwriters in
Schedule A.
Without relieving any defaulting Underwriter from its
obligations hereunder, the Trust agrees with the non-defaulting Underwriters
that it will not sell any Firm Shares hereunder unless all of the Firm Shares
are purchased by the Underwriters (or by substituted Underwriters selected by
you with the approval of the Trust or selected by the Trust with your approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Trust for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Trust or you shall have the right
to postpone the Time of Purchase for a period not exceeding five business days
in order that any necessary changes in the Registration Statement and Prospectus
and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to
and include any Underwriter substituted under this Section 8 with like effect as
if such substituted Underwriter had originally been named in Schedule A.
If the aggregate number of Shares which the defaulting
Underwriter or Underwriters agreed to purchase exceeds 10% of the total number
of Shares which all Underwriters agreed to purchase hereunder, and if neither
the non-defaulting Underwriters nor the Trust shall make arrangements within the
five business day period stated above for the purchase of all the Shares which
the defaulting Underwriter or Underwriters agreed to purchase hereunder, this
Agreement shall be terminated without further act or deed and without any
liability on the part of the Trust to any non-defaulting Underwriter and without
any liability on the part of any non-defaulting Underwriter to the Trust.
Nothing in this paragraph, and no action taken hereunder, shall relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
9. INDEMNITY AND CONTRIBUTION.
(a) Each of the Trust and the Advisers, jointly and
severally, agrees to indemnify, defend and hold harmless each
Underwriter, its trustees, partners, directors and officers, and any
person who controls any Underwriter within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, and the successors and
assigns of all of the foregoing persons from and against any loss,
damage, expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, any such Underwriter or any
such person may incur under the Act, the Exchange Act, the common law or
otherwise, insofar as such loss, damage, expense, liability or claim
arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement (or
in the Registration Statement as amended by any post-effective amendment
thereof by the Trust) or in a Prospectus
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(the term Prospectus for the purpose of this Section 9 being deemed to
include any preliminary prospectus, the Prospectus and the Prospectus as
amended or supplemented by the Trust), or arises out of or is based upon
any omission or alleged omission to state a material fact required to be
stated in either such Registration Statement or Prospectus or necessary
to make the statements made therein not misleading, except insofar as
any such loss, damage, expense, liability or claim arises out of or is
based upon any untrue statement or alleged untrue statement of a
material fact contained in and in conformity with information furnished
in writing by or on behalf of any Underwriter through you to the Trust
or the Adviser, expressly for use with reference to such Underwriter in
such Registration Statement or such Prospectus or arises out of or is
based upon any omission or alleged omission to state a material fact in
connection with such information required to be stated in such
Registration Statement or such Prospectus or necessary to make such
information not misleading, PROVIDED, HOWEVER, that the indemnity
agreement contained in this subsection (a) with respect to any
preliminary prospectus or amended preliminary prospectus shall not inure
to the benefit of any Underwriter (or to the benefit of any person
controlling such Underwriter) from whom the person asserting any such
loss, damage, expense, liability or claim purchased the Shares which is
the subject thereof if the Prospectus corrected any such alleged untrue
statement or omission and if such Underwriter failed to send or give a
copy of the Prospectus to such person at or prior to the written
confirmation of the sale of such Shares to such person, unless the
failure is the result of noncompliance by the Company with paragraph (h)
of Section 4 hereof.
