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EXHIBIT 7(b)
$60,000,000
MUNIYIELD NEW JERSEY FUND, INC.
(a Maryland corporation)
AUCTION MARKET PREFERRED STOCK ["AMPS"(R)]
1,200 Shares
Liquidation Preference $50,000 Per Share
PURCHASE AGREEMENT
June 23, 1992
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxxx Xxxxx World Headquarters
World Financial Center
North Tower
New York, New York 10281-1201
Dear Sirs:
MuniYield New Jersey Fund, Inc., a Maryland corporation (the
"Fund"), and Fund Asset Management, Inc., a Delaware corporation (the
"Adviser"), each confirms its agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch,
Xxxxxx, Xxxxxx & Xxxxx Incorporated (the "Underwriter") with respect to the sale
by the Fund and the purchase by the Underwriter of 1,200 shares of auction
market preferred stock (the "Shares") of the Fund, with a par value of $.10 per
share and a liquidation preference of $50,000 per share, plus an amount equal to
accumulated but unpaid dividends (whether or not earned or declared).
Prior to the purchase and public offering of the Shares by the
Underwriter, the Fund and the Underwriter shall enter into an agreement
substantially in the form of Exhibit A hereto (the "Pricing Agreement"). The
Pricing Agreement may take the form of an exchange of any standard form of
written telecommunication between the Fund and the Underwriter and shall specify
such applicable information as is indicated in Exhibit A hereto. The offering of
the Shares will be governed by this Agreement, as supplemented by the Pricing
Agreement. From and after the date of the execution and delivery of the Pricing
Agreement, this Agreement shall be deemed to incorporate the Pricing Agreement.
The Fund has filed with the Securities and Exchange Commission (the
"Commission") a notification on Form N-8A of registration of the Fund as an
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act") and a registration statement on Form N-2 (No. 33-47571) and a
related preliminary prospectus for the registration of the Shares
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(R) Registered trademark of Xxxxxxx Xxxxx & Co., Inc.
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under the Securities Act of 1933, as amended (the "1933 Act"), and the 1940 Act,
and the rules and regulations of the Commission under the 1933 Act and the 1940
Act (the "Rules and Regulations") and has filed such amendments to such
registration statement on Form N-2, if any, and such amended preliminary
prospectuses as may have been required to the date hereof. The Fund will prepare
and file such additional amendments thereto and such amended prospectuses as may
hereafter be required. Such registration statement (as amended at the time it
becomes effective, if applicable) and the prospectus constituting a part thereof
(including in each case the information, if any, deemed to be part thereof
pursuant to Rule 430A(b) of the Rules and Regulations), as from time to time
amended or supplemented pursuant to the 1933 Act, are hereinafter referred to as
the "Registration Statement" and the "Prospectus", respectively, except that if
any revised prospectus shall be provided to the Underwriter by the Fund for use
in connection with the offering of the Shares which differs from the Prospectus
on file at the Commission at the time the Registration Statement becomes
effective (whether such revised prospectus is required to be filed by the Fund
pursuant to Rule 497(b) or Rule 497(h) of the Rules and Regulations), the term
"Prospectus" shall refer to such revised prospectus from and after the time it
is first provided to the Underwriter for such use.
The Fund understands that the Underwriter proposes to make a public
offering of the Shares as soon as the Underwriter deems advisable after the
Registration Statement becomes effective and the Pricing Agreement has been
executed and delivered.
SECTION 1. Representations and Warranties. (a) The Fund and the
Adviser each severally represents and warrants to the Underwriter as of the date
hereof and as of the date of the Pricing Agreement (such later date being
hereinafter referred to as the "Representation Date") as follows:
(i) At the time the Registration Statement becomes effective
and at the Representation Date, the Registration Statement will
comply in all material respects with the requirements of the 1933
Act, the 1940 Act and the Rules and Regulations and will not contain
an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading. At the time the Registration
Statement becomes effective, at the Representation Date and at
Closing Time as defined in Section 2, the Prospectus (unless the
term "Prospectus" refers to a prospectus which has been provided to
the Underwriter by the Fund for use in connection with the offering
of the Shares which differs from the Prospectus on file with the
Commission at the time the Registration Statement becomes effective,
in which case at the time it is first provided to the Underwriter
for such use) will not contain an untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, that the
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with information
furnished to the Fund in writing by the Underwriter expressly for
use in the Registration Statement or Prospectus.
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(ii) The accountants who certified the statement of assets and
liabilities included in the Registration Statement are independent
public accountants as required by the 1933 Act and the Rules and
Regulations.
(iii) The financial statements included in the Registration
Statement present fairly the financial position of the Fund as at
the date indicated and the results of its operations for the period
specified; such financial statements have been prepared in
conformity with generally accepted accounting principles; and the
information in the Prospectus under the headings "Description of
Capital Stock" and "Portfolio Composition" has been fairly
presented.
(iv) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise stated therein, (A) there has been no material adverse
change in the condition, financial or otherwise, of the Fund, or in
the earnings, business affairs or business prospects of the Fund,
whether or not arising in the ordinary course of business, (B) there
have been no transactions entered into by the Fund which are
material to the Fund other than those in the ordinary course of
business and (C) except for regular monthly dividends on the
outstanding shares of common stock, par value $.10 per share
("Common Shares") of the Fund, there has been no dividend or
distribution of any kind declared, paid or made by the Fund or any
class of its capital stock.
