EXHIBIT h.2
[_____________] SHARES
AIM SELECT REAL ESTATE INCOME FUND
AUCTION RATE PREFERRED SHARES
UNDERWRITING AGREEMENT
[________ ___], 2002
Xxxxxxx Xxxxx Xxxxxx Inc.
[Others]
As Representatives of the Several Underwriters
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The undersigned, AIM Select Real Estate Income Fund, a Delaware
business trust (the "Fund"), A I M Advisors, Inc., a Delaware corporation (the
"Investment Adviser"), and INVESCO Institutional (N.A.), Inc., a Delaware
corporation (the "Subadviser", and together with the Investment Adviser, the
"Advisers"), address you as Underwriters and as the representatives (the
"Representatives") of each of the other persons, firms and corporations, if any,
listed in Schedule I hereto (herein collectively called "Underwriters"). The
Fund proposes, upon the terms and conditions set forth herein, to issue and sell
an aggregate of [__________] shares (the "Shares") of its auction rate preferred
shares to the several Underwriters.
The Fund and the Advisers wish to confirm as follows their agreements
with you 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 Master Investment Advisory Agreement with
the Investment Adviser dated May 15, 2002, an exchange traded fund custody
agreement with State Street Bank and Trust Company as of May 1, 2002, which
agreement is dated May 1, 2000, as amended on June 29, 2001 and April 2, 2002, a
shareholder transfer agency agreement with EquiServe Trust Company, N.A. and
EquiServe, Inc. dated May 15, 2002, and an auction agency agreement with _______
to be dated _______, 2002, and such agreements are herein referred to as the
"Management Agreement", the "Custodian Agreement", the "Transfer Agency
Agreement" and the "Auction Agency Agreement", respectively. The Investment
Adviser has entered into an investment sub-advisory agreement with the
Subadviser dated May 15, 2002, and such agreement is herein referred to as the
"Sub-Advisory Agreement". Collectively, the Management Agreement, the
Sub-Advisory Agreement, the Custodian Agreement, the Transfer Agency Agreement
and the Auction Agency Agreement are herein referred to as the "Fund
Agreements". Collectively, the Management Agreement and the Sub-Advisory
Agreement are herein referred to as the "Advisory Agreements". This Underwriting
Agreement is referred to herein as the "Agreement".
1. Registration Statement and Prospectus. The Fund has prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance 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 Commission 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 under the 1933 Act (File No.
333-____) and the 1940 Act (File No. 811-21048) and may pursuant to the Rules
and Regulations prepare and file an additional registration statement relating
to a portion of the Shares pursuant to Rule 462(b) of the 1933 Act Rules and
Regulations (collectively, the "registration statement"), including a prospectus
(including any statement of additional information) relating to the Shares and 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 and includes any information deemed to be included by Rule 430A under
the 1933 Act Rules and Regulations. 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. The term "Prospectus" as used in this Agreement means
the prospectus (including the statement of additional information) in the form
included in the Registration Statement or, if the prospectus (including the
statement of additional information) included in the Registration Statement
omits information in reliance on Rule 430A and such information is included in a
prospectus (including the statement of additional information) filed with the
Commission pursuant to Rule 497(h) under the 1933 Act Rules and Regulations, the
term "Prospectus" as used in this Agreement means the prospectus (including the
statement of additional information) in the form included in the Registration
Statement as supplemented by the addition of the information contained in the
prospectus (including the statement of additional information) filed with the
Commission pursuant to Rule 497(h). The term "Prepricing Prospectus" as used in
this Agreement means the prospectus (including the statement of additional
information) subject to completion in the form included in the registration
statement at the time of the initial filing of the registration statement with
the Commission and as such prospectus (including the statement of additional
information) shall have been amended from time to time prior to the date of the
Prospectus, together with any other prospectus (including any other statement of
additional information) relating to the Fund other than the Prospectus.
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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, Purchase and Compensate. The Fund hereby agrees,
subject to all the terms and conditions set forth herein, to issue and to sell
to each Underwriter and, upon the basis of the representations, warranties and
agreements of the Fund and the Advisers herein contained and subject to all of
the other terms and conditions set forth herein, each Underwriter agrees,
severally and not jointly, to purchase from the Fund at a purchase price per
share of $____ per Share (the "purchase price per 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 10 hereof).
3. Terms of Public Offering . The Fund and the Advisers have been
advised by you that the Underwriters propose to make a public offering of their
respective portions of the Shares as soon after this Agreement has become
effective pursuant to section 10 of this agreement as in your judgment is
advisable and initially to offer the Shares upon the terms set forth in the
Prospectus.
4. Delivery of Shares and Payments Therefor.
(a) Delivery to the Underwriters of and payment to the Fund
for the Shares and compensation of the Underwriters with respect
thereto shall be made at the office of Xxxxxxx Xxxxx Xxxxxx Inc., 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or through the facilities of
the Depository Trust Company or another mutually agreeable facility, at
9:00 A.M., New York City time, on [_________ ___], 2002 (the "Closing
Date"). Payment of the purchase price to the Fund shall be made by wire
transfer of immediately available funds to the Fund's custodian account
as directed to the Underwriters by the officers of the Fund. The place
of closing for the Shares and the Closing Date may be varied by
agreement between you and the Fund.
(b) Certificates for the Shares shall be registered in such
names and in such denominations as you shall request prior to 1:00
P.M., New York City time on the second business day preceding the
Closing Date. Such certificates will be made available to you in New
York City for inspection and packaging not later than 9:00 A.M., New
York City time, on the business day next preceding the Closing Date.
The certificates evidencing the Shares to be purchased hereunder shall
be delivered to you on the Closing Date through the facilities of The
Depository Trust Company, against payment of the purchase price
therefor in immediately available funds to the order of the Fund.
5. Agreements of the Fund and the Advisers. The Fund and the Advisers,
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 use its
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reasonable best efforts to cause the Registration Statement or such
post-effective amendment to become effective under the 1933 Act as soon
as possible. If the Registration Statement has become effective and the
Prospectus contained therein omits certain information at the time of
effectiveness pursuant to Rule 430A of the 1933 Act Rules and
Regulations, the Fund will file a prospectus including such information
pursuant to Rule 497(h) of the 1933 Act Rules and Regulations, as
promptly as practicable, but no later than the second business day
following the earlier of the date of the determination of the offering
price of the Shares or the date the Prospectus is first used after the
effective date of the Registration Statement. If the Registration
Statement has become effective and the Prospectus contained therein
does not so omit such information, the Fund will file a Prospectus
pursuant to Rule 497 (c) or (j) of the 1933 Act Rules and Regulations
as promptly as practicable, but no later than the fifth business day
following the date of the later of the effective date of the
Registration Statement or the commencement of the public offering of
the Shares after the effective date of the Registration Statement. The
Fund will advise you promptly and, if requested by you, will confirm
such advice in writing (i) when the Registration Statement or such
post-effective amendment has become effective, (ii) when the Prospectus
has been timely filed pursuant to Rule 497(c) or Rule 497(h) of the
1933 Act Rules and Regulations or the certification permitted pursuant
to Rule 497(j) of the 1933 Act Rules and Regulations has been timely
filed, whichever is applicable.
(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 of any order 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 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 or, if
known to the Fund, contemplated initiation of any proceeding for any
such purposes, (iii) of receipt by the Fund, the Advisers, any
affiliate of the Fund or the Advisers or any representative or attorney
of the Fund or the Advisers of any other material communication adverse
to the Fund, the Adviser or you 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), assets or results of operations of the
Fund or
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any event which should reasonably be expected to have a material
adverse effect on the ability of either Adviser to perform its
respective obligations under this Agreement and the Advisory Agreements
to which it is a party (in either case, other than as a result of
changes in market conditions generally or the market for securities of
Real Estate Companies (as defined in the Prospectus) generally) or of
the happening of any event which makes any statement of a material fact
made in 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) untrue or which requires the
making of any additions to or changes in the Registration Statement,
the Prospectus or any Prepricing Prospectus (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 the case of a prospectus, 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 or any Prepricing
Prospectus (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 issue 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) (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 use its reasonable best
efforts to obtain the withdrawal of such order at the earliest possible
time.