If any action, suit or proceeding (together, a "Proceeding") is
brought against an Underwriter or any such person in respect of which
indemnity may be sought against the Trust or the Advisers pursuant to
the foregoing paragraph, such Underwriter or such person shall promptly
notify the Trust and the Advisers in writing of the institution of such
Proceeding and the Trust or the Advisers shall assume the defense of
such Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees and
expenses; PROVIDED, HOWEVER, that the omission to so notify the Trust or
the Advisers shall not relieve the Trust or the Advisers from any
liability which the Trust or the Advisers may have to any Underwriter or
any such person or otherwise. Such Underwriter or such person shall have
the right to employ its or their own counsel in any such case, but the
fees and expenses of such counsel shall be at the expense of such
Underwriter or of such person unless the employment of such counsel
shall have been authorized in writing by the Trust or the Advisers, as
the case may be, in connection with the defense of such Proceeding or
the Trust or the Advisers shall not have, within a reasonable period of
time in light of the circumstances, employed counsel to have charge of
the defense of such Proceeding or such indemnified party or parties
shall have reasonably concluded that there may be defenses available to
it or them which are different from, additional to or in conflict with
those available to the Trust or the Advisers (in which case neither the
Trust nor the Advisers shall have the right to direct the defense of
such Proceeding on behalf of the indemnified party or parties), in any
of which events such fees and expenses shall be borne by the Trust or
the Advisers and paid as incurred (it being understood, however, that
the Trust or the Advisers shall not be liable for the expenses of more
than one separate counsel (in addition to any local counsel) in any one
Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such
Proceeding). Neither the Trust nor the Adviser shall be liable for any
settlement of any Proceeding effected without its written consent but if
settled with the written consent of the Trust or the Advisers, the Trust
or the Advisers, as the case may be, agree to indemnify and hold
harmless any Underwriter and any such person from and against any loss
or liability by reason of such settlement. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and
expenses of counsel as contemplated by the second sentence of this
paragraph, then the indemnifying party agrees that it shall be liable
for any settlement of any
- 17 -
Proceeding effected without its written consent if (i) such settlement
is entered into more than 60 business days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with
such request prior to the date of such settlement and (iii) such
indemnified party shall have given the indemnifying party at least 30
days' prior notice of its intention to settle. No indemnifying party
shall, without the prior written consent of the indemnified party,
effect any settlement of any pending or threatened 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 on claims that are the subject
matter of such Proceeding and does not include an admission of fault,
culpability or a failure to act, by or on behalf of such indemnified
party.
(b) Each Underwriter severally agrees to indemnify, defend
and hold harmless the Trust and the Advisers, and each of their
respective trustees, directors and officers, and any person who controls
the Trust or the Advisers within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and the successors and assigns of all of
the foregoing persons from and against any loss, damage, expense,
liability or claim (including the reasonable cost of investigation)
which, jointly or severally, the Trust or the Advisers or any such
person may incur under the Act, the Exchange Act, the common law or
otherwise, insofar as such loss, damage, expense, liability or claim
arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in and in conformity with
information furnished in writing by or on behalf of such Underwriter
through you to the Trust or the Advisers expressly for use with
reference to such Underwriter in the Registration Statement (or in the
Registration Statement as amended by any post-effective amendment
thereof by the Trust) or in a Prospectus, or arises out of or is based
upon any omission or alleged omission to state a material fact in
connection with such information required to be stated in such
Registration Statement or such Prospectus or necessary to make such
information not misleading.
If any Proceeding is brought against the Trust, the Advisers or
any such person in respect of which indemnity may be sought against any
Underwriter pursuant to the foregoing paragraph, the Trust, the Advisers
or such person shall promptly notify such Underwriter in writing of the
institution of such Proceeding and such Underwriter shall assume the
defense of such Proceeding, including the employment of counsel
reasonably satisfactory to such indemnified party and payment of all
fees and expenses; PROVIDED, HOWEVER, that the omission to so notify
such Underwriter shall not relieve such Underwriter from any liability
which such Underwriter may have to the Trust, the Advisers or any such
person or otherwise. The Trust, the Advisers or such person shall have
the right to employ its own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of the Trust, the
Advisers or such person unless the employment of such counsel shall have
been authorized in writing by such Underwriter in connection with the
defense of such Proceeding or such Underwriter shall not have, within a
reasonable period of time in light of the circumstances, employed
counsel to have charge of the defense of such Proceeding or such
indemnified party or parties shall have reasonably concluded that there
may be defenses available to it or them which are different from or
additional to or in conflict with those available to such Underwriter
(in which case such Underwriter shall not have the right to direct the
defense of such Proceeding on behalf of the indemnified party or
parties, but such Underwriter may employ counsel and participate in the
defense thereof but the fees and expenses of such counsel shall be at
the expense of such Underwriter), in any of which events such fees and
expenses shall be borne by such Underwriter and paid as incurred (it
being understood, however, that such Underwriter shall not be liable for
the expenses of more than one separate counsel (in addition to any local
counsel) in any one Proceeding or series of related Proceedings in the
same jurisdiction representing the indemnified parties who are parties
to such
- 18 -
Proceeding). No Underwriter shall be liable for any settlement of any
such Proceeding effected without the written consent of such Underwriter
but if settled with the written consent of such Underwriter, such
Underwriter agrees to indemnify and hold harmless the Trust, the
Advisers and any such person from and against any loss or liability by
reason of such settlement. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel as
contemplated by the second sentence of this paragraph, then the
indemnifying party agrees that it shall be liable for any settlement of
any Proceeding effected without its written consent if (i) such
settlement is entered into more than 60 business days after receipt by
such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with
such request prior to the date of such settlement and (iii) such
indemnified party shall have given the indemnifying party at least 30
days' prior notice of its intention to settle. No indemnifying party
shall, without the prior written consent of the indemnified party,
effect any settlement of any pending or threatened 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 on claims that are the subject
matter of such Proceeding.