(v) The Fund has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of
Maryland, with corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Registration Statement; the Fund is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required; and the Fund
has no subsidiaries.
(vi) The Fund is registered with the Commission under the 1940
Act as a closed-end, non-diversified management investment company,
and no order of suspension or revocation of such registration has
been issued or proceedings therefor initiated or threatened by the
Commission.
(vii) The authorized, issued and outstanding capital stock of
the Fund is as set forth in the Prospectus under the caption
"Description of Capital Stock"; the outstanding Common Shares have
been duly authorized and validly issued and are fully paid and
non-assessable; the Shares have been duly authorized for issuance
and sale to the Underwriter pursuant to this Agreement and, when
issued and delivered by the Fund pursuant to this Agreement against
payment of the consideration set forth in the Pricing Agreement,
will be validly issued and fully paid and nonassessable; the Common
Shares and the Shares conform in all material respects to all
statements relating thereto contained in the Registration Statement;
and the issuance of the Shares to be purchased by the Underwriter is
not subject to preemptive rights.
(viii) The Fund is not in violation of its charter, as amended
(the "Charter") or by-laws, as amended (the "By-Laws") or in default
in the performance or observance of
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any material obligation, agreement, covenant or condition contained
in any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which it is a party or by which it or its
properties may be bound; and the execution and delivery of this
Agreement, the Pricing Agreement and the Investment Advisory
Agreement, the Custodian Agreement, the Auction Agent Agreement and
the Depository Agreement referred to in the Registration Statement
(the "Advisory Agreement", "Auction Agreement", "Custodian
Agreement" and "Letter of Representations", respectively), and the
consummation of the transactions contemplated herein and therein,
will not conflict with or constitute a breach of, or default under,
or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Fund pursuant to any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Fund is a party or by which it may be bound
or to which any of the property or assets of the Fund is subject,
nor will such action result in any violation of the provisions of
the Charter or By-laws of the Fund or, to the best knowledge of the
Fund and the Adviser, any law, administrative regulation or
administrative or court decree; and no consent, approval,
authorization or order of any court or governmental authority or
agency is required for the consummation by the Fund of the
transactions contemplated by this Agreement, the Pricing Agreement,
the Advisory Agreement, the Custodian Agreement, the Auction
Agreement and the Letter of Representations, except such as has been
obtained under the 1940 Act or as may be required under the 1933 Act
or state securities or Blue Sky laws in connection with the purchase
and distribution of the Shares by the Underwriter.
(ix) The Fund owns or possesses or has obtained all material
governmental licenses, permits, consents, orders, approvals and
other authorizations necessary to lease or own, as the case may be,
and to operate its properties and to carry on its businesses as
contemplated in the Prospectus and the Fund has not received any
notice of proceedings relating to the revocation or modification of
any such licenses, permits, covenants, orders, approvals or
authorizations.
(x) There is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now
pending, or, to the knowledge of the Fund or the Adviser, threatened
against or affecting, the Fund, which might result in any material
adverse change in the condition, financial or otherwise, business
affairs or business prospects of the Fund, or might materially and
adversely affect the properties or assets of the Fund; and there are
no material contracts or documents of the Fund which are required to
be filed as exhibits to the Registration Statement by the 1933 Act,
the 1940 Act or by the Rules and Regulations which have not been so
filed.
(xi) The Fund owns or possesses, or can acquire on reasonable
terms, adequate trademarks, service marks and trade names necessary
to conduct the business now operated by it, and the Fund has not
received any notice of infringement of or conflict with asserted
rights of others with respect to any trademarks, service marks and
trade names which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would materially and
adversely affect the conduct of the business, operations, financial
condition or income of the Fund.
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(xii) The Fund intends to, and will, direct the investment of
the proceeds of the offering described in the Registration Statement
in such a manner as to comply with the requirements of Subchapter M
of the Internal Revenue Code of 1986, as amended ("Subchapter M of
the Code"), and intends to qualify as a regulated investment company
under Subchapter M of the Code.
(xiii) This Agreement, the Pricing Agreement, the Advisory
Agreement and the Custodian Agreement have each been duly
authorized, executed and delivered by the Fund and each complies
with all applicable provisions of the 1940 Act.
(xiv) The Auction Agreement and the Letter of Representation
have each been duly authorized for execution and delivery by the
Fund and, when executed and delivered by the Fund, will constitute a
valid and binding obligation of the Fund, enforceable in accordance
with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization or other laws relating to or affecting
creditors' rights and to general equity principles.
(b) The Adviser represents and warrants to the Underwriter as of the
date hereof and as of the Representation Date as follows:
(i) The Adviser has been duly incorporated under the laws of
the State of Delaware with corporate power and authority to conduct
its business as described in the Prospectus.
(ii) The Adviser is duly registered as an investment adviser
under the Investment Advisers Act of 1940, as amended (the "Advisers
Act"), and is not prohibited by the Advisers Act or the 1940 Act or
the rules and regulations under such acts from acting under the
Advisory Agreement for the Fund as contemplated by the Prospectus.