(c) The Fund will furnish to you, without charge, three signed
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 (except any
post-effective amendment required by Rule 8b-16 of the 1940 Act Rules
and Regulations which is filed with the Commission after the later of
(x) one year from the date of this Agreement and (y) the date on which
the distribution of the Shares is completed) and will also furnish to
you, without charge, such number of conformed copies of the
registration statement as originally filed and of each amendment
thereto (except any post-effective amendment required by Rule 8b-16 of
the 1940 Act Rules and Regulations which is filed with the Commission
after the later of (x) one year from the date of this Agreement and (y)
the date on which the distribution of the Shares is completed), with or
without exhibits, as you may reasonably request.
(d) The Fund will not (i) file any amendment to the
registration statement or make any amendment or supplement to the
Prospectus, any Prepricing Prospectus or any sales material (as
hereinafter defined) (or any amendment or supplement to any of the
foregoing) of which you shall not previously have been advised or to
which you shall reasonably object within a reasonable time after being
so advised or (ii) so long as, in the opinion of counsel for the
Underwriters, a Prospectus is required to be delivered in
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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 reasonably requested, copies of each form of any Prepricing
Prospectus. The Fund consents to the use, in accordance with the
provisions of the 1933 Act and with the 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 of Shares 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
reasonably request. The Fund consents to the use of the Prospectus (and
of any amendments or supplements thereto) in accordance with the
provisions of the 1933 Act and with the 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 or sale of the Shares and for such period
of time thereafter as the Prospectus is required by law to be delivered
in connection with sales of Shares 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 Prospectus (as then amended or
supplemented) or should be set forth therein in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading or if it is necessary to supplement or amend the
Prospectus to comply with the 1933 Act, the 1940 Act, the Rules and
Regulations or any other federal law, rule or regulation, the Fund will
forthwith prepare and, subject to the provisions of paragraph (d)
above, file with the Commission an appropriate amendment or supplement
thereto and will expeditiously furnish to the Underwriters and dealers,
without charge, such number of copies thereof as they shall reasonably
request. In the event that the Prospectus is to be amended or
supplemented, the Fund, if required by law in the opinion of counsel to
the Underwriters or required by any national securities exchange on
which the Common Shares are listed, will promptly issue a press release
announcing or disclosing the matters to be covered by the proposed
amendment or supplement or will otherwise appropriately disseminate the
required information.
(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 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
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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 17 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 1933 Act
and Rule 158 of the 1933 Act Rules and Regulations.
(i) [Reserved].
(j) During the period of three years hereafter, the Fund will
furnish to you (i) as soon as available, a copy of each proxy
statement, annual and semi-annual report of the Fund mailed to
shareholders or filed with the Commission or furnished to the NYSE,
other than reports on Form N-SAR and (ii) from time to time such other
information concerning the Fund as you may reasonably request.
(k) 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 10 hereof or by notice
given by you terminating this Agreement pursuant to Section 10 or
Section 11 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 Advisers to comply with any material term or fulfill any of the
material conditions of this Agreement required to be complied with or
fulfilled by them, the Fund and the Advisers, jointly and severally,
agree to reimburse the Representatives for all out-of-pocket expenses
(including reasonable fees and expenses of counsel for the
Underwriters) incurred by you in connection herewith, but the Fund and
the Advisers shall in no event be liable for any internal cost of the
Underwriters or any loss of anticipated profits or speculative,
consequential or similar damages for such termination.
(l) The Fund will direct the investment of the net proceeds of
the offering of the Shares in such a manner as to comply with the
investment objectives, policies and restrictions of the Fund as
described in the Prospectus, as it may be amended from time to time.
(m) [Reserved].
(n) Except as provided in this Agreement or pursuant to any
dividend reinvestment plan of the Fund in effect on the date hereof,
the Fund will not sell, contract to sell or otherwise dispose of, any
Common Shares or any securities convertible into or exercisable or
exchangeable for Common Shares or grant any options or warrants to
purchase Common Shares, for a period of 180 days after the date of the
Prospectus, without the prior written consent of Xxxxxxx Xxxxx Xxxxxx
Inc.
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(o) Except as stated in this Agreement and in the Prospectus,
neither the Fund nor the Advisers have taken, nor will any of them
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 the Common Shares or any other securities
issued by the Fund to facilitate the sale or resale of the Common
Shares.
(p) [Reserved.]
(q) The Fund will comply with the requirements of Subchapter M
of the Internal Revenue Code of 1986, as amended (the "Code") to
qualify as a regulated investment company under the Code.
(r) The Fund will use its reasonable best efforts to cause the
Shares, prior to the Closing Date, to be assigned a rating of 'Aaa' by
Xxxxx'x Investors Service, Inc. ("Moody's") and either (i) 'AAA' by
Standard & Poor's ("S&P") or (ii) 'AAA' by Fitch IBCA, Inc. ("Fitch",
and together with S&P and Xxxxx'x, the "Rating Agencies").
6. Representations and Warranties of the Fund and the Advisers. The
Fund and the Advisers, jointly and severally, represent and warrant to each
Underwriter that, as of the date hereof or at such other time or times
identified below:
(a) Each Prepricing Prospectus when filed with the Commission
complied in all material respects with the provisions of the 1933 Act,
the 1940 Act and the Rules and Regulations, except that this
representation and warranty does not apply to statements in or
omissions from the Registration Statement or the Prospectus made in
reliance on and in conformity with information relating to any
Underwriter furnished to the Fund in writing by or on behalf of any
Underwriter through you or your counsel expressly for use therein.
(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 amendment or supplement 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 requirements of the
1933 Act, the 1940 Act and the Rules and Regulations, as applicable,
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 (in the case
of the Prospectus, in light of the circumstances under which they were
made) not misleading; except that this representation and warranty does
not apply to statements in or omissions from the Registration Statement
or the Prospectus (or any amendment or supplement thereto) 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 or your counsel expressly for use therein.
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(c) All the Common Shares of the Fund outstanding as of the
date hereof have been duly authorized and validly issued, are fully
paid and, except as described in the Registration Statement and Section
2.10 of the Fund's Declaration of Trust, 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, except as described in the Registration Statement and
Section 2.10 of the Fund's Declaration of Trust, nonassessable and free
of any preemptive or similar rights and the capital stock of the Fund
conforms in all material respects 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 business trust duly organized and validly
existing in good standing as a business trust under the laws of the
State of Delaware, with full business trust 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 to so register or qualify does not have a material,
adverse effect on the condition (financial or other), assets or results
of operations of the Fund. 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 (excluding portfolio securities) 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 and 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 by the 1933 Act, the 1940 Act or the Rules and Regulations.
(f) The Fund is not in violation of its Declaration of Trust
or By-Laws or of any material law, ordinance, administrative or
governmental rule or regulation applicable to the Fund or of any
material decree of 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 having jurisdiction over the Fund
or in breach or default in any 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 agreement,
indenture, lease or other instrument to which the Fund is a party or by
which it or any of its properties (excluding portfolio securities) may
be bound, except where such violation or default does not have a
material adverse effect on the condition (financial or other), assets
or operations of the Fund.
(g) Neither the issuance and sale of the Shares, the
execution, delivery or performance of this Agreement nor any of the
Fund Agreements by the Fund, nor the
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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
national securities exchange, any arbitrator, any court or any other
governmental, regulatory, self-regulatory or administrative agency or
any official having jurisdiction over the Fund (except an order by the
Commission to accelerate the effectiveness of the Registration
Statement and/or any amendments or supplements thereto, such as has
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 and except for compliance with the filing requirements
of the NASD Regulation Inc. Corporate Financing Department) or
conflicts or will conflict with or constitutes or will constitute a
breach of the Declaration of Trust or By-Laws of the Fund or (B)
conflicts or will conflict with or constitutes or will constitute a
breach of or a default under, any material agreement, indenture, lease
or other instrument to which the Fund is a party or by which it or any
of its properties (other than portfolio securities) may be bound or
materially violates or will materially violate any material statute,
law or regulation 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 material 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 the property or assets of the Fund is subject.
