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EXHIBIT 2(h)(1)
_________ Shares
THE GABELLI EQUITY TRUST INC.
____% Cumulative Preferred Stock
Liquidation Preference $25 Per Share
UNDERWRITING AGREEMENT
_______ __, 1998
XXXXXXX XXXXX XXXXXX INC.
GABELLI & COMPANY, INC.
As Representatives of the Several Underwriters
c/o XXXXXXX XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The Gabelli Equity Trust Inc., a Maryland corporation (the
"Fund"), proposes, upon the terms and conditions set forth herein, to issue and
sell an aggregate of ___________ shares (the "Initial Shares") of its ____%
cumulative preferred stock, liquidation preference $25 per share, $.001 par
value per share (the "Cumulative Preferred Stock"), to the several Underwriters
named in Schedule I hereto. In addition, the Fund agrees to grant to the
Underwriters an option to purchase _________ additional shares to cover
over-allotments, if any (the "Option Shares", and together with the Initial
Shares, the "Shares"). The Cumulative Preferred Stock will be authorized by,
and subject to the terms and conditions of, the Articles Supplementary to be
adopted in connection with the issuance of the Cumulative Preferred Stock (the
"Articles Supplementary").
The Fund and its investment adviser, Gabelli Funds, Inc., a
New York corporation (the "Adviser"), wish to confirm as follows their
agreement with you (the "Representatives") and the other several Underwriters
on whose behalf you are acting, in connection with the several purchases of the
Shares by the Underwriters.
The Fund has entered into an investment advisory agreement
dated ___________ with the Adviser, a custodian agreement dated ___________
with State Street Bank and Trust Company, a Massachusetts corporation, and a
registrar, transfer agency and service agreement dated __________ with State
Street Bank and Trust Company. Such agreements are hereinafter referred to as
the "Investment Advisory Agreement", the "Custodian Agreement" and the
"Transfer Agency Agreement", respectively. Collectively, the Investment
Advisory Agreement, the Custodian Agreement and the Transfer Agency Agreement
are hereinafter
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referred to as the "Fund Agreements". This Underwriting Agreement is
hereinafter referred to as the "Agreement".
1. Registration Statement and Prospectus. The Fund has
prepared in conformity with the provisions of the Securities Act of 1933, as
amended (the "1933 Act"), the Investment Company Act of 1940, as amended (the
"1940 Act") and the rules and regulations of the Securities and Exchange
Commission (the "Commission") promulgated under the 1933 Act (the "1933 Act
Rules and Regulations") and the 1940 Act (the "1940 Act Rules and Regulations"
and, together with the 1933 Act Rules and Regulations, the "Rules and
Regulations") a registration statement on Form N-2 (File Nos. 333-_____ and
811-4700) under the 1933 Act and the 1940 Act (the "registration statement"),
including a prospectus relating to the Shares, and has filed the registration
statement and prospectus in accordance with the 1933 Act and 1940 Act. The
Fund also has filed a notification of registration of the Fund as an investment
company under the 1940 Act on Form N-8A (the "1940 Act Notification"). The
term "Registration Statement" as used in this Agreement means the registration
statement (including all financial schedules and exhibits), as amended at the
time it becomes effective under the 1933 Act or, if the registration statement
became effective under the 1933 Act prior to the execution of this Agreement,
as amended or supplemented at the time it became effective, prior to the
execution of this Agreement. If it is contemplated, at the time this Agreement
is executed, that a post-effective amendment to the registration statement will
be filed under the 1933 Act and must be declared effective before the offering
of the Shares may commence, the term "Registration Statement" as used in this
Agreement means the registration statement as amended by said post-effective
amendment. If the Fund has filed an abbreviated registration statement to
register an additional amount of Shares pursuant to Rule 462(b) under the 1933
Act (the "Rule 462 Registration Statement"), then any reference herein to the
term "Registration Statement" shall include such Rule 462 Registrations
Statement. The term "Prospectus" as used in this Agreement means the
prospectus and statement of additional information in the forms included in the
Registration Statement or, if the prospectus and statement of additional
information included in the Registration Statement omit information in reliance
on Rule 430A under the 1933 Act Rules and Regulations and such information is
included in a prospectus and statement of additional information filed with the
Commission pursuant to Rule 497(h) under the 1933 Act, the term "Prospectus" as
used in this Agreement means the prospectus and statement of additional
information in the forms included in the Registration Statement as supplemented
by the addition of the information contained in the prospectus filed with the
Commission pursuant to Rule 497(h). The term "Prepricing Prospectus" as used
in this Agreement means the prospectus and statement of additional information
subject to completion in the forms included in the registration statement at
the time of filing of amendment No. 1 to the registration statement with the
Commission on _______ __, 1998 and as such prospectus and statement of
additional information shall have
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been amended from time to time prior to the date of the Prospectus, together
with any other prospectus and statement of additional information relating to
the Fund other than the Prospectus, approved in writing by or directly or
indirectly prepared by the Fund or the Adviser; it being understood that the
definition of Prepricing Prospectus above shall not include any Prepricing
Prospectus prepared by any Underwriter unless approved in writing by the Fund
or Adviser. The terms "Registration Statement", "Prospectus" and "Prepricing
Prospectus" shall also include any financial statements incorporated by
reference therein.
The Fund has furnished the Representatives with copies of such
registration statement, each amendment to such registration statement filed
with the Commission and each Prepricing Prospectus.
2. Agreements to Sell and Purchase. The Fund hereby
agrees, subject to all the terms and conditions set forth herein, to issue and
sell to each Underwriter and, upon the basis of the representations, warranties
and agreements of the Fund and the Adviser herein contained and subject to all
the terms and conditions set forth herein, each Underwriter agrees, severally
and not jointly, to purchase from the Fund, at a purchase price of $_________
per Initial Share, the number of Shares set forth opposite the name of such
Underwriter in Schedule I hereto (or such number of Shares increased as set
forth in Section 11 hereof). In addition, subject to the conditions herein set
forth, the Fund grants an option to the Underwriters, severally and not
jointly, to purchase up to the number or aggregate principal amount, as the
case may be, of the Option Shares at a price per Option Share equal to the
price per Initial Share, less an amount equal to any dividends or distributions
declared by the Fund and paid or payable on the Initial Shares but not payable
on the Option Shares. Such option, will expire 30 days after the
Representation Date relating to the Initial Shares, and may be exercised in
whole or in part from time to time only for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Initial Shares upon notice by Xxxxxxx Xxxxx Xxxxxx Inc. to
the Fund setting forth the number or aggregate principal amount, as the case
may be, of Option Shares as to which the several Underwriters are then
exercising the option and the time, date and place of payment and delivery for
such Option Shares. Any such time and date of payment and delivery (each, a
"Date of Delivery") shall be determined by Xxxxxxx Xxxxx Xxxxxx Inc., but shall
not be later than seven full business days after the exercise of said option,
nor in any event prior to the Closing Date, unless otherwise agreed upon by
Xxxxxxx Xxxxx Xxxxxx Inc. and the Fund. If the option is exercised as to all
or any portion of the Option Shares, each of the Underwriters, severally and
not jointly, will purchase that proportion of the total number or aggregate
principal amount, as the case may be, of Option Shares then being purchased
which the number or principal amount, as the case may be, of Initial Shares
each such
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Underwriter has severally agreed to purchase as set forth in Schedule I hereto
bearing the total number or aggregate principal amount, as the case may be, of
Initial Shares, subject to such adjustments as Xxxxxxx Xxxxx Xxxxxx Inc. in its
discretion shall make to eliminate any sales or purchases of a fractional
number or aggregate principal amount, as the case may be, of Option Shares.
3. Terms of Public Offering. The Fund and the Adviser
have been advised by you that the Underwriters propose to make a public
offering of their respective portions of the Shares as soon after the
Registration Statement and this Agreement have become effective as in your
judgment is advisable and initially to offer the Shares upon the terms set
forth in the Prospectus.
4. Delivery of the Shares and Payment Therefor.
Delivery to the Underwriters of and payment for the Shares shall be made at the
office of Xxxxxxx Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000,
at 10:00 A.M., New York City time, on _______ __, 1998 (the "Closing Date").
The place of closing for the Shares and the Closing Date may be varied by
agreement between you and the Fund. In addition, in the event that the
Underwriters have exercised their option to purchase any or all of the Option
Shares, payment of the purchase price for, and delivery of such Option Shares,
shall be made at the above-mentioned offices of Xxxxxxx Xxxxx Xxxxxx Inc. or at
such other place as shall be agreed upon by Xxxxxxx Xxxxx Xxxxxx Inc. and the
Fund, on the relevant Date of Delivery as specified in the notice from Xxxxxxx
Xxxxx Xxxxxx Inc. to the Fund.
Certificates for the Shares shall be registered in such names
and in such denominations as you shall request prior to 9:30 A.M., New York
City time, on the second business day preceding the Closing Date. Such
certificates shall be made available to you in New York City for inspection and
packaging not later than 9:30 A.M., New York City time, on the business day
next preceding the Closing Date. The certificates evidencing the Shares shall
be delivered to you on the Closing Date against payment of the purchase price
therefor in immediately available funds.
5. Agreements of the Fund and the Adviser. The Fund and
the Adviser, jointly and severally, agree with the several Underwriters as
follows:
(a) If, at the time this Agreement is executed and
delivered, it is necessary for the Registration Statement or a post-effective
amendment thereto to be declared effective under the 1933 Act before the
offering of the Shares may commence, the Fund will endeavor to cause the
Registration Statement or such post-effective amendment to become effective
under the 1933 Act as soon as possible and will advise you promptly and, if
requested by you, will confirm such advice in writing when the Registration
Statement or such post-effective amendment has become effective.