(iii) This Agreement has been duly authorized, executed and
delivered by the Adviser; the Advisory Agreement is in full force
and effect and constitutes a valid and binding obligation of the
Adviser, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization or other laws
relating to or affecting creditors' rights and to general equity
principles; and neither the execution and delivery of this Agreement
nor the performance by the Adviser of its obligations hereunder or
under the Advisory Agreement will conflict with, or result in a
breach of any of the terms and provisions of, or constitute, with or
without the giving of notice or lapse of time or both, a default
under, any agreement or instrument to which the Adviser is a party
or by which it is bound, or any law, order, rule or regulation
applicable to it of any jurisdiction, court, federal or state
regulatory body, administrative agency or other governmental body,
stock exchange or securities association having jurisdiction over
the Adviser or its respective properties or operations.
(iv) The Adviser has the financial resources available to it
necessary for the performance of its services and obligations as
contemplated in the Prospectus.
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(c) Any certificate signed by any officer of the Fund or the Adviser
and delivered to the Underwriter shall be deemed a representation and warranty
by the Fund or the Adviser, as the case may be, to the Underwriter as to the
matters covered thereby.
SECTION 2. Sale and Delivery to the Underwriter; Closing. (a) On the
basis of the representations and warranties herein contained and subject to the
terms and conditions herein set forth, the Fund agrees to sell the Shares to the
Underwriter and the Underwriter agrees to purchase the Shares from the Fund, at
the price per share set forth in the Pricing Agreement.
(i) If the Fund has elected not to rely upon rule 430A under
the Rules and Regulations, the initial public offering price and the
purchase price per share to be paid by the Underwriter for the
Shares each has been determined and set forth in the Pricing
Agreement, dated the date hereof, and an amendment to the
Registration Statement and the Prospectus will be filed before the
Registration Statement becomes effective.
(ii) If the Fund has elected to rely upon rule 430A under the
Rules and Regulations, the purchase price per share to be paid by
the Underwriter for the Shares shall be an amount equal to the
initial public offering price, less an amount per share to be
determined by agreement between the Underwriter and the Fund. The
initial public offering price per share shall be a fixed price to be
determined by agreement between the Underwriter and the Fund. The
initial public offering price and the purchase price, when so
determined, shall be set forth in the Pricing Agreement. In the
event that such prices have not been agreed upon and the Pricing
Agreement has not been executed and delivered by all parties thereto
by the close of business on the fourth business day following the
date of this Agreement, this Agreement shall terminate forthwith,
without liability of any party to any other party, except as
provided in Section 5, unless otherwise agreed to by the Fund, the
Adviser and the Underwriter.
(b) Payment of the purchase price for, and delivery of certificates
for, the Shares shall be made at the office of Brown & Wood LLP, One World Trade
Center, New York, New York 10048-0557 or at such other place as shall be agreed
upon by the Underwriter and the Fund, at 10:00 A.M. on the fifth business day
following the date the Registration Statement becomes effective (or, if the Fund
has elected to rely upon rule 430A under the Rules and Regulations, the fifth
business day after execution of the Pricing Agreement), or such other time not
later than ten business days after such date as shall be agreed upon by the
Underwriter and the Fund (such time and date of payment and delivery being
herein called "Closing Time"). Payment shall be made to the Fund by Federal
funds or checks or similar same-day funds and payable to the order of the Fund,
against delivery to the Underwriter of the certificates for the Shares to be
purchased by it. The Shares shall be represented by a certificate registered in
the name of Cede & Co., as nominee for The Depository Trust Company. The
certificate for the Shares will be made available for examination by the
Underwriter not later than 10:00 A.M. on the last business day prior to Closing
Time.
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SECTION 3. Covenants of the Fund. The Fund covenants with the
Underwriter as follows:
(a) The Fund will use its best efforts (i) to cause the Registration
Statement to become effective under the 1933 Act, and will advise the
Underwriter promptly as to the time at which the Registration Statement and any
amendments thereto (including any post-effective amendment) becomes so effective
and (ii) if required, to cause the issuance of any orders exempting the Fund
from any provisions of the 1940 Act and will advise the Underwriter promptly as
to the time at which any such orders are granted.
(b) The Fund will notify the Underwriter immediately, and confirm
the notice in writing, (i) of the effectiveness of the Registration Statement
and any amendments thereto (including any post-effective amendment), (ii) of the
receipt of any comments from the Commission, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, (iv) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that purpose and
(v) of the issuance by the Commission of an order of suspension or revocation of
the notification on Form N-8A of registration of the Fund as an investment
company under the 1940 Act or initiation of any proceeding for that purpose. The
Fund will make every reasonable effort to prevent the issuance of any stop order
described in subsection (iv) hereunder or any order of suspension or revocation
described in subsection (v) hereunder and, if any stop order or order of
suspension or revocation is issued, to obtain the lifting thereof at the
earliest possible moment.
