Exhibit 99(H)(1)
[_____] Shares
RMR ASIA PACIFIC REAL ESTATE FUND
Common Shares of Beneficial Interest
($0.001 Par Value)
FORM OF UNDERWRITING AGREEMENT
May __, 2006
RBC Capital Markets Corporation
As the Representative of the several
underwriters named in Schedule I hereto
c/o RBC Capital Markets
One Liberty Plaza
000 Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Ladies and Gentlemen:
Each of RMR Asia Pacific Real Estate Fund, a Massachusetts business trust
(the "Company"), its investment adviser, RMR Advisors, Inc., a Massachusetts
corporation (the "Investment Advisor") and its investment sub-adviser,
MacarthurCook Investment Managers Ltd. (the "Sub-Advisor") (each, an "Advisor"
and together, the "Advisors") confirms its agreement with RBC Capital Markets
Corporation ("RBC") and the several underwriters (collectively with RBC, the
"Underwriters") named in SCHEDULE I hereto for which RBC is acting as
Representative (the "Representative") with respect to the issue and sale by the
Company and the purchase by the Underwriters, acting severally and not jointly,
of an aggregate of [______] shares of the Company's Common Shares of Beneficial
Interest ("Common Shares"), $0.001 par value (the "Firm Shares") and with
respect to the grant by the Company to the Underwriters, acting severally and
not jointly, of the option described below to purchase all or part of the
[_____] additional Common Shares (the "Option Shares", and together with the
Firm Shares, the "Shares") for the sole purpose of covering over-allotments, if
any. The respective amounts of the Firm Shares to be so purchased by the several
Underwriters are set forth opposite their names in SCHEDULE I hereto.
The Company has entered into an Investment Advisory Agreement with the
Advisor dated [_____], 2006 (the "Advisory Agreement"), an Administration
Agreement dated [____], 2006 with the Advisor (the "Administration Agreement"),
and a custody agreement with State Street Bank and Trust Company dated [_____],
2006 (the "Custody Agreement"). The Company's Board of Trustees on
[_____________], 2006 also approved the Terms and Conditions of Appointment of
Xxxxx Fargo Bank, N.A. as transfer agent and registrar for the
Company (the "Transfer Agent Terms and Conditions"). The Adviser has entered
into a sub-administration agreement with State Street Bank and Trust Company
dates [_______] (the "Sub-administration Agreement"). The Company and the
Advisor have entered into an Investment Sub-Advisory Agreement with
MacarthurCook dated [_____], 2006 (the "Sub-advisory Agreement"). In addition,
the Company has adopted a dividend reinvestment plan (the "Dividend Reinvestment
Plan"), pursuant to which holders of Shares shall have their dividends
automatically reinvested in additional Common Shares of the Company unless they
elect to receive such dividends in cash. Collectively, this Agreement, the
Advisory Agreement, the Administration Agreement, the Custody Agreement, the
Transfer Agent Terms and Conditions the Sub-administration Agreement and the
Dividend Reinvestment Plan are referred to herein as the "Company Agreements."
The Additional Compensation Agreement with RBC dated [_____], 2006, each of the
Company Agreements to which the Advisor is a party and this Agreement are
collectively referred to herein as the "Advisor Agreements."
The Company has prepared a registration statement on Form N-2 (File Nos.
811-21856 and 333-131944) with respect to the Shares pursuant to the Securities
Act of 1933, as amended (the "Securities Act"), the Investment Company Act of
1940, as amended (the "1940 Act", and collectively with the Securities Act, the
"Acts") and the rules and regulations (the "Rules and Regulations") of the
United States Securities and Exchange Commission (the "Commission") promulgated
under the Securities Act and the 1940 Act. As used in this Agreement, "Effective
Time" means the date and the time as of which such registration statement, or
the most recent post-effective amendment thereto, if any, was declared effective
by the Commission; "Effective Date" means the date of the Effective Time;
"Preliminary Prospectus" means each prospectus included in such registration
statement, or amendment thereof, before it became effective under the Securities
Act and any prospectus filed with the Commission by the Company with the consent
of the Underwriters pursuant to Rule 497(a) of the Rules and Regulations;
"Pricing Prospectus" means the Preliminary Prospectus that was included in the
Registration Statement immediately prior to the Applicable Time (as defined
below); "Prospectus" means the prospectus (including the statement of additional
information) filed by the Company with the Commission (i) pursuant to rule
497(h) under the Securities Act on or before the second business day after the
date hereof (or such earlier time as may be required under the Securities Act)
or (ii) pursuant 497(b) under the Securities Act on or before the fifth business
day after the date hereof (or such earlier time as may be required under the
Securities Act) or, if no such filing is required, the final prospectus
(including the final statement of additional information) included in the
Registration Statement at the Effective Time; "Registration Statement" means
such registration statement, as amended at the Effective Time, including all
information deemed to be a part of the registration statement as of the
Effective Time pursuant to Rule 430A of the Rules and Regulations. If the
Company has filed an abbreviated registration statement to register additional
Common Shares pursuant to Rule 462(b) under the Securities Act (the "Rule 462
Registration Statement"), then any reference herein to the term "Registration
Statement" shall be deemed to include such Rule 462 Registration Statement. For
the purpose of this Agreement, the "Applicable Time" is [_______] pm (Eastern
time) on the date of this Agreement.
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the parties
hereto agree as follows:
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1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each of the Underwriters as of the
date hereof, as of the Closing Date and each Option Closing Date, if any (each
as defined in Section 2 below):
(a) A registration statement has been filed with the Commission under
the Securities Act and has become effective under the Securities Act. No stop
order suspending the effectiveness of such registration statement is in effect,
and no proceedings for such purpose are pending before or, to the knowledge of
the Company, threatened by the Commission. The Commission has not issued any
order preventing or suspending the use of any Preliminary Prospectus. Copies of
such registration statement and each of the amendments thereto have been
delivered by the Company to you. The Registration Statement conforms, and any
further amendments or supplements to the Registration Statement will conform, in
all material respects to the requirements of the Acts and the Rules and
Regulations. The Prospectus and the Pricing Prospectus each conforms and, as
amended or supplemented, will conform, in all material respects to the
requirements of the Acts and the Rules and Regulations. As of the Effective
Date, the date hereof, the Closing Date (as defined below) and each Option
Closing Date (as defined below), if any, the Registration Statement does not and
will not, and any further amendments to the Registration Statement will not,
when they become effective, 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 statement therein not misleading; as of its date and the date hereof, the
Prospectus does not, and as amended or supplemented on the Closing Date and each
Option Closing Date, if any, will not, contain an untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
the Pricing Prospectus taken together with the final pricing information
included on the cover page of the Prospectus (collectively, the "Disclosure
Package"), as of the Applicable Time, did not include any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the Company makes no
representations or warranties as to information contained in or omitted from the
Registration Statement or the Prospectus, or any such amendment or supplement,
in reliance upon, and in conformity with, written information furnished to the
Company by or on behalf of any Underwriter through the Representatives,
specifically for use in the preparation thereof.
(b) A notification of registration of the Company as an investment
company under the 1940 Act on Form N-8A (the "1940 Act Notification") has been
prepared by the Company in conformity with the 1940 Act and has been filed with
the Commission.
(c) The Commission has neither issued an order preventing or
suspending the use of any Prospectus relating to the proposed offering of the
Shares nor instituted proceedings for that purpose, and no proceedings for any
such purpose have been instituted or are pending or, to the knowledge of the
Company or either Advisor, are contemplated by the Commission. The 1940 Act
Notification complied in all material respects with the requirements of the 1940
Act and the Rules and Regulations thereunder and did not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading.
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(d) This Agreement and each of the other Company Agreements has been
duly authorized, executed and delivered by the Company, and assuming due
authorization, execution and delivery by the other parties thereto, constitutes
a valid, legal, and binding obligation of the Company, enforceable in accordance
with its terms. The Company has full power and authority to enter into this
Agreement and each of the Company Agreements and to authorize, issue and sell
the Shares as contemplated by this Agreement.