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(b) The Fund will advise you promptly and, if requested
by you, will confirm such advice in writing: (i) of any request made by the
Commission for amendment of or a supplement to the Registration Statement, any
Prepricing Prospectus or the Prospectus (or any amendment or supplement to any
of the foregoing) or for additional information, (ii) of the issuance by the
Commission, the National Association of Securities Dealers, Inc. (the "NASD"),
any state securities commission, any national securities exchange, any
arbitrator, any court or any other governmental, regulatory, self-regulatory or
administrative agency or any official of any order suspending the effectiveness
of the Registration Statement, prohibiting or suspending the use of the
Prospectus, any Prepricing Prospectus or any sales material (as hereinafter
defined), of any notice pursuant to Section 8(e) of the 1940 Act, of the
suspension of qualification of the Shares for offering or sale in any
jurisdiction, or the initiation of any proceeding for any such purposes, (iii)
of receipt by the Fund, the Adviser, any affiliate of the Fund or the Adviser
or any representative or attorney of the Fund or the Adviser of any other
material communication from the Commission, the NASD, any state securities
commission, any national securities exchange, any arbitrator, any court or any
other governmental, regulatory, self-regulatory or administrative agency or any
official relating to the Fund (if such communication relating to the Fund is
received by such person within three years after the date of this Agreement),
the Registration Statement, the 1940 Act Notification, the Prospectus, any
Prepricing Prospectus, any sales material (as hereinafter defined) (or any
amendment or supplement to any of the foregoing), this Agreement or any of the
Fund Agreements and (iv) within the period of time referred to in paragraph (f)
below, of any material adverse change in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the
Fund or the Adviser or of the happening of any event which makes any statement
of a material fact made in the Registration Statement, the Prospectus or any
sales material (as herein defined) (or any amendment or supplement to any of
the foregoing) untrue or which requires the making of any additions to or
changes in the Registration Statement, the Prospectus, any Prepricing
Prospectus or any sales materials (as herein defined) (or any amendment or
supplement to any of the foregoing) in order to state a material fact required
by the 1933 Act, the 1940 Act or the Rules and Regulations to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading or of the necessity to
amend or supplement the Registration Statement, the Prospectus, any Prepricing
Prospectus or any sales material (as herein defined) (or any amendment or
supplement to any of the foregoing) to comply with the 1933 Act, the 1940 Act,
the Rules and Regulations or any other law or order of any court or regulatory
body. If at any time the Commission, the NASD, any state securities
commission, any national securities exchange, any arbitrator, any court or any
other governmental, regulatory, self-regulatory or administrative agency or any
official shall
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issue any order suspending the effectiveness of the Registration Statement,
prohibiting or suspending the use of the Prospectus or any sales material (as
hereinafter defined) (or any amendment or supplement to any of the foregoing)
or suspending the qualification of the Shares for offering or sale in any
jurisdiction, the Fund will make every reasonable effort to obtain the
withdrawal of such order at the earliest possible time.
(c) The Fund will furnish to you, without charge, three
copies of the registration statement and the 1940 Act Notification as
originally filed with the Commission and of each amendment thereto, including
financial statements and all exhibits thereto, one copy of each of which shall
be signed, and will also furnish to you, without charge, such number of
additional copies of the registration statement and of each amendment thereto,
but without exhibits, as you may request.
(d) The Fund will not (i) file any amendment to the
Registration Statement or make any amendment or supplement to the Prospectus,
or any sales material (as hereinafter defined) of which you shall not
previously have been advised or to which you shall object after being so
advised or (ii) so long as, in the opinion of counsel for the Underwriters, a
Prospectus is required by the 1933 Act to be delivered in connection with sales
by any Underwriter or dealer, file any information, documents or reports
pursuant to the Securities Exchange Act of 1934, as amended (the "1934 Act"),
without delivering a copy of such information, documents or reports to you, as
Representatives of the Underwriters, prior to or concurrently with such filing.
(e) Prior to the execution and delivery of this
Agreement, the Fund has delivered to you, without charge, in such quantities as
you have requested, copies of each form of the Prepricing Prospectus. The Fund
consents to the use, in accordance with the provisions of the 1933 Act and with
the state securities or blue sky laws of the jurisdictions in which the Shares
are offered by the several Underwriters and by dealers, prior to the date of
the Prospectus, of each Prepricing Prospectus so furnished by the Fund.
(f) As soon after the execution and delivery of this
Agreement as possible and thereafter from time to time for such period as in
the opinion of counsel for the Underwriters a prospectus is required by the
1933 Act to be delivered in connection with sales by any Underwriter or dealer,
the Fund will expeditiously deliver to each Underwriter and each dealer,
without charge, as many copies of the Prospectus (and of any amendment or
supplement thereto) as you may request. The Fund consents to the use of the
Prospectus (and of any amendment or supplement thereto) in accordance with the
provisions of the 1933 Act and with the state securities or blue sky laws of
the jurisdictions in which the Shares are offered by the several Underwriters
and by all dealers to whom Shares may be sold, both in connection with the
offering and sale of the Shares and for
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such period of time thereafter as the Prospectus is required by the 1933 Act to
be delivered in connection with sales by any Underwriter or dealer. If during
such period of time any event shall occur that in the judgment of the Fund or
in the opinion of counsel for the Underwriters is required to be set forth in
the Registration Statement or the Prospectus (as then amended or supplemented)
or should be set forth therein in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it
is necessary to supplement or amend the Registration Statement or the
Prospectus to comply with the 1933 Act, the 1940 Act, the Rules and Regulations
or any other federal law, rule or regulation, or any state securities or blue
sky disclosure laws, rules or regulations, the Fund will forthwith prepare and,
subject to the provisions of paragraph (d) above, promptly file with the
Commission an appropriate supplement or amendment thereto, and will
expeditiously furnish to the Underwriters and dealers, without charge, a
reasonable number of copies thereof. In the event that the Fund and you, as
Representatives of the several Underwriters, agree that the Registration
Statement or the Prospectus should be amended or supplemented, the Fund, if
requested by you, will promptly issue a press release announcing or disclosing
the matters to be covered by the proposed amendment or supplement.
(g) The Fund will cooperate with you and with counsel for
the Underwriters in connection with the registration or qualification of the
Shares for offering and sale by the several Underwriters and by dealers under
the state securities or blue sky laws of such jurisdictions as you may
designate and will file such consents to service of process or other documents
necessary or appropriate in order to effect such registration or qualification;
provided, that in no event shall the Fund be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any
action which would subject it to service of process in suits, other than those
arising out of the offering or sale of the Shares, in any jurisdiction where it
is not now so subject.
(h) The Fund will make generally available to its
security holders an earnings statement, which need not be audited, covering a
twelve-month period commencing after the effective date of the Registration
Statement and ending not later than 15 months thereafter, as soon as
practicable after the end of such period, which earnings statement shall
satisfy the provisions of Section 11(a) of the Act and Rule 158 of the 1933 Act
Rules and Regulations.
(i) During the period of five years hereafter, the Fund
will furnish to you (i) as soon as available, a copy of each report of the Fund
mailed to stockholders or filed with the Commission or furnished to the New
York Stock Exchange (the "NYSE") other than reports on Form N-SAR, and (ii)
from time to time such other information concerning the Fund as you may
request.
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(j) If this Agreement shall terminate or shall be
terminated after execution pursuant to any provisions hereof (otherwise than
pursuant to the second paragraph of Section 11 hereof or by notice given by you
terminating this Agreement pursuant to Section 11 or Section 12 hereof) or if
this Agreement shall be terminated by the Underwriters because of any failure
or refusal on the part of the Fund or the Adviser to comply with the terms or
fulfill any of the conditions of this Agreement required to be complied with or
fulfilled by them, the Fund or, in the case of a failure or refusal by the
Fund, the Adviser, agrees to reimburse the Representatives for all
out-of-pocket expenses (including fees and expenses of counsel for the
Underwriters) incurred by you in connection herewith.
(k) The Fund will apply the net proceeds from the sale of
the Shares substantially in accordance with the description set forth in the
Prospectus and in such a manner as to comply with the investment objectives,
policies and restrictions of the Fund as described in the Prospectus.
(l) The Fund will timely file the requisite copies of the
Prospectus with the Commission pursuant to Rule 497(c) or Rule 497(h) of the
1933 Act Rules and Regulations, whichever is applicable or, if applicable, will
timely file the certification permitted by Rule 497(j) of the 1933 Act Rules
and Regulations and will advise you of the time and manner of such filing.
(m) Except as provided in this Agreement, the Fund will
not sell, contract to sell, or otherwise dispose of any senior securities of
the Fund, or grant any options or warrants to purchase senior securities of the
Fund, for a period of 180 days after the date of the Prospectus, without the
prior written consent of Xxxxxxx Xxxxx Xxxxxx Inc.
(n) Except as stated in this Agreement and in the
Prepricing Prospectus and Prospectus, neither the Fund nor the Adviser has
taken, nor will it take, directly or indirectly, any action designed to or that
might reasonably be expected to cause or result in stabilization or
manipulation of the price of any securities issued by the Fund to facilitate
the sale or resale of the Shares; it being understood that the Underwriters
include certain affiliates of the Adviser and that stabilization or other
activity by the Representatives on behalf of the Underwriters shall not be
deemed to be violative of this representation.
(o) The Fund will use its best efforts to have the Shares
listed, subject to notice of issuance, on the NYSE on or before _______ __,
1998.
(p) The Fund will use its best efforts to cause the
Cumulative Preferred Stock, prior to the Closing Date, to be assigned a rating
of 'aaa' by Xxxxx'x Investors Service, Inc. (the "Rating Agency").
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(q) The Fund and the Adviser will use their best efforts
to perform all of the agreements required of them and discharge all conditions
to closing as set forth in this Agreement.
(r) The Fund will furnish to you, on the date on which
delivery is made to the Rating Agency, the Accountant's Confirmation (as
defined in the Articles Supplementary) corresponding to the Basic Maintenance
Report (as defined in the Articles Supplementary) for the first Valuation Date
(as defined in the Articles Supplementary) following the Closing Date.
6. Representations and Warranties of the Fund and the
Adviser. The Fund and the Adviser, jointly and severally, represent and
warrant to each Underwriter that:
(a) Each Prepricing Prospectus included as part of the
registration statement as originally filed or as part of any amendment or
supplement thereto, or filed pursuant to Rule 497 of the 1933 Act Rules and
Regulations, complied when so filed in all material respects with the
provisions of the 1933 Act, the 1940 Act and the Rules and Regulations. The
Commission has not issued any order preventing or suspending the use of any
Prepricing Prospectus.
