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EXHIBIT d(vi)
SUBSCRIPTION, DISTRIBUTION AND ESCROW AGENCY AGREEMENT
This Subscription, Distribution and Escrow Agency Agreement (the
"Agreement") is made as of October 21, 1991 between The Gabelli Equity Trust
Inc., a Maryland Corporation ("Gabelli") and State Street Bank and Trust
Company, a national banking association, as subscription, distribution and
escrow agent ("Agent").
WHEREAS, Gabelli proposes to make a subscription offer by issuing
certificates or other evidences of subscription rights, in the form designated
by Gabelli ("Subscription Certificates") to shareholders of record ("Record Date
Shareholders") of its Common Capital Stock as of a record date specified by
Gabelli (the "Record Date"), pursuant to which each Record Date Shareholder will
have certain rights (the "Rights") to subscribe to shares of Gabelli Common
Capital Stock, par value $.001 ("Common Capital Stock"), as described in and
upon such terms as are set forth in the prospectus (the "Prospectus") included
in the Form N-2 Registration Statement filed by Gabelli with the Securities and
Exchange Commission on September 13, 1991, as amended by any amendment filed
with respect thereto (the "Registration Statement");
WHEREAS, Gabelli wishes the Agent to perform certain acts on behalf of
Gabelli, and the Agent is willing to so act, in connection with the distribution
of the Subscription Certificates and the issuance and exercise of the Rights to
subscribe therein set forth, all upon the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing and of the mutual
agreements set forth herein, the parties agree as follows:
1. Pursuant to resolution of its Board of Directors Gabelli hereby
appoints and authorizes the Agent to act on its behalf in accordance with
the provisions hereof, and the Agent hereby accepts such appointment and
agrees to so act.
2. (a) Each Subscription Certificate shall evidence the Rights of the
Record Date Shareholder therein named to purchase Common Capital Stock upon
the terms and conditions therein and herein set forth.
(b) Upon the written advice of Gabelli, signed by its Chairman,
President, Secretary or Assistant Secretary, as to the Record Date, the
Agent shall, from a list of Gabelli Shareholders as of the Record Date to
be prepared by the Agent in its capacity as Transfer Agent of Gabelli,
prepare and record Subscription Certificates in the names of the Record
Date Shareholders, setting forth the number of Rights to subscribe to
Gabelli Common Capital Stock calculated on the basis of one Right for each
share of Common Capital Stock recorded on the Gabelli books in the name of
each such Record Date Shareholder as of the Record Date. Each Subscription
Certificate shall be dated as of the Record Date and shall be executed
manually or by facsimiles signature of a duly authorized Officer of
Gabelli. Upon the written advice, signed as aforesaid, as to the effective
date of the Registration Statement, the Agent shall as promptly as
practicable countersign and deliver the Subscription Certificates, together
with a copy of the Prospectus, to all Record Date Shareholders. No
Subscription Certificate shall be valid for any purpose unless so executed.
Should any Officer whose signature has been placed upon any Subscription
Certificate cease to hold such office at any time thereafter, such event
shall have no effect on the validity of such Subscription Certificate.
3. (a) Each Subscription Certificate shall be irrevocable and fully
transferable. The Agent shall, in its capacity as Transfer Agent of Gabelli
maintain a register of Subscription Certificates and the holders of record
thereof (each of whom shall be deemed a "Record Date Shareholder" hereunder
for purposes of determining the rights of holders of Subscription
Certificates). Each Subscription Certificate shall, subject to the
provisions thereof, entitle the Record Date Shareholder in whose name it is
recorded to the following:
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(1) The right (the "Basic Subscription Right") to purchase a number
of shares of Common Capital Stock equal to one share of Common Capital
Stock for every six Subscription Rights; provided, however, that no
fractional shares of Common Capital Stock shall be issued; and
(2) The right (the "Oversubscription Right") to purchase from
Gabelli additional shares of Common Capital Stock, subject to the
availability of such shares and to allotment of such shares as may be
available among Record Date Shareholders who exercise Oversubscription
Rights on the basis specified in the Prospectus; provided, however, that
a Record Date Shareholder who has not exercised his Basic Subscription
Rights with respect to the full number of shares that such Record Date
Shareholder is entitled to purchase by virtue of his Basic Subscription
Rights as of the Expiration Date, if any, shall not be entitled to any
Oversubscription Rights.
(b) A Record Date Shareholder may exercise his Basic Subscription
Rights and Oversubscription Rights by delivery to the Agent at its
corporate office specified in the Prospectus of (i) the Subscription
Certificate with respect thereto, duly executed by such Record Date
Shareholder in accordance with and as provided by the terms and conditions
of the Subscription Certificate, together with (ii) the purchase price of
$8.00 for each share of Common Capital Stock subscribed for by exercise of
such Rights, in United States dollars in cash, by check, or bank draft
drawn on a bank in the continental United States or by postal, telegraphic,
or express money order, in each case payable to the order of Gabelli.