(c) The Fund will give the Underwriter notice of its intention to
file any amendment to the Registration Statement (including any post-effective
amendment) or any amendment or supplement to the Prospectus (including any
revised prospectus which the Fund proposes for use by the Underwriter in
connection with the offering of the Shares which differs from the prospectus on
file at the Commission at the time the Registration Statement becomes effective,
whether such revised prospectus is required to be filed pursuant to Rule 497(b)
or rule 497(h) of the Rules and Regulations) whether pursuant to the 1940 Act,
the 1933 Act, or otherwise, and will furnish the Underwriter with copies of any
such amendment or supplement a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file any such amendment or
supplement to which the Underwriter or counsel for the Underwriter shall
reasonably object.
(d) The Fund will deliver to the Underwriter, as soon as
practicable, two signed copies of the registration statement as originally filed
and of each amendment thereto, in each case with two sets of the exhibits filed
therewith, and will also deliver to the Underwriter a conformed copy of the
registration statement as originally filed and of each amendment thereto (but
without exhibits to the registration statement or to any such amendment) for the
Underwriter.
(e) The Fund will furnish to the Underwriter, from time to time
during the period when the Prospectus is required to be delivered under the 1933
Act, such number of copies of the Prospectus (as amended or supplemented) as the
Underwriter may reasonably request for the purposes contemplated by the 1933 Act
or the Rules and Regulations.
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(f) If any event shall occur as a result of which it is necessary,
in the opinion of counsel for the Underwriter, to amend or supplement the
Prospectus in order to make the Prospectus not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, the Fund will
forthwith amend or supplement the Prospectus by preparing and furnishing to the
Underwriter a reasonable number of copies of an amendment or amendments of, or a
supplement or supplements to, the Prospectus (in form and substance satisfactory
to counsel for the Underwriter), so that, as so amended or supplemented, the
Prospectus will not contain an untrue statement of a material fact or omit to
state a material fact necessary 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.
(g) The Fund will endeavor, in cooperation with the Underwriter, to
qualify the Shares for offering and sale under the applicable securities laws of
such states and other jurisdictions of the United States as the Underwriter may
designate, and will maintain such qualifications in effect for a period of not
less than one year after the date hereof. The Fund will file such statements and
reports as may be required by the laws of each jurisdiction in which the Shares
have been qualified as above provided.
(h) The Fund will make generally available to its security holders
as soon as practicable, but not later than 60 days after the close of the period
covered thereby, an earnings statement (in form complying with the provisions of
Rule 158 of the Rules and Regulations) covering a twelve-month period beginning
not later than the first day of the Fund's fiscal quarter next following the
"effective" date (as defined is said Rule 158) of the Registration Statement.
(i) Between the date of this Agreement and the termination of any
trading restrictions or Closing Time, whichever is later, the Fund will not,
without your prior consent, offer or sell or enter into any agreement to sell
any equity or equity related securities of the Fund other than the Shares and
Common Shares issued in reinvestment of dividends or distributions.
(j) If, at the time that the Registration Statement becomes
effective, any information shall have been omitted therefrom in reliance upon
Rule 430A of the Rules and Regulations, then immediately following the execution
of the Pricing Agreement, the Fund will prepare and file or transmit for filing
with the Commission in accordance with such Rule 430A and Rule 497(h) of the
Rules and Regulations, copies of an amended Prospectus, or, if required by such
Rule 430A, a post-effective amendment to the Registration Statement (including
an amended Prospectus) containing all information so omitted.
(k) The Fund will use its best efforts to maintain its qualification
as a regulated investment company under Subchapter M of the Code.
SECTION 4. Covenants of the Underwriter. The Underwriter covenants
and agrees with the Fund as follows:
(a) It will sell Shares only to a person who has agreed to execute
and deliver, whose Broker-Dealer (as defined in the Prospectus) has agreed to
execute and deliver or who has already executed and delivered a Master
Xxxxxxxxx's Letter (as defined in the Prospectus) in accordance with the terms
of the Prospectus.
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(b) No later than Closing Time, it will execute and deliver a Master
Xxxxxxxxx's Letter in accordance with the terms of the prospectus.
(c) No later than the second business day succeeding Closing Time,
it will provide the Fund and the Auction Agent (as defined in the Prospectus)
with a list of the persons to whom it has sold Shares, the number of Shares sold
to each such person and the number of Shares it is holding as of the date of
such notice.
SECTION 5. Payment of Expenses. The Fund will pay all expenses
incident to the performance of its obligations under this Agreement, including,
but not limited to, expenses relating to (i) the printing and filing of the
registration statement as originally filed and of each amendment thereto, (ii)
the preparation, issuance and delivery of the certificates for the Shares to the
Underwriter, (iii) the fees and disbursements of the Fund's counsel and
accountants, (iv) the qualification of the Shares under securities laws in
accordance with the provisions of Section 3(g) of this Agreement, including
filing fees and any fees or disbursements of counsel for the Underwriter in
connection therewith and in connection with the preparation of the Blue Sky
Survey, (v) the printing and delivery to the Underwriter of copies of the
registration statement as originally filed and of each amendment thereto, of the
preliminary prospectuses, and of the Prospectus and any amendments or
supplements thereto, (vi) the printing and delivery to the Underwriter of copies
of the Blue Sky Survey and (vii) the fees charged by rating agencies for the
rating of the Shares.
If this Agreement is terminated by the Underwriter in accordance
with the provisions of Section 6 or Section 10(a)(i), the Fund or the Adviser
shall reimburse the Underwriter for all of their out-of-pocket expenses,
including the reasonable fees and disbursements of counsel for the Underwriter.