(e) The Company has been duly formed and is validly existing under the
laws of the Commonwealth of Massachusetts as a trust with transferable shares of
the type commonly called a Massachusetts business trust. The Declaration of
Trust of the Company (the "Declaration of Trust"), pursuant to which the Company
was established, confers upon the Trustees named therein, and their successors
in trust, power and authority to own or lease its properties and conduct its
business as described in the Prospectus and the Disclosure Package. The Company
has no direct or indirect subsidiaries. The Company is duly qualified to
transact business and is in good standing in all jurisdictions in which the
conduct of its business requires such qualification; except where the failure to
be so qualified or to be in good standing would not have a material adverse
effect on the condition (financial or otherwise), properties, assets,
liabilities, rights, operations, earnings, business, management or prospects of
the Company, whether or not arising from transactions in the ordinary course of
business (a "Material Adverse Effect").
(f) The outstanding Common Shares of the Company have been duly
authorized and validly issued and are fully paid and non-assessable (except as
described in the Registration Statement and the Disclosure Package); the Shares
to be issued and sold by the Company have been duly authorized and when issued
and delivered to and paid for as contemplated herein will be validly issued,
fully paid and non-assessable (except as described in the Registration Statement
and the Disclosure Package); and no preemptive rights of shareholders exist with
respect to any of the Shares or the issue and sale thereof. Neither the filing
of the Registration Statement nor the offering or sale of the Shares as
contemplated by this Agreement gives rise to any rights, other than those which
have been waived or satisfied, for or relating to the registration of any Common
Shares.
(g) The Company has authorized capital as set forth in the Prospectus
and the Disclosure Package. All of the Shares conform in all material respects
to the description thereof contained in the Prospectus and the Disclosure
Package. The certificates, if any, for the Shares are in valid and sufficient
form. Immediately after the issuance and sale of the Shares to the Underwriters,
no preferred shares of the Company shall be issued and outstanding and no holder
of any shares, securities convertible into or exchangeable or exercisable for
shares or options, warrants or other rights to purchase shares or any other
securities of the Company shall have any existing or future right to acquire any
preferred shares of the Company. No holders of securities of the Company have
rights to the registration of such securities under the Registration Statement.
(h) The Company has not distributed and, prior to the later to occur
of (i) the Closing Date and (ii) completion of the distribution of the Shares,
will not distribute any prospectus or other offering material in connection with
the offering and sale of the Shares other
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than the Registration Statement, any Preliminary Prospectus, the Prospectus, the
Disclosure Package or other materials permitted by the Acts to be distributed by
the Company.
(i) The financial statements of the Company, together with related
notes and schedules as set forth or incorporated by reference in the
Registration Statement, Prospectus and the Disclosure Package present fairly in
all material respects the financial position of the Company at the indicated
dates. Such financial statements and related schedules have been prepared in
accordance with U.S. generally accepted accounting principles, consistently
applied throughout the periods involved, except as disclosed therein. The
summary financial and statistical data included or incorporated by reference in
the Registration Statement, Prospectus and the Disclosure Package presents
fairly the information shown therein and such data has been compiled on a basis
consistent with the financial statements presented therein and the books and
records of the Company.
(j) The Company maintains, or causes its custodian, State Street Bank
and Trust Company, to maintain, a system of internal controls reasonably
designed to ensure that (i) transactions are executed in accordance with
management's general or specific authorization and in accordance with the 1940
Act; (ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting principles
and to maintain accountability for assets and to maintain compliance with the
books and records requirements under the 1940 Act; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(k) Ernst & Young, LLP, which has certified, or will certify, certain
financial statements of the Company and delivered its opinion with respect to
the financial statements and schedules included or incorporated by reference in
the Registration Statement and the Prospectus, has represented to the Company
that it is an independent registered public accounting firm with respect to the
Company within the meaning of the Acts and the Rules and Regulations.
(l) There is no action, suit, claim, investigation, inquiry or
proceeding pending or, to the knowledge of the Company or either Advisor,
threatened against or affecting the Company before any court or administrative
agency or otherwise (1) that is required to be disclosed in the Registration
Statement, Prospectus or the Disclosure Package and is not so described or (2)
which, if determined adversely to the Company might have a Material Adverse
Effect or prevent or materially delay the consummation of the transactions
contemplated hereby, except as set forth in the Registration Statement, the
Prospectus and the Disclosure Package.
(m) The Company owns or leases all such properties as are necessary to
the conduct of its operations as presently conducted.
(n) The Company has filed all federal, state, local and foreign tax
returns which have been required to be filed or has requested extensions thereof
(except in any case in which the failure so to file would not have a material
adverse effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company, whether or not arising
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from transactions in the ordinary course of business, except as set forth in or
contemplated in the Prospectus and the Disclosure Package (exclusive of any
supplements thereto) and has paid all taxes required to be paid by it and any
other assessment, fine or penalty levied against it, to the extent that any of
the foregoing is due and payable, except for any such assessment, fine or
penalty that is currently being contested in good faith or as is not reasonably
likely to have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business, or properties of the Company, whether
or not arising from transactions in the ordinary course of business, except as
set forth in or contemplated in the Disclosure Package or the Prospectus
(exclusive of any supplements thereto). There are no transfer taxes or other
similar fees or charges under federal law or the laws of any state, or any
political subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance by the Company or sale
by the Company of the Shares.
(o) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, as it may be amended or supplemented,
there has not been any material adverse change or any development involving a
prospective change which has had or is reasonably likely to have a Material
Adverse Effect, whether or not occurring in the ordinary course of business, and
there has not been any material transaction entered into or any material
transaction that is probable of being entered into by the Company, other than
transactions in the ordinary course of business and changes and transactions
described in the Prospectus and the Disclosure Package. The Company has no
material contingent obligations that are not disclosed in the Company's
financial statements in the Registration Statement, the Prospectus and the
Disclosure Package.
(p) The Company is not, and with the giving of notice or lapse of time
or both, will not be, in violation of or in default under its Declaration of
Trust or By-Laws or under any agreement, lease, contract, indenture or other
instrument or obligation to which it is a party or by which it, or any of its
properties, is bound and which default has had or is reasonably likely to have a
Material Adverse Effect. The execution and delivery of this Agreement and each
of the Company Agreements and the consummation of the transactions contemplated
herein and therein and the fulfillment of the terms hereof and thereof do not
and will not, whether with or without notice or the passing of time or both, (i)
conflict with or otherwise violate any of the terms or provisions of the
Declaration of Trust or By-Laws of the Company or (ii) conflict with or result
in a breach of any of the terms or provisions of, or constitute a default under,
any contract, indenture, mortgage, deed of trust or other agreement or
instrument to which the Company is a party or any order, rule or regulation
applicable to the Company of any court or of any regulatory body or
administrative agency or other governmental body having jurisdiction, which
breach or default has had or is likely to have a Material Adverse Effect.
(q) Each approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body necessary in connection with the execution and delivery by the
Company of this Agreement and the consummation of the transactions herein
contemplated (except such additional steps as may be required by the Commission,
the NASD or such additional steps as may be necessary to qualify the Shares for
public offering by the Underwriters under state securities or Blue Sky laws) has
been obtained or made and is in full force and effect.
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(r) The Company has all material licenses, certifications, permits,
franchises, approvals, clearances and other regulatory authorizations
("Permits") from governmental authorities as are necessary to conduct its
businesses as currently conducted and as currently proposed to be conducted and
to own, lease and operate its properties in the manner described in the
Prospectus and the Disclosure Package. There is no claim or proceeding pending
or, to the knowledge of the Company or either Advisor, threatened, involving the
status of or sanctions under any of the Permits. The Company has fulfilled and
performed all of its material obligations with respect to the Permits, and no
event has occurred which allows, or after notice or lapse of time would allow,
the revocation, termination, modification or other impairment of the rights of
the Company under such Permit. None of the Permits contains any restriction that
is materially burdensome on the Company.
(s) To the knowledge of the Company and each Advisor, there are no
affiliations between any member of the NASD and any of the Company's officers,
trustees or security holders, except as set forth in the Registration Statement
or as disclosed in writing to the Underwriters.
(t) Except as stated in this Agreement and the Prospectus, the Company
and the Advisors have not taken, directly or indirectly, any action that would
constitute or that might reasonably be expected to cause or result in, under the
Exchange Act or otherwise, stabilization or manipulation of the price of the
Common Shares to facilitate the sale or resale of the Shares.