(c) Rights may be exercised at any time after the date of issuance
of the Subscription Certificates with respect thereto but no later than
5:00 P.M. Eastern Daylight Time on such date as Gabelli shall designate to
the Agent in writing (the "Expiration Date"). For the purpose of
determining the time of the exercise of any Rights, delivery of any
material to the Agent shall be deemed to occur when such materials are
received at the corporate office of the Agent specified in the Prospectus.
(d) Not withstanding the provisions of Section 3(b) and 3(c)
retarding delivery of an executed Subscription Certificate to the Agent
prior to 5:00 P.M. Eastern Daylight Time on the Expiration Date, if prior
to such time the Agent receives notice of guaranteed delivery by telegram
or otherwise from a bank, trust company or a New York Stock Exchange member
guaranteeing delivery of (i) full payment for shares purchased and
subscribed for by virtue of a Rights Holder's Rights, and (ii) a properly
completed and executed Subscription Certificate, then such exercise of
Basic Subscription Rights and Oversubscription Rights shall be regarded as
timely, subject, however, to receipt of the duly executed Subscription
Certificate and full payment for the Capital Common Stock by the Agent
within five business days after the Expiration Date (as defined in the
Prospectus).
(e) Within five business days following the Expiration Date (the
"Confirmation Date"), the Agent shall send a confirmation to each
Shareholder (or, if shares of Common Capital Stock on the Record Date are
held by Cede & Co. or any other depository or nominee, to Cede & Co. or
such other depository or nominee), showing (i) the number of shares
acquired pursuant to the Basic Subscription Rights, (ii) the number of
shares, if any, acquired pursuant to the Oversubscription Rights, (iii) the
per share and total purchase price for the shares, (iv) any amount payable
to the Shareholder pursuant to Section 9, and (v) any excess to be refunded
by Gabelli to such Shareholder, in each case based on the Subscription
Price. Any excess payment to be refunded by Gabelli to a Shareholder, shall
be mailed by the Agent to the Shareholder within fifteen business days
after the Expiration Date, as provided in Section 6 below.
4. If, after allocation of shares of Common Capital Stock to persons
exercising Basic Subscription Rights, there remain unexercised Rights, then
the Agent shall allot the shares issuable upon exercise of such unexercised
Rights (the "Remaining Shares") to persons exercising Oversubscription
Rights, in the amounts of such oversubscriptions. If the number of shares
for which Oversubscription Rights have been exercised is greater than the
Remaining Shares, the Agent shall allot the Remaining Shares to the persons
exercising Oversubscription Rights pro rata based solely on the number of
Basic Subscription Rights exercised by each of them. The Agent shall advise
Gabelli immediately upon the completion of the allocation set forth above
as to the total number of shares subscribed and distributable.
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5. (a) The Agent, will deliver (i) certificates representing those
shares purchased pursuant to exercise of Basic Subscription Rights as soon
as practicable after the corresponding Rights have been validly exercised
and full payment for such shares has been received and cleared; (ii)
certificates representing those shares purchased pursuant to the exercise
of Oversubscription Rights as soon as practicable after the Expiration Date
and after all allocations have been effected; (iii) in the case of each
Rights Holder whose rights were sold pursuant to Section 9, within fifteen
business days after the Expiration Date, proceeds of such sale (provided,
however, that proceeds of sales on behalf of Record Xxxx Shareholders whose
Subscription Certificates are undeliverable shall be held by the Agent
until they are either claimed or escheated); (iv) in the case of each
Record Date Shareholder who subscribed, pursuant to the exercise of
Oversubscription Rights, for a greater number of shares than was allotted
to such Record Date Shareholder under Section 4, within fifteen business
days after the Expiration Date, a refund (and interest on such) in the
amount of the difference between the purchase price delivered for the
shares subscribed for pursuant to the exercise of such Oversubscription
Rights and the purchase price of the shares so allotted under Section 4 (an
"Excess Payment").
6. (a) All proceeds received by the Agent from Rights holders in
respect of the exercise of rights shall be held by the Agent, on behalf of
Gabelli, in a segregated, interest-bearing escrow account (the "Escrow
Account"). Pending disbursement in the manner described in Section 6(b)
below, Funds held in the Escrow Account shall be invested by the Agent at
the direction of Gabelli.