In the event the transactions contemplated hereunder are not consummated, the
Adviser agrees to pay all of the costs and expenses set forth in the first
paragraph of this Section 5 which the Fund would have paid if such transactions
had been consummated.
SECTION 6. Conditions of Underwriter's Obligations. The obligations
of the Underwriter hereunder are subject to the accuracy of the representations
and warranties of the Fund and the Adviser herein contained, to the performance
by the Fund and the Adviser of their respective obligations hereunder, and to
the following further conditions:
(a) The Registration Statement shall have become effective not later
than 5:30 P.M., New York City time, on the date hereof or at such later time and
date as may be approved by the Underwriter, and at Closing Time no stop order
suspending the effectiveness of the Registration Statement shall have been
issued under the 1933 Act or proceedings therefor initiated or threatened by the
Commission. If the Fund has elected to rely upon Rule 430A of the Rules and
Regulations, the price of the Shares and any price-related information
previously omitted from the effective Registration Statement pursuant to such
Rule 430A shall have been transmitted to the Commission for filing pursuant to
Rule 497(h) of the Rules and Regulations within the prescribed time period, and
prior to Closing Time the Fund shall have provided evidence satisfactory to the
Underwriter of such timely filing, or a post-effective amendment providing such
information shall have been promptly filed and declared effective in accordance
with the requirements of Rule 430A of the Rules and Regulations.
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(b) At Closing Time, the Underwriter shall have received:
(i) The favorable opinion, dated as of Closing Time, of Brown
& Wood LLP, counsel for the Fund and the Underwriter, to the effect
that:
(1) The Fund has been duly organized and is
validly existing as a corporation in good standing under
the laws of the State of Maryland.
(2) The Fund has corporate power and
authority to own, lease and operate its properties and
conduct its business as described in the Prospectus.
(3) The Fund is duly qualified as a foreign
corporation to transact business and is in good standing
in each jurisdiction in which such qualification is
required, except where the failure to so qualify would
not have a material adverse effect on the condition,
financial or otherwise, business affairs or business
prospects of the Fund.
(4) The outstanding Common Shares have been
duly authorized and validly issued and are fully paid
and non-assessable.
(5) The Shares have been duly authorized for
issuance and sale to the Underwriter pursuant to this
Agreement and, when issued and delivered by the Fund
pursuant to this Agreement against payment of the
consideration set forth in the Pricing Agreement, will
be validly issued and fully paid and non-assessable; the
issuance of the Shares is not subject to preemptive or
other similar rights; and the authorized capital stock
conforms in all material respects to the description
thereof in the Registration Statement.
(6) This Agreement and the Pricing Agreement
each has been duly authorized, executed and delivered by
the Fund and each complies with all applicable
provisions of the 1940 Act.
(7) The Registration Statement is effective
under the 1933 Act and, to the best of their knowledge
and information, no stop order suspending the
effectiveness of the Registration Statement has been
issued under the 1933 Act and no proceedings for that
purpose have been instituted, are pending or are
contemplated.
(8) At the time the Registration Statement
became effective and at the Representation Date, the
Registration Statement (other than the financial
statements included therein, as to which no opinion need
be rendered) complied as to form in all material
respects with the requirements of the 1933 Act, the 1940
Act and the Rules and Regulations.
(9) To the best of their knowledge and
information, there are no legal or governmental
proceedings pending or threatened against the Fund which
are required to be disclosed in the Registration
Statement, other than those disclosed therein.
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(10) To the best of their knowledge and
information, there are no contracts, indentures,
mortgages, loan agreements, notes, leases or other
instruments of the Fund required to be described or
referred to in the Registration Statement or to be filed
as exhibits thereto other than those described or
referred to therein or filed as exhibits thereto, the
descriptions thereof or references thereto are correct,
and no default exists in the due performance or
observance of any material obligation, agreement,
covenant or condition contained in any contract,
indenture, loan agreement, note or lease so described,
referred to or filed.
(11) No consent, approval, authorization or
order of any court or governmental authority or agency
is required in connection with the sale of the Shares to
the Underwriter, except such as has been obtained under
the 1933 Act, the 1940 Act or the Rules and Regulations
or such as may be required under state securities laws;
and to the best of their knowledge and information, the
execution and delivery of this Agreement, the Pricing
Agreement, the Advisory Agreement, the Custodian
Agreement, the Auction Agreement and the Depository
Agreement and the consummation of the transactions
contemplated herein and therein will not conflict with
or constitute a breach of, or default under, or result
in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Fund
pursuant to any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the
Fund is a party or by which it may be bound or to which
any of the property or assets of the Fund is subject,
nor will such action result in any violation of the
provisions of the Charter or By-Laws of the Fund, or any
law, administrative regulation or administrative or
court decree.
(12) The Advisory Agreement and the
Custodian Agreement have each been duly authorized,
executed and delivered by the Fund and each complies
with all applicable provisions of the 1940 Act.