(u) The Company is duly registered under the 1940 Act as a closed-end,
diversified management investment company and the 1940 Act Notification has been
duly filed with the Commission, and, at the time of filing thereof and at the
time of filing any amendment or supplement thereto, conformed in all material
respects with all applicable provisions of the 1940 Act and the Rules and
Regulations under the 0000 Xxx. The Company has not received any notice from the
Commission pursuant to Section 8(e) of the 1940 Act with respect to the 1940 Act
Notification or the Registration Statement (or any amendment or supplement to
either of them).
(v) The Company carries a fidelity bond sufficient to satisfy the
requirements of Rule 17g-1 under the 1940 Act.
(w) Other than as contemplated by this Agreement, the Company has not
incurred any liability for any finder's or broker's fee, or agent's commission
in connection with the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.
(x) The Company has not sent or received any notice indicating the
termination of or intention to terminate any of the contracts or agreements
referred to or described in the Registration Statement, the Prospectus or the
Disclosure Package, or filed as an exhibit to the Registration Statement, and no
such termination has been threatened by the Company or any other party to any
such contract or agreement. There are no contracts or documents which are
required to be described in the Registration Statement, the Prospectus or the
Disclosure Package or to be filed as exhibits thereto by the Acts or by the
Rules and Regulations which have not been so described and filed as required and
such contracts and
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documents as are summarized in the Registration Statement, the Prospectus or the
Disclosure Package are fairly summarized in all material respects.
(y) The Company owns, licenses, or otherwise has rights in all United
States and foreign patents, trademarks, service marks, tradenames, copyrights,
trade secrets and other proprietary rights necessary for the conduct of its
business as currently carried on and as proposed to be carried on as described
in the Registration Statement, the Prospectus or the Disclosure Package
(collectively and together with any applications or registrations for the
foregoing, the "Intellectual Property").
(z) The conduct of business by the Company complies, and at all times
has complied, in all respects with federal, state, local and foreign laws,
statutes, ordinances, rules, regulations, decrees, orders, Permits and other
similar items ("Laws") applicable to its business, including, without
limitation, licensing and certification Laws covering any aspect of the business
of the Company, except where such noncompliance is not reasonably likely to have
a material adverse effect on the condition (financial or otherwise), prospects,
earnings, business, or properties of the Company, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Disclosure Package or the Prospectus (exclusive of any
supplements thereto). The Company has not received any notification asserting,
nor does it have knowledge of, any present or past failure to comply with or
violation of any such Laws.
(aa) The information contained in the Registration Statement, the
Prospectus and the Disclosure Package regarding the Company's expectations,
plans and intentions were made by the Company on a reasonable basis and reflect
the Company's good faith belief and/or estimate of the matters described
therein. To the extent estimated or projected, those estimates or projections
set forth in the tables under the "Summary of Fund Expenses" section of the
Registration Statement, Prospectus and the Disclosure Package have been prepared
in accordance with the requirements of Form N-2 and when considered with the
footnotes thereto, are reasonably believed to be attainable in all material
respects and are reasonably based.
(bb) Any certificate signed by any officer of the Company and
delivered to the Representative or counsel for the Underwriters in connection
with the offering of the Shares contemplated hereby shall be deemed a
representation and warranty by the Company to each Underwriter and shall be
deemed to be a part of this Section 1 and incorporated herein by this reference.
(cc) The Company, subject to the Registration Statement having been
declared effective and the filing of the Prospectus under Rule 497, has taken
all required action under the Acts and the Rules and Regulations to make the
public offering and consummate the sale of the Shares as contemplated by this
Agreement.
(dd) All advertising, sales literature or other promotional material
(including "prospectus wrappers" and "broker kits"), whether in printed or
electronic form, authorized in writing by or prepared by the Fund or the Adviser
for use in connection with the offering and sale of the Shares (collectively,
"sales material") complied and comply in all material respects with the
applicable requirements of the Investment Advisers Act, the 1940 Act, the Rules
and
8
Regulations and the rules and interpretations of the NASD and if required to
be filed with the NASD under the NASD's conduct rules, were provided to the
Underwriters for filing. None of (1) the promotional material for use in
connection with the marketing of the Shares in oral presentations to brokers
(including any "road show slides," and "road show scripts," authorized in
writing by or prepared by the Fund or the Adviser (collectively, "broker
material")), when read together with the Prospectus, or (2) the sales material,
contained or contains 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.
(ee) This Agreement and each of the Company Agreements comply in all
material respects with all applicable provisions of the 1940 Act, the Rules and
Regulations thereunder, the Investment Advisers Act of 1940, as amended (the
"Advisers Act"), and the rules and regulations adopted by the Commission under
the Advisers Act (the "Advisers Act Rules and Regulations").
(ff) The Company intends to direct investment of the proceeds of the
offering of Shares in such a manner as to comply with the requirement of
Subchapter M of the Code. The Company intends to invest or otherwise use the net
proceeds of its sale of the Shares as described under the heading "Use of
Proceeds" in the Prospectus and the Disclosure Package in such a manner as to
comply with the investment restrictions and the 1940 Act and shall report with
the Commission with respect to the sale of the Shares and the application of the
proceeds therefrom as may be required in accordance with Rule 463 under the
Securities Act.
(gg) Except as disclosed in the Registration Statement, the Prospectus
and the Disclosure Package (or any amendment or supplement to either of them),
no trustee of the Company or either Advisor is an "interested person" (as
defined in the 0000 Xxx) of the Company or either Advisor or an "affiliated
person" (as defined in the 0000 Xxx) of any Underwriter.
Any certificate signed by any officer of the Company and delivered to the
Representative or counsel for the Underwriters in connection with the offering
of the Shares contemplated hereby, shall be deemed a representation and warranty
by the Company, as to matters covered therein, to each Underwriter.
2. REPRESENTATIONS AND WARRANTIES OF THE INVESTMENT ADVISOR.
The Investment Advisor represents and warrants to each of the Underwriters
as of the date hereof, as of the Closing Date and each Option Closing Date, if
any, as follows:
(a) The Investment Advisor has been duly organized and is validly
existing as a corporation under the laws of the Commonwealth of Massachusetts,
with corporate power and authority to own or lease its properties and conduct
its business as described in the Prospectus and the Disclosure Package. The
Investment Advisor is duly qualified to transact business and is in good
standing in all jurisdictions in which the conduct of its business requires such
qualification; except where the failure to be so qualified or to be in good
standing would not have a Material Adverse Effect.
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(b) Each Advisor Agreement has been duly authorized, executed and
delivered by the Investment Advisor, and, assuming due authorization, execution
and delivery by the other parties thereto, constitutes a valid, legal, and
binding obligation of the Investment Advisor, enforceable in accordance with its
terms, except as rights to indemnity hereunder may be limited by federal or
state securities laws. The Investment Advisor has full power and authority to
enter into each Advisor Agreement.
(c) There is no action, suit, claim or proceeding pending or, to the
knowledge of the Investment Advisor, threatened against the Investment Advisor
before any court or administrative agency or otherwise (1) that is required to
be described in the Registration Statement, the Prospectus or the Disclosure
Package that are not so described, or (2) which, if determined adversely to the
Investment Advisor would have a Material Adverse Effect or prevent the
consummation of the transactions contemplated hereby, except as set forth in the
Registration Statement, the Prospectus and the Disclosure Package.
(d) Except as stated in this Agreement and the Prospectus, the
Investment Advisor has not taken, directly or indirectly, any action designed to
or that would constitute or that might reasonably be expected to cause or result
in, under the Exchange Act or otherwise, stabilization or manipulation of the
price of the Common Shares to facilitate the sale or resale of the Shares.
(e) The Investment Advisor carries, or is covered by, insurance,
including, at a minimum, errors and omissions insurance, in such amounts and
covering such risks as is adequate for the conduct of its businesses and the
value of its properties and as is customary for companies engaged in similar
industries. All policies of insurance insuring the Investment Advisor or its
respective businesses, assets, employees, partners, officers and directors are
in full force and effect, and the Investment Advisor is in compliance with the
terms of such policies in all material respects. There are no claims by the
Investment Advisor under any such policy or instrument as to which an insurance
company is denying liability or defending under a reservation of rights clause.
(f) Other than as contemplated by this Agreement, the Investment
Advisor has not incurred any liability for any finder's or broker's fee, or
agent's commission, in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby.