(c) In addition to the foregoing indemnification, the Trust
and the Advisers also, jointly and severally, agree to indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act, against any and all loss, liability, claim, damage
and expense described in the indemnity contained in Section 9(a), as
limited by the proviso set forth therein, with respect to any sales
material.
(d) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subsections (a) and (b) of
this Section 9 in respect of any losses, damages, expenses, liabilities
or claims referred to therein, then each applicable 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, damages, expenses, liabilities or claims (i) in such proportion
as is appropriate to reflect the relative benefits received by the Trust
and the Advisers on the one hand and the Underwriters on the other hand
from the offering of the 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 Trust and the
Advisers on the one hand and of the Underwriters on the other in
connection with the statements or omissions which resulted in such
losses, damages, expenses, liabilities or claims, as well as any other
relevant equitable considerations. The relative benefits received by the
Trust and the Advisers on the one hand and the Underwriters on the other
shall be deemed to be in the same respective proportions as the total
proceeds from the offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Trust and the
total underwriting discounts and commissions received by the
Underwriters, bear to the aggregate public offering price of the Shares.
The relative fault of the Trust and the Advisers on the one hand and of
the Underwriters on the other shall be determined by reference to, among
other things, whether the untrue statement or alleged untrue statement
of a material fact or omission or alleged omission relates to
information supplied by the Trust or the Advisors or by the Underwriters
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, damages, expenses,
liabilities and claims referred to in this subsection shall be deemed to
include any legal or other fees or expenses reasonably incurred by such
party in connection with investigating, preparing to defend or defending
any Proceeding.
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(e) The Trust, the Advisers 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 subsection (c) above. 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
at which the Shares underwritten by such Underwriter and distributed to
the public were offered to the public exceeds the amount of any damage
which such Underwriter has otherwise been required to pay by reason of
such untrue statement or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) 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 their respective underwriting commitments
and not joint.
(f) The indemnity and contribution agreements contained in
this Section 9 and the covenants, warranties and representations of the
Trust contained in this Agreement shall remain in full force and effect
regardless of any investigation made by or on behalf of any Underwriter,
its partners, directors or officers or any person (including each
partner, officer or director of such person) who controls any
Underwriter within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, or by or on behalf of the Trust or the Advisers, its
trustees, directors or officers or any person who controls the Trust or
the Advisers within the meaning of Section 15 of the Act or Section 20
of the Exchange Act, and shall survive any termination of this Agreement
or the issuance and delivery of the Shares. The Trust and the Advisers
and each Underwriter agree promptly to notify each other of the
commencement of any Proceeding against it and, in the case of the Trust,
against any of the Trust's or the Advisers' trustees, officers or
directors in connection with the issuance and sale of the Shares, or in
connection with the Registration Statement or Prospectus.
10. NOTICES. Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by telegram and, if to
the Underwriters, shall be sufficient in all respects if delivered or sent to
UBS Warburg LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, X.X. 00000-0000, Attention:
Syndicate Department and, if to the Trust or Advisers, shall be sufficient in
all respects if delivered or sent to the Trust at the offices of BlackRock
Financial Management, Inc. at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxx X. Xxxxxxxxxxx.