(13) The Fund is registered with the
Commission under the 1940 Act as a closed-end
non-diversified management investment company, and all
required action has been taken by the Fund under the
1933 Act, the 1940 Act and the Rules and Regulations to
make the public offering and consummate the sale of the
Shares pursuant to this Agreement; the provisions of the
Charter and By-Laws of the Fund comply as to form in all
material respects with the requirements of the 1940 Act;
and, to the best of their knowledge and information, no
order of suspension or revocation of such registration
under the 1940 Act, pursuant to Section 8(e) thereof,
has been issued or proceedings therefor initiated or
threatened by the Commission.
(14) The information in the Prospectus under
the caption "Taxes" to the extent that it constitutes
matters of law or legal conclusions, has been reviewed
by them and is correct in all material respects.
(15) The Auction Agreement and the
Depository Agreement each have been duly authorized,
executed and delivered by the Fund and each constitutes
a valid and binding obligation of the Fund, enforceable
in accordance with its
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terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization or other laws relating to or
affecting creditors' rights and to general equity
principles.
(ii) The favorable opinion, dated as of the Closing Time, of
Xxxxxxx & Xxxxxx, special counsel for the Fund, to the effect that:
(1) The information in the Prospectus under
the caption "Taxes" to the extent that it constitutes
matters of New Jersey law or legal conclusions involving
matters of New Jersey law, has been reviewed by them and
is correct in all material respects.
(2) Nothing has come to their attention that
would lead them to believe that the information in the
Registration Statement under the caption "Investment
Objective and Policies -- Special Considerations
Relating to New Jersey Municipal Bonds" and in Appendix
A entitled "Economic Conditions in New Jersey", at the
time it became effective or at the Representation Date,
contained an untrue statement of a material fact or
omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading or that the information under such caption
and in such appendix in the Prospectus, at the
Representation Date (unless the term "Prospectus" refers
to a prospectus which has been provided to the
Underwriter by the Fund for use in connection with the
offering of the Shares which differs from the Prospectus
on file at the Commission at the time the Registration
Statement becomes effective, in which case at the time
they are first provided to the Underwriter for such use)
or at Closing Time, included an untrue statement of a
material fact or omitted 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.
(iii) The favorable opinion, dated as of Closing Time, of
Xxxxxx X. Xxxxxxxx, Esq., General Counsel to the Adviser, in form
and substance satisfactory to counsel for the Underwriter, to the
effect that:
(1) The Adviser has been duly organized as a
corporation under the laws of the State of Delaware with
corporate power and authority to conduct its business as
described in the Registration Statement and the
Prospectus.
(2) The Adviser is duly registered as an
investment adviser under the Advisers Act and is not
prohibited by the Advisers Act or the 1940 Act or the
rules and regulations under such Acts from acting under
the Advisory Agreement for the Fund as contemplated by
the Prospectus.
(3) This Agreement has been duly authorized,
executed and delivered by the Adviser; the Advisory
Agreement is in full force and effect and constitutes a
valid and binding obligation of the Adviser, enforceable
in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization
or other laws relating to or affecting creditors' rights
and to general equity principles; and, to the best of
his knowledge and information, neither the execution and
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delivery of this Agreement or the Advisory Agreement nor
the performance by the Adviser of its obligations
hereunder or thereunder will conflict with, or result in
a breach of, any of the terms and provisions of, or
constitute, with or without giving notice or lapse of
time or both, a default under, any agreement or
instrument to which it is a party or by which the
Adviser is bound, or any law, order, rule or regulation
applicable to the Adviser of any Jurisdiction, court,
Federal or state regulatory body, administrative agency
or the governmental body, stock exchange or securities
association have jurisdiction over the Adviser or its
respective properties or operations.
(4) To the best of his knowledge and
information, the description of the Adviser in the
Registration Statement and the Prospectus does 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.
(iv) In giving their opinion required by subsection (b)(i) of
this Section, Brown & Wood LLP shall additionally state that nothing
has come to their attention that would lead them to believe that the
Registration Statement (excluding the financial statements and
financial schedules included therein, as to which such counsel need
express no belief), at the time it became effective or at the
Representation Date, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading
or that the Prospectus (except for the financial statements and
financial schedules included therein as to which such counsel need
express no belief), at the Representation Date (unless the term
"Prospectus" refers to a prospectus which has been provided to the
Underwriter by the Fund for use in connection with the offering of
the Shares which differs from the Prospectus on file at the
Commission at the time the Registration Statement becomes effective,
in which case at the time it is first provided to the Underwriter
for such use) or at Closing Time, included an untrue statement of a
material fact or omitted 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. In giving their opinion,
Xxxxx & Wood LLP may rely, as to all matters governed by the law of
the State of Maryland, upon the opinion of Xxxxxxx, Xxxxxxx and
Xxxxxx and Xxxxx & Xxxx LLP may rely, as to matters of fact upon
certificates and written statements of officers and employees of and
accountants of the Fund and the Advisor and of public officials.