(h) Since the date as of which information is given in the
Registration Statement and the Prospectus (and any amendment or
supplement to either of them), except as otherwise stated therein, (A)
there has been no material, adverse change in the condition (financial
or other), assets or results of operations of the Fund or business
prospects (other than as a result of a change in the financial markets
generally or the market for securities of Real Estate Companies) of the
Fund, whether or not arising in the ordinary course of business, (B)
there have been no transactions entered into by the Fund which are
material to the Fund other than those in the ordinary course of its
business as described in the Prospectus (and any amendment or
supplement thereto) and (C) there has been no dividend or distribution
of any kind declared, paid or made by the Fund on its Common Shares.
(i) The accountants, PricewaterhouseCoopers LLP, who have
audited or shall audit the financial statements included or
incorporated by reference in the Registration Statement and the
Prospectus (and 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.
(j) The financial statements, together with related schedules
and notes, included or incorporated by reference in the Registration
Statement or the Prospectus (or any amendment or supplement to either
of them) present fairly the 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
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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
or the Prospectus (or any amendment or supplement thereto) are
accurately presented.
(k) The Fund, subject to the Registration Statement having
been declared effective and the filing of the Prospectus under Rule 497
under the 1933 Act 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.
(l) 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 assuming due authorization, execution and delivery by the
other parties thereto, each constitutes the valid and legally binding
agreement of the Fund, enforceable against the Fund in accordance with
its terms, except as rights to indemnity and contribution hereunder and
thereunder may be limited by federal or state securities laws and
subject to the qualification that the enforceability of the Fund's
obligations hereunder and thereunder may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium and other
laws relating to or affecting creditors' rights generally and by
general equitable principles whether enforcement is considered in a
proceeding in equity or at law.
(m) Except as disclosed in or contemplated by the Registration
Statement and the Prospectus (and 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
(and 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 should reasonably be expected to involve a prospective
material, adverse change in the condition (financial or other),
business, properties, net assets or results of operations of the Fund,
other than as a result of changes in market conditions generally or the
market for securities of Real Estate Companies (as defined in the
Prospectus) generally.
(n) 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 to the public any offering material
in connection with the offering and sale of the Shares other than the
Registration Statement, the Prepricing Prospectus included in
Pre-Effective Amendment No. 1 to the Registration Statement and the
Prospectus.
(o) The Fund has such licenses, permits, and authorizations of
governmental or regulatory authorities ("permits") as are necessary to
own its property and to conduct its business in the manner described in
the Prospectus (and any amendment or supplement
11
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 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 where the revocation, termination or
impairment of the Fund's rights under such permits should not be
reasonably expected to have a material adverse effect on the condition
(financial or other), assets or operations of the Fund; and, except as
described in the Prospectus (and any amendment or supplement thereto),
none of such permits contains any restriction that should reasonably be
expected to have a material adverse effect on the condition (financial
or other), assets or operations of the Fund.
(p) The Fund maintains and will maintain 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 investment policies and
restrictions of the Fund and 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, to calculate net asset
value, to maintain accountability for assets and to maintain material
compliance with the books and records requirements under the 1940 Act
and the 1940 Act Rules and Regulations; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded account for assets is compared
with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(q) The Fund has filed all tax returns required to be filed
and the Fund is not in material default in the payment of any taxes
which were shown as payable on said returns or any assessments with
respect thereto.
(r) 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 (collectively, "Intellectual Property") which it does not
own, possess or license, except where the failure to own, possess or
license such Intellectual Property should not reasonably be expected to
have a material adverse effect on the condition (financial or other),
assets or operations of the Fund.
(s) Except as stated in this Agreement and in the Prospectus
(and any amendment or supplement thereto), the Fund has not taken and
will not take, directly or indirectly, any action designed to or which
should reasonably be expected to cause or result in or which will
constitute stabilization or manipulation of the price of the Common
Shares in violation of federal securities laws and the Fund is not
aware of any such action taken or to be taken by any affiliates of the
Fund who are not underwriters or dealers participating in the offering
of the Shares.
12
(t) The Fund is duly 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 at the time of filing any amendment or
supplement thereto, conformed in all material respects with all
applicable provisions of the 1940 Act and the 1940 Act Rules and
Regulations. The Fund has not received any notice from the Commission
pursuant to Section 8(e) of the 1940 Act with respect to the 1940 Act
Notification or the Registration Statement (or any amendment or
supplement to either of them).
(u) All advertising, sales literature or other promotional
material (including "prospectus wrappers") intended for public
distribution, whether in printed or electronic form, and authorized in
writing by or prepared by the Fund or the Advisers 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 1933 Act Rules and
Regulations and the rules and interpretations of the NASD and, if
required to be filed with the NASD under the NASD's conduct rules, were
so filed; and no such sales material, when read together with the
Prospectus, 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. No
advertising, sales literature or other promotional materials, including
"broker kits", "road show slides" and "road show scripts", not intended
for public distribution and authorized in writing by or prepared by the
Fund or the Advisers for use in connection with the offering and sale
of the Shares was or is, when read together with the Prospectus,
materially false or misleading.
(v) Each of the Fund Agreements complies in all material
respects with all applicable provisions of the 1940 Act, the 1940 Act
Rules and Regulations, the Investment Advisers Act of 1940, as amended
(the "Advisers Act") and the rules and regulations adopted by the
Commission under the Advisers Act (the "Advisers Act Rules and
Regulations").
(w) No holder of any security of the Fund has any right to
require registration of Common Shares or any other security of the Fund
because of the filing of the registration statement or consummation of
the transactions contemplated by this Agreement.
(x) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement to either of them), no
trustee of the Fund is an "interested person" (as defined in the 0000
Xxx) of the Fund or an "affiliated person" (as defined in the 0000 Xxx)
of any Underwriter listed in Schedule I hereto.
7. Representations and Warranties of the Advisers. Each of the
Investment Adviser and the Subadviser, severally as to itself only and not
jointly or as to any other party, represent and warrant to each Underwriter
that, as of the date hereof or at such other time or times identified below:
13
(a) Such Adviser is a corporation duly organized and validly
existing in good standing under the laws of Delaware. Such Adviser has
full 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 business and is in good
standing in each jurisdiction or place where the nature of its
properties or conduct of its business requires such registration or
qualification, except where the failure so to register or to qualify
would not have a material, adverse effect on the condition (financial
or other), business, properties, net assets or results of operations of
such Adviser.
(b) Such Adviser is duly registered as an investment adviser
under the Advisers Act and is not prohibited by the Advisers Act, the
1940 Act, the Advisers Act Rules and Regulations or the 1940 Act Rules
and Regulations from acting under the Fund Agreements to which it is a
party for the Fund as contemplated by the Registration Statement and
the Prospectus (or any amendment or supplement thereto).
(c) Such Adviser has full corporate power and authority under
Delaware law to enter into this Agreement and the Advisory Agreements
to which it is a party; the execution and delivery of, and the
performance by such Adviser of its obligations under, this Agreement
and the Advisory Agreements to which it is a party have been duly and
validly authorized by such Adviser; and this Agreement and the Advisory
Agreements to which it is a party have been duly executed and delivered
by such Adviser and, assuming the due authorization, execution and
delivery by the other parties thereto, constitute the valid and legally
binding agreements of such Adviser, enforceable against such Adviser in
accordance with their terms, except as rights to indemnity and
contribution hereunder may be limited by federal or state securities
laws and subject to the qualification that the enforceability of such
Adviser's obligations hereunder and thereunder may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium and other laws relating to or affecting creditors' rights
generally and by general equitable principles, whether enforcement is
considered in a proceeding in equity or at law.
(d) Such Adviser has the financial resources necessary for the
performance of its services and obligations as contemplated in the
Registration Statement and the Prospectus (or any amendment or
supplement thereto) and under this Agreement and the Advisory
Agreements to which it is a party.