(b) The registration statement in the form in which it
became or becomes effective and also in such form as it may be when any
post-effective amendment thereto shall become effective and the Prospectus and
any supplement or amendment thereto when filed with the Commission under Rule
497 of the 1933 Act Rules and Regulations and the 1940 Act Notification when
originally filed with the Commission and any amendment or supplement thereto
when filed with the Commission, complied or will comply in all material
respects with the provisions of the 1933 Act, the 1940 Act and the Rules and
Regulations and did not or will not at any such times contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except that this representation and warranty does not apply to statements in or
omissions from the registration statement or the Prospectus made in reliance
upon and in conformity with information relating to any Underwriter furnished
to the Fund in writing by or on behalf of any Underwriter through you expressly
for use therein.
(c) All the outstanding shares of Common Stock of the
Fund have been duly authorized and validly issued, are fully paid and
nonassessable and are free of any preemptive or similar rights; the Shares have
been duly authorized and, when issued and delivered to the Underwriters against
payment therefor in accordance with the terms hereof, will be validly issued,
fully paid and nonassessable and free of any preemptive or similar rights and
will conform to the description thereof in the Registration Statement and the
Prospectus (and any amendment or supplement to either of them); and the capital
stock of the Fund
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conforms to the description thereof in the Registration Statement and the
Prospectus (and any amendment or supplement to either of them).
(d) The Fund is a corporation duly organized and validly
existing in good standing under the laws of the State of Maryland with full
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Registration Statement and the
Prospectus (and any amendment or supplement to either of them), and is duly
registered and qualified to conduct its business and is in good standing in
each jurisdiction or place where the nature of its properties or the conduct of
its business requires such registration or qualification, except where the
failure so to register or qualify does not have a material adverse effect on
the condition (financial or other), business, prospects, properties, net assets
or results of operations of the Fund; and the Fund has no subsidiaries.
(e) There are no legal or governmental proceedings
pending or, to the knowledge of the Fund, threatened, against the Fund, or to
which the Fund or any of its properties is subject, that are required to be
described in the Registration Statement or the Prospectus (and any amendment or
supplement to either of them) but are not described as required, and there are
no agreements, contracts, indentures, leases or other instruments that are
required to be described in the Registration Statement or the Prospectus (and
any amendment or supplement to either of them) or to be filed as an exhibit to
the Registration Statement that are not described or filed as required by the
1933 Act, the 1940 Act or the Rules and Regulations.
(f) The Fund is not in violation of its articles of
incorporation or by-laws, or other organizational documents, or of any law,
ordinance, administrative or governmental rule or regulation applicable to the
Fund or of any decree of the Commission, the NASD, any state securities
commission, any national securities exchange, any arbitrator, any court or
governmental agency, body or official having jurisdiction over the Fund, or in
default in any material respect in the performance of any obligation, agreement
or condition contained in any bond, debenture, note or any other evidence of
indebtedness or in any material agreement, indenture, lease or other instrument
to which the Fund is a party or by which it or any of its properties may be
bound.
(g) Neither the issuance and sale of the Shares, the
execution, delivery or performance of this Agreement or any of the Fund
Agreements by the Fund, nor the consummation by the Fund of the transactions
contemplated hereby or thereby (A) requires any consent, approval,
authorization or other order of or registration or filing with, the Commission,
the NASD, any state securities commission, any national securities exchange,
any arbitrator, any court, regulatory body, administrative agency or other
governmental body, agency or official (except such as may
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have been obtained prior to the date hereof and such as may be required for
compliance with the state securities or blue sky laws of various jurisdictions
which have been or will be effected in accordance with this Agreement) or
conflicts or will conflict with or constitutes or will constitute a breach of,
or a default under, the articles of incorporation, including the Articles
Supplementary, or by-laws, or other organizational documents, of the Fund or
(B) conflicts or will conflict with or constitutes or will constitute a breach
of, or a default under, any agreement, indenture, lease or other instrument to
which the Fund is a party or by which it or any of its properties may be bound,
or violates or will violate any statute, law, regulation or filing or judgment,
injunction, order or decree applicable to the Fund or any of its properties, or
will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Fund pursuant to the terms of any agreement
or instrument to which it is a party or by which it may be bound or to which
any of its property or assets is subject. The Fund is not subject to any order
of any court or of any arbitrator, governmental authority or administrative
agency.
(h) The accountants, Price Waterhouse LLP, who have
certified or shall certify the financial statements included or incorporated by
reference in the Registration Statement and the Prospectus (or any amendment or
supplement to either of them) are independent public accountants as required by
the 1933 Act, the 1940 Act and the Rules and Regulations.
(i) The financial statements, together with related
schedules and notes, included or incorporated by reference in the Registration
Statement and the Prospectus (and any amendment or supplement to either of
them), present fairly the financial position, results of operations and changes
in financial position of the Fund on the basis stated or incorporated by
reference in the Registration Statement at the respective dates or for the
respective periods to which they apply; such statements and related schedules
and notes have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved, except as
disclosed therein; and the other financial and statistical information and data
included in the Registration Statement and the Prospectus (and any amendment or
supplement to either of them) are accurately presented and prepared on a basis
consistent with such financial statements and the books and records of the
Fund.
(j) The execution and delivery of, and the performance by
the Fund of its obligations under, this Agreement and the Fund Agreements have
been duly and validly authorized by the Fund, and this Agreement and the Fund
Agreements have been duly executed and delivered by the Fund and constitute the
valid and legally binding agreements of the Fund, enforceable against the Fund
in accordance with their terms, except as rights to indemnity and contribution
hereunder may be limited by federal or state securities laws.
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(k) Except as disclosed in the Registration Statement and
the Prospectus (or any amendment or supplement to either of them), subsequent
to the respective dates as of which such information is given in the
Registration Statement and the Prospectus (or any amendment or supplement to
either of them), the Fund has not incurred any liability or obligation, direct
or contingent, or entered into any transaction, not in the ordinary course of
business, that is material to the Fund, and there has not been any change in
the capital stock, or material increase in the short-term debt or long-term
debt, of the Fund, or any material adverse change, or any development involving
or which may reasonably be expected to involve, a prospective material adverse
change, in the condition (financial or other), business, prospects, properties,
net assets or results of operations of the Fund, whether or not arising in the
ordinary course of business, it being understood that a change of up to 15% of
the aggregate market value of the Fund's assets shall not cause this
representation to be untrue.
(l) The Fund has not distributed and, prior to the later
to occur of (i) the Closing Date and (ii) completion of the distribution of the
Shares, will not distribute any offering material in connection with the
offering and sale of the Shares other than the Registration Statement, the
Prepricing Prospectus, the Prospectus or other materials, if any, permitted by
the 1933 Act, the 1940 Act or the Rules and Regulations.
(m) The Fund has such permits, licenses, franchises and
authorizations of governmental or regulatory authorities ("permits") as are
necessary to own its properties and to conduct its business in the manner
described in the Prospectus (and any amendment or supplement thereto), subject
to such qualifications as may be set forth in the Prospectus; the Fund has
fulfilled and performed all its material obligations with respect to such
permits and no event has occurred which allows, or after notice or lapse of
time would allow, revocation or termination thereof or results in any other
material impairment of the rights of the Fund under any such permit, subject in
each case to such qualification as may be set forth in the Prospectus (and any
amendment or supplement thereto); and, except as described in the Prospectus
(and any amendment or supplement thereto), none of such permits contains any
restriction that is materially burdensome to the Fund.
(n) The Fund maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific authorization and
with the applicable requirements of the 1940 Act, the 1940 Act Rules and
Regulations and the Internal Revenue Code of 1986, as amended (the "Code");
(ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets and to maintain compliance with the books
and records requirements under the 1940 Act and the 1940 Act Rules and
Regulations; (iii) access
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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.
(o) To the Fund's knowledge, neither the Fund nor any
employee or agent of the Fund has made any payment of funds of the Fund or
received or retained any funds, which payment, receipt or retention of funds is
of a character required to be disclosed in the Prospectus.
(p) The Fund has filed all tax returns required to be
filed, which returns are complete and correct, and the Fund is not in default
in the payment of any taxes which were payable pursuant to said returns or any
assessments with respect thereto.
(q) No holder of any security of the Fund has any right
to require registration of shares of common stock, Cumulative Preferred Stock
or any other security of the Fund because of the filing of the registration
statement or consummation of the transactions contemplated by this Agreement.
(r) The Fund, subject to the registration statement
having been declared effective and the filing of the Prospectus under Rule 497
under the Rules and Regulations, has taken all required action under the 1933
Act, the 1940 Act and the Rules and Regulations to make the public offering and
consummate the sale of the Shares as contemplated by this Agreement.
(s) The conduct by the Fund of its business (as described
in the Prospectus) does not require it to be the owner, possessor or licensee
of any patents, patent licenses, trademarks, service marks or trade names which
it does not own, possess or license.
(t) The Fund is registered under the 1940 Act as a
closed-end non-diversified management investment company and the 1940 Act
Notification has been duly filed with the Commission and, at the time of filing
thereof and any amendment or supplement thereto, conformed in all material
respects with all applicable provisions of the 1940 Act and the Rules and
Regulations. The Fund is, and at all times through the completion of the
transactions contemplated hereby, will be, in compliance in all material
respects with the terms and conditions of the 1933 Act and the 1940 Act. No
person is serving or acting as an officer, director or investment adviser of
the Fund except in accordance with the provisions of the 1940 Act and the 1940
Act Rules and Regulations and the Investment Advisers Act of 1940, as amended
(the "Advisers Act"), and the rules and regulations of the Commission
promulgated under the Advisers Act (the "Advisers Act Rules and Regulations").
(u) Except as stated in this Agreement and in the
Prospectus (and any amendment or supplement thereto), the Fund has not taken,
nor will it take, directly or indirectly, any
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action designed to or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any securities issued by the Fund
to facilitate the sale or resale of the Shares, and the Fund is not aware of
any such action taken or to be taken by any affiliates of the Fund.
(v) The Fund has filed in a timely manner each document
or report required to be filed by it pursuant to the 1934 Act and the rules and
regulations of Commission promulgated thereunder (the "1934 Act Rules and
Regulations"); each such document or report at the time it was filed conformed
to the requirements of the 1934 Act and the 1934 Act Rules and Regulations; and
none of such documents or reports contained an untrue statement of any material
fact or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading.