(g) The Investment Advisor is not, and with the giving of notice or
lapse of time or both, will not be, in violation of or in default under its
Articles of Organization (the "Charter") or By-Laws or under any agreement,
lease, contract, indenture or other instrument or obligation to which it is a
party or by which it, or any of its properties, is bound and which default has
had or is reasonably likely to have a Material Adverse Effect. The execution and
delivery of each Advisor Agreement and the consummation of the transactions
herein and therein contemplated and the fulfillment of the terms hereof will not
(i) conflict with or otherwise violate the terms and provisions of the Charter
or By-Laws of the Investment Advisor or (ii) conflict with or result in a breach
of any of the terms or provisions of, or constitute a default under, any
contract, indenture, mortgage, deed of trust or other agreement or instrument to
which the Investment Advisor is a party or any order, rule or regulation
applicable to the Investment
10
Advisor of any court or of any regulatory body or administrative agency or other
governmental body having jurisdiction, which breach or default has had or is
reasonably likely to have a Material Adverse Effect.
(h) The Investment Advisor is duly registered as an investment adviser
under the Advisers Act and is not prohibited by the Advisers Act, the 1940 Act,
the Advisers Act Rules and Regulations or the Rules and Regulations under the
1940 Act from acting under the Advisor Agreements as contemplated by the
Registration Statement, the Prospectus and the Disclosure Package.
(i) The Investment Advisor has the financial resources available to it
necessary for the performance of its services and obligations as contemplated in
the Registration Statement, the Prospectus and the Disclosure Package and under
this Agreement and the Advisor Agreements.
(j) The description of the Investment Advisor, its business, and the
statements attributable to the Investment Advisor, in the Registration
Statement, the Prospectus and the Disclosure Package or any Preliminary
Prospectus complied and comply in all material respects with the provisions of
the Acts, the Advisers Act, the Rules and Regulations and the Advisers Act Rules
and Regulations and did not and will not contain an untrue statement of a
material fact necessary to make the statements therein (in the case of a
prospectus, in light of the circumstances under which they were made) not
misleading.
(k) Each Advisor Agreement complies in all material respects with all
applicable provisions of the 1940 Act, the Rules and Regulations under the 1940
Act, the Advisers Act and the Advisers Act Rules and Regulations.
3. PURCHASE, SALE AND DELIVERY OF THE FIRM SHARES.
(a) On the basis of the representations, warranties and covenants
herein contained, and subject to the conditions herein set forth, the Company
agrees to sell to the Underwriters and each Underwriter agrees, severally and
not jointly, to purchase, at a price of $19.10 per share, the number of Firm
Shares set forth opposite the name of each Underwriter in Schedule I hereof,
subject to adjustments in accordance with Section 10 hereof.
(b) Payment for the Firm Shares to be sold hereunder is to be made in
New York Clearing House funds by federal (same day) funds against delivery of
the Firm Shares to the Representative for the several accounts of the
Underwriters. Such payment and delivery are to be made through Full Fast
Delivery through the facilities of the Depository Trust Company, New York, New
York at 9:00 a.m., New York time, on the third business day after the date of
this Agreement or at such other time and date not later than five business days
thereafter as you and the Company shall agree upon, such time and date being
herein referred to as the "Closing Date." As used herein, "business day" means a
day on which the American Stock Exchange is open for trading and on which banks
in New York are open for business and are not permitted by law or executive
order to be closed. The Firm Shares will be delivered in such denominations and
in such registrations as the Representative requests in writing not later than
the second full business day prior to the Closing Date.
11
(c) In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company hereby grants an option to the several Underwriters to purchase the
Option Shares at the price per share as set forth in the first paragraph of this
Section. The option granted hereby may be exercised not more than twice in whole
or in part by giving written notice (i) at any time before the Closing Date and
(ii) only once thereafter within 45 days after the date of this Agreement, by
RBC Capital Markets Corporation, on behalf of the several Underwriters, to the
Company setting forth the number of Option Shares as to which the several
Underwriters are exercising the option, the names and denominations in which the
Option Shares are to be registered and the time and date at which such
certificates are to be delivered. The time and date at which the Option Shares
are to be delivered shall be determined by RBC Capital Markets Corporation but
shall not be earlier than three nor later than 10 full business days after the
exercise of such option, nor in any event prior to the Closing Date (such time
and date being herein referred to as the "Option Closing Date"). If the date of
exercise of the option is three or more days before the Closing Date, the notice
of exercise shall set the Closing Date as the Option Closing Date. The number of
Option Shares to be purchased by each Underwriter shall be in the same
proportion to the total number of Option Shares being purchased as the number of
Firm Shares being purchased by such Underwriter bears to the total number of
Firm Shares, adjusted by you in such manner as to avoid fractional shares. The
option with respect to the Option Shares granted hereunder may be exercised only
to cover over-allotments in the sale of the Firm Shares by the Underwriters. RBC
Capital Markets Corporation, on behalf of the several Underwriters, may cancel
such option at any time prior to its expiration by giving written notice of such
cancellation to the Company. To the extent, if any, that the option is
exercised, payment for the Option Shares shall be made on the Option Closing
Date in federal (same day) funds through the facilities of the Depository Trust
Company in New York, New York drawn to the order of the Company.
4. OFFERING BY THE UNDERWRITERS.
It is understood that the several Underwriters are to make a public
offering of the Firm Shares as soon as the Representative deems it advisable to
do so. The Firm Shares are to be initially offered to the public at the initial
public offering price set forth in the Prospectus. The Representative may from
time to time thereafter change the public offering price and other selling
terms. To the extent, if at all, that any Option Shares are purchased pursuant
to Section 3 hereof, the Underwriters will offer them to the public on the
foregoing terms.
It is further understood that you will act as the Representative for the
Underwriters in the offering and sale of the Shares in accordance with a Master
Agreement Among Underwriters entered into by you and the several other
Underwriters.
5. COVENANTS OF THE COMPANY.
(a) The Company covenants and agrees with the several Underwriters,
that:
(i) The Company will (A) use its reasonable best efforts to cause
the Registration Statement to become effective or, if the procedure in Rule 430A
of the Rules and Regulations under the Securities Act is followed, to prepare
and timely file with the Commission under Rule 497 of the Rules and Regulations
under the Securities Act a Prospectus in a form
12
approved by the Representative containing information previously omitted at the
time of effectiveness of the Registration Statement in reliance on Rule 430A of
the Rules and Regulations under the Securities Act; (B) not file any amendment
to the Registration Statement or supplement to the Prospectus of which the
Representative shall not previously have been advised and furnished with a copy
or to which the Representative shall have reasonably objected in writing or
which is not in compliance with the Rules and Regulations; and (C) file on a
timely basis all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission subsequent to the date
of the Prospectus and prior to the termination of the offering of the Shares by
the Underwriters.
(ii) The Company will not take, directly or indirectly, any
action designed to cause or result in, or that has constituted or might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any securities of the Company.
(iii) The Company will advise the Representative promptly (A)
when the Registration Statement or any post-effective amendment thereto shall
have become effective; (B) of receipt of any comments from the Commission; (C)
of any request of the Commission for amendment of the Registration Statement or
for supplementation of the Prospectus or for any additional information; and (D)
of the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the use of the Prospectus or of the institution
of any proceedings for that purpose. The Company will use its reasonable best
efforts to prevent the issuance of any such stop order preventing or suspending
the use of the Prospectus and to obtain as soon as possible the lifting thereof,
if issued.
(iv) The Company will cooperate with the Representative in
endeavoring to qualify the Shares for sale under the securities laws of such
jurisdictions as the Representative may reasonably have designated in writing
and will make such applications, file such documents, and furnish such
information as may be reasonably required for that purpose, provided the Company
shall not be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction where it is not now so
qualified or required to file such a consent. The Company will, from time to
time, prepare and file such statements, reports, and other documents, as are or
may be required to continue such qualifications in effect for so long a period
as the Representative may reasonably request for distribution of the Shares.
(v) The Company will deliver to, or upon the order of, the
Representative, from time to time, as many copies of any Preliminary Prospectus
as the Representative may reasonably request. The Company will deliver to, or
upon the order of, the Representative during the period when delivery of a
Prospectus is required under the Acts, as many copies of the Prospectus in final
form, or as thereafter amended or supplemented, as the Representative may
reasonably request. The Company will deliver to the Representative such number
of copies of the Registration Statement (including such number of copies of the
exhibits filed therewith that may reasonably be requested) and of all amendments
thereto, as the Representative may reasonably request.