(e) The description of such Adviser and its business, and the
statements attributable to such Adviser, in the Registration Statement
and the Prospectus (and any amendment or supplement thereto) complied
and comply in all material respects with the provisions of 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 the case of a prospectus, in light of the circumstances
under which they were made) not misleading.
14
(f) There are no legal or governmental proceedings pending or,
to the knowledge of such Adviser, threatened against such Adviser 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 reasonably should be expected to have a
material, adverse effect on the ability of such Adviser to perform its
obligations hereunder or under the Advisory Agreement to which it is a
party.
(g) Since the date as of which information is given in the
Registration Statement and the Prospectus (and any amendment or
supplement to either of them), except as otherwise stated therein,
there has not occurred any event which should reasonably be expected to
have a material adverse effect on the ability of such Adviser to
perform its obligations under this Agreement and the Advisory Agreement
to which it is a party..
(h) Such Adviser has such licenses, permits and authorizations
of governmental or regulatory authorities ("permits") as are necessary
to own its property and to conduct its business in the manner described
in the Prospectus and any amendment or supplement thereto, except to
the extent that the failure to so have should not reasonably be
expected to have a material adverse effect on the ability of such
Adviser to perform its obligations under this Agreement or the Advisory
Agreement to which it is a party; such Adviser has fulfilled and
performed all its 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
impairment of the rights of such Adviser under any such permit, except
where the revocation, termination or impairment of such Adviser's
rights under such permits should not reasonably be expected to have a
material adverse effect on the ability of such Adviser to perform its
obligations under this Agreement or the Advisory Agreement to which it
is a party.
(i) This Agreement and each of the Management Agreement and
the Sub-Advisory Agreement to which such Adviser is a party 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.
(j) Neither the execution, delivery or performance by such
Adviser of this Agreement or the Advisory Agreement to which such
Adviser is a party, nor the consummation by such Adviser of the
transactions contemplated hereby or thereby (A) requires receipt by the
Advisers of 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 or any other governmental, regulatory,
self-regulatory or administrative agency or any official having
jurisdiction over such Adviser (except compliance with the securities
or Blue Sky laws of various jurisdictions which have been or will be
effected in accordance with this Agreement and except for compliance
with the filing requirements of the NASD Regulation Inc. Corporate
Financing Department) or conflicts or will conflict with or constitutes
or will constitute a breach of or a default under, the articles of
incorporation, by-laws or other organizational documents, as
applicable, of such Adviser or (B) conflicts or will conflict with or
constitutes or will constitute a breach of or a default under, any
agreement,
15
indenture, lease or other instrument to which such 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 such Adviser 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 such 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 such Adviser is subject, except in any case under clause (A)
or (B) as should not reasonably be expected to have a material adverse
effect on the ability of such Adviser to perform its obligations under
this Agreement and the Advisory Agreement to which it is a party.
(k) Except as stated in this Agreement and in the Prospectus
(and in any amendment or supplement thereto), such Adviser has not
taken nor will it take, directly or indirectly, any action designed to
or which should reasonably be expected to cause or result in or which
will constitute stabilization or manipulation of the price of the
Common Shares in violation of federal securities laws and such Adviser
is not aware of any such action taken or to be taken by any affiliates
of such Adviser who are not underwriters or dealers participating in
the offering of the shares.
(l) In the event that the Fund or such Adviser makes available
any promotional materials intended for use only by qualified
broker-dealers and registered representatives thereof by means of an
Internet web site or similar electronic means, such Adviser will
install and maintain pre-qualification and password-protection or
similar procedures which are reasonably designed to effectively
prohibit access to such promotional materials by persons other than
qualified broker-dealers and registered representatives thereof.
8. Indemnification and Contribution.
(a) The Fund and the Advisers, 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 or 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 the Registration Statement, the
Prospectus, any Prepricing Prospectus, any sales material (or any
amendment or supplement to any of the foregoing) 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 (in the case of a prospectus, in light of the circumstances
under which they were made) 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 that has been made therein or omitted therefrom in reliance
upon and in conformity with the information relating to such
Underwriters furnished in writing to the Fund by or on behalf of any
Underwriter through you or your counsel expressly for use in connection
therewith; provided, however, that the foregoing indemnity with respect
to the Registration
16
Statement, the Prospectus or any Prepricing Prospectuses (or any
amendment or supplement to any of the foregoing) 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 shares by such Underwriter to any
person, if a copy of the Prospectus, as then amended or supplemented,
which would have cured any defect giving rise to such loss, claim,
damage, liability or expense was not sent or delivered to such person
by or on behalf of such Underwriter, if required by law to be so
delivered, at or prior to the confirmation of the sale of such Shares
to such person and such Prospectus, amendments and supplements had been
provided by the Fund to the Underwriters in requisite quantity and 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 Advisers 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 Advisers, such
Underwriter or such controlling person shall promptly notify the Fund
or the Advisers and the Fund or the Advisers shall assume the defense
thereof, including the employment of counsel and the 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 controlling person unless (i) the Fund or the Advisers
have agreed in writing to pay such fees and expenses, (ii) the Fund and
the Advisers have failed within a reasonable time 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 Advisers 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 Advisers 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 Advisers 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
Advisers 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 if there is any action, suit or proceeding in more than
one jurisdiction) 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. and that, subject to the requirements of 1940 Act
Release No. 11330, all such fees and expenses shall be reimbursed
promptly as they are incurred. The Fund and the Advisers shall not be
liable for any settlement of any such action, suit or proceeding
effected without the written consent of the Fund or the Advisers, but
if settled with such written consent or if there be a final judgment
for the
17
plaintiff in any such action, suit or proceeding, the Fund and the
Advisers 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, liability, damage or expense by
reason by such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Fund and the Advisers, their trustees,
their directors, any officers of the Fund who sign the Registration
Statement and any person who controls the Fund or the Advisers 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 Advisers 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 or your counsel expressly for use in the
Registration Statement, Prospectus, any Prepricing Prospectus, or any
amendment or supplement thereto. If any action, suit or proceeding
shall be brought against the Fund or the Advisers, any of their
trustees, their directors, any such officer or any such controlling
person, based on the Registration Statement, the Prospectus, 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 by paragraph (b) above (except that if the
Fund or the Advisers 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 Advisers, their trustees, 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 Advisers 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 (i) above
but also the relative fault of the Fund and the Advisers on the one
hand (treated jointly for this purpose as one person) and of the
Underwriters on the other hand 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 Advisers on the one hand
(treated jointly for this purpose as one person) and the Underwriters
on the other hand shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses)
received by the Fund as set forth in the table on the cover page of the
Prospectus bear to
18
the total underwriting discounts and commissions received by the
Underwriters with respect to the Shares as set forth in the table on
the cover page of the Prospectus. The relative fault of the Fund and
the Advisers on the one hand (treated jointly for this purpose as one
person) and of 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 Advisers 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 Advisers and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this
Section 8 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any
other method of allocation that does not take account of the equitable
considerations referred to in 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 0000 Xxx) 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 number of
Shares set forth opposite their names in Schedule I (or such numbers of
Shares increased as set forth in Section 10 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 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 from claimants 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, subject, with regard to the Fund,
to 1940 Act Release No. 11330. The indemnity and contribution
agreements contained in this Section 8 and the representations and
warranties of the Fund and the Advisers 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
19
Underwriter, the Fund, the Advisers or their trustees, directors or
officers or any person controlling the Fund or the Advisers, (ii)
acceptance of any Shares and payment therefor hereunder and (iii) any
termination of this Agreement. A successor to any Underwriter or to the
Fund, the Advisers or their trustees, directors or officers or any
person controlling any Underwriter, the Fund or the Advisers shall be
entitled to the benefits of the indemnity, contribution and
reimbursement agreements contained in this Section 8.
(h) Nothing in this Section 8 shall be construed to require or
permit indemnification by the Fund for any liability of any
Underwriter, whether or not there is an adjudication of liability,
arising by reason of such Underwriter's willful misfeasance, bad faith,
gross negligence, or reckless disregard of its duties under this
Agreement ("disabling conduct"), where such indemnification would be in
contravention of Section 17(i) of the 1940 Act or 1940 Act Release No.