(w) All advertising, sales literature or other
promotional material (including "prospectus wrappers," "broker kits," "road
show slides" and "road show scripts") authorized in writing by or prepared by
the 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 1933 Act, the 1940 Act, the
Rules and Regulations and the rules and interpretations of the NASD and no such
sales material contained or contains an untrue statement of a material fact or
omitted or omits to state 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.
(x) Each of the Fund Agreements and the Fund's and the
Adviser's obligations under this Agreement and each of the Fund Agreements
comply in all material respects with all applicable provisions of the 1940 Act,
the 1940 Act Rules and Regulations, the Advisers Act the Advisers Act Rules and
Regulations.
(y) At all times since its inception, as required by
Subchapter M of the Code, the Fund has complied with the requirements to
qualify as a regulated investment company under the Code.
(z) Except as disclosed in the Registration Statement and
the Prospectus (or any amendment or supplement to either of them), no director
of the Fund is an "interested person" (as defined in the 1940 Act) of the Fund
or an "affiliated person" (as defined in the 1940 Act) of any Underwriter.
7. Representations and Warranties of the Adviser. The
Adviser represents and warrants to each Underwriter as follows:
(a) The Adviser is a corporation duly organized and
validly existing in good standing under the laws of the State of New York, with
full corporate power and authority to own, lease and operate its properties and
to conduct its business as
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described in the Registration Statement and the Prospectus (and any amendment
or supplement to either of them), and is duly registered and qualified to
conduct its business and is in good standing in each jurisdiction or place
where the nature of its properties or the conduct of its business requires such
registration or qualification, except where the failure so to register or to
qualify does not have a material adverse effect on the condition (financial or
other), business, prospects, properties, net assets or results of operations of
the Adviser and its subsidiaries, taken as a whole, or on the ability of the
Adviser to perform its obligations under this Agreement and the Investment
Advisory Agreement.
(b) The Adviser is duly registered with the Commission as
an investment adviser under the Advisers Act and is not prohibited by the
Advisers Act, the Advisers Act Rules and Regulations, the 1940 Act or the 1940
Act Rules and Regulations from acting under the Investment Advisory Agreement
for the Fund as contemplated by the Prospectus (or any amendment or supplement
thereto). There does not exist any proceeding or any facts or circumstances
the existence of which could lead to any proceeding which might adversely
affect the registration of the Adviser with the Commission.
(c) There are no legal or governmental proceedings
pending or, to the knowledge of the Adviser, threatened against the Adviser, or
to which the Adviser or any of its properties is subject, that are required to
be described in the Registration Statement or the Prospectus (or any amendment
or supplement to either of them) but are not described as required or that may
reasonably be expected to involve a prospective material adverse change, in the
condition (financial or other), business, prospects, properties, net assets or
results of operations of the Adviser and its subsidiaries, taken as a whole, or
on the ability of the Adviser to perform its obligations under this Agreement
and the Investment Advisory Agreement.
(d) Neither the execution, delivery or performance of
this Agreement or the Investment Advisory Agreement by the Adviser, nor the
consummation by the Adviser of the transactions contemplated hereby or thereby
(A) requires the Adviser to obtain any consent, approval, authorization or
other order of or registration or filing with, the Commission, the NASD, any
state securities commission, any national securities exchange, any arbitrator,
any court, regulatory body, administrative agency or other governmental body,
agency or official or conflicts or will conflict with or constitutes or will
constitute a breach of or a default under, the certificate of incorporation or
by-laws, or other organizational documents, of the Adviser or (B) conflicts or
will conflict with or constitutes or will constitute a breach of or a default
under, any agreement, indenture, lease or other instrument to which the Adviser
is a party or by which it or any of its properties may be bound, or violates or
will violate any statute, law, regulation or filing or judgment, injunction,
order or decree applicable to the Adviser or any of its properties or
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will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Adviser pursuant to the terms of any
agreement or instrument to which it is a party or by which it may be bound or
to which any of the property or assets of the Adviser is subject. The Adviser
is not subject to any order of any court or of any arbitrator, governmental
authority or administrative agency.
(e) The execution and delivery of, and the performance by
the Adviser of its obligations under, this Agreement and the Investment
Advisory Agreement have been duly and validly authorized by the Adviser, and
this Agreement and the Investment Advisory Agreement have been duly executed
and delivered by the Adviser and each constitutes the valid and legally binding
agreement of the Adviser, enforceable against the Adviser in accordance with
its terms except as rights to indemnity and contribution hereunder may be
limited by federal or state securities laws.
(f) The Adviser has the financial resources available to
it necessary for the performance of its services and obligations as
contemplated in the Prospectus (or any amendment or supplement thereto) and
under this Agreement and the Investment Advisory Agreement.
(g) The description of the Adviser in the Registration
Statement and the Prospectus (and any amendment or supplement thereto) complied
and comply in all material respects with the provisions the 1933 Act, the 1940
Act, 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 or omit to state 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.
(h) Except as disclosed in the Registration Statement and
the Prospectus (or any amendment or supplement to either of them), subsequent
to the respective dates as of which such information is given in the
Registration Statement and the Prospectus (or any amendment or supplement to
either of them), the Adviser has not incurred any liability or obligation,
direct or contingent, or entered into any transaction, not in the ordinary
course of business, that is material to the Adviser and its subsidiaries, taken
as a whole, and that is required to be disclosed in the Registration Statement
or in the Prospectus and there has not been any material adverse change, or any
development involving or which may reasonably be expected to involve, a
prospective material adverse change, in the condition (financial or other),
business, prospects, properties, net assets or results of operations of the
Adviser and its subsidiaries, taken as a whole, whether or not arising in the
ordinary course of business, or which, in each case, could have a material
adverse effect on the ability of the Adviser to perform its obligations under
this Agreement and the Investment Advisory
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Agreement.
(i) The Adviser has such permits, licenses, franchises
and authorizations of governmental or regulatory authorities ("permits") as are
necessary to own its properties and to conduct its business in the manner
described in the Prospectus (and any amendment thereto); the Adviser has
fulfilled and performed all its material obligations with respect to such
permits and no event has occurred which allows, or after notice or lapse of
time would allow, revocation or termination thereof or results in any other
material impairment of the rights of the Adviser under any such permit; and,
except as described in the Prospectus (and any amendment or supplement
thereto), none of such permits contains any restriction that is materially
burdensome to the Adviser.
(j) Except as stated in this Agreement and in the
Prospectus (and in any amendment or supplement thereto), the Adviser has not
taken, nor will it take, directly or indirectly, any action designed to or
which might reasonably be expected to cause or result in, stabilization or
manipulation of the price of any securities issued by the Fund to facilitate
the sale or resale of the Shares, and the Adviser is not aware of any such
action taken or to be taken by any affiliates of the Adviser; it being
understood that the Underwriters include certain affiliates of the Adviser and
that stabilization or other activity by the Representatives on behalf of the
Underwriters shall not be deemed to be violative of this representation.
(k) Xxxxx X. Xxxxxxx is the validly appointed Chairman,
President, Chief Investment Officer and Director of the Adviser and the
portfolio manager of the Fund; Xx. Xxxxxxx has not given notice nor made known
an intention to give notice of termination of his employment and the Adviser
knows of no reason why Xx. Xxxxxxx should be unable to serve as portfolio
manager to the Fund.
8. Indemnification and Contribution. (a) The Fund and
the Adviser, jointly and severally, agree to indemnify and hold harmless each
of you and each other Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act from and against any and all losses, claims, damages, liabilities
and expenses, joint and several (including reasonable costs of investigation)
arising out of or based upon any untrue statement or alleged untrue statement
of a material fact contained in any Prepricing Prospectus or in the
Registration Statement or the Prospectus or in any amendment or supplement
thereto, or arising out of or based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as such losses,
claims, damages, liabilities or expenses arise out of or are based upon any
untrue statement or omission or alleged untrue statement or omission which has
been made therein or omitted therefrom in reliance upon and in conformity with
the information relating to such Underwriter furnished in
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writing to the Fund by or on behalf of any Underwriter through you expressly
for use in connection therewith; provided, however, that the indemnification
contained in this paragraph (a) with respect to any Prepricing 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 loss, claim, damage,
liability or expense arising from the sale of the Shares by such Underwriter to
any person if a copy of the Prospectus shall not have been delivered or sent to
such person within the time required by the 1933 Act and the 1933 Act Rules and
Regulations, and the untrue statement or alleged untrue statement or omission
or alleged omission of a material fact contained in such Prepricing Prospectus
was corrected in the Prospectus, provided that the Fund has delivered the
Prospectus to the several Underwriters in requisite quantity on a timely basis
to permit such delivery or sending. The foregoing indemnity agreement shall be
in addition to any liability which the Fund or the Adviser may otherwise have.
(b) If any action, suit or proceeding shall be brought
against any Underwriter or any person controlling any Underwriter in respect of
which indemnity may be sought against the Fund or the Adviser, such Underwriter
or such controlling person shall promptly notify the Fund or the Adviser, and
the Fund or the Adviser shall assume the defense thereof, including the
employment of counsel and payment of all fees and expenses. Such Underwriter
or any such controlling person shall have the right to employ separate counsel
in any such action, suit or proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such Underwriter or such controlling person unless (i) the Fund or the Adviser
has agreed in writing to pay such fees and expenses, (ii) the Fund and the
Adviser have failed to assume the defense and employ counsel, or (iii) the
named parties to any such action, suit or proceeding (including any impleaded
parties) include both such Underwriter or such controlling person and the Fund
or the Adviser and such Underwriter or such controlling person shall have been
advised by its counsel that representation of such indemnified party and the
Fund or the Adviser by the same counsel would be inappropriate under applicable
standards of professional conduct (whether or not such representation by the
same counsel has been proposed) due to actual or potential differing interests
between them (in which case the Fund and the Adviser shall not have the right
to assume the defense of such action, suit or proceeding on behalf of such
Underwriter or such controlling person). It is understood, however, that the
Fund and the Adviser shall, in connection with any one such action, suit or
proceeding or separate but substantially similar or related actions, suits or
proceedings in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
only one separate firm of attorneys (in addition to any local counsel) at any
time for all such Underwriters and controlling persons not having actual or
potential differing interests with you or among themselves, which firm shall be
designated in writing by Xxxxxxx Xxxxx Xxxxxx Inc.,
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and that all such fees and expenses shall be reimbursed as they are incurred.