(b) The Agent shall deliver all proceeds received in respect of this
exercise of the Rights (including interest earned thereon) to Gabelli as
promptly as practicable, but in no event later than fifteen business days
after the Confirmation Date. Proceeds held in respect of Excess Payments
(including interest earned thereon) shall be refunded to Record Date
Shareholders entitled to such a refund within fifteen business days after
the Expiration Date.
7. The Agent shall promptly advise Gabelli as to the date of delivery
of Common Capital Stock hereunder and shall supply Gabelli with a certified
list of Shareholders as of the Record Date.
8. The Agent shall account promptly to Gabelli with respect to Rights
exercised and concurrently account for all monies received and returned by
the Agent with respect to the purchase of shares of Common Capital Stock
upon the exercise of Rights.
9. The Agent shall use its best efforts to sell on the New York Stock
Exchange, on the terms set forth in the Prospectus, (i) all Rights
submitted to it for sale by Rights Holders in accordance with the
Prospectus, provided such Rights are received by the Agent at least one day
prior to the Expiration Date, (ii) all Rights of Record Date Shareholders
whose Subscription Certificates remain unclaimed as a result of being
returned by postal authorities as undeliverable as of one business day
prior to the Expiration Date, and (iii) all rights a Rights Holder is
unable to exercise because such rights represent the right to subscribe for
less than one share. Such sales will be made through a broker or brokers
selected by the Subscription Agent, and the Agent shall deliver the
proceeds of such sales to the Rights Holder net of commissions charged by
such broker or brokers.
10. In the event the Agent does not receive, within five business days
after the Expiration Date, any amount due from a Rights Holder as specified
in Section 3(e), then it shall take such action with respect to such Rights
Holder's Subscription Rights as may be instructed in writing by Gabelli,
including without limitation (i) applying any payment actually received by
it toward the purchase of the greatest whole number of shares of Common
Capital Stock which could be acquired with such payment, (ii) allocating
the shares subject to such Subscription Rights to one or more other Record
Date Shareholders, and (iii) selling all or a portion of the shares of
Common Capital Stock deliverable upon exercise of such Subscription Rights
on the open market, and applying the proceeds thereof to the amount owed.
11. No Subscription Certificate shall entitle a Rights Holder to vote
or receive dividends or be deemed the holder of shares of Common Capital
Stock for any purpose, nor shall anything contained in any Subscription
Certificate be construed to confer upon any Rights Holder any of the rights
of a shareholder of Gabelli or any right to vote, give or withhold consent
to any action by Gabelli (whether
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upon any recapitalization, issue of stock, reclassification of stock,
consolidation, merger, conveyance or otherwise), receive notice of meetings
of other action affecting shareholders, or receive dividends or otherwise,
until the Rights evidenced thereby shall have been exercised and the shares
of Common Capital Stock purchasable upon the exercise thereof shall have
become deliverable as provided in this Agreement and in the Prospectus.
12. If any Subscription Certificate is lost, stolen, mutilated, or
destroyed the Agent may, on such terms which will indemnify Gabelli as the
Agent may in its discretion impose (which shall, in the case of a
Subscription Certificate include the surrender thereof), issue a new
Subscription Certificate of like denomination in substitution for the
Subscription Certificate so lost, stolen or mutilated or destroyed.
13. (a) Gabelli covenants that all shares of Common Capital Stock
issued on exercise of Rights set forth in the Subscription Certificates
will be validly issued, fully paid, nonassessable and free of preemptive
rights.
(b) Gabelli shall furnish to the Agent, upon request, an opinion
of counsel satisfactory to the Agent to the effect that a registration
statement under the Securities Act of 1933, as amended (the "Act"), is then
in effect with respect to its shares of Common Capital Stock issuable upon
exercise of the Rights set forth in the Subscription Certificates. Upon
written advice to the Agent that the Securities and Exchange Commission
shall have issued or threatened to have issued any order preventing or
suspending the use of the Prospectus, or if for any reason it shall be
necessary to amend or supplement the Prospectus in order to comply with the
Act, the Agent shall cease acting hereunder until receipt of written
instructions from Gabelli and such assurances as it may reasonably request
that it may comply with such instruction without violations of the Act.
14. (a) Any corporation into which the Agent may be merged or
converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Agent
shall be a party, or any corporation succeeding to the corporate trust
business of the Agent, shall be the successor to the Agent hereunder
without the execution or filing of any of the parties hereto, provided that
such corporation would be eligible for appointment as a successor Agent. In
case at the time such successor to the Agent shall succeed to the agency
created by this Agreement, any of the Subscription Certificates shall have
been countersigned but not delivered, any such successor to the Agent may
adopt the countersignature of the original Agent and deliver such
Subscription Certificates so countersigned, and in case at that time any of
the Subscription Certificates shall not have been countersigned, any
successor to the Agent may countersign such Subscription Certificates
either in the name of the predecessor Agent or in the name of the successor
Agent, and in all such cases such Subscription Certificates shall have the
full force provided in the Subscription Certificates and in this Agreement.