11330. Subject to the foregoing, the Fund shall only indemnify an
Underwriter based on: (1) a final decision on the merits by a court or
other body before whom the proceeding was brought that the Underwriter
was not liable by reason of disabling conduct; or (2) in the absence of
such a decision, a reasonable determination, based upon a review of the
facts, that the Underwriter is not liable by reason of disabling
conduct, by (i) the vote of a majority of a quorum of the Fund's
trustees who are neither "interested persons" of the Fund as defined in
Section 2(a)(19) of the 1940 Act nor parties to the proceeding, or (ii)
an independent legal counsel in a written opinion.
9. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase any Shares hereunder are subject to the accuracy of
and compliance with the representations, warranties and agreements of and by the
Fund and the Advisers contained herein on and as of the date hereof, the date on
which the Registration Statement becomes or became effective, the date of the
Prospectus (and of any amendment or supplement thereto), the Closing Date; to
the accuracy and completeness of all statements made by the Fund, the Advisers
or any of their officers in any certificate delivered to the Representatives or
their counsel pursuant to this Agreement and 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 Rules and Regulations
shall have been timely made; no order suspending the effectiveness of
the Registration Statement shall have been issued and no proceeding for
that purpose shall have been instituted or, to the knowledge of the
Fund, the Advisers 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.
20
(b) You shall have received on the Closing Date an opinion of
Xxxxxxx Xxxxx Xxxxxxx & Xxxxxxxxx, 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 a business trust duly organized,
validly existing and in good standing under the laws of the
State of Delaware with full 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 thereto through the date of
the opinion) and is duly registered and qualified to conduct
its business and is in good standing in Delaware and Texas;
except where the failure so to register or to qualify does not
have a material, adverse effect on the condition (financial or
other), business, properties, net assets or results of
operations of the Fund;
(ii) The authorized and outstanding shares of
beneficial interest of the Fund are as set forth in the
Registration Statement and Prospectus (or any amendment or
supplement thereto through the date of the opinion); and the
description of the authorized shares of beneficial interest of
the Fund contained in the Prospectus (or any amendment or
supplement thereto through the date of the opinion) under the
caption "Description of Shares" conforms in all material
respects as to legal matters to the terms thereof contained in
the Fund's Declaration of Trust;
(iii) All the shares of beneficial interest of the
Fund outstanding prior to the issuance of the Shares have been
duly authorized and legally issued and are fully paid and
nonassessable except that, as described in the Prospectus
under "Certain Provisions in the Declaration of Trust,"
shareholders of the Fund may be held personally liable for its
obligations;
(iv) The Shares have been duly authorized and, when
issued and delivered to the Underwriters against payment
therefor in accordance with the Fund's Declaration of Trust,
the Registration Statement and the terms hereof, and, if
certificated, when such certificates are duly executed,
countersigned, registered and delivered upon payment of the
agreed-upon consideration will be legally issued, fully paid
and nonassessable except that, as described in the Prospectus
under "Certain Provisions in the Declaration of Trust,"
shareholders of the Fund may be held personally liable for its
obligations, and are not subject to any preemptive rights that
entitle or will entitle any person to acquire any Shares upon
the issuance thereof by the Fund;
(v) The form of certificates for the Shares is in due
and proper form;
(vi) The Fund has the power and authority under the
Delaware Business Trust Act to enter into this Agreement and
the Fund Agreements and to issue, sell and deliver the Shares
to the Underwriters as provided herein and this Agreement and
each of the Fund Agreements have been duly authorized,
executed
21
and delivered by the Fund and assuming due authorization,
execution and delivery by, and binding effect on, the other
parties thereto, constitute the valid, legal and binding
agreements of the Fund, enforceable against the Fund in
accordance with their terms, assuming the Agreement and Fund
Agreements were governed by Pennsylvania law, except as
enforcement of rights to indemnity hereunder may be limited by
Federal or state securities laws or principles of public
policy and subject to the qualification that the
enforceability of the Fund's obligations hereunder and
thereunder may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or
affecting creditors' rights generally and by general equitable
principles, whether enforcement is considered in a proceeding
in equity or at law;
(vii) The Management Agreement and Sub-Advisory
Agreement comply in all material respects with all applicable
provisions of the 1940 Act, the Advisers Act, the 1940 Act
Rules and Regulations and the Advisers Act Rules and
Regulations and the Custodian Agreement complies as to form in
all material respects with all applicable provisions of the
1940 Act and 1940 Act Rules and Regulations;
(viii) The Fund is not in violation of its
Declaration of Trust or By-Laws or to the knowledge of
counsel's attorneys who have worked on this transaction after
reasonable inquiry, is not in material default in the
performance of any material obligation, agreement or condition
contained in any bond, debenture, note or other evidence of
indebtedness, which material obligation, agreement or
condition is set forth as an exhibit to the Registration
Statement (or any amendment thereto through the date of this
opinion), except as may be disclosed in the Prospectus (and
any amendment or supplement thereto);
(ix) No consent, approval, authorization or order of
or registration or filing with the Commission, any national
securities exchange, any arbitrator, any court or any other
governmental body, agency or regulatory, self-regulatory or
administrative agency or any official is required on the part
of the Fund (except as have been obtained under the 1933 Act
and the 1934 Act or such as may be required under state
securities or Blue Sky laws governing the purchase and
distribution of the Shares) for the valid issuance and sale of
the Shares to the Underwriters as contemplated by this
Agreement, performance of the Fund Agreements or this
Agreement by the Fund, the consummation by the Fund of the
transactions contemplated thereby or hereby or the adoption of
the Fund's Dividend Reinvestment Plan;
(x) Neither the offer, sale or delivery of the
Shares, the execution, delivery or performance of this
Agreement or the Fund Agreements, compliance by the Fund with
the provisions hereof or thereof, consummation by the Fund of
the transactions contemplated hereby or thereby nor the
adoption of the Fund's Dividend Reinvestment Plan violates the
Declaration of Trust or By-Laws of the Fund or any material
agreement, indenture, lease or other instrument to which the
22
Fund is a party or by which it or any of its properties is
bound that is an exhibit to the Registration Statement or
described therein, will result in the creation or imposition
of any material lien, charge or encumbrance upon any property
or assets of the Fund under any such agreement nor, to the
knowledge of counsel's attorneys who have worked on this
transaction after reasonable inquiry, will any such action
result in any material violation of any existing material law,
regulation, ruling (assuming compliance with all applicable
state securities and Blue Sky laws), judgment, injunction,
order or decree known to such attorneys or counsel after
reasonable inquiry, applicable to the Fund or any of its
properties (other than the Fund's portfolio securities),
except that no opinion is given with respect to any
indemnification provisions in this Agreement or the Fund
Agreements insofar as they relate to indemnification for
liabilities arising under the 1933 Act;
(xi) The Registration Statement and all
post-effective amendments, if any, have become effective under
the 1933 Act and, to the knowledge of counsel's attorneys who
have worked on this transaction after reasonable inquiry, no
order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose
are pending before or contemplated by the Commission; and any
filing of the Prospectus and any amendments or supplements
thereto required pursuant to Rule 497 of the 1933 Act Rules
and Regulations prior to the date of such opinion have been
made in accordance with Rule 497;
(xii) The Fund is duly registered with the Commission
under the 1940 Act as a closed-end, non-diversified management
investment company and all action has been taken by the Fund
as required 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;
(xiii) The statements in the Registration Statement
and Prospectus (and any amendment or supplement to either of
them through the date of the opinion) under the caption "Tax
Matters" have been reviewed by such counsel and to the extent
they describe or summarize tax laws, doctrines or practices of
the United States, present a fair and accurate description or
summary of the information purported to be shown as of the
date of the opinion;
(xiv) The statements made under the captions
"Management of the Fund", "Description of Shares" and "Certain
Provisions of the Declaration of Trust" in the Prospectus (and
any amendment or supplement thereto through the date of the
opinion) and "Management of the Fund" and "Certain Provisions
of the Declaration of Trust and Bylaws" in the statement of
additional information incorporated by reference in the
Prospectus (and any amendment or supplement thereto through
the date of the opinion) insofar as they are descriptions of
contracts, agreements or other legal documents or refer to
statements of law or
23
legal conclusions, are accurate and present fairly the
information purported to be shown;
(xv) The Registration Statement and the Prospectus
(and any amendment or supplement to either of them through the
date of the opinion) comply as to form in all material
respects with the requirements of the 1933 Act, the 1940 Act
and the Rules and Regulations (except that no opinion need be
expressed as to 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); and
(xvi) If the Fund operates as described in the
Prospectus, the Fund will qualify as a regulated investment
company under the Code.