The Fund and the Adviser shall not be liable for any settlement of any such
action, suit or proceeding effected without its written consent, but if settled
with such written consent, or if there be a final judgment for the plaintiff in
any such action, suit or proceeding, the Fund and the Adviser agree to
indemnify and hold harmless any Underwriter, to the extent provided in the
preceding paragraph, and any such controlling person from and against any loss,
claim, damage, liability or expense by reason of such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly,
to indemnify and hold harmless the Fund and the Adviser, their directors, any
officers who sign the Registration Statement, and any person who controls the
Fund or the Adviser within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act, to the same extent as the foregoing indemnity from the Fund
and the Adviser to each Underwriter, but only with respect to information
relating to such Underwriter furnished in writing by or on behalf of such
Underwriter through you expressly for use in the Registration Statement, the
Prospectus or any Prepricing Prospectus, or any amendment or supplement
thereto. If any action, suit or proceeding shall be brought against the Fund
or the Adviser, any of their directors, any such officer, or any such
controlling person based on the Registration Statement, the Prospectus or any
Prepricing Prospectus, or any amendment or supplement thereto, and in respect
of which indemnity may be sought against any Underwriter pursuant to this
paragraph (c), such Underwriter shall have the rights and duties given to the
Fund and the Adviser by paragraph (b) above (except that if the Fund or the
Adviser shall have assumed the defense thereof such Underwriter shall not be
required to do so, but may employ separate counsel therein and participate in
the defense thereof, but the fees and expenses of such counsel shall be at such
Underwriter's expense), and the Fund and the Adviser, their directors, any such
officer, and any such controlling person shall have the rights and duties given
to the Underwriters by paragraph (b) above. The foregoing indemnity agreement
shall be in addition to any liability which the Underwriters may otherwise
have.
(d) If the indemnification provided for in this Section 8
is unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Fund and the Adviser on the one hand (treated jointly for this purpose as
one person) and the Underwriters on the other hand from the offering of the
Shares, or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause
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(i) above but also the relative fault of the Fund and the Adviser on the one
hand (treated jointly for this purpose as one person) and the Underwriters on
the other in connection with the statements or omissions that resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Fund and the
Adviser on the one hand (treated jointly for this purpose as one person) and
the Underwriters on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses) received
by the Fund bear to the total underwriting discounts and commissions received
by the Underwriters, in each case as set forth in the table on the cover page
of the Prospectus. The relative fault of the Fund and the Adviser on the one
hand (treated jointly for this purpose as one person) and the Underwriters on
the other hand shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Fund and the Adviser on the one hand (treated jointly for this purpose as
one person) or by the Underwriters on the other hand and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
(e) The Fund, the Adviser and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 8
were determined by a pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation that does
not take account of the equitable considerations referred to in paragraph (d)
above. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities and expenses referred to in paragraph (d)
above shall be deemed to include, subject to the limitations set forth above,
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 8, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price of the Shares underwritten by it and distributed to the public
exceeds the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to
this Section 8 are several in proportion to the respective numbers of Shares
set forth opposite their names in Schedule I hereto (or such numbers of Shares
increased as set forth in Section 11 hereof) and not joint.
(f) No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any pending
or threatened action, suit or proceeding in
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respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party
from all liability on claims that are the subject matter of such action, suit
or proceeding.
(g) Any losses, claims, damages, liabilities or expenses
for which an indemnified party is entitled to indemnification or contribution
under this Section 8 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 8 and the
representations and warranties of the Fund and the Adviser set forth in this
Agreement shall remain operative and in full force and effect, regardless of
(i) any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter, the Fund, the Adviser, their directors or
officers, or any person controlling the Fund or the Adviser, (ii) acceptance of
any Shares and payment therefor hereunder, and (iii) any termination of this
Agreement. A successor to any Underwriter or any person controlling any
Underwriter, or to the Fund, the Adviser, their directors or officers, or any
person controlling the Fund or the Adviser, shall be entitled to the benefits
of the indemnity, contribution, and reimbursement agreements contained in this
Section 8.
9. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase the Shares hereunder are subject to
the following conditions:
(a) If, at the time this Agreement is executed and
delivered, it is necessary for the registration statement or a post-effective
amendment thereto to be declared effective before the offering of the Shares
may commence, the registration statement or such post-effective amendment shall
have become effective not later than 5:30 P.M., New York City time, on the date
hereof, or at such later date and time as shall be consented to in writing by
you, and all filings, if any, required by Rules 497 and 430A under the 1933 Act
and the 1933 Act Rules and Regulations shall have been timely made; no stop
order suspending the effectiveness of the Registration Statement or order
pursuant to Section 8(e) of the 1940 Act shall have been issued and no
proceeding for those purposes shall have been instituted or, to the knowledge
of the Fund, the Adviser or any Underwriter, threatened by the Commission, and
any request of the Commission for additional information (to be included in the
registration statement or the prospectus or otherwise) shall have been complied
with to your satisfaction.
(b) Subsequent to the effective date of this Agreement,
there shall not have occurred (i) any change (other than a change of up to 15%
of the aggregate market value of the Fund's assets) or any development
involving a prospective change, in or affecting the condition (financial or
other), business,
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prospects, properties, net assets, or results of operations of the Fund or the
Adviser and its subsidiaries, taken as a whole, not contemplated by the
Prospectus, which in your opinion, as Representatives of the several
Underwriters, would materially, adversely affect the market for the Shares, or
(ii) any event or development relating to or involving the Fund or the Adviser
or any officer or director of the Fund or the Adviser which makes any statement
made in the Prospectus untrue or which, in the opinion of the Fund and its
counsel or the Underwriters and their counsel, requires the making of any
addition to or change in the Prospectus in order to state a material fact
required by the 1933 Act, the 1940 Act or the Rules and Regulations or any
other law to be stated therein or necessary in order to make the statements
therein not misleading, if amending or supplementing the Prospectus to reflect
such event or development would, in your opinion, as Representatives of the
several Underwriters, materially adversely affect the market for the Shares.
(c) The Fund shall have furnished to you a report showing
compliance with the asset coverage requirements of the 1940 Act and a Basic
Maintenance Report (as defined in the Articles Supplementary), each dated the
Closing Date and in form and substance satisfactory to you. Each such report
may use portfolio holdings and valuations as of the close of business of the
sixth business day preceding the Closing Date; provided, however, that the Fund
represents in such report that its total net assets as of the Closing Date have
not declined by 5% or more from such valuation date.
(d) You shall have received on the Closing Date, an
opinion of Xxxxxxx, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the Fund,
dated the Closing Date and addressed to you, as Representatives of the several
Underwriters, to the effect that:
(i) The Fund is duly registered and qualified
to conduct its business and is in good standing in the State of New
York (which is the only jurisdiction identified by management of the
Fund to such counsel in which the Fund owns property, has operations
or conducts business);
(ii) The authorized and outstanding capital
stock of the Fund is as set forth under the caption "Capitalization"
in the Prospectus; and the authorized capital stock of the Fund
(including the Cumulative Preferred Stock) conforms in all material
respects as to legal matters to the description thereof contained in
the Prospectus under the captions "Description of Capital Stock and
Other Securities" and "Description of Cumulative Preferred Stock";
(iii) The Shares have been duly authorized and,
when issued and delivered to the Underwriters against payment therefor
in accordance with the terms hereof, will be validly issued, fully
paid and nonassessable;
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(iv) Such counsel has been orally advised that
the Registration Statement has become effective under the 1933 Act
and, to the best knowledge of such counsel after reasonable inquiry,
no stop order suspending the effectiveness of the Registration
Statement or order pursuant to Section 8(e) of the 1940 Act has been
issued and no proceedings for that purpose are pending before or
contemplated by the Commission; and any required filing of the
Prospectus pursuant to Rule 497 has been made in accordance with Rule
497;
(v) Each of this Agreement and the Fund
Agreements has been duly executed and delivered by the Fund and is a
valid, legal and binding agreement of the Fund, enforceable against
the Fund in accordance with its terms, except to the extent that (A)
enforcement hereof and thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally, or (ii)
general principles of equity (regardless of whether enforceability is
considered in a proceeding at law or in equity) and (B) enforcement of
rights to indemnity and contribution hereunder and thereunder may be
limited by Federal or state securities laws or principles of public
policy;
(vi) Neither the offer, sale or delivery of the
Shares, the execution, delivery or performance of this Agreement and
the Fund Agreements by the Fund, compliance by the Fund with the
provisions hereof or thereof nor consummation by the Fund of the
transactions contemplated hereby or thereby conflicts or will conflict
with or constitutes or will constitute a breach of, or a default
under, any contract included as an exhibit to the Registration
Statement (each, a "Material Fund Agreement"), or will result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Fund under any Material Fund Agreement, nor
will any such action result in any violation of (a) any provision of
the New York Business Corporation Law and those laws, rules and
regulations of the State of New York and the United States of America
that, in the experience of such counsel, are normally applicable to
entities such as the Fund and transactions of the type contemplated by
this Agreement, but without having made any special investigation
concerning any other laws, rules or regulations (collectively,
"Applicable Fund Laws"); provided, that the term "Applicable Fund
Laws" does not include (1) the rules and regulations of the NASD, (2)
any federal or state securities or blue sky laws, (3) any antifraud
laws or (4) any law, rule or regulation that may have become
applicable to the Fund as a result of the Underwriters' involvement
with the transactions contemplated hereby or because of any facts
specifically pertaining to the Underwriters, or (b) any judgment,
order or decree of any New York or federal executive, legislative,
judicial, administrative or regulatory body under Applicable Fund Laws
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and the NYSE (each, a "Governmental Fund Authority") identified in an
officer's certificate;
(vii) No consent, approval, license,
authorization, order or validation of, or filing, recording or
registration with, any Governmental Fund Authority pursuant to
Applicable Fund Laws (each, a "Governmental Fund Approval") is
required for the valid issuance and sale of the Shares to the
Underwriters or the execution, delivery and performance by the Fund of
this Agreement and the Fund Agreements or the consummation of the
transactions contemplated hereby and thereby except such Governmental
Fund Approvals as have been obtained;
(viii) The 1940 Act Notification, the
Registration Statement, the Prospectus and the Fund's Registration
Statement on Form 8-A under the 1934 Act and any supplements or
amendments thereto (except for the financial statements and the notes
thereto and the schedules and other financial and statistical data
included therein, as to which such counsel need not express any
opinion) comply as to form in all material respects with the
requirements of the 1933 Act, the 1940 Act, the Rules and Regulations,
the 1934 Act and the rules and regulations promulgated thereunder;
(ix) To the actual knowledge of such counsel
after reasonable inquiry, other than as described or contemplated in
the Registration Statement or Prospectus (or any supplement thereto),
(A) there are no legal or governmental proceedings in the State of New
York or, to the actual knowledge of such counsel, any other state,
pending or threatened against the Fund, or to which the Fund or any of
its properties is subject, which are required to be described in the
Registration Statement or Prospectus (or any amendment or supplement
to either of them) and (B) there are no agreements, contracts,
indentures, leases or other instruments that are required to be
described in the Registration Statement or the Prospectus (or any
amendment or supplement to either of them) or to be filed as an
exhibit to the Registration Statement that are not described or filed
as required, as the case may be;
(x) We have reviewed the proxy statement of the
Fund dated May 12, 1997 and the complaints, answers and other
materials relating to the actions styled Opportunity Partners, X.X. x.