(c) At Closing Time (i) the Registration Statement and the
Prospectus shall contain all statements which are required to be stated therein
in accordance with the 1933 Act, the 1940 Act and the Rule and Regulations and
in all material respects shall conform to the requirements of the 1933 Act, the
1940 Act and the Rules and Regulations and the Prospectus shall not contain any
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 and no action, suit or proceeding at law or in
equity shall be pending or, to the knowledge of the Fund or the Adviser,
threatened against the Fund or the Adviser which would be required to be set
forth in the Prospectus other than as set forth therein, (ii) there shall not
have been, since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change in the
condition, financial or otherwise, of the Fund or
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in its earnings, business affairs or business prospects, whether or not arising
in the ordinary course of business, from that set forth in the Registration
Statement and Prospectus, (iii) the Adviser shall have the financial resources
available to it necessary for the performance of its services and obligations as
contemplated in the Registration Statement and the Prospectus, (iv) no
proceedings shall be pending or, to the knowledge of the Fund or the Adviser,
threatened against the Fund or the Adviser before or by any Federal, state or
other commission, board or administrative agency wherein an unfavorable
decision, ruling or finding would materially and adversely affect the business,
property, financial condition or income of either the Fund or the Adviser other
than as set forth in the Registration Statement and the Prospectus and (v)
Xxxxx'x Investors Service, Inc. ("Moody's") and Standard & Poor's Corporation
("S&P") shall have confirmed that the Shares have been rated "aaa" and AAA
respectively, by such agencies; and the Underwriter shall have received, at
Closing Time, a certificate of the President or Treasurer of the Fund and of the
President or a Vice President of the Adviser dated as of Closing Time,
evidencing compliance with the appropriate provisions of this subsection (c),
together with true and correct copies of letters from Moody's and S&P confirming
their rating.
(d) At Closing Time, the Underwriter shall have received
certificates, dated as of Closing Time, (i) of the President or Treasurer of the
Fund to the effect that the representations and warranties of the Fund contained
in Section 1(a) are true and correct with the same force and effect as though
expressly made at and as of Closing Time and (ii) of the President or a Vice
President of the Adviser contained in Sections 1(a) and (b) are true and correct
with the same force and effect as though expressly made at and as of Closing
Time.
(e) At the time of execution of this Agreement, the Underwriters
shall have received from Deloitte & Touche a letter, dated the date hereof, in
form and substance satisfactory to the Underwriter, to the effect that:
(i) they are independent accountants with respects to the Fund
within the meaning of the 1933 Act and the Rules and Regulations;
(ii) in their opinion, the statement of assets and liabilities
examined by them and included in the Registration Statement complies
as to form in all material respects with the applicable accounting
requirements of the 1933 Act and 1940 Act and the Rules and
Regulations;
(iii) they have performed specified procedures, not
constituting an audit, including a reading of the latest available
interim financial statements of the Fund, a reading of the minute
books of the Fund, inquiries of officials of the Fund responsible
for financial accounting matters and such other inquiries and
procedures as may be specified in such letter, and on the basis of
such inquiries and procedures nothing came to their attention that
caused them to believe that (A) the unaudited financial statements
as of May 31, 1992, and for the period ended May 31, 1992, included
in the Registration Statement do not comply as to form in all
material respects with the applicable accounting requirements of the
1933 Act and the 1933 Act Regulations applicable to unaudited
interim financial statements included in registration statements or
are not in conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the audited
financed statements included in the Registration
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Statement and (B) during the period from May 31, 1992 to a specified
date not more than five days prior to the date of this Agreement,
there was any change in the capital stock or net assets of the Fund,
or any increase in the long-term debt of the Fund, as compared with
amounts shown on the unaudited financial statements included in the
Registration Statement, except for changes which the Registration
Statement disclosed have occurred or may occur; and
(iv) in addition to the procedures referred to in clause (iii)
above, they have performed other specified procedures, not
constituting an audit, with respect to certain amounts, percentages,
numerical data, financial information and financial statements
appearing in the Registration Statement, which have previously been
specified by you and which shall be specified in such letter, and
have compared certain of such items with, and have found such items
to be in agreement with, the accounting and financial records of the
Fund.
(f) At Closing Time, the Underwriter shall have received from
Deloitte & Touche a letter, dated as of Closing Time, to the effect that they
reaffirm the statements made in the letter furnished pursuant to subsection (e)
of this Section, except that the "specified date" referred to shall be a date
not more than five days prior to Closing Time.
(g) At Closing Time, counsel for the Underwriter shall have been
furnished with such documents and opinions as they may reasonably require for
the purpose of enabling them to pass upon the issuance and sale of the Shares as
herein contemplated and to pass upon related proceedings, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Fund and the Adviser in connection with the organization and
registration of the Fund under the 1940 Act and the issuance and sale of the
Shares as herein contemplated shall be satisfactory in form and substance to the
Underwriter and counsel for the Underwriter.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriter by notice to the Fund at any time at or prior to Closing
Time, and such termination shall be without liability of any party to any other
party except as provided in Section 5.
SECTION 7. Indemnification. (a) The Fund and the Adviser, jointly
and severally, agree to indemnify and hold harmless the Underwriter and each
person, if any, who controls the Underwriter within the meaning of Section 15 of
the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the
information deemed to be part of the Registration Statement pursuant
to Rule 430A of the Rules and Regulations, if applicable, or the
omission or alleged omission therefrom of a material fact required
to be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus
or the Prospectus (or any amendment or supplement thereto) or the
omission or alleged
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omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading;
(ii) against any and all loss, liability claim, damage and
expense whatsoever as incurred to the extent of the aggregate amount
paid in settlement of any litigation, or investigation or proceeding
by any governmental agency or body, commenced or threatened or of
any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, if such
settlement is effected with the written consent of the Fund; and
(iii) against any and all expense whatsoever (including the
fees and disbursements of counsel chosen by the Underwriter)
reasonably incurred in investigating, preparing or defending against
any litigation or investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue statement or omission, to the extent such
alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement does not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Fund by the
Underwriter expressly for use in the Registration Statement (or any amendment
thereto) or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto).