The opinion shall also include the following statements:
1) Such counsel shall confirm that it has no
knowledge of (a) any actions, suits or other legal or
governmental proceedings pending or threatened against the
Fund, or to which the Fund or any of its properties is
subject, or (b) any 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 thereto) or to be filed as an exhibit to the
Registration Statement that are not described or filed as
required, as the case may be.
2) Both the Delaware Business Trust Act and the
Declaration of Trust provide that shareholders of the Trust
shall be entitled to the same limitation on personal liability
as is extended under the Delaware General Corporation Law to
stockholders of private corporations for profit. There is a
remote possibility, however, that, under certain
circumstances, shareholders of a Delaware business trust may
be held personally liable for that trust's obligations to the
extent that the courts of another state which does not
recognize such limited liability were to apply the laws of
such state to a controversy involving such obligations. The
Trust Agreement also provides for indemnification out of
property of a Fund for all loss and expense of any shareholder
held personally liable for the obligations of that Fund.
Therefore, the risk of any shareholder incurring financial
loss beyond his investment due to shareholder liability is
limited to circumstances in which a Fund is unable to meet its
obligations and the express limitation of shareholder
liabilities is determined not to be effective.
Such counsel shall also state that although counsel has not
undertaken, except as otherwise indicated in their opinion, to
determine independently and does not assume any responsibility for, the
accuracy or completeness of the statements in the Registration
Statement, such counsel has participated in the preparation of the
Registration Statement and the Prospectus, including review and
discussion of the contents thereof, and nothing has come to the
attention of such counsel that has caused it to believe that the
Registration Statement, at the time the Registration Statement became
effective or the Prospectus, as of
24
its date and as of the Closing Date, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein (in the case of a
prospectus, in light of the circumstances under which they were made)
not misleading or that any amendment or supplement to the Prospectus,
as of the Closing Date, contained an untrue statement of a material
fact or omitted to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading (it being understood that such counsel need
express no view with respect to the financial statements and the notes
thereto and the schedules and other financial and statistical data
included in the Registration Statement or the Prospectus).
In rendering such opinion, such counsel may limit such opinion
to matters involving the application of the laws of the State of
Delaware and the United States and may rely upon an opinion or
opinions, each dated the Closing Date, of other counsel retained by the
Fund as to laws of any jurisdiction, including the State of Delaware,
provided that (X) each such local counsel is acceptable to the
Representatives, (Y) such reliance is expressly authorized by each
opinion so relied upon and a copy of each such opinion is delivered to
the Representatives and is, in form and substance satisfactory to them
and their counsel and (Z) counsel shall state in their view that they
believe that they and the Underwriters are justified in relying
thereon.
(c) You shall have received on the Closing Date an opinion of
Xxxxx X. Xxxxxxx, Senior Vice President, General Counsel and Secretary
of the Investment Adviser, dated the Closing Date and addressed to you,
as Representatives of the several Underwriters, to the effect that:
(i) Based on certificates of the Secretary of State
of the State of Delaware, the Investment Adviser is a
corporation duly incorporated and validly existing in good
standing under the laws of Delaware with all necessary
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 based on certificates of
the applicable secretaries of state, the Investment Adviser 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 ability of the Investment Adviser to
perform its obligations under this Agreement and the Advisory
Agreement to which it is a party;
(ii) The Investment Adviser is duly registered with
the Commission under the Advisers Act as an investment adviser
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 for the Fund under the Management
Agreement as contemplated by the Prospectus (and any amendment
or supplement thereto);
25
(iii) The Investment Adviser has the power and
authority to enter into this Agreement, the Management
Agreement and the Sub-Advisory Agreement and this Agreement,
the Management Agreement and the Sub-Advisory Agreement have
been duly authorized, executed and delivered by the Investment
Adviser and each of the Management Agreement and the
Sub-Advisory Agreement is a valid, legal and binding agreement
of the Investment Adviser, enforceable against the Investment
Adviser in accordance with its terms, except as enforcement of
rights to indemnity and contribution hereunder may be limited
by Federal or state securities laws or principles of public
policy and subject to the qualification that the
enforceability of the Investment Adviser's obligations
hereunder and thereunder may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium
and other laws relating to or affecting creditors' rights
generally and by general equitable principles whether
enforcement is considered in a proceeding in equity or at law;
(iv) Neither the execution and delivery by the
Investment Adviser of this Agreement, the Management Agreement
or the Sub-Advisory Agreement nor the consummation by the
Investment Adviser of the transactions contemplated hereunder
or thereunder constitutes or will constitute a breach of or a
default under the articles of incorporation, by-laws or other
organizational documents of the Investment Adviser or any
material agreement, indenture, lease or other instrument to
which the Investment Adviser is a party that is known to such
counsel after reasonable inquiry, or will result in the
creation or imposition of any material lien, charge or
encumbrance upon any material property or material assets of
the Investment Adviser, nor will any such action result in any
material violation of any law of the State of Texas, the
Delaware General Corporation Law, the 1940 Act, the Advisers
Act or regulation, ruling (assuming compliance with all
applicable state securities and Blue Sky laws), judgment,
injunction, order or decree known to such counsel after
reasonable inquiry, applicable to the Investment Adviser or
any of its properties;
(v) The Investment Adviser owns, possesses or has
obtained and currently maintains all governmental licenses,
permits, consents, orders, approvals and other authorizations
as are necessary for the Investment Adviser to carry on its
business as described in the Prospectus (and any amendment or
supplement thereto); and
(vi) No material consent, approval, authorization or
order of or registration or filing with any court, regulatory
body, administrative or other governmental body, agency or
official is required on the part of the Investment Adviser for
the performance of this Agreement, the Management Agreement or
the Sub-Advisory Agreement by the Investment Adviser or for
the consummation by the Investment Adviser of the transactions
contemplated hereby or thereby.
The opinion shall also include the following statement:
26
Such counsel shall confirm that it has no knowledge
of any actions, suits or other legal or governmental
proceedings pending or threatened against the Investment
Adviser, or to which the Investment 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 thereto) that are not described as required.
Such counsel shall also state that although counsel has not
undertaken, except as otherwise indicated in its opinion, to determine
independently and does not assume any responsibility for, the accuracy
or completeness of the statements in the Registration Statement, such
counsel has participated in the preparation of the Registration
Statement and the Prospectus, including review and discussion of the
contents thereof and nothing has come to its attention that has caused
it to believe that the Registration Statement at the time it became
effective or the Prospectus, as of its date and as of the Closing Date,
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein (in the case of a prospectus, in light of the
circumstances under which they were made) not misleading or that any
amendment or supplement to the Prospectus, as of the Closing Date,
contained an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading
(it being understood that such counsel need provide no such statement
with respect to the financial statements and the notes thereto and the
schedules and other financial and statistical data included in the
Registration Statement or the Prospectus).
In rendering such opinion, counsel may limit such opinion to
matters involving the application of the laws of Texas, the Delaware
General Corporation Law, the 1940 Act and the Advisers Act and may rely
upon an opinion or opinions, each dated the Closing Date, of other
counsel retained by the Investment Adviser as to laws of any
jurisdiction other than the United States, Texas and the Delaware
General Corporation Law, provided that (X) each such local counsel is
acceptable to the Representatives, (Y) such reliance is expressly
authorized by each opinion so relied upon and a copy of each such
opinion is delivered to the Representatives and is, in form and
substance satisfactory to them and their counsel and (Z) counsel shall
state in their view that they believe that they and the Underwriters
are justified in relying thereon.