(vi) The Company will comply with the Acts and the Rules and
Regulations, and the Exchange Act, and the rules and regulations of the
Commission thereunder,
13
so as to permit the completion of the distribution of the Shares as contemplated
in this Agreement and the Prospectus. If during the period in which a prospectus
is required by law to be delivered by an Underwriter or dealer, any event shall
occur as a result of which, in the judgment of the Company or in the reasonable
opinion of the Underwriters, it becomes necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the
circumstances existing at the time the Prospectus is delivered to a purchaser,
not misleading, or if it is necessary at any time to amend or supplement the
Prospectus to comply with any law, the Company promptly will prepare and file
with the Commission an appropriate amendment to the Registration Statement or
supplement to the Prospectus so that the Prospectus as so amended or
supplemented will not, in the light of the circumstances when it is so
delivered, be misleading, or so that the Prospectus will comply with the law;
provided, however, that if such amendment or supplement is required solely as a
result of a material misstatement in or material omission from the information
furnished in writing by or on behalf of an Underwriter to the Company, the
Advisor or the Sub-Advisor expressly for use in the Registration Statement or
the Prospectus (information such as described in Section 14 of this Agreement),
then the Company shall deliver such amendment or supplement at cost to such
Underwriter.
(vii) The Company will make generally available to its security
holders, as soon as it is practicable to do so, but in any event not later than
15 months after the effective date of the Registration Statement, an earning
statement (which need not be audited) in reasonable detail, covering a period of
at least 12 consecutive months beginning after the effective date of the
Registration Statement, which earning statement shall satisfy the requirements
of Section 11(a) of the Securities Act and Rule 158 of the Rules and Regulations
thereunder and will advise you in writing when such statement has been so made
available.
(viii) No offering, sale, short sale or other disposition of any
Common Shares or other securities convertible into or exchangeable or
exercisable for Common Shares or derivative of Common Shares (or agreement for
such) will be made for a period of 180 days after the date of this Agreement,
directly or indirectly, by the Company otherwise than hereunder or with the
prior written consent of RBC Capital Markets Corporation.
(ix) The Company will use its reasonable best efforts to list,
subject to notice of issuance, the Shares on the American Stock Exchange.
(x) The Company will distribute timely all of its investment
company taxable income and net capital gain so as to avoid any corporate income
tax, and will take all actions and omit to take all actions as are necessary to
qualify as a regulated investment company under Subchapter M of the Code for the
current and all future taxable years and to be consistent otherwise with the
foregoing.
(xi) The Company will maintain a transfer agent and, if necessary
under the jurisdiction of organization of the Company, a registrar for the
Common Shares.
6. COSTS AND EXPENSES.
The Company will pay all costs, expenses and fees incident to the
performance of the obligations of the Company under this Agreement, including,
without limiting the generality of
14
the foregoing, the following: accounting fees of the Company; the fees and
disbursements of counsel for the Company; the cost of printing and delivering
to, or as requested by, the Underwriters copies of the Registration Statement,
Preliminary Prospectuses, the Prospectus, the Underwriters' Selling Memorandum
and the Underwriters' Invitation Letter, if any; the listing application of the
American Stock Exchange; the filing fees of the Commission; the filing fees
incident to securing any required review by the NASD of the terms of the sale of
the Shares; and the listing fee of the American Stock Exchange. Also, the
Company will pay the Underwriters $[____] per Share purchased by the
Underwriters pursuant to this Agreement, as partial reimbursement of expenses in
connection with the Offering; provided, however, that such partial reimbursement
payable by the Company shall not exceed [____]% of the aggregate offering price
to the public (as set forth in the Pricing Prospectus) of the Firm Shares that
may be sold to the Underwriters pursuant to this Agreement. The Investment
Advisor has agreed to pay (i) all organizational expenses of the Company and
(ii) offering costs (other than sales load, but including the partial
reimbursement of expenses described above) of the Company that exceed $.04 per
Firm Share. The Sub-Advisor has agreed to reimburse the Investment Advisor for
one-half of such organizational expenses and offering costs of the Company that
exceed $.04 per Firm Share.
The Company shall not, however, be required to pay for any of the
Underwriters' expenses if the Shares are not purchased by the Underwriters
except that if this Agreement shall not be consummated because the conditions in
Section 7 hereof are not satisfied, or because this Agreement is terminated by
the Representative pursuant to Section 12 hereof, or by reason of any failure,
refusal or inability on the part of the Company to perform any undertaking or
satisfy any condition of this Agreement or to comply with any of the terms
hereof on its part to be performed, unless such failure to satisfy said
condition or to comply with said terms be due to the default or omission of any
Underwriter, then the Company shall reimburse the several Underwriters for
reasonable out-of-pocket expenses actually incurred, including all fees and
disbursements of counsel, reasonably incurred in connection with investigating,
marketing and proposing to market the Shares or in contemplation of performing
their obligations hereunder; but the Company shall not in any event be liable to
any of the several Underwriters for damages on account of loss of anticipated
profits from the sale by them of the Shares.
7. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS.
The several obligations of the Underwriters to purchase the Firm Shares on
the Closing Date and the Option Shares, if any, on the Option Closing Date are
subject to the accuracy, as of the Closing Date and the Option Closing Date, if
any, of the representations and warranties of the Company and the Advisors
contained herein, and to the performance by the Company and the Advisors of
their covenants and obligations hereunder and to the following additional
conditions:
(a) The Registration Statement and all post-effective amendments
thereto shall have become effective and any and all filings required by Rule 497
and Rule 430A of the Rules and Regulations shall have been made, and any request
of the Commission for additional information (to be included in the Registration
Statement or otherwise) shall have been disclosed to the Representative and
complied with. No stop order suspending the effectiveness of the Registration
Statement, as amended from time to time, shall have been issued and no
proceedings for that purpose shall have been taken or, to the knowledge of the
Company, shall be
15
contemplated by the Commission, no stop order suspending or preventing the use
of the Pricing Prospectus shall have been initiated, or to the knowledge of the
Company, shall be contemplated by the Commission; all requests for additional
information on the part of the Commission shall have been complied with; and no
injunction, restraining order, or order of any nature by a federal or state
court of competent jurisdiction shall have been issued as of the Closing Date
which would prevent the issuance of the Shares.
(b) The Representative shall have received on the Closing Date and the
Option Closing Date, if any, the opinion of Skadden, Arps, Slate, Xxxxxxx & Xxxx
LLP, counsel for the Company, dated the Closing Date or the Option Closing Date,
if any, addressed to the Underwriters:
[SEE FORM]
(c) The Representative shall have received on the Closing Date and the
Option Closing Date, if any, the opinion of Skadden, Arps, Slate, Xxxxxxx & Xxxx
LLP, counsel for the Investment Advisor, dated the Closing Date or the Option
Closing Date, if any, addressed to the Underwriters to the effect that:
(i) The Investment Advisor has been duly organized and is validly
existing as a corporation in good standing under the laws of the Commonwealth of
Massachusetts with corporate power and authority to own or lease its properties
and conduct its business as described in the Registration Statement.
(ii) The Investment Advisor is duly registered as an investment
adviser under the Advisers Act and is not prohibited by the Advisers Act, the
1940 Act, the Advisers Act Rules and Regulations or the Rules and Regulations
under the 1940 Act from acting under the Company Agreements (to which the
Investment Advisor is a party) as contemplated by the Registration Statement and
the Prospectus (or any amendment or supplement thereto).
(iii) The execution and delivery of each Advisor Agreement and
the consummation of the transactions contemplated therein do not and will not
conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under, the Charter or By-Laws of the Investment Advisor, or
any agreement or instrument identified to such counsel by the Investment Advisor
as material to its business or operations.
(iv) Each Advisor Agreement has been duly authorized, executed
and delivered by the Investment Advisor and complies in all material respects
with all applicable provisions of the 1940 Act, the Advisers Act, the Rules and
Regulations under the 1940 Act and the Advisers Act Rules and Regulations, and
each Advisor Agreement (other than this Agreement) constitutes a valid and
binding obligation of the Investment Advisor, enforceable in accordance with its
terms, except as rights to indemnity and contribution may be limited by federal
or state securities laws and except as affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally.