00. GOVERNING LAW; CONSTRUCTION. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The Section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
12. SUBMISSION TO JURISDICTION. Except as set forth below, no Claim
may be commenced, prosecuted or continued in any court other than the courts of
the State of New York located in the City and County of New York or in the
United States District Court for the Southern District of New York, which courts
shall have jurisdiction over the adjudication of such matters, and the Trust and
Advisers consent to the jurisdiction of such courts and personal service with
respect thereto. The Trust and Advisers hereby consent to personal jurisdiction,
service and venue in any court in which any Claim arising out of or in any way
relating to this Agreement is brought by any third party against UBS Warburg LLC
or any indemnified party. Each of UBS Warburg LLC and the Trust and Advisers (on
its behalf and, to the extent permitted by applicable law, on behalf of its
stockholders and affiliates) waives all right to trial by jury in any action,
proceeding or counterclaim (whether based upon contract, tort or otherwise) in
- 20 -
any way arising out of or relating to this Agreement. The Trust and Advisers
agree that a final judgment in any such action, proceeding or counterclaim
brought in any such court shall be conclusive and binding upon the Trust or the
Advisers, as the case may be, and may be enforced in any other courts in the
jurisdiction of which the Trust or the Advisers, as the case may be, is or may
be subject, by suit upon such judgment.
13. PARTIES AT INTEREST. The Agreement herein set forth has been and
is made solely for the benefit of the Underwriters and the Trust and the
Advisers and to the extent provided in Section 9 hereof the controlling persons,
directors and officers referred to in such section, and their respective
successors, assigns, heirs, personal representatives and executors and
administrators. No other person, partnership, association or corporation
(including a purchaser, as such purchaser, from any of the Underwriters) shall
acquire or have any right under or by virtue of this Agreement.
14. COUNTERPARTS. This Agreement may be signed by the parties in one
or more counterparts which together shall constitute one and the same agreement
among the parties.
15. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Underwriters and the Trust and the Advisers and their successors and assigns and
any successor or assign of any substantial portion of the Trust's and the
Advisers' and any of the Underwriters' respective businesses and/or assets.
- 21 -
If the foregoing correctly sets forth the understanding among
the Trust, the Advisers and the Underwriters, please so indicate in the space
provided below for the purpose, whereupon this letter and your acceptance shall
constitute a binding agreement among the Trust, the Advisers and the
Underwriters, severally.
Very truly yours,
BlackRock Core Bond Trust
By:
-------------------------------------
Name:
Title:
BlackRock Advisors, Inc.
By:
-------------------------------------
Name:
Title:
BlackRock Financial Management, Inc.
By:
-------------------------------------
Name:
Title:
Accepted and agreed to as of the
date first above written, on
behalf of itself and the
other several Underwriters
named in Schedule A
UBS WARBURG LLC
By: UBS WARBURG LLC
By:
--------------------------
Name:
Title:
- 22 -
SCHEDULE A
NUMBER OF
UNDERWRITER FIRM SHARES
----------- -----------
UBS Warburg LLC................................................
Deutsche Banc Alex. Xxxxx Inc..................................
Prudential Securities Incorporated.............................
First Union Securities, Inc....................................
Gruntal & Co., L.L.C...........................................
J.J.B. Xxxxxxxx, X.X. Xxxxx, Inc...............................
Xxxxx Fargo Xxx Xxxxxx, LLC....................................
Total.................................................
A-1
Exhibit A
FORM OF OPINION OF TRUST'S AND ADVISERS'
COUNSEL TO BE DELIVERED PURSUANT TO
SECTION 6(e)
(A) With respect to the Trust:
(i) The Trust has been duly organized and is validly
existing as a business trust in good standing under the laws of
the State of Delaware.
(ii) The Trust has business trust power and authority
to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and
perform its obligations under the Purchase Agreement.
(iii) The Trust is duly qualified as a foreign
business trust to transact business and is in good standing in
each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse
Effect.
(iv) To the best of our knowledge, the Trust does not
have any subsidiaries.