(d) You shall have received on the Closing Date an opinion of
Xxxx X. Xxxxxxx, General Counsel for the Subadviser, dated the Closing
Date and addressed to you, as Representatives of the several
Underwriters, to the effect that:
(i) Based on certificates of the Secretary of State
of the State of Delaware, the Subadviser is a corporation duly
incorporated and validly existing in good standing under the
laws of Delaware with all necessary 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 based on certificates of the
applicable secretaries of state, the Subadviser is duly
registered and qualified to
27
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
ability of the Subadviser to perform its obligations under
this Agreement and the Advisory Agreements to which it is a
party;
(ii) The Subadviser is duly registered with the
Commission under the Advisers Act as an investment adviser 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 for the Fund under the Sub-Advisory
Agreement as contemplated by the Prospectus (and any amendment
or supplement thereto);
(iii) The Subadviser has power and authority to enter
into this Agreement and the Sub-Advisory Agreement and this
Agreement and the Sub-Advisory Agreement have been duly
authorized, executed and delivered by the Subadviser and each
of this Agreement and the Sub-Advisory Agreement is a valid,
legal and binding agreement of the Subadviser, enforceable
against the Subadviser in accordance with its terms, except as
enforcement of rights to indemnity and contribution hereunder
may be limited by Federal or state securities laws or
principles of public policy and subject to the qualification
that the enforceability of the Subadviser's obligations
hereunder and thereunder may be limited by bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium
and other laws relating to or affecting creditors' rights
generally and by general equitable principles whether
enforcement is considered in a proceeding in equity or at law;
(iv) Neither the execution and delivery by the
Subadviser of this Agreement or the Sub-Advisory Agreement nor
the consummation by the Subadviser of the transactions
contemplated hereunder or thereunder constitutes or will
constitute a breach of or a default under the articles of
incorporation, by-laws or other organizational documents of
the Subadviser or any material agreement, indenture, lease or
other instrument to which the Subadviser is a party that is
known to such counsel after reasonable inquiry, or will result
in the creation or imposition of any material lien, charge or
encumbrance upon any material property or material assets of
the Subadviser, nor will any such action result in any
violation of any law of the State of Georgia, the Delaware
General Corporation Law, the 1940 Act, the Advisers Act or
regulation, ruling (assuming compliance with all applicable
state securities and Blue Sky laws), judgment, injunction,
order or decree known to such counsel after reasonable
inquiry, applicable to the Subadviser or any of its
properties;
(v) The Subadviser owns, possesses or has obtained
and currently maintains all governmental licenses, permits,
consents, orders, approvals and other authorizations as are
necessary for the Subadviser to carry on its business as
described in the Prospectus (and any amendment or supplement
thereto); and
28
(vi) No material consent, approval, authorization or
order of or registration or filing with any court, regulatory
body, administrative or other governmental body, agency or
official is required on the part of the Subadviser for the
performance of this Agreement or the Sub-Advisory Agreement by
the Subadviser or for the consummation by the Subadviser of
the transactions contemplated hereby or thereby.
The opinion shall also include the following statement:
Such counsel shall confirm that it has no knowledge
of any actions, suits or other legal or governmental
proceedings pending or threatened against the Subadviser, or
to which the Subadviser 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
thereto) that are not described as required.
Such counsel shall also state that although counsel has not
undertaken, except as otherwise indicated in its opinion, to determine
independently and does not assume any responsibility for, the accuracy
or completeness of the statements in the Registration Statement, such
counsel has reviewed the contents of the Registration Statement and the
Prospectus as they relate to the Subadviser and has discussed such
contents with officers and other representatives of the Subadviser who
have participated in the preparation of the Registration Statement and
the Prospectus, including review and discussion of the contents thereof
and nothing has come to its attention that has caused it to believe
that such contents of the Registration Statement at the time it became
effective or the Prospectus, as of its date and as of the Closing Date,
contained an untrue statement of a material fact regarding the
Subadviser or omitted to state a material fact regarding the Subadviser
required to be stated therein or necessary to make the statements
therein (in the case of a prospectus, in light of the circumstances
under which they were made) not misleading or that any amendment or
supplement to the Prospectus, as of the Closing Date, contained an
untrue statement of a material fact regarding the Subadviser or omitted
to state a material fact regarding the Subadviser necessary in order to
make the statements therein, in light of the circumstances under which
they were made, not misleading (it being understood that such counsel
need provide no such statement with respect to the financial statements
and the notes thereto and the schedules and other financial and
statistical data included in the Registration Statement or the
Prospectus).
In rendering such opinion, counsel may limit such opinion to
matters involving the application of the laws of Georgia, the Delaware
General Corporation Law, the 1940 Act and the Advisers Act and may rely
upon an opinion or opinions, each dated the Closing Date, of other
counsel retained by the Subadviser as to laws of any jurisdiction other
than the United States, Georgia and the Delaware General Corporation
Law, provided that (X) each such local counsel is acceptable to the
Representatives, (Y) such reliance is expressly authorized by each
opinion so relied upon and a copy of each such opinion is delivered to
the Representatives and is, in form and substance satisfactory to them
and their counsel and (Z) counsel shall state in their view that they
believe that they and the Underwriters are justified in relying
thereon.
29
(e) That you shall have received on the Closing Date, an
opinion, dated the Closing Date, 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 require and the Fund, the Advisers and
their respective counsels shall have furnished to such counsel such
documents as they may request for the purpose of enabling them to pass
upon such matters.
(f) That you shall have received letters addressed to you, as
Representatives of the several Underwriters, and dated the date hereof
and the Closing Date from PricewaterhouseCoopers LLP, independent
certified public accountants, substantially in the forms heretofore
approved by you.
(g) (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 action against the Fund, the Advisers 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 Advisers 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 reasonable satisfaction of the Representatives, (ii) there shall
not have been any change in the capitalization of the Fund nor any
material increase in debt of the Fund (other than in the ordinary
course of business) from that set forth in the Registration Statement
or Prospectus (and any amendment or supplement thereto) and the Fund
shall not have sustained any material liabilities or obligations,
direct or contingent, other than those reflected in the Prospectus (and
any amendment or supplement thereto); (iii) since the date of the
Prospectus, except as may be stated in the Prospectus (and any
amendment or supplement thereto), there shall not have been any
material, adverse change (other than as a result of changes in market
conditions generally or the market for securities of Real Estate
Companies generally) in the condition (financial or other), assets or
results of operations of the Fund; (iv) the Fund and the Advisers must
not have sustained any material loss or interference with its business
from any court or from legislative or other governmental action, order
or decree or from any other occurrence not described in the
Registration Statement and the Prospectus (and any amendment or
supplement to either of them); and (v) all of the representations and
warranties of the Fund and the Advisers contained in this Agreement
that are qualified by a materiality standard shall be true and correct
and all representations and warranties of the Fund and the Advisers
contained in this Agreement that are not so qualified shall be true and
correct in all material respects, on and as of the date hereof and as
of the Closing Date as if made on and as of the Closing Date.
(h) Subsequent to the effective date of this Agreement, there
shall not have occurred: (i) any change or any development involving a
prospective change in or
30
affecting the condition (financial or other), assets or results of
operations of the Fund or the Advisers not contemplated by the
Prospectus (and any amendment or supplement thereto), which in your
reasonable 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, the
Advisers or any officer or trustee or director of the Fund or the
Advisers which makes any statement of a material fact made in the
Prospectus (or any amendment or supplement thereto) 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 (or any amendment or supplement thereto) in order to state a
material fact required by the 1933 Act, the 1940 Act, the Rules and
Regulations or any other law to be stated therein or necessary in order
to make the statements therein (in the case of a prospectus, in light
of the circumstances under which they were made) not misleading, if
amending or supplementing the Prospectus (or any amendment or
supplement thereto) to reflect such event or development would, in your
reasonable opinion, as Representatives of the several Underwriters,
materially, adversely affect the market for the Shares.