16
(d) The Representative shall have received on the Closing Date and the
Option Closing Date, if any, the opinion of Xxxxx & XxXxxxxx, counsel for the
Sub-Advisor, dated the Closing Date or the Option Closing Date, if any,
addressed to the Underwriters to the effect that:
(i) The Sub-Advisor has been duly organized and is validly
existing as a corporation under the laws of Australia with corporate power and
authority to own or lease its properties and conduct its business as described
in the Registration Statement.
(ii) The Sub-Advisor is duly registered as an investment adviser
under the Advisers Act and is not prohibited by the Advisers Act, the 1940 Act,
the Advisers Act Rules and Regulations or the Rules and Regulations under the
1940 Act from acting under the Company Agreements (to which the Advisor is a
party) as contemplated by the Registration Statement and the Prospectus (or any
amendment or supplement thereto).
(iii) The execution and delivery of each Advisor Agreement to
which the Sub-Advisor is a party and the consummation of the transactions
contemplated therein do not and will not conflict with or result in a breach of
any of the terms or provisions of, or constitute a default under, the [ARTICLES
OF ORGANIZATION OR BY-LAWS] of the Sub-Advisor.
(iv) The Sub-advisory Agreement and the Deed Poll (as defined in
Section 7(i)(i) have each been duly authorized, executed and delivered by the
Sub-Advisor and the Sub-Advisory Agreement complies in all material respects
with all applicable provisions of the 1940 Act, the Advisers Act, the Rules and
Regulations under the 1940 Act and the Advisers Act Rules and Regulations, and
the Sub-advisory Agreement and the Deed Poll each constitutes a valid and
binding obligation of the Sub-Advisor, enforceable in accordance with its terms,
except as rights to indemnity and contribution may be limited by federal or
state securities laws and except as affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally.
(v) The description of the Sub-Advisor and its business, and the
statements attributable to the Sub-Advisor, in the Registration Statement, the
Prospectus and the Disclosure Package (and any amendment or supplement thereto)
complied and comply in all material respects with the provisions of the Acts,
the Advisers Act, the Rules and Regulations and the Advisers Act Rules and
Regulations.
[SEE FORM FOR NEGATIVE ASSURANCE LANGUAGE FOR COMPANY AND ADVISOR]
(e) The Representative shall have received from Xxxxxxx Procter LLP,
counsel for the Underwriters, an opinion dated the Closing Date and the Option
Closing Date, if any, with respect to matters as the Representative reasonably
may request, and such counsel shall have received such papers and information as
it requests to enable it to pass upon such matters.
(f) You shall have received, on each of the dates hereof, the Closing
Date and the Option Closing Date, if any, a letter dated the date hereof, the
Closing Date or the Option Closing Date, if any, in form and substance
satisfactory to you, of Ernst & Young, LLP confirming that it is an independent
registered public accounting firm within the meaning of the
17
Acts and the applicable published Rules and Regulations thereunder and stating
that in its opinion the financial statements and schedules examined by it and
included or incorporated by reference in the Registration Statement comply in
form in all material respects with the applicable accounting requirements of the
Acts and the related published Rules and Regulations; and containing such other
statements and information as is ordinarily included in accountants' "comfort
letters" to Underwriters with respect to the financial statements and certain
financial and statistical information contained or incorporated by reference in
the Registration Statement and the Prospectus.
(g) The Representative shall have received on the Closing Date and the
Option Closing Date, if any, a certificate or certificates of the Company's
President and Treasurer to the effect that, as of the Closing Date or the Option
Closing Date, if any, each of them severally represents they have carefully
reviewed the Registration Statement and Prospectus and to their knowledge as
follows:
(i) The Registration Statement has become effective under the
Securities Act and 1940 Act and no stop order suspending the effectiveness of
the Registration Statement has been issued, and no proceedings for such purpose
have been taken or are, to their knowledge, contemplated by the Commission;
(ii) The representations and warranties of the Company contained
in Section 1 hereof are true and correct as of the Closing Date or the Option
Closing Date, if any;
(iii) All filings required to have been made pursuant to Rules
497 or 430A under the Securities Act have been made; and
(iv) Since the respective dates as of which information is given
in the Disclosure Package, there has not been any material adverse change or any
development involving a prospective change, which has had or is reasonably
likely to have a Material Adverse Effect, whether or not arising in the ordinary
course of business.
(h) The Representative shall have received on the Closing Date and the
Option Closing Date, if any, a certificate or certificates of the Investment
Advisor's President and Treasurer to the effect that, as of the Closing Date or
the Option Closing Date, the Investment Advisor represents as follows:
(i) The representations and warranties of the Sub-Advisor
contained in Section 3 hereof are true and correct as of the Closing Date or the
Option Closing Date, if any; and
(ii) Since the respective dates as of which information is given
in the Disclosure Package, there has not been any material adverse change or any
development involving a prospective change, which has had or is reasonably
likely to have a Material Adverse Effect, whether or not arising in the ordinary
course of business.
(i) The Representative shall have received on the Closing Date and the
Option Closing Date, if any, a certificate or certificates of the Sub-Advisor's
[PRESIDENT AND
18
TREASURER] to the effect that, as of the Closing Date or the Option Closing
Date, if any, the Sub-Advisor represents as follows:
(i) The representations and warranties of the Sub-Advisor
contained in the Deed Poll between RBC Capital Markets Corporation as the
Representative of the several underwriters and MacarthurCook Investment Managers
Ltd. Dated as of the date hereof (the "Deed Poll") are true and correct as of
the Closing Date or the Option Closing Date, if any and
(ii) Since the respective dates as of which information is given
in the Disclosure Package, there has not been any material adverse change or any
development involving a prospective change, which has had or is reasonably
likely to have a Material Adverse Effect, whether or not arising in the ordinary
course of business.
(j) The Company shall have furnished to the Representative such
further certificates and documents confirming the representations and
warranties, covenants and conditions contained herein and related matters as the
Representative may reasonably have requested.
(k) The Firm Shares and Option Shares, if any, have been approved for
designation upon notice of issuance on the American Stock Exchange.
The opinions and certificates mentioned in this Agreement shall be deemed
to be in compliance with the provisions hereof only if they are in all material
respects satisfactory to the Representative and to Xxxxxxx Procter LLP, counsel
for the Underwriters.
If any of the conditions hereinabove provided for in this Section shall not
have been fulfilled when and as required by this Agreement to be fulfilled, the
obligations of the Underwriters hereunder may be terminated by the
Representative by notifying the Company of such termination in writing on or
prior to the Closing Date or the Option Closing Date, if any.
In such event, the Company and the Underwriters shall not be under any
obligation to each other (except to the extent provided in Sections 6, 9 and 16
hereof).
8. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY.
The obligations of the Company to sell and deliver the portion of the
Shares required to be delivered as and when specified in this Agreement are
subject to the conditions that at the Closing Date or the Option Closing Date,
if any, no stop order suspending the effectiveness of the Registration Statement
shall have been issued and in effect or proceedings therefor initiated or
threatened.