(v) The authorized, issued and outstanding shares of
beneficial interest of the Trust is as set forth in the
Prospectus under the caption "Description of shares -- Common
Shares" (except for subsequent issuances, if any, pursuant to
the Purchase Agreement); all issued and outstanding shares of
beneficial interest of the Trust have been duly authorized and
validly issued and are fully paid and non-assessable, except as
provided for in the Trust's declaration of trust, and have been
offered and sold or exchanged by the Trust in compliance with
all applicable laws (including, without limitation, federal and
state securities laws); the Shares conform as to legal matters
to all statements relating thereto contained in the Prospectus
and such description conforms to the rights set forth in the
instruments defining the same; and none of the outstanding
shares of beneficial interest of the Trust was issued in
violation of the preemptive or other similar rights of any
securityholder of the Trust.
(vi) The Shares to be purchased by the Underwriters
from the Trust have been duly authorized for issuance and sale
to the Underwriters pursuant to the Purchase Agreement and, when
issued and delivered by the Trust pursuant to the Purchase
Agreement against payment of the consideration set forth in the
Purchase Agreement, will be validly issued and fully paid and
non-assessable, except as provided for in the Trust's
declaration of trust, and no holder of the Shares is or will be
subject to personal liability by reason of being such a holder.
(vii) The issuance of the Shares is not subject to
preemptive or other similar rights of any securityholder of the
Trust.
(viii) The Purchase Agreement has been duly authorized,
executed and delivered by the Trust.
(ix) The Registration Statement, including any Rule
462(b) Registration Statement, has been declared effective under
the Act; any required filing of the
A-1
Prospectus pursuant to Rule 497(c) or Rule 497(h) has been made
in the manner and within the time period required by Rule 497;
and, to the best of our knowledge, no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the Act, and, to
the best of our knowledge, no order of suspension or revocation
of registration pursuant to Section 8(e) of the Investment
Company Act has been issued, and no proceedings for any such
purpose have been instituted or are pending or threatened by the
Commission.
(x) The Registration Statement, including any Rule
462(b) Registration Statement, the Rule 430A Information and the
Rule 434 Information, as applicable, the Prospectus and each
amendment or supplement to the Registration Statement and
Prospectus as of their respective effective or issue dates
(other than the financial statements and supporting schedules
included therein or omitted therefrom, as to which we need
express no opinion), and the notification on Form N-8A complied
as to form in all material respects with the requirements of the
Act, the Investment Company Act and the Rules and Regulations.
(xi) If Rule 434 has been relied upon, the Prospectus
was not "materially different," as such term is used in Rule
434, from the prospectus included in the Registration Statement
at the time it became effective.
(xii) The form of certificate used to evidence the
Shares complies in all material respects with all applicable
statutory requirements, with any applicable requirements of the
declaration of trust and by-laws of the Trust and the
requirements of the New York Stock Exchange.
(xiii) To the best of our knowledge, there is not
pending or threatened any action, suit, proceeding, inquiry or
investigation, to which the Trust is a party, or to which the
property of the Trust is subject, before or brought by any court
or governmental agency or body, domestic or foreign, which might
reasonably be expected to result in a Material Adverse Effect,
or which might reasonably be expected to materially and
adversely affect the properties or assets of the Trust or the
consummation of the transactions contemplated in the Purchase
Agreement or the performance by the Trust of its obligations
thereunder.
(xiv) The information in the Prospectus under
"Description of shares" and "Tax matters" and in the
Registration Statement under Item 29 (Indemnification), to the
extent that it constitutes matters of law, summaries of legal
matters, the Trust's declaration of trust and by-laws or legal
proceedings, or legal conclusions, has been reviewed by us and
is correct in all material respects.
(xv) Each of the Management Agreement, the
Sub-Advisory Agreement, the Custodian Agreement, the Transfer
Agency Agreement and the Purchase Agreement comply in all
material respects with all applicable provisions of the
Investment Company Act, Advisers Act, the Rules and Regulations
and the Advisers Act Rules and Regulations.
(xvi) The Trust is duly registered with the Commission
under the Investment Company Act as a closed-end, diversified
management investment company; and, to the best of our
knowledge, no order of suspension or revocation of such
registration has been issued or proceedings therefor initiated
or threatened by the Commission.