(b) The Underwriter severally agrees to indemnify and hold harmless
the Fund and the Adviser, their respective directors, each of the Fund's
officers who signed the Registration Statement, and each person, if any, who
controls the Fund or the Adviser within the meaning of Section 15 of the 1933
Act, against any and all loss, liability, claim, damage and expense described in
the indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment or supplement
thereto) or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Fund by the Underwriter expressly for use in the Registration
Statement (or any amendment thereto) or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure to
so notify an indemnifying party shall not relieve it from any liability which it
may have otherwise than on account of this indemnity agreement. An indemnifying
party may participate at its own expense in the defense of such action. In no
event shall the indemnifying parties be liable for the fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances.
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SECTION 8. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 7 is for any reason held to be enforceable by the indemnified parties
although applicable in accordance with its terms, the Fund and the Underwriter
shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by said indemnity agreement as incurred by
the Fund and the Underwriter, as incurred, in such proportions that the
Underwriter is responsible for that portion represented by the percentage that
the underwriting compensation payable pursuant to Section 2 hereof bears to the
initial public offering price appearing on the cover page of the Prospectus and
the Fund is responsible for the balance; provided, however, that no person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the 1933 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. Notwithstanding provisions of this
Section 8, no Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Shares underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay in respect
of such losses, liabilities, claims, damages and expenses. For purposes of this
Section, each person, if any, who controls the Underwriter within the meaning of
Section 15, of the 1933 Act shall have the same rights to contribution as the
Underwriter, and each director of the Fund, each officer of the Fund who signed
the Registration Statement, and each person, if any, who controls the Fund
within the meaning of Section 15 of the 1933 Act shall have the same rights to
contribution as the Underwriter, and each director of the Fund, each officer of
the Fund who signed the Registration Statement, and each person, if any, who
controls the Fund within the meaning of Section 15 of the 1933 Act shall have
the same rights to contribution as the Fund.
SECTION 9. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement and the Pricing Agreement, or contained in certificates of officers of
the Fund or the Adviser submitted pursuant hereto, shall remain operative and in
full force and effect, regardless of any investigation made by or on behalf of
the Underwriter or controlling person, or by or on behalf of the Fund or the
Adviser and shall survive delivery of the Shares to the Underwriter.
SECTION 10. Termination of Agreement. (a) The Underwriter, by notice
to the Fund, may terminate this Agreement at any time or prior to Closing Time
(i) if there has been, since the date of this Agreement or since the respective
dates as of which information is given in the Registration Statement, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Fund or the Adviser,
whether or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States or any outbreak of hostilities or escalation thereof or other calamity or
crisis the effect of which is such as to make it, in the Underwriter's judgment,
impracticable to market the Shares or enforce contracts for the sale of the
Shares, or (iii) if trading in the Common Shares has been suspended by the
Commission or if trading generally on either the American Stock Exchange or the
New York Stock Exchange has been suspended, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices for securities have been
required, by either of said exchanges or by order of the Commission or any other
governmental authority, or if a banking moratorium has been declared by Federal
or New York authorities.
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(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party except as
provided in Section 5.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of written telecommunication. Notices to the
Underwriter shall be directed to Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated at Xxxxxxx Xxxxx World Headquarters, North Tower,
World Financial Center, New York, New York 10281-1201, Attention: Xxxxxxx Xxxxx,
Vice President; notices to the Fund or the Adviser shall be directed to each of
them at 000 Xxxxxxxx Xxxx Xxxx, Xxxxxxxxxx, Xxx Xxxxxx, 00000, Attention:
Xxxxxx Xxxxxx.
SECTION 12. Parties. This Agreement and the Pricing Agreement shall
inure to the benefit of and be binding upon the Underwriter, the Fund, the
Adviser and their respective successors. Nothing expressed or mentioned in this
Agreement or the Pricing Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to in
Sections 7 and 8 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and the Pricing Agreement and all
conditions and provisions hereof are intended to be for the sole and exclusive
benefit of the parties hereto and thereto and their respective successors, and
said controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Shares from the Underwriter shall be deemed to be a successor by
reason merely of such purchase.
SECTION 13. Governing Law and Time. This Agreement and the Pricing
Agreement shall be governed by the laws of the State of New York applicable to
agreements made and to be performed in said State. Specified times of day refer
to New York City time.
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If the foregoing is in accordance with your understanding of our
Agreement, please sign and return to us a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the Underwriter, the Fund and the Adviser in accordance with its terms.
Very truly yours,
MUNIYIELD NEW JERSEY FUND, INC.
By:
---------------------------------
Authorized Officer
FUND ASSET MANAGEMENT, INC.
By:
---------------------------------
Authorized Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
By: Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
By:
---------------------------------------------
Vice President
Investment Banking
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