9. INDEMNIFICATION.
(a) The Company and the Investment Advisor, jointly and severally,
agree:
(i) to indemnify and hold harmless each Underwriter, its
partners, members, directors and officers and each person, if any, who controls
such Underwriter within the meaning of the Securities Act or the Exchange Act,
against any losses, claims, damages or
19
liabilities to which such Underwriter or any such controlling person may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of or are based upon (A) any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, any Preliminary
Prospectus, the Pricing Prospectus, the Prospectus, the Marketing Material or
any amendment or supplement thereto; provided, however, that the foregoing
indemnification contained in this Clause (a) with respect to any Preliminary
Prospectus shall not inure to the benefit of any Underwriter (or to the benefit
of any person controlling such Underwriter) on account of any such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
arising from the sale of the Shares by such Underwriter to any person if it is
determined in a final judgment by a court of competent jurisdiction that such
loss, claim, damage or liability resulted directly from the failure of such
Underwriter to deliver or send to such person a copy of the Prospectus (which
term as used in this proviso shall not include any statement of additional
information unless specifically requested by such person) within the time
required by the Securities Act and the Securities Act Rules and Regulations, and
the untrue statement or alleged untrue statement or omission or alleged omission
of a material fact contained in such Preliminary Prospectus was corrected in the
Prospectus, provided that the Company has delivered the Prospectus to the
several Underwriters in requisite quantity on a timely basis to permit proper
delivery or sending, (B) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, or (C) any alleged act or failure to act by any Underwriter in
connection with, or relating in any manner to, the Shares or the offering
contemplated hereby, and which is included as part of or referred to in any
loss, claim, damage, liability or action arising out of or based upon matters
covered by clause (A) or (B) above (provided, however, that neither the Company
nor either Advisor shall be liable under this clause (C) to the extent that it
is determined in a final judgment by a court of competent jurisdiction that such
loss, claim, damage, liability or action resulted directly from any such acts or
failures to act undertaken or omitted to be taken by such Underwriter through
its gross negligence or willful misconduct); provided, however, that neither the
Company nor the Advisors will be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement, or omission or alleged omission made in
the Registration Statement, any Preliminary Prospectus, the Pricing Prospectus,
the Prospectus, the Marketing Material or such amendment or supplement, in
reliance upon and in conformity with written information furnished to the
Company or an Advisor by or through the Representative specifically for use in
the preparation thereof; and
(ii) to reimburse each Underwriter and each such controlling
person upon demand for any legal or other out-of-pocket expenses reasonably
incurred by such Underwriter or such controlling person in connection with
investigating or defending any such loss, claim, damage or liability, action or
proceeding or in responding to a subpoena or governmental inquiry related to the
offering of the Shares, whether or not such Underwriter or controlling person is
a party to any action or proceeding. In the event that it is finally judicially
determined that the Underwriters were not entitled to receive payments for legal
and other expenses pursuant to this subparagraph, the Underwriters will promptly
return all sums that had been advanced pursuant hereto.
20
(b) The Investment Advisor hereby agrees to indemnify and hold
harmless each Underwriter, its partners, members, directors and officers and
each person, if any, who controls such Underwriter within the meaning of the
Securities Act or the Exchange Act, against any losses, claims, damages or
liabilities to which such Underwriter or any such controlling person may become
subject insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of or are based upon any breach of any
representation or warranty contained in the Deed Poll.
(c) Each Underwriter severally and not jointly will indemnify and hold
harmless the Company and the Investment Advisor, each of their respective
trustees, each of their officers who have signed the Registration Statement, and
each person, if any, who controls the Company within the meaning of the
Securities Act, against any losses, claims, damages or liabilities to which the
Company or the Investment Advisor or any such trustee, officer, or controlling
person may become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of any material fact contained in the Registration Statement,
any Preliminary Prospectus, the Pricing Prospectus, the Prospectus, the
Marketing Material or any amendment or supplement thereto, or (ii) the omission
or the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading in the light
of the circumstances under which they were made; and will reimburse any legal or
other expenses reasonably incurred by the Company or any such trustee, officer,
or controlling person in connection with investigating or defending any such
loss, claim, damage, liability, action or proceeding; provided, however, that
each Underwriter will be liable in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission has been made in the Registration Statement, any Preliminary
Prospectus, the Pricing Prospectus, the Prospectus, the Marketing Material or
such amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by or through the Representative
specifically for use in the preparation thereof.
(d) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to this Section, such person (the "indemnified party") shall
promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing. No indemnification provided for in Section
10(a) or (b) shall be available to any party who shall fail to give notice as
provided in this Subsection if the party to whom notice was not given was
unaware of the proceeding to which such notice would have related and was
materially prejudiced by the failure to give such notice, but the failure to
give such notice shall not relieve the indemnifying party or parties from any
liability which it or they may have to the indemnified party for contribution or
otherwise than on account of the provisions of Section 10(a) or (b). In case any
such proceeding shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party and
shall pay as incurred the fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the right
to retain its own counsel at its own expense.
21
Notwithstanding the foregoing, the indemnifying party shall pay as incurred (or
within 30 days of presentation) the fees and expenses of the counsel retained by
the indemnified party in the event (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such counsel,
(ii) the named parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them or (iii) the indemnifying party shall
have failed to assume the defense and employ counsel reasonably acceptable to
the indemnified party within a reasonable period of time after notice of
commencement of the action.
It is understood that the indemnifying party shall not, in connection with
any proceeding or related proceedings in the same jurisdiction, be liable for
the reasonable fees and expenses of more than one separate firm for all such
indemnified parties. Such firm shall be designated in writing by you in the case
of parties indemnified pursuant to Section 10(a) and by the Company in the case
of parties indemnified pursuant to Section 10(b). The indemnifying party shall
not be liable for any settlement of any proceeding effected without its written
consent but if settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified party from
and against any loss or liability by reason of such settlement or judgment. In
addition, the indemnifying party will not, without the prior written consent of
the indemnified party, settle or compromise or consent to the entry of any
judgment in any pending or threatened claim, action or proceeding of which
indemnification may be sought hereunder (whether or not any indemnified party is
an actual or potential party to such claim, action or proceeding) unless such
settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising out of such claim, action or
proceeding.
(e) If the indemnification provided for in this Section is unavailable
to or insufficient to hold harmless an indemnified party under Section 10(a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) referred to therein, then each indemnifying
party shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) in such proportion as is appropriate to reflect
the relative benefits received by the Company and the Investment Advisor
(treated as one person for this purpose) on the one hand and the Underwriters on
the other from the offering of the Shares. If, however, the allocation provided
by the immediately preceding sentence is not permitted by applicable law then
each indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company or the Investment
Advisor on the one hand and the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities, (or actions or proceedings in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company and the Investment Advisor (treated as one person for this purpose) on
the one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the table
on the cover page of the Prospectus. The relative fault shall be determined by
22
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Investment Advisor on the
one hand or the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company, the Advisors and the Underwriters agree that it would not be
just and equitable if contributions pursuant to this Subsection 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 which does not take account
of the equitable considerations referred to above in this Subsection. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) referred
to above in this Subsection shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Subsection, (i) no Underwriter shall be required to
contribute any amount in excess of the underwriting discounts and commissions
applicable to the Shares purchased by such Underwriter and (ii) no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this Subsection to contribute are several in proportion to their respective
underwriting obligations and not joint.
(f) In any proceeding relating to the Registration Statement, any
Preliminary Prospectus, the Pricing Prospectus, the Prospectus or any supplement
or amendment thereto, each party against whom contribution may be sought under
this Section hereby consents to the jurisdiction of any court having
jurisdiction over any other contributing party, agrees that process issuing from
such court may be served upon him or it by any other contributing party and
consents to the service of such process and agrees that any other contributing
party may join him or it as an additional defendant in any such proceeding in
which such other contributing party is a party.
(g) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section shall be paid by the indemnifying party to the indemnified party as such
losses, claims, damages, liabilities or expenses are incurred. The indemnity and
contribution agreements contained in this Section and the representations and
warranties of the Company and the Advisors set forth in this Agreement shall
remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter, the Company, its trustees or officers or any persons
controlling the Company, or the Advisors, or their respective directors or
officers or any persons controlling either Advisor, (ii) acceptance of any
Shares and payment therefor hereunder, and (iii) any termination of this
Agreement. A successor to any Underwriter, or to the Company or either Advisor,
their respective directors or officers, or any person controlling the Company or
either Advisor, shall be entitled to the benefits of the indemnity, contribution
and reimbursement agreements contained in this Section.