Xxxxxxx Global Multimedia Trust Inc. et al, 97 Civ. 6392 (SDNY), and
Xxxxxx x. Global Multimedia Trust Inc. et al, 97 Civ. ____, (SDNY) and
Xxxxx v. __________ et al, 97 Civ. ____ (SDNY). Even if a court were
to find that the proxy statement at issue in the foregoing actions
misstated or omitted the facts that would be relevant to the issuance
of Cumulative Preferred stock by the Fund and that are claimed by the
plaintiffs to be materially misstated or omitted, we are of the
opinion that a court would not find those misstatements or omissions
to
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be material in an action involving the proxy statement of the Fund
dated May 12, 1997;
(xi) The statements in the Registration
Statement, Prospectus and statement of additional information under
the caption "Taxation", insofar as they refer to statements of law or
legal conclusions, are accurate and present fairly the information
required to be shown;
(xii) Each of the Fund Agreements and the Fund's
and the Adviser's obligations under each of this Agreement and the
Fund Agreements comply as to form in all material respects with all
applicable provisions of the 1933 Act, the 1940 Act, the Advisers Act,
the Rules and Regulations and the Advisers Act Rules and Regulations;
(xiii) The Fund is duly registered with the
Commission under the 1940 Act as a closed-end non-diversified
management investment company; and the provisions of the Fund's
articles of incorporation, including the Articles Supplementary, and
by-laws, and the investment policies and restrictions described in the
Registration Statement and the Prospectus under the captions "The
Fund", "Investment Objectives and Policies", " Special Investment
Methods", "Risk Factors and Special Considerations" and "Investment
Restrictions" (in the Prospectus and the statement of additional
information) comply in all material respects with the requirements of
the 1940 Act, and all action has been taken by the Fund as is required
of the Fund by the 1933 Act and the 1940 Act and the Rules and
Regulations in connection with the issuance and sale of the Shares to
make the public offering and consummate the sale of the Shares as
contemplated by this Agreement;
(xiv) The Fund has all necessary governmental
authorizations, approvals, orders, licenses, certificates, franchises
and permits of and from all governmental regulatory officials and
bodies required under Applicable Fund Law (except where the failure so
to have any such authorizations, approvals, orders, licenses,
certificates, franchises or permits, individually or in the aggregate,
would not have a material adverse effect on the business, properties,
operations or financial condition of the Fund), to own its properties
and to conduct business, as described in the Prospectus;
(xv) Except as described in the Prospectus,
there is no holder of any security of the Fund or any other person who
has the right, contractual or otherwise pursuant to any Material Fund
Agreement, to cause the Fund to sell or otherwise issue to them, or to
permit them to underwrite the sale of, the Shares or the right to have
any securities of the Fund included in the registration statement or
the
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right, as a result of the filing of the registration statement, to
require registration under the 1933 Act of any securities of the Fund;
(xvi) If the Fund operates as described in the
Prospectus, the Fund will qualify as a regulated investment company
under the Code; and
(xvii) Such counsel shall also state that they
have participated in conferences with officers and employees of the
Fund, representatives of the independent accountants for the Fund,
Maryland counsel to the Fund, the Underwriters and counsel for the
Underwriters at which the contents of the Registration Statement and
the Prospectus and related matters were discussed and, although they
are not passing upon, and do not assume any responsibility for, the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus except to the limited extent
otherwise covered by paragraphs (ii), (ix), (x) and (xiii), and have
made no independent check or verification thereof, on the basis of the
foregoing, no facts have come to their attention that would have led
them to believe that the Registration Statement or any amendment or
supplement thereto, at the time it became effective, contained an
untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the statements
contained therein not misleading or that the Prospectus or any
amendment or supplement thereto, as of its issue date and as of the
Closing Date, contained or contains an untrue statement of a material
fact or omitted or omits to state a material fact required to be
stated therein or necessary to make the statements contained therein,
in light of the circumstances under which they were made, not
misleading, except that they express no belief with respect to the
financial statements, schedules and other financial information and
statistical data included therein or excluded therefrom or the
exhibits to the Registration Statement.
(e) You shall have received on the Closing Date, an
opinion of Xxxxx & Stockbridge, Maryland counsel for the Fund, dated the
Closing Date and addressed to you, as Representatives of the several
Underwriters, to the effect that:
(i) The Fund is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Maryland with full corporate power to own, lease and operate its properties
and to conduct its business as described in the Registration Statement and the
Prospectus (and any amendment or supplement to either of them);
(ii) The authorized capital stock of the Fund is
as set forth under the caption "Capitalization" in the Prospectus; and the
authorized capital stock of the Fund conforms
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in all material respects as to legal matters to the description thereof
contained in the Prospectus under the caption "Description of Capital Stock and
Other Securities";
(iii) The Shares have been duly authorized and,
when issued and delivered to the Underwriters against payment therefor in
accordance with the terms hereof, will be validly issued, fully paid and
nonassessable. The issuance of the Shares will not be subject to preemptive or
other similar rights entitling any person to purchase or acquire any of the
Shares upon the issuance thereof by the Fund which arise by operation of the
laws of the State of Maryland or under the articles of incorporation or by-laws
of the Fund;
(iv) The Shares conform in all material respects
to the description thereof contained in the Prospectus under the caption
"Description of Cumulative Preferred Stock";
(v) The form of certificates for the Shares
conforms to the requirements of the Maryland General Corporation Law;
(vi) The Fund has the requisite corporate power
and authority to enter into and execute and deliver this Agreement and to
issue, sell and deliver the Shares to the Underwriters as provided for herein;
(vii) This Agreement has been duly authorized by
the Fund. Neither the offer, sale or delivery of the Shares, the execution,
delivery or performance of this Agreement by the Fund, compliance by the Fund
with the provisions hereof nor consummation by the Fund of the transactions
contemplated hereby conflicts or will conflict with or constitutes or will
constitute a breach of, or a default under, the articles of incorporation,
including the Articles Supplementary, or by-laws of the Fund;
(viii) The Fund has full corporate power and, to
the knowledge of such counsel, all governmental authorizations, approvals,
orders, licenses, certificates, franchises and permits necessary or required
under the laws of the State of Maryland for the Fund to own its properties and
to conduct its business as it now is being conducted as described in the
Prospectus (except in cases where the failure so to have any such
authorizations, approvals, orders, licenses, certificates, franchises or
permits, individually or in the aggregate, would not have a material adverse
effect on the business, properties, operations or financial conditions of the
Fund); and
(ix) No consent, approval, authorization or
other order of, or registration or filing with, any securities commission,
court, regulatory body, administrative agency or other governmental body,
agency, or official of the State of Maryland is required on the part of the
Fund for the valid issuance and sale of the Shares to the Underwriters as
contemplated by this Agreement, the execution and delivery by the
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Fund of this Agreement and the performance by the Fund of its obligations
hereunder or the consummation of the transactions contemplated hereby by the
Fund, except those as may be required under the securities or blue sky laws of
the State of Maryland; it being understood that such counsel do not express any
opinion as to any such consent, approval, authorization or other order of, or
registration or filing, which may be required as a result of the involvement of
any other parties to this Agreement.
(f) You shall have received on the Closing Date an
opinion of Xxxxx X. XxXxx, general counsel for the Fund, dated the Closing Date
and addressed to you, as Representatives of the several Underwriters, to the
effect that:
(i) The Fund is not in violation of its
articles of incorporation, including the Articles Supplementary, or by-laws
and, to the actual knowledge of such counsel after reasonable inquiry, is not
in default in the performance of any material obligation, agreement or
condition in any bond, debenture, note or other evidence of indebtedness,
except as may be disclosed in the Prospectus;
(ii) The Fund is not in violation of any
Material Fund Agreement; and
(iii) To the actual knowledge of such counsel
after reasonable inquiry, the Fund is not in violation of (A) any provision of
the New York Business Corporation Law and those laws, rules and regulations of
the State of New York and the United States of America that, in the experience
of such counsel, are normally applicable to entities such as the Fund and
transactions of the type contemplated by this Agreement, but without having
made any special investigation concerning any other laws, rules or regulations;
provided, that such laws, rules and regulations do not include (1) the rules
and regulations of the NASD, (2) any federal or state securities or blue sky
laws other than the 1933 Act, the 1934 Act and the 1940 Act and the rules and
regulations thereunder to the extent not excluded by item (3) below, (3) any
antifraud laws under the 1933 Act or the 1934 Act as they apply to the
Prospectus and the Registration Statement or (4) any law, rule or regulation
that may have become applicable to the Fund as a result of the Underwriters'
involvement with the transactions contemplated by this Agreement or because of
any facts specifically pertaining to the Underwriters or (B) any order,
judgment or decree of any New York or federal executive, legislative, judicial,
administrative or regulatory body under the laws, rules and regulations
referred to in clause (A) of this paragraph and the NYSE.