A-2
(xvii) To the best of our knowledge, no person is
serving as an officer, trustee or investment adviser of the
Trust except in accordance with the Investment Company Act and
the Rules and Regulations and the Investment Advisers Act and
the Advisers Act Rules and Regulations. Except as disclosed in
the Registration Statement and Prospectus (or any amendment or
supplement to either of them), to the best of our knowledge, no
trustee of the Trust is an "interested person" (as defined in
the Investment Company Act) of the Trust or an "affiliated
person" (as defined in the Investment Company Act) of an
Underwriter.
(xviii) There are no statutes or regulations that are
required to be described in the Prospectus that are not
described as required.
(xix) All descriptions in the Registration Statement
of contracts and other documents to which the Trust is a party
are accurate in all material respects. To the best of our
knowledge, there are no franchises, contracts, indentures,
mortgages, loan agreements, notes, leases or other instruments
required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those
described or referred to therein or filed or incorporated by
reference as exhibits thereto, and the descriptions thereof or
references thereto are correct in all material respects.
(xx) To the best of our knowledge, the Trust is not
in violation of its declaration of trust or by-laws and no
default by the Trust exists in the due performance or observance
of any material obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan agreement,
note, lease or other agreement or instrument that is described
or referred to in the Registration Statement or the Prospectus
or filed or incorporated by reference as an exhibit to the
Registration Statement.
(xxi) No filing with, or authorization, approval,
consent, license, order, registration, qualification or decree
of, any court or governmental authority or agency (other than
under the Act, the 1934 Act, the Investment Company Act and the
Rules and Regulations, which have been obtained, or as may be
required under the securities or blue sky laws of the various
states, as to which we need express no opinion) is necessary or
required in connection with the due authorization, execution and
delivery of the Purchase Agreement or for the offering, issuance
or sale of the Shares or the consummation of the transactions
contemplated by this Agreement.
(xxii) The execution, delivery and performance of the
Purchase Agreement and the consummation of the transactions
contemplated in the Purchase Agreement and in the Registration
Statement (including the issuance and sale of the Shares and the
use of the proceeds from the sale of the Shares as described in
the Prospectus under the caption "Use of Proceeds") and
compliance by the Trust with its obligations under the Purchase
Agreement do not and will not, whether with or without the
giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as
defined in Section 1(a)(xii) of the Purchase Agreement) under or
result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Trust pursuant to
any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or any other agreement or instrument,
known to us, to which the Trust is a party or by which it or any
of them may be bound, or to which any of the property or assets
of the Trust is subject, nor will such action result in any
violation of the provisions of the charter or by-laws of the
Trust, or any applicable law, statute, rule, regulation,
judgment, order, writ or decree, known to us, of any government,
government
A-3
instrumentality or court, domestic or foreign, having
jurisdiction over the Trust or any of its properties, assets or
operations.
(xxiii) The Purchase Agreement, the Management
Agreement, the Sub-Advisory Agreement, the Custodian Agreement
and the Transfer Agency Agreement have each been duly authorized
by all requisite action on the part of the Trust, executed and
delivered by the Trust, as of the dates noted therein. Assuming
due authorization, execution and delivery by the other parties
thereto with respect to the Custodian Agreement and the Transfer
Agency Agreement, each of the Management Agreement, the
Sub-Advisory Agreement, the Custodian Agreement and the Transfer
Agency Agreement constitutes a valid and binding agreement of
the Trust, enforceable in accordance with its terms, except as
affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at
law) and an implied covenant of good faith and fair dealing.
(B) With respect to the Advisers:
(i) Each Adviser has been duly organized and is
validly existing as a corporation in good standing under the
laws of the State of Delaware.
(ii) Each Adviser has full corporate power and
authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and to enter
into and perform its obligations under the Purchase Agreement.
(iii) Each Adviser is duly qualified as a foreign
corporation to transact business and is in good standing in each
other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify
would not result in a Material Adverse Effect.
(iv) Each Adviser is duly registered with the
Commission as an investment adviser under the Advisers Act and
is not prohibited by the Advisers Act, the Advisers Act Rules
and Regulations, the Investment Company Act or the Rules and
Regulations from acting under the Management Agreement for the
Trust as contemplated by the Prospectus.