(h) [In addition to the foregoing indemnification, the Company and the
Investment Advisor, jointly and severally, agree to indemnify and hold harmless
each
23
Underwriter and each person, if any, who controls any Underwriter within the
meaning of the Securities Act, against any losses, claims, damages or
liabilities described in the indemnity contained in Section 10(a), as limited by
the proviso set forth therein, with respect to any advertisement or sales
material authorized by the Company for use in the public offering of the Shares
pursuant to Rule 482 of the Rules and Regulations under the Securities Act]. The
indemnification provisions in this Section 10 that are applicable to the Company
are subject to any applicable limitations and provisions of Section 17(i) of the
1940 Act.
10. DEFAULT BY UNDERWRITERS.
If on the Closing Date or the Option Closing Date, if any, any Underwriter
shall fail to purchase and pay for the portion of the Shares which such
Underwriter has agreed to purchase and pay for on such date (otherwise than by
reason of any default on the part of the Company), you, as the Representative of
the Underwriters, shall use your reasonable efforts to procure within 36 hours
thereafter one or more of the other Underwriters, or any others, to purchase
from the Company such amounts as may be agreed upon and upon the terms set forth
herein, the Firm Shares or Option Shares, as the case may be, which the
defaulting Underwriter or Underwriters failed to purchase. If during such 36
hours you, as such Representative, shall not have procured such other
Underwriters, or any others, to purchase the Firm Shares or Option Shares, as
the case may be, agreed to be purchased by the defaulting Underwriter or
Underwriters, then (a) if the aggregate number of shares with respect to which
such default shall occur does not exceed 10% of the Firm Shares or Option
Shares, as the case may be, covered hereby, the other Underwriters shall be
obligated, severally, in proportion to the respective numbers of Firm Shares or
Option Shares, as the case may be, which they are obligated to purchase
hereunder, to purchase the Firm Shares or Option Shares, as the case may be,
which such defaulting Underwriter or Underwriters failed to purchase, or (b) if
the aggregate number of shares of Firm Shares or Option Shares, as the case may
be, with respect to which such default shall occur exceeds 10% of the Firm
Shares or Option Shares, as the case may be, covered hereby, the Company or you
as the Representative of the Underwriters, will have the right, by written
notice given within the next 36-hour period to the parties to this Agreement, to
terminate this Agreement without liability on the part of the non-defaulting
Underwriters or of the Company except to the extent provided in Section 9
hereof. In the event of a default by any Underwriter or Underwriters, as set
forth in this Section, the Closing Date or Option Closing Date, if any, may be
postponed for such period, not exceeding seven days, as you, as Representative,
may determine in order that the required changes in the Registration Statement
or in the Prospectus or in any other documents or arrangements may be effected.
The term "Underwriter" includes any person substituted for a defaulting
Underwriter. Any action taken under this Section shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
11. NOTICES.
All communications hereunder shall be in writing and, except as otherwise
provided herein, will be mailed, delivered, or faxed and confirmed as follows:
24
if to the Underwriters, to RBC Capital Markets Corporation
Xxx Xxxxxxx Xxxxx
000 Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxx
Syndicate Director
Fax: (000) 000-0000
if to the Company, to RMR Asia Pacific Real Estate Fund
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx X. X'Xxxxx
President
Fax: (000) 000-0000
if to the Advisor, to RMR Advisors, Inc.
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx X. X'Xxxxx
President
Fax: (000) 000-0000
if to the Sub-Advisor, to MacarthurCook Investment Managers
Limited
Xxxxx 0
00 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx
Xxxxxxxxx
Attention: President
12. TERMINATION.
(a) This Agreement may be terminated by you by notice to the Company
at any time prior to the Closing Date if any of the following has occurred: (i)
since the respective dates as of which information is given in the Registration
Statement and the Prospectus, any material adverse change or any development
involving a prospective change, which has had or is reasonably likely to have a
Material Adverse Effect; (ii) any outbreak or escalation of hostilities or
declaration of war or national emergency or other national or international
calamity or crisis or change in economic or political conditions if the effect
of such outbreak, escalation, declaration, emergency, calamity, crisis or change
in the financial markets of the United States would, in your reasonable
judgment, make it impracticable or inadvisable to market the Shares or to
enforce contracts for the sale of the Shares; (iii) suspension of trading in
securities generally on the American Stock Exchange or limitation on prices
(other than limitations on hours or numbers of days of trading) for securities
on such Exchange; (iv) the enactment, publication, decree or other promulgation
of any statute, regulation, rule or order of any court or other governmental
authority which in your opinion materially and adversely affects or may
materially and adversely affect the business or operations of the Company; (v)
declaration of a banking moratorium by United States or New York State
authorities; (vi) the suspension of trading of the
25
Company's Common Shares by the American Stock Exchange, the Commission, or any
other governmental authority; (vii) the taking of any action by any governmental
body or agency in respect of its monetary or fiscal affairs which in your
reasonable opinion has a material adverse effect on the securities markets in
the United States; or (viii) the failure of the conditions set forth in Section
7 of this Agreement to be fulfilled when required to be fulfilled.
(b) This Agreement may be terminated by either you or the Company as
provided in Section 10 of this Agreement.
13. SUCCESSORS.
This Agreement has been and is made solely for the benefit of the Company,
the Advisors and Underwriters and their respective successors, executors,
administrators, heirs and assigns, and the officers, directors and controlling
persons referred to herein, and no other person will have any right or
obligation hereunder. No purchaser of any of the Shares from any Underwriter
shall be deemed a successor or assign merely because of such purchase.
14. INFORMATION PROVIDED BY UNDERWRITERS.
The Company and the Underwriters acknowledge and agree that the only
information furnished or to be furnished by any Underwriter to the Company for
inclusion in any Preliminary Prospectus, Prospectus or the Registration
Statement consists of the information contained in the second paragraph under
the heading "Price Stabilization and Short Positions" under the caption
"Underwriting" in the Prospectus.
15. NO FIDUCIARY DUTY.
Notwithstanding any preexisting relationship, advisory or otherwise,
between the parties or any oral representations or assurances previously or
subsequently made by the Underwriters, the Company acknowledges and agrees that:
(a) nothing herein shall create a fiduciary or agency
relationship between the Company and the Underwriters in connection with any
aspect of the offering of securities hereunder;
(b) the Underwriters are not acting as advisors, expert or otherwise,
to the Company in connection with this offering, the sale of the Shares or any
other services the Underwriters may be deemed to be providing hereunder,
including, without limitation, with respect to the public offering price of the
Shares;
(c) the relationship between the Company and the Underwriters is
entirely and solely commercial, based on arms-length negotiations;
(d) any duties and obligations that the Underwriters may have to the
Company shall be limited to those duties and obligations specifically stated
herein;
(e) notwithstanding anything in this Agreement to the contrary, the
Company acknowledges that the Underwriters may have financial interest in the
success of the offering of
26
the Shares that is not limited to the difference between the price to the public
and the purchase price paid to the Company by the Underwriters for the Shares
and the Underwriters have no obligation to disclose, or account to the Company
for, any of such additional financial interests; and
(f) the Underwriters have advised the Company that the Underwriters
have agreements and understandings with, and owe duties and obligations to,
third parties, including purchasers and potential purchasers of the securities,
that may create or exacerbate actual, potential or apparent conflicts of
interest between the Company and the Underwriters.
16. MASSACHUSETTS BUSINESS TRUST.
A copy of the declaration of trust of the Company is on file with the
Secretary of the Commonwealth of Massachusetts, and notice is hereby given that
this Agreement is executed on behalf of the Company by an officer or trustee of
the Company in his or her capacity as an officer or trustee of the Company and
not individually and that the obligations of or arising out of this instrument
are not binding upon any of the trustees, officers or shareholders individually
but are binding only upon the assets and property of the Company.
17. MISCELLANEOUS.
The reimbursement, indemnification and contribution agreements contained in
this Agreement and the representations, warranties and covenants in this
Agreement shall remain in full force and effect regardless of (a) any
termination of this Agreement, (b) any investigation made by or on behalf of any
Underwriter or controlling person thereof, or by or on behalf of the Company or
the Advisors or any of their respective directors or officers, and (c) delivery
of and payment for the Shares under this Agreement.
This Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York.
This Agreement constitutes the entire agreement of the parties to this
Agreement and supersedes all prior written or oral and all contemporaneous oral
agreements, understandings and negotiations with respect to the subject matter
hereof.
This Agreement may only be amended or modified in writing, signed by all of
the parties hereto, and no condition herein (express or implied) may be waived
unless waived in writing by each party whom the condition is meant to benefit.
[REMAINDER OF PAGE INTENTIONALLY BLANK.]
27
If the foregoing letter is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Advisors and
the several Underwriters in accordance with its terms.
Very truly yours,
RMR ASIA PACIFIC REAL ESTATE FUND
By:
-------------------------------------
Xxxxxx X. X'Xxxxx
President
RMR ADVISORS, INC.
By:
-------------------------------------
Xxxxxx X. X'Xxxxx
President
The foregoing Underwriting Agreement
is hereby confirmed and accepted as of
the date first above written.
RBC CAPITAL MARKETS CORPORATION
As the Representative of the several
Underwriters listed on Schedule I
By:
-------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Managing Director
28
SCHEDULE I
SCHEDULE OF UNDERWRITERS
NUMBER OF
FIRM SHARES TO
UNDERWRITER BE PURCHASED
----------- ---------------
TOTAL UNDERWRITERS (__)