(g) You shall have received on the Closing Date an
opinion of Xxxxxxx, Arps, Slate, Xxxxxxx & Xxxx LLP, special counsel for the
Adviser, dated the Closing Date and addressed to you, as Representatives of the
several Underwriters, to the effect that:
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(i) The Adviser is a corporation duly
incorporated and validly existing in good standing under the laws of the State
of New York with full corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Registration
Statement and the Prospectus (and any amendment or supplement to either of
them), it being understood that the opinion with respect to good standing is
based solely upon such counsel's review of a certificate of the Secretary of
State and a telephonic confirmation;
(ii) The Adviser is duly registered with the
Commission as an investment adviser under the Advisers Act and is not
prohibited by the Advisers Act, the Advisers Act Rules and Regulations, the
1940 Act or the 1940 Act Rules and Regulations from acting under the Investment
Advisory Agreement for the Fund as contemplated by the Prospectus (or any
amendment or supplement thereto);
(iii) The Adviser has corporate power and
authority to enter into this Agreement and the Investment Advisory Agreement,
and this Agreement and the Investment Advisory Agreement have been duly
authorized, executed and delivered by the Adviser and each is a valid, legal
and binding agreement of the Adviser, enforceable against the Adviser in
accordance with its terms except to the extent that enforcement hereof and
thereof may be limited by (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally and (ii) general principles of equity (regardless
of whether enforceability is considered in a proceeding at law or in equity);
(iv) Neither the execution, delivery or
performance of this Agreement or the Investment Advisory Agreement by the
Adviser, compliance by the Adviser with the provisions hereof or thereof nor
consummation by the Adviser of the transactions contemplated hereby or thereby
conflicts or will conflict with, or constitutes or will constitute a breach of
or default under, the certificate of incorporation or by-laws, or other
organizational documents, of the Adviser or any contract or agreement to which
the Adviser is a party which has been identified to such counsel by the Adviser
as material or as one which could have an effect on the types of transactions
contemplated by this Agreement (each, an "Material Adviser Agreement"), or will
result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Adviser under any Material Adviser Agreement, nor
will any such action result in any violation of any provision of the New York
Business Corporation Law and those laws, rules and regulations of the State of
New York and the United States of America that, in the experience of such
counsel, are normally applicable to entities such as the Adviser and
transactions of the type contemplated by this Agreement, but without having
made any special investigation concerning any other laws, rules or
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30
regulations (collectively, "Applicable Adviser Laws"); provided, that the term
"Applicable Adviser Laws" does not include (1) the rules and regulations of the
NASD, (2) any federal or state securities or blue sky laws, (3) any antifraud
laws or (4) any law, rule or regulation that may have become applicable to the
Adviser as a result of the Underwriters' involvement with the transactions
contemplated hereby or because of any facts specifically pertaining to the
Underwriters;
(v) No consent, approval, license,
authorization or validation of, or filing, recording or registration with, any
New York or federal executive, legislative, judicial, administrative or
regulatory body under Applicable Adviser Laws (each, a "Governmental Adviser
Approval") is required on the part of the Adviser for the execution, delivery
and performance by it of this Agreement and the Investment Advisory Agreement
to which it is a party or the consummation by it of the transactions
contemplated hereby and thereby except such Governmental Adviser Approvals as
have been obtained;
(vi) To the actual knowledge of such counsel
after reasonable inquiry, there are no legal or governmental proceedings
pending or threatened against the Adviser or to which the Adviser or any of its
properties is subject, which are required to be described in the Registration
Statement or the Prospectus (or any amendment or supplement to either of them)
but are not described as required or which could reasonably be expected to
adversely affect the ability of the Adviser to perform its obligations under
this Agreement or the Investment Advisory Agreement;
(vii) The obligations of the Adviser under this
Agreement and the Investment Advisory Agreement comply in all material respects
with all applicable provisions of the 1940 Act, the 1940 Act Rules and
Regulations, the Advisers Act and the Advisers Act Rules and Regulations;
(viii) The Adviser has full corporate power and
authority, and all necessary governmental authorizations, approvals, orders,
licenses, certificates, franchises and permits of and from all governmental
regulatory officials and bodies required under Applicable Adviser Law (except
where the failure so to have any such authorizations, approvals, orders,
licenses, certificates, franchises or permits, individually or in the
aggregate, would not have a material adverse effect on the business,
properties, operations or financial condition of the Adviser and its
subsidiaries), to own its properties and to conduct its business, including
specifically its business of acting as investment adviser to registered
investment companies and as otherwise described in the Prospectus, and to
perform its obligations under the Investment Advisory Agreement;
(ix) Such counsel shall also state that such
counsel has been advised by the Adviser that it is not registered or
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31
qualified to conduct its business as a foreign corporation in any jurisdiction
and that it believes there is no such jurisdiction where the nature of its
properties or the conduct of its business requires such registration or
qualification and where the failure to register or qualify would have a
material adverse effect on the operations of the Adviser or on the ability of
the Adviser to perform its obligations under this Agreement or the Investment
Advisory Agreement; and
(x) Such counsel shall also state that they have
participated in conferences with officers and employees of the Adviser and the
Fund, representatives of the independent accountants for the Adviser and the
Fund and the Underwriters and counsel for the Underwriters at which the
contents of the Registration Statement and the Prospectus and related matters
were discussed and, although they are not passing upon, and do not assume any
responsibility for, the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus and have made no
independent check or verification thereof, on the basis of the foregoing, no
facts have come to their attention that would have led them to believe that the
Registration Statement or any amendment or supplement thereto, at the time it
became effective, contained an untrue statement of a material fact or omitted
to state any material fact required to be stated therein or necessary to make
the statements contained therein not misleading or that the Prospectus or any
amendment or supplement thereto, as of its issue date and as of the Closing
Date, contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact required to be stated therein or necessary to
make the statements contained therein, in light of the circumstances under
which they were made, not misleading, except that they express no belief with
respect to the financial statements, schedules and other financial information
and statistical data included therein or excluded therefrom or the exhibits to
the Registration Statement.
(h) You shall have received on the Closing Date an
opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for the Underwriters, dated the
Closing Date and addressed to you, as Representatives of the several
Underwriters, with respect to such matters as the Underwriters may reasonably
request.
(i) You shall have received letters addressed to you, as
Representatives of the several Underwriters, and dated the date hereof and the
Closing Date from Price Waterhouse LLP, independent certified public
accountants, substantially in the forms heretofore approved by you.
(j) (i) No order suspending the effectiveness of the
registration statement or the Registration Statement or prohibiting or
suspending the use of the Prospectus (or any amendment or supplement thereto)
or any Prepricing Prospectus or any sales material shall have been issued and
no proceedings for such purpose or for the purpose of commencing an enforcement
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32
action against the Fund, the Adviser or, with respect to the transactions
contemplated by the Prospectus (or any amendment or supplement thereto) and
this Agreement, any Underwriter, may be pending before or, to the knowledge of
the Fund, the Adviser or any Underwriter or in the reasonable view of counsel
to the Underwriters, shall be threatened or contemplated by the Commission at
or prior to the Closing Date and that any request for additional information on
the part of the Commission (to be included in the Registration Statement, the
Prospectus or otherwise) be complied with to the satisfaction of the
Representatives; (ii) there shall not have been any change in the capital stock
of the Fund nor any material increase in the short-term or long-term debt of
the Fund (other than in the ordinary course of business) from that set forth or
contemplated in the Registration Statement or the Prospectus (or any amendment
or Supplement thereto); (iii) there shall not have been, subsequent to the
respective dates as of which information is given in the Registration Statement
and the Prospectus (or any amendment or supplement thereto), except as may
otherwise be stated in the Registration Statement and Prospectus (or any
amendment or supplement thereto), any material adverse change in the condition
(financial or other), business, prospects, properties, net assets or results of
operations of the Fund or the Adviser; (iv) the Fund shall not have any
liabilities or obligations, direct or contingent (whether or not in the
ordinary course of business), that are material to the Fund, other than those
reflected in the Registration Statement or the Prospectus (or any amendment or
supplement to either of them) and other than liabilities for payment for
securities in accordance with the Fund's investment objective and policies; and
(v) all the representations and warranties of the Fund and the Adviser
contained in this Agreement shall be true and correct on and as of the date
hereof and on and as of the Closing Date as if made on and as of the Closing
Date, and you shall have received a certificate, dated the Closing Date and
signed by the chief executive officer and the chief financial officer of each
of the Fund and the Adviser (or such other officers as are acceptable to you),
to the effect set forth in this Section 9(j) and in Section 9(k) hereof.
(k) That neither the Fund nor the Adviser shall have
failed at or prior to the Closing Date to have performed or complied with any
of its agreements herein contained and required to be performed or complied
with by it hereunder at or prior to the Closing Date.
(l) The Fund shall have delivered and you shall have
received evidence satisfactory to you that the shares of Cumulative Preferred
Stock are rated at least 'aaa' by the Rating Agency as of the Closing Date, and
there shall not have been given any notice of any intended or potential
downgrading, or of any review for a potential downgrading, in the rating
accorded to the shares of Cumulative Preferred Stock by the Rating Agency.
(m) In the event that the Underwriters exercise their
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option to purchase all or any portion of the Option Shares, the representations
and warranties of the Fund contained herein and the statements in any
certificates furnished by the Fund or any of its subsidiaries hereunder shall
be true and correct as of each Date of Delivery, and, at the relevant Date of
Delivery, Xxxxxxx Xxxxx Xxxxxx Inc. shall have received:
(i) A certificate, dated such Date of Delivery
of the President and Chief Executive Officer or a Vice President of
the Fund and of the chief financial or chief accounting officer of the
Fund on behalf of the Fund confirming that the certificate delivered
at the Closing Date pursuant to Section 9(n) hereof remains true and
correct as of such Date of Delivery.