(b) In case at any time the name of the Agent shall be changed and
at such time any of the Subscription Certificates shall have been
countersigned but not delivered, the Agent may adopt the countersignature
under its prior name and deliver Subscription Certificates so
countersigned, and in case at that time any of the Subscription
Certificates shall not have been countersigned, the Agent may countersign
such Subscription Certificates either in its prior name or in its changed
name, and in all such cases such Subscription Certificates shall have the
full force provided in the Subscription Certificates and in this Agreement.
15. Gabelli agrees to pay to the Agent from time to time, on demand of
the Agent, reasonable compensation for all services rendered by it
hereunder and also its reasonable expenses and other disbursements incurred
in the administration and execution of this Agreement and the exercise and
performance of its duties hereunder.
16. The Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions:
(a) Whenever in the performance of its duties under this Agreement
the Agent shall deem it necessary or desirable that any fact or matter be
proved or established, prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof is herein
specifically
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prescribed) may be deemed to be conclusively proved and established by a
certificate signed by the Chairman of the Board or President or a Vice
President or the Secretary or Assistant Secretary or the Treasurer of
Gabelli delivered to the Agent, and such certificate shall be full
authorization to the Agent for any action taken or suffered in good faith
by it under the provisions of this Agreement in reliance upon such
certificate.
(b) The Agent shall not be responsible for and Gabelli shall
indemnify and hold the Agent harmless from and against, any and all losses,
damages, costs, charges, counsel fees, payments, expenses and liability
arising out of or attributable to all actions of the Agent or its agents or
subcontractors required to be taken pursuant to this Agreement, provided
that such actions are taken in good faith and without negligence or willful
misconduct.
(c) The Agent shall be liable hereunder only for its own
negligence or willful misconduct.
(d) Nothing herein shall preclude the Agent from acting in any
other capacity for Gabelli or for any other legal entity.
(e) The Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from
any officer or assistant officer of Gabelli and to apply to any such
officer of Gabelli for advice or instructions in connection with its
duties, and shall be indemnified and not be liable for any action taken or
suffered by it in good faith in accordance with instructions of any officer
or assistant officer.
(f) The Agent shall be indemnified and shall incur no liability
for or in respect of any action taken, suffered, or omitted by it in
reliance upon any Subscription Certificate or certificate for Common
Capital Stock, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate,
statement, or other paper or document that it reasonably believes to be
genuine and to be signed, executed and, where necessary, verified or
acknowledged, by the proper person or persons.
(g) Neither party to this Agreement shall be liable to the other
party for consequential damages under any provision of this Agreement of
for any consequential damages arising out of any act or failure to act
hereunder.
17. The Agent, may without the consent or concurrence of the
Shareholders in whose names Subscription Certificates are registered, by
supplemental agreement or otherwise, concur with Gabelli in making any
changes or corrections in a Subscription Certificate that it shall have
been advised by counsel (who may be counsel for Gabelli) is appropriate to
cure any ambiguity or to correct any defective or inconsistent provision or
clerical omission or mistake or manifest error therein or herein contained,
and which shall not be inconsistent with the provisions of the Subscription
Certificate except insofar as any such change may confer additional rights
upon the Rights Holders.
18. Assignment
a. Except as provided in Section c below, neither this Agreement
nor any rights or obligations hereunder may be assigned by
either party without the written consent of the other party.
b. This Agreement shall inure to the benefit of and be binding upon
the parties and their respective permitted successors and
assigns.
c. The Agent may, without further consent on the part of Gabelli,
subcontract for the performance hereof with (i) Boston Financial
Data Services, Inc., a Massachusetts corporation ("BFDS") which
is duly registered as a transfer agent pursuant to Section
17(c)(1) of the Securities Exchange Act of 1934 ("Section
A(c)(1)"), or (ii) the current third party vendor utilized by
BFDS; provided, however, that the Agent shall be as fully
responsible to Gabelli for the acts and omissions of any
subcontractor as it is for its own acts and omissions.
19. All the covenants and provisions of this Agreement by or for the
benefit of Gabelli, or the Agent shall bind and insure to the benefit of
their respective successors and assigns hereunder.
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20. The validity, interpretation and performance of this Agreement
shall be governed by the law of the Commonwealth of Massachusetts.
STATE STREET BANK AND TRUST COMPANY THE GABELLI EQUITY TRUST, INC.
By: By:
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Vice President Vice President
Dated:
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