(i) Neither the Fund nor either of the Advisers shall have
failed at or prior to the Closing Date to have performed or complied in
all material respects 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.
(j) That you shall have received on the Closing Date a
certificate, dated such date, of the president or any vice president
and of the controller or treasurer of each of the Fund, the Investment
Adviser and the Subadviser to the effect set forth in Sections 9(g),
9(h) and 9(i).
(k) The Fund shall have furnished to you a report showing
compliance with the asset coverage requirements of the 1940 Act and a
Preferred Shares Basic Maintenance Report (as defined in the Amended
Bylaws), each dated the Closing Date and in form and substance
satisfactory to you.
(l) The Fund shall have delivered and the Underwriters shall
have received evidence satisfactory to the Underwriters that each
series of Preferred Shares is rated 'Aaa' by Xxxxx'x and either (i)
'AAA' by S&P or (ii) 'AAA' by Fitch, 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 each series of the Preferred Shares by
any Rating Agency.
(m) That the Fund and the Advisers shall have furnished to you
such further certificates and documents as you shall reasonably request
(including certificates of officers of the Fund and the Advisers).
All such opinions, certificates, letters and other documents
will be in compliance with the provisions hereof only if they are
reasonably satisfactory in form and substance to you and your counsel
acting in good faith.
31
Any certificate or document signed by any officer of the Fund
or the Advisers and delivered to you, as Representatives of the
Underwriters or to Underwriters' counsel, shall be deemed a
representation and warranty by the Fund or the Advisers, as applicable,
to each Underwriter as to the respective statements made therein.
10. 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 the Registration
Statement or such post-effective amendment has become effective. 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 the 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 aggregate 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 11 of the
Xxxxxxx Xxxxx Xxxxxx Master Agreement Among Underwriters, to purchase Shares
which such defaulting Underwriter or Underwriters are obligated but fail or
refuse to purchase. If any Underwriter or 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, 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, the Fund or the
Advisers. In any such case which does not result in termination of this
Agreement, 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 to any
such default of any such Underwriter under this Agreement. The term
"Underwriter" as 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
agreed, but failed or refused, to purchase.
Any notice under this Section 10 may be made by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
11. 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 Advisers, by notice to the Fund or the Advisers,
if prior to the Closing Date, (i) trading in securities
32
generally or in the Fund's Common Shares specifically on the NYSE, the American
Stock Exchange, Nasdaq National Market or the Nasdaq Stock Market shall have
been suspended or materially limited or minimum prices shall have been
established on any such exchange or market by such exchange or market, the SEC
or other governmental agency or self-regulatory organization, (ii) additional
material governmental restrictions not in force on the date of this Agreement
have been imposed upon trading in securities generally or a general moratorium
on commercial banking activities in New York shall have been declared by either
Federal or state authorities or (iii) any outbreak or material escalation of
hostilities, declaration of war by the United States of a national emergency or
war, or other international or domestic calamity, crisis or other significant
change in political, financial or economic conditions, occurs, the effect of
which 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 or the Advisers by telegram, telecopy or telephone but shall
be subsequently confirmed by letter to the Fund.
12. Expenses. The Fund agrees to pay the following costs and expenses
and all other costs and expenses incident to the performance by the Fund of its
obligations hereunder: (a) the preparation, printing or reproduction and filing
with the Commission (including, without limitation, the filing fees prescribed
by the 1933 Act, the 1940 Act and the Rules and Regulations) of the Registration
Statement (including exhibits thereto), the Prospectus, each Prepricing
Prospectus and the 1940 Act Notification and all amendments or supplements to
any of them; (b) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such copies of
the Registration Statement, the Prospectus, each Prepricing 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; (c) the preparation, printing, authentication, issuance and delivery of
certificates for the Shares, including any stamp taxes and transfer agent and
registrar fees payable in connection with the original issuance and sale of such
Shares; (d) the registrations or qualifications of the Shares for offer and sale
under the 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); (e) the fees and expenses of the
Fund's independent accountants, counsel for the Fund and of the auction agent;
(f) the printing (or reproduction) and delivery of this Agreement, any dealer
agreements, and all other company-authorized agreements or other documents
printed (or reproduced) and delivered in connection with the offering of the
Shares; (g) the filing fees and the reasonable fees and expenses of counsel for
the Underwriters in connection with any filings required to be made with the
NASD and incurred with respect to the review of the offering of the Shares by
the NASD, and (h) the fees of any Rating Agencies..
Notwithstanding the foregoing, in the event that the sale of the Shares
is not consummated pursuant to Section 2 hereof, the Advisers will pay the costs
and expenses of the Fund set forth above in this Section 12 (a) through (h).
33
13. Information Furnished by the Underwriters. The statements set forth
in the last sentence of the front cover page in the Prospectus, as well as,
under the caption "Underwriting" in the Prospectus, the names of the
underwriters and numbers of Shares listed opposite such names following the
first paragraph, [each sentence of the third paragraph (other than the second
sentence) and the seventh paragraph] constitute the only information furnished
by or on behalf of the Underwriters through you or your counsel as such
information is referred to herein, expressly for use in the Prospectus,
including in Sections 6(b) and 8 hereof.
14. Miscellaneous. Except as otherwise provided in Sections 5, 10 and
11 hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (a) if to the Fund or the Investment Adviser, 00
Xxxxxxxx Xxxxx, 00xx Xxxxx, Xxxxxxxxx Xxxxx. X. Xxxxxxx, Esq., General Counsel,
(b) if to the Subadviser, 0000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, XX 00000,
Attention: Xxxxx X. Xxxxxxx, or (c) if to you, as Representatives of the
Underwriters, at the office of Xxxxxxx Xxxxx Xxxxxx Inc. at 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Manager, Investment Banking
Division.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Fund, the Advisers, their trustees, 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 shall acquire or have any right under or by virtue of this
Agreement. Neither the term "successor" or 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.
A copy of the Certificate of Trust of the Fund is on file with the
Secretary of State of the State of Delaware. This Agreement has been executed on
behalf of the Fund by an officer of the Fund in such capacity and not
individually and the obligations of this Agreement are not binding upon such
officer, any of the trustees or the shareholders individually but are binding
only upon the assets and property of the Fund.
As provided by applicable law, no shareholder of the Fund shall be
personally liable for the debts, liabilities, obligations and expenses incurred
by, contracted for, or otherwise existing with respect to, the Fund or any class
thereof. Neither the Fund nor the Trustees, nor any officer, employee, or agent
of the Fund has any power to bind personally any shareholder or to call upon any
shareholder for the payment of any sum of money or assessment whatsoever other
than such as the shareholder may at any time personally agree to pay by way of
subscription for any shares or otherwise. The shareholders shall be entitled, to
the fullest extent permitted by applicable law, to the same limitation of
personal liability as is extended under the Delaware General Corporation Law to
stockholders of private corporations for profit. The obligations of the Fund
represented by this Agreement are limited to the Fund and the assets belonging
thereto.
15. Applicable Law; Counterparts. This Agreement shall be governed by
and construed in accordance with the laws of 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
34
at least one counterpart hereof shall have been executed and delivered on behalf
of each party hereto.
35
Please confirm that the foregoing correctly sets forth the agreement
among the Fund and the Advisers and the several Underwriters.
Very truly yours,
AIM SELECT REAL ESTATE INCOME FUND
By: ______________________________
Title:
A I M ADVISORS, INC.
By: ______________________________
Title:
INVESCO INSTITUTIONAL (N.A.), INC.
By: ______________________________
Title:
36
Confirmed as of the date
first above written on
behalf of themselves and
the other several
Underwriters named in
Schedule I hereto.
By: XXXXXXX XXXXX BARNEY INC.
[to come]
AS REPRESENTATIVES OF THE SEVERAL UNDERWRITERS
By: XXXXXXX XXXXX XXXXXX INC.
By: ___________________________________
Title: Director
37
SCHEDULE I
NUMBER OF
NAME OF UNDERWRITER SHARES
------------------- ------
Xxxxxxx Xxxxx Barney Inc...........................................
[to come]
---------
Total Underwriters ([___]).........................................