(ii) The favorable opinion of Xxxxxxx, Arps,
Slate, Xxxxxxx & Xxxx LLP, counsel for the Fund, in form and substance
reasonably satisfactory to counsel for the Underwriters, dated such
Date of Delivery relating to the Option Shares to be purchased on such
Date of Delivery and otherwise to the same effect as the opinion
required by Section 9(d) hereof.
(iii) The favorable opinion of Xxxxx &
Stockbridge, Maryland counsel for the Fund, in form and substance
reasonably satisfactory to counsel for the Underwriters, dated such
Date of Delivery, relating to the Option Shares and otherwise to the
same extent as the opinion required by Section 9(e) hereof.
(iv) The favorable opinion of Xxxxx X. XxXxx,
general counsel of the Fund, in form and substance reasonably
satisfactory to counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Shares and otherwise to the same
extent as the opinion required by Section 9(f) hereof.
(v) The favorable opinion of Xxxxxxx Xxxxxxx &
Xxxxxxxx, counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Shares to be purchased on such Date of Delivery
and otherwise to the same effect as the opinion required by Section
9(h) hereof.
(vi) A letter from Price Waterhouse LLP, in form
and substance satisfactory to Xxxxxxx Xxxxx Xxxxxx Inc. and dated such
Date of Delivery, substantially the same in scope and substance as the
letter furnished to Xxxxxxx Xxxxx Xxxxxx Inc. pursuant to Section 9(i)
hereof, except that the "specified date" in the letter furnished
pursuant to this Section 9(m)(vi) shall be a date not more than three
days prior to such Date of Delivery.
(n) The Fund and the Adviser shall have furnished or
caused to be furnished to you such further certificates and documents as you
shall have requested.
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All such opinions, certificates, letters and other documents
will be in compliance with the provisions hereof only if they are satisfactory
in form and substance to you and your counsel.
Any certificate or document signed by any officer of the Fund
or the Adviser and delivered to you, as Representatives of the Underwriters, or
to counsel for the Underwriters, shall be deemed a representation and warranty
by the Fund or the Adviser to each Underwriter as to the statements made
therein.
10. Expenses. The Fund agrees to pay the following costs
and expenses and all other costs and expenses incident to the performance by it
of its obligations hereunder: (i) the preparation, printing or reproduction,
and filing with the Commission of the registration statement (including
financial statements and exhibits thereto), each Prepricing Prospectus, the
1940 Act Notification, the Prospectus and each amendment or supplement to any
of them (including, without limitation, the filing fees prescribed by the 1933
Act, the 1940 Act and the Rules and Regulations); (ii) the printing (or
reproduction) and delivery (including postage, air freight charges and charges
for counting and packaging) of such copies of the Registration Statement, each
Prepricing Prospectus, the Prospectus, any sales material and all amendments or
supplements to any of them as may be reasonably requested for use in connection
with the offering and sale of the Shares; (iii) the preparation, printing,
authentication, issuance and delivery of certificates for the Shares, including
any stamp taxes in connection with the original issuance and sale of the
Shares; (iv) the printing (or reproduction) and delivery of this Agreement, any
dealer agreements, the preliminary and supplemental blue sky memoranda and all
other agreements or documents printed (or reproduced) and delivered in
connection with the offering of the Shares; (v) the registration of the Shares
under the Exchange Act and the listing of the Shares on the New York Stock
Exchange; (vi) the registration or qualification of the Shares for offer and
sale under the state securities or blue sky laws of the several states as
provided in Section 5(g) hereof (including the reasonable fees, expenses and
disbursements of counsel for the Underwriters relating to the preparation,
printing or reproduction, and delivery of the preliminary and supplemental blue
sky memoranda and such registration and qualification); (vii) fees paid to the
Rating Agency; (viii) the transportation and other expenses incurred by or on
behalf of Fund representatives in connection with presentations to prospective
purchasers of the Shares; and (ix) the fees and expenses of the Fund's
accountants and the fees and expenses of counsel (including local and special
counsel) for the Fund and of the transfer agent.
Except as provided in this Section 10, the Underwriters agree
to pay their own costs and expenses of the underwriting, including the fees and
expenses of their counsel.
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11. Effective Date of Agreement. This Agreement shall
become effective: (i) upon the execution and delivery hereof by the parties
hereto; or (ii) if, at the time this Agreement is executed and delivered, it is
necessary for the registration statement or a post-effective amendment thereto
to be declared effective before the offering of the Shares may commence, when
notification of the effectiveness of the registration statement or such
post-effective amendment has been released by the Commission. Until such time
as this Agreement shall have become effective, it may be terminated by the
Fund, by notifying you, or by you, as Representatives of the several
Underwriters, by notifying the Fund.
If any one or more of the Underwriters shall fail or refuse to
purchase Shares which it or they are obligated to purchase hereunder on the
Closing Date, and the aggregate number of Shares which such defaulting
Underwriter or Underwriters are obligated but fail or refuse to purchase is not
more than one-tenth of the aggregate number of Shares which the Underwriters
are obligated to purchase on the Closing Date, each non-defaulting Underwriter
shall be obligated, severally, in the proportion which the number of Shares set
forth opposite its name in Schedule I hereto bears to the aggregate number of
Shares set forth opposite the names of all non-defaulting Underwriters or in
such other proportion as you may specify in accordance with Section 20 of the
Master Agreement Among Underwriters of Xxxxxxx Xxxxx Xxxxxx Inc., to purchase
the Shares which such defaulting Underwriter or Underwriters are obligated, but
fail or refuse, to purchase. If any one or more of the Underwriters shall fail
or refuse to purchase Shares which it or they are obligated to purchase on the
Closing Date and the aggregate number of Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Shares which
the Underwriters are obligated to purchase on the Closing Date (or, with
respect to the Underwriters' exercise of any applicable over-allotment option
for the purchase of Option Shares on a Date of Delivery after the Closing Date,
the obligations of the Fund to sell, such Option Shares on such Date of
Delivery) and arrangements satisfactory to you and the Fund for the purchase of
such Shares by one or more non-defaulting Underwriters or other party or
parties approved by you and the Fund are not made within 36 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Fund. In any such case which does not result
in (i) a termination of this Agreement or (ii) in the case of a Date of
Delivery after the Closing Date, a termination of the obligations of the
Underwriters and the Fund with respect to the related Option Shares, as the
case may be, either you or the Fund shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and the Prospectus or
any other documents or arrangements may be effected. Any action taken under
this paragraph shall not relieve any defaulting Underwriter from liability in
respect of any such default of any such Underwriter under this Agreement. The
term "Underwriter" as
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used in this Agreement includes, for all purposes of this Agreement, any party
not listed in Schedule I hereto who, with your approval and the approval of the
Fund, purchases Shares which a defaulting Underwriter is obligated, but fails
or refuses, to purchase.
Any notice under this Section 11 may be given by telegram,
telecopy or telephone but shall be subsequently confirmed by letter.
12. Termination of Agreement. This Agreement shall be
subject to termination in your absolute discretion, without liability on the
part of any Underwriter to the Fund or the Adviser, by notice to the Fund or
the Adviser, if prior to the Closing Date (i) trading in securities generally
on the New York Stock Exchange, the American Stock Exchange or the Nasdaq
National Market shall have been suspended or materially limited, (ii) a general
moratorium on commercial banking activities in New York shall have been
declared by either federal or state authorities, or (iii) there shall have
occurred any outbreak or escalation of hostilities or other international or
domestic calamity, crisis or change in political, financial or economic
conditions, the effect of which on the financial markets of the United States
is such as to make it, in your judgment, impracticable or inadvisable to
commence or continue the offering of the Shares at the offering price to the
public set forth on the cover page of the Prospectus or to enforce contracts
for the resale of the Shares by the Underwriters. Notice of such termination
may be given to the Fund by telegram, telecopy or telephone and shall be
subsequently confirmed by letter.
13. Information Furnished by the Underwriters. The
statements set forth in the last paragraph on the cover page, the stabilization
legend on the inside cover page, and the statements in the first, third and
fifth paragraphs under the caption "Underwriting" in any Prepricing Prospectus
and in the Prospectus, constitute the only information furnished by or on
behalf of the Underwriters through you as such information is referred to in
Sections 6(b) and 8 hereof.
14. Miscellaneous. Except as otherwise provided in
Sections 5, 11 and 12 hereof, notice given pursuant to any provision of this
Agreement shall be in writing and shall be delivered (i) if to the Fund or the
Adviser, at the office of the Fund at Xxx Xxxxxxxxx Xxxxxx, Xxx, Xxx Xxxx
10580-1434, Attention: Xxxxx X. Xxxxxx; or (ii) if to you, as Representatives
of the several Underwriters, care of Xxxxxxx Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Adviser, Investment Banking
Division.
This Agreement has been and is made solely for the benefit of
the several Underwriters, the Fund, the Adviser, their directors and officers,
and the other controlling persons referred to in Section 8 hereof and their
respective successors and assigns, to the extent provided herein, and no other
person
37
37
shall acquire or have any right under or by virtue of this Agreement. Neither
the term "successor" nor the term "successors and assigns" as used in this
Agreement shall include a purchaser from any Underwriter of any of the Shares
in his status as such purchaser.
15. Applicable Law; Counterparts. This Agreement shall
be governed by and construed in accordance with the laws of the State of New
York applicable to contracts made and to be performed within the State of New
York.
This Agreement may be signed in various counterparts which
together constitute one and the same instrument. If signed in counterparts,
this Agreement shall not become effective unless at least one counterpart
hereof shall have been executed and delivered on behalf of each party hereto.
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Please confirm that the foregoing correctly sets forth the
agreement between the Fund and the several Underwriters.
Very truly yours,
THE GABELLI EQUITY
TRUST INC.
By:
GABELLI FUNDS, INC.
By:
Confirmed as of the date first
above mentioned on behalf of
themselves and the other several
Underwriters named in Schedule I
hereto.
XXXXXXX XXXXX XXXXXX INC.
GABELLI & COMPANY, INC.
As Representatives of the
Several Underwriters
By XXXXXXX XXXXX XXXXXX INC.
By:
Managing Director
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SCHEDULE I
THE GABELLI EQUITY TRUST INC.
Underwriter Number of Shares
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