(v) The Purchase Agreement, the Management Agreement
and the Sub-Advisory Agreement have been duly authorized,
executed and delivered by the respective Adviser, and the
Management Agreement and the Sub-Advisory Agreement each
constitutes a valid and binding obligation of the respective
Adviser, enforceable in accordance with its terms, except as
affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and general equitable
principles (whether considered in a proceeding in equity or at
law).
(vi) To the best of our knowledge, there is not
pending or threatened any action, suit, proceeding, inquiry or
investigation, to which the Advisers are a party, or to which
the property of the Advisers is subject, before or brought by
any court or governmental agency or body, domestic or foreign,
which might reasonably be expected to result in any material
adverse change in the condition, financial or otherwise, in the
A-4
earnings, business affairs or business prospects of the
Advisers, materially and adversely affect the properties or
assets of the Advisers or materially impair or adversely affect
the ability of the Advisers to function as an investment adviser
or perform its obligations under the Management Agreement or the
Sub-Advisory Agreement, or which is required to be disclosed in
the Registration Statement or the Prospectus.
(vii) To the best of our knowledge, there are no
franchises, contracts, indentures, mortgages, loan agreements,
notes, leases or other instruments required to be described or
referred to in the Registration Statement or to be filed as
exhibits thereto other than those described or referred to
therein or filed or incorporated by reference as exhibits
thereto, and the descriptions thereof or references thereto are
correct in all material respects.
(viii) To the best of our knowledge, each Adviser is
not in violation of its certificate of incorporation, by-laws or
other organizational documents and no default by the Advisers
exists in the due performance or observance of any material
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or
other agreement or instrument that is described or referred to
in the Registration Statement or the Prospectus or filed or
incorporated by reference as an exhibit to the Registration
Statement.
(ix) No filing with, or authorization, approval,
consent, license, order, registration, qualification or decree
of, any court or governmental authority or agency, domestic or
foreign (other than under the Act, the Investment Company Act
and the Rules and Regulations, which have been obtained, or as
may be required under the securities or blue sky laws of the
various states, as to which we need express no opinion) is
necessary or required in connection with the due authorization,
execution and delivery of the Purchase Agreement.
(x) The execution, delivery and performance of the
Purchase Agreement and the consummation of the transactions
contemplated in the Purchase Agreement and in the Registration
Statement and compliance by the Advisers with their obligations
under the Purchase Agreement do not and will not, whether with
or without the giving of notice or lapse of time or both,
conflict with or constitute a breach of, or default or Repayment
Event (as defined in Section 1(a)(xii) of the Purchase
Agreement) under or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the
Advisers pursuant to any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, lease or any other
agreement or instrument, known to us, to which the Advisers is a
party or by which it or any of them may be bound, or to which
any of the property or assets of the Advisers is subject (except
for such conflicts, breaches or defaults or liens, charges or
encumbrances that would not have a Material Adverse Effect), nor
will such action result in any violation of the provisions of
the charter or by-laws of the Advisers, or any applicable law,
statute, rule, regulation, judgment, order, writ or decree,
known to us, of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over the
Advisers or any of its properties, assets or operations.
In addition, we have participated in the preparation of the Registration
Statement and the Prospectus and participated in discussions with certain
officers, trustees and employees of the Trust, representatives of Deloitte &
Touche LLP, the independent accountants who examined the statement of assets and
liabilities of the Trust included or incorporated by reference in the
Registration Statement and
A-5
the Prospectus, and you and your representatives and we have reviewed certain
Trust records and documents. While we have not independently verified and are
not passing upon, and do not assume any responsibility for, the accuracy,
completeness or fairness of the information contained in the Registration
Statement and the Prospectus, except to the extent necessary to enable us to
give the opinions with respect to the Trust in paragraphs (A)(v), (xiv) and
(xix), on the basis of such participation and review, nothing has come to our
attention that would lead us to believe that the Registration Statement (except
for financial statements, supporting schedules and other financial data included
therein or omitted therefrom and for statistical information derived from such
financial statements, supporting schedules or other financial data, as to which
we do not express any belief), at the time such Registration Statement became
effective, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus (except for financial
statements, supporting schedules and other financial data included therein or
omitted therefrom and for statistical information derived from such financial
statements, supporting schedules or other financial data, as to which we do not
express any belief), at the time the Prospectus was issued, or at the Closing
Date, included or includes an untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
A-6